A decline in the performance of securitized commercial real estate loans was led by loans backed by offices, hotels and retail properties.
Mortgages that were at least 30 days’ delinquent made up 2.83 percent of all loans in commercial mortgage-backed securities last month.
The CMBS 30-day delinquency rate worsened, with month-over-month deterioration of 7 basis points reported compared to February.
The details were based on
$776 billion in CMBS rated by Morningstar Credit Ratings LLC.
“Light liquidation activity and newly delinquent loan volume that was more than twice the balance of cured loans caused the commercial mortgage-backed securities delinquency rate to inch higher in March after plunging the prior two months,” the Chicago-based ratings agency reported.
But loan performance has significantly improved since March 31, 2015, when the 30-day CMBS delinquency rate was 3.77 percent.
Delinquency on office properties was 4.99, deteriorating from Feb. 29, 2016, by
32 basis points — the worst month-over-month increase of any property type.
Retail property loan delinquency shot up 28 BPS from a month earlier to 2.35 percent as of March 31, 2016.
A 19-basis-point ascension in the 30-day rate on securitized hotel loans left delinquency at 2.67 percent.
The delinquency rate on CMBS loans secured by healthcare properties was up 4 BPS from February to 2.49 percent.
There was no change from the last report in industrial property delinquency, which was 4.52 percent.
Delinquency on multifamily loans declined 3 BPS to 0.63 percent.
“Morningstar Credit Ratings, LLC expects turbulence later this year when many of the maturing loans written at the height of the market will have difficulty refinancing because they remain over-leveraged,” the report warned.
