BOSTON—Prices of loans underlying the CMBS universe held steady in October, DebtX said Monday. The previous month had seen a decline of a few basis points, which managing director Will Mercer attributed to “an upward shift in the Treasury yield curve.”
By contrast, Mercer says, CMBS prices remained flat month over month in October. “Prices are up a few points from the same time last year, reflecting consistent improvement in the health of CMBS loans in general,” he says.
As of the end of October, Boston-based DebtX had priced $859 billion in commercial real estate loans that collateralize US CMBS trusts. The estimated price of whole loans securing this universe remained at 95.8% at the end of October, unchanged from the end of September, when they dipped from 96% the month prior. Prices were 92.3% in October 2013.
Median adjusted loan-to-values in October decreased slightly to 59% from 60% in September, with median debt service coverage ratios holding at 1.42. Median estimated loan yields decreased to 4.2%, compared to 4.4% in September.
Affirming the general health of the CMBS market, Fitch Ratings said Friday that the delinquency rate for securitized commercial mortgages declined for a fourth straight month, edging closer to the 4.5% mark. CMBS late-pays declined by six bps in November to 4.64% from 4.70% a month earlier.
November's pace of resolutions—$539 million--surpassed new delinquencies of $384 million. Meanwhile, Fitch-rated new issuance volume of $4.5 billion edged out $4.4 billion in portfolio runoff during November.
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