Segments

12 Months Ended

Dec. 31, 2023

Segment Reporting [Abstract]

Segments

17. Segments

The Company has four business segments that offer different products and services. HHC’s four segments are managed separately because each requires different operating strategies or management expertise and are reflective of management’s operating philosophies and methods. Because the Company’s four segments, Operating Assets, MPC, Seaport, and Strategic Developments, are managed separately, the Company uses different operating measures to assess operating results and allocate resources among them. The one common operating measure used to assess operating results for the Company’s business segments is earnings before tax (EBT). EBT, as it relates to each business segment, includes the revenues and expenses of each segment, as shown below. EBT excludes corporate expenses and other items that are not allocable to the segments. The Company presents EBT for each segment because the Company use this measure, among others, internally to assess the core operating performance of the Company’s assets. The Company’s segments or assets within such segments could change in the future as development of certain properties commences or other operational or management changes occur. All operations are within the United States. The Company’s reportable segments are as follows:

–Operating Assets – consists of developed or acquired retail, office, and multi-family properties along with other real estate investments. These properties are currently generating revenues and may be redeveloped, repositioned, or sold to improve segment performance or to recycle capital.

–MPC – consists of the development and sale of land in large‑scale, long‑term community development projects in and around Las Vegas, Nevada; Houston, Texas; and Phoenix, Arizona.

–Seaport – consists of approximately 472,000 square feet of restaurant, retail, and entertainment properties situated in three primary locations in New York City: Pier 17, Historic Area/Uplands, and Tin Building as well as the 250 Water Street development, and equity interest in Jean-Georges Restaurants.

–Strategic Developments – consists of residential condominium and commercial property projects currently under development and all other properties held for development which have no substantial operations.

Segment operating results are as follows:

thousands	Operating Assets Segment (a)		MPC Segment		Seaport Segment		Strategic Developments Segment		Total
Year Ended December 31, 2023
Total revenues	$	443,632	$	448,452	$	81,971	$	49,987	$	1,024,042
Total operating expenses	(210,166)		(193,470)		(103,466)		(80,472)		(587,574)
Segment operating income (loss)	233,466		254,982		(21,495)		(30,485)		436,468
Depreciation and amortization	(170,731)		(418)		(37,791)		(3,963)		(212,903)
Interest income (expense), net	(127,388)		64,291		3,065		16,074		(43,958)
Other income (loss), net	1,843		(102)		(1,290)		690		1,141
Equity in earnings (losses) from unconsolidated ventures	2,969		22,666		(81,485)		142		(55,708)
Gain (loss) on sale or disposal of real estate and other assets, net	23,926		—		—		236		24,162
Gain (loss) on extinguishment of debt	(96)		—		(48)		—		(144)
Provision for impairment	—		—		(672,492)		—		(672,492)
Segment EBT	$	(36,011)	$	341,419	$	(811,536)	$	(17,306)	$	(523,434)
Corporate income, expenses, and other items									(27,274)
Net income (loss)									(550,708)
Net (income) loss attributable to noncontrolling interests									(243)
Net income (loss) attributable to HHH									$	(550,951)

thousands	Operating Assets Segment (a)		MPC Segment		Seaport Segment		Strategic Developments Segment		Total
Year Ended December 31, 2022
Total revenues	$	431,834	$	408,365	$	88,468	$	679,763	$	1,608,430
Total operating expenses	(194,496)		(173,905)		(104,393)		(504,036)		(976,830)
Segment operating income (loss)	237,338		234,460		(15,925)		175,727		631,600
Depreciation and amortization	(154,626)		(394)		(36,338)		(5,319)		(196,677)
Interest income (expense), net	(89,959)		50,305		3,902		17,073		(18,679)
Other income (loss), net	(1,140)		23		245		1,799		927
Equity in earnings (losses) from unconsolidated ventures	22,263		(1,407)		(36,273)		868		(14,549)
Gain (loss) on sale or disposal of real estate and other assets, net	29,588		—		—		90		29,678
Gain (loss) on extinguishment of debt	(2,230)		—		—		—		(2,230)
Segment EBT	$	41,234	$	282,987	$	(84,389)	$	190,238	$	430,070
Corporate income, expenses, and other items									(245,434)
Net income (loss)									184,636
Net (income) loss attributable to noncontrolling interests									(103)
Net income (loss) attributable to HHH									$	184,533
Year Ended December 31, 2021
Total revenues	$	442,698	$	409,746	$	55,008	$	520,109	$	1,427,561
Total operating expenses	(209,020)		(193,851)		(77,198)		(436,698)		(916,767)
Segment operating income (loss)	233,678		215,895		(22,190)		83,411		510,794
Depreciation and amortization	(163,031)		(366)		(30,867)		(6,512)		(200,776)
Interest income (expense), net	(75,391)		42,683		357		3,701		(28,650)
Other income (loss), net	(10,746)		—		(3,730)		2,536		(11,940)
Equity in earnings (losses) from unconsolidated ventures	(67,042)		59,399		(1,988)		(221)		(9,852)
Gain (loss) on sale or disposal of real estate and other assets, net	39,168		—		—		13,911		53,079
Gain (loss) on extinguishment of debt	(1,926)		(1,004)		—		—		(2,930)
Provision for impairment	—		—		—		(13,068)		(13,068)
Segment EBT	$	(45,290)	$	316,607	$	(58,418)	$	83,758	$	296,657
Corporate income, expenses, and other items									(247,733)
Net income (loss)									48,924
Net (income) loss attributable to noncontrolling interests									7,176
Net income (loss) attributable to HHH									$	56,100

(a)Total revenues includes hospitality revenues of $35.6 million for the year ended December 31, 2021. Total operating expenses includes hospitality operating costs of $30.5 million for the year ended December 31, 2021. In September 2021, the Company completed the sale of its three hospitality properties. Refer to Note 3 - Acquisitions and Dispositions for additional information.

The following represents assets by segment and the reconciliation of total segment assets to Total assets in the Consolidated Balance Sheets as of December 31:

thousands	2023		2022
Operating Assets	$	3,577,694	$	3,448,823
Master Planned Communities	3,358,821		3,272,655
Seaport (a)	485,898		1,166,950
Strategic Developments	1,638,955		1,359,180
Total segment assets	9,061,368		9,247,608
Corporate	514,244		355,855
Total assets	$	9,575,612	$	9,603,463

(a)In 2023, the Company recorded a $709.5 million impairment charge related to the Seaport segment. Refer to Note 4 - Impairment for additional information.