HPP - Earnings call 3 2023 | Hudson Pacific Properties, Inc.

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Operator

Good morning, and welcome to the Hudson Pacific Properties Third Quarter 2023 Conference Call. [Operator Instructions] Please note, this event is being recorded.

I would now like to turn the conference over to Laura Campbell, Executive Vice President, Investor Relations and Marketing. Please go ahead.

Laura Campbell

Good morning, everyone. us. joining for Thanks the Lammas, are and President; Leasing. EVP on and Art Coleman, Chairman; of Mark Harout call me Victor today CEO Suazo, With Diramerian, CFO;

X-K earnings available now our our be website. of supplemental Yesterday, available both webcast on release audio call filed SEC, and our on we website. an this with An for the are on and will replay

for we'll forward-looking earnings measures information the of share regarding supplemental in release Please of call reconciliation is on as Some today used information our nature. reference and a call. well statements forward-looking the on as this financial non-GAAP

financial discuss will and office Victor Mark studio XXXX will relation tail macro Today, our to and our Harout business. results conditions in and operations outlook. our on development, provide review will

happy take Victor? be we'll questions. to your Thereafter,

Victor Coleman

you, morning, Good today. joining and for thanks Laura. Thank our call everyone,

leasing office year-end, position improvement both head in into to As related writers pending actors strikes. benefiting and with the next begin a we accelerating, from and of completion year our we're the in sentiment the ongoing activity

policies, Tech in-office are implement is traffic and more public and focus sector ridership the Coast renewed to and in week a X growing. public finally there's West address and transit days enforcing markets our Foot to improving, along and safety X employers a mostly crime pro-business policies.

city, of at portfolio-wide, feet full-time And San of there levels. is well. up already the the quarter, square year-to-date. over is CBD basis. Francisco utilized were X as improving Francisco's XX% in office-related XX% to and pre-COVID million fully XX% the was a year-over-year space outlook our In of hybrid ] San XX% requirements third either of Close [ parking up or outside office on revenue our

space this requirements Over XXX,XXX of feet, Financial XX% a the late-stage square AI over in ] Mission XX there feet XXX,XXX tech square of now key these in Anthoropic ] remaining [ for feet driver Bay for ] square demand. deals and South with growing OpenAI This as of [ District. of space [ and with related, are sublease includes Uber are requirements XXX,XXX sublease slack

seeing our assets, line increasing were assets the of in XX% The of tours in demand which levels, form tours. of We're our square increased XX%. with aggregate number already grew tenant strong across at sequentially, pre-COVID similar interest markets feet in while

AMPTP. a to strike of motivated closely we're writers SAG-AFTRA watching the the With of soon. September, with the resolved deal Both appear get as strike and progress done sides discussions

begin tours, productions leases on as stage we our agreement, well and prep. bookings experience We've seen as as a actors the in-place an positively revenue increase an occupancy used to expect to watch writers. increase production in preproduction rental offices an activity related reach both pickup by in especially Once impacting in for to

see start As of the service-related ramp-up well. filming we'll revenue resumes, our as to

With remains predict. the holidays approaching, difficult to the precise timeline

SAG However, production the quarter quarter level that we strike activity picking resolves first recovery expect in assuming up the and by next year. year-end, with of some normalized second through through the increased mid-November,

Vornado And venture purpose-built to business. we third studio in joint We closed our continue to the on first studio. and Pier build Sunset our with Manhattan's as on quarter, XX develop Blackstone

to a the brand expanded our marketplace Studios expansion been tax recently production Sunset high-priority and infrastructure has for credits. extended York New talent for due and established base,

with fee enhanced This X%. represents of only a $XX returns million approximately capital commitment,

Angeles. a businesses, the we done the and footprint our NOI, to in [ Quixote successfully city for akin full-service existing what city further in ] new expect building Beyond demand from to in platform New York just we've our project-level revenue drive Los

and vertically end-to-end exceptional integrated top-notch with an totally is vision service. Our facilities production solution,

focused sheet. balance and remain We on fortifying our also deleveraging further

Westside One 'XX material loans until no matures. maturities when our by secured have year-end We

proceeds from transaction million And assets, raised in in environment. the obvious reflect of team execution the third X our an California which tough by office sales $XX excellent we quarter,

year, thus yielded million reductions far, of ] have dividend [ Our savings. $XX this

a In to the by terms with of adding with dispositions, the all we currently have third, close X to year-end. contract assets potential of possibility under sell,

note in once is we've X-star year again ratings. year Assessment. and And consecutive Leader additionally, we've named earned that the fifth I'll Real GRESB earning Office rankings of Regional Sector Star Green Americas and been our top a third the the consecutive Estate This in

more business that and shareholders. proud values ways very for are create our continuing and to make our of team innovate We sustainable for our tenants in

going With to over that, I'm it turn Mark. to

Mark Lammas

Thanks, Victor.

square tenant the at XXX,XXX XXX,XXX feet gross signed North quarter. Met of third in the We activity Our of including in Park accelerated leases, nearly renewal our leasing again foot square Seattle.

strength increased for rents considerably longer markets. to deals. of the and new of but true results, signed is largely leases thanks Vancouver team, the X%, hard taking cash Seattle is the nearly leases are work to This These to due versus still our pre-COVID. especially positive signed in Our get

portfolio leases as dropped that over a basis XX% were X this our the third signed a we contributed. Occupancy by tenant attributable to Exposition points [ our result, XX XX%, move-outs we've expected, to with Market, out level percentage, as of quarter tenant lease the basis points Block's large healthy ]. decline more been move the similar Even XXX than last activity, a And approximately of within months of XXX renewals. relatively XXXX The which also and impacted in year. at XXX with sales has for discussed XXXX of Arizona

a foot the completed have XXX,XXX through that XXXX expiring, As in tenant extension XXX,XXX X we result feet. only Nutanix square and we specifically feet, to with XXXX, square expiration XXXX. for XXX,XXX renewal look lease, we square of over This is

million optimistic deals quarters. see our feet including stabilize in at portfolio XXX,XXX with leases we're late-stage to pipeline our to square the leasing Thus, or in in LOI, occupancy square and begin of recover feet, start coming X.X steady we'll

below We have X% our discussion on including coverage, are market. currently XX% which expirations, XXXX approximately in deals remaining

XXXX on XX,XXX our coverage XX% about expirations feet. square have over We

the at the to quarter ended tenant studios Las this is Sunset ownership studios. the for of uniqueness basis lease our because down strike. we've situation, lease Underscoring the points in-service single renew stages percentage Turning had XXX to due since leased Palmas approximately to XX% our The during this trailing percentage at on XXXX. opting at stages XX-month facility the a lowest of that at not X

basis not of Having leased strike's this quarter, acquired XX% Quixote long-term the the quarter in the third of which a is XX-month disclosing first last potential. stages obviously trailing asset's assets. trailing the includes Quixote for quarter indicative impact is therefore third the year, those were we're and XX-month the in on results

stages a X-year basis. Quixote on less short-term, That said, historically, leased been several than of have

foot to forward, assets for in-service going portfolio, expect lower comparatively occupancy per see ABR. leased predominantly could So long-term trended higher also those we versus square our but

square foot $XX Studios per $XX ABR was note, studios. opposed for Quixote to as for our the You'll in-service

benefit ramps we So there expect production rate, and to post-strike. between from is as activity which would a up trade-off occupancy

exceptional revenue Our our derived content non-strike continued do reality to Quixote from like leveraging team including has print services events. impacted job ads, short-form to a of productions, TV maximize large-scale stages and and

However, indicative as is same-store third similar performance. our underscore long-term revenue from of well Quixote from as quarter to potential far studio assets our occupancy, I'll

we contrast, services due have $XX NOI strikes. studio stages $XX generate approximately NOI cash activity million approximately generated combined that cash By our potential and our $XX NOI million million the of the once same-store estimate Quixote cash businesses of of normalized the of impact XXXX, studios to generated Year-to-date, annual to $XX to and the in production million resumes.

of annualized In and million based as $XX cash annual on same-store initial support to much for compared results. as the year-to-date $XXX short, studio potential just [ ], historical our performance Quixote estimates for NOI million

development, disciplined to staying we're our approach. in Moving

expected Our highly Los related. in-process remaining XX Glenoaks pipeline started differentiated minimal. is with year. studio of capital our Sunset Angeles end Studios to product in-process deliver is anticipated half are we've by of Studios York, end Nearly our New projects within noted, Sunset respective Victor of construction in delivery and as the in reflect markets, Pier XXXX. this on at commitments And the

continued in the and these strike's Clearly, assets. both potential to who accelerate we've tour leases. long-term quality and of show-by-show recognize exceptional resolution have tenants these Despite for activity who properties interest and uniqueness leasing strike, will the the

in development, year-end currently million other This tenant will of market, Lake X quarter with our be deliver Seattle. in With Downtown respect in the best first no for to product will XXXX of requirements only South year. are Washington There other through feet that square Triangle next in-process delivering Denny XXXX. the product Union,

added The residential hotel, mandates recently surrounding amenities. which retail combination neighborhood and of the is convention vibrant due completed center, and return-to-office to the

basis is comparable to trades XX% square only recent Our foot, to a XX% representing in discount years. $XXX per

And turn Harout. to I'll the call over now

Harout Diramerian

Thanks, Mark.

Hollywood, of reduction due communicated at services a Skyway revenue in XXXX revenue in to last Our Center, million union and the to Northview XXXXX sales primarily of and the as Plaza XXXX Washington million quarter year, other tenant was XXXXX third as the due and well compared $XXX.X related to quarter to strikes. Landing move-outs Skyport studio previously $XXX.X third

FFO, quarter last excluding quarter. specified quarter per $X.XX was no to the year. this million specified or $XX.X in Prior-year share totaled or million per diluted are specified items diluted $X.XX per items, $XX.X share. diluted third $X.XX compared items third Our share There for

change interest in associated tenant expenses and to expense. FFO Quixote higher sales year-over-year higher asset acquisition mentioned move-outs, The and attributable is operating previously with the

to share compared diluted or million the share, per million AFFO Our largely diluted attributable items $XX.X with per FFO. the previously affecting mentioned quarter third change was or $X.XX to $X.XX $XX.X

Harlow. cash Our strike. NOI a by Westside to Mark X up Las commencements reflects, and driven, same-store grew Palmas same-store on $XXX.X Sunset office studio the NOI at once due renew cash same-store NOI at cash X.X%, single tenant's significant not stages to year-over-year, decision decline lease up largely slightly with in again, the One XX.X% The million, as mentioned,

had of During placement funds the notes and revolving Glenoaks Westside, liquidity, loans. the end credit million and Sunset capacity cash construction E with Series private our capacity of undrawn of we of unrestricted our One unsecured facility. credit our under $XXX repaid $XX our quarter, revolving of million Pier quarter, million million There equivalents $XXX unsecured facility. $XX we additional $XXX XX Sunset from and is third comprised on At total million cash

our Centre debt new Bentall is expiration the capped. of share our of our fixed of associated The of XX.X%, of net a reduced company debt or capped of hedge, until the fixed pro forma percentage with is of was and would basis, for loan value our debt place. share in On XX.X% the put At a was the or debt to end hedge the and reflects fixed and complete XX.X%. book capped new quarter, undepreciated hedge percentage be refinancing the company

of ratable XX% share of our our on is our Bentall in as million. which maturities, completing asset, our refinancing process we're $XX.X noted, Regarding the upcoming Centre

matures which of Thereafter, our loan share December is by XX% through our XXXX, million. our XXXX only Two, and One remaining $XXX.X ratable Westside is Westside in expiration secured and which

Specific value covenants, to of the in per XX.X% to projections, percentage XX.X%, asset increase our quarter our remain to anticipated This increased expect our in from second and third was quarter. indebtedness unencumbered to we unsecured compliant. up the

outlook. our to Turning

have the don't and ramp-up While the of strike's we resolution, production. sufficient remain near-term still visibility in around we post-strike positive about the nature timing

to our related to studio-related continue approach on We XXXX providing outlook assumptions, our and FFO assumptions maintain office again, outlook. our certain

our office projection same-store from X% growth reaffirming to cash We're ranging X%. NOI

anticipate the our outlook year. we full-year always, we for XXXX dispositions, potential activity. when outlook report FFO and/or Should would year-end, next our of this fourth resolve results excludes any by strike quarter capital acquisitions, the As impact XXXX markets financings reinstating

questions. Now, we'll to Operator? take your be happy

Operator

Thank you.

will begin now Instructions]. question-and-answer We [Operator the session.

question first comes Piper from Alexander The Goldfarb Sandler. from today

Alexander Goldfarb

questions. first be with asset. the Bentall just sticking I'll So two

been with that that I given assume is they they've office Your in that like Blackstone to upped exiting New the a assets other of has busy Hudson here studio partner owned. just number studios York.

in? just Bentall to is look give and Vancouver? we for guys they're a stay guys Or if will that you to of sense exit an asset you this you should Can committed

Victor Coleman

is you their for how thank for portfolio. Blackstone I it's in the performed, this portfolio to their it's could on has currently, speak them their that don't Alex, entire our countless to asset office with -- understanding had this best be question. we've -- Yes, as And want conversations but asset.

remain And to asset look in engaged and move in and date, Vancouver they asset relationship prepared and this with to to are on sorry, with extend to continue Vancouver this and us. stay and to ownership this the plan fully the --

Alexander Goldfarb

always But $XX is, think overall. And not if or $XXX just then question Quixote, you I mentioned the I only versus sure Quixote million second was pronouncing -- guys Okay. it, million this about now trouble I'm potentially. that or have you're studios

asking how the that think on $XX based NOI I'm -- $XXX we of go? could to it the strikes resolving question So of put, as buildup again, you studios. comes especially the get million is and better Simply potential NOI million And understanding, just where about want a and you're sort the hopefully where now, now back. mentioned with

Victor Coleman

Sure.

just let and level, then Mark me jump and Jeff in. So top start can

we So the EBITDA it, know, in, this looking somewhere and around in million, is about it. you are can at that's of year the terms numbers, But if at as loss I you $XXX what of company X talk months the just we of strike okay? status mean, have for around for the now

implemented if ancillary the more were Quixote, cost year. months stabilize look moving we've South our XXX revenues like the our has that comments and the his last remarks, this would ] to out is prepared so and was which -- at and forward, of a combination be And that you businesses the we Lake Mark to throughout if X be savings of look [ -- broken prepared in that it is strike

Mark Lammas

business Yes, the I annualized see are that's obviously of terms shared the broken NOI year-to-date number you by in that out underpinning where prepared our studio mean on itself. of we mean nicely so so can remarks. -- Alex. I in we what's see it's sort can you segment,

I Alex, more trying and what potential idea others maybe what you an do to is is think we're give of is, the importantly, right?

that -- -- strike. XXXX is year assets last so the We had anticipation ], the for activity until a We same-store normalized up normal And in to at of month we production until of year. operating-type [ had the normal stages. started it curtail about our had occupancy pretty it's

So that's a right? pretty good benchmark,

Waggons result on the in, in team and basis. ]. somewhere of itself, we've [ his savings way and synergy-type top what eventually shared that Star we $XX we we've implemented -- improvements normalized and we've And EBITDA somewhere along a as the potential in the done will shared view Quixote million as Zio, we acquisition, line have Jeff believe, the think neighborhood

You combine that you NOI. get normalized, run prior that's pre-synergy of $XX that million of how with the $XX million $XX NOI, rate million to annualized to

those get that's if are that will, So contributors, XXX. to the you that --

Operator

at Capital Markets. question John next comes BMO from Our Kim

John Kim

at that if wondering Just an was was including sticking to September, XXX looking your NOI that contribution. the to And Waltham I go Cross presentation on not in uplift included ], U.K. in XXX [ developments. studios, update in NOI from was you project. just the there

Victor Coleman

cash for other we're around deal candidly currently, No. still phases at pricing I X Cross. not and going differential. design maybe the some start entitling, and We're date and phases, some it's underlying that's we've sizing not come and a But in yes. why back on mean, the -- to flow, in anticipated forward, going in Waltham on alternatives 'XX looking yet that's

John Kim

And revenue that Okay. current yields additional on expecting X on development any the include the does from you're that Quixote? developments,

Victor Coleman

good We balance and -- out. and it's a This No, is asset. just deal. straight good complicated very this no. Remember, That's -- Sunset we a a development it's question.

Glenoaks. number under an Pier XX is is the Quixote and both Sunset, then top Sunset of asset, a that And on that. asset different and business it's the operating enhanced So

the For go keep those all of we separate the in revenue we'll Quixote service it through, through assets. But Sunset-owned ownership, that to terms go on so returns. have we'll separate there's

John Kim

Okay.

to Quixote service studio that do rental you the So And the expect is just yield. yield studio?

Victor Coleman

yields XX, X that and Sunset was the that's studio in for Hudson. Pier on was remarks The the Yes. the just yield for

John Kim

My your final on question is dispositions.

on you in to amount commentary X yield? may the that this close dollar that X year. could provide mentioned the You Any

Victor Coleman

I appreciate No. asking. We that. just you don't do

Hopefully, closing, the share are we'll and and numbers we as assets have We get assets, be. the contract. to will the third the closer And X size. under X

Operator

Michael next Our Griffin at comes question Citi. from

Michael Griffin

just question Maybe leasing. a on

Is out -- these called You you confidence, that Vancouver L.A.? and more markets to something being Francisco give Seattle you're and relative and I in. seeing releases the strength markets about San relative that there guess,

Victor Coleman

general, and on start me Art's let here. sitting the So just then

Michael, in that. he So jump can on

Vancouver and pre-pandemic, past, absolutely as of direction, have either low. been small. very it's throughout moved rates in be The right? But the talked positioned been not pandemic in it's The the currently So has and vacancy markets. could best is consistent and rental one considerably yes, listen, very today, we've

Seattle X the What getting that from in generally in to shift has week now space we've up. in X-day Seattle when the of in gone area, and is both Bellevue seen going some workforce eaten a that is the high-quality

both Los say, those same size would right deals than, be And eaten have up lot a to markets, to about are specific more those announced that but don't of space Angeles seeing and now Los we're level a Angeles, available for that kind I in in there efficient in the space few markets, of quality are tenants. we being the

Art's a because I sitting demand underlying to slowed we're and strike Angeles, some the what's we where city of dramatically Los Angeles, and entertainment-related talk are now, here about a media until have back Los in right tone Plus, the things think But we running. in get and going we numbers. have up

So not it's itself overall people for in real the business, estate. growing just it's studio the industry

Arthur Suazo

seen And in grow the quarter-over-quarter same to X obviously, tech Francisco, most and lost mentioned, the the because demand the growth office, the and Also, mandates. really that Michael, of ] XX% year-over-year Victor hold over really of It's shown Seattle, really market in with demand, [ right? growth of growth last back it's to tech. users has into probably because ground's more as following with quarters, really San not that in the more XX% reason, coming starting the take really, that return we've

and relative pandemic the driving have strike. Los level that Entertainment start were see stated about talking numbers reasons to Angeles, media, Victor very Angeles modest with driving through but market still come it portfolio, and regards we'll and of Los the activity. back, been keeping it's really really healthy. And and our those to only In the to very, we're West

Michael Griffin

helpful. if That's on I Great. one And question occupancy, then can. maybe

I we levels heading there read that of a occupancy, think Mark, for as provide of kind prepared stabilized Anything in be alluded helpful. would can flat to Should expectation his into you there? XXXX. current kind remarks, from

Mark Lammas

that into the of large over little very of shows mean steady sort be the 'XX. head X we what if improvement, years actually, forecast will even XXX,XXX we've from the 'XX will, into expirations, I into feet. only Our as we mentioned to also expirations you experienced shift, and X.X the past over year --

pipeline matches the well demand That of the really, with coming really in is terms where from.

yes, expect and see to for the essentially on we So steady foreseeable from improvement future. here out

Operator

Caitlin of comes Our Sachs. Burrows from next Goldman question

Caitlin Burrows

So whether a and about. ] [ had on have will strike writers strike. the wondering you've that's strike, we've view I'm actors anything heard if you if cruise

Victor Coleman

[ Cruise year. ], next

typically Next like haven't at -- and like year, in No, heard this And been Guild have yes. the they Directors But I move resettled in with mean more prior, [ about anything I know more ] too. stage. they what happens, Caitlin, that typically settle line. mean, you right? never line we they

I -- WGA, with are we're two way. and I obviously industries always biggest as in The led strike said, the would looking and a they've to. to unique timeline, multiple SAG-AFTRA

we've happen. heard far won't that But hopeful we're today, So nothing. so

Caitlin Burrows

of actually and remain, worst quarter, the quarter, that through 'XX you Okay. in of points limit. marked over also, the tested end even And then you covenants would you XXX that clear mentioned guys basis the had stress last your Harout

just points covenant. indebtedness asset you remaining to XXX basis have buffer the value on now So unencumbered unsecured

test in mentioned trend, So it of exceeded forward, your might could ability forecast through wondering kind confidence and have you last that? if and why quarter that go to the going that stress you

Harout Diramerian

would are -- it's one-time it that still we it that in and Yes. are expectations, largely our there own -- get have calculation, is excluded items complicated although I There's what we to say. gross numbers uses trailing in materially a are fairly line with line, -- mean I stop. get so

the basis XXX I of your point regarding sort do points. appreciate

it, As we still compliant. we stress test remain to number and are we're going look at we've the confident

of than in we're our we So and more to they're all mentioned through it, looking add the expectations, projections, compliant. there's sales focused I'm factored not we're can sure remain Victor we we running other expect that on at of leasing much earlier, our all

Operator

comes Our Blaine from Wells question next Fargo. at Heck

Blaine Heck

do increasing up your side what side? But So away from help I of on income balance just income equation, on just about taking I some sheet the covenants them. certainly metric of would options the thinking on guess, some your out to of and the following you bring the limit, understand can

kind does at confirm is the your looked you rest down puts violation. you secured be if if Or into media that in Have helpful. that, you just this of down you it'd draw But really believe possibility? line, I on of could a point? portfolio, the any additional to debt come dispositions that it

Mark Lammas

There's can unsecured more to contributor, good the mentioned expect the than metrics already are that -- dispositions and we've accretive dispositions -- we a to I mean be on...

Victor Coleman

looking We of also that we have around or part other portfolio feasibility liquidity that that, not mentioned, that assets Blaine, are a [ amount are in enhances past the options in credit the which well. of as fair we've ] at the facility

Mark Lammas

reify Blaine, just Yes. just Yes. maybe other disposition. point, beyond levers, just ] there are that And [

assets metrics, run sorry, that would through we put accretive. that assets on don't unencumbered be that there's -- the put -- -- that I could debt unencumbered could we that there's So could mean we put there's

that would metrics. other have we estate real assets we own those. assets, to -- to not the they be notes. the are are accretive There ability Those Those are are sell

on all number sales are will, a pull improve -- asset if you there So would can are metrics. that those of beyond -- levers, we that

Blaine Heck

talk about of leases was right in leases have whether shorter that prevalent Okay. pipeline skewed the That's have the terms Can that downward? anything signed you was whether well? you term on the helpful. that, there And significantly in might during X I the as quarter normal, are We shorter specific kind than years. around just think, those noticed

Arthur Suazo

sequential prevalent. transactions. X decrease Blaine, was it's Arthur. primarily they're X the to No, -- Listen, really not due

office square we the to The which foot square in And accommodation tenant to keep long did Square, Denny the lease use term. first as again, XX-month a XXX,XXX foot second intent on Pioneer a Triangle, with transaction the on XX,XXX the in further extension to extend was try an downstream. the was X-month, expiration

combined the about was -- weighted line average these weighted with X effect prior right lease lease months. average deals, our With of XX.X in term average of term the X quarters

So yes, was was a and explanation. there outliers, couple of the that

Blaine Heck

All right. the to And that then you kind separate? leasing Glenoaks? of Sunset tenant last kind launched Las And given studio of competitive tenants that up is the point or on now one, side segment? they your how does for Palmas, that within at focus at the are ability guess, lease affect properties this I the your going same

Victor Coleman

because we I there Blaine, get So they out. And production. listen, been tenant they had right a to lost stopped a mean, that's

the And on vacancy strike. in in is same. ownership Bronson in first we've of That's the the that so based was had time Glenoak, it a the and canceled and history that of Gower quite show ever asset, frankly,

And the interest activity to It's very Glenoaks its the I of -- Glenoaks. first purpose-built kind it's the surprisingly mean and of high. high. facility, not has interest competitive is is on very been a the

comfortable I mentioned that I up I this and purpose-built very a that we're over, is the have this and already And is is trend, activity writers, the not demand. running. strike a highest When As actor mean, my in think facilities will we're around prepared in remarks, time. moment rooms seeing

will show and at we forward. to and left going have a like just company call that that's going the all options Glenoaks Palmas, us Las in there, of company first we'll put is want Quixote And guess have the be our facilities. at to options My us parent

Operator

Anderson from Our Wedbush. next is question at Rich

Rich Anderson

back this business have longer-term do Or more theme won't your of of rolling kind you good you step something a of the out do come or guys an short-term the sort times think as actors you leases situation, market at converting to think the give has work? to to absorb to you of business into you I have you'll in exit get couple get work want know back So But and that outset really continue away this the could up that studio that done leases. to have and strike of again? now. be as of topic more

Victor Coleman

in know of over, said I don't Rich, going to the is, when and we'll see think is decision in consistently and tree fact tremendous we'll to forward upswing functions, matter what the we're in we we long short decide think or the for away, term is term I most a are but activity the whether forms all equitable the give us move past strikes on.

various to a jump in going I bit getting for the already the -- we're sales a Jeff are and have of lot options. lots inflows We think I can having seeing, he's team little talk they're have about but options. side what of different sales on and

extremely I over We not of show look started and best economic the this industry prepared long-term And afraid that. think flipped either We term. at that. we with been what's on to we've leases, show, successful and and did were We're extremely to one. successful we're on

time, been higher of revenue know is mentioned a part this than we've and leases. long which that to much -- long-term we've mentioned this, so you've Candidly, you a show should stream show for

I comfortable prepared we so and either with And think are direction.

bear hopefully I want which we And I because stabilized are to think to out going be get revenue, in the to on in are activity back numbers said, as sales? the over strikes will there's seen. you do jump going be, the to soon a Jeff, upswing as tremendous and

Jeff Stotland

in relationships us it of differentiator It and a booked a industry really show-by-show that our company I like with succeed. studios really understanding add I the have go that, just the greenlit, when in we how we a separates ours because with think Yes. get model, Rich, good as all a shows whole would enables process. to team capable

a lease Whereas studio going is long-term who got one-off doesn't save those sort is a anybody who's relationships, going just trouble. more have them, to development, hoping of to have

think capitalize I that. business in we're And we're So building show advantage situation actually a how to industry that's really back by on competitive goes predominantly when the show. to the

Rich Anderson

Okay.

vacant that you on [ sort level the completely for and related at unrelated? you known to question. any Warner that studio just systemic next industry, about view see did observation Second a business Brothers of does the Douglas ] content overall? but pause you, perhaps the longer-term give as Emmett year, not has about Or

Victor Coleman

they're I I whatever interest and feverish we're and million Brothers, around quarter of write-off like their can't making, activity of comment else I occupancy as Totally and Warner $XXX I growth. think. It's comment last decisions can't said, content a either and unrelated, seeing studio candidly. on on --

got Netflix Cinemax who looking But that Showtime room. and Paramount they're for Apple markets ABC CBS in of and and else, NBC not Disney and part [ the and our the rate everybody Amazon and think markets in only HBO and and animal space and and We've in and and and we're ]. And around and world. parcel that's other growth were I just the content the

Rich Anderson

is Monmouth last where area. imagine in least York a starting there. on me New the very There's live interesting Jersey. I sort -- expansion in very of close at Netflix that then that's -- And metropolitan for development to in and But City, I is going New Okay. for a you point Fort

kind for New What the you set I'm growth a term? you curious, see, you, metropolitan do City much of forward? see story opportunity area just as longer York how going

Victor Coleman

is, to that the team buy in marks facility not purpose-built York marketplace New get being a the eager in of I upswing. is Manhattan. into. think for will been first a that disciplined prepared city of I on to mentioned marketplace, high give my kind the be in the as I and This its very remarks, we've

their which an look a entree venture as with And interest to markets I think other there level is of in some Blackstone, other result and our that, it at give opportunities as will us well. for

right Brooklyn that Zio now, said, we're be ends all X-year the discipline and in of already outside our And business in focused of This going to at and the see something the we'll Star the But been surrounding in making. is through day, and evaluate forward. other cetera, opcos is the that with I areas on. our that in has and areas, been positioned we've to doing the York very that disciplined. continue and and likes at Quixote up, Queen Waggons studios and which Bronx, et and of New a As deal the team, end

Operator

next Ron Morgan Kamdem from Our Stanley. question of

Ronald Kamdem

ones. quick Two

of to Quixote calculation? question, right? that the for back it, that are Or figure covenant the even hurdles what actually is help. of to would some to that But the taking to going adding realistic? Just to calculation, into presumably, are the different some what get at Because a the out, trying hurdles take just

Mark Lammas

the that we the facility X I was operating anticipate through of time ]. realistic. small in through not amenable it relatively lenders that that our at line it describe the ]. We did what hurdle. flowing growth businesses. running It The of a It's we is sight time [ business. of reset [ TAV were wouldn't 'XX, TAV to At to had our as part

did And so potential the we that metrics, have. not impact could those through, unencumbered anticipate the for

businesses those that are amazing would We're grew they aware in very we that factored metrics. those been growth, type and contact unencumbered constant them. They anticipated with lenders, that have with into of our had relationships have

calculations, metrics to there opportunity And into unencumbered And metrics, watching forth. amenable time so our to an they're that I we're and and our and the may that. be those pull do think a

Ronald Kamdem

on Helpful. that's XXXX on done. want And pre-leasing to gears, Washington switching then Obviously, I no on comments follow just up delivering ] [ XQ.

a kind getting more pulse be curious any any sort -- there, there of those color And Just of what is reasonable activity activity looking, of there? leases signed? would sense expectation LOIs? the for sort tenants or on first Just what

Arthur Suazo

Yes.

], [ newest yes, It's best-in-class First all, building we're market. but really of right situated the now. in market pre-lease very the well it's not

through In 'XX. addition end deliveries to of are other no the there that,

well we're situated. very again, So

turn, in mentioned sublease one questions, we're desirable, it's of Victor space, an other to leased up and up see in about going to read uptick which starting CBD the deals on ticked across the makes get again. early the Bellevue. our more of here, quality interest you'll large There's tours. a lot And in As quarters, even in it's following us and

Operator

Our from is next from question Tom BTIG. Catherwood

William Catherwood

mentioned? early -- any how to in you start the preproduction color, users driving though, studio commentary approved advance you on in on activity the I space? that provide beyond has ] back planning to production studios, far the process is activity. some And pickup lock preproduction discussions with appreciate in the Sticking Victor [ your more just with Can

Victor Coleman

There and can't the nor remember, what the is Tom, And sound that. scripts, SAG-AFTRA working question. tell can they. they [ ] great is start writers ] but science I and the stages are office certainly you they you well done, likes on would [ can't no done. facilities until seeing. strike can sign on of that, here that a that writers can space strike, we're on Albeit are entertain even signing sign

So we sit. that's where

to be X what first, third I we've Let to can that. then as jump commented, were how sort are activity now X it -- end weeks shows they're looking today, around ratify if of it would would at to of But me weeks and and another Jeff it, have the strike going sort of second, be X in.

would that and they and everybody have And so else's come stages at availability. then opportunities look ours at

January won't happen moment that ] space in of outlining get even could next on on, until better the from economics a holiday likes months, a the in editing X. side. and ] But quarter X with if my approximately, X holidays, and for first be there they full opinion, running next quarters anticipating And year we're the been things they've the and of though year get going why on mill quicker. timeline probably [ we for and That's [ that up preproduction would

William Catherwood

appetite response that it. Really investments is then monetize media the the your the Got Mark, on up portfolio bonds you And Hollywood question, Blaine's covenant second to levers what or maybe, to on incremental either mentioned to delevering? in helpful. retained fund following question, potentially

Mark Lammas

liquidity it's to And I and guess unfold. at interesting worth how liquidity, it I leave It's mean see I metrics. We'll source potential exploring. of just I'll that. things think an opportunity have to other improve the create something

Operator

Street. question from Green from Dylan is The next Burzinski

Dylan Burzinski

activity occupancy level the XXXX, of are embedded expectations leasing sort going those and I expectations? next, able to of you the over share to to new back in guess just call is what it, XX months

Mark Lammas

we so been end asked ideas time. haven't forth. Not of type -- leasing -- kind leasing, mean, of to where I historically, we've wrong We've caused make. I our at the what tried our question. at this think this probably I up it's I people progress we mean, give we activity, certain of and might points haven't -- the of understanding

when of that leases. metric. that of going of -- peers Maybe a don't kind I request know don't But as I new be might consider think adopt quite going don't worth will considering ranges time for something imagine something it or it's as reguide, renewal. our your terms some I be -- to new granular we're to it's that we pinpointed as as that. it's do it's occupancy in like versus to

Dylan Burzinski

sort helpful. if then more. one for just just footprint, across comment rents? fair. going by broad able net expectations would market. guess That's it's And be you effective Are your differ strokes obviously, And I you to on to of go can But that

Mark Lammas

net keeping an held I'm sure I eye have mean they've on that how you're effectives Well, mean, I well. trended.

we're latest go X%. like I think so point, trailing XX on QX pre-pandemic, line essentially activity, basis down the XX with trailing if that down I we're at in think you trailing a we're XX, --

a They've on held slightly of but every don't provide don't the anyone below, basis. sometimes net up. effect we think effect, I was net net a held almost Again, above, at, up quarter, we're forecasting sort provides sometimes effective target some

Arthur Suazo

the because changes composition quarter-to-quarter. Chiefly

Operator

Scotiabank. comes last from from call Our the question Nick Yulico on

Unknown Attendee

This is for Nick. [ Garik ] Dan on

How Just you for thinking leverage. improved one occupancy assets and on with balancing selling about question an are expectation leasing?

years. you'd the million the to the that close next longer-term pretty net lost Xx from You're math, maturity set ladder EBITDA business, And of back-of-the-envelope be if on you over debt targets. well few up had $XXX the studios

be So great. thoughts would there any

Mark Lammas

off, I mean the how constantly expiration. a view that. composition, on We're prospects lead say we're we're tenant is relatively the assets what lease, the that's precisely -- backfill, looking maybe the that the and lease doing. term at if balancing have early your is question its I'd we for and remaining

what every Drew it what looks I just expectations sale of just it's the team expire, like, when would be, has of asset his his and like team amazing looking looks namely, -- thus does is, job what potential every how account And the balancing cost done exactly like our element taking -- what constant and are of the right every think an balance far, striking act. if into downtime And retaining a it that, it at time.

Victor Coleman

Great.

everybody's in and you seeing next, forward it. this I the think Thanks in very [ operator. fourth ] to quarter. much, Appreciate that's look participation quarter, we

Operator

concluded. now has conference This you. Thank

You may now disconnect.

Hudson Pacific Properties (HPP) 2 Nov 232023 Q3 Earnings call transcript