Fitch: U.S. CMBS Delinquencies 'Stable'

Submitted by Ronald Tennant with Metrocities Mortgage:

MBA (5/20/2008 ) MBA Staff
U.S. commercial mortgage-backed securities delinquencies stabilized in April, rising by just two basis points to 0.35 percent, according to the most recent Loan Delinquency Index from the Chicago office of Fitch Ratings.

Fitch Managing Director Susan Merrick said the increase in the index came from one large newly delinquent $127 million multifamily condominium loan, which she said is expected to be brought current.
“The index would have remained flat at 0.33 percent if not for this loan,” Merrick said. “CMBS delinquencies remain low with only 360 delinquent loans out of approximately 42,000 loans in Fitch rated transactions.”

Given existing macroeconomic conditions, Merrick said Fitch remains concerned about the hotel and retail sectors. However, in the past month, delinquencies in these sectors decreased marginally, she said. At the end of April, hotel delinquencies declined by $20.5 million and retail by $13.3 million.

Three sectors ended April with higher delinquencies, including multifamily and manufactured housing, which increased by $160 million and $8.4 million, respectively. The number and balance of non-performing matured loans declined marginally during April 2008 to 26 loans, or $181.7 million, compared to 44 loans, or $213.2 million in March.

The seasoned delinquency index, which omits transactions with less than one year of seasoning, also rose by two basis points in April, ending the month at 0.41 percent. Five transactions totaling $8.6 billion became newly seasoned, Merrick said, and none of them had delinquent loans.

The Index tracks 60+ delinquencies in 474 Fitch-rated transactions totaling $556 billion.