Fitch: U.S. CMBS 2.0 Delinquencies Inch Up While Overall Rate Remains Flat
OREANDA-NEWS. While the overall U.S. CMBS delinquency rate remained relatively unchanged in March, CMBS 2.0 delinquencies are seeing a modest uptick, according to the latest index results from Fitch Ratings.
Loan delinquencies fell one basis point in March to 2.90% from 2.91% a month earlier. Fitch-rated new issuance volume of $6.9 billion in February (from seven transactions) exceeded the portfolio runoff of $5.1 billion. Fitch has observed an increase in the CMBS 2.0 delinquency rate over the past few months:
--0.10% in March 2016;
--0.08% in February 2016;
--0.07% in January 2016
--0.05% at YE 2015.
Property type composition of current outstanding CMBS 1.0 and CMBS 2.0 delinquencies are vastly different. CMBS 1.0 delinquencies consist primarily of retail (39% of total CMBS 1.0 delinquency balance) and office (32%), while CMBS 2.0 delinquencies consist primarily of multifamily (48% of total CMBS 2.0 delinquency balance) and hotel (17%). The 2.0 delinquencies, not surprisingly, are mostly in energy-dependent markets where in many cases the properties and the communities were recently built.
Current and previous delinquency rates by property type are as follows:
--Retail: 4.45% (from 4.67% in February);
--Office: 4.08% (from 4.03%);
--Hotel: 3.20% (from 3.11%);
--Multifamily: 0.92% (from 0.84%);
--Industrial: 3.49% (from 3.48%);
--Mixed Use: 3.25% (from 3.25%);
--Other: 0.78% (from 0.73%).
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