Special Servicing Rate Rises Again in May, Driven by Office Surge

The Trepp CMBS Special Servicing Rate rose for the second consecutive month in May, up 13 basis points to 10.30%.

In 2025, year-to-date, the rate has risen 41 basis points and since the beginning of 2024, the rate has risen more than 350 basis points. In May, the balance of loans in special servicing rose by $1.3 billion, while the overall balance of CMBS loans outstanding climbed more than $5.6 billion as well.

When looking into property type specifics, four sectors were minimally changed, with monthly movements of five basis points or less. Only two property types saw substantial changes to their respective rates: lodging and office.

The lodging rate experienced some relief, receding 64 basis points to 9.57%, after spiking to a three-year high the month prior. On the flip side, the office rate surged another 86 basis points in May to 15.76%, pulling the overall rate higher along with it. Just one year ago, the office rate was over 500 basis points lower at 10.52%.   ...more

RSK: Trepp`s report on Commercial Loans in the special servicing category( read most likely delinquent). Bright spot is Hotels which fell some while office loans rose some.