NOTE 12: LEASES

We lease and sublease various facilities and certain equipment under operating and capital leases. Future minimum rentals due under non-cancelable leases and annual future minimum rentals expected under subleases are as follows:



Fiscal Year Ended September 30,	Operating Lease Payments		Sublease Revenue

	(in thousands)
2019	$	55,811	$	3,249
2020	50,174		3,335
2021	42,767		3,402
2022	30,911		2,908
2023	19,873		1,561
Thereafter	29,685		1,043
	$	229,221	$	15,498

After an initial lease term of generally three to 10 years, our real property lease agreements typically allow renewals in three to five-year increments. Our lease agreements generally include rent escalations throughout the initial lease term. Rent escalations are included in the above amounts, with certain future rental payments contingent on increases in a consumer price index. For financial reporting purposes, the aggregate rentals over the lease term, including lease renewal options that are reasonably assured, are expensed on a straight-line basis.

The following table presents the amount of net rent recognized as expense:



	Fiscal Year Ended September 30,
	2018			2017			2016

	(in thousands)
Gross rent expense from continuing operations	$	61,821		$	56,794		$	56,707
Sublease rent revenue from continuing operations	(109		)	(56		)	(156		)
Net rent expense from continuing operations	$	61,712		$	56,738		$	56,551

In December 2014, we entered into a non-cancelable 13-year operating lease for our corporate offices, with rent payments beginning February 2016 and ending March 2029. Annual rent, net of square footage subsequently terminated as a result of negotiations with the landlord, escalated from $2.5 million at lease inception to $3.9 million in the terminal year of the lease. The lease includes two five-year extension options at the end of the initial lease term. The estimated minimum future rental payments under the lease are approximately $38.1 million. During fiscal 2017 and 2016, we initiated subleases for a portion of our corporate operating office lease for estimated minimum future sublease payments of approximately $12.2 million. In addition to the above subleases, during fiscal 2018 we entered into an amendment to the operating lease surrendering another 15% of the initial leased premises. As a result, sublease payments are expected to fully offset our original operating lease obligations through August 2023, with renewal options available until the end of the master operating lease in March 2029.

During the second quarter of fiscal 2015, we entered into non-cancelable subleases for our Miami and Mexico City regional offices for estimated minimum future sublease payments of approximately $4.6 million. Sublease payments are expected to offset substantially all of our original operating lease obligations over the nine-year period beginning March 2015 and ending September 2024 in the case of the Miami lease. The Mexico City sublease expired in fiscal 2018 and is being subleased on a monthly basis while the terms of an additional sublease are renegotiated.