For the third month in a row, the performance of securitized commercial real estate loans has deteriorated, with office loans leading the way.
The 30-day delinquency rate on loans
that are included in commercial mortgage-backed securities concluded February 2017 at 3.04 percent.
That was 3 basis points worse than at the end of the previous month. Compared to the same point last year, the rate has risen 28 BPS.
Morningstar Credit Ratings LLC reported the statistics based on the the $779 billion in CMBS it rates.
Late payments on securitized CRE loans have worsened every month since November 2016, when the 30-day rate came in at 2.98 percent.
“With many of the maturing loans overleveraged and lenders being more conservative, we expect the maturity payoff rate to fall, because loans issued in 2007 were often originated under more aggressive terms than those in 2006,” the ratings agency said in the report. “We project that only about 55 percent – 60 percent of the nondefeased loans coming due in 2017 will be able to refinance, down from the year-to-date payoff rate of 72.5 percent.”
A 38-basis-point increase from January 2017 on office building CMBS loans was the biggest increase of any property type. The deterioration left the delinquency rate at 6.71 percent.
On securitized CRE loans secured by healthcare properties, the rate rose 3 BPS to 2.01 percent as of last month.
At 2.99 percent, the 30-day rate on hotel CMBS loans was down a basis point from January.
Delinquency on industrial property loans fell 3 PBS to 4.88 percent.
CMBS loans secured by multifamily loans had an 0.50 percent delinquency rate, 6 BPS better than at the end of January.
Also declining 6 BPS was the 30-day rate on securitized retail property loans, which finished February at 5.52 percent.
