Segment Information

9 Months Ended

Sep. 30, 2011

Segment Information [Abstract]

Segment Information

12. Segment Information

The Company's segments are based on the Company's method of internal reporting which classifies its operations by both geographic area and property type. The Company's segments by geographic area are Greater Boston, Greater Washington, DC, Midtown Manhattan, Greater San Francisco and New Jersey. Segments by property type include: Class A Office, Office/Technical, Residential and Hotels.

Asset information by segment is not reported because the Company does not use this measure to assess performance. Therefore, depreciation and amortization expense is not allocated among segments. Interest and other income, development and management services, general and administrative expenses, acquisition costs, interest expense, depreciation and amortization expense, suspension of development, gains (losses) from investments in securities, losses from early extinguishments of debt, income from unconsolidated joint ventures, gain on sale of real estate and noncontrolling interests are not included in Net Operating Income as internal reporting addresses these items on a corporate level.

Net Operating Income is not a measure of operating results or cash flows from operating activities as measured by accounting principles generally accepted in the United States of America, and it is not indicative of cash available to fund cash needs and should not be considered an alternative to cash flows as a measure of liquidity. All companies may not calculate Net Operating Income in the same manner. The Company considers Net Operating Income to be an appropriate supplemental measure to net income because it helps both investors and management to understand the core operations of the Company's properties.

Information by geographic area and property type:

Three months ended September 30, 2011 (dollars in thousands):

	Greater Boston			Greater Washington, DC			Midtown Manhattan			Greater San Francisco			New Jersey			Total
Rental Revenue:
Class A	$	141,680		$	95,192		$	115,284		$	53,978		$	15,495		$	421,629
Office/Technical		7,871			4,235			—			—			—			12,106
Residential		284			2,169			—			—			—			2,453
Hotel		8,045			—			—			—			—			8,045
Total		157,880			101,596			115,284			53,978			15,495			444,233
% of Total		35.54	%		22.87	%		25.95	%		12.15	%		3.49	%		100.00	%
Real Estate Operating Expenses:
Class A		55,614			26,036			39,331			20,788			7,189			148,958
Office/Technical		2,501			1,108			—			—			—			3,609
Residential		270			2,148			—			—			—			2,418
Hotel		6,032			—			—			—			—			6,032
Total		64,417			29,292			39,331			20,788			7,189			161,017
% of Total		40.01	%		18.19	%		24.43	%		12.91	%		4.46	%		100.00	%
Net Operating Income	$	93,463		$	72,304		$	75,953		$	33,190		$	8,306		$	283,216
% of Total		33.00	%		25.53	%		26.82	%		11.72	%		2.93	%		100.00	%

Three months ended September 30, 2010 (dollars in thousands):

	Greater Boston			Greater Washington, DC			Midtown Manhattan			Greater San Francisco			New Jersey			Total
Rental Revenue:
Class A	$	94,016		$	84,708		$	111,383		$	54,268		$	16,041		$	360,416
Office/Technical		7,627			3,912			—			—			—			11,539
Residential		—			—			—			—			—			—
Hotel		8,016			—			—			—			—			8,016
Total		109,659			88,620			111,383			54,268			16,041			379,971
% of Total		28.86	%		23.32	%		29.32	%		14.28	%		4.22	%		100.00	%
Real Estate Operating Expenses:
Class A		36,082			24,243			35,908			20,317			8,081			124,631
Office/Technical		2,417			993			—			—			—			3,410
Residential		—			—			—			—			—			—
Hotel		6,194			—			—			—			—			6,194
Total		44,693			25,236			35,908			20,317			8,081			134,235
% of Total		33.29	%		18.80	%		26.75	%		15.14	%		6.02	%		100.00	%
Net Operating Income	$	64,966		$	63,384		$	75,475		$	33,951		$	7,960		$	245,736
% of Total		26.44	%		25.79	%		30.71	%		13.82	%		3.24	%		100.00	%

Nine months ended September 30, 2011 (dollars in thousands):

	Greater Boston			Greater Washington, DC			Midtown Manhattan			Greater San Francisco			New Jersey			Total
Rental Revenue:
Class A	$	405,234		$	265,286		$	341,698		$	161,039		$	47,585		$	1,220,842
Office/Technical		23,088			12,177			—			—			—			35,265
Residential		284			2,745			—			—			—			3,029
Hotel		22,897			—			—			—			—			22,897
Total		451,503			280,208			341,698			161,039			47,585			1,282,033
% of Total		35.22	%		21.86	%		26.65	%		12.56	%		3.71	%		100.00	%
Real Estate Operating Expenses:
Class A		154,580			74,221			114,423			60,241			22,591			426,056
Office/Technical		7,392			3,242			—			—			—			10,634
Residential		270			2,871			—			—			—			3,141
Hotel		18,052			—			—			—			—			18,052
Total		180,294			80,334			114,423			60,241			22,591			457,883
% of Total		39.38	%		17.54	%		24.99	%		13.16	%		4.93	%		100.00	%
Net Operating Income	$	271,209		$	199,874		$	227,275		$	100,798		$	24,994		$	824,150
% of Total		32.91	%		24.25	%		27.58	%		12.23	%		3.03	%		100.00	%

Nine months ended September 30, 2010 (dollars in thousands):

	Greater Boston			Greater Washington,  DC			Midtown Manhattan			Greater San Francisco			New Jersey			Total
Rental Revenue:
Class A	$	273,702		$	251,126		$	332,301		$	160,899		$	49,046		$	1,067,074
Office/Technical		22,808			11,883			—			—			—			34,691
Residential		—			—			—			—			—			—
Hotel		22,290			—			—			—			—			22,290
Total		318,800			263,009			332,301			160,899			49,046			1,124,055
% of Total		28.36	%		23.40	%		29.56	%		14.32	%		4.36	%		100.00	%
Real Estate Operating Expenses:
Class A		103,481			69,968			110,177			59,047			23,710			366,383
Office/Technical		6,790			3,137			—			—			—			9,927
Residential		—			—			—			—			—			—
Hotel		17,551			—			—			—			—			17,551
Total		127,822			73,105			110,177			59,047			23,710			393,861
% of Total		32.46	%		18.56	%		27.97	%		14.99	%		6.02	%		100.00	%
Net Operating Income	$	190,978		$	189,904		$	222,124		$	101,852		$	25,336		$	730,194
% of Total		26.15	%		26.01	%		30.42	%		13.95	%		3.47	%		100.00	%

The following is a reconciliation of Net Operating Income to net income attributable to Boston Properties, Inc.:

	Three months ended September 30,					Nine months ended September 30,
	2011		2010			2011		2010
Net Operating Income	$	283,216	$	245,736		$	824,150	$	730,194
Add:
Development and management services income		8,180		6,439			24,706		34,267
Income from unconsolidated joint ventures		11,326		11,565			28,184		26,940
Interest and other income		1,252		1,814			4,179		5,641
Gains on sales of real estate		—		—			—		2,734
Less:
General and administrative expense		17,340		18,067			62,052		62,537
Acquisition costs		51		1,893			136		1,893
Suspension of development		—		—			—		(7,200	)
Depreciation and amortization expense		109,495		81,133			330,003		245,608
Losses (gains) from investments in securities		860		(731	)		481		(253	)
Interest expense		95,777		97,103			290,164		285,887
Losses from early extinguishments of debt		—		—			—		8,221
Noncontrolling interest in property partnerships		86		889			1,118		2,557
Noncontrolling interest—redeemable preferred units of the Operating Partnership		832		820			2,497		2,548
Noncontrolling interest—common units of the Operating Partnership		8,991		8,712			23,409		25,841
Noncontrolling interest in gains on sales of real estate—common units of the Operating Partnership		—		—			—		351
Net income attributable to Boston Properties, Inc.	$	70,542	$	57,668		$	171,359	$	171,786