National CRE News In Your Inbox.
Sign up for Connect emails to stay informed with CRE stories that are 150 words or less.
Good News: CMBS Delinquency Rate Breaks Through 3% Threshold
New research by Trepp shows the CMBS delinquency rate broke through the 3% threshold in February, and the reading continues on a steady decline. The February overall U.S. reading fell 15 basis points to 2.87% while hitting yet another post-crisis low, and the delinquency rate is 164 basis points lower year-over-year.
Trepp notes in its latest report, “the reading started to fall after the June 2017 report when CMBS delinquencies registered 5.75%. Since then, the rate has fallen in 18 of the last 20 months. The all-time high of 10.34% came in July 2012.”
The percentage of loans that are seriously delinquent (60+ days delinquent, in foreclosure, REO, or non- performing balloons) is now 2.84%, down one basis point for the month. And Trepp points out, if defeased loans were taken out of the equation, the overall 30-day delinquency rate would be 3%, 16 basis points lower from January.
A year ago, the U.S. CMBS delinquency rate was 4.51%, and six months ago, the rate stood at 3.64%.
By property type, Trepp found the industrial delinquency rate rose 12 basis points to 2.17%. The lodging reading dipped four basis points to 1.49%, and remains the best-performing major property type.
The multifamily rate moved up 34 basis points to 2.31%. The office delinquency rate declined 34 basis points to 3.13%. The retail delinquency rate fell 15 basis points to 4.77%. Retail remains the worst performing major property type, though Trepp notes the reading has improved in each of the last five months.
For comments, questions or concerns, please contact Dennis Kaiser
- ◦Financing
