Quarterly report pursuant to Section 13 or 15(d)

Leases

v3.23.3
Leases
 9 Months Ended
Sep. 30, 2023
Leases [Abstract]  
Leases Leases
Lessor Arrangements

We lease real estate properties, comprised primarily of office properties and data center shells, to third parties. These leases encompass all, or a portion, of properties, with various expiration dates. Our lease revenue is comprised of: fixed lease revenue, including contractual rent billings under leases recognized on a straight-line basis over lease terms and amortization of lease incentives and above- and below- market lease intangibles; and variable lease revenue, including tenant expense recoveries, lease termination revenue and other revenue from tenants that is not fixed under leases. The table below sets forth our composition of lease revenue recognized between fixed and variable lease revenue (in thousands):
For the Three Months Ended September 30, For the Nine Months Ended September 30,
Lease revenue (1) 2023 2022 2023 2022
Fixed $ 120,408  $ 113,700  $ 354,908  $ 337,558 
Variable 34,860  32,781  104,602  92,589 
$ 155,268  $ 146,481  $ 459,510  $ 430,147 
(1)Excludes lease revenue from discontinued operations of which $1.5 million was fixed and $527,000 was variable for the nine months ended September 30, 2022.

Lessee Arrangements

As of September 30, 2023, our balance sheet included $43.1 million in right-of-use assets associated primarily with land leased from third parties underlying certain properties that we are operating with various expiration dates. Our property right-of-use assets and property lease liabilities on our consolidated balance sheets consisted of the following (in thousands):
Leases Balance Sheet Location September 30,
2023		 December 31,
2022
Right-of-use assets
Operating leases - Property Property - operating right-of-use assets $ 40,487  $ 37,020 
Finance leases - Property Prepaid expenses and other assets, net 2,584  2,207 
Total right-of-use assets $ 43,071  $ 39,227 
Lease liabilities
Operating leases - Property Property - operating lease liabilities $ 32,940  $ 28,759 
Finance leases - Property Other liabilities 420  — 
Total lease liabilities $ 33,360  $ 28,759 

As of September 30, 2023, our operating leases had a weighted average remaining lease term of 48 years and a weighted average discount rate of 7.31%, while our finance leases had a weighted average remaining lease term of nine years and a weighted average discount rate of 9.14%. The table below presents our total property lease costs (in thousands):
Statement of Operations Location For the Three Months Ended September 30, For the Nine Months Ended September 30,
Lease cost 2023 2022 2023 2022
Operating lease cost
Property leases - fixed Property operating expenses $ 1,808  $ 1,031  $ 5,146  $ 3,082 
Property leases - variable Property operating expenses 17  16  50  49 
Finance lease cost
Amortization of property right-of-use assets Property operating expenses 18  7  57  23 
Interest on lease liabilities Interest expense 10  —  33  — 
$ 1,853  $ 1,054  $ 5,286  $ 3,154 
The table below presents the effect of property lease payments on our consolidated statements of cash flows (in thousands):
For the Nine Months Ended September 30,
Supplemental cash flow information 2023 2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases $ 4,432  $ 2,515 
Operating cash flows for financing leases $ 33  $ — 
Financing cash flows for financing leases $ 14  $ — 

Payments on property leases were due as follows (in thousands):
September 30, 2023
Year Ending December 31, Operating Leases Finance Leases
2023 (1)
 $ 1,624  $ 15 
2024 6,633  61 
2025 2,250  63 
2026 1,662  65 
2027 1,677  66 
Thereafter 130,495  366 
Total lease payments 144,341  636 
Less: Amount representing interest (111,401) (216)
Lease liability $ 32,940  $ 420 
(1)Represents the three months ending December 31, 2023.
Leases Leases
Lessor Arrangements

We lease real estate properties, comprised primarily of office properties and data center shells, to third parties. These leases encompass all, or a portion, of properties, with various expiration dates. Our lease revenue is comprised of: fixed lease revenue, including contractual rent billings under leases recognized on a straight-line basis over lease terms and amortization of lease incentives and above- and below- market lease intangibles; and variable lease revenue, including tenant expense recoveries, lease termination revenue and other revenue from tenants that is not fixed under leases. The table below sets forth our composition of lease revenue recognized between fixed and variable lease revenue (in thousands):
For the Three Months Ended September 30, For the Nine Months Ended September 30,
Lease revenue (1) 2023 2022 2023 2022
Fixed $ 120,408  $ 113,700  $ 354,908  $ 337,558 
Variable 34,860  32,781  104,602  92,589 
$ 155,268  $ 146,481  $ 459,510  $ 430,147 
(1)Excludes lease revenue from discontinued operations of which $1.5 million was fixed and $527,000 was variable for the nine months ended September 30, 2022.

Lessee Arrangements

As of September 30, 2023, our balance sheet included $43.1 million in right-of-use assets associated primarily with land leased from third parties underlying certain properties that we are operating with various expiration dates. Our property right-of-use assets and property lease liabilities on our consolidated balance sheets consisted of the following (in thousands):
Leases Balance Sheet Location September 30,
2023		 December 31,
2022
Right-of-use assets
Operating leases - Property Property - operating right-of-use assets $ 40,487  $ 37,020 
Finance leases - Property Prepaid expenses and other assets, net 2,584  2,207 
Total right-of-use assets $ 43,071  $ 39,227 
Lease liabilities
Operating leases - Property Property - operating lease liabilities $ 32,940  $ 28,759 
Finance leases - Property Other liabilities 420  — 
Total lease liabilities $ 33,360  $ 28,759 

As of September 30, 2023, our operating leases had a weighted average remaining lease term of 48 years and a weighted average discount rate of 7.31%, while our finance leases had a weighted average remaining lease term of nine years and a weighted average discount rate of 9.14%. The table below presents our total property lease costs (in thousands):
Statement of Operations Location For the Three Months Ended September 30, For the Nine Months Ended September 30,
Lease cost 2023 2022 2023 2022
Operating lease cost
Property leases - fixed Property operating expenses $ 1,808  $ 1,031  $ 5,146  $ 3,082 
Property leases - variable Property operating expenses 17  16  50  49 
Finance lease cost
Amortization of property right-of-use assets Property operating expenses 18  7  57  23 
Interest on lease liabilities Interest expense 10  —  33  — 
$ 1,853  $ 1,054  $ 5,286  $ 3,154 
The table below presents the effect of property lease payments on our consolidated statements of cash flows (in thousands):
For the Nine Months Ended September 30,
Supplemental cash flow information 2023 2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases $ 4,432  $ 2,515 
Operating cash flows for financing leases $ 33  $ — 
Financing cash flows for financing leases $ 14  $ — 

Payments on property leases were due as follows (in thousands):
September 30, 2023
Year Ending December 31, Operating Leases Finance Leases
2023 (1)
 $ 1,624  $ 15 
2024 6,633  61 
2025 2,250  63 
2026 1,662  65 
2027 1,677  66 
Thereafter 130,495  366 
Total lease payments 144,341  636 
Less: Amount representing interest (111,401) (216)
Lease liability $ 32,940  $ 420 
(1)Represents the three months ending December 31, 2023.
Leases Leases
Lessor Arrangements

We lease real estate properties, comprised primarily of office properties and data center shells, to third parties. These leases encompass all, or a portion, of properties, with various expiration dates. Our lease revenue is comprised of: fixed lease revenue, including contractual rent billings under leases recognized on a straight-line basis over lease terms and amortization of lease incentives and above- and below- market lease intangibles; and variable lease revenue, including tenant expense recoveries, lease termination revenue and other revenue from tenants that is not fixed under leases. The table below sets forth our composition of lease revenue recognized between fixed and variable lease revenue (in thousands):
For the Three Months Ended September 30, For the Nine Months Ended September 30,
Lease revenue (1) 2023 2022 2023 2022
Fixed $ 120,408  $ 113,700  $ 354,908  $ 337,558 
Variable 34,860  32,781  104,602  92,589 
$ 155,268  $ 146,481  $ 459,510  $ 430,147 
(1)Excludes lease revenue from discontinued operations of which $1.5 million was fixed and $527,000 was variable for the nine months ended September 30, 2022.

Lessee Arrangements

As of September 30, 2023, our balance sheet included $43.1 million in right-of-use assets associated primarily with land leased from third parties underlying certain properties that we are operating with various expiration dates. Our property right-of-use assets and property lease liabilities on our consolidated balance sheets consisted of the following (in thousands):
Leases Balance Sheet Location September 30,
2023		 December 31,
2022
Right-of-use assets
Operating leases - Property Property - operating right-of-use assets $ 40,487  $ 37,020 
Finance leases - Property Prepaid expenses and other assets, net 2,584  2,207 
Total right-of-use assets $ 43,071  $ 39,227 
Lease liabilities
Operating leases - Property Property - operating lease liabilities $ 32,940  $ 28,759 
Finance leases - Property Other liabilities 420  — 
Total lease liabilities $ 33,360  $ 28,759 

As of September 30, 2023, our operating leases had a weighted average remaining lease term of 48 years and a weighted average discount rate of 7.31%, while our finance leases had a weighted average remaining lease term of nine years and a weighted average discount rate of 9.14%. The table below presents our total property lease costs (in thousands):
Statement of Operations Location For the Three Months Ended September 30, For the Nine Months Ended September 30,
Lease cost 2023 2022 2023 2022
Operating lease cost
Property leases - fixed Property operating expenses $ 1,808  $ 1,031  $ 5,146  $ 3,082 
Property leases - variable Property operating expenses 17  16  50  49 
Finance lease cost
Amortization of property right-of-use assets Property operating expenses 18  7  57  23 
Interest on lease liabilities Interest expense 10  —  33  — 
$ 1,853  $ 1,054  $ 5,286  $ 3,154 
The table below presents the effect of property lease payments on our consolidated statements of cash flows (in thousands):
For the Nine Months Ended September 30,
Supplemental cash flow information 2023 2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases $ 4,432  $ 2,515 
Operating cash flows for financing leases $ 33  $ — 
Financing cash flows for financing leases $ 14  $ — 

Payments on property leases were due as follows (in thousands):
September 30, 2023
Year Ending December 31, Operating Leases Finance Leases
2023 (1)
 $ 1,624  $ 15 
2024 6,633  61 
2025 2,250  63 
2026 1,662  65 
2027 1,677  66 
Thereafter 130,495  366 
Total lease payments 144,341  636 
Less: Amount representing interest (111,401) (216)
Lease liability $ 32,940  $ 420 
(1)Represents the three months ending December 31, 2023.
Leases Leases
Lessor Arrangements

We lease real estate properties, comprised primarily of office properties and data center shells, to third parties. These leases encompass all, or a portion, of properties, with various expiration dates. Our lease revenue is comprised of: fixed lease revenue, including contractual rent billings under leases recognized on a straight-line basis over lease terms and amortization of lease incentives and above- and below- market lease intangibles; and variable lease revenue, including tenant expense recoveries, lease termination revenue and other revenue from tenants that is not fixed under leases. The table below sets forth our composition of lease revenue recognized between fixed and variable lease revenue (in thousands):
For the Three Months Ended September 30, For the Nine Months Ended September 30,
Lease revenue (1) 2023 2022 2023 2022
Fixed $ 120,408  $ 113,700  $ 354,908  $ 337,558 
Variable 34,860  32,781  104,602  92,589 
$ 155,268  $ 146,481  $ 459,510  $ 430,147 
(1)Excludes lease revenue from discontinued operations of which $1.5 million was fixed and $527,000 was variable for the nine months ended September 30, 2022.

Lessee Arrangements

As of September 30, 2023, our balance sheet included $43.1 million in right-of-use assets associated primarily with land leased from third parties underlying certain properties that we are operating with various expiration dates. Our property right-of-use assets and property lease liabilities on our consolidated balance sheets consisted of the following (in thousands):
Leases Balance Sheet Location September 30,
2023		 December 31,
2022
Right-of-use assets
Operating leases - Property Property - operating right-of-use assets $ 40,487  $ 37,020 
Finance leases - Property Prepaid expenses and other assets, net 2,584  2,207 
Total right-of-use assets $ 43,071  $ 39,227 
Lease liabilities
Operating leases - Property Property - operating lease liabilities $ 32,940  $ 28,759 
Finance leases - Property Other liabilities 420  — 
Total lease liabilities $ 33,360  $ 28,759 

As of September 30, 2023, our operating leases had a weighted average remaining lease term of 48 years and a weighted average discount rate of 7.31%, while our finance leases had a weighted average remaining lease term of nine years and a weighted average discount rate of 9.14%. The table below presents our total property lease costs (in thousands):
Statement of Operations Location For the Three Months Ended September 30, For the Nine Months Ended September 30,
Lease cost 2023 2022 2023 2022
Operating lease cost
Property leases - fixed Property operating expenses $ 1,808  $ 1,031  $ 5,146  $ 3,082 
Property leases - variable Property operating expenses 17  16  50  49 
Finance lease cost
Amortization of property right-of-use assets Property operating expenses 18  7  57  23 
Interest on lease liabilities Interest expense 10  —  33  — 
$ 1,853  $ 1,054  $ 5,286  $ 3,154 
The table below presents the effect of property lease payments on our consolidated statements of cash flows (in thousands):
For the Nine Months Ended September 30,
Supplemental cash flow information 2023 2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases $ 4,432  $ 2,515 
Operating cash flows for financing leases $ 33  $ — 
Financing cash flows for financing leases $ 14  $ — 

Payments on property leases were due as follows (in thousands):
September 30, 2023
Year Ending December 31, Operating Leases Finance Leases
2023 (1)
 $ 1,624  $ 15 
2024 6,633  61 
2025 2,250  63 
2026 1,662  65 
2027 1,677  66 
Thereafter 130,495  366 
Total lease payments 144,341  636 
Less: Amount representing interest (111,401) (216)
Lease liability $ 32,940  $ 420 
(1)Represents the three months ending December 31, 2023.