CVS, Walgreens Warn Billions of Leases Coming to Balance Sheets

That drug store on the corner pays top dollar to attract passing walk-in traffic. Nationwide, that adds up to billions of dollars’ worth of retail leases that until now have stayed off pharmacy companies’ financial reports.

Public companies in 2019 will start reporting on their balance sheets trillions of dollars’ worth of leased assets, including long-term leases for retail stores, airplanes, and warehouses. Companies also will report lease related debt on the balance sheet under rules issued by the Financial Accounting Standards Board in 2016.

“Our expectation is, for retail in general, you will see some sizable amounts come onto ...