**Delinquency Rate Among KBRA-Rated CMBS Rises to 7.9% in August**
Kroll Bond Rating Agency (KBRA) reported on Thursday that the delinquency rate among KBRA-rated U.S. private-label commercial mortgage-backed securities (CMBS) increased to 7.9% in August, rising from 7.5% in July. Despite this uptick, the total distress rate—which includes both delinquent and current but specially serviced loans—remained stable at 10.6%.
The conduit multifamily delinquency rate saw a significant increase of 178 basis points month-over-month, rising to 7.2%. This surge was largely attributed to the Park West Village loan, which totals $254 million across six KBRA-rated conduits and includes $66.5 million in rake certificates within the BBCMS 2022-C17 deal. This loan became newly delinquent during the reporting period.
In total, $1.6 billion in CMBS loans were newly added to the distressed category in August. Of this amount, 33.8%—or approximately $556.2 million—involved actual or imminent maturity defaults. Sector-wise, multifamily properties represented the largest share of newly distressed loans at 40.8% ($672.3 million), followed by office properties at 35.7% ($588.5 million), and retail at 9.4% ($154.5 million).
Despite the multifamily sector accounting for the highest volume of newly distressed loans, the office sector posted the highest delinquency rate overall, reaching 13.2%—an increase of 140 basis points from the previous month.
A notable development included the $1-billion CMBS loan secured by 1211 Avenue of the Americas in Manhattan, which became a nonperforming balloon loan in August.
*Pictured: 1211 Avenue of the Americas in Midtown Manhattan.*
