Economic History, Estonia, Financial Services, Markets and Companies, Real Estate

At the peak of the real estate boom the state-owned defense contractor E-Arsenal put the property it owned in North Tallinn up for auction at a starting price of 50 mln kroons (EUR 3.2 mln). The auction drew several bids, but the company decided to reject them and announce a new auction with the same starting price. The offers submitted to the second auction were rejected as well.

Infortar CEO Ain Hanschmidt told Eesti Paevaleht he was certain that the company's offers, the first one of 64 mln kroons and the second of 80 mln kroons, were the highest bids.

A former member of the supervisory board of E-Arsenal, Eero Elenurm, confirmed to the daily that Infortar had submitted the highest bids in both auctions.

Eerik-Niiles Kross, chairman of the supervisory board of E-Arsenal at the time, told the paper that although the company could have sold the property for 80 mln kroons the plot might have been worth more according to estimates made at that time. He also said that in his opinion the property should have been used to recreate a properly working defense industry company.

According to the 2007 annual report of the Ministry of Defense, the supervisory board of E-Arsenal decided to take a timeout on the sale so as not to give up the property below its estimated real market value in a rush.

It became known in the middle of January that Reform Party politician Rain Rosimannus holds 4.65% of Arsenal Center OU, the company that owns the Arsenal shopping center. Arsenal Center acquired the property for 1.5 miln euros in 2012.