Howard Hughes Holdings Inc. · NYSE:HHH
Howard Hughes — Q3 2018 Earnings Presentation
29 slides from Howard Hughes's earnings presentation, Nov 5, 2018
Slide 1: Supplemental Information Three months ended September 30, 2018
Seaport District Hughes Landing Three Merriweather New York, NY Houston, TX Columbia, MD Supplemental Information Three months ended September 30, 2018 NYSE: HHC The Howard Hughes Corporation, 13355 Noel Road, 22nd Floor, Dallas, TX 75240 HowardHughes.com 214.741.7744
Slide 2: Cautionary Statements
Cautionary Statements Cautionary Statements Forward Looking Statements This presentation includes forward-looking statements. Forward-looking statements give our current expectations relating to our financial condition, results of operations, plans, objectives, future performance and business. You c
Slide 3: Table of Contents
Table of Contents Table of Contents FINANCIAL OVERVIEW PORTFOLIO OVERVIEW PORTFOLIO PERFORMANCE DEBT & OTHER Company Profile 4 MPC Portfolio 12 Lease Expirations 14 Debt Summary 23 Financial Summary 6 Portfolio Key Metrics 13 Stabilized Properties 15 Property-Level Debt 24 Balance Sheets 7 Unstabili
Slide 4: Company Profile - Summary & Results
Company Profile - Summary & Results Company Profile - Summary & Results Company Overview - Q3 2018 Recent Company Highlights DALLAS--(PRNewswire)--Sept. 24, 2018-- The Howard Hughes Corporation announced that it has Exchange / Ticker NYSE: HHC closed on a secured, non-recourse corporate credit facil
Slide 5: Company Profile - Summary & Results (cont'd)
Company Profile - Summary & Results (con't) Company Profile - Summary & Results (cont'd) Path to Projected Annual Stabilized NOI Currently Under Construction Currently Unstabilized Currently Stabilized Total $ in millions $ in millions $ in millions $ in millions Retail & Office S.F. 2,430,200 Retai
Slide 6: Financial Summary
Financial Summary Financial Summary Company Profile Q3 2018 Q2 2018 Q1 2018 Q4 2017 Q3 2017 YTD Q3 2018 YTD Q3 2017 Share price1 $124.22 $132.50 $139.13 $131.27 $117.93 $124.22 $117.93 Market Capitalization2 $5.4b $5.7b $6.0b $5.9b $5.1b $5.4b $5.1b Enterprise Value3 $8.2b $8.3b $8.3b $7.9b $7.5b $8
Slide 7: Balance Sheets
Balance Sheets Balance Sheets (In thousands, except shares and par value amounts) Q3 2018 Q3 2017 FY 2017 FY 2016 ASSETS Unaudited Unaudited Investment in real estate: Master Planned Communities assets $ 1,621,168 $ 1,667,496 $ 1,642,278 $ 1,669,561 Buildings and equipment 2,510,945 2,155,071 2,238,
Slide 8: Statements of Operations
Statements of Operations Comparative Statements of Operations: Total Portfolio (In thousands, except share amounts) Q3 2018 Q3 2017 YTD Q3 2018 YTD Q3 2017 Revenues: Unaudited Unaudited Unaudited Unaudited Condominium rights and unit sales $ 8,045 $ 113,852 $ 39,767 $ 342,208 Master Planned Communit
Slide 9: Reconciliations of Net Income to FFO, Core FFO and AFFO
Reconciliations of Net Income to FFO, Core FFO and AFFO (In thousands, except share amounts) Q3 2018 Q3 2017 YTD Q3 2018 YTD Q3 2017 RECONCILIATIONS OF NET INCOME TO FFO Unaudited Unaudited Unaudited Unaudited Net income attributable to common stockholders $ 23,365 $ 10,504 $ 19,751 $ 19,283 Add: Se
Slide 10: NOI by Region
NOI by Region NOI by Region % Total 3Q18 Occupied (#) 3Q18 Leased (#) 3Q18 Occupied (%) 3Q18 Leased (%) 3Q18 Time to Ownership Annualized Stabilized Stabilize Property (a) Sq. Ft. Units Sq. Ft. Units Sq. Ft. Units Sq. Ft. Units Sq. Ft. Units NOI (b) NOI (c) (Years) Stabilized Properties Office - Hou
Slide 11: NOI by Region (cont'd)
NOI by Region (con't) NOI by Region % Total 3Q18 Occupied (#) 3Q18 Leased (#) 3Q18 Occupied (%) 3Q18 Leased (%) 3Q18 Time to Ownership Annualized Stabilized Stabilize Property (a) Sq. Ft. Units Sq. Ft. Units Sq. Ft. Units Sq. Ft. Units Sq. Ft. Units NOI (b) NOI (c) (Years) Under Construction Propert
Slide 12: MPC Portfolio
MPC Portfolio MPC Portfolio ($ in thousands) Nevada Texas Maryland Total (c) MPC Performance - 3Q18 & 3Q17 MPC Net Contribution (3Q18) (b) $90,697 $547 $(395) $90,849 MPC Net Contribution (3Q17) (b) $30,727 $(11,439) $(313) $18,975 Operating Asset Performance - 2018 & Future Annualized 3Q18 In-Place
Slide 13: Portfolio Key Metrics
Portfolio Key Metrics Portfolio Key Metrics MPC Regions Non-MPC Regions The The Woodlands Woodlands Hills Bridgeland Summerlin Columbia Total Hawaii Seaport Other Total Houston, TX Houston, TX Houston, TX Las Vegas, NV Columbia, MD MPC Regions Honolulu, HI New York, NY Non-MPC Operating - Stabilized
Slide 14: Lease Expirations
Lease Expirations Lease Expirations Office and Retail Lease Expirations Total Office and Retail Portfolio as of September 30, 2018 Office Expirations (a) Retail Expirations (a) Annualized Cash Rent Percentage of Wtd. Avg. Annualized Cash Annualized Cash Rent Percentage of Wtd. Avg. Annualized Cash E
Slide 15: Stabilized Properties
Stabilized Properties Stabilized Properties (Dollars in thousands) Rentable Q3 2018 Q3 2018 Annualized Est. Stabilized Property Location % Ownership Sq. Ft./Units % Occ. % Leased Q3 2018 NOI NOI Office 3 Waterway Square Houston, TX 100 % 232,021 96 % 100 % $ 6,913 $ 6,900 4 Waterway Square Houston,
Slide 16: Stabilized Properties (cont'd)
Stabilized Properties (con't) Stabilized Properties (cont'd) (Dollars in thousands) Rentable Sq. Ft. / Q3 2018 % Annualized Est. Stabilized Property Location % Ownership Units Q3 2018 % Occ. Leased Q3 2018 NOI NOI Residential Millennium Six Pines Apartments Houston, TX 100% 314 95 % 97% $ 3,718 $ 4,
Slide 17: Unstabilized Properties
Unstabilized Properties Unstabilized Properties (Dollars in thousands) Annualized % Rentable Sq. Q3 2018 Q3 2018 % Develop. Est. Total Cost Q3 2018 Est. Stabilized Est. Stab. Est. Stab. Project Name Location Ownership Ft. / Units % Occ. (a) Leased (a) Costs Incurred (Excl. Land) NOI NOI (b) Date Yie
Slide 18: Under Construction Properties
Under Construction Projects Under Construction Properties Dollars in thousands, except per sq. ft. and unit amounts Owned & Managed % Est. Rentable Percent Pre- Const. Est. Stabilized Develop. Est. Total Cost Stabilized Project Name City, State Ownership Sq. Ft. Leased1 Project Status Start Date Dat
Slide 19: Acquisition / Disposition Activity
Acquisition / Disposition Activity Acquisition / Disposition Activity In thousands, except rentable SF / Units / Acres 3Q 2018 Acquisitions Rentable Date Acquired Property % Ownership Location Sq. Ft. / Units / Acres Acquisition Price 9/7/2018 Lakefront North 100% Houston, TX 257,025 sq ft / 12.9 ac
Slide 20: Master Planned Community Land
Master Planned Community Land Master Planned Community Land The Woodlands The Woodlands Hills Bridgeland Summerlin Maryland Total (Dollars in thousands) Q3 2018 Q3 2017 Q3 2018 Q3 2017 Q3 2018 Q3 2017 Q3 2018 Q3 2017 Q3 2018 Q3 2017 Q3 2018 Q3 2017 Revenues: Residential land sale revenues $ 7,205 $
Slide 21: Ward Village Condominiums
Ward Village Condominiums Ward Village Condominiums Waiea (a) Anaha (b) Ae'o Ke Kilohana (c) Total Key Metrics Type of building Ultra-Luxury Luxury Upscale Workforce Number of units 174 317 465 423 1,379 Avg. unit Sq. Ft. 2,174 1,417 834 696 1,095 Condo Sq. Ft. 378,238 449,205 388,039 294,273 1,509,
Slide 22: Other Assets
Other Assets Other Assets Property Name City, State % Own Acres Notes Planned Future Development The Elk Grove Collection Elk Grove, CA 100% 64 Plan to build a 400,000 sq. ft. outlet retail center. Sold 36 acres for $36 million in total proceeds in 2017. Landmark Mall Alexandria, VA 100% 33 Plan to
Slide 23: Debt Summary
Debt Summary Debt Summary September 30, December 31, (In thousands) 2018 2017 Fixed-rate debt: Unsecured 5.375% Senior Notes due 2025 $ 1,000,000 $ 1,000,000 Secured mortgages, notes and loans payable 635,637 499,299 Special Improvement District bonds 16,058 27,576 Variable-rate debt: Mortgages, not
Slide 24: Property-Level Debt
Property-Level Debt Property-Level Debt (Dollars in thousands) Q3 2018 Principal Asset Balance Contract Interest Rate Interest Rate Hedge Current Annual Interest Rate Initial / Extended Maturity (a) Master Planned Communities The Woodlands Master Credit Facility $ 150,000 L+275 Floating/Cap 5.00% Ap
Slide 25: Property-Level Debt (cont'd)
Property-Level Debt (con't) (Dollars in thousands) Q3 2018 Principal Asset Balance Contract Interest Rate Interest Rate Hedge Current Annual Interest Rate Initial / Extended Maturity (a) Strategic Developments Ke Kilohana $ 69,393 L+325 Floating 5.51% Dec-19 / Dec-20 Ae'o 163,467 L+400 Floating/Cap
Slide 26: Summary of Ground Leases
Summary of Ground Leases Summary of Ground Leases Minimum Contractual Ground Lease Payments (dollars in thousands) Future Cash Payments Pro-Rata Three months ended Remaining Year Ending December 31, Ground Leased Asset Share Expiration Date September 30, 2018 2018 2019 Thereafter Total Riverwalk (a)
Slide 27: Definitions
Definitions Definitions Under Construction - Projects in the Strategic Developments segment for which construction has commenced as of September 30, 2018, unless otherwise noted. This excludes MPC and condominium development. Unstabilized - Properties in the Operating Assets segment that have been i
Slide 28: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures Reconciliation of Non-GAAP Measures Reconciliation of Operating Assets segment EBT to Total NOI: (In thousands) Q3 2018 Q2 2018 Q1 2018 Q4 2017 Q3 2017 YTD Q3 2018 YTD Q3 2017 Total Operating Assets segment EBT (a) $ (9,415) $ 4,715 $ 7,269 $ (11,834) $ (12,061) $
Slide 29: Reconciliation of Non-GAAP Measures (cont'd)
Reconciliation of Non-GAAP Measures (con't) Reconciliations of Non-GAAP Measures Reconciliation of MPC Land Sales Closed to GAAP Land Sales Revenue: Three Months Ended September 30, Nine Months Ended September 30, (In thousands) 2018 2017 2018 2017 Total residential land sales closed in period $ 116