EPR Properties (EPR) 10-K 2016 FY Annual report

EXHIBIT 12.2

EPR PROPERTIES

COMPUTATION OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED DIVIDENDS

(Dollars in thousands)

	Year Ended December 31,
	2016			2015			2014			2013			2012
Earnings:
Income before equity in income from joint ventures and other items (1)	$	219,601		$	170,017		$	177,278		$	152,193		$	140,881
Fixed charges before preferred dividends	108,068			98,672			88,996			83,988			77,738
Distributions from equity investments	816			540			810			985			1,046
Capitalized interest	(10,697		)	(18,547		)	(7,525		)	(2,763		)	(859		)
Adjusted Earnings	$	317,788		$	250,682		$	259,559		$	234,403		$	218,806
Fixed Charges:
Interest expense, net (including amortization of deferred financing fees)	$	97,144		$	79,915		$	81,270		$	81,056		$	76,656
Interest within rental expense(2)	227			185			174			145			156
Interest income	—			25			27			24			67
Capitalized interest	10,697			18,547			7,525			2,763			859
Preferred dividends	23,806			23,806			23,807			23,806			24,508
Combined Fixed Charges and Preferred Dividends	$	131,874		$	122,478		$	112,803		$	107,794		$	102,246
Ratio of Earnings to Combined Fixed Charges and Preferred Dividends	2.4		x	2.0		x	2.3		x	2.2		x	2.1		x

(1)

Earnings before equity in income from joint ventures and other items for the year ended December 31, 2016 includes $0.9 million in costs associated with loan payoff. Earnings before equity in income from joint ventures and other items for the year ended December 31, 2015 includes $18.6 million of retirement severance expense and $0.3 million in costs associated with loan payoff. Earnings before equity in income from joint ventures and other items for the year ended December 31, 2014 includes $3.8 million in provision for loan losses and $0.3 million in costs associated with loan payoff. Earnings before equity in income from joint ventures and other items for the year ended December 31, 2013 includes $6.2 million in costs associated with loan refinancing and a $4.5 million gain on early extinguishment of debt. Earnings before equity in income from joint ventures and other items for the year ended December 31, 2012 includes $3.1 million in impairment charges for properties held and used and $0.6 million in costs associated with loan refinancing.

(2)

Interest within rental expense represents one-third of rental expense (the approximate portion of rental expense representing interest).