Fitch: U.S. CMBS Delinquencies Remain Stable
Loan delinquencies inched down another basis point last month to 4.52% from 4.53% a month earlier. The dollar balance of late-pays fell $224 million to $16.9 billion from $17.1 billion in July.
Loans from legacy transactions continue to dominate the index with the rate for CMBS 1.0 (issued before 2009) at 10.16% of the outstanding 1.0 universe versus just 0.07% for CMBS 2.0 (post-2009). Fitch's rated 2.0 universe ($209 billion) now far exceeds its rated 1.0 universe ($165 billion). CMBS 2.0 continues to have minimal delinquencies overall while the legacy 1.0 portfolio has been subject to adverse selection.
Overall resolution and delinquency activity picked up last month, with resolutions of $884 million outpacing new delinquencies of $704 million. Fitch-rated new issuance volume of $2.5 billion in July (two transactions) was exceeded by $6.6 billion in portfolio runoff, causing a decrease in the index denominator.
The largest new delinquency was the $163.75 million Jericho Plaza (I & II) loan (office; CSMC 2007-C5), which fell 60 days past due in August. Meanwhile, the largest resolution last month was the previously $269 million Empirian Portfolio Pool 2 (multifamily; MLCFC 2007-8), which was modified at the end of July and split into a $205 million A note and $111.9 million B note.
Current and previous delinquency rates by property type are as follows:
--Retail: 5.48% (from 5.41% in July);
--Hotel: 5.27% (from 5.34%);
--Office: 5.04% (from 4.73%);
--Industrial: 4.90% (from 4.87%);
--Multifamily: 4.55% (from 4.90%);
--Mixed Use: 3.58% (from 3.61%);
--Other: 1.04% (from 1.12%).
Additional information is available in Fitch's weekly e-newsletter, 'U.S. CMBS Market Trends', which also contains recent rating actions and an overview of newly released CMBS research, including Fitch presales and Focus reports. The link below enables market participants to sign up to receive future issues of the E-newsletter:
'http://pages.fitchemail.fitchratings.com/CMBSMktOptin/'
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