January 10, 2013 / 6:36 AM / 5 years ago

UPDATE 1-Sony puts Tokyo building up for sale in $1.1 bln deal-sources

(Adds details on office market, other asset sales)

By Junko Fujita and Reiji Murai

TOKYO, Jan 10 (Reuters) - Sony Corp has put one of its main buildings in central Tokyo up for sale in a deal that could raise up to 100 billion yen ($1.14 billion) as the company seeks to sell non-core assets to boost its balance sheet, five people with direct knowledge of the deal said.

Sony is trying to sell the 25-storey Sony City Osaki building, in what would likely be the biggest office property deal in more than three years in Japan’s property market, which has been in the doldrums in the wake of the global financial crisis.

The move underscores Sony’s efforts to sell non-core assets to focus on reviving its consumer electronics business. Sony last year sold a chemicals company and is currently considering the sale of its battery business unit, Chief Executive Kazuo Hirai said this week in Las Vegas.

The company is also trimming its headquarters staff by a fifth and is trying to sell its U.S. headquarters, which is expected to fetch up to $800 million. [IDn:nL3E8LJ2RP]

Sony City Osaki was completed in March 2011 after the company renovated a building that produced the Trinitron television set that Sony developed. The site was known as the “holy land” in Japan for television sets.

The 124,000 square-metre building houses 5,000 Sony employees, most of whom are involved in making television sets and audio equipment. The employees will remain at the site as the company will lease back the space from the future owner, one of the people said.

A Sony spokeswoman declined to comment.

Foreign and domestic investment funds have been notified about the sale of the building located near Sony’s headquarters.

A sale would likely be Japan’s biggest office property transaction since two large deals in central Tokyo 2009. More recently real estate asset manager Kenedix Inc last month bought an office building in central Tokyo for 51 billion yen together with state-owned lender Development Bank of Japan and developer Tokyu Land Corp.

$1 = 87.1300 Japanese yen Reporting by Junko Fujita and Reiji Murai; Editing by Matt Driskill and Richard Pullin

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