Annual Report 2020

149 Notes to the Financial Statements Miramar Hotel and Investment Company, Limited Annual Report 2020 10 Investment properties, other property, plant and equipment (Continued) (c) The analysis of cost or valuation of properties is as follows: 2020 2019 HK$’000 HK$’000 Land and buildings in Hong Kong: – long leases 145 145 – medium term leases 14,707,454 14,836,917 Land and buildings outside Hong Kong: – medium term leases 733,160 681,183 – freehold 57,051 53,887 15,497,810 15,572,132 (d) The Group leases out properties under operating leases. The leases typically run for an initial period of 1 to 5 years, with an option to renew the lease after that date at which time all terms are renegotiated. Lease payments may be varied periodically to reflect market rentals and may contain a contingent rental element which is based on various percentages of tenant’s sales receipts. Future minimum lease income under non-cancellable operating leases are disclosed in note 25. The total variable lease income recognised in the consolidated statement of profit or loss for the year are HK$6,392,000 (2019: HK$12,067,000). (e) Right-of-use assets The Group has obtained the right to use other properties as its operating outlets through tenancy agreements. The leases typically run for an initial period of 1 to 11 years, with an option to renew the lease when all terms are renegotiated. Lease payments are usually increased annually to reflect market rentals.