Hudson Pacific Properties, Inc. BofA NY Global Real Estate Conference 2026

Thank you for having us. It's always a pleasure to attend this conference. It's an interesting time for Hudson. We've come out of, I think, much more of a challenging window into a much more of a positive window. For those of you who are less familiar with the story, I'll give you a brief update as to who we are. We're a leading owner and operator and developer of top-tier office real estate across our high barrier markets on the West Coast, which includes San Francisco, Los Angeles, Seattle, and Vancouver. We also run a studio platform that's unique among public companies. We're the only REIT that has a studio platform in it, and we're the largest independent studio owner and operator in Los Angeles, and we have a relatively new studio that we opened a year ago almost here in New York.

As of Q2, our portfolio has about 46 properties in it, combined about almost 14.5 million square feet. High quality tenant base, investment grade, blue chip companies, and about 50/50 mix of tech and AI on one side, and inclusive of media and then diversified fire-related tenants, including legal government, retail, financial business services, healthcare, et cetera. Our top tenants to the portfolio include, from no particular order, City and County of San Francisco, which we just signed almost a 1 million square foot lease with, Google, Netflix, Amazon, and then a whole host of other tech and tech related media and related companies. Today, the story's really been consistent. In the last 10 months we've talked about, throughout our earnings calls and throughout our projections of the company, where we were and where we're going.

We were at one point in late 2019, a 92% lease company, and we went all the way down to 75%, and we said by the end of this year, we have an eight handle. We're already at 82%. We expect to be at 85%. By the end of 2027, we expect to be back up to 90%+. The year so far for us has been record in leasing. We had our largest leasing quarter last quarter at 1.3 million square feet, and we are looking at sort of our same-store cash NOI growth right now from an NOI grew to 7.5% and our Core FFO also grew up 30%.

As we sit today, one of the office companies that all of us have gone through different times and challenging times, but from our standpoint, we have the largest growth potential and we are proving it out quarter over quarter. Every market that we are in on the office side, we are ahead on leasing, we are ahead on all fundamentals, in every single market with the exception of North San Jose, which we are about to go ahead to market after this quarter. On the studio side, we purchased a few companies. We slimmed those companies down. We were running a negative in those businesses at almost $20 million a year. We said by the end of this year, we would be at zero. We are on track for that. We have gone from 20 negative approximately down to $4 million negative.

Given the current composure of the studio business, which we can get into and talk about, we just extended our loan that is expiring, our Hollywood Media Portfolio loan, which is predominantly operated and tenanted with Netflix to an extension that was very beneficial to us and to the tenant. We are working through an extension on that tenant as we sit right now. I think overall, mindful that the company itself has gone through some rougher times. The wind has definitely turned to our back. We have capital today of almost $900 million of untapped credit facility interest. Our interest expense is lower by almost 20%, and we have about $200 million of dispositions in the company right now. With that, I think I will send it over to you, Jana, and we can go into some questions.

Sure. I will start and then Art can jump in. I think the first theme is that what we are seeing is a consistent flow of tours which correlate into interest level, then correlates into LOIs and then to leases. Our pipeline right now is about 2.4 million sq ft. We have consistently gone at 500,000 sq ft a quarter. As you mentioned, I said earlier in my comments, 1.3 million sq ft last quarter. We have a couple of large deals that we are working on right now, but our core really throughout the whole portfolio is our average size, 20,000-30,000 sq ft tenants. Interestingly enough, in the portfolio trending is the term of the leases have gone up. They were really hovering in the high 40 months range, and we are over 63 months now. Concessions are constant. We have not seen any spike in that.

Obviously with cost of tenant improvements have gone up like everybody else, but not insurmountable, and lease terms are offsetting that. More importantly, our mark to market rents are all trending in the right direction, which is above market. We seem to be at a pretty good space, clearly in the Bay Area. We have the most activity we've had, I think, in the history of the company. But now that's sort of falling onto some great activity in Seattle. We're starting to see that 18-month window that we said was different between the Bay Area and the Pacific Northwest, we're seeing that. I would say we're fortunate in Los Angeles. We're, I think 93% leased in Los Angeles or in our assets there in the office, but Los Angeles is much slower. The activity is really specific to few markets and asset quality only.

But overall, leasing has been a real surprise. I think we set some lofty goals, and we've achieved them and exceeded them.

Yeah. Directionally, we're in a great place. Victor Coleman mentioned we're close to 2.4 million feet of deals in the pipeline, which has maintained, certainly over the last three quarters. If you think about it, we had a quarter of 1.3 million square feet of gross leasing last quarter. We're still at close to 2.4 million feet. Why? Because the tour activity remains at peak levels for us. We're 2.1 million feet of tours a quarter, which is up 20% year over year. Again, it's those tours that are driving the activity into the pipeline and through the pipeline into execution. We've been seeing this for, I'd say, we've seen the momentum growing for some time now, but we've experienced it over the last four quarters. We have four quarters of positive absorption in our portfolio. We moved occupancy 740 basis points over the last year.

We're doing all the right things. We're executing on the ground. As the team continues to aggressively pursue the tour activity, I think we're going to see more of that growth into the future. Because over the next three years, expirations are at a reduced level, you're going to see more absorption in the years to come.

Yeah. The large expirations over the next, call it the next year and a half or so. We are about 75%-80% coverage, which means if it is a known vacate, we are in negotiations already to backfill the space. The largest of which going forward is Redfin at Hill7 in Seattle. They are 112,000 sq ft. They are downsizing in half. We are in negotiations at Hill7 to keep them or at Washington 1000. So one way or the other, we are going to keep their tenancy at 50,000 sq ft. The large expirations coming up in San Francisco, which is Twilio Inc. at the end of the year, which is 83,000 sq ft, and Salesforce, Inc. in April of 2027, which is also 83,000 sq ft, which are full floors at Rincon Center. We are 100% covered. We are in late stage negotiations with the tenant right now for those spaces.