Hudson Pacific Properties (HPP) Q1 2025 earnings summary

Executive summary

• Achieved 630,000 sq ft of new and renewal leases in Q1 2025, the highest since Q2 2022, including a 232,000 sq ft, 20-year lease with the City and County of San Francisco at 1455 Market; new leasing accounted for 66% of activity.

• Portfolio included 14.3M sq ft of office, 1.7M sq ft of studio, and 3.2M sq ft of undeveloped land as of March 31, 2025.

• Office and studio fundamentals showed signs of stabilization and improvement, with strong AI-driven demand in San Francisco and robust studio leasing pipeline.

• Non-core asset sales generated $97 million in liquidity, with further dispositions of $125–$150 million targeted.

• Ended quarter with $839 million in liquidity, including $86.5 million in cash and $752 million in undrawn credit.

Financial highlights

• Q1 2025 revenue was $198.5 million, down from $214 million year-over-year, mainly due to asset sales and lower office occupancy.

• Net loss attributable to common stockholders was $80.3 million for Q1 2025, compared to $53.4 million in Q1 2024, impacted by one-time lease termination fees and a non-cash impairment.

• FFO, excluding specified items, was $12.9 million ($0.09/share) vs. $24.2 million ($0.17/share) a year ago; FFO attributable to common stockholders and unitholders was $3.1 million, down from $22.0 million.

• Same-store cash NOI was $93.2 million, down from $103.4 million year-over-year.

• Studio revenues were $33.2 million, $2.2 million lower due to production pauses and fires.

Outlook and guidance

• Q2 FFO per diluted share expected to be $0.03–$0.07, reflecting lower office NOI and higher interest expense, partially offset by higher studio NOI and lower G&A.

• Full-year 2025 guidance assumes same-store property cash NOI decline of 12.5% to 13.5%, with interest expense guidance increased by $12 million and G&A expense guidance reduced by $3 million.

• Occupancy expected to stabilize and improve from Q3 onward as expirations taper.

• Lease-up of recently completed and under-construction developments is expected to drive near- to mid-term cash flow growth.

• No material changes to risk factors or guidance since the 2024 Annual Report.