Company: HPP
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0001482512-25-000150
Chunk: 25

Company: Hudson Pacific Properties, Inc.
Filing Date: 2025-11-06
Form: 10-Q
Item: Part I, Item 2
Chunk 25
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 does not qualify for hedge accounting.

Fee income

We recognized fee income of $3.9 million for the nine months ended September 30, 2025 compared to $3.9 million for the nine months ended September 30, 2024. Fee income represents the management fee income earned from our unconsolidated real estate entities. 

Interest expense

The following table presents a reconciliation from gross interest expense to the interest expense line item on the Consolidated Statements of Operations:Nine Months Ended September 30,20252024Dollar ChangePercent ChangeGross interest expense(1)$151,007 $157,272 $(6,265)(4.0)%Capitalized interest(29,941)(29,915)(26)0.1 Non-cash interest expense(2)12,302 5,896 6,406 108.6 TOTAL$133,368 $133,253 $115 0.1 %

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1.Includes interest on the Company’s debt and hedging activities.

2.Includes the amortization of deferred financing costs and fair market value adjustments for our mark-to-market interest rate derivatives.

Gross interest expense decreased by $6.3 million, or 4.0%, to $151.0 million for the nine months ended September 30, 2025 compared to $157.3 million for the nine months ended September 30, 2024. The decrease was primarily related to lower outstanding borrowings on the unsecured line of credit, the 2025 repayments of the Element LA loan and Series B, C and D notes and as lower reference rates on our floating rate debt. The decrease was partially offset by the interest expense related to the Office Portfolio CMBS loan, which was obtained in March 2025. 

Capitalized interest increased by $26 thousand, or 0.1%, to $29.9 million for the nine months ended September 30, 2025 compared to $29.9 million for the nine months ended September 30, 2024. The increase was primarily driven by development activity at our Washington 1000, Sunset Las Palmas Studios, Sunset Waltham Cross Studios and Sunset Pier 94 Studios properties, offset by the completion of our Sunset Glenoaks Studios development in 2024

Non-cash interest expense increased by $6.4 million, or 108.6%, to $12.3 million for the nine months ended September