Financial Information

PART II

Item 8. Financial Statements and Supplementary Data.

MARRIOTT INTERNATIONAL, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 11. PROPERTY AND EQUIPMENT

The following table presents the composition of our property and equipment balances at year-end 2019 and 2018:

We record property and equipment at cost, including interest and real estate taxes we incur during development and construction. We capitalize the cost of improvements that extend the useful life of property and equipment when we incur them. These capitalized costs may include structural costs, equipment, fixtures, floor, and wall coverings. We expense all repair and maintenance costs when we incur them. We compute depreciation using the straight-line method over the estimated useful lives of the assets (generally three to 40 years), and we amortize leasehold improvements over the shorter of the asset life or lease term. Our gross depreciation expense totaled $346 million in 2019, $256 million in 2018, and $231 million in 2017 (of which $121 million in 2019, $147 million in 2018, and $126 million in 2017 was included in the “Reimbursed expenses” caption of our Income Statements). Fixed assets attributed to operations located outside the U.S. were $695 million in 2019 and $533 million in 2018.

In the 2019 fourth quarter, we recorded impairment charges to reduce the carrying amount of the Renaissance New York Times Square Hotel property and equipment, including leasehold improvements, and right-of-use asset as discussed in Note 8.