Company: CIO
Filing Date: 2025-02-20
Form Type: 10-K
Source: 0000950170-25-023714
Chunk: 24

Company: City Office REIT, Inc.
Filing Date: 2025-02-20
Form: 10-K
Item: Item 15
Chunk 24
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 and 2022, the Company earned $0.2 million, $0.1 million, and $0.3 million, respectively, for administrative services performed for SCRE II and its affiliates.On July 31, 2019, an indirect, wholly owned subsidiary of the Company entered into an administrative services agreement with Clarity Real Estate Ventures GP, Limited Partnership ("Clarity"), an entity affiliated with principals of Second City and officers of the Company. Pursuant to the Administrative Services Agreement, the Company will provide various administrative services and support to the related entity managing the Clarity funds. During the year ended December 31, 2024, the amounts earned by the Company for administrative services performed for Clarity were nominal. For the years ended December 31, 2023, and 2022, the Company earned $0.2 million and $0.3 million, respectively, for administrative services performed for Clarity. 9. LeasesLessor AccountingThe Company is focused on acquiring, owning and operating office properties for lease to a stable and diverse tenant base. The Company’s properties have both full-service gross and net leases which are generally classified as operating leases.  Rental income related to such leases is recognized on a straight-line basis over the remaining lease term. The Company’s total revenue includes fixed base rental payments provided under the lease and variable payments, which principally consist of tenant expense 

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 reimbursements for certain property operating expenses as provided under the lease. The Company elected the practical expedient to account for its lease and non-lease components as a single combined operating lease component under ASC 842. As a result, rental income, expense reimbursement, and other were aggregated into a single line within rental and other revenues on the consolidated statements of operations. The Company recognized fixed and variable lease payments for operating leases for the years ended December 31, 2024 and December 31, 2023 as follows (in thousands): 

         Years Ended December 31,

         2024

         2023

         Fixed payments
          
         $
         146,189

         $
         149,203

         Variable payments

         24,507

         26,826

         $
         170,696

         $
         176,029

        The Company ceased recognizing rental lease income with respect to the Cascade Station property on the deconsolidation of the entity on June 27, 2024. The Company ceased recognizing rental lease