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Nokia sells its HQ building and leases it back

Embattled smart phone vendor Nokia will get more than $200 million in much needed cash by selling its impressive headquarters building in Espoo, Finland, and leasing it back.

The buy and lease back option is a favoured tactic of organisations that are asset rich but cash poor. They get the cash up front and then pay rent – it’s a bit like a loan, except you end up with nothing. The complex was sold to Exilion Capital, and large Finnish property developer and owner of a large software company of the same name, for €170 million ($213 million).

Nokia had occupied the building in Espoo, near Helsinki, for eleven years. It is a large 50,000 m2 building built in the modern Scandinavian style with hardwood floors and impressive public areas. It was built in multiple stages, with its various wings connected by glass enclosed bridges. Over1800 Nokia staff work there, though there is room for many more after staff cuts in recent years.

"We had a comprehensive sales process with both Finnish and foreign investors and we are very pleased with this outcome,” said Nokia CFO Timo Ihamuotila.”Owning real estate is not part of Nokia's core business and when good opportunities arise we are willing to exit these types of non-core assets. We are naturally continuing to operate in our head office building on a long-term basis."

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Graeme Philipson

Graeme Philipson is senior associate editor at iTWire and editor of sister publication CommsWire. He is also founder and Research Director of Connection Research, a market research and analysis firm specialising in the convergence of sustainable, digital and environmental technologies. He has been in the high tech industry for more than 30 years, most of that time as a market researcher, analyst and journalist. He was founding editor of MIS magazine, and is a former editor of Computerworld Australia. He was a research director for Gartner Asia Pacific and research manager for the Yankee Group Australia. He was a long time IT columnist in The Age and The Sydney Morning Herald, and is a recipient of the Kester Award for lifetime achievement in IT journalism.