US CMBS Delinquency Rate Inches up to End the Year

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Trepp released its December 2015 US CMBS Delinquency Report today, which highlights an increase in delinquencies and changes by property type.

CMBS Delinquency Rate by Month

"The gradually improving (delinquency) rate was one of the positive stories for the market in 2015.

Trepp LLC, the leading provider of information, analytics and technology to the CMBS, commercial real estate, and banking markets, released its December 2015 US CMBS Delinquency Report today (available at http://info.trepp.com/thank-you-december-2015-cmbs-delinquency-report).

After three straight months of improvement, The Trepp CMBS Delinquency Rate closed out the year four basis points higher. The delinquency rate for US commercial real estate loans in CMBS is now 5.17%. Year-to-date, delinquencies for US commercial real estate loans have fallen 58 basis points.

In December, over $1.6 billion in loans became newly delinquent. About $450 million in loans were cured last month while almost $1.1 billion in loans that were previously delinquent paid off with a loss or at par. There are currently $26.4 billion in delinquent CMBS loans.

“Even though the delinquency rate inched up in December, the gradually improving rate was one of the positive stories for the market in 2015,” said Manus Clancy, Senior Director at Trepp. “With issuance levels coming in below expectations and lending spreads widening over the second half of the year, there are more questions than answers heading into 2016. Thankfully, the delinquency rate should not be one of the questions as we expect it to continue downward.”

The industrial delinquency rates had the greatest month-over-month improvement, falling 26 basis points. Although the lodging sector remains the best performing major property type, the reading increased seven basis points to 2.82% in December. The multifamily delinquency jumped 13 basis points to 8.28%, and remains the worst performing among the major property types.

For additional details, such as delinquency status and historical comparisons, download the December 2015 US CMBS Delinquency Report at http://info.trepp.com/thank-you-december-2015-cmbs-delinquency-report. For daily CMBS commentary, follow @TreppWire on Twitter.

About Trepp
Trepp, LLC, founded in 1979, is the leading provider of information, analytics and technology to the CMBS, commercial real estate and banking markets. Trepp provides primary and secondary market participants with the web-based tools and insight they need to increase their operational efficiencies, information transparency and investment performance. Trepp serves its clients with products and services to support trading, research, risk management, surveillance and portfolio management. Trepp is wholly-owned by dmgi, a division of the Daily Mail and General Trust (DMGT).

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Joe McBride
Trepp
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