Hudson Pacific Properties, Inc. · NYSE:HPP
Hudson Pacific Properties — Q1 2020 Earnings Presentation
59 slides from Hudson Pacific Properties's earnings presentation, May 8, 2020
Slide 1: Supplemental Information First Quarter 2020
PACIFIC PROPERTIES SUPPLEMENTAL INFORMATION FIRST QUARTER 2020 REIMAGINING NOW. TO CREATE WHAT'S NEXT.
Slide 2: Forward-Looking Statements
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Forward-Looking Statements This Supplemental Information 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 Act of 19
Slide 3: Table of Contents
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Table of Contents Page Executive Summary, Corporate Data, Executive Management, Board of Directors, Equity Research Coverage, Fixed Income Coverage and Rating 4 Agencies Financial Information 9 Consolidated Balance Sheets
Slide 4: Executive Summary
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Executive Summary Hudson Pacific Properties acquires, redevelops and develops creative office Studio Highlights and studio properties in the West Coast tech and media epicenters of Los • Trailing 12-month occupancy for the
Slide 5: Corporate Data
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Corporate Data(1) Unaudited, in thousands, except per share data March 31, December 31, September 30, June 30, March 31, 2020 2019 2019 2019 2019 Number of office properties owned 52 52 52 53 52 Office square feet(2) 14,85
Slide 6: Executive Management
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Executive Management Our Executive Management is comprised of highly seasoned, approachable experts who embrace innovation and always think outside the box. Together, they have decades of experience leading successful publ
Slide 7: Board of Directors
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Board of Directors Our accomplished Directors are committed to sound corporate governance, and ensuring full compliance and accountability to shareholders in accordance with all laws and regulations. We believe that dedica
Slide 8: Equity Research Coverage, Fixed Income Coverage and Rating Agencies
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Equity Research Coverage BofA Securities Mizuho James Feldman Haendel St. Juste (646) 855-5808 (212) 209-9300 BTIG Morgan Stanley Tom Catherwood Vikram Malhotra (212) 738-6140 (212) 761-7567 Citigroup Piper Sandler & Compa
Slide 9: Financial Information
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Financial Information
Slide 10: Consolidated Balance Sheets
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Consolidated Balance Sheets In thousands, except share data March 31, 2020 December 31, 2019 (Unaudited) ASSETS Investment in real estate, net $ 6,407,206 $ 6,370,849 Cash and cash equivalents 392,136 46,224 Restricted cas
Slide 11: Consolidated Statements of Operations
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Consolidated Statements of Operations Unaudited, in thousands, except share data Three Months Ended March 31, 2020 2019 REVENUES Office Rental $ 181,113 $ 170,197 Service and other revenues 5,314 5,661 Total office revenue
Slide 12: Funds from Operations
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Funds from Operations(1) Unaudited, in thousands, except per share data Three Months Ended Quarter To Date March 31, 2020 December 31, 2019 September 30, 2019 June 30, 2019 March 31, 2019 NET INCOME (LOSS) $ 13,949 $ 16,96
Slide 13: Funds from Operations (continued)
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Funds from Operations (continued) Unaudited, in thousands, except per share data Three Months Twelve Months Nine Months Six Months Three Months Ended Ended Ended Ended Ended Year To Date March 31, 2020 December 31, 2019 Se
Slide 14: Adjusted Funds from Operations
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Adjusted Funds from Operations(1) Unaudited, in thousands Three Months Ended Quarter To Date March 31, 2020 December 31, 2019 September 30, 2019 June 30, 2019 March 31, 2019 FFO $ 81,863 $ 84,555 $ 79,228 $ 75,478 $ 76,397
Slide 15: Same-Store Property Performance—Consolidated
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Same-Store Property Performance—Consolidated Unaudited, in thousands, except number of properties and square feet SAME-STORE STATISTICS Three Months Ended March 31, 2020 2019 % change SAME-STORE OFFICE STATISTICS(1)(2) Num
Slide 16: Same-Store Property Performance—Consolidated (continued)
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Same-Store Property Performance—Consolidated (continued) Unaudited, in thousands, except number of properties and square feet SAME-STORE ANALYSIS—NET OPERATING INCOME (CASH BASIS) Three Months Ended March 31, 2020 2019 % c
Slide 17: Same-Store Property Performance—Company's Share
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Same-Store Property Performance—Company’s Share Unaudited, in thousands, except number of properties and square feet SAME-STORE STATISTICS Three Months Ended March 31, 2020 2019 % change SAME-STORE OFFICE STATISTICS(1)(2)
Slide 18: Same-Store Property Performance—Company's Share (continued)
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Same-Store Property Performance—Company’s Share (continued) Unaudited, in thousands, except number of properties and square feet SAME-STORE ANALYSIS—NET OPERATING INCOME (CASH BASIS) Three Months Ended June 30, 2019 2018 %
Slide 19: Net Operating Income Detail (NOI)
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Net Operating Income Detail (NOI) Three Months Ended March 31, 2020 | Unaudited, in thousands Repositioning/ Same-Store Same-Store Non-Same- Redevelopment Office Studio Store Office /Development Lease-Up Sold/Other Total P
Slide 20: Net Operating Income Detail (NOI) (continued)
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Net Operating Income Detail (NOI) (continued) (1) See pages 27 and 28 for same-store office for the three months ended March 31, 2020. (2) Same-store studio includes Sunset Bronson Studios, Sunset Gower Studios and Sunset
Slide 21: Debt Summary
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Debt Summary As of March 31, 2020 | Unaudited, in thousands Unsecured revolving credit facility Principal Contractual Annual Debt Balance at Amount(1) Interest Rate(2)(3) Maturity Date(4) Service(1) Maturity Capacity Undra
Slide 22: Debt Summary (continued)
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Debt Summary (continued) As of March 31, 2020 | Unaudited, in thousands Secured notes Contractual Maturity Undrawn Principal Amount(1) Interest Rate(2) Date Annual Debt Service(1) Balance at Maturity Company’s Share Capaci
Slide 23: Capital Structure
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Capital Structure As of March 31, 2020 | Unaudited, in thousands, except share data and percentages Aggregate Principal Amount or $ Shares/Units Equivalent Unsecured revolving credit facility $ 490,000 Unsecured term loans
Slide 24: Debt Maturities, Composition and Covenant Compliance
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Unsecured and Secured Debt Maturities, Composition and Covenant Compliance Unaudited, in thousands DEBT COMPOSITION DEBT COVENANT COMPLIANCE Weighted Average Actual % of Total Interest Years to Covenant Performance Amount
Slide 25: Debt Maturities, Composition and Covenant Compliance (continued)
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Unsecured and Secured Debt Maturities, Composition and Covenant Compliance (continued) (1) Includes the Company’s Share of principal amortization and maturities, based on contractual maturity dates, excluding: (i) in-subst
Slide 26: Operational and Portfolio Information
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Operational and Portfolio Information
Slide 27: In-Service Office Properties
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 In-Service Office Properties(1) Square Percent Annualized Percent Annualized Base Rent Per Submarket Feet(2) Occupied(3) Leased(3) Base Rent(4) Square Foot(4) SAME-STORE(5) Greater Seattle, Washington Northview Center Lynn
Slide 28: In-Service Office Properties (continued)
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 In-Service Office Properties(1) (continued) Annualized Square Percent Percent Annualized Base Rent Per Submarket Feet(2) Occupied(3) Leased(3) Base Rent(4) Square Foot(4) 10900 Washington West Los Angeles 9,919 100.0 100.0
Slide 29: In-Service Office Properties (continued)
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 In-Service Office Properties(1) (continued) (1) In-service office excludes the land, repositioning, redevelopment, development and held for sale properties described on pages 33 and 34. We define lease-up properties as off
Slide 30: In-Service Office Properties by Location
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 In-Service Office Properties by Location(1) Annualized Base Square Occupied Percent Leased Percent Annualized Rent Per Square Properties Feet(2) Square Feet Occupied(3) Square Feet Leased(3) Base Rent(4) Foot(4) STABILIZED
Slide 31: In-Service Office Properties by Location (continued)
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 In-Service Office Properties by Location(1) (continued) Annualized Base Square Occupied Percent Leased Percent Annualized Rent Per Square Properties Feet(2) Square Feet Occupied(3) Square Feet Leased(3) Base Rent(4) Foot(4
Slide 32: Studio Properties
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Studio Properties Square Percent of Percent Annual Annual Base Rent Per Feet Total Leased Base Rent Leased Square Foot Sunset Gower Studios 531,756 43.4% 93.8% $ 18,741,506 $ 37.59 Sunset Bronson Studios 308,026 25.2 99.2
Slide 33: Land Properties
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Land Properties Submarket Square Feet(1) Percent of Total Vancouver, British Columbia Bentall Centre—Development(2) Downtown Vancouver 450,000 16.8% Subtotal 450,000 16.8% Greater Seattle, Washington Washington 1000(3) Den
Slide 34: Repositioning, Redevelopment, Development and Held For Sale Properties
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Repositioning, Redevelopment, Development and Held For Sale Properties(1) Annualized Estimated Occupied Percent Leased Percent Annualized Base Rent Per Submarket Square Feet(2) Square Feet Occupied(3) Square Feet Leased(3)
Slide 35: Repositioning, Redevelopment, Development and Held For Sale Properties (continued)
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Repositioning, Redevelopment, Development and Held For Sale Properties(1) (continued) (5) Reclassification of a portion of an asset for purposes of improving its quality and value through investment of significant capital,
Slide 36: Under Construction and Future Development Projects
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Under Construction and Future Development Projects Unaudited, in thousands, except square feet Estimated Construction Period Project Costs(1) Estimated Initial Project Total Stabilized Estimated Estimated Estimated Costs E
Slide 37: Under Construction and Future Development Projects (continued)
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Under Construction and Future Development Projects (continued) (6) Estimated initial stabilized yield on project costs calculated as the quotient of the estimated NOI and our investment in the property once the project has
Slide 38: Recently Completed, Under Construction and Planned Project Images
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Recently Completed, Under Construction and Planned Project Images Fourth & Traction | Redevelopment CUE | Development 450 Alaskan | Development 95 Jackson | Redevelopment Los Angeles (Arts District) Los Angeles (Hollywood)
Slide 39: Office Tenant Industry Diversification
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Office Tenant Industry Diversification(1) INDUSTRY DIVERSIFICATION TECHNOLOGY DIVERSIFICATION Company’s Share Company’s Share Annualized Annualized Annualized Annualized Base Rent as Base Rent as Base Rent Base Rent Percen
Slide 40: Fifteen Largest Office Tenants
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Fifteen Largest Office Tenants Company’s Share Total Total Percent of Percent of Credit Rating(3) Market Lease Occupied Occupied Rentable Annualized Annualized Capitalization (1) Tenant Property Expiration Square Feet Squa
Slide 41: Fifteen Largest Office Tenants (continued)
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Fifteen Largest Office Tenants (continued) (8) Salesforce.com expirations by square footage: (i) 83,016 square feet expiring on July 31, 2025, (ii) 83,372 square feet expiring on April 30, 2027, (iii) 93,028 square feet ex
Slide 42: Office Property Leasing Activity
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Office Property Leasing Activity(1) Three Months Ended March 31, 2020 Total gross leasing activity Rentable square feet(2) 228,932 Gross new leasing activity Rentable square feet 139,780 New cash rate $50.15 Gross renewal
Slide 43: Office Property Leasing Activity (continued)
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Office Property Leasing Activity(1) (continued) (1) Represents 100% share of consolidated and unconsolidated joint ventures. (2) Includes square footage related to the Company’s management offices totaling 23,561 square fe
Slide 44: Commenced Office Leases with Non-Recurring Upfront Abatements
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Commenced Office Leases with Non-Recurring Upfront Abatements(1) Square Lease Rent Starting Lease Submarket Feet Start Date Start Date Base Rents(2) Expiration Date San Francisco Bay Area, California Ferry Building(3) San
Slide 45: Uncommenced Office Leases—Next Eight Quarters
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Uncommenced Office Leases—Next Eight Quarters(1)(2) Company’s Share Q2 2020 Q3 2020 Q2 2020 Q3 2020 Starting Starting Starting Starting Rent per Rent per Rent per Rent per SF SF(3) SF SF(3) SF SF(3) SF SF(3) Vancouver, Bri
Slide 46: Uncommenced Office Leases—Next Eight Quarters (Continued)
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Uncommenced Office Leases—Next Eight Quarters(1)(2) (Continued) Company’s Share Q3 2021 Q1 2022 Q3 2021 Q1 2022 Starting Starting Starting Starting Rent per Rent per Rent per Rent per SF SF(3) SF SF(3) SF SF(3) SF SF(3) Va
Slide 47: Backfilled Office Leases—Next Eight Quarters
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Backfilled Office Leases—Next Eight Quarters(1)(2) Company’s Share Q2 2020 Q3 2020 Q4 2020 Q2 2020 Q3 2020 Q4 2020 Starting Starting Starting Starting Starting Starting Rent per Rent per Rent per Rent per Rent per Rent per
Slide 48: Backfilled Office Leases—Next Eight Quarters
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Backfilled Office Leases—Next Eight Quarters(1)(2) Company’s Share Q3 2021 Q1 2022 Q3 2021 Q1 2022 Starting Starting Starting Starting Rent per Rent per Rent per Rent per SF SF(3) SF SF(3) SF SF(3) SF SF(3) Vancouver, Brit
Slide 49: Expiring Office Leases—Next Eight Quarters
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Expiring Office Leases—Next Eight Quarters(1) Company’s Share (2) (3) Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Expiring Rent/ Expiring Rent/ Expiring Rent/ Expiring Rent/ Expiring Rent/ Expiring Rent
Slide 50: Expiring Office Leases—Next Eight Quarters (continued)
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Expiring Office Leases—Next Eight Quarters(1)(continued) Company’s Share Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Expiring Rent/ Expiring Rent/ Expiring Rent/ Expiring Rent/ Expiring Rent/ Expiring R
Slide 51: Expiring Office Leases—Next Eight Quarters (continued)
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Expiring Office Leases—Next Eight Quarters(1) (continued) (6) Expiring rental rates have been converted from CAD to USD using the foreign currency exchange rate as of March 31, 2020. (7) Total expiring square footage consi
Slide 52: Expiring Office Leases—Annual
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Expiring Office Leases—Annual Company’s Share Percentage Annualized Square Square Percent of of Office Annualized Base Rent Per Number of Footage of Footage of Office Portfolio Base Rent Annualized Lease Square Leases Expi
Slide 53: Definitions and Reconciliations
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Definitions and Reconciliations
Slide 54: Definitions
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Definitions Adjusted EBITDAre: Adjusted EBITDAre represents net income (loss) before interest, income taxes, depreciation and amortization, and before our share interest and depreciation from the unconsolidated real estate
Slide 55: Definitions (continued)
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Definitions (continued) Funds from Operations (“FFO”): Non-GAAP financial measure we believe is a useful supplemental measure of our performance. We calculate FFO in accordance with the White Paper on FFO approved by the B
Slide 56: Reconciliation of Net Income to Net Operating Income
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Reconciliation of Net Income to Net Operating Income Unaudited, in thousands Three Months Ended March 31, 2020 2019 Net income (loss) $ 13,949 $ (36,895) Adjustments: Loss from unconsolidated real estate entity 236 — Fee i
Slide 57: Reconciliation of Net Income to Company's Share of Net Operating Income
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Reconciliation of Net Income to Company’s Share of Net Operating Income Unaudited, in thousands Three Months Ended March 31, 2020 2019 Net income (loss) $ 13,949 $ (36,895) Adjustments: Loss from unconsolidated real estate
Slide 58: Reconciliation of Consolidated Debt, Net to Adjusted EBITDAre (Annualized)
Hudson Pacific Properties, Inc. Supplemental Information | First Quarter 2020 Reconciliation of Consolidated Debt, Net to Adjusted EBITDAre (Annualized) Unaudited, in thousands Three Months Ended Quarter To Date March 31, 2020 December 31, 2019 September 30, 2019 June 30, 2019 March 31, 2019 Net inc
Slide 59: Los Angeles | Silicon Valley | San Francisco | Seattle | Vancouver
Los Angeles | Silicon Valley | San Francisco | Seattle | Vancouver HudsonPacificProperties.com
Hudson Pacific Properties — Q1 2020 Earnings Presentation on 6ix