Leases

3 Months Ended

Mar. 31, 2020

Operating Right of Use Asset

The following table summarizes the Company's operating right of use asset recognized in the consolidated balance sheets as of March 31, 2020 (dollars in thousands):



March 31, 2020
Acquisition Date	Property Type	Primary Location(s)	Operating Right of Use Asset, Gross		Accumulated Amortization			Operating Right of Use Asset, net of Amortization
August 2019	Hotel	Chicago, IL	$	6,109	$	(207	)	$	5,902
			$	6,109	$	(207	)	$	5,902

The following table summarizes the Company's operating right of use asset recognized in the consolidated balance sheets as of December 31, 2019 (dollars in thousands):



December 31, 2019
Acquisition Date	Property Type	Primary Location(s)	Operating Right of Use Asset, Gross		Accumulated Amortization			Operating Right of Use Asset, net of Amortization
August 2019	Hotel	Chicago, IL	$	6,109	$	(130	)	$	5,979
			$	6,109	$	(130	)	$	5,979

Operating Lease Liabilities

On August 19, 2019, in conjunction with the deed-in-lieu of foreclosure transaction, the Company assumed a non-cancelable ground lease for the land on which the property is located and classified the lease as an operating lease. The ground lease requires monthly rental payments with annual increases of 3%. The initial term of the lease expires in 2067 and can be renewed for a sixty-year period. Rent expense for this operating lease for the three months ended March 31, 2020 and March 31, 2019 totaled $0.2 million and $0.0 million, respectively.

The following table summarizes the Company's schedule of minimum future lease payments as of March 31, 2020 (dollars in thousands):



Minimum Future Lease Payments	March 31, 2020
2020 (April - December)	$	300
2021	410
2022	422
2023	435
2024	448
2025 and beyond	39,438
Total undiscounted lease payments	$	41,453
Less: Amount representing interest	(35,277		)
Present value of lease liability	$	6,176

The following table summarizes the Company's schedule of minimum future lease payments as of December 31, 2019 (dollars in thousands):



Minimum Future Lease Payments	December 31, 2019
2020	$	398
2021	410
2022	422
2023	435
2024	448
2025 and beyond	39,438
Total undiscounted lease payments	$	41,551
Less: Amount representing interest	(35,415		)
Present value of lease liability	$	6,136

The discount rate used to calculate the lease liability as of March 31, 2020 and December 31, 2019 is 9%. The remaining lease term is 47.70 years as of March 31, 2020 and 47.95 as of December 31, 2019.

Intangible Lease Asset

The following table summarizes the Company's intangible lease asset recognized in the consolidated balance sheets as of March 31, 2020 (dollars in thousands):



March 31, 2020
Acquisition Date	Property Type	Primary Location(s)	Intangible Lease Asset, Gross		Accumulated Amortization			Intangible Lease Asset, Net of Amortization
October 2019	Office	Jeffersonville, IN	$	14,509	$	(344	)	$	14,165
			$	14,509	$	(344	)	$	14,165

The following table summarizes the Company's intangible lease asset recognized in the consolidated balance sheets as of December 31, 2019 (dollars in thousands):



December 31, 2019
Acquisition Date	Property Type	Primary Location(s)	Intangible Lease Asset, Gross		Accumulated Amortization			Intangible Lease Asset, Net of Amortization
October 2019	Office	Jeffersonville, IN	$	14,509	$	(131	)	$	14,377
			$	14,509	$	(131	)	$	14,377

Rental Income

On October 15, 2019, the Company purchased an office building that was subject to an existing triple net lease. The minimum rental amount due under the lease is subject to annual increases of 1.5%. The initial term of the lease expires in 2037 and contains renewal options for four consecutive five-year terms. The remaining lease term is 17.1 years. Rental income for this operating lease for the three months ended March 31, 2020 and March 31, 2019 totaled $0.7 million and $0.0 million, respectively.

The following table summarizes the Company's schedule of future minimum rents to be received under the lease (dollars in thousands):



Minimum Rents	March 31, 2020
2020 (April - December)	$	1,903
2021	2,568
2022	2,607
2023	2,646
2024	2,686
2025 and beyond	36,894
Total minimum rent	$	49,304

Amortization Expense

Intangible lease assets are amortized using the straight-line method over the contractual life of the lease, of a period up to 20.0 years. The weighted average life of intangible assets as of March 31, 2020 is approximately 17.1 years. Amortization expense for the three months ended March 31, 2020 and March 31, 2019 totaled $0.2 million and $0.0 million, respectively.

The following table summarizes the Company's expected amortization for intangible assets over the next five years, assuming no further acquisitions or dispositions (dollars in thousands):



Amortization Expense	March 31, 2020
2020 (April - December)	$	(619	)
2021	(825		)
2022	(825		)
2023	(825		)
2024	(825		)

Leases