Finance lease term

[Table of Contents](#i36695dc5143241f795c32e47bf5f4b3d_7)CBRE GROUP, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)12.LeasesSupplemental balance sheet information related to our leases is as follows (dollars in thousands):

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  | December 31, |
| Category |  | Classification |  | 2021 |  | 2020 |
| Assets |  |  |  |  |  |  |
| Operating |  | Operating lease assets |  | $ | 1,046,377  |  |  | $ | 1,020,352  |  |
| Financing |  | Other assets, net |  | 110,809  |  |  | 117,805  |  |
| Total leased assets |  |  |  | $ | 1,157,186  |  |  | $ | 1,138,157  |  |
|  |  |  |  |  |  |  |
| Liabilities |  |  |  |  |  |  |
| Current: |  |  |  |  |  |  |
| Operating |  | Operating lease liabilities |  | $ | 232,423  |  |  | $ | 208,526  |  |
| Financing |  | Other current liabilities |  | 38,103  |  |  | 39,298  |  |
| Non-current: |  |  |  |  |  |  |
| Operating |  | Non-current operating lease liabilities |  | 1,116,562  |  |  | 1,116,795  |  |
| Financing |  | Other liabilities |  | 73,257  |  |  | 78,881  |  |
| Total lease liabilities |  |  |  | $ | 1,460,345  |  |  | $ | 1,443,500  |  |

Components of lease cost are as follows (dollars in thousands):

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  | Year Ended December 31, |
| Component |  | Classification |  | 2021 |  | 2020 |
| Operating lease cost |  | Operating, administrative and other |  | $ | 196,685  |  |  | $ | 204,415  |  |
| Financing lease cost: |  |  |  |  |  |  |
| Amortization of right-to-use assets |  | (1) |  | 36,376  |  |  | 38,568  |  |
| Interest on lease liabilities |  | Interest expense |  | 1,301  |  |  | 1,847  |  |
| Variable lease cost |  | (2) |  | 70,091  |  |  | 74,332  |  |
| Sublease income |  | Revenue |  | (2,271) |  |  | (2,643) |  |
| Total lease cost |  |  |  | $ | 302,182  |  |  | $ | 316,519  |  |

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_(1)Amortization costs of $31.9 million and $32.7 million from vehicle finance leases utilized in client outsourcing arrangements are included in the “Cost of revenue” line item in the accompanying consolidated statements of operations for the years ended December 31, 2021 and 2020, respectively. Amortization costs of $4.4 million and $5.9 million from all other finance leases are included in the “Depreciation and amortization” line item in the accompanying consolidated statements of operations for the years ended December 31, 2021 and 2020, respectively.(2)Variable lease costs of $16.8 million and $17.1 million from leases in client outsourcing arrangements are included in the “Cost of revenue” line item in the accompanying consolidated statements of operations for the years ended December 31, 2021 and 2020, respectively. Variable lease costs of $53.3 million and $55.6 million from all other leases are included in the “Operating, administrative, and other” line item in the accompanying consolidated statements of operations for the years ended December 31, 2021 and 2020, respectively.Weighted average remaining lease term and discount rate for our operating and finance leases are as follows:

|  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |
|  | December 31, |
|  | 2021 |  | 2020 |
| Weighted-average remaining lease term: |  |  |  |
| Operating leases | 8 years |  | 8 years |
| Financing leases (1) | 72 years |  | 71 years |
| Weighted-average discount rate: |  |  |  |
| Operating leases | 2.9% |  | 3.1% |
| Financing leases (1) | 5.0% |  | 5.0% |

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_(1)Finance leases as of December 31, 2021 and 2020 included a 99 year lease on a real estate under development. If excluded, the weighted-average remaining lease term and weighted-average discount rate would be 3 years and 1.8%, respectively, as of December 31, 2021 and 3 years and 2.1%, respectively, as of December 31, 2020.97
