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Dec 31, 2023
Howard Hughes Q4 2022 Earnings Report
Howard Hughes reported solid fourth quarter and full-year 2022 results, with strong performance across all segments, including record condo sales and residential land prices.
Key Takeaways
The Howard Hughes Corporation reported a net income of $52.8 million for the fourth quarter of 2022, with diluted EPS of $1.07. Full-year net income reached $184.5 million, or $3.65 per diluted share, driven by record condo sales and strong Master Planned Community earnings.
Net income per diluted share for Q4 2022 was $1.07, compared to $2.09 in the prior-year period.
MPC EBT totaled $77 million in Q4, driven by strong land sales and record quarterly residential price per acre sold.
Ward Village closed on 159 condo units, generating $217 million in net revenue in Q4.
The company closed on nearly $1 billion in financings, reducing maturities in 2023 and 2024 to $228 million.
Howard Hughes
Howard Hughes
Howard Hughes Revenue by Segment
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.com Forward Guidance
For 2023, The Howard Hughes Corporation anticipates a decline in MPC EBT, relatively flat Operating Assets NOI, and specific ranges for condo sales revenues and cash G&A, reflecting ongoing market uncertainties.
Positive Outlook
- Operating Assets NOI is projected to benefit from multi-family rent growth and new developments encompassing nearly 1,400 units.
- The office portfolio is expected to benefit from strong leasing momentum experienced throughout 2022.
- Victoria Place, a major condo project, is on track to be delivered in early 2024 and is already 100% pre-sold.
- The company's unmatched landbank in highly desirable communities and exceptional portfolio of assets position it well for future growth.
- Robust balance sheet with over $1.3 billion in recent financings uniquely positions the company to advance new developments.
Challenges Ahead
- MPC EBT is expected to decline 25% to 35% year-over-year due to a slowing housing market, rising mortgage rates, and shrinking home affordability.
- Operating Assets NOI is expected to be in a range of down 2% to up 2% year-over-year, excluding divested retail assets.
- Office NOI is likely to see a modest year-over-year decline due to free rent periods on new leases and the impact of tenant vacancies in 2022.
- Condo sales revenues are projected to range between $45 million and $55 million, driven by remaining units at 'A'ali'i and Kōʻula.
- Cash G&A is projected to range between $80 million and $85 million, excluding anticipated non-cash stock compensation.