2021 Multifamily Special Servicing Rate

7 min read

Trepp’s latest report on where rates are headed.

Source: Trepp

The Trepp CMBS Special Servicing Rate fell 20 basis points in December to 6.8 percent. The percentage of loans on the servicer watchlist fell for the third consecutive month, 26.5 percent of which were reported as on the servicer watchlist, a drop of 103 basis points from the November reading.

Approximately $830 million in CMBS debt was transferred to special servicing in December. The overall US CMBS 2.0+ special servicing rate is 6.3 percent. One year ago, the US CMBS 2.0+ special servicing rate was 9.0 percent, while six months ago, the rate was 7.6 percent. The overall US CMBS 1.0 special servicing rate is 41.0 percent. One year ago, the US CMBS 1.0 special servicing rate was 50.6 percent, while six months ago it was 46.2 percent.

The multifamily special servicing rate went down six basis points to 2.1 percent.

—Posted on Jan. 26, 2022


Source: Trepp
Source: Trepp

The Trepp CMBS Special Servicing Rate fell 22 basis points in November to 7.0 percent. In November 2020, the rate was as high as 10.2 percent, but the market has continued to adapt to a COVID-impacted economy. The percentage of loans on the servicer watchlist fell for the second consecutive month. Roughly 27.5 percent of loans were reported to be on the servicer watchlist in November, down from 28.2 percent in October. The major property types all saw slight drops in their rate.

Approximately $1.9 billion in CMBS debt was transferred to special servicing in November. This is the highest newly transferred balance in 2021. The multifamily sector came in at 2.2 percent, down 22 basis points.

—Posted on Dec. 21, 2021


Source: Trepp

The Trepp CMBS Special Servicing Rate fell 31 basis points in October, coming in at 7.2 percent. This is the 13th consecutive month that the special servicing rate has declined.

The multifamily sector dropped 14 basis points to 2.4 percent in September. The percentage of loans on the servicer watchlist fell for the first time in nine months. Roughly 28.2 percent of loans were reported to be on the servicer watchlist in October, down 109 basis points from its reading of 29.3 percent in September. Approximately $244.9 million in CMBS debt across 13 notes were transferred to special servicing in October. This is the lowest balance of newly transferred loans in 2021.

One year ago, the US CMBS special servicing rate was 10.5 percent, while six months ago it was 9.4 percent. For the CMBS 2.0+ numbers, the overall rate is 7.0 percent. One year ago it was 9.6 percent and six months ago it was 8.7 percent. For the CMBS 1.0 numbers, the overall rate was 41.7 percent. One year ago it was 48.1 percent, while six months ago was 47.4 percent.

For property types in CMBS 1.0 and 2.0+, the multifamily rate went down 14 basis points to 2.4 percent. For CMBS 2.0 + it was the same amount and there was no change for CMBS 1.0.

—Posted on Nov. 22, 2021


Source: Trepp
Source: Trepp

The Trepp CMBS Special Servicing Rate fell 30 basis points in September, coming in at 7.5 percent. This month’s drop marks one year of consistent declines in the special servicing rate, following the initial rise due to the economic impact of COVID-19. In the past 12 months, the special servicing rate has fallen 300 basis points, from 10.5 percent in September 2020.

The multifamily sector dropped three basis points to 2.5 percent in September. The percentage of loans on the servicer watchlist rose for the ninth consecutive month–increasing 32 basis points to 29.3 percent. Approximately $355.6 million in CMBS debt across 15 notes were transferred to special servicing.

One year ago, the US CMBS special servicing rate was 10.5 percent, while six months ago it was 9.4 percent. For the CMBS 2.0+ numbers, the overall rate is 7.0 percent. One year ago it was 9.6 percent and six months ago it was 8.7 percent. For the CMBS 1.0 numbers, the overall rate was 41.7 percent. One year ago it was 48.1 percent, while six months ago was 47.4 percent.

For property types in CMBS 1.0 and 2.0+, the multifamily rate went down three basis points to 2.5 percent. For CMBS 1.0, multifamily had no change.

—Posted on Oct. 26, 2021


Source: Trepp
Source: Trepp

The Trepp CMBS Special Servicing Rate fell 35 basis points in August coming in at 7.8 percent. This is the 11th consecutive month the rate has declined. According to August remittance data, four of the five major property types saw decreases in their special servicing reading.

The percentage of loans on the servicer watchlist rose for the eighth consecutive month, rising 145 basis points to 29 percent in August.

One year ago, the US CMBS special servicing rate was 10 percent, while six months ago it was 9.6 percent. For the CMBS 2.0+ numbers, the overall rate is 7.3 percent. One year ago it was 9.1 percent and six months ago it was 8.9 percent. For the CMBS 1.0 numbers, the overall rate was 42.1 percent. One year ago it was 46.8 percent, while six months ago was 47.4 percent.

For property types in CMBS 1.0 and 2.0+, the multifamily rate was down 12 basis points at 2.6 percent. There was no change for the 1.0 rate.

—Posted on Sep. 28, 2021


Source: Trepp
Source: Trepp

The Trepp CMBS Special Servicing Rate dropped for the 10th consecutive month in July, coming in at 8.1 percent–a 10 basis points decline from the month prior. While the drop indicates continued signs of recovery, this is the smallest drop since January when the rate fell nine basis points.

The percentage of loans on servicer watchlist rose for the seventh consecutive month–inching up eight basis points to 27.6 percent in July. Multifamily was one of the largest monthly declines up 1.8 percent to 28.2 percent.

One year ago, the U.S. CMBS special servicing rate was 9.5 percent, while six months ago it was 9.7 percent. For the CMBS 2.0+ numbers, the overall rate is 7.5 percent. One year ago it was 8.5 percent and six months ago it was 8.9 percent.  For the CMBS 1.0 numbers, the overall rate was 45.9 percent. One year ago it was 46.8 percent, while six months ago was 49.9 percent.

For property types in CMBS 1.0 and 2.0+, the multifamily rate was down two basis points at 2.7 percent. CMBS 2.0+ was down one basis point to 2.7 percent and CMBS 1.0 was down 695 basis points at 0.0 percent.

—Posted on Aug. 27, 2021


Source: Trepp
Source: Trepp

The Trepp CMBS Special Servicing Rate maintained its strong downward movement in June, helped by the US economy continuing to make progress towards a full reopening. The overall reading dropped by 41 basis points to 8.2 percent last month, making it the ninth consecutive monthly decrease.

The percentage of loans on servicer watchlist climbed to 27.5 percent in June, a rise of 97 basis points from May’s tally. The watchlist rate has now increased for sixth consecutive months as loans removed from special servicing were later added to servicer watchlist for continued surveillance.

Roughly $1.28 billion in CMBS debt across 36 notes were transferred to special servicing in June. The multifamily special servicing rate increased 4 basis points to 2.7 percent, according to Trepp.

—Posted on Jul. 27, 2021


Source: Trepp
Source: Trepp

Helped by an improving economic outlook from easing lockdown restrictions across the U.S., the Trepp CMBS Special Servicing Rate continued to trend lower last month. The overall reading fell 38 basis points to 8.7 percent in May, making it the eighth consecutive decrease in the monthly percentage since September 2020.

The CMBS industry continues to make headway in its recovery from COVID-related distress that had impacted the commercial real estate markets last year, which has led to sizable declines in the special servicing rates for many segments. With the U.S. making progress toward “normalcy,” that should result in the continued improvement in the performance of CMBS loans.

By property type, the multifamily special servicing rate decreased by one basis point to 2.7 percent.

The watchlist rate once again climbed in May, boosted in part by loans that were transferred out of special servicing and added to servicer watchlist for further surveillance. The percentage of loans on servicer watchlist rose for the fifth consecutive month to 25.6 percent, up 97 basis points from April.

May remittance data indicates that about $1.1 billion in CMBS loans were removed from special servicing last month.

—Posted on Jun. 29, 2021

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