Hudson Pacific Properties (HPP) Q1 2025 earnings summary

Executive summary

• Achieved 630,000 sq ft of new and renewal leases in Q1 2025, including a 232,000 sq ft, 20-year lease with the City and County of San Francisco, marking the best office leasing quarter in nearly three years and a robust pipeline of 2.1 million sq ft with over 700,000 sq ft in later-stage deals.

• Office and studio leasing pipelines remain robust, with increased tour activity and significant late-stage deals; office fundamentals improved with reduced sublease availability and limited new supply.

• Non-strategic asset sales generated $97 million in liquidity, with further dispositions of $125–$150 million targeted, and proceeds used to repay debt.

• Cost-cutting initiatives, especially at Quixote, have reduced annualized expenses by $14 million.

• 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 ($0.53/share), up from $52.2 million ($0.37/share) a year ago, 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; AFFO was $1.7 million ($0.01/share) vs. $28.5 million ($0.19/share) year-over-year.

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

• Net operating income (NOI) decreased 18% year-over-year to $85.2 million.

Outlook and guidance

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

• Full-year guidance anticipates a 12.5–13.5% drop in same-store cash NOI and incorporates recent asset sales and debt repayments.

• Occupancy expected to stabilize and grow from Q3 2025 onward as expirations taper; fundamentals are improving or stabilizing, with no tariff-related impacts to tenant demand observed.

• Studio segment expected to benefit from potential government support and increased production activity.

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