Howard Hughes Upgraded to BB+ $2.1bn Acquisition

Rating Upgrade Overview

S&P Global Ratings upgraded Howard Hughes Holdings Inc. (NYSE: HHH) and its subsidiary Howard Hughes Corp. to a BB+ sovereign‑credit rating, up from B+. The agencies also removed both entities from CreditWatch Positive, where they had been placed on 19 December 2025. In addition, the issue‑level rating on Howard Hughes Corp.’s senior unsecured debt was raised to BB+ from BB‑, and the recovery rating was revised to 4 from 2.

The rating action follows Howard Hughes’ acquisition of Bermuda‑based insurer Vantage Group Holdings Ltd. for approximately $2.1 billion. The purchase was financed with $1.2 billion of cash drawn from Howard Hughes’ balance sheet and $1 billion of non‑interest‑bearing preferred stock issued to Pershing Square Holdings Ltd., an affiliate of Pershing Square. This transaction represents the first investment that aligns with Pershing Square’s strategy to transform Howard Hughes into a diversified holding company.

S&P noted that Howard Hughes’ credit profile will benefit from the more stable, less cyclical cash flows generated by Vantage’s insurance operations, which are well‑capitalised and generally more predictable than Howard Hughes Corp.’s real‑estate development and operating businesses that have historically been capital‑intensive and subject to cyclical swings.

The agencies also highlighted that Howard Hughes and Howard Hughes Corp. are expected to receive a degree of support from Pershing Square Inc. and its affiliates, which together own a plurality of Howard Hughes shares. Pershing Square Inc. and various Pershing Square funds hold a combined 47 % of Howard Hughes’ common stock. Pershing Square’s chief executive officer, Bill Ackman, serves as chairman of the Howard Hughes board, while the firm’s chief investment officer, Ryan Israel, sits on the board and also serves as Howard Hughes’ CIO.

S&P assigned a stable outlook, reflecting its expectation that Howard Hughes will remain a long‑term holding of Pershing Square and will continue to be an important component of Pershing Square’s investment strategy over the next 12 months. The rating agency also expects the real‑estate business to adopt a more conservative capital‑allocation approach and projects that leverage at the subsidiary Howard Hughes Corp. will be close to 5.5 times earnings before interest, taxes, depreciation and amortisation (EBITDA) over the next two years.