TORONTO—Sun Life Financial has agreed to acquire real estate investment manager Bentall Kennedy for C$560 million (US$454 million), the two companies said Monday afternoon. Expected to close in the third quarter, the acquisition is intended to broaden Sun Life's asset management platform.

Post-closing, the two firms will combine their real estate investment management teams. Bentall Kennedy will retain its brand name, operating as Sun Life's exclusive real estate investment management platform as part of Sun Life Investment Management.

Bentall Kennedy had C$27 billion in assets under management as of March 31—including Sun Life's Toronto headquarters. The combined Bentall Kennedy and Sun Life team will manage C$47 billion worth of assets for more than 550 institutional clients and investors in the US and Canada.

Among those institutions are Bentall Kennedy's institutional shareholders, the British Columbia Investment Management Corporation and the California Public Employees' Retirement System. Both have signed off on the transaction and will continue to be key clients of Bentall Kennedy under Sun Life's ownership.

“The purchase of Bentall Kennedy complements Sun Life Investment Management's expertise in asset-liability management, fixed income and alternative asset classes by extending our real estate and mortgage investment capabilities,” says Steve Peacher, president of Sun Life Investment Management and CIO of Sun Life Financial. “The two companies also share a common focus on customers, quality investments, strong governance and a commitment to sustainability. Together, we are well-positioned for future growth to meet the needs of pension funds and other institutional clients.”

Gary Whitelaw, group CEO of Bentall Kennedy, will continue in that capacity after the sale, reporting to Peacher. “For more than 100 years, Bentall Kennedy has been providing top-ranked service and strong performance for its clients,” he says. “My colleagues and I are excited to take this next step in our evolution.”