The delinquency rate for commercial mortgage-backed securities (CMBS) took on its biggest decline of the year in March, according to new data from Trepp LLC.
What Happened: Last month’s CMBS delinquency rate was 3.14%, a 37 basis points (bps) decline from April. The rate has been plummeting for 22 of the last 23 months, with only a brief uptick in late 2021.
“At the current improvement rate, the overall delinquency rate could fall below 3% in the coming months, a prospect that seemed unthinkable during the COVID-19 pandemic,” said Manus Clancy, senior managing director at Trepp. “As a refresher, the delinquency rate hit 10.32% in June 2020 amid the market volatility caused by the pandemic. This was near the all-time high of 10.34% seen in July 2012.”
See Also: Housing Beat: Mortgage Rates Flatten As Sun Belt Sees New Boom In Home Building
How It Happened: All of the major commercial property sectors saw improvements in May, with the greatest declines recorded in the retail sector (down 79 bps to 6.97%) and lodging sector (down 51 bps to 5.83%).
Other sectors recording declines in their delinquency rates were multifamily (down 18 bps to 1.01%), office (down 8 bps to 1.63%) and industrial (down 8 bps to 0.38%).
“Year-over-year, the overall U.S. CMBS delinquency rate is down 302 bps,” said Clancy.
Photo: Pete Linforth / Pixabay
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
