EPR Properties Q3 2026 Earnings: Revenue Rises 12% as FFOAA per Share Grows 8.8%

EPR Properties (NYSE: EPR) reported Q3 2026 revenue of $204.1 million, up 12.0% year over year, while GAAP diluted EPS rose to $1.22 from $0.79. FFOAA per diluted share increased 8.8% to $1.49 as quarterly investment spending reached $172.4 million, although a $30.5 million property-sale gain amplified the increase in GAAP profit.

Core Earnings Data

Rental revenue increased to $175.3 million from $154.8 million and accounted for most of the $21.8 million increase in total revenue. Other income rose to $14.2 million from $12.1 million, while mortgage and other financing income declined to $14.6 million from $15.3 million.

Net income available to common shareholders grew substantially faster than the company’s adjusted REIT earnings measures. FFOAA and AFFO still increased at double-digit rates in aggregate, indicating that the quarter’s improvement was not solely due to property-sale gains.

FFOAA and AFFO are non-GAAP measures. EPR revised its AFFO definition during the quarter to stop deducting maintenance capital expenditures and recast all presented periods on the new basis. Under the previous definition, Q3 2026 AFFO would have been $120.1 million, or $1.53 per diluted share, compared with the reported $121.1 million and $1.54.

Portfolio Investment and Operations

EPR invested $172.4 million during the quarter, bringing investment spending for the first nine months of 2026 to $664.5 million. Of the quarterly total, $102.1 million funded the acquisition of two eat-and-play properties and two fitness and wellness properties, including an existing Life Time location in Irvine, California.

Another $27.2 million went to mortgage financing secured by experiential lodging and fitness and wellness properties. EPR also began funding a build-to-suit live performance venue in Portland operated by Live Nation, with the remaining spending directed to other experiential development and redevelopment projects.

The company expects to spend another $183.2 million on existing experiential development and redevelopment commitments, including approximately $21.0 million during the remainder of 2026.

At quarter-end, EPR had $7.6 billion of total investments. Experiential properties represented $7.2 billion, or 95%, while education investments accounted for the remaining 5%. The combined wholly owned portfolio covered 20.7 million square feet and was 99% leased or operated; wholly owned education properties were 100% leased.

EPR also generated $74.0 million of disposition proceeds during the quarter. This included $68.2 million of net proceeds from selling a private school property and the associated $30.5 million gain.

Property Sale Gain Amplified GAAP Growth Beyond FFOAA

GAAP net income available to common shareholders increased 55.5%, compared with 10.4% growth in FFOAA. A major reason for the difference was the $30.5 million gain on real estate transactions, up from $8.1 million in the prior-year quarter. FFO-based measures exclude real estate transaction gains and add back real estate-related depreciation and amortization.

The provision for credit losses also declined to $0.8 million from $9.1 million, supporting reported operating income. These benefits were partly offset by depreciation and amortization rising to $51.1 million from $42.4 million and net interest expense increasing to $40.3 million from $33.2 million. The result was positive underlying FFOAA growth, but at a more moderate rate than the headline increase in GAAP EPS.

Profitability, Liquidity, and the Balance Sheet

Debt stood at $3.35 billion on September 30, 2026, up from $2.93 billion at the end of 2025 during a period of elevated investment spending. Cash and cash equivalents declined to $52.4 million from $90.6 million over the same period.

EPR entered into a new $1.6 billion credit agreement consisting of a $1.0 billion unsecured revolving facility and a $600.0 million delayed-draw term loan. The term loan was fully drawn at quarter-end, while the revolver had no outstanding borrowings and remained fully available. The agreement extended the revolver’s maturity and generally reduced its borrowing rate by five basis points. EPR also repaid $179.6 million of senior unsecured notes at maturity.

Unsettled forward equity agreements represented an estimated $134.6 million of net proceeds and 2,285,835 common shares at quarter-end. These agreements add funding capacity but would increase the share count when settled.

The release did not provide quarterly operating cash flow or free cash flow, so cash-based dividend coverage cannot be assessed from the disclosed results. EPR maintained a monthly common dividend of $0.31 per share, equivalent to $3.72 annually and 5.1% above the annualized dividend at the end of the prior year.

2026 Guidance

EPR raised the lower end of its FFOAA per-share range while leaving the upper end unchanged, increasing the midpoint and narrowing the range. It also lifted both its investment-spending guidance range and GAAP net income per-share outlook.

The $5.53 midpoint of the latest FFOAA range represents an 8.0% increase over 2025, according to the company. The investment-spending midpoint increased to $700 million from $650 million, consistent with the $664.5 million already deployed through the first nine months. The updated $86 million disposition estimate is also close to the $85.4 million generated through September.

Management View

Chairman and CEO Greg Silvers attributed the quarter’s momentum to earnings growth and an active investment pipeline. Management highlighted the expansion of EPR’s experiential portfolio through its first live venue relationship with Live Nation and the addition of a Life Time fitness and wellness property. It also pointed to the new credit facilities and forward equity agreements as sources of capacity for further investments.

Risks Investors Need to Watch

• GAAP earnings benefited from asset sales: The $30.5 million property-sale gain caused GAAP EPS to grow much faster than FFOAA, making the adjusted measure more representative of recurring performance for the quarter.
• Financing costs are rising: Quarterly net interest expense increased to $40.3 million, while debt rose from the end of 2025 as the company accelerated investment activity.
• The larger investment program requires execution: EPR has $183.2 million of additional commitments for existing projects, and future returns will depend on successful development, leasing, and tenant performance.
• Forward equity creates potential dilution: Settlement of the outstanding forward agreements would provide capital but add approximately 2.3 million common shares.
• Portfolio concentration remains high: Experiential assets account for 95% of total investments, limiting diversification across broader real estate categories.
• AFFO comparisons require care: EPR’s revised AFFO definition no longer deducts maintenance capital expenditures. Prior periods were recast, but comparisons with REITs using different definitions may still be less meaningful.

Summary

EPR’s Q3 2026 results combined higher rental revenue and adjusted funds from operations with a faster pace of experiential investment. A property-sale gain made GAAP profit growth notably stronger than recurring FFOAA growth, while increased debt and interest expense reflected the funding demands of the investment program. The raised guidance points to continued deployment and earnings growth, with financing costs, project execution, and potential equity dilution remaining the main items to monitor.