In May 2024, Fitch Ratings reported a nine basis point increase in the overall U.S. CMBS delinquency rate to 2.42%, primarily due to maturity defaults of large regional mall and office loans. The retail and office delinquency rates rose by 32 bps and 26 bps respectively, with the default of a $255-million loan backed by Providence Place Mall in Providence, RI being a major contributor.
During this period, new delinquencies over 60 days totaled $1.32 billion compared to April’s volume of $1.49 billion according to Fitch data analysis. Office loans accounted for the largest share (44%; $588 million), followed by retail (41%, $536 million) and hotel (11%, $139 million). Maturity defaults made up most of these new delinquencies at 77% ($1.02 billion), while term defaults represented only about one-fourth ($305 million).
Fitch also noted an increase in resolution volume from April’s figure of$569millionto$771millioninMay.Thisincludedbringingcurrenta totalof$616millioninloans,$24millioninloanliquidations,andremovingpreviouslydelinquentloansfromtheindexthatwere now only30daysdelinquent.
However,TreppreportedadifferentCMBSdeliquencyrateof4 .97%forMay2023,a10bpsdecreasecomparedtoApril.Thisislargelyattributedtobillionsofdollarsworthofofficeresolutionsduringthemonth.Despiteimprovementoverthepastyear,theoverallCMBSdeliquencyrateisstillhigherthanitwasatthispointlastyear(3 .23%).
