Leases

We conduct all of our retail sales and corporate operations in leased facilities. Lease terms generally range up to ten years and provide for escalations in base rents. We are generally not obligated to renew leases. Certain leases provide for additional rent based on a percentage of sales and annual rent increases generally based upon the Consumer Price Index. In addition, many of the store leases contain certain co-tenancy provisions that permit us to pay rent based on a pre-determined percentage of sales when the occupancy of the retail center falls below minimums established in the lease.

Operating leases

We lease office and warehouse space (10 and 12 Whatney, Irvine, California) from a company that is owned by the co-founders of Tillys. This lease was amended in December 2017 and was re-classified from a capital lease to an operating lease. The lease expires on December 31, 2027. We incurred rent expense of $0.2 million in fiscal year 2017 under the operating lease classification, see Capital lease section for incurred rent expense in prior years.

We lease office and warehouse space (11 Whatney, Irvine, California) from a company that is owned by one of the co-founders of Tillys. We incurred rent expense of $0.4 million in each of the fiscal years 2017, 2016 and 2015, related to this lease. Pursuant to the lease agreement, the lease payment adjusts annually based upon the Los Angeles/Anaheim/Riverside Urban Consumer Price Index, not to exceed 7%, but a minimum of 3%, in any one annual increase. The lease expires on June 30, 2022.

We lease a building (17 Pasteur, Irvine, California) from a company that is owned by one of the co-founders of Tillys. We use this property as our e-commerce distribution center. We incurred rent expense of $1.0 million, $0.9 million and $0.9 million in fiscal years 2017, 2016 and 2015, respectively, related to this lease. Pursuant to the lease agreement, the lease payment adjusts annually based upon the Los Angeles/Anaheim/Riverside Urban Consumer Price Index, not to exceed 7%, but a minimum of 3%, in any one annual increase. The lease expires on October 31, 2021.

Future minimum rental commitments, by year and in the aggregate, under non-cancellable operating leases, including fixed common area maintenance charges, if any, for the above buildings and all of our store locations as of February 3, 2018 are as follows (in thousands):



Fiscal Year	Related Party		Other		Total
2018	$	3,233	$	65,796	$	69,029
2019	3,330		59,383		62,713
2020	3,429		54,356		57,785
2021	3,258		48,192		51,450
2022	2,276		39,966		42,242
Thereafter	11,274		72,326		83,600
Total	$	26,800	$	340,019	$	366,819

Rent expense under non-cancellable operating leases for fiscal years 2017, 2016 and 2015 was as follows (in thousands):



	February 3, 2018		January 28, 2017		January 30, 2016
Minimum rentals	$	44,520	$	42,988	$	43,176
Contingent rentals	1,552		1,212		403
Total rent expense	$	46,072	$	44,200	$	43,579

Capital lease

Prior to December 2017, our corporate headquarters and distribution center (10 and 12 Whatney, Irvine, California) was leased from a company owned by the co-founders of Tillys. The land component was accounted for as an operating lease and the building component was accounted for as a capital lease. We incurred rent expense of $0.9 million, $1.0 million and $0.9 million, in fiscal years 2017, 2016 and 2015, respectively, related to the operating (land component) of this lease.

The obligation under the capital lease was $0.8 million as of January 28, 2017. The gross amount of the building under the capital lease was $7.8 million and accumulated amortization was and $7.4 million as of and January 28, 2017.

Prior to signing each of the related party leases above, we received an independent market analysis regarding the property and therefore believe that the terms of each lease are reasonable and not materially different from terms we would have obtained from an unaffiliated third party.