Quarterly report [Sections 13 or 15(d)]

Leases

v3.26.1
Leases
 3 Months Ended
Mar. 31, 2026
Leases [Abstract]  
Leases
Note 11 – Leases
Lessor
As of March 31, 2026, the Company’s operating leases have non-cancelable lease terms ranging from 0.1 years to 15.4 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 March 31,
2026 2025
Fixed:
Cash rental revenue $ 26,511  $ 23,642 
Straight-line rental revenue (1,830) 3,631 
Lease intangible amortization 150  250 
Fixed property operating cost reimbursements 1,659  1,509 
Other fixed rental revenue 1,900  703 
Total fixed 28,390  29,735 
Variable:
Variable property operating cost reimbursements 7,208  7,460 
Other variable rental revenue 536  602 
Total variable 7,744  8,062 
Total rental revenue $ 36,134  $ 37,797 
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 March 31, 2026 (in thousands).
Future Minimum
Base Rent Payments
April 1, 2026 - December 31, 2026
 $ 66,026 
2027 82,565 
2028 73,809 
2029 58,591 
2030 56,722 
2031 52,473 
Thereafter 281,589 
Total $ 671,775 
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 March 31, 2026, the Company’s operating leases had remaining lease terms ranging from 2.8 years to 58.8 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 3.79% as of March 31, 2026. 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 March 31, 2026 and 2025. No cash paid for operating lease liabilities was capitalized during the three months ended March 31, 2026 and 2025.
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 March 31, 2026 (in thousands).
Future Minimum Lease Payments
April 1, 2026 - December 31, 2026
 $ 707 
2027 1,355 
2028 1,380 
2029 1,108 
2030 1,098 
2031 833 
Thereafter 11,149 
Total 17,630 
Less: imputed interest 5,499 
Total $ 12,131 
Leases
Note 11 – Leases
Lessor
As of March 31, 2026, the Company’s operating leases have non-cancelable lease terms ranging from 0.1 years to 15.4 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 March 31,
2026 2025
Fixed:
Cash rental revenue $ 26,511  $ 23,642 
Straight-line rental revenue (1,830) 3,631 
Lease intangible amortization 150  250 
Fixed property operating cost reimbursements 1,659  1,509 
Other fixed rental revenue 1,900  703 
Total fixed 28,390  29,735 
Variable:
Variable property operating cost reimbursements 7,208  7,460 
Other variable rental revenue 536  602 
Total variable 7,744  8,062 
Total rental revenue $ 36,134  $ 37,797 
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 March 31, 2026 (in thousands).
Future Minimum
Base Rent Payments
April 1, 2026 - December 31, 2026
 $ 66,026 
2027 82,565 
2028 73,809 
2029 58,591 
2030 56,722 
2031 52,473 
Thereafter 281,589 
Total $ 671,775 
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 March 31, 2026, the Company’s operating leases had remaining lease terms ranging from 2.8 years to 58.8 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 3.79% as of March 31, 2026. 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 March 31, 2026 and 2025. No cash paid for operating lease liabilities was capitalized during the three months ended March 31, 2026 and 2025.
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 March 31, 2026 (in thousands).
Future Minimum Lease Payments
April 1, 2026 - December 31, 2026
 $ 707 
2027 1,355 
2028 1,380 
2029 1,108 
2030 1,098 
2031 833 
Thereafter 11,149 
Total 17,630 
Less: imputed interest 5,499 
Total $ 12,131