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Level 3 Backs Out of Fremont Lease

FREMONT, CA-Level 3 Communications may have gotten out of its Pacific Commons lease but it was a costly exit. The technology firm paid a multi-million early termination fee in addition to the $30 million in tenant improvements it made.

By Michelle Savage | Updated on March 05, 2002

FREMONT, CA-A wholly owned affiliate of Catellus Development Corporation has signed an agreement with Level 3 Communications LLC to terminate its lease on two industrial buildings at Pacific Commons in Fremont.

Under the terms of the agreement, all obligations for both parties will be terminated. Level 3 Communications will give Catellus an early termination payment equal to approximately 26 months of current rent. In exchange, it will be relieved of rent obligations for the remaining 19 years of the lease term.

A spokesperson for Catellus tells Globest.com that the lease was for two buildings totaling 165,000-sf. The first is a 65,000-sf data center and the other is 100,000-sf warehouse. Level 3 paid about $4 million in rent per year. Level 3 paid rent on the building from June 2001 through February of this year.

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