Leases (Tables)

9 Months Ended

Sep. 30, 2021

Leases [Abstract]

Lease income

The components of rental revenue from the Company’s operating and direct financing leases were as follows (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Fixed:
Cash rent	$	264,466	$	255,996	$	799,943	$	778,697
Straight-line rent	3,560		12,595		12,392		18,053
Lease intangible amortization	(1,164)		(393)		(4,541)		(1,929)
Property operating cost reimbursements	1,373		1,581		4,045		4,372
Sub-lease (1)	4,898		5,175		14,623		15,718
Total fixed	273,133		274,954		826,462		814,911
Variable (2)	16,422		18,585		43,711		55,438
Income from direct financing leases	116		153		374		505
Total rental revenue	$	289,671	$	293,692	$	870,547	$	870,854

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(1)The Company’s tenants are generally sub-tenants under certain ground leases and are responsible for paying the rent under these leases.

(2)Includes costs reimbursed related to property operating expenses, common area maintenance and percentage rent, including these costs reimbursed by ground lease sub-tenants.

Lessor, operating lease payments receivable

The following table presents future minimum operating lease payments due to the Company over the next five years and thereafter as of September 30, 2021 (in thousands). These amounts exclude contingent rent payments, as applicable, that may be collected from certain tenants based on provisions related to sales thresholds and increases in annual rent based on exceeding certain economic indexes.

	Future Minimum Operating Lease Payments		Future Minimum Direct Financing Lease Payments (1)
October 1, 2021 - December 31, 2021	$	251,110	$	501
2022	1,009,650		1,925
2023	954,282		1,565
2024	890,154		510
2025	790,230		169
2026	730,788		171
Thereafter	4,532,336		484
Total	$	9,158,550	$	5,325

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(1)Related to 18 properties which are subject to direct financing leases and, therefore, revenue is recognized as rental income on the discounted cash flows of the lease payments. Amounts reflect undiscounted cash flows to be received by the Company under the lease agreements on these respective properties.

Lessor, direct financing leases maturities

The following table presents future minimum operating lease payments due to the Company over the next five years and thereafter as of September 30, 2021 (in thousands). These amounts exclude contingent rent payments, as applicable, that may be collected from certain tenants based on provisions related to sales thresholds and increases in annual rent based on exceeding certain economic indexes.

	Future Minimum Operating Lease Payments		Future Minimum Direct Financing Lease Payments (1)
October 1, 2021 - December 31, 2021	$	251,110	$	501
2022	1,009,650		1,925
2023	954,282		1,565
2024	890,154		510
2025	790,230		169
2026	730,788		171
Thereafter	4,532,336		484
Total	$	9,158,550	$	5,325

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(1)Related to 18 properties which are subject to direct financing leases and, therefore, revenue is recognized as rental income on the discounted cash flows of the lease payments. Amounts reflect undiscounted cash flows to be received by the Company under the lease agreements on these respective properties.

Lease cost

The following table presents the lease expense components for the three and nine months ended September 30, 2021 and 2020 (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Operating lease cost (1)	$	5,704	$	5,933	$	16,932	$	19,643
Sublease income (2)	$	(4,898)	$	(5,175)	$	(14,623)	$	(15,718)

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(1)No cash paid for operating lease liabilities was capitalized.

(2)The Company’s tenants are generally sub-tenants under certain ground leases and are responsible for paying the rent under these leases.

Lessee, operating lease maturities

The following table reflects the maturity analysis of payments due from the Company over the next five years and thereafter for ground lease obligations, which are substantially reimbursable by our tenants, and office lease obligations as of September 30, 2021 (in thousands).

	Future Minimum Lease Payments
October 1, 2021 - December 31, 2021	$	5,649
2022	21,069
2023	20,571
2024	19,942
2025	19,644
2026	18,247
Thereafter	187,379
Total	292,501
Less: imputed interest	95,830
Total	$	196,671