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CyberSource Extends HQ Lease, Lowers Rate

MOUNTAIN VIEW, CA-The locally based processor of electronic payments for web merchants extends its 72,000-sf headquarters lease by five years in trade for a significantly lower lease rate beginning in 2007.

By Brian K. Miller | Updated on January 18, 2005

MOUNTAIN VIEW, CA-Locally based CyberSource has extended its headquarters lease by five years in trade for a significantly lower lease rate. As a result, the publicly traded processor of electronic payments for web merchants will remain in 72,000 sf at 1295 Charleston Rd., a two-story R&D building, through 2011, according to a filing with the SEC. CyberSource’s original lease commenced in January 2000 at $187,200 per month ($2.60 per sf) and was to expire in December 2006 with the company paying more than $223,000 per month that final year, according to SEC filings. Under the extension agreement, the company will continue to pay those lofty rates–$216,000 per month ($3.00 per sf) this year and $223,000 per month ($3.10 per sf) in 2006–through the end of its original term. But beginning January 2007 and continuing through the end of the lease, the rate will drop to $80,640 per month ($1.12 per sf), which is close to current market rates.CyberSource controller Blake Burke tells GlobeSt.com that while the company will continue paying above-market rents this year and next, it very well could be paying below market rents through 2011 if the market continues to rebound. Scott Kinder and David Tipton of Cresa Partners, a tenant rep firm, represented CyberSource in the transaction. Building owner SL Investments V could not be reached for comment.

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