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Leases | 9 Months Ended
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Sep. 30, 2025
Leases [Abstract] |
Leases | Leases Lease Income The following table summarizes the Company’s lease income (in thousands):
| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Fixed income from operating leases | $ | 392,915 |  |  | $ | 394,263 |  |  | $ | 1,178,305 |  |  | $ | 1,141,901 |
Variable income from operating leases | 146,971 |  |  | 148,988 |  |  | 429,409 |  |  | 410,164 |
Initial Direct Costs Initial direct costs incurred in connection with successful property leasing are capitalized as deferred leasing costs. Initial direct costs include only those costs that are incremental to the arrangement and would not have been incurred if the lease had not been obtained, such as leasing commissions paid to employees and external third-party brokers and lease incentives. Initial direct costs are included in other assets, net in the Consolidated Balance Sheets and amortized in depreciation and amortization in the Consolidated Statements of Operations using the straight-line method over the lease term. At September 30, 2025 and December 31, 2024, the balance of net initial direct costs were $210 million and $204 million, respectively. Straight-Line Rents For operating leases with minimum scheduled rent increases, the Company recognizes income on a straight-line basis over the lease term when collectibility of future minimum lease payments is probable. If the Company determines that collectibility of future minimum lease payments is not probable, the straight-line rent receivable balance is written off and recognized as a decrease in revenue in that period and future revenue recognition is limited to amounts contractually owed and paid. The Company does not resume recognition of income on a straight-line basis unless it determines that collectibility of future payments related to these leases is probable. For the Company’s portfolio of operating leases that are deemed probable of collection but exhibit a certain level of collectibility risk, the Company may also recognize an incremental allowance as a reduction to revenue. At September 30, 2025 and December 31, 2024, straight-line rent receivable, net of allowance, excluding amounts reported in assets held for sale, net, was $368 million and $338 million, respectively. Straight-line rent receivable is included in other assets, net in the Consolidated Balance Sheets. At September 30, 2025 and December 31, 2024, straight-line rent receivable, net of allowance, reported in assets held for sale, net, was $0.8 million and zero, respectively. Tenant Updates In July 2024, the Company executed an early lease renewal for approximately 2 million square feet leased by CommonSpirit Health (“CommonSpirit”). The renewal, which is subject to a master agreement, extended the weighted average lease term of existing leases from July 2027 to December 2035, amended the contractual rents to current market rates, and increased the annual contractual lease escalations from 2.5% to 3.0%. In connection with this extension, CommonSpirit was provided the right to reduce the amount of space leased by up to approximately 200,000 square feet at any time after the original lease maturity dates. These termination rights were evaluated for likelihood of exercise in accordance with ASC 842, Leases, in the determination of the lease term. During each of the three and nine months ended September 30, 2025, CommonSpirit represented 6% of revenues for the outpatient medical segment and 3% of total revenues. On October 26, 2023, the Company amended its lease with Graphite Bio, Inc., which later merged with LENZ Therapeutics, Inc. in March 2024 (“Graphite Bio”), at one of its lab buildings in South San Francisco, California. Under the terms of the amended lease agreement, Graphite Bio’s lease expiration date was accelerated from April 2033 to December 2024 in exchange for an upfront cash payment of $37 million, comprised of a $21 million termination fee and $16 million prepayment of Graphite Bio’s contractual rent through the amended term. The $37 million was recognized as rental and related revenues on the Consolidated Statements of Operations on a straight-line basis through the amended term of the lease.
Leases | Leases Lease Income The following table summarizes the Company’s lease income (in thousands):
| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Fixed income from operating leases | $ | 392,915 |  |  | $ | 394,263 |  |  | $ | 1,178,305 |  |  | $ | 1,141,901 |
Variable income from operating leases | 146,971 |  |  | 148,988 |  |  | 429,409 |  |  | 410,164 |
Initial Direct Costs Initial direct costs incurred in connection with successful property leasing are capitalized as deferred leasing costs. Initial direct costs include only those costs that are incremental to the arrangement and would not have been incurred if the lease had not been obtained, such as leasing commissions paid to employees and external third-party brokers and lease incentives. Initial direct costs are included in other assets, net in the Consolidated Balance Sheets and amortized in depreciation and amortization in the Consolidated Statements of Operations using the straight-line method over the lease term. At September 30, 2025 and December 31, 2024, the balance of net initial direct costs were $210 million and $204 million, respectively. Straight-Line Rents For operating leases with minimum scheduled rent increases, the Company recognizes income on a straight-line basis over the lease term when collectibility of future minimum lease payments is probable. If the Company determines that collectibility of future minimum lease payments is not probable, the straight-line rent receivable balance is written off and recognized as a decrease in revenue in that period and future revenue recognition is limited to amounts contractually owed and paid. The Company does not resume recognition of income on a straight-line basis unless it determines that collectibility of future payments related to these leases is probable. For the Company’s portfolio of operating leases that are deemed probable of collection but exhibit a certain level of collectibility risk, the Company may also recognize an incremental allowance as a reduction to revenue. At September 30, 2025 and December 31, 2024, straight-line rent receivable, net of allowance, excluding amounts reported in assets held for sale, net, was $368 million and $338 million, respectively. Straight-line rent receivable is included in other assets, net in the Consolidated Balance Sheets. At September 30, 2025 and December 31, 2024, straight-line rent receivable, net of allowance, reported in assets held for sale, net, was $0.8 million and zero, respectively. Tenant Updates In July 2024, the Company executed an early lease renewal for approximately 2 million square feet leased by CommonSpirit Health (“CommonSpirit”). The renewal, which is subject to a master agreement, extended the weighted average lease term of existing leases from July 2027 to December 2035, amended the contractual rents to current market rates, and increased the annual contractual lease escalations from 2.5% to 3.0%. In connection with this extension, CommonSpirit was provided the right to reduce the amount of space leased by up to approximately 200,000 square feet at any time after the original lease maturity dates. These termination rights were evaluated for likelihood of exercise in accordance with ASC 842, Leases, in the determination of the lease term. During each of the three and nine months ended September 30, 2025, CommonSpirit represented 6% of revenues for the outpatient medical segment and 3% of total revenues. On October 26, 2023, the Company amended its lease with Graphite Bio, Inc., which later merged with LENZ Therapeutics, Inc. in March 2024 (“Graphite Bio”), at one of its lab buildings in South San Francisco, California. Under the terms of the amended lease agreement, Graphite Bio’s lease expiration date was accelerated from April 2033 to December 2024 in exchange for an upfront cash payment of $37 million, comprised of a $21 million termination fee and $16 million prepayment of Graphite Bio’s contractual rent through the amended term. The $37 million was recognized as rental and related revenues on the Consolidated Statements of Operations on a straight-line basis through the amended term of the lease.
Lessee | Leases Lease Income The following table summarizes the Company’s lease income (in thousands):
| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Fixed income from operating leases | $ | 392,915 |  |  | $ | 394,263 |  |  | $ | 1,178,305 |  |  | $ | 1,141,901 |
Variable income from operating leases | 146,971 |  |  | 148,988 |  |  | 429,409 |  |  | 410,164 |
Initial Direct Costs Initial direct costs incurred in connection with successful property leasing are capitalized as deferred leasing costs. Initial direct costs include only those costs that are incremental to the arrangement and would not have been incurred if the lease had not been obtained, such as leasing commissions paid to employees and external third-party brokers and lease incentives. Initial direct costs are included in other assets, net in the Consolidated Balance Sheets and amortized in depreciation and amortization in the Consolidated Statements of Operations using the straight-line method over the lease term. At September 30, 2025 and December 31, 2024, the balance of net initial direct costs were $210 million and $204 million, respectively. Straight-Line Rents For operating leases with minimum scheduled rent increases, the Company recognizes income on a straight-line basis over the lease term when collectibility of future minimum lease payments is probable. If the Company determines that collectibility of future minimum lease payments is not probable, the straight-line rent receivable balance is written off and recognized as a decrease in revenue in that period and future revenue recognition is limited to amounts contractually owed and paid. The Company does not resume recognition of income on a straight-line basis unless it determines that collectibility of future payments related to these leases is probable. For the Company’s portfolio of operating leases that are deemed probable of collection but exhibit a certain level of collectibility risk, the Company may also recognize an incremental allowance as a reduction to revenue. At September 30, 2025 and December 31, 2024, straight-line rent receivable, net of allowance, excluding amounts reported in assets held for sale, net, was $368 million and $338 million, respectively. Straight-line rent receivable is included in other assets, net in the Consolidated Balance Sheets. At September 30, 2025 and December 31, 2024, straight-line rent receivable, net of allowance, reported in assets held for sale, net, was $0.8 million and zero, respectively. Tenant Updates In July 2024, the Company executed an early lease renewal for approximately 2 million square feet leased by CommonSpirit Health (“CommonSpirit”). The renewal, which is subject to a master agreement, extended the weighted average lease term of existing leases from July 2027 to December 2035, amended the contractual rents to current market rates, and increased the annual contractual lease escalations from 2.5% to 3.0%. In connection with this extension, CommonSpirit was provided the right to reduce the amount of space leased by up to approximately 200,000 square feet at any time after the original lease maturity dates. These termination rights were evaluated for likelihood of exercise in accordance with ASC 842, Leases, in the determination of the lease term. During each of the three and nine months ended September 30, 2025, CommonSpirit represented 6% of revenues for the outpatient medical segment and 3% of total revenues. On October 26, 2023, the Company amended its lease with Graphite Bio, Inc., which later merged with LENZ Therapeutics, Inc. in March 2024 (“Graphite Bio”), at one of its lab buildings in South San Francisco, California. Under the terms of the amended lease agreement, Graphite Bio’s lease expiration date was accelerated from April 2033 to December 2024 in exchange for an upfront cash payment of $37 million, comprised of a $21 million termination fee and $16 million prepayment of Graphite Bio’s contractual rent through the amended term. The $37 million was recognized as rental and related revenues on the Consolidated Statements of Operations on a straight-line basis through the amended term of the lease.

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- Definition The entire disclosure for operating leases of lessee. Includes, but is not limited to, description of operating lease and maturity analysis of operating lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 842 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/842-20/tableOfContent + Details
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