Company: EPR-PE
Filing Date: 2025-02-27
Form Type: 10-K
Source: 0001045450-25-000051
Chunk: 130

Company: EPR PROPERTIES
Filing Date: 2025-02-27
Form: 10-K
Item: Item 8
Chunk 130
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 additional opportunities in the Education segment, information provided to the CODM is separated and decisions are made based on these two operating segments. The CODM uses segment assets as reported on the balance sheet as Total Assets and Net Operating Income (NOI) before unallocated items to assess and allocate resources. NOI is calculated as total revenue (consisting of rental revenue, other income and mortgage and other financing income) less property operating expense and other expense. Revenue from both segments is derived substantially from investments structured as long-term triple-net leases or mortgages. Corporate items are not allocated to segments. See Note 18 for financial information related to these reportable segments.Rental RevenueThe Company leases real estate to its tenants under leases classified as operating leases. The Company's leases generally provide for rent escalations throughout the lease terms. Rents that are fixed are recognized on a straight-line basis over the lease term. Base rent escalations that include a variable component are recognized upon the occurrence of the specified event as defined in the Company's lease agreements. Many of the Company's leasing arrangements include options to extend the lease, which are not included in the minimum lease terms unless the option is reasonably certain to be exercised. Straight-line rental revenue is subject to an evaluation for collectability, and the Company records a direct write-off against rental revenue if collectability of these future rents is not probable. The Company recognized straight-line write-offs of $0.1 million, $0.7 million and $0.2 million for the 

71

EPR PROPERTIES Notes to Consolidated Financial StatementsDecember 31, 2024, 2023 and 2022

years ended December 31, 2024, 2023 and 2022, respectively. Straight-line rental revenue, net of write-offs, was $17.3 million, $10.6 million and $7.0 million, for the years ended December 31, 2024, 2023 and 2022, respectively.Most of the Company’s lease contracts are triple-net leases, which require the tenants to make payments directly to third parties for lessor costs (such as property taxes and insurance) associated with the properties. In accordance with Topic 842, the Company does not include these lessee payments to third parties in rental revenue or property operating expenses. In certain situations, the Company pays these lessor costs directly to third parties and the tenants reimburse the Company. In accordance with Topic 842, these payments are presented on a gross basis in