Leases

6 Months Ended

Jun. 30, 2019

Lessor

Rental income derived from customers renting our Sites is accounted for in accordance with ASC 842, Leases, and is recognized over the term of the respective operating lease or the length of a customer's stay. Our MH community Sites and annual RV community Sites are leased on an annual basis. Seasonal Sites are leased to customers generally for one to six months. Transient Sites are leased to customers on a short-term basis. In addition, customers may lease homes that are located in our Properties.

The leases entered into between the customer and us for the rental of a Site are renewable upon the consent of both parties or, in some instances, as provided by statute. Long-term leases that are non-cancelable by the tenants are in effect at certain Properties. Rental rate increases at these Properties are primarily a function of increases in the Consumer Price Index, taking into consideration certain conditions. Additionally, periodic market rate adjustments are made as deemed appropriate. In addition, certain state statutes allow entry into long-term agreements that effectively modify lease terms related to rent amounts and increases over the term of the agreements. The following table presents future minimum rents expected to be received under long-term non-cancelable tenant leases, as well as those leases that are subject to long-term agreements governing rent payments and increases:



(amounts in thousands)	As of June 30, 2019
2019	$	60,067
2020	120,012
2021	65,321
2022	34,906
2023	19,714
Thereafter	84,254
Total	$	384,274

Lessee

We lease land under non-cancelable operating leases at 13 Properties expiring at various dates through 2054. The majority of the leases have terms requiring fixed payments plus additional rents based on a percentage of gross revenues at those Properties. We also have other operating leases, primarily office space expiring at various dates through 2026. For the quarters ended June 30, 2019 and 2018, total operating lease payments were $2.3 million and $2.1 million, respectively. For the six months ended June 30, 2019 and 2018, total operating lease payments were $4.6 million and $4.1 million, respectively.

The following table summarizes our future minimum rental payments, excluding variable costs, which are discounted by our incremental borrowing rate to calculate the lease liabilities for our operating leases:



(amounts in thousands)	As of June 30, 2019			As of December 31, 2018
2019	$	2,770		$	4,921
2020	4,801			4,801
2021	4,179			4,179
2022	2,103			2,103
2023	953			953
Thereafter	5,054			5,054
Total undiscounted rental payments	19,860			22,011
Less imputed interest	(2,895		)	(3,289		)
Total lease liabilities	$	16,965		$	18,722

ROU assets and lease liabilities from our operating leases included within Other assets, net and Accounts payable and other liabilities on the Consolidated Balance Sheets were $15.7 million and $17.0 million, respectively, as of June 30, 2019. The weighted average remaining lease term for our operating leases was 7 years and the weighted average incremental borrowing rate was 4.4% at June 30, 2019.

Leases

Lessor



(amounts in thousands)	As of June 30, 2019
2019	$	60,067
2020	120,012
2021	65,321
2022	34,906
2023	19,714
Thereafter	84,254
Total	$	384,274

Lessee



(amounts in thousands)	As of June 30, 2019			As of December 31, 2018
2019	$	2,770		$	4,921
2020	4,801			4,801
2021	4,179			4,179
2022	2,103			2,103
2023	953			953
Thereafter	5,054			5,054
Total undiscounted rental payments	19,860			22,011
Less imputed interest	(2,895		)	(3,289		)
Total lease liabilities	$	16,965		$	18,722