Calgary’s iconic Bow Tower is being sold.
Toronto-based H&R Real Estate Investment Trust announced the two-million-square-foot tower is being sold as part of a $1.67-billion deal that also includes the Bell office campus in Mississauga, Ont.
Oak Street Real Estate Capital, a Chicago-based private equity real estate firm, will become the owners with a lease financing agreement from Deutsche Bank.
Through the deal announced Tuesday, H&R retains 15 per cent of net rent from the existing lease of Ovintiv Inc. (formerly Encana Corp.), ownership of lands adjacent to Bow Tower, and management contracts for both facilities.
Originally opened in 2012 at a cost of $1.4 billion, the Bow Tower represents $1.22 billion of the value of the deal announced Tuesday. H&R said the sale “significantly reduces” its Calgary office exposure to three per cent from nine per cent on a fair value basis.
“Today’s announcement is evidence of our commitment to our strategic repositioning and is a critical step forward on our path to achieving a more simplified structure,” said Thomas Hofstedter, H&R’s president and CEO, in a release.
Cenovus Energy was a previous tenant of the Bow Tower, but moved to nearby Brookfield Place in 2019.