(Bloomberg) -- National Bank of Canada plans to invest more than C$500 million ($402 million) to build a new headquarters near the old city of Montreal that will be the largest office tower built in the area in 25 years.
National Bank will be the sole occupant of the estimated 36-story tower on the corner of St-Jacques Street and Robert Bourassa Boulevard, on the same street where the bank had a head office more than 100 years ago, spokesman Claude Breton said in a phone interview. The tower that currently houses the head office will be sold, with proceeds directed to the new building, slated for occupancy in 2022.
Canada’s sixth-biggest lender purchased the site near the central train station last week from Montreal-based Broccolini Construction Inc., said Breton. Part of the site is still owned by Broccolini, which will be developing condominium towers on the property, he said.
Broccolini will be involved in the construction of the new headquarters along with other partners including Quebec construction giant Pomerleau Inc., Breton said.
“Returning to Saint-Jacques Street is particularly meaningful since National Bank had a head office on that very street over a century ago,” Chief Executive Officer Louis Vachon said in a statement Tuesday. “With this new location at the entryway to Montreal, National Bank will bring most of its various Montreal teams together under one roof to give their activities even greater impact.”
National Bank’s announcement comes two months after Manulife Financial Corp. opened its new Quebec headquarters in Montreal’s financial core to house insurance and asset-management employees. The city’s commercial real estate is catching up to Canada’s most populous cities of Toronto and Vancouver, as demand for assets has sent prices soaring.
Canada was set to top records for commercial-property investments in 2017, according to CBRE Group Inc., and downtown office vacancy rates are among the lowest in North America. Montreal is Canada’s third-hottest commercial market with C$3.5 billion in transactions in the first three quarters of last year, trailing Toronto and Vancouver, which saw C$12 billion and C$8.1 billion respectively.
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