Any taker for newspaper buildings?

Who can be the worst affected entity in this dwindling US commercial property sector? Common buyers or general stakeholders? Well, many may point out the magnates but many are directing their attentions on the giant newspaper companies. Newspapers? This single term may amuse many since newspapers are considered as the pillars of democracy, greatest adherents of freedom of speech and expression and the prime champions of human rights. However, in this age of crony or compadre capitalism newspapers get sold in the markets and their operations continue on the strength of the easy concepts of profit and loss. But even this long held position is no more secured and the news websites are attracting more readers and advertisers. For this simple reason the revenue is plunging and the newspaper companies are trying to sell their buildings to raise money or save on costs.

Isn’t there any other way? Well, according to the newspaper companies, this is the last resort. How is this option working therefore? The option, in opposition, is producing adverse results since frozen credit markets make commercial real estate deals insufficient. The problem, therefore, lies in timing. It would certainly have been better if the newspaper companies had done the same thing a year before or when the market was upbeat. This was expressed by Ross Moore, a director at the real estate services firm Colliers International, categorically, who said, “Timing is everything. If you tried to do a sale-leaseback 18 months ago the deal would have been done before the end of the day. Now, you’ve probably got your work cut out for you.”

On the other hand it is known in the market that the newspaper industry is going through the worst phase in the recent years. For that reason they hardly have choices and the buyers may exploit this situation therefore. The trend has already begun and the companies are getting lesser prices against buildings hence. How far will this help the newspapers to sustain? This is a crucial question but none has the right answer at present.