Monday, July 26, 2010

CRE Indicators: Monthly CMBS Delinquency Report – Realpoint LLC Commentary

In June 2010, the delinquent unpaid balance for CMBS increased by $3.11 billion, up to $60.45 billion from $57.34 billion a month prior. Four of the five delinquency categories increased while the 60-day category reflected a $2.06 million decrease from the prior month, offset by further credit deterioration in all other categories. This included a $3.2 million increase in the 30-day category. Overall, the delinquent unpaid balance is up 111% from one-year ago (when $28.64 billion of delinquent unpaid balance was reported for June 2009 – impacted at such time by the historical GGP loan delinquency), and is now 27 times the low point of $2.21 billion in March 2007. The distressed 90+-day, Foreclosure and REO categories grew in aggregate for the 30th straight month – up by $2.0 billion (5%) from the previous month and $30.71 billion (214%) in the past year (up from only $14.34 billion in June 2009).

The total unpaid balance for CMBS pools available for review for the June 2010 remittance was $784.86 billion, down from $788.7 billion in May 2010. Both the delinquent unpaid balance and delinquency percentage over the trailing twelve months are …clearly trending upward. The resultant delinquency ratio for June 2010 of 7.7% (up from the 7.27% reported one month prior) is over two times the 3.5% reported one-year prior in June 2009 and over 27 times the Realpoint recorded low point of 0.283% from June 2007. The increase in both delinquent unpaid balance and percentage reflects a steady increase from historic lows in mid-2007.

Realpoint LLC