EPR 10-K & 10-Q changes, risk factors and insider trading

Global economic and geopolitical uncertainty, disruptions in the financial markets, inflation, and the challenging economic environment may impair our ability to refinance existing obligations or obtain new financing for acquisition or development of properties.

There continues to be a high level of global economic and geopolitical challenges and uncertainty, including uncertainty regarding interest rates, inflationary pressures, tariffs and trade policies, geopolitical conflicts and political changes in the U.S. and abroad, all of which have contributed to volatility in the global financial markets and contributed to negative performance of the real estate sector. REITs are generally experiencing heightened risks and uncertainties resulting from current challenging economic conditions, including significant volatility and negative pressure in financial and capital markets, higher cost of capital, lasting impacts of high inflation and other risks and uncertainties associated with the current economic environment. Our business has been more acutely affected by these risks.

We cannot predict the degree to which the effects of any future pandemic, epidemic or outbreak of any highly infectious disease may adversely affect our business, financial conditionscondition and results of operations. The COVID-19 pandemic severely impacted global economic activity and caused significant volatility and negative pressure in financial markets. In response to the COVID-19 pandemic, many jurisdictions within the United States and abroad instituted health and safety measures, including quarantines, mandated business and school closures and travel restrictions. As a result, the COVID-19 pandemic severely impacted experiential real estate properties given that such properties involve congregate social activity and discretionary consumer spending.

Inflation, both real orand anticipated as well as any resulting governmental policies, could adversely affect the economy and the costs of labor, goods and services to our tenants or borrowers. Our long-term leases and loans typically contain provisions such as rent escalators, percentage rent or participating interest, designed to mitigate the adverse impact of inflation. However, these provisions may have limited effectiveness at mitigating the risk of high levels of inflation due to contractual limits on escalation, which exist on substantially all of our escalation provisions and the uncertainty that percentage rent and participating interest provisions will capture the impact of such inflation through higher revenues realized at the applicable properties. Many of our leases are triple-net and typically require the tenant to pay all property operating expenses and, therefore, increases in property-level expenses at our leased properties generally do not directly affect us. However, increased operating costs resulting from inflation could have an adverse impact on our tenants and borrowers if increases in their operating expenses exceed increases in their revenue, which may adversely affect our tenants’ or borrowers' ability to pay rent or other obligations owed to us. An increase in our customers' expenses and a failure of their revenues to increase at least with inflation could adversely impact our customers' and our financial condition and our results of operations.

Additionally, a portion of our leases are not triple-net leases, which exposes us to the risk of potential common area maintenance expense slippage that occurs when the actual cost of taxes, insurance and maintenance at the property exceeds the reimbursements paid by tenants. To the extent any of these leases contain fixed expense reimbursement provisions or limitations, we may be subject to increases in costs resulting from inflation that are not fully passed through to tenants, which could adversely impact our financial condition and our results of our operations.

Most of our portfolio is leased to or financed with customers operating service or retail businesses on our property locations. Many of these customers operate services or businesses that are dependent upon consumer experiences. The success of most of these businesses depends on the willingness or ability of consumers to use their discretionary income to purchase our customers' products or services. A downturn in the economy, or a trend to not want to go "out of homehome," could cause consumers in each of our property types to reduce their discretionary spending within the market segments in which our customers or potential customers operate, which could adversely affect such customers' operations and, in turn, reduce the demand for our properties or financing solutions.

Our unsecured revolving credit facility, senior notes and other loans that we may obtain in the future contain certain cross-default provisions as well as customary restrictions, requirements and other limitations on our ability to incur indebtedness, including covenants involving our maximum total debt to total asset value; maximum permitted investments; minimum tangible net worth; maximum secured debt to total asset value; maximum unsecured debt to eligible unencumbered properties; minimum unsecured interest coverage; and minimum fixed charge coverage. Our ability to borrow under our unsecured revolving credit facility is also subject to compliance with certain other covenants. We also have senior notes issued in a private placement transaction that are subject to certain covenants. In addition, some of our properties, including those held in joint ventures, are subject to mortgages that contain customary covenants such as those that limit our ability, without the prior consent of the lender, to further mortgage the applicable property or to discontinue or reduce insurance coverage.

We rely on debt financing, including borrowings under our unsecured revolving credit facility, issuances of debt securities and debt secured by individual properties, to finance our acquisition and development activities and for working capital. If we are unable to obtain financing from these or other sources, or to refinance existing indebtedness upon maturity, our financial condition and results of operations would likely be adversely affected. We are also currently experiencing elevated costs of capital, which negatively impacts our ability to make investments in the near term. The ultimate extent to which the current challenging economic environment impacts our ability to comply with existing financial covenants and obtain financing will depend on future developments, which, as discussed above, are highly uncertain and cannot be predicted with confidence.

Interest rates are highly sensitive to many factors that are beyond our control, including general economic conditions and policies of various governmental and regulatory agencies. The U.S. Federal Reserve raised the benchmark interest rate significantly sincein 2022.2022 and again in 2023. Although the benchmark interest rate was decreased in the second half of 2024,2024 and again in 2025, there can be no assurances that the rate will not increase in the future. Increases in interest rates could have an adverse impact on our business by increasing the cost of borrowing, affecting our interest costs and our ability to make new investments on favorable terms or at all. Rising interest rates, or the continuation of elevated rates into the future, could limit our ability to refinance existing debt when it matures or cause us to pay higher interest rates upon refinancing and increase interest expense on refinanced indebtedness. In addition, higher interest rates could decrease the amount third parties are willing to pay for our assets, thereby limiting our ability to reposition our portfolio efficiently in response to changes in economic or other conditions.

At any time, a tenant may experience a downturn in its business that may weaken its financial condition. Similarly, a general decline in the economy may result in a decline in demand for space at our commercial properties. Our financial results depend significantly on leasing space at our properties to tenants on economically favorable terms. In addition, because a majority of our income comes from leasing real property, our income, funds available to pay indebtedness and funds available for distribution to our shareholders or share repurchases will decrease if a significant number of our tenants cannot pay their rent or if we are not able to maintain our levels of occupancy on favorable terms. If our tenants cannot pay their rent or we are not able to maintain our levels of occupancy on favorable terms, there is also a risk that the fair value of the underlying property will be considered less than its carrying value and we may have to take a charge against earnings. In addition, if a tenant does not pay its rent, we might not be able to enforce our rights as landlord without significant delays and substantial legal costs.

A tenant becoming bankrupt or insolvent could diminish or eliminate the income we expect from that tenant's leases. If a tenant becomes insolvent or bankrupt, we cannot be sure that we could promptly recover the premises from the tenant or from a trustee or debtor-in-possession in a bankruptcy proceeding relating to the tenant. On the other hand, a bankruptcy court might authorize the tenant to terminate its leases with us. If that happens, our claim against the bankrupt tenant for unpaid future rent would be subject to statutory limitations that might be substantially less than the remaining rent owed under the leases. In addition, any claim we have for unpaid past rent would likely not be paid in full and we would take a charge against earnings for any accrued straight-line rent receivable related to the leases. We have experienced material customer bankruptcies in the past. Specifically, in 2022, Regal filed for protection under Chapter 11 of the U.S. Bankruptcy Code. At the time of its bankruptcy filing, Regal leased 57 theatres from us pursuant to two master leases and 28 single property leases. As a result of the resolution of this bankruptcy in 2023, we entered into a new master lease with Regal for 41 properties, took back 16 properties and agreed to hold a significant amount of deferred rent owed by Regal in abeyance with a remaining portion discharged in bankruptcy. There can be no assurances that our tenants will not become bankrupt or insolvent in the future.

We may sell or divest different properties or assets after an evaluation of our portfolio of businesses.businesses or as a result of a customer exercising a purchase or note pay-off option. Such sales or divestitures could affect our costs, revenues, results of operations, financial condition and liquidity.

From time to time, we may evaluate our properties and may, as a result, sell or attempt to sell, divest, or spin-off different properties or assets, subject, if applicable, to the terms of lease agreements. In addition, certain of our customer agreements provide customers with purchase or note pay-off options. Future sales or divestitures could affect our costs, revenues, results of operations, financial condition, liquidity and our ability to comply with applicable financial covenants. Divestitures have inherent risks, including possible delays in closing transactions, potential difficulties in obtaining regulatory approvals, receiving lower-than-expected sales proceeds for the divested assets, potential impairment charges and potential post-closing claims for indemnification. In addition, economic conditions, such as high inflation or rising interest rates, and relatively illiquid real estate markets may result in fewer potential bidders and unsuccessful sales efforts with respect to potential sales or divestitures.

From time to time, the base terms of some of our leases with our tenants will expire. These tenants have and may continue to seek rent or other concessions from us, including requiring us to modify the properties in order to renew their leases. There is no guarantee that we will be able to renew these leases at existing lease terms, at otherwise economically favorable terms or at all. In addition, if we fail to renew these leases, there can be no assurances that we will be able to locate substitute tenants for such properties or enter into leases with these substitute tenants on economically favorable terms.terms, which may impact our financial results by lowering income or requiring us to record an impairment loss.

The ability of our customers to operate successfully in the experiential real estate industry and remain current on their obligations depends on a number of factors, including, with respect to theatres, the availability and popularity of motion pictures, the performance of those pictures in tenants' markets, the allocation of popular pictures to tenants, the release window (the time that elapses from the date of a motion picture's theatrical release to the date it is available on other mediums) and the terms on which the motion pictures are licensed. In addition, motion picture production is highly dependent on labor that is subject to various collective bargaining agreements. The Writers Guild of America strike of 2023 halted motion picture production and may delay or otherwise affect the supply of certain motion pictures. The Screen Actors Guild strikestrikes ofin 2023 alsosignificantly had a similar effect onimpacted the production and supply of motion pictures. Studios are party to collective bargaining agreements with a number of other labor unions, and failure to reach timely agreements or renewals of existing agreements or future strikes or labor disruptions may further affect the production, supply and theatrical release of motion pictures. Studios or motion picture distributors may, as a result of consolidation or otherwise, modify their traditional studio release models, such as reducing the number of wide release titles or reducing theatrical release windows. Neither we nor our customers control the operations of studios or motion picture distributors. There can be no assurances that motion picture distributors will continue to rely on theatres as the primary means of distributing first-run films and motion picture distributors have, and may in the future, consider alternative film delivery methods. In addition, in August 2020, a U.S. District Court granted the U.S. Department of Justice's request to terminate the Paramount Consent Decrees, which prohibit movie studios from owning theatres or utilizing "block booking," a practice whereby movie studios sell multiple films as a package to theatres, in addition to other restrictions. There can be no assurances as to the effects of this regulatory action or whether this regulatory action will materially adversely affect our theatre customers' operations and, in turn, their ability to perform under their leases.

Topgolf, AMC and Regal represent a significant portion of our total revenue. For the year ended December 31, 2024,2025, total revenues of approximately $100.8$102.3 million or 14.4%14.2% were from Topgolf, approximately $94.4$97.4 million or 13.5%13.6% were from AMC and approximately $76.4$82.8 million or 10.9%11.5% were from Regal. We have diversified and expect to continue to diversify our real estate portfolio by entering into lease transactions or financing arrangements with a number of other tenants or borrowers. If for any reason AMC,Topgolf, TopgolfAMC and/or Regal failed to perform under their lease or mortgage obligations for a significant period of time, or under any modified lease or mortgage obligations, we could be required to reduce or suspend our shareholder dividends or share repurchases and may not have sufficient funds to support operations or service our debt until substitute customers are obtained. If that happened, we cannot predict when or whether we could obtain substitute quality customers on acceptable terms.

To maintain our status as a REIT, we are generally not permitted to directly operate our properties. As a result, from time to time, we enter into management agreements with third-party managers to operate certain properties. ThisWe practiceutilize hasa beenthird mostparty frequentmanager with our experiential lodging properties. However, we also managefor a limited number of theatres formerly operated by our tenants and may manageengage aadditional greaterthird-party numbermanagers in the future if customer defaults or bankruptcies result in our taking back properties. Additionally, we utilize a third party manager for the Kartrite Resort and Indoor Waterpark and two experiential lodging properties. For managed properties, our ability to direct and control how our properties are operated is less than if we were able to manage these properties directly. Under the terms of our management agreements, our participation in operating decisions relating to these properties is generally limited to certain matters. We do not supervise any of these managers or their personnel on a day-to-day basis. We cannot provide any assurances that the managers will manage our properties in a manner that is consistent with their respective obligations under the applicable management agreement or our obligations under any franchise agreements. We could be materially and adversely affected if any of our managers fail to effectively manage revenues and expenses, provide quality services and amenities, or otherwise fail to manage our properties in our best interests, and we may be financially responsible for the actions and inactions of the managers. In certain situations, we may terminate the management agreement. However, we can provide no assurances that we could identify a replacement manager, or that the replacement manager will manage our property successfully. A failure by our third-party managers to successfully manage our properties could lead to an increase in our operating expenses or decrease in our revenue, or both.

We currently use debt to fund portions of our operations and acquisitions. In a rising or elevated interest rate environment, the cost of our existing variable rate debt and any new debt will likely increase.increase or remain higher compared to historical periods. We have used leverage to acquire properties and expect to continue to do so in the future. Although the use of leverage is common in the real estate industry, our use of debt exposes us to some risks. If a significant number of our customers fail to make their lease or interest payments for a significant period of time, the risk of which has been heightened as a result of the generally challenging and uncertain economic environment, and we do not have sufficient cash to pay principal and interest on the debt, we could default on our debt obligations. A small amount of our debt financing is secured by mortgages on our properties and we may enter into additional secured mortgage financing in the future. If we fail to meet our mortgage payments, the lenders could declare a default and foreclose on those properties. We expect that our levels of investment spending will be limited in the near term due to elevated costs of capital.

Most of our financing arrangements require us to make a lump-sum or "balloon" payment at maturity. There can be no assurance that we will be able to refinance such debt on favorable terms or at all, especially in light of higherelevated interest rates and other negative economic conditions. To the extent we cannot refinance such debt on favorable terms or at all, we may be forced to dispose of properties on disadvantageous terms or pay higher interest rates, either of which would have an adverse impact on our financial performance and ability to pay dividends to our shareholders.

We acquire, develop or finance experiential real estate properties. Although we are subject to the general risks inherent in concentrating investments in real estate, the risks resulting from a lack of diversification become even greater as a result of investing primarily in experiential real estate properties. These risks are further heightened by the fact that a significant portion of our investments are in megaplex theatre properties. Although a downturn in the real estate industry could significantly adversely affect the value of our properties, a downturn in the experiential real estate industry could compound this adverse effect. These adverse effects could be more pronounced than if we diversified our investments to a greater degree outside of experiential real estate properties or, more particularly, outside of megaplex theatre properties. Megaplex theatre properties depend on regular production and availability of motion pictures, which were severely disrupted during the COVID-19 pandemic and by the Writers Guild of America and Screen Actors Guild strikes in 2023. The future production and availability of motion pictures may be negatively affected by changes in traditional motion picture release models by studios or motion pictures distributors, as a result of consolidation or otherwise, such as reducing the number of wide release titles or reducing theatrical release windows. As a result, we are subject to more risk associated with megaplex theatres than if we had more diversified investments.

If we fail to qualify as a REIT for U.S. federal income tax purposes, we will be taxed as a corporation. We are organized and believe we qualify as a REIT, and intend to operate in a manner that will allow us to continue to qualify as a REIT. Qualification as a REIT involves the application of highly technical and complex provisions of the Internal Revenue Code of 1986, as amended (the "Internal Revenue Code"), on which there are only limited judicial and administrative interpretations, and depends on facts and circumstances not entirely within our control, including requirements relating to the sources of our gross income. Accordingly, we cannot provide any assurance that we have always qualified and will remain qualified as a REIT in the future. Even a technical or inadvertent violation could jeopardize our REIT qualification. Rents received or accrued by us from our tenants may not be treated as qualifying income for purposes of these requirements if the leases are not respected as true leases or qualified financing arrangements for U.S. federal income tax purposes and instead are treated as service contracts, joint ventures or some other type of arrangement. If some or all of our leases are not respected as true leases or qualified financing arrangements for U.S. federal income tax purposes and are not otherwise treated as generating qualifying REIT income, we may fail to qualify to be taxed as a REIT. Furthermore, our qualification as a REIT will depend on our satisfaction of certain asset, income, organizational, distribution, stockholdershareholder ownership and other requirements on a continuing basis. Our ability to satisfy the asset tests depends upon our analysis of the characterization and fair market values of our assets, some of which are not susceptible to a precise determination, and for which we may not obtain independent appraisals. In addition, future legislation, new regulations, administrative interpretations or court decisions may significantly change the tax laws, the application of the tax laws to our qualification as a REIT or the U.S. federal income tax consequences of that qualification.

Even if we remain qualified for taxation as a REIT under the Internal Revenue Code, we may face other tax liabilities that reduce our funds available for payment of dividends to our shareholders or the repurchase of shares.shareholders.

Even if we remain qualified for taxation as a REIT under the Internal Revenue Code, we may be subject to federal, state and local taxes on our income and assets, including taxes on any undistributed income, excise taxes, state or local income, property and transfer taxes, and other taxes. Also, some jurisdictions may in the future limit or eliminate favorable income tax deductions, including the dividends paid deduction, which could increase our income tax expense. In addition, in order to meet the requirements for qualification and taxation as a REIT under the Internal Revenue Code, prevent the recognition of particular types of non-cash income, or avert the imposition of a 100% tax that applies to specified gains derived by a REIT from dealer property or inventory, we may hold or dispose of some of our assets and conduct some of our operations through our taxable REIT subsidiaries ("TRSs") or other subsidiary corporations that will be subject to corporate level income tax at regular rates. In addition, while we intend that our transactions with our TRSs will be conducted on arm's length bases, we may be subject to a 100% excise tax on a transaction that the Internal Revenue Service ("IRS") or a court determines was not conducted at arm's length. Any of these taxes would decrease cash available for distribution to our shareholders or the repurchase of shares under our share repurchase program.shareholders.

•our TRSs may not directly or indirectly operate or manage a lodging facility, or provide rights to operate or manage a lodging facility under a brand name, other than through an eligible independent contractor,contractor as defined by the Internal Revenue Code;

We may depend on distributions from our direct and indirect subsidiaries to service our debt,debt and pay dividends to our shareholders and repurchase shares.shareholders. The creditors of these subsidiaries, and our direct creditors, are entitled to amounts payable to them before we pay any dividends to our shareholders or repurchase shares.shareholders.

Substantially all of our assets are held through our subsidiaries. We depend on these subsidiaries for substantially all of our cash flow from operations. The creditors of each of our direct and indirect subsidiaries are entitled to payment of that subsidiary's obligations to them, when due and payable, before distributions may be made by that subsidiary to us. In addition, our creditors, whether secured or unsecured, are entitled to amounts payable to them before we may pay any dividends to our shareholders or repurchase shares under our share repurchase program.shareholders. Thus, our ability to service our debt obligations,obligations and pay dividends to holders of our common and preferred shares and repurchase shares depends on our subsidiaries' ability first to satisfy their obligations to their creditors and then to pay distributions to us and our ability to satisfy our obligations to our direct creditors. Our subsidiaries are separate and distinct legal entities and have no obligations, other than limited guaranties of certain of our debt, to make funds available to us.

We face risks associated with security breaches, whether through cyber-attacks or cyber-intrusions over the internet, malware, computer viruses, attachments to e-mails, persons inside our organization or persons with access to systems inside our organization, and other significant disruptions of our information technology ("IT") networks and related systems. The risk of a security breach or disruption, particularly through cyber-attack or cyber-intrusion, including by computer hackers, foreign governments and cyber terrorists, has generally increased as the number, intensity and sophistication of attempted attacks and intrusions from around the world have increased. These risks are further heightened by factors such as developments in artificial intelligence, increased remote working and geopolitical turmoil. Our IT networks and related systems are essential to the operation of our business and our ability to perform day-to-day operations, including the increase in remote access and operations due to reshaping traditional working dynamics. Although we make efforts to maintain the security and integrity of these types of IT networks and related systems, and we have implemented various measures to manage the risk of a security breach or disruption, there can be no assurance that our security efforts and measures will be effective or that attempted security breaches or disruptions would not be successful or damaging. A security breach or other significant disruption involving our IT networks and related systems could disrupt the proper functioning of our networks and systems; result in misstated financial reports, violations of loan covenants and/or missed reporting deadlines; result in our inability to monitor our compliance with the rules and regulations regarding our qualification as a REIT; result in the unauthorized access to, and destruction, loss, theft, misappropriation or release of proprietary, confidential, sensitive or otherwise valuable information of ours or others, which could be used to compete against us or for disruptive, destructive or otherwise harmful purposes and outcomes; require significant management attention and resources to remedy any damages that result; subject us to claims for breach of contract, damages, credits, penalties or termination of certain agreements; or damage our reputation among our tenants and investors generally. Any or all of the foregoing could have a material adverse effect on our financial condition, results of operations, cash flow and ability to make distributions with respect to, and the market price of, our common stock.shares. We may also incur losses in connection with security breaches that exceed coverage limits under our cyber insurance policies. Our service providers, tenants, managers of our properties and other customers and their business partners are exposed to similar risks and the occurrence of a security breach or other disruption with respect to their information technology and infrastructure could, in turn, have a material adverse impact on our results of operations and business.

The value of real estate fluctuates depending on conditions in the general economy and the real estate business. These conditions may also limit our revenues and available cash. Valuations and appraisals of our assets are estimates of fair value and may not necessarily correspond to realizable value. The rents, interest and other payments we receive and the occupancy levels at our properties may decline as a result of adverse changes in any of the factors that affect the value of our real estate. If our revenues decline, we generally would expect to have less cash available to pay our indebtedness,indebtedness and distribute to our shareholders and effect share repurchases.shareholders. In addition, some of our unreimbursed costs of owning real estate may not decline when the related rents decline.

•consequences of any armed conflict involving, or terrorist attack against, the United StatesU.S. or Canada;

Although our lease termsterms, in most cases, obligate the tenants to bear substantially all of the costs of operating the properties and our managers to manage such costs, investing in real estate involves a number of risks, including:

Our entertainment districts in Colorado, New York, California, and Ontario, Canada, and similar properties we may seek to acquire or develop in the future, involve risks not typically encountered in the purchase and lease-back of real estate properties that are operated by a single tenant. The ownership or development of multi-tenant retail centers could expose us to the risk that a sufficient number of suitable tenants may not be found to enable the centers to operate profitably and provide a return to us. This risk may be compounded by the failure of existing tenants to satisfy their obligations due to various factors, including economic downturns or inflation. These risks, in turn, could cause a material adverse impact to our results of operations and business.

Most of our properties must comply with the ADA. The ADA requires that public accommodations reasonably accommodate individuals with disabilities and that new construction or alterations be made to commercial facilities to conform to accessibility guidelines. Failure to comply with the ADA can result in injunctions, fines, damage awards to private parties and additional capital expenditures to remedy noncompliance. Our leases with tenants, financing arrangementarrangements with borrowers and agreements with managers of our properties require them to comply with the ADA.

Compliance with new laws or regulations and investor expectations relating to climate change and climate change disclosure, including compliance with securities lawand any federal or state disclosure requirements, voluntary compliance with independent rating systems and “green” building codes, may require us or our customers to make improvements to our existing properties or result in increased operating costs, thereby impacting the financial condition of our customers and their ability to meet their lease or debt obligations. We cannot give any assurance that other such conditions do not exist or may not arise in the future. The potential impacts of future climate change on our real estate properties could adversely affect our ability to lease, develop or sell such properties. If we are unable to comply with laws and regulations on climate change or implement effective sustainability strategies, our reputation among our customers and investors may be damaged and we may incur fines or penalties.

We may desire to sell properties in the future because of changes in market conditions, poor tenant performance or default of any mortgage we hold, or to avail ourselves of other opportunities. We may also be required to sell a property in the future to meet debt obligations or avoid a default. Specialty real estate projects such as our investments cannot always be sold quickly, and we cannot assure you that we could always obtain a favorable price. In addition, the Internal Revenue Code limits our ability to sell our properties. We may be required to invest in the restoration or modification of a property before we can sell it. The inability to respond promptly to changes in the performance of our property portfolio could adversely affect our financial condition and ability to service our debt,debt and pay dividends to our shareholders and effect share repurchases.shareholders.

•we may face litigation or other claims in connection with, or as a result of, acquisitions, including claims from terminated associates, tenants, former stockholdersshareholders or other third parties;

One of the factors that investors may consider in deciding whether to buy or sell our common shares or preferred shares is our dividend rate as a percentage of our share price, relative to market interest rates. If market interest rates increase,increase or remain elevated, prospective investors may desire a higher dividend rate on our common shares or seek securities paying higher dividends or interest. Higher interest rates would also likely increase our future borrowing costs and potentially decrease funds available for distribution, which could have an adverse effect on the market price of our common shares and possibly our preferred shares.

To the extent any of our customers or their competitors report losses, slower earnings growth, take charges against earnings or enter bankruptcy proceedings, the market price for our shares could be adversely affected. Specifically, the reduced economic activity resulting from the COVID-19 pandemic severely impacted our customers' businesses, financial condition and liquidity and also resulted in one of our largest tenants declaring bankruptcy, which adversely affected the market price for our shares. The market price for our shares could also be affected by any weakness in the performance of REIT stocks generally or weakness in any of the sectors in which our customers operate, any of which may be adversely affected by generally challenging and uncertain economic conditions.

Our future growth will depend in part on our ability to raise additional capital. If we raise additional capital through the issuance of equity securities (directly, in underwritten offerings or through our ATM Program or DSP Plan, or indirectly through convertible or exchangeable securities, warrants or options), the interests of holders of our common shares could be diluted. Any such additional issuances, or the perception that additional equity securities are available for issuance or that such issuances are likely to occur, could materially and adversely affect the market price for our common shares. Likewise, our Board of Trustees is authorized to cause us to issue preferred shares in one or more series, the holders of which would be entitled to dividends and voting and other rights as our Board of Trustees determines, and which could be senior to or convertible into our common shares. Accordingly, an issuance by us of preferred shares could be dilutive to or otherwise adversely affect the interests of holders of our common shares. As of December 31, 2024,2025, our Series C preferred shares are convertible, at each of the holder's option, into our common shares at a conversion rate of 0.43160.4378 common shares per $25.00 liquidation preference, which is equivalent to a conversion price of approximately $57.92$57.10 per common share (subject to adjustment in certain events). Additionally, as of December 31, 2024,2025, our Series E preferred shares are convertible, at each of the holder's option, into our common shares at a conversion rate of 0.48310.4845 common shares per $25.00 liquidation preference, which is equivalent to a conversion price of approximately $51.75$51.60 per common share (subject to adjustment in certain events). Under certain circumstances in connection with a change in control of the Company, holders of our Series G preferred shares may elect to convert some or all of their Series G preferred shares into a number of our common shares per Series G preferred share equal to the lesser of (a) the $25.00 per share liquidation preference, plus accrued and unpaid dividends divided by the market value of our common shares or (b) 0.7389 shares. Depending upon the number of Series C, Series E and Series G preferred shares being converted at one time, a conversion of Series C, Series E and Series G preferred shares could be dilutive to or otherwise adversely affect the interests of holders of our common shares. In addition, we may issue a significant amount of equity securities in connection with acquisitions or investments, with or without seeking shareholder approval, which could result in significant dilution to our existing shareholders.

Our principalprimary long-term business objective is to enhance shareholder value by achieving predictable and increasing Funds From Operations As Adjusted ("FFOAA"), Adjusted Funds From Operations ("AFFO") and dividends per share. OurFFOAA strategyand isAFFO toare focusnon-GAAP onfinancial long-termmeasures investmentsand are defined and reconciled below in the Experientialsection sectortitled that"Non-GAAP benefitFinancial fromMeasures." ourOur growth strategy focuses on acquiring or developing experiential properties in which we maintain a depth of knowledge and relationships, and which we believe offer sustained performance throughoutthrough most economic cycles. See Item 1 - "Business" for further discussion regarding our strategic rationale for our focus on experiential properties.

Our investment portfolio includes ownership of and long-term mortgages on Experiential and Education properties. Substantially all of our owned single-tenant properties are leased pursuant to long-term, triple-net leases,leases under which the tenants typically pay all operating expenses of the property. Tenants at our owned multi-tenant properties are typically required to pay common area maintenance charges to reimburse us for their pro-rata portion of these costs. We also own certain experiential lodging assets structured using traditional REIT lodging structures as discussed in Item 1 - "Business."

ItWe believe our management's knowledge and industry relationships have facilitated opportunities for us to acquire, finance and lease properties. Our strategy has been our strategy to structure leases and financings to ensure a positive spread between our cost of capital and the rentals or interest paid by our tenants. WeTo haveavoid primarilyinitial acquiredlease-up risks and produce a predictable income stream, we typically acquire or developeddevelop newsingle-tenant properties that are pre-leased tounder along-term single tenant or multi-tenant properties with a high occupancy rate.leases. We have also entered into certain joint ventures and provided mortgage note financing.ventures. We intend to continue entering into some or all of these types of arrangements in the foreseeable future.

Historically, our primary challenges hadhave been locating suitable properties, negotiating favorable lease or financing terms (on new or existing properties) and, managing our expanding portfolio as we continued to grow. We believe our management’s knowledge and industryhaving relationshipsa havecost facilitatedof opportunitiescapital forthat allows us to acquire, finance and lease properties. More recently, and as further discussed below, the challenging economic environment has increasedgrow our cost of capital, which has negatively impacted our ability to make investments in thenew near-term.properties Ourbeyond businessthose isfunded subjectprimarily towith afree number of riskscash and uncertainties,disposition including those described in Item 1A - “Risk Factors” of this report.proceeds.

As of December 31, 2024,2025, our total assets were approximately $5.6$5.7 billion (after accumulated depreciation of approximately $1.6$1.7 billion) with properties located in 4443 states and the provinces of Ontario and Quebec, Canada. Our total investments (a non-GAAP financial measure) were approximately $6.9$7.0 billion as of December 31, 2024.2025. See "Non-GAAP Financial Measures" for the reconciliation of "Total assets" in the consolidated balance sheet to total investments and the calculation of total investments at December 31, 20242025 and 2023.2024. We group our investments into two reportable segments, Experiential and Education. As of December 31, 2024,2025, our Experiential investments comprised $6.4$6.6 billion, or 93%,94%, and our Education investments comprised $0.5$0.4 billion, or 7%,6%, of our total investments.

As of December 31, 2024,2025, our Experiential portfolio (excluding property under development, undeveloped land inventory and the threetwo joint venture properties noted below) consisted of the following property types (owned or financed):

As of December 31, 2024,2025, our wholly-owned Experiential real estate portfolio consisted of approximately 18.819.0 million square feet, which includes 0.3 million square feet of vacant properties we intend to sell. The wholly-owned Experiential portfolio, excluding the vacant properties we intend to sell, was 99% leased or operated and included $112.3$54.9 million in property under development and $20.2 million in undeveloped land inventory.

As of December 31, 2024,2025, our wholly-owned Education real estate portfolio consisted of approximately 1.21.1 million square feet, which includes 13 thousand square feet for a vacant property we intend to sell. The wholly-owned Education portfolio, excluding the vacant property we intend to sell,and was 100% leased.

The combined wholly-owned portfolio consisted of 19.720.1 million square feet and was 99% leased or operated excluding the 0.3 million square feet of vacant properties we intend to sell.operated.

ChallengingGeopolitical Economicand International Trade Environment

Our total revenue, net income available to common shareholders per diluted share and Funds From Operations As Adjusted ("FFOAA") per diluted share (a non-GAAP financial measure) are detailed below for the years ended December 31, 20242025 and 20232024 (dollars in millions, except per share information):

•The effect of property acquisitionsinvestments and dispositions that occurred in 20242025 and 20232024;

•The increaserecognition inof lower other income and other expense primarily related to having fewer operating additionalproperties propertiesfor the year ended December 31, 2025 versus the year ended December 31, 2024;

•The increasedecrease in equityprovision infor losscredit fromlosses, jointnet, ventures,impairment charges and impairment charges on joint ventures and provision for creditthe lossesyear ended December 31, 2025 versus the year ended December 31, 2024; and

•The recognition of higher net gain on sale of real estate inand 2024early ground lease termination for the year ended December 31, 2025 versus the recognitionyear ofended netDecember loss31, on2024; sale of real estate in 2023.and

For further details on items impacting our operating results, see section below titled "Results of Operations". FFOAA is a non-GAAP financial measure. For the definitions and further details on the calculationscalculation of FFOAA and certain other non-GAAP financial measures, see section below titled "Non-GAAP Financial Measures."

We are required to make subjective assessments as to whether there are impairments in the value of our real estate investments. These impairment estimates may have a direct impact on our consolidated financial statements. We assess the carrying value of our real estate investments whenever events or changes in circumstances indicate that the carrying amount of a property may not be recoverable. Certain factors may indicate that impairments exist, which include, but are not limited to, under-performance relative to projected future operating results, change in the time period we expect to hold the property, tenant difficulties and significant adverse industry or market economic trends. If an indicator of possible impairment exists, the property is evaluated for impairment by completing the undiscounted cash flow test, which compares the carrying amount of the real estate investment to the estimated future cash flows (undiscounted and without interest charges), including the residual value of the real estate. If an impairment is indicated, we will record a loss for the amount by which the carrying value of the asset exceeds its estimated fair value.

The assumptions used to derive the estimated future cash flows for the undiscounted cash flow test are basedsubjective onand include, but are not limited to, capitalization rates, anticipated future market rent and our anticipated hold period, which are all subjective.period. Market rent assumptions used for the estimated future cash flows and the capitalization rate used to estimate the residual value of the real estate can fluctuate based on economic and industry specific factors. Changes in these assumptions could materially impact the result of the undiscounted cash flow test.test and lead to an impairment loss. If there is a shift in economic conditions, or a change in our property strategy, including a reduction in our anticipated hold period, these changes could materially impact the estimatedresult of the undiscounted cash flowsflow test and also lead to an impairment loss. TheImpairment loss is calculated based upon the difference between the fair value and the carrying value of the property. We generally use the income approach to derive the fair value of the property, which includes estimates for market rent, capitalization rates, and discount rates that are subjective and can be impacted by a lack of comparable transactions. We may also use the sales comparison approach or take into account real estate purchase offers to derive the fair value of the real estate if it is anticipated that the property may be sold.

Upon acquisition of real estate properties, we evaluate the acquisition to determine if it is a business combination or an asset acquisition. Generally, ourOur acquisitions are generally considered asset acquisitions. If an acquisition is determined to be an asset acquisition,acquisitions, and, accordingly, we allocate the purchase price and other related capitalized acquisition costs incurred to the acquired tangible assets and identified intangible assets and liabilities on a relative fair value basis. Typically, relative fair values are based on recent independent appraisals or methods similar to those used by independent appraisers, as well as management judgment. In addition, acquisition-related costs incurred for asset acquisitions are capitalized.

The methods used to derive the relative fair value of the acquired tangible and intangible assets and liabilities generally include the income approach, cost approach and sales comparison approach. The assumptions used in these approaches includeinclude, but are not limited to, estimates for market rent, capitalization rates and discount ratesrates. thatThese estimates are subjective and can be impacted by a lack of comparable transactions. Market rent assumptions, capitalization rates and discount ratesAssumptions used in the valuation of real estate can fluctuate based on economic and industry specific factors.

Our accounts receivable balance is comprised primarily of rents and operating cost recoveries due from tenants as well as accrued fixed rental rate increases to be received over the life of the existing leases. We regularly evaluate the collectability of our 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 of our tenants, historical trends of the tenant, property level metrics, current economic conditions and changes in customer payment terms. We suspend revenue recognition whenWhen the collectability of amountslease duereceivables isor deemedfuture lease payments are no longer probableprobable, andwe record a direct write-off of the outstanding receivable to revenue.rental revenue and recognize future rental revenue on a cash basis.

To determine if the collection of lease receivables is probable, we review our tenants' financial condition, including estimates of their expected future operating results, which are subjective. The tenant's current and estimated future operating results, the tenant's ability to obtain additional financing, as well as the ability and intention to pay lease receivables can vary based on economic conditions and industry specific factors. If economic conditions or the tenant's financial condition or results decline, the anticipated collection of outstanding lease receivables may not be probable and could result in the suspension of accrual revenue recognition and the write-off of theoutstanding lease receivable.receivables.

Our mortgage and notes receivables consist of loans originated by us and the related accrued and unpaid interest income. We regularly evaluate the collectability of our receivables by considering such factors as the credit quality of our borrowers, historical trends of the borrower, our historical loss experience, current portfolio, market and economic conditions and changes in borrower payment terms. We estimate our current expected credit losses on a loan-by-loan basis using a forward-looking commercial real estate forecasting tool. We record provision (benefit) for credit losses, netnet, and reduce our mortgage note and note receivables balances by the allowance for credit losses on a quarterly basis in accordance with ASC 326. In the event we have a past due mortgage note or note receivable and we determine it is collateral dependent, we measure expected credit losses based on the fair value of the collateral. If foreclosure is deemed probable, and we expect to sell rather than operate the collateral, we adjust the fair value of the collateral for the estimated costs to sell.

If a loan is determined to be collateral dependent, the assumptions used to determine the fair value of the underlying collateral vary based on the type of collateral that secures the mortgage or note receivable. The fair value may be impacted based on economic factors, an estimate of future operating cash flows of the collateral and capitalization rates, thatwhich are subjective and can be impacted by a lack of comparable transactions. Changes in these assumptions could materially impact the estimated value of the collateral and lead to increased provision (benefit) for credit losses, net.

The above amounts include $3.5$3.9 million and $3.6$3.5 million in capitalized interest for the years ended December 31, 2024 and 2023,$0.3 respectively,million and $0.2 million in capitalized other general and administrative direct project costs for both the years ended December 31, 20242025 and 2023.2024, respectively. Excluded from the table above are $7.3$5.2 million and $12.4$7.3 million of maintenance capital expenditures and other spending for the years ended December 31, 20242025 and 2023,2024, respectively.

During the year ended December 31, 2024,2025, we completed the salessale of two leased cultural properties, eightthree vacant theatre properties, onetwo operating theatre properties, four leased theatre propertyproperties, one vacant early childhood education center, four land parcels and two10 vacantleased early childhood education centers for net proceeds totaling $74.4$141.8 million.million In connection with these sales, weand recognized a net gain on sale totaling $16.1$36.1 million.

Capital Markets ActivitiesActivity

On•Upon Augustmaturity, 22,on 2024,April 1, 2025, we repaid ourin $136.6full $300.0 million Seriesof Asenior unsecured private placement notes due 2024, using fundsborrowings available onunder our $1.0 billion senior unsecured revolving credit facility.facility;

During•On theSeptember year22, ended December 31, 2024,2025, we entered into aamendment number one to our Fourth Amended, Restated and Consolidated Credit AgreementAgreement, dated as of September 19, 2024 (the "Amended Credit Agreement")., Seeto discussionremove belowthe SOFR index adjustment with respect to loans denominated in LiquidityU.S. and Capital Resources and Note 9 to the consolidated financial statements in this Annual Report on Form 10-K for additional information.dollars;

(31) The increase in straight-line rent forFor the year ended December 31, 20242025 compared to the year ended December 31, 20232024, wasthe dueincrease primarilyin minimum rent resulted from an increase of $11.5 million related to property acquisitions and developments completed in 20242025 and 20232024. andIn straight-lineaddition, there was a net increase in minimum rent receivableof for$8.4 Regalmillion recognizedrelated duringto therental yearrevenue endedon Decemberexisting 31,properties. 2024This was partially offset by a decrease in connectionrental withrevenue reestablishingof accrual$3.5 basismillion accountingfrom forproperty Regal on August 1, 2023.dispositions.

(42) The increase in otherpercentage incomerent (i.e., amounts above base rent) for the year ended December 31, 20242025 compared to the year ended December 31, 20232024 relatedwas due primarily to anhigher increasepercentage inrent operating incomerecognized from theour additiontheatre tenants, one of fiveour operatingearly theatrechildhood propertieseducation incenter the third quarter of 2023 that were previously leased by Regal. One of these properties closed on September 20, 2024tenants and isfrom currentlyour vacantattraction as we prepare to sell it.tenants.

(53) The increasedecrease in mortgage and other financing income duringfor the year ended December 31, 20242025 compared to the year ended December 31, 20232024 related primarily to interesta decrease in operating income on new mortgage notes funded in 2024 and 2023 and from additionalthree investmentsoperating ontheatre existingproperties mortgage(including noteone receivables.that became vacant prior to sale) that were sold during the year ended December 31, 2025.

(1) The increasedecrease in other expense for the year ended December 31, 20242025 compared to the year ended December 31, 20232024 related primarily to thea additiondecrease ofin operating expenseexpenses from fivethree operating theatre properties (including one that became vacant prior to sale) that were previouslysold leasedduring bythe Regal.year Oneended ofDecember these31, properties closed on September 20, 2024 and is currently vacant as we prepare to sell it.2025.

The following discussion should be read in conjunction with the consolidated financial statements and notes thereto included in this Quarterly Report on Form 10-Q of EPR Properties (the “Company”, “EPR”, “we” or “us”). The forward-looking statements included in this discussion and elsewhere in this Quarterly Report on Form 10-Q involve risks and uncertainties, including anticipated financial performance, anticipated liquidity and capital resources, business prospects, industry trends, shareholder returns, performance of leases by tenants, performance on loans to customers and other matters, which reflect management's best judgment based on factors currently known. See “Cautionary Statement Concerning Forward-Looking Statements,” which is incorporated herein by reference. Actual results and experience could differ materially from the anticipated results and other expectations expressed in our forward-looking statements as a result of a number of factors, including but not limited to those discussed in Part II, Item 1A - "Risk Factors" in this Quarterly Report on Form 10-Q and Item 1A - "Risk Factors" in our 2025 Annual Report.

As of MarchJune 31,30, 2026, our total assets were approximately $5.7$6.1 billion (after accumulated depreciation of approximately $1.8 billion) with properties located in 4243 states and Canada. Our total investments (a non-GAAP financial measure) were approximately $7.1$7.5 billion as of MarchJune 31,30, 2026. See "Non-GAAP Financial Measures" for the reconciliation of "Total assets" in the consolidated balance sheet to total investments at MarchJune 31,30, 2026 and December 31, 2025. We group our investments into two reportable segments, Experiential and Education. As of MarchJune 31,30, 2026, our Experiential investments comprised $6.7$7.1 billion, or 94%,95%, and our Education investments comprised $0.4 billion, or 6%,5%, of our total investments.

As of MarchJune 31,30, 2026, our Experiential portfolio (excluding property under development, undeveloped land inventory and two joint venture properties) consisted of the following property types (owned or financed):

As of MarchJune 31,30, 2026, our wholly-owned Experiential real estate portfolio consisted of approximately 19.219.5 million square feet, was 99% leased or operated and included $23.4$10.0 million in property under development and $20.2 million in undeveloped land inventory.

As of MarchJune 31,30, 2026, our Education portfolio consisted of the following property types (owned or financed):

As of MarchJune 31,30, 2026, our wholly-owned Education real estate portfolio consisted of approximately 1.1 million square feet and was 100% leased.

Recent geopolitical events and macroeconomic trends, including evolving global armed conflicts and significant changes in U.S. and international trade policies, have produced heightened uncertainty. This uncertainty could weaken economic conditions, contribute to inflation, increase borrowing costs and decrease consumer spending. TariffGlobal increasestrade uncertainty and supply chain disruptions may impact our business by increasing the cost of construction materials, which in turn may lead to higher development and renovation expenses. This increase in costs may result in reduced yields on development projects and potentially delay or result in cancelled planned projects. Additionally, our tenants and their customers are similarly experiencing these uncertainties, which could negatively affect their financial resources and ability to satisfy their obligations to us.

Our total revenue, net income available to common shareholders per diluted share and FFOAA per diluted share are detailed below for the three and six months ended MarchJune 31,30, 2026 and 2025 (in millions, except per share information):

The major factors impacting our results for the three and six months ended MarchJune 31,30, 2026, as compared to the three and six months ended MarchJune 31,30, 2025 were as follows:

•The effect of investments and dispositions that occurred in 2026 and 2025 as well as contractual increases in rent and interest related to existing investments;

•The recognition of lower other income and other expense primarily related to having fewer operating properties for the three and six months ended MarchJune 31,30, 2026 versus the three and six months ended MarchJune 31,30, 2025;

•The recognition of higher retirement and severance expense for the threesix months ended MarchJune 31,30, 2026 versus the threesix months ended MarchJune 31,30, 2025;

•The increase in the benefit for credit losses, net for the threesix months ended MarchJune 31,30, 2026 versus the threesix months ended MarchJune 31,30, 2025; and

•The recognition of lower gain on real estate transactions for the three and six months ended MarchJune 31,30, 2026 versus the three and six months ended MarchJune 31,30, 2025.2025; and

The preparation of financial statements in conformity with accounting principles generally accepted in the United States (“GAAP”) requires management to make estimates and assumptions in certain circumstances that affect amounts reported in the accompanying consolidated financial statements and related notes. In preparing these financial statements, management has made its best estimates and assumptions that affect the reported assets and liabilities and the reported amounts of revenues and expenses during the reporting period. The most significant assumptions and estimates relate to the valuation of real estate, accounting for real estate acquisitions, assessing the collectability of receivables and the credit loss related to mortgage and other notes receivable. Application of these assumptions requires the exercise of judgment as to future uncertainties and, as a result, actual results could differ from these estimates. A summary of critical accounting policies and estimates is included in our 2025 Annual Report. For the threesix months ended MarchJune 31,30, 2026, there were no changes to critical accounting policies.

Our investment spending during the threesix months ended MarchJune 31,30, 2026 and 2025 totaled $51.3$492.2 million and $37.7$86.3 million, respectively, and is detailed below (in thousands):

The above amounts include $0.4$0.6 million and $1.5$2.4 million in capitalized interest and $46$81 thousand and $39$175 thousand in other general and administrative direct project costs for the threesix months ended MarchJune 31,30, 2026 and 2025, respectively. Excluded from the table above is approximately $0.2$0.7 million and $1.3$3.1 million of maintenance capital expenditures for the threesix months ended MarchJune 31,30, 2026 and 2025, respectively.

During the threesix months ended MarchJune 31,30, 2026, we exercised our purchase option to convert a $70.0 million mortgage note receivable secured by an experiential lodging property in Tennessee into a wholly-owned rental property subject to a long-term triple-net lease. In connection with this conversion, we recognized a gain on real estate transactions of approximately $1.0 million and a benefit for credit losses of approximately $1.3 million.

On March 2, 2026, our Executive Vice President and Chief Investment Officer, Greg Zimmerman, retired from his position. The role of Executive Vice President and Chief Investment Officer has been assumed by Ben Fox, who joined us in August of 2025. During the threesix months ended MarchJune 31,30, 2026, we recorded retirement and severance expense related to Mr. Zimmerman's retirement totaling $1.4 million, which included cash payments totaling $0.4 million and accelerated vesting of nonvested shares totaling $1.0 million.

Debt and Capital Markets Activities

During the threesix months ended MarchJune 31,30, 2026, we entered into a forward sales agreementagreements pursuant to our "at-the-market" offering program ("ATM Program") to sell an aggregate of 797,4221,189,884 common shares for initial gross proceeds of $47.5$70.9 million upon settlement,million, or an average forward price of $59.52$59.58 per share, subject to adjustment.adjustment upon settlement. We have the option to settle the outstanding common shares any time before the maturitymaturities of the respective forward sales agreementagreements beginning on March 1, 2027 through June 30, 2027, subject to customary closing conditions, for the initial gross proceeds as adjusted for payment of commissions and applicable dividends as well as a daily adjustment based on the overnight bank borrowing rate less a spread. As of MarchJune 31,30, 2026, we have $352.5$329.1 million of remaining capacity under our ATM Program.Program and expected net proceeds of unsettled forward sales agreements totaling $69.5 million.

Three and six months ended MarchJune 31,30, 2026 compared to the three and six months ended MarchJune 31,30, 2025

(1) For the three months ended MarchJune 31,30, 2026 compared to the three months ended MarchJune 31,30, 2025, the increase in minimum rent resulted from an increase of $6.6$14.8 million related to property acquisitions and developments completed in 2026 and 2025. In addition, there was a net increase in minimum rent of $3.8$3.4 million related to existing properties. This was partially offset by a decrease in rental revenue of $1.2$0.5 million from property dispositions.

During the threesix months ended MarchJune 31,30, 2026, we renewed twofour lease agreements on a ski property.property and two attraction properties. We had no change in rental rates and paid no leasing commissions with respect to these lease renewals.

(32) The decrease in other income for the threesix months ended MarchJune 31,30, 2026 compared to the threesix months ended MarchJune 31,30, 2025 related primarily to a decrease in operating income from two operating theatre properties that were sold during the threesix months ended MarchJune 31,30, 2025.

(1) The decrease in other expense for the threesix months ended MarchJune 31,30, 2026 compared to the threesix months ended MarchJune 31,30, 2025 related primarily to a decrease in operating expense from two operating theatre properties that were sold during the threesix months ended MarchJune 31,30, 2025.

(2) Retirement and severance expense for the threesix months ended MarchJune 31,30, 2026 related to the retirement of our former Executive Vice President and Chief Investment Officer. There was no retirement and severance expense for the threesix months ended MarchJune 31,30, 2025.

(3) The change in provision (benefit) for credit losses, net for the threesix months ended MarchJune 31,30, 2026 compared to the threesix months ended MarchJune 31,30, 2025 was due to a credit loss benefit of $1.3 million recognized in connection with the conversion of a $70.0 million mortgage note receivable to a wholly-owned rental property during the six months ended June 30, 2026, and changes in our estimated current expected credit losses primarily due to improved property level performance and improved macro-economic conditions.

(4) The increase in depreciation and amortization for the threesix months ended MarchJune 31,30, 2026 compared to the threesix months ended MarchJune 31,30, 2025 resulted from acquisitions and developments completed in 2026 and 2025. This was partially offset by property dispositions that occurred during 2025.

(5) The gain on real estate transactions for the threesix months ended MarchJune 31,30, 2026 related to the conversion of a $70.0 million mortgage note receivable into a wholly-owned rental property. The gain on real estate transactions for the threesix months ended MarchJune 31,30, 2025 related to the sale of onetwo vacant theatre property,properties, two operating theatre properties, two leased theatre properties, one vacant early childhood education center and 10 early childhood education centers.

(6) The increase in interest expense, net for the three and six months ended MarchJune 31,30, 2026 compared to the three and six months ended MarchJune 31,30, 2025 resulted from a decrease in capitalized interest and an increase in average borrowings. This was partially offset by an increase in interest income recognized on short-term investments.

Cash and cash equivalents were $68.5$16.2 million at MarchJune 31,30, 2026. In addition, we had restricted cash of $6.1$4.4 million at MarchJune 31,30, 2026, which related primarily to escrow deposits required for property management, mortgage note and debt agreements or held for potential acquisitions, developments and redevelopments.

Mortgage Debt, Senior Notes and Unsecured Revolving Credit FacilityAgreement

At MarchJune 31,30, 2026, we had total debt outstanding of $2.9$3.3 billion, of which 99% was unsecured.

At MarchJune 31,30, 2026, we had outstanding $2.75 billion in aggregate principal amount of unsecured senior notes (excluding the private placement notes discussed below) ranging in interest rates from 3.60% to 4.95%. The notes contain various covenants, including: (i) a limitation on incurrence of any debt that would cause the ratio of our debt to adjusted total assets to exceed 60%; (ii) a limitation on incurrence of any secured debt that would cause the ratio of secured debt to adjusted total assets to exceed 40%; (iii) a limitation on incurrence of any debt that would cause our debt service coverage ratio to be less than 1.5 times; and (iv) the maintenance at all times of our total unencumbered assets such that they are not less than 150% of our outstanding unsecured debt. Interest payments on our unsecured senior notes are due semiannually.

At MarchJune 31,30, 2026, we had outstanding $179.6 million of Series B senior unsecured notes that were issued in a private placement transaction and are due on August 22, 2026. At MarchJune 31,30, 2026, the interest rate for these Series B private placement notes was 4.56%.

OurAt June 30, 2026, our unsecured revolving credit facility and the private placement notes contain financial covenants or restrictions that limit our levels of consolidated debt, secured debt, investments outside certain categories, share repurchases and dividend distributions and require us to meet certain coverage levels for fixed charges and debt service. Additionally, these debt instruments contain cross-default provisions if we default under other indebtedness exceeding certain amounts. Those cross-default thresholds vary from $50.0 million to $75.0 million, depending upon the debt instrument. We were in compliance with all financial and other covenants under our consolidated debt instruments at MarchJune 31,30, 2026.

In 2024, two experiential lodging properties located in St. Pete Beach, Florida, in which we hold unconsolidated equity investments, were severely damaged by two hurricanes. One of these properties was sold during the six months ended June 30, 2026 and all proceeds went into the receivership. We continue to work in good faith with our joint venture partners, the non-recourse debt provider and the insurance companies to identify a path forward in which we expect to result in the eventual removal of the unconsolidated equity investments in thesethe remaining experiential lodging propertiesproperty and the related non-recourse debt from our portfolio. Accordingly, we determined that our investment in these joint ventures had no fair value and was not recoverable, and during the year ended December 31, 2024, we recognized $12.1 million in other-than-temporary impairment charges on joint ventures related to these equity investments.recoverable. There can be no assurance as to the ultimate outcome of our negotiations regarding our exit from these joint ventures.

As discussed above, during the threesix months ended MarchJune 31,30, 2026, we entered into a forward sales agreementagreements pursuant to our "at-the-market" offering program ("ATM Program") to sell an aggregate of 797,4221,189,884 common shares for initial gross proceeds of $47.5$70.9 million upon settlement,million, or an average forward price of $59.52$59.58 per share, subject to adjustment.adjustment upon settlement. We have the option to settle the outstanding common shares any time before the maturity dates of the respective forward sales agreementagreements beginning on March 1, 2027 through June 30, 2027, subject to customary closing conditions, for the initial gross proceeds as adjusted for payment of commissions and applicable dividends as well as a daily adjustment based on the overnight bank borrowing rate less a spread. As of MarchJune 31,30, 2026, we have $352.5$329.1 million of remaining capacity under our ATM Program.Program and expected net proceeds of unsettled forward sales agreements totaling $69.5 million.

As of MarchJune 31,30, 2026, we had 1624 development projects with commitments to fund an aggregate of approximately $37.5$46.4 million, of which approximately $20.9$18.3 million is expected to be funded in the remainder of 2026. Development costs are advanced by us in periodic draws. If we determine that construction is not being completed in accordance with the terms of the development agreement, we may discontinue funding construction draws. We have agreed to lease the properties to the operators at pre-determined rates upon completion of construction.

We have certain commitments related to our mortgage notes investments that we may be required to fund in the future. We are generally obligated to fund these commitments at the request of the borrower or upon the occurrence of events outside of our direct control. As of MarchJune 31,30, 2026, we had two mortgage notes with commitments totaling approximately $46.7$46.2 million, all of which is expected to be funded in the remainder of 2026. If commitments are funded in the future, interest will be charged at rates consistent with the existing investments.

We currently anticipate that our cash on hand, cash from operations, funds available under our $1.0 billion senior unsecured revolving credit facilityfacility, funds available under our $600.0 million senior unsecured delayed draw term loan facility, proceeds from issuances under our ATM Program and proceeds from asset dispositions will provide adequate liquidity to meet our financial commitments, including the amounts needed to fund our operations, make recurring debt service payments, allow distributions to our shareholders and avoid corporate level federal income or excise tax in accordance with REIT Internal Revenue Code requirements.

Our primary use of cash after paying operating expenses, debt service, distributions to shareholders and funding existing commitments is in growing our investment portfolio through acquiring, developing and financing additional properties. We expect to finance these investments with cash on hand, excess cash flow, proceeds from asset dispositions or borrowings under our unsecured revolving credit facility as well as debt and equity financing alternatives. If we borrow the maximum amount available under our $1.0 billion senior unsecured revolving credit facility and $600.0 million senior unsecured delayed draw term loan facility, there can be no assurance that we will be able to obtain additional or substitute investment financing. We may also assume mortgage debt in connection with property acquisitions. The availability and terms of any such financing or sales will depend upon market and other conditions.

The following table summarizes our FFO, FFOAA and AFFO including per share amounts for FFO and FFOAA, for the three and six months ended MarchJune 31,30, 2026 and 2025 and reconciles such measures to net income available to common shareholders, the most directly comparable GAAP measure (unaudited, in thousands, except per share information):

The effect of the conversion of our convertible preferred shares is calculated using the if-converted method and the conversion, which results in the most dilution is included in the computation of per share amounts. The conversion of the 5.75% Series C cumulative convertible preferred shares and the 9.00% Series E cumulative convertible preferred shares would be dilutive to FFO, FFOAA and AFFO per share for the three and six months ended MarchJune 31,30, 2026 and 2025. Therefore, the additional common shares that would result from the conversion and the corresponding add-back of the preferred dividends declared on those shares are included in the calculation of diluted FFO and FFOAA per share and would be included in a calculation of AFFO per share.