Annual report [Section 13 and 15(d), not S-K Item 405]

Leases

v3.25.4
Leases
 12 Months Ended
Dec. 31, 2025
Leases [Abstract]  
Leases
Note 11 – Leases
Lessor
As of December 31, 2025, the Company’s operating leases have non-cancelable lease terms ranging from 0.2 years to 15.6 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):
Year Ended December 31,
2025 2024 2023
Fixed:
Cash rental revenue $ 88,373  $ 117,953  $ 141,471 
Straight-line rental revenue 13,125  (210) 5,649 
Lease intangible amortization 769  637  894 
Fixed property operating cost reimbursements 6,100  5,881  5,956 
Other fixed rental revenue 4,810  1,128  865 
Total fixed 113,177  125,389  154,835 
Variable:
Variable property operating cost reimbursements 31,314  35,897  36,010 
Other variable rental revenue 2,336  2,769  3,396 
Total variable 33,650  38,666  39,406 
Total rental revenue $ 146,827  $ 164,055  $ 194,241 
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 December 31, 2025 (in thousands).
Future Minimum
Base Rent Payments
2026
 $ 85,124 
2027 76,919 
2028 67,923 
2029 51,859 
2030 49,840 
Thereafter 259,054 
Total $ 590,719 
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 December 31, 2025, the Company’s operating leases had remaining lease terms ranging from 0.1 years to 59.0 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 3.57% as of December 31, 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 $1.2 million, $1.2 million and $1.3 million for the years ended December 31, 2025, 2024 and 2023, respectively. No cash paid for operating lease liabilities was capitalized during the years ended December 31, 2025, 2024 and 2023.
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 December 31, 2025 (in thousands).
Future Minimum Lease Payments
2026
 $ 778 
2027 752 
2028 761 
2029 473 
2030 447 
Thereafter 11,597 
Total 14,808 
Less: imputed interest 5,170 
Total $ 9,638 
Leases
Note 11 – Leases
Lessor
As of December 31, 2025, the Company’s operating leases have non-cancelable lease terms ranging from 0.2 years to 15.6 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):
Year Ended December 31,
2025 2024 2023
Fixed:
Cash rental revenue $ 88,373  $ 117,953  $ 141,471 
Straight-line rental revenue 13,125  (210) 5,649 
Lease intangible amortization 769  637  894 
Fixed property operating cost reimbursements 6,100  5,881  5,956 
Other fixed rental revenue 4,810  1,128  865 
Total fixed 113,177  125,389  154,835 
Variable:
Variable property operating cost reimbursements 31,314  35,897  36,010 
Other variable rental revenue 2,336  2,769  3,396 
Total variable 33,650  38,666  39,406 
Total rental revenue $ 146,827  $ 164,055  $ 194,241 
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 December 31, 2025 (in thousands).
Future Minimum
Base Rent Payments
2026
 $ 85,124 
2027 76,919 
2028 67,923 
2029 51,859 
2030 49,840 
Thereafter 259,054 
Total $ 590,719 
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 December 31, 2025, the Company’s operating leases had remaining lease terms ranging from 0.1 years to 59.0 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 3.57% as of December 31, 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 $1.2 million, $1.2 million and $1.3 million for the years ended December 31, 2025, 2024 and 2023, respectively. No cash paid for operating lease liabilities was capitalized during the years ended December 31, 2025, 2024 and 2023.
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 December 31, 2025 (in thousands).
Future Minimum Lease Payments
2026
 $ 778 
2027 752 
2028 761 
2029 473 
2030 447 
Thereafter 11,597 
Total 14,808 
Less: imputed interest 5,170 
Total $ 9,638