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CRE CLO Distress Rate Sheds 180 Basis Points

By
Michael Haas
-
0

Commercial Real Estate Collateralized Loan Obligations (CRE CLOs) continue to exhibit resilience in the face of economic headwinds, with delinquency, special servicing, and overall distress rates remaining subdued through September 2025. Drawing from CRED iQ’s proprietary dataset, this analysis highlights key metrics for CMBS and CRE CLO investors navigating portfolio risks.

Delinquency and Special Servicing Dynamics

Delinquency (DQ) rates in CRE CLOs ticked down to 9.2% in September 2025 from 10.7% in August, marking a month-over-month (MoM) decline of 150BPS. This follows a volatile H1 2025, where DQ peaked at 12.2% in February before easing. Special servicing (SS) rates mirrored this trend, falling to 7.2% from 8.2%.

The CRED iQ distress rate (DQ and/or SS) compressed to 11.5% in September, down 180 BPS  MoM and 160 bps year-over-year from September 2024’s 13.1%.

Cumulative balances underscore the scale: September’s distressed pool totaled $6.2 billion across $54.0 billion in allocated loan amounts (ALA), representing just 11.5% exposure. Compared to the 2025 low of 10.9% in June 2025, September distress increased by 60 bps.  

Payment Status Breakdown

Payment statuses reveal a maturing portfolio, with 61.3% of ALA in matured loans ($3.8 billion), split between performing (25.5%) and non-performing (35.8%) categories. Current loans hold steady at 19.2% ($1.2 billion), while late payments (<30 days DQ) are negligible at 0.5% ($31.2 million). DQ buckets dominate distress: 30-day at 12.5% of total ALA, 60-day at 0.9%, and 90+ days at 5.6%, totaling 19.0% exposure.

This distribution highlights liquidity risks in matured non-performers, yet low early-stage delinquencies (under 1% combined late/grace) suggest proactive servicing. Investors should prioritize stress testing for extension risks in leveraged deals.

CRED iQ monitoring indicates potential for further compression if rate cuts materialize, though sector-specific rotations remain. For more information, visit CRED iQ or reach out to our research team at Team@CRED-iQ.com.

Explore All CRE CLO Distressed Loans

About CRED iQ

CRED iQ is a market data provider that offers a robust suite of data and software solutions tailored for commercial real estate and finance professionals.

With over $2.3 trillion of CRE loans, CRED iQ delivers instant access to a comprehensive range of financial data and analytics for millions of properties in every market. CRED iQ’s data and analytical capabilities are instrumental in helping investors, lenders and brokers make informed and strategic decisions critical to their business.

THE DATA, INFORMATION AND/OR RELATED MATERAL (“DELIVERABLES”) IS BEING OFFERED AS-IS/WHERE-AS CONDITION. CRED-IQ MAKES NO REPRESENTATION OR WARRANTY AS TO QUALITY OR ACCURACY OF SUCH DELIVERABLES BEING PURCHASED, WHETHER EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, STATUTE, OR OTHERWISE, AND CRED-IQ SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED OR STATUTORY WARRANTIES INCLUDING WARRANTIES OF MERCHANTABILITY AND OF FITNESS FOR A PARTICULAR PURPOSE, TECHNICAL PERFORMANCE, AND NON-INFRINGEMENT. WITHOUT LIMITING THE FOREGOING, YOU AS CUSTOMER ACKNOWLEDGE THAT YOU HAVE NOT AND ARE NOT RELYING UPON ANY IMPLIED WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE, OR UPON ANY REPRESENTATION OR WARRANTY WHATSOEVER AS TO THE DELIVERABLES  IN ANY REGARDS WHATSOEVER, AND ACKNOWLEDGE  THAT CRED-IQ MAKES NO, AND HEREBY DISCLAIMS ANY, REPRESENTATION, WARRANTY OR GUARANTEE THAT THE PURCHASE, USE OR COMMERCIALIZATION OF ANY DELIVERABLES WILL BE USEFUL TO YOU OR FREE FROM INTERFERENCE. BY ACCEPTANCE OF THE DELIVERABLES, YOU HEREBY RELEASE CRED-IQ AND ITS AFFILIATES AND AGENTS FROM ALL CLAIMS, DAMAGES AND LIABILITY ARISING HEREUNDER.

Announcing WFCM 2025-C65

By
Michael Haas
-
0

A CRED iQ Preliminary Analysis

DATA HEREIN PROVIDED TO CRED IQ IS FROM A PRELIMINARY PROSPECTUS AND MAY BE AMENDED OR SUPPLEMENTED PRIOR TO TIME OF SALE

Access Loan Details

Deal Overview

The WFCM 2025-C65 CMBS deal is a new issuance securitization for the CMBS market, with a total pooled balance of $822.2 million. The deal is jointly managed by prominent financial institutions including Wells Fargo, Goldman Sachs, Societe Generale, and JP Morgan. The deal is collateralized by 23 loans and secured by 79 properties across a variety of sectors, including retail and office. The strategic geographic distribution of these properties ensures balanced exposure across major markets. The deal’s weighted average loan-to-value (LTV) ratio of 56.6%, and the weighted average mortgage interest rate is 6.33%.

Key Metrics

The loan pool for WFCM 2025-C65 is structured to include a mix of amortizing and interest-only loans, with 17.1% of the mortgage pool having scheduled amortization. The remainder of the pool (82.9%) consists of interest-only payments throughout the loan term, offering investors a steady income stream. The pool boasts a weighted average debt service coverage ratio (DSCR) of 1.91. The weighted average net operating income (NOI) debt yield is 13.2%.

Geography & Property Types

A key strength of the WFCM 2025-C65 CMBS deal is its diverse property type distribution, which enhances portfolio resilience. Retail properties constitute 42.2% of the total balance, while office properties account for 19.7% of the balance. The geographic distribution of the properties across prime markets, including high-growth areas in New York City, Los Angeles and San Francisco.

Access Loan Details

About CRED iQ

CRED iQ is a market data provider that offers a robust suite of data and software solutions tailored for commercial real estate and finance professionals.

With over $2.3 trillion of CRE loans, CRED iQ delivers instant access to a comprehensive range of financial data and analytics for millions of properties in every market. CRED iQ’s data and analytical capabilities are instrumental in helping investors, lenders and brokers make informed and strategic decisions critical to their business.

THE DATA, INFORMATION AND/OR RELATED MATERAL (“DELIVERABLES”) IS BEING OFFERED AS-IS/WHERE-AS CONDITION. CRED-IQ MAKES NO REPRESENTATION OR WARRANTY AS TO QUALITY OR ACCURACY OF SUCH DELIVERABLES BEING PURCHASED, WHETHER EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, STATUTE, OR OTHERWISE, AND CRED-IQ SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED OR STATUTORY WARRANTIES INCLUDING WARRANTIES OF MERCHANTABILITY AND OF FITNESS FOR A PARTICULAR PURPOSE, TECHNICAL PERFORMANCE, AND NON-INFRINGEMENT. WITHOUT LIMITING THE FOREGOING, YOU AS CUSTOMER ACKNOWLEDGE THAT YOU HAVE NOT AND ARE NOT RELYING UPON ANY IMPLIED WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE, OR UPON ANY REPRESENTATION OR WARRANTY WHATSOEVER AS TO THE DELIVERABLES  IN ANY REGARDS WHATSOEVER, AND ACKNOWLEDGE  THAT CRED-IQ MAKES NO, AND HEREBY DISCLAIMS ANY, REPRESENTATION, WARRANTY OR GUARANTEE THAT THE PURCHASE, USE OR COMMERCIALIZATION OF ANY DELIVERABLES WILL BE USEFUL TO YOU OR FREE FROM INTERFERENCE. BY ACCEPTANCE OF THE DELIVERABLES, YOU HEREBY RELEASE CRED-IQ AND ITS AFFILIATES AND AGENTS FROM ALL CLAIMS, DAMAGES AND LIABILITY ARISING HEREUNDER.

Announcing BMO 2025-C13

By
Michael Haas
-
0

A CRED iQ Preliminary Analysis

DATA HEREIN PROVIDED TO CRED IQ IS FROM A PRELIMINARY PROSPECTUS AND MAY BE AMENDED OR SUPPLEMENTED PRIOR TO TIME OF SALE

Access Loan Details

Deal Overview

The BMO 2025-C13 CMBS deal is a new issuance securitization for the CMBS market, with a total pooled balance of $814.2 million. The deal is jointly managed by prominent financial institutions including BMO, Deutsche Bank, KeyBanc, Goldman Sachs, Citigroup, and JP Morgan. The deal is collateralized by 47 loans and secured by 89 properties across a variety of sectors, including self storage, retail, and office. The strategic geographic distribution of these properties ensures balanced exposure across major markets. The deal’s weighted average loan-to-value (LTV) ratio of 56.9%, and the weighted average mortgage interest rate is 6.30%.

Key Metrics

The loan pool for BMO 2025-C13 is structured to include a mix of amortizing and interest-only loans, with 15% of the mortgage pool having scheduled amortization. The remainder of the pool (85%) consists of interest-only payments throughout the loan term, offering investors a steady income stream. The pool boasts a weighted average debt service coverage ratio (DSCR) of 1.85. The weighted average net operating income (NOI) debt yield is 12.4%.

Geography & Property Types

A key strength of the BMO 2025-C13 CMBS deal is its diverse property type distribution, which enhances portfolio resilience. Self storage properties constitute 29.7% of the total balance, while retail properties account for 24.7% of the balance. The geographic distribution of the properties across prime markets, including high-growth areas in New York City, Dallas, and Boston.

Access Loan Details

About CRED iQ

CRED iQ is a market data provider that offers a robust suite of data and software solutions tailored for commercial real estate and finance professionals.

With over $2.3 trillion of CRE loans, CRED iQ delivers instant access to a comprehensive range of financial data and analytics for millions of properties in every market. CRED iQ’s data and analytical capabilities are instrumental in helping investors, lenders and brokers make informed and strategic decisions critical to their business.

THE DATA, INFORMATION AND/OR RELATED MATERAL (“DELIVERABLES”) IS BEING OFFERED AS-IS/WHERE-AS CONDITION. CRED-IQ MAKES NO REPRESENTATION OR WARRANTY AS TO QUALITY OR ACCURACY OF SUCH DELIVERABLES BEING PURCHASED, WHETHER EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, STATUTE, OR OTHERWISE, AND CRED-IQ SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED OR STATUTORY WARRANTIES INCLUDING WARRANTIES OF MERCHANTABILITY AND OF FITNESS FOR A PARTICULAR PURPOSE, TECHNICAL PERFORMANCE, AND NON-INFRINGEMENT. WITHOUT LIMITING THE FOREGOING, YOU AS CUSTOMER ACKNOWLEDGE THAT YOU HAVE NOT AND ARE NOT RELYING UPON ANY IMPLIED WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE, OR UPON ANY REPRESENTATION OR WARRANTY WHATSOEVER AS TO THE DELIVERABLES  IN ANY REGARDS WHATSOEVER, AND ACKNOWLEDGE  THAT CRED-IQ MAKES NO, AND HEREBY DISCLAIMS ANY, REPRESENTATION, WARRANTY OR GUARANTEE THAT THE PURCHASE, USE OR COMMERCIALIZATION OF ANY DELIVERABLES WILL BE USEFUL TO YOU OR FREE FROM INTERFERENCE. BY ACCEPTANCE OF THE DELIVERABLES, YOU HEREBY RELEASE CRED-IQ AND ITS AFFILIATES AND AGENTS FROM ALL CLAIMS, DAMAGES AND LIABILITY ARISING HEREUNDER.

CRED iQ Market Update: Navigating CMBS Distress and Broader CRE Trends in Q3 2025

By
Michael Haas
-
0

As we move into the final quarter of 2025, commercial real estate (CRE) investors and CMBS stakeholders are closely monitoring delinquency and distress signals amid a backdrop of moderating interest rates and economic stabilization. At CRED iQ, our latest data reveals persistent challenges in certain sectors, balanced by signs of resilience elsewhere. This update draws on our comprehensive delinquency, specially serviced, and overall distress rates, alongside key market metrics from CRED iQ, to provide actionable insights for navigating this evolving landscape.

Starting with CMBS delinquency trends, our tracking shows a slight downward trend in overall distress as of September 2025. Delinquency rates stood at 8.59%, down from 9.44% in August, while specially serviced loans declined to 10.63% from 10.95%. The combined delinquent and/or specially serviced rate reached 11.28%, marking a modest decrease from 11.78% the prior month.  Looking back, this metric has hovered between 10-12% throughout 2025, a stark contrast to the sub-5% levels seen in 2022-2023. For instance, in January 2025, the combined rate was 11.50%, peaking at 11.78% in August before this slight easing. Office properties continue to drive much of this distress, with broader implications for portfolio risk management.

Drilling deeper into property-type specifics from recent CRED iQ loan and market stats (as of late September 2025), CMBS delinquency rates underscore sectoral divergences. Office loans remain the most pressured followed by Multifamily. Retail and hotel sectors showed improvement this month, while Industrial properties, buoyed by e-commerce, maintain the lowest delinquency rate. 

Beyond distress, broader market metrics paint a picture of cautious optimism. Treasury yields have stabilized, with the 10-Year at 4.18% as of late September, up from 3.80% a year prior but down from recent highs. The Fed’s rate cuts—now at 4.00-4.25% bounds—have eased borrowing costs, potentially supporting refinancing amid $957 billion in CRE maturities for 2025, led by banks ($450 billion) and CMBS/CRE CLOs ($230 billion). Cap rates tracked by CRED iQ edged higher nationally to 6.40% from 6.30% a year ago, with retail at 7.10% and office at 7.00%, while CPPI grew 0.9% YOY, indicating modest price appreciation.

Issuance volumes are a bright spot: YTD private-label CMBS hit $91.4 billion, up 26% YOY, driven by SASB ($66.9B). Agency CMBS surged 39% to $105.7 billion, with Fannie Mae and Freddie Mac leading. CRE CLOs exploded 234% to $22.7 billion, reflecting investor appetite for yield. Lending shares shifted, with agencies at 20% in 1H 2025 (down from 25% in 2024), while debt funds/REITs rose to 14%. Total CRE debt outstanding reached $6.2 trillion, dominated by banks (49%).

Economic indicators bolster this view: CPI cooled to 2.9% YOY, unemployment at 4.3%, and nonfarm payrolls added 22K in the latest month—soft but stable. For investors, these trends suggest selective opportunities in industrial and multifamily, but vigilance on office exposure. At CRED iQ, we recommend stress-testing portfolios against upcoming maturities and monitoring special servicing transfers closely. As rates potentially ease further post the October FOMC, refinancing windows may widen, but distress resolution will be key to 2026 stability.

Informed with CRED iQ

As the CRE sector continues to adapt to macroeconomic shifts, CRED iQ’s comprehensive analytics offer a critical resource for decision-makers. For a deeper dive into our data or to discuss how these trends impact your portfolio, contact our team today. Stay tuned for our next update, where we’ll continue to track the metrics driving the CMBS market.

For more information, visit CRED-iQ.com or reach out to our research team at Team@CRED-iQ.com.

Explore All Distressed Loans

About CRED iQ

CRED iQ is a market data provider that offers a robust suite of data and software solutions tailored for commercial real estate and finance professionals.

With over $2.3 trillion of CRE loans, CRED iQ delivers instant access to a comprehensive range of financial data and analytics for millions of properties in every market. CRED iQ’s data and analytical capabilities are instrumental in helping investors, lenders and brokers make informed and strategic decisions critical to their business.

THE DATA, INFORMATION AND/OR RELATED MATERAL (“DELIVERABLES”) IS BEING OFFERED AS-IS/WHERE-AS CONDITION. CRED-IQ MAKES NO REPRESENTATION OR WARRANTY AS TO QUALITY OR ACCURACY OF SUCH DELIVERABLES BEING PURCHASED, WHETHER EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, STATUTE, OR OTHERWISE, AND CRED-IQ SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED OR STATUTORY WARRANTIES INCLUDING WARRANTIES OF MERCHANTABILITY AND OF FITNESS FOR A PARTICULAR PURPOSE, TECHNICAL PERFORMANCE, AND NON-INFRINGEMENT. WITHOUT LIMITING THE FOREGOING, YOU AS CUSTOMER ACKNOWLEDGE THAT YOU HAVE NOT AND ARE NOT RELYING UPON ANY IMPLIED WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE, OR UPON ANY REPRESENTATION OR WARRANTY WHATSOEVER AS TO THE DELIVERABLES  IN ANY REGARDS WHATSOEVER, AND ACKNOWLEDGE  THAT CRED-IQ MAKES NO, AND HEREBY DISCLAIMS ANY, REPRESENTATION, WARRANTY OR GUARANTEE THAT THE PURCHASE, USE OR COMMERCIALIZATION OF ANY DELIVERABLES WILL BE USEFUL TO YOU OR FREE FROM INTERFERENCE. BY ACCEPTANCE OF THE DELIVERABLES, YOU HEREBY RELEASE CRED-IQ AND ITS AFFILIATES AND AGENTS FROM ALL CLAIMS, DAMAGES AND LIABILITY ARISING HEREUNDER.

Announcing BANK5 2025-5YR17

By
Michael Haas
-
0

A CRED iQ Preliminary Analysis

DATA HEREIN PROVIDED TO CRED IQ IS FROM A PRELIMINARY PROSPECTUS AND MAY BE AMENDED OR SUPPLEMENTED PRIOR TO TIME OF SALE

Access Loan Details

Deal Overview

The BANK5 2025-5YR17 CMBS deal is a new issuance securitization for the CMBS market, with a total pooled balance of $1 billion. The deal is jointly managed by prominent financial institutions including JP Morgan, Morgan Stanley, Wells Fargo, and Bank of America. The deal is collateralized by 44 loans and secured by 66 properties across a variety of sectors, including hospitality, multifamily and mixed-use. The strategic geographic distribution of these properties ensures balanced exposure across major markets. The deal’s weighted average loan-to-value (LTV) ratio of 57.6%, and the weighted average mortgage interest rate is 6.33%.

Key Metrics

The loan pool for BANK5 2025-5YR17 is structured to include a mix of amortizing and interest-only loans, with 17.7% of the mortgage pool having scheduled amortization. The remainder of the pool (82.3%) consists of interest-only payments throughout the loan term, offering investors a steady income stream. The pool boasts a weighted average debt service coverage ratio (DSCR) of 1.87. The weighted average net operating income (NOI) debt yield is 13.0%.

Geography & Property Types

A key strength of the BANK5 2025-5YR17 CMBS deal is its diverse property type distribution, which enhances portfolio resilience. Hospitality properties constitute 20.9% of the total balance, while multifamily properties account for 18.0% of the balance. The geographic distribution of the properties across prime markets, including high-growth areas in Denver, New York City, and Boston.

Access Loan Details

About CRED iQ

CRED iQ is a market data provider that offers a robust suite of data and software solutions tailored for commercial real estate and finance professionals.

With over $2.3 trillion of CRE loans, CRED iQ delivers instant access to a comprehensive range of financial data and analytics for millions of properties in every market. CRED iQ’s data and analytical capabilities are instrumental in helping investors, lenders and brokers make informed and strategic decisions critical to their business.

THE DATA, INFORMATION AND/OR RELATED MATERAL (“DELIVERABLES”) IS BEING OFFERED AS-IS/WHERE-AS CONDITION. CRED-IQ MAKES NO REPRESENTATION OR WARRANTY AS TO QUALITY OR ACCURACY OF SUCH DELIVERABLES BEING PURCHASED, WHETHER EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, STATUTE, OR OTHERWISE, AND CRED-IQ SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED OR STATUTORY WARRANTIES INCLUDING WARRANTIES OF MERCHANTABILITY AND OF FITNESS FOR A PARTICULAR PURPOSE, TECHNICAL PERFORMANCE, AND NON-INFRINGEMENT. WITHOUT LIMITING THE FOREGOING, YOU AS CUSTOMER ACKNOWLEDGE THAT YOU HAVE NOT AND ARE NOT RELYING UPON ANY IMPLIED WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE, OR UPON ANY REPRESENTATION OR WARRANTY WHATSOEVER AS TO THE DELIVERABLES  IN ANY REGARDS WHATSOEVER, AND ACKNOWLEDGE  THAT CRED-IQ MAKES NO, AND HEREBY DISCLAIMS ANY, REPRESENTATION, WARRANTY OR GUARANTEE THAT THE PURCHASE, USE OR COMMERCIALIZATION OF ANY DELIVERABLES WILL BE USEFUL TO YOU OR FREE FROM INTERFERENCE. BY ACCEPTANCE OF THE DELIVERABLES, YOU HEREBY RELEASE CRED-IQ AND ITS AFFILIATES AND AGENTS FROM ALL CLAIMS, DAMAGES AND LIABILITY ARISING HEREUNDER.

Announcing WFCM 2025-5C6

By
Michael Haas
-
0

A CRED iQ Preliminary Analysis

DATA HEREIN PROVIDED TO CRED IQ IS FROM A PRELIMINARY PROSPECTUS AND MAY BE AMENDED OR SUPPLEMENTED PRIOR TO TIME OF SALE

Access Loan Details

Deal Overview

The WFCM 2025-5C6 CMBS deal is a new issuance securitization for the CMBS market, with a total pooled balance of $622.7 million. The deal is jointly managed by prominent financial institutions including Wells Fargo, JP Morgan, Citigroup, Goldman Sachs, and UBS. The deal is collateralized by 26 loans and secured by 51 properties across a variety of sectors, including retail, industrial, and multifamily. The strategic geographic distribution of these properties ensures balanced exposure across major markets. The deal’s weighted average loan-to-value (LTV) ratio of 56.4%, and the weighted average mortgage interest rate is 6.49%.

Key Metrics

The loan pool for WFCM 2025-5C6 is structured to include a mix of amortizing and interest-only loans, with 5.2% of the mortgage pool having scheduled amortization. The remainder of the pool (94.8%) consists of interest-only payments throughout the loan term, offering investors a steady income stream. The pool boasts a weighted average debt service coverage ratio (DSCR) of 1.64. The weighted average net operating income (NOI) debt yield is 11.3%.

Geography & Property Types

A key strength of the WFCM 2025-C64 CMBS deal is its diverse property type distribution, which enhances portfolio resilience. Retail properties constitute 26.1% of the total balance, while industrial properties account for 18.3% of the balance. The geographic distribution of the properties across prime markets, including high-growth areas in New York City, Los Angeles, Hartford.

Access Loan Details

About CRED iQ

CRED iQ is a market data provider that offers a robust suite of data and software solutions tailored for commercial real estate and finance professionals.

With over $2.3 trillion of CRE loans, CRED iQ delivers instant access to a comprehensive range of financial data and analytics for millions of properties in every market. CRED iQ’s data and analytical capabilities are instrumental in helping investors, lenders and brokers make informed and strategic decisions critical to their business.

THE DATA, INFORMATION AND/OR RELATED MATERAL (“DELIVERABLES”) IS BEING OFFERED AS-IS/WHERE-AS CONDITION. CRED-IQ MAKES NO REPRESENTATION OR WARRANTY AS TO QUALITY OR ACCURACY OF SUCH DELIVERABLES BEING PURCHASED, WHETHER EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, STATUTE, OR OTHERWISE, AND CRED-IQ SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED OR STATUTORY WARRANTIES INCLUDING WARRANTIES OF MERCHANTABILITY AND OF FITNESS FOR A PARTICULAR PURPOSE, TECHNICAL PERFORMANCE, AND NON-INFRINGEMENT. WITHOUT LIMITING THE FOREGOING, YOU AS CUSTOMER ACKNOWLEDGE THAT YOU HAVE NOT AND ARE NOT RELYING UPON ANY IMPLIED WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE, OR UPON ANY REPRESENTATION OR WARRANTY WHATSOEVER AS TO THE DELIVERABLES  IN ANY REGARDS WHATSOEVER, AND ACKNOWLEDGE  THAT CRED-IQ MAKES NO, AND HEREBY DISCLAIMS ANY, REPRESENTATION, WARRANTY OR GUARANTEE THAT THE PURCHASE, USE OR COMMERCIALIZATION OF ANY DELIVERABLES WILL BE USEFUL TO YOU OR FREE FROM INTERFERENCE. BY ACCEPTANCE OF THE DELIVERABLES, YOU HEREBY RELEASE CRED-IQ AND ITS AFFILIATES AND AGENTS FROM ALL CLAIMS, DAMAGES AND LIABILITY ARISING HEREUNDER.

Comparing REO Levels (Today vs Great Financial Crisis)

By
Michael Haas
-
0

Today’s Q2 2025 REO (real estate owned) balances across property sectors are substantially lower than the peaks witnessed during the great financial crisis of 2008-2012, signaling a more resilient CRE environment and improved asset quality for lenders and investors. As a reminder, REO assets refers to properties (such as office buildings, retail spaces, industrial facilities, or multifamily units) that have been foreclosed upon by a lender—typically a bank or financial institution—and are now directly owned by that lender after an unsuccessful foreclosure auction or when the borrower defaults on their loan.

Q2 2025 vs. GFC REO Levels

REO balances reached extraordinary heights between 2008 and 2012, with total real estate owned surging up to over $51 billion in Q2 2011. Each major property type saw dramatic increases: nonfarm nonresidential peaked above $17 billion, with multifamily, construction, and residential sectors all seeing multi-billion dollar REO volumes. By comparison, Q2 2025 shows markedly lower balances: total REO is about $4.1 billion, with core CRE (nonfarm nonresidential) at $2.4 billion, construction at $588 million, and multifamily at $231 million.

Sector Breakdown and Trends

Core CRE: After cresting above $17 billion in Q2 2011, this sector now holds only $2.38 billion of REO, showing how far distress has receded.

Construction: The current $588 million in construction REO is a fraction of the GFC peak of over $18 billion, as riskier development loans have been managed more conservatively in recent cycles.

Multifamily and Residential: Multifamily REO hit over $2.7 billion during crisis years but sits at $231 million in 2025. 1-4 Unit Residential peaked above $13 billion in 2010, now just $852 million, reflecting more robust borrower performance and tighter underwriting.

Office Example

A four-story, 137,731-square-foot office building at 120 Mountain View Blvd in Basking Ridge, NJ, entered foreclosure after a failed balloon payment upon loan maturity in June 2024, resulting in REO status. Originally valued at $27.2 million in 2014, the property’s value plummeted to $7.7 million by mid-2025 as its occupancy dropped from 100% in 2022 to just 45.64% in March 2025, contributing to a low DSCR of 0.46 as of May 2025. With amenities like a cafeteria and garage, the asset’s financial distress led to the appointment of a receiver and foreclosure proceedings as the lender moved to resolve the non-performing matured loan transferred from the JPMBB 2014-C22 conduit

Macro Implications for Investors and Lenders

REO levels are now in line with—or lower than—pre-GFC averages, confirming that lenders are carrying far fewer distressed real estate assets on their books than before. This shrinkage reflects not only the economic growth following the crisis, but also dramatic improvements in risk management, property valuation, and loan workout strategies that have reduced the systemic build-up of troubled assets.

Opportunity and Risk Outlook

While lower REO supply suggests fewer forced-sale buying opportunities for opportunistic investors, it also signals healthier loan books for lenders and higher confidence in collateral values. Should economic headwinds intensify, early detection and workout mechanisms in today’s market will likely prevent a repeat of GFC-level asset distress, offering greater stability for commercial real estate stakeholders.

Overall, today’s REO environment tells a story of cautious optimism, where lessons from the GFC have reduced risks and left both lenders and investors better positioned to weather future shocks.

Access CRED iQ Data

About CRED iQ

CRED iQ is a market data provider that offers a robust suite of data and software solutions tailored for commercial real estate and finance professionals.

With over $2.3 trillion of CRE loans, CRED iQ delivers instant access to a comprehensive range of financial data and analytics for millions of properties in every market. CRED iQ’s data and analytical capabilities are instrumental in helping investors, lenders and brokers make informed and strategic decisions critical to their business.

THE DATA, INFORMATION AND/OR RELATED MATERAL (“DELIVERABLES”) IS BEING OFFERED AS-IS/WHERE-AS CONDITION. CRED-IQ MAKES NO REPRESENTATION OR WARRANTY AS TO QUALITY OR ACCURACY OF SUCH DELIVERABLES BEING PURCHASED, WHETHER EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, STATUTE, OR OTHERWISE, AND CRED-IQ SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED OR STATUTORY WARRANTIES INCLUDING WARRANTIES OF MERCHANTABILITY AND OF FITNESS FOR A PARTICULAR PURPOSE, TECHNICAL PERFORMANCE, AND NON-INFRINGEMENT. WITHOUT LIMITING THE FOREGOING, YOU AS CUSTOMER ACKNOWLEDGE THAT YOU HAVE NOT AND ARE NOT RELYING UPON ANY IMPLIED WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE, OR UPON ANY REPRESENTATION OR WARRANTY WHATSOEVER AS TO THE DELIVERABLES  IN ANY REGARDS WHATSOEVER, AND ACKNOWLEDGE  THAT CRED-IQ MAKES NO, AND HEREBY DISCLAIMS ANY, REPRESENTATION, WARRANTY OR GUARANTEE THAT THE PURCHASE, USE OR COMMERCIALIZATION OF ANY DELIVERABLES WILL BE USEFUL TO YOU OR FREE FROM INTERFERENCE. BY ACCEPTANCE OF THE DELIVERABLES, YOU HEREBY RELEASE CRED-IQ AND ITS AFFILIATES AND AGENTS FROM ALL CLAIMS, DAMAGES AND LIABILITY ARISING HEREUNDER.

Announcing BMARK 2025-V17

By
Michael Haas
-
0

A CRED iQ Preliminary Analysis

DATA HEREIN PROVIDED TO CRED IQ IS FROM A PRELIMINARY PROSPECTUS AND MAY BE AMENDED OR SUPPLEMENTED PRIOR TO TIME OF SALE

Access Loan Details

Deal Overview

The BMARK 2025-V17 CMBS deal is a new issuance securitization for the CMBS market, with a total pooled balance of $629 million. The deal is jointly managed by prominent financial institutions including Deutsche Bank, Goldman Sachs, Barclays, BMO, and Citigroup. The deal is collateralized by 27 loans and secured by 145 properties across a variety of sectors, including multifamily, hospitality, and office. The strategic geographic distribution of these properties ensures balanced exposure across major markets. The deal’s weighted average loan-to-value (LTV) ratio of 58.0%, and the weighted average mortgage interest rate is 6.49%.

Key Metrics

The loan pool for BMARK 2025-V17 is structured with interest-only loans, offering investors a steady income stream. The pool boasts a weighted average debt service coverage ratio (DSCR) of 1.82. The weighted average net operating income (NOI) debt yield is 12.4%.

Geography & Property Types

A key strength of the BMARK 2025-V17 CMBS deal is its diverse property type distribution, which enhances portfolio resilience. Multifamily properties constitute 35.6% of the total balance, while hospitality properties account for 20.0% of the balance. The geographic distribution of the properties across prime markets, including high-growth areas in New York City, Washington, DC, and Houston.

Access Loan Details

About CRED iQ

CRED iQ is a market data provider that offers a robust suite of data and software solutions tailored for commercial real estate and finance professionals.

With over $2.3 trillion of CRE loans, CRED iQ delivers instant access to a comprehensive range of financial data and analytics for millions of properties in every market. CRED iQ’s data and analytical capabilities are instrumental in helping investors, lenders and brokers make informed and strategic decisions critical to their business.

THE DATA, INFORMATION AND/OR RELATED MATERAL (“DELIVERABLES”) IS BEING OFFERED AS-IS/WHERE-AS CONDITION. CRED-IQ MAKES NO REPRESENTATION OR WARRANTY AS TO QUALITY OR ACCURACY OF SUCH DELIVERABLES BEING PURCHASED, WHETHER EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, STATUTE, OR OTHERWISE, AND CRED-IQ SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED OR STATUTORY WARRANTIES INCLUDING WARRANTIES OF MERCHANTABILITY AND OF FITNESS FOR A PARTICULAR PURPOSE, TECHNICAL PERFORMANCE, AND NON-INFRINGEMENT. WITHOUT LIMITING THE FOREGOING, YOU AS CUSTOMER ACKNOWLEDGE THAT YOU HAVE NOT AND ARE NOT RELYING UPON ANY IMPLIED WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE, OR UPON ANY REPRESENTATION OR WARRANTY WHATSOEVER AS TO THE DELIVERABLES  IN ANY REGARDS WHATSOEVER, AND ACKNOWLEDGE  THAT CRED-IQ MAKES NO, AND HEREBY DISCLAIMS ANY, REPRESENTATION, WARRANTY OR GUARANTEE THAT THE PURCHASE, USE OR COMMERCIALIZATION OF ANY DELIVERABLES WILL BE USEFUL TO YOU OR FREE FROM INTERFERENCE. BY ACCEPTANCE OF THE DELIVERABLES, YOU HEREBY RELEASE CRED-IQ AND ITS AFFILIATES AND AGENTS FROM ALL CLAIMS, DAMAGES AND LIABILITY ARISING HEREUNDER.

Announcing BMO 2025-5C12

By
Michael Haas
-
0

A CRED iQ Preliminary Analysis

DATA HEREIN PROVIDED TO CRED IQ IS FROM A PRELIMINARY PROSPECTUS AND MAY BE AMENDED OR SUPPLEMENTED PRIOR TO TIME OF SALE

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Deal Overview

The BMO 2025-5C12 CMBS deal is a new issuance securitization for the CMBS market, with a total pooled balance of $638.2 million. The deal is jointly managed by prominent financial institutions including BMO, Deutsche Bank, KeyBanc, UBS and Citigroup. The deal is collateralized by 45 loans and secured by 168 properties across a variety of sectors, including multifamily, office, and retail. The strategic geographic distribution of these properties ensures balanced exposure across major markets. The deal’s weighted average loan-to-value (LTV) ratio of 58.6%, and the weighted average mortgage interest rate is 6.58%.

Key Metrics

The loan pool for BMO 2025-5C12 is structured to include a mix of amortizing and interest-only loans, with 4.3% of the mortgage pool having scheduled amortization. The remainder of the pool (95.7%) consists of interest-only payments throughout the loan term, offering investors a steady income stream. The pool boasts a weighted average debt service coverage ratio (DSCR) of 1.58. The weighted average net operating income (NOI) debt yield is 10.9%.

Geography & Property Types

A key strength of the BMO 2025-5C12 CMBS deal is its diverse property type distribution, which enhances portfolio resilience. Multifamily properties constitute 28.4% of the total balance, while office properties account for 18.1% of the balance. The geographic distribution of the properties across prime markets, including high-growth areas in New York City, Houston, and Dallas.

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About CRED iQ

CRED iQ is a market data provider that offers a robust suite of data and software solutions tailored for commercial real estate and finance professionals.

With over $2.3 trillion of CRE loans, CRED iQ delivers instant access to a comprehensive range of financial data and analytics for millions of properties in every market. CRED iQ’s data and analytical capabilities are instrumental in helping investors, lenders and brokers make informed and strategic decisions critical to their business.

THE DATA, INFORMATION AND/OR RELATED MATERAL (“DELIVERABLES”) IS BEING OFFERED AS-IS/WHERE-AS CONDITION. CRED-IQ MAKES NO REPRESENTATION OR WARRANTY AS TO QUALITY OR ACCURACY OF SUCH DELIVERABLES BEING PURCHASED, WHETHER EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, STATUTE, OR OTHERWISE, AND CRED-IQ SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED OR STATUTORY WARRANTIES INCLUDING WARRANTIES OF MERCHANTABILITY AND OF FITNESS FOR A PARTICULAR PURPOSE, TECHNICAL PERFORMANCE, AND NON-INFRINGEMENT. WITHOUT LIMITING THE FOREGOING, YOU AS CUSTOMER ACKNOWLEDGE THAT YOU HAVE NOT AND ARE NOT RELYING UPON ANY IMPLIED WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE, OR UPON ANY REPRESENTATION OR WARRANTY WHATSOEVER AS TO THE DELIVERABLES  IN ANY REGARDS WHATSOEVER, AND ACKNOWLEDGE  THAT CRED-IQ MAKES NO, AND HEREBY DISCLAIMS ANY, REPRESENTATION, WARRANTY OR GUARANTEE THAT THE PURCHASE, USE OR COMMERCIALIZATION OF ANY DELIVERABLES WILL BE USEFUL TO YOU OR FREE FROM INTERFERENCE. BY ACCEPTANCE OF THE DELIVERABLES, YOU HEREBY RELEASE CRED-IQ AND ITS AFFILIATES AND AGENTS FROM ALL CLAIMS, DAMAGES AND LIABILITY ARISING HEREUNDER.

CRED iQ’s Analysis of CRE Balance Sheet Loans –Q2 2025 Update

By
Michael Haas
-
0

CRED iQ’s analysis of the most recent banking data for the second quarter of 2025 provides a comprehensive snapshot of the U.S. banking industry’s financial health. Covering 4,421 FDIC-insured commercial banks and savings institutions, including community banks with total assets of $25 trillion, the report highlights stable but modestly declining profitability, resilient deposit growth, and generally favorable asset quality amid persistent pressures in select loan portfolios.

This summary draws from the report’s key findings, with a targeted focus on commercial real estate (CRE) metrics relevant to investors and lenders. While overall banking conditions remain sound, the report flags ongoing weaknesses in CRE segments like non-owner-occupied properties and multifamily, where delinquency rates exceed pre-pandemic averages (defined as Q1 2015–Q4 2019). These insights are particularly pertinent as they underscore potential risks in CRE lending amid elevated interest rates and economic uncertainty.

Key Industry Highlights

CRED iQ’s analysis provides detailed delinquency, and net loss metrics for loans as of June 30, 2025, segmented by property types. For CRE investors and lenders, the data reveals moderate stress in key subsectors—construction and development (C&D), Core CRE (e.g., office, retail, industrial, hotel), and multifamily—amid high borrowing costs and softening demand in segments like office. Total CRE loans outstanding reached approximately $3 trillion (sum of C&D, Core CRE, and multifamily), representing about 23% of all loans. Let’s dive into these CRE metrics for all FDIC-insured banking institutions.

Core CRE (Office, Retail, Industrial, Hotel) Performance

  • 30-89 Days Delinquent: This delinquency bucket is at 0.27% for Core CRE, down from 0.34% from prior quarter, and in line with a year ago.  
  • 90+ Days Delinquent:  The 90+ days delinquency bucket is at 1.38% for Core CRE, up slightly from 1.36% from prior quarter, and in line with a year ago.   Total balance of 90+ day delinquent loans amounts to $25.8 billion for the Core CRE asset group.
  • Overall Delinquent: Combining these two delinquent buckets amounts to 1.65% overall, which is down 5 basis points from the quarter earlier.  A year ago overall delinquency for Core CRE was 1.62%, and was 0.75% in December 2019. 
  • Net Losses:  Net losses across the Core CRE properties totaled $3.92 billion (0.21%) in Q2 2025, which is up slightly from $3.88 billion last quarter, and is down from $6.0 billion (0.33%) in Q2 2024, which represents the highest amount of losses since March 2012).

Multifamily Performance

  • 30-89 Days Delinquent: This delinquency bucket is at 0.24% for multifamily loans, down from 0.42% from prior quarter, and down from 0.39% a year ago.  
  • 90+ Days Delinquent:  The 90+ days delinquency bucket remains at 1.05% for multifamily loans, the same as prior quarter, but up significantly from a year ago (0.50%).   Total balance of 90+ day delinquent loans amounts to $6.8 billion for the multifamily asset group.
  • Overall Delinquent: Combining these two delinquent buckets amounts to 1.29% overall, which is down 18 basis points from the quarter earlier.  A year ago overall delinquency for multifamily loans was 0.89%, and was 0.25% in December 2019. 
  • Net Losses:  Net losses across the multifamily properties totaled $902 million (0.14%) in Q2 2025, which is up slightly from $767 million last quarter, and doubled the amount in (0.07%) in Q2 2024.  The highest quarterly amount of losses for multifamily totaled $2.66 billion in Q4 2010. 

Construction & Development Performance

  • 30-89 Days Delinquent: This delinquency bucket is at 0.42% for C&D loans, down from 0.48% from prior quarter, and up from 0.40% a year ago.  
  • 90+ Days Delinquent:  The 90+ days delinquency bucket remains at 0.84% for C&D, up from 0.81% the prior quarter, and also up significantly from a year ago (0.59%).  Total balance of 90+ day delinquent loans amounts to $3.94 billion for the C&D asset group.
  • Overall Delinquent: Combining these two delinquent buckets amounts to 1.26% overall, which is up 3 basis points from the quarter earlier.  A year ago overall delinquency for C&D loans was 0.99%, and was 0.82% in December 2019. 
  • Net Losses:  Net losses across the C&D assets totaled $375 million (0.08%) in Q2 2025, which is up slightly from $335 million last quarter, and up from $198 million (0.04%) in Q2 2024.  The highest quarterly amount of losses for C&D totaled $24.4 billion in Q4 2009.

 

Implications for CRE Investors and Lenders

CRED iQ’s Bank Data analysis underscores a bifurcated CRE landscape: While total loan growth supports optimism, elevated noncurrent rates in Core CRE (office-heavy) and multifamily highlight refinance risks in a high-rate environment. Investors should monitor large banks’ provisioning trends, as acquisitions could mask underlying weaknesses. For lenders, focus on mid-tier and regional institutions where 90+ Day Delinquent rates are rising, and stress-test portfolios against potential net losses increases. Community banks’ strong income growth offers opportunities for partnerships, but their higher CRE concentrations warrant caution. Overall, the industry’s stability mitigates systemic risks, but selective underwriting in stressed subsectors remains critical.

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About CRED iQ

CRED iQ is a market data provider that offers a robust suite of data and software solutions tailored for commercial real estate and finance professionals.

With over $2.3 trillion of CRE loans, CRED iQ delivers instant access to a comprehensive range of financial data and analytics for millions of properties in every market. CRED iQ’s data and analytical capabilities are instrumental in helping investors, lenders and brokers make informed and strategic decisions critical to their business.

THE DATA, INFORMATION AND/OR RELATED MATERAL (“DELIVERABLES”) IS BEING OFFERED AS-IS/WHERE-AS CONDITION. CRED-IQ MAKES NO REPRESENTATION OR WARRANTY AS TO QUALITY OR ACCURACY OF SUCH DELIVERABLES BEING PURCHASED, WHETHER EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, STATUTE, OR OTHERWISE, AND CRED-IQ SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED OR STATUTORY WARRANTIES INCLUDING WARRANTIES OF MERCHANTABILITY AND OF FITNESS FOR A PARTICULAR PURPOSE, TECHNICAL PERFORMANCE, AND NON-INFRINGEMENT. WITHOUT LIMITING THE FOREGOING, YOU AS CUSTOMER ACKNOWLEDGE THAT YOU HAVE NOT AND ARE NOT RELYING UPON ANY IMPLIED WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE, OR UPON ANY REPRESENTATION OR WARRANTY WHATSOEVER AS TO THE DELIVERABLES  IN ANY REGARDS WHATSOEVER, AND ACKNOWLEDGE  THAT CRED-IQ MAKES NO, AND HEREBY DISCLAIMS ANY, REPRESENTATION, WARRANTY OR GUARANTEE THAT THE PURCHASE, USE OR COMMERCIALIZATION OF ANY DELIVERABLES WILL BE USEFUL TO YOU OR FREE FROM INTERFERENCE. BY ACCEPTANCE OF THE DELIVERABLES, YOU HEREBY RELEASE CRED-IQ AND ITS AFFILIATES AND AGENTS FROM ALL CLAIMS, DAMAGES AND LIABILITY ARISING HEREUNDER.

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