Trepp reported that the delinquency rate for multifamily commercial mortgage-backed securities (CMBS) loans moved higher again in August, rising 67 basis points. This is by far the highest monthly increase in the delinquency rate on loans for any of the property types tracked by Trepp. The multifamily CMBS delinquency rate has now risen steadily since April and is at its highest level in 3 years.
Overall CBMS delinquency nearly unchanged
For delinquencies, Trepp focuses on loans that are 30 or more days delinquent. The current CMBS delinquency report provides data through August 2024. While it only looks at CMBS loans, it breaks out results by the type of property covered by the loans.
The delinquency rate for loans on multifamily property was 3.30 percent, up from 2.63 percent in July, 2.36 percent in June, 1.70 percent in May and 1.33 percent in April. One year ago, the delinquency rate for CMBS loans for multifamily property was 1.84 percent. As in July 2021 when the multifamily CMBS delinquency rate also jumped, the result was driven by a single large loan becoming delinquent.
Trepp found that the overall delinquency rate of CMBS loans in August was 5.44 percent. This is up 1 basis point from last month’s level and up 119 basis points from its level one year ago.
The report noted that loans that are past their maturity date but are still current on their interest payments are not counted as being delinquent. However, if they were included, the overall delinquency rate on CMBS loans would rise to 7.21 percent.
The history of the overall and multifamily CMBS delinquency rates as reported by Trepp since January 2020 is illustrated in the chart, below.
Retail bucks the trend
The other property types whose CMBS loan delinquencies were examined by Trepp were industrial, lodging, office and retail.
Aside from loans on multifamily property, the only other property type whose CMBS delinquency rate increased for the month was retail, with a rise of 7 basis points to 6.21 percent. The CMBS delinquency rate for loans on office property fell 12 basis points. However, the delinquency rate for office loans remains the highest in the Trepp report at 7.97 percent.
The delinquency rate for industrial property fell 14 basis points to 0.50 percent. This remains by far the lowest CMBS delinquency rate of the property types tracked by Trepp. The CMBS delinquency rate for lodging had the largest decline for the month, falling 26 basis points to 5.91 percent.
The full Trepp delinquency report can be found here.
