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MetLife to Sell Manhattan Apartments for $5.4 Billion

October 18, 2006|From Reuters

NEW YORK — MetLife Inc. said Tuesday that it had agreed to sell two adjoining Manhattan apartment complexes for $5.4 billion in one of the largest U.S. real estate transactions on record.

The company said it would sell Peter Cooper Village and Stuyvesant Town to a joint venture of New York real estate developer Tishman Speyer and the realty unit of BlackRock Inc.

The sale is expected to result in a gain of about $3 billion, net of taxes, for the country's largest life insurer and is planned for a fourth-quarter closing.

"For MetLife this was a good move to raise capital and free up assets on its balance sheet," said Donald Light, an analyst with Celent. "And it got a good price."

Bids were expected to be in the range of $4 billion to $5 billion. The sale would be the eighth- largest U.S. real estate transaction on record, and the third-largest for New York state, according to research firm Dealogic.

Peter Cooper Village and Stuyvesant Town on Manhattan's East Side, which were built in the late 1940s, total 11,232 units.

The complexes spread over 80 contiguous acres and are bounded by Avenue C and First Avenue on the east and west, and by 23rd and 14th streets on the north and south.

MetLife, which built the apartments and held them for nearly 60 years before announcing a sale this year, said it had considered offers from many qualified bidders, including a tenant association.

City Councilman Daniel Garodnick, who represented the tenant association, could not be reached for comment.

Jerry Speyer, chief executive of Tishman Speyer, said his company was committed to working with residents and community leaders in developing the area.

"The thousands of tenants in rent-stabilized apartments are completely protected by the existing system," he said.

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