Reuters Default

Manulife to outsource Canada real estate services to JLL, resulting in 50 job cuts

Nov 24 (Reuters) – Manulife Financial Corp ( MFC.TO ) will outsource its real estate operations in Canada to focus on its entrepreneurial investment management unit, Canada’s largest life insurer said on Thursday.

The change to a new structure will see Manulife Investment Management, which is the overseas property portfolio, cut 50 jobs, two sources familiar with the matter told Reuters on Thursday. The sources did not want to be identified because the details are not public.

Manulife will outsource leasing services to Chicago-based commercial real estate brokerage firm JLL Inc ( JLL.N ) under a short-term contract, after which services will be provided by a range of brokerage firms, the insurer said in a statement.

“As part of this repositioning, our teams working in Canada’s real estate operations will move to JLL in March 2023,” Manulife said. The company did not immediately disclose how many people will be affected.

In response to rising interest rates, companies around the world have rushed to rein in costs and reduce workforces. The Bank of Canada has raised its benchmark rate by 350 basis points since March to 3.75%, a 14-year high. Another rise is expected in December.

Among other financial services companies, Canada’s biggest lender Royal Bank of Canada ( RY.TO ) and Bank of Montreal ( BMO.TO ) recently cut jobs in the United States.

JLL Canada said it would help Manulife “achieve operational efficiencies,” but did not disclose any financial details about the companies’ collaboration.

Manulife shares rose 1.1% in early trade, outperforming the financials sub-index (.GSPTXBA) which rose marginally.

Manulife Investment Management’s real estate arm uses a pool of capital to invest in real estate in 29 cities across the United States, Asia and Canada. According to its annual report, the insurer had about C$13.2 billion ($9.90 billion) in real estate investments in 2021.

Earlier this month, Manulife reported a drop in third-quarter profit as growing concerns about an economic downturn weakened earnings at its wealth and asset management unit.

($1 = 1.3336 Canadian dollars)

Reporting by Niket Nishant and Bhanvi Satija in Bengaluru and Divya Rajagopal in Toronto; editing by Jason Neely and Jonathan Oatis

Our Standards: The Thomson Reuters Trust Principles.

Related Posts