28. Operating leases

During the year ended 31 December 2018, $101m (2017: $86m, 2016: $84m) was recognised as an expense in the Group income statement in respect of operating leases, net of amounts borne directly by the System Fund. An additional $5m (2017: $6m, 2016: $7m) has been charged to the System Fund. The expense, recorded in the Group Income Statement, includes contingent rents of $51m (2017: $32m, 2016: $32m). $2m (2017: $2m, 2016: $2m) was recognised as income from sub-leases.

Future minimum lease payments under non-cancellable operating leases are as follows:


	2018 $m		2017 $m
Due within one year		56		56
One to two years		54		46
Two to three years		67		45
Three to four years		35		60
Four to five years		31		30
More than five years		266		297

		509		534

The average remaining term of these leases, which generally contain renewal options, is approximately 15 years (2017: 15 years). No material restrictions or guarantees exist in the Group’s lease obligations.

In addition, in certain circumstances the Group is committed to making additional lease payments that are contingent on the performance of the hotels that are being leased.

The leases acquired with the UK portfolio acquisition (see note 11) include variable payments where rentals are linked to the performance of the hotels by way of reductions in rentals in the event that lower than target cash flows are generated by the hotels. In the event that rent reductions are not applicable, the Group’s exposure to this type of rental payment is £48m per annum over the remaining lease term of 25 years. Additional rentals, which are uncapped, are also payable calculated as a percentage of the profit earned by the hotels.

Total future minimum rentals expected to be received under non-cancellable sub-leases are $3m (2017: $4m).