- Bill Ackman’s Pershing Square Capital is considering taking Howard Hughes Corporation private, potentially involving co-investors.
- Pershing Square, Howard Hughes’ largest shareholder, controls about 38% of the company’s stock.
- Howard Hughes shifted focus entirely to real estate after spinning off its entertainment assets into Seaport Entertainment Group.
According to a recent filing with the Securities and Exchange Commission (SEC), Bill Ackman’s Pershing Square Capital is exploring the possibility of taking Howard Hughes Corporation (HHH) private.
Deal Details
As reported in The Real Deal, Pershing Square already holds 18.9M shares of HHH, or a 38% stake in the Houston-based master-planned community developer.
The filing indicated that Pershing Square might involve one or more co-investors in the deal, although it left room for various alternatives without specifying them. A take-private transaction, however, was the only option explicitly mentioned in the disclosure.
Notably, the potential privatization follows Howard Hughes’ spinoff of its entertainment assets into a new entity, Seaport Entertainment Group.
Strategic Refocus
This potential deal follows Howard Hughes’ spinoff of its entertainment assets into a new entity, Seaport Entertainment Group.
Seaport’s assets include retail, dining, and entertainment space in lower Manhattan, a stake in Jean-Georges restaurants, and a minor league baseball team in Las Vegas, have now been separated from Howard Hughes’ main portfolio. Pershing Square also holds about 38% of Seaport Entertainment.
With the entertainment assets spun off, Howard Hughes is now dedicated entirely to real estate development. The company’s portfolio includes over 100K acres of land, with a significant portion in its land bank. Its developments, particularly The Woodlands in Texas, have been highly influential, setting the stage for the state’s master-planned community market.
What’s Next
In response to Pershing Square’s interest, Howard Hughes announced it would form a committee of independent directors to evaluate the potential take-private transaction. The company stated that it would not comment further until it deems additional disclosure necessary or legally required.
Bill Ackman’s involvement with Howard Hughes dates back to the company’s origins as a spin-off from General Growth Properties in 2010. Despite stepping down as chairman earlier this year, Ackman’s continued influence through Pershing Square remains significant.
As the situation develops, all eyes will be on how this potential take-private deal unfolds, particularly given the recent changes in Howard Hughes’ business structure and market focus.
