Earnings

Hudson Pacific Raises 2026 Core FFO Outlook After Occupancy Gain

The Tip Desk · November 11, 2026 · 4 min read

The REIT lifted its full-year Core FFO range to $1.15 to $1.21 a share after in-service office occupancy reached 85.6%.

Hudson Pacific Properties, Inc. (HPP) raised and narrowed its full-year 2026 Core FFO outlook to $1.15 to $1.21 a share from $1.12 to $1.20 after in-service office occupancy rose for a fifth consecutive quarter.

The West Coast office and studio REIT said the new range reflects current and future market conditions, including assumptions on rental rates, occupancy and the earnings impact of recent events. It now assumes average in-service office occupancy of 82.0% to 84.0% and same-store cash NOI growth of 0.00% to 1.00% for the full year. The company said the 200 basis point occupancy improvement and 175 basis point same-store cash NOI improvement are essentially attributable to the sales of 875 Howard and Skyport Plaza and the temporary removal of Fourth & Traction from the in-service and same-store portfolios for seismic upgrades. Absent those changes, it said it likely would have maintained its prior outlook for both metrics.

In-service office occupancy reached 85.6%, up 310 basis points sequentially, after a 470 basis point sequential gain to 82.5% in the second quarter. The leased rate rose to 86.1%. Excluding asset sales and the Fourth & Traction removal, occupancy and leased rate increased 80 and 100 basis points sequentially.

Office leasing slowed from the second quarter’s 1.3 million square feet, which included 891,000 square feet with the City and County of San Francisco. Hudson Pacific executed 74 leases totaling 533,708 square feet, 49% new and 51% renewal. GAAP rents on new and renewal leases rose 6.0% versus prior leases for the same space, and cash rents rose 0.4%. A 65,000-square-foot renewal and expansion with Rivian and Volkswagen Group Technologies at Clocktower Square in Palo Alto runs through 2033.

Core FFO was $18.6 million, or $0.28 a share, up about 8% from $0.26 a year earlier. The company attributed the per-share increase primarily to improved same-store NOI and lower non-real estate depreciation after exiting non-core Quixote operations, partially offset by asset sales. Same-store cash NOI was $85.2 million, up 8.3% from $78.7 million a year earlier, which the company said was driven by improved office occupancy and studio production activity.

Total revenue was $180.9 million, compared with $186.6 million a year earlier, primarily due to asset dispositions, partially offset by improved office occupancy and studio production. General and administrative expenses were $12.3 million.

The company reported a net loss of $218.1 million, or $3.38 a share, compared with a $136.5 million loss, or $2.12 a share, a year earlier, primarily due to non-cash impairments and a loss on the sale of office properties, partially offset by a prior-year deconsolidation loss. Impairment loss was $147.8 million and the loss on sale of real estate was $20.3 million.

AFFO was $(5.1) million, or $(0.08) a share, compared with $12.3 million, or $0.19 a share, a year earlier, primarily reflecting higher capital expenditures associated with lease-up activity.

Hollywood studio stages remained 95.0% leased. Sunset Pier 94 Studios reached 82.2% leased, up 370 basis points sequentially. Trailing three-month in-service studio leasing was 74.7%, stable versus the prior quarter.

Hudson Pacific sold 2001 Gateway in North San Jose and 875 and 899 Howard in San Francisco for an aggregate $90.5 million. Subsequent to the quarter it sold Skyport Plaza for $75.5 million and repurchased $200.0 million of senior notes due 2027 and 2028 at a discount. Pro forma for those sales, a non-core Quixote asset sale and the notes repurchase, HPP’s share of debt is $2.7 billion, down $425.0 million, or 14%, from a year ago, with $840.4 million of liquidity. Liquidity at September 30 was $955.8 million. Net debt to undepreciated book value was 32.1%, with 100% of debt fixed or capped at a weighted average rate of 4.9%.

Weil, Gotshal & Manges’ 38,000-square-foot lease expired after quarter-end, dropping the firm to 0.9% of annualized base rent and 14th among the 15 largest office tenants. The company said it has received no indication the firm will stop paying rent but conservatively excluded that rent from the 2026 outlook. Coleman said the leasing pipeline remains above 2 million square feet, with more than 1 million square feet in advanced stages.

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