KBRA Releases Research – CMBS Loan Performance Trends: April 2025

KBRA releases a report on U.S. commercial mortgage-backed securities (CMBS) loan performance trends observed in the April 2025 servicer reporting period. The delinquency rate among KBRA-rated U.S. private label CMBS in April increased to 7.1% from 6.8% in March. The total delinquent plus current but specially serviced loan rate (collectively, the distress rate) increased 25 basis points (bps) to 10%. Other than the industrial sector, all major property types continue to show an upward trend in their CMBS delinquency rate, ranging from 38 bps (mixed-use) to 66 bps (lodging), while industrial declined to only 0.8%.

In April, CMBS loans totaling $1.9 billion were newly added to the distress rate, of which 52.8% ($1 billion) comprised imminent or actual maturity default. The retail sector experienced the highest volume of newly distressed loans (39.7%, $762.5 million), followed by office (27.2%, $522.8 million), and mixed-use (11.9%, $227.8 million).

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

• The delinquency rate increased to 7.1% ($23.4 billion), from 6.8% ($21.1 billion) in March.
• The distress rate increased to 10% ($32.8 billion), from 9.8% ($32 billion) last month.
• The office distress rate reversed last month’s improvement and broke the 15% mark with a 24-bp increase. Mixed-use, a component of which is often office use, saw the highest increase (89 bps) in the month-over-month (MoM) distress rate across all property types.
• Even though the multifamily sector’s distress rate was flat MoM, the two sub-buckets shifted. The delinquency rate saw a significant increase—63 bps—as 180 Water ($265 million in three conduits) moved from current and specially serviced to a nonperforming matured balloon while the borrower continues to work with the special servicer to finalize a loan forbearance. Apart from this, $202.1 million was added to delinquency, with loans ranging from $110 million (Austin Multifamily Portfolio in two conduits) to $3.6 million (Lofts at Trolly Station in CSAIL 2015-C2).
• The retail sector’s distress rate jumped 58 bps due to Pembroke Lakes Mall ($260 million in GSMS 2013-PEMB), Walden Galleria ($221 million in JPMCC 2012-WLDN), and Waterfront at Port Chester ($133.5 million in MSC 2015-MS1 and MSBAM 2015-C22). Adding to the sector’s distress were another 11 loans, which totaled $147.9 million.

In this report, KBRA provides observations across our $338.7 billion rated universe of U.S. private label CMBS including conduits, single-asset single borrower and large loan transactions.

Click here to view the report.

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About KBRA

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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