Delinquency rates for commercial real estate loans continued to rise in the second quarter, the Mortgage Bankers Association (MBA) says in a new report.
The delinquency rate on loans held in commercial mortgage-backed securities (
The rate for multifamily loans held or insured by Freddie Mac and at least 90 days past due rose from 0.09% to 0.11% between the first and second quarters. At the same time, the delinquency rate for loans held by FDIC-insured banks and thrifts and which were at least 90 days past due rose from 2.28% to 2.92%.
“The economic fallout of the recession continued to push commercial and multifamily delinquency rates higher during the second quarter,” said Jamie Woodwell, vice president of commercial real estate research at MBA, in a statement.
“Lower levels of employment, the pullback by consumers and other aspects of the slowdown translated into a difficult operating environment for many income-producing properties. That in turn has led to increased stress on the loans those properties support.”
To determine the delinquency rates, MBA examined commercial and multifamily delinquency rates for five of the nation’s largest investor groups, including
Based on the unpaid principal balance of loans, at the end of the second quarter, the delinquency rate for CMBS was 3.89%, reflecting loans at least 30 days past due or owned by banks. For banks and thrifts, the delinquency rate for loans at least 90 days delinquent was 2.92%, MBA reports.
For life company portfolios at least 60 days delinquent, the rate was 0.15%. Fannie Mae loans at least 60 days in arrears had a 0.51% delinquency rate at the end of the second quarter, while banks and thrifts recorded a 2.92% delinquency rate for loans 90 or more days past due.
Each investor group tracks delinquencies by its preferred method and length of time past due, MBA notes.