UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ______________________________________ FORM 10-Q ______________________________________ ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2019 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______ to ______ Commission File Number: 001-34789 (Hudson Pacific Properties, Inc.) Commiss ...

Financial Performance - Total revenues for Q1 2019 were $197,389,000, an increase of 13.3% compared to $174,118,000 in Q1 2018[25] - Net loss attributable to common stockholders for Q1 2019 was $(39,392,000), compared to net income of $48,577,000 in Q1 2018[25] - Basic and diluted net loss per share for Q1 2019 was $(0.26), down from earnings of $0.31 per share in Q1 2018[25] - Comprehensive loss attributable to common stockholders for Q1 2019 was $(47,219,000), compared to comprehensive income of $57,992,000 in Q1 2018[27] - For the three months ended March 31, 2019, Hudson Pacific Properties reported a net loss of $36,895,000 compared to a net income of $52,563,000 for the same period in 2018, representing a significant decline[40] - The company reported an impairment loss of $52,201,000 in Q1 2019[25] - Cash flows from operating activities increased to $89,446,000 in Q1 2019, up from $64,447,000 in Q1 2018, indicating improved operational cash generation[34] - The company reported depreciation and amortization expenses of $68.5 million for Q1 2019, up from $60.6 million in Q1 2018, indicating a 13.5% increase[50] - The company recognized an unrealized loss of $5,926,000 in other comprehensive income due to changes in the fair value of derivatives for the three months ended March 31, 2019[178] Assets and Liabilities - Total assets increased to $7,373,628,000 as of March 31, 2019, compared to $7,070,879,000 at December 31, 2018[22] - Total liabilities rose to $3,508,953,000 as of March 31, 2019, up from $3,117,793,000 at December 31, 2018[22] - The company's investment in real estate decreased to $6,990,420,000 as of March 31, 2019, down from $7,059,537,000 at the end of 2018[37] - The total unsecured and secured debt as of March 31, 2019, was $2.735 billion, compared to $2.640 billion as of December 31, 2018[110] - The Company has a total debt of $2,735.2 million, with $424.0 million due in the remaining part of 2019 and $365.1 million due in 2020[122] Cash and Cash Equivalents - Cash and cash equivalents were $52,445,000 as of March 31, 2019, slightly down from $53,740,000 at December 31, 2018[22] - Cash and cash equivalents decreased from $78.9 million at the beginning of Q1 2018 to $52.4 million at the end of Q1 2019[195] - The company had cash and cash equivalents of $66.1 million at the end of Q1 2019, down from $74.98 million at the end of Q1 2018, representing a decrease of about 11.5%[50] Revenue Streams - Office segment revenues increased to $175.9 million in Q1 2019 from $156.5 million in Q1 2018, while studio segment revenues rose to $21.5 million from $17.6 million[190] - Ancillary revenues for the Company were $8,086 thousand for the three months ended March 31, 2019, compared to $5,320 thousand for the same period in 2018[81] - Guest parking revenues increased to $6,447 thousand for the three months ended March 31, 2019, from $5,413 thousand in the prior year[81] Shareholder Information - The company paid dividends totaling $40,427,000 to common stock and unit-holders in Q1 2019, compared to $39,351,000 in Q1 2018[34] - The weighted average shares of common units outstanding were 155,120,144 for Q1 2019, slightly down from 156,195,100 in Q1 2018[40] - The basic weighted average common shares outstanding decreased to 154,396,159 in Q1 2019 from 155,626,055 in Q1 2018[170] - The company’s diluted weighted average common shares outstanding for Q1 2019 were 154,396,159, compared to 156,714,822 in Q1 2018[170] Debt and Financing - Proceeds from unsecured and secured debt in Q1 2019 amounted to $430.0 million, significantly higher than $130.0 million in Q1 2018[50] - The Company completed a public offering of $350 million of senior notes on February 27, 2019[113] - The operating partnership completed a public offering of $350.0 million in senior notes due April 1, 2029, with net proceeds of approximately $343.0 million used to repay outstanding borrowings[118] - The Company decreased outstanding borrowings on the unsecured revolving credit facility by $180.0 million during the three months ended March 31, 2019[117] Property and Development - Total properties in the company's portfolio as of March 31, 2019, included 52 office properties totaling 13,866,793 square feet and 3 studio properties totaling 1,224,403 square feet, amounting to a total of 15,091,196 square feet[53] - The Company has 683,090 square feet under redevelopment as of March 31, 2019[214] - Future development projects total 1,693,212 square feet, with several projects in Hollywood and West Los Angeles[214] - The company entered into an agreement to purchase the 1.45 million-square-foot Bentall Centre property in Vancouver, Canada, expected to close in Q2 2019[211] - The company anticipates the sale of the Campus Center property to close during Q2 2019, which includes both office property and developable land[215] Compliance and Governance - The Company was in compliance with its financial covenants as of March 31, 2019, maintaining required ratios across various metrics[132] - The Company has not established a liability for uncertain tax positions as of March 31, 2019[149] - The Company has assessed its tax positions for all open years and concluded that there are no material uncertainties to be recognized[150]

Part I [Business](index=5&type=section&id=ITEM%201.%20Business) Hudson Pacific Properties is a vertically integrated real estate company specializing in high-quality office and studio properties in key West Coast markets - As of December 31, 2018, the company's portfolio included approximately **13.9 million square feet** of office properties and **1.2 million square feet** of studio properties, with an additional **2.6 million square feet** of undeveloped density rights[20](index=20&type=chunk) - The company's business strategy focuses on investing in Class-A office and studio properties in innovation-centric submarkets, emphasizing value-add opportunities through repositioning and redevelopment[22](index=22&type=chunk) - The top 15 office tenants account for **37.2%** of total annualized office base rent, with Google, Inc. and Netflix, Inc. representing a combined **10.7%**[23](index=23&type=chunk) - The company operates through two segments: office and studio properties, with all business conducted across Northern and Southern California and the Pacific Northwest[30](index=30&type=chunk) - The company aims to reduce energy, water consumption, and greenhouse gas emissions by at least **10%** by 2025, compared to a 2016 baseline[46](index=46&type=chunk) [Risk Factors](index=11&type=section&id=ITEM%201A.%20Risk%20Factors) The company faces diverse risks, including geographic and tenant concentration, real estate market illiquidity, and challenges in maintaining REIT status - The company's portfolio is geographically concentrated in Northern and Southern California and the Pacific Northwest, increasing susceptibility to adverse local conditions[59](index=59&type=chunk) - A significant portion of rental revenue is derived from technology and media/entertainment tenants, exposing the company to industry-specific downturns[60](index=60&type=chunk) - As a REIT, the company must distribute at least **90%** of its net taxable income annually, potentially limiting internal capital for future needs and increasing reliance on external sources[66](index=66&type=chunk)[68](index=68&type=chunk) - The transition from LIBOR to alternative reference rates like SOFR after 2021 may adversely affect interest expense on the company's **$1.32 billion** of variable rate debt[75](index=75&type=chunk)[76](index=76&type=chunk) - Failure to maintain REIT status would result in significant adverse tax consequences, including federal corporate income tax and a four-year inability to re-elect REIT status[139](index=139&type=chunk) [Unresolved Staff Comments](index=29&type=section&id=ITEM%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments from the SEC - No unresolved staff comments were reported[156](index=156&type=chunk) [Properties](index=29&type=section&id=ITEM%202.%20Properties) As of December 31, 2018, the company's portfolio comprised 55 properties totaling **17.7 million square feet**, primarily office and studio, with significant tenant concentration in technology and media Portfolio Summary as of December 31, 2018 | Portfolio Segment | Number of Properties | Square Feet (sq. ft.) | Percent Leased (%) | | :--- | :--- | :--- | :--- | | **Office** | 52 | 13,853,401 | - | | - In-Service | 47 | 12,290,504 | 93.0% | | - Redevelopment/Development | 5 | 1,562,897 | - | | **Studio** | 3 | 1,224,403 | 91.9% (Avg) | | **Land** | - | 2,639,562 | - | | **Total** | **55** | **17,717,366** | - | Top 5 Office Tenants by Annualized Base Rent | Tenant | % of Office Portfolio Annualized Base Rent (%) | | :--- | :--- | | Google, Inc. | 6.3% | | Netflix, Inc. | 4.4% | | Square, Inc. | 3.4% | | Riot Games, Inc. | 3.0% | | Uber Technologies, Inc. | 3.0% | Office Portfolio Industry Diversification by Annualized Base Rent | Industry | % of Total (%) | | :--- | :--- | | Technology | 39.4% | | Media and Entertainment | 14.4% | | Legal | 8.9% | | Business Services | 8.8% | | Financial Services | 7.7% | | Other | 20.8% | - Approximately **9.0%** of the office portfolio's square footage, representing **10.2%** of annualized base rent, is scheduled to expire in 2019[183](index=183&type=chunk) [Legal Proceedings](index=37&type=section&id=ITEM%203.%20Legal%20Proceedings) The company is not currently involved in any material legal proceedings expected to adversely affect its operations - The company is not currently involved in any material legal proceedings[197](index=197&type=chunk) [Mine Safety Disclosures](index=37&type=section&id=ITEM%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - This item is not applicable[198](index=198&type=chunk) Part II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=38&type=section&id=ITEM%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on the NYSE, with a **$250.0 million** share repurchase program, and its five-year cumulative return outperformed the S&P 500 - The board authorized a **$250.0 million** share repurchase program, with **1,639,260 shares** repurchased in November 2018 at an average price of **$30.48**[204](index=204&type=chunk)[205](index=205&type=chunk) - There is no established public trading market for the operating partnership's common units[209](index=209&type=chunk) 5-Year Cumulative Total Return Comparison (2013-2018) | Index | 12/31/13 | 12/31/18 | Cumulative Return (%) | | :--- | :--- | :--- | :--- | | Hudson Pacific Properties, Inc. | $100.00 | $150.57 | 50.57% | | S&P 500 | $100.00 | $150.33 | 50.33% | | MSCI US REIT | $100.00 | $145.55 | 45.55% | | SNL U.S. REIT Office | $100.00 | $119.86 | 19.86% | [Selected Financial Data](index=41&type=section&id=ITEM%206.%20Selected%20Financial%20Data) In 2018, total office revenues slightly decreased to **$652.5 million**, while studio revenues increased to **$75.9 million**, and net income rose to **$111.8 million** Selected Financial Data (in thousands) | Metric | 2018 ($ thousands) | 2017 ($ thousands) | 2016 ($ thousands) | | :--- | :--- | :--- | :--- | | **Statements of Operations Data** | | | | | Total office revenues | $652,517 | $667,110 | $593,236 | | Total studio revenues | $75,901 | $61,029 | $46,403 | | Net income (loss) | $111,781 | $94,561 | $43,758 | | **Per Share Data** | | | | | Net income (loss) attributable to common stockholders—diluted | $0.63 | $0.44 | $0.25 | | Dividends declared per common share | $1.000 | $1.000 | $0.800 | | **Balance Sheet Data (End of Period)** | | | | | Total assets | $7,070,879 | $6,622,070 | $6,678,998 | | Unsecured and secured debt, net | $2,623,835 | $2,421,380 | $2,688,010 | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=43&type=section&id=ITEM%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) In 2018, the company executed strategic acquisitions and dispositions, resulting in a **2.9%** decrease in Net Operating Income to **$460.7 million** and **$292.9 million** in Funds from Operations - During 2018, the company acquired **916,701 square feet** of properties for **$521.0 million** and disposed of **815,226 square feet** of office properties for **$464.8 million**, realizing **$43.3 million** in gains[235](index=235&type=chunk)[239](index=239&type=chunk) Net Operating Income (NOI) Reconciliation (in thousands) | | Year Ended Dec 31, 2018 ($ thousands) | Year Ended Dec 31, 2017 ($ thousands) | $ Change (thousands) | % Change (%) | | :--- | :--- | :--- | :--- | :--- | | **Net Income** | **$111,781** | **$94,561** | **$17,220** | **18.2%** | | Adjustments | 348,927 | 380,071 | (31,144) | (8.2)% | | **NOI** | **$460,708** | **$474,632** | **($13,924)** | **(2.9)%** | | Same-store NOI | $294,441 | $289,087 | $5,354 | 1.9% | | Non-same-store NOI | $166,267 | $185,545 | ($19,278) | (10.4)% | - The **2.9%** decrease in total NOI was primarily due to a **$25.6 million** decline in non-same-store office NOI from property sales and redevelopments, partially offset by increases in same-store office and total studio NOI[295](index=295&type=chunk) Funds From Operations (FFO) Reconciliation (in thousands) | | 2018 ($ thousands) | 2017 ($ thousands) | | :--- | :--- | :--- | | Net income | $111,781 | $94,561 | | Adjustments | 181,142 | 211,495 | | **FFO to Common Stockholders and Unitholders** | **$292,923** | **$306,056** | - As of December 31, 2018, the company held **$53.7 million** in cash and cash equivalents, with **$200.0 million** remaining borrowing capacity under its **$600.0 million** unsecured revolving credit facility[343](index=343&type=chunk)[346](index=346&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=65&type=section&id=ITEM%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate fluctuations, with **$1.32 billion** in variable-rate debt partially hedged by interest rate swaps - The company's main market risk stems from interest rate fluctuations, which it manages using derivative instruments like interest rate swaps[364](index=364&type=chunk) Debt Profile as of December 31, 2018 (in thousands) | Debt Type | Carrying Value ($ thousands) | | :--- | :--- | | Variable rate | $1,319,501 | | - *Effectively fixed via swaps* | *$839,500* | | Fixed rate | $1,320,232 | | **Total Unsecured and Secured Debt** | **$2,639,733** | - A **100 basis point (1.0%)** increase in the one-month LIBOR would increase annual interest expense by approximately **$4.8 million**[369](index=369&type=chunk) [Financial Statements and Supplementary Data](index=66&type=section&id=ITEM%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section refers to the consolidated financial statements listed in Part IV, Item 15(a) of the report - This item refers to the consolidated financial statements listed in Part IV, Item 15(a) of the Form 10-K[370](index=370&type=chunk) [Changes in and Disagreements With Accountants on Accounting and Financial Disclosure](index=66&type=section&id=ITEM%209.%20Changes%20in%20and%20Disagreements%20With%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) This item is not applicable to the company - This item is not applicable[371](index=371&type=chunk) [Controls and Procedures](index=66&type=section&id=ITEM%209A.%20Controls%20and%20Procedures) Management concluded that disclosure controls and internal control over financial reporting were effective as of December 31, 2018, with no material changes during the fourth quarter - Management concluded that disclosure controls and procedures for both Hudson Pacific Properties, Inc. and its operating partnership were effective as of the report period end[375](index=375&type=chunk)[378](index=378&type=chunk) - No material changes occurred in internal control over financial reporting during the fourth quarter of 2018[379](index=379&type=chunk)[380](index=380&type=chunk) - Management assessed the company's internal control over financial reporting as effective based on the COSO 2013 framework, a conclusion audited and confirmed by Ernst & Young LLP[383](index=383&type=chunk)[388](index=388&type=chunk) [Other Information](index=68&type=section&id=ITEM%209B.%20Other%20Information) This item is not applicable to the company - This item is not applicable[389](index=389&type=chunk) Part III [Directors, Executive Officers and Corporate Governance](index=69&type=section&id=ITEM%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information for this item is incorporated by reference from the company's 2019 Annual Meeting of Stockholders proxy statement - Information is incorporated by reference from the definitive proxy statement for the 2019 Annual Meeting of Stockholders[392](index=392&type=chunk) [Executive Compensation](index=69&type=section&id=ITEM%2011.%20Executive%20Compensation) Information for this item is incorporated by reference from the company's 2019 Annual Meeting of Stockholders proxy statement - Information is incorporated by reference from the definitive proxy statement for the 2019 Annual Meeting of Stockholders[393](index=393&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=69&type=section&id=ITEM%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Information for this item is incorporated by reference from the company's 2019 Annual Meeting of Stockholders proxy statement - Information is incorporated by reference from the definitive proxy statement for the 2019 Annual Meeting of Stockholders[394](index=394&type=chunk) [Certain Relationships and Related Transactions, and Director Independence](index=69&type=section&id=ITEM%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Information for this item is incorporated by reference from the company's 2019 Annual Meeting of Stockholders proxy statement - Information is incorporated by reference from the definitive proxy statement for the 2019 Annual Meeting of Stockholders[395](index=395&type=chunk) [Principal Accountant Fees and Services](index=69&type=section&id=ITEM%2014.%20Principal%20Accountant%20Fees%20and%20Services) Information for this item is incorporated by reference from the company's 2019 Annual Meeting of Stockholders proxy statement - Information is incorporated by reference from the definitive proxy statement for the 2019 Annual Meeting of Stockholders[396](index=396&type=chunk) Part IV [Exhibits, Financial Statement Schedules](index=70&type=section&id=ITEM%2015.%20Exhibits%2C%20Financial%20Statement%20Schedules) This section lists consolidated financial statements and a comprehensive array of exhibits filed with the Form 10-K - This section includes consolidated financial statements for both Hudson Pacific Properties, Inc. and Hudson Pacific Properties, L.P., along with Schedule III - Real Estate and Accumulated Depreciation[399](index=399&type=chunk) - A detailed list of exhibits is provided, including corporate governance documents, debt agreements, material contracts, and executive compensation plans[400](index=400&type=chunk) [Form 10-K Summary](index=73&type=section&id=ITEM%2016.%20Form%2010-K%20Summary) This item is not applicable to the company - This item is not applicable[406](index=406&type=chunk)