July 29, 2016 - 9:06 AM EDT
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Fitch: 1H'16 U.S. CMBS Loan Defaults Fall Slightly; Maturity Defaults Spike

Steady new issuance and overall low default rates helped bring U.S. CMBS cumulative loan defaults down slightly during the first six months of this year, according to Fitch Ratings in its latest weekly U.S. CMBS newsletter.

106 loans totaling $1.44 billion newly defaulted during first-half 2016 (1H'16). This figure is in-line with the 1H'15 when 109 loans totaling $1.45 billion defaulted, and slightly lower than the second half of 2015 when 106 loans totaling $1.7 billion defaulted. Office properties were the largest contributor to new 1H'16 defaults by loan balance, with 29 loans comprising 40% of 1H defaults (four of them over $20 million).

Fitch also reports 32 loans from the 2010-2016 vintages (CMBS 2.0) as defaulting in 1H'16 with a total balance of $302.1 million. This represents a significant increase from 1H'15 when eight CMBS 2.0 loans with an original balance of $69 million defaulted. Driving the increase was loans with oil and gas exposure, including properties in Houston and on the Bakken and Eagle Ford shale formations where local employment is highly dependent on oil and gas exploration.

The five largest defaults in 1H 2016 were:

--$150 million James Center, Richmond, VA;

--$116.6 million Fair Lakes Office Park, Fairfax, VA;

--$68 million Minneapolis Airport Marriott, Bloomington, MN;

--$55.9 million DHL Center, Breinigsville, PA;

--$46.2 million Northwood Centre, Tallahassee, FL.

Additional information is available in Fitch's weekly e-newsletter, 'U.S. CMBS Market Trends', which also contains recent rating actions and an overview of newly released CMBS research, including Fitch presales and Focus reports. The link below enables market participants to sign up to receive future issues of the E-newsletter:

'http://pages.fitchemail.fitchratings.com/CMBSMktOptin/'

Additional information is available at www.fitchratings.com.

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Fitch Ratings
R. Brook Sutherland
Senior Director
+1-312-606-2346
Fitch Ratings, Inc., 70 West Madison Street, Chicago, IL 60602
or
David Ro
Director
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or
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Email: [email protected]


Source: Business Wire (July 29, 2016 - 9:06 AM EDT)

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