Publisher Condé Nast is currently withholding $2.4 million in rent at One World Trade Center for January 2021, according to The Wall Street Journal and multiple news outlets. The company could continue to withhold rent in subsequent months due to a rent dispute with its landlords, according to a recent bond document filing.
Condé Nast, which publishes Vogue, Vanity Fair and New Yorker, is looking to decrease its square footage and rent per square foot at One World Trade Center, according to documents the building’s co-owner, the Port Authority of New York and New Jersey published on February 3.
“The Port Authority believes it has strong contractual rights to enforce full payment by Advance (Condé Nast’s owner) which it intends to assert,” the agency said in the filing.
“Advance continues to be in discussions about bringing the lease in 1 WTC into line with current market conditions and its ongoing needs at that location,” an Advance Publications spokesperson said. “We are also considering alternative solutions to address these requirements.”
Condé Nast became One World Trade Center’s anchor tenant in 2014. The publisher leased 1.2 million square feet of office space at the time. The Port Authority struggled to lease the rest of the 3.1 million square foot tower, however. In February 2020 the Port Authority finally its target of leasing 93% of the tower. Unfortunately, Condé Nast started to reduce its footprint in the tower and sublet 150,000 square feet of space to other companies.
Meanwhile, Condé Nast fell into the same trouble as a lot of its publishing counterparts did when the COVID-19 pandemic hit the United States—lost print advertising revenue forced the company to lay off approximately 100 employees and furlough about the same amount, according to The Wall Street Journal. Condé Nast also began to look elsewhere for 400,000 square feet of alternative office space to conduct some of its operations.
Despite lost ad revenue because of the pandemic, the Port Authority and the Durst Organization, which co-owns One World Trade Centre, believe Condé Nast has the resources necessary to pay the rent it’s been withholding. The companies said Advance has billions of dollars in assets and has profited from investments in other companies.
“These companies are entirely capable of satisfying their legal obligations, and the Port Authority has strong rights to enforce full payment,” Port Authority spokesman Ben Branham said.
Joe Dyton can be reached at firstname.lastname@example.org.