What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2024-05-10 compared with 2023-11-07 · 520 added, 956 removed, 585 unchanged (72% of the section changed)

1 unchanged sentence

The following discussion should be read in conjunction with the financial statements and notes thereto appearing elsewhere in this report.

This Quarterly Report on Form 10-Q, including the documents incorporated by reference, contain forward-looking statements within the meaning of the federal securities laws, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.

We intend these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and we are including this statement for purposes of complying with those safe harbor provisions, in each case, to the extent applicable.

6 unchanged sentences

The most significant factors that may cause actual results to differ materially from those expressed or implied by the forward-looking statements include the risks and uncertainties related to the impact of changes in general economic and capital market conditions, including continued inflation, increasing interest rates, supply chain disruptions, labor market disruptions, dislocation and volatility in capital markets, and potential longer-term changes in consumer and client behavior resulting from the severity and duration of any downturn in the U.S.

or global economy, sustained changes in client preferences and space utilization, as well as the other important factors below and the risks described in (i) our Annual Report on Form 10-K for the fiscal year ended December 31, 2022 including those described under the caption “Risk Factors,” (ii) our Quarterly Report on Form 10-Q for the fiscal quarters ended March 31, 2023 and June 30, 2023, (iii) our subsequent filings under the Exchange Act and (iv) the risk factors set forth in this Form 10-Q in Part II, Item 1A, if any.

or global economy, sustained changes in client preferences and space utilization, as well as the other important factors below and the risks described in (i) our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 including those described under the caption “Risk Factors,” (ii) our subsequent filings under the Exchange Act and (iii) the risk factors set forth in this Form 10-Q in Part II, Item 1A, if any.

Some of the risks and uncertainties that may cause our actual results, performance or achievements to differ materially from those expressed or implied by forward-looking statements include, among others, the following:

• volatile or adverse global economic and geopolitical conditions, health crises, dislocations in the credit markets and potential financial contagion from recent or future failures of banking institutions could adversely affect economic conditions and/or restrict our access to cost-effective capital, which could have a material adverse effect on our business opportunities, results of operations and financial condition;

• volatile or adverse global economic and geopolitical conditions, health crises and dislocations in the credit markets could adversely affect economic conditions and/or restrict our access to cost-effective capital, which could have a material adverse effect on our business opportunities, results of operations and financial condition;

• general risks affecting the real estate industry (including, without limitation, the inability to enter into or renew leases, changes in client preferences and space utilization, dependence on clients’ financial condition, and competition from other developers, owners and operators of real estate);

• the impact of geopolitical conflicts;

• the immediate and long-term impact of the outbreak of a highly infectious or contagious disease on our and our clients’ financial condition, results of operations and cash flows (including the impact of actions taken to contain the outbreak or mitigate its impact, the direct and indirect economic effects of the outbreak and containment measures on our clients, and the ability of our clients to successfully operate their businesses);

• failure to manage effectively our growth and expansion into new markets and sub-markets or to integrate acquisitions and developments successfully;

7 unchanged sentences

• risks associated with climate change and severe weather events, as well as the regulatory efforts intended to reduce the effects of climate change;

• risks associated with security breaches through cyber attacks, cyber intrusions or otherwise, as well as other significant disruptions of our information technology (IT) networks and related systems, which support our operations and our buildings;

• risks associated with security breaches, incidents, and compromises through cyber-attacks, cyber intrusions or otherwise, as well as other significant disruptions of our information technology (IT) networks and related systems, which support our operations and our buildings;

• risks associated with legal proceedings and other claims that could result in substantial monetary and other costs;

• risks associated with BXP’s potential failure to qualify as a REIT under the Internal Revenue Code of 1986, as amended;

10 unchanged sentences

We expressly disclaim any responsibility to update any forward-looking statements to reflect changes in underlying assumptions or factors, new information, future events, or otherwise, and you should not rely upon these forward-looking statements after the date of this report.

BXP is one of the largest publicly traded office real estate investment trusts (REITs) (based on total market capitalization as of September 30, 2023) in the U.S.

BXP is one of the largest publicly traded office real estate investment trusts (REITs) (based on total market capitalization as of March 31, 2024) in the U.S.

that develops, owns, and manages primarily premier workplaces.

3 unchanged sentences

We generate revenue and cash primarily by leasing premier workplaces to our clients.

When making leasing decisions, we consider, among other things, the creditworthiness of the client and the industry in which it conducts business, the length of the lease, the rental rate to be paid at inception and throughout the lease term, the amount of any security deposit or letter of credit posted by the client, the costs of tenant improvements, free rent periods and other landlord concessions, anticipated operating expenses and real estate taxes, current and anticipated vacancy in our

properties and the market overall (including sublease space), current and expected future demand for the space, the impact of other clients’ expansion rights, and general economic factors.

Our core strategy has always been to develop, acquire and manage premier workplaces in gateway markets with high barriers-to-entry and attractive demand drivers, and to focus on executing long-term leases with financially strong clients.

Our client base is diverse across market sectors.

As of September 30, 2023, the weighted-average remaining lease term for our in-place leases based on square feet, including those signed by our unconsolidated joint ventures but excluding residential units, was approximately 7.6 years.

The weighted-average remaining lease term for our 20 largest clients, based on leased square footage, was approximately 10.5 years as of September 30, 2023.

We believe the key competitive advantages for BXP are our commitment to the office asset class and to our clients as many competitors disinvest in the sector, a strong balance sheet with access to capital in the secured and unsecured debt and private equity markets, and one of the highest quality portfolios of premier workplaces in the

assembled over several decades of intentional development, acquisitions, and dispositions.

Today, clients and their advisors are more focused than ever on these attributes for their building owners, which distinguishes BXP among its competitors.

This strategy is more valuable than ever as our clients are interested in premier workplaces in vibrant, amenitized, accessible and high demand workplaces to encourage more in-person work.

This interest has resulted in the acceleration of flight to quality in the office industry.

Over the past several years, BXP’s experience and performance has diverged from the larger market and media sentiment, as premier workplaces have outperformed the broader office market consistently and substantially.

We believe this divergence validates our strategy and differentiates BXP from other office companies.

Although overall leasing demand has still not returned to pre-pandemic levels, premier workplaces in our five traditional central business district (“CBD”) markets (Boston, New York, San Francisco, Seattle, and Washington, DC) have consistently outperformed the broader office market in those CBDs since the first quarter of 2021 on several key metrics, including occupancy, net absorption levels and rental rates.

This outperformance is evident in BXP’s portfolio where approximately 89% of our share of net operating income (“NOI”) comes from assets located in CBDs that are predominantly premier workplaces.

These CBD assets are 91.0% occupied and 92.8% leased (including vacant space for which we have signed leases that have not yet commenced in accordance with generally accepted accounting principles (“GAAP”)) as of the end of the first quarter of 2024.

For a detailed discussion of our share of NOI, including the reasons management believes the metric is useful to investors and a reconciliation to the most comparable GAAP measure, see page 31 .

As of March 31, 2024, the weighted-average remaining lease term (1) for our in-place leases, based on square feet, including those signed by our unconsolidated joint ventures but excluding residential units, was approximately 7.6 years, and (2) for our 20 largest clients, based on square feet, was approximately 10.4 years.

To be successful in any leasing environment, we believe we must consider all aspects of the client-landlord relationship.

3 unchanged sentences

• our reputation as a high-quality developer, owner and manager of premier workplaces in our markets;

• our financial strength and our ability to maintain high building standards;

• our financial strength, including our ability to fund our share of lease obligations and maintain premier building standards;

• our relationships with local brokers.

Despite the Federal Reserve having increased the discount rate to 5.25% and the 10-year U.S.

Treasury having risen nearly 3% since March 2022, the U.S.

economy’s headline statistics remain stable with GDP growth at 4.9% in the third quarter, 150,000 jobs created in October, and the unemployment rate slightly increased to 3.9%.

However, this economic picture may not accurately reflect the market tone and operating environment for many of our clients.

Assuming forecasts for negative earnings growth in the third quarter are accurate, the S&P 500 annual earnings growth has been negative for the last four quarters.

We believe much of the recent strength in the GDP has been consumption related, and job creation has been in the leisure and hospitality, healthcare, education, and government sectors;

not the office using sectors, such as information and financial services.

Our clients are corporations that actively manage their headcount and operating expenses in times of weak or negative earnings growth.

As a result, they are taking more time to make leasing decisions, leasing less space, offering space they have for sublease or taking a combination of one or more of the foregoing actions.

This has contributed to the slower leasing volume in 2023 compared to last year.

Although remote work continues to be a factor, we believe economic conditions are the primary driver of our slower leasing activity in 2023, and we expect leasing activity will rebound when earnings growth returns.

We believe the sentiment surrounding return-to-office and the effects on office buildings is worse than the reality of what BXP is experiencing.

We continue to be encouraged with the return-to-office trajectory we are experiencing in our buildings as well as the commentary and actions of many of our clients with respect to their in-person work policies.

Several large companies have notified their employees that their attendance in office will be included in performance reviews and that employees who already have received approval for remote work may now have that status reevaluated.

A primary tool used by companies to increase attendance is to provide modern workspaces with amenities in an easily commutable location, the definition of a premier workplace.

As a result, the premier workplace segment, which we operate in, continues to outperform the broader office market, in both vacancy and net absorption, as companies see an opportunity to upgrade their workplaces as a method of attracting their workforces back to the office and recruiting new employees.

Throughout our portfolio, there has been a slow but steady increase in the number of unique occupants that are in our offices each month.

As of mid-October 2023, building-census data (based on turnstile information available for approximately half of our portfolio) and space utilization data indicate that our clients are indeed using their spaces at least multiple days a week (primarily Tuesday through Thursday).

We believe this data, coupled with continued efforts from employers to implement mandatory in-office policies, makes it challenging for clients to reduce space.

Two of the most significant external forces impacting BXP’s performance are interest rates and corporate earnings.

We believe lower interest rates would improve our cost of capital, spark more transaction activity and investment opportunities in our sector, reduce the cost of new development and be a tailwind for our client’s earnings growth.

Greater corporate earning would, in turn, likely encourage our clients to increase their office space requirements.

However, with inflation increasing at greater than expected rates, the Federal Reserve has stated that it expects to delay interest rate cuts.

Our clients generally do not hire new employees and increase their office space requirements unless their earnings are growing or they are in need of additional employees to grow their earnings.

From 2011 to present, S&P 500 earnings grew around 12% per year, but in 2023 the growth rate was 0% and in 2022 it was 5%.

Though the U.S.

economy is growing, and unemployment remains low, only approximately 7% of the jobs created in the first quarter of 2024 were in office using categories compared to the long-term average of over 25%.

Growth in S&P 500 earnings are projected to be 11% to 13% per annum over the next two years, which should be constructive to BXP’s leasing activity.

Many technology clients, a critically important sector that drove space demand following the Great Financial Crisis, overcommitted to space during the pandemic which has exacerbated the supply-demand imbalance.

Over the longer term, we expect earnings at technology companies will grow and they will begin to absorb the available supply.

Although remote work continues to be a factor restraining demand for office space, we believe economic conditions are the primary driver of leasing activity.

As overall earnings growth for our clients and potential clients improves, it should lead to employment growth and demand for office space over time.

However, we are not counting on a near-term market recovery to maintain BXP’s occupancy.

Our leasing, construction and property management teams will lean on our operating prowess to gain new clients and market share as clients choose premier workplaces that are in sound financial condition for their office space.

The evolving operating environment impacts various aspects of our operating activities as:

• labor market conditions shift, resulting in increasing employer demands for mandatory in-person workdays;

• volatility in the capital markets, have driven companies to be more reticent in capital outlays, including capital required for leasing new space;

• labor market conditions shift, which has gradually increased employer demand for mandatory in-person workdays;

• volatility in the capital markets has led companies to be more reticent in their capital outlays, including capital required for leasing new space;

• our capital costs have increased due to higher interest rates and credit spreads, and private market debt financing, both for construction and existing assets, is significantly more challenging to arrange;

• construction costs have increased and, although most of the cost for our active development pipeline is fixed, the cost of potential future construction activity continues to increase.

In light of the foregoing, we believe we continue to position BXP for success, notwithstanding the uncertain trajectory of the U.S.

and global economies, by increasing liquidity, managing our leverage, pursuing additional capital raising opportunities and maintaining discipline in discretionary capital expenditures, while continuing to selectively invest (including through both acquisitions and developments) in premier workplace opportunities.

• construction costs have increased and, although much of the cost for our active development pipeline is fixed, the cost of potential future construction activity continues to increase.

In light of the uncertain trajectory of the U.S.

and global economies, we believe we continue to position BXP for success by increasing liquidity, managing our leverage, pursuing additional capital raising opportunities and maintaining discipline in discretionary capital expenditures, while continuing to selectively invest (including through both acquisitions and developments) in premier workplace opportunities.

We remain focused on the following strategies:

• continuing to embrace our leadership position in the premier workplace segment and leveraging our strength in portfolio quality, client relationships, development skills, market penetration and sustainability to profitably build market share;

Premier workplaces, the preferred choice for our current and prospective clients, are gaining market share compared to general office space and continue to demonstrate the highest occupancy, net absorption levels and rental rates in the central business districts (“CBDs”) in markets where we operate;

• leasing available space in our in-service and development properties, as well as proactively focusing on future lease expirations;

1 unchanged sentence

• pursuing attractive asset class adjacencies where we have a track record of success, such as life sciences and residential development;

• continuing to raise the bar in the quality of our portfolio and actively recycling capital by selling assets, subject to market conditions, which have been, and may continue to be, negatively impacted by a slowdown in the capital markets and the limited availability of private market debt financing;

• continuing to raise the bar in the quality of our portfolio and actively recycling capital by selling assets, subject to market conditions, which have been, and may continue to be, negatively impacted by a slowdown in the capital markets, elevated interest rates, and the limited availability of private market debt financing;

• actively managing our operations in a sustainable and responsible manner;

• prioritizing risk management by actively managing liquidity, investing more extensively with joint venture partners to manage our debt levels, and being highly selective in new investment commitments.

The following is an overview of leasing and investment activity in the third quarter of 2023 and recent business highlights.

The following is an overview of leasing and investment activity in the first quarter of 2024 and recent business highlights.

Leasing Activity and Occupancy

In the third quarter of 2023, we signed a total of approximately 1.06 million square feet of leases with a weighted-average lease term of approximately 8.2 years.

This is the second consecutive quarter that leasing has increased, underscoring the demand for premier workplaces, despite the challenging market.

The overall occupancy of our in-service premier workplace and retail properties was 88.8% at September 30, 2023, an increase of 50 basis points from June 30, 2023.

We define occupancy as space with signed leases for which revenue recognition has commenced in accordance with GAAP.

Including vacant space for which we have signed leases that have not yet commenced in accordance with GAAP, our in-service premier workplace and retail properties were approximately 90.4% leased at September 30, 2023.

The macroeconomic environment has resulted in softening demand in all of our markets.

1 unchanged sentence

Potential clients touring space acknowledge that economic uncertainty is impacting space decisions.

We have factored in the impacts of a slower economy, softer business performance, and reduced demand for space into our leasing expectations for the remainder of 2023.

We expect the bulk of our leasing in the last quarter of 2023 will continue to come from small- and medium-sized professional and financial services firms.

Also impacting clients decisions are the building quality as well as the financial stability and long-term commitment of their building owners, both strong competitive advantages for BXP.

In the first quarter of 2024, we executed 61 leases totaling approximately 900,000 square feet with a weighted-average lease term of approximately 11.6 years, compared to approximately 660,500 square feet of leases executed in the first quarter of 2023 with a weighted-average lease term of approximately 7.7 years.

BXP’s CBD portfolio of premier workplaces was 91.0% occupied and 92.8% leased (including vacant space for which we have signed leases that have not yet commenced in accordance with GAAP) at March 31, 2024.

Approximately 89% of our share of NOI comes from assets located in our CBD portfolio, underscoring the strength of BXP’s strategy to invest in the highest quality buildings in dynamic urban gateway markets.

For a detailed discussion of our share of NOI, including the reasons management believes the metric is useful to investors and a reconciliation to the most comparable GAAP measure, see page 31 .

The overall occupancy of our in-service office and retail properties was 88.2% at March 31, 2024, a decrease of 20 basis points from December 31, 2023.

We define occupancy as space with signed leases for which revenue recognition has commenced in accordance with GAAP.

Including vacant space for which we have signed leases that have not yet commenced revenue recognition in accordance with GAAP, our in-service office and retail properties were approximately 89.9% leased at March 31, 2024.

Investment Activity

We continually evaluate current and prospective markets for possible acquisitions of “value-add” assets that require lease-up or repositioning, and acquisitions that are otherwise consistent with our long-term strategy of owning, managing, developing, and improving premier workplaces in each of our chosen markets.

We expect opportunities to make acquisitions will increase in this environment, and we remain committed to developing and acquiring assets to enhance our long-term growth and to meet current and future client demand for premier workplaces, life sciences, and residential development.

Consistent with this strategy, we entered into a joint venture agreement with an institutional investor for the future development of 343 Madison Avenue located on Madison Avenue between 44th and 45th Streets in New York City, New York adjacent to Grand Central Station.

We own a 55% interest in the venture and our partner owns a 45% interest, and we will provide customary development, property management, and leasing services.

The 343 Madison Avenue project contemplates the construction of (1) a direct entrance to the Long Island Railroad’s new east side access project (Grand Central Madison) (“Phase 1”) and (2) an approximately 900,000 square foot premier workplace building with ground floor retail (“Phase 2”).

The joint venture executed an up to 99-year ground lease with the Metropolitan Transportation Authority for the approximately 25,000 square foot site.

The ground lease requires the joint venture to construct Phase 1 of the development project.

The joint venture has the option until July 31, 2025 to terminate the ground lease prior to construction of the new building and receive reimbursement of up to $117.0 million for the cost of the construction of Phase 1.

There can be no assurance that Phase 1 will be completed on the terms currently contemplated or that Phase 2 of the development project will commence on the terms and schedule currently contemplated or at all.

A joint venture in which we owned a 20% equity interest (with an institutional investor owning the remaining 80%) completed a restructuring of the ownership in Metropolitan Square, which resulted in (i) an affiliate of the existing mezzanine lender purchasing the property, and (ii) us becoming a co-lender of up to $20.0 million under a new $100.0 million mezzanine loan.

The transaction also resulted in, among other things, (i) the cessation of our obligation to fund future investments through our then 20% equity interest, which caused us to recognize a third quarter gain on investment of approximately $35.8 million related to our deficit investment balance, and (ii) the removal of the property from our in-service portfolio.

Prior to the restructuring, the property was encumbered by an aggregate of $420.0 million of debt, consisting of a senior loan with an outstanding principal balance of $305.0 million senior loan and the existing $115.0 million mezzanine loan.

The new mezzanine loan, which is subordinate only to the senior loan, may be drawn upon for future lease-up, operating and other costs on an as needed basis, and amounts borrowed will bear interest at a per annum rate of 12%, compounded monthly.

In addition, we will continue to provide property management and leasing services to the property with the potential to earn additional incentive fees.

Metropolitan Square is an approximately 657,000 square foot premier workplace located at 655 15th Street, NW in the heart of downtown Washington, DC.

As of September 30, 2023, our development/redevelopment pipeline consisted of 11 properties that, when completed, we expect will total approximately 2.8 million net rentable square feet.

We remain in active pursuit of opportunities in our core markets and asset types with primarily two types of counterparties:

lenders to highly leveraged assets that require recapitalization and institutional owners seeking to diversify from the office asset class.

To date, there has been limited market transaction activity for higher-quality office assets.

With lenders, there are fewer premier workplaces that are struggling with leverage, and in the few cases involving premier workplaces, lenders are generally electing to extend loans to borrowers who agree to invest modestly in their assets.

Institutional owners are less interested in selling their higher quality assets, and there remains a material bid-ask spread given assets have in most cases not been marked down to market clearing levels.

Notwithstanding these current challenges, our expectations are that transactions and our investment activity will increase in coming quarters given the volume of maturing financings, continued mark downs in institutional portfolios and prolonged high interest rates.

We also have interest from institutional investors in co-investing with us for select opportunities.

Consistent with this strategy, on January 8, 2024, we completed the acquisition of our joint venture partner’s 50% economic ownership interest in the joint venture that owns 901 New York Avenue located in Washington, DC for a purchase price of $10.0 million and recorded a gain on consolidation of approximately $21.8 million.

This transaction was sparked by our partner’s election to reduce their exposure to the office sector, and we agreed to purchase their interest on attractive terms.

The property is encumbered by an approximately $207.1 million mortgage debt, at acquisition, which bears interest at 3.61% per annum and matures on January 5, 2025.

Following the acquisition, we modified the mortgage loan to provide for two loan extension options totaling five years of additional term, each subject to certain conditions.

The first loan extension option is for four years at a fixed interest rate of 5.0% per annum.

We also extended an approximately 200,000 square foot lease with the anchor client through 2042 after the acquisition.

901 New York Avenue is a premier workplace consisting of approximately 524,000 net rentable square feet.

Also, on March 21, 2024, we completed the previously announced sale of a 45% interest in 290 Binney Street, a life sciences development located in Kendall Square in Cambridge, Massachusetts, to an institutional investor.

The institutional investor’s investment in 290 Binney Street will reduce our share of the project’s estimated development spend over time by approximately $533.5 million, including $141.8 million that was funded at closing.

The consummation of this joint venture completed the institutional investor’s two-building investment in Cambridge, Massachusetts with a gross valuation of approximately $1.66 billion or $2,050 per square foot.

The properties, 290 Binney Street and 300 Binney Street, total 802,000 net rentable square feet and are 100% pre-leased.

We retain a 55% interest in each joint venture and provide development, property management, and leasing services for the ventures.

As of March 31, 2024, our development/redevelopment pipeline consisted of 11 properties that, when completed, we expect will total approximately 3.2 million net rentable square feet.

Our share of the estimated total cost for these projects is approximately $2.6 billion, of which approximately $1.4 billion remains to be invested.

The commercial space in the pipeline, which excludes Skymark (formerly Reston Next Residential), is 52% pre-leased as of October 30, 2023.

In the third quarter of 2023, we completed and fully placed in-service two development projects:

• 140 Kendrick Street - Building A, an approximately 104,000 square foot property in Needham, Massachusetts.

140 Kendrick is the first Net Zero, Carbon Neutral office repositioning of its scale in Massachusetts.

The property is 100% leased.

• 751 Gateway, an approximately 231,000 square foot laboratory/life sciences property in South San Francisco, California in which BXP has a 49% interest.

The property is 100% leased.

The commercial space in the pipeline, which excludes the residential projects, was 54% pre-leased as of May 2, 2024.

As we continue to focus on new investments to drive future growth, we regularly review our portfolio to identify properties as potential sales candidates that either no longer fit within our portfolio strategy or could attract premium pricing in the current market.

However, the asset sale market for all real estate asset classes has slowed dramatically with the increase in interest rates and transaction volume for office assets continues to be minimal in the U.S.

However, the asset sale market for all real estate asset classes has slowed dramatically while interest rates remain elevated and transaction volume for office assets continues to be minimal in the U.S.

A brief overview of each of our markets follows.

During the third quarter of 2023, we executed approximately 440,000 square feet of leases and approximately 365,000 square feet of leases commenced in the Boston region.

Approximately 140,000 square feet of the leases that commenced had been vacant for less than one year and represent an increase in net rental obligations of approximately 14% over the prior leases.

As of September 30, 2023, our Boston CBD in-service portfolio was approximately 95.6% occupied and approximately 96.4% leased (including vacant space for which we have signed leases that have not yet commenced in accordance with GAAP).

Our approximately 2.5 million square foot in-service premier workplace portfolio in Cambridge was approximately 97.2% occupied and leased (including vacant space for which we have signed leases that have not yet commenced in accordance with GAAP) as of September 30, 2023.

As of September 30, 2023, our Route 128-Mass Turnpike in-service portfolio is comprised of approximately 4.9 million square feet and was approximately 79.2% occupied and approximately 80.2% leased (including vacant space for which we have signed leases that have not yet commenced in accordance with GAAP).

Our Los Angeles (“LA”) in-service portfolio of approximately 2.3 million square feet is currently focused in West LA and includes Colorado Center, an approximately 1.1 million square foot property of which we own 50%, and Santa Monica Business Park, a 21-building, approximately 1.2 million square foot property of which we own 55%.

As of September 30, 2023, our LA in-service properties were approximately 85.9% occupied and 87.6% leased (including vacant space for which we have signed leases that have not yet commenced in accordance with GAAP).

During the third quarter of 2023, we executed approximately 100,000 square feet of leases and approximately 70,000 square feet of leases commenced in the Los Angeles region.

During the first quarter of 2024, we executed approximately 178,000 square feet of leases and approximately 435,000 square feet of leases commenced in the Boston region.

Approximately 374,000 square feet of the leases that commenced had been vacant for less than one year and represent an increase in net rental obligations of approximately 21.4% over the prior leases.

During the third quarter of 2023, we executed approximately 240,000 square feet of leases in the New York region and approximately 374,000 square feet of leases commenced.

Approximately 180,000 square feet of the leases that commenced had been vacant for less than one year and they represent a decrease in net rental obligations of approximately 11% over the prior leases.

As of September 30, 2023, our New York CBD in-service portfolio was approximately 92.1% occupied and approximately 92.8% leased (including vacant space for which we have signed leases that have not yet commenced in accordance with GAAP).

As of March 31, 2024, our approximately 8.3 million square foot Boston CBD in-service portfolio was approximately 94.7% occupied and approximately 95.9% leased (including vacant space for which we have signed leases that have not yet commenced in accordance with GAAP).

Our approximately 2.5 million square foot in-service premier workplace CBD portfolio in Cambridge was approximately 97.4% occupied and leased (including vacant space for which we have signed leases that have not yet commenced in accordance with GAAP) as of March 31, 2024.

As of March 31, 2024, our Route 128-Mass Turnpike in-service portfolio is comprised of approximately 4.7 million square feet and was approximately 79.3% occupied and approximately 79.4% leased (including vacant space for which we have signed leases that have not yet commenced in accordance with GAAP).

As of March 31, 2024, our LA in-service properties were approximately 86.1% occupied and 87.2% leased (including vacant space for which we have signed leases that have not yet commenced in accordance with GAAP).

During the first quarter of 2024, we executed approximately 225,000 square feet of leases in the New York region and approximately 313,000 square feet of leases commenced.

Approximately 269,000 square feet of the leases that commenced had been vacant for less than one year and they represent an increase in net rental obligations of approximately 10.5% over the prior leases.

As of March 31, 2024, our New York CBD in-service portfolio was approximately 91.5% occupied and approximately 95% leased (including vacant space for which we have signed leases that have not yet commenced in accordance with GAAP).

San Francisco

During the third quarter of 2023, we executed approximately 52,000 square feet of leases and approximately 406,000 square feet of leases commenced in the San Francisco region.

Approximately 127,000 square feet of leases that commenced had been vacant for less than one year and represent a decrease in net rental obligations of approximately 2% over the prior leases.

As of September 30, 2023, our San Francisco CBD in-service properties were approximately 89.3% occupied and approximately 90.3% leased (including vacant space for which we have signed leases that have not yet commenced in accordance with GAAP).

Client demand in the San Francisco CBD had increased more than 50% since the fourth quarter of 2022 with new technology demand responsible for much of the increase.

Growth from the artificial intelligence (“AI”) organizations in San Francisco is particularly noteworthy with billions of dollars of recent investment into this growing ecosystem and a number of these AI companies actively considering space.

Given the potential and recent growth of these organizations, we would expect this demand to center on the well-built technology sublet space that is readily available in the San Francisco market.

San Francisco is the leading labor market for AI jobs followed by New York and Seattle.

New venture capital investment in AI is concentrated in San Francisco, New York and Boston according to CBRE Insights, with San Francisco receiving the majority of the investment.

These are encouraging facts that could be constructive to the recovery of the San Francisco office market, if they come to fruition.

During the first quarter of 2024, we executed approximately 109,000 square feet of leases and approximately 175,000 square feet of leases commenced in the San Francisco region.

Approximately 98,000 square feet of leases that commenced had been vacant for less than one year and represent an increase in net rental obligations of approximately 10.0% over the prior leases.

As of March 31, 2024, our San Francisco CBD in-service properties were approximately 86.6% occupied and approximately 87.4% leased (including vacant space for which we have signed leases that have not yet commenced in accordance with GAAP).

Our Seattle in-service portfolio includes Safeco Plaza, an approximately 769,000 square foot property of which we own 33.67%, and Madison Centre, an approximately 755,000 square foot property.

As of September 30, 2023, our Seattle in-service properties were approximately 84.7% occupied and approximately 87.6% leased (inclusive of vacant space with signed leases that have not yet commenced in accordance with GAAP).

During the third quarter of 2023, we executed approximately 127,000 square feet of leases in the Seattle region.

As of March 31, 2024, these in-service properties were approximately 81.8% occupied and approximately 83.1% leased (inclusive of vacant space with signed leases that have not yet commenced in accordance with GAAP).

Washington, DC

During the third quarter of 2023, we executed approximately 100,000 square feet of leases and approximately 350,000 square feet of leases commenced in the Washington, DC region.

During the first quarter of 2024, we executed approximately 336,000 square feet of leases and approximately 438,000 square feet of leases commenced in the Washington, DC region.

Approximately 256,000 square feet of the leases that commenced had been vacant for less than one year and represent a decrease in net rental obligations of approximately 4.7% over the prior leases.

As of September 30, 2023, our Washington, DC CBD in-service properties were approximately 83.8% occupied and approximately 89.1% leased (inclusive of vacant space with signed leases that have not yet commenced in accordance with GAAP).

As of March 31, 2024, our Washington, DC CBD in-service properties were approximately 86.7% occupied and approximately 88.9% leased (inclusive of vacant space with signed leases that have not yet commenced in accordance with GAAP).

A significant component of our Washington, DC regional portfolio is in Reston Town Center, an award-winning mixed-use development in Northern Virginia.

Reston is a hub for technology, cloud services, cybersecurity and defense intelligence companies.

As of September 30, 2023, our Reston, Virginia properties were approximately 88.6% occupied and approximately 94.0% leased (inclusive of vacant space with signed leases that have not yet commenced in accordance with GAAP).

As of March 31, 2024, our Reston CBD portfolio was approximately 93.7% occupied and approximately 95.6% leased (inclusive of vacant space with signed leases that have not yet commenced in accordance with GAAP).

Leasing Statistics

The table below details the leasing activity, including 100% of the unconsolidated joint ventures, that commenced during the three and nine months ended September 30, 2023:

Three months ended September 30, 2023 Nine months ended September 30, 2023

The table below details the leasing activity, including 100% of the unconsolidated joint ventures, that commenced revenue recognition during the three months ended March 31, 2024:

Three months ended March 31, 2024

(Square Feet)

Vacant space available at the beginning of the period 5,696,007

Property dispositions/properties taken out of service (1) (289,204) (622,481)

Properties placed (and partially placed) in-service (2) 334,758 516,355

Vacant space from property dispositions/properties taken out of service (1) (233,694)

Vacant space from properties placed (and partially placed) in-service (2) 44,652

Leases expiring or terminated during the period 1,684,796

1 unchanged sentence

1 st generation leases

380,519 531,606

2 nd generation leases with new clients

632,026 1,620,339

2 nd generation lease renewals

552,423 1,230,902

Total space leased (3) 1,433,155

Vacant space available for lease at the end of the period 5,758,606

Leases executed during the period, in square feet (4) 1,055,781 2,653,797

Leases executed during the period (4) 893,941

Second generation leasing information :

Leases commencing during the period, in square feet 1,261,164

Weighted Average Lease Term 81 Months 86 Months

Weighted Average Free Rent Period 190 Days 185 Days

Weighted Average Lease Term 110 Months

Weighted Average Free Rent Period 93 Days

Total Transaction Costs Per Square Foot (6) $79.32

Increase (Decrease) in Gross Rents (7) (3.34) % 0.58 %

Increase (Decrease) in Net Rents (8) (5.61) % 0.59 %

Increase in Gross Rents (7) 6.78 %

Increase in Net Rents (8) 9.62 %

__________________

(1) Total vacant square feet of properties taken out of service during the three months ended September 30, 2023 consists of 289,204 square feet at Metropolitan Square (See Notes 5 and 14 to the Consolidated Financial

Total vacant square feet of properties taken out of service during the nine months ended September 30, 2023 consists of 289,204 square feet at Metropolitan Square, 195,191 square feet at 300 Binney Street, 55,852 square feet at 420 Bedford Street, 57,045 square feet at 430 Bedford Street and 25,189 square feet at 2098 Gaither Road.

(2) Total vacant square feet of properties placed in service during the three months ended September 30, 2023 consists of 230,592 square feet at 751 Gateway and 104,166 square feet at 140 Kendrick Street - Building A.

Total vacant square feet of properties placed in service during the nine months ended September 30, 2023 consists of 230,592 square feet at 751 Gateway, 104,166 square feet at 140 Kendrick Street - Building A, and 181,597 square feet at 2100 Pennsylvania Avenue.

(3) Represents leases for which lease revenue recognition has commenced in accordance with GAAP during the three and nine months ended September 30, 2023 .

(4) Represents leases executed during the three and nine months ended September 30, 2023 for which we either (1) commenced lease revenue recognition in such period or (2) will commence lease revenue recognition in subsequent periods, in accordance with GAAP, and includes leases at properties currently under development.

The total square feet of leases e xecuted and recognized during the three and nine months ended September 30, 2023 are 189,541 and 492,669 square feet, respectively.

(1) Total vacant square feet of properties taken out of service during the three months ended March 31, 2024 consists of 162,274 square feet at 1050 Winter Street and 71,420 square feet at 15825 Shady Grove Road.

(2) Total vacant square feet of properties placed (and partially placed) in-service during the three months ended March 31, 2024 consists of 44,652 square feet at 651 Gateway.

(3) Represents leases for which lease revenue recognition has commenced in accordance with GAAP during the three months ended March 31, 2024 .

(4) Represents leases executed during the three months ended March 31, 2024 for which we either (1) commenced lease revenue recognition in such period or (2) will commence lease revenue recognition in subsequent periods, in accordance with GAAP, and includes leases at properties currently under development.

The total square feet of leases e xecuted and recognized during the three months ended March 31, 2024 is 354,567 square feet.

(5) Second generation leases are defined as leases for space that we have previously leased.

Of the 1,184,449 and 2,851,241 square feet of second generation leases that commenced during the three and nine months ended September 30, 2023, respectively, leases for 1,024,020 and 2,389,495 square feet, respectively, were signed in prior periods.

Of the 1,261,164 square feet of second generation leases that commenced during the three months ended March 31, 2024, leases for 906,597 square feet were signed in prior periods.

(6) Total transaction costs include tenant improvements and leasing commissions but exclude free rent concessions and other inducements in accordance with GAAP.

(7) Represents the increase (decrease) in gross rent (base rent plus expense reimbursements) on the new versus expired leases on the 789,077 and 1,849,017 square feet of second generation leases that had been occupied within the prior 12 months for the three and nine months ended September 30, 2023, respectively;

(7) Represents the increase in gross rent (base rent plus expense reimbursements) on the new versus expired leases on the 1,053,391 square feet of second generation leases that had been occupied within the prior 12 months for the three months ended March 31, 2024;

excludes leases that management considers temporary because the client is not expected to occupy the space on a long-term basis.

(8) Represents the increase (decrease) in net rent (gross rent less operating expenses) on the new versus expired leases on the 789,077 and 1,849,017 square feet of second generation leases that had been occupied within the prior 12 months for the three and nine months ended September 30, 2023, respectively.

Transactions during the three months ended September 30, 2023 included the following:

Development/Redevelopment activities

• On July 20, 2023, we completed and fully placed in-service 140 Kendrick Street - Building A, a premier workplace redevelopment project with approximately 104,000 net rentable square feet located in Needham, Massachusetts.

The property is the first Net Zero, Carbon Neutral office repositioning of its scale in Massachusetts.

• On September 26, 2023, we partially placed in-service 180 CityPoint, an approximately 329,000 net rentable square feet laboratory/life sciences project located in Waltham, Massachusetts.

Ground Lease activity

• On August 1, 2023, a consolidated joint venture in which we have a 55% interest executed an up to 99-year ground lease with the Metropolitan Transportation Authority for an approximately 25,000 square foot site, the 343 Madison Avenue project in New York City (see Notes 4 and 9 to the Consolidated Financial Statements).

We are reasonably certain that we will not exercise this termination option as we completed a long-term competitive process to obtain the right to ground lease this site.

There is no rent due under the ground lease for the period from August 1, 2023 through July 31, 2028, with the exception of a payment of approximately $21.8 million that is due on July 31, 2025.

Beginning August 1, 2028, the lease requires rent of approximately $10.9 million per year with adjustments every five years, with a minimum increase of 110% of the ground rent from the prior year.

The lease required the joint venture to pay a non-refundable deposit totaling $25.0 million.

be no assurance that Phase 1 will be completed on the terms currently contemplated or that Phase 2 of the development project will commence on the terms and schedule currently contemplated or at all.

(8) Represents the increase in net rent (gross rent less operating expenses) on the new versus expired leases on the 1,053,391 square feet of second generation leases that had been occupied within the prior 12 months for the three months ended March 31, 2024.

Transactions during the three months ended March 31, 2024 included the following:

Acquisition activity

• On January 8, 2024, we completed the acquisition of our joint venture partner’s 50% economic ownership interest in the joint venture that owns 901 New York Avenue, located in Washington, DC.

At acquisition, the total net equity acquired was $20.0 million, which includes $10.0 million in cash that we paid for the joint venture partner's 50% economic ownership interest in the joint venture.

The property is subject to existing mortgage indebtedness of approximately $207.1 million (See Debt activit ies below).

The acquisition resulted in us recording a gain upon consolidation of approximately $21.8 million, which is the difference between the fair value of the previously held equity method investment immediately prior to the consolidation of $10.0 million, less our costs basis of approximately $(11.8) million.

The gain on consolidation is included within income (loss) from unconsolidated joint ventures in the Consolidated Statement of Operations.

901 New York Avenue is a premier workplace consisting of approximately 524,000 net rentable square feet.

Development activity

• On February 12, 2024, we commenced the development of a residential project at 121 Broadway Street in Cambridge, Massachusetts that is adjacent to our development projects at 290 Binney Street and 300 Binney Street.

121 Broadway will consist of 439 residential units aggregating approximately 492,000 net rentable square feet.

Impairment activity

• At March 31, 2024, we evaluated the expected hold period for a portion of our Shady Grove property located in Rockville, Maryland.

Based on a shorter-than-expected hold period, we reduced the carrying value of a portion of the property that we anticipate selling to a third party developer to its estimated fair value at March 31, 2024.

As a result, each of BXP and BPLP recognized an impairment loss of approximately $13.6 million.

Our estimated fair value was based on Level 3 inputs as defined in Accounting Standards Codification (“ASC”) 820 “Fair Value Measurements and Disclosures” (“ASC 820”) and on a pending offer from a third party.

Lease activity

• On March 28, 2024, we entered into a 90-year air rights lease with the Massachusetts Department of Transportation for an approximately 61,000 square feet site at the parking garage located at 100 Clarendon Street and the concourse level of the Massachusetts Bay Transportation Authority’s Back Bay Station (the “Station”).

The lease requires annual base rental payments of $250,000 until the commencement of construction, as defined in the lease.

If we commence construction of a project on the site on or before August 1, 2028 then a final fixed rental payment is due in accordance with the lease at that time.

After August 1, 2028, if we commence construction of a project on the site, then a final rental payment based on the then current fair market value will be due at that time.

In addition, the lease requires annual payments of $500,000 through 2033 to fund maintenance and improvements to the Station.

We have assumed that we will begin construction on the site on or before August 1, 2028.

The incremental borrowing rate for this lease is 6.57% per annum.

The net present value of the ground lease payments is approximately $23.2 million.

We classify this lease as an operating lease.

As a result, we recorded a Right of Use Assets – Operating Leases and Lease Liabilities – Operating Leases of approximately $23.9 million and $23.2 million, respectively, on our Consolidated Balance Sheets as of March 31, 2024.

There were no lease costs for the period from March 28, 2024 through March 31, 2024.

Unconsolidated joint venture activities

• On July 28, 2023, a joint venture in which we have a 50% interest modified and exercised an option to extend by one year the maturity date of its loan collateralized by 100 Causeway Street.

At the time of the modification and extension, the loan had an outstanding balance totaling approximately $340.6 million, bore interest at Term SOFR plus 1.60% per annum, and was scheduled to mature on September 5, 2023.

Following the modification and extension, the loan had an outstanding balance of $336.6 million, which included an approximately $4.0 million principal repayment, bears interest at Term SOFR plus 1.48% per annum, and matures on September 5, 2024, with an additional one-year extension option, subject to certain conditions.

100 Causeway Street is an approximately 634,000 square foot premier workplace located in Boston, Massachusetts and is approximately 95% leased.

• On August 11, 2023, a joint venture in which we have a 25% interest exercised its second extension option of 180-days collateralized by 3 Hudson Boulevard.

The extended loan now matures on February 9, 2024.

As of September 30, 2023, the loan had approximately $25.6 million of accrued interest due at the maturity date.

• On January 2, 2024, a joint venture in which we have a 50% interest partially placed in-service 651 Gateway, an approximately 327,000 net rentable square foot laboratory/life sciences project in South San Francisco, California.

The property is approximately 21% pre-leased as of May 2, 2024.

• On January 8, 2024, we acquired our joint venture partner’s 50% economic ownership interest in the joint venture that owns 901 New York Avenue, located in Washington, DC, for a gross purchase price of $10.0 million in cash (See Acquisition activity above).

Prior to the acquisition, we had a 50% economic ownership interest in the joint venture and accounted for it under the equity method of accounting.

The acquisition resulted in us having full ownership of the joint venture such that we now account for the assets, liabilities, and operations of it on a consolidated basis in our financial statements instead of under the equity method of accounting and as a result recognized a gain on consolidation of approximately $21.8 million.

• On February 6, 2024, a joint venture in which we own a 25% interest extended the maturity date of the loan collateralized by its 3 Hudson Boulevard property.

The extended loan continues to bear interest at a variable rate equal to Term SOFR plus approximately 3.61% per annum and matures on May 9, 2024.

At the time of the extension, the loan had an outstanding balance totaling $80.0 million and was scheduled to mature on February 9, 2024.

3 Hudson Boulevard consists of land and improvements held for future development located in New York, New York.

• On September 1, 2023, a joint venture in which we have a 49% interest completed and fully placed in-service 751 Gateway, an approximately 231,000 square foot laboratory/life sciences project in South San Francisco, California.

The property is 100% leased.

• On September 6, 2023, a joint venture in which we have a 50% interest modified the loan collateralized by its Hub on Causeway - Podium property.

At the time of the modification, the loan had an outstanding balance of approximately $174.3 million, bore interest at Term SOFR plus 2.35% per annum, and was scheduled to mature on September 6, 2023.

Following the modification, the modified loan had an outstanding balance of $154.3 million, which included an approximately $20.0 million principal repayment, bears interest at Daily SOFR plus 2.50% per annum, and matures on September 8, 2025, with a one-year extension option, subject to certain conditions.

On September 8, 2023, the joint venture entered into interest rate swap contracts with notional amounts aggregating approximately $154.3 million through September 2, 2025, resulting in a fixed interest rate of approximately 7.35% per annum through the expiration of the interest rate swap contracts.

The Hub on Causeway - Podium is an approximately 383,000 square foot premier workplace located in Boston, Massachusetts and is approximately 94% leased.

• On September 13, 2023, a joint venture in which we owned a 20% equity interest completed the first step of a two-step restructuring of its ownership in Metropolitan Square.

The two-step restructuring will result in (i) an affiliate of the existing mezzanine lender purchasing the property and becoming the new property owner and us no longer having an equity interest in the property and (ii) us becoming a co-lender of up to $20.0 million under a new $100.0 million mezzanine loan (“New Mezz Loan”).

Prior to the restructuring, the property was encumbered by an aggregate of $420.0 million of debt, consisting of a senior loan with an outstanding principal balance of $305.0 million (“Senior Loan”) and the existing $115.0 million mezzanine loan (“Existing Mezz Loan”).

Step one of the restructuring was completed on September 13, 2023, and resulted in, among other things, (i) the cessation of our obligation to fund future investments through our then 20% equity interest, which caused us to recognize a gain on investment of approximately $35.8 million related to our deficit investment balance, which was primarily due to excess distributions, and (ii) the removal of the property from our in-service portfolio.

Metropolitan Square is an approximately 657,000 net rentable square foot premier workplace located at 655 15th Street, NW in the heart of downtown Washington, DC.

See Note 14 to the Consolidated Financial Statements for a description of step two of the restructuring.

• During the three months ended September 30, 2023, we recognized an other-than-temporary impairment loss on our investments in Platform 16, 360 Park Avenue South, 200 Fifth Avenue and Safeco Plaza of approximately $155.2 million, $54.0 million, $33.4 million and $29.9 million, respectively.

See Note 5 to the Consolidated Financial Statements.

Noncontrolling Interest in Property Partnerships activity

• On July 28, 2023, we entered into a joint venture agreement with an institutional investor for the future development of 343 Madison Avenue located on Madison Avenue between 44th and 45th Streets in New York City, New York adjacent to Grand Central Station.

Prior to the formation of the joint venture, we and the institutional investor were engaged in a collaborative arrangement.

We own a 55% interest in the venture and our partner owns a 45% interest, and we will provide customary development, property management, and leasing services.

The joint venture partner contributed approximately $4.8 million in cash and $17.5 million in improvements and prepaid ground rent for their 45% ownership interest in the joint venture.

We contributed approximately $5.9 million in cash and $21.4 million in improvements and prepaid ground rent for our 55% ownership interest in the joint venture.

The transaction did not qualify as a sale of real estate for financial reporting purposes as we continue to effectively control this property and will continue to account for the property on a consolidated basis in our financial statements, see Note 4 to the Consolidated Financial Statements.

• On February 9, 2024, a joint venture in which we own a 50% interest exercised an option to extend the maturity date of the construction loan collateralized by its 7750 Wisconsin Avenue property.

The construction loan had a total commitment amount of approximately $252.6 million.

The extended loan continues to bear interest at a variable rate equal to Term SOFR plus 1.35% per annum and matures on April 26, 2025.

At the time of the extension, the loan had an outstanding balance totaling approximately $251.6 million and was scheduled to mature on April 26, 2024.

7750 Wisconsin Avenue is a premier workplace with approximately 736,000 net rentable square feet located in Bethesda, Maryland.

Debt activities

• On September 1, 2023, BPLP completed the repayment of $500.0 million in aggregate principal amount of its 3.125% senior notes due September 1, 2023.

• On January 8, 2024, we acquired our joint venture partner’s 50% economic ownership interest in the joint venture that owns 901 New York Avenue located in Washington, DC (See Acquisition activity and Unconsolidated joint venture activities above).

The property is subject to existing mortgage indebtedness.

At acquisition, the mortgage loan had an outstanding principal balance of approximately $207.1 million, bore interest at 3.61% per annum and was scheduled to mature on January 5, 2025.

The mortgage loan was recorded at a fair value of approximately $198.7 million.

On January 11, 2024, we modified the mortgage loan to provide for two extension options totaling five years of additional term, each subject to certain conditions.

• On February 1, 2024, BPLP repaid $700.0 million in aggregate principal amount of its 3.800% senior notes due February 1, 2024.

The repayment was completed with available cash and the $600.0 million proceeds from the mortgage loan entered into on October 26, 2023.

The repayment price was approximately $713.3 million, which was equal to the stated principal plus approximately $13.3 million of accrued and unpaid interest to, but not including, the repayment date.

Excluding the accrued and unpaid interest, the repayment price was equal to the principal amount being repaid.

• On September 28, 2023, BPLP exercised the accordian feature of its $1.5 billion unsecured credit facility (the “2021 Credit Facility”) which allowed BPLP to increase the total commitment by up to $500.0 million, subject to syndication of the increase and other conditions (the “Accordion”).

BPLP exercised a portion of the Accordion with three new lenders to the 2021 Credit Facility (“New Lenders”).

Each of the New Lenders entered into a lender agreement with BPLP to provide an aggregate of $315.0 million in additional revolving credit commitments, which increased the maximum borrowing amount under the 2021 Credit Facility from $1.5 billion to $1.815 billion.

All other terms of the 2021 Credit Facility remain unchanged.

Transactions completed subsequent to September 30, 2023 included the following:

• On October 2, 2023, step two of the Metropolitan Square restructuring (see Note 5 to the Consolidated Financial Statements for a description of step one) was completed and included (i) the sale of the property and assignment of the Senior Loan to the new owner, and (ii) the closing of the New Mezz Loan with a maximum principal amount of $100.0 million that is senior to the Existing Mezz Loan and subordinate only to the Senior Loan.

The New Mezz Loan may be drawn upon for future lease-up, operating and other costs on an as needed basis, and amounts borrowed will bear interest at a per annum rate of 12%, compounded monthly.

We will fund 20%, or up to $20.0 million, of any amounts borrowed under the New Mezz Loan.

In addition, we will continue to provide property management and leasing services to the property with the potential to earn additional incentive fees.

Metropolitan Square is an approximately 657,000 square foot premier workplace located at 655 15th Street, NW in the heart of downtown Washington, DC.

• On October 26, 2023, we closed on a mortgage loan collateralized by our 325 Main Street, 355 Main Street, 90 Broadway and Cambridge East Garage (also known as Kendall Center Green Garage) properties located in Cambridge, Massachusetts.

The mortgage loan, totaling $600 million, requires interest-only payments at Daily Compounded SOFR plus 2.25% per annum until maturity on October 26, 2028.

• On November 6, 2023, WeWork Inc.

and certain of its direct and indirect subsidiaries (collectively, “WeWork”) filed voluntary petitions to commence proceedings under Chapter 11 of title 11 of the United States Code in the United States Bankruptcy Court for the District of New Jersey.

WeWork is a tenant at five of our premier workplaces and leases an aggregate of approximately 493,000 square feet, approximately 0.97% of our in-service portfolio.

There can be no assurance that WeWork will not reject one or more of the five leases.

Noncontrolling interest activity

• On March 21, 2024, we completed the sale of a 45% interest in 290 Binney Street in Cambridge, Massachusetts.

The institutional investor funded approximately $97.2 million in cash at closing, which is less than 45% of the agreed upon carrying value of the property immediately prior to the transaction.

The institutional investor will fund all construction costs until its equity balance is proportionate to its ownership percentage, after which we and the institutional investor will fund the development project based on our respective ownership interests.

We retain a 55% ownership interest in the joint venture.

The transaction did not qualify as a sale of real estate for financial reporting purposes as we continue to effectively control the property and thus will continue to account for the property on a consolidated basis in our financial statements and no gain was recognized in the Consolidated Statements of Operations.

We provide customary development, property management and leasing services to the

joint venture.

290 Binney Street is an approximately 566,000 net rentable square foot laboratory/life sciences development project located in Cambridge, Massachusetts.

The development project is 100% pre-leased to a life sciences company.

Transactions completed subsequent to March 31, 2024 included the following:

• On April 5, 2024, we completed and fully placed in-service 760 Boylston Street, an approximately 118,000 net rentable square feet retail redevelopment located in Boston, Massachusetts.

• On April 16, 2024, BPLP provided notice to exercise its one-year extension option on its $1.2 billion unsecured term loan facility (the “2023 Unsecured Term Loan”).

BPLP anticipates effectuating the extension on or prior to the current May 16, 2024 maturity date.

Upon effectiveness, the 2023 Unsecured Term Loan will mature on May 16, 2025.

After making an approximately $500.0 million optional repayment on April 29, 2024, the 2023 Unsecured Term Loan has an outstanding principal balance of $700.0 million.

• On April 17, 2024, BPLP established an unsecured commercial paper program.

Under the terms of the program, BPLP may issue, from time to time, unsecured commercial paper notes up to a maximum aggregate amount outstanding at any one time of $500 million with varying maturities of up to one year.

The notes will be sold in private placements and will rank pari passu with all of BPLP’s other unsecured senior indebtedness, including its outstanding senior notes.

The commercial paper program is backstopped by available capacity under BPLP's unsecured revolving credit facility (the “2021 Credit Facility”).

As of May 2, 2024, BPLP had $500.0 million outstanding under its commercial paper program that bears interest at a weighted-average rate of 5.58% per annum.

Proceeds from the commercial paper program were used to reduce BPLP’s 2023 Unsecured Term Loan to $700.0 million.

• On April 29, 2024, BPLP increased the current maximum borrowing amount under the 2021 Credit Facility from $1.815 billion to $2.0 billion.

All other terms of the 2021 Credit Facility, including its maturity date of June 15, 2026, remain unchanged.

BPLP had no borrowings under the 2021 Credit Facility as of May 2, 2024.

Critical Accounting Estimates

4 unchanged sentences

There have been no significant changes in our critical accounting estimates since the year ended December 31, 2023.

Results of Operations for the Nine Months Ended September 30, 2023 and 2022

Results of Operations for the Three Months Ended March 31, 2024 and 2023

Net income attributable to Boston Properties, Inc.

and net income attributable to Boston Properties Limited Partnership decreased by approximately $656.9 million and $735.0 million, respectively, for the nine months ended September 30, 2023 compared to 2022, as set forth in the following tables and for the reasons discussed below under the heading “ Comparison of the nine months ended September 30, 2023 to the nine months ended September 30, 2022” within “ Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations .”

and net income attributable to Boston Properties Limited Partnership increased approximately $2.0 million and $2.3 million, respectively, for the three months ended March 31, 2024 compared to 2023, as detailed in the following tables and for the reasons discussed below under the heading “ Comparison of the three months ended March 31, 2024 to the three months ended March 31, 2023” within “Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations.

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

to Net Operating Income and Net Income Attributable to Boston Properties Limited Partnership to Net Operating Income for the nine months ended September 30, 2023 and 2022.

to Net Operating Income and Net Income Attributable to Boston Properties Limited Partnership to Net Operating Income for the three months ended March 31, 2024 and 2023.

For a detailed discussion of Net Operating Income (“NOI”), including the reasons management believes NOI is useful to investors, see page 51.

Nine months ended September 30,

Three months ended March 31,

2024 2023 Increase/

10 unchanged sentences

Interest expense 161,891 134,207 27,684 20.63 %

Impairment loss

13,615 — 13,615 100.00 %

Loss from unconsolidated joint ventures 261,793 1,389 260,404 18,747.59 %

Other Income:

Unrealized gain on non-real estate investment 396 259 137 52.90 %

Gains (losses) from investments in securities 2,311 (8,549) 10,860 127.03 %

Other income - assignment fee — 6,624 (6,624) (100.00) %

Gains from investments in securities 2,272 1,665 607 36.46 %

Interest and other income (loss)

Gains on sales of real estate

14,529 10,941 3,588 32.79 %

Income (loss) from unconsolidated joint ventures 19,186 (7,569) 26,755 353.48 %

Other Expenses:

12 unchanged sentences

Net Operating Income $ 508,820 $ 491,006 $ 17,814 3.63 %

Nine months ended September 30,

Three months ended March 31,

2024 2023 Increase/

8 unchanged sentences

161,891 134,207 27,684 20.63 %

Loss from unconsolidated joint ventures 261,793 1,389 260,404 18,747.59 %

Impairment loss

13,615 — 13,615 100.00 %

Other Income:

Unrealized gain on non-real estate investment 396 259 137 52.90 %

Gains (losses) from investments in securities 2,311 (8,549) 10,860 127.03 %

Other income - assignment fee — 6,624 (6,624) (100.00) %

Gains from investments in securities 2,272 1,665 607 36.46 %

Interest and other income (loss)

Gains on sales of real estate

14,529 10,941 3,588 32.79 %

Income (loss) from unconsolidated joint ventures 19,186 (7,569) 26,755 353.48 %

Other Expenses:

12 unchanged sentences

Net Operating Income $ 508,820 $ 491,006 $ 17,814 3.63 %

At September 30, 2023 and 2022, we owned or had joint venture interests in a portfolio of 190 and 193 commercial real estate properties, respectively (in each case, the “Total Property Portfolio”).

At March 31, 2024 and 2023, we owned or had joint venture interests in a portfolio of 187 and 192 commercial real estate properties, respectively (in each case, the “Total Property Portfolio”).

As a result of changes within our Total Property Portfolio, the financial data presented below shows significant changes in revenue and expenses from period-to-period.

Accordingly, we do not believe that our period-to-period financial data with respect to the Total Property Portfolio provides a complete understanding of our operating results.

Therefore, the comparison of operating results for the three and nine months ended September 30, 2023 and 2022 show separately the changes attributable to the properties that were owned by us and in-service throughout each period compared (the “Same Property Portfolio”) and the changes attributable to the properties included in the Acquired, Placed In-Service, In or Held for Development or Redevelopment or Sold Portfolios.

In our analysis of operating results, particularly to make comparisons of NOI between periods more meaningful, it is important to provide information for properties that were in-service and owned by us throughout each period presented.

Therefore, the comparison of operating results for the three months ended March 31, 2024 and 2023 show separately the changes attributable to the properties that were owned by us and in-service throughout each period compared (the “Same Property Portfolio”) and the changes attributable to the properties included in the Acquired, Placed In-Service, Development or Redevelopment or Sold Portfolios.

In our analysis of operating results, particularly to make comparisons of net operating income between periods more meaningful, it is important to provide information for properties that were in-service and owned by us throughout each period presented.

We refer to properties acquired or placed in-service prior to the beginning of the earliest period presented and owned by us and in-service through the end of the latest period presented as our Same Property Portfolio.

1 unchanged sentence

NOI is a non-GAAP financial measure equal to net income attributable to Boston Properties, Inc.

and net income attributable to Boston Properties Limited Partnership, as applicable, the most directly comparable GAAP financial measures, plus (1) net income attributable to noncontrolling interests, interest expense, loss from unconsolidated joint ventures, depreciation and amortization expense, transaction costs, payroll and related costs from management services contracts and corporate general and administrative expense less (2) unrealized gain on non-real estate investment, gains (losses) from investments in securities, other income - assignment fee, interest and other income (loss), gains on sales of real estate, direct reimbursements of payroll and related costs from management services contracts and development and management services revenue.

contracts and corporate general and administrative expense less (2) unrealized gain on non-real estate investment, gains from investments in securities, interest and other income (loss), income (loss) from unconsolidated joint ventures, direct reimbursements of payroll and related costs from management services contracts and development and management services revenue.

We use NOI internally as a performance measure and believe it provides useful information to investors regarding our results of operations and financial condition because, when compared across periods, it reflects the impact on operations from trends in occupancy rates, rental rates, operating costs and acquisition and development activity on an unleveraged basis, providing perspective not immediately apparent from net income attributable to Boston Properties, Inc.

8 unchanged sentences

or net income attributable to Boston Properties Limited Partnership (determined in accordance with GAAP) or any other GAAP financial measures and should only be considered together with and as a supplement to our financial information prepared in accordance with GAAP.

The gains on sales of real estate and depreciation expense may differ between BXP and BPLP as a result of previously applied acquisition accounting by BXP for the issuance of common stock in connection with non-sponsor redemptions of common units of limited partnership interest of BPLP (“OP Units”).

This accounting resulted in a step-up of the real estate assets at BXP that was allocated to certain properties.

The difference between the real estate assets of BXP as compared to BPLP for certain properties having an allocation of the real estate step-up will result in a corresponding difference in gains on sales of real estate and depreciation expense when those properties are sold.

For additional information see the Explanatory Note that immediately follows the cover page of this Quarterly Report on Form 10-Q.

Comparison of the nine months ended September 30, 2023 to the nine months ended September 30, 2022

The table below shows selected operating information for the Same Property Portfolio and the Total Property Portfolio.

The Same Property Portfolio consists of 126 properties totaling approximately 38.3 million net rentable square feet, excluding unconsolidated joint ventures.

The Same Property Portfolio includes properties acquired or placed in-service on or prior to January 1, 2022 and owned and in service through September 30, 2023.

The Total Property Portfolio includes the effects of the other properties either acquired, placed in-service, in or held for development or redevelopment after January 1, 2022 or disposed of on or prior to September 30, 2023.

This table includes a reconciliation from the Same Property Portfolio to the Total Property Portfolio by also providing information for the nine months ended September 30, 2023 and 2022 with respect to the properties that were acquired, placed in-service, in or held for development or redevelopment or sold.

Same Property Portfolio Properties Acquired Portfolio Properties

Placed In-Service

Portfolio Properties in or Held for Development or Redevelopment Portfolio Properties Sold Portfolio Total Property Portfolio

2023 2022 Increase/

Change 2023 2022 2023 2022 2023 2022 2023 2022 2023 2022 Increase/

(dollars in thousands)

Rental Revenue:

Lease Revenue (Excluding Termination Income)

$ 2,070,012 $ 2,035,404 $ 34,608 1.70 % $ 71,763 $ 18,524 $ 103,519 $ 38,043 $ 2,357 $ 8,011 $ 1,248 $ 33,358 $ 2,248,899 $ 2,133,340 $ 115,559 5.42 %

Termination Income

1,333 5,579 (4,246) (76.11) % 1,046 402 218 — — — — — 2,597 5,981 (3,384) (56.58) %

Lease Revenue

2,071,345 2,040,983 30,362 1.49 % 72,809 18,926 103,737 38,043 2,357 8,011 1,248 33,358 2,251,496 2,139,321 112,175 5.24 %

Parking and Other

75,846 66,191 9,655 14.59 % 3,046 1,461 1,053 — — 7,511 1 806 79,946 75,969 3,977 5.24 %

Total Rental Revenue (1) 2,147,191 2,107,174 40,017 1.90 % 75,855 20,387 104,790 38,043 2,357 15,522 1,249 34,164 2,331,442 2,215,290 116,152 5.24 %

Real Estate Operating Expenses 819,124 770,781 48,343 6.27 % 12,034 5,013 29,659 10,274 4,408 5,935 327 10,528 865,552 802,531 63,021 7.85 %

Net Operating Income (Loss), Excluding Residential and Hotel 1,328,067 1,336,393 (8,326) (0.62) % 63,821 15,374 75,131 27,769 (2,051) 9,587 922 23,636 1,465,890 1,412,759 53,131 3.76 %

Residential Net Operating Income (2) 18,784 15,534 3,250 20.92 % — — — — — — — 5,410 18,784 20,944 (2,160) (10.31) %

Hotel Net Operating Income (2) 11,702 8,563 3,139 36.66 % — — — — — — — — 11,702 8,563 3,139 36.66 %

Net Operating Income (Loss) $ 1,358,553 $ 1,360,490 $ (1,937) (0.14) % $ 63,821 $ 15,374 $ 75,131 $ 27,769 $ (2,051) $ 9,587 $ 922 $ 29,046 $ 1,496,376 $ 1,442,266 $ 54,110 3.75 %

_______________

(1) Rental Revenue is equal to Revenue less Development and Management Services Revenue and Direct Reimbursements of Payroll and Related Costs from Management Services Revenue per the Consolidated Statements of Operations, excluding the residential and hotel revenue that is noted below.

We use Rental Revenue internally as a performance measure and in calculating other non-GAAP financial measures (e.g., NOI), which provides investors with information regarding our performance that is not immediately apparent from the comparable non-GAAP measures and allows investors to compare operating performance between periods.

(2) For a detailed discussion of NOI, including the reasons management believes NOI is useful to investors, see page 60.

Residential Net Operating Income for the nine months ended September 30, 2023 and 2022 is comprised of Residential Revenue of $35,768 and $44,218 less Residential Expenses of $16,984 and $23,274, respectively.

Hotel Net Operating Income for the nine months ended September 30, 2023 and 2022 is comprised of Hotel Revenue of $35,554 and $28,395 less Hotel Expenses of $23,852 and $19,832, respectively, per the Consolidated Statements of Operations.

Same Property Portfolio

Lease Revenue (Excluding Termination Income)

Lease revenue (excluding termination income) from the Same Property Portfolio increased by approximately $34.6 million for the nine months ended September 30, 2023 compared to 2022.

The increase was a result of our average revenue per square foot increasing by approximately $2.08, contributing approximately $57.9 million, partially offset by average occupancy decreasing from 91.4% to 90.3%, resulting in a decrease of approximately $23.3 million.

Termination Income

Termination income decreased by approximately $4.2 million for the nine months ended September 30, 2023 compared to 2022.

Termination income for the nine months ended September 30, 2023 related to approximately 20 clients across the Same Property Portfolio and totaled approximately $1.3 million, which was primarily related to clients that terminated leases early in Washington, DC.

Termination income for the nine months ended September 30, 2022 related to 21 clients across the Same Property Portfolio and totaled approximately $5.0 million, which was primarily related to clients that terminated leases early in New York City.

In addition, we received a distribution from our unsecured credit claim against Lehman Brothers, Inc.

of approximately $0.6 million.

Parking and Other Revenue

Parking and other revenue increased by approximately $9.7 million for the nine months ended September 30, 2023 compared to 2022.

Parking and other revenue increased by approximately $6.4 million and $3.3 million, respectively.

The increase in parking revenue was primarily due to an increase in transient and monthly parking.

The increase in other revenue was primarily related to the View Boston observatory, which was completed and placed in-service on June 1, 2023.

Real Estate Operating Expenses

Real estate operating expenses from the Same Property Portfolio increased by approximately $48.3 million, or 6.3%, for the nine months ended September 30, 2023 compared to 2022, due primarily to increases in real estate taxes of approximately $15.8 million, or 4.2%, and other real estate operating expenses of approximately $26.9 million, or 6.9%.

The increase in real estate taxes was primarily in New York City.

In addition, there was approximately $5.6 million related to the marketing and operating expenses associated with the View Boston observatory which was completed and placed in-service on June 1, 2023.

Properties Acquired Portfolio

The table below lists the properties acquired between January 1, 2022 and September 30, 2023.

Rental revenue and real estate operating expenses increased by approximately $55.5 million and $7.0 million, respectively, for the nine months ended September 30, 2023 compared to 2022, as detailed below.

Square Feet Rental Revenue Real Estate Operating Expenses

Name Date acquired 2023 2022 Change 2023 2022 Change

(dollars in thousands)

Madison Centre (1) May 17, 2022 754,988 $ 44,971 $ 18,765 $ 26,206 $ 9,017 $ 4,805 $ 4,212

125 Broadway September 16, 2022 271,000 30,884 1,622 29,262 3,017 208 2,809

1,025,988 $ 75,855 $ 20,387 $ 55,468 $ 12,034 $ 5,013 $ 7,021

______________

(1) Rental revenue for the nine months ended September 30, 2023 and September 30, 2022 includes approximately $1.0 million and $0.4 million of termination income, respectively.

Properties Placed In-Service Portfolio

The table below lists the properties that were placed in-service or partially placed in-service between January 1, 2022 and September 30, 2023.

Rental revenue and real estate operating expenses from our Properties Placed In-Service Portfolio increased by approximately $66.7 million and $19.4 million, respectively, for the nine months ended September 30, 2023 compared to 2022, as detailed below.

Quarter Initially Placed In-Service Quarter Fully Placed In-Service Rental Revenue Real Estate Operating Expenses

Name Square Feet 2023 2022 Change 2023 2022 Change

(dollars in thousands)

Reston Next Fourth Quarter, 2021 Fourth Quarter, 2022 1,063,296 $ 34,352 $ 24,029 $ 10,323 $ 11,934 $ 7,861 $ 4,073

325 Main Street Second Quarter, 2022 Second Quarter, 2022 414,565 34,787 10,295 24,492 6,317 830 5,487

2100 Pennsylvania Avenue Second Quarter, 2022 Second Quarter, 2023 475,849 15,911 169 15,742 6,752 305 6,447

880 Winter Street (1) Third Quarter, 2022 Fourth Quarter, 2022 243,618 18,235 684 17,551 4,111 376 3,735

140 Kendrick Street - Building A Third Quarter, 2023 Third Quarter, 2023 104,166 1,505 2,866 (1,361) 545 902 (357)

180 CityPoint Third Quarter, 2023 N/A 329,000 — — — — — —

2,630,494 $ 104,790 $ 38,043 $ 66,747 $ 29,659 $ 10,274 $ 19,385

_____________

(1) Conversion of a 224,000 square foot office property located in Waltham, Massachusetts to laboratory space.

Rental revenue for the nine months ended September 30, 2023 includes approximately $0.2 million of termination income.

Properties in or Held for Development or Redevelopment Portfolio

The table below lists the properties that were in or held for development or redevelopment between January 1, 2022 and September 30, 2023.

Rental revenue and real estate operating expenses from our Properties in or Held for Development or Redevelopment Portfolio decreased by approximately $13.2 million and $1.5 million, respectively, for the nine months ended September 30, 2023 compared to 2022, as detailed below.

Rental Revenue Real Estate Operating Expenses

Name Date Commenced or Held for Development / Redevelopment Square Feet 2023 2022 Change 2023 2022 Change

(dollars in thousands)

760 Boylston Street September 12, 2022 118,000 $ — $ — $ — $ — $ 608 $ (608)

105 Carnegie Center November 30, 2022 73,000 — 931 (931) — 697 (697)

2096 Gaither Road December 1, 2022 50,000 — 164 (164) 93 273 (180)

RTC Next-Hotel (1) December 19, 2022 N/A 688 — 688 2 — 2

Kendall Center Blue Parking Garage (2) January 4, 2023 N/A — 7,485 (7,485) 2,395 946 1,449

300 Binney Street January 30, 2023 236,000 — 4,651 (4,651) — 1,432 (1,432)

Lexington Office Park (3) March 31, 2023 166,779 1,316 1,838 (522) 1,615 1,729 (114)

2098 Gaither Road (3) March 31, 2023 50,000 353 453 (100) 303 250 53

693,779 $ 2,357 $ 15,522 $ (13,165) $ 4,408 $ 5,935 $ (1,527)

_____________

(1) On December 19, 2022, in accordance with GAAP, the ground lease that encumbers this property was reclassified as a sales-type lease and the associated assets were derecognized.

(2) The Kendall Center Blue Parking Garage was taken out of service on January 4, 2023 to support the development of 290 Binney Street.

Real estate operating expenses for the nine months ended September 30, 2023 included approximately $2.4 million of demolition costs.

(3) Lexington Office Park and 2098 Gaither Road are no longer considered “in-service” because each property’s occupied percentage is less than 50% and we are no longer actively leasing the properties in anticipation of a future development/redevelopment.

Properties Sold Portfolio

The table below lists the properties we sold between January 1, 2022 and September 30, 2023.

Rental revenue and real estate operating expenses from our Properties Sold Portfolio decreased by approximately $42.0 million and $13.9 million, respectively, for the nine months ended September 30, 2023 compared to 2022, as detailed below.

Rental Revenue Real Estate Operating Expenses

Name Date Sold Property Type Square Feet 2023 2022 Change 2023 2022 Change

(dollars in thousands)

195 West Street March 31, 2022 Office 63,500 $ — $ 749 $ (749) $ — $ 242 $ (242)

Virginia 95 Office Park June 15, 2022 Office/Flex 733,421 — 5,190 (5,190) — 1,787 (1,787)

601 Massachusetts Avenue August 30, 2022 Office 478,667 — 28,225 (28,225) — 8,499 (8,499)

Total Office 1,275,588 — 34,164 (34,164) — 10,528 (10,528)

The Avant at Reston Town Center (1) November 8, 2022 Residential 329,195 1,249 9,099 (7,850) 327 3,689 (3,362)

Total Residential 329,195 1,249 9,099 (7,850) 327 3,689 (3,362)

1,604,783 $ 1,249 $ 43,263 $ (42,014) $ 327 $ 14,217 $ (13,890)

_____________

(1) We retained and continue to own approximately 26,000 square feet of ground-level retail space.

Rental Revenue and Real Estate Operating Expenses for the nine months ended September 30, 2023 represent the ground-level retail space.

Rental Revenue and Real Estate Operating Expenses for the nine months ended September 30, 2022 represent the entire property and not just the portion sold.

For additional information on the sales of the above properties refer to “Results of Operations—Other Income and Expense Items—Gains on Sales of Real Estate” within “Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

Residential Net Operating Income

Net operating income for our residential same properties increased by approximately $3.3 million for the nine months ended September 30, 2023 compared to 2022.

The following reflects our occupancy and rate information for our residential same properties for the nine months ended September 30, 2023 and 2022.

Average Monthly Rental Rate (1) Average Rental Rate Per Occupied Square Foot Average Physical Occupancy (2) Average Economic Occupancy (3)

Name 2023 2022 Change (%) 2023 2022 Change (%) 2023 2022 Change (%) 2023 2022 Change (%)

Proto Kendall Square $ 3,060 $ 2,804 9.1 % $ 5.62 $ 5.16 8.9 % 95.5 % 94.8 % 0.7 % 95.1 % 94.1 % 1.1 %

The Lofts at Atlantic Wharf $ 4,443 $ 4,089 8.7 % $ 4.92 $ 4.55 8.1 % 96.3 % 97.8 % (1.5) % 96.1 % 97.3 % (1.2) %

Signature at Reston $ 2,689 $ 2,644 1.7 % $ 2.79 $ 2.73 2.2 % 94.6 % 95.2 % (0.6) % 93.9 % 94.7 % (0.8) %

The Skylyne $ 3,467 $ 3,378 2.6 % $ 4.41 $ 4.15 6.3 % 92.3 % 82.7 % 11.6 % 90.2 % 80.2 % 12.5 %

_____________

(1) Average Monthly Rental Rate is calculated as the average of the quotients obtained by dividing (A) rental revenue as determined in accordance with GAAP, by (B) the number of occupied units for each month within the applicable fiscal period.

(2) Average Physical Occupancy is defined as (1) the average number of occupied units divided by (2) the total number of units, expressed as a percentage.

(3) Average Economic Occupancy is defined as (1) total possible revenue less vacancy loss divided by (2) total possible revenue, expressed as a percentage.

Total possible revenue is determined by valuing average occupied units at contract rates and average vacant units at Market Rents.

Vacancy loss is determined by valuing vacant units at current

Market Rents.

By measuring vacant units at their Market Rents, Average Economic Occupancy takes into account the fact that units of different sizes and locations within a residential property have different economic impacts on a residential property’s total possible gross revenue.

Market Rents used by us in calculating Economic Occupancy are based on the current market rates set by the managers of our residential properties based on their experience in renting their residential property’s units and publicly available market data.

Actual market rents and trends in such rents for a region as reported by others may vary materially from Market Rents used by us.

Market Rents for a period are based on the average Market Rents during that period and do not reflect any impact for cash concessions.

Hotel Net Operating Income

The Boston Marriott Cambridge hotel had net operating income of approximately $11.7 million for the nine months ended September 30, 2023, representing an increase of approximately $3.1 million compared to the nine months ended September 30, 2022.

As demand for travel has returned, the Boston Marriott Cambridge has seen an increase in occupancy and room rates, which has led to increased net operating income.

The following reflects our occupancy and rate information for the Boston Marriott Cambridge hotel for the nine months ended September 30, 2023 and 2022.

Occupancy 73.5 % 63.4 % 15.9 %

Average daily rate $ 326.22 $ 315.24 3.5 %

REVPAR $ 239.64 $ 199.83 19.9 %

Other Operating Revenue and Expense Items

Development and Management Services Revenue

Development and management services revenue increased by approximately $8.5 million for the nine months ended September 30, 2023 compared to 2022.

Development services revenue and management services revenue increased by approximately $2.9 million and $5.6 million, respectively.

The increase in development services revenue was primarily related to an increase in development fees earned from unconsolidated joint venture properties in the San Francisco and Washington, DC regions.

The increase in management services revenue was primarily related to an increase in property management fees from an unconsolidated joint venture in the New York region and asset management fees earned from an unconsolidated joint venture in the Los Angeles region.

General and Administrative Expense

General and administrative expense increased by approximately $21.0 million for the nine months ended September 30, 2023 compared to 2022 primarily due to increases in compensation expense and other general and administrative expenses of approximately $19.0 million and $2.0 million, respectively.

The increase in compensation expense related to (1) an approximately $10.8 million increase in the value of our deferred compensation plan and (2) an approximately $8.2 million increase in other compensation expenses, primarily due to age-based vesting and annual increases in employee compensation.

The increase in other general and administrative expenses primarily related to an increase in professional fees.

Wages directly related to the development of rental properties are capitalized and included in real estate assets on our Consolidated Balance Sheets and amortized over the useful lives of the applicable asset or lease term.

Capitalized wages for the nine months ended September 30, 2023 and 2022 were approximately $13.5 million and $12.0 million, respectively.

These costs are not included in the general and administrative expenses discussed above.

Transaction Costs

Transaction costs decreased by approximately $0.2 million for the nine months ended September 30, 2023 compared to 2022.

In general, transaction costs relating to the formation of new joint ventures and the pursuit of other transactions are expensed as incurred.

Depreciation and Amortization Expense

Depreciation expense may differ between BXP and BPLP as a result of previously applied acquisition accounting by BXP for the issuance of common stock in connection with non-sponsor OP Unit redemptions by BPLP.

This accounting resulted in a step-up of the real estate assets at BXP that was allocated to certain properties.

For additional information see the Explanatory Note that immediately follows the cover page of this Quarterly Report on Form 10-Q.

Depreciation and amortization expense increased by approximately $67.3 million for the nine months ended September 30, 2023 compared to 2022, as detailed below.

Portfolio Depreciation and Amortization for the nine months ended September 30,

2023 2022 Change

(in thousands)

Same Property Portfolio $ 528,915 $ 507,731 $ 21,184

Properties Acquired Portfolio 52,406 13,703 38,703

Properties Placed In-Service Portfolio 36,080 14,522 21,558

Properties in or Held for Development or Redevelopment Portfolio (1) 1,010 7,438 (6,428)

Properties Sold Portfolio 335 8,051 (7,716)

$ 618,746 $ 551,445 $ 67,301

_____________

(1) During the nine months ended September 30, 2023, the Kendall Center Blue Parking Garage was taken out of service and demolished to support the development of 290 Binney Street, an approximately 566,000 net rentable square foot laboratory/life sciences project in Cambridge, Massachusetts.

As a result, during the nine months ended September 30, 2023, we recorded approximately $0.8 million of accelerated depreciation expense for the demolition of the garage, of which approximately $0.2 million related to the step-up of real estate assets.

Depreciation and amortization expense increased by approximately $67.2 million for the nine months ended September 30, 2023 compared to 2022, as detailed below.

Portfolio Depreciation and Amortization for the nine months ended September 30,

2023 2022 Change

(in thousands)

Same Property Portfolio $ 523,615 $ 502,557 $ 21,058

Properties Acquired Portfolio 52,406 13,703 38,703

Properties Placed In-Service Portfolio 36,080 14,522 21,558

Properties in or Held for Development or Redevelopment Portfolio (1) 1,010 7,438 (6,428)

Properties Sold Portfolio 335 8,051 (7,716)

$ 613,446 $ 546,271 $ 67,175

_____________

As a result, during the nine months ended September 30, 2023, we recorded approximately $0.6 million of accelerated depreciation expense for the demolition of the garage.

Direct Reimbursements of Payroll and Related Costs From Management Services Contracts and Payroll and Related Costs From Management Service Contracts

We have determined that amounts reimbursed for payroll and related costs received from third parties in connection with management services contracts should be reflected on a gross basis instead of on a net basis as we have determined that we are the principal under these arrangements.

We anticipate that these two financial statement line items will generally offset each other.

Other Income and Expense Items

Loss from Unconsolidated Joint Ventures

For the nine months ended September 30, 2023 compared to 2022, loss from unconsolidated joint ventures increased by approximately $260.4 million primarily due to non-cash impairment charges related to our investments in 360 Park Avenue South, 200 Fifth Avenue, Platform 16, and Safeco Plaza of approximately $54.0 million, $33.4 million, $155.2 million, and $29.9 million, respectively, partially offset by an approximately $35.8 million gain on investment related to our Metropolitan Square joint venture interest (See Note 5 to the Consolidated Financial Statements).

Gains on Sales of Real Estate

Gains on sales of real estate may differ between BXP and BPLP as a result of previously applied acquisition accounting by BXP for the issuance of common stock in connection with non-sponsor OP Unit redemptions by BPLP.

This accounting resulted in a step-up of the real estate assets at BXP that was allocated to certain properties.

The difference between the real estate assets of BXP as compared to BPLP for certain properties having an allocation of the real estate step-up will result in a corresponding difference in the gains on sales of real estate when those properties are sold.

For additional information, see the Explanatory Note that immediately follows the cover page of this Quarterly Report on Form 10-Q.

Gains on sales of real estate decreased by approximately $380.8 million for the nine months ended September 30, 2023 compared to 2022, as detailed below.

Name Date Sold Property Type Square Feet Sale Price Net Cash Proceeds Gain on Sale of Real Estate

(dollars in millions)

N/A $ — $ — $ — (1)

195 West Street March 31, 2022 Office 63,500 $ 37.7 $ 35.4 $ 22.7

Virginia 95 Office Park June 15, 2022 Office/Flex 733,421 127.5 121.9 96.2

601 Massachusetts Avenue August 30, 2022 Office 478,667 531.0 512.3 237.4

Broadrun Land Parcel September 15, 2022 Land N/A 27.0 25.6 24.4

$ 723.2 $ 695.2 $ 380.7 (2)

(1) Excludes approximately $0.5 million of gains on sales of real estate recognized during the nine months ended September 30, 2023 related to gain amounts from sales of real estate occurring in prior periods.

(2) Excludes approximately $0.6 million of gains on sales of real estate recognized during the nine months ended September 30, 2022 related to gain amounts from sales of real estate occurring in prior periods.

Gains on sales of real estate decreased by approximately $384.8 million for the nine months ended September 30, 2023 compared to 2022, as detailed below.

Name Date Sold Property Type Square Feet Sale Price Net Cash Proceeds Gain on Sale of Real Estate

(dollars in millions)

N/A $ — $ — $ — (1)

195 West Street March 31, 2022 Office 63,500 $ 37.7 $ 35.4 $ 23.4

Virginia 95 Office Park June 15, 2022 Office/Flex 733,421 127.5 121.9 99.5

601 Massachusetts Avenue August 30, 2022 Office 478,667 531.0 512.3 237.5

Broadrun Land Parcel September 15, 2022 Land N/A 27.0 25.6 24.4

$ 723.2 $ 695.2 $ 384.8 (2)

(2) Excludes approximately $0.5 million of gains on sales of real estate recognized during the nine months ended September 30, 2022 related to gain amounts from sales of real estate occurring in prior periods.

Interest and Other Income (Loss)

Interest and other income (loss) increased by approximately $42.8 million for the nine months ended September 30, 2023 compared to 2022, due primarily to an increase of approximately $43.6 million in interest income due to increased interest earned on our deposits partially offset by an increase in our allowance for current expected credit losses of approximately $0.8 million.

Other Income - Assignment Fee

On April 19, 2021, we 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, we executed an agreement to assign the 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.

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

Gains (Losses) from Investments in Securities

Gains (losses) from investments in securities for the nine months ended September 30, 2023 and 2022 related to investments that we have made to reduce our market risk relating to deferred compensation plans that we maintain for BXP’s officers and former non-employee directors.

Under the deferred compensation plans, each officer or non-employee director who is eligible to participate is permitted to defer a portion of the officer’s current income or the non-employee director’s compensation on a pre-tax basis and receive a tax-deferred return on these deferrals based on the performance of specific investments selected by the officer or non-employee director.

In order to reduce our market risk relating to these plans, we typically acquire, in a separate account that is not restricted as to its use, similar or identical investments as those selected by each officer or non-employee director.

This enables us to generally match our liabilities to BXP’s officers or former non-employee directors under our deferred compensation plans with equivalent assets and thereby limit our market risk.

The performance of these investments is recorded as gains (losses) from investments in securities.

During the nine months ended September 30, 2023 and 2022, we recognized gains (losses) of approximately $2.3 million and $(8.5) million, respectively, on these investments.

By comparison, our general and administrative expense increased (decreased) by approximately $2.3 million and $(8.5) million during the nine months ended September 30, 2023 and 2022, respectively, as a result of increases (decreases) in our liability under our deferred compensation plans that was associated with the performance of the specific investments selected by officers and former non-employee directors of BXP participating in the plans.

Unrealized Gain on Non-Real Estate Investment

During the year ended December 31, 2022, we began investing in non-real estate investments, which are primarily environmentally focused investment funds.

As a result, for the nine months ended September 30, 2023, we recognized an unrealized gain of approximately $0.3 million due to the observable changes in the fair value of the investments.

Interest Expense

Interest expense increased by approximately $107.3 million for the nine months ended September 30, 2023 compared to 2022, as detailed below.

Component Change in interest expense for the nine months ended September 30, 2023 compared to September 30, 2022

(in thousands)

Increases to interest expense due to:

Increase in interest associated with unsecured term loans and the unsecured credit facility, net $ 39,236

Issuance of $750 million in aggregate principal of 6.750% senior notes due 2027 on November 17, 2022 38,025

Issuance of $750 million in aggregate principal of 6.500% senior notes due 2034 on May 15, 2023 18,338

Increase in interest due to finance lease for one in-service property 7,377

Amortization expense of financing fees primarily related to unsecured term loan 2,661

Decrease in capitalized interest related to development projects 1,998

Other interest expense (excluding senior notes) 937

Total increases to interest expense 108,572

Decrease to interest expense due to:

Repayment of $500 million in aggregate principal of 3.125% senior notes due 2023 on September 1, 2023 (1,296)

Total decrease to interest expense (1,296)

Total change in interest expense $ 107,276

Interest expense directly related to the development of rental properties is capitalized and included in real estate assets on our Consolidated Balance Sheets and amortized over the useful lives of the real estate or lease term.

As portions of properties are placed in-service, we cease capitalizing interest on that portion and interest is then expensed.

Interest capitalized for the nine months ended September 30, 2023 and 2022 was approximately $30.8 million and $40.0 million, respectively.

These costs are not included in the interest expense referenced above.

At September 30, 2023, our variable rate debt consisted of BPLP’s $1.815 billion revolving credit facility (the “Revolving Facility”) under its 2021 Credit Facility and $1.2 billion 2023 Unsecured Term Loan.

As of September 30, 2023, the Revolving Facility did not have a balance outstanding and the 2023 Unsecured Term Loan had $1.2 billion outstanding.

On May 2, 2023, BPLP entered into four interest rate swap contracts with notional amounts aggregating $1.2 billion to effectively fix Term SOFR, the reference rate for the 2023 Unsecured Term Loan, at a weighted-average rate of 4.6420% for the period commencing on May 4, 2023 and ending on May 16, 2024.

For a summary of our consolidated debt as of September 30, 2023 refer to the heading “ Liquidity and Capital Resources—Debt Financing” within “ Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Noncontrolling Interests in Property Partnerships

Noncontrolling interests in property partnerships increased by approximately $4.4 million for the nine months ended September 30, 2023 compared to 2022, as detailed below.

Property Noncontrolling Interests in Property Partnerships for the nine months ended September 30,

2023 2022 Change

(in thousands)

767 Fifth Avenue (the General Motors Building) $ 9,770 $ 9,338 $ 432

Times Square Tower (1) 16,737 15,394 1,343

601 Lexington Avenue (2) 11,188 9,281 1,907

100 Federal Street 9,732 9,814 (82)

Atlantic Wharf Office Building 11,910 11,069 841

343 Madison Avenue (3) — — —

$ 59,337 $ 54,896 $ 4,441

______________

(1) The increase was primarily attributable to an increase in lease revenue from our clients.

(2) The increase was primarily attributable to an increase in lease revenue from our clients.

(3) 343 Madison Avenue is held for future development (See Notes 4 and 9 to the Consolidated Financial Statements).

Noncontrolling Interest—Common Units of the Operating Partnership

For BXP, noncontrolling interest—common units of the Operating Partnership decreased by approximately $74.2 million for the nine months ended September 30, 2023 compared to 2022 due primarily to a decrease in allocable income, which was the result of recognizing a greater gain on sales of real estate amount during 2022.

Due to our ownership structure, there is no corresponding line item on BPLP’s financial statements.

Results of Operations for the Three Months Ended September 30, 2023 and 2022

Net income (loss) attributable to Boston Properties, Inc.

and net income (loss) attributable to Boston Properties Limited Partnership decreased approximately $472.8 million and $526.3 million, respectively, for the three months ended September 30, 2023 compared to 2022, as detailed in the following tables and for the reasons discussed below under the heading “ Comparison of the three months ended September 30, 2023 to the three months ended September 30, 2022” within “Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following are reconciliations of Net Income (Loss) Attributable to Boston Properties, Inc.

to Net Operating Income and Net Income (Loss) Attributable to Boston Properties Limited Partnership to Net Operating Income for the three months ended September 30, 2023 and 2022.

For a detailed discussion of NOI, including the reasons management believes NOI is useful to investors, see page 71.

Three months ended September 30,

2023 2022 Increase/

(in thousands)

Net Income (Loss) Attributable to Boston Properties, Inc.

$ (111,826) $ 360,977 $ (472,803) (130.98) %

Net (Income) Loss Attributable to Noncontrolling Interests:

Noncontrolling interest—common units of the Operating Partnership

(12,626) 40,883 (53,509) (130.88) %

Noncontrolling interests in property partnerships

20,909 18,801 2,108 11.21 %

Net Income (Loss) (103,543) 420,661 (524,204) (124.61) %

Other Expenses:

Interest expense 147,812 111,846 35,966 32.16 %

Unrealized loss on non-real estate investment 51 — 51 100.00 %

Losses from investments in securities 925 1,571 (646) (41.12) %

Loss from unconsolidated joint ventures 247,556 3,524 244,032 6,924.86 %

Other Income:

Interest and other income (loss)

20,715 3,728 16,987 455.66 %

Gains on sales of real estate 517 262,345 (261,828) (99.80) %

Other Expenses:

Depreciation and amortization expense 207,435 190,675 16,760 8.79 %

Transaction costs

751 1,650 (899) (54.48) %

Payroll and related costs from management services contracts

3,906 3,900 6 0.15 %

General and administrative expense

31,410 32,519 (1,109) (3.41) %

Other Revenue:

Direct reimbursements of payroll and related costs from management services contracts

3,906 3,900 6 0.15 %

Development and management services revenue

9,284 7,465 1,819 24.37 %

Net Operating Income $ 501,881 $ 488,908 $ 12,973 2.65 %

Three months ended September 30,

2023 2022 Increase/

(in thousands)

Net Income (Loss) Attributable to Boston Properties Limited Partnership $ (122,696) $ 403,578 $ (526,274) (130.40) %

Net Income Attributable to Noncontrolling Interests:

Noncontrolling interests in property partnerships

20,909 18,801 2,108 11.21 %

Net Income (Loss) (101,787) 422,379 (524,166) (124.10) %

Other Expenses:

Interest expense

147,812 111,846 35,966 32.16 %

Unrealized loss on non-real estate investment 51 — 51 100.00 %

Losses from investments in securities 925 1,571 (646) (41.12) %

Loss from unconsolidated joint ventures 247,556 3,524 244,032 6,924.86 %

Other Income:

Interest and other income (loss)

20,715 3,728 16,987 455.66 %

Gains on sales of real estate 517 262,357 (261,840) (99.80) %

Other Expenses:

Depreciation and amortization expense 205,679 188,969 16,710 8.84 %

Transaction costs

751 1,650 (899) (54.48) %

Payroll and related costs from management services contracts

3,906 3,900 6 0.15 %

General and administrative expense

31,410 32,519 (1,109) (3.41) %

Other Revenue:

Direct reimbursements of payroll and related costs from management services contracts

3,906 3,900 6 0.15 %

Development and management services revenue

9,284 7,465 1,819 24.37 %

Net Operating Income $ 501,881 $ 488,908 $ 12,973 2.65 %

NOI is a non-GAAP financial measure equal to net income (loss) attributable to Boston Properties, Inc.

and net income (loss) attributable to Boston Properties Limited Partnership, as applicable, the most directly comparable GAAP financial measures, plus (1) net (income) loss attributable to noncontrolling interests, interest expense, unrealized loss on non-real estate investment, losses from investments in securities, loss from unconsolidated joint ventures, depreciation and amortization expense, transaction costs, payroll and related costs from management services contracts and corporate general and administrative expense less (2) interest and other income (loss), gains on sales of real estate, direct reimbursements of payroll and related costs from management services contracts and development and management services revenue.

and net income (loss) attributable to Boston Properties Limited Partnership.

For example, interest expense is not necessarily linked to the operating performance of a real estate asset and is often incurred at the corporate level as opposed to the property level.

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

NOI presented by us may not be comparable to NOI reported by other REITs or real estate companies that define NOI differently.

We believe that in order to understand our operating results, NOI should be examined in conjunction with net income (loss) attributable to Boston Properties, Inc.

and net income (loss) attributable to Boston Properties Limited Partnership as presented in our Consolidated Financial Statements.

NOI should not be considered as a substitute for net income (loss) attributable to Boston Properties, Inc.

or net income (loss) attributable to Boston Properties Limited Partnership (determined in accordance with GAAP) or any other GAAP financial measures and should only be considered together with and as a supplement to our financial information prepared in accordance with GAAP.

Comparison of the three months ended September 30, 2023 to the three months ended September 30, 2022

The difference between the real estate assets of BXP as compared to BPLP for certain properties having an allocation of the real estate step-up will result in a corresponding difference in depreciation expense when those properties are sold.

For additional information see the Explanatory Note that follows the cover page of this Quarterly Report on Form 10-Q.

Comparison of the three months ended March 31, 2024 to the three months ended March 31, 2023

The table below shows selected operating information for the Same Property Portfolio and the Total Property Portfolio.

The Same Property Portfolio consists of 130 properties totaling approximately 40.8 million net rentable square feet, excluding unconsolidated joint ventures.

The Same Property Portfolio includes properties acquired or placed in-service on or prior to July 1, 2022 and owned and in-service through September 30, 2023.

The Total Property Portfolio includes the effects of the other properties either acquired, placed in-service, in or held for development or redevelopment after July 1, 2022 or disposed of on or prior to September 30, 2023.

This table includes a reconciliation from the Same Property Portfolio to the Total Property Portfolio by also providing information for the three months ended September 30, 2023 and 2022 with respect to the properties that were acquired, placed in-service, in or held for development or redevelopment or sold.

The Same Property Portfolio includes properties acquired or placed in-service on or prior to January 1, 2023 and owned and in-service through March 31, 2024.

The Total Property Portfolio includes the effects of the other properties either acquired, placed in-service, in or held for development or redevelopment after January 1, 2023 or disposed of on or prior to March 31, 2024.

This table includes a reconciliation from the Same Property Portfolio to the Total Property Portfolio by also providing information for the three months ended March 31, 2024 and 2023 with respect to the properties that were acquired, placed in-service, in or held for development or redevelopment or sold.

We did not sell any properties during the three months ended March 31, 2024 and 2023.

Same Property Portfolio Properties

4 unchanged sentences

Redevelopment

Portfolio Properties Sold Portfolio Total Property Portfolio

Portfolio Total Property Portfolio

2024 2023 Increase/

11 unchanged sentences

Real Estate Operating Expenses 292,630 280,084 12,546 4.48 % 9,577 — 4,963 1,727 1,301 4,034 308,471 285,845 22,626 7.92 %

Net Operating Income, Excluding Residential and Hotel 465,005 465,609 (604) (0.13) % 9,218 1,414 16,187 6,182 564 392 392 4,794 491,366 478,391 12,975 2.71 %

Net Operating Income (Loss), Excluding Residential and Hotel 474,126 483,519 (9,393) (1.94) % 18,624 — 7,960 3,414 (1,059) (3,620) 499,651 483,313 16,338 3.38 %

Residential Net Operating Income (2) 6,998 6,263 735 11.74 % — — — — — — 6,998 6,263 735 11.74 %

Hotel Net Operating Income (2) 2,171 1,430 741 51.82 % — — — — — — 2,171 1,430 741 51.82 %

Net Operating Income $ 475,520 $ 474,287 $ 1,233 0.26 % $ 9,218 $ 1,414 $ 16,187 $ 6,182 $ 564 $ 392 $ 392 $ 6,633 $ 501,881 $ 488,908 $ 12,973 2.65 %

Net Operating Income (Loss) $ 483,295 $ 491,212 $ (7,917) (1.61) % $ 18,624 $ — $ 7,960 $ 3,414 $ (1,059) $ (3,620) $ 508,820 $ 491,006 $ 17,814 3.63 %

_______________

2 unchanged sentences

(2) For a detailed discussion of NOI, including the reasons management believes NOI is useful to investors, see page 51.

Residential Net Operating Income for the three months ended September 30, 2023 and 2022 is comprised of Residential Revenue of $11,789 and $14,340 less Residential Expenses of $5,738 and $7,024, respectively.

Hotel Net Operating Income for the three months ended September 30, 2023 and 2022 is comprised of Hotel Revenue of $13,484 and $11,749 less Hotel Expenses of $9,020 and $8,548, respectively, per the Consolidated Statements of Operations.

Residential Net Operating Income for the three months ended March 31, 2024 and 2023 is comprised of Residential Revenue of $12,684 and $11,726 less Residential Expenses of $5,686 and $5,463, respectively.

Hotel Net Operating Income for the three months ended March 31, 2024 and 2023 is comprised of Hotel Revenue of $8,186 and $8,101 less Hotel Expenses of $6,015 and $6,671, respectively, per the Consolidated Statements of Operations.

Same Property Portfolio

Lease Revenue (Excluding Termination Income)

Lease revenue (excluding termination income) from the Same Property Portfolio increased by approximately $12.0 million for the three months ended September 30, 2023 compared to 2022.

The increase was a result of our average revenue per square foot increasing by approximately $1.80, contributing approximately $18.1 million, partially offset by an approximately $6.1 million decrease due to our average occupancy decreasing from 91.1% to 90.3%.

Lease revenue (excluding termination income) from the Same Property Portfolio decreased by approximately $3.6 million for the three months ended March 31, 2024 compared to 2023.

The decrease was a result of our average occupancy decreasing from 90.2% to 89.3%, resulting in a decrease of approximately $7.1 million, partially offset by our average revenue per square foot increasing by approximately $0.25, contributing approximately $3.5 million.

Termination Income

Termination income increased by approximately $0.4 million for the three months ended September 30, 2023 compared to 2022.

Termination income for the three months ended September 30, 2023 related to nine clients across the Same Property Portfolio and totaled approximately $2.3 million, which was primarily related to clients that terminated leases early in Seattle.

Termination income for the three months ended September 30, 2022 related to nine clients across the Same Property Portfolio and totaled approximately $2.0 million, which was primarily related to clients that terminated leases early in San Francisco.

Termination income increased by approximately $1.6 million for the three months ended March 31, 2024 compared to 2023.

Termination income for the three months ended March 31, 2024 related to ten clients across the Same Property Portfolio and totaled approximately $1.8 million, which was primarily related to clients that terminated leases early in San Francisco, California.

Termination income for the three months ended March 31, 2023 related to seven clients across the Same Property Portfolio and totaled approximately $0.2 million, which was primarily related to clients that terminated leases early in New York City.

Parking and Other Revenue

Parking and other revenue increased by approximately $5.0 million for the three months ended September 30, 2023 compared to 2022.

Parking and other revenue increased by approximately $5.1 million for the three months ended March 31, 2024 compared to 2023.

Parking and other revenue increased by approximately $0.5 million and $4.6 million, respectively.

The increase in parking revenue was primarily due to an increase in transient and monthly parking.

The increase in other revenue was primarily associated with the View Boston observatory, which was completed and placed in-service on June 1, 2023.

Real Estate Operating Expenses

Real estate operating expenses from the Same Property Portfolio increased by approximately $18.0 million, or 6.7%, for the three months ended September 30, 2023 compared to 2022, due primarily to increases in real estate taxes of approximately $4.2 million, or 3.2%, and other real estate operating expenses of approximately $10.5 million, or 7.7%.

The increase in real estate taxes was primarily in Boston.

Real estate operating expenses from the Same Property Portfolio increased by approximately $12.5 million, or 4.5%, for the three months ended March 31, 2024 compared to 2023, due primarily to increases in repairs and maintenance of approximately $3.7 million, or 8.4%, and other real estate operating expenses of approximately $4.9 million, or 2.1%.

The increase in repairs and maintenance was primarily in Boston.

In addition, there was approximately $3.9 million related to the marketing and operating expenses associated with the View Boston observatory, which was completed and placed in-service on June 1, 2023.

Properties Acquired Portfolio

The table below lists the properties acquired between July 1, 2022 and September 30, 2023.

Rental revenue and real estate operating expenses increased by approximately $8.6 million and $0.8 million, respectively, for the three months ended September 30, 2023 compared to 2022, as detailed below.

The table below lists the properties acquired between January 1, 2023 and March 31, 2024.

Rental revenue and real estate operating expenses increased by approximately $28.2 million and $9.6 million, respectively, for the three months ended March 31, 2024 compared to 2023, as detailed below.

Square Feet Rental Revenue Real Estate Operating Expenses

1 unchanged sentence

(dollars in thousands)

125 Broadway September 16, 2022 271,000 $ 10,225 $ 1,622 $ 8,603 $ 1,007 $ 208 $ 799

Santa Monica Business Park (1) December 14, 2023 1,182,696 $ 20,401 $ — $ 20,401 $ 6,569 $ — $ 6,569

901 New York Avenue January 8, 2024 523,939 7,800 — 7,800 3,008 — 3,008

1,706,635 $ 28,201 $ — $ 28,201 $ 9,577 $ — $ 9,577

______________

(1) Rental revenue for the three months ended March 31, 2024 includes approximately $0.2 million of termination income.

Properties Placed In-Service Portfolio

The table below lists the properties that were placed in-service or partially placed in-service between July 1, 2022 and September 30, 2023.

Rental revenue and real estate operating expenses from our Properties Placed In-Service Portfolio increased by approximately $15.0 million and $5.0 million, respectively, for the three months ended September 30, 2023 compared to 2022, as detailed below.

The table below lists the properties that were placed in-service or partially placed in-service between January 1, 2023 and March 31, 2024.

Rental revenue and real estate operating expenses from our Properties Placed In-Service Portfolio increased by approximately $7.8 million and $3.2 million, respectively, for the three months ended March 31, 2024 compared to 2023, as detailed below.

Quarter Initially Placed In-Service Quarter Fully Placed In-Service Rental Revenue Real Estate Operating Expenses

1 unchanged sentence

(dollars in thousands)

Reston Next Fourth Quarter, 2021 Fourth Quarter, 2022 1,063,296 $ 11,605 $ 9,051 $ 2,554 $ 4,178 $ 2,830 $ 1,348

2100 Pennsylvania Avenue Second Quarter, 2022 Second Quarter, 2023 475,849 $ 7,924 $ 5,141 $ 2,783 $ 2,721 $ 1,727 $ 994

880 Winter Street (1) Third Quarter, 2022 Fourth Quarter, 2022 243,618 6,505 684 5,821 1,443 376 1,067

140 Kendrick Street - Building A Third Quarter, 2023 Third Quarter, 2023 104,166 1,925 — 1,925 592 — 592

180 CityPoint Third Quarter, 2023 N/A 329,000 3,074 — 3,074 1,389 — 1,389

2,215,929 $ 24,945 $ 9,896 $ 15,049 $ 8,758 $ 3,714 $ 5,044

103 CityPoint Fourth Quarter, 2023 N/A 113,000 — — — 261 — 261

1,022,015 $ 12,923 $ 5,141 $ 7,782 $ 4,963 $ 1,727 $ 3,236

(1) Conversion of a 224,000 square foot office property located in Waltham, Massachusetts to laboratory space.

Rental revenue for the three months ended September 30, 2023 includes approximately $0.2 million of termination income.

Properties in or Held for Development or Redevelopment Portfolio

The table below lists the properties that were in or held for development or redevelopment between July 1, 2022 and September 30, 2023.

Rental revenue and real estate operating expenses from our Properties in or Held for Development or Redevelopment Portfolio decreased by approximately $1.8 million and $1.9 million, respectively, for the three months ended September 30, 2023 compared to 2022, as detailed below.

The table below lists the properties that were in or held for development or redevelopment between January 1, 2023 and March 31, 2024.

Rental revenue and real estate operating expenses from our Properties in or Held for Development or Redevelopment Portfolio decreased by approximately $0.2 million and $2.7 million, respectively, for the three months ended March 31, 2024 compared to 2023, as detailed below.

Rental Revenue Real Estate Operating Expenses

1 unchanged sentence

(dollars in thousands)

760 Boylston Street September 12, 2022 118,000 $ — $ — $ — $ — $ 180 $ (180)

105 Carnegie Center (1) November 30, 2022 73,000 $ — $ — $ — $ 155 $ — $ 155

2096 Gaither Road December 1, 2022 50,000 — 53 (53) 35 105 (70)

RTC Next-Hotel (1) December 19, 2022 N/A 233 — 233 — — —

Kendall Center Blue Parking Garage (2) January 4, 2023 N/A — 25 (25) — 2,277 (2,277)

300 Binney Street January 30, 2023 236,000 — (900) 900 — 117 (117)

Shady Grove Innovation District (3) March 31, 2023 184,000 (45) 631 (676) 292 402 (110)

Lexington Office Park (3) March 31, 2023 167,000 257 629 (372) 417 611 (194)

2098 Gaither Road (3) March 31, 2023 50,000 37 146 (109) 125 99 26

1050 Winter Street (3) March 31, 2024 162,000 30 29 1 437 627 (190)

822,000 $ 242 $ 414 $ (172) $ 1,301 $ 4,034 $ (2,733)

______________

(1) On December 19, 2022, in accordance with GAAP, the ground lease that encumbers this property was reclassified as a sales-type lease and the associated assets were derecognized.

(1) On November 30, 2023, we elected to suspend redevelopment.

Although no longer in redevelopment, this property is not considered “in-service” as we are not actively leasing this property in anticipation of restarting redevelopment in the future.

(2) The Kendall Center Blue Parking Garage was taken out of service on January 4, 2023 to support the development of 290 Binney Street.

Real estate operating expenses for the three months ended September 30, 2023 included approximately ($0.7) million of demolition costs.

Properties Sold Portfolio

The table below lists the properties we sold between July 1, 2022 and September 30, 2023.

Rental revenue and real estate operating expenses from our Properties Sold Portfolio decreased by approximately $9.6 million and $3.3 million, respectively, for the three months ended September 30, 2023 compared to 2022, as detailed below.

Rental Revenue Real Estate Operating Expenses

Name Date Sold Property Type Square Feet 2023 2022 Change 2023 2022 Change

(dollars in thousands)

601 Massachusetts Avenue August 30, 2022 Office 478,667 $ — $ 7,054 $ (7,054) $ — $ 2,260 $ (2,260)

Total Office 478,667 — 7,054 (7,054) — 2,260 (2,260)

The Avant at Reston Town Center (1) November 8, 2022 Residential 329,195 551 3,072 (2,521) 159 1,233 (1,074)

Total Residential 329,195 551 3,072 (2,521) 159 1,233 (1,074)

807,862 $ 551 $ 10,126 $ (9,575) $ 159 $ 3,493 $ (3,334)

______________

(1) We retained and continue to own approximately 26,000 square feet of ground-level retail space.

Rental Revenue and Real Estate Operating Expenses for the three months ended September 30, 2023 represent the ground-level retail space.

Rental Revenue and Real Estate Operating Expenses for the three months ended September 30, 2022 represent the entire property and not just the portion sold.

Real estate operating expenses for the three months ended March 31, 2023 included approximately $2.3 million of demolition costs.

(3) A portion of Shady Grove Innovation District, Lexington Office Park and 1050 Winter Street are no longer considered “in-service” because each property’s occupied percentage is less than 50% and we are no longer actively leasing the properties in anticipation of a future development/redevelopment.

This portion of Shady Grove Innovation District is comprised of three buildings, 2092 and 2098 Gaither Road and 15825 Shady Grove Road that were taken out of service between March 31, 2023 and March 31, 2024.

Residential Net Operating Income

Net operating income for our residential same properties increased by approximately $0.6 million for the three months ended September 30, 2023 compared to 2022.

The following reflects our occupancy and rate information for our residential same properties for the three months ended September 30, 2023 and 2022.

Net operating income for our residential same properties increased by approximately $0.7 million for the three months ended March 31, 2024 compared to 2023.

The following reflects our occupancy and rate information for our residential same properties for the three months ended March 31, 2024 and 2023.

Average Monthly Rental Rate (1) Average Rental Rate Per Occupied Square Foot Average Physical Occupancy (2) Average Economic Occupancy (3)

11 unchanged sentences

“Market Rents” used by us in calculating Average Economic Occupancy are based on the current market rates set by the managers of our residential properties based on their experience in renting their residential property’s units and publicly available market data.

Actual market rents and trends in such rents for a region as reported by others may vary materially from Market Rents used by us.

1 unchanged sentence

Hotel Net Operating Income

The Boston Marriott Cambridge hotel had net operating income of approximately $4.5 million for the three months ended September 30, 2023, representing an increase of approximately $1.3 million compared to the three months ended September 30, 2022.

The following reflects our occupancy and rate information for the Boston Marriott Cambridge hotel for the three months ended September 30, 2023 and 2022.

The Boston Marriott Cambridge hotel had net operating income of approximately $2.2 million for the three months ended March 31, 2024, representing an increase of approximately $0.7 million compared to the three months ended March 31, 2023.

The following reflects our occupancy and rate information for the Boston Marriott Cambridge hotel for the three months ended March 31, 2024 and 2023.

Occupancy 71.0 % 61.3 % 15.8 %

3 unchanged sentences

Development and Management Services Revenue

Development and management services revenue increased by approximately $1.8 million for the three months ended September 30, 2023 compared to 2022.

Development services revenue and management services revenue increased by approximately $0.7 million and $1.1 million, respectively.

The increase in development management services revenue was primarily related to an increase in development fees from unconsolidated joint ventures in the Washington, DC region.

The increase in management services revenue was primarily related to an increase in property management fees earned from an unconsolidated joint venture in New York City and asset management fees earned from an unconsolidated joint venture in the Los Angeles region.

Development and management services revenue decreased by approximately $2.8 million for the three months ended March 31, 2024 compared to 2023.

Development services revenue and management services revenue decreased by approximately $1.2 million and $1.6 million, respectively.

The decrease in development services revenue was primarily related to a decrease in fees associated with a tenant improvement project in New York City.

The decrease in management services revenue was primarily related to a decrease in property and asset management fees earned from an unconsolidated joint venture in the Los Angeles region which we acquired the joint venture partner’s interest in December 2023.

General and Administrative Expense

General and administrative expense decreased by approximately $1.1 million for the three months ended September 30, 2023 compared to 2022 primarily due to decreases in compensation expense of approximately $1.3 million, partially offset by an approximately $0.2 million increase in other general and administrative expenses.

The decrease in compensation expense related to an approximately $0.7 million decrease in the value of our deferred compensation plan and an approximately $0.6 million decrease in other compensation expenses.

General and administrative expense decreased by approximately $5.8 million for the three months ended March 31, 2024 compared to 2023 primarily due to a decrease in compensation expense of approximately $6.1 million, partially offset by an approximately $0.3 million increase in other general and administrative expenses.

The decrease in compensation expense related to an approximately $6.7 million decrease in other compensation expenses partially offset by an approximately $0.6 million increase in the value of our deferred compensation plan.

Capitalized wages for the three months ended September 30, 2023 and 2022 were approximately $4.4 million and $3.9 million, respectively.

Capitalized wages for the three months ended March 31, 2024 and 2023 were approximately $4.1 million and $4.5 million, respectively.

These costs are not included in the general and administrative expenses discussed above.

Transaction Costs

Transaction costs decreased by approximately $0.9 million for the three months ended September 30, 2023 compared to 2022 due primarily to decreased costs incurred in connection with the pursuit and formation of new joint ventures during the three months ended September 30, 2022, that did not recur in 2023.

Transaction costs decreased by approximately $0.4 million for the three months ended March 31, 2024 compared to 2023 due primarily to decreased costs incurred in connection with the pursuit and formation of new joint ventures during the three months ended March 31, 2023, that did not recur in 2024.

In general, transaction costs relating to the formation of new joint ventures and the pursuit of other transactions are expensed as incurred.

4 unchanged sentences

For additional information see the Explanatory Note that immediately follows the cover page of this Quarterly Report on Form 10-Q.

Depreciation and amortization expense increased by approximately $16.8 million for the three months ended September 30, 2023 compared to 2022, as detailed below.

Portfolio Depreciation and Amortization for the three months ended September 30,

Depreciation and amortization expense increased by approximately $10.0 million for the three months ended March 31, 2024 compared to 2023, as detailed below.

Portfolio Depreciation and Amortization for the three months ended March 31,

2024 2023 Change

4 unchanged sentences

Properties in or Held for Development or Redevelopment Portfolio (1) 561 13,176 (12,615)

Properties Sold Portfolio 112 1,861 (1,749)

$ 218,716 $ 208,734 $ 9,982

Depreciation and amortization expense increased by approximately $16.7 million for the three months ended September 30, 2023 compared to 2022, as detailed below.

Portfolio Depreciation and Amortization for the three months ended September 30,

______________

(1) During the three months ended March 31, 2023, the Kendall Center Blue Parking Garage was taken out of service and demolished to support the development of 290 Binney Street, an approximately 566,000 net rentable square foot laboratory/life sciences project in Cambridge, Massachusetts.

As a result, during the three months ended March 31, 2023, we recorded approximately $0.8 million of accelerated depreciation expense for the demolition of the garage, of which approximately $0.2 million related to the step-up of real estate assets.

Depreciation and amortization expense increased by approximately $10.1 million for the three months ended March 31, 2024 compared to 2023, as detailed below.

Portfolio Depreciation and Amortization for the three months ended March 31,

2024 2023 Change

4 unchanged sentences

Properties in or Held for Development or Redevelopment Portfolio (1) 561 12,996 (12,435)

Properties Sold Portfolio 112 1,861 (1,749)

$ 217,019 $ 206,872 $ 10,147

______________

As a result, during the three months ended March 31, 2023, we recorded approximately $0.6 million of accelerated depreciation expense for the demolition of the garage.

Direct Reimbursements of Payroll and Related Costs From Management Services Contracts and Payroll and Related Costs From Management Service Contracts

2 unchanged sentences

Other Income and Expense Items

Loss from Unconsolidated Joint Ventures

For the three months ended September 30, 2023 compared to 2022, loss from unconsolidated joint ventures increased by approximately $244.0 million primarily due to non-cash impairment charges related to our investments in 360 Park Avenue South, 200 Fifth Avenue, Platform 16, and Safeco Plaza of approximately $54.0 million, $33.4 million, $155.2 million, and $29.9 million, respectively, partially offset by an approximately $35.8 million gain on investment related to our Metropolitan Square joint venture interest (See Note 5 to the Consolidated Financial Statements).

Gains on Sales of Real Estate

This accounting resulted in a step-up of the real estate assets at BXP that was allocated to certain properties.

estate when those properties are sold.

For additional information, see the Explanatory Note that immediately follows the cover page of this Quarterly Report on Form 10-Q.

Gains on sales of real estate decreased by approximately $261.8 million for the three months ended September 30, 2023 compared to 2022, as detailed below.

Name Date Sold Property Type Square Feet Sale Price Net Cash Proceeds Gain on Sale of Real Estate

(dollars in millions)

N/A $ — $ — $ — (1)

601 Massachusetts Avenue August 30, 2022 Office 478,667 $ 531.0 $ 512.3 $ 237.4

Broadrun Land Parcel September 15, 2022 Land N/A 27.0 25.6 24.4

$ 558.0 $ 537.9 $ 261.8 (2)

(1) Excludes approximately $0.5 million of gains on sales of real estate recognized during the three months ended September 30, 2023 related to gain amounts from sales of real estate occurring in prior periods.

(2) Excludes approximately $0.5 million of gains on sales of real estate recognized during the three months ended September 30, 2022 related to gain amounts from sales of real estate occurring in prior periods.

Gains on sales of real estate decreased by approximately $261.8 million for the three months ended September 30, 2023 compared to 2022, as detailed below.

Name Date Sold Property Type Square Feet Sale Price Net Cash Proceeds Gain on Sale of Real Estate

(dollars in millions)

N/A $ — $ — $ — (1)

601 Massachusetts Avenue August 30, 2022 Office 478,667 $ 531.0 $ 512.3 $ 237.5

Broadrun Land Parcel September 15, 2022 Land N/A 27.0 25.6 24.4

$ 558.0 $ 537.9 $ 261.9 (2)

(2) Excludes approximately $0.4 million of gains on sales of real estate recognized during the three months ended September 30, 2022 related to gain amounts from sales of real estate occurring in prior periods.

Income (Loss) from Unconsolidated Joint Ventures

For the three months ended March 31, 2024 compared to 2023, income (loss) from unconsolidated joint ventures increased by approximately $26.8 million primarily due to an approximately $21.8 million gain on consolidation related to the acquisition of our joint venture partner’s economic interest in the joint venture that owns 901 New York Avenue during the three months ended March 31, 2024 (See Note 5 to the Consolidated Financial Statements).

Interest and Other Income (Loss)

Interest and other income (loss) increased by approximately $17.0 million for the three months ended September 30, 2023 compared to 2022, due primarily to an increase of approximately $17.1 million in interest income from increased interest earned on our deposits partially offset by an increase in our allowance for current expected credit losses of approximately $0.1 million.

Losses from Investments in Securities

Losses from investments in securities for the three months ended September 30, 2023 and 2022 related to investments that we have made to reduce our market risk relating to deferred compensation plans that we maintain for BXP’s officers and former non-employee directors.

Under the deferred compensation plans, each officer or non-employee director who is eligible to participate is permitted to defer a portion of the officer’s current income or the

non-employee director’s compensation on a pre-tax basis and receive a tax-deferred return on these deferrals based on the performance of specific investments selected by the officer or non-employee director.

Interest and other income (loss) increased by approximately $3.6 million for the three months ended March 31, 2024 compared to 2023, due primarily to an increase in interest income from increased interest earned on our deposits.

Gains from Investments in Securities

Gain from investments in securities for the three months ended March 31, 2024 and 2023 related to investments that we have made to reduce our market risk relating to deferred compensation plans that we maintain for BXP’s officers and former non-employee directors.

This enables us to generally match our liabilities to BXP’s officers or former non-employee directors under our deferred compensation plans with equivalent assets and thereby limit our market risk.

The performance of these investments is recorded as losses from investments in securities.

During the three months ended September 30, 2023 and 2022, we recognized losses of approximately $0.9 million and $1.6 million, respectively, on these investments.

By comparison, our general and administrative expense decreased by approximately $0.9 million and $1.6 million during the three months ended September 30, 2023 and 2022, respectively, as a result of decreases in our liability under our deferred compensation plans that was associated with the performance of the specific investments selected by officers and former non-employee directors of BXP participating in the plans.

Unrealized Loss on Non-Real Estate Investment

During the year ended December 31, 2022, we began investing in non-real estate investments, which are primarily environmentally-focused investment funds.

As a result, for the three months ended September 30, 2023, we recognized an unrealized loss of approximately $51,000 due to the observable changes in the fair value of the investments.

The performance of these investments is recorded as gains from investments in securities.

During the three months ended March 31, 2024 and 2023, we recognized gains of approximately $2.3 million and $1.7 million, respectively, on these investments.

By comparison, our general and administrative expense increased by approximately $2.3 million and $1.7 million during the three months ended March 31, 2024 and 2023, respectively, as a result of increases in our liability under our deferred compensation plans that was associated with the performance of the specific investments selected by officers and former non-employee directors of BXP participating in the plans.

Unrealized Gain on Non-Real Estate Investment

We invest in non-real estate investments, which are primarily environmentally-focused investment funds.

As a result, for the three months ended March 31, 2024 and 2023, we recognized an unrealized gain of approximately $0.4 million and $0.3 million, respectively, due to the observable changes in the fair value of the investments.

Impairment Loss

At March 31, 2024, we evaluated the expected hold period for a portion of our Shady Grove property located in Rockville, Maryland.

As a result, each of BXP and BPLP recognized an impairment loss of approximately $13.6 million.

Our estimated fair value was based on Level 3 inputs as defined in ASC 820 and on a pending offer from a third party.

Interest Expense

Interest expense increased by approximately $36.0 million for the three months ended September 30, 2023 compared to 2022, as detailed below.

Component Change in interest expense for the three months ended September 30, 2023 compared to September 30, 2022

Interest expense increased by approximately $27.7 million for the three months ended March 31, 2024 compared to 2023, as detailed below.

Component Change in interest expense for the three months ended March 31, 2024 compared to March 31, 2023

(in thousands)

Increases to interest expense due to:

Issuance of $750 million in aggregate principal of 6.750% senior notes due 2027 on November 17, 2022 $ 12,675

New mortgage loan financings (1) $ 20,598

Issuance of $750 million in aggregate principal of 6.500% senior notes due 2034 on May 15, 2023 12,227

Increase in interest associated with unsecured term loans and unsecured credit facility, net 9,347

Increase in interest due to finance lease for one in-service property 2,879

Amortization expense of financing fees primarily related to unsecured term loan 348

Other interest expense (excluding senior notes) 66

Increase in interest due to finance leases 2,291

Decrease in capitalized interest related to development projects 1,262

Amortization expense of financing fees 481

Total increases to interest expense 36,859

Decreases to interest expense due to:

Repayment of $700 million in aggregate principal of 3.800% senior notes due 2024 on February 1, 2024 (4,471)

Repayment of $500 million in aggregate principal of 3.125% senior notes due 2023 on September 1, 2023 (3,991)

Increase in capitalized interest related to development projects (273)

Decrease in interest associated with unsecured term loans and the unsecured credit facility, net (709)

Other interest expense (excluding senior notes) (4)

Total decreases to interest expense (9,175)

Total change in interest expense $ 27,684

______________

(1) Consists of the mortgage loan collateralized by the 325 Main Street, 355 Main Street, 90 Broadway and Cambridge East Garage (also known as Kendall Center Green Garage) properties located in Cambridge, Massachusetts, and the mortgage loan and fair value debt and swap adjustments for Santa Monica Business Park located in Santa Monica, California and 901 New York Avenue in Washington, DC (See Note 6 to the Consolidated Financial Statements).

As portions of properties are placed in-service, we cease capitalizing interest on that portion and interest is then expensed.

Interest capitalized for the three months ended September 30, 2023 and 2022 was approximately $9.7 million and $12.2 million, respectively.

Interest capitalized for the three months ended March 31, 2024 and 2023 was approximately $9.4 million and $10.6 million, respectively.

These costs are not included in the interest expense referenced above.

At September 30, 2023, our variable rate debt consisted of BPLP’s $1.815 billion Revolving Facility under its 2021 Credit Facility and $1.2 billion 2023 Unsecured Term Loan.

As of September 30, 2023, the Revolving Facility did not have a balance outstanding and the 2023 Unsecured Term Loan had $1.2 billion outstanding.

At March 31, 2024, our variable rate debt consisted of (1) BPLP’s $1.815 billion 2021 Credit Facility, (2) BPLP’s $1.2 billion 2023 Unsecured Term Loan and (3) $900 million of mortgage notes collateralized by Santa Monica Business Park and our 325 Main Street, 355 Main Street, 90 Broadway and Kendall Center Green Garage properties.

As of March 31, 2024, the 2021 Credit Facility did not have a balance outstanding.

The other variable rate debt has all been hedged with interest rates swaps to fix SOFR for all, or a portion of the applicable debt term.

For a summary of our consolidated debt as of March 31, 2024 refer to the heading “ Liquidity and Capital Resources—Debt Financing” within “ Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Noncontrolling Interests in Property Partnerships

Noncontrolling interests in property partnerships increased by approximately $2.1 million for the three months ended September 30, 2023 compared to 2022, as detailed below.

Property Noncontrolling Interests in Property Partnerships for the three months ended September 30,

Noncontrolling interests in property partnerships decreased by approximately $1.4 million for the three months ended March 31, 2024 compared to 2023, as detailed below.

Property Noncontrolling Interests in Property Partnerships for the three months ended March 31,

2024 2023 Change

6 unchanged sentences

343 Madison Avenue (2) — — —

300 Binney Street (3) 5 — 5

290 Binney Street (4) 10 — 10

$ 17,221 $ 18,660 $ (1,439)

_______________

(1) The increase was primarily attributable to an increase in lease revenue from our clients.

(2) 343 Madison Avenue is held for future development (See Notes 4 and 9 to the Consolidated Financial Statements).

(1) The decrease was primarily attributable to a decrease in lease revenue from our clients.

(2) Property is held for future development.

(3) Property is currently under redevelopment.

(4) Property is currently in development (See Note 9 to the Consolidated Financial Statements).

Noncontrolling Interest—Common Units of the Operating Partnership

For BXP, noncontrolling interest—common units of the Operating Partnership decreased by approximately $53.5 million for the three months ended September 30, 2023 compared to 2022 due primarily to a decrease in allocable income, which included recognizing a greater gain on sales of real estate during 2022.

For BXP, noncontrolling interest—common units of the Operating Partnership increased by approximately $0.4 million for the three months ended March 31, 2024 compared to 2023 due primarily to an increase in allocable income.

Due to our ownership structure, there is no corresponding line item on BPLP’s financial statements.

2 unchanged sentences

• fund normal recurring expenses;

• meet debt service and principal repayment obligations and balloon payments on maturing debt, including the $1.2 billion Unsecured Term Loan maturing May 16, 2024 (unless we exercise the one-year extension option, subject to certain conditions) and $700 million of 3.800% unsecured senior notes due February 1, 2024;

• meet debt service and principal repayment obligations and balloon payments on maturing debt, including the $700.0 million outstanding on the 2023 Unsecured Term Loan, the maturity date of which we intend to extend to May 16, 2025, $850.0 million of 3.200% unsecured senior notes due January 15, 2025 and amounts that become due under BPLP’s commercial paper program;

• fund development and redevelopment costs;

• fund capital expenditures, including major renovations, tenant improvements and leasing costs;

• fund pending and possible acquisitions of properties, either directly or indirectly through the acquisition of equity interests;

• fund possible acquisitions of properties, either directly or indirectly through the acquisition of equity interests;

• make the minimum distribution required to enable BXP to maintain its REIT qualification under the Internal Revenue Code of 1986, as amended.

3 unchanged sentences

• cash and cash equivalent balances;

• borrowings under BPLP’s Revolving Facility, unsecured term loans, short-term bridge facilities and construction loans;

• borrowings under BPLP’s 2021 Credit Facility, unsecured term loans, short-term bridge facilities and construction loans;

• long-term secured and unsecured indebtedness (including unsecured exchangeable indebtedness);

• sales of real estate and interests in joint ventures owning real estate;

• private equity sources, including with large institutional investors;

• private equity sources, including institutional investors;

• issuances of BXP equity securities and/or preferred or common units of partnership interests in BPLP.

We draw on multiple financing sources to fund our long-term capital needs.

We expect to fund our current development/redevelopment properties primarily with our available cash balances, funding from institutional private equity partners, construction loans, unsecured term loans, proceeds from asset sales and BPLP’s Revolving Facility.

We use BPLP’s Revolving Facility primarily as a bridge facility to fund acquisition opportunities, refinance outstanding indebtedness and meet short-term development and working capital needs.

We expect to fund our current development/redevelopment properties primarily with our available cash balances, funding from institutional private equity partners, construction loans, unsecured term loans, and proceeds from possible asset sales, BPLP’s 2021 Credit Facility and BPLP's commercial paper program.

We use BPLP’s 2021 Credit Facility primarily as a bridge facility to fund acquisition opportunities, refinance outstanding indebtedness and meet short-term development and working capital needs.

Although we may seek to fund our development projects with construction loans, which may require guarantees by BPLP, the financing for each particular project ultimately depends on several factors, including, among others, the project’s size and duration, whether the project is owned by a joint venture, the extent of pre-leasing, our available cash and access to cost effective capital at the given time.

The following table presents information on properties under construction/redevelopment as of September 30, 2023 (dollars in thousands):

Construction/Redevelopment Properties Estimated Stabilization Date Location # of Buildings Estimated Square Feet Investment to Date (1)(2)(3) Estimated Total Investment (1)(2) Total Available (1) Outstanding at September 30, 2023

The following table presents information on properties under construction/redevelopment as of March 31, 2024 (dollars in thousands):

Estimated Future Equity Requirement (1)(2)(4) Percentage Leased (5)

360 Park Avenue South (42% ownership) Q4 2025 New York, NY 1 450,000 $ 207,253 $ 248,000 $ 92,774 $ 92,768 $ 40,741 18 % (6)

360 Park Avenue South (71% ownership) (Redevelopment) Q4 2025 New York, NY 1 450,000 $ 332,077 $ 418,300 $ 156,470 $ 156,470 $ 86,223 23 %

Reston Next Office Phase II Q4 2025 Reston, VA 1 90,000 40,956 61,000 — — 20,044 4 %

3 unchanged sentences

180 CityPoint Q3 2025 Waltham, MA 1 329,000 224,356 290,500 — — 66,144 43 % (7)

300 Binney Street (Redevelopment) Q1 2025 Cambridge, MA 1 236,000 39,049 205,300 — — 166,251 100 %

105 Carnegie Center (Redevelopment) Q2 2025 Princeton, NJ 1 73,000 2,062 40,600 — — 38,538 — %

300 Binney Street (55% ownership) (Redevelopment) Q1 2025 Cambridge, MA 1 236,000 5,211 112,900 — — 107,689 100 % (8)

651 Gateway (50% ownership) (Redevelopment) Q4 2025 South San Francisco, CA 1 327,000 116,103 167,100 — — 50,997 21 % (9)

290 Binney Street Q2 2026 Cambridge, MA 1 566,000 210,885 1,116,300 — — 905,415 100 %

290 Binney Street (55% ownership) Q2 2026 Cambridge, MA 1 566,000 205,977 508,000 — — 302,023 100 % (10)

Total Laboratory/Life Sciences Properties under Construction/Redevelopment 5 1,571,000 640,921 1,193,600 — — 552,679 64 %

Skymark - Reston Next Residential (508 units) (20% ownership) Q2 2026 Reston, VA 1 417,000 36,744 47,700 28,000 18,153 1,109 3 %

121 Broadway Street (439 units) Q2 2029 Cambridge, MA 1 492,000 45,891 597,800 — — 551,909 — %

Total Residential Property under Construction 2 909,000 82,635 645,500 28,000 18,153 553,018 1 %

4 unchanged sentences

(1) Represents our share.

(2) Each of Investment to Date, Estimated Total Investment and Estimated Future Equity Requirement represent our share of acquisition expenses, as applicable, and reflect our share of the estimated net revenue/expenses that we expect to incur prior to stabilization of the project, including any amounts actually received or paid through September 30, 2023.

(3) Includes approximately $73.6 million of unpaid but accrued construction costs and leasing commissions.

(4) Excludes approximately $73.6 million of unpaid but accrued construction costs and leasing commissions.

(5) Represents percentage leased as of October 30, 2023, including leases with future commencement dates.

(6) Investment to Date includes all related costs incurred prior to the contribution of the property by us to the joint venture on December 15, 2021 totaling approximately $107 million and our proportionate share of the loan.

Our joint venture partners will fund required capital until their aggregate investment is approximately 58% of all capital contributions;

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

Investment to date excludes approximately $54.0 million of an impairment charge.

(7) As of September 30, 2023, this property was 5% placed in-service.

(8) Percentage leased excludes the residential property.

Lease revenue (which includes reimbursement of operating expenses from clients, if any), other income from operations, available cash balances, proceeds from mortgage financings and offerings of unsecured indebtedness, draws on BPLP’s Revolving Facility, and funding from institutional private equity partners are the principal sources of capital that we use to fund operating expenses, debt service, maintenance and repositioning capital expenditures, tenant improvements and the minimum distribution required to enable BXP to maintain its REIT qualification.

(5) Represents percentage leased as of May 2, 2024, including leases with future commencement dates.

(6) As of March 31, 2024, this property was 4% placed in-service.

(7) As of March 31, 2024, this property was 46% placed in-service.

(8) The institutional investor funded approximately $212.9 million at closing for its investment in 300 Binney Street.

We withdrew approximately $212.9 million at closing and will fund all future costs of the project.

(9) As of March 31, 2024, this property was 14% placed in-service.

(10) On March 21, 2024, we completed the sale of a 45% interest in 290 Binney Street (See Note 9 to the Consolidated Financial Statements).

The project budget reflects our 55% share of joint venture costs related to 290 Binney Street.

We have the sole obligation to construct an underground electrical vault for an estimated gross cost of $183.9 million.

We have entered into a contract to sell the electrical vault to a third party for a fixed price of $84.1 million upon completion.

The net investment of $99.8 million will be included in our outside basis in 290 Binney Street.

We have invested $40.5 million for the vault as of March 31, 2024.

(11) Percentage leased excludes the residential properties.

Lease revenue (which includes reimbursement of operating expenses from clients, if any), other income from operations, available cash balances, proceeds from mortgage financings, offerings of unsecured indebtedness and BPLP's commercial paper program, draws on BPLP’s 2021 Credit Facility, and funding from institutional private equity partners are the principal sources of capital that we use to fund operating expenses, debt service, development and redevelopment activities, maintenance and repositioning capital expenditures, tenant improvements and the minimum distribution required to enable BXP to maintain its REIT qualification.

We seek to maximize income from our existing properties by maintaining quality standards for our properties that promote high occupancy rates and permit increases in rental rates while reducing client turnover and controlling operating expenses.

Our sources of revenue also include third-party fees generated by our property management, leasing, development and construction businesses, as well as the sale of assets from time to time.

Our sources of revenue also include third-party fees generated by our property management, leasing, development and construction businesses, interest earned on cash deposits and, from time to time, the sale of assets.

We believe these sources of capital will continue to provide the funds necessary for our short-term liquidity needs.

1 unchanged sentence

We expect our primary uses of capital over the next twelve months will be to fund our current and committed development and redevelopment projects, repay debt maturities (as discussed below), make interest payments on our outstanding indebtedness, and satisfy our REIT distribution requirements.

As of September 30, 2023, we had 11 properties under development or redevelopment.

As of March 31, 2024, we had 11 properties under development or redevelopment.

Our share of the estimated total investment for these projects is approximately $2.6 billion, of which approximately $1.4 billion remains to be funded primarily with equity through 2027.

In the third quarter of 2023, we completed the development/redevelopment of:

• 140 Kendrick Street - Building A, a premier workplace redevelopment project with approximately 104,000 net rentable square feet located in Needham, Massachusetts.

The property is the first Net Zero, Carbon Neutral office repositioning of its scale in Massachusetts.

The property is 100% leased.

• 751 Gateway, an approximately 231,000 net rentable square foot laboratory/life sciences property in South San Francisco, California.

The property is 100% leased.

On July 28, 2023, we entered into a joint venture agreement with an institutional investor for the future development of 343 Madison Avenue located on Madison Avenue between 44th and 45th Streets in New York City, New York adjacent to Grand Central Station.

We own a 55% interest in the venture and our partner owns a 45% interest, and we will provide customary development, property management, and leasing services.

The 343 Madison Avenue project contemplates the construction of Phase 1 and Phase 2 (See Note 4 to the Consolidated Financial Statements).

Subsequently, on August 1, 2023, the joint venture executed an up to 99-year ground lease with the Metropolitan Transportation Authority for the approximately 25,000 square foot site.

Since June 30, 2023, we further strengthened our balance sheet by addressing the remaining 2023 debt maturities, and sourcing additional liquidity in the bank market.

On April 5, 2024, we completed and fully placed into service 760 Boylston Street, an approximately 118,000 net rentable square foot retail redevelopment located in Boston, Massachusetts.

During the first quarter of 2024, we further strengthened our balance sheet through sourcing additional liquidity and reducing our debt obligations.

Notable transactions include:

• We exercised a portion of the Accordion with three new lenders to the 2021 Credit Facility and entered into a lender agreement with each of the New Lenders to provide an aggregate of $315.0 million in additional revolving credit commitments, which increased the current maximum borrowing amount under the 2021 Credit Facility from $1.5 billion to $1.815 billion.

• A joint venture in which we have a 50% interest exercised an option to extend by one year the maturity date of its loan collateralized by 100 Causeway in Boston, Massachusetts.

The approximately 635,000 square foot premier workplace located in Boston, Massachusetts is approximately 95% leased as of September 30, 2023.

After making an approximately $4.0 million principal repayment, the modified and extended loan had an outstanding balance of $336.6 million and the interest rate was reduced from Term SOFR plus 1.60% to Term SOFR plus 1.48% per annum.

The loan now matures on September 5, 2024, with a one-year extension option, subject to certain conditions.

• A joint venture in which we have a 50% interest modified the loan collateralized by its Hub on Causeway - Podium property located in Boston, Massachusetts.

The modified loan now matures on September 8, 2025, with a one-year extension option, subject to certain conditions.

After making an approximately $20.0 million repayment, the modified loan had an outstanding balance of $154.3 million.

The interest rate changed from Term SOFR plus 2.35% per annum to Daily SOFR plus 2.50% per annum.

The joint venture entered into

interest rate swap contracts resulting in a weighted-average fixed rate of approximately 7.35% per annum through September 8, 2025.

• A joint venture in which we have a 25% interest exercised its second extension option with the lender, an affiliate of ours, under the land loan collateralized by the land and improvements at its 3 Hudson Boulevard property located in New York, New York.

The land loan now matures on February 9, 2024.

• We completed the repayment of $500.0 million in aggregate principal amount of 3.125% senior notes due September 1, 2023.

The repayment price was approximately $507.8 million, which included the entire principal amount plus approximately $7.8 million of accrued and unpaid interest.

The mortgage loan, totaling $600 million, requires interest-only payments at Daily Compounded SOFR plus 2.25% per annum until maturity on October 26, 2028.

We intend to use the net proceeds from this financing and available cash to repay the $700 million of 3.800% unsecured senior notes due February 1, 2024.

Our 2024 debt maturities include $700.0 million aggregate principal amount of BPLP’s 3.800% unsecured senior notes, which mature on February 1, 2024 and the $1.2 billion 2023 Unsecured Term Loan that matures on May 16, 2024 (unless we exercise the one-year extension option, subject to certain conditions).

In our unconsolidated joint venture portfolio, we have approximately $405.4 million (our share) of debt maturing in 2024.

We expect to fund the foregoing debt maturities using available cash balances, proceeds from asset sales, draws on BPLP’s Revolving Facility, exercising extension options, and/or through refinancings using secured debt, unsecured debt or both.

We expect our quarterly net interest expense will increase for the remainder of 2023 and into 2024 compared to the first nine months of 2023 primarily due to the cessation of capitalized interest on our 2023 development deliveries, higher interest rates on maturing debt that we refinance, and lower interest income as we use cash balances to repay debt and fund our development pipeline.

As of October 30, 2023, we had available cash of approximately $1.4 billion (of which approximately $93 million is attributable to our consolidated joint venture partners).

Our liquidity and capital resources depend on a wide range of factors, and we believe that our access to capital and our strong liquidity, including the approximately $1.8 billion available under BPLP’s Revolving Facility and our available cash, as of October 30, 2023, are sufficient to fund our remaining capital requirements on existing development and redevelopment projects, fund acquisitions, repay our maturing indebtedness when due (if not refinanced or extended), satisfy our REIT distribution requirements and still allow us to act opportunistically on attractive investment opportunities.

• On February 1, 2024, BPLP repaid at maturity its 3.800% unsecured senior notes at par utilizing the proceeds from a $600.0 million mortgage loan entered into on October 26, 2023 and available cash.

The repayment price was approximately $713.3 million, which included the stated principal of $700 million plus approximately $13.3 million of accrued and unpaid interest.

• On April 16, 2024, BPLP provided notice to exercise its one-year extension option on its 2023 Unsecured Term Loan.

BPLP anticipates effectuating the extension on or prior to the current May 16, 2024 maturity date.

Upon effectiveness, the 2023 Unsecured Term Loan will mature on May 16, 2025.

After making an approximately $500.0 million optional repayment on April 29, 2024 with the proceeds from BPLP's commercial paper program, the 2023 Unsecured Term Loan has an outstanding principal balance of $700.0 million.

• On April 17, 2024, BPLP established an unsecured commercial paper program.

Under the terms of the program, BPLP may issue, from time to time, unsecured commercial paper notes up to a maximum aggregate amount outstanding at any one time of $500.0 million with varying maturities of up to one year.

The notes will be sold in private placements and will rank pari passu with all of BPLP’s other unsecured senior indebtedness, including its outstanding senior notes.

The commercial paper program is backstopped by available capacity under the 2021 Credit Facility.

As of May 2, 2024, BPLP had $500.0 million outstanding under the commercial paper program that bears interest at a weighted-average rate of 5.58% per annum.

• On April 29, 2024, BPLP increased the current maximum borrowing amount under the 2021 Credit Facility from $1.815 billion to $2.0 billion.

All other terms of the 2021 Credit Facility, including its maturity date of June 15, 2026, remain unchanged.

BPLP had no borrowings under the 2021 Credit Facility as of May 2, 2024.

Our consolidated debt maturities through May 2025 include (1) $850.0 million aggregate principal amount of BPLP’s 3.200% unsecured senior notes due January 15, 2025, (2) $700.0 million 2023 Unsecured Term Loan that matures on May 16, 2025 upon effectiveness of our extension option, (3) approximately $202.2 million of mortgage debt secured by our 901 New York Avenue property located in Washington, DC maturing on January 5, 2025 (unless we exercise a four-year extension option, subject to certain conditions) and (4) amounts that become due under BPLP’s commercial paper program.

As of March 31, 2024, our unconsolidated joint venture portfolio have approximately $469.0 million (our share) of debt maturing through May 2, 2025.

We expect to fund the foregoing debt maturities using available cash

balances, proceeds from asset sales, draws on BPLP’s 2021 Credit Facility, proceeds from BPLP’s commercial paper program, secured debt or unsecured debt, or both.

We expect our net interest expense will increase in 2024 compared to 2023 primarily due to higher interest rates on outstanding debt and debt that we refinance, the impact of non-cash interest charges related to recent acquisitions, which included the assumption of below market debt, and lower interest income as we use cash balances to repay debt and fund our development pipeline.

As of May 2, 2024, we had available cash of approximately $502.5 million (of which approximately $125.9 million is attributable to our consolidated joint venture partners).

Our liquidity and capital resources depend on a wide range of factors, and we believe that our access to capital and our strong liquidity, including the approximately $2.0 billion available under BPLP’s 2021 Credit Facility, of which $500.0 million is being used as a backstop for the commercial paper program, and our available cash, as of May 2, 2024, are sufficient to fund our remaining capital needs on existing development and redevelopment projects, fund acquisitions, repay our maturing indebtedness when due (if not refinanced or extended), satisfy our REIT distribution requirements and still allow us to act opportunistically on attractive investment opportunities.

We may seek to enhance our liquidity to fund our current and future development activity, pursue additional attractive investment opportunities and refinance or repay indebtedness.

1 unchanged sentence

Doing so may result in us carrying additional cash and cash equivalents pending our use of the proceeds, which would increase our net interest expense.

On May 17, 2023, BXP renewed its 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.

Under the ATM stock offering program, BXP may also engage in forward sale transactions with affiliates of certain sales agents for the sale of its Common Stock on a forward basis.

BXP intends to use the net proceeds from any offering for general business purposes, which may include investment opportunities and debt reduction.

We have not sold any shares under this ATM stock offering program.

We have not sold any shares under BXP’s $600.0 million “at the market” equity offering program.

REIT Tax Distribution Considerations

10 unchanged sentences

The following summary discussion of our cash flows is based on the Consolidated Statements of Cash Flows and is not meant to be an all-inclusive discussion of the changes in our cash flows for the periods presented below.

Cash and cash equivalents and cash held in escrows aggregated approximately $930.4 million and $448.9 million at September 30, 2023 and 2022, respectively, representing an increase of approximately $481.6 million.

Cash and cash equivalents and cash held in escrows aggregated approximately $766.6 million and $964.3 million at March 31, 2024 and 2023, respectively, representing a decrease of approximately $197.6 million.

The following table sets forth changes in cash flows:

Nine months ended September 30,

Three months ended March 31,

2024 2023 Change

2 unchanged sentences

Net cash used in investing activities (286,619) (285,592) (1,027)

Net cash provided by financing activities 154,782 348,545 (193,763)

Net cash (used in) provided by financing activities (756,909) 279,052 (1,035,961)

Our principal source of cash flow is related to the operation of our properties.

The weighted-average term of our in-place leases, including leases signed by our unconsolidated joint ventures, excluding residential units, was approximately 7.6 years as of September 30, 2023, with occupancy rates historically in the range of 88% to 92%.

The weighted-average term of our in-place leases, including leases signed by our unconsolidated joint ventures, excluding residential units, was approximately 7.6 years as of March 31, 2024, with occupancy rates historically in the range of 88% to 92%.

Generally, our properties generate a relatively consistent stream of cash flow that provides us with resources to pay operating expenses, debt service and fund regular quarterly dividend and distribution payment requirements.

2 unchanged sentences

We selectively invest in new projects that enable us to take advantage of our development, leasing, financing and property management skills and invest in existing buildings to enhance or maintain our market position.

Cash used in investing activities for the nine months ended September 30, 2023 and September 30, 2022 is detailed below:

Nine months ended September 30,

Cash used in investing activities for the three months ended March 31, 2024 and March 31, 2023 is detailed below:

Three months ended March 31,

(in thousands)

Acquisitions of real estate (1) $ — $ (1,320,273)

Construction in progress (1) $ (181,636) $ (119,682)

1 unchanged sentence

Tenant improvements (53,377) (67,175)

Proceeds from sales of real estate (3) 517 695,231

Proceeds from assignment fee (4) — 6,624

Acquisition of real estate (net of cash received upon consolidation) (2) 6,086 —

Capital contributions to unconsolidated joint ventures (3) (26,457) (60,745)

Capital distributions from unconsolidated joint ventures (6) 7,350 36,622

Investment in non-real estate investments — (733)

Issuance of related party note receivable (7) (10,500) —

Proceeds from note receivable (8) — 10,000

Issuance of note receivables (including related party) (573) —

Investments in securities, net 1,425 1,843

1 unchanged sentence

Cash used in investing activities changed primarily due to the following:

(1) On September 16, 2022, we acquired 125 Broadway in Cambridge, Massachusetts for a net purchase price, including transaction costs, of approximately $592.4 million.

The acquisition was completed with available cash and borrowings under BPLP’s Revolving Facility.

125 Broadway is a 271,000 net rentable square foot, six-story, laboratory/life sciences property.

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

Madison Centre is an approximately 755,000 net rentable square foot, 37-story, LEED-Platinum certified, premier workplace.

(2) Construction in progress for the nine months ended September 30, 2023 included ongoing expenditures associated with 2100 Pennsylvania Avenue, 140 Kendrick Street Building A and the View Boston observatory at The Prudential Center, which were fully placed in-service during the nine months ended September 30, 2023 and 180 CityPoint that was partially placed in-service during the nine months ended September 30, 2023.

In addition, we incurred costs associated with our continued development/redevelopment of 103 CityPoint, Reston Next Office Phase II, 760 Boylston Street, 105 Carnegie Center, 290 Binney Street and 300 Binney Street.

Construction in progress for the nine months ended September 30, 2022 included ongoing expenditures associated with Reston Next, 2100 Pennsylvania Avenue and 880 Winter Street, each of which were partially placed in-service, and 325 Main Street, which was completed and fully placed in-service during the nine months ended September 30, 2022.

In addition, we incurred costs associated with our continued development/redevelopment of 180 CityPoint, View Boston observatory at The Prudential Center, 103 CityPoint, Reston Next Office Phase II, 140 Kendrick Street Building A and 760 Boylston Street.

(3) On September 15, 2022, we completed the sale of two parcels of land located in Loudoun County, Virginia for a gross sale price of $27.0 million.

Net cash proceeds totaled approximately $25.6 million, resulting in a gain on sale of real estate totaling approximately $24.4 million for BXP and BPLP.

On August 30, 2022, we completed the sale of 601 Massachusetts Avenue located in Washington, DC for a gross sale price of $531.0 million.

Net cash proceeds totaled approximately $512.3 million, resulting in a gain on sale of real estate totaling approximately $237.4 million for BXP and approximately $237.5 million for BPLP.

601 Massachusetts Avenue is an approximately 479,000 net rentable square foot premier workplace.

On June 15, 2022, we completed the sale of our 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.

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

Net cash proceeds totaled approximately $35.4 million, resulting in a gain on sale of real estate totaling approximately $22.7 million for BXP and approximately $23.4 million for BPLP.

195 West Street is an approximately 63,500 net rentable square foot premier workplace.

(4) On April 19, 2021, we 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, we executed an agreement to assign the 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.

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

The property was 100% leased.

(5) Capital contributions to unconsolidated joint ventures for the nine months ended September 30, 2023 consisted primarily of cash contributions of approximately $46.8 million, $32.8 million, $17.5 million, $14.4 million and $9.5 million to our Gateway Commons, Platform 16, Worldgate Drive, Dock 72 and 751 Gateway joint ventures, respectively.

(1) Construction in progress for the three months ended March 31, 2024 included ongoing expenditures associated with 180 CityPoint and 103 CityPoint that were partially placed in-service during 2023.

In addition, we incurred costs associated with our continued development/redevelopment of Reston Next Office Phase II, 760 Boylston Street, 290 Binney Street, 300 Binney Street and 121 Broadway.

Construction in progress for the three months ended March 31, 2023 included ongoing expenditures associated with 2100 Pennsylvania Avenue, which was partially placed in-service during the three months ended March 31, 2023.

(2) On January 8, 2024, we completed the acquisition of our joint venture partner’s 50% economic ownership interest in the joint venture that owns 901 New York Avenue, located in Washington, DC, for a gross purchase price of $10.0 million and we acquired net working capital, including cash and cash equivalents of approximately $16.1 million.

(3) Capital contributions to unconsolidated joint ventures for the three months ended March 31, 2024 consisted primarily of cash contributions of approximately $9.9 million, $6.7 million and $5.7 million to our Gateway Commons, 360 Park Avenue South and Platform 16 joint ventures, respectively.

Capital contributions to unconsolidated joint ventures for the three months ended March 31, 2023 consisted primarily of cash contributions of approximately $17.3 million, $15.6 million, $11.6 million, $6.5 million and $4.0 million to our Worldgate Drive, Gateway Commons, Platform 16, Dock 72 and 751 Gateway joint ventures, respectively.

On January 31, 2023, we entered into a new joint venture for 13100 and 13150 Worldgate Drive located in Herndon, Virginia.

Capital contributions to unconsolidated joint ventures for the nine months ended September 30, 2022 consisted primarily of cash contributions of approximately $44.8 million, $31.6 million and $16.4 million to our Gateway Commons, Platform 16 and 751 Gateway joint ventures, respectively.

(6) Capital distributions from unconsolidated joint ventures for the nine months ended September 30, 2023 consisted primarily of a cash distribution totaling approximately $7.4 million from our 360 Park Avenue South joint venture.

Capital distributions from unconsolidated joint ventures for the nine months ended September 30, 2022 consisted primarily of cash distributions totaling approximately $21.6 million and $11.6 million from our Metropolitan Square and 7750 Wisconsin Avenue joint ventures, respectively.

(7) On June 5, 2023, a joint venture in which we own a 30% interest repaid the existing construction loan collateralized by its 500 North Capitol Street, NW property and obtained new mortgage loans with related parties.

At the time of the pay off, the outstanding balance of the loan totaled approximately $105.0 million and was scheduled to mature on June 6, 2023.

The new mortgage loans have an aggregate principal balance of $105.0 million, bear interest at a weighted average fixed rate of 6.83% per annum and mature on June 5, 2026.

Our portion of the mortgage loans, $10.5 million, has been reflected as a Related Party Note Receivable on our Consolidated Balance Sheets.

500 North Capitol Street, NW is a 231,000 square foot premier workplace in Washington, DC.

(8) An affiliate of The Bernstein Companies exercised its option to borrow $10.0 million from us, and we 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.

Cash provided by financing activities for the nine months ended September 30, 2023 totaled approximately $154.8 million.

This amount consisted primarily of borrowings under the 2023 Unsecured Term Loan and the proceeds from the issuance by BPLP of $750 million in aggregate principal amount of its 6.500% unsecured senior notes due 2034, partially offset by the repayment of BPLP’s $730 million unsecured credit agreement (the “2022 Unsecured Term Loan”), repayment of BPLP’s $500 million in aggregate principal amount of its 3.125% unsecured senior notes due September 1, 2023 and payment of our regular dividends and distributions to our shareholders and unitholders and distributions to noncontrolling interests in property partnerships.

Cash used by financing activities for the three months ended March 31, 2024 totaled approximately $756.9 million.

This amount consisted primarily of the repayment of BPLP’s $700 million in aggregate principal amount of its 3.800% unsecured senior notes due February 1, 2024 and payment of our regular dividends and distributions to our shareholders and unitholders and distributions to noncontrolling interests in property partnerships, partially offset by the approximately $97.2 million from the sale of a 45% interest in 290 Binney Street in Cambridge, Massachusetts.

Future debt payments are discussed below under the heading “Debt Financing .”

1 unchanged sentence

The following table presents Consolidated Market Capitalization and BXP’s Share of Market Capitalization, as well as the corresponding ratios of Consolidated Debt to Consolidated Market Capitalization and BXP’s Share of Debt to BXP’s Share of Market Capitalization (in thousands, except for percentages):

September 30, 2023

March 31, 2024

Shares / Units Outstanding Common Stock Equivalent Equivalent Value (1)

11 unchanged sentences

_______________

(1) Values are based on the closing price per share of BXP’s Common Stock on the New York Stock Exchange on September 29, 2023 of $59.48.

(2) Includes long-term incentive plan units (including 2012 OPP Units and 2013 - 2020 MYLTIP Units) but excludes the 2021 - 2023 MYLTIP Units because the three-year performance periods had not ended as of September 30, 2023.

(1) Values are based on the closing price per share of BXP’s common stock on the New York Stock Exchange on March 28, 2024 of $65.31.

(2) Includes long-term incentive plan units (including 2012 OPP Units and 2013 - 2021 MYLTIP Units) but excludes the 2022 - 2024 MYLTIP Units because the three-year performance periods had not ended as of March 31, 2024.

(3) See page 73 for additional information.

4 unchanged sentences

(1) our consolidated debt;

(2) the product of (x) the closing price per share of BXP Common Stock on September 29, 2023, as reported by the New York Stock Exchange, multiplied by (y) the sum of:

(2) the product of (x) the closing price per share of BXP common stock on March 28, 2024, as reported by the New York Stock Exchange, multiplied by (y) the sum of:

(i) the number of outstanding shares of common stock of BXP,

3 unchanged sentences

The calculation of consolidated market capitalization does not include LTIP Units issued in the form of MYLTIP Awards unless and until certain performance thresholds are achieved and they are earned.

Because their three-year performance periods have not yet ended, 2021 - 2023 MYLTIP Units are not included in this calculation as of September 30, 2023.

Because their three-year performance periods have not yet ended, 2022 - 2024 MYLTIP Units are not included in this calculation as of March 31, 2024.

We also present BXP’s Share of Market Capitalization and BXP’s Share of Debt/BXP’s Share of Market Capitalization, which are calculated in the same manner, except that BXP’s Share of Debt is utilized instead of our consolidated debt in both the numerator and the denominator.

12 unchanged sentences

Debt Financing

As of September 30, 2023, we had approximately $15.0 billion of outstanding consolidated indebtedness, representing approximately 58.90% of our Consolidated Market Capitalization as calculated above consisting of approximately (1) $10.5 billion (net of discount and deferred financing fees) in publicly traded unsecured senior notes having a GAAP weighted-average interest rate of 3.91% per annum and maturities in 2024 through 2034, (2) $3.3 billion (net of deferred financing fees) of property-specific mortgage debt having a GAAP weighted-average interest rate of 3.42% per annum and a weighted-average term of 5.1 years and (3) $1.2 billion outstanding under BPLP’s 2023 Unsecured Term Loan that matures on May 16, 2024.

The table below summarizes the aggregate carrying value of our mortgage notes payable and BPLP’s unsecured senior notes, unsecured line of credit, and unsecured term loan, as well as Consolidated Debt Financing Statistics at September 30, 2023 and September 30, 2022.

September 30,

As of March 31, 2024, we had approximately $15.4 billion of outstanding consolidated indebtedness, representing approximately 57.17% of our Consolidated Market Capitalization as calculated above consisting of approximately (1) $9.8 billion (net of discount and deferred financing fees) in publicly traded unsecured senior notes having a GAAP weighted-average interest rate of 3.91% per annum and maturities in 2025 through 2034, (2) $4.4 billion (net of deferred financing fees and fair value interest adjustments) of property-specific mortgage debt having

a GAAP weighted-average interest rate of 4.22% per annum and a weighted-average term of 4.2 years and (3) $1.2 billion outstanding under BPLP’s 2023 Unsecured Term Loan that matures on May 16, 2024 (See Note 14 to the Consolidated Financial Statements).

The table below summarizes the aggregate carrying value of our outstanding indebtedness, as well as Consolidated Debt Financing Statistics at March 31, 2024 and March 31, 2023.

(dollars in thousands)

Debt Summary:

Fixed rate mortgage notes payable, net $ 3,275,974 $ 3,271,157

Mortgage notes payable, net $ 4,368,367 $ 3,273,553

Unsecured senior notes, net 9,794,527 10,240,967

5 unchanged sentences

BXP’s Share of Debt $ 15,375,437 $ 14,955,407

September 30,

Consolidated Debt Financing Statistics:

18 unchanged sentences

(2) See page 71 for additional information.

(3) The 2023 Unsecured Term Loan bears interest at a variable rate of adjusted Term SOFR plus a margin ranging from 75 to 160 basis points based on BPLP’s credit rating.

On May 2, 2023, BPLP executed interest rate swaps that effectively fixed Term SOFR for the $1.2 billion outstanding under the 2023 Unsecured Term Loan (see Notes 6 and 7 to the Consolidated Financial Statements).

As such, the 2023 Unsecured Term Loan is reflected within Fixed rate statistics.

(3) At March 31, 2024, the $1.2 billion 2023 Unsecured Term Loan and two of our mortgage loans aggregating approximately $900.0 million bore interest at variable rates.

We entered into interest rate swap contracts that effectively fixed the variability of these loans for all or a portion of the applicable debt term and as such, they are reflected in our Fixed rate statistics.

Unsecured Credit Facility

The 2021 Credit Facility provides for borrowings of up to $1.815 billion, as described below, through the Revolving Facility, subject to customary conditions.

The 2021 Credit Facility provides for borrowings of up to $2.0 billion, as described below, subject to customary conditions.

The 2021 Credit Facility matures on June 15, 2026 and includes a sustainability-linked pricing component.

Under the 2021 Credit Facility, BPLP may increase the total commitment by up to $500.0 million by utilizing the Accordion.

On September 28, 2023, BPLP exercised a portion of the Accordion with three New Lenders to the 2021 Credit Facility.

Each of the New Lenders entered into a lender agreement with BPLP to provide an aggregate of $315.0 million in additional revolving credit commitments, which

increased the maximum borrowing amount under the 2021 Credit Facility from $1.5 billion to $1.815 billion.

Under the 2021 Credit Facility, BPLP may increase the total commitment by up to $500.0 million by increasing the amount of the revolving facility and/or by incurring one or more term loans, in each case, subject to syndication of the increase and other conditions (the “Accordion”).

On September 28, 2023, BPLP exercised a portion of the Accordion which increased the maximum borrowing amount under the 2021 Credit Facility from $1.5 billion to $1.815 billion.

On April 29, 2024, BPLP exercised the remainder of the Accordian and increased the maximum borrowing amount under the 2021 Credit Facility from $1.815 billion to $2.0 billion.

All other terms of the 2021 Credit Facility remain unchanged.

On June 1, 2023, BPLP amended its 2021 Credit Facility to replace the LIBOR-based daily floating rate option with a SOFR-based daily floating rate option and to add options for SOFR-based term floating rates and rates for alternative currency loans.

In addition, the amendment added a SOFR credit spread adjustment of 0.10%.

Other than the foregoing, the material terms of the 2021 Credit Facility remain unchanged.

Based on BPLP’s September 30, 2023 credit rating, (1) the applicable Daily SOFR, Term SOFR, alternative currency daily rate, and alternative currency term rate margins are 0.775%, (2) the alternate base rate margin is zero basis points and (3) the facility fee is 0.15% per annum.

At September 30, 2023 and October 30, 2023, BPLP had no borrowings under its Revolving Facility and outstanding letters of credit totaling approximately $6.7 million, with the ability to borrow approximately $1.8 billion.

At BPLP’s option, loans under the 2021 Credit Facility will bear interest at a rate per annum equal to (1) (a) in

the case of loans denominated in Dollars, Term SOFR and SOFR, (b) in the case of loans denominated in Euro,

EURIBOR, (c) in the case of loans denominated in Canadian Dollars, CDOR, and (d) in the case of loans

denominated in Sterling, SONIA, in each case, plus a margin ranging from 70.0 to 140.0 basis points based on

BPLP’s credit rating or (2) an alternate base rate equal to the greatest 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%, in each case, plus a margin

ranging from 0 to 40 basis points based on BPLP’s credit rating.

In addition, there is a SOFR credit spread adjustment of 0.10%.

Based on BPLP’s March 31, 2024 credit rating, (1) the applicable Daily SOFR, Term SOFR, alternative currency daily rate, and alternative currency term rate margins are 0.850%, (2) the alternate base rate margin is zero basis points and (3) the facility fee is 0.20% per annum.

At March 31, 2024, BPLP had no borrowings under its 2021 Credit Facility and outstanding letters of credit totaling approximately $6.7 million, with the ability to borrow approximately $1.8 billion.

At May 2, 2024, BPLP had no borrowings under its 2021 Credit Facility and outstanding letters of credit totaling approximately $6.6 million, with the ability to borrow approximately $2.0 billion, of which $500.0 million is being used as a backstop for the commercial paper program.

Unsecured Term Loan

On January 4, 2023, BPLP entered into the 2023 Unsecured Term Loan, which provided for a single borrowing of up to $1.2 billion.

Under the credit agreement, BPLP may, at any time prior to the maturity date, increase total commitments by up to an additional $300.0 million in aggregate principal amount by increasing the existing 2023 Unsecured Term Loan or incurring one or more additional term loans, in each case, subject to syndication of the increase and other conditions.

The 2023 Unsecured Term Loan provided for a single borrowing of up to $1.2 billion.

Upon entry into the credit agreement in January 2023, BPLP exercised its option to draw $1.2 billion under the 2023 Unsecured Term Loan, a portion of which was used to repay in full BPLP’s $730.0 million unsecured term loan (the “2022 Unsecured Term Loan”), which was scheduled to mature on May 16, 2023.

Under the credit agreement governing the 2023 Unsecured Term Loan, BPLP may, at any time prior to the maturity date, increase total commitments by up to an additional $300.0 million in aggregate principal amount by increasing the existing 2023 Unsecured Term Loan or incurring one or more additional term loans, in each case, subject to syndication of the increase and other conditions.

The 2023 Unsecured Term Loan matures on May 16, 2024, with one 12-month extension option, subject to customary conditions.

Upon entry into the credit agreement, BPLP exercised its option to draw $1.2 billion under the 2023 Unsecured Term Loan, a portion of which was used to repay in full the 2022 Unsecured Term Loan, which was scheduled to mature on May 16, 2023.

There was no prepayment penalty associated with the repayment of the 2022 Unsecured Term Loan.

On April 16, 2024, BPLP provided notice to exercise its one-year extension option on the 2023 Unsecured Term Loan.

BPLP anticipates effectuating the extension on or prior to the current May 16, 2024 maturity date.

Upon effectiveness, the 2023 Unsecured Term Loan will mature on May 16, 2025.

At BPLP’s option, loans under the 2023 Unsecured Term Loan will bear interest at a rate per annum equal to (1) a base rate equal to the greatest of (a) the Federal Funds rate plus 0.5%, (b) the administrative agent’s prime rate, (c) Term SOFR for a one-month period plus 1.00%, and (d) 1.00%, in each case, plus a margin ranging from 0 to 60 basis points based on BPLP’s credit rating;

or (2) a rate equal to adjusted Term SOFR with a one-month period plus a margin ranging from 75 to 160 basis points based on BPLP’s credit rating.

As of September 30, 2023, the 2023 Unsecured Term Loan bears interest at a rate equal to adjusted Term SOFR plus 0.85% per annum based on BPLP’s current credit rating at September 30, 2023 (See Note 7 to the Consolidated Financial Statements).

At September 30, 2023, BPLP had $1.2 billion outstanding under the 2023 Unsecured Term Loan.

Derivative Instruments and Hedging Activities

On May 2, 2023, BPLP executed interest rate swaps in notional amounts aggregating $1.2 billion.

These interest rate swaps were entered into to fix Term SOFR, the reference rate for BPLP’s 2023 Unsecured Term Loan, at a weighted-average rate of 4.6420% for the period commencing on May 4, 2023 and ending on May 16, 2024 (See Note 7 to the Consolidated Financial Statements).

These interest rate swaps were entered into to fix Term SOFR, at a weighted-average rate of 4.6420% for the period commencing on May 4, 2023 and ending on May 16, 2024 (See Note 7 to the Consolidated Financial Statements).

Based on BPLP’s March 31, 2024 credit rating, the 2023 Unsecured Term Loan bears interest at a rate equal to adjusted Term SOFR plus 0.95% per annum.

At March 31, 2024, BPLP had $1.2 billion outstanding under the 2023 Unsecured Term Loan.

After making an approximately $500.0 million optional repayment on April 29, 2024, the 2023 Unsecured Term Loan has an outstanding principal balance of $700.0 million as of May 2, 2024.

Unsecured Senior Notes

For a description of BPLP’s outstanding unsecured senior notes as of September 30, 2023, see Note 6 to the Consolidated Financial Statements.

On May 15, 2023, BPLP completed a public offering of $750.0 million in aggregate principal amount of its 6.500% unsecured senior notes due 2034.

The notes were priced at 99.697% of the principal amount to yield an effective rate (including financing fees) of approximately 6.619% per annum to maturity.

The notes will mature on January 15, 2034, unless earlier redeemed.

The aggregate net proceeds from the offering were approximately $741.3 million after deducting underwriting discounts and transaction expenses.

On September 1, 2023, BPLP completed the repayment of $500.0 million in aggregate principal amount of its 3.125% senior notes due September 1, 2023.

For a description of BPLP’s outstanding unsecured senior notes as of March 31, 2024, see Note 6 to the Consolidated Financial Statements.

On February 1, 2024, BPLP repaid $700.0 million in aggregate principal amount of its 3.800% senior notes due February 1, 2024.

The repayment was completed with available cash and the $600.0 million proceeds from the mortgage loan entered into on October 26, 2023.

Excluding the accrued and unpaid interest, the repayment price was equal to the principal amount being repaid.

The indenture relating to the unsecured senior notes contains certain financial restrictions and requirements, including (1) a leverage ratio not to exceed 60%, (2) a secured debt leverage ratio not to exceed 50%, (3) an interest coverage ratio of greater than 1.50, and (4) an unencumbered asset value of not less than 150% of unsecured debt.

At September 30, 2023, BPLP was in compliance with each of these financial restrictions and requirements.

Commercial Paper Program

On April 17, 2024, BPLP established an unsecured commercial paper program.

The notes will be sold in private placements and will rank pari passu with all of BPLP’s other unsecured senior indebtedness, including its outstanding senior notes.

The commercial paper program is backstopped by available capacity under BPLP's 2021 Credit Facility.

As of May 2, 2024, BPLP had $500.0 million outstanding under its commercial paper program that bears interest at a weighted-average rate of 5.58% per annum.

Proceeds from the commercial paper program were used to reduce BPLP’s 2023 Unsecured Term Loan to $700.0 million.

Mortgage Notes Payable

The following represents the outstanding principal balances due under the mortgage notes payable at September 30, 2023 (See Note 14 to the Consolidated Financial Statements):

Properties Stated Interest Rate GAAP Interest Rate (1) Stated Principal Amount Deferred Financing Costs, Net Carrying Amount Carrying Amount (Partners ’ Share)

On January 8, 2024, we completed the acquisition of our joint venture partner’s 50% economic ownership interest in the joint venture that owns 901 New York Avenue located in Washington, DC (See Note 3 to the Consolidated Financial Statements).

The property is subject to existing mortgage indebtedness.

At acquisition, the mortgage loan had an outstanding balance of approximately $207.1 million, bore interest at 3.61% per annum and was scheduled to mature on January 5, 2025.

The mortgage loan was recorded at fair value of approximately $198.7 million.

On January 11, 2024, we modified the mortgage loan to provide for two extension options totaling five years of additional term, each subject to certain conditions.

The following represents the outstanding mortgage notes payable, net at March 31, 2024:

Properties Stated Interest Rate GAAP Interest Rate (1) Stated Principal Amount Fair Value Adjustment and Deferred Financing Costs, Net Carrying Amount Carrying Amount (Partners ’ Share)

Maturity Date

(dollars in thousands)

901 New York Avenue 3.61 % 7.69 % $ 206,289 $ (6,530) $ 199,759 N/A (2) January 5, 2025

Santa Monica Business Park 4.06 % 6.53 % 300,000 (3,649) 296,351 N/A (3)(4) July 19, 2025

90 Broadway, 325 Main Street, 355 Main Street, and Cambridge East Garage (also known as Kendall Center Green Garage) 6.04 % 6.26 % 600,000 (6,139) 593,861 N/A (3)(5) October 26, 2028

Subtotal 1,106,289 (16,318) 1,089,971 N/A

Consolidated Joint Ventures

2 unchanged sentences

601 Lexington Avenue 2.79 % 2.93 % 1,000,000 (10,482) 989,518 445,283 (3)(8) January 9, 2032

Subtotal 3,300,000 (21,604) 3,278,396 1,360,873

Total $ 4,406,289 $ (37,922) $ 4,368,367 $ 1,360,873

_______________

(1) GAAP interest rate differs from the stated interest rate due to the inclusion of the amortization of financing charges and the effects of hedging transactions (if any).

(1) The GAAP interest rate differs from the stated interest rate due to the inclusion of the amortization of financing charges, the effects of hedging transactions (if any) and adjustments required under Accounting Standards Codification 805 “Business Combinations” to reflect loans and swaps at their fair values (if any).

(2) Deferred financing costs, net includes an approximately $6.5 million fair value interest adjustment.

The loan includes two extension options, subject to certain conditions.

(3) The mortgage loan requires interest only payments with a balloon payment due at maturity.

(4) The mortgage loan bears interest at a variable rate of SOFR plus 1.38% per annum.

The borrower under the loan entered into three interest rate swap contracts with notional amounts aggregating $300.0 million to fix SOFR at a weighted-average fixed interest rate of 2.679% for the period commencing on February 1, 2023 and ending on April 1, 2025.

Stated interest rate reflects the weighted average fixed interest rate based on the interest rate swap contracts plus 1.38% per annum.

Deferred financing costs, net includes an approximately $3.6 million fair value interest adjustment and excludes the adjustment required to reflect the interest rate swap at fair value upon acquisition of approximately $5.7 million.

(5) The mortgage loan bears interest at a variable rate of Daily Compounded SOFR plus 2.25% per annum.

On December 7, 2023, BPLP entered into three interest rate swap contracts with notional amounts aggregating $600.0 million to fix Daily Compounded SOFR at a weighted-average fixed interest rate of 3.7925% for the period commencing on December 15, 2023 and ending on October 26, 2028.

Stated interest rate reflects the weighted average fixed interest rate based on the interest rate swap contracts plus 2.25% per annum.

(6) This property is owned by a consolidated entity in which we have a 60% interest.

1 unchanged sentence

(7) In connection with the refinancing of the loan, we guaranteed the consolidated entity’s obligation to fund various reserves for tenant improvement costs and allowances, leasing commissions and free rent obligations in lieu of cash deposits.

As of September 30, 2023, the maximum funding obligation under the guarantee was approximately $10.0 million.

As of March 31, 2024, the maximum funding obligation under the guarantee was approximately $8.5 million.

We earn a fee from the joint venture for providing the guarantee and have an agreement with our partners to reimburse the joint venture for their share of any payments made under the guarantee (See Note 8 to the Consolidated Financial Statements).

(8) This property is owned by a consolidated entity in which we have a 55% interest.

Derivative Instruments and Hedging Activities

As of March 31, 2024, we had $2.1 billion of interest rate swaps outstanding, where hedge accounting was elected, with a fair value of approximately $12.3 million.

For a description of these interest rate swaps, see Note 7 to the Consolidated Financial Statements.

Investment in Unconsolidated Joint Ventures - Secured Debt

We have investments in unconsolidated joint ventures with our effective ownership interests ranging from 20% to 55%.

Seventeen of these ventures have mortgage indebtedness.

We have investments in unconsolidated joint ventures with our effective ownership interests ranging from 20% to approximately 71%.

Fourteen of these ventures have mortgage indebtedness.

We exercise significant influence over, but do not control, these entities.

1 unchanged sentence

See also Note 5 to the Consolidated Financial Statements.

At September 30, 2023, the aggregate carrying amount of debt, including both our and our partners’ share, incurred by these ventures was approximately $4.0 billion (of which our proportionate share is approximately $1.5 billion).

The table below summarizes the outstanding debt of these joint venture properties at September 30, 2023.

At March 31, 2024, the aggregate carrying amount of debt, including both our and our partners’ share, incurred by these ventures was approximately $3.2 billion (of which our proportionate share is approximately $1.4 billion).

The table below summarizes the outstanding debt of these joint venture properties at March 31, 2024.

In addition to other guarantees specifically noted in the table, we have agreed to customary environmental indemnifications and nonrecourse carve-outs (e.g., guarantees against fraud, misrepresentation and bankruptcy) as well as the completion of development projects on certain of the loans.

Properties Nominal % Ownership Stated Interest Rate GAAP Interest Rate (1) Stated Principal Amount Deferred Financing Costs, Net Carrying Amount Carrying Amount (Our share) Maturity Date

Properties Nominal % Ownership Stated Interest Rate GAAP Interest Rate (1) Term of Variable Rate + Spread Stated Principal Amount Deferred Financing Costs, Net Carrying Amount Carrying Amount (Our share) Maturity Date

(dollars in thousands)

Santa Monica Business Park 55.00 % 4.06 % 4.23 % $ 300,000 $ (958) $ 299,042 $ 164,473 (2)(4) July 19, 2025

Market Square North 50.00 % 7.74 % 7.92 % 125,000 (482) 124,518 62,259 (2)(3) (5) November 10, 2025

1265 Main Street 50.00 % 3.77 % 3.84 % 34,895 (229) 34,666 17,333 January 1, 2032

Colorado Center 50.00 % 3.56 % 3.59 % 550,000 (691) 549,309 274,655 (2) August 9, 2027

Dock 72 50.00 % 7.82 % 8.08 % 198,383 (1,011) 197,372 98,686 (2)(6) December 18, 2025

The Hub on Causeway - Podium 50.00 % 7.35 % 7.75 % 154,329 (1,238) 153,091 76,546 (2)(3) (7) September 8, 2025

Hub50House 50.00 % 4.43 % 4.51 % 185,000 (1,189) 183,811 91,906 (2)(8) June 17, 2032

100 Causeway Street 50.00 % 6.80 % 6.95 % 333,579 (439) 333,140 166,570 (2)(3) (9) September 5, 2024

7750 Wisconsin Avenue (Marriott International Headquarters) 50.00 % 6.68 % 6.83 % 251,542 (220) 251,322 125,661 (2)(3) (10) April 26, 2024

360 Park Avenue South 42.21 % 7.83 % 8.28 % 220,000 (1,206) 218,794 92,353 (2)(3) (11) December 14, 2024

Safeco Plaza 33.67 % 4.82 % 4.96 % 250,000 (992) 249,008 83,841 (2)(12) September 1, 2026

500 North Capitol Street, NW 30.00 % 6.83 % 7.16 % 105,000 (755) 104,245 31,104 (2)(13) June 5, 2026

200 Fifth Avenue 26.69 % 4.34 % 5.60 % 600,000 (8,575) 591,425 150,193 (2)(14) November 24, 2028

901 New York Avenue 25.00 % 3.61 % 3.69 % 208,686 (223) 208,463 52,116 January 5, 2025

3 Hudson Boulevard 25.00 % 9.04 % 9.04 % 80,000 — 80,000 20,000 (2) (15) February 9, 2024

Metropolitan Square 20.00 % 7.25 % 8.03 % 420,000 (1,712) 418,288 — (2)(3) (16) April 9, 2024

Skymark - Reston Next Residential 20.00 % 7.33 % 7.65 % 53,665 (1,172) 52,493 10,499 (2)(3) (17) May 13, 2026

360 Park Avenue South 71.11 % 7.83 % 8.28 % Adjusted Term SOFR + 2.40% $ 220,000 $ (705) $ 219,295 $ 155,940 (2)(3)(4) December 14, 2024

Market Square North 50.00 % 7.73 % 7.91 % SOFR + 2.41% 125,000 (368) 124,632 62,316 (2)(3)(5) November 10, 2025

1265 Main Street 50.00 % 3.77 % 3.84 % N/A 34,424 (216) 34,208 17,104 January 1, 2032

Colorado Center 50.00 % 3.56 % 3.59 % N/A 550,000 (601) 549,399 274,700 (2) August 9, 2027

Dock 72 50.00 % 7.83 % 8.09 % SOFR +2.50% 198,383 (825) 197,558 98,779 (2)(6) December 18, 2025

The Hub on Causeway - Podium 50.00 % 7.35 % 7.75 % Daily Simple SOFR + 2.50% 154,329 (887) 153,442 76,721 (2)(3)(7) September 8, 2025

Hub50House 50.00 % 4.43 % 4.51 % SOFR + 1.35% 185,000 (1,120) 183,880 91,940 (2)(8) June 17, 2032

100 Causeway Street 50.00 % 6.80 % 6.94 % SOFR + 1.48% 333,579 (203) 333,376 166,688 (2)(3) September 5, 2024

7750 Wisconsin Avenue (Marriott International Headquarters) 50.00 % 6.67 % 6.82 % SOFR + 1.35% 251,542 (406) 251,136 125,568 (2) April 26, 2025

Safeco Plaza 33.67 % 4.82 % 7.73 % SOFR + 2.32% 250,000 (822) 249,178 83,898 (2)(9) September 1, 2026

500 North Capitol Street, NW 30.00 % 6.83 % 7.16 % N/A 105,000 (614) 104,386 31,178 (2)(10) June 5, 2026

200 Fifth Avenue 26.69 % 4.34 % 5.60 % Term SOFR + 1.41% 600,000 (7,764) 592,236 151,190 (2)(11) November 24, 2028

3 Hudson Boulevard 25.00 % 9.04 % 9.04 % Term SOFR + 3.61% 80,000 — 80,000 20,000 (2)(12) May 9, 2024

Skymark - Reston Next Residential 20.00 % 7.33 % 7.65 % SOFR + 2.00% 90,767 (948) 89,819 17,964 (2)(3)(13) May 13, 2026

Total $ 3,178,024 $ (15,479) $ 3,162,545 $ 1,373,986

_______________

(1) GAAP interest rate differs from the stated interest rate due to the inclusion of the amortization of financing charges, which includes mortgage recording fees.

(1) The GAAP interest rate differs from the stated interest rate due to the inclusion of the amortization of financing costs, which includes mortgage recording fees, the effects of hedging transactions (if any) and adjustments required under Accounting Standards Codification 805 “Business Combinations” to reflect loans at their fair values (if any).

(2) The loan requires interest only payments with a balloon payment due at maturity.

(3) The loan includes certain extension options, subject to certain conditions.

(4) The loan bears interest at a variable rate equal to SOFR plus 1.38% per annum.

A subsidiary of the joint venture entered into interest rate swap contracts with notional amounts aggregating $300.0 million through April 1, 2025, resulting in a fixed rate of approximately 4.059% per annum through the expiration of the interest rate swap contracts.

(4) The spread on the variable rate may be reduced, subject to certain conditions.

(5) The loan bears interest at a variable rate equal to the greater of (1) the sum of (x) SOFR and (y) 2.41% or (2) 2.80% per annum.

(6) The loan bears interest at a variable rate equal to (1) the greater of (x) SOFR or (y) 0.25%, plus (2) 2.50% per annum.

(7) The loan bears interest at a variable rate equal to Daily Simple SOFR plus 2.50% per annum.

(7) The joint venture entered into interest rate swap contracts with notional amounts aggregating $154.3 million through September 2, 2025, resulting in a fixed rate of approximately 7.35% per annum through the expiration of the interest rate swap contracts.

(8) The loan bears interest at a variable rate equal to SOFR plus 1.35% per annum.

(8) 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.

(9) The loan bears interest at a variable rate equal to SOFR plus 1.48% per annum.

(10) The loan bears interest at a variable rate equal to SOFR plus 1.35% per annum.

(11) The loan bears interest at a variable rate equal to Adjusted Term SOFR plus 2.40% per annum.

The spread on the variable rate may be reduced, subject to certain conditions.

(9) The loan bears interest at a variable rate equal to the greater of (x) 2.35% or (y) SOFR plus 2.32% per annum.

The joint venture entered into an interest rate cap agreement with a financial institution to limit its exposure to

increases in the SOFR rate at a cap of 2.50% per annum on a notional amount of $250.0 million through September 1, 2024.

The joint venture entered into an interest rate cap agreement with a financial institution to limit its exposure to increases in the SOFR rate at a cap of 2.50% per annum on a notional amount of $250.0 million through September 1, 2024.

(10) The indebtedness consists of (x) a $70.0 million mortgage loan payable (Note A) which bears interest at a fixed rate of 6.23% per annum, and (y) a $35.0 million mortgage loan payable (Note B) which bears interest at a fixed rate of 8.03% per annum.

We provided $10.5 million of the Note B mortgage financing to the joint venture.

Our portion of the loan has been reflected as Related Party Note Receivable, Net on our Consolidated Balance Sheets.

(14) The loan bears interest at a variable rate equal to Term SOFR plus approximately 1.41% per annum.

Our portion of the loan is reflected as Related Party Note Receivables, Net on our Consolidated Balance Sheets.

(11) The joint venture entered into interest rate swap contracts with notional amounts aggregating $600.0 million through June 2028, resulting in a fixed rate of approximately 4.34% per annum through the expiration of the interest rate swap contracts.

In addition to items noted in footnote one above, the GAAP interest rate includes the adjustment required to reflect the loan at fair value upon acquisition.

The deferred financing costs, net include the adjustment required to reflect the loan and interest rate swap at fair value upon acquisition.

(12) We provided $80.0 million of mortgage financing to the joint venture.

The loan bears interest at a variable rate equal to Term SOFR plus 3.61% per annum.

The loan has been reflected as Related Party Note Receivable, Net on our Consolidated Balance Sheets.

As of September 30, 2023, the loan has approximately $25.6 million of accrued interest due at the maturity date.

(16) The joint venture completed a two-step restructuring of the ownership in this property, which resulted in (i) an affiliate of the existing mezzanine lender purchasing the property and becoming the a new property owner and us no longer having an equity interest in the property and (ii) us becoming a co-lender of up to $20.0 million under the New Mezz Loan.

Step one of the restructuring was completed on September 13, 2023, and resulted in, among other things, (i) the cessation of our obligation to fund future investments through our then 20% equity interest, which caused us to recognize a gain on investment of approximately $35.8 million related to its deficit investment balance, which was primarily due to excess distributions, and (ii) the removal of the property from our in-service portfolio.

Step two of the restructuring was completed on October 2, 2023, and included (i) the sale of the property and assignment of the Senior Loan to the new owner, and (ii) the closing of a New Mezz Loan with a maximum principal amount of $100.0 million that is senior to the Existing Mezz Loan and subordinate to the Senior Loan (See Notes 5 and 14 to the Consolidated Financial Statements).

The loan is reflected as Related Party Note Receivables, Net on our Consolidated Balance Sheets.

As of March 31, 2024, the loan has approximately $30.4 million of accrued interest due at the maturity date.

(13) The construction financing has a borrowing capacity of $140.0 million.

The construction financing bears interest at a variable rate equal to SOFR plus 2.00% per annum.

State and Local Tax Matters

6 unchanged sentences

Funds from Operations

Pursuant to the revised definition of Funds from Operations adopted by the Board of Governors of the National Association of Real Estate Investment Trusts (“Nareit”), we calculate Funds from Operations, or “FFO,” for each of BXP and BPLP by adjusting net income (loss) attributable to Boston Properties, Inc.

and net income (loss) attributable to Boston Properties Limited Partnership (computed in accordance with GAAP), respectively, for gains (or losses) from sales of properties, including a change in control, impairment losses on depreciable real estate consolidated on our balance sheet, impairment losses on our investments in unconsolidated joint ventures driven by a measurable decrease in the fair value of depreciable real estate held by the unconsolidated joint ventures and our share of real estate-related depreciation and amortization.

and net income attributable to Boston Properties Limited Partnership (computed in accordance with GAAP), respectively, for gains (or losses) from sales of properties, including a change in control, impairment losses on depreciable real estate consolidated on our balance sheet, impairment losses on our investments in unconsolidated joint ventures driven by a measurable decrease in the fair value of depreciable real estate held by the unconsolidated joint ventures and our share of real estate-related depreciation and amortization.

FFO is a non-GAAP financial measure.

We believe the presentation of FFO, combined with the presentation of required GAAP financial measures, improves the understanding of operating results of REITs among the investing public and helps make comparisons of REIT operating results more meaningful.

Management generally considers FFO to be useful measures for understanding and comparing our operating results because, by excluding gains and losses related to sales or a change in control of previously depreciated operating real estate assets, impairment losses and real estate asset depreciation and amortization (which can differ across owners of similar assets in similar condition based on historical cost accounting and useful life estimates), FFO can help investors compare the operating performance of a company’s real estate across reporting periods and to the operating performance of other companies.

Management generally considers FFO to be a useful measure for understanding and comparing our operating results because, by excluding gains and losses related to sales or a change in control of previously depreciated operating real estate assets, impairment losses and real estate asset depreciation and amortization (which can differ across owners of similar assets in similar condition based on historical cost accounting and useful life estimates), FFO can help investors compare the operating performance of a company’s real estate across reporting periods and to the operating performance of other companies.

Our computation of FFO may not be comparable to FFO reported by other REITs or real estate companies that do not define the term in accordance with the current Nareit definition or that interpret the current Nareit definition differently.

We believe that in order to facilitate a clear understanding of our operating results, FFO should be examined in conjunction with net income (loss) attributable to Boston Properties, Inc.

and net income (loss) attributable to Boston Properties Limited Partnership as presented in our Consolidated Financial Statements.

FFO should not be considered as a substitute for net income (loss) attributable to Boston Properties, Inc.

The following table presents a reconciliation of net income (loss) attributable to Boston Properties, Inc.

We believe that in order to facilitate a clear understanding of our operating results, FFO should be examined in conjunction with net income attributable to Boston Properties, Inc.

and net income attributable to Boston Properties Limited Partnership as presented in our Consolidated Financial Statements.

FFO should not be considered as a substitute for net income attributable to Boston Properties, Inc.

The following table presents a reconciliation of net income attributable to Boston Properties, Inc.

to FFO attributable to Boston Properties, Inc.

for the three months ended September 30, 2023 and 2022:

Three months ended September 30,

for the three months ended March 31, 2024 and 2023:

Three months ended March 31,

(in thousands)

Net income (loss) attributable to Boston Properties, Inc.

Net income attributable to Boston Properties, Inc.

$ 79,883 $ 77,890

1 unchanged sentence

Noncontrolling interests in property partnerships 17,221 18,660

Net income (loss) (103,543) 420,661

Net income 106,604 105,628

Depreciation and amortization 218,716 208,734

2 unchanged sentences

Corporate-related depreciation and amortization (419) (469)

Impairment losses included within loss on investment unconsolidated joint ventures (1) 272,603 —

Gain on investment included within loss from unconsolidated joint ventures (2) 35,756 —

Gains on sales of real estate 517 262,345

Unrealized loss on non-real estate investment (51) —

Non-real estate depreciation and amortization 2,130 —

Impairment loss 13,615 —

Gain (loss) on sale / consolidation included within loss from unconsolidated joint ventures 21,696 —

Unrealized gain on non-real estate investment 396 259

Noncontrolling interests in property partnerships 17,221 18,660

Funds from Operations (FFO) attributable to the Operating Partnership 326,410 333,538

Funds from Operations (FFO) attributable to the Operating Partnership common unitholders (including Boston Properties, Inc.) 302,861 302,908

Noncontrolling interest—common units of the Operating Partnership’s share of funds from operations 31,588 30,957

3 unchanged sentences

Weighted average shares outstanding—basic 156,983 156,803

(1) During the three months ended September 30, 2023, we recognized an other-than-temporary impairment loss on our investments in Platform 16, 360 Park Avenue South, 200 Fifth Avenue and Safeco Plaza of approximately $155.2 million, $54.0 million, $33.4 million and $29.9 million, respectively (See Note 5 to the Consolidated Financial Statements).

(2) On September 13, 2023, a joint venture in which we owned a 20% equity interest completed the first step of a two-step restructuring of the ownership in Metropolitan Square, which resulted in, among other things, (i) the cessation of our obligation to fund future investments through our then 20% equity interest, which caused us to recognize a gain on investment of approximately $35.8 million related to our deficit investment balance, which was primarily due to excess distributions, and (ii) the removal of the property from our in-service portfolio (See Notes 5 and 14 of the Consolidated Financial Statements).

The following tables presents a reconciliation of net income (loss) attributable to Boston Properties, Inc.

The following tables presents a reconciliation of net income attributable to Boston Properties, Inc.

to Diluted FFO attributable to Boston Properties, Inc.

for income (numerator) and shares/units (denominator) for the three months ended September 30, 2023 and 2022:

Three months ended September 30,

for income (numerator) and shares/units (denominator) for the three months ended March 31, 2024 and 2023:

Three months ended March 31,

(in thousands)

Net income (loss) attributable to Boston Properties, Inc.

Net income attributable to Boston Properties, Inc.

$ 79,883 $ 77,890

1 unchanged sentence

Noncontrolling interests in property partnerships 17,221 18,660

Net income (loss) (103,543) 420,661

Net income 106,604 105,628

Depreciation and amortization 218,716 208,734

2 unchanged sentences

Corporate-related depreciation and amortization (419) (469)

Impairment losses included within loss on investment unconsolidated joint ventures (1) 272,603 —

Gain on investment included within loss from unconsolidated joint ventures (2) 35,756 —

Gains on sales of real estate 517 262,345

Unrealized loss on non-real estate investment (51) —

Non-real estate depreciation and amortization 2,130 —

Impairment loss 13,615 —

Gain (loss) on sale / consolidation included within loss from unconsolidated joint ventures 21,696 —

Unrealized gain on non-real estate investment 396 259

Noncontrolling interests in property partnerships 17,221 18,660

Funds from Operations (FFO) attributable to the Operating Partnership 326,410 333,538

Funds from Operations (FFO) attributable to the Operating Partnership common unitholders (including Boston Properties, Inc.) 302,861 302,908

Effect of Dilutive Securities:

4 unchanged sentences

(1) $ 271,303 $ 271,981

(3) BXP’s share of diluted Funds from Operations was 89.73% and 89.90% for the three months ended September 30, 2023 and 2022, respectively.

Three months ended September 30,

(1) BXP’s share of diluted Funds from Operations was 89.58% and 89.79% for the three months ended March 31, 2024 and 2023, respectively.

Three months ended March 31,

shares/units (in thousands)

7 unchanged sentences

_______________

(1) BXP’s share of diluted Funds from Operations was 89.73% and 89.90% for the three months ended September 30, 2023 and 2022, respectively.

The following table presents a reconciliation of net income (loss) attributable to Boston Properties Limited Partnership to FFO attributable to Boston Properties Limited Partnership for the three months ended September 30, 2023 and 2022:

Three months ended September 30,

(1) BXP’s share of diluted Funds from Operations was 89.58% and 89.79% for the three months ended March 31, 2024 and 2023, respectively.

The following table presents a reconciliation of net income attributable to Boston Properties Limited Partnership to FFO attributable to Boston Properties Limited Partnership for the three months ended March 31, 2024 and 2023:

Three months ended March 31,

(in thousands)

Net income (loss) attributable to Boston Properties Limited Partnership $ (122,696) $ 403,578

Net income attributable to Boston Properties Limited Partnership $ 91,080 $ 88,830

Noncontrolling interests in property partnerships 17,221 18,660

Net income (loss) (101,787) 422,379

Net income 108,301 107,490

Depreciation and amortization 217,019 206,872

2 unchanged sentences

Corporate-related depreciation and amortization (419) (469)

Impairment losses included within loss on investment unconsolidated joint ventures (1) 272,603 —

Gain on investment included within loss from unconsolidated joint ventures (2) 35,756 —

Gains on sales of real estate 517 262,357

Unrealized loss on non-real estate investment (51) —

Non-real estate depreciation and amortization 2,130 —

Impairment loss 13,615 —

Gain (loss) on sale / consolidation included within loss from unconsolidated joint ventures 21,696 —

Unrealized gain on non-real estate investment 396 259

Noncontrolling interests in property partnerships 17,221 18,660

2 unchanged sentences

_______________

(1) Our calculation includes OP Units and vested LTIP Units (including vested 2012 OPP Units and vested 2013 - 2021 MYLTIP Units).

The following tables presents a reconciliation of net income (loss) attributable to Boston Properties Limited Partnership to Diluted FFO attributable to Boston Properties Limited Partnership for income (numerator) and shares/units (denominator) for the three months ended September 30, 2023 and 2022:

Three months ended September 30,

The following tables presents a reconciliation of net income attributable to Boston Properties Limited Partnership to Diluted FFO attributable to Boston Properties Limited Partnership for income (numerator) and shares/units (denominator) for the three months ended March 31, 2024 and 2023:

Three months ended March 31,

(in thousands)

Net income (loss) attributable to Boston Properties Limited Partnership $ (122,696) $ 403,578

Net income attributable to Boston Properties Limited Partnership $ 91,080 $ 88,830

Noncontrolling interests in property partnerships 17,221 18,660

Net income (loss) (101,787) 422,379

Net income 108,301 107,490

Depreciation and amortization 217,019 206,872

2 unchanged sentences

Corporate-related depreciation and amortization (419) (469)

Impairment losses included within loss on investment unconsolidated joint ventures (1) 272,603 —

Gain on investment included within loss from unconsolidated joint ventures (2) 35,756 —

Gains on sales of real estate 517 262,357

Unrealized loss on non-real estate investment (51) —

Non-real estate depreciation and amortization 2,130 —

Impairment loss 13,615 —

Gain (loss) on sale / consolidation included within loss from unconsolidated joint ventures 21,696 —

Unrealized gain on non-real estate investment 396 259

Noncontrolling interests in property partnerships 17,221 18,660

4 unchanged sentences

_______________

(1) Our calculation includes OP Units and vested LTIP Units (including vested 2012 OPP Units and vested 2013 - 2021 MYLTIP Units).

Three months ended September 30,

Three months ended March 31,

shares/units (in thousands)

8 unchanged sentences

Contract terms are generally between three and five years.

During the three months ended September 30, 2023, we paid approximately $127.3 million to fund tenant-related obligations, including tenant improvements and leasing commissions.

In addition, during the three months ended September 30, 2023, we and our unconsolidated joint venture partners incurred approximately $36.9 million of new tenant-related obligations associated with approximately 996,700 square feet of second generation leases, or approximately $37 per square foot.

We signed approximately 59,100 square feet of first generation leases.

The tenant-related obligations for the development properties are included within the projects’ “Estimated Total Investment” referred to in “Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources.” In aggregate during the third quarter of 2023, we signed leases for approximately 1.1 million square feet of space and incurred aggregate tenant-related obligations of approximately $59.9 million, or approximately $57 per square foot.

During the three months ended March 31, 2024, we paid approximately $83.0 million to fund tenant-related obligations, including tenant improvements and leasing commissions.

In addition, during the three months ended March 31, 2024, we and our unconsolidated joint venture partners incurred approximately $117.6 million of new tenant-related obligations associated with approximately 825,700 square feet of second generation leases, or approximately $142 per square foot.

We signed approximately 68,200

square feet of first generation leases.

The tenant-related obligations for the development properties are included within the projects’ “Estimated Total Investment” referred to in “Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources.” In aggregate during the first quarter of 2024, we signed leases for approximately 893,900 square feet of space and incurred aggregate tenant-related obligations of approximately $129.6 million, or approximately $145 per square foot.

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 2. Management’s Discussion and Analysis