NY Times In Building Sale Talks with WP Carey

NEW YORK (Reuters) – The New York Times Co (NYT.N) is in advanced talks to sell a large portion of its headquarters building in midtown Manhattan to W. P. Carey & Co (WPC.N) in a deal that would allow the company to buy back the space, the newspaper said on its website on Thursday.

The Times, among the world’s most famous newspaper publishers, has been struggling to fix its financial difficulties amid a sharp drop in advertising revenue.

The newspaper company confirmed the “sale-leaseback” deal to the Times, but it said spokeswoman Catherine Mathis would not disclose the transaction’s value. In sale-leaseback deals, a company sells an asset and then leases it back from the buyer.

According to the Times, the company will sell W. P. Carey the 19 floors it uses in the 52-story building and at the end of a 10-year lease has the option to buy them back. The Times will continue to occupy the floors, it said.

The newspaper will not sell the six floors it leases to other tenants, according to the report.

The company announced last month it was looking to do the sale-leaseback deal, which it said could bring in up to $225 million. It did not name a partner in the deal at that time.

The Times owns 58 percent of the tower, the newspaper reported, with developer Forest City Ratner owning the rest. The building was completed in 2007.

Earlier this month, the company agreed to a pricey $250 million loan from Mexican billionaire Carlos Slim giving the Times extra time to sell assets and improve its business.

The Times could not be immediately reached for comment.

(Reporting by Michael Erman, Editing by Ian Geoghegan)