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Leases
6 Months Ended
Jun. 30, 2020
Leases [Abstract]  
Leases

9. Leases

We have various non-cancelable lease agreements for certain of our offices with original lease periods expiring between 2020 and 2032. Our lease terms may include options to extend or terminate the lease when it is reasonably certain we will exercise that option. Certain of the arrangements have free rent periods or escalating rent payment provisions. Leases with an initial term of twelve months or less are not recorded on the consolidated balance sheets. We recognize rent expense on a straight-line basis over the lease term. Additionally, we sublease certain operating leases to third parties primarily as a result of moving to a centralized corporate office in Santa Monica, California in 2018.

Lease Cost

The components of lease cost were as follows:

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

 

(in thousands)

 

Operating lease expense

$

15,334

 

 

$

13,206

 

 

$

29,739

 

 

$

26,887

 

Sublease income

 

(793

)

 

 

(1,268

)

 

 

(1,535

)

 

 

(2,193

)

Total net lease costs

$

14,541

 

 

$

11,938

 

 

$

28,204

 

 

$

24,694

 

Lease Term and Discount Rate

The weighted-average remaining lease term (in years) and discount rate related to the operating leases were as follows:

 

 

Six Months Ended June 30,

 

 

2020

 

 

 

 

2019

 

Weighted-average remaining lease term

 

7.7

 

 

 

 

 

7.1

 

Weighted-average discount rate

 

5.6

%

 

 

 

 

6.2

%

As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the lease commencement date to determine the present value of lease payments.

Maturity of Lease Liabilities

The present value of our operating lease liabilities as of June 30, 2020 were as follows:

 

 

 

 

 

 

Operating Leases

 

 

 

 

 

 

(in thousands)

 

Remainder of 2020

 

 

 

 

$

26,670

 

2021

 

 

 

 

 

65,428

 

2022

 

 

 

 

 

56,572

 

2023

 

 

 

 

 

52,415

 

2024

 

 

 

 

 

52,061

 

Thereafter

 

 

 

 

 

143,745

 

Total lease payments

 

 

 

 

$

396,891

 

Less: Imputed interest

 

 

 

 

 

(76,063

)

Present value of lease liabilities

 

 

 

 

$

320,828

 

As of June 30, 2020, we have additional operating leases for facilities that have not yet commenced with lease obligations of $18.6 million. These operating leases will commence between 2020 and 2021 with lease terms of greater than one years to five years. This table does not include lease payments that were not fixed at commencement or modification.

Other Information

Cash payments included in the measurement of our operating lease liabilities were $17.2 million and $16.7 million for the three months ended June 30, 2020 and 2019, respectively, and $38.3 million and $33.2 million for the six months ended June 30, 2020 and 2019, respectively.

Lease liabilities arising from obtaining operating lease right-of-use assets were not material for the six months ended June 30, 2020 and 2019, respectively.