The economic comeback post-COVID is indeed helping CRE generally–but instead of bringing delinquent properties current, it's keeping more distress at bay.
A new analysis from Moody's Analytics REIS notes that the pandemic "exposed weak assets, hastening their deterioration," particularly when it comes to older retail centers in slow growth areas and lodging properties catering to business travel.
But despite that, "lenders and borrowers seem to be more inclined to provide a path to survival in this sector," write Moody's David Salz and Thomas LaSalvia. "Workouts, modifications/forbearance, and even going current have been more apparent in lodging than retail. As a borrower, the option to bring the loan current and retain the property seems a good move in a firming/rising market."
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