Fitch: CMBS Overdues Declining

Delinquencies on commercial mortgage-backed securities have declined across the board this year as a result of improved commercial real estate market performance, according to Fitch Ratings.CMBS delinquencies have declined 0.28% to 0.52% at the end of the third quarter. Looking at the decline by property sector, hotel properties head up the list with a 61% decline by dollar amount, followed by multifamily (24%), retail (15%), and office (12%), the rating agency reported based on its U.S. CMBS loan delinquency index. Hotel properties dropped to 9% of all CMBS delinquencies at the end of the third quarter from 16% at year-end 2005. "Hotel performance improved significantly in 2005, and the improvement continued through third-quarter 2006, albeit at a slower pace," said Fitch senior director Patty Bach. The largest concentrations of CMBS delinquencies consist of multifamily (36%), office (23%), and retail (20%). The rating agency's seasoned delinquency index fell 0.44% over the first three quarters of 2006.