Howard Hughes Holdings Inc Q4 2024 Earnings Call Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: Alexander Goldfarb - Piper Sandler - Analyst : Good morning down there. Hey, just a few questions and first, congrats on the expanded entitlements in Hawaii. That's something that you guys have been talking about and, for some time certainly we've been advocating just given your success out there. So nice job there. So a few questions, David first, no problem, first on cash flow and certainly appreciate the increased color. Maybe I'll just start with Seaport. Can you just give an update because Seaport has cost you guys a tremendous amount of money, for, well over a decade. It's also been a cash drain, and 2025 will be the first year that you are not impacted by any of that. So could you just provide some aggregate perspective on how much that project cost? How much that was a drain on cash flow over the past few years? And how much of a benefit not having that in the in the company as people think about your new operating cash flow metric, how the impact of that? Because I would have to think it's substantial. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 27, 2025 / 3:00PM, HHH.N - Q4 2024 Howard Hughes Holdings Inc Earnings Call

Question: Alexander Goldfarb - Piper Sandler - Analyst : Okay, the next question is Carlos you gave guidance for the operating for cash flow, which is down from last year, and yet you're still expected to end, net cash position roughly unchanged. So is that really just a reflection of not having the seaport drain? Or are there other things that you guys have adjusted in your cash flow retention that have improved the efficiency despite, not having the profit, having a different mix on condo deliveries this year.

Question: Alexander Goldfarb - Piper Sandler - Analyst : Okay, and just maybe a final one for Summerlin. The increased gross asset value slide update was very helpful, pretty impressive how much it's changed from November. But Summerlin stands out in just a dramatic acceleration in price per acre and I'm just curious how much of this is driven by, let's say, discovery versus The normal sort of that $600,000 to $700,000 type home that you guys have there. I'm just trying to understand what the real driver is on a mixed basis because it definitely stands out for how much that community has increased on a price per acre.

Question: Alexander Goldfarb - Piper Sandler - Analyst : Thank you David.

Question: Anthony Paolone - JPMorgan - Analyst : Thank you. Good morning. I guess just going back to the cash flow discussion, if we look at the $350 million at the midpoint of your guidance and think of that as a source of cash, can you maybe zoom out for a minute and just give us the bigger picture on sources and uses, but the source from the operations as well as maybe any financing and then just planned uses?

Question: Anthony Paolone - JPMorgan - Analyst : Okay, maybe if I ask it a bit differently, like if we think about you have West Phoenix and you still have a lot to do with your other MPCs, putting aside the condos in Hawaii because those, tend to get funded almost themselves it seems like what should we think of as just a recurring out of pocket horizontal development spend, over the next several years?

Question: Anthony Paolone - JPMorgan - Analyst : Okay, thanks for that. And then just my follow up here. Can you give us some updates on the expected legislation in Nevada for studios and just kind of what's happening there? I think the anticipation was maybe we'd see some things start to move here early in the year.

Question: Anthony Paolone - JPMorgan - Analyst : Okay, great. Well, good luck. Thank you.

Question: John Kim - BMO Capital Markets - Analyst : Thank you, and good morning. I appreciate the sensitivity around the Pershing Square proposal, but I was wondering if you could provide any sense at all as far as timing of when there will be an update, and I just wanted to confirm the transaction needs, Board approval and that shareholder approval to move forward.

Question: John Kim - BMO Capital Markets - Analyst : Can you name who's on that committee?

Question: John Kim - BMO Capital Markets - Analyst : Okay, can you comment on going-to operations, the Columbia, move out, any commentary on the kind of turnover and what you, expect in 2025, and how many of the move outs, whether it's an office or multi-family is potentially related to doge?

Question: John Kim - BMO Capital Markets - Analyst : And then on your guidance for this year, what's currently assumed as far as super pad sales and any commentary that you can provide on acreage sold and price per breaker that you expect?

Question: John Kim - BMO Capital Markets - Analyst : Thank you.

Question: Alexander Goldfarb - Piper Sandler - Analyst : Hey, thank you. And David, congrats on the Warner Brothers, announcement. Good luck today in the legislature. Question on the home builders and the outlook for even bigger or more land sales on a dollar value this year versus last. Can you just comment on what's going on with the home builders as far as their incentives to residents, newspapers or, the internet filled with stories about still challenged, home price market affordability and all this stuff, and yet you guys seem to by that. So just curious if the buy downs or free upgrades that the home builders are doing, if that's changed at all or if there are other things that are going on and then also if you've noticed any change in sort of the resident profile that's allowing you guys to sell or guide towards even stronger land sales this year to the builders versus last?

Question: Alexander Goldfarb - Piper Sandler - Analyst : Thank you.

Question: Craig Biff - Jasper Funds - Analyst : Hi guys, congratulations on another outstanding quarter a year. I promise this is a capital allocation question. So for closing funds, land trusts, real estate companies, the tried and true method for reducing a discount that may be is to buy back stock. Has the Section 203 waiver given to Pershing prevented the Board from buying back a material number of shares, given that they're already bumping up on the 40% cap?

Question: Craig Biff - Jasper Funds - Analyst : Okay, what would happen if you push, if your buyback, if they buyback Pershing over 40%.

Question: Craig Biff - Jasper Funds - Analyst : Okay. And when you're doing your cost of capital calculation, how do you adjust for the 40% discount -- equity discount at MAV?

Question: Craig Biff - Jasper Funds - Analyst : And you're comparing those expected returns to the return of the shareholders from buying back stock at a discount in AB?

Question: Craig Biff - Jasper Funds - Analyst : Okay, great. Good luck today.