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(Bloomberg) — MetLife Inc. Chief Financial Officer John McCallion sees a positive outlook for commercial real estate in 2025 amid improving returns from related funds as well as supportive economic conditions.
The combination of healthy economic growth, potentially declining interest rates and stronger transaction activity indicates that the real estate sector, excluding office, has hit its trough, McCallion said in a call with analysts on October 31. MetLife sold five properties in the third quarter, reaping gains of $120 million to $150 million, he said.
“Overall there is a positive backdrop that’s starting to emerge,” McCallion said. “We’re not going to see kind of a V-shaped recovery per se, but it’s certainly setting up for a more positive 2025 environment.”
Real estate and other funds’ returns improved in the third quarter, Chief Executive Officer Michel Khalaf said on the same call. Still, the insurer’s private equity investments provided lower-than-anticipated returns, weighing on its variable investment income for the period.
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