Delinquency rates continued to increase in the third quarter for most commercial/multifamily mortgage investor groups, according to the Mortgage Bankers Association's (MBA) Commercial/Multifamily Delinquency Report. Between the second and third quarters, the 30+ day delinquency rate on loans held in commercial mortgage-backed securities (CMBS) rose 0.17 percentage points to 4.06%.
‘Commercial and multifamily mortgages continued to feel stress in the face of the weakened economy,’ says Jamie Woodwell, MBA's vice president of commercial real estate research. "The deterioration in commercial and multifamily loan performance is generally in line with what is being seen in other parts of the economy, with loans backed by commercial properties continuing to perform far better than construction and development loans."
Construction and development loans are not included in the MBA report, but are included in many regulatory definitions of "commercial real estate" despite the fact that they are often backed by single-family residential development projects rather than by office buildings, apartment buildings, shopping centers or other income-producing properties.
Between the second and third quarters, the 60+ day delinquency rate on loans held in life company portfolios rose 0.08 percentage points to 0.23%. The 60+ day delinquency rate on multifamily loans held or insured by Fannie Mae rose 0.11 percentage points to 0.62%. The 90+ day delinquency rate on multifamily loans held or insured by Freddie Mac remained unchanged at 0.11%. The 90+day delinquency rate on loans held by Federal Deposit Insurance Corp.-insured banks and thrifts rose 0.51 percentage points to 3.43%.
SOURCE: Mortgage Bankers Associations