NOTE 4: ASSETS HELD FOR SALE AND SALES OF REAL ESTATE

Assets Held for Sale—Assets held for sale in the Company’s unaudited Condensed Consolidated Balance Sheet consisted of the following (in thousands):



	September 30, 2016		December 31, 2015
Real estate	$	17,878	$	206,422

As of September 30, 2016, the Company had 8 real estate properties held for sale. As of December 31, 2015, the real estate properties held for sale included Tribune Tower in Chicago, IL (“Tribune Tower”), the north block of the Los Angeles Times Square property in downtown Los Angeles, CA (“LA Times Property”) and the Olympic Printing Plant facility in the Arts District of downtown Los Angeles, CA (“Olympic Facility”). The combined net carrying value of $18 million and $206 million for the properties held for sale is included in assets held for sale in the Company’s Consolidated Balance Sheet at September 30, 2016 and December 31, 2015, respectively.

The Company recorded charges of $1 million and $15 million in the three and nine months ended September 30, 2016, respectively, to write down certain properties to their estimated fair value, less the expected selling costs, which were determined based on certain assumptions and judgments that are Level 3 within the fair value hierarchy.

Sales of Real Estate—In the three and nine months ended September 30, 2016, the Company sold several properties for net pretax proceeds totaling $473 million and $505 million, respectively, and recognized a net pretax gain of $213 million in the three and nine months ended September 30, 2016, as further described below. The Company defines net proceeds as pretax cash proceeds on the sale of properties, net of associated selling costs.

On May 2, 2016, the Company sold its Deerfield Beach, FL property for net proceeds of $24 million, and on June 2, 2016, the Company sold its Allentown, PA property for net proceeds of $8 million. In the second quarter of 2016, the Company recorded a net pretax loss of less than $1 million on the sale of these properties that is included in SG&A.

On July 7, 2016, the Company sold its Seattle, WA property for net proceeds of $19 million and entered into a lease retaining the use of more than a minor portion of the property. The Company recorded a deferred pretax gain of $8 million on the sale which will be amortized over the life of the lease due to the transaction being a sale-leaseback. On July 12, 2016, the Company sold two of its Orlando, FL properties for net proceeds of $34 million and recorded a pretax gain of $2 million. On July 14, 2016, the Company sold its Arlington Heights, IL property for net proceeds of $0.4 million. On September 26, 2016, the Company sold Tribune Tower and the LA Times Property for net proceeds of $200 million and $102 million, respectively, and recognized a pretax gain of $93 million and $59 million, respectively. Pursuant to the terms of the sale agreements, the Company could receive contingent payments of up to an additional $35 million related to the Tribune Tower transaction and an additional $10 million related to the LA Times Property transaction. For both the Tribune Tower and LA Times Property sales, the contingent payments become payable if certain conditions are met pertaining to development rights related to the respective buyer’s plans for development of portions of the two properties. The contingency period for both properties ends five years from the sale date with the possibility of extension in certain circumstances. On September 27, 2016, the Company sold the Olympic Facility for net proceeds of $119 million and recognized a pretax gain of $59 million.

Additionally, as of November 9, 2016, the Company has agreements for the sales of certain broadcasting real estate properties located in Chicago, IL and Portsmouth, VA, some of which will qualify as sale-leasebacks. All of these transactions are expected to close during the fourth quarter of 2016. The closing of these transactions is subject to certain adjustments and customary closing conditions and there can be no assurance that these sales will be completed in a timely manner or at all.

In the nine months ended September 30, 2015, the Company sold two properties which were located in Bel Air, MD and Newport News, VA for net proceeds of $5 million and recorded a net pretax loss of less than $1 million.