- Cohen & Steers has invested $300M in Hudson Pacific Properties (HPP), purchasing 43% of a $600M public stock offering to recapitalize the struggling REIT.
- The investment is aimed at helping HPP reduce debt, extend loan maturities, and improve occupancy across its office and studio portfolio.
- HPP reported consecutive years of net losses and has been selling properties and refinancing loans to stabilize its balance sheet and reposition for recovery.
A Strategic Recapitalization
Cohen & Steers, a global asset manager focused on listed real estate, has taken a bold position in the West Coast’s challenged office market. The firm acquired $300M worth of stock in Hudson Pacific Properties (NYSE: HPP), reports Bisnow. The purchase represents 43% of HPP’s recent $600M public offering and comes at a critical juncture for the REIT.
Why Now
“The West Coast office market recovery is underway and poised to gain momentum,” said Jason Yablon, EVP at Cohen & Steers. The firm’s investment underscores a belief that HPP—whose portfolio spans office and film studio properties in key markets like Los Angeles, San Francisco, and Seattle—is positioned to benefit from any market turnaround.
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Financial Pressure Mounts
HPP has struggled in recent years, reporting a net loss of $381M in 2024 following a $171M loss the previous year. Declining occupancy across its portfolio prompted the REIT to launch a disposition strategy earlier this year. It has since sold the Foothill Research Center in Palo Alto and Maxwell in Los Angeles for a combined $69M and is under contract to sell another asset in San Francisco for $28M.
Debt Strategy And Leasing Activity
The recapitalization, alongside the proceeds from the property sales, is intended to reduce the company’s leverage and fund leasing and occupancy initiatives. HPP also closed a $475M CMBS refinancing in March, backing a six-property portfolio. Leasing activity is showing signs of recovery, with 630K SF signed in Q1 2025—the busiest quarter in three years.
What’s Next
Cohen & Steers’ backing signals growing institutional confidence in a rebound for urban office markets on the West Coast. HPP’s efforts to stabilize its portfolio could make it a bellwether for broader recovery in the sector—if demand continues to return.
Why It Matters
As office REITs struggle nationally, investors like Cohen & Steers are selectively placing large bets on potential recovery plays. HPP’s recapitalization could offer a blueprint for similarly distressed landlords looking to reposition for a post-pandemic future.
