As New York City led in 2024 CMBS conduit issuance for multifamily properties, so it is also leading an increase in multifamily conduit delinquencies, Kroll Bond Rating Agency reported.

The overall KBRA distress rate for apartment-backed conduit loans, which includes loans that are delinquent or current and in special servicing, was at 8.5% as of year-end 2024. NYC multifamily currently represents 43% of the multifamily distressed balance, with a distress rate of 14.4% at year-end. That’s more than double the city’s year-end 2023 distress rate of 7%.

The city’s multifamily distress rate was distinctly bifurcated by property age, according to KBRA. Pre-1974 NYC properties, which have a much higher proportion of rent-stabilized buildings, had a 25.1% distress rate by balance, compared to post-2000 properties with a distress rate of 2.9%. Manhattan had the highest distress rate of the five boroughs at 29.8%, followed by Queens (7.5%) and Brooklyn (3.2%).