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Hudson Pacific Properties Reports Second Quarter 2025 Financial Results

鈥� 1.2 Million Sq Ft Leased in 1H25, including 558,000 Signed in 2Q 鈥�

鈥� $1.0 Billion of Liquidity at Quarter End 鈥�

鈥� $13.5 Million of Recurring G&A, 35% Improved Over Last Year 鈥�

鈥� Provides 3Q FFO Outlook and Updates Full-Year Assumptions 鈥�

LOS ANGELES--(BUSINESS WIRE)-- Hudson Pacific Properties, Inc. (NYSE: HPP) (the "Company," "Hudson Pacific," or "HPP"), a unique provider of end-to-end real estate solutions for dynamic tech and media tenants, today announced financial results for the second quarter 2025.

Victor Coleman, Hudson Pacific鈥檚 CEO and Chairman, commented, "We are energized that one of our key initiatives, leasing our high-quality west coast portfolio located in key primary markets, produced 1.2 million square feet of office leases signed in the first half of the year. We have a robust pipeline in excess of 2.0 million square feet, and significantly lower expirations going forward. Portfolio stabilization is close, which will enable us to begin to grow office occupancy as we move ahead.

"Importantly, we are continuing to benefit from the ongoing west coast focused investments into AI, as both new companies and industry leaders are adding office space in many of our core markets. Additionally, we are starting to experience positive traction in our studio business as total and stage leased percentages for in-service studios increased to 74.3% and 80.0%, respectively, excluding our studio development Sunset Glenoaks.

"With a capital structure that now provides $1.0 billion of liquidity, along with emerging growth drivers from AI and a media industry that is finally beginning to ramp production, we are poised to capture additional value and drive cash flow. We appreciate that this will take time, but we are confident in our team鈥檚 ability to strengthen Hudson Pacific鈥檚 position as a preeminent owner of west coast office and studio real estate."

Financial Results Compared to Second Quarter 2024

• Total revenue of $190.0 million compared to $218.0 million, primarily due to asset sales and lower office occupancy
• General and administrative expenses of $13.5 million (excluding $14.3 million of one-time expenses associated with the cancellation of non-cash compensation agreements) compared to $20.7 million
• Net loss attributable to common stockholders of $(83.1) million, or $(0.41) per diluted share, compared to net loss of $(47.0) million, or $(0.33) per diluted share, largely attributable to items affecting revenue, as well as accelerated depreciation resulting from Quixote lease terminations and disposal of obsolete fleet
• FFO, excluding specified items, of $8.0 million, or $0.04 per diluted share, compared to $24.5 million, or $0.17 per diluted share, mostly attributable to the items affecting revenue. Specified items consisted of the one-time cancellation of non-cash compensation agreements of $14.3 million, or $0.07 per diluted share; one-time expenses associated with early debt repayment of $3.2 million, or $0.02 per diluted share; one-time Quixote cost-cutting expenses of $1.2 million, or $0.01 per diluted share; and transaction-related expenses of $0.5 million, or $0.00 per diluted share. Specified items for the second quarter of 2024 consisted of transaction-related income of $0.1 million, or $0.00 per diluted share; and a one-time derivative fair value adjustment of $1.3 million, or $0.01 per diluted share
• FFO of $(11.2) million, or $(0.05) per diluted share, compared to $23.3 million, or $0.16 per diluted share
• AFFO of $(6.1) million, or $(0.03) per diluted share, compared to $24.2 million, or $0.17 per diluted share, primarily the result of items affecting FFO along with increased recurring capital expenditures
• Same-store cash NOI of $87.1 million, compared to $104.1 million, primarily due to lower office occupancy

Leasing

• Executed 72 new and renewal leases totaling 558,055 square feet, including:
  • 77,000-square-foot renewal lease with a cybersecurity company at Metro Center with a 6-year term
  • 65,000-square-foot new lease with a mining company at Bentall Centre with an approximately 4-year term
  • 41,000-square-foot renewal and expansion lease with a digital sports company at 11601 Wilshire with an approximately 9-year term
  • 36,000-square-foot new lease with a gaming company at Bentall Centre with an approximately 13-year term
  • 32,000-square-foot new lease with a bio-tech company at Page Mill Hill with an approximately 6-year term
• GAAP and cash rents increased 4.9% and decreased 1.8%, respectively, from prior levels
• In-service office portfolio ended the quarter at 75.1% occupied and 76.2% leased, compared to 75.1% occupied and 76.5% leased in the first quarter this year
• In-service studio portfolio and stages were 63.0% and 63.6% leased, respectively, over the trailing 12-months, compared to 73.8% and 78.7% for the same metrics as of the first quarter this year. Excluding studio development Sunset Glenoaks (which contributed to the in-service trailing 12-month results for the first time this quarter), total and stage leased percentages would have increased to 74.3% and 80.0%, respectively

Transactions

• Sold office property 625 Second in San Francisco for $28.0 million before prorations and closing costs, with net proceeds used to repay amounts outstanding on the unsecured revolving credit facility

Balance Sheet as of June 30, 2025

• Repaid all private placement notes (Series B, C, and D) totaling $465.0 million, addressing significant maturities in 2025, 2026 and 2027
• Raised $690.0 million of gross proceeds through a common equity offering with net proceeds used to fully repay the unsecured revolving credit facility and for general corporate purposes
• Secured commitments to increase capacity under the unsecured revolving credit facility by $20.0 million to $795.0 million through December 2026 (including extensions), and to extend $462.0 million of capacity through December 2029 (including extensions)
• $1.0 billion of total liquidity comprised of $236.0 million of unrestricted cash and cash equivalents and $775.0 million of undrawn capacity under the unsecured revolving credit facility
• $87.4 million, or $22.3 million at HPP's share, of undrawn capacity under the construction loan secured by Sunset Pier 94 Studios
• HPP's share of net debt to HPP's share of undepreciated book value was 31.3% with 99.2% of debt fixed or capped with weighted average interest rate of 5.0% and no maturities until December 2025

Dividend

• The Company's Board of Directors declared and paid a dividend on its 4.750% Series C cumulative preferred stock of $0.296875 per share

2025 Outlook

Hudson Pacific is providing an FFO outlook for the third quarter of $0.01 to $0.05 per diluted share along with updated full-year assumptions (see table below). There are no specified items in connection with this outlook. Third quarter FFO outlook assumes fully diluted weighted average common stock/units of approximately 456.75 million.

This outlook reflects management鈥檚 view of current and future market conditions, including assumptions with respect to rental rates, occupancy levels and the earnings impact of events referenced in this press release and in earlier announcements. This outlook otherwise excludes any impact from new acquisitions, dispositions, debt financings, amendments or repayments, recapitalizations, capital markets activity or similar matters. There can be no assurance that actual results will not differ materially from these estimates.

Below are some of the assumptions the Company used in providing this outlook:

The Company does not provide a reconciliation for non-GAAP estimates on a forward-looking basis, where it is unable to provide a meaningful or accurate calculation or estimation of reconciling items and the information is not available without unreasonable effort. This is due to the inherent difficulty of forecasting the timing and/or amount of various items that would impact net income attributable to common stockholders per diluted share, which is the most directly comparable forward-looking GAAP financial measure. This includes, for example, acquisition costs and other non-core items that have not yet occurred, are out of the Company's control and/or cannot be reasonably predicted. For the same reasons, the Company is unable to address the probable significance of the unavailable information. Forward-looking non-GAAP financial measures provided without the most directly comparable GAAP financial measures may vary materially from the corresponding GAAP financial measures.

Supplemental Information

Supplemental financial information regarding Hudson Pacific's second quarter 2025 results may be found on the Investors section of the Company's website at . This supplemental information provides additional detail on items such as property occupancy, financial performance by property and debt maturity schedules.

Conference Call

The Company will hold a conference call to discuss second quarter 2025 financial results at 2:00 p.m. PT / 5:00 p.m. ET on August 5, 2025. The conference call will be available via live audio webcast on the Investors section of the Company's website at . A replay of the audio webcast will also be available following the call.

About Hudson Pacific Properties

Hudson Pacific Properties (NYSE: HPP) is a real estate investment trust serving dynamic tech and media tenants in global epicenters for these synergistic, converging and secular growth industries. Hudson Pacific鈥檚 unique and high-barrier tech and media focus leverages a full-service, end-to-end value creation platform forged through deep strategic relationships and niche expertise across identifying, acquiring, transforming and developing properties into world-class amenitized, collaborative and sustainable office and studio space. For more information visit .

Forward-Looking Statements

This press release may contain forward-looking statements within the meaning of the federal securities laws. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. In some cases, you can identify forward-looking statements by the use of forward-looking terminology such as "may," "will," "should," "expects," "intends," "plans," "anticipates," "believes," "estimates," "predicts," or "potential" or the negative of these words and phrases or similar words or phrases that are predictions of or indicate future events, or trends and that do not relate solely to historical matters. Forward-looking statements involve known and unknown risks, uncertainties, assumptions and contingencies, many of which are beyond the Company's control, which may cause actual results to differ significantly from those expressed in any forward-looking statement. All forward-looking statements reflect the Company's good faith beliefs, assumptions and expectations, but they are not guarantees of future performance. Furthermore, the Company disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes. For a further discussion of these and other factors that could cause the Company's future results to differ materially from any forward-looking statements, see the section entitled "Risk Factors" in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission, or SEC, and other risks described in documents subsequently filed by the Company from time to time with the SEC.

(FINANCIAL TABLES FOLLOW)

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Investor Contact

Laura Campbell

Executive Vice President, Investor Relations & Marketing

(310) 622-1702

[email protected]

Media Contact

Laura Murray

Vice President, Communications

(310) 622-1781

[email protected]

Source: Hudson Pacific Properties, Inc.