MetLife Wins $500 Million in Largest Third-Party Deal Sin

MetLife Inc. won a $500 million commitment from a reinsurer for commercial property lending, the largest deal for the company’s third-party asset-management real estate group since 2013.

MetLife, the biggest U.S. life insurer, will originate and service variable- and fixed-rate loans, the New York-based company said in statement Friday. Loans will generally be for at least $20 million, and could cover offices, multifamily dwellings and retail properties, according to Fred Pieretti, a MetLife spokesman who declined to identify the reinsurer.

The largest North American life companies already invest in real estate to back obligations to policyholders, and have been pushing into fund management for institutional investors to boost fee income. In December, Principal Financial Group Inc. agreed to help Australia’s largest pension fund, AustralianSuper Pty, invest in office properties in top U.S. markets.

MetLife expects to be “participating actively in what should be a strong market among both lenders and borrowers in 2015,” Lou Jug, head of investor services for the real estate arm, said in the statement. “This new mandate underscores the ability of our debt-investment platform.”

The insurer began its third-party initiative in 2012 and received a $5 billion commitment the next year from SunTrust Banks Inc. MetLife Real Estate Investors’ debt platform has $1.3 billion in assets under management, according to the statement.

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