Lease Agreements - Company as Lessee

12 Months Ended

Dec. 31, 2023

As of December 31, 2023, the Company is a lessee of corporate office space, ground leases and a parking lease associated with various consolidated properties, and equipment. Lease terms for the Company's office leases, in general, range between 5 to 10 years while ground leases and the parking lease have terms typically ranging from 20 to 85 years. The corporate office leases occasionally contain renewal options of approximately five years while certain ground leases contain renewal options that can extend the lease term from approximately 10 to 39 years.

A majority of the Company’s ground leases and the parking lease are subject to changes in the Consumer Price Index ("CPI"). Furthermore, certain of the Company’s ground leases include rental payments based on a percentage of gross or net income. While lease liabilities are not remeasured as a result of changes in the CPI or percentage of gross or net income, such changes are treated as variable lease payments and recognized in the period in which the obligation for those payments was incurred.

The Company’s lease agreements do not contain any residual value guarantees or restrictive covenants.

Operating lease right-of-use assets and operating lease liabilities are recognized based on the present value of lease payments over the lease term at commencement date. Because most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.

As of December 31, 2023 and 2022, the Company had no material finance leases.

Supplemental consolidated balance sheet information related to leases as of December 31, 2023 and 2022 is as follows ($ in thousands):


	Classification	December 31, 2023		December 31, 2022
Assets
Operating lease right-of-use assets	Operating lease right-of-use assets	$	63,757	$	67,239

Total leased assets		$	63,757	$	67,239

Liabilities
Operating lease liabilities	Operating lease liabilities	$	65,091	$	68,696

Total lease liabilities		$	65,091	$	68,696

The components of lease expense for the years ended December 31, 2023 and 2022 were as follows ($ in thousands):


	December 31, 2023		December 31, 2022
Operating lease cost	$	6,789	$	6,697
Variable lease cost	1,961		1,750



Short-term lease cost	186		204
Sublease income	(500)		(418)
Total lease cost	$	8,436	$	8,233

A maturity analysis of lease liabilities as of December 31, 2023 is as follows ($ in thousands):


	Operating Leases
2024	$	7,251
2025	6,887
2026	5,035
2027	3,421
2028	3,102
Thereafter	129,452
Total lease payments	$	155,148
Less: Imputed interest	(90,057)
Present value of lease liabilities	$	65,091

Lease term and discount rate information for leases at December 31, 2023 and 2022 are as follows:


	December 31, 2023		December 31, 2022
Weighted-average of remaining lease terms (years)
Operating Leases	40		40

Weighted-average of discount rates
Operating Leases	5.03	%	5.01	%

Practical Expedients

Leases with an initial term of 12 months or less are not recorded on the balance sheet. The Company recognizes the lease expense for such leases on a straight-line basis over the lease term.

The Company has elected to account for lease components (e.g., fixed payments including rent) and non-lease components (e.g., common-area maintenance costs) as a single combined lease component as the lease components are the predominant elements of the combined components.