HPP

Hudson Pacific Properties is a West Coast office and studio REIT in clear financial distress. The fundamentals are deteriorating across the board: FY2025 revenue fell 1.3% to $831M (down from $1.03B in FY2022) and the net loss widened to -$592M — the fourth consecutive annual loss and the largest in the series ($29M profit in FY2021 has given way to escalating losses). The in-service office portfolio was only 77.0% leased at year-end, reflecting the secular work-from-home headwind crushing office demand, and studio properties averaged 78.8% leased.

The company is in survival/deleveraging mode. It cut its common dividend to a token $351K (down 97.7%), sold four properties (Maxwell, Foothill Research Center, 625 Second and Element LA for $46.0M, $23.0M, $28.0M and $150.0M respectively) to raise cash, repaid $320.0M on its revolver, and refinanced into expensive debt — a new $475.0M Office Portfolio CMBS loan at SOFR + 4.15%. The 61.6% drop in shares outstanding points to a reverse split. Operating cash flow fell 26.5% to $121M, thin against $375M of depreciation and a heavy debt load.