CMBS Delinquency Rate Hits Record 9.2%

The CMBS delinquency rate hit 9.2% in December, the highest in history for U.S. commercial real estate loans in CMBS, reports analytics firm Trepp LLC.

That includes loans 30 or more days delinquent, in foreclosure or real estate owned. The new delinquency rate represents a jump of 27 basis points in December. The value of delinquent loans now exceeds $61.5 billion, according to Trepp.

The decline in the delinquency rate in October 2010 now appears to have been a blip, as the rate has since increased by 62 basis points. December’s increase comes despite the fact that new issues continued to make their way into the calculation and servicers continued to resolve troubled loans, Trepp reports.

New deals are expected to continue to put downward pressure on the delinquency rate as issuance grows in 2011. Similarly, the resolution of troubled loans will also help to lower the rate.

“Many have speculated that between the emergence of new CMBS lending, the resolution of many troubled CMBS loans and an uptick in trophy property sales, that the commercial real estate crisis was nearing its final stages,” says Manus Clancy, managing director or Trepp.

“The December delinquency rate underscored that there still may be some nasty surprises in store even as the market shows some signs of healing,” adds Clancy.

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