Seaport Entertainment Group Inc.

Greetings and welcome to the Seaport Entertainment Group fourth quarter and full year 2025 earnings call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance, please press star zero on your telephone keypad as a reminder this conference is being recorded. It is now my pleasure to introduce Jason Wilkes, Senior Vice President of Finance. Please go ahead.

Thank you, Operator, and good morning, everyone. With me today is our President and Chief Executive Officer, Matt Partridge, and our Chief Financial Officer, Lena Eliwot. Before we begin, I'd like to remind everyone that many of our comments today are considered forward-looking statements under federal securities law. The company's actual future results may differ significantly from the matters discussed in these forward-looking statements. and we undertake no duty to update these statements. Factors and risks that could cause actual results to differ materially from expectations are disclosed from time to time in greater detail in the company's Form 10-K, Form 10-Q, and other SEC filings. You can find our SEC reports, earnings release, and quarterly supplemental information on our website at seaportentertainment.com. With that, I will now turn the call over to Matt.

Thanks, Jason, and good morning, everyone. As we outlined during our inaugural earnings call last March, our focus in the first full year as a standalone public company was to address multiple opportunities for improvement, including outsized priorities within the seaport, as we worked to position the organization as a scalable, real estate-centric hospitality and entertainment company. Looking back and taking stock of our accomplishments, we made tremendous progress in 2025 and year-to-date 2026, addressing these opportunities. Some of our more notable achievements in 2025 include generating a 24% year-over-year improvement in our net loss and a 49% year-over-year improvement in our non-GAAP adjusted net loss. Leasing, programming, and finalizing development plans for approximately 153,000 square feet across the seaport, including signing agreements with Meow Wolf, Flanker Kitchen and Sports Bar, Hidden Boots Saloon, Willits NYC, Cork Wine Bar, and other exciting additions that I'll discuss shortly. Internalizing food and beverage operations across many of our company's wholly-owned, enjoyed venture-owned restaurants in the Seaport neighborhood. The Las Vegas Aviators winning the 2025 Pacific Coast League Championship, the franchise's first PCL title since 1988, and hosting and competing in the Minor League Baseball AAA National Championship game. Further establishing the seaport as a premier event destination by hosting multiple rooftop and neighborhood-wide marquee events, including more than 60 concerts, the Macy's Fourth of July Fireworks, and the New York City Wine and Food Festival, and putting 250 Water Street under contract to sell, which subsequently closed last month in early February. The process of finalizing the sale of 250 Water Street was longer than anticipated, and after completing additional diligence and evaluating market conditions, we believe this transaction represented the best risk-adjusted outcome for the company. The transaction will generate net proceeds of approximately $75 million after we work through some post-closing obligations, which should largely be resolved in Q3 2026. With the sale complete, we've eliminated $7 million of annual cash burn related to interest expense and carry costs, We now have additional capital on our balance sheet and a clearer runway to execute against our strategic priorities. In addition to the 250 Water Street sale, the other significant announcement in early 2026 was the closure of the Tin Building in its current form as a culinary experience. We are very appreciative of Chef Jean-Georges, his team, and the Tin Building staff for their partnership, dedication, and effort. The Tin Building was an ambitious undertaking, and Chef Jean-Georges created a truly beautiful and distinct destination. Our partnership with Chef and its team remains strong, and we look forward to continuing to work with them both at the Seaport and more broadly as a 25% owner in John George restaurants. Given the historical challenges of the TIN building, we conducted a comprehensive assessment of the operating model and evaluated a range of alternatives. In the end, we concluded that the asset required a fundamental repositioning of both its use and operating structure to achieve long-term sustainability. As a result, we signed a new lease with Lux Entertainment to bring their highly successful Balloon Museum experience to the 10 building, which will serve as their flagship U.S. location. For those of you who are less familiar with the concept, the Balloon Museum is an award-winning, large-format, interactive contemporary art experience. To date, the Balloon Museum exhibitions have toured through 23 major cities across Europe, North America, and Asia, often within historic and landmark buildings and with works from internationally recognized artists. They welcome more than 7 million visitors globally, and when set alongside Meow Wolf, the rooftop at Pier 17 concerts, existing and new restaurant offerings, our recently announced expanded event space, and other retail, cultural, and event-driven initiatives, the Blue Museum further complements the growing set of experiences within the seaport that we believe will drive broad-based visitation by local residents, New Yorkers, and tourists alike. Under our agreement with Lux Entertainment, the initial lease term is five years with two five-year extension options. The base rent includes annual contractual escalations and a percentage rent component above a contractually established revenue threshold. From a capital standpoint, work is underway at an estimated cost of approximately $5 million, with delivery to the tenant expected by the end of Q2 2026. Lux Entertainment will complete its interior, fit out at its own expense, and they anticipate opening this summer. Strategically, this agreement fundamentally changes the financial profile of the TIN building, transitioning it from a negative cash-burning operation to a stabilized, positive free cash-flowing asset that further complements the broader programming of the neighborhood. When compared to the financial performance of the TIN building in 2025, the Bluen Museum lease has the opportunity to improve the company's pro forma annual EBITDA by more than $22 million. This progress has positioned us for long-term financial stability something this collection of assets has not experienced in recent history. In terms of our go-forward focus, we have some very exciting things on the horizon. During the fourth quarter, we signed a 10-year agreement with a renowned Brooklyn-based arts, culture, and hospitality concept to occupy approximately 11,000 square feet in the historic cobblestones. We plan to announce our partner and the name of the project in the coming months, and we believe this new concept, which is centered around a multifaceted, evolving hospitality and music experiences, Further expands on the diversified programming we are curating throughout the Seaport neighborhood. Additionally, we will open a new 400-seat, 1,000-person open container district that will be anchored by a new restaurant called Sadie's. Sadie's will occupy the first and second floors of a previously vacant restaurant space located at 19 Fulton Street and will include the outdoor garden bar that sits at the center of the historic pedestrian-only cobblestones. The restaurant and bar will feature new American food at an accessible price point, filling a need for a larger format communal and approachable restaurant within the seaport. Sadie's will also have a robust programming calendar featuring celebrations for seasonal, sporting, and cultural moments, including events centered around music-driven activations, the Kentucky Derby, People World Cup, U.S. Open, America 250, Oktoberfest, and other evergreen programming. And finally, in January, we made the difficult decision to close the Malibu farm location of Pier 17. We've had preliminary discussions regarding several replacement concepts that we believe could be additive to our overall plan for the seaport, including replacing some of the culinary gaps that have been created with the closing of the tent building. Beyond the incoming entertainment and food and beverage opportunities, we intend to expand the previously announced Pier 17 event space from 17,500 square feet to more than 40,000 square feet across three floors with a focus on premium corporate, not-for-profit, convention, and social events. This will create one of the largest multifaceted event spaces in New York City, featuring iconic expansive views of the East River, Brooklyn Bridge, and Manhattan and Brooklyn skylines. All levels will be accessible via dedicated ground floor, elevator entrance, and staircases with connectivity to the rooftop of Pier 17. The event space will also leverage Pier 17's other unique attributes, including proximity to major transportation hubs, an access control driveway, and adjacency to a dense mix of entertainment and dining options. Furthermore, the expanded event space at Pier 17 provides several strategic benefits to the company, including further positioning the seaport as a destination for large-scale meetings and events through integrated partnerships with third-party planners and caterers, creating a compelling weather contingency option that improves the rooftop's utilization for non-concert events, diversifying our revenue sources with incremental weekday and off-peak demand, leveraging our existing infrastructure and capabilities, which were on display during our campus-wide activations during the New York City Wine and Food Festival and Macy's 4th of July fireworks, and improving utilization of space that was previously positioned for office use. While we're still finalizing some of the details for this project, including timing, We currently expect this initiative to generate long-term, unlevered cash-on-cash returns above 20% with an estimated payback period under five years. We will provide more information about the event space on our first quarter earnings call. At the rooftop at Pier 17, which was recently named by the 2026 Rolling Stone Audio Awards as the best outdoor music venue in the United States, our team is ramping up for the 2026 Seaport Concert Series, which begins May 2nd. This year builds on a strong 2025 season that delivered our highest ever total attendance and all-time highs in customer experience and staff friendliness scores. From a revenue optimization standpoint, we are focused on expanding premium upsell offerings at the Liberty Club and Patron Patio. These initiatives are designed to drive incremental high-margin revenue while enhancing the overall guest experience through more customized and differentiated hospitality offerings. Taking a step back and looking at the Seaport overall, as of December 31st, The seaport neighborhood was approximately 90% leased or programmed, leaving roughly 47,000 square feet of vacancy. For pro forma for the Malibu farm closure, this number is closer to 53,000 square feet. For the remaining vacancy, we are predominantly focused on complimentary daily needs and amenity-oriented tenants and incremental food and beverage opportunities where we have existing restaurant infrastructure. Since we became a standalone public company in August 2024, we have leased or programmed more than 220,000 square feet, which we anticipate will result in additional stabilized EBITDA of more than $30 million. Lastly, before we shift to Las Vegas, I do want to highlight that we are continuing to explore the sale of our 21-unit apartment building at 85 South Street. We'll provide further updates on that transaction if or when it is completed. Moving west, the team in Las Vegas is transitioning from the winter activation Enchant back to regular season baseball programming. During the fourth quarter, we internalized the day-to-day operations of Enchant to strengthen our customer engagement and introduce new audiences to the ballpark. This process resulted in some transitional costs, but overall better positions us for improved execution and profitability in 2026. In terms of early demand for the baseball season, group and season ticket sales are pacing ahead of last year, including strong momentum for big league weekend when the Athletics face the Angels on March 7th and 8th, followed by opening day for the Las Vegas Aviators on March 27th. Additionally, after last year's hiatus, the Las Vegas Ballpark will once again host the Savannah Bananas for three games starting April 30th, with ticket sales currently outpacing 2024 levels. Overall, we're excited about the support for the team and how it's materializing in ticket sales, and from an operating standpoint, we expect incremental efficiencies in 2026 as we apply the learnings from Enchant and better control certain variable expenses. As a result, we expect continued margin improvement in 2026 across the entire Las Vegas operation. At the corporate level, we recently received board approval to file a $150 million shelf registration statement and a $50 million stock repurchase program. The shelf gives us flexibility and allows us to access the capital markets efficiently in the future if a strategic opportunity makes sense. At the same time, with a strong balance sheet and our recent momentum, maintaining optionality to buy back stock could be a good long-term capital allocation decision. Both programs are tools for us as a public company that provide the ability to be opportunistic, but neither should be interpreted as an immediate plan to issue or repurchase securities. Finally, before I turn it over to Lena, I want to sincerely thank our team for their resilience, hard work, and compassion. Their support of the company and fellow team members, especially through these transitional moments, has been tremendous. I'm proud of the progress we've made. I'm confident we'll continue building on the strong momentum we saw through a year in 2025 and into 2026. With that, I'll now turn the call over to Lena.

Thanks, Matt. Before I get into the company's fourth quarter and full year financial performance, I'd like to remind everyone of some changes made at the start of 2025, including renaming our sponsorship events and entertainment segment to entertainment. In conjunction with this change, we reallocated sponsorship and events revenues and expenses to the respective segments that most appropriately reflect the source of the sponsorship or event. These changes are reflected in both the current and prior year periods presented on our consolidated and combined statements of operations. Beginning in 2025 and in conjunction with the internalization of our food and beverage operations, we consolidated the TIN building into our hospitality segment. In prior years, the TIN building was accounted for as an unconsolidated joint venture, and our share of net loss was reflected in the equity and earnings or losses from unconsolidated ventures line on our consolidated and combined statements of operations. In an effort to provide more comparable information, we'll refer to the 2024 operating results on a pro forma basis, reflecting the inclusion of the TIN building as a consolidated entity during the prior year period when providing year-over-year comparisons on this call. In addition, we'll reference operating EBITDA, which excludes losses on assets held for sale, impairment charges, and other non-recurring items included in other income or losses related to the segment or on a consolidated basis to provide more comparable operating results. Fourth quarter and full year 2025 net loss attributable to common stockholders was $36.9 million, and 116.7 million, respectively, representing a year-over-year improvement of 11% for Q4 2025 and 24% for the full year 2025. On a per-share basis, net loss attributable to common stockholders was $2.89 in Q4 of 2025 and $9.18 for the full year of 2025, representing a 20% and 45% improvement, respectively. Non-GAAP adjusted net loss attributable to common stockholders was $17.5 million for the fourth quarter of 2025 and $54.1 million for the full year, representing improvements of 9% and 49%, respectively, compared to the same periods in 2024. On a per-share basis, non-GAAP adjusted net loss was $1.37 for the fourth quarter of 2025 and $4.26 for the full year of 2025, representing a year-over-year improvement of 18% and 64% respectively. In the fourth quarter of 2025, total consolidated revenues were $29.5 million, a 7% year-over-year increase when compared to pro forma Q4 of 2024. For the full year 2025, total consolidated revenues were $130.4 million, which is essentially flat to full year 2024 consolidated revenue on a pro forma basis. As a reminder, consolidated revenues exclude the financial results of our unconsolidated ventures, such as the Lawn Club and our investment in John George Restaurants, since they are reflected in the equity in earnings or losses from unconsolidated ventures line on our consolidated and combined statements of operations. In hospitality, fourth quarter revenues declined 23% on a pro forma basis. primarily driven by lower performance at the Tin Building and unfavorable year-over-year comparisons, resulting from events and activations in Q4 2024 that did not repeat in 2025. One of those activations was a holiday-themed partnership on the rooftop at Pier 17 with the Dead Rabbit, a world-renowned Irish cocktail bar in Lower Manhattan, and another was a large-scale private event across multiple venues at Pier 17. Total food and beverage revenues within the hospitality segment, inclusive of lawn clubs, declined 15% year-over-year. On a same-store basis, food and beverage revenue declined 20%, with the most meaningful difference relating to Gitano, which was not included in the same-store revenues in the fourth quarter due to it being under construction during Q4 of 2024. In the fourth quarter of 2025, hospitality consolidated adjusted EBITDA, including earnings from unconsolidated ventures, improved by $11 million year-over-year on a pro forma basis, mainly as a result of the $10 million impairment charge recognized in the prior year relating to warrants of John George restaurants, which were nearing expiration. Excluding this impairment and other items included in other income and loss, hospitality operating EBITDA improved by 17% year-over-year on a pro forma basis, driven by better flow-through at the Tin Building, continued growth at the Lawn Club in Gitano, which continues to drive increased revenue as they refine their operations, as well as the cost savings realized from the internalization of food and beverage operations earlier in 2025. During the full year 2025, hospitality revenue declined by 16% on a pro forma basis. The decline was primarily driven by overall performance of the TIN building, reflecting both the closure of certain venues within the building and increasing top-line softness. as well as declines from certain legacy standalone restaurants. This was partially offset by the continued growth of Gitano and the incremental revenue generated from larger events, such as the Macy's 4th of July fireworks event. Total 2025 food and beverage revenue, including Lawn Club, declined 8% year over year. On a same-store basis, food and beverage revenue declined 5%. This more moderate decline reflects the exclusion of the non-repeating dead rabbit holiday activation and closure of some of the TIN building outlets in 2025. For the full year 2025, hospitality consolidated adjusted EBITDA increased $10.5 million year-over-year on a pro forma basis, mainly reflective of the $10 million John George warrant impairment recorded in 2024. Excluding other income and losses, which was primarily impacted by a one-time favorable hospitality expense reimbursement in 2024, along with excluding the 2024 warrant impairment charge, hospitality operating EBITDA increased 25% year-over-year. The improvement was predominantly driven by the internalization of food and beverage operations, disciplined cost-cutting controls at the TIN building, more measured marketing spend across the portfolio, and continued strong performance at the Lawn Club in Gitano. Turning to the entertainment segment, fourth quarter revenues increased 68% year over year, primarily driven by the internalization of Enchant operations in Las Vegas. Partially offsetting this initiative was the timing of Las Vegas Aviator sponsorship revenue, the absence of the seasonal holiday activations on the rooftop at Pier 17 in 2025, and two fewer concerts in New York during the prior year's comparable quarter. Despite hosting fewer shows during the period, concert series food and beverage revenue increased 3% year-over-year, driven by increased per-show attendance and higher per-customer spend. With the concert and baseball season ending in October, Q4 2025 entertainment operating EBITDA increased 18% year-over-year, mainly from better flow through achieved by foregoing the seasonal holiday activation on the rooftop at Pier 17, but partially offset by the lower concert count compared to Q4 of 2024. Total 2025 year-over-year entertainment revenues increased 14% due to the internalization of Enchant operations in Las Vegas, increased sponsorship revenue in both New York and Las Vegas, and new revenue from previously referenced larger format events. On a full-year basis, adjusted EBITDA for the entertainment segment increased by 124% when compared to the prior year, benefiting from improved collections and reduced bad debt, as well as better flow-through by foregoing the seasonal holiday activation on the rooftop at Pier 17. Our concert business also benefited from the internalization of food and beverage operations, as well as strategic reductions in per-show operating expenses. Within the landlord segment, fourth quarter rental revenue increased 14% year over year on a pro forma basis. This is mainly from the growth of our private events rental revenue with large scale events such as New York City Wine and Food Festival contributing to the current quarter improvements. These gains are partially offset by the termination of the ESPN lease in Q3 of 2025, resulting in the loss of year over year comparable rental revenue in Q4 of 2025. Landlord consolidated adjusted EBITDA declined by $10.1 million on a pro forma basis, primarily driven by a $7 million write-down of 250 Water Street to its final sales price. It was further impacted by the non-repeating $2 million legal settlement proceeds recognized in Q4 of 24. Excluding these non-recurring items, landlord operating EBITDA declined 37% year-over-year on a pro forma basis, as expenses increased relating to the timing of accruals for operating expenses, such as cleaning, security, and utilities, along with the effects of the non-repeating rent reserves placed in Q4 of 24. For the full year of 2025, rental revenue increased 21% year-over-year on a pro forma basis, driving most of the landlord's 18% year-over-year revenue growth. Increases to rental revenue were driven by private event rental activity most notably Jordan Brand's The One Tournament Global Finals event and the New York City Wine and Food Festival, as well as termination-related income associated with our Nike office lease and a decrease in rent reserves compared to prior year. As a reminder, Nike exercised their termination option within their lease but remains a tenant of Pier 17 through February of 2027. The landlord segment's 2025 consolidated adjusted EBITDA declined 55% year-over-year on a pro forma basis, primarily due to $13.4 million of one-time non-recurring charges. These include an $11 million loss on the write-down of 250 Water Street in conjunction with its classification as held for sale and a $2 million write-off of capital spent on the rooftop winter structure. Excluding these non-recurring items, the landlord segment operating EBITDA for the full year increased 36% year-over-year on a pro forma basis. The improvement reflects the previously mentioned revenue growth reduced overhead compared to the pre-spend structure in prior year, and improved operating expense savings year-over-year. Overall, consolidated segment adjusted EBITDA for the fourth quarter of 2025, which reflects segment performance before G&A interest depreciation amortization and includes results from unconsolidated ventures, improved by 1.3 million year-over-year on a pro forma basis. Including the non-recurring items discussed earlier, such as the loss on 250 Water Street, the prior year warrant impairment, and the favorable legal settlement recognized in the prior year, consolidated operating EBITDA increased 5% year-over-year on a pro forma basis in the fourth quarter. For the full year 2025, consolidated segment-adjusted EBITDA improved by $2.8 million on a pro forma basis. Excluding the non-recurring items, the 250 Water Street held-for-sale loss, the rooftop winter structure write-offs, the prior year warrant impairment, the favorable hospitality expense reimbursement and legal settlement recorded in the prior year, consolidated operating EBITDA increased 33% or more than $13 million year-over-year on a pro forma basis. Overall, with total year-over-year revenue relatively stable, this bottom line improvement was driven by reduced costs as our operating structure stabilizes in our first full year as a standalone public company as well as overall cost optimization initiatives we've implemented across each segment in 2025. During Q4 2025, we incurred general and administrative expenses of $6.8 million, an improvement of 31% when compared to the fourth quarter of prior year. For the full year 2025, G&A expenses were $42.8 million, representing a 32% improvement compared to 2024. Prior year GNA was higher overall due to our predecessor's cost structure and transitional expenses related to our separation from Howard Hughes. While there were significant GNA improvements achieved in 2025 through streamlining and optimizing operations, they were partially offset by $12 million in expenses related to our leadership transition. As we continue to stabilize our operating model, we expect to continue to improve upon our cost structure with Q4 2024 as our new benchmark. During the fourth quarter of 2025, interest expense increased by 3.3 million compared to the comparable prior year quarter, primarily due to interest expense capitalized on 250 Water Street in Q4 of 24 that did not recur in the current period, and a decrease in interest earned on invested cash. As a reminder, we suspended interest capitalization on 250 Water Street midway through Q3 once the asset was classified as held for sale, resulting in higher reported interest expense in the second half of 2025. For the full year, net interest income totaled just under half a million compared to net interest expense of $6.8 million in the prior year, a $7.2 million year-over-year improvement driven by higher interest income on invested cash, increased interest capitalization earlier in the year prior to the held-for-sale classification of 250 Water Street, and lower amortization of financing costs following our separation. Compared to Q4 of 2024, equity in earnings or losses from unconsolidated ventures improved by $9.7 million year-over-year on a pro forma basis, and for the full year, improved $11.5 million year-over-year on a pro forma basis. This is mainly a result of the $10 million impairment of the warrants previously described in Q4 of 2024. Excluding the warrant impairment, equity and earnings or losses from unconsolidated ventures declined approximately 0.3 million in the fourth quarter year over year on a pro forma basis and increased 169% or 1.5 million on a pro forma basis for the full year. This is reflected of continued strength at the Lawn Club as it scaled through its second full year of operations. Capital expenditures in the fourth quarter of 2025 totaled 2.8 million. For the full year, capital expenditures totaled $30.8 million. Excluding capitalized costs associated with 250 Water Street development, the majority of spending was related to Meow Wolf landlord work, the rooftop winter structure, the completion of Gitano and River Deck bar build-outs, as well as other landlord work and maintenance capital costs across our existing operations. Long-term debt outstanding as of year-end was reduced to $100.4 million reflecting a million-dollar decrease primarily related to the scheduled principal amortization on the Las Vegas ballpark loan. Net debt to gross sales at year-end was approximately 2%. Subsequent to year-end and in conjunction with the sale of 250 Water Street, we paid off the $61.3 million variable rate loan associated with the property, further strengthening our balance sheet. Our year-end 2025 cash-restricted cash and cash equivalents balance was just over $87 million. and pro forma to reflect the proceeds from the sale of 250 Water Street, our cash restricted cash and cash equivalents balance would be 163 million. As we move through 2026, our cash position provides meaningful liquidity and optionality for the company as we explore various investment and capital application opportunities for the long-term benefit of the organization and our shareholders. With the progress made, we've materially improved the company's financial performance strengthened the company's balance sheet, and laid the groundwork for sustainable long-term growth and value creation. With that, we'll now open the line for questions.

Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two to remove yourself from the queue. for participants using speaker equipment. It may be necessary to pick up your handset before pressing the start key. First question comes from Matthew Edner with Jones Trading. Please go ahead.

Hey, good morning, guys. Thanks for taking the question, and congrats on all the progress so far. Lena, you just mentioned that you guys have $163 million cash pro forma. How much of that is committed to current projects and getting them online at the seaport? And then with whatever's remaining there, what are you guys kind of targeting there for deployment?

Hey, Matt. Good morning. So we spent about $30 million in 2025 in capital. With our expectation for everything we've announced plus the existing vacancy to get to stabilization is another, we expect around another 70 to 90 million. We had initially said at the onset a range of 100 to 125 to get to stabilization, so I believe we're still expecting to target something within that range.

Hey, Matt, in terms of capital allocation, You know, we're sort of at the front end of this. Obviously, we've been focused on the existing asset base. I think we're going to look at a lot of different things, right? We're evaluating or we're starting to evaluate opportunities in the hospitality, entertainment, and event spaces. Obviously, that's core to what we're doing at the Seaport and what we do out in Las Vegas at the ballpark. I think we could potentially look at other assets similar to the Seaport, We could look at companies that operate within those businesses that have scalable intellectual property and brand recognition. But we could also be opportunistic and utilize the buyback program that we announced from a capital allocation standpoint and effectively reinvest into the company depending on where the stock's trading. So we're going to be opportunistic, and I don't think we have any definitive path yet because we're sort of at the forefront of evaluating the opportunity set.

Got it. That makes sense, and that's helpful. And then, you know, you mentioned on the event space kind of that 20% return there. You know, are there any internal hurdles that you guys are looking to achieve, you know, as you guys deploy this cash?

I think it depends on the business. You know, obviously the hospitality space is notorious for relatively low margins. I think the events business is a much better margin-oriented business. I think where we see some opportunity potentially is to leverage the existing team. We've got a lot of talent in the building, and obviously they're doing a great job executing on what we have. So if we can find things that complement the existing skill set, that's going to improve the flow through of whatever we allocate capital to. So it's a moving target. I wouldn't say we have any hard and fast financial targets yet, but... You know, we're obviously focused on growing earnings as efficiently as possible with the best flow through possible.

Yeah, got it. And then, you know, as it relates to the remaining space at the seaport, you know, have you had any discussions there? And then, you know, I guess what additional growth do you think that can drive on top of the call at 33, 32 million of EBITDA that's been leased?

Yeah, so we've, like Lena said, or I think maybe I said in the prepared remarks, we've got a little over 50,000 square feet left. You know, I'd say a third of that is probably restaurant-oriented space, and it also includes the former Malibu farm space. So we'll be looking at some restaurant concepts that are complementary to all the stuff that we've announced and what still exists at the seaport. I think beyond that, We've got the Balloon Museum coming, we have Meow Wolf coming, we have the event space, and then we have the rooftop of Pier 17 Concert Series. That's a great set of anchors. And then the removal of the 10 building F&B. I think the amount of people that the anchors will drive will benefit all the businesses, and then pulling some of the food and beverage supply out with the closure of the 10 building and positioning it to Balloon Museum is going to help all the other F&B that we've either announced exists down here that we'll look to fill the existing vacancy with.

Got it. Got it. And then, you know, as it relates to kind of the special events, you know, you had the Wine and Food Festival last year. You know, do you have anything set up like that so far across the year? Or is it, you know, going to be event-driven stuff like you said around the World Cup? You know, people go to the bars and are acting as in the cobblestones and whatnot.

Yeah, I think Sadie's is definitely going to be a unique asset for us to program around. The Lawn Club has been very successful doing a lot of corporate event and social event related business. And so I think those two concepts with the open container district that we announced are going to give us a lot of flexibility. We're going to look at everything from doing concerts on the cobblestones or concerts out on the pier. Obviously, we do them up on the rooftop as well, I think. FIFA and the World Cup are going to be a unique event this year. It's also America's 250-year anniversary, so there'll be a lot of activity during the summer around that, especially with the Fourth of July fireworks. And then we're going to do a lot of programming around cultural events and sporting events, because I think, you know, whether it's watch parties, whether it's whether it's community-oriented events like what we have coming up at this weekend around Holy. We're going to do a lot of stuff down here, which I think will bring a lot of people down to the seaport. It'll give them an opportunity to experience everything we have down here, and it'll support the businesses that we've got down here.

Yeah, that's awesome. And then last one for me, and I'll step out. Lena, you touched on it a little bit about G&A, but is there anything that we should expect kind of as a run rate throughout the year?

We've definitely been trending positively throughout the year on GNA, stabilizing our organizational structure, working through technology initiatives. We hope to continue that trend into 2026. Right now, I think Q4 is our new reference point, and we're continuing to try and refine that. I would use Q4 as our reference point for right now.

Yeah, I think it'll be a little up and down, Matt. You know, Q1 is going to have some transitional costs related to the closures that we've announced plus some other changes to the team. And then I think that'll benefit us in the back half of the year. But it'll be a little up and down this year. But I think to Lena's point, Q4 is a good reference point moving forward, and hopefully we can improve upon it.

Got it. Awesome. Thank you, guys. Appreciate it, and look forward to the continued progress. Thanks, Matt.

Thanks, Matt. Next question, Patrick Betelhofer with Kahn Brothers Group.

Hey, good morning, and congrats on all the recent announcements.

Thanks, Patrick.

My question, or first one, is around the kind of criteria for the buyback. You have this great slide in the deck that shows that, you know, the stock It's trading at 50 cents of a dollar, probably less than that. Obviously, that's a great hurdle rate. And so a lot of companies use buybacks on weakness, but you could argue the stock has been all weakness. So I'm just curious what would cause you to pull the trigger on this buyback program? Kind of when would you ramp it up? And how do you think about allocating it given what an incredible return on investment you can earn by doing this buyback program, which we're very happy to see?

I appreciate the question. For the buyback program, we won't put out any public comments related to parameters or timing. We'll report after things are executed on, if and when we use it. Obviously, we think the stock is undervalued, especially given the slide that you're referencing in our supplemental report. but we're also cognizant that we're building an organization that can grow over time, and we have relatively limited float, so that's always a consideration when you're using buybacks. This is my fifth public company that I've been part of. We've had buyback programs at all but one of them, and we use them opportunistically, and I think opportunistic is the approach that we'll use, but that ultimately will be a board decision, and we'll continue to have those conversations with the board as we We look at the performance of the stock and our relative alternatives from a capital application perspective.

Got it. And then the new balloon museum, how do you view that as either complementing or competing with the Meow Wolf experience that's coming a year later? Just how do these two go together?

Great question. Great question. You know, I think the Balloon Museum is definitely complimentary. Both of those teams, the Meow Wolf team and the Balloon Museum, know each other and there's a lot of mutual respect for one another. We spoke with Meow Wolf before moving forward with the Balloon Museum and they were very supportive of it. So I think they're going to be complimentary to one another. They're both ticketed experiences. They both have done very well in other markets. The Balloon Museum was here in 2023 and did exceptionally well a little farther up the river on Pier 36. So I think activity breeds more activity, and having them both open down here really gives the local population, New Yorkers, visitors, everybody sort of a full-day opportunity to spend at the seaport. You can come down here for brunch. You can go to the balloon museum. You can have lunch. You can go to the seaport museum or do some shopping. stay for dinner and a concert, go out to some bars. So we're really trying to create a district that can support the local community, because we've got a growing residential population down here, but that can also be a destination for an entire day for a family, a couple, an individual, or anybody in between.

That's great. On this apartment building you're monetizing, or maybe monetizing, could you provide any more details around kind of is it fully leased? Is it cash flowing? Just anything you can share about what you might be able to achieve by monetizing that house.

Yeah, it is cash flowing. You know, there's a component of the units that are rent stabilized. It's almost 100% leased. I think we have one or two vacant units. It's got a lot of interest. There's obviously, we launched it at the end of 2025, the marketing process, knowing that it would be sort of a slow process to end the year and start the year, but the interest is definitely ramped up. So, you know, unlike 250 Water Street where we had some disclosure obligations related to the materiality of that sale, we'll probably speak more to 85 South Street if and when we sell it rather than providing more real-time updates just because it's providing real-time updates can sometimes put us at a competitive disadvantage when we're trying to work through a transaction.

Understood. Every bit helps. And then last one from us, just how do you think about Vegas versus New York? Obviously, you have a lot happening at the seaport, and you're kind of local there. How do the Vegas properties still fit into the company, given both the geographic remoteness of it and also just less news from there? Thanks a lot.

Yeah, I think, look, in Las Vegas we've got a phenomenal facility with the ballpark. You know, it's at the center of Howard Hughes' Summerlin community that they continue to add amenities to and grow the population around the ballpark. The Fan base of the aviators is largely a local population, so we'd love to see Howard Hughes continuing to invest in that project that ultimately will in Europe benefit to the baseball team. I think things like Enchant are where we can add a lot of value. Doing 40 days of holiday activation and bringing that in-house and ultimately over the long term being able to implement better cost controls and be a little bit more creative from a ticketing perspective because we've got a great ticketing team out there. Doing things like that on the off-season is only going to help the profitability of that overall operation out there. So I think we've got some room to create value. That being said, I think live sports is a great business. It's a business that has seen tremendous value appreciation over time. So if and when... If somebody has an interest in the team, we'll always listen, but I think we pay a pretty high premium on the team and the ballpark given the quality of the facility and the quality of the operation that we have out there.

Wonderful. Thank you so much. Thanks, Patrick.

Thank you. I would like to turn the floor over to Matt for closing remarks.

Thanks, everybody. Appreciate the interest and support. We look forward to providing more updates on our first quarter earnings call in early May. Have a great rest of the week.

This concludes today's teleconference. You may disconnect your lines at this time and thank you for your participation.