The New York Times reached a sale and leaseback agreement with WP Carey & Co, the investment firm, and two affiliates for part of its stake in the company’s Manhattan headquarters in a long-anticipated deal to raise $225m to help pay off $1.1bn in net debt.
Annual rental payments start at $24m in the first year and will increase in subsequent years.
But analysts said the deal came at a high cost for the newspaper. “[The rent] is expensive, but less so than the Slim deal,” said Ed Atorino, a media analyst at Benchmark.
In January, The Times borrowed $250m from Carlos Slim, the Mexican billionaire, at a steep 14% interest rate, as part of a series of deals to repay its $1.1bn in net debt. The newspaper is considering all available options, including selling its stake in the Boston Red Sox baseball team and potentially the Boston Globe newspaper.