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The delinquency rate on loans in U.S. commercial mortgage-backed securities (CMBS) rose 22 basis points in July to hit 9.24 percent, according to data released Wednesday by ""Moody's Investors Service"":http://www.moodys.com.
[IMAGE]The increase follows two months in which delinquencies edged lower, and marks the seventh consecutive month Moody's has recorded a rate above the 9 percent mark.
Moody's ""calculates the delinquency rate"":http://www.moodys.com/cmbs as loans that are 60 or more days past due, matured and performing, matured and nonperforming, foreclosure in progress, or REO. The company tracks all loans in U.S. conduit and fusion deals issued in 1998 or later.
The New York-based agency says the rate of loans in special servicing fell by five basis points to 12.30 percent of the loans tracked. This was the third straight monthly decline in the special servicing number.
Even with consecutive declines, Tad Philipp, director of CRE research for Moody's, stresses that the specially
[COLUMN_BREAK]serviced loan rate remains extremely elevated. That combined with continued economic uncertainty, Philipp says, means CMBS delinquencies are likely to remain in the high single-digit range for at least the near term.
Moody's points out that there was no new CMBS conduit issuance in July to offset the loans that left the CMBS conduit/fusion universe, resulting in a $5.1 billion drop in CMBS outstanding. At the same time the delinquent loan balance increased $835 million, contributing to the rise July's delinquency rate.
The delinquency rate for hotels shrank last month, falling by 76 basis points to the current level of 15 percent. Thirty-five hotel loans were either worked out or disposed of, bringing the hotel delinquent balance to a one-year low.
The delinquency rates for office and retail both rose. Office delinquencies jumped to 7.59 percent, with delinquent balances of $14 billion. Retail delinquencies increased to
7.37 percent, carrying a balance of just under $14 billion.
Industrial delinquencies declined by almost $200 million, dropping the sector's delinquency rate to 10.77 percent. Multifamily remained approximately the same with a delinquency rate of 15.13 percent.
Delinquencies in all but two vintages from 2000-2008 period rose. The exceptions were 2003, which was down by six basis points, and 2008, down by one.
At 20.38 percent, Nevada still has the highest delinquency rate among the 50 states -- nearly two and a half times the national average. Nevada's delinquency rate declined in July by 200-plus basis points, largely driven by a 900 basis point improvement in Las Vegas.
