Leases

6 Months Ended

Jun. 30, 2023

Our operating leases that have commenced have terms that expire beginning 2025 through 2031 and consist of office space and research and development laboratories, including our corporate headquarters. Certain of these lease agreements contain clauses for renewal at our option. As we were not reasonably certain to exercise any of these renewal options at commencement of the associated leases, no such options were recognized as part of our operating lease right-of-use, or ROU, assets or operating lease liabilities.

In connection with our operating leases, in lieu of a cash security deposits, Wells Fargo Bank, N.A. issued letters of credit on our behalf, which are secured by deposits totaling $7.8 million.

The following table presents supplemental operating lease information for operating leases that have commenced.


	Six Months Ended June 30,
(in millions, except weighted average data)	2023			2022
Operating lease cost	$	8.2		$	8.2
Cash paid for amounts included in the measurement of operating lease liabilities	$	8.8		$	8.2

	June 30, 2023			June 30, 2022
Weighted average remaining lease term	7.4 years			8.3 years
Weighted average discount rate	5.4		%	5.3		%

The following table presents approximate non-cancelable future minimum lease payments under operating leases as of June 30, 2023.


(in millions)	Amount (1)
2023 (6 months remaining)	$	9.1
2024	18.5
2025	17.0
2026	15.7
2027	16.0
Thereafter	54.4
Total operating lease payments	130.7
Less accreted interest	23.9
Total operating lease liabilities	106.8
Less current operating lease liabilities included in other current liabilities	17.7
Noncurrent operating lease liabilities	$	89.1

_________________________

(1) Amounts presented in the table above exclude $17.2 million for 2024, $33.3 million for 2025, $41.9 million for 2026, $43.2 million for 2027 and $436.5 million thereafter of approximate non-cancelable future minimum lease payments under operating leases that have not yet commenced.

New Campus Facility. On February 8, 2022, we entered into a lease agreement for a new four-building campus facility in San Diego, California. This campus facility, comprised of office space and research and development laboratories, will serve as our new corporate headquarters upon completion of its construction. Under the terms of the lease, we also secured a six-year option for the construction of a fifth building and an option to purchase the entire campus in the future.

Under the terms of the lease, on a building-by-building basis, base rent will be subject to a 10-month rent abatement period following the respective lease commencement date. After the rent abatement period, monthly base rent will be $6 per square foot, subject to annual escalations of 3% during the initial 13.6-year lease term, which term we have the option to renew for two additional terms of five years each.

The commencement of this lease for accounting purposes will be determined for each building based upon its readiness for occupancy. On a building-by-building basis, we will recognize a lease liability, corresponding right-of-use asset, and initiate lease expense recognition when this condition has been met.