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What changed in BXP, Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of BXP, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+483 added−507 removedSource: 10-K (2025-02-27) vs 10-K (2024-02-27)

Top changes in BXP, Inc.'s 2024 10-K

483 paragraphs added · 507 removed · 361 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

217 edited+71 added−90 removed63 unchanged
Biggest change(4) On October 2, 2023, a joint venture in which we owned a 20% equity interest completed a two-step restructuring of the ownership in Metropolitan Square, which resulted in, among other things, (i) the cessation of our obligation to fund future investments through our then 20% equity interest, which caused us to recognize a gain on investment of approximately $35.8 million related to our deficit investment balance that resulted from distributions, (ii) the removal of the property from our in-service portfolio, (iii) the sale of the property, which resulted in a loss on the sale of approximately $1.5 million and assignment of the existing senior loan to the new owner, and (iv) the closing of a new mezzanine loan (see Note 6 of the Consolidated Financial Statements). 101 T able of Contents The following tables presents a reconciliation of net income attributable to Boston Properties, Inc. common shareholders to Diluted FFO attributable to Boston Properties, Inc. for income (numerator) and shares/units (denominator) for the years ended December 31, 2023, 2022 and 2021: Year ended December 31, 2023 2022 2021 (in thousands) Net income attributable to Boston Properties, Inc. common shareholders $ 190,215 $ 848,947 $ 496,223 Add: Preferred stock redemption charge — — 6,412 Preferred dividends — — 2,560 Noncontrolling interest—common units of the Operating Partnership 22,548 96,780 55,931 Noncontrolling interests in property partnerships 78,661 74,857 70,806 Net income 291,424 1,020,584 631,932 Add: Depreciation and amortization 830,813 749,775 717,336 Noncontrolling interests in property partnerships’ share of depreciation and amortization (73,027) (70,208) (67,825) BXP’s share of depreciation and amortization from unconsolidated joint ventures 101,199 89,275 71,966 Corporate-related depreciation and amortization (1,810) (1,679) (1,753) Non-real estate depreciation and amortization (1,681) — — Impairment losses included within loss from unconsolidated joint ventures (1) 272,603 50,705 — Less: Gain on sale of real estate included within loss from unconsolidated joint ventures (2) — — 10,257 Gain (loss) on sale / consolidation included within loss from unconsolidated joint ventures (3) 28,412 — — Gain on investment included within loss from unconsolidated joint ventures (4) 35,756 — — Gains on sales of real estate 517 437,019 123,660 Gain on sales-type lease — 10,058 — Gain on sales-type lease included within loss from unconsolidated joint ventures 1,368 — — Unrealized gain (loss) on non-real estate investment 239 (150) — Noncontrolling interests in property partnerships 78,661 74,857 70,806 Preferred dividends — — 2,560 Preferred stock redemption charge — — 6,412 Funds from Operations (FFO) attributable to the Operating Partnership common unitholders (including Boston Properties, Inc.) 1,274,568 1,316,668 1,137,961 Effect of Dilutive Securities: Stock based compensation — — — Diluted FFO 1,274,568 1,316,668 1,137,961 Less: Noncontrolling interest—common units of the Operating Partnership’s share of diluted FFO 130,516 132,852 111,748 Diluted FFO attributable to Boston Properties, Inc.
Biggest changeThe following tables presents a reconciliation of net income attributable to BXP, Inc. to Diluted FFO attributable to BXP, Inc. for income (numerator) and shares/units (denominator) for the years ended December 31, 2024, 2023 and 2022: Year ended December 31, 2024 2023 2022 (in thousands) Net income attributable to BXP, Inc. $ 14,272 $ 190,215 $ 848,947 Add: Noncontrolling interest—common units of the Operating Partnership 2,400 22,548 96,780 Noncontrolling interests in property partnerships 67,516 78,661 74,857 Net income 84,188 291,424 1,020,584 Add: Depreciation and amortization 887,191 830,813 749,775 Noncontrolling interests in property partnerships’ share of depreciation and amortization (76,660) (73,027) (70,208) BXP’s share of depreciation and amortization from unconsolidated joint ventures 81,904 101,199 89,275 Corporate-related depreciation and amortization (1,710) (1,810) (1,679) Non-real estate depreciation and amortization 8,520 (1,681) — Impairment loss 13,615 — — Impairment losses included within loss from unconsolidated joint ventures (1) 341,338 272,603 50,705 Less: Gain on sale / consolidation included within loss from unconsolidated joint ventures (2) 21,696 28,412 — Gain on investment included within loss from unconsolidated joint ventures (3) — 35,756 — Gains on sales of real estate 602 517 437,019 Gain on sales-type lease — — 10,058 Gain on sales-type lease included within loss from unconsolidated joint ventures — 1,368 — Unrealized gain (loss) on non-real estate investment 546 239 (150) Noncontrolling interests in property partnerships 67,516 78,661 74,857 Funds from Operations (FFO) attributable to the Operating Partnership common unitholders (including BXP, Inc.) 1,248,026 1,274,568 1,316,668 Effect of Dilutive Securities: Stock based compensation — — — Diluted FFO 1,248,026 1,274,568 1,316,668 Less: Noncontrolling interest—common units of the Operating Partnership’s share of diluted FFO 127,299 130,516 132,852 Diluted FFO attributable to BXP, Inc.
REIT Tax Distribution Considerations Dividend BXP as a REIT is subject to a number of organizational and operational requirements, including a requirement that BXP currently distribute at least 90% of its annual taxable income (excluding capital gains and with certain other adjustments).
REIT Tax Distribution Considerations Dividend As a REIT, BXP is subject to a number of organizational and operational requirements, including a requirement that BXP currently distribute at least 90% of its annual taxable income (excluding capital gains and with certain other adjustments).
(6) Capital contributions to unconsolidated joint ventures for the year ended December 31, 2023 consisted primarily of cash contributions of approximately $62.6 million, $42.7 million, $18.0 million, $18.0 million, $14.9 million, $10.6 million and $10.1 million to our Gateway Commons, Platform 16, Worldgate Drive, Dock 72, 360 Park Avenue South, 751 Gateway and Safeco Plaza joint ventures, respectively.
Capital contributions to unconsolidated joint ventures for the year ended December 31, 2023 consisted primarily of cash contributions of approximately $62.6 million, $42.7 million, $18.0 million, $18.0 million, $14.9 million, $10.6 million and $10.1 million to our Gateway Commons, Platform 16, Worldgate Drive, Dock 72, 360 Park Avenue South, 751 Gateway and Safeco Plaza joint ventures, respectively.
We use NOI internally as a performance measure and believe it provides useful information to investors regarding our results of operations and financial condition because, when compared across periods, it reflects 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 attributable to Boston Properties, Inc. and net income attributable to Boston Properties Limited Partnership.
We use NOI internally as a performance measure and believe it provides useful information to investors regarding our results of operations and financial condition because, when compared across periods, it reflects 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 attributable to BXP, Inc. and net income attributable to Boston Properties Limited Partnership.
Under the credit agreement, BPLP may, at any time prior to the maturity date, increase total commitments by up to an additional $300.0 million in aggregate principal amount by increasing the existing 2023 Unsecured Term Loan or incurring one or more additional term loans, in each case, subject to syndication of the increase and other conditions.
Under the credit agreement governing the 2023 Unsecured Term Loan, BPLP may, at any time prior to the maturity date, increase total commitments by up to an additional $300.0 million in aggregate principal amount by increasing the existing 2023 Unsecured Term Loan or incurring one or more additional term loans, in each case, subject to syndication of the increase and other conditions.
(4) On December 14, 2023, we acquired our joint venture partner’s 45% interest in the joint venture entity that owns Santa Monica Business Park located in Santa Monica, California. The acquisition was completed for a gross purchase price of $38.0 million and we acquired net working capital, including cash and cash equivalents of approximately $20 million.
On December 14, 2023, we acquired our joint venture partner’s 45% interest in the joint venture entity that owns Santa Monica Business Park located in Santa Monica, California. The acquisition was completed for a gross purchase price of $38.0 million and we acquired net working capital, including cash and cash equivalents of approximately $20 million.
(2) Construction in progress for the year ended December 31, 2023 included ongoing expenditures associated with 2100 Pennsylvania Avenue, 140 Kendrick Street Building A and the View Boston observatory at The Prudential Center, which were fully placed in-service during the year ended December 31, 2023 and 180 CityPoint and 103 CityPoint that were partially placed in-service during the year ended December 31, 2023.
Construction in progress for the year ended December 31, 2023 included ongoing expenditures associated with 2100 Pennsylvania Avenue, 140 Kendrick Street Building A and the View Boston observatory at The Prudential Center, which were fully placed in-service during the year ended December 31, 2023 and 180 CityPoint and 103 CityPoint that were partially placed in-service during the year ended December 31, 2023.
This enables us to generally match our liabilities to BXP’s officers or former non-employee directors under our deferred compensation plans with equivalent assets and thereby limit our market risk. The performance of these investments is recorded as gains (losses) from investments in securities.
This enables us to generally match our liabilities to BXP’s officers or former non-employee directors under our deferred compensation plans with equivalent assets and thereby limit our market risk. The performance of these investments is recorded as gains from investments in securities.
(12) The indebtedness consists of (x) a $70.0 million mortgage loan payable (Note A) which bears interest at a fixed rate of 6.23% per annum, and (y) a $35.0 million mortgage loan payable (Note B) which bears interest at a fixed rate of 8.03% per annum. We provided $10.5 million of the Note B mortgage financing to the joint venture.
(10) The indebtedness consists of (x) a $70.0 million mortgage loan payable (Note A) which bears interest at a fixed rate of 6.23% per annum, and (y) a $35.0 million mortgage loan payable (Note B) which bears interest at a fixed rate of 8.03% per annum. We provided $10.5 million of the Note B mortgage financing to the joint venture.
NOI should not be considered as a substitute for net income attributable to Boston Properties, Inc. or net income attributable to Boston Properties Limited Partnership (determined in accordance with GAAP) or any other GAAP financial measures and should only be considered together with and as a supplement to our financial information prepared in accordance with GAAP.
NOI should not be considered as a substitute for net income attributable to BXP, Inc. or net income attributable to Boston Properties Limited Partnership (determined in accordance with GAAP) or any other GAAP financial measures and should only be considered together with and as a supplement to our financial information prepared in accordance with GAAP.
For a discussion concerning our unconsolidated joint venture debt, see Note 6 to the Consolidated Financial Statements and “ Item 7 — Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources—Investment in Unconsolidated Joint Ventures - Secured Debt. ” Funds from Operations 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,” for each of BXP and BPLP by adjusting net income attributable to Boston Properties, Inc. common shareholders and net income attributable to Boston Properties Limited Partnership common unitholders (computed in accordance with GAAP), respectively, for gains (or losses) from sales of properties, including a change in control, 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 our share of real estate-related depreciation and amortization.
For a discussion concerning our unconsolidated joint venture debt, see Note 6 to the Consolidated Financial Statements and “ Item 7 — Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources—Investment in Unconsolidated Joint Ventures - Secured Debt. ” Funds from Operations 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,” for each of BXP and BPLP by adjusting net income attributable to BXP, Inc. and net income attributable to Boston Properties Limited Partnership (computed in accordance with GAAP), respectively, for gains (or losses) from sales of properties, including a change in control, 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 our share of real estate-related depreciation and amortization.
We believe that in order to understand our operating results, NOI should be examined in conjunction with net income attributable to Boston Properties, Inc. and net income attributable to Boston Properties Limited Partnership as presented in our Consolidated Financial Statements.
We believe that in order to understand our operating results, NOI should be examined in conjunction with net income attributable to BXP, Inc. and net income attributable to Boston Properties Limited Partnership as presented in our Consolidated Financial Statements.
Management generally considers FFO to be useful measures for understanding and comparing our operating results because, by excluding gains and losses related to sales or a change in control 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 can help investors compare the operating performance of a company’s real estate across reporting periods and to the operating performance of other companies.
Management generally considers FFO to be a useful measure for understanding and comparing our operating results because, by excluding gains and losses related to sales or a change in control 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 can help investors compare the operating performance of a company’s real estate across reporting periods and to the operating performance of other companies.
(3) On December 14, 2023, we acquired our joint venture partner’s 45% ownership interest in Santa Monica Business Park located in Santa Monica, California for a purchase price of $38.0 million.
On December 14, 2023, we acquired our joint venture partner’s 45% ownership interest in Santa Monica Business Park located in Santa Monica, California for a purchase price of $38.0 million.
Discussions of 2021 items and year-to-year comparisons between 2022 and 2021 that are not included in this Form 10-K can be found in “ Management’s Discussion and Analysis of Financial Condition and Results of Operation s” in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2022, which was filed with the SEC on February 27, 2023.
Discussions of 2022 items and year-to-year comparisons between 2023 and 2022 that are not included in this Form 10-K can be found in “ Management’s Discussion and Analysis of Financial Condition and Results of Operation s” in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2023, which was filed with the SEC on February 27, 2024.
For details about our other contractual payment obligations related to operating and finance leases and debt, see Notes 4, 7 and 17 to the Consolidated Financial Statements, respectively.
For details about our other contractual payment obligations related to operating and finance leases and debt, see Notes 4 and 7 to the Consolidated Financial Statements, respectively.
Generally, our properties generate a relatively consistent stream of cash flow that provides us with resources to pay operating expenses, debt service and fund regular quarterly dividend and distribution payment requirements. In addition, over the past several years, we have raised capital through the sale of some of our properties and through secured and unsecured borrowings.
Generally, our properties generate a relatively consistent stream of cash flows that provides us with resources to pay operating expenses, debt service and fund regular quarterly dividend and distribution payment requirements. In addition, over the past several years, we have raised capital through the sale of some of our properties and through secured and unsecured borrowings.
Our policy is for BXP to distribute at least 100% of its taxable income, including capital gains, to avoid paying federal tax. Common and LTIP unitholders (other than unearned MYLTIP units) of limited partnership interest in BPLP receive the same distribution per unit that is paid per share of BXP common stock.
Our policy is for BXP to distribute at least 100% of its taxable income, including capital gains, to avoid paying federal tax. Holders of common and LTIP units (other than unearned MYLTIP units) of limited partnership interest in BPLP receive the same distribution per unit that is paid per share of BXP common stock.
The New Mezz Loan may be drawn upon for future lease-up, operating and other costs on an as needed basis, and amounts borrowed will bear interest at a per annum rate of 12%, compounded monthly. We will fund 20%, or up to $20.0 million, of any amounts borrowed under the New Mezz Loan.
The new mezzanine loan may be drawn upon for future lease-up, operating and other costs on an as needed basis, and amounts borrowed will bear interest at a per annum rate of 12%, compounded monthly. We will fund 20%, or up to $20.0 million, of any amounts borrowed under the new mezzanine loan.
We earn a fee from the joint venture for providing the guarantee and have an agreement with our partners to reimburse the joint venture for their share of any payments made under the guarantee (See Note 9 to the Consolidated Financial Statements). (7) This property is owned by a consolidated entity in which we have a 55% interest.
We earn a fee from the joint venture for providing the guarantee and have an agreement with our partners to reimburse the joint venture for their share of any payments made under the guarantee (See Note 9 to the Consolidated Financial Statements). (8) This property is owned by a consolidated entity in which we have a 55% interest.
Therefore, the comparison of operating results for the year ended December 31, 2023 and 2022 show separately the changes attributable to the properties that were owned by us and in-service throughout each period compared (the “Same Property Portfolio”) and the changes attributable to the properties included in the Acquired, Placed In-Service, In or Held for Development or Redevelopment or Sold Portfolios.
Therefore, the comparison of operating results for the year ended December 31, 2024 and 2023 show separately the changes attributable to the properties that were owned by us and in-service throughout each period compared (the “Same Property Portfolio”) and the changes attributable to the properties included in the Acquired, Placed In-Service, In or Held for Development or Redevelopment or Sold Portfolios.
(2) Each of Investment to Date, Estimated Total Investment and Estimated Future Equity Requirement represent our share of acquisition expenses, as applicable, and reflect our share of the estimated net revenue/expenses that we expect to incur prior to stabilization of the project, including any amounts actually received or paid through December 31, 2023.
(2) Each of Investment to Date, Estimated Total Investment and Estimated Future Equity Requirement represent our share of acquisition expenses, as applicable, and reflect our share of the estimated net revenue/expenses that we expect to incur prior to stabilization of the project, including any amounts actually received or paid through December 31, 2024.
We expect to satisfy these needs using one or more of the following: • cash flow from operations; • distribution of cash flows from joint ventures; • cash and cash equivalent balances; • borrowings under BPLP’s Revolving Facility, unsecured term loans, short-term bridge facilities and construction loans; • long-term secured and unsecured indebtedness (including unsecured exchangeable indebtedness); • sales of real estate and interests in joint ventures owning real estate; • private equity sources, including institutional investors; and • issuances of BXP equity securities and/or preferred or common units of partnership interests in BPLP.
We expect to satisfy these needs using one or more of the following: • cash flow from operations; • distribution of cash flows from joint ventures; • cash and cash equivalent balances; • borrowings under BPLP’s 2021 Credit Facility, unsecured term loans, short-term bridge facilities and construction loans; • long-term secured and unsecured indebtedness (including unsecured exchangeable indebtedness); • sales of real estate and interests in joint ventures owning real estate; • private equity sources, including institutional investors; and • issuances of BXP equity securities and/or preferred or common units of partnership interests in BPLP.
(2) Committed client-related obligations (tenant improvements and lease commissions) based on executed leases as of December 31, 2023. The timing and amount of these payments is subject to change. We have various service contracts with vendors related to our property management.
(2) Committed client-related obligations (tenant improvements and lease commissions) based on executed leases as of December 31, 2024. The timing and amount of these payments is subject to change. We have various service contracts with vendors related to our property management.
Item 1. Business—Transactions During 2023 .” Critical Accounting Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America, or GAAP, requires management to use judgment in the application of accounting policies, including making estimates and assumptions.
Item 1. Business—Transactions During 2024 .” Critical Accounting Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America, or GAAP, requires management to use judgment in the application of accounting policies, including making estimates and assumptions.
The joint venture entered into an interest rate cap agreement with a financial institution to limit its exposure to increases in the SOFR rate at a cap of 2.50% per annum on a notional amount of $250.0 million through September 1, 2024.
The joint venture entered into an interest rate cap agreement with a financial institution to limit its exposure to increases in the SOFR rate at a cap of 2.50% per annum on a notional amount of $250.0 million through September 1, 2025.
The Total Property Portfolio includes the effects of the other properties either acquired, placed in-service, in or held for development or redevelopment after January 1, 2022 or disposed of on or prior to December 31, 2023.
The Total Property Portfolio includes the effects of the other properties either acquired, placed in-service, in or held for development or redevelopment after January 1, 2023 or disposed of on or prior to December 31, 2024.
At the time of the pay off, the outstanding balance of the loan totaled approximately $105.0 million and was scheduled to mature on June 6, 2023. The new mortgage loans have an aggregate principal balance of $105.0 million, bear interest at a weighted average fixed rate of 6.83% per annum and mature on June 5, 2026.
At the time of the payoff, the outstanding balance of the loan totaled approximately $105.0 million and was scheduled to mature on June 6, 2023. The new mortgage loans have an aggregate principal balance of $105.0 million, bear interest at a weighted average fixed rate of 6.83% per annum and mature on June 5, 2026.
If market interest rates on our variable rate debt had been 100 basis points greater, total interest expense would have increased approximately $21.0 million, on an annualized basis for the year ended December 31, 2023. The information above does not include our unconsolidated joint venture debt.
For example, if market interest rates on our variable rate debt had been 100 basis points greater, total interest expense would have increased approximately $21.0 million, on an annualized basis, for the year ended December 31, 2024. The information above does not include our unconsolidated joint venture debt.
BXP The net difference between the tax basis and the reported amounts of BXP’s assets and liabilities was approximately $2.0 billion and $2.1 billion as of December 31, 2023 and 2022, respectively, which was primarily related to the difference in basis of contributed property and accrued rental income.
BXP The net difference between the tax basis and the reported amounts of BXP’s assets and liabilities was approximately $1.6 billion and $2.0 billion as of December 31, 2024 and 2023, respectively, which was primarily related to the difference in basis of contributed property and accrued rental income.
At December 31, 2023, the aggregate carrying amount of debt, including both our and our partners’ share, incurred by these ventures was approximately $3.4 billion (of which our proportionate share is approximately $1.4 billion). The table below summarizes the outstanding debt of these joint venture properties at December 31, 2023.
At December 31, 2024, the aggregate carrying amount of debt, including both our and our partners’ share, incurred by these ventures was approximately $3.2 billion (of which our proportionate share is approximately $1.4 billion). The table below summarizes the outstanding debt of these joint venture properties at December 31, 2024.
As a result, during the year ended December 31, 2023, we recorded approximately $0.6 million of accelerated depreciation expense for the demolition of the garage.
As a result, during the year ended December 31, 2023, BPLP recorded approximately $0.6 million of accelerated depreciation expense for the demolition of the garage.
(11) The loan bears interest at a variable rate equal to the greater of (x) 2.35% or (y) SOFR plus 2.32% per annum.
(9) The loan bears interest at a variable rate equal to the greater of (x) 2.35% or (y) SOFR plus 2.32% per annum.
Consolidated market capitalization is the sum of: (1) our consolidated debt; plus (2) the product of (x) the closing price per share of BXP common stock on December 29, 2023, as reported by the New York Stock Exchange, multiplied by (y) the sum of: (i) the number of outstanding shares of common stock of BXP, (ii) the number of outstanding OP Units in BPLP (excluding OP Units held by BXP), (iii) the number of OP Units issuable upon conversion of all outstanding LTIP Units, assuming all conditions have been met for the conversion of the LTIP Units, and (iv) the number of OP Units issuable upon conversion of 2012 OPP Units, and 2013 - 2020 MYLTIP Units that were issued in the form of LTIP Units.
Consolidated market capitalization is the sum of: (1) our consolidated debt; plus (2) the product of (x) the closing price per share of BXP common stock on December 31, 2024, as reported by the New York Stock Exchange, multiplied by (y) the sum of: (i) the number of outstanding shares of common stock of BXP, (ii) the number of outstanding OP Units in BPLP (excluding OP Units held by BXP), (iii) the number of OP Units issuable upon conversion of all outstanding LTIP Units, assuming all conditions have been met for the conversion of the LTIP Units, and (iv) the number of OP Units issuable upon conversion of 2012 OPP Units, and 2013 - 2021 MYLTIP Units that were issued in the form of LTIP Units.
If market interest rates on our variable rate debt had been 100 basis points greater, total interest expense would have increased approximately $21.0 million, on an annualized basis for the year ended December 31, 2023, respectively.
If market interest rates on our variable rate debt had been 100 basis points greater, total interest expense would have increased approximately $21.0 million, on an annualized basis, for the year ended December 31, 2024.
(4) The mortgage loan bears interest at a variable rate of Daily Compounded SOFR plus 2.25% per annum.
(5) The mortgage loan bears interest at a variable rate of Daily Compounded SOFR plus 2.25% per annum.
(4) On October 2, 2023, a joint venture in which we owned a 20% equity interest completed a two-step restructuring of the ownership in Metropolitan Square, which resulted in, among other things, (i) the cessation of our obligation to fund future investments through our then 20% equity interest, which caused us to recognize a gain on investment of approximately $35.8 million related to our deficit investment balance that resulted from distributions, (ii) the removal of the property from our in-service portfolio, (iii) the sale of the property, which resulted in a loss on the sale of approximately $1.5 million and assignment of the existing senior loan to the new owner, and (iv) the closing of a new mezzanine loan (see Note 6 of the Consolidated Financial Statements).
(3) On October 2, 2023, a joint venture in which we owned a 20% equity interest completed a two-step restructuring of the ownership in Metropolitan Square, which resulted in, among other things, (i) the cessation of our obligation to fund future investments through our then 20% equity interest, which caused us to recognize a gain on investment of approximately $35.8 million related to our deficit investment balance that resulted from distributions, (ii) the removal of the property from our in-service portfolio, (iii) the sale of the property, which resulted in a loss on the sale of approximately $1.5 million and assignment of the existing senior loan to the new owner, and (iv) the closing of a new mezzanine loan.
The fair value is calculated using discounted cash flows which is subjective and considers assumptions regarding future occupancy, future rental rates, future capital requirements, debt interest rates and availability, discount rates and capitalization rates that could differ materially from actual results in future periods.
The fair value is calculated using discounted cash flows which is subjective and considers assumptions regarding 60 Table of Contents future occupancy, future rental rates, future capital requirements, debt interest rates and availability, discount rates and capitalization rates that could differ materially from actual results in future periods.
We believe that in order to facilitate a clear understanding of our operating results, FFO should be examined in conjunction with net income attributable to Boston Properties, Inc. common shareholders and net income attributable to Boston Properties Limited Partnership common unitholders as presented in our Consolidated Financial Statements.
We believe that in order to facilitate a clear understanding of our operating results, FFO should be examined in conjunction with net income attributable to BXP, Inc. and net income attributable to Boston Properties Limited Partnership as presented in our Consolidated Financial Statements.
The weighted-average term of our in-place leases, including leases signed by our unconsolidated joint ventures, excluding residential units, was approximately 7.8 years as of December 31, 2023, with occupancy rates historically in the range of 88% to 92%.
The weighted-average term of our in-place leases, including leases signed by our unconsolidated joint ventures, excluding residential units, was approximately 7.8 years as of December 31, 2024, with occupancy rates historically in the range of 87% to 92%.
The Same Property Portfolio therefore excludes properties acquired, placed in-service or in or held for development or redevelopment after the beginning of the earliest period presented or disposed of prior to the end of the latest period presented. 70 T able of Contents NOI is a non-GAAP financial measure equal to net income attributable to Boston Properties, Inc. and net income attributable to Boston Properties Limited Partnership, as applicable, the most directly comparable GAAP financial measures, plus (1) net income attributable to noncontrolling interests, interest expense, losses from interest rate contracts, loss from unconsolidated joint ventures, depreciation and amortization expense, transaction costs, payroll and related costs from management services contracts and corporate general and administrative expense less (2) unrealized gain (loss) on non-real estate investment, gains (losses) from investments in securities, other income - assignment fee, interest and other income (loss), gain on sales-type lease, gains on sales of real estate, direct reimbursements of payroll and related costs from management services contracts and development and management services revenue.
The Same Property Portfolio therefore excludes properties acquired, placed in-service or in or held for development or redevelopment after the beginning of the earliest period presented or disposed of prior to the end of the latest period presented. 64 Table of Contents NOI is a non-GAAP financial measure equal to net income attributable to BXP, Inc. and net income attributable to Boston Properties Limited Partnership, as applicable, the most directly comparable GAAP financial measures, plus (1) net income attributable to noncontrolling interests, interest expense, impairment loss, losses from interest rate contracts, loss from unconsolidated joint ventures, depreciation and amortization expense, transaction costs, payroll and related costs from management services contracts and corporate general and administrative expense less (2) unrealized gain on non-real estate investments, gains from investments in securities, interest and other income (loss), gains on sales of real estate, direct reimbursements of payroll and related costs from management services contracts and development and management services revenue.
In order to 79 T able of Contents reduce our market risk relating to these plans, we typically acquire, in a separate account that is not restricted as to its use, similar or identical investments as those selected by each officer or non-employee director.
In order to reduce our market risk relating to these plans, we typically acquire, in a separate account that is not restricted as to its use, similar or identical investments as those selected by each officer or non-employee director.
Our liquidity and capital resources depend on a wide range of factors, and we believe that our access to capital and our strong liquidity, including the approximately $1.8 billion available under BPLP’s Revolving Facility and our available cash, as of February 20, 2024, are sufficient to fund our remaining capital needs on existing development and redevelopment projects, fund acquisitions, repay our maturing indebtedness when due (if not refinanced or extended), satisfy our REIT distribution requirements and still allow us to act opportunistically on attractive investment opportunities.
Our liquidity and capital resources depend on a wide range of factors, and we believe that our access to capital and our strong liquidity, including the approximately $1.2 billion available under BPLP’s 2021 Credit Facility and our available cash, as of February 21, 2025, are sufficient to fund our remaining capital needs on existing development and redevelopment projects, fund acquisitions, repay our maturing indebtedness when due (if not refinanced or extended), satisfy our REIT distribution requirements and still allow us to act opportunistically on attractive investment opportunities.
(6) In connection with the refinancing of the loan, we guaranteed the consolidated entity’s obligation to fund various reserves for tenant improvement costs and allowances, leasing commissions and free rent obligations in lieu of cash deposits. As of December 31, 2023, the maximum funding obligation under the guarantee was approximately $8.5 million.
(7) In connection with the refinancing of the loan, we guaranteed the consolidated entity’s obligation to fund various reserves for tenant improvement costs and allowances, leasing commissions and free rent obligations in lieu of cash deposits. As of December 31, 2024, the maximum funding obligation under the guarantee was approximately $6.4 million.
Increases in interest rates can also result in increased interest expense when our fixed rate debt matures and needs to be refinanced. As of December 31, 2023, approximately $13.8 billion of our indebtedness bore interest at fixed rates and therefore the fair value of these instruments is not affected by changes in the market interest rates.
Increases in interest rates can also result in increased interest expense when our fixed rate debt matures and needs to be refinanced. As of December 31, 2024, approximately $14.1 billion of our indebtedness bore interest at fixed rates and therefore the fair value of these instruments is not affected by changes in the market interest rates.
Gains (Losses) from Investments in Securities Gains (losses) from investments in securities for the year ended December 31, 2023 and 2022 related to investments that we have made to reduce our market risk relating to deferred compensation plans that we maintain for BXP’s officers and former non-employee directors.
Gains from Investments in Securities Gains from investments in securities for the years ended December 31, 2024 and 2023 related to investments that we have made to reduce our market risk relating to deferred compensation plans that we maintain for BXP’s officers and former non-employee directors.
(4) On October 2, 2023, a joint venture in which we owned a 20% equity interest completed a two-step restructuring of the ownership in Metropolitan Square, which resulted in, among other things, (i) the cessation of our obligation to fund future investments through our then 20% equity interest, which caused us to recognize a gain on investment of approximately $35.8 million related to our deficit investment balance that resulted from distributions, (ii) the removal of the property from our in-service portfolio, (iii) the sale of the property, which resulted in a loss on the sale of approximately $1.5 million and assignment of the existing senior loan to the new owner, and (iv) the closing of a new mezzanine loan (see Note 6 of the Consolidated Financial Statements).
(3) On October 2, 2023, a joint venture in which we owned a 20% equity interest completed a two-step restructuring of the ownership in Metropolitan Square, which resulted in, among other things, (i) the cessation of our obligation to fund future 95 Table of Contents investments through our then 20% equity interest, which caused us to recognize a gain on investment of approximately $35.8 million related to our deficit investment balance that resulted from distributions, (ii) the removal of the property from our in-service portfolio, (iii) the sale of the property, which resulted in a loss on the sale of approximately $1.5 million and assignment of the existing senior loan to the new owner, and (iv) the closing of a new mezzanine loan.
The repayment price was approximately $713.3 million, which was equal to the stated principal plus approximately $13.3 million of accrued and unpaid interest to, but not including, the repayment date. Excluding the accrued and unpaid interest, the repayment price was equal to the principal amount being repaid.
The repayment price was approximately $863.6 million, which was equal to the stated principal plus approximately $13.6 million of accrued and unpaid interest to, but not including, the repayment date. Excluding the accrued and unpaid interest, the repayment price was equal to the principal amount being repaid.
Our primary objectives when undertaking hedging transactions and derivative positions is to reduce our floating rate exposure and to fix a portion of the interest rate for anticipated financing and refinancing transactions. This in turn, reduces the risks that the variability of cash flows imposes on variable rate debt.
Our primary objectives when undertaking hedging transactions and derivative positions is to reduce our floating rate exposure and to fix a portion of the interest rate for anticipated financing and refinancing transactions. This in turn, reduces the risks that the variability of cash flows imposes on variable rate debt. Our strategy mitigates against future increases in our interest rates.
By comparison, our general and administrative expense increased (decreased) by approximately $5.6 million and $(6.5) million during the year ended December 31, 2023 and 2022, respectively, as a result of increases (decreases) in our liability under our deferred compensation plans that was associated with the performance of the specific investments selected by officers and former non-employee directors of BXP participating in the plans.
By comparison, our general and administrative expense decreased by approximately $4.4 million and $5.6 million during the years ended December 31, 2024 and 2023, respectively, as a result of decreases in our liability under our deferred compensation plans that was associated with the performance of the specific investments selected by officers and former non-employee directors of BXP participating in the plans.
Interest capitalized for the years ended December 31, 2023 and 2022 was approximately $42.6 million and $52.1 million, respectively. These costs are not included in the interest expense referenced above. The decrease in capitalized interest is primarily attributable to a development project that had a finance lease and is now placed in service.
Interest capitalized for the year ended December 31, 2024 and 2023 was approximately $42.0 million and $42.6 million, respectively. These costs are not included in the interest expense referenced above. The decrease in capitalized interest is primarily attributable to a development project that had a finance lease and is now placed in service.
As of December 31, 2023, all of our outstanding debt, excluding our unconsolidated joint ventures and after taking into account hedging agreements, has fixed interest rates, which minimizes the interest rate risk through the maturity of such outstanding debt. We also manage our market risk by entering into hedging arrangements with financial institutions.
As of December 31, 2024, approximately 92.61% of our outstanding debt, excluding our unconsolidated joint ventures and after taking into account hedging agreements, has fixed interest rates, which minimizes the interest rate risk through the maturity of the hedging agreements. We also manage our market risk by entering into hedging arrangements with financial institutions.
For a summary of our consolidated debt as of December 31, 2023 refer to the heading “ Liquidity and Capital Resources—Debt Financing” within “ Item 7—Management’s Discussion and Analysis of Financial Condition and Results of Operations. ” Noncontrolling Interests in Property Partnerships Noncontrolling interests in property partnerships increased by approximately $3.8 million for the year ended December 31, 2023 compared to 2022, as detailed below.
For a summary of our consolidated debt as of December 31, 2024 refer to the heading “ Liquidity and Capital Resources—Debt Financing” within “ Item 7—Management’s Discussion and Analysis of Financial Condition and Results of Operations. ” Noncontrolling Interests in Property Partnerships Noncontrolling interests in property partnerships decreased by approximately $11.1 million for the year ended December 31, 2024 compared to 2023, as detailed below.
Year ended December 31, 2023 2022 2021 shares/units (in thousands) Basic Funds from Operations 174,796 174,360 173,150 Effect of Dilutive Securities: Stock based compensation 338 411 260 Diluted Funds from Operations 175,134 174,771 173,410 Material Cash Commitments As of December 31, 2023, we were subject to contractual payment obligations, excluding our unconsolidated joint ventures commitments.
Year ended December 31, 2024 2023 2022 shares/units (in thousands) Basic Funds from Operations 175,390 174,796 174,360 Effect of Dilutive Securities: Stock based compensation 325 338 411 Diluted Funds from Operations 175,715 175,134 174,771 Material Cash Commitments As of December 31, 2024, we were subject to contractual payment obligations, excluding our unconsolidated joint ventures commitments.
Unless we have entered into interest rate swaps or other derivatives to fix the interest rate, increases in interest rates can result in increased interest expense under our Revolving Facility, 2023 Unsecured Term Loan, certain mortgage loans and other debt that bears interest at variable rates.
Unless we have entered into interest rate swaps or other derivatives to fix the interest rate, increases in interest rates can result in increased interest expense under our 2021 Credit Facility, unsecured term loans, unsecured commercial paper, certain mortgage loans and other debt that bears interest at variable rates.
As of December 31, 2023, the net carrying amounts of our investments in unconsolidated joint ventures was approximately $1.3 billion, which includes investments with deficit balances aggregating approximately $39.9 million included within Other Liabilities in our Consolidated Balance Sheets.
As of December 31, 2024, the net carrying amounts of our investments in unconsolidated joint ventures was approximately $1.1 billion, which includes investments with deficit balances aggregating approximately $33.5 million included within Other Liabilities in our Consolidated Balance Sheets.
Net income attributable to Boston Properties, Inc. and net income attributable to Boston Properties Limited Partnership decreased by approximately $658.7 million and $737.5 million, respectively, for the year ended December 31, 2023 compared to 2022, as set forth in the following tables and for the reasons discussed below under the heading “ Comparison of the year ended December 31, 2023 to the year ended December 31, 2022” within “ Item 7—Management’s Discussion and Analysis of Financial Condition and Results of Operations .” The following are reconciliations of Net Income Attributable to Boston Properties, Inc. to Net Operating Income and Net Income Attributable to Boston Properties Limited Partnership to Net Operating Income for the years ended December 31, 2023 and 2022.
Net income attributable to BXP, Inc. and net income attributable to Boston Properties Limited Partnership decreased by approximately $175.9 million and $196.3 million, respectively, for the year ended December 31, 2024 compared to 2023, as set forth in the following tables and for the reasons discussed below under the heading “ Comparison of the year ended December 31, 2024 to the year ended December 31, 2023” within “ Item 7—Management’s Discussion and Analysis of Financial Condition and Results of Operations .” The following are reconciliations of Net Income Attributable to BXP, Inc. to Net Operating Income and Net Income Attributable to Boston Properties Limited Partnership to Net Operating Income for the years ended December 31, 2024 and 2023.
Rental revenue and real estate operating expenses from our Properties in or Held for Development or Redevelopment Portfolio decreased by approximately $14.6 million and $2.6 million, respectively, for the year ended December 31, 2023 compared to 2022, as detailed below.
Rental revenue from our Properties in or Held for Development or Redevelopment Portfolio increased by approximately $2.2 million and real estate operating expenses decreased by approximately $3.4 million for the year ended December 31, 2024 compared to 2023, as detailed below.
We draw on multiple financing sources to fund our long-term capital needs. We expect to fund our current development/redevelopment properties primarily with our available cash balances, funding from institutional private equity partners, construction loans, unsecured term loans, proceeds from asset sales and BPLP’s Revolving Facility.
We draw on multiple financing sources to fund our long-term capital needs. We expect to fund our current development/redevelopment projects primarily with our available cash balances, funding from institutional private equity partners, construction loans, unsecured term loans, proceeds from possible asset sales, BPLP’s 2021 Credit Facility and BPLP's commercial paper program.
The following reflects our occupancy and rate information for our residential same properties for the years ended December 31, 2023 and 2022.
The following reflects our occupancy and rate information for our residential same properties for the year ended December 31, 2024 and 2023.
We entered into interest rate swap contracts that effectively fixed the variability of these loans for all or a portion of the applicable debt term and as such, they are reflected in our Fixed rate statistics (see Notes 7 and 8 to the Consolidated Financial Statements).
We entered into interest rate swap contracts that effectively fixed the variability of these loans for all or a portion of the applicable debt term and as such, they are reflected in our Fixed rate statistics.
(3) On December 14, 2023, we acquired our joint venture partner’s 45% ownership interest in Santa Monica Business Park located in Santa Monica, California for a purchase price of $38.0 million. We recognized a gain of approximately $29.9 million on the consolidation of Santa Monica Business Park (See Notes 3 and 6 to the Consolidated Financial Statements).
On December 14, 2023, we acquired our joint venture partner’s 45% ownership interest in Santa Monica Business Park located in Santa Monica, California for a purchase price of $38.0 million. We recognized a gain of approximately $29.9 million on the consolidation of Santa Monica Business Park.
(3) On December 14, 2023, we acquired our joint venture partner’s 45% ownership interest in Santa Monica Business Park located in Santa Monica, California for a purchase price of $38.0 million. We recognized a gain of approximately $29.9 million on the consolidation of Santa Monica Business Park (See Notes 3 and 6 to the Consolidated Financial Statements).
On December 14, 2023, we acquired our joint venture partner’s 45% ownership interest in Santa Monica Business Park located in Santa Monica, California for a purchase price of $38.0 million. We recognized a gain of approximately $29.9 million on the consolidation of Santa Monica Business Park.
Wages directly related to the development of rental properties are capitalized and included in real estate assets on our Consolidated Balance Sheets and amortized over the useful lives of the applicable asset or lease 76 T able of Contents term. Capitalized wages for each of the years ended December 31, 2023 and 2022 were approximately $16.1 million.
Wages directly related to the development of rental properties are capitalized and included in real estate assets on our Consolidated Balance Sheets and amortized over the useful lives of the applicable asset or lease term. Capitalized wages for each of the year ended December 31, 2024 and 2023 were approximately $17.2 million and $16.1 million, respectively.
(4) On October 2, 2023, a joint venture in which we owned a 20% equity interest completed a two-step restructuring of the ownership in Metropolitan Square, which resulted in, among other things, (i) the cessation of our obligation to fund future investments through our then 20% equity interest, which caused us to recognize a gain on investment of approximately $35.8 million related to our deficit investment balance that resulted from distributions, (ii) the removal of the property from our in-service portfolio, (iii) the sale of the property, which resulted in a loss on the sale of approximately $1.5 million and assignment of the existing senior loan to the new owner, and (iv) the closing of a new mezzanine loan (see Note 6 of the Consolidated Financial Statements).
We recognized a gain of approximately $29.9 million on the consolidation of Santa Monica Business Park. 91 Table of Contents (3) On October 2, 2023, a joint venture in which we owned a 20% equity interest completed a two-step restructuring of the ownership in Metropolitan Square, which resulted in, among other things, (i) the cessation of our obligation to fund future investments through our then 20% equity interest, which caused us to recognize a gain on investment of approximately $35.8 million related to our deficit investment balance that resulted from distributions, (ii) the removal of the property from our in-service portfolio, (iii) the sale of the property, which resulted in a loss on the sale of approximately $1.5 million and assignment of the existing senior loan to the new owner, and (iv) the closing of a new mezzanine loan.
These costs are not included in the general and administrative expenses discussed above. Transaction Costs Transaction costs increased by approximately $1.4 million for the year ended December 31, 2023 compared to 2022. In general, transaction costs relating to the formation of new joint ventures and the pursuit of other transactions are expensed as incurred.
These costs are not included in the general and administrative expenses discussed above. Transaction Costs Transaction costs decreased by approximately $2.7 million for the year ended December 31, 2024 compared to 2023. In general, transaction costs relate to the formation of new joint ventures and the pursuit of other transactions are expensed as incurred.
As of December 31, 2023, we had funded approximately $1.7 million. On June 5, 2023, a joint venture in which we own a 30% interest repaid the existing construction loan collateralized by its 500 North Capitol Street, NW property and obtained new mortgage loans with related 89 T able of Contents parties.
For the years ended December 31, 2024 and 2023, we had funded approximately $3.3 million and $1.7 million, respectively. On June 5, 2023, a joint venture in which we own a 30% interest repaid the existing construction loan collateralized by its 500 North Capitol Street, NW property and obtained new mortgage loans with related parties.
BXP Depreciation and amortization expense increased by approximately $81.0 million for the year ended December 31, 2023 compared to 2022, as detailed below.
BXP Depreciation and amortization expense increased by approximately $56.4 million for the year ended December 31, 2024 compared to 2023, as detailed below.
(8) On October 2, 2023, a joint venture in which we owned a 20% interest completed the restructuring of Metropolitan Square (See Note 6 to the Consolidated Financial Statements) which included among other items, the closing of a new mezzanine loan with a maximum principal amount of $100.0 million (“New Mezz Loan”).
(6) On October 2, 2023, a joint venture in which we owned a 20% interest completed the restructuring of Metropolitan Square which included among other items, the closing of a new mezzanine loan with a maximum principal amount of $100.0 million.
During the year ended December 31, 2023, we paid approximately $388.6 million to fund client-related obligations, including tenant improvements and leasing commissions.
During the year ended December 31, 2024, we paid approximately $377.3 million to fund client-related obligations, including tenant improvements and leasing commissions.
Hotel Net Operating Income The Boston Marriott Cambridge hotel had net operating income of approximately $15.1 million for the year ended December 31, 2023, representing an increase of approximately $3.1 million compared to the year ended December 31, 2022.
Hotel Net Operating Income The Boston Marriott Cambridge hotel had net operating income of approximately $15.9 million for the year ended December 31, 2024, representing an increase of approximately $0.8 million compared to the year ended December 31, 2023.
Based on our acquisitions to date, our allocation to customer relationship intangible assets has been immaterial. 65 T able of Contents We record acquired “above-” and “below-market” leases at their fair values (using a discount rate which reflects the risks associated with the leases acquired) equal to the difference between (1) the contractual amounts to be paid pursuant to each in-place lease and (2) management’s estimate of fair market lease rates for each corresponding in-place lease, measured over a period equal to the remaining term of the lease for above-market leases and the initial term plus the term of any below-market fixed rate renewal options for below-market leases.
We record acquired “above-” and “below-market” leases at their fair values (using a discount rate which reflects the risks associated with the leases acquired) equal to the difference between (1) the contractual amounts to be paid pursuant to each in-place lease and (2) management’s estimate of fair market lease rates for each corresponding in-place lease, measured over a period equal to the remaining term of the lease for above-market leases and the initial term plus the term of any below-market fixed rate renewal options for below-market leases.
(2) Includes long-term incentive plan units (including 2012 OPP Units and 2013 - 2020 MYLTIP Units) but excludes the 2021 - 2023 MYLTIP Units because the three-year performance periods had not ended as of December 31, 2023. (3) See page 97 for additional information.
(2) Includes long-term incentive plan units (including 2012 OPP Units and 2013 - 2021 MYLTIP Units but excluding the 2022 - 2024 MYLTIP Units because the three-year performance periods had not ended as of December 31, 2024). (3) See page 88 for additional information. (4) See page 86 for additional information.
Based on BPLP’s February 20, 2024 credit rating, (1) the applicable Daily SOFR, Term SOFR, alternative currency daily rate, and alternative currency term rate margins are 0.850%, (2) the alternate base rate margin is zero basis points and (3) the facility fee is 0.20% per annum.
All other terms of the 2021 Credit Facility remain unchanged. Based on BPLP’s December 31, 2024 credit rating, (1) the applicable Daily SOFR, Term SOFR, alternative currency daily rate, and alternative currency term rate margins are 0.850%, (2) the alternate base rate margin is zero basis points and (3) the facility fee is 0.20% per annum.
Noncontrolling Interest—Common Units of the Operating Partnership For BXP, noncontrolling interest—common units of the Operating Partnership decreased by approximately $74.2 million for the year ended December 31, 2023 compared to 2022 due primarily to a decrease in allocable income, which was primarily the result of recognizing a non-cash impairment charge related to our investment in unconsolidated joint ventures during 2023 and a greater gain on sales of real estate amount during 2022.
Noncontrolling Interest—Common Units of the Operating Partnership For BXP, noncontrolling interest—common units of the Operating Partnership decreased by approximately $20.1 million for the year ended December 31, 2024 compared to 2023 due primarily to a decrease in allocable income, which was primarily the result of recognizing a greater non-cash impairment charge related to our investment in unconsolidated joint ventures during the year ended December 31, 2024.
This transaction was accounted for as an asset acquisition, and the purchase price was allocated based on the relative fair values of the assets acquired and liabilities assumed (See Note 3 to the Consolidated Financial Statements).
These transactions were accounted for as asset acquisitions, and the purchase price was allocated based on the relative fair values of the assets acquired and liabilities assumed (See Note 3 to the Consolidated Financial Statements).
(2) For a detailed discussion of NOI, including the reasons management believes NOI is useful to investors, see page 71. Residential Net Operating Income for the year ended December 31, 2023 and 2022 is comprised of Residential Revenue of $47,592 and $57,181 less Residential Expenses of $23,250 and $29,583, respectively.
(2) For a detailed discussion of NOI, including the reasons management believes NOI is useful to investors, see page 65. Residential Net Operating Income for the year ended December 31, 2024 and 2023 is comprised of Residential Revenue of $49,508 and $47,592 less Residential Expenses of $23,472 and $23,250, respectively.
(2) A portion of Shady Grove Innovation District and Lexington Office Park are no longer considered “in-service” because each property’s occupied percentage is less than 50% and we are no longer actively leasing the properties in anticipation of a future development/redevelopment.
(3) Lexington Office Park, 1050 and 1100 Winter Street, 17 Hartwell Avenue, Kingstowne One and a portion of Shady Grove Innovation District are no longer considered “in-service” because each property’s occupied percentage is less than 50% and we are no longer actively leasing the properties in anticipation of a future development/redevelopment.
(5) Our calculation includes OP Units and vested LTIP Units (including vested 2012 OPP Units and vested 2013 - 2020 MYLTIP Units).
(4) Our calculation includes OP Units and vested LTIP Units (including vested 2012 OPP Units and vested 2013 - 2021 MYLTIP Units).
The fair value of our debt obligations are affected by changes in the market interest rates. We manage our market risk by matching long-term leases with long-term, fixed-rate, non-recourse debt of similar duration.
Our primary market risk results from our indebtedness, which bears interest at fixed and variable rates. The fair value of our debt obligations are affected by changes in the market interest rates. We manage our market risk by matching long-term leases with long-term, fixed-rate, non-recourse debt of similar duration.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThese current conditions, or similar conditions existing in the future, may adversely affect our results of operations, financial condition and ability to pay dividends and/or distributions as a result of the following, among other potential consequences: • the financial condition of our clients may be adversely affected, which may result in client defaults under leases due to bankruptcy, lack of liquidity, lack of funding, operational failures or for other reasons; • significant job losses and/or a sustained shift away from collective in-person work environments or relocations away from the markets in which we operate may occur, which could decrease overall demand for workplaces in the regions in which we operate and cause market rental rates and property values to be negatively impacted; 26 T able of Contents • tightening labor market conditions may adversely affect our ability to recruit and retain talent, which may result in lack of business continuity and increased costs to address the labor challenges; • our ability to borrow on terms and conditions that we find acceptable, or at all, may be limited, which could reduce our ability to pursue acquisition and development opportunities and refinance existing debt, reduce our returns from our acquisition and development activities and increase our future interest expense; • reduced values of our properties may limit our ability to dispose of assets at attractive prices or to obtain debt financing secured by our properties and may reduce the availability of unsecured loans; • the value and liquidity of our short-term investments and cash deposits could be reduced as a result of a deterioration of the financial condition of the institutions that hold our cash deposits or the institutions or assets in which we have made short-term investments, a dislocation of the markets for our short-term investments, increased volatility in market rates for such investments or other factors; • one or more lenders under our line of credit could refuse to fund their financing commitment to us or could fail and we may not be able to replace the financing commitment of any such lenders on favorable terms, or at all; and • to the extent we enter into derivative financial instruments, one or more counterparties to our derivative financial instruments could default on their obligations to us, or could fail, increasing the risk that we may not realize the benefits of these instruments.
Biggest changeThese current conditions, or similar conditions existing in the future, may adversely affect our results of operations, financial condition and ability to pay dividends and distributions as a result of the following, among other potential consequences: • federal policy changes by the new presidential administration, such as the implementation of tariffs that could result in global supply chain disruptions and/or continued inflation, which could negatively impact 20 Table of Contents interest rates, potential changes to U.S. federal tax laws and budgetary changes related to government leases; • the financial condition of our clients may be adversely affected, which may result in client defaults under leases due to bankruptcy, lack of liquidity, lack of funding, operational failures or for other reasons; • significant job losses and/or a sustained shift away from collective in-person work environments or relocations away from the markets in which we operate may occur, which could decrease overall demand for workplaces in the regions in which we operate and cause market rental rates and property values to be negatively impacted; • our inability to borrow on terms and conditions that we find acceptable, or at all, which could reduce our ability to pursue acquisition and development opportunities and refinance existing debt, reduce our returns from our acquisition and development activities and increase our future interest expense; • reduced values of our properties may limit our ability to dispose of assets at attractive prices or to obtain debt financing secured by our properties and may reduce the availability of unsecured loans; • the value and liquidity of our short-term investments and cash deposits could be reduced as a result of a deterioration of the financial condition of the institutions that hold our cash deposits or the institutions or assets in which we have made short-term investments, a dislocation of the markets for our short-term investments, increased volatility in market rates for such investments or other factors; • one or more lenders under our line of credit could refuse to fund their financing commitment to us or could fail and we may not be able to replace the financing commitment of any such lenders on favorable terms, or at all; and • to the extent we enter into derivative financial instruments, one or more counterparties to our derivative financial instruments could default on their obligations to us, or could fail, increasing the risk that we may not realize the benefits of these instruments.
Depending on the specific circumstances of each affected property, it is possible that we could be liable for mortgage indebtedness or other obligations related to the property. Any such loss could materially and adversely affect our business and financial condition and results of operations.
Depending on the specific circumstances of each affected property, it is possible that we could be liable for mortgage indebtedness or other obligations related to the property. Any such loss could materially and adversely affect our business, financial condition and results of operations.
Any one or more of the foregoing could: • reduce our cash flows, • adversely impact our ability to finance, refinance or sell a property, • adversely impact our ability to continue paying distributions to our securityholders at current levels, or at all, and • result in additional legal and other costs to enforce our rights, collect rent and/or re-lease the space occupied by the distressed client; • the degree to which our clients’ businesses are negatively impacted could require us to write-off a client’s accrued rent balance and this could have a material adverse effect on our results of operations and liquidity; • new laws, governmental policies, and similar actions, including legal restrictions on prosecutions, could adversely impact public safety and thereby adversely affect (1) the desirability of clients to lease space in our properties or markets, and (2) businesses’ office re-population plans; • the impact of a pandemic could result in an event or change in circumstances that results in an impairment in the value of our properties or our investments in unconsolidated joint ventures, and any such impairment could have a material adverse effect on our results of operations in the periods in which the charge is taken; • we may be unable to restructure or amend leases with certain of our clients on terms favorable to us or at all; 36 T able of Contents • the impact and validity of interpretations of lease provisions and applicable laws related to claims by clients regarding their obligations to pay rent as a result of a pandemic, and any adverse court rulings or decisions interpreting these provisions and laws, could have a material adverse effect on our results of operations and liquidity; • the impact of governmental and business travel limitations and restrictions could result in temporary or sustained periods of decreased demand for hotel stays at our hotel property; • the extent of labor shortages, disruptions in the supply chains, inflation impacting costs of materials, delays in permitting or inspections, and other factors could result in our failure to meet the development milestones set forth in any applicable lease agreement, which could provide the client the right to terminate its lease or entitle the client to monetary damages, delay the commencement or completion of construction and our anticipated lease-up plans for a development/redevelopment project or our overall development pipeline, including recognizing revenue for new leases, that may cause returns on investment to be less than projected, and/or increase the costs of construction of new or existing projects, any of which could adversely affect our investment returns, profitability and/or our future growth; and • the potential that business interruption, loss of rental income and/or other associated expenses related to our operations will not be covered in whole or in part by our insurance policies, which may increase unreimbursed liabilities.
Any one or more of the foregoing could: • reduce our cash flows, • adversely impact our ability to finance, refinance or sell a property, • adversely impact our ability to continue paying distributions to our securityholders at current levels, or at all, and • result in additional legal and other costs to enforce our rights, collect rent and/or re-lease the space occupied by the distressed client; • the degree to which our clients’ businesses are negatively impacted could require us to write-off a client’s accrued rent balance and this could have a material adverse effect on our results of operations and liquidity; • new laws, governmental policies, and similar actions, including legal restrictions on prosecutions, could adversely impact public safety and thereby adversely affect (1) the desirability of clients to lease space in our properties or markets, and (2) businesses’ office re-population plans; • the impact of a pandemic could result in an event or change in circumstances that results in an impairment in the value of our properties or our investments in unconsolidated joint ventures, and any such impairment could have a material adverse effect on our results of operations in the periods in which the charge is taken; • we may be unable to restructure or amend leases with certain of our clients on terms favorable to us or at all; • the impact and validity of interpretations of lease provisions and applicable laws related to claims by clients regarding their obligations to pay rent as a result of a pandemic, and any adverse court rulings or decisions interpreting these provisions and laws, could have a material adverse effect on our results of operations and liquidity; • the impact of governmental and business travel limitations and restrictions could result in temporary or sustained periods of decreased demand for hotel stays at our hotel property; • the extent of labor shortages, disruptions in the supply chains, inflation impacting costs of materials, delays in permitting or inspections, and other factors could result in our failure to meet the development milestones set forth in any applicable lease agreement, which could provide the client the right to terminate its lease or entitle the client to monetary damages, delay the commencement or completion of construction and our anticipated lease-up plans for a development/redevelopment project or our overall development pipeline, including recognizing revenue for new leases, that may cause returns on investment to be less than projected, and/or increase the costs of construction of new or existing projects, any of which could adversely affect our investment returns, profitability and/or our future growth; and • the potential that business interruption, loss of rental income and/or other associated expenses related to our operations will not be covered in whole or in part by our insurance policies, which may increase unreimbursed liabilities.
For example, many of our properties are located along the East and West coasts, particularly those in the central business districts of Boston, Los Angeles, New York, San Francisco, Seattle and Washington, DC. To the extent climate change causes changes in weather patterns, our markets could experience increases in storm intensity, extreme temperatures, rising sea-levels and/or drought.
For example, many of our properties are located along the East and West coasts, particularly those in the central business districts of Boston, Los Angeles, New York, San Francisco, Seattle and Washington, DC. To the extent climate change causes changes in weather patterns, our markets could experience increases in storm intensity, extreme temperatures, rising sea-levels, extreme drought and/or wildfires.
However, a security breach, incident, compromise or other significant disruption involving our IT networks and related systems could: • disrupt the proper functioning of our networks and systems and therefore our operations and/or those of certain of our clients; • result in misstated financial reports, violations of loan covenants, missed reporting deadlines and/or missed permitting deadlines; • result in our inability to properly monitor our compliance with the rules and regulations regarding BXP’s qualification as a REIT; • result in the unauthorized access to, and destruction, loss, theft, misappropriation or release of, proprietary, confidential, sensitive or otherwise valuable information of ours or others, which others could use to compete against us or which could expose us to damage and claims or threats by third-parties for disruptive, destructive or otherwise harmful purposes and outcomes; • result in our inability to maintain the building systems relied upon by our clients for the efficient use of their leased space; • require significant management attention and resources to remedy any damages that result; • subject us to claims for breach of contract, damages, credits, penalties or termination of leases or other agreements or subject us to litigation and regulatory investigations and related fines and penalties; • be uninsured or exceed policy limits, increase operating costs, including insurance expenses, or make future cyber risk coverage unavailable on commercially reasonable terms ; and • damage our reputation among our clients and investors generally.
However, a security breach, incident, compromise or other significant disruption involving our IT networks and related systems could: • disrupt the proper functioning of our networks and systems and therefore our operations and/or those of certain of our clients; • result in misstated financial reports, violations of loan covenants, missed reporting deadlines and/or missed permitting deadlines; • result in our inability to properly monitor our compliance with the rules and regulations regarding BXP’s qualification as a REIT; • result in the unauthorized access to, and destruction, loss, theft, misappropriation or release of, proprietary, confidential, sensitive or otherwise valuable information of ours or others, which others could use to compete against us or which could expose us to damage and claims or threats by third-parties for disruptive, destructive or otherwise harmful purposes and outcomes; • result in our inability to maintain the building systems relied upon by our clients for the efficient use of their leased space; • require significant management attention and resources to remedy any damages that result; • subject us to claims for breach of contract, damages, credits, penalties or termination of leases or other agreements or subject us to litigation and regulatory investigations and related fines and penalties; • be uninsured or exceed policy limits, increase operating costs, including insurance expenses, or make future cyber risk coverage unavailable on commercially reasonable terms ; and 29 Table of Contents • damage our reputation among our clients and investors generally.
Investments in international markets may also subject us to risks associated with funding increasing headcount, integrating new offices, and establishing effective controls and procedures to regulate the operations of new offices and to monitor compliance with U.S. laws and regulations such as the Foreign Corrupt Practices Act and similar foreign laws and regulations, such as the U.K. Bribery Act.
Investments in international markets may also subject us to risks associated with funding increasing headcount, integrating new offices, and establishing effective controls and procedures to regulate the operations of new offices and to monitor compliance with U.S. laws and regulations such as the Foreign Corrupt Practices Act and similar foreign laws and regulations, such as the U.K.
For example, in our Washington, DC market, we focus on leasing our properties to governmental agencies and contractors. In our West Coast market, our leasing is focused on clients in the technology and media industries, as well as legal firms. In addition, in our New York market, we have historically leased properties to financial, legal and other professional firms.
For example, in our Washington, DC market, we focus on leasing our properties to governmental contractors and legal firms. In our West Coast market, our leasing is focused on clients in the technology and media industries, as well as legal firms. In addition, in our New York market, we have historically leased properties to financial, legal and other professional firms.
We also currently carry nuclear, biological, chemical and radiological terrorism insurance coverage for acts of terrorism certified under the Federal Terrorism Risk Insurance Act (as amended, “TRIA”) (“NBCR Coverage”), which is provided by IXP as a direct insurer, for the properties in our portfolio, including 767 Fifth Avenue, but excluding certain other properties owned in joint ventures with third parties or which we manage.
We also currently carry nuclear, biological, chemical and radiological terrorism insurance coverage for acts of terrorism certified under the Federal Terrorism Risk Insurance Act (as amended, “TRIA”) (“NBCR Coverage”), which is provided by IXP, LLC (“IXP”) as a direct insurer, for the properties in our portfolio, including 767 Fifth Avenue, but excluding certain other properties owned in joint ventures with third parties or which we manage.
Making these loans subjects us to the following risks, each of which could have a material adverse effect on our cash flow, results of operations and/or financial condition: • the third party may be unable to make full and timely payments of interest and principal on the loan when due; • if the third-party buyer to whom we provide seller financing does not manage the property well, or the property otherwise fails to meet financial projections, performs poorly or declines in value, then the buyer may not have the funds or ability to raise new debt with which to make required payments of interest and principal to us; • if we loan funds to a joint venture, and the joint venture is unable to make required payments of interest or principal, or both, or there are disagreements with respect to the repayment of the loan or other matters, then we could have a resulting dispute with our partner(s), and such a dispute could harm our relationship(s) with our partner(s) and cause delays in developing or selling the property or the failure to properly manage the property; and • if we loan funds to a joint venture and the joint venture is unable to make required payments of interest and principal, or both, then we may exercise remedies available to us in the joint venture agreement that could allow us to increase our ownership interest or our control over major decisions, or both, which could result in an unconsolidated joint venture becoming consolidated with our financial statement; doing so could 30 T able of Contents require us to reallocate the purchase price among the various asset and liability components and this could result in material changes to our reported results of operations and financial condition.
Making these loans subjects us to the following risks, each of which could have a material adverse effect on our cash flow, results of operations and/or financial condition: • the third party may be unable to make full and timely payments of interest and principal on the loan when due; • if the third-party buyer to whom we provide seller financing does not manage the property well, or the property otherwise fails to meet financial projections, performs poorly or declines in value, then the buyer may not have the funds or ability to raise new debt with which to make required payments of interest and principal to us; • if we loan funds to a joint venture, and the joint venture is unable to make required payments of interest or principal, or both, or there are disagreements with respect to the repayment of the loan or other matters, then we could have a resulting dispute with our partner(s), and such a dispute could harm our relationship(s) with our partner(s) and cause delays in developing or selling the property or the failure to properly manage the property; and 24 Table of Contents • if we loan funds to a joint venture and the joint venture is unable to make required payments of interest and principal, or both, then we may exercise remedies available to us in the joint venture agreement that could allow us to increase our ownership interest or our control over major decisions, or both, which could result in an unconsolidated joint venture becoming consolidated with our financial statement; doing so could require us to reallocate the purchase price among the various asset and liability components and this could result in material changes to our reported results of operations and financial condition.
Our current and future development and construction activities may be exposed to the following risks: • we may be unable to proceed with the development of properties because we cannot obtain financing on favorable terms or at all; 28 T able of Contents • we may incur construction costs for a development project that exceed our original estimates due to increased materials, labor, leasing or other costs, increases in interest rates, or supply chain disruptions, any of which could make completion of the project less profitable because market rents may not increase sufficiently to compensate for the increase in construction costs; • we may be unable to obtain, or face delays in obtaining, required zoning, land-use, building, occupancy, and other governmental permits and authorizations, which could result in increased costs and could require us to abandon our activities entirely with respect to a project; • we may abandon development opportunities after we begin to explore them and, as a result, we may lose deposits or fail to recover expenses already incurred; • we may expend funds on and devote management’s time to projects that we do not complete; • we may be unable to complete construction and/or leasing of a property on schedule or at all; and • we may suspend development projects after construction has begun due to changes in economic conditions or other factors, and this may result in the write-off of costs, payment of additional costs or increases in overall costs when the development project is restarted.
Our current and future development and construction activities may be exposed to the following risks: • we may be unable to proceed with the development of properties because we cannot obtain financing on favorable terms or at all; 22 Table of Contents • we may incur construction costs for a development project that exceed our original estimates due to increased materials, labor, leasing or other costs, increases in interest rates, or supply chain disruptions, any of which could make completion of the project less profitable because market rents may not increase sufficiently to compensate for the increase in construction costs; • we may be unable to obtain, or face delays in obtaining, required zoning, land-use, building, occupancy, and other governmental permits and authorizations, which could result in increased costs and could require us to abandon our activities entirely with respect to a project; • we may abandon development opportunities after we begin to explore them and, as a result, we may lose deposits or fail to recover expenses already incurred; • we may expend funds on and devote management’s time to projects that we do not complete; • we may be unable to complete construction and/or leasing of a property on schedule or at all; and • we may suspend development projects after construction has begun due to changes in economic conditions or other factors, and this may result in the write-off of costs, payment of additional costs or increases in overall costs when the development project is restarted.
This section contains forward-looking statements. You should refer to the explanation of the qualifications and limitations on forward-looking statements beginning on page 58 . Risks Related to Our Business and Operations Our performance depends upon the economic conditions, particularly the supply and demand characteristics, of our markets—Boston, Los Angeles, New York, San Francisco, Seattle and Washington, DC.
This section contains forward-looking statements. You should refer to the explanation of the qualifications and limitations on forward-looking statements beginning on page 52 . Risks Related to Our Business and Operations Our performance depends upon the economic conditions, particularly the supply and demand characteristics, of our markets—Boston, Los Angeles, New York, San Francisco, Seattle and Washington, DC.
If BXP or any of its subsidiaries that are REITs fails to qualify as a REIT then, unless certain relief provisions apply, it will face serious tax consequences that will substantially reduce the funds available for payment of dividends for each of the years involved because: • BXP would not be allowed a deduction for dividends paid to stockholders in computing its taxable income and would be subject to federal income tax at regular corporate rates; 43 T able of Contents • BXP also could be subject to the federal alternative minimum tax for tax years ending before January 1, 2018 and possibly increased state and local taxes; and • unless BXP is entitled to relief under statutory provisions, BXP could not elect to be subject to tax as a REIT for four taxable years following the year during which it was disqualified.
If BXP or any of its subsidiaries that are REITs fails to qualify as a REIT then, unless certain relief provisions apply, it will face serious tax consequences that will substantially reduce the funds available for payment of dividends for each of the years involved because: • BXP would not be allowed a deduction for dividends paid to stockholders in computing its taxable income and would be subject to federal income tax at regular corporate rates; • BXP also could be subject to the federal alternative minimum tax for tax years ending before January 1, 2018 and possibly increased state and local taxes; and • unless BXP is entitled to relief under statutory provisions, BXP could not elect to be subject to tax as a REIT for four taxable years following the year during which it was disqualified.
The following factors, among others, may adversely affect the income generated by our properties: • downturns in the national, regional and local economic conditions (particularly increases in unemployment); • changes in client preferences and space utilization from full-time, collective in-person work environments to hybrid or remote work models, which could decrease overall demand for workplaces and cause market rental rates and property values to be negatively impacted; • competition from other office, life sciences, hotel, retail and residential buildings; • local real estate market conditions, such as oversupply or reduction in demand for office, life sciences, hotel, retail or residential space; • changes in interest rates and availability of financing; • vacancies, changes in market rental rates and the need to periodically repair, renovate and re-let space; 27 T able of Contents • delays in completion of development and redevelopment projects due to supply chain disruptions and labor shortages; • increased costs to maintain, renovate and develop our properties related to inflation; • changes in space utilization by our clients due to technology, economic conditions and business culture; • increased operating costs, including insurance expense, utilities, real estate taxes, state and local taxes and heightened security costs; • civil disturbances, earthquakes and other natural disasters or terrorist acts or acts of war which may result in uninsured or underinsured losses or decrease the desirability to our clients in impacted locations; • significant expenditures associated with each investment, such as debt service payments, real estate taxes (including reassessments and changes in tax laws), insurance and maintenance costs which are generally not reduced when circumstances cause a reduction in revenues from a property; • declines in the financial condition of our clients and our ability to collect rents from our clients; and • decreases in the underlying value of our real estate.
The following factors, among others, may adversely affect the income generated by our properties: • downturns in the national, regional and local economic conditions (particularly increases in unemployment); • changes in client preferences and space utilization from full-time, collective in-person work environments to hybrid or remote work models, which could decrease overall demand for workplaces and cause market rental rates and property values to be negatively impacted; 21 Table of Contents • competition from other office, life sciences, hotel, retail and residential buildings; • local real estate market conditions, such as oversupply or reduction in demand for office, life sciences, hotel, retail or residential space; • changes in interest rates and availability of financing; • vacancies, changes in market rental rates and the need to periodically repair, renovate and re-let space; • delays in completion of development and redevelopment projects due to supply chain disruptions and labor shortages; • increased costs to maintain, renovate and develop our properties related to inflation; • increased operating costs, including insurance expense, utilities, real estate taxes, state and local taxes and heightened security costs; • civil disturbances, earthquakes and other natural disasters or terrorist acts or acts of war which may result in uninsured or underinsured losses or decrease the desirability to our clients in impacted locations; • significant expenditures associated with each investment, such as debt service payments, real estate taxes (including reassessments and changes in tax laws), insurance and maintenance costs which are generally not reduced when circumstances cause a reduction in revenues from a property; • declines in the financial condition of our clients and our ability to collect rents from our clients; and • decreases in the underlying value of our real estate.
These tax protection and debt allocation agreements may restrict our ability to repay or refinance debt. As of December 31, 2023, we had one tax protection agreement that could restrict our ability to repay or finance debt. Our degree of leverage could limit our ability to obtain additional financing or affect the market price of our equity and debt securities.
These tax protection and debt allocation agreements may restrict our ability to repay or refinance debt. As of December 31, 2024, we had one tax protection agreement that could restrict our ability to repay or finance debt. Our degree of leverage could limit our ability to obtain additional financing or affect the market price of our equity and debt securities.
Further, rising interest rates could limit our ability to refinance existing debt when it matures or significantly increase our future interest expense. From time to time, we enter into interest rate swap agreements and other interest rate hedging contracts, including swaps, caps and floors.
Further, elevated interest rates could limit our ability to refinance existing debt when it matures or significantly increase our future interest expense. From time to time, we enter into interest rate swap agreements and other interest rate hedging contracts, including swaps, caps and floors.
Market and economic volatility due to adverse economic and geopolitical conditions, health crises or dislocations in the credit markets could have a material adverse effect on our results of operations, financial condition and ability to pay dividends and/or distributions.
Market and economic volatility due to adverse economic and political conditions, health crises or dislocations in the credit markets could have a material adverse effect on our results of operations, financial condition and ability to pay dividends and/or distributions.
Any inability of our cash flows to cover our distribution requirements could have an adverse impact on our ability to raise short- and long-term debt or sell equity securities in order to fund distributions required to maintain BXP’s REIT status. We may be subject to adverse legislative or regulatory tax changes that could negatively impact our financial condition.
Any inability of our cash flows to cover our distribution requirements could have an adverse impact on our ability to raise short- and long-term debt or sell equity securities in order to fund distributions required to maintain BXP’s REIT status. 38 Table of Contents We may be subject to adverse legislative or regulatory tax changes that could negatively impact our financial condition.
BPLP’s Partnership Agreement BXP has agreed in the limited partnership agreement of BPLP not to engage in specified extraordinary transactions, including, among others, business combinations, unless limited partners of BPLP other than BXP receive, or have the opportunity to receive, either (1) the same consideration for their partnership interests as 42 T able of Contents holders of BXP common stock in the transaction or (2) limited partnership units that, among other things, would entitle the holders, upon redemption of these units, to receive shares of common equity of a publicly traded company or the same consideration as holders of BXP common stock received in the transaction.
BPLP’s Partnership Agreement BXP has agreed in the limited partnership agreement of BPLP not to engage in specified extraordinary transactions, including, among others, business combinations, unless limited partners of BPLP other than BXP receive, or have the opportunity to receive, either (1) the same consideration for their partnership interests as holders of BXP common stock in the transaction or (2) limited partnership units that, among other things, would entitle the holders, upon redemption of these units, to receive shares of common equity of a publicly traded company or the same consideration as holders of BXP common stock received in the transaction.
Even though these environmental assessments are conducted, there is still the risk that: • the environmental assessments and updates did not identify or properly address all potential environmental liabilities; • a prior owner created a material environmental condition that is not known to us or the independent consultants preparing the assessments; • new environmental liabilities have developed since the environmental assessments were conducted; and • future uses or conditions such as changes in applicable environmental laws and regulations could result in environmental liability for us.
Even though these environmental assessments are conducted, there is still the risk that: 32 Table of Contents • the environmental assessments and updates did not identify or properly address all potential environmental liabilities; • a prior owner created a material environmental condition that is not known to us or the independent consultants preparing the assessments; • new environmental liabilities have developed since the environmental assessments were conducted; and • future uses or conditions such as changes in applicable environmental laws and regulations could result in environmental liability for us.
As a result of these provisions, a potential acquirer may be deterred from making an acquisition proposal, and BXP may be prohibited by contract from engaging in a proposed extraordinary transaction, including a proposed business combination, even though BXP stockholders approve of the transaction. We may change our policies without obtaining the approval of our stockholders.
As a result of these provisions, a potential acquirer may be deterred from making an acquisition proposal, and BXP may be prohibited by contract from engaging in a proposed extraordinary transaction, including a proposed business combination, even though BXP stockholders approve of the transaction. 37 Table of Contents We may change our policies without obtaining the approval of our stockholders.
The following factors, among others, are common to the hotel industry, and may reduce the receipts generated by our hotel property: • our hotel property competes for guests with other hotels, a number of which may have greater marketing and financial resources than our hotel-operating business partners; • if there is an increase in operating costs resulting from inflation and other factors, our hotel-operating business partners may not be able to offset such increase by increasing room rates; • our hotel property is subject to the fluctuating and seasonal demands of business travelers and tourism; and • our hotel property is subject to general and local economic and social conditions that may affect demand for travel in general, including public health concerns, war and terrorism.
The following factors, among others, are common to the hotel industry, and may reduce the receipts generated by our hotel property: • our hotel property competes for guests with other hotels, a number of which may have greater marketing and financial resources than our hotel-operating business partners; • if there is an increase in operating costs resulting from inflation and other factors, our hotel-operating business partners may not be able to offset such increase by increasing room rates; • our hotel property is subject to the fluctuating and seasonal demands of business travelers and tourism; and 26 Table of Contents • our hotel property is subject to general and local economic and social conditions that may affect demand for travel in general, including fluctuations in consumer spending, public health concerns, war and terrorism.
Under TRIA, after the payment of the required deductible 33 T able of Contents and coinsurance, the NBCR Coverage provided by IXP is backstopped by the Federal Government if the aggregate industry insured losses resulting from a certified act of terrorism exceed a “program trigger.” The program trigger is $200 million, the coinsurance is 20% and the deductible is 20% of the premiums earned by the insurer for the year prior to a claim.
Under TRIA, after the payment of the required deductible and coinsurance, the NBCR Coverage provided by IXP is backstopped by the Federal Government if the aggregate industry insured losses resulting from a certified act of terrorism exceed a “program trigger.” The program trigger is $200 million, the coinsurance is 20% and the deductible is 20% of the premiums earned by the insurer for the year prior to a claim.
If, under the Americans 38 T able of Contents with Disabilities Act, we are required to make substantial alterations and capital expenditures in one or more of our properties, including the removal of access barriers, it could adversely affect our financial condition and results of operations, as well as the amount of cash available for distribution to our securityholders.
If, under the Americans with Disabilities Act, we are required to make substantial alterations and capital expenditures in one or more of our properties, including the removal of access barriers, it could adversely affect our financial condition and results of operations, as well as the amount of cash available for distribution to our securityholders.
While these agreements are intended to lessen the impact of rising interest rates on us, they also expose us to the risk that the other parties to the agreements will not perform, we could incur significant costs associated with the settlement of the agreements, the agreements will be unenforceable and the underlying transactions will fail to qualify as highly-effective cash flow hedges under guidance included in ASC 815 “Derivatives and Hedging.” In 39 T able of Contents addition, an increase in interest rates could decrease the amounts third-parties are willing to pay for our assets, thereby limiting our ability to change our portfolio promptly in response to changes in economic or other conditions.
While these agreements are intended to lessen the impact of rising interest rates on us, they also expose us to the risk that the other parties to the agreements will not perform, we could incur significant costs associated with the settlement of the agreements, the agreements will be unenforceable and the underlying transactions will fail to qualify as highly-effective cash flow hedges under guidance included in ASC 815 “Derivatives and Hedging.” In addition, high interest rates could decrease the amounts third-parties are willing to pay for our assets, thereby limiting our ability to change our portfolio promptly in response to changes in economic or other conditions.
We have previously experienced adverse impacts on our business from the COVID-19 pandemic, and factors related to any future public health crises that could have a material adverse effect on our results of operations and financial condition include: • changes made by companies in response to a pandemic that could lead to a sustained shift away from collective in-person work environments or relocations away from the markets in which we operate, either of which could adversely affect the overall demand for workplaces in the regions in which we operate; • reduced economic activity and/or supply chain disruptions or delays in delivery of products, services or other materials necessary for our clients that impact our clients’ businesses, financial condition or liquidity may cause, one or more of our clients to be unable to meet their obligations to us, including their ability to make timely rental payments, in full or at all, or to otherwise seek modifications of such obligations, including rent concessions, deferrals or abatements, or to declare bankruptcy.
Factors related to any public health crises that could have a material adverse effect on our results of operations and financial condition include: • changes made by companies in response to a pandemic that could lead to a sustained shift away from collective in-person work environments or relocations away from the markets in which we operate, either of which could adversely affect the overall demand for workplaces in the regions in which we operate; • reduced economic activity and/or supply chain disruptions or delays in delivery of products, services or other materials necessary for our clients that impact our clients’ businesses, financial condition or liquidity may cause, one or more of our clients to be unable to meet their obligations to us, including their ability to make timely rental payments, in full or at all, or to otherwise seek modifications of such 30 Table of Contents obligations, including rent concessions, deferrals or abatements, or to declare bankruptcy.
Any future impairment could have a material adverse effect on our results of operations in the period in which the charge is taken.
Any future impairments could have a material adverse effect on our results of operations in the period in which the charge is taken.
See also “ —Some potential losses are not covered by insurance. ” 34 T able of Contents We face risks associated with security breaches, incidents, and compromises through cyber-attacks, cyber intrusions or otherwise, as well as other significant disruptions of our information technology (IT) networks and related systems.
See also “ —Some potential losses are not covered by insurance. ” We face risks associated with security breaches, incidents, and compromises through cyber-attacks, cyber intrusions or otherwise, as well as other significant disruptions of our information technology (IT) networks and related systems.
The presence or migration of hazardous or toxic 37 T able of Contents substances or petroleum products or the failure to properly remediate contamination may give rise to third-party claims for bodily injury, property damage and/or response costs and may materially and adversely affect our ability to borrow against, sell or rent an affected property.
The presence or migration of hazardous or toxic substances or petroleum products or the failure to properly remediate contamination may give rise to third-party claims for bodily injury, property damage and/or response costs and may materially and adversely affect our ability to borrow against, sell or rent an affected property.
An unfavorable resolution of any legal proceeding or other claim could have a material adverse effect on our financial condition or results from operations. Regardless of its outcome, legal proceedings and other claims may result in substantial costs and expenses and significantly divert 45 T able of Contents the attention of our management.
An unfavorable resolution of any legal proceeding or other claim could have a material adverse effect on our financial condition or results from operations. Regardless of its outcome, legal proceedings and other claims may result in substantial costs and expenses and significantly divert the attention of our management.
These agreements may hinder actions that BPLP may otherwise desire to take to repay or refinance guaranteed indebtedness because doing so would require BPLP to make payments to the prior owners if BPLP violates these agreements. Limits on changes in control may discourage takeover attempts beneficial to stockholders.
These agreements may hinder actions that BPLP may otherwise desire to take to repay or refinance guaranteed indebtedness because doing so would require BPLP to make payments to the prior owners if BPLP violates these agreements. 36 Table of Contents Limits on changes in control may discourage takeover attempts beneficial to stockholders.
These increased tax costs could adversely affect our financial condition and results of operations and the amount of cash available for the payment of dividends and distributions to our securityholders. 44 T able of Contents General Risk Factors Changes in market conditions could adversely affect the market price of BXP’s common stock.
These increased tax costs could adversely affect our financial condition and results of operations and the amount of cash available for the payment of dividends and distributions to our securityholders. General Risk Factors Changes in market conditions could adversely affect the market price of BXP’s common stock.
Certain properties, including the General Motors Building located at 767 Fifth Avenue in New York, New York (“767 Fifth Avenue”), are currently insured in separate insurance programs. The property insurance program per occurrence limits for 767 Fifth Avenue are $1.625 billion, including Terrorism Coverage.
Certain properties, including the General Motors Building located at 767 27 Table of Contents Fifth Avenue in New York, New York (“767 Fifth Avenue”), are currently insured in separate insurance programs. The property insurance program per occurrence limits for 767 Fifth Avenue are $1.625 billion, including Terrorism Coverage.
We face risks associated with the development of mixed-use commercial properties. We operate, are currently developing, and may in the future develop, properties either alone or through joint ventures with other persons that are known as “mixed-use” developments.
We face risks associated with the development of mixed-use commercial and residential properties. We operate, are currently developing, and may in the future develop, properties either alone or through joint ventures with other parties that are known as “mixed-use” properties.
Unknown liabilities with respect to acquired properties might include: • liabilities for clean-up of undisclosed environmental contamination; • claims by clients, vendors or other persons against the former owners of the properties; • liabilities incurred in the ordinary course of business; and 31 T able of Contents • claims for indemnification by general partners, directors, officers and others indemnified by the former owners of the properties.
Unknown liabilities with respect to acquired properties might include: 25 Table of Contents • liabilities for clean-up of undisclosed environmental contamination; • claims by clients, vendors or other persons against the former owners of the properties; • liabilities incurred in the ordinary course of business; and • claims for indemnification by general partners, directors, officers and others indemnified by the former owners of the properties.
This could result in an overall decrease in the demand for office space in these markets generally or in our properties in particular, which could increase vacancies in our properties or necessitate that we lease our properties on less favorable terms or both.
This could result in an overall decrease in the demand for office space in these markets 28 Table of Contents generally or in our properties in particular, which could increase vacancies in our properties or necessitate that we lease our properties on less favorable terms or both.
Our success depends on key personnel whose continued service is not guaranteed. We depend on the efforts of key personnel, particularly Owen D. Thomas, Chief Executive Officer, Douglas T. Linde, President, and Raymond A. Ritchey, Senior Executive Vice President. Among the reasons that Messrs.
Our success depends on key personnel whose continued service is not guaranteed. We depend on the efforts of key personnel, particularly Owen D. Thomas, Chief Executive Officer, Douglas T. Linde, President, Raymond A. Ritchey, Senior Executive Vice President, and Michael E. LaBelle, Executive Vice President, Chief Financial Officer & Treasurer. Among the reasons that Messrs.
In addition, a significant economic downturn over a period of time could result in an event or change in circumstances that results in an “other than temporary” impairment in the value of our properties or our investments in unconsolidated joint ventures.
In addition, a significant economic downturn over a period of time could result in an event or change in circumstances that results in an impairment of a long-lived asset or an “other than temporary” impairment in the value of our investments in unconsolidated joint ventures.
(2) Includes LTIP Units (including 2012 OPP Units and earned MYLTIP Units that were granted between 2013 - 2021), but excludes MYLTIP Units granted between 2022 and 2024 because the performance period for those awards has not yet ended.
(2) Includes LTIP Units (including 2012 OPP Units and earned MYLTIP Units that were granted between 2013 - 2022), but excludes MYLTIP Units granted between 2023 and 2025 because the performance period for those awards has not yet ended.
Thomas, Linde and Ritchey are important to our success is that each has a national reputation, which attracts business and investment opportunities and assists us in negotiations with lenders, joint venture partners and other investors. If we lost their services, our relationships with lenders, potential clients and industry personnel could diminish.
Thomas, Linde, Ritchey and LaBelle are important to our success is that each has a national reputation, which attracts business and investment opportunities and assists us in negotiations with lenders, joint venture partners and other investors. If we lost their services, our relationships with lenders, potential clients and industry personnel could diminish. Our Regional Managers also have strong reputations.
We face risks associated with short-term liquid investments. We may invest cash balances in a variety of short-term investments that are intended to preserve principal value and maintain a high degree of liquidity while providing current income. From time to time, these investments may include (either directly or indirectly): • direct obligations issued by the U.S.
We may invest cash balances in a variety of short-term investments that are intended to preserve principal value and maintain a high degree of liquidity while providing current income. From time to time, these investments may include (either directly or indirectly): • direct obligations issued by the U.S. Treasury; • obligations issued or guaranteed by the U.S.
This means that in addition to the development of office space, the project may also include space for residential, retail, hotel or other commercial purposes. We have less experience in developing and managing non-office and non-retail real estate than we do with office real estate.
For mixed-use developments, this means that in addition to the development of office space, the project may also include space for residential, retail, hotel or other commercial purposes. We are also developing, and may in the future develop, residential buildings. We have less experience in developing and managing non-office and non-retail real estate than we do with office real estate.
We may be subject to risks from potential fluctuations in exchange rates between the U.S. dollar and the currencies of the other countries in which we invest.
Bribery Act. 33 Table of Contents We may be subject to risks from potential fluctuations in exchange rates between the U.S. dollar and the currencies of the other countries in which we invest.
As interest rates have increased, the interest costs on our unhedged variable rate debt have also increased, which, if sustained or continues to increase, could adversely affect our cash flow and our ability to pay principal and interest on our debt and our ability to make distributions to our securityholders.
As interest rates remain high, the interest costs on our unhedged variable rate debt have increased, which, if current rates are sustained or continue to increase, could adversely affect our cash flow and our ability to pay principal and interest on our debt and our ability to make distributions to our securityholders.
In addition, because our hotel property is located in Cambridge, Massachusetts, it is subject to the Cambridge market’s fluctuations in demand, increases in operating costs and increased competition from additions in supply. 32 T able of Contents Failure to comply with Federal Government contractor requirements could result in substantial costs and loss of substantial revenue.
In addition, because our hotel property is located in Cambridge, Massachusetts, it is subject to the Cambridge market’s fluctuations in demand, increases in operating costs and increased competition from additions in supply. Failure to comply with Federal Government contractor requirements could result in substantial costs and loss of substantial revenue. As of December 31, 2024, the U.S.
Sales of properties and repayment of related indebtedness will have different effects on holders of interests in BPLP than on BXP’s stockholders. Some holders of interests in BPLP could incur adverse tax consequences upon the sale of certain of our properties and on the repayment of related debt which differ from the tax consequences to BXP and its stockholders.
Some holders of interests in BPLP could incur adverse tax consequences upon the sale of certain of our properties and on the repayment of related debt which differ from the tax consequences to BXP and its stockholders.
We face significant competition from developers, owners and managers of office, life sciences and residential properties and other commercial real estate, including sublease space available from our clients. Substantially all of our properties face competition from similar properties in the same market.
This shortfall could adversely affect our cash flow and results of operations. Our properties face significant competition. We face significant competition from developers, owners and managers of office, life sciences and residential properties and other commercial real estate, including sublease space available from our clients. Substantially all of our properties face competition from similar properties in the same market.
Any one or more of the foregoing could have a material adverse effect on our results of operations, financial condition and cash flows. Refer to Part I, Item 1C.
Any one or more of the foregoing could have a material adverse effect on our results of operations, financial condition and cash flows. Refer to Part I, Item 1C. Cybersecurity in this Form 10-K for more information.
Risks Related to Our Indebtedness and Financing A sustained increase in interest rates would increase our interest costs on variable rate debt and could adversely impact our ability to refinance existing debt or sell assets on favorable terms or at all.
Risks Related to Our Indebtedness and Financing Elevated interest rates have, and may continue to increase our interest costs on variable rate debt and could adversely impact our ability to refinance existing debt or sell assets on favorable terms or at all.
There is a risk that changes in our debt to market capitalization ratio, which is in part a function of BXP’s stock price, or BPLP’s ratio of indebtedness to other measures of asset value used by financial analysts may have an adverse effect on the market price of our equity or debt securities.
There is a risk that changes in our debt to market capitalization ratio, which is in part a function of BXP’s stock price, or BPLP’s ratio of indebtedness to other measures of asset value used by financial analysts may have an adverse effect on the market price of our equity or debt securities. 35 Table of Contents We face risks associated with short-term liquid investments.
Such adverse economic and geopolitical conditions may be due to, among other issues, prolonged labor market challenges impacting the recruitment and retention of talent, continued inflation, high interest rates, volatility in the public equity and debt markets, and international economic and other conditions, including pandemics, geopolitical instability and other conditions beyond our control.
Such adverse economic and political conditions may include, among other issues, continued inflation, elevated interest rates, policy changes by the new presidential administration, prolonged labor market challenges impacting the recruitment and retention of talent, volatility in the public equity and debt markets, and international economic and other conditions, including pandemics, geopolitical instability and other conditions beyond our control.
In addition, our unsecured debt agreements contain specific cross-default provisions with respect to specified other indebtedness, giving the unsecured lenders the right to declare a default if we are in default under other loans in some circumstances. Defaults under our debt agreements could materially and adversely affect our financial condition and results of operations.
In addition, our unsecured debt agreements contain specific cross-default provisions with respect to specified other indebtedness, giving the unsecured lenders the right to declare a default if we are in default under other loans in some circumstances.
If our future earnings or cash dividends are less than expected, it is likely that the market price of BXP’s common stock will diminish. Further issuances of equity securities may be dilutive to current securityholders. The interests of our existing securityholders could be diluted if additional equity securities are issued to finance future developments, acquisitions or repay indebtedness.
If our future earnings or cash dividends are less than expected, it is likely that the market price of BXP’s common stock will diminish. 39 Table of Contents Further issuances of equity securities may be dilutive to current securityholders.
There is a risk that we may not be able to refinance existing debt or that the terms of any refinancing will not be as favorable as the terms of our existing debt.
Therefore, we are likely to need to refinance at least a portion of our outstanding debt as it matures. There is a risk that we may not be able to refinance existing debt or that the terms of any refinancing will not be as favorable as the terms of our existing debt.
We face risks associated with the use of debt to fund acquisitions and developments, including refinancing risk. We are subject to the risks normally associated with debt financing, including the risk that our cash flow will be insufficient to meet required payments of principal and interest.
We are subject to the risks normally associated with debt financing, including the risk that our cash flow will be insufficient to meet required payments of principal and interest. We anticipate that only a small portion of the principal of our debt will be repaid prior to maturity.
For additional discussion regarding our approach to climate resiliency and our continued commitment to transparent reporting of sustainability performance indicators, see “ Item 1. Business—Business and Growth Strategies—Sustainability ” and our annual Sustainability & Impact Report available on our website at http://www.bxp.com under the heading “Commitment.” Potential liability for environmental contamination could result in substantial costs.
Business—Business and Growth Strategies—Sustainability ” and our annual Sustainability & Impact Report available on our website at http://www.bxp.com under the heading “Commitment.” Potential liability for environmental contamination could result in substantial costs.
If we hire a third party manager, we would be dependent on them and their key personnel who provide services to us and we may not find a suitable replacement if the management agreement is terminated, or if key personnel leave or otherwise become unavailable to us.
If we hire a third party manager, we would be dependent on them and their key personnel who provide services to us and we may not find a suitable replacement if the management agreement is terminated, or if key personnel leave or otherwise become unavailable to us. 23 Table of Contents Our use of joint ventures may limit our control over and flexibility with jointly owned investments and other assets we may wish to acquire.
In addition, we face transition risks related to federal, state and local legislation and regulations that are being implemented, are under consideration to mitigate the effects of climate change or that require increased environmental disclosures and reporting. The costs of complying with evolving regulatory requirements, including GHG emissions regulations and policies, could negatively impact our financial results.
In addition, we face transition risks related to federal, state and local legislation and regulations that are being implemented, are under consideration to 31 Table of Contents mitigate the effects of climate change or that require increased environmental disclosures and reporting.
While we believe that we could find replacements for these key personnel, the loss of their services could materially and adversely affect our operations because of diminished relationships with lenders, prospective clients and industry personnel. Risks Related to Real Estate Our performance and value are subject to risks associated with our real estate assets and with the real estate industry.
Their reputations aid us in identifying opportunities, having opportunities brought to us, and negotiating with clients and build-to-suit prospects. While we believe that we could find replacements for these key personnel, the loss of their services could materially and adversely affect our operations because of diminished relationships with lenders, prospective clients and industry personnel.
As of February 20, 2024, we had $2.1 billion outstanding indebtedness, excluding our unconsolidated joint ventures, that bears interest at a variable rate, and we may incur more indebtedness in the future. All of our variable rate debt has all been hedged with interest rates swaps to fix SOFR for all, or a portion of the applicable debt term.
As of February 21, 2025, we had $2.4 billion outstanding indebtedness, excluding our unconsolidated joint ventures, that bears interest at a variable rate, and we may incur more indebtedness in the future.
These laws regulate how we conduct business, require us to administer various compliance programs and require us to impose compliance responsibilities on some of our contractors.
Government was one of our largest clients by square feet. We are subject to compliance with a wide variety of complex legal requirements because we are a Federal Government contractor. These laws regulate how we conduct business, require us to administer various compliance programs and require us to impose compliance responsibilities on some of our contractors.
In addition, there is no guarantee that our investments in these securities or funds will be redeemable at par value.
In addition, there is no guarantee that our investments in these securities or funds will be redeemable at par value. A decline in the value of our investment or a delay or suspension of our right to redeem may have a material adverse effect on our results of operations or financial condition.
As of February 20, 2024, our Consolidated Debt was approximately $15.4 billion (excluding unconsolidated joint venture debt). 40 T able of Contents The following table presents Consolidated Market Capitalization as well as the corresponding ratios of Consolidated Debt to Consolidated Market Capitalization (dollars and shares / units in thousands): February 20, 2024 Shares / Units Outstanding Common Stock Equivalent Equivalent Value (1) Common Stock 157,011 157,011 $ 10,367,436 Common Operating Partnership Units 19,196 19,196 1,267,512 (2) Total Equity (A) 176,207 $ 11,634,948 Consolidated Debt (B) $ 15,366,713 Consolidated Market Capitalization (A + B) $ 27,001,661 Consolidated Debt/Consolidated Market Capitalization [B / (A + B)] 56.91 % _______________ (1) Values are based on the closing price per share of BXP’s Common Stock on February 20, 2024 of $66.03.
The following table presents Consolidated Market Capitalization as well as the corresponding ratios of Consolidated Debt to Consolidated Market Capitalization (dollars and shares / units in thousands): February 21, 2025 Shares / Units Outstanding Common Stock Equivalent Equivalent Value (1) Common Stock 158,210 158,210 $ 10,894,341 Common Operating Partnership Units 18,529 18,529 1,275,907 (2) Total Equity (A) 176,739 $ 12,170,248 Consolidated Debt (B) $ 15,682,822 Consolidated Market Capitalization (A + B) $ 27,853,070 Consolidated Debt/Consolidated Market Capitalization [B / (A + B)] 56.31 % _______________ (1) Values are based on the closing price per share of BXP’s Common Stock on February 21, 2025 of $68.86.
Our use of joint ventures may limit our control over and flexibility with jointly owned investments and other assets we may wish to acquire. In appropriate circumstances, we intend to acquire and recapitalize or develop, as applicable, properties in joint ventures with other persons or entities.
In appropriate circumstances, we intend to acquire and recapitalize or develop, as applicable, properties in joint ventures with other parties. We currently have joint ventures that are and are not consolidated within our financial statements.
During the year ended December 31, 2023, we recognized an other-than-temporary impairment loss on our investments in four unconsolidated joint ventures aggregating approximately $272.6 million (See Note 6 to the Consolidated Financial Statements). There can be no assurance that we will not take additional charges in the future related to the impairment of our assets or investments.
For the year ended December 31, 2024, we recognized an impairment of a long-lived asset of approximately $13.6 million and “other than temporary” impairments in the value of three of our investments in unconsolidated joint ventures aggregating approximately $341.3 million. For additional information on these impairments, see Notes 3 and 6 to the Consolidated Financial Statements.
A decline in the value of our investment or a delay or suspension of our right to redeem may have a material adverse effect on our results of operations or financial condition. 41 T able of Contents Risks Related to Our Organization and Structure Conflicts of interest exist with holders of interests in BPLP.
Risks Related to Our Organization and Structure Conflicts of interest exist with holders of interests in BPLP. Sales of properties and repayment of related indebtedness will have different effects on holders of interests in BPLP than on BXP’s stockholders.
Cybersecurity in this Form 10-K for more information. 35 T able of Contents We face risks associated with our clients and contractual counterparties being designated “Prohibited Persons” by the Office of Foreign Assets Control.
There can be no assurance that we will properly implement AI, and the failure to do so could have a material adverse effect on our results of operations or financial condition. We face risks associated with our clients and contractual counterparties being designated “Prohibited Persons” by the Office of Foreign Assets Control.
Removed
An “other than temporary” impairment loss is recognized if the carrying amount of the asset (1) is not recoverable over its expected holding period and (2) exceeds its fair value.
Added
Risks Related to Real Estate Our performance and value are subject to risks associated with our real estate assets and with the real estate industry.
Removed
Our Chief Financial Officer and Regional Managers also have strong reputations. Their reputations aid us in identifying opportunities, having opportunities brought to us, and negotiating with clients and build-to-suit prospects.
Added
The use of technology based on artificial intelligence and machine learning presents risks and challenges that may adversely affect our business and results of operations. We use artificial intelligence and machine learning technology (collectively, “AI”) capabilities with the goal of enhancing efficiencies in conducting our business. Our deployment and application of AI remains ongoing.
Removed
This shortfall could adversely affect our cash flow and results of operations. On November 6, 2023, WeWork Inc. and certain of its direct and indirect subsidiaries (collectively, “WeWork”) filed voluntary petitions to commence proceedings under Chapter 11 of title 11 of the United States Code in the United States Bankruptcy Court for the District of New Jersey.
Added
While these AI tools hold promise in optimizing our work processes and driving efficiencies, they also present risks, challenges and unintended consequences that could adversely affect our business and results of operations or those of our clients.
Removed
As of December 31, 2023, WeWork was one of our 20 largest clients (based on our share of square footage). There can be no assurance that WeWork will not reject one or more of the four leases. Our properties face significant competition.
Added
These include, but are not limited to: • the release, leak or disclosure of proprietary, confidential, sensitive or otherwise valuable information as a result of or in connection with our use of AI tools, • the incorporation of AI by our clients, vendors, contractors and other third-parties into their products or services, with or without our knowledge, in a manner that could give rise to issues pertaining to data privacy, information security and intellectual property considerations, and • the evolving legal regulations relating to AI, which may require significant resources to modify and maintain business practices to comply with applicable law or otherwise result in legal or regulatory action or create additional liabilities, the nature of which cannot be determined at this time.
Removed
We currently have joint ventures that are and are not consolidated 29 T able of Contents within our financial statements.
Added
While we aim to use AI responsibly and securely and attempt to mitigate ethical and legal issues presented by its use, we may ultimately be unsuccessful in identifying or resolving issues before they arise.
Removed
As of December 31, 2023, the U.S. Government was one of our largest clients by square feet. We are subject to compliance with a wide variety of complex legal requirements because we are a Federal Government contractor.
Added
The costs of complying with evolving regulatory requirements, including GHG emissions regulations and policies, could negatively impact our financial results. For additional discussion regarding our approach to climate resiliency and our continued commitment to transparent reporting of sustainability performance indicators, see “ Item 1.
Removed
Interest rates increased throughout 2023, and may remain elevated throughout 2024.
Added
Approximately $0.9 billion of our variable rate debt has all been hedged with interest rates swaps to fix SOFR for all, or a portion of the applicable debt term. Interest rates remained elevated throughout 2024 and are expected to remain elevated through 2025.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeIn January 2024, our IS leadership expanded to include our CIO, who has 30 years of technology experience developed across multiple industries, including commercial real estate, in guiding organizations through strategic initiatives that span technology, cybersecurity, and digital transformations. 46 T able of Contents We maintain written information security policies and procedures, including a Cybersecurity Incident Response Plan (“CIRP”) for incidents involving potential or actual compromises of information security.
Biggest changeIn January 2024, our IS leadership expanded to include our CIO, who has 30 years of technology experience developed across multiple industries, including commercial real estate, in guiding organizations through strategic initiatives that span technology, cybersecurity, and digital transformations.
We have a data security committee, consisting of members from various BXP departments, including IS, legal and risk management, that meets periodically to assess, identify and manage cybersecurity risks related to certain third-party service providers and to protect our critical financial and sensitive business information, as well as personally identifiable information (collectively, “Sensitive Information”).
We have a data security committee, 41 Table of Contents consisting of members from various BXP departments, including IS, legal and risk management, that meets periodically to assess, identify and manage cybersecurity risks related to certain third-party service providers and to protect our critical financial and sensitive business information, as well as personally identifiable information (collectively, “Sensitive Information”).
The risk of a security breach, incident, compromise or disruption, particularly through cyber-attack or cyber intrusion, including by computer hackers, foreign governments and cyber terrorists, has generally increased as the number, intensity and sophistication of attempted attacks and intrusions from around the world have increased.
The risk of a security breach, incident, compromise or disruption, particularly through cyber-attack or cyber intrusion, including by computer hackers, foreign governments and cyber terrorists, has generally increased as the number, intensity and 40 Table of Contents sophistication of attempted attacks and intrusions from around the world have increased.
The Audit Committee provides regular updates to the full Board of Directors on matters under its purview, including risk management and cybersecurity matters. 47 T able of Contents
The Audit Committee provides regular updates to the full Board of Directors on matters under its purview, including risk management and cybersecurity matters.
Our CIRP is overseen by the cyber executive response team, which is chaired by our Vice President, Risk Management and includes representatives from our IS and legal departments.
We maintain written information security policies and procedures, including a Cybersecurity Incident Response Plan (“CIRP”) for incidents involving potential or actual compromises of information security. Our CIRP is overseen by the cyber executive response team, which is chaired by our Vice President, Risk Management and includes representatives from our IS and legal departments.

Item 2. Properties

Properties — owned and leased real estate

18 edited+7 added−9 removed1 unchanged
Biggest change(30% ownership) (2) Washington, DC 98.5 % 1 230,900 751 Gateway (49% ownership) (2) South San Francisco, CA 100.0 % 1 230,592 90 Broadway Cambridge, MA 98.1 % 1 223,771 Sumner Square Washington, DC 90.7 % 1 219,412 255 Main Street Cambridge, MA 87.9 % 1 215,394 20 CityPoint Waltham, MA 98.1 % 1 211,476 77 CityPoint Waltham, MA 97.8 % 1 209,711 49 T able of Contents Properties Location % Occupied as of December 31, 2023 (1) Number of Buildings Net Rentable Square Feet University Place Cambridge, MA 100.0 % 1 195,282 North First Business Park (5) San Jose, CA 87.6 % 5 190,636 890 Winter Street Waltham, MA 56.6 % 1 179,312 150 Broadway Cambridge, MA 100.0 % 1 177,226 Capital Gallery Washington, DC 80.8 % 1 176,809 206 Carnegie Center Princeton, NJ 100.0 % 1 161,763 210 Carnegie Center Princeton, NJ 79.2 % 1 159,468 Kingstowne Two Alexandria, VA 77.4 % 1 156,005 Kingstowne One Alexandria, VA 34.2 % 1 153,601 105 Broadway Cambridge, MA 100.0 % 1 152,664 212 Carnegie Center Princeton, NJ 69.2 % 1 148,942 214 Carnegie Center Princeton, NJ 65.9 % 1 146,799 2440 West El Camino Real Mountain View, CA 71.5 % 1 142,789 506 Carnegie Center Princeton, NJ 82.1 % 1 139,050 153 & 211 Second Avenue Waltham, MA — % 2 136,882 Two Reston Overlook Reston, VA 100.0 % 1 134,615 508 Carnegie Center Princeton, NJ 100.0 % 1 134,433 202 Carnegie Center Princeton, NJ 84.9 % 1 134,068 804 Carnegie Center Princeton, NJ 100.0 % 1 130,000 504 Carnegie Center Princeton, NJ 100.0 % 1 121,990 101 Carnegie Center Princeton, NJ 100.0 % 1 121,619 502 Carnegie Center Princeton, NJ 94.4 % 1 121,460 1265 Main Street (50% ownership) (2) Waltham, MA 100.0 % 1 120,681 701 Carnegie Center Princeton, NJ 100.0 % 1 120,000 104 Carnegie Center Princeton, NJ 63.8 % 1 102,930 103 Carnegie Center Princeton, NJ 73.5 % 1 96,331 33 Hayden Avenue Lexington, MA 100.0 % 1 80,876 Shady Grove Innovation District (6) Rockville, MD 75.9 % 1 78,915 Reservoir Place North Waltham, MA 100.0 % 1 73,258 32 Hartwell Avenue Lexington, MA 100.0 % 1 69,154 250 Binney Street Cambridge, MA 100.0 % 1 67,362 302 Carnegie Center Princeton, NJ 100.0 % 1 64,926 100 Hayden Avenue Lexington, MA 100.0 % 1 55,924 211 Carnegie Center Princeton, NJ 100.0 % 1 47,025 92 Hayden Avenue Lexington, MA 100.0 % 1 31,100 17 Hartwell Avenue Lexington, MA 100.0 % 1 30,000 453 Ravendale Drive Mountain View, CA 100.0 % 1 29,620 690 Folsom Street San Francisco, CA 100.0 % 1 26,080 201 Carnegie Center Princeton, NJ 100.0 % — 6,500 Subtotal for Office and Life Sciences Properties 88.3 % 160 47,935,650 Retail The Prudential Center (retail shops) (7) Boston, MA 95.5 % — 485,211 Fountain Square Retail Reston, VA 87.6 % 1 198,225 Kingstowne Retail Alexandria, VA 100.0 % 1 88,288 50 T able of Contents Properties Location % Occupied as of December 31, 2023 (1) Number of Buildings Net Rentable Square Feet Santa Monica Business Park Retail Santa Monica, CA 88.4 % 7 74,404 Star Market at the Prudential Center Boston, MA 100.0 % 1 57,236 Avant Retail Reston, VA 100.0 % 1 26,179 The Point Waltham, MA 100.0 % 1 16,300 Subtotal for Retail Properties 94.2 % 12 945,843 Residential Signature at Reston (508 units) Reston, VA 96.5 % 1 517,783 The Skylyne (402 units) Oakland, CA 86.1 % 1 330,996 Hub50House (440 units) (50% ownership) (2) Boston, MA 95.0 % 1 320,444 Proto Kendall Square (280 units) Cambridge, MA 96.1 % 1 166,717 The Lofts at Atlantic Wharf (86 units) Boston, MA 93.0 % 1 87,096 Subtotal for Residential Properties 93.4 % (8) 5 1,423,036 (9) Hotel Boston Marriott Cambridge (437 rooms) Cambridge, MA 72.8 % (10) 1 334,260 (11) Subtotal for Hotel Property 72.8 % 1 334,260 Subtotal for In-Service Properties 88.4 % 178 50,638,789 Properties Under Construction/Redevelopment (12) Office 360 Park Avenue South (redevelopment) (71% ownership) (2) (13) New York, NY 18.0 % 1 450,000 Reston Next Office Phase II Reston, VA 4.3 % 1 90,000 Laboratory/Life Sciences 103 CityPoint Waltham, MA — % 1 113,000 (14) 180 CityPoint Waltham, MA 43.0 % 1 329,000 (15) 300 Binney Street (redevelopment) (55% ownership) Cambridge, MA 100.0 % 1 236,000 651 Gateway (redevelopment) (50% ownership) (2) South San Francisco, CA 21.0 % 1 327,000 290 Binney Street Cambridge, MA 100.0 % 1 566,000 Residential Skymark - Reston Next Residential (508 units) (20% ownership) (2) Reston, VA — % 1 417,000 Retail 760 Boylston Street (redevelopment) Boston, MA 100.0 % 1 118,000 Reston Next Retail Reston, VA — % 1 33,000 Subtotal for Properties Under Construction/Redevelopment 53.5 % (16) 10 2,679,000 Total Portfolio 188 53,317,789 _______________ (1) Represents signed leases for in-service properties for which revenue recognition has commenced in accordance with accounting principles generally accepted in the United States (“GAAP”).
Biggest change(30% ownership) (2) Washington, DC 98.5 % 1 230,900 90 Broadway Cambridge, MA 100.0 % 1 223,771 255 Main Street Cambridge, MA 82.5 % 1 215,394 20 CityPoint Waltham, MA 98.1 % 1 211,476 77 CityPoint Waltham, MA 92.7 % 1 209,382 Sumner Square Washington, DC 95.6 % 1 208,797 University Place Cambridge, MA 100.0 % 1 195,282 North First Business Park (5) San Jose, CA 58.6 % 5 190,636 890 Winter Street Waltham, MA 70.6 % 1 180,159 150 Broadway Cambridge, MA 100.0 % 1 177,226 Capital Gallery Washington, DC 80.8 % 1 176,824 206 Carnegie Center Princeton, NJ — % 1 161,763 210 Carnegie Center Princeton, NJ 33.2 % 1 159,468 Kingstowne Two Alexandria, VA 55.8 % 1 156,005 105 Broadway Cambridge, MA 100.0 % 1 152,664 212 Carnegie Center Princeton, NJ 82.4 % 1 148,942 214 Carnegie Center Princeton, NJ 62.9 % 1 146,799 2440 West El Camino Real Mountain View, CA 71.5 % 1 142,711 506 Carnegie Center Princeton, NJ 77.2 % 1 139,050 Two Reston Overlook Reston, VA 100.0 % 1 134,615 508 Carnegie Center Princeton, NJ 100.0 % 1 134,433 202 Carnegie Center Princeton, NJ 71.9 % 1 134,068 804 Carnegie Center Princeton, NJ 100.0 % 1 130,000 101 Carnegie Center Princeton, NJ 82.6 % 1 122,791 504 Carnegie Center Princeton, NJ 100.0 % 1 121,990 502 Carnegie Center Princeton, NJ 98.6 % 1 121,460 1265 Main Street (50% ownership) (2) Waltham, MA 100.0 % 1 120,681 701 Carnegie Center Princeton, NJ 100.0 % 1 120,000 104 Carnegie Center Princeton, NJ 35.6 % 1 102,930 103 Carnegie Center Princeton, NJ 64.6 % 1 96,322 Reservoir Place North Waltham, MA 100.0 % 1 73,258 32 Hartwell Avenue Lexington, MA 100.0 % 1 69,154 302 Carnegie Center Princeton, NJ 100.0 % 1 64,926 211 Carnegie Center Princeton, NJ — % 1 47,025 92 Hayden Avenue Lexington, MA 100.0 % 1 31,100 44 Table of Contents Properties Location % Occupied as of December 31, 2024 (1) Number of Buildings Net Rentable Square Feet 453 Ravendale Drive Mountain View, CA 100.0 % 1 29,620 690 Folsom Street San Francisco, CA 100.0 % 1 26,080 201 Carnegie Center Princeton, NJ 100.0 % — 6,500 Subtotal for Office Properties 87.9 % 146 45,755,552 Life Sciences 180 CityPoint Waltham, MA 43.2 % 1 329,195 200 West Street Waltham, MA 86.1 % 1 273,365 125 Broadway Cambridge, MA 100.0 % 1 271,000 880 Winter Street Waltham, MA 100.0 % 1 243,618 300 Binney Street (55% ownership) Cambridge, MA 93.7 % 1 239,908 751 Gateway (49% ownership) (2) South San Francisco, CA 100.0 % 1 230,592 153 & 211 Second Avenue Waltham, MA 18.5 % 2 137,545 103 CityPoint Waltham, MA — % 1 112,841 33 Hayden Avenue Lexington, MA 100.0 % 1 80,876 250 Binney Street Cambridge, MA 100.0 % 1 67,362 100 Hayden Avenue Lexington, MA 100.0 % 1 55,924 Subtotal for Life Sciences Properties 77.2 % 12 2,042,226 Retail The Prudential Center (retail shops) Boston, MA 89.5 % 1 601,552 Fountain Square Retail Reston, VA 95.2 % 1 196,421 Kingstowne Retail Alexandria, VA 100.0 % 1 88,288 Santa Monica Business Park Retail Santa Monica, CA 77.2 % 7 73,006 Star Market at the Prudential Center Boston, MA 100.0 % 1 60,015 Avant Retail Reston, VA 100.0 % 1 26,179 The Point Waltham, MA 100.0 % 1 16,300 Subtotal for Retail Properties 91.6 % 13 1,061,761 Residential Signature at Reston (508 units) Reston, VA 94.3 % 1 517,783 Skymark - Reston Next Residential (508 units) (20% ownership) (2) Reston, VA 39.0 % 1 417,036 The Skylyne (402 units) Oakland, CA 90.8 % 1 330,996 Hub50House (440 units) (50% ownership) (2) Boston, MA 94.3 % 1 320,444 Proto Kendall Square (280 units) Cambridge, MA 94.3 % 1 166,717 The Lofts at Atlantic Wharf (86 units) Boston, MA 98.8 % 1 87,096 Subtotal for Residential Properties 81.2 % (6) 6 1,840,072 (7) Hotel Boston Marriott Cambridge (437 rooms) Cambridge, MA 77.2 % (8) 1 334,260 (9) Subtotal for Hotel Property 77.2 % 1 334,260 Subtotal for In-Service Properties 87.5 % 178 51,033,871 45 Table of Contents Properties Location % Occupied as of December 31, 2024 (1) Number of Buildings Net Rentable Square Feet Properties Under Construction/Redevelopment (10) Office 360 Park Avenue South (redevelopment) (71% ownership) (2) New York, NY 23.0 % 1 450,000 (11) Reston Next Office Phase II Reston, VA 9.0 % 1 90,000 (12) 725 12th Street (redevelopment) Washington, DC 47.0 % 1 320,000 (13) Laboratory/Life Sciences 651 Gateway (redevelopment) (50% ownership) (2) South San Francisco, CA 21.0 % 1 327,000 (14) 290 Binney Street (55% ownership) Cambridge, MA 100.0 % 1 573,000 Residential 121 Broadway Street (439 units) Cambridge, MA — % 1 492,000 Retail Reston Next Retail Reston, VA 13.0 % 1 33,000 Subtotal for Properties Under Construction/Redevelopment 50.3 % (15) 7 2,285,000 Total Portfolio 185 53,318,871 _______________ (1) Represents signed leases for in-service properties for which revenue recognition has commenced in accordance with accounting principles generally accepted in the United States (“GAAP”).
(4) Represents the monthly contractual base rent under expiring leases with future contractual increases upon expiration and recoveries from clients under existing leases as of December 31, 2023 multiplied by twelve. This amount reflects total rent before any rent abatements and includes expense reimbursements, which may be estimates as of such date.
(4) Represents the monthly contractual base rent under expiring leases with future contractual increases upon expiration and recoveries from clients under existing leases as of December 31, 2024 multiplied by twelve. This amount reflects total rent before any rent abatements and includes expense reimbursements, which may be estimates as of such date.
(3) Represents the monthly contractual base rent and recoveries from clients under existing leases as of December 31, 2023 multiplied by twelve. This amount reflects total rent before any rent abatements and includes expense reimbursements, which may be estimates as of such date.
(3) Represents the monthly contractual base rent and recoveries from clients under existing leases as of December 31, 2024 multiplied by twelve. This amount reflects total rent before any rent abatements and includes expense reimbursements, which may be estimates as of such date.
The table set forth below shows information relating to the properties we owned, or in which we had an ownership interest, at December 31, 2023, and it includes properties held by both consolidated and unconsolidated joint ventures.
The table set forth below shows information relating to the properties we owned, or in which we had an ownership interest, at December 31, 2024, and it includes properties held by both consolidated and unconsolidated joint ventures.
Item 2. Properties. At December 31, 2023, we owned or had joint venture interests in 188 commercial real estate properties, aggregating approximately 53.3 million net rentable square feet of primarily premier workplaces, including 10 properties under construction/redevelopment totaling approximately 2.7 million net rentable square feet.
Item 2. Properties. At December 31, 2024, we owned or had joint venture interests in 185 commercial real estate properties, aggregating approximately 53.3 million net rentable square feet of primarily premier workplaces, including seven properties under construction/redevelopment totaling approximately 2.3 million net rentable square feet.
This amount is not included in the calculation of the Total Portfolio occupancy rate for In-Service Properties as of December 31, 2023. (11) Includes 4,260 square feet of retail space that is 100% leased as of December 31, 2023.
This amount is not included in the calculation of the Total Portfolio occupancy rate for In-Service Properties as of December 31, 2024. (9) Includes 4,260 square feet of retail space that is 100% occupied as of December 31, 2024.
Our properties consisted of (1) 167 office and life sciences properties (including seven properties under construction/redevelopment), (2) 14 retail properties (including two properties under construction/redevelopment), (3) six residential properties (including one property under construction) and (4) one hotel.
Our properties consisted of (1) 163 office and life sciences properties (including five properties under construction/redevelopment), (2) 14 retail properties (including one property under construction), (3) seven residential properties (including one property under construction) and (4) one hotel.
(16) Total percentage leased excludes Residential. Percentage Occupied and Average Annualized Revenue per Square Foot for In-Service Properties The following table sets forth our percentage leased and average annualized revenue per square foot on a historical basis for our In-Service Properties.
Percentage Occupied and Average Annualized Revenue per Square Foot for In-Service Properties The following table sets forth our percentage occupied and average annualized revenue per square foot on a historical basis for our In-Service Properties.
(9) Includes 61,511 square feet of retail space that is approximately 79.2% leased as of December 31, 2023. This amount is not included in the calculation of the Total Portfolio occupancy rate for In-Service Properties as of December 31, 2023. (10) Represents the weighted-average room occupancy for the year ended December 31, 2023.
(7) Includes 61,511 square feet of retail space that is approximately 79.2% occupied as of December 31, 2024. This amount is not included in the calculation of the Total Portfolio occupancy rate for In-Service Properties as of December 31, 2024. (8) Represents the weighted-average room occupancy for the year ended December 31, 2024.
This amount is not included in the calculation of the Total Portfolio occupancy rate for In-Service Properties as of December 31, 2023. (12) Represents percentage leased as of February 20, 2024, including leases with future commencement dates.
This amount is not included in the calculation of the Total Portfolio occupancy rate for In-Service Properties as of December 31, 2024. (10) Represents percentage leased as of February 21, 2025, including leases with future commencement dates. (11) The property was 30% placed in-service as of December 31, 2024.
Bain Capital 315,833 0.75 % __________________ (1) Amounts are calculated based on our consolidated portfolio square feet, plus our share of the square feet from the unconsolidated joint ventures properties (calculated based on our ownership percentage), minus our partners’ share of square feet from our consolidated joint venture properties (calculated based upon the partners’ percentage ownership interests).
Mass Financial Services 313,584 0.74 % __________________ (1) Amounts are calculated based on our consolidated portfolio square feet, plus our share of the square feet from the unconsolidated joint ventures properties (calculated based on our ownership percentage), minus our partners’ share of square feet from our consolidated joint venture properties (calculated based upon the partners’ percentage ownership interests).
Client Diversification Our client diversification by square feet as of December 31, 2023 was as follows: Sector % of In-Service Portfolio (1) Technology & Media 21.3% Legal Services 17.5% Financial Services - all other 13.5% Real Estate & Insurance 9.0% Life Sciences 9.1% Other Professional Services 7.8% Financial Services - commercial & investment banking 5.8% Retail 5.8% Manufacturing 4.6% Government / Public Administration 3.0% Other 2.6% __________________ (1) Amounts are calculated based on our consolidated portfolio square feet, plus our share of the square feet from the unconsolidated joint ventures properties (calculated based on our ownership percentage), minus our partners’ share of square feet from our consolidated joint venture properties (calculated based upon the partners’ percentage ownership interests). 53 T able of Contents Lease Expirations (1)(2) Year of Lease Expiration Rentable Square Feet Subject to Expiring Leases Current Annualized Contractual Rent Under Expiring Leases Without Future Step-Ups (3) Current Annualized Contractual Rent Under Expiring Leases Without Future Step-Ups p.s.f.
Client Diversification Our client diversification by square feet as of December 31, 2024 was as follows: Sector % of In-Service Portfolio (1) Technology & Media 21.0% Legal Services 17.1% Financial Services - all other 14.4% Life Sciences 8.9% Real Estate & Insurance 8.7% Other Professional Services 7.6% Retail 6.2% Financial Services - commercial & investment banking 5.7% Manufacturing 4.7% Government / Public Administration 3.0% Other 2.7% 47 Table of Contents __________________ (1) Amounts are calculated based on our consolidated portfolio square feet, plus our share of the square feet from the unconsolidated joint ventures properties (calculated based on our ownership percentage), minus our partners’ share of square feet from our consolidated joint venture properties (calculated based upon the partners’ percentage ownership interests).
Properties Location % Occupied as of December 31, 2023 (1) Number of Buildings Net Rentable Square Feet Office and Life Sciences 767 Fifth Avenue (The GM Building) (60% ownership) New York, NY 91.6 % 1 1,966,490 200 Clarendon Street Boston, MA 96.8 % 1 1,734,949 601 Lexington Avenue (55% ownership) New York, NY 95.9 % 1 1,670,790 399 Park Avenue New York, NY 98.4 % 1 1,577,544 Salesforce Tower San Francisco, CA 99.0 % 1 1,420,682 800 Boylston Street - The Prudential Center Boston, MA 91.2 % 1 1,275,253 Times Square Tower (55% ownership) New York, NY 95.6 % 1 1,238,461 100 Federal Street (55% ownership) Boston, MA 90.6 % 1 1,233,537 Colorado Center (50% ownership) (2) Santa Monica, CA 87.8 % 6 1,131,511 Santa Monica Business Park Santa Monica, CA 83.8 % 14 1,108,201 599 Lexington Avenue New York, NY 92.4 % 1 1,106,313 Reston Next Reston, VA 88.4 % 2 1,063,296 Bay Colony Corporate Center Waltham, MA 53.6 % 4 1,001,068 250 West 55th Street New York, NY 100.0 % 1 966,976 Embarcadero Center Four San Francisco, CA 93.9 % 1 942,084 111 Huntington Avenue - The Prudential Center Boston, MA 100.0 % 1 860,446 200 Fifth Avenue (26.69% ownership) (2) New York, NY 92.5 % 1 855,059 Embarcadero Center One San Francisco, CA 72.8 % 1 837,386 Embarcadero Center Two San Francisco, CA 84.5 % 1 801,840 Atlantic Wharf Office (55% ownership) Boston, MA 99.8 % 1 790,165 Gateway Commons (50% Ownership) (2) South San Francisco, CA 79.7 % 5 788,148 Embarcadero Center Three San Francisco, CA 77.1 % 1 787,642 Safeco Plaza (33.67% ownership) (2) Seattle, WA 85.3 % 1 779,776 Madison Centre Seattle, WA 78.2 % 1 754,988 7750 Wisconsin Avenue (50% ownership) (2) Bethesda, MD 100.0 % 1 735,573 Dock 72 (50% ownership) (2) Brooklyn, NY 42.4 % 1 668,521 100 Causeway Street (50% ownership) (2) Boston, MA 94.5 % 1 634,535 South of Market Reston, VA 98.7 % 3 623,250 48 T able of Contents Properties Location % Occupied as of December 31, 2023 (1) Number of Buildings Net Rentable Square Feet 901 New York Avenue (25% ownership) (2) (3) Washington, DC 83.2 % 1 548,425 Mountain View Research Park Mountain View, CA 60.7 % 15 542,264 Reservoir Place Waltham, MA 43.8 % 1 527,029 680 Folsom Street San Francisco, CA 98.7 % 2 524,793 Fountain Square Reston, VA 87.0 % 2 524,638 101 Huntington Avenue - The Prudential Center Boston, MA 98.7 % 1 506,476 145 Broadway Cambridge, MA 99.6 % 1 490,086 2100 Pennsylvania Avenue Washington, DC 65.3 % 1 475,849 2200 Pennsylvania Avenue Washington, DC 94.9 % 1 459,811 One Freedom Square Reston, VA 82.8 % 1 427,956 Two Freedom Square Reston, VA 100.0 % 1 423,222 140 Kendrick Street (4) Needham, MA 84.4 % 3 418,600 Market Square North (50% ownership) (2) Washington, DC 77.0 % 1 418,549 325 Main Street Cambridge, MA 91.4 % 1 414,565 The Hub on Causeway - Podium (50% ownership) (2) Boston, MA 93.8 % 1 382,988 One and Two Discovery Square Reston, VA 89.7 % 2 366,989 888 Boylston Street - The Prudential Center Boston, MA 100.0 % 1 363,320 Weston Corporate Center Weston, MA 100.0 % 1 356,995 510 Madison Avenue New York, NY 98.7 % 1 355,089 One Reston Overlook Reston, VA 89.7 % 1 319,519 535 Mission Street San Francisco, CA 67.9 % 1 307,235 Wisconsin Place Office Chevy Chase, MD 64.2 % 1 302,858 Waltham Weston Corporate Center Waltham, MA 82.4 % 1 301,611 230 CityPoint Waltham, MA 94.6 % 1 296,720 17Fifty Presidents Street Reston, VA 100.0 % 1 275,809 200 West Street Waltham, MA 94.5 % 1 273,365 125 Broadway Cambridge, MA 100.0 % 1 271,000 Reston Corporate Center Reston, VA 100.0 % 2 261,046 355 Main Street Cambridge, MA 99.3 % 1 259,640 Democracy Tower Reston, VA 99.3 % 1 259,441 1330 Connecticut Avenue Washington, DC 87.4 % 1 253,579 880 Winter Street Waltham, MA 98.5 % 1 243,618 10 CityPoint Waltham, MA 100.0 % 1 236,570 510 Carnegie Center Princeton, NJ 33.5 % 1 234,160 500 North Capitol Street, N.W.
Properties Location % Occupied as of December 31, 2024 (1) Number of Buildings Net Rentable Square Feet Office 767 Fifth Avenue (The GM Building) (60% ownership) New York, NY 92.1 % 1 1,970,335 200 Clarendon Street Boston, MA 97.8 % 1 1,728,956 601 Lexington Avenue (55% ownership) New York, NY 95.7 % 1 1,670,502 399 Park Avenue New York, NY 99.9 % 1 1,567,470 Salesforce Tower San Francisco, CA 98.0 % 1 1,420,682 800 Boylston Street - The Prudential Center Boston, MA 96.4 % 1 1,274,927 7 Times Square (formerly Times Square Tower) (55% ownership) New York, NY 80.7 % 1 1,238,599 100 Federal Street (55% ownership) Boston, MA 89.0 % 1 1,233,537 Colorado Center (50% ownership) (2) Santa Monica, CA 89.6 % 6 1,130,066 599 Lexington Avenue New York, NY 95.8 % 1 1,106,335 42 Table of Contents Properties Location % Occupied as of December 31, 2024 (1) Number of Buildings Net Rentable Square Feet Santa Monica Business Park Santa Monica, CA 80.6 % 14 1,104,967 Reston Next Reston, VA 92.1 % 2 1,063,284 250 West 55th Street New York, NY 97.4 % 1 966,976 Embarcadero Center Four San Francisco, CA 93.4 % 1 942,640 111 Huntington Avenue - The Prudential Center Boston, MA 100.0 % 1 860,446 200 Fifth Avenue (26.69% ownership) (2) New York, NY 100.0 % 1 855,059 Embarcadero Center One San Francisco, CA 69.6 % 1 837,522 Embarcadero Center Two San Francisco, CA 88.3 % 1 801,498 Atlantic Wharf Office (55% ownership) Boston, MA 95.4 % 1 793,024 Embarcadero Center Three San Francisco, CA 83.1 % 1 785,911 Gateway Commons (50% Ownership) (2) (3) South San Francisco, CA 70.5 % 5 785,457 Safeco Plaza (33.67% ownership) (2) Seattle, WA 83.8 % 1 762,631 Madison Centre Seattle, WA 79.5 % 1 755,164 7750 Wisconsin Avenue (50% ownership) (2) Bethesda, MD 100.0 % 1 735,573 Dock 72 (50% ownership) (2) Brooklyn, NY 42.7 % 1 668,521 100 Causeway Street (50% ownership) (2) Boston, MA 96.4 % 1 633,818 South of Market Reston, VA 99.6 % 3 624,387 Bay Colony Corporate Center Waltham, MA 77.8 % 2 546,248 Mountain View Research Park Mountain View, CA 60.7 % 15 542,264 Reservoir Place Waltham, MA 36.6 % 1 526,215 Fountain Square Reston, VA 95.1 % 2 524,585 680 Folsom Street San Francisco, CA 59.2 % 2 522,406 901 New York Avenue Washington, DC 84.8 % 1 508,130 101 Huntington Avenue - The Prudential Center Boston, MA 99.0 % 1 506,476 145 Broadway Cambridge, MA 99.6 % 1 490,086 2100 Pennsylvania Avenue Washington, DC 94.2 % 1 475,849 2200 Pennsylvania Avenue Washington, DC 94.9 % 1 459,811 One Freedom Square Reston, VA 86.0 % 1 427,646 Two Freedom Square Reston, VA 99.8 % 1 423,222 140 Kendrick Street Needham, MA 73.3 % 3 418,600 Market Square North (50% ownership) (2) Washington, DC 76.2 % 1 417,298 325 Main Street Cambridge, MA 91.2 % 1 415,512 The Hub on Causeway - Podium (50% ownership) (2) Boston, MA 94.8 % 1 382,988 One and Two Discovery Square Reston, VA 89.7 % 2 366,989 888 Boylston Street - The Prudential Center Boston, MA 100.0 % 1 363,320 Weston Corporate Center Weston, MA 100.0 % 1 356,995 510 Madison Avenue New York, NY 90.1 % 1 352,589 One Reston Overlook Reston, VA 91.3 % 1 319,519 535 Mission Street San Francisco, CA 67.8 % 1 307,205 43 Table of Contents Properties Location % Occupied as of December 31, 2024 (1) Number of Buildings Net Rentable Square Feet Waltham Weston Corporate Center Waltham, MA 75.5 % 1 301,611 230 CityPoint Waltham, MA 97.7 % 1 296,720 Wisconsin Place Office Chevy Chase, MD 47.5 % 1 294,525 17Fifty Presidents Street Reston, VA 100.0 % 1 275,809 Reston Corporate Center (4) Reston, VA 100.0 % 2 261,046 Democracy Tower Reston, VA 99.3 % 1 259,441 355 Main Street Cambridge, MA 99.3 % 1 256,966 1330 Connecticut Avenue Washington, DC 92.3 % 1 252,262 10 CityPoint Waltham, MA 97.1 % 1 236,570 510 Carnegie Center Princeton, NJ 65.6 % 1 234,160 500 North Capitol Street, N.W.
December 31, 2023 2022 2021 2020 2019 Percentage occupied (1) 88.4 % 88.6 % 88.8 % 90.1 % 93.0 % Average annualized revenue per square foot (2) $78.81 $75.99 $73.76 $72.67 $69.72 _______________ (1) Represents signed leases, excluding hotel and residential properties, for which revenue recognition has commenced in accordance with GAAP.
December 31, 2024 2023 2022 2021 2020 Percentage occupied (1) 87.5 % 88.4 % 88.6 % 88.8 % 90.1 % Average annualized revenue per square foot (2) $81.21 $78.81 $75.99 $73.76 $72.67 _______________ (1) Represents signed leases, excluding hotel and residential properties, for which revenue recognition has commenced in accordance with GAAP. 46 Table of Contents (2) Represents the monthly contractual base rents and recoveries from clients under existing leases as of December 31, 2024, 2023, 2022, 2021 and 2020 multiplied by twelve.
(3) Current Annualized Contractual Rent Under Expiring Leases With Future Step-Ups (4) Current Annualized Contractual Rent Under Expiring Leases With Future Step-Ups p.s.f.
Lease Expirations (1)(2) Year of Lease Expiration Rentable Square Feet Subject to Expiring Leases Current Annualized Contractual Rent Under Expiring Leases Without Future Step-Ups (3) Current Annualized Contractual Rent Under Expiring Leases Without Future Step-Ups p.s.f. (3) Current Annualized Contractual Rent Under Expiring Leases With Future Step-Ups (4) Current Annualized Contractual Rent Under Expiring Leases With Future Step-Ups p.s.f.
(2) Represents the monthly contractual base rents and recoveries from clients under existing leases as of December 31, 2023, 2022, 2021, 2020 and 2019 multiplied by twelve. These annualized amounts are before rent abatements and include expense reimbursements, which may be estimates as of such date.
These annualized amounts are before rent abatements and include expense reimbursements, which may be estimates as of such date. The aggregate amounts of rent abatements per square foot under existing leases as of December 31, 2024, 2023, 2022, 2021 and 2020 for the succeeding twelve-month period were $2.14, $2.47, $1.56, $2.15, and $1.73, respectively.
Integrated Holding Group (aka Millennium Management) 373,007 0.88 % 13. Arnold & Porter Kaye Scholer 367,878 0.87 % 14. Marriott 367,787 0.87 % 15. WeWork 367,338 0.87 % 16. Leidos 352,394 0.83 % 17. Blue Cross Blue Shield 347,618 0.82 % 18. Bank of America 330,350 0.78 % 19. US Government 319,359 0.75 % 20.
Leidos 352,394 0.83 % 16. Blue Cross Blue Shield 347,618 0.82 % 17. Arnold & Porter Kaye Scholer 344,605 0.81 % 18. WeWork 337,457 0.79 % 19. US Government (2) 319,359 0.75 % 20.
Biogen 848,021 2.00 % 3. Google 836,110 1.97 % 4. Fannie Mae 710,121 1.68 % 5. Akamai Technologies 658,578 1.55 % 6. Snap 607,287 1.43 % 7. Microsoft 599,200 1.41 % 8. Ropes & Gray 539,467 1.27 % 9. Kirkland & Ellis 428,187 1.01 % 10. Wellington Management 401,665 0.95 % 11. Shearman & Sterling 384,813 0.91 % 12.
Snap 607,287 1.43 % 7. Microsoft 599,200 1.41 % 8. Ropes & Gray 539,467 1.27 % 9. Kirkland & Ellis 461,470 1.09 % 10. Integrated Holding Group 408,118 0.96 % 11. Wellington Management 405,225 0.95 % 12. Allen Overy Shearman Sterling 384,813 0.90 % 13. Bain Capital 378,284 0.89 % 14. Marriott 367,787 0.86 % 15.
Removed
(2) Property is an unconsolidated joint venture. (3) Our economic ownership has increased based on the achievement of certain return thresholds. At December 31, 2023, our economic ownership was approximately 50%.
Added
(2) Property is an unconsolidated joint venture. (3) Includes 681 Gateway, which is a laboratory/life sciences property. (4) Property was taken out of service on January 1, 2025. (5) Property is held for redevelopment. (6) Percentage occupied is not included in the calculation of the Total Portfolio occupancy rate for In-Service Properties as of December 31, 2024.
Removed
On January 8, 2024, our joint venture partner in 901 New York 51 T able of Contents Avenue transferred all of its ownership interest in the joint venture to us for a gross purchase price of $10.0 million (See Note 17 to the Consolidated Financial Statements).
Added
(12) The property was 6% placed in-service as of December 31, 2024. (13) We acquired 725 12th Street, on December 27, 2024 for a purchase price, excluding transaction costs, of $34.0 million. Concurrently with the acquisition, a lease was executed for approximately 152,000 square feet of the redeveloped building.
Removed
(4) On July 20, 2023, we completed and fully placed in-service 140 Kendrick Street - Building A, a redevelopment project with approximately 104,000 net rentable square feet in Needham, Massachusetts. (5) Property is held for redevelopment. (6) Property is held for redevelopment.
Added
(14) The property was 27% placed in-service as of December 31, 2024 and fully placed in-service on January 2, 2025. (15) Total percentage occupied excludes Residential.
Removed
Shady Grove Innovation District consists of 15825 Shady Grove Road. 2092 Gaither Road and 2098 Gaither Road were removed from in-service portfolio during 2023 and aggregated approximately 103,375 square feet.
Added
Top 20 Clients by Square Feet Our 20 largest clients by square feet as of December 31, 2024 were as follows: Client Square Feet (1) % of In-Service Portfolio (1) 1. Salesforce 891,231 2.10 % 2. Google 836,110 1.97 % 3. Biogen 780,659 1.84 % 4. Fannie Mae 710,121 1.67 % 5. Akamai Technologies 658,578 1.55 % 6.
Removed
(7) Excludes 760 Boylston Street, the stand-alone building consisting of approximately 118,000 square feet at The Prudential Center (retail shops) that was placed in redevelopment during the year ended December 31, 2022. (8) Percentage leased is not included in the calculation of the Total Portfolio occupancy rate for In-Service Properties as of December 31, 2023.
Added
(2) Amount includes approximately 261,046 square feet that expired on December 31, 2024.
Removed
(13) On December 14, 2023, we acquired an additional 29% ownership interest in the property, which has increased our total ownership to approximately 71% (See Note 6 to the Consolidated Financial Statements). (14) The property was 4% placed in-service as of December 31, 2023. (15) The property was 46% placed in-service as of December 31, 2023.
Added
(4) Percentage of Total Square Feet 2024 (5)(6) 390,847 $23,744,643 $60.75 $23,744,643 $60.75 0.80 % 2025 3,008,859 222,083,017 73.81 223,088,525 74.14 6.16 % 2026 1,864,176 162,007,646 86.91 166,250,784 89.18 3.82 % 2027 2,195,858 167,767,975 76.40 171,678,763 78.18 4.49 % 2028 3,570,229 301,652,841 84.49 322,664,501 90.38 7.31 % 2029 3,734,123 286,076,134 76.61 310,701,506 83.21 7.64 % 2030 2,735,795 216,748,858 79.23 236,311,071 86.38 5.60 % 2031 2,233,713 196,900,223 88.15 214,966,960 96.24 4.57 % 2032 2,885,652 221,634,397 76.81 263,763,756 91.41 5.91 % 2033 3,017,337 232,252,971 76.97 275,703,917 91.37 6.18 % Thereafter 16,801,943 1,444,160,351 85.95 1,726,132,587 102.73 34.39 % _______________ (1) Includes 100% of unconsolidated joint venture properties.
Removed
The aggregate amounts of rent abatements per square foot under existing leases as of December 31, 2023, 2022, 2021, 2020 and 2019 for the succeeding twelve-month period were $2.47, $1.56, $2.15, $1.73 and $1.70, respectively. 52 T able of Contents Top 20 Clients by Square Feet Our 20 largest clients by square feet as of December 31, 2023 were as follows: Client Square Feet (1) % of In-Service Portfolio (1) 1. salesforce.com 891,231 2.10 % 2.
Added
(5) Represents leases that expired on December 31, 2024. (6) Includes 261,046 square feet related to Reston Corporate Center which was taken out of service on January 1, 2025.
Removed
(4) Percentage of Total Square Feet 2023 (5) 160,589 $9,802,660 $61.04 $9,802,660 $61.04 0.33 % 2024 2,676,191 175,925,225 65.74 177,083,389 66.17 5.47 % 2025 3,150,406 240,715,108 76.41 244,631,629 77.65 6.44 % 2026 2,682,236 231,970,206 86.48 236,502,157 88.17 5.48 % 2027 2,445,283 193,144,607 78.99 205,179,627 83.91 5.00 % 2028 3,417,177 279,177,909 81.70 301,397,445 88.20 6.98 % 2029 3,818,976 282,099,562 83.87 318,387,006 83.37 7.80 % 2030 2,925,267 227,515,075 77.78 249,994,406 85.46 5.98 % 2031 2,313,899 194,176,879 83.92 216,462,874 93.55 4.73 % 2032 2,290,559 179,323,608 78.29 209,859,249 91.62 4.68 % Thereafter 16,898,552 1,387,847,687 82.13 1,714,163,976 101.44 34.52 % _______________ (1) Includes 100% of unconsolidated joint venture properties.
Removed
(5) Represents leases that expired on December 31, 2023.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

9 edited+1 added−6 removed5 unchanged
Biggest changePeriod (a) Total Number of Shares of Common Stock Purchased (b) Average Price Paid per Common Share (c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (d) Maximum Number (or Approximate Dollar Value) of Shares that May Yet be Purchased under the Plans or Programs October 1, 2023 – October 31, 2023 — $ — N/A N/A November 1, 2023 – November 30, 2023 — — N/A N/A December 1, 2023 – December 31, 2023 939 (1) 0.01 N/A N/A Total 939 $ 0.01 N/A N/A ____________________ (1) Includes 939 shares of restricted common stock of BXP repurchased in connection with the termination of certain employees’ employment with BXP.
Biggest changePeriod (a) Total Number of Shares of Common Stock Purchased (b) Average Price Paid per Common Share (c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (d) Maximum Number (or Approximate Dollar Value) of Shares that May Yet be Purchased under the Plans or Programs October 1, 2024 – October 31, 2024 — $ — N/A N/A November 1, 2024 – November 30, 2024 35 (1) 80.95 N/A N/A December 1, 2024 – December 31, 2024 — — N/A N/A Total 35 $ 80.95 N/A N/A ____________________ (1) Represents shares of common stock of BXP surrendered by employees to BXP to satisfy such employees’ tax withholding obligations in connection with the vesting of restricted common stock.
BXP has adopted a policy of paying regular quarterly dividends on its common stock, and, as BPLP’s general partner, BXP has adopted a policy of paying regular quarterly distributions on common units of BPLP. Cash distributions have been paid on the common stock of BXP and BPLP’s common units since BXP’s initial public offering.
BXP has adopted a policy of paying regular quarterly dividends on its common stock, and, as BPLP’s general partner, BXP has adopted a policy of paying regular quarterly distributions on common units of BPLP. Cash distributions have been paid on the common stock of BXP and BPLP’s common units since BXP’s initial public offering in 1997.
Stock Performance Graph The following graph provides a comparison of cumulative total stockholder return for the period from December 31, 2018 through December 31, 2023, among BXP, Standard & Poor’s (“S&P”) 500 Index, FTSE Nareit Equity REIT Total Return Index (the “Equity REIT Index”) and the FTSE Nareit Office REIT Index (the “Office REIT Index”).
Stock Performance Graph The following graph provides a comparison of cumulative total stockholder return for the period from December 31, 2019 through December 31, 2024, among BXP, Standard & Poor’s (“S&P”) 500 Index, FTSE Nareit Equity REIT Total Return Index (the “Equity REIT Index”) and the FTSE Nareit Office REIT Index (the “Office REIT Index”).
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. The common stock of Boston Properties, Inc. is listed on the New York Stock Exchange under the symbol “BXP.” At February 20, 2024, BXP had approximately 1,047 stockholders of record. There is no established public trading market for BPLP’s common units.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. The common stock of BXP, Inc. is listed on the New York Stock Exchange under the symbol “BXP.” At February 21, 2025, BXP had approximately 1,009 stockholders of record. There is no established public trading market for BPLP’s common units.
Of these shares, 1,000 shares were issued in reliance on an exemption from registration under Section 4(a)(2) of the Securities Act of 1933, as amended. We relied on the exemption under Section 4(a)(2) based upon factual representations received from the limited partner who received the common shares. (b) Not Applicable. (c) Issuer Purchases of Equity Securities.
Of these shares, 178,705 shares were issued in reliance on an exemption from registration under Section 4(a)(2) of the Securities Act of 1933, as amended. BXP relied on the exemption under Section 4(a)(2) based upon factual representations received from the limited partners who received the common shares. (b) Not Applicable. (c) Issuer Purchases of Equity Securities.
Under the terms of the applicable LTIP unit vesting agreements, such LTIP units were repurchased at a price of $0.25 per unit, which were the amounts originally paid by such employees for such units.
Under the terms of the applicable LTIP unit vesting agreements, such LTIP units were repurchased at a price $0.25 per unit, which was the amount originally paid by such employee for such units. 50 Table of Contents
On February 20, 2024, there were approximately 332 holders of record and 176,206,655 common units outstanding, 157,010,980 of which were held by BXP. To maintain its qualification as a REIT, BXP must make annual distributions to its stockholders of at least 90% of its taxable income (not including net capital gains and with certain other adjustments).
On February 21, 2025, there were approximately 344 holders of record and 176,738,933 common units outstanding, 158,209,602 of which were held by BXP. To maintain its qualification as a REIT, BXP must make annual distributions to its stockholders of at least 90% of its taxable income (not including net capital gains and with certain other adjustments).
(c) Issuer Purchases of Equity Securities. 56 T able of Contents Period (a) Total Number of Units Purchased (b) Average Price Paid per Unit (c) Total Number of Units Purchased as Part of Publicly Announced Plans or Programs (d) Maximum Number (or Approximate Dollar Value) of Units that May Yet be Purchased October 1, 2023 – October 31, 2023 — $ — N/A N/A November 1, 2023 – November 30, 2023 5,914 (1) 0.25 N/A N/A December 1, 2023 – December 31, 2023 939 (2) 0.01 N/A N/A Total 6,853 $ 0.22 N/A N/A ____________________ (1) Represents LTIP units that were repurchased by BPLP in connection with the termination of a certain employee’s employment with BXP.
Period (a) Total Number of Units Purchased (b) Average Price Paid per Unit (c) Total Number of Units Purchased as Part of Publicly Announced Plans or Programs (d) Maximum Number (or Approximate Dollar Value) of Units that May Yet be Purchased October 1, 2024 – October 31, 2024 — $ — N/A N/A November 1, 2024 – November 30, 2024 1,568 (1) 0.25 N/A N/A December 1, 2024 – December 31, 2024 — — N/A N/A Total 1,568 $ 0.25 N/A N/A ____________________ (1) Represents LTIP units that were repurchased by BPLP in connection with the termination of an employee’s employment with BXP.
The data shown is based on the share prices or index values, as applicable, at the end of each month shown. 55 T able of Contents As of the year ended December 31, 2018 2019 2020 2021 2022 2023 Boston Properties, Inc. $ 100.00 $ 126.08 $ 90.33 $ 114.01 $ 70.02 $ 77.60 S&P 500 Index $ 100.00 $ 131.49 $ 155.68 $ 200.37 $ 164.08 $ 207.21 Equity REIT Index $ 100.00 $ 126.00 $ 115.92 $ 166.04 $ 125.58 $ 142.83 Office REIT Index $ 100.00 $ 131.42 $ 107.19 $ 130.77 $ 81.58 $ 83.23 BXP (a) During the three months ended December 31, 2023, BXP issued an aggregate of 2,277 shares of common stock in exchange for 2,277 common units of limited partnership held by certain limited partners of BPLP.
The data shown is based on the share prices or index values, as applicable, at the end of each month shown. 49 Table of Contents As of the year ended December 31, 2019 2020 2021 2022 2023 2024 BXP, Inc. $ 100.00 $ 71.65 $ 90.43 $ 55.54 $ 61.55 $ 69.01 S&P 500 Index $ 100.00 $ 118.40 $ 152.39 $ 124.79 $ 157.59 $ 197.02 Equity REIT Index $ 100.00 $ 92.00 $ 131.78 $ 99.67 $ 113.35 $ 123.25 Office REIT Index $ 100.00 $ 81.56 $ 99.51 $ 62.07 $ 63.34 $ 76.95 BXP (a) During the three months ended December 31, 2024, BXP issued an aggregate of 195,132 shares of common stock in exchange for 195,132 common units of limited partnership held by certain limited partners of BPLP.
Removed
Under the terms of the applicable restricted stock award agreements, the shares were repurchased by BXP at a price of $0.01 per share, which was the amount originally paid by such employees for such shares.
Added
BPLP (a) None. (b) Not Applicable. (c) Issuer Purchases of Equity Securities.
Removed
BPLP (a) Each time BXP issues shares of common stock (other than in exchange for common units when such common units are presented for redemption), it contributes the proceeds of such issuance to BPLP in return for an equivalent number of partnership units with rights and preferences analogous to the shares issued.
Removed
During the three months ended December 31, 2023, in connection with issuances of common stock by BXP pursuant to the Boston Properties, Inc. 2021 Stock Incentive Plan, BPLP issued an aggregate of 348 common units to BXP in exchange for approximately $3.48, the aggregate proceeds of such common stock issuances to BXP.
Removed
Such units were issued in reliance on an exemption from registration under Section 4(a)(2) of the Securities Act of 1933, as amended. (b) Not Applicable.
Removed
(2) Represents common units previously held by BXP that were redeemed in connection with the repurchase of shares of restricted common stock of BXP in connection with the termination of certain employees’ employment with BXP.
Removed
Under the terms of the applicable restricted stock award agreements, such shares were repurchased at a price of $0.01 per share, which were the amounts originally paid by such employees for such shares.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

46 edited+33 added−32 removed11 unchanged
Biggest changeThe evolving operating environment impacts various aspects of our operating activities as: • labor market conditions shift, resulting in increasing employer demands for mandatory in-person workdays; • volatility in the capital markets has led companies to be more reticent in capital outlays, including capital required for leasing new space; • our capital costs have increased due to higher interest rates and credit spreads, and private market debt financing, both for construction and existing assets, is significantly more challenging to arrange; and • construction costs have increased and, although much of the cost for our active development pipeline is fixed, the cost of potential future construction activity continues to increase.
Biggest changeAn area of concern with the new presidential administration's policies is the potential impact to interest rates, given that new tariffs, if implemented, could be inflationary and tax cuts without corresponding spending cuts could lead to longer fiscal deficits and higher long-term treasury yields in the debt markets. 54 Table of Contents The evolving operating environment impacts various aspects of our operating activities as: • labor market conditions shift, which has gradually increased employer demand for mandatory in-person workdays; • private market debt financing, both for construction and existing assets, continues to be challenging to arrange despite broader market improvements as lenders remain focused on top-tier sponsorship and derisked financing opportunities; and • construction costs have increased and, although much of the cost for our active development pipeline is fixed, the cost of potential future construction activity continues to increase.
Investors should also refer to our most recent Quarterly Reports on Form 10-Q for future periods and Current Reports on Form 8-K as we file them with the SEC, and to other materials we may furnish to the public from time to time through Current Reports on Form 8-K or otherwise, for a discussion of risks and uncertainties that may cause actual results, performance or achievements to differ materially from those expressed or implied by forward-looking statements.
Investors should also refer to our Quarterly Reports on Form 10-Q for future periods and Current Reports on Form 8-K as we file them with the SEC, and to other materials we may furnish to the public from time to time through Current Reports on Form 8-K or otherwise, for a discussion of risks and uncertainties that may cause our actual results, performance or achievements to differ materially from those expressed or implied by forward-looking statements.
Accordingly, investors should use caution in relying on forward-looking statements, which are based on results and trends at the time they are made, to anticipate future results or trends.
Accordingly, investors should use caution in relying on forward-looking statements, which are based on results, trends and assumptions at the time they are made, to anticipate future results or trends.
Some of the risks and uncertainties that may cause our actual results, performance or achievements to differ materially from those expressed or implied by forward-looking statements include, among others, the following: • volatile or adverse global economic and geopolitical conditions, health crises and dislocations in the credit markets could adversely affect economic conditions and/or restrict our access to cost-effective capital, which could have a material adverse effect on our business opportunities, results of operations and financial condition; • general risks affecting the real estate industry (including, without limitation, the inability to enter into or renew leases, changes in client preferences and space utilization, dependence on clients’ financial condition, and competition from other developers, owners and operators of real estate); • failure to manage effectively our growth and expansion into new markets and sub-markets or to integrate acquisitions and developments successfully; • the ability of our joint venture partners to satisfy their obligations; • risks and uncertainties affecting property development and construction (including, without limitation, continued inflation, supply chain disruptions, labor shortages, construction delays, increased construction costs, cost overruns, inability to obtain necessary permits, client accounting considerations that may result in negotiated lease provisions that limit a client’s liability during construction, and public opposition to such activities); • risks associated with the availability and terms of financing and the use of debt to fund acquisitions and developments or refinance existing indebtedness, including the impact of higher interest rates on the cost and/or availability of financing; 58 T able of Contents • risks associated with forward interest rate contracts and derivatives and the effectiveness of such arrangements; • risks associated with actual or threatened terrorist attacks; • costs of compliance with the Americans with Disabilities Act and other similar laws; • potential liability for uninsured losses and environmental contamination; • risks associated with climate change and severe weather events, as well as the regulatory efforts intended to reduce the effects of climate change; • risks associated with security breaches, incidents, and compromises through cyber-attacks, cyber intrusions or otherwise, as well as other significant disruptions of our information technology (IT) networks and related systems, which support our operations and our buildings; • risks associated with legal proceedings and other claims that could result in substantial monetary and other costs; • risks associated with BXP’s potential failure to qualify as a REIT under the Internal Revenue Code of 1986, as amended; • possible adverse changes in tax and environmental laws; • the impact of newly adopted accounting principles on our accounting policies and on period-to-period comparisons of financial results; • risks associated with possible state and local tax audits; and • risks associated with our dependence on key personnel whose continued service is not guaranteed.
Some of the risks and uncertainties that may cause our actual results, performance or achievements to differ materially from those expressed or implied by forward-looking statements include, among others, the following: • volatile or adverse global economic and political conditions, health crises and dislocations in the credit markets could adversely affect economic conditions and/or restrict our access to cost-effective capital, which could have a material adverse effect on our business opportunities, results of operations and financial condition; • general risks affecting the real estate industry (including, without limitation, the inability to enter into or renew leases on attractive terms, changes in client preferences and space utilization, dependence on clients’ financial condition, and competition from other developers, owners and operators of real estate); • failure to manage effectively our growth and expansion into new markets and sub-markets or to integrate acquisitions and developments successfully; • the ability of our joint venture partners to satisfy their obligations; • risks and uncertainties affecting property development and construction (including, without limitation, supply chain disruptions, labor shortages, construction delays, increased construction costs, cost overruns, inability to obtain necessary permits, client accounting considerations that may result in negotiated lease provisions that limit a client’s liability during construction, and public opposition to such activities); • risks associated with the availability and terms of financing and the use of debt to fund acquisitions and developments or refinance existing indebtedness, including the impact of higher interest rates on the cost and/or availability of financing; 52 Table of Contents • risks associated with forward interest rate contracts and derivatives and the effectiveness of such arrangements; • risks associated with actual or threatened terrorist attacks; • costs of compliance with the Americans with Disabilities Act and other similar laws; • potential liability for uninsured losses and environmental contamination; • risks associated with climate change and severe weather events, as well as the regulatory efforts intended to reduce the effects of climate change; • risks associated with security breaches, incidents, and compromises through cyber-attacks, cyber intrusions or otherwise, as well as other significant disruptions of our information technology (IT) networks and related systems, which support our operations and our buildings; • risks associated with legal proceedings and other claims that could result in substantial monetary damages and other costs; • risks associated with BXP’s potential failure to qualify as a REIT under the Internal Revenue Code of 1986, as amended; • possible adverse changes in tax and environmental laws; • the impact of newly adopted accounting principles on our accounting policies and on period-to-period comparisons of financial results; • risks associated with possible state and local tax audits; and • risks associated with our dependence on key personnel whose continued service is not guaranteed.
(4) Represents leases executed during the year ended December 31, 2023 for which we either (1) commenced lease revenue recognition in such period or (2) will commence lease revenue recognition in subsequent periods, in accordance with GAAP, and includes leases at properties currently under development.
(4) Represents leases executed during the year ended December 31, 2024 for which we either (1) commenced lease revenue recognition in such period or (2) will commence lease revenue recognition in subsequent periods, in accordance with GAAP, and includes leases at properties currently under development.
Investment Activity We continually evaluate current and prospective markets for possible acquisitions of “value-add” assets that require lease-up or repositioning, and acquisitions that are otherwise consistent with our long-term strategy of owning, managing, developing, and improving premier workplaces in each of our chosen markets.
We continually evaluate current and prospective markets for possible acquisitions of “value-add” assets that require lease-up or repositioning, and acquisitions that are otherwise consistent with our long-term strategy of owning, managing, developing, and improving premier workplaces in each of our chosen markets.
If one or more of these known or unknown risks or uncertainties materialize, or if underlying assumptions prove incorrect, actual results may vary materially from those expressed or implied by the forward-looking statements.
If one or more of these known or unknown risks or uncertainties materialize, or if underlying assumptions prove incorrect, actual results may differ materially from those expressed or implied by the forward-looking statements.
Forward-Looking Statements This Annual Report on Form 10-K, including the documents incorporated by reference, contain forward-looking statements within the meaning of the federal securities laws, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.
Forward Looking Statements This Annual Report on Form 10-K, including the documents incorporated by reference herein, contain forward-looking statements within the meaning of the federal securities laws, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
In light of the uncertain trajectory of the U.S. and global economies, we believe we continue to position BXP for success by increasing liquidity, managing our leverage, pursuing additional capital raising opportunities and maintaining discipline in discretionary capital expenditures, while continuing to selectively invest (including through both acquisitions and developments) in premier workplace opportunities.
In light of the uncertain trajectory of the U.S. and global economies, we continue to position BXP for success by ensuring ample liquidity, managing our leverage, pursuing additional capital raising opportunities and maintaining discipline in discretionary capital expenditures, while continuing to selectively invest (including through both acquisitions and developments) in premier workplace opportunities.
(7) Represents the increase in gross rent (base rent plus expense reimbursements) on the new versus expired leases on the 2,442,828 square feet of second generation leases that had been occupied within the prior 12 months for the year ended December 31, 2023; excludes leases that management considers temporary because the client is not expected to occupy the space on a long-term basis.
(7) Represents the increase in gross rent (base rent plus expense reimbursements) on the new versus expired leases on the 2,820,354 square feet of second generation leases that had been occupied within the prior 12 months for the year ended December 31, 2024; excludes leases that management considers temporary because the client is not expected to occupy the space on a long-term basis.
When making leasing decisions, we consider, among other things, the creditworthiness of the client and the industry in which it conducts business, the length of the lease, the rental rate to be paid at inception and throughout the lease term, the amount of any security deposit or letter of credit posted by the client, the costs of tenant improvements, free rent periods and other landlord concessions, anticipated operating expenses and real estate taxes, current and anticipated vacancy in our properties and the market overall (including sublease space), current and expected future demand for the space, the impact of other clients’ expansion rights, and general economic factors.
When making leasing decisions, we consider, among other things, the creditworthiness of the client and the industry in which it conducts business, the length of the lease, the rental rate to be paid at inception and throughout the lease term, the amount of any security deposit or letter of credit posted by the client, the costs of tenant improvement allowances, free rent periods and other landlord concessions, anticipated operating expenses and real estate taxes, the date by which we expect to begin revenue recognition for the lease under GAAP, current and anticipated vacancy in our properties and the market overall (including sublease space), current and expected future demand for the space, the impact of other clients’ expansion rights and general economic factors.
(8) Represents the increase in net rent (gross rent less operating expenses) on the new versus expired leases on the 2,442,828 square feet of second generation leases that had been occupied within the prior 12 months for the year ended December 31, 2023. For descriptions of significant transactions that we completed during 2023, see “
(8) Represents the increase in net rent (gross rent less operating expenses) on the new versus expired leases on the 2,820,354 square feet of second generation leases that had been occupied within the prior 12 months for the year ended December 31, 2024. For descriptions of significant transactions that we completed during 2024, see “
In this regard, we believe we have a competitive leasing advantage that results from: • our understanding of our client’s short- and long-term space utilization and amenity needs in the local markets; • our track record of developing and operating premier workplaces in a sustainable and responsible manner; • our reputation as a high-quality developer, owner and manager of premier workplaces in our markets; • our financial strength, including our ability to fund our share of lease obligations and maintain premier building standards; and • our relationships with local brokers.
In this regard, we believe that our competitive leasing advantage is based on the following attributes: • our understanding of our client’s short- and long-term space utilization and amenity needs in the local markets; • our track record of developing and operating premier workplaces in a sustainable and responsible manner; • our reputation as a high-quality developer, owner and manager of premier workplaces in our markets; • our financial strength, including our ability to fund our share of lease obligations and maintain premier building standards; and • our relationships with local brokers.
As of December 31, 2023, our development/redevelopment pipeline consisted of 10 properties that, when completed, we expect will total approximately 2.7 million net rentable square feet. Our share of the estimated total cost for these projects is approximately $2.4 billion, of which approximately $1.3 billion remains to be invested.
As of December 31, 2024, our development/redevelopment pipeline consisted of seven properties that, when completed, we expect will total approximately 2.3 million net rentable square feet. Our share of the estimated total cost for these projects is approximately $2.3 billion, of which approximately $1.3 billion remains to be invested.
Approximately 98,000 square feet of leases that commenced revenue recognition had been vacant for less than one year and represent a decrease in net rental obligations of approximately 3.5% over the prior leases.
Approximately 146,000 square feet of the leases that commenced had been vacant for less than one year and represent a decrease in net rental obligations of approximately 0.3% over the prior leases.
The most significant factors that may cause actual results to differ materially from those expressed or implied by the forward-looking statements include the risks and uncertainties related to the impact of changes in general economic and capital market conditions, including continued inflation, increasing interest rates, supply chain disruptions, labor market disruptions, dislocation and volatility in capital markets, and potential longer-term changes in consumer and client behavior resulting from the severity and duration of any downturn in the U.S. or global economy, sustained changes in client preferences and space utilization, as well as the other important factors below and the risks set forth in this Form 10-K in Part I, Item 1A.
The most significant factors that may cause actual results to differ materially from those expressed or implied by the forward-looking statements include the risks and uncertainties related to adverse changes in general economic and capital market conditions, including inflation, increases in interest rates, supply chain disruptions, labor market disruptions, dislocation and volatility in capital markets, and potential longer-term changes in consumer and client behavior, sustained changes in client preferences and space utilization, as well as the other important factors below and the risks set forth in this Form 10-K in Part I, Item 1A.
A significant component of our Washington, DC regional portfolio is in Reston Town Center, an award-winning mixed-use development in Northern Virginia comprised of approximately 4.9 million square feet. Reston is a hub for technology, cloud services, cybersecurity and defense intelligence companies.
A significant component of our Washington, DC regional portfolio is in Reston Town Center, an award-winning mixed-use development in Northern Virginia. Reston is a hub for technology, cloud services, cybersecurity and defense intelligence companies.
As of December 31, 2023, the weighted-average remaining lease term based on square feet (1) for our in-place leases, including those signed by our unconsolidated joint 59 T able of Contents ventures but excluding residential units, was approximately 7.8 years, and (2) for our 20 largest clients was approximately 10.7 years.
As of December 31, 2024, the weighted-average remaining lease term for (1) our in-place leases, based on square feet, including those signed by our unconsolidated joint ventures but excluding residential units, was approximately 7.8 years, and (2) our 20 largest clients, based on square feet, was approximately 9.4 years.
Of the 3,674,417 square feet of second generation leases that commenced during the year ended December 31, 2023, leases for 3,117,737 square feet were signed in prior periods. (6) Total transaction costs include tenant improvements and leasing commissions but exclude free rent concessions and other inducements in accordance with GAAP.
Of the 4,022,122 square feet of second generation leases that commenced during the year ended December 31, 2024, leases for 3,105,337 square feet were signed in prior periods. (6) Total transaction costs include tenant improvements and leasing commissions but exclude free rent concessions and other inducements in accordance with GAAP.
Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results.
Given these risks and uncertainties, investors should not unduly rely on forward-looking statements as a prediction of actual results.
Approximately 130,000 square feet of the leases that commenced revenue recognition had been vacant for less than one year and they represent a decrease in net rental obligations of approximately 15.4% over the prior leases.
Approximately 199,000 square feet of the leases that commenced had been vacant for less than one year, and they represent a decrease in net rental obligations of approximately 5.9% over the prior leases.
As of December 31, 2023, our New York CBD in-service portfolio was approximately 91.8% occupied and approximately 94.4% leased (including vacant space for which we have signed leases that have not yet commenced revenue recognition in accordance with GAAP).
As of December 31, 2024, our New York CBD in-service portfolio was approximately 90.8% occupied and approximately 93.6% leased (including vacant space for which we have signed leases that have not yet commenced in accordance with GAAP).
As of December 31, 2023, our LA in-service properties were approximately 85.9% occupied and 88.1% leased (including vacant space for which we have signed leases that have not yet commenced revenue recognition in accordance with GAAP).
As of December 31, 2024, our LA in-service properties were approximately 84.9% occupied and 87.4% leased (including vacant space for which we have signed leases that have not yet commenced in accordance with GAAP).
The total square feet of leases e xecuted and recognized during the year ended December 31, 2023 is 600,807 square feet. 64 T able of Contents (5) Second generation leases are defined as leases for space that we have previously leased.
The total square feet of leases e xecuted and recognized during the year ended December 31, 2024 is 943,147 square feet. (5) Second generation leases are defined as leases for space that we have previously leased.
We define occupancy as space with signed leases for which revenue recognition has commenced in accordance with GAAP. Including vacant space for which we have signed leases that have not yet commenced revenue recognition in accordance with GAAP, our in-service premier workplace and retail properties were approximately 89.9% leased at December 31, 2023.
Including vacant space for which we have signed leases that have not yet commenced revenue recognition in accordance with GAAP, our in-service office and retail properties were approximately 89.4% leased at December 31, 2024.
As of December 31, 2023, our San Francisco CBD in-service properties were approximately 87.4% occupied and approximately 88.0% leased (including vacant space for which we have signed leases that have not yet commenced revenue recognition in accordance with GAAP).
As of December 31, 2024, our San Francisco CBD in-service properties were approximately 84.3% occupied and approximately 85.2% leased (including vacant space for which we have signed leases that have not yet commenced in accordance with GAAP).
Our Route 128-Mass Turnpike in-service portfolio is comprised of approximately 4.9 million square feet and, as of December 31, 2023, was approximately 76.6% occupied and approximately 76.7% leased (including vacant space for which we have signed leases that have not yet commenced revenue recognition in accordance with GAAP).
As of December 31, 2024, our approximately 4.8 millions square foot Route 128-Mass Turnpike in-service portfolio was approximately 75.6% occupied and approximately 77.7% leased (including vacant space for which we have signed leases that have not yet commenced in accordance with GAAP).
New York During the fourth quarter of 2023, we executed approximately 567,000 square feet of leases in the New York region and approximately 143,000 square feet of leases commenced revenue recognition.
New York During the fourth quarter of 2024, we executed approximately 574,000 square feet of leases in the New York region and approximately 575,000 square feet of leases commenced.
As of December 31, 2023, our approximately 8.3 million square foot Boston CBD in-service portfolio was approximately 95.5% occupied and approximately 96.1% leased (including vacant space for which we have signed leases that have not yet commenced revenue recognition in accordance with GAAP). 62 T able of Contents Our approximately 2.5 million square foot in-service premier workplace portfolio in Cambridge was approximately 97.2% occupied and leased (including vacant space for which we have signed leases that have not yet commenced revenue recognition in accordance with GAAP) as of December 31, 2023.
As of December 31, 2024, our approximately 8.4 million square foot Boston CBD in-service portfolio was approximately 95.6% occupied and approximately 97.5% leased (including vacant space for which we have signed leases that have not yet commenced in accordance with GAAP).
Washington, DC During the fourth quarter of 2023, we executed approximately 141,000 square feet of leases and approximately 344,000 square feet of leases commenced revenue recognition in the Washington, DC region.
Washington, DC During the fourth quarter of 2024, we executed leases for approximately 494,000 square feet and leases for approximately 140,000 square feet commenced in the Washington, DC region.
Seattle Our Seattle in-service portfolio includes Safeco Plaza, an approximately 780,000 square foot property of which we own 33.67%, and Madison Centre, an approximately 755,000 square foot property. During the fourth quarter of 2023, approximately 123,000 square feet of leases commenced revenue recognition in the Seattle region.
Seattle Our Seattle in-service portfolio includes Safeco Plaza, an approximately 762,000 square foot property of which we own 33.67%, and Madison Centre, an approximately 755,000 square foot property.
As of December 31, 2023, our Seattle in-service properties were approximately 81.8% occupied and approximately 83.1% leased (inclusive of vacant space with signed leases that have not yet commenced revenue recognition in accordance with GAAP).
As of December 31, 2024, these in-service properties were approximately 81.6% occupied and approximately 83.5% leased (including vacant space for which we have signed leases that have not yet commenced in accordance with GAAP).
As we continue to focus on new investments to drive future growth, we regularly review our portfolio to identify properties as potential sales candidates that either no longer fit within our portfolio strategy or could attract premium pricing in the current market, as evidenced by the partial interest sale of 300 Binney Street during the fourth quarter of 2023 and anticipated partial interest sale of 290 Binney Street.
This project is 100% leased to the Broad Institute. As we continue to focus on new investments to drive future growth, we regularly review our portfolio to identify properties as potential sales candidates that either no longer fit within our portfolio strategy or could attract premium pricing in the current market.
Approximately 159,000 square feet of the leases that commenced revenue recognition had been vacant for less than one year and represent an increase in net rental obligations of approximately 30.4% over the prior leases.
San Francisco During the fourth quarter of 2024, we executed leases for approximately 383,000 square feet and approximately 106,000 square feet commenced in the San Francisco region. Approximately 56,000 square feet of leases that commenced had been vacant for less than one year and represent an increase in net rental obligations of approximately 13.2% over the prior leases.
Overview BXP is one of the largest publicly traded office real estate investment trusts (REITs) (based on total market capitalization as of December 31, 2023) in the U.S. that develops, owns, and manages primarily premier workplaces. Our properties are concentrated in six dynamic gateway markets in the U.S. - Boston, Los Angeles, New York, San Francisco, Seattle, and Washington, DC.
Overview BXP is one of the largest publicly traded office real estate investment trusts (REITs) (based on total market capitalization as of December 31, 2024) in the United States that develops, owns, and manages primarily premier workplaces.
To be successful in any leasing environment, we believe we must consider all aspects of the client-landlord relationship.
The following is an overview of leasing and investment activity in the fourth quarter of 2024 and recent business highlights. Leasing Activity and Occupancy To be successful in any leasing environment, we believe we must consider all aspects of the client-landlord relationship.
As of December 31, 2023, our Reston, Virginia properties were approximately 92.4% occupied and approximately 94.4% leased (inclusive of vacant space with signed leases that have not yet commenced revenue recognition in accordance with GAAP).
As of December 31, 2024, our approximately 4.9 million square foot Reston CBD portfolio was approximately 94.9% occupied and approximately 96.9% leased (including vacant space for which have signed leases that have not yet commenced in accordance with GAAP).
Premier workplaces, the preferred choice for our current and prospective clients, are gaining market share compared to general office space and continue to demonstrate the highest occupancy, net absorption levels and rental rates in the central business districts (“CBDs”) in markets where we operate; • leasing available space in our in-service and development properties, as well as proactively focusing on future lease expirations; • completing the construction and leasing of our development properties; • pursuing attractive asset class adjacencies where we have a track record of success, such as life sciences and residential development; • continuing to raise the bar in the quality of our portfolio and actively recycling capital by selling assets, subject to market conditions, which have been, and may continue to be, negatively impacted by a slowdown in the capital markets and the limited availability of private market debt financing; • actively managing our operations in a sustainable and responsible manner; and • prioritizing risk management by actively managing liquidity, investing more extensively with joint venture partners to manage our debt levels, and being highly selective in new investment commitments.
We remain focused on: • continuing to embrace our leadership position in the premier workplace segment and leveraging our strength in portfolio quality, client relationships, development skills, market penetration and sustainability to profitably build market share; • leasing available space in our in-service and development properties, as well as proactively focusing on future lease expirations; • completing the construction and leasing of our development properties; • pursuing attractive asset class adjacencies where we have a track record of success, such as residential development; • continuing to enhance the overall quality of our portfolio and actively recycling capital by selling assets, subject to market conditions, that we believe no longer fit within our portfolio strategy or could attract premium pricing in the current market; • actively managing our operations in a sustainable and responsible manner; and • prioritizing risk management by actively managing liquidity, investing more extensively with joint venture partners to manage our debt levels, and being highly selective in new investment commitments.
We expect to see more opportunities to make investments in this environment, and we remain committed to developing and acquiring assets to enhance our long-term growth and to meet current and future client demand for premier workplaces, life sciences, and residential development.
Additional new acquisition opportunities will likely increase in this environment, and we remain committed to developing and acquiring assets to enhance our long-term growth and to meet client demand by focusing on premier workplaces.
As of December 31, 2023, our Washington, DC CBD in-service properties were approximately 83.2% occupied and approximately 89.1% leased (inclusive of vacant space with signed leases that have not yet commenced revenue recognition in accordance with GAAP).
Our approximately 2.7 million square foot in-service CBD portfolio in Cambridge was approximately 96.6% occupied and 97.6% leased (including vacant space for which we have signed leases that have not yet commenced in accordance with GAAP) as of December 31, 2024.
Boston During the fourth quarter of 2023, we executed approximately 153,000 square feet of leases and approximately 393,000 square feet of leases commenced revenue recognition in the Boston region.
A brief overview of each of our markets follows. 56 Table of Contents Boston During the fourth quarter of 2024, we executed approximately 682,000 square feet of leases and approximately 430,000 square feet of leases commenced in the Boston region.
Leasing Statistics The table below details the leasing activity, including 100% of the unconsolidated joint ventures, that commenced revenue recognition during the year ended December 31, 2023: Year ended December 31, 2023 (Square Feet) Vacant space available at the beginning of the period 5,610,777 Property dispositions/properties taken out of service (1) (645,154) Properties placed (and partially placed) in-service (2) 668,672 Leases expiring or terminated during the period 4,620,806 Total space available for lease 10,255,101 1 st generation leases 884,677 2 nd generation leases with new clients 2,106,810 2 nd generation lease renewals 1,567,607 Total space leased (3) 4,559,094 Vacant space available for lease at the end of the period 5,696,007 Leases executed during the period, in square feet (4) 4,181,399 Second generation leasing information : (5) Leases commencing during the period, in square feet 3,674,417 Weighted Average Lease Term 89 Months Weighted Average Free Rent Period 182 Days Total Transaction Costs Per Square Foot (6) $77.72 Increase in Gross Rents (7) 0.46 % Increase in Net Rents (8) 0.48 % __________________ (1) Total vacant square feet of properties taken out of service and property dispositions during the year ended December 31, 2023 consists of 289,204 square feet at Metropolitan Square (See Note 6 to the Consolidated Financial Statements), 195,191 square feet at 300 Binney Street, 55,852 square feet at 420 Bedford Street, 57,045 square feet at 430 Bedford Street, 25,189 square feet at 2098 Gaither Road and 22,673 square feet at 2092 Gaither Road.
Leasing Statistics The table below details our vacancy and the leasing activity, including 100% of the unconsolidated joint ventures, that commenced revenue recognition during the year ended December 31, 2024: Year ended December 31, 2024 (Square Feet) Vacant space available at the beginning of the period 5,696,007 Vacant space from property dispositions/properties taken out of service (1) (580,232) Vacant space from properties placed (and partially placed) in-service (2) 831,121 Leases expiring or terminated during the period 4,952,232 Total space available for lease 10,899,128 1 st generation leases 754,932 2 nd generation leases with new clients 1,965,698 2 nd generation lease renewals 2,056,424 Total space leased (3) 4,777,054 Vacant space available for lease at the end of the period 6,122,074 Leases executed during the period (4) 5,648,615 Second generation leasing information : (5) Leases commencing during the period, in square feet 4,022,122 Weighted Average Lease Term 89 Months Weighted Average Free Rent Period 140 Days Total Transaction Costs Per Square Foot (6) $79.32 Increase in Gross Rents (7) 1.38 % Increase in Net Rents (8) 1.79 % __________________ (1) Total square feet from properties taken out of service during the year ended December 31, 2024 consists of 205,355 square feet at 1100 Winter Street, 162,274 square feet at 1050 Winter Street, 111,183 square feet at Kingstowne One, 71,420 square feet at 15825 Shady Grove Road and 30,000 square feet at 17 Hartwell Avenue.
Approximately 99,000 square feet of the leases that commenced revenue recognition had been vacant for less than one year and represent a decrease in net rental obligations of approximately 13.1% over the prior leases.
Leases for approximately 64,000 square feet that commenced had been vacant for less than one year and represent a decrease in net rental obligations of approximately 11.6% over the prior leases. 57 Table of Contents As of December 31, 2024, our Washington, DC CBD in-service properties were approximately 89.2% occupied and approximately 90.7% leased (including vacant space for which we have signed leases that have not yet commenced in accordance with GAAP).
BPLP is the entity through which BXP conducts substantially all of its business and owns (either directly or through subsidiaries) substantially all of its assets. We generate revenue and cash primarily by leasing premier workplaces to our clients.
We generate revenue and cash primarily by leasing premier workplaces to our clients.
Our leasing, construction and property management teams will lean on our operating prowess to gain new clients and market share as clients choose premier workplaces that are in sound financial condition for their office space.
As clients choose premier workplaces in sound financial condition, with building owners that are committed for the long term to their properties operated by the best property management teams, we expect to continue to be successful in gaining market share.
Potential clients touring space acknowledge that economic uncertainty is impacting space decisions. In the fourth quarter of 2023, we signed more than 1.5 million square feet of leases with a weighted-average lease term of approximately 8.4 years, for a total of approximately 4.2 million square feet leased in 2023 with a weighted-average lease term of 8.2 years.
In the fourth quarter of 2024, we executed 83 leases totaling more than 2.3 million square feet with a weighted-average lease term of approximately 10.3 years. This result represents BXP’s strongest leasing quarter since the second quarter of 2019, and the amount leased is approximately 130% of our historical 10-year average for the 55 Table of Contents fourth quarter.
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Outlook The U.S. economy continued to grow during the fourth quarter of 2023, with the Gross Domestic Product growing at a 3.3% annual rate in the fourth quarter.
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Our properties are concentrated in six dynamic gateway markets in the U.S. - Boston, Los Angeles, New York, San Francisco, Seattle and Washington, DC. BPLP is the entity through which BXP conducts substantially all of its business and owns (either directly or through subsidiaries) substantially all of its assets.
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While the year also ended with continued low unemployment and cooling inflation, the economic statistics may not accurately reflect the market sentiment and operating environment facing many of our clients, as well as BXP, as we look ahead to 2024 and beyond.
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We believe our key competitive advantages are our commitment to the office asset class and to our clients as many competitors have divested in the sector, a strong balance sheet with access to capital in the secured and unsecured debt markets and the private and public equity markets, and one of the highest quality portfolios of 53 Table of Contents premier workplaces in the U.S. assembled over several decades of intentional development, acquisitions and dispositions.
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In 2023, the U.S. office markets experienced overall negative leasing absorption, including in all of our coastal markets, as well as the major Sunbelt and Midwest markets.
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Clients and their advisors are increasingly focused on these attributes for their building owners, which distinguishes BXP among its competitors.
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According to recent labor statistics, the U.S. added 333,000 jobs in December, however, only approximately 8% of those jobs were categorized as professional and business services, which are drivers of demand for premier workplace space.
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We consider premier workplaces to be well-located buildings that are modern structures or have been modernized to compete with newer buildings, are professionally managed and maintained, and offer a number and type of amenities that are in high demand by clients that are focused on the importance of the physical work environment in recruiting and retaining the best and brightest employees.
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Despite the slowed pace of job reductions from this time last year, we continue to see employee layoff announcements across a wide variety of industries, particularly technology.
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As such, these properties attract creditworthy clients and command upper-tier rental rates in their markets. We do not consider the expression “premier workplaces” a classification of our properties in accordance with any standard listing criteria in the real estate industry.
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As a result, although the U.S. economy may not enter a technical recession, we do not expect that a soft landing will stimulate an increase in office-using employment or in leasing absorption in 2024.
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We therefore caution investors that our use and definition of “premier workplaces” may be different than the use and definition of similar expressions and traditional classifications that may be used by other companies.
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Remote work continues to be a factor restraining demand for office space, though we believe macroeconomic conditions are the primary driver of leasing activity and that our leasing, in particular, is driven by corporate earnings growth.
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We believe this strategy provides a competitive advantage that helps BXP distinguish itself from competitors as our clients are interested in leasing space in vibrant, amenitized and accessible premier workplaces to encourage more in-person work. This interest has accelerated the flight to quality in the office industry.
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The S&P 500’s trailing 10-year average annual earnings growth rate from 2013-2022 was 8.4%, as compared to 2023 where, earnings growth is projected to be less than 1%. S&P 500 companies are expected to increase earnings by over 9% in 2024.
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Over the past several years, BXP’s experience and performance has diverged from the larger market and media sentiment, as premier workplaces have outperformed the broader office market consistently and substantially in both rental rates achieved and occupancy. We believe this divergence validates our strategy and differentiates BXP from other office companies.
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As overall earnings growth for our clients and potential clients improves, it should lead to employment growth and demand for office space over time. However, we are not counting on a near-term market recovery to maintain our occupancy.
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Premier workplaces in our five traditional central business district (“CBD”) markets (Boston, New York, San Francisco, Seattle and Washington, DC) have consistently outperformed the broader office market in those CBDs on several key metrics, including occupancy, net absorption levels, rental rates and landlord concessions.
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We remain focused on the following strategies: 60 T able of Contents • continuing to embrace our leadership position in the premier workplace segment and leveraging our strength in portfolio quality, client relationships, development skills, market penetration and sustainability to profitably build market share.
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This outperformance is evident in BXP’s portfolio where we derive approximately 88% of our share of annualized rental obligations from predominantly premier workplaces located in CBDs. We define annualized rental obligations as the monthly contractual base rent (excluding percentage rent and rent abatements) and budgeted reimbursements from clients under existing leases as of December 31, 2024, multiplied by twelve.
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The following is an overview of leasing and investment activity in the fourth quarter of 2023 and recent business highlights. Leasing Activity and Occupancy The macroeconomic environment has resulted in softening demand in all of our markets. While property tours continue and lease negotiations move forward, there is less urgency from clients to make new commitments.
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Our share of annualized rental obligations is calculated as the consolidated amount, plus our share of the amount from our unconsolidated joint ventures (calculated based on our economic percentage ownership interest), less our partners’ share of the amount from our consolidated joint ventures (calculated based on the partners’ economic percentage ownership interest).
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This is the third consecutive quarter that leasing has increased, underscoring the demand for premier workplaces despite the challenging market. The overall occupancy of our in-service premier workplace and retail properties was 88.4% at December 31, 2023, a decrease of 40 basis points from September 30, 2023.
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As of December 31, 2024, these CBD assets are 90.9% occupied and 92.8% leased (including vacant space for which we have signed leases that have not yet commenced in accordance with generally accepted accounting principles (“GAAP”)).
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Consistent with this strategy, we purchased our partners’ interests in three assets from two different joint venture partners, one of which closed in early January 2024. • We completed the acquisition of our joint venture partner’s 45% ownership interest in Santa Monica Business Park located in Santa Monica, California.
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Outlook The important market forces impacting BXP continue to be corporate earnings growth, return-to-office behavior, limited new development starts and the outperformance of premier workplaces, all of which are currently serving as tailwinds to BXP’s performance. Interest rates also remain a critical factor but are on a more uncertain trajectory.
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The acquisition was completed for a gross purchase price of $38.0 million, and we acquired net working capital, including cash and cash equivalents of approximately $20 million, as well as the partner’s share of the outstanding $300.0 million mortgage debt. Subsequent to closing, we extended an approximately 467,000 square foot lease with anchor client, Snap Inc. through 2036.
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Inflation rose in the last three months of 2024 to 2.9%, remaining above the Federal Reserve’s 2% target, and the December 2024 employment data indicated new job creation exceeded market expectations. As a result, the Federal Reserve has become more cautious, lowering its forecast of Federal funds rate cuts in 2025.
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Santa Monica Business Park is a 47-acre office park consisting of 21 buildings and totaling approximately 1.2 million net rentable square feet. Approximately 70% of the square footage is subject to a ground lease having a remaining term of approximately 75 years, inclusive of renewal options 61 T able of Contents that are subject to certain conditions.
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In the fixed income markets, long-term interest rates have increased approximately 100 basis points since the Federal Reserve's first rate cut in September 2024. Notwithstanding these uncertainties, we expect short-term interest rates to remain lower in 2025 compared to 2024, which would be a positive for both BXP and our clients' cost of capital.
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Under the ground lease, we have a purchase option at fair market value in 2028 (See Notes 3, 4, and 7 to the Consolidated Financial Statements). • We completed the acquisition of one of our joint venture partner’s approximate 29% ownership interest in 360 Park Avenue South located in New York City, New York for a purchase price of $1.
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Though we are in the early stages of the new presidential administration, we believe many of the initial articulated policies are generally business friendly, particularly lower taxes and less regulation, which could build the confidence of our clients and, as a result, potentially stimulate leasing activities.
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We now own approximately 71% of the joint venture.
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Overall, we believe that our operating environment is improving. Although all the markets in which we operate still need consistent incremental absorption to constitute a macro recovery, we have started to see pockets of strength where low availability is driving constructive client behavior, particularly in New York and Boston which accounts for 61% of our share of annualized rental obligations.

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