Leases

6 Months Ended

Jul. 31, 2021

The Company determines if an arrangement contains a lease at the inception of a contract. Operating lease assets represent the Company’s right to use an underlying asset for the lease term and operating lease liabilities represent the Company’s obligation to make lease payments arising from the lease.

In response to the COVID-19 pandemic, certain of the Company's landlords agreed to temporary rent concessions. These rent concessions generally related to deferrals and abatements of certain rent payments due between April 2020 through October 2020 into future periods.

In accordance with the Financial Accounting Standards Board's staff guidance regarding rent concessions related to the effects of the COVID-19 pandemic, the Company has elected to account for the concessions agreed to by landlords that do not result in a substantial increase in the obligations of the lessee as if the enforceable rights and obligations for those concessions existed in the original lease agreements and the Company has elected to not remeasure the related lease liabilities and right-of-use assets. For qualifying rent abatement concessions, the Company has recorded negative variable lease expense for the amount of the concession during the period of relief, and for qualifying deferrals of rental payments, the Company has recognized a non-interest bearing payable in lieu of recognizing a decrease in cash for the lease payment that would have been made based on the original terms of the lease agreement, which will be reduced when the deferred payment is made in the future.

During the thirteen weeks ended July 31, 2021, the Company committed to 30 new store leases with average terms of approximately 10 years that have future minimum lease payments of approximately $68.6 million.

All of the Company's leases are classified as operating leases and the associated assets and liabilities are presented as separate captions in the consolidated balance sheets. As of July 31, 2021 and August 1, 2020, the weighted average remaining lease term for the Company's operating leases was 7.9 years and 8.0 years, respectively, and the weighted average discount rate was 6.2% and 6.6%, respectively.

The following table is a summary of the Company's components for net lease costs (in thousands):


	Thirteen Weeks Ended				Twenty-Six Weeks Ended
Lease Cost	July 31, 2021		August 1, 2020		July 31, 2021		August 1, 2020
Operating lease cost	$	49,265	$	42,273	$	96,794	$	82,621
Variable lease cost	14,020		10,619		27,650		21,962
Net lease cost*	$	63,285	$	52,892	$	124,444	$	104,583

* Excludes short-term lease cost, which is immaterial.

The following table summarizes the maturity of lease liabilities under operating leases as of July 31, 2021 (in thousands):


Maturity of Lease Liabilities	Operating Leases
2021	$	109,500
2022	210,299
2023	203,841
2024	193,741
2025	178,842
After 2025	620,838
Total lease payments	1,517,061
Less: imputed interest	285,465
Present value of lease liabilities	$	1,231,596

The following table summarizes the supplemental cash flow disclosures related to leases (in thousands):


	Twenty-Six Weeks Ended
	July 31, 2021		August 1, 2020
Cash paid for amounts included in the measurement of lease liabilities:
Cash payments arising from operating lease liabilities (1)	$	96,384	$	57,311
Supplemental non-cash information:
Operating lease liabilities arising from obtaining right-of-use assets	$	171,581	$	118,189

(1) Included within operating activities in the Company's Consolidated Statements of Cash Flows.