2021–22 Apartment CLO Loans Account for 80% of Delinquent Debt in Five Major States

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A relatively small group of apartment loans made during the low-rate years of 2021 and 2022 accounts for most of the delinquent multifamily debt in commercial real estate collateralized loan obligations across five major states, according to Trepp.

Loans from those two securitization years represent 12.2% of the CRE CLO multifamily balance in California, Texas, New York, Florida and Georgia, but 80.2% of delinquent balances. Their delinquency rate is 20.21%, compared with 0.69% for loans securitized in other years. The findings come from Trepp’s October 16 analysis of the loan-level dataset.

The comparison is restricted to CRE CLO multifamily loans in those five states. It should not be presented as the delinquency rate for all U.S. apartment mortgages, nor as the entire agency multifamily market.

Floating-rate debt meets weaker cash flow

All 93 loans in the 2021–22 cohort, representing approximately $3.95 billion in outstanding balance, have floating interest rates tied to the Secured Overnight Financing Rate. Trepp says the median coupon is now 7.16%.

SOFR averaged about 0.04% in 2021 and 3.66% in September 2026. For a loan with an unchanged spread and no effective rate cap, that difference would raise the interest component of the payment by roughly 3.6 percentage points. Individual borrowers may have interest-rate caps, reserves or modified terms that change the actual impact.

Trepp examined loans with debt service coverage ratios reported both at securitization and more recently. Across that 48-loan reporting sample, median net-cash-flow coverage fell to 0.64 from 1.60. Among delinquent loans, the median dropped to 0.50 from 1.72. Among performing loans, it fell to 0.65 from 1.57.

Coverage below 1.0 means reported property net cash flow is insufficient to meet the debt service used in the calculation. Trepp found that 93.8% of the performing cohort’s balance with a reported recent coverage ratio was below that threshold. Those loans are still performing, illustrating how financial stress can precede a delinquency classification.

Delinquency is uneven across states

Georgia has the highest delinquency rate within this specific 2021–22 CRE CLO cohort, at 59.65%, followed by Texas at 30.53%. Florida is at 9.37%, New York at 6.74% and California at 4.21%. The sample sizes and loan concentrations differ, and the numbers should not be treated as broad comparisons of apartment fundamentals across those states.

In Georgia, 10 of the state’s 11 delinquent CRE CLO multifamily loans are from the cohort. In New York, the unusually large difference between vintages is influenced by one delinquent loan in the 2021–22 group. A small number of large credits can produce dramatic balance-weighted percentages.

For lenders and bond investors, the combination of high coupons and reduced cash flow complicates loan extensions and refinancing. A property that was financed when floating rates were close to zero may need fresh equity or a lower debt balance to meet current underwriting standards.

A separate measure from agency apartment debt

WRE is also examining Trepp’s more recent Texas agency multifamily findings. That study concerns floating-rate agency loans and has a different denominator from this CRE CLO research. Combining the percentages would misstate both studies.

The next question for the 2021–22 CLO vintage is how much of the still-current but weakly covered debt can be modified, refinanced or repaid before maturity. The reported ratios indicate pressure; they do not predict a specific number of future foreclosures.

Source: Trepp, October 16, 2026. Photograph: Brandon Griggs / Unsplash, illustrative multifamily building, not a loan identified in the research.