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Portfolio > Alternative Investments > Real Estate

MetLife Agrees To $1.72 Billion Building Sale

By Allison Bell

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A giant New York insurer has announced its second mammoth real estate deal in less than a week.[@@]

The insurer, MetLife Inc., has agreed to sell the MetLife Building, formerly known as the Pan Am Building, to Tishman Speyer Properties L.P., New York, for $1.72 billion.

The sale of the 59-story, 2.8 million-square-foot building, which rises above Grand Central Station at 200 Park Ave., Manhattan, should bring MetLife a net gain of about $750 million but will have no material effect on operating income, MetLife says.

MetLife hopes to complete the sale by June 30.

MetLife will continue to lease space for its boardroom and several other company offices in the building and will keep the “MetLife” sign on top of the building, MetLife says.

The building at 200 Park Ave. ” is an iconic and highly valuable asset and we are very pleased with the market reaction we received,” Robert Merck, head of real estate investments at MetLife, says in a statement about the deal. “ Tishman Speyer is one of the leading owners and operators of trophy real estate in Manhattan and we look forward to working with a real estate firm of their caliber and reputation.”

Although MetLife has its official headquarters in the MetLife Building and employs more than 100 people there, many more of its New York-area employees now work in Long Island City, N.Y., a company spokesman says.

The MetLife Building opened as the Pan Am Building in 1963. The architect Walter Gropius designed the building to look like the wing of an airplane.

MetLife announced March 30 that it was selling its former headquarters building, at 1 Madison Ave., Manhattan, to SL. Green Realty Corp., New York, a real estate investment trust, for $918 million. That 50-story building was the tallest building in the world from 1909 to 1913.

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