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The delinquency rate for commercial mortgage-backed securities (CMBS) moved up 12 basis points in June to 10.16 percent, reaching an all-time high, according to a report from ""Trepp"":http://www.trepp.com/.
The delinquency rate includes loans 30 days delinquent or in foreclosure. In May, the rate surpassed 10 percent at 10.04 percent. A year ago, the delinquency rate was 9.37 percent and prior to breaking through the 10 percent barrier, the delinquency rate was 9.80 percent in April.
The percentage of loans seriously delinquent, or 60-plus days past due or in foreclosure, REO, or non-performing balloons, is at 9.73 percent. A year ago, the rate for seriously delinquent loans was 8.75 percent.
Trepp cited weak performance among lodging, office, and retail loans as reasons for the rise in the delinquency rate. However, the industrial segment showed improvement in June and multifamily loans remained unchanged for the month.
Late last year, Trepp predicted that the market could see an increase of 70 basis points in the short-term, and the rate has actually increased 64 basis points since late 2011.
There was one positive side to the report. Trepp stated that most five-year loans originated in 2007 were made in the first six months of that year, and so now that we are halfway into 2012, this means the number of five-year loans from 2007 are reaching their maturity dates and will fall off over the next six months.
""The soaring temperatures across the U.S. made for a very uncomfortable June in many places. With the level well over 10% now, the delinquency rate is equally uncomfortably high for CMBS investors. Driving the rate up has been the fact that only 28% of the loans from 2007 due to mature in 2012 managed to pay off in full. Just as the heat should break by September, investors should see some relief, too. Now that most of the 2007 loans coming due in 2012 have passed their maturity date, the delinquency rate should start to level off soon,"" said Manus Clancy, senior managing director at Trepp.
Currently, $59 billion in loans are delinquent.
Based in New York, Trepp is a provider of information, analytics and technology to the CMBS, commercial real estate and banking markets.
