Leases

9 Months Ended

Oct. 30, 2022

Note 5: Leases

We currently lease most of the buildings or sites for our stores, store support center, and warehouse space under facility operating leases. These leases typically have initial terms ranging from ten to twenty years and include one or more options to renew. When determining the lease term, we include option periods for which renewal is reasonably certain. Most of the leases require us to pay property taxes, insurance, and maintenance of the leased assets. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Operating leases also include certain equipment leases that have a term in excess of one year. Certain facility leases also have provisions for additional contingent rentals based on revenues.

During fiscal

2020 and the first half of fiscal 2021, the Company entered into rent relief agreements with our respective landlords. The Company elected to apply an available practical expedient to account for lease concessions and deferrals resulting directly from the

COVID-19

pandemic as though the enforceable rights and obligations to the deferrals existed in the respective contracts at lease inception and not account for the concessions as lease modifications unless the concession results in a substantial increase in the Company’s obligations. The majority of rent relief agreements qualified for this accounting election, and the remaining agreements were treated as lease modifications, primarily due to a significant extension of the lease term. The Company has bifurcated our current operating lease liabilities into the portion that remains subject to accretion and the portion that is accounted for as a deferral of payments. The current portion of deferred occupancy costs is included in “Accrued liabilities” and the balance, or $3,994

and $8,434 as of October 30, 2022, and January 30, 2022, respectively, is included in “Other liabilities” in the Consolidated Balance Sheets.

Operating lease cost, variable lease cost and short-term lease cost related primarily to our facilities is included in “Other store operating expenses” for our operating stores,

“Pre-opening

costs” for our stores not yet operating, or “General and administrative expenses” for our corporate office and warehouse, in the Consolidated Statements of Comprehensive Income.

The components of lease expense, including variable lease costs primarily consisting of common area maintenance charges and property taxes, are as follows:


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	10/30/2022		10/31/2021		10/30/2022		10/31/2021
Operating lease cost	$	46,107	$	33,915	$	119,713	$	100,506
Variable lease cost		9,328		7,862		28,198		22,492
Short-term lease cost		460		121		772		431

Future minimum lease payments on operating lease liabilities were as follows as of October 30, 2022, by fiscal year:


Remainder of 2022	$	35,717
2023		191,775
2024		192,162
2025		193,349
2026		194,597
Thereafter		1,799,995

Total future operating lease liability	$	2,607,595
Less: interest		(952,729	)

Present value of operating lease liabilities	$	1,654,866

Operating lease payments in the table above includes minimum lease payments for future sites for which the leases have commenced. Operating lease payments exclude approximately $207,000 of minimum lease payments for twelve executed f

ility leases which have not yet commenced.