Hudson Pacific considers $250M stock buyback

Move would be a way to increase the firm’s public valuation

Los Angeles /
Nov.November 01, 2018 03:30 PM
Victor Coleman, Epic and Icon buildings

Hudson Pacific Properties could buy back as much as $250 million worth of its outstanding stock as early as next week.

In an earnings call Thursday, Victor Coleman, HPP Chairman and CEO, said the firm had already received board approval for the repurchase.

A stock buyback on the open market would drive up the company’s stock price, which is currently trading at about $30 per share.

Coleman said HPP is “keenly aware of a disconnect between private and public valuations.” The firm is currently trading at a 30 percent discount, “much wider than its peer set,” an analyst from Citigroup noted.

“From a valuation standpoint, we are hurting dramatically in the public markets,” Coleman said. “That does not go unnoticed in this company or private investors. We performed poorly this year, and we’re not happy about it.”

The company has a market cap of roughly $4.7 billion.

Otherwise, the firm had a strong quarter overall. While revenue decreased to $180.7 million, a 4.9 percent drop from the same time last year, net income rose 57 percent to $17.4 million, from $11.1 million.

HPP closed 1.2 million square feet of office leases, a quarterly record for the company. It also sold the remaining properties of the San Mateo Office Park for $210 million.

In Los Angeles, the firm’s headquarters, the company closed its largest and third-largest leases this quarter. Netflix inked the largest deal, leasing all 302,000 square feet of commercial space at the Epic building until 2031. Hudson also signed Honey to its Fourth & Traction redevelopment in the Arts District, reflecting the third largest deal this quarter.

On the Westside, Hudson said it is making progress on securing entitlements for the redevelopment of the Westside Pavilion, a project slated to bring 500,000 square feet of new office space. The firm also said it has received interest from several tenants considering full or partial uses.

Hudson also completed its acquisition of the ground lease of the historic Ferry Building in San Francisco this quarter, adding a fully leased property to its portfolio. Hudson took a 55 percent stake in the deal, while Germany-based Allianz claimed the remaining 45 percent stake.


Related Articles

arrow_forward_ios
(iStock)
LA County sued over commercial eviction moratorium
LA County sued over commercial eviction moratorium
The future of San Francisco’s Oceanwide Center is up in the air again (Getty, Foster and Partners)
Contractors pull out as Oceanwide Center sale falls through again
Contractors pull out as Oceanwide Center sale falls through again
3800 W Alameda Avenue and 2300 W Empire Avenue, both in Burbank. (LPC West, The Burbank Portfolio)
Here are LA’s biggest office leases of 2020
Here are LA’s biggest office leases of 2020
Matt Khourie and David Gilbert (The Center at Needham Ranch)
LA North Studios signs big lease in Santa Clarita
LA North Studios signs big lease in Santa Clarita
Granite CEO Michael Dardick and Industrious CEO Jamie Hodari
Industrious partners with landlords to offer tenants satellite workplaces
Industrious partners with landlords to offer tenants satellite workplaces
Colorado Campus at 2041-2115 Colorado Avenue and Northwestern Mutual CEO John E. Schlifske
Northwestern Mutual picks up Santa Monica office campus for $166M
Northwestern Mutual picks up Santa Monica office campus for $166M
Victor Coleman and a rendering of the project (Credit: Gensler via Urbanize)
Hudson Pacific wins key approval for 500K sf Hollywood studio expansion
Hudson Pacific wins key approval for 500K sf Hollywood studio expansion
Hudson Pacific Properties CEO Victor Coleman and Sunset Las Palmas Studios (Google Maps, iStock)
Hudson Pacific studio revenue takes hit
Hudson Pacific studio revenue takes hit
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...