Delinquencies for CMBS Improve in July: Trepp

Delinquencies on commercial mortgage-backed securities fell 3 basis points to 5.42% in July, from the previous month, according to Trepp.

The 5.42% rate of delinquencies on the loans backing CMBS is 62 basis points lower than a year ago. The rate has fallen 33 basis points this year. In total for the month, $1.4 billion of loans became newly delinquent.

The delinquency rate returned to a downward direction after an increase in June.

"Although we expect the rate to continue downward, the pace of improvement may be much slower than we have seen over the past few years," Joe McBride, research associate at Trepp, said in a news release.

"Add a potential rate hike to the mix and the delinquency rate may just bump along in the 5% range as more maturities send marginal loans to special servicing and default."

The rate of seriously delinquent loans also declined in July, falling 10 basis points to 5.22%.

Multifamily properties had a delinquency rate of 8.76% in July, the worst rate among all categories. Lodging was the best-performing category, with a rate of 3.7%.