Property and Equipment, Net

6 Months Ended

Jun. 30, 2018

Property, Plant and Equipment [Abstract]



(amounts in thousands)	June 30, 2018			December 31, 2017
Property and equipment	$	1,924,627		$	1,863,624
Accumulated depreciation	(1,121,064		)	(1,106,913		)
Total property and equipment, net	$	803,563		$	756,711

We monitor all property and equipment for any indicators of potential impairment. We recorded no impairment charges during the three-month period ended June 30, 2018 and $0.6 million during the six-month period ended June 30, 2018. No impairments were recorded during the three and six months ended July 1, 2017.

In November of 2016, we entered into a 17-year, non-cancelable build-to-suit arrangement for a corporate headquarters facility in Charlotte, North Carolina that is accounted for under the build-to-suit guidance contained in ASC 840, Leases. The lease commenced upon completion of construction in February 2018. Since we were involved in the construction of structural improvements prior to the commencement of the lease and took some level of construction risk, we were considered the accounting owner of the assets and land during the construction period. Further, since certain terms of the lease do not meet normal sale-leaseback criteria, we are considered the accounting owner after the construction period as well. During the first quarter of 2018, we recorded $20.0 million of build-to-suit assets included in Property and equipment, net, and set up a corresponding financial obligation of $20.4 million included in long-term debt in the accompanying unaudited consolidated balance sheet. In the second quarter of 2018, a tenant improvement allowance was received, increasing long-term debt by $4.2 million. The build-to-suit asset is being depreciated over its estimated useful life and lease payments are being applied as debt service against the liability.

Depreciation expense was recorded as follows:



	Three Months Ended				Six Months Ended
(amounts in thousands)	June 30, 2018		July 1, 2017		June 30, 2018		July 1, 2017
Cost of sales	$	21,014	$	19,076	$	40,997	$	37,971
Selling, general and administrative	2,492		1,844		4,490		3,934
Total depreciation expense	$	23,506	$	20,920	$	45,487	$	41,905