CMBS Loan Performance Sees Uptick in January 2026

KBRA reports rise in delinquency and distress rates for U.S. private label commercial mortgage-backed securities

Published on Feb. 13, 2026

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According to a new report from Kroll Bond Rating Agency (KBRA), the 30+ day delinquency rate among KBRA-rated U.S. private label commercial mortgage-backed securities (CMBS) increased to 8.1% in January 2026, up from 7.6% in December 2025. The distress rate, which reflects delinquent and current-but-specially-serviced loans, also rose to 10.7% from 10.4% the prior month. The office sector saw the largest increase, with the delinquency rate jumping 156 basis points to 13.9%, largely due to the $835 million One New York Plaza loan becoming nonperforming after transferring to special servicing.

Why it matters

The CMBS market is a key indicator of commercial real estate health, and these rising delinquency and distress rates suggest ongoing challenges in certain property sectors like office, even as other areas like retail see some improvement. The report provides valuable insights into the performance trends impacting CMBS investors and lenders.

The details

The report found that loans totaling $2.3 billion were newly added to the distress rate in January, with over half (52.7%) involving imminent or actual maturity default. The office sector experienced the highest volume of newly distressed loans at 68.5% ($1.6 billion), followed by multifamily (14.5%, $331.4 million) and lodging (6.6%, $150.2 million). Meanwhile, the retail sector saw a 54-basis point decline in its distress rate as three loans averaging $130.2 million were returned to the master servicer after resolving issues.

  • The 30+ day delinquency rate increased to 8.1% in January 2026, up from 7.6% in December 2025.
  • The distress rate edged up to 10.7% in January 2026 from 10.4% the prior month.

The players

KBRA

Kroll Bond Rating Agency, one of the major credit rating agencies, is registered in the U.S., EU, and the UK. KBRA is recognized as a Qualified Rating Agency in Taiwan, and is also a Designated Rating Organization for structured finance ratings in Canada.

One New York Plaza

An $835 million commercial mortgage-backed security (CMBS) loan that transferred to special servicing for imminent monetary default ahead of its January 2026 maturity, and became nonperforming matured balloon, after which a modification with an extension was executed.

Worldwide Plaza

A $235 million CMBS loan across four KBRA-rated conduits that became 30 days delinquent after being late on its payment in December. A new mezzanine note holder accelerated the outstanding mezzanine loan and scheduled a Uniform Commercial Code (UCC) sale for mid-January.

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The takeaway

The rising delinquency and distress rates in the CMBS market, particularly in the office sector, underscore the ongoing challenges facing commercial real estate as the economy navigates a period of uncertainty. Investors and lenders will be closely watching these performance trends to assess risk and potential impacts on their portfolios.