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LEASE REVENUE LEASE REVENUE | 9 Months Ended
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Sep. 30, 2019
Lease Revenue [Abstract] |
Operating Lease, Lease Income [Text Block] | LEASE REVENUE The Company’s primary revenue is rental income from business distribution space. In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842), and in subsequent periods, issued ASU 2018-10, 2018-11, and 2018-20, all of which relate to the new lease accounting guidance. The Company adopted the new lease accounting guidance effective January 1, 2019, and has applied its provisions on a prospective basis. Lessor accounting is largely unchanged under ASU 2016-02. The Company’s primary revenue is rental income; as such, the Company is a lessor on a significant number of leases. The Company is continuing to account for its leases in substantially the same manner. The most significant changes for the Company related to lessor accounting include: (i) the new standard’s narrow definition of initial direct costs for leases, and (ii) the guidance applicable to recording uncollectible rents, as discussed in the following paragraphs. The new standard’s narrow definition of initial direct costs for leases — The new definition of initial direct costs results in certain costs (primarily legal costs related to lease negotiations) being expensed rather than capitalized upon adoption of the new standard. EastGroup recorded Indirect leasing costs of $110,000 and $306,000 on the Consolidated Statements of Income and Comprehensive Income during the three and nine months ended September 30, 2019. The guidance applicable to recording uncollectible rents — Upon adoption of the lease accounting guidance, reserves for uncollectible accounts are recorded as a reduction to revenue. Prior to adoption, reserves for uncollectible accounts were recorded as bad debt expenses. The standard also provides guidance related to calculating the reserves; however, those changes did not impact the Company. EastGroup has elected the practical expedient permitting lessors to make an accounting policy election by class of underlying asset to not separate non-lease components (such as common area maintenance) of a contract from the lease component to which they relate when specific criteria are met. The Company believes its leases meet the criteria. The Company has applied the provisions of the new lease accounting standard and provided the required disclosures in this Quarterly Report on Form 10-Q. The table below presents the components of Income from real estate operations for the three and nine months ended September 30, 2019:
| Three Months Ended September 30, 2019 |  | Nine Months Ended September 30, 2019
| (In thousands)
Lease income — operating leases | $ | 62,901 |  |  | 183,271 |
Variable lease income (1) | 21,012 |  |  | 61,062 |
Income from real estate operations | $ | 83,913 |  |  | 244,333 |
(1) | Primarily includes tenant reimbursements for real estate taxes, insurance and common area maintenance.
Future Minimum Rental Receipts Under Non-Cancelable Leases The Company’s leases with its customers may include various provisions such as scheduled rent increases, renewal options and termination options. The majority of the Company’s leases include defined rent increases rather than variable payments based on an index or unknown rate. In calculating the disclosures presented below, the Company included the fixed, non-cancelable terms of the leases. The following schedule indicates approximate future minimum rental receipts under non-cancelable leases for real estate properties by year as of September 30, 2019:
Years Ending December 31, |  | (In thousands)
2019 - Remainder of year |  | $ | 62,995 |
2020 |  | 242,199 |
2021 |  | 200,587 |
2022 |  | 156,626 |
2023 |  | 120,445 |
Thereafter |  | 249,075 |
Total minimum receipts |  | $ | 1,031,927 |
As noted above, the Company adopted the new lease accounting guidance effective January 1, 2019. Since the Company has applied the provisions on a prospective basis, the following represents approximate future minimum rental receipts under non-cancelable leases for real estate properties by year as of December 31, 2018, as applicable under ASC 840, Leases, prior to the adoption of ASC 842.
Years Ending December 31, |  | (In thousands)
2019 |  | $ | 226,330 |
2020 |  | 195,850 |
2021 |  | 151,564 |
2022 |  | 112,007 |
2023 |  | 82,262 |
Thereafter |  | 163,499 |
Total minimum receipts |  | $ | 931,512 |

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- Definition The entire disclosure for lessor's operating leases. + References Reference 1: http://www.xbrl.org/2003/role/exampleRef -Publisher FASB -Name Accounting Standards Codification -Topic 840 -SubTopic 10 -Section 55 -Paragraph 40 -Subparagraph Note 1 -URI http://asc.fasb.org/extlink&oid=82846649&loc=d3e38371-112697 Reference 2: http://www.xbrl.org/2003/role/exampleRef -Publisher FASB -Name Accounting Standards Codification -Topic 840 -SubTopic 10 -Section 55 -Paragraph 40 -Subparagraph Note 3 -URI http://asc.fasb.org/extlink&oid=82846649&loc=d3e38371-112697 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 30 -URI http://asc.fasb.org/subtopic&trid=77888252 + Details
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