LYNN — The City finalized a deal on Thursday to purchase the Eastern Bank operation headquarters at 195 Market St.

Eastern Bank will remain in the building as a tenant with a reduced footprint for one year. The rest of the five-story building will be used by Lynn Public Schools for a variety of purposes, such as relocating the administrative offices from Bennett Street and the Frederick Douglass Collegiate Academy and Early College program from North Shore Community College.

“This presents a unique opportunity to use this building for educational purposes,” said Mayor Jared C. Nicholson. “Addressing overcrowding in our schools remains a priority and acquiring this building serves that purpose.”

Nicholson said the City may also use some of the space for workforce development programs.

City Council approved a bond order for $12 million for the City to purchase the building this past June.

The annual debt service on the bond is approximately $670,000, which is estimated to be no more than what LPS is currently paying to lease other spaces for educational purposes. Since lease payments do not count toward net school spending, they will become city expenses after three years and the purchase of the property will have no impact on the city’s budget.

The city issued a request for proposal for office space last spring. Eastern Bank submitted the only response to the proposal.

A public hearing for the bond authorization took place on May 28 and the City Council approved it on June 11.

“We are delighted to have the opportunity to continue our long partnership with and investment in the City of Lynn towards supporting its continued revitalization and economic development,” said Bob Rivers, Executive Chair and Chair of the Board of Directors of Eastern Bank.