Howard Hughes Holdings Inc. Reports Fourth Quarter and Full Year 2024 Results

Strong fourth quarter performance leads to record financial results across all segments-- MPC and Operating Assets momentum expected to continue into 2025

THE WOODLANDS, Texas, Feb. 26, 2025 (GLOBE NEWSWIRE) -- Howard Hughes Holdings Inc. $(HHH)$ (the "Company," "HHH," or "we") today announced operating results for the fourth quarter and year ended December 31, 2024. The financial statements, exhibits, and reconciliations of non-GAAP measures in the attached Appendix and the Supplemental Information, as available through the Investors section of our website, provide further detail of these results.

Full Year 2024 Highlights:

   -- Net income from continuing operations per diluted share of $5.73, up 
      $4.05 per share or 241% year-over-year 
 
   -- Record Master Planned Community $(MPC)$ Earnings Before Taxes (EBT) of 
      $349 million accentuated by all-time high residential land sales revenues 
      and average price per acre 
 
   -- Record Total Operating Assets Net Operating Income (NOI) of $257 million 
      led by strong leasing performance resulting in year-over-year increases 
      of 11% in multifamily and 5% in office 
 
   -- Record condominium revenues of $779 million with the delivery of Victoria 
      Place$(R)$ and strong pre-sales of 394 condominiums from other towers in 
      Hawai'i and Texas representing future revenues of $870 million 
 
   -- Closed on $862 million of financings, including $680 million of 
      construction loans for condo projects and $168 million of 
      refinancings--as well as the accelerated collection of $177 million from 
      the sale of existing and future MUD receivables 
 
   -- Completed the spinoff of Seaport Entertainment Group on July 31, 2024, 
      providing increased focus on HHH's real estate operations and MPC 
      development 

Fourth Quarter 2024 Highlights:

   -- Net income from continuing operations per diluted share of $3.25 in the 
      quarter, up 207% compared to $1.06 in the prior-year period 
 
   -- Delivered Victoria Place in Ward Village, generating $212 million of 
      gross profit 
 
   -- MPC EBT of $57 million driven by the sale of 60 residential acres at an 
      average price of $909,000 per acre, including six custom lots in 
      Summerlin(R) at an average price of $6.0 million per acre 
 
   -- Total Operating Assets NOI of $61 million was up 9% year-over-year with 
      growth in retail, multifamily, and office 
 
   -- Sold Lakeland Village Center at Bridgeland for $28 million generating an 
      $11 million gain on sale 
 
   -- Closed on $312 million of financings, including a $260 million 
      construction loan for The Ritz-Carlton Residences, The Woodlands 

"Howard Hughes delivered another exceptional year in 2024, led by record-setting financial results in each of our business segments," commented David R. O'Reilly, Chief Executive Officer of Howard Hughes. "Our outstanding performance was complemented by the successful streamlining and refocusing of our business--most notably with the spinoff of Seaport Entertainment--and the strengthening of our balance sheet through key financings and innovative transactions which firmly place the Company in a position of financial strength for the future.

"In our MPC segment, we closed out the year on a strong note, delivering $57 million of EBT in the fourth quarter, including robust land sales to homebuilders in Texas and the sale of six custom lots in Summerlin at an impressive average price of $6 million per acre. With this solid performance, we achieved key milestones in our residential land business--including new full-year records for price per acre and land sales revenues--helping propel MPC EBT to an all-time high of $349 million. Looking ahead, we anticipate continued strong homebuilder demand which is expected to contribute to incremental land sales growth and record MPC EBT in 2025.

"In Operating Assets, we delivered record NOI for a fourth consecutive year, increasing NOI by 6% compared to 2023. Growth was realized in each of our core property types, with the most significant percentage gain in multifamily which benefited from strong leasing momentum at our newest developments and improved overall leasing at our stabilized properties. In office, our successful leasing strategy in recent years started to pay dividends in 2024 as rent abatements began to expire across the portfolio. With another 473,000 square feet leased during the year, we closed out 2024 with our stabilized office portfolio 89% leased, well positioning us to deliver continued growth in the years ahead.

"In Strategic Developments, we had another remarkable year which culminated in the fourth quarter with the delivery and record sell-out of every condominium at Victoria Place in Ward Village. In addition to this milestone, our sales teams pre-sold nearly 400 additional condominiums in Hawai'i and Texas during the year, bringing the total value of future condo sales which will be recognized in the next few years to more than $2.6 billion. Subsequent to year end, the State of Hawai'i amended rules which we estimate will provide the potential for an additional 2.5 to 3.5 million gross square feet of residential entitlements in Ward Village. These entitlements could be used for the construction of additional residential towers in the undeveloped areas of the community, providing much needed additional housing in O'ahu and further enhancing the exceptional quality of life and vibrancy of the neighborhood.

"We closed out 2024 on a solid financial foundation with over $900 million of liquidity, including nearly $600 million of cash on the balance sheet and over $300 million of undrawn and fully available commitments. In 2025, we anticipate another strong year with mid-point guidance in both our MPC and Operating Assets segments that imply new full-year records. This is expected to yield approximately $350 million of Adjusted Operating Cash Flow--our new guidance metric which provides enhanced visibility into the key drivers of our cash flow generation and self-funding business model. We are also evaluating additional MUD receivable sales which, if completed, would add substantial additional liquidity to the Company. As always, we remain committed to deploying capital in a disciplined manner, seeking growth opportunities that improve our communities and achieve the highest risk-adjusted returns for our shareholders."

Click Here: Fourth Quarter 2024 Howard Hughes Quarterly Spotlight Video

Click Here: Fourth Quarter 2024 Earnings Call Webcast

Financial Highlights

Total Company

Full Year

   -- HHH reported net income from continuing operations of $285.2 million, or 
      $5.73 per diluted share in 2024, compared to $83.4 million, or $1.68 per 
      diluted share in 2023. The year-over-year growth was primarily driven by 
      the delivery of Victoria Place in Ward Village, increased MPC residential 
      land sales, improved Operating Asset NOI, and final settlement of the 
      construction defect dispute at Waiea in Ward Village. 
 
   -- The Company continued to maintain a strong liquidity position with $596.1 
      million of cash and cash equivalents, $1.2 billion of undrawn lender 
      commitments available to be drawn for property development, and limited 
      near-term debt maturities. 
 
   -- On July 31, 2024, HHH completed the spinoff of Seaport Entertainment 
      Group Inc. $(SEG)$, with holders of HHH common stock receiving one share of 
      SEG common stock for every nine shares of HHH common stock. All current 
      and historical net income and losses related to SEG are reflected in 
      discontinued operations in the Company's financial statements. 

Fourth Quarter

   -- Net income from continuing operations was $162.3 million, or $3.25 per 
      diluted share in the quarter, compared to net income of $52.8 million, or 
      $1.06 per diluted share in the prior-year period. 
 
   -- The year-over-year increase was primarily related to the delivery of 
      Victoria Place in Ward Village, partially offset by reduced MPC land 
      sales due to timing of superpad sales in Summerlin which occurred earlier 
      in 2024. 

MPC

Full Year

   -- MPC EBT totaled a record $349.1 million, representing a 2% increase 
      compared to $341.4 million in the prior year. 
 
   -- Record MPC land sales of $453.2 million increased 22% year-over-year, 
      driven by the sale of 445 residential acres at a record average price of 
      $990,000 per acre. 
 
   -- In Teravalis$(TM)$, residential land sales commenced in Floreo with the 
      sale of 115 acres to seven homebuilders at an impressive average price of 
      $777,000 per acre. During the year, HHH recognized $4.9 million of equity 
      earnings from Floreo. 
 
   -- New homes sold at a robust pace in HHH's communities during 2024 and 
      totaled 2,234 units, with Summerlin and Bridgeland ranking #5 and #7 in 
      RCLCO's annual list of top-selling master planned communities, 
      respectively. 

Fourth Quarter

   -- MPC EBT totaled $56.9 million in the fourth quarter, down from 
      $139.3 million in the prior-year period. The reduction was primarily due 
      to the timing of superpad sales in Summerlin which occurred earlier in 
      the year and contributed to record MPC residential land sales and EBT in 
      2024. 
 
   -- MPC land sales totaled $67.8 million and were driven by the sale of 60 
      acres of residential land across Bridgeland(R), The Woodlands Hills(R), 
      and Summerlin for an average price of $909,000 per acre. 
 
   -- In Nevada, custom lot sales commenced in Astra--Summerlin's newest luxury 
      gated community--resulting in the sale of six lots totaling 3.8 acres for 
      an average price of $6.0 million per acre. 
 
   -- In Arizona, 34 acres were sold in HHH's Floreo joint venture for an 
      average price of $767,000 per acre. 

Operating Assets

Full Year

   -- Total Operating Assets NOI, including the contribution from 
      unconsolidated ventures, was $257.0 million--a new full-year record 
      representing a $15.7 million or 6% year-over-year increase. 
 
   -- Office delivered record NOI in 2024, increasing $6.4 million or 5% 
      year-over-year largely due to strong lease-up activity and abatement 
      expirations in The Woodlands(R) and Summerlin. These increases were 
      partially offset by some tenant vacancies in The Woodlands and Downtown 
      Columbia(R), as well as initial operating losses at Meridian in 
      Summerlin. In 2024, the Company executed 473,000 square feet of new or 
      expanded office leases including 323,000 square feet in The Woodlands, 
      91,000 square feet in Downtown Columbia, and 59,000 square feet in 
      Summerlin. 
 
   -- Multifamily contributed record NOI and increased 11% year-over-year, 
      predominantly due to strong lease-up at new developments in Downtown 
      Columbia, Summerlin, and Bridgeland, as well as improved overall leasing 
      at HHH's stabilized properties. 
 
   -- Retail NOI was up 8% primarily due to the collection of prior-year 
      reserves for tenants in Ward Village and improved occupancy in the ground 
      floor retail at Juniper and Marlow in Downtown Columbia and K 'ula(R) in 
      Ward Village. 
 
   -- During the year, HHH divested Creekside Medical Plaza in The Woodlands, 
      Lakeland Village Center at Bridgeland, and four non-core ground leases in 
      Houston which resulted in a combined gain on sale of $22.9 million. 

Fourth Quarter

   -- Total Operating Assets NOI--including the contribution from 
      unconsolidated ventures--totaled $61.2 million in the quarter, 
      representing an 9% year-over-year increase. 
 
   -- Office NOI of $29.0 million increased 5% year-over-year, driven primarily 
      by rent abatement expirations and increased occupancy at 9950 Woodloch 
      Forest in The Woodlands and 1700 Pavilion in Summerlin, partially offset 
      by lower occupancy at 1725 Hughes Landing in The Woodlands. At quarter 
      end, the stabilized office portfolio was 89% leased, and 129,000 square 
      feet of new or expanded leases were executed during the quarter. 
 
   -- Multifamily NOI of $15.0 million increased 13% compared to the prior-year 
      period primarily due to the continued lease-up of HHH's newest properties 
      including Tanager Echo in Summerlin, Wingspan in Bridgeland, and Marlow 
      in Downtown Columbia. At year end, the stabilized portfolio was 96% 
      leased. 
 
   -- Retail NOI of $13.0 million increased 15% year-over-year primarily due to 
      non-recurring prior-year reserves for various tenants in Ward Village and 
      the opening of the ground floor retail at K 'ula. At quarter end, the 
      retail portfolio was 96% leased. 
 
   -- The Company sold Lakeland Village Center at Bridgeland for $28.0 million 
      and two non-core ground leases in Houston, resulting in a combined gain 
      on sale of $14.9 million. 

Strategic Developments

Full Year

   -- Delivered Victoria Place in the fourth quarter, closing on the sale of 
      all 349 condo units and generating record annual condominium revenues of 
      $778.6 million with adjusted gross profit of $211.1 million. 
 
   -- In Hawai'i, HHH contracted to sell 316 condominium units at three towers 
      in pre-sales--The Park Ward Village(R), Kalae(R), and The 
      Launiu--representing incremental future revenue of $533.4 million. The 
      majority of these pre-sales occurred at The Launiu, which contracted 283 
      units during the year. At year end, The Park Ward Village was 97% 
      pre-sold, Kalae was 93% pre-sold, and The Launiu was 58% pre-sold. 
 
   -- In Texas, pre-sales at The Ritz Carlton Residences, The Woodlands--a new 
      111-unit luxury condominium development on the shores of Lake 
      Woodlands--commenced in March. Construction began in early October and 
      70% of its units representing $336.9 million of future revenue are 
      already pre-sold. 
 
   -- In the third quarter, the Company recovered $90.0 million of insurance 
      proceeds related to the settlement of construction defect claims at Waiea 
      in Ward Village--including window remediation expenditures incurred since 
      2020. During the year, the Company recognized $15.1 million of additional 
      condominium rights and unit cost of sales in conjunction with this 
      project and to settle final costs previously incurred by the Waiea 
      general contractor. 

Fourth Quarter

   -- Closed on the sale of all 349 condo units at Victoria Place, generating 
      $778.4 million of condominium revenues with a 27% gross margin. 
 
   -- Contracted to sell 19 condominium units in Hawai'i and Texas representing 
      $40.7 million of future revenue, including 15 units at The Launiu, two at 
      The Park Ward Village, one at Kalae, and one at The Ritz-Carlton 
      Residences, The Woodlands. 
 
   -- Subsequent to year end in January, the Governor of Hawai'i approved 
      amendments to the HCDA Mauka Area Rules to include updated guidelines for 
      smart growth in areas including Ward Village. The Company estimates this 
      amendment increases its potential residential entitlements in Ward 
      Village to between 2.5 to 3.5 million gross square feet, which could be 
      used for the development of additional condominium towers in future 
      years. 
 
   -- Completed construction on Village Green at Bridgeland Central and the 
      Summerlin Grocery Center anchored by Whole Foods. At quarter end, both of 
      these retail centers were approximately 75% leased with all of the 
      remaining square footage in LOI or lease negotiations. 

Financing Activity

Fourth Quarter

   -- Closed on a $260 million three-year construction loan for The 
      Ritz-Carlton Residences, The Woodlands. The loan bears interest at SOFR 
      plus 5.1%. 
 
   -- Closed on a $38.0 million loan to refinance the construction loan for 
      Starling at Bridgeland. The five-year non-recourse loan bears interest at 
      a fixed rate of 5.35%. 
 
   -- Closed on a $13.5 million financing for Waterway Plaza II, which was 
      purchased in an all-cash transaction for $19.2 million in the second 
      quarter of 2024. The loan bears interest at SOFR plus 3.5% and matures in 
      2029. 
 
   -- Increased the capacity of the Bridgeland Notes from $475.0 million to 
      $600.0 million and extended the maturity date from September 2026 to 
      September 2029. This transaction was supported by the proceeds from the 
      Bridgeland MUD receivables sale in the third quarter which were used to 
      pay down the notes by $192.0 million. 

Full Year 2025 Guidance

   -- MPC EBT is projected to be strong in 2025 and aided by continued tight 
      supply of existing homes on the market and low inventories of vacant 
      developed lots in our MPCs. As a result, we anticipate solid new home 
      sales in Summerlin, Bridgeland, and The Woodlands Hills and continued 
      strong homebuilder demand for residential land throughout 2025. 
      Residential land sales are expected to occur throughout the year, but the 
      second and third quarters will likely see a higher concentration of 
      superpad sales in Summerlin. Overall, 2025 MPC EBT is expected to be up 
      5% to 10% year-over-year with a mid-point of approximately $375 million. 
 
   -- Operating Assets NOI, including the contribution from unconsolidated 
      ventures, is projected to benefit from continued growth in multifamily 
      driven by increased occupancy at new multifamily developments. Office is 
      also expected to improve year-over-year due to strong leasing momentum 
      and expiring rent abatements across the portfolio. This improvement will 
      likely be partially offset by lower occupancy at various properties in 
      Downtown Columbia, some tenant turnover in The Woodlands, and initial 
      operating losses from our newest office developments. Retail is expected 
      to see a modest reduction in NOI during 2025, primarily due to 
      non-recurring collections of tenant reserves in Ward Village during 2024 
      and the impact of some turnover resulting from tenant upgrades in 
      Downtown Summerlin as this property reaches its 10-year anniversary. 
      Overall, 2025 Operating Assets NOI is expected to be flat to up 4% 
      year-over-year with a mid-point of approximately $262 million. 
 
   -- Condo sales revenues are projected to be approximately $375 million in 
      2025 and driven entirely by the closing of units at Ulana--a 696-unit 
      development in Ward Village which is 100% pre-sold and expected to be 
      completed in the fourth quarter. Because Ulana is a workforce housing 
      tower, the Company does not expect to recognize any gross profit from the 
      project. The Park Ward Village--HHH's next condo tower which comprises 
      545 market rate units--is already 97% pre-sold and expected to contribute 
      meaningful revenues and gross profit in 2026. 
 
   -- Cash G&A is projected to range between $76 million and $86 million in 
      2025--or a mid-point of $81 million--excluding approximately $9 million 
      of anticipated non-cash stock compensation. 
 
   -- Overall, Adjusted Operating Cash Flow is projected to range between 
      $325 million and $375 million in 2025 with a mid-point of approximately 
      $350 million or $7.00 per share. 
 
   -- With a disciplined approach to capital allocation throughout the year, 
      the Company expects to end 2025 with cash and cash equivalents of 
      approximately $600 million. This does not include the benefit of any MUD 
      receivable sales that could occur during the year. 

Conference Call & Webcast Information

Howard Hughes Holdings Inc. will host its fourth quarter 2024 earnings conference call on Thursday, February 27, 2025, 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 webpage. 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.

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 December 31,                 Year Ended December 31, 
                    ------------------------------------------  ------------------------------------------ 
$ in thousands        2024      2023     $ Change    % Change     2024      2023     $ Change    % Change 
------------------   -------   -------   ---------  ----------   -------   -------   ---------  ---------- 
Operating Assets 
NOI (1) 
   Office           $ 28,993  $ 27,504   $  1,489       5%      $124,594  $118,165   $  6,429        5% 
   Retail             13,027    11,301      1,726      15%        54,163    49,981      4,182        8% 
   Multifamily        15,000    13,319      1,681      13%        58,827    52,831      5,996       11% 
   Other               1,459     2,035       (576)   (28)%         6,153     7,411     (1,258)    (17)% 
   Redevelopments 
    (a)                   --      (107)       107     100%            --      (189)       189      100% 
   Dispositions 
    (a)                  432       299        133      44%         1,718     2,363       (645)    (27)% 
------------------   -------   -------    -------   -----        -------   -------    -------   ------ 
Operating Assets 
 NOI                  58,911    54,351      4,560       8%       245,455   230,562     14,893        6% 
   Company's share 
    of NOI from 
    unconsolidated 
    ventures           2,288     1,837        451      25%        11,552    10,778        774        7% 
------------------   -------   -------    -------   -----        -------   -------    -------   ------ 
Total Operating 
 Assets NOI         $ 61,199  $ 56,188   $  5,011       9%      $257,007  $241,340   $ 15,667        6% 
 
Projected 
 stabilized NOI 
 Operating Assets 
 ($ in millions)    $  352.2  $  349.8   $    2.4       1% 
 
MPC 
Acres Sold - 
 Residential              60       207       (147)   (71)%           445       375         70       19% 
Acres Sold - 
 Commercial               10         9          1      11%            14       132       (118)    (90)% 
Price Per Acre - 
 Residential        $    909  $  1,047   $   (138)   (13)%      $    990  $    944   $     46        5% 
Price Per Acre - 
 Commercial         $    218  $    480   $   (262)   (55)%      $    369  $    273   $     96       35% 
MPC EBT             $ 56,890  $139,323   $(82,433)   (59)%      $349,134  $341,419   $  7,715        2% 
 
Strategic 
Developments 
Condominium rights 
 and unit sales     $778,590  $    792   $777,798           NM  $778,616  $ 47,707   $730,909           NM 
------------------   -------   -------    -------   ----------   -------   -------    -------   ---------- 
 
 
(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. 
 
 

About Howard Hughes Holdings Inc.(R)

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: Downtown Columbia(R) in Maryland; The Woodlands(R) , Bridgeland(R) and The Woodlands Hills(R) in the Greater Houston, Texas area; Summerlin(R) in Las Vegas; Ward Village(R) in Honolulu, Hawai i; and Teravalis(TM) 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. We claim the protection of the Safe Harbor contained in the Private Securities Litigation Reform Act of 1995 for forward-looking statements (however we acknowledge that in the event that a transaction contemplated by the unsolicited proposals by Pershing Square Capital Management LP (Pershing Square) to acquire additional shares of our common stock (collectively, the Pershing Square Proposals) take the form of a tender offer, Safe Harbor protections would not apply to statements made in connection to the Pershing Square Proposals). Forward-looking 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) macroeconomic conditions such as volatility in capital markets, and a prolonged recession in the national economy, including any adverse business or economic conditions in the homebuilding, condominium-development, retail, and office sectors; (ii) our inability to obtain operating and development capital for our properties, including our inability to obtain or refinance debt capital from lenders and the capital markets; (iii) the inability of major tenants to continue paying their rent obligations due to bankruptcy, insolvency or a general downturn in their business; (iv) the availability of debt and equity capital; (v) interest rate volatility and inflation; (vi) ability to compete effectively, including the potential impact of heightened competition for tenants and potential decreases in occupancy at our properties; (vii) our ability to realize the anticipated benefits of the spinoff of Seaport Entertainment Group Inc. that we completed in 2024; (viii) the effects of the completion of the spinoff on our ongoing business; (ix) the effects of the Pershing Square Proposal, and our response thereto, upon our business and personnel; (x) our inability to obtain operating and development capital for our properties, including our inability to obtain or refinance debt capital from lenders and the capital markets; (xi) our ability to successfully identify, acquire, develop and/or manage properties on favorable terms and in accordance with applicable zoning and permitting laws; (xii) changes in governmental laws and regulations; (xiii) 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, including increases in interest rates; (xiv) mismatch of supply and demand, including interruptions of supply lines; (xv) lack of control over certain of the Company's properties due to the joint ownership of such property; (xvi) impairment charges; (xvii) the effects of catastrophic events or geopolitical conditions, such as international armed conflict, or the occurrence of epidemics or pandemics; (xiii) the effects of extreme weather conditions or climate change, including natural disasters, that may cause property damage or interrupt business; (xviii) the impact of water and electricity shortages; (xix) contamination of our property by hazardous or toxic substances; (xx) terrorist activity, acts of violence, or breaches of our or our vendors' data security; (xvii) losses that are not insured or exceed the applicable insurance limits (xxi) our ability to lease new or redeveloped space; (xxii) our ability to obtain the necessary governmental permits for the development of our properties and necessary regulatory approvals pursuant to an extensive entitlement process involving multiple and overlapping regulatory jurisdictions, which often require discretionary action by local

governments; (xxiii) increased construction costs exceeding our original estimates, delays or overruns, claims for construction defects, or other factors affecting our ability to develop, redevelop or construct our properties; (xiv) regulation of the portion of our business that is dedicated to the formation and sale of condominiums, including regulatory filings to state agencies, additional entitlement processes, and requirements to transfer control to a condominium association's board of directors in certain situations, as well as potential defaults by purchasers on their obligations to purchase condominiums; (xv) fluctuations in regional and local economies, the impact of changes in interest rates on residential housing and condominium markets, local real estate conditions, tenant rental rates, and competition from competing retail properties and the internet; (xvi) the inherent risks related to disruption of information technology networks and related systems, including cyber security attacks; and (xvii) the ability to attract and retain key personnel. 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, 2024. 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.

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.

Contacts

Howard Hughes Holdings Inc.

Media Relations:

Cristina Carlson, 646-822-6910

Senior Vice President, Head of Corporate Communications

cristina.carlson@howardhughes.com

Investor Relations:

Eric Holcomb, 281-475-2144

Senior Vice President, Investor Relations

eric.holcomb@howardhughes.com

 
 
                    HOWARD HUGHES HOLDINGS INC. 
               CONSOLIDATED STATEMENTS OF OPERATIONS 
 
                     Three Months Ended          Year Ended 
                        December 31,             December 31, 
                    --------------------  ------------------------- 
thousands except 
per share amounts     2024       2023        2024         2023 
                                -------                 -------- 
REVENUES 
   Condominium 
    rights and 
    unit sales      $778,590   $    792   $  778,616   $  47,707 
   Master Planned 
    Communities 
    land sales        67,751    193,140      453,195     370,185 
   Rental revenue    106,639     93,453      422,100     383,617 
   Other land, 
    rental, and 
    property 
    revenues          13,650     10,353       44,755      46,255 
   Builder price 
    participation     16,960     15,226       52,023      60,989 
------------------   -------    -------    ---------    -------- 
    Total revenues   983,590    312,964    1,750,689     908,753 
------------------   -------    -------    ---------    -------- 
 
EXPENSES 
   Condominium 
    rights and 
    unit cost of 
    sales            566,880       (973)     582,574      55,417 
   Master Planned 
    Communities 
    cost of sales     25,937     73,916      169,191     140,050 
   Operating costs    59,166     57,527      208,578     205,453 
   Rental property 
    real estate 
    taxes             14,596     10,891       58,395      55,649 
   Provision for 
    (recovery of) 
    doubtful 
    accounts             177     (1,728)         504      (2,762) 
   General and 
    administrative    22,822     21,300       91,752      86,671 
   Depreciation 
    and 
    amortization      44,966     46,517      179,799     168,734 
   Other               3,734      4,468       15,002      13,302 
------------------   -------    -------    ---------    -------- 
    Total expenses   738,278    211,918    1,305,795     722,514 
------------------   -------    -------    ---------    -------- 
 
OTHER 
   Gain (loss) on 
    sale or 
    disposal of 
    real estate 
    and other 
    assets, net       14,948      3,162       22,907      24,162 
   Other income 
    (loss), net          250        909       92,120       5,823 
------------------   -------    -------    ---------    -------- 
    Total other       15,198      4,071      115,027      29,985 
------------------   -------    -------    ---------    -------- 
 
Operating income 
 (loss)              260,510    105,117      559,921     216,224 
 
Interest income        6,079      8,734       25,349      25,500 
Interest expense     (42,329)   (44,792)    (164,926)   (157,575) 
Gain (loss) on 
 extinguishment of 
 debt                   (267)       (97)        (465)        (97) 
Gain (loss) on 
 sale of MUD 
 receivables           2,874         --      (48,651)         -- 
Equity in earnings 
 (losses) from 
 unconsolidated 
 ventures             (1,599)      (685)      (5,829)     25,776 
------------------   -------    -------    ---------    -------- 
Income (loss) from 
 continuing 
 operations before 
 income taxes        225,268     68,277      365,399     109,828 
Income tax expense 
 (benefit)            62,948     15,443       80,184      26,418 
------------------   -------    -------    ---------    -------- 
Net income (loss) 
 from continuing 
 operations          162,320     52,834      285,215      83,410 
Net income (loss) 
 from discontinued 
 operations, net 
 of taxes             (6,416)   (18,461)     (88,223)   (634,940) 
------------------   -------    -------    ---------    -------- 
Net income (loss)    155,904     34,373      196,992    (551,530) 
Net (income) loss 
 attributable to 
 noncontrolling 
 interests               414        (77)         711        (243) 
------------------   -------    -------    ---------    -------- 
Net income (loss) 
 attributable to 
 common 
 stockholders       $156,318   $ 34,296   $  197,703   $(551,773) 
------------------   -------    -------    ---------    -------- 
 
Basic income 
 (loss) per share 
 -- continuing 
 operations         $   3.27   $   1.06   $     5.75   $    1.68 
Diluted income 
 (loss) per share 
 -- continuing 
 operations         $   3.25   $   1.06   $     5.73   $    1.68 
------------------   -------    -------    ---------    -------- 
 
 
 
 
                       HOWARD HUGHES HOLDINGS INC. 
                        CONSOLIDATED BALANCE SHEETS 
                                 UNAUDITED 
 
thousands except par values 
and share amounts                December 31, 2024     December 31, 2023 
-----------------------------  --------------------  --------------------- 
ASSETS 
   Master Planned Communities 
    assets                      $        2,511,662    $       2,445,673 
   Buildings and equipment               3,841,872            3,649,376 
   Less: accumulated 
    depreciation                          (949,533)            (829,018) 
   Land                                    302,446              294,189 
   Developments                          1,341,029            1,169,571 
-----------------------------      ---------------       -------------- 
Net investment in real estate            7,047,476            6,729,791 
Investments in unconsolidated 
 ventures                                  169,566              182,799 
Cash and cash equivalents                  596,083              629,714 
Restricted cash                            402,420              379,498 
Accounts receivable, net                   105,185              101,373 
Municipal Utility District 
 $(MUD)$ receivables, net                    463,799              550,884 
Deferred expenses, net                     139,350              138,182 
Operating lease right-of-use 
 assets                                      5,806                5,463 
Other assets, net                          281,551              244,027 
Assets of discontinued 
 operations                                     --              615,272 
-----------------------------      ---------------       -------------- 
    Total assets                $        9,211,236    $       9,577,003 
-----------------------------      ---------------       -------------- 
 
LIABILITIES 
Mortgages, notes, and loans 
 payable, net                   $        5,127,469    $       5,146,992 
Operating lease obligations                  5,456                5,362 
Deferred tax liabilities, net              142,100               84,293 
Accounts payable and other 
 liabilities                             1,094,437            1,054,267 
Liabilities of discontinued 
 operations                                     --              227,165 

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February 26, 2025 16:01 ET (21:01 GMT)