Trepp reported that both delinquency rates and special servicing rates for multifamily CMBS loans rose in June. Delinquency rates and special servicing rates for the overall CMBS market also rose driven by problems with loans on office properties.
Overall CBMS delinquency rate rises
For delinquencies, Trepp focuses on loans that are 30 or more days delinquent. The current CMBS delinquency report provides data through June 2023. While it only looks at CMBS loans, it breaks out results by the type of property covered by the loans.
The delinquency rate on loans on multifamily property was 1.59 percent, up from 1.46 percent in May. One year ago, the delinquency rate on CMBS loans for multifamily property was 1.03 percent.
Trepp found that the overall delinquency rate on CMBS loans in June was 3.90 percent. This is up from last month’s level of 3.62 percent.
Your property type may vary
The other property types whose CMBS loan delinquencies were examined were industrial, lodging, office and retail.
Lodging CMBS delinquencies moved significantly higher, rising from 4.25 percent to 5.35 percent. Delinquencies on CMBS loans for office properties were up again, rising to 4.50 percent from May’s level of 4.02 percent and from April’s reading of 2.77 percent. Industrial CMBS delinquencies edged upward from 0.42 percent to 0.40 percent. CMBS loans on retail properties fell to 6.48 percent from last month’s level of 6.67 percent.
The history of the overall and multifamily CMBS delinquency rates as reported by Trepp since January 2020 is illustrated in the chart, below.
CMBS special servicing rates also rise
Trepp also issued a report on special servicing rates in June for CMBS loans. It found that overall special servicing rates rose to 6.42 percent, up from 6.11 percent the month before. This rate has been generally trending upward for the past year.
Special servicing rates on CMBS loans on multifamily property were also higher, climbing to 3.28 percent in June from the 2.97 percent rate reported for May. This rate has also been trending higher for the last year but with more occasional reversals than for the overall rate. It has now been higher than the highest level reached during the pandemic for 4 months in a row.
Special servicing rates on CMBS loans on industrial properties were unchanged again at 0.39 percent while rates on lodging properties rose 1 basis point to 6.40 percent. Special servicing rates on retail properties rose 5 basis points to 11.06 percent while rates on office properties rose 81 basis points to 6.43 percent.
The history of the overall and multifamily CMBS special servicing rates as reported by Trepp since January 2020 is illustrated in the chart, below.
The full Trepp delinquency report can be found here while the Trepp report on special servicing rates can be found here.
