Good afternoon, ladies and gentlemen, and welcome to the First Quarter 2016 EPR Properties Earnings Conference Call. Participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. [Operator Instructions] As a reminder, this conference call is being recorded. I would now like to turn the conference over to your host, Mr. Brian Moriarty, Vice President of Communications.

Thank you, operator. Thank you for joining us today. I'll start to call by informing you that this call may include forward-looking statements as defined by the Private Securities Litigation Act of 1995, identified by such words as will be, intend, continue, believe, may, expect, hope, anticipate, or other comparable terms. The company's actual financial condition and results of operations may vary materially from those contemplated by such forward-looking statements. A discussion of these factors that could cause results to differ materially from those forward-looking statements are contained in the company's SEC filings, including the company's reports on Form 10-K and 10-Q. Now, I'll turn the call over to company President and CEO, Gregory Silvers.

Thank you, Brian, and good afternoon to everyone. I'd like to remind everyone that slides are available to follow along via our Web site at www.eprkc.com. With me on the call today are the company’s CFO Mark Peterson.

Good afternoon.

And CIO Jerry Earnest.

Good afternoon.

I'll start with our quarterly headlines and then pass the call to Jerry to discuss the business in greater detail. Our first headline, top line and earnings growth highlight business strength. As compared to the same quarter of the previous year, we achieved 19% growth in revenue and 15% growth in FFO as adjusted per share results. This established a strong momentum for us as we start the year. Next, solid investments spending across segments. This highlights the consistent opportunities illustrated in each of our primary invested segments, along with the durability of each of our tenant segments. Jerry will have more to say about this in his comments. Our third headline is Montreign gaming license activated at Adelaar. The gaming license became effective in March upon the deposit of bonds with the New York State Gaming Commission and payment by Montreign of its $51 million licensing fee to the gaming commission. We are excited to have met these key milestones as we move forward in creating value with the Adelaar property. Construction is well underway on the casino resort property and you can view and monitor the extend of the progress by going to www.montreign.com and clicking construction cam icon. Our fourth headline is recognition of the experience economy. Much has been written lately about the recognition of a demographic shift from an economy of stuff to an economy of experience. All we can say is welcome. Our tenants and operators provide many of the most innovative congregate experiences available whether it’s enhanced theaters, Topgolf, ski properties, waterpark adventure lodges or education facilities. We are beginning to see an increased awareness to the resiliency and dependability of these types of properties. As more people, businesses and investors recognize these demographic shifts, we expect greater opportunities for EPR to deploy capital and for our investors to realize the value of these investments. Our last headline is well positioned with strong balance sheet. As Mark will discuss, we’re at the lower end of our target leverage range on a net debt to adjusted EBITDA basis and our balance sheet provides a strong foundation for our anticipated investment spending. With a solid balance sheet, flexible access to capital and a deep investment pipeline, we feel that we’re well positioned to deliver the results that you value. With that, I'll turn it over to Jerry to discuss our investments and rejoin you for questions later.

Thank you, Greg. We began the year with strong investment spending of a $145.1 million in the first quarter. The quarter spending pace and composition reflects our discipline balance in opportunity across our three primary investment segments. In the entertainment segment, the theater exhibition business started the first quarter with strong performance. Box Office revenues were up 7.8% year-to-date over last year. However as we indicated on our previous earnings call, we do not expect such outperformers to continue during the full year of 2016. As of today, we still expect the box office to be relatively flat with the year overall, reflecting more of a transition year when compared with the outstanding movie schedule in 2015. With much of the franchise content being released in two year cycles, we expect robust box office revenues in 2017. Subsequent to quarter end we received a payoff of the $44 million mortgage note associated with North Carolina Music Factory. During the quarter, we advanced approximately $22 million pursuance of the contractual terms of the note and mortgage. However, we’ve made it clear that our underwriting would not allow us to advance beyond that level. Our borrower had significant plans to expand the project into a mixed used development to include office and hospitality. Given that such a development does not fit within our established business strategy, we permitted the borrower to repay the existing debt. Subsequent to quarter close, given the success of the existing project and the high level of interest in the future development, the borrower entered into a new loan and fully repaid our outstanding balance. For the quarter, investment spending in our entertainment segment was a total of $47.7 million, consisting primarily of investments in three build-to-suit theaters, redevelopment of three existing theaters, investment in one entertainment retail…

Thank you, Jerry. I'd like to remind everyone on the call that our quarterly investor supplemental can be downloaded from our Web site. We called our last quarter we introduced new schedules in our supplemental to facilitate calculations of net asset value. Note that this quarter as part of the schedule found on page 26, we added a bit more detail related to other NAV components from our balance sheet. We hope you find this additional information useful. Now, turning to the first slide. FFO for the first quarter increased to $73.8 million from $32.1 million in the prior year. FFO per share was $1.17 this quarter compared to $0.56 in the prior quarter. FFO as adjusted for the quarter increased to $74.2 million versus $59 million in the prior year and was $1.18 per share for the quarter versus $1.03 per share in the prior year, an increase of 15%. Now, let me walk through the key line item variances for the quarter versus the prior year. Our total revenue increased 19% compared to the prior year to another record quarterly amount of $118.8 million. Within the revenue category, rental revenue increased by $17 million versus the prior year to $93.4 million and resulted primarily from new investments. Percentage rents for the quarter included in rental revenue were $610,000 million versus $270,000 in the prior year. The increase was primarily due to $368,000 in percentage rents received related to one of our private schools. Tenant reimbursements decreased by $438,000 for the quarter due primarily to the impact of a weaker Canadian dollar exchange rate versus the prior year. Other income increased by $660,000 for the quarter versus last year and was due to favorable settlements of foreign currency swap contracts as well as an insurance recovery gain of approximately…

Thank you, Mark. The first quarter of 2016 was a continuation of our commitment to smart, discipline growth. Additionally, we’re actively managing our portfolio to not only lower risk for appropriate, but also to recycle capital and establish market place value on certain assets. These efforts will further enhance the consistency and reliability that is valued by our shareholders. As you heard today, our underlying segments were performing and growing. Our balance sheet and access to capital is strong and our investment opportunities are solid. These pillars form the foundation for our enthusiasm for the balance of the year and beyond. With that, I’ll open it up for questions.

[Operator Instructions] Your first question comes from Tony Paolone from JPMorgan. Your line is open.

Thank you. Greg, you mentioned in your opening comments that the investment pipeline is pretty deep and I was wondering if you could just put a little bit more detail around that in the past it has been pretty good at kind of walking at the next 12 months’ worth of activity pretty early on in the year, and just wondering what’s on the horizon as you look at the pipeline?

Yeah, I would tell you that I think we feel that we’re solidly in the upper 80%, 90% of what our pipeline relative to kind of known where we’re at right now. But the thing that’s interesting to us is, right now we’re seeing some real acquisition opportunities, especially as Jerry referenced in the theater area where we’re seeing these conversions, the high amenity and our willingness to understand that space and move forward with operators in there, there is really quite a bit of opportunity there. And likewise in the education space as Jerry referenced, the growth in that area is very strong. So in those two areas I would say are the primary kind of drivers.

Okay. And on the theaters side, are these theaters that have been either converted already or built or do you built to some type, yes?

I would say it’s actually the hybrid of that. It’s a former theater that’s getting bought and then converted to the new amenity. So the location is solid, it was a former traditional theater with not the luxury seating and expanded food and beverage that go along with that, and then doing the conversion, buying the theater and then converting it. So we’re seeing – if you listen to all of the other major exhibitors they’ve got major, major capital deployment plans to further this. So as they go out and look at their theaters and they’re looking for someone to do some capital along with their capital to do that conversion, a lot of landlords are not looking to do that. So if there is an opportunity to buy out the existing landlord has come in and put some capital along with the operator capital, we’re seeing some really strong opportunities in that area.

Okay, great. And in terms of on the sales side, can you give a sense as to how much you guys have in the market right now for sale and how that’s coming along?

Yeah, I think we’ve got – I think it’s pretty well known, we’ve got - we’ve talked about max exposure so we have [indiscernible] assets in the market and we’ve taken to Topgolf to the market as well primarily. I think those will have better color on those as we move into the second quarter, those just kind of went out toward the end of the first quarter and so beginning to – the interest will become more finalized as we get into that, but those are the two kind of primarily areas that we’re seeking disposition on.

Okay. And then last question on the note that you got repaid on the North Carolina loan you made, can you give us a sense as to what the IRR was on that investment?

Yeah, that was about a 9, 9.5 on that and then since that it was – it really came down to Tony, again they had an opportunity to expand their business to do something that really isn’t our business. So when they got into wanting to put an office tower, some hospitality that was more – not kind of recreational in it, like we’ve done in the past we made a decision that this is not kind of our business but these are people who have done entertainment before and done – and so we wanted to be, to the extent we could accommodating because we think there maybe opportunities with the group in the future. So we presented the ability for them to pay us off and they did, actually rather quickly, I mean it spokes to the opportunity set that they have with regard to this other properties. And hopefully as they do this project and other projects that there might be opportunities to redeploy capital with them again.

Okay, thank you.

Thank you.

Your next question comes from the line of Craig Mailman from KeyBanc Capital. Your line is open.

Hey guys. Just wanted to follow-up on the theaters, some of those conversion opportunities, are those something your existing tenants coming to you with that investment or is it the existing landlord knowing that you guys are big in this space and coming to you directly?

We’ve had some of both, Craig. I mean I would tell you that it’s a lot primarily driven by our operators because as I said, we were very close to them as a group and spend a lot of time with them but we have had the situation where an actual landlord sees it as a time to monetize and get out because one of the requirements that we have when we actually invest with an operator is to extend the term. And they’re not really – with an existing landlord they’re not willing to extend the term unless they can do this conversion, if they don’t want to put the money in then they’ll add an impasse and so we get from both of those people who are at that impasse we get opportunities with. And if it’s location that we believe in and an operator that we think and can execute on and we have faith in and we have good success with proceeding.

And any of these opportunities kind of breaking off from the potential AMC [indiscernible] or is that too early to see opportunities come from that deal?

It’s really kind of early for that, as they’ve indicated that they are – they hope to deal with that in the fourth quarter of this year is what their anticipated closing. So I think there is not really been anything that is developed from that specifically yet, but we’re hopeful that that kind of activity will spur additional opportunities.

Okay. And then in the $600 million to $650 million, just to clarify the 80%, 90% that’s what you guys think you have visibility on of the call it $625 million at midpoint?

Yeah. 60%, and Craig about 60% of that was already started and in process at the end of the first quarter.

Okay. How much of these theater acquisitions or education acquisitions are in that $625 million?

Well there is some, we always kind of have an idea of some of that kind of a 10% factor in there of opportunistic type things. And so could it be bigger than that, it could be, but that’s – it’s – when we are setting our kind of plan we generally, as you’ve seen before Craig, we have a strong 75%, 80% of that either in process or identified waiting to begin or already under construction. We have some that we think is going to start construction but the timing on that, and then we have generally a little plug for opportunistic things that will develop during the year but that’s usually 10% or so.

Okay. And then just one last one on Peak, you covered just kind of lower end of the range, you guys like to see there and now they’re coming to you for potentially some bridge financing. Is this tenant as you guys look at the credit there and watch or is it just potential near term liquidity to get the EB5 money?

Well, I think it’s really a kind of a liquidity issue in the sense that if you think about what was described they spent $12 million of their cash in an improvement on our property remember, I mean this was – that $12 million has been in Mount Snow. They also have – they paid us back $75 million roughly last year on property, so they have a substantial amount of assets and when we look at it, they had a one-two cover, I think this is an area that I think as they begin to plan, they’re looking for contingency just in case, there is something here. So I think we don’t look at it in terms of bridge, in the sense this may – this could be capital that’s just deployed for a greater period in just a short time. So they fully funded their reserves, we think they’re a good company, it’s just that there were – they’ve made some capital improvements this year and anticipation of getting their money much faster than they have. And so in that sense we think it’s prudent to – in the sense they’re improving our property to think about what role we could play.

Got you. Thanks.

Thank you.

Your next question comes from the line of Richard Moore from RBC Capital Markets. Your line is open.

Hey guys, good afternoon.

Hey Rich.

The first thing, I’m curious on the drop in investment spending a drop that’s in progress of a $112 million that was all Adelaar, is that right?

The drop – property under development, yeah we put a $154 million in service for Adelaar.

Okay, I got you. Okay, and then you guys bought one family entertainment center in the quarter, right?

Yes.

What is that again exactly?

It’s a [indiscernible] concept and so we have one – it’s a part of – they bought, we had one under that they opened and we bought and there is an opportunity for us to grow with them as they have other development opportunities.

Oh good, what all was in there exactly?

They actually – it’s a carding with a food and beverage overlay. The facility that we bought was in Atlanta, very successful, and they’ve got a proven balance sheet with some quality backing and again – when we think of FECs we look at, it’s an activity oriented and in a food and beverage overlay. And there are different activities whether that’s bowling or to a certain degree activities that – carding other activities that can be a driver for that additional food and beverage overlay and there is several operators who are doing extremely very good jobs out there with high coverages and we are kind of making investment, not investments in the operator but making real estate investments with several of these at this time.

Okay. And then is there a cap rate sort of associated with that?

It was a near – I’m looking right now, but I think it was a little right at 9.

9, okay. Okay, good thank you. And then I’m a little curious, I mean maybe I’m not exactly understanding how you guys do this, but like I was looking at the number of Topgolfs you have in the portfolio is the same this quarter as it was last quarter, I think it’s 19. You had 16 under development last quarter and this quarter you have 11 under development, I mean did we lose quite somewhere or do I just not understand what you guys did?

Five came into service this quarter. We also – yeah is that the number, we had five – if you remember from Jerry’s comments, five came in service. Now what we also had is, we added some new more in under development. So what you’re catching in the quarter is, new under development replacing those that came in service, so that’s the number, it’s not that we’re off our numbers we had more that came under development, but we also placed five in service in the quarter.

Well, I mean in fact the press release says you have 19 complexes today and you had 19 – in the beginning part it says portfolio update and then there was 19 last quarter. And so would there be 24 then in service right now or is that?

I think we had – I think what it was raised we have spending on in service assets.

Oh okay.

The 19 – and then to confuse it even more, we had one property that was underground lease that we put in service but then now it’s going to be a full build out. So you tell me how to classify that one, we’re treating that now with the build-to-suit but – so the property counts get a little confusing when you’re spending, additional spending things already in service because there are some tail spending on that. And then you have the situation where a ground lease turns into a build-to-suit, so there is a little bit of reconciliation, I’m glad I do that offline.

We have 19.

Yeah, 19 is the right number, yeah.

19 that are full opened. As Mark said, we had one project where we were just doing the ground, we were going to be a ground lease on those, so we showed that in service since we’re not going to make any improvements, Topgolf has come back to us and said, yes we’d like you to do the improvements on there, we’ve agreed to do that under our program. And so that was one that shows it was in service but now it’s going to be also have construction spending.

If you look at the lease schedule, maturity schedule, you’ll see one more lease in there that’s that ground lease, but Jerry we don’t put the – we don’t change the 19 because now it’s back under construction, so I know that’s confusing but that’s the story on that.

So Mark, you’re saying if you have 16, if you’re spending 16 that does mean 16 new projects?

That’s right.

Okay, I got you, I’m with you. Okay, then on that North Carolina loan that got paid off, was there a prepayment fee with that as well?

There was not.

There was not, okay.

There was not.

Okay, and then I think the last thing from me is, could you explain me, well I missed it, you guys were going pretty fast today that was good but did you explain why interest expense jump so much?

Yeah, it’s the combination of really a several things, less capitalized interest because we put Adelaar in service. A course increase borrowings associated with the investment growth, and then thirdly the hedge rate on our term loan popped up this quarter and then it goes back down in early 2017, just basically on the timing of the way the hedges were put in place.

Okay, great. Yeah, and there was one more thing, did you saw some charter schools in the quarter besides the one or is that…?

We had a payoff of a charter school loan that came with a prepayment fee, I mean that fee was $3.6 million, the gross proceeds on the mortgage note was $19.3 million.

Okay, but no additional sales in charter schools?

No.

No, we did have one subsequent in the quarter that’s the one I talked about in guidance for next quarter, that’s for $12 million and there is a termination fee associated with that but it’s in our guidance and everything but that happen subsequent to the end of quarter for $12 million.

Okay, all right great. Thank you guys.

Thank you, Rich.

I’m showing no further question at this time. I would now like to turn the conference back to Gregory Silvers.

Well, thank everyone for joining us today. We appreciate your interest. If you have any further questions, please don’t hesitate to reach out to us and we look forward to talking to you next quarter. Thank you.

Thank you.

Ladies and gentlemen, this concludes today's conference. Thank you for your participation and have a wonderful day. You may all disconnect.