According to the Mortgage Bankers Association’s (MBA) latest commercial real estate finance (CREF) Loan Performance Survey, delinquency rates for mortgages backed by commercial properties experienced a slight increase in the third quarter of 2024. The largest quarterly increase was seen in office loans. Overall, the delinquency rate rose from 3% to 3.2% compared to Q2.
Office loans had the highest delinquency rate at the end of Q3, rising from 7.1% to 7.8%. Multifamily saw a small increase of ten basis points, reaching a delinquency rate of 1.2%.
On the other hand, there were decreases in loan delinquencies for lodging, retail and industrial properties during this time period. Retail had previously exceeded a ten percent delinquent rate during pandemic times while lodging peaked above twenty percent but is now currently second with a still high five point six percent.
Jamie Woodwell who heads MBA’s commercial real estate research stated that “The commercial mortgage market is vast and diverse with various property types such as sizes and ages along with geographic markets.” He also mentioned that these differences have affected loan performance both positively and negatively.
