Hudson Pacific Properties, Inc. reported significant financial challenges in its latest 10-Q filing for the quarter ending September 30, 2024. The company experienced a net loss of $107.0 million for Q3 2024, a substantial increase from a net loss of $35.8 million in Q3 2023. For the nine months ended September 30, 2024, the net loss reached $207.9 million, compared to $82.0 million for the same period in the previous year, marking a 153.4% increase.
Total revenues for Q3 2024 were $200.4 million, down from $231.4 million in Q3 2023. Rental revenues specifically fell to $162.9 million from $199.6 million year-over-year. The decline in revenue was attributed to lease expirations, particularly in the San Francisco Bay Area, and a straight-line rent reserve for transitioning a tenant to cash basis reporting. The company's total office revenues also decreased to $166.9 million from $203.6 million in the prior year.
Operating expenses for Q3 2024 were $221.1 million, slightly down from $228.3 million in Q3 2023. However, general and administrative expenses rose to $19.5 million from $17.5 million, driven by lower capitalization of expenses and increased IT-related costs. The company recorded impairment losses of $36.5 million in Q3 2024, reflecting reduced estimated holding periods for certain office properties, with no such losses reported in the same quarter of 2023.
Hudson Pacific's investment in real estate at cost increased to $8.3 billion as of September 30, 2024, from $8.2 billion at the end of 2023. However, cash and cash equivalents decreased to $90.7 million from $100.4 million during the same period. Total assets rose to $8.3 billion, while total liabilities increased to $5.0 billion, resulting in stockholders' equity declining to $3.0 billion.
Strategically, the company did not make any acquisitions during the nine months ended September 30, 2024, and has classified its Foothill Research Center property as held for sale, indicating a shift in focus towards optimizing its portfolio. The company also suspended its quarterly common stock dividend in September 2024, reflecting its ongoing financial challenges.
Overall, Hudson Pacific Properties, Inc. is navigating a difficult market environment, with declining revenues and increasing losses, while also making strategic adjustments to its asset portfolio.
About Hudson Pacific Properties, Inc.
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