MetLife, Norges venture hits $2.26bn

The eight-month-old joint venture between MetLife Real Estate Investors and Norges Bank Investment Management (NBIM), the manager of Norway’s Government Pension Fund Global, will be investing in another Boston property, purchasing One Beacon Street for approximately $565 million, according to a source familiar with the situation. Along with the partnership’s three previous acquisitions, the acquisition will bring the total amount invested by the joint venture to approximately $2.26 billion since its inception in December.

One Beacon Street, which is being sold by a joint venture between Beacon Capital Partners and Allianz Real Estate, is a one million-square-foot office tower built in 1973. Beacon purchased the property in August 2006 for $423 million and later sold a 50 percent interest in the building to Allianz in 2009. At that time, the property’s grossed up price totaled $508 million, according to data from Real Capital Analytics (RCA). Located in the financial district, the 34-story building includes tenants such as Deutsche Bank, The Boston Consulting Group and the Massachusetts Housing Finance Agency.

When MetLife and NBIM established the joint venture last year, Robert Merck, head of the Morristown, New Jersey-based real estate investment firm, told PERE that the partnership would “generally target investments with a gross asset value of $250 million-plus.” The two partners have declined to say how much they plan to invest overall through the “long-term” venture.

MetLife and NBIM made their initial investment by acquiring stakes in One Financial Center, a Boston office building with a gross asset value of $700 million. In that transaction, NBIM bought a 47.5 stake in the property from Beacon for $238 million. MetLife, which already held a 50 percent stake in the building, acquired an additional 2.5 percent stake from Beacon to give the venture full ownership of the property.

In January, the JV announced that it had purchased the Thurman Arnold Building in Washington, DC from Toronto-based insurance company Manulife Financial for $500.8 million. At the same time, the venture said that NBIM had purchased a 47.5 percent share in 425 Market Street in San Francisco from MetLife, which previously held full ownership of the property. The 945,249-square-foot office building has a rumored total value of $495 million, according to RCA.