Leases

9 Months Ended

Sep. 30, 2019

Leases [Abstract]

Leases

12. Leases

The Company leases office space under non-cancelable operating leases with lease terms ranging from one to ten years. These leases require monthly lease payments that may be subject to annual increases throughout the lease term. Certain of these leases also include renewal options at the election of the Company to renew or extend the lease for an additional three to five years. These optional periods have not been considered in the determination of the right-of-use assets or lease liabilities associated with these leases as the Company did not consider it reasonably certain it would exercise the options. The Company subleases one of its locations. The sublease term has 15 months remaining and will expire in 2020. This sublease has no option for renewal.

The Company performed evaluations of its contracts and determined that each of its identified leases are operating leases. The components of operating lease expense were as follows:

	Three months ended September 30,					Nine months ended September 30,
	2019			2018		2019			2018
	(in thousands)
Operating lease cost, gross	$	2,139		$	1,780	$	6,311		$	5,525
Variable lease cost, gross(1)		806			—		2,135			—
Sublease income		(145	)		—		(290	)		—
Total lease costs(2)	$	2,800		$	1,780	$	8,156		$	5,525

(1) Variable rent expense was not included within the measurement of the Company's operating right-of-use assets and lease liabilities. Variable rent expense is comprised primarily of the Company's proportionate share of operating expenses, property taxes and insurance and is classified as lease expense due to the Company's election to not separate lease and non-lease components.

(2) Short-term lease costs for the three and nine months ended September 30, 2019 were not significant and are not included in the table above.

Cash paid for amounts included in the measurement of operating lease liabilities for the nine months ended September 30, 2019 was $6,816,000 and was included in net cash provided by operating activities in the consolidated statements of cash flows. Right-of-use assets obtained in exchange for lease obligations for the nine months ended September 30, 2019 was $6,068,000.

As of September 30, 2019, the maturities of the Company's operating lease liabilities were as follows (in thousands): 

2019 (excluding the nine months ended September 30, 2019)	$	2,395
2020		9,507
2021		8,925
2022		9,318
2023		8,769
Thereafter		23,620
Total lease payments		62,534
Less:
Imputed interest		(13,525	)
Lease liabilities		49,009
Tenant improvement reimbursements included in the measurement of lease liabilities but not yet received		(1,113	)
Lease liabilities, net		47,896

As of September 30, 2019, the weighted average remaining lease term is 6.8 years and the weighted average discount rate used to determine operating lease liabilities was 7.14%.