Delinquency Rates for Commercial Properties Increased in First Quarter: MBA

Delinquency rates for mortgages backed by commercial properties increased during the first quarter of 2025. This is according to the Mortgage Bankers Association’s latest commercial real estate finance Loan Performance Survey.

“The delinquency rate for commercial mortgages increased again in the first quarter of 2025, driven by higher delinquencies on lodging and industrial properties and rising delinquencies on GSE and FHA loans,” said Judie Ricks, MBA’s Associate Vice President of Commercial Real Estate Research. “MBA is closely watching delinquency trends, as there have been increases in both later-stage and new delinquencies. Economic growth will slow in 2025, which could lead to further increases in mortgage delinquencies through the second half of the year.”

• The balance of commercial mortgages that are not current increased slightly in the first quarter of 2025.
• The share of loans that were delinquent increased for some property types, particularly office and lodging, decreased for industrial and retail properties, and remained roughly constant for multifamily properties overall.
• Among capital sources, CMBS loan delinquency rates saw the highest levels.
• 5.2% of CMBS loan balances were 30 days or more delinquent, down from 5.3% at the end of last quarter.
• Non-current rates for other capital sources remained moderate.
• 1.0% of life company loan balances were delinquent, up from 0.9%.
• 0.6% of GSE loan balances were delinquent, up from 0.55% the previous quarter.
• 1.1% of FHA multifamily and health care loan balances were delinquent, up from 1.0% the prior quarter.

MBA’s CREF Loan Performance survey collected information on commercial and multifamily mortgage portfolios as of December 30, 2024. This quarters’ results build on similar surveys conducted since April 2020. Participants reported on $2.6 trillion of loans in March 2025, representing 54% of the total $4.8 trillion in commercial and multifamily mortgage debt outstanding (MDO) relative to the fourth quarter of 2024 MDO report.

Click here for more information on MBA’s CREF Loan Performance Survey.