Summary
Moody's Corporation has entered into a significant operating lease agreement for approximately 589,945 square feet of office space at 7 World Trade Center in New York City. This lease, with an initial term of roughly 21 years and renewal options, is contingent on receiving 'Qualifying Lease' status under the World Trade Center Rent Reduction Program. If this designation is not secured by October 16, 2006, or if the benefits differ from expectations, Moody's has the option to terminate the agreement without penalty. The lease commences with rent payments starting November 15, 2007, with annual base rents escalating over the initial term, ranging from approximately $24.5 million in the first five years to $33.3 million in the subsequent five years. These amounts are subject to potential reductions through the aforementioned incentive program. In addition to base rent, Moody's will be responsible for its pro-rata share of operating expenses and taxes.
Key Highlights
- 1Moody's Corporation signed a major operating lease for 589,945 sq ft at 7 World Trade Center.
- 2The lease has an initial term of approximately 21 years with renewal options.
- 3The agreement is conditional on receiving 'Qualifying Lease' status for the World Trade Center Rent Reduction Program.
- 4Moody's can terminate the lease without penalty if the program status or benefits are not as expected by October 16, 2006.
- 5Rent payments are scheduled to begin on November 15, 2007.
- 6Annual base rent starts at approximately $24.5 million and escalates over the initial term, with potential reductions from program benefits.
- 7The company will also incur costs for operating expenses and taxes.