Leases

9 Months Ended

Sep. 30, 2020

The Company has net investments in direct financing and sales-type leases to commercial, industrial, and tax-exempt entities. These leases are included within business loans on the Company's consolidated balance sheets. The Company primarily leases various types of equipment, trucks and trailers, and office furniture and fixtures. Lease agreements may include options to renew or for the lessee to purchase the leased equipment at the end of the lease term. The Company has elected to adopt the lease component expedient in which the lease and nonlease components are combined into the total lease receivable. The Company also leases office space to third parties, and these leases are classified as operating leases. The leases may include options to renew or expand the leased space, and currently the leases have remaining terms of 6 months to 7 years.

The following table provides the components of lease income.


	For the Three Months Ended September 30				For the Nine Months Ended September 30
(in thousands)	2020		2019		2020		2019
Direct financing and sales-type leases	$	6,437	$	6,092	$	19,099	$	17,988
Operating leases(a)	2,270		1,984		6,491		5,816
Total lease income	$	8,707	$	8,076	$	25,590	$	23,804

(a) Includes rent from Tower Properties Company, a related party, of $19 thousand for the three month periods ended September 30, 2020 and 2019, and $57 thousand and $56 thousand, respectively, for the nine months ended September 30, 2020 and 2019.