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Profimex Market Review Update – October 15, 2020

15.10.2020

CMBS Foreclosures Start Rising as Hotel Defaults Break 50% In Some Cities

Trepp, the bigdata firm, released their September edition for CMBS analysis and found that the outlook for hotels and retail loans continues to worsen. The firm found that 26% of CMBS loans, backed by hotels currently have a special servicing status. Further, 18.3% of retails loans are being special serviced, making both sector’s rates the highest rates ever recorded. The property type that was hit the hardest are luxury hotels in major cities.

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Grocery-Anchored Retail Cap Rates May Actually Fall

While it is difficult to assess the true cap rates of retail asset at large, due to the limited transaction volume, the cap rates for grocery-anchored assets have been minimally impacted. Melina Cordero, a managing director who is the leader of CBRE’s retail capital markets business for the Americas, said that they “may actually see some cap rate compression in the months to come.”

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