What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2022-08-05 compared with 2022-05-02 · 472 added, 196 removed, 889 unchanged (43% of the section changed)

3 unchanged sentences

(unaudited and in thousands, except for share and par value amounts)

March 31, 2022 December 31, 2021

Real estate, at cost (amounts related to variable interest entities (“VIEs”) of $ 6,717,227 and $ 6,702,830 at March 31, 2022 and December 31, 2021, respectively)

June 30, 2022 December 31, 2021

Real estate, at cost (amounts related to variable interest entities (“VIEs”) of $ 6,736,095 and $ 6,702,830 at June 30, 2022 and December 31, 2021, respectively)

$ 24,700,571 $ 23,752,630

Right of use assets - finance leases (amounts related to VIEs of $ 21,000 and $ 21,000 at March 31, 2022 and December 31, 2021, respectively)

Right of use assets - finance leases (amounts related to VIEs of $ 21,000 and $ 21,000 at June 30, 2022 and December 31, 2021, respectively)

237,488 237,507

1 unchanged sentence

168,370 169,778

accumulated depreciation (amounts related to VIEs of $( 1,306,601 ) and $( 1,283,060 ) at March 31, 2022 and December 31, 2021, respectively)

accumulated depreciation (amounts related to VIEs of $( 1,328,099 ) and $( 1,283,060 ) at June 30, 2022 and December 31, 2021, respectively)

( 6,077,270 ) ( 5,883,961 )

Total real estate 19,029,159 18,275,954

Cash and cash equivalents (amounts related to VIEs of $ 266,593 and $ 300,937 at March 31, 2022 and December 31, 2021, respectively)

Cash and cash equivalents (amounts related to VIEs of $ 297,608 and $ 300,937 at June 30, 2022 and December 31, 2021, respectively)

456,491 452,692

2 unchanged sentences

Investments in securities 31,457 43,632

Tenant and other receivables, net (amounts related to VIEs of $ 8,414 and $ 6,824 at March 31, 2022 and December 31, 2021, respectively)

Tenant and other receivables, net (amounts related to VIEs of $ 11,008 and $ 6,824 at June 30, 2022 and December 31, 2021, respectively)

64,607 70,186

1 unchanged sentence

Notes receivable, net

Accrued rental income, net (amounts related to VIEs of $ 356,640 and $ 357,395 at March 31, 2022 and December 31, 2021, respectively)

Accrued rental income, net (amounts related to VIEs of $ 357,000 and $ 357,395 at June 30, 2022 and December 31, 2021, respectively)

1,265,480 1,226,745

Deferred charges, net (amounts related to VIEs of $ 174,063 and $ 174,637 at March 31, 2022 and December 31, 2021, respectively)

Deferred charges, net (amounts related to VIEs of $ 178,001 and $ 174,637 at June 30, 2022 and December 31, 2021, respectively)

684,078 618,798

Prepaid expenses and other assets (amounts related to VIEs of $ 39,362 and $ 29,668 at March 31, 2022 and December 31, 2021, respectively)

Prepaid expenses and other assets (amounts related to VIEs of $ 8,866 and $ 29,668 at June 30, 2022 and December 31, 2021, respectively)

55,232 57,811

2 unchanged sentences

LIABILITIES AND EQUITY

Mortgage notes payable, net (amounts related to VIEs of $ 3,268,745 and $ 3,267,914 at March 31, 2022 and December 31, 2021, respectively)

Mortgage notes payable, net (amounts related to VIEs of $ 3,269,948 and $ 3,267,914 at June 30, 2022 and December 31, 2021, respectively)

$ 3,269,948 $ 3,267,914

1 unchanged sentence

Unsecured line of credit 165,000 145,000

Lease liabilities - finance leases (amounts related to VIEs of $ 20,420 and $ 20,458 at March 31, 2022 and December 31, 2021, respectively)

Unsecured term loan, net 728,795 —

Lease liabilities - finance leases (amounts related to VIEs of $ 20,532 and $ 20,458 at June 30, 2022 and December 31, 2021, respectively)

246,832 244,421

Lease liabilities - operating leases 204,643 204,561

Accounts payable and accrued expenses (amounts related to VIEs of $ 30,804 and $ 29,464 at March 31, 2022 and December 31, 2021, respectively)

Accounts payable and accrued expenses (amounts related to VIEs of $ 41,409 and $ 29,464 at June 30, 2022 and December 31, 2021, respectively)

342,467 320,775

2 unchanged sentences

96,821 94,796

Other liabilities (amounts related to VIEs of $ 128,581 and $ 150,131 at March 31, 2022 and December 31, 2021, respectively)

Other liabilities (amounts related to VIEs of $ 113,103 and $ 150,131 at June 30, 2022 and December 31, 2021, respectively)

401,360 391,441

Total liabilities 15,115,833 14,322,462

Commitments and contingencies (See Note 6)

Redeemable deferred stock units— 85,645 and 83,073 units outstanding at redemption value at March 31, 2022 and December 31, 2021, respectively

BOSTON PROPERTIES, INC.

1 unchanged sentence

(unaudited and in thousands, except for share and par value amounts)

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

Commitments and contingencies (See Note 7)

Redeemable deferred stock units— 89,132 and 83,073 units outstanding at redemption value at June 30, 2022 and December 31, 2021, respectively

Stockholders’ equity attributable to Boston Properties, Inc.:

1 unchanged sentence

Preferred stock, $ 0.01 par value, 50,000,000 shares authorized, none issued or outstanding

Common stock, $ 0.01 par value, 250,000,000 shares authorized, 156,790,614 and 156,623,749 issued and 156,711,714 and 156,544,849 outstanding at March 31, 2022 and December 31, 2021, respectively

Common stock, $ 0.01 par value, 250,000,000 shares authorized, 156,805,330 and 156,623,749 issued and 156,726,430 and 156,544,849 outstanding at June 30, 2022 and December 31, 2021, respectively

Additional paid-in capital

1 unchanged sentence

Dividends in excess of earnings ( 567,016 ) ( 625,891 )

Treasury common stock at cost, 78,900 shares at March 31, 2022 and December 31, 2021

Treasury common stock at cost, 78,900 shares at June 30, 2022 and December 31, 2021

( 2,722 ) ( 2,722 )

11 unchanged sentences

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

Three months ended March 31,

Three months ended June 30, Six months ended June 30,

2022 2021 2022 2021

Lease $ 721,899 $ 684,025 $ 1,440,019 $ 1,369,842

3 unchanged sentences

Direct reimbursements of payroll and related costs from management services contracts

3,239 2,655 7,304 6,160

Total revenue 773,927 713,807 1,528,234 1,427,502

7 unchanged sentences

Other income (expense)

Income from unconsolidated joint ventures 2,189 5,225

Income (loss) from unconsolidated joint ventures ( 54 ) ( 1,373 ) 2,135 3,852

Gains on sales of real estate 96,247 7,756 118,948 7,756

Interest and other income (loss) 1,195 1,452 2,423 2,620

Other income - assignment fee 6,624 — 6,624 —

Gains (losses) from investments in securities ( 4,716 ) 2,275 ( 6,978 ) 3,934

24 unchanged sentences

(unaudited and in thousands)

Three months ended March 31,

Three months ended June 30, Six months ended June 30,

2022 2021 2022 2021

Net income $ 267,243 $ 141,250 $ 444,200 $ 269,397

14 unchanged sentences

(unaudited and in thousands)

Common Stock Additional Paid-in Capital Dividends in Excess of Earnings Treasury Stock,

at cost Accumulated Other Comprehensive Loss Noncontrolling Interests - Common Units Noncontrolling Interests - Property Partnerships Total

Shares Amount

Equity, March 31, 2022 156,712 $ 1,567 $ 6,509,663 $ ( 636,421 ) $ ( 2,722 ) $ ( 28,485 ) $ 649,602 $ 1,548,455 $ 8,041,659

Redemption of operating partnership units to common stock 11 — 401 — — — ( 401 ) — —

Allocated net income for the period — — — 222,997 — — 25,700 18,546 267,243

Dividends/distributions declared — — — ( 153,592 ) — — ( 17,939 ) — ( 171,531 )

Net activity from stock option and incentive plan 3 — 4,420 — — — 13,605 — 18,025

Distributions to noncontrolling interests in property partnerships — — — — — — — ( 14,439 ) ( 14,439 )

Effective portion of interest rate contracts — — — — — 31 4 — 35

Amortization of interest rate contracts — — — — — 1,377 156 144 1,677

Reallocation of noncontrolling interest — — 10,513 — — — ( 10,513 ) — —

Equity, June 30, 2022

156,726 $ 1,567 $ 6,524,997 $ ( 567,016 ) $ ( 2,722 ) $ ( 27,077 ) $ 660,214 $ 1,552,706 $ 8,142,669

Equity, March 31, 2021 156,074 $ 1,561 $ 6,392,923 $ ( 570,982 ) $ ( 2,722 ) $ ( 45,139 ) $ 620,106 $ 1,725,600 $ 8,121,347

Redemption of operating partnership units to common stock 59 — 2,087 — — — ( 2,087 ) — —

Allocated net income for the period — — — 111,748 — — 12,338 17,164 141,250

Dividends/distributions declared — — — ( 153,013 ) — — ( 17,253 ) — ( 170,266 )

Net activity from stock option and incentive plan 3 — ( 294 ) — — — 13,191 — 12,897

Contributions from noncontrolling interests in property partnerships — — — — — — — 2,139 2,139

Distributions to noncontrolling interests in property partnerships — — — — — — — ( 19,704 ) ( 19,704 )

Effective portion of interest rate contracts — — — — — 593 61 — 654

Amortization of interest rate contracts — — — — — 1,380 152 144 1,676

Reallocation of noncontrolling interest — — 11,200 — — — ( 11,200 ) — —

Equity, June 30, 2021

156,136 $ 1,561 $ 6,405,916 $ ( 612,247 ) $ ( 2,722 ) $ ( 43,166 ) $ 615,308 $ 1,725,343 $ 8,089,993

BOSTON PROPERTIES, INC.

CONSOLIDATED STATEMENTS OF EQUITY

(unaudited and in thousands)

Common Stock Preferred Stock Additional Paid-in Capital Dividends in Excess of Earnings Treasury Stock,

12 unchanged sentences

Reallocation of noncontrolling interest — — — 16,953 — — — ( 16,953 ) — —

Equity, March 31, 2022

Equity, June 30, 2022

156,726 $ 1,567 $ — $ 6,524,997 $ ( 567,016 ) $ ( 2,722 ) $ ( 27,077 ) $ 660,214 $ 1,552,706 $ 8,142,669

12 unchanged sentences

Reallocation of noncontrolling interest — — — 16,272 — — — ( 16,272 ) — —

Equity, March 31, 2021

Equity, June 30, 2021

156,136 $ 1,561 $ — $ 6,405,916 $ ( 612,247 ) $ ( 2,722 ) $ ( 43,166 ) $ 615,308 $ 1,725,343 $ 8,089,993

3 unchanged sentences

(unaudited and in thousands)

Three months ended March 31,

Six months ended June 30,

Cash flows from operating activities:

11 unchanged sentences

Losses from early extinguishments of debt — 898

Other income - assignment fee ( 6,624 ) —

Gains on sales of real estate ( 118,948 ) ( 7,756 )

17 unchanged sentences

Proceeds from sales of real estate 157,345 —

Proceeds from assignment fee 6,624 —

Capital contributions to unconsolidated joint ventures ( 69,819 ) ( 20,032 )

1 unchanged sentence

Proceeds from sale of investment in unconsolidated joint venture — 17,789

Proceeds from notes receivable 10,000 —

Investments in securities, net 5,197 1,915

3 unchanged sentences

Proceeds from unsecured senior notes — 846,345

Redemption of unsecured senior notes — ( 843,710 )

BOSTON PROPERTIES, INC.

1 unchanged sentence

(unaudited and in thousands)

Three months ended March 31,

Redemption of unsecured senior notes — ( 843,710 )

Six months ended June 30,

Borrowings on unsecured line of credit 340,000 —

Repayments of unsecured line of credit ( 320,000 ) —

Repayment of unsecured term loan — ( 500,000 )

Borrowings on unsecured term loan 730,000 —

Redemption of preferred stock — ( 200,000 )

Payments on finance lease obligations — 618

Repayment of unsecured term loan — ( 500,000 )

Deferred financing costs ( 2,230 ) ( 13,642 )

Debt prepayment and extinguishment costs — ( 185 )

Net proceeds from equity transactions ( 332 ) 19,643

Net activity from equity transactions ( 366 ) 19,580

Dividends and distributions ( 341,951 ) ( 343,117 )

1 unchanged sentence

Distributions to noncontrolling interests in property partnerships ( 41,079 ) ( 37,929 )

Net cash used in financing activities ( 86,970 ) ( 679,936 )

Net decrease in cash and cash equivalents and cash held in escrows ( 18,815 ) ( 770,146 )

Net cash provided by (used in) financing activities 365,223 ( 1,078,914 )

Net increase (decrease) in cash and cash equivalents and cash held in escrows 1,692 ( 1,082,049 )

Cash and cash equivalents and cash held in escrows, beginning of period 501,158 1,719,329

13 unchanged sentences

Change in real estate included in accounts payable and accrued expenses $ 40,655 $ ( 22,822 )

Preferred stock redemption liability $ — $ 200,000

Deferred distributions from sale of investment in unconsolidated joint ventures $ — $ 5,808

Deferred proceeds from sale of investment in unconsolidated joint ventures $ — $ 200

Construction in progress, net deconsolidated $ ( 11,316 ) $ —

Investment in unconsolidated joint ventures recorded upon deconsolidation $ 11,316 $ —

Right-of-use assets obtained in exchange for lease liabilities $ — $ 26,887

Dividends and distributions declared but not paid $ 170,937 $ 169,718

5 unchanged sentences

(unaudited and in thousands, except for unit amounts)

March 31, 2022 December 31, 2021

Real estate, at cost (amounts related to variable interest entities (“VIEs”) of $ 6,717,227 and $ 6,702,830 at March 31, 2022 and December 31, 2021, respectively)

June 30, 2022 December 31, 2021

Real estate, at cost (amounts related to variable interest entities (“VIEs”) of $ 6,736,095 and $ 6,702,830 at June 30, 2022 and December 31, 2021, respectively)

$ 24,333,045 $ 23,379,243

Right of use assets - finance leases (amounts related to VIEs of $ 21,000 and $ 21,000 at March 31, 2022 and December 31, 2021, respectively)

Right of use assets - finance leases (amounts related to VIEs of $ 21,000 and $ 21,000 at June 30, 2022 and December 31, 2021, respectively)

237,488 237,507

Right of use assets - operating leases 168,370 169,778

accumulated depreciation (amounts related to VIEs of $( 1,306,601 ) and $( 1,283,060 ) at March 31, 2022 and December 31, 2021, respectively)

accumulated depreciation (amounts related to VIEs of $( 1,328,099 ) and $( 1,283,060 ) at June 30, 2022 and December 31, 2021, respectively)

( 5,963,676 ) ( 5,772,018 )

Total real estate 18,775,227 18,014,510

Cash and cash equivalents (amounts related to VIEs of $ 266,593 and $ 300,937 at March 31, 2022 and December 31, 2021, respectively)

Cash and cash equivalents (amounts related to VIEs of $ 297,608 and $ 300,937 at June 30, 2022 and December 31, 2021, respectively)

456,491 452,692

2 unchanged sentences

Investments in securities 31,457 43,632

Tenant and other receivables, net (amounts related to VIEs of $ 8,414 and $ 6,824 at March 31, 2022 and December 31, 2021, respectively)

Tenant and other receivables, net (amounts related to VIEs of $ 11,008 and $ 6,824 at June 30, 2022 and December 31, 2021, respectively)

64,607 70,186

1 unchanged sentence

Notes receivable, net — 9,641

Accrued rental income, net (amounts related to VIEs of $ 356,640 and $ 357,395 at March 31, 2022 and December 31, 2021, respectively)

Accrued rental income, net (amounts related to VIEs of $ 357,000 and $ 357,395 at June 30, 2022 and December 31, 2021, respectively)

1,265,480 1,226,745

Deferred charges, net (amounts related to VIEs of $ 174,063 and $ 174,637 at March 31, 2022 and December 31, 2021, respectively)

Deferred charges, net (amounts related to VIEs of $ 178,001 and $ 174,637 at June 30, 2022 and December 31, 2021, respectively)

684,078 618,798

Prepaid expenses and other assets (amounts related to VIEs of $ 39,362 and $ 29,668 at March 31, 2022 and December 31, 2021, respectively)

Prepaid expenses and other assets (amounts related to VIEs of $ 8,866 and $ 29,668 at June 30, 2022 and December 31, 2021, respectively)

55,232 57,811

2 unchanged sentences

LIABILITIES AND CAPITAL

Mortgage notes payable, net (amounts related to VIEs of $ 3,268,745 and $ 3,267,914 at March 31, 2022 and December 31, 2021, respectively)

Mortgage notes payable, net (amounts related to VIEs of $ 3,269,948 and $ 3,267,914 at June 30, 2022 and December 31, 2021, respectively)

$ 3,269,948 $ 3,267,914

1 unchanged sentence

Unsecured line of credit 165,000 145,000

Lease liabilities - finance leases (amounts related to VIEs of $ 20,420 and $ 20,458 at March 31, 2022 and December 31, 2021, respectively)

Unsecured term loan, net 728,795 —

Lease liabilities - finance leases (amounts related to VIEs of $ 20,532 and $ 20,458 at June 30, 2022 and December 31, 2021, respectively)

246,832 244,421

1 unchanged sentence

204,643 204,561

Accounts payable and accrued expenses (amounts related to VIEs of $ 30,804 and $ 29,464 at March 31, 2022 and December 31, 2021, respectively)

Accounts payable and accrued expenses (amounts related to VIEs of $ 41,409 and $ 29,464 at June 30, 2022 and December 31, 2021, respectively)

342,467 320,775

2 unchanged sentences

96,821 94,796

Other liabilities (amounts related to VIEs of $ 128,581 and $ 150,131 at March 31, 2022 and December 31, 2021, respectively)

Other liabilities (amounts related to VIEs of $ 113,103 and $ 150,131 at June 30, 2022 and December 31, 2021, respectively)

401,360 391,441

1 unchanged sentence

Commitments and contingencies (See Note 7)

Redeemable deferred stock units— 85,645 and 83,073 units outstanding at redemption value at March 31, 2022 and December 31, 2021, respectively

Noncontrolling interests:

Redeemable partnership units— 16,550,441 and 16,561,186 common units and 1,678,082 and 1,485,376 long term incentive units outstanding at redemption value at March 31, 2022 and December 31, 2021, respectively

2,347,834 2,078,603

Redeemable deferred stock units— 89,132 and 83,073 units outstanding at redemption value at June 30, 2022 and December 31, 2021, respectively

BOSTON PROPERTIES LIMITED PARTNERSHIP

1 unchanged sentence

(unaudited and in thousands, except for unit amounts)

March 31, 2022 December 31, 2021

Boston Properties Limited Partnership partners’ capital— 1,749,402 and 1,745,914 general partner units and 154,962,312 and 154,798,935 limited partner units outstanding at March 31, 2022 and December 31, 2021, respectively

June 30, 2022 December 31, 2021

Noncontrolling interests:

Redeemable partnership units— 16,539,178 and 16,561,186 common units and 1,685,357 and 1,485,376 long term incentive units outstanding at redemption value at June 30, 2022 and December 31, 2021, respectively

1,646,678 2,078,603

Boston Properties Limited Partnership partners’ capital— 1,749,510 and 1,745,914 general partner units and 154,976,920 and 154,798,935 limited partner units outstanding at June 30, 2022 and December 31, 2021, respectively

4,716,430 4,173,290

Accumulated other comprehensive loss ( 27,077 ) ( 36,662 )

7 unchanged sentences

(unaudited and in thousands, except for per unit amounts)

Three months ended March 31,

Three months ended June 30, Six months ended June 30,

2022 2021 2022 2021

Lease $ 721,899 $ 684,025 $ 1,440,019 $ 1,369,842

3 unchanged sentences

Direct reimbursements of payroll and related costs from management services contracts

3,239 2,655 7,304 6,160

Total revenue 773,927 713,807 1,528,234 1,427,502

7 unchanged sentences

Other income (expense)

Income from unconsolidated joint ventures 2,189 5,225

Income (loss) from unconsolidated joint ventures ( 54 ) ( 1,373 ) 2,135 3,852

Gains on sales of real estate 99,608 7,756 122,992 7,756

Interest and other income (loss) 1,195 1,452 2,423 2,620

Other income - assignment fee 6,624 — 6,624 —

Gains (losses) from investments in securities ( 4,716 ) 2,275 ( 6,978 ) 3,934

20 unchanged sentences

(unaudited and in thousands)

Three months ended March 31,

Three months ended June 30, Six months ended June 30,

2022 2021 2022 2021

Net income $ 272,334 $ 143,010 $ 451,712 $ 274,222

14 unchanged sentences

Units Capital

General Partner Limited Partner Partners’ Capital (General and Limited Partners) Accumulated

Comprehensive Loss Noncontrolling

Interests - Property Partnerships Total Capital Noncontrolling Interests - Redeemable Partnership Units

Equity, March 31, 2022 1,749 154,962 $ 3,914,832 $ ( 28,485 ) $ 1,548,455 $ 5,434,802 $ 2,347,834

Net activity from contributions and unearned compensation 1 4 4,418 — — 4,418 13,607

Allocated net income for the period — — 228,088 — 18,546 246,634 25,700

Distributions — — ( 153,592 ) — — ( 153,592 ) ( 17,939 )

Conversion of redeemable partnership units — 11 401 — — 401 ( 401 )

Adjustment to reflect redeemable partnership units at redemption value — — 722,283 — — 722,283 ( 722,283 )

Effective portion of interest rate contracts — — — 31 — 31 4

Amortization of interest rate contracts — — — 1,377 144 1,521 156

Distributions to noncontrolling interests in property partnerships — — — — ( 14,439 ) ( 14,439 ) —

Equity, June 30, 2022

1,750 154,977 $ 4,716,430 $ ( 27,077 ) $ 1,552,706 $ 6,242,059 $ 1,646,678

Equity, March 31, 2021 1,737 154,338 $ 4,392,624 $ ( 45,139 ) $ 1,725,600 $ 6,073,085 $ 1,780,044

Net activity from contributions and unearned compensation — 2 ( 294 ) — — ( 294 ) 13,191

Allocated net income for the period — — 113,508 — 17,164 130,672 12,338

Distributions — — ( 153,013 ) — — ( 153,013 ) ( 17,253 )

Conversion of redeemable partnership units — 59 2,087 — — 2,087 ( 2,087 )

Adjustment to reflect redeemable partnership units at redemption value — — ( 222,032 ) — — ( 222,032 ) 222,032

Effective portion of interest rate contracts — — — 593 — 593 61

Amortization of interest rate contracts — — — 1,380 144 1,524 152

Contributions from noncontrolling interests in property partnerships — — — — 2,139 2,139 —

Distributions to noncontrolling interests in property partnerships — — — — ( 19,704 ) ( 19,704 ) —

Equity, June 30, 2021

1,737 154,399 $ 4,132,880 $ ( 43,166 ) $ 1,725,343 $ 5,815,057 $ 2,008,478

BOSTON PROPERTIES LIMITED PARTNERSHIP

CONSOLIDATED STATEMENTS OF CAPITAL AND NONCONTROLLING INTERESTS

(unaudited and in thousands)

Units Capital

General Partner Limited Partner Partners’ Capital (General and Limited Partners) Preferred Units Accumulated

5 unchanged sentences

Distributions

— — ( 307,169 ) — — — ( 307,169 ) ( 35,859 )

Conversion of redeemable partnership units

3 149 5,429 — — — 5,429 ( 5,429 )

Adjustment to reflect redeemable partnership units at redemption value

— — 466,439 — — — 466,439 ( 466,439 )

Effective portion of interest rate contracts

— — — — 6,831 — 6,831 769

Amortization of interest rate contracts

— — — — 2,754 288 3,042 311

Contributions from noncontrolling interests in property partnerships

— — — — — 849 849 —

Distributions to noncontrolling interests in property partnerships

Equity, March 31, 2022

— — — — — ( 41,079 ) ( 41,079 ) —

Equity, June 30, 2022

1,750 154,977 $ 4,716,430 $ — $ ( 27,077 ) $ 1,552,706 $ 6,242,059 $ 1,646,678

Equity, December 31, 2020 1,731 153,988 $ 4,554,639 $ 193,623 $ ( 49,890 ) $ 1,726,933 $ 6,425,305 $ 1,643,024

10 unchanged sentences

Distributions to noncontrolling interests in property partnerships — — — — — ( 37,929 ) ( 37,929 ) —

Equity, March 31, 2021

Equity, June 30, 2021

1,737 154,399 $ 4,132,880 $ — $ ( 43,166 ) $ 1,725,343 $ 5,815,057 $ 2,008,478

3 unchanged sentences

(unaudited and in thousands)

Three months ended March 31,

Six months ended June 30,

Cash flows from operating activities:

11 unchanged sentences

Losses from early extinguishments of debt — 898

Other income - assignment fee ( 6,624 ) —

Gains on sales of real estate ( 122,992 ) ( 7,756 )

17 unchanged sentences

Proceeds from sales of real estate 157,345 —

Proceeds from assignment fee 6,624 —

Capital contributions to unconsolidated joint ventures ( 69,819 ) ( 20,032 )

1 unchanged sentence

Proceeds from sale of investment in unconsolidated joint venture — 17,789

Proceeds from notes receivable 10,000 —

Investments in securities, net 5,197 1,915

Net cash used in investing activities ( 980,170 ) ( 563,611 )

BOSTON PROPERTIES LIMITED PARTNERSHIP

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited and in thousands)

Six months ended June 30,

Cash flows from financing activities:

4 unchanged sentences

Repayments of unsecured line of credit ( 320,000 ) —

Borrowings on unsecured term loan 730,000 —

Repayment of unsecured term loan — ( 500,000 )

BOSTON PROPERTIES LIMITED PARTNERSHIP

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited and in thousands)

Three months ended March 31,

Redemption of preferred units — ( 200,000 )

Payments on finance lease obligations — 618

1 unchanged sentence

Debt prepayment and extinguishment costs — ( 185 )

Net proceeds from equity transactions ( 332 ) 19,643

Net activity from equity transactions ( 366 ) 19,580

Distributions ( 341,951 ) ( 343,117 )

1 unchanged sentence

Distributions to noncontrolling interests in property partnerships ( 41,079 ) ( 37,929 )

Net cash used in financing activities ( 86,970 ) ( 679,936 )

Net decrease in cash and cash equivalents and cash held in escrows ( 18,815 ) ( 770,146 )

Net cash provided by (used in) financing activities 365,223 ( 1,078,914 )

Net increase (decrease) in cash and cash equivalents and cash held in escrows 1,692 ( 1,082,049 )

Cash and cash equivalents and cash held in escrows, beginning of period 501,158 1,719,329

13 unchanged sentences

Change in real estate included in accounts payable and accrued expenses $ 40,655 $ ( 22,822 )

Preferred stock redemption liability $ — $ 200,000

Deferred distributions from sale of investment in unconsolidated joint venture $ — $ 5,808

Deferred proceeds from sale of investment in unconsolidated joint venture $ — $ 200

Right-of-use assets obtained in exchange for lease liabilities $ — $ 26,887

Construction in progress, net deconsolidated $ ( 11,316 ) $ —

Investment in unconsolidated joint ventures recorded upon deconsolidation $ 11,316 $ —

Distributions declared but not paid $ 170,937 $ 169,718

6 unchanged sentences

BXP is a fully integrated, self-administered and self-managed REIT.

BXP is the sole general partner of BPLP, its operating partnership, and at March 31, 2022 owned an approximate 89.6 % ( 89.7 % at December 31, 2021) general and limited partnership interest in BPLP.

BXP is the sole general partner of BPLP, its operating partnership, and at June 30, 2022 owned an approximate 89.6 % ( 89.7 % at December 31, 2021) general and limited partnership interest in BPLP.

Unless stated otherwise or the context requires, the “Company” refers to BXP and its subsidiaries, including BPLP and its consolidated subsidiaries.

7 unchanged sentences

Because the number of shares of Common Stock outstanding at all times equals the number of OP Units that BXP 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 time-based, restricted equity compensation and as a form of performance-based equity compensation for employees, and has previously granted LTIP Units in the form of (1) 2012 outperformance plan awards (“2012 OPP Units”) and (2) 2013 - 2022 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 Company uses LTIP Units as a form of time-based, restricted equity compensation and as a form of performance-based equity compensation for employees, and has previously granted LTIP Units in the form of (1) 2012 outperformance plan awards (“2012 OPP Units”) and (2) 2013 - 2022 multi-year, long-term incentive program awards (also referred to as “MYLTIP Units”), each of which, upon the satisfaction of certain performance-based and time-based vesting conditions, is convertible into one OP Unit.

The three-year measurement periods for the 2012 OPP Units and the 2013 - 2019 MYLTIP Units have ended and BXP’s total stockholder return (“TSR”) was sufficient for employees to earn and therefore become eligible to vest in a portion of the awards.

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LTIP Units (including the earned 2012 OPP Units and the earned 2013 - 2019 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 and 12).

At March 31, 2022, the Company owned or had joint venture interests in a portfolio of 201 commercial real estate properties (the “Properties”) aggregating approximately 53.1 million net rentable square feet of primarily Class A office properties, including 11 properties under construction/redevelopment totaling approximately 4.1 million net rentable square feet.

At March 31, 2022, the Properties consisted of:

At June 30, 2022, the Company owned or had joint venture interests in a portfolio of 193 commercial real estate properties (the “Properties”) aggregating approximately 53.7 million net rentable square feet of primarily Class A office properties, including 12 properties under construction/redevelopment totaling approximately 4.2 million net rentable square feet.

At June 30, 2022, the Properties consisted of:

• 173 office properties (including 11 properties under construction/redevelopment);

• 12 retail properties;

• six residential properties;

• seven residential properties (including one property under construction ) ;

The Company considers Class A office properties to be well-located buildings that are modern structures or have been modernized to compete with newer buildings and professionally managed and maintained.

As such, these properties attract high-quality tenants and command upper-tier rental rates.

As such, these properties attract high-quality clients and command upper-tier rental rates.

Basis of Presentation and Summary of Significant Accounting Policies

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(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 six of the seven entities that are VIEs.

The Company has determined that it is the primary beneficiary for six of the eight entities that are VIEs.

Consolidated Variable Interest Entities

As of March 31, 2022, BXP has identified six consolidated VIEs, including BPLP.

As of June 30, 2022, BXP has identified six consolidated VIEs, including BPLP.

Excluding BPLP, the VIEs consisted of the following five in-service properties:

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Variable Interest Entities Not Consolidated

The Company has determined that the Platform 16 Holdings LP joint venture is a VIE.

The Company does not consolidate this entity as 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.

The Company has determined that the Platform 16 Holdings LP and PR II/BXP Reston Gateway LLC joint ventures are VIEs.

The Company does not consolidate these entities as the Company does not have the power to direct the activities that, when taken together, most significantly impact the respective VIE’s performance and, therefore, the Company is not considered to be the primary beneficiary.

Fair Value of Financial Instruments

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Unsecured line of credit Level 3

Unsecured term loan Level 3

_______________

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The Company’s estimated fair values for these instruments as of the end of the applicable reporting period are not projections of, nor necessarily indicative of, estimated or actual fair values in future reporting periods.

The following table presents the aggregate carrying value of the Company’s related party note receivable, net, notes receivable, net, mortgage notes payable, net, unsecured senior notes, net and unsecured line of credit and the Company’s corresponding estimate of fair value as of March 31, 2022 and December 31, 2021 (in thousands):

March 31, 2022 December 31, 2021

The following table presents the aggregate carrying value of the Company’s related party note receivable, net, notes receivable, net, mortgage notes payable, net, unsecured senior notes, net, unsecured line of credit and unsecured term loan, net and the Company’s corresponding estimate of fair value as of June 30, 2022 and December 31, 2021 (in thousands):

June 30, 2022 December 31, 2021

Amount Estimated

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Unsecured line of credit 165,000 165,000 145,000 145,317

Unsecured term loan, net 728,795 730,000 — —

Total $ 13,652,773 $ 12,507,147 $ 12,896,609 $ 13,507,477

Real estate consisted of the following at March 31, 2022 and December 31, 2021 (in thousands):

March 31, 2022 December 31, 2021

Real estate consisted of the following at June 30, 2022 and December 31, 2021 (in thousands):

June 30, 2022 December 31, 2021

Land $ 5,177,647 $ 5,061,169

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(1) Includes pre-development costs.

Real estate consisted of the following at March 31, 2022 and December 31, 2021 (in thousands):

March 31, 2022 December 31, 2021

Real estate consisted of the following at June 30, 2022 and December 31, 2021 (in thousands):

June 30, 2022 December 31, 2021

Land $ 5,082,926 $ 4,964,986

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(1) Includes pre-development costs.

Pending Acquisition

On April 19, 2021, the Company entered into an agreement to acquire 11251 Roger Bacon Drive, in Reston, Virginia, for an aggregate purchase price of approximately $ 5.6 million.

11251 Roger Bacon Drive is an approximately 65,000 square foot office building situated on approximately 2.6 acres.

The property is 100 % leased to a single tenant with a lease that expires concurrently with the planned closing (See Note 12).

On May 17, 2022, the Company completed the acquisition of Madison Centre in Seattle, Washington for a net purchase price, including transaction costs, of approximately $ 724.3 million.

The acquisition was completed using the proceeds from BPLP’s $ 730.0 million unsecured term loan (See Note 6).

Madison Centre is an approximately 755,000 net rentable square foot, 37 -story, LEED-Platinum certified, Class A office property.

The following table summarizes the allocation of the purchase price, including transaction costs, of Madison Centre at the date of acquisition (in thousands):

Land $ 104,641

Building and improvements 505,766

Tenant improvements 58,570

In-place lease intangibles 74,598

Above-market lease intangibles 3,794

Below-market lease intangibles ( 23,114 )

Net assets acquired $ 724,255

The following table summarizes the estimated annual amortization of the acquired in-place lease intangibles and the acquired above- and below-market lease intangibles for Madison Centre from May 17, 2022 through the remainder of 2022 and each of the five succeeding fiscal years (in thousands):

Acquired In-Place Lease Intangibles Acquired Above-Market Lease Intangibles Acquired Below-Market Lease Intangibles

Period from May 17, 2022 through December 31, 2022 $ 7,266 $ 640 $ 2,011

2023 12,200 1,098 3,442

2024 10,842 254 3,411

2025 10,770 254 3,398

2026 10,306 254 3,210

2027 9,161 254 2,805

Madison Centre contributed approximately $ 6.5 million of revenue and approximately $ 0.6 million of net income to the Company for the period from May 17, 2022 through June 30, 2022.

On March 31, 2022, the Company completed the sale of 195 West Street located in Waltham, Massachusetts for a gross sale price of $ 37.7 million.

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195 West Street is an approximately 63,500 net rentable square foot Class A office property.

195 West Street contributed approximately $ 0.4 million of net income to the Company for the three months ended March 31, 2022 and contributed approximately $ 0.2 million of net loss to the Company for the three months ended March 31, 2021.

195 West Street contributed approximately $ 0.4 million of net income to the Company for the six months ended June 30, 2022 and contributed approximately $ 0.1 million and $ 0.3 million of net loss to the Company for the three and six months ended June 30, 2021, respectively.

On April 19, 2021, the Company entered into an agreement to acquire 11251 Roger Bacon Drive in Reston, Virginia for an aggregate purchase price of approximately $ 5.6 million.

On April 7, 2022, the Company executed an agreement to assign its right to acquire 11251 Roger Bacon Drive to a third party for an assignment fee of approximately $ 6.9 million.

Net cash proceeds totaled approximately $ 6.6 million and is reflected as Other income - assignment fee in the Company's Consolidated Statements of Operations.

11251 Roger Bacon Drive is an approximately 65,000 square foot office building situated on approximately 2.6 acres.

The property was 100 % leased.

On June 15, 2022, the Company completed the sale of its suburban Virginia 95 Office Park properties located in Springfield, Virginia for an aggregate gross sale price of $ 127.5 million.

Net cash proceeds totaled approximately $ 121.9 million, resulting in a gain on sale of real estate totaling approximately $ 96.2 million for BXP and approximately $ 99.5 million for BPLP.

Virginia 95 Office Park consists of eleven Class A office/flex properties aggregating approximately 733,000 net rentable square feet.

Virginia 95 Office Park contributed approximately $ 1.0 million and $ 2.3 million of net income to the Company for the period from April 1, 2022 through June 15, 2022 and the period from January 1, 2022 through June 15, 2022, respectively, and contributed approximately $ 1.9 million and $ 4.1 million of net income to the Company for the three and six months ended June 30, 2021, respectively.

On April 27, 2022, the Company entered into a 15-year lease agreement with AstraZeneca for approximately 570,000 net rentable square feet at the Company’s 290 Binney Street future development project.

290 Binney Street is part of the initial phase of a future life sciences development project located in the heart of Kendall Square in Cambridge, Massachusetts.

The full project will consist of two buildings aggregating approximately 1.1 million rentable square feet of life sciences space and an approximately 400,000 square foot residential building.

The lease and commencement of construction are subject to various conditions, some of which are not within the Company’s control.

There can be no assurance that the conditions will be satisfied or that the Company will commence the development on the terms and schedule currently contemplated or at all.

On April 29, 2022, the Company partially placed in-service 2100 Pennsylvania Avenue, a Class A office project with approximately 480,000 net rentable square feet located in Washington, DC.

On May 13, 2022, the Company commenced the development of Reston Next Office Phase II, a Class A office project located in Reston, Virginia.

When completed, the building will consist of approximately 90,000 net rentable square feet.

On June 29, 2022, the Company completed and fully placed in-service 325 Main Street, a Class A office project with approximately 414,000 net rentable square feet located in Cambridge, Massachusetts.

The Company must make estimates as to the collectability of its accrued rent and accounts receivable balances related to lease revenue.

When evaluating the collectability of tenants’ accrued rent and accounts receivable balances, management considers tenant creditworthiness, current economic trends, including the impact of COVID-19 on tenants’ businesses, and changes in tenants’ payment patterns, on a lease-by-lease basis.

There were no new write-offs related to accrued rent, net balances and accounts receivable, net balances for the three months ended March 31, 2022.

However, during the three months ended March 31, 2022, the Company determined it was probable of collecting substantially all of certain tenants’ accrued rent and account receivable balances and, therefore, ceased recognizing revenue from such tenants on a cash basis.

As a result of returning these tenants to accrual basis accounting, the Company reinstated approximately $ 1.0 million of accrued rent balances.

During the three months ended March 31, 2021, the Company wrote off approximately $ 0.4 million related to accrued rent, net balances and accounts receivable, net balances.

The write-offs were for tenants, primarily in the retail sector, that either terminated their leases or for which the Company determined their accrued rent and/or accounts receivable balances were no longer probable of collection.

When evaluating the collectability of clients’ accrued rent and accounts receivable balances, management considers client creditworthiness, current economic trends, including the impact of the COVID-19 pandemic on clients’ businesses, and changes in clients’ payment patterns, on a lease-by-lease basis.

There were no new write-offs related to accrued rent, net balances and accounts receivable, net balances for the three and six months ended June 30, 2022.

However, during the three and six months ended June 30, 2022, the Company determined it was probable of collecting substantially all of certain clients’ accrued rent and account receivable balances and, therefore, ceased recognizing revenue from such clients on a cash basis.

As a result of returning these clients to accrual basis accounting, the Company reinstated approximately $ 0.5 million and $ 1.5 million of accrued rent balances during the three and six months ended June 30, 2022, respectively.

three and six months ended June 30, 2021, the Company wrote off approximately $ 0.9 million and $ 1.3 million, respectively, related to accrued rent, net balances and accounts receivable, net balances.

The write-offs were for clients, primarily in the retail sector, that either terminated their leases or for which the Company determined their accrued rent and/or accounts receivable balances were no longer probable of collection.

For information related to write-offs of accrued rent, net balances and accounts receivable, net balances and reinstatements of accrued rent balances for the Company’s unconsolidated joint ventures, see Note 5.

The following table summarizes the components of lease revenue recognized during the three months ended March 31, 2022 and 2021 included within the Company's Consolidated Statements of Operations (in thousands):

Three months ended March 31,

The following table summarizes the components of lease revenue recognized during the three and six months ended June 30, 2022 and 2021 included within the Company's Consolidated Statements of Operations (in thousands):

Three months ended June 30, Six months ended June 30,

Lease Revenue 2022 2021 2022 2021

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Investments in Unconsolidated Joint Ventures

The investments in unconsolidated joint ventures consist of the following at March 31, 2022 and December 31, 2021:

The investments in unconsolidated joint ventures consist of the following at June 30, 2022 and December 31, 2021:

Carrying Value of Investment (1)

Entity Properties Nominal % Ownership March 31, 2022 December 31, 2021

Entity Properties Nominal % Ownership June 30, 2022 December 31, 2021

(in thousands)

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360 PAS Holdco LLC 360 Park Avenue South 42.21 % (8) 111,209 106,855

PR II/BXP Reston Gateway LLC Reston Next Residential 20.00 % (5)(9) 11,140 N/A

751 Gateway Holdings LLC 751 Gateway 49.00 % (6) 56,477 N/A

$ 1,490,133 $ 1,445,926

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(1) Investments with deficit balances aggregating approximately $ 63.1 million and $ 37.1 million at March 31, 2022 and December 31, 2021, respectively, are included within Other Liabilities in the Company’s Consolidated Balance Sheets.

(1) Investments with deficit balances aggregating approximately $ 64.9 million and $ 37.1 million at June 30, 2022 and December 31, 2021, respectively, are included 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.

At March 31, 2022 and December 31, 2021, the Company’s economic ownership was approximately 50 %.

At June 30, 2022 and December 31, 2021, the Company’s economic ownership was approximately 50 %.

(3) The Company’s wholly-owned subsidiary that owns Wisconsin Place Office also owns a 33.33 % interest in the joint venture entity that owns the land, parking garage and infrastructure of the project.

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(5) This entity is a VIE (See Note 2).

(6) The Company’s ownership includes (1) a 33.0 % direct interest in the joint venture, and (2) an additional 1 % interest in each of the two entities (each, a “Safeco Partner Entity”) through which each partner owns its interest in the joint venture.

(7) The Company’s ownership includes (1) a 35.79 % direct interest in the joint venture, (2) an additional 5.837 % indirect ownership in the joint venture, and (3) an additional 1 % interest in each of the two entities (each, a “360 Park Avenue South Partner Entity”) through which each partner owns its interest in the joint venture.

(6) On June 16, 2022, 751 Gateway was segregated from Gateway Commons into a single-purpose joint venture.

(7) The Company’s ownership includes (1) a 33.0 % direct interest in the joint venture, and (2) an additional 1 % interest in each of the two entities through which each partner owns its interest in the joint venture.

(8) The Company’s ownership includes (1) a 35.79 % direct interest in the joint venture, (2) an additional 5.837 % indirect ownership in the joint venture, and (3) an additional 1 % interest in each of the two entities through which each partner owns its interest in the joint venture.

The Company’s partners will fund required capital until their aggregate investment is approximately 58 % of all capital contributions;

thereafter, the partners will fund required capital according to their percentage interests.

(9) The Company’s partner will fund required capital until their aggregate investment is approximately 80 % of all capital contributions;

thereafter, the partners will fund required capital according to their percentage interests.

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.

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The combined summarized balance sheets of the Company’s unconsolidated joint ventures are as follows:

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

(in thousands)

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_______________

(1) At March 31, 2022 and December 31, 2021, this amount included right of use assets - finance leases totaling approximately $ 248.9 million.

At March 31, 2022 and December 31, 2021, this amount included right of use assets - operating leases totaling approximately $ 22.0 million and $ 22.3 million, respectively.

(2) At March 31, 2022 and December 31, 2021, this amount included lease liabilities - finance leases totaling approximately $ 384.7 million and $ 385.5 million, respectively.

At March 31, 2022 and December 31, 2021, this amount included lease liabilities - operating leases totaling approximately $ 30.4 million.

(1) At June 30, 2022 and December 31, 2021, this amount included right of use assets - finance leases totaling approximately $ 248.9 million.

At June 30, 2022 and December 31, 2021, this amount included right of use assets - operating leases totaling approximately $ 21.7 million and $ 22.3 million, respectively.

(2) At June 30, 2022 and December 31, 2021, this amount included lease liabilities - finance leases totaling approximately $ 383.9 million and $ 385.5 million, respectively.

At June 30, 2022 and December 31, 2021, this amount included lease liabilities - operating leases totaling approximately $ 30.4 million.

(3) 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.

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The majority of the Company’s basis differences are as follows:

March 31, 2022 December 31, 2021

June 30, 2022 December 31, 2021

Property (in thousands)

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These basis differentials (excluding land) will be amortized over the remaining lives of the related assets and liabilities.

(4) Investments with deficit balances aggregating approximately $ 63.1 million and $ 37.1 million at March 31, 2022 and December 31, 2021, respectively, are reflected within Other Liabilities in the Company’s Consolidated Balance Sheets.

(4) Investments with deficit balances aggregating approximately $ 64.9 million and $ 37.1 million at June 30, 2022 and December 31, 2021, respectively, are reflected within Other Liabilities in the Company’s Consolidated Balance Sheets.

The combined summarized statements of operations of the Company’s unconsolidated joint ventures are as follows:

Three months ended March 31,

Three months ended June 30, Six months ended June 30,

2022 2021 2022 2021

(in thousands)

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Basis differential (3) ( 1,136 ) 764 ( 2,341 ) ( 628 )

Income from unconsolidated joint ventures $ 2,189 $ 5,225

Income (loss) from unconsolidated joint ventures $ ( 54 ) $ ( 1,373 ) $ 2,135 $ 3,852

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(1) Includes straight-line rent adjustments of approximately $ 27.5 million and $ 1.1 million for the three months ended March 31, 2022 and 2021, respectively.

For the three months ended March 31, 2022, reinstatement of accrued rent balances totaled approximately $ 2.5 million.

For the three months ended March 31, 2021, write-offs of accounts receivable and accrued rent balances totaled approximately $ 0.3 million.

(2) During the three months ended March 31, 2021, the Company completed the sale of its 50 % ownership interest in Annapolis Junction NFM LLC.

(1) Includes straight-line rent adjustments of approximately $ 17.8 million and $ 5.0 million for the three months ended June 30, 2022 and 2021, respectively, and approximately $ 45.3 million and $ 6.1 million for the six months ended June 30, 2022 and 2021, respectively.

For the six months ended June 30, 2022, reinstatement of accrued rent balances totaled approximately $ 2.5 million .

(2) During the six months ended June 30, 2021, the Company completed the sale of its 50 % ownership interest in Annapolis Junction NFM LLC.

The Company recognized a gain on sale of investment of approximately $ 10.3 million.

(3) Includes straight-line rent adjustments of approximately $ 0.1 million and $ 0.5 million for the three months ended March 31, 2022 and 2021, respectively.

Also includes net above-/below-market rent adjustments of approximately $ 0.1 million and $ 0.1 million for the three months ended March 31, 2022 and 2021, respectively.

(3) Includes straight-line rent adjustments of approximately $ 0.1 million for each of the three months ended June 30, 2022 and 2021, and approximately $ 0.2 million and $ 0.6 million for the six months ended June 30, 2022 and 2021, respectively.

Also includes net above-/below-market rent adjustments of approximately $ 0.1 million for each of the three months ended June 30, 2022 and 2021, and approximately $ 0.2 million for each of the six months ended June 30, 2022 and 2021.

On January 18, 2022, a joint venture in which the Company has a 50 % interest commenced the redevelopment of 651 Gateway located in South San Francisco, California.

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On February 2, 2022, a joint venture in which the Company has a 55 % interest commenced the development of the first phase of Platform 16, a Class A office project located in San Jose, California, that is expected to contain approximately 1.1 million net rentable square feet upon completion.

The first phase of the development project will include the construction of an approximately 390,000 net rentable square foot Class A creative office building and a below-grade parking garage.

The first phase of the development projects includes the construction of an approximately 390,000 net rentable square foot Class A creative office building and a below-grade parking garage.

On March 28, 2022, a joint venture in which the Company has a 20 % interest refinanced with a new lender the secured debt collateralized by its Metropolitan Square property located in Washington, DC.

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The new mortgage and mezzanine loans have an aggregate principal balance of $ 420.0 million, bear interest at a weighted average variable rate equal to the Secured Overnight Financing Rate (“SOFR“) plus 2.75 % per annum and mature on April 9, 2024, with three , one -year extension options, subject to certain conditions.

The joint venture distributed excess loan proceeds from the new mortgage and mezzanine loans totaling approximately $ 100.5 million, of which the Company’s share totaled approximately $ 20.1 million.

The joint venture distributed excess loan proceeds from the new mortgage and mezzanine loans totaling approximately $ 100.5 million, of which the Company’s share totaled approximately

$ 20.1 million.

Metropolitan Square is an office property with approximately 657,000 net rentable square feet located in Washington, DC.

On April 18, 2022, a joint venture in which the Company has a 50 % ownership interest extended the maturity date of the construction loan collateralized by its Hub50House property to June 19, 2022.

At the time of the extension, the outstanding balance of the loan totaled approximately $ 176.5 million, bore interest at a variable rate equal to LIBOR plus 2.00 % per annum and was scheduled to mature on April 19, 2022.

On June 17, 2022, the joint venture repaid the existing construction loan and obtained a new mortgage loan.

The new mortgage loan has a principal balance of $ 185.0 million, bears interest at a variable rate equal to SOFR plus 1.35 % per annum and matures on June 17, 2032.

At closing, the joint venture entered into interest rate swap contracts with notional amounts aggregating $ 185.0 million through April 10, 2032, resulting in a fixed rate of approximately 4.432 % per annum through the expiration of the interest rate swap contracts.

In conjunction with the new mortgage loan, the joint venture paid off the existing construction loan.

At the time of the payoff of the construction loan, the outstanding balance of the loan totaled approximately $ 176.7 million.

The joint venture distributed excess loan proceeds from the new mortgage loan totaling approximately $ 6.8 million, of which the Company’s share totaled approximately $ 3.4 million.

Hub50House is a residential property that consists of approximately 320,000 net rentable square feet and 440 residential units located in Boston, Massachusetts.

On May 13, 2022, the Company entered into a joint venture with a third party to own, operate and develop Reston Next Residential located in Reston, Virginia.

Reston Next Residential is expected to consist of 508 residential rental units upon completion.

The Company contributed approximately $ 11.3 million of improvements at closing and will contribute cash totaling approximately $ 3.5 million in the future for its 20 % ownership interest in the joint venture.

The partner contributed approximately $ 0.5 million of cash at closing and will contribute cash totaling approximately $ 58.7 million in the future for its 80 % ownership interest in the joint venture.

As a result of the partner’s deferred contribution, as of the acquisition date, the Company owned an approximately 96 % interest in the joint venture.

On May 13, 2022, the joint venture commenced development and entered into a construction loan collateralized by the property.

The construction loan has a principal amount of up to $ 140.0 million, bears interest at a variable rate equal to SOFR plus 2.00 % per annum and matures on May 13, 2026, with two , one -year extension options, subject to certain conditions.

As of June 30, 2022, no amounts had been drawn under the loan.

On June 16, 2022, the Company entered into a joint venture with a third party to own, operate and develop 751 Gateway, a laboratory building located in South San Francisco, California, that is expected to be approximately 231,000 net rentable square feet upon completion.

751 Gateway was previously part of the Company’s Gateway Commons joint venture.

The Company contributed assets with an agreed upon value aggregating approximately $ 53.9 million and cash totaling approximately $ 2.6 million for its 49 % ownership interest in the joint venture.

The partner contributed assets with an agreed upon value aggregating approximately $ 53.9 million and cash totaling approximately $ 4.9 million for its 51 % ownership interest in the joint venture.

Unsecured Term Loan

On May 17, 2022, BPLP entered into an unsecured credit agreement (the “Unsecured Term Loan”) providing for a single borrowing of up to $ 730.0 million.

The Unsecured Term Loan matures on May 16, 2023 .

At BPLP’s option, the Unsecured Term Loan will bear interest at a rate per annum equal to (A) (1) a base rate per annum equal to the greater of (a) the federal funds rate plus 0.5%, (b) the administrative agent’s prime rate, (c) term SOFR plus 1.00% and (d) 1.00%, or (2) a term SOFR rate per annum equal to the forward-looking SOFR term rate administered by CME Group Benchmark Administration (“CME”) two business days prior to the commencement of such interest period;

or if the rate is unavailable, then the forward-looking SOFR term rate administered by CME on the first business day immediately prior thereto, in each case, plus 0.10%, and (B) a margin ranging from 0 to 160 basis points based on BPLP’s credit rating.

On May 17, 2022, BPLP exercised its option to draw $ 730.0 million under the Unsecured Term Loan (See Note 3).

As of June 30, 2022, the Unsecured Term Loan bears interest at a variable rate equal to term SOFR plus 0.95 % per annum based on BPLP’s credit rating at June 30, 2022.

At June 30, 2022, BPLP had $ 730.0 million outstanding under the Unsecured Term Loan.

The Unsecured Term Loan contains customary representations and warranties, affirmative and negative covenants and events of default provisions, including the failure to pay indebtedness, breaches of covenants and bankruptcy and other insolvency events, which could result in the acceleration of the obligation to repay any outstanding amount under the Unsecured Term Loan.

Among other covenants, the Unsecured Term Loan requires that BPLP 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.

At June 30, 2022, BPLP was in compliance with each of these financial and other covenant requirements.

Commitments and Contingencies

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 had letter of credit and performance obligations related to lender and development requirements that total approximately $ 26.4 million at March 31, 2022.

In addition, in the normal course of business, the Company guarantees to certain clients 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 had letter of credit and performance obligations related to lender and development requirements that total approximately $ 26.4 million at June 30, 2022.

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.

From time to time, under certain of the Company’s joint venture agreements, if certain return thresholds are achieved, either the Company or its partners may 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, tenants and other third parties for the completion of development projects.

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, clients and other third parties for the completion of development projects.

The Company has agreements with its outside or joint venture partners whereby the partners agree to reimburse the joint venture for their share of any payments made under the guarantee.

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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 March 31, 2022, the maximum funding obligation under the guarantee was approximately $ 17.7 million.

As of June 30, 2022, the maximum funding obligation under the guarantee was approximately $ 16.2 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 March 31, 2022, no amounts related to the guarantee were recorded as liabilities in the Company’s consolidated financial statements.

In connection with the development of the 7750 Wisconsin Avenue office property located in Bethesda, Maryland, the Company entered into agreements with affiliates of The Bernstein Companies (the Company’s partner in the 7750 Wisconsin Avenue joint venture) whereby the Company could be required to act as a mezzanine and/or mortgage lender and finance the construction of the hotel property being developed by an affiliate of The Bernstein Companies adjacent to the office property.

An affiliate of The Bernstein Companies exercised its option to borrow $ 10.0 million from the Company under such agreements, which financing was provided by the Company on June 1, 2020.

The financing bears interest at a fixed rate of 8.00 % per annum, compounded monthly, and matures on the fifth anniversary of the date on which the base building of the affiliate of The Bernstein Companies’ hotel property is substantially completed.

The financing is collateralized by a pledge of the partner’s equity interest in the joint venture that owns and developed 7750 Wisconsin Avenue.

To secure such financing arrangements, affiliates of The Bernstein Companies are required to provide certain security, which varies depending on the specific loan, by pledges of their equity interest in the office property, a fee mortgage on the hotel property, or both.

The financing is recorded as Note Receivable, Net in the Company’s Consolidated Balance Sheets.

In connection with the redevelopment of the Company’s 325 Main Street property located in Cambridge, Massachusetts, the Company was required pursuant to the local zoning ordinance and urban renewal plan to commence construction of a residential building of at least 200,000 square feet with 25 % of the project designated as income-restricted (with a minimum of 20 % of the square footage devoted to home ownership units) prior to the occupancy of the 325 Main Street property, which is expected to occur during the third quarter of 2022.

As of June 30, 2022, no amounts related to the guarantee were recorded as liabilities in the Company’s consolidated financial statements.

In connection with the development of the 7750 Wisconsin Avenue office property located in Bethesda, Maryland, the Company entered into agreements with affiliates of The Bernstein Companies (the Company’s partner in the 7750 Wisconsin Avenue joint venture) under which the Company could be required to act as a mezzanine and/or mortgage lender and finance the construction of the hotel property being developed by an affiliate of The Bernstein Companies adjacent to the office property.

An affiliate of The Bernstein Companies exercised its option to borrow $ 10.0 million from the Company under such agreements, and the Company provided the financing on June 1, 2020.

The financing bore interest at a fixed rate of 8.00 % per annum, compounded monthly, and was scheduled to mature on the fifth anniversary of the date on which the base building of the affiliate of The Bernstein Companies’ hotel property was substantially completed.

On June 27, 2022, the borrower repaid the loan in full, including approximately $ 1.6 million of accrued interest.

The financing was recorded as Note Receivable, Net in the Company’s Consolidated Balance Sheets.

The zoning ordinance and urban renewal plan were each amended to decouple the residential requirement from the occupancy of the 325 Main Street property.

The amendment to the urban renewal plan is subject to final approvals and completion of administrative processes.

325 Main Street consisted of an approximately 115,000 net rentable square foot Class A office property that was demolished and is being developed into an approximately 420,000 net rentable square foot Class A office property, including approximately 41,000 net rentable square feet of retail space.

325 Main Street consisted of an approximately 115,000 net rentable square foot Class A office property that was demolished and

redeveloped into an approximately 414,000 net rentable square foot Class A office property.

While the amendment to the urban renewal plan is subject to completion of administrative processes, the City of Cambridge issued a temporary certificate of occupancy in the second quarter of 2022 (See Note 3).

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”).

25 unchanged sentences

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, pandemics 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.

With respect to

such losses and losses from acts of terrorism, earthquakes, pandemics 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.

1 unchanged sentence

Noncontrolling interests relate to the interests in BPLP not owned by BXP and interests in consolidated property partnerships not wholly-owned by the Company.

As of March 31, 2022, the noncontrolling interests in BPLP consisted of 16,550,441 OP Units, 1,678,082 LTIP Units (including 466,233 LTIP Units earned by employees under the Company’s multi-year long-term incentive awards granted between 2012 and 2019 (i.e., 2012 OPP and 2013 - 2019 MYLTIP awards)), 203,278 2020 MYLTIP Units, 351,447 2021 MYLTIP Units and 254,061 2022 MYLTIP Units held by parties other than BXP.

As of June 30, 2022, the noncontrolling interests in BPLP consisted of 16,539,178 OP Units, 1,685,357 LTIP Units (including 466,233 LTIP Units earned by employees under the Company’s multi-year long-term incentive awards granted between 2012 and 2019 (i.e., 2012 OPP and 2013 - 2019 MYLTIP awards)), 203,278 2020 MYLTIP Units, 351,218 2021 MYLTIP Units and 253,627 2022 MYLTIP Units held by parties other than BXP.

Noncontrolling Interest—Common Units

During the three months ended March 31, 2022, 141,188 OP Units were presented by the holders for redemption (including 36,508 OP Units issued upon conversion of LTIP Units, 2012 OPP Units and MYLTIP Units) and were redeemed by BXP in exchange for an equal number of shares of Common Stock.

At March 31, 2022, BPLP had outstanding 203,278 2020 MYLTIP Units, 351,447 2021 MYLTIP Units and 254,061 2022 MYLTIP Units.

During the six months ended June 30, 2022, 152,451 OP Units were presented by the holders for redemption (including an aggregate of 47,771 OP Units issued upon conversion of LTIP Units, 2012 OPP Units and MYLTIP Units) and were redeemed by BXP in exchange for an equal number of shares of Common Stock.

At June 30, 2022, BPLP had outstanding 203,278 2020 MYLTIP Units, 351,218 2021 MYLTIP Units and 253,627 2022 MYLTIP Units.

Prior to the end of the respective three -year performance period for each plan, holders of MYLTIP Units are 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.

After the three-year performance period for each plan has ended, (1) 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 and (2) with respect to the 2021 MYLTIP and 2022 MYLTIP only, the Company will make a “catch-up” cash payment on the MYLTIP Units that are ultimately earned in an amount equal to the regular and special dividends, if any, declared during the performance period on Common Stock, less the distributions actually paid during the performance period on all of the awarded 2021 MYLTIP Units and 2022 MYLTIP Units.

On February 4, 2022, the measurement period for the Company’s 2019 MYLTIP awards ended and, based on BXP’s relative TSR performance, the final payout was determined to be 69.0 % of target, or an aggregate of approximately $ 8.6 million (after giving effect to employee separations).

As a result, an aggregate of 144,043 2019 MYLTIP Units that had been previously granted were automatically forfeited.

The following table presents BPLP’s distributions on the OP Units and LTIP Units (including the 2012 OPP Units, 2013 - 2018 MYLTIP Units and, after the February 4, 2022 measurement date, the 2019 MYLTIP Units) and its distributions on the 2019 MYLTIP Units (prior to the February 4, 2022 measurement date) and 2020 - 2022 MYLTIP Units (after the February 1, 2022 issuance date of the 2022 MYLTIP Units) that occurred during the three months ended March 31, 2022:

Record Date Payment Date Distributions per OP Unit and LTIP Unit Distributions per MYLTIP Unit

June 30, 2022 July 29, 2022 $ 0.98 $ 0.098

March 31, 2022 April 29, 2022 $ 0.98 $ 0.098

December 31, 2021 January 28, 2022 $ 0.98 $ 0.098

The following table presents BPLP’s distributions on the OP Units and LTIP Units (including the 2012 OPP Units, 2013 - 2017 MYLTIP Units and, after the February 5, 2021 measurement date, the 2018 MYLTIP Units) and its distributions on the 2018 MYLTIP Units (prior to the February 5, 2021 measurement date) and 2019 - 2021 MYLTIP Units (after the February 2, 2021 issuance date of the 2021 MYLTIP Units) that occurred during the three months ended March 31, 2021:

Record Date Payment Date Distributions per OP Unit and LTIP Unit Distributions per MYLTIP Unit

June 30, 2021 July 30, 2021 $ 0.98 $ 0.098

March 31, 2021 April 30, 2021 $ 0.98 $ 0.098

3 unchanged sentences

BXP 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 (LTIP Units (including the 2012 OPP Units and 2013 - 2019 MYLTIP

Units) assuming that all conditions had been met for the conversion thereof) had all of such units been redeemed at March 31, 2022 was approximately $ 2.3 billion based on the last reported price of a share of Common Stock on the New York Stock Exchange of $ 128.80 per share on March 31, 2022.

The value of the OP Units (LTIP Units (including the 2012 OPP Units and 2013 - 2019 MYLTIP Units) assuming that all conditions had been met for the conversion thereof) had all of such units been redeemed at June 30, 2022 was approximately $ 1.6 billion based on the last reported price of a share of Common Stock on the New York Stock Exchange of $ 88.98 per share on June 30, 2022.

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 $ 1.5 billion and $ 1.6 billion a t March 31, 2022 and December 31, 2021, respectively, are included in Noncontrolling Interests—Property Partnerships on the accompanying Consolidated Balance Sheets.

The equity interests in these ventures that are not owned by the Company, totaling approximately $ 1.6 billion a t each of June 30, 2022 and December 31, 2021 are included in Noncontrolling Interests—Property Partnerships on the accompanying Consolidated Balance Sheets.

Stockholders’ Equity / Partners’ Capital

As of March 31, 2022, BXP had 156,711,714 shares of Common Stock outstanding.

As of March 31, 2022, BXP owned 1,749,402 general partnership units and 154,962,312 limited partnership units in BPLP.

As of June 30, 2022, BXP had 156,726,430 shares of Common Stock outstanding.

As of June 30, 2022, BXP owned 1,749,510 general partnership units and 154,976,920 limited partnership units in BPLP.

On May 22, 2020, 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.

3 unchanged sentences

No shares of Common Stock have been issued under this ATM stock offering program.

During the three months ended March 31, 2022, BXP did not issue any shares of Common Stock upon the exercise of options to purchase Common Stock.

During the three months ended March 31, 2022, BXP issued 141,148 shares of Common Stock in connection with the redemption of an equal number of redeemable OP Units from limited partners.

The following table presents BXP’s dividends per share and BPLP’s distributions per OP Unit and LTIP Unit paid or declared in 2022 and during the three months ended March 31, 2021:

During the six months ended June 30, 2022, BXP did not issue any shares of Common Stock upon the exercise of options to purchase Common Stock.

During the six months ended June 30, 2022, BXP issued 152,451 shares of Common Stock in connection with the redemption of an equal number of redeemable OP Units from limited partners.

The following table presents BXP’s dividends per share and BPLP’s distributions per OP Unit and LTIP Unit paid or declared in 2022 and during the six months ended June 30, 2021:

Record Date Payment Date Dividend (Per Share) Distribution (Per Unit)

June 30, 2022 July 29, 2022 $ 0.98 $ 0.98

March 31, 2022 April 29, 2022 $ 0.98 $ 0.98

December 31, 2021 January 28, 2022 $ 0.98 $ 0.98

June 30, 2021 July 30, 2021 $ 0.98 $ 0.98

March 31, 2021 April 30, 2021 $ 0.98 $ 0.98

8 unchanged sentences

In connection with the redemption of the Series B Preferred Stock, all of the Series B Preferred Units, which had terms and preferences generally mirroring those of the Series B Preferred Stock, were redeemed by BPLP.

The following table presents BXP’s dividend per share on its Series B Preferred Stock paid during the three months ended March 31, 2021:

The following table presents BXP’s dividend per share on its Series B Preferred Stock paid during the six months ended June 30, 2021:

Record Date Payment Date Dividend (Per Share)

2 unchanged sentences

The following tables present reconciliations of Net Income Attributable to Boston Properties, Inc.

Common Shareholders to the Company’s share of Net Operating Income and Net Income Attributable to Boston Properties Limited Partnership Common Unitholders to the Company’s share of Net Operating Income for the three months ended March 31, 2022 and 2021.

Three months ended March 31,

Three months ended June 30, Six months ended June 30,

2022 2021 2022 2021

(in thousands)

13 unchanged sentences

Payroll and related costs from management services contracts

3,239 2,655 7,304 6,160

General and administrative expense 34,665 38,405 77,859 83,364

2 unchanged sentences

Gains (losses) from investments in securities ( 4,716 ) 2,275 ( 6,978 ) 3,934

Other income - assignment fee 6,624 — 6,624 —

Interest and other income (loss) 1,195 1,452 2,423 2,620

Gains on sales of real estate 96,247 7,756 118,948 7,756

Income from unconsolidated joint ventures 2,189 5,225

Income (loss) from unconsolidated joint ventures ( 54 ) ( 1,373 ) 2,135 3,852

Direct reimbursements of payroll and related costs from management services contracts

3,239 2,655 7,304 6,160

Development and management services revenue 6,354 7,284 12,185 14,087

Company’s share of Net Operating Income $ 471,890 $ 432,299 $ 931,472 $ 856,665

Three months ended March 31,

Three months ended June 30, Six months ended June 30,

2022 2021 2022 2021

(in thousands)

10 unchanged sentences

Payroll and related costs from management services contracts

3,239 2,655 7,304 6,160

General and administrative expense 34,665 38,405 77,859 83,364

2 unchanged sentences

Gains (losses) from investments in securities ( 4,716 ) 2,275 ( 6,978 ) 3,934

Other income - assignment fee 6,624 — 6,624 —

Interest and other income (loss) 1,195 1,452 2,423 2,620

Gains on sales of real estate 99,608 7,756 122,992 7,756

Income from unconsolidated joint ventures 2,189 5,225

Income (loss) from unconsolidated joint ventures ( 54 ) ( 1,373 ) 2,135 3,852

Direct reimbursements of payroll and related costs from management services contracts

3,239 2,655 7,304 6,160

Development and management services revenue 6,354 7,284 12,185 14,087

1 unchanged sentence

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, as applicable, the most directly comparable GAAP financial measures, plus (1) preferred stock/unit redemption charge, preferred dividends/distributions, net income attributable to noncontrolling interests, interest expense, losses from early extinguishment of debt, depreciation and amortization expense, transaction costs, payroll and related costs from management services contracts and corporate general and administrative expense less (2) gains (losses) from investments in securities, interest and other income (loss), gains on sales of real estate, income from unconsolidated joint ventures, direct reimbursements of payroll and related costs from management services contracts and development and management services revenue.

common shareholders and net income attributable to Boston Properties Limited Partnership common unitholders, as applicable, the most directly comparable GAAP financial measures, plus (1) preferred stock/unit redemption charge, preferred dividends/distributions, net income attributable to noncontrolling interests, interest expense, losses from early extinguishment of debt, depreciation and amortization expense, transaction costs, payroll and related costs from management services contracts and corporate general and administrative expense less (2) gains (losses) from investments in securities, other income - assignment fee, interest and other income (loss), gains on sales of real estate, income (loss) from unconsolidated joint ventures, direct reimbursements of payroll and related costs from management services contracts 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 results of operations and financial condition because, when compared across periods, it reflects the impact on operations from trends in occupancy rates, rental rates, operating costs and acquisition and development activity on an unleveraged basis, providing perspective not immediately apparent from net income attributable to Boston Properties, Inc.

2 unchanged sentences

Similarly, interest expense may be incurred at the property level even though the financing proceeds may be used at the corporate level (e.g., used for other investment activity).

In addition, depreciation and amortization expense, because of historical cost accounting and useful life estimates, may distort operating performance measures at the property level.

In addition, depreciation and amortization expense, because of historical cost accounting and useful life estimates, 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.

The Company’s internal reporting utilizes its share of NOI, which includes its share of NOI from consolidated and unconsolidated joint ventures, which is a non-GAAP financial measure that is calculated as the consolidated amount, plus the Company’s share of the amount from the Company’s unconsolidated joint ventures (calculated based upon the Company’s economic percentage ownership interest and, in some cases, after priority allocations), minus the Company’s partners’ share of the amount from the Company’s consolidated joint ventures (calculated based upon the partners’ economic percentage ownership interests and, in some cases, after priority allocations, income allocation to private REIT shareholders and their share of fees due to the Company).

The Company’s share of NOI from unconsolidated joint ventures does not include its share of gains on sales of real estate from unconsolidated joint ventures and gain on sale of investment from unconsolidated joint ventures, both of which are included within Loss From Unconsolidated Joint Ventures in the Company’s Consolidated Statements of Operations.

The Company’s internal reporting utilizes its share of NOI, which includes its share of NOI from consolidated and unconsolidated joint ventures, which is a non-GAAP financial measure that is calculated as the consolidated amount, plus the Company’s share of the amount from the Company’s unconsolidated joint ventures (calculated based upon the Company’s economic percentage ownership interest and, in some cases, after priority allocations), less the Company’s partners’ share of the amount from the Company’s consolidated joint ventures (calculated based upon the partners’ economic percentage ownership interests and, in some cases, after priority allocations, income allocation to private REIT shareholders and their share of fees due to the Company).

The Company’s share of NOI from unconsolidated joint ventures does not include its share of losses from early extinguishment of debt from unconsolidated joint ventures, gains on sales of real estate from unconsolidated joint ventures and gain on sale of investment from unconsolidated joint ventures, both of which are included within Income (Loss) From Unconsolidated Joint Ventures in the Company’s Consolidated Statements of Operations.

Management utilizes its share of NOI in assessing its performance as the Company has several significant joint ventures and, in some cases, the Company exercises significant influence over, but does not control, the joint venture, in which case GAAP requires that the Company account for the joint venture entity using the equity method of accounting and the Company does not consolidate it for financial reporting purposes.

3 unchanged sentences

Therefore, depreciation and amortization expense is not allocated among segments.

Preferred stock/unit redemption charge, preferred dividends/distributions, interest expense, losses from early extinguishment of debt, depreciation and amortization expense, transaction costs, payroll and related costs from management services contracts, corporate general and administrative expense, gains (losses) from investments in securities, interest and other income (loss), gains on sales of real estate, income from unconsolidated joint ventures, direct reimbursements of payroll and related costs from management services contracts and development and management services revenue are not included in NOI and are provided as reconciling items to the Company’s reconciliations of its share of NOI to net income attributable to common shareholders/unitholders.

Preferred stock/unit redemption charge, preferred dividends/distributions, interest expense, losses from early extinguishment of debt, depreciation and amortization expense, transaction costs, payroll and related costs from management services contracts, corporate general and administrative expense, gains (losses) from investments in securities, other income - assignment fee, interest and other income (loss), gains on sales of real estate, income (loss) from unconsolidated joint ventures, direct reimbursements of payroll and related costs from management services contracts and development and management services revenue are not included in NOI and are provided as reconciling items to the Company’s reconciliations of its share of NOI to net income attributable to common shareholders/unitholders.

The Company’s segments are based on the Company’s method of internal reporting which classifies its operations by geographic area.

3 unchanged sentences

The Company also presents information for each segment by property type, including Office, Residential and Hotel.

Parking and other revenue for the three months ended March 31, 2022 increased by approximately $ 4.8 million compared to the three months ended March 31, 2021.

Parking and other revenue for the three months ended June 30, 2022 increased by approximately $ 12.1 million compared to the three months ended June 30, 2021.

Parking and other revenue for the six months

ended June 30, 2022 increased by approximately $ 16.9 million compared to 2021.

These increases were primarily in transient and monthly parking revenue.

The decreased demand for and occupancy of the Boston Marriott Cambridge hotel have had, and are expected to continue to have, a material adverse effect on its operations and thus the results of the Company’s Hotel property type.

Information by geographic area and property type (dollars in thousands):

For the three months ended March 31, 2022:

For the three months ended June 30, 2022:

Boston Los Angeles New York San Francisco Seattle Washington, DC Total

19 unchanged sentences

(1) Rental Revenue is equal to Total Revenue per the Company’s Consolidated Statements of Operations, less Development and Management Services Revenue and Direct Reimbursements of Payroll and Related Costs from Management Services Contracts Revenue per the Consolidated Statements of Operations.

For the three months ended March 31, 2021:

For the three months ended June 30, 2021:

Boston Los Angeles New York San Francisco Washington, DC Total

19 unchanged sentences

Information by geographic area and property type (dollars in thousands):

For the six months ended June 30, 2022:

Boston Los Angeles New York San Francisco Seattle Washington, DC Total

Rental Revenue:

Office $ 487,014 $ — $ 511,134 $ 266,082 $ 6,472 $ 191,519 $ 1,462,221

Residential 7,344 — — 8,241 — 14,293 29,878

Hotel 16,646 — — — — — 16,646

Total 511,004 — 511,134 274,323 6,472 205,812 1,508,745

% of Grand Totals 33.87 % — % 33.88 % 18.18 % 0.43 % 13.64 % 100.00 %

Rental Expenses:

Office 177,555 — 191,703 88,609 1,680 68,306 527,853

Residential 2,929 — — 7,013 — 6,308 16,250

Hotel 11,284 — — — — — 11,284

Total 191,768 — 191,703 95,622 1,680 74,614 555,387

% of Grand Totals 34.53 % — % 34.52 % 17.22 % 0.30 % 13.43 % 100.00 %

Net operating income $ 319,236 $ — $ 319,431 $ 178,701 $ 4,792 $ 131,198 $ 953,358

% of Grand Totals 33.49 % — % 33.51 % 18.74 % 0.50 % 13.76 % 100.00 %

Net operating income attributable to noncontrolling interests in property partnerships ( 23,112 ) — ( 71,805 ) — — — ( 94,917 )

Company’s share of net operating income (loss) from unconsolidated joint ventures 17,827 27,004 ( 138 ) 6,364 3,899 18,075 73,031

Company’s share of net operating income $ 313,951 $ 27,004 $ 247,488 $ 185,065 $ 8,691 $ 149,273 $ 931,472

% of Grand Totals 33.70 % 2.90 % 26.57 % 19.87 % 0.93 % 16.03 % 100.00 %

_______________

For the six months ended June 30, 2021:

Boston Los Angeles New York San Francisco Washington, DC Total

Rental Revenue:

Office $ 459,974 $ — $ 502,346 $ 256,779 $ 167,025 $ 1,386,124

Residential 6,176 — — 1,011 11,751 18,938

Hotel 2,193 — — — — 2,193

Total 468,343 — 502,346 257,790 178,776 1,407,255

% of Grand Totals 33.28 % — % 35.70 % 18.32 % 12.70 % 100.00 %

Rental Expenses:

Office 158,046 — 192,047 81,203 62,741 494,037

Residential 2,890 — — 3,230 5,935 12,055

Hotel 4,047 — — — — 4,047

Total 164,983 — 192,047 84,433 68,676 510,139

% of Grand Totals 32.34 % — % 37.65 % 16.55 % 13.46 % 100.00 %

Net operating income $ 303,360 $ — $ 310,299 $ 173,357 $ 110,100 $ 897,116

% of Grand Totals 33.82 % — % 34.59 % 19.32 % 12.27 % 100.00 %

Net operating income attributable to noncontrolling interests in property partnerships ( 20,800 ) — ( 69,863 ) — — ( 90,663 )

Company’s share of net operating income (loss) from unconsolidated joint ventures 5,905 26,457 ( 621 ) 7,060 11,411 50,212

Company’s share of net operating income $ 288,465 $ 26,457 $ 239,815 $ 180,417 $ 121,511 $ 856,665

% of Grand Totals 33.68 % 3.09 % 27.99 % 21.06 % 14.18 % 100.00 %

_______________

Earnings Per Share / Common Unit

8 unchanged sentences

Other potentially dilutive common shares, including stock options, restricted stock and other securities of BPLP that are exchangeable for BXP’s Common Stock, and the related impact on earnings, are considered when calculating diluted EPS.

Three months ended March 31, 2022

Three months ended June 30, 2022

(Numerator) Shares

5 unchanged sentences

$ 222,989 156,720 $ 1.42

Allocation of undistributed earnings to participating securities

Net income attributable to Boston Properties, Inc.

common shareholders

222,722 156,720 1.42

Effect of Dilutive Securities:

4 unchanged sentences

$ 222,722 157,192 $ 1.42

Three months ended March 31, 2021

Three months ended June 30, 2021

(Numerator) Shares

7 unchanged sentences

Stock Based Compensation

— 412 ( 0.01 )

Diluted Earnings:

2 unchanged sentences

$ 111,703 156,519 $ 0.71

Six months ended June 30, 2022

(Numerator) Shares

(Denominator) Per Share

(in thousands, except for per share amounts)

Basic Earnings:

Net income attributable to Boston Properties, Inc.

common shareholders

$ 366,044 156,685 $ 2.33

Allocation of undistributed earnings to participating securities

Net income attributable to Boston Properties, Inc.

common shareholders

365,808 156,685 2.33

Effect of Dilutive Securities:

Stock Based Compensation

Diluted Earnings:

Net income attributable to Boston Properties, Inc.

common shareholders

$ 365,808 157,098 $ 2.33

Six months ended June 30, 2021

(Numerator) Shares

(Denominator) Per Share

(in thousands, except for per share amounts)

Basic Earnings:

Net income attributable to Boston Properties, Inc.

common shareholders

$ 203,372 156,016 $ 1.30

Effect of Dilutive Securities:

Stock Based Compensation

Diluted Earnings:

Net income attributable to Boston Properties, Inc.

common shareholders

$ 203,372 156,307 $ 1.30

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.

5 unchanged sentences

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 17,626,000 and 17,089,000 redeemable common units for the three months ended March 31, 2022 and 2021, respectively.

Three months ended March 31, 2022

Included in the number of units (the denominator) below are approximately 17,672,000 and 17,043,000 redeemable common units for the three months ended June 30, 2022 and 2021, respectively, and 17,638,000 and 17,018,000 redeemable common units for the six months ended June 30, 2022 and 2021, respectively.

Three months ended June 30, 2022

(Numerator) Units

3 unchanged sentences

Net income attributable to Boston Properties Limited Partnership common unitholders $ 253,788 174,392 $ 1.45

Allocation of undistributed earnings to participating securities ( 297 ) — —

Net income attributable to Boston Properties, Inc.

common shareholders

253,491 174,392 1.45

4 unchanged sentences

$ 253,491 174,864 $ 1.45

Three months ended March 31, 2021

Three months ended June 30, 2021

(Numerator) Units

9 unchanged sentences

$ 125,846 173,562 $ 0.73

Six months ended June 30, 2022

(Numerator) Units

(Denominator) Per Unit

(in thousands, except for per unit amounts)

Basic Earnings:

Net income attributable to Boston Properties Limited Partnership common unitholders

$ 415,617 174,323 $ 2.38

Allocation of undistributed earnings to participating securities

Net income attributable to Boston Properties Limited Partnership common unitholders

$ 415,354 174,323 $ 2.38

Effect of Dilutive Securities:

Stock Based Compensation

Diluted Earnings:

Net income attributable to Boston Properties Limited Partnership common unitholders

$ 415,354 174,736 $ 2.38

Six months ended June 30, 2021

(Numerator) Units

(Denominator) Per Unit

(in thousands, except for per unit amounts)

Basic Earnings:

Net income attributable to Boston Properties Limited Partnership common unitholders

$ 231,619 173,034 $ 1.34

Effect of Dilutive Securities:

Stock Based Compensation

Diluted Earnings:

Net income attributable to Boston Properties Limited Partnership common unitholders

$ 231,619 173,325 $ 1.34

Stock Option and Incentive Plan

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The number of LTIP Units that can be earned under this component ranges from zero to 200% of the target number of LTIP Units, based on BXP’s three-year, annualized relative TSR performance compared to a custom index of peer companies.

Under this component, 100% of the target number of LTIP Units will be earned if BXP’s TSR equals the custom index TSR;

Under this component, 100% of the target number of LTIP Units will be earned if BXP’s

TSR equals the custom index TSR;

for relative TSR performance between -1,000 basis points and +1,000 basis points, the number of LTIP Units earned will be determined using linear interpolation.

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If there is a change of control prior to January 31, 2025, earned awards will be calculated based on TSR performance up to the date of the change of control.

The 2022 MYLTIP awards are in the form of LTIP Units issued

on the grant date, and they are subject to forfeiture to the extent awards are not earned.

The 2022 MYLTIP awards are in the form of LTIP Units issued on the grant date, and they are subject to forfeiture to the extent awards are not earned.

Prior to the performance measurement date holders of the 2022 MYLTIP Units are only entitled to one-tenth ( 10 %) of the regular quarterly distributions payable on common partnership units.

Following the completion of the three -year performance period, BXP will also make a “catch-up” cash payment on the 2022 MYLTIP Units that are ultimately earned in an amount equal to the regular and special distributions, if any, declared during the performance period on BXP’s Common Stock, less the distributions actually paid to holders of 2022 MYLTIP Units during the performance period on all of the awarded 2022 MYLTIP Units.

Following the completion of the three -year performance period, the Company will also make a “catch-up” cash payment on the 2022 MYLTIP Units that are ultimately earned in an amount equal to the regular and special distributions, if any, declared during the performance period on BXP’s Common Stock, less the distributions actually paid to holders of 2022 MYLTIP Units during the performance period on all of the awarded 2022 MYLTIP Units.

Under ASC 718 “Compensation - Stock Compensation,” the 2022 MYLTIP awards have an aggregate value of approximately $ 17.3 million, which amount will generally be amortized into earnings under the graded vesting method.

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As a result, an aggregate of 144,043 2019 MYLTIP Units that had been previously granted were automatically forfeited.

During the three months ended March 31, 2022, BXP issued 33,411 shares of restricted common stock and BPLP issued 250,893 LTIP Units and 254,061 2022 MYLTIP Units to employees and non-employee directors under the 2021 Plan.

During the six months ended June 30, 2022, BXP issued 37,871 shares of restricted common stock and BPLP issued 261,421 LTIP Units and 254,061 2022 MYLTIP Units to employees and non-employee directors under the 2021 Plan.

Employees and non-employee directors paid $ 0.01 per share of restricted common stock and $ 0.25 per LTIP Unit and 2022 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 of Boston Properties, Inc.

and Boston Properties Limited Partnership.

The aggregate value of the LTIP Units is included in noncontrolling interests in the Consolidated Balance Sheets of BXP and BPLP.

A substantial majority of the grants of restricted common stock and LTIP Units to employees vest in four equal annual installments.

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Such value is recognized as an expense ratably over the corresponding employee service period.

The shares of restricted common stock granted during the three months ended March 31, 2022 were valued at approximately $ 3.9 million ($ 113.79 per share weighted-average).

The shares of restricted common stock granted during the six months ended June 30, 2022 were valued at approximately $ 4.3 million ($ 113.58 per share weighted-average).

The LTIP Units granted were valued at approximately $ 28.2 million (approximately $ 108.02 per unit weighted-average fair value) using a Monte Carlo simulation method model.

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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, LTIP Units and MYLTIP Units was approximately $ 20.9 million and $ 19.8 million for the three months ended March 31, 2022 and 2021, respectively.

At March 31, 2022, there was (1) an aggregate of approximately $ 37.0 million of unrecognized compensation expense related to unvested restricted stock, LTIP Units and 2019 MYLTIP Units and (2) an aggregate of approximately $ 16.0 million of unrecognized compensation expense related to unvested 2020 - 2022 MYLTIP Units that is expected to be recognized over a weighted-average period of approximately 2.3 years.

Aggregate stock-based compensation expense associated with restricted stock, LTIP Units and MYLTIP Units was approximately $ 14.6 million and $ 14.0 million for the three months ended June

30, 2022 and 2021, respectively, and $ 35.5 million and $ 33.8 million for the six months ended June 30, 2022 and 2021, respectively.

At June 30, 2022, there was (1) an aggregate of approximately $ 29.5 million of unrecognized compensation expense related to unvested restricted stock, LTIP Units and 2019 MYLTIP Units and (2) an aggregate of approximately $ 9.6 million of unrecognized compensation expense related to unvested 2020 - 2022 MYLTIP Units that is expected to be recognized over a weighted-average period of approximately 2.1 years.

Subsequent Events

On April 7, 2022, the Company executed an agreement to assign its right to acquire 11251 Roger Bacon Drive in Reston, Virginia to a third party for an assignment fee of approximately $ 6.9 million.

11251 Roger Bacon Drive is an approximately 65,000 square foot office building situated on approximately 2.6 acres (See Note 3).

On April 14, 2022, the Company entered into an agreement to acquire Madison Centre in Seattle, Washington for a gross purchase price of $ 730.0 million.

Pursuant to the agreement, the Company made a $ 50.0 million non-refundable deposit that will be credited towards the purchase price at closing.

Madison Centre is an approximately 760,000 square foot, 37 -story Class A office building.

The acquisition is subject to customary closing conditions, and there can be no assurance that this acquisition will occur on the terms currently contemplated or at all.

On April 18, 2022, a joint venture in which the Company has a 50 % ownership interest extended the construction loan collateralized by its Hub50House property.

At the time of the extension, the outstanding balance of the loan totaled approximately $ 176.5 million and the loan bore interest at a variable rate equal to LIBOR plus 2.00 % per annum and was scheduled to mature on April 19, 2022.

The extended loan matures on June 19, 2022 .

Hub50House is a residential property that consists of approximately 320,000 net rentable square feet and 440 residential units located in Boston, Massachusetts.

On April 27, 2022, the Company entered into a lease agreement with AstraZeneca to lease approximately 570,000 square feet at the Company’s 290 Binney Street future development project.

290 Binney Street is part of the initial phase of a future life sciences development project located in the heart of Kendall Square in Cambridge, Massachusetts.

The full project will consist of two buildings aggregating approximately 1.1 million rentable square feet of life sciences space and an approximately 400,000 square foot residential building.

The lease and commencement of construction are subject to various conditions, some of which are not within the Company’s control.

There can be no assurance that the conditions will be satisfied or that the Company will commence the development on the terms and schedule currently contemplated or at all.

The Company has evaluated subsequent events and transactions through August 5, 2022, the date the Consolidated Financial Statements were available to be issued.

There were no events or transactions that occurred that would require recognition or disclosure in the Consolidated Financial Statements.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements