Sony announced it has sold its US headquarters building, located at 550 Madison Avenue in New York City, to a consortium led by The Chetrit Group. The company will fetch $1.1 billion for the building and anticipates to add about $685 million in operating income after settling its debts on the property. Sony's operations will remain in the building for up to three years under a leaseback deal with the new owner.
Sony Corporation of America ("SCA"), a wholly-owned subsidiary of Sony Corporation ("Sony"), today announced that it has entered into a contract to sell its U.S. headquarters building, located at 550 Madison Avenue in New York City, to a consortium led by The Chetrit Group, a New York-based owner of commercial properties in New York City and other major US real estate markets.
The sale price is $1.1 billion, and it is expected that the transaction will close in March 2013. SCA and other Sony businesses (including Sony Music Entertainment, Sony/ATV Music Publishing and Sony Pictures Entertainment, among others) will remain in the building for up to three years under a leaseback arrangement with the purchaser.
After repaying debt related to the building and other transaction costs, it is expected that Sony will receive net cash proceeds of approximately $770 million. Sony expects to realize a gain on the sale of approximately $685 million to be recorded as operating income.
Sony is currently reevaluating its forecast of the consolidated financial results for the current fiscal year ending March 31, 2013 to take into account this sale and other factors that might affect such forecast.