Trepp CMBS Delinquency Rate Continues Retreat from Near All-Time High

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The Trepp CMBS delinquency rate continued its downward trend in August after posting the largest decline in four years in July.

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The overall CMBS delinquency rate in August was 9.02%, a decline of 58 basis points from the July number. About $6.5 billion in loans were “cured” in August, helping the rate post another sizable decline.

Trepp, a leading provider of information, analytics, and technology to the structured finance, commercial real estate, and banking markets, has released the August 2020 U.S. CMBS Delinquency Report.

The report revealed that the CMBS delinquency rate continued its downward trend in August after posting the largest decline in four years in July. The full report can be accessed here: https://www.trepp.com/instantly-access-august-2020-cmbs-delinquency-report.

The overall CMBS delinquency rate in August was 9.02%, a decline of 58 basis points from the July number. About $6.5 billion in loans were “cured” in August, helping the rate post another sizable decline.

"By 'cure,' we mean that the loan was delinquent in July but reverted to current (or in or beyond grace period) status in August," said Manus Clancy, Trepp Senior Managing Director. "Some of these cures came as a result of forbearances being granted and borrowers being authorized to use reserves to make the loan current. In other cases, relief was canceled or withdrawn by the borrowers and the loans were brought current without relief."

About 1.21% of the overall number represents loans in the 30 days delinquent bucket while another 1.04% is now 60 days delinquent. Both of those numbers were sizable improvements from July. However, the percentage of loans that are 90 or more days delinquent rose to 4.02% in August from 2.65% in July.

In terms of loans in grace period, 3.14% of loans by balance missed the August payment but were less than 30 days delinquent. That was up from 2.83% in July.

Earlier this summer, we noted that the delinquency rate could be reaching “terminal delinquency velocity” – which reflected the belief that most borrowers that felt the need for debt service relief have already requested it.

For additional details, such as historical comparisons, analysis on all major property types, an overview of loans newly specially serviced, and the status of loans in grace period or beyond, download Trepp’s August 2020 CMBS Delinquency Report: https://www.trepp.com/instantly-access-august-2020-cmbs-delinquency-report.

For daily CMBS and CRE commentary, follow @TreppWire on Twitter.

About Trepp
Trepp, founded in 1979, is the leading provider of information, analytics, and technology to the structured finance, 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. From its offices in New York, San Francisco, and London, Trepp serves its clients with products and services to support trading, research, risk management, surveillance, and portfolio management. Trepp is wholly-owned by Daily Mail and General Trust (DMGT). For more information, visit https://www.Trepp.com.

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Hayley Keen
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