The delinquency rate1 among KBRA-rated U.S. private label commercial mortgage-backed securities (CMBS) decreased to 7.7% in September from 7.9% in August. However, the total delinquent plus current but specially serviced loan rate (collectively, the distress rate) remained stable at 10.7%. The office delinquency rate decreased 90 basis points (bps) this month to 12.3%. Most of the office loans that became current this month remain with the special servicer, which is why the office distress rate did not fall. Among KBRA-rated loans, 1211 Avenue of the Americas ($1 billion in AOTA 2015-1211) became a performing matured balloon after a three-year modification and extension was closed last month.
In September, CMBS loans totaling $2.1 billion were newly added to the distress rate, of which 40% ($823.4 million) involved imminent or actual maturity default. The office sector experienced the highest volume of newly distressed loans (42.1%, $896.5…