Quarterly report [Sections 13 or 15(d)]

Leases

v3.25.2
Leases
 6 Months Ended
Jun. 30, 2025
Leases [Abstract]  
Leases
Note 11 – Leases
Lessor
As of June 30, 2025, the Company’s operating leases have non-cancelable lease terms ranging from 0.1 years to 15.5 years. Certain leases with tenants include tenant options to extend or terminate the lease agreements or to purchase the underlying assets. Lease agreements may also contain rent increases that are based on an index or rate (e.g., the consumer price index).
The components of rental revenue from the Company’s operating leases during the periods indicated below were as follows (in thousands):
Three Months Ended June 30, Six Months Ended June 30,
2025 2024 2025 2024
Fixed:
Cash rental revenue $ 22,890  $ 30,306  $ 46,532  $ 61,984 
Straight-line rental revenue 2,519  (240) 6,150  309 
Lease intangible amortization 206  305  456  719 
Fixed property operating cost reimbursements 1,519  1,445  3,028  2,891 
Other fixed rental revenue 792  —  1,495  1,038 
Total fixed 27,926  31,816  57,661  66,941 
Variable:
Variable property operating cost reimbursements 8,580  7,469  16,040  18,665 
Other variable rental revenue 596  638  1,198  1,312 
Total variable 9,176  8,107  17,238  19,977 
Total rental revenue $ 37,102  $ 39,923  $ 74,899  $ 86,918 
The following table presents future minimum base rent payments due to the Company under the terms of its operating lease agreements, excluding expense reimbursements, over the next five years and thereafter as of June 30, 2025 (in thousands).
Future Minimum
Base Rent Payments
July 1, 2025 - December 31, 2025
 $ 41,990 
2026 86,793 
2027 75,528 
2028 66,362 
2029 50,275 
2030 48,275 
Thereafter 234,654 
Total $ 603,877 
Lessee
The Company is the lessee under ground lease arrangements and corporate office leases, which meet the criteria under U.S. GAAP for an operating lease. As of June 30, 2025, the Company’s operating leases had remaining lease terms ranging from 0.4 years to 59.5 years, which includes options to extend. Under the operating leases, the Company pays rent and may also pay variable costs, including property operating expenses and common area maintenance. The weighted average discount rate used to measure the lease liability for the Company’s operating leases was 3.65% as of June 30, 2025. As the Company’s leases do not provide an implicit rate, the Company used an estimated incremental borrowing rate based on the information available at the lease commencement date or the lease guidance adoption date, as applicable, in determining the present value of lease payments.
Operating lease costs were $0.3 million for the three months ended June 30, 2025 and 2024, and $0.6 million for the six months ended June 30, 2025 and 2024. No cash paid for operating lease liabilities was capitalized during the three and six months ended June 30, 2025 and 2024.
The following table reflects the maturity analysis of payments due from the Company over the next five years and thereafter for ground and corporate office lease obligations as of June 30, 2025 (in thousands).
Future Minimum Lease Payments
July 1, 2025 - December 31, 2025
 $ 592 
2026 778 
2027 752 
2028 761 
2029 473 
2030 447 
Thereafter 11,597 
Total 15,400 
Less: imputed interest 5,353 
Total $ 10,047 
Leases
Note 11 – Leases
Lessor
As of June 30, 2025, the Company’s operating leases have non-cancelable lease terms ranging from 0.1 years to 15.5 years. Certain leases with tenants include tenant options to extend or terminate the lease agreements or to purchase the underlying assets. Lease agreements may also contain rent increases that are based on an index or rate (e.g., the consumer price index).
The components of rental revenue from the Company’s operating leases during the periods indicated below were as follows (in thousands):
Three Months Ended June 30, Six Months Ended June 30,
2025 2024 2025 2024
Fixed:
Cash rental revenue $ 22,890  $ 30,306  $ 46,532  $ 61,984 
Straight-line rental revenue 2,519  (240) 6,150  309 
Lease intangible amortization 206  305  456  719 
Fixed property operating cost reimbursements 1,519  1,445  3,028  2,891 
Other fixed rental revenue 792  —  1,495  1,038 
Total fixed 27,926  31,816  57,661  66,941 
Variable:
Variable property operating cost reimbursements 8,580  7,469  16,040  18,665 
Other variable rental revenue 596  638  1,198  1,312 
Total variable 9,176  8,107  17,238  19,977 
Total rental revenue $ 37,102  $ 39,923  $ 74,899  $ 86,918 
The following table presents future minimum base rent payments due to the Company under the terms of its operating lease agreements, excluding expense reimbursements, over the next five years and thereafter as of June 30, 2025 (in thousands).
Future Minimum
Base Rent Payments
July 1, 2025 - December 31, 2025
 $ 41,990 
2026 86,793 
2027 75,528 
2028 66,362 
2029 50,275 
2030 48,275 
Thereafter 234,654 
Total $ 603,877 
Lessee
The Company is the lessee under ground lease arrangements and corporate office leases, which meet the criteria under U.S. GAAP for an operating lease. As of June 30, 2025, the Company’s operating leases had remaining lease terms ranging from 0.4 years to 59.5 years, which includes options to extend. Under the operating leases, the Company pays rent and may also pay variable costs, including property operating expenses and common area maintenance. The weighted average discount rate used to measure the lease liability for the Company’s operating leases was 3.65% as of June 30, 2025. As the Company’s leases do not provide an implicit rate, the Company used an estimated incremental borrowing rate based on the information available at the lease commencement date or the lease guidance adoption date, as applicable, in determining the present value of lease payments.
Operating lease costs were $0.3 million for the three months ended June 30, 2025 and 2024, and $0.6 million for the six months ended June 30, 2025 and 2024. No cash paid for operating lease liabilities was capitalized during the three and six months ended June 30, 2025 and 2024.
The following table reflects the maturity analysis of payments due from the Company over the next five years and thereafter for ground and corporate office lease obligations as of June 30, 2025 (in thousands).
Future Minimum Lease Payments
July 1, 2025 - December 31, 2025
 $ 592 
2026 778 
2027 752 
2028 761 
2029 473 
2030 447 
Thereafter 11,597 
Total 15,400 
Less: imputed interest 5,353 
Total $ 10,047