Posted on July 24, 2017
Credit rating giant Morningstar reports the delinquency rate for commercial mortgage-backed securities dropped to 3.09 percent in May. That reverses a five-month-long trend. CMBS delinquencies were down five basis points from April, but remain 18 basis points higher than in May of 2016.
“We believe the delinquency rate is close to peaking as there’s not much left that we expect to default at maturity, resolutions remain high, and issuance is starting to pick up,” Morningstar writes. “The delinquent unpaid balance of commercial mortgage-backed securities amounted to $23.84 billion, down a modest $38.4 million from the prior month and up $1.35 billion from the year-earlier period.”
Morningstar finds office and retail remain the weakest sectors.