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Turbulent Times Ahead for Commercial Paper

Fitch Sees Cumulative CMBS Defaults Hitting 11% This Year

Loopnet reports from – CRE News:

The cumulative default rate for CMBS conduit loans is projected by Fitch Ratings to climb to 11% by the end of the year from 6.59% at the end of last year.

Through the end of last year, $35.5B of loans in Fitch’s universe of $539B of fixed-rate CMBS loans had defaulted. Last year alone, $17.7B of loans were added to the rolls of defaulted mortgages, with $6B of that being added in the fourth quarter.

In contrast, $17.7B of loans had defaulted between the market’s inception in the early 1990s through 2008.

Fitch said that it expected another 4.4% of the universe it tracks to default by the end of this year, bringing cumulative defaults up to its projected 11% level.

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