# Seaport Entertainment Group Inc.: Form 10-Q for the period ended Mar 31, 2025

- Company: [Seaport Entertainment Group Inc.](/companies/seg.md) (CIK 2009684)
- Form: 10-Q
- Filed: 2025-05-12
- Accepted by EDGAR: May 12, 2025, 20:38 ET
- Period: 2025-03-31
- Accession: 0001558370-25-007409
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/2009684/000155837025007409/seg-20250331x10q.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/2009684/000155837025007409/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2025-03-31.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Revenue | 3 months, 2025-01-01 to 2025-03-31 | $16.1m | us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax |
| Operating income | 3 months, 2025-01-01 to 2025-03-31 | −$32.7m | us-gaap:OperatingIncomeLoss |
| Income tax | 3 months, 2025-01-01 to 2025-03-31 | $0 | us-gaap:IncomeTaxExpenseBenefit |
| Net income | 3 months, 2025-01-01 to 2025-03-31 | −$31.9m | us-gaap:NetIncomeLoss |
| Diluted EPS | 3 months, 2025-01-01 to 2025-03-31 | −$2.51 | us-gaap:EarningsPerShareDiluted |
| Basic EPS | 3 months, 2025-01-01 to 2025-03-31 | −$2.51 | us-gaap:EarningsPerShareBasic |
| Diluted shares (weighted) | 3 months, 2025-01-01 to 2025-03-31 | 12,694,000 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Operating cash flow | 3 months, 2025-01-01 to 2025-03-31 | −$20.5m | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Cash and equivalents | at 2025-03-31 | $129.9m | us-gaap:CashAndCashEquivalentsAtCarryingValue |
| Total assets | at 2025-03-31 | $718.4m | us-gaap:Assets |
| Total liabilities | at 2025-03-31 | $177.4m | us-gaap:Liabilities |
| Long-term debt | at 2025-03-31 | $101.6m | us-gaap:LongTermDebt |
| Shareholders' equity | at 2025-03-31 | $531.2m | us-gaap:StockholdersEquity |

## Management's discussion and analysis

As filed, 50,176 characters.

Unless the context otherwise requires, references in this Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) to “Seaport Entertainment Group,” “SEG,” the “Company,” “we,” “us,” or “our” shall mean the assets, liabilities, and operating activities related to the Seaport Entertainment division of Howard Hughes Holdings Inc. (“HHH”) that was transferred to Seaport Entertainment Group Inc. on July 31, 2024 in connection with the Company’s separation from HHH (the “Separation”), as well as the assets, liabilities, and operating activities of Seaport Entertainment Group Inc. The following discussion should be read as a supplement to and should be read in conjunction with our Unaudited Consolidated and Combined Financial Statements (“Unaudited Consolidated and Combined Financial Statements”) and the related notes included elsewhere in this quarterly report on Form 10-Q (“Quarterly Report”). This discussion contains forward-looking statements that involve risks, uncertainties, assumptions, and other factors, including those described elsewhere in this Quarterly Report and in our Annual Report on Form 10-K for the year ended December 31, 2024. Actual results could differ materially from those discussed in or implied by forward-looking statements as a result of these factors. You are cautioned not to place undue reliance on this information which speaks only as of the date of this Quarterly Report. We are not obligated to update this information, whether as a result of new information, future events or otherwise, except as may be required by law.

All references to numbered Notes are specific to Unaudited Notes to the Consolidated and Combined Financial Statements included in this Quarterly Report. Capitalized terms used, but not defined, in this MD&A have the same meanings as in such Notes.

Changes for monetary amounts between periods presented are calculated based on the amounts in thousands of dollars stated in our Unaudited Consolidated and Combined Financial Statements and then rounded to the nearest million. Therefore, certain changes may not recalculate based on the amounts rounded to the nearest million.

### Overview

### General Overview

The Company was formed to own, operate, and develop a unique collection of assets positioned at the intersection of entertainment and real estate. Our existing portfolio encompasses a wide range of leisure and recreational activities, including live concerts, fine dining, nightlife, professional sports, and high-end and experiential retail. We primarily analyze our portfolio of assets through the lens of our three operating segments: (1) Hospitality, (2) Entertainment (previously Sponsorships, Events, and Entertainment), and (3) Landlord Operations, and are focused on realizing value for stockholders primarily through dedicated management of existing assets, expansion of partnerships, strategic acquisitions, and completion of development and redevelopment projects.

#### Hospitality

Hospitality represents our ownership interests in various food and beverage operating businesses and sponsorship agreements related to these businesses. We own, either wholly or through partnerships with third parties, and operate, including license and management agreements, fine dining and casual dining restaurants, cocktail bars, nightlife and entertainment venues (The Fulton, Mister Dips, Carne Mare, Malibu Farm and Gitano), as well as the Tin Building by Jean-Georges, which offers a variety of culinary experiences, including restaurants, bars, grocery markets, retail, and private dining, and our unconsolidated venture, the Lawn Club. These businesses are all our tenants and are part of our Landlord Operations. We also have a 25% interest in Jean-Georges Restaurants. Creative Culinary Management Company (“CCMC”), a wholly owned indirect subsidiary of Jean-Georges Restaurants and a related party of the Company, provides management services for certain retail and food and beverage businesses in the Seaport. On January 1, 2025, as the Company’s initial step to internalize food and beverage operations at most of its wholly owned and joint venture-owned restaurants at the Seaport, we hired and onboarded employees of CCMC and entered into a services agreement with CCMC. We aim to capitalize on opportunities in the food and beverage space to leverage growing consumer appetite for unique restaurant experiences as a catalyst to further expand the Company’s culinary footprint. Our Hospitality-related period-over-period comparisons do not adjust for operational revisions to our asset strategies from period to period, such as opening or closing restaurant concepts or redirecting operations to use space for private events and/or concerts.

#### Entertainment

Entertainment includes the Las Vegas Aviators Triple-A Minor League Baseball team (the “Aviators”) and the Las Vegas Ballpark, our interest in and to the Fashion Show Mall Air Rights, events at The Rooftop at Pier 17, and sponsorship agreements related to these venues. The Aviators are a Triple-A affiliate of the Oakland Athletics and play at the Las Vegas Ballpark, a 10,000-person capacity ballpark located in Downtown Summerlin. The Rooftop at Pier 17 is a premier outdoor concert venue that hosts a popular Summer Concert Series featuring emerging and established musicians alike. Commencing in the fourth quarter of 2025, we plan to launch year-round concerts and events for The Rooftop at Pier 17 utilizing a seasonal floor-to-ceiling glass enclosure for the winter months. We see The Rooftop at Pier 17 as an opportunity to continue to drive events and entertainment growth as we believe that the demand for live music is strong and accelerating.

#### Landlord Operations

Landlord Operations represents our ownership interests in and operation of physical real estate assets located in the Seaport, a historic neighborhood in Lower Manhattan on the banks of the East River and within walking distance of the Brooklyn Bridge. Landlord Operations assets include:

- Pier 17, a mixed-use building containing restaurants, entertainment, office space, and The Rooftop at Pier 17, an outdoor concert venue;
- the Tin Building, a mixed-use building containing a culinary destination featuring a variety of experiences including restaurants, bars, grocery markets, retail, and private dining;
- the Fulton Market Building, a mixed-use building containing office and retail spaces, including a movie theater and the Lawn Club, an experiential retail concept focused on “classic lawn games” and cocktails;
- the Historic District retail and other locations which include the Museum Block, Schermerhorn Row, and more;
- 250 Water Street, a full block development site approved for zoning of affordable and market-rate housing, office, retail, and community-oriented gathering space; and
- 85 South Street, an eight-story residential building.

Our assets included in the Landlord Operations segment primarily sit under a long-term ground lease from the City of New York with extension options through 2120. We are focused on continuing to fill vacancies in our Landlord Operations portfolio and believe this to be an opportunity to drive incremental segment growth.

### Separation from HHH

On July 31, 2024, HHH completed its spin-off of the Company through the pro rata distribution of all the outstanding shares of common stock of SEG to HHH’s stockholders as of the close of business on the record date of July 29, 2024 (the “Separation”).

In connection with the Separation, on July 31, 2024, the Company entered into a separation and distribution agreement and various other agreements with HHH, including a transition services agreement, an employee matters agreement, and a tax matters agreement. Additionally, HHH contributed capital of $23.4 million to the Company prior to the Separation to support the operating, investing, and financing activities of the Company.

### Basis of Presentation

Prior to the Separation, we operated as part of HHH and not as a standalone company. Our financial statements for the periods until the Separation on July 31, 2024 are combined financial statements prepared on a carve-out basis and are derived from the accounting records of HHH. Our financial statements for the periods beginning on and after August 1, 2024 are consolidated financial statements based on our financial position, results of operations and cash flows as a standalone company. Accordingly, the accompanying Unaudited Consolidated Financial Statements as of March 31, 2025 and December 31, 2024 and for the three months ended March 31, 2025 have been prepared on a standalone basis and are derived from the accounting records of the Company. The accompanying Unaudited Combined Financial Statements for the three months ended March 31, 2024 have been prepared on a carve-out basis and are derived from the combined financial statements and accounting records of HHH.

The accompanying Unaudited Consolidated and Combined Financial Statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The accompanying Unaudited Consolidated and Combined Financial Statements may not be indicative of the Company’s future performance and do not necessarily reflect what the Company’s financial position, results of operations, and cash flows would have been had the Company operated as a standalone company during all of the periods presented.

For an additional discussion on the basis of presentation of the accompanying Unaudited Consolidated and Combined Financial Statements, see Note 1 – *Summary of Significant Accounting Policies* in the Unaudited Notes to the Consolidated and Combined Financial Statements included in this Quarterly Report.

### Key Factors Affecting Our Business

We believe that our performance and future success depend on a number of factors that present significant opportunities for us but also pose risks and challenges, including those discussed below and in Part I, Item 1A, “Risk Factors,” in our Annual Report on Form 10-K for the year ended December 31, 2024.

### Management Strategies and Operational Changes

As discussed elsewhere in this Quarterly Report, we historically operated as part of HHH and not as a standalone company. Therefore, our historical results prior to the Separation are reflective of the management strategies and operations of the Company based on the direction and strategies of HHH. Additionally, our historical results reflect the allocation of expenses from HHH associated with certain services prior to the Separation, including (1) certain support functions that were provided on a centralized basis within HHH, including but not limited to property management, development, executive oversight, treasury, accounting, finance, internal audit, legal, information technology, human resources, communications, and risk management; and (2) employee benefits and compensation, including stock-based compensation. The Company’s Unaudited Combined Financial Statements for the three months ended March 31, 2024 reflect an allocation of these costs. As a standalone public company, our ongoing costs related to such support functions may differ from, and may potentially exceed, the amounts that have been allocated to the Company in the Company’s Unaudited Combined Financial Statements for the three months ended March 31, 2024. Following the Separation, HHH continues to provide some of these services on a transitional basis in exchange for agreed-upon fees. In addition to one-time costs to design and establish our corporate functions, we will also incur incremental costs associated with being a standalone public company, including additional labor costs, such as salaries, benefits, and potential bonuses and/or stock based compensation awards for staff additions to establish certain corporate functions historically supported by HHH and not covered by the transition services agreement, and corporate governance costs, including board of director compensation and expenses, audit and other professional services fees, annual report and proxy statement costs, Securities and Exchange Commission (“SEC”) filing fees, transfer agent fees, consulting and legal fees and stock exchange listing fees. As a standalone company, our future results and cost structure may differ based on new strategies and operational changes implemented by our management team, which may include changes to our chosen organizational structure, whether functions are outsourced or performed by Company employees, and strategic decisions made in areas such as executive leadership, corporate infrastructure, and information technology.

### Tin Building and our Investment in the Tin Building by Jean-Georges

The Company owns 100% of the Tin Building which was completed and placed in service in our Landlord Operations segment during the third quarter of 2022. The Company leases 100% of the rentable space in the Tin Building to the Tin Building by Jean-Georges joint venture, a Hospitality segment business in which we recognized 100% of the economic interest in accordance with the equity method through December 31, 2024. As of January 1, 2025, in conjunction with the internalization of food and beverage operations, the Company began consolidating the Tin Building by Jean-Georges joint venture within the Hospitality segment. The Company recognizes lease payments from the Tin Building by Jean-Georges in Rental revenue within the Landlord Operations segment. As the Company recognizes 100% of operating income or losses from the Tin Building by Jean-Georges, the Tin Building lease has no net impact to the Company’s total net loss. However, Landlord Operations Adjusted EBITDA, as defined below, includes only rental revenue related to the Tin Building lease payments, and does not include rent expense in Equity in losses from unconsolidated ventures for the three months ended March 31, 2024 or rent expense for the three months ended March 31, 2025 included in Hospitality costs in Hospitality Adjusted EBITDA. The rental revenue and hospitality costs associated with the lease payments are eliminated in the Unaudited Consolidated Statement of Operations for the three months ended March 31, 2025. See Note 2 – *Investments in Unconsolidated Ventures* in the Unaudited Notes to the Consolidated and Combined Financial Statements included in this Quarterly Report for additional details related to the Tin Building by Jean-Georges joint venture and unaudited pro forma information.

The Tin Building by Jean-Georges is managed by CCMC, a related party that is indirectly owned by Jean-Georges Restaurants. The Tin Building by Jean-Georges had a soft opening in August 2022 and a grand opening celebration in late September 2022, with an expanded focus on experiences including in-person dining, retail shopping and delivery and limited operating hours. In 2023, the Tin Building by Jean-Georges was open seven days per week, with strong foot traffic and sales. However, operating losses at the Tin Building by Jean-Georges joint venture remained elevated, as the venture continues to refine its operating model. Performance at the Tin Building by Jean-Georges improved in 2024 and into the first quarter of 2025, primarily due to reductions in operating and labor costs. As the Company currently funds any operating shortfall and recognizes all of the economic interest in the venture, the future success of the Tin Building by Jean-Georges may have a significant impact on our results of operations.

### Seasonality

Our operations are highly seasonal and are significantly impacted by weather conditions. Concerts at our outdoor venue and Aviators baseball games primarily occur from May through October, and we typically see increased customer traffic at our restaurants during the summer months when the weather is generally warmer and more favorable, which contributes to higher revenue during these periods. However, weather-related disruptions, such as floods and heavy rains, can negatively impact our summer operations. For instance, outdoor concerts may have to be cancelled or rescheduled due to inclement weather, which can result in lost revenue. Similarly, floods can lead to temporary closures of our restaurants and can disrupt our supply chain, leading to potential revenue losses and increased costs.

During the fall and winter months, our operations tend to slow down due to the colder weather which results in fewer outdoor events, less foot traffic at our restaurants, and the end of the Aviators baseball season. This seasonality pattern results in lower revenues during these periods. Moreover, severe winter weather conditions, such as snowstorms and freezing temperatures, can further deter customers from visiting our restaurants, further impacting our revenues and cash flow. Our seasonality also results in fluctuations in cash and cash equivalents, accounts receivable, deferred expenses, and accounts payable and other liabilities at different times during the year.

### Lease Renewals and Occupancy

As of March 31, 2025, the average remaining term of our retail, office, and other properties leases where we are the lessor was approximately six years, excluding renewal options. The stability of the rental revenue generated by our properties depends principally on our tenants’ ability to pay rent and our ability to collect rents, renew expiring leases, re-lease space upon the expiration or other termination of leases, lease currently vacant properties, and maintain or increase rental rates at our leased properties. To the extent our properties become vacant, we would forego rental income while remaining responsible for the payment of property taxes and maintaining the property until it is re-leased, which could negatively impact our operating results. In January 2025, the Company entered into a lease with immersive entertainment and experience creator, Meow Wolf, to occupy approximately 74,000 square feet of vacant space in Pier 17, inclusive of a space currently occupied and expiring in December 2025. We continue to monitor our lease renewals and occupancy rates. As of March 31, 2025, our real estate assets at the Seaport were 83% leased or programmed.

### Inflationary Pressures and Other Macroeconomic Trends

Financial results across all our segments may be impacted by inflation. In Landlord Operations, certain of our leases contain rent escalators that increase rent at a fixed amount and may not be sufficient during periods of high inflation. For properties leased to third-party tenants, the impact of inflation on our property and operating expenses is limited as substantially all our leases are net leases, and property-level expenses are generally reimbursed by our tenants. Inflation and increased costs may also have an adverse impact on our tenants and their creditworthiness if the increase in property-level expenses is greater than their increase in revenues. For unleased properties and properties occupied by our restaurants, we are more exposed to inflationary pressures on property and operating expenses. For our Hospitality and Entertainment segments, inflationary pressure has a direct impact on our profitability due to increases in our costs, as well as potential reductions in customers that could negatively impact revenue. Although certain indicators have suggested that inflation has made downward progress, the economy continues to be impacted by elevated inflation rates and faces further inflation risk.

Other adverse economic conditions, including slower economic growth and the potential for a recession, could also have an adverse effect on us, our tenants and consumers. For example, rapid changes in U.S. trade policy, new or increased tariffs, retaliatory tariffs and global trade disruptions could negatively impact us or our tenants, including by further aggravating inflation, increasing costs, disrupting supply chains and negatively affecting consumer sentiment and spending.

### Significant Items Impacting Comparability

*Separation Costs.* The Company incurred pre-tax charges related to the planned separation from HHH, primarily related to legal and consulting costs, of $9.2 million for the three months ended March 31, 2024. No costs related to the Separation were incurred or recorded for the three months ended March 31, 2025.

*Shared Service Costs.* Prior to the Separation, HHH provided the Company certain services, including (1) certain support functions that were provided on a centralized basis within HHH, including, but not limited to property management, development, executive oversight, treasury, accounting, finance, internal audit, legal, information technology, human resources, communications, and risk management; and (2) employee benefits and compensation, including stock-based compensation. The Company’s Unaudited Combined Financial Statements for the three months ended March 31, 2024 reflect an allocation of these costs. When specific identification or a direct attribution of costs based on time incurred for the Company’s benefit is not practicable, a proportional cost method is used, primarily based on revenue, headcount, payroll costs or other applicable measures. The Company recorded expenses associated with shared services that are not directly attributable to the Company of $3.6 million for the three months ended March 31, 2024.

*Tin Building by Jean-Georges.* On January 1, 2025, the Company became the primary beneficiary of the Tin Building by Jean-Georges and began consolidating the Company’s investment in this venture into the Company’s financial statements. During the three months ended March 31, 2024, the Company recognized 100% of the economic interest in the venture in accordance with the equity method within Equity in earnings (losses) from unconsolidated joint ventures in the Unaudited Consolidated and Combined Statements of Operations. See *Tin Building and our Investment in the Tin Building by Jean-Georges* above for additional details.

### Results of Operations

### Comparison of the Three Months Ended March 31, 2025 and 2024

The following table sets forth our operating results:

*in thousands except percentages*

| ​ ​ REVENUES | ​ ​ | ​ ​ Three Months Ended March 31, 2025 ​ | ​ | ​ ​ 2024 ​ | ​ ​ | ​ ​ ​ Change ​ $% ​ | ​ ​ | ​ | ​ ​ ​ ​ |
| --- | --- | ---: | --- | ---: | --- | ---: | --- | ---: | --- |
| Hospitality revenue | ​ | $7,735 | ​ | $4,077 | ​ | $3,658 | ​ | 90% | ​ |
| Entertainment revenue | ​ | ​ 4,209 | ​ | ​ 3,564 | ​ | ​ 645 | ​ | 18% | ​ |
| Rental revenue | ​ | 3,789 | ​ | 6,537 | ​ | (2,748) | ​ | (42)% | ​ |
| Other revenue | ​ | 336 | ​ | 333 | ​ | 3 | ​ | 1% | ​ |
| **Total revenue** | **​** | **16,069** | **​** | **14,511** | **​** | **1,558** | **​** | **11%** | **​** |
| **EXPENSES** | ​ |  | ​ |  | ​ | ​ | ​ |  | ​ |
| Hospitality costs | ​ | 15,742 | ​ | 6,268 | ​ | 9,474 | ​ | 151% | ​ |
| Entertainment costs | ​ | 7,077 | ​ | 6,381 | ​ | 696 | ​ | 11% | ​ |
| Operating costs | ​ | 8,079 | ​ | 8,563 | ​ | (484) | ​ | (6)% | ​ |
| General and administrative | ​ | 9,782 | ​ | 16,554 | ​ | (6,772) | ​ | (41)% | ​ |
| Depreciation and amortization | ​ | 8,091 | ​ | 8,074 | ​ | 17 | ​ | 0% | ​ |
| **Total expenses** | **​** | **48,771** | **​** | **45,840** | **​** | **2,931** | **​** | **6%** | **​** |
| **OTHER** | ​ |  | ​ |  | ​ | ​ | ​ |  | ​ |
| Other income, net | ​ | — | ​ | 8 | ​ | (8) | ​ | (100)% | ​ |
| Total other | ​ | — | ​ | 8 | ​ | (8) | ​ | (100)% | ​ |
| **Operating loss** | **​** | **(32,702)** | **​** | **(31,321)** | **​** | **(1,381)** | **​** | **(4)%** | **​** |
| Interest income (expense) | ​ | 994 | ​ | (2,546) | ​ | 3,540 | ​ | 139% | ​ |
| Equity in earnings (losses) from unconsolidated ventures | ​ | 170 | ​ | (10,211) | ​ | 10,381 | ​ | 102% | ​ |
| **Loss before income taxes** | **​** | **(31,538)** | **​** | **(44,078)** | **​** | **12,540** | **​** | **28%** | **​** |
| Income tax (benefit) expense | ​ | — | ​ | — | ​ | — | ​ | 0% | ​ |
| **Net loss** | ​ | ​ **(31,538)** | ​ | ​ **(44,078)** | ​ | ​ **12,540** | ​ | **28%** | ​ |
| Preferred distributions to noncontrolling interest in subsidiary | ​ | ​ (350) | ​ | ​ — | ​ | ​ (350) | ​ | **(100)%** | ​ |
| **Net loss attributable to common stockholders** | **​** | **$(31,888)** | **​** | **$(44,078)** | **​** | **$12,190** | **​** | **28%** | **​** |

Net loss attributable to common stockholders decreased $12.2 million, or 28%, to $31.9 million for the three months ended March 31, 2025, compared to $44.1 million in the prior-year period, primarily due to a $6.8 million decrease in general and administrative expenses and a $3.5 million increase in interest income.

The decrease in equity in losses from unconsolidated ventures and changes in hospitality revenue, rental revenue, and hospitality costs are primarily due to the consolidation of the Tin Building by Jean-Georges as of January 1, 2025.

### Items Included in Segment Adjusted EBITDA

Segment Adjusted EBITDA for each segment includes certain intersegment revenues and expenses that eliminate in the Consolidated Statements of Operations for all periods presented. See “Segment Operating Results” for discussion of significant variances in revenues and expenses included in Adjusted EBITDA.

### Items Excluded from Segment Adjusted EBITDA

The following includes information on the significant variances in expenses and other items not directly related to segment activities.

*General and Administrative*. General and administrative costs decreased $6.8 million to $9.8 million for the three months ended March 31, 2025, compared to $16.6 million in the prior-year period, primarily due to a $9.2 million decrease in separation costs, partially offset by a $2.4 million increase in personnel and overhead expenses.

*Interest Income (Expense)*. Interest income increased $3.5 million to $1.0 million for the three months ended March 31, 2025, compared to a net expense of $2.5 million in the prior-year period. This change is primarily due to a $1.5 million increase in interest income, a $1.0 million increase in amounts capitalized to development assets and a $1.0 million decrease in interest expense on secured mortgages payable.

### Segment Operating Results

#### Hospitality

#### Segment Adjusted EBITDA

The following table presents segment Adjusted EBITDA for Hospitality:

*in thousands except percentages*

| ​ ​ Hospitality Adjusted EBITDA(a) | ​ ​ ​ ​ | ​ ​ Three Months Ended March 31, 2025 | ​ | ​ ​ 2024 | ​ ​ ​ | ​ ​ ​ ​ Change $% | ​ ​ | ​ ​ | ​ ​ ​ | ​ ​ ​ ​ |
| --- | --- | ---: | --- | ---: | --- | ---: | --- | ---: | --- | --- |
| Hospitality revenue | ​ | $7,735 | ​ | $4,077 | ​ | $3,658 |  | 90% | ​ | ​ |
| Total revenues | ​ | 7,735 | ​ | 4,077 | ​ | 3,658 |  | 90% | ​ | ​ |
| Hospitality costs(b) | ​ | (20,428) | ​ | (7,815) | ​ | (12,613) |  | (161)% | ​ | ​ |
| Total operating expenses | ​ | (20,428) | ​ | (7,815) | ​ | (12,613) |  | (161)% | ​ | ​ |
| Other income, net | ​ | — | ​ | 2 | ​ | (2) |  | (100)% | ​ | ​ |
| Total expenses | ​ | (20,428) | ​ | (7,813) | ​ | (12,615) |  | (161)% | ​ | ​ |
| Equity in earnings (losses) from unconsolidated ventures | ​ | ​ 170 | ​ | ​ (10,211) | ​ | ​ 10,381 | ​ | 102% | ​ | ​ |
| Adjusted EBITDA | **​** | **$(12,523)** | **​** | **$(13,947)** | **​** | **$1,424** |  | **10%** | **​** | **​** |

(a) Period-over-period comparability is impacted by the consolidation of the Tin Building by Jean-Georges as of January 1, 2025. For prior periods in 2024, the Tin Building by Jean-Georges was an unconsolidated joint venture accounted for under the equity method in the Equity in earnings (losses) from unconsolidated ventures within our Hospitality segment.

(b) Hospitality costs include amounts related to intercompany leases that eliminate in the Statement of Operations.

Hospitality Adjusted EBITDA increased $1.4 million compared to the prior-year period primarily due to the following:

### Hospitality Revenue

Hospitality revenue increased $3.6 million to $7.7 million for the three months ended March 31, 2025, compared to $4.1 million in the prior-year period. This change was primarily due to a $4.5 million increase as a result of consolidating the Tin Building by Jean-Georges as of January 1, 2025, offset by decreased revenue across various restaurants within the Seaport as a result of reduced operating hours during the three months ended March 31, 2025.

### Hospitality Costs

Hospitality costs increased $12.6 million to $20.4 million for the three months ended March 31, 2025, compared to $7.8 million in the prior-year period. The increase is primarily due to the consolidation of the Tin Building by Jean-Georges as of January 1, 2025, partially offset by reduced expenses across various restaurants within the Seaport as a result of reduced operating hours during the three months ended March 31, 2025.

36

### Equity in Earnings (Losses) from Unconsolidated Ventures

Equity in earnings (losses) from unconsolidated ventures increased $10.4 million to $0.2 million for the three months ended March 31, 2025, compared to losses of $10.2 million in the prior-year period. This change was primarily due to a $9.6 million decrease in losses as a result of consolidating the Tin Building by Jean-Georges as of January 1, 2025, a $0.5 million increase in earnings from Jean-Georges Restaurants, and a $0.3 million increase in earnings for the Lawn Club.

#### Entertainment

#### Segment Adjusted EBITDA

The following table presents segment Adjusted EBITDA for Entertainment:

*in thousands except percentages*

| ​ Entertainment Adjusted EBITDA | ​ ​ ​ | ​ ​ Three Months Ended March 31, 2025 | ​ ​ | ​ ​ 2024 | ​ ​ ​ | ​ ​ Change $​% | ​ | ​ | ​ ​ ​ | ​ ​ ​ |
| --- | --- | ---: | --- | ---: | --- | ---: | --- | ---: | --- | --- |
| Entertainment revenue |  | $4,209 |  | $3,564 |  | $645 |  | 18% |  | ​ |
| Total revenues | ​ | 4,209 | ​ | 3,564 | ​ | 645 | ​ | 18% | ​ | ​ |
| Entertainment costs | ​ | (7,077) | ​ | (6,381) | ​ | (696) | ​ | (11)% | ​ | ​ |
| Total operating expenses | ​ | (7,077) | ​ | (6,381) | ​ | (696) | ​ | 11% | ​ | ​ |
| Other income, net | ​ | — | ​ | 2 | ​ | (2) | ​ | (100)% | ​ | ​ |
| Total expenses | ​ | (7,077) | ​ | (6,379) | ​ | (698) | ​ | (11)% | ​ | ​ |
| Adjusted EBITDA | **​** | **$(2,868)** | **​** | **$(2,815)** | **​** | **$(53)** | ​ | **(2)%** | **​** | ​ |

Entertainment Adjusted EBITDA decreased $0.1 million compared to the prior-year period primarily due to the following:

### Entertainment Revenue

Entertainment revenue increased $0.6 million to $4.2 million for the three months ended March 31, 2025, compared to $3.6 million in the prior-year period. This change was primarily due to a $0.4 million increase in Aviators ticket revenue and a $0.2 million increase in sponsorship revenue related to the concert series at the Seaport.

### Entertainment Costs

Entertainment costs increased $0.7 million to $7.1 million for the three months ended March 31, 2025, compared to $6.4 million in the prior-year period. This change was primarily due to a $0.5 million increase in breakdown and removal costs associated with the seasonal Winterland Skating concept at the Seaport as well as a $0.2 million increase in costs at the Las Vegas Ballpark, primarily due to higher cost of sales and labor costs as expected with additional games.

#### Landlord Operations

#### Segment Adjusted EBITDA

The following table presents segment Adjusted EBITDA for Landlord Operations:

*in thousands except percentages*

| ​ ​ Landlord Operations Adjusted EBITDA | ​ ​ ​ ​ | ​ ​ Three Months Ended March 31, 2025 | ​ | ​ ​ 2024 | ​ ​ | ​ ​ ​ ​ Change $% | ​ ​ ​ ​ | ​ ​ ​ |
| --- | --- | ---: | --- | ---: | --- | --- | ---: | --- |
| Rental revenue(a) | ​ | $8,464 | ​ | $8,084 | ​ | $380 | 5% | ​ |
| Other revenue | ​ | 336 | ​ | 333 | ​ | ​ 3 | 1% | ​ |
| Total revenues | ​ | 8,800 | ​ | 8,417 | ​ | ​ 383 | 5% | ​ |
| Operating costs | ​ | (8,079) | ​ | (8,563) | ​ | ​ 484 | 6% | ​ |
| Total operating expenses | ​ | (8,079) | ​ | (8,563) | ​ | ​ 484 | (6)% | ​ |
| Other income, net | ​ | — | ​ | 4 | ​ | ​ (4) | (100)% | ​ |
| Total expenses | ​ | (8,079) | ​ | (8,559) | ​ | ​ 480 | 6% | ​ |
| **Adjusted EBITDA** | **​** | **$721** | **​** | **$(142)** | **​** | **$863** | **608%** | **​** |

(a) Rental revenue includes amounts related to intercompany leases that eliminate in the Company’s Statement of Operations.

Landlord Operations Adjusted EBITDA increased $0.9 million compared to the prior-year period primarily due to the following:

### Rental Revenue

Rental revenue increased $0.4 million to $8.5 million for the three months ended March 31, 2025, compared to $8.1 million in the prior-year period. This change was primarily driven by an increase in rent escalation revenue as well as an increase in revenue generated by variable-rent leases.

### Operating Costs

Operating costs decreased $0.5 million to $8.1 million for the three months ended March 31, 2025, compared to $8.6 million in the prior year period. This change was primarily due to decreases in payroll and marketing costs period over period.

### Liquidity and Capital Resources

As of March 31, 2025 and December 31, 2024, our cash and cash equivalents were $129.9 million and $165.7 million, respectively. As of March 31, 2025 and December 31, 2024, our restricted cash was $2.1 million and $2.2 million, respectively. Prior to the Separation, we operated as a division within HHH’s consolidated structure, which used a centralized approach to cash management and financing of our operations. This arrangement is not reflective of the manner in which we would have financed our operations had we been a standalone, publicly traded company during the three months ended March 31, 2024 and during the full year ended December 31, 2024. Restricted cash is segregated in escrow accounts related to payment of principal and interest on the Company’s outstanding mortgages payable.

HHH’s third-party long-term debt and the related interest expense have not been allocated to us for any of the periods presented as we were not the legal obligor nor were we a guarantor of such debt. As of each of March 31, 2025 and December 31, 2024, we had third-party mortgages payable of $102.4 million related to our 250 Water Street development, a variable-rate mortgage which requires monthly installments of only interest, and the Las Vegas Ballpark, a fixed-rate mortgage which requires semi-annual installments of principal and interest. As of each of March 31, 2025 and December 31, 2024, the Company’s secured mortgage loans did not have any undrawn lender commitment available to be drawn for property development. In connection with the Separation, on July 31, 2024, the variable rate mortgage related to 250 Water Street was refinanced, with HHH paying down $53.7 million of the outstanding principal balance and SEG refinancing the remaining $61.3 million at an interest rate of SOFR plus a margin of 4.5% with a scheduled maturity date of July 1, 2029. On January 1, 2025, the mortgage loan on 250 Water Street was amended, increasing the stated margin rate from 5.0% to 7.0%. See Note 4 – *Mortgages Payable, Net* in the Unaudited Notes to the Consolidated and Combined Financial Statements included in this Quarterly Report for additional information.

Following the Separation, our capital structure and sources of liquidity have changed from our historical capital structure because HHH is no longer financing our operations, investments in joint ventures, and development and redevelopment projects. Our development and redevelopment opportunities are capital intensive and will require significant additional funding, if and when pursued. Our ability to fund our operating needs and development and redevelopment projects will depend on our future ability to continue to manage cash flow from operating activities, and on our ability to obtain debt or equity financing on acceptable terms. In addition, we typically must provide completion guarantees to lenders in connection with their financing for our development and redevelopment projects. Additionally, on July 31, 2024, a subsidiary of HHH that became our subsidiary in connection with the Separation, issued 10,000 shares of 14.000% Series A preferred stock, par value $0.01 per share, with an aggregate liquidation preference of $10.0 million.

Management believes that our existing cash balances and restricted cash balances, along with access to capital markets, provide (i) adequate liquidity to meet all of our current and long-term (beyond 12 months) obligations when due, including our third-party mortgages payable, and (ii) adequate liquidity to fund capital expenditures and development and redevelopment projects. However, our access to, and the availability of, financing on acceptable terms and conditions in the future will be impacted by many factors, including (1) our credit ratings, including the lowering of any of our credit ratings, or the absence of a credit rating, (2) the liquidity of the overall capital markets, and (3) the current state of the economy and, accordingly, there can be no assurances that we will be able to obtain additional debt or equity financing on acceptable terms in the future, or at all, which could have a negative impact on our liquidity and capital resources. The cash flows presented in our Unaudited Consolidated and Combined Statement of Cash Flows for the three months ended March 31, 2024 may not be indicative of the cash flows we would have recognized had we operated as a standalone publicly traded company for the period presented.

### Cash Flows

The following table sets forth a summary of our cash flows:

*in thousands*

| ​ ​ | ​ ​ | ​ ​ Three Months Ended March 31, 2025 | ​ ​ | ​ ​ 2024 | ​ ​ |
| --- | --- | ---: | --- | ---: | --- |
| Cash used in operating activities |  | $(20,478) | ​ | $(18,796) |  |
| Cash used in investing activities | ​ | (14,497) | ​ | (28,578) | ​ |
| Cash (used in) provided by financing activities | ​ | ​ (870) | ​ | ​ 47,659 | ​ |

### Operating Activities

Cash used in operating activities increased $1.7 million to $20.5 million in the three months ended March 31, 2025, compared to $18.8 million in the prior-year period. The increase primarily relates to changes in cash used in operating activities in each of our segments and increases in short-term receivables with our unconsolidated joint ventures.

### Investing Activities

Cash used in investing activities decreased $14.1 million to $14.5 million in the three months ended March 31, 2025, compared to $28.6 million in the prior-year period. The decrease in cash used in investing activities was primarily related to the consolidation of the Tin Building by Jean-Georges joint venture.

### Financing Activities

Cash provided by financing activities decreased $48.5 million to cash used in financing activities of $0.9 million in the three months ended March 31, 2025, compared to cash provided by financing activities of $47.7 million in the prior- year period, primarily due to the elimination of net transfers provided by HHH to fund the operating and investing activities described above.

### Contractual Obligations

We have material contractual obligations that arise in the normal course of business. Contractual obligations entered into prior to the Separation may not be representative of our contractual obligations profile as a standalone, publicly traded company. Our pre-Separation contractual obligations do not reflect changes that we expect to experience in the future as a result of the Separation, such as contractual arrangements that we may enter into in the future that were historically entered into by HHH for shared services.

We have outstanding mortgages payable related to the 250 Water Street development and Las Vegas Ballpark, which are collateralized by certain of the Company’s real estate assets. A summary of our mortgages payable as of March 31, 2025 and December 31, 2024 can be found in Note 4 – *Mortgages Payable, Net* in the Unaudited Notes to the Consolidated and Combined Financial Statements included in this Quarterly Report.

We lease land or buildings at certain properties from third parties. Rental payments are expensed as incurred and have been, to the extent applicable, straight-lined over the term of the lease. Contractual rental expense was $1.6 million and $2.1 million for the three months ended March 31, 2025 and 2024, respectively. The amortization of straight-line rents included in the contractual rent amount was $0.6 million for each of the three months ended March 31, 2025 and 2024. A summary of our lease obligations as of March 31, 2025 and December 31, 2024, can be found in Note 9 – *Leases* in the Unaudited Notes to the Consolidated and Combined Financial Statements included in this Quarterly Report.

### Critical Accounting Estimates

The preparation of financial statements in accordance with GAAP requires management to make informed judgments, assumptions and estimates that affect the reported amounts of assets, liabilities, revenues, and expenses. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Changes in facts and circumstances or additional information may result in revised estimates, and actual results may differ from these estimates.

There have been no material changes to our Critical Accounting Estimates as described within “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K Filed with the SEC on March 10, 2025.

### Impairments

#### Methodology

We review our long-lived assets for potential impairment indicators whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Although the carrying amount may exceed the estimated fair value of certain properties, a real estate asset is only considered to be impaired when its carrying amount is not expected to be recovered through estimated future undiscounted cash flows. To the extent an impairment provision is necessary, the excess of the carrying amount of the asset over its estimated fair value is expensed to operations and the carrying amount of the asset is reduced. The adjusted carrying amount, which represents the new cost basis of the asset, is depreciated over the remaining useful life of the asset.

#### Judgments and Uncertainties

An impairment loss is recognized if the carrying amount of an asset is not recoverable and exceeds its fair value. The cash flow estimates used both for determining recoverability and estimating fair value are inherently judgmental and reflect current and projected trends in rental, occupancy, pricing, development costs, sales pace and capitalization rates, selling costs, and estimated holding periods for the applicable assets. As such, the evaluation of anticipated cash flows is highly subjective and is based in part on assumptions that could differ materially from actual results in future periods. Unfavorable changes in any of the primary assumptions could result in a reduction of anticipated future cash flows and could indicate property impairment. Uncertainties related to the primary assumptions could affect the timing of an impairment. While we believe our assumptions are reasonable, changes in these assumptions may have a material impact on our financial results.

### Variable Interest Entities

#### Methodology

Our Unaudited Consolidated and Combined Financial Statements include all of our accounts, including our majority owned and controlled subsidiaries and variable interest entities (“VIEs”) for which we are the primary beneficiary. If the Company determined it was not the primary beneficiary of a VIE during the three months ended March 31, 2025 and March 31, 2024, the Company did not consolidate the VIE in which it holds a variable interest.

#### Judgments and Uncertainties

The Company determines whether it is the primary beneficiary of a VIE upon initial involvement with a VIE and reassesses whether it is the primary beneficiary of a VIE on an ongoing basis. The determination of whether an entity is a VIE and whether the Company is the primary beneficiary of a VIE is based upon facts and circumstances for the VIE and requires significant judgments such as whether the entity is a VIE, whether the Company’s interest in a VIE is a variable interest, the determination of the activities that most significantly impact the economic performance of the entity, whether the Company controls those activities, and whether the Company has the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could be significant to the VIE.

The Tin Building by Jean-Georges was previously classified as a VIE. As of January 1, 2025, in conjunction with the internalization of food and beverage operations, the Company, through employing the management team personnel and directing the operating activities that most significantly impact the economic performance of the Tin Building by Jean-Georges, became the primary beneficiary of the VIE and consolidated the VIE on January 1, 2025 and for the three month period ending March 31, 2025. See Note 2 – *Investments in Unconsolidated Ventures* for additional information.

### Investments in Unconsolidated Ventures

#### Methodology

The Company’s investments in unconsolidated ventures are accounted for under the equity method to the extent that, based on contractual rights associated with the investments, the Company can exert significant influence over a venture’s operations. Under the equity method, the Company’s investment in the venture is recorded at cost and is subsequently adjusted to recognize the Company’s allocable share of the earnings or losses of the venture. Dividends and distributions received by the business are recognized as a reduction in the carrying amount of the investment.

The Company evaluates its equity method investments for significance in accordance with Regulation S-X, Rule 3-09 and Regulation S-X, Rule 4-08(g) and presents separate annual financial statements or summarized financial information, respectively, as required by those rules.

For investments in ventures where the Company has virtually no influence over operations and the investments do not have a readily determinable fair value, the business has elected the measurement alternative to carry the securities at cost less impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or similar investment of the issuer.

#### Judgments and Uncertainties

Generally, joint venture operating agreements provide that assets, liabilities, funding obligations, profits and losses, and cash flows are shared in accordance with ownership percentages. For certain equity method investments, various provisions in the joint venture operating agreements regarding distributions of cash flow based on capital account balances, allocations of profits and losses and preferred returns may result in the Company’s economic interest differing from its stated ownership or if applicable, the Company’s final profit-sharing interest after receipt of any preferred returns based on the venture’s distribution priorities. For these investments, the Company recognizes income or loss based on the joint venture’s distribution priorities, which could fluctuate over time and may be different from its stated ownership or final profit-sharing percentage.

### Capitalization of Development Costs

#### Methodology

Development costs, which primarily include direct costs related to placing the asset in service associated with specific development properties, are capitalized as part of the property being developed. Construction and improvement costs incurred in connection with the development of new properties, or the redevelopment of existing properties are capitalized before they are placed into service. Costs include planning, engineering, design, direct material, labor and subcontract costs. Real estate taxes, utilities, direct legal and professional fees related to the sale of a specific unit, interest, insurance costs and certain employee costs incurred during construction periods are also capitalized. Capitalization commences when the development activities begin and cease when a project is completed, put on hold or at the date that the Company decides not to move forward with a project. Capitalized costs related to a project where the Company has determined not to move forward are expensed if they are not deemed recoverable. Capitalized interest costs are based on qualified expenditures and interest rates in place during the construction period. Demolition costs associated with redevelopments are expensed as incurred unless the demolition was included in the Company’s development plans and imminent as of the acquisition date of an asset. Once the assets are placed into service, they are depreciated in accordance with the Company’s policy. In the event that management no longer has the ability or intent to complete a development, the costs previously capitalized are evaluated for impairment.

#### Judgments and Uncertainties

The capitalization of development costs requires judgment, and can directly and materially impact our results of operations because, for example, (i) if we do not capitalize costs that should be capitalized, then our operating expenses would be overstated during the development period, and the subsequent depreciation of the developed real estate would be understated, or (ii) if we capitalize costs that should not be capitalized, then our operating expenses would be understated during the development period, and the subsequent depreciation of the real estate would be overstated. For the three months ended March 31, 2025 and 2024, we capitalized development costs of $2.3 million and $2.4 million, respectively.

## Market risk

As filed, 1,183 characters.

### Interest Rate Risk

We are subject to interest rate risk with respect to our variable-rate mortgage payable as increases in interest rates would cause our payments to increase. With respect to our fixed-rate mortgage payable, increases in interest rates could make it more difficult to refinance such debt when it becomes due.

Based on our variable rate debt balance, interest expense would have increased by approximately $0.2 million for the three months ended March 31, 2025 if short-term interest rates had been 1% higher. As of March 31, 2025, the weighted average interest rate on the $41.1 million of fixed-rate indebtedness outstanding was 4.92% per annum, with principal paydowns at various dates through December 15, 2038.

For additional information concerning our debt and management’s estimation process to arrive at a fair value of our debt as required by GAAP, please refer to the Liquidity and Capital Resources section above in Management's Discussion and Analysis of Financial Condition and Results of Operations and Note 4 – *Mortgages Payable, Net* in the Unaudited Notes to the Consolidated and Combined Financial Statements included in this Quarterly Report.

## Controls and procedures

As filed, 2,141 characters.

### Evaluation of Disclosure Controls and Procedures

The Company maintains a set of disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are designed to ensure that information required to be disclosed in the Company’s reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that this information is accumulated and communicated to the Company’s management, including the Company’s principal executive officer and the principal financial officer, as appropriate, to allow for timely decisions regarding required disclosure.

As required by Exchange Act Rule 13a-15(b), the Company carried out an evaluation, under the supervision and with the participation of management, including the Company’s principal executive officer and principal financial officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures as of the end of the period covered by this Quarterly Report. Based on this evaluation, the Company’s principal executive officer and principal financial officer concluded that the Company’s disclosure controls and procedures, as of the end of the period covered by this Quarterly Report, were effective to provide reasonable assurance that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms and is accumulated and communicated to the Company’s management, including the principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

### Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting during the quarter ended March 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

## Risk factors

As filed, 703 characters.

There were no material changes to the risk factors set forth in the section titled “Item 1A. Risk Factors” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024. You should carefully read and consider the risks and uncertainties described in such Annual Report, together with all of the other information included in this Quarterly Report, including the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Cautionary Statement Regarding Forward-Looking Statements” and our Unaudited Consolidated and Combined Financial Statements and related Notes, as well as other documents that we file with the SEC from time to time.

Filed May 12, 2025.
Source: SEC EDGAR, the filing index for accession 0001558370-25-007409. Last ingested by Listed: Oct 24, 2026, 15:06 ET. No prices; not investment advice.