The CMBS delinquency rate for multifamily product tracked by Moody's jumped 121 basis points in January, marking the biggest increase seen in that property class since the Peter Cooper Village and Stuyvesant Town loan was added to its calculations in March 2010.
The rating agency said three multifamily loan portfolios totaling $915 million constituted the majority of the newly delinquent balance, which caused apartment delinquencies to rise to 15.59% from 14.38% the prior month.
According to Moody's, the overall commercial MBS delinquency rate rose to 9.01% in January from 8.79% in December, another new high.
"If you take out Stuy town, then it goes down to about 12.54%," a Moody's spokesman said of the multifamily delinquency rate.
When asked about the CMBS delinquency rate outlook going forward, the spokesman said, "We've said that the range will be between 9.5% and 11%."
However, as Moody's and other analysts have noted, while CMBS delinquencies have continued to climb, the rate of increase is slowing or at least stabilizing. (Moody's believes the delinquency rate will probably peak this year.)
Given that recent increases in CMBS delinquencies have been somewhat mild compared to the previous two years and multifamily tends to be a volatile property type, David Tobin, a principal at Mission Capital Advisors, told this publication that he is relatively optimistic about the market.
When asked whether he believes the days of large jumps in delinquencies are over, Tobin said if the employment situation were to deteriorate it could be a concern for property types like retail, industrial and office. "But I think the smart money doesn't expect employment to get any worse," he said.
