Billionaire tenant cancels rent | Real Estate Weekly

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Publishing house Conde Nast is reneging on its rent at One World
Trade Center in a stand-off with the Port Authority to renegotiate the lease on
its 1.2 million square feet of office space in the tower.

In bond documents published by PANYNJ, the Authority said Condé
Nast is withholding $2.4 million in January rent and has warned it’s cancelling
its rent until it reaches new terms.

In a statement, Conde Nast parent, Advance Publications,
said: “Advance continues to be in discussions about bringing the lease in 1WTC
into line with current market conditions and its ongoing needs at that
location. We are also considering alternative solutions to address these
requirements.”

But the Port Authority says it has “strong contractual rights” to enforce full payment of the rent “which it intends to assert.”

Conde Nast is part of the Advance Publications empire owner by billionaire Donald Newhouse

Conde Nast relocated from the Durst Organization’s 4 Times
Square in 2014 after PANYNJ formed a partnership with Durst that gave the firm
a minority stake in the landmark skyscraper and paid the rent on the Times Square
space until Durst was able to find a new tenant to fill it.

It is estimated the Port Authority handed over around $200
million in rent payments to Durst before the dust settled.

However, Conde Nast was never able to fully occupy its new 1WTC
space as it struggled with falling print revenue on its titles, including Vogue
and Vanity Fair, and laid off a chunk of its workforce.

As early as last summer, the publisher said it was looking
for alternative space in midtown Manhattan and possibly even New Jersey.

The PANYNJ didn’t respond to a request for comment, but
Jordan Barowitz, a spokesman for Durst, sniped, “Condes’ parent company is
making a windfall in the stock market on IPOs and they claim they can’t pay
their rent.”

Founded in 1922 by Sam Newhouse, Advance Publications is a
holding company that has grown to be among the world’s biggest corporations.

Among its many investor positions, the company owns the Reddit
platform that just rocked the stock market with its revolt against short-selling
hedge funds, and Compass real estate brokerage.

Reddit is currently valued at over $3 billion and Compass
has filed its plans for an IPO that is expected to be a windfall for
shareholder such as Advance.

Donald Newhouse, the owner of Advance Publications, has a
reported net worth of $11.1 billion.

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