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LEASES (Tables)

6 Months Ended

Mar. 31, 2021

Information related to weighted average lease terms and discount rates is as follows:


	March 31, 2021
Weighted average remaining lease terms (years):
Operating leases	24
Finance leases	19
Weighted average discount rates:
Operating leases	7.68	%
Finance leases	7.76	%

The components of lease expense are as follows (in thousands):


	For the		For the		For the		For the
	Three Months Ended		Three Months Ended		Six Months Ended		Six Months Ended
	March 31, 2021		March 31, 2020		March 31, 2021		March 31, 2020
Operating lease expense	$	11,349	$	9,375	$	22,704	$	18,976
Short-term lease expense	7,661		7,594		14,216		17,550
Variable lease expense	3,909		3,198		7,865		6,807
Finance lease expense:
Amortization of right-of-use assets	679		606		1,252		1,213
Interest on lease liabilities	488		391		875		788
Less: sublease income (1)	(4,134)		(7,121)		(8,057)		(16,725)
Total	$	19,952	$	14,043	$	38,855	$	28,609

________

(1)Represents income earned by the Company from the rental of hotel, convention or retail space at the MGE Niagara Resorts and the Earth Hotel Tower at Mohegan Sun, both of which are leased properties.

Supplemental cash flow information related to lease liabilities is as follows (in thousands):


	For the		For the
	Six Months Ended		Six Months Ended
	March 31, 2021		March 31, 2020
Cash paid for amounts included in the measurement of lease liabilities:
Payments on operating lease obligations	$	8,214	$	16,434
Payments for interest on finance lease obligations	119		787
Payments on finance lease obligations	536		828
Total	$	8,869	$	18,049

Operating Lease Liability

Maturities of right-of-use lease obligations are as follows (in thousands):


	Operating Leases		Finance Leases
Fiscal years:
2021 (1)	$	42,947	$	3,958
2022	38,950		8,005
2023	39,924		12,133
2024	39,726		11,702
2025	39,992		11,302
Thereafter	831,970		171,648
Total future lease payments	1,033,509		218,748
Less: amounts representing interest	(547,777)		(107,435)
Plus: residual values	—		327
Present value of future lease payments	485,732		111,640
Less: current portion of lease obligations	(32,739)		(4,165)
Lease obligations, net of current portion	$	452,993	$	107,475

________

(1)Represents payment obligations from April 1, 2021 to September 30, 2021.

Finance Lease Liability

Maturities of right-of-use lease obligations are as follows (in thousands):


	Operating Leases		Finance Leases
Fiscal years:
2021 (1)	$	42,947	$	3,958
2022	38,950		8,005
2023	39,924		12,133
2024	39,726		11,702
2025	39,992		11,302
Thereafter	831,970		171,648
Total future lease payments	1,033,509		218,748
Less: amounts representing interest	(547,777)		(107,435)
Plus: residual values	—		327
Present value of future lease payments	485,732		111,640
Less: current portion of lease obligations	(32,739)		(4,165)
Lease obligations, net of current portion	$	452,993	$	107,475

________

(1)Represents payment obligations from April 1, 2021 to September 30, 2021.

Schedule of Rent Expense

Lease income consists of the following (in thousands):


	For the Three Months Ended March 31, 2021				For the Three Months Ended March 31, 2020
	Hotel		Retail, Entertainment and Other		Hotel		Retail, Entertainment and Other
Fixed rent	$	11,104	$	1,317	$	11,355	$	1,856
Variable rent	—		935		—		1,477
Total	$	11,104	$	2,252	$	11,355	$	3,333


	For the Six Months Ended March 31, 2021				For the Six Months Ended March 31, 2020
	Hotel		Retail, Entertainment and Other		Hotel		Retail, Entertainment and Other
Fixed rent	$	21,502	$	2,884	$	27,098	$	4,665
Variable rent	—		1,445		—		3,131
Total	$	21,502	$	4,329	$	27,098	$	7,796

Schedule of Lease Payments to be Received

Future fixed rental income that the Company expects to earn under non-cancelable operating leases, exclusive of amounts under contingent escalated rent clauses, is as follows (in thousands):


Fiscal years:	Operating Leases Fixed Rental Income
2021 (1)	$	3,122
2022	5,025
2023	4,405
2024	3,910
2025	2,815
Thereafter	6,720
Total	$	25,997

________

(1)Represents future fixed rental income from April 1, 2021 to September 30, 2021.

Schedule of Property and Equipment

The portions of Mohegan Sun, including the Sky Hotel Tower and the Earth Expo & Convention Center, and Mohegan Sun Pocono that are leased to third parties under operating leases are recorded within property and equipment, net as follows (in thousands):


	March 31, 2021		September 30, 2020
Property and equipment, at cost	$	483,788	$	484,143
Less: accumulated depreciation	(206,668)		(198,080)
Property and equipment, net	$	277,120	$	286,063