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LEASES
 9 Months Ended
Sep. 30, 2025
Leases [Abstract]  
LEASES LEASES
Lessor Operating Leases

We determine if an arrangement is a lease at inception. Our lease agreements are generally for real estate, and the determination of whether such agreements contain leases generally does not require significant estimates or judgments. We lease real estate under operating leases.
Our leases with office, retail, mixed-use and residential tenants are classified as operating leases. Leases at our office and retail properties and the retail portion of our mixed-use property generally range from three years to ten years (certain leases with anchor tenants may be longer), and in addition to minimum rents, usually provide for cost recoveries for the tenant’s share of certain operating costs. Our leases may also include variable lease payments in the form of percentage rents based on the tenant’s level of sales achieved in excess of a breakpoint threshold. Leases on apartments generally range from seven months to fifteen months, with a majority having 12-month lease terms. Rooms at the hotel portion of our mixed-use property are rented on a nightly basis.
Leases at our office and retail properties and the retail portion of our mixed-use property may contain lease extension options, at our lessee's discretion. The extension options are generally for 3 to 10 years and contain primarily rent at fixed rates or the prevailing market rent. The extension options are generally exercisable 6 to 12 months prior to the expiration of the lease and require the lessee to not be in default of the lease terms.
We attempt to maximize the amount we expect to derive from the underlying real estate property following the end of a lease, to the extent it is not extended.  We maintain a proactive leasing and capital improvement program that, combined with the quality and locations of our properties, has made our properties attractive to tenants. However, the residual value of a real estate property is still subject to various market-specific, asset-specific, and tenant-specific risks and characteristics. 
As of September 30, 2025, minimum future rentals from noncancelable operating leases, before any reserve for uncollectible amounts and assuming no early lease terminations, at our office and retail properties and the retail portion of our mixed-use property are as follows for the years ended December 31 (in thousands):
 
2025 (three months ending December 31, 2025)$57,799 
2026252,343 
2027236,610 
2028191,687 
2029131,993 
Thereafter278,031 
Total$1,148,463 
 
The above future minimum rentals exclude residential leases, which typically range from seven months to fifteen months, and exclude the hotel, as rooms are rented on a nightly basis.
Lessee Operating Leases
We determine if an arrangement is a lease at inception. Our lease agreements are generally for real estate, and the determination of whether such agreements contain leases generally does not require significant estimates or judgments. We lease real estate under operating leases.
At The Landmark at One Market, we lease, as lessee, a building adjacent to The Landmark at One Market under an operating lease effective through June 30, 2031 (the “Annex Lease”). We exercised the final extension option which was effective as of July 1, 2025. The lease payments under the Annex Lease are equal to the fair rental value at the time the extension option is exercised.
Our lease agreements do not contain any residual value guarantees or material restrictive covenants. As our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement in determining the present value of lease payments.
As of September 30, 2025, current annual payments under the operating leases are as follows for the years ended December 31 (in thousands): 
2025 (three months ending December 31, 2025)$896 
20263,584 
20273,637 
20283,746 
20293,859 
Thereafter5,991 
Total lease payments21,713 
Imputed interest(2,220)
Present value of lease liability$19,493 

Lease costs under the operating leases are as follows (in thousands):    
Three Months Ended September 30,Nine Months Ended September 30,
2025202420252024
Operating lease cost$956 $970 $2,775 $2,756 
Sublease income(851)(880)(2,569)(2,558)
Total lease cost (income)$105 $90 $206 $198 
Weighted-average remaining lease term - operating leases (in years)5.8
Weighted-average discount rate - operating leases3.19 %
Supplemental cash flow information and non-cash activity related to our operating leases are as follow (in thousands):
Nine Months Ended September 30,
20252024
Operating cash flow information:
Cash paid for amounts included in the measurement of lease liabilities$2,636 $2,559 

Subleases
At The Landmark at One Market, we (as sublandlord) sublease the Annex Lease building under operating leases effective through December 31, 2029. The subleases contain extension options, subject to our ability to extend the Annex Lease, that can extend the subleases through December 31, 2039 at the fair rental value at the time the extension option is exercised.
LEASES LEASES
Lessor Operating Leases

We determine if an arrangement is a lease at inception. Our lease agreements are generally for real estate, and the determination of whether such agreements contain leases generally does not require significant estimates or judgments. We lease real estate under operating leases.
Our leases with office, retail, mixed-use and residential tenants are classified as operating leases. Leases at our office and retail properties and the retail portion of our mixed-use property generally range from three years to ten years (certain leases with anchor tenants may be longer), and in addition to minimum rents, usually provide for cost recoveries for the tenant’s share of certain operating costs. Our leases may also include variable lease payments in the form of percentage rents based on the tenant’s level of sales achieved in excess of a breakpoint threshold. Leases on apartments generally range from seven months to fifteen months, with a majority having 12-month lease terms. Rooms at the hotel portion of our mixed-use property are rented on a nightly basis.
Leases at our office and retail properties and the retail portion of our mixed-use property may contain lease extension options, at our lessee's discretion. The extension options are generally for 3 to 10 years and contain primarily rent at fixed rates or the prevailing market rent. The extension options are generally exercisable 6 to 12 months prior to the expiration of the lease and require the lessee to not be in default of the lease terms.
We attempt to maximize the amount we expect to derive from the underlying real estate property following the end of a lease, to the extent it is not extended.  We maintain a proactive leasing and capital improvement program that, combined with the quality and locations of our properties, has made our properties attractive to tenants. However, the residual value of a real estate property is still subject to various market-specific, asset-specific, and tenant-specific risks and characteristics. 
As of September 30, 2025, minimum future rentals from noncancelable operating leases, before any reserve for uncollectible amounts and assuming no early lease terminations, at our office and retail properties and the retail portion of our mixed-use property are as follows for the years ended December 31 (in thousands):
 
2025 (three months ending December 31, 2025)$57,799 
2026252,343 
2027236,610 
2028191,687 
2029131,993 
Thereafter278,031 
Total$1,148,463 
 
The above future minimum rentals exclude residential leases, which typically range from seven months to fifteen months, and exclude the hotel, as rooms are rented on a nightly basis.
Lessee Operating Leases
We determine if an arrangement is a lease at inception. Our lease agreements are generally for real estate, and the determination of whether such agreements contain leases generally does not require significant estimates or judgments. We lease real estate under operating leases.
At The Landmark at One Market, we lease, as lessee, a building adjacent to The Landmark at One Market under an operating lease effective through June 30, 2031 (the “Annex Lease”). We exercised the final extension option which was effective as of July 1, 2025. The lease payments under the Annex Lease are equal to the fair rental value at the time the extension option is exercised.
Our lease agreements do not contain any residual value guarantees or material restrictive covenants. As our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement in determining the present value of lease payments.
As of September 30, 2025, current annual payments under the operating leases are as follows for the years ended December 31 (in thousands): 
2025 (three months ending December 31, 2025)$896 
20263,584 
20273,637 
20283,746 
20293,859 
Thereafter5,991 
Total lease payments21,713 
Imputed interest(2,220)
Present value of lease liability$19,493 

Lease costs under the operating leases are as follows (in thousands):    
Three Months Ended September 30,Nine Months Ended September 30,
2025202420252024
Operating lease cost$956 $970 $2,775 $2,756 
Sublease income(851)(880)(2,569)(2,558)
Total lease cost (income)$105 $90 $206 $198 
Weighted-average remaining lease term - operating leases (in years)5.8
Weighted-average discount rate - operating leases3.19 %
Supplemental cash flow information and non-cash activity related to our operating leases are as follow (in thousands):
Nine Months Ended September 30,
20252024
Operating cash flow information:
Cash paid for amounts included in the measurement of lease liabilities$2,636 $2,559 

Subleases
At The Landmark at One Market, we (as sublandlord) sublease the Annex Lease building under operating leases effective through December 31, 2029. The subleases contain extension options, subject to our ability to extend the Annex Lease, that can extend the subleases through December 31, 2039 at the fair rental value at the time the extension option is exercised.