Howard Hughes Holdings Inc.® (NYSE: HHH) (the “Company,” “HHH,” or
“we”) today announced operating results for the fourth quarter and
year ended December 31, 2023. The financial statements,
exhibits, and reconciliations of non-GAAP measures in the attached
Appendix and the Supplemental Information, as available through the
Investors section of our website, provide further detail of these
results.
Full Year 2023
Highlights:
- Net loss per diluted share of
$(11.13) in 2023, including an $(11.04) per share after-tax
impairment charge at the Seaport during the third quarter
- Record Master Planned Community
(MPC) earnings before taxes (EBT) of $341 million accentuated
by record residential price per acre of $944,000 and 45% growth in
new homes sold
- Record operating asset net
operating income (NOI) of $244 million led by multi-family growth
of 16% year-over-year and strong leasing and financial performance
in office
- Ward Village® sold out all
remaining condo inventory at ‘A‘ali‘i® and Kō'ula®, and towers in
development—Victoria Place®, The Park Ward Village, Ulana, and
Kalae—were 96% sold
- Closed on $659 million of
financings, including $498 million of construction loans for
six new development projects and $161 million of
refinancings
Fourth Quarter
2023 Highlights:
- Net income per diluted share of
$0.69 in the quarter compared to $1.07 in the prior-year period,
down primarily due to the timing of condo sales in the prior
year
- Record quarterly MPC EBT of $139
million driven by a 22% increase in price per acre and complemented
by a 110% year-over-year increase in new home sales—signaling
continued strong demand for future land sales
- Sold the Memorial Herman Medical
Office Building in The Woodlands® for $9.6 million, generating
a $3.2 million gain on sale
- Closed on $85 million of
financings, extending upcoming maturities of two office and retail
loans and enabling the start of two new retail development
projects
“Howard Hughes produced outstanding results
during the fourth quarter which ultimately contributed to record
full year financial results in our MPC and Operating Assets
segments,” commented David R. O’Reilly, Chief Executive Officer of
Howard Hughes. “During a year that was overshadowed by negative
headlines and considerable uncertainty for housing and office, the
exceptional performance across HHH’s master planned communities
highlights the resilience and appeal of the company’s world-class
portfolio, as well as the strong demand we continue to see from
people and companies seeking an amenity-rich, high-quality
lifestyle in a natural setting.
“In our MPCs, a resurgence in new home sales in
HHH’s communities—which increased 45% year-over-year—led to
Summerlin® and Bridgeland® both being ranked by RCLCO among the
nation’s top five best-selling MPCs for 2023. With this heightened
demand, homebuilder interest for new land parcels increased
dramatically as the year progressed, resulting in near-record land
sales revenue in the fourth quarter with an average price of
$1.05 million per acre—an all-time high for Howard Hughes. In
2024, with mortgage rates projected to ease modestly, but not to
levels that incentivize existing homeowners to sell, we expect to
see an extraordinary market for new homes and continued strong
homebuilder demand for our residential land.
“In our Operating Assets segment, we delivered
another full year of record NOI, outpacing 2022 results by 4%
excluding dispositions. This growth was led by strong leasing
velocity at our newest multi-family developments, as well as by
solid occupancy gains and absorption within our office portfolio.
In 2023, our leasing teams executed 581,000 square feet of new or
expanded office leases, bringing our stabilized office assets to
88% leased at year-end and setting the stage for considerable NOI
growth in the coming years.
“In Hawai’i, our team delivered another
remarkable year, selling out all remaining condo inventory at
‘‘A‘ali‘i and Kō'ula and contracting to sell 78 units at our three
condo towers in pre-sales. Together with Victoria Place®—which is
fully sold out and expected to be delivered in late 2024—these
projects were 96% pre-sold at year-end and represented more than
$2.6 billion of future contracted revenue that will be
recognized as these projects are completed.
“Overall, we are extremely pleased with our
results in 2023, and we are bullish about our long-term outlook. We
see incredibly strong demand across our MPCs for our unmatched
landbank, world-class portfolio of operating assets, and premier
condo developments. The anticipated spin-off of Seaport
Entertainment later in 2024 will allow HHH to focus more
strategically on our robust pipeline of opportunities within our
communities and enable considerable growth and value creation in
the years to come.”
Click Here: Fourth
Quarter 2023 Howard Hughes Quarterly Spotlight Video
Click Here: Fourth Quarter 2023 Earnings
Call Webcast
Financial Highlights
Total Company
Full Year
- HHH reported a net loss of $551.8
million, or $(11.13) per diluted share in 2023, including an
after-tax impairment of $548.5 million or $(11.04) per share
related to the Seaport in the third quarter. This compares to net
income of $184.5 million or $3.65 per diluted share in 2022.
Excluding the after-tax impairment, the year-over-year reduction
was primarily due to the timing of condo sales as the prior-year
included the delivery of Kō'ula in Ward Village.
- In August, the Company reorganized
into a holding company structure to provide additional financial
flexibility to fund future opportunities and segregate assets and
related liabilities in separate subsidiaries. The new parent
company—Howard Hughes Holdings Inc.—trades under the ticker symbol
“HHH” on the New York Stock Exchange. HHH net income is
substantially the same as its wholly owned subsidiary, The Howard
Hughes Corporation, aside from immaterial costs incurred directly
by HHH in the current period.
- In October, HHH announced its
intent to create Seaport Entertainment—a new division expected to
include the Company’s entertainment-related assets in New York and
Las Vegas—including the Seaport in Lower Manhattan, the Las Vegas
Aviators® Triple-A Minor League Baseball team, and the Las Vegas
Ballpark®, as well as the Company’s 25% ownership stake in
Jean-Georges Restaurants and other partnerships and its 80%
interest in the air rights above the Fashion Show Mall, which are
intended to be used to create a new casino on the Las Vegas Strip.
HHH intends to spin-off Seaport Entertainment into its own publicly
traded company later in 2024, which will be led by Anton Nikodemus,
a known leader in the entertainment and resort industry.
Fourth Quarter
- Net income was $34.3 million, or $0.69 per diluted share in the
quarter, compared to net income of $52.8 million or $1.07 per
diluted share in the prior-year period.
- The year-over-year reduction was primarily related to the
timing of condo sales at Kō'ula in Ward Village during the prior
year, partially offset by increased earnings from MPC land sales
during the fourth quarter of 2023.
MPC
Full Year
- MPC EBT totaled $341.4 million in 2023, a 21% increase
compared to $283.0 million in the prior year.
- New homes sold in HHH’s communities totaled 2,289
units—representing a 45% increase compared to the prior year,
propelling Summerlin and Bridgeland to the nation’s #4 and #5 top
selling MPCs in RCLCO’s 2023 rankings, respectively.
- MPC land sales totaled $370.2 million, or a 17%
year-over-year increase, primarily related to increased residential
land sales in Summerlin, as well as a higher overall residential
price per acre in our MPCs.
- The average price per acre of residential land sold increased
23% to $944,000 per acre, a full-year record.
- MPC equity earnings were $22.7 million—representing a
$24.1 million year-over-year increase—primarily related to
Phase 2 land sales and the close-out of clubhouse condominiums at
The Summit in Summerlin.
Fourth Quarter
- MPC EBT totaled $139.3 million in the quarter, an 82%
increase compared to $76.7 million in the prior-year
period.
- New home sales totaled 527 homes—rising 110%
year-over-year—signifying strong future residential land
sales.
- MPC land sales were $193.1 million, a 65% increase
compared to the prior-year period. This improvement was primarily
driven by increased superpad sales in Summerlin and a higher
average residential price per acre.
- The average price per acre of residential land sold was
approximately $1.0 million per acre—representing a 22%
year-over-year increase and an all-time high for HHH.
- Builder price participation revenue was $15.2 million during
the quarter—representing a 24% year-over-year moderation from the
all-time highs of 2022 as fewer homes were closed with sales prices
over the predetermined breakpoints.
Operating Assets
Full Year
- Total Operating Assets NOI—including contribution from
unconsolidated ventures—was $244.4 million, representing a
$4.9 million, or 2% year-over-year increase. Excluding
dispositions, NOI increased 4%.
- Multi-family was the largest driver of the strong NOI
performance with 16% year-over-year growth predominantly due to
strong lease-up at new developments in Downtown Columbia and
Bridgeland and 9% average rent growth.
- Office NOI increased 6% year-over-year largely due to strong
lease-up activity and abatement expirations and one-time lease
termination fees in The Woodlands. These increases were partially
offset by tenant vacancies at various properties in The Woodlands
and Downtown Columbia, as well as initial operating losses at 1700
Pavilion in Summerlin. In 2023, the Company executed 581,000 square
feet of new or expanded office leases including 357,000 square feet
in The Woodlands, 113,000 square feet in Summerlin, and 111,000
square feet in Downtown Columbia.
- During the year, HHH divested two land parcels and a building
in Ward Village, as well as its two self-storage facilities and the
Memorial Hermann Medical Office Building in The Woodlands,
resulting in a combined gain on sale of $24.0 million. When
combined with three retail centers sold during 2022, NOI from
dispositions declined $3.7 million year-over-year.
Fourth Quarter
- Total Operating Assets NOI—including contribution from
unconsolidated ventures—totaled $54.3 million in the quarter,
representing a 1% year-over-year decrease. Excluding dispositions,
NOI was up $0.1 million.
- Multi-family NOI of $13.3 million increased 23% compared to the
prior-year period primarily due to strong lease-up at HHH’s newest
properties—Marlow in Downtown Columbia and Starling at
Bridgeland—partially offset by initial operating losses at Tanager
Echo in Summerlin.
- Retail NOI of $11.6 million declined 11% year-over-year due to
lower sales revenue and two tenant bankruptcies in Summerlin, as
well as increased reserves in Ward Village. At quarter end, the
retail portfolio was 96% leased.
- Office NOI of $27.4 million declined 2% year-over-year. As of
December 31st, the stabilized office portfolio was 88% leased, and
150,000 square feet of new or expanded leases were executed during
the quarter.
- In December, the Company sold the Memorial Hermann Medical
Office Building for $9.6 million, resulting in a gain on sale
of $3.2 million.
Strategic Developments
Full Year
- Closed on 47 condo units during the year—including 31 at
‘A‘ali‘i and 16 at Kō'ula—generating $47.7 million in revenue. Both
towers are now 100% sold.
- Contracted to sell 78 units at three towers in pre-sales—Ulana,
The Park Ward Village, and Kalae—representing incremental future
revenue of $160.0 million. At year end, Ulana was 100%
pre-sold, and The Park Ward Village and Kalae were 94% and 87%
pre-sold, respectively.
- Announced development of The Launiu—Ward Village’s 11th condo
building which will include 485 residences. This project commenced
pre-sales subsequent to year-end in February.
- In the second quarter, HHH incurred a $16.1 million charge
to fund additional remediation expenditures related to window
construction defects at Waiea. The Company continues to vigorously
pursue recovery of these costs from the general contractor and
other responsible parties.
- In 2023, HHH commenced construction on Ulana—a 696-unit condo
project in Ward Village, 1 Riva Row—a 268-unit high rise luxury
multi-family project in The Woodlands, and the Summerlin Grocery
Anchored Center—a 67,000 square-foot retail center in Downtown
Summerlin.
Fourth Quarter
- Closed on the final condo unit at Kō'ula—generating
$0.8 million in net revenue.
- Contracted to sell 9 units at The Park Ward Village and Kalae.
At quarter end, The Park Ward Village and Kalae were 94% and 87%
pre-sold, respectively.
- In October, Wingspan—a 263-home single-family for rent
development in Bridgeland—welcomed its first residents. At quarter
end, Wingspan was 15% leased with 72% of its units still under
construction.
Seaport
Full Year
- HHH recorded a $548.5 million after-tax impairment charge
related to the Seaport due to reductions in estimated future cash
flows resulting from significant uncertainty of future performance
as stabilization and profitability are taking longer than expected,
pressure on the current cost structure, lower demand for office
space, as well as an increase in the capitalization rate and a
decrease in restaurant multiples used to evaluate future cash
flows.
- Seaport revenue of $82.0 million declined 7% compared to 2022,
driven by the absence of certain restaurant concepts and poor
weather conditions during 2023, as well as non-recurring
COVID-related recoveries at the Fulton Market Building in 2022.
These reductions were partially offset by increased rental revenue
from the Tin Building.
- The 2023 summer concert series was the most successful to date
and included 63 shows which sold over 204,000 tickets, representing
over 93% of available ticket inventory. Pier 17 was recently rated
the #5 Top Club Worldwide by Pollstar and was also nominated for
their Outdoor Concert Venue of the Year.
Fourth Quarter
- Seaport revenue of $17.8 million declined $0.6 million, or 3%
compared to the fourth quarter of 2022, primarily due to poor
weather conditions and reduced restaurant revenue.
- Seaport generated negative NOI of $6.6 million,
representing a $1.7 million year-over-year reduction.
Including $11.6 million of losses from unconsolidated
ventures—primarily related to the Tin Building by
Jean-Georges—total Seaport NOI was a loss of
$18.2 million.
- At the Tin Building by Jean-Georges, equity losses were
$11.9 million, or a $3.7 million year-over-year
improvement primarily due to significantly increased sales revenues
associated with 7-day per week operations and improved
efficiencies, as well as the launch of the new e-commerce platform
in November.
- At the Fulton Market Building, The Lawn Club—a new
20,000-square-foot indoor and outdoor restaurant which includes an
extensive area of indoor grass, a stylish clubhouse bar, and a
variety of lawn games—opened to the public. Additionally, the
Alexander Wang office lease, which includes 41,000 square feet on
the top floor of the building, commenced in mid-December. At year
end, The Fulton Market Building was 100% occupied.
- From late November to early January, the Rooftop at Pier 17®
was transformed into The Santa Clauses’ Winter Wonderland—an
immersive holiday activation with a skating rink, themed dining
cabins, and other family experiences—which welcomed more than
50,000 paying guests to the Rooftop.
Financing Activity
Fourth Quarter
- Closed on a three-year extension of the 4 Waterway and 9303 New
Trails office buildings loan in The Woodlands. The refinancing
required a principal pay down of $8 million and has a new
principal balance of $29.0 million bearing interest at a fixed
rate of 8.08%.
- Closed on a two-year extension of the Creekside Park West
retail center construction loan in The Woodlands. The extended loan
has a total commitment of $17 million, bears interest at SOFR
plus 3.00%, and has an initial maturity in 2026.
- Closed on an $18 million construction loan for the
Summerlin Grocery Anchored Center in Las Vegas. The loan bears
interest at SOFR plus 2.75% and has an initial maturity in
2028.
- Closed on a $16.9 million construction loan for Village
Green at Bridgeland Central in Houston. The loan will initially
bear interest at SOFR plus 3.5% and has an initial maturity in
2026.
- Amended the Ward Village retail loan which primarily provided
for a $25 million principle pay down which was completed
during the fourth quarter.
- Proceeds from the $9.6 million sale of the Memorial
Hermann Medical Office Building in The Woodlands during the quarter
were used to pay down an $8.3 million combined construction
loan for this building and Creekside Park Medical Plaza. Subsequent
to quarter end, the Creekside Park Medical Plaza was also sold for
$14.0 million.
Full Year 2024 Guidance
- MPC EBT is projected to remain
robust during 2024, aided by modest anticipated reductions in
mortgage rates and tight supply of existing homes on the market.
New home sales in Summerlin, Bridgeland, and The Woodlands Hills®
are expected to be strong, leading to continued homebuilder demand
for residential land. The first land sales in Floreo—the first
village in TeravalisTM—are also expected to contribute incremental
EBT in 2024. These year-over-year gains are expected to be more
than offset by reduced EBT associated with exceptional commercial
land sales and builder price participation during 2023, as well as
reduced inventory of custom lots available to sell at Aria Isle in
The Woodlands and the Summit in Summerlin. As a result, 2024 MPC
EBT is expected to modestly decline 10% to 15% year-over-year with
a mid-point of approximately $300 million.
- Operating Assets NOI is projected
to benefit from increased occupancy at new multi-family
developments in Downtown Columbia, Summerlin, and Bridgeland, as
well as improved retail leasing and new tenants in Downtown
Columbia, Ward Village, and The Woodlands. The office portfolio is
expected to benefit from strong leasing momentum experienced since
mid-2022, but free rent periods on many of the new leases and the
impact of some tenant vacancies and new office developments
expected to be completed in 2024 will likely result in office NOI
being relatively flat year-over-year. Overall, 2024 Operating
Assets NOI is expected to be in a range of up 1% to 4%
year-over-year with a mid-point of approximately $250 million.
This includes approximately $5.0 million of projected NOI from The
Las Vegas Aviators and the Las Vegas Ballpark, which are expected
to be included in the spin-off of Seaport Entertainment.
- Condo sales revenues are projected
to range between $675 million and $725 million, with
gross margins between 28% to 30%. Projected condo sales revenues
will be driven by the closing of units at Victoria Place—a 349-unit
upscale development in Ward Village which is 100% pre-sold and
expected to be completed late in the fourth quarter of 2024. This
guidance contemplates approximately $75 million of condo sales
revenues for Victoria Place occurring in the first quarter of 2025
due to the timing of condo closings.
- Cash G&A is projected to range
between $80 million and $90 million, excluding
approximately $20 million of cash expenses associated with the
spin-off of Seaport Entertainment and $5 million of
anticipated non-cash stock compensation.
Conference Call & Webcast
Information
Howard Hughes Holdings Inc. will host its fourth
quarter 2023 earnings conference call on
Wednesday, February 28,
2024, at 10:00 a.m. Eastern Time (9:00
a.m. Central Time). Please visit the Howard Hughes website to
listen to the earnings call via a live webcast. For listeners who
wish to participate in the question-and-answer session via
telephone, please preregister using HHH’s earnings call
registration website. All registrants will receive dial-in
information and a PIN allowing them to access the live call. An
on-demand replay of the earnings call will be available on the
Company’s website.
We are primarily focused on creating shareholder
value by increasing our per-share net asset value. Often, the
nature of our business results in short-term volatility in our net
income due to the timing of MPC land sales, recognition of
condominium revenue and operating business pre-opening expenses,
and, as such, we believe the following metrics summarized below are
most useful in tracking our progress towards net asset value
creation.
|
Three Months Ended December 31, |
|
Year Ended December 31, |
$ in thousands |
|
2023 |
|
|
|
2022 |
|
|
$ Change |
% Change |
|
|
2023 |
|
|
|
2022 |
|
|
$ Change |
% Change |
Operating Assets NOI(1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Office |
$ |
27,439 |
|
|
$ |
27,864 |
|
|
$ |
(425 |
) |
(2 |
)% |
|
$ |
117,840 |
|
|
$ |
111,210 |
|
|
$ |
6,630 |
|
6 |
% |
Retail |
|
11,562 |
|
|
|
13,042 |
|
|
|
(1,480 |
) |
(11 |
)% |
|
|
51,548 |
|
|
|
51,245 |
|
|
|
303 |
|
1 |
% |
Multi-family |
|
13,319 |
|
|
|
10,854 |
|
|
|
2,465 |
|
23 |
% |
|
|
52,831 |
|
|
|
45,564 |
|
|
|
7,267 |
|
16 |
% |
Other |
|
181 |
|
|
|
(51 |
) |
|
|
232 |
|
NM |
|
|
10,489 |
|
|
|
12,711 |
|
|
|
(2,222 |
) |
(17 |
)% |
Redevelopments (a) |
|
(107 |
) |
|
|
36 |
|
|
|
(143 |
) |
NM |
|
|
(189 |
) |
|
|
280 |
|
|
|
(469 |
) |
(168 |
)% |
Dispositions (a) |
|
103 |
|
|
|
907 |
|
|
|
(804 |
) |
(89 |
)% |
|
|
1,121 |
|
|
|
4,774 |
|
|
|
(3,653 |
) |
(77 |
)% |
Operating Assets NOI |
|
52,497 |
|
|
|
52,652 |
|
|
|
(155 |
) |
— |
% |
|
|
233,640 |
|
|
|
225,784 |
|
|
|
7,856 |
|
3 |
% |
Company's share of NOI from unconsolidated ventures |
|
1,837 |
|
|
|
2,420 |
|
|
|
(583 |
) |
(24 |
)% |
|
|
10,778 |
|
|
|
13,699 |
|
|
|
(2,921 |
) |
(21 |
)% |
Total Operating Assets NOI |
$ |
54,334 |
|
|
$ |
55,072 |
|
|
$ |
(738 |
) |
(1 |
)% |
|
$ |
244,418 |
|
|
$ |
239,483 |
|
|
$ |
4,935 |
|
2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Projected stabilized NOI Operating Assets ($ in millions) |
$ |
358.9 |
|
|
$ |
362.5 |
|
|
$ |
(3.6 |
) |
(1 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MPC |
|
|
|
|
|
|
|
|
|
|
|
|
|
Acres Sold - Residential |
|
207 |
|
|
|
108 |
|
|
|
99 |
|
92 |
% |
|
|
375 |
|
|
|
323 |
|
|
|
52 |
|
16 |
% |
Acres Sold - Commercial |
|
9 |
|
|
|
84 |
|
|
|
(75 |
) |
(89 |
)% |
|
|
132 |
|
|
|
135 |
|
|
|
(3 |
) |
(3 |
)% |
Price Per Acre - Residential |
$ |
1,047 |
|
|
$ |
856 |
|
|
$ |
191 |
|
22 |
% |
|
$ |
944 |
|
|
$ |
768 |
|
|
$ |
176 |
|
23 |
% |
Price Per Acre - Commercial |
$ |
480 |
|
|
$ |
453 |
|
|
$ |
27 |
|
6 |
% |
|
$ |
273 |
|
|
$ |
557 |
|
|
$ |
(284 |
) |
(51 |
)% |
MPC EBT |
$ |
139,323 |
|
|
$ |
76,660 |
|
|
$ |
62,663 |
|
82 |
% |
|
$ |
341,419 |
|
|
$ |
282,987 |
|
|
$ |
58,432 |
|
21 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Seaport NOI(1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Landlord Operations |
$ |
(6,214 |
) |
|
$ |
(5,442 |
) |
|
$ |
(772 |
) |
(14 |
)% |
|
$ |
(21,506 |
) |
|
$ |
(15,702 |
) |
|
$ |
(5,804 |
) |
(37 |
)% |
Landlord Operations - Multi-family |
|
57 |
|
|
|
14 |
|
|
|
43 |
|
NM |
|
|
133 |
|
|
|
110 |
|
|
|
23 |
|
21 |
% |
Managed Businesses |
|
(1,574 |
) |
|
|
(234 |
) |
|
|
(1,340 |
) |
NM |
|
|
(3,516 |
) |
|
|
(85 |
) |
|
|
(3,431 |
) |
NM |
Tin Building |
|
2,425 |
|
|
|
2,403 |
|
|
|
22 |
|
1 |
% |
|
|
9,486 |
|
|
|
4,015 |
|
|
|
5,471 |
|
136 |
% |
Events and Sponsorships |
|
(1,278 |
) |
|
|
(1,651 |
) |
|
|
373 |
|
23 |
% |
|
|
(114 |
) |
|
|
1,894 |
|
|
|
(2,008 |
) |
(106 |
)% |
Seaport NOI |
|
(6,584 |
) |
|
|
(4,910 |
) |
|
|
(1,674 |
) |
(34 |
)% |
|
|
(15,517 |
) |
|
|
(9,768 |
) |
|
|
(5,749 |
) |
(59 |
)% |
Company's share of NOI from unconsolidated ventures |
|
(11,617 |
) |
|
|
(15,730 |
) |
|
|
4,113 |
|
26 |
% |
|
|
(39,073 |
) |
|
|
(35,581 |
) |
|
|
(3,492 |
) |
(10 |
)% |
Total Seaport NOI |
$ |
(18,201 |
) |
|
$ |
(20,640 |
) |
|
$ |
2,439 |
|
12 |
% |
|
$ |
(54,590 |
) |
|
$ |
(45,349 |
) |
|
$ |
(9,241 |
) |
(20 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Strategic Developments |
|
|
|
|
|
|
|
|
|
|
|
|
|
Condominium rights and unit sales |
$ |
792 |
|
|
$ |
217,397 |
|
|
$ |
(216,605 |
) |
(100 |
)% |
|
$ |
47,707 |
|
|
$ |
677,078 |
|
|
$ |
(629,371 |
) |
(93 |
)% |
(a) |
Properties that were transferred
to our Strategic Developments segment for redevelopment and
properties that were sold are shown separately for all periods
presented. |
|
NM - Not
Meaningful |
|
Financial Data |
(1) |
See the accompanying appendix for a reconciliation of GAAP to
non-GAAP financial measures and a statement indicating why
management believes the non-GAAP financial measure provides useful
information for investors. |
About Howard Hughes Holdings
Inc.®
Howard Hughes Holdings Inc. owns, manages, and
develops commercial, residential, and mixed-use real estate
throughout the U.S. Its award-winning assets include the country's
preeminent portfolio of master planned communities, as well as
operating properties and development opportunities including: the
Seaport in New York City; Downtown Columbia® in Maryland; The
Woodlands®, Bridgeland® and The Woodlands Hills® in the Greater
Houston, Texas area; Summerlin® in Las Vegas; Ward Village® in
Honolulu, Hawaiʻi; and Teravalis™ in the Greater Phoenix, Arizona
area. The Howard Hughes portfolio is strategically positioned to
meet and accelerate development based on market demand, resulting
in one of the strongest real estate platforms in the country.
Dedicated to innovative placemaking, the company is recognized for
its ongoing commitment to design excellence and to the cultural
life of its communities. Howard Hughes Holdings Inc. is traded on
the New York Stock Exchange as HHH. For additional information
visit www.howardhughes.com.
Safe Harbor Statement
Certain statements contained in this press
release may constitute “forward-looking statements” within the
meaning of Section 27A of the Securities Act and Section 21E of the
Exchange Act. All statements other than statements of historical
facts, including, among others, statements regarding the Company’s
future financial position, results or performance, are
forward-looking statements. Those statements include statements
regarding the intent, belief, or current expectations of the
Company, members of its management team, as well as the assumptions
on which such statements are based, and generally are identified by
the use of words such as “anticipate,” “believe,” “estimate,”
“expect,” “forecast,” “intend,” “likely,” “may,” “plan,” “project,”
“realize,” “should,” “transform,” “will,” “would,” and other
statements of similar expression. Forward-looking statements are
not a guaranty of future performance and involve risks and
uncertainties that actual results may differ materially from those
contemplated by such forward-looking statements. Many of these
factors are beyond the Company’s abilities to control or predict.
Some of the risks, uncertainties and other important factors that
may affect future results or cause actual results to differ
materially from those expressed or implied by forward-looking
statements include: (i) general adverse economic and local real
estate conditions; (ii) potential changes in the financial markets
and interest rates; (iii) the inability of major tenants to
continue paying their rent obligations due to bankruptcy,
insolvency or a general downturn in their business; (iv) financing
risks, such as the inability to obtain equity, debt or other
sources of financing or refinancing on favorable terms, if at all;
(v) ability to compete effectively, including the potential impact
of heightened competition for tenants and potential decreases in
occupancy at our properties; (vi) ability to successfully dispose
of non-core assets on favorable terms, if at all; (vii) ability to
successfully identify, acquire, develop and/or manage properties on
favorable terms and in accordance with applicable zoning and
permitting laws; (xiii) changes in governmental laws and
regulations; (ix) increases in operating costs, including
construction cost increases as the result of trade disputes and
tariffs on goods imported in the United States; (x) the impact of
the COVID-19 pandemic on the Company’s business, tenants and the
economy in general, and our ability to accurately assess and
predict such impacts; (xi) lack of control over certain of the
Company’s properties due to the joint ownership of such property;
(xii) impairment charges; (xiii) the effects of geopolitical
instability and risks such as terrorist attacks and trade wars;
(xiv) the effects of natural disasters, including floods, droughts,
wind, tornadoes and hurricanes; (xv) the inherent risks related to
disruption of information technology networks and related systems,
including cyber security attacks; and (xvi) the ability to attract
and retain key employees. The Company refers you to the section
entitled “Risk Factors” contained in the Company's Annual Report on
Form 10-K for the year ended December 31, 2023. Additional
information concerning factors that could cause actual results to
differ materially from those forward-looking statements is
contained from time to time in the Company's filings with the
Securities and Exchange Commission. Copies of each filing may be
obtained from the Company or the Securities and Exchange
Commission. The risks included here are not exhaustive and undue
reliance should not be placed on any forward-looking statements,
which are based on current expectations. All written and oral
forward-looking statements attributable to the Company, its
management, or persons acting on their behalf are qualified in
their entirety by these cautionary statements. Further,
forward-looking statements speak only as of the date they are made,
and the Company undertakes no obligation to update or revise
forward-looking statements to reflect changed assumptions, the
occurrence of unanticipated events or changes to future operating
results over time unless otherwise required by law.
Financial Presentation
As discussed throughout this release, we use
certain non-GAAP performance measures, in addition to the required
GAAP presentations, as we believe these measures improve the
understanding of our operational results and make comparisons of
operating results among peer companies more meaningful. We
continually evaluate the usefulness, relevance, limitations and
calculation of our reported non-GAAP performance measures to
determine how best to provide relevant information to the public,
and thus such reported measures could change. A non-GAAP financial
measure used throughout this release is net operating income (NOI).
We provide a more detailed discussion about this non-GAAP measure
in our reconciliation of non-GAAP measures provided in the appendix
in this earnings release.
Media Contact Howard Hughes
Holdings Inc. Cristina Carlson, 646-822-6910 Senior Vice President,
Head of Corporate Communications
cristina.carlson@howardhughes.com
Investor Relations Contact
Howard Hughes Holdings Inc. Eric Holcomb, 281-475-2144 Senior Vice
President, Investor Relations eric.holcomb@howardhughes.com
HOWARD
HUGHES HOLDINGS INC. CONSOLIDATED STATEMENTS OF
OPERATIONS |
|
|
Three Months Ended December 31, |
|
Year Ended December 31, |
thousands except per share amounts |
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
REVENUES |
|
|
|
|
|
|
|
Condominium rights and unit sales |
$ |
792 |
|
|
$ |
217,397 |
|
|
$ |
47,707 |
|
|
$ |
677,078 |
|
Master Planned Communities land sales |
|
193,140 |
|
|
|
117,033 |
|
|
|
370,185 |
|
|
|
316,065 |
|
Rental revenue |
|
98,968 |
|
|
|
103,022 |
|
|
|
405,363 |
|
|
|
399,103 |
|
Other land, rental, and property revenues |
|
27,712 |
|
|
|
24,611 |
|
|
|
139,858 |
|
|
|
144,481 |
|
Builder price participation |
|
15,226 |
|
|
|
19,942 |
|
|
|
60,989 |
|
|
|
71,761 |
|
Total revenues |
|
335,838 |
|
|
|
482,005 |
|
|
|
1,024,102 |
|
|
|
1,608,488 |
|
|
|
|
|
|
|
|
|
EXPENSES |
|
|
|
|
|
|
|
Condominium rights and unit cost of sales |
|
(973 |
) |
|
|
154,957 |
|
|
|
55,417 |
|
|
|
483,983 |
|
Master Planned Communities cost of sales |
|
73,916 |
|
|
|
44,162 |
|
|
|
140,050 |
|
|
|
119,466 |
|
Operating costs |
|
88,392 |
|
|
|
80,626 |
|
|
|
337,018 |
|
|
|
317,389 |
|
Rental property real estate taxes |
|
11,391 |
|
|
|
13,719 |
|
|
|
57,650 |
|
|
|
54,033 |
|
Provision for (recovery of) doubtful accounts |
|
(1,561 |
) |
|
|
(279 |
) |
|
|
(2,561 |
) |
|
|
1,959 |
|
General and administrative |
|
25,822 |
|
|
|
20,898 |
|
|
|
91,193 |
|
|
|
81,772 |
|
Depreciation and amortization |
|
54,914 |
|
|
|
52,777 |
|
|
|
216,118 |
|
|
|
200,361 |
|
Other |
|
4,498 |
|
|
|
3,992 |
|
|
|
13,383 |
|
|
|
11,977 |
|
Total expenses |
|
256,399 |
|
|
|
370,852 |
|
|
|
908,268 |
|
|
|
1,270,940 |
|
|
|
|
|
|
|
|
|
OTHER |
|
|
|
|
|
|
|
Provision for impairment |
|
— |
|
|
|
— |
|
|
|
(672,492 |
) |
|
|
— |
|
Gain (loss) on sale or disposal of real estate and other assets,
net |
|
3,162 |
|
|
|
25,669 |
|
|
|
24,162 |
|
|
|
29,678 |
|
Other income (loss), net |
|
737 |
|
|
|
(588 |
) |
|
|
4,284 |
|
|
|
1,909 |
|
Total other |
|
3,899 |
|
|
|
25,081 |
|
|
|
(644,046 |
) |
|
|
31,587 |
|
|
|
|
|
|
|
|
|
Operating
income (loss) |
|
83,338 |
|
|
|
136,234 |
|
|
|
(528,212 |
) |
|
|
369,135 |
|
|
|
|
|
|
|
|
|
Interest
income |
|
8,937 |
|
|
|
2,545 |
|
|
|
25,750 |
|
|
|
3,818 |
|
Interest
expense |
|
(46,315 |
) |
|
|
(30,928 |
) |
|
|
(156,951 |
) |
|
|
(110,891 |
) |
Gain (loss)
on extinguishment of debt |
|
(96 |
) |
|
|
(1,732 |
) |
|
|
(144 |
) |
|
|
(2,377 |
) |
Equity in earnings (losses) from unconsolidated ventures |
|
(13,834 |
) |
|
|
(34,077 |
) |
|
|
(55,708 |
) |
|
|
(14,549 |
) |
Income (loss) before income taxes |
|
32,030 |
|
|
|
72,042 |
|
|
|
(715,265 |
) |
|
|
245,136 |
|
Income tax expense (benefit) |
|
(2,343 |
) |
|
|
18,678 |
|
|
|
(163,735 |
) |
|
|
60,500 |
|
Net income (loss) |
|
34,373 |
|
|
|
53,364 |
|
|
|
(551,530 |
) |
|
|
184,636 |
|
Net (income) loss attributable to noncontrolling interests |
|
(77 |
) |
|
|
(613 |
) |
|
|
(243 |
) |
|
|
(103 |
) |
Net income (loss) attributable to common stockholders |
$ |
34,296 |
|
|
$ |
52,751 |
|
|
$ |
(551,773 |
) |
|
$ |
184,533 |
|
|
|
|
|
|
|
|
|
Basic income (loss) per share |
$ |
0.69 |
|
|
$ |
1.07 |
|
|
$ |
(11.13 |
) |
|
$ |
3.65 |
|
Diluted income (loss) per share |
$ |
0.69 |
|
|
$ |
1.07 |
|
|
$ |
(11.13 |
) |
|
$ |
3.65 |
|
HOWARD
HUGHES HOLDINGS INC. CONSOLIDATED BALANCE SHEETS |
|
thousands except par values and share amounts |
December 31, 2023 |
|
December 31, 2022 |
ASSETS |
|
|
|
Master Planned Communities assets |
$ |
2,445,673 |
|
|
$ |
2,411,526 |
|
Buildings and equipment |
|
4,177,677 |
|
|
|
4,246,389 |
|
Less: accumulated depreciation |
|
(1,032,226 |
) |
|
|
(867,700 |
) |
Land |
|
303,685 |
|
|
|
312,230 |
|
Developments |
|
1,272,445 |
|
|
|
1,125,027 |
|
Net investment in real estate |
|
7,167,254 |
|
|
|
7,227,472 |
|
Investments
in unconsolidated ventures |
|
220,258 |
|
|
|
246,171 |
|
Cash and
cash equivalents |
|
631,548 |
|
|
|
626,653 |
|
Restricted cash |
|
421,509 |
|
|
|
472,284 |
|
Accounts
receivable, net |
|
115,045 |
|
|
|
103,437 |
|
Municipal
Utility District receivables, net |
|
550,884 |
|
|
|
473,068 |
|
Deferred
expenses, net |
|
142,561 |
|
|
|
128,865 |
|
Operating
lease right-of-use assets |
|
44,897 |
|
|
|
46,926 |
|
Other assets, net |
|
283,047 |
|
|
|
278,587 |
|
Total assets |
$ |
9,577,003 |
|
|
$ |
9,603,463 |
|
|
|
|
|
LIABILITIES |
|
|
|
Mortgages, notes, and loans payable, net |
$ |
5,302,620 |
|
|
$ |
4,747,183 |
|
Operating
lease obligations |
|
51,584 |
|
|
|
51,321 |
|
Deferred
tax liabilities, net |
|
87,835 |
|
|
|
254,336 |
|
Accounts payable and other liabilities |
|
1,076,040 |
|
|
|
944,511 |
|
Total liabilities |
|
6,518,079 |
|
|
|
5,997,351 |
|
|
|
|
|
EQUITY |
|
|
|
Preferred
stock: $0.01 par value; 50,000,000 shares authorized, none
issued |
|
— |
|
|
|
— |
|
Common
stock: $0.01 par value; 150,000,000 shares authorized, 56,495,791
issued, and 50,038,014 outstanding as of December 31, 2023,
56,226,273 shares issued, and 49,801,997 outstanding as of December
31, 2022 |
|
565 |
|
|
|
564 |
|
Additional paid-in capital |
|
3,988,496 |
|
|
|
3,972,561 |
|
Retained
earnings (accumulated deficit) |
|
(383,696 |
) |
|
|
168,077 |
|
Accumulated other comprehensive income (loss) |
|
1,272 |
|
|
|
10,335 |
|
Treasury stock, at cost, 6,457,777 shares as of December 31,
2023, and 6,424,276 shares as of December 31, 2022 |
|
(613,766 |
) |
|
|
(611,038 |
) |
Total stockholders' equity |
|
2,992,871 |
|
|
|
3,540,499 |
|
Noncontrolling interests |
|
66,053 |
|
|
|
65,613 |
|
Total equity |
|
3,058,924 |
|
|
|
3,606,112 |
|
Total liabilities and equity |
$ |
9,577,003 |
|
|
$ |
9,603,463 |
|
Segment Earnings Before Tax
(EBT)
As a result of our four segments—Operating
Assets, Master Planned Communities (MPC), Seaport, and Strategic
Developments—being managed separately, we use different operating
measures to assess operating results and allocate resources among
these four segments. The one common operating measure used to
assess operating results for our business segments is EBT. EBT, as
it relates to each business segment, includes the revenues and
expenses of each segment, as shown below. EBT excludes corporate
expenses and other items that are not allocable to the segments. We
present EBT because we use this measure, among others, internally
to assess the core operating performance of our assets.
|
Three Months Ended December
31, |
|
Year Ended December 31, |
thousands |
2023 |
|
|
2022 |
|
|
$ Change |
|
|
2023 |
|
|
2022 |
|
|
$ Change |
|
Operating Assets Segment EBT |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenues |
$ |
104,406 |
|
|
$ |
104,092 |
|
|
$ |
314 |
|
|
$ |
443,632 |
|
|
$ |
431,834 |
|
|
$ |
11,798 |
|
Total operating expenses |
(52,329 |
) |
|
(47,538 |
) |
|
(4,791 |
) |
|
(210,166 |
) |
|
(194,496 |
) |
|
(15,670 |
) |
Segment operating income (loss) |
52,077 |
|
|
56,554 |
|
|
(4,477 |
) |
|
233,466 |
|
|
237,338 |
|
|
(3,872 |
) |
Depreciation
and amortization |
(47,094 |
) |
|
(39,483 |
) |
|
(7,611 |
) |
|
(170,731 |
) |
|
(154,626 |
) |
|
(16,105 |
) |
Interest
income (expense), net |
(36,308 |
) |
|
(25,183 |
) |
|
(11,125 |
) |
|
(127,388 |
) |
|
(89,959 |
) |
|
(37,429 |
) |
Other income
(loss), net |
(155 |
) |
|
(1,083 |
) |
|
928 |
|
|
1,843 |
|
|
(1,140 |
) |
|
2,983 |
|
Equity in
earnings (losses) from unconsolidated ventures |
(2,342 |
) |
|
365 |
|
|
(2,707 |
) |
|
2,969 |
|
|
22,263 |
|
|
(19,294 |
) |
Gain (loss)
on sale or disposal of real estate and other assets, net |
3,162 |
|
|
25,570 |
|
|
(22,408 |
) |
|
23,926 |
|
|
29,588 |
|
|
(5,662 |
) |
Gain (loss)
on extinguishment of debt |
(96 |
) |
|
(1,585 |
) |
|
1,489 |
|
|
(96 |
) |
|
(2,230 |
) |
|
2,134 |
|
Operating Assets segment EBT |
$ |
(30,756 |
) |
|
$ |
15,155 |
|
|
$ |
(45,911 |
) |
|
$ |
(36,011 |
) |
|
$ |
41,234 |
|
|
$ |
(77,245 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Master Planned Communities Segment EBT |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenues |
$ |
212,329 |
|
|
$ |
141,375 |
|
|
$ |
70,954 |
|
|
$ |
448,452 |
|
|
$ |
408,365 |
|
|
$ |
40,087 |
|
Total operating expenses |
(89,802 |
) |
|
(60,818 |
) |
|
(28,984 |
) |
|
(193,470 |
) |
|
(173,905 |
) |
|
(19,565 |
) |
Segment operating income (loss) |
122,527 |
|
|
80,557 |
|
|
41,970 |
|
|
254,982 |
|
|
234,460 |
|
|
20,522 |
|
Depreciation
and amortization |
(102 |
) |
|
(108 |
) |
|
6 |
|
|
(418 |
) |
|
(394 |
) |
|
(24 |
) |
Interest
income (expense), net |
15,287 |
|
|
14,608 |
|
|
679 |
|
|
64,291 |
|
|
50,305 |
|
|
13,986 |
|
Other income
(loss), net |
1 |
|
|
— |
|
|
1 |
|
|
(102 |
) |
|
23 |
|
|
(125 |
) |
Equity in
earnings (losses) from unconsolidated ventures |
1,610 |
|
|
(18,397 |
) |
|
20,007 |
|
|
22,666 |
|
|
(1,407 |
) |
|
24,073 |
|
MPC segment EBT |
$ |
139,323 |
|
|
$ |
76,660 |
|
|
$ |
62,663 |
|
|
$ |
341,419 |
|
|
$ |
282,987 |
|
|
$ |
58,432 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Seaport Segment EBT |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenues |
$ |
17,780 |
|
|
$ |
18,415 |
|
|
$ |
(635 |
) |
|
$ |
81,971 |
|
|
$ |
88,468 |
|
|
$ |
(6,497 |
) |
Total operating expenses |
(24,582 |
) |
|
(25,064 |
) |
|
482 |
|
|
(103,466 |
) |
|
(104,393 |
) |
|
927 |
|
Segment operating income (loss) |
(6,802 |
) |
|
(6,649 |
) |
|
(153 |
) |
|
(21,495 |
) |
|
(15,925 |
) |
|
(5,570 |
) |
Depreciation
and amortization |
(5,987 |
) |
|
(11,144 |
) |
|
5,157 |
|
|
(37,791 |
) |
|
(36,338 |
) |
|
(1,453 |
) |
Interest
income (expense), net |
(790 |
) |
|
899 |
|
|
(1,689 |
) |
|
3,065 |
|
|
3,902 |
|
|
(837 |
) |
Other income
(loss), net |
(3 |
) |
|
(44 |
) |
|
41 |
|
|
(1,290 |
) |
|
245 |
|
|
(1,535 |
) |
Equity in
earnings (losses) from unconsolidated ventures |
(13,150 |
) |
|
(16,050 |
) |
|
2,900 |
|
|
(81,485 |
) |
|
(36,273 |
) |
|
(45,212 |
) |
Gain (loss)
on extinguishment of debt |
— |
|
|
— |
|
|
— |
|
|
(48 |
) |
|
— |
|
|
(48 |
) |
Provision for impairment |
— |
|
|
— |
|
|
— |
|
|
(672,492 |
) |
|
— |
|
|
(672,492 |
) |
Seaport segment EBT |
$ |
(26,732 |
) |
|
$ |
(32,988 |
) |
|
$ |
6,256 |
|
|
$ |
(811,536 |
) |
|
$ |
(84,389 |
) |
|
$ |
(727,147 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Strategic Developments Segment EBT |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenues |
$ |
1,308 |
|
|
$ |
218,108 |
|
|
$ |
(216,800 |
) |
|
$ |
49,987 |
|
|
$ |
679,763 |
|
|
$ |
(629,776 |
) |
Total operating expenses |
(4,452 |
) |
|
(159,765 |
) |
|
155,313 |
|
|
(80,472 |
) |
|
(504,036 |
) |
|
423,564 |
|
Segment operating income (loss) |
(3,144 |
) |
|
58,343 |
|
|
(61,487 |
) |
|
(30,485 |
) |
|
175,727 |
|
|
(206,212 |
) |
Depreciation
and amortization |
(1,115 |
) |
|
(1,236 |
) |
|
121 |
|
|
(3,963 |
) |
|
(5,319 |
) |
|
1,356 |
|
Interest
income (expense), net |
4,157 |
|
|
4,739 |
|
|
(582 |
) |
|
16,074 |
|
|
17,073 |
|
|
(999 |
) |
Other income
(loss), net |
532 |
|
|
438 |
|
|
94 |
|
|
690 |
|
|
1,799 |
|
|
(1,109 |
) |
Equity in
earnings (losses) from unconsolidated ventures |
48 |
|
|
5 |
|
|
43 |
|
|
142 |
|
|
868 |
|
|
(726 |
) |
Gain (loss)
on sale or disposal of real estate and other assets, net |
— |
|
|
99 |
|
|
(99 |
) |
|
236 |
|
|
90 |
|
|
146 |
|
Strategic Developments segment EBT |
$ |
478 |
|
|
$ |
62,388 |
|
|
$ |
(61,910 |
) |
|
$ |
(17,306 |
) |
|
$ |
190,238 |
|
|
$ |
(207,544 |
) |
Appendix – Reconciliation of Non-GAAP
Measures
Below are GAAP to non-GAAP reconciliations of
certain financial measures, as required under Regulation G of the
Securities Exchange Act of 1934. Non-GAAP information should be
considered by the reader in addition to, but not instead of, the
financial statements prepared in accordance with GAAP. The non-GAAP
financial information presented may be determined or calculated
differently by other companies and may not be comparable to
similarly titled measures.
Net Operating Income (NOI)
We define NOI as operating revenues (rental
income, tenant recoveries, and other revenue) less operating
expenses (real estate taxes, repairs and maintenance, marketing,
and other property expenses). NOI excludes straight-line rents and
amortization of tenant incentives, net; interest expense, net;
ground rent amortization; demolition costs; other income (loss);
depreciation and amortization; development-related marketing costs;
gain on sale or disposal of real estate and other assets, net; loss
on extinguishment of debt; provision for impairment; and equity in
earnings from unconsolidated ventures. This amount is presented as
Operating Assets NOI and Seaport NOI throughout this document.
Total Operating Assets NOI and Total Seaport NOI represent NOI as
defined above with the addition of our share of NOI from
unconsolidated ventures.
We believe that NOI is a useful supplemental
measure of the performance of our Operating Assets and Seaport
segments because it provides a performance measure that reflects
the revenues and expenses directly associated with owning and
operating real estate properties. We use NOI to evaluate our
operating performance on a property-by-property basis because NOI
allows us to evaluate the impact that property-specific factors
such as rental and occupancy rates, tenant mix, and operating costs
have on our operating results, gross margins, and investment
returns.
A reconciliation of segment EBT to NOI for
Operating Assets and Seaport is presented in the tables below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended December 31, |
|
|
Year Ended December 31, |
|
thousands |
|
2023 |
|
|
2022 |
|
|
Change |
|
|
2023 |
|
|
2022 |
|
|
$ Change |
|
Operating Assets
Segment |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues |
$ |
104,406 |
|
|
$ 104,092 |
|
$ |
314 |
|
$ |
443,632 |
|
$ |
431,834 |
|
$ |
11,798 |
|
Total
operating expenses |
|
(52,329 |
) |
|
(47,538 |
) |
|
(4,791 |
) |
|
(210,166 |
) |
|
(194,496 |
) |
|
(15,670 |
) |
Segment operating income
(loss) |
|
52,077 |
|
|
56,554 |
|
|
(4,477 |
) |
|
233,466 |
|
|
237,338 |
|
|
(3,872 |
) |
Depreciation and
amortization |
|
(47,094 |
) |
|
(39,483 |
) |
|
(7,611 |
) |
|
(170,731 |
) |
|
(154,626 |
) |
|
(16,105 |
) |
Interest income (expense),
net |
|
(36,308 |
) |
|
(25,183 |
) |
|
(11,125 |
) |
|
(127,388 |
) |
|
(89,959 |
) |
|
(37,429 |
) |
Other income (loss), net |
|
(155 |
) |
|
(1,083 |
) |
|
928 |
|
|
1,843 |
|
|
(1,140 |
) |
|
2,983 |
|
Equity in earnings (losses)
from unconsolidated ventures |
|
(2,342 |
) |
|
365 |
|
|
(2,707 |
) |
|
2,969 |
|
|
22,263 |
|
|
(19,294 |
) |
Gain (loss) on sale or
disposal of real estate and other assets, net |
|
3,162 |
|
|
25,570 |
|
|
(22,408 |
) |
|
23,926 |
|
|
29,588 |
|
|
(5,662 |
) |
Gain (loss) on extinguishment
of debt |
|
(96 |
) |
|
(1,585 |
) |
|
1,489 |
|
|
(96 |
) |
|
(2,230 |
) |
|
2,134 |
|
Operating Assets segment EBT |
|
(30,756 |
) |
|
15,155 |
|
|
(45,911 |
) |
|
(36,011 |
) |
|
41,234 |
|
|
(77,245 |
) |
Add back: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
47,094 |
|
|
39,483 |
|
|
7,611 |
|
|
170,731 |
|
|
154,626 |
|
|
16,105 |
|
Interest (income) expense, net |
|
36,308 |
|
|
25,183 |
|
|
11,125 |
|
|
127,388 |
|
|
89,959 |
|
|
37,429 |
|
Equity in (earnings) losses from unconsolidated ventures |
|
2,342 |
|
|
(365 |
) |
|
2,707 |
|
|
(2,969 |
) |
|
(22,263 |
) |
|
19,294 |
|
(Gain) loss on sale or disposal of real estate and other assets,
net |
|
(3,162 |
) |
|
(25,570 |
) |
|
22,408 |
|
|
(23,926 |
) |
|
(29,588 |
) |
|
5,662 |
|
(Gain) loss on extinguishment of debt |
|
96 |
|
|
1,585 |
|
|
(1,489 |
) |
|
96 |
|
|
2,230 |
|
|
(2,134 |
) |
Impact of straight-line rent |
|
408 |
|
|
(3,958 |
) |
|
4,366 |
|
|
(2,256 |
) |
|
(11,241 |
) |
|
8,985 |
|
Other |
|
167 |
|
|
1,139 |
|
|
(972 |
) |
|
587 |
|
|
827 |
|
|
(240 |
) |
Operating Assets NOI |
|
52,497 |
|
|
52,652 |
|
|
(155 |
) |
|
233,640 |
|
|
225,784 |
|
|
7,856 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company's share of NOI from
equity investments |
|
1,837 |
|
|
2,420 |
|
|
(583 |
) |
|
7,745 |
|
|
9,061 |
|
|
(1,316 |
) |
Distributions from Summerlin Hospital investment |
|
— |
|
|
— |
|
|
— |
|
|
3,033 |
|
|
4,638 |
|
|
(1,605 |
) |
Company's share of NOI from
unconsolidated ventures |
|
1,837 |
|
|
2,420 |
|
|
(583 |
) |
|
10,778 |
|
|
13,699 |
|
|
(2,921 |
) |
Total Operating Assets NOI |
$ |
54,334 |
|
$ |
55,072 |
|
$ |
(738 |
) |
$ |
244,418 |
|
$ |
239,483 |
|
$ |
4,935 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Seaport
Segment |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues |
$ |
17,780 |
|
$ |
18,415 |
|
$ |
(635 |
) |
$ |
81,971 |
|
$ |
88,468 |
|
$ |
(6,497 |
) |
Total
operating expenses |
|
(24,582 |
) |
|
(25,064 |
) |
|
482 |
|
|
(103,466 |
) |
|
(104,393 |
) |
|
927 |
|
Segment operating income
(loss) |
|
(6,802 |
) |
|
(6,649 |
) |
|
(153 |
) |
|
(21,495 |
) |
|
(15,925 |
) |
|
(5,570 |
) |
Depreciation and
amortization |
|
(5,987 |
) |
|
(11,144 |
) |
|
5,157 |
|
|
(37,791 |
) |
|
(36,338 |
) |
|
(1,453 |
) |
Interest income (expense),
net |
|
(790 |
) |
|
899 |
|
|
(1,689 |
) |
|
3,065 |
|
|
3,902 |
|
|
(837 |
) |
Other income (loss), net |
|
(3 |
) |
|
(44 |
) |
|
41 |
|
|
(1,290 |
) |
|
245 |
|
|
(1,535 |
) |
Equity in earnings (losses)
from unconsolidated ventures |
|
(13,150 |
) |
|
(16,050 |
) |
|
2,900 |
|
|
(81,485 |
) |
|
(36,273 |
) |
|
(45,212 |
) |
Gain (loss) on extinguishment
of debt |
|
— |
|
|
— |
|
|
— |
|
|
(48 |
) |
|
— |
|
|
(48 |
) |
Provision for impairment |
|
— |
|
|
— |
|
|
— |
|
|
(672,492 |
) |
|
— |
|
|
(672,492 |
) |
Seaport segment
EBT |
|
(26,732 |
) |
|
(32,988 |
) |
|
6,256 |
|
|
(811,536 |
) |
|
(84,389 |
) |
|
(727,147 |
) |
Add back: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
5,987 |
|
|
11,144 |
|
|
(5,157 |
) |
|
37,791 |
|
|
36,338 |
|
|
1,453 |
|
Interest (income) expense, net |
|
790 |
|
|
(899 |
) |
|
1,689 |
|
|
(3,065 |
) |
|
(3,902 |
) |
|
837 |
|
Equity in (earnings) losses from unconsolidated ventures |
|
13,150 |
|
|
16,050 |
|
|
(2,900 |
) |
|
81,485 |
|
|
36,273 |
|
|
45,212 |
|
(Gain) loss on extinguishment of debt |
|
— |
|
|
— |
|
|
— |
|
|
48 |
|
|
— |
|
|
48 |
|
Impact of straight-line rent |
|
360 |
|
|
(1,063 |
) |
|
1,423 |
|
|
1,927 |
|
|
456 |
|
|
1,471 |
|
Other (income) loss, net (a) |
|
(139 |
) |
|
2,846 |
|
|
(2,985 |
) |
|
5,341 |
|
|
5,456 |
|
|
(115 |
) |
Provision for impairment |
|
— |
|
|
— |
|
|
— |
|
|
672,492 |
|
|
— |
|
|
672,492 |
|
Seaport NOI |
|
(6,584 |
) |
|
(4,910 |
) |
|
(1,674 |
) |
|
(15,517 |
) |
|
(9,768 |
) |
|
(5,749 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company's share of NOI from unconsolidated ventures (b) |
|
(11,617 |
) |
|
(15,730 |
) |
|
4,113 |
|
|
(39,073 |
) |
|
(35,581 |
) |
|
(3,492 |
) |
Total Seaport NOI |
$ |
(18,201 |
) |
$ |
(20,640 |
) |
$ |
2,439 |
|
$ |
(54,590 |
) |
$ |
(45,349 |
) |
$ |
(9,241 |
) |
(a) |
Includes
miscellaneous development-related items. |
(b) |
The Company’s share of NOI related to the Tin Building by
Jean-Georges is calculated using our current partnership funding
provisions. |
Same Store NOI - Operating Assets
Segment
The Company defines Same Store Properties as
consolidated and unconsolidated properties that are acquired or
placed in-service prior to the beginning of the earliest period
presented and owned by the Company through the end of the latest
period presented. Same Store Properties exclude properties placed
in-service, acquired, repositioned or in development or
redevelopment after the beginning of the earliest period presented
or disposed of prior to the end of the latest period presented.
Accordingly, it takes at least one year and one quarter after a
property is acquired or treated as in-service for that property to
be included in Same Store Properties.
We calculate Same Store Net
Operating Income (Same Store NOI) as Operating Assets NOI
applicable to Same Store Properties. Same Store NOI also
includes the Company's share of NOI from unconsolidated ventures
and the annual distribution from a cost basis investment.
Same Store NOI is a non-GAAP financial measure and should not
be viewed as an alternative to net income calculated in accordance
with GAAP as a measurement of our operating performance. We believe
that Same Store NOI is helpful to investors as a
supplemental comparative performance measure of the income
generated from the same group of properties from one period to the
next. Other companies may not define Same Store NOI in
the same manner as we do; therefore, our computation
of Same Store NOI may not be comparable to that of other
companies. Additionally, we do not control investments in
unconsolidated properties and while we consider disclosures of our
share of NOI to be useful, they may not accurately depict the legal
and economic implications of our investment arrangements.
|
Three Months Ended December 31, |
|
Year Ended December 31, |
thousands |
|
2023 |
|
|
|
2022 |
|
|
$ Change |
|
|
2023 |
|
|
|
2022 |
|
|
$ Change |
Same Store Office |
|
|
|
|
|
|
|
|
|
|
|
Houston, TX |
$ |
19,607 |
|
|
$ |
19,249 |
|
|
$ |
358 |
|
|
$ |
83,033 |
|
|
$ |
73,776 |
|
|
$ |
9,257 |
|
Columbia, MD |
|
3,954 |
|
|
|
5,275 |
|
|
|
(1,321 |
) |
|
|
21,835 |
|
|
|
23,570 |
|
|
|
(1,735 |
) |
Las Vegas, NV |
|
3,666 |
|
|
|
3,467 |
|
|
|
199 |
|
|
|
13,776 |
|
|
|
14,027 |
|
|
|
(251 |
) |
Total Same Store Office |
|
27,227 |
|
|
|
27,991 |
|
|
|
(764 |
) |
|
|
118,644 |
|
|
|
111,373 |
|
|
|
7,271 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Same
Store Retail |
|
|
|
|
|
|
|
|
|
|
|
Houston, TX |
|
2,851 |
|
|
|
2,751 |
|
|
|
100 |
|
|
|
11,908 |
|
|
|
9,875 |
|
|
|
2,033 |
|
Columbia, MD |
|
1,020 |
|
|
|
447 |
|
|
|
573 |
|
|
|
3,017 |
|
|
|
2,241 |
|
|
|
776 |
|
Las Vegas, NV |
|
5,445 |
|
|
|
6,548 |
|
|
|
(1,103 |
) |
|
|
23,558 |
|
|
|
23,876 |
|
|
|
(318 |
) |
Honolulu, HI |
|
2,259 |
|
|
|
3,095 |
|
|
|
(836 |
) |
|
|
13,520 |
|
|
|
14,954 |
|
|
|
(1,434 |
) |
Total Same Store Retail |
|
11,575 |
|
|
|
12,841 |
|
|
|
(1,266 |
) |
|
|
52,003 |
|
|
|
50,946 |
|
|
|
1,057 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Same
Store Multi-family |
|
|
|
|
|
|
|
|
|
|
|
Houston, TX |
|
8,542 |
|
|
|
7,660 |
|
|
|
882 |
|
|
|
36,043 |
|
|
|
31,993 |
|
|
|
4,050 |
|
Columbia, MD |
|
1,757 |
|
|
|
1,558 |
|
|
|
199 |
|
|
|
6,784 |
|
|
|
6,492 |
|
|
|
292 |
|
Las Vegas, NV |
|
1,539 |
|
|
|
1,746 |
|
|
|
(207 |
) |
|
|
7,143 |
|
|
|
7,289 |
|
|
|
(146 |
) |
Company's share of NOI from unconsolidated ventures |
|
1,806 |
|
|
|
1,831 |
|
|
|
(25 |
) |
|
|
7,326 |
|
|
|
7,271 |
|
|
|
55 |
|
Total Same Store Multi-family |
|
13,644 |
|
|
|
12,795 |
|
|
|
849 |
|
|
|
57,296 |
|
|
|
53,045 |
|
|
|
4,251 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Same
Store Other |
|
|
|
|
|
|
|
|
|
|
|
Houston, TX |
|
2,037 |
|
|
|
1,848 |
|
|
|
189 |
|
|
|
6,765 |
|
|
|
6,153 |
|
|
|
612 |
|
Columbia, MD |
|
(78 |
) |
|
|
(22 |
) |
|
|
(56 |
) |
|
|
(70 |
) |
|
|
(199 |
) |
|
|
129 |
|
Las Vegas, NV |
|
(1,737 |
) |
|
|
(2,047 |
) |
|
|
310 |
|
|
|
3,640 |
|
|
|
6,246 |
|
|
|
(2,606 |
) |
Honolulu, HI |
|
(29 |
) |
|
|
49 |
|
|
|
(78 |
) |
|
|
154 |
|
|
|
354 |
|
|
|
(200 |
) |
Company's share of NOI from unconsolidated ventures |
|
31 |
|
|
|
589 |
|
|
|
(558 |
) |
|
|
3,452 |
|
|
|
6,428 |
|
|
|
(2,976 |
) |
Total Same Store Other |
|
224 |
|
|
|
417 |
|
|
|
(193 |
) |
|
|
13,941 |
|
|
|
18,982 |
|
|
|
(5,041 |
) |
Total Same Store NOI |
|
52,670 |
|
|
|
54,044 |
|
|
|
(1,374 |
) |
|
|
241,884 |
|
|
|
234,346 |
|
|
|
7,538 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Same Store NOI |
|
1,664 |
|
|
|
1,028 |
|
|
|
636 |
|
|
|
2,534 |
|
|
|
5,137 |
|
|
|
(2,603 |
) |
Total Operating Assets NOI |
$ |
54,334 |
|
|
$ |
55,072 |
|
|
$ |
(738 |
) |
|
$ |
244,418 |
|
|
$ |
239,483 |
|
|
$ |
4,935 |
|
Cash G&A
The Company defines Cash G&A as General and
administrative expense less non-cash stock compensation expense.
Cash G&A is a non-GAAP financial measure that we believe is
useful to our investors and other users of our financial statements
as an indicator of overhead efficiency without regard to non-cash
expenses associated with stock compensation. However, it should not
be used as an alternative to general and administrative expenses in
accordance with GAAP.
|
Three Months Ended December 31, |
|
Year Ended December 31, |
thousands |
|
2023 |
|
|
|
2022 |
|
|
$ Change |
|
|
2023 |
|
|
|
2022 |
|
|
$ Change |
General and Administrative |
|
|
|
|
|
|
|
|
|
|
|
General and administrative (G&A) (a)(b) |
$ |
25,822 |
|
|
$ |
20,898 |
|
|
$ |
4,924 |
|
|
$ |
91,193 |
|
|
$ |
81,772 |
|
|
$ |
9,421 |
|
Less: Non-cash stock compensation |
|
(1,725 |
) |
|
|
(1,366 |
) |
|
|
(359 |
) |
|
|
(8,473 |
) |
|
|
(5,355 |
) |
|
|
(3,118 |
) |
Cash G&A |
$ |
24,097 |
|
|
$ |
19,532 |
|
|
$ |
4,565 |
|
|
$ |
82,720 |
|
|
$ |
76,417 |
|
|
$ |
6,303 |
|
(a) |
G&A expense includes both, $1.6 million of severance and
bonus costs and $2.1 million of non-cash stock compensation
related to our former General Counsel for the first quarter of
2023, and $2.3 million of severance and bonus costs related to
our former Chief Financial Officer for the first quarter of
2022. |
(b) |
G&A expense for the fourth
quarter of 2023 includes legal and consulting fees related to the
planned spinoff of Seaport Entertainment. |
Howard Hughes (NYSE:HHH)
過去 株価チャート
から 5 2024 まで 6 2024
Howard Hughes (NYSE:HHH)
過去 株価チャート
から 6 2023 まで 6 2024