Multifamily Distress
Commercial Observer
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The distress rate for commercial mortgage-backed securities loans on multifamily properties climbed throughout the summer, according to recent figures. Also for today: New numbers reveal that (unsurprisingly) housing costs continue to drive much of inflation in the U.S.
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— Tom Acitelli, Deputy Editor
Multifamily Drives CRE Distress Rate to Another Record High
The CRED iQ team evaluated payment statuses reported for each loan securitized by CMBS financing along with special servicing status as part of our monthly distress update. The overall CRED iQ distress rate increased from 8.8 percent to 9.1 percent in August, achieving a sixth straight record high. CRED iQ’s special servicing rate came in flat month-over-month at 8 percent, while the CRED iQ delinquency rate increased by 66 basis points to 6.8 percent in August. The multifamily sector continued its upward rise in distress, jumping to 11 percent from July’s 8.4 percent, a dramatic 260-basis point increase in one month. Just eight months before, the multifamily distress rate stood at 2.6 percent. The multifamily loan segment surpassed retail to secure the second-highest level of distress among all CRE segments.
Housing Costs ‘Main Factor’ Driving Inflation, Even as Rates Cool: Report
Inflation rates in the U.S. may be cooling down overall, but housing costs are still heating up, according to the latest Consumer Price Index (CPI) report released Wednesday morning. The CPI rose 0.2 percent in August — the same as it did in July, the U.S. Bureau of Labor Statistics said. Overall, consumer prices grew 2.5 percent over the last 12 months. That’s down from the 2.9 percent annual inflation rate the CPI reached last month, and it marked the fifth consecutive annual drop and the smallest yearly increase since February 2021, The Associated Press reported. A spokesperson for the Bureau of Labor Statistics did not immediately respond to a request for comment.
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