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Leases (Notes)

12 Months Ended

Dec. 29, 2019

Lessee activities

Operating leases

We have operating leases for office space and equipment. After the adoption of ASU 2016-02 in 2019, for all leases, a right-of-use asset and a lease liability, initially measured at the present value of the lease payments, are recognized in the Consolidated Balance Sheet as of December 29, 2019, as described below.

The table below presents the lease-related assets and liabilities recorded on the balance sheet:



(In thousands)	Classification in the Consolidated Balance Sheet	December 29, 2019
Operating lease right-of-use assets	Miscellaneous assets	$	53,549
Current operating lease liabilities	Accrued expenses and other	$	7,853
Noncurrent operating lease liabilities	Other	55,136
Total operating lease liabilities		$	62,989

The total lease cost for operating leases included in Selling, general and administrative costs in our Consolidated Statement of Operations was as follows:



	For the Twelve Months Ended
(In thousands)	December 29, 2019
Operating lease cost	$	9,980
Short term and variable lease cost	1,814
Total lease cost	$	11,794

Prior to the adoption of ASU 2016-02, rental expense was approximately $14 million in 2018 and $19 million in 2017.

The table below presents additional information regarding operating leases:



(In thousands, except lease term and discount rate)	December 29, 2019
Cash paid for amounts included in the measurement of operating lease liabilities	$	9,101
Right-of-use assets obtained in exchange for operating lease liabilities	$	61,270
Weighted-average remaining lease term	9.7 years
Weighted-average discount rate	4.64		%

Maturities of lease liabilities on an annual basis for the Company's operating leases as of December 29, 2019, were as follows:



(In thousands)	Amount
2020	$	10,092
2021	9,146
2022	8,689
2023	8,079
2024	7,042
Later Years	35,113
Total lease payments	$	78,161
Less: Interest	(15,172		)
Present value of lease liabilities	$	62,989

Finance lease

We had a finance lease in connection with the land at our College Point, N.Y., printing and distribution facility. Interest on the lease liability was recorded in Interest expense and other, net in our Consolidated Statement of Operations. Repayments of the principal portion of our lease liability are recorded within financing activities section and payments of interest on our lease liability are recorded within operating activities section in the Consolidated Statement of Cash Flows for our finance lease. On August 1, 2019, using existing cash, we purchased the assets under the finance lease for $6.9 million, which resulted in the settlement of our finance lease obligation. See Note 7 for more information.

Lessor activities

Our leases to third parties predominantly relate to office space in the Company Headquarters.

As of December 29, 2019, the cost and accumulated depreciation related to the Company Headquarters included in Property, plant and equipment in our Consolidated Balance Sheet was approximately $510 million and $204 million, respectively. Office space leased to third parties represents approximately 39% of rentable square feet of the Company Headquarters.

We generate building rental revenue from the floors in the Company Headquarters that we lease to third parties. The building rental revenue was as follows:



	For the Twelve Months Ended
(In thousands)	December 29, 2019
Building rental revenue ⁽¹⁾	$	30,595

⁽¹⁾ Building rental revenue includes approximately $10.8 million related to subleases for the fiscal year ended December 29, 2019.

Maturities of lease payments to be received on an annual basis for the Company's office space operating leases as of December 29, 2019, were as follows:



(In thousands)	Amount
2020	$	32,242
2021	32,259
2022	32,254
2023	19,329
2024	15,529
Later Years	126,633
Total building rental revenue from operating leases	$	258,246

Leases

Lessee activities

Operating leases

The table below presents the lease-related assets and liabilities recorded on the balance sheet:



(In thousands)	Classification in the Consolidated Balance Sheet	December 29, 2019
Operating lease right-of-use assets	Miscellaneous assets	$	53,549
Current operating lease liabilities	Accrued expenses and other	$	7,853
Noncurrent operating lease liabilities	Other	55,136
Total operating lease liabilities		$	62,989

The total lease cost for operating leases included in Selling, general and administrative costs in our Consolidated Statement of Operations was as follows:



	For the Twelve Months Ended
(In thousands)	December 29, 2019
Operating lease cost	$	9,980
Short term and variable lease cost	1,814
Total lease cost	$	11,794

Prior to the adoption of ASU 2016-02, rental expense was approximately $14 million in 2018 and $19 million in 2017.

The table below presents additional information regarding operating leases:



(In thousands, except lease term and discount rate)	December 29, 2019
Cash paid for amounts included in the measurement of operating lease liabilities	$	9,101
Right-of-use assets obtained in exchange for operating lease liabilities	$	61,270
Weighted-average remaining lease term	9.7 years
Weighted-average discount rate	4.64		%

Maturities of lease liabilities on an annual basis for the Company's operating leases as of December 29, 2019, were as follows:



(In thousands)	Amount
2020	$	10,092
2021	9,146
2022	8,689
2023	8,079
2024	7,042
Later Years	35,113
Total lease payments	$	78,161
Less: Interest	(15,172		)
Present value of lease liabilities	$	62,989

Finance lease

Lessor activities

Our leases to third parties predominantly relate to office space in the Company Headquarters.

We generate building rental revenue from the floors in the Company Headquarters that we lease to third parties. The building rental revenue was as follows:



	For the Twelve Months Ended
(In thousands)	December 29, 2019
Building rental revenue ⁽¹⁾	$	30,595

⁽¹⁾ Building rental revenue includes approximately $10.8 million related to subleases for the fiscal year ended December 29, 2019.

Maturities of lease payments to be received on an annual basis for the Company's office space operating leases as of December 29, 2019, were as follows:



(In thousands)	Amount
2020	$	32,242
2021	32,259
2022	32,254
2023	19,329
2024	15,529
Later Years	126,633
Total building rental revenue from operating leases	$	258,246

Leases

Lessee activities

Operating leases

The table below presents the lease-related assets and liabilities recorded on the balance sheet:



(In thousands)	Classification in the Consolidated Balance Sheet	December 29, 2019
Operating lease right-of-use assets	Miscellaneous assets	$	53,549
Current operating lease liabilities	Accrued expenses and other	$	7,853
Noncurrent operating lease liabilities	Other	55,136
Total operating lease liabilities		$	62,989

The total lease cost for operating leases included in Selling, general and administrative costs in our Consolidated Statement of Operations was as follows:



	For the Twelve Months Ended
(In thousands)	December 29, 2019
Operating lease cost	$	9,980
Short term and variable lease cost	1,814
Total lease cost	$	11,794

Prior to the adoption of ASU 2016-02, rental expense was approximately $14 million in 2018 and $19 million in 2017.

The table below presents additional information regarding operating leases:



(In thousands, except lease term and discount rate)	December 29, 2019
Cash paid for amounts included in the measurement of operating lease liabilities	$	9,101
Right-of-use assets obtained in exchange for operating lease liabilities	$	61,270
Weighted-average remaining lease term	9.7 years
Weighted-average discount rate	4.64		%

Maturities of lease liabilities on an annual basis for the Company's operating leases as of December 29, 2019, were as follows:



(In thousands)	Amount
2020	$	10,092
2021	9,146
2022	8,689
2023	8,079
2024	7,042
Later Years	35,113
Total lease payments	$	78,161
Less: Interest	(15,172		)
Present value of lease liabilities	$	62,989

Finance lease

Lessor activities

Our leases to third parties predominantly relate to office space in the Company Headquarters.

We generate building rental revenue from the floors in the Company Headquarters that we lease to third parties. The building rental revenue was as follows:



	For the Twelve Months Ended
(In thousands)	December 29, 2019
Building rental revenue ⁽¹⁾	$	30,595

⁽¹⁾ Building rental revenue includes approximately $10.8 million related to subleases for the fiscal year ended December 29, 2019.

Maturities of lease payments to be received on an annual basis for the Company's office space operating leases as of December 29, 2019, were as follows:



(In thousands)	Amount
2020	$	32,242
2021	32,259
2022	32,254
2023	19,329
2024	15,529
Later Years	126,633
Total building rental revenue from operating leases	$	258,246