Howard Hughes (HHH) 26 Jul 242024 Q2 Earnings call transcript

Good day, and welcome to Howard Hughes Holdings Second Quarter 2024 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. It is now my pleasure to introduce Senior Vice President of Investor Relations, Eric Holcomb.

Good morning from our headquarters here in the Woodlands, Texas, and welcome to Howard Hughes Holdings Second Quarter 2024 Earnings Call. With me today are David O'Reilly, Chief Executive Officer; Jay Cross, President; Carlos Olea, Chief Financial Officer; Dave Striph, President of Asset Management and Operations; and Joe Valane, General Counsel.

supplemental would you direct second can press and I website, to quarter begin, release where howardhughes.com download our we like you to our earnings Before package. both our package The earnings that be measures. directly today discussed reconciliations most non-GAAP relation their GAAP financial will to include in comparable release measures of supplemental and financial laws. forward-looking present the discuss the that statements today made or of that Certain meaning expectations are statements are tense federal the not securities in the within company's

believes expectations assurance we achieved. the such expectations statements company in the assumptions, Although be reasonable are that can forward-looking reflected will based that upon no give these

material Please see and actual between press in earnings risk forward-looking the quarter results. factors statements cause forward-looking our SEC our factors differences second and for the in statements release filings disclaimer could that

not statements to under law. duty required by any are update unless We forward-looking

the our I over will David call now O'Reilly. turn to CEO,

to Striph On to Thank our a the Dave and Good quarter in projects. will remarks quarter updates and welcome everyone, segment going Jay who planned I'm second cover the today, cover highlights call. you, morning, begin operating communities of followed the from call the Cross, our earnings Seaport. recap of Eric. with by strategic our master development on provide assets, performance for our will our

open will our we for Olea the up and before latest review sheet lines Carlos the Finally, full year balance guidance Q&A.

Howard results strong communities quarter, Hughes planned see For our outlook. exceptional solidifying our to to demand business that further our delivered the in the second and strong segments, continue we I'm report pleased core across XXXX highlighting master

record year segments. our significant communities. price puts acreage homebuilders, heightened per that meet leading residential sales increase the robust which to sales new In contributed to acre, average our guidance. we MPCs, Looking our see new path full a EBT continue from land a across well demand MPC in us land achieved to on These for quickly to around

we solid In NOI meaningful in delivered in at assets multifamily. as for operating well quarter, future to strong more growth the Village development Ward fourth performance remained XXXX. We're we Victoria see our units, track Place, condos million. in of on strategic still Woodlands quarter to which office revenue interest led now our $XXX expect Our and equates for delivery the by closed elevated levels. In year-over-year buyer XX retail condo contracted and as of sell which units in premier will

condo guidance our operating have MPC With for these year call. EBT will discuss full more in later results, asset NOI outstanding sales. we and for guidance reiterated Carlos raised our and the

the year-over-year. delivered the into Overall, the Bridgeland new sale of superpads of revenue with a residential of closed Woodlands in MPC the XX% an sold price million quarter land and record strong on sales of in average $XXX acre. quarter, Diving sale Land sales were The $XXX Hills, land EBT per a were communities increase acres XX by We million at also million XXX% sales at Land impressive Summerlin, our where segment of we XXX in second acre high led $X MPC our per results. million. a acres outstanding across underscored $X.X increase of in Texas representing year-over-year. acres or totaled XX by

of our in in land a are maintained total sales XXX home future sold homes MPCs. recent New leading of with we strong sales, believe quarters which indicator seen the a momentum

are resurgence. the X% home higher. a prior home a Although experienced X% sales down pacing Year-to-date sales modest year when from significant

home and strength forward, new sales. confident in Looking remain we rising the home inventories reduced headlines market new of despite national reporting the recent new home

construction have to reported and not metric the includes can over because homes that this months a misleading be which were risen that metric actually under completed. X inventories to recently homes home homes New have begun are nationally construction,

Looking in completed or are less at our far inventory decline since overall and than actually currently year-end months X have inventories fewer find less X market, they and of new available the Summerlin. home in completed In completed data in only the communities, suggests. been inventory, that than are you'll Bridgeland the headline month

in to With accuracy home which questioning has were recently sales, consistently respect to new found adjusted the softened, data reports. been initial the that of reported we have have reported periods, higher subsequent

strong interest, interest view and low supported increases is new applications rates. by homes in mortgage to further significant new market continue rates. results, Our remains homebuilder report incredibly cancellation Overall, rise company's homebuyer who our partners and new resilient favorable for continue home to orders high healthy the despite

expect several to for continue reasons. this We

and First foremost is affordability.

slipped time first more attractive pricing to with has than monthly new builder home decades, new incentives, resale on mortgage several rate simply the cheaper homes now in with buydowns, pricing together including home are payments attractive pricing For homebuyers.

higher New superior keeping building efficiency, are ready homes all costs important provide quality, move-in have and Availability costs less also factors. offer insurance build lower. and inventory lower require upkeep,

New nearly total homeowners X/X more their reluctant trade averages mortgages. double historic to remain homes historically as inventory, now in low represent of than

This homeowner has cuts trend mortgage the is of as not likely a average rate to less. reverse without significant X% rate or

below financial elevated have crisis. result, home highest significant surrounding new for demand undersupply new forward. remain its which demand in land our share to a to has anticipate equilibrium With strong for the of and percentage. homes a We vacant MSAs. As as well homebuilder home their existing lowest The developed level risen going communities sales lots slowed our continued since well their as market great

land to $XXX XXXX, full year. EBT for of which the we that approximately contribute record half MPC reason, For expect million second a robust strong residential sales and in will

the Turning to Seaport.

ticker of the Board will NYSE Directors American this shares every the stock. Entertainment market spin-off of HHH close expected XX. SEG receiving of for Entertainment approved the distribution HHH Entertainment and is Monday, record announced Wednesday, on July on week, Seaport common we the after to XX, X the Exchange shareholders of with coming Seaport August Seaport share X. on under trading As holders Stock of distribution stock close shares X on HHH Thursday, common begin business last our of The July at

revenues their financials, at year-over-year second associated million losses of was Entertainment in quarter. stand-up primarily loss as net result and losses $X.X to generated operating with This Tin $X.X weather, Seaport million, the million. the primarily Building, $XX of Looking loss costs of Seaport poor the reduced from incremental reflected due million NOI of a the $X.X a including total equity Seaport of a

that, the With Striph over for Dave our review of to turn a operating assets. call I'll

in prior This with reduction lease $XX including million benefit year, driven asset in the this momentum the represented part prior $X excluding from the strong a the in second unconsolidated Thank of delivery X% the year, you, ventures. by has in office segment X%. asset been the fees contribution In of NOI, year-over-year received continued NOI operating Good that up building termination quarter, David. our morning. of operating was million

Our by this strong office, NOI quarter. million performance was led $XX which reported of

office termination $X increased million, year, difficult given the increase, Excluding office a representing improvement backdrop prior those lease a in $X NOI million the of nationwide. of fees year-over-year market a XX% strong

leased build-outs expect square completed are With burn success rent quarter, the feet our we free XX% office we momentum benefit leasing our in and periods with to portfolio this During leases. now new from of off. of expanded XXX,XXX as execution the office leasing office or stabilized continued XXXX

portfolio value foot This XXX,XXX of the to achieve per considering Center II asset in office acquired and adjacent the our During adds not Woodlands space, With parking for this upon the million. the of associated a for return approximately inventory office building quarter, Plaza we much is office fully needed essentially A leased, garage. $XXX a Waterway Woodlands double-digit purchase and foot a Town square the Town land square stabilization. expected the price located Center Class $XX reflected approximately

unparalleled Woodlands, prime In creates opportunities the addition, basis covered heart acquisition future the low-cost long-term of a with land and over with exceptional in X this redevelopment. for play an acres

Bridgeland, of portfolio properties, now XX% at XX% including multifamily leased. leased, Echo Starling primarily have $XX quarter, in the Marlow newest leasing by or properties the very in year-over-year performed success with Downtown increase. during Echo the Columbia lease-up Tanager an XX% seen million revenue impressive X% our and The growth Tanager also rental last This NOI delivering Marlow Starling increased was with in at associated and Summerlin. These driven well year of

across During assets communities. the demonstrating our the markets time remain many with have stable highly the master further when our planned growth X% desirable pressure seen country, in quality multifamily rents of and our portfolio rents the strength across and

Village. increased and was we NOI leased, the NOI year retail, In $XX as at quarter, are primarily results, we growth prior multifamily million the second collection This With the Ward expect by our year pleased XX% growth of in portfolio, NOI with reserves period XXXX. year-over-year. we expect these in retail Overall, progresses. was improvement XX% driven which further full

Jay turn I'll the to that, With call our Cross. President, over

good developments, and several everyone. morning, Dave, strategic achieving another great important Thanks, milestones. quarter, we In had

First, building Nevada, we building Since under the in LOI or Columbia. square XXXXX in in XX% medical LOI and leased This in completed of completion its tenant foot steady, movie foot XXX,XXX is the or with to adjacent also XX,XXX negotiations. lease negotiations. Lakefront, has Meridian, complex project square another Downtown interest Summerlin. XX% completed in In our advanced half under office currently a studio site proposed first currently been Maryland, office we

Green, of which construction the new portfolio. foot projects mass on innovative will timber in we Houston square office XX,XXX One quarter, seen start has year In This the first in completed we high this expect area be including Bridgeland next demand. celebrated building X our entire and the project,

week, LOI. with this pre-leased As it XX% already under another of was X%

from XXXX in This construction XXXX, inventory. projects In a XX remaining on are we Kalae, in future recognized completed represent and of expected Hawaii, tower in Victoria with towers these Park presold $X.X Ward only completed Harbor impressively be and Ward scheduled presold and Kalae, collectively XX% now condo Village, be condo to in which have to late delivered. front the Hawaii, are late under X billion, be respectively. is together units are XX% in across Place, projects which we X project, Village. With commenced XXXX, meaningful is These which row XXX-unit revenue construction Kewalo as with mid-XXXX, Ulana will

units of project first XXth these had In Village, Ward million. representing Launiu, Ward The for we XX% Looking in David Since second presales total related we $XXX presales solid, as quarter. the its approximately project of majority outstanding with quarter, eclipsing has Village. of end. XX the contracted been this mentioned, XXX demand revenue unit incremental condo to future at an quarter condo condos, our by launch in sales,

contracted with the XX additional luxury condos Texas, an revenues And launch in $XXX Woodlands the finally, is Ritz-Carlton in second now XX% of project last we pre-sold This The week following Residences, sold the March, future XXX-unit successful extremely the in quarter. of million. of

We exciting expect to year. this later construction development this on start

I Olea, to would call and now the the Carlos like guidance who will hand sheet. our CFO, to our over balance review

Jay, you, condo second will XXXX EBT sales segments, be have good strong morning, incredibly momentum and experienced we an successful we and our and MPC guidance confident we we quarter, and the look to we increased remain that With everyone. Today, guidance, that continue our our core operating reiterate a and year. year. Thank for across G&A the asset

the earlier, David As and Woodland sales project residential residential segment, This Bridgeland year. record Summerlin steady significant third million half the with throughout to EBT our $XXX the lot we mentioned midpoint. sales of and superpad the robust MPC sales land in quarter guidance of at sales during in in second contemplates the continue

will increasing reduced for in of the well custom of notably first lot the and and commercial in Summerlin. success we offset of builder previously past growth Aria as land price the As cells year. are our significant sales operating residential office, be year-over-year the performance strong due sales as limited of outlook Summit Woodlands in land in XXXX, participation full highlighted, a Isle inventory to the assets Because half of in the most by our

is to X% the midpoint $X with approximately NOI off Our of midpoint approximately being guidance expected This is previous approximately the $XXX spun second $XXX range, which a up now of also Entertainment. in of to million year-over-year a XXXX year-over-year of contemplates related be with range X% which to in a the increase of Seaport half X% to removal Ballpark, of was with Las X% expected million. new million Vegas to

to $XXX margins previously expected between revenues, between million, to million were between Going million to $XXX $XXX gross XX%. XX% gross which to now $XXX and sales expected of and with are approximately range million margins XX% with range

more quarter fourth in is of will entirely guidance residences the now Our see driven expect the almost close in completion which Victoria by we Place XXXX.

approximately due Our million first guidance. quarter contemplates in XXXX $XX the compared into to to $XX approximately of million new sales million the closing of timing condo delaying to guidance previous of revenues our $XX

range for and finally, And expenses important note expect to well is continue noncash the to that as cash as $XX to complete approximately Seaport million excludes anticipated year. of of we stock $X guidance spinoff cash full million the G&A this between to It of $XX approximately million compensation. million Entertainment $XX

Turning to sheet. balance our

sheet Approximately needed $XXX equity of $XXX with approximately of $XXX was end outstanding the our will the with the million at loan construction be $X of fund $XXX position with contribution million close in further XXXX. the on this maturities in we principal the well At Together Victoria a to million. XXXX. $XXX current repaid units capital deploy of related fourth us is of in cash have expectations $X.X the full quarter, appropriately. end we and Place due amortization in strengthen leaving perspective, only We only strong as of strong guidance payments From which positioned year, a project quarter. had total remaining our million million balance our for are the debt to to June, million

maturing XXXX quality a loan approximately represented demand our maturities assets XXXX with Drive loan after today's million are of For office X-year at Forest truly challenging for the X%. This refinancing, of closing our fixed speaks of the XXXX, to particularly a we rate million nonrecourse and have approximately seeing successful the the $XXX Woodlands. the strong of in in previously market, $XXX Woodloch this XX% refinancing of and we

And with which demonstrates minimal of million further contracts bears value million create also $XXX to with with on non-recourse projects a our construction in revenue, Kalae. has condo interest SOFR loan plus cash tower finally, already maturity This closed equity. we $XXX Village loan X% for in at a our The future representing ability XXXX. Ward

now would closing I for the that, call remarks. David With like over to turn back to

Thank you, Carlos.

everyone Investor we Time for to Invitations your remind I join Q&A, conjunction Conference November up Investor in Before XX soon, up about the Summerlin open be p.m. but please X:XX with our to at will be Vegas. registration in Pacific with which next us. coming calendars on NAREIT in lines want Monday, held information will just Day, mark Las

Holcomb. out specific questions meantime, have If please the you in reach to Eric

short what residential second this for gross the we across $XXX of NOI our for closing, record year. In strong performance, be another asset profit our will sales quarter EBT, core results remarkable solidifying record foresee million condo businesses, were sales record-breaking over further expect nothing and robust outstanding and and year MPC land full With Howard from of we operating Hughes.

your to make all ahead. and journey Seaport Entertainment of And of have to spin-off in the success. thank Entertainment many the employees Seaport all our best a nearly wish I minute tirelessly completed, who worked to With you want the we spin-off take team, a the

exciting For real company of as best, our master what our in with estate do Howard history identity Hughes, acres focused nearly in world-class a portfolio. chapter we With XX,XXX communities. pure-play we land new unmasked on embarked a refined solely planned on remaining building an

We growth of us. and ahead creation opportunities have decades thoughtful for value of

With lines Operator, first can that, the the please. let's for question call. Q&A the you portion start of open

with [Operator line Alexander Instructions] First of Sandler. from the Goldfarb Piper comes question

finally spin-off here. the finally, Seaport the with David,

Just for math a few, questions I guess, you. sort of

-- $X.X contribution as of said but book think million was So we from also it's there think One, I for loss, can think the twofold. you million just $XX NOI a negative you I value, Seaport. -- about sort

all the Seaport related related G&A forward sounds Seaport the to are look to number. spin-off go that third we in embedded quarter, all it as losses basically, like the the away, obviously, to So

just thinking you going amount from just we to second the the I sheet? that's the any, is, as from going balance else your income Seaport missing that off of part to remove make So want to us that earnings that's to we're come forward new we're you is Howard make capital, and Hughes the sure parts really other And statement? of about sure anything can if guys the entity going remind Seaport not in want the

Alex. Happy walk through Absolutely, that. you to Yes.

and give want in I'm been all I color as have. living In going to the Carlos weeds I fact, of that before question to you the just to do the detail your he's more than ask this Carlos But as clarify thing one on part details. takes

effective because be is XX. Next this quarter, be right, removing July won't to we entirely, going

X effective. the XQ of X have will results is Seaport spin of inclusive we of the of before months So the

lot of And It be a is MPC little this. So as than which a be we bit pure-play there Carlos? fourth company exciting. a will reporting then the noise less will us incredibly next be will quarter. in quarter, for

you, Thank Yes. David.

you as part there anticipation So you yes, and else. autonomous segment yes, spin-off on you August in an away. goes segment been know, what the results is Seaport particularly spinoff, the our away as a some that to in the the separate run quite although, encapsulated we effective Everything what on financials go for have Seaport is the entity of see that before. segment when But nothing -- X, will whatever past the go Seaport even reporting the been time has see is will

baseball In team spin-off. is to addition the as in go we all segment, are it -- the but and the to well, the ballpark the with going know as

And about from. yes, about -- what going capital then

Yes.

the One spin-off that going to ] $XX $XX will to infusion million infusion. be Entertainment. As place us far million take a cash Seaport as at [ the completion there's time from the cash cash infusion, of

topic. a It's home David, Okay. And quite then, going to back sales. been

home the in related and press sales. to quoted been obviously You've TV on

crisis, Howard a you just nationwide. little like data, something from X-month housing look hear you we referenced And this the healthy, to because that to at it's the in Hughes which other is is all homes. if the But not bit going it's could obviously, inventory biggest shows and is general inventory. since sure your the credit remain that new talk home then it's sales and not. which point, I'm been more or a was whatever bears, just no, You that maybe

of that a see the X seeing just that number, communities ground you headline then just out that what versus your are actually guys the So some more the on on could months, and you that's overall? was numbers we bit maybe inventory parse also national or of

on Alex. Yes. a Happy deeper little that, go to

about super headlines it's I misleading an what's think backed think XXX,XXX XX Roll XXX,XXX, the gloom. first we revision that a report I really And initial that data original April ago sales But terms the important. up and a to forward were reported. just that clock that of year-over-year April incredibly about often increase. days we a the which when home June XX decline doom read to number the XX% that's become way wasn't clear. shown reported, and number If was homes, has of would wasn't happening. the saw as year-over-year the a in days. celebrated week were have numbers revised report, reported In clock because If upward we in headlines XXX,XXX, when was

closer have little make data detail to So do an pay that what's think decision. bit to underlying to I informed we a

construction, represent it that and unless sold it contracted, have new there's a contracted And that of homes sold builders are which X lots are home that been it completed consists where they do. number are spec, spec rarely sold consists as includes cancellation which of truly then building inventory. inventory, things: it not that the been consists reported, that of are on And Alex, under and gets homes predominantly

that described, X-month at of inventory, look third spec homes, that the just a the at leg just new you number. nationally, I that's the completed stool If

at at it's In our month, it's Summerlin, portfolio, half and X in month. a in Bridgeland,

not we So of headline nearly home this sitting is think completed nationally. that negative overhang spec inventory see I there, that's reported the

manageable. it's very think I

ticked And relatively created the that new rapidly higher what increase it's interest see to We I a and we cancellations that rates number books. homebuilder today. fact, completed historic an seeing much spike of to really than appropriate inventory when saw level. we're in and That think through tight the it's home flow number norms. anything compared higher number close

going Last the that units just a which units on end? to to contrast a is Okay. Ward Are a the derisk? hear until looking the just in the there. out market Or you final units selling more to to off wait chunk presales Ritz the holding in are end until you still out you And meaningful question Happy quarter, rethinking Village. way bulk you guys the Ritz end hold more rather the now and the Woodlands. than project the now sold about amount talked condos of at the of of the till towards

has have changed, the We've to Look, hasn't market in taken available here in and sales sales only Despite the even that strategy and of is the exception unrewarded, the team units handful handful. what we I the of sales still through show go finish built go off efforts remaining sometimes dramatically Woodlands at will our the and building suppose. the an and the pretty with effort few time. think The a quality that team a honestly higher we our pricing almost sold we of the we've units, listed pricing listing No, slow efforts units. gallery until increasing we've Alex. off increased in best the point prices do all the that can

hasn't that think I in Hawaii. look, So our strategy shifted

and the value is value delivering time. we over towers strategy price, a there. deliver Our the shareholders of towers the to sell not about just XXX% net speed, last is And to right but and XX squeezing present to you're because bit about dollar over different ability have

that the one, the have one sold perhaps today sold us to by immediately. approach shareholders another building, have quickly pragmatic might taking Woodlands, the as I fast our that launch excess someday, in we to them going In value building the site communities to planned tower next sellout through master tower as of on a rather on the allows best think rifle country. sell best we're and out can. deliver we and getting So that it's and than And in of but it thoughtful, the best we

the Anthony JPMorgan. with Our next of from line Paolone question comes

over us Can next to you maybe about because talk Seaport just gone. cash XX about to months the the perhaps drag XX to to think how allocation is capital be going from

condo You've lot upcoming kind are locked The performing a got up. of of sales MPCs well.

it seems even about going to even? incremental should And it think and cash. as how that just have we stock So like relates you're buying perhaps order back the pecking maybe to

to new as And potentially all a do in Ritz us studios. to -- I debate of a our it's question. just how we our Tony, passed think inflationary harder given we projects. the our construction a sitting more the the capital in opportunities shot It's terms powder on highest on Really allocate those if great costs, for that not here, drive harder. has that those on not of dry the Hawaii, but get seen per today, Nevada we're within the higher you've to that return approach something take becomes those, all and condos able some company C-suite, pressures in intrinsic every rate rental time, development law board kept to result, rifle a on day. value up with development new share Carlton basis our And growth the within focused

onto a executable raw value environment, up as approach a development we raises at we our that knocking how ago an a And higher off X% value rightful to share That environment land buybacks our commercial cost be squeezed doesn't share multifamilies take and think new more developments. And across X% opportunity when realistic right? gotten were pragmatic we return to exist to list. as the a unlock rate with our through the in result, books, have than shot those we portfolio as see the cap on and couple more opportunity become today. buybacks have a thoughtful, of years I of returns incremental And create capital

as Okay. mentioned then on And studios well. list and that you'd the was my

update the So kind a legislation think to HHH do will get the what equity to need is there moving? deal? that as should that any session then being about we holding to special also, or of potentially that sort there And of Nevada

and So the now, great is get that Nevada state in the intent legislative hopefully to February. when being that our grafted actually it studio the bill, as we in by right sits bill could senators of they into back is the of session on session one come

February between and think dynamics go I year special election in state, local And in going back with session see then. unlikely the to politics the given unlikely a a after November the frame session be the it on some election of they the would and called holidays officially so now November. is then before tight, time actually special is also

for that we're we ready we're and legislative of efforts getting and very the optimistic in that February try get to our something all and can on session towards focused, early really really we're session. putting So done hopeful

to the if to thought But even we drive about In cost but want the Hughes. project don't requirement depend $XXX million a be to remaining XX-ish you that capital studio. implies need it shared that what much loan, typical in I Sony which the of equity $XXX-ish Howard range percent and of going studio, -- construction split say on be would million terms bill between a passed because will how would that in the overall drive the will of the for amount that the of project, because that's sizing gets of entirely

then Those Okay. if helpful I can. last were And one just brackets.

much expected stronger well. You mentioned terms say, the have about strong how than in pricing pricing versus sold we been in the maybe just unit like got as MPC mix Can and that segment what real might you appreciation, price this of the was quarter just year-over-year? talk of

you decent see every continues dramatic I the in acres day XXX price Across acre other you nothing almost Summerlin. of price to growth across percent And land million about increase think remarkable. at multiple it's communities look, in Page in us of in Hills Summerlin to me and if saw get from our the as Summerlin, to short surprise see to Look, appreciation to their year-over-year supplemental, in XX residential to $XXX,XXX relates of per team with in pretty Bridgeland some and XX acre execution. $X.X XX-plus look we superpads And a acres at at the $XXX,XXX. that it a Woodland per XXX

So each if but if price at acre was in you sold into $XXX,XXX, an million mix pretty per appreciation, you one MPCs, helps can and Summerlin less Hills because strong. a see lot dig in $X.X Woodland of acre we at which the

Thanks Okay. nice for quarter. the

Tony. you, Thank was pleasure. a It

And line BMO of with from Markets. question comes our John next Kim Capital the

On unchanged, momentum, strong but guidance that basically about you it's the year over is a the lot Dave, half flat you the the the NPC implying and of that second talked left results first that's a uncertainty on rate reason Or the and lot that? well. why as declining of half driving environment based super timing? are factors Is kept there unchanged interest you other it

first half To of look, the you year, very sales ever year and the the for does look, is an conservative was the the year, with in a history remarkable. the the already for of second want land while that be for And in result, beyond on overaggressive. Howard half if it, nothing Well land approach of hang history half on I implies And year the year have under of of consistent year year, half just take half our over the overly even myself we I organization this the what the residential first of prudent implication a and second the cautious know question delivered maybe some residential short guidance second we delivering. And on I'm of that Hughes our that think stretch in marks hat that prides but the the overly environment a best Hughes. of little itself Howard bit may sales. promising to I best I as and the about or of pride think

XX last with has it's rates so has how month, know I impact And how or had? your in much of But the days been pretty last an down. been conversations trended? it's interest volatile the year-to-date. homebuilders trending In

the months. the Look, consistent the sales been I the decrease also that have strong consistent been say with tell summer slower season. would I the previous in We're I mortgage -- a and getting don't you quarter picked rates. wouldn't They've second throughout very up quarter. throughout home into sales home first modest with and have

mortgage maybe positive the the haven't seen relative or demand I the of So an coming lower this in underlying rates to prognosis increase I is actually as a see -- years, year given in uptick. slight into second past don't rates. an the of half downtick but

been just us consistently strong, news. great it's think which for I is pretty

events time On it, and come you just year, what turn think comment Building new you bit on last around going could do down. come do maybe down under it's at What the surprising. well. Seaport, last a is this have the turns maybe think forward? but Tin revenue you management. versus year which that looking as But it around

been seen have I think some year-over-year we've weather-related. that headwinds

in the drop the company there's public of lot really companies public a sponsorship other a I that for results, lot board own and that's a been pulled And specific. across don't think of I event revenue I living, pressure. a there's Seaport as and think been business restaurants

been New and and on spending has has York. spending in been think and down beverage I restaurants food down

skills done talent we on to and really wanted I entirely and humming quarters the job a profitability, not the before focused. think that all the organization, today. team the to it's process think But overhead, has labor incredible takes set time the to costs, time. month run focused will is that And And value. that management in exactly the just magic unlock matter right get it maximizing It's that of there wand It a business way really I that has of team costs, talent is I rightsizing food margins, starts that an overnight. to right. team just and it Anton it a and take the -- think skill bringing

office, commercial you your quarter. on portfolio. good leasing specifically final My had this momentum which is Okay. question

buy amount And the made Looking through during How a the inventory you during months, more time office? this what why can of here, XX occupancy office trending do have lease the on over about if acquisitions comment X% frame? we expirations, next quarter, to you out modest you you XXXX. profit see XX do in

$X and at alone. are office for across the look which great leases million absolutely over and go abatement what's year, if No, what's portfolio, portfolio we lease but Yes. signed pretty million. that to signed think quarter we the remove portfolio in term had about then And will questions. kick excited a been 'XX Look, periods increase I'm the $XX hasn't if you proud and grows And from been of million that to performance the of at year-over-year back number in that our XXXX you you in prior that the commenced, back XX% look you I fees $X 'XX, actually as about. office saw in

I expirations ours I So while has expirations, very manageable. we have think and everybody think are

board is cash and will demonstrated I think in leasing in a we the by across demand, great positive increase that throughout a in XX% momentum as kick NOI at have that the in 'XX. portfolio 'XX occupancy of and lot

Plaza the And II end, Waterway Woodlands. and here downtown our is XX% months of in I of we've the seen next momentum see in right the executing is the specifically think that to where to over heart that at the on, higher here leasing given the full demand the Waterway in demand. XX continue that have that essentially trends and on we're XX%, we portfolio course here

vacant the the highest returns earlier, as heart a a strategy deliver immediate on that, where on buying the very list. to it's and and at is Class we lease-up that today. where building, return can't invested, space I building day our than we into up. leased unlevered a about little property in purchase think X an and us I XX% quickly upon which in can double going is replicate provides on very yield we share execute pass I A on the returns stabilization, basis risk-adjusted Waterway This can get a couldn't we're an demand gets incredible more of our But digits honestly, on And development square and portfolio XXX,XXX one we over feet, have buybacks, a cash achieve double-digit unlevered cash-on-cash on capital cash the mentioned if quickly think

the I've you this couple -- in Woodlands next one if even that prepared And that site this look, the the decades, the and of think the covered to value X-acre about is mentioned for just in it garage. have heart plays in think term, of a by the land the it got And was my we free with adjacent over long doesn't potential Dave redevelopment space include for parking best remarks Striph. of It's career. seen the dirt at

is super says creation for we're top is about of list the over value I portfolio buying seen a couple our office pass a shareholders any we've at higher be other excited. view, is opportunity couldn't and drive result, as than past and quarters the look we this our opportunity we and everyone speak in our just the the but portfolio office in on. results the contrarian So all shouldn't to because know otherwise. dead, And of

rate cap on the initial that was acquisition? What

the to I of with purchase our nature seller. we've and that agreement sale don't due the believe confidential reported

into supplemental, NOI in rate actually a able quarter I that at building. think feels back will we what and the rate think reported smells XX% as for a full a and when we everyone cap to cap you like be see the looks next is market

of line Abramowitz question next Jefferies. the Our Peter comes from with

and guidance. on the Just a full MPC year the question

comfortable strong see sort a was? quarter back, make of raise You kind range. would guidance, year would taking that what on just superpad to the same or be you that how And on guess of in -- you second comments your track from what earlier need the about maintaining I Summerlin. you sales based earlier step kept in to that to seem in particularly given the

think home I Look, sales, dirt acceleration an see to more to we'd which what I want appetite that builders they for the than would would lead have it. have new believe currently think me that buy of to

the builder factor is flattening guidance EBT us prices, price to keeping another our back that go think past years, I meaningful where Over home our increased X slowing or largely that into of acceleration the the the pricing Peter, increased across the if EBT, right? been that it has led home a communities. participation result MPC you of component MPC of of is,

coming modestly As participation prices slowing flat is home is that and down. or increasing acceleration builder price staying are

price Again, guidance across underlying home think per give more in record a from also delivering demand is just from and land confidence I And sold, sales. us portfolio, for us while which therefore, MPC which by and the that increase number home dirt increase is are the EBT homes, acre a sharp And guidance our strong, they're in of home is implied in of builders price in acres or sales in to us guidance. builder appreciation. confidence driven that largely correlated sales price which what's sales could year uptick the increase to an would of an residential highly give

to look Okay. it, at helpful. sort then And but other, I of a asked That's John it guess, perspective. one from longer-term maybe

just getting better, but in slowly, office portfolio maybe I of today you long-term kind the perspective, least at of from your a guess office overall, stabilized at market is about portfolio? in think XXs and kind office XX%-ish occupancy the high leased occupancy to sort as Your inflect we seeming occupied should of the potential look how with in

a least I Vegas, great concentrated imagine is that and Summerlin the negotiation vacancy easily Well, low into Woodlands unfortunately it's in in our about can I low the here the XX% prepandemic, Across to XXs absolutely at one what's getting stabilized XXs. One now, Woodlands already XX% in the downtown and think with used at XX%, were back the Overall, is and portfolio that entirely XX%. X,XXX some the we we're landing maybe above not buildings not level bankruptcies. some really think And that in and Two Woodlands occupancy XX%. I enjoyed we're that full. in but is almost right had

say can hope pretty So I fancy but think XX% I forever, number. we that's a so,

Corporate the the we've it's And really assets the have there Row vacancy that what full areas decided other And and assets, Merriweather numbers have vacancy concentrated our in older portfolio. of the newer in from of tenants seen some the are home smaller work assets greater as to almost bit have than entirely the Row then we a the assets, portfolio. in Columbia

would we seen little buildings. office than demand incremental It's seen haven't tell asked, are we in that. older you the that seeing we've a the I a question of we're where you been to point turn a inflection seeing we've new past over your bit move-outs. And that minute that more that's Columbia And in XX seen since that nice days, in downsizing

So the think that higher over quarter see we drive quarters. some past it's coming this over that will demand to incremental nice

Housing next line Center. from Alex with Research of the comes Barrón Our question

quarter, timing I the them of condo to of quarter? Victoria I spill has you closings. in in anticipate most XXXX? wanted scheduled happen started lot believe, the ask the Yes. is of wondering, fourth about Place, but closings into I was that Or over to -- to start will do a

his tried remarks. Carlos good question, in it's I and a one it's think I mention Alex, believe So that prepared to

piece that that the expect One is the be of we of that a Victoria that revenue increase we -- was increase And piece a to than sales guidance of of in things closings we previously XXXX our less did condo meaningful Place did. our increase guidance. this with quarter

XXXX. condo Our And million. approximately to expected previous from million contemplates new $XX guidance today's $XX fall into to $XX closings Place million of guidance Victoria

is there construction very the going So well.

we in of lot XXX% units majority confidence XXXX. slipping of get there. and done we that that can sold think potentially It's out buyers in vast our XXXX less a into have We the those

quarter profit on you no be And approximate at when that Ulana maybe or my a slight because is scheduled one close? have understanding tower then an in next will workforce? correct that, And XXXX, the one that Okay. breakeven to it's is do

Correct.

tower workforce breakeven-ish is Ulana It's a a inclination and driver. it's a not profit Your tower.

you when but closings. those expect housing to I as that we timing be you workforce better XXXX, provide will think to some give for a on an the again, is be that that benefit, when not But guidance benefit cash highlighted able tower. earnings we'll

this think been quarter, I then big Summerlin, Historically, big more. I you this but And sell quarter. had superpads. Okay. On time, guys could usually if chunk fourth more you one one it's Awesome. of ask a the sale in

there's be much potentially to out mean more coming the not of that of the that half year does or back in Summerlin So revenues not necessarily? going

more strong great No. third very in quarter. quarter see sold we give a with that believe will a third will Summerlin superpads us I that

them of the I quiet that this takedowns fourth be several because fourth May the think past year, has of quarter the been unlike of kind acceleration of superpads by market the in our in that's builders and years, quarter in demand and meet close to their the to lands quarter as Summerlin. want highlighted, these big you are for let a start for quarter. portfolio second on and desperate and these that third the pads and

Thank you. any I'll now remarks. David hand for closing CEO, O'Reilly, the call to over back

interest. we long because morning time. we're join more if your we've of a than hope for our of calls today all Thank November think appreciate there's around as you. I can the Really that Day always any We on is right questions available. Summerlin. had follow-up all should questions, have we participation. Friday Investor And in Thanks this NAREIT in you all of for our appreciate participation have earnings everyone's and And always us maybe

and Ladies and program, for participating. today's gentlemen, now you thank This you may disconnect. concludes