Trepp reported that the delinquency rate for multifamily commercial mortgage-backed securities (CMBS) increased in July after 2 months of declines. It and industrial were the only property types to see their rates rise in the month. The overall CMBS delinquency rate rose modestly, gaining 10 basis points.
Overall CBMS delinquency rate continues slow climb
For delinquencies, Trepp focuses on loans that are 30 or more days delinquent. The current CMBS delinquency report provides data through July. 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 6.15 percent, up 24 basis points from last month’s reading. One year ago, the delinquency rate for CMBS loans for multifamily property was 2.63 percent.
Trepp found that the overall CMBS delinquency rate in July was 7.23 percent. The overall CMBS delinquency rate is up from its level of 5.43 percent 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 9.36 percent. This rate is up 65 basis points for the month, a much greater rise than the 10 basis point increase in the overall delinquency rate. CMBS loans that are past their maturity date but still current on interest now represent 2.13 percent of loans outstanding.
The history of the overall and multifamily CMBS delinquency rates as reported by Trepp since January 2020 is illustrated in the chart, below.
Delinquencies down for most other property types
The other property types whose CMBS delinquencies were examined by Trepp were industrial, lodging, office and retail.
The CBMS delinquency rate for office properties fell from the all-time high of 11.08 percent it reached last month. However, the fall was only by 4 basis points, leaving it still up 295 basis points for the year. Only multifamily has seen a greater rate rise over the past 12 months.
The rate for lodging properties fell 22 basis points for the month, declining to 6.59 percent. The delinquency rate on CMBS loans on retail property loans fell 16 basis points to 6.90 percent. This almost exactly reversed last month’s gain.
The CMBS delinquency rate for industrial property rose 1 basis points to 0.52 percent, its highest level since March.
The full Trepp delinquency report can be found here.
