Segment Information |
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 Boston, New York, Princeton, San Francisco and Washington, DC. Segments by property type include: Class A Office, Office/Technical, Residential and Hotel. 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, transaction costs, impairment loss, interest expense, depreciation and amortization expense, gains from investments in securities, gains from early extinguishments of debt, income from unconsolidated joint ventures, discontinued operations 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 (dollars in thousands): For the three months ended March 31, 2013: | | | | | | | | | | | | | | | | | | | | | | | | | | Boston | | New York | | Princeton | | San Francisco | | Washington, DC | | Total | Rental Revenue: | | | | | | | | | | | | Class A Office | $ | 161,503 |
| | $ | 122,096 |
| | $ | 16,427 |
| | $ | 52,671 |
| | $ | 97,865 |
| | $ | 450,562 |
| Office/Technical | 5,653 |
| | — |
| | — |
| | 151 |
| | 4,043 |
| | 9,847 |
| Residential | 1,067 |
| | — |
| | — |
| | — |
| | 4,511 |
| | 5,578 |
| Hotel | 8,291 |
| | — |
| | — |
| | — |
| | — |
| | 8,291 |
| Total | 176,514 |
| | 122,096 |
| | 16,427 |
| | 52,822 |
| | 106,419 |
| | 474,278 |
| % of Grand Totals | 37.22 | % | | 25.74 | % | | 3.46 | % | | 11.14 | % | | 22.44 | % | | 100.0 | % | Rental Expenses: | | | | | | | | | | | | Class A Office | 65,732 |
| | 41,887 |
| | 7,647 |
| | 19,872 |
| | 31,923 |
| | 167,061 |
| Office/Technical | 1,787 |
| | — |
| | — |
| | 35 |
| | 1,004 |
| | 2,826 |
| Residential | 443 |
| | — |
| | — |
| | — |
| | 2,290 |
| | 2,733 |
| Hotel | 7,044 |
| | — |
| | — |
| | — |
| | — |
| | 7,044 |
| Total | 75,006 |
| | 41,887 |
| | 7,647 |
| | 19,907 |
| | 35,217 |
| | 179,664 |
| % of Grand Totals | 41.75 | % | | 23.31 | % | | 4.26 | % | | 11.08 | % | | 19.60 | % | | 100.0 | % | Net operating income | $ | 101,508 |
| | $ | 80,209 |
| | $ | 8,780 |
| | $ | 32,915 |
| | $ | 71,202 |
| | $ | 294,614 |
| % of Grand Totals | 34.45 | % | | 27.23 | % | | 2.98 | % | | 11.17 | % | | 24.17 | % | | 100.0 | % |
For the three months ended March 31, 2012: | | | | | | | | | | | | | | | | | | | | | | | | | | Boston | | New York | | Princeton | | San Francisco | | Washington, DC | | Total | Rental Revenue: | | | | | | | | | | | | Class A Office | $ | 140,217 |
| | $ | 117,589 |
| | $ | 14,850 |
| | $ | 50,664 |
| | $ | 90,398 |
| | $ | 413,718 |
| Office/Technical | 6,389 |
| | — |
| | — |
| | 52 |
| | 4,092 |
| | 10,533 |
| Residential | 883 |
| | — |
| | — |
| | — |
| | 3,598 |
| | 4,481 |
| Hotel | 6,816 |
| | — |
| | — |
| | — |
| | — |
| | 6,816 |
| Total | 154,305 |
| | 117,589 |
| | 14,850 |
| | 50,716 |
| | 98,088 |
| | 435,548 |
| % of Grand Totals | 35.43 | % | | 27.00 | % | | 3.41 | % | | 11.64 | % | | 22.52 | % | | 100.0 | % | Rental Expenses: | | | | | | | | | | | | Class A Office | 57,636 |
| | 38,429 |
| | 7,358 |
| | 19,486 |
| | 27,442 |
| | 150,351 |
| Office/Technical | 1,705 |
| | — |
| | — |
| | 24 |
| | 1,047 |
| | 2,776 |
| Residential | 390 |
| | — |
| | — |
| | — |
| | 2,325 |
| | 2,715 |
| Hotel | 6,099 |
| | — |
| | — |
| | — |
| | — |
| | 6,099 |
| Total | 65,830 |
| | 38,429 |
| | 7,358 |
| | 19,510 |
| | 30,814 |
| | 161,941 |
| % of Grand Totals | 40.65 | % | | 23.73 | % | | 4.54 | % | | 12.05 | % | | 19.03 | % | | 100.0 | % | Net operating income | $ | 88,475 |
| | $ | 79,160 |
| | $ | 7,492 |
| | $ | 31,206 |
| | $ | 67,274 |
| | $ | 273,607 |
| % of Grand Totals | 32.34 | % | | 28.93 | % | | 2.74 | % | | 11.40 | % | | 24.59 | % | | 100.0 | % |
The following is a reconciliation of Net Operating Income to net income attributable to Boston Properties, Inc.: | | | | | | | | | | Three months ended March 31, | | 2013 | | 2012 | Net Operating Income | $ | 294,614 |
| | $ | 273,607 |
| Add: | | | | Development and management services income | 8,736 |
| | 8,145 |
| Income from unconsolidated joint ventures | 8,721 |
| | 11,721 |
| Interest and other income | 1,471 |
| | 1,646 |
| Gains from investments in securities | 735 |
| | 801 |
| Gains from early extinguishments of debt | — |
| | 767 |
| Income from discontinued operations | 61 |
| | 570 |
| Gain on forgiveness of debt from discontinued operations | 20,182 |
| | — |
| Less: | | | | General and administrative expense | 43,571 |
| | 27,619 |
| Transaction costs | 443 |
| | 2,104 |
| Depreciation and amortization expense | 120,595 |
| | 108,462 |
| Interest expense | 100,433 |
| | 103,237 |
| Impairment loss | 8,306 |
| | — |
| Impairment loss from discontinued operations | 3,241 |
| | — |
| Noncontrolling interest in property partnerships | 2,574 |
| | 546 |
| Noncontrolling interest—redeemable preferred units of the Operating Partnership | 1,180 |
| | 801 |
| Noncontrolling interest—common units of the Operating Partnership | 4,358 |
| | 5,973 |
| Noncontrolling interest in discontinued operations—common units of the Operating Partnership | 1,819 |
| | 61 |
| Net income attributable to Boston Properties, Inc. | $ | 48,000 |
| | $ | 48,454 |
|
|