| Leases |
8. LEASES
The Company’s operating leases are primarily for office real estate. The leases have remaining lease terms ranging from one year to 10 years and may include options to extend or terminate.
The components of lease expense are as follows (in thousands):
|
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
|
|
|
September 30, 2020 |
|
|
September 30, 2019 |
|
|
September 30, 2020 |
|
|
September 30, 2019 |
|
|
Operating lease cost (1) |
|
$ |
13,314 |
|
|
$ |
9,233 |
|
|
$ |
42,436 |
|
|
$ |
21,453 |
|
|
Sublease income |
|
|
(284 |
) |
|
|
(664 |
) |
|
|
(1,969 |
) |
|
|
(1,790 |
) |
|
Net operating lease cost |
|
$ |
13,030 |
|
|
$ |
8,569 |
|
|
$ |
40,467 |
|
|
$ |
19,663 |
|
|
|
(1) |
For the three and nine months ended September 30, 2020, variable lease costs were $2.9 million and $8.4 million, respectively. For the three and nine months ended September 30, 2019, variable lease costs were $1.3 million and $3.3 million, respectively. Variable lease costs primarily include common area maintenance charges. |
Supplemental cash flow information related to leases is as follows (in thousands):
|
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
|
|
|
September 30, 2020 |
|
|
September 30, 2019 |
|
|
September 30, 2020 |
|
|
September 30, 2019 |
|
|
Cash paid for amounts included in the measurement of lease liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating cash outflows from operating leases |
|
$ |
6,320 |
|
|
$ |
4,892 |
|
|
$ |
21,504 |
|
|
$ |
12,332 |
|
|
Right-of-use assets obtained in exchange for lease obligations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating leases |
|
$ |
3,690 |
|
|
$ |
32,014 |
|
|
$ |
6,461 |
|
|
$ |
115,794 |
|
Supplemental balance sheet information related to leases was as follows (in thousands, except lease term and discount rate):
|
|
|
As of |
|
|
|
|
September 30, 2020 |
|
|
December 31, 2019 |
|
|
Operating lease right-of-use assets |
|
$ |
267,094 |
|
|
$ |
283,291 |
|
|
Included in accounts payable and accrued liabilities: |
|
|
|
|
|
|
|
|
|
Operating lease liability, current |
|
|
32,130 |
|
|
|
17,896 |
|
|
Operating lease liability, non-current |
|
|
311,072 |
|
|
|
301,694 |
|
|
Total operating lease liability |
|
$ |
343,202 |
|
|
$ |
319,590 |
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average remaining lease term |
|
|
|
|
|
|
|
|
|
Operating leases (in years) |
|
9.35 |
|
|
9.98 |
|
|
Weighted average discount rate |
|
|
|
|
|
|
|
|
|
Operating leases |
|
|
4.64 |
% |
|
|
4.65 |
% |
Future lease payments under operating leases as of September 30, 2020 were as follows (in thousands):
|
Year ending December 31, |
|
Operating
Leases |
|
|
2020 (remaining 3 months) |
|
$ |
9,545 |
|
|
2021 |
|
|
48,695 |
|
|
2022 |
|
|
45,839 |
|
|
2023 |
|
|
46,520 |
|
|
2024 |
|
|
45,727 |
|
|
Thereafter |
|
|
247,011 |
|
|
Total future lease payments |
|
|
443,337 |
|
|
Less: imputed interest |
|
|
(84,680 |
) |
|
Less: expected tenant improvement allowance |
|
|
(15,455 |
) |
|
Total |
|
$ |
343,202 |
|
As of September 30, 2020, the Company has additional operating leases, primarily corporate offices, that have not yet commenced of $7.0 million. These operating leases commence in future periods beginning in the last quarter of fiscal year 2020 and have lease terms of four to five years.
|