Approximately $298 billion worth of commercial real estate loans are scheduled to mature in 2017, up from $263 billion in 2016.
CMBS totals are expected to reach $126 billion in 2017, up significantly as 10-year loans issued in 2006 and 2007 are coming due. CMBS delinquency rates have increased to 5.03 percent.
The increase in debt maturity has raised some concerns of escalating defaults. However, the overall current rate of CRE default is at historically low levels of 0.87 percent as of Q3 2016, down from 1.06 percent a year ago*.
These default levels are not likely to increase dramatically in 2017 as the overall commercial real estate market remains on solid footings with rents rising in most markets.
For more information contact Henry Gjestrum.
Visit the JLL Los Angeles Research webpage for additional market insight.
* Delinquency rates on loans and leases at commercial banks
Source: JLL Research, Trepp (Data available through Q2 2016), and the Federal Reserve 2016