The number of commercial foreclosures in Texas last month more than doubled from a year earlier, according to a new report that paints a grim picture of where the state could be headed.
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Texas commercial foreclosures increased 31% in March over the previous month and 129% from the previous year, real estate and property data company Attom Data Solutions reported. National foreclosures were up 6% in March and 117% for the year.
Only California, New York and Florida led Texas in total number of commercial foreclosures in March. California saw a staggering 187, which was an 8% drop from the previous month but a 405% increase from the previous year.
Commercial foreclosures have steadily risen since hitting a low of 141 nationwide in May 2020, according to Attom. That low reflected pandemic-related moratoriums and financial aid, which are now largely unavailable. There were 625 foreclosures nationally in March, down slightly from January’s 635.
Texas stayed about level with its January foreclosure number, according to data Attom provided to Bisnow. Texas saw 56 commercial foreclosures in January, 42 in February and 55 in March, the data shows.
“This uptick signifies not just a return to pre-pandemic activity levels but also underscores the ongoing adjustments within the commercial real estate sector as it navigates through a landscape transformed by evolving business practices and consumer behaviors,” Attom CEO Rob Barber said regarding the company’s January report.
Texas has seen commercial foreclosures across all asset classes as its metros grapple with the highest office vacancies of all large cities in the U.S. Since the beginning of the year, lenders have moved to foreclose on a historic office building in Downtown Fort Worth, a coworking office in Downtown Houston and other properties as older and less amenitized buildings, in particular, lose tenants to downsizing and remote work.
Houston has seen a slew of multifamily property foreclosures following a wave of inexperienced investors purchasing properties in a time of low interest rates and easy entry.
Attom began analyzing commercial foreclosure data in 2014 and saw its previous high in October of that year with 889 foreclosures nationally. However, Texas is experiencing higher numbers now.
Texas only saw 30 foreclosures in October 2014 and surpassed 50 for the first time in September 2023, the data shows. Its peak was 61 in November.
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