CMBS special servicing rate hits 11.74%, highest since 2012

Trepp's CMBS special servicing rate rose 25 basis points to 11.74% in October, the highest since December 2012, as $3.01 billion of loans transferred during the month, the research firm reported.

Lodging accounted for 37% of the $3.01 billion in loans that transferred and supplied the largest single loan, the $745.7 million Project Prime, secured by 84 lodging properties. The $302.2 million Hyatt Regency Waikiki Beach Resort & Spa in Honolulu was among the other transfers.

A lender quoting a hotel refinancing this quarter is underwriting against a 10.17% special servicing rate, up 122 basis points in the month. Multifamily's rate rose 69 basis points to 9.22%, and the two were the largest increases among the six property types Trepp tracks. Multifamily closed October within a point of 10%.

The largest multifamily transfer was the $517.7 million Blackjack Portfolio, which reached its fully extended maturity on Oct. 9, 2026. The $285 million Gateways mixed-use loan in Newark, N.J., also transferred. Among notable loans beyond the two largest, about 45% of the balance transferred because of imminent balloon or maturity defaults, Trepp said.

As Private Wealth Daily previously reported, the loan behind BX 2021-21M entered special servicing in October, with the trust down to six properties and 1,842 units and three months to sell, per Multifamily Dive.

Office remains the highest of the six property types at 16.60%, more than 13 times industrial's 1.27%, even after a 25-basis-point decline. Retail fell 13 basis points to 13.71%, mixed-use rose 44 basis points to 13.61%, and industrial added four, to 1.27%.