US CMBS Delinquency Rate Falls Below 3% for the First Time Since 2009

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Trepp has released its February 2019 CMBS Delinquency Report which highlights the fifth consecutive rate drop and its first sub-3% level in nearly 10 years.

CMBS Delinquency Rates by Property Type - February 2019

Delinquencies fell again last month, driven once more by the squeezing out of more remnants from the pre-crisis era.

Trepp, LLC, a leading provider of information, analytics, and technology to the structured finance, commercial real estate, and banking markets, has released its February 2019 US CMBS Delinquency Report. The full report can be accessed here: https://info.trepp.com/february-2019-cmbs-delinquency-report-pr.

The Trepp CMBS Delinquency Rate crossed another threshold in February as it dipped below 3% for the first time since May 2009. February’s reading clocked in at 2.87%, down 15 basis points from the prior month. This represents a new post-crisis low for the delinquency rate.

“Delinquencies fell again last month, driven once more by the squeezing out of more remnants from the pre-crisis era,” said Trepp Senior Managing Director, Manus Clancy. “While CMBS 2.0 has generally held up well, there are some pockets of concern that merit watching. In particular, some extra attention should be paid to student housing, grocery-anchored retail, and certain cities like Houston where several large assets are contending with sizable delinquencies.”

Although the overall CMBS 2.0+ rate dipped five basis points to 0.63% last month, the seriously delinquent reading for 2.0+ increased eight basis points to 0.60%. Delinquencies among CMBS 1.0 continue to slide as its overall rate dipped another 45 basis points to 44.83%. That reading has dropped 301 basis points since March 2018.

February's greatest month-over-month improvement by major property type belonged to the office segment. The office reading shed 34 basis points last month and now clocks in at 3.13%. Retail still has the worst performing rate among property types, but its reading fell once again in February. With its most recent decline of 15 basis points, the retail rate now sits at 4.77% and has improved in each of the last five months.

For additional details, such as historical comparisons and analysis on potential future rate moves, download the February 2019 US CMBS Delinquency Report: https://info.trepp.com/february-2019-cmbs-delinquency-report-pr. 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. 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 http://www.Trepp.com.

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Joe McBride
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