Financing secured to finish Bow building

The developer behind the Bow building in downtown Calgary has finalized financing to complete construction of the 58-storey skyscraper.

H&R Real Estate Investment Trust, which is developing the new headquarters for EnCana Corp., announced Thursday it has secured $425-million over 42 months from a syndicate of lenders led by RBC Capital Markets and TD Securities. The Bank of Nova Scotia, Bank of Montreal, Alberta Treasury Branches and Canadian Western Bank are also part of the group.

The feasibility of the project came into question earlier this month when the REIT deferred plans for the south block of the project.

Instead of a previously planned 200,000 square feet of retail, office and cultural space, the south block will now only be an underground parking garage. It was supposed to be a seven-storey project built with bricks from the demolished York Hotel that once stood in its place.

On Thursday, the REIT said 32 storeys of the north building will be completed by the end of this year. The full 58 storeys are scheduled to be done by June 2010.

"We are very pleased to have reached this important milestone in the development of what will be the largest and most prominent office tower in Canada west of Toronto," said Tom Hofstedter, president and CEO of the H&R REIT, in a news release.

Occupancy to begin in 2011

A phased occupancy with EnCana is anticipated to begin in 2011 with full occupancy in 2012.

"We are confident that our expected $900-million equity investment required for this remarkable project will produce stable and growing returns for our unitholders for many years to come," Hofstedter said.

The Bow complex, located on two blocks of Centre Street and 5th and 6th Avenues S.E., was budgeted to cost about $1.5 billion. The trust had invested about $402 million in the project as of Dec. 31, 2008.

Named after the nearby Bow River and the tower's curving shape, the glass-and-steel building was billed by EnCana's CEO as a symbol of the westward shift of economic power in Canada when plans were unveiled in 2006.