The  delinquency andspecial servicing rate for commercial mortgage-backed securitieshas logged the largest increase since the metric was introducedin  2009, according to a leading provider of data andanalytics  on securitized mortgages. 

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The delinquency rate forcommercial mortgage-backed securities  rose to 7.15 % inMay, according to the Trepp May CMBS DelinquencyReport. Five percent ofthose troubled loans were identified as 30 days past due. In May, $9.4 billion across 243 commercial loan notes were sent tospecial servicing, according to servicer and watchlist datacompiled by Trepp. 

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This month, initial reports of troubled commercial mortgages are centered on single-asset or single-borrower deals,most backed by  hotels or malls, Trepp reported.

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Trepp has identified four commercial properties acrossthe  country with troubled loans to watch that are 30 daysor more past due, in forbearance, held by a financial lendinginstitution after an unsuccessful foreclosure sale, or inspecial  servicing.

  • TheLipstick Building, 903 3rd Ave., New York. The building's $272 million loan was sent tospecial servicing in May for "imminent monetary default" after theground lease tenant,  Ceruzzi properties, defaulted on rent. The loan is  30 days delinquent.Wealthfund Shanghai Municipal Investments owns an 80% stake in theborrowing entity. 
  • Walden  Galleria, a  "superregional mall" in Cheektowaga,  NY.  The mall's$246.6 million loan was  moved  to specialservicing in April. The borrower's request for federal COVID-19relief is under consideration. 
  • HudsonBay/SimonJV Portfolio, 9617 Wilshire Blvd., Beverly Hills,CA.  The $850 million loan, backed by 24 Lord & Taylorstores and 10 Saks Fifth Avenue stores across thenation. The loan'sspecial servicer contends that the borrower has engaged in a seriesof corporate maneuvers that reduced the CMBS bondholders' creditprotection. 
  • AshfordOffice Complex, 951 Threadneedle St., Houston, TX. The borrower has requested  forbearance relief for the $52.9million loan, citing a disruption in operations  due toCOVID-19.  Trepp reported that the loan has beenstruggling, in part because of low occupancy rates, since2017. 

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R. Robin McDonald

Daily Report reporter R. Robin McDonald's journalism career includes stints as a staff writer at The Atlanta Journal-Constitution, The Fort Worth Star-Telegram, The Wichita Eagle, and The Anniston Star and as a trial tracker at CourtTV and CNN. She is the author of two true crime books -- Black Widow: The True Story of the Hilley Poisonings and Secrets Never Lie: The Death of Sara Tokars.