Leases

12 Months Ended

Dec. 31, 2021

Operating Leases – The Company leases office space under non-cancelable lease agreements, which expire on various dates through 2035. The lease terms include options to extend the lease when it is reasonably certain that the Company will exercise that option. The Company reflects lease expense over the lease terms on a straight-line basis. Occupancy lease agreements, in addition to base rentals, generally are subject to escalation provisions based on certain costs incurred by the landlord. The Company does not have any leases with variable lease payments. Occupancy and Equipment Rental on the Consolidated Statements of Operations includes operating lease cost for office space of $49,580, $48,561 and $41,257 for the years ended December 31, 2021, 2020 and 2019, respectively, and variable lease cost, which principally include costs for real estate taxes, common area maintenance and other operating expenses, of $6,062, $7,490 and $8,474 for the years ended December 31, 2021, 2020 and 2019, respectively.

On June 10, 2021, the Company entered into lease agreements to take on an additional 14 rentable square feet at its 1 Stanhope Gate office in London, U.K. The approximate additional annual expense under these lease agreements, net of certain lease incentives, is £1,081 and the lease term is June 10, 2021 through March 24, 2027.

In conjunction with its lease agreements at 55 East 52nd St., New York, New York, the Company had an option to take on an additional 30 rentable square feet of office space, which it exercised during 2021. The Company anticipates that it will take possession of this space during 2023. The expected approximate additional annual expense under this lease agreement, net of certain lease incentives, is $2,200 and the lease term will end on December 31, 2035.

In conjunction with the lease of office space, the Company has entered into letters of credit in the amounts of $5,616 and $5,550 as of December 31, 2021 and 2020, respectively, which are secured by cash that is included in Other Assets on the Consolidated Statements of Financial Condition.

The Company has entered into various operating leases for the use of office equipment (primarily computers, printers, copiers and other information technology related equipment). Occupancy and Equipment Rental on the Consolidated Statements of Operations includes operating lease cost for office equipment of $5,193, $4,709 and $4,107 for the years ended December 31, 2021, 2020 and 2019, respectively.

The Company uses its secured incremental borrowing rate to determine the present value of its right-of-use assets and lease liabilities. The determination of an appropriate incremental borrowing rate requires significant assumptions and judgment. The Company's incremental borrowing rate was calculated based on the Company's recent debt issuances and current market conditions. The Company scales the rates appropriately depending on the life of the leases.

The Company incurred net operating cash outflows of $45,886, $30,709 and $20,175 for the years ended December 31, 2021, 2020 and 2019, respectively, related to its operating leases, which was net of cash received from lease incentives of $9,216, $14,732 and $18,771 for the years ended December 31, 2021, 2020 and 2019, respectively.

Other information as it relates to the Company's operating leases is as follows:


	For the Years Ended December 31,
		2021			2020
New Right-of-Use Assets obtained in exchange for new operating lease liabilities		$	34,544		$	112,215

		December 31,
		2021			2020
Weighted-average remaining lease term - operating leases		10.8 years			11.4 years
Weighted-average discount rate - operating leases		3.92		%	4.08		%

As of December 31, 2021, the maturities of the undiscounted operating lease liabilities for which the Company has commenced use are as follows:


2022	$	59,003
2023	44,699
2024	36,964
2025	38,819
2026	38,701
Thereafter	215,615
Total lease payments	433,801
Less: Tenant Improvement Allowances	(6,281)
Less: Imputed Interest	(82,726)
Present value of lease liabilities	344,794
Less: Current lease liabilities	(47,321)
Long-term lease liabilities	$	297,473

In conjunction with the lease agreement to expand its headquarters at 55 East 52nd St., New York, New York, and lease agreements at certain other locations, the Company entered into leases for office space which have not yet commenced and thus are not yet included on the Company's Consolidated Statements of Financial Condition as right-of-use assets and lease liabilities. The Company anticipates that it will take possession of these spaces by the end of 2023. These spaces will have lease terms of 1 to 13 years once the Company has taken possession. The additional future payments under these arrangements are $232,267 as of December 31, 2021.