US CMBS Deliquencies Up 18% In March; Only Health-Care Ppties ExemptDOW JONES NEWSWIRES
Standard & Poor's Ratings Services said the delinquency rate on U.S. commercial mortgage-backed securities, or CMBS, surged 28% just in March as the figure quickly approaches the peak following the last recession.
Commercial delinquencies, which long lagged the problems in the residential market, have been spiking since mid-2008 as the recession deepened, vacancies increased and new owners have been unable to refinance mortgages.
The rate climbed to 1.85% from 1.57% in February, putting the figure near the December 2003 peak of 1.96%. All property types, except health care, saw higher delinquency rates and delinquent amounts.
The office sector's delinquencies rate surged 48% just last month, while the amount of retail loans behind - $3.46 billion - overtook multifamily ones as the biggest source of delinquencies. A total of 98 retail loans became delinquent in March, with some related out-of-business chains like Circuit City and Linens 'n Things.
S&P said it continued to downgrade CMBS last month, cutting 130 ratings, while upgrading two. During the first quarter, 96% of 402 ratings actions were downgrades.
-By Kathy Shwiff, Dow Jones Newswires; 201-938-5975; Kathy.Shwiff@dowjones.com
I count 7.
- Deliquencies is not a word
- PPTIEs is not a word
- the delinquencies are either up 18% or 28% - which one?
- Delinquencies are not approaching the peak of the last recession. The 2001 recession had relatively low delinquencies (half today's levels), and the early 1990s had much higher delinquencies than 1.87%.
- Oh. She thinks there was a recession in 2003.
- A "surge" of 28 bps is not a surge (even the ironically named Glacial Surge represents an increase in velocity of a glacier up to 100 times it's normal speed)
- There were over 1500 CMBS rating actions in the first quarter.