EPR Properties

Hello, and welcome to the EPR Properties Q4 and year-end 2025 earnings call. We ask that you please hold all questions until the completion of the formal remarks, at which time you will be given instructions for the question and answer session. Also, as a reminder, this conference is being recorded today. If you have any objections, please disconnect at this time. I will now hand the call over to Brian Moriarty, Senior Vice President of Corporate Communications.

Okay, thank you, Jenny. Thanks for joining us today. for our fourth quarter and year-end 2025 earnings call and webcast. Participants on today's call are Greg Silvers, Chairman and CEO, Greg Zimmerman, Executive Vice President and CIO, Mark Peterson, Executive Vice President and CFO, and Ben Fox, the Executive Vice President. I'll start the call by informing you that this call may include four looking statements as defined in the Private Securities Litigation Act of 1995, identified by such words as will be intended to continue to believe, may expect, hope, anticipate, or other comparable terms. The company's actual financial condition and the results of operations may vary materially from those contemplated by such forces and statements. Discussion of those factors that could cause results to differ materially from these four looking statements are contained in the company's SEC filings, including the company's reports on Form 10-K and 10-Q. Additionally, this call contains references to certain non-GAAP measures, which we believe are useful in evaluating the company's performance. A reconciliation of these measures to the most directly applicable GAAP measures are included in today's earnings release and supplemental information furnished to the SEC under Form 8K. If you wish to follow along, today's earnings release supplemental information and earnings call presentation are all available on the Investor Center page of the company's website, www.eprcc.com. Now I'll turn the call over to Greg Silvers.

Thank you, Brian. Good morning, everyone, and welcome to our fourth quarter and year-end 2025 earnings call and webcast. The fourth quarter kept a year of solid execution and clear progress toward accelerated growth. Our resilient portfolio benefited from growth an AFFO per share increase of 6.2%. During the fourth quarter, we announced transactions which significantly expanded our portfolio of championship golf courses, along with premier regional water park acquisition, further diversifying our attraction sector. As we move into 2026, we we are actively pursuing opportunities across multiple target property types with a flexible approach that encompasses both potential portfolio-scale acquisitions and smaller strategic transactions, positioning us to capitalize on attractive opportunities as they arise. Turning to industry and tenant performance, our portfolio released titles. Performance across our other property sectors remains steady, demonstrating the strength and resilience of our diversified portfolio. As we expand the diversity of our experiential portfolio, we're seeing a balancing effect, strength in certain sectors helping to offset periodic softness in others, reinforcing overall portfolio resilience. Our strategic capital recycling program continues We will continue to use disciplined opportunistic recycling as a proven lever for driving value creation. Our balance sheet remains one of our most important competitive strengths. During the fourth quarter, we successfully closed a $550 million public debt offering and established a $400 million aftermarket equity program, two significant capital market initiatives that bolster our financial flexibility and fund our growing investment pipelines. Reflecting the confidence we have in our earnings trajectory and conservative payout ratio, we are also pleased to announce a 5.1% increase for our monthly dividend to common shareholders. In summary, we've built a robust pipeline of high-quality experiential investments. Our strong balance sheet and expanded operator relationships now give us access to larger opportunities, and our disciplined approach to capital allocation positions greater details. Thanks, Greg. At the end of the quarter, our total investments were approximately $7 billion with 333 properties that are 99% leased or operated. During the quarter, our investment spending Our experiential portfolio comprises 278 properties with 54 operators and accounts for 94% of our total investments, or approximately $6.6 billion, and at the end of the quarter was 99% leased or operated. Our education portfolio comprises 55 properties with 5 operators, and at the end of the quarter was 100% leased. December trailing 12-month period, overall portfolio coverage remained strong at two times. Turning to the operating status of our tenants. 2025 box office was $8.7 billion, a 1% increase over 2024. Q4 box office was $2.2 billion compared to $2.4 billion in Q4 2024. Q4 performance was led by strong results from Zootopia 2, which rose $337 million in Q4 and has exceeded $420 million to date. Wicked for Good rose $335 million. Avatar Fire and Ash rose $250 million in Q4 and picked up an additional $147 million after the first of the year. Five Nights at Freddy's 2 also outperformed. The slate for 2026 looks solid, with the Super Mario Galaxy movie, The Mandalorian and Grogu, Toy Story 5, Minions 3, Moana, The Odyssey, Spider-Man, Brand New Day, Avengers, Doomsday, and Doom Messiah. Analysts expect box office to increase in 2026. Going forward, we will be moving away from providing annual estimates for box office performance. As theaters were reopening, box office was recovering, and we were navigating the writer's and actor's strengths. With all the dislocation, we thought it was helpful to share our perspective. The business is stabilizing, so this is no longer necessary. Additionally, it's important to highlight that the bulk of our theater rent is not tied to fluctuations in box office. The only significant percentage rent component of our theater rent comes from Regal, which is based on a lease year rather than a calendar year, and our estimate of Regal percentage rent is embedded in our percentage rent guidance. A couple of points related to box office. First, higher margin F&B spending increasingly constitutes a higher percentage of exhibitors' overall revenue. As such, it is not necessary to reach 2019 box office levels for us to have comparable coverage. Second, as we have consistently noted, the number of major releases directly correlates to box office. An increased number of major releases typically drives increased box office growths. Over time, major releases tend to generate an average performance in the range of 70 million. Turning now to an update on our other major customer groups. Our East Coast ski and Midwest ski operators got off to a great start with above-average Our Northern California asset opened late because of lack of snow, but conditions have improved significantly with recent snowfall. We will see if snowfall continues to hold throughout the season. Alyeska has had strong demand throughout the season, augmented by its membership program and inclusion in the ICON network. Our Eat and Play coverage remains strong, even with some continuing macro pressures on consumers and expense increases. Andretti Carding's Kansas City location opened well in mid-November. Schaumburg, Illinois is expected to open the second quarter of 2026. Our second pen stack, located in Northern Virginia, is also expected to open in Q2. Of note, in early January, Topgolf Callaway announced the completion of its sale of a 60% interest in Topgolf to Leonard Green Partners, the transaction valuing Topgolf at around $1.1 billion. We view this positively because Hopgolf now has a focused private equity majority owner. Many of our attractions are closed for the season. The Car Chase Outdoor Winter Park and Hotel de Glace opened in December and are benefiting from sustained domestic travel within Canada. We are quite pleased with the performance metrics at Enchanted Forest Water Safari in our operator's first and Family Entertainment Center fully open at Bavarian Inn, we saw significant year-over-year increases in revenue and EBITDA. We are bullish on the fitness and wellness space. Since 2024, we have invested approximately $150 million in this vertical, including golf, fitness, and hot springs. All three of our hot springs assets delivered strong year-over-year performance. Our education portfolio continues to perform well. Our customers' trailing 12-month revenue for Q3 was essentially flat, with EBITDA down due to expense increases. Coverage remains strong. Our investment spending continues to be entirely within our broadening range of experiential asset types. In Q4, we invested $147.7 million, bringing our total for 2021 This includes funding for projects that we have closed on but are not yet open. In addition, we have committed approximately $85 million to experiential development and redevelopment projects, which we expect to fund in 2026. Q4 investment spending was anchored by our acquisition of a five-property portfolio of championship golf courses in the Dallas Metroplex for approximately $90.7 million. The properties will be leased and operated by Advanced Golf Partners, a leading golf course operator. This investment follows our extensive research into the golf space and adds to the additional golf investment we made earlier in 2025. Given our deep relationships, the increased focus on fitness and wellness among multiple generations and demographics, and the wide range of investment opportunities, including golf, climbing gyms, traditional gyms, hot springs, and spas, We are excited about the potential for continued growth in this space. We also acquired the Ocean Breeze Water Park in Virginia Beach, Virginia, in a sale-leaseback transaction for approximately $23.2 million. Ocean Breeze will be leased and operated by an affiliate of Premier Parks, a longtime strategic partner. We kicked off investment spending for 2026 with the first quarter acquisition of the Vital Climbing Lower East Side in Essex Crossing for approximately $34 million. As I noted before, we are particularly bullish on the fitness and wellness space and excited to grow our relationship with this outstanding operator by adding a high-quality Manhattan location along with our existing Vital Climbing location in Williamsburg, Brooklyn. As demonstrated by our investments in Q4 and already in Q1, we are increasing our investment spending cadence. We are seeing high quality opportunities for both acquisition and build-to-suit development in our targeted experiential categories. Our disciplined deployment strategy has enabled us to expand the depth and breadth of our portfolio of experiential properties over the past several years. Our investment spending throughout 2025 and heading into 2026 reflects our deep relationships and high-quality opportunities. We are announcing investment spending guidance for funds to be deployed in 2026 in the range of $400 million to $500 million. During the quarter, we sold two leased theater properties for alternative uses and two land parcels for net proceeds of $16.1 million. and recognized a gain of $5.3 million. Additionally, as announced on our Q3 call, we received $18.4 million in proceeds from a partial pay down on a mortgage note relating to the Gravity House in Steamboat Springs. In the past five years, we have sold We are announcing 2025-2026 disposition guidance in the range of $25 million to $75 million. I now hand over to Mark for a discussion of the financials. Thank you, Greg. Today I'll discuss our financial performance for the fourth quarter and the year, provide an update on our balance sheet, and close with introducing 2026 guidance. FFOs adjusted for the quarter was $1.30 per share versus $1.23 in the prior year, an increase of 5.7%. And AFFO for the quarter was also $1.30 per share compared to $1.22 in the prior year, an increase of 6.6%. Before I walk through the key variances, I want to point out that we had disposition proceeds totaling $34.5 million for the quarter and recognized a gain on sale of $5.3 million. For the year, we had disposition proceeds totaling $168.3 million. I recognize the gain on sale of $39.5 million. As we continue to make progress reducing our investments in theater and education properties and recycling those proceeds into other experiential assets. Note that these gains are excluded from Epiphos Adjusted and AFFO. Now moving to the key variances. Total revenue for the quarter was $183 million. Within total revenue, rental revenue increased $7.9 million versus the prior year, mostly due to the impact of investment spending, rent and interest bumps, and higher percentage rents and participating interest. Percentage rents and participating interest for the quarter were $7.8 million versus $4.9 million in the prior year, and the increase was due primarily to higher percentage rent recognized from our attraction and cultural properties, as well as from one of our early childhood education tenants. We also had higher participating interest related to our northeast ski property. Both other income and other expense relate primarily to our consolidated operating properties, including the Cartwright Hotel and Indoor Water Park and our four operating theaters. The decrease in other income and other expense versus prior years due primarily to the sale of three operating theater properties in the first half of 2025. On the expense side, G&A expense for the quarter increased to $14.6 million versus $12.2 million in the prior year, due primarily to higher payroll and benefit expense, particularly incentive compensation. Equity and loss from joint ventures for the quarter was $2.4 million compared to $3.4 million in the prior year. This better performance is due to our decision to exit our joint venture in as well as improved results for our two remaining RV park joint ventures. Shifting to full-year results, FFOs adjusted was $512 per share at the high end of guidance, versus $487 in the prior year, an increase of 5.1%, and AFFO was $514 per share compared to $484 in the prior year, an increase of 6.2%. Turning to the next slide, I'll review some of the company's key credit ratios. As you can see, our coverage ratios continue to be very strong, with fixed charge coverage at 3.4 times and both interest and debt service coverage ratios at 4 times. Our net debt to annualized adjusted EBITDA RE was 4.9 times at year end, which is below the lower end of our targeted range. Additionally, our net debt to gross assets was 39% on a booked basis at year end, And our common dividend continues to be very well covered with an ethical payout ratio of 68% for the fourth quarter and the full year. Now let's move on to our capital market activities and balance sheet, which is in great shape to support our expected growth. At year end, we had consolidated debt of $2.9 billion, of which all is either fixed rate debt or debt that has been fixed through interest rate swaps with an overall blended coupon of approximately 4.4%. In November, we closed on $550 million of new five-year senior unsecured notes at a coupon of 4.75%. And at year-end, we had $90.6 million of cash on hand and no balance drawn on our $1 million revolver. Additionally, in December, we finalized our new ATM program. While no equity issuance is required to fund our plan for 2026, given that we project to be below the midpoint of our targeted leverage range at year-end without any such issuance, equity opportunistically, including forward sales. We are introducing our 2026 FFOs adjusted per share guidance of 528 to 548, representing an increase versus the prior year of 5.1% at the midpoint. We expect a similar percentage increase in FFO per share. Note that due primarily to the timing of the expected percentage rents, which are heavily weighted the last three quarters of the year, as well as the fact that the first quarter is off-season for our operating properties, we expect results for the first quarter of 26 to be lower than the full year divided by four by about 11 cents per share. We are also providing our 2026 guidance for investment spending of $400 million to $500 million and disposition proceeds of $25 million to $75 million. We expect a percentage rent and participating interest of $18.5 million to $22.5 million. As you can see on the slide, I have provided a reconciliation of the prior year amount to the midpoint of this guidance. The changes include out-of-period percentage rents and participating interest of $3.5 million recognized in 2025 that does not repeat, lower projected percentage rents in 2026 of $1.1 million related to our Northern California speed property due to delayed snowfall for the season, And lower projected percentage rents of $0.4 million related to certain properties having base rent increases in 26, causing the breakpoint for percentage rents to increase. These decreases were offset by a projected net increase of $1 million in percentage rent for other tenants, including Regal. We expect G&A expense of $56 million to $59 million. In addition, guidance for our consolidated operating properties is provided by giving a range for other income and other expense. Guidance details can be found on page 23 of our supplemental. Finally, based on our expected 2026 performance, we are pleased to announce a 5.1% increase in our monthly dividend, beginning with the dividend payable April 15th to shareholders of record as of March 31st. We expect our 2026 dividend to be well covered with an FFO per share payout continuing to be about 70% based on the midpoint of guidance. Now with that, I'll turn it back over to Greg for his closing remarks. Thank you, Mark. 2025 was a very solid year as we delivered strong per share earnings and our portfolio delivered the resilience that we anticipated. In 2026, we expect to increase our which should result in another year of strong per share earnings growth. As we begin the year, we are excited about our investment pipeline, our balance sheet, and the team to create value out of this combination. I would also like to take a minute to express my sincere appreciation to Greg Zimmerman, who has participated in his last earnings call as he is retiring from UPR. Greg provided leadership and established side. He is my business partner, colleague, and friend, and he will be missed. Ben Fox will now officially take over the role of Chief Investment Officer, and we are excited about his leadership and vision for our future. With that, why don't I open it up for questions. Jenny?

Thank you. At this time, if you would like to ask a question, please click on the raise hand button which can be found on the black bar at the bottom of your screen. When it is your turn, you will receive a message on your screen from the host allowing you to talk and then you will hear your name called. Please accept, unmute your audio and ask your question. If you are on a mobile device using the app, simply tap into the three dots or more button to find the raise hand feature. And lastly, if you are calling in today, star nine will activate the raise hand and use star six to mute and unmute. We will wait one moment to allow the queue to form. Our first question will come from Michael Goldsmith with UBS. You'll receive a message on your screen allowing you to talk. Please accept, unmute your audio and ask your question. Michael Goldsmith with UBS. You may ask your question.

Good morning. Thanks a lot for taking my question. Consistent with last quarter, where you pointed to $400 to $500 million in acquisitions, you put this out formally with your guidance. Can you just talk a little bit about what you're targeting, what you have line of sight in, because it represents an acceleration, so just trying to get a sense of what you're looking at, what you have line of sight in, and just your confidence level of hitting that $400 to $500 million and acquisitions. Thanks.

Mike, thank you. Clearly, I think, you know, line of sight or anything, what we don't want to comment on specific, we wouldn't put it out there if we didn't have great confidence in it. Again, if you look historically, we've been successful in, A, not only hitting our numbers but, you know, raising those throughout the year. So I think, and I'll let Greg comment, that we feel really good about where we're positioning for the beginning of the year. I think we're looking at opportunities across most, if not all, of our sectors. I think, again, we feel like we have particular unique access to the areas that we invest in. But let me let Greg. No, I agree, Greg. And I would also say that, you know, developing a pipeline is usually a multi-year process. So we've been building up to this. with the line of sight to the fact that we turn on investment spending this year. So, again, as Greg mentioned, we're very confident about it, and that's why we're achieving the guidance.

Got it. Thank you very much for that. And then second question, just, you know, Topgolf is one of your top tenants and they've been taken private by private equity. You know, have you had conversations with Leonard Green and just try to get an understanding of, you know, what they're going to do with the company now that they have their hands on it and just, you know, the path and your comfort level with your specific locations that you own?

Yeah, and we've had multiple conversations with them. So, as you can imagine, both as they were evaluating it as an opportunity and now subsequently, I think the thing that we're encouraged is, in fact, what they've told us is they're very much aligned with what we have said, that the growth pattern needs to slow down to, you know, three to five units a year where they can hit kind of the demographic and location requirements that we kind of agree with them. As we said all along, our units continue to demonstrate very, very strong coverage. I think it's an integral part of the value equation that they saw. I think there are opportunities that they're going to very much look at. They have a long history of multi-unit retail and even in the fitness and wellness space. So I think they're very, very focused on kind of the food and beverage and promotional opportunity sets. And you've seen those early impacts of the second half of last year We were talking about was already addressing some of those and saw some very, very positive numbers going into the second half of the year in the fourth quarter. And then I would also add, Michael, we're very pleased. They're going to continue their refresh program, which benefits us greatly. They do a handful of our units every year with a nice refresh to keep them up. Thank you very much. Thanks.

Our next question will come from John Kilichowski with Wells Fargo. You will receive a message on your screen allowing you to talk. Please accept a mutual audio and ask your question. John Kilichowski with Wells Fargo. You may ask your question.

Hi, good morning out there. My first question is on where you see your cost of capital today. You know, you're trading back close to a range where we were, you know, end of the third quarter. You know, when does it start making sense to tap an ATM?

Sure, John. Great question, and I'll join in and ask more. I think, you know, we probably see it now in the kind of upper 50s or early low 60s at kind of low 7s, low mid 7s. I think that works. We can make that work. You know, we're doing things in the low to mid 8s, so there's people know that we can execute that way and get back on that flywheel of issuing equity. As Mark talked about in his comments, we don't need to. In fact, we'll still be not even near the midpoint of our leverage range doing the plan that we have executed. But what it does mean is maybe we can do more, maybe we can even further delever. I think it gives us a lot of options and we kind of opportunistic about it, particularly if we're headed to the higher end of spending, investment spending. As Greg said, I think, you know, as you get to the high 50s, low 60s, or low to mid-7s type of cost of capital, and as Greg said, you get nearly 100 basis points out of the gate, and then, of course, on an IRR basis, it's quite a bit higher than that when you factor in our rent bumps. So I feel good about that and the opportunity that lies ahead.

That was very helpful. Thank you. Maybe, you know, just along those same lines, if we could do sort of a sensitivity analysis, let's say if your cost of capital got 50 bps better from here on a blended basis, you know, where does that take, you know, maybe the high end of your investment guide? If this is a better buying opportunity here, I'm just curious how much more you think you can do if you just had a little bit of improvement on that cost of capital.

Yeah, exactly. opportunity out there. And, John, I think, again, it's probably not as linear as we're laying it out that it's, you know, 50 basis points. It's really about are the right opportunities and the risk and reward. I think, overall, you're hearing our excitement about the opportunity set out there. There continues to be good opportunities. I think we're excited about those. We're excited about where our cost of equity seems to be trending. And so hopefully that combination will allow us to continue to grow and grow that base. But to speculate on a kind of a sensitivity table would probably be not productive for us right now.

Got it. Thank you.

Thank you, John.

Our next question will come from Smead Rose with City Global Markets. You'll receive a message on your screen allowing you to talk. Please accept a mutual audio and ask your question. Smead Rose from City Global Markets. You may ask your question.

Hi, thanks. I was just wondering if you had any updates on what's going on in Sullivan County in terms of the ability to sell the ground lease that kind of came up a while ago. That'd be my first question.

Thanks, Smead. I would say we've not had really any meaningful conversations with them. I mean, again, when I say that, meaning our operator, you know, it's their call on how they want to proceed. It's not built into our plan. You know, our plan is utilizing our existing kind of cash flow dispositions, things that we've done. But the easiest thing to say, Smead, is no, we've not had any meaningful conversations with the operator.

Okay, thanks. And then I was just wondering, you know, when we look in a sort of theme park world, you know, there seems to be, you know, I guess a certain amount of disruption going on and some new management changes. I'm just wondering, are they kind of showing up on your radar screen as a possible solution to some of the issues they might be facing?

I think it's a very reasonable approach. I mean, if you think about the names that are being dropped around, you know, we partner with many if not all of those names that are being dropped around. So I think it's something we think that business is actually very, very, if you look over time, very stable cash cow kind of business. It needs to be a smart, thoughtful, well-covered kind of thoughtful business. But, again, we play in that field. I don't know, Greg, if you want to. Well, I agree. And as we announced, we've acquired something in the fourth quarter. So, yes, we're. enthusiastic about the attraction space.

All right, thank you. And best wishes to you, Greg, going forward. Oh, thanks.

Our next question comes from Anthony Pallone with JP Morgan. You will receive a message on your screen allowing you to talk. Please accept a mutual audio and ask your question. Anthony Pallone with JP Morgan, you may ask your question.

Great. Thanks. Just, Greg, going back to the opportunity set that you talked about, can you be a little bit more specific in maybe how much of it is development, redevelopment versus buying existing assets and maybe kind of the range of cap rates and what would take you into the eights versus where you'd probably be maybe in the sevens if something is perhaps a bit higher quality or different?

Sure. And I think it's going to gear, at least early part of this year, going to be more on the acquisition side. So I would say, you know, and I'm looking at Greg and Ben, probably 70-30 acquisitions right now. I think, again, where you would look at You know, most of our stuff has been in the eights where you would look at something below that potentially would be a much lower advance rate. It's really going to be risk return or if you had a credit, you know, you had a much, much higher credit scenario to where you would think lower sevens but a better growth profile. But I would say most of our stuff are right now that we're looking at has at least an initial eight handle on it. And, Tony, obviously, development deals are going to carry a higher cap rate because there's more risk adjusted, there's more risk.

So that's kind of the way we look at it. Okay. Got it. And then my only other question maybe for Mark and just on the spending here, if I look at page 19 of the supplemental, There's about $63 million of spending outlined there. Is that different than the $85 million that you guys talked about in the presentation or you put those together?

Yeah, no, that's a good question. The $63 million is only related to those projects that have been started at the end of the year. And then the difference between that and the $85 million is projects that haven't been started but that we have commitments and line of sight to. at the end of the year, 85 million is the number to use. And then if you add, you know, for example, the vital climate gym that we did, we're sort of sitting at around 119 million right now and sort of spoken for spending. And as Greg said, I think, you know, the amounts that we'll add to get to the midpoint of guidance are 450 will be mostly acquisition oriented.

Okay. Got it. Thank you. Thank you.

Our next question comes from Michael Carroll with RBC Capital Markets. You'll receive a message on your screen allowing you to talk. Please accept a mutual audio and ask your question. Michael Carroll with RBC Capital Markets. You may ask your question.

Yeah, thanks. I guess, Mark, just sticking with the guidance ranges that you provided in the investment, with that remaining investments to get back up to that $450 million, with guidance, when do you assume that gets completed? Is it just kind of randomly throughout the year, or do you kind of have a back-end weighted? What's kind of implied in that guidance range?

Yeah, it's actually, frankly, weighted more towards the first half of the year, the way we see things kind of laying out.

Okay. And then on the Regal percentage rents, what you put in guidance, what did you assume would be the box office, at least for the Regal lease year ended July 2026 versus the prior year? Is it kind of a similar box office that we're expecting percentage rents for Regal to be kind of in line with what it was last year?

Yeah, I think it's slightly up, consistent with kind of analysts. But as you can see, it's probably kind of up kind of 2% over where they were last year, as our number is up slightly over there. Yeah, when we lay out that percentage rent slide, you can see once you cut through the prior period and so forth, you get to about a million of net growth. And a good chunk of that is real because we do expect box office to be higher next year. And, again, Mike, the regal lease year ends in July, so you're not going to have the advantage of the fall season.

Yeah, got that. And then just last one for me, I know, Greg, you mentioned and talked a little bit about the investment opportunities you have across all your property types. I mean, are there any specific property types where you're seeing bigger opportunities or other types of activity that you could pursue? Sure.

We've hit several things. I would say the top three continue to be fitness and wellness, attractions, and eat and play. Again, when you look at those, we're still seeing an occasional opportunity in gaming, but not as much. Ski is more opportunistic. So those other three, I think, are going to be the anchor part of what our investment is going to come from. And, Mike, again, I would, you know, when we say fitness and wellness, that's a very broad category for us. Obviously, we've done a couple of golf deals now. We did a climbing gym deal this quarter. We did a regular fitness deal last quarter, and we have done a hot springs deal. So we see a lot of opportunity to expand the aperture in that space.

Great. I appreciate it. Thanks.

Our next question comes from Upal Rana with KeyBank Capital Markets. You will receive a message on your screen allowing you to talk. Please accept a mutual audio and ask your question. Upal Rana with KeyBank Capital Markets. You may ask your question.

Okay. Thanks for taking my question. I'm just curious on how the transaction market looks like in terms of larger deals. You know, are you seeing more or less out there?

Again, I think we're starting to see, as we said, I don't know if we're seeing more. We're seeing our ability to participate. your deals more and I think so that's beneficial to us but I think it feeds into what you know when you look at what we've done we're talking about two years in a row of delivering five percent plus kind of earnings growth it's getting back into what is our kind of normal trajectory of delivering outsized value for our shareholders and now we're going to be able as we A, one, generated a lot of proceeds from dispositions, or two, getting close to our ability to issue equity through our AGM program, it's going to allow us to participate in some of these deals, which will further that growth so that the idea that we've been done it, we did 5% last year, we're doing 5% this year, let's get on that track of what we delivered 20 years before COVID.

It looks like negotiations are beginning to start up again on SAG-AFTRA with the contracts that were negotiated in 2023 expiring in May for writers and in June for the actors. The environment is certainly much different today than it was three years ago. We wanted to get your take on those negotiations and how that could play out.

Again, I think we think it's still really early, but I think you're correct. I think it's really early. I think it's going to to deal with that. And everybody, I think, at this point saw how negatively the market was impacted by a strike. And much like what we've seen in some other areas like baseball, people have tried to avoid strikes because they have long-lasting effects. And everybody's saying the right thing about wanting to avoid that.

Great. Thank you. Good luck this year.

Our last question comes from Upal Rana. Apologies, that is Jana Garland with Bank of America Merrill Lynch. You'll receive a message on your screen allowing you to talk. Please accept a mutual audio and ask your question. Jana Garland with Bank of America Merrill Lynch. You may ask your question.

Thank you. Good morning. I know this is a much smaller part of your portfolio, but curious if you could just provide an update on the education portfolio and kind of any changing trends there between early childhood and the private school.

Again, I think, if anything, the strength of that portfolio has continued to be demonstrated over the last several years. I think one area that, you know, as we think about dispositions this year, maybe an area that we start to think about, I mean, last year was allow us to capture good value if we want to do that and could be another lever that we pull to accelerate growth great thank you and also wanted to congratulate greg oh thank you there are no more questions so i will now turn the call back over to greg silvers chairman and ceo for any closing remarks I just want to thank you all. As we said, we're excited about the year, look forward to talking through the year, and look forward to delivering on the guidance that we've set forth. Thanks, everyone. Thank you.