CN sells headquarters, buys a U.S. railway
MONTREAL – Homburg Invest of Halifax, Nova Scotia is acquiring the Central Station Complex (CSC) in Montreal from Montreal-based rail conglomerate Canadian National (CN) for $355 million. The transaction, which will include a government agreement to protect the heritage features of Central Station, will be completed by the new year.
The CSC includes CN’s 17-storey office headquarters building and the Central Station railway passenger facilities, which CN will lease back from Homburg Invest on a long-term basis. Central Station includes the Grand Hall, train platforms and portions of the sub-track level.
“We are very excited about building a lasting relationship with CN as our anchor tenant. The station is a landmark in downtown Montreal and we are committed to protecting its heritage features. We also see an opportunity to turn this property into a Montreal icon with the potential development of one million square feet for the site,” commented Richard Homburg, chairman and CEO of Homburg Invest.
In related news, CN has acquired the Elgin, Joliet and Eastern Railway Company, a small Chicago railway which operates almost 300 kilometres of mainline track around Chicago, for US$300 million. EJ&E was owned by US Steel’s Transtar subsidiary. CN will spend US$100 million to upgrade and expand the capacity of the EJ&E railway.
CN operates in 16 U.S. states and earns 77 per cent of its revenue from its U.S. operations, Canada/U.S. transborder operations, and offshore traffic. About 23 per cent comes from its Canadian domestic operations.
For more information www.cn.ca, www.homburg.com.