Sam Zell is probably longing for a nice, old-fashioned real estate crash right now. After all, real estate moguls go bankrupt all the time and get famous for their second and third acts.

The real estate titan, who snapped up media giant Tribune and took it private last December, had big plans for newspapers with puppies and big profits. Instead, the company is close to defaulting on key debt covenants, locked in talks with lenders to restructure its payments, and has hired Bruce Wasserstein's Lazard to advise it through a possible bankruptcy filing.

The Wall Street Journal says that Zell's company may not be "generating enough cash flow to cover nearly $1 billion in interest payments due this year, and Tribune owes a $512 million debt payment in June." The New York Times also cautions that "the hiring of advisers, including Lazard and Sidley Austin, one of the company's longtime law firms, could be a just-in-case move, or a bargaining tactic."

With the nation's newspaper industry in shambles, Zell has been unable to offload other key Tribune holdings, such as the Chicago Cubs baseball team or a stake in the Food Network. Prospective buyers may have sat out the auctions knowing that the Tribune empire, which includes the Los Angeles Times, the Chicago Tribune, and the Baltimore Sun, wouldn't see any real turnaround under Zell's management.

In the interest of journalistic schadenfreude, it would be comforting to see Zell chow down on some humble pie with a bankruptcy filing, but this move could be a plan to tear the empire down as fast as he can and recalibrate the businesses to fit the current environment and, more pointedly, the mission he's plotted. The cost of shutting down papers, however, could be a further drag on the company's cash position.

Since taking over Tribune, though, Zell often has been dismissive of newspaper owners and disdainful of journalists. In a recent interview with Joanne Lipman, the editor in chief of Condé Nast Portfolio, Zell labeled the newspaper business model "unequivocally...a failure," and challenged New York Times publisher Arthur Sulzberger, saying "If you want to be a charitable trust, be a charitable trust. If you don't want to be a charitable trust, then you've got to focus on producing a return for investors' capital, and it's just that simple."

He even went as fast as to hire a chief innovation officer to revamp the papers.