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Mar 31, 2024
Howard Hughes Q1 2024 Earnings Report
Howard Hughes Holdings Inc. reported a net loss of $52.5 million for the first quarter of 2024, primarily due to reduced commercial land sales, lower equity earnings from The Summit, and increased G&A expenses.
Key Takeaways
Howard Hughes Holdings Inc. reported a net loss of $52.5 million for Q1 2024, or $(1.06) per diluted share, compared to a net loss of $22.7 million, or $(0.46) per diluted share, in the prior-year period. Total revenues were $171.1 million. Operating Assets NOI increased 7% year-over-year to $63.5 million, driven by improved performance in office and multi-family segments. New home sales in HHH's communities increased 24% sequentially to 654 units, indicating strong demand for residential land sales.
Net loss per diluted share was $(1.06), primarily due to reduced commercial land sales, lower equity earnings from The Summit, and increased G&A expenses related to the anticipated spinoff of Seaport Entertainment.
Total Operating Assets NOI increased 7% year-over-year to $63.5 million, with strong performance in office and multi-family portfolios.
New home sales in HHH's communities increased 24% sequentially to 654 units, signaling strong demand for residential land sales in coming quarters.
The company launched pre-sales at The Ritz-Carlton Residences, The Woodlands, pre-selling over 50% of available inventory for approximately $250 million in future revenue in just one week.
Howard Hughes
Howard Hughes
Howard Hughes Revenue by Segment
Howard Hughes Revenue by Geographic Location
Revenue by Segment
Condominium Rights & Unit Sales Revenue
CapyFin.comMPC Land Sales Revenue
CapyFin.comRental Revenue
CapyFin.comOther Land, Rental & Property Revenue
CapyFin.comBuilder Price Participation Revenue
CapyFin.comRevenue by Geographic Location
Houston, TX (Office) Revenue
CapyFin.comColumbia, MD (Office) Revenue
CapyFin.comLas Vegas, NV (Office) Revenue
CapyFin.comHonolulu, HI (Retail) Revenue
CapyFin.com Forward Guidance
Full-year 2024 guidance remains unchanged, with robust MPC EBT projected at $300 million, Operating Assets NOI at $250 million, and condo sales between $675 million and $725 million with gross margins of 28% to 30%.
Positive Outlook
- MPC EBT is projected to be robust, aided by stable mortgage rates and tight supply of existing homes.
- New home sales in Summerlin, Bridgeland, and The Woodlands Hills are expected to be strong, driving homebuilder demand for residential land.
- First land sales in Floreo (Teravalis) are expected to contribute incremental equity earnings.
- Operating Assets NOI is projected to benefit from increased occupancy at new multi-family developments and improved retail leasing.
- Condo sales revenues are projected to be strong, driven by the closing of units at Victoria Place, which is 100% pre-sold.
Challenges Ahead
- Reduced EBT associated with exceptional commercial land sales and builder price participation during 2023 will offset some gains.
- Reduced inventory of custom lots available to sell at Aria Isle in The Woodlands and The Summit in Summerlin.
- Office NOI is expected to be relatively flat year-over-year due to free rent periods on new leases and the impact of tenant vacancies and new office developments.
- Approximately $75 million of condo sales revenues for Victoria Place are expected to occur in Q1 2025 due to timing of 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.