Land and buildings leased to others, which are subject to operating leases, and real estate under construction, are summarized as follows (in thousands):


	March 31, 2024		December 31, 2023
Land	$	2,292,183	$	2,248,300
Buildings and improvements	9,929,902		9,801,596
Real estate under construction	38,788		45,562
Less: Accumulated depreciation	(1,563,571)		(1,509,730)
	$	10,697,302	$	10,585,728

During the three months ended March 31, 2024, the U.S. dollar strengthened against the euro, as the end-of-period rate for the U.S. dollar in relation to the euro decreased by 2.2% to $1.0811 from $1.1050. As a result of this fluctuation in foreign currency exchange rates, the carrying value of our Land, buildings and improvements — net lease and other decreased by $79.5 million from December 31, 2023 to March 31, 2024.

In connection with changes in lease classifications due to extensions of the underlying leases or entering into a new lease, we reclassified 14 properties with an aggregate carrying value of $105.5 million from Net investments in finance leases and loans receivable to Land, buildings and improvements — net lease and other during the three months ended March 31, 2024 (Note 5).

Depreciation expense, including the effect of foreign currency translation, on our buildings and improvements subject to operating leases was $71.6 million and $91.3 million for the three months ended March 31, 2024 and 2023, respectively.

During the three months ended March 31, 2024, we entered into the following investments, which were deemed to be real estate asset acquisitions (dollars in thousands):


Property Location(s)	Number of Properties	Date of Acquisition	Property Type	Total Capitalized Costs
Doncaster, United Kingdom (a)	2	1/9/2024	Retail	$	30,055
Various, Italy (a)	5	1/30/2024	Industrial, Warehouse	148,130
Laval, Canada (a)	1	3/26/2024	Industrial	2,604
	8			$	180,789

The aggregate purchase price allocation for investments disclosed above is as follows (dollars in thousands):


	Total Capitalized Costs
Land	$	48,071
Buildings and improvements	111,460
Intangible assets:
In-place lease (weighted-average expected life of 18.2 years)	21,258
	$	180,789

During the three months ended March 31, 2024, we capitalized real estate under construction totaling $9.4 million. The number of construction projects in progress with balances included in real estate under construction was 10 and 11 as of March 31, 2024 and December 31, 2023, respectively. Aggregate unfunded commitments totaled approximately $107.5 million and $71.8 million as of March 31, 2024 and December 31, 2023, respectively.

During the three months ended March 31, 2024, we completed the following construction projects (dollars in thousands):

Property Location(s)

Primary Transaction Type

Number of Properties

Date of Completion

Property Type

Total Capitalized Costs

Salisbury, NC

Expansion

3/8/2024

Industrial

14,737

During the three months ended March 31, 2024, we committed to fund a redevelopment project for $44.1 million. We currently expect to complete the project in 2025.

Capitalized interest incurred during construction was $0.3 million and $0.1 million for the three months ended March 31, 2024 and 2023, respectively, which reduces Interest expense in the consolidated statements of income.

During the three months ended March 31, 2024, we sold three properties, which were classified as Land, buildings and improvements — net lease and other. As a result, the carrying value of our Land, buildings and improvements — net lease and other decreased by $19.2 million from December 31, 2023 to March 31, 2024 (Note 14).

2024 — For the three months ended March 31, 2024, other lease-related income on our consolidated statements of income included other lease-related settlements totaling $1.8 million.

2023 — For the three months ended March 31, 2023, other lease-related income on our consolidated statements of income included: (i) lease termination income totaling $11.4 million received from two tenants in connection with the sales of the properties they occupied and (ii) other lease-related settlements totaling $1.3 million.

Lease income related to operating leases recognized and included in the consolidated statements of income is as follows (in thousands):


	Three Months Ended March 31,
	2024		2023
Lease income — fixed	$	286,174	$	308,066
Lease income — variable (a)	36,077		44,270
Total operating lease income	$	322,251	$	352,336

(a)Includes (i) rent increases based on changes in the U.S. Consumer Price Index and other comparable indices and (ii) reimbursements for property taxes, insurance, and common area maintenance services.

At both March 31, 2024 and December 31, 2023, Land, buildings and improvements — operating properties consisted of our investments in 80 consolidated self-storage properties, five consolidated hotels, and two consolidated student housing properties. Below is a summary of our Land, buildings and improvements — operating properties (in thousands):


	March 31, 2024		December 31, 2023
Land	$	148,860	$	150,084
Buildings and improvements	1,104,556		1,104,635
Real estate under construction	2,755		1,530
Less: Accumulated depreciation	(87,350)		(80,057)
	$	1,168,821	$	1,176,192

Depreciation expense, including the effect of foreign currency translation, on our buildings and improvements attributable to operating properties was $7.3 million and $7.2 million for the three months ended March 31, 2024 and 2023, respectively.


	March 31, 2024		December 31, 2023
Land, buildings and improvements — net lease and other	$	—	$	46,986
In-place lease intangible assets and other	—		5,222
Above-market rent intangible assets	—		8,374
Accumulated depreciation and amortization	—		(23,460)
Assets held for sale, net	$	—	$	37,122

At December 31, 2023 we had two properties classified as Assets held for sale, net, with an aggregate carrying value of $37.1 million. These properties were sold in January 2024.