Times Mirror Square for Sale, But Who Would Want It?

DOWNTOWN LOS ANGELES — The news this morning is that new Tribune boss Sam Zell is putting out RFPs for the sale of Tribune Tower in Chicago and Times Mirror Square here. LA Observed has the full Zell memo.

The real question, though, is just who might be interested in buying Times Mirror Square given its location and restrictions.

The memo reads:

…We are in the process of asking a number of real estate firms to give us their best thinking on how we can generate more value from Tribune Tower in Chicago, and the Times Mirror Square complex in Los Angeles.

We’ll be considering numerous options to maximize the value of these properties. While a near-term transaction is possible, we’ll be focusing on opportunities that allow for some level of ongoing occupancy in both buildings for the mid-term (defined as five years), for farther out (15 years), and beyond.

Most importantly, we are not rushing this process, and I can assure you we will not accept anything but full market value for these assets. As we made clear on our first quarter earnings call, Tribune has sufficient liquidity to satisfy our principal amortization requirements through 2008, due to the proceeds we will realize from the Newsday transaction, and from our plans to create an asset-backed commercial paper program.

Our request for proposals, which is being issued today, is likely to generate media attention and debate about what we should or should not do with the properties. Both Tribune Tower and Times Mirror Square are iconic structures, deeply intertwined with the history of this company. But, they are also both under-utilized, and as employee-owners, it’s in our best interests to maximize the value of all our assets.

The Times has thought about moving out of its historic headquarters before. This 1994 Los Angeles Business Journal piece talks of a decided-against move, but gives no ink to what might become of the Times’ complex. A 1993 story in the New York Times gave similar mention to sale and move, but again no talk of interest in the property.

Though Downtown’s Civic Center has several hundred thousand government employees, but the amount of open or under-utilized land nearby would lead one to believe that there is no clamor for adjacent office space. Law firms would be the most likely candidates, given the location of the courts, but most are quite happy in Downtown’s more premier buildings. To attract such firms to the Times Mirror complex would inevitably require serious upgrades and the building to find a certain cachet for its tenants.

ALSO:

• Mark Lacter at LA Biz Observed similarly asks who would buy, and includes a link to blogdowntown.
• Cara DiMassa spoke to Tom Gilmore, who called the property “virtually worthless as a piece of real estate”.