DSW 2014 Annual Report Download - page 64

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Table of Contents

The balance sheet caption "Non-current liabilities" was comprised of the following as of the periods presented:
January 31, 2015
February 1, 2014
(in thousands)
Construction and tenant allowances
$ 85,244
$ 84,464
Deferred rent
38,021
37,985
Other(1)
20,068
15,849
Total non-current liabilities
$ 143,333
$ 138,298
(1) Other is comprised of a loss under an operating lease, income tax reserves and deferred compensation.
The Company estimated its future liability under a lease of an office building assumed in the merger based on its current lease payments and executory costs,
net of estimated sublease rentals. The Company estimated inflationary increases in its executory costs (utilities and real estate taxes) and used its credit-
adjusted risk-free rate to present value its liability. The non-cash impairment charges were included in operating expenses in fiscal 2012 and fiscal 2011. The
liability is currently $10.9 million and is included in other non-current liabilities.
 
The Company leases stores, its fulfillment center and other facilities under various arrangements with related and unrelated parties. Such leases expire
through 2028 and in most cases provide for renewal options. Generally, the Company is required to pay base rent, real estate taxes, maintenance, insurance
and contingent rentals based on sales in excess of specified levels. Under supply agreements, the Company pays contingent rents based on sales for the shoe
departments it operates through ABG. As of January 31, 2015 and February 1, 2014, the Company had no capital leases.
As of January 31, 2015, the Company leased or had other agreements with entities affiliated with Schottenstein Affiliates for 19 store locations and its
fulfillment center for a total annual minimum rent for fiscal 2014 of $9.2 million. The Company leased a portion of its corporate office headquarters to a
Schottenstein Affiliate for annual rent of $0.2 million. On December 6, 2014, this lease was terminated. Related party rental income for fiscal 2014, fiscal
2013 and fiscal 2012 was $0.1 million, $0.2 million and $0.1 million, respectively.
The following table presents future minimum lease payments required under the aforementioned leases, excluding real estate taxes, insurance and
maintenance costs, as of January 31, 2015:
Total
Unrelated
Party
Related
Party
Fiscal years (in thousands)
2015 $ 183,635
$ 174,196
$ 9,439
2016 172,263
163,308
8,955
2017 151,361
143,153
8,208
2018 130,171
125,780
4,391
2019 112,854
109,039
3,815
Future years 378,699
371,577
7,122
Total minimum lease payments (1) $ 1,128,983
$ 1,087,053
$ 41,930
(1) Minimum payments have been reduced by minimum sublease rentals of $1.4 million due in the future under noncancelable subleases.
The following table presents the composition of rental expense for the periods presented:
F- 24
Source: DSW Inc., 10-K, March 26, 2015 Powered by Morningstar® Document Research℠
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except to the extent such damages or losses cannot be limited or excluded by applicable law. Past financial performance is no guarantee of future results.