It seems like only yesterday that New York condemned a city block in Manhattan, at 43rd Street and 8th Avenue, for a new New York Times building. It was supposed to help revitalize the Times Square area, and yadda, yadda, yadda — the usual stuff. It’s now a couple of years later, and we learn that things haven’t quite worked out as expected. The New York Times is strapped for money and has just sold its interest in that new building, retaining the area it occupies as a tenant with an option to repurchase it. See Russell Adams, New York Times Does Sale-Leasback Deal, Wall St. Jour., 3/10/09, at p. B6.
We also learn from that article that the Times sold its old building for $175 million, and the buyer resold it later for three times that amount. Who knew, says the Times, that a short-lived boom in Manhattan real estate was coming. The Times’ partner in the new venture, Forest City Ratner, is having problems of its own and just took out a $640 million mortgage against its portion of that new building.
The moral of this story: as we never tire of reminding our readers, urban renewal, no matter how semantically disguised, is nothing more than a real estate venture that runs the risk of failure when times turn bad, or even when they don’t, for other rasons. We don’t want to rejoice in the Times’ misfortune, but it can’t go without noting that there is a strand of poetic justice here. When the Supreme Court decided the wretched Kelo case in 2005, the Times was one of only two major national newspapers (the other was the Washington Post) that cheered the court’s decision on its editorial page. Well guys, turnabout is fair play, and he who would live by the sword runs the risk that the sword will turn into a wet noodle when the economy turns. Business involves risk, and calling it by another name does not make it any less risky.