Unable to increase its TV station holdings due to an unusually competitive market, Sinclair Broadcast Group revealed on October 31 that it has begun investing in commercial real estate in Maryland and other places.

Sinclair, the largest independent owner of TV stations in the U.S., spent $35.1 million for its initial purchases, which included a $9.1 million commercial warehouse and a $17.1 million office building in Baltimore, $5.2 million on land for development in Chapel Hill, N.C., and $3.7 million on land for development in Annapolis.

The real estate investments join others the company has recently made outside of its core industry, including purchasing equity in a Baltimore information technology business and buying a Baltimore commercial signage company last May. According to Sinclair CEO David D. Smith, the company is enjoying returns on its outside investments as high as 20 percent.

A spokesperson for Sinclair denied that the company is trying to compete with commercial real estate firms, saying that it is putting together a group that will focus on the company’s real estate and other non-core interests instead. Three Sinclair employees are currently members of this group.
Sinclair Broadcast’s third quarter earnings outdid Wall Street’s estimates by 8 cents a share. The company reported that third-quarter net income of $9.9 million equal to 11 cents per share, figures that show a drop from last year’s third quarter totals of $22.6 million, or 25 cents per share.

Sinclair, which also had a $12.4 million income tax gain in the quarter last year and boosted its annual per-share dividend from 60 cents to 70 cents, ascribed the drop in third quarter earnings to weaker advertising revenues. Its net revenues from broadcasting were $149.4 million, less than 1 percent lower than the $150.3 million it reported for the third quarter of 2006.

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