Leases

9 Months Ended

Sep. 30, 2022

Leases [Abstract]

Leases

(11)Leases

The Company enters into operating leases primarily for standalone homes, luxury condos and hotel rooms. The Company determines if an arrangement is a lease, or contains a lease, including embedded leases, at inception and records the leases in the Company’s financial statements upon later of ASC 842 adoption date of January 1, 2022, or lease commencement, which is the date when the underlying asset is made available for use by the lessor. Active leases have initial terms ranging from 3 to 15 years, and generally contain extension options at the approval of both parties. We have generally not included these renewal periods in the lease term as it is not reasonably certain that we will exercise the renewal option. Lease expense for operating lease payments is recognized on a straight-line basis over the lease term. Variable lease expense includes expenses incurred as a result of the lease agreement which are not considered known expenses at lease inception and are recognized as incurred. Variable expenses can include, but are not limited to, revenue shares, owner buyback adjustments and usage-based agreements. Operating lease expense and variable lease expense are included in cost of revenue on the condensed consolidated statement of operations.

The following table details the composition of operating lease expense for the three and nine months ended September 30, 2022

	Three Months Ended		Nine Months Ended
	September 30, 2022		September 30, 2022
	(in thousands)
Operating lease expense	$	22,240	$	60,035
Variable lease expense		218		1,411

As of September 30, 2022, the maturities of the Company’s operating lease liabilities (excluding short-term leases) were as follows:

	Operating leases
	(in thousands)
Remainder of 2022	$	21,483
Year ending December 31, 2023		74,208
Year ending December 31, 2024		51,760
Year ending December 31, 2025		42,693
Year ending December 31, 2026		35,369
Thereafter		71,246
Total minimum lease payments		296,759
Less: interest expense		(35,528)
Present value of lease obligations		261,231
Less: current lease obligations		(70,566)
Long-term lease obligations	$	190,665

As previously reported in the Company’s audited financial statements for the year ended December 31, 2021 and under legacy lease accounting (ASC 840), future minimum lease payments under non-cancellable leases as of December 31, 2021 were as follows:

Years ending December 31,	Amount
	(in thousands)
2022	$	69,329
2023		58,744
2024		37,850
2025		28,203
2026		20,345
Thereafter		25,716
Total	$	240,187

The following table presents additional information about our lease obligations as of September 30, 2022:

	As of September 30, 2022
Weighted-average remaining lease term (in years):
Operating leases	5.25
Weighted-average discount rate:
Operating leases	5.09	%

The following table presents supplemental cash flow information for the nine months ended September 30, 2022:

	Nine Months Ended
	September 30, 2022
	(in thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	64,573