Office loans in CMBS have the highest default rates for the second year running, according to Fitch Ratings.
Overall, U.S. CMBS defaults rose last quarter to 13.6%, an 18 basis point (bp) rise from year-end 2012.
Loans backed by office properties represent 55% of defaults by balance, according to Fitch. Defaulted office loans ranged in size from $1.4 million to $130.4 million.
“Office will continue to lead CMBS defaults in the near term as leases signed at the height of the market are rolling into lower rent environments and tenants reduce space,” said Mary MacNeill, managing director at Fitch.