Denver Newspaper Agency Nearing $88 Million Sale Leaseback of Denver HQ

DenverPost.com - July 18, 2006

The Denver Newspaper Agency is working on a deal to sell the new $88 million joint headquarters of The Denver Post and the Rocky Mountain News and lease it back from the buyer. The agency hopes to announce the deal within about 10 days, just before the newspapers begin moving into the 300,000-square-foot building at Colfax Avenue and Broadway.

"We're not in the real-estate business," said Dan May, senior vice president and chief financial officer of the DNA. "We want to be a more traditional group that leases its downtown real estate."

May declined to identify the investors interested in buying the building. The performance of interest rates has been advantageous, May said. When the DNA financed the building, rates were low. Now, with rates rising, it might make sense for the agency to lock in a lease rate that would make its payments predictable for a long period. If interest rates rise, as many people expect, locking in payments over the long term would be beneficial for the DNA, May said.

In the negotiations, various terms are being discussed. They involve different ways the deal could be structured, including a possible option for the DNA to repurchase the building. Sphere: Related Content