UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 08, 2024
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||||||||||||
(Address of principal executive offices)
Registrant’s telephone number, including area code: (281) 719-6100
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class: | Trading Symbol(s) | Name of each exchange on which registered: | |||||||||||||||
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition
On May 8, 2024, Howard Hughes Holdings Inc. (the “Company”) issued a press release announcing the Company’s financial results for the first quarter ended March 31, 2024. A copy of this press release is attached hereto as Exhibit 99.1.
The information contained in this Current Report on Form 8-K pursuant to this “Item 2.02 Results of Operations and Financial Condition” is being furnished. This information shall not be deemed to be filed for the purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section or shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, unless specifically identified therein as being incorporated by reference.
Item 7.01 Regulation FD Disclosure.
On May 8, 2024, the Company issued supplemental information for the first quarter ended March 31, 2024. The supplemental information contains key information about the Company. The supplemental information is attached hereto as Exhibit 99.2 and has been posted on our website at www.howardhughes.com under the “Investors” tab.
The information contained in this Current Report on Form 8-K pursuant to this “Item 7.01 Regulation FD Disclosure” is being furnished. This information shall not be deemed to be filed for the purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section or shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, unless specifically identified therein as being incorporated by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
| Exhibit No. | Description | |||||||
| 99.1 | ||||||||
| 99.2 | ||||||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | |||||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| HOWARD HUGHES HOLDINGS INC. | |||||||||||
| By: | /s/ David O'Reilly | ||||||||||
| David O'Reilly | |||||||||||
| Chief Executive Officer | |||||||||||
Date: May 8, 2024
Exhibit 99.1
HOWARD HUGHES HOLDINGS INC. REPORTS FIRST QUARTER 2024 RESULTS
Strong momentum continues into the first quarter, reaffirming expectations for a robust 2024
THE WOODLANDS, Texas, May 8, 2024 – Howard Hughes Holdings Inc. (NYSE: HHH) (the “Company,” “HHH,” or “we”) today announced operating results for the first quarter ended March 31, 2024. The financial statements, exhibits, and reconciliations of non-GAAP measures in the attached Appendix and the Supplemental Information at Exhibit 99.2 provide further detail of these results.
First Quarter 2024 Highlights:
–Net loss per diluted share of $(1.06) compared to $(0.46) in the prior-year period primarily related to reduced commercial land sales, lower equity earnings from The Summit, and increased G&A expenses associated with the anticipated spinoff of Seaport Entertainment
–Full-year 2024 guidance is unchanged with segment mid-point projections for MPC EBT of $300 million, Operating Asset NOI of $250 million, and condo sales of $700 million with gross margins of 29%
–Total Operating Assets NOI of $63 million increased 7% year-over-year with improved performance in office and multi-family
–New home sales in HHH’s communities increased to 654 units—a 24% sequential increase compared to the 2023 fourth quarter—signifying strong demand for residential land sales in the coming quarters
–The first 52 acres of residential land were sold in Floreo—the first village in TeravalisTM—at a strong $758,000 per acre
–Contracted to sell 196 condo units in Ward Village®, including 182 residences at The Launiu—achieving a new milestone of $6 billion in total condo sales since the community’s inception
–Launched pre-sales at The Ritz-Carlton Residences, The Woodlands—our first condominium development in Texas and the first-of-its-kind in the market—pre-selling more than 50% of available inventory for approximately $250 million in future revenue in just one week
“In the first quarter, we continued to see strong momentum across our core businesses, starting the year on a positive note and reaffirming our expectations for another incredible year at Howard Hughes,” commented David R. O’Reilly, Chief Executive Officer of Howard Hughes. “So far in 2024, we have experienced a meaningful acceleration in the pace of new home sales—a leading indicator for future land sales—and exceptional demand for our newest premier condominium developments. In our Operating Assets segment, we delivered strong 7% year-over-year net operating income growth—most notably from enhanced performance from our office and multi-family portfolios—providing a solid start to what we expect will be a record year for this segment.
“In our MPCs, new home sales climbed to 654 homes—the highest quarterly total across HHH’s communities in three years—as limited availability of resale homes continued to drive homebuyers to new construction. Although residential land sales were muted in the first quarter—primarily due to the timing of contracted super pad sales in Summerlin which are expected to close in the second and third quarters—we continue to see low inventories of vacant developed lots within our markets. As a result, homebuilder interest in additional acreage remains at elevated levels, and we anticipate robust residential land sales during the coming quarters with strong MPC EBT of approximately $300 million for the full year.
“In Arizona, we achieved a significant milestone with the closings of our first residential land sales to homebuilders in our Floreo joint venture at Teravalis. In total, 365 lots representing 52 acres were sold for $758,000 per acre, an impressive price which exceeded our expectations. More lot closings are anticipated in the second quarter, and we expect a grand opening for Floreo in 2025.
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“We also experienced exceptional demand for our latest condominium projects, with more than 250 residences representing nearly $560 million of future revenue pre-sold in the first quarter. In Hawai‘i, we launched pre-sales at The Launiu—Ward Village’s 11th tower—and in just six weeks we contracted nearly 40% of its units. Ward Village continues to outperform expectations, reaching $6 billion in total sales, including the community’s six delivered towers that are 100% sold and those towers currently under construction or in pre-sales. In Texas, we also launched pre-sales at the Ritz-Carlton Residences, The Woodlands—our first condominium project on the U.S. Mainland. This first-of-its-kind luxury condo development for The Woodlands market set a new HHH sales record at prices well above our expectations, pre-selling more than 50% of available units and totaling approximately $250 million of contracted revenue in its first week of sales. With this outstanding pace of sales, we look forward to commencing construction on this project later in 2024.
“Finally, we have made significant progress with our anticipated spinoff of Seaport Entertainment, and we expect to finalize the transaction in the coming months. As this date draws closer, we are excited about the future potential of these unique entertainment-related assets under the dedicated leadership of Anton Nikodemus—CEO of Seaport Entertainment—and his experienced management team. For Howard Hughes, operating as a pure-play real estate company will have tremendous advantages as we focus strategically on what we do best—developing world-class master planned communities. With nearly 35,000 acres remaining in our unmatched landbank and a robust pipeline of future development opportunities, we see considerable growth and value creation for our shareholders in the years ahead.”
Financial Highlights
Total Company
–HHH reported a loss of $52.5 million, or $(1.06) per diluted share in the quarter, compared to $22.7 million or $(0.46) per diluted share in the prior-year period.
–The year-over-year decline was primarily related to reduced MPC commercial land sales, lower equity earnings from The Summit, and increased G&A expenses associated with the anticipated spinoff of Seaport Entertainment.
–The Company continues to maintain a strong liquidity position with $462.7 million of cash and cash equivalents, $1.0 billion of undrawn lender commitment available to be drawn for property development and limited near-term debt maturities.
Operating Assets
–Total Operating Assets NOI, including the contribution from unconsolidated ventures, totaled $63.5 million in the quarter, representing a $4.3 million or 7% improvement compared to $59.2 million in the prior-year period.
–Office NOI of $30.6 million increased $2.8 million, or 10% year-over-year largely due to strong leasing activity and abatement expirations at various properties in The Woodlands® and Summerlin®—most notably at 9950 Woodloch Forest and 1700 Pavilion. During the quarter, HHH executed new or expanded office leases totaling 86,000 square feet, primarily in The Woodlands and Downtown Columbia®, and the office portfolio was 88% leased.
–Multi-family NOI of $13.8 million increased $1.1 million, or 9% compared to the first quarter of 2023 due to strong lease-up at Starling at Bridgeland and Marlow in Downtown Columbia, as well as 4% average in-place rent growth. These gains were partially offset by non-recurring winter-weather-related insurance recoveries in the Houston region during the first quarter of 2023. At quarter end, the stabilized multi-family portfolio was 95% leased.
–Final construction and leasing momentum at Wingspan—our new 263-unit single-family build-to-rent community in Bridgeland—has been strong since its initial opening in late 2023. As of quarter-end, 63% of its units were complete with 28% of all units leased. Wingspan is expected to be fully completed in the second quarter.
–In February, the Company sold the Creekside Park Medical Plaza Office Building in The Woodlands for $14.0 million, resulting in a gain on sale of $4.8 million.
MPC
–MPC EBT, which totaled $24.3 million in the first quarter, declined 61% compared to $62.4 million in the prior-year period. Land sales, which can be lumpy and vary from quarter to quarter, are expected to materially increase during the remainder of 2024, resulting in a strong EBT outlook of $300 million at the mid-point for the full year.
–Commercial land sales declined $22.5 million due to a non-recurring 109-acre sale in Bridgeland® during the prior year.
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–Residential land sales declined $4.4 million year-over-year, primarily due to a $10.1 million reduction in custom lot sales at Aria Isle in The Woodlands—a premier gated community with only one lot remaining to sell. This reduction was partially offset by a $6.2 million increase in land sales in Bridgeland.
–The average price per acre of residential land sold was approximately $600,000 during the first quarter, representing a 28% year-over-year reduction—primarily due to the significant contribution of custom lot sales for $2.9 million per acre in The Woodlands and Summerlin in the prior year. Excluding these custom lot sales, the average price per acre increased 15% year-over-year.
–In Arizona, 52 acres of residential land in Floreo—the first village in Teravalis—were sold at an average price per acre of $758,000. These sales contributed to $1.2 million of MPC equity earnings for HHH in the first quarter.
–New homes sold in HHH’s communities totaled 654 units—representing a 24% increase compared to the fourth quarter of 2023 and an 18% increase compared to the prior-year quarter.
–MPC equity earnings were a loss of $14.7 million—representing a $18.8 million year-over-year reduction—primarily related to The Summit, partially offset by the increased contribution from Floreo.
Strategic Developments
–Pre-sales at The Launiu—Ward Village’s 11th condo building—were launched in February. At quarter end, 182 units were contracted, representing 38% of the tower’s 485 residences and future revenue of $299.0 million.
–Contracted to sell 14 units at The Park Ward Village® and Kalae®. At quarter end, The Park Ward Village and Kalae were 95% and 90% pre-sold, respectively. Construction on Kalae is expected to commence in the second quarter.
–Pre-sales at The Ritz Carlton Residences, The Woodlands—a new 111-unit luxury condominium development on the shores of Lake Woodlands—commenced in late March. At quarter end, 56 units, or 50% of available residences, were pre-sold at prices that exceeded expectations.
–Commenced construction on Village Green at Bridgeland Central, a 28,000-square foot retail development in Bridgeland which will be anchored by an H-E-B grocery store and include in-line retail and restaurants.
–HHH incurred a $3.0 million charge during the quarter to fund the final remediation expenditures related to window construction defects at Waiea® in Ward Village. The Company continues to vigorously pursue recovery of all Waiea window remediation costs from the general contractor and other responsible parties.
Seaport
–Seaport revenue of $11.5 million declined $0.4 million, or 3% compared to the first quarter of 2023, primarily due to reduced restaurant revenue at Pier 17 related to poor weather in the current year, as well as lower sponsorship revenue. This was partially offset by improved rental revenue from the Fulton Market Building, which is now 100% occupied.
–Seaport generated negative NOI of $8.6 million, representing a $3.0 million year-over-year reduction, primarily due to sales mix and increased costs associated with the stand-up of Seaport Entertainment in anticipation of the spinoff later this year. Total Seaport NOI, including $8.9 million of losses from unconsolidated ventures—primarily related to the Tin Building by Jean-Georges—was a loss of $17.5 million.
–At the Tin Building by Jean-Georges, equity losses were $8.7 million, or a $0.4 million year-over-year and $3.2 million sequential improvement. The improvements were primarily driven by enhanced efficiencies and changes to the venue’s operating platform which have been implemented by Jean-Georges, in partnership with Seaport Entertainment’s new management team.
Full Year 2024 Guidance
–Full-year 2024 guidance remains unchanged from the prior reporting period.
–MPC EBT is projected to be robust during 2024, aided by stable mortgage rates and tight supply of existing homes on the market. New home sales in Summerlin, Bridgeland, and The Woodlands Hills® are expected to be strong, leading to continued homebuilder demand for residential land. The first land sales in Floreo—the first village in Teravalis—are also expected to contribute incremental equity earnings in 2024. These year-over-year gains are expected to be more than offset by reduced EBT associated with exceptional commercial land sales and builder price participation during 2023, as well as by reduced inventory of custom lots available to sell at Aria Isle in The Woodlands and the Summit in Summerlin. As a result, 2024 MPC EBT is expected to modestly decline 10% to 15% year-over-year with a mid-point of approximately $300 million.
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–Operating Assets NOI, including the contribution from unconsolidated ventures, is projected to benefit from increased occupancy at new multi-family developments in Downtown Columbia, Summerlin, and Bridgeland, as well as improved retail leasing and new tenants in Downtown Columbia, Ward Village, and The Woodlands. The office portfolio is expected to benefit from strong leasing momentum experienced since mid-2023, but free rent periods on many of the new leases and the impact of some tenant vacancies and new office developments expected to be completed in 2024 will likely result in office NOI being relatively flat year-over-year. Overall, 2024 Operating Assets NOI is expected to be in a range of up 1% to 4% year-over-year with a mid-point of approximately $250 million. This includes approximately $5.0 million of projected NOI from the Las Vegas Aviators® and the Las Vegas Ballpark®, which are expected to be included in the spinoff of Seaport Entertainment.
–Condo sales revenues are projected to range between $675 million and $725 million, with gross margins between 28% to 30%. Projected condo sales revenues will be driven by the closing of units at Victoria Place®—a 349-unit upscale development in Ward Village which is 100% pre-sold and expected to be completed late in the fourth quarter of 2024. This guidance contemplates approximately $75 million of condo sales revenues for Victoria Place occurring in the first quarter of 2025 due to the timing of condo closings.
–Cash G&A is projected to range between $80 million and $90 million, excluding approximately $25 million of cash expenses associated with the spinoff of Seaport Entertainment and $5 million of anticipated non-cash stock compensation.
Conference Call & Webcast Information
Howard Hughes Holdings Inc. will host its first quarter 2024 earnings conference call on Thursday, May 9, 2024, at 10:00 a.m. Eastern Time (9:00 a.m. Central Time). Please visit the Howard Hughes website to listen to the earnings call via a live webcast. For listeners who wish to participate in the question-and-answer session via telephone, please preregister using HHH’s earnings call registration website. All registrants will receive dial-in information and a PIN allowing them to access the live call. An on-demand replay of the earnings call will be available on the Company’s website.
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We are primarily focused on creating shareholder value by increasing our per-share net asset value. Often, the nature of our business results in short-term volatility in our net income due to the timing of MPC land sales, recognition of condominium revenue and operating business pre-opening expenses, and, as such, we believe the following metrics summarized below are most useful in tracking our progress towards net asset value creation.
| Three Months Ended March 31, | ||||||||||||||||||||
| $ in thousands | 2024 | 2023 | $ Change | % Change | ||||||||||||||||
Operating Assets NOI (1) | ||||||||||||||||||||
| Office | $ | 30,598 | $ | 27,785 | $ | 2,813 | 10 | % | ||||||||||||
| Retail | 14,567 | 14,618 | (51) | — | % | |||||||||||||||
| Multi-family | 13,777 | 12,633 | 1,144 | 9 | % | |||||||||||||||
| Other | (623) | (823) | 200 | 24 | % | |||||||||||||||
| Redevelopments (a) | — | (10) | 10 | 100 | % | |||||||||||||||
| Dispositions (a) | (55) | 107 | (162) | (151) | % | |||||||||||||||
| Operating Assets NOI | 58,264 | 54,310 | 3,954 | 7 | % | |||||||||||||||
| Company's share of NOI from unconsolidated ventures | 5,222 | 4,860 | 362 | 7 | % | |||||||||||||||
| Total Operating Assets NOI | $ | 63,486 | $ | 59,170 | $ | 4,316 | 7 | % | ||||||||||||
| Projected stabilized NOI Operating Assets ($ in millions) | $ | 357.8 | $ | 363.5 | $ | (5.7) | (2) | % | ||||||||||||
| MPC | ||||||||||||||||||||
| Acres Sold - Residential | 31 | 32 | (1) | (2) | % | |||||||||||||||
| Acres Sold - Commercial | 4 | 109 | (105) | (97) | % | |||||||||||||||
| Price Per Acre - Residential | 600 | 836 | (236) | (28) | % | |||||||||||||||
| Price Per Acre - Commercial | 801 | 247 | 554 | NM | ||||||||||||||||
| MPC EBT | $ | 24,251 | $ | 62,372 | $ | (38,121) | (61) | % | ||||||||||||
Seaport NOI (1) | ||||||||||||||||||||
| Landlord Operations | $ | (4,853) | $ | (4,290) | $ | (563) | (13) | % | ||||||||||||
| Landlord Operations - Multi-family | 58 | 28 | 30 | 107 | % | |||||||||||||||
| Managed Businesses | (3,142) | (2,536) | (606) | (24) | % | |||||||||||||||
| Tin Building | 2,258 | 2,415 | (157) | (7) | % | |||||||||||||||
| Events and Sponsorships | (2,926) | (1,202) | (1,724) | (143) | % | |||||||||||||||
| Seaport NOI | (8,605) | (5,585) | (3,020) | (54) | % | |||||||||||||||
| Company's share of NOI from unconsolidated ventures | (8,902) | (9,591) | 689 | 7 | % | |||||||||||||||
| Total Seaport NOI | $ | (17,507) | $ | (15,176) | $ | (2,331) | (15) | % | ||||||||||||
| Strategic Developments | ||||||||||||||||||||
| Condominium rights and unit sales | $ | 23 | $ | 6,087 | $ | (6,064) | (100) | % | ||||||||||||
(a)Properties that were transferred to our Strategic Developments segment for redevelopment and properties that were sold are shown separately for all periods presented.
NM - Not Meaningful
Financial Data
(1)See the accompanying appendix for a reconciliation of GAAP to non-GAAP financial measures and a statement indicating why management believes the non-GAAP financial measure provides useful information for investors.
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About Howard Hughes Holdings Inc.®
Howard Hughes Holdings Inc. owns, manages, and develops commercial, residential, and mixed-use real estate throughout the U.S. Its award-winning assets include the country's preeminent portfolio of master planned communities, as well as operating properties and development opportunities including: the Seaport in New York City; Downtown Columbia® in Maryland; The Woodlands®, Bridgeland® and The Woodlands Hills® in the Greater Houston, Texas area; Summerlin® in Las Vegas; Ward Village® in Honolulu, Hawaiʻi; and Teravalis™ in the Greater Phoenix, Arizona area. The Howard Hughes portfolio is strategically positioned to meet and accelerate development based on market demand, resulting in one of the strongest real estate platforms in the country. Dedicated to innovative placemaking, the company is recognized for its ongoing commitment to design excellence and to the cultural life of its communities. Howard Hughes Holdings Inc. is traded on the New York Stock Exchange as HHH. For additional information visit www.howardhughes.com.
Safe Harbor Statement
Certain statements contained in this press release may constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. All statements other than statements of historical facts, including, among others, statements regarding the Company’s future financial position, results or performance, are forward-looking statements. Those statements include statements regarding the intent, belief, or current expectations of the Company, members of its management team, as well as the assumptions on which such statements are based, and generally are identified by the use of words such as “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “intend,” “likely,” “may,” “plan,” “project,” “realize,” “should,” “transform,” “will,” “would,” and other statements of similar expression. Forward-looking statements are not a guaranty of future performance and involve risks and uncertainties that actual results may differ materially from those contemplated by such forward-looking statements. Many of these factors are beyond the Company’s abilities to control or predict. Some of the risks, uncertainties and other important factors that may affect future results or cause actual results to differ materially from those expressed or implied by forward-looking statements include: (i) general adverse economic and local real estate conditions; (ii) potential changes in the financial markets and interest rates; (iii) the inability of major tenants to continue paying their rent obligations due to bankruptcy, insolvency or a general downturn in their business; (iv) financing risks, such as the inability to obtain equity, debt or other sources of financing or refinancing on favorable terms, if at all; (v) ability to compete effectively, including the potential impact of heightened competition for tenants and potential decreases in occupancy at our properties; (vi) our ability to satisfy the necessary conditions and complete the spinoff on a timely basis (or at all) and realize the anticipated benefits of the spinoff; (vii) our ability to successfully identify, acquire, develop and/or manage properties on favorable terms and in accordance with applicable zoning and permitting laws; (xiii) changes in governmental laws and regulations; (ix) general inflation, including core and wage inflation; commodity and energy price and currency volatility; as well as monetary, fiscal, and policy interventions in anticipation of our reaction to such events; (x) the impact of the COVID-19 pandemic on the Company’s business, tenants and the economy in general, and our ability to accurately assess and predict such impacts; (xi) lack of control over certain of the Company’s properties due to the joint ownership of such property; (xii) impairment charges; (xiii) the effects of catastrophic events or geopolitical conditions, such as international armed conflict, or a resurgence of the COVID-19 pandemic; (xiv) the effects of extreme weather conditions or climate change, including natural disasters; (xv) the inherent risks related to disruption of information technology networks and related systems, including cyber security attacks; and (xvi) the ability to attract and retain key employees. The Company refers you to the section entitled “Risk Factors” contained in the Company's Annual Report on Form 10-K for the year ended December 31, 2023. Additional information concerning factors that could cause actual results to differ materially from those forward-looking statements is contained from time to time in the Company's filings with the Securities and Exchange Commission. Copies of each filing may be obtained from the Company or the Securities and Exchange Commission. The risks included here are not exhaustive and undue reliance should not be placed on any forward-looking statements, which are based on current expectations. All written and oral forward-looking statements attributable to the Company, its management, or persons acting on their behalf are qualified in their entirety by these cautionary statements. Further, forward-looking statements speak only as of the date they are made, and the Company undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time unless otherwise required by law.
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Financial Presentation
As discussed throughout this release, we use certain non-GAAP performance measures, in addition to the required GAAP presentations, as we believe these measures improve the understanding of our operational results and make comparisons of operating results among peer companies more meaningful. We continually evaluate the usefulness, relevance, limitations, and calculation of our reported non-GAAP performance measures to determine how best to provide relevant information to the public, and thus such reported measures could change. A non-GAAP financial measure used throughout this release is net operating income (NOI). We provide a more detailed discussion about this non-GAAP measure in our reconciliation of non-GAAP measures provided in the appendix in this earnings release.
Media Contact
Howard Hughes Holdings Inc.
Cristina Carlson, 646-822-6910
Senior Vice President, Head of Corporate Communications
cristina.carlson@howardhughes.com
Investor Relations Contact
Howard Hughes Holdings Inc.
Eric Holcomb, 281-475-2144
Senior Vice President, Investor Relations
eric.holcomb@howardhughes.com
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HOWARD HUGHES HOLDINGS INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
UNAUDITED
| Three Months Ended March 31, | |||||||||||
| thousands except per share amounts | 2024 | 2023 | |||||||||
| REVENUES | |||||||||||
| Condominium rights and unit sales | $ | 23 | $ | 6,087 | |||||||
| Master Planned Communities land sales | 32,415 | 59,361 | |||||||||
| Rental revenue | 107,751 | 97,864 | |||||||||
| Other land, rental, and property revenues | 18,383 | 18,968 | |||||||||
| Builder price participation | 12,566 | 14,009 | |||||||||
| Total revenues | 171,138 | 196,289 | |||||||||
| EXPENSES | |||||||||||
| Condominium rights and unit cost of sales | 3,861 | 4,536 | |||||||||
| Master Planned Communities cost of sales | 12,904 | 22,003 | |||||||||
| Operating costs | 74,289 | 72,387 | |||||||||
| Rental property real estate taxes | 14,695 | 15,419 | |||||||||
| Provision for (recovery of) doubtful accounts | 834 | (2,420) | |||||||||
| General and administrative | 30,902 | 23,553 | |||||||||
| Depreciation and amortization | 52,247 | 52,009 | |||||||||
| Other | 3,818 | 3,571 | |||||||||
| Total expenses | 193,550 | 191,058 | |||||||||
| OTHER | |||||||||||
| Gain (loss) on sale or disposal of real estate and other assets, net | 4,794 | 4,730 | |||||||||
| Other income (loss), net | 891 | 4,981 | |||||||||
| Total other | 5,685 | 9,711 | |||||||||
| Operating income (loss) | (16,727) | 14,942 | |||||||||
| Interest income | 8,118 | 4,092 | |||||||||
| Interest expense | (41,918) | (38,137) | |||||||||
| Equity in earnings (losses) from unconsolidated ventures | (19,135) | (4,802) | |||||||||
| Income (loss) before income taxes | (69,662) | (23,905) | |||||||||
| Income tax expense (benefit) | (17,195) | (1,278) | |||||||||
| Net income (loss) | (52,467) | (22,627) | |||||||||
| Net (income) loss attributable to noncontrolling interests | (10) | (118) | |||||||||
| Net income (loss) attributable to common stockholders | $ | (52,477) | $ | (22,745) | |||||||
| Basic income (loss) per share | $ | (1.06) | $ | (0.46) | |||||||
| Diluted income (loss) per share | $ | (1.06) | $ | (0.46) | |||||||
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HOWARD HUGHES HOLDINGS INC.
CONSOLIDATED BALANCE SHEETS
UNAUDITED
| thousands except par values and share amounts | March 31, 2024 | December 31, 2023 | |||||||||
| ASSETS | |||||||||||
| Master Planned Communities assets | $ | 2,481,538 | $ | 2,445,673 | |||||||
| Buildings and equipment | 4,207,900 | 4,177,677 | |||||||||
| Less: accumulated depreciation | (1,071,110) | (1,032,226) | |||||||||
| Land | 303,380 | 303,685 | |||||||||
| Developments | 1,438,924 | 1,272,445 | |||||||||
| Net investment in real estate | 7,360,632 | 7,167,254 | |||||||||
| Investments in unconsolidated ventures | 213,433 | 220,258 | |||||||||
| Cash and cash equivalents | 462,700 | 631,548 | |||||||||
| Restricted cash | 429,130 | 421,509 | |||||||||
| Accounts receivable, net | 111,117 | 115,045 | |||||||||
| Municipal Utility District receivables, net | 584,222 | 550,884 | |||||||||
| Deferred expenses, net | 145,833 | 142,561 | |||||||||
| Operating lease right-of-use assets | 45,649 | 44,897 | |||||||||
| Other assets, net | 283,175 | 283,047 | |||||||||
| Total assets | $ | 9,635,891 | $ | 9,577,003 | |||||||
| LIABILITIES | |||||||||||
| Mortgages, notes, and loans payable, net | $ | 5,391,243 | $ | 5,302,620 | |||||||
| Operating lease obligations | 53,065 | 51,584 | |||||||||
| Deferred tax liabilities, net | 70,697 | 87,835 | |||||||||
| Accounts payable and other liabilities | 1,108,131 | 1,076,040 | |||||||||
| Total liabilities | 6,623,136 | 6,518,079 | |||||||||
| EQUITY | |||||||||||
| Preferred stock: $0.01 par value; 50,000,000 shares authorized, none issued | — | — | |||||||||
Common stock: $0.01 par value; 150,000,000 shares authorized, 56,714,750 issued, and 50,243,739 outstanding as of March 31, 2024, 56,495,791 shares issued, and 50,038,014 outstanding as of December 31, 2023 | 567 | 565 | |||||||||
| Additional paid-in capital | 3,993,152 | 3,988,496 | |||||||||
| Retained earnings (accumulated deficit) | (436,173) | (383,696) | |||||||||
| Accumulated other comprehensive income (loss) | 3,897 | 1,272 | |||||||||
Treasury stock, at cost, 6,471,011 shares as of March 31, 2024, and 6,457,777 shares as of December 31, 2023 | (614,818) | (613,766) | |||||||||
| Total stockholders' equity | 2,946,625 | 2,992,871 | |||||||||
| Noncontrolling interests | 66,130 | 66,053 | |||||||||
| Total equity | 3,012,755 | 3,058,924 | |||||||||
| Total liabilities and equity | $ | 9,635,891 | $ | 9,577,003 | |||||||
9
Segment Earnings Before Tax (EBT)
As a result of our four segments—Operating Assets, Master Planned Communities (MPC), Seaport, and Strategic Developments—being managed separately, we use different operating measures to assess operating results and allocate resources among these four segments. The one common operating measure used to assess operating results for our business segments is EBT. EBT, as it relates to each business segment, includes the revenues and expenses of each segment, as shown below. EBT excludes corporate expenses and other items that are not allocable to the segments. We present EBT because we use this measure, among others, internally to assess the core operating performance of our assets.
| Three Months Ended March 31, | |||||||||||||||||
| thousands | 2024 | 2023 | $ Change | ||||||||||||||
| Operating Assets Segment EBT | |||||||||||||||||
| Total revenues | $ | 110,152 | $ | 100,925 | $ | 9,227 | |||||||||||
| Total operating expenses | (51,395) | (47,599) | (3,796) | ||||||||||||||
| Segment operating income (loss) | 58,757 | 53,326 | 5,431 | ||||||||||||||
| Depreciation and amortization | (44,156) | (39,632) | (4,524) | ||||||||||||||
| Interest income (expense), net | (33,476) | (28,911) | (4,565) | ||||||||||||||
| Other income (loss), net | 408 | 2,282 | (1,874) | ||||||||||||||
| Equity in earnings (losses) from unconsolidated ventures | 5,817 | 1,905 | 3,912 | ||||||||||||||
| Gain (loss) on sale or disposal of real estate and other assets, net | 4,794 | 4,730 | 64 | ||||||||||||||
| Operating Assets segment EBT | $ | (7,856) | $ | (6,300) | $ | (1,556) | |||||||||||
| Master Planned Communities Segment EBT | |||||||||||||||||
| Total revenues | $ | 48,875 | $ | 77,013 | $ | (28,138) | |||||||||||
| Total operating expenses | (25,049) | (34,351) | 9,302 | ||||||||||||||
| Segment operating income (loss) | 23,826 | 42,662 | (18,836) | ||||||||||||||
| Depreciation and amortization | (110) | (107) | (3) | ||||||||||||||
| Interest income (expense), net | 15,246 | 15,812 | (566) | ||||||||||||||
| Other income (loss), net | — | (103) | 103 | ||||||||||||||
| Equity in earnings (losses) from unconsolidated ventures | (14,711) | 4,108 | (18,819) | ||||||||||||||
| MPC segment EBT | $ | 24,251 | $ | 62,372 | $ | (38,121) | |||||||||||
Seaport Segment EBT | |||||||||||||||||
| Total revenues | $ | 11,502 | $ | 11,897 | $ | (395) | |||||||||||
| Total operating expenses | (21,485) | (18,916) | (2,569) | ||||||||||||||
| Segment operating income (loss) | (9,983) | (7,019) | (2,964) | ||||||||||||||
| Depreciation and amortization | (5,757) | (10,527) | 4,770 | ||||||||||||||
| Interest income (expense), net | (2,012) | 1,186 | (3,198) | ||||||||||||||
| Other income (loss), net | — | 1 | (1) | ||||||||||||||
| Equity in earnings (losses) from unconsolidated ventures | (10,280) | (10,820) | 540 | ||||||||||||||
| Seaport segment EBT | $ | (28,032) | $ | (27,179) | $ | (853) | |||||||||||
| Strategic Developments Segment EBT | |||||||||||||||||
| Total revenues | $ | 593 | $ | 6,440 | $ | (5,847) | |||||||||||
| Total operating expenses | (8,654) | (11,059) | 2,405 | ||||||||||||||
| Segment operating income (loss) | (8,061) | (4,619) | (3,442) | ||||||||||||||
| Depreciation and amortization | (1,419) | (943) | (476) | ||||||||||||||
| Interest income (expense), net | 4,024 | 2,063 | 1,961 | ||||||||||||||
| Other income (loss), net | 3 | 94 | (91) | ||||||||||||||
| Equity in earnings (losses) from unconsolidated ventures | 39 | 5 | 34 | ||||||||||||||
| Strategic Developments segment EBT | $ | (5,414) | $ | (3,400) | $ | (2,014) | |||||||||||
10
Appendix – Reconciliation of Non-GAAP Measures
Below are GAAP to non-GAAP reconciliations of certain financial measures, as required under Regulation G of the Securities Exchange Act of 1934. Non-GAAP information should be considered by the reader in addition to, but not instead of, the financial statements prepared in accordance with GAAP. The non-GAAP financial information presented may be determined or calculated differently by other companies and may not be comparable to similarly titled measures.
Net Operating Income (NOI)
We define NOI as operating revenues (rental income, tenant recoveries, and other revenue) less operating expenses (real estate taxes, repairs and maintenance, marketing, and other property expenses). NOI excludes straight-line rents and amortization of tenant incentives, net; interest expense, net; ground rent amortization; demolition costs; other income (loss); depreciation and amortization; development-related marketing costs; gain on sale or disposal of real estate and other assets, net; loss on extinguishment of debt; provision for impairment; and equity in earnings from unconsolidated ventures. This amount is presented as Operating Assets NOI and Seaport NOI throughout this document. Total Operating Assets NOI and Total Seaport NOI represent NOI as defined above with the addition of our share of NOI from unconsolidated ventures.
We believe that NOI is a useful supplemental measure of the performance of our Operating Assets and Seaport segments because it provides a performance measure that reflects the revenues and expenses directly associated with owning and operating real estate properties. We use NOI to evaluate our operating performance on a property-by-property basis because NOI allows us to evaluate the impact that property-specific factors such as rental and occupancy rates, tenant mix, and operating costs have on our operating results, gross margins, and investment returns.
A reconciliation of segment EBT to NOI for Operating Assets and Seaport is presented in the tables below:
| Three Months Ended March 31, | |||||||||||||||||
| thousands | 2024 | 2023 | Change | ||||||||||||||
| Operating Assets Segment | |||||||||||||||||
| Total revenues | $ | 110,152 | $ | 100,925 | $ | 9,227 | |||||||||||
| Total operating expenses | (51,395) | (47,599) | (3,796) | ||||||||||||||
| Segment operating income (loss) | 58,757 | 53,326 | 5,431 | ||||||||||||||
| Depreciation and amortization | (44,156) | (39,632) | (4,524) | ||||||||||||||
| Interest income (expense), net | (33,476) | (28,911) | (4,565) | ||||||||||||||
| Other income (loss), net | 408 | 2,282 | (1,874) | ||||||||||||||
| Equity in earnings (losses) from unconsolidated ventures | 5,817 | 1,905 | 3,912 | ||||||||||||||
| Gain (loss) on sale or disposal of real estate and other assets, net | 4,794 | 4,730 | 64 | ||||||||||||||
| Operating Assets segment EBT | (7,856) | (6,300) | (1,556) | ||||||||||||||
| Add back: | |||||||||||||||||
| Depreciation and amortization | 44,156 | 39,632 | 4,524 | ||||||||||||||
| Interest (income) expense, net | 33,476 | 28,911 | 4,565 | ||||||||||||||
| Equity in (earnings) losses from unconsolidated ventures | (5,817) | (1,905) | (3,912) | ||||||||||||||
| (Gain) loss on sale or disposal of real estate and other assets, net | (4,794) | (4,730) | (64) | ||||||||||||||
| Impact of straight-line rent | (847) | (1,113) | 266 | ||||||||||||||
| Other | (54) | (185) | 131 | ||||||||||||||
| Operating Assets NOI | 58,264 | 54,310 | 3,954 | ||||||||||||||
| Company's share of NOI from equity investments | 1,980 | 1,827 | 153 | ||||||||||||||
| Distributions from Summerlin Hospital investment | 3,242 | 3,033 | 209 | ||||||||||||||
| Company's share of NOI from unconsolidated ventures | 5,222 | 4,860 | 362 | ||||||||||||||
| Total Operating Assets NOI | $ | 63,486 | $ | 59,170 | $ | 4,316 | |||||||||||
11
| Three Months Ended March 31, | |||||||||||||||||
| thousands | 2024 | 2023 | Change | ||||||||||||||
Seaport Segment | |||||||||||||||||
| Total revenues | $ | 11,502 | $ | 11,897 | $ | (395) | |||||||||||
| Total operating expenses | (21,485) | (18,916) | (2,569) | ||||||||||||||
| Segment operating income (loss) | (9,983) | (7,019) | (2,964) | ||||||||||||||
| Depreciation and amortization | (5,757) | (10,527) | 4,770 | ||||||||||||||
| Interest income (expense), net | (2,012) | 1,186 | (3,198) | ||||||||||||||
| Other income (loss), net | — | 1 | (1) | ||||||||||||||
| Equity in earnings (losses) from unconsolidated ventures | (10,280) | (10,820) | 540 | ||||||||||||||
| Seaport segment EBT | (28,032) | (27,179) | (853) | ||||||||||||||
| Add back: | |||||||||||||||||
| Depreciation and amortization | 5,757 | 10,527 | (4,770) | ||||||||||||||
| Interest (income) expense, net | 2,012 | (1,186) | 3,198 | ||||||||||||||
| Equity in (earnings) losses from unconsolidated ventures | 10,280 | 10,820 | (540) | ||||||||||||||
| Impact of straight-line rent | 502 | 586 | (84) | ||||||||||||||
| Other (income) loss, net (a) | 876 | 847 | 29 | ||||||||||||||
| Seaport NOI | (8,605) | (5,585) | (3,020) | ||||||||||||||
| Company's share of NOI from unconsolidated ventures (b) | (8,902) | (9,591) | 689 | ||||||||||||||
| Total Seaport NOI | $ | (17,507) | $ | (15,176) | $ | (2,331) | |||||||||||
(a)Includes miscellaneous development-related items.
(b)The Company’s share of NOI related to the Tin Building by Jean-Georges is calculated using our current partnership funding provisions.
12
Same Store NOI - Operating Assets Segment
The Company defines Same Store Properties as consolidated and unconsolidated properties that are acquired or placed in-service prior to the beginning of the earliest period presented and owned by the Company through the end of the latest period presented. Same Store Properties exclude properties placed in-service, acquired, repositioned or in development or redevelopment after the beginning of the earliest period presented or disposed of prior to the end of the latest period presented. Accordingly, it takes at least one year and one quarter after a property is acquired or treated as in-service for that property to be included in Same Store Properties.
We calculate Same Store Net Operating Income (Same Store NOI) as Operating Assets NOI applicable to Same Store Properties. Same Store NOI also includes the Company's share of NOI from unconsolidated ventures and the annual distribution from a cost basis investment. Same Store NOI is a non-GAAP financial measure and should not be viewed as an alternative to net income calculated in accordance with GAAP as a measurement of our operating performance. We believe that Same Store NOI is helpful to investors as a supplemental comparative performance measure of the income generated from the same group of properties from one period to the next. Other companies may not define Same Store NOI in the same manner as we do; therefore, our computation of Same Store NOI may not be comparable to that of other companies. Additionally, we do not control investments in unconsolidated properties and while we consider disclosures of our share of NOI to be useful, they may not accurately depict the legal and economic implications of our investment arrangements.
| Three Months Ended March 31, | |||||||||||||||||
| thousands | 2024 | 2023 | $ Change | ||||||||||||||
| Same Store Office | |||||||||||||||||
| Houston, TX | $ | 20,243 | $ | 18,554 | $ | 1,689 | |||||||||||
| Columbia, MD | 6,098 | 6,177 | (79) | ||||||||||||||
| Las Vegas, NV | 4,258 | 3,054 | 1,204 | ||||||||||||||
| Total Same Store Office | 30,599 | 27,785 | 2,814 | ||||||||||||||
| Same Store Retail | |||||||||||||||||
| Houston, TX | 3,039 | 3,405 | (366) | ||||||||||||||
| Columbia, MD | 1,068 | 592 | 476 | ||||||||||||||
| Las Vegas, NV | 5,987 | 6,217 | (230) | ||||||||||||||
| Honolulu, HI | 4,478 | 4,519 | (41) | ||||||||||||||
| Total Same Store Retail | 14,572 | 14,733 | (161) | ||||||||||||||
| Same Store Multi-family | |||||||||||||||||
| Houston, TX | 9,716 | 9,527 | 189 | ||||||||||||||
| Columbia, MD | 2,612 | 1,158 | 1,454 | ||||||||||||||
| Las Vegas, NV | 1,788 | 1,948 | (160) | ||||||||||||||
| Company's share of NOI from unconsolidated ventures | 2,001 | 1,811 | 190 | ||||||||||||||
| Total Same Store Multi-family | 16,117 | 14,444 | 1,673 | ||||||||||||||
| Same Store Other | |||||||||||||||||
| Houston, TX | 955 | 1,507 | (552) | ||||||||||||||
| Columbia, MD | 451 | — | 451 | ||||||||||||||
| Las Vegas, NV | (1,845) | (2,398) | 553 | ||||||||||||||
| Honolulu, HI | (184) | 68 | (252) | ||||||||||||||
| Company's share of NOI from unconsolidated ventures | 3,221 | 3,049 | 172 | ||||||||||||||
| Total Same Store Other | 2,598 | 2,226 | 372 | ||||||||||||||
| Total Same Store NOI | 63,886 | 59,188 | 4,698 | ||||||||||||||
| Non-Same Store NOI | (400) | (18) | (382) | ||||||||||||||
| Total Operating Assets NOI | $ | 63,486 | $ | 59,170 | $ | 4,316 | |||||||||||
13
Cash G&A
The Company defines Cash G&A as General and administrative expense less non-cash stock compensation expense. Cash G&A is a non-GAAP financial measure that we believe is useful to our investors and other users of our financial statements as an indicator of overhead efficiency without regard to non-cash expenses associated with stock compensation. However, it should not be used as an alternative to general and administrative expenses in accordance with GAAP.
| Three Months Ended March 31, | |||||||||||||||||
| thousands | 2024 | 2023 | $ Change | ||||||||||||||
| General and Administrative | |||||||||||||||||
| General and administrative (G&A) (a)(b) | $ | 30,902 | $ | 23,553 | $ | 7,349 | |||||||||||
| Less: Non-cash stock compensation | (1,841) | (3,443) | 1,602 | ||||||||||||||
| Cash G&A | $ | 29,061 | $ | 20,110 | $ | 8,951 | |||||||||||
(a)G&A expense includes $1.6 million of severance and bonus costs and $2.1 million of non-cash stock compensation related to our former General Counsel for the first quarter of 2023.
(b)G&A expense for the first quarter of 2024 includes $9.2 million of expenses associated with the planned spinoff of Seaport Entertainment.
14
Howard Hughes Holdings Inc. Supplemental Information Three Months Ended March 31, 2024 NYSE: HHH Exhibit 99.2
HOWARD HUGHES 2 Cautionary StatementsCautionary Statements Forward-Looking Statements This presentation includes forward-looking statements. Forward-looking statements give our current expectations relating to our financial condition, results of operations, plans, objectives, future performance and business. You can identify forward-looking statements by the fact that they do not relate strictly to current or historical facts. These statements may include words such as “anticipate,” “estimate,” “expect,” “project,” “forecast,” “plan,” “intend,” "believe," “likely,” “may,” “realize,” “should,” “transform,” "will," “would” and other statements of similar expression. Forward-looking statements give our expectations about the future and are not guarantees. These statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance and achievements to materially differ from any future results, performance and achievements expressed or implied by such forward-looking statements. We caution you not to rely on these forward-looking statements. For a discussion of the risk factors that could have an impact on these forward-looking statements, see our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, as filed with the Securities and Exchange Commission (SEC) on February 27, 2024. The statements made herein speak only as of the date of this presentation, and we do not undertake to update this information except as required by law. Past performance does not guarantee future results. Performance during time periods shown is limited and may not reflect the performance for the full year or future years, or in different economic and market cycles. Non-GAAP Financial Measures Our financial statements have been prepared in accordance with accounting principles generally accepted in the United States (GAAP); however, we use certain non-GAAP performance measures in this presentation, in addition to GAAP measures, as we believe these measures improve the understanding of our operational results and make comparisons of operating results among peer companies more meaningful. Management continually evaluates the usefulness, relevance, limitations, and calculation of our reported non-GAAP performance measures to determine how best to provide relevant information to the public, and thus such reported measures could change. The non-GAAP financial measures used in this presentation are funds from operations (FFO), core funds from operations (Core FFO), adjusted funds from operations (AFFO), and net operating income (NOI). Non-GAAP financial measures should not be considered independently, or as a substitute, for financial information presented in accordance with GAAP. FFO is defined by the National Association of Real Estate Investment Trusts (NAREIT) as net income calculated in accordance with GAAP, excluding gains or losses from real estate dispositions, plus real estate depreciation and amortization and impairment charges (which we believe are not indicative of the performance of our operating portfolio). We calculate FFO in accordance with NAREIT’s definition. Since FFO excludes depreciation and amortization, gains and losses from depreciable property dispositions, and impairments, it can provide a performance measure that, when compared year over year, reflects the impact on operations from trends in occupancy rates, rental rates, operating costs, acquisition, development activities, and financing costs. This provides a perspective of our financial performance not immediately apparent from net income determined in accordance with GAAP. Core FFO is calculated by adjusting FFO to exclude the impact of certain non-cash and/or nonrecurring income and expense items, as set forth in the calculation herein. These items can vary greatly from period to period, depending upon the volume of our acquisition activity and debt retirements, among other factors. We believe that by excluding these items, Core FFO serves as a useful, supplementary measure of the ongoing operating performance of the core operations across all segments, and we believe it is used by investors in a similar manner. Finally, AFFO adjusts our Core FFO operating measure to deduct cash expended on recurring tenant improvements and capital expenditures of a routine nature to present an adjusted measure of Core FFO. Core FFO and AFFO are non-GAAP and non-standardized measures and may be calculated differently by other peer companies. We define NOI as operating revenues (rental income, tenant recoveries, and other revenue) less operating expenses (real estate taxes, repairs and maintenance, marketing, and other property expenses). NOI excludes straight-line rents and amortization of tenant incentives, net; interest expense, net; ground rent amortization; demolition costs; other income (loss); depreciation and amortization; development-related marketing costs; gain on sale or disposal of real estate and other assets, net; loss on extinguishment of debt; provision for impairment; and equity in earnings from unconsolidated ventures. We believe that NOI is a useful supplemental measure of the performance of our Operating Assets and Seaport segments because it provides a performance measure that reflects the revenues and expenses directly associated with owning and operating real estate properties. This amount is presented as Operating Assets NOI and Seaport NOI throughout this document. Total Operating Assets NOI and Total Seaport NOI represent NOI as defined above with the addition of our share of NOI from unconsolidated ventures. We use NOI to evaluate our operating performance on a property-by-property basis because NOI allows us to evaluate the impact that property-specific factors such as rental and occupancy rates, tenant mix, and operating costs have on our operating results, gross margins, and investment returns. While FFO, Core FFO, AFFO, and NOI are relevant and widely used measures of operating performance of real estate companies, they do not represent cash flows from operations or net income as defined by GAAP and should not be considered an alternative to those measures in evaluating our liquidity or operating performance. FFO, Core FFO, AFFO, and NOI do not purport to be indicative of cash available to fund our future cash requirements. Further, our computations of FFO, Core FFO, AFFO, and NOI may not be comparable to FFO, Core FFO, AFFO, and NOI reported by other real estate companies. We have included in this presentation a reconciliation from GAAP net income to FFO, Core FFO, and AFFO, as well as reconciliations of our GAAP Operating Assets segment earnings before taxes (EBT) to NOI and Seaport segment EBT to NOI. Additional Information Our website address is www.howardhughes.com. Our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and other publicly filed or furnished documents are available and may be accessed free of charge through the “Investors” section of our website under the "SEC Filings" subsection, as soon as reasonably practicable after those documents are filed with, or furnished to, the SEC. Also available through the Investors section of our website are beneficial ownership reports filed by our directors, officers, and certain shareholders on Forms 3, 4, and 5.
3 Table of Contents Table of Contents FINANCIAL OVERVIEW Definitions 4 Company Profile 5 Financial Summary 7 Balance Sheets 9 Statements of Operations 10 OPERATING PORTFOLIO PERFORMANCE Same Store Metrics 11 NOI by Region 13 Stabilized Properties 15 Unstabilized Properties 17 Under Construction Properties 18 Seaport Operating Performance 19 OTHER PORTFOLIO METRICS Completed Condominiums 20 Under Construction Condominiums 21 Predevelopment Condominiums 22 Summary of Remaining Development Costs 23 Portfolio Key Metrics 24 MPC Performance 25 MPC Land 26 Lease Expirations 27 Other Assets and Acquisition / Disposition Activity 28 Debt Summary 29 Reconciliations of Non-GAAP Measures 31
HOWARD HUGHES 4 Stabilized - Properties in the Operating Assets and Seaport segments that have been in service for more than 36 months or have reached 90% occupancy, whichever occurs first. If an office, retail, or multi-family property has been in service for more than 36 months but does not exceed 90% occupancy, the asset is considered underperforming. Unstabilized - Properties in the Operating Assets and Seaport segments that have been in service for less than 36 months and do not exceed 90% occupancy. Under Construction - Projects in the Strategic Developments and Seaport segments for which construction has commenced as of March 31, 2024, unless otherwise noted. This excludes Master Planned Community (MPC) and condominium development. Net Operating Income (NOI) - We define net operating income (NOI) as operating revenues (rental income, tenant recoveries, and other revenue) less operating expenses (real estate taxes, repairs and maintenance, marketing, and other property expenses). NOI excludes straight-line rents and amortization of tenant incentives, net; interest expense, net; ground rent amortization; demolition costs; other income (loss); depreciation and amortization; development-related marketing costs; gain on sale or disposal of real estate and other assets, net; loss on extinguishment of debt; provision for impairment; and equity in earnings from unconsolidated ventures. We use NOI to evaluate our operating performance on a property-by-property basis because NOI allows us to evaluate the impact that property-specific factor, such as lease structure, lease rates, and tenant bases, have on our operating results, gross margins, and investment returns. We believe that NOI is a useful supplemental measure of the performance of our Operating Assets and Seaport segments because it provides a performance measure that, when compared year over year, reflects the revenues and expenses directly associated with owning and operating real estate properties and the impact on operations from trends in rental and occupancy rates and operating costs. This amount is presented as Operating Assets NOI and Seaport NOI throughout this document. In-Place NOI - We define In-Place NOI as forecasted current year NOI for all properties included in the Operating Assets segment as of the end of the current period. Total Operating Assets NOI and Total Seaport NOI - These terms represent NOI as defined above with the addition of our share of NOI from unconsolidated ventures. Estimated Stabilized NOI - Estimated Stabilized NOI is initially projected prior to the development of the asset based on market assumptions and is revised over the life of the asset as market conditions evolve. On a quarterly basis, each asset’s In-Place NOI is compared to its Estimated Stabilized NOI in conjunction with forecast data to determine if an adjustment is needed. Adjustments to Estimated Stabilized NOI are made when changes to the asset's long-term performance are thought to be more than likely and permanent. Remaining Development Costs - Development costs and related debt held for projects that are under construction or substantially complete and in service in the Operating Assets segment are disclosed on the Summary of Remaining Development Costs slide if the project has more than $1.0 million of estimated costs remaining to be incurred. The total estimated costs and costs paid are prepared on a cash basis to reflect the total anticipated cash requirements for the projects. Projects not yet under construction are not included. Same Store Properties - The Company defines Same Store Properties as consolidated and unconsolidated properties that are acquired or placed in service prior to the beginning of the earliest period presented and owned by the Company through the end of the latest period presented. Same Store Properties exclude properties placed in service, acquired, repositioned, or in development or redevelopment after the beginning of the earliest period presented or disposed of prior to the end of the latest period presented. Accordingly, it takes at least one year and one quarter after a property is acquired or treated as in service for that property to be included in Same Store Properties. Same Store NOI - We calculate Same Store Net Operating Income (Same Store NOI) as Operating Assets NOI applicable to consolidated properties acquired or placed in service prior to the beginning of the earliest period presented and owned by the Company through the end of the latest period presented. Same Store NOI also includes the Company's share of NOI from unconsolidated ventures and the annual distribution from a cost basis investment. Same Store NOI is a non-GAAP financial measure and should not be viewed as an alternative to net income calculated in accordance with GAAP as a measurement of our operating performance. We believe that Same Store NOI is helpful to investors as a supplemental comparative performance measure of the income generated from the same group of properties from one period to the next. Other companies may not define Same Store NOI in the same manner as we do; therefore, our computation of Same Store NOI may not be comparable to that of other companies. Additionally, we do not control investments in unconsolidated properties, and while we consider disclosures of our share of NOI to be useful, they may not accurately depict the legal and economic implications of our investment arrangements. DefinitionsDefinitions
HOWARD HUGHES 5 The Park Ward Village 2% The Launiu 72% Ritz-Carlon Residences 22% Kalae 4% Bridgeland 68% Summerlin 29% Teravalis 3%Recent Company Highlights Q1 2024 Company Performance Diluted Earnings / Share $ (1.06) FFO / Diluted Share $ (0.06) Core FFO / Diluted Share $ (0.12) AFFO / Diluted Share $ (0.29) Operating Portfolio by Region Q1 '24 MPC EBT $24.3M Q1 '24 Condos Contracted 252 units NYSE: HHH Company Profile - Summary & Results HOUSTON, Mar. 4, 2024 - The community of Bridgeland has been named “Master Planned Community of the Year” by the National Association of Home Builders (NAHB), receiving top honors at The Nationals 2024 awards gala in Las Vegas. Bridgeland, an 11,500-acre master planned community in the Greater Houston region developed by Howard Hughes Holdings Inc. (HHH), was celebrated for its exceptional quality of life and natural setting only 30 miles northwest of Downtown Houston that have made it one of the top-selling communities in the nation. HONOLULU, Mar. 19, 2024 - Howard Hughes Holdings Inc. (HHH) announced a joint venture partnership with Discovery Land Company for the development of a new residential tower, ‘Ilima Ward Village, in the premier location within the acclaimed 60-acre master planned community of Ward Village in the heart of Honolulu. ‘Ilima is designed to deliver an unrivaled island living experience with a refined aesthetic, expansive amenities, and sweeping ocean and Diamond Head views. ‘Ilima, along with its companion tower Melia Ward Village, is being designed by celebrated architecture firm Robert A.M. Stern Architects. Office 48% Multi-family 26% Retail 21% Other 5% Q1 '24 Operating Assets NOI $63.5M Performance Highlights
HOWARD HUGHES 6 Office 32% Multi-family 41% Retail 27% Office 39% Multi-family 45% Retail 16% Office 49% Multi-family 26% Retail 19% Other 6% Office 52% Multi-family 21% Retail 20% Other 7% Office 27% Multi-family 65% Retail 8% Q1 2024 Path to Estimated Stabilized NOI Currently Under Construction Currently Unstabilized Currently Stabilized Total Estimated Stabilized NOI $30.9M Estimated Stabilized NOI $303.1M Estimated Stabilized NOI $357.8M Office 48% Multi-family 26% Retail 22% Other 4% Office 48% Multi-family 26% Retail 21% Other 5% Path to Estimated Stabilized NOI charts exclude Seaport NOI, units, and square footage. See page 19 for Seaport NOI and other project information. See page 4 for definitions of Under Construction, Unstabilized, Stabilized, and Net Operating Income (NOI). Q1 '24 Actual NOI $62.2M Q1 '24 Actual NOI $1.2M Q1 '24 Actual NOI $63.5M Estimated Stabilized NOI $23.8M Retail Sq. Ft. 153,900 Retail Sq. Ft. 80,777 Retail Sq. Ft. 2,197,067 Retail Sq. Ft. 2,431,744 Office Sq. Ft. 233,000 Office Sq. Ft. 265,898 Office Sq. Ft. 6,258,743 Office Sq. Ft. 6,757,641 Multi-family Units 268 Multi-family Units 1,029 Multi-family Units 4,558 Multi-family Units 5,855 Q1 2024 Operating Results by Property Type Currently Unstabilized Currently Stabilized Total Company Profile - Summary & Results (cont.)
HOWARD HUGHES 7 thousands except share price and billions Q1 2024 Q4 2023 Q3 2023 Q2 2023 Q1 2023 Company Profile Share price (a) $ 72.62 $ 85.55 $ 74.13 $ 78.92 $ 80.00 Market Capitalization (b) $3.6b $4.3b $3.7b $3.9b $4.0b Enterprise Value (c) $8.6b $9.0b $8.4b $8.5b $8.4b Weighted avg. shares - basic 49,663 49,618 49,616 49,581 49,455 Weighted avg. shares - diluted 49,663 49,681 49,616 49,581 49,455 Debt Summary Total debt payable (d) $ 5,437,935 $ 5,352,610 $ 5,247,534 $ 4,996,198 $ 4,831,044 Fixed-rate debt $ 3,597,886 $ 3,601,121 $ 3,597,960 $ 3,604,118 $ 3,607,734 Weighted avg. rate - fixed 4.59 % 4.59 % 4.55 % 4.55 % 4.55 % Variable-rate debt, excluding condominium financing $ 1,462,654 $ 1,444,085 $ 1,451,384 $ 1,277,571 $ 1,174,310 Weighted avg. rate - variable 7.93 % 7.89 % 7.79 % 6.37 % 6.20 % Condominium debt outstanding at end of period $ 377,395 $ 307,404 $ 198,190 $ 114,509 $ 49,000 Weighted avg. rate - condominium financing 9.66 % 9.74 % 9.91 % 7.17 % 7.00 % Leverage ratio (debt to enterprise value) 62.68 % 59.00 % 61.50 % 57.95 % 57.00 % General and Administrative General and administrative (G&A) (e)(f) $ 30,902 $ 25,822 $ 21,601 $ 20,217 $ 23,553 Less: Non-cash stock compensation (1,841) (1,725) (1,699) (1,606) (3,443) Cash G&A (g) $ 29,061 $ 24,097 $ 19,902 $ 18,611 $ 20,110 Financial Summary (a) Presented as of period end date. (b) Market capitalization = Closing share price as of the last trading day of the respective period times diluted weighted average shares. (c) Enterprise Value = Market capitalization + book value of debt + noncontrolling interest - cash and equivalents. (d) Represents total mortgages, notes, and loans payable, as stated in our GAAP financial statements as of the respective date, excluding unamortized deferred financing costs. (e) G&A expense includes $1.6 million of severance and bonus costs and $2.1 million of non-cash stock compensation related to our former General Counsel for the first quarter of 2023. (f) G&A expense includes $9.2 million in the first quarter of 2024 and $4.5 million in the fourth quarter of 2023 of expenses associated with the planned spinoff of Seaport Entertainment. (g) Cash G&A is a non-GAAP financial measure that we believe is useful to our investors and other users of our financial statements as an indicator of overhead efficiency without regard to non-cash expenses associated with stock compensation. However, it should not be used as an alternative to general and administrative expenses in accordance with GAAP. Financial Summary
HOWARD HUGHES 8 Financial Summary (a) The Company’s share of NOI related to the Tin Building by Jean-Georges and the Lawn Club is calculated using our current partnership funding provisions. (b) Excludes a $3.0 million charge in the first quarter of 2024 and a $16.1 million charge in the second quarter of 2023 of the estimated costs related to construction defects at the Waiea tower. The sixth and final amendment of resolution of disputes and release agreement was executed during the first quarter of 2024, thereby releasing the Company from any further claims or demands from the Waiea homeowners association arising from or relating to the construction or repair of the condominium project. HHH believes it should be entitled to recover all the repair costs from the general contractor, other responsible parties, and insurance proceeds; however, it can provide no assurances that all or any portion of the costs will be recovered. (c) The fluctuations in Condo adjusted gross profit are attributed to the timing of condo sales. The next tower, Victoria Place, is not scheduled for completion until late 2024. thousands Q1 2024 Q4 2023 Q3 2023 Q2 2023 Q1 2023 Segment Metrics Operating Assets Operating Assets NOI $ 58,264 $ 52,497 $ 60,710 $ 66,123 $ 54,310 Company's share of NOI from unconsolidated ventures 5,222 1,837 2,121 1,960 4,860 Total Operating Assets NOI $ 63,486 $ 54,334 $ 62,831 $ 68,083 $ 59,170 MPC MPC Segment EBT $ 24,251 $ 139,323 $ 84,798 $ 54,926 $ 62,372 Seaport Seaport NOI $ (8,605) $ (6,584) $ (902) $ (2,446) $ (5,585) Company's share of NOI from unconsolidated ventures (a) (8,902) (11,617) (8,603) (9,262) (9,591) Total Seaport NOI $ (17,507) $ (18,201) $ (9,505) $ (11,708) $ (15,176) Condo Gross Profit Condominium rights and unit sales $ 23 $ 792 $ 25,962 $ 14,866 $ 6,087 Adjusted condominium rights and unit cost of sales (b) (861) 973 (22,537) (13,191) (4,536) Condo adjusted gross profit (c) $ (838) $ 1,765 $ 3,425 $ 1,675 $ 1,551 Financial Summary (cont.)
HOWARD HUGHES 9 thousands except par values and share amounts (unaudited) March 31, 2024 December 31, 2023 ASSETS Master Planned Communities assets $ 2,481,538 $ 2,445,673 Buildings and equipment 4,207,900 4,177,677 Less: accumulated depreciation (1,071,110) (1,032,226) Land 303,380 303,685 Developments 1,438,924 1,272,445 Net investment in real estate 7,360,632 7,167,254 Investments in unconsolidated ventures 213,433 220,258 Cash and cash equivalents 462,700 631,548 Restricted cash 429,130 421,509 Accounts receivable, net 111,117 115,045 Municipal Utility District receivables, net 584,222 550,884 Deferred expenses, net 145,833 142,561 Operating lease right-of-use assets 45,649 44,897 Other assets, net 283,175 283,047 Total assets $ 9,635,891 $ 9,577,003 LIABILITIES Mortgages, notes, and loans payable, net $ 5,391,243 $ 5,302,620 Operating lease obligations 53,065 51,584 Deferred tax liabilities, net 70,697 87,835 Accounts payable and other liabilities 1,108,131 1,076,040 Total liabilities 6,623,136 6,518,079 EQUITY Preferred stock: $0.01 par value; 50,000,000 shares authorized, none issued — — Common stock: $0.01 par value; 150,000,000 shares authorized, 56,714,750 issued, and 50,243,739 outstanding as of March 31, 2024, 56,495,791 shares issued, and 50,038,014 outstanding as of December 31, 2023 567 565 Additional paid-in capital 3,993,152 3,988,496 Retained earnings (accumulated deficit) (436,173) (383,696) Accumulated other comprehensive income (loss) 3,897 1,272 Treasury stock, at cost, 6,471,011 shares as of March 31, 2024, and 6,457,777 shares as of December 31, 2023 (614,818) (613,766) Total stockholders' equity 2,946,625 2,992,871 Noncontrolling interests 66,130 66,053 Total equity 3,012,755 3,058,924 Total liabilities and equity $ 9,635,891 $ 9,577,003 Balance Sheets
HOWARD HUGHES 10 thousands except per share amounts (unaudited) Q1 2024 Q1 2023 REVENUES Condominium rights and unit sales $ 23 $ 6,087 Master Planned Communities land sales 32,415 59,361 Rental revenue 107,751 97,864 Other land, rental, and property revenues 18,383 18,968 Builder price participation 12,566 14,009 Total revenues 171,138 196,289 EXPENSES Condominium rights and unit cost of sales 3,861 4,536 Master Planned Communities cost of sales 12,904 22,003 Operating costs 74,289 72,387 Rental property real estate taxes 14,695 15,419 Provision for (recovery of) doubtful accounts 834 (2,420) General and administrative 30,902 23,553 Depreciation and amortization 52,247 52,009 Other 3,818 3,571 Total expenses 193,550 191,058 OTHER Gain (loss) on sale or disposal of real estate and other assets, net 4,794 4,730 Other income (loss), net 891 4,981 Total other 5,685 9,711 Operating income (loss) (16,727) 14,942 Interest income 8,118 4,092 Interest expense (41,918) (38,137) Equity in earnings (losses) from unconsolidated ventures (19,135) (4,802) Income (loss) before income taxes (69,662) (23,905) Income tax expense (benefit) (17,195) (1,278) Net income (loss) (52,467) (22,627) Net (income) loss attributable to noncontrolling interests (10) (118) Net income (loss) attributable to common stockholders $ (52,477) $ (22,745) Basic income (loss) per share $ (1.06) $ (0.46) Diluted income (loss) per share $ (1.06) $ (0.46) Statements of Operations
HOWARD HUGHES 11 thousands YTD Q1 2024 YTD Q1 2023 $ Change % Change Same Store Office Houston, TX $ 20,243 $ 18,554 $ 1,689 9 % Columbia, MD 6,098 6,177 (79) (1) % Las Vegas, NV 4,258 3,054 1,204 39 % Total Same Store Office 30,599 27,785 2,814 10 % Same Store Retail Houston, TX 3,039 3,405 (366) (11) % Columbia, MD 1,068 592 476 80 % Las Vegas, NV 5,987 6,217 (230) (4) % Honolulu, HI 4,478 4,519 (41) (1) % Total Same Store Retail 14,572 14,733 (161) (1) % Same Store Multi-family Houston, TX 9,716 9,527 189 2 % Columbia, MD 2,612 1,158 1,454 126 % Las Vegas, NV 1,788 1,948 (160) (8) % Company's share of NOI from unconsolidated ventures 2,001 1,811 190 10 % Total Same Store Multi-family 16,117 14,444 1,673 12 % Same Store Other Houston, TX 955 1,507 (552) (37) % Columbia, MD 451 — 451 100% Las Vegas, NV (1,845) (2,398) 553 23 % Honolulu, HI (184) 68 (252) (371) % Company's share of NOI from unconsolidated ventures 3,221 3,049 172 6 % Total Same Store Other 2,598 2,226 372 17 % Total Same Store NOI 63,886 59,188 4,698 8 % Non-Same Store NOI (400) (18) (382) (2122) % Total Operating Assets NOI $ 63,486 $ 59,170 $ 4,316 7 % See page 4 for definitions of Same Store Properties and Same Store NOI. Same Store NOI - Operating Assets Segment
HOWARD HUGHES 12 thousands Q1 2024 Q4 2023 Q3 2023 Q2 2023 Q1 2023 Same Store Metrics Stabilized Leasing Percentages Office 88 % 88 % 87 % 89 % 86 % Retail 95 % 96 % 95 % 96 % 96 % Multi-family 95 % 95 % 96 % 98 % 95 % Unstabilized Leasing Percentages Office 90 % 90 % 77 % 72 % 52 % Retail 66 % 66 % 64 % 46 % 46 % Multi-Family 65 % 57 % 72 % 61 % 34 % Same Store NOI Office $ 30,599 $ 27,493 $ 29,293 $ 33,597 $ 27,785 Retail 14,572 11,709 12,912 12,645 14,733 Multi-family 16,117 15,457 16,043 14,865 14,444 Other 2,598 224 4,825 6,666 2,226 Total Same Store NOI $ 63,886 $ 54,883 $ 63,073 $ 67,773 $ 59,188 Quarter over Quarter Change in Same Store NOI 16 % (13) % (7) % 15 % See page 4 for definitions of Same Store Properties and Same Store NOI. Same Store Performance - Operating Assets Segment
HOWARD HUGHES 13 thousands except Sq. Ft. and units % Ownership (a) Total Q1 2024 Occupied (b) Q1 2024 Leased (b) Q1 2024 Occupied (%) Q1 2024 Leased (%) In-Place NOI Estimated Stabilized NOI Time to Stabilize (Years) (c)Sq. Ft. Units Sq. Ft. Units Sq. Ft. Units Sq. Ft. Units Sq. Ft. Units Stabilized Properties Office - Houston 100% 3,969,487 — 3,446,303 — 3,555,444 — 87 % — % 90 % — % $ 80,840 $ 107,400 — Office - Columbia 100% 1,753,291 — 1,318,299 — 1,455,618 — 75 % — % 83 % — % 19,880 33,520 — Office - Summerlin 100% 535,965 — 500,274 — 506,810 — 93 % — % 95 % — % 13,000 15,680 — Retail - Houston 100% 352,064 — 298,584 — 321,953 — 85 % — % 91 % — % 11,070 12,400 — Retail - Columbia 100% 101,609 — 101,609 — 101,609 — 100 % — % 100 % — % 2,680 2,720 — Retail - Hawai‘i 100% 808,569 — 753,595 — 763,832 — 93 % — % 94 % — % 13,410 18,930 — Retail - Summerlin 100% 803,145 — 749,902 — 769,415 — 93 % — % 96 % — % 22,010 26,300 — Multi-family - Houston (d) 100% 34,386 2,968 30,509 2,760 32,220 2,809 89 % 93 % 94 % 95 % 38,920 40,000 — Multi-family - Columbia (d) Various 97,294 1,199 74,589 1,115 87,585 1,135 77 % 93 % 90 % 95 % 16,420 16,870 — Multi-family - Summerlin 100% — 391 — 367 — 374 — % 94 % — % 96 % 7,410 7,650 — Other - Summerlin (e) Various — — — — — — — % — % — % — % 9,050 14,280 — Other Assets (e) Various 135,801 — 135,801 — 135,801 — 100 % — % 100 % — % 5,020 7,380 — Total Stabilized Properties (f) $ 239,710 $ 303,130 — Unstabilized Properties Office - Summerlin 100% 265,898 — 189,678 — 239,166 — 71 % — % 90 % — % 4,170 8,380 1.8 Retail - Hawai‘i 100% 48,170 — 10,488 — 31,840 — 22 % — % 66 % — % 950 2,440 1.6 Multi-family - Houston 100% — 263 — 56 — 74 — % 21 % — % 28 % (930) 4,860 2.0 Multi-family - Columbia (d) 100% 32,607 472 — 285 22,496 309 — % 60 % 69 % 65 % 5,750 9,320 1.8 Multi-Family - Summerlin 100% — 294 — 80 — 91 — % 27 % — % 31 % 2,160 5,890 2.8 Total Unstabilized Properties $ 12,100 $ 30,890 2.1 NOI by Region, excluding Seaport
HOWARD HUGHES 14 NOI by RegionNOI by Region, excluding Seaport (cont.) (a) Includes our share of NOI from our unconsolidated ventures. (b) Occupied and Leased metrics are as of March 31, 2024. (c) The expected stabilization date used in the Time to Stabilize calculation for all unstabilized and under construction assets is set at the maximum stabilization period of 36 months from the in-service or expected in-service date. If an Unstabilized property achieves 90% occupancy prior to this date, it will move to Stabilized. (d) Multi-family square feet represent ground floor retail whereas multi-family units represent residential units for rent. (e) These assets can be found on page 16 of this presentation. (f) For Stabilized Properties, the difference between In-Place NOI and Estimated Stabilized NOI is attributable to a number of factors which may include temporary abatements, timing of lease turnovers, free rent, and other market factors. thousands except Sq. Ft. and units % Ownership (a) Total Q1 2024 Occupied (b) Q1 2024 Leased (b) Q1 2024 Occupied (%) Q1 2024 Leased (%) In-Place NOI Estimated Stabilized NOI Time to Stabilize (Years) (c)Sq. Ft. Units Sq. Ft. Units Sq. Ft. Units Sq. Ft. Units Sq. Ft. Units Under Construction Properties Office - Columbia 100 % 86,000 — — — — — — % — % — % — % n/a $ 3,200 2.8 Office - Summerlin 100 % 147,000 — — — — — — % — % — % — % n/a 4,300 3.8 Retail - Houston 100 % 28,000 — — — — — — % — % — % — % n/a 1,930 4.3 Retail - Hawai‘i 100 % 58,900 — — — — — — % — % — % — % n/a 2,660 4.0 Retail - Summerlin 100 % 67,000 — — — — — — % — % — % — % n/a 1,800 2.8 Multi-family - Houston 100 % — 268 — — — — — % — % — % — % n/a 9,890 3.8 Total Under Construction Properties n/a $ 23,780 3.6 Total / Wtd. Avg. for Portfolio $ 251,810 $ 357,800 3.1
HOWARD HUGHES 15 thousands except Sq. Ft. and units Location % Ownership Rentable Sq. Ft. Q1 2024 % Occupied (a) Q1 2024 % Leased (a) In-Place NOI (b) Est. Stabilized NOI (b) Office One Hughes Landing Houston, TX 100 % 200,639 61 % 65 % $ 2,350 $ 5,200 Two Hughes Landing Houston, TX 100 % 197,950 87 % 87 % 4,460 5,270 Three Hughes Landing Houston, TX 100 % 321,649 83 % 94 % 7,410 8,580 1725 Hughes Landing Boulevard Houston, TX 100 % 339,608 51 % 52 % (80) 7,430 1735 Hughes Landing Boulevard Houston, TX 100 % 318,237 100 % 100 % 8,120 8,370 2201 Lake Woodlands Drive Houston, TX 100 % 22,259 100 % 100 % 480 490 Lakefront North Houston, TX 100 % 258,058 98 % 98 % 6,630 6,530 8770 New Trails Houston, TX 100 % 180,000 100 % 100 % 4,650 4,740 9303 New Trails Houston, TX 100 % 98,283 42 % 42 % 90 1,530 3831 Technology Forest Drive Houston, TX 100 % 97,360 100 % 100 % 2,530 2,450 3 Waterway Square Houston, TX 100 % 227,617 91 % 91 % 4,000 5,900 4 Waterway Square Houston, TX 100 % 217,952 83 % 90 % 4,370 5,900 The Woodlands Towers at the Waterway (c) Houston, TX 100 % 1,395,599 96 % 99 % 34,340 43,510 1400 Woodloch Forest Houston, TX 100 % 94,276 83 % 84 % 1,490 1,500 Columbia Office Properties Columbia, MD 100 % 67,066 83 % 83 % 570 1,190 Merriweather Row Columbia, MD 100 % 925,584 73 % 77 % 7,310 12,930 One Mall North Columbia, MD 100 % 99,806 49 % 49 % 310 1,280 One Merriweather Columbia, MD 100 % 209,959 99 % 99 % 5,300 5,820 Two Merriweather Columbia, MD 100 % 124,639 87 % 94 % 1,880 3,100 6100 Merriweather Columbia, MD 100 % 326,237 69 % 98 % 4,510 9,200 Aristocrat Las Vegas, NV 100 % 181,534 100 % 100 % 4,440 4,520 One Summerlin Las Vegas, NV 100 % 207,292 85 % 86 % 5,910 6,440 Two Summerlin Las Vegas, NV 100 % 147,139 97 % 100 % 2,650 4,720 Total Office 6,258,743 $ 113,720 $ 156,600 Retail Creekside Park West Houston, TX 100 % 72,976 85 % 92 % $ 2,070 $ 2,200 Hughes Landing Retail Houston, TX 100 % 125,709 81 % 92 % 4,670 4,990 1701 Lake Robbins Houston, TX 100 % 12,376 100 % 100 % 520 540 Lakeland Village Center at Bridgeland Houston, TX 100 % 67,947 82 % 88 % 920 1,800 20/25 Waterway Avenue Houston, TX 100 % 51,543 87 % 87 % 2,000 2,000 Waterway Square Retail Houston, TX 100 % 21,513 100 % 100 % 890 870 Color Burst Park Retail Columbia, MD 100 % 12,410 100 % 100 % 330 410 Rouse Building Columbia, MD 100 % 89,199 100 % 100 % 2,350 2,310 Ward Village Retail Honolulu, HI 100 % 808,569 93 % 94 % 13,410 18,930 Downtown Summerlin (d) Las Vegas, NV 100 % 803,145 93 % 96 % 22,010 26,300 Total Retail 2,065,387 $ 49,170 $ 60,350 Stabilized PropertiesStabilized Properties - Operating Assets Segment
HOWARD HUGHES 16 Q1 2024 % Occupied (a) Q1 2024 % Leased (a) Estimated Stabilized NOI (b)thousands except Sq. Ft. and units Location % Ownership Rentable Sq. Ft. Units Rentable Sq. Ft. Units Rentable Sq. Ft. Units In-Place NOI (b) Multi-family Creekside Park Houston, TX 100 % — 292 n/a 94 % n/a 95 % $ 2,840 $ 3,000 Creekside Park The Grove Houston, TX 100 % — 360 n/a 94 % n/a 97 % 4,080 4,210 Lakeside Row Houston, TX 100 % — 312 n/a 91 % n/a 92 % 2,790 3,090 Millennium Six Pines Houston, TX 100 % — 314 n/a 93 % n/a 94 % 3,730 3,770 Millennium Waterway Houston, TX 100 % — 393 n/a 95 % n/a 96 % 3,870 3,910 One Lakes Edge Houston, TX 100 % 22,971 390 83 % 94 % 91 % 96 % 7,280 7,260 The Lane at Waterway Houston, TX 100 % — 163 n/a 91 % n/a 94 % 2,640 2,610 Two Lakes Edge Houston, TX 100 % 11,415 386 100 % 93 % 100 % 95 % 8,400 8,750 Starling at Bridgeland Houston, TX 100 % — 358 — % 90 % — % 92 % 3,290 3,400 Juniper Columbia, MD 100 % 55,677 382 66 % 94 % 89 % 95 % 8,700 9,160 The Metropolitan Columbia, MD 50 % 13,591 380 72 % 93 % 72 % 94 % 3,400 3,460 TEN.m.flats Columbia, MD 50 % 28,026 437 100 % 92 % 100 % 95 % 4,320 4,250 Constellation Las Vegas, NV 100 % — 124 n/a 96 % n/a 99 % 2,280 2,500 Tanager Las Vegas, NV 100 % — 267 n/a 93 % n/a 94 % 5,130 5,150 Total Multi-family (e) 131,680 4,558 $ 62,750 $ 64,520 Other Hughes Landing Daycare Houston, TX 100 % 10,000 n/a 100 % n/a 100 % n/a $ 440 $ 280 The Woodlands Warehouse Houston, TX 100 % 125,801 n/a 100 % n/a 100 % n/a 1,430 1,520 Woodlands Sarofim Houston, TX 20 % n/a n/a n/a n/a n/a n/a 200 250 Stewart Title of Montgomery County, TX Houston, TX 50 % n/a n/a n/a n/a n/a n/a — 1,600 Houston Ground Leases Houston, TX 100 % n/a n/a n/a n/a n/a n/a 2,590 3,160 Kewalo Basin Harbor Honolulu, HI 100 % n/a n/a n/a n/a n/a n/a 1,910 1,900 Hockey Ground Lease Las Vegas, NV 100 % n/a n/a n/a n/a n/a n/a 640 590 Summerlin Hospital Medical Center Las Vegas, NV 5 % n/a n/a n/a n/a n/a n/a 3,000 4,640 Las Vegas Ballpark (f) Las Vegas, NV 100 % n/a n/a n/a n/a n/a n/a 5,410 9,050 Other Assets Various 100 % n/a n/a n/a n/a n/a n/a (1,550) (1,330) Total Other 135,801 — $ 14,070 $ 21,660 Total Stabilized $ 239,710 $ 303,130 (a) Percentage Occupied and Percentage Leased are as of March 31, 2024. (b) For Stabilized Properties, the difference between In-Place NOI and Stabilized NOI is attributable to a number of factors which may include temporary abatements, timing of lease turnovers, free rent, and other market factors. (c) 1201 Lake Robbins and 9950 Woodloch Forest, are collectively known as The Woodlands Towers at the Waterway. (d) Downtown Summerlin rentable sq. ft. excludes 381,767 sq. ft. of anchor space and 39,700 sq. ft. of office space. (e) Multi-family square feet represent ground floor retail whereas multi-family units represent residential units for rent. (f) The Las Vegas Ballpark presentation is inclusive of the results from both the stadium operations and those of our wholly owned team, the Las Vegas Aviators. Stabilized Properties - Operating Assets Segment (cont.)
HOWARD HUGHES 17 Q1 2024 % Occupied (a) Q1 2024 % Leased (a) Development Costs Incurred to Date Total Estimated Development Costs In-Place NOI Est. Stabilized NOI (b) Est. Stab. Date (c) Est. Stab. Yield thousands except Sq. Ft. and units Location % Ownership Rentable Sq. Ft. Units Rentable Sq. Ft. Units Rentable Sq. Ft. Units Office 1700 Pavilion Las Vegas, NV 100 % 265,898 — 71 % n/a 90 % n/a $ 103,644 $ 123,015 $ 4,170 $ 8,380 2025 7 % Total Office 265,898 — $ 103,644 $ 123,015 $ 4,170 $ 8,380 Retail A'ali'i (d) Honolulu, HI 100 % 11,175 — 60 % n/a 100 % n/a $ — $ — $ 330 $ 550 2025 — % Kō'ula (d) Honolulu, HI 100 % 36,995 — 10 % n/a 56 % n/a — — 620 1,890 2025 — % Total Retail 48,170 — $ — $ — $ 950 $ 2,440 Multi-family Wingspan (e) Houston, TX 100 % — 263 — % 21 % — % 28 % $ 65,173 $ 87,048 $ (930) $ 4,860 2026 6 % Tanager Echo Las Vegas, NV 100 % — 294 — % 27 % — % 31 % 85,588 86,853 2,160 5,890 2026 7 % Marlow Columbia, MD 100 % 32,607 472 — % 60 % 69 % 65 % 120,329 130,490 5,750 9,320 2025 7 % Total Multi-Family (f) 32,607 1,029 $ 271,090 $ 304,391 $ 6,980 $ 20,070 Total Unstabilized $ 374,734 $ 427,406 $ 12,100 $ 30,890 (a) Percentage Occupied and Percentage Leased are as of March 31, 2024. (b) Company estimates of Estimated Stabilized NOI are based on current leasing velocity, excluding inflation and organic growth. (c) The expected stabilization date for all unstabilized assets is set at the maximum stabilization period of 36 months from the in-service date. If a property achieves 90% occupancy prior to this date, it will move to Stabilized. (d) Condominium retail Development costs incurred to date and Total estimated development costs are combined with their respective condominium costs on page 20 of this supplement. (e) Wingspan, our first single-family rental community in Bridgeland, welcomed its first residents in October 2023. As of March 31, 2024, 63% of the property has been placed in service. The remaining 37% is expected to be placed in service in the second quarter of 2024. (f) Multi-family square feet represent ground floor retail, whereas multi-family units represent residential units for rent. Unstabilized Properties - Operating Assets Segment
HOWARD HUGHES 18 Under Construction Properties thousands except Sq. Ft. and units Location % Ownership Estimated Rentable Square Feet Percent Pre- Leased (a) Const. Start Date Est. Stabilized Date (b) Development Costs Incurred to Date Total Estimated Development Costs Est. Stabilized NOI Est. Stab. Yield Office 10285 Lakefront Medical Office Columbia, MD 100 % 86,000 48 % Q3 2022 2027 $ 26,609 $ 49,930 $ 3,200 6 % Meridian (c) Las Vegas, NV 100 % 147,000 — % Q4 2022 2027 31,224 55,459 4,300 8 % Total Office 233,000 $ 57,833 $ 105,389 $ 7,500 Retail Village Green at Bridgeland Central Houston, TX 100 % 28,000 16 % Q1 2024 2028 $ 3,237 $ 22,159 $ 1,930 9 % Summerlin Grocery Anchored Center Las Vegas, NV 100 % 67,000 75 % Q3 2023 2027 10,161 46,372 1,800 4 % Ulana Ward Village (d) Honolulu, HI 100 % 32,100 — % Q1 2023 2028 — — 760 — % The Park Ward Village (d) Honolulu, HI 100 % 26,800 — % Q4 2022 2028 — — 1,900 — % Total Retail 153,900 $ 13,398 $ 68,531 $ 6,390 in thousands except Sq. Ft. and units Location % Ownership # of Units Monthly Est. Rent Per Unit Const. Start Date Est. Stabilized Date (b) Develop. Costs Incurred Est. Total Cost (Excl. Land) Est. Stabilized NOI Est. Stab. Yield Multi-family 1 Riva Row Houston, TX 100 % 268 $ 4,015 Q3 2023 2028 $ 18,652 $ 155,997 $ 9,890 6 % Total Multi-family 268 $ 18,652 $ 155,997 $ 9,890 Total Under Construction $ 89,883 $ 329,917 $ 23,780 (a) Represents leases signed as of March 31, 2024. (b) The expected stabilization date for all under construction assets is set 36 months from the expected in-service date. (c) Subsequent to quarter end, Meridian was completed and placed in-service. (d) Condominium retail Development costs incurred to date and Total estimated development costs are combined with their respective condominium costs on page 21 of this supplement. Under Construction Properties - Strategic Developments Segment
HOWARD HUGHES 19 NOI by Region Q1 2024 Landlord Operations (a) Landlord Operations - Multi-family (b) Managed Businesses (c) Tin Building (d) Events and Sponsorships (e) Q1 2024 Totalthousands except sq. ft. Revenues (f) $ 3,271 $ 346 $ 4,004 $ 2,853 $ 1,028 $ 11,502 Operating expenses (f) (9,526) (197) (7,146) (662) (3,954) (21,485) Adjustments to arrive at NOI 1,402 (91) — 67 1,378 Seaport NOI $ (4,853) $ 58 $ (3,142) $ 2,258 $ (2,926) $ (8,605) Company's share of NOI from unconsolidated ventures (f) — — (156) (8,746) — (8,902) Total Seaport NOI (g) $ (4,853) $ 58 $ (3,298) $ (6,488) $ (2,926) $ (17,507) Rentable Square Feet / Units Total square feet / units 322,860 13,000 / 21 71,272 53,783 24,577 Leased square feet / units (h) 178,373 — / 21 65,660 53,783 24,577 % Leased (h) 55 % — % / 100 % 92 % 100 % 100 % Development Development costs incurred to date $ 568,216 $ — $ — $ 201,961 $ — $ 770,177 (a) Landlord Operations represents physical real estate in the Historic District and Pier 17 developed and owned by HHH and leased to third parties. (b) Landlord Operations - Multi-family represents 85 South Street which includes base level retail in addition to residential units. (c) Managed Businesses represents retail and food and beverage businesses in the Historic District and Pier 17 that HHH owns, either wholly or through joint ventures, and operates, including license and management agreements. For the three months ended March 31, 2024, these businesses include, among others, The Fulton, Mister Dips, Carne Mare, and Malibu Farm. Managed Businesses also includes the Company's share of NOI from Lawn Club and Jean-Georges Restaurants. During the third quarter of 2023, the Ssäm Bar restaurant closed. The Company and Momofuku are in the process of dissolving the venture. (d) The Company owns 100% of the Tin Building (Landlord Operations) with 100% of the space leased to The Tin Building by Jean-Georges joint venture, in which the Company has an equity ownership interest. (e) Events and Sponsorships includes private events, catering, sponsorships, concert series, and other rooftop activities. (f) Rental revenue earned from and expense paid by businesses we wholly own and operate is eliminated in consolidation. For joint ventures where the Company is the landlord, the Company recognizes 100% of rental revenue earned. The Company’s share of rental expense paid by joint ventures is included in the Company’s share of NOI from unconsolidated ventures. (g) Total Seaport NOI includes NOI from businesses we wholly own and operate as well as the Company's share of NOI from unconsolidated ventures. See page 32 for the reconciliation of Total Seaport NOI. (h) Leased square footage and percent leased for Landlord Operations includes agreements with terms of less than one year. Seaport Operating Performance
HOWARD HUGHES 20 As of March 31, 2024 Waiea Anaha Ae`o Ke Kilohana ‘A‘ali‘i Kō'ula Total Key Metrics ($ in thousands) Location Ward Village Ward Village Ward Village Ward Village Ward Village Ward Village Type of building Luxury Luxury Upscale Workforce Upscale Upscale Number of units 177 317 465 423 750 565 2,697 Condo Sq. Ft. 378,488 449,205 389,663 294,273 390,097 409,612 2,311,338 Street retail Sq. Ft. 7,716 16,048 70,800 28,386 11,175 36,995 171,120 Stabilized retail NOI $290 $1,190 $2,170 $970 $550 $1,890 $7,060 Stabilization year 2017 2020 2019 2020 2025 2025 Development progress ($ in thousands) Completion date Q4 2016 Q4 2017 Q4 2018 Q2 2019 Q4 2021 Q3 2022 Total estimated development cost $627,254 $403,796 $430,086 $217,318 $390,437 $487,039 $2,555,930 Development costs incurred to date 610,522 403,796 430,086 217,318 384,444 450,965 2,497,131 Estimated remaining to be spent $16,732 $— $— $— $5,993 $36,074 $58,799 Financial Summary ($ in thousands) Units closed through Q1 2024 177 317 465 423 750 565 2,697 Total % of units closed or under contract 100% 100% 100% 100% 100% 100% 100% Units closed in Q1 2024 — — — — — — — Total GAAP revenue recognized $698,228 $515,882 $512,981 $218,549 $536,942 $635,071 $3,117,653 Completed Condominiums
HOWARD HUGHES 21 As of March 31, 2024 Victoria Place The Park Ward Village Ulana Ward Village Total Key Metrics ($ in thousands) Location Ward Village Ward Village Ward Village Type of building Luxury Upscale Workforce Number of units 349 545 696 1,590 Avg. unit Sq. Ft. 1,164 847 623 819 Condo Sq. Ft. 406,351 461,360 433,773 1,301,484 Street retail Sq. Ft. (a) n/a 26,800 32,100 58,900 Stabilized retail NOI n/a $1,900 $760 $2,660 Stabilization year n/a 2028 2028 Development progress ($ in thousands) Start date Q1 2021 Q4 2022 Q1 2023 Estimated Completion date Q4 2024 2026 2025 Total estimated development cost $511,343 $605,150 $402,914 $1,519,407 Development costs incurred to date 383,594 159,314 119,502 662,410 Estimated remaining to be spent $127,749 $445,836 $283,412 $856,997 Financial Summary ($ in thousands) Units under contract through March 31, 2024 349 517 696 1,562 Units remaining to be sold through March 31, 2024 — 28 — 28 Total % of units closed or under contract 100.0% 94.9% 100.0% 98.2% Units under contract in Q1 2024 — 5 — 5 Square footage closed / under contract 406,351 440,242 433,773 1,280,366 Total % square footage closed / under contract 100.0% 95.4% 100.0% 98.4% Total cash received (closings & deposits) $159,901 $135,841 $37,482 $333,224 Total future GAAP revenue under contract $777,314 $680,870 $372,581 $1,830,765 Expected avg. price per Sq. Ft. $1,850 - $1,900 $1,500 - $1,550 $850 - $900 Deposit Reconciliation (thousands) Spent towards construction $152,755 $42,918 $37,225 $232,898 Held for future use (b) — 90,997 257 91,254 Held for closings (b) 7,146 1,926 — 9,072 Total deposits from sales commitment $159,901 $135,841 $37,482 $333,224 (a) Expected construction cost per retail square foot for all completed, under construction, and predevelopment condos is approximately $1,300. (b) Total deposits held for future use and held for closings are included in Restricted cash. Under Construction Condominiums
HOWARD HUGHES 22 As of March 31, 2024 Kalae The Launiu The Ritz-Carlton Residences Total Key Metrics ($ in thousands) Location Ward Village Ward Village The Woodlands Type of building Luxury Luxury Luxury Number of units 329 485 111 925 Avg. unit Sq. Ft. 1,207 950 2,524 1,230 Condo Sq. Ft. 397,203 460,735 280,172 1,138,110 Street retail Sq. Ft. (a) 2,000 10,000 5,800 17,800 Estimated Completion date 2027 2027 2027 Financial Summary ($ in thousands) Units under contract through March 31, 2024 296 182 56 534 Units remaining to be sold through March 31, 2024 33 303 55 391 Total % of units closed or under contract 90.0% 37.5% 50.5% 57.7% Units under contract in Q1 2024 9 182 56 247 Square footage closed / under contract 368,929 161,336 149,073 679,338 Total % square footage closed / under contract 92.9% 35.0% 53.2% 59.7% Total cash received (closings & deposits) $148,809 $31,802 $13,973 $194,584 Total future GAAP revenue under contract $749,657 $298,957 $245,750 $1,294,364 Expected avg. price per Sq. Ft. $2,000 - $2,050 $1,850 - $1,900 $1,650 - $1,700 Deposit Reconciliation (thousands) Held for future use (b) $148,809 $31,802 $— $180,611 Held for closings (b) — — 13,973 13,973 Total deposits from sales commitment $148,809 $31,802 $13,973 $194,584 (a) Expected construction cost per retail square foot for all completed, under construction, and predevelopment condos is approximately $1,300. (b) Total deposits held for future use and held for closings are included in Restricted cash. Predevelopment Condominiums
HOWARD HUGHES 23 As of March 31, 2024 thousands Location Total Estimated Development Costs (a) Development Costs Incurred to Date Estimated Remaining to be Spent Remaining Buyer Deposits/ Holdback to be Drawn Debt to be Drawn Costs Remaining to be Paid, Net of Debt and Buyer Deposits/ Holdbacks to be Drawn (b) Estimated Completion Date Juniper (c) Columbia, MD $ 116,386 $ 114,055 $ 2,331 $ — $ — $ 2,331 Completed Marlow (c) Columbia, MD 130,490 120,329 10,161 — 9,511 650 Completed 6100 Merriweather (c) Columbia, MD 138,221 121,148 17,073 — — 17,073 Completed Starling at Bridgeland (d) Houston, TX 60,572 56,349 4,223 — 4,722 (499) Completed Wingspan (e) Houston, TX 87,048 65,173 21,875 — 19,091 2,784 Completed 1700 Pavilion (c) Las Vegas, NV 123,015 103,644 19,371 — 15,763 3,608 Completed Tanager Echo Las Vegas, NV 86,853 85,588 1,265 — 42 1,223 Completed Total Operating Assets 742,585 666,286 76,299 — 49,129 27,170 10285 Lakefront Medical Office (d) Columbia, MD 49,930 26,609 23,321 — 23,758 (437) Q2 2024 1 Riva Row Houston, TX 155,997 18,652 137,345 — 93,299 44,046 2025 Village Green at Bridgeland Central Houston, TX 22,159 3,237 18,922 — 16,900 2,022 2025 Meridian Las Vegas, NV 55,459 31,224 24,235 — 24,134 101 Q2 2024 Summerlin Grocery Anchored Center Las Vegas, NV 46,372 10,161 36,211 — 18,000 18,211 Q3 2024 ‘A‘ali‘i Honolulu, HI 390,437 384,444 5,993 — — 5,993 Completed Kō'ula Honolulu, HI 487,039 450,965 36,074 16,179 — 19,895 Completed The Park Ward Village Honolulu, HI 605,150 159,314 445,836 93,984 350,758 1,094 2026 Ulana Ward Village Honolulu, HI 402,914 119,502 283,412 — 212,024 71,388 2025 Victoria Place Honolulu, HI 511,343 383,594 127,749 — 73,717 54,032 Q4 2024 Waiea (f) Honolulu, HI 627,254 610,522 16,732 — — 16,732 Completed Total Strategic Developments 3,354,054 2,198,224 1,155,830 110,163 812,590 233,077 Total $ 4,096,639 $ 2,864,510 $ 1,232,129 $ 110,163 $ 861,719 $ 260,247 See page 4 for definition of Remaining Development Costs. (a) Total Estimated Development Costs represent all costs to be incurred on the project which include construction costs, demolition costs, marketing costs, capitalized leasing, payroll or project development fees, deferred financing costs, retail costs, and certain accrued costs from lenders and excludes land costs and capitalized corporate interest allocated to the project. Total Estimated Development Costs for assets at Ward Village and Columbia exclude master plan infrastructure and amenity costs at Ward Village and Merriweather District. (b) We expect to be able to meet our cash funding requirements with a combination of existing and anticipated construction loans, condominium buyer deposits, free cash flow from our Operating Assets and MPC segments, net proceeds from condominium sales, our existing cash balances, and as necessary, the postponement of certain projects. (c) Remaining cost is related to lease-up and tenant build-out. (d) Negative balance relates to costs paid by HHH, but not yet reimbursed by our lenders. We expect to receive funds from our lenders for these costs in the future. (e) Wingspan, our first single-family rental community in Bridgeland, welcomed its first residents in October 2023. As of March 31, 2024, 63% of the property has been placed in service. The remaining 37% is expected to be placed in service in the second quarter of 2024. (f) Total estimated cost includes $158.4 million for warranty repairs. However, we anticipate recovering a substantial amount of these costs in the future, which is not reflected in this schedule. Summary of Remaining Development Costs
HOWARD HUGHES 24 MPC Regions Non-MPC Regions The Woodlands The Woodlands Hills Bridgeland Summerlin Teravalis Floreo (a) Total Columbia Hawai‘i Seaport Total As of March 31, 2024 Houston, TX Houston, TX Houston, TX Las Vegas, NV Phoenix, AZ Phoenix, AZ MPC Regions Columbia, MD Honolulu, HI New York, NY Non- MPC Stabilized Properties Office Sq.Ft. 3,969,487 — — 535,965 — — 4,505,452 1,753,291 — — 1,753,291 Retail Sq. Ft. (b) 318,503 — 67,947 803,145 — — 1,189,595 198,903 808,569 13,000 1,020,472 Multi-family units 2,298 — 670 391 — — 3,359 1,199 — 21 1,220 Other Sq. Ft. 135,801 — — — — — 135,801 — — — — Unstabilized Properties Office Sq.Ft. — — — 265,898 — — 265,898 — — 178,763 178,763 Retail Sq.Ft. — — — — — — — 32,607 48,170 293,729 374,506 Multi-family units — — 263 294 — — 557 472 — — 472 Under Construction Properties Office Sq.Ft. — — — 147,000 — — 147,000 86,000 — — 86,000 Retail Sq.Ft. — — 28,000 67,000 — — 95,000 — 58,900 — 58,900 Multi-family units 268 — — — — — 268 — — — — Condominiums Number of units 111 — — — — — 111 — 5,101 — 5,101 Units remaining to be sold through March 31, 2024 55 — — — — — 55 — 364 — 364 Residential Land Total gross acreage 28,545 ac 2,055 ac 11,506 ac 22,500 ac 33,810 ac 3,029 ac 101,445 ac 16,450 ac n/a n/a n/a Current Residents 123,000 2,700 23,000 127,000 — — 275,700 n/a n/a n/a n/a Remaining saleable acres 35 ac 690 ac 1,640 ac 2,462 ac 15,804 ac 809 ac 21,440 ac n/a 364 n/a n/a Estimated price per acre (c) $1,923 $346 $501 $1,309 $751 $779 n/a n/a n/a Commercial Land Total acreage remaining 716 ac 167 ac 1,052 ac 551 ac 10,531 ac 457 ac 13,474 ac 96 ac n/a n/a 96 ac Estimated price per acre (c) $950 $532 $752 $1,176 $206 $151 n/a n/a n/a Portfolio Key Metrics Portfolio Key Metrics include 100% of square footage, units, and acreage associated with joint venture projects. Retail space in multi-family assets shown as retail square feet. (a) This represents 100% of Floreo gross and remaining saleable acreage and 100% of the estimated price per acre expected to be achieved. The Company owns a 50% interest in Floreo and accounts for its investment under the equity method. (b) Retail Sq. Ft. within the Summerlin region excludes 381,767 Sq. Ft. of anchors and 39,700 Sq. Ft. of additional office space above our retail space. (c) Residential and commercial pricing represents the Company's estimate of price per acre (in thousands) per its 2024 land models. Portfolio Key Metrics
HOWARD HUGHES 25 Master Planned Community Land Consolidated MPC Segment EBT The Woodlands The Woodlands Hills Bridgeland Summerlin Teravalis Total Floreo (a) thousands Q1 2024 Q1 2023 Q1 2024 Q1 2023 Q1 2024 Q1 2023 Q1 2024 Q1 2023 Q1 2024 Q1 2023 Q1 2024 Q1 2023 Q1 2024 Q1 2023 Revenues: Residential land sale revenues $ — $ 10,101 $ 215 $ 2,111 $ 18,438 $ 12,206 $ 8,509 $ 7,185 $ — $ — $ 27,162 $ 31,603 $ 13,298 $ — Commercial land sale revenues 10 — 3 6 5,240 27,752 — — — — 5,253 27,758 — — Builder price participation 226 108 574 714 2,182 1,248 9,584 11,939 — — 12,566 14,009 — — Other land sale revenues 225 230 19 29 48 166 3,602 3,198 — 20 3,894 3,643 — — Total revenues 461 10,439 811 2,860 25,908 41,372 21,695 22,322 — 20 48,875 77,013 13,298 — Expenses: Cost of sales - residential land — (5,060) (82) (1,012) (7,597) (3,967) (3,427) (2,977) — — (11,106) (13,016) (9,481) — Cost of sales - commercial land (2) — (1) (2) (1,795) (8,985) — — — — (1,798) (8,987) — — Real estate taxes (1,356) (1,436) (23) (5) (1,481) (912) (476) (459) (3) (4) (3,339) (2,816) (36) (48) Land sales operations (1,652) (1,788) (554) (836) (2,180) (2,687) (4,164) (3,728) (256) (493) (8,806) (9,532) (1,022) (528) Total operating expenses (3,010) (8,284) (660) (1,855) (13,053) (16,551) (8,067) (7,164) (259) (497) (25,049) (34,351) (10,539) (576) Depreciation and amortization (30) (30) (2) (2) (31) (31) (37) (34) (10) (10) (110) (107) (30) (23) Interest income (expense), net 229 273 953 589 4,423 6,314 9,641 8,636 — — 15,246 15,812 (304) (353) Other (loss) income, net — (103) — — — — — — — — — (103) — — Equity in earnings (losses) from unconsolidated ventures (b) — — — — — — (15,923) 4,630 1,212 (522) (14,711) 4,108 — — MPC Segment EBT $ (2,350) $ 2,295 $ 1,102 $ 1,592 $ 17,247 $ 31,104 $ 7,309 $ 28,390 $ 943 $ (1,009) $ 24,251 $ 62,372 $ 2,425 $ (952) (a) This represents 100% of Floreo EBT. The Company owns a 50% interest in Floreo and accounts for its investment under the equity method. (b) Equity in earnings (losses) from unconsolidated ventures for Summerlin reflects our share of earnings in The Summit joint venture and for Teravalis our share of earnings in our Floreo joint venture. MPC Performance
HOWARD HUGHES 26 Master Planned Community Land Consolidated MPC Segment The Woodlands The Woodlands Hills Bridgeland Summerlin Teravalis Floreo (a) thousands, except acres Q1 2024 Q1 2023 Q1 2024 Q1 2023 Q1 2024 Q1 2023 Q1 2024 Q1 2023 Q1 2024 Q1 2023 Q1 2024 Q1 2023 Key Performance Metrics: Residential Total acres closed in current period — ac 3.5 ac 0.4 ac 4.9 ac 30.7 ac 22.5 ac — ac 0.7 ac — ac — ac 51.6 ac — ac Price per acre achieved $— $2,886 $538 $431 $601 $542 $— $2,857 $— $— $758 $— Avg. gross margins —% 49.9% 61.9% 52.1% 58.8% 67.5% —% 58.6% —% —% 28.7% —% Commercial Total acres closed in current period — ac — ac — ac — ac 3.5 ac 108.8 ac — ac — ac — ac — ac — ac — ac Price per acre achieved $— $— $— $— $801 $247 $— $— $— $— $— $— Avg. gross margins — % — % —% — % 58.8 % 67.6% — % —% —% —% —% —% Avg. combined before-tax net margins — % 49.9% 61.9% 52.1% 58.8 % 67.6% —% 58.6% —% —% 28.7% —% Key Valuation Metrics: Remaining saleable acres (b) Residential 35 ac 690 ac 1,640 ac 2,462 ac 15,804 ac 809 ac Commercial 716 ac 167 ac 1,052 ac 551 ac 10,531 ac 457 ac Projected est. % superpads / lot size —% / — ac —% / — ac —% / — ac 66% / 0.25 ac —% / — ac —% / — ac Projected est. % single-family detached lots / lot size 79% / 0.16 ac 81% / 0.21 ac 90% / 0.19 ac —% / — ac 81% / 0.22 ac 100% / 0.17 ac Projected est. % single-family attached lots / lot size 21% / 0.14 ac 19% / 0.12 ac 8% / 0.08 ac —% / — ac 19% / 0.11 ac —% / — ac Projected est. % custom homes / lot size —% / — ac —% / — ac 2% / 0.62 ac 34% / 1 ac —% / — ac —% / — ac Estimated builder sale velocity (c) NM 24 88 96 NM NM Projected GAAP gross margin (d) 76.0% 75.8% 62.1% 52.1% 58.8% 67.5% 64.1% 61.4% 38.0% 40.7% 28.7% 34.8% Projected cash gross margin (d) 96.7% 88.9% 78.2% 80.4% 39.3% 52.6% Residential sellout / Commercial buildout date estimate Residential 2026 2032 2035 2043 2086 2032 Commercial 2034 2033 2046 2039 2086 2035 (a) This represents 100% of Floreo metrics. The Company owns a 50% interest in Floreo and accounts for its investment under the equity method. (b) Saleable acres can fluctuate from period to period as a result of a master planning process. (c) Represents the average monthly builder homes sold over the last twelve months ended March 31, 2024. (d) Projected GAAP gross margin is based on expected GAAP MPC land sales revenues and MPC cost of sales. This measure includes all future projected revenues less all remaining historical development costs incurred to date and remaining future projected cash development costs. Projected cash gross margin represents the net cash margin expected to be received in the future and includes all future projected revenues less all remaining future projected cash development costs. The projected cash gross margin does not include remaining historical development costs incurred to date. Gross margin for each MPC may vary from period to period based on the locations of the land sold and the related costs associated with developing the land sold. NM Not meaningful. MPC Land
HOWARD HUGHES 27 Office Expirations (a) Retail Expirations (a) Expiration Year Annualized Cash Rent ($ in thousands) Percentage of Annualized Cash Rent Wtd. Avg. Annualized Cash Rent Per Leased Sq. Ft. Annualized Cash Rent ($ in thousands) Percentage of Annualized Cash Rent Wtd. Avg. Annualized Cash Rent Per Leased Sq. Ft. 2024 $ 11,176 4.18 % $ 39.40 $ 3,972 3.45 % $ 46.00 2025 14,289 5.34 % 42.97 20,409 17.69 % 51.39 2026 10,918 4.08 % 41.86 10,689 9.27 % 41.56 2027 31,594 11.80 % 41.92 6,993 6.07 % 41.89 2028 17,335 6.47 % 45.69 9,261 8.03 % 53.49 2029 30,235 11.29 % 47.50 8,723 7.57 % 55.11 2030 26,143 9.76 % 49.14 6,651 5.77 % 64.83 2031 16,002 5.98 % 53.65 5,255 4.56 % 56.79 2032 56,811 21.21 % 53.14 5,395 4.68 % 56.35 2033 15,331 5.73 % 41.89 16,013 13.88 % 66.84 Thereafter 38,103 14.16 % 52.57 22,017 19.03 % 40.80 Total $ 267,937 100.00 % $ 115,378 100.00 % (a) Excludes leases with an initial term of 12 months or less. Also excludes Seaport leases. Office and Retail Lease Expirations Total Office and Retail Portfolio as of March 31, 2024 % o f A nn ua liz ed C as h R en t E xp iri ng Houston Summerlin Columbia Hawaii Other Office 2024 Retail 2024 Office 2025 Retail 2025 Office 2026 Retail 2026 Office 2027 Retail 2027 Office 2028 Retail 2028 Office 2029 Retail 2029 Office 2030 Retail 2030 Office 2031 Retail 2031 Office 2032 Retail 2032 Office 2033 Retail 2033 Office 2034+ Retail 2034+ 0% 6% 12% 18% 24% 30% Lease Expirations
HOWARD HUGHES 28 Other Assets Property Name Location % Ownership Acres Notes West End Alexandria Alexandria, VA 58% 41 West End Alexandria is a joint venture formed to redevelop the former Landmark Mall into four million square feet of residential, retail, commercial, and entertainment offerings with a central plaza and a network of parks and public transportation. The development will be anchored by a new state-of-the-art hospital and medical campus. Demolition began in the second quarter of 2022 and was completed in 2023, with completion of infrastructure work expected in 2025. 80% Interest in Fashion Show Air Rights Las Vegas, NV 80% N/A The air rights above the Fashion Show Mall located on the Las Vegas Strip will be included in the planned Seaport Entertainment spinoff. 250 Water Street New York, NY 100% 1 This full-block surface parking lot at the entrance of the Seaport will be included in the planned Seaport Entertainment spinoff. Other Assets Acquisition / Disposition Activity Q1 2024 Dispositions Date Sold Property % Ownership Location Acres / Rentable Sq. Ft. Sale Price February, 2024 Creekside Park Medical Plaza 100% Houston, TX 32,689 sq. ft. $14.0 million Acquisition / Disposition Activity
HOWARD HUGHES 29 thousands March 31, 2024 December 31, 2023 Fixed-rate debt Unsecured 5.375% Senior Notes due 2028 $ 750,000 $ 750,000 Unsecured 4.125% Senior Notes due 2029 650,000 650,000 Unsecured 4.375% Senior Notes due 2031 650,000 650,000 Secured mortgages payable 1,482,958 1,485,494 Special Improvement District bonds 64,928 65,627 Variable-rate debt Secured mortgages payable, excluding condominium financing 987,654 969,085 Condominium financing 377,395 307,404 Secured Bridgeland Notes due 2026 475,000 475,000 Mortgages, notes and loans payable 5,437,935 5,352,610 Deferred financing costs (46,692) (49,990) Mortgages, notes, and loans payable, net $ 5,391,243 $ 5,302,620 Net Debt on a Segment Basis as of March 31, 2024 (a) thousands Operating Assets Master Planned Communities Seaport Strategic Developments Segment Totals Non- Segment Amounts Total Mortgages, notes, and loans payable, net $ 2,329,858 $ 535,637 $ 113,187 $ 381,681 $ 3,360,363 $ 2,030,880 $ 5,391,243 Mortgages, notes, and loans payable of unconsolidated ventures (b) 90,587 53,511 68 — 144,166 — 144,166 Less: Cash and cash equivalents (14,904) (114,494) (2,034) (20,541) (151,973) (310,727) (462,700) Cash and cash equivalents of unconsolidated ventures (b) (1,591) (13,225) (10,473) (4,023) (29,312) — (29,312) Special Improvement District receivables — (75,447) — — (75,447) — (75,447) Municipal Utility District receivables, net — (581,255) — (2,967) (584,222) — (584,222) TIF receivable — — — (3,807) (3,807) — (3,807) Net Debt $ 2,403,950 $ (195,273) $ 100,748 $ 350,343 $ 2,659,768 $ 1,720,153 $ 4,379,921 Consolidated Debt Maturities and Contractual Obligations as of March 31, 2024 thousands Remaining in 2024 2025 2026 2027 2028 Thereafter Total Mortgages, notes, and loans payable (c) $ 257,027 $ 547,809 $ 988,528 $ 302,229 $ 835,522 $ 2,506,820 $ 5,437,935 Interest payments (d) 230,416 264,470 209,688 157,034 131,845 279,899 1,273,352 Ground lease commitments (e) 1,944 2,937 2,992 3,049 3,108 240,242 254,272 Total $ 489,387 $ 815,216 $ 1,201,208 $ 462,312 $ 970,475 $ 3,026,961 $ 6,965,559 Debt Summary (a) Net debt is a non-GAAP financial measure that we believe is useful to our investors and other users of our financial statements as its components are important indicators of our overall liquidity, capital structure, and financial position. However, it should not be used as an alternative to our debt calculated in accordance with GAAP. (b) Each segment includes our share of the Mortgages, notes, and loans payable, net and Cash and cash equivalents for all joint ventures included in Investments in unconsolidated ventures. (c) We expect $246.0 million due in 2024 to be repaid with condo closings. (d) Interest is based on the borrowings that are presently outstanding and current floating interest rates without the effects of interest rate derivatives. (e) Primarily relates to Seaport ground lease with initial expiration in 2072 and extension options through 2120. Future cash payments are not inclusive of extension options. Debt Summary
HOWARD HUGHES 30 (a) Includes the impact of interest rate derivatives. (b) Does not include extension options, some of which have performance requirements. (c) Represents Secured Bridgeland Notes. (d) Represents 250 Water Street mortgage. (e) Excludes the Company's share of debt related to its unconsolidated ventures, which totaled $144.2 million as of March 31, 2024. thousands Q1 2024 Principal Range of Interest Rates (a) Weighted- average Interest Rate (a) Weighted- average Years to Maturity (b) Operating Assets Office $ 1,183,180 3.43 % 9.38 % 5.64 % 4.8 Retail 260,113 3.50 % 8.32 % 6.00 % 4.8 Multi-family 836,678 3.13 % 8.37 % 5.06 % 5.3 Other 67,612 3.65 % 8.18 % 5.19 % 12.1 Total Operating Assets $ 2,347,583 3.13 % 9.38 % 5.46 % 5.2 Master Planned Communities (c) $ 475,000 7.62 % 7.62 % 7.62 % 2.4 Seaport (d) $ 115,000 9.20 % 9.20 % 9.20 % 2.4 Strategic Developments Condominiums $ 377,395 7.50 % 10.41 % 9.66 % 0.9 Office 8,028 7.62 % 8.67 % 8.22 % 17.0 Multi-family 1 7.39 % 8.06 % 7.39 % 6.4 Total Strategic Developments $ 385,424 7.39 % 10.41 % 9.63 % 1.2 Bonds Corporate Bonds $ 2,050,000 4.13 % 5.38 % 4.66 % 5.3 SID Bonds 64,928 4.13 % 7.00 % 5.22 % 25.7 Total Bonds $ 2,114,928 4.13 % 7.00 % 4.68 % 5.9 Total (e) $ 5,437,935 3.13 % 10.41 % 5.72 % 4.9 Debt Summary (cont.)
HOWARD HUGHES 31 Reconciliation of Operating Assets segment EBT to Total NOI thousands Q1 2024 Q4 2023 Q3 2023 Q2 2023 Q1 2023 Total revenues $ 110,152 $ 104,406 $ 116,874 $ 121,427 $ 100,925 Total operating expenses (51,395) (52,329) (55,786) (54,452) (47,599) Segment operating income (loss) 58,757 52,077 61,088 66,975 53,326 Depreciation and amortization (44,156) (47,094) (43,127) (40,878) (39,632) Interest income (expense), net (33,476) (36,308) (31,884) (30,285) (28,911) Other income (loss), net 408 (155) (244) (40) 2,282 Equity in earnings (losses) from unconsolidated ventures 5,817 (2,342) 1,364 2,042 1,905 Gain (loss) on sale or disposal of real estate and other assets, net 4,794 3,162 16,050 (16) 4,730 Gain (loss) on extinguishment of debt — (96) — — — Operating Assets segment EBT (7,856) (30,756) 3,247 (2,202) (6,300) Add back: Depreciation and amortization 44,156 47,094 43,127 40,878 39,632 Interest (income) expense, net 33,476 36,308 31,884 30,285 28,911 Equity in (earnings) losses from unconsolidated ventures (5,817) 2,342 (1,364) (2,042) (1,905) (Gain) loss on sale or disposal of real estate and other assets, net (4,794) (3,162) (16,050) 16 (4,730) (Gain) loss on extinguishment of debt — 96 — — — Impact of straight-line rent (847) 408 (470) (1,081) (1,113) Other (54) 167 336 269 (185) Operating Assets NOI 58,264 52,497 60,710 66,123 54,310 Company's share of NOI from equity investments 1,980 1,837 2,121 1,960 1,827 Distributions from Summerlin Hospital investment 3,242 — — — 3,033 Company's share of NOI from unconsolidated ventures 5,222 1,837 2,121 1,960 4,860 Total Operating Assets NOI $ 63,486 $ 54,334 $ 62,831 $ 68,083 $ 59,170 Reconciliation of Non-GAAP Measures
HOWARD HUGHES 32 Reconciliation of Non-GAAP Measures Reconciliation of Seaport segment EBT to Total NOI thousands Q1 2024 Q4 2023 Q3 2023 Q2 2023 Q1 2023 Total revenues $ 11,502 $ 17,780 $ 29,490 $ 22,804 $ 11,897 Total operating expenses (21,485) (24,582) (33,303) (26,665) (18,916) Segment operating income (loss) (9,983) (6,802) (3,813) (3,861) (7,019) Depreciation and amortization (5,757) (5,987) (10,808) (10,469) (10,527) Interest income (expense), net (2,012) (790) 1,358 1,311 1,186 Other income (loss), net — (3) 313 (1,601) 1 Equity in earnings (losses) from unconsolidated ventures (10,280) (13,150) (46,619) (10,896) (10,820) Gain (loss) on extinguishment of debt — — (48) — — Provision for impairment — — (672,492) — — Seaport segment EBT (28,032) (26,732) (732,109) (25,516) (27,179) Add back: Depreciation and amortization 5,757 5,987 10,808 10,469 10,527 Interest (income) expense, net 2,012 790 (1,358) (1,311) (1,186) Equity in (earnings) losses from unconsolidated ventures (a) 10,280 13,150 46,619 10,896 10,820 (Gain) loss on extinguishment of debt — — 48 — — Impact of straight-line rent 502 360 435 546 586 Other (income) loss, net (b) 876 (139) 2,163 2,470 847 Provision for impairment (a) — — 672,492 — — Seaport NOI (8,605) (6,584) (902) (2,446) (5,585) Company's share of NOI from unconsolidated ventures (c) (8,902) (11,617) (8,603) (9,262) (9,591) Total Seaport NOI $ (17,507) $ (18,201) $ (9,505) $ (11,708) $ (15,176) (a) During the third quarter of 2023, HHH recorded a $709.5 million pre-tax impairment charge related to the Seaport, comprised of $672.5 million recognized in Provision for impairment and $37.0 million recognized in equity losses from unconsolidated ventures. The Seaport assets were impaired due to reductions in estimated future cash flows resulting from significant uncertainty of future performance as stabilization and profitability are taking longer than expected, pressure on the current cost structure, lower demand for office space, as well as an increase in the capitalization rate and a decrease in restaurant multiples used to evaluate future cash flows. (b) Includes miscellaneous development-related items. (c) The Company’s share of NOI related to the Tin Building by Jean-Georges and the Lawn Club is calculated using our current partnership funding provisions.
HOWARD HUGHES 33 RECONCILIATIONS OF NET INCOME TO FFO thousands except share amounts Q1 2024 Q1 2023 Net income attributable to common shareholders $ (52,477) $ (22,745) Adjustments to arrive at FFO: Segment real estate related depreciation and amortization 51,442 51,209 (Gain) loss on sale or disposal of real estate and other assets, net (4,794) (4,730) Income tax expense adjustments: Gain on sale or disposal of real estate and other assets, net 1,191 1,041 Reconciling items related to noncontrolling interests 10 118 Company's share of the above reconciling items from unconsolidated joint ventures 1,752 746 FFO $ (2,876) $ 25,639 Adjustments to arrive at Core FFO: Severance expenses 771 1,596 Non-real estate related depreciation and amortization 805 800 Straight-line amortization (343) (527) Deferred income tax expense (benefit) (19,104) (1,885) Non-cash fair value adjustments related to hedging instruments (1,205) (2,679) Share-based compensation 3,181 4,771 Other non-recurring expenses 13,008 3,571 Company's share of the above reconciling items from unconsolidated joint ventures 20 1 Core FFO $ (5,743) $ 31,287 Adjustments to arrive at AFFO: Tenant and capital improvements (7,230) (5,282) Leasing commissions (1,331) (636) AFFO $ (14,304) $ 25,369 FFO per diluted share value $ (0.06) $ 0.52 Core FFO per diluted share value $ (0.12) $ 0.63 AFFO per diluted share value $ (0.29) $ 0.51 Reconciliations of Net Income to FFO, Core FFO and AFFO