Quarterly U.S. CRE CLO Report: Q4 2021 Caps off Record Issuance Year
This is the first edition of a new quarterly report we will publish, highlighting key metrics and trends for the commercial real estate collateralized loan obligation (CRE CLO) industry in the U.S.-- There were 16 new CRE CLO transactions totaling $14.61 billion in Q4 2021, continuing an active year, which had the highest new issuance volume on record at $50.38 billion. More than two thirds of the year's transactions were managed, with the static deals (no reinvestment period) coming in at just above 30% of the year's deal count.
-- Multifamily collateral continued to dominate in transactions, with 64.3% of all loans backed by apartments, student housing, and single-family rental communities. Loans backed by office properties remain a distant second at 12.5%.
-- Hotel loans are beginning to emerge in CRE CLOs as the post-pandemic travel environment takes shape. One all-hotel transaction was issued by Värde Partners, and hotel loans are steadily increasing in volume. Bridge loans to hotels recovering from 2020 and 2021 may become a regular feature of the CRE CLO market in the coming year.
-- December delinquency rose above 2% for the first time since March 2021 on the back of a spike in mixed-use delinquent loans.
-- The special servicing rate has remained subdued, not surpassing 0.5% since May 2021.
-- As of Q4 2021 reporting, the overall loan modification rate for CRE CLOs was 4.6%, a decline from the 5.5% rate in the prior quarter, driven by improvement in hotels and retail properties.
DBRS Morningstar is a global credit ratings business with 700 employees in eight offices globally. DBRS and Morningstar Credit Ratings are committed to empowering investor success, serving the market through leading-edge technology and raising the bar for the industry.
Together, we are the world’s fourth largest credit ratings agency and a market leader in Canada, the U.S. and Europe in multiple asset classes. We rate more than 2,600 issuers and 54,000 securities worldwide and are driven to bring more clarity, diversity and responsiveness to the ratings process. Our approach and size provide the agility to respond to customers’ needs, while being large enough to provide the necessary expertise and resources. For more details visit us at dbrs.com.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.