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Fitch: Hotel, Retail Defaults Spike CMBS Delinquencies

NEW YORK CITY-Five loans of $100 million-plus drove a record $2.2-billion increase in late-pays for June, according to Fitch Ratings.

By Paul Bubny | Updated on July 13, 2009

NEW YORK CITY-Five loan defaults of $100 million or more, including two sponsored by General Growth Properties, helped propel a record $2.2 billion increase in new CMBS delinquencies last month, Fitch Ratings said on Monday. Led by retail and hotel defaults, late-pays rose 48 basis points in June to 2.55% of CMBS loans, according to the ratings agency.

Last month, 13 hotel loans totaling $596 million defaulted. These included the $190-million Pointe South Mountain Resort in Phoenix, the $117-million Loews Lake Las Vegas in Las Vegas, and the $100-million Dream Hotel located in New York City.

According to a release, Fitch expects hotel delinquencies to continue to grow, with an additional $608 million of Fitch-rated hotel loans 30 days past due as of June 30. Included in this group were three notes totaling $293.8 million from portfolios of Red Roof Inn properties, which Fitch expects will move into its loan delinquency index next month.

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