The Company conducts part of its retail operations from leased facilities. The initial terms of the leases are generally 20 years. The majority of the leases include one or more renewal options and require that the Company pay property taxes, utilities, repairs and certain other costs incidental to occupation of the premises. Several leases contain clauses that require rental payments based on a percentage of gross sales of the supermarket occupying the leased space. Step rent provisions, escalation clauses and lease incentives are taken into account in computing minimum lease payments.

Operating lease cost for all operating leases totaled $2.6 million for the three months ended December 24, 2022. This amount included short-term (less than one year) leases, common area expenses, and variable lease costs, all of which are insignificant. Cash paid for lease liabilities in operating activities approximates operating lease cost.

Maturities of operating lease liabilities as of December 24, 2022 were as follows:


Fiscal Year
Remainder of 2023	$	6,866,375
2024		7,918,542
2025		7,117,834
2026		5,835,887
2027		4,985,637
Thereafter		22,320,055
Total lease payments	$	55,044,330
Less amount representing interest		11,513,520
Present value of lease liabilities	$	43,530,810

The weighted average remaining lease term for the Company’s operating leases is 12.8 years. The weighted average discount rate used to determine lease liability balances as of December 24, 2022 was 3.51%, based on our incremental borrowing rate.

At December 24, 2022, the Company owned and operated 89 shopping centers in conjunction with its supermarket operations. The Company leases to others a portion of its shopping center properties. The leases are non-cancelable operating lease agreements for terms ranging up to 20 years.

Rental income is included in the line item “Net sales” on the Consolidated Statements of Income. Depreciation on owned properties leased to others and other shopping center expenses are included in the line item “Cost of goods sold” on the Consolidated Statements of Income.


		Three Months Ended
		December 24, 2022
Rents earned on owned and subleased properties:
Base rentals	$	6,116,877
Variable rentals		41,722
Total		6,158,599
Depreciation on owned properties leased to others		(1,579,722)
Other shopping center expenses		(626,971)
Total	$	3,951,906


Fiscal Year
Remainder of 2023	$	13,494,540
2024		16,266,403
2025		14,438,216
2026		10,986,786
2027		8,221,001
Thereafter		30,671,270
Total minimum future rental income	$	94,078,216