Brian Moriarty – Vice President of Corporate Communications Greg Silvers – President and Chief Executive Officer Mark Peterson – Chief Financial Officer.

Anthony Paolone – JPMorgan Nick Joseph – Citi Mike O'Carroll – RBC Capital Markets Laura Dickson – KeyBanc Capital Markets John Massocca – Ladenburg Thalmann Ki Bin Kim – SunTrust Robinson Humphrey.

Good afternoon, ladies and gentlemen, and welcome to the Q1 2018 EPR Properties Earnings Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded. I would now like to turn the call over to your host, Mr. Brian Moriarty, Vice President of Corporate Communications..

Thank you, operator, and thanks to everyone for joining us today for our first quarter 2018 earnings call. I will start the call by informing you that this call may include forward-looking statements as defined in the Private Securities Litigation Reform 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, discussion of these factors that could cause results to differ materially from these 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, Greg Silvers..

Thank you, Brain. Hello everyone and welcome to our first quarter call. I’d like to start by reminding everyone that slides are available to follow along via our website at www.eprkc.com. With me on the call today is our CFO, Mark Peterson who will review the company’s financial summary..

Good afternoon. .

Infinity War has set the tone for the summer season with a record opening of $257 million and the balance of the summer slight looks strong as well. This performance continues to demonstrate that when the studios produced compelling content, there is no doubt that people want to consume that content in the theater.

We continue to be encouraged by the results of our theater tenants converting more of their circuits to high amenity theaters. For example, the three largest public company operators in the U.S. reported year-over-year food and beverage per cap growth ranging from 5% to 9% last year.

I would also like to relate to the optimistic tone of last month CinemaCon Conference, which annually brings together all the key players in the movie exhibition industry, including EPR.

One highlight of particular note was Disney’s commitment to not materially change the release window for first-run movie theater exhibition, which is exactly the outcome that we expected when this issue bubbled up again last year.

At quarter-end, our recreation portfolio included over $2.2 billion of total investments with four properties under development, 86 properties in service and 21 operators. Our occupancy was 100% and our rent coverage was approximately 2.08 times.

Investment spending in our Recreation segment totaled approximately $62 million during the first quarter, which included $21.6 million on the Kartrite Waterpark Hotel in the Catskills and $18.1 million of new investments in the fitness space with the balance being primarily of build-to-suit development of golf entertainment complexes and attractions.

Yesterday, we received a substantial paydown on our $240 million ski property mortgage loan with affiliates of Och-Ziff Real Estate due to Boeing’s resource purchase of the seven properties they leased from Och-Ziff Real Estate.

In exchange for our release of the mortgage of these assets Och-Ziff paid down a $150.8 million of allocated loan principal on the seven properties, along with an additional principal paydown of $24.6 million.

Additionally, our loan requires interest to be paid through the end of fourth year of a loan term, which represents approximately $45 million of prepayment fees. In summary, we received a total cash payment of approximately $221 million.

The remaining carrying value of the loan is now approximately $74 million and our unlevered IRR is over 29% on this transaction. Och-Ziff may choose to make additional paydowns of the note, but such paydowns are completely at their discretion and subject to the prepayment requirements of our mortgage note.

The operators in our ski portfolio have delivered solid results this season and all of our ski customers have fully funded their off-season reserves. Visits in revenue through March, were up 9% and 12%, respectively versus the trailing three-year average, due in large part to significant outperformance at the resorts in the Pacific Northwest.

Additionally, the Coldspring allowed many tenants to extend their operating season by a few weeks and make up for days lost to unfavorable weather in the early part of the season. We will provide an update on the full ski season on our next call.

As many of you are well aware, as part of our recent bond offering, we updated our Risk Factors to reflect the recent indictment brought against one of our borrowers in certain individuals affiliated with the Schlitterbahn Waterpark in Kansas City, Kansas. As this is an ongoing legal matter, we are very limited what we can say about the situation.

However, we can say that our mortgage notes are secured by two very successful Texas water-parks, along with the Park in Kansas City, Kansas and that the annual debt service obligation has historically been covered by the EBITDA from the two Texas parks.

At quarter-end, our education portfolio included over $1.4 billion of total investments with eight properties under development, 146 properties in-service and 59 operators. Our occupancy was 98% and our rent coverage was 1.51 times.

Investment spending in our Education segment totaled $21.1 million, primarily consisting of $8.4 million for the acquisition of two Early Childhood Education centers with the balance being primarily build-to-suit development and redevelopment of public charter schools, early childhood education centers, and private schools.

On the disposition side, we were fully repaid on a $10.5 million of mortgage loans during the quarter with a weighted average rate of 7.4%. In March, we entered into an agreement with our Early Childhood Education tenant, Children’s Learning Adventure. This agreement provides that CLA will make rent payments to EPR.

These payments were $750,000 per month for the months of March, April and May and will be $1 million for the months of June and July. Failure to make these payments will result in the immediate termination of the leases. All leases will terminate on July 31 unless terminated earlier for failure of payment.

CLA has made the payments for March, April and May. Accordingly, we have updated our portfolio occupancy reporting to reflect all open CLA sites as leased. We believe this agreement allows CLA and their prospective partners, ample time to execute a restructuring in advance of the July 31st termination date of our leases.

Please note that the midpoint of our earnings guidance does not reflect rents on these properties after July. If CLA is not able to execute on a restructuring, we will have the ability to regain possession and lease our properties to an alternative operator as several parties have expressed interest in our diversified portfolio of 21 open schools.

Moving to our disposition and investment spending guidance. Our disposition guidance remains unchanged at $350 million to $450 million. However, we now know that $220 million – $221 million of this range will be realized from the previously discussed paydown of our ski loan to Och-Ziff Real Estate.

We expect the remaining of our – the remainder of our disposition volume to come primarily from our Education segment, which will include the $10.5 million realized during Q1, along with the sale of public charter schools pursuant to tenant purchase options.

As Mark will discuss in his comments on our earnings guidance, we are reducing expectations for the dollar volume of charter school tenants exercising their purchase options, which will result in lower expected charter school terminations fees.

We will also pursue disposition on opportunistic basis in our Entertainment and Recreation segments to take advantage of the continued strength of the private market. We are reiterating our investment spending guidance range of $400 million to $700 million.

We will only grow our investment spending towards the top end of our range if we significantly exceed the top end of our disposition guidance range or if we find attractive investment opportunities that work with our cost of capital.

We are not believers in growth for growth’s sake and we will remain disciplined in our underwriting and allocate capital prudently in a manner that drives shareholder value. With that, I’ll turn it over to Mark for a discussion of the financials and then I’ll rejoin you later..

Thank you, Greg. And I’d like to remind everyone on the call that our Quarterly Investor Supplemental can be downloaded from our website. Now turning to the first slide. Net income for the first quarter was $23.5 million or $0.32 per share compared to $48 million or $0.75 per share in the prior year.

FFO was $61 million compared to $73.9 million in the prior year. Lastly, FFO as adjusted for the quarter increased to $94 million versus $76.5 million in the prior year and was $1.26 per share versus $1.19 per share in the prior year, an increase of 6%.

Before I walk through the key variances, I want to discuss one adjustment to FFO that come to FFO as adjusted. As previously announced, we completed the redemption of our 7.75% inaugural senior unsecured notes originally due in 2020 for the outstanding principal amount of $250 million plus a premium for the terms of the indenture of $28.6 million.

The premium along with the $3.3 million write-off of noncash deferred financing costs are classified as costs associated with loan financing or payoff in our income statement and are added back to FFO to get to FFO as adjusted.

Subsequent to quarter end, we were pleased to replace this debt with the new 10-year senior unsecured notes at a much lower interest rate. I’ll discuss this issuance later in my comments. Now, let me walk through the key line item variances for the quarter versus the prior year.

Our total revenue increased 20% compared to the prior year to $155 million. Within the revenue category, rental revenue increased by $21.9 million versus the prior year to $128.9 million. This increase resulted primarily from rental revenue related to new investments, including those assets purchased in the CNL transaction in April of 2018.

As Greg mentioned, we also recognized $750,000 in revenue related to Children’s Learning Adventure during the quarter, a decrease of $2 million versus the prior year. Percentage rents for the quarter included in rental revenue were $1.3 million versus $850,000 in the prior year.

This increase was due to percentage of rents related to several recreation properties and two private schools. Mortgage and other financing income was $21.4 million for the quarter, an increase of approximately $3.8 million versus the prior year.

In addition to other lending activities, recall that we funded a $251 million mortgage note receivable with Och-Ziff Real Estate in the second quarter of 2017 in connection with the CNL transaction.

Offsetting this increase, midway during the first quarter Endeavor Schools exercised their right to convert their $143 million mortgage note secured by 28 early education and private school properties into a master lease arrangement. There was no gain or loss on conversion.

Our monthly cash payment and term are unchanged and our financials from the date of conversion now reflect real estate assets and rental income instead of a mortgage note receivable and interest income.

On the expense side, our property operating expense increased by $1.2 million versus the prior year due to approximately $650,000 in real estate taxes paid on behalf of CLA as well as higher property operating expenses at our multi-tenant properties.

G&A expense increased to $12.3 million for the quarter compared to $11.2 million in the prior year due primarily to increases in our payroll and benefit costs, professional fees and franchise taxes. Now 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 strong and improving with fixed charge coverage at 3.2 times, debt service coverage at 3.7 times and interest coverage at 3.7 times. And at quarter-end, our net debt-to-adjusted-EBITDA ratio was higher than our targeted range for this measure at 5.8 times.

However, we’ve reduced our net debt subsequent to quarter end in conjunction with the OZRE prepayment discussed by Greg, and we anticipate additional dispositions over the remainder of 2018. These dispositions along with free cash flow are expected to have the impact of reducing this ratio.

Lastly, we increased our monthly common dividend by almost 6% in the first quarter to an annualized dividend of $4.32 in 2018. This marks the eighth consecutive year with a significant dividend increase. Now let’s turn to the next slide for a capital markets and liquidity update.

At quarter-end, we had total outstanding debt of $3.1 billion, of which $2.5 billion is either fixed rate debt or debt that has been fixed through interest rate swaps with a blended coupon of approximately 4.6%. We had $570 million drawn at quarter end on our $1 billion line of credit and $24.5 million of unrestricted cash on hand.

In addition to completing the redemption of our 7.75% senior notes during the quarter, we prepaid in full a secured mortgage note payable of $11.7 million. After these paydowns, we are pleased with the fact we have managed our debt maturity laddering such that we have no debt maturities until 2022 and manageable debt maturities thereafter.

Subsequent to quarter end, we issued $400 million of 10-year senior unsecured notes at a coupon of 4.95%. The proceeds of which were used to reduce our line of credit. Strong investor demand allowed us to upsize the amount and take advantage of an attractive interest rate.

We think extending our average debt duration makes a lot of sense in today’s rising interest rate environment. Turning to the next slide. We are pleased to announce that we are increasing our guidance for 2018 FFO as adjusted per share to a range of $5.75 to $5.90 from a range of $5.23 to $5.38.

As Greg mentioned, we are confirming our guidance for investment spending of $400 million to $700 million and disposition proceeds of $350 million to $450 million. Guidance for 2018 is detailed on page 28 of our supplemental. Turning to the next slide.

Given the number of changes impacting our increased earnings guidance, I thought it will be helpful to provide a road map from the previous midpoint of FFO as adjusted per share guidance to the current midpoint.

Starting with the previous midpoint of 531 [ph], we have the impact of $45 million prepayment fee from OZRE received in the second quarter, offset by the impact of further dilution from our convertible preferreds of $0.03 for a net impact of $0.58 per share, and then subtract the lower termination fees related to education properties of $0.13 per share for a net $0.45 per share increase related to prepayment and termination fees.

Next, we had the impact of the expected CLA payments through July, net of expenses of $0.05 per share and subtract to $0.01 related to increase and expected G&A expense related primarily to professional fees. Finally, there is a positive $0.02 benefit related to other items, such as the expected mix and timing of investments.

While the net impact of approximately $0.58 per share from the prepayment fee from OZRE will be in our second quarter earnings. As I mentioned, last quarter, we expect prepayment fees and termination fees associated with public charter school properties to occur predominantly in the back half of the year.

Note also while our 2018 guidance is unchanged for percentage rents and participating interest, these amounts are historically lower in the first half of the year than in the second half of the year and we continue to expect the same for 2018. Now with that, I’ll turn it back to Greg for his closing remarks..

Thanks, Mark. I want to make a final comment regarding our potential for growth in our existing segments.

We’ve recently been on the road with existing and potential tenants and whether there product type is theater exhibition, live performance venues, amusement and water parks or recreation hospitality, the main theme of our discussions were the continued consumer enthusiasm for their experiential products.

This demand translates in the opportunity for EPR and we expect this opportunities that to grow as more and more companies turn into this consumer preference.

As a leading provider of real estate capital for entertainment and recreational assets, we are well positioned to ride this wave of opportunity as the consumer transformation continues to gain momentum.

With that, why don’t I open it up for questions?.

[Operator Instructions] Your first question comes from the line of Anthony Paolone from JPMorgan. Your line is open..

Thanks. Good afternoon. Just questions on CLA.

Can you just walk through baked again what the processes to get beyond July like what do they need to do, just have to confirm like the creditor committee or just what are the [indiscernible] we should be looking out for?.

From our standpoint, Tony, we entered into this agreement to kind of not be so much subject to the bankrupt, the bankruptcy court has approved this agreement. So the leases, we will either get a restructuring or the leases will terminate and then we will pursue getting possession in state court.

So by July 31, without our consent, they will no longer be part of the jurisdiction of the bankruptcy court..

So that gives you – so basically if you now and then, you guys have to figure it out with them?.

Yeah. Yes, that’s exactly correct..

Okay. And I guess – I think from your comment, you said that the income was down $2 million year-over-year in the first quarter and you had recognized $750,000 in March.

So I guess, does that mean they were at $2.75 million that kind of used to be what they paid quarterly?.

That’s what we recognized in the first quarter of 2017. I will say $1.9 million was cash, $800,000 was straight-line. So that’s how you get to the $2.7 million from prior year..

Got it. Okay. And then I knew, let me just do to what you can price down Schlitterbahn, can you just talk about little bit about the collateral behind the loan you said, two parks in addition to the KC Park, do those parks have debt on it? Or could you just take those or how that’s….

No. Those parks are – we are the only obligation with regard to those parks. So, they’re free and clear other than the obligation to EPR. And as I said historically, those parks have serviced the debt service related to our obligation. I have a sufficient EBITDA to service the debt service for our obligation. So, they’ve been very successful parks..

Okay.

And where does – where’s that show up on the major tenant was that or is it not part of the major tenant list at this point?.

They’re outside the top 10 at this time..

Okay. Got it. And then just last question. You mentioned not growing for growth’s sake and just making sure that the appropriate investment returns are there.

I think if these levels to start somewhere in the mid-to-high 7s in product cap rates, where do you think investment returns need to be if you would just get a little bit more motivated to do deals?.

Probably, in the mid-8s, an initial cash on cash yield with some growth that kind of gives us that kind of 100 basis point spread with growth from there, Tony..

Is that not easy to get at this point?.

It’s – we’re able to – uncertain deals that were either sourcing or – that we’re playing a bigger role other than capital. Like I said, there is a lot of products that’s probably available in the low-8s. So again, we’re getting close to that number. But again, we’re being probably very judicious with our capital and not reaching for those deals..

Okay. Got it..

Thank you..

Thanks..

Your next question comes from the line of Nick Joseph from Citi. Your line is open..

Thanks.

Just going back to Schlitterbahn, is there an indication that the next tranche of sales tax revenue bonds will either be delayed or not approved by the state or local government?.

Right now, we don’t have any additional information on that Nick, again, that’s those really work through our tenant. And so I think they continue to work to line up tenants to make those available for that. But we’ve had no indications either for or against the fact that those are going to be impacted. .

And when would the next approval typically be? When is it expected?.

There is no formal approval. You go to the – once you have your tenants, you go and you present your package and your sales tax – you present a package of sales tax revenue generation and the corresponding bond level on that and you get approval of that assessment from both of the local and the state officials.

As far as our overall bonding capacity has already been established. Now you’re just bringing in individual projects and validating those against that original total..

Thanks.

You mentioned the opportunistic sales, mainly in recreation, is that more pricing related? Or is it exposure to any concepts or tenants? How do you think about being opportunistic there?.

Do you know, I think, we’re probably talking about. It’s not some opportunistic on raising capital, good cap rate opportunities where the private market is at a significant or willing to pay a significant premium revenue to what we are being valued at and our ability to recycle that capital relative to our existing public market cost of capital..

Thanks..

Thank you, Nick..

[Operator Instructions] Your next question comes from the line of Mike O'Carroll from RBC Capital Markets..

Yeah, thanks.

Greg, can you give us a little bit more color on what’s going on with CLA right now at the entity level? What gives you confidence that they’re going to be able to stabilize these properties? Did they get a new equity provider? Or has that ownership group changed at all?.

As we indicated, I think Michael on our last call that there were actively – they were several groups that they were actively negotiating with regard to the operating entity. They continue – it’s our understanding that they’re continuing to make progress.

We set this timeframe up both with ourselves and with those parties understanding that, that was a reasonable period of time for them to either get a restructuring done in place and we did not want to be a part of it in a long drawn out bankruptcy. So they continue to work through their issues with a new partner on the operation side.

My understanding is that they’re making progress. We hope to be able to update you more on that like I said, by the end of the second quarter. I think it’s a good element that they continue to make their payments..

I think that they’re making progress. So….

And so what did they gain out of this transaction? I guess, first, going to the bankruptcy court and trying to figure it out there.

I guess, does this extra time provide their ability to actually get agreement with you guys done?.

Well, again, for us, it gave them relief from contextually fighting motions on a periodic basis from us. Because as I said, as we talked about, we had turned our intention to be quite aggressive in the bankruptcy court to regain possession of our properties. The party that was looking at joining and investing into the operating company asked for time.

We said we needed an agreement, where we were going to get paid something during the process and we had an immediate access to our properties within a defined period of time. That we were able to successfully put that in place.

So, it removed some of the risk of the bankruptcy court of us being able to get our properties back if they are not successful. It gave us payments during the period of time and gave them a period of time to negotiate their deal. So in our situation, we felt it was a win all around for all the parties..

Okay.

So best-case scenario within the next several months, you guys could have an agreement work with them; worst-case scenario, you could get the properties back within August or September?.

Yeah. I mean, I think that’s reasonable. Because again, even though it comes out of the jurisdiction of the bankruptcy court, you then have to regain possession. So what we looked at it, Michael, we thought even if we were slugging it out in bankruptcy, the earliest that we would probably get out of that was the end of July anyway.

So with this agreement, we don’t have to continually spend legal fees in that. We’ve got an agreement that’s approved by the court. So we know what our paths are. As Mark said, we’re very hopeful that this restructuring path will be one.

They continue to pay indicating as you said they’re making progress, with that, and so, we’re hopeful that will be the path that it takes. But if not, we’re also and alternatively, as we’ve said before, shopping these with other operators, so that we can make them productive for us one way or the other..

Okay, great. Thank you..

Thank you..

Thanks..

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

Hey everyone. This is Laura Dickson here with Craig. Regarding the put option exercise by Endeavor Schools for the mortgage note agreement, it sounds like the revenue stream nets out.

is that correct?.

Yeah. I think there is additional straight-line, I believe, but the cash payments are the same. It just switches geography..

Okay. Great.

And then, for the comments about CinemaCon and Disney’s commitment not materially changed the new run window, can you elaborate us that essentially like they won’t change the new run window or?.

Yeah. They said they’re committed to the existing theatrical exhibition window. So they opened the State of The Union address with that commitment as you can imagine very, very loud applause. And again, they also said that they felt that this issue is pretty much dead.

So again, it was a nice opening to an issue that we felt was – that was the direction it would head – it was going to head, because we talked about there really isn’t not a demonstrable market for it..

Great. Okay.

And then following up on the opportunistic dispositions, how much of the disposition guidance do you expect that would be and kind of what cap rates do you think you could achieve?.

Again, what we’re seeing is, in the – actually, in the range that we have provided, we’ve said it’s really we’ve achieved the other assets and it’s going to be charter school kind of exercise or buy-out. And for opportunistic, again, I think we know where our cost of capital is. We kind of talked about kind of mid-7s.

So, something that would be below that, that would be an effective recycling cost for us, Laura, because at that point, it’s not as we could issue equity to achieve that. So it would be below that number..

Okay. And just one more from me.

For the – just wanted an update on the CIO position and backfilling that position?.

Yeah, again, as we said, right now we intend to fill that, but we have very strong segment heads that run those businesses. We don’t feel that there is any immediate rush to do that. So that we can take our time and look at both internal and external candidates.

So, we feel like we’ve got the needs of the organization addressed and we’re moving through that process, but as I said, there is no sense of urgency or emergency on that..

Okay, great. Thank you..

Thank you..

Your next question comes from the line of John Massocca from Ladenburg Thalmann. Your line is open..

Good evening everyone..

Hello. Good evening..

On their earnings call, AMC, they saw a positive $24 million impact in domestic adjusted EBITDA tied to reductions and rents related to lease modifications.

Given that, have you seen any push from your theater tenants for rent reductions? Or is that kind of noise around upgrades?.

I think that has more to do probably in the Carmike – their acquisitions of some of those, what they call their classic.

We haven’t – we’ve not been dealing with that, which like I said, I think they mentioned that they were – previously talked about that they were going to move more aggressively in some of the theaters associated with that Carmike acquisition..

So, it’s not really tied to your theater properties?.

No, no..

And then, kind of maybe, a little more theoretically, what do you think drove Och-Ziff to sell these properties, given the cost of prepaying the debt? And if it was – it was really strong potential return on what they got from Boeing, what was may be the reasoning behind you guys not holding on to the assets at the time of the purchase from CNL? Was it just Boeing wasn’t really on the radar then or was it something else with regard to that transaction?.

Again, John, what we talked about when we did that transaction was our commitment to maintain our exposure to ski at about 10%. So, actually holding that would have taken a significantly above that. So we knew they were good assets.

But again, I don’t want to speak for Och-Ziff, but I’m assuming that Boeing as part of their acquisition, they actually paid our prepayment penalty as well as a return to Och-Ziff on this.

So I think, what it really talks about is the growing’s recognition of the strength of the ski industry with what you’ve seen with what that was doing and what the KSL entity is doing, there is really a recognition of the value of those assets and they are trading at much high – at least to the operating sides are trading at much higher multiples.

And so when Boeing made an offer to buy these assets back, so they were the tenants when they made the offer to buy those, you can see kind of again, when you talk about paying off the loan, paying off the prepayment paying a profit to Och-Ziff and still making sense for them to do, it really speaks to kind of the quality of the properties, how we underwrote it and the successful execution of that transaction..

Understood. And then kind of a little bit housekeeping.

Did I hear correctly that you incurred $250,000 in taxes related to CLA in 1Q? In what amount of time did that cover?.

$650,000 worth of expenses in property taxes, property taxes related to CLA..

Okay, so $650,000.

And what period of time was that over? Was that two months or the full quarter?.

Well, we think the annual carrying cost on an annual basis, is about $1.5 million. So it’s a little disproportionately high in the first quarter, it’s about $1.5 million annually..

Okay. And that goes away with the new agreement you’ve reached, I’ll leave it until July..

Yeah. Yeah. We have some expenses in the second quarter until kind of making it through to the July date, but then we expect that to go away..

Okay. Make sense. That’s it from me. Thank you very much..

Thanks..

Thanks..

Your next question comes from the line of Ki Bin Kim [SunTrust Robinson Humphrey]. Your line is open..

Thanks. When you look at the laid land and where you can deploy capital, how does upgrading the movie theaters fix – fall into that? I was looking at your capital spending plan slide on your supplemental and it doesn’t seem like there is much for this year.

So I was curious if you could provide some color on that?.

Again, it’s still something we would do because again, it’s a double benefit in the sense that we get paid for our capital given and we also get an extension of the lease term. So that’s a good benefit.

I think what we’re seeing is though that some, at least like AMC right now has turned in its focus, if you follow their call more on their Carmike portfolio as kind of low-hanging fruit and they’ve redirected more of their capital to those properties.

We’re confident, it will come back once they get – they finished dealing with those, but they felt like they needed to respond to those properties and turn those around. But we’re still actively doing it with our other operators. We’re looking at with Regal. Regal is just going through a – they were just acquired.

So, they’re going through their process and understanding what – Schlitterbahn is understanding what they bought and where they want to go. So, I wouldn’t take this first quarter as an indication.

I think we’ve got a couple of things that are going on, but our operators are still committed to this amenitization and we feel that there is real benefit to us to be a part of that..

Okay. And some of those numbers that you gave out earlier in the call on the CLA kind of came out fast and heavy..

Okay..

So, I know there could be a chance later, but just for the sake of the time, can you just kind of put in the simple terms like what was the revenue again that you were collecting beginning of the year, up until now each month and after July 31st, if that goes to zero, right.

And what was the gross asset value at cost of those assets?.

Okay. for those, we were receiving for March, April and May, we have received $750,000 per month. And for June and July, we are scheduled to receive $1 billion per month. So that is that five-month agreement that we agreed to for the assets.

Of those 21 assets that are in – 21 assets we think it’s about $250 million of gross value associated with those assets..

Okay.

And this tenant, how much equity I mean, approximately did they actually have in those 21 assets?.

Well, and right now, in bankruptcy court, that’s a matter of dispute. So again, probably not real good for us to comment on that right now. Now what I can tell you is, they’re working with somebody to put additional equity and operational capability into it.

And as we said, we think that they’re making progress on there and hopefully, we’ll have a solution that will put this issue to – or at least will now directionally, which way we’re going..

Okay.

And just last question, going back to the water-park operator, was the original plan underwriting to get the STAR bonds to reduce your – eventually as an exit for your investment or was that just not really in the plane of options?.

No. That was considered not necessarily, but it was also considered an additional collateral support. I mean, we had the properties that would support the amount of interest that we were charging, but it also allowed for kind of multiple avenues of reducing that. And so while, again, those STAR bonds, there’s also a large land parcels out there.

So it’s not simply just the STAR bonds, you also have – we have a mortgage on a vast amount of acreage out there that underlies the tenants that would go well on to those STAR bonds. So, there’s multiple avenues of collateral there, but it underwrote with just the support of the Texas Parks..

Okay. Thank you..

Thank you..

I am showing no further questions at this time. I would now like to turn the conference back to Mr. Greg Silvers, President and CEO..

Well, we appreciate. Thank you, we appreciate your time and attention, and we look forward to seeing you all at NAREIT and talking to you again, on our next quarter call. 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..