Apartment loans are starting to look a lot less safe

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Multifamily CMBS delinquencies hit 8.09% in October, up from 3.24% two years ago. Office is worse at 12.33%, but apartments are now showing the fastest deterioration of any major property type over the past year. About $398 million in multifamily CMBS loans became newly delinquent in October, including three Houston loans originated in 2025.

Higher borrowing costs, insurance premiums and property taxes are squeezing owners, while rent growth hasn’t kept up with expenses in some markets. One $210 million loan on a 283-unit California apartment complex went unpaid after an extension expired. This doesn’t mean the entire apartment market is collapsing. CMBS and private securitizations account for only around 3% of outstanding multifamily mortgage debt, and national apartment fundamentals have improved this year. But owners who bought at inflated prices and financed with cheap debt are running into a very different market now. Apartments were supposed to be the safe corner of commercial real estate. That assumption is getting expensive.

https://www.trepp.com/trepptalk/cmbs-delinquency-rate-drops-15-basis-points-in-october-2026

https://www.multifamilydive.com/news/apartment-cmbs-delinquency-servicing-rate/874321/

https://www.multifamilydive.com/news/property-taxes-insurance-multifamily-cmbs-distress/

https://www.mba.org/news-and-research/newsroom/news/2026/09/28/commercial-and-multifamily-mortgage-delinquencies-mixed-in-second-quarter-2026

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