Property and Equipment, net

3 Months Ended

Mar. 31, 2015

Property and Equipment, net

Property and Equipment, net

4.Property and Equipment, net

Property and equipment consisted of the following at March 31, 2015 and December 31, 2014 (in thousands):

	March 31,		December 31,
	2015		2014
Computer equipment, software, and internally developed software	$	40,507	$	37,110
Furniture and fixtures		2,654		2,335
Leasehold improvements		5,926		4,611
Capitalized facility leases		29,256		6,599
		78,343		50,655
Less: Accumulated depreciation		(22,216)		(19,924)
Total property and equipment, net	$	56,127	$	30,731

The Company is considered the owner, for accounting purposes only, of one of its Santa Monica, California leased office spaces and of its San Francisco, California leased office space (collectively, the “Premises”) as it has taken on certain risks of construction build cost overages above normal tenant improvement allowances. Accordingly, at March 31, 2015 and December 31, 2014, the Company has capitalized $29.3 million and $6.6 million, respectively, related to the Premises, which represents the estimated fair value of the leased properties and additions for capitalized interest incurred during the construction periods and capitalized costs related to structural improvements to the building. For the three months ended March 31, 2015, the Company capitalized approximately $0.7 million of interest costs related to the Premises. Additionally, at March 31, 2015 and December 31, 2014, the Company recognized a corresponding lease financing obligation of approximately $28.3 million and $6.6 million, respectively. Refer to Note 7 for additional information. Normal leasehold improvements related to the facilities are recorded in leasehold improvements in the table above.

Included in the table above are property and equipment of $23.2 million and $8.1 million at March 31, 2015 and December 31, 2014, respectively, which are capitalizable, but had not yet been placed in service. The $23.2 million balance at March 31, 2015 was comprised primarily of the Santa Monica capitalized facility lease of $22.2 million. The $8.1 million balance at December 31, 2014 was comprised primarily of the San Francisco capitalized facility lease of $6.6 million.

Total depreciation and amortization expense of property and equipment was $2.9 million and $2.0 million for the three months ended March 31, 2015 and 2014, respectively.

Amortization of internal use capitalized software development costs was $1.9 million and $1.1 million for the three months ended March 31, 2015 and 2014, respectively.