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Analysis

Special Servicing Rate Tops 7% and Retail Is a Reason

That’s the first time in 2.5 years, according to Trepp. And retail was supposed to be doing well.

Another month, another increase in the special servicing rate, according to Trepp. Between January and February, it rose to 7.14%, the first time in nearly three years that it topped 7%. The same time in 2023, the rate was 5.18%, while at 6.67% six months ago.

Split that into CMBS 1.0 and CMBS 2.0+ and the respective rates are 23.40% and 7.03%, showing the more conservative underwriting of the latter. And the increases are largely a factor of three property sectors: office, mixed-use, and retail.

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Erik Sherman

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