23. Lease liabilities
As of 1 January 2019 IFRS 16 is implemented in the balance sheet and P&L. In order to implement IFRS 16 a number of key options and practical expedients allowed under IFRS 16 were adopted of which the following are the most significant:
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A modified retrospective approach was applied and therefore prior periods were not restated;
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Not to recognise right-of-use assets and lease liabilities for short-term leases that have a lease term of 12 months or less and leases of low-value assets. The lease payments associated with these leases are recognised as an expense on a straight–line basis over the lease term;
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To apply the ‘grandfather’ option, which means that all conclusions previously reached under IAS 17 (and IFRIC 4 Determining Whether an Arrangement Contains a Lease) are deemed compliant with IFRS 16;
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To use hindsight in determining the lease term.
The lease liabilities can be specified as follows:
31-12-2023 | 31-12-2022 | |
Land leases | 127 | 146 |
Car leases | 3 | 3 |
Office rental contracts | - | - |
Total | 130 | 149 |
Lease liabilities | ||
Balance on 1 January 2022 | 146 | |
New lease contracts | 1 | |
Buy-off landlease | - | |
Amortization | (1) | |
Revaluation | 3 | |
Balance as per 31 December 2022 | 149 | |
New lease contracts | 1 | |
Buy-off landlease | (20) | |
Amortization | (1) | |
Revaluation | 1 | |
Balance as per 31 December 2023 | 130 |
31-12-2023 | 31-12-2022 | |
Maturity | ||
Year 1 | 1 | 1 |
Year 2 | 1 | 1 |
Year 3 | 1 | 1 |
Year 4 | - | - |
Year 5 | - | - |
Onwards | 127 | 146 |
Total | 130 | 149 |
31-12-2023 | 31-12-2022 | |
Current | 1 | 1 |
Non-current | 129 | 148 |
The total amount of lease liabilities in 2023 is €130 million. This includes land leases (€127 million), car leases and rent of offices (€3 million). In 2023 the lease liabilities decreased with €19 million mainly due to the buyback of landlease.
Land lease liabilities
The land liabilities are calculated based on a perpetual view. These land leases require monthly, quarterly, (semi) annual payments if the lease obligation is not redeemed for a certain time frame. For some land leases, a variable component is applicable based on an index. The lease liabilities are reassessed and re-measured after a new index is applicable or the lease payments are changed after a certain time frame by the lessor based on contractual terms.
The assumptions are based on the value of the contracts, or in case of the land leases based on value of the ground (WOZ) x increase factor (market increase). The weighted average discount rate used in 2023 by Vesteda for discounting the lease payments is 3.1%.