{"id":1167,"date":"2021-10-04T13:10:59","date_gmt":"2021-10-04T13:10:59","guid":{"rendered":"https:\/\/www.cred-iq.com\/blog\/?p=1167"},"modified":"2021-10-04T13:10:59","modified_gmt":"2021-10-04T13:10:59","slug":"october-2021-delinquency-report","status":"publish","type":"post","link":"https:\/\/cred-iq.com\/blog\/2021\/10\/04\/october-2021-delinquency-report\/","title":{"rendered":"October 2021 Delinquency Report"},"content":{"rendered":"\n

The overall delinquency rate <\/strong>declined for the 15th consecutive month since its peak in June 2020, continuing a trend of recovery from the spike in distressed assets caused by the pandemic. The delinquency rate, equal to the percentage of all delinquent specially serviced loans and delinquent non-specially serviced loans, for CRED iQ\u2019s sample universe of $500+ billion in CMBS conduit and single-asset single-borrower (SASB) loans was 5.30%. CRED iQ\u2019s special servicing rate, equal to the percentage of CMBS loans that have transferred to special servicing, was equal to 7.57%. Aggregating these two indicators of distress \u2013 delinquency rate and special servicing rate \u2013 into an overall distressed rate (DQ + SS%) equals 7.81% of CMBS loans that are specially serviced, delinquent, or a combination of both.<\/p>\n\n\n\n

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DQ = All delinquent loans in the conduit, SASB and CRE CLO universe, including specially serviced and non-specially serviced loans
SS = All specially serviced loans in the conduit, SASB and CRE CLO universe, including current, delinquent and REO
DQ + SS = All distressed loans in the conduit, SASB and CRE CLO universe that are delinquent, specially serviced, or a combination of both<\/figcaption><\/figure>\n\n\n\n

<\/p>\n\n\n\n

By property type, lodging and retail had the highest individual delinquency rates. Delinquency for each property type declined compared to the prior month and each has exhibited an overall downward trend over the trailing twelve months. The lodging delinquency rate has made the most dramatic recovery over the past year, declining from just under 20% in October 2020 to approximately 11% in September 2021.<\/p>\n\n\n\n

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DQ = All delinquent loans in the conduit, SASB and CRE CLO universe, including specially serviced and non-specially serviced loans
SS = All specially serviced loans in the conduit, SASB and CRE CLO universe, including current, delinquent and REO
DQ + SS = All distressed loans in the conduit, SASB and CRE CLO universe that are delinquent, specially serviced, or a combination of both <\/figcaption><\/figure>\n\n\n\n

Despite a clear signal of improvement in the lodging sector, this property type showed the most volatility when evaluating performance across markets. Lodging accounted for 75% of the biggest month-over-month changes when broken out by market, as exhibited in the table above.<\/p>\n\n\n\n

CRED iQ<\/a><\/strong> monitors market performance for nearly 400 MSAs across the United States covering over $900 billion<\/strong> in outstanding CRE debt. Minneapolis, Louisville, New Orleans, Cleveland, and Milwaukee continue to be the MSAs with the highest rate of distressed properties, which is consistent with the prior month. This month, Sacramento overtook Allentown as the MSA with the lowest distressed rate among the Top 50. The majority of MSAs saw improvements with overall declines in the percentage of distressed properties. Only 8 of the Top 50 MSAs exhibited additional distress compared to the prior month. The Salt Lake City market had the greatest improvement with nearly a 30% decrease in the percentage of distressed properties. The improvement was largely driven by South Towne Center<\/a>, a 1.1 million-sf regional mall that returned from special servicing to the master servicer after a loan modification.<\/p>\n\n\n\n

For the full CRED DQ report, download here:<\/p>\n\n\n\n