MetLife 2006 Annual Report Download - page 74

Real Estate and Real Estate Joint Ventures
The Company’s real estate and real estate joint venture investments consist of commercial properties located primarily in the United
States. At December 31, 2006 and 2005, the carrying value of the Company’s real estate, real estate joint ventures and real estate
held-for-sale was $5.0 billion and $4.7 billion, respectively, or 1.5% and 1.5%, of total cash and invested assets, respectively. The carrying
value of real estate is stated at depreciated cost net of impairments and valuation allowances. The carrying value of real estate joint
ventures is stated at the Company’s equity in the real estate joint ventures net of impairments and valuation allowances. The following table
presents the carrying value of the Company’s real estate, real estate joint ventures, real estate held-for-sale and real estate acquired upon
foreclosure at:
Type Carrying Value %of Total Carrying Value %of Total
December 31, 2006 December 31, 2005
(In millions)
Realestateheld-for-investment ...................................... $3,499 70.2% $2,980 63.9%
Realestatejointventuresheld-for-investment............................. 1,477 29.6 926 19.8
Foreclosedrealestateheld-for-investment............................... 3 0.1 4 0.1
4,979 99.9 3,910 83.8
Realestateheld-for-sale........................................... 7 0.1 755 16.2
Total real estate, real estate joint ventures and real estate held-for-sale . . . . . . . . . . . . $4,986 100.0% $4,665 100.0%
The Company’s carrying value of real estate held-for-sale was $7 million and $755 million at December 31, 2006 and 2005,
respectively. Real estate and real estate joint ventures held-for-sale recognized impairments of $8 million and $5 million for the years
ended December 31, 2006 and 2005, respectively. The carrying value of non-income producing real estate and real estate joint ventures
was $8 million and $37 million at December 31, 2006 and 2005, respectively. The Company owned real estate acquired in satisfaction of
debt of $3 million and $4 million at December 31, 2006 and 2005, respectively.
The Company records real estate acquired upon foreclosure of commercial and agricultural mortgage loans at the lower of estimated
fair value or the carrying value of the mortgage loan at the date of foreclosure.
Real estate and real estate joint ventures were categorized as follows:
Amount Percent Amount Percent
2006 2005
December 31,
(In millions)
Office...................................................... $2,709 55% $2,597 56%
Apartments .................................................. 739 15 889 19
Retail ...................................................... 513 10 612 13
Developmentaljointventures....................................... 169 3 — —
Realestateinvestmentfunds....................................... 401 8 45 1
Industrial.................................................... 291 6 284 6
Land....................................................... 71 1 43 1
Agriculture................................................... 32 1 32 1
Other ...................................................... 61 1 163 3
Total ..................................................... $4,986 100% $4,665 100%
The Company’s real estate holdings are primarily located in the United States. At December 31, 2006, 26%, 15% and 15% of the
Company’s real estate holdings were located in New York, Texas and California, respectively.
Certain of the Company’s investments in real estate joint ventures meet the definition of a variable interest entity (“VIE”) under FIN No. 46,
Consolidation of Variable Interest Entities — An Interpretation of Accounting Research Bulletin No. 51, and its December 2003 revision
(“FIN 46(r)”). See “— Variable Interest Entities.”
In the fourth quarter of 2006, the Company closed the sale of its Peter Cooper Village and Stuyvesant Town properties located in
Manhattan, New York for $5.4 billion. The Peter Cooper Village and Stuyvesant Town properties together make up the largest apartment
complex in Manhattan, New York totaling over 11,000 units, spread over 80 contiguous acres. The properties were owned by the Holding
Company’s subsidiary, MTL. The sale resulted in a gain of $3 billion, net of income tax, and is included in income from discontinued
operations in the consolidated statements of income.
In the second quarter of 2005, the Company sold its One Madison Avenue and 200 Park Avenue properties in Manhattan, New York for
$918 million and $1.72 billion, respectively, resulting in gains, net of income tax, of $431 million and $762 million, respectively, and is
included in income from discontinued operations in the consolidated statements of income. In connection with the sale of the 200 Park
Avenue property, the Company has retained rights to existing signage and is leasing space for associates in the property for 20 years with
optional renewal periods through 2205.
71MetLife, Inc.