Revised SIP&P for Bentall Kennedy Prime Canadian Property Fund
Plan sponsors may wish to consider whether this investment news has any implications for the investment options available within their plans. Sun Life Assurance Company of Canada purchases units of the funds listed below, which are established as segregated funds in accordance with the Insurance Companies Act (Canada).
In the first quarter of 2017, Bentall Kennedy revised its Statement of Investment Policies and Procedures (SIP&P) for the Bentall Kennedy Prime Canadian Property Fund (BK Prime). BK Prime is a direct real estate fund available on Sun Life's INVO Core platform and is also an underlying fund of the Bentall Kennedy Canadian Real Estate Plus Fund (BK Plus). BK Plus, invests in BK Prime as well as cash and REITs; BK Plus is available on Sun Life's DC Core Investment Platform.
The Performance Objectives section of BK Prime's SIP&P lists two quantitative benchmarks. The first benchmark is to exceed the return of the Consumer Price Index +4% over a four-year period. This benchmark remains in place.
The second benchmark was to exceed FTSE TMX Canada Universe Bond Index Yield +2%. This benchmark was replaced with the REALPAC/IPD Canada Quarterly Property Fund Index (net of fees). As of March 2017, the Fund's performance objective is to generate a four-year rate of return, net of fees, which exceeds the Consumer Price Index +4% and meets or exceeds the REALPAC/IPD Canada Quarterly Property Fund Index.
The REALPAC/IPD Canada Quarterly Property Fund Index (net of fees) measures unlevered total returns of directly held standing property investments from one valuation to the next. The index tracks performance of 2,442 property investments, with a total capital value of $138.4 billion (CAD) as at June 2016. The market coverage is estimated to be 37.4% of the professionally managed real estate investment universe with results dating back to 2000.
BK Plus' benchmark has not changed. Its benchmark is a blend of BK Prime's benchmark as well as a REIT and cash component. The benchmark for BK Plus is comprised of 70% Consumer Price Index +4%, 10% S&P/TSX Capped Canadian Real Estate Income Trust (REIT) Index, and 20% Average Yield on Government of Canada 1-month T-bills.
A copy of the revised SIP&P is available on Sun Life Financial's Plan Sponsor Services website at sunlife.ca/sponsor. When logged into the website, under the Administration and Reporting tab, select Group Retirement Services, then on the top navigation menu select Investments>> Governance reports.
Please contact your Sun Life Financial Group Retirement Services representative.