Howard Hughes (HHC) Presentation at REIT Week This just concluded…..
Howard Hughes (HHC) Presentation at REIT Week REIT Week Presentation
Howard Hughes Notable points (was Q&A format):
- Houston
- is well prepared for current oil price drop
- No spec construction out there……
- No material fallout in land sales
- Builders still buying lots
- Pricing remains firm
- Job losses have been primarily in oil fields
- Houston port is now 2nd largest port in US
- Still expect to see job gains in 2015
- Summerlin
- lot prices still increasing
- retailers still ahead of plan in Downtown Summerlin
- “we have best master planned communities in areas we operate”
- Hawaii
- buyers have moved into One AlMoana
- 5 more towers now have approvals
- looking at 30% margins excluding land
- Capital
- $2.5B under construction…..cash needed for them $340M
- $200M FCF from MPC’s alone in 2014
- no need to raise any additional capital unless for acquisitions
- “looking at a dozen deals a week” …like to add on to existing projects (ie: Conroe)
- Leasing at Seaport:
- in discussions with several retailers
- will not announce anything yet
- historic district open 2016
- Pier 17 open summer 2017
- NOI projections in shareholder letter exclude Seaport
- Stock Split?
- have not evaluated it yet
- Rising rates
- financing locked in on CRE projects
- mostly done with insurance co’s
- rising rates will increase cash flows of businesses
- Columbia
- have made significant headway with plans
- $9M NOI being generated from buildings obtained from GGP
- office, multi family and retail going into The Crescent, construction should start later 2015
- Change to REIT?
- right now, not the time to do that
- while it would eliminate double taxation, very high depreciation in new assets + project level interest mitigates taxes on them
- NOI’s shelter income for 12-18mos more
- when tax shields wear off “everything worth looking at” ….would then consider REIT
