Boston, Santa Monica, and Tallahassee lead a growing list of cities whose multifamily markets are beginning to crack, with the percentage of loans with occupancy under 80% increasing substantially over the last year. 

A new report from Trepp notes that signs of "fraying" are beginning to appear in the apartment segment across some major US markets. Boston leads the way with 28% of properties with multifamily loans with less than 80% occupancy, followed by Santa Monica (22.78%), Tallahassee (15.38%), San Francisco (14.62%), Seattle (11.02%), Kansas City (9.88%), Memphis (9.33%), Cleveland (8.82%), Marietta (8.11%), and Oklahoma City (8%).

At this point in the year, Trepp says, most borrowers have submitted net operating income and occupancy for their CRE loans for 2020. And while some markets have done quite well, others are showing weakness.  The firm examined data for more than 22,000 properties involving CMBS private-label loans and Freddie Mac loans and noted that of that total, 4.8% posted 2020 occupancies of less than 80% by property count.