In February, CRED iQ reported a four-basis-point decline in the overall distress rate, with multifamily experiencing an 80-bp increase. This marks the largest monthly rise in this sector within the past 18 months.
One example of an apartment-related issue being monitored by CRED iQ is a $94.1-million loan for The Reserve at Brandon, a 982-unit property located in Brandon, FL. The loan became delinquent by 30 days during February.
According to CRED iQ’s findings, “The loan’s rate cap expiration date was set for April 2024 and had three available extension options at securitization.” However,”the property was added to the watchlist due to low occupancy and DSCR (reported as of September at rates of only82.3% and .41 respectively).”
During underwriting processes,the appraisal valued this multifamily community at $232.5M ($263762/unit) with potential stabilization expected by March2025.The servicer has indicated discussions regarding extending its maturity date beyond April2024.
Citing that self-storage portfolios have become current after previously being delinquent,CredIQ attributes their decrease in distress rates primarily due to one specific office space totaling$2.l-billion dollars currently facing financial issues.Pictured: A photo taken from inside The ReserveatBrandon courtesyofCushman&Wakefield.
Expert analysts from CRED iQ report that despite an overall four-basis-point decline in distress rates across various industries during February,Multifamily properties experienced an alarming increase of80 basis points.This is notably higher than any other month withinthe last year-and-a-half period analyzedby our team.
As partofour ongoing monitoring process,CredIQ highlightsa particular case involvinga$94.l-million dollarloansecuredbyTheReserveatBrandon,a well-knownmultifamilysiteconsistingof982 unitslocatedwithinFlorida’s Brandon suburb.The loan was reported to have become delinquent by 30 days in February.
According to CRED iQ, “The loan’s rate cap expiration date was set for April2024 and had three available extension options at securitization.” However,”the propertywas addedto the watchlist due to low occupancyand DSCR (reported as of September at rates of only82.3% and .41 respectively).”
During underwriting processes,the appraisal valued this multifamily communityat $232.5M ($263762/unit) with potential stabilization expectedby March2025.Servicer commentaryindicates that discussions are underway regarding extending its maturity date beyondApril 2024.
Citing a specific office space totaling$2.l-billion dollars currently facing financial issues,CredIQ attributes their decrease in distress rates primarilydue to one particular self-storage portfolio.Pictured: A photo taken from inside The ReserveatBrandon courtesyofCushman&Wakefield.
