Fire crews were called to the Kelly-Ramsey building in downtown Edmonton just after 3:30 p.m. MT Tuesday. (Lydia Neufeld/CBC) A fire in an 80-year-old building in downtown Edmonton on Tuesday was deliberately set, police said Thursday.

The fire broke out just after 3:30 p.m. at the Kelly-Ramsey building at Rice Howard Way and 101A Avenue. It took firefighters two and a half hours to get the fire under control.

Damage has been estimated at $3.5 million.

An arson investigation is now underway, Edmonton police spokesperson Dean Parthenis told CBC News.

The heritage building houses the offices of Worthington Properties, which also owns the building.

The B.C. government is concerned what effect the fire may have on its efforts to recover costs in relation to a closed pulp and paper mill in Mackenzie, B.C.

Last year, Worthington Properties bought the mill from Pope and Talbot, but in January, the B.C. government stepped in to maintain the facility after the company failed to pay maintenance workers. The government was worried about the possibility that frozen pipes would burst and release chemicals into the environment.

Province hopes to recover costs

After Worthington Properties bought the mill, ownership was turned over to a company called Worthington Mackenzie. The owner of Worthington Properties, Dan White, resigned as director of the company and now the only person listed on the corporate registry of Worthington Mackenzie is someone from Slovenia.

The province hopes to recover costs, but it still needs to clarify the ownership of the plant.

On Wednesday, B.C. Forests Minister Pat Bell expressed concern about the fire.

"We're very concerned about the documents associated particularly with the Mackenzie mill," he said.

"We know a large number of those are still stored in Mackenzie. But certainly, if some of those were lost, there is a potential risk there so we're following this along closely and trying to get in touch with Worthington Properties."

On Wednesday, CBC News contacted Worthington Properties owner and president White in St. Petersburg, Russia. He said his staff had emailed him about the fire.

"Well, personally, I am under so much stress right now that it's a little hard to fathom," he said. "The building itself is … we love the building forever and it's a key component of the city of Edmonton."

When told by a CBC reporter that fire officials were looking at the possibility of arson, White said he agreed it was a possibility.

"It could be. It's obviously arson. I don't imagine that somebody, that it just, you know, self-combusted. It's sad," White said.

"I have no clue. Like I said, I'm over here in Russia, but I can't imagine the building self-combusting. I have no clue. The fire department will figure that out," he said.

The building does not have a heritage designation, but White said he hopes the building can be saved.

"That building must be saved for numerous reasons," he said. "It adds so much character to the city. It'd be an absolute shame if it's destroyed."

With files from Charles Rusnell and Jeff Davies