Sweden’s Samhallsbyggnadsbolaget i Norden AB has entered into exclusive discussions with Brookfield Asset Management to sell its remaining 51% stake in a subsidiary as the troubled landlord seeks to pay off debt.

SBB, as the company is known, started talks to sell the stake in SBB EduCo AB and repay an inter-company loan of 14.5 billion kronor ($1.35 billion) from EduCo to SBB after “having recently received an expression of interest from Brookfield,” the firm said in a statement on Sunday.

SBB is struggling to manage an $8 billion debt pile amid rising interest rates and declining Swedish property values. Bloomberg reported earlier this month that Brookfield, which already owns 49% of EduCo, holder of a portfolio of public-education buildings, has expressed interest in SBB’s portfolio.

“Cash inflow to SBB from a sale of the JV could be material and therefore boost liquidity and significantly reduce refinancing risk, at least in the short to medium term,” Danske Bank A/S credit analyst Marcus Gustavsson said in a note. However, leverage could remain high as the impact would depend on the discount in the transaction, he said.

Read more: SBB Attracts Brookfield Interest in Bid to Rescue Landlord

The firm has become the face of the commercial property crisis in Sweden after it’s credit rating was downgraded to junk status by S&P Global Ratings in May. Since then it has postponed a dividend, ousted its founder Ilija Batljan as chief executive officer and put up the whole firm for sale.

On June 22, Sweden’s Financial Supervisory Authority announced that it’s investigating whether SBB has violated accounting rules when compiling its 2021 accounts. The probe includes the valuation of properties in connection to SBB’s public-education buildings Trygge Barnehager and Laeringsverkstedet portfolios.

SBB and Brookfield aim to enter into a share purchase agreement in July, and SBB would retain the right to re-acquire shares in EduCo in the future, according to the statement.

“The decision to enter exclusive discussions to sell EduCo is a strategically important decision for SBB which enables the creation of additional maneuvering room in these challenging times,“ Leiv Synnes, chief executive officer of SBB, said in the statement. “A sale of EduCo would entail that SBB enhances its liquidity and is able to reduce its indebtedness.”

(Updates with analyst comment in fourth paragraph.)