CMBS loan delinquencies end year lower

The Scotsman Guide - Victor Whitman - 26 January 2017

The delinquency rate of loans packaged in commercial-mortgage backed securities (CMBS) ended the year lower in 2016.

The CMBS delinquency rate was 3 percent in December, down 43 basis points from a year earlier, Morningstar Credits Ratings said.

The delinquent unpaid balance totaled $23.9 billion, up $357 million from the prior month, but down 12 percent from a year earlier, Morningstar said.   

Despite the drop, Morningstar expects the delinquency rate to rise this year as a large volume of problem loans comes to maturity. More than half of the newly delinquent loans were originated in 2007, Morningstar said. Loans secured by office and retail loans represent 72.5 percent of the delinquent balance.