38.Operating lease arrangements
The Group as lessor
Property rental income earned during the year was HK$264,975,000 (2009: HK$250,726,000). The properties held had committed leases mainly running for the next one to six years.
Contingent rental income was calculated based on the excess of certain percentage of revenue of the relevant operation that occupied certain of the properties over the fixed portion of the monthly rentals. Contingent rental income earned during the year ended 31 December 2010 is HK$567,000 (2009: nil).
At the end of the reporting period, the Group had contracted with tenants for the following future minimum lease payments in respect of investment properties which fall due as follows:
Within one year In the second to fifth years inclusive After five years
204,635 326,755 69,331
193,368 343,543 16,268
Where leases are negotiated at a fixed rate for the first few years, but subject to renegotiation for the remaining contracted lease terms, the minimum lease payments are calculated based on the latest negotiated rent, if any.
The Group as lessee
Within one year In the second to fifth years inclusive
At the end of the reporting period, the Group had outstanding commitments under non-cancellable operating leases in respect of rented premises which fall due as follows:
Operating lease payments represent rentals payable by the Group for certain of its office premises. Leases are negotiated for term of one to three years and rentals are fixed over the respective leases.
Annual Report 2010