Rating Agencies See CMBS Delinquencies Rise in May

"In two reports on the state of the commercial mortgage backed securitization markets (CMBS), two rating agencies monitoring bond performance say the market is showing weakness — a trend that will likely continue for the rest of the year.
Fitch Ratings saw office defaults push the overall CMBS delinquency rate to 7.97% in May, as Moody's Investors Service saw a 48-bps hike in CMBS delinquency to 7.5% in May:

"As expected, office loan delinquencies have begun to increase and will continue to rise well into next year," said Fitch managing director Mary MacNeill. "Landlords are facing tenant downsizing and in many cases must offer significant concessions and reduced rent to maintain their existing tenant bases."
Moody's now says it expects the delinquency rate to end 2010 in the 9%-11% range, an increase from the previous expectation of 8%-9%.
Indications of the fragile nature of the recovery in the US, with stubbornly high unemployment, along with ongoing difficult conditions for some CMBS sectors and the possibility of negative effects on the US economy from the sovereign debt problems in Europe, have led to Moody's slightly more negative view..."

at http://www.housingwire.com/2010/06/11/rating-agencies-see-cmbs-delinquencies-rise-in-may?utm_source=rss&utm_medium=rss&utm_campaign=rating-agencies-see-cmbs-delinquencies-rise-in-may