EnCana Corp. (TSX:ECA) has turned over its $1-billion-plus Bow office-tower project to H&R Real Estate Investment Trust (TSX:HR.UN) and signed a 25-year lease on all of the landmark 59-storey building.
The natural gas and oilsands company said it received $70 million on the sale, and this amount "largely represents EnCana's investment to date."
The lease, described as the largest single-tenant lease in Canadian history, carries an initial rental rate of about $36 per square foot for "state-of-the-art office space in the Calgary market" upon the project's completion, scheduled for 2011.
The sale includes the development plans and contracts for the 1.9-million-sq.-ft. building on the north block between 5th and 7th Avenues between Centre and 1st Streets S.E., which will be the tallest office building in Western Canada, and the 200,000-sq.-ft. development on the south block.
The crescent-shaped north block building is budgeted at $1.1 billion, with construction to begin this summer.
The development is intended to consolidate EnCana's current office space spread over five downtown Calgary buildings.
Toronto-headquartered H&R REIT owns a North American portfolio of 34 office, 115 industrial and 143 retail properties totalling 41 million sq. ft.
