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Leases | 12 Months Ended
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Dec. 31, 2022
Leases [Abstract] |
Leases | 15. Leases The Company leases office space and equipment under various operating lease arrangements. The Company’s leases have remaining lease terms ranging from 8 months to 7 years. Some building leases have options to extend, terminate, or retract the leased area. During the year ended December 31, 2021, the Company exercised the contraction clause of one of its leases. The Company incurred a $0.3 million contraction fee in conjunction with exercising the contraction clause. The related lease ROU asset and lease liability were revalued when the Company exercised the contraction clause. In conjunction with the sale of the renewal rights related to the Company's Farm, Ranch & Stable business, lease ROU assets related to building space, parking, and equipment at the Company’s Omaha Nebraska location were evaluated for impairment. An impairment loss of $0.5 million was recognized and included in acquisition costs and other underwriting expenses on the Company’s consolidated statements of operations for the year ended December 31, 2022. The lease ROU assets and lease liabilities related to the Omaha Nebraska building and parking lease were also re-measured due to the Company’s intention to exercise the early termination clause which allows the Company to reduce the length of the lease term from 125 months to 65 months. In conjunction with the sale of the renewal rights related to the Company's manufactured and dwelling homes business, lease ROU assets related to building space, parking, and equipment at the Company’s Scottsdale Arizona location were evaluated for impairment. An impairment loss of $0.7 million was recognized in acquisition costs and other underwriting expenses on the Company’s consolidated statements of operations for the year ended December 31, 2022. An impairment loss of $1.5 million was recognized and included in corporate and other operating expenses on the Company’s consolidated statements of operations for the year ended December 31, 2021. The lease ROU assets and lease liabilities related to the Scottsdale Arizona building and parking lease were also re-measured due to the Company’s intention to exercise the early termination clause which allows the Company to reduce the length of the lease term from 131 months to 95 months. As part of this sale, K2 is subleasing approximately one third of the Company’s Scottsdale, Arizona office. If the Company exercises the early termination clause, it will receive $1.6 million in sublease payments from K2. If it does not exercise the early termination clause, it will receive $2.4 million in sublease payments from K2 between October 2021 and November 2029. Rental income derived from this sublease will be recognized on a straight-line basis over the operating lease term. Please see Note 3 for additional information on the sale of renewal rights. Since employees in Ireland work remotely, the company decided to terminate its lease in Cavan Ireland. As a result, an impairment loss of $0.2 million was recognized and included in acquisition costs and other underwriting expenses on the Company’s consolidated statements of operations for the year ended December 31, 2022. The impairments losses recognized on leases were as follows:
|  | Years Ended December 31, |
(Dollars in thousands) |  | 2022 |  |  | 2021 |  |  | 2020 |
Scottsdale Arizona |  | $ | 681 |  |  | $ | 1,515 |  |  | $ | — |
Omaha Nebraska |  |  | 488 |  |  |  | — |  |  |  | — |
Cavan Ireland |  |  | 168 |  |  |  | — |  |  |  | — |
Total lease impairment |  | $ | 1,337 |  |  | $ | 1,515 |  |  | $ | — |
The components of lease expenses were as follows:
|  | Years Ended December 31, |
(Dollars in thousands) |  | 2022 |  |  | 2021 |  |  | 2020 |
Operating lease expenses |  | $ | 2,372 |  |  | $ | 2,789 |  |  | $ | 2,952 |
Short-term lease expenses |  |  | 15 |  |  |  | 8 |  |  |  | 7 |
Sublease income |  |  | (331 | ) |  |  | (55 | ) |  |  | — |
Total lease expenses |  | $ | 2,056 |  |  | $ | 2,742 |  |  | $ | 2,959 |
Supplemental cash flow information related to leases was as follows:
|  | Years Ended December 31, |
(Dollars in thousands) |  | 2022 |  |  | 2021 |  |  | 2020 |
Cash paid for amounts included in the measurement of liabilities: |  |  |  |  |  |  |  |  |
Operating leases |  | $ | 2,056 |  |  | $ | 2,797 |  |  | $ | 2,012 |
Right-of-use assets obtained in exchange for new lease obligations: |  |  |  |  |  |  |  |  |
Operating leases |  | $ | — |  |  | $ | 783 |  |  | $ | 772 |
Supplemental balance sheet information related to leases was as follows: The table below presents the lease-related assets and liabilities recorded on the consolidated balance sheets.
|  |  |  | December 31, |
(Dollars in thousands) |  | Classification on the consolidated balance sheets |  | 2022 |  |  | 2021 |
Assets: |  |  |  |  |  |  |  |
Operating lease assets |  | Lease right of use assets |  | $ | 11,739 |  |  | $ | 16,051 |
Liabilities: |  |  |  |  |  |  |  |
Operating lease liabilities |  | Lease liabilities |  | $ | 15,701 |  |  | $ | 19,079 |
Weighted-average remaining lease term |  |  |  |  |  |  |  |
Operating leases |  |  |  | 6.6 years |  |  | 7.7 years |
Weighted-average discount rate |  |  |  |  |  |  |  |
Operating leases (1) |  |  |  |  | 0.9 | % |  |  | 0.9 | %
(1) Represents the Company’s incremental borrowing rate at the time the leases were contracted. At December 31, 2022, future minimum lease payments under non-cancelable operating leases were as follows.
(Dollars in thousands) |  | Operating Leases (1) |  |  | Expected Sublease Income |
2023 |  | $ | 2,995 |  |  | $ | 291 |
2024 |  |  | 2,799 |  |  |  | 297 |
2025 |  |  | 2,831 |  |  |  | 388 |
2026 |  |  | 2,650 |  |  |  | 342 |
2027 |  |  | 1,590 |  |  |  | — |
Thereafter |  |  | 3,241 |  |  |  | — |
Total future minimum lease payments |  |  | 16,106 |  |  |  | 1,318 |
Less: amount representing interest |  |  | 405 |  |  |  | — |
Present value of minimum lease payments |  | $ | 15,701 |  |  | $ | 1,318 |
(1) Includes future minimum lease payments of $4.6 million on leases that have been impaired because the property is no longer in use.

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- Definition The entire disclosure for operating leases of lessee. Includes, but is not limited to, description of operating lease and maturity analysis of operating lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 20 -URI https://asc.fasb.org/subtopic&trid=77888251 + Details
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