KBRA releases a report on U.S. commercial mortgage-backed securities (CMBS) loan performance trends observed in the June 2025 servicer reporting period. The delinquency rate among KBRA-rated U.S. private label commercial mortgage-backed securities (CMBS) in June decreased to 7.3% from 7.4% in May. The total delinquent plus current but specially serviced loan rate (collectively, the distress rate) also decreased 31 basis points (bps) to 10.6%. After last month’s 204-bp increase in the distress rate, mixed-use saw a 419-bps decrease following the modification of the JPMCC 2022-NLP Portfolio loan.

In June, CMBS loans totaling $1.6 billion were newly added to the distress rate, of which 47.5% ($771 million) comprised imminent or actual maturity default. The office sector experienced the highest volume of newly distressed loans (47.6%, $772.5 million), followed by retail (19.9%, $322.4 million), and lodging (9.8%, $158.6 million).

Key observations of the June 2025 performance data are as follows:

• The delinquency rate decreased to 7.3% ($23.9 billion) from 7.4% ($24.5 billion) in May.
• The distress rate decreased to 10.6% ($34.6 billion) from 10.9% ($35.8 billion) last month.
• The office delinquency rate increased 51 bps this month to 12.1%. The sector continues its upward trend, albeit at a slower rate than last month. Among KBRA-rated loans, Federal Center Plaza ($130 million in COMM 2013-CR6) and 25 Broadway ($116.6 million in COMM 2014-CR16) became nonperforming matured balloon this month, as the loans became delinquent in June. Additionally, the $300 million One California Plaza loan ($250 million in CSMC 2017-CALI and $50 million in CSAIL 2017-CX10, both KBRA-rated) entered the foreclosure process as negotiations fell through after short-term forbearances.
• Mixed-use’s distress rate fell 419 bps after a 292-bp jump last month. JPMCC 2022-NLP Portfolio, with $1 billion in JPMCC 2022-NLP, was modified and extended 24 months. Prime Storage Fund II, with $340 million in CGCMT 2021-PRM2, was returned to the master servicer after a successful maturity extension to November 2025.
• Multifamily saw a decrease in the specially serviced rate after the Hatteras Multifamily Portfolio ($346 million in NCMF 2022-MFP) paid off without a loss after a 90-day forbearance. The multifamily delinquency rate climbed 59 bps, as four loans ranging from $45 million to $21 million became 30+ days delinquent on top of another 11 loans under $20 million with an average of $10.4 million that also missed payments.

In this report, KBRA provides observations across our $338 billion rated universe of U.S. private label CMBS including conduits, single-asset single borrower and large loan transactions.

Click here to view the report.

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About KBRA

KBRA, one of the major credit rating agencies, is registered in the U.S., EU, and the UK. KBRA is recognized as a Qualified Rating Agency in Taiwan, and is also a Designated Rating Organization for structured finance ratings in Canada. As a full-service credit rating agency, investors can use KBRA ratings for regulatory capital purposes in multiple jurisdictions.

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