LEASES

12 Months Ended

Dec. 31, 2022

The Company determines if a contractual arrangement is a lease at inception. As a lessee, the Company has non-cancelable lease agreements for real estate and its corporate office space that are classified as operating leases. The Company's operating leases are included in operating lease right-of-use ("ROU") assets and operating lease liabilities in its consolidated balance sheets. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As the Company's operating leases do not provide an implicit rate, the Company used its incremental borrowing rate based on the information available at commencement date in determining the discount rate for the present value of the lease payments. To the extent that the lease agreements provide for fixed increases throughout the term of the lease, the Company recognizes lease expense on a straight-line basis over the expected lease terms.

Real Estate Leasehold Interests

The Company has eight properties that are subject to non-cancelable leasehold interest agreements with remaining lease terms ranging from 12 to 70 years, inclusive of extension options that the Company anticipates exercising. Rent expense under these leasehold interest agreements is included in property operating expenses in the accompanying consolidated statements of operations and amounted to $1.6 million, $1.7 million and $1.8 million for the years ended December 31, 2022, 2021 and 2020, respectively.

Office Leases

The Company has entered into non-cancelable lease agreements for its corporate office space with remaining lease terms ranging from four to six years. Rent expense related to these office leases is included in general and administrative expenses in the accompanying consolidated statements of operations and amounted to $0.4 million, $0.4 million and $0.4 million for the years ended December 31, 2022, 2021 and 2020, respectively.

Solar Panel Leases

During year ended December 31, 2022, the Company entered into non-cancelable lease agreements for solar panels with remaining lease terms of 20 years. Rent expense related to these solar panel leases is included in general and administrative expenses in the accompanying consolidated statements of operations and amounted to $0.1 million for the year ended December 31, 2022.

The weighted-average remaining lease term and the weighted-average discount rate for the Company's operating leases as of December 31, 2022 are as follows:

December 31, 2022

Weighted-average remaining lease term

Real estate leasehold interests

26 years

Office leases

5 years

Solar Panels

20 years

Weighted-average remaining discount rate

Real estate leasehold interests

4.9

Office leases

3.8

Solar Panels

4.3

As of December 31, 2022, the future minimum lease payments under the Company's operating leases, for which the Company is a lessee, are as follows (in thousands):


Year Ending December 31,	Real Estate Leasehold Interests		Office Leases		Solar Panels		Total
2023	$	1,464	$	430	$	150	$	2,044
2024	1,470		450		150		2,070
2025	1,521		456		154		2,131
2026	1,549		429		165		2,143
2027	1,567		97		165		1,829
2028 through 2092	32,091		97		3,177		35,365
Total lease payments	$	39,662	$	1,959	$	3,961	$	45,582
Less imputed interest	(18,259)		(189)		(1,393)		(19,841)
Total	$	21,403	$	1,770	$	2,568	$	25,741

As of December 31, 2021, the future minimum lease payments under the Company's operating leases, for which the Company is a lessee, are as follows (in thousands):


Year Ending December 31,	Real Estate Leasehold Interests		Office Leases		Total
2022	$	1,459	$	465	$	1,924
2023	1,464		430		1,894
2024	1,470		450		1,920
2025	1,521		456		1,977
2026	1,549		429		1,978
2027 through 2092	33,657		195		33,852
Total lease payments	$	41,120	$	2,425	$	43,545
Less imputed interest	(19,326)		(238)		(19,564)
Total	$	21,794	$	2,187	$	23,981