Leases

The Company leases office, warehouse and multi-recreational facilities and certain equipment under non-cancelable operating leases. In addition to base rent, the facility leases generally provide for additional rent based on operating results, increases in real estate taxes and other costs. Certain leases provide for additional rent based upon defined formulas of revenue, cash flow or operating results of the respective facilities. Under the provisions of certain of these leases, the Company is required to maintain irrevocable letters of credit, which amounted to $1,136 as of December 31, 2015.

The leases expire at various times through October 31, 2031 and certain leases may be extended at the Company’s option. Escalation terms on these leases generally include fixed rent escalations, escalations based on an inflation index such as CPI, and fair market value adjustments. In the next five years, or the period from January 1, 2016 through December 31, 2020, the Company has leases for 20 club locations that are due to expire without any renewal options, three of which are due to expire in 2016, and 53 club locations that are due to expire with renewal options.

Future minimum rental payments under non-cancelable operating leases are shown in the chart below.



	Minimum Annual Rental
Year Ending December 31,
2016	$	89,359
2017	84,159
2018	77,854
2019	70,191
2020	64,186
Aggregate thereafter	216,133

Rent expense for the years ended December 31, 2015, 2014 and 2013 was $124,920, $124,816 and $118,811, respectively. Such amounts include non-base rent items of $24,767, $24,340 and $23,539, respectively. Including the effect of deferred lease liabilities, rent expense was $123,872, $124,449 and $117,191 for the years ended December 31, 2015, 2014 and 2013.

The Company, as landlord, leases space to third party tenants under non-cancelable operating leases and licenses. In addition to base rent, certain leases provide for additional rent based on increases in real estate taxes, indexation, utilities and defined amounts based on the operating results of the lessee. The sub-leases expire at various times through December 31, 2022. Future minimum rentals receivable under noncancelable leases are shown in the chart below.



	Minimum Annual Rental
Year Ending December 31,
2016	$	2,214
2017	1,635
2018	1,140
2019	865
2020	709
Aggregate thereafter	514

Rental income, including non-cash rental income, for the years ended December 31, 2015, 2014 and 2013 was $4,669, $4,791 and $5,161, respectively. Such amounts include additional rental charges above the base rent of $0, $229 and $242 for the years ended December 31, 2015, 2014 and 2013, respectively. The Company previously owned the building at the 86th Street club location which housed a rental tenant that generated rental income of approximately $1,926 for the year ended December 31, 2105 and $2,000 for each of the years ended December 31, 2014 and 2013. Refer to Note 10 - Gain on Sale of Building for further details.

For the year ended December 31, 2013, rental income includes non-cash revenue of $424 related to an out of period adjustment for subtenants at certain locations.