Fitch: Delinquency Divide Widening for U.S. CMBS 1.0 and 2.0

NEW YORK--()--U.S. CMBS delinquencies fell last month for the first time since March even though late-pays on older vintages continue to rise, according to the latest index results from Fitch Ratings.

Loan delinquencies declined by five basis points (bps) in August to 3.15% from 3.20% a month earlier. The portfolio runoff of $8.1 billion doubled Fitch-rated new issuance volume of $4 billion from six transactions in July, causing a decrease in the overall index denominator. Contributing to the majority of the 45-bp decline in the hotel delinquency rate, the largest resolution was the JQH Hotel Portfolio loan, which consists of a $127.9 million A-note (JPMCC 2006-LDP7) and an $8.4 million B-note (CD 2007-CD4).

While the overall delinquency rate has declined, CMBS 1.0 delinquencies have risen since the start of 2016 and were up for the seventh consecutive month, now nearing 11%. Over 50% of the outstanding CMBS 1.0 delinquencies are REO assets, with an average aging of approximately 23 months. The largest new delinquency was the $113.7 million SBC-Hoffman Estates loan ($55.7 million in a Fitch-rated transaction (BSCMS 2006-PWR11) and $58 million in a non-Fitch-rated transaction (MSCI 2006-TOP21)).

Current and previous delinquency rates by property type are as follows:

--Retail: 4.79% (from 4.73% in July);

--Office: 4.55% (from 4.56%);

--Hotel: 3.85% (from 4.30%);

--Multifamily: 0.79% (from 0.86%);

--Industrial: 4.05% (from 3.98%);

--Mixed Use: 4.01% (from 4.03%);

--Other: 0.72% (from 0.76%).

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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Contacts

Fitch Ratings
Mary MacNeill
Managing Director
+1-212-908-0785
Fitch Ratings, Inc., 33 Whitehall Street, New York, NY 10004
or
Melissa Che
Director
+1-212-612-7862
or
Media Relations:
Sandro Scenga, +1 212-908-0278
sandro.scenga@fitchratings.com

Contacts

Fitch Ratings
Mary MacNeill
Managing Director
+1-212-908-0785
Fitch Ratings, Inc., 33 Whitehall Street, New York, NY 10004
or
Melissa Che
Director
+1-212-612-7862
or
Media Relations:
Sandro Scenga, +1 212-908-0278
sandro.scenga@fitchratings.com