Bentall Kennedy client forms new real estate company to manage its own Canadian and global real estate portfolio

TORONTO, June 1, 2016 /CNW/ - Bentall Kennedy today announced that British Columbia Investment Management Corporation ("bcIMC"), a longstanding client of Bentall Kennedy, has stated its intention to establish a privately held real estate investment and property management company to manage its Canadian and global real estate portfolio. The majority of the Canadian assets to be managed by bcIMC's new entity will be assumed from the property portfolios currently managed by its three external managers, including Bentall Kennedy.

In connection with today's announcement, bcIMC has advised Bentall Kennedy that, pursuant to an existing agreement, bcIMC has elected to purchase certain wholly owned subsidiaries of Bentall Kennedy. These entities employ the Canadian employees who work on the portion of the bcIMC real estate portfolio that Bentall Kennedy manages. The purchase will be phased, commencing in the first quarter of 2017 and expected to be completed during the first quarter of 2018.

Remco Daal, the former President of Bentall Kennedy Canada, will join bcIMC's newly- created real estate company to lead its domestic Canadian operations. Gary Whitelaw will continue as Bentall Kennedy's Group Chief Executive Officer. Vancouver based Tony Astles will replace Mr. Daal as President of Bentall Kennedy's Canadian property services operations. Mr. Astles has been Bentall Kennedy's Executive Vice President responsible for property services operations in Western Canada. Paul Zemla and Malcolm Leitch will continue in their roles as Chief Investment Officer and Chief Operating Officer of Bentall Kennedy's Canadian Investment management operations. Messrs. Whitelaw, Astles, Zemla, and Leitch have been with Bentall Kennedy for 18, 23, 18 and 29 years respectively.

"We are extremely proud of our 25-year association with bcIMC. Together, we have built a high quality portfolio that has exceeded its performance benchmarks for virtually every time period," said Mr. Whitelaw, CEO of the Bentall Kennedy Group. "The strong history of partnership between bcIMC and Bentall Kennedy will provide for a phased and collaborative transfer of responsibilities, and we are also looking forward to continuing to provide development and leasing services on the 1.3 million square foot downtown Vancouver mixed use Post Office project for many more years."

Mr. Whitelaw added, "Given the successful real estate investment strategy that bcIMC has overseen with its three external managers, bcIMC's portfolio has now grown to a scale which enables it to establish an independent real estate investment and property management company, as so many of its peers have done. We wish the new entity and its employees all the best."

"For Bentall Kennedy's other 550 clients and fund investors, and for the almost 1,000 Canadian and U.S. based employees who are unaffected by the bcIMC decision, it is business as usual. Our deep expertise in all aspects of property investment and management, combined with the resources and global scope of Sun Life Investment Management, give us a North American platform that positions us to continue to meet and exceed clients' and tenants' expectations, and will create continued opportunities for our very talented team to grow and develop. In the past 12 months, Bentall Kennedy's assets under management for other clients have increased by just over $3 billion."

Excluding management of the bcIMC assets, and including the recent assumption of approximately $22 billion in Sun Life real estate and mortgage assets, Bentall Kennedy has client assets under management of approximately $43 billion (using March 31, 2016 values), making it one of the 30 largest global real estate investment managers. Bentall Kennedy's Canadian real estate services team provides property management services across approximately 60 million square feet for both its investment management clients and third party clients. Bentall Kennedy's U.S. based investment activities are unaffected by bcIMC's planned activities.

These contractual arrangements with bcIMC were disclosed to Sun Life Financial during its due diligence of Bentall Kennedy in 2015, and were considered by Sun Life in its valuation of Bentall Kennedy. The Bentall Kennedy group of companies is wholly owned by Sun Life Financial. The impact of these transactions with bcIMC is not expected to have a material impact on the consolidated financial results or operations of Sun Life Financial.

About Bentall Kennedy

Bentall Kennedy, a Sun Life Investment Management company, is one of North America's largest real estate investment advisors and one of its foremost providers of real estate services. Bentall Kennedy serves the interests of more than 550 institutional clients and investors managing approximately $43 billion of assets across office, retail, industrial, and multi-residential properties throughout Canada and the U.S. (as of the most recently completed fiscal quarter). Bentall Kennedy is a member of UN PRI and a recognized Responsible Property Investing leader ranked 1st globally in its peer group in the 2015 Global Real Estate Sustainability Benchmark (GRESB). Bentall Kennedy includes Bentall Kennedy (Canada) Limited Partnership, Bentall Kennedy (U.S.) Limited Partnership and the real estate and commercial mortgage investment groups of certain of their affiliates, all of which comprise a team of real estate professionals spanning multiple legal entities. The assets under management shown above include real estate equity and mortgage investments of the companies within Bentall Kennedy (excluding AUM relating to the bcIMC account). All amounts cited are in Canadian dollars. For more information, visit www.bentallkennedy.com.

SOURCE Bentall Kennedy

Shaun Little, Director, Corporate Communications Bentall Kennedy Group, 416.681.2726 or [email protected]