Howard Hughes Holdings Inc. · NYSE:HHH
Howard Hughes — Q1 2023 Earnings Presentation
33 slides from Howard Hughes's earnings presentation, May 8, 2023
Slide 1: Supplemental Information Three Months Ended March 31, 2023
The Howard Hughes Corporation Supplemental Information Three Months Ended March 31, 2023 NYSE: HHC Exhibit 99.2
Slide 2: Cautionary Statements
HOWARD HUGHES 2 Cautionary StatementsCautionary 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
Slide 3: Table of Contents
3 Table of Contents Table of Contents FINANCIAL OVERVIEW Definitions 4 Company Profile 5 Financial Summary 7 Balance Sheets 9 Statements of Operations 10 OPERATING PORTFOLIO PERFORMANCE Same Store Metrics 11 NOI by Region 13 Stabilized Properties 15 Unstabilized Properties 17 Under Construction Prop
Slide 4: Definitions
HOWARD HUGHES 4 Stabilized - Properties in the Operating Assets and Seaport segments that have been in service for more than 36 months or have reached 90% occupancy, whichever occurs first. If an office, retail or multi-family property has been in service for more than 36 months but does not exceed
Slide 5: Company Profile - Summary & Results
HOWARD HUGHES 5 The Park Ward Village 8% ‘A‘ali‘i 10% Kō'ula 2% Ulana Ward Village 25% Kalae 55% Bridgeland 49% Summerlin 45% The Woodlands/ Woodlands Hills 6% Recent Company Highlights Q1 2023 Company Performance Share Price - March 31, 2023 $ 80.00 Diluted Earnings / Share $ (0.46) FFO / Diluted S
Slide 6: Path to Projected Annual Stabilized NOI
HOWARD HUGHES 6 Office 36% Multi-family 51% Retail 13% Office 24% Multi-family 50% Retail 26% Office 49% Multi-family 24% Retail 20% Other 7% Office 51% Multi-family 20% Retail 21% Other 8% Office 36% Multi-family 54% Retail 10% Q1 2023 Path to Projected Annual Stabilized NOI Currently Under Constru
Slide 7: Company Profile
HOWARD HUGHES 7 thousands except share price and billions Q1 2023 Q4 2022 Q3 2022 Q2 2022 Q1 2022 Company Profile Share price (a) $ 80.00 $ 76.42 $ 55.39 $ 68.05 $ 103.61 Market Capitalization (b) $4.0b $3.8b $2.7b $3.5b $5.4b Enterprise Value (c) $8.4b $8.0b $7.1b $7.7b $9.4b Weighted avg. shares -
Slide 8: Financial Summary
HOWARD HUGHES 8 Financial Summary (a) Company's share of NOI for the Tin Building by Jean-Georges has been updated for the first and second quarters of 2022 using our current partnership funding provisions compared to the stated ownership of 65% used previously. (b) Excludes $2.7 million charge in t
Slide 9: Balance Sheets
HOWARD HUGHES 9 thousands except par values and share amounts (unaudited) March 31, 2023 December 31, 2022 ASSETS Master Planned Communities assets $ 2,418,631 $ 2,411,526 Buildings and equipment 4,368,919 4,246,389 Less: accumulated depreciation (912,636) (867,700) Land 310,685 312,230 Developments
Slide 10: Statements of Operations
HOWARD HUGHES 10 thousands except per share amounts (unaudited) Q1 2023 Q1 2022 REVENUES Condominium rights and unit sales $ 6,087 $ 19,616 Master Planned Communities land sales 59,361 61,468 Rental revenue 97,864 95,109 Other land, rental, and property revenues 18,968 19,537 Builder price participa
Slide 11: Same Store NOI
HOWARD HUGHES 11 thousands YTD Q1 2023 YTD Q1 2022 $ Change % Change Same Store Office Houston, TX $ 18,554 $ 16,075 $ 2,479 15 % Columbia, MD 6,177 5,805 372 6 % Las Vegas, NV 3,244 3,297 (53) (2) % Total Same Store Office 27,975 25,177 2,798 11 % Same Store Retail Houston, TX 3,395 1,774 1,621 91
Slide 12: Same Store Performance - Operating Assets Segment
HOWARD HUGHES 12 thousands Q1 2023 Q4 2022 Q3 2022 Q2 2022 Q1 2022 Same Store Metrics Stabilized Leasing Percentages Office 86 % 85 % 89 % 88 % 90 % Retail 96 % 95 % 96 % 95 % 93 % Multi-Family 95 % 95 % 96 % 96 % 98 % Unstabilized Leasing Percentages (a) Office — % — % 71 % 64 % 52 % Retail — % — %
Slide 13: NOI by Region - Stabilized Properties
HOWARD HUGHES 13 thousands except Sq. Ft. and units % Ownership (a) Total Q1 2023 Occupied (#) Q1 2023 Leased (#) Q1 2023 Occupied (%) Q1 2023 Leased (%) In-Place NOI Stabilized NOI Time to Stabilize (Years) (b)Sq. Ft. Units Sq. Ft. Units Sq. Ft. Units Sq. Ft. Units Sq. Ft. Units Stabilized Properti
Slide 14: NOI by Region, excluding Seaport (cont.)
HOWARD HUGHES 14 NOI by RegionNOI by Region, excluding Seaport (cont.) (a) Includes our share of NOI from our unconsolidated ventures. (b) The expected stabilization date used in the Time to Stabilize calculation for all unstabilized and under construction assets is set 36 months from the in-service
Slide 15: Stabilized Properties
HOWARD HUGHES 15 thousands except Sq. Ft. and units Location % Ownership Rentable Sq. Ft. Q1 2023 % Occ. (a) Q1 2023 % Leased (a) In-Place NOI (b) Est. Stabilized NOI (b) Office One Hughes Landing Houston, TX 100 % 200,639 55 % 55 % $ 2,190 $ 6,170 Two Hughes Landing Houston, TX 100 % 197,950 79 % 8
Slide 16: Stabilized Properties - Multi-family
HOWARD HUGHES 16 Q1 2023 % Occ.(a) Q1 2023 % Leased (a) thousands except Sq. Ft. and units Location % Ownership Rentable Sq. Ft. Units Rentable Sq. Ft. Units Rentable Sq. Ft. Units In-Place NOI (b) Est. Stabilized NOI (b) Multi-family Creekside Park Apartments Houston, TX 100 % — 292 n/a 93 % n/a 94
Slide 17: Unstabilized Properties
HOWARD HUGHES 17 Q1 2023 % Occ. (a) Q1 2023 % Leased (a) Dev. Costs Incurred to Date Total Estimated Dev. Costs In-Place NOI Est. Stabilized NOI (b) Est. Stab. Date Est. Stab. Yield thousands except Sq. Ft. and units Location % Ownership Rentable Sq. Ft. Units Rentable Sq. Ft. Units Rentable Sq. Ft.
Slide 18: Under Construction Properties
HOWARD HUGHES 18 Under Construction Properties thousands except Sq. Ft. and units Location % Ownership Est. Rentable Sq. Ft. Percent Pre- Leased (a) Const. Start Date Est. Stabilized Date (b) Dev. Costs Incurred to Date Total Estimated Development Costs Est. Stabilized NOI Est. Stab. Yield Office So
Slide 19: Seaport Operating Performance
HOWARD HUGHES 19 NOI by Region Q1 2023 Landlord Operations (a) Landlord Operations - Multi-family (b) Managed Businesses (c) Tin Building (d) Events and Sponsorships (e) Q1 2023 Totalthousands except sq. ft. and percentages Revenues (f) $ 2,285 $ 342 $ 5,222 $ 2,818 $ 1,230 $ 11,897 Operating expens
Slide 20: Ward Village - Sold Out Condominiums
HOWARD HUGHES 20 As of March 31, 2023 Waiea Anaha Ae‘o Ke Kilohana Victoria Place Total Key Metrics ($ in thousands) Type of building Luxury Luxury Upscale Workforce Luxury Number of units 177 317 465 423 349 1,731 Avg. unit Sq. Ft. 2,138 1,417 838 696 1,164 1,108 Condo Sq. Ft. 378,488 449,205 389,6
Slide 21: Ward Village - Remaining to be Sold
HOWARD HUGHES 21 As of March 31, 2023 ‘A‘ali‘i Kō'ula The Park Ward Village Ulana Ward Village Kalae Total Key Metrics ($ in thousands) Type of building Upscale Upscale Upscale Workforce Luxury Number of units 750 565 545 696 329 2,885 Avg. unit Sq. Ft. 520 725 846 623 1,207 725 Condo Sq. Ft. 390,09
Slide 22: Summary of Remaining Development Costs
HOWARD HUGHES 22 As of March 31, 2023 thousands Location Total Estimated Development Costs (a) Development Costs Incurred to Date Estimated Remaining to be Spent Remaining Buyer Deposits/ Holdback to be Drawn Debt to be Drawn Costs Remaining to be Paid, Net of Debt and Buyer Deposits/ Holdbacks to b
Slide 23: Portfolio Key Metrics
HOWARD HUGHES 23 MPC Regions Non-MPC Regions The Woodlands The Woodlands Hills Bridgeland Summerlin Teravalis Floreo Total Columbia (a) Hawai‘i Seaport Total As of March 31, 2023 Houston, TX Houston, TX Houston, TX Las Vegas, NV Phoenix, AZ Phoenix, AZ MPC Regions Columbia, MD Honolulu, HI New York,
Slide 24: MPC Performance
HOWARD HUGHES 24 Master Planned Community Land Consolidated MPC Segment EBT The Woodlands The Woodlands Hills Bridgeland Summerlin Teravalis Columbia (a) Total Floreo (b) thousands Q1 2023 Q1 2022 Q1 2023 Q1 2022 Q1 2023 Q1 2022 Q1 2023 Q1 2022 Q1 2023 Q1 2022 Q1 2023 Q1 2022 Q1 2023 Q1 2022 Q1 2023
Slide 25: MPC Land
HOWARD HUGHES 25 Master Planned Community Land Consolidated MPC Segment The Woodlands The Woodlands Hills Bridgeland Summerlin Teravalis Floreo (a) thousands Q1 2023 Q1 2022 Q1 2023 Q1 2022 Q1 2023 Q1 2022 Q1 2023 Q1 2022 Q1 2023 Q1 2022 Q1 2023 Q1 2022 Key Performance Metrics: Residential Total acr
Slide 26: Lease Expirations
HOWARD HUGHES 26 Office Expirations (a) Retail Expirations (a) Expiration Year Annualized Cash Rent ($ in thousands) Percentage of Annualized Cash Rent Wtd. Avg. Annualized Cash Rent Per Leased Sq. Ft. Annualized Cash Rent ($ in thousands) Percentage of Annualized Cash Rent Wtd. Avg. Annualized Cash
Slide 27: Acquisition / Disposition Activity
HOWARD HUGHES 27 Acquisition / Disposition Activity thousands except rentable Sq. Ft. / Units / Acres Q1 2023 Acquisitions Date Acquired Property % Ownership Location Acres / Rentable Sq. Ft. Acquisition Price No acquisition activity in Q1 2023 Q1 2023 Dispositions Date Sold Property % Ownership Loc
Slide 28: Other Assets
HOWARD HUGHES 28 Other Assets Property Name Location % Ownership Acres Notes West End Alexandria (formerly Landmark Mall) Alexandria, VA 58% 41.1 West End Alexandria is a joint venture formed to redevelop the former Landmark Mall into four million square feet of residential, retail, commercial, and
Slide 29: Debt Summary
HOWARD HUGHES 29 thousands March 31, 2023 December 31, 2022 Fixed-rate debt Unsecured 5.375% Senior Notes due 2028 $ 750,000 $ 750,000 Unsecured 4.125% Senior Notes due 2029 650,000 650,000 Unsecured 4.375% Senior Notes due 2031 650,000 650,000 Secured mortgages payable 1,498,444 1,500,841 Special I
Slide 30: Debt Summary (cont.)
HOWARD HUGHES 30 (a) Includes the impact of interest rate derivatives. The Company's interest rate swap with a notional amount of $615 million matures in September 2023. (b) Does not include extension options, some of which have performance requirements. (c) Represents Secured Bridgeland Notes with
Slide 31: Reconciliation of Operating Assets segment EBT to Total NOI
HOWARD HUGHES 31 Reconciliation of Operating Assets segment EBT to Total NOI thousands Q1 2023 Q4 2022 Q3 2022 Q2 2022 Q1 2022 Total revenues $ 100,925 $ 104,092 $ 109,493 $ 118,562 $ 99,687 Total operating expenses (47,599) (47,538) (48,994) (51,349) (46,615) Segment operating income (loss) 53,326
Slide 32: Reconciliation of Seaport segment EBT to Total NOI
HOWARD HUGHES 32 Reconciliation of Non-GAAP Measures Reconciliation of Seaport segment EBT to Total NOI thousands Q1 2023 Q4 2022 Q3 2022 Q2 2022 Q1 2022 Total revenues $ 11,897 $ 18,415 $ 32,501 $ 28,176 $ 9,376 Total operating expenses (18,916) (25,064) (31,404) (29,066) (18,859) Segment operating
Slide 33: Reconciliations of Net Income to FFO
HOWARD HUGHES 33 RECONCILIATIONS OF NET INCOME TO FFO thousands except share amounts YTD Q1 2023 YTD Q1 2022 Net income attributable to common shareholders $ (22,745) $ 2,122 Adjustments to arrive at FFO: Segment real estate related depreciation and amortization 51,209 47,675 (Gain) loss on sale or