FedEx Corp. has signed a 30-year lease agreement with the Memphis-Shelby County Airport Authorityunder which it will pay a total of $240 million in rent for its international hub over the next
three decades, the airport authority announced.According to an SEC filing, subsidiary FedEx Express will continue to lease property atMemphis International Airport for its hub operations, including its primary sorting and handlingfacility, administrative offices and warehouse space.
The 30.5 million-square-foot area will cost the Memphis giant $6.8 million this year; therate will go up to $7.9 million in 2008. On July 1, 2013, and on every fifth anniversary of thatdate, the annual rent will increase by 13 percent, which would bring the total 30-year sum to morethan $240 million.
The new agreement replaces a lease agreement from 1979 between the authority and FedExExpress. The new lease is effective Jan. 1 and ends on Dec. 31, 2036, with optional extensionsthrough 2058.
“We are very happy that we have executed a new lease with FedEx Express to extend their leasefor an additional 30 years at Memphis International Airport,” said airport president and CEO LarryCox. “As the busiest cargo airport in the world and one of the most important economic engines inthe Mid-South region, it is gratifying that FedEx has agreed to continue their long-standingbusiness relationship with the Memphis-Shelby County Airport Authority.”
