MetLife Puts California Bank Portfolio on Market
Insurance giant selling 22 standalone banks leased to JPMorgan Chase, asking for $149.5M.
MetLife Investment Management is selling a portfolio of 22 standalone banks in California for an asking price of $149.5M.
The insurance giant has owned the portfolio, encompassing a total of 252K SF, since 1990. The buildings, which are located throughout the Golden State, currently are leased to JP Morgan Chase.
The portfolio is being listed on LoopNet and marketed by CBRE, according to a report in the LA News Tribune. The asking price is equivalent to an average of $593 per square foot for the assets.
The MetLife portfolio includes 12 bank buildings in Los Angeles and Orange counties, and 10 banks in San Mateo, Santa Clara and San Francisco counties.
CBRE’s Dan Riley, Bill Durslag, Simon Mattox, Austin Wolitarsky, and Kyle Woods are leading the marketing efforts on behalf of MIM.
According to CBRE’s marketing materials, Chase is paying an average of $2.14 per SF a month to rent the SoCal properties and an average of $2.62 for the NoCal assets, with the rents scheduled to increase 10% in 2025.
JPMorgan Chase holds long-term triple-net leases on the bank buildings that run through 2030, with the exception of two properties—in Torrance and San Francisco—that expire in 2025.
MetLife holds no debt on the portfolio and is willing to sell the SoCal and NoCal assets to separate buyers, according to CBRE.
The LA-area properties include banks located at 15625 Whittier Boulevard in Whittier; 2121 Torrance Boulevard in Torrance; 2270 Huntington Drive in San Marino; 2398 Sycamore Drive in Simi Valley; 401 East Valley Boulevard in Alhambra; 27319 Hawthorne Boulevard in Rolling Hills Estates; and 449 North La Brea Avenue in Fairfax.
MetLife acquired the properties from Home Savings of America in 1990 in a sale-leaseback deal. In 1999, Washington Mutual bought Home Savings in a $10B deal.
Washington Mutual, a sub-prime lender, went belly up during the 2008 financial collapse and its banking assets were sold to JPMorgan Chase for $1.9M. The buildings in MetLife’s portfolio became Chase outlets.
According to S&P, 28 US banks have reduced their overall branch footprints by more than 20% since the beginning of 2020, in a wave of branch closures known in the industry as “The Great Consolidation.”
Bank branch closures peaked at 1,182 in Q4 2020, with closures totaling nearly 2,000. In 2021, 853 branches were closed in Q1, followed by 811 and 735 in the second and third quarter of last year. The number of branch closures dipped to 307 in Q4 2021 before surging back up to 809 in Q1 2022.
The wave of bank branch closures dropped off in Q2 2022. According to S&P data compiled as of June 13, only 248 bank branch closures were reported in the second quarter.
Many banks are opting to modernize their branches to more technology-focused models in order to operate with less staff while closing fewer branches, GlobeSt.com reported. Banks are paying higher wages for fewer workers and shifting their personnel models to focus on consulting rather than transactions.