INVESTING IN LIFE’S ENDURING EXPERIENCES INVESTOR PRESENTATION – JUNE 2017 AMC THEATRE – COLUMBIA, MD BASIS INDEPENDENT SCHOOL – BROOKLYN, NY TOPGOLF – PHOENIX, AZ DATA IN THIS PRESENTATION IS AS OF 3/31/17 UNLESS OTHERWISE NOTED
DISCLAIMER Statements made in this presentation may constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements relate to, without limitation, the Company’s future economic performance, plans and objectives for future operations and projections of revenue and other financial items. Forward-looking statements can be identified by the use of words such as "may," "will," "plan," "should," "expect,” "anticipate," "estimate," "continue" or comparable terminology. Forward-looking statements are inherently subject to risks and uncertainties, many of which the Company cannot predict with accuracy and some of which the Company might not even anticipate. Although we believe that the expectations reflected in such forward-looking statements are based upon reasonable assumptions at the time made, we can give no assurance that such expectations will be achieved. Future events and actual results, financial and otherwise, may differ materially from the results discussed in the forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements and are advised to consider the factors listed under the headings "Risk Factors" in the Company’s Annual Report on Form 10-K, as may be supplemented or amended by the Company’s Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. The Company assumes no obligation to update and supplement forward-looking statements that become untrue because of subsequent events, new information or otherwise. Definitions and reconciliations of the non-GAAP financial measures used in this presentation are available in our investor supplemental dated March 31, 2017 available on our website at www.eprkc.com. 2
COMPANY OVERVIEW
EPR PROPERTIES EPR IS A TRIPLE NET LEASE REIT, SPECIALIZING IN SELECT, NON-COMMODITY REAL ESTATE SEGMENTS THAT ARE HIGHLY ENDURING COMPANY SNAPSHOT * LONG-TERM OUTPERFORMANCE ** NYSE: EPR, FOUNDED: 1997 LIFETIME TOTAL SHAREHOLDER RETURN $8.4B TOTAL MARKET CAP $5.7B EQUITY, $2.7B DEBT $6.2B+ TOTAL INVESTMENTS 368 PROPERTIES, 43 STATES, DC & CANADA * As of March 31, 2017, adjusted for CNL Transaction which closed subsequent to quarter end. **Source: SNL, dates 11/18/1997 through 3/31/17 PRIMARY INVESTMENTS SEGMENTS ENTERTAINMENT RECREATION EDUCATION 4
INVESTMENT THESIS AND CORE STRATEGIES INVESTMENT THESIS CORE STRATEGIES DIFFERENTIATED INVESTMENTS LONG TERM STRONG RELATIONSHIP-BASED GROWTH PIPELINE KNOWLEDGE DRIVEN WELL CAPITALIZED BALANCE SHEET FEWER CATEGORIES GREATER DEPTH UNDERLYING INVESTMENT SEGMENT STRENGTH TRIPLE NET STRUCTURE CONSISTENT COVERAGE 5
HUMAN CAPITAL OUR ORGANIZATIONAL DESIGN REFLECTS OUR SEGMENT FOCUS Builds centers of knowledge in each Creates competitive advantage to of our primary segments identify key market trends EXECUTIVE MANAGEMENT CHIEF INVESTMENT OFFICER ENTERTAINMENT RECREATION EDUCATION GROUP GROUP GROUP 6
EXPERIENCE EVOLUTION ARTS, ENTERTAINMENT AND RECREATION INDUSTRY MILLENNIALS CONTRIBUTION TO US GDP Total Industry Output (IN TRILLIONS) As a percent of Total US GDP Output $1.4 4.1% 75.4M 4.0% $1.2 3.9% people aged 18-34 3.8% $1.0 3.7% LARGEST 3.6% population segment $0.8 3.5% 2010 2011 2012 2013 2014 2015 Source: US Bureau of Economic Analysis (BEA) they value EXPERIENCE “We are on the threshold… of the EXPERIENCE ECONOMY , a new economic over era in which businesses must orchestrate OWNERSHIP memorable events for their customers.” - The Experience Economy Source: US Census Bureau 7
PORTFOLIO
PORTFOLIO DETAIL 3/31/17 NOI * PROPERTY TYPE PROPERTIES % of TOTALS % LEASED (IN MILLIONS) MEGAPLEX THEATRES ** 142 209.8 41.7% 100.0% ENTERTAINMENT RETAIL CENTERS (ERCS) 8 42.7 8.5% 96.2% FAMILY ENTERTAINMENT CENTERS (FECS) 8 9.2 1.8% 100.0% TOTAL ENTERTAINMENT 158 261.7 52.0% 99.3% GOLF ENTERTAINMENT COMPLEXES 25 49.5 9.8% 100.0% METROPOLITAN SKI AREAS 11 21.6 4.3% 100.0% ATTRACTIONS (WATERPARKS) 5 30.6 6.1% 100.0% OTHER RECREATION 5 4.0 0.8% 100.0% TOTAL RECREATION 46 105.7 21.0% 100.0% PUBLIC CHARTER SCHOOLS 67 76.2 15.2% 98.0% PRIVATE SCHOOLS 13 26.6 5.3% 100.0% EARLY CHILDHOOD EDUCATION 53 25.0 5.0% 100.0% TOTAL EDUCATION 133 127.8 25.5% 98.5% ADELAAR 1 7.5 1.5% N/A TOTAL OTHER 1 7.5 1.5% N/A TOTAL 338 $502.7 100% 99.2% * Represents annualized GAAP NOI – see supplemental for quarter ended March 31, 2017 for definitions and reconciliation of certain Non-GAAP financial measures ** Excludes 8 theatres in ERC’s 9
CNL LIFESTYLE PROPERTIES TRANSACTION EPR acquired from CNL Properties (CNL) the Northstar California Ski Resort and attractions portfolio, and provided OVERVIEW debt financing to funds affiliated with Och-Ziff Real Estate (OZRE) for the remainder of CNL’s ski portfolio. TIMING Closed on April 6, 2017 following shareholder approval NORTHSTAR AND ATTRACTIONS PORTFOLIO EPR acquired Northstar and 15 attractions assets (waterparks and amusement parks) for $455.5M (9.35% cap rate) OZRE SKI PORTFOLIO OUTCOMES EPR provided approximately $251.0M of five year financing at 8.5% for 14 ski and mountain lifestyle resorts acquired by OZRE for $374.5M FINANCING Over 90% of EPR’s $706.5M investment was financed with common shares. Unless otherwise indicated throughout document: A) Purchase price does not include pro-rations, transactions costs or closing adjustments 10 B) Amount of the OZRE note does not include any other future advances C) Attractions portfolio information excludes 5 FECs that account for less than 1% of transaction and were sold at closing
CNL LIFESTYLE PROPERTIES TRANSACTION NORTHSTAR CALIFORNIA • Leading regional destination mountain resort and retail village, with a proven operator, Vail Resorts • 5-year average rent coverage of ~1.6x * • Year round resort with extensive co-investments RETAIL VILLAGE MOUNTAIN RESORT ATTRACTIONS PORTFOLIO • Geographically diverse portfolio of 15 market- leading waterparks and amusement parks • Strong performance with underwritten 5-year average rent coverage of ~1.8x ** PACIFIC PARK - SANTA MONICA WET N WILD PHOENIX OZRE SKI PORTFOLIO • 14 market-leading ski & mountain resorts across 9 states and B.C. Canada • 1 conservatively structured note at 8.5% interest rate, 65% LTV, cross-collateralized and ~2.5x underwritten coverage *** BRIGHTON - UTAH OKEMO - VERMONT *Historical EBITDAR/Historical Cash Minimum Rent Source: CNL Lifestyle Properties 11 **EBITDAR / Pro Forma Cash Minimum Rents ***Property-Level Rent / Mortgage Interest Payment
CNL TRANSACTION IMPACT TOTAL INVESTMENTS * PRO FORMA TOTAL INVESTMENTS ** Education Other Education Other 22% 3% 25% 3% $5.5B+ $6.2B+ Recreation Recreation 23% 32% Entertainment Entertainment 49% 43% RECREATION PORTFOLIO RECREATION PORTFOLIO (as of 3/31/17) (Pro forma after CNL Transaction) Property # of $ Invested Property # of $ Invested Types Properties (in millions) Types Properties (in millions) Topgolf 25 $568 Topgolf 25 $568 Ski Areas 11 $257 Ski Areas 26 $658 Attractions 5 $356 Attractions 20 $683 Other Recreation 5 $50 Other Recreation 5 $50 * As of 3/31/17 12 ** As of March 31, 2017, adjusted for CNL Transaction which closed subsequent to quarter end.
FOCUSED GROWTH TOTAL INVESTMENTS * (IN MILLIONS) OTHER $6,208 179 RECREATION $5,501 $5,307 EDUCATION 179 178 1,937 $4,606 ENTERTAINMENT 1,231 1,148 203 $4,040 $3,562 207 944 $3,120 $3,211 696 212 1,388 1,388 $2,969 1,303 $2,844 267 550 $2,717 1,006 395 335 728 421 $2,271 382 318 342 538 337 374 280 230 312 234 286 174 2,678 2,704 2,704 2,453 2,411 2,262 2,177 2,148 2,011 1,976 1,926 1,925 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Q1 2017 Q1 2017 Pro Forma * Total Investments is a Non-GAAP financial measure. See investor supplemental for quarter ** ended March 31, 2017 or Form 10-K’s as applicable for reconciliation of certain Non-GAAP financial measures ** Pro Forma reflects the addition of $706.5M to Recreation as a result of the CNL Transaction 13
PROPERTY MAP * GEOGRAPHICALLY DIVERSE PORTFOLIO * As of March 31, 2017, adjusted for CNL Transaction which closed subsequent to quarter end. 14
DISTINCTIVE COMBINATION OF LEASE CHARACTERISTICS CROSS DEFAULT/ DURATION 11+ YEARS CREDIT SUPPORT UNIQUE COMBINATION STRONG RENT ESCALATORS COVERAGE GENERALLY 2% OR 10% PARTICIPATING RENT/ INTEREST EVERY FIVE YEARS 15
CONTINUING TREND OF REDUCED CONCENTRATION Top 5= 64% 70% 5% 60% Percent of Total Revenue 7% 5% Top 5= 46% 50% 6% 5% 7% 9% 8% Premier Parks 6% 4% 8% 8% 9% Peak Resorts 40% 7% 8% 9% 8% 7% 9% 9% Topgolf 9% 10% 6% 30% 8% Cinemark 7% 4% 8% 6% 20% Regal 34% 29% Rave 25% 23% 23% 20% 10% 20% Imagine 0% AMC FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 Q1 2017 Post CNL * Transaction * As of March 31, 2017, adjusted for CNL Transaction which closed subsequent to quarter end. 16
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