Property and Equipment

12 Months Ended

Dec. 31, 2017

Note 7. Property and Equipment

Property and equipment consists of the following:


	December 31,
	2017		2016
	(in thousands)
Office equipment	$	14,674	$	9,243
Laboratory equipment		48,807		37,203
Computer equipment		51,351		38,184
Land		5,350		4,125
Building and leasehold improvements		214,245		130,734
		334,427		219,489
Less accumulated depreciation and amortization		(74,664)		(51,810)
Property and equipment, net	$	259,763	$	167,679

Depreciation expense, including amortization expense of leasehold improvements, was $24.6 million, $14.2 million and $11.3 million for the years ended December 31, 2017, 2016 and 2015, respectively.

In April 2016, we completed our purchase of the previously leased land and building comprising approximately 190,000 square feet of laboratory and office space located in Wilmington, Delaware. We previously accounted for the lease as a direct financing arrangement. In total, upon completion of the purchase, we paid $81.3 million, including closing costs, for the purchase of the land and building and our direct financing obligation related to the lease was relieved. We recorded the difference between the amount paid for the purchase of the land and building ($81.3 million) and the remaining direct financing obligation on the purchase date ($45.9 million) as property and equipment. A total of $3.8 million was allocated to land and the remaining $31.6 million was allocated to buildings and leasehold improvements, which we estimated using the assistance of a third-party valuation specialist. The land is not being amortized and we are depreciating the building over its estimated useful life of 40 years. In addition, the restricted investments related to the direct financing lease were released upon closing of the agreement of sale.

In September 2016, we entered into two agreements to purchase two buildings at 1701 Augustine Cut-off in Wilmington, Delaware. The purchase closed in March 2017 for a total purchase price of approximately $8.1 million, consisting of $1.2 million of land and $6.9 million of buildings and leasehold improvements, which we estimated using the assistance of a third-party valuation specialist.

In October 2017, we completed the construction of a 154,000 square foot office building located in Wilmington, Delaware totaling approximately $91.3 million and are depreciating the building over its estimated useful life of 40 years.