Real estate developers Mainor Ülemiste has signed a purchase agreement for all shares that had belonged to Technopolis Ülemiste, meaning it will once again become the sole developer of the Ülemiste City district, which comprises mostly office developments and is located close to Tallinn Airport.
The company had sold a 51 percent stake in the development when it started, back in 2010, to a Finnish firm.
The transaction will enter into force once permission from the Competition Authority (Konkurentsiamet) has been granted.
The late Ülo Pärnits had previously been the sole owner of Ülemiste City but ceased to be so in 2010 as noted.
In 2010, Mainor Ülemiste and the Finnish stock exchange company Technopolis Plc created a joint venture, Technopolis Ülemiste, 49 percent Estonian-owned, with Technopolis the majority owner at 51 percent.
This meant around a third of the land which subsequently got developed to form the basis of the Ülemiste City came under Technopolis' ownership.
The transaction value is not clear from the notice, however.
What is known is that the new company will acquire almost a fifth of the office real estate, as targeted to that market, in Estonia's capital.
Guido Pärnits, board chair at Mainor Ülemiste and the major shareholder of Ülemiste City, said that he appreciates the opportunity to purchase a company which will enable the effective development of Ülemiste City as a unique, smart business hub.
"Dad divested himself of a significant part of his business during a difficult year, while we are making a long-planned buy-back transaction, also in an economically difficult time," Guido Pärnits said.
"This may seem like a somewhat unexpected step. In any case, he would be happy for us. Difficulties are about becoming stronger and smarter, by overcoming them," he added.
"The deal that my father did with Technopolis in 2010 provided us with more development capacity at the time, and we have gone on to realize these opportunities, with both developers of the city, including Technopolis Ülemiste."
"Even as our stake in Technopolis Ülemiste stood at 49 percent, until today, we have been able to move Ülemiste City forward as a whole, while it is worth noting that Technopolis Ülemiste's equity grew significantly during the intervening years," Guido Pärnits went on.
"Naturally parent company Mainor has played a key role in the conceptual development of the complex, but we cannot underestimate the contribution of Technopolis as a partner. However, in recent years we felt that their development has slowed up, so the desire to sell the company came at the right moment, in my opinion. Looking back at everything we have been able to do in a relatively short space of time, achieving and being successful not only in our own business line but also as a strong and substantial partner for the City of Tallinn and the state of Estonia, it was our firm and strong desire to purchase Technopolis ourselves, and thereby become the largest office real estate developer in the country."
The reunified company holds nearly 30 hectares of land for development in the Ülemiste City, while according to detailed plans, 500,000 square meters of land is still undeveloped.
In 18 years, the Ülemiste City has seen a total of 167,000 square meters of office space, health centers, and residential areas developed.
This includes landscaped open space, parking facilities, and refurbished legacy buildings, as well as substantial new builds.
A new health center, a school and a community building are also under construction.
Developments have cost around €300 million, while the investment portfolio of Technopolis Ülemiste makes up approximately one-third of this total.
Guido Pärnits added that: "There are many plans and opportunities with Ülemiste. The most major challenges lie in cooperation with the city authorities and the state, to develop the Ülemiste traffic hub, located next to the [pending] Rail Baltic terminal, the airport and the Ülemiste Keskus shopping mall. We also want to build a 'European park,' with a landmark high-rise building which will economically empower the region and the whole of Estonia. Along with these developments, tunnels under the rail line are needed to ensure Ülemiste City's accessibility is worthy of local companies and of the region."
Editor: Andrew Whyte