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MetLife, Norges Bank unit target U.S. commercial properties in new venture

One Financial Center, Boston
One Financial Center, Boston

MetLife and Norges Bank Investment Management started a joint venture to invest in U.S. office properties, confirmed Robert Merck, senior managing director and head of MetLife Real Estate Investors.

It is the first “large venture” with an institutional investor for MetLife, which launched a new money management unit — MetLife Investment Management — in October 2012, Mr. Merck said. MetLife Real Estate Investors is a subsidiary of MetLife IM.

MetLife and NBIM announced their initial investment Friday, One Financial Center in Boston. NBIM — which manages the investments of the 4.921 trillion kroner ($811.5 billion) Government Pension Fund Global, Oslo — acquired a 47.5% stake in the property from an affiliate of Beacon Capital Strategic Partners V, managed by Beacon Capital Advisors, while MetLife acquired an additional 2.5%, bringing its total ownership to 52.5%. The deal closed earlier this month.

The gross value of One Financial Center is $700 million; NBIM acquired its share for $238 million, according to a news release from the sovereign wealth fund.

Mr. Merck said he could not discuss details on the target size of the joint venture, but said MetLife is excited to expand its real estate platform with a sovereign wealth fund with the reputation and size of NBIM.

“We’re focusing on large, core, quality properties in the top-tier markets of the U.S.,” Mr. Merck said in a telephone interview. “We are looking at this as a long-term strategic partnership.”

MetLife will manage the assets in the joint venture.