Commitments and Contingencies
Operating Leases
The Company leases office space from third parties for our corporate and property management operations under non-cancelable operating lease agreements. Our operating leases have remaining lease terms of one to six years before any unexercised options to extend. For the years ended December 31, 2025, 2024 and 2023, operating lease costs were as follows (amounts in thousands):
| | | | | | | | | | | | | | | | | | |
| | For the Years Ended December 31, | |
| | 2025 | | 2024 | | 2023 | |
| Lease costs | $ | 4,262 | | | $ | 4,018 | | | $ | 4,014 | | |
Other information related to our operating lease terms and discount rates were as follows:
| | | | | | | | | | | | |
| December 31, 2025 | | December 31, 2024 | |
| Weighted-average remaining lease term | 4.7 years | | 5.3 years | |
| Weighted-average discount rate | 3.9 | % | | 3.2 | % | |
Future lease obligations for our operating leases as of December 31, 2025 were as follows (amounts in thousands):
| | | | | |
| Operating Lease Obligations |
| 2026 | $ | 4,353 | |
| 2027 | 4,041 | |
| 2028 | 3,494 | |
| 2029 | 3,106 | |
| 2030 | 2,696 | |
| Thereafter | 1,090 | |
| Total lease payments | 18,780 | |
| Less: imputed interest | (1,584) | |
| Operating lease liabilities | $ | 17,196 | |
Other Commitments
As of December 31, 2025, the Company had $86.5 million in purchase commitments for land relating to our AMH Development Program, which includes certain land deals expected to close beyond twelve months when development is ready to commence. Purchase commitments exclude option contracts where we have acquired the right to purchase land for our AMH Development Program or single-family properties because the contracts do not contain provisions requiring our specific performance.
As of December 31, 2025, the Company had sales in escrow for 248 of our single-family properties and 195 of our land lots for an aggregate selling price of $92.9 million.
As of December 31, 2025, the Company, as a condition for entering into some of its development contracts, had outstanding surety bonds of approximately $169.9 million.
401(k) Retirement Savings Plan
We have a retirement savings plan pursuant to Section 401(k) of the Code whereby our employees may contribute a portion of their compensation to their respective retirement accounts in an amount not to exceed the maximum allowed under the Code. In addition to
employee contributions, we have elected to provide company contributions (subject to statutory limitations), which amounted to approximately $4.0 million, $3.8 million and $3.6 million for the years ended December 31, 2025, 2024 and 2023, respectively.
Captive Insurance Company
The Company has a wholly owned captive insurance company, American Dream Insurance, LLC, which provides general liability insurance coverage for losses below the deductible under the Company’s third-party liability insurance policy. The Company created American Dream Insurance, LLC as part of its overall risk management program and to stabilize its insurance costs, manage exposure and recoup expenses through the functions of the captive program. The captive insurance company’s impact on the Company’s consolidated financial statements is immaterial.
Legal Matters
We are involved in various legal and administrative proceedings that are incidental to our business. We believe these matters will not have a materially adverse effect on our financial position or results of operations upon resolution.