CMBS Late-Pays Make Steeper Rise

“The ‘wall of maturities’ finally took a meaningful toll on the CMBS delinquency rate,” says Manus Clancy at Trepp.

NEW YORK CITY—The CMBS delinquency rate’s trip through gently rolling hills took a sharp upward turn in June, as Trepp LLC reported Friday that the rate experienced its steepest climb in more than five years. The 28-basis point increase to 5.75% was the biggest rise in the delinquency rate since March 2012.

“After months of marginal increases, the ‘wall of maturities’ finally took a meaningful toll on the CMBS delinquency rate,” says Manus Clancy, senior managing director at Trepp. “June’s climb is well below the rate increases regularly seen in 2010, but the reading should still be anticipated to move somewhat higher through the rest of the summer as pre-crisis loans reach their maturity dates.”