LOS ANGELES--(BUSINESS WIRE)--
Hudson Pacific Properties, Inc. (the “Company”) (NYSE: HPP) today
announced financial results for the fourth quarter and full year ended
December 31, 2012.
Financial Results
Funds From Operations (FFO) (excluding specified items) for the three
months ended December 31, 2012 totaled $11.6 million, or $0.23 per
diluted share, compared to FFO (excluding specified items) of $9.2
million, or $0.25 per share, a year ago. The specified items for the
fourth quarter of 2012 consisted of expenses associated with the
acquisition of The Pinnacle office property in Burbank, California of
$0.2 million, or $0.00 per diluted share. Specified items for the fourth
quarter of 2011 consisted of expenses associated with the acquisitions
of 6922 Hollywood Boulevard in Los Angeles, of $0.9 million, or $0.03
per diluted share. FFO including the specified items totaled $11.4
million, or $0.23 per diluted share, for the three months ended
December 31, 2012, compared to $8.3 million, or $0.23 per share, a year
ago.
The Company reported a net loss attributable to common shareholders of
$5.9 million, or $(0.13) per diluted share, for the three months ended
December 31, 2012, compared to net loss attributable to common
shareholders of $3.2 million, or $(0.10) per diluted share, for the
three months ended December 31, 2011.
“We concluded 2012 with a very strong fourth quarter that included a
significant acquisition and substantial leasing activity, particularly
at our San Francisco properties,” said Victor J. Coleman, Chairman and
Chief Executive Officer of Hudson Pacific Properties, Inc. “During the
quarter, we announced the formation of a joint venture to acquire The
Pinnacle, a two-building, 625,640 square foot, Class-A property located
in the heart of the Burbank Media District. This property is extremely
complimentary to our portfolio and will provide our Company with an
immediate foothold in one of the top media and entertainment markets in
the country. We also enjoyed unprecedented leasing activity throughout
the fourth quarter with the execution of 705,905 square feet of new and
renewal leases in the quarter, including a 246,078 square foot lease
with Square, Inc. at our 1455 Market Street property (which has since
expanded to 327,432, as described more fully below), a 235,733 square
foot lease with salesforce.com at our Rincon Center property, a 54,763
square foot lease with GitHub for our entire 275 Brannan Street
property, and a 17,521 square foot lease with Hotel Tonight, Inc. at our
901 Market Street property.”
Fourth Quarter Highlights
-
FFO (excluding specified items) of $11.6 million, or $0.23 per diluted
share, compared to $9.2 million, or $0.25 per share, a year ago;
-
Entered into a joint venture to acquire The Pinnacle, a two-building
(Pinnacle I and Pinnacle II), 625,640 square foot, Class-A property
located in Burbank, California. The acquisition of Pinnacle I closed
on November 8, 2012 for a purchase price of $212.5 million. The
acquisition of Pinnacle II is expected to close later this month;
-
Completed new and renewal leases totaling 705,905 square feet;
-
Stabilized office portfolio leased rate of 93.5% at December 31, 2012;
-
Obtained a loan for our 275 Brannan Street property with the ability
to draw up to $15.0 million to fund costs associated with the
renovation and lease-up of this property;
-
Obtained a loan for our 901 Market Street property, $49.6 million
which was funded at closing, with an additional $11.9 million
available to fund costs associated with the renovation and lease-up of
this property;
-
Obtained a $129.0 million loan for Pinnacle I to finance a portion of
the purchase price;
-
Declared and paid quarterly dividend of $0.125 per common share; and
-
Declared and paid dividend of $0.52344 per share on 8.375% Series B
Cumulative Preferred Stock.
Combined Operating Results For The Three Months Ended December 31,
2012
Total revenue during the quarter increased 22.1% to $45.2 million from
$37.1 million for the same quarter a year ago. The increase in total
revenue was primarily attributable to a $5.3 million increase in rental
revenue to $31.7 million, a $1.4 million increase in other
property-related revenue to $3.9 million, a $1.0 million increase in
parking and other revenue to $2.9 million, and a $0.5 million increase
in tenant recoveries to $6.7 million. The increase in rental revenue,
parking and other revenue, and tenant recoveries largely reflects the
acquisition of office properties during second and third quarters of
2012, a full quarter of operating results from the 6922 Hollywood
Boulevard office property acquired on November 22, 2011 and partial
quarter impact of the Pinnacle I acquisition on November 8, 2012, though
higher rents and occupancy at the Company’s media and entertainment
properties also contributed to the higher rental revenue. The increase
in other property-related revenue reflects stronger production activity
associated with higher occupancy at the Company’s media and
entertainment properties.
Total operating expenses increased 29.8% to $43.0 million from $33.1
million for the same quarter a year ago. The increase in total operating
expenses was primarily the result of a $6.0 million increase in
depreciation and amortization to $17.6 million and a $3.3 million
increase in office operating expenses to $15.4 million, in both cases
primarily attributable to the acquisition of office properties during
second and third quarters of 2012, the full quarter impact of the 6922
Hollywood Boulevard office property acquired on November 22, 2011 and
partial quarter impact of the Pinnacle I acquisition on November 8,
2012, and a $1.0 million increase in media and entertainment operating
expenses to $6.3 million, resulting from higher production activity and
occupancy at the Company’s media and entertainment properties compared
to the same quarter a year ago, all partially offset by a $0.3 million
decrease in general and administrative expenses to $3.7 million.
As a result, income from operations decreased 43.3% to $2.2 million for
the fourth quarter of 2012, compared to income from operations of $3.9
million for the same quarter a year ago.
Interest expense during the fourth quarter increased 20.3% to $5.1
million, compared to interest expense of $4.2 million for the same
quarter a year ago. At December 31, 2012, the Company had $582.1 million
of notes payable, compared to $359.5 million as of September 30, 2012
and $399.9 million at December 31, 2011.
Segment Operating Results For The Three Months Ended December 31, 2012
Office Properties
Total revenue at the Company’s office properties increased 19.6% to
$34.5 million from $28.8 million for the same quarter a year ago. The
increase was primarily the result of a $4.4 million increase in rental
revenue to $25.4 million, a $1.1 million increase in parking and other
revenue to $2.8 million, and a $0.2 million increase in tenant
recoveries largely reflects the acquisition of office properties during
second and third quarters of 2012, a full quarter of operating results
from the 6922 Hollywood Boulevard office property acquired on November
22, 2011 and partial quarter impact of the Pinnacle I acquisition on
November 8, 2012.
Office property operating expenses increased 26.8% to $15.4 million from
$12.1 million for the same quarter a year ago. The increase largely
reflects the acquisition of office properties during second and third
quarters of 2012, a full quarter of operating results from the 6922
Hollywood Boulevard office property acquired on November 22, 2011 and
partial quarter impact of the Pinnacle I acquisition on November 8, 2012.
At December 31, 2012, the Company’s stabilized office portfolio was
93.5% leased. During the quarter, the Company executed 17 new and
renewal leases totaling 705,905 square feet.
Media and Entertainment Properties
Total revenue at the Company’s media and entertainment properties
increased 30.7% to $10.8 million from $8.3 million for the same quarter
a year ago. The increase was primarily the result of a $1.4 million
increase in other property-related revenue to $3.9 million and a $0.9
million increase in rental revenue to $6.3 million, resulting from
higher production activity and higher rents and occupancy at the
Company’s media and entertainment properties compared to the same
quarter a year ago.
Total media and entertainment operating expenses increased 18.1% to $6.3
million from $5.4 million for the same quarter a year ago, primarily
resulting from higher production activity and occupancy at the Company’s
media and entertainment properties compared to the same quarter a year
ago.
As of December 31, 2012, the trailing 12-month occupancy for the
Company’s media and entertainment portfolio increased to 73.7% from
70.1% for the trailing 12-month period ended December 31, 2011.
Combined Operating Results For The Full Year Ended December 31, 2012
For the first twelve months of 2012, total revenue was $166.2 million,
an increase of 16.9% from $142.2 million in the same period the prior
year. Total operating expenses were $151.4 million, an increase of 21.3%
from $124.9 million in the same period a year ago. As a result, income
from operations was $14.7 million, compared to income from operations of
$17.3 million for the same period a year ago. The Company had $1.1
million of acquisition-related expense during the year of 2012, compared
to acquisition-related expense of $1.7 million for the same period a
year ago. Interest expense during the year of 2012 increased 9.1% to
$19.1 million from $17.5 million in the same period of 2011.
Balance Sheet
At December 31, 2012, the Company had total assets of $1.6 billion,
including unrestricted cash and cash equivalents of $18.9 million. At
December 31, 2012, the Company had total capacity of approximately
$204.1 million on its $250.0 million unsecured credit facility, of which
$55.0 million had been drawn. Following the end of the fourth quarter,
the Company used proceeds from the common stock offering described below
to fully repay the outstanding balance under its unsecured revolving
credit facility, as a result of which nothing is currently drawn under
that facility.
Acquisitions
On November 8, 2012, a wholly-owned subsidiary of the Company, Hudson
JW, LLC, a Delaware limited liability company (“HJW”), entered into a
joint venture, P1 Hudson MC Partners, LLC, a Delaware limited liability
company (the “Pinnacle JV”), with Media Center Partners, LLC, a
California limited liability company (“MCP”), to acquire The Pinnacle, a
two-building (Pinnacle I and Pinnacle II), 625,640 square foot, office
property located in Burbank, California. Pinnacle I is a 393,776 square
foot building that, immediately prior to the transactions described
below, was held by a joint venture between MCP and an unrelated entity
(the “Prior P1 Majority Owner”), in which MCP held approximately 5% of
the ownership interests. Pinnacle II is a 231,864 square foot building
owned by an affiliate of MCP, Media Center Development, LLC, a Delaware
limited liability company (“MCD”). The Pinnacle I building was purchased
by the Pinnacle JV for a total gross purchase price of $212.5 million
(before closing costs and prorations). In order to effectuate that
purchase, HJW contributed approximately $83.0 million to the Pinnacle JV
and the Pinnacle JV obtained a $129.0 million ten-year project loan.
MCD is expected to contribute the Pinnacle II to the Pinnacle JV
building upon the satisfaction of certain closing conditions, including
lender approval of the assumption of an existing $89.2 million project
loan. While no assurances can be made with respect to the timing or
success of satisfying the conditions to the contribution of Pinnacle II
to the Pinnacle JV, the Company anticipates the satisfaction of those
conditions to be completed by the end of the first quarter of 2013.
Other than for purposes of funding closing costs and prorations, HJW
will not be required to make a capital contribution in connection with
the contribution of the Pinnacle II building to the Pinnacle JV, but
HJW’s ownership interest in the Pinnacle JV will be adjusted to reflect
the contribution by MCD of Pinnacle II such that upon its contribution
the combined ownership interest of MCP and MCD in Pinnacle JV shall
become approximately 35%, with the remaining approximately 65% owned by
HJW. Upon completion of the transaction, the joint venture will own both
buildings for a combined purchase price of approximately $342.5 million,
subject to approximately $218.6 million of project-level financing.
Financings
On October 9, 2012, the Company closed a three-year loan with Wells
Fargo Bank, National Association, secured by the Company’s 275 Brannan
property, which upon full disbursement, will total $15.0 million. The
loan bears interest at LIBOR plus 200 basis points and will mature on
October 5, 2015, provided that the Company may extend such maturity for
one additional year subject to satisfaction of certain conditions.
Proceeds from the loan are expected to be used to fund base building,
tenant improvement, and leasing commission costs associated with the
renovation and lease-up of this property to Github, as described below.
On October 30, 2012, the Company closed a four-year loan with Wells
Fargo Bank, National Association, secured by the Company’s 901 Market
Street property, $49.6 million of which was funded at closing, with an
additional $11.9 million available to fund base building, tenant
improvement, and leasing commission costs associated with the renovation
and lease-up of this property. Upon full disbursement, the loan will
total $61.5 million. The loan bears interest at LIBOR plus 225 basis
points, until such time as the property achieves a trailing six-month
9.0% debt yield, at which time interest is reduced to LIBOR plus 200
basis points. The loan will mature on October 31, 2016, provided that
the Company may extend such maturity for one additional year subject to
satisfaction of certain conditions.
On November 8, 2012, the Company obtained a $129.0 million ten-year
project loan to finance a portion of the acquisition of Pinnacle I. The
loan bears interest only for the first five years at an interest rate of
3.954%. Beginning with the payment due December 6, 2017, monthly debt
service will include principal payments based on a 30-year amortization
schedule. The loan will mature on November 7, 2022.
Offerings (subsequent to quarter end)
On February 12, 2013, the Company completed the public offering of
8,000,000 shares of common stock and the exercise of the underwriters’
over-allotment option to purchase an additional 1,200,000 shares of our
common stock at the public offering price of $21.50 per share. Total
proceeds from the public offering, after underwriters’ discount, were
approximately $189.9 million (before transaction costs). The Company
contributed the net proceeds to its operating partnership, which then
used $60.0 million of the net proceeds to fully repay the outstanding
balance under its unsecured revolving credit facility. The operating
partnership intends to use the remaining proceeds to fund development or
redevelopment activities, fund potential acquisition opportunities, and
for general corporate purposes.
Leasing Activities
On October 10, 2012, the Company signed a lease at its 901 Market Street
property with Hotel Tonight, Inc., a leading on-line hotel room
reservation company. This new lease encompasses 17,521 square feet for a
term of six years and commenced in December 2012.
On October 19, 2012, the Company signed a lease at its 1455 Market
Street property with Square, Inc., a leading electronic payment service
provider that enables credit card payments through mobile devices. This
new lease now encompasses 327,432, including 246,078 square feet of
initially committed occupancy and a 81,354 square foot expansion option
that the tenant has now exercised. 181,805 square feet is scheduled for
commencement in March, 2013, 15,741 square feet is scheduled for
commencement in July, 2013, and the remaining 129,886 square feet is
scheduled for commencement in early 2014. The lease backfills 238,367
square feet of space currently occupied by the project’s largest tenant.
On December 28, 2012, the Company signed a 54,763-square-foot lease for
the entire 275 Brannan Street property located in San Francisco’s South
of Market Area (SoMA) with GitHub, a leading provider of web-based
hosting services for software development projects. 275 Brannan Street
is currently vacant and has been under renovation since the Company
acquired the property in September 2011. Commencement of the lease with
GitHub is scheduled for early April 2013.
On December 28, 2012, the Company signed a lease at its Rincon Center
property in San Francisco with salesforce.com, an enterprise cloud
computing leader that helps companies connect with customers, partners
and employees through social and mobile cloud technology. The 235,733
square foot lease backfills nearly 190,000 square feet of currently
occupied space, including approximately 148,375 square feet occupied by
AT&T scheduled to expire on August 31, 2013, and takes an additional
approximately 39,738 square feet of currently vacant space. Occupancy
under the lease is staged, with 93,028 square feet scheduled for
commencement in November 2013, 59,689 square feet scheduled for
commencement in May 2014, and the remaining 83,016 square feet scheduled
for commencement in August 2014.
Dividend
The Company’s Board of Directors declared a dividend on its common stock
of $0.125 per share and on its 8.375% Series B Cumulative Preferred
Stock of $0.52344 per share for the fourth quarter of 2012. Both
dividends were paid on December 31, 2012 to stockholders of record on
December 20, 2012.
2013 Outlook
The Company is providing full-year 2013 FFO guidance in the range of
$0.90 to $0.94 (excluding specified items) per diluted share. This
guidance reflects the financing and leasing activity referenced in this
release and all previously announced acquisitions, including the
anticipated contribution of the Pinnacle II building as described above
(but excludes acquisition-related expenses associated with that
acquisition). This guidance also reflects the February 2013 common stock
offering also describe above. As is always the case, the Company’s
guidance does not reflect or attempt to anticipate for any impact to FFO
from speculative acquisitions. The full-year 2013 FFO estimates reflect
management’s view of current and future market conditions, including
assumptions with respect to rental rates, occupancy levels and the
earnings impact of events referenced in this release, but otherwise
exclude any impact from future unannounced or speculative acquisitions,
dispositions, debt financings or repayments, recapitalizations, capital
market activity, or similar matters.
Supplemental Information
Supplemental financial information regarding the Company’s fourth
quarter 2012 results may be found in the Investor Relations section of
the Company’s Web site at www.hudsonpacificproperties.com.
This supplemental information provides additional detail on items such
as property occupancy, financial performance by property and debt
maturity schedules.
Conference Call
The Company will conduct a conference call today to discuss the results
at 1:30 p.m. PST / 4:30 p.m. EST. To participate in the event by
telephone, please dial (877) 407-0784 five to 10 minutes prior to the
start time (to allow time for registration) and use conference ID
408474. International callers should dial (201) 689-8560 and enter the
same conference ID number. The call will also be broadcast live over the
Internet and can be accessed on the Investor Relations section of the
Company’s Web site at www.hudsonpacificproperties.com.
A replay of the call will also be available for 90 days on the Company’s
Web site. For those unable to participate during the live broadcast, a
replay will be available beginning March 6, at 4:30 p.m. PST / 7:30 p.m.
EST, through March 13, at 8:59 p.m. PST / 11:59 p.m. EST. To access the
replay, dial (877) 870-5176 and use passcode 408474. International
callers should dial (858) 384-5517 and enter the same conference ID
number.
Use of Non-GAAP Information
The Company calculates funds from operations before non-controlling
interest (FFO) in accordance with the standards established by the
National Association of Real Estate Investment Trusts (NAREIT). FFO
represents net income (loss), computed in accordance with accounting
principles generally accepted in the United States of America (GAAP),
excluding gains (or losses) from sales of depreciable operating
property, real estate depreciation and amortization (excluding
amortization of above/below market lease intangible assets and
liabilities and amortization of deferred financing costs and debt
discounts/premium) and after adjustments for unconsolidated partnerships
and joint ventures. The Company uses FFO as a supplemental performance
measure because, in excluding real estate depreciation and amortization
and gains and losses from property dispositions, it provides a
performance measure that, when compared year over year, captures trends
in occupancy rates, rental rates and operating costs. The Company also
believes that, as a widely recognized measure of the performance of
REITs, FFO will be used by investors as a basis to compare its operating
performance with that of other REITs. However, because FFO excludes
depreciation and amortization and captures neither the changes in the
value of our properties that results from use or market conditions nor
the level of capital expenditures and leasing commissions necessary to
maintain the operating performance of its properties, all of which have
real economic effect and could materially impact the Company’s results
from operations, the utility of FFO as a measure of our performance is
limited. Other equity REITs may not calculate FFO in accordance with the
NAREIT definition and, accordingly, the Company’s FFO may not be
comparable to such other REITs’ FFO. Accordingly, FFO should be
considered only as a supplement to net income as a measure of the
Company’s performance. FFO should not be used as a measure of the
Company’s liquidity, nor is it indicative of funds available to fund the
Company’s cash needs, including the Company’s ability to pay dividends.
FFO should not be used as a supplement to or substitute for cash flow
from operating activities computed in accordance with GAAP.
About Hudson Pacific Properties
Hudson Pacific Properties, Inc. is a full-service, vertically integrated
real estate company focused on owning, operating and acquiring
high-quality office properties and state-of-the-art media and
entertainment properties in select growth markets primarily in Northern
and Southern California. The Company’s strategic investment program
targets high barrier-to-entry, in-fill locations with favorable,
long-term supply-demand characteristics in select target markets,
including Los Angeles, Orange County, San Diego and San Francisco. The
Company’s portfolio currently consists of approximately 5.5 million
square feet, not including undeveloped land that the Company believes
can support an additional 2.0 million square feet. The Company has
elected to be taxed as a real estate investment trust, or REIT, for
federal income tax purposes. Hudson Pacific Properties is a component of
the Russell 2000® and the Russell 3000® indices. For additional
information, please visit www.hudsonpacificproperties.com.
Forward-Looking Statements
This press release may contain forward-looking statements within the
meaning of the federal securities laws. Forward-looking statements
relate to expectations, beliefs, projections, future plans and
strategies, anticipated events or trends and similar expressions
concerning matters that are not historical facts. In some cases, you can
identify forward-looking statements by the use of forward-looking
terminology such as “may,” “will,” “should,” “expects,” “intends,”
“plans,” “anticipates,” “believes,” “estimates,” “predicts,” or
“potential” or the negative of these words and phrases or similar words
or phrases that are predictions of or indicate future events or trends
and that do not relate solely to historical matters. Forward-looking
statements involve known and unknown risks, uncertainties, assumptions
and contingencies, many of which are beyond the Company’s control, that
may cause actual results to differ significantly from those expressed in
any forward-looking statement. All forward-looking statements reflect
the Company’s good faith beliefs, assumptions and expectations, but they
are not guarantees of future performance. Furthermore, the Company
disclaims any obligation to publicly update or revise any
forward-looking statement to reflect changes in underlying assumptions
or factors, of new information, data or methods, future events or other
changes. For a further discussion of these and other factors that could
cause the Company’s future results to differ materially from any
forward-looking statements, see the section entitled “Risk Factors” in
the Company’s Annual Report on Form 10-K for the year ended December 31,
2011 filed with the Securities and Exchange Commission on March 14,
2012, and other risks described in documents subsequently filed by the
Company from time to time with the Securities and Exchange Commission.
|
|
|
Hudson Pacific Properties, Inc.
|
|
Consolidated Balance Sheets
|
|
(In thousands, except share data)
|
|
|
|
December 31, 2012
|
|
|
December 31, 2011
|
|
ASSETS
|
|
(Unaudited)
|
|
|
Audited
|
|
REAL ESTATE ASSETS
|
|
|
|
|
|
|
Land
|
|
$
|
493,211
|
|
|
|
$
|
368,608
|
|
|
Building and improvements
|
|
867,268
|
|
|
|
601,812
|
|
|
Tenant improvements
|
|
79,966
|
|
|
|
69,021
|
|
|
Furniture and fixtures
|
|
11,548
|
|
|
|
11,536
|
|
|
Property under development
|
|
23,962
|
|
|
|
9,527
|
|
|
Total real estate held for investment
|
|
1,475,955
|
|
|
|
1,060,504
|
|
|
Accumulated depreciation and amortization
|
|
(85,184
|
)
|
|
|
(53,329
|
)
|
|
Investment in real estate, net
|
|
1,390,771
|
|
|
|
1,007,175
|
|
|
Cash and cash equivalents
|
|
18,904
|
|
|
|
13,705
|
|
|
Restricted cash
|
|
14,322
|
|
|
|
9,521
|
|
|
Accounts receivable, net
|
|
12,442
|
|
|
|
8,963
|
|
|
Notes receivable
|
|
4,000
|
|
|
|
—
|
|
|
Straight-line rent receivables
|
|
14,165
|
|
|
|
10,801
|
|
|
Deferred leasing costs and lease intangibles, net
|
|
83,498
|
|
|
|
84,131
|
|
|
Deferred finance costs, net
|
|
8,175
|
|
|
|
5,079
|
|
|
Interest rate contracts
|
|
71
|
|
|
|
164
|
|
|
Goodwill
|
|
8,754
|
|
|
|
8,754
|
|
|
Prepaid expenses and other assets
|
|
4,588
|
|
|
|
4,498
|
|
|
TOTAL ASSETS
|
|
$
|
1,559,690
|
|
|
|
$
|
1,152,791
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
Notes payable
|
|
$
|
582,085
|
|
|
|
$
|
399,871
|
|
|
Accounts payable and accrued liabilities
|
|
18,833
|
|
|
|
12,469
|
|
|
Below-market leases
|
|
31,560
|
|
|
|
22,861
|
|
|
Security deposits
|
|
6,234
|
|
|
|
5,651
|
|
|
Prepaid rent
|
|
11,281
|
|
|
|
10,795
|
|
|
TOTAL LIABILITIES
|
|
649,993
|
|
|
|
451,647
|
|
|
|
|
|
|
|
|
|
6.25% series A cumulative redeemable preferred units of the
Operating Partnership
|
|
12,475
|
|
|
|
12,475
|
|
|
|
|
|
|
|
|
|
EQUITY
|
|
|
|
|
|
|
Hudson Pacific Properties, Inc. stockholders’ equity:
|
|
|
|
|
|
|
Preferred stock, $0.01 par value, 10,000,000 authorized; 8.375%
series B cumulative redeemable preferred stock, $25.00 liquidation
preference, 5,800,000 shares and 3,500,000 shares outstanding at
December 31, 2012 and 2011, respectively
|
|
145,000
|
|
|
|
87,500
|
|
|
Common Stock, $0.01 par value, 490,000,000 authorized, 47,496,732
shares and 33,840,854 shares outstanding at December 31, 2012 and
2011, respectively
|
|
475
|
|
|
|
338
|
|
|
Additional paid-in capital
|
|
726,605
|
|
|
|
552,043
|
|
|
Accumulated other comprehensive loss
|
|
(1,287
|
)
|
|
|
(883
|
)
|
|
Accumulated deficit
|
|
(30,580
|
)
|
|
|
(13,685
|
)
|
|
Total Hudson Pacific Properties, Inc. stockholders’ equity
|
|
840,213
|
|
|
|
625,313
|
|
|
Non-controlling interest - members in Consolidated Entities
|
|
1,460
|
|
|
|
—
|
|
|
Non-controlling common units in the Operating Partnership
|
|
55,549
|
|
|
|
63,356
|
|
|
TOTAL EQUITY
|
|
897,222
|
|
|
|
688,669
|
|
|
TOTAL LIABILITIES AND EQUITY
|
|
$
|
1,559,690
|
|
|
|
$
|
1,152,791
|
|
|
|
|
Hudson Pacific Properties, Inc.
|
|
Combined Statements of Operations
|
|
(Unaudited, in thousands, except share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended December 31,
|
|
|
|
|
Twelve Months Ended December 31,
|
|
|
|
|
|
|
|
2012
|
|
2011
|
|
|
|
2012
|
|
2011
|
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
Office
|
|
|
|
|
|
|
|
|
|
|
|
Rental
|
|
$
|
25,423
|
|
|
$
|
21,058
|
|
|
|
$
|
93,945
|
|
|
$
|
75,343
|
|
|
Tenant recoveries
|
|
6,215
|
|
|
5,979
|
|
|
|
22,157
|
|
|
22,102
|
|
|
Parking and other
|
|
2,818
|
|
|
1,766
|
|
|
|
9,921
|
|
|
7,763
|
|
|
Total office revenues
|
|
34,456
|
|
|
28,803
|
|
|
|
126,023
|
|
|
105,208
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Media & entertainment
|
|
|
|
|
|
|
|
|
|
|
|
Rental
|
|
6,267
|
|
|
5,357
|
|
|
|
23,598
|
|
|
21,617
|
|
|
Tenant recoveries
|
|
527
|
|
|
278
|
|
|
|
1,598
|
|
|
1,539
|
|
|
Other property-related revenue
|
|
3,936
|
|
|
2,546
|
|
|
|
14,733
|
|
|
13,638
|
|
|
Other
|
|
58
|
|
|
76
|
|
|
|
204
|
|
|
187
|
|
|
Total media & entertainment revenues
|
|
10,788
|
|
|
8,257
|
|
|
|
40,133
|
|
|
36,981
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues
|
|
45,244
|
|
|
37,060
|
|
|
|
166,156
|
|
|
142,189
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses
|
|
|
|
|
|
|
|
|
|
|
|
Office operating expenses
|
|
15,401
|
|
|
12,147
|
|
|
|
53,577
|
|
|
44,740
|
|
|
Media & entertainment operating expenses
|
|
6,347
|
|
|
5,373
|
|
|
|
24,340
|
|
|
22,446
|
|
|
General and administrative
|
|
3,675
|
|
|
3,986
|
|
|
|
16,497
|
|
|
13,038
|
|
|
Depreciation and amortization
|
|
17,602
|
|
|
11,637
|
|
|
|
57,024
|
|
|
44,660
|
|
|
Total operating expenses
|
|
43,025
|
|
|
33,143
|
|
|
|
151,438
|
|
|
124,884
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from operations
|
|
2,219
|
|
|
3,917
|
|
|
|
14,718
|
|
|
17,305
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other expense (income)
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense
|
|
5,094
|
|
|
4,235
|
|
|
|
19,071
|
|
|
17,480
|
|
|
Interest income
|
|
(157
|
)
|
|
(6
|
)
|
|
|
(306
|
)
|
|
(73
|
)
|
|
Acquisition-related expenses
|
|
236
|
|
|
932
|
|
|
|
1,051
|
|
|
1,693
|
|
|
Other expenses (income)
|
|
17
|
|
|
74
|
|
|
|
(92
|
)
|
|
443
|
|
|
|
|
5,190
|
|
|
5,235
|
|
|
|
19,724
|
|
|
19,543
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(2,971
|
)
|
|
$
|
(1,318
|
)
|
|
|
$
|
(5,006
|
)
|
|
$
|
(2,238
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Net income attributable to preferred stock and units
|
|
(3,231
|
)
|
|
(2,027
|
)
|
|
|
(12,924
|
)
|
|
(8,108
|
)
|
|
Less: Net income attributable to restricted shares
|
|
(69
|
)
|
|
(54
|
)
|
|
|
(295
|
)
|
|
(231
|
)
|
|
Less: Net loss (income) attributable to non-controlling interest in
consolidated real estate entities
|
|
21
|
|
|
—
|
|
|
|
21
|
|
|
(803
|
)
|
|
Add: Net loss attributable to common units in the Operating
Partnership
|
|
310
|
|
|
248
|
|
|
|
1,014
|
|
|
946
|
|
|
Net loss attributable to Hudson Pacific Properties, Inc. common
shareholders
|
|
$
|
(5,940
|
)
|
|
$
|
(3,151
|
)
|
|
|
$
|
(17,190
|
)
|
|
$
|
(10,434
|
)
|
|
Net loss attributable to common shareholders’ per share — basic and
diluted
|
|
$
|
(0.13
|
)
|
|
$
|
(0.10
|
)
|
|
|
$
|
(0.41
|
)
|
|
$
|
(0.35
|
)
|
|
Weighted average shares of common stock outstanding — basic and
diluted
|
|
46,690,196
|
|
|
33,150,491
|
|
|
|
41,640,691
|
|
|
29,392,920
|
|
|
Dividends declared per common share
|
|
$
|
0.125
|
|
|
$
|
0.125
|
|
|
|
$
|
0.500
|
|
|
$
|
0.500
|
|
|
|
|
Hudson Pacific Properties, Inc.
|
|
Funds From Operations
|
|
(Unaudited, in thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended December 31,
|
|
|
Twelve Months Ended December 31,
|
|
|
|
2012
|
|
|
2011
|
|
|
2012
|
|
|
2011
|
|
Reconciliation of net loss to Funds From Operations (FFO):
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income
|
|
$
|
(2,971
|
)
|
|
|
$
|
(1,318
|
)
|
|
|
$
|
(5,006
|
)
|
|
|
$
|
(2,238
|
)
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization of real estate assets
|
|
17,602
|
|
|
|
11,637
|
|
|
|
57,024
|
|
|
|
44,660
|
|
|
Less: Net income attributable to non-controlling interest in
consolidated real estate entities
|
|
(17
|
)
|
|
|
—
|
|
|
|
(17
|
)
|
|
|
(803
|
)
|
|
Less: Net income attributable to preferred stock and units
|
|
(3,231
|
)
|
|
|
(2,027
|
)
|
|
|
(12,924
|
)
|
|
|
(8,108
|
)
|
|
FFO to common shareholders and unit holders
|
|
$
|
11,383
|
|
|
|
$
|
8,292
|
|
|
|
$
|
39,077
|
|
|
|
$
|
33,511
|
|
|
Specified items impacting FFO:
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition-related expenses
|
|
236
|
|
|
|
932
|
|
|
|
1,051
|
|
|
|
1,693
|
|
|
One-time property tax expenses
|
|
—
|
|
|
|
—
|
|
|
|
918
|
|
|
|
—
|
|
|
FFO (excluding specified items) to common shareholders and unit
holders
|
|
$
|
11,619
|
|
|
|
$
|
9,224
|
|
|
|
$
|
41,046
|
|
|
|
$
|
35,204
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common shares/units outstanding - diluted
|
|
49,679
|
|
|
|
36,196
|
|
|
|
44,693
|
|
|
|
32,466
|
|
|
FFO per common share/unit — diluted
|
|
$
|
0.23
|
|
|
|
$
|
0.23
|
|
|
|
$
|
0.87
|
|
|
|
$
|
1.03
|
|
|
FFO (excluding specified items) per common share/unit — diluted
|
|
$
|
0.23
|
|
|
|
$
|
0.25
|
|
|
|
$
|
0.92
|
|
|
|
$
|
1.08
|
|
Investor Contact:
Hudson Pacific Properties, Inc.
Mark
Lammas
Chief Financial Officer
(310) 445-5700
or
Investor
/ Media Contact:
Addo Communications, Inc.
Lasse
Glassen
(310) 829-5400
lasseg@addocommunications.com
Source: Hudson Pacific Properties, Inc.