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FORT WORTH-RadioShack Corp. has decided to pay the construction tab for a $200-million corporate campus in cash rather than ink a synthetic lease. Construction begins in the first quarter, with an eye on a late 2004 delivery.

According to a press release, the financing decision “will have an immaterial impact upon RadioShack’s income statement in 2003 and beyond” although it’s acknowledged that it will eat into the company’s free cash flow projections. The coffer of available funds is now projected to be $215 million in 2003 and $235 million in 2004, minus the estimated $100-million increase per year in capital expenditures.

RadioShack’s Michael Newman, senior vice president and CFO, said the strategy will improve free cash flow by $30 million to $50 million over the next 20 years. The corporation says it is missing out on benefits of higher depreciation and lower maintenance costs that it can glean for the ledger and ones not available through its current sale/leaseback arrangements.

RadioShack, one of Fort Worth’s largest employers, has been leasing its existing headquarters–twin 20-story towers–in the downtown and a 300,000-sf technology building since December 2001 when it sold the towers to Dallas-based PNL Cos. and the tech building to Tarrant County so it could push ahead on the headquarters project.

The corporate campus site, which fronts the Trinity River, caused dissension in the community because it forced a shutdown and demolition of a subsidized housing project. With the controversy now history, the city and RadioShack have pulled out the golden shovels.

Meanwhile, Pier I Imports Inc., last week unveiled the finished design for a $60-million, 20-story corporate office building on 12 acres, right down the street from the RadioShack site. Pier I kicks off construction in January in a 20-month delivery schedule.

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