Hudson Pacific Properties, Inc. |
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Hudson Pacific Properties, L.P. |
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(State or other jurisdiction |
(Commission |
(IRS Employer | ||||
of incorporation) |
File Number) |
Identification No.) |
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(Address of Principal Executive Offices) |
(Zip Code) |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Registrant |
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered | |||
Hudson Pacific Properties, Inc. |
Company’s Share (1) |
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Tenant (2) |
Total Occupied Square Feet |
Total Occupied Square Feet |
Percent of Rentable Square Feet |
Annualized Base Rent (3) |
Percent of Annualized Base Rent |
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Google, Inc. |
640,726 | 622,117 | 4.9 | % | $ | 48,521,102 | 8.6 | % | ||||||||||||
Netflix, Inc. |
722,305 | 368,376 | 2.9 | 24,035,884 | 4.2 | |||||||||||||||
Nutanix, Inc. |
439,406 | 439,406 | 3.5 | 18,503,384 | 3.3 | |||||||||||||||
Riot Games, Inc. |
284,037 | 284,037 | 2.2 | 17,864,002 | 3.2 | |||||||||||||||
Amazon |
746,386 | 473,433 | 3.7 | 14,981,924 | 2.6 | |||||||||||||||
Qualcomm |
376,817 | 376,817 | 3.0 | 14,940,041 | 2.6 | |||||||||||||||
Salesforce.com |
265,394 | 265,394 | 2.1 | 14,287,683 | 2.5 | |||||||||||||||
Square, Inc. |
469,056 | 257,981 | 2.0 | 13,267,953 | 2.3 |
Company’s Share (1) |
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Tenant (2) |
Total Occupied Square Feet |
Total Occupied Square Feet |
Percent of Rentable Square Feet |
Annualized Base Rent (3) |
Percent of Annualized Base Rent |
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Dell EMC Corporation |
311,795 | 311,795 | 2.5 | 12,430,309 | 2.2 | |||||||||||||||
Uber Technologies, Inc. |
325,445 | 178,995 | 1.4 | 9,644,556 | 1.7 | |||||||||||||||
NFL Enterprises |
167,606 | 167,606 | 1.3 | 8,447,342 | 1.5 | |||||||||||||||
WeWork Companies, Inc |
330,921 | 159,456 | 1.3 | 7,956,673 | 1.4 | |||||||||||||||
GitHub, Inc. |
92,450 | 92,450 | 0.7 | 6,751,168 | 1.2 | |||||||||||||||
Weil, Gotshal & Manges LLP |
76,278 | 76,278 | 0.6 | 5,747,762 | 1.0 | |||||||||||||||
PayPal Holdings, Inc. |
123,097 | 123,097 | 1.0 | 5,545,170 | 1.0 | |||||||||||||||
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TOTAL |
5,371,719 |
4,197,154 |
33.1 |
% |
$ |
222,924,953 |
39.3 |
% | ||||||||||||
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(1) | Company’s Share is calculated as the total amounts on a consolidated basis, in accordance with GAAP (where applicable), plus our company’s share of the amount from our company’s unconsolidated joint ventures (calculated based upon our company’s percentage ownership interest), minus our company’s partners’ share of the amount from our company’s consolidated joint ventures (calculated based upon the partners’ percentage ownership interests). Because we own some of our properties through significant joint ventures, we believe that presenting Company’s Share of certain measures provides investors with useful information regarding our financial condition and/or results of operations by accounting for our true economic interest in these joint ventures. In some cases, we exercise significant influence over, but do not control, the joint venture, in which case, GAAP requires us to account for the joint venture entity using the equity method of accounting, and we do not consolidate it for financial reporting purposes. In other cases, GAAP requires us to consolidate the joint venture even though our partner(s) owns a significant percentage interest. |
(2) | Presented in order of Company’s Share of annualized base rent. |
(3) | Annualized base rent is calculated by multiplying (i) base rental payments (defined as cash base rents (before abatements or deferments)) under commenced leases as of September 30, 2021, by (ii) 12. Annualized base rent does not reflect tenant reimbursements. |
Company’s Share (1) |
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Industry |
Total Square Feet (2)(3) |
Annualized Base Rent as Percent of Total (4) |
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Technology (5) |
4,156,879 | 39.3 | % | |||||
Media & Entertainment (6) |
1,332,070 | 14.1 | ||||||
Legal |
653,904 | 8.5 | ||||||
Business Services |
885,931 | 8.3 | ||||||
Financial Services |
813,792 | 7.8 | ||||||
Retail |
946,666 | 5.8 | ||||||
Other |
1,652,243 | 16.2 | ||||||
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TOTAL |
10,441,485 |
100.0 |
% | |||||
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(1) | Company’s Share is calculated as the total amounts on a consolidated basis, in accordance with GAAP (where applicable), plus our company’s share of the amount from our company’s unconsolidated joint ventures (calculated based upon our company’s percentage ownership interest), minus our company’s partners’ share of the amount from our company’s consolidated joint ventures (calculated based upon the partners’ percentage ownership interests). |
(2) | Excludes signed leases not commenced. |
(3) | Excludes 181,792 square feet occupied by Hudson Pacific Properties, Inc. |
(4) | Annualized base rent is calculated by multiplying (i) base rental payments (defined as cash base rents (before abatements or deferments)) under commenced leases as of September 30, 2021, by (ii) 12. Annualized base rent does not reflect tenant reimbursements. |
(5) | Our diverse set of technology tenants largely consist of public and other well established companies. As a percentage of annualized base rent, the businesses of our technology tenants consist of online services (31%), software (28%), hardware & tech equipment (19%), business support services (12%) and other (10%). In addition, only 7% of annualized base rent of technology tenants as a percent of total annualized base rent of technology tenants are attributable to private companies in business for less than 10 years. Furthermore, only five tenants contribute more than 5% of annualized base rent of our technology tenants: Google, Nutanix, Qualcomm, Salesforce and Square, and over half of the annualized base rent of our technology tenants is comprised of tenants contributing less than 5% to the annualized base rent of our technology tenants. |
(6) | As a percentage of annualized base rent, the businesses of our media & entertainment tenants consist of production & service (62%), gaming (29%), advertising & marketing (7%) and other (2%). |
Company’s Share (1) |
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Market |
Total Square Feet (2) |
Annualized Base Rent (3) |
Annualized Rent as of Percent of Total |
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Office: |
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Silicon Valley |
6,438,644 | $ | 293,968,845 | 50.0 | % | |||||||
Los Angeles |
4,877,066 | 102,842,644 | 17.4 | |||||||||
Seattle |
2,703,452 | 49,458,077 | 8.4 | |||||||||
San Francisco |
2,561,358 | 111,092,692 | 18.9 | |||||||||
Vancouver |
1,945,738 | 8,389,521 | 1.4 | |||||||||
Studio: |
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Los Angeles |
1,465,403 | 22,669,820 | 3.9 | |||||||||
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TOTAL |
19,991,661 |
$ |
588,421,599 |
100.0 |
% | |||||||
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(1) | Company’s Share is calculated as the total amounts on a consolidated basis, in accordance with GAAP (where applicable), plus our company’s share of the amount from our company’s unconsolidated joint ventures (calculated based upon our company’s percentage ownership interest), minus our company’s partners’ share of the amount from our company’s consolidated joint ventures (calculated based upon the partners’ percentage ownership interests). |
(2) | Includes land. |
(3) | Annualized base rent for the office properties is calculated by multiplying (i) base rental payments (defined as cash base rents (before abatements or deferments)) under commenced leases as of September 30, 2021, by (ii) 12. Annualized base rent for the studio properties reflects actual base rent for the 12 months ended September 30, 2021. Annualized base rent does not reflect tenant reimbursements. |
Market |
Percent Leased at Acquisition Date |
Percent Leased at September 30, 2021 (1) |
Annualized Base Rent (2) atAcquisition Date per square foot |
Annualized Base Rent at September 30, 2021 per square foot |
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Office: |
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Silicon Valley |
85.7 | % | 87.5 | % | $ | 41.15 | $ | 56.95 | ||||||||
Seattle |
84.8 | 90.1 | 26.80 | 33.39 |
Market |
Percent Leased at Acquisition Date |
Percent Leased at September 30, 2021 (1) |
Annualized Base Rent (2) atAcquisition Date per square foot |
Annualized Base Rent at September 30, 2021 per square foot |
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San Francisco |
83.0 | 93.8 | 30.53 | 61.30 | ||||||||||||
Los Angeles |
37.7 | 94.6 | 35.40 | 56.13 |
(1) | Does not include signed leases not commenced. |
(2) | Annualized base rent for office properties is calculated by multiplying (i) base rental payments (defined as cash base rents (before abatements or deferments)) under commenced leases as of September 30, 2021, by (ii) 12. Annualized base rent per square foot for the office properties is calculated as (i) annualized base rent divided by (ii) square footage under commenced leases as of September 30, 2021. Annualized base rent does not reflect tenant reimbursements. |
Net Debt & Total Unsecured / Secured Debt ($ in Thousands) |
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Q2 2010 |
Q4 2010 |
Q4 2011 |
Q4 2012 |
Q4 2013 |
Q4 2014 |
Q4 2015 |
Q4 2016 |
Q4 2017 |
Q4 2018 |
Q4 2019 |
Q4 2020 |
Q3 2021 |
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Total unsecured and secured debt, net |
$ |
94,020 |
$ |
342,060 |
$ |
399,871 |
$ |
582,085 |
$ |
931,308 |
$ |
918,059 |
$ |
2,260,716 |
$ |
2,688,010 |
$ |
2,421,380 |
$ |
2,623,835 |
$ |
2,817,910 |
$ |
3,399,492 |
$ |
3,910,405 |
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Unamortized deferred financing cost |
— |
— |
— |
— |
— |
— |
19,039 |
19,829 |
17,209 |
15,898 |
26,235 |
31,599 |
32,480 |
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Unamortized loan discount/ (premium), net |
280 |
(643 |
) |
(1,965 |
) |
(1,201 |
) |
(5,320 |
) |
(3,056 |
) |
(1,310 |
) |
— |
722 |
648 |
1,314 |
1,185 |
1,088 |
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Debt related to held for sale property |
— |
— |
— |
— |
— |
42,449 |
— |
— |
— |
— |
— |
— |
— |
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Company’s share of unconsolidated joint venture debt |
— |
— |
— |
— |
— |
— |
— |
— |
— |
— |
97,053 |
99,973 |
102,722 |
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Partner’s share of consolidated debt |
— |
(51,940 |
) |
— |
(2,257 |
) |
(76,139 |
) |
(75,747 |
) |
(75,330 |
) |
(121,050 |
) |
(45,450 |
) |
(45,450 |
) |
(46,862 |
) |
(654,403 |
) |
(780,945 |
) | ||||||||||||||||||||||||||||
Total unsecured and secured debt |
$ |
94,300 |
289,477 |
$ |
397,906 |
$ |
578,627 |
$ |
849,849 |
$ |
881,705 |
$ |
2,203,115 |
$ |
2,586,789 |
$ |
2,393,861 |
$ |
2,594,931 |
$ |
2,895,650 |
$ |
2,877,846 |
$ |
3,265,750 |
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Q2 2010 |
Q4 2010 |
Q4 2011 |
Q4 2012 |
Q4 2013 |
Q4 2014 |
Q4 2015 |
Q4 2016 |
Q4 2017 |
Q4 2018 |
Q4 2019 |
Q4 2020 |
Q3 2021 |
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Cash and cash equivalents |
$ |
84,509 |
$ |
48,875 |
$ |
13,705 |
$ |
18,904 |
$ |
30,356 |
$ |
17,753 |
$ |
53,551 |
$ |
83,015 |
$ |
78,922 |
$ |
53,740 |
$ |
46,224 |
$ |
113,686 |
$ |
110,500 |
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Company’s share of unconsolidated real estate entity cash and cash equivalents |
— |
— |
— |
— |
— |
— |
— |
— |
— |
— |
2,690 |
(3,060 |
) |
(11,359 |
) | |||||||||||||||||||||||||||||||||||||
Partner’s share of cash and cash equivalents |
— |
(2,030 |
) |
— |
(1 |
) |
(1,865 |
) |
(1,664 |
) |
(3,251 |
) |
(9,285 |
) |
(1,594 |
) |
(7,659 |
) |
(8,846 |
) |
(17,002 |
) |
(31,269 |
) | ||||||||||||||||||||||||||||
Company’s share of net debt |
$ |
9,791 |
$ |
242,632 |
$ |
384,201 |
$ |
559,724 |
$ |
821,358 |
$ |
865,616 |
$ |
2,152,815 |
$ |
2,513,059 |
$ |
2,316,533 |
$ |
2,548,850 |
$ |
2,855,582 |
$ |
2,778,102 |
$ |
3,175,160 |
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Q2 2010 |
Q4 2010 |
Q4 2011 |
Q4 2012 |
Q4 2013 |
Q4 2014 |
Q4 2015 |
Q4 2016 |
Q4 2017 |
Q4 2018 |
Q4 2019 |
Q4 2020 |
Q3 2021 |
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Unsecured debt |
— |
$ |
111,117 |
— |
$ |
55,000 |
$ |
155,000 |
$ |
280,000 |
$ |
1,555,000 |
$ |
2,025,000 |
$ |
1,975,000 |
$ |
2,275,000 |
$ |
2,475,000 |
$ |
1,925,000 |
$ |
2,225,000 |
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Secured debt |
$ |
94,300 |
178,360 |
397,906 |
523,627 |
694,849 |
601,705 |
648,115 |
561,789 |
418,861 |
319,931 |
420,650 |
952,846 |
1,040,750 |
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Total company’s share of debt |
$ |
94,300 |
$ |
289,477 |
$ |
397,906 |
$ |
578,627 |
$ |
849,849 |
$ |
881,705 |
$ |
2,203,115 |
$ |
2,586,789 |
$ |
2,393,861 |
$ |
2,594,931 |
$ |
2,895,650 |
$ |
2,877,846 |
$ |
3,265,750 |
The following table presents and reconciles the Company’s Share of gross assets for the periods presented (in thousands). |
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Gross Asset Value ($ in Thousands) |
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Q2 2010 |
Q4 2010 |
Q4 2011 |
Q4 2012 |
Q4 2013 |
Q4 2014 |
Q4 2015 |
Q4 2016 |
Q4 2017 |
Q4 2018 |
Q4 2019 |
Q4 2020 |
Q3 2021 |
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Total Assets, net |
$ | 621,780 | $ | 1,004,576 | $ | 1,152,791 | $ | 1,559,690 | $ | 2,131,274 | $ | 2,340,885 | $ | 6,254,035 | $ | 6,678,998 | $ | 6,622,070 | $ | 7,070,879 | $ | 7,466,568 | $ | 8,350,202 | $ | 8,803,997 | ||||||||||||||||||||||||||
Accumulated depreciation |
21,442 | 27,113 | 53,329 | 85,184 | 116,342 | 134,657 | 269,074 | 419,368 | 533,498 | 695,631 | 898,279 | 1,102,748 | 1,285,137 | |||||||||||||||||||||||||||||||||||||||
Accumulated depreciation related to held for sale |
— | — | — | — | — | 7,904 | 3,650 | 4,582 | 15,913 | — | — | — | — | |||||||||||||||||||||||||||||||||||||||
Partner’s share of gross assets |
— | (94,606 | ) | — | (3,897 | ) | (127,795 | ) | (128,740 | ) | (194,809 | ) | (289,075 | ) | (163,559 | ) | (406,815 | ) | (453,722 | ) | (1,421,834 | ) | (1,526,056 | ) | ||||||||||||||||||||||||||||
Company’s share of depreciation of the unconsolidated |
— | — | — | — | — | — | — | — | — | — | 976 | 1,197 | 768 | |||||||||||||||||||||||||||||||||||||||
Company’s Share of Gross Assets |
$ |
643,222 |
$ |
937,083 |
$ |
1,206,120 |
$ |
1,640,977 |
$ |
2,119,821 |
$ |
2,354,706 |
$ |
6,331,950 |
$ |
6,813,873 |
$ |
7,007,922 |
$ |
7,359,695 |
$ |
7,912,101 |
$ |
8,032,313 |
$ |
8,563,846 |
Year Ended December 31, |
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2011 |
2020 |
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Net income |
$ | (2,238 | ) | $ | 16,430 | |||
Adjustments: |
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Depreciation and amortization—Consolidated |
44,660 | 299,682 | ||||||
Depreciation and amortization—Corporate-related |
— | (2,286 | ) | |||||
Depreciation and amortization—Company’s share from unconsolidated real estate investments |
— | 5,605 | ||||||
Gain on sale of real estate |
— | — | ||||||
Impairment loss |
— | — | ||||||
Unrealized loss on non-real estate investments |
— | 2,463 | ||||||
FFO attributable to non-controlling interests |
(1,297 | ) | (37,644 | ) | ||||
FFO attributable to preferred stock and units |
(8,108 | ) | (612 | ) | ||||
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FFO to common stockholders and unitholders |
$ |
33,017 |
$ |
283,638 |
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Specified items impacting FFO: |
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Transaction-related expenses |
1,693 | 440 | ||||||
One-time tax reassessment management cost |
— | 5,500 | ||||||
One-time straight line rent reserve |
— | 2,620 | ||||||
One-time prior period property tax adjustment |
— | (937 | ) | |||||
One-time debt extinguishment cost |
— | 2,654 | ||||||
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FFO (excluding specified items) to common stockholders and unitholders |
$ |
34,710 |
$ |
293,915 |
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|
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|
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Weighted average common stock/units outstanding—diluted |
32,004 | 154,084 | ||||||
FFO per common stock/unit—diluted |
1.03 | 1.84 | ||||||
FFO (excluding specified items) per common stock/unit—diluted |
1.08 | 1.91 |
Hudson Pacific Properties, Inc. | ||
By: | /s/ Mark T. Lammas | |
Mark T. Lammas | ||
President |
Hudson Pacific Properties, L.P. | ||
By: | Hudson Pacific Properties, Inc. | |
Its General Partner | ||
By: | /s/ Mark T. Lammas | |
Mark T. Lammas | ||
President |