In 2021, the Company entered into a noncancelable operating lease for approximately 100,000 square feet in Fremont, California used for laboratory operations and its corporate headquarters. The lease term is 13.5 years and commenced in October 2022. The Company gained early access to the premises for the purpose of constructing and installing tenant improvements, for which the landlord

contributed $15.1 million. Such contributions were accounted for as lease incentives and are recognized as reductions to lease expense over the lease term. The lease expires at the end of March 2036 and includes two options to extend the term for a period of five-years per option at market rates. The Company determined the extension options are not reasonably certain to be exercised. The lease includes escalating rent payments.

The Company has a noncancelable operating lease expiring in November 2027 for 31,280 square feet in Menlo Park, California previously used for laboratory operations and its former corporate headquarters. The lease includes escalating rent payments. In 2021, the Company expanded the leased premises by an additional 14,710 square feet of space (the “Expansion Lease”). The Expansion Lease expired at the end of December 2022 and was not extended. The Company moved all laboratory operations to the Fremont facility during the third quarter of 2023 and is actively marketing the vacated Menlo Park space for sublease.

The Company has noncancelable operating leases for data center space expiring between 2025 and 2026. The leases include renewal options that the Company determined are not reasonably certain to be exercised. During 2023, the data center operator agreed to terminate a portion of the lease at no cost. The Company remeasured the remaining lease liability and derecognized $0.6 million of operating lease liabilities and right-of-use assets.

The Company had an operating lease for laboratory space in Shanghai, China that was terminated early upon both parties' approval during 2023. The early termination did not result in any material penalties or charges in the Company's consolidated statements of operations. Separately, the Company also has various other short-term leases.

As of December 31, 2023, operating leases had a weighted-average remaining lease term of 10.4 years and a weighted-average discount rate of 10.5%. Discount rates are based on estimates of the Company's incremental borrowing rate, as the discount rates implicit in the leases cannot be readily determined. Future lease payments under operating leases as of December 31, 2023 were as follows (in thousands):


	Amount
2024	$	8,134
2025		8,057
2026		7,230
2027		7,189
2028		5,215
2029 and thereafter		42,798
Total future minimum lease payments		78,623
Less: imputed interest		(32,541	)
Present value of future minimum lease payments		46,082
Less: current portion of operating lease liability (included in accrued and other current liabilities)		(7,761	)
Long-term operating lease liabilities	$	38,321

Cash paid for operating lease liabilities, included in cash flows from operating activities in the consolidated statements of cash flows, for the years ended December 31, 2023, 2022, and 2021 was $6.0 million, $4.4 million, and $3.3 million, respectively. Right-of-use assets obtained in exchange for new operating lease liabilities during the years ended December 31, 2023, 2022, and 2021 were $1.3 million, $3.1 million, and $46.5 million, respectively.

Components of lease cost were as follows (in thousands):


	Year Ended December 31,
	2023		2022		2021
Lease cost
Operating lease cost	$	6,793	$	8,530	$	5,009
Short-term lease cost		198		122		364
Variable lease cost		1,828		1,411		1,152
Total lease cost	$	8,819	$	10,063	$	6,525

During the year ended December 31, 2023, the Company also recorded a $5.6 million impairment loss for operating lease right-of-use assets as a result of the change in use of the Menlo Park office.

During 2023, the Company completed the move of its laboratory operations from its Menlo Park facility to its Fremont facility and began actively marketing the Menlo Park space for sublease. Accordingly, the Company evaluated the ongoing value of the operating lease right-of-use asset associated with the Menlo Park facility. Based on this evaluation, the Company determined that the right-of-use asset with a carrying amount of $6.7 million was no longer recoverable and was impaired and wrote it down to its estimated fair value of $1.1 million, which resulted in a noncash impairment loss of $5.6 million. Estimated fair value was based on expected future sublease cash flows (with the assistance of a third-party real estate broker), net of brokerage commissions and estimated tenant incentives,

discounted at a market rate of return on similar assets. The estimation of fair value also included expected downtime prior to the commencement of a future sublease.