MBA’s analysis incorporates the measures used by each individual investor group to track the performance of their loans. Together, these groups hold more than 80% of commercial and multifamily mortgage debt. The quarterly analysis looks at delinquency rates for five of the largest investor groups: FDIC-insured banks and thrifts, commercial mortgage-backed securities, life insurance companies, and Fannie Mae and Freddie Mac. “Delinquency rates increased for every major capital source during the first quarter, foreshadowing additional strains that are likely to work their way through the system,” Woodwell said. Together with tightening credit, as a result of bank failures this spring, commercial and multifamily companies are facing headwinds. Over the past 14 months the Federal Reserve has hiked rates 10 times, pushing the cost of borrowing ever higher. “Ongoing stress caused by higher interest rates, uncertainty around property values, and questions about fundamentals in some property markets are beginning to show up in commercial mortgage delinquency rates,” said Jamie Woodwell, MBA’s head of commercial real estate research.Ĭommercial real estate was hit hard by the pandemic, with fewer people returning to offices and spending money - eating lunch, getting their nails done, using dry cleaners - in those corridors. Commercial and multifamily mortgage delinquencies increased in the first quarter of 2023, according to a new report from the Mortgage Bankers Association.
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