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Note 10 - Leases

12 Months Ended

Dec. 31, 2023

NOTE 10. LEASES

We have operating and finance leases primarily for four casino hotel properties, corporate offices, parking ramps, gaming and other equipment. Our leases have remaining lease terms of one year to 53 years, some of which include options to extend the leases for up to 62 years, and some of which include options to terminate the leases within one year. Certain of our lease agreements, including the Master Leases, include provisions for variable lease payments, which represent lease payments that vary due to changes in facts or circumstances occurring after the commencement date other than the passage of time. Such variable lease payments are expensed in the period in which the obligation for these payments is incurred. Variable lease expense recognized in the years ended December 31, 2023, 2022 and 2021 was $34.9 million, $22.4 million and $20.1 million, respectively.

As part of our annual 2021 impairment test, the Company recorded impairment charges of $5.8 million for operating lease right-of-use assets related to our Las Vegas Locals segment.

The components of lease expense were as follows:

	*Year Ended December 31,*
*(In thousands)*	*2023*		*2022*
Operating lease cost	$	161,190	$	153,961
Short-term lease cost		—		(685	)

Supplemental cash flow information related to leases was as follows:

	*Year Ended December 31,*
*(In thousands)*	*2023*		*2022*
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	158,785	$	155,085

Right-of-use assets obtained in exchange for lease obligations:
Operating leases		41,840		32,080

Supplemental balance sheet information related to leases was as follows:

	*December 31,*
*(In thousands, except lease term and discount rate)*	*2023*			*2022*
Operating Leases
Operating lease right-of-use assets, including favorable lease rates asset	$	793,335		$	830,345

Current lease liabilities (included in accrued liabilities)	$	98,867		$	88,776
Operating lease liabilities		711,387			758,440
Total operating lease liabilities	$	810,254		$	847,216

Weighted Average Remaining Lease Term
Operating leases (in years)		14.9			15.5

Weighted Average Discount Rate
Operating leases		8.4	%		8.7	%

Maturities of lease liabilities are as follows:

*(In thousands)*	*Operating Leases*
*For the year ending December 31,*
2024	$	157,839
2025		157,609
2026		121,211
2027		120,324
2028		119,623
Thereafter		790,691
Total lease payments		1,467,297
Less imputed interest		(657,043	)
Less current portion (included in accrued liabilities)		(98,867	)
Long-term portion of operating lease liabilities	$	711,387

Future minimum rental income, which is primarily related to retail and restaurant facilities located within our properties, is as follows:

*(In thousands)*	*Minimum Rental Income*
*For the year ending December 31,*
2024	$	2,733
2025		1,209
2026		544
2027		456
2028		371
Thereafter		665
Total	$	5,978