According to the latest Commercial Delinquency Report from the Mortgage Bankers Association (MBA), there has been an increase in commercial mortgage delinquencies during the second quarter of 2024. The data shows that CMBS loans experienced both the largest quarterly increase and highest delinquency rate.
Jamie Woodwell, head of commercial real estate research at MBA, stated that office loans are receiving a lot of attention as they make up $740 billion out of a total $4.7 trillion in outstanding commercial mortgage debt. Woodwell also noted that due to its size and diversity, there are significant differences within the CRE market based on factors such as property type, market location, borrower profile, lender involvement and loan age.
Based on unpaid principal balances for each loan group at end of Q2:
CMBS: 4.82% delinquent rate – up by 0.47 percentage points from Q1.
Banks and thrifts: 1.15% delinquent rate – up by 0.12 percentage points.
Fannie Mae: Unchanged at a delinquent rate of 0 .44% compared to Q1.
Life company portfolios: Down by o.o9 percentage points with a current delinquent rateof o.o43%
Freddie Mac : Up by O.O4 percentag epoints witha currentdeliquentrateofO.O38%
In summary,theoffice sector sawthehighestincreaseindelinquenciesduringQ2forcommercialmortgagesaccordingtothelatestreportfromtheMortgageBankersAssociation(MBA).
