Times building is off the market
With U.S. commercial real estate sales at a near-standstill, Tribune Co. is suspending efforts to sell its namesake tower in Chicago and the downtown Los Angeles headquarters of The Times, the company said Wednesday.
“Given the downturn in the real estate market, a sale is less likely now, but we continue working with our advisors on other ways of maximizing the value of these properties,” Tribune spokesman Gary Weitman said. That might include renting space in Tribune-owned buildings to tenants.
Finding tenants or buyers is a challenge for most commercial property owners now, said Mark Sullivan, regional manager of commercial real estate brokerage Studley Inc.
“There is very little demand on the user side and even less on the buyer-investor side,” said Sullivan, who does not represent Tribune. “For an entity that does not have to sell now, it makes sense to wait for a better time.”
Selling assets, though, has been part of Tribune’s financial strategy since real estate mogul Sam Zell led an $8.2-billon buyout of the company in 2007 and incurred substantial debt in the process.
Some assets including a TV studio in Hollywood and newspaper Newsday, which serves New York’s Long Island, have already been sold, but the international credit crunch has slowed other potential sales of Tribune assets such as the Chicago Cubs baseball team and its Wrigley Field stadium.
Last June, Zell said the longtime homes of the Chicago Tribune and The Times might be sold.
“Both Tribune Tower and Times Mirror Square are iconic structures,” Chief Executive Zell said in a memo to employees. “But they are also underutilized, and as employee-owners, it’s in our best interests to maximize the value of all our assets.”
The former Times Mirror Square, diagonally across from City Hall in Los Angeles, has 750,000 square feet of usable space. It is a collection of five interconnected structures built from the 1930s to the 1970s. Its Civic Center location might make it attractive to government agencies, real estate observers say.
Tribune Tower, completed in 1925, was one of the first Chicago skyscrapers built north of the Chicago River. The neo-Gothic-style building is 40 floors tall with 940,000 square feet of usable space and has an adjacent parcel of land, about an acre in size, that is used as a surface parking lot.
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