The latest Fitch US CMBS loan delinquency index is 0.88% and the index is expected to reach 2% by year's end. Fitch says the December increase was due largely to two loans with outstanding principal balances greater than $100 million, following a November reading which featured two defaults in excess of $70 million. Both loans of $100 million-plus were securitized in early 2008.

The loan delinquency index currently includes 20 loans with a balance of $25 million or more, and six of those loans became newly delinquent in December, according to Fitch. Excluding small balance loans, the average loan size of delinquencies within the Fitch-rated universe now stands at $8.2 million. A year earlier, the average was $6.4 million.

"What began as weakness in the performance of smaller properties located in tertiary markets now includes larger collateral in secondary and primary markets," says Susan Merrick, the New York-based managing director and US CMBS group head, in a release. "Highly levered loans on transitional assets that were originated at the height of the market are proving particularly susceptible to performance default, as the deepening recession continues to make stabilization according to schedule increasingly unlikely."