(Bloomberg) – MetLife Inc., the largest U.S. life insurer, loaned about $14.3 billion for commercial real estate globally last year, the most in the company’s history of more than 140 years.
That’s an 18 percent increase from $12.1 billion the year before, the New York-based insurer said Tuesday in a statement. MetLife also committed to investing about $1 billion in real estate equity in 2015 through direct acquisitions and joint-venture partnerships.
MetLife is seeking higher yield for its more than $500 billion investment portfolio amid pressure from low interest rates. The insurer, which has teamed up with Norway’s sovereign wealth fund on some real estate deals, originated more than $1.6 billion of loans in the U.K. in 2015 and more than $200 million in Mexico.
“Following our strategy of investing in major markets with strong fundamentals, MetLife strengthened its position as a leader in commercial mortgage lending both domestically and internationally,” Robert Merck, senior managing director and global head of real estate investments for MetLife, said in the statement.
The insurer said in September that it had lent about $333 million to help refinance Taubman Centers Inc.’s Mall at Short Hills, a luxury shopping center in New Jersey. It loaned $505 million in July to refinance a hotel portfolio at Universal Orlando Resort in Florida.
Institutional investors are increasingly looking to more-illiquid securities such as real estate as shelter from stock- market volatility, according to BlackRock Inc., the world’s largest asset manager. The New York-based company said Monday that almost half of those responding to a survey of about 170 of its institutional clients plan to increase their allocation to real estate investments.
Other institutional investors, including pension funds, have teamed up with MetLife for real estate deals. The insurer announced earlier this month that it formed a venture with the New York State Common Retirement Fund, which includes an initial investment portfolio valued at more than $1.4 billion.
MetLife’s largest equity real estate deals in 2015 included a $340 million investment in a majority stake in a 43-story office tower being built in San Francisco and the $170 million investment in a Tokyo retail building.
– With assistance from Sarah Mulholland.