Company: EPR-PE
Filing Date: 2025-07-31
Form Type: 10-Q
Source: 0001045450-25-000120
Chunk: 36

Company: EPR PROPERTIES
Filing Date: 2025-07-31
Form: 10-Q
Item: Part I, Item 1
Chunk 36
---
 uses interest rate swaps, cross-currency swaps and foreign currency forwards.

12

Cash Flow Hedges of Interest Rate RiskThe Company uses interest rate swaps as its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt or payment of variable-rate amounts from a counterparty, which results in the Company recording net interest expense that is fixed over the life of the agreements without exchange of the underlying notional amount.At June 30, 2025, the Company had one interest rate swap agreement designated as a cash flow hedge of interest rate risk. The interest rate swap agreement outstanding as of June 30, 2025 is summarized below: Fixed rateNotional Amount (in millions)IndexMaturity2.5325%$25.0 USD SOFRSeptember 30, 2026The change in the fair value of interest rate derivatives designated and that qualify as cash flow hedges is recorded in accumulated other comprehensive income (AOCI) and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings within the same income statement line item as the earnings effect of the hedged transaction. Amounts reported in AOCI related to derivatives will be reclassified to interest expense as interest payments are made on the Company’s variable-rate debt. As of June 30, 2025, the Company estimates that during the twelve months ending June 30, 2026, $15 thousand of losses will be reclassified from AOCI to interest expense.Cash Flow Hedges of Foreign Exchange RiskThe Company is exposed to foreign currency exchange risk against its functional currency, USD, on CAD denominated cash flow from its six Canadian properties. The Company uses cross-currency swaps to mitigate its exposure to fluctuations in the USD-CAD exchange rate on cash inflows associated with these properties, which should hedge a significant portion of the Company's expected CAD denominated cash flows. As of June 30, 2025, the Company had the following cross-currency swaps: Fixed rateNotional Amount (in millions, CAD)Annual Cash Flow (in millions, CAD)Maturity$1.35 CAD per USD$170.0 $15.3 December 1, 2026$1.35 CAD per USD90.0 8.1 December 1, 2026$260.0 $23.4 The change in the fair value of foreign currency derivatives designated and that qualify as cash flow hedges of foreign exchange risk is recorded in AOCI