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 July 2023, BGO announced some staffing changes that impact their Portfolio Management, Asset Management, and Transactions teams.

Retirement of Portfolio Manager John McFadden

BGO announced that John McFadden, Senior Portfolio Manager (PM) and co-Lead PM on BGO Prime Canadian Property L.P.1 (BGO Prime), will retire at the end of 2024. He will leave the PM team of BGO Prime at the end of 2023. McFadden will still be available as a resource for the fund in 2024 but will spend his last year at the firm supporting other BGO Canada wide initiatives. Simon Holmes, PM, and Shishir Nigam, Associate PM, will continue in their roles in co-managing the fund. Holmes joined the PM team for BGO Prime in 2021 and has almost 20 years of investment experience. Nigam was promoted to Associate PM in 2021 and will continue to be Lead PM for BGO Canadian Real Estate Plus and support Holmes on BGO Prime.

Reduced staffing in the Transactions team

BGO also announced changes within the Transactions team. BGO decided to reduce the headcount of the Transactions team from 10 to 7 people. Departures included Michael Fraidakis, Managing Director, Head of Canadian Investments. BGO expects a lower volume of transactions in the foreseeable future following the restructuring of BGO Canadian Prime over the last few years. Staffing levels now reflect that of the Transactions team prior to that restructuring. BGO noted that Fraidakis’ role had recently shifted more towards business and product development.

New leadership role for BGO Prime Asset Management team

BGO promoted Barbara Francis to lead both the Western and Eastern Canada Prime Canadian Asset Management teams. She was previously in charge of Eastern Canada. Jaclyn O’Neill had led the Western Canadian team and split her time between asset management and transactions. O’Neill will now focus all her time on transactions. BGO stated that they made the change to streamline communication between the Portfolio Management team and the Asset Management team. The change will also allow Francis to have a national view, overseeing the regional structure.

GRS Investment Solutions View:

John McFadden’s retirement is not a surprise to us. When McFadden assumed the role of Senior Portfolio Manager in 2021, following the departures of PM’s Malcolm Leitch and Kristin Ede in 2021, BGO indicated

that it was on an interim basis and McFadden would retire within a few years. Simon Holmes, Managing Partner, will lead the PM team following McFadden’s departure, and Shishir Nigam will support him. In recent years, McFadden had moved into a primarily client-facing role. McFadden has been with BGO for 35 years and his experience will be a loss for the team. However, BGO has communicated the transition and is managing it well.

While the staffing reductions in the Transactions team are significant, we understand the firm’s “right-sizing” rationale for moving forward with a leaner team. After a period of elevated transactions in which the fund rebalanced out of the Office sector and into the Distribution and Warehouse and Multi-Family sectors, transaction activity is expected to normalize. Michael Fraidakis’ departure is a loss to the Transactions team and the firm, given he was the head of the team and had a 20+ year tenure at BGO.

The Asset Management team is responsible for managing the properties. Jaclyn O’Neill’s role on the team has not been replaced so the team in Eastern Canada drops from six to five professionals.

We have previously communicated that the totality of the senior level departures at BGO over the years has been significant and we’ll continue to monitor the stability of the current senior leaders, in the months and years to come. We’re not placing our BGO funds on our Watch List as a result of these changes. We will, however, continue to closely monitor BGO during this transition and provide further updates as necessary.

Do you have to take any action?

You and your members don’t have to take any action as a result of these changes.

Questions?

Please contact your Sun Life Group Retirement Services representative.