|
|||||
![]() |
|
Strong demand and record pricing for MPC land, along with solid Operating Assets performance, support robust full-year outlook and revised upward guidance
THE WOODLANDS, Texas, Aug. 06, 2025 (GLOBE NEWSWIRE) -- Howard Hughes Holdings Inc. (NYSE: HHH) (the “Company,” “HHH,” “Howard Hughes,” or “we”) today announced operating results for the second quarter ended June 30, 2025. 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.
Second Quarter 2025 Highlights:
“In the second quarter, Pershing Square invested $900 million into Howard Hughes in exchange for nine million newly issued shares of HHH stock,” commented David R. O’Reilly, Chief Executive Officer of Howard Hughes. “This represented a significant milestone for the Company, and we continue to evaluate opportunities to deploy this capital. Over time, we expect HHH will be transformed into a premier diversified holding company, with our portfolio of master planned communities at its foundation.
“As demonstrated this quarter, HHH is firmly positioned to generate substantial positive cash flow now and into the future. Following the successful spinoff of Seaport Entertainment, the Company is fully dedicated to maximizing cash generation for further development of its award-winning MPCs and to fund its diversification strategy. This focus is underpinned by our projected record recurring Adjusted Operating Cash Flow from MPC land sales and Operating Assets, which we anticipate will continue to strengthen. Additionally, a robust pipeline of condo tower completions is expected to deliver significant incremental cash flow over the next five years. In combination with our direct access to Pershing Square’s renowned investment expertise and proven track record, HHH is exceptionally well positioned to drive growth and deliver enhanced value creation for shareholders in the years to come.
“Financially, we delivered strong results and further strengthened our balance sheet through the closing of several key financing transactions. From an operational perspective, we achieved another exceptional quarter, with strong MPC EBT and solid year-over-year Operating Assets NOI growth. We also had a successful quarter in the capital markets, closing on the largest MUD receivable sale in history and generating cash proceeds of $180 million. In addition, we completed two significant financings which reduced 2025 debt maturities by approximately $150 million.
“In our MPCs, despite some softening in the national housing market, we experienced strong financial performance led by the sale of 111 residential acres at an impressive record average price of $1.35 million per acre. In Operating Assets, we continued to produce robust results with record NOI in office and multifamily and strong leasing rates across each property type. With our positive expectations for the second half of the year, we now expect to deliver record full-year 2025 MPC EBT of $430 million, representing a meaningful increase of $55 million compared to our previous estimates. In Operating Assets, we anticipate record full-year NOI of $267 million, or a $5 million increase compared to our initial guidance. Overall, we remain bullish on our full-year outlook and have raised our Adjusted Operating Cash Flow guidance expectations to approximately $410 million—or an increase of $60 million.
“In Strategic Developments, we recently launched pre-sales for residences at Melia and ‘Ilima, our newest condo developments at Ward Village. Designed by world-renowned architect Robert A.M. Stern Architects, with interiors by acclaimed design studio Champalimaud Design and landscape design by VITA Planning & Landscape Architecture, these future towers are undoubtedly the most highly anticipated condominiums to ever come to market in Honolulu. Boasting grand estate-style residences, resort-level amenities, and unrivaled front-row views of Ala Moana Beach and Diamond Head, demand thus far has been exceptional. The appeal of ‘Ilima is further enhanced by our partnership with Discovery Land Company, which will provide unparalleled amenities and services, cultivating an exclusive, members-only environment for residents and their families.”
Financial Highlights
Total Company
MPC
Operating Assets
Strategic Developments
Financing Activity
Full Year 2025 Guidance
Conference Call & Webcast Information
Howard Hughes Holdings Inc. will host its second quarter 2025 earnings conference call on Thursday, August 7, 2025, 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 webpage. 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 immediately after the call for a period of one year.
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 June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||
$ in thousands | 2025 | 2024 | $ Change | % Change | 2025 | 2024 | $ Change | % Change | |||||||||||||||||
Operating Assets NOI(1) | |||||||||||||||||||||||||
Office | $ | 35,159 | $ | 33,221 | $ | 1,938 | 6 | % | $ | 68,062 | $ | 63,819 | $ | 4,243 | 7 | % | |||||||||
Retail | 13,394 | 14,453 | (1,059 | ) | (7 | ) | % | 27,204 | 28,606 | (1,402 | ) | (5 | ) | % | |||||||||||
Multifamily | 16,872 | 14,163 | 2,709 | 19 | % | 32,635 | 27,940 | 4,695 | 17 | % | |||||||||||||||
Other | 1,431 | 1,064 | 367 | 34 | % | 2,973 | 2,530 | 443 | 18 | % | |||||||||||||||
Dispositions (a) | — | 442 | (442 | ) | (100 | ) | % | — | 801 | (801 | ) | (100 | ) | % | |||||||||||
Operating Assets NOI | 66,856 | 63,343 | 3,513 | 6 | % | 130,874 | 123,696 | 7,178 | 6 | % | |||||||||||||||
Company's share of NOI from unconsolidated ventures | 2,004 | 2,088 | (84 | ) | (4 | ) | % | 9,552 | 7,310 | 2,242 | 31 | % | |||||||||||||
Total Operating Assets NOI | $ | 68,860 | $ | 65,431 | $ | 3,429 | 5 | % | $ | 140,426 | $ | 131,006 | $ | 9,420 | 7 | % | |||||||||
Projected stabilized NOI Operating Assets ($ in millions) | $ | 353.3 | $ | 353.6 | $ | (0.3 | ) | — | % | ||||||||||||||||
MPC | |||||||||||||||||||||||||
Acres Sold - Residential | 111 | 164 | (53 | ) | (32 | ) | % | 181 | 195 | (14 | ) | (7 | ) | % | |||||||||||
Acres Sold - Commercial | — | — | — | NM | — | 4 | (4 | ) | (100 | ) | % | ||||||||||||||
Price Per Acre - Residential | $ | 1,350 | $ | 1,044 | $ | 306 | 29 | % | $ | 1,210 | $ | 973 | $ | 237 | 24 | % | |||||||||
Price Per Acre - Commercial | $ | — | $ | — | $ | — | NM | $ | — | $ | 801 | $ | (801 | ) | (100 | ) | % | ||||||||
MPC EBT | $ | 102,412 | $ | 123,241 | $ | (20,829 | ) | (17 | ) | % | $ | 165,676 | $ | 147,492 | $ | 18,184 | 12 | % | |||||||
Strategic Developments | |||||||||||||||||||||||||
Condominium rights and unit sales | $ | 193 | $ | — | $ | 193 | NM | $ | 535 | $ | 23 | $ | 512 | NM |
(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. through its wholly owned subsidiary, The Howard Hughes Corporation (HHC). Its award-winning assets include the country’s preeminent portfolio of master planned communities, as well as operating properties and development opportunities including The Woodlands®, Bridgeland® and The Woodlands Hills® in the Greater Houston, Texas area; Summerlin® in Las Vegas; Teravalis™ in the Greater Phoenix, Arizona area; Ward Village® in Honolulu, Hawaiʻi; and Merriweather District in Columbia, Maryland. HHC’s 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, HHC 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 of 1933 and Section 21E of the Securities Exchange Act of 1934. 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. We claim the protection of the Safe Harbor contained in the Private Securities Litigation Reform Act of 1995 for forward-looking statements. Forward-looking 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) our ability to realize the anticipated benefits of the transactions with Pershing Square and our new strategy; (ii) our inability to identify and consummate transactions as part of our new strategy of becoming a diversified holding company; (iii) risks inherent in acquiring or making investments in operating companies, especially companies in industries unrelated to our existing real estate business; (iv) our ability to realize the anticipated benefits of the spinoff of Seaport Entertainment Group Inc. that we completed in 2024, as well as other effects the spinoff may have on our ongoing business; (v) macroeconomic conditions such as volatility in capital markets, unstable economic and political conditions within the U.S. and foreign jurisdictions, geopolitical conflicts, and changes in trade policies and a prolonged recession in the national economy, including any adverse business or economic conditions in the homebuilding, condominium-development, retail, and office sectors; (vi) changes in trade policies, including tariffs or duties on construction or homebuilding materials, potential retaliatory actions by other countries, and related impacts on market conditions and business activity, (vii) our inability to obtain operating and development capital for our properties, including our inability to obtain or refinance debt capital from lenders and the capital markets; (viii) interest rate volatility and inflation; (ix) the availability of debt and equity capital; (x) our ability to compete effectively, including the potential impact of heightened competition for tenants and potential decreases in occupancy at our properties; (xi) general inflation, including core and wage inflation; commodity and energy price and currency volatility; as well as monetary, fiscal and policy interventions in anticipation of our reaction to such events, including increases in interest rates; (xii) mismatch of supply and demand, including interruptions of supply lines; (xiii) extreme weather conditions or climate change, including natural disasters, that may cause property damage or interrupt business; (xiv) the impact of water and electricity shortages; (xv) contamination of our property by hazardous or toxic substances; (xvi) terrorist activity, acts of violence, or breaches of our or our vendors’ data security; (xvii) losses that are not insured or exceed the applicable insurance limits; (xviii) our ability to lease new or redeveloped space; (xix) our ability to obtain the necessary governmental permits for the development of our properties and necessary regulatory approvals pursuant to an extensive entitlement process involving multiple and overlapping regulatory jurisdictions, which often require discretionary action by local governments; (xx) increased construction costs exceeding our original estimates, delays or overruns, claims for construction defects, or other factors affecting our ability to develop, redevelop or construct our properties; (xxi) terrorist activity, acts of violence, or breaches of our or our vendors’ data security; (xxii) regulation of the portion of our business that is dedicated to the formation and sale of condominiums, including regulatory filings to state agencies, additional entitlement processes, and requirements to transfer control to a condominium association’s board of directors in certain situations, as well as potential defaults by purchasers on their obligations to purchase condominiums; (xxiii) fluctuations in regional and local economies, the impact of changes in interest rates on residential housing and condominium markets, local real estate conditions, tenant rental rates, and competition from competing retail properties and the internet; (xxiv) inherent risks related to disruption of information technology networks and related systems, including cyber security attacks; (xxv) our ability to attract and retain key personnel; (xxvi) our ability to collect rent and attract tenants; (xxvii) our indebtedness, including our $750,000,000 5.375% Senior Notes due 2028, $650,000,000 4.125% Senior Notes due 2029 and $650,000,000 4.375% Senior Notes due 2031, contain restrictions that may limit our ability to operate our business; (xxviii) our directors’ involvement or interests in other businesses, including real estate activities and investments; (xxix) our inability to control certain of our properties due to the joint ownership of such property and our inability to successfully attract desirable strategic partners; (xxx) our dependence on the operations and funds of our subsidiaries, including The Howard Hughes Corporation; (xxxi) catastrophic events or geopolitical conditions, such as international armed conflicts, or the occurrence of epidemics or pandemics; and (xxxii) other risks and uncertainties described herein, as well as those risks and uncertainties discussed from time to time in our other reports and other public filings with the SEC. 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, 2024. 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.
Contacts
Media Relations:
Cristina Carlson
Howard Hughes
[email protected]
646-822-6910
Francis McGill
Pershing Square
[email protected]
212-909-2455
Investor Relations:
[email protected]
281-929-7700
HOWARD HUGHES HOLDINGS INC. | |||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||
UNAUDITED | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
thousands except per share amounts | 2025 | 2024 | 2025 | 2024 | |||||||||||
REVENUES | |||||||||||||||
Condominium rights and unit sales | $ | 193 | $ | — | $ | 535 | $ | 23 | |||||||
Master Planned Communities land sales | 125,041 | 154,790 | 196,683 | 187,205 | |||||||||||
Rental revenue | 111,092 | 105,479 | 219,505 | 206,848 | |||||||||||
Other land, rental, and property revenues | 10,416 | 10,294 | 20,060 | 20,405 | |||||||||||
Builder price participation | 14,138 | 12,905 | 23,425 | 25,471 | |||||||||||
Total revenues | 260,880 | 283,468 | 460,208 | 439,952 | |||||||||||
EXPENSES | |||||||||||||||
Condominium rights and unit cost of sales | 811 | — | 1,053 | 3,861 | |||||||||||
Master Planned Communities cost of sales | 45,178 | 57,768 | 70,392 | 70,672 | |||||||||||
Operating costs | 50,518 | 49,565 | 101,307 | 98,571 | |||||||||||
Rental property real estate taxes | 15,365 | 15,110 | 30,664 | 29,315 | |||||||||||
Provision for (recovery of) doubtful accounts | 542 | 256 | 386 | 137 | |||||||||||
General and administrative | 34,552 | 22,356 | 56,988 | 44,068 | |||||||||||
Depreciation and amortization | 44,325 | 46,571 | 89,464 | 90,745 | |||||||||||
Other | 4,273 | 3,868 | 9,070 | 7,686 | |||||||||||
Total expenses | 195,564 | 195,494 | 359,324 | 345,055 | |||||||||||
OTHER | |||||||||||||||
Gain (loss) on sale or disposal of real estate and other assets, net | 1,656 | — | 15,385 | 4,794 | |||||||||||
Other income (loss), net | 885 | 490 | (482 | ) | 1,381 | ||||||||||
Total other | 2,541 | 490 | 14,903 | 6,175 | |||||||||||
Operating income (loss) | 67,857 | 88,464 | 115,787 | 101,072 | |||||||||||
Interest income | 10,331 | 5,999 | 16,449 | 13,929 | |||||||||||
Interest expense | (43,694 | ) | (39,611 | ) | (84,788 | ) | (78,795 | ) | |||||||
Gain (loss) on extinguishment of debt | (307 | ) | (198 | ) | (307 | ) | (198 | ) | |||||||
Gain (loss) on sale of MUD receivables | (48,197 | ) | — | (48,197 | ) | — | |||||||||
Equity in earnings (losses) from unconsolidated ventures | (1,887 | ) | 6,255 | (567 | ) | (2,600 | ) | ||||||||
Income (loss) from continuing operations before income taxes | (15,897 | ) | 60,909 | (1,623 | ) | 33,408 | |||||||||
Income tax expense (benefit) | (3,821 | ) | 13,542 | (385 | ) | 7,041 | |||||||||
Net income (loss) from continuing operations | (12,076 | ) | 47,367 | (1,238 | ) | 26,367 | |||||||||
Net income (loss) from discontinued operations, net of taxes | — | (26,309 | ) | — | (57,776 | ) | |||||||||
Net income (loss) | (12,076 | ) | 21,058 | (1,238 | ) | (31,409 | ) | ||||||||
Net (income) loss attributable to noncontrolling interests | (68 | ) | 34 | (373 | ) | 24 | |||||||||
Net income (loss) attributable to common stockholders | $ | (12,144 | ) | $ | 21,092 | $ | (1,611 | ) | $ | (31,385 | ) | ||||
Basic income (loss) per share — continuing operations | $ | (0.22 | ) | $ | 0.95 | $ | (0.03 | ) | $ | 0.53 | |||||
Diluted income (loss) per share — continuing operations | $ | (0.22 | ) | $ | 0.95 | $ | (0.03 | ) | $ | 0.53 | |||||
HOWARD HUGHES HOLDINGS INC. | |||||||
CONSOLIDATED BALANCE SHEETS | |||||||
UNAUDITED | |||||||
thousands except par values and share amounts | June 30, 2025 | December 31, 2024 | |||||
ASSETS | |||||||
Master Planned Communities assets | $ | 2,564,180 | $ | 2,511,662 | |||
Buildings and equipment | 3,873,754 | 3,841,872 | |||||
Less: accumulated depreciation | (1,016,906 | ) | (949,533 | ) | |||
Land | 304,290 | 302,446 | |||||
Developments | 1,705,973 | 1,341,029 | |||||
Net investment in real estate | 7,431,291 | 7,047,476 | |||||
Investments in unconsolidated ventures | 164,461 | 169,566 | |||||
Cash and cash equivalents | 1,441,026 | 596,083 | |||||
Restricted cash | 357,803 | 402,420 | |||||
Accounts receivable, net | 121,454 | 105,185 | |||||
Municipal Utility District (MUD) receivables, net | 389,828 | 463,799 | |||||
Deferred expenses, net | 140,868 | 139,350 | |||||
Operating lease right-of-use assets | 5,532 | 5,806 | |||||
Other assets, net | 245,416 | 281,551 | |||||
Total assets | $ | 10,297,679 | $ | 9,211,236 | |||
LIABILITIES | |||||||
Mortgages, notes, and loans payable, net | $ | 5,223,852 | $ | 5,127,469 | |||
Operating lease obligations | 5,338 | 5,456 | |||||
Deferred tax liabilities, net | 139,733 | 142,100 | |||||
Accounts payable and other liabilities | 1,217,112 | 1,094,437 | |||||
Total liabilities | 6,586,035 | 6,369,462 | |||||
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, 65,883,495 issued, and 59,363,221 outstanding as of June 30, 2025, 56,610,009 shares issued, and 50,116,150 outstanding as of December 31, 2024 | 659 | 566 | |||||
Additional paid-in capital | 4,450,854 | 3,576,274 | |||||
Retained earnings (accumulated deficit) | (187,604 | ) | (185,993 | ) | |||
Accumulated other comprehensive income (loss) | (724 | ) | 1,968 | ||||
Treasury stock, at cost, 6,520,274 shares as of June 30, 2025, and 6,493,859 shares as of December 31, 2024 | (618,507 | ) | (616,589 | ) | |||
Total stockholders' equity | 3,644,678 | 2,776,226 | |||||
Noncontrolling interests | 66,966 | 65,548 | |||||
Total equity | 3,711,644 | 2,841,774 | |||||
Total liabilities and equity | $ | 10,297,679 | $ | 9,211,236 | |||
Segment Earnings Before Taxes (EBT)
The Company has three business segments, Operating Assets, MPC, and Strategic Developments. 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.
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
thousands | 2025 | 2024 | $ Change | 2025 | 2024 | $ Change | |||||||||||||||||
Operating Assets Segment EBT | |||||||||||||||||||||||
Total revenues | $ | 116,446 | $ | 110,760 | $ | 5,686 | $ | 230,448 | $ | 217,760 | $ | 12,688 | |||||||||||
Total operating expenses | (49,467 | ) | (47,610 | ) | (1,857 | ) | (98,284 | ) | (93,764 | ) | (4,520 | ) | |||||||||||
Segment operating income (loss) | 66,979 | 63,150 | 3,829 | 132,164 | 123,996 | 8,168 | |||||||||||||||||
Depreciation and amortization | (42,305 | ) | (41,811 | ) | (494 | ) | (85,428 | ) | (83,651 | ) | (1,777 | ) | |||||||||||
Interest income (expense), net | (34,173 | ) | (34,165 | ) | (8 | ) | (68,391 | ) | (67,107 | ) | (1,284 | ) | |||||||||||
Other income (loss), net | 634 | 542 | 92 | 438 | 950 | (512 | ) | ||||||||||||||||
Equity in earnings (losses) from unconsolidated ventures | (325 | ) | 336 | (661 | ) | 4,318 | 6,153 | (1,835 | ) | ||||||||||||||
Gain (loss) on sale or disposal of real estate and other assets, net | (1 | ) | — | (1 | ) | 9,978 | 4,794 | 5,184 | |||||||||||||||
Gain (loss) on extinguishment of debt | (307 | ) | (198 | ) | (109 | ) | (307 | ) | (198 | ) | (109 | ) | |||||||||||
Operating Assets segment EBT | $ | (9,498 | ) | $ | (12,146 | ) | $ | 2,648 | $ | (7,228 | ) | $ | (15,063 | ) | $ | 7,835 | |||||||
Master Planned Communities Segment EBT | |||||||||||||||||||||||
Total revenues | $ | 143,701 | $ | 172,181 | $ | (28,480 | ) | $ | 228,155 | $ | 221,056 | $ | 7,099 | ||||||||||
Total operating expenses | (57,694 | ) | (70,883 | ) | 13,189 | (95,899 | ) | (95,932 | ) | 33 | |||||||||||||
Segment operating income (loss) | 86,007 | 101,298 | (15,291 | ) | 132,256 | 125,124 | 7,132 | ||||||||||||||||
Depreciation and amortization | (88 | ) | (108 | ) | 20 | (199 | ) | (218 | ) | 19 | |||||||||||||
Interest income (expense), net | 18,107 | 16,168 | 1,939 | 34,893 | 31,414 | 3,479 | |||||||||||||||||
Other income (loss), net | 35 | — | 35 | 35 | — | 35 | |||||||||||||||||
Equity in earnings (losses) from unconsolidated ventures | (1,649 | ) | 5,883 | (7,532 | ) | (5,059 | ) | (8,828 | ) | 3,769 | |||||||||||||
Gain (loss) on sale or disposal of real estate and other assets, net | — | — | — | 3,750 | — | 3,750 | |||||||||||||||||
MPC segment EBT | $ | 102,412 | $ | 123,241 | $ | (20,829 | ) | $ | 165,676 | $ | 147,492 | $ | 18,184 | ||||||||||
Strategic Developments Segment EBT | |||||||||||||||||||||||
Total revenues | $ | 714 | $ | 509 | $ | 205 | $ | 1,568 | $ | 1,102 | $ | 466 | |||||||||||
Total operating expenses | (5,186 | ) | (4,206 | ) | (980 | ) | (9,552 | ) | (12,860 | ) | 3,308 | ||||||||||||
Segment operating income (loss) | (4,472 | ) | (3,697 | ) | (775 | ) | (7,984 | ) | (11,758 | ) | 3,774 | ||||||||||||
Depreciation and amortization | (1,076 | ) | (3,878 | ) | 2,802 | (2,234 | ) | (5,297 | ) | 3,063 | |||||||||||||
Interest income (expense), net | 4,633 | 4,594 | 39 | 9,279 | 8,618 | 661 | |||||||||||||||||
Other income (loss), net | 132 | (17 | ) | 149 | (1,130 | ) | (14 | ) | (1,116 | ) | |||||||||||||
Equity in earnings (losses) from unconsolidated ventures | 87 | 36 | 51 | 174 | 75 | 99 | |||||||||||||||||
Gain (loss) on sale or disposal of real estate and other assets, net | 1,657 | — | 1,657 | 1,657 | — | 1,657 | |||||||||||||||||
Strategic Developments segment EBT | $ | 961 | $ | (2,962 | ) | $ | 3,923 | $ | (238 | ) | $ | (8,376 | ) | $ | 8,138 | ||||||||
Appendix – Reconciliation of Non-GAAP Measures
Below are GAAP to non-GAAP reconciliations of certain financial measures, as required under Regulation G promulgated by the Securities and Exchange Commission. 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 throughout this document. Total Operating Assets NOI represents 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 segment 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 is presented in the table below:
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
thousands | 2025 | 2024 | $ Change | 2025 | 2024 | $ Change | |||||||||||||||||
Operating Assets Segment | |||||||||||||||||||||||
Total revenues | $ | 116,446 | $ | 110,760 | $ | 5,686 | $ | 230,448 | $ | 217,760 | $ | 12,688 | |||||||||||
Total operating expenses | (49,467 | ) | (47,610 | ) | (1,857 | ) | (98,284 | ) | (93,764 | ) | (4,520 | ) | |||||||||||
Segment operating income (loss) | 66,979 | 63,150 | 3,829 | 132,164 | 123,996 | 8,168 | |||||||||||||||||
Depreciation and amortization | (42,305 | ) | (41,811 | ) | (494 | ) | (85,428 | ) | (83,651 | ) | (1,777 | ) | |||||||||||
Interest income (expense), net | (34,173 | ) | (34,165 | ) | (8 | ) | (68,391 | ) | (67,107 | ) | (1,284 | ) | |||||||||||
Other income (loss), net | 634 | 542 | 92 | 438 | 950 | (512 | ) | ||||||||||||||||
Equity in earnings (losses) from unconsolidated ventures | (325 | ) | 336 | (661 | ) | 4,318 | 6,153 | (1,835 | ) | ||||||||||||||
Gain (loss) on sale or disposal of real estate and other assets, net | (1 | ) | — | (1 | ) | 9,978 | 4,794 | 5,184 | |||||||||||||||
Gain (loss) on extinguishment of debt | (307 | ) | (198 | ) | (109 | ) | (307 | ) | (198 | ) | (109 | ) | |||||||||||
Operating Assets segment EBT | (9,498 | ) | (12,146 | ) | 2,648 | (7,228 | ) | (15,063 | ) | 7,835 | |||||||||||||
Add back: | |||||||||||||||||||||||
Depreciation and amortization | 42,305 | 41,811 | 494 | 85,428 | 83,651 | 1,777 | |||||||||||||||||
Interest (income) expense, net | 34,173 | 34,165 | 8 | 68,391 | 67,107 | 1,284 | |||||||||||||||||
Equity in (earnings) losses from unconsolidated ventures | 325 | (336 | ) | 661 | (4,318 | ) | (6,153 | ) | 1,835 | ||||||||||||||
(Gain) loss on sale or disposal of real estate and other assets, net | 1 | — | 1 | (9,978 | ) | (4,794 | ) | (5,184 | ) | ||||||||||||||
(Gain) loss on extinguishment of debt | 307 | 198 | 109 | 307 | 198 | 109 | |||||||||||||||||
Impact of straight-line rent | (373 | ) | 24 | (397 | ) | (1,533 | ) | (823 | ) | (710 | ) | ||||||||||||
Other | (384 | ) | (373 | ) | (11 | ) | (195 | ) | (427 | ) | 232 | ||||||||||||
Operating Assets NOI | 66,856 | 63,343 | 3,513 | 130,874 | 123,696 | 7,178 | |||||||||||||||||
Company's share of NOI from equity investments | 2,004 | 2,088 | (84 | ) | 3,947 | 4,068 | (121 | ) | |||||||||||||||
Distributions from Summerlin Hospital investment | — | — | — | 5,605 | 3,242 | 2,363 | |||||||||||||||||
Company's share of NOI from unconsolidated ventures | 2,004 | 2,088 | (84 | ) | 9,552 | 7,310 | 2,242 | ||||||||||||||||
Total Operating Assets NOI | $ | 68,860 | $ | 65,431 | $ | 3,429 | $ | 140,426 | $ | 131,006 | $ | 9,420 | |||||||||||
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 June 30, | Six Months Ended June 30, | |||||||||||||||||||||
thousands | 2025 | 2024 | $ Change | 2025 | 2024 | $ Change | ||||||||||||||||
Same Store Office | ||||||||||||||||||||||
Houston, TX | $ | 23,188 | $ | 21,927 | $ | 1,261 | $ | 44,856 | $ | 42,170 | $ | 2,686 | ||||||||||
Columbia, MD | 6,595 | 6,260 | 335 | 12,386 | 12,358 | 28 | ||||||||||||||||
Las Vegas, NV | 5,554 | 5,070 | 484 | 11,202 | 9,328 | 1,874 | ||||||||||||||||
Total Same Store Office | 35,337 | 33,257 | 2,080 | 68,444 | 63,856 | 4,588 | ||||||||||||||||
Same Store Retail | ||||||||||||||||||||||
Houston, TX | 2,791 | 2,886 | (95 | ) | 5,605 | 5,511 | 94 | |||||||||||||||
Columbia, MD | 1,086 | 1,089 | (3 | ) | 2,415 | 2,157 | 258 | |||||||||||||||
Las Vegas, NV | 5,584 | 5,356 | 228 | 11,603 | 11,343 | 260 | ||||||||||||||||
Honolulu, HI | 3,706 | 5,061 | (1,355 | ) | 7,209 | 9,274 | (2,065 | ) | ||||||||||||||
Total Same Store Retail | 13,167 | 14,392 | (1,225 | ) | 26,832 | 28,285 | (1,453 | ) | ||||||||||||||
Same Store Multifamily | ||||||||||||||||||||||
Houston, TX | 10,155 | 9,073 | 1,082 | 19,890 | 18,478 | 1,412 | ||||||||||||||||
Columbia, MD | 3,788 | 3,220 | 568 | 7,145 | 5,832 | 1,313 | ||||||||||||||||
Las Vegas, NV | 2,929 | 1,869 | 1,060 | 5,600 | 3,630 | 1,970 | ||||||||||||||||
Company's share of NOI from unconsolidated ventures | 1,817 | 1,839 | (22 | ) | 3,538 | 3,840 | (302 | ) | ||||||||||||||
Total Same Store Multifamily | 18,689 | 16,001 | 2,688 | 36,173 | 31,780 | 4,393 | ||||||||||||||||
Same Store Other | ||||||||||||||||||||||
Houston, TX | 997 | 1,062 | (65 | ) | 2,064 | 2,017 | 47 | |||||||||||||||
Columbia, MD | (9 | ) | (24 | ) | 15 | (57 | ) | 427 | (484 | ) | ||||||||||||
Las Vegas, NV | 312 | 198 | 114 | 632 | 442 | 190 | ||||||||||||||||
Honolulu, HI | (52 | ) | 13 | (65 | ) | (28 | ) | 94 | (122 | ) | ||||||||||||
Company's share of NOI from unconsolidated ventures | 187 | 249 | (62 | ) | 6,014 | 3,470 | 2,544 | |||||||||||||||
Total Same Store Other | 1,435 | 1,498 | (63 | ) | 8,625 | 6,450 | 2,175 | |||||||||||||||
Total Same Store NOI | 68,628 | 65,148 | 3,480 | 140,074 | 130,371 | 9,703 | ||||||||||||||||
Non-Same Store NOI | 232 | 283 | (51 | ) | 352 | 635 | (283 | ) | ||||||||||||||
Total Operating Assets NOI | $ | 68,860 | $ | 65,431 | $ | 3,429 | $ | 140,426 | $ | 131,006 | $ | 9,420 | ||||||||||
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.
thousands | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | Year Ended December 31, 2024 | ||||||||
General and administrative (G&A) | $ | 34,552 | $ | 56,988 | $ | 91,752 | |||||
Less: Non-cash stock compensation | (6,167 | ) | (8,918 | ) | (9,104 | ) | |||||
Cash G&A | $ | 28,385 | $ | 48,070 | $ | 82,648 | |||||
Adjusted Condo Gross Profit
Adjusted condo gross profit 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 gross profit related to condominium sales closed in each period. This measure excludes costs in Condominium rights and unit cost of sales related to the remediation of construction defects at Waiea tower and costs related to a settlement agreement reached for the reimbursement of Waiea remediation costs.
thousands | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | Year Ended December 31, 2024 | ||||||||
Condominium rights and unit sales | $ | 193 | $ | 535 | $ | 778,616 | |||||
Condominium rights and unit cost of sales | (811 | ) | (1,053 | ) | (582,574 | ) | |||||
Less: Waiea settlement and remediation cost | — | — | 15,091 | ||||||||
Adjusted condo gross profit | $ | (618 | ) | $ | (518 | ) | $ | 211,133 | |||
Adjusted Operating Cash Flow Performance Measure
We define Adjusted Operating Cash Flow as the sum of the following non-GAAP performance measures: MPC EBT, Operating Asset NOI, condo gross profit, and cash G&A expense—all of which we have been using to measure our performance and providing guidance on for several years—as well as net interest expense (adjusted for interest income already included in MPC EBT). We believe Adjusted Operating Cash Flow provides investors a straightforward measure to model the Company’s overall financial performance against guidance. Also, by focusing on the core business metrics of each segment, Adjusted Operating Cash Flow offers a straightforward reflection of our operational and cash generation capabilities while highlighting the key drivers of future growth.
thousands | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | Year Ended December 31, 2024 | ||||||||
Total Operating Assets NOI | $ | 68,860 | $ | 140,426 | $ | 257,007 | |||||
MPC EBT | 102,412 | 165,676 | 349,134 | ||||||||
Adjusted condo gross profit | (618 | ) | (518 | ) | 211,133 | ||||||
Interest income (expense), net | (33,363 | ) | (68,339 | ) | (139,577 | ) | |||||
Less MPC Interest (income) expense, net (a) | (18,107 | ) | (34,893 | ) | (60,473 | ) | |||||
Cash G&A | (28,385 | ) | (48,070 | ) | (82,648 | ) | |||||
Adjusted Operating Cash Flow Performance Measure | $ | 90,799 | $ | 154,282 | $ | 534,576 |
(a) Represents interest income for the MPC segment, which is included in MPC EBT.
A reconciliation of Net income (loss) from continuing operations attributable to common stockholders to Adjusted Operating Cash Flow is presented in the table below:
Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | Year Ended December 31, 2024 | ||||||||||||||||||
thousands except per share amounts | (per diluted share) | (per diluted share) | (per diluted share) | |||||||||||||||||
Net income (loss) from continuing operations attributable to common stockholders | $ | (12,144 | ) | $ | (0.22 | ) | $ | (1,611 | ) | $ | (0.03 | ) | $ | 285,926 | $ | 5.73 | ||||
Adjustments to reconcile to Adjusted Operating Cash Flow Performance Measure: | ||||||||||||||||||||
Corporate Adjustments | ||||||||||||||||||||
Net (income) loss attributable to noncontrolling interests | 68 | 373 | (711 | ) | ||||||||||||||||
Income tax expense (benefit) | (3,821 | ) | (385 | ) | 80,184 | |||||||||||||||
Non-cash stock compensation expense | 6,167 | 8,918 | 9,104 | |||||||||||||||||
(Gain) loss on sale of MUD receivables | 48,197 | 48,197 | 48,651 | |||||||||||||||||
Other Corporate Items | 5,093 | 10,528 | 17,236 | |||||||||||||||||
Total | 55,704 | 1.01 | 67,631 | 1.29 | 154,464 | 3.09 | ||||||||||||||
Operating Assets Adjustments | ||||||||||||||||||||
Depreciation and amortization | 42,305 | 85,428 | 169,040 | |||||||||||||||||
Equity in (earnings) losses from unconsolidated ventures | 325 | (4,318 | ) | (5,819 | ) | |||||||||||||||
(Gain) loss on sale or disposal of real estate and other assets, net | 1 | (9,978 | ) | (22,907 | ) | |||||||||||||||
(Gain) loss on extinguishment of debt | 307 | 307 | 465 | |||||||||||||||||
Impact of straight-line rent | (373 | ) | (1,533 | ) | (4,770 | ) | ||||||||||||||
Other | (384 | ) | (195 | ) | (306 | ) | ||||||||||||||
Company's share of NOI from unconsolidated ventures | 2,004 | 9,552 | 11,552 | |||||||||||||||||
Total | 44,185 | 0.80 | 79,263 | 1.51 | 147,255 | 2.95 | ||||||||||||||
Strategic Developments Adjustments | ||||||||||||||||||||
Rental revenue | 26 | (33 | ) | (459 | ) | |||||||||||||||
Other land, rental, and property revenues | (547 | ) | (1,000 | ) | (4,321 | ) | ||||||||||||||
Operating costs | 3,760 | 7,336 | 17,670 | |||||||||||||||||
Rental property real estate taxes | 615 | 1,163 | 2,480 | |||||||||||||||||
Depreciation and amortization | 1,076 | 2,234 | 7,255 | |||||||||||||||||
Other (income) loss, net | (132 | ) | 1,130 | (90,534 | ) | |||||||||||||||
Equity in (earnings) losses from unconsolidated ventures | (87 | ) | (174 | ) | (251 | ) | ||||||||||||||
(Gain) loss on sale or disposal of real estate and other assets, net | (1,657 | ) | (1,657 | ) | — | |||||||||||||||
Waiea settlement and remediation costs | — | — | 15,091 | |||||||||||||||||
Total | 3,054 | 0.05 | 8,999 | 0.17 | (53,069 | ) | (1.06 | ) | ||||||||||||
Adjusted Operating Cash Flow Performance Measure | $ | 90,799 | $ | 1.64 | $ | 154,282 | $ | 2.94 | $ | 534,576 | $ | 10.71 | ||||||||
Aug-06 | |
Aug-06 | |
Aug-06 | |
Aug-06 | |
Aug-06 | |
Aug-05 | |
Aug-05 | |
Aug-04 | |
Jul-28 | |
Jul-22 | |
Jul-22 | |
Jul-10 | |
Jul-07 | |
Jul-06 | |
Jun-24 |
Join thousands of traders who make more informed decisions with our premium features. Real-time quotes, advanced visualizations, backtesting, and much more.
Learn more about FINVIZ*Elite