S&P: CMBS Overdues Up 13bps in 3Q

Delinquencies on commercial mortgage-backed securities rose 13 basis points to 0.29% in the third quarter, led by loans from 2005 and 2006, according to Standard & Poor's.The total amount delinquent rose by 16.2%, after the second quarter's rise of 12.7%, S&P reported. At the end of the third quarter, $1.92 billion of CMBS loans were delinquent, compared with $1.65 billion at the end of the second quarter. Delinquencies on securities backed by loans made in 2005 and 2006 were up by 41% and 46%, respectively. Since the first quarter, 2005 and 2006 delinquencies have increased by 179% and 297%, respectively. In total, the two years accounted for 72% of the quarter's delinquency increase and now represent one-third of total delinquencies, the rating agency reported. S&P said it expects delinquency levels on these vintages to rise faster than those of other vintages, acting as a drag on CMBS performance for some time. By property type, delinquency rates for health care, retail, and office increased, while lodging, multifamily, and industrial delinquency rates declined. Delinquency rates for all property types have been below 1% in 2007 for the first time in this decade, S&P said. The rating agency can be found online at http://www.standardandpoors.com.