Quarterly report [Sections 13 or 15(d)]

Leases

v3.26.3
Leases
 9 Months Ended
Sep. 30, 2026
Leases [Abstract]  
Leases
Note 11 – Leases
Lessor
As of September 30, 2026, the Company’s operating leases have non-cancelable lease terms ranging from 0.1 years to 15.0 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 September 30, Nine Months Ended September 30,
2026 2025 2026 2025
Fixed:
Cash rental revenue $ 21,932  $ 21,469  $ 70,977  $ 68,001 
Straight-line rental revenue 3,109  4,898  4,277  11,048 
Lease intangible amortization 72  137  313  593 
Fixed property operating cost reimbursements 1,790  1,526  5,160  4,554 
Other fixed rental revenue —  432  2,043  1,927 
Total fixed 26,903  28,462  82,770  86,123 
Variable:
Variable property operating cost reimbursements 7,759  7,889  20,988  23,929 
Other variable rental revenue 573  567  1,709  1,765 
Total variable 8,332  8,456  22,697  25,694 
Total rental revenue $ 35,235  $ 36,918  $ 105,467  $ 111,817 
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 September 30, 2026 (in thousands).
Future Minimum
Base Rent Payments
October 1, 2026 - December 31, 2026
 $ 21,013 
2027 85,374 
2028 79,657 
2029 65,151 
2030 61,910 
2031 56,680 
Thereafter 297,841 
Total $ 667,626 
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 September 30, 2026, the Company’s operating leases had remaining lease terms ranging from 2.3 years to 58.3 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 3.62% as of September 30, 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 September 30, 2026 and 2025, and $0.9 million for the nine months ended September 30, 2026 and 2025. Operating lease costs were included in property operating and general and administrative expenses in the consolidated statements of operations. No cash paid for operating lease liabilities was capitalized during the three and nine months ended September 30, 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 September 30, 2026 (in thousands).
Future Minimum Lease Payments
October 1, 2026 - December 31, 2026
 $ 306 
2027 1,239 
2028 1,262 
2029 990 
2030 980 
2031 715 
Thereafter 8,445 
Total 13,937 
Less: imputed interest 3,905 
Total $ 10,032 
The Company’s lease liability is included in Other liabilities, net in the consolidated balance sheets.
Leases
Note 11 – Leases
Lessor
As of September 30, 2026, the Company’s operating leases have non-cancelable lease terms ranging from 0.1 years to 15.0 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 September 30, Nine Months Ended September 30,
2026 2025 2026 2025
Fixed:
Cash rental revenue $ 21,932  $ 21,469  $ 70,977  $ 68,001 
Straight-line rental revenue 3,109  4,898  4,277  11,048 
Lease intangible amortization 72  137  313  593 
Fixed property operating cost reimbursements 1,790  1,526  5,160  4,554 
Other fixed rental revenue —  432  2,043  1,927 
Total fixed 26,903  28,462  82,770  86,123 
Variable:
Variable property operating cost reimbursements 7,759  7,889  20,988  23,929 
Other variable rental revenue 573  567  1,709  1,765 
Total variable 8,332  8,456  22,697  25,694 
Total rental revenue $ 35,235  $ 36,918  $ 105,467  $ 111,817 
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 September 30, 2026 (in thousands).
Future Minimum
Base Rent Payments
October 1, 2026 - December 31, 2026
 $ 21,013 
2027 85,374 
2028 79,657 
2029 65,151 
2030 61,910 
2031 56,680 
Thereafter 297,841 
Total $ 667,626 
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 September 30, 2026, the Company’s operating leases had remaining lease terms ranging from 2.3 years to 58.3 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 3.62% as of September 30, 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 September 30, 2026 and 2025, and $0.9 million for the nine months ended September 30, 2026 and 2025. Operating lease costs were included in property operating and general and administrative expenses in the consolidated statements of operations. No cash paid for operating lease liabilities was capitalized during the three and nine months ended September 30, 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 September 30, 2026 (in thousands).
Future Minimum Lease Payments
October 1, 2026 - December 31, 2026
 $ 306 
2027 1,239 
2028 1,262 
2029 990 
2030 980 
2031 715 
Thereafter 8,445 
Total 13,937 
Less: imputed interest 3,905 
Total $ 10,032 
The Company’s lease liability is included in Other liabilities, net in the consolidated balance sheets.