LEASES

6 Months Ended

Jun. 30, 2020

The Company is a lessee to leases of corporate offices and certain office equipment. The majority of leases for corporate offices include one or more options to renew, with renewal terms ranging from two to five years. These renewal options have not been included in the calculation of right-of-use assets and lease liabilities, as the Company is not reasonably certain of the exercise of these renewal options. The Company used its incremental borrowing rate to calculate the right-of-use asset and lease liability for each lease.

As of June 30, 2020, right-of-use assets totaled $87.9 million and lease liabilities, the current portion of which is included in accrued expenses and other current liabilities in the accompanying balance sheet, totaled $92.6 million. At December 31, 2019, right-of-use assets totaled $25.5 million and lease liabilities totaled $28.2 million. During the second quarter of 2020 the right-of-use assets and lease liabilities increased $65.7 million due to commencement of the lease, as defined under ASC Topic 842, Leases, for the Company’s new principal executive offices currently under construction in Charlotte, North Carolina, occurring during the second quarter.

Lease expense, which is included in general and administrative expense on the accompanying consolidated statements of operations and comprehensive income, consists of the following (in thousands):



	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
Operating lease cost	$	2,140	$	1,467	$	3,994	$	2,730
Short-term lease cost	17		9		38		48
Total lease cost	$	2,157	$	1,476	$	4,032	$	2,778

Weighted average remaining lease term and discount rate for operating leases are as follows:



	June 30, 2020		December 31, 2019
Weighted average remaining lease term	14.0 years		5.0 years
Weighted average discount rate	5.0	%	4.7	%

Supplemental cash flow information related to leases is as follows (in thousands):



	Six Months Ended June 30,
	2020		2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	4,056	$	2,581
Right-of-use assets obtained in exchange for new operating lease liabilities	$	65,740	$	11,398

Maturities of lease liabilities as of June 30, 2020 are as follows (in thousands):



	Operating Leases
Remainder of current year	$	4,052
Year ending December 31, 2021	8,595
Year ending December 31, 2022	12,530
Year ending December 31, 2023	12,409
Year ending December 31, 2024	10,885
Thereafter	105,398
Total lease payments	153,869
Less: Interest	47,219
Less: Tenant improvement allowances	14,078
Present value of lease liabilities	$	92,572

Rental income of $0.1 million and $0.3 million in the second quarter and first six months of 2019, respectively, is included in other income on the accompanying consolidated statements of operations and comprehensive income.