{"id":4346,"date":"2025-01-09T19:42:15","date_gmt":"2025-01-09T19:42:15","guid":{"rendered":"https:\/\/cred-iq.com\/blog\/?p=4346"},"modified":"2025-01-09T19:42:17","modified_gmt":"2025-01-09T19:42:17","slug":"office-distress-rate-eclipses-17","status":"publish","type":"post","link":"https:\/\/cred-iq.com\/blog\/2025\/01\/09\/office-distress-rate-eclipses-17\/","title":{"rendered":"Office Distress Rate Eclipses 17%"},"content":{"rendered":"\n

CRED iQ\u2019s Overall Distress Rate Reaches a Fourth Straight Record High <\/strong><\/p>\n\n\n\n

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. In this special year-end report, we add several new dimensions to get a sense of how distress rates evolved. <\/p>\n\n\n\n

The CRED iQ overall distress rate added 60 basis points, logging its fourth straight record high of 10.6%.   The CRED iQ delinquency rate increased to 8.6% from 7.7% in the November print.  Similarly, the CRED iQ special serving rate added 70 basis points to 9.8%<\/p>\n\n\n

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Segment Review<\/strong><\/p>\n\n\n\n

The office segment saw its largest overall distress rate increase of the year in December\u2014rising from 15.5% in our November print to 17.2% in December.   Office maintains a healthy lead as the property type with the most distress, and the largest distress gain in December across all property types. <\/p>\n\n\n\n

Taking over the number two spot from retail, multifamily notched a distress rate of 12.5%, an increase of 130 basis points since November.  As a reminder, the multifamily segment started the year with a distress rate of just 2.6%<\/p>\n\n\n\n

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

Hotels added 130 basis points to log a distress rate of 9.9% in December\u2014landing in the number four slot. <\/p>\n\n\n\n

Industrial and self-storage saw modest reductions in their tiny distress rates of 0.8% and 1.6% respectively. <\/p>\n\n\n

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Payment Status<\/strong><\/p>\n\n\n\n

Our team explored how payment status has evolved over the course of 2024.  Some takeaways:<\/p>\n\n\n\n