US CMBS Delinquency Rate Resumes Ascent in February

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Trepp has released its February 2017 CMBS Delinquency Report and Infographic, highlighting another rate increase as more loans fail to be paid off at maturity.

CMBS Delinquent Loan Totals - February 2017

Since a large amount of maturing debt is backed by collateral with eroded credit quality, the number of loans with missed maturity payments will continue to push the rate up.

Trepp, LLC, a leading provider of information, analytics, and technology to the CMBS, commercial real estate, and banking markets, released its February 2017 US CMBS Delinquency Report today. The report can be found here: http://info.trepp.com/february-2017-us-cmbs-delinquency-report-press-release.

The Trepp CMBS Delinquency Rate rose in February after a slight drop in the month prior. The delinquency rate for US commercial real estate loans in CMBS is now 5.31%, up 13 basis points from January. This is the tenth monthly rate increase in the past 12 periods, as loans from 2006 and 2007 continue to reach their maturity dates without payoffs via refinancing. The delinquency rate is now 116 basis points higher than the year-ago level.

Over $2.3 billion in CMBS loans became newly delinquent in February, the second straight month where that total exceeded $2 billion. About $1.3 billion in CMBS loans that were previously delinquent paid off with a loss or at par last month. Over $850 million in loans were cured in February.

“Loan delinquencies remain on the upswing as the wave of maturities continues to run its course,” said Manus Clancy, Senior Managing Director at Trepp. “Since a large amount of maturing debt is backed by collateral with eroded credit quality, the number of loans with missed maturity payments will continue to push the rate up.”

The office sector accounted for the lion’s share of new delinquencies last month, evidenced by the sector’s reading. The office delinquency rate jumped 54 basis points to 7.65% in February, the largest increase of all major property types. The retail sector underwent the biggest improvement last month, as it shed 17 basis points to 5.93%. The lodging delinquency rate dropped 13 basis points to 3.43%.

For additional details, such as delinquency status and historical comparisons, download the January 2017 US CMBS Delinquency Report: http://info.trepp.com/february-2017-us-cmbs-delinquency-report-press-release. For daily CMBS commentary, follow @TreppWire on Twitter.

About Trepp
Trepp, LLC, founded in 1979, is a leading provider of data, analytics, and technology solutions to the global securities and investment management industries. Trepp specifically serves three key sectors: structured finance, commercial real estate, and banking to help market participants meet their objectives for surveillance, credit risk management, and investment performance. Trusted by the industry for the accuracy of its proprietary data, Trepp provides clients sophisticated, comprehensive models and analytics. Trepp is wholly owned by dmg Information, the business information division of Daily Mail and General Trust (DMGT). For more information, visit http://www.Trepp.com.

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Sean Barrie
Trepp
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