The composition of premises and equipment at September 30, 2018 and December 31, 2017 was as follows:

	September 30,			December 31,
(dollars in thousands)	2018			2017
Land	$	70,628		$	73,046
Buildings		340,920			343,833
Furniture, fixtures, and equipment		101,418			94,254
Leasehold improvements		41,831			38,918
Total		554,797			550,051
Accumulated depreciation		(104,544	)		(91,977	)
Premises and equipment, net	$	450,253		$	458,074

Depreciation expense was $5.9 million for the three months ended September 30, 2018 and $17.7 million for the nine months ended September 30, 2018, compared to $5.8 million for the three months ended September 30, 2017 and $16.2 million for the nine months ended September 30, 2017.

Old National rents certain premises and equipment under operating leases, which expire at various dates. Many of these leases require the payment of property taxes, insurance premiums, maintenance, and other costs. In some cases, rentals are subject to increase in relation to a cost-of-living index. The leases have original terms ranging from two years and six months to twenty-five years, and Old National has the right, at its option, to extend the terms of certain leases for four additional successive terms of five years. Old National does not have any material sub-lease agreements. Rent expense was $4.4 million for the three months ended September 30, 2018 and $13.4 million for the nine months ended September 30, 2018, compared to $3.9 million for the three months ended September 30, 2017 and $11.6 million for the nine months ended September 30, 2017. See Note 3 to the consolidated financial statements for details regarding new guidance in Topic 842 that will affect the accounting for these leases effective January 1, 2019.

Old National had deferred gains remaining associated with prior sale leaseback transactions totaling $6.9 million at September 30, 2018 and $8.2 million at December 31, 2017. Under current GAAP, the gains will be recognized over the remaining term of the leases. The leases had original terms ranging from five to twenty-four years. Topic 842 may change how this gain is recognized beginning in first quarter 2019. See Note 3 to the consolidated financial statements for details regarding new accounting guidance in Topic 842.

Old National leases two branch buildings and certain equipment under capital leases. See Note 16 to the consolidated financial statements for detail regarding these leases.