The Miami Herald will be replaced by a casino repot.
A $3 billion Downtown Miami resort will be built on Miami Herald land by
Genting Group, one of the world's largest international casino developers, .
Genting, the Malaysian developer bought 140 acres of Biscayne Bay-fronting land on May 27 from The McClatchy Co. (NYSE: MNI) for $236 million or about $1.69 million per acre.
The Miami site has 800 feet of waterfront along Biscayne Bay.
That was one of the highest prices for commercial dirt in South Florida in the last decade, according to brokers who track land transactions.
The deal took two months to put together.
The Florida Legislature has still not approved the operation of full-based casinos in the state despite millions of dollars spent by casino-hired lobbyists to change the law over the last 10 years.
"Everybody is posturing and planning and hoping the Legislature will make a decision to make destination resorts a reality" and Genting's deal just "upped the ante,'' he said.
The Miami Herald Media Co.'s newspaper, The Miami Herald, sits on 14 acres of the acquired 140-acre site. The Herald has two years to find another publishing venue, according to a May 27 news release from McClatchy.
The land's owner of record is a Genting subsidiary, Bayfront 2011 Property LLC. The Herald's building is part of the sale.
Genting and its affiliates are leading developers and operators of destination resorts around the world, including the United States, Malaysia, Manila, Singapore and the United Kingdom.
In his prepared statement, Gary Pruitt, McClatchy's chairman and chief executive, said, "This property, located on Biscayne Bay, has been home to The Miami Herald for many years. While locating newspaper operations on the bay may have made sense in the past, it no longer is the best fit.
"Importantly, the sale of this real estate has no impact on the mission of The Miami Herald and El Nuevo Herald," Pruitt said.
"The Miami Herald and El Nuevo Herald's commitments to providing high quality, public service journalism on multiple platforms and to providing the broadest, most effective reach for their advertisers have never been stronger," Pruitt said.
Pruitt said McClatchy will use $236 million of the proceeds as follows:
$163 million will be contributed to the company's pension plan.
$65 million will be offered (the Offer) to the holders of the company's 2017 senior secured notes (Noteholders) at par as required by the note indenture.
$2 million will be used to pay for transfer taxes associated with the sale.
The remaining $6 million will be held in an escrow account payable to McClatchy upon relocation of its Miami operations.
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