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LEASES | 3 Months Ended
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Sep. 29, 2021
Leases [Abstract] |
Leases | We typically lease our restaurant facilities through ground leases (where we lease land only, but construct the building and improvements) or retail leases (where we lease the land/retail space and building). In addition to our restaurant facilities, we also lease our corporate headquarters location and certain equipment. Lease Amounts Included in the Consolidated Statements of Comprehensive Income (Unaudited) The components of lease expenses included in the Consolidated Statements of Comprehensive Income (Unaudited) were as follows:
|  |  | Thirteen Week Periods Ended
|  |  |  |  | September 29, 2021 |  | September 23, 2020
Operating lease cost |  |  |  |  | $ | 41.4 |  |  | $ | 41.7 |
Variable lease cost |  |  |  |  | 15.1 |  |  | 14.0 |
Finance lease amortization |  |  |  |  | 5.6 |  |  | 4.0 |
Finance lease interest |  |  |  |  | 1.6 |  |  | 1.5 |
Short-term lease cost |  |  |  |  | 0.1 |  |  | 0.1 |
Sublease income |  |  |  |  | (1.1) |  |  | (1.0) |
Total lease costs, net |  |  |  |  | $ | 62.7 |  |  | $ | 60.3 |
Pre-Commencement Leases In the first quarter of fiscal 2022, we executed 16 leases for new Chili’s locations with undiscounted fixed payments over the initial term of $24.7 million. These leases are expected to commence in the next 12 months and are expected to have an economic lease term of 20 years. These leases will commence when the landlords make the property available to us for new restaurant construction. We will assess the reasonably certain lease term at the lease commencement date. Significant Changes in Leases during the Period In the first quarter of fiscal 2022, as part of the Chili’s restaurant acquisition, we assumed 11 new real estate operating leases included in the balances at September 29, 2021. The leases were recorded net of prepaid rent at the date of acquisition. At September 29, 2021, the balances associated with these new leases in the Consolidated Balance Sheets (Unaudited) include Operating lease assets of $23.6 million, Operating lease liabilities of $0.6 million, and Long-term operating lease liabilities, less current portion of $23.0 million. The leases were recorded net of purchase price accounting adjustments and prepaid rent. Refer to Note 2 - Chili’s Restaurant Acquisition for further details. Restaurant Properties Sale Leaseback Transaction In the first quarter of fiscal 2022, simultaneous with the acquisition of the 23 Chili’s restaurants, we completed sale leaseback transactions on six of the acquired restaurants. The properties were sold at their acquisition cost resulting in proceeds of $20.5 million with no gain or loss. The initial terms of all leases we entered into as part of the sale leaseback transactions are for 15 years, plus renewal options at our discretion. All of the leases were determined to be operating leases. Rent expenses associated with these operating leases are recognized on a straight-line basis over the lease terms under ASC 842. At September 29, 2021, the balances associated with these new leases in the Consolidated Balance Sheets (Unaudited) include Operating lease assets of $18.2 million, Operating lease liabilities of $0.4 million, and Long-term operating lease liabilities, less current portion of $17.8 million.

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- Definition Disclosure of accounting policy for leasing arrangement entered into by lessee. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 20 -Section 50 -Paragraph 1 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=123408670&loc=SL77918666-209980 + Details
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