MetLife wins $500m US real estate lending mandate

MetLife has won a $500 million separate account mandate to invest in US commercial real estate loans, PDI sister title, Real Estate Capital reported.

Through MetLife Real Estate Investors, the company will originate and service first mortgage and mezzanine loans across office, multi-family, retail, industrial and hotel assets. The investment was made by a US reinsurance company.

The mandate will issue fixed and floating rate loans of at least $20 million. The fixed rate loan terms will stretch between five and 30 years, while the floaters will carry three- to 10-year terms.

MetLife Real Estate Investors’ debt platform currently has total commitments of more than $6 billion in separately managed accounts from five insurance companies and one bank, with $1.3 billion in assets under management.

In November, the company closed a similar commercial mortgage mandate for a US life insurer to invest $300 million, when it was also preparing to launch and begin fundraising for its first debt fund, MetLife Commercial Mortgage Income Fund.

Led by Robert Merck, MetLife Real Estate Investors is one of the largest commercial real estate lenders. The business originated approximately $12.1 billion globally in commercial real estate loans in 2014, topping 2013’s $11.5 billion and setting a company record. Of the $12.1 billion total, $8.6 billion were US loans.

Real Estate Capital also reported that MetLife has completed its first loan in Ireland.

The US life insurance group has provided Kennedy Wilson and Fairfax with €131 million of senior debt to refinance a collection of Dublin assets, as the pair look to take advantage of their early entry into the resurgent Irish market which has been rapidly rising over the past two years.

MetLife issued a 10-year, fixed-rate loan on three multi-family residential properties in Dublin, The Alliance, Sandford Lodge and Clancy Quay totalling 751 units. It has also provided a five-year, floating-rate loan secured against the Brooklawn House office building in Ballsbridge, also in the capital city.

The loans reflect loan-to-values in the region of 60 percent. Margins for prime assets in Dublin are close to 200bps. They are the first commercial mortgages in Ireland for MetLife and its first in Europe with Kennedy Wilson.