The Finnish retailer Stockmann will sell the flagship department store property in the center of Helsinki to the pension company Keva for EUR 400 million, the company announced on Monday.
Stockmann plans to continue its operations in the downtown store, at which time Keva paid approximately EUR 391 million at the time of the transaction and the balance will be taken into account as rent in the next few years.
The transaction is part of the reseller’s previously announced restructuring plans, in which Stockmann aims to use the proceeds from the sale for more than EUR 342 million in debt and other unsecured restructuring debt for approximately EUR 21 million.
"We are delighted to have found a stable and reliable domestic owner for the property. The department store building in the center of Helsinki is iconic and in an excellent location, which made it easier to sell the property," Jari LatvanenStockmann’s CEO said in a statement.
The Stockmann property in the heart of Helsinki has been designed by Sigurd Frosterus and was completed in 1930. The brick building has a total leasable area of approximately 51,500 square feet, the company said.
Stockmann 160 years
According to Latvanen, the change in ownership of the property should not be visible to the customer at all, adding that according to the terms of the agreement, Stockmann’s operations cannot be terminated on site, even if Keva so wishes.
"If both parties comply with the conditions, there is no such problem," Latvanen said.
The CEO added that he thinks the future of stone-footed houses is brighter now that the Covid crisis is easing, saying consumers want options and services that are not available in online environments.
"Customers want to return to the department stores. They want social contacts. This deal is well suited for Stockmann’s 160th anniversary. Let’s see what the next 160 years will bring when it comes." Latvanen said.
The department store chain was founded in 1862, but like many retailers of its kind, it has been in trouble in recent years. Then the spreading effects of the coronavirus pandemic prompted the company to apply for corporate restructuring in the Helsinki District Court last spring.
Stockmann’s share prices on the Helsinki Stock Exchange rose by 11 per cent on Monday at 11 am.
Source: The Nordic Page