What Kind of Price Is the New York Times Getting for Its HQ?
The New York Times is close to a deal to sell/borrow against its Manhattan headquarters reports… The New York Times.
Good to hear: Even after the $250 million deal it struck with Carlos Slim, the Times still needs more cash in the short term. (The long term is a whole other story).
The deal, with W. P. Carey & Company, has yet to close, and the Times isn’t talking about the details, including the most crucial one: What kind of price is the Times getting for its portion of the Renzo Piano-designed building?
At one point, the Times thought the property was worth $850 million to $1 billion. But that was several collapsed banks ago–and bear in mind that it just had to agree to pay Slim 14 percent on his loan. So what kind of deal can it get for its real estate now?
Here’s one way to tell, via a clever MediaMemo reader: Check the stock price of Forest City Enterprises Inc. (FCE-A), the real estate developer that owns the rest of the building the Times is selling. The logic: If the New York Times Company (NYT) is forced to let go of its real estate at fire sale prices, it will devalue Forest City’s property, too.
One thing to look at might be where Forest City trades, since they’re theoretically impacted by the pricing. Granted, they’re a real estate company and so don’t have to mark real estate assets to market unless they’re held for sale (real estate is an operating asset for a real estate company), but the stock market will make some bets on the implications. If FCEA is up in a down market or vice versa, that’ll tell something.”
Interesting. So, for what it’s worth: As I type this, Forest City is up about six percent; the Dow is down 1.5 percent. Maybe the Times got some bang for its buck here after all.