Leases

6 Months Ended

Jun. 30, 2022

Leases [Abstract]

Leases

Leases

We have operating leases for our corporate and division offices, production facilities, model homes, and certain office and production equipment. Additionally, we have finance leases for certain plant equipment and one of our production facilities which are recorded in homebuilding "Property, plant and equipment, net" and "Accrued expenses and other liabilities" on the accompanying condensed consolidated balance sheets. Our finance lease ROU assets and finance lease liabilities were $14,364 and $15,413, respectively, as of June 30, 2022, and $14,578 and $15,413, respectively, as of December 31, 2021. Our leases have remaining lease terms of up to 18.2 years, some of which include options to extend the lease for up to 20 years, and some of which include options to terminate the lease.

We recognize operating lease expense on a straight-line basis over the lease term. We have elected to use the portfolio approach for certain equipment leases which have similar lease terms and payment schedules. Additionally, for certain equipment we account for the lease and non-lease components as a single lease component. Our sublease income is de minimis.

We have certain leases, primarily the leases of model homes, which have initial lease terms of twelve months or less ("Short-term leases"). We elected to exclude these leases from the recognition requirements under Topic 842, and these leases have not been included in our recognized ROU assets and lease liabilities.

The components of lease expense were as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Lease expense
Operating lease expense	$	8,529	$	7,911	$	16,630	$	15,488
Finance lease expense:
Amortization of ROU assets	473		445		937		888
Interest on lease liabilities	103		108		207		217
Short-term lease expense	6,491		5,861		12,823		11,751
Total lease expense	$	15,596	$	14,325	$	30,597	$	28,344

Other information related to leases was as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022			2021
Supplemental Cash Flows Information:
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	6,935	$	6,878	$	14,104		$	13,688
Operating cash flows from finance leases	103		108		207			217
Financing cash flows from finance leases	367		331		723			661
ROU assets obtained in exchange for lease obligations:
Operating leases	$	18,073	$	16,558	$	23,886		$	19,571
Finance leases	$	451	$	—	$	723		$	89
					June 30, 2022			December 31, 2021
Weighted-average remaining lease term (in years):
Operating leases					6.2			6.3
Finance leases					11.2			11.7
Weighted-average discount rate:
Operating leases					3.1		%	3.0		%
Finance leases					2.8		%	2.8		%

Leases

Leases

We have operating leases for our corporate and division offices, production facilities, model homes, and certain office and production equipment. Additionally, we have finance leases for certain plant equipment and one of our production facilities which are recorded in homebuilding "Property, plant and equipment, net" and "Accrued expenses and other liabilities" on the accompanying condensed consolidated balance sheets. Our finance lease ROU assets and finance lease liabilities were $14,364 and $15,413, respectively, as of June 30, 2022, and $14,578 and $15,413, respectively, as of December 31, 2021. Our leases have remaining lease terms of up to 18.2 years, some of which include options to extend the lease for up to 20 years, and some of which include options to terminate the lease.

We recognize operating lease expense on a straight-line basis over the lease term. We have elected to use the portfolio approach for certain equipment leases which have similar lease terms and payment schedules. Additionally, for certain equipment we account for the lease and non-lease components as a single lease component. Our sublease income is de minimis.

We have certain leases, primarily the leases of model homes, which have initial lease terms of twelve months or less ("Short-term leases"). We elected to exclude these leases from the recognition requirements under Topic 842, and these leases have not been included in our recognized ROU assets and lease liabilities.

The components of lease expense were as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Lease expense
Operating lease expense	$	8,529	$	7,911	$	16,630	$	15,488
Finance lease expense:
Amortization of ROU assets	473		445		937		888
Interest on lease liabilities	103		108		207		217
Short-term lease expense	6,491		5,861		12,823		11,751
Total lease expense	$	15,596	$	14,325	$	30,597	$	28,344

Other information related to leases was as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022			2021
Supplemental Cash Flows Information:
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	6,935	$	6,878	$	14,104		$	13,688
Operating cash flows from finance leases	103		108		207			217
Financing cash flows from finance leases	367		331		723			661
ROU assets obtained in exchange for lease obligations:
Operating leases	$	18,073	$	16,558	$	23,886		$	19,571
Finance leases	$	451	$	—	$	723		$	89
					June 30, 2022			December 31, 2021
Weighted-average remaining lease term (in years):
Operating leases					6.2			6.3
Finance leases					11.2			11.7
Weighted-average discount rate:
Operating leases					3.1		%	3.0		%
Finance leases					2.8		%	2.8		%