The commercial mortgage-backed securities (CMBS) delinquency rate surged in April by 40 basis points to 5.07%, according to new data from Trepp Inc. This marked the highest delinquency rate level since the 5.35% that was recorded in September 2021.
“The increase was driven by spikes in the office, lodging, and retail sectors, with more than a dozen loans with outstanding balances greater than $100 million becoming delinquent during April,” observed Stephen Buschbom, research director at Trepp. “The size of the month-over-month increases for each of these three property sectors was the highest in almost a year.”
The office delinquency rate spiked by 80 basis points to 7.38% while the lodging delinquency rate increased 52 basis points to 5.97% and the retail delinquency rate increased 38 basis points to 5.94%.
Only two commercial property sectors recorded drops in their respective delinquency rates: the industrial delinquency rate decreased 3 basis points to 0.44% and the multifamily delinquency rate decreased 51 basis points to 1.33%.
One year ago, the CMBS delinquency rate was 3.09% – a difference of 198 basis points from the latest reading. The percentage of loans that are seriously delinquent (60-plus days delinquent, in foreclosure, REO, or non-performing balloons) is now 4.84%, up 33 basis points for the month. If defeased loans were taken out of the equation, the overall headline delinquency rate would be 5.29%, up 39 basis points from March.
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