NY Times sells building to raise cash
Posted by Simon Day on March 10, 2009 at 3:54 PM
The New York Times Company announced Monday that it had sold its headquarters to investment firm W. P. Carey & Company in a sale-leaseback agreement. The deal was used to raise US$225 million in order to pay down long term debts and create financial protection as the newspaper industry continues to suffer, The Times reported.
The lease term is 15 years and there is an option for the Times Company to repurchase the building for $250 million during the 10th year of the lease term. Both parties expect the term will be exercised. The rental payment will be $24 million for the first year and will escalate through the term of the lease.
The lease term is 15 years and there is an option for the Times Company to repurchase the building for $250 million during the 10th year of the lease term. Both parties expect the term will be exercised. The rental payment will be $24 million for the first year and will escalate through the term of the lease.
"W. P. Carey was able to clearly understand our company, our facility and our objectives," said Janet L. Robinson, president and chief executive of the Times Company.
In the midst of the economic and concurrent industry crisis, The Times has made a number of other cash cushioning moves. The company borrowed $250 million from telecommunication guru Carlos Slim Helú, suspended its dividend for the first time in 40 years as a public company and has put its shares of the Boston Red Sox on the market.
At the close of 2008 the Times Company was carrying more than $1 billion in debt. Long-term debt requires the company to make a principal payment of $49.5 million this November and a $250 million payment in March 2010.
In the midst of the economic and concurrent industry crisis, The Times has made a number of other cash cushioning moves. The company borrowed $250 million from telecommunication guru Carlos Slim Helú, suspended its dividend for the first time in 40 years as a public company and has put its shares of the Boston Red Sox on the market.
At the close of 2008 the Times Company was carrying more than $1 billion in debt. Long-term debt requires the company to make a principal payment of $49.5 million this November and a $250 million payment in March 2010.
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