EPR Raises 2026 Investment Outlook as Q3 Revenue Climbs 12%

EPR raised the lower end of its 2026 adjusted funds from operations guidance and increased its investment-spending outlook after third-quarter revenue rose 12% and adjusted FFO per share advanced 8.8%. The company also expanded into live-performance venues and added a fitness property as it continued to diversify its experiential portfolio away from theaters.

For 2026, EPR now expects adjusted FFO of $5.49 to $5.57 per share, compared with its previous range of $5.41 to $5.57. The midpoint represents an 8% increase from 2025. Investment spending is projected at $675 million to $725 million, up from the prior forecast of $600 million to $700 million.

Quarterly earnings and portfolio expansion

Revenue for the quarter ended Sept. 30 increased to $204.1 million from $182.3 million a year earlier. Net income attributable to common shareholders rose 55.5% to $94.1 million, or $1.22 per share, from $60.6 million, or $0.79 per share.

Adjusted FFO attributable to common shareholders increased 10.4% to $117.4 million, while adjusted FFO per share rose to $1.49 from $1.37. Adjusted funds available for distribution increased 11.4% to $121.1 million, or $1.54 per share.

For the first nine months of 2026, revenue grew 8.6% to $581.4 million. Adjusted FFO per share increased 9.2% to $4.16, while AFFO per share rose 9.8% to $4.26.

EPR invested $172.4 million during the third quarter at an average initial cash yield of approximately 8.3%, bringing year-to-date investment spending to $664.5 million. The activity included the company’s first live-performance venue investment, involving Live Nation in Portland, Oregon, and its first acquisition of a Life Time fitness center, located in Irvine, California.

The company also invested across fitness and wellness, eat-and-play properties and experiential lodging. It expects to spend about $21 million more during 2026 on existing experiential development and redevelopment projects.

EPR reported $7.6 billion of gross investments across 350 properties, with 99% of the portfolio leased or operated. Experiential assets represented 96% of annualized base rent, while education properties accounted for the remaining 4%. Portfolio coverage increased to 2.1 times.

Theaters remained roughly one-third of the portfolio, compared with the company’s goal of reducing that exposure to about 20%. EPR said attractions delivered strong third-quarter performance, fitness and wellness properties performed well with stabilizing trends, and education remained resilient despite industry-wide headwinds. Eat-and-play properties recorded solid performance despite moderation in the broader industry.

Capital and revised outlook

EPR sold the British School of Chicago at a capitalization rate in the low-7% range and now expects $86 million of disposition proceeds for 2026. Its previous guidance called for proceeds of $50 million to $100 million.

The company established a new $1.6 billion credit facility that extended the maturity of its $1 billion revolving facility to 2030, with two six-month extension options, and reduced the revolver’s interest rate by five basis points. The agreement also included a $600 million delayed-draw term loan due in 2032 and priced at SOFR plus 115 basis points. The term loan was fully drawn as of Sept. 30.

EPR had $3.3 billion of total debt at quarter-end, including $2.8 billion of fixed-rate borrowings with a weighted-average interest rate of 4.4%. It also repaid $179.6 million of Series B senior unsecured notes.

At Sept. 30, the company had $52.4 million of unrestricted cash, no balance outstanding on its $1 billion revolver and an estimated $134.6 million available from unsettled forward equity-sale agreements. Pro forma net debt to adjusted EBITDAre was 4.8 times, and the AFFO payout ratio was 60%.

EPR also increased its forecast for percentage rent and participating interest to between $21.5 million and $24.5 million, from $18.5 million to $22.5 million. It expects general and administrative expense of $57 million to $59 million, other income of $44 million to $50 million and other expense of $43 million to $49 million. The monthly dividend remains $0.31 per share, reflecting a 5.1% increase.

The results are preliminary and unaudited. EPR cautioned that its outlook depends on assumptions involving access to capital, transaction closings, investment timing, customer performance, cash collections and potential exits from certain joint ventures. The company also noted that forward-looking expectations are subject to factors outside its control and may differ from actual results.