Howard Hughes Holdings Inc.

OVERVIEW

Description of Business

Our award-winning assets include one of the nation's largest portfolios of MPCs, spanning approximately 101,000 gross acres, as well as operating properties, strategic developments, and other assets across five states. We create some of the most sought-after communities in the country by curating an environment tailored to meet the needs of our residents and tenants. Our unique business model allows us to seek attractive risk-adjusted returns while maintaining a sharp focus on sustainability to ensure our communities are equipped with the resources to last several decades.

We operate through three business segments: Operating Assets, MPCs, and Strategic Developments. We create a continuous value-creation cycle through operational and financial synergies associated with our three business segments. In our MPC segment, we plan, develop, and manage small cities and large-scale, mixed-use communities, in markets with strong long-term growth fundamentals. This business focuses on the horizontal development of residential land. The improved acreage is then sold to homebuilders who build and sell homes to new residents. New homeowners create demand for commercial developments, such as retail, office, and hospitality offerings. We build these commercial properties through Strategic Developments at the appropriate times, which helps mitigate development risk, using the cash flow harvested from the sale of land to homebuilders. Once the commercial developments are completed, the assets transition to Operating Assets, which increases recurring Net Operating Income (NOI), further funding our Strategic Developments. New office, retail, and other commercial amenities make our MPC residential land more appealing to buyers and increase the velocity of land sales at premiums that typically exceed the broader market. This increased demand for residential land generates more cash flow from MPCs, thus continuing the value-creation cycle.

On May 5, 2025, the Company sold 9,000,000 newly issued shares of the Company’s common stock to Pershing Square for an aggregate purchase price of $900 million. This represented a significant milestone for the Company, and we continue to evaluate opportunities to deploy this capital. Over time, we expect HHH will be transformed into a premier diversified holding company, with our portfolio of master planned communities at its foundation. Refer to Note 2 -Pershing Square Transaction in the Notes to Condensed Consolidated Financial Statements under Item 1 of this Quarterly Report for additional information on the transactions with Pershing Square.

In addition to the required presentations using GAAP, we use certain non-GAAP performance measures, such as NOI and MPC Net Contribution. See the Operating Assets and MPC sections below for the reconciliations of these GAAP to non-GAAP financial measures and statements indicating why management believes these non-GAAP financial measures provide useful information for investors.

Changes for monetary amounts between periods presented are calculated based on the amounts in thousands of dollars stated in our consolidated financial statements, and then rounded to the nearest million. Therefore, certain changes may not recalculate based on the amounts rounded to the nearest million.

Second Quarter 2025 Highlights

Comparison of the three months ended June 30, 2025, to the three months ended June 30, 2024

Total Company

–Net income from continuing operations decreased to a net loss of $12.1 million in the current quarter, compared to net income of $47.4 million in the prior-year period. This decrease was primarily driven by a loss on the sale of MUD receivables.

–We continue to maintain a strong liquidity position with $1.4 billion of cash and cash equivalents, $515.0 million of undrawn capacity on our Secured Bridgeland Notes, $880.5 million of undrawn lender commitments available to be drawn for property development, subject to certain restrictions, and limited near-term debt maturities, all as of June 30, 2025.

Operating Assets

–Operating Assets NOI totaled $66.9 million in the current quarter, a $3.5 million increase compared to $63.3 million in the prior-year period.

–Multifamily NOI increased $2.7 million primarily due to continued lease-up at Tanager Echo in Summerlin, Marlow in Merriweather District, and Wingspan in Bridgeland.

–Office NOI increased $1.9 million primarily due to strong leasing activity and abatement expirations at various properties in The Woodlands, Merriweather District, and Summerlin, most notably at 9950 Woodloch Forest, 6100 Merriweather, and 1700 Pavilion, partially offset by decreases related to lower occupancy at certain properties in Merriweather District and The Woodlands, most notably at Merriweather Row and 3831 Technology Forest.

–Retail NOI decreased $1.1 million primarily due to the collection of previously reserved accounts receivable in Ward Village in 2024.

MPC

–MPC EBT totaled $102.4 million in the current quarter, a $20.8 million decrease compared to $123.2 million in the prior-year period.

–The decrease in EBT was primarily due to the timing of residential land sales, net of costs across our MPCs.

Strategic Developments

–Strategic Developments EBT increased $3.9 million to income of $1.0 million in the current quarter, compared to a loss of $3.0 million in the prior-year period.

–The increase in EBT was primarily attributable to lower depreciation expense and the recognition of a gain on the sale of a land parcel in the Merriweather District in the current period.

–We contracted 15 units at The Launiu during the current quarter and as of June 30, 2025, this development project was 66.8% pre-sold. Construction is expected to commence on The Launiu later in 2025.

–During June 2025, we launched pre-sales for our two new Ward Village condominiums, Melia and ‘Ilima. Pre-sales activity for these towers has been strong, however as of June 30, 2025, all pre-sold units were still within the contractual 30-day rescission period.

–Completed construction on the redevelopment of Grogan’s Mill Retail in The Woodlands. As of June 30, 2025, this 31,000-square-foot retail center was 55% leased.