In the shadow of the Peace Tower, it is one of the most coveted pieces of real estate in Canada.

Now CBC News has learned the former site of the United States embassy, closed for nearly two decades, will become a space dedicated to Inuit, Métis and First Nations communities.

A government source says that officials have not determined the exact use for the federal heritage building considered by many to be an architectural gem in the city. 

Government officials will make a formal announcement about the building later in June and launch consultations with Indigenous communities to help decide on a specific purpose​.

Under Jean Chrétien, the building was slated to become a portrait gallery, but that plan was shelved when Stephen Harper came into power.

The decision by Justin Trudeau's government to dedicate the facility to Inuit, Métis and First Nations people is undoubtedly a political statement.

Trudeau has committed to building a new relationship with Indigenous people, though there have been struggles to fulfil some of his commitments, including the delays plaguing the inquiry into missing and murdered Indigenous women and girls.

Not the 1st choice in survey

Although there were public consultations about the use of this site, using it to recognize Inuit, Métis and First Nations was not the most popular choice.

A survey conducted for the government by Ekos Research Associates suggested that a "Canada House" to showcase the best of the provinces and territories was the favoured choice for the building. A gallery was the second choice, with an Indigenous cultural facility coming in third.

Dedicating a building that is just across the street from Parliament and the Prime Minister's Office to Indigenous communities is doubtless intended to send a symbolic message.

The future of the project will fall under the auspices of Indigenous and Northern Affairs as well as Public Services and Procurement Canada, which is responsible for the Parliamentary Precinct.

There was no word on the timeline for the new facility.

The government source says this decision for the property at 100 Wellington Street does not rule out the possibility of establishing a portrait gallery elsewhere at some other time.