Leases

3 Months Ended

Mar. 31, 2022

Leases [Abstract]

Leases

LeasesThe Company’s lease portfolio is comprised of operating leases for laboratory, office and manufacturing facilities located in South San Francisco, California, and Seattle and Bothell, Washington with contractual periods expiring between December 2028 and March 2031. In addition to minimum rent, the leases require payment of real estate taxes, insurance, common area maintenance charges and other executory costs. These additional charges are considered variable lease costs and are recognized in the period in which the costs are incurred.

The following table summarizes the Company’s future minimum operating lease commitments, including expected lease incentives to be received, as of March 31, 2022 (in thousands):

Year Ending December 31:
2022 (remaining nine months)	$	7,289
2023	11,018
2024	11,347
2025	11,859
2026	12,209
Thereafter	48,094
Total undiscounted lease payments	101,816
Less: imputed interest	(30,282)
Less: tenant improvement allowances	(2,720)
Total operating lease liabilities	$	68,814
Reported as of March 31, 2022:
Short-term portion of lease liabilities (included in accrued liabilities and other current liabilities)	$	1,339
Operating lease liabilities, non-current	67,475
Total	$	68,814

The operating lease costs for all operating leases were $2.5 million and $2.4 million for the three months ended March 31, 2022 and 2021, respectively. The operating lease costs and total commitments for short-term leases were de minimis for the three months ended March 31, 2022 and 2021. Variable lease costs for operating leases were $1.3 million and $1.1 million for the three months ended March 31, 2022 and 2021. The weighted-average remaining lease terms for operating leases were 8.5 and 8.8 years as of March 31, 2022 and December 31, 2021, respectively. The weighted-average discount rates for operating leases were 8.5% and 8.4% as of March 31, 2022 and December 31, 2021, respectively.

In May 2021, the Company entered into a sublease, whereby the Company agreed to sublease approximately 11,000 square feet of its space in South San Francisco, California currently leased by the Company. The sublease is classified as an operating lease and will expire in March 2031. The monthly fixed payment due to the Company is $0.1 million, subject to annual rent increases in accordance with the contract.

In September 2021, the Company entered into a sublease with Sonoma Biotherapeutics, Inc. (“Sonoma”), a related party, whereby the Company agreed to sublease approximately 18,000 square feet of space in South San Francisco, California currently leased by the Company. See Note 13, Related-Party Transactions. As a part of the sublease, in September 2021, the Company received a $4.6 million tenant improvement contribution payment, which will be recognized over the term of the sublease. The sublease is classified as an operating lease and will expire in March 2031. The monthly fixed payment due to the Company is $0.2 million, subject to annual rent increases in accordance with the contract.

Leases

LeasesThe Company’s lease portfolio is comprised of operating leases for laboratory, office and manufacturing facilities located in South San Francisco, California, and Seattle and Bothell, Washington with contractual periods expiring between December 2028 and March 2031. In addition to minimum rent, the leases require payment of real estate taxes, insurance, common area maintenance charges and other executory costs. These additional charges are considered variable lease costs and are recognized in the period in which the costs are incurred.

The following table summarizes the Company’s future minimum operating lease commitments, including expected lease incentives to be received, as of March 31, 2022 (in thousands):

Year Ending December 31:
2022 (remaining nine months)	$	7,289
2023	11,018
2024	11,347
2025	11,859
2026	12,209
Thereafter	48,094
Total undiscounted lease payments	101,816
Less: imputed interest	(30,282)
Less: tenant improvement allowances	(2,720)
Total operating lease liabilities	$	68,814
Reported as of March 31, 2022:
Short-term portion of lease liabilities (included in accrued liabilities and other current liabilities)	$	1,339
Operating lease liabilities, non-current	67,475
Total	$	68,814

The operating lease costs for all operating leases were $2.5 million and $2.4 million for the three months ended March 31, 2022 and 2021, respectively. The operating lease costs and total commitments for short-term leases were de minimis for the three months ended March 31, 2022 and 2021. Variable lease costs for operating leases were $1.3 million and $1.1 million for the three months ended March 31, 2022 and 2021. The weighted-average remaining lease terms for operating leases were 8.5 and 8.8 years as of March 31, 2022 and December 31, 2021, respectively. The weighted-average discount rates for operating leases were 8.5% and 8.4% as of March 31, 2022 and December 31, 2021, respectively.

In May 2021, the Company entered into a sublease, whereby the Company agreed to sublease approximately 11,000 square feet of its space in South San Francisco, California currently leased by the Company. The sublease is classified as an operating lease and will expire in March 2031. The monthly fixed payment due to the Company is $0.1 million, subject to annual rent increases in accordance with the contract.

In September 2021, the Company entered into a sublease with Sonoma Biotherapeutics, Inc. (“Sonoma”), a related party, whereby the Company agreed to sublease approximately 18,000 square feet of space in South San Francisco, California currently leased by the Company. See Note 13, Related-Party Transactions. As a part of the sublease, in September 2021, the Company received a $4.6 million tenant improvement contribution payment, which will be recognized over the term of the sublease. The sublease is classified as an operating lease and will expire in March 2031. The monthly fixed payment due to the Company is $0.2 million, subject to annual rent increases in accordance with the contract.