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Wave of Maturing Loans Drives Up CMBS Delinquency

There was significant deterioration in the performance of securitized commercial real estate loans last month due to a wave of maturing loans.

Loans that are included in commercial mortgage-backed securities had a 30-day delinquency rate of
4.98 percent as of Oct. 31 of this year.

CMBS delinquency soared 20 basis points compared to the end of the previous month, though the rate was down 25 BPS from a year previous.

Trepp LLC reported the performance statistics Wednesday.

“The Trepp CMBS delinquency rate continued its ascent in October,” the report stated. “The rate began to rise in March as loans from the 2006 and 2007 vintages started to reach their maturity dates, which has caused the reading to move higher in seven of the last eight months.”

At 6.19 percent, delinquency on securitized retail property loans worsened from Sept. 30, 2016, by 30 BPS — more than for any other property type.

A 26-basis-point rise left the 30-day rate on CMBS loans secured by industrial properties at 5.54 percent as of the end of last month.

On lodging loans, the rate climbed 18 BPS from September to 3.43 percent.

CMBS loans secured by office buildings had a 6.44 percent rate as of October, up 11 BPS from a month earlier.

The smallest month-over-month increase — 8 BPS — was on securitized multifamily loans, with the rate ending the latest month at 2.41 percent.

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