Leases

9 Months Ended

Sep. 30, 2024

Leases

Leases

8.  Leases

Leases as a Lessor:

The Company is a lessor of commercial real estate with operations that include the leasing of office and industrial properties. Many of the leases with customers contain options to extend leases at a fair market rate and may also include options to terminate leases. The Company considers several inputs when evaluating the amount it expects to derive from its leased assets at the end of the lease terms, such as the remaining useful life, expected market conditions, fair value of lease payments, expected fair values of underlying assets, and expected deployment of the underlying assets. The Company’s strategy to address its risk for the residual value in its commercial real estate is to re-lease the commercial space.

The Company has elected to apply the practical expedient to not separate non-lease components from the related lease component of real estate leases. This combined component is primarily comprised of fixed lease payments, early termination fees, common area maintenance cost reimbursements, and parking lease payments. The Company applies ASC 842-Leases to the combined lease and non-lease components.

For the nine months ended September 30, 2024 and 2023, the Company recognized the following amounts of income relating to lease payments:

Income relating to lease payments:
	For the Nine Months Ended September 30,
(in thousands)	2024		2023
Income from leases (1)	$	92,937	$	111,316
	$	92,937	$	111,316
(1) Includes amounts recognized from variable lease payments of $26,584 and $32,275 for the nine months ended September 30, 2024 and 2023, respectively.