The commercial mortgage-backed securities (CMBS) delinquency rate spiked by 17 basis points in December to 6.57%, according to new data from Trepp Inc.
Year-over-year, the overall CMBS delinquency rate is up 206 basis points. The percentage of loans that are seriously delinquent (60-plus days delinquent, in foreclosure, REO, or non-performing balloons) is 6.31%, up 43 basis point for the month.
The rising delinquency rate was primarily due to the office and retail sectors. The office sector recorded a 63 basis points rise to a new high of 11.01%. This marked the first time that the office sector’s delinquency rate surpassed the 11% mark – the previous peak was 10.70% in December 2012. Trepp noted there were more than $2 billion in office loans that became newly delinquent this month.
Also complicating the picture was the retail delinquency rate, which experienced the largest respective increase across property types with a massive 86 basis points increase to 7.43%. The retail delinquency rate has increased more than 115 basis points over the course of 2024 and is currently at a 2.5 year high. Trepp noted the largest newly delinquent retail loan was a single-asset, single-borrower loan with a balance of more than $500 million.
Among the other sectors, the multifamily delinquency rate increased 40 basis points to 4.58% while the industrial delinquency rate decreased 3 basis points to 0.29% and the lodging delinquency rate decreased 78 basis points to 6.14%.
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