The commercial real estate market was much better positioned entering this crisis than the global financial crisis of a decade ago, reported FS Investments.
However, CMBS spreads have widened considerably year-to-date, and delinquencies are on the rise. J.P. Morgan forecasts that in a GFC-like scenario, serious delinquencies may peak at 5 percent in 2021, and cumulative losses for certain vintages could range from 6 percent to 9 percent.
Trepp forecasts that in a “severely adverse” scenario, cumulative losses on commercial real estate bank loans would reach 2.7 percent, lower than the 3.8 percent during the GFC.
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