But Twenty Lake Holdings is not just another commercial real estate investor. It is a subsidiary of Alden Global Capital, the New York City hedge fund that backed the purchase of and dramatic cost-cutting at more than 100 newspapers — causing more than 1,000 lost jobs.
For Alden and its subsidiary, the Gannett empire’s newspapers are clearly an attractive feature. But by purchasing the Memphis building and others like it, Alden has already begun coming for what it may consider a bigger prize: Gannett’s real estate.
The hedge fund’s newspaper business, Digital First Media, is bidding to buy Gannett, operator of the nation’s largest chain of daily newspapers by circulation, including USA Today — as well as its $900 million in remaining property and equipment — for more than $1.3 billion.
The tactics employed by Alden and Digital First Media are well-chronicled: They buy newspapers already in financial distress, including big-city dailies such as the San Jose Mercury News and the Denver Post, reap the cash flow and lay off editors, reporters and photographers to boost profits.
In a 2018 court case, Alden disclosed it has a series of affiliated real estate companies whose business is focused primarily on efficiently buying, selling, leasing and redeveloping newspapers’ offices and printing plants.
James Angel, associate professor of finance in the Georgetown University’s McDonough School of Business, said other investment firms have used a similar strategy to monetize industries in decline.
“Alden is doing what I would call a pure liquidation strategy — which is, ‘no new investment and sell off what you can while you can,’ ” he said.