Delinquency Rate Increases for 1st Time in 6 Months

The overall delinquency rate for US commercial real estate loans in CMBS is now 3.4 percent, an increase of one basis point from the September reading.
Source: Trepp

The Trepp CMBS Delinquency Rate took a timeout from its consistent improvement in October. The overall rate inched higher after falling in six straight months and 14 of the last 15 months prior to October. The overall delinquency rate for US commercial real estate loans in CMBS is now 3.4 percent, an increase of one basis point from the September reading.

The October 2018 rate is 179 basis points lower than the year-ago level. Year-to-date, the reading has fallen 147 basis points. The post-crisis low of 3.4 percent was set last month. The all-time high of 10.3 percent was registered in July 2012.

The percentage of loans that are seriously delinquent (60 or more days delinquent, in foreclosure, REO, or non-performing balloons) is now 3.4 percent, up three basis points from September. If defeased loans were taken out of the equation, the overall 30-day delinquency rate would be 3.5 percent, two basis points higher month over month. One year ago, the US CMBS delinquency rate was 5.2 percent (down 179 basis points since then).

Manus Clancy is Senior Managing Director of Applied Data & Research