Delinquency Rates on Commercial and Multifamily Properties Increase for Second Consecutive Month in December

According to the latest Mortgage Banker Association’s (MBA) latest monthly MBA CREF Loan Performance Survey, the delinquency rates for mortgages backed by commercial and multifamily properties, which includes lodging and retail properties, increased for the second consecutive month in December. The survey was developed to better understand the ways the pandemic is impacting commercial mortgages loan performance. In a statement prepared to accompany the survey, Jamie Woodwell, MBA’s Vice President of Commercial Real Estate Research, said “The increase in commercial and multifamily mortgage delinquencies in December is a symptom of the economic slowdown stemming from the recent surge in COVID-19 cases. Delinquencies initially jumped in April and May, driven by the impact the pandemic had on lodging and retail properties. For several months, delinquency rates declined as the economy stabilized. But more recently, the added stress from a winter wave of the virus has weakened the economy and challenged some owners, as property income has been disrupted. The roll-out of multiple COVID-19 vaccines is good news for the long-term, but last month’s rise in commercial mortgage delinquencies reinforces that many challenges remain between now and when the economy can fully reopen.”

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Commercial and Multifamily Mortgage Delinquencies Rise in December