Canadian Pacific workers will move to One Financial Plaza.
A key step in the renovation of the Soo Line Building into upscale apartments was consummated Thursday when Canadian Pacific Railway, the historic structure's main tenant, announced plans to move out.
The move won't take the railroad's 400 employees very far -- they'll settle into One Financial Plaza, just around the corner.
The glassy 1960s-vintage office tower at 120 S. 6th St. in downtown Minneapolis will serve as the Calgary-based railway's U.S. headquarters, and will ultimately be renamed Canadian Pacific Plaza.
Canadian Pacific has occupied the Soo Line Building at 501 Marquette Av. S. since it took full control of the Soo in 1990. It had owned a majority stake in the company since the 1890s.
The Soo Line Building, once downtown Minneapolis' tallest office tower, was acquired by Village Green Properties for $11.3 million last year. The Michigan-based developer announced plans to renovate the historic structure into 250 upscale apartments as demand for rental units in downtown Minneapolis skyrocketed.
"The Soo Line Building will always hold a special place in the history of [Canadian Pacific], but the move to the newly retrofitted offices, specifically built to the needs of today's railroad, is a good and timely fit for our U.S. operations," said U.S. Vice President Doug McFarlane.
Between its U.S. headquarters in downtown Minneapolis and workers at operations at its St. Paul yard, Canadian Pacific employs about 1,200 people in the Twin Cities. Canadian Pacific is among several large firms with headquarters in the state's largest city -- others include Target Corp., U.S. Bancorp and countless professional services firms.
Terms of the deal weren't disclosed. However, Canadian Pacific will occupy 80,000 square feet of the 26-story One Financial Plaza, which is also home to the Nilan Johnson Lewis law firm, Clarity Coverdale Fury, a marketing and advertising agency, and the management consulting firm Kurt Salmon Associates.
Competition is fierce for top-notch (also known as Class A) office space like the offices at One Financial Plaza, especially since new development remains on hold in a tough economy, according to a recent report by real estate services firm Cushman & Wakefield/Northmarq. The report says there are 107 office buildings in downtown Minneapolis, with an overall vacancy rate of 18 percent for the final half of 2011. The city's central business district has a workforce of about 160,000 people, according to the Downtown Council.
A spokesman for Minneapolis-based Hempel, which brokered the deal, declined to release One Financial Plaza's vacancy rate.
Canadian Pacific employees will begin moving to their new offices in a few weeks, with completion slated for August.
Janet Moore • 612-673-7752