LEASES

12 Months Ended

Dec. 31, 2023

The Company's operating leases primarily consist of real estate leases for office space. The Company also has operating leases for various types of office furniture and equipment. For certain equipment leases, the Company applies a portfolio approach to effectively account for the RoU operating lease assets and liabilities. For lease agreements for which the lease term or classification was reassessed after the occurrence of a change in the lease terms or a modification of the lease that did not result in a separate contract, the Company elected to combine the lease and related non-lease components for its operating leases; however, the non-lease components associated with the Company’s operating leases are primarily variable in nature and as such are not included in the determination of the RoU operating lease asset and lease liability, but are recognized in the period in which the obligation for those payments is incurred.

The Company’s operating leases may include options to extend or terminate the lease, which are not included in the determination of the RoU operating asset or lease liability unless they are reasonably certain to be exercised. The Company's operating leases have remaining lease terms of 1 year to 15 years, some of which include options to extend the leases. The Company typically does not include its renewal options in its lease terms for calculating its RoU operating lease asset and lease liability as the renewal options allow the Company to maintain operational flexibility and the Company is not reasonably certain it will exercise these renewal options until close to the initial end date of the lease. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.

As the Company's operating leases do not provide an implicit rate, the Company’s incremental borrowing rate, based on the information available at the lease commencement date, is used in determining the present value of lease payments.

The Company primarily subleases floor space within its New Jersey and New York lease properties to various third parties. The lease term for these subleases typically corresponds to the original lease term.

Balance Sheet Classification of Operating Lease Assets and Liabilities


		December 31,
	Balance Sheet Line Item	2023		2022
		(in millions)
Assets:
Operating lease assets	Other assets	$	516	$	520
Liabilities:
Operating lease liabilities	Other liabilities	$	579	$	618

The table below summarizes the components of lease costs:

Lease Costs


	Year Ended December 31,
	2023		2022		2021
	(in millions)
Operating lease cost	$	161	$	179	$	173
Variable operating lease cost	51		52		49
Sublease income	(53)		(53)		(55)
Short-term lease expense	—		—		—
Net lease cost	$	159	$	178	$	167

Maturities of lease liabilities are as follows:

Maturities of Lease Liabilities


	December 31, 2023
	(in millions)
Operating Leases:
2024	$	156
2025	86
2026	78
2027	69
2028	59
Thereafter	224
Total lease payments	672
Less: Interest	(93)
Present value of lease liabilities	$	579

AB signed a lease which commences in 2024, relating to approximately 166,000 square feet of space in New York City. AB estimated total base rent obligation (excluding taxes, operating expenses and utilities) over the 20 year lease term is approximately $393 million. Additionally, AB signed a lease for 100,000 square feet of space in Pune, India under a lease expiring in 2033.

Equitable Financial signed a 15-year lease which commenced in 2023, relating to approximately 89,000 square feet of space in New York City. Additionally, during December 2021, Equitable Financial amended its Syracuse office lease. The amendment included extending for an additional 5-year period, commencing January 1, 2024, approximately 143,000 square feet of space in Syracuse, NY.

The below table presents the Company’s weighted-average remaining operating lease term and weighted-average discount rate.

Weighted Averages - Remaining Operating Lease Term and Discount Rate


	December 31,
	2023		2022
Weighted-average remaining operating lease term	8 years		7 years
Weighted-average discount rate for operating leases	3.40	%	2.77	%

Supplemental cash flow information related to leases was as follows:

Lease Liabilities Information


	Year Ended December 31,
	2023		2022		2021
	(in millions)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	190	$	202	$	209
Non-cash transactions:
Leased assets obtained in exchange for new operating lease liabilities	$	124	$	46	$	109