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Leases

12 Months Ended

Dec. 31, 2022

LeasesWe lease office space, office equipment and technology under various operating and financing leases. Our current leases have remaining lease terms of one year to 15 years, some of which include options to extend the leases for up to five years, and some of which include options to terminate the leases within one year. Since 2010, we have sub-leased over one million square feet of office space.

Leases included in the consolidated statements of financial condition as of December 31, 2022 and 2021 were as follows:


	Classification	December 31, 2022			December 31, 2021
	(in thousands)
Operating Leases
Operating lease right-of-use assets	Right-of-use assets		$	360,092		$	414,105
Operating lease liabilities	Lease liabilities		415,539			482,781
Finance Leases
Property and equipment, gross	Right-of-use assets		18,116			10,947
Amortization of right-of-use assets	Right-of-use assets		(6,310)			(3,072)
Property and equipment, net			11,806			7,875
Finance lease liabilities	Lease liabilities		11,940			7,954

The components of lease expense included in the consolidated statements of income for the years ended December 31, 2022 and 2021 were as follows:


		Years Ended December 31
	Classification	2022			2021
		(in thousands)
Operating lease cost	General and administrative		$	97,198		$	97,466

Financing lease cost:
Amortization of right-of-use assets	General and administrative		3,860			2,355
Interest on lease liabilities	Interest expense		200			107
Total finance lease cost			4,060			2,462
Variable lease cost (1)	General and administrative		40,552			39,827
Sublease income	General and administrative		(34,420)			(37,317)
Net lease cost			$	107,390		$	102,438

(1)Variable lease expense includes operating expenses, real estate taxes and employee parking.

The sublease income represents all revenues received from sub-tenants. It is primarily fixed base rental payments combined with variable reimbursements such as operating expenses, real estate taxes and employee parking. The vast majority of sub-tenant income is derived from our New York metro sub-tenant agreements. Sub-tenant income related to base rent is recorded on a straight-line basis.

Maturities of lease liabilities are as follows:


	Operating Leases			Financing Leases			Total
Year ending December 31,	(in thousands)
2023		$	97,489		$	4,169		$	101,658
2024		104,596			3,258			107,854
2025		37,319			2,828			40,147
2026		35,808			1,810			37,618
2027		32,821			324			33,145
Thereafter		146,319			—			146,319
Total lease payments		454,352			12,389			$	466,741
Less interest		(38,813)			(449)
Present value of lease liabilities		$	415,539		$	11,940

We have signed a lease that commences in 2024, relating to approximately 166,000 square feet of space in New York City. Our estimated total base rent obligation (excluding taxes, operating expenses and utilities) over the 20-year lease term is approximately $393.0 million.


Lease term and discount rate:
Weighted average remaining lease term (years):
Operating leases	7.35
Finance leases	3.47
Weighted average discount rate:
Operating leases	2.69	%
Finance leases	2.10	%

Supplemental non-cash activity related to leases are as follows:


	Years Ended December 31
	2022			2021
	(in thousands)




Right-of-use assets obtained in exchange for lease obligations(1):
Operating leases		$	38,875		$	82,379
Finance leases		7,791			7,782

(1)Represents

Leases