NEW YORK CITY—In a deal worth up to $5 billion, MetLife Inc. has entered into an agreement with SunTrust Banks Inc. wherein the bank will finance commercial real estate mortgages originated and managed by MetLife Real Estate Investors. The partnership, structured for locally based MetLife’s newly created investment management platform, is for a three-year period and would result in SunTrust providing as much as $5 billion to commercial real estate.
“We welcome SunTrust as a client and partner as it brings strong regional and national expertise that complements our long-standing real estate investment heritage,” says Steven J. Goulart, executive vice president and chief investment officer of MetLife. “This unique partnership supports our larger strategy to provide innovative and reliable investment vehicles to our clients.”
The company recently launched its institutional asset management business to leverage its institutional investment capabilities, and to build upon its commercial mortgage origination and private placement debt businesses, as well as real estate equity investment. Since its formation, the new division has been tapping into local market knowledge and industry relationships to uncover quality investments that offer attractive risk-adjusted returns. The strategic partnership with SunTrust is the latest in these endeavors.
The deal also strengthens SunTrust’s commitment to commercial real estate. Walt Mercer, the bank’s executive vice president and commercial real estate head, states, “As the commercial real estate market continues to regain its footing, we’re actively seeking opportunities that make sense for our clients, SunTrust and our investors.” This agreement, he adds, “satisfied all of our criteria and we look forward to its potential.”
As for MetLife, the firm’s goal is to be one of the top five institutional real estate investment managers, according to Robert Merck, global head of MetLife REI. “With this mandate from SunTrust, we are confident the company is headed in the right direction,” he says. “We will continue to offer institutional investors our market-leading origination platform, underwriting expertise and superior customer service to earn and retain their business.”
MetLife is one of the largest portfolio lenders in the industry with $43.1 billion in commercial mortgages outstanding at the end of 2012, and with more than $9.6 billion in commercial mortgage loan originations in 2012. Based in Atlanta, SunTrust Banks Inc. is one of the largest banking organizations in the US, with total assets of $171.5 billion and total deposits of $127.6 billion as of midyear.