Gladstone Commercial Corporation Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Commitments and Contingencies

Commitments and Contingencies

3 Months Ended

Mar. 31, 2019

Commitments and Contingencies Disclosure [Abstract]

Ground Leases

We are obligated as lessee under four ground leases. Future lease payments due under the terms of these leases as of March 31, 2019 are as follows (dollars in thousands):



Year	Future Lease Payments Due Under Operating Leases
Nine Months Ending December 31, 2019	$	349
2020	466
2021	477
2022	489
2023	492
2024	493
Thereafter	7,799
Total anticipated lease payments	$	10,565
Less: amount representing interest	(4,617		)
Present value of lease payments	$	5,948

Rental expense incurred for properties with ground lease obligations during the three months ended March 31, 2019 and 2018 was $0.1 million and $0.1 million, respectively. Our ground leases are treated as operating leases and rental expenses are reflected in property operating expenses on the condensed consolidated statements of operations and comprehensive income.

Future minimum rental payments due under the terms of these leases as of December 31, 2018, are as follows (dollars in thousands):



For the year ended December 31,	Minimum Rental Payments Due
2019	$	465
2020	466
2021	392
2022	319
2023	322
Thereafter	3,914
	$	5,878

Letters of Credit

As of March 31, 2019, there was $7.4 million outstanding under letters of credit. These letters of credit are not reflected on our condensed consolidated balance sheets.