2016 Annual Review
6
2016
Annual
Review
01
-
CEO Letter
to Shareholders
68
-
HHC by
The Numbers
71
-
Together
We Make
Extraordinary
FORWARD-LOOKING STATEMENTS:
Statements made in this letter that are not historical facts, including statements accompanied by words such as “anticipate,” “believe,” “estimate,” “expect,” “forecast,”
“intend,” “likely,” “may,” “plan,” “project,” “realize,” “should,” “transform,” “would,” and other statements of similar expression and other words of similar expression, are
forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934. These
statements are based on management’s expectations, estimates, assumptions and projections as of the date of this letter and are not guarantees of future performance.
Actual results may differ materially from those expressed or implied in these statements. Factors that could cause actual results to differ materially are set forth as risk factors
in our most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission. In this letter, forward-looking statements include, but are not limited
to, expectations about the performance of our Master Planned Communities segment and other current income producing properties and future liquidity, development
opportunities, development spending and management plans. We caution you not to place undue reliance on the forward-looking statements contained in this letter and do
not undertake any obligation to publicly update or revise any forward-looking statements to reflect future events, information or circumstances that arise after the date of this
letter except as required by law.
NON-GAAP FINANCIAL MEASURES
The Company believes that net operating income, or NOI, a non-GAAP financial measure, is a useful supplemental measure of the performance of our Operating Assets
because it provides a performance measure that, when compared year over year, reflects the revenues and expenses directly associated with owning and operating real
estate properties and the impact on operations from trends in rental and occupancy rates and operating costs. We define NOI as operating revenues (rental income, tenant
recoveries and other revenues) less operating expenses (real estate taxes, repairs and maintenance, marketing and other property expenses). NOI excludes straight line rents
and amortization of tenant incentives, net interest expense, ground rent amortization, demolition costs, amortization, depreciation, development-related marketing costs and
Equity in earnings from Real Estate and Other Affiliates.
We use NOI to evaluate our operating performance on a property-by-property basis because NOI allows us to evaluate the impact that factors, which vary by property, such
as lease structure, lease rates and tenant base have on our operating results, gross margins and investment returns.
Although we believe that NOI provides useful information to the investors about the performance of our Operating Assets due to the exclusions noted above, NOI should only
be used as an additional measure of the financial performance of such assets and not as an alternative to GAAP net income (loss).
For a reconciliation of NOI to the most directly comparable GAAP measure see the Supplemental Information at the end of this letter. No reconciliation of projected NOI is
included in this letter because we are unable to quantify certain amounts that would be required to be included in the GAAP measure without unreasonable efforts and we
believe such reconciliations would imply a degree of precision that would be confusion of misleading to investors.
April 28, 2017
To the shareholders of
The Howard Hughes
Corporation from the
Chief Executive Officer
– David R. Weinreb
In the six years since the emergence of The Howard Hughes Corporation as a
publicly traded company, we have been singularly focused on building our
business and unlocking the value inherent within our portfolio of diverse real
estate assets.
We are in the early stages of our journey
reinventing the Howard Hughes legacy.
As the company evolves into a revenue-
generating portfolio of assets with a
management team that has expertise
across our businesses, we are “still reaching
for the sun”1 – with a goal to create one of
the great companies of our time.
We have made meaningful strides transforming raw land and underutilized real
estate into vibrant destinations that generate substantial recurring cash flow
while assembling one of the strongest real estate platforms with expertise
across planning, development, operations, capital markets, marketing, digital,
and sponsorship. We have a large, geographically diverse portfolio with a book
value of approximately $6.4 billion as of December 31, 2016. This diversity
enables us to allocate our capital and expertise for optimal returns throughout
the real estate cycle while mitigating our exposure to any one local economy
or business segment. While we are diversified across product type, we are
concentrated in five markets: the Seaport District in New York City; Columbia,
Maryland; our Houston master planned communities (“MPCs”); our Summerlin
MPC in Las Vegas; and Ward Village in Honolulu.
Our unique business model is best understood by focusing on our three
business segments: MPCs, Strategic Developments, and Operating Assets. The
combination of these three segments provides us with important competitive
advantages.
We are the largest real estate owner in
our MPCs, controlling supply and price
across product types, where we build small
cities that are their own ecosystems and
high-barrier sub-markets.
1) Marvin Humes, The Best is Yet to Come, 2016
1
PIER 17, SEAPORT DISTRICT - NEW YORK CITY
UNDER CONSTRUCTION
CEO Letter To Shareholders
Our control gives us the unique ability to capture demand ahead of the
curve and accelerate development by focusing on a given product mix
based on market needs. Our development expertise and ownership
of a broad array of real estate product types gives us a competitive
advantage compared to other specialized real estate owners. Our cash
flow characteristics also give us a competitive advantage compared to
other pure development companies. We are able to use the cash flow
from our MPC land sales and a growing operating portfolio to self-fund
the equity requirements of our substantial development pipeline, which
exceeds 50 million square feet of entitlements.
One can think of our business as an ecosystem. By controlling large
swaths of land in superb markets, we have the ability to deliver value
not only by product or by asset, but directly to the consumer. As the
master developer of each of our communities, we control the land and
development rights; no new building can be built without our approval.
This allows us to limit supply and carefully control the experience of
each person living or working in our communities. Restricting supply
gives us pricing power, protects against recessionary environments, and
allows us to benefit greatly in growing markets.
The combination of our three
complementary business segments
creates a virtuous cycle:
•
•
•
•
•
We sell land to residential homebuilders in our MPC segment
and the new homes attract residents to our cities looking for
places to work and shop. The cash flow harvested from the sale
of land to homebuilders funds the construction of our strategic
developments.
New homeowners generate demand for commercial developments
including retail, office, and hospitality offerings, which we build
only when the timing is right, mitigating development risk.
Once our strategic developments are completed and stabilized,
they transition to our Operating Asset segment and increase
our recurring Net Operating Income (“NOI”), providing additional
funding for the equity requirements of our Strategic Development
segment.
New office, retail and other commercial amenities make our
MPC residential land more appealing to buyers and increase the
velocity of land sales at prices that exceed the broader market.
Increased demand for residential land generates more cash flow
from our MPC segments, and the virtuous cycle continues.
TOGETHER, WE BELIEVE THESE
FACTORS WILL CONTINUE TO
PROVIDE HHC WITH SOME OF THE
HIGHEST RISK ADJUSTED RETURN
OPPORTUNITIES IN THE PUBLIC
REAL ESTATE SPACE.
Red Rock National Park, Summerlin
AEO & Whole Foods Market Under Construction, Ward Village
Land
Sales
Strategic
Developments
Operating
Assets
2
Hughes Landing, The Woodlands
3
HHC Annual Review 2016CEO Letter To Shareholders Financial Results
Our financial results demonstrate the progress
we have made in unlocking the value of our asset
base. Our annualized fourth quarter 2016 NOI of
$156 million is a 31% increase over full year
2015 NOI of $119 million. Consolidated revenue
increased by $238 million, or 29.8%, to $1 billion
compared to 2015. It is worth noting that our NOI
does not yet reflect the full impact of a number of
projects placed into service that will stabilize in the
coming years. As of December 31, 2016, we had over
$665 million in cash on hand. This cash is sufficient
to fund all equity requirements at developments
currently underway.
2015
$119m
Net Operating Income
Waiea Amenity Deck, Ward Village
4
$665m
Cash on hand
+49%
2016
$156m
Net Operating Income
+31%
5
HHC Annual Review 2016CEO Letter To Shareholders
Other meaningful
accomplishments are
highlighted below:
AOL Live Event, Seaport District
The Westin Hotel, The Woodlands
THE SEAPORT DISTRICT
• Sold the 80 South Street Assemblage for $390 million
($477 per square foot), significantly bolstering our cash
position, priming us for new opportunities, and preparing
the company for changes in the real estate cycle. 80 South
Street was an example of our team’s innovative approach
and ability to complete large, complicated transactions, as
we generated approximately $141 million in profits on this
deal over a 15-month period.
DOWNTOWN COLUMBIA
• Received approval for a $90 million Tax Increment Financing
(TIF) to support infrastructure for approximately 5,000,000
square feet of development.
• Completed the development of One Merriweather, a 199,000
square foot office building in Downtown Columbia that is
42% leased to MedStar Health.
• Began construction on Two Merriweather, a 130,000 square
foot office building in Downtown Columbia that is 75%
preleased.
• Began construction on an additional 437 units of multi-
family apartments in Downtown Columbia with our joint-
venture partner Kettler in our m.flats/TEN.M project.
• Acquired two office buildings in Downtown Columbia for
approximately $36 million: One Mall North and the American
City Building. Obtaining control of these assets unlocks 1.5
million square feet of future development within Downtown
Columbia’s existing entitlements.
HOUSTON
• Completed and opened the 302-room The Westin hotel
SUMMERLIN
• Completed a 20-year ground lease in Downtown
in March 2016 located at The Woodlands.
• Executed a lease and build-to-suit agreement with the
University of Texas Medical System in The Woodlands
for a 203,000 square foot medical building.
• Commenced construction of our second self-storage
property, consisting of 784 units, which is scheduled
to open at the beginning of the second quarter of 2017.
The first self-storage property, consisting of 654 units,
opened during the first quarter of 2017.
• At Bridgeland, new home sales increased
approximately 67% year-over-year due, in part, to
our ability to deliver optimal lot sizes to align with
changing market demand.
Summerlin for a state-of-the-art practice facility for
the new NHL team in Las Vegas, the Golden Knights.
• Completed and opened, in partnership with Calida, the
Constellation, a 124-unit multi-family property located
in Downtown Summerlin that is 66% leased.
• Continued the development of The Summit in
partnership with Discovery Land Company. As of
December 31, 2016, the luxury golf-course community
located in Summerlin had over $226 million in
contracted sales since inception.
6
7
HHC Annual Review 2016CEO Letter To Shareholders WARD VILLAGE
• Contracted to sell approximately
$341 million in homes at Ward Village
in 2016, bringing our total sales to
date to $1.4 billion since launching
pre-sales of our first buildings in
early 2014.
• Delivered our first residential
building, Waiea, in November 2016
with 92% of the 174 units contracted
for sale as of December 31, 2016.
• Continued construction of Anaha,
our second condominium tower, on
schedule for completion in the third
quarter of 2017. The building had
approximately 94% of the 317 units
contracted for sale as of December
31, 2016.
• Commenced construction of Ae`o,
our third condominium tower at
Ward Village to be constructed
above Honolulu’s flagship Whole
Foods Market, which is also under
construction. Ae`o is scheduled for
completion by the end of 2018. As of
December 31, 2016, the building had
265, or 57% of the 466 units, under
contract.
• Commenced construction of Ke
Kilohana, our 424-unit condominium
tower at Ward Village. Scheduled
for delivery in 2019, Ke Kilohana will
include 375 workforce housing units
and 49 market rate units with a CVS/
Long’s Drugs located in the base of
the building. As of December 31,
2016, the building had 386, or 91% of
the 424 units, under contract.
DISPOSITIONS
• Closed on a 72-acre land sale to
Charles Schwab Corporation for the
development of a regional corporate
campus at Circle T Ranch in Westlake,
Texas, in partnership with Hillwood
Development Company, Ltd. This
transaction paves the way for future
mixed-use development on our
remaining land.
• Sold Park West, a non-core open-air
shopping center in Peoria, Arizona,
for $33 million, unlocking an $18
million tax benefit.
• Closed on the sale of a parcel of
land at The Elk Grove Collection in
January 2017 of approximately 36
acres for gross sales proceeds of $36
million. The disposition accelerated
the monetization of land value at
the asset while allowing us to retain
upside in the remaining 64 acres,
which we plan to develop. In addition,
we will recognize a tax loss on this
sale of $38 million as our tax basis
in the asset was substantially higher
than our sale price.
•
The proceeds from these dispositions
will allow us to redeploy capital
into acquisitions and strategic
developments.
OTHER
• Converted a 20,000 square foot
restaurant space into a 35,000 square
foot Nordstrom Rack at the Outlet
Collection at Riverwalk. The retailer
opened for business in October 2016.
• Acquired the Macy’s parcel at
Landmark Mall in Alexandria, VA for
$22 million, which will accelerate
the timeline to begin redeveloping
this site.
8
9
• CONTRACTED TO SELL
APPROXIMATELY $341
MILLION IN HOMES AT
WARD VILLAGE IN 2016,
BRINGING OUR TOTAL
SALES TO DATE TO
$1.4 BILLION
SINCE LAUNCHING
PRE-SALES OF OUR
FIRST BUILDINGS IN
EARLY 2014.
Waiea Entrance, Ward Village
HHC Annual Review 2016CEO Letter To Shareholders Hughes Landing under construction 2015, The Woodlands
Summerlin, Las Vegas
Tipping the Scale
The substantial achievements highlighted above and in
my previous shareholder letters do not always translate
into immediate share price appreciation. To quote
renowned value investor Benjamin Graham:
In the short run, the market is a
voting machine but in the long
run, it is a weighing machine.
While over the past six years our focus has been on
building our business and increasing the value of our
assets, we recognize that market value is the ultimate
barometer of success for a publicly-traded company.
During the past two years, our market value has
fluctuated within a relatively small range.
TOTAL RETURN COMPARISON (INDEX = 100 AT INCEPTION)
We currently trade well below our view of net asset
value, however, we ascribe to Graham’s philosophy
that a company’s actual business performance will
determine its long-term value over short term investor
sentiment.
T H E P O W E R
O F T H R E E
As a result, we are sharply focused on maximizing
our recurring income and the net asset value of our
holdings. As a developer of large-scale, mixed-use
properties and master planned communities, we
operate with a long-term mindset and our shareholders
have benefitted from this approach to managing the
business. Since our emergence as an independent
public company in November 2010, HHC’s share price
has grown at a compounded annual growth rate of
approximately 20%, outpacing the growth of the S&P
500 (13%), the MSCI US REIT Index (11%), and iShares
Dow Jones U.S. Real Estate ETF (10%).
Developing master planned communities is a marathon,
not a sprint, and we are still in the very early stages of our
goal of creating long term shareholder value. We have just
begun to achieve our potential; our 50 million square feet
of remaining entitlements are more than 12 times our total
development activity over the last six years.
Despite the substantial business progress we have made
in the last two years, our shareholder returns over the
same period have not reflected this progress. Given the
relative complexity of our business model, we recognize
there is an opportunity for us to bring increased clarity
and transparency to our assets and valuation potential. In
2017, we have begun and will continue to introduce several
initiatives that are outlined below so that our investors can
better estimate the intrinsic value of the company:
• Host quarterly conference calls in which we articulate
the company’s results. As we continue to transform
our developments and land holdings into operating
assets that generate meaningful recurring cash
flow, it is now time to provide additional insight into
those assets. On our earnings calls, we will explain
our outlook for each business segment and answer
investor questions.
•
Introduce new supplemental disclosures that will
provide metrics for investors to monitor our growth.
• Host our first investor day in May 2017. This event will
provide our stakeholders with an opportunity to learn
more about HHC through an in depth review of the
company presented by our senior leadership.
• Work to expand research coverage to improve
awareness within the investor community.
Together, we hope these initiatives will assist existing
and potential shareholders in understanding the
Howard Hughes story.
10
11
Aligned Incentives
As mentioned in my past shareholder letters, upon joining
HHC I invested $15 million in the company, with Grant
Herlitz, HHC’s President, investing $2 million, both in
the form of long term warrants. Throughout my career in
real estate, I have invested my own capital in ventures I
support. This commitment to having “skin in the game” is
at the core of our investment philosophy at The Howard
Hughes Corporation. This year, I plan on purchasing a new
$50 million warrant and Grant has agreed to purchase a
new $2 million warrant. These warrants will be granted
only if the shareholders approve their issuance at the
upcoming shareholder meeting and, if the shareholders
approve the grant, we will pay a fair market value purchase
price for these warrants.
Investing this capital is a testament to our steadfast
confidence in HHC’s growth prospects as we will not
benefit from any gain in the warrant unless the stock price
trades meaningfully above its current price. At the same
time, we will lose our entire investment in the warrants if
the share price remains flat.
WHILE WE CANNOT GUARANTEE
SUCCESS, OUR INTERESTS ARE
ALIGNED WITH SHAREHOLDERS
AND YOU CAN BE ASSURED
THAT WE WILL SUCCEED OR
FAIL TOGETHER.
HHC Annual Review 2016CEO Letter To Shareholders T H E P O W E R
O F T H R E E
HHC Value Creation -
Three Complementary
Business Segments
We operate in three complementary business
segments: MPC, Strategic Development,
and Operating Assets. The combination of
these three segments enables us to control
supply and use our scale to drive operating
efficiencies, become the dominant player in
our core markets, and deliver outsized risk-
adjusted returns. We think of our communities
as customer centric ecosystems. Our
customers live in our homes, work in our office
buildings, and shop at our retail destinations.
Our ability to control supply protects our downside in recessionary environments
while allowing us to benefit during times of growth as we are able to accelerate
development and bring product to the market faster than our competitors. The
development of Hughes Landing is an excellent case study. Since 2013, at Hughes
Landing, we have developed 1.4 million square feet of Class A office, 390 luxury
multi-family units, 126,000 square feet of retail and a 205-suite Embassy Suites
hotel on 66 lakefront acres that together will generate $45 million of stabilized NOI.
1.
MPC
STRATEGIC DEVELOPMENTS
2.
T H E P O W E R
O F T H R E E
3.
OPERATING ASSETS
12
110 North Wacker Drive, Chicago
13
HHC Annual Review 2016CEO Letter To Shareholders 1.
Master Planned
Communities
Aerial of Summerlin, Las Vegas
In our MPC segment, we plan, develop and manage small cities in markets with strong
long-term growth fundamentals, including The Woodlands, Bridgeland, and The Woodlands
Hills in Houston; Summerlin in Las Vegas; and Columbia, Maryland. This business involves
the development of residential land and selling the improved acreage to homebuilders
for the eventual sale of homes to new residents. Combined, our MPCs span over 80,000
residential acres, approximately four times the size of the island of Manhattan, and are home
to a population of over 342,000 residents and 160,000 jobs. We leverage our expertise by
differentiating each of our communities within a distinct environment and unmatched amenity
base, further fueling demand for homes and commercial development.
A summary of the undiscounted and uninflated value of our MPC land holdings, exclusive of
vertical developments and operating properties, is presented below:
MPC GROSS SALES VALUE
Remaining Saleable and
Developable Acres
Average Price per Acre 1,2
($ in thousands)
Projected
Community
Average Cash
Margin
Undiscounted / Uninflated Value
($ in millions) 3
Community
RESIDENTIAL
COMMERCIAL
RESIDENTIAL
COMMERCIAL
SELL-OUT DATE
RESIDENTIAL
RESIDENTIAL
COMMERCIAL
Bridgeland
Maryland4
Summerlin5
The Woodlands
The Woodlands Hills
Total
2,518
-
3,778
314
1,499
8,109
1,530
108
826
788
171
3,423
372
-
577
560
207
394
316
759
957
552
2037
2022
2039
2025
2030
69%
-
68%
98%
81%
646
-
1,482
172
251
2,551
603
34
627
754
94
2,112
Total
1,249
34
2,109
926
346
4,665
Notes:
1) Residential pricing: average 2016 acreage pricing for Bridgeland, Summerlin and The Woodlands. Summerlin average pricing excludes the sale of approximately 117
acres to Pulte with an atypical economic structure. Pro forma acreage pricing for The Woodlands Hills.
2) Commercial pricing: estimate of current value based upon recent sales, third party appraisals and third party MPC experts. The Woodlands Hills commercial is valued at cost.
3) Pre-tax cash flow estimates.
4) Maryland commercial acres exclude land in Downtown Columbia that is held within our Strategic Developments segment.
5) Summerlin excludes 555 acres contributed to the Summit joint venture at an agreed upon value of $225,000/acre.
Summerlin MPC, Las Vegas
$180M
2016 EARNINGS BEFORE TAXES
$1O0M+
2016 REVENUE AT SUMERLIN
8,100
ACRES REMAINING TO
BE DEVELOPED & SOLD
ACROSS OUR MPC’S
Our MPC segment generated earnings before taxes of
approximately $180 million for 2016 and for the past
three years has averaged earnings before taxes of
approximately $172 million. It is worth noting that our
cash margins at The Woodlands are approximately 98%
due to the fact that The Woodlands residential is at the
end of its lifecycle and almost all of the infrastructure is
already in place.
The earnings and cash flow generated from this segment
is one of the elements of HHC that sets us apart from
other real estate companies. Unlike other developers
who have few sources of recurring cash flow, our cash
flows from operating assets and our MPCs have enabled
us to internally fund our developments without having to
raise equity and dilute our shareholders.
Summerlin is a good example. In 2016, Summerlin
generated over $100 million in land sales and
participation revenue, exceeding the $100 million
mark for the fourth year in a row. In 2014, we used
approximately $106 million of cash generated from
land sales and contributed land held at a book value of
$17 million to develop the first stage of our urban core
in the heart of the community, Downtown Summerlin:
a 1.4 million square foot lifestyle destination with
retail and office space. At stabilization, we estimate
that Downtown Summerlin and ONE Summerlin will
generate approximately $32 million of recurring net
operating income. While the value creation resulting from
delivering this development at its expected stabilized
yield is clear, what is often missed are the other benefits
that it generates for the broader MPC. By providing this
amenity to Summerlin, we have increased demand for
homes in the community as evidenced by a 22% increase
in the price of residential land sold to homebuilders
since Downtown Summerlin opened.
As the master developer and majority landowner in
each of our communities, we have a high degree of
influence and understanding of both the local economy
and the microeconomy of the MPC. The self-contained
ecosystem that we have created within each of our
communities has yielded a significant price premium
over comparable homes outside of our master planned
environment and has helped shield our properties from
external economic pressures. Case in point: our Houston
MPCs. Even though Houston’s economy has experienced
a slowdown over the last two years, Bridgeland enjoyed
a record year in 2016 with new home sales up more than
67% from 2015. In The Woodlands, the office market
experienced positive net absorption in 2016 and all of
our tenants are performing their obligations, with some
expanding their footprint by taking additional square
footage within our office portfolio.
With over 8,100 residential acres of land remaining to be
developed and sold across our communities, we have
substantial untapped value and significant expected
future cash flows to be generated. In addition to the
residential land, our MPC segment contains more than
3,400 acres designated for commercial development or
sale to non-competing users such as hospitals. This land
is held in our MPC segment until we identify demand for
a new commercial development, at which point the land
is transferred into our Strategic Development segment.
14
15
HHC Annual Review 2016CEO Letter To Shareholders
2.
Strategic
Developments
50M
SQ FT
OF VERTICAL
DEVELOPMENT
ENTITLEMENTS
WITHIN OUR
PORTFOLIO
Anaha, Ward Village
I am often asked by shareholders about HHC’s future growth. Although we are constantly on the lookout for
great acquisition opportunities, we have the luxury of being patient given our more than 50 million square feet
of vertical development entitlements embedded within existing assets. Below is a table outlining an estimate
of our remaining entitlements:
REMAINING ENTITLEMENTS
(IN MILLIONS)
3.
Operating Assets
The vast majority of our operating
assets are located within our MPCs.
This helps us achieve scale and, in
most cases, critical mass, which
leads to pricing power in lease and
vendor negotiations. Furthermore, it
enables us to attract, hire and retain
the best local leadership and leasing
teams, provides us flexibility to meet
changing customer demands, and
an enhanced ability to identify and
capitalize on emerging opportunities.
These competitive advantages,
in turn, lead to higher rental
rates, better customer retention,
higher occupancy, lower operating
expenses, and greater operating
margins.
One of the most readily
understandable demonstrations of
our value creation is the substantial
and increasing recurring cash
flow we generate as seen in the
company’s increased NOI. In 2010,
our company generated recurring
NOI of $49 million. As of our most
recent fourth quarter, our annualized
NOI was $156 million, a compounded
annual growth rate of over 21%.
We have achieved these increases
without the need to raise equity
since we became a public company.
We forecast that our recently
completed projects and those under
construction, excluding the Seaport,
will generate about $232 million of
NOI at stabilization.
OPERATING ASSETS NOI ($ in millions)
Incremental contribution to operating
assets NOI(1)
Operating assets NOI
232
92
140
232
76
156
g r o w t h
2 1 % C A G R ( 2 )
119
71
55
61
51
49
2010
2011
2012
2013
2014
2015
2016
Q4 2016
annualized
OPERATING ASSETS INCREMENTAL NOI BRIDGE ($ in millions)
Incremental contribution to operating
assets NOI(1)
Operating assets NOI
4 9 % g r o w t h ( 2 )
15
30
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14
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232
76
I
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6
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2
4
Q
16
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i
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Total
8.4
7.0
5.8
12.6
11.3
0.8
Ward Village
The Woodlands
Bridgeland
Summerlin
Columbia
Seaport
Other
4.0
Total
50.0
(1) Potential incremental NOI from recently completed developments stabilizing as well as projects currently under
construction, excluding Seaport District. These projects are substantially expected to stabilize by 2020.
(2) Historical growth is not indicative of future performance.
16
17
Downtown Summerlin, Las Vegas
HHC Annual Review 2016CEO Letter To Shareholders
Five Core Markets
Transforming Vision
Into Reality
Waiea, Ward Village
18
19
HHC Annual Review 2016CEO Letter To Shareholders UNLOCKING VALUE
FROM WALL STREET
TO WAIKIKI
ELK GROVE
CALIFORNIA
SUMMERLIN
LAS VEGAS
In order to illustrate the material value
creation opportunities available with our
existing assets, we have provided a detailed
overview of each of our core assets below,
beginning with our MPCs.
110 N WACKER
CHICAGO
SEAPORT
DISTRICT
NEW YORK
LANDMARK
VIRGINIA
WARD VILLAGE
HAWAII
HOUSTON
MPC’s
RIVERWALK
NEW ORLEANS
DOWNTOWN
COLUMBIA
MARYLAND
KENDALL
TOWN CENTER
FLORIDA
20
21
HHC Annual Review 2016CEO Letter To Shareholders Summerlin
For those of you not familiar with Summerlin, it is the premier place to live in
Las Vegas, with a population today of more than 100,000 residents that will grow
to 200,000 at full build. Named after Howard Hughes’ paternal grandmother,
Summerlin was acquired by the legendary entrepreneur himself in the 1950’s.
This 22,500 acre MPC is located nine miles west of the Las Vegas strip. We are
the largest private land owner in the Las Vegas Valley and have approximately
4,600 remaining saleable and developable acres.
The Summit
Future
Developemnt
Downtown Summerlin
Summerlin MPC, Las Vegas
22
23
HHC Annual Review 2016CEO Letter To Shareholders 200,000
RESIDENTS AT FULL BUILD OUT
$226M
LOTS CONTRACTED AT
THE SUMMIT
Summerlin MPC, Las Vegas
The Summit, Summerlin
With 22 schools, 150 parks, 150 miles of trails, 14
houses of worship, and nine golf courses – all more
than almost any other community in the country -
Summerlin is the place to be if you want to live in
Las Vegas. This is evident in the home prices, with
home values at a more than 20% premium over
other communities in the region. Summerlin has
built a strong brand reputation and benefits from
favorable demographics, with average household
income approaching $140,000 per year.
With Southern Nevada’s economy experiencing
a broad-based expansion, Summerlin continues
to strengthen as a community. Visitor traffic is
at an all-time high, unemployment is at 5.0% (A
900 basis point improvement from the trough in
September 2010), and approximately $18 billion
of commercial real estate development is either
planned or underway in the Las Vegas Valley,
including the future NFL stadium that will be home
to the Raiders. We are well positioned to increase
our share of the market as we further distinguish
the community with the continued development
and growth of Downtown Summerlin. The first
phase of our downtown, totaling 1.4 million square
feet in 34 buildings, was completed at the end of
2014. Last year we broke ground on the practice
facility for the Las Vegas NHL team. We have future
development entitlements of over 5,000,000 square
feet of additional residential, office and retail
space, not including our plans to develop a stadium
in Downtown Summerlin for the Las Vegas AAA
baseball team.
($ in millions)
Asset Type
Square Feet / Units
% Occupied as
of 12/31/16
2016 NOI
Q4 2016 NOI
Annualized
Projected Annual
Stabilized NOI
Operating Assets
Downtown Summerlin (1)
Retail/Office
Constellation (2)
Multi-Family
1,002,722
124
80.0 %
51.6%
Total
$ 19.0
(0.1)
$ 18.9
$ 20.8
NA
$ 20.8
$ 32.0
1.1
$ 33.1
Notes:
1) Includes 206,279 SF of office (ONE Summerlin).
2) Joint venture NOI is shown at 50% ownership interest.
(3) Stabilized NOI is shown at greater of (i) trailing 12-month actual results or (ii) stabilized NOI at time of initial underwriting. In certain situations, current
annualized NOI could exceed projected stabilized NOI as a result of non-recurring items such as lease termination fees.
RESIDENTIAL LAND SALES
We have significant additional capacity at Summerlin with
approximately 3,800 remaining saleable residential acres,
translating to approximately 15,700 residential lots, with
a projected sell-out date of 2039. Our Summerlin MPC
segment generated $111 million of residential land sales
in 2016. For 2017, we expect our residential land sales
business to continue to remain strong and for the fifth year
in a row exceed the $100 million milestone. Average price
per acre in 2016 was $537,000, excluding the $40 million
sale to Pulte Homes. The Pulte sale was unique as the
homebuilder will be responsible for installing power and
drainage facilities to the village. Unlike in one of our typical
sales, HHC is not obligated to incur any development costs
within the boundaries of the parcel.
Current sales volume of approximately 7,000 new homes
per year is half of historical market forecasts that
projected Las Vegas to reach 14,000 new home sales per
year by 2016-2017. Given the recent lack of expansion
in new home sales, we have remained careful to not sell
home builders lots that would put excessive inventory in
their hands. As part of our efforts to increase velocity,
we are focused on developing a product that targets a
broader pool of potential homebuyers. In the greater Las
Vegas region, approximately 70% of home sales are below
$400,000. In Summerlin, with our focus on maintaining its
reputation and brand positioning as a luxury community,
we have historically not met that lower priced segment
of market demand. Most recently, we have been focused
around developing a lot size, structure, and product type
that can both maintain the high quality of product in
Summerlin while allowing us to have a price point that
meets this demand. Our goal is to access this market
demand in 2017 and 2018 using land that would otherwise
not be monetized for many years. This could provide for
both the acceleration of near term cash flows and increase
the net present value of this MPC.
THE SUMMIT
The Summit is our joint venture with Discovery Land
Company (“DLC”) to develop a 555-acre luxury golf course
community that will further differentiate Summerlin as
the place to live in the region. The project delivered its
first lots in 2016 and is performing above plan. We had
contracted to sell 71 lots for $226 million as of December
31, 2016. Early interest has come predominantly from the
local market, which is atypical for traditional DLC projects.
Development remains on schedule and on budget.
The early success of The Summit is a testament to
Mike Meldman, Discovery’s Chairman and CEO, and his
impressive team as well as the strong brand reputations of
DLC, HHC, and Summerlin that together create the perfect
trifecta.
The joint venture distributed $23 million in 2016, and
recorded equity in earnings to us of $44 million. We
expect The Summit to grow substantially as lots close and
we realize the full potential of this unique venture. The
success of this project should also increase the appeal of
our remaining MPC acreage for homebuilders and future
home buyers.
24
25
HHC Annual Review 2016CEO Letter To Shareholders DOWNTOWN SUMMERLIN HAS
STRONG MOMENTUM THAT WILL
ALLOW US TO DEPLOY OUR
5.5 MILLION SQUARE FEET OF
ENTITLEMENTS AND CONTINUE
ENHANCING THE COMMUNITY
WITH OUR NEW COMMERCIAL
DEVELOPMENTS.
Tour De Summerlin, Downtown Summerlin
RETAIL AND OFFICE
MULTI-FAMILY
We continued to enhance the tenant mix at Downtown
Summerlin in 2016, highlighted by the opening of H&M,
Dave and Busters, West Elm, and Maggiano’s. The upgraded
and expanded tenant roster has led to an approximately
20% increase in year-over-year traffic and sales of $577
per square foot, excluding pad sites and anchors. In 2016,
we welcomed over 16 million visitors. Despite these gains,
we experienced headwinds from the Sports Authority
and Golfsmith bankruptcies, soft sales from a handful
of tenants, and lower leasing velocity than we previously
anticipated. NOI for Downtown Summerlin and ONE
Summerlin was $19 million in 2016 and is projected to
grow to $32 million at stabilization, which we now estimate
to occur by the end of 2018. The slower than anticipated
stabilization is primarily due to delayed lease-up and rent
commencement dates as well as the need to replace
non-performing tenants or defaulting tenants.
We completed the Constellation in a joint venture with
Calida in the third quarter of 2016. The 124-unit project
was 66% leased as of December 31, 2016 at average rents
of $1.49 per square foot.
FUTURE DEVELOPMENT
Downtown Summerlin has strong momentum that
will allow us to deploy our 5.5 million square feet of
entitlements and continue enhancing the community with
our new commercial developments.
You can learn more about Summerlin at
www.Summerlin.com
INCREASE IN YEAR-OVER-YEAR
TRAFFIC AT DOWNTOWN SUMMERLIN
Holiday Parade, Downtown Summerlin
Illustrative Rendering of Proposed AAA Baseball Stadium in Downtown Summerlin
26
27
HHC Annual Review 2016CEO Letter To Shareholders Houston MPC’s
The Houston region includes The Woodlands, Bridgeland
and The Woodlands Hills communities. Each of these assets
is in a different stage of the MPC life cycle.
• The Woodlands: With only 1,000 residential lots and approximately 790
acres of commercial land remaining to be developed, the community is
one of our most mature MPCs.
• Bridgeland has nearly 15,000 residential lots and 1,530 commercial
acres remaining for development.
• The Woodlands Hills: Forecasted to deliver its first product to
homebuilders in the latter half of 2017, the new MPC has a full cycle
estimate of 5,000 residential lots to be developed over a 13-year period.
THE WOODLANDS
BRIDGELAND
THE WOODLANDS HILLS
TOTAL
REMAINING LOTS
REMAINING COMMERCIAL LOTS
SELLOUT PERIOD
1,136
788
8
14,827
1,530
19
5,064
171
13
21,027
2,489
Town Center, The Woodlands
28
29
HHC Annual Review 2016CEO Letter To Shareholders DOWNTOWN
HOUSTON
The Woodlands
Created by visionary oil businessman George Mitchell in 1974
with an original concept design inspired by James Rouse’s
master plan of Columbia, Maryland, The Woodlands has grown
into one of the country’s most recognized MPCs over the last
40 years. Today, more than 115,000 residents and several
Fortune 500 corporations call The Woodlands home, including
Anadarko Petroleum, Chicago Bridge & Iron, and Huntsman
Corporation. In addition, several large corporations maintain
regional campuses in The Woodlands such as ExxonMobil,
Chevron Phillips, Baker Hughes, McKesson, and Aon. As a
result of the robust corporate presence, The Woodlands is one
of the largest employment hubs in the region with over 60,000
jobs, helping to maintain economic stability with an average
household income in excess of $110,000.
Hughes Landing, The Woodlands
Since acquiring Morgan Stanley’s remaining 47.5%
ownership interest in The Woodlands in 2011 for $117.5
million and their share in the $261 million of total debt on
the community, we have sold over 3,000 residential lots for
approximately $390 million and 169 acres of commercial
land for $141 million. Today, we value the remaining
land in The Woodlands at $926 million on an uninflated/
undiscounted basis. In addition, we have invested total
capital of approximately $890 million to develop or
redevelop approximately 1.7 million square feet of office,
224,000 square feet of retail, 704 multi-family units, and
913 hotel rooms all of which generate net operating income
of $64 million (annualized as of fourth quarter 2016) and
$89 million of expected NOI equating to a stabilized yield
of 10% on our total project costs. Today, we value the
community at $1.4 billion net of approximately $900 million
of debt.
Below is a brief overview of our operating assets at
The Woodlands.
OFFICE
Our office portfolio in The Woodlands consists of
approximately 2.1 million square feet across 11 properties.
Our office properties range in size and location to satisfy
a broad range of tenant requirements. Our scale allows us
to compete for tenants at every stage of a company’s life
cycle, from small companies searching for affordable space
to Fortune 100 corporations interested in state-of-the-art
build to suit office space.
Total NOI from our office portfolio in The Woodlands was
$32 million in 2016 which is expected to grow to $53 million
once our newest developments in Hughes Landing stabilize.
Below is a table outlining our existing operating office
assets in The Woodlands along with their 2016 projected
annual stabilized NOI.
($ in millions)
Operating Assets - Office
1725 –1735 Hughes Landing Blvd
Three Hughes Landing
3 Waterway
4 Waterway
One Hughes Landing
Two Hughes Landing
3831 Technology Forest
9303 New Trails
1400 Woodloch
2201 Lake Woodlands
Total
Square Feet / Units % Occupied as
of 12/31/16
2016 NOI
Q4 2016 NOI
Annualized
Projected Annual
Stabilized NOI
651,924
321,000
232,021
218,551
197,719
197,714
95,078
97,553
95,667
24,119
2,131,346
73.8%
10.0%
100.0%
100.0%
100.0%
96.3%
100.0%
86.7%
93.5%
30.5%
3.0
(0.5)
6.7
6.5
6.0
5.0
2.0
1.6
1.7
(0.1)
31.9
9.4
NA
7.2
6.7
6.2
8.2
1.8
1.5
1.7
-
42.7
14.4
7.6
6.7
6.5
6.0
6.0
2.0
1.8
1.7
-
52.7
(1) Stabilized NOI is shown at greater of (i) trailing 12-month actual results or (ii) stabilized NOI at time of initial underwriting. In certain situations,
current annualized NOI could exceed projected stabilized NOI as a result of non-recurring items such as lease termination fees.
30
31
HHC Annual Review 2016CEO Letter To Shareholders EMBASSY SUITES
HUGHES LANDING
#1 NATIONAL RANKING
Embassy Suites, Hughes Landing
The Woodlands Resort and Conference Center
Embassy Suites, Hughes Landing
HOSPITALITY
Our hospitality portfolio in The Woodlands consists of three hotels: The Woodlands Resort &
Conference Center, Embassy Suites at Hughes Landing and The Westin. Today, our portfolio is quite
different than it was three years ago. In 2014, we completed a redevelopment and expansion of
the Woodlands Resort & Conference Center that included renovating 222 existing guest rooms and
constructing a new wing of 184 guest rooms and suites. In 2015, we completed and opened the
Embassy Suites at Hughes Landing, which has been ranked the top hotel on the Embassy network.
In 2016, we opened The Westin along The Woodlands Waterway in Town Center.
As a result of the impact of lower oil prices on the Houston economy, 2016 was a challenging year for
our hospitality segment as occupancy was lower than forecasted at both the Resort and The Westin.
We have further optimized the hotels’ operations and they are well positioned to continue to season
in the coming years. In 2016, NOI from our hospitality segment was $13 million, which we expect to
ultimately grow to $32 million at stabilization.
Below is a table outlining our existing operating hospitality assets in The Woodlands along with
their 2016 projected annual stabilized NOI.
($ in millions)
Keys
2016 NOI
Q4 2016 NOI
Annualized
Projected Annual
Stabilized NOI
Operating Assets - Hospitality
Woodlands Resort & Conference Center
The Westin at The Woodlands
Embassy Suites at Hughes Landing
Total
406
302
205
913
$
$
7.6
1.7
3.6
12.9
$
$
7.7
4.6
4.3
16.6
$
$
16.5
10.5
4.5
31.5
(1) Stabilized NOI is shown at greater of (i) trailing 12-month actual results or (ii) stabilized NOI at time of initial
underwriting. In certain situations, current annualized NOI could exceed projected stabilized NOI as a result of non-
recurring items such as lease termination fees.
32
33
HHC Annual Review 2016CEO Letter To Shareholders The Waterway, The Woodlands
WE OWN THREE
MULTI-FAMILY
PROPERTIES IN THE
WOODLANDS THAT TOTAL
1,097 UNITS.
MULTI-FAMILY
We own three multi-family properties in The Woodlands that total 1,097 units. Similar to our office properties,
our multi-family portfolio is uniquely positioned to serve a wide range of residents, from millennials moving
into their first home after college to empty nesters looking for the best amenities a property has to offer. Our
most recent development, One Lakes Edge, is the gold standard for multi-family living in The Woodlands.
In 2016, the NOI of our multi-family segment in The Woodlands was $8.3 million. We expect NOI from this
segment to grow to $17 million once One Lakes Edge stabilizes and Millennium Six Pines contributes our
100% share for a full year.
($ in millions)
Operating Assets - Multi-Family
One Lakes Edge (1)
Millennium Six Pines (2)
Millennium Waterway
Total
Units
390
314
393
1,097
% Occupied
As of 12/31/16
2016 NOI
Q4 2016 NOI
Annualized
Projected Annual
Stabilized NOI
69.2%
85.7%
83.0%
3.6
1.5
3.2
8.3
4.0
3.9
3.4
11.3
7.5
4.6
4.5
16.6
Notes:
1) NOI includes One Lakes Edge Retail.
2) Prior to our acquisition of our partner’s remaining interest in this property in July 2016, we owned an 81.43% interest. The NOI shown here reflects NOI
earned subsequent to the acquisition. Prior to the acquisition, our share of the property’s NOI was approximately $1 million.
3) Stabilized NOI is shown at greater of (i) trailing 12-month actual results or (ii) stabilized NOI at time of initial underwriting. In certain situations, current
annualized NOI could exceed projected stabilized NOI as a result of non-recurring items such as lease termination fees.
RETAIL
We own approximately 308,000 square feet of retail across six properties in The Woodlands. These properties
are primarily located in Town Center and Hughes Landing and offer a variety of dining and shopping offerings
from restaurants such as Truluck’s, Fogo de Chao and Del Frisco’s Grille to grocery stores such as Whole Foods
Market. Our retail portfolio is 94% leased with an average remaining term of eight years. In 2016, total NOI from
our retail portfolio in The Woodlands was $8 million.
Below is a table outlining our existing operating retail assets in The Woodlands along with their 2016
projected annual stabilized NOI.
($ in millions)
Operating Assets - Retail
Hughes Landing Retail
One Lakes Edge Retail1
Creekside Village Green
20/25 Waterway
Waterway Garage Retail
1701 Lake Robbins
Total
Square Feet
% Occupied
As of 12/31/16
2016 NOI
Q4 2016
Annualized NOI
Projected Annual
Stabilized NOI
126,131
23,280
74,669
50,062
21,513
12,376
308,031
97.4%
99.3%
84.5%
97.5%
99.8%
64.1%
$
$
3.4
-
1.5
1.8
0.6
0.4
7.7
$
$
4.2
-
1.5
1.9
0.7
0.4
8.7
$
$
3.5
-
1.9
1.8
0.8
0.4
8.4
Notes:
1) NOI included in One Lakes Edge multi-family NOI.
2) Stabilized NOI is shown at greater of (i) trailing 12-month actual results or (ii) stabilized NOI at time of initial underwriting. In certain situations, current
annualized NOI could exceed projected stabilized NOI as a result of non-recurring items such as lease termination fees.
In addition to the above, we have a pipeline of entitlements that could total more than 7,000,000 square feet.
You can learn more about The Woodlands at www.TheWoodlands.com
One Lakes Edge at Hughes Landing, The Woodlands
34
35
HHC Annual Review 2016CEO Letter To Shareholders
67%
GROWTH
IN YEAR
OVER YEAR
SALES
Bridgeland
Bridgeland was acquired in 2003. Located northwest of
Houston between Highway 290 and Interstate 10, the MPC
originally encompassed over 10,000 acres before an additional
1,234 acres were purchased in 2007. The master plan details
more than 3,000 acres of open space and 900 acres of lakes,
helping to differentiate the community and providing appeal
to buyers. Since construction began in 2004, our predecessors
invested over $300 million into this asset.
Bridgeland’s first homes were sold in 2006. Over the long term,
Bridgeland expects to comprise 20,000 homes and 65,000
residents. Today, approximately 2,800 homes have been sold
and 8,300 residents live in the community. Unemployment
in the local trade area is 5.2% and the median household
income is approximately $100,000. As other MPCs exhaust
their supply of residential lots, Bridgeland stands to benefit
from the continued northern growth in the greater Houston
area as future home owners are attracted to the master plan
environment.
2016 was a robust year for Bridgeland with home sales 67%
higher than in 2015. This performance highlights the demand
that exists for homes priced below $400,000. In order to meet
the market demand for this product, we have altered the mix
of lots that we develop. We sold 296 lots in 2016 with revenue
totaling $21 million.
As Houston grows northwest, Bridgeland will be the beneficiary
of that growth. We expect Bridgeland to eventually achieve
average lot sales in excess of 800 lots per year. Accelerating
our lot sales will pave the way for commercial development and
meaningful growth in recurring income.
You can learn more about Bridgeland at www.Bridgeland.com
Bridgeland, Houston
36
37
HHC Annual Review 2016CEO Letter To Shareholders OWING TO ITS MANY
AMENITIES AND STRONG
SCHOOLS, COLUMBIA WAS
RANKED THE TOP SMALL
CITY TO LIVE IN BY MONEY
MAGAZINE IN 2016.
Merriweather Post Pavilion, Downtown Columbia
Columbia
Developed by Jim Rouse, the father of the MPC business, Columbia
was among the first MPCs in the country. Its strategic position
between Baltimore, MD, and Washington, D.C. enabled it to thrive.
Today, it is home to more than 112,000 residents.
While The Rouse Company sold all of the community’s single-
family residential inventory many years ago, the central core
was reserved for the last stages of development so that it could
become an urban-oriented business and cultural hub known
today as Downtown Columbia. This strategy is consistent with The
Woodlands, which created enormous value by reserving strategically
located “town center” land for commercial development later in the
life cycle of the MPC.
Downtown Columbia is located in Howard County,
which has a population of approximately 287,000
residents and one of the nation’s most educated
workforces. It is at the center of the growing cyber
security industry because of its proximity to Fort
George Meade, U.S. Cyber Command, and the
National Security Agency.
The county is also home to major research institutions such as
Johns Hopkins and companies like W.R. Grace, Accuvant Federal
Solutions, Tenable, and The Coastal Companies. As of December
2016, the Howard County unemployment rate was 2.7%. Household
incomes are high in Howard County with median household
income at over $110,000. Owing to its many amenities and strong
schools, Columbia was ranked the top small city to live in by Money
Magazine in 2016.
Our focus over the past six years has been on the commercial
development plan for Downtown Columbia, which provides us
with the ability to develop approximately 13 million square feet
comprised of 5,500 residential units, 4.3 million square feet of
office, 1.3 million square feet of retail, and 640 hotel rooms. Below
are some updates of our progress over the last 12 months.
On November 9, 2016, The Howard County Council passed
legislation approving up to $90 million in tax increment financing
bonds to fund critical public infrastructure improvements in
the Merriweather District within Downtown Columbia, including
significant roadwork and a 2,500-space parking structure. A TIF is a
vehicle commonly used by jurisdictions around the country to fund
development of public spaces or infrastructure. TIFs use future
incremental tax revenue resulting from the development to finance
the infrastructure needed to accelerate the larger project.
DOWNTOWN
COLUMBIA
MASTER PLAN
BY THE
NUMBERS
5,500
RESIDENTIAL UNITS
4.3M
SQ FT OF OFFICE
1.3M
SQ FT OF RETAIL
38
Merriweather District, Downtown Columbia
39
Broken Land ParkwayHickory Ridge RoadLittle Patuxent ParkwayelcriC llaM aibmuloCLittle PautuxeyawkraP dnaL nekorBGovernRoute 29The Mall in ColumbiaLake KittamaqundiArea FourNorth-South ConnectorBroken Land ParkwayLittle Patuxent ParkwayelcriC llaM aibmuloCyawkraP dnaL nekorBMerriweather DriveThe Mall in ColumbiaMerriweatherPost PavilionLittle Patuxent PkwyBroken Land PkwySymphony Woods ParkMerriweather PostPavilionHickory Ridge Rd.Symphony DriveMerriweather DriveArea TwoArea OneArea ThreeArea FourMerriweather Drive Symphony Woods Road Divided Sky LaneHickory Ridge Road Merriweather Drive Jug HandleN-S Conector N-S ConnectorParkRoad Segment ThreeTIF ParkingGarage ATIF ParkingGarage BProject1OCProject 1OB:Two MerriweatherProject 1OA:One MerriweatherProject 4OAProject 4MFAProject 2OCProject 2MFAProject 2OAProject 3MFBProject 3MFCProject 3OAProject 3OBProject 3REProject 3OCProject 3HAProject 3LRAProject 2OBMetropolitanm.flatsTEN.MHHC Annual Review 2016CEO Letter To Shareholders OFFICE
RETAIL
Through two transactions in recent years, we acquired
10-70 Corporate Center and became the dominant office
landlord in Downtown Columbia, controlling approximately
50% of the supply in the market. Last year, we completed
One Merriweather, the first new office building to be
delivered in Downtown Columbia in decades. Medstar
Health, the region’s largest healthcare provider, occupies
42% of the project and will cover carrying costs while the
remainder of the building is leased.
In 2016, we completed leasing the Columbia Regional
Building, adding NuVasive to the third floor. We
successfully repurposed the former Rouse Company
Headquarters, designed by architecture giant Frank Gehry,
into a dynamic Whole Foods-anchored destination in
Fall 2014. Our Columbia retail portfolio totals 89,000
square feet.
MULTI-FAMILY
We began construction on Two Merriweather, our second
office building in the Merriweather District. Pearson PLC,
an international publishing and education company, will
occupy approximately 55% of the building when complete
at the end of 2017.
Our first multi-family development in Columbia, The
Metropolitan Downtown Columbia, stabilized in 2016.
Distributions in 2016 in the 50/50 joint venture with Kettler
totaled $5 million of which $4 million was a result of
refinancing the debt.
In 2016, under another 50/50 joint venture with Kettler, we
began construction on the 437-unit m.flats/TEN.M project
adjacent to The Metropolitan Downtown Columbia. We
contributed five acres of land to the project valued at $23
million. Additionally, we invested $9 million of capital to
ready the land for development last year.
Below is a table outlining our existing operating assets
in Columbia along with their 2016 projected annual
stabilized NOI.
Additionally, we closed on the purchase of the American
City Building in the Lakefront District. The purchase price
of $14 million is net of insurance proceeds held in escrow
from a previous casualty. While this office building is
vacant, its value lies in our ability to unravel complicated
and restrictive parking easements, which will allow us to
redevelop a significant portion of the Lakefront. We are
hard at work fine tuning a dynamic plan that will accelerate
development opportunities in the market.
In 2016, we purchased One Mall North, a 100,000 square
foot fully leased office building, for $22 million. Without
assigning any value to the improvement, the implied
purchase price of the building would equate to the value
of the land we contributed to our first joint venture with
Kettler for the construction of the Metropolitan. We believe
our basis in the buildings positions us to create value over
the long term.
COLUMBIA - OPERATING & UNDER DEVELOPMENT ASSETS
($ in millions)
Asset Type
Square Feet / Units
% Occupied
As of 12/31/16
2016 NOI
Q4 2016 NOI
Annualized
Projected Annual
Stabilized NOI
Operating Assets
10-70 Columbia Corporate Center
The Metropolitan (1)
Columbia Regional Building
One Mall North
One Merriweather
Columbia Operating Properties
Subtotal
Under Development
m.flats(1)
Two Merriweather
Subtotal
Total
Office
Multi-Family
Retail/Office
Office
Office
Various
886,803
380
88,556
97,364
199,000
100,903
88.6%
92.6%
77.4%
100.0%
42.0%
90.9%
Multi-Family
Office
437
130,000
NA
NA
$
11.3
$
10.3
$
12.4
2.1
1.4
NA
NA
(0.1)
14.7
NA
NA
-
14.7
2.8
1.5
NA
NA
0.1
14.7
NA
NA
-
14.7
3.5
2.2
1.6
5.1
0.5
25.3
4.0
3.6
7.6
32.9
Town Center, The Woodlands
One Merriweather, Downtown Columbia
Notes:
1) Joint venture NOI is shown at share.
2) Stabilized NOI is shown at greater of (i) trailing 12-month actual results or (ii) stabilized NOI at time of initial underwriting. In certain situations, current annualized NOI could
exceed projected stabilized NOI as a result of non-recurring items such as lease termination fees.
Merriweather District, Downtown Columbia
40
41
HHC Annual Review 2016CEO Letter To Shareholders Future Growth
We plan to accelerate development in Downtown Columbia in 2017. We will
complete previously approved infrastructure and roadwork design required
to open the southern portion of the Merriweather District for vertical
development.
We continue to generate interest from a variety of businesses in Downtown
Columbia including healthcare, cyber security and other technological and
research-oriented companies. By developing a corporate employment center,
more people will want to live and play in Downtown Columbia. Our plans for
this urban core continue to reflect Rouse’s fifty year old vision, and they are
on their way to becoming a reality. We are proud to be honoring his legacy
in creating Downtown Columbia and reimagining the community for a new
generation of residents and office workers.
You can learn more about Downtown Columbia at
www.downtowncolumbiamd.com
Merriweather District, Downtown Columbia
OUR PLANS FOR THIS
URBAN CORE CONTINUE
TO REFLECT ROUSE’S
FIFTY-YEAR OLD VISION,
AND THEY ARE ON THEIR
WAY TO BECOMING A
REALITY.
Merriweather District, Downtown Columbia
Merriweather District, Downtown Columbia
42
43
HHC Annual Review 2016CEO Letter To Shareholders
Seaport District
When we obtained control of the South Street Seaport in 2010,
we quickly recognized the opportunity to transform the storied
site into a premier destination for New Yorkers and an anchor
for the thriving Lower Manhattan community while embracing
the waterfront and historic cultural fabric of the locale.
Today, that vision is well on its way to becoming a reality.
WORLD
TRADE
CENTER
9 SUBWAY LINES
FULTON
TRANSIT
CENTER
500K OFFICE WORKERS
6 FERRY ROUTES
& WATER TAXIS
7 MIN WALK
THE SEAPORT DISTRICT
BROOKLYN BRIDGE
Lower Manhattan
44
45
EAST RIVER
HHC Annual Review 2016CEO Letter To Shareholders SEAPORT
DISTRICT
SITE PLAN
PIER 17
170,000 SF
THE ROOFTOP
1.5 ACRE VENUE
L3/4 - CREATIVE OFFICE & EXPERIENTIAL RETAIL
Restaurants
by
GREEN
ROOM
L1 - VILLAGE DINING
TIN BUILDING
50,000+ SF
FOOD HALL
BY
JEAN-GEORGES
E
D
A
N
A
L
P
S
R E
E
V
I
T R
S
A
E
FOOD HALL BY JEAN-GEORGES
O
R
B
O
K
L
Y
N
46
B
R
I
D
G
E
180,000 SF
HISTORIC DISTRICT
47
Peck SlipWater StreetWater StreetPearl StreetBeekman StreetFulton StreetFront StreetFront StreetFront StreetSouth StreetFDR DriveTo SubwaysTitanic ParkJohn Street/Burling SlipPIER 15PIER 16PIER 17HHC Annual Review 2016CEO Letter To Shareholders
ICONIC
ROOFTOP
VENUE
That can host events for up
to 4,000 people standing or
2,600 seated
WINTER
VILLAGE
Includes an ice rink and an
event space that holds up to
500 people seated and more
than 1,800 standing
Pier 17 Rooftop - Illustrative Rendering
Pier 17 Rooftop - Illustrative Rendering
Since September 11th, 2001, the Seaport neighborhood
has become one of the fastest growing residential areas
in New York City, attracting young, affluent, well-educated
New Yorkers with average household incomes exceeding
$200,000. This is only the beginning as many new residents
will be relocating to the area with 27 residential buildings
totaling more than 4,100 units under construction or
planned for completion. An increase in visitors will also
follow with approximately 4,600 hotel rooms under
construction or planned for completion.
At the same time, Downtown NYC has become a hub
for media, creative, and technology companies with
more than 800 creative and technology companies
calling the neighborhood home, which complement the
existing strong base of financial services and insurance
businesses. Today, approximately 500,000 people work in
Lower Manhattan.
Lower Manhattan has never been easier to access with the
opening of the Fulton Transit Center in 2014 (a 5-7 minute
walk from the Seaport) and the World Trade Transportation
Hub in 2016 (a 10 minute walk from the Seaport).
Combined, these two transport links serve more than
500,000 daily commuters and provide convenient access
to the Seaport for those living throughout the metropolitan
area. With Brooklyn’s recent resurgence, Lower Manhattan
is becoming the new center of New York City.
As New York’s original commercial hub, the Seaport’s
distinct architecture and unmatched views of the Brooklyn
Bridge and East River have always made it a highly visited
tourist attraction, welcoming approximately 12-15 million
tourists annually prior to the redevelopment. However, our
focus has been to create a carefully curated destination
that will bring New Yorkers back to the district.
The current redevelopment encompasses seven buildings
spanning several city blocks along the East River
waterfront in Lower Manhattan. The development consists
of three distinct areas: the historic district, Pier 17, and the
Tin Building.
10 CORSO COMO’S
ONLY US LOCATION
48
49
Fulton Market Building
HHC Annual Review 2016CEO Letter To Shareholders In curating the district, we have
structured many of our leases to
have a significant component of
percentage rent or to give HHC
a partnership interest in the
business. As a result, our ability
to realize returns at the higher
end of our expectations will be
driven by the ultimate sales
productivity per foot that our food
and beverage and retail offerings
achieve. We could have accepted
a more traditional business
model with a focus on base rents,
however, I believe we can create
greater risk adjusted returns and
a substantially more valuable
property by creating a destination
with distinct experiences and by
participating in tenant success in
a meaningful way.
Given the Seaport’s many
possibilities and the current state
of development, it is currently
more complicated to value than
our other core assets. Our vision
is to create a destination and
property that we would want
to own for a lifetime on a site
that is irreplaceable in location,
architecture, and iconic nature
in the heart of one of the fastest
growing neighborhoods in the
world’s most vibrant city.
iPic Theaters - The Tuck Room
Pier 17, Seaport District
Food Hall by Jean-Georges, The Tin Building
We are updating our total
construction costs for the Seaport
District, now inclusive of the Tin
Building, to a gross cost of $785
million, or $731 million net of our
Superstorm Sandy insurance
proceeds of $54 million.
WE ARE TARGETING A
STABILIZED ANNUAL
RETURN BETWEEN
6% AND 8% OF OUR
NET COST ESTIMATE
OF $731 MILLION.
You can learn more about the
Seaport District at
www.southstreetseaport.com
experiential retail, including concepts from acclaimed
restauranteurs Jean-Georges Vongerichten and
David Chang (Founder of the Momofuku Group).
Floors three and four will consist of approximately
100,000 square feet of space that will likely be a
mix of creative office, experiential retail, and event
space. Pier 17 will be highlighted by a 1.5-acre rooftop
event and entertainment venue that will be home to a
restaurant, private events, a community open space,
summer concert series and a vibrant winter village
experience in a unique setting with unmatched views
of the Brooklyn Bridge, East River, and the New York
skyline. The rooftop will be able to hold approximately
4,000 people standing or 2,600 seated. Pier 17 and
the rooftop will open in the summer of 2018. Given the
unique nature of this rooftop, it is a space that needs
to be seen and experienced in order to understand its
ultimate potential.
Tin Building - The Tin Building will encompass
approximately 50,000 square feet, housing a food
market that will rival the most extraordinary food
experiences in the world. Operated by Chef Jean-
Georges Vongerichten, the market will pay homage
to the original Fulton Fish Market that opened at
the Seaport in 1822. The existing building will be
carefully deconstructed, removed from its deteriorated
platform, and rebuilt 30 feet back from FDR Drive to
restore its visibility and move it above the flood plain.
The reconstruction is expected to be complete in 2019.
T H E P O W E R
O F T H R E E
The Seaport District, NYC
Historic District - The historic district, or as we call it,
the Uplands, consists of 180,000 square feet of retail
space, which includes the 100,000 square foot Fulton
Market Building. Our first cornerstone tenant to open
in the revitalized district was iPic Theaters, which
opened in October 2016 with a 20-year lease on 46,000
square feet in the Fulton Market Building. The iPic
at the Seaport is Manhattan’s first new commercial
multiplex movie theater in over a decade and currently
iPic’s only Manhattan location.
In September, we announced that iconic retailer
10 Corso Como, founded in Milan in 1991 by style
visionary and former fashion editor Carla Sozzani, will
open in the Uplands. The store will be 10 Corso Como’s
only U.S. location. For those of you not familiar with
10 Corso Como, it is the world’s original concept store
and emulates a living magazine with its wide range
of offerings that include a restaurant, bar, art gallery,
fashion, home goods, design objects, books and more
(To learn more visit www.10corsocomo.com). 10 Corso
Como will join other previously announced tenants in
the historic district such as McNally Jackson Books,
Scotch and Soda, By Chloe, Big Gay Ice Cream, and Dita
Eyewear. We expect the Uplands to be substantially
repositioned by mid-2018.
Pier 17 - The new building will house approximately
170,000 square feet over four levels overlooking
the East River and Brooklyn Bridge. The first two
levels will house a mix of dynamic restaurants and
50
51
HHC Annual Review 2016CEO Letter To Shareholders Ward Village
We continue to make our mark in Honolulu with
substantial progress in transforming Ward Village
into one of the great urban master plans in the world.
Our 60-acre vertical MPC, located steps from the
beach on the south shore of Oahu between downtown
Honolulu and Waikiki, will become an international
benchmark for community development,
architecture, public space and culture.
Waeia Grand Penthouse, Ward Village
52
53
HHC Annual Review 2016CEO Letter To Shareholders As of December 31, 2016, we had contracted to sell
approximately $1.4 billion of residential product on towers
completed or under construction and have approximately
$541 million of product remaining for sale. We are on
schedule to deliver one tower per year through 2019 and
have executed leases to anchor the base of the towers
with leading operators including Nobu, Merrimans, CVS,
and Whole Foods Market. Similar to the MPC segment,
the scale of this development thwarts competition in
the marketplace and gives us a competitive advantage
with securing labor, financing, marketing and community
engagement.
We have made important contributions to the community
beyond our development activities. We created the Ward
Village Foundation to give back to the community and to
date have committed more than $2 million to local causes.
We have also taken a leadership role in bringing art and
culture into the neighborhood, as evidenced by our role
as founding sponsor of the 2017 Honolulu Biennial. The
hub of this inaugural biennial is located at Ward Village,
featuring works from 33 local and internationally renowned
artists, many being exhibited for the first time in Hawaii
from March 8 to May 8. Our long-term commitment to
the city goes beyond our business interests. Our local
executives are members of the community and dedicated
to strengthening Honolulu for future generations. Their
efforts have touched organizations as wide-ranging as
the YMCA of Honolulu, Make A Wish Hawaii, The Bishop
Museum and HomeAid Hawaii (founded by The Ward Village
Foundation to help serve Honolulu’s homeless population).
Central Plaza, Ward Village
The property is currently comprised of 1.3 million square feet of
retail, industrial and office space. Our master plan entitlements
allow for up to 9.3 million square feet of mixed-use development.
At full build out, we will deliver over 4,000 homes and more than
one million square feet of retail space. In 2016, Ward Village
generated $22 million of NOI from existing retail and industrial
space, a large portion of which will be redeveloped as part of
the master plan. It is unusual for a development site to generate
meaningful recurring income, particularly to continue doing so
throughout the redevelopment.
As the largest LEED-ND Platinum certified development in
the country, Ward Village is at the forefront of sustainable
community development and will contain public amenities
at a scale that no other development in Hawaii offers.
These public amenities include a planned central plaza in
the heart of the community, new tree-lined sidewalks, and
bike lanes with access to an over 100-acre public beach
park and the adjacent Kewalo Harbor, which we control
and operate under a 35-year ground lease with the Hawaii
Community Development Authority. To date, we have sold
more than 1,100 homes since we began sales in early 2014.
market continue to show strength. Last year was marked
by steady year-over-year median price increases and
limited supply of new home deliveries. Economists
forecast median condominium prices to increase by
approximately 5.5%2 over each of the coming three years.
We had a strong 2016 at Ward Village, contracting to sell
$341 million during a year in which our only new product
to hit the market was Ke Kilohana, our primarily workforce
housing tower. We contracted to sell a total of $872 million
in 2014 and 2015.
Given its unique beauty and location between the U.S.
and Asia, Oahu continues to attract a growing number of
visitors. In 2016, Honolulu welcomed approximately 8.8
million visitors, 15% above its prerecession peak in 2006.
At the same time, the employment market is robust. As
of December 2016, the Honolulu unemployment rate was
2.4%. As a result of the high barriers to entry and limited
new supply, Honolulu and the broader Oahu residential
Because we offer product at a wide range of price points
to meet demand, we have the opportunity to absorb the
majority of new customers in this market. That said,
absorption has slowed for condominium units priced
over $2 million due to the increased supply of luxury
product brought to market over the past several years.
This will likely impact the design of future towers over
the medium term.
2) University of Hawaii Economic Research Organization – State Forecast Update March 2017
Honolulu Art Biennial at the IBM Building, Ward Village - Photograph by Surface Design
54
55
HHC Annual Review 2016CEO Letter To Shareholders The New Nobu Honolulu, Ward Village
Waiea Arrival Experience, Ward Village
56
57
HHC Annual Review 2016CEO Letter To Shareholders WAIEA AND ANAHA
We broke ground on Waiea in June
2014 and opened in November 2016
at a total cost of approximately $414
million, excluding land. The tower
has an 8,200 square foot Nobu that
is projected to generate $0.5 million
in annual NOI in 2017. As of March 31,
2017, we had sold 163, or 94%, of
the units.
We broke ground on Anaha in
November 2014, which is scheduled
to begin closings in third quarter
2017 at a total cost of approximately
$401 million, excluding land. This
tower will include 16,000 square
feet of retail which is projected to
generate $1 million in annual NOI
upon stabilization in 2018. As of
March 31, 2017, we had sold 301, or
95%, of the units.
AE’O
We broke ground on the first phase
of Ae`o in March 2016 and the tower
is scheduled to begin closings in the
first half of 2019 at a total cost of
approximately $429 million, excluding
land. Additionally, the tower will have
67,000 square feet of retail, anchored
by a flagship Whole Foods Market,
which is projected to generate
$2 million in annual NOI upon
stabilization in 2019. As of March 31,
2017, we had sold 288, or 62%, of
the units.
KE KILOHANA
We broke ground on Ke Kilohana in
October 2016, which is scheduled
for completion in 2019 at a total
cost of approximately $219 million,
excluding land. The 424-unit project
contains 375 workforce units, priced
below-market, which allow for the
development of approximately 1,500
market-rate units. The tower will
include 22,000 square feet of retail
leased to CVS/Longs Drugs and is
projected to generate $1 million in
annual NOI upon stabilization in
2020. As of March 31, 2017, we had
sold 387, or 91%, of the units.
Anaha, Ward Village
58
Whole Foods Market & AEO, Ward Village
Ke Kilohana, Ward Village
Excluding the value of our land,
we anticipate achieving a 30%
gross margin on our market
rate condo developments for
the overall master plan with
front row sites obtaining higher
margins and second or third row
sites obtaining lower margins.
The market-rate housing projects allow us to subsidize the
development of workforce housing, which is exclusively
for local residents. To date, we have averaged sales per
foot of approximately $1,400 on our market-rate buildings
over a wide range of product. We have approximately five
million square feet of market rate residential development
entitlements remaining. The completed master plan will
include more than one million square feet of retail for
which we expect to achieve net rents between $50 and $75
per foot. It is worth noting that Ward is located 5-7 minutes
walking distance from Ala Moana Mall, one of the most
productive shopping destinations in the country with sales
of approximately $1,400 per foot, and as such we expect
the retail of the development to grow into a valuable
source of recurring income.
KEWALO HARBOR
The Kewalo Basin Harbor sits along Ward Village’s frontage
and forms the foreground of ocean views for thousands
of condominiums planned or in construction. The Harbor,
which leases slips for charter, commercial fishing, and
recreational vessels, is a valuable amenity to the greater
community that is unmatched on the island. In 2015
following an extensive RFP process, the Hawaii Community
Development Authority (HCDA) granted us the rights to
refurbish and reinvigorate two parcels of land that skirt
the harbor as well as manage the harbor. This will allow us
to create an integrated environment around Ward Village
that maintains the integrity and rich history of the area.
The site is approximately 55 acres and is comprised
of 144 boat slips. We plan to spend approximately $23
million in order to replace existing piers, improve security
features, upgrade access to utilities, and add 36 boat
slips for a total of 180 slips after redevelopment. In-water
construction is expected to commence in late-2017 with
expected completion in late 2019. In addition to being
an amenity for the broader community, thanks to its
depth and large slips, Kewalo is regularly home to large
superyachts making their way across the Pacific.
FUTURE DEVELOPMENT
As I mentioned last year, we continue to think about how
we can develop innovative product that will meet the
needs of the market and enable us to accelerate sales. To
that end, we are focused on bringing our next residential
tower to market this summer, which will consist of smaller,
more efficient units with lower nominal price points.
You can learn more about Ward Village at
www.Wardvillage.com
59
HHC Annual Review 2016CEO Letter To Shareholders Other Notable
Opportunities
Other assets include 110 N. Wacker in Chicago, Landmark Mall in
Alexandria, Circle T Ranch in Dallas, Elk Grove in California, and
West Windsor in New Jersey. These assets are held in our Strategic
Development segment. Even though they are not part of our core
assets, we have significantly advanced predevelopment efforts and
have taken major steps to unlock value. These steps include:
• Beginning to masterplan a large mixed-use development in
partnership with Hillwood at Circle T Ranch
• Acquiring the Macy’s site at Landmark Mall, providing us
with the ability to transform the enclosed mall and the
Macy’s parcel into a vibrant open-air, mixed-use community
with retail, residential, and entertainment components.
• Executing on a partial sale of land at our Elk Grove site to
The Wilton Rancheria tribe for $36 million in January 2017.
The tribe will construct a casino on the site which will be
linked to our future outlet/hybrid lifestyle development.
• Recently announcing plans for a future 51-story, trophy-
class office building to be developed on 110 North Wacker in
collaboration with Riverside Investment & Development.
60
110 North Wacker Drive, Chicago
61
HHC Annual Review 2016CEO Letter To Shareholders CONTENT
IS KING
Twenty-one years ago, Bill Gates wrote an article
about the importance of content and the role
it would play in the growth of the internet. The
article was titled “Content is King” and that idea
might be even more relevant today than when it
was written.
We operate in a world in which
unique content and experiences,
both in the digital and physical
worlds, command a premium.
Today, businesses that offer customers unique
content, product, or experiences are the ones
that are in the best position to thrive (think
Disney, Zara, and Netflix). Consumers are less
and less likely to shop for purely transactional
reasons; instead they seek distinct offerings. As
ecommerce and most notably Amazon continue to
grow, content will become increasingly important
in differentiating real estate destinations and
generating returns on investment.
We are constantly looking for
alternative ways to develop and
enhance our real estate by using
innovative designs and offerings.
At HHC every detail counts.
From identifying up and coming retail tenants
to experimenting with new technologies in
wall or floor coverings in the common areas of
our office and retail assets, each decision is
carefully analyzed to ensure that our products
are best positioned for long term success and
differentiation. A visit to one of our core assets is
the best way to experience our unique approach
to development.
Yayoi Kusama Exhibit at Honolulu Art Biennial, Ward Village
I often say that it takes both great assets and great people
to be successful. To accomplish the extraordinary, we
need a team of talented individuals who share a common
purpose and possess the passion associated with the
HHC DNA. Over the past six years, we have assembled the
HHC team and continue to increase its depth. In 2016, we
announced two key senior hires that further our expertise
and collective experience.
In October, we announced the hiring of David R. O’Reilly
as our Chief Financial Officer. David previously served
as Executive Vice President, Chief Investment Officer of
Parkway Properties, Inc., a Florida-based publicly traded
real estate investment trust (NYSE:PKY) which focused on
the ownership of office properties. During his career, David
has been involved in a broad range of financial advisory
and merger and acquisition activities, including leveraged
buyouts, initial public offerings and single-asset and
pooled CMBS transactions. He is well qualified to help us
assess and execute on the many opportunities that lay
ahead for HHC.
When David was hired as our CFO, he purchased a six-year
warrant to acquire common shares in the company for $1
million. There is no better way to be aligned than to truly
have “skin in the game.”
In December, we announced that Michael J. Slosser joined
us to lead our hospitality division. Michael is based in The
Woodlands, TX where the hospitality portfolio includes
The Westin, an Embassy Suites by Hilton in Hughes
Landing®, and the highly acclaimed Woodlands® Resort
& Conference Center. Michael brings a long and successful
track record in hospitality ranging from top business hotels
to iconic resorts. With his notable experience, Michael is
a critical addition to our leadership team as we continue
to strengthen our hospitality division. We look forward
to leveraging his expertise across our hotel portfolio and
integrating the highest level of customer experience in
every segment of our business.
I am particularly proud of two employee milestones that
were achieved this year. In February and March at Ward
Village, we celebrated the 49th and 50th anniversaries of
Lynn Onaka and Joyce Yoshida working for the property. We
thank them both for their tireless hard work, commitment,
and incredible loyalty. That is something to celebrate!
62
63
Lynn Onaka
Joyce Yoshida
HHC Annual Review 2016CEO Letter To Shareholders
HHC’s
Financial Flexibility
Historically, developers have often failed as a result of limited capital in
changing market conditions. We work hard every day to mitigate liquidity risk
and maintain a strong balance sheet.
In early March, we executed on an opportunistic refinancing of our existing
$750 million notes. The existing notes carried a coupon of 6.875% and became
open to a call in October of 2016. In refinancing this obligation, our goal was to
execute a transaction that would refinance the issue on a positive net present
value basis, add meaningful duration to our maturity schedule, and maintain or
improve our current liquidity profile. When we closed on our new $800 million
note issuance at 5.375%, which was a 150 basis point improvement to our
existing issue, we accomplished all of those goals.
We believe that one way to mitigate our capital markets risk is to move with
alacrity when opportunities arise and maintain access to multiple portions
of the capital markets. By actively accessing the construction loan, mortgage
loan and unsecured debt markets, we maintain strong capital availability for
our company.
Since our initial bond offering in 2013,
we have made material improvements
in our credit profile. Our total assets
have grown 78% from $3.6 billion to $6.4
billion, and our operating asset segment
has grown 136% from $1.1 billion to $2.6
billion in total assets. During this period
of growth, we have maintained discipline
in our financing strategy.
Our leverage statistics at the time of our $800 million bond offering in
March 2017 showed consolidated net debt to net book capitalization of
38%. Further, we have improved our unencumbered assets base such that
42% of our undepreciated real estate assets are unencumbered. Of our
debt outstanding, 77% is associated with our income-producing operating
asset segment. That debt represents only 56% of depreciated book value
substantially less on a market value basis. We also received an upgrade on
the ratings of our new bond issue from S&P to B+.
While we have made significant progress improving the financial profile of our
company, we still are not satisfied with our current ratings and believe that we
have and will continue to make meaningful improvements to our credit profile.
We intend to work to communicate this progress with our debt investors and
the rating agencies to receive better recognition for the company’s strong
credit profile.
Hughes Landing, The Woodlands
Track Record of
Value Creation
After emerging as an independent public company six years ago, we have delivered
substantial returns for our investors while diligently working to minimize risks. We have
completed the development of over 3.9 million square feet of commercial operating
properties since 2011, investing approximately $1.6 billion of total capital, which is
projected to generate a 9.2% yield on cost, or $144 million of NOI. Because of our low cost
basis in the land relative to the market value, we only invested approximately $354 million
of cash equity in these projects, generating a 21.9% return on equity assuming a 5.5%
cost of debt. These investments and returns are based on the book value of our land and
exclusive of condominium development as well as projects under construction such as the
Seaport District.
While the value creation over the past six years has been significant, we have only begun
to achieve our potential. We own one of the preeminent development pipelines with over
50 million square feet of vertical entitlements remaining across our portfolio, without the
need to acquire another development site or external asset. This is a material competitive
advantage over other real estate investors.
We also have a clear, short-term roadmap to unlocking shareholder value in our recent
development projects. Through the stabilization of our recently completed projects, we
can generate further cash net operating income growth of 47%, increasing our current
annualized fourth quarter NOI of $156 million to $232 million, which excludes any future
developments, acquisitions, or NOI generated from the Seaport District.
3.9M SQ FT
COMPLETED COMMERCIAL DEVELOPMENT SINCE 2011
64
65
HHC Annual Review 2016CEO Letter To Shareholders
HHC Board of Directors & Senior Leadership - Pier 17 Property Tour
Conclusion
Six years from our inception, we have made significant
progress creating value for shareholders and building
a platform to execute on large-scale, complex
developments that will enable us to further monetize
our vast development pipeline. As I look to the balance
of 2017 and beyond, I remain confident in our company’s
position as we work to accelerate value creation and
continue transforming our assets into a self-sustaining
revenue generating portfolio. As Frank Sinatra sang
most elegantly “[our] best is yet to come.”
Warm regards,
David R. Weinreb
Chief Executive Officer
67
10 Corso Como - Milan
Coming Soon to the Seaport District
66
HHC Annual Review 2016CEO Letter To Shareholders
BY THE
NUMBERS
67%
GROWTH
IN YEAR
OVER YEAR
SALES
AT BRIDGELAND
SOLD 80 SOUTH STREET IN NEW YORK FOR
$390M
$141M
FOR A PROFIT OF
OVER 15 MONTHS
OBTAINED
TIF TO SUPPORT INFRASTRUCTURE FOR
$90M
5M SF
OF DEVELOPMENT AT DOWNTOWN COLUMBIA
CASH ON HAND OVER
SQ FT COMPLETED COMMERCIAL DEVELOPMENT SINCE 2011
$665M
3.9M
$1.6BN
9.2%
INVESTED APPROXIMATELY
SINCE 2011 WHICH IS PROJECTED TO GENERATE A
YIELD ON COST
STABILIZED NOI TARGET
$232M
373%
INCREASE FROM 2010
$1.4BN
CUMULATIVE SALES AT
WARD VILLAGE SINCE
PRE-SALES BEGAN IN 2014
$226M
CONTRACTED SALES AT
THE SUMMIT AS OF YEAR
END 2016
68
69
HHC Annual Review 2016HHC By The Numbers TOGETHER
WE MAKE
EXTRAORDINARY
The People and Partnerships
Helping Us Create Extraordinary Experiences
From Wall Street to Waikiki.
"iPic is a natural fit for New
York and New Yorkers, and
we are excited to enhance
the redevelopment of such
an iconic destination as the
South Street Seaport."
HAMID HASHEMI
President and CEO,
iPic Entertainment
Seaport
District
NYC
"I'M SO EXCITED
TO BE PART OF THE
REVITALIZATION OF
THE STORIED SEAPORT
DISTRICT THAT IS
BECOMING A HUB FOR
CUTTING-EDGE FOOD
CONCEPTS IN LOWER
MANHATTAN."
DAVID CHANG
Chef and Founder,
Momofuku
"As someone who looked forward to
sourcing fish daily at the Fulton Fish
Market at the Seaport and has watched
the area lose its relevance over the
last decade,
I AM HONORED
TO BE A PART OF
THIS CATALYTIC
TRANSFORMATION.
It is a privilege to be a part of the
revitalization of this beloved, culturally
rich and historic neighborhood alongside
The Howard Hughes Corporation."
JEAN-GEORGES VONGERICHTEN
Chef and Restaurateur
72
73
HHC Annual Review 2016Together We Make Extraordinary
Seaport
District
NYC
“AS A EUROPEAN, I AM VERY EXCITED
TO SEE 10 CORSO COMO COME TO
THE PLACE WHERE NEW YORK CITY
WAS BORN. THE SEAPORT DISTRICT’S
HISTORY OF INTERNATIONAL COMMERCE
AND INNOVATION IS INSPIRING. I AM
LOOKING FORWARD TO CREATING AN
EXTRAORDINARY DESTINATION IN SUCH
A UNIQUE NEIGHBORHOOD WHERE THE
INTERESTS OF THE COMMUNITY ARE
A FOCUS FOR GROWTH,”
Carla Sozzani,
Founder of 10 Corso Como
“SOUTH STREET IS ON ITS WAY TO
BECOMING DOWNTOWN’S HOTTEST
TICKET AROUND.”
Steve Cuozzo, New York Post
74
75
HHC Annual Review 2016Together We Make Extraordinary 110
North
Wacker
Drive
“IN MY ONGOING CONVERSATIONS WITH THE HOWARD
HUGHES CORPORATION, IT IS EVIDENT THEIR TEAM
UNDERSTANDS THE POSITIVE IMPACT THIS HIGH-PROFILE
PROJECT WILL HAVE ON RESIDENTS, BUSINESSES AND
THE OVERALL AESTHETIC APPEAL IN THE CENTRAL
BUSINESS DISTRICT,”
BRENDAN REILLY – 42ND WARD ALDERMAN
" I can't tell you how
happy we are to be a
part of the Columbia
community and how
excited we are to have
opened a store here."
SCOTT ALLSHOUSE
Mid-Atlantic
Region President,
Whole Foods Market
“THIS PROJECT WILL ADD TO CHICAGO’S
SKYLINE WHILE CONTINUING TO BUILD
ON OUR THRIVING RIVERFRONT,”
MAYOR RAHM EMANUEL
76
77
HHC Annual Review 2016Together We Make Extraordinary
"WE ARE DELIGHTED TO INTRODUCE
THE WESTIN AT THE WOODLANDS TO OUR
GLOBAL GUESTS AND LOCAL RESIDENTS,
ENSURING THAT THEY ALL LEAVE FEELING
BETTER THAN WHEN THEY ARRIVED."
BOB JACOBS
Vice President of Brand Management, North America,
Westin Hotels & Resorts
“THIS DEVELOPMENT SYMBOLIZES THE
ATTRACTIVENESS OF OUR CITY TO INVESTORS
AND NATIONAL BRANDS WHILE UNDERSCORING
THE GROWTH OF OUR ECONOMY THROUGH
INCREASED SALES TAX REVENUE AND NEW JOBS
AND OPPORTUNITIES FOR THE PEOPLE OF NEW
ORLEANS. RIVERWALK HAS ANCHORED THIS
IMPORTANT CORRIDOR, AND WE WILL CONTINUE
A PLACE-BASED STRATEGY THAT TURBO CHARGES
THE RIVERFRONT.”
New Orleans Mayor Mitch Landrieu.
"This beautiful new hotel is
a fantastic addition to the
vibrant Hughes Landing
development. This hotel
will also help meet the
growing demand for upscale,
full-service hotels in The
Woodlands – which has
experienced tremendous
growth in recent years."
BILL DUNCAN
Global Head,
Embassy Suites by Hilton
78
79
HHC Annual Review 2016Together We Make Extraordinary
Downtown
Summerlin
NV
Summerlin
NV
“DOWNTOWN SUMMERLIN IS A UNIQUE DESTINATION AND
ONE IN WHICH I WAS PROUD TO BASE MY BUSINESSES,
INCLUDING THE CITY’S FIRST MAJOR PROFESSIONAL SPORTS
TEAM. I ALSO CHOSE SUMMERLIN AS A PLACE TO LIVE
BECAUSE IT HAS THE PERFECT BLEND OF NATURAL BEAUTY
AND MODERN AMENITIES.”
BILL FOLEY, CHAIRMAN AND CEO,
VEGAS GOLDEN KNIGHTS.
"THE HOWARD HUGHES
CORPORATION HAS
MADE A DESTINATION
LIKE NO OTHER IN
THE COUNTRY. WITH
ITS GRAND OPENING
THIS MONTH, ALL
ROADS IN NEVADA
LEAD TO DOWNTOWN
SUMMERLIN. "
BRIAN SANDOVAL
GOVERNOR OF NEVADA
80
81
Downtown Summerlin Grand Opening - October 9, 2014
HHC Annual Review 2016Together We Make Extraordinary
Ward
Village
HI
"WARD VILLAGE IS CREATING
A NEW COMMUNITY IN THE
HEART OF HONOLULU THAT
IS UNLIKE ANYTHING THAT
EXISTS IN HAWAI'I."
The combination of world class architecture, a walkable
neighborhood and an authentic district of high quality shops,
restaurants and entertainment offerings makes Ward Village a
unique destination and the place to be in Honolulu.
NOBU MATSUHISA
Chef and Restaurateur
"The design for Ae‘o is
indicative of Ward Village
and its bold vision of the
future. We are delighted to
enhance these perceptions
of place through the
architecture to set the
stage for an active, healthy
and engaged lifestyle."
PETER BOHLIN
Founding Design Principal,
Bohlin Cywinski Jackson
82
83
HHC Annual Review 2016Together We Make Extraordinary
"WHAT IS OUTSTANDING IN MY
MIND ABOUT THE HOWARD HUGHES
CORPORATION IS JUST HOW MUCH
TIME THEY REALLY TOOK TO GET TO
KNOW US. I FEEL THAT THEY HAVE
TRULY GONE OUT OF THEIR WAY TO
ENSURE THAT ACCOMMODATIONS
WERE NOT ONLY MADE BUT THAT
TRUE RESPECT HAS BEEN GIVEN TO
OUR PEOPLE AND OUR PLACE IN
THIS LAND."
HINA WONG-KALU
HAWAIIAN COMMUNITY LEADER
84
85
HHC Annual Review 2016Together We Make Extraordinary
"We believe in the power that art has
to bring communities and cultures
together. We are incredibly excited to
have launched this year the very first
Honolulu Biennial with our founding,
title sponsor, the Howard Hughes
Corporation. This festival is game-
changer for our hometown, featuring 33
dynamic contemporary artists spread
across our city and in Ward Village."
ISABELLA ELLAHEH HUGHES & KATHERINE TUIDER,
DIRECTORS AND CO-FOUNDERS,
HONOLULU BIENNIAL FOUNDATION
86
87
HHC Annual Review 2016Together We Make Extraordinary
"At Ward Village, Howard
Hughes has set out to build
not just a set of residential
buildings, but a collection of
major works of architecture
by some of the world’s great
architects. It represents
a level of architectural
ambition that is new to
Honolulu, and over the next
generation will make the
city a center of world class
architecture."
PAUL GOLDBERGER
Architectural Consultant
and Critic
"Ward Village represents the most
luxurious tower residences on the
market in Hawaii. It is international
class. Along with New York, Paris,
London & Tokyo, it is designed
and built to the level of these places."
TONY INGRAO
President and Principal, Ingrao Inc.
88
89
HHC Annual Review 2016Together We Make Extraordinary
2015
"This is the company that I am most proud of
because it didn’t exist before, and I get real
satisfaction from building something from scratch
that creates meaningful long term value... It is an
investment that we intend to hold forever. This is
a company with the current team that has
unlimited possibilities."
BILL ACKMAN
Founder, Pershing Square Capital Management
Chairman, The Howard Hughes Corporation
90
91
HHC Annual Review 2016Together We Make Extraordinary CORPORATE OFFICERS
DAVID R. WEINREB, CHIEF EXECUTIVE OFFICER
David R. Weinreb is the Chief Executive Officer and a Member of the Board of Directors of The Howard Hughes Corporation. Known for his
passion, tenacity and entrepreneurial spirit, Mr. Weinreb has directed the company's efforts since its emergence in 2010, building a portfolio of
some of the most sought-after real estate in the country. His vision, leadership and acumen led him to be honored as the 2013 Ernst and Young
Entrepreneur Of The Year® Award in Real Estate for the region. In 2012, he was named as one of the Top 200 CEOs in the U.S. by ExecRank
and in 2015 he was listed in the 2015 Commercial Observer Power 100 as one of 100 most powerful people in New York City real estate.
A real estate industry veteran for over 30 years, Mr. Weinreb spent 17 years as Chairman and CEO of TPMC Realty Corporation, a company
he built into a multi-faceted investment firm prior to joining The Howard Hughes Corporation. Located in Dallas, Texas, TPMC, whose tenant
roster included many Fortune 500 companies, specialized in the acquisition and repositioning of underperforming real estate and real estate
related assets across the United States. In addition to development, ownership and management of real estate, the firm's activities included
mezzanine financing and private equity investing.
Mr. Weinreb attended New York University and began his real estate career in the late 1980s in New York City. He is a member of the International
Council of Shopping Centers and the Urban Land Institute. He also serves on the Advisory Council of the Lusk Center for Real Estate at the
University of Southern California. His philanthropic interests are both local and national.
GRANT HERLITZ, PRESIDENT
Mr. Herlitz oversees the daily operation and works closely with the CEO in driving strategy for the company. Previously, Mr. Herlitz was
President and Chief Financial Officer of TPMC Realty Corporation. He joined TPMC in 2000 as Vice President of Investments using his
varied financial and management experience to position himself for multiple roles within the company.
DAVID O’REILLY, CHIEF FINANCIAL OFFICER
David O’Reilly joined The Howard Hughes Corporation in October 2016 as the Chief Financial Officer. He is responsible for managing the
company’s investment and financial strategy, working with the executive team to unlock meaningful long-term value across the company’s
portfolio. Prior to joining The Howard Hughes Corporation, Mr. O’Reilly served as Executive Vice President, Chief Investment Officer of
Parkway Properties, Inc. - a New York Stock Exchange-traded real estate investment trust focused on office properties.
PETER F. RILEY, GENERAL COUNSEL
M r. R i ley ha s over 30 yea r s of ex per ience, work i ng i n bot h t he publ ic a nd pr ivat e sec tor. P r ior to joi n i ng t he compa ny,
and since 2004, Mr. Riley was a partner at K&L Gates LLP with a significant focus on tax aspects of fund formation, joint ventures and the
acquisition, disposition, operation and financing of real estate assets. Previously, Mr. Riley led the tax department at Kelly, Hart & Hallman,
and was Senior Tax Counsel at Simpson Thacher & Bartlett.
BOARD OF DIRECTORS
WILLIAM ACKMAN, CHAIRMAN OF THE BOARD
William Ackman is the CEO and Portfolio Manager of Pershing Square Capital Management, L.P., an SEC registered investment adviser
founded in 2003. Pershing Square is a concentrated research-intensive fundamental value investor in long and occasionally short investments
in the public markets.
Prior to forming Pershing Square, Mr. Ackman co-founded Gotham Partners Management Co., LLC, an investment adviser that managed
public and private equity hedge fund portfolios. Prior to Gotham Partners, Mr. Ackman began his career in real estate investment banking at
Ackman Brothers & Singer, Inc. Mr. Ackman received an MBA from the Harvard Business School and a Bachelor of Arts magna cum laude
from Harvard College.
Mr. Ackman is the Chairman of the board of The Howard Hughes Corporation (NYSE: HHC). He is a Trustee of the Pershing Square Foundation,
a member of the Board of Trustees at The Rockefeller University and the Board of Dean’s Advisors of the Harvard Business School.
ADAM FLATTO
Adam Flatto is the President and Chief Executive Officer of the Georgetown Company, a privately-held real estate investment and development
company based in New York City. He has been with The Georgetown Company since 1990, and since that time has been involved with the
development, acquisition and ownership of over 20 million square feet of commercial real estate projects throughout the United States.
Mr. Flatto is a trustee and board member of several civic and cultural institutions. He is Co-Chairman of the Park Avenue Armory and Co-
Chairman of the Robin Hood Housing Advisory Board. He is also a trustee of the Enterprise Foundation and the Wexner Center for the Arts.
Mr. Flatto graduated magna cum laude from Brown University and received his MBA from the Wharton School.
JEFFREY FURBER
Jeffrey Furber is the Chief Executive Officer of AEW Capital Management, L.P. (“AEW”) and Chairman of AEW Europe. AEW provides
real estate investment management services to investors worldwide. AEW and its affiliates manage over $60 billion of real estate assets and
securities on behalf of many of the world’s leading institutional and private investors.
ALLEN MODEL
Allen Model is the Co-Founder of Overseas Strategic Consulting, Ltd. (“OSC”), and has been Treasurer and Managing Director since 1992.
OSC is an international consulting firm that provides public information services to a number of clients worldwide, including the United
States Agency for International Development, The World Bank, The Asian Development Bank and host governments. He has had extensive
real estate development experience as a lawyer in the field, investor, and advisor to real estate development firms.
SCOT SELLERS
Scot Sellers served as Chief Executive Officer of Archstone, one of the world’s largest apartment companies, from January 1997 until his
retirement in February 2013. Prior to that, he was Archstone’s Chief Investment Officer from 1995 to 1997. Under his leadership, Archstone
moved from being a mid-sized owner of apartments in secondary and tertiary cities to becoming the largest publicly traded owner of urban
high-rise apartments in the nation’s premier cities. During his 36-year career in the apartment business, Mr. Sellers has been responsible for
the development, acquisition and operation of over $40 billion of apartment communities in over 50 different cities across the United States.
Mr. Sellers served as the Chairman of the National Association of Real Estate Investment Trusts from November 2005 to November 2006.
STEVEN SHEPSMAN
Steven Shepsman is an Executive Managing Director and Founder of New World Realty Advisors, a real estate investment and
advisory firm specializing in real estate restructurings, development and finance. Earlier in his career, Mr. Shepsman, a CPA,
was a Managing Partner of Kenneth Leventhal and Company and of Ernst & Young’s Real Estate Practice.
BURTON M. TANSKY
Burton M. Tansky is a luxury retail veteran who served as Non-Executive Chairman of the Board of Directors of the Neiman Marcus
Group, Inc. from 2010 to 2013. He was the Chief Executive Officer of Neiman Marcus Group from 2004 to 2010, Chief Executive
Officer of Neiman Marcus Stores from 1994 to 2007 and Chief Executive Officer of Bergdorf Goodman from 1990 to 1994. Prior to
that, he was the President of Saks Fifth Avenue from 1980 to 1990. Mr. Tansky’s philanthropic interests are both local and national.
MARY ANN TIGHE
Mary Ann Tighe has been credited with transforming New York’s skyline during her more than 32 years in the real estate industry.
She has been responsible for over 98 million square feet of commercial transactions, and her deals have anchored more than 14.4
million square feet of new construction in the New York region. Ms. Tighe has been CEO of CBRE’s New York Tri-State region since
2002, a region of approximately 2,500 employees. In January 2010, Ms. Tighe was named Chairman of the Real Estate Board of New
York, the first woman to hold this position in REBNY’s 114-year history and the first broker in 30 years.
DAVID R. WEINREB
See corporate officers.
SUPPLEMENTAL INFORMATION
Supplemental Information
(in thousands)
Retail
The Woodlands
Creekside Village Green
Hughes Landing Retail
1701 Lake Robbins
20/25 Waterway Avenue
Waterway Garage Retail
Columbia
Columbia Regional
Summerlin
Downtown Summerlin
Ward Village
Ward Village Retail
Other
Cottonwood Square
Lakeland Village Center at Bridgeland
Outlet Collection at Riverwalk
Total Retail NOI
Office
The Woodlands
One Hughes Landing
Two Hughes Landing
Three Hughes Landing
1725 Hughes Landing Boulevard
1735 Hughes Landing Boulevard
2201 Lake Woodlands Drive
9303 New Trails
3831 Technology Forest Drive
3 Waterway Square
4 Waterway Square
1400 Woodloch Forest
Columbia
10-70 Columbia Corporate Center
Columbia Office Properties
One Mall North
Summerlin
ONE Summerlin
Other
110 N. Wacker
Total Office NOI
Multi-family
The Woodlands
Millennium Six Pines Apartments
Millennium Waterway Apartments
One Lakes Edge
South Street Seaport
85 South Street
Total Multi-family NOI
Hospitality
The Woodlands
Embassy Suites at Hughes Landing
The Westin at The Woodlands
The Woodlands Resort & Conference Center
Total Hospitality NOI
Total Retail, Office, Multi-family, and Hospitality NOI
Other
The Woodlands
The Woodlands Ground leases
The Woodlands Parking Garages
2000 Woodlands Parkway
Other
Other Properties
Total Other
Operating Assets NOI excluding properties sold or in redevelopment
Redevelopments
South Street Seaport
South Street Seaport
Other
Landmark Mall
Total Operating Asset Redevelopments NOI
Dispositions
The Woodlands
The Club at Carlton Woods
Other
Park West
Rio West Mall
Total Operating Asset Dispositions NOI
Total Operating Assets NOI - Consolidated
Straight-line lease amortization
Early extinguishment of debt
Demolition costs
Development-related marketing costs
Provision for impairment
Depreciation and Amortization
Write-off of lease intangibles and other
Other income, net
Equity in earnings from Real Estate Affiliates
Interest, net
Less partners' share of Operating Assets EBT
Total Operating Assets EBT
Company's Share of Equity Method Investments NOI
The Woodlands
Forest View / Timbermill Apartments
Millennium Six Pines Apartments
Millennium Waterway Apartments
Stewart Title of Montgomery County, TX
Woodlands Sarofim # 1
Columbia
The Metropolitan Downtown Columbia
Summerlin
Constellation
Las Vegas 51s
South Street Seaport
33 Peck Slip
Company's share NOI - equity investees
Plus: Joint Venture Partner's Share of NOI
Total NOI - equity investees
Adjustments to NOI
Equity Method Investments EBT
Less: Joint Venture Partner's Share of EBT
Equity in earnings from Real Estate and Other Affiliates
Distributions from Summerlin Hospital Investment - Cost basis investment
Segment equity in earnings from Real Estate and Other Affiliates
For the three months ended
December 31,
2016
2015
2016
2015
For the year ended December 31,
2014
2013
2012
2011
2010
$
380
1,057
90
483
163
363
4,371
5,009
175
134
1,469
13,694
1,552
2,054
(105)
450
1,901
(14)
384
453
1,797
1,680
414
2,574
29
75
836
$
285
682
103
499
150
342
3,417
6,181
183
-
1,606
13,448
1,151
1,110
-
(208)
(34)
(26)
438
541
1,618
1,304
373
2,927
107
-
111
1,529
15,609
1,523
10,935
985
856
1,000
132
2,973
1,065
1,154
1,928
4,147
36,423
371
(128)
(46)
-
946
1,143
37,566
92
(150)
(58)
-
489
-
489
37,997
1,057
-
(629)
(2,072)
-
(21,767)
(60)
1,475
185
(10,425)
-
5,761
$
-
-
-
283
94
689
(54)
(280)
156
888
$
1,307
2,195
(1,487)
708
(523)
185
-
1,018
835
135
1,988
(25)
-
2,042
2,017
28,388
335
(53)
-
1,030
1,312
29,700
(2,268)
(45)
(2,313)
-
427
-
427
27,814
4,759
-
(264)
(2,366)
-
(24,490)
(78)
524
550
(9,019)
-
(2,570)
$
-
741
-
339
61
455
-
(238)
-
1,358
$
969
2,327
(809)
1,518
(968)
550
1,549
3,402
364
1,765
643
1,387
16,632
22,048
705
190
5,125
53,810
6,014
5,033
(514)
120
2,857
(127)
1,641
1,968
6,735
6,466
1,708
-
11,275
(104)
75
-
2,365
-
6,105
51,617
1,498
3,183
3,623
523
8,827
3,563
1,739
7,591
12,893
127,147
1,417
(448)
(51)
3,871
4,789
131,936
(532)
-
(676)
(1,208)
-
1,835
-
1,835
132,563
10,689
-
(1,123)
(7,110)
(35,734)
(86,313)
(60)
4,601
2,802
(39,447)
-
(19,132)
-
1,252
-
989
308
-
2,069
-
(54)
34
-
471
5,069
5,430
10,499
(9,527)
972
(786)
186
$
$
$
$
824
1,468
399
1,883
690
1,342
10,117
25,566
677
-
6,450
49,416
5,262
4,489
-
(208)
(34)
(144)
1,898
1,956
6,288
5,766
1,621
12,375
450
-
(206)
6,100
45,613
-
4,169
982
494
5,645
(25)
-
10,560
10,535
111,209
1,190
(508)
-
3,857
4,539
115,748
(2,692)
(347)
(3,039)
(942)
1,812
-
870
113,579
7,391
-
(2,675)
(9,747)
-
(89,075)
(671)
524
1,883
(31,111)
-
(9,902)
-
1,151
-
1,004
299
597
-
153
$
$
$
-
-
185
1,505
809
268
810
24,255
647
-
528
29,007
4,443
157
-
-
-
141
1,860
(1)
6,181
5,756
1,191
2,351
496
-
-
$
-
-
-
1,640
370
-
-
24,144
451
-
(763)
25,842
(139)
-
-
-
-
(167)
1,679
-
2,059
5,886
1,160
757
1,151
-
-
$
-
-
-
1,582
97
-
-
22,045
432
-
221
24,377
-
-
-
-
-
53
1,819
-
-
5,544
1,995
140
2,304
-
-
-
-
-
1,310
7
-
-
21,481
380
-
418
23,596
-
-
-
-
-
332
742
-
-
1,639
649
-
2,649
-
-
6,077
28,652
6,023
18,409
6,073
17,928
6,115
12,126
-
4,386
-
(188)
4,198
-
-
6,092
6,092
67,949
458
(598)
-
2,116
1,976
69,925
(593)
953
360
(4,410)
2,058
77
(2,275)
68,010
1,064
-
(6,712)
(9,770)
-
(49,272)
(2,216)
-
2,025
(16,930)
-
(13,801)
-
(68)
-
1,330
303
-
-
(77)
$
-
4,457
-
-
4,457
-
-
10,167
10,167
58,875
444
(749)
-
(41)
(346)
58,529
(8,980)
491
(8,489)
(5,241)
1,608
790
(2,843)
47,197
1,759
-
(2,078)
-
-
(31,427)
(2,884)
-
3,893
(19,011)
-
(2,551)
-
-
-
1,257
283
-
-
(7)
$
-
2,589
-
-
2,589
-
-
10,670
10,670
55,564
404
(1,128)
-
1,703
979
56,543
639
923
1,562
(4,242)
830
1,250
(2,162)
55,943
(736)
-
-
-
-
(23,318)
-
-
3,683
(16,104)
-
19,468
244
-
1,477
938
124
-
-
-
$
-
-
-
-
-
-
-
7,726
7,726
43,448
403
(1,204)
-
1,530
729
44,177
5,650
737
6,387
(5,126)
576
1,319
(3,231)
47,333
918
(11,305)
-
-
-
(20,309)
-
-
3,926
(12,775)
425
8,213
913
-
2,148
535
298
-
-
-
$
-
3,204
$
-
1,488
$
-
1,533
$
-
2,783
$
-
3,894
$
3,212
6,416
(3,069)
3,347
(3,211)
136
2,450
3,938
(1,112)
2,826
(2,450)
376
2,311
3,844
(77)
3,767
(2,377)
1,390
1,969
4,752
(1,476)
3,276
(1,969)
1,307
3,061
6,955
(3,862)
3,093
(3,061)
32
-
185
$
-
550
$
2,616
2,802
$
1,747
1,883
$
1,649
2,025
$
2,503
3,893
$
2,376
3,683
$
3,894
3,926
$
-
-
-
674
-
-
-
22,980
484
-
579
24,717
-
-
-
-
-
322
706
-
-
15
1,036
-
2,657
-
-
6,628
11,364
-
-
-
-
-
-
-
4,379
4,379
40,460
337
(1,049)
-
3,042
2,330
42,790
4,238
1,619
5,857
(3,885)
366
1,897
(1,622)
47,025
183
-
-
-
(80,924)
(23,461)
-
-
(338)
(17,183)
2,157
(72,541)
805
-
(131)
611
314
-
-
-
-
1,599
2,648
4,247
(1,937)
2,310
(2,648)
(338)
-
(338)
$
$
$
$
Honolulu Art Biennial, Ward Village