ý | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Boston Properties, Inc. | Delaware | 04-2473675 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) | |
Boston Properties Limited Partnership | Delaware | 04-3372948 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) |
Boston Properties, Inc. | Common Stock, par value $0.01 per share | 154,317,716 |
(Registrant) | (Class) | (Outstanding on August 3, 2017) |
• | enhances investors’ understanding of BXP and BPLP by enabling investors to view the business as a whole in the same manner as management views and operates the business; |
• | eliminates duplicative disclosure and provides a more concise and readable presentation because a substantial portion of the disclosure applies to both BXP and BPLP; and |
• | creates time and cost efficiencies through the preparation of one combined report instead of two separate reports. |
• | Item 1. Financial Statements (unaudited), which includes the following specific disclosures for BXP and BPLP: |
• | Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations includes information specific to each entity, where applicable; and |
• | Item 2. Liquidity and Capital Resources includes separate reconciliations of amounts to each entity’s financial statements, where applicable. |
Page | ||
ITEM 1. | ||
Boston Properties, Inc. | ||
Boston Properties Limited Partnership | ||
Boston Properties, Inc. and Boston Properties Limited Partnership | ||
ITEM 2. | ||
ITEM 3. | ||
ITEM 4. | ||
ITEM 1. | ||
ITEM 1A. | ||
ITEM 2. | ||
ITEM 3. | ||
ITEM 4. | ||
ITEM 5. | ||
ITEM 6. | ||
BOSTON PROPERTIES, INC. CONSOLIDATED BALANCE SHEETS (Unaudited) | |||||||
June 30, 2017 | December 31, 2016 | ||||||
(in thousands, except for share and par value amounts) | |||||||
ASSETS | |||||||
Real estate, at cost (amounts related to variable interest entities (“VIEs”) of $7,000,820 and $6,760,078 at June 30, 2017 and December 31, 2016, respectively) | $ | 20,614,366 | $ | 20,147,263 | |||
Less: accumulated depreciation (amounts related to VIEs of $(799,299) and $(758,640) at June 30, 2017 and December 31, 2016, respectively) | (4,379,446 | ) | (4,222,235 | ) | |||
Total real estate | 16,234,920 | 15,925,028 | |||||
Cash and cash equivalents (amounts related to VIEs of $322,574 and $253,999 at June 30, 2017 and December 31, 2016, respectively) | 492,435 | 356,914 | |||||
Cash held in escrows (amounts related to VIEs of $4,360 and $4,955 at June 30, 2017 and December 31, 2016, respectively) | 47,345 | 63,174 | |||||
Investments in securities | 26,781 | 23,814 | |||||
Tenant and other receivables (amounts related to VIEs of $17,950 and $23,525 at June 30, 2017 and December 31, 2016, respectively) | 88,687 | 92,548 | |||||
Accrued rental income (amounts related to VIEs of $227,199 and $224,185 at June 30, 2017 and December 31, 2016, respectively) | 820,022 | 799,138 | |||||
Deferred charges, net (amounts related to VIEs of $267,240 and $290,436 at June 30, 2017 and December 31, 2016, respectively) | 658,219 | 686,163 | |||||
Prepaid expenses and other assets (amounts related to VIEs of $41,819 and $42,718 at June 30, 2017 and December 31, 2016, respectively) | 93,985 | 129,666 | |||||
Investments in unconsolidated joint ventures | 819,368 | 775,198 | |||||
Total assets | $ | 19,281,762 | $ | 18,851,643 | |||
LIABILITIES AND EQUITY | |||||||
Liabilities: | |||||||
Mortgage notes payable, net (amounts related to VIEs of $2,943,890 and $2,018,483 at June 30, 2017 and December 31, 2016, respectively) | $ | 2,986,283 | $ | 2,063,087 | |||
Unsecured senior notes, net | 7,250,356 | 7,245,953 | |||||
Unsecured line of credit | — | — | |||||
Unsecured term loan | — | — | |||||
Mezzanine notes payable (amounts related to VIEs of $0 and $307,093 at June 30, 2017 and December 31, 2016, respectively) | — | 307,093 | |||||
Outside members’ notes payable (amounts related to VIEs of $0 and $180,000 at June 30, 2017 and December 31, 2016, respectively) | — | 180,000 | |||||
Accounts payable and accrued expenses (amounts related to VIEs of $116,413 and $110,457 at June 30, 2017 and December 31, 2016, respectively) | 303,559 | 298,524 | |||||
Dividends and distributions payable | 130,432 | 130,308 | |||||
Accrued interest payable (amounts related to VIEs of $6,706 and $162,226 at June 30, 2017 and December 31, 2016, respectively) | 85,172 | 243,933 | |||||
Other liabilities (amounts related to VIEs of $159,529 and $175,146 at June 30, 2017 and December 31, 2016, respectively) | 452,608 | 450,821 | |||||
Total liabilities | 11,208,410 | 10,919,719 | |||||
Commitments and contingencies | — | — | |||||
Equity: | |||||||
Stockholders’ equity attributable to Boston Properties, Inc.: | |||||||
Excess stock, $0.01 par value, 150,000,000 shares authorized, none issued or outstanding | — | — | |||||
Preferred stock, $0.01 par value, 50,000,000 shares authorized; | |||||||
5.25% Series B cumulative redeemable preferred stock, $0.01 par value, liquidation preference $2,500 per share, 92,000 shares authorized, 80,000 shares issued and outstanding at June 30, 2017 and December 31, 2016 | 200,000 | 200,000 | |||||
Common stock, $0.01 par value, 250,000,000 shares authorized, 154,386,429 and 153,869,075 issued and 154,307,529 and 153,790,175 outstanding at June 30, 2017 and December 31, 2016, respectively | 1,543 | 1,538 | |||||
Additional paid-in capital | 6,363,034 | 6,333,424 | |||||
Dividends in excess of earnings | (694,320 | ) | (693,694 | ) | |||
Treasury common stock at cost, 78,900 shares at June 30, 2017 and December 31, 2016 | (2,722 | ) | (2,722 | ) | |||
Accumulated other comprehensive loss | (53,161 | ) | (52,251 | ) | |||
Total stockholders’ equity attributable to Boston Properties, Inc. | 5,814,374 | 5,786,295 | |||||
Noncontrolling interests: | |||||||
Common units of Boston Properties Limited Partnership | 604,997 | 614,982 | |||||
Property partnerships | 1,653,981 | 1,530,647 | |||||
Total equity | 8,073,352 | 7,931,924 | |||||
Total liabilities and equity | $ | 19,281,762 | $ | 18,851,643 |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
(in thousands, except for per share amounts) | |||||||||||||||
Revenue | |||||||||||||||
Rental | |||||||||||||||
Base rent | $ | 520,542 | $ | 493,386 | $ | 1,024,104 | $ | 1,029,514 | |||||||
Recoveries from tenants | 89,163 | 85,706 | 178,327 | 175,292 | |||||||||||
Parking and other | 26,462 | 26,113 | 52,072 | 50,938 | |||||||||||
Total rental revenue | 636,167 | 605,205 | 1,254,503 | 1,255,744 | |||||||||||
Hotel revenue | 13,375 | 12,808 | 20,795 | 21,565 | |||||||||||
Development and management services | 7,365 | 5,533 | 13,837 | 12,222 | |||||||||||
Total revenue | 656,907 | 623,546 | 1,289,135 | 1,289,531 | |||||||||||
Expenses | |||||||||||||||
Operating | |||||||||||||||
Rental | 230,454 | 217,938 | 458,741 | 437,110 | |||||||||||
Hotel | 8,404 | 7,978 | 15,495 | 15,612 | |||||||||||
General and administrative | 27,141 | 25,418 | 58,527 | 54,771 | |||||||||||
Transaction costs | 299 | 913 | 333 | 938 | |||||||||||
Depreciation and amortization | 151,919 | 153,175 | 311,124 | 312,623 | |||||||||||
Total expenses | 418,217 | 405,422 | 844,220 | 821,054 | |||||||||||
Operating income | 238,690 | 218,124 | 444,915 | 468,477 | |||||||||||
Other income (expense) | |||||||||||||||
Income from unconsolidated joint ventures | 3,108 | 2,234 | 6,192 | 4,025 | |||||||||||
Interest and other income | 1,504 | 1,524 | 2,118 | 3,029 | |||||||||||
Gains from investments in securities | 730 | 478 | 1,772 | 737 | |||||||||||
Gains from early extinguishments of debt | 14,354 | — | 14,354 | — | |||||||||||
Interest expense | (95,143 | ) | (105,003 | ) | (190,677 | ) | (210,312 | ) | |||||||
Income before gains on sales of real estate | 163,243 | 117,357 | 278,674 | 265,956 | |||||||||||
Gains on sales of real estate | 3,767 | — | 3,900 | 67,623 | |||||||||||
Net income | 167,010 | 117,357 | 282,574 | 333,579 | |||||||||||
Net income attributable to noncontrolling interests | |||||||||||||||
Noncontrolling interests in property partnerships | (15,203 | ) | (6,814 | ) | (19,627 | ) | (17,278 | ) | |||||||
Noncontrolling interest—common units of Boston Properties Limited Partnership | (15,473 | ) | (11,357 | ) | (26,933 | ) | (32,771 | ) | |||||||
Net income attributable to Boston Properties, Inc. | 136,334 | 99,186 | 236,014 | 283,530 | |||||||||||
Preferred dividends | (2,625 | ) | (2,589 | ) | (5,250 | ) | (5,207 | ) | |||||||
Net income attributable to Boston Properties, Inc. common shareholders | $ | 133,709 | $ | 96,597 | $ | 230,764 | $ | 278,323 | |||||||
Basic earnings per common share attributable to Boston Properties, Inc. common shareholders: | |||||||||||||||
Net income | $ | 0.87 | $ | 0.63 | $ | 1.50 | $ | 1.81 | |||||||
Weighted average number of common shares outstanding | 154,177 | 153,662 | 154,019 | 153,644 | |||||||||||
Diluted earnings per common share attributable to Boston Properties, Inc. common shareholders: | |||||||||||||||
Net income | $ | 0.87 | $ | 0.63 | $ | 1.50 | $ | 1.81 | |||||||
Weighted average number of common and common equivalent shares outstanding | 154,331 | 153,860 | 154,273 | 153,889 | |||||||||||
Dividends per common share | $ | 0.75 | $ | 0.65 | $ | 1.50 | $ | 1.30 |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
(in thousands) | |||||||||||||||
Net income | $ | 167,010 | $ | 117,357 | $ | 282,574 | $ | 333,579 | |||||||
Other comprehensive loss: | |||||||||||||||
Effective portion of interest rate contracts | (6,313 | ) | (32,351 | ) | (6,133 | ) | (90,997 | ) | |||||||
Amortization of interest rate contracts (1) | 1,397 | 628 | 2,703 | 1,255 | |||||||||||
Other comprehensive loss | (4,916 | ) | (31,723 | ) | (3,430 | ) | (89,742 | ) | |||||||
Comprehensive income | 162,094 | 85,634 | 279,144 | 243,837 | |||||||||||
Net income attributable to noncontrolling interests | (30,676 | ) | (18,171 | ) | (46,560 | ) | (50,049 | ) | |||||||
Other comprehensive loss attributable to noncontrolling interests | 2,738 | 8,681 | 2,520 | 24,108 | |||||||||||
Comprehensive income attributable to Boston Properties, Inc. | $ | 134,156 | $ | 76,144 | $ | 235,104 | $ | 217,896 |
Common Stock | Preferred Stock | Additional Paid-in Capital | Dividends in Excess of Earnings | Treasury Stock, at cost | Accumulated Other Comprehensive Loss | Noncontrolling Interests | Total | |||||||||||||||||||||||||||
Shares | Amount | |||||||||||||||||||||||||||||||||
Equity, December 31, 2016 | 153,790 | $ | 1,538 | $ | 200,000 | $ | 6,333,424 | $ | (693,694 | ) | $ | (2,722 | ) | $ | (52,251 | ) | $ | 2,145,629 | $ | 7,931,924 | ||||||||||||||
Redemption of operating partnership units to common stock | 481 | 5 | — | 16,417 | — | — | — | (16,422 | ) | — | ||||||||||||||||||||||||
Allocated net income for the year | — | — | — | — | 236,014 | — | — | 46,560 | 282,574 | |||||||||||||||||||||||||
Dividends/distributions declared | — | — | — | — | (236,368 | ) | — | — | (26,977 | ) | (263,345 | ) | ||||||||||||||||||||||
Shares issued pursuant to stock purchase plan | 3 | — | — | 373 | — | — | — | — | 373 | |||||||||||||||||||||||||
Net activity from stock option and incentive plan | 34 | — | — | 1,980 | — | — | — | 19,188 | 21,168 | |||||||||||||||||||||||||
Cumulative effect of a change in accounting principle | — | — | — | — | (272 | ) | — | — | (1,763 | ) | (2,035 | ) | ||||||||||||||||||||||
Contributions from noncontrolling interests in property partnerships | — | — | — | — | — | — | — | 133,072 | 133,072 | |||||||||||||||||||||||||
Distributions to noncontrolling interests in property partnerships | — | — | — | — | — | — | — | (26,949 | ) | (26,949 | ) | |||||||||||||||||||||||
Effective portion of interest rate contracts | — | — | — | — | — | — | (3,301 | ) | (2,832 | ) | (6,133 | ) | ||||||||||||||||||||||
Amortization of interest rate contracts | — | — | — | — | — | — | 2,391 | 312 | 2,703 | |||||||||||||||||||||||||
Reallocation of noncontrolling interest | — | — | — | 10,840 | — | — | — | (10,840 | ) | — | ||||||||||||||||||||||||
Equity, June 30, 2017 | 154,308 | $ | 1,543 | $ | 200,000 | $ | 6,363,034 | $ | (694,320 | ) | $ | (2,722 | ) | $ | (53,161 | ) | $ | 2,258,978 | $ | 8,073,352 | ||||||||||||||
Equity, December 31, 2015 | 153,580 | $ | 1,536 | $ | 200,000 | $ | 6,305,687 | $ | (780,952 | ) | $ | (2,722 | ) | $ | (14,114 | ) | $ | 2,177,492 | $ | 7,886,927 | ||||||||||||||
Redemption of operating partnership units to common stock | 78 | 1 | — | 2,663 | — | — | — | (2,664 | ) | — | ||||||||||||||||||||||||
Allocated net income for the year | — | — | — | — | 283,530 | — | — | 50,049 | 333,579 | |||||||||||||||||||||||||
Dividends/distributions declared | — | — | — | — | (204,939 | ) | — | — | (23,713 | ) | (228,652 | ) | ||||||||||||||||||||||
Shares issued pursuant to stock purchase plan | 3 | — | — | 332 | — | — | — | — | 332 | |||||||||||||||||||||||||
Net activity from stock option and incentive plan | 14 | — | — | 1,772 | — | — | — | 14,877 | 16,649 | |||||||||||||||||||||||||
Sale of interests in property partnerships | — | — | — | 1,320 | — | — | — | (1,320 | ) | — | ||||||||||||||||||||||||
Contributions from noncontrolling interests in property partnerships | — | — | — | — | — | — | — | 5,040 | 5,040 | |||||||||||||||||||||||||
Distributions to noncontrolling interests in property partnerships | — | — | — | — | — | — | — | (25,914 | ) | (25,914 | ) | |||||||||||||||||||||||
Effective portion of interest rate contracts | — | — | — | — | — | — | (66,759 | ) | (24,238 | ) | (90,997 | ) | ||||||||||||||||||||||
Amortization of interest rate contracts | — | — | — | — | — | — | 1,125 | 130 | 1,255 | |||||||||||||||||||||||||
Reallocation of noncontrolling interest | — | — | — | 4,417 | — | — | — | (4,417 | ) | — | ||||||||||||||||||||||||
Equity, June 30, 2016 | 153,675 | $ | 1,537 | $ | 200,000 | $ | 6,316,191 | $ | (702,361 | ) | $ | (2,722 | ) | $ | (79,748 | ) | $ | 2,165,322 | $ | 7,898,219 |
For the six months ended June 30, | |||||||
2017 | 2016 | ||||||
(in thousands) | |||||||
Cash flows from operating activities: | |||||||
Net income | $ | 282,574 | $ | 333,579 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 311,124 | 312,623 | |||||
Non-cash compensation expense | 19,237 | 17,647 | |||||
Income from unconsolidated joint ventures | (6,192 | ) | (4,025 | ) | |||
Distributions of net cash flow from operations of unconsolidated joint ventures | 2,905 | 11,399 | |||||
Gains from investments in securities | (1,772 | ) | (737 | ) | |||
Gains from early extinguishments of debt | (14,444 | ) | — | ||||
Non-cash portion of interest expense | (11,979 | ) | (19,330 | ) | |||
Gains on sales of real estate | (3,900 | ) | (67,623 | ) | |||
Change in assets and liabilities: | |||||||
Cash held in escrows | 7,531 | 632 | |||||
Tenant and other receivables, net | 2,033 | 13,963 | |||||
Accrued rental income, net | (19,348 | ) | (5,294 | ) | |||
Prepaid expenses and other assets | 36,223 | 62,752 | |||||
Accounts payable and accrued expenses | (2,608 | ) | 9,236 | ||||
Accrued interest payable | (158,761 | ) | 31,789 | ||||
Other liabilities | (33,093 | ) | (71,805 | ) | |||
Tenant leasing costs | (37,252 | ) | (40,655 | ) | |||
Total adjustments | 89,704 | 250,572 | |||||
Net cash provided by operating activities | 372,278 | 584,151 | |||||
Cash flows from investing activities: | |||||||
Acquisitions of real estate | (15,953 | ) | (78,000 | ) | |||
Construction in progress | (297,747 | ) | (242,944 | ) | |||
Building and other capital improvements | (100,808 | ) | (48,306 | ) | |||
Tenant improvements | (107,533 | ) | (116,935 | ) | |||
Proceeds from sales of real estate | 17,049 | 104,816 | |||||
Proceeds from sales of real estate placed in escrow | (16,640 | ) | (104,696 | ) | |||
Proceeds from sales of real estate released from escrow | 15,844 | 104,696 | |||||
Cash released from escrow for investing activities | 9,004 | 6,694 | |||||
Cash released from escrow for land sale contracts | — | 781 | |||||
Deposit on real estate | — | (25,000 | ) | ||||
Capital contributions to unconsolidated joint ventures | (41,491 | ) | (26,040 | ) | |||
Investments in securities, net | (1,195 | ) | (658 | ) | |||
Net cash used in investing activities | (539,470 | ) | (425,592 | ) | |||
BOSTON PROPERTIES, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) | |||||||
For the six months ended June 30, | |||||||
2017 | 2016 | ||||||
(in thousands) | |||||||
Cash flows from financing activities: | |||||||
Proceeds from mortgage notes payable | 2,300,000 | — | |||||
Repayments of mortgage notes payable | (1,308,708 | ) | (222,535 | ) | |||
Proceeds from unsecured senior notes | — | 997,080 | |||||
Borrowings on unsecured line of credit | 430,000 | — | |||||
Repayments of unsecured line of credit | (430,000 | ) | — | ||||
Repayments of mezzanine notes payable | (306,000 | ) | — | ||||
Repayments of outside members’ notes payable | (70,424 | ) | — | ||||
Payments on capital lease obligations | (486 | ) | — | ||||
Payments on real estate financing transactions | (1,013 | ) | (4,290 | ) | |||
Deposit on mortgage note payable interest rate lock | (23,200 | ) | — | ||||
Return of deposit on mortgage note payable interest rate lock | 23,200 | — | |||||
Deferred financing costs | (43,635 | ) | (8,047 | ) | |||
Net proceeds from equity transactions | (181 | ) | (666 | ) | |||
Dividends and distributions | (263,221 | ) | (442,901 | ) | |||
Contributions from noncontrolling interests in property partnerships | 23,496 | 5,040 | |||||
Distributions to noncontrolling interests in property partnerships | (27,115 | ) | (25,914 | ) | |||
Net cash provided by financing activities | 302,713 | 297,767 | |||||
Net increase in cash and cash equivalents | 135,521 | 456,326 | |||||
Cash and cash equivalents, beginning of period | 356,914 | 723,718 | |||||
Cash and cash equivalents, end of period | $ | 492,435 | $ | 1,180,044 | |||
Supplemental disclosures: | |||||||
Cash paid for interest | $ | 388,045 | $ | 217,021 | |||
Interest capitalized | $ | 26,628 | $ | 19,168 | |||
Non-cash investing and financing activities: | |||||||
Write-off of fully depreciated real estate | $ | (86,135 | ) | $ | (52,708 | ) | |
Additions to real estate included in accounts payable and accrued expenses | $ | 22,994 | $ | (14,471 | ) | ||
Real estate acquired through capital lease | $ | 28,962 | $ | — | |||
Outside members’ notes payable contributed to noncontrolling interests in property partnerships | $ | 109,576 | $ | — | |||
Dividends and distributions declared but not paid | $ | 130,432 | $ | 113,071 | |||
Conversions of noncontrolling interests to stockholders’ equity | $ | 16,422 | $ | 2,664 | |||
Issuance of restricted securities to employees | $ | 35,945 | $ | 33,711 |
BOSTON PROPERTIES LIMITED PARTNERSHIP CONSOLIDATED BALANCE SHEETS (Unaudited) | |||||||
June 30, 2017 | December 31, 2016 | ||||||
(in thousands, except for unit amounts) | |||||||
ASSETS | |||||||
Real estate, at cost (amounts related to variable interest entities (“VIEs”) of $7,000,820 and $6,760,078 at June 30, 2017 and December 31, 2016, respectively) | $ | 20,202,321 | $ | 19,733,872 | |||
Less: accumulated depreciation (amounts related to VIEs of $(799,299) and $(758,640) at June 30, 2017 and December 31, 2016, respectively) | (4,290,112 | ) | (4,136,364 | ) | |||
Total real estate | 15,912,209 | 15,597,508 | |||||
Cash and cash equivalents (amounts related to VIEs of $322,574 and $253,999 at June 30, 2017 and December 31, 2016, respectively) | 492,435 | 356,914 | |||||
Cash held in escrows (amounts related to VIEs of $4,360 and $4,955 at June 30, 2017 and December 31, 2016, respectively) | 47,345 | 63,174 | |||||
Investments in securities | 26,781 | 23,814 | |||||
Tenant and other receivables (amounts related to VIEs of $17,950 and $23,525 at June 30, 2017 and December 31, 2016, respectively) | 88,687 | 92,548 | |||||
Accrued rental income (amounts related to VIEs of $227,199 and $224,185 at June 30, 2017 and December 31, 2016, respectively) | 820,022 | 799,138 | |||||
Deferred charges, net (amounts related to VIEs of $267,240 and $290,436 at June 30, 2017 and December 31, 2016, respectively) | 658,219 | 686,163 | |||||
Prepaid expenses and other assets (amounts related to VIEs of $41,819 and $42,718 at June 30, 2017 and December 31, 2016, respectively) | 93,985 | 129,666 | |||||
Investments in unconsolidated joint ventures | 819,368 | 775,198 | |||||
Total assets | $ | 18,959,051 | $ | 18,524,123 | |||
LIABILITIES AND CAPITAL | |||||||
Liabilities: | |||||||
Mortgage notes payable, net (amounts related to VIEs of $2,943,890 and $2,018,483 at June 30, 2017 and December 31, 2016, respectively) | $ | 2,986,283 | $ | 2,063,087 | |||
Unsecured senior notes, net | 7,250,356 | 7,245,953 | |||||
Unsecured line of credit | — | — | |||||
Unsecured term loan | — | — | |||||
Mezzanine notes payable (amounts related to VIEs of $0 and $307,093 at June 30, 2017 and December 31, 2016, respectively) | — | 307,093 | |||||
Outside members’ notes payable (amounts related to VIEs of $0 and $180,000 at June 30, 2017 and December 31, 2016, respectively) | — | 180,000 | |||||
Accounts payable and accrued expenses (amounts related to VIEs of $116,413 and $110,457 at June 30, 2017 and December 31, 2016, respectively) | 303,559 | 298,524 | |||||
Distributions payable | 130,432 | 130,308 | |||||
Accrued interest payable (amounts related to VIEs of $6,706 and $162,226 at June 30, 2017 and December 31, 2016, respectively) | 85,172 | 243,933 | |||||
Other liabilities (amounts related to VIEs of $159,529 and $175,146 at June 30, 2017 and December 31, 2016, respectively) | 452,608 | 450,821 | |||||
Total liabilities | 11,208,410 | 10,919,719 | |||||
Commitments and contingencies | — | — | |||||
Noncontrolling interests: | |||||||
Redeemable partnership units—16,823,685 and 17,079,511 common units and 816,982 and 904,588 long term incentive units outstanding at redemption value at June 30, 2017 and December 31, 2016, respectively | 2,170,155 | 2,262,040 | |||||
Capital: | |||||||
5.25% Series B cumulative redeemable preferred units, liquidation preference $2,500 per unit, 80,000 units issued and outstanding at June 30, 2017 and December 31, 2016 | 193,623 | 193,623 | |||||
Boston Properties Limited Partnership partners’ capital—1,719,482 and 1,717,743 general partner units and 152,588,047 and 152,072,432 limited partner units outstanding at June 30, 2017 and December 31, 2016, respectively | 3,732,882 | 3,618,094 | |||||
Noncontrolling interests in property partnerships | 1,653,981 | 1,530,647 | |||||
Total capital | 5,580,486 | 5,342,364 | |||||
Total liabilities and capital | $ | 18,959,051 | $ | 18,524,123 |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
(in thousands, except for per unit amounts) | |||||||||||||||
Revenue | |||||||||||||||
Rental | |||||||||||||||
Base rent | $ | 520,542 | $ | 493,386 | $ | 1,024,104 | $ | 1,029,514 | |||||||
Recoveries from tenants | 89,163 | 85,706 | 178,327 | 175,292 | |||||||||||
Parking and other | 26,462 | 26,113 | 52,072 | 50,938 | |||||||||||
Total rental revenue | 636,167 | 605,205 | 1,254,503 | 1,255,744 | |||||||||||
Hotel revenue | 13,375 | 12,808 | 20,795 | 21,565 | |||||||||||
Development and management services | 7,365 | 5,533 | 13,837 | 12,222 | |||||||||||
Total revenue | 656,907 | 623,546 | 1,289,135 | 1,289,531 | |||||||||||
Expenses | |||||||||||||||
Operating | |||||||||||||||
Rental | 230,454 | 217,938 | 458,741 | 437,110 | |||||||||||
Hotel | 8,404 | 7,978 | 15,495 | 15,612 | |||||||||||
General and administrative | 27,141 | 25,418 | 58,527 | 54,771 | |||||||||||
Transaction costs | 299 | 913 | 333 | 938 | |||||||||||
Depreciation and amortization | 149,834 | 151,191 | 306,892 | 308,652 | |||||||||||
Total expenses | 416,132 | 403,438 | 839,988 | 817,083 | |||||||||||
Operating income | 240,775 | 220,108 | 449,147 | 472,448 | |||||||||||
Other income (expense) | |||||||||||||||
Income from unconsolidated joint ventures | 3,108 | 2,234 | 6,192 | 4,025 | |||||||||||
Interest and other income | 1,504 | 1,524 | 2,118 | 3,029 | |||||||||||
Gains from investments in securities | 730 | 478 | 1,772 | 737 | |||||||||||
Gains from early extinguishments of debt | 14,354 | — | 14,354 | — | |||||||||||
Interest expense | (95,143 | ) | (105,003 | ) | (190,677 | ) | (210,312 | ) | |||||||
Income before gains on sales of real estate | 165,328 | 119,341 | 282,906 | 269,927 | |||||||||||
Gains on sales of real estate | 4,344 | — | 4,477 | 69,792 | |||||||||||
Net income | 169,672 | 119,341 | 287,383 | 339,719 | |||||||||||
Net income attributable to noncontrolling interests | |||||||||||||||
Noncontrolling interests in property partnerships | (15,203 | ) | (6,814 | ) | (19,627 | ) | (17,278 | ) | |||||||
Net income attributable to Boston Properties Limited Partnership | 154,469 | 112,527 | 267,756 | 322,441 | |||||||||||
Preferred distributions | (2,625 | ) | (2,589 | ) | (5,250 | ) | (5,207 | ) | |||||||
Net income attributable to Boston Properties Limited Partnership common unitholders | $ | 151,844 | $ | 109,938 | $ | 262,506 | $ | 317,234 | |||||||
Basic earnings per common unit attributable to Boston Properties Limited Partnership common unitholders: | |||||||||||||||
Net income | $ | 0.88 | $ | 0.64 | $ | 1.53 | $ | 1.85 | |||||||
Weighted average number of common units outstanding | 171,675 | 171,370 | 171,628 | 171,339 | |||||||||||
Diluted earnings per common unit attributable to Boston Properties Limited Partnership common unitholders: | |||||||||||||||
Net income | $ | 0.88 | $ | 0.64 | $ | 1.53 | $ | 1.85 | |||||||
Weighted average number of common and common equivalent units outstanding | 171,829 | 171,568 | 171,882 | 171,584 | |||||||||||
Distributions per common unit | $ | 0.75 | $ | 0.65 | $ | 1.50 | $ | 1.30 |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
(in thousands) | |||||||||||||||
Net income | $ | 169,672 | $ | 119,341 | $ | 287,383 | $ | 339,719 | |||||||
Other comprehensive loss: | |||||||||||||||
Effective portion of interest rate contracts | (6,313 | ) | (32,351 | ) | (6,133 | ) | (90,997 | ) | |||||||
Amortization of interest rate contracts (1) | 1,397 | 628 | 2,703 | 1,255 | |||||||||||
Other comprehensive loss | (4,916 | ) | (31,723 | ) | (3,430 | ) | (89,742 | ) | |||||||
Comprehensive income | 164,756 | 87,618 | 283,953 | 249,977 | |||||||||||
Comprehensive income attributable to noncontrolling interests | (12,715 | ) | (793 | ) | (17,211 | ) | (731 | ) | |||||||
Comprehensive income attributable to Boston Properties Limited Partnership | $ | 152,041 | $ | 86,825 | $ | 266,742 | $ | 249,246 |
Total Partners’ Capital | |||
Balance at December 31, 2016 | $ | 3,811,717 | |
Contributions | 4,682 | ||
Net income allocable to general and limited partner units | 240,823 | ||
Distributions | (236,368 | ) | |
Accumulated other comprehensive loss | (910 | ) | |
Cumulative effect of a change in accounting principle | (272 | ) | |
Unearned compensation | (2,329 | ) | |
Conversion of redeemable partnership units | 16,422 | ||
Adjustment to reflect redeemable partnership units at redemption value | 92,740 | ||
Balance at June 30, 2017 | $ | 3,926,505 | |
Balance at December 31, 2015 | $ | 3,684,522 | |
Contributions | 2,871 | ||
Net income allocable to general and limited partner units | 289,670 | ||
Distributions | (204,939 | ) | |
Accumulated other comprehensive loss | (65,634 | ) | |
Unearned compensation | 553 | ||
Conversion of redeemable partnership units | 2,664 | ||
Adjustment to reflect redeemable partnership units at redemption value | (86,626 | ) | |
Balance at June 30, 2016 | $ | 3,623,081 |
BOSTON PROPERTIES LIMITED PARTNERSHIP CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) | |||||||
For the six months ended June 30, | |||||||
2017 | 2016 | ||||||
(in thousands) | |||||||
Cash flows from operating activities: | |||||||
Net income | $ | 287,383 | $ | 339,719 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 306,892 | 308,652 | |||||
Non-cash compensation expense | 19,237 | 17,647 | |||||
Income from unconsolidated joint ventures | (6,192 | ) | (4,025 | ) | |||
Distributions of net cash flow from operations of unconsolidated joint ventures | 2,905 | 11,399 | |||||
Gains from investments in securities | (1,772 | ) | (737 | ) | |||
Gains from early extinguishments of debt | (14,444 | ) | — | ||||
Non-cash portion of interest expense | (11,979 | ) | (19,330 | ) | |||
Gains on sales of real estate | (4,477 | ) | (69,792 | ) | |||
Change in assets and liabilities: | |||||||
Cash held in escrows | 7,531 | 632 | |||||
Tenant and other receivables, net | 2,033 | 13,963 | |||||
Accrued rental income, net | (19,348 | ) | (5,294 | ) | |||
Prepaid expenses and other assets | 36,223 | 62,752 | |||||
Accounts payable and accrued expenses | (2,608 | ) | 9,236 | ||||
Accrued interest payable | (158,761 | ) | 31,789 | ||||
Other liabilities | (33,093 | ) | (71,805 | ) | |||
Tenant leasing costs | (37,252 | ) | (40,655 | ) | |||
Total adjustments | 84,895 | 244,432 | |||||
Net cash provided by operating activities | 372,278 | 584,151 | |||||
Cash flows from investing activities: | |||||||
Acquisitions of real estate | (15,953 | ) | (78,000 | ) | |||
Construction in progress | (297,747 | ) | (242,944 | ) | |||
Building and other capital improvements | (100,808 | ) | (48,306 | ) | |||
Tenant improvements | (107,533 | ) | (116,935 | ) | |||
Proceeds from sales of real estate | 17,049 | 104,816 | |||||
Proceeds from sales of real estate placed in escrow | (16,640 | ) | (104,696 | ) | |||
Proceeds from sales of real estate released from escrow | 15,844 | 104,696 | |||||
Cash released from escrow for investing activities | 9,004 | 6,694 | |||||
Cash released from escrow for land sale contracts | — | 781 | |||||
Deposit on real estate | — | (25,000 | ) | ||||
Capital contributions to unconsolidated joint ventures | (41,491 | ) | (26,040 | ) | |||
Investments in securities, net | (1,195 | ) | (658 | ) | |||
Net cash used in investing activities | (539,470 | ) | (425,592 | ) | |||
BOSTON PROPERTIES LIMITED PARTNERSHIP CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) | |||||||
For the six months ended June 30, | |||||||
2017 | 2016 | ||||||
(in thousands) | |||||||
Cash flows from financing activities: | |||||||
Proceeds from mortgage notes payable | 2,300,000 | — | |||||
Repayments of mortgage notes payable | (1,308,708 | ) | (222,535 | ) | |||
Proceeds from unsecured senior notes | — | 997,080 | |||||
Borrowings on unsecured line of credit | 430,000 | — | |||||
Repayments of unsecured line of credit | (430,000 | ) | — | ||||
Repayments of mezzanine notes payable | (306,000 | ) | — | ||||
Repayments of outside members’ notes payable | (70,424 | ) | — | ||||
Payments on capital lease obligations | (486 | ) | — | ||||
Payments on real estate financing transaction | (1,013 | ) | (4,290 | ) | |||
Deposit on mortgage note payable interest rate lock | (23,200 | ) | — | ||||
Return of deposit on mortgage note payable interest rate lock | 23,200 | — | |||||
Deferred financing costs | (43,635 | ) | (8,047 | ) | |||
Net proceeds from equity transactions | (181 | ) | (666 | ) | |||
Distributions | (263,221 | ) | (442,901 | ) | |||
Contributions from noncontrolling interests in property partnerships | 23,496 | 5,040 | |||||
Distributions to noncontrolling interests in property partnerships | (27,115 | ) | (25,914 | ) | |||
Net cash provided by financing activities | 302,713 | 297,767 | |||||
Net increase in cash and cash equivalents | 135,521 | 456,326 | |||||
Cash and cash equivalents, beginning of period | 356,914 | 723,718 | |||||
Cash and cash equivalents, end of period | $ | 492,435 | $ | 1,180,044 | |||
Supplemental disclosures: | |||||||
Cash paid for interest | $ | 388,045 | $ | 217,021 | |||
Interest capitalized | $ | 26,628 | $ | 19,168 | |||
Non-cash investing and financing activities: | |||||||
Write-off of fully depreciated real estate | $ | (85,525 | ) | $ | (52,708 | ) | |
Additions to real estate included in accounts payable and accrued expenses | $ | 22,994 | $ | (14,471 | ) | ||
Real estate acquired through capital lease | $ | 28,962 | $ | — | |||
Outside members’ notes payable contributed to noncontrolling interests in property partnerships | $ | 109,576 | $ | — | |||
Distributions declared but not paid | $ | 130,432 | $ | 113,071 | |||
Conversions of redeemable partnership units to partners’ capital | $ | 16,422 | $ | 2,664 | |||
Issuance of restricted securities to employees | $ | 35,945 | $ | 33,711 |
• | common units of partnership interest (also referred to as “OP Units”), |
• | long term incentive units of partnership interest (also referred to as “LTIP Units”), and |
• | preferred units of partnership interest (also referred to as “Preferred Units”). |
• | 164 Office properties (including six properties under construction/redevelopment); |
• | one hotel; |
• | five retail properties; and |
• | five residential properties (including three properties under construction). |
June 30, 2017 | December 31, 2016 | ||||||||||||||||||
Carrying Amount | Estimated Fair Value | Carrying Amount | Estimated Fair Value | ||||||||||||||||
Mortgage notes payable, net | $ | 2,986,283 | $ | 3,056,829 | $ | 2,063,087 | $ | 2,092,237 | |||||||||||
Mezzanine notes payable | — | — | 307,093 | 308,344 | |||||||||||||||
Unsecured senior notes, net | 7,250,356 | 7,516,131 | 7,245,953 | 7,428,077 | |||||||||||||||
Total | $ | 10,236,639 | $ | 10,572,960 | $ | 9,616,133 | $ | 9,828,658 |
June 30, 2017 | December 31, 2016 | ||||||
Land | $ | 4,880,337 | $ | 4,879,020 | |||
Land held for future development (1) | 250,451 | 246,656 | |||||
Buildings and improvements | 11,960,865 | 11,890,626 | |||||
Tenant improvements | 2,136,739 | 2,060,315 | |||||
Furniture, fixtures and equipment | 37,136 | 32,687 | |||||
Construction in progress | 1,348,838 | 1,037,959 | |||||
Total | 20,614,366 | 20,147,263 | |||||
Less: Accumulated depreciation | (4,379,446 | ) | (4,222,235 | ) | |||
$ | 16,234,920 | $ | 15,925,028 |
(1) | Includes pre-development costs. |
June 30, 2017 | December 31, 2016 | ||||||
Land | $ | 4,775,961 | $ | 4,774,460 | |||
Land held for future development (1) | 250,451 | 246,656 | |||||
Buildings and improvements | 11,653,196 | 11,581,795 | |||||
Tenant improvements | 2,136,739 | 2,060,315 | |||||
Furniture, fixtures and equipment | 37,136 | 32,687 | |||||
Construction in progress | 1,348,838 | 1,037,959 | |||||
Total | 20,202,321 | 19,733,872 | |||||
Less: Accumulated depreciation | (4,290,112 | ) | (4,136,364 | ) | |||
$ | 15,912,209 | $ | 15,597,508 |
(1) | Includes pre-development costs. |
Period from June 29, 2017 through December 31, 2017 | $ | 5 | |
2018 | 10 | ||
2019 | 10 | ||
2020 | 10 | ||
2021 | 13 | ||
Thereafter | 38,778 | ||
Total expected minimum obligations | 38,826 | ||
Interest portion | (9,864 | ) | |
Present value of net expected minimum payments | $ | 28,962 |
Land | $ | 2,890 | |
Building and improvements | 11,229 | ||
Tenant improvements | 871 | ||
In-place lease intangibles | 2,389 | ||
Below-market lease intangible | (1,426 | ) | |
Net assets acquired | $ | 15,953 |
Acquired In-Place Lease Intangibles | Acquired Below- Market Lease Intangibles | ||||||
Period from May 15, 2017 through December 31, 2017 | $ | 660 | $ | (248 | ) | ||
2018 | 590 | (363 | ) | ||||
2019 | 367 | (337 | ) | ||||
2020 | 243 | (308 | ) | ||||
2021 | 96 | (105 | ) |
Nominal % Ownership | Carrying Value of Investment (1) | ||||||||||||
Entity | Properties | June 30, 2017 | December 31, 2016 | ||||||||||
(in thousands) | |||||||||||||
Square 407 Limited Partnership | Market Square North | 50.0 | % | $ | (7,490 | ) | $ | (8,134 | ) | ||||
The Metropolitan Square Associates LLC | Metropolitan Square | 20.0 | % | 2,496 | 2,004 | ||||||||
BP/CRF 901 New York Avenue LLC | 901 New York Avenue | 25.0 | % | (2) | (9,719 | ) | (10,564 | ) | |||||
WP Project Developer LLC | Wisconsin Place Land and Infrastructure | 33.3 | % | (3) | 40,704 | 41,605 | |||||||
Annapolis Junction NFM, LLC | Annapolis Junction | 50.0 | % | (4) | 19,392 | 20,539 | |||||||
540 Madison Venture LLC | 540 Madison Avenue | 60.0 | % | 68,325 | 67,816 | ||||||||
500 North Capitol Venture LLC | 500 North Capitol Street, NW | 30.0 | % | (3,396 | ) | (3,389 | ) | ||||||
501 K Street LLC | 1001 6th Street | 50.0 | % | (5) | 42,428 | 42,528 | |||||||
Podium Developer LLC | The Hub on Causeway | 50.0 | % | 45,616 | 29,869 | ||||||||
Residential Tower Developer LLC | The Hub on Causeway - Residential | 50.0 | % | 23,799 | 20,803 | ||||||||
Hotel Tower Developer LLC | The Hub on Causeway - Hotel | 50.0 | % | 1,561 | 933 | ||||||||
1265 Main Office JV LLC | 1265 Main Street | 50.0 | % | 4,654 | 4,779 | ||||||||
BNY Tower Holdings LLC | Dock 72 at the Brooklyn Navy Yard | 50.0 | % | (6) | 55,646 | 33,699 | |||||||
CA-Colorado Center Limited Partnership | Colorado Center | 49.8 | % | 514,747 | 510,623 | ||||||||
$ | 798,763 | $ | 753,111 |
(1) | Investments with deficit balances aggregating approximately $20.6 million and $22.1 million at June 30, 2017 and December 31, 2016, respectively, have been reflected within Other Liabilities in the Company’s Consolidated Balance Sheets. |
(2) | The Company’s economic ownership has increased based on the achievement of certain return thresholds. |
(3) | The Company’s wholly-owned entity that owns the office component of the project also owns a 33.3% interest in the entity owning the land, parking garage and infrastructure of the project. |
(4) | The joint venture owns four in-service buildings and two undeveloped land parcels. |
(5) | Under the joint venture agreement for this land parcel, the partner will be entitled to up to two additional payments from the venture based on increases in total entitled square footage of the project above 520,000 square feet and achieving certain project returns at stabilization. |
(6) | The entity is a VIE (See Note 2). |
June 30, 2017 | December 31, 2016 | ||||||
(in thousands) | |||||||
ASSETS | |||||||
Real estate and development in process, net | $ | 1,599,268 | $ | 1,519,217 | |||
Other assets | 315,170 | 297,263 | |||||
Total assets | $ | 1,914,438 | $ | 1,816,480 | |||
LIABILITIES AND MEMBERS’/PARTNERS’ EQUITY | |||||||
Mortgage and notes payable, net | $ | 863,981 | $ | 865,665 | |||
Other liabilities | 81,047 | 67,167 | |||||
Members’/Partners’ equity | 969,410 | 883,648 | |||||
Total liabilities and members’/partners’ equity | $ | 1,914,438 | $ | 1,816,480 | |||
Company’s share of equity | $ | 498,789 | $ | 450,662 | |||
Basis differentials (1) | 299,974 | 302,449 | |||||
Carrying value of the Company’s investments in unconsolidated joint ventures (2) | $ | 798,763 | $ | 753,111 |
(1) | This amount represents the aggregate difference between the Company’s historical cost basis and the basis reflected at the joint venture level, which is typically amortized over the life of the related assets and liabilities. Basis differentials result from impairments of investments, acquisitions through joint ventures with no change in control and upon the transfer of assets that were previously owned by the Company into a joint venture. In addition, certain acquisition, transaction and other costs may not be reflected in the net assets at the joint venture level. At June 30, 2017 and December 31, 2016, there was an aggregate basis differential of approximately $325.9 million and $328.8 million, respectively, between the carrying value of the Company’s investment in the joint venture that owns Colorado Center and the joint venture’s basis in the assets and liabilities, which differential (excluding land) shall be amortized over the remaining lives of the related assets and liabilities. |
(2) | Investments with deficit balances aggregating approximately $20.6 million and $22.1 million at June 30, 2017 and December 31, 2016, respectively, have been reflected within Other Liabilities in the Company’s Consolidated Balance Sheets. |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
(in thousands) | ||||||||||||||||
Total revenue (1) | $ | 55,862 | $ | 38,368 | $ | 110,623 | $ | 76,037 | ||||||||
Expenses | ||||||||||||||||
Operating | 22,103 | 16,359 | 44,182 | 33,026 | ||||||||||||
Depreciation and amortization | 14,224 | 9,204 | 28,533 | 18,268 | ||||||||||||
Total expenses | 36,327 | 25,563 | 72,715 | 51,294 | ||||||||||||
Operating income | 19,535 | 12,805 | 37,908 | 24,743 | ||||||||||||
Other expense | ||||||||||||||||
Interest expense | 9,427 | 8,383 | 18,727 | 16,772 | ||||||||||||
Net income | $ | 10,108 | $ | 4,422 | $ | 19,181 | $ | 7,971 | ||||||||
Company’s share of net income | $ | 4,344 | $ | 2,052 | $ | 8,667 | $ | 3,651 | (2) | |||||||
Basis differential (2) | (1,236 | ) | 182 | (2,475 | ) | 374 | ||||||||||
Income from unconsolidated joint ventures | $ | 3,108 | $ | 2,234 | $ | 6,192 | $ | 4,025 |
(1) | Includes straight-line rent adjustments of approximately $4.3 million and $3.6 million for the three months ended June 30, 2017 and 2016, respectively and $11.3 million and $5.8 million for the six months ended June 30, 2017 and 2016, respectively. |
(2) | Includes straight-line rent adjustments of approximately $0.8 million and $1.5 million for the three and six months ended June 30, 2017, respectively, and net above-/below-market rent adjustments of approximately $0.4 million and $0.9 million for the three and six months ended June 30, 2017, respectively. |
Derivative Instrument | Aggregate Notional Amount | Effective Date | Maturity Date | Strike Rate Range | Balance Sheet Location | Fair Value | ||||||||||||||
Low | High | |||||||||||||||||||
Interest Rate Swaps | $ | 350,000 | June 7, 2017 | June 7, 2027 | 2.418 | % | - | 2.950 | % | Other Liabilities | $ | (8,773 | ) | |||||||
Interest Rate Swaps | 100,000 | June 7, 2017 | June 7, 2027 | 2.336 | % | - | 2.388 | % | Prepaid Expenses and Other Assets | 509 | ||||||||||
$ | 450,000 | $ | (8,264 | ) |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
(in thousands) | ||||||||||||||||
Amount of loss related to the effective portion recognized in other comprehensive loss | $ | (6,313 | ) | $ | (32,351 | ) | $ | (6,133 | ) | $ | (90,997 | ) | ||||
Amount of loss related to the effective portion subsequently reclassified to earnings | $ | (1,397 | ) | $ | (628 | ) | $ | (2,703 | ) | $ | (1,255 | ) | ||||
Amount of loss related to the ineffective portion and amount excluded from effectiveness testing | $ | — | $ | — | $ | — | $ | — |
Balance at December 31, 2016 | $ | (52,251 | ) | |
Effective portion of interest rate contracts | (6,133 | ) | ||
Amortization of interest rate contracts | 2,703 | |||
Other comprehensive loss attributable to noncontrolling interests | 2,520 | |||
Balance at June 30, 2017 | $ | (53,161 | ) | |
Balance at December 31, 2015 | $ | (14,114 | ) | |
Effective portion of interest rate contracts | (90,997 | ) | ||
Amortization of interest rate contracts | 1,255 | |||
Other comprehensive loss attributable to noncontrolling interests | 24,108 | |||
Balance at June 30, 2016 | $ | (79,748 | ) |
Balance at December 31, 2016 | $ | (60,853 | ) | |
Effective portion of interest rate contracts | (6,133 | ) | ||
Amortization of interest rate contracts | 2,703 | |||
Other comprehensive loss attributable to noncontrolling interests | 2,416 | |||
Balance at June 30, 2017 | $ | (61,867 | ) | |
Balance at December 31, 2015 | $ | (18,337 | ) | |
Effective portion of interest rate contracts | (90,997 | ) | ||
Amortization of interest rate contracts | 1,255 | |||
Other comprehensive loss attributable to noncontrolling interests | 16,547 | |||
Balance at June 30, 2016 | $ | (91,532 | ) |
Record Date | Payment Date | Distributions per OP Unit and LTIP Unit | Distributions per MYLTIP Unit | |||||||
June 30, 2017 | July 31, 2017 | $0.75 | $0.075 | |||||||
March 31, 2017 | April 28, 2017 | $0.75 | $0.075 | |||||||
December 31, 2016 | January 30, 2017 | $0.75 | $0.075 |
Balance at December 31, 2016 | $ | 2,262,040 | |
Contributions | 31,532 | ||
Net income | 26,933 | ||
Distributions | (26,977 | ) | |
Conversion of redeemable partnership units | (16,422 | ) | |
Unearned compensation | (12,344 | ) | |
Cumulative effect of a change in accounting principle | (1,763 | ) | |
Accumulated other comprehensive loss | (104 | ) | |
Adjustment to reflect redeemable partnership units at redemption value | (92,740 | ) | |
Balance at June 30, 2017 | $ | 2,170,155 | |
Balance at December 31, 2015 | $ | 2,286,689 | |
Contributions | 31,494 | ||
Net income | 32,771 | ||
Distributions | (23,713 | ) | |
Conversion of redeemable partnership units | (2,664 | ) | |
Unearned compensation | (16,617 | ) | |
Accumulated other comprehensive loss | (7,561 | ) | |
Adjustment to reflect redeemable partnership units at redemption value | 86,626 | ||
Balance at June 30, 2016 | $ | 2,387,025 |
Balance at December 31, 2016 | $ | 1,530,647 | |
Capital contributions (1) | 133,072 | ||
Net income | 19,627 | ||
Accumulated other comprehensive loss | (2,416 | ) | |
Distributions | (26,949 | ) | |
Balance at June 30, 2017 | $ | 1,653,981 | |
Balance at December 31, 2015 | $ | 1,574,400 | |
Capital contributions | 3,720 | ||
Net income | 17,278 | ||
Accumulated other comprehensive loss | (16,547 | ) | |
Distributions | (25,914 | ) | |
Balance at June 30, 2016 | $ | 1,552,937 |
(1) | Includes the contribution of the remaining unpaid principal balance of the members’ notes payable totaling $109,576 to equity in the consolidated entity that owns 767 Fifth Avenue (the General Motors Building). |
Record Date | Payment Date | Dividend (Per Share) | Distribution (Per Unit) | |||||||
June 30, 2017 | July 31, 2017 | $0.75 | $0.75 | |||||||
March 31, 2017 | April 28, 2017 | $0.75 | $0.75 | |||||||
December 31, 2016 | January 30, 2017 | $0.75 | $0.75 |
Record Date | Payment Date | Dividend (Per Share) | ||||
August 4, 2017 | August 15, 2017 | $32.8125 | ||||
May 5, 2017 | May 15, 2017 | $32.8125 | ||||
February 3, 2017 | February 15, 2017 | $32.8125 |
Three Months Ended June 30, 2017 | ||||||||||
Income (Numerator) | Shares (Denominator) | Per Share Amount | ||||||||
(in thousands, except for per share amounts) | ||||||||||
Basic Earnings: | ||||||||||
Net income attributable to Boston Properties, Inc. common shareholders | $ | 133,709 | 154,177 | $ | 0.87 | |||||
Allocation of undistributed earnings to participating securities | (43 | ) | — | — | ||||||
Net income attributable to Boston Properties, Inc. common shareholders | $ | 133,666 | 154,177 | $ | 0.87 | |||||
Effect of Dilutive Securities: | ||||||||||
Stock Based Compensation | — | 154 | — | |||||||
Diluted Earnings: | ||||||||||
Net income attributable to Boston Properties, Inc. common shareholders | $ | 133,666 | 154,331 | $ | 0.87 | |||||
Three Months Ended June 30, 2016 | ||||||||||
Income (Numerator) | Shares (Denominator) | Per Share Amount | ||||||||
(in thousands, except for per share amounts) | ||||||||||
Basic Earnings: | ||||||||||
Net income attributable to Boston Properties, Inc. common shareholders | $ | 96,597 | 153,662 | $ | 0.63 | |||||
Effect of Dilutive Securities: | ||||||||||
Stock Based Compensation | — | 198 | — | |||||||
Diluted Earnings: | ||||||||||
Net income attributable to Boston Properties, Inc. common shareholders | $ | 96,597 | 153,860 | $ | 0.63 | |||||
Six Months Ended June 30, 2017 | ||||||||||
Income (Numerator) | Shares (Denominator) | Per Share Amount | ||||||||
(in thousands, except for per share amounts) | ||||||||||
Basic Earnings: | ||||||||||
Net income attributable to Boston Properties, Inc. common shareholders | $ | 230,764 | 154,019 | $ | 1.50 | |||||
Allocation of undistributed earnings to participating securities | (9 | ) | — | — | ||||||
Net income attributable to Boston Properties, Inc. common shareholders | $ | 230,755 | 154,019 | $ | 1.50 | |||||
Effect of Dilutive Securities: | ||||||||||
Stock Based Compensation | — | 254 | — | |||||||
Diluted Earnings: | ||||||||||
Net income attributable to Boston Properties, Inc. common shareholders | $ | 230,755 | 154,273 | $ | 1.50 | |||||
Six Months Ended June 30, 2016 | ||||||||||
Income (Numerator) | Shares (Denominator) | Per Share Amount | ||||||||
(in thousands, except for per share amounts) | ||||||||||
Basic Earnings: | ||||||||||
Net income attributable to Boston Properties, Inc. common shareholders | $ | 278,323 | 153,644 | $ | 1.81 | |||||
Allocation of undistributed earnings to participating securities | (241 | ) | — | — | ||||||
Net income attributable to Boston Properties, Inc. common shareholders | $ | 278,082 | 153,644 | $ | 1.81 | |||||
Effect of Dilutive Securities: | ||||||||||
Stock Based Compensation | — | 245 | — | |||||||
Diluted Earnings: | ||||||||||
Net income attributable to Boston Properties, Inc. common shareholders | $ | 278,082 | 153,889 | $ | 1.81 |
Three Months Ended June 30, 2017 | ||||||||||
Income (Numerator) | Units (Denominator) | Per Unit Amount | ||||||||
(in thousands, except for per unit amounts) | ||||||||||
Basic Earnings: | ||||||||||
Net income attributable to Boston Properties Limited Partnership common unitholders | $ | 151,844 | 171,675 | $ | 0.88 | |||||
Allocation of undistributed earnings to participating securities | (48 | ) | — | — | ||||||
Net income attributable to Boston Properties Limited Partnership common unitholders | $ | 151,796 | 171,675 | $ | 0.88 | |||||
Effect of Dilutive Securities: | ||||||||||
Stock Based Compensation | — | 154 | — | |||||||
Diluted Earnings: | ||||||||||
Net income attributable to Boston Properties Limited Partnership common unitholders | $ | 151,796 | 171,829 | $ | 0.88 |
Three Months Ended June 30, 2016 | ||||||||||
Income (Numerator) | Units (Denominator) | Per Unit Amount | ||||||||
(in thousands, except for per unit amounts) | ||||||||||
Basic Earnings: | ||||||||||
Net income attributable to Boston Properties Limited Partnership common unitholders | $ | 109,938 | 171,370 | $ | 0.64 | |||||
Effect of Dilutive Securities: | ||||||||||
Stock Based Compensation | — | 198 | — | |||||||
Diluted Earnings: | ||||||||||
Net income attributable to Boston Properties Limited Partnership common unitholders | $ | 109,938 | 171,568 | $ | 0.64 | |||||
Six Months Ended June 30, 2017 | ||||||||||
Income (Numerator) | Units (Denominator) | Per Unit Amount | ||||||||
(in thousands, except for per unit amounts) | ||||||||||
Basic Earnings: | ||||||||||
Net income attributable to Boston Properties Limited Partnership common unitholders | $ | 262,506 | 171,628 | $ | 1.53 | |||||
Allocation of undistributed earnings to participating securities | (10 | ) | — | — | ||||||
Net income attributable to Boston Properties Limited Partnership common unitholders | $ | 262,496 | 171,628 | $ | 1.53 | |||||
Effect of Dilutive Securities: | ||||||||||
Stock Based Compensation | — | 254 | — | |||||||
Diluted Earnings: | ||||||||||
Net income attributable to Boston Properties Limited Partnership common unitholders | $ | 262,496 | 171,882 | $ | 1.53 | |||||
Six Months Ended June 30, 2016 | ||||||||||
Income (Numerator) | Units (Denominator) | Per Unit Amount | ||||||||
(in thousands, except for per unit amounts) | ||||||||||
Basic Earnings: | ||||||||||
Net income attributable to Boston Properties Limited Partnership common unitholders | $ | 317,234 | 171,339 | $ | 1.85 | |||||
Allocation of undistributed earnings to participating securities | (269 | ) | — | — | ||||||
Net income attributable to Boston Properties Limited Partnership common unitholders | $ | 316,965 | 171,339 | $ | 1.85 | |||||
Effect of Dilutive Securities: | ||||||||||
Stock Based Compensation | — | 245 | — | |||||||
Diluted Earnings: | ||||||||||
Net income attributable to Boston Properties Limited Partnership common unitholders | $ | 316,965 | 171,584 | $ | 1.85 | |||||
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
(in thousands) | |||||||||||||||
Net income attributable to Boston Properties, Inc. common shareholders | $ | 133,709 | $ | 96,597 | $ | 230,764 | $ | 278,323 | |||||||
Add: | |||||||||||||||
Preferred dividends | 2,625 | 2,589 | 5,250 | 5,207 | |||||||||||
Noncontrolling interest—common units of Boston Properties Limited Partnership | 15,473 | 11,357 | 26,933 | 32,771 | |||||||||||
Noncontrolling interests in property partnerships | 15,203 | 6,814 | 19,627 | 17,278 | |||||||||||
Interest expense | 95,143 | 105,003 | 190,677 | 210,312 | |||||||||||
Depreciation and amortization expense | 151,919 | 153,175 | 311,124 | 312,623 | |||||||||||
Transaction costs | 299 | 913 | 333 | 938 | |||||||||||
General and administrative expense | 27,141 | 25,418 | 58,527 | 54,771 | |||||||||||
Less: | |||||||||||||||
Gains on sales of real estate | 3,767 | — | 3,900 | 67,623 | |||||||||||
Gains from early extinguishments of debt | 14,354 | — | 14,354 | — | |||||||||||
Gains from investments in securities | 730 | 478 | 1,772 | 737 | |||||||||||
Interest and other income | 1,504 | 1,524 | 2,118 | 3,029 | |||||||||||
Income from unconsolidated joint ventures | 3,108 | 2,234 | 6,192 | 4,025 | |||||||||||
Development and management services revenue | 7,365 | 5,533 | 13,837 | 12,222 | |||||||||||
Net Operating Income | $ | 410,684 | $ | 392,097 | $ | 801,062 | $ | 824,587 |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
(in thousands) | |||||||||||||||
Net income attributable to Boston Properties Limited Partnership common unitholders | $ | 151,844 | $ | 109,938 | $ | 262,506 | $ | 317,234 | |||||||
Add: | |||||||||||||||
Preferred distributions | 2,625 | 2,589 | 5,250 | 5,207 | |||||||||||
Noncontrolling interests in property partnerships | 15,203 | 6,814 | 19,627 | 17,278 | |||||||||||
Interest expense | 95,143 | 105,003 | 190,677 | 210,312 | |||||||||||
Depreciation and amortization expense | 149,834 | 151,191 | 306,892 | 308,652 | |||||||||||
Transaction costs | 299 | 913 | 333 | 938 | |||||||||||
General and administrative expense | 27,141 | 25,418 | 58,527 | 54,771 | |||||||||||
Less: | |||||||||||||||
Gains on sales of real estate | 4,344 | — | 4,477 | 69,792 | |||||||||||
Gains from early extinguishments of debt | 14,354 | — | 14,354 | — | |||||||||||
Gains from investments in securities | 730 | 478 | 1,772 | 737 | |||||||||||
Interest and other income | 1,504 | 1,524 | 2,118 | 3,029 | |||||||||||
Income from unconsolidated joint ventures | 3,108 | 2,234 | 6,192 | 4,025 | |||||||||||
Development and management services revenue | 7,365 | 5,533 | 13,837 | 12,222 | |||||||||||
Net Operating Income | $ | 410,684 | $ | 392,097 | $ | 801,062 | $ | 824,587 |
Boston | New York | San Francisco | Washington, DC | Total | |||||||||||||||
Rental Revenue: | |||||||||||||||||||
Office | $ | 191,760 | $ | 251,844 | $ | 85,483 | $ | 102,870 | $ | 631,957 | |||||||||
Residential | 1,153 | — | — | 3,057 | 4,210 | ||||||||||||||
Hotel | 13,375 | — | — | — | 13,375 | ||||||||||||||
Total | 206,288 | 251,844 | 85,483 | 105,927 | 649,542 | ||||||||||||||
% of Grand Totals | 31.76 | % | 38.77 | % | 13.16 | % | 16.31 | % | 100.00 | % | |||||||||
Rental Expenses: | |||||||||||||||||||
Office | 74,160 | 93,110 | 25,938 | 35,611 | 228,819 | ||||||||||||||
Residential | 545 | — | — | 1,090 | 1,635 | ||||||||||||||
Hotel | 8,404 | — | — | — | 8,404 | ||||||||||||||
Total | 83,109 | 93,110 | 25,938 | 36,701 | 238,858 | ||||||||||||||
% of Grand Totals | 34.79 | % | 38.98 | % | 10.86 | % | 15.37 | % | 100.00 | % | |||||||||
Net operating income | $ | 123,179 | $ | 158,734 | $ | 59,545 | $ | 69,226 | $ | 410,684 | |||||||||
% of Grand Totals | 29.99 | % | 38.65 | % | 14.50 | % | 16.86 | % | 100.00 | % |
Boston | New York | San Francisco | Washington, DC | Total | |||||||||||||||
Rental Revenue: | |||||||||||||||||||
Office | $ | 179,048 | $ | 243,957 | $ | 78,524 | $ | 99,588 | $ | 601,117 | |||||||||
Residential | 1,180 | — | — | 2,908 | 4,088 | ||||||||||||||
Hotel | 12,808 | — | — | — | 12,808 | ||||||||||||||
Total | 193,036 | 243,957 | 78,524 | 102,496 | 618,013 | ||||||||||||||
% of Grand Totals | 31.24 | % | 39.47 | % | 12.71 | % | 16.58 | % | 100.00 | % | |||||||||
Rental Expenses: | |||||||||||||||||||
Office | 68,754 | 88,749 | 25,470 | 33,359 | 216,332 | ||||||||||||||
Residential | 513 | — | — | 1,093 | 1,606 | ||||||||||||||
Hotel | 7,978 | — | — | — | 7,978 | ||||||||||||||
Total | 77,245 | 88,749 | 25,470 | 34,452 | 225,916 | ||||||||||||||
% of Grand Totals | 34.19 | % | 39.29 | % | 11.27 | % | 15.25 | % | 100.00 | % | |||||||||
Net operating income | $ | 115,791 | $ | 155,208 | $ | 53,054 | $ | 68,044 | $ | 392,097 | |||||||||
% of Grand Totals | 29.53 | % | 39.59 | % | 13.53 | % | 17.35 | % | 100.00 | % |
Boston | New York | San Francisco | Washington, DC | Total | |||||||||||||||
Rental Revenue: | |||||||||||||||||||
Office | $ | 377,196 | $ | 493,414 | $ | 170,124 | $ | 205,603 | $ | 1,246,337 | |||||||||
Residential | 2,292 | — | — | 5,874 | 8,166 | ||||||||||||||
Hotel | 20,795 | — | — | — | 20,795 | ||||||||||||||
Total | 400,283 | 493,414 | 170,124 | 211,477 | 1,275,298 | ||||||||||||||
% of Grand Totals | 31.39 | % | 38.69 | % | 13.34 | % | 16.58 | % | 100.00 | % | |||||||||
Rental Expenses: | |||||||||||||||||||
Office | 149,416 | 184,794 | 50,412 | 70,933 | 455,555 | ||||||||||||||
Residential | 1,040 | — | — | 2,146 | 3,186 | ||||||||||||||
Hotel | 15,495 | — | — | — | 15,495 | ||||||||||||||
Total | 165,951 | 184,794 | 50,412 | 73,079 | 474,236 | ||||||||||||||
% of Grand Totals | 34.99 | % | 38.97 | % | 10.63 | % | 15.41 | % | 100.00 | % | |||||||||
Net operating income | $ | 234,332 | $ | 308,620 | $ | 119,712 | $ | 138,398 | $ | 801,062 | |||||||||
% of Grand Totals | 29.25 | % | 38.53 | % | 14.94 | % | 17.28 | % | 100.00 | % |
Boston | New York | San Francisco | Washington, DC | Total | |||||||||||||||
Rental Revenue: | |||||||||||||||||||
Office | $ | 356,875 | $ | 535,815 | $ | 154,841 | $ | 200,076 | $ | 1,247,607 | |||||||||
Residential | 2,351 | — | — | 5,786 | 8,137 | ||||||||||||||
Hotel | 21,565 | — | — | — | 21,565 | ||||||||||||||
Total | 380,791 | 535,815 | 154,841 | 205,862 | 1,277,309 | ||||||||||||||
% of Grand Totals | 29.81 | % | 41.95 | % | 12.12 | % | 16.12 | % | 100.00 | % | |||||||||
Rental Expenses: | |||||||||||||||||||
Office | 139,441 | 177,547 | 49,375 | 67,541 | 433,904 | ||||||||||||||
Residential | 1,033 | — | — | 2,173 | 3,206 | ||||||||||||||
Hotel | 15,612 | — | — | — | 15,612 | ||||||||||||||
Total | 156,086 | 177,547 | 49,375 | 69,714 | 452,722 | ||||||||||||||
% of Grand Totals | 34.47 | % | 39.22 | % | 10.91 | % | 15.40 | % | 100.00 | % | |||||||||
Net operating income | $ | 224,705 | $ | 358,268 | $ | 105,466 | $ | 136,148 | $ | 824,587 | |||||||||
% of Grand Totals | 27.25 | % | 43.45 | % | 12.79 | % | 16.51 | % | 100.00 | % |
• | if there is a negative change in the economy, including, without limitation, a reversal of current job growth trends and an increase in unemployment, it could have a negative effect on the following, among other things: |
• | the fundamentals of our business, including overall market occupancy, tenant space utilization and rental rates; |
• | the financial condition of our tenants, many of which are financial, legal, media/telecommunication, technology and other professional firms, our lenders, counterparties to our derivative financial instruments and institutions that hold our cash balances and short-term investments, which may expose us to increased risks of default by these parties; and |
• | the value of our real estate assets, which may limit our ability to dispose of assets at attractive prices or obtain or maintain debt financing secured by our properties or on an unsecured basis; |
• | volatile or adverse global economic and political conditions, and dislocations in the credit markets, could adversely affect 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, tenant space utilization, dependence on tenants’ 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, construction delays, increased construction costs, cost overruns, inability to obtain necessary permits, tenant accounting considerations that may result in negotiated lease provisions that limit a tenant’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 and/or refinance existing indebtedness, including the impact of higher interest rates on the cost and/or availability of financing; |
• | risks associated with forward interest rate contracts and the effectiveness of such arrangements; |
• | risks associated with downturns in the national and local economies, increases in interest rates, and volatility in the securities markets; |
• | 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 security breaches 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 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; |
• | risks associated with our dependence on key personnel whose continued service is not guaranteed; and |
• | the other risk factors identified in our most recently filed Annual Reports on Form 10-K, including those described under the caption “Risk Factors.” |
Three months ended June 30, 2017 | Six months ended June 30, 2017 | |||||||
(Square Feet) | ||||||||
Vacant space available at the beginning of the period | 4,110,657 | 4,196,275 | ||||||
Property dispositions/properties taken out of service | (115,289 | ) | (115,289 | ) | ||||
Properties acquired vacant space | 15,944 | 15,944 | ||||||
Properties placed in-service | 73,258 | 82,738 | ||||||
Leases expiring or terminated during the period | 1,261,949 | 2,105,596 | ||||||
Total space available for lease | 5,346,519 | 6,285,264 | ||||||
1st generation leases | 53,588 | 77,453 | ||||||
2nd generation leases with new tenants | 816,044 | 1,440,469 | ||||||
2nd generation lease renewals | 524,556 | 815,011 | ||||||
Total space leased (1) | 1,394,188 | 2,332,933 | ||||||
Vacant space available for lease at the end of the period | 3,952,331 | 3,952,331 | ||||||
Leases executed during the period, in square feet (2) | 927,257 | 1,492,445 | ||||||
Second generation leasing information: (3) | ||||||||
Leases commencing during the period, in square feet | 1,340,600 | 2,255,480 | ||||||
Weighted Average Lease Term | 103 Months | 96 Months | ||||||
Weighted Average Free Rent Period | 139 Days | 116 Days | ||||||
Total Transaction Costs Per Square Foot (4) | $63.96 | $60.70 | ||||||
Increase in Gross Rents (5) | 17.69 | % | 16.02 | % | ||||
Increase in Net Rents (6) | 28.37 | % | 25.05 | % |
(1) | Represents leases for which rental revenue recognition has commenced in accordance with GAAP during the three and six months ended June 30, 2017. |
(2) | Represents leases executed during the three and six months ended June 30, 2017 for which we either (1) commenced rental revenue recognition in such period or (2) will commence rental revenue recognition in subsequent periods, in accordance with GAAP, and includes leases at properties currently under development. The total square feet of leases executed and recognized in the three and six months ended June 30, 2017 is 269,881 and 409,616, respectively. |
(3) | Second generation leases are defined as leases for space that had previously been leased by us. Of the 1,340,600 and 2,255,480 square feet of second generation leases that commenced during the three and six months ended June 30, 2017, respectively, leases for 1,070,719 and 1,845,864 square feet were signed in prior periods. |
(4) | Total transaction costs include tenant improvements and leasing commissions and exclude free rent concessions and other inducements in accordance with GAAP. |
(5) | Represents the increase in gross rent (base rent plus expense reimbursements) on the new versus expired leases on the 1,026,480 and 1,636,104 square feet of second generation leases that had been occupied within the prior 12 months for the three and six months ended June 30, 2017, respectively; excludes leases that management considers temporary because the tenant is not expected to occupy the space on a long-term basis. |
(6) | Represents the increase in net rent (gross rent less operating expenses) on the new versus expired leases on the 1,026,480 and 1,636,104 square feet of second generation leases that had been occupied within the prior 12 months for the three and six months ended June 30, 2017, respectively; excludes leases that management considers temporary because the tenant is not expected to occupy the space on a long-term basis. |
• | On April 19, 2017, we completed the sale of an approximately 9.5-acre parcel of land at 30 Shattuck Road located in Andover, Massachusetts for a gross sale price of $5.0 million. Net cash proceeds totaled approximately $5.0 million, resulting in a gain on sale of real estate totaling approximately $3.7 million. |
• | On April 24, 2017, BPLP entered into the 2017 Credit Facility. Among other things, the 2017 Credit Facility (1) increased the total commitment of the Revolving Facility from $1.0 billion to $1.5 billion, (2) extended the maturity date from July 26, 2018 to April 24, 2022, (3) reduced the per annum variable interest rates, and (4) added a $500.0 million Delayed Draw Facility that permits BPLP to draw until the first anniversary of the closing date. Based on BPLP’s current credit rating, (1) the applicable Eurocurrency margins for the Revolving Facility and Delayed Draw Facility are 87.5 basis points and 95 basis points, respectively, and (2) the facility fee on the Revolving Facility commitment is 0.15% per annum. The Delayed Draw Facility has a fee on unused commitments equal to 0.15% per annum (See Note 5 to the Consolidated Financial Statements). |
• | On April 6, 2017, we commenced the development of 145 Broadway, a build-to-suit Class A office project with approximately 485,000 net rentable square feet located in Cambridge, Massachusetts. The property is 98% leased. |
• | On May 15, 2017, we acquired 103 Carnegie Center located in Princeton, New Jersey for a purchase price of approximately $15.8 million in cash. 103 Carnegie Center is an approximately 96,000 net rentable square foot Class A office property. The property is 83% leased. |
• | On May 27, 2017, we completed and fully placed in-service Reservoir Place North, a Class A office redevelopment project with approximately 73,000 net rentable square feet located in Waltham, Massachusetts. The property is 0% leased. |
• | On June 2, 2017, BXP renewed its “at the market” (“ATM”) stock offering program through which it may sell from time to time up to an aggregate of $600.0 million of its common stock through sales agents over a three-year period. This program replaces BXP’s prior $600.0 million ATM stock offering program that was scheduled to expire on June 3, 2017. BXP intends to use the net proceeds from any offering for general business purposes, which may include investment opportunities and debt reduction. No shares of common stock have been issued under this ATM stock offering program. |
• | On June 7, 2017, our consolidated entity in which we have a 60% ownership interest and that owns 767 Fifth Avenue (the General Motors Building) located in New York City completed the refinancing of approximately $1.6 billion of indebtedness that had been secured by direct and indirect interests in 767 Fifth Avenue. The new mortgage financing has a principal amount of $2.3 billion, bears interest at a fixed interest rate of 3.43% per annum and matures on June 9, 2027. The loan requires interest-only payments during the 10-year term of the loan, with the entire principal amount due at maturity. The extinguished debt bore interest at a weighted-average rate of approximately 5.96% per annum, an effective GAAP interest rate of approximately 3.03% per annum and was scheduled to mature on October 7, 2017. There was no prepayment penalty associated with the repayment of the prior indebtedness. We recognized a net gain from early extinguishment of debt totaling approximately $14.6 million primarily consisting of the acceleration of the remaining balance related to the historical fair value debt adjustment. On April 24, 2017, our consolidated entity entered into an interest rate lock and commitment agreement for the financing. In conjunction with the interest rate lock and commitment agreement, the consolidated entity terminated its forward-starting interest rate swap contracts with notional |
• | On June 13, 2017, we completed the sale of 40 Shattuck Road located in Andover, Massachusetts for a gross sale price of $12.0 million. Net cash proceeds totaled approximately $11.9 million, resulting in a gain on sale of real estate totaling approximately $28,000 for BXP and approximately $0.6 million for BPLP. 40 Shattuck Road is an approximately 122,000 net rentable square foot Class A office property. The property is 71% leased. |
• | On June 29, 2017, we executed a 99-year ground lease (including extension options), with the right to purchase prior to 10 years after stabilization of the development project as defined in the lease, land adjacent to the MacArthur BART station located in Oakland, California. We have commenced development of a 402-unit residential building and supporting retail space on the site. |
• | On July 26, 2017, a joint venture between us and The Bernstein Companies entered into a build-to-suit lease agreement with an affiliate of Marriott International, Inc. under which Marriott will lease 100% of an approximately 720,000 square foot office building and below-grade parking garage to be constructed by the joint venture at 7750 Wisconsin Avenue in Bethesda, Maryland. The joint venture will lease the office building to Marriott for 20 years on a net basis and will serve as Marriott’s world-wide headquarters. We and The Bernstein Companies will each own a 50% interest in the joint venture. We will serve as development manager for the venture and expect to commence construction in 2018. Marriott has agreed to fund 100% of the related tenant improvement costs and leasing commissions for the office building. |
• | On July 28, 2017, a joint venture in which we have a 50% interest obtained mortgage financing collateralized by its Colorado Center property totaling $550.0 million. The mortgage financing bears interest at a fixed rate of 3.56% per annum and matures on August 9, 2027. The loan requires interest-only payments during the 10-year term of the loan, with the entire principal amount due at maturity. Colorado Center is a six-building office complex that sits on a 15-acre site and contains an aggregate of approximately 1,184,000 net rentable square feet with an underground parking garage for 3,100 vehicles located in Santa Monica, California. |
Total Property Portfolio | |||||||||||||||
2017 | 2016 | Increase/ (Decrease) | % Change | ||||||||||||
Net Income Attributable to Boston Properties, Inc. Common Shareholders | $ | 230,764 | $ | 278,323 | $ | (47,559 | ) | (17.09 | )% | ||||||
Preferred dividends | 5,250 | 5,207 | 43 | 0.83 | % | ||||||||||
Net Income Attributable to Boston Properties, Inc. | 236,014 | 283,530 | (47,516 | ) | (16.76 | )% | |||||||||
Net Income Attributable to Noncontrolling Interests: | |||||||||||||||
Noncontrolling interest—common units of the Operating Partnership | 26,933 | 32,771 | (5,838 | ) | (17.81 | )% | |||||||||
Noncontrolling interests in property partnerships | 19,627 | 17,278 | 2,349 | 13.60 | % | ||||||||||
Net Income | 282,574 | 333,579 | (51,005 | ) | (15.29 | )% | |||||||||
Gains on sales of real estate | 3,900 | 67,623 | (63,723 | ) | (94.23 | )% | |||||||||
Income Before Gains on Sales of Real Estate | 278,674 | 265,956 | 12,718 | 4.78 | % | ||||||||||
Other Expenses: | |||||||||||||||
Add: | |||||||||||||||
Interest expense | 190,677 | 210,312 | (19,635 | ) | (9.34 | )% | |||||||||
Other Income: | |||||||||||||||
Less: | |||||||||||||||
Gains from early extinguishments of debt | 14,354 | — | 14,354 | 100.00 | % | ||||||||||
Gains from investments in securities | 1,772 | 737 | 1,035 | 140.43 | % | ||||||||||
Interest and other income | 2,118 | 3,029 | (911 | ) | (30.08 | )% | |||||||||
Income from unconsolidated joint ventures | 6,192 | 4,025 | 2,167 | 53.84 | % | ||||||||||
Operating Income | 444,915 | 468,477 | (23,562 | ) | (5.03 | )% | |||||||||
Other Expenses: | |||||||||||||||
Add: | |||||||||||||||
Depreciation and amortization expense | 311,124 | 312,623 | (1,499 | ) | (0.48 | )% | |||||||||
Transaction costs | 333 | 938 | (605 | ) | (64.50 | )% | |||||||||
General and administrative expense | 58,527 | 54,771 | 3,756 | 6.86 | % | ||||||||||
Other Revenue: | |||||||||||||||
Less: | |||||||||||||||
Development and management services revenue | 13,837 | 12,222 | 1,615 | 13.21 | % | ||||||||||
Net Operating Income | $ | 801,062 | $ | 824,587 | $ | (23,525 | ) | (2.85 | )% |
Total Property Portfolio | |||||||||||||||
2017 | 2016 | Increase/ (Decrease) | % Change | ||||||||||||
Net Income Attributable to Boston Properties Limited Partnership Common Unitholders | $ | 262,506 | $ | 317,234 | $ | (54,728 | ) | (17.25 | )% | ||||||
Preferred distributions | 5,250 | 5,207 | 43 | 0.83 | % | ||||||||||
Net Income Attributable to Boston Properties Limited Partnership | 267,756 | 322,441 | (54,685 | ) | (16.96 | )% | |||||||||
Net Income Attributable to Noncontrolling Interests: | |||||||||||||||
Noncontrolling interests in property partnerships | 19,627 | 17,278 | 2,349 | 13.60 | % | ||||||||||
Net Income | 287,383 | 339,719 | (52,336 | ) | (15.41 | )% | |||||||||
Gains on sales of real estate | 4,477 | 69,792 | (65,315 | ) | (93.59 | )% | |||||||||
Income Before Gains on Sales of Real Estate | 282,906 | 269,927 | 12,979 | 4.81 | % | ||||||||||
Other Expenses: | |||||||||||||||
Add: | |||||||||||||||
Interest expense | 190,677 | 210,312 | (19,635 | ) | (9.34 | )% | |||||||||
Other Income: | |||||||||||||||
Less: | |||||||||||||||
Gains from early extinguishments of debt | 14,354 | — | 14,354 | 100.00 | % | ||||||||||
Gains from investments in securities | 1,772 | 737 | 1,035 | 140.43 | % | ||||||||||
Interest and other income | 2,118 | 3,029 | (911 | ) | (30.08 | )% | |||||||||
Income from unconsolidated joint ventures | 6,192 | 4,025 | 2,167 | 53.84 | % | ||||||||||
Operating Income | 449,147 | 472,448 | (23,301 | ) | (4.93 | )% | |||||||||
Other Expenses: | |||||||||||||||
Add: | |||||||||||||||
Depreciation and amortization expense | 306,892 | 308,652 | (1,760 | ) | (0.57 | )% | |||||||||
Transaction costs | 333 | 938 | (605 | ) | (64.50 | )% | |||||||||
General and administrative expense | 58,527 | 54,771 | 3,756 | 6.86 | % | ||||||||||
Other Revenue: | |||||||||||||||
Less: | |||||||||||||||
Development and management services revenue | 13,837 | 12,222 | 1,615 | 13.21 | % | ||||||||||
Net Operating Income | $ | 801,062 | $ | 824,587 | $ | (23,525 | ) | (2.85 | )% |
Same Property Portfolio | Properties Placed In-Service Portfolio | Properties Acquired Portfolio | Properties in Development or Redevelopment Portfolio | Properties Sold Portfolio | Total Property Portfolio | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(dollars in thousands) | 2017 | 2016 | Increase/ (Decrease) | % Change | 2017 | 2016 | 2017 | 2016 | 2017 | 2016 | 2017 | 2016 | 2017 | 2016 | Increase/ (Decrease) | % Change | |||||||||||||||||||||||||||||||||||||||||||||
Rental Revenue: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Rental Revenue | $ | 1,189,467 | $ | 1,152,132 | $ | 37,335 | 3.24 | % | $ | 32,536 | $ | 17,654 | $ | 3,321 | $ | 1,092 | $ | 2,648 | $ | 14,987 | $ | 846 | $ | 2,782 | $ | 1,228,818 | $ | 1,188,647 | $ | 40,171 | 3.38 | % | |||||||||||||||||||||||||||||
Termination Income | 18,991 | 58,846 | (39,855 | ) | (67.73 | )% | — | — | — | — | (1,472 | ) | 114 | — | — | 17,519 | 58,960 | (41,441 | ) | (70.29 | )% | ||||||||||||||||||||||||||||||||||||||||
Total Rental Revenue | 1,208,458 | 1,210,978 | (2,520 | ) | (0.21 | )% | 32,536 | 17,654 | 3,321 | 1,092 | 1,176 | 15,101 | 846 | 2,782 | 1,246,337 | 1,247,607 | (1,270 | ) | (0.10 | )% | |||||||||||||||||||||||||||||||||||||||||
Real Estate Operating Expenses | 436,730 | 422,204 | 14,526 | 3.44 | % | 9,347 | 4,381 | 757 | 284 | 8,108 | 5,915 | 613 | 1,120 | 455,555 | 433,904 | 21,651 | 4.99 | % | |||||||||||||||||||||||||||||||||||||||||||
Net Operating Income (Loss), excluding residential and hotel | 771,728 | 788,774 | (17,046 | ) | (2.16 | )% | 23,189 | 13,273 | 2,564 | 808 | (6,932 | ) | 9,186 | 233 | 1,662 | 790,782 | 813,703 | (22,921 | ) | (2.82 | )% | ||||||||||||||||||||||||||||||||||||||||
Residential Net Operating Income (1) | 4,980 | 4,931 | 49 | 0.99 | % | — | — | — | — | — | — | — | — | 4,980 | 4,931 | 49 | 0.99 | % | |||||||||||||||||||||||||||||||||||||||||||
Hotel Net Operating Income (1) | 5,300 | 5,953 | (653 | ) | (10.97 | )% | — | — | — | — | — | — | — | — | 5,300 | 5,953 | (653 | ) | (10.97 | )% | |||||||||||||||||||||||||||||||||||||||||
Net Operating Income (Loss) (1) | $ | 782,008 | $ | 799,658 | $ | (17,650 | ) | (2.21 | )% | $ | 23,189 | $ | 13,273 | $ | 2,564 | $ | 808 | $ | (6,932 | ) | $ | 9,186 | $ | 233 | $ | 1,662 | $ | 801,062 | $ | 824,587 | $ | (23,525 | ) | (2.85 | )% |
(1) | For a detailed discussion of NOI, including the reasons management believes NOI is useful to investors, see page 48. Residential Net Operating Income for the six months ended June 30, 2017 and 2016 is comprised of Residential Revenue of $8,166 and $8,137, less Residential Expenses of $3,186 and $3,206, respectively. Hotel Net Operating Income for the six months ended June 30, 2017 and 2016 is comprised of Hotel Revenue of $20,795 and $21,565 less Hotel Expenses of $15,495 and $15,612, respectively, per the Consolidated Statements of Operations. |
Quarter Initially Placed In-Service | Quarter Fully Placed In-Service | Rental Revenue | Real Estate Operating Expenses | ||||||||||||||||||||||||||||
Name | Square Feet | 2017 | 2016 | Change | 2017 | 2016 | Change | ||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||
601 Massachusetts Avenue | Third Quarter, 2015 | Second Quarter, 2016 | 478,751 | $ | 18,306 | $ | 16,300 | $ | 2,006 | $ | 4,555 | $ | 3,630 | $ | 925 | ||||||||||||||||
804 Carnegie Center | Second Quarter, 2016 | Second Quarter, 2016 | 130,000 | 2,796 | 1,163 | 1,633 | 709 | 702 | 7 | ||||||||||||||||||||||
10 CityPoint | Second Quarter, 2016 | Second Quarter, 2016 | 241,460 | 5,546 | 191 | 5,355 | 1,575 | 49 | 1,526 | ||||||||||||||||||||||
Reservoir Place North | Second Quarter, 2016 | Second Quarter, 2017 | 73,258 | — | — | — | 122 | — | 122 | ||||||||||||||||||||||
888 Boylston Street | Third Quarter, 2016 | N/A | 425,000 | 5,888 | — | 5,888 | 2,386 | — | 2,386 | ||||||||||||||||||||||
1,348,469 | $ | 32,536 | $ | 17,654 | $ | 14,882 | $ | 9,347 | $ | 4,381 | $ | 4,966 |
Rental Revenue | Real Estate Operating Expenses | ||||||||||||||||||||||||||||
Name | Date acquired | Square Feet | 2017 | 2016 | Change | 2017 | 2016 | Change | |||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||
3625-3635 Peterson Way | April 22, 2016 | 218,366 | $ | 2,958 | $ | 1,092 | $ | 1,866 | $ | 582 | $ | 284 | $ | 298 | |||||||||||||||
103 Carnegie Center | May 15, 2017 | 96,332 | 363 | — | 363 | 175 | — | 175 | |||||||||||||||||||||
314,698 | $ | 3,321 | $ | 1,092 | $ | 2,229 | $ | 757 | $ | 284 | $ | 473 |
Rental Revenue | Real Estate Operating Expenses | ||||||||||||||||||||||||||||
Name | Date commenced development / redevelopment | Square Feet | 2017 | 2016 | Change | 2017 | 2016 | Change | |||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||
One Five Nine East 53rd Street (1) | August 19, 2016 | 220,000 | $ | 434 | $ | 10,601 | $ | (10,167 | ) | $ | 4,358 | $ | 3,969 | $ | 389 | ||||||||||||||
191 Spring Street (2) | December 29, 2016 | 160,000 | — | 2,455 | (2,455 | ) | 2,588 | 1,029 | 1,559 | ||||||||||||||||||||
145 Broadway (3) | April 6, 2017 | 79,616 | 742 | 2,045 | (1,303 | ) | 1,162 | 917 | 245 | ||||||||||||||||||||
459,616 | $ | 1,176 | $ | 15,101 | $ | (13,925 | ) | $ | 8,108 | $ | 5,915 | $ | 2,193 |
(1) | This is the low-rise portion of 601 Lexington Avenue in New York City. Rental revenue includes termination income of approximately $(1.5) million and $0.1 million for the six months ended June 30, 2017 and 2016, respectively. In addition, real estate operating expense for the six months ended June 30, 2017 includes approximately $3.6 million of demolition costs. |
(2) | Real estate operating expenses for the six months ended June 30, 2017 includes approximately $2.6 million of demolition costs. |
(3) | On April 6, 2017, we commenced the development of 145 Broadway, a build-to-suit Class A office project with approximately 485,000 net rentable square feet located in Cambridge, Massachusetts. Real estate operating expenses for the six months ended June 30, 2017 includes approximately $0.8 million of demolition costs. |
Rental Revenue | Real Estate Operating Expenses | ||||||||||||||||||||||||||||||||
Name | Date Sold | Property Type | Square Feet | 2017 | 2016 | Change | 2017 | 2016 | Change | ||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||||
415 Main Street | February 1, 2016 | Office | 231,000 | $ | — | $ | 1,675 | $ | (1,675 | ) | $ | — | $ | 412 | $ | (412 | ) | ||||||||||||||||
30 Shattuck Road | April 19, 2017 | Land | N/A | — | — | — | 14 | 23 | (9 | ) | |||||||||||||||||||||||
40 Shattuck Road | June 13, 2017 | Office | 122,000 | 846 | 1,107 | (261 | ) | 599 | 685 | (86 | ) | ||||||||||||||||||||||
353,000 | $ | 846 | — | $ | 2,782 | — | $ | (1,936 | ) | $ | 613 | $ | 1,120 | $ | (507 | ) |
The Lofts at Atlantic Wharf | The Avant at Reston Town Center | |||||||||||||||||||||
2017 | 2016 | Percentage Change | 2017 | 2016 | Percentage Change | |||||||||||||||||
Average Monthly Rental Rate (1) | $ | 4,224 | $ | 4,153 | 1.7 | % | $ | 2,378 | $ | 2,347 | 1.3 | % | ||||||||||
Average Rental Rate Per Occupied Square Foot | $ | 4.69 | $ | 4.57 | 2.6 | % | $ | 2.61 | $ | 2.57 | 1.6 | % | ||||||||||
Average Physical Occupancy (2) | 94.6 | % | 96.1 | % | (1.6 | )% | 92.9 | % | 93.4 | % | (0.5 | )% | ||||||||||
Average Economic Occupancy (3) | 95.3 | % | 97.6 | % | (2.4 | )% | 92.2 | % | 93.3 | % | (1.2 | )% |
(1) | Average Monthly Rental Rate is defined as rental revenue in accordance with GAAP, divided by the weighted monthly average number of occupied units. |
(2) | Average Physical Occupancy is defined as the average number of occupied units divided by the total number of units, expressed as a percentage. |
(3) | Average Economic Occupancy is defined as total possible revenue less vacancy loss as a percentage of total possible revenue. Total possible revenue is determined by valuing average occupied units at contract rates and average vacant units at Market Rents. Vacancy loss is determined by valuing vacant units at current Market Rents. By measuring vacant units at their Market Rents, Average Economic Occupancy takes into account the fact that units of different sizes and locations within a residential property have different economic impacts on a residential property’s total possible gross revenue. Market Rents used by us in calculating Economic Occupancy are based on the current market rates set by the managers of our residential properties based on their experience in renting their residential property’s units and publicly available market data. Trends in market rents for a region as reported by others could vary. Market Rents for a period are based on the average Market Rents during that period and do not reflect any impact for cash concessions. |
2017 | 2016 | Percentage Change | |||||||||
Occupancy | 76.3 | % | 79.7 | % | (4.3 | )% | |||||
Average daily rate | $ | 268.01 | $ | 263.61 | 1.7 | % | |||||
Revenue per available room, REVPAR | $ | 204.37 | $ | 210.21 | (2.8 | )% |
Depreciation and Amortization Expense for the six months ended June 30, | ||||||||||||
2017 | 2016 | Change | ||||||||||
(in thousands) | ||||||||||||
Same Property Portfolio | $ | 299,046 | $ | 306,033 | $ | (6,987 | ) | |||||
Properties Placed in-Service Portfolio | 6,935 | 3,051 | 3,884 | |||||||||
Properties Acquired Portfolio | 1,947 | 746 | 1,201 | |||||||||
Properties in Development or Redevelopment Portfolio | 2,924 | 2,276 | 648 | |||||||||
Properties Sold Portfolio | 272 | 517 | (245 | ) | ||||||||
$ | 311,124 | $ | 312,623 | $ | (1,499 | ) |
Depreciation and Amortization Expense for the six months ended June 30, | ||||||||||||
2017 | 2016 | Change | ||||||||||
(in thousands) | ||||||||||||
Same Property Portfolio | $ | 294,814 | $ | 302,062 | $ | (7,248 | ) | |||||
Properties Placed in-Service Portfolio | 6,935 | 3,051 | 3,884 | |||||||||
Properties Acquired Portfolio | 1,947 | 746 | 1,201 | |||||||||
Properties in Development or Redevelopment Portfolio | 2,924 | 2,276 | 648 | |||||||||
Properties Sold Portfolio | 272 | 517 | (245 | ) | ||||||||
$ | 306,892 | $ | 308,652 | $ | (1,760 | ) |
Component | Change in interest expense for the six months ended June 30, 2017 compared to June 30, 2016 | |||
(in thousands) | ||||
Increases to interest expense due to: | ||||
Issuance of $1.0 billion in aggregate principal of 2.750% senior notes due 2026 on August 17, 2016 | $ | 16,528 | ||
Issuance of $1.0 billion in aggregate principal of 3.650% senior notes due 2026 on January 20, 2016 | 1,951 | |||
Refinancing of the debt collateralized by 767 Fifth Avenue (the General Motors Building) (1) | 1,538 | |||
Utilization of the Unsecured Line of Credit as well as an increase in capacity due to the execution of the 2017 Credit Facility (1) | 1,462 | |||
Amortization of deferred financing fees for BPLP’s unsecured debt and credit facility | 662 | |||
Total increases to interest expense | 22,141 | |||
Decreases to interest expense due to: | ||||
Repayment of mortgage financings (2) | (33,869 | ) | ||
Increase in capitalized interest (3) | (7,460 | ) | ||
Decrease in the interest for the Outside Members’ Notes Payable for the 767 Fifth Avenue (the General Motors Building) (4) | (439 | ) | ||
Other interest expense (excluding senior notes) | (8 | ) | ||
Total decreases to interest expense | (41,776 | ) | ||
Total change in interest expense | $ | (19,635 | ) |
(1) | See Note 5 to the Consolidated Financial Statements. |
(2) | Includes the repayment of the mortgage loans collateralized Fountain Square, Embarcadero Center Four and 599 Lexington Avenue. |
(3) | The increase was primarily due to the commencement and continuation of several development projects. For a list of development projects refer to “Liquidity and Capital Resources” within “Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations.” |
(4) | The related interest expense from the Outside Members’ Notes Payable totaled approximately $16.3 million and $16.7 million for the six months ended June 30, 2017 and 2016, respectively. These amounts are allocated to the outside joint venture partners as an adjustment to Noncontrolling Interests in Property Partnerships in our Consolidated Statements of Operations. On June 7, 2017, a portion of the outside members’ notes payable was repaid and the remaining portion was contributed as equity in the consolidated entity (See Notes 5 and 8 to the Consolidated Financial Statements). |
Name | Date Sold | Property Type | Square Feet | Sale Price | Cash Proceeds | Gain on Sale of Real Estate | |||||||||||||
(dollars in millions) | |||||||||||||||||||
2017 | |||||||||||||||||||
30 Shattuck Road | April 19, 2017 | Land | N/A | $ | 5.0 | $ | 5.0 | $ | 3.7 | ||||||||||
40 Shattuck Road | June 13, 2017 | Office | 122,000 | 12.0 | 11.9 | — | (1) | ||||||||||||
$ | 17.0 | $ | 16.9 | $ | 3.7 | (2) | |||||||||||||
2016 | |||||||||||||||||||
415 Main Street | February 1, 2016 | Office | 231,000 | $ | 105.4 | $ | 104.9 | $ | 60.8 | ||||||||||
$ | 105.4 | $ | 104.9 | $ | 60.8 | (3) |
(1) | The gain on sale of real estate for this property was $28,000. |
(2) | Excludes approximately $0.1 million of a gain on sale of real estate recognized during the six months ended June 30, 2017 related to a previously deferred gain amount from the 2015 sale of the Residences on The Avenue residential property located in Washington, DC. |
(3) | Excludes approximately $6.8 million of a gain on sale of real estate recognized during the six months ended June 30, 2016 related to a previously deferred gain amount from the 2014 sale of Patriots Park located in Reston, Virginia. |
Name | Date Sold | Property Type | Square Feet | Sale Price | Cash Proceeds | Gain on Sale of Real Estate | |||||||||||||
(dollars in millions) | |||||||||||||||||||
2017 | |||||||||||||||||||
30 Shattuck Road | April 19, 2017 | Land | N/A | $ | 5.0 | $ | 5.0 | $ | 3.7 | ||||||||||
40 Shattuck Road | June 13, 2017 | Office | 122,000 | 12.0 | 11.9 | 0.6 | |||||||||||||
$ | 17.0 | $ | 16.9 | $ | 4.3 | (1) | |||||||||||||
2016 | |||||||||||||||||||
415 Main Street | February 1, 2016 | Office | 231,000 | $ | 105.4 | $ | 104.9 | $ | 63.0 | ||||||||||
$ | 105.4 | $ | 104.9 | $ | 63.0 | (2) |
(1) | Excludes approximately $0.1 million of a gain on sale of real estate recognized during the six months ended June 30, 2017 related to a previously deferred gain amount from the 2015 sale of the Residences on The Avenue residential property located in Washington, DC. |
(2) | Excludes approximately $6.8 million of a gain on sale of real estate recognized during the six months ended June 30, 2016 related to a previously deferred gain amount from the 2014 sale of Patriots Park located in Reston, Virginia. |
Property | Noncontrolling Interests in Property Partnerships for the six months ended June 30, | |||||||||||
2017 | 2016 | Change | ||||||||||
(in thousands) | ||||||||||||
Salesforce Tower | $ | (195 | ) | $ | — | $ | (195 | ) | ||||
767 Fifth Avenue (the General Motors Building) (1) | (2,958 | ) | (9,539 | ) | 6,581 | |||||||
Times Square Tower | 13,261 | 13,474 | (213 | ) | ||||||||
601 Lexington Avenue (2) | 3,532 | 6,920 | (3,388 | ) | ||||||||
100 Federal Street | 1,308 | 1,796 | (488 | ) | ||||||||
Atlantic Wharf Office | 4,679 | 4,627 | 52 | |||||||||
$ | 19,627 | $ | 17,278 | $ | 2,349 |
(1) | The net loss allocation is primarily due to the partners’ share of the interest expense for the outside members’ notes payable which was $16.3 million and $16.7 million for the six months ended June 30, 2017 and 2016, respectively. On June 7, 2017, a portion of the outside members’ notes payable was repaid and the remaining portion was contributed as equity in the consolidated entity (See Notes 5 and 8 to the Consolidated Financial Statements). |
(2) | On August 19, 2016, the consolidated entity in which we have a 55% interest and that owns this property commenced the redevelopment of the six-story low-rise office and retail building component of the complex. The redeveloped portion of the low-rise building will contain approximately 195,000 net rentable square feet of Class A office space and approximately 25,000 net rentable square feet of retail space. |
Total Property Portfolio | |||||||||||||||
2017 | 2016 | Increase/ (Decrease) | % Change | ||||||||||||
(in thousands) | |||||||||||||||
Net Income Attributable to Boston Properties, Inc. Common Shareholders | $ | 133,709 | $ | 96,597 | $ | 37,112 | 38.42 | % | |||||||
Preferred dividends | 2,625 | 2,589 | 36 | 1.39 | % | ||||||||||
Net Income Attributable to Boston Properties, Inc. | 136,334 | 99,186 | 37,148 | 37.45 | % | ||||||||||
Net Income Attributable to Noncontrolling Interests: | |||||||||||||||
Noncontrolling interest—common units of Boston Properties Limited Partnership | 15,473 | 11,357 | 4,116 | 36.24 | % | ||||||||||
Noncontrolling interests in property partnerships | 15,203 | 6,814 | 8,389 | 123.11 | % | ||||||||||
Net Income | 167,010 | 117,357 | 49,653 | 42.31 | % | ||||||||||
Gains on sales of real estate | 3,767 | — | 3,767 | 100.00 | % | ||||||||||
Income Before Gains on Sales of Real Estate | 163,243 | 117,357 | 45,886 | 39.10 | % | ||||||||||
Other Expenses: | |||||||||||||||
Add: | |||||||||||||||
Interest expense | 95,143 | 105,003 | (9,860 | ) | (9.39 | )% | |||||||||
Other Income: | |||||||||||||||
Less: | |||||||||||||||
Gains from early extinguishments of debt | 14,354 | — | 14,354 | 100.00 | % | ||||||||||
Gains from investments in securities | 730 | 478 | 252 | 52.72 | % | ||||||||||
Interest and other income | 1,504 | 1,524 | (20 | ) | (1.31 | )% | |||||||||
Income from unconsolidated joint ventures | 3,108 | 2,234 | 874 | 39.12 | % | ||||||||||
Operating Income | 238,690 | 218,124 | 20,566 | 9.43 | % | ||||||||||
Other Expenses: | |||||||||||||||
Add: | |||||||||||||||
Depreciation and amortization expense | 151,919 | 153,175 | (1,256 | ) | (0.82 | )% | |||||||||
Transaction costs | 299 | 913 | (614 | ) | (67.25 | )% | |||||||||
General and administrative expense | 27,141 | 25,418 | 1,723 | 6.78 | % | ||||||||||
Other Revenue: | |||||||||||||||
Less: | |||||||||||||||
Development and management services revenue | 7,365 | 5,533 | 1,832 | 33.11 | % | ||||||||||
Net Operating Income | $ | 410,684 | $ | 392,097 | $ | 18,587 | 4.74 | % |
Total Property Portfolio | |||||||||||||||
2017 | 2016 | Increase/ (Decrease) | % Change | ||||||||||||
(in thousands) | |||||||||||||||
Net Income Attributable to Boston Properties Limited Partnership Common Unitholders | $ | 151,844 | $ | 109,938 | $ | 41,906 | 38.12 | % | |||||||
Preferred distributions | 2,625 | 2,589 | 36 | 1.39 | % | ||||||||||
Net Income Attributable to Boston Properties Limited Partnership | 154,469 | 112,527 | 41,942 | 37.27 | % | ||||||||||
Net Income Attributable to Noncontrolling Interests: | |||||||||||||||
Noncontrolling interests in property partnerships | 15,203 | 6,814 | 8,389 | 123.11 | % | ||||||||||
Net Income | 169,672 | 119,341 | 50,331 | 42.17 | % | ||||||||||
Gains on sales of real estate | 4,344 | — | 4,344 | 100.00 | % | ||||||||||
Income Before Gains on Sales of Real Estate | 165,328 | 119,341 | 45,987 | 38.53 | % | ||||||||||
Other Expenses: | |||||||||||||||
Add: | |||||||||||||||
Interest expense | 95,143 | 105,003 | (9,860 | ) | (9.39 | )% | |||||||||
Other Income: | |||||||||||||||
Less: | |||||||||||||||
Gains from early extinguishments of debt | 14,354 | — | 14,354 | 100.00 | % | ||||||||||
Gains from investments in securities | 730 | 478 | 252 | 52.72 | % | ||||||||||
Interest and other income | 1,504 | 1,524 | (20 | ) | (1.31 | )% | |||||||||
Income from unconsolidated joint ventures | 3,108 | 2,234 | 874 | 39.12 | % | ||||||||||
Operating Income | 240,775 | 220,108 | 20,667 | 9.39 | % | ||||||||||
Other Expenses: | |||||||||||||||
Add: | |||||||||||||||
Depreciation and amortization expense | 149,834 | 151,191 | (1,357 | ) | (0.90 | )% | |||||||||
Transaction costs | 299 | 913 | (614 | ) | (67.25 | )% | |||||||||
General and administrative expense | 27,141 | 25,418 | 1,723 | 6.78 | % | ||||||||||
Other Revenue: | |||||||||||||||
Less: | |||||||||||||||
Development and management services revenue | 7,365 | 5,533 | 1,832 | 33.11 | % | ||||||||||
Net Operating Income | $ | 410,684 | $ | 392,097 | $ | 18,587 | 4.74 | % |
Same Property Portfolio | Properties Placed In-Service Portfolio | Properties Acquired Portfolio | Properties in Development or Redevelopment Portfolio | Properties Sold Portfolio | Total Property Portfolio | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(dollars in thousands) | 2017 | 2016 | Increase/ (Decrease) | % Change | 2017 | 2016 | 2017 | 2016 | 2017 | 2016 | 2017 | 2016 | 2017 | 2016 | Increase/ (Decrease) | % Change | |||||||||||||||||||||||||||||||||||||||||||||
Rental Revenue: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Rental Revenue | $ | 598,697 | $ | 575,007 | $ | 23,690 | 4.12 | % | $ | 16,564 | $ | 9,603 | $ | 1,836 | $ | 1,092 | $ | 900 | $ | 7,309 | $ | 359 | $ | 452 | $ | 618,356 | $ | 593,463 | $ | 24,893 | 4.19 | % | |||||||||||||||||||||||||||||
Termination Income | 13,601 | 7,540 | 6,061 | 80.38 | % | — | — | — | — | — | 114 | — | — | 13,601 | 7,654 | 5,947 | 77.70 | % | |||||||||||||||||||||||||||||||||||||||||||
Total Rental Revenue | 612,298 | 582,547 | 29,751 | 5.11 | % | 16,564 | 9,603 | 1,836 | 1,092 | 900 | 7,423 | 359 | 452 | 631,957 | 601,117 | 30,840 | 5.13 | % | |||||||||||||||||||||||||||||||||||||||||||
Real Estate Operating Expenses | 218,442 | 210,168 | 8,274 | 3.94 | % | 4,771 | 2,597 | 487 | 284 | 4,880 | 2,919 | 239 | 364 | 228,819 | 216,332 | 12,487 | 5.77 | % | |||||||||||||||||||||||||||||||||||||||||||
Net Operating Income (Loss), excluding residential and hotel | 393,856 | 372,379 | 21,477 | 5.77 | % | 11,793 | 7,006 | 1,349 | 808 | (3,980 | ) | 4,504 | 120 | 88 | 403,138 | 384,785 | 18,353 | 4.77 | % | ||||||||||||||||||||||||||||||||||||||||||
Residential Net Operating Income (1) | 2,575 | 2,482 | 93 | 3.75 | % | — | — | — | — | — | — | — | — | 2,575 | 2,482 | 93 | 3.75 | % | |||||||||||||||||||||||||||||||||||||||||||
Hotel Net Operating Income (1) | 4,971 | 4,830 | 141 | 2.92 | % | — | — | — | — | — | — | — | — | 4,971 | 4,830 | 141 | 2.92 | % | |||||||||||||||||||||||||||||||||||||||||||
Net Operating Income (Loss) (1) | $ | 401,402 | $ | 379,691 | $ | 21,711 | 5.72 | % | $ | 11,793 | $ | 7,006 | $ | 1,349 | $ | 808 | $ | (3,980 | ) | $ | 4,504 | $ | 120 | $ | 88 | $ | 410,684 | $ | 392,097 | $ | 18,587 | 4.74 | % |
(1) | For a detailed discussion of NOI, including the reasons management believes NOI is useful to investors, see page 48. Residential Net Operating Income for the three months ended June 30, 2017 and 2016 is comprised of Residential Revenue of $4,210 and $4,088, less Residential Expenses of $1,635 and $1,606, respectively. Hotel Net Operating Income for the three months ended June 30, 2017 and 2016 is comprised of Hotel Revenue of $13,375 and $12,808 less Hotel Expenses of $8,404 and $7,978, respectively, per the Consolidated Statements of Operations. |
Quarter Initially Placed In-Service | Quarter Fully Placed In-Service | Rental Revenue | Real Estate Operating Expenses | ||||||||||||||||||||||||||||
Name | Square Feet | 2017 | 2016 | Change | 2017 | 2016 | Change | ||||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||
601 Massachusetts Avenue | Third Quarter, 2015 | Second Quarter, 2016 | 478,751 | $ | 9,233 | $ | 8,249 | $ | 984 | $ | 2,279 | $ | 1,846 | $ | 433 | ||||||||||||||||
804 Carnegie Center | Second Quarter, 2016 | Second Quarter, 2016 | 130,000 | 1,398 | 1,163 | 235 | 329 | 702 | (373 | ) | |||||||||||||||||||||
10 CityPoint | Second Quarter, 2016 | Second Quarter, 2016 | 241,460 | 2,880 | 191 | 2,689 | 757 | 49 | 708 | ||||||||||||||||||||||
Reservoir Place North | Second Quarter, 2016 | Second Quarter, 2017 | 73,258 | — | — | — | 53 | — | 53 | ||||||||||||||||||||||
888 Boylston Street | Third Quarter, 2016 | N/A | 425,000 | 3,053 | — | 3,053 | 1,353 | — | 1,353 | ||||||||||||||||||||||
1,348,469 | $ | 16,564 | $ | 9,603 | $ | 6,961 | $ | 4,771 | $ | 2,597 | $ | 2,174 |
Rental Revenue | Real Estate Operating Expenses | ||||||||||||||||||||||||||||
Name | Date acquired | Square Feet | 2017 | 2016 | Change | 2017 | 2016 | Change | |||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||
3625-3635 Peterson Way | April 22, 2016 | 218,366 | $ | 1,473 | $ | 1,092 | $ | 381 | $ | 312 | $ | 284 | $ | 28 | |||||||||||||||
103 Carnegie Center | May 25, 2017 | 96,332 | 363 | — | 363 | 175 | — | 175 | |||||||||||||||||||||
314,698 | $ | 1,836 | $ | 1,092 | $ | 744 | $ | 487 | $ | 284 | $ | 203 |
Rental Revenue | Real Estate Operating Expenses | ||||||||||||||||||||||||||||
Name | Date commenced development / redevelopment | Square Feet | 2017 | 2016 | Change | 2017 | 2016 | Change | |||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||
One Five Nine East 53rd Street (1) | August 19, 2016 | 220,000 | $ | 867 | $ | 5,185 | $ | (4,318 | ) | $ | 2,835 | $ | 2,034 | $ | 801 | ||||||||||||||
191 Spring Street (2) | December 29, 2016 | 160,000 | — | 1,265 | (1,265 | ) | 1,213 | 531 | 682 | ||||||||||||||||||||
145 Broadway (3) | April 6, 2017 | 79,616 | 33 | 973 | (940 | ) | 832 | 354 | 478 | ||||||||||||||||||||
459,616 | $ | 900 | $ | 7,423 | $ | (6,523 | ) | $ | 4,880 | $ | 2,919 | $ | 1,961 |
(1) | This is the low-rise portion of 601 Lexington Avenue in New York City. Rental revenue includes approximately $0.1 million of termination income for the three months ended June 30, 2016. In addition, real estate operating expenses for the three months ended June 30, 2017 includes approximately $2.5 million of demolition costs. |
(2) | Real estate operating expenses for the three months ended June 30, 2017 includes approximately $1.2 million of demolition costs. |
(3) | On April 6, 2017, we commenced the development of 145 Broadway, a build-to-suit Class A office project with approximately 485,000 net rentable square feet located in Cambridge, Massachusetts. Real estate operating expenses for the three months ended June 30, 2017 includes approximately $0.8 million of demolition costs. |
Rental Revenue | Real Estate Operating Expenses | ||||||||||||||||||||||||||||||
Name | Date Sold | Property Type | Square Feet | 2017 | 2016 | Change | 2017 | 2016 | Change | ||||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||||
30 Shattuck Road | April 19, 2017 | Land | N/A | $ | — | $ | — | $ | — | $ | 3 | $ | 12 | $ | (9 | ) | |||||||||||||||
40 Shattuck Road | June 13, 2017 | Office | 122,000 | 359 | 452 | (93 | ) | 236 | 352 | (116 | ) | ||||||||||||||||||||
122,000 | $ | 359 | $ | 452 | $ | (93 | ) | $ | 239 | $ | 364 | $ | (125 | ) |
The Lofts at Atlantic Wharf | The Avant at Reston Town Center | |||||||||||||||||||||
2017 | 2016 | Percentage Change | 2017 | 2016 | Percentage Change | |||||||||||||||||
Average Monthly Rental Rate (1) | $ | 4,280 | $ | 4,150 | 3.1 | % | $ | 2,386 | $ | 2,367 | 0.8 | % | ||||||||||
Average Rental Rate Per Occupied Square Foot | $ | 4.71 | $ | 4.59 | 2.6 | % | $ | 2.64 | $ | 2.60 | 1.5 | % | ||||||||||
Average Physical Occupancy (2) | 95.4 | % | 95.4 | % | — | % | 95.9 | % | 94.0 | % | 2.0 | % | ||||||||||
Average Economic Occupancy (3) | 96.9 | % | 96.4 | % | 0.5 | % | 94.5 | % | 93.9 | % | 0.6 | % |
(1) | Average Monthly Rental Rate is defined as rental revenue in accordance with GAAP, divided by the weighted monthly average number of occupied units. |
(2) | Average Physical Occupancy is defined as the average number of occupied units divided by the total number of units, expressed as a percentage. |
(3) | Average Economic Occupancy is defined as total possible revenue less vacancy loss as a percentage of total possible revenue. Total possible revenue is determined by valuing average occupied units at contract rates and average vacant units at Market Rents. Vacancy loss is determined by valuing vacant units at current Market Rents. By measuring vacant units at their Market Rents, Average Economic Occupancy takes into account the fact that units of different sizes and locations within a residential property have different economic impacts on a residential property's total possible gross revenue. Market Rents used by us in calculating Economic Occupancy are based on the current market rates set by the managers of our residential properties based on their experience in renting their residential property’s units and publicly available market data. Trends in market rents for a region as reported by others could vary. Market Rents for a period are based on the average Market Rents during that period and do not reflect any impact for cash concessions. |
2017 | 2016 | Percentage Change | |||||||||
Occupancy | 85.9 | % | 84.3 | % | 1.9 | % | |||||
Average daily rate | $ | 304.82 | $ | 299.42 | 1.8 | % | |||||
Revenue per available room, REVPAR | $ | 261.98 | $ | 252.34 | 3.8 | % |
Depreciation and Amortization Expense for the three months ended June 30, | ||||||||||||
2017 | 2016 | Change | ||||||||||
(in thousands) | ||||||||||||
Same Property Portfolio | $ | 146,549 | $ | 149,247 | $ | (2,698 | ) | |||||
Properties Placed in-Service Portfolio | 3,482 | 1,715 | 1,767 | |||||||||
Properties Acquired Portfolio | 973 | 746 | 227 | |||||||||
Properties in Development or Redevelopment Portfolio | 814 | 1,274 | (460 | ) | ||||||||
Properties Sold Portfolio | 101 | 193 | (92 | ) | ||||||||
$ | 151,919 | $ | 153,175 | $ | (1,256 | ) |
Depreciation and Amortization Expense for the three months ended June 30, | ||||||||||||
2017 | 2016 | Change | ||||||||||
(in thousands) | ||||||||||||
Same Property Portfolio | $ | 144,464 | $ | 147,263 | $ | (2,799 | ) | |||||
Properties Placed in-Service Portfolio | 3,482 | 1,715 | 1,767 | |||||||||
Properties Acquired Portfolio | 973 | 746 | 227 | |||||||||
Properties in Development or Redevelopment Portfolio | 814 | 1,274 | (460 | ) | ||||||||
Properties Sold Portfolio | 101 | 193 | (92 | ) | ||||||||
$ | 149,834 | $ | 151,191 | $ | (1,357 | ) |
Component | Change in interest expense for the three months ended June 30, 2017 compared to June 30, 2016 | |||
(in thousands) | ||||
Increases to interest expense due to: | ||||
Issuance of $1.0 billion in aggregate principal of 2.750% senior notes due 2026 on August 17, 2016 | $ | 8,265 | ||
Refinancing of the debt collateralized by 767 Fifth Avenue (the General Motors Building) (1) | 2,142 | |||
Utilization of the Unsecured Line of Credit as well as an increase in capacity due to the execution of the 2017 Credit Facility (1) | 1,183 | |||
Amortization of deferred financing fees for BPLP’s unsecured debt and credit facility | 402 | |||
Other interest expense (excluding senior notes) | 20 | |||
Total increases to interest expense | 12,012 | |||
Decreases to interest expense due to: | ||||
Repayment of mortgage financings (2) | (16,105 | ) | ||
Increase in capitalized interest (3) | (4,384 | ) | ||
Decrease in the interest for the Outside Members’ Notes Payable for the 767 Fifth Avenue (the General Motors Building) (4) | (1,383 | ) | ||
Total decreases to interest expense | (21,872 | ) | ||
Total change in interest expense | $ | (9,860 | ) |
(1) | See Note 5 to the Consolidated Financial Statements. |
(2) | Includes the repayment of the mortgage loans collateralized by Fountain Square, Embarcadero Center Four and 599 Lexington Avenue. |
(3) | The increase was primarily due to the commencement and continuation of several development projects. For a list of development projects refer to “Liquidity and Capital Resources” within “Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations.” |
(4) | The related interest expense from the Outside Members’ Notes Payable totaled approximately $7.1 million and $8.5 million for the three months ended June 30, 2017 and 2016, respectively. These amounts are allocated to the outside joint venture partners as an adjustment to Noncontrolling Interests in Property Partnerships in our Consolidated Statements of Operations. On June 7, 2017, a portion of the outside members’ notes payable was repaid and the remaining portion was contributed as equity in the consolidated entity (See Notes 5 and 8 to the Consolidated Financial Statements). |
Name | Date Sold | Property Type | Square Feet | Sale Price | Cash Proceeds | Gain on Sale of Real Estate | |||||||||||||
2017 | |||||||||||||||||||
30 Shattuck Road | April 19, 2017 | Land | N/A | $ | 5.0 | $ | 5.0 | $ | 3.7 | ||||||||||
40 Shattuck Road | June 13, 2017 | Office | 122,000 | 12.0 | 11.9 | — | (1) | ||||||||||||
$ | 17.0 | $ | 16.9 | $ | 3.7 |
(1) | The gain on sale of real estate for this property was $28,000. |
Name | Date Sold | Property Type | Square Feet | Sale Price | Cash Proceeds | Gain on Sale of Real Estate | ||||||||||||
2017 | ||||||||||||||||||
30 Shattuck Road | April 19, 2017 | Land | N/A | $ | 5.0 | $ | 5.0 | $ | 3.7 | |||||||||
40 Shattuck Road | June 13, 2017 | Office | 122,000 | 12.0 | 11.9 | 0.6 | ||||||||||||
$ | 17.0 | $ | 16.9 | $ | 4.3 |
Property | Noncontrolling Interests in Property Partnerships for the three months ended June 30, | |||||||||||
2017 | 2016 | Change | ||||||||||
(in thousands) | ||||||||||||
Salesforce Tower | $ | (130 | ) | $ | — | $ | (130 | ) | ||||
767 Fifth Avenue (the General Motors Building) (1) | 3,206 | (4,845 | ) | 8,051 | ||||||||
Times Square Tower | 6,607 | 6,638 | (31 | ) | ||||||||
601 Lexington Avenue (2) | 2,042 | 1,696 | 346 | |||||||||
100 Federal Street | 1,148 | 1,014 | 134 | |||||||||
Atlantic Wharf Office | 2,330 | 2,311 | 19 | |||||||||
$ | 15,203 | $ | 6,814 | $ | 8,389 |
(1) | On June 7, 2017, our consolidated entity in which we have a 60% interest completed the refinancing of indebtedness that had been secured by direct and indirect interests in 767 Fifth Avenue. We recognized a net gain from early extinguishment of debt totaling approximately $14.6 million primarily consisting of the acceleration of the remaining balance related to the historical fair value debt |
(2) | On August 19, 2016, the consolidated entity in which we have a 55% interest and that owns this property commenced the redevelopment of the six-story low-rise office and retail building component of the complex. The redeveloped portion of the low-rise building will contain approximately 195,000 net rentable square feet of Class A office space and approximately 25,000 net rentable square feet of retail space. |
• | fund normal recurring expenses; |
• | meet debt service and principal repayment obligations, including balloon payments on maturing debt; |
• | fund capital expenditures, including major renovations, tenant improvements and leasing costs; |
• | fund development costs; |
• | fund dividend requirements on BXP’s Series B Preferred Stock; |
• | fund possible property acquisitions; and |
• | make the minimum distribution required to enable BXP to maintain its REIT qualification under the Internal Revenue Code of 1986, as amended. |
• | cash flow from operations; |
• | distribution of cash flows from joint ventures; |
• | cash and cash equivalent balances; |
• | issuances of BXP equity securities and/or additional preferred or common units of partnership interest in BPLP; |
• | BPLP’s 2017 Credit Facility and other short-term bridge facilities; |
• | construction loans; |
• | long-term secured and unsecured indebtedness (including unsecured exchangeable indebtedness); and |
• | sales of real estate. |
Construction Properties | Estimated Stabilization Date | Location | # of Buildings | Estimated Square Feet | Investment to Date (1) | Estimated Total Investment (1) | Estimated Future Equity Requirement (1) | Percentage Leased (2) | ||||||||||||||||||
Office and Retail | ||||||||||||||||||||||||||
888 Boylston Street | Fourth Quarter, 2017 | Boston, MA | 1 | 425,000 | $ | 242,516 | $ | 271,500 | $ | 28,984 | 88 | % | (3) | |||||||||||||
Salesforce Tower (95% ownership) | Third Quarter, 2019 | San Francisco, CA | 1 | 1,400,000 | 880,355 | 1,073,500 | 202,514 | 82 | % | (4) | ||||||||||||||||
The Hub on Causeway (50% ownership) | Fourth Quarter, 2019 | Boston, MA | 1 | 385,000 | 38,846 | 141,870 | 103,024 | 42 | % | |||||||||||||||||
145 Broadway | Fourth Quarter, 2019 | Cambridge, MA | 1 | 485,000 | 27,325 | 375,000 | 347,675 | 98 | % | |||||||||||||||||
Dock 72 (50% ownership) | First Quarter, 2020 | Brooklyn, NY | 1 | 670,000 | 57,458 | 204,900 | 22,442 | 33 | % | (5) | ||||||||||||||||
Total Office and Retail Properties under Construction | 5 | 3,365,000 | 1,246,500 | 2,066,770 | 704,639 | 71 | % | |||||||||||||||||||
Residential | ||||||||||||||||||||||||||
Proto at Cambridge (274 units) | Second Quarter, 2019 | Cambridge, MA | 1 | 164,000 | 45,812 | 140,170 | 94,358 | N/A | ||||||||||||||||||
Signature at Reston (508 units) | Second Quarter, 2020 | Reston, VA | 1 | 490,000 | 144,982 | 234,854 | 89,872 | N/A | ||||||||||||||||||
Signature at Reston - Retail | — | 24,600 | — | — | — | 81 | % | |||||||||||||||||||
MacArthur Station Residences (402 units) | Fourth Quarter, 2021 | Oakland, CA | 1 | 324,000 | 1,842 | 263,600 | 261,758 | N/A | (6) | |||||||||||||||||
Total Residential Properties under Construction | 3 | 1,002,600 | 192,636 | 638,624 | 445,988 | 59 | % | (7) | ||||||||||||||||||
Redevelopment Properties | ||||||||||||||||||||||||||
191 Spring Street | Fourth Quarter, 2018 | Lexington, MA | 1 | 160,000 | 14,866 | 53,920 | 39,054 | 49 | % | |||||||||||||||||
One Five Nine East 53rd Street (55% ownership) | Fourth Quarter, 2019 | New York, NY | — | 220,000 | 38,677 | 106,000 | 67,323 | — | % | (8) | ||||||||||||||||
Total Redevelopment Properties under Construction | 1 | 380,000 | 53,543 | 159,920 | 106,377 | 21 | % | |||||||||||||||||||
Total Properties under Construction and Redevelopment | 9 | 4,747,600 | $ | 1,492,679 | $ | 2,865,314 | $ | 1,257,004 | 66 | % | (7) |
(1) | Represents our share. Includes net revenue during lease up period, acquisition expenses and approximately $65.0 million of construction cost and leasing commission accruals. |
(2) | Represents percentage leased as of August 3, 2017, including leases with future commencement dates and excluding residential units. |
(3) | As of June 30, 2017, this property was 31% placed in-service. |
(4) | Under the joint venture agreement, if the project is funded with 100% equity, we have agreed to fund 50% of our partner’s equity requirement, structured as preferred equity. We expect to fund approximately $25.4 million at a rate of LIBOR plus 3.0% per annum and receive priority distributions from all distributions to our partner until the principal and interest are repaid. As of June 30, 2017, we had contributed an aggregate of approximately $13.5 million of preferred equity to the venture. |
(5) | This development has a $125 million construction facility. As of June 30, 2017, no amounts have been drawn under this facility. |
(6) | This development is subject to a 99-year ground lease (including extension options) with an option to purchase in the future. |
(7) | Percentage leased includes only the retail space and includes approximately 9,000 square feet of retail space from the Proto at Cambridge residential development, which is 0% leased. |
(8) | The low-rise portion of 601 Lexington Avenue. |
Six months ended June 30, | |||||||||||
2017 | 2016 | Increase (Decrease) | |||||||||
(in thousands) | |||||||||||
Net cash provided by operating activities | $ | 372,278 | $ | 584,151 | $ | (211,873 | ) | ||||
Net cash used in investing activities | (539,470 | ) | (425,592 | ) | (113,878 | ) | |||||
Net cash provided by financing activities | 302,713 | 297,767 | 4,946 |
Six months ended June 30, | |||||||
2017 | 2016 | ||||||
(in thousands) | |||||||
Acquisitions of real estate (1) | $ | (15,953 | ) | $ | (78,000 | ) | |
Construction in progress (2) | (297,747 | ) | (242,944 | ) | |||
Building and other capital improvements | (100,808 | ) | (48,306 | ) | |||
Tenant improvements | (107,533 | ) | (116,935 | ) | |||
Proceeds from sales of real estate (3) | 17,049 | 104,816 | |||||
Proceeds from sales of real estate placed in escrow (3) | (16,640 | ) | (104,696 | ) | |||
Proceeds from sales of real estate released from escrow (3) | 15,844 | 104,696 | |||||
Cash released from escrow for investing activities | 9,004 | 6,694 | |||||
Cash released from escrow for land sale contracts | — | 781 | |||||
Deposit on real estate (4) | — | (25,000 | ) | ||||
Capital contributions to unconsolidated joint ventures (5) | (41,491 | ) | (26,040 | ) | |||
Investments in securities, net | (1,195 | ) | (658 | ) | |||
Net cash used in investing activities | $ | (539,470 | ) | $ | (425,592 | ) |
(1) | On May 15, 2017, we acquired 103 Carnegie Center located in Princeton, New Jersey for a purchase price of approximately $16.0 million in cash, including transaction costs. |
(2) | Construction in progress for the six months ended June 30, 2017 includes ongoing expenditures associated with Reservoir Place North, 888 Boylston Street and the Prudential Center retail expansion, which were partially or fully placed in-service during the six months ended June 30, 2017. In addition, we incurred costs associated with our continued development/redevelopment of Salesforce Tower, One Five Nine East 53rd Street (the low-rise portion of 601 Lexington Avenue), 191 Spring Street, 145 Broadway, MacArthur Transit Center and Proto at Cambridge and Signature at Reston residential projects. |
(3) | On April 19, 2017, we completed the sale of an approximately 9.5-acre parcel of land at 30 Shattuck Road located in Andover, Massachusetts for a gross sale price of $5.0 million. Net cash proceeds totaled approximately $5.0 million. |
(4) | Deposits on real estate for the six months ended June 30, 2016 was related to a deposit we made prior to our closing on the acquisition of a 49.8% interest in an existing joint venture that owns and operates Colorado Center located in Santa Monica, California. |
(5) | Capital contributions to unconsolidated joint ventures for the six months ended June 30, 2017 were primarily due to cash contributions of approximately $21.9 million and $19.4 million to our Dock 72 and Hub on Causeway joint ventures, respectively. |
June 30, 2017 | |||||||||||
Shares / Units Outstanding | Common Stock Equivalent | Equivalent Value (1) | |||||||||
Common Stock | 154,307,529 | 154,307,529 | $ | 18,982,912 | |||||||
Common Operating Partnership Units | 17,640,667 | 17,640,667 | 2,170,154 | (2) | |||||||
5.25% Series B Cumulative Redeemable Preferred Stock (non-callable until March 27, 2018) | 80,000 | — | 200,000 | ||||||||
Total Equity | 171,948,196 | $ | 21,353,066 | ||||||||
Consolidated Debt | $ | 10,236,639 | |||||||||
Add: | |||||||||||
BXP’s share of unconsolidated joint venture debt (3) | 317,724 | ||||||||||
Subtract: | |||||||||||
Partners’ share of Consolidated Debt (4) | (1,211,485 | ) | |||||||||
BXP’s Share of Debt | $ | 9,342,878 | |||||||||
Consolidated Market Capitalization | $ | 31,589,705 | |||||||||
BXP’s Share of Market Capitalization | $ | 30,695,944 | |||||||||
Consolidated Debt/Consolidated Market Capitalization | 32.40 | % | |||||||||
BXP’s Share of Debt/BXP’s Share of Market Capitalization | 30.44 | % |
(1) | Except for the Series B Cumulative Redeemable Preferred Stock, which is valued at the liquidation preference of $2,500.00 per share, values are based on the closing price per share of BXP’s Common Stock on June 30, 2017 of $123.02, |
(2) | Includes 816,982 long-term incentive plan units (including 118,067 2012 OPP Units, 85,405 2013 MYLTIP Units and 25,107 2014 MYLTIP Units), but excludes an aggregate of 1,239,978 MYLTIP Units granted between 2015 and 2017. |
(3) | See page 77 for additional information. |
(4) | See page 76 for additional information. |
(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, 2013 MYLTIP Units and 2014 MYLTIP Units that were issued in the form of LTIP Units; plus |
June 30, | |||||||
2017 | 2016 | ||||||
(dollars in thousands) | |||||||
Debt Summary: | |||||||
Balance | |||||||
Fixed rate mortgage notes payable, net | $ | 2,986,283 | $ | 3,189,013 | |||
Unsecured senior notes, net | 7,250,356 | 6,257,274 | |||||
Unsecured line of credit | — | — | |||||
Unsecured term loan | — | — | |||||
Mezzanine notes payable | — | 307,797 | |||||
Outside members’ notes payable | — | 180,000 | |||||
Consolidated Debt | 10,236,639 | 9,934,084 | |||||
Add: | |||||||
BXP’s share of unconsolidated joint venture debt (1) | 317,724 | 350,831 | |||||
Subtract: | |||||||
Partners’ share of consolidated mortgage notes payable, net (2) | (1,211,485 | ) | (853,280 | ) | |||
Partners’ share of consolidated mezzanine notes payable | — | (123,119 | ) | ||||
Outside members’ notes payable | — | (180,000 | ) | ||||
BXP’s Share of Debt | $ | 9,342,878 | $ | 9,128,516 | |||
June 30, | |||||||
2017 | 2016 | ||||||
Consolidated Debt Financing Statistics: | |||||||
Percent of total debt: | |||||||
Fixed rate | 100.00 | % | 100.00 | % | |||
Variable rate | — | % | — | % | |||
Total | 100.00 | % | 100.00 | % | |||
GAAP Weighted-average interest rate at end of period: | |||||||
Fixed rate | 4.13 | % | 4.32 | % | |||
Variable rate | — | % | — | % | |||
Total | 4.13 | % | 4.32 | % | |||
Coupon/Stated Weighted-average interest rate at end of period: | |||||||
Fixed rate | 4.03 | % | 4.77 | % | |||
Variable rate | — | % | — | % | |||
Total | 4.03 | % | 4.77 | % | |||
Weighted-average maturity at end of period (in years): | |||||||
Fixed rate | 6.4 | 4.4 | |||||
Variable rate | — | — | |||||
Total | 6.4 | 4.4 |
(1) | See page 77 for additional information. |
(2) | See page 76 for additional information. |
Coupon/ Stated Rate | Effective Rate(1) | Principal Amount | Maturity Date(2) | ||||||||
10 Year Unsecured Senior Notes | 5.875 | % | 5.967 | % | $ | 700,000 | October 15, 2019 | ||||
10 Year Unsecured Senior Notes | 5.625 | % | 5.708 | % | 700,000 | November 15, 2020 | |||||
10 Year Unsecured Senior Notes | 4.125 | % | 4.289 | % | 850,000 | May 15, 2021 | |||||
7 Year Unsecured Senior Notes | 3.700 | % | 3.853 | % | 850,000 | November 15, 2018 | |||||
11 Year Unsecured Senior Notes | 3.850 | % | 3.954 | % | 1,000,000 | February 1, 2023 | |||||
10.5 Year Unsecured Senior Notes | 3.125 | % | 3.279 | % | 500,000 | September 1, 2023 | |||||
10.5 Year Unsecured Senior Notes | 3.800 | % | 3.916 | % | 700,000 | February 1, 2024 | |||||
10 Year Unsecured Senior Notes | 3.650 | % | 3.766 | % | 1,000,000 | February 1, 2026 | |||||
10 Year Unsecured Senior Notes | 2.750 | % | 3.495 | % | 1,000,000 | October 1, 2026 | |||||
Total principal | 7,300,000 | ||||||||||
Net unamortized discount | (17,474 | ) | |||||||||
Deferred financing costs, net | (32,170 | ) | |||||||||
Total | $ | 7,250,356 |
(1) | Yield on issuance date including the effects of discounts on the notes, settlements of interest rate contracts and the amortization of financing costs. |
(2) | No principal amounts are due prior to maturity. |
Properties | Stated Interest Rate | GAAP Interest Rate(1) | Stated Principal Amount | Deferred Financing Costs, Net | Carrying Amount | Carrying Amount (partners’ share) | Maturity Date | |||||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||||||
Wholly-owned | ||||||||||||||||||||||||||
New Dominion Tech Park, Bldg. One | 7.69 | % | 7.84 | % | $ | 34,409 | $ | (295 | ) | $ | 34,114 | N/A | January 15, 2021 | |||||||||||||
University Place | 6.94 | % | 6.99 | % | 8,331 | (52 | ) | 8,279 | N/A | August 1, 2021 | ||||||||||||||||
42,740 | (347 | ) | 42,393 | N/A | ||||||||||||||||||||||
Consolidated Joint Ventures | ||||||||||||||||||||||||||
767 Fifth Avenue (the General Motors Building) | 3.43 | % | 3.64 | % | 2,300,000 | (34,687 | ) | 2,265,313 | 906,125 | (2)(3)(4) | June 9, 2027 | |||||||||||||||
601 Lexington Avenue | 4.75 | % | 4.79 | % | 680,167 | (1,590 | ) | 678,577 | 305,360 | (5) | April 10, 2022 | |||||||||||||||
2,980,167 | (36,277 | ) | 2,943,890 | 1,211,485 | ||||||||||||||||||||||
Total | $ | 3,022,907 | $ | (36,624 | ) | $ | 2,986,283 | $ | 1,211,485 |
(1) | GAAP interest rate differs from the stated interest rate due to the inclusion of the amortization of financing charges and the effects of hedging transactions. |
(2) | The mortgage loan requires interest only payments with a balloon payment due at maturity |
(3) | This property is owned by a consolidated entity in which we have a 60% interest. |
(4) | 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 June 30, 2017, the maximum funding obligation under the guarantee was approximately $263.8 million. 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 Notes 5 and 7 to the Consolidated Financial Statements). |
(5) | This property is owned by a consolidated entity in which we have a 55% interest. |
Properties | Venture Ownership % | Stated Interest Rate | GAAP Interest Rate (1) | Stated Principal Amount | Deferred Financing Costs, Net | Carrying Amount | Carrying Amount (Our Share) | Maturity Date | |||||||||||||||||||||
(dollars in thousands) | |||||||||||||||||||||||||||||
540 Madison Avenue | 60 | % | 2.51 | % | 2.68 | % | $ | 120,000 | $ | (187 | ) | $ | 119,813 | $ | 71,888 | (2)(3) | June 5, 2018 | ||||||||||||
Market Square North | 50 | % | 5.75 | % | 5.81 | % | 122,285 | (273 | ) | 122,012 | 61,006 | October 1, 2020 | |||||||||||||||||
Annapolis Junction Building One | 50 | % | 6.76 | % | 6.93 | % | 39,549 | (62 | ) | 39,487 | 19,739 | (4) | March 31, 2018 | ||||||||||||||||
Annapolis Junction Building Six | 50 | % | 3.34 | % | 3.57 | % | 13,886 | (48 | ) | 13,838 | 6,919 | (5) | November 17, 2018 | ||||||||||||||||
Annapolis Junction Building Seven and Eight | 50 | % | 3.36 | % | 3.64 | % | 36,423 | (249 | ) | 36,174 | 18,087 | (6) | December 7, 2019 | ||||||||||||||||
1265 Main Street | 50 | % | 3.77 | % | 3.84 | % | 40,095 | (402 | ) | 39,693 | 19,846 | January 1, 2032 | |||||||||||||||||
Dock 72 | 50 | % | N/A | N/A | — | — | — | — | (2)(7) | December 18, 2020 | |||||||||||||||||||
500 North Capitol Street | 30 | % | 4.15 | % | 4.20 | % | 105,000 | (350 | ) | 104,650 | 31,395 | (2) | June 6, 2023 | ||||||||||||||||
901 New York Avenue | 25 | % | 3.61 | % | 3.69 | % | 225,000 | (1,340 | ) | 223,660 | 55,915 | January 5, 2025 | |||||||||||||||||
Metropolitan Square | 20 | % | 5.75 | % | 5.81 | % | 164,936 | (282 | ) | 164,654 | 32,929 | May 5, 2020 | |||||||||||||||||
Total | $ | 867,174 | $ | (3,193 | ) | $ | 863,981 | $ | 317,724 |
(1) | GAAP interest rate differs from the stated interest rate due to the inclusion of the amortization of financing charges. |
(2) | The loan requires interest only payments with a balloon payment due at maturity. |
(3) | Mortgage loan bears interest at a variable rate equal to LIBOR plus 1.50% per annum. |
(4) | On April 11, 2016, a notice of event of default was received from the lender because the loan to value ratio is not in compliance with the applicable covenant in the loan agreement. On October 17, 2016, the lender notified the joint venture that it has elected to charge the default rate on the loan. The default rate is defined as LIBOR plus 5.75% per annum. Subsequently, the cash flows generated from the property have become insufficient to fund debt service payments and capital improvements necessary to lease and operate the property and the joint venture is not prepared to fund additional cash shortfalls at this time. Consequently, the joint venture is not current on making debt service payments and remains in default. The loan has one, three-year extension option, subject to certain conditions including that no event of default exists or is ongoing. |
(5) | The loan bears interest at a variable rate equal to LIBOR plus 2.25% per annum. |
(6) | The loan bears interest at a variable rate equal to LIBOR plus 2.35% per annum and matures on December 7, 2019, with three, one-year extension options, subject to certain conditions. |
(7) | No amounts have been drawn under the $250.0 million construction facility. The construction financing bears interest at a variable rate equal to LIBOR plus 2.25% per annum and matures on December 18, 2020 with two, one-year extension option, subject to certain conditions. |
Three months ended June 30, | |||||||
2017 | 2016 | ||||||
(in thousands) | |||||||
Net income attributable to Boston Properties, Inc. common shareholders | $ | 133,709 | $ | 96,597 | |||
Add: | |||||||
Preferred dividends | 2,625 | 2,589 | |||||
Noncontrolling interest—common units of Boston Properties Limited Partnership | 15,473 | 11,357 | |||||
Noncontrolling interests in property partnerships | 15,203 | 6,814 | |||||
Less: | |||||||
Gains on sales of real estate | 3,767 | — | |||||
Income before gains on sales of real estate | 163,243 | 117,357 | |||||
Add: | |||||||
Depreciation and amortization | 151,919 | 153,175 | |||||
Noncontrolling interests in property partnerships’ share of depreciation and amortization | (19,327 | ) | (19,369 | ) | |||
BXP’s share of depreciation and amortization from unconsolidated joint ventures | 9,629 | 4,618 | |||||
Corporate-related depreciation and amortization | (486 | ) | (362 | ) | |||
Less: | |||||||
Noncontrolling interests in property partnerships | 15,203 | 6,814 | |||||
Preferred dividends | 2,625 | 2,589 | |||||
Funds from Operations (FFO) attributable to Boston Properties Limited Partnership common unitholders (including Boston Properties, Inc.) (“Basic FFO”) | 287,150 | 246,016 | |||||
Less: | |||||||
Noncontrolling interest—common units of Boston Properties Limited Partnership’s share of funds from operations | 29,269 | 25,421 | |||||
FFO attributable to Boston Properties, Inc. common shareholders | $ | 257,881 | $ | 220,595 | |||
Boston Properties, Inc.’s percentage share of Funds from Operations—basic | 89.81 | % | 89.67 | % | |||
Weighted-average shares outstanding—basic | 154,177 | 153,662 |
Three Months Ended June 30, 2017 | Three Months Ended June 30, 2016 | ||||||||||||
Income (Numerator) | Shares (Denominator) | Income (Numerator) | Shares (Denominator) | ||||||||||
(in thousands) | |||||||||||||
Basic FFO | $ | 287,150 | 171,675 | $ | 246,016 | 171,370 | |||||||
Effect of Dilutive Securities | |||||||||||||
Stock Based Compensation | — | 154 | — | 198 | |||||||||
Diluted FFO | 287,150 | 171,829 | 246,016 | 171,568 | |||||||||
Less: | |||||||||||||
Noncontrolling interest—common units of Boston Properties Limited Partnership’s share of diluted FFO | 29,243 | 17,498 | 25,391 | 17,708 | |||||||||
Boston Properties, Inc.’s share of Diluted FFO (1) | $ | 257,907 | 154,331 | $ | 220,625 | 153,860 |
(1) | BXP’s share of diluted FFO was 89.82% and 89.68% for the three months ended June 30, 2017 and 2016, respectively. |
Three months ended June 30, | |||||||
2017 | 2016 | ||||||
(in thousands) | |||||||
Net income attributable to Boston Properties Limited Partnership common unitholders | $ | 151,844 | $ | 109,938 | |||
Add: | |||||||
Preferred distributions | 2,625 | 2,589 | |||||
Noncontrolling interests in property partnerships | 15,203 | 6,814 | |||||
Less: | |||||||
Gains on sales of real estate | 4,344 | — | |||||
Income before gains on sales of real estate | 165,328 | 119,341 | |||||
Add: | |||||||
Depreciation and amortization | 149,834 | 151,191 | |||||
Noncontrolling interests in property partnerships’ share of depreciation and amortization | (19,327 | ) | (19,369 | ) | |||
BPLP’s share of depreciation and amortization from unconsolidated joint ventures | 9,629 | 4,618 | |||||
Corporate-related depreciation and amortization | (486 | ) | (362 | ) | |||
Less: | |||||||
Noncontrolling interests in property partnerships | 15,203 | 6,814 | |||||
Preferred distributions | 2,625 | 2,589 | |||||
Funds from Operations (FFO) attributable to Boston Properties Limited Partnership common unitholders (“Basic FFO”) (1) | $ | 287,150 | $ | 246,016 | |||
Weighted-average units outstanding—basic | 171,675 | 171,370 |
(1) | Our calculation includes OP Units and vested LTIP Units (including vested 2012 OPP Units, vested 2013 MYLTIP Units and vested 2014 MYLTIP Units). |
Three Months Ended June 30, 2017 | Three Months Ended June 30, 2016 | ||||||||||||
Income (Numerator) | Units (Denominator) | Income (Numerator) | Units (Denominator) | ||||||||||
(in thousands) | |||||||||||||
Basic FFO | $ | 287,150 | 171,675 | $ | 246,016 | 171,370 | |||||||
Effect of Dilutive Securities | |||||||||||||
Stock Based Compensation | — | 154 | — | 198 | |||||||||
Diluted FFO | $ | 287,150 | 171,829 | $ | 246,016 | 171,568 |
2017 | 2018 | 2019 | 2020 | 2021 | 2022+ | Total | Estimated Fair Value | ||||||||||||||||||||||||
(dollars in thousands) Mortgage debt, net | |||||||||||||||||||||||||||||||
Fixed Rate | $ | 6,982 | $ | 14,703 | $ | 15,740 | $ | 16,836 | $ | 36,342 | $ | 2,895,680 | $ | 2,986,283 | $ | 3,056,829 | |||||||||||||||
Average Interest Rate | 5.51 | % | 5.52 | % | 5.53 | % | 5.55 | % | 6.61 | % | 3.89 | % | 3.96 | % | |||||||||||||||||
Variable Rate | — | — | — | — | — | — | — | — | |||||||||||||||||||||||
Unsecured debt, net | |||||||||||||||||||||||||||||||
Fixed Rate | $ | (4,427 | ) | $ | 841,285 | $ | 692,461 | $ | 692,962 | $ | 844,289 | $ | 4,183,786 | $ | 7,250,356 | $ | 7,516,131 | ||||||||||||||
Average Interest Rate | — | 3.85 | % | 5.97 | % | 5.71 | % | 4.29 | % | 3.71 | % | 4.21 | % | ||||||||||||||||||
Variable Rate | — | — | — | — | — | — | — | — | |||||||||||||||||||||||
$ | 2,555 | $ | 855,988 | $ | 708,201 | $ | 709,798 | $ | 880,631 | $ | 7,079,466 | $ | 10,236,639 | $ | 10,572,960 |
(a) | During the three months ended June 30, 2017, Boston Properties, Inc. issued an aggregate of 458,079 shares of common stock in exchange for 458,079 common units of limited partnership that were held by certain limited partners of Boston Properties Limited Partnership. Of these shares, 456,651 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 partners who received the shares of common stock. |
(b) | Not applicable. |
(c) | Issuer Purchases of Equity Securities. |
Period | (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 | ||||
April 1, 2017 - April 30, 2017 | — | $ | — | N/A | N/A | |||
May 1, 2017 - May 31, 2017 | — | — | N/A | N/A | ||||
June 1, 2017 - June 30, 2017 | 1,356 | (1) | 0.01 | N/A | N/A | |||
Total | 1,356 | $ | 0.01 | N/A | N/A |
(1) | Represents shares of restricted common stock of Boston Properties, Inc. repurchased in connection with the termination of certain employees’ employment with Boston Properties, Inc. Under the terms of the applicable restricted stock award agreements, such shares were repurchased by Boston Properties, Inc. at a price of $0.01 per share, which was the amount originally paid by such employees for such shares. |
(a) | Each time Boston Properties, Inc. issues shares of stock (other than in exchange for common units of limited partnership of Boston Properties Limited Partnership when such common units are presented for redemption), it contributes the proceeds of such issuance to Boston Properties Limited Partnership in return for an equivalent number of partnership units with rights and preferences analogous to the shares issued. During the three months ended June 30, 2017, in connection with issuances of common stock by Boston Properties, Inc. pursuant to issuances to non-employee directors of Boston Properties, Inc. of restricted common stock under the 2012 Plan, Boston Properties Limited Partnership issued an aggregate of approximately 1,575 common units to Boston |
(b) | Not Applicable. |
(c) | Issuer Purchases of Equity Securities. |
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 | ||||
April 1, 2017 - April 30, 2017 | 326 | (1) | $ | 0.25 | N/A | N/A | ||
May 1, 2017 - May 31, 2017 | — | — | N/A | N/A | ||||
June 1, 2017 - June 30, 2017 | 2,318 | (2) | 0.11 | N/A | N/A | |||
Total | 2,644 | $ | 0.13 | N/A | N/A |
(1) | Represents LTIP units that were repurchased in connection with the termination of a certain employee’s employment with Boston Properties, Inc. Under the terms of the applicable LTIP unit vesting agreements, these units were repurchased by Boston Properties Limited Partnership at a price of $0.25 per unit, which was the amount originally paid by such employee for such units. |
(2) | Includes 86 2013 MYLTIP units, 17 2014 MYLTIP units, 600 2015 MYLTIP units and 259 LTIP units that were repurchased in connection with the termination of a certain employee’s employment with Boston Properties, Inc. Under the terms of the applicable LTIP unit vesting agreements and MYLTIP award agreements, such units were repurchased by Boston Properties Limited Partnership at a price of $0.25 per unit, which was the amount originally paid by such employee for such units. Also includes 1,356 common units previously held by Boston Properties, Inc. that were redeemed in connection with the repurchase of shares of restricted common stock of Boston Properties, Inc. in connection with the termination of certain employees’ employment with Boston Properties, Inc. Under the terms of the applicable restricted stock award agreements, such shares were repurchased by Boston Properties, Inc. at a price of $0.01 per share, which was the amount originally paid by such employees for such shares. |
(a) | None. |
(b) | None. |
(a) | Exhibits |
12.1 | — | ||
12.2 | — | ||
31.1 | — | ||
31.2 | — | ||
31.3 | — | ||
31.4 | — | ||
32.1 | — | ||
32.2 | — | ||
32.3 | — | ||
32.4 | — | ||
101 | — | The following materials from Boston Properties, Inc.’s and Boston Properties Limited Partnership’s Quarterly Reports on Form 10-Q for the quarter ended June 30, 2017 formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Comprehensive Income, (iv) the Consolidated Statements of Stockholders’ Equity, (v) the Consolidated Statements of Partners’ Capital (vi) the Consolidated Statements of Cash Flows, and (vii) related notes to these financial statements. |
BOSTON PROPERTIES, INC. | ||
August 8, 2017 | /s/ MICHAEL R. WALSH | |
Michael R. Walsh | ||
Chief Accounting Officer (duly authorized officer and principal accounting officer) |
BOSTON PROPERTIES LIMITED PARTNERSHIP | ||
By: Boston Properties, Inc., its General Partner | ||
August 8, 2017 | /s/ MICHAEL R. WALSH | |
Michael R. Walsh | ||
Chief Accounting Officer (duly authorized officer and principal accounting officer) |
Six Months Ended June 30, 2017 | Year Ended December 31, | |||||||||||||||||||||||
2016 | 2015 | 2014 | 2013 | 2012 | ||||||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||||
Earnings: | ||||||||||||||||||||||||
Add: | ||||||||||||||||||||||||
Income from continuing operations before income from unconsolidated joint ventures, gains on consolidation of joint ventures and gain on sale of investment in unconsolidated joint venture | $ | 272,482 | $ | 421,927 | $ | 401,253 | $ | 345,249 | $ | 242,583 | $ | 236,378 | ||||||||||||
Gains on sales of real estate | 3,900 | 80,606 | 375,895 | 168,039 | — | — | ||||||||||||||||||
Amortization of interest capitalized | 5,411 | 10,685 | 10,203 | 8,211 | 5,522 | 5,278 | ||||||||||||||||||
Distributions from unconsolidated joint ventures | 2,905 | 24,955 | 8,469 | 7,372 | 17,600 | 20,565 | ||||||||||||||||||
Fixed charges (see below) | 219,612 | 456,710 | 471,441 | 515,891 | 528,116 | 469,083 | ||||||||||||||||||
Subtract: | ||||||||||||||||||||||||
Interest capitalized | (26,628 | ) | (39,237 | ) | (34,213 | ) | (52,476 | ) | (68,152 | ) | (44,278 | ) | ||||||||||||
Preferred distributions of consolidated subsidiaries | — | — | (6 | ) | (1,023 | ) | (6,046 | ) | (3,497 | ) | ||||||||||||||
Noncontrolling interests in income of subsidiaries that have not incurred fixed charges | (19,053 | ) | (37,171 | ) | (40,248 | ) | (28,958 | ) | (5,818 | ) | — | |||||||||||||
Total earnings | $ | 458,629 | $ | 918,475 | $ | 1,192,794 | $ | 962,305 | $ | 713,805 | $ | 683,529 | ||||||||||||
Fixed charges: | ||||||||||||||||||||||||
Interest expensed | $ | 190,677 | $ | 412,849 | $ | 432,196 | $ | 455,743 | $ | 447,240 | $ | 413,564 | ||||||||||||
Interest capitalized | 26,628 | 39,237 | 34,213 | 52,476 | 68,152 | 44,278 | ||||||||||||||||||
Portion of rental expense representative of the interest factor (one-third of rental expense) | 2,307 | 4,624 | 5,026 | 6,649 | 6,678 | 7,744 | ||||||||||||||||||
Preferred distributions of consolidated subsidiaries | — | — | 6 | 1,023 | 6,046 | 3,497 | ||||||||||||||||||
Total fixed charges | $ | 219,612 | $ | 456,710 | $ | 471,441 | $ | 515,891 | $ | 528,116 | $ | 469,083 | ||||||||||||
Preferred dividends | 5,250 | 10,500 | 10,500 | 10,500 | 8,057 | — | ||||||||||||||||||
Total combined fixed charges and preferred dividends | $ | 224,862 | $ | 467,210 | $ | 481,941 | $ | 526,391 | $ | 536,173 | $ | 469,083 | ||||||||||||
Ratio of earnings to fixed charges | 2.09 | 2.01 | 2.53 | 1.87 | 1.35 | 1.46 | ||||||||||||||||||
Ratio of earnings to combined fixed charges and preferred dividends | 2.04 | 1.97 | 2.47 | 1.83 | 1.33 | 1.46 |
Six Months Ended June 30, 2017 | Year Ended December 31, | |||||||||||||||||||||||
2016 | 2015 | 2014 | 2013 | 2012 | ||||||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||||
Earnings: | ||||||||||||||||||||||||
Add: | ||||||||||||||||||||||||
Income from continuing operations before income from unconsolidated joint ventures, gains on consolidation of joint ventures and gain on sale of investment in unconsolidated joint venture | $ | 276,714 | $ | 433,554 | $ | 409,246 | $ | 353,758 | $ | 254,536 | $ | 244,561 | ||||||||||||
Gains on sales of real estate | 4,477 | 82,775 | 377,093 | 174,686 | — | — | ||||||||||||||||||
Amortization of interest capitalized | 5,411 | 10,685 | 10,203 | 8,211 | 5,522 | 5,278 | ||||||||||||||||||
Distributions from unconsolidated joint ventures | 2,905 | 24,955 | 8,469 | 7,372 | 17,600 | 20,565 | ||||||||||||||||||
Fixed charges (see below) | 219,612 | 456,710 | 471,435 | 514,868 | 522,070 | 465,586 | ||||||||||||||||||
Subtract: | ||||||||||||||||||||||||
Interest capitalized | (26,628 | ) | (39,237 | ) | (34,213 | ) | (52,476 | ) | (68,152 | ) | (44,278 | ) | ||||||||||||
Noncontrolling interests in income of subsidiaries that have not incurred fixed charges | (19,053 | ) | (37,171 | ) | (40,248 | ) | (28,958 | ) | (5,818 | ) | — | |||||||||||||
Total earnings | $ | 463,438 | $ | 932,271 | $ | 1,201,985 | $ | 977,461 | $ | 725,758 | $ | 691,712 | ||||||||||||
Fixed charges: | ||||||||||||||||||||||||
Interest expensed | $ | 190,677 | $ | 412,849 | $ | 432,196 | $ | 455,743 | $ | 447,240 | $ | 413,564 | ||||||||||||
Interest capitalized | 26,628 | 39,237 | 34,213 | 52,476 | 68,152 | 44,278 | ||||||||||||||||||
Portion of rental expense representative of the interest factor (one-third of rental expense) | 2,307 | 4,624 | 5,026 | 6,649 | 6,678 | 7,744 | ||||||||||||||||||
Total fixed charges | $ | 219,612 | $ | 456,710 | $ | 471,435 | $ | 514,868 | $ | 522,070 | $ | 465,586 | ||||||||||||
Preferred distributions | 5,250 | 10,500 | 10,506 | 11,523 | 14,103 | 3,497 | ||||||||||||||||||
Total combined fixed charges and preferred distributions | $ | 224,862 | $ | 467,210 | $ | 481,941 | $ | 526,391 | $ | 536,173 | $ | 469,083 | ||||||||||||
Ratio of earnings to fixed charges | 2.11 | 2.04 | 2.55 | 1.90 | 1.39 | 1.49 | ||||||||||||||||||
Ratio of earnings to combined fixed charges and preferred distributions | 2.06 | 2.00 | 2.49 | 1.86 | 1.35 | 1.47 |
1. | I have reviewed this Quarterly Report on Form 10-Q of Boston Properties, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
/s/ OWEN D. THOMAS | |
Owen D. Thomas | |
Chief Executive Officer |
1. | I have reviewed this Quarterly Report on Form 10-Q of Boston Properties, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
/s/ MICHAEL E. LABELLE | |
Michael E. LaBelle | |
Chief Financial Officer |
1. | I have reviewed this Quarterly Report on Form 10-Q of Boston Properties Limited Partnership; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
/s/ OWEN D. THOMAS |
Owen D. Thomas Chief Executive Officer of Boston Properties, Inc. General Partner of Boston Properties Limited Partnership |
1. | I have reviewed this Quarterly Report on Form 10-Q of Boston Properties Limited Partnership; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
/s/ MICHAEL E. LABELLE |
Michael E. LaBelle Chief Financial Officer of Boston Properties, Inc. General Partner of Boston Properties Limited Partnership |
/s/ OWEN D. THOMAS | |
Owen D. Thomas | |
Chief Executive Officer |
/s/ MICHAEL E. LABELLE | |
Michael E. LaBelle | |
Chief Financial Officer |
/s/ OWEN D. THOMAS |
Owen D. Thomas Chief Executive Officer of Boston Properties, Inc. General Partner of Boston Properties Limited Partnership |
/s/ MICHAEL E. LABELLE |
Michael E. LaBelle Chief Financial Officer of Boston Properties, Inc. General Partner of Boston Properties Limited Partnership |
Document And Entity Information - shares |
6 Months Ended | |
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Jun. 30, 2017 |
Aug. 03, 2017 |
|
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2017 | |
Document Fiscal Year Focus | 2017 | |
Document Fiscal Period Focus | Q2 | |
Entity Registrant Name | BOSTON PROPERTIES INC | |
Amendment Flag | false | |
Entity Central Index Key | 0001037540 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 154,317,716 | |
Boston Properties Limited Partnership | ||
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2017 | |
Document Fiscal Year Focus | 2017 | |
Document Fiscal Period Focus | Q2 | |
Entity Registrant Name | BOSTON PROPERTIES LTD PARTNERSHIP | |
Amendment Flag | false | |
Entity Central Index Key | 0001043121 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 0 |
Consolidated Statements Of Comprehensive Income - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||||||
---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
Jun. 30, 2017 |
Jun. 30, 2016 |
||||||
Net income | $ 167,010 | $ 117,357 | $ 282,574 | $ 333,579 | |||||
Other comprehensive income (loss): | |||||||||
Effective portion of interest rate contracts | (6,313) | (32,351) | (6,133) | (90,997) | |||||
Amortization of interest rate contracts | [1] | 1,397 | 628 | 2,703 | 1,255 | ||||
Other comprehensive loss | (4,916) | (31,723) | (3,430) | (89,742) | |||||
Comprehensive income | 162,094 | 85,634 | 279,144 | 243,837 | |||||
Comprehensive income attributable to noncontrolling interests | (30,676) | (18,171) | (46,560) | (50,049) | |||||
Other comprehensive income (loss) attributable to noncontrolling interests | 2,738 | 8,681 | 2,520 | 24,108 | |||||
Comprehensive income attributable to the Company | 134,156 | 76,144 | 235,104 | 217,896 | |||||
Boston Properties Limited Partnership | |||||||||
Net income | 169,672 | 119,341 | 287,383 | 339,719 | |||||
Other comprehensive income (loss): | |||||||||
Effective portion of interest rate contracts | (6,313) | (32,351) | (6,133) | (90,997) | |||||
Amortization of interest rate contracts | [2] | 1,397 | 628 | 2,703 | 1,255 | ||||
Other comprehensive loss | (4,916) | (31,723) | (3,430) | (89,742) | |||||
Comprehensive income | 164,756 | 87,618 | 283,953 | 249,977 | |||||
Comprehensive income attributable to noncontrolling interests | (12,715) | (793) | (17,211) | (731) | |||||
Comprehensive income attributable to the Company | $ 152,041 | $ 86,825 | $ 266,742 | $ 249,246 | |||||
|
Consolidated Statement of Partners' Capital Statement - USD ($) $ in Thousands |
Total |
Boston Properties Limited Partnership |
---|---|---|
Beginning Balance at Dec. 31, 2015 | $ 3,684,522 | |
Contributions | 2,871 | |
Net income allocable to general and limited partner units | 289,670 | |
Distributions | (204,939) | |
Accumulated other comprehensive loss | (65,634) | |
Unearned compensation | 553 | |
Conversion of redeemable partnership units | 2,664 | |
Adjustment to reflect redeemable partnership units at redemption value | (86,626) | |
Ending Balance at Jun. 30, 2016 | 3,623,081 | |
Beginning Balance at Dec. 31, 2016 | 3,811,717 | |
Contributions | 4,682 | |
Net income allocable to general and limited partner units | 240,823 | |
Distributions | (236,368) | |
Accumulated other comprehensive loss | (910) | |
Cumulative effect of a change in accounting principle | $ (2,035) | (272) |
Unearned compensation | (2,329) | |
Conversion of redeemable partnership units | 16,422 | |
Adjustment to reflect redeemable partnership units at redemption value | 92,740 | |
Ending Balance at Jun. 30, 2017 | $ 3,926,505 |
Organization |
6 Months Ended | ||||||||||||||||||||||||||||
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Jun. 30, 2017 | |||||||||||||||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||
Organization | 1. Organization Boston Properties, Inc., a Delaware corporation, is a fully integrated, self-administered and self-managed real estate investment trust (“REIT”). Boston Properties, Inc. is the sole general partner of Boston Properties Limited Partnership, its operating partnership, and at June 30, 2017 owned an approximate 89.7% (89.5% at December 31, 2016) general and limited partnership interest in Boston Properties Limited Partnership. Unless stated otherwise or the context requires, the “Company” refers to Boston Properties, Inc. and its subsidiaries, including Boston Properties Limited Partnership, and its consolidated subsidiaries. Partnership interests in Boston Properties Limited Partnership include:
Unless specifically noted otherwise, all references to OP Units exclude units held by Boston Properties, Inc. A holder of an OP Unit may present such OP Unit to Boston Properties Limited Partnership for redemption at any time (subject to restrictions agreed upon at the time of issuance of OP Units to particular holders that may restrict such redemption right for a period of time, generally one year from issuance). Upon presentation of an OP Unit for redemption, Boston Properties Limited Partnership is obligated to redeem such OP Unit for cash equal to the value of a share of common stock of Boston Properties, Inc. (“Common Stock”) at such time. In lieu of a cash redemption, Boston Properties, Inc. may elect to acquire such OP Unit for one share of Common Stock. Because the number of shares of Common Stock outstanding at all times equals the number of OP Units that Boston Properties, Inc. owns, one share of Common Stock is generally the economic equivalent of one OP Unit, and the quarterly distribution that may be paid to the holder of an OP Unit equals the quarterly dividend that may be paid to the holder of a share of Common Stock. The Company uses LTIP Units as a form of equity-based award for annual long-term incentive equity compensation. The Company has also issued LTIP Units to employees in the form of (1) 2012 outperformance plan awards (“2012 OPP Units”) and (2) 2013, 2014, 2015, 2016 and 2017 multi-year, long-term incentive program awards (also referred to as “MYLTIP Units”), each of which, upon the satisfaction of certain performance and vesting conditions, is convertible into one OP Unit. The three-year measurement periods for the 2012 OPP Units, 2013 MYLTIP Units and 2014 MYLTIP Units expired on February 6, 2015, February 4, 2016 and February 3, 2017, respectively, and Boston Properties, Inc.’s total stockholder return (“TSR”) was sufficient for employees to earn and therefore become eligible to vest in a portion of the awards. Unless and until they are earned, the rights, preferences and privileges of the 2015, 2016 and 2017 MYLTIP Units differ from other LTIP Units granted to employees (including the 2012 OPP Units, the 2013 MYLTIP Units and the 2014 MYLTIP Units, which have been earned). Therefore, unless specifically noted otherwise, all references to LTIP Units exclude the 2015, 2016 and 2017 MYLTIP Units. LTIP Units (including the 2012 OPP Units, the 2013 MYLTIP Units and the 2014 MYLTIP Units), whether vested or not, will receive the same quarterly per unit distributions as OP Units, which equal per share dividends on Common Stock (See Notes 8, 9 and 11). At June 30, 2017, there was one series of Preferred Units outstanding (i.e., Series B Preferred Units). The Series B Preferred Units were issued to Boston Properties, Inc. on March 27, 2013 in connection with the issuance of 80,000 shares (8,000,000 depositary shares each representing 1/100th of a share) of 5.25% Series B Cumulative Redeemable Preferred Stock (the “Series B Preferred Stock”). Boston Properties, Inc. contributed the net proceeds from the offering to Boston Properties Limited Partnership in exchange for 80,000 Series B Preferred Units having terms and preferences generally mirroring those of the Series B Preferred Stock (See Note 9). Properties At June 30, 2017, the Company owned or had interests in a portfolio of 175 commercial real estate properties (the “Properties”) aggregating approximately 48.4 million net rentable square feet of primarily Class A office properties, including nine properties under construction/redevelopment totaling approximately 4.7 million net rentable square feet. At June 30, 2017, the Properties consisted of:
The Company considers Class A office properties to be centrally located buildings that are professionally managed and maintained, attract high-quality tenants and command upper-tier rental rates, and that are modern structures or have been modernized to compete with newer buildings. |
Basis Of Presentation And Summary Of Significant Accounting Policies |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basis Of Presentation And Summary Of Significant Accounting Policies | 2. Basis of Presentation and Summary of Significant Accounting Policies Boston Properties, Inc. does not have any other significant assets, liabilities or operations, other than its investment in Boston Properties Limited Partnership, nor does it have employees of its own. Boston Properties Limited Partnership, not Boston Properties, Inc., generally executes all significant business relationships other than transactions involving securities of Boston Properties, Inc. All majority-owned subsidiaries and joint ventures over which the Company has financial and operating control and variable interest entities (“VIEs”) in which the Company has determined it is the primary beneficiary are included in the consolidated financial statements. All significant intercompany balances and transactions have been eliminated in consolidation. The Company accounts for all other unconsolidated joint ventures using the equity method of accounting. Accordingly, the Company’s share of the earnings of these joint ventures and companies is included in consolidated net income. The accompanying interim financial statements are unaudited; however, the financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) for interim financial information and in conjunction with the rules and regulations of the Securities and Exchange Commission. Accordingly, they do not include all of the disclosures required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting solely of normal recurring matters) necessary for a fair statement of the financial statements for these interim periods have been included. The results of operations for the interim periods are not necessarily indicative of the results to be obtained for other interim periods or for the full fiscal year. The year-end consolidated balance sheet data was derived from audited financial statements, but does not include all disclosure required by GAAP. These financial statements should be read in conjunction with the Company’s financial statements and notes thereto contained in the Company’s Annual Report in the Company’s Form 10-K for its fiscal year ended December 31, 2016. Fair Value of Financial Instruments The Company determines the fair value of its unsecured senior notes using market prices. The inputs used in determining the fair value of the Company’s unsecured senior notes are categorized at a level 1 basis (as defined in the accounting standards for Fair Value Measurements and Disclosures) due to the fact that the Company uses quoted market rates to value these instruments. However, the inputs used in determining the fair value could be categorized at a level 2 basis (as defined in the accounting standards for Fair Value Measurements and Disclosures) if trading volumes are low. The Company determines the fair value of its mortgage notes payable using discounted cash flow analysis by discounting the spread between the future contractual interest payments and hypothetical future interest payments on mortgage debt based on current market rates for similar securities. In determining the current market rates, the Company adds its estimates of market spreads to the quoted yields on federal government treasury securities with similar maturity dates to its debt. The inputs used in determining the fair value of the Company’s mortgage notes payable and mezzanine notes payable are categorized at a level 3 basis (as defined in the accounting standards for Fair Value Measurements and Disclosures) due to the fact that the Company considers the rates used in the valuation techniques to be unobservable inputs. To the extent that there are outstanding borrowings under the unsecured line of credit, the Company utilizes a discounted cash flow methodology in order to estimate the fair value. To the extent that credit spreads have changed since the origination, the net present value of the difference between future contractual interest payments and future interest payments based on the Company’s estimate of a current market rate would represent the difference between the book value and the fair value. The Company’s estimate of a current market rate is based upon the rate, considering current market conditions and the Company’s specific credit profile, at which it estimates it could obtain similar borrowings. To the extent there are outstanding borrowings, this current market rate is internally estimated and therefore would be primarily based upon a level 3 input. Because the Company’s valuations of its financial instruments are based on these types of estimates, the actual fair values of its financial instruments may differ materially if the Company’s estimates do not prove to be accurate, and the Company’s estimated fair values for these instruments as of the end of the applicable reporting period are not necessarily indicative of estimated or actual fair values in future reporting periods. The following table presents the aggregate carrying value of the Company’s mortgage notes payable, net, mezzanine notes payable and unsecured senior notes, net and the Company’s corresponding estimate of fair value as of June 30, 2017 and December 31, 2016 (in thousands):
The Company uses interest rate swap agreements to manage its interest rate risk. The valuation of these instruments is determined using widely accepted valuation techniques, including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves. To comply with the provisions of Accounting Standards Codification (“ASC”) 820, the Company incorporates credit valuation adjustments to appropriately reflect both its own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements. Although the Company has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with its derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by the Company and its counterparties. The Company has assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and has determined that the credit valuation adjustments are not significant to the overall valuation of its derivatives. As a result, the Company has determined that its derivative valuations in their entirety are classified in Level 2 of the fair value hierarchy. Variable Interest Entities (VIEs) Consolidated VIEs are those where the Company is considered to be the primary beneficiary of a VIE. The primary beneficiary is the entity that has a controlling financial interest in the VIE, which is defined by the entity having both of the following characteristics: (1) the power to direct the activities that, when taken together, most significantly impact the VIE’s performance and (2) the obligation to absorb losses or the right to receive the returns from the VIE that could potentially be significant to the VIE. The Company has determined that it is the primary beneficiary for seven of the eight entities that are VIEs. Consolidated Variable Interest Entities As of June 30, 2017, Boston Properties, Inc. has identified seven consolidated VIEs, including Boston Properties Limited Partnership. The VIEs own (1) the following five in-service properties: 767 Fifth Avenue (the General Motors Building), Times Square Tower, 601 Lexington Avenue, Atlantic Wharf Office Building and 100 Federal Street and (2) the entity that owns Salesforce Tower, which is currently under development. The Company consolidates these VIEs because it is the primary beneficiary. The third parties’ interests in these consolidated entities, with the exception of Boston Properties Limited Partnership, are reflected as noncontrolling interest in property partnerships in the accompanying Consolidated Financial Statements (See Note 8). In addition, Boston Properties, Inc.’s significant asset is its investment in Boston Properties Limited Partnership and, consequently, substantially all of Boston Properties, Inc.’s assets and liabilities are the assets and liabilities of Boston Properties Limited Partnership. All of Boston Properties, Inc.’s debt is an obligation of Boston Properties Limited Partnership. Variable Interest Entities Not Consolidated The Company has determined that its BNY Tower Holdings LLC joint venture, which owns Dock 72 at the Brooklyn Navy Yard, is a VIE. The Company does not consolidate this entity because the Company does not have the power to direct the activities that, when taken together, most significantly impact the VIE’s performance and, therefore, the Company is not considered to be the primary beneficiary. Recent Accounting Pronouncements In May 2014, the Financial Standards Accounting Board (“FASB”) issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”). The objective of ASU 2014-09 is to establish a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and will supersede most of the existing revenue recognition guidance, including industry-specific guidance. The core principle is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In applying ASU 2014-09, companies will perform a five-step analysis of transactions to determine when and how revenue is recognized. ASU 2014-09 applies to all contracts with customers except those that are within the scope of other topics in the FASB’s ASC. In August 2015, the FASB issued ASU 2015-14, “Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date” (“ASU 2015-14”), which delayed the effective date of ASU 2014-09 by one year making it effective for the first interim period within annual reporting periods beginning after December 15, 2017. Early adoption is permitted as of the original effective date. In May 2016, the FASB issued ASU No. 2016-12, “Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients” (“ASU 2016-12”). ASU 2016-12 is intended to clarify and provide practical expedients for certain aspects of ASU 2014-09, which outlines a single comprehensive model for entities to use in accounting for revenues arising from contracts with customers and notes that lease contracts with customers are a scope exception. The Company may elect to adopt ASU 2016-12 as of the original effective date; however, adoption is required for annual reporting periods beginning after December 15, 2017. The Company will adopt ASU 2014-09 effective January 1, 2018 using the modified retrospective approach. The Company’s project team has completed the compilation of the inventory of the sources of revenue that will be impacted by the adoption of ASU 2014-09. The Company expects that executory costs and certain non-lease components of revenue from leases (upon the adoption of ASU 2016-02), tenant service revenue, development and management services revenue, parking revenue and gains on sales of real estate may be impacted by the adoption of ASU 2014-09, although the Company anticipates that the impact will be to the pattern of revenue recognition and not the total revenue recognized over time. The Company is making progress in evaluating the significance of the impact on the changes in the recognition pattern of its revenue and is still completing its assessment of the overall impact of adopting ASU 2014-09. In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842)” (“ASU 2016-02”), which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e., lessees and lessors). ASU 2016-02 requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase of the leased asset by the lessee. This classification will determine whether the lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases today. The new standard requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales-type leases, direct financing leases and operating leases. ASU 2016-02 supersedes previous leasing standards. ASU 2016-02 is effective for the Company for reporting periods beginning after December 15, 2018, with early adoption permitted. The Company has commenced the process of adopting ASU 2016-02 by forming a project team and beginning to compile an inventory of its leases that will be impacted by the adoption of ASU 2016-02. The Company is still assessing the impact of adopting ASU 2016-02. However, the Company expects that its operating leases where it is the lessor will be accounted for on its balance sheet similar to its current accounting with the underlying leased asset recognized as real estate. The Company expects that executory costs and certain other non-lease components will need to be accounted for separately from the lease component of the lease with the lease component continuing to be recognized on a straight-line basis over the lease term and the executory costs and certain other non-lease components being accounted for under the new revenue recognition guidance in ASU 2014-09. For leases in which the Company is the lessee, primarily consisting of ground leases, the Company expects to recognize a right-of-use asset and a lease liability equal to the present value of the minimum lease payments with rental payments being applied to the lease liability and to interest expense and the right-of-use asset being amortized to expense on a straight-line basis over the term of the lease. In addition, under ASU 2016-02, lessors may only capitalize incremental direct leasing costs. As a result, the Company expects that it will no longer be able to capitalize its internal leasing wages and instead will expense these costs as incurred. In March 2016, the FASB issued ASU 2016-09, “Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting” (“ASU 2016-09”). ASU 2016-09 is intended to improve the accounting for share-based payments and affects all organizations that issue share-based payment awards to their employees. Several aspects of the accounting for share-based payment awards are simplified with ASU 2016-09, including income tax consequences, classification of awards as equity or liabilities and classification on the statement of cash flows. ASU 2016-09 is effective for the Company for reporting periods beginning after December 15, 2016, with early adoption permitted. On January 1, 2017, the Company adopted ASU 2016-09 and elected to make an accounting policy change to its method of accounting for forfeitures on its awards of stock-based compensation including the issuance of shares of restricted common stock, LTIP Units and MYLTIP Units. The Company now accounts for forfeitures as they occur instead of estimating the number of forfeitures upon the issuance of such awards of stock-based compensation. The adoption resulted in the Company recognizing cumulative effect of a change in accounting principle adjustments to its consolidated balance sheets totaling approximately $0.3 million to Dividends in Excess of Earnings and Partners’ Capital for Boston Properties, Inc. and Boston Properties Limited Partnership, respectively, and approximately $1.8 million to noncontrolling interests - common units of Boston Properties Limited Partnership and noncontrolling interests - redeemable partnership units for Boston Properties, Inc. and Boston Properties Limited Partnership, respectively. In January 2017, the FASB issued ASU 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business” (“ASU 2017-01”). ASU 2017-01 clarifies the framework for determining whether an integrated set of assets and activities meets the definition of a business. The revised framework establishes a screen for determining whether an integrated set of assets and activities is a business and narrows the definition of a business, which is expected to result in fewer transactions being accounted for as business combinations. Acquisitions of integrated sets of assets and activities that do not meet the definition of a business are accounted for as asset acquisitions. This update is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2017, with early adoption permitted for transactions that have not been reported in previously issued (or available to be issued) financial statements and shall be applied on a prospective basis. The Company early adopted ASU 2017-01 during the first quarter of 2017. The Company expects that acquisitions of real estate or in-substance real estate will not meet the revised definition of a business because substantially all of the fair value is concentrated in a single identifiable asset or group of similar identifiable assets (i.e. land, buildings, and related intangible assets) or because the acquisition does not include a substantive process in the form of an acquired workforce or an acquired contract that cannot be replaced without significant cost, effort or delay. In February 2017, the FASB issued ASU No. 2017-05, “Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets” (“ASU 2017-05”). ASU 2017-05 updates the definition of an “in substance nonfinancial asset” and clarifies the derecognition guidance for nonfinancial assets to conform with the new revenue recognition standard. The effective date and transition methods of ASU 2017-05 are aligned with ASU 2014-09 described above and are effective for the first interim period within annual reporting periods beginning after December 15, 2017. The Company is currently assessing the potential impact that the adoption of ASU 2017-05 will have on its consolidated financial statements. In May 2017, the FASB issued ASU 2017-09, “Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting” (“ASU 2017-09”). ASU 2017-09 is intended to provide clarity and reduce (1) diversity in practice, (2) cost and (3) complexity when applying the guidance in Topic 718 to a change to the terms or conditions of a share-based payment award. ASU 2017-09 is effective for public entities for fiscal years and interim periods beginning after December 15, 2017. The Company is currently assessing the potential impact that the adoption of ASU 2017-09 will have on its consolidated financial statements. |
Real Estate |
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Real Estate [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Real Estate | 3. Real Estate Boston Properties, Inc. Real estate consisted of the following at June 30, 2017 and December 31, 2016 (in thousands):
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Boston Properties Limited Partnership Real estate consisted of the following at June 30, 2017 and December 31, 2016 (in thousands):
Development On April 6, 2017, the Company commenced the development of 145 Broadway, a build-to-suit Class A office project with approximately 485,000 net rentable square feet located in Cambridge, Massachusetts. On May 27, 2017, the Company completed and fully placed in-service Reservoir Place North, a Class A office redevelopment project with approximately 73,000 net rentable square feet located in Waltham, Massachusetts. Ground Lease On June 29, 2017, the Company executed a 99-year ground lease (including extension options), with the right to purchase prior to 10 years after stabilization of the development project as defined in the lease, land adjacent to the MacArthur BART station located in Oakland, California. The Company has commenced development of a 402-unit residential building and supporting retail space on the site. The Company’s option to purchase the land, is considered a bargain purchase option and as a result, the Company has concluded that the lease should be accounted for as a capital lease. At the inception of the ground lease, the Company recorded an approximately $29.0 million capital lease asset and liability, which is reflected within Construction in Progress and Other Liabilities on the Company’s Consolidated Balance Sheets. Capital lease assets and liabilities are accounted for at the lower of fair market value or the present value of future minimum lease payments. This capital lease is for land only, therefore, the Company will not be depreciating the capital lease asset, because land is assumed to have an indefinite life. As of June 29, 2017, future minimum lease payments related to this capital lease are as follows (in thousands):
Acquisitions On May 15, 2017, the Company acquired 103 Carnegie Center located in Princeton, New Jersey for a purchase price of approximately $15.8 million in cash. 103 Carnegie Center is an approximately 96,000 net rentable square foot Class A office property. The following table summarizes the allocation of the aggregate purchase price, including transaction costs, of 103 Carnegie Center at the date of acquisition (in thousands).
The following table summarizes the estimated annual amortization of the acquired below-market lease intangibles and the acquired in-place lease intangibles for 103 Carnegie Center for the remainder of 2017 and each of the next four succeeding fiscal years (in thousands).
103 Carnegie Center contributed approximately $0.4 million of revenue and approximately $0.2 million of earnings to the Company for the period from May 15, 2017 through June 30, 2017. Dispositions On April 19, 2017, the Company completed the sale of an approximately 9.5-acre parcel of land at 30 Shattuck Road located in Andover, Massachusetts for a gross sale price of $5.0 million. Net cash proceeds totaled approximately $5.0 million, resulting in a gain on sale of real estate totaling approximately $3.7 million. On June 13, 2017, the Company completed the sale of 40 Shattuck Road located in Andover, Massachusetts for a gross sale price of $12.0 million. Net cash proceeds totaled approximately $11.9 million, resulting in a gain on sale of real estate totaling approximately $28,000 for Boston Properties, Inc. and approximately $0.6 million for Boston Properties Limited Partnership. 40 Shattuck Road is an approximately 122,000 net rentable square foot Class A office property. 40 Shattuck Road contributed approximately $19,000 and $(28,000) of net income (loss) to the Company for the period from April 1, 2017 through June 13, 2017 and the period from January 1, 2017 through June 13, 2017, respectively, and contributed approximately $(93,000) and $15,000 of net income (loss) to the Company for the three and six months ended June 30, 2016, respectively. |
Investments in Unconsolidated Joint Ventures |
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Investments In Unconsolidated Joint Ventures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments In Unconsolidated Joint Ventures | 4. Investments in Unconsolidated Joint Ventures The investments in unconsolidated joint ventures consist of the following at June 30, 2017 and December 31, 2016:
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Certain of the Company’s unconsolidated joint venture agreements include provisions whereby, at certain specified times, each partner has the right to initiate a purchase or sale of its interest in the joint ventures. With limited exception, under these provisions, the Company is not compelled to purchase the interest of its outside joint venture partners. Under certain of the Company’s joint venture agreements, if certain return thresholds are achieved, the partners will be entitled to an additional promoted interest or payments. The combined summarized balance sheets of the Company’s unconsolidated joint ventures are as follows:
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The combined summarized statements of operations of the Company’s unconsolidated joint ventures are as follows:
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Debt (Notes) |
6 Months Ended |
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Jun. 30, 2017 | |
Debt [Abstract] | |
Debt Disclosure [Text Block] | 5. Debt Mortgage Notes Payable, Net, Mezzanine Notes Payable and Outside Members’ Notes Payable On June 7, 2017, the Company’s consolidated entity in which it has a 60% ownership interest and that owns 767 Fifth Avenue (the General Motors Building) located in New York City completed the refinancing of the indebtedness that had been secured by direct and indirect interests in the property. The new mortgage financing has a principal amount of $2.3 billion, bears interest at a fixed interest rate of 3.43% per annum and matures on June 9, 2027. The loan requires monthly interest-only payments during the 10-year term of the loan, with the entire principal amount being due at maturity. The refinanced indebtedness consisted of (1) mortgage loans payable collateralized by the property aggregating $1.3 billion, (2) mezzanine loans payable aggregating $306.0 million, (3) additional mezzanine loans payable aggregating $294.0 million and (4) member loans aggregating $450.0 million with outstanding accrued interest payable totaling approximately $425.0 million. The mortgage loans required monthly interest-only payments at a weighted-average fixed interest rate of 5.95% per annum and were scheduled to mature on October 7, 2017. The mezzanine loans required interest-only payments at a weighted-average fixed interest rate of 6.02% per annum and were scheduled to mature on October 7, 2017. In addition, a subsidiary of the consolidated entity had acquired a lender’s interest in certain other mezzanine loans assumed during the acquisition of the property having an aggregate principal amount of $294.0 million and a stated interest rate of 6.02% per annum for a purchase price of approximately $263.1 million in cash. These mezzanine loans payable had been eliminated in consolidation and were canceled upon the refinancing of the indebtedness. The member loans bore interest at a fixed rate of 11.0% per annum and were scheduled to mature on June 9, 2017. A portion of the original purchase price of the property was financed with loans from the members on a pro rata basis equal to their percentage interest in the consolidated entity. The Company had eliminated in consolidation its member loan totaling $270.0 million and its share of the related accrued interest payable of approximately $255.0 million at the date of the refinancing. The remaining outside members’ notes payable and related accrued interest payable totaling $180.0 million and approximately $170.0 million, respectively, at the date of the refinancing had been reflected as Outside Members’ Notes Payable and within Accrued Interest Payable, respectively, on the Company’s Consolidated Balance Sheets. The net proceeds from the new financing were used to repay all of the outstanding accrued interest payable on the member loans and a portion of the outstanding principal balance of the member loans totaling approximately $176.1 million. In connection with the refinancing, the members of the Company’s consolidated entity contributed the remaining balance of the member notes payable totaling approximately $273.9 million (of which the Company’s share of approximately $164.4 million had been eliminated in consolidation) to equity in the consolidated entity (See Note 8). There was no prepayment penalty associated with the repayments. The Company recognized a gain from early extinguishment of debt totaling approximately $14.6 million primarily consisting of the acceleration of the remaining balance related to historical fair value debt adjustments. Credit Facility On April 24, 2017, Boston Properties Limited Partnership amended and restated its revolving credit agreement (as amended and restated, the “2017 Credit Facility”). Among other things, the 2017 Credit Facility (1) increased the total commitment of the revolving line of credit (the “Revolving Facility”) from $1.0 billion to $1.5 billion, (2) extended the maturity date from July 26, 2018 to April 24, 2022, (3) reduced the per annum variable interest rates, and (4) added a $500.0 million delayed draw term loan facility (the “Delayed Draw Facility”) that permits Boston Properties Limited Partnership, until the first anniversary of the closing date, to draw upon up to four times a minimum of $50.0 million (or, if less, the unused delayed draw term commitments), provided that amounts drawn under the Delayed Draw Facility and subsequently repaid may not be borrowed again. In addition, Boston Properties Limited Partnership may increase the total commitment under the 2017 Credit Facility by up to $500.0 million through increases in the Revolving Facility or the Delayed Draw Facility, or both, subject to syndication of the increase and other conditions. At Boston Properties Limited Partnership’s option, loans under the Revolving Facility and Delayed Draw Facility will bear interest at a rate per annum equal to (1) (a) in the case of loans denominated in Dollars, Euro or Sterling, LIBOR, and (b) in the case of loans denominated in Canadian Dollars, CDOR, in each case, plus a margin ranging from 77.5 to 155 basis points for the Revolving Commitment and 85 to 175 basis points for the Delayed Draw Facility, based on Boston Properties Limited Partnership’s credit rating or (2) an alternate base rate equal to the greatest of (x) the Administrative Agent’s prime rate, (y) the Federal Funds rate plus 0.50% or (z) LIBOR for a one-month period plus 1.00%, in each case, plus a margin ranging from 0 to 55 basis points for the Revolving Facility and 0 to 75 basis points for the Delayed Draw Facility, based on Boston Properties Limited Partnership’s credit rating. The 2017 Credit Facility also contains a competitive bid option for up to 65% of the Revolving Facility that allows banks that are part of the lender consortium to bid to make loan advances to Boston Properties Limited Partnership at a reduced interest rate. In addition, Boston Properties Limited Partnership is obligated to pay (1) in quarterly installments a facility fee on the total commitment under the Revolving Facility at a rate per annum ranging from 0.10% to 0.30% based on Boston Properties Limited Partnership’s credit rating, (2) an annual fee on the undrawn amount of each letter of credit equal to the LIBOR margin on the Revolving Facility and (3) a fee on the unused commitments under the Delayed Draw Facility equal to 0.15% per annum. Based on Boston Properties Limited Partnership’s current credit rating, (1) the applicable Eurocurrency margins for the Revolving Facility and Delayed Draw Facility are 87.5 basis points and 95 basis points, respectively, (2) the alternate base rate margin is 0 basis points for each of the Revolving Facility and Delayed Draw Facility and (3) the facility fee on the Revolving Facility commitment is 0.15% per annum. The 2017 Credit Facility contains customary representations and warranties, affirmative and negative covenants and events of default provisions, including failure to pay indebtedness, breaches of covenants, and bankruptcy and other insolvency events, which could result in the acceleration of all amounts and cancellation of all commitments outstanding under the Credit Agreement. Among other covenants, the 2017 Credit Facility requires that Boston Properties Limited Partnership maintain on an ongoing basis: (1) a leverage ratio not to exceed 60%, however, the leverage ratio may increase to no greater than 65% provided that it is reduced back to 60% within one year, (2) a secured debt leverage ratio not to exceed 55%, (3) a fixed charge coverage ratio of at least 1.40, (4) an unsecured debt leverage ratio not to exceed 60%, however, the unsecured debt leverage ratio may increase to no greater than 65% provided that it is reduced to 60% within one year, (5) an unsecured debt interest coverage ratio of at least 1.75 and (6) limitations on permitted investments. |
Derivative Instruments and Hedging Activities (Notes) |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities [Text Block] | 6. Derivative Instruments and Hedging Activities During the year ended December 31, 2015, Boston Properties Limited Partnership commenced a planned interest rate hedging program and entered into 17 forward-starting interest rate swap contracts that fixed the 10-year swap rate at a weighted-average rate of approximately 2.423% per annum on notional amounts aggregating $550.0 million. These interest rate swap contracts were entered into in advance of a financing with a target commencement date in September 2016 and maturity in September 2026. On August 17, 2016, in conjunction with Boston Properties Limited Partnership’s offering of its 2.750% senior unsecured notes due 2026, the Company terminated the forward-starting interest rate swap contracts and cash-settled the contracts by making cash payments to the counterparties aggregating approximately $49.3 million. The Company recognized approximately $0.1 million of losses on interest rate contracts during the year ended December 31, 2016 related to the partial ineffectiveness of the interest rate contracts. The Company is reclassifying into earnings, as an increase to interest expense, approximately $49.2 million (or approximately $4.9 million per year over the 10-year term of the 2.750% senior unsecured notes due 2026) of the amounts recorded in the consolidated balance sheets within accumulated other comprehensive loss, which represents the effective portion of the applicable interest rate contracts. In addition, 767 Fifth Partners LLC, which is a subsidiary of the consolidated entity in which the Company has a 60% interest and owns 767 Fifth Avenue (the General Motors Building) in New York City, entered into 16 forward-starting interest rate swap contracts (including two contracts entered into during the six months ended June 30, 2016 with notional amounts aggregating $50.0 million) that fix the 10-year swap rate at a weighted-average rate of approximately 2.619% per annum on notional amounts aggregating $450.0 million. These interest rate swap contracts were entered into in advance of a financing with a target commencement date in June 2017 and maturity in June 2027. On April 24, 2017, the consolidated entity that owns 767 Fifth Avenue (the General Motors Building) located in New York City entered into an interest rate lock and commitment agreement with a group of lenders on a ten-year financing totaling $2.3 billion at a fixed interest rate of 3.43% per annum (See Note 5). In conjunction with the interest rate lock and commitment agreement, 767 Fifth Partners LLC terminated the forward-starting interest rate swap contracts and cash-settled the contracts by making cash payments to the counterparties aggregating approximately $14.4 million. 767 Fifth Partners LLC did not record any hedge ineffectiveness. The Company is reclassifying into earnings, as an increase to interest expense, approximately $14.4 million (or approximately $1.4 million per year over the 10-year term of the financing) of the amounts recorded in the Consolidated Balance Sheets within Accumulated Other Comprehensive Loss, which represents the effective portion of the applicable interest rate contracts. 767 Fifth Partners LLC’s interest rate swap contracts consisted of the following at December 31, 2016 (dollars in thousands):
Boston Properties Limited Partnership entered into the interest rate swap contracts designated and qualifying as cash flow hedges to reduce its exposure to the variability in future cash flows attributable to changes in the 10-year swap rate in contemplation of obtaining 10-year fixed-rate financing in September 2016. The Company’s 767 Fifth Partners LLC consolidated entity entered into the interest rate swap contracts designated and qualifying as cash flow hedges to reduce its exposure to the variability in future cash flows attributable to changes in the 10-year swap rate in contemplation of obtaining 10-year fixed-rate financing in June 2017. Boston Properties Limited Partnership has formally documented all of its relationships between hedging instruments and hedged items, as well as its risk-management objective and strategy for undertaking various hedge transactions. Boston Properties Limited Partnership also assesses and documents, both at the hedging instrument’s inception and on an ongoing basis, whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in cash flows associated with the hedged items. All components of the forward-starting interest rate swap contracts were included in the assessment of hedge effectiveness. The Company accounts for the effective portion of changes in the fair value of a derivative in accumulated other comprehensive loss and subsequently reclassifies the effective portion to earnings over the term that the hedged transaction affects earnings. The Company accounts for the ineffective portion of changes in the fair value of a derivative directly in earnings. The Company classifies cash flows related to derivative instruments within its Consolidated Statements of Cash Flows consistent with the nature of the hedged item. The following table presents the location in the financial statements of the losses recognized related to the Company’s cash flow hedges for the three and six months ended June 30, 2017 and 2016:
Boston Properties, Inc. The following table reflects the changes in accumulated other comprehensive loss for the six months ended June 30, 2017 and 2016 (in thousands):
Boston Properties Limited Partnership The following table reflects the changes in accumulated other comprehensive loss for the six months ended June 30, 2017 and 2016 (in thousands):
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Commitments And Contingencies |
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Commitments and Contingencies Disclosure [Abstract] | |
Commitments And Contingencies | 7. Commitments and Contingencies General In the normal course of business, the Company guarantees its performance of services or indemnifies third parties against its negligence. In addition, in the normal course of business, the Company guarantees to certain tenants the obligations of its subsidiaries for the payment of tenant improvement allowances and brokerage commissions in connection with their leases and limited costs arising from delays in delivery of their premises. The Company has letter of credit and performance obligations related to lender and development requirements that total approximately $7.4 million. Certain of the Company’s joint venture agreements include provisions whereby, at certain specified times, each partner has the right to initiate a purchase or sale of its interest in the joint ventures. With limited exception, under these provisions, the Company is not compelled to purchase the interest of its outside joint venture partners. Under certain of the Company’s joint venture agreements, if certain return thresholds are achieved, the partners will be entitled to an additional promoted interest or payments. From time to time, the Company (or ventures in which the Company has an ownership interest) has agreed, and may in the future agree, to (1) guarantee portions of the principal, interest and other amounts in connection with their borrowings, (2) provide customary environmental indemnifications and nonrecourse carve-outs (e.g., guarantees against fraud, misrepresentation and bankruptcy) in connection with their borrowings and (3) provide guarantees to lenders and other third parties for the completion of development projects. The Company has agreements with its outside partners whereby the partners agree to reimburse the joint venture for their share of any payments made under the guarantee. In some cases, the Company earns a fee from the applicable joint venture for providing the guarantee. In connection with the refinancing of 767 Fifth Avenue’s (the General Motors Building) secured loan by the Company’s consolidated joint venture entity, 767 Venture, LLC, the Company 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 June 30, 2017, the maximum funding obligation under the guarantee was approximately $263.8 million. The Company earns a fee from the joint venture for providing the guarantee and has an agreement with the outside partners to reimburse the joint venture for their share of any payments made under the guarantee. As of June 30, 2017, no amounts related to the guarantee are recorded as liabilities in the Company’s consolidated financial statements. In 2009, the Company filed a general unsecured creditor’s claim against Lehman Brothers, Inc. for approximately $45.3 million related to its rejection of a lease at 399 Park Avenue in New York City. On January 10, 2014, the trustee for the liquidation of the business of Lehman Brothers allowed the Company’s claim in the amount of approximately $45.2 million. During 2014 and 2015, the Company received distributions of approximately $7.7 million and $8.1 million, respectively. On July 5, 2016, the Company received a fourth interim distribution totaling approximately $1.4 million. On May 19, 2017, the Company received a fifth interim distribution totaling approximately $0.4 million, leaving a remaining claim of approximately $27.6 million. The Company will continue to evaluate whether to attempt to sell the remaining claim or wait until the trustee distributes proceeds from the Lehman Brothers estate. Given the inherent uncertainties in bankruptcy proceedings, there can be no assurance as to the timing or amount of additional proceeds, if any, that the Company may ultimately realize on the remaining claim, whether by sale to a third party or by one or more distributions from the trustee. Accordingly, the Company has not recorded any estimated recoveries associated with this gain contingency within its Consolidated Financial Statements at June 30, 2017. Insurance The Company carries insurance coverage on its properties, including those under development, of types and in amounts and with deductibles that it believes are in line with coverage customarily obtained by owners of similar properties. Certain properties owned in joint ventures with third parties are insured by the third party partner with insurance coverage of types and in amounts and with deductibles the Company believes are in line with coverage customarily obtained by owners of similar properties. In response to the uncertainty in the insurance market following the terrorist attacks of September 11, 2001, the Federal Terrorism Risk Insurance Act (as amended, “TRIA”) was enacted in November 2002 to require regulated insurers to make available coverage for “certified” acts of terrorism (as defined by the statute). The expiration date of TRIA was extended to December 31, 2014 by the Terrorism Risk Insurance Program Reauthorization Act of 2007 and further extended to December 31, 2020 by the Terrorism Risk Insurance Program Reauthorization Act of 2015 (“TRIPRA”), and the Company can provide no assurance that it will be extended further. Currently, the Company’s property insurance program per occurrence limits are $1.0 billion for its portfolio insurance program, including coverage for acts of terrorism other than nuclear, biological, chemical or radiological terrorism (“Terrorism Coverage”). The Company also carries $250 million of Terrorism Coverage for 601 Lexington Avenue, New York, New York (“601 Lexington Avenue”) in excess of the $1.0 billion of coverage in the Company’s property insurance program. 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. The Company also currently carries nuclear, biological, chemical and radiological terrorism insurance coverage for acts of terrorism certified under 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 the Company manages. The per occurrence limit for NBCR Coverage is $1.0 billion. 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.” In 2017, the program trigger is $140 million and the coinsurance is 17%, however, both will increase in subsequent years pursuant to TRIPRA. If the Federal Government pays out for a loss under TRIA, it is mandatory that the Federal Government recoup the full amount of the loss from insurers offering TRIA coverage after the payment of the loss pursuant to a formula in TRIPRA. The Company may elect to terminate the NBCR Coverage if the Federal Government seeks recoupment for losses paid under TRIA, if there is a change in its portfolio or for any other reason. The Company intends to continue to monitor the scope, nature and cost of available terrorism insurance and maintain terrorism insurance in amounts and on terms that are commercially reasonable. The Company also currently carries earthquake insurance on its properties located in areas known to be subject to earthquakes in an amount and subject to self-insurance that the Company believes is commercially reasonable. In addition, this insurance is subject to a deductible in the amount of 3% of the value of the affected property. Specifically, the Company currently carries earthquake insurance which covers its San Francisco (including Salesforce Tower) and Los Angeles regions with a $240 million (increased from $170 million on March 1, 2017) per occurrence limit, and a $240 million (increased from $170 million on March 1, 2017) annual aggregate limit, $20 million of which is provided by IXP, as a direct insurer. Prior to March 1, 2017, the builders risk policy maintained for the development of Salesforce Tower in San Francisco included a $60 million per occurrence and annual aggregate limit of earthquake coverage. The amount of the Company’s earthquake insurance coverage may not be sufficient to cover losses from earthquakes. In addition, the amount of earthquake coverage could impact the Company’s ability to finance properties subject to earthquake risk. The Company may discontinue earthquake insurance or change the structure of its earthquake insurance program on some or all of its properties in the future if the premiums exceed the Company’s estimation of the value of the coverage. IXP, a captive insurance company which is a wholly-owned subsidiary of the Company, acts as a direct insurer with respect to a portion of the Company’s earthquake insurance coverage for its Greater San Francisco and Los Angeles properties and the Company’s NBCR Coverage. Insofar as the Company owns IXP, it is responsible for its liquidity and capital resources, and the accounts of IXP are part of the Company’s consolidated financial statements. In particular, if a loss occurs which is covered by the Company’s NBCR Coverage but is less than the applicable program trigger under TRIA, IXP would be responsible for the full amount of the loss without any backstop by the Federal Government. IXP would also be responsible for any recoupment charges by the Federal Government in the event losses are paid out and its insurance policy is maintained after the payout by the Federal Government. If the Company experiences a loss and IXP is required to pay under its insurance policy, the Company would ultimately record the loss to the extent of the required payment. Therefore, insurance coverage provided by IXP should not be considered as the equivalent of third-party insurance, but rather as a modified form of self-insurance. In addition, Boston Properties Limited Partnership has issued a guarantee to cover liabilities of IXP in the amount of $20.0 million. The mortgages on the Company’s properties typically contain requirements concerning the financial ratings of the insurers who provide policies covering the property. The Company provides the lenders on a regular basis with the identity of the insurance companies in the Company’s insurance programs. The ratings of some of the Company’s insurers are below the rating requirements in some of the Company’s loan agreements and the lenders for these loans could attempt to claim that an event of default has occurred under the loan. The Company believes it could obtain insurance with insurers which satisfy the rating requirements. Additionally, in the future, the Company’s ability to obtain debt financing secured by individual properties, or the terms of such financing, may be adversely affected if lenders generally insist on ratings for insurers or amounts of insurance which are difficult to obtain or which result in a commercially unreasonable premium. There can be no assurance that a deficiency in the financial ratings of one or more of the Company’s insurers will not have a material adverse effect on the Company. The Company continues to monitor the state of the insurance market in general, and the scope and costs of coverage for acts of terrorism and California earthquake risk in particular, but the Company cannot anticipate what coverage will be available on commercially reasonable terms in future policy years. There are other types of losses, such as from wars, for which the Company cannot obtain insurance at all or at a reasonable cost. With respect to such losses and losses from acts of terrorism, earthquakes or other catastrophic events, if the Company experiences a loss that is uninsured or that exceeds policy limits, the Company could lose the capital invested in the damaged properties, as well as the anticipated future revenues from those properties. Depending on the specific circumstances of each affected property, it is possible that the Company could be liable for mortgage indebtedness or other obligations related to the property. Any such loss could materially and adversely affect the Company’s business and financial condition and results of operations. |
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Noncontrolling Interest [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Noncontrolling Interests | 8. Noncontrolling Interests Noncontrolling interests relate to the interests in Boston Properties Limited Partnership not owned by Boston Properties, Inc. and interests in consolidated property partnerships not wholly-owned by the Company. As of June 30, 2017, the noncontrolling interests in Boston Properties Limited Partnership consisted of 16,823,685 OP Units, 816,982 LTIP Units (including 118,067 2012 OPP Units, 85,405 2013 MYLTIP Units and 25,107 2014 MYLTIP Units), 366,618 2015 MYLTIP Units, 473,360 2016 MYLTIP Units and 400,000 2017 MYLTIP Units held by parties other than Boston Properties, Inc. Noncontrolling Interest—Common Units During the six months ended June 30, 2017, 481,261 OP Units were presented by the holders for redemption (including 22,110 OP Units issued upon conversion of LTIP Units, 2012 OPP Units, 2013 MYLTIP Units and 2014 MYLTIP Units) and were redeemed by Boston Properties, Inc. in exchange for an equal number of shares of Common Stock. At June 30, 2017, Boston Properties Limited Partnership had outstanding 366,618 2015 MYLTIP Units, 473,360 2016 MYLTIP Units and 400,000 2017 MYLTIP Units. Prior to the applicable measurement date (February 4, 2018 for 2015 MYLTIP Units, February 9, 2019 for 2016 MYLTIP Units and February 6, 2020 for 2017 MYLTIP Units), holders of MYLTIP Units will be entitled to receive per unit distributions equal to one-tenth (10%) of the regular quarterly distributions payable on an OP Unit, but will not be entitled to receive any special distributions. After the measurement date, the number of MYLTIP Units, both vested and unvested, that MYLTIP award recipients have earned, if any, based on the establishment of a performance pool, will be entitled to receive distributions in an amount per unit equal to distributions, both regular and special, payable on an OP Unit. On February 3, 2017, the measurement period for the Company’s 2014 MYLTIP awards ended and, based on Boston Properties, Inc.’s relative TSR performance, the final awards were determined to be 27.7% of target or an aggregate of approximately $3.5 million (after giving effect to voluntary employee separations and the unallocated reserve). As a result, an aggregate of 447,386 2014 MYLTIP Units that had been previously granted were automatically forfeited. The following table presents Boston Properties Limited Partnership’s distributions on the OP Units and LTIP Units (including the 2012 OPP Units and 2013 MYLTIP Units and, after the February 3, 2017 measurement date, the 2014 MYLTIP Units) and its distributions on the 2014 MYLTIP Units (prior to the February 3, 2017 measurement date), 2015 MYLTIP Units, 2016 MYLTIP Units and 2017 MYLTIP Units (after the February 7, 2017 issuance date) paid in 2017:
A holder of an OP Unit may present the OP Unit to Boston Properties Limited Partnership for redemption at any time (subject to restrictions agreed upon at the time of issuance of OP Units to particular holders that may restrict such redemption right for a period of time, generally one year from issuance). Upon presentation of an OP Unit for redemption, Boston Properties Limited Partnership must redeem the OP Unit for cash equal to the then value of a share of common stock of Boston Properties, Inc. Boston Properties, Inc. may, in its sole discretion, elect to assume and satisfy the redemption obligation by paying either cash or issuing one share of Common Stock. The value of the OP Units not owned by Boston Properties, Inc. and LTIP Units (including the 2012 OPP Units, 2013 MYLTIP Units and 2014 MYLTIP Units), assuming that all conditions had been met for the conversion thereof, had all of such units been redeemed at June 30, 2017 was approximately $2.2 billion based on the last reported price of a share of Common Stock on the New York Stock Exchange of $123.02 per share on June 30, 2017. Boston Properties Limited Partnership The following table reflects the activity of noncontrolling interests—redeemable partnership units of Boston Properties Limited Partnership for the six months ended June 30, 2017 and 2016 (in thousands):
Noncontrolling Interests—Property Partnerships The noncontrolling interests in property partnerships consist of the outside equity interests in ventures that are consolidated with the financial results of the Company because the Company exercises control over the entities that own the properties. The equity interests in these ventures that are not owned by the Company, totaling approximately $1.7 billion at June 30, 2017 and $1.5 billion at December 31, 2016, are included in Noncontrolling Interests—Property Partnerships in the accompanying Consolidated Balance Sheets. On May 12, 2016, the partners in the Company’s consolidated entity that owns Salesforce Tower located in San Francisco, California amended the venture agreement. Under the venture agreement, if the Company elects to fund the construction of Salesforce Tower without a construction loan (or a construction loan of less than 50% of project costs) and the venture has commenced vertical construction of the project, then the partner’s capital funding obligation shall be limited, in which event the Company shall fund up to 2.5% of the total project costs (i.e., 50% of the partner’s 5% interest in the venture) in the form of a loan to the partner. This loan would bear interest at the then prevailing market interest rates for construction loans. Under the amended agreement, the partners have agreed to structure this funding by the Company as preferred equity rather than a loan. The preferred equity contributed by the Company shall earn a preferred return equal to LIBOR plus 3.00% per annum and shall be payable to the Company out of any distributions to which the partner would otherwise be entitled until such preferred equity and preferred return have been repaid to the Company. As of June 30, 2017, the Company had contributed an aggregate of approximately $13.5 million of preferred equity to the venture. On June 6, 2017, in conjunction with the refinancing of the indebtedness of the Company’s consolidated entity in which it has a 60% interest and that owns 767 Fifth Avenue (the General Motors Building) located in New York City, the members of the consolidated entity amended the limited liability company agreement to provide for the contribution of the remaining unpaid principal balance of the members’ notes payable totaling approximately $273.9 million (of which the Company’s share of approximately $164.4 million is eliminated in consolidation) to equity in the consolidated entity, resulting in an increase of approximately $109.6 million to Noncontrolling Interests in Property Partnerships on the Company’s Consolidated Balance Sheets (See Note 5). There were no changes to the ownership interests or rights of the members as a result of the amendment. The following table reflects the activity of the noncontrolling interests in property partnerships for the six months ended June 30, 2017 and 2016 (in thousands):
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Stockholders' Equity / Partners' Capital | 9. Stockholders’ Equity / Partners’ Capital As of June 30, 2017, Boston Properties, Inc. had 154,307,529 shares of Common Stock outstanding. As of June 30, 2017, Boston Properties, Inc. owned 1,719,482 general partnership units and 152,588,047 limited partnership units of Boston Properties Limited Partnership. On June 2, 2017, Boston Properties, Inc. renewed its “at the market” (“ATM”) stock offering program through which it may sell from time to time up to an aggregate of $600.0 million of its common stock through sales agents over a three-year period. This program replaces the Company’s prior $600.0 million ATM stock offering program that was scheduled to expire on June 3, 2017. The Company intends to use the net proceeds from any offering for general business purposes, which may include investment opportunities and debt reduction. No shares of common stock have been issued under this ATM stock offering program. During the six months ended June 30, 2017, Boston Properties, Inc. issued 481,261 shares of Common Stock in connection with the redemption of an equal number of redeemable OP Units from third parties. The following table presents Boston Properties, Inc.’s dividends per share and Boston Properties Limited Partnership’s distributions per OP Unit and LTIP Unit paid in 2017:
Preferred Stock As of June 30, 2017, Boston Properties, Inc. had 80,000 shares (8,000,000 depositary shares each representing 1/100th of a share) outstanding of its 5.25% Series B Cumulative Redeemable Preferred Stock with a liquidation preference of $2,500.00 per share ($25.00 per depositary share). Boston Properties, Inc. pays cumulative cash dividends on the Series B Preferred Stock at a rate of 5.25% per annum of the $2,500.00 liquidation preference per share. Boston Properties, Inc. may not redeem the Series B Preferred Stock prior to March 27, 2018, except in certain circumstances relating to the preservation of Boston Properties, Inc.’s REIT status. On or after March 27, 2018, Boston Properties, Inc., at its option, may redeem the Series B Preferred Stock for a cash redemption price of $2,500.00 per share ($25.00 per depositary share), plus all accrued and unpaid dividends. The Series B Preferred Stock is not redeemable by the holders, has no maturity date and is not convertible into any other security of Boston Properties, Inc. or its affiliates. The following table presents Boston Properties Inc.’s dividends per share on its outstanding Series B Preferred Stock paid during 2017:
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Earnings Per Share / Common Unit |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share / Common Unit | 10. Earnings Per Share / Common Unit Boston Properties, Inc. The following table provides a reconciliation of both the net income attributable to Boston Properties, Inc. common shareholders and the number of common shares used in the computation of basic earnings per share (“EPS”), which is calculated by dividing net income attributable to Boston Properties, Inc. common shareholders by the weighted-average number of common shares outstanding during the period. Unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are also participating securities. As such, unvested restricted common stock of the Company, LTIP Units, 2012 OPP Units and MYLTIP Units are considered participating securities. Participating securities are included in the computation of basic EPS of the Company using the two-class method. Participating securities are included in the computation of diluted EPS of the Company using the if-converted method if the impact is dilutive. Because the 2012 OPP Units, 2013 MYLTIP Units and 2014 MYLTIP Units required, and the 2015-2017 MYLTIP Units require, the Company to outperform absolute and relative return thresholds, unless such thresholds have been met by the end of the applicable reporting period, the Company excludes such units from the diluted EPS calculation. Other potentially dilutive common shares, including stock options, restricted stock and other securities of Boston Properties Limited Partnership that are exchangeable for the Boston Properties, Inc.’s Common Stock, and the related impact on earnings, are considered when calculating diluted EPS.
Boston Properties Limited Partnership The following table provides a reconciliation of both the net income attributable to Boston Properties Limited Partnership common unitholders and the number of common units used in the computation of basic earnings per common unit, which is calculated by dividing net income attributable to Boston Properties Limited Partnership common unitholders by the weighted-average number of common units outstanding during the period. Unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are also participating securities. As such, unvested restricted common stock of Boston Properties, Inc. and Boston Properties Limited Partnership’s LTIP Units, 2012 OPP Units and MYLTIP Units are considered participating securities. Participating securities are included in the computation of basic earnings per common unit using the two-class method. Participating securities are included in the computation of diluted earnings per common unit using the if-converted method if the impact is dilutive. Because the 2012 OPP Units, 2013 MYLTIP Units and 2014 MYLTIP Units required, and the 2015-2017 MYLTIP Units require, Boston Properties, Inc. to outperform absolute and relative return thresholds, unless such thresholds have been met by the end of the applicable reporting period, Boston Properties Limited Partnership excludes such units from the diluted earnings per common unit calculation. Other potentially dilutive common units and the related impact on earnings are considered when calculating diluted earnings per common unit. Included in the number of units (the denominator) below are approximately 17,498,000 and 17,708,000 redeemable common units for the three months ended June 30, 2017 and 2016, respectively, and 17,609,000 and 17,695,000 redeemable common units for the six months ended June 30, 2017 and 2016, respectively.
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Stock Option and Incentive Plan |
6 Months Ended |
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Jun. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock Option and Incentive Plan | 11. Stock Option and Incentive Plan On January 25, 2017, Boston Properties, Inc.’s Compensation Committee approved the 2017 MYLTIP awards under Boston Properties, Inc.’s 2012 Stock Option and Incentive Plan (the “2012 Plan”) to certain officers and employees of Boston Properties, Inc. The 2017 MYLTIP awards utilize Boston Properties, Inc.’s total stockholder return (“TSR”) over a three-year measurement period, on an annualized, compounded basis, as the performance metric. Earned awards will be based on Boston Properties, Inc.’s TSR relative to (i) the Cohen & Steers Realty Majors Portfolio Index (50% weight) and (ii) the NAREIT Office Index adjusted to include Vornado Realty Trust (50% weight). Earned awards will range from zero to a maximum of approximately $42.7 million depending on Boston Properties, Inc.’s TSR relative to the two indices, with four tiers (threshold: approximately $10.7 million; target: approximately $21.3 million; high: approximately $32.0 million; exceptional: approximately $42.7 million) and linear interpolation between tiers. Earned awards measured on the basis of relative TSR performance are subject to an absolute TSR component in the form of relatively simple modifiers that (A) reduce the level of earned awards in the event Boston Properties, Inc.’s annualized TSR is less than 0% and (B) cause some awards to be earned in the event Boston Properties, Inc.’s annualized TSR is more than 12% even though on a relative basis alone Boston Properties, Inc.’s TSR would not result in any earned awards. Earned awards (if any) will vest 50% on February 6, 2020 and 50% on February 6, 2021, based on continued employment. Vesting will be accelerated in the event of a change in control, termination of employment by Boston Properties, Inc. without cause, or termination of employment by the award recipient for good reason, death, disability or retirement. If there is a change of control prior to February 6, 2020, earned awards will be calculated based on TSR performance up to the date of the change of control. The 2017 MYLTIP awards are in the form of LTIP Units issued on the grant date which (i) are subject to forfeiture to the extent awards are not earned and (ii) prior to the performance measurement date are only entitled to one-tenth (10%) of the regular quarterly distributions payable on common partnership units and no special distributions. Under ASC 718, the 2017 MYLTIP awards have an aggregate value of approximately $17.7 million, which amount will generally be amortized into earnings over the four-year plan period under the graded vesting method. On February 3, 2017, the measurement period for the Company’s 2014 MYLTIP awards ended and, based on Boston Properties, Inc.’s relative TSR performance, the final awards were determined to be 27.7% of target or an aggregate of approximately $3.5 million (after giving effect to voluntary employee separations and the unallocated reserve). As a result, an aggregate of 447,386 2014 MYLTIP Units that had been previously granted were automatically forfeited. During the six months ended June 30, 2017, Boston Properties, Inc. issued 37,414 shares of restricted common stock and Boston Properties Limited Partnership issued 111,488 LTIP Units and 400,000 2017 MYLTIP Units to employees and non-employee directors under the 2012 Plan. Employees and non-employee directors paid $0.01 per share of restricted common stock and $0.25 per LTIP Unit and 2017 MYLTIP Unit. When issued, LTIP Units are not economically equivalent in value to a share of Common Stock, but over time can increase in value to one-for-one parity with Common Stock if there is sufficient appreciation in the value of the Company’s assets. The aggregate value of the LTIP Units is included in noncontrolling interests in the Consolidated Balance Sheets. Grants of restricted stock and LTIP Units to employees vest in four equal annual installments. Restricted stock is measured at fair value on the date of grant based on the number of shares granted and the closing price of Boston Properties, Inc.’s Common Stock on the date of grant as quoted on the New York Stock Exchange. Such value is recognized as an expense ratably over the corresponding employee service period. The shares of restricted stock granted during the six months ended June 30, 2017 were valued at approximately $4.9 million ($130.32 per share weighted-average). The LTIP Units granted were valued at approximately $13.3 million (approximately $119.52 per unit weighted-average fair value) using a Monte Carlo simulation method model. The per unit fair values of the LTIP Units granted were estimated on the dates of grant and for a substantial majority of such units were valued using the following assumptions: an expected life of 5.7 years, a risk-free interest rate of 2.14% and an expected price volatility of 28.0%. As the 2012 OPP Units, 2013 MYLTIP Units, 2014 MYLTIP Units, 2015 MYLTIP Units, 2016 MYLTIP Units and 2017 MYLTIP Units are subject to both a service condition and a market condition, the Company recognizes the compensation expense related to the 2012 OPP Units, 2013 MYLTIP Units, 2014 MYLTIP Units, 2015 MYLTIP Units, 2016 MYLTIP Units and 2017 MYLTIP Units under the graded vesting attribution method. Under the graded vesting attribution method, each portion of the award that vests at a different date is accounted for as a separate award and recognized over the period appropriate to that portion so that the compensation cost for each portion should be recognized in full by the time that portion vests. The Company recognizes forfeitures as they occur on its awards of stock-based compensation (See Note 2). Dividends paid on both vested and unvested shares of restricted stock are charged directly to Dividends in Excess of Earnings in Boston Properties, Inc.’s Consolidated Balance Sheets and Partners’ Capital in Boston Properties Limited Partnership’s Consolidated Balance Sheets. Aggregate stock-based compensation expense associated with restricted stock, non-qualified stock options, LTIP Units, 2012 OPP Units, 2013 MYLTIP Units, 2014 MYLTIP Units, 2015 MYLTIP Units, 2016 MYLTIP Units and 2017 MYLTIP Units was approximately $7.9 million and $7.1 million for the three months ended June 30, 2017 and 2016, respectively, and $18.1 million and $16.5 million for the six months ended June 30, 2017 and 2016, respectively. At June 30, 2017, there was $26.8 million of unrecognized compensation expense related to unvested restricted stock, LTIP Units, 2013 MYLTIP Units and 2014 MYLTIP Units and $28.5 million of unrecognized compensation expense related to unvested 2015 MYLTIP Units, 2016 MYLTIP Units and 2017 MYLTIP Units that is expected to be recognized over a weighted-average period of approximately 2.7 years. |
Segment Information |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information | 12. Segment Information The following tables present reconciliations of Net Income Attributable to Boston Properties, Inc. Common Shareholders to Net Operating Income and Net Income Attributable to Boston Properties Limited Partnership Common Unitholders to Net Operating Income for the three and six months ended June 30, 2017 and 2016. Boston Properties, Inc.
Boston Properties Limited Partnership
Net operating income (“NOI”) is a non-GAAP financial measure equal to net income attributable to Boston Properties, Inc. common shareholders and net income attributable to Boston Properties Limited Partnership common unitholders, the most directly comparable GAAP financial measures, plus (1) preferred dividends/distributions, noncontrolling interests, interest expense, depreciation and amortization expense, transaction costs and general and administrative expense less (2) gains on sales of real estate, gains from early extinguishments of debt, gains from investments in securities, interest and other income, income from unconsolidated joint ventures and development and management services revenue. The Company believes NOI is useful to investors as a performance measure and believes it provides useful information to investors regarding its financial condition and results of operations 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. common shareholders or net income attributable to Boston Properties Limited Partnership common unitholders. For example, interest expense is not necessarily linked to the operating performance of a real estate asset and is often incurred at the corporate level as opposed to the property level. Similarly, interest expense may be incurred at the property level even though the financing proceeds may be used at the corporate level (e.g., for other investment activity). In addition, because of historical cost accounting and useful life estimates, depreciation and amortization may distort operating performance measures at the property level. NOI presented by the Company may not be comparable to NOI reported by other REITs or real estate companies that define NOI differently. 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. Preferred dividends/distributions, noncontrolling interests, gains on sales of real estate, interest expense, gains from early extinguishments of debt, gains from investments in securities, interest and other income, income from unconsolidated joint ventures, depreciation and amortization expense, transaction costs, general and administrative expenses and development and management services revenue are not included in Net Operating Income as internal reporting addresses these items on a corporate level. 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, San Francisco and Washington, DC. Segments by property type include: Office, Residential and Hotel. Information by geographic area and property type (dollars in thousands): For the three months ended June 30, 2017:
For the three months ended June 30, 2016:
For the six months ended June 30, 2017:
For the six months ended June 30, 2016:
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Subsequent Events |
6 Months Ended |
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Jun. 30, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | 13. Subsequent Events On July 26, 2017, a joint venture between the Company and The Bernstein Companies entered into a build-to-suit lease agreement with an affiliate of Marriott International, Inc. under which Marriott will lease 100% of an approximately 720,000 square foot office building and below-grade parking garage to be constructed by the joint venture at 7750 Wisconsin Avenue in Bethesda, Maryland. The joint venture will lease the office building to Marriott for 20 years on a net basis and will serve as Marriott’s world-wide headquarters. The Company and The Bernstein Companies will each own a 50% interest in the joint venture. The Company will serve as development manager for the venture and expects to commence construction in 2018. Marriott has agreed to fund 100% of the related tenant improvement costs and leasing commissions for the office building. On July 28, 2017, a joint venture in which the Company has a 50% interest obtained mortgage financing collateralized by its Colorado Center property totaling $550.0 million. The mortgage financing bears interest at a fixed rate of 3.56% per annum and matures on August 9, 2027. The loan requires interest-only payments during the 10-year term of the loan, with the entire principal amount due at maturity. Colorado Center is a six-building office complex that sits on a 15-acre site and contains an aggregate of approximately 1,184,000 net rentable square feet with an underground parking garage for 3,100 vehicles located in Santa Monica, California. |
Basis Of Presentation And Summary Of Significant Accounting Policies Recent Accounting Pronouncements (Policies) |
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Jun. 30, 2017 | |
Recent Accounting Pronouncements [Abstract] | |
Recent Accounting Pronouncement [Policy Text Block] | Recent Accounting Pronouncements In May 2014, the Financial Standards Accounting Board (“FASB”) issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”). The objective of ASU 2014-09 is to establish a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and will supersede most of the existing revenue recognition guidance, including industry-specific guidance. The core principle is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In applying ASU 2014-09, companies will perform a five-step analysis of transactions to determine when and how revenue is recognized. ASU 2014-09 applies to all contracts with customers except those that are within the scope of other topics in the FASB’s ASC. In August 2015, the FASB issued ASU 2015-14, “Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date” (“ASU 2015-14”), which delayed the effective date of ASU 2014-09 by one year making it effective for the first interim period within annual reporting periods beginning after December 15, 2017. Early adoption is permitted as of the original effective date. In May 2016, the FASB issued ASU No. 2016-12, “Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients” (“ASU 2016-12”). ASU 2016-12 is intended to clarify and provide practical expedients for certain aspects of ASU 2014-09, which outlines a single comprehensive model for entities to use in accounting for revenues arising from contracts with customers and notes that lease contracts with customers are a scope exception. The Company may elect to adopt ASU 2016-12 as of the original effective date; however, adoption is required for annual reporting periods beginning after December 15, 2017. The Company will adopt ASU 2014-09 effective January 1, 2018 using the modified retrospective approach. The Company’s project team has completed the compilation of the inventory of the sources of revenue that will be impacted by the adoption of ASU 2014-09. The Company expects that executory costs and certain non-lease components of revenue from leases (upon the adoption of ASU 2016-02), tenant service revenue, development and management services revenue, parking revenue and gains on sales of real estate may be impacted by the adoption of ASU 2014-09, although the Company anticipates that the impact will be to the pattern of revenue recognition and not the total revenue recognized over time. The Company is making progress in evaluating the significance of the impact on the changes in the recognition pattern of its revenue and is still completing its assessment of the overall impact of adopting ASU 2014-09. In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842)” (“ASU 2016-02”), which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e., lessees and lessors). ASU 2016-02 requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase of the leased asset by the lessee. This classification will determine whether the lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases today. The new standard requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales-type leases, direct financing leases and operating leases. ASU 2016-02 supersedes previous leasing standards. ASU 2016-02 is effective for the Company for reporting periods beginning after December 15, 2018, with early adoption permitted. The Company has commenced the process of adopting ASU 2016-02 by forming a project team and beginning to compile an inventory of its leases that will be impacted by the adoption of ASU 2016-02. The Company is still assessing the impact of adopting ASU 2016-02. However, the Company expects that its operating leases where it is the lessor will be accounted for on its balance sheet similar to its current accounting with the underlying leased asset recognized as real estate. The Company expects that executory costs and certain other non-lease components will need to be accounted for separately from the lease component of the lease with the lease component continuing to be recognized on a straight-line basis over the lease term and the executory costs and certain other non-lease components being accounted for under the new revenue recognition guidance in ASU 2014-09. For leases in which the Company is the lessee, primarily consisting of ground leases, the Company expects to recognize a right-of-use asset and a lease liability equal to the present value of the minimum lease payments with rental payments being applied to the lease liability and to interest expense and the right-of-use asset being amortized to expense on a straight-line basis over the term of the lease. In addition, under ASU 2016-02, lessors may only capitalize incremental direct leasing costs. As a result, the Company expects that it will no longer be able to capitalize its internal leasing wages and instead will expense these costs as incurred. In March 2016, the FASB issued ASU 2016-09, “Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting” (“ASU 2016-09”). ASU 2016-09 is intended to improve the accounting for share-based payments and affects all organizations that issue share-based payment awards to their employees. Several aspects of the accounting for share-based payment awards are simplified with ASU 2016-09, including income tax consequences, classification of awards as equity or liabilities and classification on the statement of cash flows. ASU 2016-09 is effective for the Company for reporting periods beginning after December 15, 2016, with early adoption permitted. On January 1, 2017, the Company adopted ASU 2016-09 and elected to make an accounting policy change to its method of accounting for forfeitures on its awards of stock-based compensation including the issuance of shares of restricted common stock, LTIP Units and MYLTIP Units. The Company now accounts for forfeitures as they occur instead of estimating the number of forfeitures upon the issuance of such awards of stock-based compensation. The adoption resulted in the Company recognizing cumulative effect of a change in accounting principle adjustments to its consolidated balance sheets totaling approximately $0.3 million to Dividends in Excess of Earnings and Partners’ Capital for Boston Properties, Inc. and Boston Properties Limited Partnership, respectively, and approximately $1.8 million to noncontrolling interests - common units of Boston Properties Limited Partnership and noncontrolling interests - redeemable partnership units for Boston Properties, Inc. and Boston Properties Limited Partnership, respectively. In January 2017, the FASB issued ASU 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business” (“ASU 2017-01”). ASU 2017-01 clarifies the framework for determining whether an integrated set of assets and activities meets the definition of a business. The revised framework establishes a screen for determining whether an integrated set of assets and activities is a business and narrows the definition of a business, which is expected to result in fewer transactions being accounted for as business combinations. Acquisitions of integrated sets of assets and activities that do not meet the definition of a business are accounted for as asset acquisitions. This update is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2017, with early adoption permitted for transactions that have not been reported in previously issued (or available to be issued) financial statements and shall be applied on a prospective basis. The Company early adopted ASU 2017-01 during the first quarter of 2017. The Company expects that acquisitions of real estate or in-substance real estate will not meet the revised definition of a business because substantially all of the fair value is concentrated in a single identifiable asset or group of similar identifiable assets (i.e. land, buildings, and related intangible assets) or because the acquisition does not include a substantive process in the form of an acquired workforce or an acquired contract that cannot be replaced without significant cost, effort or delay. In February 2017, the FASB issued ASU No. 2017-05, “Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets” (“ASU 2017-05”). ASU 2017-05 updates the definition of an “in substance nonfinancial asset” and clarifies the derecognition guidance for nonfinancial assets to conform with the new revenue recognition standard. The effective date and transition methods of ASU 2017-05 are aligned with ASU 2014-09 described above and are effective for the first interim period within annual reporting periods beginning after December 15, 2017. The Company is currently assessing the potential impact that the adoption of ASU 2017-05 will have on its consolidated financial statements. In May 2017, the FASB issued ASU 2017-09, “Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting” (“ASU 2017-09”). ASU 2017-09 is intended to provide clarity and reduce (1) diversity in practice, (2) cost and (3) complexity when applying the guidance in Topic 718 to a change to the terms or conditions of a share-based payment award. ASU 2017-09 is effective for public entities for fiscal years and interim periods beginning after December 15, 2017. The Company is currently assessing the potential impact that the adoption of ASU 2017-09 will have on its consolidated financial statements. |
Basis Of Presentation And Summary Of Significant Accounting Policies (Tables) |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Carrying Value Of Indebtedness And Corresponding Estimate Of Fair Value | The following table presents the aggregate carrying value of the Company’s mortgage notes payable, net, mezzanine notes payable and unsecured senior notes, net and the Company’s corresponding estimate of fair value as of June 30, 2017 and December 31, 2016 (in thousands):
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Real Estate Real Estate (Tables) |
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Schedule of Real Estate Properties [Table Text Block] | Boston Properties, Inc. Real estate consisted of the following at June 30, 2017 and December 31, 2016 (in thousands):
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Schedule of Real Estate Properties [Table Text Block] | Boston Properties Limited Partnership Real estate consisted of the following at June 30, 2017 and December 31, 2016 (in thousands):
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Capital Leases in Financial Statements of Lessee Disclosure [Text Block] | As of June 29, 2017, future minimum lease payments related to this capital lease are as follows (in thousands):
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Schedule of Business Acquisitions, by Acquisition [Table Text Block] |
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Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination [Table Text Block] |
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Investments in Unconsolidated Joint Ventures (Tables) |
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Investments In Unconsolidated Joint Ventures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments In Unconsolidated Joint Ventures | The investments in unconsolidated joint ventures consist of the following at June 30, 2017 and December 31, 2016:
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Schedule Of Balance Sheets Of The Unconsolidated Joint Ventures [Text Block] | The combined summarized balance sheets of the Company’s unconsolidated joint ventures are as follows:
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Statements Of Operations Of The Joint Ventures | The combined summarized statements of operations of the Company’s unconsolidated joint ventures are as follows:
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Derivative Instruments and Hedging Activities Derivative Instruments and Hedging Activities (Tables) |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Notional Amounts of Outstanding Derivative Positions [Table Text Block] | 767 Fifth Partners LLC’s interest rate swap contracts consisted of the following at December 31, 2016 (dollars in thousands):
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Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss) [Table Text Block] | The following table presents the location in the financial statements of the losses recognized related to the Company’s cash flow hedges for the three and six months ended June 30, 2017 and 2016:
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Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block] | Boston Properties, Inc. The following table reflects the changes in accumulated other comprehensive loss for the six months ended June 30, 2017 and 2016 (in thousands):
Boston Properties Limited Partnership The following table reflects the changes in accumulated other comprehensive loss for the six months ended June 30, 2017 and 2016 (in thousands):
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Noncontrolling Interests (Tables) |
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Distributions Declared to OP, LTIP, OPP and MYLTIP Units [Table Text Block] | The following table presents Boston Properties, Inc.’s dividends per share and Boston Properties Limited Partnership’s distributions per OP Unit and LTIP Unit paid in 2017:
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Schedule Of Noncontrolling Interest Common Units [Table Text Block] | The following table reflects the activity of noncontrolling interests—redeemable partnership units of Boston Properties Limited Partnership for the six months ended June 30, 2017 and 2016 (in thousands):
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Schedule Of Noncontrolling Interest Property Partnerships [Table Text Block] | The following table reflects the activity of the noncontrolling interests in property partnerships for the six months ended June 30, 2017 and 2016 (in thousands):
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Distributions Declared to OP, LTIP, OPP and MYLTIP Units [Table Text Block] | The following table presents Boston Properties Limited Partnership’s distributions on the OP Units and LTIP Units (including the 2012 OPP Units and 2013 MYLTIP Units and, after the February 3, 2017 measurement date, the 2014 MYLTIP Units) and its distributions on the 2014 MYLTIP Units (prior to the February 3, 2017 measurement date), 2015 MYLTIP Units, 2016 MYLTIP Units and 2017 MYLTIP Units (after the February 7, 2017 issuance date) paid in 2017:
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Stockholders' Equity / Partners' Capital Tables (Tables) |
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Dividends Declared [Table Text Block] | The following table presents Boston Properties, Inc.’s dividends per share and Boston Properties Limited Partnership’s distributions per OP Unit and LTIP Unit paid in 2017:
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Dividends Declared [Table Text Block] | The following table presents Boston Properties Inc.’s dividends per share on its outstanding Series B Preferred Stock paid during 2017:
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Earnings Per Share / Common Unit (Tables) |
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Entity Information [Line Items] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Computation Of Basic And Diluted Earnings Per Share |
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Boston Properties Limited Partnership | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Entity Information [Line Items] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Computation Of Basic And Diluted Earnings Per Share |
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Segment Information (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Reconciliation Of Net Operating Income To Net Income | The following tables present reconciliations of Net Income Attributable to Boston Properties, Inc. Common Shareholders to Net Operating Income and Net Income Attributable to Boston Properties Limited Partnership Common Unitholders to Net Operating Income for the three and six months ended June 30, 2017 and 2016. Boston Properties, Inc.
Boston Properties Limited Partnership
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Schedule Of Segment Information By Geographic Area And Property Type | Information by geographic area and property type (dollars in thousands): For the three months ended June 30, 2017:
For the three months ended June 30, 2016:
For the six months ended June 30, 2017:
For the six months ended June 30, 2016:
|
Basis Of Presentation And Summary Of Significant Accounting Policies (Narrative) (Details) $ in Thousands |
6 Months Ended |
---|---|
Jun. 30, 2017
USD ($)
| |
Entity Information [Line Items] | |
Cumulative effect of a change in accounting principle | $ 2,035 |
Boston Properties Limited Partnership | |
Entity Information [Line Items] | |
Cumulative effect of a change in accounting principle | 272 |
Dividends In Excess Of Earnings [Member] | |
Entity Information [Line Items] | |
Cumulative effect of a change in accounting principle | 272 |
Noncontrolling Interests [Member] | |
Entity Information [Line Items] | |
Cumulative effect of a change in accounting principle | 1,763 |
Noncontrolling Interests [Member] | Boston Properties Limited Partnership | |
Entity Information [Line Items] | |
Cumulative effect of a change in accounting principle | $ 1,763 |
Basis Of Presentation And Summary Of Significant Accounting Policies (Carrying Value Of Indebtedness And Corresponding Estimate Of Fair Value) (Details) - USD ($) $ in Thousands |
Jun. 30, 2017 |
Dec. 31, 2016 |
---|---|---|
Summary Of Significant Accounting Policies [Line Items] | ||
Mortgage notes payable, net | $ 2,986,283 | $ 2,063,087 |
Mezzanine notes payable | 0 | 307,093 |
Unsecured line of credit | 0 | 0 |
Unsecured senior notes, net | 7,250,356 | 7,245,953 |
Carrying Amount [Member] | ||
Summary Of Significant Accounting Policies [Line Items] | ||
Mortgage notes payable, net | 2,986,283 | 2,063,087 |
Mezzanine notes payable | 0 | 307,093 |
Unsecured senior notes, net | 7,250,356 | 7,245,953 |
Total | 10,236,639 | 9,616,133 |
Estimated Fair Value [Member] | ||
Summary Of Significant Accounting Policies [Line Items] | ||
Mortgage notes payable, net | 3,056,829 | 2,092,237 |
Mezzanine notes payable | 0 | 308,344 |
Unsecured senior notes, net | 7,516,131 | 7,428,077 |
Total | $ 10,572,960 | $ 9,828,658 |
Real Estate Narrative (Details) |
2 Months Ended | 3 Months Ended | 5 Months Ended | 6 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 13, 2017
USD ($)
ft²
|
Apr. 19, 2017
USD ($)
a
|
Jun. 30, 2017
USD ($)
|
Jun. 13, 2017
USD ($)
ft²
|
Jun. 30, 2017
USD ($)
|
Jun. 30, 2016
USD ($)
|
Jun. 13, 2017
USD ($)
ft²
|
Jun. 30, 2017
USD ($)
|
Jun. 30, 2016
USD ($)
|
Jun. 29, 2017
USD ($)
yr
apartments
|
May 27, 2017
ft²
|
May 15, 2017
USD ($)
ft²
|
Apr. 06, 2017
ft²
|
|
Real Estate [Line Items] | |||||||||||||
Revenues | $ 656,907,000 | $ 623,546,000 | $ 1,289,135,000 | $ 1,289,531,000 | |||||||||
Earnings | 238,690,000 | 218,124,000 | 444,915,000 | 468,477,000 | |||||||||
Proceeds from sales of real estate | 17,049,000 | 104,816,000 | |||||||||||
Gains on sales of real estate | 3,767,000 | 0 | 3,900,000 | 67,623,000 | |||||||||
145 Broadway [Member] | |||||||||||||
Real Estate [Line Items] | |||||||||||||
Net Rentable Area (in sf) | ft² | 485,000 | ||||||||||||
Reservoir Place North [Member] | |||||||||||||
Real Estate [Line Items] | |||||||||||||
Net Rentable Area (in sf) | ft² | 73,000 | ||||||||||||
MacArthur Transit Center [Member] | |||||||||||||
Real Estate [Line Items] | |||||||||||||
Term of Lease Signed (in years) | yr | 99 | ||||||||||||
Number of apartment units | apartments | 402 | ||||||||||||
Capital Lease Obligations | $ 28,962,000 | ||||||||||||
103 Carnegie Center [Member] | 103 Carnegie Center [Member] | |||||||||||||
Real Estate [Line Items] | |||||||||||||
Revenues | $ 400,000 | ||||||||||||
Earnings | $ 200,000 | ||||||||||||
Net Rentable Area (in sf) | ft² | 96,000 | ||||||||||||
Aggregate purchase price | $ 15,800,000 | ||||||||||||
Boston Properties Limited Partnership | |||||||||||||
Real Estate [Line Items] | |||||||||||||
Revenues | 656,907,000 | 623,546,000 | 1,289,135,000 | 1,289,531,000 | |||||||||
Earnings | 240,775,000 | 220,108,000 | 449,147,000 | 472,448,000 | |||||||||
Proceeds from sales of real estate | 17,049,000 | 104,816,000 | |||||||||||
Gains on sales of real estate | $ 4,344,000 | 0 | $ 4,477,000 | 69,792,000 | |||||||||
30 Shattuck Road [Member] | |||||||||||||
Real Estate [Line Items] | |||||||||||||
Area of Land | a | 9.5 | ||||||||||||
Contractual Sales Price | $ 5,000,000 | ||||||||||||
Proceeds from sales of real estate | 5,000,000 | ||||||||||||
Gains on sales of real estate | $ 3,700,000 | ||||||||||||
40 Shattuck Road [Member] | |||||||||||||
Real Estate [Line Items] | |||||||||||||
Net Rentable Area (in sf) | ft² | 122,000 | 122,000 | 122,000 | ||||||||||
Contractual Sales Price | $ 12,000,000 | $ 12,000,000 | $ 12,000,000 | ||||||||||
Net income (loss) | $ 19,000 | $ (93,000) | $ (28,000) | $ 15,000 | |||||||||
Proceeds from sales of real estate | 11,900,000 | ||||||||||||
Gains on sales of real estate | 28,000 | ||||||||||||
40 Shattuck Road [Member] | Boston Properties Limited Partnership | |||||||||||||
Real Estate [Line Items] | |||||||||||||
Gains on sales of real estate | $ 600,000 |
Real Estate Future minimum payments for MacArthur Transit capital lease (Details) - MacArthur Transit Center [Member] $ in Thousands |
Jun. 29, 2017
USD ($)
|
---|---|
Capital Leased Assets [Line Items] | |
Period from June 29, 2017 through December 31, 2017 | $ 5 |
2018 | 10 |
2019 | 10 |
2020 | 10 |
2021 | 13 |
Thereafter | 38,778 |
Total expected minimum obligations | 38,826 |
Interest portion | (9,864) |
Present value of net expected minimum payments | $ 28,962 |
Real Estate Purchase price allocation (Details) - 103 Carnegie Center [Member] $ in Thousands |
May 15, 2017
USD ($)
|
---|---|
Business Acquisition [Line Items] | |
Land | $ 2,890 |
Building and improvements | 11,229 |
Tenant improvements | 871 |
In-place lease intangibles | 2,389 |
Below-market lease intangible | (1,426) |
Net assets acquired | $ 15,953 |
Real Estate Amortization of finite lived intangible assets (Details) - 103 Carnegie Center [Member] $ in Thousands |
May 15, 2017
USD ($)
|
---|---|
Business Acquisition [Line Items] | |
Land | $ 2,890 |
Building and improvements | 11,229 |
Tenant improvements | 871 |
In-place lease intangibles | 2,389 |
Below-market lease intangible | (1,426) |
Acquired In-Place Lease Intangibles | |
Business Acquisition [Line Items] | |
Period from May 15, 2017 through December 31, 2017 | 660 |
2018 | 590 |
2019 | 367 |
2020 | 243 |
2021 | 96 |
Acquired Below- Market Lease Intangibles | |
Business Acquisition [Line Items] | |
Period from May 15, 2017 through December 31, 2017 | (248) |
2018 | (363) |
2019 | (337) |
2020 | (308) |
2021 | $ (105) |
Investments in Unconsolidated Joint Ventures (Investments in Unconsolidated Joint Ventures) (Details) $ in Thousands |
6 Months Ended | ||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2017
USD ($)
ft²
Land_Parcels
Buildings
payments
|
Dec. 31, 2016
USD ($)
|
||||||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||||||
Carrying Value of investment | $ (452,608) | $ (450,821) | |||||||||||||||
Carrying value of the Company's investments in unconsolidated joint ventures | $ 819,368 | 775,198 | |||||||||||||||
Square 407 Limited Partnership [Member] | |||||||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||||||
Properties | Market Square North | ||||||||||||||||
Ownership Percentage | 50.00% | ||||||||||||||||
Carrying Value of investment | [1] | $ (7,490) | (8,134) | ||||||||||||||
The Metropolitan Square Associates LLC [Member] | |||||||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||||||
Properties | Metropolitan Square | ||||||||||||||||
Ownership Percentage | 20.00% | ||||||||||||||||
Carrying value of the Company's investments in unconsolidated joint ventures | [1] | $ 2,496 | 2,004 | ||||||||||||||
BP/CRF 901 New York Avenue LLC [Member] | |||||||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||||||
Properties | 901 New York Avenue | ||||||||||||||||
Ownership Percentage | [2] | 25.00% | |||||||||||||||
Carrying Value of investment | [1] | $ (9,719) | (10,564) | ||||||||||||||
WP Project Developer LLC [Member] | |||||||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||||||
Properties | Wisconsin Place Land and Infrastructure | ||||||||||||||||
Ownership Percentage | [3] | 33.30% | |||||||||||||||
Carrying value of the Company's investments in unconsolidated joint ventures | [1] | $ 40,704 | 41,605 | ||||||||||||||
Entity Owning Land And Infrastructure Of Project [Member] | |||||||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||||||
Ownership Percentage | 33.30% | ||||||||||||||||
Annapolis Junction NFM, LLC [Member] | |||||||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||||||
Properties | Annapolis Junction | ||||||||||||||||
Ownership Percentage | [4] | 50.00% | |||||||||||||||
Carrying value of the Company's investments in unconsolidated joint ventures | [1] | $ 19,392 | 20,539 | ||||||||||||||
Number of real estate properties | Buildings | 4 | ||||||||||||||||
Parcels of undeveloped land | Land_Parcels | 2 | ||||||||||||||||
540 Madison Venture LLC [Member] | |||||||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||||||
Properties | 540 Madison Avenue | ||||||||||||||||
Ownership Percentage | 60.00% | ||||||||||||||||
Carrying value of the Company's investments in unconsolidated joint ventures | [1] | $ 68,325 | 67,816 | ||||||||||||||
500 North Capitol Venture LLC [Member] | |||||||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||||||
Properties | 500 North Capitol Street, NW | ||||||||||||||||
Ownership Percentage | 30.00% | ||||||||||||||||
Carrying Value of investment | [1] | $ (3,396) | (3,389) | ||||||||||||||
501 K Street LLC [Member] | |||||||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||||||
Properties | 1001 6th Street | ||||||||||||||||
Ownership Percentage | [5] | 50.00% | |||||||||||||||
Carrying value of the Company's investments in unconsolidated joint ventures | [1] | $ 42,428 | 42,528 | ||||||||||||||
Potential additonal payments to joint venture partner | payments | 2 | ||||||||||||||||
Minimum square footage to make a potential additional payment to joint venture partner (in sqft) | ft² | 520,000 | ||||||||||||||||
Podium Developer LLC [Member] | |||||||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||||||
Properties | The Hub on Causeway | ||||||||||||||||
Ownership Percentage | 50.00% | ||||||||||||||||
Carrying value of the Company's investments in unconsolidated joint ventures | [1] | $ 45,616 | 29,869 | ||||||||||||||
Residential Tower Developer LLC [Member] | |||||||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||||||
Properties | The Hub on Causeway - Residential | ||||||||||||||||
Ownership Percentage | 50.00% | ||||||||||||||||
Carrying value of the Company's investments in unconsolidated joint ventures | [1] | $ 23,799 | 20,803 | ||||||||||||||
Hotel Tower Developer LLC [Member] | |||||||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||||||
Properties | The Hub on Causeway - Hotel | ||||||||||||||||
Ownership Percentage | 50.00% | ||||||||||||||||
Carrying value of the Company's investments in unconsolidated joint ventures | [1] | $ 1,561 | 933 | ||||||||||||||
1265 Main Office JV LLC [Member] | |||||||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||||||
Properties | 1265 Main Street | ||||||||||||||||
Ownership Percentage | 50.00% | ||||||||||||||||
Carrying value of the Company's investments in unconsolidated joint ventures | [1] | $ 4,654 | 4,779 | ||||||||||||||
BNY Tower Holdings LLC [Member] | |||||||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||||||
Properties | Dock 72 at the Brooklyn Navy Yard | ||||||||||||||||
Ownership Percentage | [6] | 50.00% | |||||||||||||||
Carrying value of the Company's investments in unconsolidated joint ventures | [1] | $ 55,646 | 33,699 | ||||||||||||||
CA-Colorado Center Limited Partnership [Member] | |||||||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||||||
Properties | Colorado Center | ||||||||||||||||
Ownership Percentage | 49.80% | ||||||||||||||||
Carrying value of the Company's investments in unconsolidated joint ventures | [1] | $ 514,747 | 510,623 | ||||||||||||||
Unconsolidated Joint Ventures [Member] | |||||||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||||||
Carrying value of the Company's investments in unconsolidated joint ventures | (20,600) | (22,100) | |||||||||||||||
Unconsolidated Joint Ventures [Member] | |||||||||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||||||||
Carrying Value of investment | (81,047) | (67,167) | |||||||||||||||
Carrying value of the Company's investments in unconsolidated joint ventures | [1],[7] | $ 798,763 | $ 753,111 | ||||||||||||||
|
Investments in Unconsolidated Joint Ventures (Balance Sheets of the Unconsolidated Joint Ventures) (Details) - USD ($) $ in Thousands |
Jun. 30, 2017 |
Dec. 31, 2016 |
|||||||
---|---|---|---|---|---|---|---|---|---|
ASSETS | |||||||||
Real estate and development in process, net | $ 16,234,920 | $ 15,925,028 | |||||||
Liabilities and Members'/Partners' Equity [Abstract] | |||||||||
Mortgage notes payable, net | 2,986,283 | 2,063,087 | |||||||
Other Liabilities | 452,608 | 450,821 | |||||||
Total liabilities and equity / capital | 19,281,762 | 18,851,643 | |||||||
Carrying value of the Company's investments in unconsolidated joint ventures | 819,368 | 775,198 | |||||||
Unconsolidated Joint Ventures [Member] | |||||||||
ASSETS | |||||||||
Real estate and development in process, net | 1,599,268 | 1,519,217 | |||||||
Other assets | 315,170 | 297,263 | |||||||
Total assets | 1,914,438 | 1,816,480 | |||||||
Liabilities and Members'/Partners' Equity [Abstract] | |||||||||
Mortgage notes payable, net | 863,981 | 865,665 | |||||||
Other Liabilities | 81,047 | 67,167 | |||||||
Members'/Partners' equity | 969,410 | 883,648 | |||||||
Total liabilities and equity / capital | 1,914,438 | 1,816,480 | |||||||
Company's share of equity | 498,789 | 450,662 | |||||||
Basis differentials | [1] | 299,974 | 302,449 | ||||||
Carrying value of the Company's investments in unconsolidated joint ventures | [2],[3] | 798,763 | 753,111 | ||||||
Unconsolidated Joint Ventures [Member] | |||||||||
Liabilities and Members'/Partners' Equity [Abstract] | |||||||||
Carrying value of the Company's investments in unconsolidated joint ventures | (20,600) | (22,100) | |||||||
Colorado Center [Member] | |||||||||
Liabilities and Members'/Partners' Equity [Abstract] | |||||||||
Basis differentials | $ 325,900 | $ 328,800 | |||||||
|
Investments in Unconsolidated Joint Ventures (Statements of Operations of the Joint Ventures) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||||||||
---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
Jun. 30, 2017 |
Jun. 30, 2016 |
Dec. 31, 2016 |
||||||
Schedule of Equity Method Investments [Line Items] | ||||||||||
Total revenue | $ 656,907 | $ 623,546 | $ 1,289,135 | $ 1,289,531 | ||||||
Expenses | ||||||||||
Depreciation and amortization | 151,919 | 153,175 | 311,124 | 312,623 | ||||||
Total expenses | 418,217 | 405,422 | 844,220 | 821,054 | ||||||
Operating income | 238,690 | 218,124 | 444,915 | 468,477 | ||||||
Other expense | ||||||||||
Interest expense | 95,143 | 105,003 | 190,677 | 210,312 | ||||||
Losses on Extinguishment of Debt | (14,354) | 0 | (14,354) | 0 | ||||||
Net income | 167,010 | 117,357 | 282,574 | 333,579 | ||||||
Income from unconsolidated joint ventures | 3,108 | 2,234 | 6,192 | 4,025 | ||||||
Mortgage notes payable, net | 2,986,283 | 2,986,283 | $ 2,063,087 | |||||||
Unconsolidated Joint Ventures [Member] | ||||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||||
Total revenue | [1] | 55,862 | 38,368 | 110,623 | 76,037 | |||||
Expenses | ||||||||||
Operating | 22,103 | 16,359 | 44,182 | 33,026 | ||||||
Depreciation and amortization | 14,224 | 9,204 | 28,533 | 18,268 | ||||||
Total expenses | 36,327 | 25,563 | 72,715 | 51,294 | ||||||
Operating income | 19,535 | 12,805 | 37,908 | 24,743 | ||||||
Other expense | ||||||||||
Interest expense | 9,427 | 8,383 | 18,727 | 16,772 | ||||||
Net income | 10,108 | 4,422 | 19,181 | 7,971 | ||||||
Company's share of net income | 4,344 | 2,052 | 8,667 | 3,651 | ||||||
Basis differential | [2] | (1,236) | 182 | (2,475) | 374 | |||||
Income from unconsolidated joint ventures | 3,108 | 2,234 | 6,192 | 4,025 | ||||||
Straight-line rent adjustments | 4,300 | $ 3,600 | 11,300 | $ 5,800 | ||||||
Mortgage notes payable, net | 863,981 | 863,981 | $ 865,665 | |||||||
Colorado Center [Member] | Unconsolidated Joint Ventures [Member] | ||||||||||
Other expense | ||||||||||
Straight-line rent adjustments | 800 | 1,500 | ||||||||
"Above" and "below" market rent adjustments, net | $ 400 | $ 900 | ||||||||
|
Debt (Details) $ in Thousands |
3 Months Ended | 6 Months Ended | 12 Months Ended | |||||||
---|---|---|---|---|---|---|---|---|---|---|
Jun. 07, 2017
USD ($)
|
Apr. 24, 2017
USD ($)
mo
|
Jun. 30, 2017
USD ($)
|
Jun. 30, 2016
USD ($)
|
Jun. 30, 2017
USD ($)
yr
|
Jun. 30, 2016
USD ($)
|
Dec. 31, 2008
USD ($)
|
Jun. 06, 2017 |
Apr. 23, 2017
USD ($)
|
Dec. 31, 2016
USD ($)
|
|
Debt Instrument [Line Items] | ||||||||||
Proceeds from mortgage notes payable | $ 2,300,000 | $ 0 | ||||||||
Interest Payable | $ 85,172 | 85,172 | $ 243,933 | |||||||
Outside members’ notes payable | 0 | 0 | $ 180,000 | |||||||
Repayments of mortgage notes payable | 1,308,708 | 222,535 | ||||||||
Repayments of Mezzannine notes payable | 306,000 | 0 | ||||||||
Gains from early extinguishments of debt | $ 14,354 | $ 0 | $ 14,354 | $ 0 | ||||||
767 Fifth Avenue (the General Motors Building) | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Gains from early extinguishments of debt | $ 14,600 | |||||||||
767 Fifth Avenue (the General Motors Building) | Secured Debt [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Coupon/Stated Rate | 3.43% | |||||||||
767 Fifth Avenue (the General Motors Building) | Members' notes Payables [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Repayment of a portion of members loans accrued interest and principal balance | 176,100 | |||||||||
Consolidation, Eliminations [Member] | 767 Fifth Avenue (the General Motors Building) | Other Mezzanine Debt [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Repayments of Other Mezzanine Debt | $ 263,100 | |||||||||
Consolidated Entities [Member] | 767 Fifth Avenue (the General Motors Building) | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Unpaid principal balance of the members' notes payable contributed to equity | $ 273,900 | |||||||||
Consolidated Entities [Member] | 767 Fifth Avenue (the General Motors Building) | Secured Debt [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Ownership Percentage by the Company | 60.00% | |||||||||
Proceeds from mortgage notes payable | $ 2,300,000 | |||||||||
Debt Instrument, Term | 10 years | |||||||||
Coupon/Stated Rate | 3.43% | 5.95% | ||||||||
Repayments of mortgage notes payable | $ 1,300,000 | |||||||||
Consolidated Entities [Member] | 767 Fifth Avenue (the General Motors Building) | Mezzanine Debt [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Coupon/Stated Rate | 6.02% | |||||||||
Repayments of Mezzannine notes payable | $ 306,000 | |||||||||
Consolidated Entities [Member] | 767 Fifth Avenue (the General Motors Building) | Other Mezzanine Debt [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Other Long-term Debt | $ 294,000 | |||||||||
Coupon/Stated Rate | 6.02% | |||||||||
Consolidated Entities [Member] | 767 Fifth Avenue (the General Motors Building) | Members' notes Payables [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Coupon/Stated Rate | 11.00% | |||||||||
Interest Payable | $ 425,000 | |||||||||
Outside members’ notes payable | 450,000 | |||||||||
Consolidated Entities [Member] | Consolidation, Eliminations [Member] | 767 Fifth Avenue (the General Motors Building) | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Unpaid principal balance of the members' notes payable contributed to equity | 164,400 | |||||||||
Consolidated Entities [Member] | Consolidation, Eliminations [Member] | 767 Fifth Avenue (the General Motors Building) | Members' notes Payables [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Interest Payable | 255,000 | |||||||||
Outside members’ notes payable | 270,000 | |||||||||
Revolving Credit Facility [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Competitive bid quote | 65.00% | |||||||||
Maximum Leverage Ratio | 60.00% | |||||||||
Line of Credit Facility, Current Borrowing Capacity | $ 1,500,000 | $ 1,000,000 | ||||||||
Leverage Ratio Maximum Increasing Limit | 65.00% | |||||||||
Leverage Ratio Reduction Limit | 60.00% | |||||||||
Leverage Ratio Reduction Period, Years | yr | 1 | |||||||||
Maximum Secured Debt Leverage Ratio | 55.00% | |||||||||
Fixed Charge Coverage Ratio Minimum. | 1.40 | 1.40 | ||||||||
Maximum Unsecured Debt Leverage Ratio | 60.00% | |||||||||
Unsecured Debt Leverage Ratio Maximum Increasing Limit | 65.00% | |||||||||
Unsecured Debt Leverage Ratio Reduction Limit | 60.00% | |||||||||
Unsecured Debt Leverage Ratio Reduction Period, Years | yr | 1 | |||||||||
Unsecured Debt Interest Coverage Ratio Minimum. | 1.75 | |||||||||
Revolving Credit Facility [Member] | Minimum [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | 0.10% | |||||||||
Revolving Credit Facility [Member] | Maximum [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | 0.30% | |||||||||
Delayed Draw Facility [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | 0.15% | |||||||||
Line of Credit Facility, Frequency of Commitment Fee Payment | 4 | |||||||||
minimum borrowing amount | $ 50,000 | |||||||||
Line of Credit Facility, Current Borrowing Capacity | $ 500,000 | |||||||||
Alternative Base Interest Rate Calculation [Member] | Revolving Credit Facility [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Amount added to Federal Funds Rate to Calculate Interest Rate | 0.50% | |||||||||
LIBOR Period Used to Calculate Interest Rate (in months) | mo | 1 | |||||||||
Amount added to LIBOR to Calculate Interest Rate | 1.00% | |||||||||
Alternative Base Interest Rate Calculation [Member] | Revolving Credit Facility [Member] | Minimum [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Margin added to Calculated Interest Rate | 0.00% | |||||||||
Alternative Base Interest Rate Calculation [Member] | Revolving Credit Facility [Member] | Maximum [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Margin added to Calculated Interest Rate | 0.55% | |||||||||
Alternative Base Interest Rate Calculation [Member] | Delayed Draw Facility [Member] | Minimum [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Margin added to Calculated Interest Rate | 0.00% | |||||||||
Alternative Base Interest Rate Calculation [Member] | Delayed Draw Facility [Member] | Maximum [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Margin added to Calculated Interest Rate | 0.75% | |||||||||
Interest Rate Based on LIBOR or CDOR [Member] | Revolving Credit Facility [Member] | Minimum [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Margin added to Calculated Interest Rate | 0.775% | |||||||||
Interest Rate Based on LIBOR or CDOR [Member] | Revolving Credit Facility [Member] | Maximum [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Margin added to Calculated Interest Rate | 1.55% | |||||||||
Interest Rate Based on LIBOR or CDOR [Member] | Delayed Draw Facility [Member] | Minimum [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Margin added to Calculated Interest Rate | 0.85% | |||||||||
Interest Rate Based on LIBOR or CDOR [Member] | Delayed Draw Facility [Member] | Maximum [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Margin added to Calculated Interest Rate | 1.75% | |||||||||
Current credit rating [Member] | Revolving Credit Facility [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | 0.15% | |||||||||
Current credit rating [Member] | Alternative Base Interest Rate Calculation [Member] | Revolving Credit Facility [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Margin added to Calculated Interest Rate | 0.00% | 0.00% | ||||||||
Current credit rating [Member] | Alternative Base Interest Rate Calculation [Member] | Delayed Draw Facility [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Margin added to Calculated Interest Rate | 0.00% | 0.00% | ||||||||
Current credit rating [Member] | Interest Rate Based on LIBOR or CDOR [Member] | Revolving Credit Facility [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Margin added to Calculated Interest Rate | 0.875% | 0.875% | ||||||||
Current credit rating [Member] | Interest Rate Based on LIBOR or CDOR [Member] | Delayed Draw Facility [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Margin added to Calculated Interest Rate | 0.95% | 0.95% | ||||||||
Parent Company [Member] | Consolidated Entities [Member] | 767 Fifth Avenue (the General Motors Building) | Members' notes Payables [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Interest Payable | 170,000 | |||||||||
Outside members’ notes payable | $ 180,000 |
Derivative Instruments and Hedging Activities (Details) $ in Thousands |
6 Months Ended | 12 Months Ended | ||||
---|---|---|---|---|---|---|
Apr. 24, 2017
USD ($)
|
Aug. 17, 2016
USD ($)
yr
|
Jun. 30, 2017
USD ($)
|
Jun. 30, 2016
USD ($)
swaps
yr
|
Dec. 31, 2015
USD ($)
swaps
|
Dec. 31, 2016
USD ($)
|
|
Debt Instrument [Line Items] | ||||||
Mortgage notes payable, net | $ 2,986,283 | $ 2,063,087 | ||||
Cash payment to settle interest rate swap contracts | $ (33,093) | $ (71,805) | ||||
Boston Properties Limited Partnership | Interest Rate Swap [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Number of interest rate swap agreements entered into (swap contracts) | swaps | 17 | |||||
Term of anticipated mortgage loan (in years) | yr | 10 | |||||
Average Fixed Interest Rate | 2.423% | |||||
Notional Amount | $ 550,000 | |||||
Cash payment to settle interest rate swap contracts | $ 49,300 | |||||
Losses from interest rate contracts | 100 | |||||
Derivative Instruments, Loss Reclassified from Accumulated OCI into Income, Effective Portion | 49,200 | |||||
Derivative Instruments Loss Reclassified From Accumulated OCI Into Income Effective yearly amount | $ 4,900 | |||||
767 Fifth Partners LLC [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Ownership Percentage by the Company | 60.00% | |||||
767 Fifth Partners LLC [Member] | Interest Rate Swap [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Number of interest rate swap agreements entered into (swap contracts) | swaps | 16 | |||||
Maximum period of hedging exposure to the variability in future cash flows for forecasted transactions (in years) | yr | 10 | |||||
Average Fixed Interest Rate | 2.619% | |||||
Notional Amount | $ 450,000 | 450,000 | ||||
Cash payment to settle interest rate swap contracts | $ 14,400 | |||||
Derivative Instruments, Loss Reclassified from Accumulated OCI into Income, Effective Portion | 14,400 | |||||
Derivative Instruments Loss Reclassified From Accumulated OCI Into Income Effective yearly amount | 1,400 | |||||
Unsecured Debt [Member] | Boston Properties Limited Partnership | ||||||
Debt Instrument [Line Items] | ||||||
Coupon/Stated Rate | 2.75% | |||||
Boston Properties Limited Partnership | ||||||
Debt Instrument [Line Items] | ||||||
Mortgage notes payable, net | $ 2,986,283 | $ 2,063,087 | ||||
Cash payment to settle interest rate swap contracts | $ (33,093) | $ (71,805) | ||||
767 Fifth Avenue (the General Motors Building) | Secured Debt [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Mortgage notes payable, net | $ 2,300,000 | |||||
Coupon/Stated Rate | 3.43% |
Derivative Instruments and Hedging Activities Derivative Instrument and Hedging Activities Notional Table (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | 12 Months Ended | |||
---|---|---|---|---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
Jun. 30, 2017 |
Jun. 30, 2016 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Derivative [Line Items] | ||||||
Fair Value | $ (6,313) | $ (32,351) | $ (6,133) | $ (90,997) | ||
Boston Properties Limited Partnership | Interest Rate Swap [Member] | ||||||
Derivative [Line Items] | ||||||
Notional Amount | $ 550,000 | |||||
767 Fifth Partners LLC [Member] | Interest Rate Swap [Member] | ||||||
Derivative [Line Items] | ||||||
Derivative Liability, Notional Amount | $ 350,000 | |||||
Derivative Asset, Notional Amount | 100,000 | |||||
Notional Amount | $ 450,000 | $ 450,000 | 450,000 | |||
Fair Value | (8,264) | |||||
Liability [Member] | 767 Fifth Partners LLC [Member] | Interest Rate Swap [Member] | ||||||
Derivative [Line Items] | ||||||
Fair Value | $ (8,773) | |||||
Liability [Member] | Minimum [Member] | 767 Fifth Partners LLC [Member] | Interest Rate Swap [Member] | ||||||
Derivative [Line Items] | ||||||
Derivative, Fixed Interest Rate | 2.418% | |||||
Liability [Member] | Maximum [Member] | 767 Fifth Partners LLC [Member] | Interest Rate Swap [Member] | ||||||
Derivative [Line Items] | ||||||
Derivative, Fixed Interest Rate | 2.95% | |||||
Assets [Member] | 767 Fifth Partners LLC [Member] | Interest Rate Swap [Member] | ||||||
Derivative [Line Items] | ||||||
Fair Value | $ 509 | |||||
Assets [Member] | Minimum [Member] | 767 Fifth Partners LLC [Member] | Interest Rate Swap [Member] | ||||||
Derivative [Line Items] | ||||||
Derivative, Fixed Interest Rate | 2.336% | |||||
Assets [Member] | Maximum [Member] | 767 Fifth Partners LLC [Member] | Interest Rate Swap [Member] | ||||||
Derivative [Line Items] | ||||||
Derivative, Fixed Interest Rate | 2.388% |
Derivative Instruments and Hedging Activities Derivative Instruments and Hedging Activities Gain or Loss Recognized Related to Cash Flow hedges (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
Jun. 30, 2017 |
Jun. 30, 2016 |
|
Derivative [Line Items] | ||||
Amount of loss related to the effective portion recognized in other comprehensive loss | $ (6,313) | $ (32,351) | $ (6,133) | $ (90,997) |
Amount of loss related to the effective portion subsequently reclassified to earnings | (1,397) | (628) | (2,703) | (1,255) |
Amount of loss related to the ineffective portion and amount excluded from effectiveness testing | $ 0 | $ 0 | $ 0 | $ 0 |
Derivative Instruments and Hedging Activities Derivative Instruments and Hedging Activities Changes in Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | 12 Months Ended | |||||||
---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
Jun. 30, 2017 |
Jun. 30, 2016 |
Dec. 31, 2016 |
||||||
Accumulated Other Comprehensive Income or Loss [Roll Forward] | ||||||||||
Beginning Balance | $ (52,251) | $ (14,114) | $ (14,114) | |||||||
Effective portion of interest rate contracts | $ (6,313) | $ (32,351) | (6,133) | (90,997) | ||||||
Amortization of interest rate contracts | [1] | 1,397 | 628 | 2,703 | 1,255 | |||||
Other comprehensive loss attributable to noncontrolling interests | 2,738 | 8,681 | 2,520 | 24,108 | ||||||
Ending Balance | (53,161) | (79,748) | (53,161) | (79,748) | (52,251) | |||||
Boston Properties Limited Partnership | ||||||||||
Accumulated Other Comprehensive Income or Loss [Roll Forward] | ||||||||||
Beginning Balance | (60,853) | (18,337) | (18,337) | |||||||
Effective portion of interest rate contracts | (6,313) | (32,351) | (6,133) | (90,997) | ||||||
Amortization of interest rate contracts | [2] | 1,397 | 628 | 2,703 | 1,255 | |||||
Other comprehensive income (loss) attributable to noncontrolling interests | 2,416 | 16,547 | ||||||||
Ending Balance | $ (61,867) | $ (91,532) | $ (61,867) | $ (91,532) | $ (60,853) | |||||
|
Commitments And Contingencies (Details) - USD ($) $ in Millions |
2 Months Ended | 4 Months Ended | 6 Months Ended | 12 Months Ended | |||||
---|---|---|---|---|---|---|---|---|---|
Feb. 28, 2017 |
Jun. 30, 2017 |
Jun. 30, 2017 |
Dec. 31, 2009 |
May 19, 2017 |
Jul. 05, 2016 |
Dec. 31, 2015 |
Dec. 31, 2014 |
Jan. 10, 2014 |
|
Commitments And Contingencies [Line Items] | |||||||||
Letter of credit and performance obligations | $ 7.4 | $ 7.4 | |||||||
Property insurance program per occurrence limits | 1,000.0 | 1,000.0 | |||||||
Per occurrence limit for NBCR Coverage | 1,000.0 | ||||||||
Value of program trigger | 140.0 | $ 140.0 | |||||||
Coinsurance of program trigger | 17.00% | ||||||||
Deductible in insurance as a percentage of the value of the affected property, San Francisco and Los Angeles | 3.00% | ||||||||
Per occurrence limit of the earthquake insurance which covers San Francisco and Los Angeles regions | $ 170.0 | 240.0 | |||||||
Annual aggregate limit of the earthquake insurance which covers San Francisco and Los Angeles regions | 170.0 | 240.0 | |||||||
Amount of earthquake insurance provided by IXP, LLC as direct insurer San Francisco and Los Angeles | $ 20.0 | ||||||||
Earthquake Coverage Included In Builders Risk Policy For Salesforce Tower | $ 60.0 | ||||||||
767 Venture, LLC [Member] | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Maximum funding obligation | 263.8 | 263.8 | |||||||
Property insurance program per occurrence limits | 1,625.0 | 1,625.0 | |||||||
Lehman [Member] | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Bankruptcy claim, amount filed by general creditor | $ 45.3 | ||||||||
Bankruptcy claim amount allowed by court to creditor | $ 45.2 | ||||||||
Bankruptcy Claims, Amount of Claims Settled | $ 0.4 | $ 1.4 | $ 8.1 | $ 7.7 | |||||
Bankruptcy remaining claim amount allowed by court to creditor | 27.6 | 27.6 | |||||||
601 Lexington Avenue [Member] | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Coverage For Acts Of Terrorism Under TRIA Covered in Excess of Amount Covered by IXP | 250.0 | ||||||||
Boston Properties Limited Partnership | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Operating partnership guarantee to cover liabilities of IXP | $ 20.0 | $ 20.0 |
Noncontrolling Interests (Narrative) (Details) - Boston Properties Limited Partnership |
Jun. 30, 2017
shares
|
---|---|
Noncontrolling Interests [Member] | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |
Operating Partnership (OP) Units (in shares) | 16,823,685 |
Long-Term Incentive Plan (LTIP) Units (in shares) | 816,982 |
OPP Units 2012 [Member] | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |
Outperformance awards in LTIP Units (in shares) | 118,067 |
2013 MYLTIP [Member] | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |
2013 MYLTIP (in units) | 85,405 |
MYLTIP 2014 [Member] | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |
2014 MYLTIP (in units) | 25,107 |
2015 MYLTIP [Member] | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |
2015 MYLTIPS (in units) | 366,618 |
2016 MYLTIP [Member] | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |
2016 MYLTIPs (in units) | 473,360 |
2017 MYLTIP [Member] | |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |
2017 MYLTIP (in units) | 400,000 |
(Common Units) (Narrative) (Details) $ / shares in Units, $ in Millions |
6 Months Ended | |
---|---|---|
Feb. 03, 2017
USD ($)
shares
|
Jun. 30, 2017
USD ($)
yr
$ / shares
shares
|
|
OP Units [Member] | ||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||
OP Units for redemption (in shares) | 481,261 | |
Redemption of OP units issued on conversion of LTIP Units (in shares) | 22,110 | |
Restriction on redemption of OP Unit to Common Stock (in years) | yr | 1 | |
Redemption of OP Unit equivalent to Common Stock (in shares) | 1 | |
Common units of operating partnership if converted value | $ | $ 2,200.0 | |
Closing price of common stock (in dollars per share) | $ / shares | $ 123.02 | |
MYLTIP 2014 [Member] | ||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||
Final awards percentage of target | 27.70% | |
Value of MYLTIP Awards | $ | $ 3.5 | |
2014 MYLTIP Units Forfeited | 447,386 | |
Boston Properties Limited Partnership | OP Units [Member] | ||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||
MYLTIP distribution prior to measurement date | 10.00% | |
Boston Properties Limited Partnership | MYLTIP 2014 [Member] | ||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||
2014 MYLTIP (in units) | 25,107 | |
Boston Properties Limited Partnership | 2015 MYLTIP [Member] | ||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||
2015 MYLTIPS (in units) | 366,618 | |
Boston Properties Limited Partnership | 2016 MYLTIP [Member] | ||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||
2016 MYLTIPs (in units) | 473,360 | |
Boston Properties Limited Partnership | 2017 MYLTIP [Member] | ||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||
2017 MYLTIP (in units) | 400,000 |
Noncontrolling Interests Common units distributions (Details) - Boston Properties Limited Partnership - $ / shares |
Apr. 28, 2017 |
Jan. 30, 2017 |
Jun. 16, 2017 |
---|---|---|---|
Dividends Payable [Line Items] | |||
Distributions Declared To OP And LTIP Units Per Unit | $ 0.75 | ||
Distributions Declared To MYLTIP Units Per Unit (in dollars per unit) | $ 0.075 | ||
Distributions made to OP and LTIP units per unit (in dollars per unit) | $ 0.75 | $ 0.75 | |
Distribution paid to MYLTIP Units (in dollars per unit) | $ 0.075 | $ 0.075 |
Noncontrolling Interests Common units for Boston Properties Limited Partnership (Details) - USD ($) $ in Thousands |
6 Months Ended | |||
---|---|---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Noncontrolling Interest [Line Items] | ||||
Conversion of redeemable partnership units | $ 0 | |||
Cumulative effect of a change in accounting principle | $ (2,035) | |||
Accumulated other comprehensive loss | (53,161) | (79,748) | $ (52,251) | $ (14,114) |
Noncontrolling Interests [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Conversion of redeemable partnership units | 10,840 | 4,417 | ||
Cumulative effect of a change in accounting principle | (1,763) | |||
Boston Properties Limited Partnership | ||||
Noncontrolling Interest [Line Items] | ||||
Cumulative effect of a change in accounting principle | (272) | |||
Accumulated other comprehensive loss | (61,867) | (91,532) | $ (60,853) | $ (18,337) |
Boston Properties Limited Partnership | Noncontrolling Interests [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Beginning balance | 2,262,040 | 2,286,689 | ||
Contributions | 31,532 | 31,494 | ||
Net income | 26,933 | 32,771 | ||
Distributions | (26,977) | (23,713) | ||
Conversion of redeemable partnership units | (16,422) | (2,664) | ||
Unearned compensation | (12,344) | (16,617) | ||
Cumulative effect of a change in accounting principle | (1,763) | |||
Accumulated other comprehensive loss | (104) | (7,561) | ||
Adjustments to reflect redeemable preferred units at redemption value | (92,740) | 86,626 | ||
Ending balance | $ 2,170,155 | $ 2,387,025 |
Noncontrolling Interests (Property Partnerships) (Narrative) (Details) - USD ($) $ in Thousands |
May 12, 2016 |
Jun. 30, 2017 |
Jun. 06, 2017 |
Dec. 31, 2016 |
---|---|---|---|---|
Noncontrolling Interest [Line Items] | ||||
Noncontrolling Interest in Limited Partnerships | $ 1,653,981 | $ 1,530,647 | ||
Salesforce Tower[Member] | Consolidated Properties [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Portion of project costs covered by a construction loan | 50.00% | |||
Portion of costs funded (in percentage) | 50.00% | |||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 5.00% | |||
Debt Instrument, Basis Spread on Variable Rate | 3.00% | |||
Salesforce Tower[Member] | Parent Company [Member] | Consolidated Properties [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Costs funded (in percentage) | 2.50% | |||
Preferred equity funded | $ 13,500 | |||
767 Fifth Avenue (the General Motors Building) | Consolidated Properties [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Noncontrolling Interest in Limited Partnerships | $ 109,600 | |||
Ownership Percentage by the Company | 60.00% | |||
Unpaid principal balance of the members' notes payable contributed to equity | $ 273,900 | |||
767 Fifth Avenue (the General Motors Building) | Consolidation, Eliminations [Member] | Consolidated Properties [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Unpaid principal balance of the members' notes payable contributed to equity | $ 164,400 |
Noncontrolling Interests Property Partnerships (Details) - USD ($) |
3 Months Ended | 6 Months Ended | |||||
---|---|---|---|---|---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
Jun. 30, 2017 |
Jun. 30, 2016 |
||||
Activity of Noncontrolling Interests [Roll Forward] | |||||||
Beginning Balance | $ 1,530,647,000 | ||||||
Capital contributions | (133,072,000) | $ (5,040,000) | |||||
Net income | $ 15,203,000 | $ 6,814,000 | 19,627,000 | 17,278,000 | |||
Accumulated other comprehensive income (loss) | 2,738,000 | 8,681,000 | 2,520,000 | 24,108,000 | |||
Ending Balance | 1,653,981,000 | 1,653,981,000 | |||||
Property Partnerships Member | |||||||
Activity of Noncontrolling Interests [Roll Forward] | |||||||
Beginning Balance | 1,530,647,000 | 1,574,400,000 | |||||
Capital contributions | 133,072,000 | [1] | 3,720,000 | ||||
Net income | 19,627,000 | 17,278,000 | |||||
Accumulated other comprehensive income (loss) | (2,416,000) | (16,547,000) | |||||
Distributions | (26,949,000) | (25,914,000) | |||||
Ending Balance | 1,653,981,000 | $ 1,552,937,000 | 1,653,981,000 | $ 1,552,937,000 | |||
767 Fifth Avenue (the General Motors Building) | Property Partnerships Member | |||||||
Activity of Noncontrolling Interests [Roll Forward] | |||||||
Ending Balance | $ 109,576 | $ 109,576 | |||||
|
Stockholders' Equity / Partners' Capital Narrative (Details) |
6 Months Ended | ||||
---|---|---|---|---|---|
Jun. 02, 2017
USD ($)
yr
|
Jun. 30, 2017
USD ($)
$ / shares
shares
|
Mar. 27, 2018
$ / shares
|
Dec. 31, 2016
USD ($)
$ / shares
shares
|
Jun. 03, 2014
USD ($)
|
|
Class of Stock [Line Items] | |||||
Common stock, shares outstanding | 154,307,529 | 153,790,175 | |||
General Partners' Capital Account, Units Outstanding | 1,719,482 | ||||
Limited Partners' Capital Account, Units Outstanding | 152,588,047 | ||||
Shares of Common Stock in connection with the redemption of an equal number of OP Units (in shares) | 481,261 | ||||
Common Stock, Value, Issued | $ | $ 1,543,000 | $ 1,538,000 | |||
Atm Program [Member] | |||||
Class of Stock [Line Items] | |||||
At the market stock offering program, aggregate value of common stock | $ | $ 600,000,000 | $ 600,000,000 | |||
At Market Stock Offering Program Maximum Length Of Sale In Years | yr | 3 | ||||
Common Stock, Value, Issued | $ | $ 0 | ||||
Series B Cumulative Redeemable Preferred Stock [Member] | |||||
Class of Stock [Line Items] | |||||
Series B, Shares Outstanding (in shares) | 80,000 | 80,000 | |||
Series B, Dividend Rate, Percentage | 5.25% | ||||
Series B, Liquidation Preference Per Share (dollars per share) | $ / shares | $ 2,500.00 | $ 2,500 | |||
Ratio of depository shares to shares of Series B Preferred Stock | 0.01 | ||||
Depository shares of Series B Cumulative Redeemable Preferred [Member] | |||||
Class of Stock [Line Items] | |||||
Series B, Shares Outstanding (in shares) | 8,000,000 | ||||
Series B, Liquidation Preference Per Share (dollars per share) | $ / shares | $ 25.00 | ||||
Subsequent Event [Member] | Series B Cumulative Redeemable Preferred Stock [Member] | |||||
Class of Stock [Line Items] | |||||
Series B, Liquidation Preference Per Share (dollars per share) | $ / shares | $ 2,500.00 | ||||
Subsequent Event [Member] | Depository shares of Series B Cumulative Redeemable Preferred [Member] | |||||
Class of Stock [Line Items] | |||||
Series B, Liquidation Preference Per Share (dollars per share) | $ / shares | $ 25.00 | ||||
Boston Properties Limited Partnership | |||||
Class of Stock [Line Items] | |||||
General Partners' Capital Account, Units Outstanding | 1,719,482 | 1,717,743 | |||
Limited Partners' Capital Account, Units Outstanding | 152,588,047 | 152,072,432 | |||
Boston Properties Limited Partnership | Series B Cumulative Redeemable Preferred Stock [Member] | |||||
Class of Stock [Line Items] | |||||
Series B, Shares Outstanding (in shares) | 80,000 | 80,000 | |||
Series B, Liquidation Preference Per Share (dollars per share) | $ / shares | $ 2,500 | $ 2,500 |
Stockholders' Equity / Partners' Capital Stockholders' Equity / Partners' Capital Dividends / Distributions (Details) - $ / shares |
May 15, 2017 |
Apr. 28, 2017 |
Feb. 15, 2017 |
Jan. 30, 2017 |
Jun. 16, 2017 |
---|---|---|---|---|---|
Entity Information [Line Items] | |||||
Dividends Payable, Amount Per Share / Unit | $ 0.75 | ||||
Dividends, Per Share / Unit | $ 0.75 | $ 0.75 | |||
Boston Properties Limited Partnership | |||||
Entity Information [Line Items] | |||||
Dividends Payable, Amount Per Share / Unit | 0.75 | ||||
Dividends, Per Share / Unit | $ 0.75 | $ 0.75 | |||
Series B Cumulative Redeemable Preferred Stock [Member] | |||||
Entity Information [Line Items] | |||||
Dividends Payable, Amount Per Share / Unit | $ 32.8125 | ||||
Dividends, Per Share / Unit | $ 32.8125 | $ 32.8125 |
Earnings Per Share / Common Unit (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
Jun. 30, 2017 |
Jun. 30, 2016 |
|
Basic Earnings: | ||||
Net income attributable to the Company's common shareholders / unitholders | $ 133,709 | $ 96,597 | $ 230,764 | $ 278,323 |
Net income attributable to the Company's common shareholders / unitholders (in shares / units) | 154,177,000 | 153,662,000 | 154,019,000 | 153,644,000 |
Net income (in dollars per share / unit) | $ 0.87 | $ 0.63 | $ 1.50 | $ 1.81 |
Allocation of undistributed earnings to participating securities (numerator) | $ (43) | $ (9) | $ (241) | |
Allocation of undistributed earnings to participating securities (in shares) | 0 | 0 | 0 | |
Allocation of undistributed earnings to participating securities (in dollars per shares / units) | $ 0 | $ 0 | $ 0 | |
Net income attributable to the Company's common shareholders / unitholders | $ 133,666 | $ 230,755 | $ 278,082 | |
Net income attributable to the Company's common shareholders / unitholders (in shares / units) | 154,177,000 | 154,019,000 | 153,644,000 | |
Net income attributable to the Company's common shareholders / unitholders (in dollars per share / unit) | $ 0.87 | $ 1.50 | $ 1.81 | |
Effect of Dilutive Securities: | ||||
Stock Based Compensation, Income (Numerator) | $ 0 | $ 0 | $ 0 | $ 0 |
Stock Based Compensation, Shares / Units (Denominator) | 154,000 | 198,000 | 254,000 | 245,000 |
Stock Based Compensation, Per Share / Unit Amount (in dollars per share / unit) | $ 0.00 | $ 0.00 | $ 0.00 | $ 0.00 |
Diluted Earnings: | ||||
Net income attributable to the Company's common shareholders / unitholders (Numerator) | $ 133,666 | $ 96,597 | $ 230,755 | $ 278,082 |
Net income attributable to to the Company's shareholders / unitholder (number of shares) | 154,331,000 | 153,860,000 | 154,273,000 | 153,889,000 |
Diluted Earnings: Net income, Per Share Amount (in dollars per share / unit) | $ 0.87 | $ 0.63 | $ 1.50 | $ 1.81 |
Boston Properties Limited Partnership | ||||
Entity Information [Line Items] | ||||
Redeemable Common Units | 17,498,000 | 17,708,000 | 17,609,000 | 17,695,000 |
Basic Earnings: | ||||
Net income attributable to the Company's common shareholders / unitholders | $ 151,844 | $ 109,938 | $ 262,506 | $ 317,234 |
Net income attributable to the Company's common shareholders / unitholders (in shares / units) | 171,675,000 | 171,370,000 | 171,628,000 | 171,339,000 |
Net income (in dollars per share / unit) | $ 0.88 | $ 0.64 | $ 1.53 | $ 1.85 |
Allocation of undistributed earnings to participating securities (numerator) | $ (48) | $ (10) | $ (269) | |
Allocation of undistributed earnings to participating securities (in shares) | 0 | 0 | 0 | |
Allocation of undistributed earnings to participating securities (in dollars per shares / units) | $ 0 | $ 0 | $ 0.00 | |
Net income attributable to the Company's common shareholders / unitholders | $ 151,796 | $ 262,496 | $ 316,965 | |
Net income attributable to the Company's common shareholders / unitholders (in shares / units) | 171,675,000 | 171,628,000 | 171,339,000 | |
Net income attributable to the Company's common shareholders / unitholders (in dollars per share / unit) | $ 0.88 | $ 1.53 | $ 1.85 | |
Effect of Dilutive Securities: | ||||
Stock Based Compensation, Income (Numerator) | $ 0 | $ 0 | $ 0 | $ 0 |
Stock Based Compensation, Shares / Units (Denominator) | 154,000 | 198,000 | 254,000 | 245,000 |
Stock Based Compensation, Per Share / Unit Amount (in dollars per share / unit) | $ 0.00 | $ 0.00 | $ 0.00 | $ 0.00 |
Diluted Earnings: | ||||
Net income attributable to the Company's common shareholders / unitholders (Numerator) | $ 151,796 | $ 109,938 | $ 262,496 | $ 316,965 |
Net income attributable to to the Company's shareholders / unitholder (number of shares) | 171,829,000 | 171,568,000 | 171,882,000 | 171,584,000 |
Diluted Earnings: Net income, Per Share Amount (in dollars per share / unit) | $ 0.88 | $ 0.64 | $ 1.53 | $ 1.85 |
Stock Option and Incentive Plan Stock Option and Incentive Plan (Narrative) (Details) |
Feb. 03, 2017
USD ($)
shares
|
Jan. 25, 2017
USD ($)
yr
indices
tiers
|
---|---|---|
2017 MYLTIP [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
TSR Measurement, Years | yr | 3 | |
Indices Used to Compare TSR | indices | 2 | |
Number of Tiers | tiers | 4 | |
Threshold Tier | $ 10,700,000 | |
Target Tier | 21,300,000 | |
High Tier | 32,000,000 | |
Exceptional Tier | $ 42,700,000 | |
Percentage of annualized TSR for Reduction of Earned Awards | 0.00% | |
Percentage to Cause Some Awards to be Earned Even if on a Relative Basis it Would Not Result in any Earned Awards | 12.00% | |
Distributions Percent Before Measurement Date | 10.00% | |
Value of MYLTIP Awards | $ 17,700,000 | |
MYLTIP Value Amortized Into Earnings, Years | yr | 4 | |
MYLTIP 2014 [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Value of MYLTIP Awards | $ 3,500,000 | |
Final awards percentage of target | 27.70% | |
2014 MYLTIP Units Forfeited | shares | 447,386 | |
Cohen & Steers Realty Majors Portfolio Index [Member] | 2017 MYLTIP [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted Percentage of Index Used to Compare to TSR | 50.00% | |
NAREIT Office Index adjusted [Member] | 2017 MYLTIP [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted Percentage of Index Used to Compare to TSR | 50.00% | |
Minimum [Member] | 2017 MYLTIP [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Potential Awards Earned | $ 0 | |
Maximum [Member] | 2017 MYLTIP [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Potential Awards Earned | $ 42,700,000 | |
MYLTIP vesting 2020 [Member] | 2017 MYLTIP [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting Percentage | 50.00% | |
MYLTIP vesting 2021 [Member] | 2017 MYLTIP [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting Percentage | 50.00% |
Stock Option and Incentive Plan (Restricted Stock) (Narrative) (Details) $ / shares in Units, $ in Thousands |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2017
USD ($)
$ / shares
shares
|
Jun. 30, 2016
USD ($)
|
Jun. 30, 2017
USD ($)
VestingInstallments
$ / shares
shares
|
Jun. 30, 2016
USD ($)
|
Dec. 31, 2016
USD ($)
shares
|
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Shares issued | shares | 154,386,429 | 154,386,429 | 153,869,075 | ||
Common Stock, Value, Issued | $ 1,543 | $ 1,543 | $ 1,538 | ||
Stock based Compensation Expense | $ 7,900 | $ 7,100 | $ 18,100 | $ 16,500 | |
Restricted Stock [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Shares issued | shares | 37,414 | 37,414 | |||
Employee and director payment per share (in dollars per share) | $ / shares | $ 0.01 | ||||
Common Stock, Value, Issued | $ 4,900 | $ 4,900 | |||
Employee's weighted average cost per share (in dollars per share) | $ / shares | $ 130.32 | $ 130.32 | |||
LTIPs (including 2012 OPP and 2013 and 2014 MYLTIPS) And Restricted Stock [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting annual installments | VestingInstallments | 4 | ||||
Unrecognized compensation expenses | $ 26,800 | $ 26,800 | |||
Unvested MYLTIP Units [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Unrecognized compensation expenses | $ 28,500 | $ 28,500 | |||
Weighted-average period (years) | 2 years 8 months 12 days | ||||
Boston Properties Limited Partnership | LTIP Units [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
LTIP units issued (in shares) | shares | 111,488 | 111,488 | |||
Value of LTIP units issued | $ 13,300 | ||||
Per unit fair value weighted-average (in dollars per share) | $ / shares | $ 119.52 | $ 119.52 | |||
Expected life assumed to calculate per unit fair value per LTIP unit (years) | 5 years 8 months 12 days | ||||
Risk-free rate | 2.14% | ||||
Expected price volatility | 28.00% | ||||
Boston Properties Limited Partnership | 2017 MYLTIP [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
MYLTIP units issued (in shares) | shares | 400,000 | 400,000 | |||
Boston Properties Limited Partnership | LTIPs and 2017 MYLTIP Units [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Employee and director payment per share (in dollars per share) | $ / shares | $ 0.25 |
Segment Information (Schedule Of Reconciliation Of Net Operating Income To Net Income) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
Jun. 30, 2017 |
Jun. 30, 2016 |
|
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||||
Net income attributable to the Company's common shareholders / unitholders | $ 133,709 | $ 96,597 | $ 230,764 | $ 278,323 |
Preferred Stock Dividends / Distributions | (2,625) | (2,589) | (5,250) | (5,207) |
Noncontrolling interest-common units of the Operating Partnership | (15,473) | (11,357) | (26,933) | (32,771) |
Noncontrolling interest in property partnerships | (15,203) | (6,814) | (19,627) | (17,278) |
Interest expense | (95,143) | (105,003) | (190,677) | (210,312) |
Depreciation and amortization expense | (151,919) | (153,175) | (311,124) | (312,623) |
Transaction costs | (299) | (913) | (333) | (938) |
General and administrative expense | (27,141) | (25,418) | (58,527) | (54,771) |
Gains from early extinguishments of debt | (14,354) | 0 | (14,354) | 0 |
Gains from investments in securities | (730) | (478) | (1,772) | (737) |
Interest and other income | (1,504) | (1,524) | (2,118) | (3,029) |
Income from unconsolidated joint ventures | (3,108) | (2,234) | (6,192) | (4,025) |
Development and management services income | (7,365) | (5,533) | (13,837) | (12,222) |
Business Intersegment, Eliminations [Member] | ||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||||
Net income attributable to the Company's common shareholders / unitholders | 133,709 | 96,597 | 230,764 | 278,323 |
Preferred Stock Dividends / Distributions | 2,625 | 2,589 | 5,250 | 5,207 |
Noncontrolling interest-common units of the Operating Partnership | 15,473 | 11,357 | 26,933 | 32,771 |
Noncontrolling interest in property partnerships | 15,203 | 6,814 | 19,627 | 17,278 |
Interest expense | 95,143 | 105,003 | 190,677 | 210,312 |
Depreciation and amortization expense | 151,919 | 153,175 | 311,124 | 312,623 |
Transaction costs | 299 | 913 | 333 | 938 |
General and administrative expense | 27,141 | 25,418 | 58,527 | 54,771 |
Gains on sales of real estate | 3,767 | 0 | 3,900 | 67,623 |
Gains from early extinguishments of debt | 14,354 | 0 | 14,354 | 0 |
Gains from investments in securities | 730 | 478 | 1,772 | 737 |
Interest and other income | 1,504 | 1,524 | 2,118 | 3,029 |
Income from unconsolidated joint ventures | 3,108 | 2,234 | 6,192 | 4,025 |
Development and management services income | 7,365 | 5,533 | 13,837 | 12,222 |
Net Operating Income | 410,684 | 392,097 | 801,062 | 824,587 |
Boston Properties Limited Partnership | ||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||||
Net income attributable to the Company's common shareholders / unitholders | 151,844 | 109,938 | 262,506 | 317,234 |
Preferred Stock Dividends / Distributions | (2,625) | (2,589) | (5,250) | (5,207) |
Noncontrolling interest in property partnerships | (15,203) | (6,814) | (19,627) | (17,278) |
Interest expense | (95,143) | (105,003) | (190,677) | (210,312) |
Depreciation and amortization expense | (149,834) | (151,191) | (306,892) | (308,652) |
Transaction costs | (299) | (913) | (333) | (938) |
General and administrative expense | (27,141) | (25,418) | (58,527) | (54,771) |
Gains from early extinguishments of debt | (14,354) | 0 | (14,354) | 0 |
Gains from investments in securities | (730) | (478) | (1,772) | (737) |
Interest and other income | (1,504) | (1,524) | (2,118) | (3,029) |
Income from unconsolidated joint ventures | (3,108) | (2,234) | (6,192) | (4,025) |
Development and management services income | (7,365) | (5,533) | (13,837) | (12,222) |
Boston Properties Limited Partnership | Business Intersegment, Eliminations [Member] | ||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||||
Net income attributable to the Company's common shareholders / unitholders | 151,844 | 109,938 | 262,506 | 317,234 |
Preferred Stock Dividends / Distributions | 2,625 | 2,589 | 5,250 | 5,207 |
Noncontrolling interest in property partnerships | 15,203 | 6,814 | 19,627 | 17,278 |
Interest expense | 95,143 | 105,003 | 190,677 | 210,312 |
Depreciation and amortization expense | 149,834 | 151,191 | 306,892 | 308,652 |
Transaction costs | 299 | 913 | 333 | 938 |
General and administrative expense | 27,141 | 25,418 | 58,527 | 54,771 |
Gains on sales of real estate | 4,344 | 0 | 4,477 | 69,792 |
Gains from early extinguishments of debt | 14,354 | 0 | 14,354 | 0 |
Gains from investments in securities | 730 | 478 | 1,772 | 737 |
Interest and other income | 1,504 | 1,524 | 2,118 | 3,029 |
Income from unconsolidated joint ventures | 3,108 | 2,234 | 6,192 | 4,025 |
Development and management services income | 7,365 | 5,533 | 13,837 | 12,222 |
Net Operating Income | $ 410,684 | $ 392,097 | $ 801,062 | $ 824,587 |
Segment Information (Schedule Of Segment Reporting By Geographic Area And Property Type) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
Jun. 30, 2017 |
Jun. 30, 2016 |
|
Segment Reporting Information [Line Items] | ||||
Rental Revenue: Office | $ 631,957 | $ 601,117 | $ 1,246,337 | $ 1,247,607 |
Rental Revenue: Residential | 4,210 | 4,088 | 8,166 | 8,137 |
Rental Revenue: Hotel | 13,375 | 12,808 | 20,795 | 21,565 |
Total revenue | $ 649,542 | $ 618,013 | $ 1,275,298 | $ 1,277,309 |
Rental Revenue: % of Grand Totals | 100.00% | 100.00% | 100.00% | 100.00% |
Rental Expenses: Office | $ 228,819 | $ 216,332 | $ 455,555 | $ 433,904 |
Rental Expenses: Residential | 1,635 | 1,606 | 3,186 | 3,206 |
Rental Expenses: Hotel | 8,404 | 7,978 | 15,495 | 15,612 |
Rental Expenses: Total | $ 238,858 | $ 225,916 | $ 474,236 | $ 452,722 |
Rental Expenses: % Of Grand Totals | 100.00% | 100.00% | 100.00% | 100.00% |
Net operating Income | $ 410,684 | $ 392,097 | $ 801,062 | $ 824,587 |
Net operating Income: % of Grand Totals | 100.00% | 100.00% | 100.00% | 100.00% |
Boston [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Rental Revenue: Office | $ 191,760 | $ 179,048 | $ 377,196 | $ 356,875 |
Rental Revenue: Residential | 1,153 | 1,180 | 2,292 | 2,351 |
Rental Revenue: Hotel | 13,375 | 12,808 | 20,795 | 21,565 |
Total revenue | $ 206,288 | $ 193,036 | $ 400,283 | $ 380,791 |
Rental Revenue: % of Grand Totals | 31.76% | 31.24% | 31.39% | 29.81% |
Rental Expenses: Office | $ 74,160 | $ 68,754 | $ 149,416 | $ 139,441 |
Rental Expenses: Residential | 545 | 513 | 1,040 | 1,033 |
Rental Expenses: Hotel | 8,404 | 7,978 | 15,495 | 15,612 |
Rental Expenses: Total | $ 83,109 | $ 77,245 | $ 165,951 | $ 156,086 |
Rental Expenses: % Of Grand Totals | 34.79% | 34.19% | 34.99% | 34.47% |
Net operating Income | $ 123,179 | $ 115,791 | $ 234,332 | $ 224,705 |
Net operating Income: % of Grand Totals | 29.99% | 29.53% | 29.25% | 27.25% |
New York [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Rental Revenue: Office | $ 251,844 | $ 243,957 | $ 493,414 | $ 535,815 |
Rental Revenue: Residential | 0 | 0 | 0 | 0 |
Rental Revenue: Hotel | 0 | 0 | 0 | 0 |
Total revenue | $ 251,844 | $ 243,957 | $ 493,414 | $ 535,815 |
Rental Revenue: % of Grand Totals | 38.77% | 39.47% | 38.69% | 41.95% |
Rental Expenses: Office | $ 93,110 | $ 88,749 | $ 184,794 | $ 177,547 |
Rental Expenses: Residential | 0 | 0 | 0 | 0 |
Rental Expenses: Hotel | 0 | 0 | 0 | 0 |
Rental Expenses: Total | $ 93,110 | $ 88,749 | $ 184,794 | $ 177,547 |
Rental Expenses: % Of Grand Totals | 38.98% | 39.29% | 38.97% | 39.22% |
Net operating Income | $ 158,734 | $ 155,208 | $ 308,620 | $ 358,268 |
Net operating Income: % of Grand Totals | 38.65% | 39.59% | 38.53% | 43.45% |
San Francisco [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Rental Revenue: Office | $ 85,483 | $ 78,524 | $ 170,124 | $ 154,841 |
Rental Revenue: Residential | 0 | 0 | 0 | 0 |
Rental Revenue: Hotel | 0 | 0 | 0 | 0 |
Total revenue | $ 85,483 | $ 78,524 | $ 170,124 | $ 154,841 |
Rental Revenue: % of Grand Totals | 13.16% | 12.71% | 13.34% | 12.12% |
Rental Expenses: Office | $ 25,938 | $ 25,470 | $ 50,412 | $ 49,375 |
Rental Expenses: Residential | 0 | 0 | 0 | 0 |
Rental Expenses: Hotel | 0 | 0 | 0 | 0 |
Rental Expenses: Total | $ 25,938 | $ 25,470 | $ 50,412 | $ 49,375 |
Rental Expenses: % Of Grand Totals | 10.86% | 11.27% | 10.63% | 10.91% |
Net operating Income | $ 59,545 | $ 53,054 | $ 119,712 | $ 105,466 |
Net operating Income: % of Grand Totals | 14.50% | 13.53% | 14.94% | 12.79% |
Washington, DC [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Rental Revenue: Office | $ 102,870 | $ 99,588 | $ 205,603 | $ 200,076 |
Rental Revenue: Residential | 3,057 | 2,908 | 5,874 | 5,786 |
Rental Revenue: Hotel | 0 | 0 | 0 | 0 |
Total revenue | $ 105,927 | $ 102,496 | $ 211,477 | $ 205,862 |
Rental Revenue: % of Grand Totals | 16.31% | 16.58% | 16.58% | 16.12% |
Rental Expenses: Office | $ 35,611 | $ 33,359 | $ 70,933 | $ 67,541 |
Rental Expenses: Residential | 1,090 | 1,093 | 2,146 | 2,173 |
Rental Expenses: Hotel | 0 | 0 | 0 | 0 |
Rental Expenses: Total | $ 36,701 | $ 34,452 | $ 73,079 | $ 69,714 |
Rental Expenses: % Of Grand Totals | 15.37% | 15.25% | 15.41% | 15.40% |
Net operating Income | $ 69,226 | $ 68,044 | $ 138,398 | $ 136,148 |
Net operating Income: % of Grand Totals | 16.86% | 17.35% | 17.28% | 16.51% |
Subsequent Events subsequent Events (Details) $ in Thousands |
6 Months Ended | |||
---|---|---|---|---|
Jul. 28, 2017
USD ($)
ft²
a
Buildings
Vehicles
|
Jun. 30, 2017
USD ($)
|
Jun. 30, 2016
USD ($)
|
Jul. 26, 2017
ft²
yr
|
|
Subsequent Event [Line Items] | ||||
Proceeds from mortgage notes payable | $ | $ 2,300,000 | $ 0 | ||
Colorado Center [Member] | Subsequent Event [Member] | ||||
Subsequent Event [Line Items] | ||||
Ownership Percentage | 50.00% | |||
number of buildings | Buildings | 6 | |||
Area of Land | a | 15 | |||
Net Rentable Area (in sf) | ft² | 1,184,000 | |||
Vehicles In Structured Parking | Vehicles | 3,100 | |||
7750 Wisconsin Avenue [Member] | Subsequent Event [Member] | ||||
Subsequent Event [Line Items] | ||||
Ownership Percentage | 50.00% | |||
Net Rentable Area (in sf) | ft² | 720,000 | |||
Term of Lease Signed (in years) | yr | 20 | |||
Secured Debt [Member] | Colorado Center [Member] | Subsequent Event [Member] | ||||
Subsequent Event [Line Items] | ||||
Debt Instrument, Term | 10 years | |||
Proceeds from mortgage notes payable | $ | $ 550,000 | |||
Coupon/Stated Rate | 3.56% | |||
Parent Company [Member] | 7750 Wisconsin Avenue [Member] | Subsequent Event [Member] | ||||
Subsequent Event [Line Items] | ||||
Ownership Percentage | 50.00% |
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