The Company leases certain store real estate, warehouses, distribution centers, office space and equipment. While the Company’s current strategy emphasizes ownership of store real estate, the Company operates in leased facilities in approximately half of its store locations. Lease terms generally range from 10 to 20 years with options to renew for varying terms at the Company’s sole discretion. Certain leases also include options to purchase the leased property. Leases with an initial term of 12 months or less are not recorded on the balance sheet. Certain leases include escalation clauses or payment of executory costs such as property taxes, utilities or insurance and maintenance. Rent expense for leases with escalation clauses or other lease concessions are accounted for on a straight-line basis over the lease term. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. Certain properties or portions thereof are subleased to others for periods generally ranging from one to 20 years.

The following table provides supplemental balance sheet classification information related to leases:

(1)

Finance lease assets are recorded net of accumulated amortization of $298 and $345 as of November 9, 2019 and February 2, 2019.

The following table provides the components of lease cost:


		Third Quarter Ended		Three Quarters Ended
Lease Cost	Classification	November 9, 2019		November 9, 2019
Operating lease cost⁽¹⁾	Rent Expense	$	229	$	768
Sublease and other rental income	Rent Expense		(28)		(93)
Finance lease cost
Amortization of leased assets	Depreciation and Amortization		13		41
Interest on lease liabilities	Interest Expense		12		37

Net lease cost		$	226	$	753

(1)

Includes short-term leases and variable lease costs, which are immaterial.

Maturities of operating and finance lease liabilities are listed below. Amounts in the table include options to extend lease terms that are reasonably certain of being exercised.


	Operating		Finance
	Leases		Leases		Total
Remainder of 2019	$	195	$	17	$	212
2020		966		95		1,061
2021		891		96		987
2022		754		93		847
2023		685		93		778
Thereafter		6,910		1,003		7,913

Total lease payments		10,401		1,397	$	11,798

Less amount representing interest		3,279		431

Present value of lease liabilities⁽¹⁾	$	7,122	$	966

(1)

Includes the current portion of $673 for operating leases and $50 for finance leases.

Total future minimum rentals under non-cancellable subleases at November 9, 2019 were $308.

The following table provides the weighted-average lease term and discount rate for operating and finance leases:



	November 9, 2019
Weighted-average remaining lease term (years)
Operating leases	16.1
Finance leases	16.0
Weighted-average discount rate
Operating leases	4.3	%
Finance leases	4.2	%

The following table provides supplemental cash flow information related to leases:


	Three Quarters Ended
	November 9, 2019
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	711
Operating cash flows from finance leases		37
Financing cash flows from finance leases		33
Leased assets obtained in exchange for new operating lease liabilities		658
Leased assets obtained in exchange for new finance lease liabilities		185
Net gain recognized from sale and leaseback transactions⁽¹⁾		51
Impairment of operating lease assets		29
Impairment of finance lease assets		40

(1)

During the first three quarters of 2019, the Company entered into sale leaseback transactions related to eight properties, which resulted in total proceeds of $102.

The Company adopted new lease accounting guidance in the first quarter of 2019 as discussed in Note 1 and Note 5, and as required, the following disclosure is provided for periods prior to adoption. Minimum annual rentals and payments under capital leases and lease-financed transactions for the five years subsequent to February 2, 2019 and in the aggregate are listed below. Amounts in the table below only include payments through the noncancelable lease term.


					Lease-
	Capital		Operating		Financed
	Leases		Leases		Transactions
2019	$	103	$	948	$	5
2020		89		880		6
2021		86		773		5
2022		82		649		5
2023		81		556		5
Thereafter		766		3,197		17

Total		1,207	$	7,003	$	43

Less estimated executory costs included in capital leases		—

Net minimum lease payments under capital leases		1,207
Less amount representing interest		372

Present value of net minimum lease payments under capital leases	$	835