Another month, another all-time high CMBS delinquency rate, according to data from Trepp. The company’s July 2012 U.S. CMBS Delinquency Report showed $59.5 billion in CMBS loans are now delinquent—classified as 30 days or more in arrears. This figure doesn’t include loans past the balloon date but current on interest payments.
The rate for July moved up 18 basis points to 10.36 percent, from June’s 10.16 percent, leaving $75.4 billion in loans—nearly 4,000 in all—in special servicing.
The July results seem to go against what Trepp predicted a month earlier, when senior managing director Manus Clancy said that, with most of the 2007-vintage loans already past their maturity dates, the worst might be behind us.
“Just as the heat should break by September, investors should see some relief, too,” Mr. Clancy predicted. “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.”
In light of the July numbers, Mr. Clancy said that Trepp doesn’t expect much improvement over the next few months. “We don’t anticipate many more increases in the rate over the next six months,” he said. “The loans that were unable to refinance over the last year will continue to linger with the special servicers.”
Retail was the only asset type to see improvement in July, its delinquency rate dropping to 8.03 percent for the month from 8.17 percent the month previous.