London-based Grosvenor has acquired Philadelphia-based Legg Mason Real Estate Services Inc. to boost its real estate investment management presence in North America.

The deal grows privately owned Grosvenor’s assets under management to approximately $17.3 billion in 17 countries, including $3.3 billion in the United States. The former Legg Mason Real Estate’s contribution to that total is approximately $1.7 billion of domestic investments under management from a range of clients including public pension funds, insurance companies, high net worth individuals and foreign institutional investors.

The merger gives clients from both firms a broader spectrum of investment options, according to John Flavin, a managing director who is relocating from Grosvenor’s San Francisco office to the merged group’s new headquarters in Philadelphia.

“One of the things we wanted was some access to and familiarity with U.S. institutions,” Flavin says. “Grosvenor has relationships with a lot of life insurance companies and pension funds in the UK and Europe, and we’ve had some limited exposure to Canadian funds, but not here in the U.S. The people from Legg Mason Real Estate Services have relationships with a number of U.S. funds.”

Clients of the former Legg Mason will benefit from Grosvenor’s offerings as well. “Now they have an opening into offshore investments, which many institutions in the U.S. are now considering,” Flavin says.

Grosvenor is an international property development, investment and fund management group with operating companies in Britain and Ireland, the Americas, Europe and the Australia Asia Pacific regions.

Douglas Callantine, president of Legg Mason Real Estate Services at the time of the acquisition, heads the combined investment management operation, which has a staff of 30. With headquarters in Philadelphia, the acquired business adds a further hub to Grosvenor’s North American network, which currently operates from offices in Vancouver, San Francisco and Washington, D.C.

Grosvenor’s expanded investment management business in the U.S. will focus on developing funds for both domestic and international investors, complementing Grosvenor’s existing property company activities in North America.

“This acquisition fulfills an important goal to expand Grosvenor’s investment management activities into the U.S.,” says Stuart Beevor, Grosvenor’s fund management director. “We are delighted to have found a company which, like Grosvenor, has a 50-year track record in North America, and also has an excellent reputation and people who share our philosophy and values.”