EPR Properties (EPR) 23 Feb 232022 Q4 Earnings call transcript

Good day, and thank you for standing by. Welcome to the Quarter 4 EPR Properties Earnings Conference Call. [Operator Instructions]. Please be advised that today's conference is being recorded.

I would now like to hand the conference over to Brian Moriarty. ahead. go Please

and Thanks and quarter Chris. Participants us for Peterson, and today today's and Vice Thank and CIO; year-end for XXXX fourth Mark CEO; Chairman Silvers, and are Vice webcast. Zimmerman, earnings our Executive call President President you, Executive Greg joining Greg CFO. call on and

and identified as start call by Securities Discussion materially may forward-looking on be, statements as the those statements statements. of from forward-looking those the believe, the company's materially are contained factors hope, XX-Q. from informing Private call may, those in words company's cause operations We'll anticipate comparable defined Act filings, reports results financial differ company's may the including that Litigation by intend, the continue, XXXX, vary to or Form forward-looking contemplated of by include condition will terms. SEC you and such that such actual in could XX-K expect, of this The results other

call included and this to X-K. most believe certain company's SEC non-GAAP the evaluating of references will earnings today's measures A to furnished we reconciliation in useful GAAP are comparable measures performance. to are directly these supplemental measures the Form information in release which contain the Additionally, under

Investor you to page the Center the presentation of today's follow available earnings along, are release, website, If on wish call supplemental and earnings company's www.eprkc.com.

Silvers. to over I'll Greg turn call the Now

earnings today's and Good quarter Brian. webcast. and Thank you, XXXX us you morning, everyone, call fourth joining thank and year-end for on

the investments. demonstrating XX% as resilience our and per recovery For share the growth adjusted, delivered experiential full of our FFO year, continuing we in

to coverage. strength non-theater our rent levels support This our coverage resilience to properties. continues drive fears, backdrop and rent the the theater of experiential continued improving against consumer recession of also affordable the in is our Even reflected

are the received deferral working all from Regal and XXXX, scheduled fourth we are that through as payments toward resolution. process We quarter a February and rent pleased in through also the we have

the to Our which XXXX. ingredient be momentum. up films continue major continues studios of more number reasserted release healthy ticket by at office, box the to and evident releases. in particularly cells grown, tenant was as industries have their XX% release wide demonstrate the key have have Sustained wide success for on content This grown focus is theatrical than

validate investment identify, the year, disciplined our in deploying years manner in pandemic, spending, underwrite experiential resumed to a nearly the XXXX space. X of also investment close variety our ability our a quality experiential and During spending we during across our properties. After capital transactions for in efforts pausing the

million valued and For in XXXX the $XXX deployed with the year, and we XXXX closed over million balance $XXX being being over transactions deployed at XXXX. in

rate the cap We on to capital without investments commitments fund over are able and raising average X%. additional these was these

we've in As tenants the of majority and our partners. the through past, network of stated vast our investments come

community of Our burgeoning depth expansion new with and In such and the fitness partnership Colorado-based SPAs time-tested as natural was areas and experience climbing knowledge REITs. experiential spring opportunities among our new gyms, investing Gravity of House. and unmatched the is the by evidenced real of this in estate breadth hot XXXX, our wellness, the wellness of in

portfolio we with in with continue In our expect expanding XXXX, consistent our strategy. experiential to growth select properties investments

of continue as remains customers. robust to the to pipeline experience-focused growth existing clients new their and demands Our meet concepts grow and

one not of our that remains of opportunity properties. as has our recovered not Our quickly challenge as cost rather capital

approach, in focusing steadfast our highest and best disciplined remain will, on the the quality risk-to-reward investments. We however,

bankruptcy guidance proceeding. At this the time, uncertainty we Regal's aren't providing to due earnings of

monthly outlook and level. shareholders our maintaining remain dividend are common well-covered we current However, to at our in confident its

resolute remain in by heartened to still of work our full and our have our do momentum, are regain we we the properties. confident we and significant quality to While progress,

Lastly, I'm expertise experiential experience from real wealth and expand our net Trustees. of assets. portfolio of pleased to continue estate, brings lease of a Board as welcome we and Case knowledge benefit our excited in his to John grow to and John to we are

Greg I'll Now the who cover Zimmerman, detail. in turn greater will business call over to our

billion, Thanks, Greg. investments were approximately total our At year-end, service XXX leased. and $X.X properties in with XX%

the acquisition project was $XX.X for quarter, an spending redevelopment the for existing was in and for the and spending additional XXX% our investment XXXX the to spending During experiential our of of bringing million, a total million. $XXX.X portfolio, financing asset. investment included

investments and accounts total was experiential Our for the and occupied. or billion, portfolio XX% of XX operators of $X.X end quarter with XX% at comprises our approximately properties, XXX the

Our XX quarter, at was comprises XXX% of the with education the operators, and end properties occupied. portfolio X

compelling Our have families. proposition provide we to we they for on a from destinations To will value-oriented drive-to meaningful seen impact inflation, our confident resilient. not continue value remain date, operators prove and

trailing September office coverage Turning Overall Trailing X.Xx billion for months to most coverage. portfolio strong $X.X data is to XX is same at trailing the coverage XX-month based be at provided Xx. the The box for with XX-month on continues theaters period. a for recent period.

the for portion X.Xx. of non-theater portfolio our is coverage XX-month Trailing

you office billion $X.X office billion to Now I'll total status QX the on XXXX in of American update box was $X.X for $X.X tenants. Total XXXX. box billion. operating North compared our was

are pandemic available X Three the American is the films and box portfolio out. favorably very to after North pictures strong office responding released prove are theater highest theatrically, all When the time. among of outperform industry. results continues high-quality public the grossing it top the films Our

#X million. opened The is December #X million Spider-Man No $XXX XX, Water, on and at date. to $XXX at is Way #X which Gun is $XXX Home Avatar: Way of Top million. And Maverick at

XXXX of generated The weekend. office over office The Day in opened the which February X titles, Wasp, XX could in $XXX and top which North anticipating million each and eagerly exceed million President's are Quantumania, are slate. announced domestic We Man $XXX box Ant the holiday American box

Mermaid, Aquaman Little X, X Galaxy Captain Marvel the X. of Guardians and

benefit consumers office to returning the ages are and and to They of As screen. the post on theatrical are run economic increased demonstrates, all still big of recovering films the on theatrical theater. good to box see COVID. refocused a production Studios when want exhibition see, movies there have recognize the

We films of the will supply to for confident release theatrical that continue grow. remain

Cineworld for of As X, on United in for bankruptcy protection District disclosed, States September filed XXXX, Texas. Southern the previously Bankruptcy Court the

payments, months, We September December, court entire January payments due those January received October, our we received stubborn have payments also February. November, rent and February ordered December, in deferred in with have rent and the and along

Cineworld. not bankruptcy process the beyond about Because comment those updates, we will is ongoing,

to other Turning our customer update major on now an groups.

our demand segments results destinations. of and across all drive-to consumer value-oriented We continue to good see ongoing

attractions continued up Play cultural increased performance Eat XX% assets post-pandemic EBITDARM over Many revenue attendance & up portfolio Our strong and revenue with in of had their versus our for XXXX. and XXXX the year. portfolio and XXXX prior XX%

but increased assets Primarily strong. had lower EBITDARM, labor performance remained costs, several because of

with upward pleased St. Monica momentum. We and of Museum City are particularly performance in continue their the the Santa post-CoVID Louis. Both

shop our construction exceeded Both years Forge. season and Canadian and opened Pigeon and The Water projections XX. EBITDARM Park, Calypso will under to record attendance, and X on museums at our Revenue parks, revenue March were Chocolate X attendance in close and Titanic the on had the expectations Hotel Titanic for add January and for

construction to springs of center expansion for natural and of anticipate and the in conference see both resorts. QX hot strong into the the occupancy continue ADR at the redevelopment growth springs Springs We the commencing a Resort. We

grow fitness strong. ski our our is has In pre-pandemic the to portfolio numbers membership revenue with portfolio, season through exceeded XXXX-'XX continuing Midway year-over-year. performance across

F&B Visits are QX XXXX. QX were up levels revenue some the outlets, staffing season. closed normal to up, in services, from including significantly both intermittently was XXXX-XXXX are which returning of resorts from

quite has favorable. Room Resort Good still Northstar. resort Alaska. in renovations early season while further which Season the snowfall as performance strong, are leading And underway been snowfall in the Alaska, East will helped Four strengthen in wasn't at

approximate Nashville excellent of had metrics. to all increases with Our destinations XXXX Margaritaville an Nashville's all downtown famous in significant Hotel

at that complete, Now Beachcomber seeing renovations bellwether and resorts RevPAR stronger we're ADR and the numbers. St. in both Petersburg

our Brow RV successful our in and go As to RV very X, rebranded Margaritaville Margaritaville Camp of Palms January Pigeon Camp to Resort we along Bridge Cajun with Forge. Resort Lodge

portfolio X% education in the X% XX% revenue, Our year-over-year to portfolio through continues and across with well enrollment. increases in perform in EBITDARM of QX

quarter on which KinderCare QX, a la As enhancement. we credit our call, during Creme, view acquired Creme de as last noted

sale we QX, annual received as Creme de KinderCare termination During the right Creme. X $X rent. contractual of million million la will We in payment anticipate that with in for in representing early a preexisting $X.X connection participation lease education properties QX a execute

to plans proceeds experiential in have X assets. redeploy the sell We and properties all

contractual reduction contain January leases adjustment performance, partially based KinderCare offset on rent we terminations. will remaining which based XXXX, X, effective the rent anticipated anticipate on The

update quick recycling. a to on Turning capital

million $X quarter, we net theater gain a and $XXX,XXX. a vacant of sold of During recognized proceeds for the

with remaining We on our parties X theaters. multiple continue discussions vacant

$XX.X public we was call, million. spending details $XX partner but our give we QX, we noted our a to mortgage with a closed investment of on new couldn't announcement. financing long-term our million commitment On for that to provide QX up expansion in the existing QX, project, in During early pending customers'

popular fund October Christmas of from Michigan, lodge X.X at in the of in can. world's Located tourist X and events festivals. we annual Now indoor Frankenmuth, million in store Bavaria. visitors, for Barbarian leading With attractions the The annual largest and the Detroit, investment one other many little is hours its addition Michigan's known Michigan's Frankenmuth will it's an park water Fest,

Travel the very lodge the property. we the XX and are in to Bavarian Leisure family recently participate The X family years, has of expand towns America. Zender top XX with for nearly this operated winter iconic beautiful Frankenmuth named to most excited and in

In new approximately House, mortgage million Winter and by by wellness million for Steamboat Springs, X Breckenridge, operated $XX.X Vail, secured Aspen, partnership Gravity properties of and Park $XX.X fitness addition, we an in in commitment financing a funded

a fitness, dining We've model outstanding finance is to and club also experiential concept cutting-edge locations. growth. House providing lodging into relationship and a entered Gravity future agreement wellness,

Southwest. Gravity ability our experiential source Traveler, the XXth unique the Gravity named Condinast best demonstrate House Breckenridge, relationships new hotel We're and House. in to delighted partner these curate industry-leading with to opportunities. Both recently

in continuing we a Finally, Cosy with partnership Pittsburgh, to plan Resorts, Jellystone Rest and the in near our expand asset. Pennsylvania, with Northgate Harrisville, renovate acquired

XX%. is interest EPR's

investments out asset price Our our be the purchase around portion million. build was brings resort this X renovation is expansion RV our as of experiential and to we expected debt class. for million, and of lodging portion stable $X.X This to $XX.X the

Cap rates to long-term continued create in exceeded that range be for value. XXXX, which XXXX should compelling and in X%

in mentioned, spending entirely $XXX.X our XXXX experiential portfolio. was investment for I As million, total our

underwriting will breadth all hard quality XXXX. in unmatched achieved of of team, $XXX pleased was number our transactions the XXXX tenants with extremely the of by million. This of XXXX, our in and transactions XXXX We're and these leveraging A be of value so we and closed diversity partners. and our the total through was experiential funded over investments work driven network

added a and properties, with in market. villages, top Prussia, operator one-of-a-kind new ground in Bavarian a and Waterpark opened assets. developed Gravity in on King dominant Pennsylvania, populated golf broke well-located We densely including cutting-edge the with new House, We X relationship Ontario, Frankenmuth. Calypso We a the in a of and California Canada

in Chicago, to Alaska's Diego. strengthened We brand-new in our Season natural climbing Park Four hot premier location Springs a center of in and Springs market conference in investment and California, populated to Pagosa in Resort, both we We in Los movement in springs added and and invested acquisition San Angeles resort densely redevelopment a yoga acquired a resort. Resort Murrieta, Lincoln a proximate our fitness the into Alyeska

deployed for guidance of projects redevelopment in Through our to in experiential development spending range. in guidance included and committed million. be the XXXX, of for anticipate We $XXX million a midpoint years. investment X be of approximately over the to XXXX, issuing $XXX be funded end we and We're is yet not to have at the million range that of that deployed $XXX approximately the that million next $XXX will funds but $XXX are XXXX million closed amount deployed XXXX

In of expansion. both to almost and see and our all acquisition for build-to-suit experiential redevelopment high-quality opportunities continue categories, we

a with new pipeline concepts. customers have existing We and and robust

consciously credit near-term from primarily have revolving current cash with investment backdrop, those the investments reduce our ability spending borrowing from operations exercising and we and unsecured hand, and fund are cash to decided to facility. our on under discipline Given our

As opportunity. are by we recovery by of Greg cost of not the limited noted, capital, our

investments economic disciplined to and judicious until Capital We capital are approach levels. acquisitions with more future to our to our of Shepherd conditions cost returns improve with historical being

in investments redevelopment XXXX revenue investments and development on increased XXXX focus to Our come will these fully and lead as online. XXXX in

to I discussion now for of turn it over the Mark a financials.

sheet. quarter per versus and the on our AFFO our $X.XX the $X.XX year, share for compared for the Greg. to FFOs was quarter Thank you, strong the $X.XX balance provide I Today, adjusted was for year. financial $X.XX in an will and quarter prior in update prior performance discuss the

our into JVs Before additional to better customers; for deferral our percentage getting details, midpoint following: properties. rent Regal; second, results and due quarter at at deferral and additional collections guidance the high level, rent our the first, received; collections the managed performance third, a and significantly from non-Regal from the additional fourth, of exceeded

deferral collections portion and and variances quarter to the was revenue respect item. Now payments we in due million had for revenue abatements. or prior the payment. This deferral as continue all the as of tenants, certain to December recognized by a moving line on received previously versus in which be from a cash monthly primarily key through $XXX.X With September monthly Total million basis October increase rent Regal, rent the received well for to improved $XXX.X year. to was

Both the million deferral September the of the included payment of in amounts approximately received last these guidance of time not call. approximately $X.X payment prior midpoint we were by partial had yet the our million $X.X and December not of as

the the as property by the to the as offset rent over quarter effect of acquisitions was year past increase partially increase for Also developments with the prior scheduled contributing dispositions. and this of impact well year, versus increases completed

from fourth guidance deferral also did customers. these rent the deferred interest During not Recall December that payment quarter, midpoint our collected of customers. million include $X.X prior the due all the due approximately and non-Regal in representing from we we

as customers received. to the quarter, only for when we deferred on including owed continue to was cash total as recognized collected rent million revenue million had deferred us be approximately XX, basis books, of cash of rent $X.X which Regal, that not December from recognized In as At will the we received. $XXX

deferral the subject received X in also, Regal February full makes of to nonlegal well. and amounts is January and all this $XX mentioned, as those owed up payments for negotiation. million bankruptcy rent approximately Greg Regal balance Note as and and already have we collected have from deferral months

Finally, we at expect tenants our balance leaving a we of balance of deferred $X.X million accrual $X.X reduced $X.X XX from million that collect on to of receivables December on rent books basis in only this collected remaining approximately million, XXXX.

primarily insurance in $X.X quarter Moving recovery other million million income the on, a due prior on recognized million participation to by we of $X.X of versus higher the offset year, the had recognized $X.X income prior sales during gain in year.

received The was secured education La with sales of de participation paid in income included $X in million with connection of in and in loan, XXXX. early childhood a connection which property received in a sale business KinderCare the cash the million ski that in cash Creme's Creme to full sale $X.X mortgage

has adjusted income from FFO participation sale the that been Note and excluded AFFO.

KinderCare Additionally, income. the with properties X expect lease rental $X.X a million right during we in to education early termination second exercise of respect representing XXXX, quarter annual to

performance rent to anticipated anticipate a partially will have leases January on contractual We XX this that adjustment the offset effective adjustment terminations. related remaining The rent lease X, reduction is XXXX. based these on

assets. the into expect education X We these sell properties to redeploy early proceeds and experiential

Percentage million rents of exceeded $X.X the year. $X our which the our $X.X from of due or based for rent lease, types. restructured our The less tenant outperformance property in XXXX. million versus education totaled across to several percentage has to guidance prior in an midpoint Percentage million year rents quarter rents early higher primarily decrease related the base on by experiential prior

travel stock and as year, by an line $X.X with was expectations, grant versus an payroll fees. well G&A in costs, prior as expenses primarily amortization and increase professional to right including million increase in in increasing benefit expense

we've KinderCare period to the motion lease theater the the subject holding terminations the properties as Regal to subject the of reassessed During quarter, as properties of a X well reject leases. to X prior were that

properties. reassessment, a of $XX this on these As impairment a result recognized million we of charges total in

as FFO adjusted were charges AFFO. excluded impairment These from and

the from Lastly, have as million versus and to year year the million a to prior of prior loss the adjusted $X.X JVs by we decreased fact these versus seasonal joint $X.X FFO businesses. more of that ventures nature due

versus Despite better was the in of performance prior our the midpoint our in of the increase year, loss the anticipated prior guidance. JVs than

Shifting share $X.XX recovery share to year, per full year prior per COVID-XX being $X.XX pandemic. of the XX% adjusted in strong was compared about from up the was impact to and prior versus as the our the prior year FFO results. $X.XX in demonstrate AFFO the $X.XX measures Both year. versus

XXXX, collected year, customers interest receivables. $XX from In full basis million that $XX that we customers recorded was cash-basis and million in accrual from income and rent approximately as reduced approximately deferred

for operating dividends of excess in flow million. over total, $XXX cash In of we XXXX, generated

the credit next I'll company's the slide, ratios. to of Turning review some key

As at you coverage coverage coverage X.Xx, of can our service and continue Xx. debt strong to and with charge both interest fixed be is see, ratios ratio

Our our net was XX. book a XX% gross and basis Xx, December on was debt to adjusted to net assets at EBITDA debt

continues AFFO XX%. well Lastly, for an payout of dividend common with to fourth very ratio be quarter covered our the

Now let's of end, that or debt of approximately in rate all coupon been is At move sheet, blended is to swaps with fixed had X.X%. quarter which consolidated great a has debt through our fixed-rate shape. interest we $X.X debt of balance either which billion,

We average scheduled had debt years our is on billion drawn balance weighted no debt maturities maturity end X.X with and $XXX at quarter consolidated $X on nearly of cash our until Additionally, no revolver. million XXXX. hand

XXXX due to providing this to the We as Regal's guidance FFO call uncertainty are for related on not adjusted bankruptcy.

resolution to proceedings. these this guidance the will of provide We subsequent

near-term our unsecured from operations fund on previously capital current credit investments facility. spending and investment our we under borrowings cash have from our revolving environment, hand, inflationary in limit the to cost consciously primarily of discussed, we these decided cash current As have given and

$XXX anticipate $XXX additional to of million experiential to fund redevelopment guidance Accordingly, raise which to and $XXX need million investment projects, relates capital commitments to XXXX on closed we not spending our and approximately million, the development do amounts. these is

guidance rent found million is XXXX $XX to million details for XX percentage is Guidance our can $XX be our million, to on guidance and Our $X.X of supplemental. G&A $XX.X million. Page

over remarks. I'll his Greg that, turn closing it with for Now back to

associates and I themes moment in were investments And today. strong in Thank of key Outstanding growth you, resilience Mark. produce we of the forward pipeline and just consumer shareholders, that a few entire take to continuing of pride XXXX. driving our in call our thank take look for and our to FFO, team a wanted work continuing and results. our progress value hard so We acknowledge to these in

With why we open don't questions? that, up Chris, it for

[Operator from the Securities. comes BofA with Instructions] Dennerlein Our first of line question Joshua

guess not looking mentioned those. reject little I on motion Regal properties then leases press filed X was I decided for guess, you release, the Yes. to reject to X and more a proceed -- in a for for color I just bit -- initially, leases or with

Is provide there you any can And on color -- kind that? of additional

in Yes. very situation. that. Greg. much fluid it's Josh, very it's I a I wouldn't read into mean

the been If bankruptcy out at moved the way of motions. there's you and properties look in process,

like said, I I or it's know think positive I don't So that -- reading that is negative. that's into

It's on with go that of to just to more that? Greg, want But maybe lot you add tactics a that.

No.

it. summarizes that think I

get those were operating just your assets? Regal. do with different continue them, X it. of are how them on theaters the properties with you I And thinking I preference or guess, Got as Is about to kind then it assets you guess operator? would if what sell back, to a maybe more redevelop you

value. kind X opportunities, drives the specific. value, whatever best of there of it's property probably If are Again, very

Greg have optionality we've fact all about optionality we managed for talked we'll and his the team have to that want that of properties these created openly So that. us. if explore that We've that created

where is its uses, I'm sure, upon we alternative property would located depending the explore sale. and

variety but get But alternatives properties, So of of a until good not the we pursue. it's we how hard Greg? sense many really only would comment kind specific on to of

on And the theaters. sold strategies. We X mentioned, some out coming we as theaters. of think we pandemic, managed released theaters. Greg all I some then, executed X Josh, We

this as in have all case options available well. those we So

question comes Stevenson of from Scott. Rob Janney This Montgomery

whatever -- few smaller next the last over health their on problems Greg. on going gives going of legal theaters the operators? the of vast the are years Outside going the to else? and Are regional own a be to how over AMC Regal, follow-up or majority they to the a have do and of you have question, position characterize to of the be Just expansion be as retenant years? plans and whoever back in Or next would redeveloped the to these they're they something couple

But think the and nonpublic and government health into Greg of tenants generally program. helped in. let coming we I'll by of the Again, the out saw as were I jump assistance substantially

will or a of people said, a again, think, going I have So I operating as in opportunities very either be are we've find think and lack theaters good don't those always interested it's leasing have. for to who will home, we they that

what's a think going new for industry is see good think I to growth. you're I lot ground-up don't the of

looking really, for people will over production be into about what is be very can quickly But brought taken relative. So back Greg? that talking opportunities and we're

accurate. and regional I well. we number think And also say to our a do continue Yes, theater And that that is perform fine theaters I X.Xx. coverage within coverage of would have Rob, that's

And back has are -- a But about cap KinderCare, yet there? does X to that guys the you these? What what And reasonable education education if thinking reduced rates, not for know the better sell decently from side. the you you guys you education a while. hold to assets? for I that just Is is really that timeframe it's at been of there Okay. pricing pricing? and leased how portfolio that turning work? is Is that for that today there to available you're more these wanted then getting just to market days the the than

Yes.

think I'll Zimmerman Greg the it's And again, contact. approach. I let

This still is by buyer. one-off is the a market you're is the sought think after sell market still I good assets. XXXX rather if to that wanting

lot of interest there. lot a So there's

portfolios really debt. the of about to of the you it's availability I large think debt and start markets put as together, kind

at So of I net lot think point, of vastly therefore, kind lease the a kind and right from different not it of that finding just trades that opportunity. assets

I But good strong, there's still that for. evidenced the still, asset a it's resilient demand by performance, think as very class

pretty thing I used Rob, agree. And I it, the it would dental retail for that use call easily service office. are use, I'll other other, is say, buildings a these or medical be

So beyond there education. are opportunities other just

Okay. one cash your one then will where bankruptcy, know What guess basis go would as major for basis And it after then last is today? for Mark. assuming go best no AMC what exit accounting, off how would And to off be long issues them reasonable Regal accounting, going you to forward? given cash

office, want stabilization to box we of see and Really, the tenant of the continued credit. frankly, stabilization

So really conservative on put getting to paid what in that. a we to we'd to with going Frankly, recognizing respect We're don't revenue recognizing be similarly otherwise. timeframe that. we're be

basis when which straight-line And the the accrual. them put on put books, we're would from hurry of result cash not a be whole in lot to rent we to back a

and don't really performance continue a tenant we improvement have I So box make we to monitor, like to said, that before decision. office want timeframe, I certainly but

next This of comes Ki from Kim Truist. question Bin

coverage thinks drift box than sales because to? will XXXX level X.Xx more pay break the themselves, to where at office to can operators back a the pay the And that and what coverage of up be be that it healthy X.X? you with if obviously might is, think back. the bank industry What you coverage, these probably G&A, their from to theater have has perspective, what or Going pay business,

XX X.X the Ki theater in coverage think Again, years, range I point Bin, is, as a we metric. probably X.X operated a first to for of

has kind healthy. quite bracketing kind of to midpoint So be deemed X.X I that of think of around kind been

-- and think Greg I'll let comment on this. I

you're coming really XXXX I of the has is what number kind candidly, wide the drives think the over is of of number office because films. expectations kind and all together, film of seeing kind box release that board circulated everybody still slate the around on

we we're right -- feel of like I kind think going And think the that's in so I direction.

then kind the seeing what's XXXX headed kind think type to a -- production $X XXXX speak we're first of towards with number. of in number think and I of for to that I in I'll XXXX, real as return closer a billion that stabilization and -- Greg,

the a gets and of sit there still do this quarter where first right as year into lot that going that positive now trajectory based of where and 'XX 'XX, kind be about that last ends, so a What will as upon we are move studios the they is between or to a films it here year in of very cloudiness but into we're -- really there's stabilization. the saying what toward

But Now even at down. and business. still of But very environment a in Greg? we call we $X billion down, above, still, that's XX% it, that healthy have XX% think

major releases average million Ki to major Yes, critical have coming the other because smaller say of generally may would to number The releases is $XX but also that to films reach about Greg draw stopped of Bin, thing theater. I importance audiences we a traffic of is need sort title, is absolutely additional right. the

continuing. is production ramp-up The

change you decided Mike's last going for think to with stance example. Warner make greenlit Magic studios I understanding it theatrically I'll and million. leadership they've are theatrical. it's the Bros., Max in was money $XX HBO in give to made an that release they're nearly at

So where windows. streaming flexible in we theatrical getting studios XXXX into using kind and of were back bleeding with we're to

So as is the theatrical heal business. pointing we the in all that right direction

just other us trying pretty And your last are good within was the you I'm And that's just similar. competing when the it think case? like operators a just when you how to Regal we you downside, locations? versus Regal trying ratios take I'm radius look Can remind at lease? better the I reasonable Regal's time if the you even spoke, coverage to compare AMC, competitor out many bracket understand of rent locations, if

think not of earlier, market idea. again, again, disparity huge -- it's of kind as no far there the truly by as think, mean, there's talked great as kind market. Yes. about I I -- we is coverage And I

these of there's be think there We substantial of I will number assets. any demand doubt And -- a don't that. have for

it's -- it's a you Greg? of kind you when I be kind because can't brush. So market But XX by general going have to think of with assets, market again, paint

covers That Yes. Yes. it.

from comes question the R.J. of Milligan This James. line of Raymond

I the was you be ballpark any if when can concluded? Regal as with just curious to or negotiations us indication to expect give you

it. be into R.J. any insight that, great appreciate a if would we That had you And idea, would

As timeframe. overall -- this look not the end, to again, that's let's want just kind -- that we don't process at but it's of

said they they bankruptcy would out of they When February. in entered September, be end the at

going June. now their says they're out be latest think to plan I in

again, a into of lot there's just that go So dynamics it.

have you in think not filed with into they're what's convert lenders do equity. only to going worth they negotiating also billion where existing $X.X negotiating debt they billion about but they're to $X landlords about on that, of If plans

And parts through. so of are they that continuing lot to a moving there's work

that but that we've are there deal, a people we keep before think the may they I to negotiating of -- share may information want for I that if we that with -- other the confidential it say a landlords. are in what times bankruptcy transparency, and not to -- be negotiated negotiate haven't, we we can just end deal even of because the what announce relative until let's again, -- we want from just now, in month us and

to that dimensionalize at to R.J., us kind the appreciate it's very impact, desire frustration. of just of the hard timeframe and time. I So this the both do the appreciate kind I for to want

wait, payments. rent the getting deferral XXX% XXX% like while And we and while paid we're to we'd clear uncertainty,

but wait, we're resolve doing we're it. So as would fine like we we to

closing? why of that anything to childhood X about performance indication And second education Okay. the centers any the are then terms my That question closing, And in is those childhood the there as makes sense. they're overall is is for of that specific education portfolio?

elaborate But Greg some just let through combination. I'm I'll know And issues, anything there's I again, on that acquisition there's major went a don't sure this. -- but M&A performance you

there's -- think also things a I rationalization, go I'm into lot there's that there's -- of So mindset. performance, probably that there's

part of company X think kind to capital. portion having pleased and that free a be -- mentioned, when that We a to we're think we I substantial as that have X recover recycle Again, greater visibility also will did rent years very assets up this sell able public upgrade, reset as we us of of it as we credit a or that. gives a back ago, to Greg have with to so that KinderCare, we'll

the So we read-through because revenues any the of health had general attendance Greg don't think had on of up, as I kind there's spoke about, we early actually, up. ed

So in -- were performance strong had the these we portfolio. strong

NOI, $X which offset we have plus time by annual these will think decrease, time. add that, we redeploy were of get it in fact and reset, overall, we got terms you to plus come there. the in back, that time when will the better before in up the look properties Interestingly, you the although we than a rent it time step X By at probably million, sell the we will little take

This next question Aditi comes Markets. of Capital Balachandran RBC line of from the

quick X question Just from me.

rents KinderCare? Going in with KinderCare, any lease on with other are similar termination tenants there

mean, Adventure – this remember, is X, Learning you I moving – – – really. me Children’s did probably We KinderCare? this this the we helped X ago, don’t years operator we was Greg, into prior to when new negotiated the Not when

la Crème. de Crème

Crème not that termination de la something are Crème our But rights that. from portfolio. speed, broad we a to in have do

next line question John Massocca of Thalmann. of comes the Ladenburg This from

investment the experiential on Gravity of you structured, were those XQ the Turning think House, how mortgage what doing and the rough in -- you investments just investment just you're to kind in lodging the maybe space? what given as are about do the LTVs

but Greg, scenarios I low and speak these to and think relative Greg in XX%-XX%, closer can and they're lot of to this. let I'll a so LTVs Again, it's pretty

also in long-term these future, convert have to in thesis. we point time rights can the some at conversion We that

deployment to creating structure, So good but and income immediate term, impact. think the you is those gives of than control And the a if for then kind we optionality those notes. the convert us what visibility bit mortgage we are a better a and those income mortgage to preserve in right property from future, and lease in us development it long we different gain little

And helpful. going Regal. then Okay. to That's very back

handed amount ex about that be kind of by you one-for-one similar by a deferred reduced bankruptcy, of to if get should that's of percentage rejected, assets be expect rejected, that do percentage? roughly the are deferral reduced it the amount of $XX million If the to you leases a kind amount we of basis would i.e., back think on tenant, leases that be in get rent will owned

actually it's because No, driven leases. various the kind by rent what the is that on the of properties get

all of leases lease. associated by very would so they're it divided much income million the not and -- kind $XX to be And all by driven that specific so not are they're -- XX,

Okay.

to -- don't to be So either get assets the it's do going that bespoke very or

Yes. Yes.

That's line. it right. any congrats the the of me. And end on other all Okay. for

This comes Kim of Ki Truist. from the of Bin line

a Just quick one.

you XXXX? the for in the about excluding of the debt how thinking theater are portfolio tenancy, bad So remainder

in than We reserves XXXX, pretty put being Yes. we kind a bad it for X% general X.X, frankly, was always at in with good that but we reserve, higher the put coverage in feel some debt. of about

kind And that bad -- any kind noticeable within it of of concentrations more debt general is or

don't kind because, portfolio. of frankly, it's many non-theater at see general all reserve really Well, issues we our within a

So it's kind it's specific, general, of just Bin. Ki not a

then Great. current any that's X is aging all more noticeable? And it you on just loans question kind you Are make. of now, mortgage -- Okay. right that

None. No. current. All

this any for segment presentation. turn Q&A back for I'll our it Greg remarks. to concludes further over That Silvers

we us -- to so I Champion, to as that just today. that want thanks well. reminding And greatly John you we soon. thank look you talking We to for Super for everyone's the Bowl we participation forward of to appreciate home say are again,

thanks, everyone. great So a day. Have

Thanks.

And thanks, again. This program. conclude does the

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