New York paper signs 15-year lease
NEW YORK — Less than two years after opening its sleek, Renzo Piano-designed headquarters in Gotham, the New York Times Co. has sold it to raise cash.
The $225 million sale will not result in a move, as the company also signed a 15-year lease on 21 floors in the 52-story structure. Rent for the 750,000 square feet of space is $24 million for the first year. It will escalate each year from there, with a buyback option in the 10th year.
The Times owned 58% of the building, developer Forest City Ratner the rest.
The company indicated in December that the building could be exploited as it seeks to stay on top of its debt obligations. Several hundred million in debt is coming due over the next two years just as newspapers as a business are faltering badly.
The company got a $250 million influx from Mexican billionaire Carlos Slim last year, promising a hefty 14% interest rate on the repayment. It also suspended its dividend to shareholders while pursuing a range of strategic options.
Tough times for the newspaper biz could make the company’s 18 papers difficult to leverage. More appealing assets would include an 18% stake in the Boston Red Sox and 80% of the New England Sports Network.
Times Co. shares, which have dipped to multiyear lows in recent months, closed Monday at $3.90, down 4%. They had spiked initially on word of the building sale.