Downtown Calgary’s First Tower, a 28-storey class-A office highrise which has undergone an extensive renovation and upgrade program in recent years, has been sold to G2S2 Capital Inc., through its affiliate the Armco Group of Companies.

Located at 411 1st St., SE, First Tower is the fourth major downtown Calgary office property which has been acquired by G2S2 and Armco Group during the past two years.

"We are thrilled to welcome First Tower into our portfolio," Steven Darrow, the company’s president of Atlantic Canada and Alberta, said in the announcement. "Calgary continues to be a key market for us, and this acquisition underscores our confidence in the city's long-term economic vitality and the ongoing return to office space.”

The building was acquired from Hines and its partner Oaktree Capital Management, which had in turn bought the tower in 2018. They then embarked on a major investment program to lift the building from a class-B property to its current class-A status. 

“We are pleased that Hines will continue managing the property, and we look forward to working with them to maintain First Tower's exceptional standards and tenant experience," Darrow said in the announcement.

Financial terms of the transaction were not disclosed.

About Calgary's First Tower

Spanning 729,760 square feet across 28 floors, First Tower features 688,106 square feet of office space and 41,654 square feet of retail and amenity space. 

Originally built in 1982, the property underwent a comprehensive redevelopment in 2020, introducing modernized premium amenities and upgraded aesthetics. Many of the amenities are concentrated on the Plus-15 level. These include:

• an upgraded lobby;
• a tenant lounge;
• a state-of-the-art fitness and wellness facility;
• a multi-purpose conference centre; and
• an outdoor terrace with lounge seating and a fireplace.

Strategically located along the Macleod Trail SE, First Tower offers dedicated access in and out of Calgary's downtown core. It is directly connected to the Plus-15 pedestrian network, providing covered access to The Bow, the Delta Hotel and multiple transit routes. 

The building also reflects its owners' commitment to sustainability through LEED v4.1 ARC Gold and WiredScore Gold certifications. 

The acquisition comes at a time when Calgary's downtown office vacnacy remains elevated - at 27.6 per cent according to Colliers Q2 report - but there have been signs of improvement in recent quarters. An extensive program to repurpose and convert older office properties to multiresidential, along with increased demand for office space, are slowly whittling away at the rate.

In Q2, the Colliers report cited almost a quarter million square feet of negative net absorption in the downtown, driven mainly by an increase in sublet space on the market. However, increased leasing activity could offset that in coming quarters.

G2S2 and Armco in Calgary

With the addition of First Tower, the Armco Group of Companies strengthens its foothold in Calgary's commercial market, complementing its holdings at Bow Valley Square, First Canadian Centre and Altius Centre. 

The acquisition reflects G2S2 Capital's “strategic focus on acquiring and optimizing premier commercial assets across North America” the company’s release states.

G2S2 Capital Inc. is a privately held investment firm focused on generating long-term value through a diverse portfolio of real estate, infrastructure and strategic investments. Armco Capital Inc., part of the broader Armco Group of Companies, is a wholly owned subsidiary of G2S2 Capital Inc.

Founded in 1982 by the Armoyan family, Armco Capital Inc. specializes in land development, commercial real estate and strategic investment opportunities.