Despite significantly higher revenue, Hudson Pacific Properties Inc. swung to a loss in the first quarter as the real estate investment trust saw higher operating costs and recorded charges associated with the loss of a large tenant from one of its Orange County properties.

The Los Angeles office landlord late Tuesday reported a net loss of $2.5 million (-11 cents per share), compared with net income of $700,000 a year earlier. Revenue rose 244 percent to $34.8 million, with $14.7 million coming from rents of recently acquired properties.

Funds from operations were $8.81 million (34 cents). FFO is a key REIT metric that adds depreciation and amortization expenses back into earnings to get a better picture of cash performance.

Hudson, which controls 13 properties totaling about 4 million square feet of leasable space, took a write-off associated with early termination of a single-floor tenant at its City Plaza complex in Orange that resulted in a non-cash impact of 3 cents per share to FFO. That was offset by an early lease termination payment that worked out to 11 cents per share. Excluding these and other adjustments, FFO would have been $6.8 million (26 cents). Analysts surveyed by Thomson Reuters on average expected Hudson to report adjusted FFO of 32 cents per share.

Total operating expenses rose 255 percent to $30 million, primarily from office properties acquired in connection with the company's initial public offering last June and other acquisitions in the second half of the year.

The company earlier this month completed a secondary offering of more than 8 million shares and a 3 million share private placement that resulted in total proceeds of nearly $157 million. Hudson used some of the net proceeds to pay down debt.

“We continue to see strong leasing activity and improving fundamentals in most of our markets, especially in San Francisco, where we completed more than 100,000 square feet of new and renewal leases in the first quarter, often at starting rents and with concessions that were better than initially projected,” Chief Executive Victor J. Coleman said in a statement.

Shares were down 54 cents, or 3.5 percent, to $15.08 in midday trading on the New York Stock Exchange.

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