Recruit Co., a major information service company, has sold its office building in front of JR Kawasaki Station to two U.S real estate firms as part of efforts to reduce its huge debts, informed sources said Monday.
Although details of the deal were not made available, the Kawasaki Technopia building is estimated to have been sold for about 10 billion yen to the California-based Kennedy-Wilson group and Colony Capital Inc., the sources said.
The building, completed in 1988 at the height of the asset-inflated economic bubble, was at the center of a bribery case involving then-Kawasaki Deputy Mayor Hideki Komatsu that later developed into the larger Recruit stock-for-favors scandal.
Although the building is a profitable property equipped with up-to-date features, Recruit decided to sell it to help reduce its debts by some 900 billion yen, the sources said. The deal involved a Japanese trust bank, which set up a real estate trust based on the building and sold all the beneficiary rights to the trust to the two U.S. companies.
In the bribery case that broke in the late 1980s, Komatsu was found to have received prefloatation shares of Recruit’s real estate subsidiary, Recruit Cosmos Co., in return for helping the firm attain permission to construct the Kawasaki building in question.
The deputy mayor was dismissed, but the story did not stop there. It was later disclosed that a number of senior lawmakers of the Liberal Democratic Party and part of the opposition camp had similarly received prefloatation shares in Recruit Cosmos that were certain to bring hefty gains after the listing of the firm on the stock exchange.