The Russian government has instructed state-owned Russian Railways to sell a landmark skyscraper in central Moscow in an effort to reduce the company’s mounting debt, according to multiple sources familiar with the decision.
Russian Railways, the country’s largest commercial employer with roughly 700,000 staff, was directed to divest the 62-story “Moscow Towers,” a high-profile building within the Moscow City business district. The property was acquired in 2024 for approximately 193 billion roubles, equivalent to about $2.4 billion, and authorities have reportedly mandated that it be sold for no less than its original purchase price.
The sale was discussed during a government meeting last week as officials examined options to stabilize the railway monopoly, which carries an estimated debt load of $50 billion. Falling revenues, combined with sharply higher borrowing costs driven by the highest interest rates in two decades, have intensified financial pressure on the company amid a broader slowdown in Russia’s economy.
Sources indicated that the decision to sell the skyscraper aims to ease debt levels while avoiding steep increases in cargo transportation tariffs, which could further strain businesses and consumers. Russian Railways had initially planned to relocate its headquarters to the tower and finance the acquisition through the sale of other Moscow office properties, a strategy that was never fully implemented.
The government continues to evaluate additional support measures, including potential debt restructuring, state subsidies, temporary tax relief, or delayed tax payments. One option still under consideration involves converting a portion of bank debt into equity, subject to negotiations between Russian Railways, the Finance Ministry, and the Central Bank over a multi-year period, with a buyback mechanism backed by state guarantees.
However, major creditors have shown resistance. The chief executive of VTB, Russian Railways’ largest lender, confirmed that banks rejected a proposal to convert roughly 400 billion roubles of debt into shares.
The Moscow City district, where the tower is located, hosts major corporations, financial institutions, and government offices, making the asset both prominent and potentially difficult to sell in a cooling economic environment. Russia’s economy is forecast to grow by just 1% this year, a sharp deceleration from last year’s expansion, which could complicate efforts to attract buyers.
Russian Railways and government officials have declined to comment publicly on the matter.
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