KBRA Releases Research - CMBS Loan Performance Trends: March 2024
March 28 2024 - 9:26AM
Business Wire
KBRA releases a report on U.S. commercial mortgage-backed
securities (CMBS) loan performance trends observed in the March
2024 servicer reporting period. The delinquency rate among
KBRA-rated U.S. commercial mortgage-backed securities (CMBS) in
March remained steady at 4.5%, up 2 basis points (bps) from
February. The total delinquent and specially serviced loan rate
(distress rate) also remained steady at 7.5% compared to 7.47% last
month. The minor increase in distress rate was led by multifamily
with a month-over-month (MoM) increase of 27 bps, followed closely
by office (26 bps) and lodging (19 bps).
CMBS loans totaling $1.1 billion contributed to the distress
rate this reporting period, and 39.8% ($419 million) stemmed from
imminent or actual maturity default. The office sector, as it has
done each month over the past year, represented the largest portion
(57.9%, $609.1 million) of newly distressed loans. The retail
sector came in second, accounting for 14.6% ($153.4 million) of
newly distressed loans, followed by mixed-use at 10.8% ($113.5
million).
Other key observations of the March 2024 performance data are as
follows:
- The delinquency rate increased 2 bps to 4.5% ($13.4 billion),
compared to 4.48% ($13.3 billion) in February.
- The distress rate, which increased 3 bps, was led by
multifamily (up 27 bps to 3%), although the sector is below its
peak of 4.02% at year-end 2023.
- Office continued its upward climb reaching 11.26% with a MoM
increase of 26 bps as three loans each in excess of $100 million in
unpaid principal balance were sent to special servicing.
- The retail sector saw a sizable drop in the distress rate
mainly due to the Woodbridge Center loan ($250 million original
balance in WFRBS 2014-C20 and WFCM 2014-LC16), which was disposed
of through a receiver sale resulting in a 62.353.2% loss on the
loan.
In this report, KBRA provides observations across our $314.5
billion rated universe of U.S. private label CMBS including
conduits, single-asset single borrower (SASB), and large loan (LL)
transactions.
Click here to view the report.
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- CMBS Trend Watch: February 2023
- CMBS Loan Performance Trends: February 2024
About KBRA
KBRA is a full-service credit rating agency registered in the
U.S., the EU, and the UK, and is designated to provide structured
finance ratings in Canada. KBRA’s ratings can be used by investors
for regulatory capital purposes in multiple jurisdictions.
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Aryansh Agrawal, Analyst +1 646-731-1381
aryansh.agrawal@kbra.com
Roy Chun, Senior Managing Director +1 646-731-2376
roy.chun@kbra.com
Business Development Contact
Daniel Stallone, Managing Director +1 646-731-1308
daniel.stallone@kbra.com