Seaport Entertainment (SEG) Earnings Transcript
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. Tin Building was an ambitious undertaking and Chef Jean-Georges created a truly beautiful and distinct destination. Our partnership with the Chef and his 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 Jean-Georges 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 Balloon Museum experience to the Tin Building, which will serve as their flagship U.S. location. For those of you who are less familiar with the concept, 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 have welcomed 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, Balloon 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 under way at an estimated cost of approximately $5 million with delivery to the tenant expected by the 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 Balloon 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 ten-year agreement with a renowned Brooklyn-based 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 experience, 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 at Pier 17.
We have 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 Tin 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 skyline. All levels will be accessible via a dedicated ground floor elevator entrance and staircases with connectivity to the Rooftop at Pier 17.
The event space will also leverage Pier 17’s other unique attributes including proximity to major transportation hubs, an access-controlled 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 mid-July 4 fireworks—and improving utilization of space that was previously positioned for office use.
While we are 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 2. 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 Patriot. These initiatives are designed to drive incremental high-margin revenue while enhancing the overall guest experience with more customized and differentiated hospitality offerings.
Taking a step back and looking at the Seaport overall, as of December 31, the Seaport neighborhood was approximately 90% leased or programmed, leaving roughly 47,000 square feet of vacancy. On a pro forma basis for the Malibu Farm closure, this number is closer to 53,000 square feet. For the remaining vacancy, we are predominantly focused on complementary daily-needs and amenity-oriented tenants and incremental food and beverage opportunities where we have existing restaurant infrastructure. Since we became a stand-alone 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 along to 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 will 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, followed by Opening Day for the Las Vegas Aviators, March 27.
Additionally, after last year's hiatus, Las Vegas Ballpark will once again host the Savannah Bananas for three games starting April 30 with ticket sales currently outpacing 2024 levels. Overall, we are excited about the support for the team and how it is 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 Lina, I want to sincerely thank our team for their resilience and hard work and compassion. Their support of the company and fellow team members, especially through these transitional moments, has been tremendous. I am proud of the progress we have made. I am confident we will continue building on the strong momentum we saw through year-end 2025 and into 2026. With that, I will now turn the call over to Lina.
Lina Eliwat: Thanks, Matt. Before I get into the company's fourth quarter and full year financial performance, I would 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 in earnings or losses from unconsolidated ventures line on our consolidated and combined statements of operations. In an effort to provide more comparable information, we will 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 will reference operating EBITDA, which excludes losses on assets held for sale, impairment charges, and other nonrecurring items included in other income or loss 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 2025 and $9.18 for the full year 2025, representing a 2045% improvement, respectively. Non-GAAP adjusted net loss attributable to common stockholders was $17.5 million for the fourth quarter 2025 and $54.1 million for the full year, representing improvements of 949%, respectively, compared to the same periods in 2024.
On a per share basis, non-GAAP adjusted net loss was $1.30 for the fourth quarter 2025 and $4.26 for the full year 2025, representing a year-over-year improvement of 184%, respectively.
In the fourth quarter 2025, total consolidated revenues were $29.5 million, a 7% year-over-year increase when compared to pro forma 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 Jean-Georges 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. 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 Club, declined 15% year over year.
On a same-store basis, food and beverage revenue declined 20%, 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 2024. In the fourth quarter 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 Jean-Georges 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 and 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 at 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 stand-alone restaurants. This was partially offset by the continued growth of Gitano and the incremental revenue generated from larger events such as the Macy’s Fourth 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–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 Jean-Georges 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 and Gitano.
Turning to the Entertainment segment, fourth quarter revenues increased 68% year over year, primarily driven by the internalization of Enchant’s operations in Las Vegas. Partially offsetting this initiative was the timing of Las Vegas Aviators 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 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 2025, resulting in the loss of year-over-year comparable rental revenue in 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 nonrepeating $2 million legal settlement proceeds recognized in 2024.
Excluding these nonrecurring items, Landlord operating EBITDA declined 37% year over year on a pro forma basis as expenses increased relating to the timing of accrual for operating expenses such as cleaning, security, and utilities, along with the effects of the nonrepeating rent reserves placed in 2024. 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.
The 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 income associated with our Nike office lease, and a decrease in rent reserves compared to prior year. As a reminder, Nike exercised their termination within their lease but remains a tenant of Pier 17 through February 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 nonrecurring 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 nonrecurring 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-spin structure in prior year, and improved operating expense savings year over year.
Overall, consolidated segment adjusted EBITDA for the fourth quarter 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. Excluding the nonrecurring 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 nonrecurring items—the 250 Water Street for-sale loss, the rooftop winter structure write-off, 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 stabilizes in our first full year as a stand-alone public company as well as overall cost optimization initiatives we have 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 G&A was higher overall due to our predecessor’s cost structure and transitional expenses related to our separation from Howard Hughes. While there were significant G&A 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 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 2024 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 fourth quarter 2025.
For the full year, net interest income totaled just under $0.5 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 finance costs following our separation.
Compared to 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 warrant previously described in 2024. Excluding the warrant impairment, equity in earnings or losses from unconsolidated ventures declined approximately $300,000 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 full year. This is reflective of continued strength at the Lawn Club as it scaled through its second full year of operations.
Capital expenditures in the fourth quarter 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, rooftop winter structure, completion of Gitano and Riverdeck 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 $1 million 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 allocation opportunities for the long-term benefit of the organization and our shareholders.
With the progress made, we have 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. We will now open for questions.
Operator: Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press 1 on your telephone keypad. You may press 2 to remove yourself from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star key. Our first question comes from Matthew Erdner with JonesTrading. Please go ahead.
Matthew Erdner: Hey, good morning, guys. Thanks for taking the question, and congrats on all the progress so far. Lina, you just mentioned that you guys have $163 million cash pro forma. How much of that is committed to, you know, current projects and getting them online at the Seaport? And then with whatever is remaining there, you know, what are you guys kind of targeting there for deployment?
Lina Eliwat: Hey, Matt. Good morning. So we spent about $30 million in 2025 in capital. With our expectation for everything we have announced plus 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 million to get to stabilization. So I believe we are still, you know, expecting to target something within that range.
Matthew Morris Partridge: Hey, Matt. In terms of capital allocation, you know, we are sort of at the front end of this. Obviously, we have been focused on the existing asset base. I think we are going to look at a lot of different things. Right? We are evaluating or we are starting to evaluate opportunities in the hospitality, entertainment, and event spaces. Obviously, that is core to what we are 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 is trading. So we are going to be opportunistic. And I do not think we have any definitive path yet because we are sort of at the forefront of evaluating the opportunity. So—
Matthew Erdner: Got it. That makes sense, and that is helpful. And then you know, you mentioned on the event space, kind of that 20% return there. Are there any internal hurdles that you guys are looking to achieve, you know, as you guys deploy this cash?
Matthew Morris Partridge: 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 have a lot of talent in the building, and obviously, they are doing a great job executing on what we have. So if we can find things that complement the existing skill set, that is going to improve the flow-through of whatever we allocate capital to. So it is a moving target.
I would not say we have any hard and fast financial targets yet, but, you know, we are obviously focused on growing earnings as efficiently as possible with the best flow-through possible.
Matthew Erdner: Yep. Yep. 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 it, $33 million, $32 million of EBITDA that has been leased.
Matthew Morris Partridge: Yeah. So we have, like Lina said—or maybe I said in the prepared remarks—we have got a little over 50,000 square feet left. You know, I would say a third of that is probably restaurant-oriented space, and it also includes the former Malibu Farm space. So we will be looking at some restaurant concepts that are complementary to all the stuff that we have announced and what still exists at the Seaport. I think beyond that, you know, we have got the Balloon Museum coming. We have Meow Wolf coming. We have the event space, and then we have the Rooftop at Pier 17 concert series. That is a great set of anchors.
And then the removal of the Tin Building F&B, you know, I think that the anchor—or 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 Tin Building and positioning it to Balloon Museum is going to help all the other F&B that we have either announced exist down here or that we will look to fill the existing vacancy with.
Matthew Erdner: 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? Is it, you know, going to be event-driven stuff like you said around the World Cup, you know, people going to the bars, interacting in the cobblestones and whatnot?
Matthew Morris Partridge: 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 events and social event-related business. And so I think those two concepts with the open container that we announced are going to give us a lot of flexibility. We are 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 is also America’s 250-year anniversary.
So there will be a lot of activity during the summer around that, especially with the Fourth of July fireworks. We are going to do a lot of programming around cultural events and sporting events because I think, you know, whether it is watch parties, whether it is community-oriented events like what we have coming up this weekend around Holi, you know, we are going to do a lot of stuff down here, which I think will bring a lot of people down to the Seaport. It will give them an opportunity to experience everything we have down here, and it will support the businesses that we have got down here.
Matthew Erdner: Yeah. Yeah. That is awesome. And then last one for me, and I will step out. Lina, 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?
Lina Eliwat: We have definitely been trending positively throughout the year on G&A, 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 are continuing to try and refine that. But I would use Q4 as our reference point for right now.
Matthew Morris Partridge: Yeah. I think it will be a little up and down, Matt. You know, Q1 is going to have some transitional costs related to the closures that we have announced, plus some other changes to the team. And then I think that will benefit us in the back half of the year. But it will be a little up and down this year. But I think, to Lina’s point, Q4 is a good reference point moving forward, and hopefully we can improve upon it.
Matthew Erdner: Got it. Awesome. Thank you, guys. Appreciate it, and look forward to the continued progress.
Matthew Morris Partridge: Thanks, Matt. Thanks, Matt.
Operator: Next question, Patrick Stedelhofer with Kahn Brothers Group. Please go ahead.
Patrick Stedelhofer: Hey, good morning, and congrats on all the recent announcements.
Lina Eliwat: Thanks, Patrick.
Patrick Stedelhofer: My first question is around the kind of criteria for the buyback. You have this great slide on the deck that shows that, you know, the stock is trading at $0.50 of a dollar or probably less than that. And, obviously, that is a great hurdle rate. And so a lot of companies use buybacks on weakness, but you could argue the stock has—it's been all weakness. So I am 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 are very happy to see.
Matthew Morris Partridge: I appreciate the question. You know, for the buyback program, we will not put out any public comments related to parameters or timing. We will 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 are referencing in our supplemental. But we are also cognizant that we are building an organization that can grow over time, and we have relatively limited float. So that is always a consideration when you are using buybacks. This is my fifth public company that I have been part of. We have had buyback programs at all but one of them, and we use them opportunistically.
And I think opportunistic is the approach that we will use, but that ultimately will be a Board decision, and we will continue to have those conversations with the Board as we look at the performance of the stock and our relative alternatives from a capital allocation perspective.
Patrick Stedelhofer: Got it. And then the new Balloon Museum, just how do you view that as either complementing or competing with the Meow Wolf experience coming a year later? Just how do these two go together?
Matthew Morris Partridge: Great question. You know, I think the Balloon Museum is definitely complementary. Both of those teams—the Meow Wolf team and the Balloon Museum—know each other, and there is 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 they are going to be complementary to one another. They are 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, you know, I think activity breeds more, 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. Right? 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 are really trying to create a district that can support the local community because we have 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.
Patrick Stedelhofer: That is great. And on this apartment building you are 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 asset.
Matthew Morris Partridge: It is cash flowing. You know, there is a component of the units that are rent-stabilized. It is almost 100% leased. I think we have one or two vacant units. It has got a lot of interest. 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 will probably speak more to 85 South Street if and when we sell it rather than providing more real-time updates, just because providing real-time updates can sometimes put us at a competitive disadvantage when we are trying to work through a transaction.
Patrick Stedelhofer: 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 are kind of local there. How do the Vegas properties still fit into the company given both the geographic remoteness of it and all the—just the less news from there. Thanks a lot.
Matthew Morris Partridge: Yeah. I think, look, in Las Vegas, we have got a phenomenal facility with the ballpark. You know, it is at the center of Howard Hughes’s 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 would love to see Howard Hughes continuing to invest in that project. That ultimately will inure 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 more creative from a ticketing perspective because we have got a great ticketing team out there. Doing things like that in the off-season is only going to help the profitability of that overall operation out there. So I think we have got some room to create value. That being said, you know, I think live sports is a great business. It is a business that has seen tremendous value appreciation over time.
So, you know, if and when somebody has an interest in the team, we will always listen. But I think we would pay some 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.
Patrick Stedelhofer: Wonderful. Thank you so much.
Matthew Morris Partridge: Thanks, Patrick.
Operator: Thank you. I would like to turn the floor over to Matt for closing remarks.
Matthew Morris Partridge: 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.
Operator: This concludes today's teleconference. You may disconnect your lines at this time, and thank you for your participation.
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Seaport Entertainment (SEG) Earnings Transcript was originally published by The Motley Fool
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