Source: Trepp / #RealEstate #Finance
NEW YORK, NY - Trepp, LLC, the leading provider of information, analytics and technology to the CMBS, commercial real estate and banking markets, released its April U.S. CMBS Delinquency Report.
The delinquency rate for U.S. commercial real estate loans in CMBS fell 47 basis points to 9.03% in April – the lowest since November 2010. Moreover, in a significant departure from the upward movement in March, April's numbers log the biggest one-month drop in the delinquency rate since 2009 when Trepp began releasing its report.
A confluence of factors contributed to significant downward pressure across the board. Loan resolutions of $1.6 billion, payoffs of $800 million, and loans that cured as a result of several large loan modifications put downward pressure of 80 basis points on the rate.
Additionally, newly delinquent loans were well below previous months' averages, lessening the upward pressure the market has experienced in the early months of 2013.
"Everything is working for the CMBS market right now, and the result is a sharp drop in delinquencies," said Manus Clancy, senior managing director at Trepp. "Spreads remain low, allowing many formerly marginal properties to get refinancing. Special servicers are continuing to resolve many distressed assets with modifications and the pace of liquidation remains high. All of these factors should continue to push the rate steadily downward."
According to the Trepp report, all major property types saw their rates drops last month. The biggest downward movement came from the lodging and multi-family segments as a result of payoffs, curing and restructuring, which are detailed in the report available at Trepp.com.