Equipment, net and construction in progress

6 Months Ended

Jun. 30, 2015

Equipment, net and construction in progress [Abstract]

Equipment, net and construction in progress

4. Equipment, net and construction in progress

At June 30, 2015 and December 31, 2014, equipment, furniture and fixtures, and construction in progress were comprised of the following (in thousands):

	June 30, 2015 (Unaudited)		December 31, 2014
Equipment, furniture and fixtures	$	5,196	$	4,871
Construction in progress		3,415		406
Accumulated depreciation		(2,959)		(2,419)
Equipment, net and construction in progress	$	5,652	$	2,858

Equipment, furniture and fixtures, and construction in progress at June 30, 2015 include $115,000 financed by capital lease borrowings in June 2014 and $3.4 million of construction in progress for Asterias’ Fremont facility. Depreciation expense amounted to $512,000 and $523,000 for the six months ended June 30, 2015 and 2014, respectively. The difference between the depreciation expense recognized in the consolidated statement of operations and the increase in accumulated depreciation of $541,000 in the consolidated balance sheet is partially attributed to the sale of partially depreciated assets and foreign currency rates.

Construction in progress

Construction in progress of $3.4 million as of June 30, 2015 entirely relates to the improvements for Asterias' Fremont facility. Under the terms of the lease agreement, the landlord has provided Asterias with a tenant improvement allowance of $4.4 million, which Asterias is using to construct a laboratory and production facility that can be used to produce human embryonic stem cell and related products under cGMP. Of the $3.4 million, $3.3 million qualifies for reimbursement under the tenant improvement allowance. As of June 30, 2015, we received $560,000 from the landlord. The facility is expected to be substantially completed and placed into service in the third quarter of 2015.