Leases - The Company as Lessor

12 Months Ended

Dec. 31, 2023

Leases - The Company as a Lessor

The Company leases real estate property to tenants under operating leases. Such activity is primarily composed of operating leases within its CRE segment.

As a result of the coronavirus pandemic ("COVID-19"), the Company provided certain of its tenants rent relief arrangements during the years ended December 31, 2022 and 2021, which typically consisted of rent deferrals or other relief modifications that resulted in changes to fixed contractual lease payments for specified months. Consistent with lease accounting guidance and interpretations provided by the FASB for rent relief arrangements specifically related to COVID-19, the Company elected to treat such eligible lease concessions (i.e., such rent deferrals, fixed-to-variable modifications or payment forgiveness arrangements that do not result in a substantial increase in the rights of the lessor or obligations of the lessee) outside of the lease accounting modification framework.

For such eligible rent deferrals, the Company accounts for the event as if no changes to the lease contract were made and continues to record lease receivables and recognize income during the deferral period. For the eligible other relief modifications mentioned above that resulted in reductions to fixed contractual lease payments the Company reports, for periods covered by the modification, reduced rental income (i.e., revenue) equal to the agreed-upon amounts (offset by any variable lease

payments). The Company assesses collectability on all such amounts due under leases and only recognizes revenue to the extent such amounts are probable of collection (or payment is received).

The historical cost of, and accumulated depreciation on, leased property as of December 31, 2023 and 2022, was as follows (in millions):


	2023		2022
Leased property - real estate	$	1,607.9	$	1,572.0
Less: accumulated depreciation	(228.7)		(201.8)
Property under operating leases - net1	$	1,379.2	$	1,370.2
1Property under operating leases as of December 31, 2023 includes leased property included in assets held for sale.

Total rental income (i.e., revenue) under these operating leases relating to lease payments and variable lease payments were as follows (in millions):


	2023		2022		2021
Lease payments	$	134.3	$	130.8	$	121.3
Variable lease payments	60.9		58.5		54.1
Revenues deemed uncollectible, net	(0.5)		0.8		3.1
Total rental income	$	194.7	$	190.1	$	178.5

Contractual future lease payments to be received on non-cancelable operating leases as of December 31, 2023, were as follows (in millions):


2024	$	129.2
2025	115.1
2026	101.2
2027	89.0
2028	74.6
Thereafter	557.2
Total future lease payments to be received	$	1,066.3