NB Power sells two Fredericton office buildings to pay down debt, reduce expenses

Two trademark buildings in Fredericton’s downtown have been sold to a Toronto-based company for $39 million.

Both of them were owned by NB Power – sold to help the power utility reduce its debt and operational expenses.

A spokesperson for the Crown corporation said in a statement that a request for proposals had been made last year “which resulted in multiple bids from across Canada.”

They’ll still operate out of one – 515 King Street – under a lease agreement, but will fully vacate the other, 527 King Street.

“Consolidating NB Power’s office space into one building (515 King Steet) and bringing in a national building operator signals a transformational approach to running our business and demonstrates our strategic plan in action — using partnerships to improve our operational performance,” said Dominique Couture, communications specialist with NB Power. “The sale will allow us to make progress towards paying down debt, reducing operating expenses and improving energy efficiency in the building.”

The utility has owned 527 King for 75 years. It was declared a historic property in 2009.

The Toronto company, Forum Asset Management, did not return a request for comment from CTV News Atlantic, but published reports have said the company will either lease it, turn it into a residential property, or “dispose” of it.

Currently, 515 King is the tallest building in the city’s downtown.

“I think it is a sign that they're looking at all possible ways to reduce their expenses and to ensure that they're in good fiscal standing. So it seemed new to me and made me wonder why hadn't we thought about this before?” said New Brunswick Liberal leader Susan Holt.

In his Dec. 14 report, New Brunswick.’s auditor general shared concerns about the utility’s sustainability.

The Crown corporation is over $5 billion in debt, and has huge projects ahead, like refurbishing the Mactaquac Dam.

In a statement, Energy Development Minister Mike Holland said it’s a promising step forward.

“I have been clear, NB Power must get their financial house in order. This sale shows that they are moving in that direction,” he said.

Holt says the utility is in a difficult situation.

“We've got debt that will increase if we keep rates low. We need to see more efficient management. We need to see better production from Point Lepreau. We need to see a lot more than the $50 million in savings that they've proposed because we can't see 10 per cent rate increases every year,” she said.

NB Power declined CTV’s request for an interview.

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