MetLife Real Estate Investors has raised $800m (€744.3m) for its MetLife Commercial Mortgage Income Fund, according to sources familiar with the manager’s capital raising activities.
The fund is targeting real estate debt backed by existing core US real estate assets in the industrial, retail, and apartment sectors. It aims to generate a net internal rate of return of 6-7% a year.
All investors in the open-ended fund are life companies with conservative investment strategies. According to industry sources, MetLife is aiming to attract capital from other sources, including US public pension funds.
MetLife is working on the capital raise with HFF Securities as its placement agent.
MetLife would not comment on the fund launch. Tom Mizo, senior managing director for HFF, declined to comment.
The capital raised by MetLife is another example of US institutional investors looking to increase their allocations to real estate debt.
Traditional sources of capital are pulling back on lending efforts, creating opportunity for private capital sources.