Leases

9 Months Ended

Sep. 30, 2019

Leases [Abstract]

LEASES

LEASES

At September 30, 2019, the Company had five properties subject to operating ground leases with a weighted average remaining term of 72 years and two finance ground leases with a weighted average remaining term of five years. At September 30, 2019, the Company had right-of-use assets of $69.5 million included in operating properties, projects under development, or land on the condensed consolidated balance sheets and a lease liability of $70.1 million included in other liabilities on the condensed consolidated balance sheets. The weighted average discount rate on these ground leases at September 30, 2019 was 4.5%.

Rental payments on these ground leases are adjusted periodically based on either the Consumer Price Index, changes in developed square feet on the underlying leased asset, or on a pre-determined schedule. The monthly payments on a pre-determined schedule are recognized on a straight-line basis over the terms of the respective leases while payments resulting from changes in the Consumer Price Index or future development are reflected in the statement of operations at the time of the change.

For the three and nine months ended September 30, 2019, the Company recognized operating ground lease expense of $1.1 million and $2.8 million, respectively, of which no amounts represented variable lease expenses, and recognized interest expense related to finance ground leases of $115,000 and $347,000, respectively. For the three and nine months ended September 30, 2019, the Company paid $478,000 and $1.4 million, respectively, in cash related to operating ground leases and made no cash payments related to financing ground leases. At September 30, 2019 and December 31, 2018, respectively, the future minimum payments to be made by consolidated entities for ground leases are as follows (in thousands):

September 30, 2019
	Operating Ground Leases			Finance Ground Leases
2019	$	818		$	462
2020	3,175			462
2021	2,959			6,562
2022	2,672			162
2023	2,614			162
Thereafter	202,604			3,838
	$	214,842		$	11,648
Discount	(155,027		)	(1,572		)
Lease liability	$	59,815		$	10,076

December 31, 2018
	Operating Ground Leases		Finance Ground Leases
2019	$	2,441	$	462
2020	2,460		462
2021	2,497		6,562
2022	2,497		162
2023	2,497		162
Thereafter	202,603		3,838
	$	214,995	$	11,648

LEASES

LEASES

At September 30, 2019, the Company had five properties subject to operating ground leases with a weighted average remaining term of 72 years and two finance ground leases with a weighted average remaining term of five years. At September 30, 2019, the Company had right-of-use assets of $69.5 million included in operating properties, projects under development, or land on the condensed consolidated balance sheets and a lease liability of $70.1 million included in other liabilities on the condensed consolidated balance sheets. The weighted average discount rate on these ground leases at September 30, 2019 was 4.5%.

Rental payments on these ground leases are adjusted periodically based on either the Consumer Price Index, changes in developed square feet on the underlying leased asset, or on a pre-determined schedule. The monthly payments on a pre-determined schedule are recognized on a straight-line basis over the terms of the respective leases while payments resulting from changes in the Consumer Price Index or future development are reflected in the statement of operations at the time of the change.

For the three and nine months ended September 30, 2019, the Company recognized operating ground lease expense of $1.1 million and $2.8 million, respectively, of which no amounts represented variable lease expenses, and recognized interest expense related to finance ground leases of $115,000 and $347,000, respectively. For the three and nine months ended September 30, 2019, the Company paid $478,000 and $1.4 million, respectively, in cash related to operating ground leases and made no cash payments related to financing ground leases. At September 30, 2019 and December 31, 2018, respectively, the future minimum payments to be made by consolidated entities for ground leases are as follows (in thousands):

September 30, 2019
	Operating Ground Leases			Finance Ground Leases
2019	$	818		$	462
2020	3,175			462
2021	2,959			6,562
2022	2,672			162
2023	2,614			162
Thereafter	202,604			3,838
	$	214,842		$	11,648
Discount	(155,027		)	(1,572		)
Lease liability	$	59,815		$	10,076

December 31, 2018
	Operating Ground Leases		Finance Ground Leases
2019	$	2,441	$	462
2020	2,460		462
2021	2,497		6,562
2022	2,497		162
2023	2,497		162
Thereafter	202,603		3,838
	$	214,995	$	11,648