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CMBS delinquencies continued their steady climb to start 2024, led again by office, which clocked its highest monthly uptick in past-due loans since September.
The overall delinquency rate for CMBS loans reached 4.66%, according to Trepp, with office-backed loans increasing 48 basis points month-over-month to 6.3%.
Office delinquencies are up dramatically over their position a year ago, when 1.86% of office-backed CMBS loans were delinquent.
Multifamily delinquencies, on the other hand, declined month-over-month from 2.62% to 1.91%. Trepp's report attributes the drop to the disposition of a delinquent single-asset, single-borrower apartment loan in San Francisco.
The report doesn't name the loan, but in January, Brookfield Properties and Ballast Investments bought $915M in underwater multifamily mortgages from Veritas Investments. A portion of this was a $668M CMBS loan in a SASB package.
Retail-associated CMBS maintained its position behind office with a delinquency rate of 6.27%, a 31-basis-point downtick from last year.
Lodging-associated CMBS delinquencies have also been consistently high over the last year, ending January at 5.46% according to Trepp data.
Industrial's delinquency rate remains nearly nonexistent at 0.4%.
Overall delinquencies were up from 2.94% a year ago, but even the current 4.66% is well short of the record 10.34% in July 2012, during the aftermath of the Global Financial Crisis. In June 2020, during the early grim days of the pandemic, delinquencies rose to a brief high of 10.32%.
The percentage of CMBS loans that are seriously delinquent is 4.42%, according to Trepp, up 14 basis points from December.
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