Last month, 60.7% of commercial real estate loans reaching their balloon date paid off, according to new data from Trepp LLC. Last month's level was down over seven points from the September reading.
Trepp reports that the October reading of 60.7% was more than 16 points above the 12-month average of 44.3%. By loan count (as opposed to balance), 59.7% of loans paid off.
Furthermore, Trepp notes that monthly payoff percentages prior to 2008 were ‘typically well north of 70%.’ Since the beginning of 2009, however, there have only been six months in which more than half of the balance of loans reaching their balloon date actually paid off.
‘With new issue commercial mortgage-backed securities spreads at their tightest levels in four years, and with the Treasury curve near historic lows, more loans should be refinanceable now than at any time since 2008,’ Trepp adds.