CMBS Delinquencies Decrease for Third Month in Past Four

After rising in July, CMBS delinquencies picked up their downward trend again in August, decreasing 36 basis points to 9.52 percent. This drop is the third in the past four months, according to analysis from Trepp LLC, a New York-based provider of commercial real estate data.

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Serious delinquencies also declined for the month and now make up 8.79 percent of commercial mortgage loans.

According to Trepp, August's decline was the largest recorded since 2008 when the credit crisis began.

Trepp attributes part of July's rise in delinquencies to a change in reporting methods by special servicers. According to the firm, special servicers began labeling dual tracked loans - those for which modification and foreclosure actions are being pursued - as ""in foreclosure.""

In August, the special servicers revised the labels, returning to their previous method, causing the rate to decline once again.

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However, though the overall CMBS delinquency rate fell from July to August, the August rate is still above the June measurement of 9.37 percent.

The August rate of 9.52 percent also demonstrates an increase from a year ago when the rate was 8.92 percent.

Among CMBS loans not in defeasance, the delinquency rate was 9.98 percent, a decline of 40 basis points from the previous month.

Of the major proper types, multifamily properties had the highest percentage of delinquencies, while retail properties had the lowest.

While multifamily properties continued to perform worse that the other major property types - with a delinquency rate of 16.44 percent - multifamily delinquencies did post a decline from last month's 16.94 percent and June's 16.48 percent.

Retail delinquencies in August were 7.38 percent, down from 7.85 percent in July and 7.82 percent in June.

Despite the variance in measurement from July to August, office delinquencies remained the same â€" 8.17 percent, having risen from 7.35 percent in June.

Industrial property delinquencies have posted increases in both July and August. The rate is now 11.24 percent.

Delinquencies on loans for lodging properties have declined since last month and are also below June's numbers before the special servicers changed their labeling method.

From June to July, lodging delinquencies rose from 13.87 percent to 15.04 percent. The rate declined to 13.76 percent in August.