US CMBS Delinquency Rate Hits 7.55% in May 2026

CMBS Delinquencies Edge Up in May

The US CMBS delinquency rate inched up to 7.55% in May 2026, per Trepp’s latest report. This marks a one basis point increase month-over-month and keeps levels near recent highs. The largest newly delinquent loans totaled $1.86B and spanned major metros and asset classes. The list ranged from Orlando hotels to a Times Square ground lease, affecting nearly every CRE sector.

Refinancing Challenges Drive Delinquency Mix

Persistent headwinds, including high rates and tough refinancing conditions, continue to drive the mix of delinquent loans. According to Trepp, 70% of newly delinquent balances were classified as non-performing matured balloon—loans that failed to pay off at maturity but remain in limbo. Another 28% of new delinquencies were in the 30-day bucket, while the remaining 2% are mostly in foreclosure. This highlights just how much maturity issues, rather than operational distress, are pushing loans into delinquency.

Sector Breakdown: Industrial and Retail Worsen

Delinquency rates diverged among major property types. Industrial saw the sharpest jump, rising 35 basis points to 1.31% as several logistics and manufacturing loans became delinquent. Retail followed closely behind, increasing 30 basis points to 6.61%, weighed down by regional malls and shopping centers. On the upside, multifamily delinquencies dropped 76 basis points to 6.95%, recovering after an April spike. Office improved by 16 basis points to 11.53%, with cures and payoffs outpacing new trouble spots. Lodging edged down to 6.01%, though this was a technical shift as new issuance outweighed new delinquencies.

Market Context: Refinancing Stress Remains Paramount

This modest uptick in the overall rate underscores the stickiness of delinquency risk in the current climate. According to Trepp’s data, non-performing matured balloon loans continue to dominate new delinquencies each month, reflecting ongoing challenges for borrowers unable to refinance or sell assets as major maturities come due. Loan performance remains weakest in urban office properties and regional malls. Those sectors have challenged lenders since interest rates began climbing in 2022.

Why It Matters

For CRE market participants, a stubbornly high delinquency rate means refinancing risk is still front and center, especially as more loans mature through 2026. Asset classes like office and retail remain exposed, but industrial’s uptick signals refinancing problems spreading into sectors that, until now, had shown relative resilience. The multifamily improvement offers a rare bright spot, but the overall trend reinforces the need for borrowers and servicers to closely monitor maturities and cash flows.

What’s Next

With another wave of CMBS maturities hitting in the second half of 2026, expect further pressure on sectors facing lingering vacancy and value uncertainty. Watch for lenders to get more selective in refinancing or extending troubled loans, and for further divergence between sectors with stable cash flow and those reliant on stabilized occupancy. Delinquency rates could rise further if interest rates stay high or transactional liquidity thins, putting even more focus on workouts, restructurings, and special servicing activity for legacy loans.