Commercial Real Estate Delinquency Rate Doubles

Commercial Real Estate delinquency rates have increased dramatically year-over-year. The latest numbers from the Federal Reserve for Q4 2008 put the current delinquency rate on commercial real estate loans at 5.36% across all banks, and 5.27% at the largest 100 banks. 5.27% is nearly double the 2.65% recorded in Q4 2007, and a 10% quarter-over-quarter increase from Q3 2008.

The Federal Reserve defines delinquent loans as those which are past due thirty days or more and still accruing interest as well as those in nonaccrual status. They are measured as a percentage of end-of-period loans.

In addition, the Fed also measures charge-off rates, which are the value of loans removed from the books and charged against loss reserves.

That rate is currently at 2.04% (Q4 2008) across all banks, up from 1.16% in Q3 2008, and .35% in Q4 2007, which represents a nearly 600% increase year-over-year.

Historical data can be found here.

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