Equibles

8-K

BXP, Inc. (BXP)

8-K 2020-01-29 For: 2020-01-28
View Original
Added on April 08, 2026

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of report (Date of earliest event reported): January 28, 2020

BOSTON PROPERTIES, INC.

BOSTON PROPERTIES LIMITED PARTNERSHIP

(Exact Name of Registrants As Specified in its Charter)

Boston Properties, Inc. Delaware 1-13087 04-2473675
(State or Other Jurisdiction<br><br>of Incorporation) (Commission File Number) (IRS Employer<br><br>Identification No.)
Boston Properties Limited Partnership Delaware 0-50209 04-3372948
(State or Other Jurisdiction<br><br>of Incorporation) (Commission File Number) (IRS Employer<br><br>Identification No.)

800 Boylston Street, Suite 1900, Boston, Massachusetts 02199

(Address of Principal Executive Offices) (Zip Code)

(617) 236-3300

(Registrants’ telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrants under any of the following provisions (see General Instruction A.2. below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Securities registered pursuant to Section 12(b) of the Act:
Registrant Title of each class Name of each exchange on which registered
Boston Properties, Inc. Common Stock, par value 0.01 per share New York Stock Exchange
Boston Properties, Inc. Depository Shares Each Representing 1/100th of a share New York Stock Exchange
of 5.25% Series B Cumulative Redeemable Preferred Stock, par value 0.01 per share

All values are in US Dollars.

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Boston Properties, Inc.:

Emerging growth company ☐

Boston Properties Limited Partnership:

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Boston Properties, Inc. ☐         Boston Properties Limited Partnership ☐

Item 2.02. Results of Operations and Financial Condition.

The information in this Item 2.02 - “Results of Operations and Financial Condition” is being furnished. Such information, including Exhibits 99.1 and 99.2 hereto, shall not be deemed “filed” for any purpose, including for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section. The information in this Item 2.02, including Exhibits 99.1 and 99.2, shall not be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act regardless of any general incorporation language in such filing.

On January 28, 2020, Boston Properties, Inc. (the “Company”), the general partner of Boston Properties Limited Partnership, issued a press release announcing its financial results for the fourth quarter of 2019. That press release referred to certain supplemental information that is available on the Company’s website. The text of the supplemental information and the press release are attached hereto as Exhibits 99.1 and 99.2, respectively, and are incorporated by reference herein.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No. Description
*99.1 Boston Properties, Inc. Supplemental Operating and Financial Data for the quarter ended December 31, 2019.
*99.2 Press release dated January 28, 2020.
*101.SCH Inline XBRL Taxonomy Extension Schema Document.
*101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document.
*101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document.
*101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document.
*101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document.
*104 Cover Page Interactive Data File (formatted as Inline XBRL with applicable taxonomy extension information contained in Exhibits 101.*).

______________

* Filed herewith.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrants have duly caused this report to be signed on their behalf by the undersigned hereunto duly authorized.

BOSTON PROPERTIES, INC.
By: /s/    MICHAEL E. LABELLE
Michael E. LaBelle
Executive Vice President, Chief Financial Officer
and Treasurer
BOSTON PROPERTIES LIMITED PARTNERSHIP
By: Boston Properties, Inc., its General Partner
By: /s/    MICHAEL E. LABELLE
Michael E. LaBelle
Executive Vice President, Chief Financial Officer
and Treasurer

Date: January 28, 2020

		Exhibit

Exhibit 99.1

hubcausewaypodium.jpg

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Supplemental Operating and Financial Data

for the Quarter Ended December 31, 2019

THE COMPANY

Boston Properties, Inc. (NYSE: BXP) (“Boston Properties,” “BXP” or the “Company”) is the largest publicly-traded developer, owner and manager of Class A office properties in the United States, concentrated in five markets -  Boston, Los Angeles, New York, San Francisco and Washington, DC. The Company is a fully integrated real estate company, organized as a real estate investment trust (REIT), that develops, manages, operates, acquires and owns a diverse portfolio of primarily Class A office space. The Company’s complete portfolio totals 52.0 million square feet and 196 properties, including 11 properties under construction/redevelopment, and consists of 177 office properties, 12 retail properties, six residential properties and one hotel. Boston Properties is well-known for its in-house building management expertise and responsiveness to tenants’ needs. The Company holds a superior track record of developing premium Central Business District (CBD) office buildings, successful mixed-use complexes, suburban office centers and build-to-suit projects for a diverse array of creditworthy tenants. Boston Properties actively works to promote its growth and operations in a sustainable and responsible manner.  The Company has earned eight consecutive Global Real Estate Sustainability Benchmark (GRESB) Green Stars and the highest GRESB 5-star Rating. Boston Properties, an S&P 500 Company, was founded in 1970 by Mortimer B. Zuckerman and Edward H. Linde and became a public company in 1997.

FORWARD-LOOKING STATEMENTS

This Supplemental package contains forward-looking statements within the meaning of the Federal securities laws. You can identify these statements by our use of the words “assumes,” “believes,” “budgeted,” “estimates,” “expects,” “guidance,” “intends,” “may,” “might,” “plans,” “projects,” “should,” “will” and similar expressions that do not relate to historical matters. You should exercise caution in interpreting and relying on forward-looking statements because they involve known and unknown risks, uncertainties and other factors that are, in some cases, beyond Boston Properties’ control and could materially affect actual results, performance or achievements. These factors include, without limitation, the ability to enter into new leases or renew leases on favorable terms, dependence on tenants’ financial condition, the uncertainties of real estate development, acquisition and disposition activity, the ability to effectively integrate acquisitions, the uncertainties of investing in new markets, the ability of our joint venture partners to satisfy their obligations, the costs and availability of financing, the effectiveness of our interest rate hedging programs, the effects of local, national and international economic and market conditions, the effects of acquisitions, dispositions and possible impairment charges on our operating results, the impact of newly adopted accounting principles on the Company’s accounting policies and on period-to-period comparisons of financial results, regulatory changes and other risks and uncertainties detailed from time to time in the Company’s filings with the Securities and Exchange Commission. These forward-looking statements speak only as of the date of issuance of this report and are not guarantees of future results, performance or achievements. Boston Properties does not undertake a duty to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

NON-GAAP FINANCIAL MEASURES

This Supplemental package includes non-GAAP financial measures, which are accompanied by what the Company considers the most directly comparable financial measures calculated and presented in accordance with GAAP. Quantitative reconciliations of the differences between the most directly comparable GAAP financial measures and the non-GAAP financial measures presented are provided within this Supplemental package. Definitions of these non-GAAP financial measures and statements of the reasons why management believes the non-GAAP measures provide useful information to investors about the Company’s financial condition and results of operations, and, if applicable, the other purposes for which management uses the measures, can be found in the Definitions section of this Supplemental starting on page 54.

The Company also presents “BXP’s Share” of certain of these measures, which are non-GAAP financial measures that are calculated as the consolidated amount calculated in accordance with GAAP, plus the Company’s share of the amount from the Company’s unconsolidated joint ventures (calculated based upon the Company’s percentage ownership interest and, in some cases, after priority allocations), minus the Company’s partners’ share of the amount from the Company’s consolidated joint ventures (calculated based upon the partners’ percentage ownership interests and, in some cases, after priority allocations, income allocation to private REIT shareholders and their share of fees due to the Company).  Management believes that presenting “BXP’s Share” of these measures provides useful information to investors regarding the Company’s financial condition and/or results of operations because the Company has several significant joint ventures and in some cases, the Company exercises significant influence over, but does not control, the joint venture, in which case GAAP requires that the Company account for the joint venture entity using the equity method of accounting and the Company does not consolidate it for financial reporting purposes. In other cases, GAAP requires that the Company consolidate the venture even though the Company’s partner(s) owns a significant percentage interest. As a result, management believes that presenting BXP Share of various financial measures in this manner can help investors better understand the Company’s financial condition and/or results of operations after taking into account its true economic interest in these joint ventures.  The Company cautions investors that the ownership percentages used in calculating “BXP’s Share” of these measures may not completely and accurately depict all of the legal and economic implications of holding an interest in a consolidated or unconsolidated joint venture. For example, in addition to partners’ interests in profits and capital, venture agreements vary in the allocation of rights regarding decision making (both routine and major decisions), distributions, transferability of interests, financings and guarantees, liquidations and other matters. As a result, presentations of “BXP’s Share” of a financial measure should not be considered a substitute for, and should only be considered together with and as a supplement to, the Company’s financial information presented in accordance with GAAP. Unless noted otherwise, reconciliations of “BXP’s Share” of these financial measures can be found in the Reconciliations section of this Supplemental package starting on page 58.

GENERAL INFORMATION

Corporate Headquarters Trading Symbol Investor Relations Inquiries
800 Boylston Street BXP Boston Properties, Inc. Inquiries should be directed to
Suite 1900 800 Boylston Street, Suite 1900 Michael E. LaBelle
Boston, MA 02199 Stock Exchange Listing Boston, MA 02199 Executive Vice President, Chief Financial Officer
www.bxp.com New York Stock Exchange investors.bxp.com at 617.236.3352 or
(t) 617.236.3300 investorrelations@bxp.com mlabelle@bxp.com
(f) 617.236.3311 (t) 617.236.3822
(f) 617.236.3311 Sara Buda
Vice President, Investor Relations
at 617.236.3429 or
sbuda@bxp.com

(Cover photo: Hub on Causeway - Podium, Boston, MA)

Q4 2019
Table of contents Page
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OVERVIEW
Company Profile 1
Guidance and Assumptions 2
FINANCIAL INFORMATION
Financial Highlights 3
Consolidated Balance Sheets 5
Consolidated Income Statements 6
Funds From Operations (FFO) 7
Funds Available for Distribution (FAD) 8
Net Operating Income (NOI) 9
Same Property Net Operating Income (NOI) by Reportable Segment 11
Capital Expenditures, Tenant Improvement Costs and Leasing Commissions 12
Acquisitions and Dispositions 13
DEVELOPMENT ACTIVITY
Construction in Progress 14
Land Parcels and Purchase Options 16
LEASING ACTIVITY
Leasing Activity 17
PROPERTY STATISTICS
Portfolio Overview 18
Residential and Hotel Performance 19
In-Service Property Listing 21
Top 20 Tenants Listing and Portfolio Tenant Diversification 25
Occupancy by Location 26
DEBT AND CAPITALIZATION
Capital Structure 27
Debt Analysis 28
Senior Unsecured Debt Covenant Compliance Ratios 29
Net Debt to EBITDAre 30
Debt Ratios 31
JOINT VENTURES
Consolidated Joint Ventures 32
Unconsolidated Joint Ventures 34
LEASE EXPIRATION ROLL-OUT
Total In-Service Properties 38
Boston 39
Los Angeles 41
New York 43
San Francisco 45
Washington, DC 47
CBD 49
Suburban 51
RESEARCH COVERAGE, DEFINITIONS AND RECONCILIATIONS
Research Coverage 53
Definitions 54
Reconciliations 58
Consolidated Income Statement - Prior Year 64
Q4 2019
Company profile

SNAPSHOT

(as of December 31, 2019)

Fiscal Year-End December 31
Total Properties (includes unconsolidated joint ventures) 196
Total Square Feet (includes unconsolidated joint ventures) 52.0 million
Common shares outstanding, plus common units and LTIP units (other than unearned Multi-Year Long-Term Incentive Program (MYLTIP) Units) on an as-converted basis ^1^ 172.7 million
Closing Price, at the end of the quarter $137.86 per share
Dividend - Quarter/Annualized $0.98/$3.92 per share
Dividend Yield 2.84%
Consolidated Market Capitalization ^1^ $35.8 billion
BXP’s Share of Market Capitalization ^1, 2^ $35.6 billion
Senior Debt Ratings A- (S&P); Baa1 (Moody’s)

STRATEGY

Boston Properties’ primary business objective is to maximize return on investment in an effort to provide its investors with the greatest possible total return in all points of the economic cycle. To achieve this objective, the Company maintains consistent strategies that include the following:

• to maintain a keen focus on select markets that exhibit the strongest economic growth and investment characteristics over time - currently Boston, Los Angeles, New York, San Francisco and Washington, DC;
• to invest in the highest quality buildings (primarily office) with unique amenities and locations that are able to maintain high occupancy, achieve premium rental rates through economic cycles and that advance our commitment to sustainable development and operations;
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• in our core markets, to maintain scale and a full-service real estate capability (development, construction, leasing and property management) to ensure we (1) see all relevant investment deal flow, (2) maintain an ability to execute on all types of real estate opportunities, such as development, repositioning, acquisitions and dispositions, throughout the real estate investment cycle and (3) provide superior service to our tenants;
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• to be astute in market timing for investment decisions by developing into economic growth, acquiring properties in times of opportunity and selling assets at attractive prices, resulting in continuous portfolio refreshment;
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• to ensure a strong balance sheet to maintain consistent access to capital and the resultant ability to make opportunistic investments; and
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• to foster a culture and reputation of integrity, excellence and purposefulness, making us the employer of choice for talented real estate professionals and the counterparty of choice for tenants and real estate industry participants.
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MANAGEMENT

Board of Directors Chairman Emeritus
Joel I. Klein Chairman of the Board Mortimer B. Zuckerman
Owen D. Thomas Chief Executive Officer
Douglas T. Linde President Management
Kelly A. Ayotte Owen D. Thomas Chief Executive Officer
Bruce W. Duncan Chair of Compensation Committee Douglas T. Linde President
Karen E. Dykstra Raymond A. Ritchey Senior Executive Vice President
Carol B. Einiger Michael E. LaBelle Executive Vice President, Chief Financial Officer and Treasurer
Diane J. Hoskins
Matthew J. Lustig Chair of Nominating & Corporate Governance Committee Peter D. Johnston Executive Vice President, Washington, DC Region
Bryan J. Koop Executive Vice President, Boston Region
David A. Twardock Chair of Audit Committee Robert E. Pester Executive Vice President, San Francisco Region
William H. Walton, III John F. Powers Executive Vice President, New York Region
Frank D. Burt Senior Vice President and Chief Legal Officer
Michael R. Walsh Senior Vice President and Chief Accounting Officer

TIMING OF EARNINGS ANNOUNCEMENTS

Quarterly results for the next four quarters will be announced according to the following schedule:

First Quarter, 2020 Tentatively April 28, 2020
Second Quarter, 2020 Tentatively July 28, 2020
Third Quarter, 2020 Tentatively October 27, 2020
Fourth Quarter, 2020 Tentatively January 26, 2021

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^1^ For additional detail, see page 27.
^2^ For the Company’s definitions and related disclosures, see the Definitions and Reconciliations sections of this Supplemental package starting on page 54.
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1

Q4 2019
Guidance and assumptions

GUIDANCE

The Company’s guidance for the first quarter and full year 2020 for diluted earnings per common share attributable to Boston Properties, Inc. common shareholders (EPS) and diluted funds from operations (FFO) per common share attributable to Boston Properties, Inc. common shareholders is set forth and reconciled below.  Except as described below, the estimates reflect management’s view of current and future market conditions, including assumptions with respect to rental rates, occupancy levels, the timing of the lease-up of available space and development deliveries and the earnings impact of the events referenced in the Company’s earnings release issued on January 28, 2020 and otherwise referenced during the Company’s conference call scheduled for January 29, 2020.  Except as otherwise publicly disclosed, the estimates do not include any material (1) possible future gains or losses or the impact on operating results from other possible future property acquisitions or dispositions, (2) other possible capital markets activity or (3) possible future impairment charges. EPS estimates may be subject to fluctuations as a result of several factors, including changes in the recognition of depreciation and amortization expense and any gains or losses associated with disposition activity. The Company is not able to assess at this time the potential impact of these factors on projected EPS. By definition, FFO does not include real estate-related depreciation and amortization, impairment losses on depreciable real estate or gains or losses associated with disposition activities. For a complete definition of FFO and statements of the reasons why management believes it provides useful information to investors, see page 56. There can be no assurance that the Company’s actual results will not differ materially from the estimates set forth below.

First Quarter 2020 Full Year 2020
Low High Low High
Projected EPS (diluted) $ 3.22 $ 3.24 $ 5.91 $ 6.09
Add:
Projected Company share of real estate depreciation and amortization 0.95 0.95 3.93 3.93
Projected Company share of (gains)/losses on sales of real estate (2.37 ) (2.37 ) (2.37 ) (2.37 )
Projected FFO per share (diluted) $ 1.80 $ 1.82 $ 7.47 $ 7.65

ASSUMPTIONS

(dollars in thousands)

Full Year 2020
Low High
Operating property activity:
Average In-service portfolio occupancy 92.50 % — 93.50 %
Increase in BXP’s Share of Same Property net operating income (excluding termination income) 3.00 % — 4.75 %
Increase in BXP’s Share of Same Property net operating income - cash (excluding termination income) 3.00 % — 4.75 %
BXP’s Share of Non Same Properties’ incremental contribution to net operating income over prior year (excluding asset sales) $ 60,000 — $ 70,000
BXP’s Share of incremental net operating income related to asset sales over prior year $ (15,000 ) — $ (15,000 )
BXP’s Share of straight-line rent and fair value lease revenue (non-cash revenue) $ 110,000 — $ 135,000
Hotel net operating income $ 14,500 — $ 16,000
Termination income $ 2,000 — $ 8,000
Other revenue (expense):
Development and management services revenue $ 27,000 — $ 33,000
General and administrative expense ^1^ $ (146,000 ) — $ (142,000 )
Net interest expense $ (415,000 ) — $ (395,000 )
Noncontrolling interest:
Noncontrolling interest in property partnerships’ share of FFO $ (155,000 ) — $ (145,000 )

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^1^ Excludes estimated changes in the market value of the Company’s deferred compensation plan and Gains from investments in securities.

2

Q4 2019
Financial highlights

(unaudited and in thousands, except ratios and per share amounts)

Three Months Ended
31-Dec-19 30-Sep-19
Net income attributable to Boston Properties, Inc. common shareholders $ 140,824 $ 107,771
Net income attributable to Boston Properties, Inc. per share - diluted $ 0.91 $ 0.70
FFO attributable to Boston Properties, Inc. common shareholders ^1^ $ 289,937 $ 253,631
Diluted FFO per share ^1^ $ 1.87 $ 1.64
Dividends per common share $ 0.98 $ 0.95
Funds available for distribution to common shareholders and common unitholders (FAD) ^2^ $ 185,828 $ 191,920
Selected items:
Revenue $ 757,501 $ 743,553
Recoveries from tenants $ 121,147 $ 124,445
Service income from tenants $ 3,312 $ 3,180
BXP’s Share of revenue ^3^ $ 722,647 $ 704,171
BXP’s Share of straight-line rent ^3, 4^ $ 43,501 $ (1,904 )
BXP’s Share of straight-line rent from deferred revenue ^3, 5^ $ — $ (22,156 )
BXP’s Share of fair value lease revenue ^3, 6^ $ 3,298 $ 4,467
BXP’s Share of termination income ^3^ $ 1,397 $ 1,960
Ground rent expense $ 3,602 $ 3,637
Capitalized interest $ 13,658 $ 16,184
Capitalized wages $ 2,327 $ 2,583
BXP’s Share of internal leasing and external legal costs that were to be capitalized prior to the adoption of ASU 2016-02 - “Leases” on January 1, 2019 ^3^ $ 844 $ 1,523
Income (loss) from unconsolidated joint ventures $ (936 ) $ (649 )
BXP’s share of FFO from unconsolidated joint ventures ^7^ $ 13,554 $ 13,583
Net income attributable to noncontrolling interests in property partnerships $ 16,338 $ 18,470
FFO attributable to noncontrolling interests in property partnerships ^8^ $ 34,454 $ 35,872
Balance Sheet items:
Above-market rents (included within Prepaid Expenses and Other Assets) $ 9,843 $ 11,535
Below-market rents (included within Other Liabilities) $ 39,343 $ 44,000
Accrued rental income liability (included within Other Liabilities) ^4^ $ 125,964 $ 127,699
Ratios:
Interest Coverage Ratio (excluding capitalized interest) ^9^ 4.10 4.01
Interest Coverage Ratio (including capitalized interest) ^9^ 3.55 3.43
Fixed Charge Coverage Ratio ^9^ 2.84 2.66
BXP’s Share of Net Debt to BXP’s Share of EBITDAre ^10^ 6.38 6.47
Change in BXP’s Share of Same Store Net Operating Income (NOI) (excluding termination income) ^11^ 5.2 % 7.1 %
Change in BXP’s Share of Same Store NOI (excluding termination income) - cash ^11^ (0.1 )% 5.2 %
FAD Payout Ratio ^2^ 91.12 % 85.47 %
Operating Margins [(rental revenue - rental expense)/rental revenue] 63.3 % 63.0 %
Occupancy of In-Service Properties 93.0 % 92.6 %
Capitalization:
Consolidated Debt $ 11,811,806 $ 11,838,738
BXP’s Share of Debt ^12^ $ 11,592,062 $ 11,561,991
Consolidated Market Capitalization $ 35,819,952 $ 34,415,850
Consolidated Debt/Consolidated Market Capitalization 32.98 % 34.40 %
BXP’s Share of Market Capitalization ^12^ $ 35,600,208 $ 34,139,103
BXP’s Share of Debt/BXP’s Share of Market Capitalization ^12^ 32.56 % 33.87 %

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^1^ For a quantitative reconciliation of FFO attributable to Boston Properties, Inc. common shareholders and Diluted FFO per share, see page 7.
^2^ For a quantitative reconciliation of FAD, see page 8. FAD Payout Ratio equals distributions to common shareholders and unitholders (excluding any special distributions) divided by FAD.
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^3^ See the Definitions and Reconciliations sections of this Supplemental package starting on page 54.
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^4^ For the three months ended September 30, 2019, includes the straight-line impact related to deferred revenue from a tenant.
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^5^ Represents the straight-line impact related to deferred revenue from a tenant. For additional information, see page 58.
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^6^ Represents the net adjustment for above- and below-market leases that are amortized over the terms of the respective leases in place at the property acquisition dates.^^^^
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3

Q4 2019
Financial highlights (continued)
^7^ For a quantitative reconciliation for the three months ended December 31, 2019, see page 36.
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^8^ For a quantitative reconciliation for the three months ended December 31, 2019, see page 33.
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^9^ For a quantitative reconciliation for the three months ended December 31, 2019 and September 30, 2019, see page 31.
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^10^ For a quantitative reconciliation for the three months ended December 31, 2019 and September 30, 2019, see page 30.
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^11^ For a quantitative reconciliation for the three months ended December 31, 2019, see page 11.
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^12^ For a quantitative reconciliation for December 31, 2019, see page 27.
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4

Q4 2019
Consolidated Balance Sheets

(unaudited and in thousands)

31-Dec-19 30-Sep-19
ASSETS
Real estate $ 21,458,412 $ 21,088,492
Construction in progress 789,736 953,336
Land held for future development 254,828 246,972
Right of use assets - finance leases 237,394 237,394
Right of use assets - operating leases 148,640 149,231
Less accumulated depreciation (5,266,798 ) (5,164,353 )
Total real estate 17,622,212 17,511,072
Cash and cash equivalents 644,950 751,210
Cash held in escrows 46,936 53,555
Investments in securities 36,747 34,375
Tenant and other receivables, net 112,807 102,155
Related party note receivable 80,000 80,000
Note receivable 15,920 19,844
Accrued rental income, net 1,038,788 1,003,033
Deferred charges, net 689,213 689,768
Prepaid expenses and other assets 41,685 110,308
Investments in unconsolidated joint ventures 955,647 933,255
Total assets $ 21,284,905 $ 21,288,575
LIABILITIES AND EQUITY
Liabilities:
Mortgage notes payable, net $ 2,922,408 $ 2,952,006
Unsecured senior notes, net 8,390,459 8,387,913
Unsecured line of credit — —
Unsecured term loan, net 498,939 498,819
Lease liabilities- finance leases 224,042 221,029
Lease liabilities - operating leases 200,180 199,755
Accounts payable and accrued expenses 377,553 421,269
Dividends and distributions payable 170,713 165,421
Accrued interest payable 90,016 83,177
Other liabilities 387,994 356,338
Total liabilities 13,262,304 13,285,727
Commitments and contingencies — —
Redeemable deferred stock units 8,365 7,081
Equity:
Stockholders’ equity attributable to Boston Properties, Inc.:
Excess stock, $0.01 par value, 150,000,000 shares authorized, none issued or outstanding — —
Preferred stock, $0.01 par value, 50,000,000 shares authorized; 5.25% Series B cumulative redeemable preferred stock, $0.01 par value, liquidation preference $2,500 per share, 92,000 shares authorized, 80,000 shares issued and outstanding at December 31, 2019 and September 30, 2019 200,000 200,000
Common stock, $0.01 par value, 250,000,000 shares authorized, 154,869,198 and 154,650,973 issued and 154,790,298 and 154,572,073 outstanding at December 31, 2019 and September 30, 2019, respectively 1,548 1,546
Additional paid-in capital 6,294,719 6,274,792
Dividends in excess of earnings (760,523 ) (749,666 )
Treasury common stock at cost, 78,900 shares at December 31, 2019 and September 30, 2019 (2,722 ) (2,722 )
Accumulated other comprehensive loss (48,335 ) (51,996 )
Total stockholders’ equity attributable to Boston Properties, Inc. 5,684,687 5,671,954
Noncontrolling interests:
Common units of the Operating Partnership 600,860 603,690
Property partnerships 1,728,689 1,720,123
Total equity 8,014,236 7,995,767
Total liabilities and equity $ 21,284,905 $ 21,288,575

5

Q4 2019
Consolidated Income Statements

(unaudited and in thousands, except per share amounts)

Three Months Ended
31-Dec-19 30-Sep-19
Revenue
Lease $ 706,349 $ 692,225
Parking and other 26,727 25,582
Hotel revenue 11,793 13,014
Development and management services 10,473 10,303
Direct reimbursements of payroll and related costs from management services contracts 2,159 2,429
Total revenue 757,501 743,553
Expenses
Operating 131,246 129,852
Real estate taxes 136,911 135,419
Demolition costs 762 332
Hotel operating 8,318 8,743
General and administrative ^1^ 32,797 31,147
Payroll and related costs from management services contracts 2,159 2,429
Transaction costs 569 538
Depreciation and amortization 169,897 165,862
Total expenses 482,659 474,322
Other income (expense)
Income (loss) from unconsolidated joint ventures (936 ) (649 )
Gains (losses) on sales of real estate (57 ) (15 )
Gains from investments in securities^1^ 2,177 106
Interest and other income 4,393 7,178
Losses from early extinguishments of debt (1,530 ) (28,010 )
Interest expense (102,880 ) (106,471 )
Net income 176,009 141,370
Net income attributable to noncontrolling interests
Noncontrolling interest in property partnerships (16,338 ) (18,470 )
Noncontrolling interest - common units of the Operating Partnership ^2^ (16,222 ) (12,504 )
Net income attributable to Boston Properties, Inc. 143,449 110,396
Preferred dividends (2,625 ) (2,625 )
Net income attributable to Boston Properties, Inc. common shareholders $ 140,824 $ 107,771
INCOME PER SHARE OF COMMON STOCK (EPS)
Net income attributable to Boston Properties, Inc. per share - basic $ 0.91 $ 0.70
Net income attributable to Boston Properties, Inc. per share - diluted $ 0.91 $ 0.70

_____________

^1^ General and administrative expense includes $2.2 million and $0.1 million and Gains from investments in securities include $2.2 million and $0.1 million for the three months ended December 31, 2019 and September 30, 2019, respectively, related to the Company’s deferred compensation plan.
^2^ For additional detail, see page 7.
--- ---

6

Q4 2019
Funds from operations (FFO) ^1^
(unaudited and dollars in thousands, except per share amounts) Three Months Ended
31-Dec-19 30-Sep-19
Net income attributable to Boston Properties, Inc. common shareholders $ 140,824 $ 107,771
Add:
Preferred dividends 2,625 2,625
Noncontrolling interest - common units of the Operating Partnership 16,222 12,504
Noncontrolling interests in property partnerships 16,338 18,470
Net income 176,009 141,370
Add:
Depreciation and amortization expense 169,897 165,862
Noncontrolling interests in property partnerships' share of depreciation and amortization ^2^ (18,116 ) (17,402 )
BXP's share of depreciation and amortization from unconsolidated joint ventures ^3^ 14,458 13,745
Corporate-related depreciation and amortization (477 ) (411 )
Less:
Gain on sale of real estate included within income (loss) from unconsolidated joint ventures (32 ) (487 )
Gains (losses) on sales of real estate (57 ) (15 )
Noncontrolling interests in property partnerships 16,338 18,470
Preferred dividends 2,625 2,625
FFO attributable to the Operating Partnership common unitholders (including Boston Properties, Inc.) (Basic FFO) 322,897 282,571
Less:
Noncontrolling interest - common units of the Operating Partnership’s share of FFO 32,960 28,940
FFO attributable to Boston Properties, Inc. common shareholders $ 289,937 $ 253,631
Boston Properties, Inc.’s percentage share of Basic FFO 89.79 % 89.76 %
Noncontrolling interest’s - common unitholders percentage share of Basic FFO 10.21 % 10.24 %
Basic FFO per share $ 1.87 $ 1.64
Weighted average shares outstanding - basic 154,667 154,577
Diluted FFO per share $ 1.87 $ 1.64
Weighted average shares outstanding - diluted 154,992 154,820
RECONCILIATION TO DILUTED FFO
--- --- --- --- ---
Three Months Ended
31-Dec-19 30-Sep-19
Basic FFO $ 322,897 $ 282,571
Add:
Effect of dilutive securities - stock-based compensation — —
Diluted FFO 322,897 282,571
Less:
Noncontrolling interest - common units of the Operating Partnership’s share of diluted FFO 32,898 28,900
Boston Properties, Inc.’s share of Diluted FFO $ 289,999 $ 253,671
RECONCILIATION OF SHARES/UNITS FOR DILUTED FFO
--- --- --- --- ---
Three Months Ended
31-Dec-19 30-Sep-19
Shares/units for Basic FFO 172,250 172,215
Add:
Effect of dilutive securities - stock-based compensation (shares/units) 325 243
Shares/units for Diluted FFO 172,575 172,458
Less:
Noncontrolling interest - common units of the Operating Partnership’s share of Diluted FFO (shares/units) 17,583 17,638
Boston Properties, Inc.’s share of shares/units for Diluted FFO 154,992 154,820
Boston Properties, Inc.’s percentage share of Diluted FFO 89.81 % 89.77 %

_____________

^1^ See the Definitions and Reconciliations sections of this Supplemental package starting on page 54.
^2^ For a quantitative reconciliation for the three months ended December 31, 2019, see page 33.
--- ---
^3^ For a quantitative reconciliation for the three months ended December 31, 2019, see page 36.
--- ---

7

Q4 2019
Funds available for distributions (FAD) ^1^

(dollars in thousands)

Three Months Ended
31-Dec-19 30-Sep-19
Net income attributable to Boston Properties, Inc. common shareholders $ 140,824 $ 107,771
Add:
Preferred dividends 2,625 2,625
Noncontrolling interest - common units of the Operating Partnership 16,222 12,504
Noncontrolling interests in property partnerships 16,338 18,470
Net income 176,009 141,370
Add:
Depreciation and amortization expense 169,897 165,862
Noncontrolling interests in property partnerships’ share of depreciation and amortization ^2^ (18,116 ) (17,402 )
BXP’s share of depreciation and amortization from unconsolidated joint ventures ^3^ 14,458 13,745
Corporate-related depreciation and amortization (477 ) (411 )
Less:
Gain on sale of real estate included within income (loss) from unconsolidated joint ventures (32 ) (487 )
Gains (losses) on sales of real estate (57 ) (15 )
Noncontrolling interests in property partnerships 16,338 18,470
Preferred dividends 2,625 2,625
Basic FFO 322,897 282,571
Add:
BXP’s Share of lease transaction costs that qualify as rent inducements ^1,^ ^4^ 9,403 2,041
BXP’s Share of hedge amortization ^1^ 1,435 1,435
BXP’s Share of straight-line ground rent expense adjustment ^1, 5^ 1,056 1,019
Stock-based compensation 7,705 7,809
Non-real estate depreciation 477 411
Unearned portion of capitalized fees from consolidated joint ventures ^6^ 1,300 836
Less:
BXP’s Share of straight-line rent ^1^ 43,501 (1,904 )
BXP’s Share of fair value lease revenue ^1, 7^ 3,298 4,467
BXP’s Share of non-cash termination income adjustment (fair value lease amounts) ^1^ — —
BXP’s Share of 2nd generation tenant improvements and leasing commissions ^1^ 86,041 70,199
BXP’s Share of maintenance capital expenditures ^1, 8^ 25,457 31,263
Hotel improvements, equipment upgrades and replacements 148 177
Funds available for distribution to common shareholders and common unitholders (FAD) (A) $ 185,828 $ 191,920
Distributions to common shareholders and unitholders (excluding any special distributions) (B) $ 169,334 $ 164,043
FAD Payout Ratio^1^(B÷A) 91.12 % 85.47 %

_____________

^1^ See the Definitions and Reconciliations sections of this Supplemental package starting on page 54.
^2^ For a quantitative reconciliation for the three months ended December 31, 2019, see page 33.
--- ---
^3^ For a quantitative reconciliation for the three months ended December 31, 2019, see page 36.
--- ---
^4^ Consists of lease transaction costs that qualify as rent inducements in accordance with GAAP. Lease transaction costs are generally included in 2nd generation tenant improvements and leasing commissions in the period the lease commences.
--- ---
^5^ Includes the straight-line impact of the Company’s 99-year ground and air rights lease related to the Company’s 100 Clarendon Street garage and Back Bay Transit Station. The Company has allocated contractual ground lease payments aggregating approximately $34.4 million, which it expects to incur by the end of 2023 with no payments thereafter. The Company is recognizing this expense on a straight-line basis over the 99-year term of the ground and air rights lease, see page 3.
--- ---
^6^ See page 60 for additional information.
--- ---
^7^ Represents the net adjustment for above- and below-market leases that are amortized over the terms of the respective leases in place at the property acquisition dates.^^
--- ---
^8^ Maintenance capital expenditures do not include planned capital expenditures related to acquisitions and repositioning capital expenditures.
--- ---

8

Q4 2019
Reconciliation of net income attributable to Boston Properties, Inc. common shareholders to BXP’s Share of same property net operating income (NOI)
(in thousands) Three Months Ended
31-Dec-19 31-Dec-18
Net income attributable to Boston Properties, Inc. common shareholders $ 140,824 $ 148,529
Preferred dividends 2,625 2,625
Net income attributable to Boston Properties, Inc. 143,449 151,154
Net income attributable to noncontrolling interests:
Noncontrolling interest - common units of the Operating Partnership 16,222 17,662
Noncontrolling interest in property partnerships 16,338 16,425
Net income 176,009 185,241
Add:
Interest expense 102,880 100,378
Losses from early extinguishments of debt 1,530 16,490
Impairment loss — 11,812
Depreciation and amortization expense 169,897 165,439
Transaction costs 569 195
Payroll and related costs from management services contracts 2,159 2,219
General and administrative expense 32,797 27,683
Less:
Interest and other income 4,393 3,774
Gains (losses) from investments in securities 2,177 (3,319 )
Gains (losses) on sales of real estate (57 ) 59,804
Income (loss) from unconsolidated joint ventures (936 ) 5,305
Direct reimbursements of payroll and related costs from management services contracts 2,159 2,219
Development and management services revenue 10,473 12,195
Net Operating Income (NOI) 467,632 429,479
Add:
BXP’s share of NOI from unconsolidated joint ventures ^1^ 24,587 24,814
Less:
Partners’ share of NOI from consolidated joint ventures (after priority allocations and income allocation to private REIT shareholders) ^2^ 45,093 45,369
BXP’s Share of NOI 447,126 408,924
Less:
Termination income 1,397 4,775
BXP’s share of termination income from unconsolidated joint ventures ^1^ — 27
Add:
Partners’ share of termination income from consolidated joint ventures ^2^ — 115
BXP’s Share of NOI (excluding termination income) $ 445,729 $ 404,237
Net Operating Income (NOI) $ 467,632 $ 429,479
Less:
Termination income 1,397 4,775
NOI from non Same Properties (excluding termination income) ^3^ 37,263 16,513
Same Property NOI (excluding termination income) 428,972 408,191
Less:
Partners’ share of NOI from consolidated joint ventures (excluding termination income and after priority allocations and income allocation to private REIT shareholders) ^2^ 45,093 45,254
Add:
Partners’ share of NOI from non Same Properties from consolidated joint ventures (excluding termination income and after priority allocations and income allocation to private REIT shareholders) ^3^ 206 449
BXP’s share of NOI from unconsolidated joint ventures (excluding termination income) ^1^ 24,587 24,787
Less:
BXP’s share of NOI from non Same Properties from unconsolidated joint ventures (excluding termination income) ^3^ 2,144 1,775
BXP’s Share of Same Property NOI (excluding termination income) $ 406,528 $ 386,398

_____________

^1^ For a quantitative reconciliation for the three months ended December 31, 2019, see page 63.
^2^ For a quantitative reconciliation for the three months ended December 31, 2019, see page 60.
--- ---
^3^ Pages 21-24 indicate by footnote the properties that are not included as part of Same Property NOI. In addition, Same Properties exclude properties that were sold prior to December 31, 2019 and therefore are no longer a part of the Company’s property portfolio.
--- ---

9

Q4 2019
Reconciliation of net income attributable to Boston Properties, Inc. common shareholders to BXP’s Share of same property net operating income (NOI) - cash
(in thousands) Three Months Ended
31-Dec-19 31-Dec-18
Net income attributable to Boston Properties, Inc. common shareholders $ 140,824 $ 148,529
Preferred dividends 2,625 2,625
Net income attributable to Boston Properties, Inc. 143,449 151,154
Net income attributable to noncontrolling interests:
Noncontrolling interest - common units of the Operating Partnership 16,222 17,662
Noncontrolling interest in property partnerships 16,338 16,425
Net income 176,009 185,241
Add:
Interest expense 102,880 100,378
Losses from early extinguishments of debt 1,530 16,490
Impairment loss — 11,812
Depreciation and amortization expense 169,897 165,439
Transaction costs 569 195
Payroll and related costs from management services contracts 2,159 2,219
General and administrative expense 32,797 27,683
Less:
Interest and other income 4,393 3,774
Gains (losses) from investments in securities 2,177 (3,319 )
Gains (losses) on sales of real estate (57 ) 59,804
Income (loss) from unconsolidated joint ventures (936 ) 5,305
Direct reimbursements of payroll and related costs from management services contracts 2,159 2,219
Development and management services revenue 10,473 12,195
Net Operating Income (NOI) 467,632 429,479
Less:
Straight-line rent 40,460 1,830
Fair value lease revenue 2,965 6,076
Termination income 1,397 4,775
Add:
Straight-line ground rent expense adjustment ^1^ 843 887
Lease transaction costs that qualify as rent inducements ^2^ 2,170 3,989
NOI - cash (excluding termination income) 425,823 421,674
Less:
NOI - cash from non Same Properties (excluding termination income) ^3^ 31,389 24,316
Same Property NOI - cash (excluding termination income) 394,434 397,358
Less:
Partners’ share of NOI - cash from consolidated joint ventures (excluding termination income and after priority allocations and income allocation to private REIT shareholders) ^4^ 41,197 43,416
Add:
Partners’ share of NOI - cash from non Same Properties from consolidated joint ventures (excluding termination income and after priority allocations and income allocation to private REIT shareholders) ^3^ 273 854
BXP’s share of NOI - cash from unconsolidated joint ventures (excluding termination income) ^5^ 24,590 20,458
Less:
BXP’s share of NOI - cash from non Same Properties from unconsolidated joint ventures (excluding termination income) ^3^ 5,012 1,641
BXP’s Share of Same Property NOI - cash (excluding termination income) $ 373,088 $ 373,613

_____________

^1^ In light of the front-ended, uneven rental payments required by the Company’s 99-year ground and air rights lease for the 100 Clarendon Street garage and Back Bay Transit Station in Boston, MA, and to make period-to-period comparisons more meaningful to investors, the adjustment does not include the straight-line impact of approximately $173 and $168 for the three months ended December 31, 2019 and 2018, respectively. As of December 31, 2019, the Company has remaining lease payments aggregating approximately $26.0 million, all of which it expects to incur by the end of 2023 with no payments thereafter. Under GAAP, the Company recognizes expense of $(87) per quarter on a straight-line basis over the term of the lease. However, unlike more traditional ground and air rights leases, the timing and amounts of the rental payments by the Company correlate to the uneven timing and funding by the Company of capital expenditures related to improvements at Back Bay Transit Station. As a result, the amounts excluded from the adjustment each quarter through 2023 may vary significantly.
^2^ Consists of lease transaction costs that qualify as rent inducements in accordance with GAAP. Lease transaction costs are generally included in 2nd generation tenant improvements and leasing commissions in the Company’s FAD calculation on page 8.
--- ---
^3^ Pages 21-24 indicate by footnote the properties that are not included as part of Same Property NOI. In addition, Same Properties exclude properties that were sold prior to December 31, 2019 and therefore are no longer a part of the Company’s property portfolio.^^
--- ---
^4^ For a quantitative reconciliation for the three months ended December 31, 2019, see page 60.
--- ---
^5^ For a quantitative reconciliation for the three months ended December 31, 2019, see page 63.
--- ---

10

Q4 2019
Same property net operating income (NOI) by reportable segment

(dollars in thousands)

Office ^1^ Hotel & Residential
Three Months Ended % Three Months Ended %
31-Dec-19 31-Dec-18 Change Change 31-Dec-19 31-Dec-18 Change Change
Rental Revenue ^2^ $ 665,553 $ 640,568 $ 21,996 $ 19,018
Less: Termination income 1,397 4,421 — —
Rental revenue (excluding termination income) ^2^ 664,156 636,147 4.4 % 21,996 19,018 15.7 %
Less: Operating expenses and real estate taxes 244,784 235,058 9,726 4.1 % 12,396 11,916 480 4.0 %
NOI (excluding termination income) ^2,^ ^3^ $ 419,372 $ 401,089 4.6 % $ 9,600 $ 7,102 35.2 %
Rental revenue (excluding termination income) ^2^ $ 664,156 $ 636,147 4.4 % $ 21,996 $ 19,018 15.7 %
Less: Straight-line rent and fair value lease revenue 37,404 15,234 22,170 145.5 % 147 18 129 716.7 %
Add: Lease transaction costs that qualify as rent inducements ^4^ 2,170 3,532 (1,362 ) (38.6 )% — — — — %
Subtotal 628,922 624,445 4,477 0.7 % 21,849 19,000 2,849 15.0 %
Less: Operating expenses and real estate taxes 244,784 235,058 9,726 4.1 % 12,396 11,916 480 4.0 %
Add: Straight-line ground rent expense ^5^ 843 887 (44 ) (5.0 )% — — — — %
NOI - cash (excluding termination income) ^2,^ ^3^ $ 384,981 $ 390,274 ) (1.4 )% $ 9,453 $ 7,084 33.4 %
Consolidated Total ^1^(A) BXP’s share of Unconsolidated Joint Ventures (B)
Three Months Ended % Three Months Ended %
31-Dec-19 31-Dec-18 Change Change 31-Dec-19 31-Dec-18 Change Change
Rental Revenue ^2^ $ 687,549 $ 659,586 $ 35,752 $ 35,224
Less: Termination income 1,397 4,421 — 25
Rental revenue (excluding termination income) ^2^ 686,152 655,165 4.7 % 35,752 35,199 1.6 %
Less: Operating expenses and real estate taxes 257,180 246,974 10,206 4.1 % 13,309 12,187 1,122 9.2 %
NOI (excluding termination income) ^2,^ ^3^ $ 428,972 $ 408,191 5.1 % $ 22,443 $ 23,012 ) (2.5 )%
Rental revenue (excluding termination income) ^2^ $ 686,152 $ 655,165 4.7 % $ 35,752 $ 35,199 1.6 %
Less: Straight-line rent and fair value lease revenue 37,551 15,252 22,299 146.2 % 5,361 4,574 787 17.2 %
Add: Lease transaction costs that qualify as rent inducements ^4^ 2,170 3,532 (1,362 ) (38.6 )% 2,496 379 2,117 558.6 %
Subtotal $ 650,771 $ 643,445 7,326 1.1 % 32,887 31,004 1,883 6.1 %
Less: Operating expenses and real estate taxes 257,180 246,974 10,206 4.1 % 13,309 12,187 1,122 9.2 %
Add: Straight-line ground rent expense ^5^ 843 887 (44 ) (5.0 )% — — — — %
NOI - cash (excluding termination income) ^2,^ ^3^ $ 394,434 $ 397,358 ) (0.7 )% $ 19,578 $ 18,817 4.0 %
Partners’ share of Consolidated Joint Ventures (C) BXP’s Share ^2,^ ^6^
Three Months Ended % Three Months Ended %
31-Dec-19 31-Dec-18 Change Change 31-Dec-19 31-Dec-18 Change Change
Rental Revenue ^2^ $ 74,548 $ 73,055 $ 648,753 $ 621,755
Less: Termination income — 115 1,397 4,331
Rental revenue (excluding termination income) ^2^ 74,548 72,940 2.2 % 647,356 617,424 4.8 %
Less: Operating expenses and real estate taxes 29,661 28,135 1,526 5.4 % 240,828 231,026 9,802 4.2 %
NOI (excluding termination income) ^2,^ ^3^ $ 44,887 $ 44,805 0.2 % $ 406,528 $ 386,398 5.2 %
Rental revenue (excluding termination income) ^2^ $ 74,548 $ 72,940 2.2 % $ 647,356 $ 617,424 4.8 %
Less: Straight-line rent and fair value lease revenue 4,131 2,413 1,718 71.2 % 38,781 17,413 21,368 122.7 %
Add: Lease transaction costs that qualify as rent inducements ^4^ 168 170 (2 ) (1.2 )% 4,498 3,741 757 20.2 %
Subtotal 70,585 70,697 (112 ) (0.2 )% 613,073 603,752 9,321 1.5 %
Less: Operating expenses and real estate taxes 29,661 28,135 1,526 5.4 % 240,828 231,026 9,802 4.2 %
Add: Straight-line ground rent expense ^5^ — — — — % 843 887 (44 ) (5.0 )%
NOI - cash (excluding termination income) ^2,^ ^3^ $ 40,924 $ 42,562 ) (3.8 )% $ 373,088 $ 373,613 ) (0.1 )%

All values are in US Dollars.

___________________

^1^ Includes 100% share of consolidated joint ventures that are a Same Property.
^2^ See the Definitions and Reconciliations sections of this Supplemental package starting on page 54.
--- ---
^3^ For a quantitative reconciliation of net income attributable to Boston Properties, Inc. common shareholders to net operating income (NOI) (excluding termination income) and NOI - cash (excluding termination income), see pages 9-10.
--- ---
^4^ Consists of lease transaction costs that qualify as rent inducements in accordance with GAAP. Lease transaction costs are generally included in 2nd generation tenant improvements and leasing commissions in the Company’s FAD calculation on page 8.
--- ---
^5^ Excludes the straight-line impact of approximately $173 and $168 for the three months ended December 31, 2019 and 2018, respectively, in connection with the Company’s 99-year ground and air rights lease at 100 Clarendon Street garage and Back Bay Transit Station. For additional information, see page 10.
--- ---
^6^ BXP’s Share equals (A) + (B) - (C).
--- ---

11

Q4 2019
Capital expenditures, tenant improvement costs and leasing commissions

(dollars in thousands, except PSF amounts)

CAPITAL EXPENDITURES
Three Months Ended
31-Dec-19 30-Sep-19
Maintenance capital expenditures $ 25,818 $ 31,140
Planned capital expenditures associated with acquisition properties — —
Repositioning capital expenditures 8,141 3,630
Hotel improvements, equipment upgrades and replacements 148 177
Subtotal 34,107 34,947
Add:
BXP’s share of maintenance capital expenditures from unconsolidated joint ventures (JVs) 637 671
BXP’s share of planned capital expenditures associated with acquisition properties from unconsolidated JVs 472 666
BXP’s share of repositioning capital expenditures from unconsolidated JVs 2,024 1,548
Less:
Partners’ share of maintenance capital expenditures from consolidated JVs 998 548
Partners’ share of planned capital expenditures associated with acquisition properties from consolidated JVs — —
Partners’ share of repositioning capital expenditures from consolidated JVs 3,174 1,145
BXP’s Share of Capital Expenditures ^1^ $ 33,068 $ 36,139
2nd GENERATION TENANT IMPROVEMENTS AND LEASING COMMISSIONS ^2^
--- --- --- --- ---
Three Months Ended
31-Dec-19 30-Sep-19
Square feet 1,100,745 1,516,332
Tenant improvements and lease commissions PSF $ 83.30 $ 84.97

___________________

^1^ See the Definitions and Reconciliations sections of this Supplemental package starting on page 54.
^2^ Includes 100% of unconsolidated joint ventures.
--- ---

12

Q4 2019
Acquisitions and dispositions

For the period from January 1, 2019 through December 31, 2019

(dollars in thousands)

ACQUISITIONS
Investment
Property Location Date Acquired Square Feet Initial Anticipated Future Total Leased (%)
Carnegie Center (land parcels) Princeton, NJ January 10, 2019 N/A $ 42,949 $ 8,581 $ 51,530 N/A
Salesforce Tower (remaining 5% ownership interest) ^1^ San Francisco, CA April 1, 2019 1,420,682 186,843 — 186,843 99.3 %
880 and 890 Winter Street Waltham, MA August 27, 2019 392,400 106,000 20,000 126,000 84.1 %
Total Acquisitions 1,813,082 $ 335,792 $ 28,581 $ 364,373 96.0 %
DISPOSITIONS
--- --- --- --- --- --- --- --- --- --- ---
Property Location Date Disposed Square Feet Gross Sales Price Net Cash Proceeds Book Gain (Loss) ^2^
2600 Tower Oaks Boulevard Rockville, MD January 24, 2019 179,421 $ 22,650 $ 21,408 $ (573 )
One Tower Center East Brunswick, NJ June 3, 2019 410,310 38,000 36,550 (807 )
540 Madison Avenue (60% ownership interest) ^3^ New York, NY June 27, 2019 283,727 310,301 107,103 47,238
164 Lexington Road Billerica, MA June 28, 2019 64,140 4,000 3,849 2,498
Platform 16 (45% ownership interest) ^4^ San Jose, CA September 20, 2019 N/A 23,103 23,103 —
Washingtonian North (land parcel Gaithersburg, MD December 20, 2019 N/A 7,775 7,338 (57 )
Total Dispositions 937,598 $ 405,829 $ 199,351 $ 48,299

________________

^1^ Consists of the acquisition of the partner's 5% ownership interest and promoted profits interest for cash totaling approximately $210.9 million, which amount was reduced by approximately $24.1 million to $186.8 million to reflect the repayment of the Company's preferred equity and preferred return in the venture. The partner was entitled to receive an additional promoted payment based on the success of the property, which was included in the total consideration.
^2^ Excludes approximately $0.4 million of losses on sales of real estate recognized during the year ended December 31, 2019 related to loss amounts from sales of real estate occurring in prior years.
--- ---
^3^ The gross sale price of approximately $310.3 million includes the assumption by the buyer of the mortgage loan collateralized by the property totaling $120.0 million. Net cash proceeds totaled approximately $178.7 million, of which the Company’s share was approximately $107.1 million, net of transaction costs. The Company’s share of the gain on sale of real estate totaling approximately $47.2 million is included in Income from Unconsolidated Joint Ventures in the Company’s Consolidated Statements of Operations.
--- ---
^4^ On September 20, 2019, the Company entered into a joint venture with Canada Pension Plan Investment Board (“CPPIB”) to develop Platform 16 located in San Jose. The Company contributed the ground lease interest and improvements totaling approximately $28.2 million for its initial 55% interest in the joint venture. CPPIB contributed cash totaling approximately $23.1 million for its initial 45% interest in the joint venture. The Company did not recognize a gain on the retained or sold interest in the real estate contributed to the joint venture as the fair value of the real estate approximated its carrying value.
--- ---

13

Q4 2019
Construction in progress

as of December 31, 2019

(dollars in thousands)

CONSTRUCTION IN PROGRESS ^1^
Actual/Estimated BXP’s share
Estimated Total Investment ^2^ Amount Drawn at Estimated Future Equity Requirement ^2^ Percentage placed in-service ^4^ Net Operating Income (Loss) ^5^(BXP’s share)
Initial Occupancy Stabilization Date Square Feet Investment to Date ^2^ Total Financing Percentage Leased ^3^
Construction Properties Location 12/31/19
Office and Retail
17Fifty Presidents Street Q2 2020 Q2 2020 Reston, VA 276,000 $ 118,441 $ 142,900 $ — $ — $ 24,459 100 % — % N/A
20 CityPoint Q3 2019 Q1 2021 Waltham, MA 211,000 77,966 97,000 — — 19,034 63 % 65 % 1,173
Dock 72 (50% ownership) Q4 2019 Q3 2021 Brooklyn, NY 670,000 195,908 243,150 125,000 86,887 9,129 33 % 34 % 810
325 Main Street Q3 2022 Q3 2022 Cambridge, MA 420,000 89,099 418,400 — — 329,301 90 % — % N/A
100 Causeway Street (50% ownership) Q2 2021 Q3 2022 Boston, MA 632,000 114,584 267,300 200,000 — 40,553 — 94 % — % N/A
7750 Wisconsin Avenue (Marriott International Headquarters) (50% ownership) Q3 2022 Q3 2022 Bethesda, MD 734,000 94,978 198,900 127,500 32,228 8,650 100 % — % N/A
Reston Gateway Q4 2022 Q4 2023 Reston, VA 1,062,000 159,881 715,300 — — 555,419 80 % — % N/A
2100 Pennsylvania Avenue Q3 2022 Q3 2024 Washington, DC 469,000 66,400 356,100 — — 289,700 61 % — % N/A
Total Office Properties under Construction 4,474,000 $ 917,257 $ 2,439,050 $ 452,500 $ 159,668 $ 1,235,692 78 % 13 % $ 1,983
Residential
Hub50House (The Hub on Causeway - Residential) (440 units) (50% ownership) Q4 2019 Q4 2021 Boston, MA 320,000 $ 134,853 $ 153,500 $ 90,000 $ 70,594 $ — 35 % 43 % (114 )
The Skylyne (MacArthur Station Residences) (402 units) ^6^ Q2 2020 Q4 2021 Oakland, CA 324,000 197,383 263,600 — — 66,217 — — % N/A
Total Residential Properties under Construction 644,000 $ 332,236 $ 417,100 $ 90,000 $ 70,594 $ 66,217 35 % 18 % $ (114 )
Redevelopment Properties
One Five Nine East 53rd (55% ownership) Q1 2020 Q3 2020 New York, NY 220,000 $ 132,008 $ 150,000 $ — $ — $ 17,992 96 % — % N/A
200 West Street ^7^ Q1 2021 Q4 2021 Waltham, MA 126,000 2,104 47,800 — — 45,696 — % — % N/A
Total Redevelopment Properties under Construction 346,000 $ 134,112 $ 197,800 $ — $ — $ 63,688 61 % — % N/A
Total Properties Under Construction and Redevelopment 5,464,000 $ 1,383,605 $ 3,053,950 $ 542,500 $ 230,262 $ 1,365,597 76 % ^8^ 13 % $ 1,869

14

Q4 2019
Construction in progress (continued)
PROJECTS FULLY PLACED IN-SERVICE DURING 2019
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Actual/Estimated BXP’s share
Estimated Total Investment ^2^ Amount Drawn at Estimated Future Equity Requirement ^2^ Net Operating Income (Loss) ^5^(BXP’s share)
Initial Occupancy Stabilization Date Square feet Investment to Date ^2^ Total Financing Percentage Leased ^3^
Location 12/31/19
The Hub on Causeway - Podium (50% ownership) Q2 2019 Q4 2019 Boston, MA 382,497 $ 136,989 $ 141,870 $ 87,900 $ 79,324 $ — 99 % $ 1,538
145 Broadway Q4 2019 Q4 2019 Cambridge, MA 483,482 307,764 346,200 — — 38,436 98 % 7,170
Total Projects Fully Placed In-Service 865,979 $ 444,753 $ 488,070 $ 87,900 $ 79,324 $ 38,436 98 % $ 8,708

_____________

^1^ A project is classified as Construction in Progress when (1) construction or supply contracts have been signed, physical improvements have commenced or a lease has been signed and (2) capitalized interest has commenced.
^2^ Includes income (loss) and interest carry on debt and equity investment.
--- ---
^3^ Represents percentage leased as of January 24, 2020, including leases with future commencement dates.
--- ---
^4^ Represents the portion of the project that no longer qualifies for capitalization of interest in accordance with GAAP.
--- ---
^5^ Amounts represent Net Operating Income (Loss) for the three months ended December 31, 2019. See the Definitions and Reconciliations sections of this Supplemental package starting on page 54.
--- ---
^6^ This development is subject to a 99-year ground lease (including extension options) with an option to purchase in the future.
--- ---
^7^ Represents a portion of the property under redevelopment for conversion to laboratory space.
--- ---
^8^ Excludes residential units.
--- ---

15

Q4 2019
Land parcels and purchase options

as of December 31, 2019

OWNED LAND PARCELS
Location Approximate Developable Square Feet ^1^
San Jose, CA ^2^ 2,199,000
San Jose, CA (55% ownership) ^3^ 1,078,000
Reston, VA 3,137,000
New York, NY (25% ownership) 2,000,000
Princeton, NJ 1,650,000
Waltham, MA 605,000
Washington, DC (50% ownership) 520,000
Springfield, VA 422,000
Santa Clara, CA ^2^ 414,000
Marlborough, MA 400,000
Dulles, VA 310,000
Annapolis, MD (50% ownership) 300,000
Total 13,035,000
VALUE CREATION PIPELINE - LAND PURCHASE OPTIONS
--- --- ---
Location Approximate Developable Square Feet ^1^
Boston, MA 1,300,000
San Francisco, CA 820,000
Cambridge, MA 330,000
Total 2,450,000

__________________

^1^ Represents 100%.
^2^ Excludes the existing square footage at in-service properties being held for future re-development as listed and noted on page 23.
--- ---
^3^ Subject to a 65-year ground lease with an option to purchase in the future.
--- ---

16

Q4 2019
Leasing activity

for the three months ended December 31, 2019

ALL IN-SERVICE PROPERTIES
Net (increase)/decrease in available space (SF) Total
Vacant space available at the beginning of the period 3,285,955
Add:
Properties placed (and partially placed) in-service ^1^ 851,145
Leases expiring or terminated during the period 913,118
Total space available for lease 5,050,218
1st generation leases 814,303
2nd generation leases with new tenants 645,665
2nd generation lease renewals 455,080
Total space leased 1,915,048
Vacant space available for lease at the end of the period 3,135,170
Net (increase)/decrease in available space 150,785
Second generation leasing information: ^2^
Leases commencing during the period (SF) 1,100,745
Weighted average lease term (months) 105
Weighted average free rent period (days) 96
Total transaction costs per square foot ^3^ 83.30
Increase (decrease) in gross rents ^4^ 28.58
Increase (decrease) in net rents ^5^ 47.50

All values are in US Dollars.

All leases (SF) Incr (decr) in 2nd generation cash rents Total square feet of leases executed in the quarter ^7^
1st generation 2nd generation total ^6^ gross ^4^ net ^5^
Boston 588,720 412,387 1,001,107 49.91 % 78.77 % 317,216
Los Angeles — 3,787 3,787 (38.04 )% (81.35 )% 277,094
New York 221,607 315,737 537,344 8.47 % 16.86 % 401,116
San Francisco 3,976 236,844 240,820 43.85 % 57.03 % 82,579
Washington, DC — 131,990 131,990 (1.54 )% (1.17 )% 637,727
Total / Weighted Average 814,303 1,100,745 1,915,048 28.58 % 47.50 % 1,715,732

_____________

^1^ Total square feet of properties placed (and partially placed) in-service in Q4 2019 consists of 146,056 at The Hub on Causeway - Podium, 221,607 at Dock 72 and 483,482 at 145 Broadway.
^2^ Second generation leases are defined as leases for space that had previously been leased by the Company. Of the 1,100,745 square feet of second generation leases that commenced in Q4 2019, leases for 939,017 square feet were signed in prior periods.
--- ---
^3^ Total transaction costs include tenant improvements and leasing commissions, but exclude free rent concessions.
--- ---
^4^ Represents the increase/(decrease) in gross rent (base rent plus expense reimbursements) on the new vs. expired leases on the 826,323 square feet of second generation leases that had been occupied within the prior 12 months; excludes leases that management considers temporary because the tenant is not expected to occupy the space on a long-term basis (e.g., the tenant is occupying “swing space”).
--- ---
^5^ Represents the increase/(decrease) in net rent (gross rent less operating expenses) on the new vs. expired leases on the 826,323 square feet of second generation leases that had been occupied within the prior 12 months; excludes leases that management considers temporary because the tenant is not expected to occupy the space on a long-term basis (e.g., the tenant is occupying “swing space”).
--- ---
^6^ Represents leases for which rental revenue recognition commenced in accordance with GAAP during the quarter.
--- ---
^7^ Represents leases executed in the quarter for which the Company either (1) commenced rental revenue recognition in such quarter or (2) will commence rental revenue recognition in subsequent quarters, in accordance with GAAP, and includes leases at properties currently under development. The total square feet of leases executed in the current quarter for which the Company recognized rental revenue in the current quarter is 161,728.
--- ---

17

Q4 2019
Portfolio overview

for the three months ended December 31, 2019

(dollars in thousands)

Rentable square footage of in-service properties by location and unit type ^1, 2^
Office Retail Residential Hotel Total
Boston 13,574,494 1,098,556 229,670 330,000 15,232,720
Los Angeles 2,180,263 124,770 — — 2,305,033
New York 10,469,868 418,373 — — 10,888,241
San Francisco 7,188,714 318,153 — — 7,506,867
Washington, DC 9,076,225 673,154 822,436 — 10,571,815
Total 42,489,564 2,633,006 1,052,106 330,000 46,504,676
% of Total 91.37 % 5.66 % 2.26 % 0.71 % 100.00 %
Rental revenue of in-service properties by unit type ^1^
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Office Retail Residential Hotel ^3^ Total
Consolidated $ 670,580 $ 53,134 $ 9,448 $ 11,707 $ 744,869
Less:
Partners’ share from consolidated joint ventures ^4^ 68,815 6,163 — — 74,978
Add:
BXP’s share from unconsolidated joint ventures ^5^ 37,516 2,310 317 — 40,143
BXP’s Share of Rental revenue ^1^ $ 639,281 $ 49,281 $ 9,765 $ 11,707 $ 710,034
% of Total 90.03 % 6.94 % 1.38 % 1.65 % 100.00 %
Percentage of BXP’s Share of net operating income (NOI) (excluding termination income) by location ^1,^ ^6^
--- --- --- --- --- --- ---
CBD Suburban Total
Boston 26.39 % 6.99 % 33.38 %
Los Angeles 3.47 % — % 3.47 %
New York 23.91 % 2.67 % 26.58 %
San Francisco 17.94 % 3.15 % 21.09 %
Washington, DC 6.25 % 9.23 % 15.48 %
Total 77.96 % 22.04 % 100.00 %

_____________

^1^ See the Definitions and Reconciliations sections of this Supplemental package starting on page 54.
^2^ Includes 100% of the rentable square footage of the Company’s In-Service Properties. For additional detail relating to the Company’s In-Service Properties, see pages 21-24.
--- ---
^3^ Excludes approximately $86 of revenue from retail tenants that is included in Retail.
--- ---
^4^ See page 60 for additional information.
--- ---
^5^ See page 63 for additional information.
--- ---
^6^ BXP’s Share of NOI (excluding termination income) is a non-GAAP financial measure. For a quantitative reconciliation of net income attributable to Boston Properties, Inc. common shareholders to BXP’s Share of NOI (excluding termination income), see page 9.
--- ---

18

Q4 2019
Residential and hotel performance

(dollars in thousands)

RESULTS OF OPERATIONS
Residential ^1^ Hotel
Three Months Ended Three Months Ended
31-Dec-19 30-Sep-19 31-Dec-19 30-Sep-19
Rental Revenue ^2^ $ 10,203 $ 9,996 $ 11,793 $ 13,014
Less: Operating expenses and real estate taxes 4,078 4,011 8,318 8,743
Net Operating Income (NOI) ^2^ 6,125 5,985 3,475 4,271
Add: BXP’s share of NOI from unconsolidated joint ventures (114 ) N/A N/A N/A
BXP’s Share of NOI ^2^ $ 6,011 $ 5,985 $ 3,475 $ 4,271
Rental Revenue ^2^ $ 10,203 $ 9,996 $ 11,793 $ 13,014
Less: Straight line rent and fair value lease revenue 153 65 (6 ) (6 )
Subtotal 10,050 9,931 11,799 13,020
Less: Operating expenses and real estate taxes 4,078 4,011 8,318 8,743
NOI - cash basis ^2^ 5,972 5,920 3,481 4,277
Add: BXP’s share of NOI-cash from unconsolidated joint ventures (114 ) N/A N/A N/A
BXP’s Share of NOI - cash basis ^2^ $ 5,858 $ 5,920 $ 3,481 $ 4,277
RENTAL RATES AND OCCUPANCY - Year-over-Year
--- --- --- --- --- --- --- --- ---
Three Months Ended Percent
31-Dec-19 31-Dec-18 Change
The Avant at Reston Town Center (359 units), Reston, VA ^2, 3^
Average Monthly Rental Rate $ 2,465 $ 2,435 1.23 %
Average Rental Rate Per Occupied Square Foot $ 2.70 $ 2.66 1.50 %
Average Physical Occupancy 90.71 % 90.90 % (0.21 )%
Average Economic Occupancy 90.19 % 90.64 % (0.50 )%
The Lofts at Atlantic Wharf (86 units), Boston, MA ^2, 3^
Average Monthly Rental Rate $ 4,516 $ 4,394 2.78 %
Average Rental Rate Per Occupied Square Foot $ 5.02 $ 4.83 3.93 %
Average Physical Occupancy 95.35 % 96.12 % (0.80 )%
Average Economic Occupancy 95.12 % 96.29 % (1.22 )%
Signature at Reston (508 units), Reston, VA ^2, 3, 4^
Average Monthly Rental Rate $ 2,372 $ 2,241 5.85 %
Average Rental Rate Per Occupied Square Foot $ 2.56 $ 2.49 2.81 %
Average Physical Occupancy 77.30 % 45.47 % 70.00 %
Average Economic Occupancy 71.52 % 38.63 % 85.14 %
Proto Kendall Square (280 units), Cambridge, MA ^2, 3^
Average Monthly Rental Rate $ 3,013 $ 2,655 13.48 %
Average Rental Rate Per Occupied Square Foot $ 5.54 $ 4.91 12.83 %
Average Physical Occupancy 97.50 % 51.90 % 87.86 %
Average Economic Occupancy 97.50 % 47.33 % 106.00 %
Hub50House (440 units) (50% ownership), Boston, MA ^2, 5^
Average Monthly Rental Rate $ 3,101 N/A N/A
Average Rental Rate Per Occupied Square Foot $ 5.21 N/A N/A
Average Physical Occupancy 17.35 % N/A N/A
Average Economic Occupancy 12.95 % N/A N/A
Boston Marriott Cambridge (437 rooms), Cambridge, MA ^3^
Average Occupancy 75.20 % 75.40 % (0.27 )%
Average Daily Rate $ 284.40 $ 295.06 (3.61 )%
Revenue Per Available Room $ 290.09 $ 290.00 0.03 %

19

Q4 2019
Residential and hotel performance (continued)

_____________

^1^ Includes retail space.
^2^ See the Definitions and Reconciliations sections of this Supplemental package starting on page 54.
--- ---
^3^ Excludes retail space.
--- ---
^4^ This property was completed and fully placed in-service on June 7, 2018 and is in its initial lease-up period with expected stabilization in the second quarter of 2020.
--- ---
^5^ This property was 43% placed in-service at December 31, 2019.
--- ---

20

Q4 2019
In-service property listing

as of December 31, 2019

Sub Market Number of Buildings Square Feet Leased % ^1^ Annualized Rental Obligations Per Leased SF ^2^
BOSTON
Office
200 Clarendon Street CBD Boston MA 1 1,766,534 96.7 % $ 70.71
100 Federal Street (55% ownership) CBD Boston MA 1 1,238,461 98.2 % 63.40
800 Boylston Street - The Prudential Center CBD Boston MA 1 1,235,538 98.2 % 63.57
111 Huntington Avenue - The Prudential Center CBD Boston MA 1 860,455 100.0 % 67.16
Atlantic Wharf Office (55% ownership) CBD Boston MA 1 793,823 100.0 % 72.42
Prudential Center (retail shops) ^3^ CBD Boston MA 1 595,212 99.0 % 89.63
101 Huntington Avenue - The Prudential Center CBD Boston MA 1 506,476 100.0 % 52.25
The Hub on Causeway - Podium (50% ownership) ^4, 5^ CBD Boston MA 1 382,497 91.3 % 59.85
888 Boylston Street - The Prudential Center CBD Boston MA 1 363,320 100.0 % 75.92
Star Market at the Prudential Center ^3^ CBD Boston MA 1 57,235 100.0 % 59.70
Subtotal 10 7,799,551 98.2 % $ 68.16
145 Broadway ^5^ East Cambridge MA 1 483,482 98.4 % $ 81.12
355 Main Street East Cambridge MA 1 259,640 96.3 % 74.17
90 Broadway East Cambridge MA 1 223,771 100.0 % 67.86
255 Main Street East Cambridge MA 1 215,394 100.0 % 80.21
300 Binney Street East Cambridge MA 1 195,191 100.0 % 58.64
150 Broadway East Cambridge MA 1 177,226 100.0 % 68.30
105 Broadway East Cambridge MA 1 152,664 100.0 % 69.26
250 Binney Street East Cambridge MA 1 67,362 100.0 % 46.26
University Place Mid-Cambridge MA 1 195,282 100.0 % 52.08
Subtotal 9 1,970,012 99.1 % $ 70.16
Bay Colony Corporate Center Route 128 Mass Turnpike MA 4 999,131 85.8 % $ 44.85
Reservoir Place Route 128 Mass Turnpike MA 1 526,985 89.6 % 37.19
880 & 890 Winter Street ^5^ Route 128 Mass Turnpike MA 2 392,400 84.1 % 40.82
140 Kendrick Street Route 128 Mass Turnpike MA 3 380,987 100.0 % 37.18
Weston Corporate Center Route 128 Mass Turnpike MA 1 356,995 100.0 % 53.13
Waltham Weston Corporate Center Route 128 Mass Turnpike MA 1 301,607 91.6 % 38.96
230 CityPoint Route 128 Mass Turnpike MA 1 296,212 89.9 % 40.59
10 CityPoint Route 128 Mass Turnpike MA 1 241,199 98.1 % 51.77
77 CityPoint Route 128 Mass Turnpike MA 1 209,708 91.9 % 49.49
200 West Street ^5, 6^ Route 128 Mass Turnpike MA 1 134,917 100.0 % 38.76
1265 Main Street (50% ownership) ^4^ Route 128 Mass Turnpike MA 1 114,969 100.0 % 45.12
Reservoir Place North Route 128 Mass Turnpike MA 1 73,258 100.0 % 44.50
195 West Street Route 128 Mass Turnpike MA 1 63,500 — % —
The Point ^3^ Route 128 Mass Turnpike MA 1 16,300 84.7 % 56.33
191 Spring Street ^5^ Route 128 Northwest MA 1 170,997 100.0 % 45.54
Lexington Office Park Route 128 Northwest MA 2 166,775 72.7 % 30.82
201 Spring Street Route 128 Northwest MA 1 106,300 100.0 % 44.06
33 Hayden Avenue Route 128 Northwest MA 1 80,872 100.0 % 65.46
32 Hartwell Avenue Route 128 Northwest MA 1 69,154 100.0 % 29.06
100 Hayden Avenue Route 128 Northwest MA 1 55,924 100.0 % 44.81
181 Spring Street Route 128 Northwest MA 1 55,793 100.0 % 42.12
92 Hayden Avenue Route 128 Northwest MA 1 31,100 100.0 % 43.34
17 Hartwell Avenue Route 128 Northwest MA 1 30,000 100.0 % 46.54
Subtotal 30 4,875,083 90.8 % $ 43.27
Boston Office Total: 49 14,644,646 95.9 % $ 60.54
Residential
Proto Kendall Square (280 units) East Cambridge MA 1 166,717
The Lofts at Atlantic Wharf (86 units) CBD Boston MA 1 87,097
Boston Residential Total: 2 253,814

21

Q4 2019
In-service property listing (continued)

as of December 31, 2019

Sub Market Number of Buildings Square Feet Leased % ^1^ Annualized Rental Obligations Per Leased SF ^2^
BOSTON (continued)
Hotel
Boston Marriott Cambridge (437 rooms) East Cambridge MA 1 334,260
Boston Hotel Total: 1 334,260
Boston Total: 52 15,232,720
LOS ANGELES
Office
Colorado Center (50% ownership) ^4^ West Los Angeles CA 6 1,128,600 100.0 % $ 68.14
Santa Monica Business Park (55% ownership) ^4^ West Los Angeles CA 14 1,102,191 93.5 % 56.34
Santa Monica Business Park Retail (55% ownership) ^3, 4^ West Los Angeles CA 7 74,242 92.3 % 63.24
Subtotal 27 2,305,033 96.7 % $ 62.56
Los Angeles Total: 27 2,305,033 96.7 % $ 62.56
NEW YORK
Office
767 Fifth Avenue (The GM Building) (60% ownership) Plaza District NY 1 1,968,613 89.9 % $ 142.91
399 Park Avenue Park Avenue NY 1 1,575,809 89.1 % 99.22
601 Lexington Avenue (55% ownership) Park Avenue NY 1 1,444,272 100.0 % 99.37
599 Lexington Avenue Park Avenue NY 1 1,062,916 98.2 % 92.42
Times Square Tower (55% ownership) Times Square NY 1 1,248,902 94.7 % 81.37
250 West 55th Street Times Square / West Side NY 1 966,965 98.6 % 95.21
510 Madison Avenue Fifth/Madison Avenue NY 1 355,083 96.4 % 138.83
Subtotal 7 8,622,560 94.4 % $ 106.47
510 Carnegie Center Princeton NJ 1 234,160 100.0 % $ 37.28
206 Carnegie Center Princeton NJ 1 161,763 100.0 % 34.18
210 Carnegie Center Princeton NJ 1 159,468 100.0 % 35.38
212 Carnegie Center Princeton NJ 1 151,547 67.5 % 33.91
214 Carnegie Center Princeton NJ 1 146,979 52.2 % 37.35
506 Carnegie Center Princeton NJ 1 140,312 66.0 % 36.19
508 Carnegie Center Princeton NJ 1 134,433 100.0 % 36.53
202 Carnegie Center Princeton NJ 1 134,381 93.5 % 38.96
804 Carnegie Center Princeton NJ 1 130,000 100.0 % 38.83
504 Carnegie Center Princeton NJ 1 121,990 100.0 % 33.06
101 Carnegie Center Princeton NJ 1 121,620 100.0 % 38.43
502 Carnegie Center Princeton NJ 1 121,460 94.8 % 36.29
701 Carnegie Center Princeton NJ 1 120,000 100.0 % 42.31
104 Carnegie Center Princeton NJ 1 102,830 55.1 % 35.98
103 Carnegie Center Princeton NJ 1 96,332 69.8 % 32.26
105 Carnegie Center Princeton NJ 1 69,955 56.3 % 34.40
302 Carnegie Center Princeton NJ 1 64,926 89.3 % 36.30
211 Carnegie Center Princeton NJ 1 47,025 100.0 % 37.08
201 Carnegie Center Princeton NJ — 6,500 100.0 % 37.03
Subtotal 18 2,265,681 87.0 % $ 36.56
New York Total: 25 10,888,241 92.9 % $ 92.83
SAN FRANCISCO
Office
Salesforce Tower ^5^ CBD San Francisco CA 1 1,420,682 99.3 % $ 98.90
Embarcadero Center Four CBD San Francisco CA 1 940,890 97.9 % 79.36
Embarcadero Center One CBD San Francisco CA 1 822,122 91.1 % 74.54
Embarcadero Center Two CBD San Francisco CA 1 791,712 94.9 % 75.62
Embarcadero Center Three CBD San Francisco CA 1 783,120 98.5 % 70.08
680 Folsom Street CBD San Francisco CA 2 524,793 100.0 % 66.41

22

Q4 2019
In-service property listing (continued)

as of December 31, 2019

Sub Market Number of Buildings Square Feet Leased % ^1^ Annualized Rental Obligations Per Leased SF ^2^
SAN FRANCISCO (continued)
535 Mission Street CBD San Francisco CA 1 307,235 100.0 % 81.96
690 Folsom Street CBD San Francisco CA 1 26,080 100.0 % 77.75
Subtotal 9 5,616,634 97.2 % $ 80.82
601 and 651 Gateway South San Francisco CA 2 509,899 74.5 % $ 44.81
611 Gateway South San Francisco CA 1 258,031 71.4 % 44.07
Mountain View Research Park Mountain View CA 15 542,289 90.1 % 63.38
2440 West El Camino Real Mountain View CA 1 141,392 87.2 % 75.33
453 Ravendale Drive Mountain View CA 1 29,620 85.8 % 47.46
3625-3635 Peterson Way ^7^ Santa Clara CA 1 218,366 100.0 % 23.60
North First Business Park ^7^ San Jose CA 5 190,636 81.1 % 25.72
Subtotal 26 1,890,233 83.3 % $ 48.11
San Francisco Total: 35 7,506,867 93.7 % $ 73.50
WASHINGTON, DC
Office
Metropolitan Square (20% ownership) ^4^ East End Washington DC 1 641,814 59.0 % $ 67.35
901 New York Avenue (25% ownership) ^4^ East End Washington DC 1 539,817 72.6 % 67.48
601 Massachusetts Avenue East End Washington DC 1 478,818 98.9 % 84.09
Market Square North (50% ownership) ^4^ East End Washington DC 1 417,768 79.5 % 68.57
Capital Gallery Southwest Washington DC 1 631,131 96.5 % 62.55
2200 Pennsylvania Avenue CBD Washington DC 1 458,831 100.0 % 97.08
1330 Connecticut Avenue CBD Washington DC 1 254,011 91.7 % 71.15
Sumner Square CBD Washington DC 1 208,892 91.8 % 54.64
500 North Capitol Street, N.W. (30% ownership) ^4^ Capitol Hill Washington DC 1 230,860 98.5 % 78.42
Subtotal 9 3,861,942 85.4 % $ 73.27
South of Market Reston VA 3 623,271 93.1 % $ 57.00
Fountain Square Reston VA 2 498,260 76.4 % 54.00
One Freedom Square Reston VA 1 432,585 92.7 % 53.28
Two Freedom Square Reston VA 1 421,757 100.0 % 51.58
One and Two Discovery Square Reston VA 2 366,990 97.2 % 48.95
One Reston Overlook Reston VA 1 319,519 100.0 % 43.16
Reston Corporate Center Reston VA 2 261,046 100.0 % 42.83
Democracy Tower Reston VA 1 259,441 100.0 % 56.96
Fountain Square Retail ^3^ Reston VA 1 220,503 90.1 % 54.37
Two Reston Overlook Reston VA 1 134,615 75.3 % 42.04
Subtotal 15 3,537,987 92.7 % $ 51.51
Wisconsin Place Office Montgomery County MD 1 299,186 90.0 % $ 56.84
New Dominion Technology Park - Building Two Herndon VA 1 257,400 100.0 % 38.61
New Dominion Technology Park - Building One Herndon VA 1 235,201 100.0 % 35.75
Kingstowne Two Springfield VA 1 156,089 63.3 % 37.10
Kingstowne One Springfield VA 1 151,483 89.6 % 39.26
7601 Boston Boulevard Springfield VA 1 114,028 100.0 % 19.31
7435 Boston Boulevard Springfield VA 1 103,557 83.4 % 24.09
8000 Grainger Court Springfield VA 1 88,775 — % —
Kingstowne Retail ^3^ Springfield VA 1 88,288 100.0 % 37.94
7500 Boston Boulevard Springfield VA 1 79,971 100.0 % 17.00
7501 Boston Boulevard Springfield VA 1 75,756 100.0 % 30.10
7450 Boston Boulevard Springfield VA 1 62,402 100.0 % 17.35
7374 Boston Boulevard Springfield VA 1 57,321 100.0 % 18.42
8000 Corporate Court Springfield VA 1 52,539 100.0 % 16.35
7451 Boston Boulevard Springfield VA 1 45,615 67.4 % 27.45
7300 Boston Boulevard Springfield VA 1 32,000 100.0 % 21.58
7375 Boston Boulevard Springfield VA 1 26,865 100.0 % 26.86

23

Q4 2019
In-service property listing (continued)

as of December 31, 2019

Sub Market Number of Buildings Square Feet Leased % ^1^ Annualized Rental Obligations Per Leased SF ^2^
WASHINGTON, DC (continued)
Annapolis Junction Building Seven (50% ownership) ^4^ Anne Arundel County MD 1 127,229 100.0 % 35.84
Annapolis Junction Building Eight (50% ownership) ^4^ Anne Arundel County MD 1 125,685 — % —
Annapolis Junction Building Six (50% ownership) ^4^ Anne Arundel County MD 1 119,339 75.2 % 30.77
Subtotal 20 2,298,729 83.5 % $ 34.65
Washington, DC Office Total: 44 9,698,658 87.6 % $ 56.11
Residential
Signature at Reston (508 units) Reston VA 1 517,783
The Avant at Reston Town Center (359 units) Reston VA 1 355,374
Washington, DC Residential Total: 2 873,157
Washington, DC Total: 46 10,571,815
Total In-Service Properties: 185 46,504,676 93.0 % ^8^ $ 69.72 ^8^

_____________

^1^ Represents signed leases for which revenue recognition has commenced in accordance with GAAP.
^2^ See the Definitions and Reconciliations sections of this Supplemental package starting on page 54.
--- ---
^3^ This is a retail property.
--- ---
^4^ This is an unconsolidated joint venture property.
--- ---
^5^ Not included in the Same Property analysis.
--- ---
^6^ During the three months ended September 30, 2019, the Company commenced the redevelopment of a portion of 200 West Street. For additional detail, see page 14.
--- ---
^7^ Property held for redevelopment.
--- ---
^8^ Excludes Hotel and Residential properties. For additional detail, see page 19.
--- ---

24

Q4 2019
Top 20 tenants listing and portfolio tenant diversification

as of December 31, 2019

TOP 20 TENANTS
No. Tenant BXP’s Share of Annualized Rental Obligations ^1^
1 salesforce.com 3.34 %
2 Arnold & Porter Kaye Scholer 2.67 %
3 Akamai Technologies 2.07 %
4 US Government 1.81 %
5 Biogen 1.75 %
6 Shearman & Sterling 1.58 %
7 Kirkland & Ellis 1.45 %
8 Ropes & Gray 1.39 %
9 Google 1.36 %
10 WeWork 1.27 %
11 Weil Gotshal & Manges 1.24 %
12 O’Melveny & Myers 1.12 %
13 Wellington Management 1.08 %
14 Bank of America 0.96 %
15 Morrison & Foerster 0.90 %
16 Aramis (Estee Lauder) 0.89 %
17 Mass Financial Services 0.88 %
18 Millennium Management 0.87 %
19 Hunton Andrews Kurth 0.77 %
20 Starr Indemnity & Liability Co. 0.75 %
BXP’s Share of Annualized Rental Obligations 28.15 %
BXP’s Share of Square Feet ^1^ 24.08 % NOTABLE SIGNED DEALS ^2^
--- --- ---
Tenant Property Square Feet
Fannie Mae Reston Gateway 850,000
Marriott International 7750 Wisconsin Avenue 734,000
Verizon 100 Causeway Street 440,000
Google 325 Main Street 379,000
Wilmer Cutler Pickering Hale 2100 Pennsylvania Avenue 287,000 TENANT DIVERSIFICATION ^1^
---

chart-7c8d290915fe5f56bfba02.jpg

_____________

^1^ See the Definitions and Reconciliations sections of this Supplemental package starting on page 54.
^2^ Represents leases signed with occupancy commencing in the future. The number of square feet is an estimate.
--- ---

25

Q4 2019
Occupancy by location

as of December 31, 2019

TOTAL IN-SERVICE OFFICE PROPERTIES ^1^- Quarter-over-Quarter
CBD Suburban Total
Location 31-Dec-19 30-Sep-19 31-Dec-19 30-Sep-19 31-Dec-19 30-Sep-19
Boston 98.4 % 99.0 % 90.8 % 88.9 % 95.9 % 95.4 %
Los Angeles 96.7 % 96.8 % — % — % 96.7 % 96.8 %
New York 94.4 % 92.8 % 87.0 % 85.2 % 92.9 % 91.2 %
San Francisco 97.2 % 96.8 % 83.3 % 83.3 % 93.7 % 93.4 %
Washington, DC 85.4 % 88.1 % 89.1 % 88.4 % 87.6 % 88.3 %
Total Portfolio 95.2 % 95.2 % 88.6 % 87.4 % 93.0 % 92.6 %

chart-ca9c65ded50e5e7cad7a02.jpg

SAME PROPERTY OFFICE PROPERTIES ^1, 2^- Year-over-Year
CBD Suburban Total
Location 31-Dec-19 31-Dec-18 31-Dec-19 31-Dec-18 31-Dec-19 31-Dec-18
Boston 98.7 % 98.0 % 91.4 % 93.5 % 96.2 % 96.5 %
Los Angeles 96.7 % 96.7 % — % — % 96.7 % 96.7 %
New York 94.4 % 92.1 % 87.0 % 83.0 % 92.9 % 90.2 %
San Francisco 96.5 % 93.1 % 83.3 % 89.5 % 92.4 % 91.9 %
Washington, DC 85.4 % 93.0 % 89.1 % 90.4 % 87.6 % 91.4 %
Total Portfolio 95.0 % 94.7 % 88.7 % 90.1 % 92.9 % 93.1 %

chart-d5edfbb7889e57f0bc7a02.jpg

_____________

^1^ Represents signed leases for which revenue recognition has commenced in accordance with GAAP. Includes 100% of joint venture properties. Does not include residential units and hotel.
^2^ See the Definitions and Reconciliations sections of this Supplemental package starting on page 54.
--- ---

26

Q4 2019
Capital structure

(in thousands, except percentages)

CONSOLIDATED DEBT
Aggregate Principal
Mortgage Notes Payable $ 2,949,154
Unsecured Line of Credit —
Unsecured Term Loan 500,000
Unsecured Senior Notes, at face value 8,450,000
Outstanding Principal 11,899,154
Discount on Unsecured Senior Notes (17,451 )
Deferred Financing Costs, Net (69,897 )
Consolidated Debt $ 11,811,806 MORTGAGE NOTES PAYABLE
--- --- --- --- --- ---
Interest Rate
Property Maturity Date GAAP Stated Outstanding Principal
University Place August 1, 2021 6.99% 6.94% $ 3,623
601 Lexington Avenue (55% ownership) April 10, 2022 4.79% 4.75% 645,531
767 Fifth Avenue (The GM Building) (60% ownership) June 9, 2027 3.64% 3.43% 2,300,000
Total $ 2,949,154 BOSTON PROPERTIES LIMITED PARTNERSHIP UNSECURED SENIOR NOTES ^1^
--- --- --- --- --- ---
Maturity Date Effective Yield (on issue date) Coupon Outstanding Principal
10 Year Unsecured Senior Notes May 15, 2021 4.29% 4.13% $ 850,000
11 Year Unsecured Senior Notes February 1, 2023 3.95% 3.85% 1,000,000
10.5 Year Unsecured Senior Notes September 1, 2023 3.28% 3.13% 500,000
10.5 Year Unsecured Senior Notes February 1, 2024 3.92% 3.80% 700,000
7 Year Unsecured Senior Notes January 15, 2025 3.35% 3.20% 850,000
10 Year Unsecured Senior Notes February 1, 2026 3.77% 3.65% 1,000,000
10 Year Unsecured Senior Notes October 1, 2026 3.50% 2.75% 1,000,000
10 Year Unsecured Senior Notes (“green bonds”) December 1, 2028 4.63% 4.50% 1,000,000
10 Year Unsecured Senior Notes (“green bonds”) June 21, 2029 3.51% 3.40% 850,000
10.5 Year Unsecured Senior Notes March 15, 2030 2.98% 2.90% 700,000
$ 8,450,000 CAPITALIZATION
--- --- --- --- --- ---
Shares/Units Common Stock Equivalent
Outstanding Equivalents Value ^2^
Common Stock 154,790 154,790 $ 21,339,349
Common Operating Partnership Units 17,908 17,908 2,468,797
5.25% Series B Cumulative Redeemable Preferred Stock (callable on or after March 27, 2018) 80 — 200,000
Total Equity 172,698 $ 24,008,146
Consolidated Debt (A) $ 11,811,806
Add: BXP’s share of unconsolidated joint venture debt ^3^ 980,110
Less: Partners’ share of consolidated debt ^4^ 1,199,854
BXP’s Share of Debt ^5^ (B) $ 11,592,062
Consolidated Market Capitalization (C) $ 35,819,952
BXP’s Share of Market Capitalization ^5^(D) $ 35,600,208
Consolidated Debt/Consolidated Market Capitalization (A÷C) 32.98 %
BXP’s Share of Debt/BXP’s Share of Market Capitalization ^5^(B÷D) 32.56 %

_____________

^1^ All unsecured senior notes are rated A- (negative), and Baa1 (stable) by S&P and Moody’s, respectively.
^2^ Values based on December 31, 2019 closing price of $137.86 per share of common stock, except the Series B Preferred Stock is valued at its fixed liquidation preference.
--- ---
^3^ Amount is calculated based on the Company’s percentage ownership interest in the unconsolidated joint venture entities. For additional detail, see page 34.
--- ---
^4^ Amount is calculated based on the outside partners’ percentage ownership interest in the consolidated joint venture entities. For additional detail, see page 32.
--- ---
^5^ See the Definitions and Reconciliations sections of this Supplemental package starting on page 54.
--- ---

27

Q4 2019
Debt analysis ^1^

as of December 31, 2019

(dollars in thousands)

chart-589c1dea8fee511d9d8a02.jpg

UNSECURED CREDIT FACILITY - MATURES APRIL 24, 2022
Facility Outstanding at December 31, 2019 Letters of Credit Remaining Capacity at December 31, 2019
Unsecured Line of Credit $ 1,500,000 $ — $ 2,457 $ 1,497,543
Unsecured Term Loan $ 500,000 $ 500,000 N/A $ —
UNSECURED AND SECURED DEBT ANALYSIS
--- --- --- --- --- --- --- ---
Weighted Average
% of Total Debt Stated Rates GAAP Rates ^2^ Maturity (years)
Unsecured Debt 75.26 % 3.62 % 3.71 % 5.7
Secured Debt 24.74 % 3.73 % 3.90 % 6.3
Consolidated Debt 100.00 % 3.65 % 3.75 % 5.9
FLOATING AND FIXED RATE DEBT ANALYSIS
--- --- --- --- --- --- --- ---
Weighted Average
% of Total Debt Stated Rates GAAP Rates ^2^ Maturity (years)
Floating Rate Debt 4.22 % 2.66 % 2.75 % 2.3
Fixed Rate Debt 95.78 % 3.69 % 3.80 % 6.0
Consolidated Debt 100.00 % 3.65 % 3.75 % 5.9

_____________

^1^ Excludes unconsolidated joint ventures. For information on BXP’s share of unconsolidated joint venture debt, see page 34.
^2^ The GAAP interest rate differs from the stated interest rate due to the inclusion of the amortization of financing charges and the effects of hedging transactions.
--- ---

28

Q4 2019
Senior unsecured debt covenant compliance ratios

In the fourth quarter of 2002, the Company’s Operating Partnership (Boston Properties Limited Partnership) received investment grade ratings on its senior unsecured debt securities and thereafter issued unsecured notes. The notes were issued under an indenture, dated as of December 13, 2002, by and between Boston Properties Limited Partnership and The Bank of New York Mellon Trust Company, N.A., as trustee, as supplemented from time to time (the “Indenture”), which, among other things, requires us to comply with the following limitations on incurrence of debt: Limitation on Outstanding Debt; Limitation on Secured Debt; Ratio of Annualized Consolidated EBITDA to Annualized Interest Expense; and Maintenance of Unencumbered Assets. Compliance with these restrictive covenants requires us to apply specialized terms the meanings of which are described in detail in our filings with the SEC, and to calculate ratios in the manner prescribed by the Indenture.

This section presents such ratios as of December 31, 2019 to show that the Company’s Operating Partnership was in compliance with the terms of the Indenture, which has been filed with the SEC. Management is not presenting these ratios for any other purpose or for any other period, and is not intending for these measures to otherwise provide information to investors about the Company’s financial condition or results of operations. Investors should not rely on these measures other than for purposes of testing our compliance with the Indenture.

COVENANT RATIOS AND RELATED DATA

Senior Notes Issued Prior to December 4, 2017 Senior Notes issued On or After December 4, 2017
Test Actual
Total Outstanding Debt/Total Assets ^1^ Less than 60% 43.4 % 39.8 %
Secured Debt/Total Assets Less than 50% 14.0 % 12.8 %
Interest Coverage (Annualized Consolidated EBITDA to Annualized Interest Expense) Greater than 1.50x 4.41 4.41
Unencumbered Assets/ Unsecured Debt Greater than 150% 252.8 % 277.0 %

_____________

^1^ Capitalized Property Value for senior notes issued prior to December 4, 2017 is determined for each property and is the greater of (A) annualized EBITDA capitalized at an 8.0% rate for CBD properties and a 9.0% rate for non-CBD properties, and (B) the undepreciated book value as determined under GAAP. Capitalized property value for senior notes issued on or after December 4, 2017 is determined for each property and is the greater of (x) annualized EBITDA capitalized at 7.0% and (y) the undepreciated book value as determined under GAAP.

29

Q4 2019
Net Debt to EBITDAre

(dollars in thousands)

Reconciliation of BXP’s Share of EBITDAre and BXP’s Share of EBITDAre – cash ^1^
Three Months Ended
31-Dec-19 30-Sep-19
Net income attributable to Boston Properties, Inc. common shareholders $ 140,824 $ 107,771
Add:
Preferred dividends 2,625 2,625
Noncontrolling interest - common units of the Operating Partnership 16,222 12,504
Noncontrolling interest in property partnerships 16,338 18,470
Net income 176,009 141,370
Add:
Interest expense 102,880 106,471
Losses from early extinguishments of debt 1,530 28,010
Depreciation and amortization expense 169,897 165,862
Less:
Gains (losses) on sales of real estate (57 ) (15 )
Income (loss) from unconsolidated joint ventures (936 ) (649 )
Add:
BXP’s share of EBITDAre from unconsolidated joint ventures ^2^ 24,328 23,378
EBITDAre ^1^ 475,637 465,755
Less:
Partners’ share of EBITDAre from consolidated joint ventures ^3^ 45,356 46,592
BXP’s Share of EBITDAre ^1^ (A) 430,281 419,163
Add:
Stock-based compensation expense 7,705 7,809
BXP’s Share of straight-line ground rent expense adjustment ^1^ 1,056 1,019
BXP’s Share of lease transaction costs that qualify as rent inducements ^1^ 9,403 2,041
Less:
BXP’s Share of non-cash termination income adjustment (fair value lease amounts) ^1^ — —
BXP’s Share of straight-line rent ^1^ 43,501 (1,904 )
BXP’s Share of straight-line rent from deferred revenue ^1, 4^ — 22,156
BXP’s Share of fair value lease revenue ^1^ 3,298 4,467
BXP’s Share of EBITDAre – cash ^1^ $ 401,646 $ 405,313
BXP’s Share of EBITDAre (Annualized) ^5^ (A x 4) $ 1,721,124 $ 1,676,652
Reconciliation of BXP’s Share of Net Debt^1^
--- --- --- --- ---
31-Dec-19 30-Sep-19
Consolidated debt $ 11,811,806 $ 11,838,738
Add:
Special dividend payable — —
Less:
Cash and cash equivalents 644,950 751,210
Cash held in escrow for 1031 exchange — 3,850
Net debt ^1^ 11,166,856 11,083,678
Add:
BXP’s share of unconsolidated joint venture debt ^2^ 980,110 924,366
Partners’ share of cash and cash equivalents from consolidated joint ventures 120,791 122,317
Less:
BXP’s share of cash and cash equivalents from unconsolidated joint ventures 90,206 84,199
Partners’ share of consolidated joint venture debt ^3^ 1,199,854 1,201,113
BXP’s Share of Net Debt ^1^ (B) $ 10,977,697 $ 10,845,049
BXP’s Share of Net Debt to BXP’s Share of EBITDAre (Annualized) [B ÷ (A x 4)] 6.38 6.47

_____________

^1^ See the Definitions and Reconciliations sections of this Supplemental package starting on page 54.
^2^ For disclosures related to the calculation of BXP’s share from unconsolidated joint ventures for the three months ended December 31, 2019, see pages 34 and 62.
--- ---
^3^ For disclosures related to the calculation of Partners’ share from consolidated joint ventures for the three months ended December 31, 2019, see pages 32 and 60.
--- ---
^4^ Represents the straight-line impact related to deferred revenue from a tenant. For additional information, see page 58.
--- ---
^5^ BXP’s Share of EBITDAre is annualized and calculated as the product of such amount for the quarter multiplied by four (4).
--- ---

30

Q4 2019
Debt ratios

(in thousands, except for ratio amounts)

INTEREST COVERAGE RATIO ^1^

Three Months Ended
31-Dec-19 30-Sep-19
BXP’s Share of interest expense ^1^ $ 102,752 $ 105,546
Less:
BXP’s Share of hedge amortization ^1^ 1,435 1,435
BXP’s Share of amortization of financing costs ^1^ 3,341 3,150
Adjusted interest expense excluding capitalized interest (A) 97,976 100,961
Add:
BXP’s Share of capitalized interest ^1^ 15,014 17,277
Adjusted interest expense including capitalized interest (B) $ 112,990 $ 118,238
BXP’s Share of EBITDAre – cash ^1, 2^(C) $ 401,646 $ 405,313
Interest Coverage Ratio (excluding capitalized interest) (C÷A) 4.10 4.01
Interest Coverage Ratio (including capitalized interest) (C÷B) 3.55 3.43

FIXED CHARGE COVERAGE RATIO ^1^

Three Months Ended
31-Dec-19 30-Sep-19
BXP’s Share of interest expense ^1^ $ 102,752 $ 105,546
Less:
BXP’s Share of hedge amortization ^1^ 1,435 1,435
BXP’s Share of amortization of financing costs ^1^ 3,341 3,150
Add:
BXP’s Share of capitalized interest ^1^ 15,014 17,277
BXP’s Share of maintenance capital expenditures ^1^ 25,457 31,263
Hotel improvements, equipment upgrades and replacements 148 177
Preferred dividends/distributions 2,625 2,625
Total Fixed Charges (A) $ 141,220 $ 152,303
BXP’s Share of EBITDAre – cash ^1, 2^ (B) $ 401,646 $ 405,313
Fixed Charge Coverage Ratio (B÷A) 2.84 2.66

_____________

^1^ See the Definitions and Reconciliations sections of this Supplemental package starting on page 54.
^2^ For a qualitative reconciliation of BXP’s Share of EBITDAre – cash, see page 30.
--- ---

31

Q4 2019
Consolidated joint ventures

as of December 31, 2019

(unaudited and dollars in thousands)

BALANCE SHEET INFORMATION

Norges Joint Ventures ^1^
Times Square Tower
601 Lexington Avenue / <br>One Five Nine East 53rd Street
767 Fifth Avenue 100 Federal Street Total Consolidated
ASSETS (The GM Building) ^1^ Atlantic Wharf Office Joint Ventures
Real estate, net $ 3,227,546 $ 2,252,917 $ 5,480,463
Cash and cash equivalents 104,472 175,561 280,033
Other assets 278,941 362,393 641,334
Total assets $ 3,610,959 $ 2,790,871 $ 6,401,830
LIABILITIES AND EQUITY
Liabilities:
Mortgage notes payable, net $ 2,273,985 $ 644,778 $ 2,918,763
Other liabilities 119,609 96,832 216,441
Total liabilities 2,393,594 741,610 3,135,204
Equity:
Boston Properties, Inc. 731,992 805,835 1,537,827
Noncontrolling interests 485,373 1,243,426 1,728,799 ^2^
Total equity 1,217,365 2,049,261 3,266,626
Total liabilities and equity $ 3,610,959 $ 2,790,871 $ 6,401,830
BXP’s nominal ownership percentage 60% 55%
Partners’ share of cash and cash equivalents ^3^ $ 41,789 $ 79,002 $ 120,791
Partners’ share of consolidated debt ^3, 4^ $ 909,704 $ 290,150 $ 1,199,854

_____________

^1^ Certain balances contain amounts that eliminate in consolidation.
^2^ Amount excludes preferred shareholders’ capital of approximately $0.1 million.
--- ---
^3^ Amounts represent the partners’ share based on their respective ownership percentages.
--- ---
^4^ Amounts adjusted for basis differentials.
--- ---

32

Q4 2019
Consolidated joint ventures (continued)

for the three months ended December 31, 2019

(unaudited and dollars in thousands)

RESULTS OF OPERATIONS

Norges Joint Ventures
Times Square Tower
601 Lexington Avenue / <br>One Five Nine East 53rd Street
767 Fifth Avenue 100 Federal Street Total Consolidated
(The GM Building) Atlantic Wharf Office Joint Ventures
Revenue
Lease ^1^ $ 67,017 $ 96,417 $ 163,434
Straight-line rent 4,070 4,007 8,077
Fair value lease revenue 1,448 119 1,567
Termination income — — —
Total lease revenue 72,535 100,543 173,078
Parking and other 2 1,597 1,599
Total rental revenue ^2^ 72,537 102,140 174,677
Expenses
Operating 30,474 35,960 66,434
Net Operating Income (NOI) 42,063 66,180 108,243
Other income (expense)
Development and management services revenue — 49 49
Interest and other income 433 587 1,020
Interest expense (21,396 ) (5,216 ) (26,612 )
Depreciation and amortization expense (19,878 ) (22,712 ) (42,590 )
General and administrative expense (64 ) (300 ) (364 )
Total other income (expense) (40,905 ) (27,592 ) (68,497 )
Net income $ 1,158 $ 38,588 $ 39,746

FUNDS FROM OPERATIONS (FFO)

BXP’s nominal ownership percentage 60% 55%
Norges Joint Ventures
Times Square Tower
601 Lexington Avenue / <br>One Five Nine East 53rd Street
767 Fifth Avenue 100 Federal Street Total Consolidated
Reconciliation of Partners’ share of FFO (The GM Building) Atlantic Wharf Office Joint Ventures
Net income $ 1,158 $ 38,588 $ 39,746
Add: Depreciation and amortization expense 19,878 22,712 42,590
Entity FFO $ 21,036 $ 61,300 $ 82,336
Partners’ NCI ^3^ $ (173 ) $ 16,511 $ 16,338
Partners’ share of depreciation and amortization expense after BXP’s basis differential ^3^ 7,931 10,185 18,116
Partners’ share FFO ^3^ $ 7,758 $ 26,696 $ 34,454
Reconciliation of BXP’s share of FFO
BXP’s share of net income adjusted for partners’ NCI $ 1,331 $ 22,077 $ 23,408
Depreciation and amortization expense - BXP’s basis difference 51 80 131
BXP’s share of depreciation and amortization expense 11,896 12,447 24,343
BXP’s share of FFO $ 13,278 $ 34,604 $ 47,882

_____________

^1^ Lease revenue includes recoveries from tenants and service income from tenants.^^
^2^ See the Definitions and Reconciliations sections of this Supplemental package starting on page 54.
--- ---
^3^ Amounts represent the partners’ share based on their respective ownership percentage and is adjusted for basis differentials and the allocations of management and other fees and interest to BXP.^^
--- ---

33

Q4 2019
Unconsolidated joint ventures ^1^

as of December 31, 2019

(unaudited and dollars in thousands)

BALANCE SHEET INFORMATION

BXP’s Nominal Ownership Mortgage/Construction Loans Payable, Net Interest Rate
Property Net Equity Maturity Date Stated GAAP ^2^
540 Madison Avenue ^3^ 60.00 % $ 2,953 $ — — — % — %
Santa Monica Business Park 55.00 % 163,937 163,396 July 19, 2025 4.06 % 4.24 %
Platform 16 55.00 % 29,501 — — — % — %
Colorado Center 50.00 % 252,069 274,609 August 9, 2027 3.56 % 3.58 %
Dock 72 50.00 % 94,804 85,206 December 18, 2020 4.02 % 5.16 %
The Hub on Causeway 50.00 % — — — — % — %
Podium 50.00 % 49,466 78,465 September 6, 2021 4.06 % 4.55 %
Hub50House 50.00 % 55,092 69,999 April 19, 2022 3.77 % 4.06 %
100 Causeway Street 50.00 % 56,606 39,000 September 5, 2023 3.31 % 3.52 %
Hotel Air Rights 50.00 % 9,883 — — — % — %
1001 6th Street 50.00 % 42,496 — — — % — %
7750 Wisconsin Avenue (Marriott International Headquarters) 50.00 % 56,247 29,908 April 26, 2023 3.07 % 3.62 %
Annapolis Junction 50.00 % 25,391 — — — % — %
Annapolis Junction Building Six 50.00 % — 6,258 November 17, 2020 3.76 % 3.91 %
Annapolis Junction Building Seven and Eight 50.00 % — 17,393 March 6, 2020 4.19 % 4.30 %
1265 Main Street 50.00 % 3,780 18,913 January 1, 2032 3.77 % 3.84 %
Market Square North 50.00 % (4,872 ) 58,059 October 1, 2020 4.85 % 4.91 %
Wisconsin Place Parking Facility 33.33 % 36,789 — — — % — %
500 North Capitol Street, N.W. 30.00 % (5,439 ) 31,439 June 6, 2023 4.15 % 4.20 %
3 Hudson Boulevard ^4^ 25.00 % 67,499 19,944 July 13, 2023 5.34 % 5.42 %
901 New York Avenue 25.00 % (12,113 ) 56,027 January 5, 2025 3.61 % 3.69 %
Metropolitan Square 20.00 % 9,134 31,494 May 5, 2020 5.75 % 5.81 %
933,223
Investments with deficit balances reflected within Other Liabilities 22,424
Investment in Joint Ventures $ 955,647
Mortgage/Construction Loans Payable, Net $ 980,110

chart-3d40aa6112e15fba8e8a02.jpg

FLOATING AND FIXED RATE DEBT ANALYSIS
Weighted Average
% of Total Debt Stated Rate GAAP Rate ^2^ Maturity (years)
Floating Rate Debt 35.32 % 3.90 % 4.43 % 2.0
Fixed Rate Debt 64.68 % 3.96 % 4.03 % 5.8
Total Debt 100.00 % 3.94 % 4.17 % 4.5

34

Q4 2019
Unconsolidated joint ventures (continued) ^1^

_____________

^1^ Amounts represent BXP’s share based on its ownership percentage.
^2^ The GAAP interest rate differs from the stated interest rate due to the inclusion of the amortization of financing charges, which includes mortgage recording fees.
--- ---
^3^ The property was sold on June 27, 2019. For additional detail see, page 13.
--- ---
^4^ The Company has provided $80.0 million of mortgage financing to the joint venture. The loan has been reflected as Related Party Note Receivable on the Company’s Consolidated Balance Sheets.
--- ---

35

Q4 2019
Unconsolidated joint ventures (continued)

for the three months ended December 31, 2019

(unaudited and dollars in thousands)

RESULTS OF OPERATIONS
Market Square North Metropolitan<br> Square 901 New York Avenue Annapolis Junction ^1^ 500 North Capitol Street, N.W. Colorado Center Santa Monica Business Park The Hub on Causeway Other Joint Ventures ^2^ Total Unconsolidated Joint Ventures
Revenue
Lease ^3^ $ 4,909 $ 3,224 $ 7,897 $ 1,915 $ 4,436 $ 19,086 $ 15,647 $ 1,903 $ 1,690 $ 60,707
Straight-line rent 512 3,221 85 55 21 482 1,091 5,215 3,079 13,761
Fair value lease revenue — — — — — 9 953 — — 962
Termination income — — — — — — — — — —
Total lease revenue 5,421 6,445 7,982 1,970 4,457 19,577 17,691 7,118 4,769 75,430
Parking and other 209 643 348 55 123 2,659 2,159 215 1,115 7,526
Total rental revenue ^4^ 5,630 7,088 8,330 2,025 4,580 22,236 19,850 7,333 5,884 82,956
Expenses
Operating 2,589 3,487 3,676 753 1,861 6,397 7,828 3,872 2,917 33,380
Net operating income 3,041 3,601 4,654 1,272 2,719 15,839 12,022 3,461 2,967 49,576
Other income/(expense)
Development and management services revenue 2 — — 4 — — — — — 6
Interest and other income 75 — 141 70 21 223 1 43 183 757
Interest expense (1,432 ) (1,789 ) (2,075 ) (521 ) (1,128 ) (5,033 ) (7,031 ) (2,105 ) (1,250 ) (22,364 )
Transaction costs — — — — — — — — (1,000 ) (1,000 )
Depreciation and amortization expense (1,113 ) (1,658 ) (1,534 ) (666 ) (881 ) (5,273 ) (9,329 ) (2,224 ) (2,676 ) (25,354 )
General and administrative expense (1 ) (42 ) (24 ) (1 ) — — (26 ) (18 ) (30 ) (142 )
Gain on sale of real estate — — — — — — — — (53 ) (53 )
Total other income/(expense) (2,469 ) (3,489 ) (3,492 ) (1,114 ) (1,988 ) (10,083 ) (16,385 ) (4,304 ) (4,826 ) (48,150 )
Net income/(loss) $ 572 $ 112 $ 1,162 $ 158 $ 731 $ 5,756 $ (4,363 ) $ (843 ) $ (1,859 ) $ 1,426
BXP’s nominal ownership percentage 50 % 20 % 25 % 50 % 30 % 50 % 55 % 50 %
Reconciliation of BXP’s share of Funds from Operations (FFO)
BXP’s share of net income/(loss) $ 286 $ 20 $ 288 ^5^ $ 79 $ 219 $ 2,878 $ (2,409 ) $ (422 ) $ (865 ) $ 74
Basis differential
Straight-line rent $ — $ — $ — $ — $ — $ 506 ^6^ $ — $ — $ — $ 506
Fair value lease revenue — — — — — 437 ^6^ — — — 437
Depreciation and amortization expense (47 ) 3 (24 ) (2 ) 2 (1,899 ) 5 21 (12 ) (1,953 )
Total basis differential ^7^ (47 ) 3 (24 ) (2 ) 2 (956 ) ^6^ 5 21 (12 ) (1,010 )
Income/(loss) from unconsolidated joint ventures 239 23 264 ^5^ 77 221 1,922 (2,404 ) (401 ) (877 ) (936 )
Add:
BXP’s share of depreciation and amortization expense 604 328 1,055 ^5^ 335 263 4,535 5,125 1,096 1,117 14,458
Less:
BXP’s share of gain on sale of real estate — — — — — — — — (32 ) (32 )
BXP’s share of FFO $ 843 $ 351 $ 1,319 $ 412 $ 484 $ 6,457 $ 2,721 $ 695 $ 272 $ 13,554

36

Q4 2019
Unconsolidated joint ventures (continued)

_____________

^1^ Annapolis Junction includes three in-service properties and two undeveloped land parcels.^^
^2^ Includes 1001 6th Street, Dock 72, 7750 Wisconsin Avenue, 1265 Main Street, Wisconsin Place Parking Facility, 3 Hudson Boulevard, 540 Madison Avenue and Platform 16.
--- ---
^3^ Lease revenue includes recoveries from tenants and service income from tenants.^^
--- ---
^4^ See the Definitions and Reconciliations sections of this Supplemental package starting on page 54.
--- ---
^5^ Reflects the allocation percentages pursuant to the achievement of specified investment return thresholds as provided for in the joint venture agreement.^^
--- ---
^6^ The Company’s purchase price allocation under ASC 805 for Colorado Center differs from the historical basis of the venture resulting in the majority of the basis differential for this venture.^^
--- ---
^7^ Represents adjustments related to the carrying values and depreciation of certain of the Company’s investment in unconsolidated joint ventures.
--- ---

37

Q4 2019
Lease expirations^^- All in-service properties^1, 2, 3^

as of December 31, 2019

OFFICE
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease Percentage of
Expiration /PSF /PSF Total Square Feet
2019 65,428 51,478 0.14 % ^4^
2020 2,836,829 2,523,999 6.85 %
2021 3,128,343 2,853,903 7.74 %
2022 2,783,791 2,519,024 6.83 %
2023 1,965,371 1,778,470 4.83 %
2024 3,511,698 3,215,671 8.72 %
2025 2,448,541 2,193,072 5.95 %
2026 3,168,132 2,479,329 6.73 %
2027 2,009,179 1,770,749 4.80 %
2028 2,416,351 2,246,381 6.09 %
Thereafter 15,241,778 13,060,172 35.43 %

All values are in US Dollars.

RETAIL
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease Percentage of
Expiration /PSF /PSF Total Square Feet
2019 3,112 1,349 0.06 % ^4^
2020 158,572 149,172 7.05 %
2021 122,114 113,571 5.37 %
2022 216,241 189,764 8.97 %
2023 220,280 215,718 10.19 %
2024 126,315 117,189 5.54 %
2025 162,924 162,082 7.66 %
2026 128,299 107,114 5.06 %
2027 109,049 103,782 4.90 %
2028 262,728 244,863 11.57 %
Thereafter 882,904 692,912 32.74 %

All values are in US Dollars.

IN-SERVICE PROPERTIES
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease Percentage of
Expiration /PSF /PSF Total Square Feet
2019 68,540 52,827 0.14 % ^4^
2020 2,995,401 2,673,171 6.86 %
2021 3,250,457 2,967,474 7.61 %
2022 3,000,032 2,708,788 6.95 %
2023 2,185,651 1,994,188 5.12 %
2024 3,638,013 3,332,860 8.55 %
2025 2,611,465 2,355,154 6.04 %
2026 3,296,431 2,586,443 6.64 %
2027 2,118,228 1,874,531 4.81 %
2028 2,679,079 2,491,244 6.39 %
Thereafter 16,124,682 13,753,084 35.29 %

All values are in US Dollars.

_____________

^1^ For the Company’s definitions and related disclosures, see the Definitions section of this Supplemental package starting on page 54.
^2^ Includes partially placed in-service leased space. Does not include residential units and hotel.
--- ---
^3^ Does not include data for leases expiring in a particular year when leases for the same space have already been signed with replacement tenants with future commencement dates. In those cases, the data is included in the year in which the future lease expires.
--- ---
^4^ Includes square feet expiring on the last day of the current quarter. ^^
--- ---

38

Q4 2019
Lease expirations - Boston region in-service properties ^1, 2, 3^

as of December 31, 2019

OFFICE
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease
Expiration /PSF /PSF
2019 — —
2020 320,061 320,061
2021 840,891 788,274
2022 993,311 934,224
2023 684,180 628,233
2024 915,904 886,701
2025 1,043,714 1,027,199
2026 1,256,347 1,017,288
2027 645,041 645,041
2028 1,079,209 1,079,209
Thereafter 5,215,679 4,653,431

All values are in US Dollars.

RETAIL
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease
Expiration /PSF /PSF
2019 — —
2020 65,928 65,928
2021 28,293 21,977
2022 58,415 58,100
2023 76,155 76,155
2024 70,982 70,982
2025 51,847 51,847
2026 20,123 19,258
2027 64,450 64,450
2028 168,757 167,407
Thereafter 445,359 339,507

All values are in US Dollars.

TOTAL PROPERTY TYPES
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease
Expiration /PSF /PSF
2019 — —
2020 385,989 385,989
2021 869,184 810,251
2022 1,051,726 992,324
2023 760,335 704,388
2024 986,886 957,683
2025 1,095,561 1,079,046
2026 1,276,470 1,036,546
2027 709,491 709,491
2028 1,247,966 1,246,616
Thereafter 5,661,038 4,992,938

All values are in US Dollars.

_____________

^1^ For the Company’s definitions and related disclosures, see the Definitions section of this Supplemental package starting on page 54.
^2^ Includes partially placed in-service leased space. Does not include residential units and hotel.
--- ---
^3^ Does not include data for leases expiring in a particular year when leases for the same space have already been signed with replacement tenants with future commencement dates. In those cases, the data is included in the year in which the future lease expires.
--- ---

39

Q4 2019
Quarterly lease expirations - Boston region in-service properties ^1, 2, 3^

as of December 31, 2019

OFFICE
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Lease Expiration
by Quarter /PSF /PSF
Q1 2019 — —
Q2 2019 — —
Q3 2019 — —
Q4 2019 — —
Total 2019 — —
Q1 2020 17,814 17,814
Q2 2020 45,367 45,367
Q3 2020 37,886 37,886
Q4 2020 218,994 218,994
Total 2020 320,061 320,061

All values are in US Dollars.

RETAIL
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Lease Expiration
by Quarter /PSF /PSF
Q1 2019 — —
Q2 2019 — —
Q3 2019 — —
Q4 2019 — —
Total 2019 — —
Q1 2020 7,597 7,597
Q2 2020 41,296 41,296
Q3 2020 15,852 15,852
Q4 2020 1,183 1,183
Total 2020 65,928 65,928

All values are in US Dollars.

TOTAL PROPERTY TYPES
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Lease Expiration
by Quarter /PSF /PSF
Q1 2019 — —
Q2 2019 — —
Q3 2019 — —
Q4 2019 — —
Total 2019 — —
Q1 2020 25,411 25,411
Q2 2020 86,663 86,663
Q3 2020 53,738 53,738
Q4 2020 220,177 220,177
Total 2020 385,989 385,989

All values are in US Dollars.

_____________

^1^ For the Company’s definitions and related disclosures, see the Definitions section of this Supplemental package starting on page 54.
^2^ Includes partially placed in-service leased space. Does not include residential units and hotel.
--- ---
^3^ Does not include data for leases expiring in a particular year when leases for the same space have already been signed with replacement tenants with future commencement dates. In those cases, the data is included in the year in which the future lease expires.
--- ---

40

Q4 2019
Lease expirations - Los Angeles region in-service properties ^1, 2, 3^

as of December 31, 2019

OFFICE
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease
Expiration /PSF /PSF
2019 17,471 9,609 ^4^
2020 393,394 209,742
2021 313,200 157,524
2022 43,921 22,274
2023 156,821 82,651
2024 111,182 61,150
2025 6,450 3,548
2026 431,010 237,056
2027 13,937 7,665
2028 263,043 134,894
Thereafter 346,204 173,102

All values are in US Dollars.

RETAIL
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease
Expiration /PSF /PSF
2019 — —
2020 17,744 9,759
2021 — —
2022 39,888 21,850
2023 1,405 703
2024 4,333 2,283
2025 — —
2026 5,827 3,205
2027 — —
2028 — —
Thereafter 23,114 11,813

All values are in US Dollars.

TOTAL PROPERTY TYPES
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease
Expiration /PSF /PSF
2019 17,471 9,609 ^4^
2020 411,138 219,501
2021 313,200 157,524
2022 83,809 44,124
2023 158,226 83,354
2024 115,515 63,433
2025 6,450 3,548
2026 436,837 240,261
2027 13,937 7,665
2028 263,043 134,894
Thereafter 369,318 184,915

All values are in US Dollars.

_____________

^1^ For the Company’s definitions and related disclosures, see the Definitions section of this Supplemental package starting on page 54.
^2^ Includes partially placed in-service leased space. The Company owns 50% of Colorado Center and 55% of Santa Monica Business Park.
--- ---
^3^ Does not include data for leases expiring in a particular year when leases for the same space have already been signed with replacement tenants with future commencement dates. In those cases, the data is included in the year in which the future lease expires.
--- ---
^4^ Includes square feet expiring on the last day of the current quarter.
--- ---

41

Q4 2019
Quarterly lease expirations - Los Angeles region in-service properties ^1, 2, 3^

as of December 31, 2019

OFFICE
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Lease Expiration
by Quarter /PSF /PSF
Q1 2019 — —
Q2 2019 — —
Q3 2019 — —
Q4 2019 17,471 9,609 ^4^
Total 2019 17,471 9,609
Q1 2020 9,126 5,019
Q2 2020 2,608 1,434
Q3 2020 16,483 9,066
Q4 2020 365,177 194,223
Total 2020 393,394 209,742

All values are in US Dollars.

RETAIL
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Lease Expiration
by Quarter /PSF /PSF
Q1 2019 — —
Q2 2019 — —
Q3 2019 — —
Q4 2019 — —
Total 2019 — —
Q1 2020 9,367 5,152
Q2 2020 — —
Q3 2020 8,377 4,607
Q4 2020 — —
Total 2020 17,744 9,759

All values are in US Dollars.

TOTAL PROPERTY TYPES
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Lease Expiration
by Quarter /PSF /PSF
Q1 2019 — —
Q2 2019 — —
Q3 2019 — —
Q4 2019 17,471 9,609 ^4^
Total 2019 17,471 9,609
Q1 2020 18,493 10,171
Q2 2020 2,608 1,434
Q3 2020 24,860 13,673
Q4 2020 365,177 194,223
Total 2020 411,138 219,501

All values are in US Dollars.

_____________

^1^ For the Company’s definitions and related disclosures, see the Definitions section of this Supplemental package starting on page 54.
^2^ Includes partially placed in-service leased space. The Company owns 50% of Colorado Center and 55% of Santa Monica Business Park.
--- ---
^3^ Does not include data for leases expiring in a particular year when leases for the same space have already been signed with replacement tenants with future commencement dates. In those cases, the data is included in the year in which the future lease expires.
--- ---
^4^ Includes square feet expiring on the last day of the current quarter.
--- ---

42

Q4 2019
Lease expirations - New York region in-service properties ^1, 2, 3^

as of December 31, 2019

OFFICE
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease
Expiration /PSF /PSF
2019 47,957 41,869 ^4^
2020 523,616 430,891
2021 351,836 293,827
2022 787,010 627,160
2023 259,250 212,771
2024 1,149,064 972,435
2025 599,727 525,317
2026 711,128 514,198
2027 458,337 378,196
2028 260,250 238,204
Thereafter 4,776,192 3,788,901

All values are in US Dollars.

RETAIL
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease
Expiration /PSF /PSF
2019 761 761 ^4^
2020 1,600 1,600
2021 10,925 10,925
2022 39,689 34,884
2023 1,847 1,108
2024 3,075 3,075
2025 1,872 1,030
2026 40,723 24,232
2027 243 146
2028 — —
Thereafter 248,286 186,252

All values are in US Dollars.

TOTAL PROPERTY TYPES
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease
Expiration /PSF /PSF
2019 48,718 42,630 ^4^
2020 525,216 432,491
2021 362,761 304,752
2022 826,699 662,044
2023 261,097 213,879
2024 1,152,139 975,510
2025 601,599 526,347
2026 751,851 538,430
2027 458,580 378,342
2028 260,250 238,204
Thereafter 5,024,478 3,975,153

All values are in US Dollars.

_____________

^1^ For the Company’s definitions and related disclosures, see the Definitions section of this Supplemental package starting on page 54.
^2^ Includes partially placed in-service leased space.
--- ---
^3^ Does not include data for leases expiring in a particular year when leases for the same space have already been signed with replacement tenants with future commencement dates. In those cases, the data is included in the year in which the future lease expires.
--- ---
^4^ Includes square feet expiring on the last day of the current quarter.
--- ---

43

Q4 2019
Quarterly lease expirations - New York region in-service properties ^1, 2, 3^

as of December 31, 2019

OFFICE
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Lease Expiration
by Quarter /PSF /PSF
Q1 2019 — —
Q2 2019 — —
Q3 2019 — —
Q4 2019 47,957 41,869 ^4^
Total 2019 47,957 41,869
Q1 2020 170,631 101,645
Q2 2020 17,389 17,389
Q3 2020 262,439 262,439
Q4 2020 73,157 49,418
Total 2020 523,616 430,891

All values are in US Dollars.

RETAIL
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Lease Expiration
by Quarter /PSF /PSF
Q1 2019 — —
Q2 2019 — —
Q3 2019 — —
Q4 2019 761 761 ^4^
Total 2019 761 761
Q1 2020 1,600 1,600
Q2 2020 — —
Q3 2020 — —
Q4 2020 — —
Total 2020 1,600 1,600

All values are in US Dollars.

TOTAL PROPERTY TYPES
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Lease Expiration
by Quarter /PSF /PSF
Q1 2019 — —
Q2 2019 — —
Q3 2019 — —
Q4 2019 48,718 42,630 ^4^
Total 2019 48,718 42,630
Q1 2020 172,231 103,245
Q2 2020 17,389 17,389
Q3 2020 262,439 262,439
Q4 2020 73,157 49,418
Total 2020 525,216 432,491

All values are in US Dollars.

_____________

^1^ For the Company’s definitions and related disclosures, see the Definitions section of this Supplemental package starting on page 54.
^2^ Includes partially placed in-service leased space.
--- ---
^3^ Does not include data for leases expiring in a particular year when leases for the same space have already been signed with replacement tenants with future commencement dates. In those cases, the data is included in the year in which the future lease expires.
--- ---
^4^ Includes square feet expiring on the last day of the current quarter.
--- ---

44

Q4 2019
Lease expirations - San Francisco region in-service properties ^1, 2, 3^

as of December 31, 2019

OFFICE
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease
Expiration /PSF /PSF
2019 — —
2020 373,340 373,340
2021 868,997 868,997
2022 691,419 691,419
2023 525,676 525,676
2024 609,391 609,391
2025 444,132 444,132
2026 337,183 337,183
2027 352,459 352,459
2028 480,059 480,059
Thereafter 1,996,855 1,996,855

All values are in US Dollars.

RETAIL
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease
Expiration /PSF /PSF
2019 — —
2020 18,398 18,398
2021 22,532 22,532
2022 38,819 38,819
2023 51,072 51,072
2024 10,225 10,225
2025 31,562 31,562
2026 25,598 25,598
2027 5,056 5,056
2028 15,811 15,811
Thereafter 67,744 67,744

All values are in US Dollars.

TOTAL PROPERTY TYPES
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease
Expiration /PSF /PSF
2019 — — —
2020 391,738 391,738
2021 891,529 891,529
2022 730,238 730,238
2023 576,748 576,748
2024 619,616 619,616
2025 475,694 475,694
2026 362,781 362,781
2027 357,515 357,515
2028 495,870 495,870
Thereafter 2,064,599 2,064,599

All values are in US Dollars.

_____________

^1^ For the Company’s definitions and related disclosures, see the Definitions section of this Supplemental package starting on page 54.
^2^ Includes partially placed in-service leased space.
--- ---
^3^ Does not include data for leases expiring in a particular year when leases for the same space have already been signed with replacement tenants with future commencement dates. In those cases, the data is included in the year in which the future lease expires.
--- ---

45

Q4 2019
Lease expirations - San Francisco region in-service properties ^1, 2, 3^

as of December 31, 2019

OFFICE
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Lease Expiration
by Quarter /PSF /PSF
Q1 2019 — —
Q2 2019 — —
Q3 2019 — —
Q4 2019 — —
Total 2019 — —
Q1 2020 61,284 61,284
Q2 2020 163,355 163,355
Q3 2020 78,047 78,047
Q4 2020 70,654 70,654
Total 2020 373,340 373,340

All values are in US Dollars.

RETAIL
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Lease Expiration
by Quarter /PSF /PSF
Q1 2019 — —
Q2 2019 — —
Q3 2019 — —
Q4 2019 — —
Total 2019 — —
Q1 2020 3,945 3,945
Q2 2020 3,944 3,944
Q3 2020 8,137 8,137
Q4 2020 2,372 2,372
Total 2020 18,398 18,398

All values are in US Dollars.

TOTAL PROPERTY TYPES
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Lease Expiration
by Quarter /PSF /PSF
Q1 2019 — —
Q2 2019 — —
Q3 2019 — —
Q4 2019 — —
Total 2019 — —
Q1 2020 65,229 65,229
Q2 2020 167,299 167,299
Q3 2020 86,184 86,184
Q4 2020 73,026 73,026
Total 2020 391,738 391,738

All values are in US Dollars.

_____________

^1^ For the Company’s definitions and related disclosures, see the Definitions section of this Supplemental package starting on page 54.
^2^ Includes partially placed in-service leased space.
--- ---
^3^ Does not include data for leases expiring in a particular year when leases for the same space have already been signed with replacement tenants with future commencement dates. In those cases, the data is included in the year in which the future lease expires.
--- ---

46

Q4 2019
Lease expirations - Washington, DC region in-service properties ^1, 2, 3^

as of December 31, 2019

OFFICE
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease
Expiration /PSF /PSF
2019 — —
2020 1,226,418 1,189,965
2021 753,419 745,281
2022 268,130 243,947
2023 339,444 329,139
2024 726,157 685,994
2025 354,518 192,876
2026 432,464 373,604
2027 539,405 387,388
2028 333,790 314,015
Thereafter 2,906,848 2,447,883

All values are in US Dollars.

RETAIL
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease
Expiration /PSF /PSF
2019 2,351 588 ^4^
2020 54,902 53,487
2021 60,364 58,137
2022 39,430 36,111
2023 89,801 86,680
2024 37,700 30,624
2025 77,643 77,643
2026 36,028 34,821
2027 39,300 34,130
2028 78,160 61,645
Thereafter 98,401 87,596

All values are in US Dollars.

TOTAL PROPERTY TYPES
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease
Expiration /PSF /PSF
2019 2,351 588 ^4^
2020 1,281,320 1,243,452
2021 813,783 803,418
2022 307,560 280,058
2023 429,245 415,819
2024 763,857 716,618
2025 432,161 270,519
2026 468,492 408,425
2027 578,705 421,518
2028 411,950 375,660
Thereafter 3,005,249 2,535,479

All values are in US Dollars.

_____________

^1^ For the Company’s definitions and related disclosures, see the Definitions section of this Supplemental package starting on page 54.
^2^ Includes partially placed in-service leased space. Does not include residential units.
--- ---
^3^ Does not include data for leases expiring in a particular year when leases for the same space have already been signed with replacement tenants with future commencement dates. In those cases, the data is included in the year in which the future lease expires.
--- ---
^4^ Includes square feet expiring on the last day of the current quarter.
--- ---

47

` Q4 2019
Quarterly lease expirations - Washington, DC region in-service properties ^1, 2, 3^

^^

as of December 31, 2019

OFFICE
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Lease Expiration
by Quarter /PSF /PSF
Q1 2019 — —
Q2 2019 — —
Q3 2019 — —
Q4 2019 — —
Total 2019 — —
Q1 2020 331,684 331,684
Q2 2020 435,290 433,503
Q3 2020 105,214 102,446
Q4 2020 354,230 322,333
Total 2020 1,226,418 1,189,965

All values are in US Dollars.

RETAIL
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Lease Expiration
by Quarter /PSF /PSF
Q1 2019 — —
Q2 2019 — —
Q3 2019 — —
Q4 2019 2,351 588 ^4^
Total 2019 2,351 588
Q1 2020 7,487 7,487
Q2 2020 8,948 8,948
Q3 2020 9,152 7,737
Q4 2020 29,315 29,315
Total 2020 54,902 53,487

All values are in US Dollars.

TOTAL PROPERTY TYPES
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Lease Expiration
by Quarter /PSF /PSF
Q1 2019 — —
Q2 2019 — —
Q3 2019 — —
Q4 2019 2,351 588 ^4^
Total 2019 2,351 588
Q1 2020 339,171 339,171
Q2 2020 444,238 442,451
Q3 2020 114,366 110,183
Q4 2020 383,545 351,648
Total 2020 1,281,320 1,243,452

All values are in US Dollars. _____________

^1^ For the Company’s definitions and related disclosures, see the Definitions section of this Supplemental package starting on page 54.
^2^ Includes partially placed in-service leased space. Does not include residential units.
--- ---
^3^ Does not include data for leases expiring in a particular year when leases for the same space have already been signed with replacement tenants with future commencement dates. In those cases, the data is included in the year in which the future lease expires.
--- ---
^4^ Includes square feet expiring on the last day of the current quarter.
--- ---

48

Q4 2019
Lease expirations - CBD properties ^1, 2, 3^

^^

as of December 31, 2019

Boston
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease
Expiration /PSF /PSF
2019 — —
2020 224,382 224,382
2021 322,457 263,524
2022 319,548 260,146
2023 487,161 431,214
2024 454,266 425,063
2025 339,481 322,966
2026 1,059,823 819,899
2027 379,000 379,000
2028 1,044,148 1,042,798
Thereafter 4,868,528 4,257,912

All values are in US Dollars.

Los Angeles
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease
Expiration /PSF /PSF
2019 17,471 9,609 ^4^
2020 411,138 219,501
2021 313,200 157,524
2022 83,809 44,124
2023 158,226 83,353
2024 115,515 63,433
2025 6,450 3,548
2026 436,837 240,260
2027 13,937 7,665
2028 263,043 134,894
Thereafter 369,318 184,915

All values are in US Dollars.

New York
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease
Expiration /PSF /PSF
2019 14,290 8,202 ^4^
2020 254,876 162,151
2021 281,042 223,033
2022 737,637 572,982
2023 214,779 167,561
2024 666,351 489,722
2025 396,830 321,578
2026 536,927 323,506
2027 240,939 160,701
2028 216,656 194,610
Thereafter 4,757,105 3,707,780

All values are in US Dollars.

49

Q4 2019
Lease expirations - CBD properties (continued) ^1, 2, 3^

^^

as of December 31, 2019

San Francisco
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease
Expiration /PSF /PSF
2019 — —
2020 207,252 207,252
2021 378,459 378,459
2022 444,256 444,256
2023 392,225 392,225
2024 552,008 552,008
2025 293,056 293,056
2026 362,781 362,781
2027 325,255 325,255
2028 471,358 471,358
Thereafter 1,999,386 1,999,386

All values are in US Dollars.

Washington, DC
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease
Expiration /PSF /PSF
2019 2,351 588 ^4^
2020 166,926 129,057
2021 421,826 411,461
2022 138,539 111,037
2023 51,216 37,790
2024 205,948 187,879
2025 148,425 50,398
2026 337,051 276,984
2027 219,914 78,430
2028 161,756 125,466
Thereafter 1,393,614 923,844

All values are in US Dollars.

_____________

^1^ For the Company’s definitions and related disclosures, see the Definitions section of this Supplemental package starting on page 54.
^2^ Includes partially placed in-service leased space. Does not include residential units and hotel.
--- ---
^3^ Does not include data for leases expiring in a particular year when leases for the same space have already been signed with replacement tenants with future commencement dates. In those cases, the data is included in the year in which the future lease expires.
--- ---
^4^ Includes square feet expiring on the last day of the current quarter.
--- ---

50

Q4 2019
Lease expirations - Suburban properties ^1, 2, 3^

^^

as of December 31, 2019

Boston
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease
Expiration /PSF /PSF
2019 — —
2020 161,607 161,607
2021 546,727 546,727
2022 732,178 732,178
2023 273,174 273,174
2024 532,620 532,620
2025 756,080 756,080
2026 216,647 216,647
2027 330,491 330,491
2028 203,818 203,818
Thereafter 792,510 735,026

All values are in US Dollars.

New York
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease
Expiration /PSF /PSF
2019 34,428 34,428 ^4^
2020 270,340 270,340
2021 81,719 81,719
2022 89,062 89,062
2023 46,318 46,318
2024 485,788 485,788
2025 204,769 204,769
2026 214,924 214,924
2027 217,641 217,641
2028 43,594 43,594
Thereafter 267,373 267,373

All values are in US Dollars.

San Francisco
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease
Expiration /PSF /PSF
2019 — —
2020 184,486 184,486
2021 513,070 513,070
2022 285,982 285,982
2023 184,523 184,523
2024 67,608 67,608
2025 182,638 182,638
2026 — —
2027 32,260 32,260
2028 24,512 24,512
Thereafter 65,213 65,213

All values are in US Dollars.

51

Q4 2019
Lease expirations - Suburban properties (continued) ^1, 2, 3^

^^

as of December 31, 2019

Washington, DC
BXP’s Share
Rentable Square Footage Subject to Expiring Leases Rentable Square Footage Subject to Expiring Leases
Year of Lease
Expiration /PSF /PSF
2019 — —
2020 1,114,394 1,114,394
2021 391,957 391,957
2022 169,021 169,021
2023 378,029 378,029
2024 557,909 528,739
2025 283,736 220,122
2026 131,441 131,441
2027 358,791 343,089
2028 250,194 250,194
Thereafter 1,611,635 1,611,635

All values are in US Dollars.

_____________

^1^ For the Company’s definitions and related disclosures, see the Definitions section of this Supplemental package starting on page 54.
^2^ Includes partially placed in-service leased space. Does not include residential units and hotel.
--- ---
^3^ Does not include data for leases expiring in a particular year when leases for the same space have already been signed with replacement tenants with future commencement dates. In those cases, the data is included in the year in which the future lease expires.
--- ---
^4^ Includes square feet expiring on the last day of the current quarter.
--- ---

52

Q4 2019
Research coverage

With the exception of Green Street Advisors, an independent research firm, the equity analysts listed above are those analysts that, according to First Call Corporation, have published research material on the Company and are listed as covering the Company. Please note that any opinions, estimates or forecasts regarding the Company’s performance made by the analysts listed above do not represent the opinions, estimates or forecasts of the Company or its management. The Company does not by its reference above imply its endorsement of or concurrence with any information, conclusions or recommendations made by any of such analysts.

Equity Research Coverage
Argus Research Company Jacob Kilstein 646.747.5447
Bank of America Merrill Lynch Jeffrey Spector / Jamie Feldman 646.855.1363 / 646.855.5808
Barclays Capital Ross Smotrich 212.526.2306
BMO Capital John Kim 212.885.4115
BTIG Tom Catherwood 212.738.6140
Citigroup Global Markets Michael Bilerman / Emmanuel Korchman 212.816.1383 / 212.816.1382
Deutsche Bank Securities Derek Johnston 212.250.5683
Evercore ISI Steve Sakwa / Jason Green 212.446.9462
Goldman Sachs & Company, Inc. Richard Skidmore 801.741.5459
Green Street Advisors Daniel Ismail 949.640.8780
Jefferies & Co. Jonathan Petersen 212.284.1705 / 212.336.7076
J.P. Morgan Securities Anthony Paolone 212.622.6682
KeyBanc Capital Markets Craig Mailman / Jordan Sadler 917.368.2316 / 917.368.2280
Mizuho Securities Zachary Silverberg/Omotayo Okusanya 212.205.7855
Morgan Stanley Vikram Malhotra 212.761.7064
Morningstar Michael Wong 312.384.5404
Piper Sandler Companies Alexander Goldfarb / Daniel Santos 212.466.7937 / 212.466.7927
RBC Capital Markets Mike Carroll 440.715.2649
RW Baird David Rodgers 216.737.7341
Scotia Capital Inc. Nicholas Yulico 212.225.6904
SMBC Nikko Securities Inc. Richard Anderson 646.521.2351
Stifel, Nicolaus & Company John Guinee / Aaron Wolf 443.224.1307 / 443.224.1206
SunTrust Robinson Humphrey Michael Lewis 212.319.5659
Wells Fargo Securities Blaine Heck 443.263.6529
Debt Research Coverage
--- --- ---
Bank of America Merrill Lynch Andrew Molloy 646.855.6435
Barclays Peter Troisi 212.412.3695
J.P. Morgan Securities Mark Streeter 212.834.5086
US Bank Bill Stafford 877.558.2605
Wells Fargo Thierry Perrein / Kevin McClure 704.715.8455 / 704.410.3252
Rating Agencies
--- --- ---
Moody’s Investors Service Ranjini Venkatesan 212.553.3828
Standard & Poor’s Michael Souers 212.438.2508

53

Q4 2019
Definitions

This section contains definitions of certain non-GAAP financial measures and other terms that the Company uses in this supplemental report and, if applicable, the reasons why management believes these non-GAAP financial measures provide useful information to investors about the Company’s financial condition and results of operations and the other purposes for which management uses the measures. Additional detail can be found in the Company’s most recent annual report on Form 10-K and quarterly report on Form 10-Q, as well as other documents the Company files or furnishes to the SEC from time to time.

The Company also presents “BXP’s Share” of certain of these measures, which are non-GAAP financial measures that are calculated as the consolidated amount calculated in accordance with GAAP, plus the Company’s share of the amount from the Company’s unconsolidated joint ventures (calculated based upon the Company’s percentage ownership interest and, in some cases, after priority allocations), minus the Company’s partners’ share of the amount from the Company’s consolidated joint ventures (calculated based upon the partners’ percentage ownership interests and, in some cases, after priority allocations, income allocation to private REIT shareholders and their share of fees due to the Company).  Management believes that presenting “BXP’s Share” of these measures provides useful information to investors regarding the Company’s financial condition and/or results of operations because the Company has several significant joint ventures and in some cases, the Company exercises significant influence over, but does not control, the joint venture, in which case GAAP requires that the Company account for the joint venture entity using the equity method of accounting and the Company does not consolidate it for financial reporting purposes. In other cases, GAAP requires that the Company consolidate the venture even though the Company’s partner(s) owns a significant percentage interest. As a result, management believes that presenting BXP Share of various financial measures in this manner can help investors better understand the Company’s financial condition and/or results of operations after taking into account its true economic interest in these joint ventures.  The Company cautions investors that the ownership percentages used in calculating “BXP’s Share” of these measures may not completely and accurately depict all of the legal and economic implications of holding an interest in a consolidated or unconsolidated joint venture. For example, in addition to partners’ interests in profits and capital, venture agreements vary in the allocation of rights regarding decision making (both routine and major decisions), distributions, transferability of interests, financings and guarantees, liquidations and other matters. As a result, presentations of “BXP’s Share” of a financial measure should not be considered a substitute for, and should only be considered together with and as a supplement to, the Company’s financial information presented in accordance with GAAP. Unless noted otherwise, reconciliations of “BXP’s Share” of these financial measures can be found in the Reconciliations section of this Supplemental package starting on page 58.

Annualized Rental Obligations

Annualized Rental Obligations is defined as monthly Rental Obligations, as of the last day of the reporting period, multiplied by twelve (12).

Average Economic Occupancy

Average Economic Occupancy is defined as (1) total possible revenue less vacancy loss divided by (2) total possible revenue, expressed as a percentage. Total possible revenue is determined by valuing average occupied units at contract rates and average vacant units at Market Rents. Vacancy loss is determined by valuing vacant units at current Market Rents. By measuring vacant units at their Market Rents, Average Economic Occupancy takes into account the fact that units of different sizes and locations within a residential property have different economic impacts on a residential property’s total possible gross revenue.

Average Monthly Rental Rates

Average Monthly Rental Rates are calculated by the Company as the average of the quotients obtained by dividing (A) rental revenue as determined in accordance with GAAP by (B) the number of occupied units for each month within the applicable fiscal period.

Average Physical Occupancy

Average Physical Occupancy is defined as (1) the average number of occupied units divided by (2) the total number of units, expressed as a percentage.

Debt to Market Capitalization Ratio

Consolidated Debt to Consolidated Market Capitalization Ratio is a measure of leverage commonly used by analysts in the REIT sector that equals the quotient of (A) the Company’s Consolidated Debt divided by (B) the Company’s Consolidated Market Capitalization, presented as a percentage. Consolidated Market Capitalization is the sum of (x) the Company’s Consolidated Debt plus (y) the market value of the Company’s outstanding equity securities calculated using the closing price per share of common stock of the Company, as reported by the New York Stock Exchange, multiplied by the sum of (1) outstanding shares of common stock of the Company, (2) outstanding common units of limited partnership interest in Boston Properties Limited Partnership (excluding common units held by the Company), (3) common units issuable upon conversion of all outstanding LTIP Units, assuming all conditions have been met for the conversion of the LTIP Units, (4) on and after February 6, 2015, which was the end of the performance period for 2012 OPP Units and thus the date earned, common units issuable upon conversion of 2012 OPP Units that were issued in the form of LTIP Units, (5) on and after February 4, 2016, which was the end of the performance period for 2013 MYLTIP Units and thus the date earned, common units issuable upon conversion of 2013 MYLTIP Units that were issued in the form of LTIP Units, (6) on and after February 3, 2017, which was the end of the performance period for 2014 MYLTIP Units and thus the date earned, common units issuable upon conversion of 2014 MYLTIP Units that were issued in the form of LTIP Units, (7) on and after February 4, 2018, which was the end of the performance period for 2015 MYLTIP Units and thus the date earned, common units issuable upon conversion of 2015 MYLTIP Units that were issued in the form of LTIP Units and (8) on and after February 9, 2019, which was the end of the performance period for 2016 MYLTIP Units and thus the date earned, common units issuable upon conversion of 2016 MYLTIP Units that were issued in the form of LTIP Units plus (z) outstanding shares of 5.25% Series B Cumulative Redeemable Preferred Stock multiplied by their fixed liquidation preference of $2,500 per share. The calculation of Consolidated Market Capitalization does not include LTIP Units issued in the form of MYLTIP Awards unless and until certain performance thresholds are achieved and they are earned. Because their three-year performance periods have not yet ended, 2017, 2018 and 2019 MYLTIP Units are not included.

The Company also presents BXP’s Share of Market Capitalization, which is calculated in a similar manner, except that BXP’s Share of Debt is utilized instead of the Company’s Consolidated Debt in both the numerator and the denominator. The Company presents these ratios because its degree of leverage could affect its ability to obtain additional financing for working capital, capital expenditures, acquisitions, development or other general corporate purposes and because different investors and lenders consider one or both of these ratios. Investors should understand that these ratios are, in part, a function of the market price of the common stock of the Company, and as such will fluctuate with changes in such price and do not necessarily reflect the Company’s capacity to incur additional debt to finance its activities or its ability to manage its existing debt obligations. However, for a company like Boston Properties, Inc., whose assets are primarily income-producing real estate, these ratios may provide investors with an alternate indication of leverage, so long as they are evaluated along with the ratio of indebtedness to other measures of asset value used by financial analysts and other financial ratios, as well as the various components of the Company’s outstanding indebtedness.

54

Q4 2019
Definitions (continued)

Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate (EBITDAre)

Pursuant to the definition of Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate adopted by the Board of Governors of the National Association of Real Estate Investment Trusts (“Nareit”), the Company calculates EBITDAre as net income (loss) attributable to Boston Properties, Inc. common shareholders, the most directly comparable GAAP financial measure, plus net income attributable to noncontrolling interests, interest expense, losses (gains) from early extinguishments of debt, depreciation and amortization expense, impairment loss and adjustments to reflect the Company’s share of EBITDAre from unconsolidated joint ventures less gains on sales of real estate. EBITDAre is a non-GAAP financial measure. The Company uses EBITDAre internally as a performance measure and believes EBITDAre provides useful information to investors regarding its financial condition and results of operations at the corporate level because, when compared across periods, EBITDAre reflects the impact on operations from trends in occupancy rates, rental rates, operating costs, general and administrative expenses and acquisition and development activities on an unleveraged basis, providing perspective not immediately apparent from net (loss) income attributable to Boston Properties, Inc. common shareholders.

In some cases the Company also presents (A) BXP’s Share of EBITDAre – cash, which is BXP’s Share of EBITDAre after eliminating the effects of straight-line rent (excluding the impact related to deferred revenue related to improvements to long-lived assets paid for by a tenant), fair value lease revenue and non-cash termination income adjustment (fair value lease amounts) and adding straight-line ground rent expense, stock-based compensation expense and lease transaction costs that qualify as rent inducements, and (B) Annualized EBITDAre, which is EBITDAre for the applicable fiscal quarter ended multiplied by four (4). Presenting BXP’s Share of EBITDAre – cash allows investors to compare EBITDAre across periods without taking into account the effect of certain non-cash rental revenues, ground rent expense and stock based compensation expense. Similar to depreciation and amortization, because of historical cost accounting, fair value lease revenue may distort operating performance measures at the property level. Additionally, presenting EBITDAre excluding the impact of straight-line rent provides investors with an alternative view of operating performance at the property level that more closely reflects rental revenue generated at the property level without regard to future contractual increases in rental rates. In addition, the Company’s management believes that the presentation of Annualized EBITDAre provides useful information to investors regarding the Company’s results of operations because it enables investors to more easily compare quarterly EBITDAre to EBITDAre from full fiscal years.

The Company’s computation of EBITDAre may not be comparable to EBITDAre reported by other REITs or real estate companies that do not define the term in accordance with the current Nareit definition or that interpret the current Nareit definition differently.  The Company believes that in order to facilitate a clear understanding of its operating results, EBITDAre should be examined in conjunction with net income attributable to Boston Properties, Inc. common shareholders as presented in the Company’s consolidated financial statements. EBITDAre should not be considered a substitute to net income attributable to Boston Properties, Inc. common shareholders in accordance with GAAP or any other GAAP financial measures and should only be considered together with and as a supplement to the Company’s financial information prepared in accordance with GAAP.

Fixed Charge Coverage Ratio

Fixed Charge Coverage Ratio equals BXP’s Share of EBITDAre – cash divided by Total Fixed Charges. BXP’s Share of EBITDAre – cash is a non-GAAP financial measure equal to BXP’s Share of EBITDAre after eliminating the effects of straight-line rent (excluding the impact related to deferred revenue related to improvements to long-lived assets paid for by a tenant), fair value lease revenue and non-cash termination income adjustment (fair value lease amounts) and adding straight-line ground rent expense, stock-based compensation expense and lease transaction costs that qualify as rent inducements. Total Fixed Charges is also a non-GAAP financial measure equal to the sum of BXP’s Share of interest expense, capitalized interest, maintenance capital expenditures, hotel improvements, equipment upgrades and replacements and preferred dividends/distributions less hedge amortization and amortization of financing costs. The Company believes that the presentation of its Fixed Charge Coverage Ratio provides investors with useful information about the Company’s financial performance as it relates to overall financial flexibility and balance sheet management. Furthermore, the Company believes that the Fixed Charge Coverage Ratio is frequently used by analysts, rating agencies and other interested parties in the evaluation of the Company’s performance as a REIT and, as a result, by presenting the Fixed Charge Coverage Ratio the Company assists these parties in their evaluations.  The Company’s calculation of its Fixed Charge Coverage Ratio may not be comparable to the ratios reported by other REITs or real estate companies that define the term differently and should only be considered together with and as a supplement to the Company’s financial information prepared in accordance with GAAP. For clarification purposes, this ratio does not include gains (losses) from early extinguishments of debt.

Funds Available for Distribution (FAD) and FAD Payout Ratio

In addition to FFO, which is defined on the following page, the Company presents Funds Available for Distribution to common shareholders and common unitholders (FAD), which is a non-GAAP financial measure that is calculated by (1) adding to FFO lease transaction costs that qualify as rent inducements, non-real estate depreciation, non-cash losses (gains) from early extinguishments of debt, stock-based compensation expense, partners’ share of consolidated and unconsolidated joint venture 2nd generation tenant improvement and leasing commissions (included in the period in which the lease commences) and unearned portion of capitalized fees, (2) eliminating the effects of straight-line rent, straight-line ground rent expense adjustment, hedge amortization and fair value lease revenue, and (3) subtracting maintenance capital expenditures, hotel improvements, equipment upgrades and replacements, 2nd generation tenant improvement and leasing commissions (included in the period in which the lease commences), non-cash termination income adjustment (fair value lease amounts) and impairments of non-depreciable real estate. The Company believes that the presentation of FAD provides useful information to investors regarding the Company’s results of operations because FAD provides supplemental information regarding the Company’s operating performance that would not otherwise be available and may be useful to investors in assessing the Company’s operating performance. Additionally, although the Company does not consider FAD to be a liquidity measure, as it does not make adjustments to reflect changes in working capital or the actual timing of the payment of income or expense items that are accrued in the period, the Company believes that FAD may provide investors with useful supplemental information regarding the Company’s ability to generate cash from its operating performance and the impact of the Company’s operating performance on its ability to make distributions to its shareholders. Furthermore, the Company believes that FAD is frequently used by analysts, investors and other interested parties in the evaluation of its performance as a REIT and, as a result, by presenting FAD the Company is assisting these parties in their evaluation. FAD should not be considered as a substitute for net income (loss) attributable to Boston Properties, Inc.’s common shareholders determined in accordance with GAAP or any other GAAP financial measures and should only be considered together with and as a supplement to the Company’s financial information prepared in accordance with GAAP.

FAD Payout Ratio is defined as distributions to common shareholders and unitholders (excluding any special distributions) divided by FAD.

55

Q4 2019
Definitions (continued)

Funds from Operations (FFO)

Pursuant to the revised definition of Funds from Operations adopted by the Board of Governors of Nareit, the Company calculates Funds from Operations, or “FFO,” by adjusting net income (loss) attributable to Boston Properties, Inc. common shareholders (computed in accordance with GAAP) for gains (or losses) from sales of properties, impairment losses on depreciable real estate consolidated on the Company’s balance sheet, impairment losses on its investments in unconsolidated joint ventures driven by a measurable decrease in the fair value of depreciable real estate held by the unconsolidated joint ventures and real estate-related depreciation and amortization. FFO is a non-GAAP financial measure, but the Company believes the presentation of FFO, combined with the presentation of required GAAP financial measures, has improved the understanding of operating results of REITs among the investing public and has helped make comparisons of REIT operating results more meaningful. Management generally considers FFO and FFO per share to be useful measures for understanding and comparing the Company’s operating results because, by excluding gains and losses related to sales of previously depreciated operating real estate assets, impairment losses and real estate asset depreciation and amortization (which can differ across owners of similar assets in similar condition based on historical cost accounting and useful life estimates), FFO and FFO per share can help investors compare the operating performance of a company’s real estate across reporting periods and to the operating performance of other companies.

The Company’s computation of FFO may not be comparable to FFO reported by other REITs or real estate companies that do not define the term in accordance with the current Nareit definition or that interpret the current Nareit definition differently.  In order to facilitate a clear understanding of the Company’s operating results, FFO should be examined in conjunction with net income attributable to Boston Properties, Inc. common shareholders as presented in the Company’s consolidated financial statements. FFO should not be considered as a substitute for net income attributable to Boston Properties, Inc. common shareholders (determined in accordance with GAAP) or any other GAAP financial measures and should only be considered together with and as a supplement to the Company’s financial information prepared in accordance with GAAP.

In-Service Properties

The Company treats a property as being “in-service” upon the earlier of (1) lease-up and completion of tenant improvements or (2) one year after cessation of major construction activity as determined under GAAP. The determination as to when an entire property should be treated as “in-service” involves a degree of judgment and is made by management based on the relevant facts and circumstances of the particular property. For portfolio operating and occupancy statistics, the Company specifies a single date for treating a property as “in-service,” which is generally later than the date the property is partially placed in-service under GAAP. Under GAAP, a property may be placed in-service in stages as construction is completed and the property is held available for occupancy. In addition, under GAAP, when a portion of a property has been substantially completed and either occupied or held available for occupancy, the Company ceases capitalizing costs on that portion, even though it may not treat the property as being “in-service,” and continues to capitalize only those costs associated with the portion still under construction. In-service properties include properties held by the Company’s unconsolidated joint ventures.

Interest Coverage Ratio

Interest Coverage Ratio, calculated including and excluding capitalized interest, is a non-GAAP financial measure equal to BXP’s Share of EBITDAre – cash divided by Adjusted interest expense. BXP’s Share of EBITDAre – cash is a non-GAAP financial measure equal to BXP’s Share of EBITDAre after eliminating the effects of straight-line rent (excluding the impact related to deferred revenue related to improvements to long-lived assets paid for by a tenant), fair value lease revenue and non-cash termination income adjustment (fair value lease amounts) and adding straight-line ground rent expense, stock-based compensation expense and lease transaction costs that qualify as rent inducements. Adjusted interest expense excluding capitalized interest is equal to BXP’s Share of interest expense less (1) BXP’s Share of hedge amortization and (2) BXP’s Share of amortization of financing costs. Adjusted interest expense including capitalized interest is calculated in the same manner but adds back BXP’s Share of capitalized interest. The Company believes that the presentation of its Interest Coverage Ratio provides useful information about the Company’s financial condition because it provides investors additional information on the Company’s ability to meet its debt obligations and incur additional indebtedness. In addition, by analyzing interest coverage ratios over a period of time, trends may emerge that provide investors a better sense of whether a company’s financial condition is improving or declining. The ratios may also be used to compare the financial condition of different companies, which can help when making an investment decision. The Company presents its Interest Coverage Ratio in two ways - including capitalized interest and excluding capitalized interest. GAAP requires the capitalization of interest expense during development. Therefore, for a company like Boston Properties, Inc. that is an active developer of real estate, presenting the Interest Coverage Ratio (excluding capitalized interest) provides an alternative measure of financial condition that may be more indicative of the Company’s ability to meet its interest expense obligations and therefore its overall financial condition. For clarification purposes, this ratio does not include gains (losses) from early extinguishments of debt.

Market Rents

Market Rents used by the Company in calculating Average Economic Occupancy are based on the current market rates set by the managers of the Company’s residential properties based on their experience in renting their residential property’s units and publicly available market data. Trends in market rents for a region as reported by others could therefore vary materially. Market Rents for a period are based on the average Market Rents during that period and do not reflect any impact for cash concessions.

Net Debt

Net Debt is equal to (A) the Company’s consolidated debt plus special dividends payable (if any) less (B) cash and cash equivalents and cash held in escrow for potential Section 1031 like kind exchange(s). The Company believes that the presentation of Net Debt provides useful information to investors because the Company reviews Net Debt as part of the management of its overall financial flexibility, capital structure and leverage. In particular, Net Debt is an important component of the Company’s ratio of BXP’s Share of Net Debt to BXP’s Share of EBITDAre.  BXP’s Share of Net Debt is calculated in a similar manner to Net Debt, except that BXP’s Share of Debt and BXP’s Share of cash are utilized instead of the Company’s consolidated debt and cash in the calculation. The Company believes BXP’s Share of Net Debt to BXP’s Share of EBITDAre is useful to investors because it provides an alternative measure of the Company’s financial flexibility, capital structure and leverage based on its percentage ownership interest in all of its assets. Furthermore, certain debt rating agencies, creditors and credit analysts monitor the Company’s Net Debt as part of their assessments of its business. The Company may utilize a considerable portion of its cash and cash equivalents at any given time for purposes other than debt reduction. In addition, cash and cash equivalents and cash held in escrow for potential Section 1031 like kind exchange(s) may not be solely controlled by the Company. The deduction of these items from consolidated debt in the calculation of Net Debt therefore should not be understood to mean that these items are available exclusively for debt reduction at any given time.

56

Q4 2019
Definitions (continued)

Net Operating Income (NOI)

Net operating income (NOI) is a non-GAAP financial measure equal to net income attributable to Boston Properties, Inc. common shareholders, the most directly comparable GAAP financial measure, plus (1) preferred dividends, net income attributable to noncontrolling interests, corporate general and administrative expense, payroll and related costs from management services contracts, transaction costs, impairment losses, depreciation and amortization expense, losses from early extinguishments of debt and interest expense, less (2) development and management services revenue, direct reimbursements of payroll and related costs from management services contracts, income (loss) from unconsolidated joint ventures, gains (losses) on sales of real estate, gains (losses) from investments in securities and interest and other income. In some cases, the Company also presents (1) NOI – cash, which is NOI after eliminating the effects of straight-line rent (excluding the impact related to deferred revenue related to improvements to long-lived assets paid for by a tenant), fair value lease revenue, straight-line ground rent expense adjustment and lease transaction costs that qualify as rent inducements in accordance with GAAP, and (2) NOI and NOI – cash, in each case excluding termination income.

The Company uses these measures internally as performance measures and believes they provide useful information to investors regarding the Company’s results of operations and financial condition because, when compared across periods, they reflect the impact on operations from trends in occupancy rates, rental rates, operating costs and acquisition and development activity on an unleveraged basis, providing perspective not immediately apparent from net income. For example, interest expense is not necessarily linked to the operating performance of a real estate asset and is often incurred at the corporate level as opposed to the property level. Similarly, interest expense may be incurred at the property level even though the financing proceeds may be used at the corporate level (e.g., used for other investment activity). In addition, depreciation and amortization expense because of historical cost accounting and useful life estimates, may distort operating performance measures at the property level. Presenting NOI – cash allows investors to compare NOI performance across periods without taking into account the effect of certain non-cash rental revenues and ground rent expenses. Similar to depreciation and amortization expense, fair value lease revenues, because of historical cost accounting, may distort operating performance measures at the property level. Additionally, presenting NOI excluding the impact of the straight-lining of rent provides investors with an alternative view of operating performance at the property level that more closely reflects net cash generated at the property level on an unleveraged basis. Presenting NOI measures that exclude termination income provides investors with additional information regarding operating performance at a property level that allows them to compare operating performance between periods without taking into account termination income, which can distort the results for any given period because they generally represent multiple months or years of a tenant’s rental obligations that are paid in a lump sum in connection with a negotiated early termination of the tenant’s lease and are not reflective of the core ongoing operating performance of the Company’s properties.

Rental Obligations

Rental Obligations is defined as the contractual base rents (but excluding percentage rent) and budgeted reimbursements from tenants under existing leases. These amounts exclude rent abatements.

Rental Revenue

Rental Revenue is equal to Total revenue, the most directly comparable GAAP financial measure, less development and management services revenue and direct reimbursements of payroll and related costs from management services contracts. Upon the adoption of Accounting Standards Update No. 2016-02 “Leases” on January 1, 2019, service income from tenants is included in Lease revenue. Prior to adoption, these amounts were included in the line item for Development and management services revenue. The Company uses Rental Revenue internally as a performance measure and in calculating other non-GAAP financial measures (e.g., NOI), which provides investors with information regarding our performance that is not immediately apparent from the comparable non-GAAP measures and allows investors to compare operating performance between periods. The Company also presents Rental Revenue (excluding termination income) because termination income can distort the results for any given period because it generally represents multiple months or years of a tenant’s rental obligations that are paid in a lump sum in connection with a negotiated early termination of the tenant’s lease and does not reflect the core ongoing operating performance of the Company’s properties.

Same Properties

In the Company’s analysis of NOI, particularly to make comparisons of NOI between periods meaningful, it is important to provide information for properties that were in-service and owned by the Company throughout each period presented. The Company refers to properties acquired or placed in-service prior to the beginning of the earliest period presented and owned by the Company through the end of the latest period presented as “Same Properties.” “Same Properties” therefore exclude properties placed in-service, acquired, repositioned or in development or redevelopment after the beginning of the earliest period presented or disposed of prior to the end of the latest period presented. Accordingly, it takes at least one year and one quarter after a property is acquired or treated as “in-service” for that property to be included in “Same Properties.” Pages 21 - 24 indicate by footnote the “In-Service Properties” that are not included in “Same Properties.”

57

Q4 2019
Reconciliations

(unaudited and in thousands)

BXP’s Share of select items
Three Months Ended
31-Dec-19 30-Sep-19
Revenue $ 757,501 $ 743,553
Partners’ share of revenue from consolidated joint ventures (JVs) (75,000 ) (75,714 )
BXP’s share of revenue from unconsolidated JVs 40,146 36,332
BXP’s Share of revenue $ 722,647 $ 704,171
Straight-line rent $ 40,460 $ (16,803 )
Partners’ share of straight-line rent from consolidated JVs (3,431 ) 12,633
BXP’s share of straight-line rent from unconsolidated JVs 6,472 2,266
BXP’s Share of straight-line rent $ 43,501 $ (1,904 )
Straight-line rent from deferred revenue ^1^ $ — $ (36,926 )
Partners’ share of straight-line rent from deferred revenue from consolidated JVs ^1^ — 14,770
BXP’s share of straight-line rent from deferred revenue from unconsolidated JVs — —
BXP’s Share of straight-line rent from deferred revenue ^1^ $ — $ (22,156 )
Fair value lease revenue ^2^ $ 2,965 $ 4,961
Partners’ share of fair value lease revenue from consolidated JVs ^2^ (633 ) (1,463 )
BXP’s share of fair value lease revenue from unconsolidated JVs ^2^ 966 969
BXP’s Share of fair value lease revenue ^2^ $ 3,298 $ 4,467
Lease termination income $ 1,397 $ 1,960
Partners’ share of termination income from consolidated JVs — —
BXP’s share of termination income from unconsolidated JVs — —
BXP’s Share of termination income $ 1,397 $ 1,960
Non-cash termination income adjustment (fair value lease amounts) $ — $ —
Partners’ share of non-cash termination income adjustment (fair value lease amounts) from consolidated JVs — —
BXP’s share of non-cash termination income adjustment (fair value lease amounts) from unconsolidated JVs — —
BXP’s Share of non-cash termination income adjustment (fair value lease amounts) $ — $ —
Internal leasing and external legal costs that were to be capitalized prior to the adoption of ASU 2016-02 - “Leases” on January 1, 2019 $ 886 $ 1,478
Partners’ share of internal leasing and external legal costs from consolidated JVs that were to be capitalized prior to the adoption of ASU 2016-02 - “Leases” on January 1, 2019 (161 ) (27 )
BXP’s share of internal leasing and external legal costs from unconsolidated JVs that were to be capitalized prior to the adoption of ASU 2016-02 - “Leases” on January 1, 2019 119 72
BXP’s Share of internal leasing and external legal costs that were to be capitalized prior to the adoption of ASU 2016-02 - “Leases” on January 1, 2019 $ 844 $ 1,523
Hedge amortization $ 1,579 $ 1,579
Partners’ share of hedge amortization from consolidated JVs (144 ) (144 )
BXP’s share of hedge amortization from unconsolidated JVs — —
BXP’s Share of hedge amortization $ 1,435 $ 1,435
Straight-line ground rent expense adjustment $ 1,016 $ 1,019
Partners’ share of straight-line ground rent expense adjustment from consolidated JVs — —
BXP’s share of straight-line ground rent expense adjustment from unconsolidated JVs 40 —
BXP’s Share of straight-line ground rent expense adjustment $ 1,056 $ 1,019
Depreciation and amortization $ 169,897 $ 165,862
Noncontrolling interests in property partnerships’ share of depreciation and amortization (18,116 ) (17,402 )
BXP’s share of depreciation and amortization from unconsolidated JVs 14,458 13,745
BXP’s Share of depreciation and amortization $ 166,239 $ 162,205

58

Q4 2019
Reconciliations (continued)
BXP’s Share of select items (continued)
--- --- --- --- --- --- ---
Three Months Ended
31-Dec-19 30-Sep-19
Lease transaction costs that qualify as rent inducements ^3^ $ 2,170 $ 2,140
Partners’ share of lease transaction costs that qualify as rent inducements from consolidated JVs ^3^ (168 ) (281 )
BXP’s share of lease transaction costs that qualify as rent inducements from unconsolidated JVs ^3^ 7,401 182
BXP’s Share of lease transaction costs that qualify as rent inducements ^3^ $ 9,403 $ 2,041
2nd generation tenant improvements and leasing commissions $ 91,627 $ 124,751
Partners’ share of 2nd generation tenant improvements and leasing commissions from consolidated JVs (5,609 ) (56,051 )
BXP’s share of 2nd generation tenant improvements and leasing commissions from unconsolidated JVs 23 1,499
BXP’s Share of 2nd generation tenant improvements and leasing commissions $ 86,041 $ 70,199
Maintenance capital expenditures ^4^ $ 25,818 $ 31,140
Partners’ share of maintenance capital expenditures from consolidated JVs ^4^ (998 ) (548 )
BXP’s share of maintenance capital expenditures from unconsolidated JVs ^4^ 637 671
BXP’s Share of maintenance capital expenditures ^4^ $ 25,457 $ 31,263
Interest expense $ 102,880 $ 106,471
Partners’ share of interest expense from consolidated JVs (10,902 ) (10,720 )
BXP’s share of interest expense from unconsolidated JVs 10,774 9,795
BXP’s Share of interest expense $ 102,752 $ 105,546
Capitalized interest $ 13,658 $ 16,184
Partners’ share of capitalized interest from consolidated JVs (1,264 ) (1,466 )
BXP’s share of capitalized interest from unconsolidated JVs 2,620 2,559
BXP’s Share of capitalized interest $ 15,014 $ 17,277
Amortization of financing costs $ 3,300 $ 3,329
Partners’ share of amortization of financing costs from consolidated JVs (382 ) (382 )
BXP’s share of amortization of financing costs from unconsolidated JVs 423 203
BXP’s Share of amortization of financing costs $ 3,341 $ 3,150

_____________

^1^ Represents the straight-line impact related to deferred revenue from a tenant.  The tenant paid for improvements to a long-lived asset of the Company resulting in deferred revenue for the period until the asset was substantially complete, which occurred in the third quarter of 2019.
^2^ Represents the net adjustment for above- and below-market leases that are being amortized over the terms of the respective leases in place at the property acquisition dates.
--- ---
^3^ Consists of lease transaction costs that qualify as rent inducements in accordance with GAAP. Lease transaction costs are generally included in 2nd generation tenant improvements and leasing commissions in the period the lease commences.
--- ---
^4^ Maintenance capital expenditures do not include planned capital expenditures related to acquisitions and repositioning capital expenditures.
--- ---

59

Q4 2019
Reconciliations (continued)

for the three months ended December 31, 2019

(unaudited and dollars in thousands)

Norges Joint Ventures
Times Square Tower
601 Lexington Avenue / <br>One Five Nine East 53rd Street
CONSOLIDATED JOINT VENTURES 767 Fifth Avenue 100 Federal Street Total Consolidated
(The GM Building) Atlantic Wharf Office Joint Ventures
Revenue
Lease ^1^ $ 67,017 $ 96,417 $ 163,434
Straight-line rent 4,070 4,007 8,077
Fair value lease revenue 1,448 119 1,567
Termination income — — —
Total lease revenue 72,535 100,543 173,078
Parking and other 2 1,597 1,599
Total rental revenue ^2^ 72,537 102,140 174,677
Expenses
Operating 30,474 35,960 66,434
Net Operating Income (NOI) 42,063 66,180 108,243
Other income (expense)
Development and management services revenue — 49 49
Interest and other income 433 587 1,020
Interest expense (21,396 ) (5,216 ) (26,612 )
Depreciation and amortization expense (19,878 ) (22,712 ) (42,590 )
General and administrative expense (64 ) (300 ) (364 )
Total other income (expense) (40,905 ) (27,592 ) (68,497 )
Net income $ 1,158 $ 38,588 $ 39,746
BXP’s nominal ownership percentage 60.00% 55.00%
Partners’ share of NOI (after income allocation to private REIT shareholders) ^3^ $ 16,165 $ 28,928 $ 45,093
BXP’s share of NOI (after income allocation to private REIT shareholders) $ 25,898 $ 37,252 $ 63,150
Unearned portion of capitalized fees ^4^ $ 901 $ 399 $ 1,300
Partners’ share of select items ^3^
Partners’ share hedge amortization $ 144 $ — $ 144
Partners’ share of amortization of financing costs $ 346 $ 36 $ 382
Partners’ share of capitalized interest $ — $ 1,264 $ 1,264
Partners’ share of lease transaction costs that qualify as rent inducements $ — $ 168 $ 168
Partners’ share of management and other fees $ 660 $ 874 $ 1,534
Partners’ share of basis differential and other adjustments $ (20 ) $ 1 $ (19 )
Reconciliation of Partners’ share of EBITDAre ^3^
Partners’ NCI $ (173 ) $ 16,511 $ 16,338
Add:
Partners’ share of interest expense 8,555 2,347 10,902
Partners’ share of depreciation and amortization expense after BXP’s basis differential 7,931 10,185 18,116
Partners’ share of EBITDAre $ 16,313 $ 29,043 $ 45,356
Reconciliation of Partners’ share of Net Operating Income (Loss) (NOI) ^3^
Rental revenue ^2^ $ 29,015 $ 45,963 $ 74,978
Less: Termination income — — —
Rental revenue (excluding termination income) ^2^ 29,015 45,963 74,978
Less: Operating expenses (including partners’ share of management and other fees) 12,850 17,056 29,906
Income allocation to private REIT shareholders — (21 ) (21 )
NOI (excluding termination income and after income allocation to private REIT shareholders) $ 16,165 $ 28,928 $ 45,093
Rental revenue (excluding termination income) ^2^ $ 29,015 $ 45,963 $ 74,978
Less: Straight-line rent 1,628 1,803 3,431
Fair value lease revenue 579 54 633
Add: Lease transaction costs that qualify as rent inducements — 168 168
Subtotal 26,808 44,274 71,082
Less: Operating expenses (including partners’ share of management and other fees) 12,850 17,056 29,906
Income allocation to private REIT shareholders — (21 ) (21 )
NOI - cash (excluding termination income and after income allocation to private REIT shareholders) $ 13,958 $ 27,239 $ 41,197

60

Q4 2019
Reconciliations (continued)

for the three months ended December 31, 2019

(unaudited and dollars in thousands)

CONSOLIDATED JOINT VENTURES
Norges Joint Ventures
Times Square Tower
601 Lexington Avenue / <br>One Five Nine East 53rd Street
767 Fifth Avenue 100 Federal Street Total Consolidated
Reconciliation of Partners’ share of Revenue ^3^ (The GM Building) Atlantic Wharf Office Joint Ventures
Rental revenue ^2^ $ 29,015 $ 45,963 $ 74,978
Add: Development and management services revenue — 22 22
Revenue $ 29,015 $ 45,985 $ 75,000

_________

^1^ Lease revenue includes recoveries from tenants and service income from tenants.^^
^2^ See the Definitions and Reconciliations sections of this Supplemental package starting on page 54.
--- ---
^3^ Amounts represent the partners’ share based on their respective ownership percentage.
--- ---
^4^ Capitalized fees are eliminated in consolidation and recognized over the life of the asset as depreciation and amortization are added back to the Company’s net income.
--- ---

61

Q4 2019
Reconciliations (continued)

for the three months ended December 31, 2019

(unaudited and dollars in thousands)

UNCONSOLIDATED JOINT VENTURES
Market Square North Metropolitan Square 901 New York Avenue Annapolis Junction ^1^ 500 North Capitol Street, N.W. Colorado Center Santa Monica Business Park The Hub on Causeway Other Joint Ventures ^2^ Total Unconsolidated Joint Ventures
Revenue
Lease ^3^ $ 4,909 $ 3,224 $ 7,897 $ 1,915 $ 4,436 $ 19,086 $ 15,647 $ 1,903 $ 1,690 $ 60,707
Straight-line rent 512 3,221 85 55 21 482 1,091 5,215 3,079 13,761
Fair value lease revenue — — — — — 9 953 — — 962
Termination income — — — — — — — — — —
Total lease revenue 5,421 6,445 7,982 1,970 4,457 19,577 17,691 7,118 4,769 75,430
Parking and other 209 643 348 55 123 2,659 2,159 215 1,115 7,526
Total rental revenue ^4^ 5,630 7,088 8,330 2,025 4,580 22,236 19,850 7,333 5,884 82,956
Expenses
Operating 2,589 3,487 3,676 753 1,861 6,397 7,828 3,872 2,917 ^5^ 33,380
Net operating income 3,041 3,601 4,654 1,272 2,719 15,839 12,022 3,461 2,967 49,576
Other income/(expense)
Development and management services revenue 2 — — 4 — — — — — 6
Interest and other income 75 — 141 70 21 223 1 43 183 757
Transaction costs — — — — — — — — (1,000 ) (1,000 )
Interest expense (1,432 ) (1,789 ) (2,075 ) (521 ) (1,128 ) (5,033 ) (7,031 ) (2,105 ) (1,250 ) (22,364 )
Depreciation and amortization expense (1,113 ) (1,658 ) (1,534 ) (666 ) (881 ) (5,273 ) (9,329 ) (2,224 ) (2,676 ) (25,354 )
General and administrative expense (1 ) (42 ) (24 ) (1 ) — — (26 ) (18 ) (30 ) (142 )
Gain on sale of real estate — — — — — — — — (53 ) (53 )
Total other income/(expense) (2,469 ) (3,489 ) (3,492 ) (1,114 ) (1,988 ) (10,083 ) (16,385 ) (4,304 ) (4,826 ) (48,150 )
Net income/(loss) $ 572 $ 112 $ 1,162 $ 158 $ 731 $ 5,756 $ (4,363 ) $ (843 ) $ (1,859 ) $ 1,426
BXP’s nominal ownership percentage 50 % 20 % 25 % 50 % 30 % 50 % 55 % 50 %
BXP’s share of amortization of financing costs $ 10 $ 5 $ 22 ^6^ $ 15 $ 4 $ 13 $ 72 $ 129 $ 153 $ 423
BXP’s share of capitalized interest $ — $ 101 $ — ^6^ $ — $ — $ — $ — $ 814 $ 1,705 $ 2,620
BXP’s share of non-cash termination income adjustment (fair value lease amounts) $ — $ — $ — ^6^ $ — $ — $ — $ — $ — $ — $ —
Income/(loss) from unconsolidated joint ventures $ 239 $ 23 $ 264 ^6^ $ 77 $ 221 $ 1,922 $ (2,404 ) $ (401 ) $ (877 ) $ (936 )
Add:
BXP’s share of interest expense 716 358 1,038 ^6^ 261 338 2,517 3,867 1,053 626 10,774
BXP’s share of depreciation and amortization expense 604 328 1,055 ^6^ 335 263 4,535 ^7^ 5,125 1,096 1,117 14,458
Less:
BXP’s share of gain on sale of real estate — — — — — — — — (32 ) (32 )
BXP’s share of EBITDAre $ 1,559 $ 709 $ 2,357 ^6^ $ 673 $ 822 $ 8,974 $ 6,588 $ 1,748 $ 898 $ 24,328

62

Q4 2019
Reconciliations (continued)
UNCONSOLIDATED JOINT VENTURES
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Reconciliation of BXP’s share of Net Operating Income/(Loss) Market Square North Metropolitan Square 901 New York Avenue Annapolis Junction ^1^ 500 North Capitol Street, N.W. Colorado Center Santa Monica Business Park The Hub on Causeway Other Joint Ventures ^2^ Total Unconsolidated Joint Ventures
BXP’s share of rental revenue ^4^ $ 2,815 $ 1,418 $ 4,165 ^6^ $ 1,013 $ 1,374 $ 12,061 ^7^ $ 10,918 $ 3,667 $ 2,712 $ 40,143
BXP’s share of operating expenses 1,295 697 1,838 ^6^ 377 558 3,199 4,305 1,936 1,351 15,556
BXP’s share of net operating income/(loss) 1,520 721 2,327 ^6^ 636 816 8,862 6,613 1,731 1,361 24,587
Less:
BXP’s share of termination income — — — ^6^ — — — — — — —
BXP’s share of net operating income/(loss) (excluding termination income) 1,520 721 2,327 ^6^ 636 816 8,862 6,613 1,731 1,361 24,587
Less:
BXP’s share of straight-line rent 256 644 43 ^6^ 28 6 747 ^7^ 600 2,608 1,540 6,472
BXP’s share of fair value lease revenue — — — ^6^ — — 442 ^7^ 524 — — 966
Add:
BXP’s share of straight-line ground rent expense adjustment — — — — — — — — 40 40
BXP’s share of lease transaction costs that qualify as rent inducements — 233 2 ^6^ — — 411 — 2,103 4,652 7,401
BXP’s share of net operating income/(loss) - cash (excluding termination income) $ 1,264 $ 310 $ 2,286 ^6^ $ 608 $ 810 $ 8,084 ^7^ $ 5,489 $ 1,226 $ 4,473 $ 24,590
Reconciliation of BXP’s share of Revenue
BXP’s share of rental revenue ^4^ $ 2,815 $ 1,418 $ 4,165 ^6^ $ 1,013 $ 1,374 $ 12,061 ^7^ $ 10,918 $ 3,667 $ 2,712 $ 40,143
Add:
BXP’s share of development and management services revenue 1 — — 2 — — — — — 3
BXP’s share of revenue $ 2,816 $ 1,418 $ 4,165 ^6^ $ 1,015 $ 1,374 $ 12,061 ^7^ $ 10,918 $ 3,667 $ 2,712 $ 40,146

_____________

^1^ Annapolis Junction includes three in-service properties and two undeveloped land parcels.
^2^ Includes 1001 6th Street, Dock 72, 7750 Wisconsin Avenue, 1265 Main Street, Wisconsin Place Parking Facility, 3 Hudson Boulevard, 540 Madison Avenue and Platform 16.
--- ---
^3^ Lease revenue includes recoveries from tenants and service income from tenants.^^
--- ---
^4^ See the Definitions and Reconciliations sections of this Supplemental package starting on page 54.
--- ---
^5^ Includes approximately $80 of straight-line ground rent expense.
--- ---
^6^ Reflects the allocation percentages pursuant to the achievement of specified investment return thresholds as provided for in the joint venture agreement.
--- ---
^7^ The Company’s purchase price allocation under ASC 805 for Colorado Center differs from the historical basis of the venture resulting in the majority of the basis differential for this venture.
--- ---

63

Q4 2019
Consolidated Income Statement - prior year

(unaudited and in thousands, except per share amounts)

Three Months Ended
31-Dec-18
Revenue
Rental
Base rent $ 541,902
Recoveries from tenants 109,265
Parking and other 27,831
Total rental revenue 678,998
Hotel revenue 11,745
Development and management services 12,195
Direct reimbursements of payroll and related costs from management services contracts 2,219
Total revenue 705,157
Expenses
Operating
Rental 253,043
Hotel 8,221
General and administrative 27,683
Payroll and related costs from management services contracts 2,219
Transaction costs 195
Depreciation and amortization 165,439
Total expenses 456,800
Other income (expense)
Income from unconsolidated joint ventures 5,305
Gains on sales of real estate 59,804
Interest and other income 3,774
Impairment losses (11,812 )
Losses from early extinguishments of debt (16,490 )
Losses from investments in securities (3,319 )
Interest expense (100,378 )
Net income 185,241
Net income attributable to noncontrolling interests
Noncontrolling interest in property partnerships (16,425 )
Noncontrolling interest - common units of the Operating Partnership (17,662 )
Net income attributable to Boston Properties, Inc. 151,154
Preferred dividends (2,625 )
Net income attributable to Boston Properties, Inc. common shareholders $ 148,529
INCOME PER SHARE OF COMMON STOCK (EPS)
Net income attributable to Boston Properties, Inc. per share - basic $ 0.96
Net income attributable to Boston Properties, Inc. per share - diluted $ 0.96

64

		Exhibit

Exhibit 99.2

bxplogohorizontalcolorrgba30.jpg

BOSTON PROPERTIES ANNOUNCES FOURTH QUARTER 2019 RESULTS; REPORTS EPS OF $0.91 AND FFO PER SHARE OF $1.87

Exceeds the Midpoint of EPS and FFO Guidance for Q4; Delivers 9% Year-over-Year Revenue Growth for FY 2019; Increases FY 2020 Guidance with Continued Growth Momentum

BOSTON, MA, January 28, 2020 - Boston Properties, Inc. (NYSE: BXP), the largest publicly-traded developer, owner and manager of Class A office properties in the United States, reported results today for the fourth quarter and full year ended December 31, 2019.

Financial highlights for the fourth quarter include:

• Revenue grew more than 7% to $757.5 million as compared to revenue of $705.2 million for the fourth quarter ended December 31, 2018.
• Net income was $140.8 million, or $0.91 per diluted share (EPS), compared to $148.5 million, or $0.96 per diluted share, for the quarter ended December 31, 2018, primarily due to gains on asset sales in 2018 that did not reoccur in 2019.
--- ---
• Funds from Operations (FFO) was $289.9 million, or $1.87 per diluted share, reflecting growth of 18% compared to FFO of $245.7 million, or $1.59 per diluted share, for the fourth quarter ended December 31, 2018.
--- ---
◦ FFO in the fourth quarter of $1.87 per diluted share was $0.02 per share greater than the midpoint of the Company’s fourth quarter guidance provided on October 29, 2019 primarily due to $0.02 per share of greater-than-projected portfolio performance.
--- ---

The Company provided guidance for the first quarter 2020 with projected EPS of $3.22 - $3.24 per diluted share and projected FFO of $1.80 - $1.82 per diluted share.

The Company also increased its full year 2020 EPS guidance by $2.45 at the midpoint and increased its full year 2020 FFO per diluted share guidance by $0.01 at the midpoint compared to guidance provided on October 29, 2019. The Company’s updated guidance for 2020 is:

• Projected EPS for 2020 of $5.91 - $6.09 per diluted share inclusive of $2.37 in expected gains on asset sales that are currently under agreement;
• Projected FFO for 2020 of $7.47 - $7.65 per diluted share, reflecting 8% year-over-year growth at the midpoint.
--- ---

See “EPS and FFO per Share Guidance” below.

Financial results for the year ended December 31, 2019 include:

• Net income attributable to common shareholders of $511.0 million, or $3.30 per diluted share (EPS), compared to $572.3 million, or $3.70 per diluted share, for FY 2018, primarily due to $1.06 of gains on asset sales in 2018 that did not reoccur at the same level in 2019, offset primarily by improved portfolio performance in 2019.

–more–

• FFO of $1.1 billion, or $7.01 per diluted share, reflecting 11% growth compared to FFO of $974.5 million, or $6.30 per diluted share, for the year ended December 31, 2018, primarily due to increases in same property performance and the benefit of developments delivered in 2019.

Fourth quarter and recent business highlights include:

• Entered into a joint venture with Alexandria Real Estate Equities to develop, own and operate approximately 1.1 million square feet of existing office and lab properties in South San Francisco, California, with the opportunity for approximately 640,000 square feet of additional future development.   Upon completion, the joint venture is expected to own an approximately 1.7 million square foot life science campus including a mix of office and lab buildings.  Boston Properties will have a 50% ownership interest in the joint venture once complete. Details of the transaction can be found in a separate press release issued today which can be found on the newsroom page of the Company’s website at www.bxp.com or here http://investors.bxp.com/latest-news.
• Secured approval from the City of San Francisco Planning Commission for the 4th and Harrison development project located in San Francisco’s Central SoMa District. The approval includes the Large Project Authorization for the design and massing of an 820,000 square foot project, as well as an initial allocation of 505,000 square feet under the San Francisco Office Development Annual Limitation Program (Prop M) for the first phase of the project.
--- ---
• Completed and fully placed in-service the following development projects in Q4 2019:
--- ---
◦ 145 Broadway, a 483,000 square foot property located in Cambridge, Massachusetts. The property is 98% leased to Akamai Technologies, Inc.
--- ---
◦ The Hub on Causeway - Podium, a 382,000 square foot project containing retail and office space located in Boston, Massachusetts. The project is 99% leased. The Hub on Causeway - Podium is part of a 1.3 million square foot mixed-use development project adjacent to the North Station transit center. The Company has a 50% ownership interest in the development.
--- ---
• Signed 1.7 million square feet of leases including:
--- ---
• Approximately 130,000 square feet of leases at 399 Park Avenue in New York, NY including approximately 49,000 square feet of leases with a new tenant.
--- ---
• Approximately 150,000 square feet of office leasing at 767 Fifth Avenue in New York, NY including a 41,000 square foot lease with a new tenant.
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• Approximately 440,000 square feet of office leasing in Reston, Virginia, including a 310,000 square foot renewal and a 75,000 square foot lease with a new tenant.
--- ---
• Approximately 270,000 square feet of renewals and expansions in the Company’s Los Angeles assets.
--- ---
• Increased portfolio occupancy to 93% in the Company’s in-service office properties, an increase of 160 bps from the fourth quarter of 2018.
--- ---
• Entered into an agreement for the sale of New Dominion Technology Park, a 493,000 square foot office park located in Herndon, Virginia for a gross sale price of $256.0 million, subject to standard closing conditions. The transaction is expected to close during the first quarter of 2020.
--- ---
• Repaid the bond financing collateralized by New Dominion Technology Park, Building One in Herndon, Virginia, totaling approximately $26.5 million in the fourth quarter of 2019. The bond
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–more–

financing bore interest at a weighted-average fixed rate of approximately 7.69% per annum and was scheduled to mature on January 15, 2021. The early repayment of the debt resulted in a charge of $1.5 million or $0.01 per diluted share in the fourth quarter of 2019.

• Increased the regular quarterly dividend by 3.2% to $0.98 per share of common stock. The aggregate common stock dividend for full year 2019 of $3.83 per common share represents an annual increase of $0.33 per share, or 9%, over the aggregate common stock dividend for full year 2018 and a total of 42% over the past three years.

Full year 2019 Business Highlights include:

• Commenced development of approximately 1.0 million square feet including:
◦ 325 Main Street at Kendall Center in Cambridge, Massachusetts, a 420,000 square foot (including retail) build-to-suit development project for Google.
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◦ A portion of 200 West Street, a 261,000 square foot Class A office property in Waltham, Massachusetts. The 126,000 square foot redevelopment is a conversion to laboratory space.
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◦ 2100 Pennsylvania Avenue, a 470,000 square foot property in the Foggy Bottom neighborhood of Washington, DC that will include approximately 440,000 square feet of Class A office space and 30,000 square feet of retail space. 66% of the office space is pre-leased to a large law firm.
--- ---
• Signed 7.6 million square feet of leases during the year. In addition to the fourth quarter leases, notable signed leases during the year include:
--- ---
◦ 850,000 square feet of leases with Google in Cambridge, Massachusetts for a term of 15 years.
--- ---
◦ A 545,000 square foot, 15-year lease with Bank of America at 100 Federal Street in Boston, Massachusetts.
--- ---
◦ 493,000 square feet of lease renewals with the U.S. government at New Dominion Technology Park in Herndon, Virginia for a term of 15 years.
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◦ A 338,000 square foot, 20-year lease with Shearman & Sterling, a global law firm at 599 Lexington Avenue in New York, NY.
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• Entered into a joint venture to develop Platform 16 in San Jose, California. Platform 16 consists of approximately 5.6 acres that will support the development of a 1.1 million square foot, Class A urban office campus near Diridon Station in downtown San Jose, California.
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• Acquired 880 and 890 Winter Street in Waltham, Massachusetts, two Class A office properties aggregating approximately 392,000 square feet.
--- ---
• Completed several dispositions with gross sales totaling approximately $406 million, and net cash proceeds of approximately $200 million.
--- ---
• Completed two bond offerings totaling $1.6 billion, including a $850 million green bond offering of 3.4% unsecured senior notes due 2029 and a $700 million bond offering of 2.9% unsecured senior notes due 2030.
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–more–

• Ranked in the top quadrant of the 2019 Global Real Estate Sustainability Benchmark (GRESB®) assessment, earning an eighth consecutive “Green Star” recognition and the highest GRESB 5-star Rating. Overall, the Company ranked among the top 4% of 964 worldwide participants. Also during the year, Boston Properties was selected as a 2019 ENERGY STAR® Partner of the Year. The Company was recognized by the U.S. Environmental Protection Agency (EPA) in Washington, DC. Earning an ENERGY STAR® Partner of the Year Award distinguishes corporate energy management programs, and is the highest level of EPA recognition.

The reported results are unaudited and there can be no assurance that these reported results will not vary from the final information for the quarter and year ended December 31, 2019. In the opinion of management, the Company has made all adjustments considered necessary for a fair statement of these reported results.

EPS and FFO per Share Guidance:

The Company’s guidance for the first quarter and full year 2020 for EPS (diluted) and FFO per share (diluted) is set forth and reconciled below.  Except as described below, the estimates reflect management’s view of current and future market conditions, including assumptions with respect to rental rates, occupancy levels and the earnings impact of the events referenced in this release and otherwise referenced during the conference call and in the Company’s Supplemental Operating and Financial Data for the quarter ended December 31, 2019. The estimates do not include possible future gains or losses or the impact on operating results from other possible future property acquisitions or dispositions, other possible capital markets activity or possible future impairment charges. EPS estimates may be subject to fluctuations as a result of several factors, including changes in the recognition of depreciation and amortization expense and any gains or losses associated with disposition activity. The Company is not able to assess at this time the potential impact of these factors on projected EPS. By definition, FFO does not include real estate-related depreciation and amortization, impairment losses on depreciable real estate or gains or losses associated with disposition activities. There can be no assurance that the Company’s actual results will not differ materially from the estimates set forth below. For details of the Company’s assumptions related to guidance for the first quarter and full year 2020 for EPS (diluted) and FFO per share (diluted), please see the Fourth Quarter 2019 Supplemental Operating and Financial Data located on the Investor Relations section of the Company’s website at investors.bxp.com.

As set forth below, the Company has updated its projected EPS (diluted) for the full year 2020 to $5.91 - $6.09 per share from $3.45 - $3.65 per share. This is an increase of approximately $2.45 per share at the midpoint of the Company’s guidance provided on October 29, 2019 primarily due to an estimated $2.37 per share in gains from sales of real estate that are expected to close in the first quarter of 2020.

In addition, the Company has updated its projected guidance range for FFO per diluted share for the full year 2020 to $7.47 - $7.65 per share from $7.45- $7.65 per share. This is an increase of approximately $0.01 per share at the midpoint of the Company’s guidance provided on October 29, 2019 primarily due to lower than projected net interest expense.

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First Quarter 2020 Full Year 2020
Low - High Low - High
Projected EPS (diluted) $ 3.22 - $ 3.24 $ 5.91 - $ 6.09
Add:
Projected Company Share of Real Estate Depreciation and Amortization 0.95 - 0.95 3.93 - 3.93
Projected Company Share of Gains on Sales of Real Estate (2.37 ) - (2.37 ) (2.37 ) - (2.37 )
Projected FFO per Share (diluted) $ 1.80 - $ 1.82 $ 7.47 - $ 7.65
% Growth in FFO as compared to 2019 6.6 % - 9.1 %

Boston Properties will host a conference call on Wednesday, January 29, 2020 at 10:00 AM Eastern Time, open to the general public, to discuss the fourth quarter and full year 2019 results, the 2020 projections and related assumptions, and other matters that may be of interest to investors. The number to call for this interactive teleconference is (877) 706-4503 (Domestic) or (281) 913-8731(International) and entering the passcode 3928659. A replay of the conference call will be available through February 12, 2020, by dialing (855) 859-2056 (Domestic) or (404) 537-3406 (International) and entering the passcode 3928659. There will also be a live audio webcast of the call, which may be accessed in the Investor Relations section of the Company’s website at investors.bxp.com. Shortly after the call, a replay of the webcast will be available in the Investor Relations section of the Company’s website and archived for up to twelve months following the call.

Additionally, a copy of Boston Properties’ fourth quarter 2019 “Supplemental Operating and Financial Data” and this press release are available in the Investor Relations section of the Company’s website at investors.bxp.com.

Boston Properties (NYSE: BXP) is the largest publicly-held developer and owner of Class A office properties in the United States, concentrated in five markets -  Boston, Los Angeles, New York, San Francisco and Washington, DC. The Company is a fully integrated real estate company, organized as a real estate investment trust (REIT), that develops, manages, operates, acquires and owns a diverse portfolio of primarily Class A office space. The Company’s portfolio totals 52.0 million square feet and 196 properties, including 11 properties under construction. For more information about Boston Properties, please visit our website at www.bxp.com or follow us on LinkedIn or Instagram.

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This press release contains forward-looking statements within the meaning of the Federal securities laws. You can identify these statements by our use of the words “assumes,” “believes,” “budgeted,” “estimates,” “expects,” “guidance,” “intends,” “plans,” “projects” and similar expressions that do not relate to historical matters. You should exercise caution in interpreting and relying on forward-looking statements because they involve known and unknown risks, uncertainties and other factors, which are, in some cases, beyond Boston Properties’ control and could materially affect actual results, performance or achievements. These factors include, without limitation, the Company’s ability to satisfy the closing conditions to the pending transactions described above, the Company’s ability to enter into new leases or renew leases on favorable terms, dependence on tenants’ financial condition, the uncertainties of real estate development, acquisition and disposition activity, the ability to effectively integrate acquisitions, the uncertainties of investing in new markets, the costs and availability of financing, the effectiveness of our interest rate hedging contracts, the ability of our joint venture partners to satisfy their obligations, the effects of local, national and international economic and market conditions, the effects of acquisitions, dispositions and possible impairment charges on our operating results, the impact of newly adopted accounting principles on the Company’s accounting policies and on period-to-period comparisons of financial results, regulatory changes and other risks and uncertainties detailed from time to time in the Company’s filings with the Securities and Exchange Commission. Boston Properties does not undertake a duty to update or revise any forward-looking statement, including its guidance for the first quarter and full fiscal year 2020, whether as a result of new information, future events or otherwise.

Financial tables follow.

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BOSTON PROPERTIES, INC.<br><br>CONSOLIDATED BALANCE SHEETS<br><br>(Unaudited)
December 31, 2019 December 31, 2018
(in thousands, except for share and par value amounts)
ASSETS
Real estate, at cost $ 21,458,412 $ 20,870,602
Construction in progress 789,736 578,796
Land held for future development 254,828 200,498
Right of use assets - finance leases 237,394 —
Right of use assets - operating leases 148,640 —
Less: accumulated depreciation (5,266,798 ) (4,897,777 )
Total real estate 17,622,212 16,752,119
Cash and cash equivalents 644,950 543,359
Cash held in escrows 46,936 95,832
Investments in securities 36,747 28,198
Tenant and other receivables, net 112,807 86,629
Related party note receivable 80,000 80,000
Note receivable 15,920 19,468
Accrued rental income, net 1,038,788 934,896
Deferred charges, net 689,213 678,724
Prepaid expenses and other assets 41,685 80,943
Investments in unconsolidated joint ventures 955,647 956,309
Total assets $ 21,284,905 $ 20,256,477
LIABILITIES AND EQUITY
Liabilities:
Mortgage notes payable, net $ 2,922,408 $ 2,964,572
Unsecured senior notes, net 8,390,459 7,544,697
Unsecured line of credit — —
Unsecured term loan, net 498,939 498,488
Lease liabilities - finance leases 224,042 —
Lease liabilities - operating leases 200,180 —
Accounts payable and accrued expenses 377,553 276,645
Dividends and distributions payable 170,713 165,114
Accrued interest payable 90,016 89,267
Other liabilities 387,994 503,726
Total liabilities 13,262,304 12,042,509
Commitments and contingencies — —
Redeemable deferred stock units 8,365 —
Equity:
Stockholders’ equity attributable to Boston Properties, Inc.:
Excess stock, $0.01 par value, 150,000,000 shares authorized, none issued or outstanding — —
Preferred stock, $0.01 par value, 50,000,000 shares authorized; 5.25% Series B cumulative redeemable preferred stock, $0.01 par value, liquidation preference $2,500 per share, 92,000 shares authorized, 80,000 shares issued and outstanding at December 31, 2019 and December 31, 2018 200,000 200,000

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BOSTON PROPERTIES, INC.<br><br>CONSOLIDATED BALANCE SHEETS<br><br>(Unaudited)
December 31, 2019 December 31, 2018
(in thousands, except for share and par value amounts)
Common stock, $0.01 par value, 250,000,000 shares authorized, 154,869,198 and 154,537,378 issued and 154,790,298 and 154,458,478 outstanding at December 31, 2019 and December 31, 2018, respectively 1,548 1,545
Additional paid-in capital 6,294,719 6,407,623
Dividends in excess of earnings (760,523 ) (675,534 )
Treasury common stock at cost, 78,900 shares at December 31, 2019 and December 31, 2018 (2,722 ) (2,722 )
Accumulated other comprehensive loss (48,335 ) (47,741 )
Total stockholders’ equity attributable to Boston Properties, Inc. 5,684,687 5,883,171
Noncontrolling interests:
Common units of the Operating Partnership 600,860 619,352
Property partnerships 1,728,689 1,711,445
Total equity 8,014,236 8,213,968
Total liabilities and equity $ 21,284,905 $ 20,256,477

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BOSTON PROPERTIES, INC.<br><br>CONSOLIDATED STATEMENTS OF OPERATIONS<br><br>(Unaudited)
Three months ended December 31, Year ended December 31,
2019 2018 2019 2018
(in thousands, except for per share amounts)
Revenue
Lease $ 706,349 $ — $ 2,758,014 $ —
Base rent — 541,902 — 2,103,723
Recoveries from tenants — 109,265 — 402,066
Parking and other 26,727 27,831 103,534 107,421
Hotel revenue 11,793 11,745 48,589 49,118
Development and management services 10,473 12,195 40,039 45,158
Direct reimbursements of payroll and related costs from management services contracts 2,159 2,219 10,386 9,590
Total revenue 757,501 705,157 2,960,562 2,717,076
Expenses
Operating
Rental 268,919 253,043 1,050,010 979,151
Hotel 8,318 8,221 34,004 33,863
General and administrative 32,797 27,683 140,777 121,722
Payroll and related costs from management services contracts 2,159 2,219 10,386 9,590
Transaction costs 569 195 1,984 1,604
Depreciation and amortization 169,897 165,439 677,764 645,649
Total expenses 482,659 456,800 1,914,925 1,791,579
Other income (expense)
Income (loss) from unconsolidated joint ventures (936 ) 5,305 46,592 2,222
Gains (losses) on sales of real estate (57 ) 59,804 709 182,356
Interest and other income 4,393 3,774 18,939 10,823
Gains (losses) from investments in securities 2,177 (3,319 ) 6,417 (1,865 )
Impairment losses — (11,812 ) (24,038 ) (11,812 )
Losses from early extinguishments of debt (1,530 ) (16,490 ) (29,540 ) (16,490 )
Interest expense (102,880 ) (100,378 ) (412,717 ) (378,168 )
Net income 176,009 185,241 651,999 712,563
Net income attributable to noncontrolling interests
Noncontrolling interests in property partnerships (16,338 ) (16,425 ) (71,120 ) (62,909 )
Noncontrolling interest—common units of the Operating Partnership (16,222 ) (17,662 ) (59,345 ) (66,807 )
Net income attributable to Boston Properties, Inc. 143,449 151,154 521,534 582,847
Preferred dividends (2,625 ) (2,625 ) (10,500 ) (10,500 )
Net income attributable to Boston Properties, Inc. common shareholders $ 140,824 $ 148,529 $ 511,034 $ 572,347
Basic earnings per common share attributable to Boston Properties, Inc. common shareholders:
Net income $ 0.91 $ 0.96 $ 3.31 $ 3.71
Weighted average number of common shares outstanding 154,667 154,467 154,582 154,427
Diluted earnings per common share attributable to Boston Properties, Inc. common shareholders:
Net income $ 0.91 $ 0.96 $ 3.30 $ 3.70
Weighted average number of common and common equivalent shares outstanding 154,992 154,773 154,883 154,682

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BOSTON PROPERTIES, INC.<br><br>FUNDS FROM OPERATIONS (1)<br><br>(Unaudited)
Three months ended December 31, Year ended December 31,
2019 2018 2019 2018
(in thousands, except for per share amounts)
Net income attributable to Boston Properties, Inc. common shareholders $ 140,824 $ 148,529 $ 511,034 $ 572,347
Add:
Preferred dividends 2,625 2,625 10,500 10,500
Noncontrolling interest - common units of the Operating Partnership 16,222 17,662 59,345 66,807
Noncontrolling interests in property partnerships 16,338 16,425 71,120 62,909
Net income 176,009 185,241 651,999 712,563
Add:
Depreciation and amortization expense 169,897 165,439 677,764 645,649
Noncontrolling interests in property partnerships’ share of depreciation and amortization (18,116 ) (19,067 ) (71,389 ) (73,880 )
Company’s share of depreciation and amortization from unconsolidated joint ventures 14,458 17,576 58,451 54,352
Corporate-related depreciation and amortization (477 ) (398 ) (1,695 ) (1,634 )
Impairment losses — 11,812 24,038 11,812
Less:
Gains on sales of real estate included within income (loss) from unconsolidated joint ventures (32 ) 8,270 47,238 8,270
Gains (losses) on sales of real estate (57 ) 59,804 709 182,356
Noncontrolling interests in property partnerships 16,338 16,425 71,120 62,909
Preferred dividends 2,625 2,625 10,500 10,500
Funds from operations (FFO) attributable to the Operating Partnership common unitholders (including Boston Properties, Inc.) 322,897 273,479 1,209,601 1,084,827
Less:
Noncontrolling interest - common units of the Operating Partnership’s share of funds from operations 32,960 27,789 123,757 110,338
Funds from operations attributable to Boston Properties, Inc. common shareholders $ 289,937 $ 245,690 $ 1,085,844 $ 974,489
Boston Properties, Inc.’s percentage share of funds from operations - basic 89.79 % 89.84 % 89.77 % 89.83 %
Weighted average shares outstanding - basic 154,667 154,467 154,582 154,427
FFO per share basic $ 1.87 $ 1.59 $ 7.02 $ 6.31
Weighted average shares outstanding - diluted 154,992 154,773 154,883 154,682
FFO per share diluted $ 1.87 $ 1.59 $ 7.01 $ 6.30

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(1) Pursuant to the revised definition of Funds from Operations adopted by the Board of Governors of the National Association of Real Estate Investment Trusts (“Nareit”), we calculate Funds from Operations, or “FFO,” by adjusting net income (loss) attributable to Boston Properties, Inc. common shareholders (computed in accordance with GAAP) for gains (or losses) from sales of properties, impairment losses on depreciable real estate consolidated on our balance sheet, impairment losses on our investments in unconsolidated joint ventures driven by a measurable decrease in the fair value of depreciable real estate held by the unconsolidated joint ventures and real estate-related depreciation and amortization. FFO is a non-GAAP financial measure, but we believe the presentation of FFO, combined with the presentation of required GAAP financial measures, has improved the understanding of operating results of REITs among the investing public and has helped make comparisons of REIT operating results more meaningful. Management generally considers FFO and FFO per share to be useful measures for understanding and comparing our operating results because, by excluding gains and losses related to sales of previously depreciated operating real estate assets, impairment losses and real estate asset depreciation and amortization (which can differ across owners of similar assets in similar condition based on historical cost accounting and useful life estimates), FFO and FFO per share can help investors compare the operating performance of a company’s real estate across reporting periods and to the operating performance of other companies.

Our computation of FFO may not be comparable to FFO reported by other REITs or real estate companies that do not define the term in accordance with the current Nareit definition or that interpret the current Nareit definition differently.

In order to facilitate a clear understanding of the Company’s operating results, FFO should be examined in conjunction with net income attributable to Boston Properties, Inc. common shareholders as presented in the Company’s consolidated financial statements. FFO should not be considered as a substitute for net income attributable to Boston Properties, Inc. common shareholders (determined in accordance with GAAP) or any other GAAP financial measures and should only be considered together with and as a supplement to the Company’s financial information prepared in accordance with GAAP.

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BOSTON PROPERTIES, INC.<br><br>PORTFOLIO LEASING PERCENTAGES
% Leased by Location
December 31, 2019 December 31, 2018
Boston 95.9 % 95.9 %
Los Angeles 96.7 % 96.7 %
New York 92.9 % 88.0 %
San Francisco 93.7 % 87.8 %
Washington, DC 87.6 % 90.7 %
Total Portfolio 93.0 % 91.4 %

AT THE COMPANY

Michael LaBelle

Executive Vice President,

Chief Financial Officer and Treasurer

(617) 236-3352

Sara Buda

Vice President, Investor Relations

(617) 236-3429

sbuda@bxp.com

#

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