EPR PROPERTIES

Contents

Report of Independent Registered Public Accounting Firm

To the Board of Trustees and Shareholders

EPR Properties:

Opinions on the Consolidated Financial Statements and Internal Control Over Financial Reporting

We have audited the accompanying consolidated balance sheets of EPR Properties and subsidiaries (the Company) as of December 31, 2025 and 2024, the related consolidated statements of income and comprehensive income, changes in equity, and cash flows for each of the years in the three-year period ended December 31, 2025, and the related notes and financial statement schedule III (collectively, the consolidated financial statements). We also have audited the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2025, in conformity with U.S. generally accepted accounting principles. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025 based on criteria established in Internal Control –Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Basis for Opinions

The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s consolidated financial statements and an opinion on the Company’s internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

Definition and Limitations of Internal Control Over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing separate opinions on the critical audit matter or on the accounts or disclosures to which they relate.

Evaluation of indicators real estate investments may not be recoverable

As discussed in Notes 2 and 3 to the consolidated financial statements, the real estate investments, net balance as of December 31, 2025 was $4,494,259 thousand. The Company reviews a real estate investment for impairment whenever events or changes in circumstances indicate that the carrying value of the real estate investment may not be recoverable.

We identified the evaluation of indicators real estate investments may not be recoverable as a critical audit matter. There is a high degree of subjective judgement in evaluating the events or changes in circumstances that may indicate the carrying value of real estate investments may not be recoverable. In particular, the judgments regarding the expected period the Company will hold the real estate investments on the determination of the recoverability of the real estate investments required a higher degree of auditor judgment.

The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of an internal control related to the critical audit matter. This control related to the Company’s process to identify and evaluate events or changes in circumstances that may indicate the carrying amount of real estate investments may not be recoverable, which includes determining the period the Company will hold the real estate investments. We inquired of Company officials and inspected documents such as meeting minutes of the Board of Trustees to evaluate the likelihood that a real estate investment would be sold prior to the estimated holding period.

/s/KPMG LLP

We have served as the Company’s auditor since 2002.

Chicago, Illinois

February 26, 2026

Consolidated Balance Sheets

(Dollars in thousands except share data)

Consolidated Statements of Income and Comprehensive Income

(Dollars in thousands except per share data)

1. Organization

Description of Business

EPR Properties (the Company) was formed on August 22, 1997 as a Maryland real estate investment trust (REIT), and an initial public offering of the Company's common shares of beneficial interest (common shares) was completed on November 18, 1997. Since that time, the Company has been a leading diversified experiential net lease REIT specializing in select enduring experiential properties. The Company's underwriting is centered on key industry and property cash flow criteria, as well as the credit metrics of the Company's tenants and customers. The Company’s properties are located in the United States (U.S.) and Canada.

2. Summary of Significant Accounting Policies

Principles of Consolidation

The consolidated financial statements include the accounts of EPR Properties and its subsidiaries, all of which are wholly owned.

Variable Interest Entities

The Company consolidates certain entities when it is deemed to be the primary beneficiary in a variable interest entity (VIE) in which it has a controlling financial interest in accordance with the consolidation guidance of the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC). The equity method of accounting is applied to joint ventures and other similar entities in which the Company is not the primary beneficiary as defined in the FASB ASC Topic on Consolidation (Topic 810), but can exercise influence over the entity with respect to its operations and major decisions.

The Company’s variable interest in VIEs currently are in the form of equity investments and loans provided by the Company to a VIE. The Company examines specific criteria and uses its judgment when determining if the Company is the primary beneficiary of a VIE. The primary beneficiary generally is defined as the party with the controlling financial interest. Consideration of various factors include, but are not limited to, the Company’s ability to direct the activities that most significantly impact the entity’s economic performance and its obligation to absorb losses from or right to receive benefits of the VIE that could potentially be significant to the VIE. As of December 31, 2025 and 2024, the Company does not have any investments in consolidated VIEs.

Use of Estimates

Management of the Company has made estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities to prepare these consolidated financial statements in conformity with U.S. generally accepted accounting principles (GAAP). Actual results could differ from those estimates.

Real Estate Investments

Real estate investments are carried at initial recorded value less accumulated depreciation. Costs incurred for asset acquisitions and development of properties are capitalized. In addition, the Company capitalizes certain costs that relate to property under development including interest. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, which generally are estimated to be 30 years to 40 years for buildings, three years to 25 years for furniture, fixtures and equipment and 10 years to 20 years for site improvements. Tenant improvements, including allowances, are depreciated over the shorter of the lease term or the estimated useful life and leasehold interests are depreciated over the useful life of the underlying lease.

Management reviews the Company's real estate investments, including operating lease right-of-use assets, for impairment whenever events or changes in circumstances indicate that the carrying value of a property may not be recoverable, which is based on an estimate of undiscounted future cash flows expected to result from the property and its eventual disposition. If impairment exists due to the inability to recover the carrying value of the property, an impairment loss is recorded to the extent that the carrying value of the property exceeds its estimated fair value.

The Company evaluates the held-for-sale classification of its real estate as of the end of each quarter. Assets that are classified as held for sale are recorded at the lower of their carrying amount or fair value less costs to sell. Assets are generally classified as held for sale once a sales contract is executed with no contingencies and the prospective buyer has significant funds at risk to ensure performance.

Real Estate Acquisitions

Upon acquisition of real estate properties, the Company evaluates the acquisition to determine if it is a business combination or an asset acquisition. If the acquisition is determined to be an asset acquisition, the Company capitalizes the purchase price and other related costs, including transaction costs, and allocates this to the acquired tangible assets and identified intangible assets and liabilities on a relative fair value basis.

If the acquisition is determined to be a business combination, the Company records the fair value of acquired tangible assets and identified intangible assets and liabilities as well as any noncontrolling interest, if applicable. Acquisition-related costs in connection with business combinations, as well as costs associated with terminated transactions and certain pre-opening and tenant transition costs, are expensed as incurred and included in "Transaction costs" in the accompanying consolidated statements of income and comprehensive income.

For real estate acquisitions (asset acquisitions or business combinations), the fair value (or relative fair value in an asset acquisition) of the tangible assets is determined by valuing the property using recent independent appraisals. Land is valued using the sales comparison approach, which uses available market data from recent comparable land sales as an input to estimate the fair value. Site improvements and tenant improvements are valued using the cost approach, which uses replacement cost data obtained from industry recognized guides less depreciation as an input to estimate the fair value. The building is valued either using the cost approach described above or a combination of the cost and the income approach. The income approach uses market leasing assumptions to estimate the fair value of the property as if vacant. The cost and income approaches are reconciled to arrive at an estimated building fair value.

Intangibles

The fair value of acquired in-place leases also includes management’s estimate, on a lease-by-lease basis, of the present value of the following amounts: (i) the value associated with avoiding the cost of originating the acquired in-place leases (i.e. the market cost to execute the leases, including leasing commissions, legal and other related costs); (ii) the value associated with lost revenue related to tenant reimbursable operating costs estimated to be incurred during the assumed re-leasing period, (i.e. real estate taxes, insurance and other operating expenses); (iii) the value associated with lost rental revenue from existing leases during the assumed re-leasing period; and (iv) the value associated with avoided tenant improvement costs or other inducements to secure a tenant lease. These values are amortized over the lease term of the respective leases.

In determining the fair value of acquired above and below-market leases, the Company considers many factors. On a lease-by-lease basis, management considers the present value of the difference between the contractual amounts to be paid pursuant to the leases and management’s estimate of fair market lease rates. For above-market leases and below-market leases, management considers such differences over the lease terms. The capitalized above-market lease values are amortized as a reduction of rental income over the lease terms of the respective leases. The capitalized below-market lease values are amortized as an increase to rental income over the lease terms of the respective leases. The lease term includes the minimum base term plus any extension options that are reasonably certain to be exercised. Management considers several factors in determining the discount rate used in the present value calculations, including the credit risks associated with the respective tenants.

If debt is assumed in the acquisition, the determination of whether it is above or below-market is based upon a comparison of similar financing terms for similar real estate investments at the time of the acquisition.

In determining the fair value of tradenames, the Company historically uses the relief from royalty method, which estimates the fair value of hypothetical royalty income that could be generated if the intangible asset was licensed from an independent third-party.

In determining the fair value of a contract intangible, the Company considers the present value of the difference between the estimated "with" and "without" scenarios. The "with" scenario presents the contract in place and the "without" scenario incorporates the potential profits that may be lost over the period without the contract in place. The capitalized contract value is amortized over the estimated useful life of the underlying asset.

The excess of the cost of an acquired business (in a business combination) over the net of the amounts assigned to assets acquired (including identified intangible assets) and liabilities assumed is recorded as goodwill. Goodwill has an indefinite life and is not amortized, but is tested for impairment on an annual basis, or more frequently if events or changes in circumstances indicate that the asset might be impaired.

Management of the Company reviews the carrying value of intangible assets for impairment on an annual basis.

Intangible assets and liabilities (included in "Other assets" and "Accounts payable and accrued liabilities" in the accompanying consolidated balance sheets) consist of the following at December 31 (in thousands):

(1) At December 31, 2025 and 2024, $5.4 million in tradenames had indefinite lives and were not amortized.

Aggregate intangible amortization included in expense was $2.2 million for both the years ended December 31, 2025 and 2024 and $7.1 million for the year ended December 31, 2023. The net amount amortized as an increase to rental revenue for capitalized above and below-market lease intangibles was $0.4 million for both the years ended December 31, 2025 and 2024 and$0.5 million for the year ended December 31, 2023.

Future amortization of intangible assets and liabilities without indefinite lives at December 31, 2025 is as follows (in thousands):

Deferred Financing Costs

Deferred financing costs are amortized over the terms of the related debt obligations or mortgage note receivable as applicable. Deferred financing costs of$25.2 million and $19.1 million as of December 31, 2025 and 2024, respectively, are shown as a reduction of "Debt" in the accompanying consolidated balance sheets. The deferred financing costs related to the unsecured revolving credit facility of$7.7 million and $10.5 million as of December 31, 2025 and 2024, respectively, are included in "Other assets" in the accompanying consolidated balance sheets.

Reportable Segments

The Company hastwo reportable operating segments: Experiential and Education. The Experiential segment includes the following property types: theatres, eat & play (including seven theatres located in entertainment districts), attractions, ski, experiential lodging, gaming, cultural and fitness & wellness. The Education segment includes the following property types: early childhood education centers and private schools. The Company’s business is focused on Experiential real estate. The economic characteristics of the property types in the Experiential and Education segments are similar across type, geographic location and industries in which our tenants and borrowers operate. The Company’s segment structure reflects the financial information and reports used by the Company’s management team, specifically its chief operating decision maker (CODM), to make decisions regarding the Company’s business, including resource allocation and performance assessments. The Company’s CODM is its Chairman, President and Chief Executive Officer.

While the Company does not plan to seek additional opportunities in the Education segment, information provided to the CODM is separated and decisions are made based on thesetwo operating segments. The CODM uses segment assets as reported on the balance sheet as Total Assets and Net Operating Income (NOI) before unallocated items to assess and allocate resources. NOI is calculated as total revenue (consisting of rental revenue, other income and mortgage and other financing income) less property operating expense and other expense. Revenue from both segments is derived substantially from investments structured as long-term triple-net leases or mortgages. Corporate items are not allocated to segments. See Note 17 for financial information related to these reportable segments.

Rental Revenue

The Company leases real estate to its tenants under leases classified as operating leases. The Company's leases generally provide for rent escalations throughout the lease terms. Rents that are fixed are recognized on a straight-line basis over the lease term. Base rent escalations that include a variable component are recognized upon the occurrence of the specified event as defined in the Company's lease agreements. Many of the Company's leasing arrangements include options to extend the lease, which are not included in the minimum lease terms unless the option is reasonably certain to be exercised. Straight-line rental revenue is subject to an evaluation for collectability, and the Company records a direct write-off against rental revenue if collectability of these future rents is not probable. The Company recognized straight-line write-offs of$0.1 million for both the years ended December 31, 2025 and 2024 and $0.7 million for the year ended December 31, 2023. Straight-line rental revenue, net of write- offs, was$16.1 million, $17.3 million and $10.6 million, for the years ended December 31, 2025, 2024 and 2023, respectively.

Most of the Company’s lease contracts are triple-net leases, which require the tenants to make payments directly to third parties for lessor costs (such as property taxes and insurance) associated with the properties. In accordance with FASB ASC Topic 842, the Company does not include these lessee payments made to third parties in rental revenue or property operating expenses. In certain situations, the Company pays these lessor costs directly to third parties and the tenants reimburse the Company. In accordance with Topic 842, these payments are presented on a gross basis in rental revenue and property operating expense. The Company recognized $2.1 million, $2.0 million and $1.7 million for the years ended December 31, 2025, 2024 and 2023, respectively, in tenant reimbursements related to the gross-up of these reimbursed expenses, which are included in rental revenue.

Certain of the Company's leases, particularly at its entertainment districts, require the tenants to make payments to the Company for property related expenses such as common area maintenance. In accordance with Topic 842, the Company has elected to combine these non-lease components with the lease components in rental revenue. For the years ended December 31, 2025, 2024 and 2023, the amounts due for non-lease components included in rental revenue totaled$19.3 million, $18.8 million and $19.6 million, respectively.

In addition, most of the Company's tenants are subject to additional rents (above base rents) if gross revenues of the properties exceed certain thresholds defined in the lease agreements (percentage rents). Percentage rents are recognized at the time when specific triggering events occur as provided by the lease agreement. Rental revenue included percentage rents of $22.1 million,$14.5 million and $12.2 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Rental revenue included lease termination fees of approximately $3.4 million for the year ended December 31, 2023, relating to the early terminations oftwo leases bytwo tenants. No lease termination fees were received for the years ended December 31, 2025 and 2024.

The Company regularly evaluates the collectability of its receivables on a lease-by-lease basis. The evaluation primarily consists of reviewing past due account balances and considering such factors as the credit quality, projected performance and historical trends of the tenant, as well as the current economic conditions and changes in customer payment terms. When the collectability of lease receivables or future lease payments are no longer probable, the Company records a direct write-off of the outstanding receivable to rental revenue and recognizes future rental revenue on a cash basis.

Property Sales

The Company recognizes a sale of real estate properties when a contract exists and the purchaser has obtained control of the property. Gains on sales of properties are recognized in full in a partial sale of nonfinancial assets, to the extent control is not retained. Any noncontrolling interest retained by the Company would, accordingly, be measured at fair value.

The Company evaluates each sale or disposal transaction to determine if it meets the criteria to qualify as discontinued operations. A discontinued operation is a component of an entity or group of components that have been disposed of or are classified as held for sale and represent a strategic shift that has or will have a major effect on the Company's operations and financial results. If the sale or disposal transaction does not meet the criteria, the operations and related gain or loss on sale is included in income from continuing operations.

Mortgage Notes and Other Notes Receivable

Mortgage notes and other notes receivable, including related accrued interest receivable, consist of loans originated by the Company and the related accrued and unpaid interest income as of the balance sheet date. Mortgage notes and other notes receivable are initially recorded at the amount advanced to the borrower less allowance for credit loss. Interest income is recognized using the effective interest method over the estimated life of the note. Interest income includes both the stated interest and the amortization or accretion of premiums or discounts (if any).

The Company made an accounting policy election to not measure an allowance for credit losses for accrued interest receivables related to its mortgage notes and notes receivable. Accordingly, if accrued interest receivable is deemed to be uncollectible, the Company will record any necessary write-offs as a reversal of interest income. During the year ended December 31, 2025, the Company wrote off approximately $0.1 million of accrued interest and fees receivable against interest income related toone mortgage note receivable. No such amounts were written-off for the years ended December 31, 2024 and 2023. As of December 31, 2025, the Company believes that all outstanding accrued interest is collectible.

In the event the Company has a past due mortgage note or note receivable that the Company determines is collateral-dependent, the Company measures expected credit losses based on the fair value of the collateral with the credit allowance being the difference between the outstanding principal balance of the notes and the estimated fair value. As of December 31, 2025, the Company does not have any mortgage notes or notes receivable with past due principal balances. See Note 7 for further discussion of mortgage notes and notes receivable for which the Company elected to apply the collateral dependent practical expedient.

Mortgage and Other Financing Income

Certain of the Company's borrowers are subject to additional interest based on certain thresholds defined in the mortgage agreements (participating interest). Participating interest income is recognized at the time when specific triggering events occur as provided by the mortgage agreement. Participating interest income for the years ended December 31, 2025, 2024 and 2023 was $2.5 million, $197 thousand and $57 thousand, respectively.

Income Taxes

The Company has elected to be taxed as a REIT pursuant to Section 856(c) of the Internal Revenue Code. A REIT that distributes at least 90% of its taxable income to its shareholders each year and meets certain other conditions is not taxed on that portion of its taxable income which is distributed to its shareholders. The Company intends to continue to qualify as a REIT and distribute substantially all of its taxable income to its shareholders. The Company adopted FASB Accounting Standards Update (ASU) No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures for the year ended December 31, 2025 on a prospective basis. The ASU enhances annual income tax disclosures by requiring entities to disclose specific categories in the rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold. In addition, the ASU requires annual disclosure of income taxes paid disaggregated by jurisdiction. The impact of the ASU is on disclosure only and the related disclosures are included below.

The Company is subject to income tax in certain instances in both the U.S. and in certain foreign jurisdictions, as more fully described herein. The Company’s income tax expense includes deferred income tax expense or benefit, which represents the change in net deferred tax assets and liabilities. Deferred tax assets and liabilities are determined based on the difference between the financial statement and tax basis of assets and liabilities as measured by the enacted tax rates that will be in effect when these differences reverse. The Company evaluates the realizability of its deferred income tax assets and assesses the need for a valuation allowance for each jurisdiction for which it is subject to income tax. The realization of the deferred tax assets depends upon all positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit the use of existing deferred tax assets.

The Company owns certain real estate assets that are subject to income tax in Canada. At December 31, 2025, the net deferred tax assets related to the Company's Canadian operations totaled $13.0 million (consisting of $26.6 million of deferred tax assets and $13.6 million of deferred tax liabilities) resulting from the temporary differences between income for financial reporting purposes and taxable income relating primarily to depreciation, capital improvements and straight-line rents. At December 31, 2025, it is more likely than not the Company will not generate sufficient taxable income to realize any of the $26.6 million of deferred tax assets resulting in a net deferred tax liability of $13.6 million.

The Company has certain taxable REIT subsidiaries (TRSs), as permitted under the Internal Revenue Code, through which it conducts certain business activities and are subject to federal and state income taxes on their net taxable income. At December 31, 2025, the deferred tax assets related to the Company's TRSs totaled $12.1 million, resulting from the temporary differences between income for financial reporting purposes and taxable income relate primarily to net operating loss carryovers and pre-opening cost amortization. At December 31, 2025, it is more likely than not that the Company will not generate sufficient taxable income to realize any of these deferred tax assets.

The Company’s consolidated deferred tax position is summarized as follows at December 31 (in thousands):

During the years ended December 31, 2025, 2024 and 2023, the Company recognized current income and withholding tax expense of $3.6 million, $3.0 million and $2.1 million, respectively, primarily related to certain state income taxes and foreign income and withholding tax. The table below details the current and deferred income tax expense (benefit) for the years ended December 31, 2025, 2024 and 2023 (in thousands):

The Company qualified as a REIT and distributed the necessary amount of taxable income such thatno current U.S. federal income taxes were due for the years ended December 31, 2025, 2024 and 2023. Accordingly, no provision for current U.S. federal income taxes was recorded for any of those years. If the Company fails to qualify as a REIT in any taxable year, without the benefit of certain provisions, it will be subject to federal and certain state income taxes at regular corporate rates (including any applicable alternative minimum tax for years prior to January 1, 2022) and may not be able to qualify as a REIT for four subsequent taxable years. Even if the Company qualifies for taxation as a REIT, the Company is subject to certain foreign, state and local taxes on its income and property, and federal income and excise taxes on its undistributed taxable income. Tax years 2022 through 2024 remain generally open to examination for U.S. federal income tax and state tax purposes and from 2021 through 2024 for Canadian income tax purposes.

The Company's effective tax rate for the years ended December 31, 2025, 2024 and 2023 was 1.0%,1.2% and 1.2%, respectively. The differences between the income tax expense calculated at the statutory U.S. federal income tax rates and the actual income tax expense recorded is mostly attributable to the dividends paid deduction available for

REITs. The table below details the components of income tax expense for the year ended December 31, 2025 (dollars in thousands):

(1) The significant negative adjustment represents GAAP income attributable to the Company's status as a REIT. The Company is generally not subject to U.S. federal income tax on REIT income that is distributed to its shareholders as dividends. As the Company has satisfied all applicable REIT requirements, its REIT income is not subject to corporate level tax.

(2) Primarily changes in the valuation allowance at the Company's taxable REIT subsidiaries (TRSs).

The table below details income taxes paid in cash, net of refunds for the year ended December 31, 2025 (in thousands):

The Company’s policy is to recognize interest and penalties as general and administrative expense. The Company did not recognize any interest and penalties in 2025, 2024 or 2023. The Company did not have any accrued interest and penalties at December 31, 2025, 2024 and 2023. Additionally, the Company did not have any unrecorded tax benefits as of December 31, 2025, 2024 and 2023.

Concentrations of Risk

Topgolf USA (Topgolf), American-Multi Cinema, Inc. (AMC) and Regal Cinemas (Regal) represented a significant portion of the Company's total revenue for the years ended December 31, 2025, 2024 and 2023. The Company had higher revenue from Regal during the year ended December 31, 2023 due to the payment of higher base rent (pre-bankruptcy) and the repayment of deferred rent due, both of which were recognized as rental revenue when received. The following is a summary of the Company's total revenue derived from rental or interest payments from Topgolf, AMC and Regal (dollars in thousands):

Cash Equivalents

Cash equivalents include bank demand deposits and other short-term investments.

Restricted Cash

Restricted cash represents cash held for escrow deposits required in connection with property management and debt agreements or held for potential acquisitions and redevelopments.

Share-Based Compensation

Share-based compensation to associates of the Company is granted pursuant to the Company's Annual Incentive Program and Long-Term Incentive Plan and share-based compensation to non-associate Trustees of the Company is granted pursuant to the Company's Trustee compensation program.

Share-based compensation expense consists of amortization of nonvested share grants and performance share units issued to associates along with restricted share units issued to non-associate Trustees. Share-based compensation is included in "General and administrative expense" in the accompanying consolidated statements of income and comprehensive income.

Nonvested Shares Issued to Associates

The Company grants nonvested shares to associates pursuant to both the Annual Incentive Program and the Long-Term Incentive Plan. The Company amortizes the expense related to the nonvested shares awarded to associates under the Long-Term Incentive Plan and the premium awarded under the nonvested share alternative of the Annual Incentive Program on a straight-line basis over the future vesting period ofthree years tofour years.

Nonvested Performance Share Units Issued to Associates

The Company awards performance share units to the Company's executive officers pursuant to the Long-Term Incentive Plan. The performance share units contain both a market condition and a performance condition. The Company amortizes the expense related to the performance share units over the future vesting period ofthree years.

Restricted Share Units Issued to Non-Associate Trustees

The Company issues restricted share units to non-associate Trustees for payment of their annual retainers under the Company's Trustee compensation program. The settlement date for the shares is selected by the non-associate Trustee, and ranges from one year from the grant date to upon termination of service. This expense is amortized by the Company on a straight-line basis over the one-year vesting period.

Foreign Currency Translation

The functional currency of the Company's entities that own properties located in Canada is the Canadian dollar (CAD). The assets and liabilities for these entities are translated into U.S. dollars (USD) using the spot rate at the respective balance sheet date and revenues and expenses are translated using the monthly average exchange rate. Resulting translation adjustments are recorded as a separate component of comprehensive income.

The functional currency of the Company's entity that holds a mortgage secured by property located in Canada is the USD. This entity's financial assets and liabilities denominated in currencies other than the USD are recorded at the exchange rate at the time of the transaction and subsequent gains or losses related to changes in the foreign currency are included in "Other income" or "Other expense," as applicable, in the accompanying consolidated statements of income and comprehensive income.

Derivative Instruments

The Company uses derivative instruments to reduce exposure to fluctuations in foreign currency exchange rates and variable interest rates.

The Company records all derivatives on the balance sheet at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether the Company has elected to designate a derivative in a hedging relationship and apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to changes in the fair value of an asset, liability, or firm commitment attributable to a particular risk, such as foreign currency risk, are considered fair value hedges. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows are considered cash flow hedges. Hedge accounting generally provides for the matching of the timing of gain or loss recognition on the hedging instrument with the recognition of the changes in the fair value hedge or the earnings effect of the hedged forecasted transactions in a cash flow hedge. The Company may enter into derivative contracts that are intended to economically hedge certain of its risk, even though hedge accounting does not apply or the Company elects not to apply hedge accounting. If hedge accounting is not applied, realized and unrealized gains or losses are reported in earnings.

The Company's policy is to measure the credit risk of its derivative financial instruments that are subject to master netting agreements on a net basis by counterparty portfolio.

Impact of Recently Issued Accounting Standards

In November 2024, the FASB issued ASU No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 22-40): Disaggregation of Income Statement Expenses. The ASU requires entities to provide enhanced disclosures related to certain costs and expenses in the notes to the financial statements. The guidance is effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the impact this guidance will have on the Company's financial statements and related disclosures.

3. Real Estate Investments

The following table summarizes the carrying amounts of real estate investments as of December 31, 2025 and 2024 (in thousands):

Depreciation expense on real estate investments was$165.4 million, $161.9 million and $159.3 million for the years ended December 31, 2025, 2024 and 2023, respectively.

4. Investments and Dispositions

Acquisitions and Development

The Company's investment spending during the year ended December 31, 2025, totaled $288.5 million, and included the following:

•$14.3 million for an acquisition of an attraction property in New Jersey;

•$1.2 million for the acquisition of land and $5.9 million in mortgage financing secured by the improvements on acquired land of a fitness & wellness property in Georgia;

•$20.0 million for mortgage financing secured by a fitness & wellness property in Winnipeg, Canada;

•$90.7 million for the acquisition offive golf course properties in Texas;

•$23.2 million for an acquisition of an attraction property in Virginia; and

•spending on experiential build-to-suit development and redevelopment projects.

The Company's investment spending during the year ended December 31, 2024 totaled $263.9 million, and included the following:

•$52.0 million for mortgage financing secured by a fitness & wellness property in Colorado;

•$33.4 million for the acquisition of an attraction property in New York;

•$19.9 million for the acquisition of land forthree build-to-suit eat & play developments in Illinois, Kansas and Oklahoma; and

•spending on experiential build-to-suit development and redevelopment projects.

During the year ended December 31, 2025, the Company completed the sale ofthree vacant theatre properties, two operating theatre properties, four leased theatre properties, one vacant early childhood education center, four land parcels and 10 leased early childhood education centers for net proceeds totaling $141.8 million and recognized a net gain on sale totaling $36.1 million.

During the year ended December 31, 2024, the Company completed the sale oftwo leased cultural properties, eight vacant theatre properties, one leased theatre property andtwo vacant early childhood education centers for net proceeds totaling $74.4 million and recognized a net gain on sale totaling $16.1 million.

During the year ended December 31, 2023, the Company completed the sale ofthree vacant theatre properties, two leased theatre properties, one vacant eat & play property, four vacant early childhood education centers andthree land parcels for net proceeds totaling $57.2 million and recognized a net loss on sale of $2.2 million. Additionally, during the year ended December 31, 2023, the Company, as lessee, terminatedone ground lease that heldone theatre property.

Dispositions during the years ended December 31, 2025, 2024 and 2023 did not meet the criteria for discontinued operations reporting.

5. Impairment Charges

The Company reviews its properties for changes in circumstances that indicate that the carrying value of a property may not be recoverable based on an estimate of undiscounted future cash flows. No impairment charges were recognized during the year ended December 31, 2025.

During the year ended December 31, 2024, the Company reassessed the holding period ofone vacant theatre property, two theatre properties currently operated through a third-party management agreement andtwo leased theatre properties. The Company determined that the sum of the undiscounted cash flows did not exceed the carrying value of the theatre properties and estimated the fair value of the real estate investments using independent appraisals and purchase offers. During the year ended December 31, 2024, the Company reduced the carrying value of the real estate investments, net to $45.9 million and recognized an impairment charge of $51.8 million on real estate investments, which is the amount that the carrying values of the assets exceeded the estimated fair values.

During the year ended December 31, 2024, the Company also recognized $28.2 million of other-than-temporary impairment charges related to its equity investments intwo unconsolidated real estate joint ventures that owntwo experiential lodging properties located in St. Pete Beach, Florida andtwo unconsolidated real estate joint ventures that own an experiential lodging property in Breaux Bridge, Louisiana.

During the year ended December 31, 2023, the Company reassessed the holding period of 16 theatre properties surrendered by Regal as part of its bankruptcy resolution and not included in the Company's new master lease with Regal, four other theatre properties that were part of a workout with a smaller theatre tenant andtwo early childhood education center properties subject to lease terminations (one of which was triggered by a casualty event). The Company determined that the estimated cash flows foreight of the Regal surrendered properties, two of the other theatre properties and both of the early childhood education center properties were not sufficient to recover the carrying values and estimated the fair value of the real estate investments of these properties using independent appraisals. During the year ended December 31, 2023, the Company reduced the carrying value of the real estate investments, net to $39.2 million and recognized impairment charges of $67.4 million on real estate investments, which is the amount that the carrying values of the assets exceeded the estimated fair values.

6. Accounts Receivable

The following table summarizes the carrying amounts of accounts receivable as of December 31, 2025 and 2024 (in thousands):

(1) Receivable from non-tenants at December 31, 2024 includes a $5.9 million payment to the City of Kansas City, Missouri (the City) that was made under protest related to an assessment of tax years ending December 31, 2018 through 2022. The payment was made during the year ended December 31, 2024 and included the City's assessment of additional tax, penalties and interest. The City denied the Company’s necessary deduction for dividends paid for each of these years. During the year ended December 31, 2025, the Company and the City agreed to an alternative methodology for apportionment of taxes and as a result, the Company recognized $0.3 million of expense related to these prior periods and received a refund of $5.6 million from the City.

7. Investment in Mortgage Notes and Notes Receivable

The Company measures expected credit losses on its mortgage notes and notes receivable on an individual basis because its financial instruments do not have similar risk characteristics. The Company uses a forward-looking commercial real estate loss forecasting tool to estimate its current expected credit losses (CECL) for each of its mortgage notes and notes receivable on a loan-by-loan basis. As of December 31, 2025, the Company did notanticipate any prepayments. Ther efore, the contractual terms of its mortgage notes and notes receivable were used for the calculation of the expected credit losses. The Company updates the model inputs at each reporting period to reflect, if applicable, any newly originated loans, changes to specific loan information on existing loans and current macroeconomic conditions. The CECL allowance is a valuation account that is deducted from the related mortgage note or note receivable.

Certain of the Company’s mortgage notes and notes receivable include commitments to fund future incremental amounts to its borrowers. These future funding commitments are also subject to the CECL model. The CECL allowance related to future funding is recorded as a liability and is included in "Accounts payable and accrued liabilities" in the accompanying consolidated balance sheets.

Investment in mortgage notes, including related accrued interest receivable, at December 31, 2025 and 2024 consists of the following (in thousands):

(1) During the year ended December 31, 2025, the Company received $18.4 million in net proceeds representing partial prepayment onone mortgage note receivable relating to the sale ofone of thefive fitness & wellness properties that secures the note.

(2) During the year ended December 31, 2024, the Company decided to exit its unconsolidated equity investment in an operating RV property located in Breaux Bridge, Louisiana. The Company had previously provided an $11.3 million subordinated mortgage note receivable to the unconsolidated real estate joint venture holding the property. During the year ended December 31, 2024, the Company recorded an allowance for credit loss totaling $10.3 million for this mortgage note receivable. On February 4, 2025, the Company received $1.0 million in exchange for the sale of its remaining subordinated mortgage note receivable and, accordingly, reduced the allowance for credit loss by the $10.3 million of principal that was forgiven.

(3) During the year ended December 31, 2025, the Company received $8.1 million in net proceeds representing prepayment in full ontwo mortgage note receivables that were secured bytwo early childhood education center properties in Florida.

At December 31, 2025, two of the Company's mortgage notes receivable are considered collateral-dependent and expected credit losses are based on the fair value of the underlying collateral with the credit allowance being the difference between the outstanding principal balance of the notes and the estimated fair value at the reporting date. The Company assessed the fair value of the collateral as of December 31, 2025 on the mortgage notes receivable. During the year ended December 31, 2025, the Company recorded an allowance for credit loss totaling $6.4 million forone of these mortgage notes, which represents the outstanding principal balance of the note as of December 31, 2025. The other collateral-dependent mortgage note receivable has a carrying amount at December 31, 2025 of approximately $10.4 million net of an allowance for credit loss totaling $0.4 million. Income from these borrowers is recognized on a cash basis. During the years ended December 31, 2025 and 2024, the Company received cash basis interest payments of $1.2 millionand $1.1 million, respectively, from these mortgage note receivable borrowers.

Investment in notes receivable, including related accrued interest receivable, was$2.7 million and $3.3 million at December 31, 2025 and 2024, respectively, and is included in "Other assets" in the accompanying consolidated balance sheets.

At December 31, 2025, one of the Company's notes receivable is considered collateral-dependent. The Company assessed the fair value of the collateral as of December 31, 2025 on the note receivable. The note receivable is fully reserved with an allowance for credit loss totaling $6.0 million, which represents the outstanding principal balance of the note as of December 31, 2025. At December 31, 2025, the Company's investment in this note receivable was a variable interest investment and the underlying entity is a VIE. The Company is not the primary beneficiary of this VIE because the Company does not individually have the power to direct the activities that are most significant to the entity and, accordingly, this investment is not consolidated. The Company's maximum exposure to loss associated with this VIE is limited to the Company's outstanding note receivable in the amount of $6.0 million, which is fully reserved in the allowance for credit losses at December 31, 2025. The Company's income received from this borrower is recognized on a cash basis. During the years ended December 31, 2025 and 2024, the Company received cash basis interest payments of $0.6 million and $0.7 million, respectively, from this borrower. During the years ended December 31, 2025 and 2024, the Company received principal payments totaling $0.8 million for each period from this borrower. Additionally, during the year ended December 31, 2025, the Company wrote-off $1.9 million of principal for a note receivable that was fully reserved.

The following summarizes the activity within the allowance for credit losses related to mortgage notes, unfunded commitments and notes receivable for the years ended December 31, 2025 and 2024 (in thousands):

8. Debt

Debt at December 31, 2025 and 2024 consists of the following (in thousands):

(1) Upon maturity, on April 1, 2025, the Company repaid in full $300.0 million of senior unsecured notes using borrowings under its $1.0 billion senior unsecured revolving credit facility.

(2) The amended Note Purchase Agreement, which governs the private placement notes, contains certain financial and other covenants that generally conform to the Company's unsecured revolving credit facility.

(3) These notes contain various covenants, including: (i) a limitation on incurrence of any debt that would cause the ratio of the Company’s debt to adjusted total assets to exceed 60%; (ii) a limitation on incurrence of any secured debt that would cause the ratio of the Company’s secured debt to adjusted total assets to exceed 40%; (iii) a limitation on incurrence of any debt that would cause the Company’s debt service coverage ratio to be less than 1.5 times; and (iv) the maintenance at all times of the Company's total unencumbered assets such that they are not less than 150% of the Company’s outstanding unsecured debt.

(4) At December 31, 2025, the Company hadno balance outstanding under its $1.0 billion unsecured revolving credit facility. On September 19, 2024, the Company entered into the Fourth Amended, Restated and Consolidated Credit Agreement (the Amended Credit Agreement) providing for a new amended and restated senior unsecured revolving credit facility. The Amended Credit Agreement amended, restated and replaced the Company's 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 the Company so elects; and (v) modified and simplified the capitalization rates used to value assets under the facility. On September 22, 2025, the Company entered into amendment number one to the Amended Credit Agreement to remove the SOFR index adjustment with respect to loans denominated in USD.

The Amended Credit Agreement provides for an initial maximum principal amount 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 the Company 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. The Company hastwo options to extend the maturity date of the new credit facility by an additionalsix months each (for a total of 12 months), subject to applicable fees and the absence of any default. The unsecured revolving credit facility bears interest at a floating rate of SOFR plus 1.05% (based on our unsecured debt ratings and with a SOFR floor ofzero), which was 4.71% at December 31, 2025. Additionally, the facility fee on the revolving credit facility is 0.25%.

In connection with entering into the Amended Credit Agreement, the Company 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 December 31, 2025 and 2024. During the year ended December 31, 2024, the Company 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.

The facility contains financial covenants or restrictions that limit the Company's level of consolidated debt, secured debt, investment levels outside certain categories and dividend distribution and require the Company to meet certain coverage levels for fixed charges and debt service.

(5) On November 3, 2025, the Company issued $550.0 million in aggregate principal amount of senior notes due November 15, 2030, pursuant to an underwritten public offering. The notes bear interest at an annual rate of 4.75%. Interest is payable on May 15 and November 15 of each year beginning on May 15, 2026 until the stated maturity date of November 15, 2030. The notes were issued at 98.8% of their face value and are unsecured. Net proceeds from the note offering were used to pay down the Company's unsecured revolving credit facility.

(6) The bonds have a variable interest rate that was approximately 3.95% at December 31, 2025. See Note 9 for further details on the Company's interest rate swap agreement related to the Company's variable rate secured bonds.

Certain of the Company’s debt agreements contain customary restrictive covenants related to financial and operating performance and certain cross-default provisions. The Company was in compliance with all financial covenants under the Company's consolidated debt instruments at December 31, 2025.

During the year ended December 31, 2024, the Company's unconsolidated joint ventures holding its equity investments intwo experiential lodging properties located in St. Pete Beach, Florida, were severely damaged by two hurricanes and the Company fully wrote-off its equity investments in these properties. The Company is working in good faith with its joint venture partners, the non-recourse debt provider and the insurance companies to identify a path forward in which the Company expects to result in the eventual removal of the unconsolidated equity investments in these experiential lodging properties and the related non-recourse debt from its portfolio, although there can be no assurances as to the outcome of those discussions.

The Company has equity investments intwo unconsolidated real estate joint ventures that together hold the real estate and operations of an experiential lodging property located in Warrens, Wisconsin. The joint venture that holds the real estate has a secured non-recourse mortgage loan of$23.3 million at December 31, 2025. The maturity date of this mortgage loan is September 15, 2031 and it bears interest at an annual fixed rate of 4.00% with monthly principal and interest payments required.

The Company also has equity investments in two unconsolidated real estate joint ventures that together hold the real estate and operations of an experiential lodging property located in Harrisville, Pennsylvania. The joint venture that holds the real estate has a secured non-recourse senior mortgage loan of$22.3 million outstanding at December 31, 2025. The maturity date of this mortgage loan is November 1, 2029 and it bears interest at an annual fixed rate of 6.38% with monthly interest payments required. The Company has guaranteed $10.0 million in principal on the secured mortgage loan, and, upon completion of construction and achieving a specified debt service coverage ratio, the principal guarantee will be reduced to $5.0 million. The guarantee will be removed completely upon achievement of specified debt service coverage for three consecutive calculation periods.

Principal payments due on long-term debt obligations subsequent to December 31, 2025 (without consideration of any extensions) are as follows (in thousands):

The Company capitalizes a portion of interest costs as a component of property under development. The following is a summary of interest expense, net, for the years ended December 31, 2025, 2024 and 2023 (in thousands):

9. Derivative Instruments

All derivatives are recognized at fair value in the consolidated balance sheets within the line items "Other assets" and "Accounts payable and accrued liabilities" as applicable. The Company has elected not to offset its derivative position for purposes of balance sheet presentation and disclosure. The Company had derivative assets of $0.3 million and $2.2 million at December 31, 2025 and 2024, respectively. The Company had derivative liabilities of $6.9 million and $0.03 million at December 31, 2025 and 2024, respectively. The Company has neither posted nor received collateral with its derivative counterparties as of December 31, 2025 and 2024. See Note 10 for disclosures relating to the fair value of the derivative instruments.

Risk Management Objective of Using Derivatives

The Company is exposed to certain risks arising from both its business operations and economic conditions, including the effect of changes in foreign currency exchange rates on foreign currency transactions and interest rates on its SOFR based borrowings. The Company manages this risk by following established risk management policies and procedures including the use of derivatives. The Company’s objective in using derivatives is to add stability to reported earnings and to manage its exposure to foreign exchange and interest rate movements or other identified risks. To accomplish this objective, the Company primarily uses interest rate swaps, cross-currency swaps and foreign currency forwards.

Cash Flow Hedges of Interest Rate Risk

The Company uses interest rate swaps as its interest rate risk management strategy for certain variable rate debt. Interest rate swaps designated as cash flow hedges involve the receipt or payment of variable-rate amounts from a counterparty, which results in the Company recording net interest expense that is fixed over the life of the agreements without exchange of the underlying notional amount.

At December 31, 2025, the Company had one interest rate swap agreement designated as a cash flow hedge of interest rate risk. The interest rate swap agreement outstanding as of December 31, 2025 is summarized below:

The change in the fair value of interest rate derivatives designated and that qualify as cash flow hedges is recorded in accumulated other comprehensive income (AOCI) and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings within the same income statement line item as the earnings effect of the hedged transaction.

Amounts reported in AOCI related to derivatives will be reclassified to interest expense as interest payments are made on the Company’s variable-rate debt. As of December 31, 2025, the Company estimates that during the year ended December 31, 2026, $74 thousandof losses will be reclassified from AOCI to interest expense.

Cash Flow Hedges of Foreign Exchange Risk

The Company is exposed to foreign currency exchange risk against its functional currency, USD, on CAD denominated cash flow from itssix Canadian properties. The Company uses cross-currency swaps to mitigate its exposure to fluctuations in the USD-CAD exchange rate on cash inflows associated with these properties, which should hedge a significant portion of the Company's expected CAD denominated cash flows. As of December 31, 2025, the Company had the following cross-currency swaps:

The change in the fair value of foreign currency derivatives designated and that qualify as cash flow hedges of foreign exchange risk is recorded in AOCI and reclassified into earnings in the period that the hedged forecasted transaction affects earnings within the same income statement line item as the earnings effect of the hedged transaction. As of December 31, 2025, the Company estimates that during the year ended December 31, 2026, $101 thousand of gains will be reclassified from AOCI to other income.

Fair Value Hedges of Foreign Exchange Risk

During the year ended December 31, 2025, the Company entered into a CAD denominated mortgage note receivable secured by a fitness & wellness property in Winnipeg, Canada. The Company uses cross-currency swaps designated as a fair value hedge to mitigate foreign currency risk associated with fluctuations in the USD-CAD spot rate associated with the principal remeasurement of this mortgage note. The Company entered into a cross-currency swap with an interim and final notional exchange of $27.9 million CAD and $20.0 million USD at a spot rate of $1.392 CAD per USD to fund the principal amount of the mortgage note receivable and monthly exchanges as noted below.

As of December 31, 2025, the Company had the following cross-currency swap designated as a fair value hedge:

The change in fair value of the foreign currency derivative designated and qualifying as a fair value hedge of foreign exchange risk is recorded at fair value each period on the Company's consolidated balance sheets, with the difference resulting from the changes in the spot rate recognized in foreign currency gain (loss). The foreign currency gain (loss) is included in "Other income" or "Other expense," as applicable, on the Company's consolidated statements of income and comprehensive income, which will offset the earnings impact of the foreign currency changes in the underlying transaction being hedged. The initial value of the component excluded from the assessment of effectiveness is recorded in AOCI and reclassified into earnings over the life of the hedging instrument. As of December 31, 2025, the Company estimatesthat during the year ended December 31, 2026, $143 thousand of gains will be reclassified from AOCI to other income.

Net Investment Hedges

The Company is exposed to fluctuations in the USD-CAD exchange rate on its net investments in Canada. As such, the Company uses currency forward agreements to manage its exposure to changes in foreign exchange rates on certain of its foreign net investments. As of December 31, 2025, the Company had the following foreign currency forwards designated as net investment hedges:

On December 19, 2024, the Company terminated its CAD to USD forward contracts in conjunction with entering into the new forward agreements described above. The Company received $10.4 million in connection with the settlement of the CAD to USD forward contracts, which continues to be reported in AOCI until the net investment is sold or liquidated.

For qualifying foreign currency derivatives designated as net investment hedges, the change in the fair value of the derivatives is reported in AOCI as part of the cumulative translation adjustment. Amounts are reclassified out of AOCI into earnings when the hedged net investment is either sold or substantially liquidated. Gains and losses on the derivative representing hedge components excluded from the assessment of effectiveness are recognized over the life of the hedge on a systematic and rational basis, as documented at hedge inception in accordance with the Company's accounting policy election.

Below is a summary of the effect of derivative instruments on the consolidated statements of changes in equity and income for the years ended December 31, 2025, 2024 and 2023:

Effect of Derivative Instruments on the Consolidated Statements of Changes in Equity and Comprehensive Income for the Years Ended December 31, 2025, 2024 and 2023

(1) Included in “Interest expense, net” in accompanying consolidated statements of income and comprehensive income.

(2) Included in "Other income" in the accompanying consolidated statements of income and comprehensive income.

(3) Amounts excluded from the effectiveness testing.

Credit-risk-related Contingent Features

The Company has an agreement with its interest rate derivative counterparty that contains a provision where if the Company defaults on any of its obligations for borrowed money or credit in an amount exceeding $50.0 million and such default is not waived or cured within a specified period of time, including default where repayment of the indebtedness has not been accelerated by the lender, then the Company could also be declared in default on its interest rate derivative obligations.

As of December 31, 2025, the fair value of the Company's derivatives in a liability position related to these agreements was$6.9 million. If the Company breached any of the contractual provisions of these derivative contracts, it would be required to settle its obligations under the agreements at their termination value, which after considering the right of offset, was $6.9 million at December 31, 2025. As of December 31, 2025, the Company had not posted any collateral related to these agreements and was not in breach of any provisions in these agreements.

10. Fair Value Disclosures

The Company has certain financial instruments that are required to be measured under the FASB’s Fair Value Measurement guidance. The Company currently does not have any non-financial assets and non-financial liabilities that are required to be measured at fair value on a recurring basis.

As a basis for considering market participant assumptions in fair value measurements, the FASB’s Fair Value Measurement guidance establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy). Level 1 inputs use quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access. Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3 inputs are unobservable inputs for the asset or liability, which are typically based on an entity’s own assumptions, as there is little to no related market activity. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability.

Derivative Financial Instruments

The Company uses interest rate swaps, foreign currency forwards and cross currency swaps to manage its interest rate and foreign currency risk. The valuation of these instruments is determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves, foreign exchange rates, and implied volatilities. The fair value of interest rate swaps is determined using the market standard methodology of netting the discounted future fixed cash receipts and the discounted expected variable cash payments. The variable cash payments are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves. The Company incorporates credit valuation adjustments to appropriately reflect both its own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements. In adjusting the fair value of its derivative contracts for the effect of nonperformance risk, the Company has considered the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts, and guarantees. In conjunction with the FASB's fair value measurement guidance, the Company made an accounting policy election to measure the credit risk of its derivative financial instruments that are subject to master netting agreements on a net basis by counterparty portfolio.

Although the Company has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with its derivatives also use Level 3 inputs, such as estimates of current credit spreads, to evaluate the likelihood of default by itself and its counterparties. As of December 31, 2025, the Company has assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and has determined that the credit valuation adjustments are not significant to the overall valuation of its derivatives and therefore, has classified its derivatives as Level 2 within the fair value reporting hierarchy.

The table below presents the Company’s financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2025 and 2024, aggregated by the level in the fair value hierarchy within which those measurements are classified and by derivative type.

Assets and Liabilities Measured at Fair Value on a Recurring Basis at December 31, 2025 and 2024

(1) Included in "Other assets" in the accompanying consolidated balance sheets.

(2) Included in "Accounts payable and accrued liabilities" in the accompanying consolidated balance sheets.

Non-recurring fair value measurements

The table below presents the Company's assets measured at fair value on a non-recurring basis as of December 31, 2025 and 2024, aggregated by the level in the fair value hierarchy within which those measurements fall.

Assets Measured at Fair Value on a Non-Recurring Basis at December 31, 2025 and 2024

(1) As further discussed in Note 7, during the year ended December 31, 2025, the Company recorded an allowance for credit loss totaling $6.4 million related toone mortgage note receivable to fully reserve the outstanding principal balance as a result of changes in the borrower's financial status. Management valued the mortgage note receivable based on the fair value of the underlying collateral, which was determined taking into account various factors including implied asset value changes based on current market conditions and review of the financial statements of the borrower and was classified within Level 3 of the fair value hierarchy.

(2) As further discussed in Note 5, during the year ended December 31, 2024, the Company recorded impairment charges of $51.8 million related to real estate investments, net, onfive theatre properties. Management estimated the fair value of these investments taking into account various factors, including purchase offers, independent appraisals, shortened hold periods and market conditions. The Company determined, based on the inputs, that its valuation of four of these properties with purchase offers were classified as Level 2 of the fair value hierarchy and were measured at fair value. One property was measured at fair value using an independent appraisal, which used a discounted cash flow model. The significant inputs and assumptions used in the real estate appraisal included land valued at approximately $475 thousand per acre less demolition costs of approximately $13.91 per square foot of building. These measurements were classified within Level 3 of the fair value hierarchy because many of the assumptions were not observable.

(3)As further discussed in Note 7, during the year ended December 31, 2024, the Company recorded an allowance for credit loss totaling $10.3 million related toone mortgage note receivable to reserve the outstanding principal balance as a result of changes in the borrower's financial status. Management valued the mortgage note receivable based on the fair value of the underlying collateral, which was determined taking into account various factors including implied asset value changes based on current market conditions and review of the financial statements of the borrower and was classified within Level 3 of the fair value hierarchy.

(4) During the year ended December 31, 2024, the Company recorded impairment charges of $28.2 million related to its investment intwo unconsolidated real estate joint ventures that owntwo experiential lodging properties located in St. Pete Beach, Florida andtwo unconsolidated real estate joint ventures that own an experiential lodging property located in Breaux Bridge, Louisiana. Management estimated the fair value of these investments, taking into account various factors including implied asset value changes based on discounted cash flow projections and current market conditions. The Company determined, based on the inputs, that its valuation of investment in joint ventures was classified within Level 3 of the fair value hierarchy as many of the assumptions were not observable.

Fair Value of Financial Instruments

The following methods and assumptions were used by the Company to estimate the fair value of each class of financial instruments at December 31, 2025 and 2024:

Mortgage notes receivable and related accrued interest receivable:

The fair value of the Company’s mortgage notes and related accrued interest receivable is estimated by discounting the future cash flows of each instrument using current market rates. At December 31, 2025, the Company had a carrying value of $679.3 million in fixed rate mortgage notes receivable outstanding, including related accrued interest, with a weighted average interest rate of approximately 8.97%. The fixed rate mort gage notes bear interest atrates of 7.15% to 12.69%. Discounting the future cash flows for fixed rate mortgage notes receivable using estimated market rates of 7.00% to 10.50%, management estimates the fair value of the fixed rate mortgage notes receivable to be $728.0 million with an estimated weighted average market rate of 7.91%at December 31, 2025.

At December 31, 2024, the Company had a carrying value of $665.8 million in fixed rate mortgage notes receivable outstanding, including related accrued interest, with a weighted average interest rate of approximately 8.88%. The fixed rate mortgage notes bear interest at rates of 7.15% to 12.50%. Discounting the future cash flows for fixed rate mortgage notes receivable using estimated market rates of 7.45% to 10.00%, management estimates the fair value of the fixed rate mortgage notes receivable to be $701.7 million with an estimated weighted average market rate of 8.08% at December 31, 2024.

Derivative instruments:

Derivative instruments are carried at their fair value.

Debt instruments:

The fair value of the Company's debt is estimated by discounting the future cash flows of each instrument using current market rates. At December 31, 2025, the Company had a carrying value of $25.0 million in variable rate debt outstanding with an interest rate of approximately 3.95%. The carrying value of the variable rate debt outstanding approximates the fair value at December 31, 2025.

At December 31, 2024, the Companyhad a carrying value of $200.0 million in variable rate debt outstanding with an interest rate of approximately 5.34%. The carrying value of the variable rate debt outstanding approximates the fair value at December 31, 2024.

At both December 31, 2025 and 2024, the $25.0 million of variable rate debt outstanding, discussed above, had been effectively converted to a fixed rate by an interest rate swap agreement. See Note 9 for additional information related to the Company's interest rate swap agreement.

At December 31, 2025, the Company had a carrying value of $2.93 billion in fixed rate long-term debt outstanding with a weighted average interest rate of approximately 4.40%. Discounting the future cash flows for fixed rate debt using December 31, 2025 market rates of 3.54% to 5.12%, management estimates the fair value of the fixed rate debt to be approximately $2.85 billion with an estimated weighted average market rate of 4.61% at December 31, 2025.

At December 31, 2024, the Company had a carrying value of $2.68 billion in fixed rate long-term debt outstanding with a weighted average interest rate of approximately 4.34%. Discounting the future cash flows for fixed rate debt using December 31, 2024 market rates of 5.22% to 5.83%, management estimates the fair value of the fixed rate debt to be approximately $2.57 billion with an estimated weighted average market rate of 5.53% at December 31, 2024.

11. Common and Preferred Shares

On June 3, 2025, the Company filed a shelf registration statement with the SEC, which is effective for a term ofthree years. The securities covered by this registration statement include common shares, preferred shares, debt securities, depositary shares, warrants and units. The Company may periodically offer one or more of these securities in amounts, prices and on terms to be announced when and if these securities are offered. The specifics of any future offerings along with the use of proceeds of any securities offered, will be described in detail in a prospectus supplement, or other offering materials, at the time of any offering.

Additionally, on June 3, 2025, the Company filed a shelf registration statement with the SEC, which is effective for a term ofthree years, for its Dividend Reinvestment and Direct Share Purchase Plan (DSP Plan), which permits the issuance of up to 25,000,000 common shares.

On December 5, 2025, in connection with the commencement of an “at-the-market” offering program (ATM Program), the Company entered into an equity distribution agreement with certain institutional investment banks pursuant to which the Company may issue common shares having an aggregate sales price of up to $400.0 million on the open market or in privately negotiated transactions deemed to be “at-the-market” offerings under SEC rules, with the banks acting as (i) sales agents (or principals when purchasing shares directly for their own account) or (ii) forward sellers on behalf of any forward purchasers pursuant to a forward sale agreement. If the Company issues any shares under the ATM Program or enters into a forward sale agreement, the applicable sales agent or forward seller may receive commissions of up to 2.0% of the gross sales price of the shares sold.

The use of forward sales agreements allows the Company to lock in a share price on the sale of shares at the time the forward sale agreement becomes effective, but defer receiving the proceeds from the sale of shares until a later date. If the Company enters into a forward sale agreement, it expects to physically settle each forward sale agreement with the forward purchaser on one or more dates specified by the Company prior to the maturity date of that particular forward sale agreement, in which case the aggregate net cash proceeds at settlement will equal the number of shares underlying the particular forward sale agreement multiplied by the relevant forward sale price. However, the Company may also elect to cash settle or net share settle a particular forward sale agreement, in which case cash proceeds may or may not be received or cash may be owed to the forward purchaser. Until settlement of the forward sale agreements, earnings per share dilution resulting from the forward sale agreements will be determined under the treasury stock method. Share dilution occurs when the average market price of the Company's common shares is higher than the average forward sales price.

As of December 31, 2025, the Company had not issued any common shares or entered into any forward sale agreement, and $400.0 million remained available for sale under the ATM Program. Future sales will depend upon a variety of factors including, but not limited to, market conditions, the trading price of the Company’s common shares and the Company’s capital needs. The Company has no obligation to sell any shares available for sale under the ATM Program.

Common Shares

The Company's Board declared cash dividends totaling $3.52 and $3.40 per common share for the years ended December 31, 2025 and 2024, respectively.

Of the total distributions calculated for tax purposes, the amounts characterized as ordinary income, return of capital and long-term capital gain for cash distributions paid per common share for the years ended December 31, 2025 and 2024 are as follows:

During the years ended December 31, 2025 and 2024, the Company issued an aggregate of 25,758 and 26,878 common shares under its DSP Plan for net proceeds of$1.3 million and $1.2 million, respectively.

Series C Convertible Preferred Shares

The Company has 5.4 million outstanding 5.75% Series C cumulative convertible preferred shares (Series C preferred shares). The Company will pay cumulative dividends on the Series C preferred shares from the date of original issuance in the amount of $1.4375 per share each year, which is equivalent to 5.75% of the $25 liquidation preference per share. Dividends on the Series C preferred shares are payable quarterly in arrears. The Company does not have the right to redeem the Series C preferred shares except in limited circumstances to preserve the Company’s REIT status. The Series C preferred shares have no stated maturity and will not be subject to any sinking fund or mandatory redemption. As of December 31, 2025, the Series C preferred shares are convertible, at the holder’s option, into the Company’s common shares at a conversion rate of 0.4378 common shares per Series C preferred share, which is equivalent to a conversion price of $57.10 per common share. This conversion ratio may increase over time upon certain specified triggering events including if the Company’s common dividends per share exceed a quarterly threshold of $0.6875.

Upon the occurrence of certain fundamental changes, the Company will under certain circumstances increase the conversion rate by a number of additional common shares or, in lieu thereof, may in certain circumstances elect to adjust the conversion rate upon the Series C preferred shares becoming convertible into shares of the public acquiring or surviving company.

The Company may, at its option, cause the Series C preferred shares to be automatically converted into that number of common shares that are issuable at the then prevailing conversion rate. The Company may exercise its conversion right only if, at certain times, the closing price of the Company’s common shares equals or exceeds 135% of the then prevailing conversion price of the Series C preferred shares.

Owners of the Series C preferred shares generally have no voting rights, except under certain dividend defaults. Upon conversion, the Company may choose to deliver the conversion value to the owners in cash, common shares, or a combination of cash and common shares.

The Company's Board declared cash dividends totaling $1.4375 per Series C preferred share for each of the years ended December 31, 2025 and 2024. There were non-cash distributions associated with conversion adjustments of$0.3459 and $0.2769 per Series C preferred share for the years ended December 31, 2025 and 2024, respectively. The conversion adjustment provision entitles the shareholders of the Series C preferred shares, upon certain quarterly common share dividend thresholds being met, to receive additional common shares of the Company upon a conversion of the preferred shares into common shares. The increase in common shares to be received upon a conversion is a deemed distribution for federal income tax purposes.

For tax purposes, the amounts characterized as ordinary income, return of capital and long-term capital gain for cash distributions paid and non-cash deemed distributions per Series C preferred share for the years ended December 31, 2025 and 2024 are as follows:

(2) For the year ended December 31, 2025, amounts qualify in their entirety as 199A distributions. For the year ended December 31, 2024, no amounts qualify as 199A distributions.

Series E Convertible Preferred Shares

The Company has 3.4 million outstanding 9.00% Series E cumulative convertible preferred shares (Series E preferred shares). The Company will pay cumulative dividends on the Series E preferred shares from the date of original issuance in the amount of $2.25 per share each year, which is equivalent to 9.00% of the $25 liquidation preference per share. Dividends on the Series E preferred shares are payable quarterly in arrears. The Company does not have the right to redeem the Series E preferred shares except in limited circumstances to preserve the Company’s REIT status. The Series E preferred shares have no stated maturity and will not be subject to any sinking fund or mandatory redemption. As of December 31, 2025, the Series E preferred shares are convertible, at the holder’s option, into the Company’s common shares at a conversion rate of 0.4845 common shares per Series E preferred share, which is equivalent to a conversion price of $51.60 per common share. This conversion ratio may increase over time upon certain specified triggering events including if the Company’s common dividends per share exceeds a quarterly threshold of $0.84.

Upon the occurrence of certain fundamental changes, the Company will under certain circumstances increase the conversion rate by a number of additional common shares or, in lieu thereof, may in certain circumstances elect to adjust the conversion rate upon the Series E preferred shares becoming convertible into shares of the public acquiring or surviving company.

The Company may, at its option, cause the Series E preferred shares to be automatically converted into that number of common shares that are issuable at the then prevailing conversion rate. The Company may exercise its conversion right only if, at certain times, the closing price of the Company’s common shares equals or exceeds 150% of the then prevailing conversion price of the Series E preferred shares.

Owners of the Series E preferred shares generally have no voting rights, except under certain dividend defaults. Upon conversion, the Company may choose to deliver the conversion value to the owners in cash, common shares, or a combination of cash and common shares.

The Company's Board declared cash dividends totaling $2.25 per Series E preferred share for each of the years ended December 31, 2025 and 2024. There were no non-cash distributions associated with conversion adjustments per Series E preferred share for both years ended December 31, 2025 and 2024. The conversion adjustment provision entitles the shareholders of the Series E preferred shares, upon certain quarterly common share dividend thresholds being met, to receive additional common shares of the Company upon a conversion of the preferred shares into common shares. The increase in common shares to be received upon a conversion is a deemed distribution for federal income tax purposes.

For tax purposes, the amounts characterized as ordinary income, return of capital and long-term capital gain for cash distributions paid per Series E preferred share for the years ended December 31, 2025 and 2024 are as follows:

Series G Preferred Shares

The Company has 6.0 million outstanding 5.75% Series G cumulative redeemable preferred shares (Series G preferred shares). The Company will pay cumulative dividends on the Series G preferred shares from the date of original issuance in the amount of $1.4375 per share each year, which is equivalent to 5.75% of the $25.00 liquidation preference per share. Dividends on the Series G preferred shares are payable quarterly in arrears. The Company may, at its option, redeem the Series G preferred shares in whole at any time or in part from time to time by paying $25.00 per share, plus any accrued and unpaid dividends up to, but not including the date of redemption. The Series G preferred shares have no stated maturity and will not be subject to any sinking fund or mandatory redemption. The Series G preferred shares are not convertible into any of the Company's securities, except under certain circumstances in connection with a change of control. Owners of the Series G preferred shares generally have no voting rights except under certain dividend defaults.

The Company's Board declared cash dividends totaling $1.4375 per Series G preferred share for each of the years ended December 31, 2025 and 2024. For tax purposes, the amounts characterized as ordinary income, return of capital and long-term capital gain for cash distributions paid per Series G preferred share for the years ended December 31, 2025 and 2024 are as follows:

12. Earnings Per Share

The following table summarizes the Company’s computations of basic and diluted earnings per share (EPS) for the years ended December 31, 2025, 2024 and 2023 (amounts in thousands except per share information):

The effect of the potential common shares from the conversion of the Company’s convertible preferred shares and from the exercise of share options are included in diluted earnings per share if the effect is dilutive. Potential common shares from the performance share units are included in diluted earnings per share upon the satisfaction of certain performance and market conditions. These conditions are evaluated at each reporting period and if the conditions have been satisfied during the reporting period, the number of contingently issuable shares are included in the computation of diluted earnings per share.

The following shares have been excluded from the calculation of diluted earnings per share because they are anti-dilutive, or in the case of contingently issuable performance share units, are not probable of issuance:

•The additional 2.3 million common shares that would result from the conversion of the Company’s 5.75% Series C cumulative convertible preferred shares and the corresponding add-back of the preferred dividends declared on those shares for each of the years ended December 31, 2025, 2024 and 2023.

•The additional 1.7 million common shares that would result from the conversion of the Company’s 9.0% Series E cumulative convertible preferred shares and the corresponding add-back of the preferred dividends declared on those shares for each of the years ended December 31, 2025, 2024 and 2023.

•Outstanding options to purchase 11 thousand common shares at per share prices ranging from $56.94 to $76.63 for the year ended December 31, 2025.

•Outstanding options to purchase 57 thousand and 81 thousand common shares at per share prices ranging from $44.44 to $76.63 for the years ended December 31, 2024 and 2023, respectively.

•The effect of 116 thousand contingently issuable performance share units granted during 2024 for the year ended December 31, 2024.

13. Retirement of Executives

During the year ended December 31, 2025, the Company's Executive Vice President and Chief Investment Officer, Greg Zimmerman, notified the Company of his intention to retire from his position in the first quarter of 2026. On February 23, 2026, he notified the Company that his retirement will be effective March 2, 2026. The role of Executive Vice President and Chief Investment Officer will be assumed by Ben Fox, who joined the Company in August of 2025. For the year ended December 31, 2025, the Company recorded retirement and severance expense related to Mr. Zimmerman's expected retirement totaling $3.0 million, which included cash payments totaling $0.8 million and accelerated vesting of nonvested shares totaling $2.2 million.

On March 1, 2024, the Company's Executive Vice President, General Counsel and Secretary, Craig Evans, retired from the Company. Details of Mr. Evans' retirement are included in the previously disclosed Retirement and Release Agreement entered into between the Company and Mr. Evans. The role of General Counsel and Secretary was assumed by Paul Turvey upon Mr. Evans' retirement. For the year ended December 31, 2024, the Company 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.

14. Equity Incentive Plans

The Company issues equity awards under the 2016 Equity Incentive Plan, which may be in the form of restricted common shares, restricted share units, performance share units or other share-based awards. On May 6, 2025, the Company amended the 2016 Equity Incentive Plan by shareholder vote to increase the maximum number of authorized shares issuable under the plan from 3,950,000 to 5,950,000 shares. Additionally, the 2020 Long Term Incentive Plan (2020 LTIP) is a sub-plan under the Company's 2016 Equity Incentive Plan. Under the 2020 LTIP, the Company awards performance share units and restricted shares to the Company's executive officers. At December 31, 2025, there were 2,295,262 shares avail able for grant under the 2016 Equity Incentive Plan.

Nonvested Shares

A summary of the Company’s nonvested share activity and related information is as follows:

The holders of nonvested shares have voting rights and receive dividends from the date of grant. The fair value of the nonvested shares that vested was$11.8 million, $13.7 million, and $8.7 million for the years ended December 31, 2025, 2024 and 2023, respectively. Expense recognized related to nonvested shares and included in "General and administrative expense" in the accompanying consolidated statements of income and comprehensive income was $7.8 million, $6.9 million and $7.6 million for the years ended December 31, 2025, 2024 and 2023, respectively. Expense related to nonvested shares and included in"Retirement and severance expense" in the accompanying consolidated statements of income and comprehensive income was $1.0 million, $0.7 million and $0.4 million for the years ended December 31, 2025, 2024 and 2023, respectively. At December 31, 2025, unamortized share-based compensation expense related to nonvested shares was$11.0 million and will be recognized in future periods as follows (in thousands):

Nonvested Performance Share Units

A summary of the Company's nonvested performance share unit activity and related information is as follows:

(1) The grant date fair value was determined utilizing (i) a Monte Carlo simulation model to generate an estimate of the Company's future share price over the three-year performance period for performance share units based on the Company's Total Shareholder Return (TSR) performance further described below and (ii) the Company's grant date fair value for performance share units based on the Company's Compounded Annual Growth Rate (CAGR) in AFFO per share over the three-year performance period.

(2) The achievement of the performance conditions for the performance share units granted during the year ended December 31, 2022 resulted in a performance payout percentage of 200% for both the Company's TSR relative to the TSRs of the Company's peer group companies and the Company's TSR relative to the TSRs of companies in the MSCI US REIT Index, and a payout percentage of 200% for the Company's CAGR in AFFO per share over the three-year performance period. The achievement of the performance conditions and the above payout percentages resulted in the issuance of 197,220 common shares and 51,612 common shares from dividend equivalents. The fair value of the performance share units and dividend equivalents that vested was $12.3 million.

The number of common shares issuable upon settlement of the performance share units granted during the years ended December 31, 2025, 2024 and 2023 will be based upon the Company's achievement level relative to the following performance measures over a three-year performance period ending December 31, 2027, 2026 and 2025, respectively. The Company's achievement level relative to the performance measures is assigned a specific payout percentage which is multiplied by the target number of performance share units.

The performance share units based on relative TSR performance have market conditions and are valued using a Monte Carlo simulation model on the grant date, which resulted in a grant date fair value of approximately$6.3 million, $4.1 million and $5.9 million for the years ended December 31, 2025, 2024 and 2023, respectively. The estimated fair value is amortized to expense over thethree-year vesting period, which ends on December 31, 2027, 2026 and 2025 for performance share units granted in 2025, 2024 and 2023, respectively. The following assumptions were used in the Monte Carlo simulation for computing the grant date fair value of the performance share units with a market condition for the years ended December 31, 2025, 2024 and 2023, respectively: risk-free interest rate of 4.2%,4.5% and 4.4%, volatility factors in the expected market price of the Company's common shares of 25%, 30% and 52% and an expected life of approximately three years.

The performance share units based on growth in AFFO per share have a performance condition. The probability of achieving the performance condition is assessed at each reporting period. If it is deemed probable that the performance condition will be met, compensation cost will be recognized based on the closing price per share of the Company's common shares on the date of the grant multiplied by the number of awards expected to be earned. If it is deemed that it is not probable that the performance condition will be met, the Company will discontinue the recognition of compensation cost and any compensation cost previously recorded will be reve rsed. At December 31, 2025, achievement of the performance condition was deemed probable for the performance share units granted during the year ended December 31, 2025 with an expected payout percentage of 157%, which resulted in a grant date fair value of approximately $1.9 million. Achievement of the performance condition for the performance share units granted during the years ended December 31, 2024 and 2023 was deemed not probable at December 31, 2025.

Expense recognized related to performance share units and included in "General and administrative expense" in the accompanying consolidated statements of income and comprehensive income was$5.3 million, $5.4 million and $7.9 million for the years ended December 31, 2025, 2024 and 2023, respectively. Expense related to performance share units and included in "Retirement and severance expense" in the accompanying consolidated statements of income and comprehensive income was$1.2 million and $0.9 million for the years ended December 31, 2025 and 2024, respectively.

At December 31, 2025, unamortized share-based compensation expense related to nonvested performance share units was$6.1 million and will be recognized in future periods as follows (in thousands):

Restricted Share Units

A summary of the Company’s restricted share unit activity and related information is as follows:

The holders of restricted share units receive dividend equivalents from the date of grant. Total expense recognized related to shares issued to non-associate Trustees and included in "General and administrative expense" in the accompanying consolidated statements of income and comprehensive income was$2.2 million, $1.8 million and $1.9 million for the years ended December 31, 2025, 2024 and 2023, respectively. At December 31, 2025, unamortized share-based compensation expense related to restricted share units was$982 thousand, which will be recognized in 2026.

15. Operating Leases

The Company’s real estate inve stments are leased under operating leases with remaining terms ranging fromone year to 26 years.

The following table summarizes the future minimum rentals on the Company's lessor and sublessor arrangements at December 31, 2025 (in thousands):

(1) Included in rental revenue.

In addition to its lessor arrangements on its real estate investments, as of December 31, 2025 and 2024, the Company was lessee in 50 and 51 operating ground leases, respectively, as well as lessee in an operating lease of its executive office. The Company's tenants, who are generally subtenants under these ground leases, are responsible for paying the rent under these ground leases. As of December 31, 2025, rental revenue fromone of the Company's tenants, who is also a subtenant under certain ground leases, is being recognized on a cash basis. In addition, two of the Company's ground leases do not currently have subtenants. In the event the tenant fails to pay the ground lease rent or if the property does not have sub-tenants, the Company is primarily responsible for the payment, assuming the Company does not sell or re-tenant the property. As of December 31, 2025, the ground lease arrangements have remaining terms ranging from eight months to 17 years. Most of these leases include one or more options to renew. The Company assesses these options using a threshold of reasonably certain, which also includes an assessment of the term of the Company's tenants' leases. For leases where renewal is reasonably certain, those option periods are included within the lease term and also the measurement of the operating lease right-of-use asset and liability. The ground lease arrangements do not contain any residual value guarantees or any material restrictions. As of December 31, 2025, the Company does not have any leases that have not commenced but that create significant rights and obligations.

The Company determines whether an arrangement is or includes a lease at contract inception. For arrangements in which the Company is lessee, operating lease right-of-use assets and liabilities are recognized at commencement date and initially measured based on the present value of lease payments over the defined lease terms. As the Company's leases do not provide an implicit rate, the Company used its incremental borrowing rate in determining the present value of lease payments. The incremental borrowing rate was adjusted for collateral based on the information available at adoption or the commencement date. Inputs to the calculation of the Company's incremental borrowing rate include its senior notes and their option adjusted credit spreads over comparable U.S. Treasury rates, adjusted to a collateralized basis by estimating the credit spread improvement that would result from an upgrade of one ratings classification.

During the year ended December 31, 2025, the Company exercised an early termination option of a ground lease on an eat & play property. As a result, the Company recognized a gain of $3.4 million due to the reassessment of the lease term and the corresponding remeasurement of the lease liability and right-of-use asset, which is recorded in "Gain (loss) on sale of real estate and early ground lease termination" in the accompanying consolidated statement of income and comprehensive income for the year ended December 31, 2025.

The following table summarizes the future minimum lease payments under the ground lease obligations and the office lease at December 31, 2025, excluding contingent rent due under leases where the ground lease payment, or a portion thereof, is based on the level of the tenant's sales (in thousands):

(1) Included in property operating expense.

(2) Included in general and administrative expense.

(3) Subsequent to December 31, 2025, the Company signed a new office lease for a term of 10.5 years for approximately 41,525 square feet of office space. The lease is expected to commence on January 1, 2027 with an initial annual rent payment of approximately $1.0 million.

The following table summarizes the carrying amounts of the operating lease right-of-use assets and liabilities as of December 31, 2025 and 2024 (in thousands):

The following table summarizes rental revenue, including sublease arrangements and lease costs, for the years ended December 31, 2025, 2024 and 2023 (inthousands):

The following table summarizes the weighted-average remaining lease term and the weighted-average discount rate for arrangements where the Company is the lessee as of December 31, 2025 and 2024:

16. Other Commitments and Contingencies

As of December 31, 2025, the Company had 14 development projects with commitments to fund an aggregate of approximately $53.7 million. The Company advances development costs in periodic draws. If the Company determines that construction is not being completed or progressing in accordance with the terms of the development agreement, it can discontinue funding construction draws. The Company has agreed to lease the properties to the operators at predetermined rates upon completion of construction.

The Company has certain commitments related to its mortgage notes and notes receivable investments that it may be required to fund in the future. The Company is generally obligated to fund these commitments at the request of theborrower or upon the occurrence of specified events outside of its direct control. As of December 31, 2025, the Company hadtwo mortgage notes with commitments totaling approximately $48.1 million. Ifcommitments are funded in the future, the Company will charge interest at rates consistent with the existing investments.

17. Segment Information

The Company groups its investments intotwo reportable segments: Experiential and Education.

The financial information summarized below is presented by reportable segment (in thousands):

Schedule III - Real Estate and Accumulated Depreciation

December 31, 2025

Schedule III - Real Estate and Accumulated Depreciation (continued)

Reconciliation

December 31, 2025

See accompanying report of independent registered public accounting firm.