US CMBS Delinquency Rate Dips in May

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Trepp has released its May 2017 CMBS Delinquency Report today, which highlights one of the few rate decreases to take place within the past year.

CMBS Delinquency Rate by Month

Although we noted that it was difficult to envision the delinquency rate falling anytime in the immediate future, this month's data defied that prediction for at least one period.

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

The Trepp CMBS Delinquency Rate fell in May, marking just the third time the reading has moved lower in the past year. The delinquency rate for US commercial real estate loans in CMBS is now 5.47%, a decrease of five basis points from April. A notable factor for the lower rate was a change in delinquency status for a small group of sizable loans from "non-performing, past maturity" to "performing, past maturity."

“Although we noted that it was difficult to envision the delinquency rate falling anytime in the immediate future, this month's data defied that prediction for at least one period,” said Manus Clancy, Senior Managing Director at Trepp. “The rate should be expected to crawl higher in the coming months as more pre-crisis loans reach their maturity dates, but May’s decrease is certainly a welcome respite.”

Roughly $1.15 billion in CMBS loans were cured in May, including the group of large notes whose designation switched to "performing, past maturity." About $735 million in CMBS debt that was previously delinquent was resolved with a loss or at par in May. Both of these figures helped nullify the nearly $1.7 billion in CMBS loans that became newly delinquent last month.

Despite a lower overall reading, the office sector was the only major property type to undergo a drop in its delinquency rate last month, as its reading tumbled 51 basis points to 7.46%. The largest increase by major property type in May belonged to the industrial segment, as that delinquency rate climbed 22 basis points to 7.37%. The delinquency rates for the retail and lodging sectors each moved up 20 basis points last month.

For additional details, such as delinquency status and historical comparisons, download the May 2017 US CMBS Delinquency Report: http://info.trepp.com/may-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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