Red Hat to Sublease Two Progress Plaza from Progress Energy for $87M

By Liviu Oltean, Associate Editor Red Hat and Progress Energy’s negotiations over the sublease of the Two Progress Plaza tower have come to a close. The two companies have agreed to a 23-year sub-lease valued at about $87 million. According to a report [...]

Red Hat and Progress Energy’s negotiations over the sublease of the Two Progress Plaza tower have come to a close. The two companies have agreed to a 23-year sub-lease valued at about $87 million.

According to a report filed by Red Hat with the U.S. Securities and Exchange Commission, Progress Energy is scheduled to vacate Two Progress Plaza by Jan. the 1st, 2013. At that time, Two Progress Plaza will be delivered to Red Hat and occupied by Red Hat’s employees.

Red Hat’s liabilities include about $86.68 million in total lease payments, with various tenant-concessions that will downsize the total amount by millions of dollars. In addition, the company will be responsible for the taxes and all of the operating expenses, with the exception of the parking deck and the retail spaces.

Red Hat is currently occupying about 191,000-square-feet of space at N.C. State University’s Centennial Campus, which has been already marketed as sub-leasable. The company will be moving about 600 employees to the Two Progress Plaza, and, upon securing two development incentives grants that total up to $15 million over the next 12 years, it will add about 540 new job opportunities.

As reported by the Triangle Business Journal, Red Hat has been paying about $1.7 million in rent per year for the 1801 Varsity Drive building, which serves as the current headquarters, and about $1.8 million per year for the Venture III building on Centennial Campus.

Image Courtesy of Jwaterwo, Wikipedia