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LOS ANGELES—With civil unrest still prevalent across our country, business reopening efforts were foiled by violence and curfews. The overall jobless claims are still staggering, with nearly 2 million filed new claims while the May unemployment rate is 13.3%. Intentions with Beijing persist while Wall Street is making gains from its March lows. Some economists are declaring that the COVID-19 recession is over, but clearly the recovery is only beginning. Is the worst really behind us or has it yet to truly begin?

In April 2020, the CMBS Delinquency Rate registered at 2.29%, but now in May, the CMBS Delinquency Rate logged its largest increase since 2009 at 7.15% (a jump of 481 basis points over the April number). Almost 5% of that number is represented by loans only in the 30-day delinquent bucket. So optimistically speaking, we can hope that roughly 5% will recover in the next few months and only 2.15% will remain in severe distress. Realistically, the numbers could head higher in June considering that about 7.6% of loans by balance missed the May payment.

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