Property and Equipment

Gaming and lottery machinery and equipment, including assets under capital leases, were as follows:



	September 30, 2015			December 31, 2014
Gaming equipment	$	772.0		$	799.9
Less: accumulated depreciation	(266.4		)	(279.1		)
Gaming equipment, net	505.6			520.8

Lottery machinery and equipment	307.9			311.7
Less: accumulated depreciation	(231.2		)	(207.4		)
Lottery machinery and equipment, net	76.7			104.3

Total gaming and lottery machinery and equipment, net	$	582.3		$	625.1

Property and equipment consisted of the following:



	September 30, 2015			December 31, 2014
Land	$	39.1		$	43.0
Buildings and leasehold improvements	183.1			206.3
Furniture and fixtures	40.8			36.2
Transportation equipment	4.4			5.0
Construction in progress	38.6			11.7
Other property and equipment, at cost	292.3			292.8
Less: accumulated depreciation	(312.2		)	(207.3		)
Property and equipment, net	$	286.1		$	387.7

Total property and equipment, net	$	868.4		$	1,012.8

Depreciation expense for the three and nine months ended September 30, 2015 was $72.8 million and $249.1 million, respectively. Depreciation expense for the three and nine months ended September 30, 2014 was $58.5 million and $166.8 million, respectively. Depreciation expense is excluded from cost of services, cost of product sales, cost of instant games and other operating expenses and is separately stated within D&A in the Consolidated Statements of Operations and Comprehensive Loss. Accumulated amortization of capital lease assets was $10.8 million and $5.3 million as of September 30, 2015 and December 31, 2014, respectively.

During the nine months ended September 30, 2015, the Gaming business segment disposed of certain fully depreciated gaming assets with a historical cost of $59.9 million. The disposal had no impact on property and equipment, net in our Consolidated Balance Sheets as of September 30, 2015 or D&A in the Consolidated Statements of Operations and Comprehensive Loss for three and nine months ended September 30, 2015. In addition, during the three and nine months ended September 30, 2015, we recorded an impairment of $0.5 million and $5.7 million, respectively, related to gaming equipment assets for certain product lines that were discontinued as a result of the Bally acquisition. The impairment is included in D&A in our Consolidated Statements of Operations and Comprehensive Loss for the three and nine months ended September 30, 2015. There were no impairments of our gaming equipment fixed assets recorded for the three and nine months ended September 30, 2014.

As a result of our acquisition of Bally in the fourth quarter of 2014, we determined that we would consolidate our gaming manufacturing operations in Las Vegas, Nevada and sell our manufacturing facility in Waukegan, Illinois. As a result, we recorded a $9.4 million facility impairment in the fourth quarter of 2014. In June 2015 we ceased manufacturing operations at our Waukegan facility and are actively marketing the facility for sale. During the second quarter of 2015, we initiated plans to sell our facility in Reno, Nevada, and consolidate our operations in one of our leased facilities, which supports sales, distribution, WAP operations and development operations for our Gaming business. In June 2015, we recorded a $4.9 million impairment of this facility to adjust the carrying value to fair value less cost to sell. This charge is included in D&A in the Consolidated Statements of Operations and Comprehensive Loss for nine months ended September 30, 2015. Both the Waukegan and Reno facilities are part of our Gaming business segment and represented $27.5 million of land and buildings, which we have classified as held for sale within prepaid expenses, deposits and other current assets in our Consolidated Balance Sheets as of September 30, 2015. In August 2015, we executed an agreement to sell our Reno facility and the sale closed in November 2015.