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Multifamily Distress Volumes Hits 12-Year High

By
Michael Haas
-
0

New CRED iQ Analysis from Community Bank loans dives deep into loan performance of the multifamily sector

CRED iQ’s latest analysis of multifamily loans held by community bank loans shows a dramatic rise in delinquent loans and realized losses.  CRED iQ’s data shows that over $6.1 billion of community bank loans secured by apartment buildings are delinquent.  The $6.1 billion of delinquent loans yields a 0.97% delinquency rate based on total multifamily loan amount of $629.7 billion.  CRED iQ’s definition of delinquency  includes any loan that reported a payment later than 30 days, 60 days, or 90 days or worse for this analysis. 

The last time there was over $6 billion of delinquent apartment loans held by community banks was in March 2012.  During the peak in the great financial crisis of 2008-2010, apartment distress totaled $12.7 billion in March 2010.  At that time, multifamily’s delinquency rate rose to 5.9%.  It took about 4 years for the spike in delinquency to drop back down to less than 1.0%. 

CRED iQ also examined losses attributed to apartment loans with community banks.  As of September 30, 2024, total losses amounted to $504 million, the highest level since 2013.  Quarterly realized losses for apartment loans reached its peak in December 2010 when it recorded losses of $2.6 billion.  Realized losses have been steadily trending upwards for 8 straight quarters according to CRED iQ’s analysis. 

Community Bank vs CMBS Performance

CRED iQ’s latest data, tracking over $2 trillion in CRE loans, shows a marked uptick in multifamily distress. As of January 2025, the distress rate for multifamily properties within the CMBS (Commercial Mortgage-Backed Securities) universe jumped to 12.9%—a 40-basis-point increase from December 2024. That’s a stark contrast to January 2024, when the rate lingered at a modest 2.6%. Distress here combines delinquency (loans 30+ days late) and special servicing (loans flagged for potential trouble), offering a broader lens than delinquency alone.

Breaking it down, CRED iQ’s April 2024 report offers a historical pivot point: multifamily distress spiked from 3.7% to 7.2%, driven by a massive $1.75 billion loan tied to San Francisco’s Parkmerced complex. Fast forward to January 2025, and the trend has only accelerated. While exact delinquency figures vary by month, the trajectory suggests multifamily is grappling with pressures that aren’t letting up.

Delinquency rates for multifamily loans, particularly those tied to CMBS, have been ticking upward in recent months. According to CRED iQ, a leading CMBS data provider, the multifamily delinquency rate hit 4.5% in January 2025—up from 3.8% a year prior.

The Federal Reserve’s rate hikes in 2022–2023 are still rippling through the market. Many multifamily loans originated in the low-rate era are now maturing or facing refinancing at higher costs. Owners who locked in 2–3% rates a few years back are staring down 5–6% today, straining cash flows—especially for properties with slim margins or high leverage.

What’s the outlook? CRED iQ’s data suggests 2025 could be a bumpy ride. With $500 billion in CRE loans maturing this year (a stat echoed across industry reports), multifamily faces a refinancing cliff. If rates ease—say, a 25-basis-point cut by mid-2025—some pressure might lift. But oversupply won’t vanish quickly, and big loans like Parkmerced’s (another recent default) could linger as distressed if unresolved. CRED iQ’s distress rate hit a record 11.5% across all CRE in January 2025; if multifamily keeps pacing ahead, we might see 14–15% by year-end absent a major turnaround.

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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.

Cap Rate Trends are Steadily Increasing

By
Michael Haas
-
0

The CRED iQ research team focused upon the underwriting of the latest market transactions.  We wanted to understand the key loan metrics across this universe to get a real-time sense of the current environment and lending trends.     

CRED iQ analyzed underwriting metrics for the latest new issue CMBS conduit deals issued since our previous report in October. We reviewed 819 properties associated with 284 new loans totaling just over $7 billion in loan originations that have been packaged into CMBS securitizations. Our analysis examined cap rates, interest rates, and debt yields.  We further broke down these statistics by property type.

Cap Rate Analysis

Office cap rates ranged from 4.60% to 10.50% with an average of 7.40%, which is up from 7.16% in Q3 2024.  Multifamily cap rates ranged from 3.90% to 7.60% with an average of 5.90%, which is up from an average of 5.77% in Q3 2024.  Retail cap rates ranged from 5.00% to 9.10% with an average of 6.70%, which is up from an average of 6.45% in Q3 2024.

Cap Rates for industrial assets ranged from 5.20% to 7.70% with an average of 6.40%, which is up from 6.24% the previous quarter.  Self storage cap rates ranged from 5.30% to 7.60% with an average of 6.20%, which is up from an average of 5.86% in Q3 2024.  Hotel cap rates ranged from 3.30% to 10.60% with an average of 7.30%, which is down from an average of 7.80% in Q3 2024.  The hotel segment was the only one with a downward trend on average cap rates. 

Interest Rate Analysis

Office interest rates ranged from 3.40% to 7.90% with an average of 6.70%, which is up from 6.90% in Q3 2024.  Interest rates for multifamily loans in CMBS deals ranged from 5.20% to 7.70% with an average of 6.60%, which is up slightly from an average of 6.55% in the prior quarter.  Retail interest rates ranged from 3.70% to 7.90% with an average of 6.50%, which is down from an average of 6.58% in Q3 2024.

Average interest rates for industrial assets ranged from 3.50% to 7.90% with an average of 6.40%, which is slightly down from 6.45% the previous quarter.  Self storage interest rates ranged from 5.50% to 7.20% with an average of 6.30%, which is down slightly from an average of 6.34% in Q3 2024.  Hotel rates ranged from 5.50% to 8.00% with an average of 6.90%, which is down from an average of 7.00% in Q3 2024. 

Debt Yield Analysis

Debt yield trends for offices ranged from 8.50% to 17.10% with an average of 13.0%, which is down from 13.2% in Q3 2024.  Average debt yields for multifamily loans in CMBS deals ranged from 7.50% to 14.40% with an average of 9.50%, which is down from an average of 9.93% in the prior quarter.  Retail debt yields ranged from 8.30% to 17.80% with an average of 11.60%, which is up slightly from an average of 11.55% in Q3 2024.

Comparing loan volumes to our October report, the self storage segment saw a 254% increase in properties –the highest of all property types.  Hospitality came in second with a 147% increase.  Meanwhile multifamily and office notched the greatest decrease in property/loan volumes at -55% and -50% respectively.  From a deal balance perspective, self storage saw the greatest increase since October (+103%), while hospitality (-29%) and office (-27%) logged the biggest decreases. 

Access CRED iQ Today

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 BBCMS 2025-5C33

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 BBCMS 2025-C33 CMBS deal is a new issuance securitization for the CMBS market, with a total pooled balance of $892.4 million. The deal is jointly managed by prominent financial institutions including Barclays, Citigroup, Deutsche Bank, Goldman Sachs, KeyBank, and Societe Generale. The deal is collateralized by 44 loans and secured by 100 properties across a variety of sectors, including mixed use, self storage, 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 57.9%, and the weighted average mortgage interest rate is 6.64%.

Key Metrics

The loan pool for BBCMS 2025-C33 is structured to include a mix of amortizing and interest-only loans, with 6.5% of the mortgage pool having scheduled amortization. The remainder of the pool (93.5%) 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 1.62. The weighted average net operating income (NOI) debt yield is 11.5%.

Geography & Property Types

A key strength of the BBCMS 2025-C33 CMBS deal is its diverse property type distribution, which enhances portfolio resilience. Mixed use properties constitute 22.8% of the total balance, while self storage properties account for 16.8% of the balance. The geographic distribution of the properties across prime markets, including high-growth areas in New York City, San Francisco, and Miami.

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-C11

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-C11 CMBS deal is a new issuance securitization for the CMBS market, with a total pooled balance of $906.9 million. The deal is jointly managed by prominent financial institutions including BMO, SG Americas, Deutsche Bank, Citigroup, Barclays, Goldman Sachs, and UBS. The deal is collateralized by 63 loans and secured by 73 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 54.9% and the weighted average mortgage interest rate is 6.59%.

Key Metrics

The loan pool for BMO 2025-C11 is structured to include a mix of amortizing and interest-only loans, with 34.9% of the mortgage pool having scheduled amortization. The remainder of the pool (65.1%) 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 1.80. The weighted average net operating income (NOI) debt yield is 13.3%.

Geography & Property Types

A key strength of the BMO 2025-C11 CMBS deal is its diverse property type distribution, which enhances portfolio resilience. Multifamily properties constitute 28.7% of the total balance, while office properties account for 16.7% of the balance. The geographic distribution of properties across prime markets, including high-growth areas in New York City, Los Angeles, 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.

CRE CLO Distress Rate Tops 15%

By
Michael Haas
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0

The sector added 130 Basis Points this month – Reaching a New Record

The CRED iQ CRE CLO distress rate added 130 basis points in January – reaching a new high of 15.1%. A year ago, the distress rate was only 8.6% but has been steadily rising as these floating rate loans are failing to pay off at their maturity dates.  Underpinning the distress rate, December’s delinquency rate came in largely flat at 11.7%; while the special servicing rate saw a slight decrease from 9.0% to 8.8% following a 180-basis point increase last month.

The CRED iQ distress rate includes any loan reported 30 days delinquent or worse, past their maturity, specially serviced, or a combination of these.  We also examined the most recent property-level net operating income figures and compared them to underwritten expectations.

Payment Status

Looking across payment status in December, 33.4%  of loans are performing matured (mostly flat to last month).   25.6% of loans were non-performing matured (down from 31.6%  last month); therefore,  59% of the CRE CLO loans in our study are past their maturity dates, (down from 65.3% in last month’s report). About 18.8% of the CRE CLO loans are current.  Combining Late/Grace Period + less than 30 days delinquent, the percentage increases to 22.1%. 

Delinquent loans that have not past their maturity date accounted for 22.1% of the CRE CLO delinquent loans — up from 20.1%  in the previous month.

Analysis Scope & Methodology

CRED iQ consolidated all of the loan-level performance data for every outstanding CRE CLO loan to measure the underlying risks associated with these transitional assets. Our team examined $75.6 billion in active CRE CLO loans. Many of these loans were originated in 2021 at times where cap rates were low, valuations high, low interest rates, and are starting to run into maturity issues given the spike in rates.

Some of the largest issuers of CRE CLO debt over the past five years include MF1, Arbor, LoanCore, Benefit Street Partners, Bridge Investment Group, FS Rialto, and TPG. The vast majority of the $79.1 billion in CRE CLO loans are structured with floating rates with 3-year loan terms equipped with loan extension options if certain financial hurdles are met.

Try CRED iQ Today

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.

Announcing WFCM 2025-C64

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

Deal Overview

The WFCM 2025-C64 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, BMO, Citigroup, Goldman Sachs, JP Morgan, Societe Generale, and UBS. The deal is collateralized by 32 loans and secured by 62 properties across a variety of sectors, including hospitality, retail, 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 54.2%, and the weighted average mortgage interest rate is 6.64%.

Key Metrics

The loan pool for WFCM 2025-C64 is structured to include a mix of amortizing and interest-only loans, with 30.8% of the mortgage pool having scheduled amortization. The remainder of the pool (69.2%) 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 1.80. The weighted average net operating income (NOI) debt yield is 13.3%.

Geography & Property Types

A key strength of the WFCM 2025-C64 CMBS deal is its diverse property type distribution, which enhances portfolio resilience. Hospitality properties constitute 28.4% of the total balance, while retail properties account for 23.8% of the balance. The geographic distribution of the properties across prime markets, including high-growth areas in New York City, Chicago, and San Francisco.

Access Loan Details

For CRED iQ Subscribers

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 Overall Distress Rate Reaches a Fifth Straight Record High

By
Michael Haas
-
0

Overall Distress Rate Reaches 11.5%, Adding 90 Basis Points in January 2025

The CRED iQ research team evaluated payment statuses reported for each loan (securitized by CMBS financing), along with special servicing status as part of our monthly distress update.

The CRED iQ overall distress rate added 90 basis points, continuing the upward trend by logging its fourth straight record high of 11.5%.   The CRED iQ delinquency rate ticked up from 10.6% in the December print to 11.5%.  The CRED iQ special serving rate added 50 basis points this month and now stands at10.3%.  A year prior, the special servicing rate was 6.7%. 

Segment Review

Following its largest overall distress rate increase of the year in December, the office segment’s overall distress rate continued to climb; albeit more modestly adding 50 basis points to 17.7%.   Office maintains its decisive leadership as the most distressed property type.

The data shows the self-storage category roaring to the second position with a 14.2% overall distress rating (after spending most of the year below 1%).  

This is misleading due to a portfolio consisting of 16 self-storage properties in the Chelsea submarket of NYC is backed by a $2.08 billion single borrower loan. Failure to payoff at the January 2025 maturity date led to a performing matured payment status. Servicer commentary indicates the first of three one-year extension options is being exercised.

Multifamily saw a 40 basis point increase to 12.9% — a clear second place (putting aside the self-storage anomaly).  The multifamily segment was at a 2.6% distress rate in January 2024.

Retail turned in a mostly flat month-over-month print at 10.8%–enough to hold on to third place. 

Not far behind and closing fast is the hotel segment which added another 50 basis points, notching a 10.4% overall distress rate

Retail was one of three property types that improved their distress rate.   Retails distress rate was reduced by 60 basis points to 10.9% –now the third most distressed segment

Industrial uncharacteristically added 80 basis points, the largest increase among property types.  With that said, the overall distress rate is only 1.6%. 

Payment Status

Our team explored how payment status has evolved over the course of 2024.  Some takeaways:

January saw an increase in loans that are marked as current; rising from 13.5% in December to 14.7% as of January 31st. 

Combining current with late but in the grace period and late by last than 30 days delinquent, this ‘wider current’ metric regained its footing, notching 22.7% a 310 basis point favorable swing. 

Combining performing matured with non-performing matured, January saw a modest decrease from 62.2% in December to  61.7% in January.

Analysis Methodology

CRED iQ’s distress rate factors in all CMBS properties that are securitized in conduits and single-borrower large loan deal types.  CRED iQ tracks Freddie Mac, Fannie Mae, Ginnie Mae, and CRE CLO loan metrics in separate analyses.

CRED iQ’s distress rate aggregates the two indicators of distress – delinquency rate and specially serviced rate – yielding the distress rate. The index includes any loan with a payment status of 30+ days delinquent or worse, any loan actively with the special servicer, and includes non-performing and performing loans that have failed to pay off at maturity.

Access CRED iQ Today

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-V13

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

Deal Overview

The BMARK 2025-V13 CMBS deal is a new issuance securitization for the CMBS market, with a total pooled balance of $767.4 million. The deal is jointly managed by prominent financial institutions including Citigroup, Barclays, Deutsche Bank, BMO, and Goldman Sachs. The deal is collateralized by 36 loans and secured by 120 properties across a variety of sectors, including multifamily, retail, and self storage. The strategic geographic distribution of these properties ensures balanced exposure across major markets. The deal’s weighted average loan-to-value (LTV) ratio of 54.7%, and the weighted average mortgage interest rate is 6.54%.

Key Metrics

The loan pool for BMARK 2025-V13 is structured with interest only loans, offering investors a steady income stream. A mix of the interest only loans end with ARD (10.0%) or an Amortizing Balloon payment (1.8%). The pool boasts a weighted average debt service coverage ratio (DSCR) of 1.77. The weighted average net operating income (NOI) debt yield is 12.3%.

Geography & Property Types

A key strength of the BMARK 2025-V13 CMBS deal is its diverse property type distribution, which enhances portfolio resilience. Multifamily properties constitute 27.0% of the total balance, while retail properties account for 22.4% of the balance. The geographic distribution of the properties across prime markets, including high-growth areas in New York City, Houston, and Atlanta.

Access Loan Details

For CRED iQ Subscribers

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 2025-5YR13

By
Michael Haas
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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

Deal Overview

The BANK5 2025-5YR13 CMBS deal is a new issuance securitization for the CMBS market, with a total pooled balance of $737.1 million. 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 31 loans and secured by 59 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 57.4%, and the weighted average mortgage interest rate is 6.69%.

Key Metrics

The loan pool for BANK5 2025-5YR13 is structured to include a mix of amortizing and interest-only loans, with 6.7% of the mortgage pool having scheduled amortization. The remainder of the pool (93.3%) 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 1.81. The weighted average net operating income (NOI) debt yield is 12.9%.

Geography & Property Types

A key strength of the BANK5 2025-5YR13 CMBS deal is its diverse property type distribution, which enhances portfolio resilience. Hotel properties constitute 27.4% of the total balance, while office properties account for 20.4% of the balance. The geographic distribution of the properties across prime markets, including high-growth areas in New York City, San Francisco, and Virginia Beach.

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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.

Maturity Wall Grows with $440 Billion Coming Due Over the Next Two Years

By
Michael Haas
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0

This week, the CRED iQ research team wanted to offer an initial glimpse of our upcoming 2025 Almanac which is set for publication next week.  

In today’s report, we analyzed the securitized commercial mortgages with maturity dates scheduled in 2025 and 2026. Within the securitized universe, approximately $277 billion in commercial mortgages are scheduled to mature in 2025, with an additional $163 billion maturing in 2026.  In total, CRED iQ has aggregated and organized a total of $440 billion of commercial mortgages slated to mature within the next 24 months.

The scope of CRED iQ’s analysis is comprised of loans securitized in CMBS conduit trusts, single-borrower large-loan securitizations (SBLL) and CRE CLOs, as well as multifamily mortgages securitized through government-sponsored entities.

Thanks in part to the $36 billion in loan modifications executed over the course of the past three years, the next 12 months have the highest volume of scheduled maturities for securitized CRE loans over a period of 10 years ending 2034. Let’s dive into the details.

Securitized Universe

(includes CMBS, SBLL, CRE CLO, Freddie Mac, Fannie Mae, and Ginnie Mae)

2025 and 2029 have the largest aggregate balances of maturing loans over the next five years

  • In 2025, $275 billion of CRE debt will mature.
  • In 2029, $211 billion of CRE debt will mature.

The CMBS sector comprises a majority of the maturity throughout 2025 and 2026 logging $174 billion and $92 billion in each year respectively.  The Freddie Mac and CRE CLO sectors round out the top 4.

Property Type Analysis

Office properties represent 24% of all maturing loans across 2025 and 2026 ($64 billion).  Right behind office, is the multifamily segment which comprises 23% of the maturing loans during the period ($61 billion).  

Hotel properties will see $48 billion in loans maturing during the next 24 months.  The industrial and retail segments follow ~$42 billion each.  

CRED iQ Almanac 2025

Stay tuned for details on how you can download the official handbook of CRE Finance.  CRED iQ’s 2025 Almanac: Maturity Outlook and Chartbook is coming next week! 

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.

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