Scholastic is setting up its Soho headquarters for sale, with a twist.
The book publishing giant is eyeing a sale of part or all of its buildings at 555-557 Broadway in the trendy Manhattan neighborhood, Crain’s reported. Scholastic tapped Newmark to seek potential buyers for the property.
Scholastic would look to then lease back the space from the buyer of the property. It would use the funds from the sale for “capital allocation priorities,” reducing its debt and repurchasing shares.
Scholastic occupies all but two floors of the office property, spanning roughly 300,000 square feet. As of last spring, the property’s retail space was fully leased to Sephora and Capital One, while two office floors were available.
The publisher closed on its purchase of its U.S. headquarters at 555 Broadway in the spring of 2014 for $255 million. It bought the 325,000-square-foot property from South Carolina-based landlord ISE America, which had owned the building since 1996.
Prior to the purchase, it had been a tenant at the building since 1992 and has owned the adjacent building, at 557 Broadway, since 2010, when it paid $25.5 million for the property.
A recent sale in the neighborhood could provide guidance on what Scholastic may expect to recoup from a sale of the property.
Earlier this month, Tishman Speyer acquired a 150,000 square-foot office at 148 Lafayette Street for $105 million. The Scholastic building is a little more than double the size of 148 Lafayette, putting a potential sale in the ballpark of what the publisher paid for the property more than a decade ago.
Scholastic declined to comment further on the headquarters marketing. The company reported last year revenue decreased by 7 percent, to $1.6 billion, while operating income fell by 85 percent to $15 million.
— Holden Walter-Warner
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