NEW YORK--(BUSINESS WIRE)--Kroll Bond Rating Agency (KBRA) releases a report on U.S. commercial mortgage-backed securities (CMBS) loan performance trends observed in the May 2021 servicer reporting period. The May delinquency rate fell to 5.4%, down from 5.6% in April. This is the 11th consecutive month where the rate has declined or was flat from the previous month since peaking in June 2020, at 8.2%.
Lodging recorded the highest delinquency decrease (100 bps), followed by multifamily (40 bps). The large drop in the lodging delinquency was mainly driven by nearly $600 million of conduit lodging loans becoming current in May. The retail delinquency rate increased 30 bps, to 8.2%% from 7.9% in April. A look at the conduit universe showed that delinquencies declined to 6.5%, down 30 bps from the April delinquency rate of 6.8%. The drop reflects approximately 9.2% of April’s delinquent loans becoming classified as current for May.
The amount of conduit loans in special servicing decreased to $19 billion in May from $19.7 billion in April. This is the largest one-month decline since the beginning of the pandemic and the first time it has dropped below $19.5 billion since October 2020. In addition, the amount of delinquent loans that are not in special servicing is also at its lowest point since March 2020.
Click here to view the report.
- Appraisals for Distressed CRE Continue to Trend Lower in COVID’s Wake
- First CRE Securitizations Converting to SOFR
- CMBS Trend Watch: April 2021
KBRA is a full-service credit rating agency registered in the U.S., the EU and the UK, and is designated to provide structured finance ratings in Canada. KBRA’s ratings can be used by investors for regulatory capital purposes in multiple jurisdictions.