Quarterly report pursuant to Section 13 or 15(d)

Lease Accounting

v3.20.1
Lease Accounting
3 Months Ended
Mar. 31, 2020
Leases [Abstract]  
Lease Accounting LEASE ACCOUNTING

Leasing as a Lessor

Future Minimum Rental Income

As of March 31, 2020, non-cancelable commercial operating leases provide for future minimum rental income from continuing operations as follows (in thousands). Apartment leases are not included as the terms are generally for one year or less.
2020
 
$
106,177

2021
 
137,244

2022
 
124,684

2023
 
107,647

2024
 
94,677

Thereafter
 
316,221

 
 
$
886,650



Leasing as a Lessee

2000 M Street, an office property in Washington, DC, is subject to an operating ground lease with a remaining term of 51 years. Rental payments under this lease are subject to percentage rent variable payments, which are not included as part of our measurement of straight-line rental expense. We recognized variable rental payments of $0.2 million during the 2020 Quarter and 2019 Quarter.

We recognized a right of use asset (included in Income producing property) and lease liability (included in Accounts payable and other liabilities) of $4.2 million. We used a discount rate of approximately 5.9%, which was derived from our assessment of securitized rates for similar assets and credit quality. We recognized $0.1 million of right-of-use and lease liability amortization during the 2020 Quarter and 2019 Quarter.

The following table sets forth the undiscounted cash flows of our scheduled obligations for future minimum payments on our operating ground lease as of March 31, 2020 and a reconciliation of those cash flows to the operating lease liability as of March 31, 2020 (in thousands):
2020
 
$
195

2021
 
260

2022
 
260

2023
 
260

2024
 
260

Thereafter
 
11,830

 
 
13,065

Imputed interest
 
(9,156
)
Lease liability
 
$
3,909


Lease Accounting LEASE ACCOUNTING

Leasing as a Lessor

Future Minimum Rental Income

As of March 31, 2020, non-cancelable commercial operating leases provide for future minimum rental income from continuing operations as follows (in thousands). Apartment leases are not included as the terms are generally for one year or less.
2020
 
$
106,177

2021
 
137,244

2022
 
124,684

2023
 
107,647

2024
 
94,677

Thereafter
 
316,221

 
 
$
886,650



Leasing as a Lessee

2000 M Street, an office property in Washington, DC, is subject to an operating ground lease with a remaining term of 51 years. Rental payments under this lease are subject to percentage rent variable payments, which are not included as part of our measurement of straight-line rental expense. We recognized variable rental payments of $0.2 million during the 2020 Quarter and 2019 Quarter.

We recognized a right of use asset (included in Income producing property) and lease liability (included in Accounts payable and other liabilities) of $4.2 million. We used a discount rate of approximately 5.9%, which was derived from our assessment of securitized rates for similar assets and credit quality. We recognized $0.1 million of right-of-use and lease liability amortization during the 2020 Quarter and 2019 Quarter.

The following table sets forth the undiscounted cash flows of our scheduled obligations for future minimum payments on our operating ground lease as of March 31, 2020 and a reconciliation of those cash flows to the operating lease liability as of March 31, 2020 (in thousands):
2020
 
$
195

2021
 
260

2022
 
260

2023
 
260

2024
 
260

Thereafter
 
11,830

 
 
13,065

Imputed interest
 
(9,156
)
Lease liability
 
$
3,909