Hudson Pacific Properties and Blackstone Announce Completion of Joint Venture to Expand Studio Platform
August 03 2020 - 9:00AM
Business Wire
Hudson Pacific Properties, Inc. (“Hudson Pacific”) (NYSE: HPP)
and Blackstone (NYSE: BX) today announced that funds affiliated
with Blackstone Property Partners have completed their previously
announced acquisition of a 49% interest in Hudson Pacific’s
Hollywood Media Portfolio. The portfolio comprises three Hollywood
studios and five on-lot or adjacent Class A office properties,
totaling 2.2 million square feet, at a gross portfolio valuation of
$1.65 billion. Hudson Pacific retained a 51% ownership stake and
remains responsible for day-to-day operations, leasing and
development.
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The transaction includes Sunset Bronson, Sunset Gower and Sunset
Las Palmas Studios, which collectively comprise 35 stages or 1.2
million square feet of production and support space in Hollywood.
The studio lots are critical infrastructure for TV, film and
digital production and house content production tenants from both
traditional and streaming media companies. The portfolio also
includes 966,000 square feet of highly sought-after Class A office
properties that Hudson Pacific has developed on and adjacent to the
lots. Netflix is the portfolio’s largest tenant, leasing over
700,000 square feet, in addition to signing long-term leases for
stages and production space.
Opportunities to further expand the joint venture’s portfolio
include approximately 1.1 million square feet of untapped
development rights at Sunset Gower and Sunset Las Palmas, as well
as the pursuit of additional studio acquisitions in Los Angeles and
other markets. The transaction was announced on June 29, 2020.
In conjunction with closing the transaction, the joint venture
closed a $900.0 million mortgage loan secured by the portfolio.
This loan has an initial interest rate, subject to final bond
pricing, of LIBOR plus 2.15% per annum and is interest only through
the two-year term with three one-year extension options.
Hudson Pacific’s combined proceeds from the sale of the 49%
portfolio interest and its share of asset-level financing will be
approximately $1.27 billion before closing credits, prorations and
costs. Hudson Pacific expects to use approximately $780.0 million
to repay all outstanding amounts under its revolving credit
facilities and Term Loans B and D, which are due second and fourth
quarter 2022, respectively. The remainder will be available to
Hudson Pacific for potential future investments and/or share
repurchases, and general corporate purposes.
Eastdil Secured acted as Hudson Pacific’s lead financial
advisor, while BofA Securities also acted as a financial advisor.
Gibson, Dunn & Crutcher LLP and Latham & Watkins LLP acted
as Hudson Pacific’s legal counsel. Simpson Thacher & Bartlett
LLP acted as Blackstone’s legal counsel, and Goldman Sachs &
Co. LLC and Barclays served as Blackstone’s financial advisors.
About Hudson Pacific Properties
Hudson Pacific is a real estate investment trust with a
portfolio of office and studio properties totaling nearly 19
million square feet, including land for development. Focused on
premier West Coast epicenters of innovation, media and technology,
its anchor tenants include Fortune 500 and leading growth companies
such as Netflix, Google, Square, Uber, NFL Enterprises and more.
Hudson Pacific is publicly traded on the NYSE under the symbol HPP
and listed as a component of the S&P MidCap 400 Index. For more
information visit HudsonPacificProperties.com.
About Blackstone Real Estate
Blackstone is a global leader in real estate investing.
Blackstone’s real estate business was founded in 1991 and has $167
billion of investor capital under management. Blackstone is one of
the largest property owners in the world, owning and operating
assets across every major geography and sector, including
logistics, multifamily and single-family housing, office,
hospitality and retail. Our opportunistic funds seek to acquire
undermanaged, well-located assets across the world. Blackstone’s
Core+ strategy invests in substantially stabilized real estate
globally through regional open-ended funds focused on high-quality
assets, and Blackstone Real Estate Income Trust, Inc. (BREIT), a
non-listed REIT that invests in U.S. income-generating assets.
Blackstone Real Estate also operates one of the leading global real
estate debt businesses, providing comprehensive financing solutions
across the capital structure and risk spectrum, including
management of Blackstone Mortgage Trust (NYSE: BXMT).
Forward-Looking Statements Regarding Hudson Pacific
Properties
This press release may contain forward-looking statements within
the meaning of the federal securities laws. Forward-looking
statements relate to expectations, beliefs, projections, future
plans and strategies, anticipated events or trends and similar
expressions concerning matters that are not historical facts. In
some cases, you can identify forward-looking statements by the use
of forward-looking terminology such as “may,” “will,” “should,”
“expects,” “intends,” “plans,” “anticipates,” “believes,”
“estimates,” “predicts,” or “potential” or the negative of these
words and phrases or similar words or phrases that are predictions
of or indicate future events or trends and that do not relate
solely to historical matters. Forward-looking statements involve
known and unknown risks, uncertainties, assumptions and
contingencies, many of which are beyond Hudson Pacific’s control,
which may cause actual results to differ significantly from those
expressed in any forward-looking statement. All forward-looking
statements reflect Hudson Pacific’s good faith beliefs, assumptions
and expectations, but they are not guarantees of future
performance. Furthermore, Hudson Pacific disclaims any obligation
to publicly update or revise any forward-looking statement to
reflect changes in underlying assumptions or factors, of new
information, data or methods, future events or other changes. For a
further discussion of these and other factors that could cause
Hudson Pacific’s future results to differ materially from any
forward-looking statements, see the section entitled “Risk Factors”
in Hudson Pacific’s Annual Report on Form 10-K filed with the
Securities and Exchange Commission, or SEC, and other risks
described in documents subsequently filed by Hudson Pacific from
time to time with the SEC.
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Hudson Pacific Properties Laura
Campbell (310) 622-1702 lcampbell@hudsonppi.com
Blackstone Jennifer Friedman (212)
583-5122 Jennifer.Friedman@blackstone.com
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