The Company leases land, warehouse and office space, and equipment, which are classified as either operating or finance leases. The Company’s most significant lease is a long-term land lease with the City of San Diego covering approximately 190 acres, including approximately 17 acres of water in Mission Bay Park, California (the “Premises”). While there are no financial restrictions or covenants imposed by the Premises lease, there are certain operational restrictions in that the Premises must be used as a marine park facility and the Company may not operate another marine park facility within 560 miles of the City of San Diego.

The lease term for the Premises ends in June 2048 and the annual rent under the lease is variable and calculated on the basis of a specified percentage of the Company’s gross income from the Premises (the “Percentage Rent”), or the minimum yearly rent (the “Minimum Rent”), whichever is greater.

The required annual rent payments for the Premises is adjusted every three years to an amount equal to 80% of the average accounting year rent actually paid for the three previous years, with the annual minimum rent calculated as approximately $10.4 million through each of the years ended December 31, 2022, 2021 and 2020. The Company is awaiting the City of San Diego’s confirmation of the new adjusted minimum yearly rent, which will be effective as of January 1, 2023.

The annual rent payments may vary from the base rent due to a shift of seasonal performance results. Rent payments related to the Premises for the years ended December 31, 2022, 2021 and 2020 were approximately $13.6 million (including approximately $1.0 million remitted in 2022 related to 2021 and certain other fees), $11.1 million (including approximately $1.6 million remitted in 2021 related to 2020 Percentage Rent) and $0.5 million, respectively. The Company’s gross income from the Premises was significantly impacted during the year ended December 31, 2020 due to the temporary park closures, limited reopenings, modified operations and capacity restrictions resulting from the impact of the COVID-19 pandemic and related government restrictions in San Diego. Due to these factors, the Company deferred a payment of $8.3 million related to the Minimum Rent for the year ended December 31, 2020 (the “2020 Minimum Rent Payment”). As such, approximately $10.9 million and $10.8 million is included primarily in accounts payable and accrued expenses on the accompanying consolidated balance sheets as of December 31, 2022 and 2021, respectively, primarily related to the 2020 Minimum Rent Payment, the timing of the respective December rent payments, and certain accrued fees. Operating lease liabilities and long-term operating lease liabilities on the accompanying consolidated balance sheets as of December 31, 2022 and 2021 and the lease maturities as of December 31, 2022 are not adjusted for these deferred payments.

The tables below present the lease balances and their classification in the accompanying consolidated balance sheets as of December 31, 2022 and 2021:


		December 31,		December 31,
	Classification	2022		2021
Assets:		(In thousands)
Operating leases	Right of use assets - operating	$	130,479	$	132,217
Finance leases	Other assets, net		2,353		2,824
Total lease assets		$	132,832	$	135,041
Liabilities:
Current
Operating leases	Operating lease liabilities	$	3,387	$	2,895
Finance leases	Other accrued liabilities		171		486
Noncurrent
Operating leases	Long-term operating lease liabilities		115,396		117,046
Finance leases	Other liabilities		2,284		2,453
Total lease liabilities		$	121,238	$	122,880

The table below presents the lease costs and their classification in the accompanying consolidated statements of comprehensive income (loss) for the years ended December 31, 2022, 2021 and 2020:



	Classification	2022		2021		2020
		(In thousands)
Operating lease cost	Operating expenses	$	13,177	$	13,200	$	13,966
Operating lease cost	Selling, general and administrative expenses		337		415		425
Finance lease cost
Amortization of leased assets	Depreciation and amortization		469		817		844
Interest on lease liabilities	Interest expense		83		123		176
Net lease cost		$	14,066	$	14,555	$	15,411

In addition to the operating lease costs above, short-term rent expense for the years ended December 31, 2022, 2021 and 2020 were approximately $4.6 million, $2.7 million and $2.1 million, respectively, and variable rent expense for the years ended December 31, 2022, 2021 and 2020 were $4.6 million, $3.8 million and $4.9 million, respectively. The short-term and variable rent expense amounts are included primarily in operating expenses in the accompanying consolidated statements of comprehensive income (loss).

The table below presents the Company’s lease maturities as of December 31, 2022:


	Operating leases
Years Ending December 31,	Land lease			Other operating leases			Total operating leases			Finance leases
	(In thousands)
2023	$	10,401		$	2,432		$	12,833		$	242
2024		10,401			1,825			12,226			208
2025		10,401			1,422			11,823			201
2026		10,401			1,456			11,857			200
2027		10,401			225			10,626			198
Thereafter		213,227			845			214,072			1,994
Total lease payments		265,232			8,205			273,437			3,043
Less: Imputed interest		(153,494	)		(1,160	)		(154,654	)		(588	)
Lease liabilities	$	111,738		$	7,045		$	118,783		$	2,455

The table below presents the weighted average remaining lease terms and applicable discount rates as of December 31, 2022 and 2021:



	2022			2021
Weighted average remaining lease term (years):
Operating leases		24.27			25.26
Finance leases		15.08			14.23
Weighted average discount rate:
Operating leases		8.16	%		8.15	%
Finance leases		3.07	%		3.37	%

The table below presents the cash flows and supplemental information associated with the Company’s leasing activities for the years ended December 31, 2022, 2021 and 2020:



	2022		2021		2020
	(In thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	12,934	$	13,190	$	3,938
Operating cash flows from finance leases	$	83	$	123	$	176
Financing cash flows from finance leases	$	485	$	841	$	806
Right of use assets obtained in exchange for lease liabilities:
Finance leases	$	—	$	32	$	938
Operating leases	$	3,174	$	143	$	—