Hudson Pacific Properties, Inc. · NYSE:HPP
Hudson Pacific Properties — Investor Presentation (October 2024)
25 slides from Hudson Pacific Properties's investor presentation, Oct 1, 2024
Slide 1: Hudson Pacific Properties | Company Overview 2Q 2024
Hudson Pacific Properties | Company Overview 2Q 2024
Slide 2: Investment Highlights
Investment Highlights Unique Tech & Media Focus Only publicly traded REIT focused on acquiring, transforming, developing, leasing and operating premier real estate and related services demanded by the dynamic and synergistic tech and media industries Powerful Long-Term Leasing Drivers with Green Sho
Slide 3: Portfolio Spans Tech & Media Epicenters
Portfolio Spans Tech & Media Epicenters In-service office and studio portfolio located in established tech and media markets with favorable long-term growth characteristics In-Service Sq Ft YTD HPP’s Share NOI% by Region by Region 15M Sq Ft $180M NOI VANCOUVER (BC) VANCOUVER (BC) 1.5M 3% SEATTLE SEA
Slide 4: Modern & Amenitized Office Portfolio
Modern & Amenitized Office Portfolio Well-located, predominantly Class A office assets are modern, sustainable and amenitized to capture current and future leasing demand Existing Office Portfolio Comprised of 46 Properties and 14.7M Sq Ft1 HPP Office Asset Attributes & Amenities2 Vancouver (Canada)
Slide 5: Quality, Innovation-Focused Office Tenancy
Quality, Innovation-Focused Office Tenancy Premier office portfolio focused on tech and media markets attracts leading public and established private companies with growth potential 10 Largest Tenants Share of ABR by Public / Private & Age2 HPP’s Share Tenant % ABR 6% 10.2% 5.5% 5.1% 35% 3.8% 59% 3.
Slide 6: West Coast Office Leasing Green Shoots
West Coast Office Leasing Green Shoots HPP’s markets showing signs of stabilizing due to improved gross leasing, tenant demand and sublease availability, coupled with minimal new supply pipelines Positive HPP Market Trends – 2Q24 v. 2Q23 San W. Los San Francisco Silicon Valley Seattle Vancouver Ange
Slide 7: Tech & AI Investment in HPP's Markets
Tech & AI Investment in HPP’s Markets Target markets contain some of the world’s foremost innovation networks and primary recipients of venture capital and AI investments, which remain strong with potential to grow HPP Markets Historically Capture 2024 U.S. VC Investment Trending ~45% of U.S. VC Inv
Slide 8: Strong 1H24 Office Leasing Activity
Strong 1H24 Office Leasing Activity HPP signed over 1 million square feet of leases year-to-date, 40% ahead of 1H23 and new leasing as a percent of total at highest levels since 1Q19 HPP YOY Leasing Activity Leasing Pipeline Continues to Grow & Tours Remain Elevated1 1H23 1Q24 2Q24 1H24 Sq Ft (in th
Slide 9: Potential to Grow Office Occupancy 2026 & Beyond
Potential to Grow Office Occupancy 2026 & Beyond HPP expects to realize benefits from lower annual expirations starting in 2026 and beyond with the potential to stabilize and ultimately grow occupancy HPP Leasing Activity on Track to Begin to HPP Lease Expirations Expected to Trend Meaningfully Outp
Slide 10: Vertically Integrated Studio Business
Vertically Integrated Studio Business Positioned to become the first-choice provider of scale for all facets of original content production and maximize share of the addressable market HPP cross-sells services and stages to get Stage Ancillary “first look” at productions, further enhancing + Lightin
Slide 11: Stage-Led Strategy in Major Film & TV Markets
Stage-Led Strategy in Major Film & TV Markets Focus on owning real estate in global media “hubs” while leveraging services as low-capital- intensive entry point into “spoke” markets Existing Studio Portfolio Comprised of 75 Stages and 2.4M Sq Ft Hub Market Spoke Market Top Productions & Spend Strong
Slide 12: Quality, Diversified Studio Clientele
Quality, Diversified Studio Clientele Stage and services agreement terms vary based on production type, but HPP facilities primarily cater to film and TV productions typically backed by high-credit quality corporations Film & TV Commercials & Print Client Examples1 % Stage Sq Ft2 ~95% ~5% 3 – 12 Mon
Slide 13: Potential for Studio NOI Growth Post-Strikes
Potential for Studio NOI Growth Post-Strikes Union negotiations and strikes caused unprecedented disruption over last ~18 months, but recent resolution creates opportunity for production to stabilize HPP Does Not Require Peak 2023 First Time Since 1960 that WGA and SAG-AFTRA Production for Studio On
Slide 14: Expert Office & Studio Developer
Expert Office & Studio Developer Decades of experience delivering award-winning redevelopment and ground-up construction projects in complex urban environments for top-tier companies ICON EPIC 450 ALASKAN 6M+ Sq Ft Successfully Entitled, Designed, and / or Developed Hollywood (Los Angeles) Hollywood
Slide 15: Selective Development & Diversified Future Pipeline
Selective Development & Diversified Future Pipeline Recently completed and under construction projects require minimal additional spend, while future pipeline consists of office and studio opportunities to execute on when timing is right Recently Completed / In Lease Up – Studio Recently Completed /
Slide 16: Capital Allocation Focused on Deleveraging
Capital Allocation Focused on Deleveraging Proactively pursuing measures to further deleverage and fortify balance sheet, with improving studio cash flow to organically strengthen key metrics No Debt Maturities Until 4Q25 and Expect to Execute on Refinancings of Assets with significant WALT4 $760M T
Slide 17: $1B+ Opportunistic Asset Sales Completed
$1B+ Opportunistic Asset Sales Completed HPP continues to successfully source opportunities to sell non-core assets to unlock value and apply net proceeds to reduce leverage Gross Brokered / Reverse Sq Ft Type Location Buyer Use Proceeds Inquiries 2022 Sales1 498K $145M 100% ~70% Los Angeles, 100% P
Slide 18: Top-Ranked Corporate Responsibility Program
Top-Ranked Corporate Responsibility Program HPP’s corporate responsibility initiatives leverage deep experience across every aspect of office and studio real estate and related services to create value for stakeholders HPPx2030 Vision & Progress Office Americas Sector Key 2030 Goals Progress (as of
Slide 19: Seasoned Leadership Team
Seasoned Leadership Team Senior executives have ~13 years average tenure at HPP, vertically integrated expertise across office and studio sectors, and a track record of execution and value creation Key Team Members Victor Coleman Mark Lammas Lisa Burelli Harout Diramerian Drew Gordon Kay Tidwell Gen
Slide 20: Appendix
Appendix UDSON 20
Slide 21: Definitions
Definitions Annualized Base Rent (“ABR”): For office properties, calculated by multiplying (i) cash base rents under commenced leases excluding tenant reimbursements as of June 31, 2024 by (ii) 12. On a per square foot basis, ABR is divided by square footage under commenced leases as of June 31, 202
Slide 22: Reconciliations
Reconciliations RECONCILIATION OF NET LOSS TO STUDIO CASH NOI AND HPP'S SHARE OF STUDIO CASH NOI Six Months Ended Year Ended Three Months 6/30/24 12/31/23 Ended 12/31/22 Net loss $ (100,912) $ (170,700) $ (5,656) Adjustments: Loss from unconsolidated real estate entities 3,224 3,902 788 Fee income (
Slide 23: Reconciliations (Cont.)
Reconciliations (Cont.) RECONCILIATIONS OF TOTAL ASSETS TO HPP’S SHARE OF UNDEPRECIATED BOOK VALUE AND TOTAL UNSECURED AND SECURED DEBT TO HPP’S SHARE OF DEBT, NET 6/30/24 Total assets $ 8,352,782 Add: Accumulated depreciation 1,824,042 Add: Accumulated amortization 188,716 Less: Partners’ share of
Slide 24: Disclaimer
Disclaimer Hudson Pacific Properties, Inc. is referred to herein as the “Company,” “Hudson Pacific,” “HPP,” “we,” “us,” or “our.” This document contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange
Slide 25: HudsonPacificProperties.com
HudsonPacificProperties.com
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