One of the remaining assets held by some beleaguered newspaper publishers is real estate, in the form of parcels of land and even their office buildings themselves, which can be sold to shore up finances in times of need.
With times looking especially needy, the McClatchy Co. is doing just that: the company has finally sold a 14-acre parcel of waterfront land, including the headquarters of The Miami Herald, to a Malaysian resort developer for $236 million.
Under the terms of the deal, the newspaper will be allowed to continue operating from its current office building for two years, at which time, it must vacate the site and relocate to new headquarters. The resort developer, Genting Malaysia Berhad, has publicized plans for a development called Resorts World Miami, which will include a hotel, convention space, restaurants, retail and residential uses.
McClatchy said it will direct $163 million from the sale to the company's pension plan, with $65 million going to pay down debt and $2 million covering taxes.
The news of the land sale comes amid yet another round of layoffs at McClatchy newspapers around the country. Over the last several months McClatchy has cut over 200 positions, including 76 jobs at the Sacramento Bee; 70 jobs at the Fort Worth Star-Telegram; 25 at the Kansas City Star; 20 at the Raleigh News-Observer, 15 at the Lexington Herald-Leader; and 15 at the Miami Herald, along with 35 positions being left vacant.
While most newspaper publishers are still suffering revenue declines, McClatchy had a particularly rough first quarter, with total revenues down 9.5% to $304 million and ad revenues down 11% to $225 million compared to the same period in 2010.