The day after the World Health Organization declared the spread of Covid-19 a global pandemic and restaurants and movie theaters began shutting down across the U.S., an AMC movie theater and TGI Fridays restaurant in Cherry Hill quietly traded hands for $16 million.
According to property records, Cherry Hill Inn Redevelopment Partners, an LLC affiliated with a North Jersey-based real estate development company, sold the property at 2125 and 2121 Rt. 38 to EPR Properties, a Kansas City-based real estate investment trust specializing in experiential properties.
EPR (NYSE: EPR) did not return a request for comment.
EPR purchased the AMC theater and the TGI Fridays located in front of it in a deed drafted on Jan. 22, the day after the first case of Covid-19 was confirmed in the U.S. It was effective on March 12.
The development company tied to the seller, Canoe Brook Development, develops luxury multifamily properties, mostly in North Jersey and Massachusetts. The firm also did not return a request for comment. Property records show the seller has held the theater and restaurant property since it was developed in the late 1990s on the site of the former Cherry Hill Inn.
The same day the Cherry Hill property sold, EPR withdrew its 2020 earnings guidance and announced it was halting all uncommitted investment spending.
AMC Theatres is EPR’s largest tenant, representing 18% of the company’s total revenue. A new $500 million debt offering is helping AMC’s parent company stave off rumors of a potential bankruptcy, but EPR said in an update to investors Tuesday that, despite AMC’s new liquidity, it will begin recognizing revenue from AMC on a cash basis and record a non-cash write-off of $12.5 million in straight-line rent receivable for the first quarter.
Overall, EPR’s tenants have paid about 15% of contracted monthly payments for April. The firm agreed to defer payments on a month-to-month basis for all tenants that haven’t paid their April rent.
About 45% of EPR’s revenue comes from its ownership of 179 movie theaters nationwide, with a little less than a quarter coming from “eat and play” facilities like Topgolf. Attractions, experiential lodging, gaming and other facilities make up the rest of its experience-focused properties.
A small portion of EPR’s revenue stems from its ownership of private schools and early childhood education. It sold off its 47-building charter school portfolio to Rosemawr Management late last year, recording an impairment loss of $21.4 million on the sale. Part of the deal included the sale of a three-building charter school campus in Camden for $15 million, $3 million less than the property cost to develop seven years prior.
*Article courtesy of Michelle Caffrey, Philadelphia Business Journal
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