Operating Lease Right-of-Use Assets and Liabilities

9 Months Ended

Sep. 30, 2019

Operating Lease Right-of-Use Assets and Liabilities

Operating lease right-of-use assets, included in other assets, were $114.2 million at September 30, 2019. Operating lease liabilities, included in accrued expenses and other liabilities, were $135.1 million at September 30, 2019. In connection with the Merger, TCF recorded $39.8 million and $41.6 million of operating lease right-of-use assets and operating lease liabilities, respectively. Undiscounted future minimum operating lease payments and a reconciliation to the amount recorded as operating lease liabilities at September 30, 2019 were as follows:



(In thousands)
Remainder of 2019	$	9,137
2020	32,687
2021	23,902
2022	18,624
2023	15,807
Thereafter	48,737
Total undiscounted future minimum operating lease payments	148,894
Discount	(13,751		)
Total operating lease liabilities	$	135,143

As of September 30, 2019, TCF had approximately $250.1 million in additional leases for real property that have not yet commenced and are excluded from the operating lease liability table above. Of this amount, $231.7 million was related to a lease agreement for TCF Financial's new headquarters building in Detroit, Michigan signed on May 31, 2019 by Legacy Chemical, with an organization 50% owned by indirect related parties. The new headquarter lease has a term of 22.5 years commencing January 1, 2022 with renewal options.

The weighted-average discount rate and remaining lease term for operating leases were as follows:



	At September 30, 2019
Weighted-average discount rate	2.66	%
Weighted-average remaining lease term (years)	6.6

The components of total lease cost for operating leases, included in occupancy and equipment noninterest expense, were as follows:



	Three Months Ended			Nine Months Ended
(In thousands)	September 30, 2019
Lease expense	$	10,367		$	28,488
Short-term and variable lease cost	241			332
Sublease income	(447		)	(1,189		)
Total lease cost for operating leases	$	10,161		$	27,631

Supplemental cash flow information related to operating leases was as follows:



	Three Months Ended		Nine Months Ended
(In thousands)	September 30, 2019
Operating lease right-of-use assets obtained in exchange for operating lease liabilities	$	395	$	118,100
Cash paid for amounts included in the measurement of lease liabilities - operating	8,807		23,841