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KBRA Releases Research – CMBS Loan Performance Trends: October 2025

31 Oct 2025   |   New York

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KBRA releases a report on U.S. commercial mortgage-backed securities (CMBS) loan performance trends observed in the October 2025 servicer reporting period. The delinquency rate among KBRA-rated U.S. private label commercial mortgage-backed securities (CMBS) increased to 7.9% in October from 7.7% in September. The distress rate—the total delinquent plus current but specially serviced loan rate—also climbed slightly to 10.9% from 10.7% last month. The multifamily distress rate—the third highest among major property types—jumped 60 basis points (bps) to 10.5%, while the conduit multifamily delinquency rate increased 97 bps month-over-month (MoM) to 7.2%, largely due to the Park West Village loan ($254 million in six KBRA-rated conduits including $66.5 million in rake certificates in BBCMS 2022-C17) falling delinquent in October. The office delinquency rate dipped 7 bps, while its distress rate rose slightly (+6 bps).

In October, CMBS loans totaling $1.7 billion were newly added to the distress rate, of which 43.2% ($733.7 million) involved imminent or actual maturity default. The multifamily sector experienced the highest volume of newly distressed loans (39.4%, $669 million), followed by office (27.3%, $463.2 million) and retail (15.4%, $262 million).

Key observations of the October 2025 performance data are as follows:

  • The delinquency rate increased to 7.9% ($25.6 billion) from 7.7% ($25.2 billion) in September.
  • The distress rate increased to 10.9% ($35.3 billion) from 10.7% last month.
  • The office delinquency rate decreased 7 bps this month to 12.2%. Two previously delinquent loans became current, including Southfield Town Center ($65.7 million in COMM 2014-UBS3 and $50.1 million in COMM 2014-CR18 (not KBRA-rated)), which was previously nonperforming matured balloon, and HP Plaza at Springwoods Village ($95.7 million in HAMLET 2020-CRE1), which was more than 30 days delinquent last month. This was mostly offset by Federal Center Plaza ($130 million in COMM 2013-CR6), which became nonperforming matured balloon in October.
  • The lodging delinquency rate increased 31 bps this month to 3.63%, primarily driven by Holiday Inn FiDi ($52 million in two KBRA-rated conduits and $35 million in WFCM 2018-C47), which is 30 days delinquent despite servicer commentary indicating that the loan was assumed in July 2025 and is expected to be returned to the master servicer.
  • The retail distress rate fell by 18 bps as a decline in current and specially serviced loans outpaced the increase in delinquent loans. Beverly Connection ($175 million in three KBRA-rated conduits) and Oglethorpe Mall ($51.4 million in COMM 2013-CR12 and $77.2 million in COMM 2013-CR11 (not KBRA-rated)) both returned to the master servicer this month while maintaining their current status. Both loans were recently modified and extended.

In this report, KBRA provides observations across our $334.2 billion rated universe of U.S. private label CMBS including conduits, single-asset single borrower (SASB), and large loan (LL) transactions.

Click here to view the report.

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KBRA, one of the major credit rating agencies, is registered in the U.S., EU, and the UK. KBRA is recognized as a Qualified Rating Agency in Taiwan, and is also a Designated Rating Organization for structured finance ratings in Canada. As a full-service credit rating agency, investors can use KBRA ratings for regulatory capital purposes in multiple jurisdictions.

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