An Elegant Solution to a Mixed Bag of Requirements
Gannett Co., Inc., had four real estate requirements in four different states.
A $7.8 Million lease in Daytona, Florida, with more than ten years remaining and no need for the space
A 98,742 SF building on 18 acres in Fayetteville, North Carolina
A 646,298 SF building on 13.5 acres in Louisville, Kentucky, which had significant deferred maintenance that would require expenditure of both time and money
A 475,689 SF building on 40 acres in Milwaukee, Wisconsin, which was very attractive to potential buyers and investors.
Gannett also needed to lease back space in two of the locations – a small amount in Louisville and a larger amount in Fayetteville – so that they could continue to print and distribute in the local markets. Gannett tasked BellCornerstone with finding solutions to these various requirements in the second quarter of 2022 and needed a resolution by year end.
The BellCornerstone Approach
BellCornerstone marketed each property individually and collectively as a portfolio offer. The BellCornerstone team reached out to thousands of prospective buyers and investors in the local markets, uncovered multiple interested parties, and obtained full-price offers for two of the locations. With potential solutions at hand for the two largest properties, BellCornerstone turned its attention to the lease obligation in Daytona.
BellCornerstone began its negotiations with Gannett’s landlord in Daytona. As discussions progressed, BellCornerstone suggested that the landlord tour the facilities in Fayetteville, Louisville, and Milwaukee, and consider a potential package deal. Members from the BellCornerstone team travelled to meet the landlord’s representatives at each of the three properties the following week and discussed with them possible scenarios for a deal that included two or more of the requirements. There was great complexity given the significant value and desirability of the Milwaukee location in juxtaposition with the 620,000 SF of vacant space and environmental concerns of the Louisville location. In addition, BellCornerstone was looking to sell Fayetteville at full price while ensuring that Gannett would be released from its $7.8 Million lease obligation in Daytona.
While these high-stakes negotiations were taking place with the landlord, BellCornerstone continued to identify potential buyers and offers which strengthened Gannett’s position and allowed them to negotiate the best possible resolution for each requirement.
In less than nine months, BellCornerstone provided an elegant and profitable solution to a complicated, multi-state bundle of requirements. By having the expertise and negotiating prowess to put all four pieces of the puzzle together, BellCornerstone created a package deal that satisfied both the client and the landlord/buyer. By year end, Gannett was able to sell three large properties for over $41 Million and secure its necessary leaseback space, while simultaneously being released from its $7.8 Million lease obligation.