Newspapers shed buildings to raise revenue
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From Ivory Tower of Truth to playground for high rollers: Bart Blatstein's purchase of the Inquirer Building for a casino-hotel-shopping-entertainment complex is one of the more recent examples of a trend that's sweeping the newspaper industry. Photo by the author.[/caption]
These are far from the happiest of times for the newspaper business. Just ask anyone working on the third floor of the former Strawbridge & Clothier store
at 8th and Market streets.
The staff of The Philadelphia Inquirer
and Philadelphia Daily News,
long leaders in their field with a proud history backing them up, have of late been on the cutting edge of another trend: worrying about their futures. As their employer, Philadelphia Newspapers Inc. owner Interstate General Media, continues to seek ways to shore up the paper's flagging bottom line, they have gotten word from the owner that they may not have a future at all
unless more wage and benefit concessions are forthcoming.
This comes not long after Interstate General Media shed one huge asset to raise revenue: the papers' iconic headquarters at Broad and Callowhill streets, their home from 1925 until this past summer. Developer Bart Blatstein, who has designs on North Broad Street even more ambitious than the ones he had on Northern Liberties, scooped up the property and plans to make it the centerpiece of his proposed casino-hotel-shopping-entertainment complex, The Provence
And here as elsewhere, the owners of the Inquirer
and Daily News
were merely at the forefront of an industry trend. Unable to convince enough advertisers or readers that their product continues to have real value worth paying for, newspaper publishers have turned to a more solid source of revenue: their real estate. A recent Bloomberg News report
chronicled the growing parade of newspapers eager to capitalize on rising real estate values by turning their newsrooms into condos, shops and leasable office space.
Some properties, like The Miami Herald's
Modernist bayfront home, are slated to be razed when the sale closes; as with the Inquirer,
plans call for the former Herald
property to become a casino. Others, like the homes of the Des Moines Register
and Providence Journal
, will likely be put to new uses. And some companies may follow the lead of The New York Times,
which sold its recently constructed Midtown Manhattan office building off Times Square and leased it back from its new owner, saving operating costs in the process; Des Moines Register
owner Gannett Co., which has sold more than 2 million square feet of office space since 2005, may consider this option for its Tysons Corner, Va., headquarters.
The moves are no-brainers for the newspapers, who can at once capitalize on rising property values in central cities and slash expenses by taking cheaper space on the urban fringe. Or, in the case of the Inquirer
and Daily News,
in an underutilized property in the middle of it all.
Condos Replace Newsrooms as U.S. Papers Sell Real Estate