The Deseret News sold downtown property to a real-estate arm of The Church of Jesus Christ of Latter-day Saints on Friday, earning money that will be used for severances of 35 newspaper employees who are going to be laid off in coming weeks.
The property is located on Regent Street and Main Street between 100 South and 200 South. The newspaper made a little more than $3 million on the sale, News publisher Jim Wall said.
The buildings included are the former Newspaper Agency Corp. printing-press buildings on Regent Street, NAC offices located in what has been traditionally called the "Mr. Mac Building" at 135 S. Main, and the NAC "Drivers Lounge" near Regent Street and 200 South.
The News sold the property to Suburban Land Reserve, part of Property Reserve Inc., the LDS Church's real-estate arm that is developing the mixed-use City Creek Center.
"We're going to use a good deal of the proceeds to help our employee severance package," Wall said.
On Wednesday, the News Board of Directors approved the cutting of up to 35 employees to reduce costs. News Editor Joe Cannon, in announcing the cuts to staff Thursday, said revenue has decreased by 32 percent, mostly due to decreased classified-advertising sales.
The employees who volunteer to leave or who are laid off will get three weeks of salary plus 1 1/2 weeks of salary for each year of service, and any remaining vacation time they have accrued.
The LDS Church has not publicly announced what it plans to do with the Regent Street property, which has been identified by a committee of city and business leaders as a potential Broadway-style theater. If the property does not become a Broadway-style theater, a study for the Downtown Alliance recommended the property as a site for a possible black-box theater.
Spokesmen for Suburban Land Reserve and the LDS Church declined to comment Friday on whether the church will develop the property, develop it in conjunction with a development partner or sell it to a developer.
Tom King of Suburban Land Reserve would not comment on the deal. He said he would send the Deseret News' questions to LDS Church public-relations professionals, but they never called the newspaper for the story. The News tried a handful of other LDS Church real-estate and public-relations officials, but they were either unable to comment or did not return calls.
The News had partially owned the Regent Street and Main Street properties for decades, in partnership with the Salt Lake Tribune. In November of last year, the News obtained all of the property in a real-estate and cash swap with the Tribune. As part of the deal, the Tribune obtained property on Gale Street, about 9 acres on 340 West between 500 South and 600 South. The Gale Street property also consisted of buildings for a printing press and mailroom.
"We traded our interest in Gale Street for their interest in Regent Street," Wall said.
The Gale Street property, too, has been sold, although Tribune Editor Nancy Conway relayed through an assistant that she did not have enough information on the sale to comment for the story Friday. Dean Singleton, head of MediaNews Group Inc., the newspaper chain which owns the Tribune, was in Europe and unavailable to comment.
The News and Tribune have printing facilities in West Valley City and no longer use the Regent Street and Gale Street properties. The Regent Street property was worth between $3 million and $3.5 million, Wall said, and the Gale Street property was worth $7 million. The Tribune gave the News money to equalize the property swap.
The appraisal for the Regent Street property did not include demolition costs and hazardous waste cleanup.
The LDS Church gave the Deseret News a "fair market price" for the property, Wall said. The Deseret News is owned by the LDS Church, and selling the property to a nonprofit entity of the church was the "appropriate" option for the newspaper.
The newspaper's management was not interested in demolishing the property and building a theater."We're not developers," Wall said. "We don't do that. It's something we don't have competence in."