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LEASES | 3 Months Ended
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Mar. 31, 2022
Leases [Abstract] |
LEASES | LEASES The Company leases the land underlying certain of its properties, real estate, and various equipment under operating and, to a lesser extent, finance lease arrangements. The MGP master lease, which is further discussed in Note 12, eliminates in consolidation and, accordingly, is not included within the disclosures below. Land. As of March 31, 2022, the Company, through MGP, was a lessee of land underlying MGM National Harbor and a portion of the land underlying Borgata and Beau Rivage. MGP was obligated to make lease payments through the non-cancelable term of the ground leases, which is through 2051 for Beau Rivage, through 2070 for Borgata, and through 2082 for MGM National Harbor. Refer to Note 1 for discussion of the VICI Transaction. Additionally, MGM Grand Paradise has MGM Macau and MGM Cotai land concession contracts, each with an initial 25-year contract term ending in April 2031 and January 2038, respectively. The land leases are classified as operating leases. Real estate assets. The Company leases the real estate assets of Bellagio, Mandalay Bay, MGM Grand Las Vegas, and Aria (including Vdara) pursuant to triple-net lease agreements, which are classified as operating leases. Each of the leases obligates the Company to spend a specified percentage of net revenues at the properties on capital expenditures and that the Company comply with certain financial covenants, which, if not met, would require the Company to maintain cash security or provide one or more letters of credit in favor of the landlord in an amount equal to 1 year of rent under the Mandalay Bay and MGM Grand Las Vegas lease and Aria lease and 2 years of rent under the Bellagio lease. The Company was in compliance with its applicable covenants under its leases as of March 31, 2022. Other information. Components of lease costs and other information related to the Company’s leases was:
| Three Months Ended March 31,
| 2022 |  | 2021
| (In thousands)
Operating lease cost, primarily classified within "General and administrative"(1) | $ | 271,849 |  |  | $ | 198,991 |
Finance lease costs |  |  |
Interest expense(2) | $ | 893 |  |  | $ | (656) |
Amortization expense | 20,157 |  |  | 17,814 |
Total finance lease costs | $ | 21,050 |  |  | $ | 17,158 |
(1)The Bellagio lease and the Mandalay Bay and MGM Grand Las Vegas lease are held with related parties, as further discussed in Note 12. Operating lease cost includes $83 million for each of the three months ended March 31, 2022 and 2021 related to the Bellagio lease. Operating lease cost includes $99 million for each of the three months ended March 31, 2022 and 2021 related to the Mandalay Bay and MGM Grand Las Vegas lease. (2)For the three months ended March 31, 2021, interest expense includes the effect of COVID-19 related rent concessions which was recognized as negative variable rent expense.
| March 31, 2022 |  | December 31, 2021
Supplemental balance sheet information | (In thousands)
Operating leases |  |  |
Operating lease right-of-use assets, net(1) | $ | 11,438,442 |  |  | $ | 11,492,805 |
Operating lease liabilities - current, classified within "Other accrued liabilities" | $ | 31,806 |  |  | $ | 31,706 |
Operating lease liabilities - long-term(2) | 11,810,047 |  |  | 11,802,464 |
Total operating lease liabilities | $ | 11,841,853 |  |  | $ | 11,834,170 |
Finance leases |  |  |
Finance lease right-of-use assets, net classified within "Property and equipment, net" | $ | 131,739 |  |  | $ | 151,909 |
Finance lease liabilities - current, classified within "Other accrued liabilities" | $ | 82,975 |  |  | $ | 87,665 |
Finance lease liabilities - long-term, classified within "Other long-term obligations" | 57,534 |  |  | 75,560 |
Total finance lease liabilities | $ | 140,509 |  |  | $ | 163,225 |
Weighted-average remaining lease term (years) |  |  |
Operating leases | 29 |  | 29
Finance leases | 2 |  | 2
Weighted-average discount rate (%) |  |  |
Operating leases | 7 |  |  | 7 |
Finance leases | 3 |  |  | 3 |
(1)As of March 31, 2022 and December 31, 2021, operating lease right-of-use assets, net included $3.6 billion related to the Bellagio lease for each of the respective periods, and $3.9 billion and $4.0 billion related to the Mandalay Bay and MGM Grand Las Vegas lease, respectively. (2)As of March 31, 2022 and December 31, 2021, operating lease liabilities – long-term included $3.8 billion related to the Bellagio lease for each of the respective periods, and $4.2 billion related to the Mandalay Bay and MGM Grand Las Vegas lease for each of the respective periods.
| Three Months Ended March 31,
| 2022 |  | 2021
Cash paid for amounts included in the measurement of lease liabilities | (In thousands)
Operating cash outflows from operating leases | $ | 211,326 |  |  | $ | 154,504 |
Operating cash outflows from finance leases | 945 |  |  | 1,456 |
Financing cash outflows from finance leases(1) | 22,649 |  |  | 19,269 |
ROU assets obtained in exchange for new lease liabilities |  |  |
Operating leases | $ | 4,480 |  |  | $ | — |
Finance leases | — |  |  | — |
(1)Included within “Other” within “Cash flows from financing activities” on the consolidated statements of cash flows. Maturities of lease liabilities were as follows:
| Operating Leases |  | Finance Leases
Year ending December 31, | (In thousands)
2022 (excluding the three months ended March 31, 2022) | $ | 628,471 |  |  | $ | 66,982 |
2023 | 852,445 |  |  | 73,564 |
2024 | 864,857 |  |  | 1,742 |
2025 | 876,986 |  |  | 1,250 |
2026 | 886,720 |  |  | 24 |
Thereafter | 26,660,240 |  |  | — |
Total future minimum lease payments | 30,769,719 |  |  | 143,562 |
Less: Amount of lease payments representing interest | (18,927,866) |  |  | (3,053) |
Present value of future minimum lease payments | 11,841,853 |  |  | 140,509 |
Less: Current portion | (31,806) |  |  | (82,975) |
Long-term portion of lease liabilities | $ | 11,810,047 |  |  | $ | 57,534 |

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