Leases

9 Months Ended

Sep. 30, 2019

Leases

Leases

5. Leases

As the lessee, we currently lease real estate space under noncancelable operating lease agreements for our turn-key data centers at NY1, LA1, LA4, DC1, DC2, DE1, and DE2, and our corporate headquarters located in Denver, Colorado. Our leases have remaining lease terms ranging from less than 1 year to 10 years, some of the leases include options to extend the leases for up to an additional 20 years. We do not include any of our renewal options in our lease terms for calculating our lease liability as the renewal options allow us to maintain operational flexibility and we are not reasonably certain we will exercise these renewal options at this time. The weighted-average remaining non-cancelable lease term for our operating leases was nine years and ten years at September 30, 2019, and December 31, 2018, respectively. The weighted-average discount rate was 4.9% at each date.

During the three months ended September 30, 2019, we extended the term of approximately 5,300 NRSF at our existing DE1 space from October 2019 to October 2024. As a result of this extension, we remeasured the lease liability and adjusted the ROU asset by approximately $1.0 million.

The components of lease expense were as follows (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Lease expense:
Operating lease expense	$	6,868	$	6,144	$	19,662	$	16,789
Variable lease expense		1,463		1,185		4,090		3,487
Rent expense	$	8,331	$	7,329	$	23,752	$	20,276