The Howard Hughes Corporation® Reports Fourth Quarter and Full Year 2016 Results

DALLAS--()--The Howard Hughes Corporation ® (NYSE:HHC) (the “Company”) announced operating results for the fourth quarter ended December 31, 2016. The attached financial statements, exhibits and reconciliations of non-GAAP measures provide the details of these results.

“In the fourth quarter, The Howard Hughes Corporation showed significant progress across our three business segments as we saw significant growth with increased Operating Asset NOI, increased MPC residential land sales and meaningful progress in our strategic developments with the delivery of our first residential building in Ward Village, Waiea”

Fourth Quarter Highlights:

  • Net income attributable to common stockholders was $43.6 million or $1.02 per diluted share.
  • Adjusted net income was $72.1 million or $1.69 per share, an increase of $19.7 million or $0.46 per share compared to the fourth quarter of 2015.
  • Increased Operating Asset NOI to $38.0 million, an increase of $10.2 million compared to the fourth quarter of 2015.
  • Increased MPC residential land sales to $49.0 million, an increase of $9.6 million compared to the fourth quarter of 2015.
  • At Ward Village in Honolulu, delivered our first condominium tower, Waiea, with approximately 92% of the 174 units contracted for sale.
  • Received approval for a $90.0 million tax increment financing for Downtown Columbia’s master plan.
  • Acquired One Mall North, a 100% leased, 97,500 square foot office building for $22.2 million and American City Building for $13.5 million, both in Columbia, Maryland.
  • Sold Park West for net cash proceeds of $32.5 million, unlocking a $17.6 million tax benefit and allowing us to recycle our capital and invest in higher return opportunities within our core assets.
  • Ended the year with net debt to total market capitalization of 36.8%, and a cash balance of $665.5 million.

“In the fourth quarter, The Howard Hughes Corporation showed significant progress across our three business segments as we saw significant growth with increased Operating Asset NOI, increased MPC residential land sales and meaningful progress in our strategic developments with the delivery of our first residential building in Ward Village, Waiea,” said David R. Weinreb, Chief Executive Officer. “We are creating value across our portfolio every day, as we continue to transform our strategic developments into revenue generating assets, converting our assets into a predominantly revenue-generating portfolio. Additionally, I am pleased with our capital recycling activity, both during and subsequent to the quarter, with the sale of non-core assets and acquisitions that complement our holdings in Downtown Columbia. Further, we are pleased with our conservative financial position with a cash balance of over $665 million, which is well in excess of our unfunded development commitments.”

       

Fourth Quarter Financial Results

 
(In thousands, except per share amounts) Three Months Ended December 31, Year ended December 31,
2016 2015 2016 2015
Net income (loss) attributable to common stockholders $ 43,595 $ 25,881 $ 202,303 $ 126,719
 
Basic income per share $ 1.10 $ 0.65 $ 5.12 $ 3.21
 
Diluted income per share $ 1.02 $ 0.59 $ 4.73 $ 1.60
 
Adjusted net income $ 72,109 $ 52,431 $ 332,340 $ 138,323
 
Adjusted income per share $ 1.69 $ 1.23 $ 7.78 $ 3.24
 

As we complete and place our developments into service, non-cash depreciation and amortization expense associated with these cash-generative commercial real estate properties has become a material component of our net income. Adjusted net income is a non-GAAP measure that excludes depreciation and amortization expense, provision for impairment, non-cash warrant liability gains and losses, gain on acquisition of our joint venture partner’s interest and gains or losses on sales of operating properties. For additional information, please see the reconciliation of Adjusted net income to Net Income (loss) attributable to common stockholders in the Supplemental Information in this earnings release.

       
Business Segment Operating Results
 

Operating Assets Segment Highlights

 
Three Months Ended December 31, Year ended December 31,
(In thousands) 2016 2015 2016 2015
Retail, Office, Multi-family and Hospitality NOI (a) $ 37,311 $ 29,746 $ 134,832 $ 116,160
 
Operating Assets EBT 5,761 (2,570 ) $ (19,132 ) $ (9,902 )
 
Adjusted Operating Assets EBT $ 30,229 $ 24,550 $ 111,148 $ 91,595
 

(a) Includes our share of NOI from our non-consolidated equity method ventures (our “income-producing Operating Assets”). These amounts exclude NOI from properties that are substantially closed for redevelopment and properties sold during the periods.

 

Net operating income (“NOI”) from our income-producing Operating Assets is presented in our Supplemental Information to this earnings release. For a reconciliation of Operating Assets NOI to Operating Assets earnings before taxes (“EBT”), Operating Assets EBT to GAAP-basis net income (loss) and Adjusted net income to Net income, please refer to the Supplemental Information contained in this earnings release.

We calculate Adjusted Operating Assets EBT, which excludes depreciation and amortization and development-related demolition, marketing costs and provision for impairment, as they do not represent operating costs for stabilized real estate properties.

Operating assets EBT increased $8.4 million to $5.8 million, compared to ($2.6) million for the fourth quarter 2015.

The increase in NOI from income-producing Operating Assets in the fourth quarter 2016 compared to the fourth quarter 2015 is primarily driven by the continued stabilization of our recently developed and placed in service office properties and our two recently opened hotels in The Woodlands. The increase in NOI from income-producing Operating Assets in the year ended December 31, 2016, compared to the same period in the prior year is primarily due to Downtown Summerlin and the openings of the ONE Summerlin office building and two multi-family properties in The Woodlands in 2015.

Master Planned Communities Segment Highlights

Generally, MPC revenues fluctuate during the year; therefore, a better measurement of performance is the full year impact instead of quarterly results.

A Summary of our MPC segment is shown below. For additional detail, please refer to the Supplemental Information section of this release.

           

Summary of MPC Residential Land Sales Closed for the Three Months Ended December 31,

 
Land Sales Acres Sold Price per acre
($ In thousands) 2016 2015 2016 2015 2016 2015
Bridgeland
Residential $ 6,917 $ 2,510 18.8 7.2 $ 368 $ 349
Summerlin
Residential 24,551 29,175 35.6 61.0 690 478
The Woodlands
Residential   17,529   7,693 30.8 11.7 569 658
Total residential land sales closed in period $ 48,997 $ 39,378 85.2 79.9
 
           

Summary of MPC Residential Land Sales Closed for the Year Ended December 31,

 
Land Sales Acres Sold Price per acre
($ In thousands) 2016 2015 2016 2015 2016 2015
Bridgeland
Residential $ 20,474 $ 10,856 55.0 28.4 $ 372 $ 382
Summerlin
Residential 110,708 114,509 239.1 198.4 463 577
The Woodlands
Residential   31,960   32,441 57.1 48.7 560 666
Total residential land sales closed in period $ 163,142 $ 157,806 351.2 275.5
 

Residential land sales closed in our MPC segment for the three months ended December 31, 2016, increased $9.6 million or 24.4% to $49.0 million, compared to $39.4 million for the same period in 2015 primarily due to increased sales velocity at The Woodlands and Bridgeland MPCs, offset by fewer sales at our Summerlin MPC. Residential land sales closed in our MPC segment for the year ended December 31, 2016, increased $5.3 million or 3.4% to $163.1 million compared to $157.8 million for the same period in 2015. Land sales revenue of $215.3 million recognized for the year ended December 31, 2016, included $33.4 million in revenue from closings in prior periods which was previously deferred and that met criteria for recognition in the current year.

Land development in the fourth quarter 2016 at The Summit, our joint venture with Discovery Land in our Summerlin MPC, continued on schedule based upon the initial plan. For the three months ended December 31, 2016, 22 custom residential lots had closed resulting in the recognition of $20.9 million Equity in earnings in Real Estate and Other Affiliates. As of December 31, 2016, contracted sales since inception are $226.4 million of which $184.9 million had closed.

Strategic Developments Segment Highlights

We have condominiums for sale in Ward Village across five condominium projects, four of which are under construction: Waiea, Anaha, Ae`o, and Ke Kilohana. These four projects have a total unit count of 1,381, of which 1,109 were under contract as of December 31, 2016, leaving the total number of unsold units under construction at 272.

           
Ward Village Towers Under Construction as of December 31, 2016
 
($ in millions) Total Units Under Contract Percent of Units Sold Total Projected Costs Costs Incurred to Date

Estimated Completion Date

Waiea 174 160 92.0 % $ 414.2 $ 352.9 Q1 2017 (a)
Anaha 317 298 94.0 % 401.3 209.5 Q3 2017
Ae`o 466 265 56.9 % 428.5 (b) 66.6 Q4 2018
Ke Kilohana 424 386 91.0 %   218.9     17.9 2019
Total under construction 1,381 1,109 80.3 % $ 1,462.9   $ 646.9
 

(a) Waiea opened and customers began occupying units in November 2016. We closed on 143 units as of January 27, 2016.

(b) Includes project costs for our flagship Whole Foods Market located on the same block.
 

The increase in condominium rights and unit sales for the quarter and year ended December 31, 2016, as compared to the same periods in 2015 is primarily related to revenue recognition at our Anaha condominium project for which we began recognizing revenue in the second quarter 2015. As condominium projects advance towards completion, revenue is recognized on qualifying sales contracts under the percentage of completion method of accounting. All development cost estimates presented herein are exclusive of land costs.

For a more complete description of the status of our developments, please refer to “Item 7. - Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Form 10-K for the year ended December 31, 2016.

Balance Sheet and Other Quarterly Activity

As of December 31, 2016, our debt equaled approximately 42.3% of our total assets and 36.8% of our total market capitalization. We finished the year with approximately $665.5 million of cash on hand. This balance is higher than in previous periods as a result of end of year cash inflows relating to proceeds from our sale of our non-core Park West asset; a distribution of cash from our joint venture in Summerlin, The Summit; and to proceeds from closings of condominium units at Waiea in our Ward Village urban master planned community.

We have focused almost exclusively on obtaining non-recourse* debt for both our construction financing and long-term fixed rate mortgage financing and have limited cross-collateralization across the portfolio. Our low-leverage, with a focus on project specific financing, insulates us against potential downturns and provides us with the ability to evaluate new opportunities. During the quarter, we completed a $142.7 million partial recourse construction loan for Ke Kilohana and a $230.0 million non-recourse construction loan for Ae`o, both initially maturing in December 2019. We also amended and restated our financing for The Woodlands Resort & Conference Center with a $70.0 million mortgage and modified our construction financing for Hughes Landing Retail to $35.0 million with an extended initial maturity date of December 2036 (previously December 2018).

Subsequent to quarter end in January 2017, we closed on a non-recourse financing totaling $25.0 million at 4.48% interest, replacing the $23.0 million construction loan on the Columbia Regional Building. We also amended and restated our $80.0 million non-recourse mortgage financing for the 10-60 Columbia Corporate Center office buildings with a $94.5 million loan at LIBOR plus 1.75% with an initial maturity May 2020 maturity date. This amendment also provided $14.5 million to purchase One Mall North, a 97,500 square foot office building in Columbia, Maryland.

*Non-recourse debt means that the debt is non-recourse to The Howard Hughes Corporation but is collateralized by a real estate asset and/or is recourse to the subsidiary entity owning such asset.

About The Howard Hughes Corporation®

The Howard Hughes Corporation owns, manages and develops commercial, residential and mixed-use real estate throughout the U.S. Our properties include master planned communities, operating properties, development opportunities and other unique assets spanning 14 states from New York to Hawai‘i. The Howard Hughes Corporation is traded on the New York Stock Exchange under HHC with major offices in New York, Columbia, MD, Dallas, Houston, Las Vegas and Honolulu. For additional information about HHC, visit www.howardhughes.com or find us on Facebook, Twitter, Instagram, and LinkedIn.

Safe Harbor Statement

Statements made in this press release that are not historical facts, including statements accompanied by words such as “will,” “believe,” “expect,” “enables,” “realize”, “plan,” “intend,” “assume,” “transform” and other words of similar expression, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management’s expectations, estimates, assumptions, and projections as of the date of this release and are not guarantees of future performance. Actual results may differ materially from those expressed or implied in these statements. Factors that could cause actual results to differ materially are set forth as risk factors in The Howard Hughes Corporation’s filings with the Securities and Exchange Commission, including its Quarterly and Annual Reports. The Howard Hughes Corporation cautions you not to place undue reliance on the forward-looking statements contained in this release. The Howard Hughes Corporation does not undertake any obligation to publicly update or revise any forward-looking statements to reflect future events, information or circumstances that arise after the date of this release.

       
THE HOWARD HUGHES CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
UNAUDITED
 
(In thousands, except per share amounts) Three Months Ended December 31, Year Ended December 31,
2016 2015 2016 2015
Revenues:
Condominium rights and unit sales $ 123,021 $ 104,922 $ 485,634 $ 305,284
Master Planned Community land sales 68,150 48,462 215,318 187,399
Minimum rents 45,013 40,808 173,268 150,805
Builder price participation 5,755 6,561 21,386 26,846
Tenant recoveries 11,222 8,468 44,330 39,542
Hospitality revenues 16,126 10,118 62,252 45,374
Other land revenues 4,009 3,748 16,232 14,803
Other rental and property revenues   5,250     6,306     16,585     27,035  
Total revenues   278,546     229,393     1,035,005     797,088  
 
Expenses:
Condominium rights and unit cost of sales 81,566 64,859 319,325 191,606
Master Planned Community cost of sales 29,599 20,259 95,727 88,065
Master Planned Community operations 11,919 12,612 42,371 44,907
Other property operating costs 18,465 18,292 65,978 72,751
Rental property real estate taxes 5,737 4,462 26,847 24,138
Rental property maintenance costs 3,175 1,974 12,392 10,712
Hospitality operating costs 11,980 8,101 49,359 34,839
Provision for doubtful accounts 1,035 948 5,664 4,030
Demolition costs 994 660 2,212 3,297
Development-related marketing costs 6,598 5,990 22,184 25,466
General and administrative 25,083 24,250 86,588 81,345
Depreciation and amortization   24,618     27,420     95,864     98,997  
Total expenses   220,769     189,827     824,511     680,153  
 
Operating income before other items 57,777 39,566 210,494 116,935
 
Other:
Provision for impairment (35,734 )
Gain on sale of 80 South Street Assemblage 140,549
Other income, net   1,595     625     11,453     1,829  
Total other   1,595     625     116,268     1,829  
 
Operating income 59,372 40,191 326,762 118,764
 
Interest income 459 70 1,359 586
Interest expense (17,096 ) (16,601 ) (65,724 ) (59,744 )
Warrant liability (loss) gain (2,780 ) 870 (24,410 ) 58,320
Gain on acquisition of joint venture partner's interest 27,088
(Loss) gain on disposal of operating assets (1,117 ) (1,117 ) 29,073
Equity in earnings from Real Estate and Other Affiliates   21,118     557     56,818     3,721  
Income before taxes 59,956 25,087 320,776 150,720
(Provision) benefit for income taxes   (16,361 )   794     (118,450 )   (24,001 )
Net income 43,595 25,881 202,326 126,719
Net income attributable to noncontrolling interests           (23 )    
Net income attributable to common stockholders $ 43,595   $ 25,881   $ 202,303   $ 126,719  
                       
Basic income per share: $ 1.10   $ 0.65   $ 5.12   $ 3.21  
                       
Diluted income per share: $ 1.02   $ 0.59   $ 4.73   $ 1.60  
 
   
THE HOWARD HUGHES CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
UNAUDITED
 
December 31,
(In thousands, except share amounts) 2016 2015
Assets:
Investment in real estate:
Master Planned Community assets $ 1,669,561 $ 1,642,842
Land 320,936 322,462
Buildings and equipment 2,027,363 1,772,401
Less: accumulated depreciation (245,814 ) (232,969 )
Developments   961,980     1,036,927  
Net property and equipment 4,734,026 4,541,663
Investment in Real Estate and Other Affiliates   76,376     57,811  
Net investment in real estate 4,810,402 4,599,474
Cash and cash equivalents 665,510 445,301
Accounts receivable, net 9,883 9,962
Municipal Utility District receivables, net 150,385 139,946
Notes receivable, net 155 1,664
Deferred expenses, net 64,531 61,804
Prepaid expenses and other assets, net   666,516     463,431  
Total assets $ 6,367,382   $ 5,721,582  
 
Liabilities:
Mortgages, notes and loans payable $ 2,690,747 $ 2,443,962
Deferred tax liabilities 200,945 89,221
Warrant liabilities 332,170 307,760
Uncertain tax position liability 1,396
Accounts payable and accrued expenses   572,010     515,354  
Total liabilities   3,795,872     3,357,693  
 
Equity:
Preferred stock: $.01 par value; 50,000,000 shares authorized, none issued

Common stock: $.01 par value; 150,000,000 shares authorized, 39,802,064 shares issued and 39,790,003 outstanding as of December 31, 2016, and 39,714,838 shares issued and outstanding as of December 31, 2015

398 398
Additional paid-in capital 2,853,269 2,847,823
Accumulated deficit (277,912 ) (480,215 )
Accumulated other comprehensive loss (6,786 ) (7,889 )

Treasury stock, at cost, 12,061 and 0 shares as of December 31, 2016, and December 31, 2015, respectively

  (1,231 )    
Total stockholders' equity 2,567,738 2,360,117
Noncontrolling interests   3,772     3,772  
Total equity   2,571,510     2,363,889  
Total liabilities and equity $ 6,367,382   $ 5,721,582  
 

Supplemental Information

December 31, 2016

Because our three segments, Master Planned Communities, Operating Assets and Strategic Developments, are managed separately, we use different operating measures to assess operating results and allocate resources among these three segments. The one common operating measure used to assess operating results for our business segments is earnings before taxes (“EBT”). EBT, as it relates to each business segment, represents the revenues less expenses of each segment, including interest income, interest expense and equity in earnings of real estate and other affiliates. 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. However, EBT should not be considered as an alternative to GAAP net income.

       
Reconciliation of EBT to GAAP income (loss) before taxes Three Months December 31, Year Ended December 31,
(In thousands) 2016 2015 2016 2015
Total consolidated segment EBT $ 103,997 $ 63,122 $ 458,518 $ 202,300
Corporate and other items:
General and administrative (25,083 ) (24,250 ) (86,588 ) (81,345 )
Corporate interest expense, net (13,102 ) (13,286 ) (52,460 ) (52,995 )
Warrant liability (loss) gain (2,780 ) 870 (24,410 ) 58,320
Gain on acquisition of joint venture partner's interest 1 (29,073 ) 27,088
(Loss) gain on disposal of operating assets (1,117 ) 29,073 (1,117 ) 29,073
Corporate other income, net 51 105 6,241 1,409
Corporate depreciation and amortization   (2,010 )   (1,474 )   (6,496 )   (6,042 )
Total Corporate and other items   (44,040 )   (51,580 )   (137,742 )   (51,580 )
Income before taxes $ 59,957   $ 25,087   $ 320,776   $ 150,720  
 

We also adjust GAAP net income (loss) for non-cash warrant liability gains and losses, and depreciation and amortization. The presentation of Adjusted net income is consistent with other companies in the real estate business who also typically report an earnings measure that excludes depreciation and amortization and other non-operating related items.

       
Three Months Ended December 31, Year Ended December 31,
(In thousands) 2016 2015 2016 2015
Adjusted net income $ 72,109 $ 52,431 $ 332,340 $ 138,323
Depreciation and amortization (24,618 ) (27,420 ) (95,864 ) (98,997 )
Provision for impairment (35,734 )
Warrant liability (loss) gain (2,780 ) 870 (24,410 ) 58,320
Gain on acquisition of joint venture partner's interest 1 27,088
(Loss) gain on disposal of operating assets   (1,117 )       (1,117 )   29,073  
Net income attributable to common stockholders $ 43,595   $ 25,881   $ 202,303   $ 126,719  
 

When a development property is placed in service, depreciation is calculated for the property ratably over the estimated useful lives of each of its components; however, most of our recently developed properties do not reach stabilization until 12 to 36 months after being placed in service due to the timing of tenants taking occupancy and subsequent leasing of remaining unoccupied space during that period. As a result, operating income, earnings before taxes (EBT) and net income will not reflect the ongoing earnings potential of newly placed in service operating assets during this transition period to stabilization. Accordingly, we calculate Adjusted Operating Assets EBT, which excludes depreciation and amortization and development-related demolition and marketing costs and provision for impairment, as they do not represent operating costs for stabilized real estate properties.

The following table reconciles Adjusted Operating Assets EBT to Operating Assets EBT:

       
Reconciliation of Adjusted Operating Assets EBT to Operating Assets EBT (in thousands) Three Months Ended December 31, Year Ended December 31,
2016 2015 2016 2015
Adjusted Operating Assets segment EBT $ 30,229 $ 24,550 $ 111,148 $ 91,595
Provision for impairment (35,734 )
Depreciation and amortization (21,767 ) (24,490 ) (86,313 ) (89,075 )
Demolition costs (629 ) (264 ) (1,123 ) (2,675 )
Development-related marketing costs   (2,072 )   (2,366 )   (7,110 )   (9,747 )
Operating Assets segment EBT $ 5,761   $ (2,570 ) $ (19,132 ) $ (9,902 )
 

The following table summarizes our net debt on a segment basis as of December 31, 2016. Net debt is defined as mortgages, notes and loans payable, including our ownership share of debt of our Real Estate and Other Affiliates, reduced by short-term liquidity sources to satisfy such obligations such as our ownership share of cash and cash equivalents and SID and MUD receivables. Although net debt is not a recognized GAAP financial measure, it is readily computable from existing GAAP information and we believe, as with our other non-GAAP measures, that such information is useful to our investors and other users of our financial statements.

           
Master Non-
(In thousands) Planned Operating Strategic Segment Segment Total
Segment Basis Communities Assets Developments Totals Amounts December 31, 2016
Mortgages, notes and loans payable $ 255,438 $ 1,552,697 (b) $ 189,858 $ 1,997,993 $ 748,235 $ 2,746,228
Less: cash and cash equivalents (108,896 ) (a) (86,009 ) (c) (15,274 ) (d) (210,179 ) (518,891 ) (729,070 )
Special Improvement District receivables (61,603 ) (61,603 ) (61,603 )
Municipal Utility District receivables   (150,385 )                 (150,385 )       (150,385 )
Net Debt $ (65,446 )   $ 1,466,688     $ 174,584     $ 1,575,826   $ 229,344   $ 1,805,170  
 
(a) Includes MPC cash and cash equivalents, including $53.1 million of cash related to The Summit joint venture.
(b) Includes our $55.5 million share of debt of our Real Estate and Other Affiliates in Operating Assets segment (Woodlands Sarofim #1, The Metropolitan Downtown Columbia and Millennium Woodlands Phase II, LLC, Stewart Title of Montgomery County, TX, 33 Peck Slip, Constellation, and Las Vegas 51s).
(c) Includes our $6.5 million share of cash and cash equivalents of our Real Estate and Other Affiliates in Operating Assets segment (Woodlands Sarofim #1, The Metropolitan Downtown Columbia and Millennium Woodlands Phase II, LLC, Stewart Title of Montgomery County, TX, 33 Peck Slip, Constellation, and Las Vegas 51s).
(d) Includes our $3.9 million share of cash and cash equivalents of our Real Estate and Other Affiliates in Strategic Developments segment (KR Holdings, LLC, HHMK Development, LLC, and m.flats/TEN.M).
 
                   
Summary of Residential MPC Land Sales Closed for the Three Months Ended December 31,
 
Land Sales Acres Sold

Number of Lots/Units

Price per acre   Price per lot
($ In thousands) 2016 2015 2016 2015 2016 2015 2016 2015 2016 2015
Bridgeland
Single family - detached $ 6,917   $ 2,510 18.8   7.2 95   36 $ 368   $ 349 $ 73   $ 70

$ Change

4,407 11.6 59 19 3

% Change

175.6 % 161.1 % 163.9 % 5.4 % 4.3 %
 
Maryland Communities
No land sales
 
Summerlin
Superpad sites 14,856 28,435 30.6 60.5 128 162 485 470 116 176
Custom lots   9,695   740 5.0   0.5 8   1 1,939   1,480 1,212   740
Total 24,551 29,175 35.6 61.0 136 163 690 478 181 179

$ Change

(4,624 ) (25.4 ) (27 ) 212 2

% Change

(15.8 %) (41.6 %) (16.6 %) 44.4 % 1.1 %
 
The Woodlands
Single family - detached 10,519 7,693 24.9 11.7 99 48 422 658 106 160
Single family - attached   7,010   5.9   67   1,188   105  
Total 17,529 7,693 30.8 11.7 166 48 569 658 106 160

$ Change

9,836 19.1 118 (89 ) (54 )

% Change

127.9 % 163.2 % 245.8 % (13.5 %) (33.8 %)
                     
Total land sales closed in period (a) $ 48,997   $ 39,378 85.2   79.9 397   247
 

(a) Excludes revenues closed and deferred for recognition in a previous period that met criteria for recognition in the current period.

         
Summary of Commercial MPC Land Sales Closed for the Three Months Ended December 31,
 
Land Sales Acres Sold Price per acre
($ In thousands) 2016 2015 2016 2015 2016   2015
Bridgeland
Not-for-profit $   $ 189   2.2 $   86

$ Change

(189 ) (2.2 ) (86 )

% Change

(100.0 %) (100.0 %) (100.0 %)
 
Maryland Communities
No land sales
 
Summerlin
Other       800   16.7   48

$ Change

(800 ) (16.7 ) (48 )

% Change

(100.0 %) (100.0 %) (100.0 %)
 
The Woodlands
Medical 1,585 1.7 932
Other       926   1.5   617
Total 2,511 3.2

 

 

785

$ Change

(2,511 ) (3.2 ) (785 )

% Change

(100.0 %) (100.0 %) (100.0 %)
               
Total land sales closed in period (a) $

  $ 3,500

  22.1
 

(a) Excludes revenues closed and deferred for recognition in a previous period that met criteria for recognition in the current period.

 

Reconciliation of MPC Land Sales Closed to GAAP Land Sales Revenue

The following table reconciles Total residential and commercial land sales closed for the quarters ended December 31, 2016 and 2015, respectively, to Total land sales revenue – GAAP basis for the MPC segment for the quarters ended December 31, 2016 and 2015, respectively. Total net recognized (deferred) revenue represents revenues on sales closed in prior periods where revenue was previously deferred and met criteria for recognition in the current periods, offset by revenues deferred on sales closed in the current period.

   
For the Three Months December 31,
(In thousands) 2016 2015
Total residential land sales closed in period $ 48,997 $ 39,378
Total commercial land sales closed in period 3,500
Net recognized (deferred) revenue:
Bridgeland 1,345 225
Summerlin   15,655 (11,302 )
Total net recognized (deferred) revenue   17,000   (11,077 )
Special Improvement District bond revenue   2,153   16,661  
Total land sales revenue - GAAP basis $ 68,150 $ 48,462  
 
                     
Summary of Residential MPC Land Sales Closed for the Year Ended December 31,
 
Land Sales Acres Sold Number of Lots/Units Price per acre Price per lot
($ In thousands) 2016 2015 2016 2015 2016 2015 2016 2015 2016 2015
Bridgeland
Single family - detached $ 20,474   $ 10,856 55.0   28.4 296   130 $ 372   $ 382 $ 69   $ 84

$ Change

9,618 26.6 166 (10 ) (15 )

% Change

88.6 % 93.7 % 127.7 % (2.6 %) (17.9 %)
 
Maryland Communities
No land sales
 
Summerlin
Superpad sites 96,843 92,219 231.7 177.7 1,071 555 418 519 90 166
Single family - detached 13,650 14.9 75 916 182
Custom lots   13,865   8,640 7.4   5.8 15   14 1,874   1,490 924   617
Total 110,708 114,509 239.1 198.4 1,086 644 463 577 102 178

$ Change

(3,801 ) 40.7 442 (114 ) (76 )

% Change

(3.3 %) 20.5 % 68.6 % (19.9 %) (42.7 %)
 
The Woodlands
Single family - detached 24,950 27,161 51.2 42.9 204 160 487 633 122 170
Single family - attached   7,010   5,280 5.9   5.8 67   65 1,188   910 105   81
Total 31,960 32,441 57.1 48.7 271 225 560 666 118 144

$ Change

(481 ) 8.4 46 (106 ) (26 )

% Change

(1.5 %) 17.2 % 20.4 % (16.0 %) (18.2 %)
                     
Total land sales closed in period (a) $ 163,142   $ 157,806 351.2   275.5 1,653   999
 

(a) Excludes revenues closed and deferred for recognition in a previous period that met criteria for recognition in the current period.

         
Summary of Commercial MPC Land Sales Closed for the Year Ended December 31,
 
Land Sales Acres Sold   Price per acre
($ In thousands) 2016 2015 2016 2015   2016 2015
Bridgeland
Not-for-profit $ $ 20,664 162.4 $ $ 127

$ Change

(20,664 ) (162.4 ) (127 )

% Change

(100.0 %) (100.0 %) (100.0 %)
 
Maryland Communities
No land sales
 
Summerlin
Commercial
Not-for-profit 348.0 10.0 35
Other   3,936   20.3   194
Total 348.0 3,936 10.0 20.3 35 194

$ Change

(3,588 ) (10.3 ) (159 )

% Change

(91.2 %) (50.7 %) (82.0 %)
 
The Woodlands
Commercial
Medical 10,405 8,422 4.3 5.0 2,420 1,684
Not-for-profit 733 5.0 147
Other       2,247   2.4   936
Total 10,405 11,402 4.3 12.4 2,420 920

$ Change

(997 ) (8.1 ) 1,500

% Change

(8.7 %) (65.3 %) 163.0 %
               
Total land sales closed in period (a) $ 10,753   $ 36,002 14.3   195.1
 

(a) Excludes revenues closed and deferred for recognition in a previous period that met criteria for recognition in the current period.

 

Reconciliation of MPC Land Sales Closed to GAAP Land Sales Revenue

The following table reconciles Total residential and commercial land sales closed for the years ended December 31, 2016 and 2015, respectively, to Total land sales revenue – GAAP basis for the MPC segment for the years ended December 31, 2016 and 2015, respectively. Total net recognized (deferred) revenue represents revenues on sales closed in prior periods where revenue was previously deferred and met criteria for recognition in the current periods, offset by revenues deferred on sales closed in the current period.

   
For the Year Ended December 31,
(In thousands) 2016 2015
Total residential land sales closed in period $ 163,142 $ 157,806
Total commercial land sales closed in period 10,753 36,002
Net recognized (deferred) revenue:
Bridgeland 3,780 (11,136 )
Summerlin   29,596   (16,043 )
Total net recognized (deferred) revenue   33,376   (27,179 )
Special Improvement District revenue   8,047   20,770  
Total land sales revenue - GAAP basis $ 215,318 $ 187,399  
 

Operating Assets Net Operating Income

We believe that NOI is a useful supplemental measure of the performance of our Operating Assets 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 occupancy rates, rental rates, and operating costs. We define NOI as revenues (rental income, tenant recoveries and other income) less expenses (real estate taxes, repairs and maintenance, marketing and other property expenses). NOI also excludes straight-line rents and tenant incentives amortization, net interest expense, ground rent amortization, demolition costs, amortization, depreciation, development-related marketing costs and equity in earnings from Real Estate and Other Affiliates.

We use NOI to evaluate our operating performance on a property-by-property basis because NOI allows us to evaluate the impact that factors such as lease structure, lease rates and tenant base, which vary by property, have on our operating results, gross margins and investment returns.

Although we believe that NOI provides useful information to the investors about the performance of our Operating Assets, due to the exclusions noted above, NOI should only be used as an alternative measure of the financial performance of such assets and not as an alternative to GAAP net income.

           

Operating Asset NOI and EBT

 
Three Months Ended Year Ended
December 31, December 31,
(In thousands) 2016   2015 Change 2016   2015 Change

Retail

The Woodlands

Creekside Village Green (a)

$ 380 $ 285 $ 95 $ 1,549 $ 824 $ 725
Hughes Landing Retail (a) 1,057 682 375 3,402 1,468 1,934
1701 Lake Robbins 90 103 (13 ) 364 399 (35 )
20/25 Waterway Avenue 483 499 (16 ) 1,765 1,883 (118 )
Waterway Garage Retail 163 150 13 643 690 (47 )
Columbia
Columbia Regional 363 342 21 1,387 1,342 45
Summerlin
Downtown Summerlin (a) 4,371 3,417 954 16,632 10,117 6,515
Ward Village
Ward Village Retail (b) 5,009 6,181 (1,172 ) 22,048 25,566 (3,518 )
Other
Cottonwood Square 175 183 (8 ) 705 677 28
Lakeland Village Center at Bridgeland (c) 134 134 190 190
Outlet Collection at Riverwalk   1,469     1,606     (137 )   5,125     6,450     (1,325 )
Total Retail NOI   13,694     13,448     246     53,810     49,416     4,394  
 

Office

The Woodlands
One Hughes Landing (d) 1,552 1,151 401 6,014 5,262 752
Two Hughes Landing (e) 2,054 1,110 944 5,033 4,489 544
Three Hughes Landing (c) (105 ) (105 ) (514 ) (514 )

1725 Hughes Landing Boulevard (a)

450 (208 ) 658 120 (208 ) 328

1735 Hughes Landing Boulevard (a)

1,901 (34 ) 1,935 2,857 (34 ) 2,891
2201 Lake Woodlands Drive (14 ) (26 ) 12 (127 ) (144 ) 17
9303 New Trails (f) 384 438 (54 ) 1,641 1,898 (257 )
3831 Technology Forest Drive 453 541 (88 ) 1,968 1,956 12
3 Waterway Square (d) 1,797 1,618 179 6,735 6,288 447

4 Waterway Square (a)

1,680 1,304 376 6,466 5,766 700
1400 Woodloch Forest 414 373 41 1,708 1,621 87
Columbia
10-70 Columbia Corporate Center (f) 2,574 2,927 (353 ) 11,275 12,375 (1,100 )
Columbia Office Properties (g) 29 107 (78 ) (104 ) 450 (554 )
One Mall North (c) 75 75 75 75
Summerlin
ONE Summerlin (a) 836 111 725 2,365 (206 ) 2,571
Other
110 N. Wacker   1,529     1,523     6     6,105     6,100     5  
Total Office NOI   15,609     10,935     4,674     51,617     45,613     6,004  
 

Multi-family

The Woodlands
Millennium Six Pines Apartments (h) 985 985 1,498 1,498
Millennium Waterway Apartments (i) 856 1,018 (162 ) 3,183 4,169 (986 )
One Lakes Edge (a) 1,000 835 165 3,623 982 2,641
South Street Seaport
85 South Street   132     135     (3 )   523     494     29  
Total Multi-family NOI   2,973     1,988     985     8,827     5,645     3,182  
 

Hospitality

The Woodlands
Embassy Suites at Hughes Landing (a) 1,065 (25 ) 1,090 3,563 (25 ) 3,588
The Westin at The Woodlands (a) (c) 1,154 1,154 1,739 1,739
The Woodlands Resort & Conference Center (j)   1,928     2,042     (114 )   7,591     10,560     (2,969 )
Total Hospitality NOI   4,147     2,017     2,130     12,893     10,535     2,358  
Total Retail, Office, Multi-family, and Hospitality NOI   36,423     28,388     8,035     127,147     111,209     15,938  
 

Other

The Woodlands
The Woodlands Ground leases 371 335 36 1,417 1,190 227
The Woodlands Parking Garages (128 ) (53 ) (75 ) (448 ) (508 ) 60
2000 Woodlands Parkway (c) (46 ) (46 ) (51 ) (51 )
Other
Other Properties (c)   946     1,030     (84 )   3,871     3,857     14  
Total Other   1,143     1,312     (169 )   4,789     4,539     250  
Operating Assets NOI excluding properties sold or in redevelopment   37,566     29,700     7,866     131,936     115,748     16,188  
 

Redevelopments

South Street Seaport
South Street Seaport (c) (k) 92 (2,268 ) 2,360 (532 ) (2,692 ) 2,160
Other
Landmark Mall (l)   (150 )   (45 )   (105 )   (676 )   (347 )   (329 )
Total Operating Asset Redevelopments NOI (58 ) (2,313 ) 2,255 (1,208 ) (3,039 ) 1,831
 

Dispositions

The Woodlands
The Club at Carlton Woods (m) (942 ) 942
Other
Park West (n) 489 427 62 1,835 1,812 23
Total Operating Asset Dispositions NOI   489     427     62     1,835     870     965  
Total Operating Assets NOI - Consolidated   37,997     27,814     10,226     132,563     113,579     18,984  
 
Straight-line lease amortization (o) 1,057 4,759 (3,702 ) 10,689 7,391 3,298
Demolition costs (p) (629 ) (264 ) (365 ) (1,123 ) (2,675 ) 1,552
Development-related marketing costs (2,072 ) (2,366 ) 294 (7,110 ) (9,747 ) 2,637
Provision for impairment (35,734 ) (35,734 )
Depreciation and Amortization (21,767 ) (24,490 ) 2,723 (86,313 ) (89,075 ) 2,762
Write-off of lease intangibles and other (60 ) (78 ) 18 (60 ) (671 ) 611
Other income, net 1,475 524 951 4,601 524 4,077
Equity in earnings from Real Estate Affiliates 185 550 (365 ) 2,802 1,883 919
Interest, net   (10,425 )   (9,019 )   (1,406 )   (39,447 )   (31,111 )   (8,336 )
Total Operating Assets segment EBT (q) $ 5,761   $ (2,570 ) $

8,374

  $ (19,132 ) $ (9,902 ) $ (9,230 )
 
           

Three Months Ended

Year Ended

December 31,

December 31,
(In thousands) 2016 2015 Change 2016 2015 Change
Operating Assets NOI - Equity and Cost Method Investments
The Woodlands
Millennium Six Pines Apartments (h) $ $ 911 $ (911 ) $ 1,537 $ 1,414 $ 123
Stewart Title of Montgomery County, TX 566 678 (112 ) 1,977 2,007 (30 )
Woodlands Sarofim # 1 471 302 169 1,541 1,496 45
Columbia
The Metropolitan Downtown Columbia (a) 1,378 911 467 4,137 1,194 2,943
Summerlin
Constellation (108 ) (108 ) (108 ) (108 )
Las Vegas 51s (r) (560 ) (475 ) (85 ) 68 305 (237 )
South Street Seaport
33 Peck Slip (s) $ 448   $   $ 448   $ 1,347   $   $ 1,347  
Total NOI - equity investees 2,195 2,327 (132 ) 10,499 6,416 4,083
 
Adjustments to NOI (t)   (1,487 )   (809 )   (678 )   (9,527 )   (3,069 )   (6,458 )
Equity Method Investments EBT 708 1,518 (810 ) 972 3,347 (2,375 )
Less: Joint Venture Partner's Share of EBT   (523 )   (968 )   445     (786 )   (3,211 )   2,425  
Equity in earnings from Real Estate and Other Affiliates   185     550     (365 )   186     136     50  
 
Distributions from Summerlin Hospital Investment (u)               2,616     1,747     869  
Segment equity in earnings from Real Estate and Other Affiliates $ 185   $ 550   $ (365 ) $ 2,802   $ 1,883   $ 919  
 
Company's Share of Equity Method Investments NOI
The Woodlands
Millennium Six Pines Apartments (h) $ $ 741 $ (741 ) $ 1,252 $ 1,151 $ 101
Stewart Title of Montgomery County, TX 283 339 (56 ) 989 1,004 (15 )
Woodlands Sarofim # 1 94 61 33 308 299 9
Columbia
The Metropolitan Downtown Columbia 689 455 234 2,069 597 1,472
Summerlin
Constellation (54 ) (54 ) (54 ) (54 )
Las Vegas 51s (r) (280 ) (238 ) (42 ) 34 153 (119 )
South Street Seaport
33 Peck Slip (s)   156         156     471         471  
Company's share NOI - equity investees $ 888   $ 1,358   $ (470 ) $ 5,069   $ 3,204   $ 1,865  
 
       
Economic December 31, 2016
(In thousands) Ownership Total Debt Total Cash
The Woodlands
Stewart Title of Montgomery County, TX 50.00 % $ $ 275
Woodlands Sarofim # 1 20.00 5,641 809
Columbia
The Metropolitan Downtown Columbia 50.00 70,000 508
Summerlin
Constellation 50.00 13,475 72
Las Vegas 51s (r) 50.00 32 906
South Street Seaport
33 Peck Slip (s) 35.00 36,000 15,593
 
(a)  

NOI increase for the year ended December 31, 2016, as compared to 2015 relates to an increase in occupancy and/or effective rent, or relates to properties recently placed in service.

(b) The decrease in NOI is due to rent abatement for a tenant related to a lease modification, decrease in occupancy related to a bankrupt tenant and decrease in occupancy due to pending redevelopment.
(c) Please refer to discussion in the consolidated financial statements in the Form 10-K regarding this property.
(d)

NOI increase for year ended December 31, 2016, is due to a decrease in real estate taxes and other operating expenses.

(e)

The NOI increase for the year ended December 31, 2016, is due to increased occupancy.

(f) NOI decrease is due to a decrease in occupancy.
(g)

NOI decrease for the year ended December 31, 2016, is due primarily to decreased occupancy at American City Building related to water damage in 2015 and subsequent loss of tenants. The American City Building amounts in this table represent operations of the building under the master lease agreement through the date of acquisition and operations as a wholly owned asset through December 31, 2016. The acquisition of the land and building are reflected in the Strategic Development segment. The property was purchased on December 19, 2016, for future redevelopment.

(h) Purchased our partner’s 18.57% interest in Millennium Six Pines Apartments (formerly known as Millennium Woodlands Phase II, LLC) in July 2016 and consolidated the property at that time.
(i) NOI decrease is due to a decrease in rental rates to maintain occupancy during the lease up of Millennium Six Pines Apartments and One Lakes Edge.
(j)

NOI decrease for the year ended December 31, 2016, is due to lower occupancy and a decrease in conference center services.

(k)

NOI increase for the year ended December 31, 2016, is due to increased occupancy and event revenue.

(l) The NOI losses in 2016 and 2015 are due to a decline in occupancy as the property loses tenants in anticipation of its redevelopment into an open-air, mixed-use community with retail, residential, and entertainment components. The mall was closed in January 2017.
(m) The Club at Carlton Woods was sold in September 2015.
(n) Park West was sold in December 2016.
(o) The increase is primarily due to new leases at Downtown Summerlin and 1725-1735 Hughes Landing Boulevard, which were placed in service in the fourth quarter 2015.
(p) The decrease in demolition costs is due to completion of the interior demolition of the Fulton Market Building, which was completed in April 2014, and demolition of Pier 17 at the South Street Seaport.
(q) For a detailed breakdown of our Operating Asset segment EBT, please refer to Note 17 - Segments in the consolidated financial statements.
(r) Formerly known as Summerlin Baseball Club, part of the Clark County Las Vegas Stadium LLC joint venture.
(s) Our joint venture with Grandview SHG, LLC owns 33 Peck Slip hotel, which was closed in December 2016 for redevelopment.
(t) Adjustments to NOI include straight-line rent and market lease amortization, demolition costs, depreciation and amortization and non-real estate taxes.
(u) Distributions from the Summerlin Hospital are typically made once per year in the first quarter.
 
           

Commercial Properties NOI

 
(In millions, except square feet/number of units and %)

Square Feet/Number of Units

% Occupied % Leased

NOI for the Three Months Ended December 31, 2016

Projected Annual Stabilized NOI (a)

Debt Balance as of December 31, 2016

Commercial Properties - Stabilized
 
Retail
Cottonwood Square 77,080 95.7 % 95.7 % $ 0.2 $ 0.7 $
Hughes Landing Retail 126,131 97.4 97.4 1.1 3.5 35.0
1701 Lake Robbins 12,376 64.1 64.1 0.1 0.4 4.6
Outlet Collection at Riverwalk 263,892 96.9 96.9 1.5 6.5 55.8
One Lakes Edge Retail 23,280 99.3 99.3
Ward Village (b) 1,138,119 88.8 88.8 5.0 25.6 238.7
20/25 Waterway Avenue 50,062 97.5 97.5 0.5 1.8 13.9
Waterway Garage Retail 21,513 99.8   99.8     0.2     0.8  
Total Retail - Stabilized 1,712,453 91.3 % 91.3 % $ 8.6 $ 39.3 $ 348.0
 
Office
10-70 Columbia Corporate Center 886,803 88.6 % 89.6 % $ 2.6 $ 12.4 $ 100.0
Columbia Office Properties (c) 100,903 90.9 90.9 0.0 0.5

One Hughes Landing 197,719 100.0 100.0 1.6 6.0 52.0
Two Hughes Landing 197,714 96.3 96.3 2.1 6.0 48.0
1735 Hughes Landing Boulevard 318,170 100.0 100.0 1.9 7.5 52.8
9303 New Trails 97,553 86.7 86.7 0.4 1.8 12.4
One Mall North 97,364 100.0 100.0 0.1 1.6
110 N. Wacker 226,000 100.0 100.0 1.5 6.1 22.7
2201 Lake Woodlands Drive 24,119 30.5 30.5
3831 Technology Forest Drive 95,078 100.0 100.0 0.5 2.0 22.4
3 Waterway Square 232,021 100.0 100.0 1.8 6.7 51.6
4 Waterway Square 218,551 100.0 100.0 1.7 6.5 36.2
1400 Woodloch Forest 95,667 93.5   93.5     0.4     1.7  
Total Office - Stabilized 2,787,662 94.5 % 94.8 % $ 14.6 $ 58.8 $ 398.1
 
Multi-family
The Metropolitan Downtown Columbia (d) 380 92.6 % 93.7 % 0.7 3.5 35.0
Millennium Waterway Apartments 393 83.0 81.2 0.9 4.5 55.6
Millennium Six Pines Apartments 314 85.7 82.8 1.0 4.6 42.5
85 South Street 21 95.5   95.5   $ 0.1   $ 0.6 $
Total Multi-family 1,108 87.3 % 86.2 % $ 2.7 $ 13.2 $ 133.1
 
Hospitality (e)
33 Peck Slip (d) 72 89.6 % 89.6 % $ 0.2 $ 0.4 $
The Woodlands Resort & Conference Center 406 48.9   48.9     1.9     16.5   70.0
Total Hospitality - Stabilized 478 55.0 % 55.0 % $ 2.1 $ 16.9 $ 70.0
 
Total Commercial Properties - Stabilized $ 28.0   $ 128.2 $ 949.2
 
Commercial Properties - Recently Developed And Not Yet Stabilized
 
Retail
Columbia Regional Building 88,556 77.4 % 100.0 % $ 0.4 $ 2.2 $ 22.2
Creekside Village Green 74,669 84.5 84.5 0.4 1.9
Downtown Summerlin 796,443 84.5 86.9 4.4 26.3 303.0
Lakeland Village Center at Bridgeland 83,600 36.3   53.7     0.1     1.7   10.0
Total Retail - Not Stabilized 1,043,268 80.0 % 85.2 % $ 5.3 $ 32.1 $ 335.2
 
Office
Three Hughes Landing 321,000 10.0 % 20.0 % (0.1 ) 7.6 35.1
1725 Hughes Landing Boulevard 333,754 48.8 64.3 0.4 6.9 52.8
ONE Summerlin 206,279 62.5   68.3   $ 0.8   $ 5.7 $
Total Office - Not Stabilized 861,033 37.6 % 48.7 % $ 1.1 $ 20.2 $ 87.9
 
Multi-family
Constellation (d) 124 51.6 % 66.1 % $ (0.1 ) $ 1.1 $ 6.9
One Lakes Edge 390 69.2   79.2     1.0     7.5   68.9
Total Multi-family - Not Stabilized 514 65.0 % 76.0 % $ 0.9 $ 8.6 $ 75.8
 
Hospitality (e)
Embassy Suites at Hughes Landing 205 67.7 % 67.7 % $ 1.1 $ 4.5 $ 29.5
The Westin at The Woodlands 302 46.2   46.2     1.2     10.5   58.1
Total Hospitality - Not Stabilized 507 54.9 % 54.9 % $ 2.3 $ 15.0 $ 87.6
 
Other
Other Assets (e) N/A N/A   N/A   $ 1.2   $ 4.8 $ 2.1
Total Other - Stabilized N/A N/A % N/A % $ 1.2 $ 4.8 $ 2.1
 
Total Commercial Properties - Not Stabilized $ 10.8   $ 80.7 $ 588.6
 
           
(In millions, except square feet/number of units and %)

Square Feet/Number of Units

% Occupied % Leased

NOI for the

Three Months Ended December 31, 2016

Projected Annual Stabilized NOI

Debt Balance as of December 31, 2016
Commercial Properties - Pending Redevelopment
 
Retail
Landmark Mall 440,325 31.1 % 31.1 % $ (0.1 ) $ N/A $
Total Retail - Pending Redevelopment 440,325 31.1 % 31.1 (0.1 ) $ N/A $
 
Office
American City Building 117,098 1.8 % 1.8 % $ N/A   $ N/A $
Total Office - Pending Redevelopment 117,098 1.8 % 1.8 % $ N/A $ N/A $
 
Total Commercial Properties - Pending Redevelopment $ (0.1 ) $ $
 
Under Construction or Renovation
 
Retail
South Street Seaport 362,000 94.9   94.9   $ 0.1   $ N/A $
Total Retail - Under Construction 362,000 94.9 % 94.9 % $ 0.1 $ N/A $
 
Office
100 Fellowship Drive 203,000 N/A 100.0 % $ N/A $ 5.1 $
One Merriweather 199,000 42.0 42.0 N/A 5.1 23.6
Two Merriweather 130,000 N/A   75.0     N/A     3.6  
Total Office - Under Construction 532,000 N/A % 72.2 % $ N/A $ 13.8 $ 23.6
 
Multi-family
Creekside Apartments 292 N/A N/A N/A 3.5
m.flats/TEN.M 437 N/A   N/A     N/A     4.0  
Total Multi-family - Under Construction 729 N/A % N/A % $ N/A $ 7.5 $
 
Self Storage
HHC 242 Self Storage Facility 654 N/A N/A $ N/A $ 0.8 $ 3.7
HHC 2978 Self Storage Facility 784 N/A   N/A     N/A     0.8   1.7
Total Self Storage - Under Construction 1,438 N/A % N/A % $ N/A $ 1.6 $ 5.4
 
Total Commercial Properties - Under Construction $ 0.1   $ 22.9 $ 29.0
             
Total Commercial Properties $ 38.9   $ 231.8 $ 1,566.8
 
(a) Stabilized NOI is the greater of actual trailing 12 month NOI or NOI calculated by using actual in-place rent on leased space and pro-forma rent on unleased space, adjusted for a market vacancy factor.
(b) Ward Village is under development and actual NOI includes both tenants for the newly developed assets and tenants for the historical assets. Projected Annual Stabilized NOI is based on all new assets being fully developed.
(c) Excludes American City Building as it is reflected in the Commercial Properties – Pending Redevelopment section below.
(d) Property is an equity method investment. NOI and debt balances represent our share of the equity method investments NOI and debt.
(e) Hospitality occupancy is the average occupancy for the quarter based on occupied rooms relative to total available rooms.

Contacts

The Howard Hughes Corporation
David R. O’Reilly, 214-741-7744
Chief Financial Officer
David.OReilly@howardhughes.com

Recent Stories

RSS feed for The Howard Hughes Corporation

The Howard Hughes Corporation