Fitch: Mods Bring Down CMBS Delinquency Rate in July

An increase in loan modifications led to fewer delinquencies for commercial mortgage-backed securities (CMBS) in July, according to ""Fitch Ratings"":http://www.fitchratings.com/web/en/dynamic/fitch-home.jsp.

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The decrease in CMBS delinquencies is the second consecutive month of declines as CMBS delinquencies fell to 8.48 percent in July, a drop of 14 basis points (bps) from June's 8.62 percent.

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According to the ratings agency, two large loan mods helped bring down the past due rate â€" the $305 million Schron Industrial Portfolio and the $210 million Savoy Park.

Unlike other types of commercial properties, hotel CMBS saw an increase of 24 bps in July. Fitch explained this was due to 11 new loans totaling $280 million rolling into delinquency status.

The office sector fared well after 42 office loans totaling $512 million became performing loans, but the improvement is not expected to last, according to Fitch.

""Delinquencies on office properties enjoyed a bit of a reprieve this past month, though it is not likely to last,"" said Managing Director Mary MacNeill.

*CMBS Delinquency Rates for July and June*

Multifamily: 10.89% from 11.64% in June
Hotel: 11.46% from 11.22% in June
Industrial: 8.68% from 9.93% in June
Office: 8.43% from 8.58% in June
Retail: 7.40% from 7.67% in June