The Trepp CMBS Special Servicing Rate rose 80 basis points in April to reach 8.11%. This marks the largest monthly jump that the rate has experienced in nearly four years, with higher monthly upticks only reached during the COVID-19 pandemic in mid-2020. In addition, this is the first time that the rate has topped the 8.00% mark since July 2021.
The new transfer balance in April was relatively high, with a volume that totaled about $5.46 billion, Trepp reported. Four property types accounted for the lion’s share of the balance, with office, retail, “other” and multifamily loans representing 98% of the monthly total.
In contrast to most months recently where office transfers have dominated and multifamily was only a small portion, multifamily transfers led the way in April. The sector’s $1.62 billion accounted for 30% of the monthly sum.
The $1.2-billion Parkmerced loan, backed by a 3,200-unit multifamily complex in San Francisco (pictured), was the largest to newly transfer in April and was the main contributor to a 269-bp increase in the multifamily special servicing rate. Trepp said the most recent financials had shown the loan struggling in 2023; it transferred to special servicing last month at the request of ownership.
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