Commercial Mortgage Delinquency Soars to Historic High
The delinquency rate among commercial mortgage-backed securities (CMBS) topped 8% to yet another historical high in April, according to the latest data from analytics firm Trepp. The percentage of loans 30+ days delinquent, in foreclosure or real estate owned (REO) status jumped 41 basis points (bps) to an overall 8.02%, from 7.61% in March. The share of loans considered "seriously delinquent" -- 60+ days delinquent, in foreclosure or REO status climbed 48bps to its own record-high of 7.14%. The share of CMBS loans past due has marched higher and higher over the last year: In April 2009, the 30+ day delinquency, foreclosure and REO rate was only 2.45%. Six months ago, that rate nearly doubled to 4.8% in October 2009. The rate of growth is more pronounced in the seriously delinquent bucket. At the same time last year, 1.78% of CMBS loans were 60+ days delinquent, in foreclosure or REO status. That more than doubled to 3.91% by October 2009. Despite the new records, the rate of growth in delinquency slowed somewhat from what Trepp called a "breakneck pace" in March. "Last month, the market was taken by surprise when delinquencies shot up 89 basis points. About 40 basis points of that increase was due to the massive Stuyvesant Town loan becoming delinquent," Trepp said in e-mailed commentary. "Even so, the 49 basis point net increase was more than twice the increase posted in February." Multifamily loans within CMBS were the only collateral type to post a decrease in delinquency in April. Trepp found this sector eased 13bps to 13.06% delinquent. Office loans grew to 5.37% delinquent, from 4.73% in March. Retail delinquencies grew 41bps to 6.44%, while industrial delinquencies gained 5bps to 5.44%. Hotel delinquencies swelled 27bps to 17.16%, Trepp found. Write to Diana Golobay.