Delinquency Rate for US Commercial Real Estate Loans in CMBS Fell Six Basis Points in January
Posted February 2, 2012
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The delinquency rate for U.S. commercial real estate loans in CMBS fell six basis points in January to 9.52 percent, according to commercial real estate mortgage information provider Trepp, LLC. The value of delinquent loans is now $57.7 billion.
The first wave of 2007 originated loans that reached their balloon dates in January performed poorly, with only 27% of these loans managing to pay off. While this should have pushed the delinquency rate much higher, this upward pressure was offset by about $1.6 billion in loans that were resolved with losses during the month.
"The CMBS market performance will be dictated by two trends going forward," said Manus Clancy, senior managing director at Trepp. "The pace of loan liquidations will compete against the growth of delinquent loans that emerge from the Class of 2007. If the rate of loan liquidations slows, the rate will climb. If the special servicers keep plowing ahead at the pace they did in January, the rate could manage to stay flat."
The multifamily delinquency rate fell 18 basis points in January but remains the worst performing property type at 15.39 percent.
The industrial delinquency rate was up 11 basis points to 12.14 percent in January, replacing hotel loans as the second worst performing category.
Lodging delinquencies finished the month down 11 basis points at 12.09 percent.
The office delinquency rate dropped seven basis points to 8.90 percent and the retail delinquency rate increased three basis points to 7.88 percenet, remaining the best performing property type.
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