Struggling Japanese automaker Nissan announced Thursday that it will sell its headquarters building in Yokohama, southwest of Tokyo, for 97 billion yen ($630 million) as part of efforts to strengthen its finances and accelerate modernization.

Under the deal, Nissan will lease back the building and continue to use it as its headquarters, while recording 73.9 billion yen ($480 million) in gains from the sale to Tokyo-based real estate operator MJI Godo Kaisha, the company said in a statement.

The proceeds will be used to upgrade internal systems at its headquarters, including the implementation of AI-driven operations and digital modernization across various departments, Nissan said. The automaker produces models including the March subcompact and Infiniti luxury cars.

MJI Godo is a special purpose trust owned by the Hong Kong-listed Minth Group, a major auto parts manufacturer. The terms of the lease were not disclosed.

Nissan, which is set to release its first-half financial results later Thursday, has been struggling to return to profitability, posting a 670.9 billion yen ($4.4 billion) loss for the fiscal year ending in March.

The company has pledged a turnaround under new CEO Ivan Espinosa, a Mexican executive with two decades of experience at Nissan who assumed the role earlier this year.

“This move reflects a disciplined approach to capital efficiency, unlocking value from non-core assets to support transformation during challenging times,” Nissan said, adding that the strategy is part of its broader efforts to innovate, stay competitive, and invest in future growth.

As part of its restructuring, Nissan is cutting about 15% of its global workforce, roughly 20,000 jobs, and closing its flagship Oppama factory in Japan.

Source: AP