Developer J. Brian O’Neill, founder of the substance-abuse chain Recovery Centers of America, has bought The Philadelphia Inquirer’s Montgomery County printing plant from the newspaper.
O’Neill paid $37 million for the Schuylkill Printing Plant at 800 River Rd. in Upper Merion Township, which The Inquirer announced last year it would sell in a cost-cutting move, the newspaper’s publisher, Lisa Hughes, said in an email to staff on Tuesday.
“The decision is part of a business strategy aimed at reducing operational expenses and ensuring the long term sustainability of The Inquirer,” she said. “SPP has been central to our operations for nearly 30 years, and I know that the decision to no longer print our own newspapers is an emotional one for many.”
O’Neill confirmed that he bought the Inquirer property, but had no other immediate comment.
He had previously said that he had signed a contract to buy the 674,000-square-foot building on more than 45 acres beside the Schuylkill, saying it would form part of a network of lab and office buildings occupied by a life-science tenants that he has planned for the area.
The other components of what he has dubbed Discovery Labs consist of a pharmaceutical complex once owned by GlaxoSmithKline and offices that O’Neill’s business bought from Liberty Property Trust.
The Inquirer announced in October that it would sell the nearly 30-year-old plant and shift production of its newspapers — The Inquirer itself and the Daily News — to a printing plant in Cherry Hill owned by Gannett Co., the nation’s largest newspaper company.
The property was listed for sale with the commercial real estate firm of Newmark Knight Frank, which looked for a buyer among firms seen as able to buy an asset of the Inquirer plant’s size and in its location, said Timothy N. Spreitzer, an Inquirer spokesperson.
After more than a dozen firms looked at the property, The Inquirer selected O’Neill from among multiple bidders, Spreitzer said. The sale was approved by The Inquirer’s board, he said.
The sale price of $37 million — or about $55 a square foot — is about what one would expect to pay for an industrial building of the Inquirer plant’s age in Philadelphia’s southeast Pennsylvania suburbs, said Pete Davisson, a principal with commercial real estate firm Jackson Cross Partners.
Hughes said Tuesday that a portion of the proceeds would go toward taxes and other expenses related to the sale, as well as to help pay for severance packages to plant employees who will lose their jobs.
The Inquirer said in October that about 500 of the 550 employees who work at the plant would be laid off, nearly half of The Inquirer’s total workforce of 1,073.
For now, those workers remain employed, with The Inquirer still in the property as a rent-paying tenant until printing begins at the Gannett facility, Hughes said. Executives said printing is expected to shift to Gannett’s Cherry Hill plant by the end of March.