Special Servicing Rate Dips as Office, Mixed-Use Cure

Special servicing rates slipped in February 2026 as office and mixed-use transfers outpaced retail jumps. Explore key CMBS 2.0+ trends.

March 11, 2026

Nina Dale

US CMBS special servicing rate fell 18 basis points to 10.73% in February 2026.
Seven office and three mixed-use loans cured, driving the decline despite a large retail transfer.
The retail special servicing rate spiked 133 bps, led by the $1.25B Saks Fifth Avenue Building loan.
Office and mixed-use rates saw the largest improvements among major property types.

Key Takeaways

Office, Mixed-Use Lead Decline

Trepp reports that US CMBS special servicing rates dipped in February 2026, down 18 basis points to 10.73%. The primary driver was the exit of seven office and three mixed-use loans from special servicing. This progress nearly offset a major retail loan transfer, spotlighting shifting risks across CRE sectors.

The office special servicing rate improved by 82 basis points to 16.29%, while mixed-use declined 118 basis points to 12.49%. Industrial remained stable at 0.85%.

Line chart showing the US CMBS special servicing rate over the last 12 months, rising from 10.32% in Feb 2025 to a peak of 10.91% in Jan 2026 before dipping slightly to 10.73% in Feb 2026.

Retail Surges on Large Transfer

Retail posted the sharpest increase—up 133 basis points to 13.09%—driven by the high-profile $1.25B Saks Fifth Avenue Building loan moving into special servicing. It accounted for $1.5B, or 56.3%, of all new February transfers. The Saks loan transferred after related bankruptcy filings and a $1.75B DIP facility was secured to provide short-term liquidity, underscoring how retail distress can quickly push servicing rates higher during periods of market stress.

Lodging and Multifamily Trends

Rates for lodging and multifamily both edged up in February. Lodging increased 64 basis points to 10.01% as the $265M Starwood Hotel Portfolio loan transferred to special servicing for imminent default. Multifamily nudged up to 8.30%.

Table showing CMBS 2.0+ special servicing rates by property type for Feb 2026, including office (16.22%), mixed-use (12.49%), retail (12.81%), lodging (10.01%), multifamily (8.30%), and industrial (0.85%), along with one-, three-, six-, and twelve-month comparisons.

Cures from Special Servicing

Notable cures in February included the $660M NGP V GSA Portfolio loan, now back with the master servicer after a modification and extension, and a $352.1M portion of the 650 Madison Avenue mixed-use loan. Borrowers brought loans current with reinstatement payments and reserve funding.

CMBS 2.0+ and 1.0 Performance

CMBS 2.0+ special servicing now stands at 10.65%, relatively stable over the past year. Office and mixed-use within CMBS 2.0+ remain elevated but saw improvement in February. In contrast, legacy CMBS 1.0 special servicing rates remain high at 60.85%, with retail at over 92%.

What’s Next

Special servicing rates are likely to remain volatile as property-type-level distress shifts between office, retail, and lodging. Close watch will be required on large retail and office exposures as market fundamentals continue to evolve in 2026.