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Streetwise Sun Life Investment Management launches new institutional investment arm

Sun Life Financial Inc. has merged several of its third-party money managers to create a new institutional investment arm that will focus on fixed income and global real estate equity and debt.

The life insurer will announce on Tuesday the establishment of SLC Management, which will replace Sun Life Investment Management. As a result, all of Sun Life Investment Management’s affiliates – Sun Life Institutional Investments (in both the United States and Canada), Ryan Labs Asset Management, Prime Advisors Inc. and Bentall Kennedy – will be provided to clients on a single platform under SLC Management.

The fixed-income teams of Sun Life Institutional Investments (Canada), Ryan Labs and Prime Advisors will be rebranded SLC Management, while Bentall Kennedy will retain its name as part of the SLC Management real estate team.

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Sun Life’s move to streamline its subsidiaries into one platform comes at a time when many institutional investors – such as pension plans – are looking to reduce the number of relationships they hold with individual investment managers, preferring instead the convenience of dealing with one company.

Prior to the reorganization, an investor would have to go to each of these managers for their respective solution. Now, access will be through one integrated distribution team, says Tom Murphy, head of business strategy at SLC Management.

Last December, Sun Life Financial acquired a majority stake in the real estate investment-management firm BentallGreenOak, expanding its investment capabilities in commercial properties beyond North America.

The Toronto-based insurer merged Bentall Kennedy, a North American real estate and property-management firm that Sun Life acquired in 2015, with the global real estate investment company GreenOak Real Estate. At the completion of the acquisition – which is expected to close later this summer – Sun Life Financial will hold a 56-per-cent stake in the new firm.

Now, SLC Management will manage $212-billion in assets focused on public and private fixed income as well as global real estate and debt. BentallGreenOak will become SLC Management’s real estate division, while the remaining Sun Life subsidiaries – Prime Advisors, Ryan Labs and SLIIC – will combine under a fixed income division. There will be no executive adjustments as a result of the changes.

The transaction is consistent with the insurer’s strategy of expanding its capabilities in alternative asset management. Last December, Steve Peacher, president of SLC Management, said he would like to broaden the company’s capabilities with the private fixed income and private credit markets, as well as look to acquire an infrastructure equity manager.

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