COPT Defense Properties Quarterly report pursuant to Section 13 or 15(d)

Leases (Tables)

3 Months Ended

Mar. 31, 2020

The table below sets forth our allocation of lease revenue recognized between fixed and variable lease revenue (in thousands):



	For the Three Months Ended March 31,
Lease revenue	2020		2019
Fixed	$	104,109	$	104,644
Variable	26,903		26,259
	$	131,012	$	130,903

Fixed contractual payments due under our property leases were as follows (in thousands):

(1) As of March 31, 2020, represents the nine months ending December 31, 2020

Our right-of-use assets consisted of the following (in thousands):



Leases	Balance Sheet Location	March 31, 2020		December 31, 2019
Right-of-use assets
Operating leases - Property	Property - operating right-of-use assets	$	27,793	$	27,864
Finance leases - Property	Property - finance right-of-use assets	40,450		40,458
Total right-of-use assets		$	68,243	$	68,322

Lease liabilities consisted of the following (in thousands):



Leases	Balance Sheet Location	March 31, 2020		December 31, 2019
Lease liabilities
Operating leases - Property	Property - operating lease liabilities	$	17,365	$	17,317
Finance leases - Property	Other liabilities	702		702
Total lease liabilities		$	18,067	$	18,019

The table below sets forth the weighted average terms and discount rates of our leases as of March 31, 2020:



Weighted average remaining lease term
Operating leases	68 years
Finance leases	< 1 year
Weighted average discount rate
Operating leases	7.33	%
Finance leases	3.62	%

The table below presents our total lease cost (in thousands):



		For the Three Months Ended March 31,
Lease cost	Statement of Operations Location	2020		2019
Operating lease cost
Property leases	Property operating expenses	$	431	$	413
Finance lease cost
Amortization of property right-of-use assets	Property operating expenses	9		—
		$	440	$	413

The table below presents the effect of lease payments on our consolidated statements of cash flows (in thousands):



	For the Three Months Ended March 31,
Supplemental cash flow information	2020		2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases	$	311	$	228
Financing cash flows for financing leases	$	—	$	52

Payments on leases as of March 31, 2020 and December 31, 2019 were due as follows (in thousands):



	As of March 31, 2020								As of December 31, 2019
Year Ending December 31,	Operating leases			Finance leases		Total			Operating leases			Finance leases		Total
2020 (1)	$	826		$	674	$	1,500		$	1,092		$	674	$	1,766
2021	1,138			14		1,152			1,138			14		1,152
2022	1,162			14		1,176			1,162			14		1,176
2023	1,167			—		1,167			1,167			—		1,167
2024	1,173			—		1,173			1,173			—		1,173
Thereafter	100,609			—		100,609			100,609			—		100,609
Total lease payments	106,075			702		106,777			106,341			702		107,043
Less: Amount representing interest	(88,710		)	—		(88,710		)	(89,024		)	—		(89,024		)
Lease liability	$	17,365		$	702	$	18,067		$	17,317		$	702	$	18,019

(1) As of March 31, 2020, represents the nine months ending December 31, 2020.



	As of March 31, 2020								As of December 31, 2019
Year Ending December 31,	Operating leases			Finance leases		Total			Operating leases			Finance leases		Total
2020 (1)	$	826		$	674	$	1,500		$	1,092		$	674	$	1,766
2021	1,138			14		1,152			1,138			14		1,152
2022	1,162			14		1,176			1,162			14		1,176
2023	1,167			—		1,167			1,167			—		1,167
2024	1,173			—		1,173			1,173			—		1,173
Thereafter	100,609			—		100,609			100,609			—		100,609
Total lease payments	106,075			702		106,777			106,341			702		107,043
Less: Amount representing interest	(88,710		)	—		(88,710		)	(89,024		)	—		(89,024		)
Lease liability	$	17,365		$	702	$	18,067		$	17,317		$	702	$	18,019

(1) As of March 31, 2020, represents the nine months ending December 31, 2020.