EXPERTS WERE NOT surprised by the rise in delinquencies on commercial mortgage backed securities loans that happened in May. The size of the drop, however, was unexpectedly large, according to the Trepp research firm.
Trepp measured a 2.29 percent delinquency rate in April. By May the rate was 7.15 percent, the largest jump in delinquencies since the firm began tracking the metric in 2009. The rate could have topped 10 percent if the 8 percent of loans that missed their April payment had become 30 days delinquent.
“Many of the loans that were in the ‘grace’ or ‘beyond grace’ period either stayed in that category or reverted to “current,” keeping the jump in the delinquency rate from being worse,” said the Trepp report. “The numbers could head higher in June considering that about 7.6 percent of loans by balance missed the May payment but remained less than 30 days delinquent.”
- The national CMBS delinquency rate was 2.66 percent one year ago and 2.34 percent six months ago.
The lodging delinquency rate rose 1642 basis points to 19.13 percent, higher than industrial, multi-family, office and retail. Also, 16.2 percent of all lodging loans were in special servicing in May, up from 11.4 percent in April.
The percentage of loans with the special servicer rose from 4.39 percent in April to 6.07 percent in May. Also, 19.9 percent of all loans were on a servicer watch list.