CANADA: EnCana to sell HQ to H&R REIT

A key part of the new project could be the relocation of the National Portrait Gallery from its current home in Ottawa to Calgary, something that has been discussed in the western city for months.

EnCana Corp. is close to signing an agreement to sell and leaseback its soon-to-be-built headquarters in Calgary, a deal that would be one of the largest leases in Canadian history.

Sources say H&R Real Estate Investment Trust, the second largest REIT in the country, is the leading candidate to develop and own the property which at 2.1 million square feet would be the largest of its kind west of Toronto.

The site will include 120,000 square feet of retail space.

"There have been a lot of rumours on this project but it appears to being going ahead and EnCana is now just negotiating alone with H&R," said one industry source based in Calgary. Sources indicate EnCana will sign a 25-year lease on the property in downtown Calgary.