EPR PROPERTIES
For the period ended Mar 31, 2025. Filed May 8, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2025 · Filed May 8, 2025
EPR$59.51-0.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-10-31.
0001045450-24-000086
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-05-08.
0001045450-25-000082
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 127 previous paragraphs and 109 current paragraphs.
60 unchanged; 36 reworded; 11 added; 31 removed; 0 previous and 2 current paragraphs rearranged.
Tables are not compared: 10 previous and 10 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (11)
Current report
•154 theatre properties;
Current report
•25 attraction properties;
Current report
•four experiential lodging properties;
Current report
As a triple-net lease REIT, we are generally experiencing heightened risks and uncertainties associated with key macroeconomic factors including inflation and interest rate volatility. In recent months, the U.S. government has imposed, and is considering imposing, tariffs and trade restrictions on certain goods produced outside of the United States, including a recent indication that a significant tariff on foreign-made films may be imposed. In response to these actions, certain foreign jurisdictions have imposed, or are considering imposing, tariffs and retaliatory restrictions on goods produced in the United States. In addition, the U.S. government has announced and rescinded multiple tariffs on several foreign jurisdictions, which has increased uncertainty regarding the ultimate effect of tariffs on economic conditions.
Current report
The overall economic uncertainty caused by these or additional changes in the U.S. or international trade policy, along with continued uncertainty surrounding such policies, could also lead to weakened economic conditions, contribute to inflation and increased borrowing costs and could lead to decreased consumer spending. This environment has created negative pressure in the financial and capital markets resulting in a higher cost of capital. Additionally, tariff increases may impact us by increasing the cost of imported construction materials, which in turn can lead to higher development and renovation expenses. This increase in costs may result in reduced yields on development projects and potentially delay or result in cancelling planned projects. Furthermore, our tenants are similarly experiencing negative pressures from these uncertain economic conditions, which could negatively affect their ability to satisfy their obligations to us.
Current report
•The recognition of retirement and severance expense for the three months ended March 31, 2024 versus no such expense recognized for the three months ended March 31, 2025;
Current report
During thethree months ended March 31, 2025, we received $8.1 million in proceeds representing prepayment in full on two mortgage note receivables that were secured by two early childhood education center properties.
Current report
Upon maturity, on April 1, 2025, we fully repaid $300.0 million of senior unsecured notes using borrowings under our $1.0 billion senior unsecured revolving credit facility.
Current report
(1) Retirement and severance expense for the three months ended March 31, 2024 related primarily to the retirement of our former Executive Vice President, General Counsel and Secretary. There was no retirement and severance expense for the three months ended March 31, 2025.
Current report
(2) The change in provision (benefit) for credit losses, net for the three months ended March 31, 2025 compared to the three months ended March 31, 2024 was due primarily to a release from an additional $4.0 million in funding commitments on one mortgage note receivable and changes in our estimated current expected credit losses based on macro-economic conditions.
Current report
In 2024, two experiential lodging properties located in St. Pete Beach, Florida, in which we hold unconsolidated equity investments through two joint ventures, were severely damaged by two hurricanes and remain closed. We continue to work in good faith with our joint venture partners, the non-recourse debt provider and the insurance companies to identify a path forward in which we expect to result in the removal of the unconsolidated equity investments in these experiential lodging properties and the related non-recourse debt from our portfolio, although there can be no assurances as to the outcome of those discussions.
Removed paragraphs (31)
Previous report
•159 theatre properties;
Previous report
•24 attraction properties;
Previous report
•seven experiential lodging properties;
Previous report
The combined owned portfolio consisted of 20.8 million square feet and was 99% leased excluding the 0.4 million square feet of properties we intend to sell.
Previous report
As of September 30, 2024, as a result of the COVID-19 pandemic, we continue to recognize revenue on a cash basis for AMC and two other tenants, one of which has deferred rent from this period that is not booked as a receivable of approximately $11.5 million. We collected all deferred receivables from accrual basis tenants that were deferred due to the COVID-19 pandemic. During the nine months ended September 30, 2024 and 2023, we collected $0.6 million and $35.7 million, respectively, in deferred rent and interest from cash basis customers and from customers for which the deferred payments were not previously recognized as revenue.
Previous report
•The decrease in rental revenue due to a comprehensive restructuring agreement with Regal and higher deferred rental payments from cash basis tenants received in 2023;
Previous report
•The increase in other income and other expense related to additional operating properties;
Previous report
•The decrease in impairment charges and general and administrative expense;
Previous report
•The increase in equity in loss from joint ventures and the increase in impairment charges on joint ventures;
Previous report
Impairment Charges
Previous report
During the nine months ended September 30, 2024, we reassessed the holding period of one of our theatre properties that is operated through a third-party management agreement. We determined that the carrying value of the theatre property did not exceed the sum of the undiscounted cash flows and estimated the fair value of the real estate investments of this property using an independent appraisal. Accordingly, we recognized impairment charges totaling $11.8 million for the nine months ended September 30, 2024.
Previous report
During and subsequent to the nine months ended September 30, 2024, two experiential lodging properties located in St. Pete Beach, Florida that we hold as equity investments through joint ventures, were significantly damaged by two weather events. On September 26, 2024, Hurricane Helene made landfall on St. Pete Beach as a Category 3 storm and damaged the joint ventures' experiential lodging properties. On October 9, 2024, further damage was caused by Hurricane Milton. The properties will remain closed as the joint ventures continue to assess and repair damage and we do not anticipate that the properties will re-open until well into 2025. We plan to work in good faith with our joint venture partners, the non-recourse debt provider and the insurance companies to identify a path forward which we expect will result in the eventual removal of both experiential properties from our portfolio. Accordingly, we determined that our investment in these joint ventures had no fair value and was not recoverable, and during the third quarter of 2024, recognized $12.1 million in other-than-temporary impairment charges on joint ventures related to these equity investments.
Previous report
Retirement and Severance Expense
Previous report
On March 1, 2024, our Executive Vice President, General Counsel and Secretary, Craig Evans, retired. Details of Mr. Evans' retirement are included in the previously disclosed Retirement and Release Agreement entered into between us and Mr. Evans. The role of General Counsel and Secretary was assumed by Paul Turvey upon Mr. Evans' retirement. For the three months ended March 31, 2024, we recorded retirement and severance expense related to Mr. Evans' retirement, as well as the departure of another employee, totaling $1.8 million, which included cash payments totaling $0.2 million and accelerated vesting of nonvested shares totaling $1.6 million.
Previous report
During the nine months ended September 30, 2024, we entered into a Fourth Amended, Restated and Consolidated Credit Agreement (the "Amended Credit Agreement"). See discussion below in Liquidity and Capital Resources and Note 8 to the consolidated financial statements in this Quarterly Report on Form 10-Q for additional information.
Previous report
Three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023
Previous report
For the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023, the decrease in minimum rent resulted from a decrease of $11.5 million related to the comprehensive restructuring agreement with Regal entered into on June 27, 2023, a $32.7 million decrease in deferred rental repayments from cash basis tenants, a $4.6 million decrease from property dispositions and a $1.6 million decrease from vacant properties. This decrease was partially offset by an increase in rental revenue of $5.9 million related to property acquisitions and developments completed in 2024 and 2023 and an increase in rental revenue on existing properties of $4.6 million.
Previous report
During the nine months ended September 30, 2024, we renewed ten lease agreements on approximately 295 thousand square feet and experienced a decrease of approximately 0.5% in rental rates and paid no leasing commissions with respect to these lease renewals.
Previous report
(3) The increase in straight-line rent for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023 was due to property acquisitions and developments completed in 2024 and 2023 as well as straight-line rent receivable for Regal recognized during the nine months ended September 30, 2024 in connection with reestablishing accrual basis accounting for Regal at August 1, 2023.
Previous report
(4) The increase in other income for the three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023 related primarily to an increase in operating income from the addition of five operating theatre properties in the third quarter of 2023 that were previously leased by Regal. One of these properties was closed on September 20, 2024 and is currently vacant as we prepare to sell it.
Previous report
(1) The increase in other expense for the three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023 related primarily to the addition of operating expense from five theatre properties that were previously leased by Regal. One of these properties was closed on September 20, 2024 and is currently vacant as we prepare to sell it.
Previous report
(2) The decrease in general and administrative expense for the three months ended September 30, 2024 compared to the three months ended September 30, 2024 related primarily to a decrease in payroll and benefit costs. The decrease in general and administrative expense during the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023 related to a decrease in payroll and benefit costs, a decrease in franchise taxes due to a state legislative change that went into effect during the second quarter of 2024 as well as a decrease in professional fees, including those related to the comprehensive restructuring agreement with Regal in 2023.
Previous report
(3) Impairment charges recognized during the nine months ended September 30, 2024 related to one theatre property that was operated through a third-party management agreement but, as disclosed above, was closed on September 20, 2024 and is currently vacant as we prepare to sell it. Impairment charges recognized during the three months ended September 30, 2023, related to two theatre properties that were part of a workout with a smaller theatre tenant and impairment charges recognized during the nine months ended September 30, 2023 related to these two theatre properties and eight properties surrendered by Regal not included in the new master lease.
Previous report
The gain on sale of real estate for the nine months ended September 30, 2024 related to the sale of two cultural properties, six vacant theatre properties, one leased theatre property and one vacant early childhood education center. The net gain on sale of real estate for the nine months ended September 30, 2023 related to the sale of two vacant theatre properties, one vacant eat & play property, three vacant early childhood education centers and a land parcel.
Previous report
(5) The increase in interest expense, net for the three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023 resulted primarily from an increase in average borrowings and an increase in our weighted average interest rate on outstanding debt due to borrowings on our unsecured revolving credit facility. This increase was also due to a decrease in interest income from short-term investments related to cash on hand.
Previous report
(6) The increase in equity in loss from joint ventures for the three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023 primarily related to higher expenses, including insurance, depreciation and interest, at our joint ventures during the three and nine months ended September 30, 2024 as well as the impact from Hurricane Helene that damaged two hotels in St. Pete Beach, Florida as discussed above.
Previous report
(7) The increase in impairment charges on joint ventures for the three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023 related to other-than-temporary impairments of our equity investments in two joint ventures holding two experiential lodging properties located in St. Pete Beach, Florida due to hurricane damage described above.
Previous report
At September 30, 2024, we had$169.0 million outstanding balance under our $1.0 billion unsecured revolving credit facility. On July 3, 2024, we amended our Third Amended, Restated and Consolidated Credit Agreement, which governs our unsecured revolving credit facility, to incorporate the Canadian Overnight Repo Rate Average (CORRA) as a replacement index rate benchmark with respect to loans denominated in Canadian Dollars (CAD) as the Canadian Dollar Offered Rate (CDOR) has been phased out.
Previous report
On September 19, 2024, we entered into the Amended Credit Agreement providing for a new amended and restated senior unsecured revolving credit facility. The Amended Credit Agreement amended, restated and replaced our prior senior unsecured revolving credit facility provided under the Third Amended, Restated and Consolidated Credit Agreement. The amendments to the prior facility, among other things: (i) extended the maturity date of the revolving credit facility; (ii) generally reduced the interest rate payable on outstanding loans; (iii) eliminated the tangible net worth covenant; (iv) modified the secured debt to total assets financial covenant to permit increased secured debt if we so elect; and (v) modified and simplified the capitalization rates used to value assets under the facility.
Previous report
In connection with entering into the Amended Credit Agreement, we incurred $9.0 million in fees that were capitalized in deferred financing costs and amortized as part of the effective yield. These fees are included in "Other assets" in the accompanying consolidated balance sheet as of September 30, 2024. During the nine months ended September 30, 2024, we also recorded a non-cash write-off of deferred financing costs (net of accumulated amortization), totaling $0.3 million to "Costs associated with loan refinancing or payoff" in connection with entering into the Amended Credit Agreement.
Previous report
In connection with construction of our development projects and related infrastructure, certain public agencies require posting of surety bonds to guarantee that our obligations will be satisfied. These bonds expire upon the completion of the improvements or infrastructure. As of September 30, 2024, we had three surety bonds outstanding totaling $0.6 million.
Reworded paragraphs (36)
Previous wording
The following discussion should be read in conjunction with the consolidated financial statements and notes thereto included in this Quarterly Report on Form 10-Q of EPR Properties (the “Company”, “EPR”, “we” or “us”). The forward-looking statements included in this discussion and elsewhere in this Quarterly Report on Form 10-Q involve risks and uncertainties, including anticipated financial performance, anticipated liquidity and capital resources, business prospects, industry trends, shareholder returns, performance of leases by tenants, performance on loans to customers and other matters, which reflect management's best judgment based on factors currently known. See “Cautionary Statement Concerning Forward-Looking Statements,” which is incorporated herein by reference. Actual results and experience could differ materially from the anticipated results and other expectations expressed in our forward-looking statements as a result of a number of factors, including but not limited to those discussed in Item 1A - "Risk Factors" in our 2023 Annual Report.
Current wording
The following discussion should be read in conjunction with the consolidated financial statements and notes thereto included in this Quarterly Report on Form 10-Q of EPR Properties (the “Company”, “EPR”, “we” or “us”). The forward-looking statements included in this discussion and elsewhere in this Quarterly Report on Form 10-Q involve risks and uncertainties, including anticipated financial performance, anticipated liquidity and capital resources, business prospects, industry trends, shareholder returns, performance of leases by tenants, performance on loans to customers and other matters, which reflect management's best judgment based on factors currently known. See “Cautionary Statement Concerning Forward-Looking Statements,” which is incorporated herein by reference. Actual results and experience could differ materially from the anticipated results and other expectations expressed in our forward-looking statements as a result of a number of factors, including but not limited to those discussed in Part II, Item 1A - "Risk Factors" in this Quarterly Report on Form 10-Q and Item 1A - "Risk Factors" in our 2024 Annual Report.
Previous wording
Our investment portfolio includes ownership of and long-term mortgages on Experiential and Education properties. Substantially all of our owned single-tenant properties are leased pursuant to long-term, triple-net leases, under which the tenants typically pay all operating expenses of the property. Tenants at our owned multi-tenant properties are typically required to pay common area maintenance charges to reimburse us for their pro-rata portion of these costs. We also own certain experiential lodging assets structured using traditional REIT lodging structures.
Current wording
Our investment portfolio includes ownership of and long-term mortgages on Experiential and Education properties. Substantially all of our owned single-tenant properties are leased pursuant to long-term, triple-net leases, under which the tenants typically pay all operating expenses of the property. Tenants at our owned multi-tenant properties are typically required to pay common area maintenance charges to reimburse us for their pro-rata portion of these costs.
Previous wording
As of September 30, 2024, our total assets were approximately $5.7 billion (after accumulated depreciation of approximately $1.5 billion) with properties located in 44 states, Ontario and Quebec, Canada. Our total investments (a non-GAAP financial measure) were approximately $6.9 billion at September 30, 2024. See "Non-GAAP Financial Measures" for the reconciliation of "Total assets" in the consolidated balance sheet to total investments at September 30, 2024 and December 31, 2023. We group our investments into two reportable segments, Experiential and Education. As of September 30, 2024, our Experiential investments comprised $6.4 billion, or 93%, and our Education investments comprised $0.5 billion, or 7%, of our total investments.
Current wording
As of March 31, 2025, our total assets were approximately $5.5 billion (after accumulated depreciation of approximately $1.6 billion) with properties located in 44 states, Ontario and Quebec, Canada. Our total investments (a non-GAAP financial measure) were approximately $6.8 billion as of March 31, 2025. See "Non-GAAP Financial Measures" for the reconciliation of "Total assets" in the consolidated balance sheet to total investments at March 31, 2025 and December 31, 2024. We group our investments into two reportable segments, Experiential and Education. As of March 31, 2025, our Experiential investments comprised $6.4 billion, or 94%, and our Education investments comprised $0.4 billion, or 6%, of our total investments.
Previous wording
As of September 30, 2024, our Experiential portfolio (excluding property under development and undeveloped land inventory) consisted of the following property types (owned or financed):
Current wording
As of March 31, 2025, our Experiential portfolio (excluding property under development, undeveloped land inventory and two joint venture properties) consisted of the following property types (owned or financed):
Previous wording
As of September 30, 2024, our owned Experiential real estate portfolio consisted of approximately 19.5 million square feet, which includes 0.4 million square feet of properties we intend to sell. The Experiential portfolio, excluding the properties we intend to sell, was 99% leased and included $76.9 million in property under development and $20.2 million in undeveloped land inventory.
Current wording
As of March 31, 2025, our wholly-owned Experiential real estate portfolio consisted of approximately 18.5 million square feet, which includes 0.3 million square feet of properties we intend to sell. The wholly-owned Experiential portfolio, excluding the properties we intend to sell, was 99% leased or operated and included $118.3 million in property under development and $20.2 million in undeveloped land inventory.
Previous wording
•60 early childhood education center properties; and
Current wording
•46 early childhood education center properties; and
Previous wording
As of September 30, 2024, our owned Education real estate portfolio consisted of approximately 1.3 million square feet, which includes 39 thousand square feet of properties we intend to sell. The Education portfolio, excluding the properties we intend to sell, was 100% leased.
Current wording
The combined wholly-owned portfolio consisted of 19.6 million square feet, which includes 0.3 million square feet of properties we intend to sell. The wholly-owned portfolio, excluding the vacant properties the Company intends to sell, was 99% leased or operated.
Previous wording
REITs are generally experiencing heightened risks and uncertainties resulting from current challenging economic conditions, including significant volatility and negative pressure in financial and capital markets, higher cost of capital, lasting impacts of high inflation and other risks and uncertainties associated with the current economic environment. Although we intend to continue making future investments, we expect our levels of investment spending to be reduced in the near-term due to elevated costs of capital, and near-term investments will be funded primarily from cash on hand, excess cash flow, disposition proceeds and borrowing availability under our unsecured revolving credit facility, subject to maintaining our leverage levels consistent with past practice. As a result, we intend to continue to be more selective in making future investments and acquisitions until such time as economic conditions improve and our cost of capital improves.
Current wording
Although we intend to continue making future investments, we expect to maintain our investment spending at moderate levels in the near-term due to an elevated cost of capital, and near-term investments will be funded primarily from cash on hand, excess cash flow, disposition proceeds and borrowing availability under our unsecured revolving credit facility, subject to maintaining our leverage levels consistent with past practice. As a result, we intend to continue to be more selective in making future investments and acquisitions until such time as economic conditions improve and our cost of capital improves.
Previous wording
Our total revenue, net income available to common shareholders per diluted share and Funds From Operations As Adjusted ("FFOAA") per diluted share (a non-GAAP financial measure) are detailed below for the three and nine months ended September 30, 2024 and 2023 (in millions, except per share information):
Current wording
Our total revenue, net income available to common shareholders per diluted share and Funds From Operations As Adjusted ("FFOAA") per diluted share (a non-GAAP financial measure) are detailed below for the three months ended March 31, 2025 and 2024 (in millions, except per share information):
Previous wording
The major factors impacting our results for the three and nine months ended September 30, 2024, as compared to the three and nine months ended September 30, 2023 were as follows:
Current wording
The major factors impacting our results for the three months ended March 31, 2025, as compared to the three months ended March 31, 2024 were as follows:
Previous wording
•The effect of property acquisitions and dispositions that occurred in 2024 and 2023;
Current wording
•The effect of investments and dispositions that occurred in 2025 and 2024;
Previous wording
•The recognition of provision for credit losses, net for the nine months ended September 30, 2024 versus the recognition of benefit for credit losses, net for nine months ended September 30, 2023; and
Current wording
•The recognition of benefit for credit losses, net for the three months ended March 31, 2025 versus the recognition of provision for credit losses, net for the three months ended March 31, 2024; and
Previous wording
•The recognition of loss on sale of real estate versus gain in sale of real estate for the three months ended September 30, 2024 versus the three months ended September 30, 2023 and the recognition of higher gain on sale of real estate for the nine months ended September 30, 2024 versus the nine months ended September 30, 2023.
Current wording
•The recognition of higher gain on sale of real estate for the three months ended March 31, 2024 versus the three months ended March 31, 2025.
Previous wording
The preparation of financial statements in conformity with accounting principles generally accepted in the United States (“GAAP”) requires management to make estimates and assumptions in certain circumstances that affect amounts reported in the accompanying consolidated financial statements and related notes. In preparing these financial statements, management has made its best estimates and assumptions that affect the reported assets and liabilities and the reported amounts of revenues and expenses during the reporting period. The most significant assumptions and estimates relate to the valuation of real estate, accounting for real estate acquisitions, assessing the collectibility of receivables and the credit loss related to mortgage and other notes receivable. Application of these assumptions requires the exercise of judgment as to future uncertainties and, as a result, actual results could differ from these estimates. A summary of critical accounting policies and estimates is included in our 2023 Annual Report. For the nine months ended September 30, 2024, there were no changes to critical accounting policies.
Current wording
The preparation of financial statements in conformity with accounting principles generally accepted in the United States (“GAAP”) requires management to make estimates and assumptions in certain circumstances that affect amounts reported in the accompanying consolidated financial statements and related notes. In preparing these financial statements, management has made its best estimates and assumptions that affect the reported assets and liabilities and the reported amounts of revenues and expenses during the reporting period. The most significant assumptions and estimates relate to the valuation of real estate, accounting for real estate acquisitions, assessing the collectability of receivables and the credit loss related to mortgage and other notes receivable. Application of these assumptions requires the exercise of judgment as to future uncertainties and, as a result, actual results could differ from these estimates. A summary of critical accounting policies and estimates is included in our 2024 Annual Report. For the three months ended March 31, 2025, there were no changes to critical accounting policies.
Previous wording
Our investment spending during the nine months ended September 30, 2024 and 2023 totaled $214.6 million and $135.5 million, respectively, and is detailed below (in thousands):
Current wording
Our investment spending during the three months ended March 31, 2025 and 2024 totaled $37.7 million and $85.7 million, respectively, and is detailed below (in thousands):
Previous wording
The above amounts include $2.3 million and $2.5 million in capitalized interest for the nine months ended September 30, 2024 and 2023, respectively, and $114 thousand and $103 thousand in capitalized other general and administrative direct project costs for the nine months ended September 30, 2024 and 2023, respectively. Excluded from the table above is approximately $5.4 million and $7.1 million of maintenance capital expenditures and other spending for the nine months ended September 30, 2024 and 2023, respectively.
Current wording
The above amounts include $1.5 million and $1.0 million in capitalized interest for the three months ended March 31, 2025 and 2024, respectively, and $39 thousand and $60 thousand in capitalized other general and administrative direct project costs for the three months ended March 31, 2025 and 2024, respectively. Excluded from the table above is approximately $1.3 million and $1.6 million of maintenance capital expenditures and other spending for the three months ended March 31, 2025 and 2024, respectively.
Previous wording
During the nine months ended September 30, 2024, we completed the sales of two cultural properties, six vacant theatre properties, one leased theatre property and one vacant early childhood education center for net proceeds totaling $65.1 million. In connection with these sales, we recognized a net gain on sale totaling $16.0 million.
Current wording
During the three months ended March 31, 2025, we completed the sales of one vacant theatre property, two operated theatre properties, one vacant early childhood education center and 10 early childhood education centers for net proceeds totaling $70.8 million. In connection with these sales, we recognized a net gain on sale totaling $9.4 million.
Previous wording
(1) For the three months ended September 30, 2024 compared to the three months ended September 30, 2023, the decrease in minimum rent resulted from a decrease of $2.7 million related to the comprehensive restructuring agreement with Regal entered into on June 27, 2023, a $16.9 million decrease in deferred rental repayments from cash basis tenants, a $1.2 million decrease from property dispositions and a $0.9 million decrease from vacant properties. This decrease was partially offset by an increase in rental revenue of $1.8 million related to property acquisitions and developments completed in 2024 and 2023 and an increase in rental revenue on existing properties of $1.6 million.
Current wording
(1) For the three months ended March 31, 2025 compared to the three months ended March 31, 2024, the increase in minimum rent resulted from an increase of $2.5 million related to property acquisitions and developments completed in 2025 and 2024. In addition, there was an increase in minimum rent of $0.6 million related to rental revenue on existing properties. This was partially offset by a decrease in rental revenue of $0.5 million from property dispositions.
Previous wording
(2) The increase in percentage rent (amounts above base rent) for the three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023 was due primarily to higher percentage rent recognized from our theatre tenants, one cultural property tenant, one attraction property tenant and our gaming tenant.
Current wording
(2) The increase in percentage rent (i.e., amounts above base rent) for the three months ended March 31, 2025 compared to the three months ended March 31, 2024 was due primarily to percentage rent recognized from one of our early childhood education center tenants.
Previous wording
(5) The increase in mortgage and other financing income during the three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023 related to interest income on new mortgage notes funded in 2024 and 2023 and from additional investments on existing mortgage note receivables.
Current wording
(3) The increase in mortgage and other financing income for the three months ended March 31, 2025 compared to the three months ended March 31, 2024 related to interest income on a new mortgage note funded in 2024 and from additional investments on existing mortgage note receivables. In addition, $1.8 million of participating interest income was recognized during the three months ended March 31, 2025, which related to amounts under review with one borrower regarding the calculation of participating interest income from prior periods that was resolved during the three months ended March 31, 2025. No participating interest income was recognized during the three months ended March 31, 2024.
Previous wording
(4) The loss on sale of real estate for the three months ended September 30, 2024 related to the sale of two theatre properties and one vacant early childhood education center. The net gain on sale of real estate for the three months ended September 30, 2023 related to the sales of two vacant theatre properties and two early childhood education centers.
Current wording
(3) The gain on sale of real estate for the three months ended March 31, 2025 related to the sale of one vacant theatre property, two operating theatre properties, one vacant early childhood education center and 10 early childhood education centers. The gain on sale of real estate for the three months ended March 31, 2024 related to the sales of two cultural properties and one vacant theatre property.
Previous wording
Cash and cash equivalents were $35.3 million at September 30, 2024. As of September 30, 2024, we had no uninsured deposits. In addition, we had restricted cash of $3.0 million at September 30, 2024, which related primarily to escrow deposits required for property management and debt agreements or held for potential acquisitions and redevelopments.
Current wording
Cash and cash equivalents were$20.6 million at March 31, 2025. In addition, we had restricted cash of$6.4 million at March 31, 2025, which related primarily to escrow deposits required for property management, mortgage note and debt agreements or held for potential acquisitions, developments and redevelopments.
Previous wording
At September 30, 2024, we had total debt outstanding of $2.9 billion, of which 99% was unsecured.
Current wording
At March 31, 2025, we had total debt outstanding of$2.8 billion, of which 99% was unsecured.
Previous wording
The Amended Credit Agreement provides for an initial maximum principal amount of borrowing availability of $1.0 billion, which includes a $100.0 million letter-of-credit subfacility and a $300.0 million foreign currency revolving credit subfacility. The new credit facility contains an "accordion" feature under which we may increase the total maximum principal amount available by $1.0 billion, to a total of $2.0 billion, subject to lender consent. The new credit facility matures on October 2, 2028. We have two options to extend the maturity date of the new credit facility by an additional six months each (for a total of 12 months), subject to paying additional fees and the absence of any default. The unsecured revolving credit facility bears interest at a floating rate of SOFR plus 1.15% (based on our unsecured debt ratings and with a SOFR floor of zero), which was 5.98% at September 30, 2024. Additionally, the facility fee on the revolving credit facility is 0.25%.
Current wording
At March 31, 2025, we had$105.0 million outstanding balance under our $1.0 billion unsecured revolving credit facility. Our unsecured revolving credit facility is governed by the terms of the Fourth Amended, Restated and Consolidated Credit Agreement (the "Amended Credit Agreement"), dated as of September 19, 2024. The facility will mature on October 2, 2028. We have two options to extend the maturity date of this credit facility by an additional six months each (for a total of 12 months), subject to paying additional fees and the absence of any default. The Amended Credit Agreement provides for an initial maximum principal amount of borrowing availability of $1.0 billion, which includes a $100.0 million letter-of-credit subfacility and a $300.0 million foreign currency revolving credit subfacility. The credit facility contains an "accordion" feature under which we may increase the total maximum principal amount available by $1.0 billion, to a total of $2.0 billion, subject to lender consent. The unsecured revolving credit facility bears interest at a floating rate of SOFR plus 1.15% (based on our unsecured debt ratings and with a SOFR floor of zero), which was 5.46% at March 31, 2025. Additionally, the facility fee on the revolving credit facility is 0.25%.
Previous wording
On August 22, 2024, we repaid our $136.6 million Series A unsecured private placement notes due 2024, using funds available on our $1.0 billion senior unsecured revolving credit facility.
Current wording
Subsequent to March 31, 2025, we fully repaid our $300.0 million senior unsecured notes due April 1, 2025, using borrowings under our $1.0 billion senior unsecured revolving credit facility.
Previous wording
At September 30, 2024, we had outstanding $179.6 million of Series B senior unsecured notes that were issued in a private placement transaction and are due on August 22, 2026. At September 30, 2024, the interest rate for these Series B private placement notes was 4.56%. The private placement notes were originally issued in two tranches: Series A due 2024; and Series B due 2026. On August 22, 2024, we repaid in full the Series A notes for $136.6 million using funds available under our $1.0 billion senior unsecured revolving credit facility.
Current wording
At March 31, 2025, we had outstanding $179.6 million of Series B senior unsecured notes that were issued in a private placement transaction and are due on August 22, 2026. At March 31, 2025, the interest rate for these Series B private placement notes was 4.56%.
Previous wording
Our unsecured revolving credit facility and the private placement notes contain financial covenants or restrictions that limit our levels of consolidated debt, secured debt, investments outside certain categories, stock repurchases and dividend distributions and require us to meet certain coverage levels for fixed charges and debt service. Additionally, these debt instruments contain cross-default provisions if we default under other indebtedness exceeding certain amounts. Those cross-default thresholds vary from $50.0 million to $75.0 million, depending upon the debt instrument. We were in compliance with all financial and other covenants under our debt instruments at September 30, 2024.
Current wording
Our unsecured revolving credit facility and the private placement notes contain financial covenants or restrictions that limit our levels of consolidated debt, secured debt, investments outside certain categories, stock repurchases and dividend distributions and require us to meet certain coverage levels for fixed charges and debt service. Additionally, these debt instruments contain cross-default provisions if we default under other indebtedness exceeding certain amounts. Those cross-default thresholds vary from $50.0 million to $75.0 million, depending upon the debt instrument. We were in compliance with all financial and other covenants under our consolidated debt instruments at March 31, 2025.
Previous wording
As of September 30, 2024, we had 13 development projects with commitments to fund an aggregate of approximately $144.1 million, of which approximately $31.1 million is expected to be funded in the remainder of 2024. Development costs are advanced by us in periodic draws. If we determine that construction is not being completed in accordance with the terms of the development agreement, we may discontinue funding construction draws. We have agreed to lease the properties to the operators at pre-determined rates upon completion of construction.
Current wording
As of March 31, 2025, wehad 14 development projects with commitments to fund an aggregate of approximately $142.8 million, of which approximately $74.2 million is expected to be funded in the remainder of 2025. Development costs are advanced by us in periodic draws. If we determine that construction is not being completed in accordance with the terms of the development agreement, we may discontinue funding construction draws. We have agreed to lease the properties to the operators at pre-determined rates upon completion of construction.
Previous wording
We have certain commitments related to our mortgage notes investments that we may be required to fund in the future. We are generally obligated to fund these commitments at the request of the borrower or upon the occurrence of events outside of our direct control. As of September 30, 2024, we had five mortgage notes with commitments totaling approximately $73.1 million, of which $20.2 million is expected to be funded in the remainder of 2024. If commitments are funded in the future, interest will be charged at rates consistent with the existing investments.
Current wording
We have certain commitments related to our mortgage notes investments that we may be required to fund in the future. We are generally obligated to fund these commitments at the request of the borrower or upon the occurrence of events outside of our direct control. As of March 31, 2025, we had two mortgage notes with commitments totaling approximately $47.4 million, of which $1.9 million is expected to be funded in the remainder of 2025. If commitments are funded in the future, interest will be charged at rates consistent with the existing investments.
Previous wording
Long-term liquidity requirements consist primarily of debt maturities. We have $300.0 million of debt maturities due April 1, 2025. We currently believe that we will be able to repay, extend, refinance or otherwise settle our debt maturities as the debt comes due and that we will be able to fund our remaining commitments, as necessary. However, there can be no assurance that additional financing or capital will be available, or that terms will be acceptable or advantageous to us, particularly in light of the challenging economic environment and our elevated cost of capital.
Current wording
Long-term liquidity requirements consist primarily of debt maturities. Subsequent to March 31, 2025, we fully repaid our $300.0 million senior unsecured notes due April 1, 2025, using borrowings under our $1.0 billion senior unsecured revolving credit facility. We have $629.6 million of debt maturities due in 2026. We currently believe that we will be able to repay, extend, refinance or otherwise settle our debt maturities as the debt comes due and that we will be able to fund our remaining commitments, as necessary. However, there can be no assurance that additional financing or capital will be available, or that terms will be acceptable or advantageous to us, particularly in light of the challenging economic environment and our elevated cost of capital.
Previous wording
Our primary use of cash after paying operating expenses, debt service, distributions to shareholders and funding existing commitments is in growing our investment portfolio through acquiring, developing and financing additional properties. We expect to finance these investments with borrowings under our unsecured revolving credit facility as well as debt and equity financing alternatives or proceeds from asset dispositions. If we borrow the maximum amount available under our unsecured revolving credit facility, there can be no assurance that we will be able to obtain additional or substitute investment financing. We may also assume mortgage debt in connection with property acquisitions. The availability and terms of any such financing or sales will depend upon market and other conditions.
Current wording
Our primary use of cash after paying operating expenses, debt service, distributions to shareholders and funding existing commitments is in growing our investment portfolio through acquiring, developing and financing additional properties. We expect to finance these investments with cash on hand, excess cash flow, proceeds from asset dispositions or borrowings under our unsecured revolving credit facility as well as debt and equity financing alternatives. If we borrow the maximum amount available under our unsecured revolving credit facility, there can be no assurance that we will be able to obtain additional or substitute investment financing. We may also assume mortgage debt in connection with property acquisitions. The availability and terms of any such financing or sales will depend upon market and other conditions.
Previous wording
The challenging economic environment has increased our cost of capital, which has negatively impacted our ability to make investments in the near-term. As a result, we intend to continue to be more selective in making investments, acquisitions, utilizing cash on hand, excess cash flow and borrowings under our line of credit until such time as economic conditions improve and our cost of capital returns to acceptable levels.
Current wording
The challenging economic environment has increased our cost of capital which has negatively impacted our ability to make investments in the near-term. Accordingly, we intend to continue to be more selective in making future investments and acquisitions until such time as economic conditions and our cost of capital improve.
Previous wording
The following table summarizes our FFO, FFOAA and AFFO including per share amounts for FFO and FFOAA, for the three and nine months ended September 30, 2024 and 2023 and reconciles such measures to net income available to common shareholders, the most directly comparable GAAP measure (unaudited, in thousands, except per share information):
Current wording
The following table summarizes our FFO, FFOAA and AFFO including per share amounts for FFO and FFOAA, for the three months ended March 31, 2025 and 2024 and reconciles such measures to net income available to common shareholders, the most directly comparable GAAP measure (unaudited, in thousands, except per share information):
Previous wording
The effect of the conversion of our convertible preferred shares is calculated using the if-converted method and the conversion, which results in the most dilution is included in the computation of per share amounts. The conversion of the 5.75% Series C cumulative convertible preferred shares and the 9.00% Series E cumulative convertible preferred shares would be dilutive to FFO, FFOAA and AFFO per share for the three and nine months ended September 30, 2024 and September 30, 2023. Therefore, the additional common shares that would result from the conversion and the corresponding add-back of the preferred dividends declared on those shares are included in the calculation of diluted FFO and FFOAA per share and would be included in a calculation of AFFO per share.
Current wording
The effect of the conversion of our convertible preferred shares is calculated using the if-converted method and the conversion, which results in the most dilution is included in the computation of per share amounts. The conversion of the 5.75% Series C cumulative convertible preferred shares and the 9.00% Series E cumulative convertible preferred shares would be dilutive to FFO, FFOAA and AFFO per share for the three months ended March 31, 2025 and 2024. Therefore, the additional common shares that would result from the conversion and the corresponding add-back of the preferred dividends declared on those shares are included in the calculation of diluted FFO and FFOAA per share and would be included in a calculation of AFFO per share.
Previous wording
Gross Assets represents total assets (reported in accordance with GAAP) adjusted to exclude accumulated depreciation and reduced for cash and cash equivalents. By excluding accumulated depreciation and reducing cash and cash equivalents, the result provides an estimate of the investment made by us. We believe that investors commonly use versions of this calculation in a similar manner. Our method of calculating Gross Assets may be different from methods used by other REITs and, accordingly, may not be comparable to such other REITs.
Current wording
Gross Assets represents total assets (reported in accordance with GAAP) adjusted to exclude accumulated depreciation and reduced by cash and cash equivalents. By excluding accumulated depreciation and reducing cash and cash equivalents, the result provides an estimate of the investment made by us. We believe that investors commonly use versions of this calculation in a similar manner. Our method of calculating Gross Assets may be different from methods used by other REITs and, accordingly, may not be comparable to such other REITs.
Previous wording
Reconciliations of debt, total assets and net income (all reported in accordance with GAAP) to Net Debt, Gross Assets, Net Debt to Gross Assets Ratio, EBITDAre, Adjusted EBITDAre and Net Debt to Adjusted EBITDAre Ratio (each of which is a non-GAAP financial measure), as applicable, are included in the following tables (unaudited, in thousands):
Current wording
Reconciliations of debt, total assets and net income (all reported in accordance with GAAP) to Net Debt, Gross Assets, Net Debt to Gross Assets Ratio, EBITDAre, Adjusted EBITDAre and Net Debt to Adjusted EBITDAre Ratio (each of which is a non-GAAP financial measure), as applicable, are included in the following tables (unaudited, in thousands except ratios):
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
As of March 31, 2025, our wholly-owned Education real estate portfolio consisted of approximately 1.1 million square feet and was 100% leased.
Current report — wording carried from elsewhere
Three months ended March 31, 2025 compared to the three months ended March 31, 2024