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CMBS Delinquency Rates Lowest Since September 2016


With offices in California and New York, integrated real estate investment management firm PCCP specializes in middle-market investment opportunities nationwide. Apart from its everyday business activities, PCCP supports the reporting performed by Institutional Real Estate, Inc. (IREI).

IREI reported that the delinquency rate for commercial mortgage-backed securities (CMBS) hit a 15-month low in December 2017, posting a rate of 4.89 percent that capped six consecutive months of declining rates. As a point of reference, the last time CMBS delinquencies were this low was in September 2016.

The delinquency rate began increasing in February 2016 when many notes from the subprime lending boom of the mid-2000s began to come due and were subsequently not paid. Many of those delinquencies have been addressed since June 2017, however. Thus, while new delinquencies of more than $800 million in home loans were reported in December 2017, the U.S. is actually seeing fewer loans defaulting, and those that default are often swiftly resolved as the housing market continues to stabilize.

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