The mixed-use delinquency rate saw the most substantial increase over the year, with a Y-O-Y gain of 129 bps. Fitch says the large increase was due mainly to the addition of two loans to the index: the $150-million City Place loan (the Fitch-rated CSMC 2007-C1 transaction) and the $132.5-million NGP Rubicon GSA Pool loan (WBCMT 2005-C20 and WBCMT 2005-C1).

Next up were industrial delinquencies, which increased 58 bps over the year to 4.46%. While the sector's delinquencies of $297 million almost equaled resolutions of $298 million, the overall denominator of industrial loans decreased to $11 billion from $13 billion during the year. Industrial activity was “minimal” last year, with no loans over $50 million moving in or out of the index, according to Fitch.

Office reported the next largest delinquency rate increase, rising by 27 bps from the year-ago period to 4.88%. While office delinquencies of $2.72 billion nearly matched resolutions of $2.74 billion, the overall denominator of office loans decreased to $81 billion from $86 billion during the year.

Retail, which continues to comprise the largest percentage by balance of Fitch's delinquency index, recorded a five-bps delinquency rate increase to 5.25% from the end of 2015. Although retail resolutions of $3.14 billion surpassed delinquencies of $2.78 billion during the year, the overall denominator of retail loans decreased significantly to $86 billion from $94 billion.

Last and least, the hotel delinquency rate remained relatively flat, increasing one bp from the year prior to 3.83%. Hotel resolutions of $788 million during the year edged out resolutions of $706 million. The largest new hotel delinquency in 2016 was the JQH Hotel Portfolios (JPMCC 2006-LDP7 and CD 2007-CD4), which has been in and out of Fitch's delinquency index.

NEW YORK CITY—As 2016 closed, CMBS delinquencies were off 21% by balance from a year ago. However, Fitch Ratings sees them heading back in the wrong direction as the current year progresses, driven by CMBS 1.0 delinquencies, which have risen for 11 consecutive months.

The ratings agency sees “continued pressure” on CMBS 1.0 loans this year from approximately $47 billion of loans within Fitch-rated transactions that are scheduled to mature in 2017. Accordingly, Fitch projects “significant delinquencies” from these maturing loans, many of which are highly leveraged and expected to have difficulty refinancing.

Assuming current market refinance rates for these maturing loans and factoring in similar new issuance volume for this year, Fitch is predicting the overall delinquency rate will increase to between 5.25% and 5.75% by year's end. It finished December at 3.34%, up five basis points from November but down 68 bps from a year earlier. The CMBS 1.0 late-pay rate is now more than 15%, and 45% of delinquent pre-2009 loans are REO.

However, Fitch attributes any year-over-year improvement broadly to one asset class: multifamily. The apartment sector's delinquency rate saw a decline of 338 bps over the course of '16, to end the year at 0.81%. Multifamily resolutions during the year totaled $3.55 billion, far surpassing new delinquencies of $560 million. Much of the $3.55 billion in resolutions occurred via the resolution of a single transaction: the $3-billion Peter Cooper Village/Stuyvesant Town loan.

The mixed-use delinquency rate saw the most substantial increase over the year, with a Y-O-Y gain of 129 bps. Fitch says the large increase was due mainly to the addition of two loans to the index: the $150-million City Place loan (the Fitch-rated CSMC 2007-C1 transaction) and the $132.5-million NGP Rubicon GSA Pool loan (WBCMT 2005-C20 and WBCMT 2005-C1).

Next up were industrial delinquencies, which increased 58 bps over the year to 4.46%. While the sector's delinquencies of $297 million almost equaled resolutions of $298 million, the overall denominator of industrial loans decreased to $11 billion from $13 billion during the year. Industrial activity was “minimal” last year, with no loans over $50 million moving in or out of the index, according to Fitch.

Office reported the next largest delinquency rate increase, rising by 27 bps from the year-ago period to 4.88%. While office delinquencies of $2.72 billion nearly matched resolutions of $2.74 billion, the overall denominator of office loans decreased to $81 billion from $86 billion during the year.

Retail, which continues to comprise the largest percentage by balance of Fitch's delinquency index, recorded a five-bps delinquency rate increase to 5.25% from the end of 2015. Although retail resolutions of $3.14 billion surpassed delinquencies of $2.78 billion during the year, the overall denominator of retail loans decreased significantly to $86 billion from $94 billion.

Last and least, the hotel delinquency rate remained relatively flat, increasing one bp from the year prior to 3.83%. Hotel resolutions of $788 million during the year edged out resolutions of $706 million. The largest new hotel delinquency in 2016 was the JQH Hotel Portfolios (JPMCC 2006-LDP7 and CD 2007-CD4), which has been in and out of Fitch's delinquency index.