Hudson Pacific Properties, Inc. reported a net loss of $381.4 million for the fiscal year ending December 31, 2024, a significant increase of 123% compared to a net loss of $170.7 million in the previous year. The company's financial performance was impacted by a decrease in net operating income (NOI), which fell by 22.7% to $388 million, down from $501.8 million in 2023. This decline was primarily attributed to lower occupancy rates and rental revenues, particularly in the office segment, which saw a decrease of $52.3 million in rental income due to lease expirations and a transition to cash basis reporting for certain tenants.
In terms of operational metrics, Hudson Pacific's in-service office portfolio was 78.9% leased as of December 31, 2024, a decline from 82.9% in the previous year. The studio properties also faced challenges, with an average occupancy rate of 73.8% for the same period. The company did not engage in any property acquisitions during 2024 but sold its 3176 Porter Drive property for $24.8 million. Additionally, two properties were classified as held for sale, indicating a strategic shift in asset management.
The company’s strategic focus remains on high-quality office and studio properties in key markets, including Los Angeles, San Francisco, Seattle, New York, and Vancouver. As of the end of 2024, Hudson Pacific's portfolio included approximately 14.6 million square feet of office space and 1.7 million square feet of studio space. The company is also pursuing several development projects, including the Sunset Pier 94 Studios in New York, which is expected to add 232,000 square feet upon completion in late 2025.
Looking ahead, Hudson Pacific has suspended its common stock dividend to address liquidity concerns amid ongoing challenges in the office and studio markets, particularly following the strikes in the media industry. The company plans to reassess its dividend policy in the future based on market conditions and operational performance. The management remains focused on maintaining a conservative balance sheet while exploring opportunities for growth through strategic acquisitions and capital recycling.
About Hudson Pacific Properties, Inc.
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