Leases

12 Months Ended

Sep. 30, 2023

17. Leases

Our headquarters are located at 121 Seaport Boulevard, Boston, Massachusetts. The lease is for approximately 250,000 square feet and runs through June 30, 2037. We have subleased a portion of the leased space through January 31, 2024. Base rent for the first year of the lease was $11.0 million and increases by $1 per square foot per year thereafter ($0.3 million per year). Base rent first became payable on July 1, 2020. In addition to the base rent, we are required to pay our pro rata portions of building operating costs and real estate taxes (together, “Additional Rent”). Annual Additional Rent is estimated to be approximately $8.1 million.

The components of lease cost reflected in the Consolidated Statements of Operations for the years ended September 30, 2023, 2022, and 2021 were as follows:


(in thousands)	Year ended September 30,
	2023			2022			2021
Operating lease cost	$	32,402		$	34,346		$	37,295
Short-term lease cost		5,411			2,653			2,452
Variable lease cost		10,945			10,095			9,808
Sublease income		(4,749	)		(4,600	)		(4,438	)
Total lease cost	$	44,009		$	42,494		$	45,117

Supplemental cash flow information for the years ended September 30, 2023, 2022, and 2021 was as follows:


	2023		2022		2021
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	36,038	$	38,709	$	50,299
Financing cash flows from financing leases	$	536	$	297	$	354
Right-of-use assets obtained in exchange for new lease obligations:
Operating leases(1)	$	28,257	$	15,431	$	9,576
Financing leases(2)	$	40	$	—	$	1,146

(1)

In the year ended September 30, 2023, operating lease additions included $4.0 million related to the ServiceMax acquisition.

(2)

In the year ended September 30, 2023, all financing lease additions related to the ServiceMax acquisition.

Supplemental balance sheet information related to the leases as of September 30, 2023 and 2022 was as follows:


	2023			2022
Weighted-average remaining lease term - operating leases	10.9 years			11.8 years
Weighted-average remaining lease term - financing leases	1 year			2 years
Weighted-average discount rate - operating leases		5.2	%		5.4	%
Weighted-average discount rate - financing leases		3.7	%		3.0	%

Maturities of lease liabilities as of September 30, 2023 are as follows:


(in thousands)	Operating Leases
2024	$	34,247
2025		28,490
2026		23,523
2027		19,738
2028		17,874
Thereafter		134,033
Total future lease payments		257,905
Less: imputed interest		(64,713	)
Total lease liability	$	193,192

As of September 30, 2023, we had operating leases that had not yet commenced. The leases will commence in 2024 with a lease term of 7.75 years and we will make future lease payments of approximately $2.4 million.