Sony sells office building for $1.2 billion
By
Eddie Makuch, News Editor
PlayStation maker sells second major office this year; employees will remain in Tokyo building for five years.
Sony has sold another major office building. The PlayStation maker today announced it had sold its City Osaki office in Tokyo for ¥111.1 billion ($1.2 billion) to Nippon Building Fund Inc. and a Japanese institutional investor.
After deducting transaction cost expenses, Sony received ¥110 billion ($1.19 billion). As part of the deal, Sony and other Sony Group businesses will remain in the building for five years.
As a result of the sale, Sony said it expects to gain ¥41 billion ($445 million) in operating income to be recorded for the company's fourth quarter ending March 31. Sony conducted this sale as part of a wider initiative aimed at strengthening its corporate structure and returning to a profit.
Sony last month sold its New York City headquarters for $1.1 billion. Employees will remain in that 37-story Madison Ave. building for a period of up to three years.
By
Eddie Makuch, News Editor
Eddie Makuch (Mack-ooh) is a News Editor at GameSpot. He works out of the company's Boston office in Somerville, Mass., and loves extra chunky peanut butter.
88 comments
PS3 software sales didn't help Sony much this gen. Selling off buildings is usually a last resort.
Not necessarily. Real estate, especially huge multi-story office buildings setting on prime property, can be expensive to upkeep. Between taxes, keeping up with building codes and maintenance you're looking at a lot of coin and headache. Why not sell it then rent the space? Let someone else deal with the expense and headaches while still getting the benefit of the building.
1 Like And people say the housing market is bad. If Sony can sell a building for a billion bucks surely someone will buy your two-bedroom ranch house.
@Gooper_Blooper I just bought one lol first house, Yay me!
Oh also as a economist the housing market is starting to turn around even with Obama's hit to financing programs at the end of last year expect to see a rise over the next few years.
Here's a pic of it...http://www.polygon.com/2013/2/28/4039900/sony-sells-sony-city-osaki-office
1 Like $1.2 Billion with a 'B' that must have been one hell of a massive building,and am very dissapointed GS i was expecting the image of the damn bulding
@steelmouth Well its in Manhattan, there is no more land in Manhattan so they just build upwards, and because they're is no land to build in Manhattan all the land is inflated astronomically!
@chingchow48 @steelmouth This is the Tokyo office building they sold... While they did indeed sell their US offices earlier in the year.
Your point still stands.
@RikusTwilight @chingchow48 @steelmouth So it is my bad, I read an article on here a few weeks ago saying they were going to sell there Manhattan office and assumed it was the same one, that is my bad.
5 Like The two most expensive cities in the world; New York and Tokyo. Real estate is very expensive in both. Sell both buildings. Relieve yourself of the taxes and maintenance on both buildings, and you lease the office space from the new owner, and you save a bundle in the process.
@CaptainHerlock Sorry dude Tokyo is the most expensive city in the world but NY is not.
http://newsfeed.time.com/2013/02/06/and-the-worlds-10-most-expensive-cities-of-2013-are/
@CaptainHerlock This is a different time and a different age of industry especially for video games. You do not need:
Skyscrapers to run a business like consoles and video games. Impossible commutes and living within an hour commute is uncommon. Old corporate thinking, wishing back for the 80's era of giant glass buildings looking down from the perch of corporate success. Now you can run a business in a basement near some parks, schools, and comfortable houses with short commutes.
And Sony's manufacturing plants are all in different countries with small offices running them there.
I think they should open a corporate office business park in somewhere like OHIO, or Kansas. A 20 acre business park with simple but modern buildings and an advanced communication system. They would have access to nearby airports, superfast internet, nice schools, close housing suburbs, universities, low taxes, and be centered in the heart of the regions western developers who seem to be pushing the gaming industry forward.
They could have daycares, bike trails, parks, gyms, open court restaurants and movies, all without the billion dollar price tags per square feet. While wining and dining developers. CEO's, and corporate bigshots in fine cities like Tokyo, New york will be missed I am sure they will enjoy shopping at the local outlet malls, dining at the roadkill bar B Q pit, and enjoying heartland entertainment at its finest watching some ladies dance with c-section scars and cigarette burns at the local strip bar.
1 Like @jenovaschilld
Ohio and Kansas? That is the STUPIDEST idea I've ever seen. These are multinational corporations, not some 19 year old gamer geek who believes "this is different because it's video games", whose building an app in his basement. Ever wonder why the Midwest is called "the fly over states"?
@jenovaschilld @CaptainHerlock
Further more, New York has all of those things you mentioned. Many workers live in Connecticut and New Jersey or upstate and commute into the city. So you don't have to live in The Bronx or in Jackson Heights.
@jenovaschilld @CaptainHerlock
And once again a "gamer" who honestly believes that the industry is "different because it's video games". It clearly sounds like you've NEVER been to New York, or even outside of your home state. If you do business anywhere in the world, you need a presence in New York. Not Colombus, Ohio. Not Kansas City where the town shuts down at 6pm. Not Arkansas where people look at you cross eyed if you drive a BMW. As Dave Attell once said "anyone ever been to Dayton, Ohio? You know what's a fun thing to do there? Pack up and get the f$%^ out of there, it's boring". You also realize that Sony does other things BESIDES video games, don't you? Film, music, music publishing, television, etc. And we all know how many television programs are filmed in Bummel Horse, Utah. But of course "this is different because it's video games", isn't it? There's a lot of business you have to do in person, and not online despite the gamer logic belief that nothing has to be in the same room. And there's more perks to being in New York than there are being in Kansas.
Spend some time in New York, and then come talk to me.
@CaptainHerlock Okay I understand your point, but let us debate where else would be a good place to run a console making company who's factories are in small underdeveloped areas. And why. I gave my reasons above.
Great infrastructure with multiple nearby airports, large power infrastructure with relatively cheap business electricity, superfast internet- google's 1g in Kansas and windstream sp? in OH, lower taxes, and in the heart of America which has some of the largest growing western developers in the world. Who argueably is pushing out the newest and most advanced games. Access to nearby mutliple universaties for growing talent and R&D. Comfortable and cheap living areas for employees with much easier access to schools, parks, etc.
It is not like sony or MS makes the consoles right there in their offices and ships them to your home. They use cheap labor in taiwan, china, portugal. Corporate accounting, banking, stock trading can all be done online - I mean google is based in mountainview, CA, Walmart somewhere in Arkansa, UPS in some small area around Atlanta, GA, ebay in san jose, CA. And all of them have satellite offices in remote areas. Even microsoft is in redmond, WA- not much bigger then Kansas city- pop 1/2 million. Or columbus ohio pop close to a million. What resources do you really need to run a console development and distribution that requires multimillion offices in megacities?
Where do you think they should open a corporate office? Captain.
IN OTHER NEWS: Sony sells the coffee pot machines that weren't needed in the old office building anymore.......................
IN OTHER NEWS: Many roaches moved into Sony's old office building................................
9 Like Corporate restructuring is essential, while we enjoy Sony's games we must note it is a profit making entity with the objective of creating shareholder's wealth. Hope these moves strengthen Sony and maintain it's going concern for the foreseeable future.
1 Like In my opinion, the Sony needs more money to put big money into the shared stock on sale because they sold that building for more than one billion dollars. I am not sure about it. :)
10 Like It's amazing how so many people here understand so much about business and yet here they are commenting on a gaming news website instead of using all that knowledge to get rich.
@user_pt come on dude as busy as I am "using the knowledge" I learned in college and otherwise "to get rich" I still take at least one day a week to take my time to do absolutely nothing.
Back on topic at least Sony is starting to see the writing on the wall unlike Ford who spotted the writing and made preparations much sooner.
Better late than never I suppose but the PS3 is where I stop even though Sony seems to be using the PS4 to bridge the gap between PC and consoles while making it much easier for developers to create games most 2008 PC gaming rigs are much more powerful and versatile than the PS4 will be for making and playing games.
Going harsh for that money, they have been losing a lot lately and maybe they are not confident enough about the PS4.
1 Like A while back Nintendo had to move Retro Studio's to a bigger building. Yet Nintendo is being classified as doom...
@Nintyfan95 just how long ago was "a while back"? MS, Sony, Nintendo have all been losing money. While most people are on the Nintendo doom train just to be on it there still are some good reasons that Nintendo will not do as good this gaming gen as they did with the Wii fluke.
Bad marketing of the Wii U in the US and the serious lack of (waning...) third party game support (a repeat of the major problem with the Wii's shovelware...) are good reasons for everyone to stay tuned.
Even if they sold the money for that amount, they still have to spend it on the building rental of the building they just sold!
Microsoft entered 2002 xbox mission objective stop Sony!
FOR Sony doesn´t make Sony windows and Kill Microsoft!
Now! look Sony gonna disappear and become a totally new japanese company!.
4 Like Talk about desperate to turn a profit. PS4 really IS shit or bust for them it seems.
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