Financial Data and Key Metrics Changes - The company's adjusted FFO for the quarter was $1.26 per share, an increase from $1.22 in the prior year, representing a growth of 3.3% [18] - AFFO for the quarter was $1.24 per share compared to $1.20 in the prior year, also reflecting a 3.3% increase [18] - Total revenue for the quarter was $178.1 million, up from $173.1 million in the prior year [18] - Rental revenue increased by $5.3 million year-over-year, primarily due to investment spending and higher percentage rents [19] Business Line Data and Key Metrics Changes - The experiential portfolio comprises 274 properties, accounting for 94% of total investments, which stood at approximately $6.5 billion [8] - The education portfolio consists of 55 properties, all of which were 100% leased at the end of the quarter [8] - The box office in Q2 was $2.7 billion, a 37% increase compared to Q2 2024, driven by strong performing titles [9] Market Data and Key Metrics Changes - The North American box office for the first half of the year was $4.1 billion, a 15% increase over 2024 [11] - The company estimates the North American box office for the calendar year 2025 to be between $9.3 billion and $9.7 billion [11] Company Strategy and Development Direction - The company is focusing on a disciplined approach to capital allocation and has a robust pipeline of opportunities, including over $100 million committed to experiential development and redevelopment projects [5] - The strategy includes capital recycling to position the portfolio with productive and diversified experiential assets [6] - The company is particularly bullish on the fitness and wellness space, anticipating high-quality opportunities for acquisition and development [16] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism regarding the box office recovery and consumer demand for theatrical exhibitions, with expectations for the Regal master lease to meet percentage rent expectations [7] - Despite macroeconomic pressures, the company believes its differentiated strategy provides resilience and opportunity [7] - Management noted that the cost of capital has improved, allowing for a more aggressive growth posture in pursuing new opportunities [5] Other Important Information - The company sold a vacant former Regal Theater to Costco for net proceeds of $24 million, demonstrating the value of good real estate [17] - Year-to-date, the company has sold approximately $130 million of assets and revised its 2025 disposition guidance to a range of $130 million to $145 million [18] Q&A Session Summary Question: Is there a significant amount of assets for sale at reasonable prices? - Management indicated that there are still robust opportunities in the market, with over half of the pipeline being acquisitions, while being discerning in capital deployment [30][31] Question: How are dispositions planned for the back half of the year? - Management stated that they are close to achieving their targeted disposition range and will continue to look for opportunities to lower theater exposure [34][36] Question: How is the balance sheet strategy being approached? - Management highlighted flexibility in the balance sheet, with plans for a bond transaction to reduce line balance and prepare for upcoming maturities [40][41] Question: What is the demand for core assets? - Management noted that there is increasing interest in the theater space, with more activity and acceptance of it as an asset class [45] Question: How does the company view its exposure to Six Flags? - Management expressed confidence in their relationship with Six Flags, noting that the company is rationalizing its fleet and creating opportunities for accretive transactions [98]