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Leases
12 Months Ended
Dec. 31, 2023
Leases [Abstract]  
Leases Leases
New Lease
On September 28, 2023, the Company entered into a lease agreement for a premise consisting of approximately 100,904 square feet located at Oyster Point Blvd, South San Francisco, California (the "Oyster Point Lease"), which the Company intends to use as laboratory and office space. The lease term of approximately seven years will start upon the Landlord’s substantial completion of tenant improvements, and may be extended for a period of eight years at then prevailing market rates for a comparable property. Future lease payments are approximately $43.7 million and are expected to start in the third quarter of 2024. Additionally, the Company is required to provide a letter of credit to the Landlord in the amount of $1.4 million in connection with the Oyster Point Lease. The Company has not recognized a right-of-use asset ("ROU") or aggregate lease liability as of December 31, 2023 for this lease as the Company did not control the underlying assets at any time during the year ended December 31, 2023.
Existing leases
In conjunction with the Oyster Point Lease, we modified the lease term of our existing lease to end upon the start date of the Oyster Point Lease. As a result of this modification, we reduced our lease liability and our right-of-use asset by $1.8 million as of December 31, 2023. Additionally, we paid a refundable security deposit of approximately $0.4 million at inception of the lease term which has been reclassified from other non-current assets to other current assets in the balance sheet of December 31, 2023.
Operating lease ROU assets and liabilities on our balance sheets represent the present value of our remaining lease payments over the remaining lease terms. We use our incremental borrowing rate to calculate the present value of our lease payments, as the implicit rates in our leases are not readily determinable. Operating lease liabilities are based on the net present value of the remaining lease payments over the remaining lease term. In determining the present value of lease payments, the Company used its incremental borrowing rate based on the information available at the date of adoption of Topic 842 or the date of lease modification.
The undiscounted future non-cancellable lease payments of the Company's operating lease liability as of December 31, 2023 were as follows (in thousands):
Year ending December 31:Operating Leases
2024$1,382 
Total undiscounted lease payments1,382 
Less: Present value discount(64)
Total current operating lease liabilities1,318 
Total non-current operating lease liabilities$— 
The weighted-average remaining lease terms and discount rates related to the Company's operating leases were as follows:
As of December 31,
20232022
Weighted-average remaining lease term (in years)0.62.3
Weighted-average discount rate13.60 %8.2 %
Variable lease costs comprise primarily of the Company's proportionate share of operating expenses, property taxes, and insurance. Short-term lease expense and variable lease payments recorded in operating expenses were immaterial for the years ended December 31, 2023, 2022 and 2021. Lease expenses for the years ended December 31, 2023, 2022 and 2021 are as follows (in thousands)
As of December 31,
202320222021
Operating lease costs$2,771 $2,501 $2,300 
Other variable costs766 721 949 
Total expense$3,537 $3,222 $3,249