MetLife Inc. has purchased EnV, a 249-unit luxury rental tower in Chicago, the insurance company announced on Wednesday.
A sales price wasn't disclosed, but Crain's Chicago reported in October that the tower would sell for around $125 million, or around $500,000 per unit.
EnV is an excellent fit for MetLife's real estate equity strategy of acquiring core properties in top-tier markets, said Robert Merck, senior managing director and head of real estate investments for MetLife, in a statement. We manage each of our investments for the long-term, and we are pleased to add this best in class property to our portfolio.
The acquisition comes as MetLife is closing its residential mortgage unit.
The seller was Texas-based Lynd Development Partners, which built the tower. The building is currently 93 percent leased, after opening last May around 40 percent leased.
It had a real solid, consistent lease-up, A. David Lynd, president and chief operating officer of Lynd, told International Business Times.
The building has studio, one and two-bedroom units, along with 27,000 square feet of retail space. Rents range from $1,662 per month for studios to $4,003 per month for a two-bedroom. Rents per square foot have set a record for Chicago, said Lynd.
In general, the U.S. multifamily rental market has outperformed the sales market, with vacancy rates dropping, particularly in large cities.
Rentals are just more stable. They're more predictable, said Lynd.
With the building substantially leased and low interest rates available, the developer and its financial partners felt the timing was right to sell the project, which was built with an eventual sale in mind.
Institutional capital is always looking for super high-quality buldings because they're resilient in the market, added Lynd.
EnV was Lynd's first project in Chicago. Valerio Dewalt Train Associates was the architect, and the developer plans to continue to work with them and continue using the EnV brand for future buildings. It is looking at Austin and Miami for its next rental project.
Real estate brokerage CBRE's Chicago office represented the sellers in the deal.