According to the Mortgage Bankers Association's latest commercial real estate finance Loan Performance Survey, delinquency rates for U.S. mortgages backed by commercial and multifamily properties increased slightly through the first quarter of 2023.
"Delinquency rates for commercial and multifamily mortgages increased for the second straight quarter," said Jamie Woodwell, MBA's Head of Commercial Real Estate Research. "The rise was led by a 110-basis-point increase in the share of office loan balances that are 30 days or more past due. At the same time, pandemic-fueled delinquency rates for retail and hotel loans continued to tick down."
Woodwell continued, "Higher and volatile interest rates, coupled with uncertainty about property values and some property fundamentals, are suppressing sales transaction and mortgage origination volumes. Some loans maturing into these conditions are likely to face increased frictions, which is likely to push further on delinquency rates in coming quarters."
Loan Performance Survey Key Findings