Finance Midwest

U.S. CMBS Delinquency Rate worsens in March

The U.S. CMBS delinquency rate rose again in March with the percentage of loans 30+ days delinquent, in foreclosure or REO climbing 3 basis points to 9.42 percent, the highest in history for U.S. commercial real estate loans in CMBS.

The U.S. CMBS delinquency rate rose again in March with the percentage of loans 30+ days delinquent, in foreclosure or REO climbing 3 basis points to 9.42 percent, the highest in history for U.S. commercial real estate loans in CMBS.

Trepp, LLC, a provider of CMBS and commercial mortgage information, reports these findings in its March 2011 U.S. CMBS Delinquency Report

This month-over-month increase, however, is even smaller than February’s increase and is one of the smallest increases since the beginning of the credit crisis over two years ago.  The value of delinquent loans now exceeds $61.5 billion.

The Lodging and Office sectors boosted the overall delinquency rate in March by increasing 136 and 3 basis points respectively.  The Multifamily sector improved by 40 basis points, yet remained the worst performing property type, while the retail and industrial sectors also improved by 9 and 19 basis points, respectively.

“For the second straight month, we've seen the delinquency rate increase in the low single digits.  These are some of the best readings we've seen since the credit crisis began,” said Manus Clancy, managing director of Trepp, in a release.  “We believe that the overall delinquency rate will continue to rise over the next six months, but at a pace similar to what we've seen recently, not the 40 basis point jumps that we saw in 2009 and early 2010.  You cannot discount entirely, however, the possibility that we see the rate decline slightly in one of these months.”