ISTANBUL

Delinquency rates for commercial property loans in the US declined slightly in the second quarter of this year, Mortgage Bankers Association (MBA) said Thursday in a report.

"Commercial properties are working through changes in interest rates, property values, and the fundamentals of some properties," said Jamie Woodwell, MBA's head of Commercial Real Estate Research.

"Each property and loan faces a unique mix of conditions depending on that property’s type and subtype, market and submarket, owner, vintage, deal terms and more. As more loans mature throughout the year, more properties will be adjusting to these new conditions," he added.

While the delinquency rates for mortgages backed by commercial properties declined in the April-June period, loans backed by office properties saw an increase.

The report showed that 97% of outstanding loan balances were current, or less than 30 days late, by the end of the second quarter, up from 96.8% in the first quarter.

While 0.2% were 60-90 days delinquent, down from 0.3% in the previous quarter, 1.1% of multifamily balances were delinquent, down from 1.2%, according to the report.

A loan becomes delinquent when a borrower makes payments late, or miss a regular installment payment.