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CMBS Loan Performance Trends: January Update
1/27/2021 · by Kroll Bond Rating Agency · CMBS Performance Metrics · Research and Background Documents
KBRA releases a report on U.S. commercial mortgage-backed securities (CMBS) loan performance trends observed in the January 2021 servicer reporting period. The delinquency rate for the period remained unchanged month-over-month, at 6.5%, among KBRA-rated CMBS. This is the seventh consecutive month that delinquencies either declined or were flat from its 8.2% June peak. However, other loan performance metrics trended slightly negative this month, illustrating the continued economic effects of the COVID-19 pandemic on commercial real estate markets. For example, the lodging delinquency and specially serviced rate increased to 22.9% from 22.4% from the prior month. In addition, the rate for loans classified as less than 30 days delinquent increased 60 basis points MoM in January, to 2.6%. This statistic is a general precursor of loans that will be identified as delinquent in the next payment period, meaning a higher likelihood that we could see an uptick in conduit delinquencies in February. This month, in addition to the usual reporting, KBRA provides some notable data points surrounding loans transferred into special servicing to provide context of how CRE has fared during the pandemic, specifically how few specially serviced loans have been corrected and returned to the master servicer.