The delinquency rate on commercial mortgage-backed securities rose 23 basis points to 9.65% in April, the largest jump in the history of U.S. commercial real estate loans in CMBS, commercial real estate firm Trepp
That delinquency rate includes loans that are 30-days or more delinquent, in foreclosure or REO.
The results are inline with findings from Barclays Capital
, which reported the rate of CMBS loans delinquent for 60-plus days rose 10 basis points to 9%.
"We expect them to continue rising though the year-end, due to the lagged response of CMBS credit to improving fundamentals," Barclays Capital said. Barclays added that delinquencies on hotel and industrial properties experienced 40-to-50 basis point jumps in 60-plus days delinquencies. Apartment delinquency rates fell 50 basis points.
"The value of all delinquent loans in CMBS now exceeds $62.8 billion," Barclays Capital concluded.
Trepp, an analytics firm specializing in CMBS, said the recent jump in delinquencies took analysts by surprise since the firm noted only small increases in February and March.
"Most of us thought that the worst was behind the CMBS market,” said Manus Clancy, managing director of Trepp. "But instead, the month indicated that the ride to recovery won't be without some bumps along the way."
Trepp said the jump arrives at a time when there are two significant downward pressures impacting the CMBS delinquency rate — the large number of CMBS loans being resolved by special servicers and the addition of new and current loans to the overall calculation.
Despite all this, the 23-basis point jump ended up well above the 12-month rolling average of an 18.5 basis points increase on a per month basis.
Write to Kerri Panchuk.