Stockmann to sell its department store properties in Tallinn and Riga and continues with long-term leaseback agreements
STOCKMANN Oyj Abp
Stockmann has today, according to the corporate restructuring programme, sold its department store properties in Tallinn, Estonia and in Riga, Latvia to Viru Keemia Grupp (VKG). The total sales price is approximately EUR 87 million. Stockmann will use the proceeds from the sales of the properties in full to reduce its secured restructuring debts.
Stockmann will continue its department store operations in Tallinn and Riga under long-term leaseback agreements made with the new owner. Leases with Stockmann’s tenants will continue mainly with the current concept.
“We are pleased to have found a stable and reliable Baltic owner for the properties, that wants to develop the properties and our department stores in cooperation with us. Our department stores will continue their operations as normal. Stockmann is a respected company with a strong position among our customers in both countries. The department stores have excellent locations in the city centres of Tallinn and Riga, which facilitated the sale of the properties”, says Jari Latvanen, CEO of Stockmann.
“We are excited to be partnering with Stockmann in the Baltics. Both landmark properties are exceptionally well positioned in the growing capital cities of Estonia and Latvia, and we are looking forward to exploring follow-on investment opportunities to support the core business of Stockmann going forward”, says Sten Pisang, CEO of VKG Invest, the investment arm of VKG.
Stockmann built the Tallinn department store property in 1996 and expanded it from a two-storey to a five-storey department store in 2000, to become the largest department store in the Baltics. The net leased area of the Tallinn department store property is 22 980 square meters. The department store property in Riga was built in 2003 and has a net leased area of 15 965 square meters.
VKG Invest is the independent investment arm of VKG, focusing on standalone financial investments unrelated to group’s core activities and with a primary focus on real estate. Viru Keemia Grupp,is a privately owned Estonian industrial corporation with a history dating back to 1924.
The sales process of the department store property in Helsinki city centre is proceeding as planned.
Jari Latvanen, Stockmann’s CEO, tel. +358 9 121 5606
Irina Bojenko, Viru Keemia Grupp’s Public Relations Manager, tel. +372 523 2700