Hudson Pacific Properties, Inc.
For the period ended Jun 30, 2025. Filed Aug 7, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Aug 7, 2025
HPP$8.49-3.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-05-08.
0001482512-25-000043
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-08-07.
0001482512-25-000126
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 204 previous paragraphs and 262 current paragraphs.
145 unchanged; 41 reworded; 57 added; 17 removed; 1 previous and 19 current paragraphs rearranged.
Tables are not compared: 17 previous and 22 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (57)
Current report
During the six months ended June 30, 2025, the Company sold in an underwritten public offering 237,553,442 shares of common stock and pre-funded warrants to purchase 71,863,597 shares of common stock. The gross proceeds from the offering amounted to $689.3 million.
Current report
•a decrease in office NOI of $12.4 million primarily due to:
Current report
•a $2.0 million increase in service and other revenues due to a lease termination fee received at our 6040 Sunset property.
Current report
•a decrease in office NOI of $4.0 million resulting from the sales of our 3176 Porter property in 2024 and our Foothill Research, Maxwell and 625 Second properties in 2025.
Current report
•a decrease in studio NOI of $3.7 million primarily due to:
Current report
•a $0.6 million increase in studio operating expenses primarily due to operating expenses incurred at Sunset Glenoaks Studios, which was completed and placed in service during the second quarter of 2024, partially offset by lower stage and transportation utilization at Quixote.
Current report
Other (Expenses) Income
Current report
Capitalized interest decreased by $0.6 million or 5.9%, to $10.3 million for the three months ended June 30, 2025 compared to $10.9 million for the three months ended June 30, 2024 primarily due to the completion of the Sunset Glenoaks Studios development during the three months ended June 30, 2025. The decrease was partially offset by development activity at Washington 1000, Sunset Waltham Cross Studios, Sunset Las Palmas Studios and Sunset Pier 94 Studios.
Current report
Non-cash interest expense increased by $3.3 million, or 164.4%, to $5.3 million for the three months ended June 30, 2025 compared to $2.0 million for the three months ended June 30, 2024. The increase was primarily related to the amortization of cash premiums paid to obtain new interest rate caps during the three months ended June 30, 2025.
Current report
Interest income increased by $1.5 million, or 266.7%, to $2.1 million for the three months ended June 30, 2025 compared to $0.6 million for the three months ended June 30, 2024. The increase was primarily driven by an increase in cash deposits in interest-bearing accounts and interest income earned on employee retention credit tax refunds received in the second quarter of 2025.
Current report
Transaction-related expenses increased by $0.6 million, or 499.1%, to $0.5 million of expense for the three months ended June 30, 2025 compared to $0.1 million of income for the three months ended June 30, 2024. The increase was primarily related to legal expenses incurred in connection with early lease terminations at Quixote during the three months ended June 30, 2025.
Current report
Unrealized gain (loss) on non-real estate investments
Current report
During the three months ended June 30, 2025, we recognized a net loss on sale of $16 thousand attributable to the sale of our 625 Second property. No gain or loss on sale was recognized during the three months ended June 30, 2024.
Current report
Other (expense) income
Current report
During the three months ended June 30, 2025, we recognized other expense of $0.1 million. During the three months ended June 30, 2024 we recognized other income of $1.3 million related to the sale of a non-real estate investment.
Current report
Income tax provision
Current report
There was no significant change in the income tax provision. We recognized a provision of $0.5 million for the three months ended June 30, 2025 compared to $0.5 million for the three months ended June 30, 2024.
Current report
General and administrative expenses increased by $7.1 million, or 34.2%, to $27.8 million for the three months ended June 30, 2025 compared to $20.7 million for the three months ended June 30, 2024. The increase was primarily due to the accelerated recognition of $14.3 million of compensation expense related to the cancellation of the 2024 performance unit equity awards by the Company’s top three executive officers during the three months ended June 30, 2025, which was partially offset by the impact of Company-wide cost savings initiatives.
Current report
Depreciation and amortization expense increased by $8.0 million, or 9.2%, to $94.8 million for the three months ended June 30, 2025 compared to $86.8 million for the three months ended June 30, 2024. The increase was primarily related to the accelerated depreciation of tenant improvements related to early lease terminations at our 6040 Sunset and Quixote properties and disposals of transportation assets at Quixote during the three months ended June 30, 2025. The increase was partially offset by the sales of our 3176 Porter property in 2024 and our Foothill Research, Maxwell and 625 Second properties in 2025.
Current report
Comparison of the Six Months Ended June 30, 2025 to the Six Months Ended June 30, 2024
Current report
Net Loss
Current report
Net Operating Income
Current report
•Non-same-store, which includes:
Current report
•Stabilized non-same-store properties
Current report
•Lease-up properties
Current report
•Repositioning properties
Current report
•Development properties
Current report
•Redevelopment properties
Current report
•Held for sale properties
Current report
NOI decreased $41.6 million, or 19.9%, for the six months ended June 30, 2025 as compared to the six months ended June 30, 2024, primarily resulting from:
Current report
•a decrease in office NOI of $17.8 million primarily due to:
Current report
•a $22.0 million decrease in rental revenues driven by lease terminations at our 1455 Market, Concourse and 901 Market properties; and
Current report
•a $1.0 million increase in operating expenses due to higher utility, cleaning, security and repair and maintenance expenses at several properties, partially offset by a reduction in property taxes at our Seattle properties and lower insurance premiums across the portfolio; partially offset by
Current report
•a $5.2 million increase in service and other revenues due to lease termination fees received at our 6040 Sunset, Shorebreeze and Rincon Center properties.
Current report
•a decrease in studio NOI of $11.6 million primarily due to:
Current report
•a $6.8 million decrease in service and other revenues due to lower stage and production activity at Quixote; and
Current report
•a $5.1 million increase in studio operating expenses primarily due to one-time lease termination fees of $6.5 million associated with Quixote cost-cutting initiatives and operating expenses incurred at Sunset Glenoaks Studios, which was completed and placed in service during the second quarter of 2024, partially offset by lower stage and transportation utilization at Quixote.
Current report
Other (Expenses) Income
Current report
Fee income
Current report
Interest expense
Showing the first 40 of 57 passages. Open the source sections for the rest.
Removed paragraphs (17)
Previous report
West coast office fundamentals continue to strengthen, with our quarterly gross leasing achieving post-pandemic records, sublease availability improving and limited new supply, which is supported by further return-to-office momentum and billions of dollars of investment in artificial intelligence. Our studio business has experienced growing interest from new quality productions seeking multi-stage, multi-year leases. This demand could be expected to grow should the proposed California film and television tax credit increases be approved.
Previous report
We invest in Class-A office properties in west coast technology and media hubs, which allows us to attract and retain leading public and established private companies as tenants. As of March 31, 2025, public companies represented 52.9% of our tenant base and private companies with an age of greater than 10 years represented 40.4% of our tenant base, based on HPP’s share of ABR. Further, as of March 31, 2025, 75% of our public tenants and 40% of all of our tenants had an investment grade credit rating, based on HPP’s share of ABR. As of March 31, 2025, HPP’s share of the remaining weighted average lease term was 4.8 years.
Previous report
TDK Corporation of America/Invensense expirations at Concourse: (i) 86,534 square feet on April 30, 2025 and (ii) 52,802 square feet on April 30, 2033.
Previous report
Held for Sale
Previous report
As of March 31, 2025, the Company had one property classified as held for sale—625 Second—as this property was considered non-strategic to the Company’s portfolio. See Part I, Item 1 “Note 3 to the Consolidated Financial Statements—Investment in Real Estate” for more detail.
Previous report
•a $4.5 million increase in studio operating expenses primarily due to a one-time lease termination fee of $5.9 million associated with Quixote cost-cutting initiatives, which are expected to result in $14.2 million of annualized expense savings. The increase was further driven by operating expenses incurred at Sunset Glenoaks Studios, which was an unconsolidated property during the three months ended March 31, 2024 and a consolidated property during the three months ended March 31, 2025.
Previous report
•a decrease in office NOI of $6.2 million primarily due to:
Previous report
•a $1.2 million increase in operating expenses predominantly due to higher tax, utilities and insurance expenses at several properties in 2025.
Previous report
Other Income (Expenses)
Previous report
Includes interest on the Company’s debt and hedging activities.
Previous report
Includes the amortization of deferred financing costs and fair market value adjustments for our mark-to-market interest rate derivatives.
Previous report
Capitalized interest increased by $1.6 million or 18.8%, to $10.1 million for the three months ended March 31, 2025 compared to $8.5 million for the three months ended March 31, 2024. The increase was primarily driven by capitalized interest at Sunset Glenoaks Studios, which was not a consolidated property during the three months ended March 31, 2024 but was a consolidated property during the three months ended March 31, 2025.
Previous report
Non-cash interest expense increased by $2.5 million, or 132.8%, to $4.5 million for the three months ended March 31, 2025 compared to $1.9 million for the three months ended March 31, 2024. The increase in non-cash interest expense was primarily related to the amortization of an interest rate cap premium during the three months ended March 31, 2024.
Previous report
Interest income decreased by $0.4 million, or 49.1%, to $0.4 million for the three months ended March 31, 2025 compared to $0.9 million for the three months ended March 31, 2024. The decrease was primarily driven by a decrease in interest rates on cash deposits and interest-bearing accounts.
Previous report
Transaction-related expenses decreased by $2.2 million, or 100.0%, to $0 for the three months ended March 31, 2025 compared to $2.2 million for the three months ended March 31, 2024.The decrease was primarily related to dead deal costs incurred during the three months ended March 31, 2024.
Previous report
General and administrative expenses decreased by $1.2 million, or 6.2%, to $18.5 million for the three months ended March 31, 2025 compared to $19.7 million for the three months ended March 31, 2024. The decrease was primarily driven by lower travel and entertainment, information technology and shareholder relations during the three months ended March 31, 2025 as compared to the prior period.
Previous report
Depreciation and amortization expense increased by $1.2 million, or 1.3%, to $93.1 million for the three months ended March 31, 2025 compared to $91.9 million for the three months ended March 31, 2024. The increase was primarily related to the accelerated amortization of a non-competition agreement intangible asset upon the early termination of the agreement during the three months ended March 31, 2025.
Reworded paragraphs (41)
Previous wording
Through our interest in Hudson Pacific Properties, L.P. (our operating partnership) and its subsidiaries, at March 31, 2025, our portfolio of owned real estate included office properties comprising approximately 14.3 million square feet, studio properties comprising approximately 45 sound stages and 1.7 million square feet and land properties comprising approximately 3.2 million square feet of undeveloped density rights. Our production services assets include vehicles, lighting and grip, production supplies and other equipment and the lease rights to 20 sound stages.
Current wording
Through our interest in Hudson Pacific Properties, L.P. (our operating partnership) and its subsidiaries, at June 30, 2025, our portfolio of owned real estate included office properties comprising approximately 14.2 million square feet, studio properties comprising approximately 45 sound stages and 1.7 million square feet and land properties comprising approximately 3.2 million square feet of undeveloped density rights. Our production services assets include vehicles, lighting and grip, production supplies and other equipment and the lease rights to 20 sound stages.
Previous wording
As of March 31, 2025, our in-service office portfolio was 76.5% leased (including leases not yet commenced). Our same-store studio properties were 73.8% leased for the average percent leased for the 12 months ended March 31, 2025.
Current wording
As of June 30, 2025, our in-service office portfolio was 76.2% leased (including leases not yet commenced). Our same-store studio properties were 73.8% leased for the average percent leased for the 12 months ended June 30, 2025.
Previous wording
Same-store office for the three months ended March 31, 2025 defined as all properties owned and included in our stabilized office portfolio as of January 1, 2024 and still owned and included in the stabilized office portfolio as of March 31, 2025.
Current wording
Same-store office for the three months ended June 30, 2025 defined as all properties owned and included in our stabilized office portfolio as of April 1, 2024 and still owned and included in the stabilized office portfolio as of June 30, 2025. Since its acquisition as part of a portfolio in the second quarter of 2015, Metro Center has not reached stabilized occupancy (92%) so has never been included in the same-store office portfolio, instead remaining the only office asset within that portfolio still held as a non-same-store, lease-up property. In an effort to simplify our in-service and same-store disclosure, Metro Center will be included within our same-store office properties for both the three and six months ended June 30, 2024 and June 30, 2025.
Previous wording
Includes office properties that have not yet reached 92.0% occupancy since the date they were acquired as of March 31, 2025.
Current wording
Includes office properties that have not yet reached 92.0% occupancy since the date they were acquired as of June 30, 2025. Please see footnote 4 above regarding the treatment of Metro Center.
Previous wording
Salesforce.com expirations at Rincon Center: (i) 83,016 square feet on March 31, 2025 (backfilled by Twilio effective April 1, 2025), (ii) 83,372 square feet on April 30, 2027 and (iii) 99,006 square feet on October 31, 2028. Salesforce.com subleased 259,416 square feet at Rincon Center to Twilio Inc. in 2018 (83,016 square feet of which became a direct lease with Twilio effective April 1, 2025) and in 2020 began paying us 50% of cash rents received pursuant to the sublease, or an average of $340,000 per month with annual growth thereafter, in addition to contractual base rent.
Current wording
Salesforce.com expirations at Rincon Center: (i) 83,372 square feet on April 30, 2027 and (ii) 99,006 square feet on October 31, 2028. Salesforce.com currently subleases 182,378 feet at Rincon Center to Twilio Inc. and pays us 50% of cash rents received pursuant to the sublease at a current average of $280,000 per month with annual growth thereafter, in addition to contractual base rent.
Previous wording
PayPal, Inc. has an early termination right at Fourth & Traction in July 2026.
Current wording
PayPal, Inc. has exercised their early termination right at Fourth & Traction for July 2026.
Previous wording
We had no business acquisitions during the three months ended March 31, 2025.
Current wording
We had no business acquisitions during the six months ended June 30, 2025.
Previous wording
We had no property acquisitions during the three months ended March 31, 2025.
Current wording
We had no property acquisitions during the six months ended June 30, 2025.
Previous wording
During the three months ended March 31, 2025, the Company sold its Maxwell and Foothill Research Center properties for $46.0 million and $23.0 million, respectively. See Part I, Item 1 “Note 3 to the Consolidated Financial Statements—Investment in Real Estate” for details. A portion of the net proceeds of these sales was used to repay outstanding amounts on the unsecured revolving credit facility.
Current wording
During the six months ended June 30, 2025, the Company sold its Maxwell, Foothill Research Center and 625 Second properties for $46.0 million, $23.0 million and $28.0 million, respectively. See Part I, Item 1 “Note 3 to the Consolidated Financial Statements—Investment in Real Estate” for details. A portion of the net proceeds from these sales was used to repay outstanding amounts on the unsecured revolving credit facility.
Previous wording
The following table summarizes the lease expirations for leases in place as of March 31, 2025, plus available space, beginning January 1, 2025 at the properties in our office portfolio. We believe lower quarterly expirations starting in the second half of 2025 will provide an opportunity to stabilize occupancy with growth thereafter. Unless otherwise stated in the footnotes, the information set forth in the table assumes that tenants did not exercise any renewal options.
Current wording
The following table summarizes the lease expirations for leases in place as of June 30, 2025, plus available space, at the properties in our office portfolio. Unless otherwise stated in the footnotes, the information set forth in the table assumes that tenants did not exercise any renewal options.
Previous wording
Does not include 34 month-to-month leases.
Current wording
Does not include 33 month-to-month leases.
Previous wording
During the three months ended March 31, 2025, there were $297.0 million of repayments on the unsecured revolving credit facility, net of borrowings. The Company generally uses the unsecured revolving credit facility to finance the acquisition of properties and businesses, to provide funds for tenant improvements and capital expenditures and to provide for working capital and other corporate purposes.
Current wording
During the six months ended June 30, 2025, there were $320.0 million of repayments on the unsecured revolving credit facility, net of borrowings. The Company generally uses the unsecured revolving credit facility to finance the acquisition of properties and businesses, to provide funds for tenant improvements and capital expenditures and to provide for working capital and other corporate purposes.
Previous wording
During the three months ended March 31, 2025, the Company secured the Office Portfolio CMBS loan (a commercial mortgaged-backed securities loan) with an aggregate principal amount of $475.0 million. The loan is secured by six office properties and bears interest at SOFR + 3.76%. The Company used the proceeds from the loan to repay $259.0 million on its unsecured revolving credit facility and to repay the $168.0 million loan secured by the Element LA property. Subsequent to March 31, 2025, the Company entered into an interest rate swap agreement to fix SOFR at a rate of 3.4075% on $250.0 million and an interest rate cap agreement to cap SOFR at a rate of 3.35% on $224.2 million of the Office Portfolio CMBS loan
Current wording
During the six months ended June 30, 2025, the Company secured the Office Portfolio CMBS loan (a commercial mortgaged-backed securities loan) with an aggregate principal amount of $475.0 million. The loan is secured by six office properties and bears interest at SOFR + 3.76%. The Company used the proceeds from the loan to repay $259.0 million on its unsecured revolving credit facility and to repay the $168.0 million loan secured by the Element LA property.
Previous wording
During the three months ended March 31, 2025, the Company amended its unsecured revolving credit facility agreement to adjust certain definitions and covenant calculations beginning with the period ending December 31, 2024. The amendment also resulted in a decrease in the total capacity from $900.0 million to $775.0 million.
Current wording
During the six months ended June 30, 2025, the Company amended its unsecured revolving credit facility agreement to adjust certain definitions and covenant calculations beginning with the period ending December 31, 2024. The amendment also resulted in a decrease in the total capacity from $900.0 million to $775.0 million.
Previous wording
Subsequent to March 31, 2025, the Company tendered for the full repayment of its Series B, Series C and Series D notes with a prepayment date of May 9, 2025. The repayment was financed with additional borrowings on the unsecured revolving credit facility.
Current wording
During the six months ended June 30, 2025, the Company fully repaid its Series B, Series C and Series D notes.
Previous wording
Net loss increased $26.9 million, or 50.5%, to $80.3 million for the three months ended March 31, 2025 compared to $53.4 million for the three months ended March 31, 2024. The reasons for the change are discussed below with respect to the decrease in net operating income for the same period.
Current wording
Net loss increased $40.2 million, or 84.5%, to $87.8 million for the three months ended June 30, 2025 compared to $47.6 million for the three months ended June 30, 2024. The reasons for the change are discussed below with respect to the decrease in net operating income for the same period.
Previous wording
NOI decreased $18.8 million, or 18.0%, for the three months ended March 31, 2025 as compared to the three months ended March 31, 2024, primarily resulting from:
Current wording
NOI decreased $22.8 million, or 21.8%, for the three months ended June 30, 2025 as compared to the three months ended June 30, 2024, primarily resulting from:
Previous wording
•a $7.9 million decrease in same-store NOI driven by
Current wording
•a $15.0 million decrease in same-store NOI driven by:
Previous wording
•a $5.0 million decrease in total office revenues mainly driven by lease expirations at our Met Park North, Concourse and 901 Market properties in 2024; and
Current wording
•a $14.5 million decrease in rental revenues driven by lease terminations at our 1455 Market, Concourse and Met Park North properties; partially offset by
Previous wording
•a $10.8 million decrease in non-same-store NOI driven by:
Current wording
•a $7.8 million decrease in non-same-store NOI driven by:
Previous wording
•a $3.4 million decrease in total studio revenues due to lower stage and production activity at Quixote during the three months ended March 31, 2025 as compared to the prior period; and
Current wording
•a $3.1 million decrease in total studio revenues due to lower stage and production activity at Quixote; and
Previous wording
We recorded a $1.3 million loss from unconsolidated real estate entities for the three months ended March 31, 2025 compared to a loss of $0.7 million for the three months ended March 31, 2024. The change was primarily driven by mark-to-market adjustments for an interest rate swap that does not qualify for hedge accounting.
Current wording
We recorded a $0.2 million loss from unconsolidated real estate entities for the three months ended June 30, 2025 compared to a loss of $2.5 million for the three months ended June 30, 2024. The change was primarily driven by mark-to-market adjustments for an interest rate swap that does not qualify for hedge accounting.
Previous wording
We recognized fee income of $1.4 million for the three months ended March 31, 2025 compared to $1.1 million for the three months ended March 31, 2024. Fee income represents the management fee income earned from our unconsolidated real estate entities. The increase in fee income is primarily driven by an increase in construction activity at the Sunset Pier 94 Studios development during the three months ended March 31, 2025.
Current wording
There was no significant change in fee income. We recognized fee income of $1.5 million for the three months ended June 30, 2025 compared to $1.4 million for the three months ended June 30, 2024. Fee income represents the management fee income earned from our unconsolidated real estate entities.
Previous wording
Gross interest expense decreased by $1.5 million or 3.0%, to $49.1 million for the three months ended March 31, 2025 compared to $50.7 million for the three months ended March 31, 2024. The decrease was driven by lower reference rates on our floating rate debt during the three months ended March 31, 2025 as compared to the three months ended March 31, 2024.
Current wording
Gross interest expense remained relatively flat, at $53.1 million for the three months ended June 30, 2025 compared to $53.1 million for the three months ended June 30, 2024. The slight increase during the three months ended June 30, 2025 was primarily related to the interest expense related to the Office Portfolio CMBS loan, which was secured during the first quarter of 2025. The increase was offset by repayment of the Series B, C and D notes during the three months ended June 30, 2025, as well as lower reference rates on our floating rate debt.
Previous wording
We recognized an unrealized loss on non-real estate investments of $0.4 million for the three months ended March 31, 2025 compared to an unrealized loss of $0.9 million for the three months ended March 31, 2024, which were due to the observable changes in the fair value of the investments.
Current wording
We recognized an unrealized gain on non-real estate investments of $0.2 million for the three months ended June 30, 2025 compared to an unrealized loss of $1.0 million for the three months ended June 30, 2024, which were due to the observable changes in the fair value of the investments.
Previous wording
•a decrease in studio NOI of $1.7 million primarily due to lower production activity at Sunset Gower Studios, partially offset by higher production activity at Sunset Las Palmas Studios during the three months ended March 31, 2025 as compared to the prior period.
Current wording
•a decrease in studio NOI of $4.4 million primarily due to lower production activity at Sunset Gower Studios, partially offset by higher production activity at Sunset Las Palmas Studios.
Previous wording
•a decrease in office NOI of $3.0 million primarily resulting from 2024 lease terminations at our 625 Second property and the sales of our 3176 Porter property in 2024 and Foothill Research and Maxwell properties in 2025.
Current wording
•a decrease in office NOI of $7.8 million resulting from the sales of our 3176 Porter property in 2024 and our Foothill Research, 625 Second and Maxwell properties in 2025.
Previous wording
During the three months ended March 31, 2025, we recognized a net gain on sale of $10.0 million attributable to the sales of our Foothill Research and Maxwell properties. No gain or loss on sale was recognized during the three months ended March 31, 2024.
Current wording
During the six months ended June 30, 2025, we recognized a net gain of $10.0 million primarily attributable to the sales of our Foothill Research and Maxwell properties. No gain or loss on sale was recognized during the six months ended June 30, 2024.
Previous wording
During the three months ended March 31, 2025, we recorded an impairment loss of $18.5 million due to a reduction in the estimated holding period for our 625 Second property. We did not record any impairment charges during the three months ended March 31, 2024.
Current wording
During the six months ended June 30, 2025, we recorded an impairment loss of $18.5 million due to a reduction in the estimated holding period for our 625 Second office property. We did not record any impairment charges during the six months ended June 30, 2024.
Previous wording
During the three months ended March 31, 2025, we recognized a loss on extinguishment of debt of $1.9 million related to the early repayment of the loan secured by our Element LA property. No gain or loss on extinguishment of debt was recognized during the three months ended March 31, 2024.
Current wording
During the six months ended June 30, 2025, we recognized a $3.5 million loss on extinguishment of debt related to the early repayment of the loan secured by our Element LA property and the Series B, C and D notes. No gain or loss on extinguishment of debt was recognized during the six months ended June 30, 2024.
Previous wording
•proceeds from the Sunset Pier 94 Studios construction loan (unconsolidated joint venture) and Bentall Centre loan (unconsolidated joint venture); and
Current wording
•proceeds from the Sunset Pier 94 Studios construction loan (unconsolidated joint venture); and
Previous wording
We had approximately $86.5 million of cash and cash equivalents at March 31, 2025. Our principal source of operating cash flow is related to leasing and operating the properties in our portfolio. Our properties provide a relatively consistent stream of cash flow that provides us with resources to pay operating expenses, debt service and fund quarterly dividend and distribution requirements.
Current wording
We had approximately $236.0 million of cash and cash equivalents at June 30, 2025. Our principal source of operating cash flow is related to leasing and operating the properties in our portfolio. Our properties provide a relatively consistent stream of cash flow that provides us with resources to pay operating expenses, debt service and fund quarterly dividend and distribution requirements.
Previous wording
Our ability to incur additional debt will be dependent on a number of factors, including our degree of leverage, the value of our unencumbered assets and borrowing restrictions that may be imposed by lenders. If we incur additional debt, the risks associated with our leverage, including our ability to service our debt, would increase. In addition, our ability to incur additional debt may be affected by our senior unsecured debt ratings as provided by the major credit rating agencies in the United States. Certain of the major U.S. credit rating agencies have previously downgraded our senior unsecured debt rating to non-investment grade. These and any further ratings downgrades could adversely impact our ability to access debt markets in the future and increase the cost of future debt. As of March 31, 2025, the credit ratings for our senior unsecured debt were B2, BB- and BB- from Moody’s, Standard and Poor’s and Fitch, respectively.
Current wording
Our ability to incur additional debt will be dependent on a number of factors, including our degree of leverage, the value of our unencumbered assets and borrowing restrictions that may be imposed by lenders. If we incur additional debt, the risks associated with our leverage, including our ability to service our debt, would increase. In addition, our ability to incur additional debt may be affected by our senior unsecured debt ratings as provided by the major credit rating agencies in the United States. Certain of the major U.S. credit rating agencies have previously downgraded our senior unsecured debt rating to non-investment grade. These and any further ratings downgrades could adversely impact our ability to access debt markets in the future and increase the cost of future debt. As of June 30, 2025, the credit ratings for our senior unsecured debt were B2, B and B+ from Moody’s, Standard and Poor’s and Fitch, respectively.
Previous wording
We are in the process of refinancing the $314.3 million loan secured by our 1918 Eighth property, which matures in December 2025. There can be no assurance as to whether the refinancing will be completed.
Current wording
We are in the process of refinancing the $314.3 million loan secured by our 1918 Eighth property, which matures in December 2025. There can be no assurance as to whether the refinancing will be completed. Additionally, we have received commitments from six participating banks to extend $462 million of revolving credit commitments through December 31, 2029, including two 6-month extension options, and to increase by $20 million the revolving credit commitments under the current revolving credit facility through December 31, 2026 (including two 6-month extension options), in each case, subject to the satisfaction of certain conditions.There can be no assurance that the extension or increase will be completed.
Previous wording
Equity capitalization represents the shares of common stock outstanding (including unvested restricted shares), OP and LTIP units outstanding, restricted performance units and dilutive shares multiplied by the closing price of $2.95, as reported by the NYSE, on March 31, 2025, as well as the aggregate value of the Series C preferred stock liquidation preference as of March 31, 2025.
Current wording
Equity capitalization represents the shares of common stock outstanding (including unvested restricted shares), pre-funded warrants, OP and LTIP units outstanding, restricted performance units and dilutive shares multiplied by the closing price of $2.74, as reported by the NYSE, on June 30, 2025, as well as the aggregate value of the Series C preferred stock liquidation preference as of June 30, 2025.
Previous wording
During the three months ended March 31, 2025, there were no material changes outside the ordinary course of business in the information regarding specified contractual obligations contained in our 2024 Annual Report on Form 10-K. Refer to Part I, Item 1 “Note 9 to the Consolidated Financial Statements—Debt” for information regarding our future minimum principal payments due on our outstanding debt. Refer to Part I, Item 1 “Note 12 to the Consolidated Financial Statements—Future Minimum Rents and Lease Payments” for information regarding our future minimum operating lease payments. Refer to Part I, Item 1 “Note 20 to the Consolidated Financial Statements—Commitments and Contingencies” for more detail.
Current wording
During the six months ended June 30, 2025, there were no material changes outside the ordinary course of business in the information regarding specified contractual obligations contained in our 2024 Annual Report on Form 10-K. Refer to Part I, Item 1 “Note 9 to the Consolidated Financial Statements—Debt” for information regarding our future minimum principal payments due on our outstanding debt. Refer to Part I, Item 1 “Note 12 to the Consolidated Financial Statements—Future Minimum Rents and Lease Payments” for information regarding our future minimum operating lease payments. Refer to Part I, Item 1 “Note 20 to the Consolidated Financial Statements—Commitments and Contingencies” for more detail.
Previous wording
Comparison of the cash flow activity for the three months ended March 31, 2024 is as follows (in thousands, except percentage change):
Current wording
Comparison of the cash flow activity for the six months ended June 30, 2025 to the six months ended June 30, 2024 is as follows (in thousands, except percentage change):
Previous wording
Cash and cash equivalents and restricted cash were $133.9 million and $99.2 million at March 31, 2025 and December 31, 2024, respectively.
Current wording
Cash and cash equivalents and restricted cash were $267.1 million and $99.2 million at June 30, 2025 and December 31, 2024, respectively.
Previous wording
Net cash provided by operating activities decreased by $34.6 million, or 53.1%, to $30.5 million for the three months ended March 31, 2025 compared to $65.1 million for the three months ended March 31, 2024. The decrease primarily resulted from the dispositions of Foothill Research and Maxwell in the first quarter of 2025 and 3176 Porter in the fourth quarter of 2024, significant tenant move-outs in 2024, lower production activity at Quixote in 2025 and lease termination fees paid in 2025 to exit several operating leases at Quixote.
Current wording
Net cash provided by operating activities decreased by $72.3 million, or 71.7%, to $28.5 million for the six months ended June 30, 2025 compared to $100.8 million for the six months ended June 30, 2024. The decrease primarily resulted from the dispositions of our Foothill Research, Maxwell and 625 Second properties in 2025 and our 3176 Porter property in the fourth quarter of 2024, lease terminations at our 1455 Market, Concourse and 901 Market properties, lower production activity at Quixote and one-time lease termination fees paid to exit several operating leases at Quixote.
Previous wording
Net cash provided by investing activities for the three months ended March 31, 2025 was $15.9 million compared to $71.4 million of net cash used in investing activities for the three months ended March 31, 2024. The change primarily resulted from $63.2 million of proceeds from sales of real estate during the three months ended March 31, 2025. There were no sales of real estate during the three months ended March 31, 2024. The change was additionally driven by a $16.4 million decrease in contributions to unconsolidated entities and a $7.7 million decrease in additions to investment in real estate during the three months ended March 31, 2025 as compared to the three months ended March 31, 2024.
Current wording
Net cash used in investing activities decreased by $113.0 million, or 93.3%, to $8.1 million for the six months ended June 30, 2025 compared to $121.0 million for the six months ended June 30, 2024. The decrease primarily resulted from $88.3 million of proceeds from sales of real estate, a $21.2 million decrease in contributions to unconsolidated entities and a $12.6 million decrease in additions to investment in real estate during the six months ended June 30, 2025. The decrease was partially offset by the $8.8 million effect of consolidating a previously unconsolidated entity during the six months ended June 30, 2024.
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Rearranged current paragraphs (19)
Current report — wording carried from elsewhere
•a decrease in studio NOI of $2.7 million primarily due to lower production activity at Sunset Gower Studios.
Current report — wording carried from elsewhere
Loss on sale of real estate, net
Current report — wording carried from elsewhere
During the three months ended June 30, 2025, we recognized a loss on extinguishment of debt of $1.6 million related to the early repayment of the Series B, C and D notes. No gain or loss on extinguishment of debt was recognized during the three months ended June 30, 2024.
Current report — wording carried from elsewhere
Net loss increased $67.1 million, or 66.5%, to $168.0 million for the six months ended June 30, 2025 compared to $100.9 million for the six months ended June 30, 2024. The reasons for the change are discussed below with respect to the decrease in net operating income for the same period.
Current report — wording carried from elsewhere
Management further analyzes NOI by evaluating the performance from the following groups:
Current report — wording carried from elsewhere
•Same-store, which includes all of the properties owned and included in our stabilized portfolio as of January 1, 2024 and still owned and included in the stabilized portfolio as of June 30, 2025; and
Current report — wording carried from elsewhere
•Operating results from studio service-related businesses
Current report — wording carried from elsewhere
The following table reconciles net loss to NOI:
Current report — wording carried from elsewhere
The following table summarizes certain statistics of our same-store office and studio properties:
Current report — wording carried from elsewhere
Percent occupied for same-store studio is the average percent occupied for the 12 months ended.
Current report — wording carried from elsewhere
The following table gives further detail on our NOI:
Current report — wording carried from elsewhere
The following table gives further detail on our change in NOI:
Current report — wording carried from elsewhere
•a $22.2 million decrease in same-store NOI driven by:
Current report — wording carried from elsewhere
•a $19.4 million decrease in non-same-store NOI driven by:
Current report — wording carried from elsewhere
Loss from unconsolidated real estate entities
Current report — wording carried from elsewhere
We recorded a $1.5 million loss from unconsolidated real estate entities for the six months ended June 30, 2025 compared to a loss of $3.2 million for the six months ended June 30, 2024. The change was primarily driven by mark-to-market adjustments for an interest rate swap that does not qualify for hedge accounting.
Current report — wording carried from elsewhere
There was no significant change in fee income. We recognized fee income of $2.8 million for the six months ended June 30, 2025 compared to $2.5 million for the six months ended June 30, 2024. Fee income represents the management fee income earned from our unconsolidated real estate entities.
Current report — wording carried from elsewhere
The following table presents a reconciliation from gross interest expense to the interest expense line item on the Consolidated Statements of Operations:
Current report — wording carried from elsewhere
We recognized an unrealized loss on our non-real estate investments of $0.2 million for the six months ended June 30, 2025 compared to a loss of $1.9 million for the six months ended June 30, 2024, which were due to the observable changes in the fair value of the investments.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
•a decrease in studio NOI of $7.8 million driven by