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Lessor Operating Leases | 6 Months Ended
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Dec. 31, 2020
Lessor Disclosure [Abstract] |
Lessor Operating Leases | 9. Lessor Operating Leases Medical Equipment Leases Through its majority-owned subsidiary DME Inc., and the subsidiaries of DME Inc., the Company owns medical equipment which is leased to customers. The Company’s customers consist primarily of patients through their clinical providers including medical centers, clinics and hospices and the Company has lease arrangements with these patients. In addition, the arrangements between the Company and its customers are impacted by arrangements between the Company and Payors. The Payors may cover a portion or all of the rental payments under the agreements between the Company and its customers. The patient is responsible for any residual co-payments. The lease terms may be for a pre-determined time period, generally 10 months to 36 months; however, the customer may cancel the lease at any time and for any reason without penalty and therefore, the Company treats all leases as month-to-month leases. Upon termination of the lease, the equipment, if not aged beyond its useful life, may be refurbished and subsequently sold or leased to another customer. As the leases are month-to-month, there are no future lease receivables under the terms of the current leases. Real Estate Leases The Company’s majority-owned subsidiary CRIC IT Fort Myers LLC (Property Owner) owns a fee simple interest in two Class A office buildings, Gartner I and Gartner II (collectively, the Property). The Property is fully leased, on a triple net basis, to Gartner, Inc. (Gartner) until March 31, 2030, which may be extended at the option of Gartner in accordance with the terms of the lease. The Gartner I lease contains two five-year extensions and the Gartner II lease contains three five-year extensions (collectively, the Leases). Under the terms of the Leases, the renewal rates are equal to 95% of the then fair market rent, and the tenant does not have a purchase option at the end of the lease term. The leases require Gartner to make a base monthly lease payment of approximately $0.4 million as calculated on a straight-line basis over the remaining expected lease term plus additional rent payments for additional costs. Additional rental payments are due for Property Owner costs, such as property taxes, management fees, and insurance costs, as incurred. See Note 3 – Revenue for additional discussion of rental revenues. The Property is subject to mortgage, security agreement and assignment of leases and rents with the senior and subordinated lenders, which is further described in Note 10 - Borrowings. The Property Owner has assigned all rights, title and interest in and to the Property and the Leases to the senior and subordinated lenders and all amounts received are paid to a trust which funds the operating costs associated with the Property. The Company does not have rights to these rent payments while the borrowings remain outstanding. The Company expects to derive value from the residual value at the end of the existing lease term by further leasing the assets or through a sale transaction. Rental income from real estate leases is summarized in the following table:
|  | For the three months ended December 31, |  |  | For the six months ended December 31, |
(in thousands) |  | 2020 |  |  | 2019 |  |  | 2020 |  |  | 2019 |
Revenues from base rents |  | $ | 1,151 |  |  | $ | 1,152 |  |  | $ | 2,302 |  |  | $ | 2,303 |
Revenues from additional rental payments |  |  | 124 |  |  |  | 119 |  |  |  | 246 |  |  |  | 241 |
Total rental revenues |  | $ | 1,275 |  |  | $ | 1,271 |  |  | $ | 2,548 |  |  | $ | 2,544 |
The following table summarizes the base rents for the remaining lease term:
(in thousands) |  | Base Rent Payments |
For the six months ending June 30, 2021 |  | $ | 2,124 |
For the year ending June 30, 2022 |  |  | 4,312 |
For the year ending June 30, 2023 |  |  | 4,419 |
For the year ending June 30, 2024 |  |  | 4,529 |
For the year ending June 30, 2025 |  |  | 4,648 |
Thereafter |  |  | 24,025 |
Total base rent |  | $ | 44,057 |

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- Definition The entire disclosure for lessor's operating leases. + References Reference 1: http://www.xbrl.org/2003/role/exampleRef -Publisher FASB -Name Accounting Standards Codification -Topic 840 -SubTopic 10 -Section 55 -Paragraph 40 -Subparagraph Note 1 -URI http://asc.fasb.org/extlink&oid=121580752&loc=d3e38371-112697 Reference 2: http://www.xbrl.org/2003/role/exampleRef -Publisher FASB -Name Accounting Standards Codification -Topic 840 -SubTopic 10 -Section 55 -Paragraph 40 -Subparagraph Note 3 -URI http://asc.fasb.org/extlink&oid=121580752&loc=d3e38371-112697 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 30 -URI http://asc.fasb.org/subtopic&trid=77888252 + Details
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