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Leases | 12 Months Ended
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Sep. 27, 2020
Leases [Abstract] |
Operating Leases, Lessee | LEASES Nature of leases — We own restaurant sites and we also lease restaurant sites from third parties. Some of these owned or leased sites are leased and/or subleased to franchisees. Initial terms of our real estate leases are generally 20 years, exclusive of options to renew, which are generally exercisable at our sole discretion for 1 to 20 years. In some instances, our leases have provisions for contingent rentals based upon a percentage of defined revenues. Many of our restaurants also have rent escalation clauses and require the payment of property taxes, insurance, and maintenance costs. Variable lease costs include contingent rent, cost-of-living index adjustments, and payments for additional rent such as real estate taxes, insurance and common area maintenance, which are excluded from the measurement of the lease liability. We also lease certain restaurant and office equipment with initial terms generally ranging from 3 to 8 years. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. As lessor, our leases and subleases primarily consist of restaurants that have been leased to franchisees subsequent to refranchising transactions. The lease descriptions, terms, variable lease payments and renewal options are generally the same as the lessee leases described above. Revenues from leasing arrangements with our franchisees are presented in “Franchise rental revenues” in the accompanying consolidated statements of earnings, and the related expenses are presented in “Franchise occupancy expenses.” Rent concessions as lessee — In response to the pandemic, certain landlords have agreed to temporary rent concessions. These concessions generally relate to the deferral of certain rent payments for April, May, June, and July 2020 until future periods and total approximately $15.5 million. We considered the FASB’s recent guidance regarding rent concessions related to the effects of the COVID-19 pandemic and have elected to apply the temporary practical expedient to account for rent concessions as though enforceable rights and obligations for those concessions existed in the lease agreements. Therefore, we did not remeasure our lease ROU assets and liabilities, and we have not bifurcated our operating lease liabilities into the portion that remains subject to accretion of $947.8 million, and the portion that is related to the rent deferrals of $7.2 million as of September 27, 2020. Rent concessions as lessor — We postponed collection of approximately 40% of April 2020 rents due from our franchisees totaling approximately $9.1 million, to be collected over three months beginning July 2020. Furthermore, we passed on to our franchisees approximately $5.6 million of the rent concessions secured from our landlords for April, May, June, and July 2020. As of September 27, 2020, all of the postponed April rent has been repaid and the franchisees have chosen to pay according to the original lease terms on approximately half of the rent concessions that we offered. As of September 27, 2020, rent concessions which remain uncollected were $2.6 million and are included within “Accounts and other receivable, net” in our consolidated balance sheets. Company as lessee — Leased assets and liabilities consisted of the following as of September 27, 2020 (in thousands):
| September 27, 2020
Assets: |
Operating lease ROU assets | $ | 904,548 |
Finance lease ROU assets (1) | 2,333 |
Total ROU assets | $ | 906,881 |
Liabilities: |
Current operating lease liabilities | $ | 179,000 |
Current finance lease liabilities (2) | 818 |
Long term operating lease liabilities | 776,094 |
Long-term finance lease liabilities (2) | 2,116 |
Total lease liabilities | $ | 958,028 |
________________________ (1)Included in “Property and equipment, net” on our consolidated balance sheet. (2)Included in “Current maturities of long-term debt” and “Long-term debt, net of current maturities” on our consolidated balance sheet. The following table presents the components of our lease costs in fiscal 2020 (in thousands):
| 2020
Lease costs: |
Finance lease cost: |
Amortization of ROU assets (1) | $ | 767 |
Interest on lease liabilities (2) | 110 |
Operating lease cost (3) | 190,461 |
Short-term lease cost (3) | 175 |
Variable lease cost (3)(4) | 40,798 |
| $ | 232,311 |
________________________ (1)Included in “Depreciation and amortization” in our consolidated statement of earnings. (2)Included in “Interest expense, net” in our consolidated statement of earnings. (3)Operating lease, short-term and variable lease costs associated with franchisees and company-operated restaurants are included in “Franchise occupancy expenses” and “Occupancy and other,” respectively, in our consolidated statement of earnings. For our closed restaurants, these costs are included in “Impairment and other, net” and all other costs are included in “Selling, general and administrative expenses.” (4)Includes $37.4 million of property taxes and common area maintenance costs which are reimbursed by sub-lessees. The following table summarizes the components of rent expense in fiscal 2019 and 2018, as accounted for under previous guidance (in thousands):
| 2019 |  | 2018
Minimum rentals | 184,587 |  |  | 184,106 |
Contingent rentals | 2,255 |  |  | 2,221 |
Total rent expense | 186,842 |  |  | 186,327 |
The following table presents supplemental information related to leases:
| September 27, 2020
Weighted-average remaining lease term (in years): |
Finance leases | 3.3
Operating leases | 8.3
Weighted-average discount rate: |
Finance leases | 3.5 | %
Operating leases | 4.2 | %
The following table presents as of September 27, 2020, the annual maturities of our lease liabilities (in thousands):
| Finance Leases |  | Operating Leases
Fiscal year: |  |  |
2021 (1) | $ | 917 |  |  | $ | 215,039 |
2022 | 906 |  |  | 167,926 |
2023 | 904 |  |  | 140,576 |
2024 | 400 |  |  | 108,576 |
2025 | 24 |  |  | 99,334 |
Thereafter | 20 |  |  | 417,850 |
Total future lease payments (2) | $ | 3,171 |  |  | $ | 1,149,301 |
Less: imputed interest | (237) |  |  | (194,207) |
Present value of lease liabilities | $ | 2,934 |  |  | $ | 955,094 |
Less current portion | (818) |  |  | (179,000) |
Long-term lease obligations | $ | 2,116 |  |  | $ | 776,094 |
________________________ (1)The impact of rent concessions increased 2021 operating leases maturities by $7.2 million. (2)Total future lease payments include non-cancellable commitments of $3.2 million for finance leases and $1,076.9 million for operating leases. The following table presents as of September 29, 2019, future minimum lease payments for non-cancellable leases (in thousands):
| Capital Leases |  | Operating Leases
Fiscal year: |  |  |
2020 | $ | 879 |  |  | $ | 193,313 |
2021 | 879 |  |  | 186,226 |
2022 | 879 |  |  | 145,794 |
2023 | 864 |  |  | 117,753 |
2024 | 396 |  |  | 87,420 |
Thereafter | 40 |  |  | 363,505 |
Total minimum lease payments | $ | 3,937 |  |  | $ | 1,094,011 |
Less: imputed interest | (343) |  |  |
Present value of lease liability | $ | 3,594 |  |  |
Less current portion | (774) |  |  |
Long-term lease obligations | $ | 2,820 |  |  |
Assets recorded under finance leases are included in property and equipment, and consisted of the following at each fiscal year-end (in thousands):
| 2020 |  | 2019
Buildings | 1,342 |  |  | 1,342 |
Equipment | 5,631 |  |  | 5,538 |
Less accumulated amortization | (4,640) |  |  | (3,904) |
| 2,333 |  |  | 2,976 |
The following table includes supplemental cash flow and non-cash information related to our lessee leases (in thousands):
| 2020 |
Cash paid for amounts included in the measurement of lease liabilities: |  |
Operating cash flows from operating leases | $ | 190,303 |  |
Operating cash flows from financing leases | $ | 110 |  |
Financing cash flows from financing leases | $ | 785 |  |
Right-of-use assets obtained in exchange for lease obligations: |  |
Operating leases | $ | 181,532 |  |
Financing leases | $ | 132 |  |
Sale leaseback transactions — In fiscal 2020, we completed two sale-leaseback transactions of our restaurant properties with one occurring during the first quarter of 2020 and the other occurring during the third quarter of 2020. In the first quarter of 2020, we completed a sale leaseback transaction of a multi-tenant commercial property in Los Angeles, California and leased back the parcel on which a company-operated restaurant is located. The Company received net proceeds of $17.4 million and recognized a $0.2 million loss on the sale. The initial term on the lease is 20 years and the lease has been accounted for as an operating lease. Under the other arrangement, we received net proceeds of $2.4 million on a restaurant property sold and recognized a loss of less than $0.1 million on the sale. The initial term of the lease is 17 years and the lease has been accounted for as an operating lease. In fiscal 2020, we also completed the sale of one of our corporate office buildings as we move forward with our previously announced consolidation of our headquarters. We entered into a lease with the buyer to leaseback the property for up to 18 months with an option to terminate earlier without penalty, upon providing a 90-day notice. The net proceeds received on the sale were $20.6 million and the lease has been accounted for as an operating lease. A gain on the sale of $10.8 million was recognized, and is presented within “Impairment and other charges, net” in our consolidated statement of earnings. Company as lessor — The following table presents rental income (in thousands):
| 2020
| Owned Properties |  | Leased Properties |  | Total
Operating lease income - franchise | $ | 19,785 |  |  | $ | 216,015 |  |  | $ | 235,800 |
Variable lease income - franchise | 9,960 |  |  | 74,887 |  |  | 84,847 |
Franchise rental revenues | $ | 29,745 |  |  | $ | 290,902 |  |  | $ | 320,647 |
Operating lease income - closed restaurants and other (1) | $ | — |  |  | $ | 6,370 |  |  | $ | 6,370 |
________________________ (1)Primarily relates to closed restaurant properties included in “Impairment and other, net” in our consolidated statement of earnings. The following table summarizes rents received in fiscal 2019 and 2018, as accounted for under previous guidance (in thousands):
| 2019 |  | 2018
Total rental income (1) | $ | 277,623 |  |  | $ | 264,432 |
Contingent rentals | $ | 38,506 |  |  | $ | 35,148 |
________________________ (1)Includes contingent rentals. The following table presents as of September 27, 2020, future minimum rental receipts for non-cancellable leases and subleases (in thousands):
| September 27, 2020
Fiscal year: |
2021 (1) | $ | 261,388 |
2022 | 234,545 |
2023 | 227,976 |
2024 | 202,636 |
2025 | 211,320 |
Thereafter | 1,067,624 |
Total minimum rental receipts | $ | 2,205,489 |
________________________ (1)The impact of rent concessions passed on to franchisees increased 2021 by $2.6 million. The following table presents as of September 29, 2019, future minimum rental receipts for non-cancellable leases and subleases (in thousands):
| September 29, 2019
Fiscal year: |
2020 | $ | 239,219 |
2021 | 255,315 |
2022 | 231,394 |
2023 | 224,605 |
2024 | 199,442 |
Thereafter | 1,215,811 |
Total minimum rental receipts | $ | 2,365,786 |
Assets held for lease and included in property and equipment consisted of the following at each fiscal year-end (in thousands):
|  | September 27, 2020 |  | September 29, 2019
Land |  | $ | 88,187 |  |  | $ | 91,130 |
Buildings |  | 801,730 |  |  | 817,400 |
Equipment |  | 589 |  |  | 537 |
|  | 890,506 |  |  | 909,067 |
Less accumulated depreciation |  | (650,812) |  |  | (632,197) |
|  | $ | 239,694 |  |  | $ | 276,870 |
Finance Leases, Lessee | LEASES Nature of leases — We own restaurant sites and we also lease restaurant sites from third parties. Some of these owned or leased sites are leased and/or subleased to franchisees. Initial terms of our real estate leases are generally 20 years, exclusive of options to renew, which are generally exercisable at our sole discretion for 1 to 20 years. In some instances, our leases have provisions for contingent rentals based upon a percentage of defined revenues. Many of our restaurants also have rent escalation clauses and require the payment of property taxes, insurance, and maintenance costs. Variable lease costs include contingent rent, cost-of-living index adjustments, and payments for additional rent such as real estate taxes, insurance and common area maintenance, which are excluded from the measurement of the lease liability. We also lease certain restaurant and office equipment with initial terms generally ranging from 3 to 8 years. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. As lessor, our leases and subleases primarily consist of restaurants that have been leased to franchisees subsequent to refranchising transactions. The lease descriptions, terms, variable lease payments and renewal options are generally the same as the lessee leases described above. Revenues from leasing arrangements with our franchisees are presented in “Franchise rental revenues” in the accompanying consolidated statements of earnings, and the related expenses are presented in “Franchise occupancy expenses.” Rent concessions as lessee — In response to the pandemic, certain landlords have agreed to temporary rent concessions. These concessions generally relate to the deferral of certain rent payments for April, May, June, and July 2020 until future periods and total approximately $15.5 million. We considered the FASB’s recent guidance regarding rent concessions related to the effects of the COVID-19 pandemic and have elected to apply the temporary practical expedient to account for rent concessions as though enforceable rights and obligations for those concessions existed in the lease agreements. Therefore, we did not remeasure our lease ROU assets and liabilities, and we have not bifurcated our operating lease liabilities into the portion that remains subject to accretion of $947.8 million, and the portion that is related to the rent deferrals of $7.2 million as of September 27, 2020. Rent concessions as lessor — We postponed collection of approximately 40% of April 2020 rents due from our franchisees totaling approximately $9.1 million, to be collected over three months beginning July 2020. Furthermore, we passed on to our franchisees approximately $5.6 million of the rent concessions secured from our landlords for April, May, June, and July 2020. As of September 27, 2020, all of the postponed April rent has been repaid and the franchisees have chosen to pay according to the original lease terms on approximately half of the rent concessions that we offered. As of September 27, 2020, rent concessions which remain uncollected were $2.6 million and are included within “Accounts and other receivable, net” in our consolidated balance sheets. Company as lessee — Leased assets and liabilities consisted of the following as of September 27, 2020 (in thousands):
| September 27, 2020
Assets: |
Operating lease ROU assets | $ | 904,548 |
Finance lease ROU assets (1) | 2,333 |
Total ROU assets | $ | 906,881 |
Liabilities: |
Current operating lease liabilities | $ | 179,000 |
Current finance lease liabilities (2) | 818 |
Long term operating lease liabilities | 776,094 |
Long-term finance lease liabilities (2) | 2,116 |
Total lease liabilities | $ | 958,028 |
________________________ (1)Included in “Property and equipment, net” on our consolidated balance sheet. (2)Included in “Current maturities of long-term debt” and “Long-term debt, net of current maturities” on our consolidated balance sheet. The following table presents the components of our lease costs in fiscal 2020 (in thousands):
| 2020
Lease costs: |
Finance lease cost: |
Amortization of ROU assets (1) | $ | 767 |
Interest on lease liabilities (2) | 110 |
Operating lease cost (3) | 190,461 |
Short-term lease cost (3) | 175 |
Variable lease cost (3)(4) | 40,798 |
| $ | 232,311 |
________________________ (1)Included in “Depreciation and amortization” in our consolidated statement of earnings. (2)Included in “Interest expense, net” in our consolidated statement of earnings. (3)Operating lease, short-term and variable lease costs associated with franchisees and company-operated restaurants are included in “Franchise occupancy expenses” and “Occupancy and other,” respectively, in our consolidated statement of earnings. For our closed restaurants, these costs are included in “Impairment and other, net” and all other costs are included in “Selling, general and administrative expenses.” (4)Includes $37.4 million of property taxes and common area maintenance costs which are reimbursed by sub-lessees. The following table summarizes the components of rent expense in fiscal 2019 and 2018, as accounted for under previous guidance (in thousands):
| 2019 |  | 2018
Minimum rentals | 184,587 |  |  | 184,106 |
Contingent rentals | 2,255 |  |  | 2,221 |
Total rent expense | 186,842 |  |  | 186,327 |
The following table presents supplemental information related to leases:
| September 27, 2020
Weighted-average remaining lease term (in years): |
Finance leases | 3.3
Operating leases | 8.3
Weighted-average discount rate: |
Finance leases | 3.5 | %
Operating leases | 4.2 | %
The following table presents as of September 27, 2020, the annual maturities of our lease liabilities (in thousands):
| Finance Leases |  | Operating Leases
Fiscal year: |  |  |
2021 (1) | $ | 917 |  |  | $ | 215,039 |
2022 | 906 |  |  | 167,926 |
2023 | 904 |  |  | 140,576 |
2024 | 400 |  |  | 108,576 |
2025 | 24 |  |  | 99,334 |
Thereafter | 20 |  |  | 417,850 |
Total future lease payments (2) | $ | 3,171 |  |  | $ | 1,149,301 |
Less: imputed interest | (237) |  |  | (194,207) |
Present value of lease liabilities | $ | 2,934 |  |  | $ | 955,094 |
Less current portion | (818) |  |  | (179,000) |
Long-term lease obligations | $ | 2,116 |  |  | $ | 776,094 |
________________________ (1)The impact of rent concessions increased 2021 operating leases maturities by $7.2 million. (2)Total future lease payments include non-cancellable commitments of $3.2 million for finance leases and $1,076.9 million for operating leases. The following table presents as of September 29, 2019, future minimum lease payments for non-cancellable leases (in thousands):
| Capital Leases |  | Operating Leases
Fiscal year: |  |  |
2020 | $ | 879 |  |  | $ | 193,313 |
2021 | 879 |  |  | 186,226 |
2022 | 879 |  |  | 145,794 |
2023 | 864 |  |  | 117,753 |
2024 | 396 |  |  | 87,420 |
Thereafter | 40 |  |  | 363,505 |
Total minimum lease payments | $ | 3,937 |  |  | $ | 1,094,011 |
Less: imputed interest | (343) |  |  |
Present value of lease liability | $ | 3,594 |  |  |
Less current portion | (774) |  |  |
Long-term lease obligations | $ | 2,820 |  |  |
Assets recorded under finance leases are included in property and equipment, and consisted of the following at each fiscal year-end (in thousands):
| 2020 |  | 2019
Buildings | 1,342 |  |  | 1,342 |
Equipment | 5,631 |  |  | 5,538 |
Less accumulated amortization | (4,640) |  |  | (3,904) |
| 2,333 |  |  | 2,976 |
The following table includes supplemental cash flow and non-cash information related to our lessee leases (in thousands):
| 2020 |
Cash paid for amounts included in the measurement of lease liabilities: |  |
Operating cash flows from operating leases | $ | 190,303 |  |
Operating cash flows from financing leases | $ | 110 |  |
Financing cash flows from financing leases | $ | 785 |  |
Right-of-use assets obtained in exchange for lease obligations: |  |
Operating leases | $ | 181,532 |  |
Financing leases | $ | 132 |  |
Sale leaseback transactions — In fiscal 2020, we completed two sale-leaseback transactions of our restaurant properties with one occurring during the first quarter of 2020 and the other occurring during the third quarter of 2020. In the first quarter of 2020, we completed a sale leaseback transaction of a multi-tenant commercial property in Los Angeles, California and leased back the parcel on which a company-operated restaurant is located. The Company received net proceeds of $17.4 million and recognized a $0.2 million loss on the sale. The initial term on the lease is 20 years and the lease has been accounted for as an operating lease. Under the other arrangement, we received net proceeds of $2.4 million on a restaurant property sold and recognized a loss of less than $0.1 million on the sale. The initial term of the lease is 17 years and the lease has been accounted for as an operating lease. In fiscal 2020, we also completed the sale of one of our corporate office buildings as we move forward with our previously announced consolidation of our headquarters. We entered into a lease with the buyer to leaseback the property for up to 18 months with an option to terminate earlier without penalty, upon providing a 90-day notice. The net proceeds received on the sale were $20.6 million and the lease has been accounted for as an operating lease. A gain on the sale of $10.8 million was recognized, and is presented within “Impairment and other charges, net” in our consolidated statement of earnings. Company as lessor — The following table presents rental income (in thousands):
| 2020
| Owned Properties |  | Leased Properties |  | Total
Operating lease income - franchise | $ | 19,785 |  |  | $ | 216,015 |  |  | $ | 235,800 |
Variable lease income - franchise | 9,960 |  |  | 74,887 |  |  | 84,847 |
Franchise rental revenues | $ | 29,745 |  |  | $ | 290,902 |  |  | $ | 320,647 |
Operating lease income - closed restaurants and other (1) | $ | — |  |  | $ | 6,370 |  |  | $ | 6,370 |
________________________ (1)Primarily relates to closed restaurant properties included in “Impairment and other, net” in our consolidated statement of earnings. The following table summarizes rents received in fiscal 2019 and 2018, as accounted for under previous guidance (in thousands):
| 2019 |  | 2018
Total rental income (1) | $ | 277,623 |  |  | $ | 264,432 |
Contingent rentals | $ | 38,506 |  |  | $ | 35,148 |
________________________ (1)Includes contingent rentals. The following table presents as of September 27, 2020, future minimum rental receipts for non-cancellable leases and subleases (in thousands):
| September 27, 2020
Fiscal year: |
2021 (1) | $ | 261,388 |
2022 | 234,545 |
2023 | 227,976 |
2024 | 202,636 |
2025 | 211,320 |
Thereafter | 1,067,624 |
Total minimum rental receipts | $ | 2,205,489 |
________________________ (1)The impact of rent concessions passed on to franchisees increased 2021 by $2.6 million. The following table presents as of September 29, 2019, future minimum rental receipts for non-cancellable leases and subleases (in thousands):
| September 29, 2019
Fiscal year: |
2020 | $ | 239,219 |
2021 | 255,315 |
2022 | 231,394 |
2023 | 224,605 |
2024 | 199,442 |
Thereafter | 1,215,811 |
Total minimum rental receipts | $ | 2,365,786 |
Assets held for lease and included in property and equipment consisted of the following at each fiscal year-end (in thousands):
|  | September 27, 2020 |  | September 29, 2019
Land |  | $ | 88,187 |  |  | $ | 91,130 |
Buildings |  | 801,730 |  |  | 817,400 |
Equipment |  | 589 |  |  | 537 |
|  | 890,506 |  |  | 909,067 |
Less accumulated depreciation |  | (650,812) |  |  | (632,197) |
|  | $ | 239,694 |  |  | $ | 276,870 |
Operating Leases, Lessor | LEASES Nature of leases — We own restaurant sites and we also lease restaurant sites from third parties. Some of these owned or leased sites are leased and/or subleased to franchisees. Initial terms of our real estate leases are generally 20 years, exclusive of options to renew, which are generally exercisable at our sole discretion for 1 to 20 years. In some instances, our leases have provisions for contingent rentals based upon a percentage of defined revenues. Many of our restaurants also have rent escalation clauses and require the payment of property taxes, insurance, and maintenance costs. Variable lease costs include contingent rent, cost-of-living index adjustments, and payments for additional rent such as real estate taxes, insurance and common area maintenance, which are excluded from the measurement of the lease liability. We also lease certain restaurant and office equipment with initial terms generally ranging from 3 to 8 years. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. As lessor, our leases and subleases primarily consist of restaurants that have been leased to franchisees subsequent to refranchising transactions. The lease descriptions, terms, variable lease payments and renewal options are generally the same as the lessee leases described above. Revenues from leasing arrangements with our franchisees are presented in “Franchise rental revenues” in the accompanying consolidated statements of earnings, and the related expenses are presented in “Franchise occupancy expenses.” Rent concessions as lessee — In response to the pandemic, certain landlords have agreed to temporary rent concessions. These concessions generally relate to the deferral of certain rent payments for April, May, June, and July 2020 until future periods and total approximately $15.5 million. We considered the FASB’s recent guidance regarding rent concessions related to the effects of the COVID-19 pandemic and have elected to apply the temporary practical expedient to account for rent concessions as though enforceable rights and obligations for those concessions existed in the lease agreements. Therefore, we did not remeasure our lease ROU assets and liabilities, and we have not bifurcated our operating lease liabilities into the portion that remains subject to accretion of $947.8 million, and the portion that is related to the rent deferrals of $7.2 million as of September 27, 2020. Rent concessions as lessor — We postponed collection of approximately 40% of April 2020 rents due from our franchisees totaling approximately $9.1 million, to be collected over three months beginning July 2020. Furthermore, we passed on to our franchisees approximately $5.6 million of the rent concessions secured from our landlords for April, May, June, and July 2020. As of September 27, 2020, all of the postponed April rent has been repaid and the franchisees have chosen to pay according to the original lease terms on approximately half of the rent concessions that we offered. As of September 27, 2020, rent concessions which remain uncollected were $2.6 million and are included within “Accounts and other receivable, net” in our consolidated balance sheets. Company as lessee — Leased assets and liabilities consisted of the following as of September 27, 2020 (in thousands):
| September 27, 2020
Assets: |
Operating lease ROU assets | $ | 904,548 |
Finance lease ROU assets (1) | 2,333 |
Total ROU assets | $ | 906,881 |
Liabilities: |
Current operating lease liabilities | $ | 179,000 |
Current finance lease liabilities (2) | 818 |
Long term operating lease liabilities | 776,094 |
Long-term finance lease liabilities (2) | 2,116 |
Total lease liabilities | $ | 958,028 |
________________________ (1)Included in “Property and equipment, net” on our consolidated balance sheet. (2)Included in “Current maturities of long-term debt” and “Long-term debt, net of current maturities” on our consolidated balance sheet. The following table presents the components of our lease costs in fiscal 2020 (in thousands):
| 2020
Lease costs: |
Finance lease cost: |
Amortization of ROU assets (1) | $ | 767 |
Interest on lease liabilities (2) | 110 |
Operating lease cost (3) | 190,461 |
Short-term lease cost (3) | 175 |
Variable lease cost (3)(4) | 40,798 |
| $ | 232,311 |
________________________ (1)Included in “Depreciation and amortization” in our consolidated statement of earnings. (2)Included in “Interest expense, net” in our consolidated statement of earnings. (3)Operating lease, short-term and variable lease costs associated with franchisees and company-operated restaurants are included in “Franchise occupancy expenses” and “Occupancy and other,” respectively, in our consolidated statement of earnings. For our closed restaurants, these costs are included in “Impairment and other, net” and all other costs are included in “Selling, general and administrative expenses.” (4)Includes $37.4 million of property taxes and common area maintenance costs which are reimbursed by sub-lessees. The following table summarizes the components of rent expense in fiscal 2019 and 2018, as accounted for under previous guidance (in thousands):
| 2019 |  | 2018
Minimum rentals | 184,587 |  |  | 184,106 |
Contingent rentals | 2,255 |  |  | 2,221 |
Total rent expense | 186,842 |  |  | 186,327 |
The following table presents supplemental information related to leases:
| September 27, 2020
Weighted-average remaining lease term (in years): |
Finance leases | 3.3
Operating leases | 8.3
Weighted-average discount rate: |
Finance leases | 3.5 | %
Operating leases | 4.2 | %
The following table presents as of September 27, 2020, the annual maturities of our lease liabilities (in thousands):
| Finance Leases |  | Operating Leases
Fiscal year: |  |  |
2021 (1) | $ | 917 |  |  | $ | 215,039 |
2022 | 906 |  |  | 167,926 |
2023 | 904 |  |  | 140,576 |
2024 | 400 |  |  | 108,576 |
2025 | 24 |  |  | 99,334 |
Thereafter | 20 |  |  | 417,850 |
Total future lease payments (2) | $ | 3,171 |  |  | $ | 1,149,301 |
Less: imputed interest | (237) |  |  | (194,207) |
Present value of lease liabilities | $ | 2,934 |  |  | $ | 955,094 |
Less current portion | (818) |  |  | (179,000) |
Long-term lease obligations | $ | 2,116 |  |  | $ | 776,094 |
________________________ (1)The impact of rent concessions increased 2021 operating leases maturities by $7.2 million. (2)Total future lease payments include non-cancellable commitments of $3.2 million for finance leases and $1,076.9 million for operating leases. The following table presents as of September 29, 2019, future minimum lease payments for non-cancellable leases (in thousands):
| Capital Leases |  | Operating Leases
Fiscal year: |  |  |
2020 | $ | 879 |  |  | $ | 193,313 |
2021 | 879 |  |  | 186,226 |
2022 | 879 |  |  | 145,794 |
2023 | 864 |  |  | 117,753 |
2024 | 396 |  |  | 87,420 |
Thereafter | 40 |  |  | 363,505 |
Total minimum lease payments | $ | 3,937 |  |  | $ | 1,094,011 |
Less: imputed interest | (343) |  |  |
Present value of lease liability | $ | 3,594 |  |  |
Less current portion | (774) |  |  |
Long-term lease obligations | $ | 2,820 |  |  |
Assets recorded under finance leases are included in property and equipment, and consisted of the following at each fiscal year-end (in thousands):
| 2020 |  | 2019
Buildings | 1,342 |  |  | 1,342 |
Equipment | 5,631 |  |  | 5,538 |
Less accumulated amortization | (4,640) |  |  | (3,904) |
| 2,333 |  |  | 2,976 |
The following table includes supplemental cash flow and non-cash information related to our lessee leases (in thousands):
| 2020 |
Cash paid for amounts included in the measurement of lease liabilities: |  |
Operating cash flows from operating leases | $ | 190,303 |  |
Operating cash flows from financing leases | $ | 110 |  |
Financing cash flows from financing leases | $ | 785 |  |
Right-of-use assets obtained in exchange for lease obligations: |  |
Operating leases | $ | 181,532 |  |
Financing leases | $ | 132 |  |
Sale leaseback transactions — In fiscal 2020, we completed two sale-leaseback transactions of our restaurant properties with one occurring during the first quarter of 2020 and the other occurring during the third quarter of 2020. In the first quarter of 2020, we completed a sale leaseback transaction of a multi-tenant commercial property in Los Angeles, California and leased back the parcel on which a company-operated restaurant is located. The Company received net proceeds of $17.4 million and recognized a $0.2 million loss on the sale. The initial term on the lease is 20 years and the lease has been accounted for as an operating lease. Under the other arrangement, we received net proceeds of $2.4 million on a restaurant property sold and recognized a loss of less than $0.1 million on the sale. The initial term of the lease is 17 years and the lease has been accounted for as an operating lease. In fiscal 2020, we also completed the sale of one of our corporate office buildings as we move forward with our previously announced consolidation of our headquarters. We entered into a lease with the buyer to leaseback the property for up to 18 months with an option to terminate earlier without penalty, upon providing a 90-day notice. The net proceeds received on the sale were $20.6 million and the lease has been accounted for as an operating lease. A gain on the sale of $10.8 million was recognized, and is presented within “Impairment and other charges, net” in our consolidated statement of earnings. Company as lessor — The following table presents rental income (in thousands):
| 2020
| Owned Properties |  | Leased Properties |  | Total
Operating lease income - franchise | $ | 19,785 |  |  | $ | 216,015 |  |  | $ | 235,800 |
Variable lease income - franchise | 9,960 |  |  | 74,887 |  |  | 84,847 |
Franchise rental revenues | $ | 29,745 |  |  | $ | 290,902 |  |  | $ | 320,647 |
Operating lease income - closed restaurants and other (1) | $ | — |  |  | $ | 6,370 |  |  | $ | 6,370 |
________________________ (1)Primarily relates to closed restaurant properties included in “Impairment and other, net” in our consolidated statement of earnings. The following table summarizes rents received in fiscal 2019 and 2018, as accounted for under previous guidance (in thousands):
| 2019 |  | 2018
Total rental income (1) | $ | 277,623 |  |  | $ | 264,432 |
Contingent rentals | $ | 38,506 |  |  | $ | 35,148 |
________________________ (1)Includes contingent rentals. The following table presents as of September 27, 2020, future minimum rental receipts for non-cancellable leases and subleases (in thousands):
| September 27, 2020
Fiscal year: |
2021 (1) | $ | 261,388 |
2022 | 234,545 |
2023 | 227,976 |
2024 | 202,636 |
2025 | 211,320 |
Thereafter | 1,067,624 |
Total minimum rental receipts | $ | 2,205,489 |
________________________ (1)The impact of rent concessions passed on to franchisees increased 2021 by $2.6 million. The following table presents as of September 29, 2019, future minimum rental receipts for non-cancellable leases and subleases (in thousands):
| September 29, 2019
Fiscal year: |
2020 | $ | 239,219 |
2021 | 255,315 |
2022 | 231,394 |
2023 | 224,605 |
2024 | 199,442 |
Thereafter | 1,215,811 |
Total minimum rental receipts | $ | 2,365,786 |
Assets held for lease and included in property and equipment consisted of the following at each fiscal year-end (in thousands):
|  | September 27, 2020 |  | September 29, 2019
Land |  | $ | 88,187 |  |  | $ | 91,130 |
Buildings |  | 801,730 |  |  | 817,400 |
Equipment |  | 589 |  |  | 537 |
|  | 890,506 |  |  | 909,067 |
Less accumulated depreciation |  | (650,812) |  |  | (632,197) |
|  | $ | 239,694 |  |  | $ | 276,870 |

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