New issue metrics continue to decline as the percentage of new issue full and partial interest-only (IO) loans in Fitch-rated transactions rose by five percentage points last quarter. The increase was driven by an approximately four-percentage-point increase in full IO loans. In addition, Fitch-stressed LTVs continued to edge up, while stressed DSCRs were lower.
Meanwhile, metrics of legacy U.S. CMBS improved. Delinquencies in Fitch-rated transactions fell in fourth quarter-2014 (4Q'14), though the rate of declines slowed. This was largely due to a backlog of REO assets, which comprised nearly two-thirds of the index balance. Furthermore, the percentage of loans in special servicing declined again in 4Q'14 to $25.1 billion.
'The wave of upcoming CMBS maturities will begin in 2015, particularly in the second half of the year,' said Managing Director Mary MacNeill. The majority of 2015 loan maturities for Fitch-rated, fixed-rate multiborrower CMBS ($21 billion) are set to come due in 2H'15. Roughly $12 billion comes due in 1H'15 ($3.5 billion in 1Q'15). The majority of the higher-leveraged, peak-vintage loans mature between 2016 and 2017, which totaled $129 billion at YE14, excluding $11 billion that already defaulted and remain outstanding.
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