CMBS delinquency rate edges higher: Trepp
Delinquencies on commercial mortgage-backed securities edged slightly higher in September, finishing up a volatile five-month period in which the rate rose and fell sharply month-to-month, analytics firm Trepp said. The CMBS delinquency rate on CRE loans in securities grew 4 basis points to 9.56% last month, compared to 9.52% in August. That slight uptick showed signs of stabilization after the rate experienced its second-largest drop in three years during the month of August. "The CMBS market has now seen its delinquency rate fall in three of the last five months," Trepp said. "There is no denying that the tone in the CMBS market has been acutely negative for the past three months. The market has taken a series of body blows over that time period: spreads have risen sharply, lenders have pulled in the reigns on new loans, the U.S. economy has weakened, and many have speculated that the pricing of trophy properties in the U.S. has come too far too fast." Trepp said the month of September had a few bright spots, including the sale of a few trophy properties and the fact CMBS spreads settled considerably towards the end of the month. The number of loans classified as 60 or more days past due fell to 8.95%, 16 basis points lower than August. The overall delinquency rate a year ago was 9.05%. The hotel delinquency rate fell 46 basis points, now standing at 13.30%, while the office delinquency rate rose 12 basis points to 8.29%. In addition, the multifamily delinquency rate increased 52 basis points and continues to remain the worst performing property type with a delinquency rate of 16.96%. The retail delinquency rate also increased to 7.62%, which is up 24 basis points, but the sector still remains the best performing property type. Write to Kerri Panchuk.