EPR Properties(US:EPR)2021-02-24 16:00Investments Overview - Total investments as of December 31, 2020, were approximately $6.5 billion, with Experiential investments comprising $5.9 billion (91%) and Education investments at $0.6 billion (9%) [26][27]. - The Education segment included total investments of approximately $0.6 billion, with 100% leasing of the owned real estate portfolio of approximately 1.4 million square feet [61]. Real Estate Portfolio - The owned Experiential real estate portfolio was approximately 19.3 million square feet, with a leasing rate of 93.8% and included $57.6 million in property under development [32]. - The company aims to diversify its asset base by property type, geographic location, and tenant or customer [79]. Revenue Contributions - For the year ended December 31, 2020, total revenue from Cinemark, AMC, and Regal was approximately $42.1 million (10.1%), $30.0 million (7.2%), and $13.1 million (3.1%) respectively [40]. - Topgolf contributed approximately $80.7 million, or 19.5% of the total revenue for the year ended December 31, 2020 [42]. Growth Strategy - The company aims to build a premier experiential REIT focused on real estate venues that facilitate out-of-home leisure and recreation experiences [63]. - The growth strategy focuses on acquiring or developing experiential real estate venues, targeting opportunities that create value through leisure and recreation experiences [65]. - The company plans to continue developing and redeveloping properties consistent with its growth strategies, requiring signed leases before development [75]. Financial Performance and Stability - The company’s long-term objective is to enhance shareholder value by achieving predictable and increasing Funds From Operations As Adjusted (FFOAA) and dividends per share [64]. - The pandemic has temporarily impeded growth, but the company expects to return to growth as customer businesses recover and cash flows stabilize [69]. - The company emphasizes long-term leases for single-tenant properties to minimize lease-up risks and produce predictable income streams [70]. - The leasing arrangements are structured to achieve a positive spread between the cost of capital and rents paid by tenants, typically on a triple-net basis [71]. Dividend and Financial Management - The company temporarily suspended its monthly cash dividend to common shareholders in May 2020, with plans to reinstate dividends when conditions allow [87]. - The company must distribute at least 90% of its taxable income to maintain its REIT status [96]. Debt and Credit Facilities - As of December 31, 2020, the company had a $1.0 billion unsecured revolving credit facility with $590.0 million outstanding, and paid down $500.0 million subsequently [400]. - The company has a total estimated fair value of debt of $3.14 billion as of December 31, 2020 [404]. - The average interest rate for fixed-rate debt as of December 31, 2020, was 4.67% [404]. - The company has a 65% investment interest in two unconsolidated real estate joint ventures with a secured mortgage loan of $85.0 million, bearing interest at a minimum of 6.00% [401]. Risk Management - The company is exposed to foreign currency risk with four Canadian properties, utilizing fixed-to-fixed cross-currency swaps with a notional value of $200.0 million CAD [405]. - During the year ended December 31, 2020, the company entered into three USD-CAD cross-currency swaps with a total fixed original notional value of $100.0 million CAD and $76.6 million USD [406]. - The joint venture related to the two lodging properties received a three-month interest deferral due to the COVID-19 pandemic [401]. - The company is subject to various federal, state, and local regulatory requirements that may involve significant unanticipated expenditures [97]. - The company’s gaming facilities are subject to pervasive regulations impacting its gaming tenants and associated operations [96]. Community Support - The company raised over $47,000 through the "EPRcares" initiative to support local front-line workers during the COVID-19 pandemic [95]. Market Conditions - The ski properties were minimally impacted by the pandemic, with expectations for strong performance in 2021 due to their outdoor nature and convenient locations [49]. - Cultural investments have reopened after pandemic-related closures, with expectations for demand to return in a post-pandemic environment [57].