Leases

12 Months Ended

Dec. 31, 2020

Leases

Leases

NOTE 6 – LEASES

Operating lease commitments:

The following table summarizes Total lease cost for the years ended December 31, 2020 and 2019, which was primarily included in “Selling, general and administrative expenses” on the accompanying Consolidated Statements of Income (in thousands):

	For the Year Ended
	December 31,
	2020		2019
Operating lease cost	$	336,156	$	320,480
Short-term operating lease cost		6,131		5,899
Variable operating lease cost		82,868		76,027
Sublease income		(4,790)		(4,112)
Total lease cost	$	420,365	$	398,294

The following table summarizes the Net rent expense amounts, prior to the adoption of Accounting Standard Codification 842 – Leases, for the year ended December 31, 2018, which were included in “Selling, general and administrative expenses” on the accompanying Consolidated Statements of Income (in thousands):

	For the Year Ended
	December 31, 2018
Minimum operating lease expense	$	305,613
Contingent rents		806
Other lease related occupancy costs		14,449
Total rent expense		320,868
Less: sublease income		3,585
Net rent expense	$	317,283

The following table summarizes other lease related information for the years ended December 31, 2020 and 2019 (in thousands):

		For the Year Ended
		December 31,
		2020		2019
Cash paid for amounts included in the measurement of operating lease liabilities:
	Operating cash flows from operating leases	$	334,994	$	318,048
Right-of-use assets obtained in exchange for new operating lease liabilities			322,712		233,584

The following table identifies the future minimum lease payments under all of the Company’s operating leases for each of the next five years, and in the aggregate thereafter, and reconciles to the present value of the “Operating lease liabilities, less current portion” included in the accompanying Consolidated Balance Sheet as of December 31, 2020 (in thousands):

	December 31, 2020
	Related Parties		Non-Related Parties		Total
2021	$	4,589	$	317,888	$	322,477
2022		3,848		306,134		309,982
2023		3,477		275,966		279,443
2024		1,730		246,547		248,277
2025		957		208,064		209,021
Thereafter		2,064		1,044,244		1,046,308
Total operating lease payments		16,665		2,398,843		2,415,508
Less: present value discount		1,478		372,561		374,039
Total operating lease liabilities		15,187		2,026,282		2,041,469
Less: current portion of operating lease liabilities		4,589		318,189		322,778
Operating lease liabilities, less current portion	$	10,598	$	1,708,093	$	1,718,691

See Note 15 for further information concerning the Company’s related party operating leases.

The future minimum lease payments under the Company’s operating leases, in the table above, do not include potential amounts for percentage rent and other variable operating lease related costs and have not been reduced by expected future minimum sublease income under non-cancelable subleases, which was approximately $17.2 million as of December 31, 2020.  The weighted-average remaining lease term and weighted-average discount rate for the Company’s operating leases was 10.0 years and 4.0%, respectively, as of December 31, 2020.  

The present value discount component of the future minimum lease payments under the Company’s operating leases, in the table above, was primarily calculated using the Company’s incremental borrowing rate based on information available at the lease commencement or modification date.  Inputs for the calculation of the Company’s incremental borrowing rate include valuations and yields of U.S. domestic investment grade corporate bonds and the applicable credit spread over comparable U.S. Treasury rates, adjusted to a collateralized basis by estimating the credit spread improvement that would result from an upgrade of one ratings classification. For leases that commenced prior to January 1, 2019, the incremental borrowing rate used was as of January 1, 2019.  When the implicit rate of a lease is available, the implicit rate is used in the calculation and not the Company’s incremental borrowing rate.