Leases

12 Months Ended

Dec. 31, 2019

6. Leases

After Adoption of ASU 2016-02

The Company has lease arrangements for warehouse, fulfillment center, office, and data center spaces. These leases expire at various dates through 2035. Operating lease expense was $122.0 million, $66.7 million and $48.4 million in the twelve months ended December 31, 2019, 2018 and 2017, respectively.

The following table presents other information related to leases:



	Year Ended December 31, 2019
	(in thousands)
Supplemental cash flows information:
Cash payments included in operating cash flows from lease arrangements	$	109,163
Right-of-use assets obtained in exchange for lease obligations	$	301,053

	December 31, 2019
Additional lease information:
Weighted average remaining lease term	10 years
Weighted average discount rate	6.7		%

Future minimum lease payments under non-cancellable leases as of December 31, 2019 were as follows:



	Amount
	(in thousands)
2020	$	143,398
2021	150,025
2022	141,866
2023	137,276
2024	134,724
Thereafter	526,671
Total future minimum lease payments	1,233,960
Less: Imputed interest	(320,254		)
Total	$	913,706

The following table presents total operating leases:



	December 31, 2019
	(in thousands)
Balance sheet line item:
Other current liabilities	91,104
Operating lease liabilities	822,602
Total operating leases	$	913,706

As of December 31, 2019, the Company has entered into $342.3 million of additional operating leases, primarily related to build-to-suit warehouse leases that have not yet commenced. As the Company does not control the underlying assets during the construction period, the Company is not considered the owner of the construction projects for accounting purposes. These operating leases will commence between 2020 and 2021 with lease terms of 5 to 15 years.

Before Adoption of ASU 2016-02

The Company established assets and liabilities for the estimated construction costs incurred under lease arrangements where the Company is considered the owner for accounting purposes only to the extent the Company is involved in the construction of structural improvements or takes construction risk prior to commencement of a lease. These are referred to as "build-to-suit leases". Upon occupancy of facilities under build-to-suit leases, the Company assesses whether these arrangements qualify for sales recognition under the sale-leaseback accounting guidance. If the Company continues to be the deemed owner, the facilities are accounted for as financing leases.

In the year ended December 31, 2018, the construction efforts related to three warehouse lease arrangements were completed. In the first warehouse lease arrangement, the Company concluded it had a letter of credit of $2.5 million and as a result the Company did not meet the sale-leaseback criteria for derecognition of the building assets and liabilities. In both the second and third warehouse lease arrangements, the Company provided non-recourse financing to the lessor and as a result the Company did not meet the sale-leaseback criteria for derecognition of the building assets and liabilities.

Accordingly, these leases were accounted for as financing leases and $101.0 million was recorded in lease financing obligations, net of current portion and property and equipment, net, respectively, in the Company’s Consolidated Balance Sheets as of December 31, 2018.