Condé Nast Buckles, Pays $10M In Back Rent At One World Trade Center
A multimillion-dollar tenant-landlord dispute at one of the country's most well-known office buildings has come to a close.
Advance Publications, which owns Condé Nast, the publisher of New Yorker and Vanity Fair magazine, has paid $10M to the Durst Organization for four months back rent at One World Trade Center, the New York Post reports.
Durst co-owns the 1,776-foot skyscraper with the Port Authority of New York and New Jersey, and has agreed to help facilitate subleases as Condé Nast works to offload 400K SF of its space. Advance stopped paying $2.4M in monthly rent in January, per the publication, after reportedly looking to break its lease at the property last August.
It is on the hook for 1.1M SF until 2039 as part of a landmark 25-year lease agreement, but the publisher was already considering paying a large severance fee just to be free of the building, Variety reported last summer. The company last year moved to lay off thousands of employees and cut the salaries of its highest earners.
Sources told the Post that Durst will work with Advance Publications' broker, JLL, to help find tenants to sublease the space, which is asking $60 per SF. Reddit has already agreed to take 40K SF of Condé Nast's space, per the Post.
“We are pleased to have resolved our differences and to continue to call One World Trade Center our home. We are collaborating with JLL and Durst to find additional first-class tenants to lease the space we no longer need, and we are pleased with the level of activity we are seeing,” a spokesperson for Advance told the Post.
Advance is just one of many big companies that have large blocks of sublease space on the market. JPMorgan Chase, Yelp and PricewaterhouseCoopers have all explored renting out their space. Meanwhile, the office market as a whole in Manhattan is facing an ongoing supply problem. A total of 2.4M SF of office space was leased in the second quarter, down 15% from Q1. Total vacancy continued to rise, and reached more than 14%.