LEASES
Lessee
A summary of operating lease expenses, net of insignificant sublease income, was as follows:
| | | | | | | | | | | | | | | | | |
| Year Ended December 31, |
| 2025 | | 2024 | | 2023 |
| Minimum rentals | $ | 41 | | | $ | 45 | | | $ | 49 | |
| Contingent rentals | 33 | | | 29 | | | 98 | |
| Total operating lease expenses | $ | 74 | | | $ | 74 | | | $ | 147 | |
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Total lease expenses related to short-term leases and finance leases were insignificant for each of the years ended December 31, 2025, December 31, 2024, and December 31, 2023.
During the years ended December 31, 2025 and December 31, 2024, certain operating lease ROU assets were included in asset groups deemed not fully recoverable (see Note 5). We recognized $2 million and $5 million of impairment charges during the years ended December 31, 2025 and December 31, 2024, respectively, related to these operating lease ROU assets in asset impairments on our consolidated statements of income (loss) within our owned and leased segment.
Supplemental balance sheet information related to finance leases was as follows:
| | | | | | | | | | | |
| December 31, 2025 | | December 31, 2024 |
| Property and equipment, net (1) | $ | 2 | | | $ | 3 | |
| | | |
| Current maturities of long-term debt | $ | 2 | | | $ | 2 | |
| Long-term debt | 1 | | | 2 | |
| Total finance lease liabilities | $ | 3 | | | $ | 4 | |
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(1) Finance lease assets are net of $20 million and $18 million of accumulated amortization at December 31, 2025 and December 31, 2024, respectively.
Weighted-average remaining lease terms and discount rates were as follows:
| | | | | | | | | | | |
| December 31, 2025 | | December 31, 2024 |
| Weighted-average remaining lease term in years | | | |
| Operating leases (1) | 14 | | 14 |
| Finance leases | 2 | | 2 |
| | | |
| Weighted-average discount rate | | | |
| Operating leases | 3.8 | % | | 3.8 | % |
| Finance leases | 2.8 | % | | 2.0 | % |
| (1) Certain of our hotel and land leases have nominal or contingent rental payments and were excluded from the weighted-average remaining lease term calculation resulting in a lower weighted-average term. |
The maturities of lease liabilities for the next five years and thereafter are as follows:
| | | | | | | | | | | |
| Year Ending December 31, | Operating leases (1) | | Finance leases |
| 2026 | $ | 44 | | | $ | 2 | |
| 2027 | 40 | | | 1 | |
| 2028 | 38 | | | — | |
| 2029 | 37 | | | — | |
| 2030 | 33 | | | — | |
| Thereafter | 158 | | | — | |
| Total minimum lease payments | $ | 350 | | | $ | 3 | |
| Less: amount representing interest | (72) | | | — | |
| Present value of minimum lease payments | $ | 278 | | | $ | 3 | |
(1) Operating lease payments have not been reduced by $53 million of future sublease receipts.
Lessor—We lease retail space under operating leases at certain of our owned hotels. Rental payments are primarily fixed with certain variable payments based on a contractual percentage of revenues. Rental income recognized in owned and leased revenues on our consolidated statements of income (loss) was follows:
| | | | | | | | | | | | | | | | | | |
| Year Ended December 31, | |
| 2025 | | 2024 | | 2023 | |
| Rental income | $ | 10 | | | $ | 8 | | | $ | 11 | | |
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The future minimum lease receipts scheduled to be received for the next five years and thereafter are as follows:
| | | | | |
| Year Ending December 31, | ((1) |
| 2026 | $ | 6 | |
| 2027 | 4 | |
| 2028 | 2 | |
| 2029 | 2 | |
| 2030 | 2 | |
| Thereafter | 11 | |
| Total minimum lease receipts | $ | 27 | |
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