The State of Wisconsin Investment Board (SWIB) has selected Toronto-based commercial real estate investment manager Bentall Kennedy to manage a $150 million US medical office separate account, marking the $83.41 billion pension plan’s first foray into the sector.
The strategy, which will focus on core and value-added assets, will invest solely in existing properties. The mandate will serve as a part of SWIB’s core portfolio.
Bentall Kennedy’s hire comes a month after SWIB announced it had begun a search for a medical office manager. SWIB told PERE that there is no current timeline in place for deploying the capital.
“Demographics in the US indicate an aging population that will need increasing levels of medical care,” commented SWIB spokesperson Vicki Hearing on the pension’s reasons for investing in the strategy.
Currently, 4 percent of Bentall Kennedy’s US assets under management are invested in medical office properties, representing approximately $372 million as of December 31, 2013. According to documents from the SWIB website, the separate account marks the pension’s first investment with Bentall Kennedy.
SWIB, which has a real estate target of 7 percent, invests as a sole direct owner or in joint ventures and partnerships with outside managers that are diversified by location and property type. Recent SWIB commitments include $200 million to The Blackstone Group’s Blackstone Real Estate Partners Edens transaction and $187.5 million to Brookfield Asset Management’s Brookfield Core Plus Office Fund.