Bentall Kennedy High Yield Canadian Property Fund I first closes at $145M

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By Ted Liu

Bentall Kennedy (Canada) Limited Partnership has held a first close for Bentall Kennedy High Yield Canadian Property Fund I Limited Partnership with $145 million in commitments: $115 million from three Canadian institutional investors from BC, Ontario, and Quebec, and $30 million from Sun Life Assurance Company of Canada.

Blake, Cassels & Graydon LLP acts as legal counsel to Bentall Kennedy.

To date, the fund has made 3 loan commitments for an aggregate of $25.4 million, with investments in Vancouver and Calgary.

“The early success in raising capital for our High Yield Canadian Property Fund is a clear recognition from the marketplace of the tremendous opportunity that our relationship with Sun Life Investment Management offers for our institutional clients,” said Malcolm Leitch, Chief Operating Officer, Investment Management, Bentall Kennedy.

Sun Life Financial acquired Bentall Kennedy in September 2015 with the goal of expanding and diversifying the real estate capabilities of its Sun Life Investment Management business, which provides investment services to third parties and manages Sun Life’s general account.

The fund will utilize Bentall Kennedy’s expertise in real estate equity investments combined with Sun Life Investment Management’s leading capability in the commercial mortgage market. The Fund is targeting an internal rate of return to investors, after fees, of 7% to 9%, primarily through lending secured by well positioned real estate projects across Canada. The fund will invest in high ratio first mortgages, mezzanine loans, land loans, second mortgages, participating debt and direct real estate equity.

“The strength and capabilities of the combined real estate equity and debt team at Bentall Kennedy and Sun Life Investment Management enables us to offer our clients a differentiated investment vehicle that complements our other products and lets our clients choose the real estate strategy most suited to them,” said Phil Gillin, Executive Vice President & Portfolio Manager, Bentall Kennedy and Sun Life Investment Management.

photo credit: Bentall Kennedy