QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Hudson Pacific Properties, Inc. | Maryland (State or other jurisdiction of incorporation or organization) | 27-1430478 (I.R.S. Employer Identification Number) | ||||||
Hudson Pacific Properties, L.P. | Maryland (State or other jurisdiction of incorporation or organization) | 80-0579682 (I.R.S. Employer Identification Number) |
11601 Wilshire Blvd., Ninth Floor Los Angeles, California 90025 | ||
(Address of principal executive offices) (Zip Code) |
Registrant | Title of each class | Trading Symbol(s) | Name of each exchange on which registered | |||||||||||||||||
Hudson Pacific Properties, Inc. | Common Stock, $0.01 par value | HPP | New York Stock Exchange |
Hudson Pacific Properties, Inc. Yes x No o | Hudson Pacific Properties, L.P. Yes x No o |
Hudson Pacific Properties, Inc. Yes x No o | Hudson Pacific Properties, L.P. Yes x No o |
Large accelerated filer x | Accelerated filer o | ||||||||
Non-accelerated filer o | |||||||||
Smaller reporting company | |||||||||
Emerging growth company |
Large accelerated filer o | Accelerated filer o | ||||||||
Non-accelerated filer x | |||||||||
Smaller reporting company | |||||||||
Emerging growth company |
Hudson Pacific Properties, Inc. o | Hudson Pacific Properties, L.P. o |
Hudson Pacific Properties, Inc. Yes | Hudson Pacific Properties, L.P. Yes |
Page | ||||||||||||||
ITEM 1. | Financial Statements of Hudson Pacific Properties, Inc. | |||||||||||||
ITEM 1. | Financial Statements of Hudson Pacific Properties, L.P. | |||||||||||||
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June 30, 2018 (unaudited) | December 31, 2017 | June 30, 2019 (unaudited) | December 31, 2018 | |||||||||||||||
ASSETS | ASSETS | |||||||||||||||||
Investment in real estate, at cost | $ | 6,418,882 | $ | 6,219,361 | Investment in real estate, at cost | $ | 7,088,508 | $ | 7,059,537 | |||||||||
Accumulated depreciation and amortization | (601,535 | ) | (521,370 | ) | Accumulated depreciation and amortization | (792,485) | (695,631) | |||||||||||
Investment in real estate, net | 5,817,347 | 5,697,991 | Investment in real estate, net | 6,296,023 | 6,363,906 | |||||||||||||
Cash and cash equivalents | 57,515 | 78,922 | Cash and cash equivalents | 48,172 | 53,740 | |||||||||||||
Restricted cash | 8,472 | 22,358 | Restricted cash | 13,375 | 14,451 | |||||||||||||
Accounts receivable, net | 6,615 | 4,234 | Accounts receivable, net | 13,805 | 14,004 | |||||||||||||
Straight-line rent receivables, net | 124,083 | 106,466 | Straight-line rent receivables, net | 170,928 | 142,369 | |||||||||||||
Deferred leasing costs and lease intangible assets, net | 236,582 | 239,029 | Deferred leasing costs and lease intangible assets, net | 299,250 | 279,896 | |||||||||||||
U.S. Government securities | U.S. Government securities | 142,761 | 146,880 | |||||||||||||||
Operating lease right-of-use asset | Operating lease right-of-use asset | 270,943 | — | |||||||||||||||
Prepaid expenses and other assets, net | 107,549 | 61,139 | Prepaid expenses and other assets, net | 66,074 | 55,633 | |||||||||||||
Investment in unconsolidated real estate entity | Investment in unconsolidated real estate entity | 65,495 | — | |||||||||||||||
Assets associated with real estate held for sale | 201,011 | 411,931 | Assets associated with real estate held for sale | 99,840 | — | |||||||||||||
TOTAL ASSETS | $ | 6,559,174 | $ | 6,622,070 | TOTAL ASSETS | $ | 7,486,666 | $ | 7,070,879 | |||||||||
LIABILITIES AND EQUITY | LIABILITIES AND EQUITY | |||||||||||||||||
Notes payable, net | $ | 2,361,749 | $ | 2,421,380 | ||||||||||||||
Accounts payable and accrued liabilities | 151,697 | 162,081 | ||||||||||||||||
Liabilities | Liabilities | |||||||||||||||||
Unsecured and secured debt, net | Unsecured and secured debt, net | $ | 2,834,785 | $ | 2,623,835 | |||||||||||||
In-substance defeased debt | In-substance defeased debt | 136,636 | 138,223 | |||||||||||||||
Joint venture partner debt | Joint venture partner debt | 66,136 | 66,136 | |||||||||||||||
Accounts payable, accrued liabilities and other | Accounts payable, accrued liabilities and other | 241,990 | 175,300 | |||||||||||||||
Operating lease liability | Operating lease liability | 273,883 | — | |||||||||||||||
Lease intangible liabilities, net | 41,729 | 49,540 | Lease intangible liabilities, net | 37,833 | 45,612 | |||||||||||||
Security deposits and prepaid rent | 64,582 | 62,760 | Security deposits and prepaid rent | 61,788 | 68,687 | |||||||||||||
Derivative liabilities | — | 265 | ||||||||||||||||
Liabilities associated with real estate held for sale | 3,554 | 4,903 | Liabilities associated with real estate held for sale | 104 | — | |||||||||||||
TOTAL LIABILITIES | 2,623,311 | 2,700,929 | ||||||||||||||||
Redeemable non-controlling interest | 9,815 | 10,177 | ||||||||||||||||
EQUITY | ||||||||||||||||||
Hudson Pacific Properties, Inc. stockholders’ equity: | ||||||||||||||||||
Common stock, $0.01 par value, 490,000,000 authorized, 155,647,733 shares and 155,602,508 shares outstanding at June 30, 2018 and December 31, 2017, respectively | 1,556 | 1,556 | ||||||||||||||||
Total liabilities | Total liabilities | 3,653,155 | 3,117,793 | |||||||||||||||
Redeemable preferred units of the operating partnership | Redeemable preferred units of the operating partnership | 9,815 | 9,815 | |||||||||||||||
Redeemable non-controlling interest in consolidated real estate entities | Redeemable non-controlling interest in consolidated real estate entities | 114,917 | 113,141 | |||||||||||||||
Equity | Equity | |||||||||||||||||
Hudson Pacific Properties, Inc. stockholders’ equity | Hudson Pacific Properties, Inc. stockholders’ equity | |||||||||||||||||
Common stock, $0.01 par value, 490,000,000 authorized, 154,396,755 shares and 154,371,538 shares outstanding at June 30, 2019 and December 31, 2018, respectively | Common stock, $0.01 par value, 490,000,000 authorized, 154,396,755 shares and 154,371,538 shares outstanding at June 30, 2019 and December 31, 2018, respectively | 1,543 | 1,543 | |||||||||||||||
Additional paid-in capital | 3,615,833 | 3,622,988 | Additional paid-in capital | 3,450,155 | 3,524,502 | |||||||||||||
Accumulated other comprehensive income | 26,407 | 13,227 | Accumulated other comprehensive income | 1,279 | 17,501 | |||||||||||||
Accumulated deficit | Accumulated deficit | (31,355) | — | |||||||||||||||
Total Hudson Pacific Properties, Inc. stockholders’ equity | 3,643,796 | 3,637,771 | Total Hudson Pacific Properties, Inc. stockholders’ equity | 3,421,622 | 3,543,546 | |||||||||||||
Non-controlling interest—members in consolidated entities | 265,695 | 258,602 | Non-controlling interest—members in consolidated entities | 268,158 | 268,246 | |||||||||||||
Non-controlling interest—units in the operating partnership | 16,557 | 14,591 | Non-controlling interest—units in the operating partnership | 18,999 | 18,338 | |||||||||||||
TOTAL EQUITY | 3,926,048 | 3,910,964 | ||||||||||||||||
Total equity | Total equity | 3,708,779 | 3,830,130 | |||||||||||||||
TOTAL LIABILITIES AND EQUITY | $ | 6,559,174 | $ | 6,622,070 | TOTAL LIABILITIES AND EQUITY | $ | 7,486,666 | $ | 7,070,879 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||||||||||||||||||||||
REVENUES | |||||||||||||||||||||||||||||||||||
Office | |||||||||||||||||||||||||||||||||||
Rental (Note 2) | $ | 172,256 | $ | 129,732 | $ | 342,453 | $ | 259,814 | |||||||||||||||||||||||||||
Tenant recoveries (Note 2) | — | 21,960 | — | 42,864 | |||||||||||||||||||||||||||||||
Service revenues (Note 2) | 6,791 | 6,858 | 12,452 | 12,404 | |||||||||||||||||||||||||||||||
Total office revenues | 179,047 | 158,550 | 354,905 | 315,082 | |||||||||||||||||||||||||||||||
Studio | |||||||||||||||||||||||||||||||||||
Rental (Note 2) | 14,521 | 10,708 | 26,915 | 21,091 | |||||||||||||||||||||||||||||||
Tenant recoveries (Note 2) | — | 500 | — | 854 | |||||||||||||||||||||||||||||||
Service revenues and other (Note 2) | 3,088 | 5,411 | 12,225 | 12,260 | |||||||||||||||||||||||||||||||
Total studio revenues | 17,609 | 16,619 | 39,140 | 34,205 | |||||||||||||||||||||||||||||||
Total revenues | 196,656 | 175,169 | 394,045 | 349,287 | |||||||||||||||||||||||||||||||
OPERATING EXPENSES | |||||||||||||||||||||||||||||||||||
Office operating expenses | 60,896 | 53,940 | 121,711 | 107,180 | |||||||||||||||||||||||||||||||
Studio operating expenses | 9,539 | 8,539 | 20,648 | 18,203 | |||||||||||||||||||||||||||||||
General and administrative | 18,344 | 16,203 | 36,438 | 31,767 | |||||||||||||||||||||||||||||||
Depreciation and amortization | 69,606 | 60,706 | 138,111 | 121,259 | |||||||||||||||||||||||||||||||
Total operating expenses | 158,385 | 139,388 | 316,908 | 278,409 | |||||||||||||||||||||||||||||||
OTHER (EXPENSE) INCOME | |||||||||||||||||||||||||||||||||||
Loss from unconsolidated real estate investments | (85) | — | (85) | — | |||||||||||||||||||||||||||||||
Interest expense | (26,552) | (19,331) | (50,902) | (39,834) | |||||||||||||||||||||||||||||||
Interest income | 1,008 | 66 | 2,032 | 75 | |||||||||||||||||||||||||||||||
Transaction-related expenses | — | — | (128) | (118) | |||||||||||||||||||||||||||||||
Other income | 181 | 319 | 75 | 723 | |||||||||||||||||||||||||||||||
Unrealized gain on non-real estate investment | — | 928 | — | 928 | |||||||||||||||||||||||||||||||
Gains on sale of real estate | — | 1,928 | — | 39,602 | |||||||||||||||||||||||||||||||
Impairment loss | — | — | (52,201) | — | |||||||||||||||||||||||||||||||
Total other (expense) income | (25,448) | (16,090) | (101,209) | 1,376 | |||||||||||||||||||||||||||||||
Net income (loss) | 12,823 | 19,691 | (24,072) | 72,254 | |||||||||||||||||||||||||||||||
Net income attributable to preferred units | (153) | (153) | (306) | (312) | |||||||||||||||||||||||||||||||
Net income attributable to participating securities | (48) | (110) | (356) | (437) | |||||||||||||||||||||||||||||||
Net income attributable to non-controlling interest in consolidated real estate entities | (3,317) | (3,167) | (6,138) | (6,490) | |||||||||||||||||||||||||||||||
Net loss attributable to redeemable non-controlling interest in consolidated real estate entities | 558 | — | 1,158 | — | |||||||||||||||||||||||||||||||
Net (income) loss attributable to non-controlling interest in the operating partnership | (77) | (59) | 108 | (236) | |||||||||||||||||||||||||||||||
NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS | $ | 9,786 | $ | 16,202 | $ | (29,606) | $ | 64,779 | |||||||||||||||||||||||||||
BASIC AND DILUTED PER SHARE AMOUNTS | |||||||||||||||||||||||||||||||||||
Net income (loss) attributable to common stockholders—basic | $ | 0.06 | $ | 0.10 | $ | (0.19) | $ | 0.42 | |||||||||||||||||||||||||||
Net income (loss) attributable to common stockholders—diluted | $ | 0.06 | $ | 0.10 | $ | (0.19) | $ | 0.41 | |||||||||||||||||||||||||||
Weighted average shares of common stock outstanding—basic | 154,384,586 | 155,636,636 | 154,390,340 | 155,631,375 | |||||||||||||||||||||||||||||||
Weighted average shares of common stock outstanding—diluted | 154,687,261 | 156,590,227 | 154,390,340 | 156,563,966 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
REVENUES | |||||||||||||||
Office | |||||||||||||||
Rental | $ | 129,732 | $ | 133,602 | $ | 259,814 | $ | 267,118 | |||||||
Tenant recoveries | 21,960 | 25,038 | 42,864 | 42,439 | |||||||||||
Parking and other | 6,858 | 8,212 | 12,404 | 14,111 | |||||||||||
Total Office revenues | 158,550 | 166,852 | 315,082 | 323,668 | |||||||||||
Studio | |||||||||||||||
Rental | 10,708 | 9,105 | 21,091 | 15,790 | |||||||||||
Tenant recoveries | 500 | 129 | 854 | 794 | |||||||||||
Other property-related revenue | 5,301 | 4,361 | 11,736 | 8,403 | |||||||||||
Other | 110 | 53 | 524 | 130 | |||||||||||
Total Studio revenues | 16,619 | 13,648 | 34,205 | 25,117 | |||||||||||
TOTAL REVENUES | 175,169 | 180,500 | 349,287 | 348,785 | |||||||||||
OPERATING EXPENSES | |||||||||||||||
Office operating expenses | 53,940 | 55,468 | 107,180 | 103,422 | |||||||||||
Studio operating expenses | 8,539 | 7,003 | 18,203 | 14,254 | |||||||||||
General and administrative | 16,203 | 14,506 | 31,767 | 28,316 | |||||||||||
Depreciation and amortization | 60,706 | 75,415 | 121,259 | 146,182 | |||||||||||
TOTAL OPERATING EXPENSES | 139,388 | 152,392 | 278,409 | 292,174 | |||||||||||
INCOME FROM OPERATIONS | 35,781 | 28,108 | 70,878 | 56,611 | |||||||||||
OTHER EXPENSE (INCOME) | |||||||||||||||
Interest expense | 19,331 | 21,695 | 39,834 | 43,625 | |||||||||||
Interest income | (66 | ) | (16 | ) | (75 | ) | (46 | ) | |||||||
Unrealized loss on ineffective portion of derivatives | — | 51 | — | 45 | |||||||||||
Unrealized gain on non-real estate investment | (928 | ) | — | (928 | ) | — | |||||||||
Transaction-related expenses | — | — | 118 | — | |||||||||||
Other income | (319 | ) | (576 | ) | (723 | ) | (1,254 | ) | |||||||
TOTAL OTHER EXPENSES | 18,018 | 21,154 | 38,226 | 42,370 | |||||||||||
INCOME BEFORE GAINS ON SALE OF REAL ESTATE | 17,763 | 6,954 | 32,652 | 14,241 | |||||||||||
Gains on sale of real estate | 1,928 | — | 39,602 | 16,866 | |||||||||||
NET INCOME | 19,691 | 6,954 | 72,254 | 31,107 | |||||||||||
Net income attributable to preferred units | (153 | ) | (159 | ) | (312 | ) | (318 | ) | |||||||
Net income attributable to participating securities | (110 | ) | (255 | ) | (437 | ) | (495 | ) | |||||||
Net income attributable to non-controlling interest in consolidated entities | (3,167 | ) | (2,974 | ) | (6,490 | ) | (6,011 | ) | |||||||
Net income attributable to non-controlling interest in the operating partnership | (59 | ) | (13 | ) | (236 | ) | (215 | ) | |||||||
Net income attributable to Hudson Pacific Properties, Inc. common stockholders | $ | 16,202 | $ | 3,553 | $ | 64,779 | $ | 24,068 | |||||||
Basic and diluted per share amounts: | |||||||||||||||
Net income attributable to common stockholders—basic | $ | 0.10 | $ | 0.02 | $ | 0.42 | $ | 0.16 | |||||||
Net income attributable to common stockholders—diluted | $ | 0.10 | $ | 0.02 | $ | 0.41 | $ | 0.16 | |||||||
Weighted average shares of common stock outstanding—basic | 155,636,636 | 155,290,559 | 155,631,375 | 151,640,853 | |||||||||||
Weighted average shares of common stock outstanding—diluted | 156,590,227 | 156,095,603 | 156,563,966 | 152,431,897 | |||||||||||
Dividends declared per share | $ | 0.25 | $ | 0.25 | $ | 0.50 | $ | 0.50 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||||||||||||||||||||||
Net income (loss) | $ | 12,823 | $ | 19,691 | $ | (24,072) | $ | 72,254 | |||||||||||||||||||||||||||
Currency translation adjustments | 1,315 | — | 1,315 | — | |||||||||||||||||||||||||||||||
Net unrealized (losses) gains on derivative instruments: | |||||||||||||||||||||||||||||||||||
Unrealized (losses) gains | (7,937) | 4,185 | (13,891) | 13,726 | |||||||||||||||||||||||||||||||
Reclassification adjustment for realized gains | (1,838) | (701) | (3,748) | (729) | |||||||||||||||||||||||||||||||
(9,775) | 3,484 | (17,639) | 12,997 | ||||||||||||||||||||||||||||||||
Total other comprehensive (loss) income | (8,460) | 3,484 | (16,324) | 12,997 | |||||||||||||||||||||||||||||||
Comprehensive income (loss) | 4,363 | 23,175 | (40,396) | 85,251 | |||||||||||||||||||||||||||||||
Comprehensive income attributable to preferred units | (153) | (153) | (306) | (312) | |||||||||||||||||||||||||||||||
Comprehensive income attributable to participating securities | (48) | (133) | (356) | (524) | |||||||||||||||||||||||||||||||
Comprehensive income attributable to non-controlling interest in consolidated real estate entities | (3,317) | (3,167) | (6,138) | (6,490) | |||||||||||||||||||||||||||||||
Comprehensive loss attributable to redeemable non-controlling interest in consolidated real estate entities | 558 | — | 1,158 | — | |||||||||||||||||||||||||||||||
Comprehensive (income) loss attributable to non-controlling interest in the operating partnership | (12) | (72) | 210 | (283) | |||||||||||||||||||||||||||||||
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS | $ | 1,391 | $ | 19,650 | $ | (45,828) | $ | 77,642 | |||||||||||||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Net income | $ | 19,691 | $ | 6,954 | $ | 72,254 | $ | 31,107 | |||||||
Other comprehensive income (loss): change in fair value of derivatives | 3,484 | (2,760 | ) | 12,997 | 104 | ||||||||||
Comprehensive income | 23,175 | 4,194 | 85,251 | 31,211 | |||||||||||
Comprehensive income attributable to preferred units | (153 | ) | (159 | ) | (312 | ) | (318 | ) | |||||||
Comprehensive income attributable to participating securities | (133 | ) | (255 | ) | (524 | ) | (495 | ) | |||||||
Comprehensive income attributable to non-controlling interest in consolidated entities | (3,167 | ) | (2,974 | ) | (6,490 | ) | (6,011 | ) | |||||||
Comprehensive income attributable to non-controlling interest in the operating partnership | (72 | ) | (3 | ) | (283 | ) | (233 | ) | |||||||
Comprehensive income attributable to Hudson Pacific Properties, Inc. common stockholders | $ | 19,650 | $ | 803 | $ | 77,642 | $ | 24,154 |
Hudson Pacific Properties, Inc. Stockholders’ Equity | Non-controlling interest | |||||||||||||||||||||||||||||||||||||||||||
Shares of Common Stock | Stock Amount | Additional Paid-in Capital | Retained Earnings (Accumulated Deficit) | Accumulated Other Comprehensive Income | Units in the Operating Partnership | Members in Consolidated Entities | Total Equity | |||||||||||||||||||||||||||||||||||||
Balance at March 31, 2018 | 155,626,055 | $ | 1,556 | $ | 3,625,673 | $ | 9,500 | $ | 22,936 | $ | 15,644 | $ | 263,556 | $ | 3,938,865 | |||||||||||||||||||||||||||||
Distributions | — | — | — | — | — | — | (1,028) | (1,028) | ||||||||||||||||||||||||||||||||||||
Proceeds from sale of common stock, net of underwriters’ discount and transaction costs | — | — | (34) | — | — | — | — | (34) | ||||||||||||||||||||||||||||||||||||
Issuance of unrestricted stock | 21,678 | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Declared dividend | — | — | (13,364) | (25,812) | — | (178) | — | (39,354) | ||||||||||||||||||||||||||||||||||||
Amortization of stock-based compensation | — | — | 3,558 | — | — | 1,019 | — | 4,577 | ||||||||||||||||||||||||||||||||||||
Net income | — | — | — | 16,312 | — | 59 | 3,167 | 19,538 | ||||||||||||||||||||||||||||||||||||
Other comprehensive gain | — | — | — | — | 3,471 | 13 | — | 3,484 | ||||||||||||||||||||||||||||||||||||
Balance, June 30, 2018 | 155,647,733 | $ | 1,556 | $ | 3,615,833 | $ | — | $ | 26,407 | $ | 16,557 | $ | 265,695 | $ | 3,926,048 | |||||||||||||||||||||||||||||
Balance at December 31, 2017 | 155,602,508 | $ | 1,556 | $ | 3,622,988 | $ | — | $ | 13,227 | $ | 14,591 | $ | 258,602 | $ | 3,910,964 | |||||||||||||||||||||||||||||
Cumulative adjustment related to adoption of ASU 2017-12 | — | — | — | (231) | 230 | 1 | — | — | ||||||||||||||||||||||||||||||||||||
Contributions | — | — | — | — | — | — | 2,691 | 2,691 | ||||||||||||||||||||||||||||||||||||
Distributions | — | — | — | — | — | — | (2,088) | (2,088) | ||||||||||||||||||||||||||||||||||||
Proceeds from sale of common stock, net of underwriters’ discount and transaction costs | — | — | (207) | — | — | — | — | (207) | ||||||||||||||||||||||||||||||||||||
Issuance of unrestricted stock | 65,578 | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Shares withheld to satisfy tax withholding | (20,353) | — | (693) | — | — | — | — | (693) | ||||||||||||||||||||||||||||||||||||
Declared dividend | — | — | (13,364) | (64,985) | — | (356) | — | (78,705) | ||||||||||||||||||||||||||||||||||||
Amortization of stock-based compensation | — | — | 7,109 | — | — | 2,038 | — | 9,147 | ||||||||||||||||||||||||||||||||||||
Net income | — | — | — | 65,216 | — | 236 | 6,490 | 71,942 | ||||||||||||||||||||||||||||||||||||
Other comprehensive gain | — | — | — | — | 12,950 | 47 | — | 12,997 | ||||||||||||||||||||||||||||||||||||
Balance at June 30, 2018 | 155,647,733 | $ | 1,556 | $ | 3,615,833 | $ | — | $ | 26,407 | $ | 16,557 | $ | 265,695 | $ | 3,926,048 |
Hudson Pacific Properties, Inc. Stockholders’ Equity | |||||||||||||||||||||||
Shares of Common Stock | Stock Amount | Additional Paid-in Capital | Retained Earnings (Accumulated Deficit) | Accumulated Other Comprehensive Income | Non- controlling Interest—Units in the Operating Partnership | Non-controlling Interest—Members in Consolidated Entities | Total Equity | ||||||||||||||||
Balance at January 1, 2017 | 136,492,235 | $ | 1,364 | $ | 3,109,394 | $ | (16,971 | ) | $ | 9,496 | $ | 294,859 | $ | 304,608 | $ | 3,702,750 | |||||||
Contributions | — | — | — | — | — | — | 3,870 | 3,870 | |||||||||||||||
Distributions | — | — | — | — | — | — | (74,836 | ) | (74,836 | ) | |||||||||||||
Proceeds from sale of common stock, net of underwriters’ discount and transaction costs | 18,656,575 | 187 | 647,195 | — | — | — | — | 647,382 | |||||||||||||||
Issuance of unrestricted stock | 917,086 | 9 | (9 | ) | — | — | — | — | — | ||||||||||||||
Shares withheld to satisfy tax withholding | (463,388 | ) | (4 | ) | (16,037 | ) | — | — | — | — | (16,041 | ) | |||||||||||
Declared dividend | — | — | (106,269 | ) | (51,619 | ) | — | (656 | ) | — | (158,544 | ) | |||||||||||
Amortization of stock-based compensation | — | — | 13,249 | — | — | 2,666 | — | 15,915 | |||||||||||||||
Net income | — | — | — | 68,590 | — | 375 | 24,960 | 93,925 | |||||||||||||||
Change in fair value of derivatives | — | — | — | — | 7,353 | 45 | — | 7,398 | |||||||||||||||
Redemption of common units in the operating partnership | — | — | (24,535 | ) | — | (3,622 | ) | (282,698 | ) | — | (310,855 | ) | |||||||||||
Balance at December 31, 2017 | 155,602,508 | 1,556 | 3,622,988 | — | 13,227 | 14,591 | 258,602 | 3,910,964 | |||||||||||||||
Cumulative adjustment related to adoption of ASU 2017-12 | — | — | — | (231 | ) | 230 | 1 | — | — | ||||||||||||||
Contributions | — | — | — | — | — | — | 2,691 | 2,691 | |||||||||||||||
Distributions | — | — | — | — | — | — | (2,088 | ) | (2,088 | ) | |||||||||||||
Proceeds from sale of common stock, net of underwriters’ discount and transaction costs | — | — | (207 | ) | — | — | — | — | (207 | ) | |||||||||||||
Issuance of unrestricted stock | 65,578 | — | — | — | — | — | — | — | |||||||||||||||
Shares withheld to satisfy tax withholding | (20,353 | ) | — | (693 | ) | — | — | — | — | (693 | ) | ||||||||||||
Declared dividend | — | — | (13,364 | ) | (64,985 | ) | — | (356 | ) | — | (78,705 | ) | |||||||||||
Amortization of stock-based compensation | — | — | 7,109 | — | — | 2,038 | — | 9,147 | |||||||||||||||
Net income | — | — | — | 65,216 | — | 236 | 6,490 | 71,942 | |||||||||||||||
Change in fair value of derivatives | — | — | — | — | 12,950 | 47 | — | 12,997 | |||||||||||||||
Balance at June 30, 2018 | 155,647,733 | $ | 1,556 | $ | 3,615,833 | $ | — | $ | 26,407 | $ | 16,557 | $ | 265,695 | $ | 3,926,048 |
Hudson Pacific Properties, Inc. Stockholders’ Equity | Non-controlling interest | |||||||||||||||||||||||||||||||||||||||||||
Shares of Common Stock | Stock Amount | Additional Paid-in Capital | (Accumulated Deficit) Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Units in the Operating Partnership | Members in Consolidated Entities | Total Equity | |||||||||||||||||||||||||||||||||||||
Balance at March 31, 2019 | 154,373,581 | $ | 1,543 | $ | 3,485,307 | $ | (41,189) | $ | 9,674 | $ | 17,870 | $ | 267,039 | $ | 3,740,244 | |||||||||||||||||||||||||||||
Distributions | — | — | — | — | — | — | (2,198) | (2,198) | ||||||||||||||||||||||||||||||||||||
Issuance of unrestricted stock | 23,174 | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Declared dividend | — | — | (38,789) | — | — | (348) | — | (39,137) | ||||||||||||||||||||||||||||||||||||
Amortization of stock-based compensation | — | — | 3,637 | — | — | 1,465 | — | 5,102 | ||||||||||||||||||||||||||||||||||||
Net income | — | — | — | 9,834 | — | 77 | 3,317 | 13,228 | ||||||||||||||||||||||||||||||||||||
Other comprehensive loss | — | — | — | — | (8,395) | (65) | — | (8,460) | ||||||||||||||||||||||||||||||||||||
Balance at June 30, 2019 | 154,396,755 | $ | 1,543 | $ | 3,450,155 | $ | (31,355) | $ | 1,279 | $ | 18,999 | $ | 268,158 | $ | 3,708,779 | |||||||||||||||||||||||||||||
Balance at December 31, 2018 | 154,371,538 | $ | 1,543 | $ | 3,524,502 | $ | — | $ | 17,501 | $ | 18,338 | $ | 268,246 | $ | 3,830,130 | |||||||||||||||||||||||||||||
Cumulative adjustment related to adoption of ASC 842 | — | — | — | (2,105) | — | — | — | (2,105) | ||||||||||||||||||||||||||||||||||||
Distributions | — | — | — | — | — | — | (6,226) | (6,226) | ||||||||||||||||||||||||||||||||||||
Issuance of unrestricted stock | 152,097 | 1 | (1) | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Shares withheld to satisfy tax withholding | (126,880) | (1) | (3,667) | — | — | — | — | (3,668) | ||||||||||||||||||||||||||||||||||||
Declared dividend | — | — | (78,030) | — | — | (1,534) | — | (79,564) | ||||||||||||||||||||||||||||||||||||
Amortization of stock-based compensation | — | — | 7,351 | — | — | 2,930 | — | 10,281 | ||||||||||||||||||||||||||||||||||||
Net (loss) income | — | — | — | (29,250) | — | (108) | 6,138 | (23,220) | ||||||||||||||||||||||||||||||||||||
Other comprehensive loss | — | — | — | — | (16,222) | (102) | — | (16,324) | ||||||||||||||||||||||||||||||||||||
Redemption of common units in the operating partnership | — | — | — | — | — | (525) | — | (525) | ||||||||||||||||||||||||||||||||||||
Balance at June 30, 2019 | 154,396,755 | $ | 1,543 | $ | 3,450,155 | $ | (31,355) | $ | 1,279 | $ | 18,999 | $ | 268,158 | $ | 3,708,779 |
Six Months Ended June 30, | |||||||||||||||||
2019 | 2018 | ||||||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||||||||||||
Net (loss) income | $ | (24,072) | $ | 72,254 | |||||||||||||
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | |||||||||||||||||
Depreciation and amortization | 138,111 | 121,259 | |||||||||||||||
Non-cash portion of interest expense | 3,034 | 3,093 | |||||||||||||||
Amortization of stock-based compensation | 10,217 | 8,627 | |||||||||||||||
Loss from unconsolidated real estate investment | 85 | — | |||||||||||||||
Straight-line rents | (28,469) | (17,879) | |||||||||||||||
Straight-line rent expenses | 731 | 262 | |||||||||||||||
Amortization of above- and below-market leases, net | (7,109) | (7,042) | |||||||||||||||
Amortization of above- and below-market ground leases, net | 1,230 | 1,216 | |||||||||||||||
Amortization of lease incentive costs | 769 | 687 | |||||||||||||||
Other non-cash adjustments | (89) | (114) | |||||||||||||||
Impairment loss | 52,201 | — | |||||||||||||||
Gains on sale of real estate | — | (39,602) | |||||||||||||||
Change in operating assets and liabilities: | |||||||||||||||||
Accounts receivable | (99) | (3,057) | |||||||||||||||
Deferred leasing costs and lease intangibles | (16,777) | (21,835) | |||||||||||||||
Prepaid expenses and other assets | (5,081) | (3,250) | |||||||||||||||
Accounts payable, accrued liabilities and other | 27,933 | (12,666) | |||||||||||||||
Security deposits and prepaid rent | (6,899) | 566 | |||||||||||||||
Net cash provided by operating activities | 145,716 | 102,519 | |||||||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||||||||||||||
Additions to investment in real estate | (189,273) | (185,031) | |||||||||||||||
Property acquisitions | — | (30,166) | |||||||||||||||
Maturities of U.S. Government securities | 4,185 | — | |||||||||||||||
Proceeds from sale of real estate | — | 250,199 | |||||||||||||||
Contributions to unconsolidated entities | (64,448) | — | |||||||||||||||
Deposits for property acquisitions | (20,500) | (27,500) | |||||||||||||||
Net cash (used in) provided by investing activities | (270,036) | 7,502 | |||||||||||||||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||||||||||||
Proceeds from unsecured and secured debt | 695,001 | 250,000 | |||||||||||||||
Payments of unsecured and secured debt | (485,283) | (308,660) | |||||||||||||||
Payments of in-substance defeased debt | (1,587) | — | |||||||||||||||
Proceeds from issuance of common stock, net | — | (207) | |||||||||||||||
Repurchase of common units in the operating partnership | (525) | — | |||||||||||||||
Redemption of series A preferred units | — | (362) | |||||||||||||||
Dividends paid to common stock and unitholders | (79,564) | (78,705) | |||||||||||||||
Dividends paid to preferred unitholders | (306) | (312) | |||||||||||||||
Contribution of redeemable non-controlling member in consolidated real estate entities | 2,941 | — | |||||||||||||||
Distribution of redeemable non-controlling member in consolidated real estate entities | (7) | — | |||||||||||||||
Contribution of non-controlling member in consolidated real estate entities | — | 2,691 | |||||||||||||||
Distribution to non-controlling member in consolidated real estate entities | (6,226) | (2,088) | |||||||||||||||
Payments to satisfy tax withholding | (3,668) | (693) | |||||||||||||||
Payment of loan costs, net loan premium paid | (3,100) | (6,978) | |||||||||||||||
Net cash provided by (used in) financing activities | 117,676 | (145,314) | |||||||||||||||
Net decrease in cash and cash equivalents and restricted cash | (6,644) | (35,293) | |||||||||||||||
Cash and cash equivalents and restricted cash—beginning of period | 68,191 | 101,280 | |||||||||||||||
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH—END OF PERIOD | $ | 61,547 | $ | 65,987 | |||||||||||||
Six Months Ended June 30, | |||||||
2018 | 2017 | ||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||
Net income | $ | 72,254 | $ | 31,107 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 121,259 | 146,182 | |||||
Non-cash portion of interest expense | 3,093 | 2,373 | |||||
Amortization of stock-based compensation | 8,627 | 7,788 | |||||
Straight-line rents | (17,879 | ) | (5,781 | ) | |||
Straight-line rent expenses | 262 | 160 | |||||
Amortization of above- and below-market leases, net | (7,042 | ) | (10,405 | ) | |||
Amortization of above- and below-market ground lease, net | 1,216 | 1,470 | |||||
Amortization of lease incentive costs | 687 | 758 | |||||
Other non-cash adjustments(1) | (114 | ) | (30 | ) | |||
Gains on sale of real estate | (39,602 | ) | (16,866 | ) | |||
Change in operating assets and liabilities: | |||||||
Accounts receivable | (3,057 | ) | 3,177 | ||||
Deferred leasing costs and lease intangibles | (21,835 | ) | (15,216 | ) | |||
Prepaid expenses and other assets | (3,250 | ) | (5,873 | ) | |||
Accounts payable and accrued liabilities | (12,666 | ) | 6,304 | ||||
Security deposits and prepaid rent | 566 | (4,112 | ) | ||||
Net cash provided by operating activities | 102,519 | 141,036 | |||||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||||
Additions to investment property | (185,031 | ) | (147,476 | ) | |||
Property acquisitions | (30,166 | ) | (257,734 | ) | |||
Proceeds from sale of real estate | 250,199 | 81,707 | |||||
Distributions from unconsolidated entity | — | 14,893 | |||||
Contributions to unconsolidated entity | — | (1,071 | ) | ||||
Deposits for property acquisitions | (27,500 | ) | — | ||||
Net cash provided by (used in) investing activities | 7,502 | (309,681 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||
Proceeds from notes payable | 250,000 | 230,000 | |||||
Payments of notes payable | (308,660 | ) | (321,270 | ) | |||
Proceeds from issuance of common stock, net | (207 | ) | 647,509 | ||||
Payment for redemption of common units in the operating partnership | — | (310,855 | ) | ||||
Redemption of series A preferred units | (362 | ) | — | ||||
Distributions paid to common stock and unitholders | (78,705 | ) | (79,163 | ) | |||
Distributions paid to preferred unitholders | (312 | ) | (318 | ) | |||
Contributions from non-controlling member in consolidated entities | 2,691 | 3,870 | |||||
Distributions to non-controlling member in consolidated entities | (2,088 | ) | (14,591 | ) | |||
Payments to satisfy tax withholding | (693 | ) | (4,203 | ) | |||
Payments of loan costs | (6,978 | ) | — | ||||
Net cash (used in) provided by financing activities | (145,314 | ) | 150,979 | ||||
Net decrease in cash and cash equivalents and restricted cash | (35,293 | ) | (17,666 | ) | |||
Cash and cash equivalents and restricted cash—beginning of period | 101,280 | 108,192 | |||||
Cash and cash equivalents and restricted cash—end of period | $ | 65,987 | $ | 90,526 | |||
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | |||||||
Cash paid for interest, net of capitalized interest | $ | 39,042 | $ | 42,462 | |||
NON-CASH INVESTING ACTIVITIES: | |||||||
Accounts payable and accrued liabilities for real estate investments | $ | (2,460 | ) | $ | (3,427 | ) | |
Reclassification of investment in unconsolidated entities for real estate investments | $ | — | $ | 7,835 |
June 30, 2019 (unaudited) | December 31, 2018 | ||||||||||
ASSETS | |||||||||||
Investment in real estate, at cost | $ | 7,088,508 | $ | 7,059,537 | |||||||
Accumulated depreciation and amortization | (792,485) | (695,631) | |||||||||
Investment in real estate, net | 6,296,023 | 6,363,906 | |||||||||
Cash and cash equivalents | 48,172 | 53,740 | |||||||||
Restricted cash | 13,375 | 14,451 | |||||||||
Accounts receivable, net | 13,805 | 14,004 | |||||||||
Straight-line rent receivables, net | 170,928 | 142,369 | |||||||||
Deferred leasing costs and lease intangible assets, net | 299,250 | 279,896 | |||||||||
U.S. Government securities | 142,761 | 146,880 | |||||||||
Operating lease right-of-use asset | 270,943 | — | |||||||||
Prepaid expenses and other assets, net | 66,074 | 55,633 | |||||||||
Investment in unconsolidated real estate entity | 65,495 | — | |||||||||
Assets associated with real estate held for sale | 99,840 | — | |||||||||
TOTAL ASSETS | $ | 7,486,666 | $ | 7,070,879 | |||||||
LIABILITIES AND CAPITAL | |||||||||||
Liabilities | |||||||||||
Unsecured and secured debt, net | $ | 2,834,785 | $ | 2,623,835 | |||||||
In-substance defeased debt | 136,636 | 138,223 | |||||||||
Joint venture partner debt | 66,136 | 66,136 | |||||||||
Accounts payable, accrued liabilities and other | 241,990 | 175,300 | |||||||||
Operating lease liability | 273,883 | — | |||||||||
Lease intangible liabilities, net | 37,833 | 45,612 | |||||||||
Security deposits and prepaid rent | 61,788 | 68,687 | |||||||||
Liabilities associated with real estate held for sale | 104 | — | |||||||||
Total liabilities | 3,653,155 | 3,117,793 | |||||||||
Redeemable preferred units of the operating partnership | 9,815 | 9,815 | |||||||||
Redeemable non-controlling interest in consolidated real estate entities | 114,917 | 113,141 | |||||||||
Capital | |||||||||||
Hudson Pacific Properties, L.P. partners’ capital | |||||||||||
Common units, 155,117,528 and 154,940,583 issued and outstanding at June 30, 2019 and December 31, 2018, respectively. | 3,439,380 | 3,544,319 | |||||||||
Accumulated other comprehensive income | 1,241 | 17,565 | |||||||||
Total Hudson Pacific Properties, L.P. partners’ capital | 3,440,621 | 3,561,884 | |||||||||
Non-controlling interest—members in consolidated entities | 268,158 | 268,246 | |||||||||
Total capital | 3,708,779 | 3,830,130 | |||||||||
TOTAL LIABILITIES AND CAPITAL | $ | 7,486,666 | $ | 7,070,879 | |||||||
June 30, 2018 (unaudited) | December 31, 2017 | ||||||
ASSETS | |||||||
Investment in real estate, at cost | $ | 6,418,882 | $ | 6,219,361 | |||
Accumulated depreciation and amortization | (601,535 | ) | (521,370 | ) | |||
Investment in real estate, net | 5,817,347 | 5,697,991 | |||||
Cash and cash equivalents | 57,515 | 78,922 | |||||
Restricted cash | 8,472 | 22,358 | |||||
Accounts receivable, net | 6,615 | 4,234 | |||||
Straight-line rent receivables, net | 124,083 | 106,466 | |||||
Deferred leasing costs and lease intangible assets, net | 236,582 | 239,029 | |||||
Prepaid expenses and other assets, net | 107,549 | 61,139 | |||||
Assets associated with real estate held for sale | 201,011 | 411,931 | |||||
TOTAL ASSETS | $ | 6,559,174 | $ | 6,622,070 | |||
LIABILITIES | |||||||
Notes payable, net | $ | 2,361,749 | $ | 2,421,380 | |||
Accounts payable and accrued liabilities | 151,697 | 162,081 | |||||
Lease intangible liabilities, net | 41,729 | 49,540 | |||||
Security deposits and prepaid rent | 64,582 | 62,760 | |||||
Derivative liabilities | — | 265 | |||||
Liabilities associated with real estate held for sale | 3,554 | 4,903 | |||||
TOTAL LIABILITIES | 2,623,311 | 2,700,929 | |||||
Redeemable non-controlling interest | 9,815 | 10,177 | |||||
CAPITAL | |||||||
Hudson Pacific Properties, L.P. partners’ capital: | |||||||
Common units, 156,216,778 and 156,171,553 issued and outstanding at June 30, 2018 and December 31, 2017, respectively. | 3,633,849 | 3,639,086 | |||||
Accumulated other comprehensive income | 26,504 | 13,276 | |||||
Total Hudson Pacific Properties, L.P. partners’ capital | 3,660,353 | 3,652,362 | |||||
Non-controlling interest—members in consolidated entities | 265,695 | 258,602 | |||||
TOTAL CAPITAL | 3,926,048 | 3,910,964 | |||||
TOTAL LIABILITIES AND CAPITAL | $ | 6,559,174 | $ | 6,622,070 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||||||||||||||||||||||
REVENUES | |||||||||||||||||||||||||||||||||||
Office | |||||||||||||||||||||||||||||||||||
Rental (Note 2) | $ | 172,256 | $ | 129,732 | $ | 342,453 | $ | 259,814 | |||||||||||||||||||||||||||
Tenant recoveries (Note 2) | — | 21,960 | — | 42,864 | |||||||||||||||||||||||||||||||
Service revenues (Note 2) | 6,791 | 6,858 | 12,452 | 12,404 | |||||||||||||||||||||||||||||||
Total office revenues | 179,047 | 158,550 | 354,905 | 315,082 | |||||||||||||||||||||||||||||||
Studio | |||||||||||||||||||||||||||||||||||
Rental (Note 2) | 14,521 | 10,708 | 26,915 | 21,091 | |||||||||||||||||||||||||||||||
Tenant recoveries (Note 2) | — | 500 | — | 854 | |||||||||||||||||||||||||||||||
Service revenues and other (Note 2) | 3,088 | 5,411 | 12,225 | 12,260 | |||||||||||||||||||||||||||||||
Total studio revenues | 17,609 | 16,619 | 39,140 | 34,205 | |||||||||||||||||||||||||||||||
Total revenues | 196,656 | 175,169 | 394,045 | 349,287 | |||||||||||||||||||||||||||||||
OPERATING EXPENSES | |||||||||||||||||||||||||||||||||||
Office operating expenses | 60,896 | 53,940 | 121,711 | 107,180 | |||||||||||||||||||||||||||||||
Studio operating expenses | 9,539 | 8,539 | 20,648 | 18,203 | |||||||||||||||||||||||||||||||
General and administrative | 18,344 | 16,203 | 36,438 | 31,767 | |||||||||||||||||||||||||||||||
Depreciation and amortization | 69,606 | 60,706 | 138,111 | 121,259 | |||||||||||||||||||||||||||||||
Total operating expenses | 158,385 | 139,388 | 316,908 | 278,409 | |||||||||||||||||||||||||||||||
OTHER (EXPENSE) INCOME | |||||||||||||||||||||||||||||||||||
Loss from unconsolidated real estate investments | (85) | — | (85) | — | |||||||||||||||||||||||||||||||
Interest expense | (26,552) | (19,331) | (50,902) | (39,834) | |||||||||||||||||||||||||||||||
Interest income | 1,008 | 66 | 2,032 | 75 | |||||||||||||||||||||||||||||||
Transaction-related expenses | — | — | (128) | (118) | |||||||||||||||||||||||||||||||
Other income | 181 | 319 | 75 | 723 | |||||||||||||||||||||||||||||||
Unrealized gain on non-real estate investment | — | 928 | — | 928 | |||||||||||||||||||||||||||||||
Gains on sale of real estate | — | 1,928 | — | 39,602 | |||||||||||||||||||||||||||||||
Impairment loss | — | — | (52,201) | — | |||||||||||||||||||||||||||||||
Total other (expense) income | (25,448) | (16,090) | (101,209) | 1,376 | |||||||||||||||||||||||||||||||
Net income (loss) | 12,823 | 19,691 | (24,072) | 72,254 | |||||||||||||||||||||||||||||||
Net income attributable to non-controlling interest in consolidated real estate entities | (3,317) | (3,167) | (6,138) | (6,490) | |||||||||||||||||||||||||||||||
Net loss attributable to redeemable non-controlling interest in consolidated real estate entities | 558 | — | 1,158 | — | |||||||||||||||||||||||||||||||
Net income (loss) attributable to Hudson Pacific Properties, L.P. | 10,064 | 16,524 | (29,052) | 65,764 | |||||||||||||||||||||||||||||||
Net income attributable to preferred units | (153) | (153) | (306) | (312) | |||||||||||||||||||||||||||||||
Net income attributable to participating securities | (48) | (110) | (356) | (437) | |||||||||||||||||||||||||||||||
NET INCOME (LOSS) AVAILABLE TO COMMON UNITHOLDERS | $ | 9,863 | $ | 16,261 | $ | (29,714) | $ | 65,015 | |||||||||||||||||||||||||||
BASIC AND DILUTED PER UNIT AMOUNTS | |||||||||||||||||||||||||||||||||||
Net income (loss) attributable to common unitholders—basic | $ | 0.06 | $ | 0.10 | $ | (0.19) | $ | 0.42 | |||||||||||||||||||||||||||
Net income (loss) attributable to common unitholders—diluted | $ | 0.06 | $ | 0.10 | $ | (0.19) | $ | 0.41 | |||||||||||||||||||||||||||
Weighted average shares of common units outstanding—basic | 155,105,359 | 156,205,681 | 155,047,979 | 156,198,825 | |||||||||||||||||||||||||||||||
Weighted average shares of common units outstanding—diluted | 156,175,004 | 157,159,272 | 155,047,979 | 157,131,416 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
REVENUES | |||||||||||||||
Office | |||||||||||||||
Rental | $ | 129,732 | $ | 133,602 | $ | 259,814 | $ | 267,118 | |||||||
Tenant recoveries | 21,960 | 25,038 | 42,864 | 42,439 | |||||||||||
Parking and other | 6,858 | 8,212 | 12,404 | 14,111 | |||||||||||
Total Office revenues | 158,550 | 166,852 | 315,082 | 323,668 | |||||||||||
Studio | |||||||||||||||
Rental | 10,708 | 9,105 | 21,091 | 15,790 | |||||||||||
Tenant recoveries | 500 | 129 | 854 | 794 | |||||||||||
Other property-related revenue | 5,301 | 4,361 | 11,736 | 8,403 | |||||||||||
Other | 110 | 53 | 524 | 130 | |||||||||||
Total Studio revenues | 16,619 | 13,648 | 34,205 | 25,117 | |||||||||||
TOTAL REVENUES | 175,169 | 180,500 | 349,287 | 348,785 | |||||||||||
OPERATING EXPENSES | |||||||||||||||
Office operating expenses | 53,940 | 55,468 | 107,180 | 103,422 | |||||||||||
Studio operating expenses | 8,539 | 7,003 | 18,203 | 14,254 | |||||||||||
General and administrative | 16,203 | 14,506 | 31,767 | 28,316 | |||||||||||
Depreciation and amortization | 60,706 | 75,415 | 121,259 | 146,182 | |||||||||||
TOTAL OPERATING EXPENSES | 139,388 | 152,392 | 278,409 | 292,174 | |||||||||||
INCOME FROM OPERATIONS | 35,781 | 28,108 | 70,878 | 56,611 | |||||||||||
OTHER EXPENSE (INCOME) | |||||||||||||||
Interest expense | 19,331 | 21,695 | 39,834 | 43,625 | |||||||||||
Interest income | (66 | ) | (16 | ) | (75 | ) | (46 | ) | |||||||
Unrealized loss on ineffective portion of derivatives | — | 51 | — | 45 | |||||||||||
Unrealized gain on non-real estate investment | (928 | ) | — | (928 | ) | — | |||||||||
Transaction-related expenses | — | — | 118 | — | |||||||||||
Other income | (319 | ) | (576 | ) | (723 | ) | (1,254 | ) | |||||||
TOTAL OTHER EXPENSES | 18,018 | 21,154 | 38,226 | 42,370 | |||||||||||
INCOME BEFORE GAINS ON SALE OF REAL ESTATE | 17,763 | 6,954 | 32,652 | 14,241 | |||||||||||
Gains on sale of real estate | 1,928 | — | 39,602 | 16,866 | |||||||||||
NET INCOME | 19,691 | 6,954 | 72,254 | 31,107 | |||||||||||
Net income attributable to non-controlling interest in consolidated entities | (3,167 | ) | (2,974 | ) | (6,490 | ) | (6,011 | ) | |||||||
Net income attributable to Hudson Pacific Properties, L.P. | 16,524 | 3,980 | 65,764 | 25,096 | |||||||||||
Net income attributable to preferred units | (153 | ) | (159 | ) | (312 | ) | (318 | ) | |||||||
Net income attributable to participating securities | (110 | ) | (255 | ) | (437 | ) | (495 | ) | |||||||
Net income available to common unitholders | $ | 16,261 | $ | 3,566 | $ | 65,015 | $ | 24,283 | |||||||
Basic and diluted per unit amounts: | |||||||||||||||
Net income attributable to common unitholders—basic | $ | 0.10 | $ | 0.02 | $ | 0.42 | $ | 0.16 | |||||||
Net income attributable to common unitholders—diluted | $ | 0.10 | $ | 0.02 | $ | 0.41 | $ | 0.16 | |||||||
Weighted average shares of common units outstanding—basic | 156,205,681 | 155,859,604 | 156,198,825 | 152,647,055 | |||||||||||
Weighted average shares of common units outstanding—diluted | 157,159,272 | 156,664,648 | 157,131,416 | 153,438,100 | |||||||||||
Dividends declared per unit | $ | 0.25 | $ | 0.25 | $ | 0.50 | $ | 0.50 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||||||||||||||||||||||
Net income (loss) | $ | 12,823 | $ | 19,691 | $ | (24,072) | $ | 72,254 | |||||||||||||||||||||||||||
Currency translation adjustment | 1,315 | — | 1,315 | — | |||||||||||||||||||||||||||||||
Net unrealized (losses) gains on derivative instruments: | |||||||||||||||||||||||||||||||||||
Unrealized (losses) gains | (7,937) | 4,185 | (13,891) | 13,726 | |||||||||||||||||||||||||||||||
Reclassification adjustment for realized gains | (1,838) | (701) | (3,748) | (729) | |||||||||||||||||||||||||||||||
(9,775) | 3,484 | (17,639) | 12,997 | ||||||||||||||||||||||||||||||||
Total other comprehensive (loss) income | (8,460) | 3,484 | (16,324) | 12,997 | |||||||||||||||||||||||||||||||
Comprehensive income (loss) | 4,363 | 23,175 | (40,396) | 85,251 | |||||||||||||||||||||||||||||||
Comprehensive income attributable to preferred units | (153) | (153) | (306) | (312) | |||||||||||||||||||||||||||||||
Comprehensive income attributable to participating securities | (48) | (133) | (356) | (524) | |||||||||||||||||||||||||||||||
Comprehensive income attributable to non-controlling interest in consolidated real estate entities | (3,317) | (3,167) | (6,138) | (6,490) | |||||||||||||||||||||||||||||||
Comprehensive loss attributable to redeemable non-controlling interest in consolidated real estate entities | 558 | — | 1,158 | — | |||||||||||||||||||||||||||||||
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO PARTNERS’ CAPITAL | $ | 1,403 | $ | 19,722 | $ | (46,038) | $ | 77,925 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Net income | $ | 19,691 | $ | 6,954 | $ | 72,254 | $ | 31,107 | |||||||
Other comprehensive income (loss): change in fair value of derivatives | 3,484 | (2,760 | ) | 12,997 | 104 | ||||||||||
Comprehensive income | 23,175 | 4,194 | 85,251 | 31,211 | |||||||||||
Comprehensive income attributable to preferred units | (153 | ) | (159 | ) | (312 | ) | (318 | ) | |||||||
Comprehensive income attributable to participating securities | (133 | ) | (255 | ) | (524 | ) | (495 | ) | |||||||
Comprehensive income attributable to non-controlling interest in consolidated entities | (3,167 | ) | (2,974 | ) | (6,490 | ) | (6,011 | ) | |||||||
Comprehensive income attributable to Hudson Pacific Properties, L.P. partners’ capital | $ | 19,722 | $ | 806 | $ | 77,925 | $ | 24,387 |
Hudson Pacific Properties, L.P. Partners’ Capital | ||||||||||||||||||||||||||
Number of Common Units | Common Units | Accumulated Other Comprehensive Income | Total Partners’ Capital | Non-controlling Interest—Members in Consolidated Entities | Total Capital | |||||||||||||||||||||
Balance at March 31, 2018 | 156,195,100 | $ | 3,652,289 | $ | 23,020 | $ | 3,675,309 | $ | 263,556 | $ | 3,938,865 | |||||||||||||||
Distributions | — | — | — | — | (1,028) | (1,028) | ||||||||||||||||||||
Proceeds from sale of common units, net of underwriters’ discount and transaction costs | — | (34) | — | (34) | — | (34) | ||||||||||||||||||||
Issuance of unrestricted units | 21,678 | — | — | — | — | — | ||||||||||||||||||||
Declared distributions | — | (39,354) | — | (39,354) | — | (39,354) | ||||||||||||||||||||
Amortization of unit-based compensation | — | 4,577 | — | 4,577 | — | 4,577 | ||||||||||||||||||||
Net income | — | 16,371 | — | 16,371 | 3,167 | 19,538 | ||||||||||||||||||||
Other comprehensive gain | — | — | 3,484 | 3,484 | — | 3,484 | ||||||||||||||||||||
Balance at June 30, 2018 | 156,216,778 | $ | 3,633,849 | $ | 26,504 | $ | 3,660,353 | $ | 265,695 | $ | 3,926,048 | |||||||||||||||
Balance at December 31, 2017 | 156,171,553 | $ | 3,639,086 | $ | 13,276 | $ | 3,652,362 | $ | 258,602 | $ | 3,910,964 | |||||||||||||||
Cumulative adjustment related to adoption of ASU 2017-12 | — | (231) | 231 | — | — | — | ||||||||||||||||||||
Contributions | — | — | — | — | 2,691 | 2,691 | ||||||||||||||||||||
Distributions | — | — | — | — | (2,088) | (2,088) | ||||||||||||||||||||
Proceeds from sale of common units, net of underwriters’ discount and transaction costs | — | (207) | — | (207) | — | (207) | ||||||||||||||||||||
Issuance of unrestricted units | 65,578 | — | — | — | — | — | ||||||||||||||||||||
Units withheld to satisfy tax withholding | (20,353) | (693) | — | (693) | — | (693) | ||||||||||||||||||||
Declared distributions | — | (78,705) | — | (78,705) | — | (78,705) | ||||||||||||||||||||
Amortization of unit-based compensation | — | 9,147 | — | 9,147 | — | 9,147 | ||||||||||||||||||||
Net income | — | 65,452 | — | 65,452 | 6,490 | 71,942 | ||||||||||||||||||||
Other comprehensive gain | — | — | 12,997 | 12,997 | — | 12,997 | ||||||||||||||||||||
Balance at June 30, 2018 | 156,216,778 | $ | 3,633,849 | $ | 26,504 | $ | 3,660,353 | $ | 265,695 | $ | 3,926,048 |
Hudson Pacific Properties, L.P. Partners’ Capital | |||||||||||||||||||||||||||||||||||||||||||
Hudson Pacific Properties, L.P. Partners’ Capital | Number of Common Units | Common Units | Accumulated Other Comprehensive Income (Loss) | Total Partners’ Capital | Non-controlling Interest—Members in Consolidated Entities | Total Capital | |||||||||||||||||||||||||||||||||||||
Number of Common Units | Common Units | Accumulated Other Comprehensive Income | Total Partners’ Capital | Non-controlling Interest—Members in Consolidated Entities | Total Capital | ||||||||||||||||||||||||||||||||||||||
Balance at January 1, 2017 | 145,942,855 | $ | 3,392,264 | $ | 5,878 | $ | 3,398,142 | $ | 304,608 | $ | 3,702,750 | ||||||||||||||||||||||||||||||||
Contributions | — | — | — | — | 3,870 | 3,870 | |||||||||||||||||||||||||||||||||||||
Balance at March 31, 2019 | Balance at March 31, 2019 | 155,094,354 | $ | 3,463,504 | $ | 9,701 | $ | 3,473,205 | $ | 267,039 | $ | 3,740,244 | |||||||||||||||||||||||||||||||
Distributions | — | — | — | — | (74,836 | ) | (74,836 | ) | Distributions | — | (2,198) | (2,198) | |||||||||||||||||||||||||||||||
Proceeds from sale of common units, net of underwriters’ discount and transaction costs | 18,656,575 | 647,382 | — | 647,382 | — | 647,382 | |||||||||||||||||||||||||||||||||||||
Issuance of unrestricted units | 917,086 | — | — | — | — | — | Issuance of unrestricted units | 23,174 | — | — | |||||||||||||||||||||||||||||||||
Units withheld to satisfy tax withholding | (463,388 | ) | (16,041 | ) | — | (16,041 | ) | — | (16,041 | ) | |||||||||||||||||||||||||||||||||
Declared distributions | — | (158,544 | ) | — | (158,544 | ) | — | (158,544 | ) | Declared distributions | — | (39,137) | — | (39,137) | — | (39,137) | |||||||||||||||||||||||||||
Amortization of unit-based compensation | — | 15,915 | — | 15,915 | — | 15,915 | Amortization of unit-based compensation | — | 5,102 | — | 5,102 | — | 5,102 | ||||||||||||||||||||||||||||||
Net income | — | 68,965 | — | 68,965 | 24,960 | 93,925 | Net income | — | 9,911 | — | 9,911 | 3,317 | 13,228 | ||||||||||||||||||||||||||||||
Change in fair value of derivatives | — | — | 7,398 | 7,398 | — | 7,398 | |||||||||||||||||||||||||||||||||||||
Redemption of common units | (8,881,575 | ) | (310,855 | ) | — | (310,855 | ) | — | (310,855 | ) | |||||||||||||||||||||||||||||||||
Balance at December 31, 2017 | 156,171,553 | 3,639,086 | 13,276 | 3,652,362 | 258,602 | 3,910,964 | |||||||||||||||||||||||||||||||||||||
Cumulative adjustment related to adoption of ASU 2017-12 | — | (231 | ) | 231 | — | — | — | ||||||||||||||||||||||||||||||||||||
Contributions | — | — | — | — | 2,691 | 2,691 | |||||||||||||||||||||||||||||||||||||
Other comprehensive loss | Other comprehensive loss | — | (8,460) | — | (8,460) | ||||||||||||||||||||||||||||||||||||||
Balance at June 30, 2019 | Balance at June 30, 2019 | 155,117,528 | $ | 3,439,380 | $ | 1,241 | $ | 3,440,621 | $ | 268,158 | $ | 3,708,779 | |||||||||||||||||||||||||||||||
Balance at December 31, 2018 | Balance at December 31, 2018 | 154,940,583 | $ | 3,544,319 | $ | 17,565 | $ | 3,561,884 | $ | 268,246 | $ | 3,830,130 | |||||||||||||||||||||||||||||||
Cumulative adjustment related to adoption of ASC 842 | Cumulative adjustment related to adoption of ASC 842 | — | (2,105) | — | (2,105) | — | (2,105) | ||||||||||||||||||||||||||||||||||||
Distributions | — | — | — | — | (2,088 | ) | (2,088 | ) | Distributions | — | (6,226) | (6,226) | |||||||||||||||||||||||||||||||
Proceeds from sale of common units, net of underwriters’ discount and transaction costs | — | (207 | ) | — | (207 | ) | — | (207 | ) | ||||||||||||||||||||||||||||||||||
Issuance of unrestricted units | 65,578 | — | — | — | — | — | Issuance of unrestricted units | 321,901 | — | — | |||||||||||||||||||||||||||||||||
Units withheld to satisfy tax withholding | (20,353 | ) | (693 | ) | — | (693 | ) | — | (693 | ) | Units withheld to satisfy tax withholding | (126,880) | (3,668) | — | (3,668) | — | (3,668) | ||||||||||||||||||||||||||
Declared distributions | — | (78,705 | ) | — | (78,705 | ) | — | (78,705 | ) | Declared distributions | — | (79,564) | — | (79,564) | — | (79,564) | |||||||||||||||||||||||||||
Amortization of unit-based compensation | — | 9,147 | — | 9,147 | — | 9,147 | Amortization of unit-based compensation | — | 10,281 | — | 10,281 | — | 10,281 | ||||||||||||||||||||||||||||||
Net income | — | 65,452 | — | 65,452 | 6,490 | 71,942 | |||||||||||||||||||||||||||||||||||||
Change in fair value of derivatives | — | — | 12,997 | 12,997 | — | 12,997 | |||||||||||||||||||||||||||||||||||||
Balance at June 30, 2018 | 156,216,778 | $ | 3,633,849 | $ | 26,504 | $ | 3,660,353 | $ | 265,695 | $ | 3,926,048 | ||||||||||||||||||||||||||||||||
Net (loss) income | Net (loss) income | — | (29,358) | — | (29,358) | 6,138 | (23,220) | ||||||||||||||||||||||||||||||||||||
Other comprehensive loss | Other comprehensive loss | — | (16,324) | — | (16,324) | ||||||||||||||||||||||||||||||||||||||
Redemption of common units | Redemption of common units | (18,076) | (525) | — | (525) | — | (525) | ||||||||||||||||||||||||||||||||||||
Balance at June 30, 2019 | Balance at June 30, 2019 | 155,117,528 | $ | 3,439,380 | $ | 1,241 | $ | 3,440,621 | $ | 268,158 | $ | 3,708,779 |
Six Months Ended June 30, | |||||||||||||||||
2019 | 2018 | ||||||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||||||||||||
Net (loss) income | $ | (24,072) | $ | 72,254 | |||||||||||||
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | |||||||||||||||||
Depreciation and amortization | 138,111 | 121,259 | |||||||||||||||
Non-cash portion of interest expense | 3,034 | 3,093 | |||||||||||||||
Amortization of unit-based compensation | 10,217 | 8,627 | |||||||||||||||
Loss from unconsolidated real estate investment | 85 | — | |||||||||||||||
Straight-line rents | (28,469) | (17,879) | |||||||||||||||
Straight-line rent expenses | 731 | 262 | |||||||||||||||
Amortization of above- and below-market leases, net | (7,109) | (7,042) | |||||||||||||||
Amortization of above- and below-market ground leases, net | 1,230 | 1,216 | |||||||||||||||
Amortization of lease incentive costs | 769 | 687 | |||||||||||||||
Other non-cash adjustments | (89) | (114) | |||||||||||||||
Impairment loss | 52,201 | — | |||||||||||||||
Gains on sale of real estate | — | (39,602) | |||||||||||||||
Change in operating assets and liabilities: | |||||||||||||||||
Accounts receivable | (99) | (3,057) | |||||||||||||||
Deferred leasing costs and lease intangibles | (16,777) | (21,835) | |||||||||||||||
Prepaid expenses and other assets | (5,081) | (3,250) | |||||||||||||||
Accounts payable and accrued liabilities and other | 27,933 | (12,666) | |||||||||||||||
Security deposits and prepaid rent | (6,899) | 566 | |||||||||||||||
Net cash provided by operating activities | 145,716 | 102,519 | |||||||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||||||||||||||
Additions to investment in real estate | (189,273) | (185,031) | |||||||||||||||
Property acquisitions | — | (30,166) | |||||||||||||||
Maturities of U.S. Government securities | 4,185 | — | |||||||||||||||
Proceeds from sale of real estate | — | 250,199 | |||||||||||||||
Contributions to unconsolidated entities | (64,448) | — | |||||||||||||||
Deposits for property acquisitions | (20,500) | (27,500) | |||||||||||||||
Net cash (used in) provided by investing activities | (270,036) | 7,502 | |||||||||||||||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||||||||||||
Proceeds from unsecured and secured debt | 695,001 | 250,000 | |||||||||||||||
Payments of unsecured and secured debt | (485,283) | (308,660) | |||||||||||||||
Payments of in-substance defeased debt | (1,587) | — | |||||||||||||||
Proceeds from issuance of common units, net | — | (207) | |||||||||||||||
Repurchase of common units in the operating partnership | (525) | — | |||||||||||||||
Redemption of series A preferred units | — | (362) | |||||||||||||||
Distributions paid to common stock and unitholders | (79,564) | (78,705) | |||||||||||||||
Distributions paid to preferred unitholders | (306) | (312) | |||||||||||||||
Contribution of redeemable non-controlling member in consolidated real estate entities | 2,941 | — | |||||||||||||||
Distribution of redeemable non-controlling member in consolidated real estate entities | (7) | — | |||||||||||||||
Contribution of non-controlling member in consolidated real estate entities | — | 2,691 | |||||||||||||||
Distribution to non-controlling member in consolidated real estate entities | (6,226) | (2,088) | |||||||||||||||
Payments to satisfy tax withholding | (3,668) | (693) | |||||||||||||||
Payment of loan costs, net loan premium paid | (3,100) | (6,978) | |||||||||||||||
Net cash provided by (used in) financing activities | 117,676 | (145,314) | |||||||||||||||
Net decrease in cash and cash equivalents and restricted cash | (6,644) | (35,293) | |||||||||||||||
Cash and cash equivalents and restricted cash—beginning of period | 68,191 | 101,280 | |||||||||||||||
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH—END OF PERIOD | $ | 61,547 | $ | 65,987 | |||||||||||||
Six Months Ended June 30, | |||||||
2018 | 2017 | ||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||
Net income | $ | 72,254 | $ | 31,107 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 121,259 | 146,182 | |||||
Non-cash portion of interest expense | 3,093 | 2,373 | |||||
Amortization of unit-based compensation | 8,627 | 7,788 | |||||
Straight-line rents | (17,879 | ) | (5,781 | ) | |||
Straight-line rent expenses | 262 | 160 | |||||
Amortization of above- and below-market leases, net | (7,042 | ) | (10,405 | ) | |||
Amortization of above- and below-market ground lease, net | 1,216 | 1,470 | |||||
Amortization of lease incentive costs | 687 | 758 | |||||
Other non-cash adjustments(1) | (114 | ) | (30 | ) | |||
Gains on sale of real estate | (39,602 | ) | (16,866 | ) | |||
Change in operating assets and liabilities: | |||||||
Accounts receivable | (3,057 | ) | 3,177 | ||||
Deferred leasing costs and lease intangibles | (21,835 | ) | (15,216 | ) | |||
Prepaid expenses and other assets | (3,250 | ) | (5,873 | ) | |||
Accounts payable and accrued liabilities | (12,666 | ) | 6,304 | ||||
Security deposits and prepaid rent | 566 | (4,112 | ) | ||||
Net cash provided by operating activities | 102,519 | 141,036 | |||||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||||
Additions to investment property | (185,031 | ) | (147,476 | ) | |||
Property acquisitions | (30,166 | ) | (257,734 | ) | |||
Proceeds from sale of real estate | 250,199 | 81,707 | |||||
Distributions from unconsolidated entity | — | 14,893 | |||||
Contributions to unconsolidated entity | — | (1,071 | ) | ||||
Deposits for property acquisitions | (27,500 | ) | — | ||||
Net cash provided by (used in) investing activities | 7,502 | (309,681 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||
Proceeds from notes payable | 250,000 | 230,000 | |||||
Payments of notes payable | (308,660 | ) | (321,270 | ) | |||
Proceeds from issuance of common units, net | (207 | ) | 647,509 | ||||
Payments for redemption of common units | — | (310,855 | ) | ||||
Redemption of series A preferred units | (362 | ) | — | ||||
Distributions paid to common unitholders | (78,705 | ) | (79,163 | ) | |||
Distributions paid to preferred unitholders | (312 | ) | (318 | ) | |||
Contributions from non-controlling member in consolidated entities | 2,691 | 3,870 | |||||
Distributions to non-controlling member in consolidated entities | (2,088 | ) | (14,591 | ) | |||
Payments to satisfy tax withholding | (693 | ) | (4,203 | ) | |||
Payments of loan costs | (6,978 | ) | — | ||||
Net cash (used in) provided by financing activities | (145,314 | ) | 150,979 | ||||
Net decrease in cash and cash equivalents and restricted cash | (35,293 | ) | (17,666 | ) | |||
Cash and cash equivalents and restricted cash—beginning of period | 101,280 | 108,192 | |||||
Cash and cash equivalents and restricted cash—end of period | $ | 65,987 | $ | 90,526 | |||
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | |||||||
Cash paid for interest, net of capitalized interest | $ | 39,042 | $ | 42,462 | |||
NON-CASH INVESTING ACTIVITIES: | |||||||
Accounts payable and accrued liabilities for real estate investments | $ | (2,460 | ) | $ | (3,427 | ) | |
Reclassification of investment in unconsolidated entities for real estate investments | $ | — | $ | 7,835 |
Segments | Number of Properties | Square Feet (unaudited) | Segments | Number of Properties | Square Feet (unaudited) | ||||||||||||||
Consolidated portfolio | Consolidated portfolio | ||||||||||||||||||
Office | 50 | 13,336,940 | Office | 52 | 13,866,807 | ||||||||||||||
Studio | 3 | 1,246,423 | |||||||||||||||||
Total(1) | 53 | 14,583,363 | |||||||||||||||||
Studios | Studios | 3 | 1,224,403 | ||||||||||||||||
Total consolidated portfolio | Total consolidated portfolio | 55 | 15,091,210 | ||||||||||||||||
Unconsolidated office(1) | Unconsolidated office(1) | 1 | 1,455,007 | ||||||||||||||||
TOTAL(2) | TOTAL(2) | 56 | 16,546,217 |
Entity | Property | Ownership Interest | |||||||||||||
Hudson 1455 Market, L.P. | 1455 Market | 55.0 | % | ||||||||||||
Hudson 1099 Stewart, L.P. | Hill7 | 55.0 | % | ||||||||||||
HPP-MAC WSP, LLC | One Westside and 10850 Pico | 75.0 | % | ||||||||||||
Hudson One Ferry REIT, L.P. | Ferry Building | 55.0 | % |
Revenue Stream | Components | Financial Statement Location(1) | ||||||||||||
Rental revenues | Office rentals, stage rentals and storage rentals | Office and | ||||||||||||
Tenant recoveries and other tenant-related revenues | Reimbursement of real estate taxes, insurance, repairs and maintenance, other operating expenses and | Office Studio segment: rental and | ||||||||||||
Ancillary revenues | Revenues derived from tenants’ use of lighting, equipment rental, power, HVAC and telecommunications (i.e., telephone and internet) | Studio | ||||||||||||
Guest parking revenues | Parking revenue that is not associated with lease agreements | Office Studio segment: service revenue and other | ||||||||||||
Sale of real estate | Gains on sales derived from cash consideration less cost basis | Gains on sale of real estate |
Three Months Ended June 30, | Six Month Ended June 30, | |||||||||||||||||||||||||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||||||||||||||||||||||||
Ancillary revenues | $ | 3,882 | $ | 4,086 | $ | 11,968 | $ | 9,406 | ||||||||||||||||||||||||||||||
Guest parking revenues | $ | 5,267 | $ | 5,861 | $ | 11,714 | $ | 11,274 | ||||||||||||||||||||||||||||||
Studio related tenant recoveries(1) | $ | 720 | N/A | $ | 995 | N/A |
June 30, 2019 | December 31, 2018 | |||||||||||||
Ancillary revenues | $ | 967 | $ | 3,752 | ||||||||||
Guest parking revenues | $ | 1,292 | $ | 959 | ||||||||||
Studio related tenant recoveries(1) | $ | 14 | N/A |
Standard | Description | Effect on the Financial Statements or Other Significant Matters | ||||||||||||
ASU ASU 2019-01, Leases (Topic 842): Codification Improvements ASU 2018-11, Leases (Topic 842): Targeted Improvements ASU 2018-10, Codification Improvements to Topic 842, Leases ASU 2018-01, Leases (Topic 842): Land Easement Practical Expedient for Transition to Topic 842 | Issued on February 5, 2016, ASU 2016-02 amends the accounting guidance for leases and sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a lease agreement (i.e., lessees and lessors). | The | ||||||||||||
ASU 2018-16, Derivatives and Hedging (Topic 815): Inclusion of the Secured Overnight Financing Rate (SOFR) Overnight Index Swap (OIS) Rate as a Benchmark Interest Rate for Hedge Accounting Purposes | The amendments in | The Company adopted this guidance during | ||||||||||||
Standard | Description | Effect on the Financial Statements or Other Significant Matters | ||||||||||||||
ASU | The amendments in this update allow a reclassification from accumulated other comprehensive income to | The Company adopted this guidance during | ||||||||||||||
Standard | Description | Effective Date | Effect on the Financial Statements or Other Significant Matters | |||||||||||||||||
ASU | The | The Company is currently evaluating the impact of this | ||||||||||||||||||
ASU | The measuring financial instruments to | The Company is currently evaluating the impact of this | ||||||||||||||||||
June 30, 2019 | December 31, 2018 | ||||||||||
Land | $ | 1,313,411 | $ | 1,372,872 | |||||||
Building and improvements | 4,968,626 | 4,991,770 | |||||||||
Tenant improvements | 569,976 | 510,217 | |||||||||
Furniture and fixtures | 9,573 | 9,320 | |||||||||
Property under development | 226,922 | 175,358 | |||||||||
INVESTMENT IN REAL ESTATE, AT COST(1) | $ | 7,088,508 | $ | 7,059,537 |
June 30, 2018 | December 31, 2017 | ||||||
Land | $ | 1,220,267 | $ | 1,204,700 | |||
Building and improvements | 4,443,050 | 4,389,846 | |||||
Tenant improvements | 443,548 | 397,012 | |||||
Furniture and fixtures | 8,756 | 8,576 | |||||
Property under development | 303,261 | 219,227 | |||||
Investment in real estate, at cost(1) | $ | 6,418,882 | $ | 6,219,361 |
Property | Date of Disposal | Approximate Square Feet | Sales Price(1) (in millions) | ||||||
Embarcadero Place | 1/25/2018 | 197,402 | $ | 136.0 | |||||
2600 Campus Drive (building 6 of Peninsula Office Park) | 1/31/2018 | 63,050 | 22.5 | ||||||
2180 Sand Hill | 3/1/2018 | 45,613 | 82.5 | ||||||
9300 Wilshire | 4/10/2018 | 61,422 | 13.8 | ||||||
Total dispositions | 367,487 | $ | 254.8 |
June 30, 2019 | |||||||||||
ASSETS | |||||||||||
Investment in real estate, net | $ | 99,726 | |||||||||
Prepaid expenses and other assets, net | 114 | ||||||||||
ASSETS ASSOCIATED WITH REAL ESTATE HELD FOR SALE | $ | 99,840 | |||||||||
LIABILITIES | |||||||||||
Accounts payable, accrued liabilities and other | $ | 104 | |||||||||
LIABILITIES ASSOCIATED WITH REAL ESTATE HELD FOR SALE | $ | 104 |
June 30, 2018 | December 31, 2017 | ||||||
ASSETS | |||||||
Investment in real estate, net | $ | 192,630 | $ | 396,846 | |||
Accounts receivable, net | 75 | 213 | |||||
Straight-line rent receivables, net | 3,292 | 5,225 | |||||
Deferred leasing costs and lease intangible assets, net | 4,998 | 9,589 | |||||
Prepaid expenses and other assets, net | 16 | 58 | |||||
Assets associated with real estate held for sale | $ | 201,011 | $ | 411,931 | |||
LIABILITIES | |||||||
Accounts payable and accrued liabilities | $ | 1,929 | $ | 1,808 | |||
Lease intangible liabilities, net | 271 | 485 | |||||
Security deposits and prepaid rent | 1,354 | 2,610 | |||||
Liabilities associated with real estate held for sale | $ | 3,554 | $ | 4,903 |
June 30, 2019 | December 31, 2018 | ||||||||||
Deferred leasing costs and in-place lease intangibles | $ | 364,711 | $ | 336,535 | |||||||
Accumulated amortization | (130,354) | (123,432) | |||||||||
Deferred leasing costs and in-place lease intangibles, net | 234,357 | 213,103 | |||||||||
Below-market ground leases | 72,916 | 72,916 | |||||||||
Accumulated amortization | (10,184) | (8,932) | |||||||||
Below-market ground leases, net | 62,732 | 63,984 | |||||||||
Above-market leases | 8,047 | 8,425 | |||||||||
Accumulated amortization | (5,886) | (5,616) | |||||||||
Above-market leases, net | 2,161 | 2,809 | |||||||||
DEFERRED LEASING COSTS AND LEASE INTANGIBLE ASSETS, NET | $ | 299,250 | $ | 279,896 | |||||||
Below-market leases | $ | 91,546 | $ | 101,736 | |||||||
Accumulated amortization | (54,610) | (57,043) | |||||||||
Below-market leases, net | 36,936 | 44,693 | |||||||||
Above-market ground leases | 1,095 | 1,095 | |||||||||
Accumulated amortization | (198) | (176) | |||||||||
Above-market ground leases, net | 897 | 919 | |||||||||
LEASE INTANGIBLE LIABILITIES, NET(1) | $ | 37,833 | $ | 45,612 |
June 30, 2018 | December 31, 2017 | ||||||
Above-market leases | $ | 9,236 | $ | 18,028 | |||
Accumulated amortization | (7,122 | ) | (15,131 | ) | |||
Above-market leases, net | 2,114 | 2,897 | |||||
Deferred leasing costs and in-place lease intangibles | 288,353 | 301,945 | |||||
Accumulated amortization | (114,569 | ) | (127,703 | ) | |||
Deferred leasing costs and in-place lease intangibles, net | 173,784 | 174,242 | |||||
Below-market ground leases | 68,388 | 68,388 | |||||
Accumulated amortization | (7,704 | ) | (6,498 | ) | |||
Below-market ground leases, net | 60,684 | 61,890 | |||||
Deferred leasing costs and lease intangible assets, net(1) | $ | 236,582 | $ | 239,029 | |||
Below-market leases | $ | 91,686 | $ | 103,597 | |||
Accumulated amortization | (50,898 | ) | (55,019 | ) | |||
Below-market leases, net | 40,788 | 48,578 | |||||
Above-market ground leases | 1,095 | 1,095 | |||||
Accumulated amortization | (154 | ) | (133 | ) | |||
Above-market ground leases, net | 941 | 962 | |||||
Lease intangible liabilities, net(1) | $ | 41,729 | $ | 49,540 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Above-market leases(1) | $ | (409 | ) | $ | (1,911 | ) | $ | (883 | ) | $ | (3,267 | ) | |||
Deferred leasing costs and in-place lease intangibles(2) | (11,423 | ) | (20,644 | ) | (23,119 | ) | (40,437 | ) | |||||||
Below-market ground leases(3) | (603 | ) | (844 | ) | (1,238 | ) | (1,492 | ) | |||||||
Below-market leases(1) | 3,640 | 6,584 | 7,925 | 13,672 | |||||||||||
Above-market ground leases(3) | 11 | 11 | 22 | 22 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||||||||||||||||||||||
Deferred leasing costs and in-place lease intangibles(1) | $ | (11,311) | $ | (11,423) | $ | (23,193) | $ | (23,119) | |||||||||||||||||||||||||||
Below-market ground leases(2) | $ | (626) | $ | (603) | $ | (1,252) | $ | (1,238) | |||||||||||||||||||||||||||
Above-market leases(3) | $ | (338) | $ | (409) | $ | (648) | $ | (883) | |||||||||||||||||||||||||||
Below-market leases(3) | $ | 3,268 | $ | 3,640 | $ | 7,757 | $ | 7,925 | |||||||||||||||||||||||||||
Above-market ground leases(2) | $ | 11 | $ | 11 | $ | 22 | $ | 22 |
June 30, 2019 | December 31, 2018 | ||||||||||
Deposits for future acquisitions(1) | $ | 20,500 | $ | — | |||||||
Goodwill | 8,754 | 8,754 | |||||||||
Non-real estate investments | 4,637 | 2,713 | |||||||||
Derivative assets | 2,023 | 16,687 | |||||||||
Other | 30,160 | 27,479 | |||||||||
PREPAID EXPENSES AND OTHER ASSETS, NET(2) | $ | 66,074 | $ | 55,633 |
June 30, 2018 | December 31, 2017 | ||||||
Accounts receivable | $ | 8,833 | $ | 6,706 | |||
Allowance for doubtful accounts | (2,218 | ) | (2,472 | ) | |||
Accounts receivable, net(1) | $ | 6,615 | $ | 4,234 |
June 30, 2018 | December 31, 2017 | ||||||
Straight-line rent receivables | $ | 124,083 | $ | 106,466 | |||
Allowance for doubtful accounts | — | — | |||||
Straight-line rent receivables, net(1) | $ | 124,083 | $ | 106,466 |
June 30, 2018 | December 31, 2017 | ||||||
Derivative assets | $ | 25,485 | $ | 12,586 | |||
Investment in unconsolidated entities | 14,435 | 14,240 | |||||
Goodwill | 8,754 | 8,754 | |||||
Non-real estate investment(1) | 2,713 | 1,785 | |||||
Other | 56,162 | 23,774 | |||||
Prepaid expenses and other assets, net(2) | $ | 107,549 | $ | 61,139 |
June 30, 2018 | December 31, 2017 | Interest Rate(1) | Contractual Maturity Date | |||||||||
UNSECURED NOTES PAYABLE | ||||||||||||
Unsecured Revolving Credit Facility(2)(3) | $ | 140,000 | $ | 100,000 | LIBOR + 1.05% to 1.50% | 3/13/2022 | (4) | |||||
Term Loan A(2)(5) | 300,000 | 300,000 | LIBOR + 1.20% to 1.70% | 4/1/2020 | (6) | |||||||
Term Loan C(2) | 75,000 | 75,000 | LIBOR + 1.30% to 2.20% | 11/17/2020 | ||||||||
Term Loan B(2)(7) | 350,000 | 350,000 | LIBOR + 1.20% to 1.70% | 4/1/2022 | ||||||||
Term Loan D(2)(8) | 125,000 | 125,000 | LIBOR + 1.20% to 1.70% | 11/17/2022 | ||||||||
Series A Notes | 110,000 | 110,000 | 4.34% | 1/2/2023 | ||||||||
Series E Notes | 50,000 | 50,000 | 3.66% | 9/15/2023 | ||||||||
Series B Notes | 259,000 | 259,000 | 4.69% | 12/16/2025 | ||||||||
Series D Notes | 150,000 | 150,000 | 3.98% | 7/6/2026 | ||||||||
Registered Senior Notes(9) | 400,000 | 400,000 | 3.95% | 11/1/2027 | ||||||||
Series C Notes | 56,000 | 56,000 | 4.79% | 12/16/2027 | ||||||||
TOTAL UNSECURED NOTES PAYABLE | 2,015,000 | 1,975,000 | ||||||||||
SECURED NOTES PAYABLE | ||||||||||||
Sunset Gower Studios/Sunset Bronson Studios(10) | 5,001 | 5,001 | LIBOR + 2.25% | 3/4/2019 | (4) | |||||||
Met Park North(11) | 64,500 | 64,500 | LIBOR + 1.55% | 8/1/2020 | ||||||||
10950 Washington(12) | 27,151 | 27,418 | 5.32% | 3/11/2022 | ||||||||
Element LA | 168,000 | 168,000 | 4.59% | 11/6/2025 | ||||||||
Hill7(13) | 101,000 | 101,000 | 3.38% | 11/6/2028 | ||||||||
Rincon Center | — | 98,392 | 5.13% | N/A | ||||||||
TOTAL SECURED NOTES PAYABLE | 365,652 | 464,311 | ||||||||||
TOTAL NOTES PAYABLE | 2,380,652 | 2,439,311 | ||||||||||
Unamortized deferred financing costs and loan discounts(14) | (18,903 | ) | (17,931 | ) | ||||||||
TOTAL NOTES PAYABLE, NET | $ | 2,361,749 | $ | 2,421,380 |
June 30, 2019 | December 31, 2018 | Interest Rate(1) | Contractual Maturity Date | ||||||||||||||||||||||||||
UNSECURED AND SECURED DEBT | |||||||||||||||||||||||||||||
Unsecured debt | |||||||||||||||||||||||||||||
Unsecured revolving credit facility(2)(3) | $ | 185,000 | $ | 400,000 | LIBOR + 1.05% to 1.50% | 3/13/2022 | (4) | ||||||||||||||||||||||
Term loan A(2)(5) | 300,000 | 300,000 | LIBOR + 1.20% to 1.70% | 4/1/2020 | (6) | ||||||||||||||||||||||||
Term loan B(2)(7) | 350,000 | 350,000 | LIBOR + 1.20% to 1.70% | 4/1/2022 | |||||||||||||||||||||||||
Term loan D(2)(8) | 125,000 | 125,000 | LIBOR + 1.20% to 1.70% | 11/17/2022 | |||||||||||||||||||||||||
Series A notes | 110,000 | 110,000 | 4.34% | 1/2/2023 | |||||||||||||||||||||||||
Series E notes | 50,000 | 50,000 | 3.66% | 9/15/2023 | |||||||||||||||||||||||||
Series B notes | 259,000 | 259,000 | 4.69% | 12/16/2025 | |||||||||||||||||||||||||
Series D notes | 150,000 | 150,000 | 3.98% | 7/6/2026 | |||||||||||||||||||||||||
3.95% Registered senior notes | 400,000 | 400,000 | 3.95% | 11/1/2027 | |||||||||||||||||||||||||
Series C notes | 56,000 | 56,000 | 4.79% | 12/16/2027 | |||||||||||||||||||||||||
4.65% Registered senior notes(9) | 500,000 | — | 4.65% | 4/1/2029 | |||||||||||||||||||||||||
Term loan C | — | 75,000 | LIBOR + 1.30% to 2.20% | N/A | |||||||||||||||||||||||||
Total unsecured debt | 2,485,000 | 2,275,000 | |||||||||||||||||||||||||||
Secured debt | |||||||||||||||||||||||||||||
Met Park North(10) | 64,500 | 64,500 | LIBOR + 1.55% | 8/1/2020 | |||||||||||||||||||||||||
10950 Washington(11) | 26,598 | 26,880 | 5.32% | 3/11/2022 | |||||||||||||||||||||||||
Sunset Bronson Studios/ICON/CUE(12) | 5,001 | — | LIBOR + 1.35% | 3/1/2024 | |||||||||||||||||||||||||
Element LA | 168,000 | 168,000 | 4.59% | 11/6/2025 | |||||||||||||||||||||||||
Hill7(13) | 101,000 | 101,000 | 3.38% | 11/6/2028 | |||||||||||||||||||||||||
Sunset Gower Studios/Sunset Bronson Studios | — | 5,001 | LIBOR + 2.25% | N/A | |||||||||||||||||||||||||
Total secured debt | 365,099 | 365,381 | |||||||||||||||||||||||||||
Total unsecured and secured debt | 2,850,099 | 2,640,381 | |||||||||||||||||||||||||||
Unamortized deferred financing costs and loan discounts/premiums(14) | (15,314) | (16,546) | |||||||||||||||||||||||||||
TOTAL UNSECURED AND SECURED DEBT, NET | $ | 2,834,785 | $ | 2,623,835 | |||||||||||||||||||||||||
IN-SUBSTANCE DEFEASED DEBT(15) | $ | 136,636 | $ | 138,223 | 4.47% | 10/1/2022 | |||||||||||||||||||||||
JOINT VENTURE PARTNER DEBT(16) | $ | 66,136 | $ | 66,136 | 4.50% | 10/9/2028 | |||||||||||||||||||||||
Year | Unsecured and Secured Debt | In-substance Defeased Debt | Joint Venture Partner Debt | |||||||||||||||||
Remaining 2019 | $ | 286 | $ | 1,606 | $ | — | ||||||||||||||
2020 | 365,095 | 3,323 | — | |||||||||||||||||
2021 | 632 | 3,494 | — | |||||||||||||||||
2022 | 685,085 | 128,213 | — | |||||||||||||||||
2023 | 160,000 | — | — | |||||||||||||||||
Thereafter | 1,639,001 | — | 66,136 | |||||||||||||||||
TOTAL | $ | 2,850,099 | $ | 136,636 | $ | 66,136 |
Year | Annual Principal Payments | |||
Remaining 2018 | $ | 270 | ||
2019 | 5,569 | |||
2020 | 440,095 | |||
2021 | 632 | |||
2022 | 640,086 | |||
Thereafter | 1,294,000 | |||
Total | $ | 2,380,652 |
Issuance Date | Maturity Date | Par Value | Issuance at Par | Coupon at Offer | Effective Interest Rate | ||||||||||||||||||||||||||||||
4.65% Registered senior notes | 6/14/2019 | 4/1/2029 | $ | 150,000 | 104.544 | % | 4.65 | % | 4.12 | % | |||||||||||||||||||||||||
4.65% Registered senior notes | 2/27/2019 | 4/1/2029 | $ | 350,000 | 98.663 | % | 4.65 | % | 4.82 | % | |||||||||||||||||||||||||
3.95% Registered senior notes | 10/2/2017 | 11/1/2027 | $ | 400,000 | 99.815 | % | 3.95 | % | 3.97 | % |
June 30, 2018 | December 31, 2017 | ||||||
Outstanding borrowings | $ | 140,000 | $ | 100,000 | |||
Remaining borrowing capacity | 460,000 | 300,000 | |||||
Total borrowing capacity | $ | 600,000 | $ | 400,000 | |||
Interest rate(1)(2) | LIBOR + 1.05% to 1.50% | LIBOR + 1.15% to 1.85% | |||||
Facility fee-annual rate(1) | 0.15% or 0.30% | 0.20% or 0.35% | |||||
Contractual maturity date(3) | 3/13/2022 | 4/1/2019 |
June 30, 2019 | December 31, 2018 | ||||||||||||||||
Outstanding borrowings | $ | 185,000 | $ | 400,000 | |||||||||||||
Remaining borrowing capacity | 415,000 | 200,000 | |||||||||||||||
TOTAL BORROWING CAPACITY | $ | 600,000 | $ | 600,000 | |||||||||||||
Interest rate(1) | LIBOR + 1.05% to 1.50% | ||||||||||||||||
Annual facility fee rate(1) | 0.15% or 0.30% | ||||||||||||||||
Contractual maturity date(2) | 3/13/2022 |
Covenant Ratio | Covenant Level | Actual Performance | ||||||||||||
Total liabilities to total asset value | ≤ 60% | 37.8% | ||||||||||||
Unsecured indebtedness to unencumbered asset value | ≤ 60% | 45.0% | ||||||||||||
Adjusted EBITDA to fixed charges | ≥ 1.5x | 3.7x | ||||||||||||
Secured indebtedness to total asset value | ≤ 45% | 5.9% | ||||||||||||
Unencumbered NOI to unsecured interest expense | ≥ 2.0x | 3.5x |
Covenant Ratio | Covenant Level | Actual Performance | ||||||||||||
Debt to total assets | ≤ 60% | 38.2% | ||||||||||||
Total unencumbered assets to unsecured debt | ≥ 150% | 243.8% | ||||||||||||
Consolidated income available for debt service to annual debt service charge | ≥ 1.5x | 3.8x | ||||||||||||
Secured debt to total assets | ≤ 40% | 5.9% |
Three Months Ended June 30, | Six Months Ended June 30, | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | 2019 | 2018 | 2019 | 2018 | |||||||||||||||||||||||||||||||||||||||||||
Gross interest expense(1) | $ | 21,514 | $ | 23,047 | $ | 43,945 | $ | 46,238 | Gross interest expense(1) | $ | 28,980 | $ | 21,514 | $ | 56,445 | $ | 43,945 | |||||||||||||||||||||||||||||||||
Capitalized interest | (3,618 | ) | (2,539 | ) | (7,204 | ) | (4,986 | ) | Capitalized interest | (3,871) | (3,618) | (8,577) | (7,204) | |||||||||||||||||||||||||||||||||||||
Amortization of deferred financing costs and loan discount, net | 1,435 | 1,187 | 3,093 | 2,373 | ||||||||||||||||||||||||||||||||||||||||||||||
Interest expense | $ | 19,331 | $ | 21,695 | $ | 39,834 | $ | 43,625 | ||||||||||||||||||||||||||||||||||||||||||
Amortization of deferred financing costs and loan discounts/premiums | Amortization of deferred financing costs and loan discounts/premiums | 1,443 | 1,435 | 3,034 | 3,093 | |||||||||||||||||||||||||||||||||||||||||||||
INTEREST EXPENSE | INTEREST EXPENSE | $ | 26,552 | $ | 19,331 | $ | 50,902 | $ | 39,834 |
Interest Rate Range(1) | Fair Value Assets/(Liabilities) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Underlying Debt Instrument | Number of Hedges | Notional Amount | Effective Date | Maturity Date | Low | High | June 30, 2019 | December 31, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Met Park North | 1 | $ | 64,500 | August 2013 | August 2020 | 3.71% | 3.71% | $ | (239) | $ | 350 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Term loan A | 2 | 300,000 | July 2016 | April 2020 | 2.65% | 3.06% | 1,118 | 4,038 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Term loan B | 2 | 350,000 | April 2015 | April 2022 | 2.96% | 3.46% | (1,055) | 7,543 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Term loan D | 1 | 125,000 | June 2016 | November 2022 | 2.63% | 3.13% | 905 | 4,756 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
TOTAL | 6 | $ | 839,500 | $ | 729 | $ | 16,687 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Strike Rate Range(1) | ||||||||||||||||||
Underlying Debt Instrument | Number of Hedges | Notional Amount | Effective Date | Maturity Date | Low | High | Fair Value | |||||||||||
Met Park North | 1 | $ | 64,500 | Aug 2013 | August 2020 | 2.16% | 2.16% | $ | 586 | |||||||||
Term Loan A(2) | 2 | 300,000 | July 2016 | April 2020 | 2.56% | 3.06% | 5,818 | |||||||||||
Term Loan B(3) | 2 | 350,000 | July 2016 | April 2022 | 2.96% | 3.46% | 12,211 | |||||||||||
Term Loan D(4) | 1 | 125,000 | June 2016 | November 2022 | 2.63% | 3.13% | 6,870 |
Carrying Value | Fair Value | ||||||||||
Due in 1 year | $ | 4,842 | $ | 4,874 | |||||||
Due in 1 to 5 years | 137,919 | 141,790 | |||||||||
TOTAL | $ | 142,761 | $ | 146,664 |
Year Ended | Non-Cancellable | Subject to Early Termination Options | Total (1) | ||||||||||||||
Remaining 2019 | $ | 279,954 | $ | 2,125 | $ | 282,079 | |||||||||||
2020 | 547,430 | 15,035 | 562,465 | ||||||||||||||
2021 | 517,039 | 34,386 | 551,425 | ||||||||||||||
2022 | 472,492 | 39,722 | 512,214 | ||||||||||||||
2023 | 437,760 | 38,369 | 476,129 | ||||||||||||||
Thereafter | 2,110,308 | 87,155 | 2,197,463 | ||||||||||||||
TOTAL | $ | 4,364,983 | $ | 216,792 | $ | 4,581,775 |
Property | Expiration Date | Notes | ||||||||||||
3400 Hillview | 10/31/2040 | The ground rent is the greater of the minimum annual rent or percentage annual rent. The minimum annual rent until October 31, 2017 is the lesser of 10% of Fair Market Value (“FMV”) of the land or $1.0 million grown at 75% of the cumulative increases in consumer price index (“CPI”) from October 1989. Thereafter, minimum annual rent, which resets annually, is the lesser of 10% of FMV of the land or the minimum annual rent as calculated as of November 1, 2017 plus 75% of subsequent cumulative CPI changes. The minimum annual rent cannot be less than a set amount. Percentage annual rent is gross income multiplied by 24.125%. | ||||||||||||
Clocktower Square | 9/26/2056 | The ground rent is minimum annual rent (adjusted every 10 years) plus 25% of adjusted gross income (“AGI”). Minimum rent adjustments add 60% of the average annual participation rent payable over five years. Annual participation is the excess of 25% of AGI over the minimum annual rent for a given lease year. | ||||||||||||
Del Amo | 6/30/2049 | Rent under the ground sublease is $1.00 per year, with the sublessee being responsible for all impositions, insurance premiums, operating charges, maintenance charges, construction costs and other charges, costs and expenses that arise or may be contemplated under any provisions of the ground sublease. | ||||||||||||
Ferry Building | Various | The land on which the building is situated is subject to a ground lease agreement that expires on April 1, 2067. The minimum annual rent (adjusted every 5 years) is the prior year’s minimum annual rent plus cumulative increase in CPI with a floor of 10% and a cap of 20%. Additionally, the parking lot is subject to a separate ground lease agreement that expires on April 1, 2023. The minimum annual rent adjusts each year for changes in CPI with a floor of 2% and a cap of 4%. The parking lot is subject to automatic renewals for 10-year periods at market. | ||||||||||||
Foothill Research Center | 6/30/2039 | The ground rent is the greater of the minimum annual rent or percentage annual rent. The minimum annual rent, which resets annually, is the lesser of 10% of FMV of the land or the previous year’s minimum annual rent plus 75% of CPI increase. The minimum annual rent cannot be less than a set amount. Percentage annual rent is gross income multiplied by 24.125%. | ||||||||||||
3176 Porter | 7/31/2040 | The ground rent is the greater of the minimum annual rent or percentage annual rent. The minimum annual rent, which resets annually, is the lesser of 10% of FMV of the land or the previous year’s minimum annual rent plus 75% of CPI increase. Percentage annual rent is Lockheed’s base rent multiplied by 24.125%. The minimum annual rent cannot be less than a set amount. | ||||||||||||
Metro Center | 4/29/2054 | Every 10 years rent adjusts to 7.233% of FMV of the land (since 2008) and adjusts to reflect the change in CPI from the preceding FMV adjustment date (since 2013). The CPI adjustment has a floor of the previous minimum rent. The Company has an option to extend the ground lease for four additional periods of 11 years each. | ||||||||||||
Page Mill Center | 11/30/2041 | The ground rent is minimum annual rent (adjusted on January 1, 2019 and January 1, 2029) plus 25% of AGI, less minimum annual rent. Minimum rent adjustments adds 60% of the average annual participation rent payable over five years. Annual participation is the excess of 25% of AGI over the minimum annual rent for a given lease year. | ||||||||||||
Page Mill Hill | 11/17/2049 | The ground rent is minimum annual rent (adjusted every 10 years) plus 60% of the average of the percentage annual rent for the previous 7 lease years. Minimum rent adjustments add 60% of the average annual percentage rent for the previous 7 years. | ||||||||||||
Palo Alto Square | 11/30/2045 | The ground rent is minimum annual rent (adjusted every 10 years starting January 1, 2022) plus 25% of AGI less minimum annual rent. The minimum annual rent adjustments add 50% of the average annual percentage rent from the previous 5 years. | ||||||||||||
Sunset Gower Studios | 3/31/2060 | Every 7 years rent adjusts to 7.5% of FMV of the land. | ||||||||||||
Techmart | 5/31/2053 | Rent subject to a 10% increase every 5 years. The Company has an option to extend the ground lease for two additional periods of 10 years each. This extension option was not included in the calculation of the right of use asset and lease liability. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||||||||||||||||||||||
Contingent rental expense | $ | 2,977 | $ | 2,453 | $ | 5,491 | $ | 5,548 | |||||||||||||||||||||||||||
Minimum rental expense | $ | 4,606 | $ | 4,136 | $ | 9,209 | $ | 7,473 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Contingent rental expense | $ | 2,453 | $ | 1,650 | $ | 5,548 | $ | 3,834 | |||||||
Minimum rental expense | 4,136 | 3,055 | 7,473 | 6,251 |
Year | Ground Leases(1) | Year | Lease Payments(1) | |||||||||
Remaining 2018 | $ | 7,908 | ||||||||||
2019 | 15,815 | |||||||||||
Remaining 2019 | Remaining 2019 | $ | 9,211 | |||||||||
2020 | 15,815 | 2020 | 18,422 | |||||||||
2021 | 15,815 | 2021 | 18,422 | |||||||||
2022 | 15,815 | 2022 | 18,422 | |||||||||
2023 | 2023 | 18,499 | ||||||||||
Thereafter | 436,791 | Thereafter | 501,926 | |||||||||
Total | $ | 507,959 | ||||||||||
TOTAL | TOTAL | $ | 584,902 |
June 30, 2018 | December 31, 2017 | |||||||||||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||||
Derivative assets(1) | $ | — | $ | 25,485 | $ | — | $ | 25,485 | $ | — | $ | 12,586 | $ | — | $ | 12,586 | ||||||||||||||||
Derivative liabilities | — | — | — | — | — | 265 | — | 265 | ||||||||||||||||||||||||
Non-real estate investment(1)(2) | — | 2,713 | — | 2,713 | — | — | — | — |
June 30, 2019 | December 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative assets(1) | $ | — | $ | 2,023 | $ | — | $ | 2,023 | $ | — | $ | 16,687 | $ | — | $ | 16,687 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative liabilities(2) | $ | — | $ | (1,294) | $ | — | $ | (1,294) | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Non-real estate investments(1) | $ | — | $ | 4,637 | $ | — | $ | 4,637 | $ | — | $ | 2,713 | $ | — | $ | 2,713 |
June 30, 2018 | December 31, 2017 | |||||||||||||
Carrying Value | Fair Value | Carrying Value | Fair Value | |||||||||||
Unsecured notes payable(1)(2) | $ | 2,014,315 | $ | 1,968,163 | 1,974,278 | $ | 1,960,560 | |||||||
Secured notes payable | 365,652 | 357,092 | 464,311 | 458,441 |
June 30, 2019 | December 31, 2018 | ||||||||||||||||||||||||||||||||||
Carrying Value | Fair Value | Carrying Value | Fair Value | ||||||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||||||||
U.S. Government securities | $ | 142,761 | $ | 146,664 | $ | 146,880 | $ | 147,686 | |||||||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||||||||
Unsecured debt(1)(2) | $ | 2,487,709 | $ | 2,527,147 | $ | 2,274,352 | $ | 2,227,265 | |||||||||||||||||||||||||||
Secured debt(1) | $ | 365,099 | $ | 360,795 | $ | 365,381 | $ | 354,109 | |||||||||||||||||||||||||||
In-substance defeased debt | $ | 136,636 | $ | 136,532 | $ | 138,223 | $ | 135,894 | |||||||||||||||||||||||||||
Joint venture partner debt | $ | 66,136 | $ | 68,654 | $ | 66,136 | $ | 66,136 |
Assumption | |||||
Expected price volatility for the Company | |||||
Expected price volatility for the particular REIT index | 18.00% | ||||
Risk-free rate | |||||
Dividend yield |
Three Months Ended June 30, | Six Months Ended June 30, | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | 2019 | 2018 | 2019 | 2018 | |||||||||||||||||||||||||||||||||||||||||||
Expensed stock compensation(1) | $ | 4,289 | $ | 3,886 | $ | 8,627 | $ | 7,788 | Expensed stock compensation(1) | $ | 5,067 | $ | 4,289 | $ | 10,217 | $ | 8,627 | |||||||||||||||||||||||||||||||||
Capitalized stock compensation(2) | 288 | 219 | 520 | 418 | Capitalized stock compensation(2) | 35 | 288 | 64 | 520 | |||||||||||||||||||||||||||||||||||||||||
Total stock compensation(3) | $ | 4,577 | $ | 4,105 | $ | 9,147 | $ | 8,206 | ||||||||||||||||||||||||||||||||||||||||||
TOTAL STOCK COMPENSATION(3) | TOTAL STOCK COMPENSATION(3) | $ | 5,102 | $ | 4,577 | $ | 10,281 | $ | 9,147 |
Three Months Ended June 30, | Six Months Ended June 30, | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | 2019 | 2018 | 2019 | 2018 | |||||||||||||||||||||||||||||||||||||||||||
Numerator: | Numerator: | |||||||||||||||||||||||||||||||||||||||||||||||||
Basic and diluted net income available to common stockholders | $ | 16,202 | $ | 3,553 | $ | 64,779 | $ | 24,068 | ||||||||||||||||||||||||||||||||||||||||||
Basic and diluted net income (loss) available to common stockholders | Basic and diluted net income (loss) available to common stockholders | $ | 9,786 | $ | 16,202 | $ | (29,606) | $ | 64,779 | |||||||||||||||||||||||||||||||||||||||||
Denominator: | Denominator: | |||||||||||||||||||||||||||||||||||||||||||||||||
Basic weighted average common shares outstanding | 155,636,636 | 155,290,559 | 155,631,375 | 151,640,853 | Basic weighted average common shares outstanding | 154,384,586 | 155,636,636 | 154,390,340 | 155,631,375 | |||||||||||||||||||||||||||||||||||||||||
Effect of dilutive instruments(1) | 953,591 | 805,044 | 932,591 | 791,044 | Effect of dilutive instruments(1) | 302,675 | 953,591 | — | 932,591 | |||||||||||||||||||||||||||||||||||||||||
Diluted weighted average common shares outstanding | 156,590,227 | 156,095,603 | 156,563,966 | 152,431,897 | ||||||||||||||||||||||||||||||||||||||||||||||
Basic earnings per common share | $ | 0.10 | $ | 0.02 | $ | 0.42 | $ | 0.16 | ||||||||||||||||||||||||||||||||||||||||||
Diluted earnings per common share | $ | 0.10 | $ | 0.02 | $ | 0.41 | $ | 0.16 | ||||||||||||||||||||||||||||||||||||||||||
DILUTED WEIGHTED AVERAGE COMMON SHARES OUTSTANDING | DILUTED WEIGHTED AVERAGE COMMON SHARES OUTSTANDING | 154,687,261 | 156,590,227 | 154,390,340 | 156,563,966 | |||||||||||||||||||||||||||||||||||||||||||||
Basic earnings (loss) per common share | Basic earnings (loss) per common share | $ | 0.06 | $ | 0.10 | $ | (0.19) | $ | 0.42 | |||||||||||||||||||||||||||||||||||||||||
Diluted earnings (loss) per common share | Diluted earnings (loss) per common share | $ | 0.06 | $ | 0.10 | $ | (0.19) | $ | 0.41 |
Three Months Ended June 30, | Six Months Ended June 30, | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | 2019 | 2018 | 2019 | 2018 | |||||||||||||||||||||||||||||||||||||||||||
Numerator: | Numerator: | |||||||||||||||||||||||||||||||||||||||||||||||||
Basic and diluted net income available to common unitholders | $ | 16,261 | $ | 3,566 | $ | 65,015 | $ | 24,283 | ||||||||||||||||||||||||||||||||||||||||||
Basic and diluted net income (loss) available to common unitholders | Basic and diluted net income (loss) available to common unitholders | $ | 9,863 | $ | 16,261 | $ | (29,714) | $ | 65,015 | |||||||||||||||||||||||||||||||||||||||||
Denominator: | Denominator: | |||||||||||||||||||||||||||||||||||||||||||||||||
Basic weighted average common units outstanding | 156,205,681 | 155,859,604 | 156,198,825 | 152,647,055 | Basic weighted average common units outstanding | 155,105,359 | 156,205,681 | 155,047,979 | 156,198,825 | |||||||||||||||||||||||||||||||||||||||||
Effect of dilutive instruments(1) | 953,591 | 805,044 | 932,591 | 791,045 | Effect of dilutive instruments(1) | 1,069,645 | 953,591 | — | 932,591 | |||||||||||||||||||||||||||||||||||||||||
Diluted weighted average common units outstanding | 157,159,272 | 156,664,648 | 157,131,416 | 153,438,100 | ||||||||||||||||||||||||||||||||||||||||||||||
Basic earnings per common unit | $ | 0.10 | $ | 0.02 | $ | 0.42 | $ | 0.16 | ||||||||||||||||||||||||||||||||||||||||||
Diluted earnings per common unit | $ | 0.10 | $ | 0.02 | $ | 0.41 | $ | 0.16 | ||||||||||||||||||||||||||||||||||||||||||
DILUTED WEIGHTED AVERAGE COMMON UNITS OUTSTANDING | DILUTED WEIGHTED AVERAGE COMMON UNITS OUTSTANDING | $ | 156,175,004 | $ | 157,159,272 | $ | 155,047,979 | $ | 157,131,416 | |||||||||||||||||||||||||||||||||||||||||
Basic earnings (loss) per common unit | Basic earnings (loss) per common unit | $ | 0.06 | $ | 0.10 | $ | (0.19) | $ | 0.42 | |||||||||||||||||||||||||||||||||||||||||
Diluted earnings (loss) per common unit | Diluted earnings (loss) per common unit | $ | 0.06 | $ | 0.10 | $ | (0.19) | $ | 0.41 |
Series A Redeemable Preferred Units | Consolidated Entities | |||||||||||||
Balance at December 31, 2018 | $ | 9,815 | $ | 113,141 | ||||||||||
Contributions | — | 2,941 | ||||||||||||
Distributions | — | (7) | ||||||||||||
Declared dividend | (306) | — | ||||||||||||
Net income (loss) | 306 | (1,158) | ||||||||||||
BALANCE AT JUNE 30, 2019 | $ | 9,815 | $ | 114,917 |
Hudson Pacific Properties, Inc. Stockholders’ Equity | Non-controlling Interests | Total Equity | ||||||||||
Balance at January 1, 2018 | $ | 13,227 | $ | 49 | $ | 13,276 | ||||||
Unrealized gain recognized in OCI due to change in fair value | 13,676 | 50 | 13,726 | |||||||||
Income reclassified from OCI into income (as interest expense) | (726 | ) | (3 | ) | (729 | ) | ||||||
Net change in OCI | 12,950 | 47 | 12,997 | |||||||||
Cumulative adjustment related to adoption of ASU 2017-12 | 230 | 1 | 231 | |||||||||
Balance at June 30, 2018 | $ | 26,407 | $ | 97 | $ | 26,504 |
Derivative Instruments | Currency Translation Adjustments | Total Equity | ||||||||||||||||||
Balance at December 31, 2018 | $ | 17,501 | $ | — | $ | 17,501 | ||||||||||||||
Unrealized (losses) gains recognized in OCI | (13,801) | 1,304 | (12,497) | |||||||||||||||||
Reclassification adjustment for realized gains(1) | (3,725) | — | (3,725) | |||||||||||||||||
Net change in OCI | (17,526) | 1,304 | (16,222) | |||||||||||||||||
BALANCE AT JUNE 30, 2019 | $ | (25) | $ | 1,304 | $ | 1,279 |
Derivative Instruments | Currency Translation Adjustments | Total Capital | ||||||||||||||||||
Balance at December 31, 2018 | $ | 17,565 | $ | — | $ | 17,565 | ||||||||||||||
Unrealized (losses) gains recognized in OCI | (13,891) | 1,315 | (12,576) | |||||||||||||||||
Reclassification adjustment for realized gains(1) | (3,748) | — | (3,748) | |||||||||||||||||
Net change in OCI | (17,639) | 1,315 | (16,324) | |||||||||||||||||
BALANCE AT JUNE 30, 2019 | $ | (74) | $ | 1,315 | $ | 1,241 |
June 30, 2018 | December 31, 2017 | ||||
Company-owned common units in the operating partnership | 155,647,733 | 155,602,508 | |||
Company’s ownership interest percentage | 99.6 | % | 99.6 | % | |
Non-controlling common units in the operating partnership(1) | 569,045 | 569,045 | |||
Non-controlling ownership interest percentage(1) | 0.4 | % | 0.4 | % |
June 30, 2019 | December 31, 2018 | ||||||||||
Company-owned common units in the operating partnership | 154,396,755 | 154,371,538 | |||||||||
Company’s ownership interest percentage | 99.5 | % | 99.6 | % | |||||||
Non-controlling units in the operating partnership(1) | 720,773 | 569,045 | |||||||||
Non-controlling ownership interest percentage | 0.5 | % | 0.4 | % |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||||||||||||||||||||||
Common stock | $ | 0.25 | $ | 0.25 | $ | 0.50 | $ | 0.50 | |||||||||||||||||||||||||||
Common units | $ | 0.25 | $ | 0.25 | $ | 0.50 | $ | 0.50 | |||||||||||||||||||||||||||
Series A preferred units | $ | 0.3906 | $ | 0.3906 | $ | 0.7812 | $ | 0.7812 | |||||||||||||||||||||||||||
Performance units | $ | 0.25 | $ | 0.25 | $ | 0.50 | $ | 0.50 | |||||||||||||||||||||||||||
Payment date | June 27, 2019 | June 29, 2018 | N/A | N/A | |||||||||||||||||||||||||||||||
Record date | June 17, 2019 | June 19, 2018 | N/A | N/A |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||||||||||||||||||||||
Office segment | |||||||||||||||||||||||||||||||||||
Office revenues | $ | 179,047 | $ | 158,550 | $ | 354,905 | $ | 315,082 | |||||||||||||||||||||||||||
Office expenses | (60,896) | (53,940) | (121,711) | (107,180) | |||||||||||||||||||||||||||||||
Office segment profit | 118,151 | 104,610 | 233,194 | 207,902 | |||||||||||||||||||||||||||||||
Studio segment | |||||||||||||||||||||||||||||||||||
Studio revenues | 17,609 | 16,619 | 39,140 | 34,205 | |||||||||||||||||||||||||||||||
Studio expenses | (9,539) | (8,539) | (20,648) | (18,203) | |||||||||||||||||||||||||||||||
Studio segment profit | 8,070 | 8,080 | 18,492 | 16,002 | |||||||||||||||||||||||||||||||
TOTAL SEGMENT PROFIT | $ | 126,221 | $ | 112,690 | $ | 251,686 | $ | 223,904 | |||||||||||||||||||||||||||
Segment revenues | $ | 196,656 | $ | 175,169 | $ | 394,045 | $ | 349,287 | |||||||||||||||||||||||||||
Segment expenses | (70,435) | (62,479) | (142,359) | (125,383) | |||||||||||||||||||||||||||||||
TOTAL SEGMENT PROFIT | $ | 126,221 | $ | 112,690 | $ | 251,686 | $ | 223,904 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||||||||||||||||||||||
Total profit from all segments | $ | 126,221 | $ | 112,690 | $ | 251,686 | $ | 223,904 | |||||||||||||||||||||||||||
General and administrative | (18,344) | (16,203) | (36,438) | (31,767) | |||||||||||||||||||||||||||||||
Depreciation and amortization | (69,606) | (60,706) | (138,111) | (121,259) | |||||||||||||||||||||||||||||||
Loss from unconsolidated real estate investments | (85) | — | (85) | — | |||||||||||||||||||||||||||||||
Interest expense | (26,552) | (19,331) | (50,902) | (39,834) | |||||||||||||||||||||||||||||||
Interest income | 1,008 | 66 | 2,032 | 75 | |||||||||||||||||||||||||||||||
Transaction-related expenses | — | — | (128) | (118) | |||||||||||||||||||||||||||||||
Other income | 181 | 319 | 75 | 723 | |||||||||||||||||||||||||||||||
Unrealized gain on non-real estate investment | — | 928 | — | 928 | |||||||||||||||||||||||||||||||
Gains on sale of real estate | — | 1,928 | — | 39,602 | |||||||||||||||||||||||||||||||
Impairment loss | — | — | (52,201) | — | |||||||||||||||||||||||||||||||
NET INCOME (LOSS) | $ | 12,823 | $ | 19,691 | $ | (24,072) | $ | 72,254 |
Six Months Ended June 30, | |||||||||||||||||
2019 | 2018 | ||||||||||||||||
Cash paid for interest, net of capitalized interest | $ | 42,643 | $ | 39,042 | |||||||||||||
Non-cash investing and financing activities | |||||||||||||||||
Accounts payable and accrued liabilities for real estate investments | $ | (9,564) | $ | (2,460) |
Six Months Ended June 30, | |||||||||||||||||
2019 | 2018 | ||||||||||||||||
Beginning of period: | |||||||||||||||||
Cash and cash equivalents | $ | 53,740 | $ | 78,922 | |||||||||||||
Restricted cash | 14,451 | 22,358 | |||||||||||||||
TOTAL | $ | 68,191 | $ | 101,280 | |||||||||||||
End of period: | |||||||||||||||||
Cash and cash equivalents | $ | 48,172 | $ | 57,515 | |||||||||||||
Restricted cash | 13,375 | 8,472 | |||||||||||||||
TOTAL | $ | 61,547 | $ | 65,987 |
Six Months Ended June 30, | |||||||
2018 | 2017 | ||||||
Beginning of period: | |||||||
Cash and cash equivalents | $ | 78,922 | $ | 83,015 | |||
Restricted cash | 22,358 | 25,177 | |||||
Total | $ | 101,280 | $ | 108,192 | |||
End of period: | |||||||
Cash and cash equivalents | $ | 57,515 | $ | 73,242 | |||
Restricted cash | 8,472 | 17,284 | |||||
Total | $ | 65,987 | $ | 90,526 |
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
In-Service Portfolio | Number of Buildings | Rentable Square Feet(1) | Percent Occupied(2) | Percent Leased(3) | Annualized Base Rent per Square Foot(4) | ||||||||||||||||||||||||||||||
Office | |||||||||||||||||||||||||||||||||||
Same-store(5) | 32 | 7,886,740 | 95.1 | % | 96.0 | % | $ | 48.94 | |||||||||||||||||||||||||||
Stabilized non-same store(6) | 9 | 2,645,040 | 96.9 | % | 97.8 | % | $ | 53.12 | |||||||||||||||||||||||||||
Total stabilized | 41 | 10,531,780 | 95.6 | % | 96.4 | % | $ | 50.00 | |||||||||||||||||||||||||||
Lease-up(6)(7) | 7 | 1,871,220 | 70.5 | % | 80.8 | % | $ | 50.52 | |||||||||||||||||||||||||||
Total in-service | 48 | 12,403,000 | 91.8 | % | 94.1 | % | $ | 50.06 | |||||||||||||||||||||||||||
Redevelopment(6) | 1 | 584,000 | 100.0 | % | |||||||||||||||||||||||||||||||
Development(6) | 2 | 408,227 | 74.0 | % | |||||||||||||||||||||||||||||||
Held for sale(6) | 1 | 471,580 | — | % | |||||||||||||||||||||||||||||||
Total office | 52 | 13,866,807 | |||||||||||||||||||||||||||||||||
Studio | |||||||||||||||||||||||||||||||||||
Same-store(8) | 3 | 1,171,707 | 92.6 | % | $ | 39.21 | |||||||||||||||||||||||||||||
Non-same-store(9) | — | 52,696 | 100.0 | % | $ | 40.07 | |||||||||||||||||||||||||||||
Total studio | 3 | 1,224,403 | |||||||||||||||||||||||||||||||||
Land | — | 3,177,726 | (10)(11) | ||||||||||||||||||||||||||||||||
TOTAL | 55 | 18,268,936 |
Location | Submarket | Estimated Square Feet(1) | Estimated Completion Date | Estimated Stabilization Date | ||||||||||||||||||||||||||||
Redevelopment: | ||||||||||||||||||||||||||||||||
One Westside | West Los Angeles | 584,000 | Q1-2022 | Q2-2023 | ||||||||||||||||||||||||||||
Total redevelopment | 584,000 | |||||||||||||||||||||||||||||||
Development: | ||||||||||||||||||||||||||||||||
EPIC | Hollywood | 302,102 | Q4-2019 | Q3-2021 | ||||||||||||||||||||||||||||
Harlow | Hollywood | 106,125 | Q1-2020 | Q3-2021 | ||||||||||||||||||||||||||||
Total development | 408,227 | |||||||||||||||||||||||||||||||
TOTAL REDEVELOPMENT AND DEVELOPMENT | 992,227 | |||||||||||||||||||||||||||||||
Future Redevelopment and development: | ||||||||||||||||||||||||||||||||
Washington 1000 | Denny Triangle | 538,164 | TBD | TBD | ||||||||||||||||||||||||||||
Element LA—Development | West Los Angeles | 500,000 | TBD | TBD | ||||||||||||||||||||||||||||
Sunset Bronson Studios Lot D—Development | Hollywood | 19,816 | TBD | TBD | ||||||||||||||||||||||||||||
Sunset Gower Studios—Development | Hollywood | 423,396 | TBD | TBD | ||||||||||||||||||||||||||||
Sunset Las Palmas Studios—Development | Hollywood | 400,000 | TBD | TBD | ||||||||||||||||||||||||||||
Cloud10 | North San Jose | 350,000 | TBD | TBD | ||||||||||||||||||||||||||||
TOTAL FUTURE REDEVELOPMENT AND DEVELOPMENT | 2,231,376 |
Year of Lease Expiration | Expiring Leases | Square Footage of Expiring Leases | Percentage of Office Portfolio Square Feet | Annualized Base Rent(1) | Percentage of Office Portfolio Annualized Base Rent | Annualized Base Rent Per Leased Square Foot(2) | ||||||||||||||||||||||||||||||||
Vacant | N/A | 1,314,314 | 9.5 | % | N/A | N/A | N/A | |||||||||||||||||||||||||||||||
2019(3) | 84 | 683,597 | 5.0 | $ | 33,058,119 | 5.6 | % | $ | 48.36 | |||||||||||||||||||||||||||||
2020 | 150 | 905,452 | 6.6 | 44,634,378 | 7.6 | 49.30 | ||||||||||||||||||||||||||||||||
2021 | 135 | 1,278,398 | 9.2 | 58,754,494 | 10.0 | 45.96 | ||||||||||||||||||||||||||||||||
2022 | 133 | 1,259,614 | 9.1 | 60,395,352 | 10.2 | 47.95 | ||||||||||||||||||||||||||||||||
2023 | 86 | 1,538,138 | 11.1 | 58,294,988 | 9.9 | 37.90 | ||||||||||||||||||||||||||||||||
2024 | 93 | 1,487,257 | 10.8 | 71,634,235 | 12.2 | 48.17 | ||||||||||||||||||||||||||||||||
2025 | 36 | 1,173,644 | 8.5 | 48,817,140 | 8.3 | 41.59 | ||||||||||||||||||||||||||||||||
2026 | 18 | 333,758 | 2.4 | 18,109,269 | 3.1 | 54.26 | ||||||||||||||||||||||||||||||||
2027 | 16 | 455,076 | 3.3 | 21,877,687 | 3.7 | 48.07 | ||||||||||||||||||||||||||||||||
2028 | 17 | 555,792 | 4.0 | 34,495,313 | 5.9 | 62.07 | ||||||||||||||||||||||||||||||||
Thereafter | 30 | 1,526,827 | 11.0 | 79,108,481 | 13.4 | 51.81 | ||||||||||||||||||||||||||||||||
Building management use | 22 | 149,812 | 1.1 | — | — | — | ||||||||||||||||||||||||||||||||
Signed leases not commenced(4) | 22 | 1,166,450 | 8.4 | 60,188,877 | 10.2 | 51.60 | ||||||||||||||||||||||||||||||||
TOTAL/WEIGHTED AVERAGE | 842 | 13,828,129 | 100.0 | % | $ | 589,368,333 | 100.0 | % | $ | 47.10 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||||||||||||||||||||||||
Renewals(1) | ||||||||||||||||||||||||||||||||||||||
Number of leases | 37 | 25 | 53 | 44 | ||||||||||||||||||||||||||||||||||
Square feet | 181,221 | 372,629 | 278,344 | 675,030 | ||||||||||||||||||||||||||||||||||
Tenant improvement costs per square foot(2)(3) | $ | 12.75 | $ | 9.98 | $ | 11.18 | $ | 25.36 | ||||||||||||||||||||||||||||||
Leasing commission costs per square foot(2) | 8.87 | 9.31 | 8.54 | 11.46 | ||||||||||||||||||||||||||||||||||
Total tenant improvement and leasing commission costs(2) | $ | 21.62 | $ | 19.29 | $ | 19.72 | $ | 36.82 | ||||||||||||||||||||||||||||||
New leases(4) | ||||||||||||||||||||||||||||||||||||||
Number of leases | 33 | 44 | 62 | 80 | ||||||||||||||||||||||||||||||||||
Square feet | 263,506 | 430,989 | 1,210,519 | 684,844 | ||||||||||||||||||||||||||||||||||
Tenant improvement costs per square foot(2)(3) | $ | 52.73 | $ | 37.60 | $ | 83.90 | $ | 41.07 | ||||||||||||||||||||||||||||||
Leasing commission costs per square foot(2) | 12.53 | 13.22 | 29.00 | 13.70 | ||||||||||||||||||||||||||||||||||
Total tenant improvement and leasing commission costs(2) | $ | 65.26 | $ | 50.82 | $ | 112.90 | $ | 54.77 | ||||||||||||||||||||||||||||||
TOTAL | ||||||||||||||||||||||||||||||||||||||
Number of leases | 70 | 69 | 115 | 124 | ||||||||||||||||||||||||||||||||||
Square feet | 444,727 | 803,618 | 1,488,863 | 1,359,874 | ||||||||||||||||||||||||||||||||||
Tenant improvement costs per square foot(2)(3) | $ | 36.44 | $ | 24.80 | $ | 70.31 | $ | 33.27 | ||||||||||||||||||||||||||||||
Leasing commission costs per square foot(2) | 11.04 | 11.40 | 25.17 | 12.59 | ||||||||||||||||||||||||||||||||||
TOTAL TENANT IMPROVEMENT AND LEASING COMMISSION COSTS(2) | $ | 47.48 | $ | 36.20 | $ | 95.48 | $ | 45.86 |
Properties | Acquisition Date | Acquisition/Estimated Rentable Square Feet | Consideration Paid (in thousands) | ||||||
Acquired properties: | |||||||||
875 Howard | 2/15/2007 | 286,270 | $ | — | |||||
Sunset Gower Studios | 8/17/2007 | 545,673 | — | ||||||
6040 Sunset(1) | 8/17/2007 | 114,958 | — | ||||||
Sunset Bronson Studios | 1/30/2008 | 308,026 | — | ||||||
Del Amo | 8/13/2010 | 113,000 | 27,327 | ||||||
1455 Market(2) | 12/16/2010 | 1,025,833 | 92,365 | ||||||
Rincon Center | 12/16/2010 | 580,850 | 184,571 | ||||||
10950 Washington | 12/22/2010 | 159,024 | 46,409 | ||||||
604 Arizona | 7/26/2011 | 44,260 | 21,373 | ||||||
275 Brannan | 8/19/2011 | 54,673 | 12,370 | ||||||
625 Second | 9/1/2011 | 138,080 | 57,119 | ||||||
6922 Hollywood | 11/22/2011 | 205,523 | 92,802 | ||||||
6050 Sunset & 1445 N. Beachwood | 12/16/2011 | 20,032 | 6,502 | ||||||
10900 Washington | 4/5/2012 | 9,919 | 2,605 | ||||||
901 Market | 6/1/2012 | 206,199 | 90,871 | ||||||
Element LA (includes 1861 Bundy) | 9/5/2012 & 9/23/2013 | 284,037 | 99,936 | ||||||
1455 Gordon | 9/21/2012 | 5,921 | 2,385 | ||||||
3401 Exposition | 5/22/2013 | 63,376 | 25,722 | ||||||
Seattle Portfolio (83 King, 505 First, Met Park North and Northview Center) | 7/31/2013 | 844,980 | 368,389 | ||||||
Merrill Place | 2/12/2014 | 193,153 | 57,034 | ||||||
EOP Northern California Portfolio (see table on next page for property list) | 4/1/2015 | 6,814,621 | 3,282,971 | ||||||
Fourth & Traction(3) | 5/22/2015 | 120,937 | 49,250 | ||||||
MaxWell(4) | 8/17/2015 | 83,285 | 40,000 | ||||||
11601 Wilshire(5) | 7/1/2016 & 6/15/2017 | 500,475 | 361,000 | ||||||
Hill7(6) | 10/7/2016 | 285,680 | 179,800 | ||||||
Page Mill Hill | 12/12/2016 | 182,676 | 150,000 | ||||||
Sunset Las Palmas Studios (includes 6666 Santa Monica, 6605 Eleanor and 1034 Seward) | 5/1/2017 & 6/29/2017 & 6/7/2018 | 414,646 | 233,150 | ||||||
Development properties(7): | |||||||||
ICON(8) | N/A | 325,757 | N/A | ||||||
450 Alaskan(9) | N/A | 170,974 | N/A | ||||||
CUE(10) | N/A | 91,953 | N/A | ||||||
95 Jackson(11) | N/A | 31,659 | N/A | ||||||
EPIC(12) | N/A | 300,000 | N/A | ||||||
Harlow(13) | N/A | 106,125 | N/A | ||||||
Total | 14,632,575 | $ | 5,483,951 |
Properties | Disposition Date | Approximate Square Feet | Sales Price(1) (in millions) | ||||||
City Plaza | 7/12/2013 | 333,922 | $ | 56.0 | |||||
Tierrasanta | 7/16/2014 | 112,300 | 19.5 | ||||||
First Financial | 3/6/2015 | 223,679 | 89.0 | ||||||
Bay Park Plaza | 9/29/2015 | 260,183 | 90.0 | ||||||
Bayhill Office Center | 1/14/2016 | 554,328 | 215.0 | ||||||
Patrick Henry Drive | 4/7/2016 | 70,520 | 19.0 | ||||||
One Bay Plaza | 6/1/2016 | 195,739 | 53.4 | ||||||
12655 Jefferson | 11/4/2016 | 100,756 | 80.0 | ||||||
222 Kearny | 2/14/2017 | 148,797 | 51.8 | ||||||
3402 Pico | 3/21/2017 | 50,687 | 35.0 | ||||||
Pinnacle I and Pinnacle II(2) | 11/16/2017 | 623,777 | 350.0 | ||||||
Embarcadero Place | 1/25/2018 | 197,402 | 136.0 | ||||||
2600 Campus Drive (building 6 of Peninsula Office Park) | 1/31/2018 | 63,050 | 22.5 | ||||||
2180 Sand Hill | 3/1/2018 | 45,613 | 82.5 | ||||||
9300 Wilshire | 4/10/2018 | 61,422 | 13.8 | ||||||
Total(3)(4)(5) | 3,042,175 | $ | 1,313.5 |
Three Months Ended June 30, | Dollar Change | Percent Change | |||||||||||||||||||||||||||
2019 | 2018 | ||||||||||||||||||||||||||||
Net income | $ | 12,823 | $ | 19,691 | $ | (6,868) | (34.9) | % | |||||||||||||||||||||
Adjustments: | |||||||||||||||||||||||||||||
Loss from unconsolidated real estate investments | 85 | — | 85 | 100.0 | |||||||||||||||||||||||||
Interest expense | 26,552 | 19,331 | 7,221 | 37.4 | |||||||||||||||||||||||||
Interest income | (1,008) | (66) | (942) | 1,427.3 | |||||||||||||||||||||||||
Other income | (181) | (319) | 138 | (43.3) | |||||||||||||||||||||||||
Unrealized gain on non-real estate investment | — | (928) | 928 | (100.0) | |||||||||||||||||||||||||
Gains on sale of real estate | — | (1,928) | 1,928 | (100.0) | |||||||||||||||||||||||||
General and administrative | 18,344 | 16,203 | 2,141 | 13.2 | |||||||||||||||||||||||||
Depreciation and amortization | 69,606 | 60,706 | 8,900 | 14.7 | |||||||||||||||||||||||||
NOI | $ | 126,221 | $ | 112,690 | $ | 13,531 | 12.0 | % | |||||||||||||||||||||
Same-store NOI | $ | 91,839 | $ | 82,978 | $ | 8,861 | 10.7 | % | |||||||||||||||||||||
Non-same-store NOI | 34,382 | 29,712 | 4,670 | 15.7 | |||||||||||||||||||||||||
NOI | $ | 126,221 | $ | 112,690 | $ | 13,531 | 12.0 | % |
Three Months Ended June 30, | Dollar Change | Percent Change | ||||||||||||
2018 | 2017 | |||||||||||||
Net income | $ | 19,691 | $ | 6,954 | $ | 12,737 | 183.2 | % | ||||||
Adjustments: | ||||||||||||||
Interest expense | 19,331 | 21,695 | (2,364 | ) | (10.9 | ) | ||||||||
Interest income | (66 | ) | (16 | ) | (50 | ) | 312.5 | |||||||
Unrealized loss on ineffective portion of derivatives | — | 51 | (51 | ) | (100.0 | ) | ||||||||
Unrealized gain on non-real estate investment | (928 | ) | — | (928 | ) | (100.0 | ) | |||||||
Other income | (319 | ) | (576 | ) | 257 | (44.6 | ) | |||||||
Gains on sale of real estate | (1,928 | ) | — | (1,928 | ) | (100.0 | ) | |||||||
Income from operations | 35,781 | 28,108 | 7,673 | 27.3 | ||||||||||
Adjustments: | ||||||||||||||
General and administrative | 16,203 | 14,506 | 1,697 | 11.7 | ||||||||||
Depreciation and amortization | 60,706 | 75,415 | (14,709 | ) | (19.5 | ) | ||||||||
NOI | $ | 112,690 | $ | 118,029 | $ | (5,339 | ) | (4.5 | )% | |||||
Same-Store NOI | $ | 75,348 | $ | 73,550 | $ | 1,798 | 2.4 | % | ||||||
Non-Same-Store NOI | 37,342 | 44,479 | (7,137 | ) | (16.0 | ) | ||||||||
NOI | $ | 112,690 | $ | 118,029 | $ | (5,339 | ) | (4.5 | )% |
Three Months Ended June 30, | |||||||||||||||||
2019 | 2018 | ||||||||||||||||
Revenues | |||||||||||||||||
Office | |||||||||||||||||
Rental | $ | 172,256 | $ | 129,732 | |||||||||||||
Tenant recoveries | — | 21,960 | |||||||||||||||
Service revenues | 6,791 | 6,858 | |||||||||||||||
Total office revenues | 179,047 | 158,550 | |||||||||||||||
Studio | |||||||||||||||||
Rental | 14,521 | 10,708 | |||||||||||||||
Tenant recoveries | — | 500 | |||||||||||||||
Service revenues and other | 3,088 | 5,411 | |||||||||||||||
Total studio revenues | 17,609 | 16,619 | |||||||||||||||
TOTAL REVENUES | $ | 196,656 | $ | 175,169 |
Three Months Ended June 30, | |||||||||||||||||
2019 | 2018 | ||||||||||||||||
Revenues | |||||||||||||||||
Office | |||||||||||||||||
Rental | $ | 146,637 | $ | 129,732 | |||||||||||||
Tenant recoveries | 25,619 | 21,960 | |||||||||||||||
Service revenues | 6,791 | 6,858 | |||||||||||||||
Total office revenues | 179,047 | 158,550 | |||||||||||||||
Studio | |||||||||||||||||
Rental | 13,163 | 10,708 | |||||||||||||||
Tenant recoveries | 1,358 | 500 | |||||||||||||||
Service revenues and other | 3,088 | 5,411 | |||||||||||||||
Total studio revenues | 17,609 | 16,619 | |||||||||||||||
TOTAL REVENUES | $ | 196,656 | $ | 175,169 |
Three Months Ended June 30, | |||||||||||||||||
2019 | 2018 | ||||||||||||||||
Same-store office | |||||||||||||||||
Number of properties | 32 | 32 | |||||||||||||||
Rentable square feet | 7,886,740 | 7,886,740 | |||||||||||||||
Ending % leased | 96.0 | % | 93.4 | % | |||||||||||||
Ending % occupied | 95.1 | % | 92.6 | % | |||||||||||||
Average % occupied for the period | 94.1 | % | 92.7 | % | |||||||||||||
Average annual rental rate per square foot | $ | 48.94 | $ | 46.42 | |||||||||||||
Same-store studio | |||||||||||||||||
Number of properties | 3 | 3 | |||||||||||||||
Rentable square feet | 1,171,707 | 1,171,707 | |||||||||||||||
Average % occupied for the period(1) | 92.6 | % | 88.1 | % |
Three Months Ended June 30, | |||||||
2018 | 2017 | ||||||
Same-Store Office | |||||||
Number of properties | 30 | 30 | |||||
Rentable square feet | 7,507,449 | 7,507,449 | |||||
Ending % leased | 93.2 | % | 94.5 | % | |||
Ending % occupied | 92.4 | % | 93.9 | % | |||
Average % occupied for the period | 92.4 | % | 93.7 | % | |||
Average annual rental rate per square foot | $ | 45.83 | $ | 42.41 | |||
Same-Store Studio | |||||||
Number of properties | 2 | 2 | |||||
Rentable square feet | 873,002 | 873,002 | |||||
Average % occupied for the period | 89.6 | % | 89.9 | % |
Three Months Ended June 30, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2019 | 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Same-Store | Non-Same-Store | Total | Same-Store | Non-Same-Store | Total | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenues | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Office | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Rental | $ | 95,132 | $ | 51,505 | $ | 146,637 | $ | 87,601 | $ | 42,131 | $ | 129,732 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Tenant recoveries | 18,106 | 7,513 | 25,619 | 16,867 | 5,093 | 21,960 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Service revenues | 5,013 | 1,778 | 6,791 | 5,210 | 1,648 | 6,858 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total office revenues | 118,251 | 60,796 | 179,047 | 109,678 | 48,872 | 158,550 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Studio | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Rental | 12,612 | 551 | 13,163 | 10,708 | — | 10,708 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Tenant recoveries | 1,442 | (84) | 1,358 | 500 | — | 500 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Service revenues and other | 2,911 | 177 | 3,088 | 5,411 | — | 5,411 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total studio revenues | 16,965 | 644 | 17,609 | 16,619 | — | 16,619 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total revenues | 135,216 | 61,440 | 196,656 | 126,297 | 48,872 | 175,169 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Office operating expenses | 33,833 | 27,063 | 60,896 | 34,780 | 19,160 | 53,940 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Studio operating expenses | 9,544 | (5) | 9,539 | 8,539 | — | 8,539 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total operating expenses | 43,377 | 27,058 | 70,435 | 43,319 | 19,160 | 62,479 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Office NOI | 84,418 | 33,733 | 118,151 | 74,898 | 29,712 | 104,610 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Studio NOI | 7,421 | 649 | 8,070 | 8,080 | — | 8,080 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
NOI | $ | 91,839 | $ | 34,382 | $ | 126,221 | $ | 82,978 | $ | 29,712 | $ | 112,690 |
Three Months Ended June 30, | |||||||||||||||||||
2018 | 2017 | ||||||||||||||||||
Same-Store | Non-Same-Store | Total | Same-Store | Non-Same-Store | Total | ||||||||||||||
Revenues | |||||||||||||||||||
Office | |||||||||||||||||||
Rental | $ | 82,185 | $ | 47,547 | $ | 129,732 | $ | 78,045 | $ | 55,557 | $ | 133,602 | |||||||
Tenant recoveries | 16,312 | 5,648 | 21,960 | 18,338 | 6,700 | 25,038 | |||||||||||||
Parking and other | 4,206 | 2,652 | 6,858 | 3,513 | 4,699 | 8,212 | |||||||||||||
Total Office revenues | 102,703 | 55,847 | 158,550 | 99,896 | 66,956 | 166,852 | |||||||||||||
Studio | |||||||||||||||||||
Rental | 7,498 | 3,210 | 10,708 | 7,109 | 1,996 | 9,105 | |||||||||||||
Tenant recoveries | 476 | 24 | 500 | 64 | 65 | 129 | |||||||||||||
Other property-related revenue | 3,125 | 2,176 | 5,301 | 3,054 | 1,307 | 4,361 | |||||||||||||
Other | 110 | — | 110 | 47 | 6 | 53 | |||||||||||||
Total Studio revenues | 11,209 | 5,410 | 16,619 | 10,274 | 3,374 | 13,648 | |||||||||||||
Total revenues | 113,912 | 61,257 | 175,169 | 110,170 | 70,330 | 180,500 | |||||||||||||
Operating Expenses | |||||||||||||||||||
Office operating expenses | 33,365 | 20,575 | 53,940 | 31,685 | 23,783 | 55,468 | |||||||||||||
Studio operating expenses | 5,199 | 3,340 | 8,539 | 4,935 | 2,068 | 7,003 | |||||||||||||
Total operating expenses | 38,564 | 23,915 | 62,479 | 36,620 | 25,851 | 62,471 | |||||||||||||
Office NOI | 69,338 | 35,272 | 104,610 | 68,211 | 43,173 | 111,384 | |||||||||||||
Studio NOI | 6,010 | 2,070 | 8,080 | 5,339 | 1,306 | 6,645 | |||||||||||||
NOI | $ | 75,348 | $ | 37,342 | $ | 112,690 | $ | 73,550 | $ | 44,479 | $ | 118,029 |
Three Months Ended June 30, 2019 as compared to Three Months Ended June 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Same-Store | Non-Same-Store | Total | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Dollar Change | Percent Change | Dollar Change | Percent Change | Dollar Change | Percent Change | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenues | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Office | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Rental | $ | 7,531 | 8.6 | % | $ | 9,374 | 22.2 | % | $ | 16,905 | 13.0 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Tenant recoveries | 1,239 | 7.3 | 2,420 | 47.5 | 3,659 | 16.7 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Service revenues | (197) | (3.8) | 130 | 7.9 | (67) | (1.0) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total office revenues | 8,573 | 7.8 | 11,924 | 24.4 | 20,497 | 12.9 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Studio | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Rental | 1,904 | 17.8 | 551 | 100.0 | 2,455 | 22.9 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Tenant recoveries | 942 | 188.4 | (84) | (100.0) | 858 | 171.6 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Service revenues and other | (2,500) | (46.2) | 177 | 100.0 | (2,323) | (42.9) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total studio revenues | 346 | 2.1 | 644 | 100.0 | 990 | 6.0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total revenues | 8,919 | 7.1 | 12,568 | 25.7 | 21,487 | 12.3 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Office operating expenses | (947) | (2.7) | 7,903 | 41.2 | 6,956 | 12.9 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Studio operating expenses | 1,005 | 11.8 | (5) | (100.0) | 1,000 | 11.7 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total operating expenses | 58 | 0.1 | 7,898 | 41.2 | 7,956 | 12.7 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Office NOI | 9,520 | 12.7 | 4,021 | 13.5 | 13,541 | 12.9 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Studio NOI | (659) | (8.2) | 649 | 100.0 | (10) | (0.1) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
NOI | $ | 8,861 | 10.7 | % | $ | 4,670 | 15.7 | % | $ | 13,531 | 12.0 | % |
Three Months Ended June 30, 2018 as compared to Three Months Ended June 30, 2017 | |||||||||||||||||
Same-Store | Non-Same-Store | Total | |||||||||||||||
Dollar Change | Percent Change | Dollar Change | Percent Change | Dollar Change | Percent Change | ||||||||||||
Revenues | |||||||||||||||||
Office | |||||||||||||||||
Rental | $ | 4,140 | 5.3 | % | $ | (8,010 | ) | (14.4 | )% | $ | (3,870 | ) | (2.9 | )% | |||
Tenant recoveries | (2,026 | ) | (11.0 | ) | (1,052 | ) | (15.7 | ) | (3,078 | ) | (12.3 | ) | |||||
Parking and other | 693 | 19.7 | (2,047 | ) | (43.6 | ) | (1,354 | ) | (16.5 | ) | |||||||
Total Office revenues | 2,807 | 2.8 | (11,109 | ) | (16.6 | ) | (8,302 | ) | (5.0 | ) | |||||||
Studio | |||||||||||||||||
Rental | 389 | 5.5 | 1,214 | 60.8 | 1,603 | 17.6 | |||||||||||
Tenant recoveries | 412 | 643.8 | (41 | ) | (63.1 | ) | 371 | 287.6 | |||||||||
Other property-related revenue | 71 | 2.3 | 869 | 66.5 | 940 | 21.6 | |||||||||||
Other | 63 | 134.0 | (6 | ) | (100.0 | ) | 57 | 107.5 | |||||||||
Total Studio revenues | 935 | 9.1 | 2,036 | 60.3 | 2,971 | 21.8 | |||||||||||
Total revenues | 3,742 | 3.4 | (9,073 | ) | (12.9 | ) | (5,331 | ) | (3.0 | ) | |||||||
Operating expenses | |||||||||||||||||
Office operating expenses | 1,680 | 5.3 | (3,208 | ) | (13.5 | ) | (1,528 | ) | (2.8 | ) | |||||||
Studio operating expenses | 264 | 5.3 | 1,272 | 61.5 | 1,536 | 21.9 | |||||||||||
Total operating expenses | 1,944 | 5.3 | (1,936 | ) | (7.5 | ) | 8 | — | |||||||||
Office NOI | 1,127 | 1.7 | (7,901 | ) | (18.3 | ) | (6,774 | ) | (6.1 | ) | |||||||
Studio NOI | 671 | 12.6 | 764 | 58.5 | 1,435 | 21.6 | |||||||||||
NOI | $ | 1,798 | 2.4 | % | $ | (7,137 | ) | (16.0 | )% | $ | (5,339 | ) | (4.5 | )% |
Three Months Ended June 30, | |||||||||||||||||||||||||||||||||||||||||
2019 | 2018 | Dollar Change | Percent Change | ||||||||||||||||||||||||||||||||||||||
Gross interest expense | $ | 28,980 | $ | 21,514 | $ | 7,466 | 34.7 | % | |||||||||||||||||||||||||||||||||
Capitalized interest | (3,871) | (3,618) | (253) | 7.0 | |||||||||||||||||||||||||||||||||||||
Amortization of deferred financing costs and loan discounts/premiums | 1,443 | 1,435 | 8 | 0.6 | |||||||||||||||||||||||||||||||||||||
TOTAL | $ | 26,552 | $ | 19,331 | $ | 7,221 | 37.4 | % |
Six Months Ended June 30, | ||||||||||||||
2018 | 2017 | Dollar Change | Percent Change | |||||||||||
Net income | $ | 72,254 | $ | 31,107 | $ | 41,147 | 132.3 | % | ||||||
Adjustments: | ||||||||||||||
Interest expense | 39,834 | 43,625 | (3,791 | ) | (8.7 | ) | ||||||||
Interest income | (75 | ) | (46 | ) | (29 | ) | 63.0 | |||||||
Unrealized loss on ineffective portion of derivatives | — | 45 | (45 | ) | (100.0 | ) | ||||||||
Unrealized gain on non-real estate investment | (928 | ) | — | (928 | ) | (100.0 | ) | |||||||
Transaction-related expenses | 118 | — | 118 | 100.0 | ||||||||||
Other income | (723 | ) | (1,254 | ) | 531 | (42.3 | ) | |||||||
Gains on sale of real estate | (39,602 | ) | (16,866 | ) | (22,736 | ) | 134.8 | |||||||
Income from operations | 70,878 | 56,611 | 14,267 | 25.2 | ||||||||||
Adjustments: | ||||||||||||||
General and administrative | 31,767 | 28,316 | 3,451 | 12.2 | ||||||||||
Depreciation and amortization | 121,259 | 146,182 | (24,923 | ) | (17.0 | ) | ||||||||
NOI | $ | 223,904 | $ | 231,109 | $ | (7,205 | ) | (3.1 | )% | |||||
Same-Store NOI | $ | 146,433 | $ | 142,272 | $ | 4,161 | 2.9 | % | ||||||
Non-Same-Store NOI | 77,471 | 88,837 | (11,366 | ) | (12.8 | ) | ||||||||
NOI | $ | 223,904 | $ | 231,109 | $ | (7,205 | ) | (3.1 | )% |
Six Months Ended June 30, 2019 | Dollar Change | Percent Change | |||||||||||||||||||||||||||
2019 | 2018 | ||||||||||||||||||||||||||||
Net (loss) income | $ | (24,072) | $ | 72,254 | $ | (96,326) | (133.3) | % | |||||||||||||||||||||
Adjustments: | |||||||||||||||||||||||||||||
Loss from unconsolidated real estate investments | 85 | — | 85 | 100.0 | |||||||||||||||||||||||||
Interest expense | 50,902 | 39,834 | 11,068 | 27.8 | |||||||||||||||||||||||||
Interest income | (2,032) | (75) | (1,957) | 2,609.3 | |||||||||||||||||||||||||
Transaction-related expenses | 128 | 118 | 10 | 8.5 | |||||||||||||||||||||||||
Other income | (75) | (723) | 648 | (89.6) | |||||||||||||||||||||||||
Unrealized gain on non-real estate investment | — | (928) | 928 | 100.0 | |||||||||||||||||||||||||
Gains on sale of real estate | — | (39,602) | 39,602 | 100.0 | |||||||||||||||||||||||||
Impairment loss | 52,201 | — | 52,201 | 100.0 | |||||||||||||||||||||||||
General and administrative | 36,438 | 31,767 | 4,671 | 14.7 | |||||||||||||||||||||||||
Depreciation and amortization | 138,111 | 121,259 | 16,852 | 13.9 | |||||||||||||||||||||||||
NOI | $ | 251,686 | $ | 223,904 | $ | 27,782 | 12.4 | % | |||||||||||||||||||||
Same-store NOI | $ | 180,133 | $ | 164,123 | $ | 16,010 | 9.8 | % | |||||||||||||||||||||
Non-same-store NOI | 71,553 | 59,781 | 11,772 | 19.7 | |||||||||||||||||||||||||
NOI | $ | 251,686 | $ | 223,904 | $ | 27,782 | 12.4 | % |
Six Months Ended June 30, | |||||||||||||||||
2019 | 2018 | ||||||||||||||||
Revenues | |||||||||||||||||
Office | |||||||||||||||||
Rental | $ | 342,453 | $ | 259,814 | |||||||||||||
Tenant recoveries | — | 42,864 | |||||||||||||||
Service revenues | 12,452 | 12,404 | |||||||||||||||
Total office revenues | 354,905 | 315,082 | |||||||||||||||
Studio | |||||||||||||||||
Rental | 26,915 | 21,091 | |||||||||||||||
Tenant recoveries | — | 854 | |||||||||||||||
Service revenues and other | 12,225 | 12,260 | |||||||||||||||
Total studio revenues | 39,140 | 34,205 | |||||||||||||||
TOTAL REVENUES | $ | 394,045 | $ | 349,287 |
Six Months Ended June 30, | |||||||||||||||||
2019 | 2018 | ||||||||||||||||
Revenues | |||||||||||||||||
Office | |||||||||||||||||
Rental | $ | 292,097 | $ | 259,814 | |||||||||||||
Tenant recoveries | 50,356 | 42,864 | |||||||||||||||
Service revenues | 12,452 | 12,404 | |||||||||||||||
Total office revenues | 354,905 | 315,082 | |||||||||||||||
Studio | |||||||||||||||||
Rental | 23,977 | 21,091 | |||||||||||||||
Tenant recoveries | 2,938 | 854 | |||||||||||||||
Service revenues and other | 12,225 | 12,260 | |||||||||||||||
Total studio revenues | 39,140 | 34,205 | |||||||||||||||
TOTAL REVENUES | $ | 394,045 | $ | 349,287 |
Six Months Ended June 30, | |||||||||||||||||
2019 | 2018 | ||||||||||||||||
Same-store office | |||||||||||||||||
Number of properties | 31 | 31 | |||||||||||||||
Rentable square feet | 7,842,480 | 7,842,480 | |||||||||||||||
Ending % leased | 95.9 | % | 93.4 | % | |||||||||||||
Ending % occupied | 95.1 | % | 92.6 | % | |||||||||||||
Average % occupied for the period | 93.5 | % | 92.8 | % | |||||||||||||
Average annual rental rate per square foot | $ | 48.82 | $ | 46.30 | |||||||||||||
Same-store studio | |||||||||||||||||
Number of properties | 3 | 3 | |||||||||||||||
Rentable square feet | 1,171,707 | 1,171,707 | |||||||||||||||
Average % occupied for the period(1) | 92.6 | % | 88.1 | % |
Six Months Ended June 30, | |||||||
2018 | 2017 | ||||||
Same-Store Office | |||||||
Number of properties | 29 | 29 | |||||
Rentable square feet | 7,308,513 | 7,308,513 | |||||
Ending % leased | 93.3 | % | 94.4 | % | |||
Ending % occupied | 92.4 | % | 93.8 | % | |||
Average % occupied for the period | 92.5 | % | 94.4 | % | |||
Average annual rental rate per square foot | $ | 45.61 | $ | 42.19 | |||
Same-Store Studio | |||||||
Number of properties | 2 | 2 | |||||
Rentable square feet | 873,002 | 873,002 | |||||
Average % occupied for the period | 89.6 | % | 89.9 | % |
Six Months Ended June 30, | |||||||||||||||||||
2018 | 2017 | ||||||||||||||||||
Same-Store | Non-Same-Store | Total | Same-Store | Non-Same-Store | Total | ||||||||||||||
Revenues | |||||||||||||||||||
Office | |||||||||||||||||||
Rental | $ | 159,206 | $ | 100,608 | $ | 259,814 | $ | 152,476 | $ | 114,642 | $ | 267,118 | |||||||
Tenant recoveries | 31,748 | 11,116 | 42,864 | 29,353 | 13,086 | 42,439 | |||||||||||||
Parking and other | 7,531 | 4,873 | 12,404 | 6,551 | 7,560 | 14,111 | |||||||||||||
Total Office revenues | 198,485 | 116,597 | 315,082 | 188,380 | 135,288 | 323,668 | |||||||||||||
Studio | |||||||||||||||||||
Rental | 15,028 | 6,063 | 21,091 | 13,793 | 1,997 | 15,790 | |||||||||||||
Tenant recoveries | 723 | 131 | 854 | 730 | 64 | 794 | |||||||||||||
Other property-related revenue | 7,196 | 4,540 | 11,736 | 7,096 | 1,307 | 8,403 | |||||||||||||
Other | 524 | — | 524 | 124 | 6 | 130 | |||||||||||||
Total Studio revenues | 23,471 | 10,734 | 34,205 | 21,743 | 3,374 | 25,117 | |||||||||||||
Total revenues | 221,956 | 127,331 | 349,287 | 210,123 | 138,662 | 348,785 | |||||||||||||
Operating Expenses | |||||||||||||||||||
Office operating expenses | 63,937 | 43,243 | 107,180 | 55,664 | 47,758 | 103,422 | |||||||||||||
Studio operating expenses | 11,586 | 6,617 | 18,203 | 12,187 | 2,067 | 14,254 | |||||||||||||
Total operating expenses | 75,523 | 49,860 | 125,383 | 67,851 | 49,825 | 117,676 | |||||||||||||
Office NOI | 134,548 | 73,354 | 207,902 | 132,716 | 87,530 | 220,246 | |||||||||||||
Studio NOI | 11,885 | 4,117 | 16,002 | 9,556 | 1,307 | 10,863 | |||||||||||||
NOI | $ | 146,433 | $ | 77,471 | $ | 223,904 | $ | 142,272 | $ | 88,837 | $ | 231,109 |
Six Months Ended June 30, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2019 | 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Same-Store | Non-Same-Store | Total | Same-Store | Non-Same-Store | Total | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenues | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Office | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Rental | $ | 187,378 | $ | 104,719 | $ | 292,097 | $ | 173,551 | $ | 86,263 | $ | 259,814 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Tenant recoveries | 35,247 | 15,109 | 50,356 | 33,305 | 9,559 | 42,864 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Service revenues | 9,204 | 3,248 | 12,452 | 9,314 | 3,090 | 12,404 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total office revenues | 231,829 | 123,076 | 354,905 | 216,170 | 98,912 | 315,082 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Studio | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Rental | 22,948 | 1,029 | 23,977 | 21,091 | — | 21,091 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Tenant recoveries | 2,669 | 269 | 2,938 | 854 | — | 854 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Service revenues and other | 12,259 | (34) | 12,225 | 12,260 | — | 12,260 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total studio revenues | 37,876 | 1,264 | 39,140 | 34,205 | — | 34,205 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total revenues | 269,705 | 124,340 | 394,045 | 250,375 | 98,912 | 349,287 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Office operating expenses | 69,045 | 52,666 | 121,711 | 68,049 | 39,131 | 107,180 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Studio operating expenses | 20,527 | 121 | 20,648 | 18,203 | — | 18,203 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total operating expenses | 89,572 | 52,787 | 142,359 | 86,252 | 39,131 | 125,383 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Office NOI | 162,784 | 70,410 | 233,194 | 148,121 | 59,781 | 207,902 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Studio NOI | 17,349 | 1,143 | 18,492 | 16,002 | — | 16,002 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
NOI | $ | 180,133 | $ | 71,553 | $ | 251,686 | $ | 164,123 | $ | 59,781 | $ | 223,904 |
Six Months Ended June 30, 2019 as compared to Six Months Ended June 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Same-Store | Non-Same-Store | Total | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Dollar Change | Percent Change | Dollar Change | Percent Change | Dollar Change | Percent Change | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenues | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Office | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Rental | $ | 13,827 | 8.0 | % | $ | 18,456 | 21.4 | % | $ | 32,283 | 12.4 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Tenant recoveries | 1,942 | 5.8 | 5,550 | 58.1 | 7,492 | 17.5 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Service revenues | (110) | (1.2) | 158 | 5.1 | 48 | 0.4 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total office revenues | 15,659 | 7.2 | 24,164 | 24.4 | 39,823 | 12.6 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Studio | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Rental | 1,857 | 8.8 | 1,029 | 100.0 | 2,886 | 13.7 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Tenant recoveries | 1,815 | 212.5 | 269 | 100.0 | 2,084 | 244.0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Service revenues and other | (1) | — | (34) | (100.0) | (35) | (0.3) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total studio revenues | 3,671 | 10.7 | 1,264 | 100.0 | 4,935 | 14.4 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total revenues | 19,330 | 7.7 | 25,428 | 25.7 | 44,758 | 12.8 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Office operating expenses | 996 | 1.5 | 13,535 | 34.6 | 14,531 | 13.6 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Studio operating expenses | 2,324 | 12.8 | 121 | 100.0 | 2,445 | 13.4 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total operating expenses | 3,320 | 3.8 | 13,656 | 34.9 | 16,976 | 13.5 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Office NOI | 14,663 | 9.9 | 10,629 | 17.8 | 25,292 | 12.2 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Studio NOI | 1,347 | 8.4 | 1,143 | 100.0 | 2,490 | 15.6 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
NOI | $ | 16,010 | 9.8 | % | $ | 11,772 | 19.7 | % | $ | 27,782 | 12.4 | % |
Six Months Ended June 30, 2018 as compared to Six Months Ended June 30, 2017 | |||||||||||||||||
Same-Store | Non-Same-Store | Total | |||||||||||||||
Dollar Change | Percent Change | Dollar Change | Percent Change | Dollar Change | Percent Change | ||||||||||||
Revenues | |||||||||||||||||
Office | |||||||||||||||||
Rental | $ | 6,730 | 4.4 | % | $ | (14,034 | ) | (12.2 | )% | $ | (7,304 | ) | (2.7 | )% | |||
Tenant recoveries | 2,395 | 8.2 | (1,970 | ) | (15.1 | ) | 425 | 1.0 | |||||||||
Parking and other | 980 | 15.0 | (2,687 | ) | (35.5 | ) | (1,707 | ) | (12.1 | ) | |||||||
Total Office revenues | 10,105 | 5.4 | (18,691 | ) | (13.8 | ) | (8,586 | ) | (2.7 | ) | |||||||
Studio | |||||||||||||||||
Rental | 1,235 | 9.0 | 4,066 | 203.6 | 5,301 | 33.6 | |||||||||||
Tenant recoveries | (7 | ) | (1.0 | ) | 67 | 104.7 | 60 | 7.6 | |||||||||
Other property-related revenue | 100 | 1.4 | 3,233 | 247.4 | 3,333 | 39.7 | |||||||||||
Other | 400 | 322.6 | (6 | ) | (100.0 | ) | 394 | 303.1 | |||||||||
Total Studio revenues | 1,728 | 7.9 | 7,360 | 218.1 | 9,088 | 36.2 | |||||||||||
Total revenues | 11,833 | 5.6 | (11,331 | ) | (8.2 | ) | 502 | 0.1 | |||||||||
Operating expenses | |||||||||||||||||
Office operating expenses | 8,273 | 14.9 | (4,515 | ) | (9.5 | ) | 3,758 | 3.6 | |||||||||
Studio operating expenses | (601 | ) | (4.9 | ) | 4,550 | 220.1 | 3,949 | 27.7 | |||||||||
Total operating expenses | 7,672 | 11.3 | 35 | 0.1 | 7,707 | 6.5 | |||||||||||
Office NOI | 1,832 | 1.4 | (14,176 | ) | (16.2 | ) | (12,344 | ) | (5.6 | ) | |||||||
Studio NOI | 2,329 | 24.4 | 2,810 | 215.0 | 5,139 | 47.3 | |||||||||||
NOI | $ | 4,161 | 2.9 | % | $ | (11,366 | ) | (12.8 | )% | $ | (7,205 | ) | (3.1 | )% |
Six Months Ended June 30, | |||||||||||||||||||||||||||||||||||||||||
2019 | 2018 | Dollar Change | Percent Change | ||||||||||||||||||||||||||||||||||||||
Gross interest expense | $ | 56,445 | $ | 43,945 | $ | 12,500 | 28.4 | % | |||||||||||||||||||||||||||||||||
Capitalized interest | (8,577) | (7,204) | (1,373) | 19.1 | |||||||||||||||||||||||||||||||||||||
Amortization of deferred financing costs and loan discounts/premiums | 3,034 | 3,093 | (59) | (1.9) | |||||||||||||||||||||||||||||||||||||
TOTAL | $ | 50,902 | $ | 39,834 | $ | 11,068 | 27.8 | % |
June 30, 2018 | ||||
Notes payable(1) | $ | 2,380,652 | ||
Series A preferred units(2) | 9,815 | |||
Common equity capitalization(3) | 5,605,960 | |||
Total market capitalization | $ | 7,996,427 | ||
Series A preferred units & debt/total market capitalization | 29.9 | % |
June 30, 2019 | |||||
Unsecured and secured debt(1) |
$ | 2,850,099 | |||||||
9,815 | ||||||||
Total consolidated debt | 2,859,914 | |||||||
Common equity capitalization | 5,248,057 | |||||||
TOTAL CONSOLIDATED MARKET CAPITALIZATION | $ | 8,107,971 | ||||||
Total consolidated debt/total consolidated market capitalization | 35.3 | % |
June 30, 2018 | December 31, 2017 | Interest Rate(1) | Contractual Maturity Date | |||||||||
UNSECURED NOTES PAYABLE | ||||||||||||
Unsecured Revolving Credit Facility(2)(3) | $ | 140,000 | $ | 100,000 | LIBOR + 1.05% to 1.50% | 3/13/2022 | (4) | |||||
Term Loan A(2)(5) | 300,000 | 300,000 | LIBOR + 1.20% to 1.70% | 4/1/2020 | (6) | |||||||
Term Loan C(2) | 75,000 | 75,000 | LIBOR + 1.30% to 2.20% | 11/17/2020 | ||||||||
Term Loan B(2)(7) | 350,000 | 350,000 | LIBOR + 1.20% to 1.70% | 4/1/2022 | ||||||||
Term Loan D(2)(8) | 125,000 | 125,000 | LIBOR + 1.20% to 1.70% | 11/17/2022 | ||||||||
Series A Notes | 110,000 | 110,000 | 4.34% | 1/2/2023 | ||||||||
Series E Notes | 50,000 | 50,000 | 3.66% | 9/15/2023 | ||||||||
Series B Notes | 259,000 | 259,000 | 4.69% | 12/16/2025 | ||||||||
Series D Notes | 150,000 | 150,000 | 3.98% | 7/6/2026 | ||||||||
Registered Senior Notes(9) | 400,000 | 400,000 | 3.95% | 11/1/2027 | ||||||||
Series C Notes | 56,000 | 56,000 | 4.79% | 12/16/2027 | ||||||||
TOTAL UNSECURED NOTES PAYABLE | 2,015,000 | 1,975,000 | ||||||||||
SECURED NOTES PAYABLE | ||||||||||||
Sunset Gower Studios/Sunset Bronson Studios(10) | 5,001 | 5,001 | LIBOR + 2.25% | 3/4/2019 | (4) | |||||||
Met Park North(11) | 64,500 | 64,500 | LIBOR + 1.55% | 8/1/2020 | ||||||||
10950 Washington(12) | 27,151 | 27,418 | 5.32% | 3/11/2022 | ||||||||
Element LA | 168,000 | 168,000 | 4.59% | 11/6/2025 | ||||||||
Hill7(13) | 101,000 | 101,000 | 3.38% | 11/6/2028 | ||||||||
Rincon Center | — | 98,392 | 5.13% | N/A | ||||||||
TOTAL SECURED NOTES PAYABLE | 365,652 | 464,311 | ||||||||||
TOTAL NOTES PAYABLE | 2,380,652 | 2,439,311 | ||||||||||
Unamortized deferred financing costs and loan discounts(14) | (18,903 | ) | (17,931 | ) | ||||||||
TOTAL NOTES PAYABLE, NET | $ | 2,361,749 | $ | 2,421,380 |
June 30, 2019 | December 31, 2018 | ||||||||||
Unsecured debt | $ | 2,485,000 | $ | 2,275,000 | |||||||
Secured debt | $ | 365,099 | $ | 365,381 | |||||||
In-substance defeased debt | $ | 136,636 | $ | 138,223 | |||||||
Joint venture partner debt | $ | 66,136 | $ | 66,136 |
Six Months Ended June 30, | |||||||||||||||||||||||||||||
2019 | 2018 | Dollar Change | Percent Change | ||||||||||||||||||||||||||
Net cash provided by operating activities | $ | 145,716 | $ | 102,519 | $ | 43,197 | 42.1 | % | |||||||||||||||||||||
Net cash (used in) provided by investing activities | $ | (270,036) | $ | 7,502 | $ | (277,538) | (3,699.5) | % | |||||||||||||||||||||
Net cash provided by (used in) financing activities | $ | 117,676 | $ | (145,314) | $ | 262,990 | (181.0) | % |
Six Months Ended June 30, | ||||||||||||||
2018 | 2017 | Dollar Change | Percent Change | |||||||||||
Net cash provided by operating activities | $ | 102,519 | $ | 141,036 | $ | (38,517 | ) | (27.3 | )% | |||||
Net cash provided by (used in) investing activities | 7,502 | (309,681 | ) | 317,183 | (102.4 | ) | ||||||||
Net cash (used in) provided by financing activities | (145,314 | ) | 150,979 | (296,293 | ) | (196.2 | ) |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||||||||||||||||||||||
Net income (loss) | $ | 12,823 | $ | 19,691 | $ | (24,072) | $ | 72,254 | |||||||||||||||||||||||||||
Adjustments: | |||||||||||||||||||||||||||||||||||
Depreciation and amortization—Consolidated | 69,606 | 60,706 | 138,111 | 121,259 | |||||||||||||||||||||||||||||||
Depreciation and amortization—Corporate-related | (530) | (489) | (1,053) | (973) | |||||||||||||||||||||||||||||||
Depreciation and amortization—Company’s share from unconsolidated real estate investment | 563 | — | 563 | — | |||||||||||||||||||||||||||||||
Gains on sale of real estate | — | (1,928) | — | (39,602) | |||||||||||||||||||||||||||||||
Impairment loss | — | — | 52,201 | — | |||||||||||||||||||||||||||||||
Unrealized gain on non-real estate investment | — | (928) | — | (928) | |||||||||||||||||||||||||||||||
FFO attributable to non-controlling interests | (6,831) | (5,316) | (13,569) | (10,647) | |||||||||||||||||||||||||||||||
FFO attributable to preferred units | (153) | (153) | (306) | (312) | |||||||||||||||||||||||||||||||
FFO TO COMMON STOCKHOLDERS AND UNITHOLDERS | $ | 75,478 | $ | 71,583 | $ | 151,875 | $ | 141,051 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Net income | $ | 19,691 | $ | 6,954 | $ | 72,254 | $ | 31,107 | |||||||
Adjustments: | |||||||||||||||
Depreciation and amortization of real estate assets | 60,217 | 74,939 | 120,286 | 145,233 | |||||||||||
Gains on sale of real estate | (1,928 | ) | — | (39,602 | ) | (16,866 | ) | ||||||||
FFO attributable to non-controlling interests | (5,316 | ) | (6,445 | ) | (10,647 | ) | (11,952 | ) | |||||||
Net income attributable to preferred units | (153 | ) | (159 | ) | (312 | ) | (318 | ) | |||||||
FFO to common stockholders and unitholders | $ | 72,511 | $ | 75,289 | $ | 141,979 | $ | 147,204 |
ITEM 1A. RISK FACTORS |
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS |
ITEM 4. MINE SAFETY DISCLOSURES |
ITEM 5. OTHER INFORMATION |
Incorporated by Reference | ||||||||||||||||||||||||||||||||||||||||||||||||||
Exhibit No. | Description | Form | File No. | Exhibit No. | Filing Date | |||||||||||||||||||||||||||||||||||||||||||||
3.1 | S-11/A | 333-164916 | 3.1 | May 12, 2010 | ||||||||||||||||||||||||||||||||||||||||||||||
3.2 | 8-K | 001-34789 | 3.1 | January 12, 2015 | ||||||||||||||||||||||||||||||||||||||||||||||
3.3 | 10-K | 001-34789 | 10.1 | February 26, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||
3.4 | 10-Q | 001-34789 | 3.4 | November 4, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||
31.1 | ||||||||||||||||||||||||||||||||||||||||||||||||||
31.2 | ||||||||||||||||||||||||||||||||||||||||||||||||||
31.3 | ||||||||||||||||||||||||||||||||||||||||||||||||||
31.4 | ||||||||||||||||||||||||||||||||||||||||||||||||||
32.1 | ||||||||||||||||||||||||||||||||||||||||||||||||||
32.2 | ||||||||||||||||||||||||||||||||||||||||||||||||||
101 | The following financial information from Hudson Pacific Properties, Inc.’s and Hudson Pacific Properties, L.P.’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2019 formatted in XBRL (eXtensible Business Reporting Language): (i) Consolidated Balance Sheets (unaudited), (ii) Consolidated Statements of Operations (unaudited), (iii) Consolidated Statements of Comprehensive Income (Loss) (unaudited), (iv) Consolidated Statements of Equity (unaudited), (v) Consolidated Statements of Capital (unaudited), (vi) Consolidated Statements of Cash Flows (unaudited) and (vii) Notes to Unaudited Consolidated Financial Statements* |
Incorporated by Reference | ||||||||||
Exhibit No. | Description | Form | File No. | Exhibit No. | Filing Date | |||||
3.1 | S-11/A | 333-164916 | 3.1 | May 12, 2010 | ||||||
3.2 | 8-K | 001-34789 | 3.1 | January 12, 2015 | ||||||
3.3 | 10-K | 001-34789 | 10.1 | February 26, 2016 | ||||||
3.4 | 10-Q | 001-34789 | 3.4 | November 4, 2016 | ||||||
10.1 | ||||||||||
31.1 | ||||||||||
31.2 | ||||||||||
31.3 | ||||||||||
31.4 | ||||||||||
32.1 | ||||||||||
32.2 | ||||||||||
101 | The following financial information from Hudson Pacific Properties, Inc.’s and Hudson Pacific Properties, L.P.’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2018 formatted in XBRL (eXtensible Business Reporting Language): (i) Consolidated Balance Sheets (unaudited), (ii) Consolidated Statements of Operations (unaudited), (iii) Consolidated Statements of Comprehensive Income (unaudited), (iv) Consolidated Statements of Equity (unaudited), (v) Consolidated Statements of Capital (unaudited), (vi) Consolidated Statements of Cash Flows (unaudited) and (vii) Notes to Unaudited Consolidated Financial Statements** |
* | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Pursuant to Rule 406T of Regulation S-T, the interactive data files on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Section 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections. |
HUDSON PACIFIC PROPERTIES, INC. | |||||||||||
Date: | |||||||||||
August 1, | /S/ VICTOR J. COLEMAN | ||||||||||
Victor J. Coleman Chief Executive Officer (Principal Executive Officer) |
HUDSON PACIFIC PROPERTIES, INC. | |||||||||||
Date: | |||||||||||
August 1, | /S/ MARK | ||||||||||
Mark Chief Operating Officer, Chief Financial Officer and Treasurer (Principal Financial Officer) |
HUDSON PACIFIC PROPERTIES, L.P. | |||||||||||
Date: | |||||||||||
August 1, | /S/ VICTOR J. COLEMAN | ||||||||||
Victor J. Coleman Chief Executive Officer (Principal Executive Officer) |
HUDSON PACIFIC PROPERTIES, L.P. | |||||||||||
Date: | |||||||||||
August 1, | /S/ MARK | ||||||||||
Mark Chief Operating Officer, Chief Financial Officer and Treasurer (Principal Financial Officer) |