Crestpoint Real Estate Investments and Redbourne have teamed up to purchase Place du Canada, the 22-storey office tower at 1010 de la Gauchetière St. in downtown Montreal.
Crestpoint owns 97 per cent of the building and Redbourne, which will manage and handle leasing of the tower, owns the other three per cent. Place du Canada was previously owned by Crédit Suisse and managed by Canderel.
Jamie Miller, senior director, acquisitions and asset management at Toronto-based Crestpoint, would not divulge the purchase price but told RENX it was bought at “significantly below replacement cost.”
Place du Canada, which has about 384,000 square feet of leasable space, is assessed at $100.2 million by the City of Montreal. The off-market sale, which closed at the end of 2019, was handled by CBRE.
“We felt it was a good opportunity to buy and reposition it through (a) more active management and leasing strategy and (to put) some significant capital investments in the property through improvements,” Miller said.
The momentum in Montreal’s office leasing market “doesn’t seem to be showing signs of slowing down economically, so it was a great opportunity to buy,” he said.
“Everything looked promising and with a good hands-on approach, it looked like a good opportunity to increase returns.”
About Place du Canada
Built in the late 1960s, Place du Canada was commissioned by Canadian Pacific Investments, according to the Canadian Centre for Architecture. The building shares a podium and plaza level with the Montreal Marriott Château Champlain hotel next door and fronts the historic Place du Canada square.
Place du Canada is about 70 per cent occupied, giving it a vacancy rate substantially higher than the average for downtown Montreal. The building also has two levels of retail at the concourse level and 352 underground parking spaces.
National Bank, the largest tenant in the complex, is also scheduled to depart to its new headquarters at 800 Saint-Jacques St. W. in December 2023. Crestpoint views the vacancy “as an opportunity to get in and be very active and hands-on to improve it,” Miller said.
At the end of January, CN will also be vacating two floors with 34,000 square feet of contiguous space, making it the largest contiguous space currently available for lease in the building.
Crestpoint plans significant improvements
Place du Canada “is in great shape” but requires cosmetic and physical improvements. Crestpoint plans to make significant capital improvements, with upgrades to the elevators, lobby, common areas and tenant offices.
Work will start this year and continue over several years, with the bulk of the renovations to be completed during the next five or six years.
Miller considers Place du Canada to be a high-end, class-B-plus building but “we expect to operate to an A-class standard” once the renovations are completed. “It’s definitely an A-plus location.”
Place du Canada is directly connected to the Métro at Bonaventure station and to Central Station through the underground network.
It’s the second downtown Montreal building Crestpoint and Redbourne have worked on together. Redbourne has been managing and leasing Place Telus at 630 René-Lévesque Blvd. W., for which Crestpoint acquired a majority stake in September 2018.