“December Special Servicing Rate Decreases”

"December Special Servicing Rate Decreases"

In December 2023, the Trepp CMBS Special Servicing Rate decreased by six basis points to 6.78%. However, the overall trend is still on an upward trajectory as it saw a total increase of 167 bps year over year.

According to Trepp’s report, most property types experienced a decrease in their special servicing rate last month except for mixed-use properties. The mixed-use category saw an increase of 108 bps in December after falling by 104 bps in November to reach a rate of 7.74%.

Office properties showed significant improvement with its first decline in more than a year as its special servicing rate dropped from8.87%to8.45%inDecember.Retailpropertiesalsoexperiencedasubstantialdeclinewitha46basispointdropinDecemberreachingarateof9.37%.

Similarly,KrollBondRatingAgency(KBRA)reportedearlierthismonththatthedelinquencyrateforKBRA-ratedU.S.CMBSpulledbackto4.21%,fullyoffsettingNovember’s19-bpincrease.Thetotaldelinquentandspeciallyservicedloanrate(theKBRAdistressrate)alsodeclinedfromNovemberto6 .65%,adropof25bps.

According to KBRA,theimproveddistressratelargelyaffectedfiveoutofsevensectorswhilemultifamilyandindustrialpropertiesexperiencedanincreasefortwomonthsinarow.ThepostSpecialServicingRateInchesDownwardinDecemberappearedfirstonConnectCRE.

About the Publisher:
Steve Griffin is based in sunny Palm Harbor, Florida. He’s an accountant by profession and the owner of GRIFFIN Tax and REVVED Up Accounting. In addition, Steve founded Madison Avenue Technology. With a strong passion for commercial real estate, he’s also dedicated to keeping you up to date with the latest industry news.

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