According to Kroll Bond Rating Agency (KBRA), the delinquency rate for CMBS loans in the United States that are rated by KBRA slightly decreased in August, dropping 11 basis points from July to 4.98%. However, there was an increase of 32 bps in the overall distress rate, which includes both delinquent and specially serviced loans.
In August, a total of $1.7 billion worth of CMBS loans were added to the distress rate. Of this amount, over half (64.6%) was due to imminent or actual maturity default. The office sector had the highest number of newly distressed loans at 54.5% ($928 million), followed by multifamily at 29/4% ($500 million) and retail at 11/9% ($203 million).
While office properties had a higher dollar value for new CMBS distress this month compared to other sectors, KBRA noted that multifamily saw a significant increase in its distress rate: up by100 bps after declining by110 bps in July.The rise can be attributed partlytothe additionof20 Broad St., valuedat$220millionandpartofthe$1/billionHamlet2020-CRE1,tothespeciallyservicedloanslist.Sixloanstotaling$141/millionwerealsodelinquentinJunebutwerelaterbroughtcurrentinJulybeforebeingtransferredtospecialservicing.
Pictured:20BroadSt.inManhattan’sFinancialDistrict.Photo courtesyofATTCK.
The postCMBSDistressRateRises32BPsinaugustappearedfirstonConnectCRE.
