American public pension plan purchases one-third interest in Bentall Kennedy

The California Public Employees’ Retirement System (CalPERS) has become a one-third owner in Bentall Kennedy, one of North America’s largest real estate investment advisors  with 140 million square feet of office, retail, industrial, hotel, and apartment properties totaling $28.7 billion (as of March 2012) throughout Canada and the U.S.

“Bentall Kennedy has a track record of fiduciary excellence and is a global leader in environmental, social and governance practices,” said Rob Feckner, president of the CalPERS Board of Administration. “This relationship will allow our real estate team to further expand on trends and opportunities in real estate investment and management.”

CalPERS, the largest public pension plan in the United States, has acquired the ownership interest that has been held for the past two decades by Ivanhoé Cambridge, the real estate subsidiary of the Caisse de dépôt et placement du Québec. The remaining two-thirds limited partnership ownership is evenly split between the British Columbia Investment Management Corporation (bcIMC) and Bentall Kennedy’s senior management team.

For Ivanhoé Cambridge, the sale is part of a strategic process to, over the long-term, bring more of its real estate activities in house. “We have been very pleased with the success in our equity investment in Bentall Kennedy,” said Daniel Fournier, Chairman of the Board and Chief Executive Officer of Ivanhoé Cambridge. “It was the product of an effective and mutually beneficial relationship.”

CalPERS said Ivanhoé Cambridge’s record of successful long-term investment with Bentall Kennedy also was a factor in its decision. “Ivanhoé Cambridge has been a significant owner in our firm for almost 20 years,” said Gary Whitelaw, Group Chief Executive Officer of Bentall Kennedy. “We have been very privileged to learn from their talented people represented on our Board and within their real estate operations. The seamless transfer of their ownership to a new strategic partner is beneficial for all involved.”

CalPERS administers retirement benefits for more than 1.6 million California state, local government, and public school employees, retirees, and their families on behalf of more than 3,000 public employers, and health benefits for more than 1.3 million enrollees. The average CalPERS pension benefit is $2,332 per month. The average benefit for those who retired in the most recent fiscal year that ended June 30, 2011, is $3,065 per month.

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