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<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
JULY 27, 1999
BOSTON PROPERTIES, INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 1-13087 04-2473675
(State or other jurisdiction (Commission File (I.R.S. employer
of incorporation) Number) Identification No.)
800 BOYLSTON STREET
BOSTON, MASSACHUSETTS 02199
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code:
(617) 236-3300
<PAGE>
ITEM 5. OTHER EVENTS
Following the issuance of a press release on July 27, 1999, announcing
the Company's results for the second quarter ended June 30, 1999, the Company
intends to provide, to certain investors and analysts at their request,
supplemental information regarding the Company's operations that is to
voluminous for a press release. The Company is attaching this supplementary
operating and financial data as Exhibit 99.1 and the press release as Exhibit
99.2 to this Current Report on Form 8-K.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) Exhibits
EXHIBIT NO.
99.1 The Boston Properties, Inc. Supplemental Operating and Financial Data
for the quarter ended June 30, 1999.
99.2 The Boston Properties, Inc. press release dated July 27, 1999 for the
quarter ended June 30, 1999.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: July 28, 1999 BOSTON PROPERTIES, INC.
/s/ David G. Gaw
-------------------------------
By: David G. Gaw
Chief Financial Officer
<PAGE>
Exhibit 99.1
BOSTON PROPERTIES, INC.
Supplemental Operating and Financial Data
for the Quarter Ended June 30, 1999
<PAGE>
INDEX
<TABLE>
<CAPTION>
Page
----
<S> <C>
Company Background 2
Investor Information 3-4
Financial Highlights 5
Consolidated Balance Sheets 6
Consolidated Income Statements 7
Funds From Operations 8
Financial Ratios 9
Capital Structure 10
Debt Analysis 11
Joint Ventures 12
Portfolio Overview 13-14
Occupancy Analysis - same property 15
Office Properties 16
R&D Properties 17
Industrial Properties 18
Grand Total - Office, R&D and Industrial Properties 19
Hotel Performance 20
Same Property Performance 21
"In-Service" Property Performance 22
Capital Expenditures 23
Value Creation Pipeline - Acquisitions/Repositioning 24
Value Creation Pipeline - Development 25
Value Creation Pipeline - Land Parcels 26
Acquisition Property Profile 27
</TABLE>
1
<PAGE>
BOSTON PROPERTIES, INC.
SECOND QUARTER 1999
COMPANY BACKGROUND
Boston Properties is a fully integrated, self-administered and
self-managed real estate investment trust that develops, redevelops,
acquires, manages, operates and owns a diverse portfolio of office,
industrial and hotel properties. The Company is one of the largest
owners and developers of office properties in the United States,
concentrated in the Northeast Corridor from Virginia to Greater Boston
and in downtown San Francisco.
On June 23, 1997, Boston Properties successfully completed its initial
public offering. The offering and the underwriters over-allotment option
closed on the same date resulting in 36,110,000 shares being sold at
$25.00 per share for a total offering of $902,750,000. On January
30,1998, the Company closed a follow-on offering of 23,000,000 shares
(including the underwriters' over-allotment) at $35.125 per share for a
total offering of $807,875,000. On May 20, 1999, the Company raised an
additional $141,002,500, net of issuance costs, through the issuance of
4,000,000 shares.
Through its predecessor company founded by Mortimer B. Zuckerman and
Edward H. Linde in 1970, the Company grew through the seventies,
eighties, and nineties by developing and redeveloping Class A office
properties, R&D and industrial properties, and hotels in its primary
markets of greater Boston, greater Washington, DC, and midtown
Manhattan.
Since the Company's Initial Offering in June 1997, the Company has
acquired 41 properties adding approximately 14.9 million square feet to
its portfolio, representing an investment of approximately $3.6 billion.
In addition, the Company is developing eight Class A Office Buildings
for a total anticipated investment of approximately $493.3 million. The
Company owns or controls land where it can develop an additional 10.6
million square feet.
2
<PAGE>
BOSTON PROPERTIES, INC.
SECOND QUARTER 1999
INVESTOR INFORMATION
800 Boylston Street
Boston, MA 02199
(617) 236-3300
(617) 536-5087 (fax)
<TABLE>
<S> <C>
Mortimer B. Zuckerman Chairman of the Board
Edward H. Linde President, Chief Executive Officer and Director
Robert E. Burke Executive Vice President, Operations
Douglas T. Linde Senior Vice President, Financial and Capital Markets
David G. Gaw Senior Vice President, Chief Financial Officer
Elaine M. Quinlan Director of Investor Relations
</TABLE>
TIMING
Quarterly results will be announced according to the following anticipated
schedule:
<TABLE>
<S> <C>
Third Quarter Early November
Year End Early February
</TABLE>
3
<PAGE>
BOSTON PROPERTIES, INC.
SECOND QUARTER 1999
COMMON STOCK DATA (NYSE:BXP)
Boston Properties' common stock is traded primarily on the New York Stock
Exchange under the symbol: BXP. BXP's common stock has had the following
characteristics:
<TABLE>
<CAPTION>
2nd Quarter 1999 2nd Quarter 1998
---------------- ----------------
<S> <C> <C>
High Price $ 37.1250 $ 35.9375
Low Price $ 31.2500 $ 32.0625
Closing Price $ 35.8750 $ 34.00
Dividends per share - annualized $ 1.70 $ 1.62
Closing dividend yield - annualized 4.74% 4.76%
Closing shares, common units and preferred units (if converted) outstanding (thousands) 104,711 83,158
Closing market value of shares and units outstanding (thousands) $ 3,756,507 $ 2,827,372
</TABLE>
4
<PAGE>
BOSTON PROPERTIES, INC.
SECOND QUARTER 1999
FINANCIAL HIGHLIGHTS
(unaudited and in thousands)
<TABLE>
<CAPTION>
Three Months Ended
------------------------------------------
June 30, 1999 June 30, 1998 % Change
<S> <C> <C> <C>
Income Items:
Revenues $ 191,640 $ 108,041 77.38%
Net Income available to common shareholders $ 27,223 $ 29,921 (9.02%)
Funds from Operations $ 66,366 $ 50,707 30.88%
Company's share (73.34% and 76.79%) $ 48,673 $ 38,938 25.00%
Funds from Operations per share - basic $ 0.74 $ 0.63 17.89%
Funds from Operations per share - diluted $ 0.72 $ 0.63 14.89%
Dividends per share $ 0.425 $ 0.405 4.94%
Ratios:
Interest Coverage Ratio 2.54 3.19 (20.35%)
Dividend Payout Ratio 58.72% 64.17% (8.50%)
</TABLE>
<TABLE>
<CAPTION>
June 30, 1999 December 31, 1% Change
------------- ------------ ---------
<S> <C> <C> <C>
Capitalization:
Total Debt $2,941,507 $3,088,724 (4.77%)
Total Common Shares Outstanding @ Quarter End 67,893 63,528 6.87%
Total Preferred Shares Outstanding @ Quarter End
(if converted) 2,625 -- --
Total Common Units Outstanding @ Quarter End 23,817 23,798 0.08%
Total Preferred Units Outstanding @ Quarter End
(if converted) 10,376 10,454 (0.75%)
Price @ Quarter End $ 35.875 $ 30.500 17.62%
Equity Value @ Quarter End $3,756,507 $2,982,294 25.96%
Total Market Capitalization $6,698,014 $6,071,018 10.33%
Debt/Total Market Capitalization 43.92% 50.88% (13.68%)
</TABLE>
5
<PAGE>
BOSTON PROPERTIES, INC.
SECOND QUARTER 1999
CONSOLIDATED BALANCE SHEETS
(unaudited and in thousands)
<TABLE>
<CAPTION>
June 30, 1999 December 31, 1998
------------- -----------------
<S> <C> <C>
ASSETS
Real Estate and equipment $ 4,927,981 $ 4,755,436
Land and development in progress 199,488 191,436
Less accumulated depreciation (411,705) (357,384)
----------- -----------
Total real estate and equipment 4,715,764 4,559,809
Cash 32,225 12,166
Escrows 24,082 19,014
Notes receivable -- 420,143
Tenant and other receivables 53,059 40,830
Accrued rental income 72,535 64,251
Deferred charges, net 50,946 46,029
Prepaid expenses and other assets 28,142 26,058
Investment in joint ventures 42,077 46,787
----------- -----------
Total assets $ 5,018,830 $ 5,235,087
----------- -----------
----------- -----------
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Mortgage notes payable $ 2,799,507 $ 2,653,581
Notes payable 420,143
Unsecured line of credit 142,000 15,000
Accounts payable and accrued expenses 61,860 42,897
Dividends payable 45,559 40,494
Accrued interest payable 7,837 7,307
Other liabilities 22,946 27,950
----------- -----------
Total liabilities 3,079,709 3,207,372
----------- -----------
Commitments and contingencies -- --
Minority interests 781,999 1,105,864
Series A Convertible Redeemable Preferred Stock, liquidation preference
$50.00 per share, 2,000,000 shares issued and outstanding 100,000 --
Stockholders' Equity:
Excess stock, $.01 par value, 150,000,000 shares
authorized, none issued or outstanding -- --
Common stock, $.01 par value, 250,000,000 shares authorized,
67,893,386 and 63,527,819 issued and outstanding, respectively 678 635
Additional paid-in capital 1,068,016 929,081
Dividend in excess of earnings (11,572) (7,865)
----------- -----------
Total stockholders' equity 1,057,122 921,851
----------- -----------
Total liabilities and stockholders' equity $ 5,018,830 $ 5,235,087
----------- -----------
----------- -----------
</TABLE>
6
<PAGE>
BOSTON PROPERTIES, INC.
SECOND QUARTER 1999
CONSOLIDATED INCOME STATEMENTS
(unaudited and in thousands)
<TABLE>
<CAPTION>
Three Months Ended
------------------------------------
30-Jun-99 30-Jun-98 % Change
--------- --------- --------
<S> <C> <C> <C>
Revenue:
Rental
Base Rent $ 158,070 $ 87,806 80.02%
Recoveries from tenants 17,252 9,805 75.95%
Parking and other 12,087 1,595 657.81%
--------- --------- --------
Total rental revenue 187,409 99,206 813.78%
Development and management services 3,611 4,383 (17.61%)
Interest and other 620 4,452 (86.07%)
--------- --------- --------
Total revenue 191,640 108,041 77.38%
--------- --------- --------
Expenses:
Rental expenses 60,306 27,403 120.07%
General and administrative 7,352 5,800 26.76%
Interest 49,219 23,814 106.68%
Depreciation and amortization 29,443 16,594 77.43%
--------- --------- --------
Total expenses 146,320 73,611 98.77%
--------- --------- --------
Income before minority interests and before income from unconsolidated joint venture 45,320 34,430 31.63%
Minority interest in property partnership (139) (106) 31.13%
Income from unconsolidated joint venture 229 -- --
--------- --------- --------
Income before minority interest in Operating Partnership 45,410 34,324 32.30%
Preferred distribution (6,611) -- --
Minority interest in Operating Partnership (1) (9,894) (7,967) 24.19%
--------- --------- --------
Income before preferred dividend 28,905 26,357 9.67%
Preferred dividend (1,682) -- --
--------- --------- --------
Income before extraordinary gain 27,223 26,357 3.29%
Extraordinary gain on early debt extinguishment, net -- 3,564 (100.00%)
--------- --------- --------
Net income available to common shareholders $ 27,223 $ 29,921 (9.02%)
--------- --------- --------
--------- --------- --------
INCOME PER SHARE OF COMMON STOCK
Income before extraordinary item $ 0.42 $ 0.42 (1.09%)
--------- --------- --------
--------- --------- --------
Net income available to common shareholders $ 0.42 $ 0.48 (13.46%)
--------- --------- --------
--------- --------- --------
</TABLE>
(1) Equals minority interest percent (26.66%) of income before minority
interest in Operating Partnership after deduction for preferred dividends and
distributions.
7
<PAGE>
BOSTON PROPERTIES, INC.
SECOND QUARTER 1999
FUNDS FROM OPERATIONS
(in thousands, except for per share amounts)
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended
----------------------------------
Actual Actual
30-Jun-99 30-Jun-98 % Change
<S> <C> <C> <C>
Income from operations before minority interests and before income from unconsolidated
joint venture $ 45,320 $ 34,430 31.63%
Add:
Real estate depreciation and amortization 29,238 16,415 78.12%
Income from unconsolidated joint venture 229 --
Less:
Minority property partnership's share of funds from operations (128) (138) (7.25%)
Preferred allocation (8,293) -- --
-------- -------- -----
Funds from Operations $ 66,366 $ 50,707 30.88%
-------- -------- -----
-------- -------- -----
Funds from Operations available to common shareholders (1) $ 48,673 $ 38,938 25.00%
-------- -------- -----
-------- -------- -----
Funds from Operations per share - basic $ 0.74 $ 0.63 17.89%
-------- -------- -----
-------- -------- -----
Weighted average shares outstanding - basic 65,534 61,694 6.22%
-------- -------- -----
-------- -------- -----
Funds from Operations per share - diluted $ 0.72 $ 0.63 14.29%
-------- -------- -----
-------- -------- -----
Weighted average shares outstanding - diluted 79,329 62,284 27.37%
-------- -------- -----
-------- -------- -----
</TABLE>
(1) Based on weighted average shares for the quarter. Company's share
for the quarter ended 6/30/99 was 73.34% and 76.79% for the quarter ended
6/30/98.
RECONCILIATION TO DILUTED FUNDS FROM OPERATIONS
<TABLE>
<CAPTION>
For the Three Months Ended June 30, 1999 For the Three Months Ended June 30, 1998
---------------------------------------- ----------------------------------------
Income Shares Per Share Income Shares Per Share
(Numerator)(Denominator) Amount (Numerator) (Denominator) Amonut
---------- ------------- ------ ----------- ------------- ------
<S> <C> <C> <C> <C> <C> <C>
Basic Funds from Operations $66,366 89,352 $ 0.74 $50,707 80,344 $ 0.63
Effect of Dilutive Securities
Convertible Preferred Units 6,611 10,364 (0.01) -- -- --
Convertible Preferred Stock 1,682 2,625 -- -- -- --
Stock Options -- 806 (0.01) -- 590 --
------- ------ -------- ------- ------ --------
Dilutive Funds from Operations (1) $74,659 103,147 $ 0.72 $50,707 80,934 $ 0.63
------- ------ -------- ------- ------ --------
------- ------ -------- ------- ------ --------
Company's share of Diluted Funds from Operations $57,419 79,329 $ 0.72 $38,938 62,284 $ 0.63
------- ------ -------- ------- ------ --------
------- ------ -------- ------- ------ --------
</TABLE>
(1) Based on weighted average diluted shares for the quarter. Company's
share for the quarter ended 6/30/99 was 76.91% and 76.96% for the quarter ended
6/30/98.
8
<PAGE>
BOSTON PROPERTIES, INC.
SECOND QUARTER 1999
FINANCIAL RATIOS
<TABLE>
<CAPTION>
Three months ended
June 30, 1999
-------------
<S> <C>
RATIOS COMPUTED FOR INDUSTRY COMPARISONS:
OPERATIONAL RATIOS (1,2)
Debt Service Coverage Ratio 2.28
(EBITDA + Income from Unconsolidated Joint Ventures)/(Interest+Principal)
Interest Coverage Ratio 2.54
(EBITDA + Income from Unconsolidated Joint Venture)/Interest
Return on Shareholder's Equity 15.87%
(EBITDA - Interest)/Average Equity (book value) (%)
Return on Real Estate Investments 10.55%
(EBITDA/Average Real Estate Investments (book value)) (%)
FFO Payout Ratio 59.03%
(Dividends Declared/FFO) (%)
</TABLE>
(1) EBITDA is equal to earnings before interest, taxes,
depreciation and amortization.
(2) FFO is calculated based on the NAREIT White Paper.
9
<PAGE>
BOSTON PROPERTIES, INC.
SECOND QUARTER 1999
CAPITAL STRUCTURE
DEBT
(IN THOUSANDS)
<TABLE>
<CAPTION>
AGGREGATE PRINCIPAL
JUNE 30, 1999
-------------
<S> <C>
Mortgage Loans $2,799,507
Unsecured Line of Credit 142,000
----------
Total Debt $2,941,507
----------
----------
</TABLE>
EQUITY
(IN THOUSANDS)
<TABLE>
<CAPTION>
COMMON
SHARES & UNITS STOCK $ VALUE
OUTSTANDING EQUIVALENTS EQUIVALENT (1)
----------- ----------- --------------
<S> <C> <C> <C>
Common Stock 67,893 67,893 $2,435,661
Preferred Stock 2,000 2,625 94,172
Operating Partnership Units 23,817 23,817 854,435
Preferred Operating Partnership Units 8,713 10,376 372,239
------ -------
Total Equity 104,711 $3,756,507
------- ----------
------- ----------
Total Market Capitalization $6,698,014
----------
----------
</TABLE>
(1) Value based on June 30, 1999 closing price of $35.875.
10
<PAGE>
BOSTON PROPERTIES, INC.
SECOND QUARTER 1999
DEBT ANALYSIS
LONG-TERM DEBT MATURITIES AND PRINCIPAL PAYMENTS
(IN THOUSANDS)
<TABLE>
<CAPTION>
YEAR 1999 2000 2001 2002 2003 THEREAFTER TOTAL
---- ---- ---- ---- ---- ---- ---------- -----
<S> <C> <C> <C> <C> <C> <C> <C>
Amount $33,186 263,460 154,384 392,234 217,056 1,881,187 $2,941,507
</TABLE>
UNSECURED LINE OF CREDIT - DUE JUNE 23, 2000
(IN THOUSANDS)
<TABLE>
<CAPTION>
OUTSTANDING LETTERS OF REMAINING
FACILITY AT 6/30/99 CREDIT CAPACITY
-------- ---------- ------ --------
<S> <C> <C> <C>
$500,000 142,000 28,050 $329,950
</TABLE>
UNSECURED AND SECURED DEBT ANALYSIS
<TABLE>
<CAPTION>
WEIGHTED WEIGHTED AVERAGE
% OF DEBT AVERAGE RATE MATURITY
--------- ------------ --------
<S> <C> <C> <C>
Unsecured Debt 4.83% 6.63% 1.0 years
Secured Debt 95.17% 7.00% 5.9 years
------ ---- ---------
Total Debt 100.00% 6.98% 5.7 years
------ ---- ---------
------ ---- ---------
</TABLE>
FLOATING AND FIXED RATE DEBT ANALYSIS
<TABLE>
<CAPTION>
WEIGHTED WEIGHTED AVERAGE
% OF DEBT AVERAGE RATE MATURITY
--------- ------------ --------
<S> <C> <C> <C>
Floating Rate Debt 5.07% 6.58% 1.1 years
Fixed Rate Debt 94.93% 7.01% 5.9 years
------ ---- ---------
Total Debt 100.00% 6.98% 5.7 years
------ ---- ---------
------ ---- ---------
</TABLE>
11
<PAGE>
BOSTON PROPERTIES, INC.
SECOND QUARTER 1999
JOINT VENTURE ANALYSIS
as of June 30, 1999
<TABLE>
<CAPTION>
ONE AND TWO ONE MARKET
RESTON FREEDOM SQUARE
OVERLOOK SQUARE NORTH COMBINED
------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Total Equity (1) $ 4,500 $ 4,917 $32,660 $42,077
------- ------- ------- -------
------- ------- ------- -------
Construction loans payable (1) $12,248 $ 8,664 $17,891 $38,802
------- ------- ------- -------
------- ------- ------- -------
BXP's ownership percentage 25.00% 25.00% 50.00%
------- ------- -------
------- ------- -------
</TABLE>
(1) Represents the Company's share.
RESULTS OF OPERATIONS FOR THE IN-SERVICE JOINT VENTURE
FOR THE QUARTER ENDED JUNE 30, 1999
<TABLE>
<CAPTION>
ONE AND TWO
RESTON
OVERLOOK
--------
<S> <C>
REVENUE
Total rental revenue $2,635
Interest and other 12
------
Total revenue 2,647
------
EXPENSES
Operating 768
Interest 506
Depreciation and amortization 449
------
Total expenses 1,723
------
Net income $ 924
------
------
</TABLE>
12
<PAGE>
BOSTON PROPERTIES, INC.
SECOND QUARTER 1999
PORTFOLIO OVERVIEW
RENTABLE SQUARE FEET OF IN-SERVICE PROPERTIES BY LOCATION AND TYPE OF PROPERTY
<TABLE>
<CAPTION>
GEOGRAPHIC AREA OFFICE (1) R&D INDUSTRIAL TOTAL % OF TOTAL
--------------- ---------- --- ---------- ----- ----------
<S> <C> <C> <C> <C> <C>
Greater Boston 5,408,645 545,206 247,318 6,201,169 25.80%
Greater Washington, D.C 5,076,598(2) 1,382,632 236,743 6,695,973 27.86%
Greater San Francisco 4,009,536 143,844 280,213 4,433,593 18.45%
Midtown Manhattan 2,874,854 -- -- 2,874,854 11.96%
Princeton/East Brunswick, NJ 1,599,866 -- -- 1,599,866 6.66%
Baltimore, MD 1,166,797 -- -- 1,166,797 4.85%
Richmond, VA 899,727 -- -- 899,727 3.75%
Bucks County, PA -- -- 161,000 161,000 0.67%
---------- --------- ------- ---------- ------
Total 21,036,023 2,071,682 925,274 24,032,979 100.00%
---------- --------- ------- ---------- ------
---------- --------- ------- ---------- ------
% of Total 87.53% 8.62% 3.85% 100.00%
</TABLE>
(1) Includes retail square footage of approximately 1,000,000.
(2) Includes 444,286 square feet at One and Two Reston Overlook which are
25% owned by Boston Properties.
HOTEL PROPERTIES
<TABLE>
<CAPTION>
NUMBER OF SQUARE
HOTEL PROPERTIES ROOMS FEET
---------------- ----- ----
<S> <C> <C>
Long Wharf Marriott, Boston, MA 402 420,000
Cambridge Center Marriott, Cambridge, MA 431 330,400
Residence Inn by Marriott, Cambridge, MA 221 187,474
Total Hotel Properties 1,054 937,874
</TABLE>
GARAGE PROPERTY AND STRUCTURED PARKING
<TABLE>
<CAPTION>
Number of Square
Spaces Feet
------ ----
<S> <C> <C>
Garage Properties
Cambridge Center North Garage 1,170 332,442
Structured Parking 16,726 5,851,221
------ ---------
Total Garage Property and Structured Parking 17,896 6,183,663
------ ---------
------ ---------
</TABLE>
<PAGE>
BOSTON PROPERTIES, INC.
SECOND QUARTER 1999
PORTFOLIO OVERVIEW
PERCENTAGE OF PROPERTY FUNDS FROM OPERATIONS* FOR IN-SERVICE PROPERTIES BY
LOCATION AND TYPE OF PROPERTY FOR THE QUARTER ENDED JUNE 30, 1999
<TABLE>
<CAPTION>
GEOGRAPHIC AREA OFFICE (1) R&D INDUSTRIAL HOTEL GARAGE TOTAL
- --------------- ---------- --- ---------- ----- ------ -----
<S> <C> <C> <C> <C> <C> <C>
Greater Boston 18.1% 0.9% 0.2% 6.0% 0.3% 25.5%
Greater Washington,D.C. 21.2% 3.0% 0.2% n/a n/a 24.4%
Greater San Francisco 19.4% 0.2% 0.1% n/a n/a 19.7%
Midtown Manhattan 17.8% n/a n/a n/a n/a 17.8%
Baltimore, MD 4.3% n/a n/a n/a n/a 4.3%
Richmond, VA 3.2% n/a n/a n/a n/a 3.2%
Princeton/East
Brunswick, NJ 5.0% n/a n/a n/a n/a 5.0%
Bucks County, PA n/a n/a 0.1% n/a n/a 0.1%
---- --- --- --- --- -----
Total 88.9% 4.1% 0.7% 6.0% 0.3% 100.0%
---- --- --- --- --- -----
---- --- --- --- --- -----
</TABLE>
(1)Includes Retail Center FFO (Prudential Center Boston and Embarcadero Center).
* For this table, Property Funds from Operations is equal to GAAP basis
property NOI which includes the effect of straight-line rent and excludes any
deduction for interest expense.
14
<PAGE>
BOSTON PROPERTIES, INC.
SECOND QUARTER 1999
OCCUPANCY ANALYSIS
SAME PROPERTY OCCUPANCY - BY LOCATION
<TABLE>
<CAPTION>
LOCATION 30-JUN-99 30-JUN-98
-------- --------- ---------
<S> <C> <C>
Greater Boston, MA 96.3% 98.4%
Greater Washington, D.C. 97.7% 98.7%
Midtown Manhattan, NY 99.9% 97.8%
Baltimore, MD 100.0% 99.7%
Princeton/East Brunswick, NJ n/a n/a
Richmond, VA 96.2% 97.4%
Greater San Francisco, CA 94.7% 98.8%
Bucks County, PA 100.0% 100.0%
----- -----
Total Portfolio 97.8% 98.4%
----- -----
----- -----
</TABLE>
SAME PROPERTY - BY TYPE OF PROPERTY
<TABLE>
<CAPTION>
30-JUN-99 30-JUN-98
--------- ---------
<S> <C> <C>
Total Office Portfolio 98.7% 98.7%
Total R&D Portfolio 96.8% 98.6%
Total Industrial Portfolio 90.4% 95.0%
---- ----
Total Portfolio 97.8% 98.4%
---- ----
---- ----
</TABLE>
15
<PAGE>
BOSTON PROPERTIES, INC.
SECOND QUARTER 1999
IN-SERVICE OFFICE PROPERTIES
LEASE EXPIRATIONS
<TABLE>
<CAPTION>
ANNUALIZED
RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER
YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES PERCENTAGE OF TOTAL
EXPIRATION EXPIRING LEASES EXPIRING LEASES WITH FUTURE STEP-UPS SQUARE FEET EXPIRING
- ---------- --------------- --------------- -------------------- --------------------
<S> <C> <C> <C> <C>
1999* 758,372 22,279,143 22,279,143 3.81%
2000 1,611,624 44,788,233 44,938,176 8.10%
2001 2,010,514 59,912,803 60,526,202 10.10%
2002 2,004,431 77,131,218 78,138,100 10.07%
2003 1,500,731 44,944,432 46,041,624 7.54%
2004 1,932,827 61,298,259 65,529,629 9.71%
2005 1,365,669 38,379,696 41,464,191 6.86%
2006 2,537,541 81,208,032 89,266,992 12.75%
2007 1,956,197 70,296,176 70,067,084 9.83%
Thereafter 4,219,347 135,285,493 154,047,432 21.21%
</TABLE>
* July 1, 1999 through December 31, 1999
OCCUPANCY BY LOCATION
<TABLE>
<CAPTION>
30-JUN-99 30-JUN-98
--------- --------
<S> <C> <C>
Greater Boston, MA 96.8% 98.7%
Greater Washington, D.C 97.3% 99.6%
Midtown Manhattan, NY 99.9% 97.8%
Baltimore, MD 100.0% 99.7%
Richmond, VA 96.2% 97.4%
Princeton/East Brunswick, NJ 99.8% 100.0%
Greater San Francisco, CA 98.3% n/a
Bucks County, PA n/a n/a
--------- --------
Total Office Portfolio 98.0% 98.9%
--------- --------
--------- --------
</TABLE>
16
<PAGE>
BOSTON PROPERTIES, INC.
SECOND QUARTER 1999
IN-SERVICE R&D PROPERTIES
LEASE EXPIRATIONS
<TABLE>
<CAPTION>
ANNUALIZED
RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER
YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES PERCENTAGE OF TOTAL
EXPIRATION EXPIRING LEASES EXPIRING LEASES WITH FUTURE STEP-UPS SQUARE FEET EXPIRING
- ---------- --------------- --------------- -------------------- --------------------
<S> <C> <C> <C> <C>
1999* 142,887 1,476,638 1,476,638 7.01%
2000 465,041 4,795,486 4,837,540 22.81%
2001 196,344 2,232,295 2,322,496 9.63%
2002 344,671 4,606,923 4,756,162 16.91%
2003 91,212 1,175,906 1,210,434 4.47%
2004 50,533 664,118 746,802 2.48%
2005 146,741 1,735,930 1,858,276 7.20%
2006 150,000 1,633,004 1,820,504 7.36%
2007 107,895 2,239,757 2,291,792 5.29%
Thereafter 343,402 5,409,286 6,619,222 16.84%
</TABLE>
* July 1, 1999 through December 31, 1999
OCCUPANCY BY LOCATION
<TABLE>
<CAPTION>
30-JUN-99 30-JUN-98
--------- ---------
<S> <C> <C>
Greater Boston, MA 100.0% 100.0%
Greater Washington, D.C 94.8% 97.7%
Midtown Manhattan, NY n/a n/a
Baltimore, MD n/a n/a
Richmond, VA n/a n/a
Princeton/East Brunswick, NJ n/a n/a
Greater San Francisco, CA 98.4% 96.3%
Bucks County, PA n/a n/a
--------- ---------
Total R&D Portfolio 96.4% 98.2%
--------- ---------
--------- ---------
</TABLE>
17
<PAGE>
BOSTON PROPERTIES, INC.
SECOND QUARTER 1999
IN-SERVICE INDUSTRIAL PROPERTIES
LEASE EXPIRATIONS
<TABLE>
<CAPTION>
ANNUALIZED
RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER
YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES PERCENTAGE OF TOTAL
EXPIRATION EXPIRING LEASES EXPIRING LEASES WITH FUTURE STEP-UPS SQUARE FEET EXPIRING
<S> <C> <C> <C> <C>
1999* 63,904 347,221 347,221 7.64%
2000 249,280 1,478,608 1,478,608 29.80%
2001 70,829 361,882 361,882 8.47%
2002 -- -- -- 0.00%
2003 153,430 949,947 1,046,026 18.34%
2004 195,076 946,510 1,004,186 23.32%
2005 20,500 122,297 140,199 2.45%
2006 -- -- -- 0.00%
2007 -- -- -- 0.00%
Thereafter 83,608 728,226 728,226 9.99%
</TABLE>
* July 1, 1999 through December 31, 1999
OCCUPANCY BY LOCATION
<TABLE>
<CAPTION>
30-JUN-99 30-JUN-98
--------- ---------
<S> <C> <C>
Greater Boston, MA 93.0% 93.0%
Greater Washington, D.C 78.3% 87.8%
Midtown Manhattan, NY n/a n/a
Baltimore, MD n/a n/a
Richmond, VA n/a n/a
Princeton/East Brunswick, NJ n/a n/a
Greater San Francisco, CA 92.9% 100.0%
Bucks County, PA 100.0% 100.0%
--------- ---------
Total Industrial Portfolio 90.4% 95.0%
--------- ---------
--------- ---------
</TABLE>
18
<PAGE>
BOSTON PROPERTIES, INC.
SECOND QUARTER 1999
GRAND TOTAL OF ALL
IN-SERVICE PROPERTIES
LEASE EXPIRATION
<TABLE>
<CAPTION>
ANNUALIZED
RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER
YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES PERCENTAGE OF TOTAL
EXPIRATION EXPIRING LEASES EXPIRING LEASES WITH FUTURE STEP-UPS SQUARE FEET EXPIRING
- ---------- --------------- --------------- -------------------- --------------------
<S> <C> <C> <C> <C>
1999* 965,163 24,103,002 24,103,002 4.24%
2000 2,325,945 51,062,327 51,254,324 10.21%
2001 2,277,687 62,506,980 63,210,580 10.00%
2002 2,349,102 81,738,141 82,894,262 10.32%
2003 1,745,373 47,070,285 48,298,084 7.66%
2004 2,178,436 62,908,887 67,280,617 9.57%
2005 1,532,910 40,237,923 43,462,666 6.73%
2006 2,687,541 82,841,036 91,087,496 11.80%
2007 2,064,092 72,535,933 72,358,876 9.06%
Thereafter 4,646,357 141,423,005 161,394,880 20.40%
</TABLE>
* July 1, 1999 through December 31, 1999
OCCUPANCY BY LOCATION
<TABLE>
<CAPTION>
30-JUN-99 30-JUN-98
--------- ---------
<S> <C> <C>
Greater Boston, MA 96.9% 98.5%
Greater Washington, D.C 96.1% 98.6%
Midtown Manhattan, NY 99.9% 97.8%
Baltimore, MD 100.0% 99.7%
Richmond, VA 96.2% 97.4%
Princeton/East Brunswick, NJ 99.8% 100.0%
Greater San Francisco, CA 98.0% 98.8%
Bucks County, PA 100.0% 100.0%
--------- ---------
Total Portfolio 97.6% 98.5%
--------- ---------
--------- ---------
</TABLE>
19
<PAGE>
BOSTON PROPERTIES, INC.
SECOND QUARTER 1999
HOTEL PERFORMANCE
SAME PROPERTY HOTELS
Long Wharf Marriott - Boston
<TABLE>
<CAPTION>
SECOND QUARTER SECOND QUARTER PERCENT YTD YTD PERCENT
1999 1998 CHANGE 1999 1998 CHANGE
<S> <C> <C> <C> <C> <C> <C>
Occupancy 88.00% 88.20% -0.23% 86.80% 87.70% -1.0%
Average Daily Rate $246.09 $245.27 0.33% $218.06 $210.66 3.5%
REVPAR $216.56 $216.33 0.11% $189.28 $184.75 2.5%
</TABLE>
Cambridge Center Marriott
<TABLE>
<CAPTION>
SECOND QUARTER SECOND QUARTER PERCENT YTD YTD PERCENT
1999 1998 CHANGE 1999 1998 CHANGE
<S> <C> <C> <C> <C> <C> <C>
Occupancy 85.50% 89.20% -4.15% 84.10% 83.20% 1.1%
Average Daily Rate $198.18 $193.69 2.32% $178.81 $176.46 1.3%
REVPAR $169.44 $172.77 -1.93% $150.38 $146.81 2.4%
</TABLE>
Total Same Property Hotel Performance
<TABLE>
<CAPTION>
SECOND QUARTER SECOND QUARTER PERCENT YTD YTD PERCENT
1999 1998 CHANGE 1999 1998 CHANGE
<S> <C> <C> <C> <C> <C> <C>
Occupancy 86.71% 88.70% -2.24% 85.40% 85.40% 0.0%
Average Daily Rate $221.30 $218.46 1.30% $197.75 $192.96 2.5%
REVPAR $192.18 $193.68 -0.77% $169.15 $165.12 2.4%
</TABLE>
NEWLY PLACED-IN-SERVICE HOTEL
Residence Inn by Marriott
<TABLE>
<CAPTION>
SECOND QUARTER SECOND QUARTER PERCENT YTD YTD PERCENT
1999 1998 CHANGE 1999 1998 CHANGE
<S> <C> <C> <C> <C> <C> <C>
Occupancy 84.40% N/A N/A 77.80% N/A N/A
Average Daily Rate $153.36 N/A N/A $146.98 N/A N/A
REVPAR $129.44 N/A N/A $114.35 N/A N/A
</TABLE>
20
<PAGE>
BOSTON PROPERTIES, INC.
SECOND QUARTER 1999
SAME PROPERTY PERFORMANCE
OFFICE, R&D, INDUSTRIAL AND HOTEL PROPERTIES
<TABLE>
<CAPTION>
OFFICE R&D INDUSTRIAL HOTEL GARAGE TOTAL
<S> <C> <C> <C> <C> <C> <C>
Number of Properties 43 31 9 2 1 86
Square feet 10,002,668 2,011,145 925,274 750,400 332,442 14,021,929
Percent of in-service properties 47.6% 97.1% 100.0% 80.0% 100% 55.8%
Occupancy @ 6/30/98 98.7% 98.6% 95.0% -- -- 98.4%
Occupancy @ 6/30/99 98.7% 96.8% 90.4% -- -- 97.8%
Percent change from 2nd quarter 1999
over 2nd quarter 1998:
Revenue 4.1% 4.4% 2.7% 5.1% 17.8% 4.3%
Expense 6.0% 8.3% 28.0% 15.0% 69.7% 6.9%
Net Operating Income 3.4% 3.4% -4.7% 3.7% -2.3% 3.3%
</TABLE>
SAME PROPERTY LEASE ANALYSIS - QUARTER ENDED JUNE 30, 1999
<TABLE>
<CAPTION>
OFFICE R&D INDUSTRIAL TOTAL
<S> <C> <C> <C> <C>
Vacant space available @ 4/1/99 (sf) 71,816 10,929 98,972 181,717
Square footage of leases expiring or
terminated 4/1/99-6/30/99 286,452 67,119 83,608 437,179
------- ------- ------- --------
Total space for lease (sf) 358,268 78,048 182,580 618,896
------- ------- ------- --------
New tenants (sf) 144,336 3,500 93,933 241,769
Renewals (sf) 82,426 10,280 -- 92,706
------- ------- ------- --------
Total space leased (sf) 226,762 13,780 93,933 334,475
------- ------- ------- --------
------- ------- ------- --------
Space available @ 6/30/99 (sf) 131,506 64,268 88,647 284,421
------- ------- ------- --------
------- ------- ------- --------
Net increase (decrease) in leased space (sf) (59,690) (53,339) 10,325 (102,704)
Average lease term (months) 31 22 99 49
2nd generation TI/Comm PSF $7.00 $1.37 $12.40 $8.28
Increase in 2nd generation net rents (2) 19.5% 30.6% 22.3% 20.3%
</TABLE>
(1) For this table, Funds from Operations is equal to GAAP basis property NOI
which includes the effect of straight-line rent and excludes any deduction
for interest expense.
(2) Represents increase in net rents on a "cash to cash" basis. (Actual net
rent at time of expiration vs. initial net rent of new lease.)
21
<PAGE>
BOSTON PROPERTIES, INC.
SECOND QUARTER 1999
ALL "IN-SERVICE" PROPERTIES - QUARTER ENDED JUNE 30, 1999
<TABLE>
<CAPTION>
OFFICE R&D INDUSTRIAL TOTAL
------ --- ---------- -----
<S> <C> <C> <C> <C>
Vacant space available @ 4/1/99 (sf) 323,854 20,991 98,972 443,817
Vacant space from new acquisitions
and development 53,424 -- -- 53,424
Square footage of leases expiring or
terminated 4/1/99-6/30/99 759,508 67,119 83,608 910,235
---------- ---------- ---------- ----------
Total space for lease (sf) 1,136,786 88,110 182,580 1,407,476
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
New tenants (sf) 426,913 3,500 93,933 524,346
Renewals (sf) 292,280 10,280 -- 302,560
---------- ---------- ---------- ----------
Total space leased (sf) 719,193 13,780 93,933 826,906
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Space available @ 6/30/99 (sf) 417,593 74,330 88,647 580,570
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Net increase/(decrease) in leased space (sf) (93,739) (53,339) 10,325 (136,753)
Average lease term (months) 47 22 99 52
2nd generation TI/Comm PSF $ 7.22 $ 1.37 $ 12.40 $ 7.71
Increase in 2nd generation net rents (1) 16.4% 30.6% 22.3% 17.1%
</TABLE>
(1) Represents increase in net rents on a "cash to cash" basis (actual net
rent at time of expiration vs. initial net rent of new lease).
22
<PAGE>
BOSTON PROPERTIES, INC.
SECOND QUARTER 1999
HISTORICALLY GENERATED CAPITAL EXPENDITURES,
TENANT IMPROVEMENT COSTS AND LEASING COMMISSIONS
HISTORICAL CAPITAL EXPENDITURES
<TABLE>
<CAPTION>
1/1-6/30
1993 1994 1995 1996 1997 1998 1999
------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
Recurring capital expenditures $1,547 $1,812 $1,618 $1,083 $1,125 $3,543 $4,126
------ ------ ------ ------ ------ ------ ------
------ ------ ------ ------ ------ ------ ------
Hotel improvements, equipment upgrades
and replacements $ 836 $1,917 $4,420 $3,041 $2,625 $3,872 $1,001
------ ------ ------ ------ ------ ------ ------
------ ------ ------ ------ ------ ------ ------
</TABLE>
2ND GENERATION TENANT IMPROVEMENTS AND LEASING COMMISSIONS
<TABLE>
<CAPTION>
1/1-6/30
1993 1994 1995 1996 1997 1998 1999
--------- ----------- ------- -------- ---------- -------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Office
Square feet 451,295 690,459 768,459 970,072 1,016,427 648,291 1,055,506
--------- ----------- ------- -------- ---------- -------- ----------
Tenant improvement and
lease commissions p.s.f $ 8.45 $ 9.45 $ 10.66 $ 11.40 $ 10.83 $ 9.82 $ 9.81
--------- ----------- ------- -------- ---------- -------- ----------
R&D
Square feet 166,957 276,332 177,073 337,676 169,878 113,428 27,001
--------- ----------- ------- -------- ---------- -------- ----------
Tenant improvement and
lease commissions p.s.f $ 5.53 $ 0.68 $ 6.99 $ 10.45 $ 2.22 $ 3.32 $ 1.65
--------- ----------- ------- -------- ---------- -------- ----------
Industrial
Square feet 241,500 132,521 308,388 128,148 258,795 320,608 93,933
--------- ----------- ------- -------- ---------- -------- ----------
Tenant improvement and
lease commissions p.s.f $ 0.28 $ 3.32 $ 1.00 $ 1.71 $ 0.99 $ 1.13 $ 12.40
--------- ----------- ------- -------- ---------- -------- ----------
Average tenant improvement
and lease commission p.s.f $ 5.59 $ 6.51 $ 7.77 $ 10.31 $ 8.06 $ 6.57 $ 9.83
--------- ----------- ------- -------- ---------- -------- ----------
--------- ----------- ------- -------- ---------- -------- ----------
</TABLE>
23
<PAGE>
VALUE CREATION PIPELINE - ACQUISITIONS/REPOSITIONING
AS OF JUNE 30, 1999
<TABLE>
<CAPTION>
ANTICIPATED
INITIAL FUTURE TOTAL CURRENT
PROPERTY DATE ACQUIRED SQUARE FEET INVESTMENT INVESTMENT INVESTMENT OCCUPANCY
--------- -------------- -------------- -------------- ---
<S> <C> <C> <C> <C> <C> <C>
ACQUISITIONS
Class A Office Buildings
Embarcadero Center Nov-98/Feb-99 4,009,536 $1,216,000,000 $ 37,710,000 $1,253,710,000 98%
Sumner Square Mar-99 205,391 32,600,000 3,500,000 36,100,000 67%
510 Carnegie Center Apr-99 234,160 48,000,000 -- 48,000,000 100%
--------- -------------- -------------- -------------- ---
Total Value Creation Pipeline -
Acquisitions 4,449,087 $1,296,600,000 $ 41,210,000 $1,337,810,000 97%
--------- -------------- -------------- -------------- ---
--------- -------------- -------------- -------------- ---
</TABLE>
REPOSITIONS PLACED IN SERVICE DURING 1999
<TABLE>
<CAPTION>
ANTICIPATED
DATE PLACED INITIAL ADDITIONAL TOTAL PERCENT
IN SERVICE SQUARE FEET INVESTMENT COSTS TO DATE INVESTMENT LEASED
---------- ----------- ---------- ------------- ---------- ------
<S> <C> <C> <C> <C> <C> <C>
CLASS A OFFICE BUILDING
1301 New York Avenue Feb-99 177,249 $28,000,000 $11,830,928 $46,200,000 100%
</TABLE>
24
<PAGE>
VALUE CREATION PIPELINE - CONSTRUCTION IN PROGRESS
AS OF JUNE 30, 1999
<TABLE>
<CAPTION>
Estimated
Placed Anticipated
In Service # of Square Investment Total Percentage
Development Properties Date Location Buildings feet to Date Investment Leased (3)
---------------------- ---------- -------------- --------- --------- ------------ ------------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Class A Office Buildings
181 Spring Street Q41999 Lexington, MA 1 53,306 10,343,034 12,000,000 0%
One Freedom Square
(25% ownership) Q4 1999 Reston, VA 1 406,980 14,129,838 19,200,000(1) 76%
502 Carnegie Center Q4 1999 Princeton, NJ 1 114,910 11,872,808 19,300,000 21%
Orbital Sciences Phase I -
Building 1 & 2 Q2 2000 Loudon, VA 2 185,028 5,887,181 33,100,000 100%
Market Square North
(50% ownership) Q4 2000 Washington, DC 1 409,843 45,396,711 70,900,000(2) 39%
New Dominion Tech Park -
Building 1 Q4 2000 Herndon, VA 1 235,201 6,204,992 48,800,000 100%
111 Huntington Avenue
- Prudential Center Q3 2001 Boston, MA 1 890,000 34,752,933 290,000,000 28%(4)
--------- --------- ------------ ------------- ---
Total Development Properties 8 2,295,268 $128,587,497 $ 493,300,000 51%
--------- --------- ------------ ------------- ---
--------- --------- ------------ ------------- ---
</TABLE>
DEVELOPMENTS PLACED-IN-SERVICE DURING 1999
<TABLE>
<CAPTION>
PLACED
IN SERVICE # OF INVESTMENT TOTAL PERCENTAGE
DATE LOCATION BUILDINGS SQUARE FEET TO DATE INVESTMENT LEASED (3)
---------- -------- --------- ----------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Class A Office Buildings
One and Two Reston Overlook
(25% ownership) Q1-Q2 1999 Reston, VA 2 444,286 $ 16,114,171 $ 18,100,000(1) 100%
200 West Street Q2 1999 Waltham, MA 1 248,341 40,003,400 43,400,000 95%
Eight Cambridge Center Q2 1999 Cambridge, MA 1 177,226 23,754,529 26,000,000 100%
The Arboretum Q2 1999 Reston, VA 1 95,584 13,435,420 16,200,000 100%
Hotels
Residence Inn by Marriott Q1 1999 Cambridge, MA 1 187,474 26,789,664 32,000,000 n/a
-------- ------- ---------- ---------- ---------
Total 6 1,152,911 $ 120,097,184 $ 135,700,000 99%
-------- ------- ---------- ---------- ---------
-------- ------- ---------- ---------- ---------
</TABLE>
(1) Represents 25% of the total anticipated project-level investment.
(2) Represents 50% of the total anticipated project-level investment which
includes residential.
(3) as of July 22, 1999.
(4) 30% of available office space.
25
<PAGE>
VALUE CREATION PIPELINE - OWNED LAND PARCELS
as of June 30, 1999
<TABLE>
<CAPTION>
NO. OF DEVELOPABLE
LOCATION PARCELS ACREAGE SQUARE FEET
-------- ------- ------- -----------
<S> <C> <C> <C>
Dulles, VA 6 91.1 1,200,000
Rockville, MD 7 128.3 2,331,000
Reston, VA 2 8.8 775,000
Herndon, VA 1 17.0 214,799
Andover, MA 2 27.0 290,000
Springfield, VA 3 9.4 130,000
Waltham, MA 4 32.0 418,000
Boston, MA 4 2.5 710,000
-- ----- ---------
29 316.1 6,068,799
-- ----- ---------
-- ----- ---------
</TABLE>
VALUE CREATION PIPELINE - LAND PURCHASE OPTIONS
as of June 30, 1999
<TABLE>
<CAPTION>
NO. OF DEVELOPABLE
LOCATION PARCELS SQUARE FEET
-------- ------- -----------
<S> <C> <C> <C>
Princeton, NJ 15 158.6 1,985,900
Cambridge, MA 1 2.6 209,000
New York, NY 2 1.1 2,300,000
-- ----- ---------
18 162.3 4,494,900
-- ----- ---------
-- ----- ---------
</TABLE>
26
<PAGE>
BOSTON PROPERIES, INC.
SECOND QUARTER 1999
ACQUISITION PROPERTY PROFILE
PROPERTY NAME: 510 Carnegie Center
PRODUCT TYPE: Class A Office Building
LOCATION: Princeton, NJ
DESCRIPTION: A six-story Class A office building located in the Carnegie
Center complex.
SIZE: 234,160 square feet
YEAR CONSTRUCTED: 1998
PURCHASE PRICE: $48.0 million
CLOSING DATE: April 30, 1999
FUTURE INVESTMENT: $-
OCCUPANCY LEVEL: 100%
NUMBER OF TENANTS: 1
FUNDING SOURCE: Cash, Preferred Operating Partnership Units, and Assumption
of Debt
LARGEST TENANT:
COMPANY: Raytheon SIZE: 234,160 sq. ft. LEASE EXPIRATION: 08/31/13
27
<PAGE>
BOSTON PROPERTIES, INC.
800 BOYLSTON STREET, SUITE 400
BOSTON, MA 02199
(NYSE: BXP)
AT THE COMPANY AT THE FINANCIAL RELATIONS BOARD
Elaine M. Quinlan Marianne Stewart - General Info. (212) 661-8030
Director of Investor Relations Claire Koeneman - Analyst (312) 266-7800
617-236-3300 Judith Sylk-Siegel - Media (212) 661-8030
FOR IMMEDIATE RELEASE:
July 27, 1999
BOSTON PROPERTIES, INC. ANNOUNCES
SECOND QUARTER 1999 RESULTS
BOSTON, MA, JULY 27, 1999 - Boston Properties, Inc. (NYSE: BXP) today reported
results for the second quarter ended June 30, 1999.
Funds from Operations (FFO) for the quarter ended June 30, 1999 were
approximately $48.7 million, or $0.74 per share basic and $0.72 per share
diluted, compared to FFO of approximately $38.9 million, or $0.63 per share
basic and diluted, for the quarter ended June 30, 1998. The weighted average
number of basic and diluted shares outstanding totaled 65,533,924 and
79,329,377, respectively, for the quarter ended June 30, 1999 and 61,694,041 and
62,284,095, respectively, for the same quarter last year.
FFO for the six months ended June 30, 1999 were approximately $94.3 million, or
$1.46 per share basic and $1.42 per share diluted, compared to FFO of
approximately $68.3 million, or $1.18 per share basic and $1.16 per share
diluted, for the six months ended June 30, 1998. The weighted average number of
basic and diluted shares outstanding totaled 64,539,307 and 77,562,965,
respectively, for the six months ended June 30, 1999 and 58,009,458,and
58,613,375, respectively, for the same period last year.
Revenues were approximately $191.6 million for the quarter and $379.3 million
for the six months ended June 30, 1999, compared to revenues of approximately
$108.0 million and $203.6 million for the same periods in 1998. Net income
available to common shareholders for the quarter was approximately $27.2 million
and $52.2 million for the six months ended June 30, 1999, compared to $29.9
million and $49.6 million for the same periods in 1998. Income before
extraordinary gain per share for the quarter was $0.42 per share basic and $0.41
per share diluted, compared to $0.42 per share basic and diluted last year.
Income before extraordinary
<PAGE>
Boston Properties, Inc.
Announces 2Q99 Results
Page 2
gain per share for the six months ended June 30, 1999 was $0.81 per share basic
and $0.80 per share diluted, compared to $0.79 per share basic and diluted for
the same period last year.
The reported results are unaudited and there can be no assurance that the
results will not vary from the final information for the quarter ended June 30,
1999. In the opinion of management, all adjustments considered necessary for a
fair presentation of these reported results have been made.
As of June 30, 1999, the Company's portfolio consisted of 127 properties
comprising more than 33.4 million square feet, including eight properties under
development totaling approximately 2.3 million square feet. The overall
occupancy rate for the properties in service as of June 30, 1999 was 97.6%.
Properties under development which were placed in service during the second
quarter include:
- - The Arboretum, a 95,584-square-foot Class A office building located in
Reston, Va., which is currently 100% leased.
- - Eight Cambridge Center, a 177,226-square-foot Class A office building
located in Cambridge, Mass., which is currently 100% leased.
- - 200 West Street, a 248,341-square-foot office building located in Waltham,
Mass., which is currently 95% leased.
Additional highlights of the second quarter include:
- - Acquisition of 510 Carnegie Center, a 234,160-square-foot Class A office
building in Princeton, N. J., for approximately $48.0 million, on April 30,
1999.
- - Issuance of 4,000,000 shares of the Company's Common Stock resulting in net
proceeds of approximately $141.0 million, on May 20, 1999.
- - Acquisition of the remaining 50% interest in the development rights
associated with 111 Huntington Avenue, a parcel of land located at the
Prudential Center in Boston, Mass., which will support an
890,000-square-foot Class A office building, on May 24, 1999. Construction
commenced on April 27, 1999.
Transactions completed since the quarter ended June 30, 1999 include:
- - Closing of mortgage financing secured by Eight Cambridge Center in
Cambridge, Mass., in the amount of $29.0 million at a rate of 7.73%,
maturing in July 2010, on July 7, 1999.
- - Acquisition of 206 Carnegie Center, a 161,763-square-foot Class A office
building in Princeton, N. J., for approximately $27.0 million, on July 9,
1999.
- - Closing of mortgage financing secured by University Place in Cambridge,
Mass., in the amount of $26.0 million at a rate of 6.94%, maturing in
August 2021, on July 26, 1999.
Boston Properties is a fully integrated, self-administered and self-managed real
estate investment trust that develops, redevelops, acquires, manages, operates
and owns a diverse portfolio of office, industrial and hotel properties. The
Company is one of the largest owners and developers
<PAGE>
Boston Properties, Inc.
Announces 2Q99 Results
Page 2
of office properties in the United States, concentrated in the Northeast
Corridor from Virginia to Greater Boston and in downtown San Francisco.
To receive Boston Properties' latest news and corporate developments via fax at
no cost, please call 1-800-PRO-INFO; use Company code BXP. Visit the Company's
web site at http://www.bostonproperties.com.
Also see http://www.frbinc.com.
THIS PRESS RELEASE CONTAINS FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF THE
FEDERAL SECURITIES LAWS. FORWARD-LOOKING STATEMENTS ARE INHERENTLY SUBJECT TO
RISKS AND UNCERTAINTIES, MANY OF WHICH CANNOT BE PREDICTED WITH ACCURACY.
ACQUISITIONS THAT ARE PURSUED BY BOSTON PROPERTIES MAY NOT BE CONSUMMATED FOR A
VARIETY OF REASONS, INCLUDING A FAILURE TO REACH AGREEMENT WITH THE SELLING
PARTY REGARDING THE ACQUISITION PRICE OR OTHER TERMS OF A CONTRIBUTION OR
ACQUISITION AGREEMENT. AGREEMENTS THAT THE COMPANY ENTERS INTO MAY BE TERMINATED
FOR A VARIETY OF REASONS, INCLUDING A FAILURE BY THE COMPANY OR THE OTHER PARTY
TO FULFILL ALL CONDITIONS REQUIRED FOR CONSUMMATION OF THE AGREEMENTS.
Financial tables follow.
###
<PAGE>
BOSTON PROPERTIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited and in thousands, except for per share amounts)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
------------------------- -------------------------
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1999 1998 1999 1998
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Revenue
Rental:
Base rent $ 158,070 $ 87,806 $ 309,679 $ 167,075
Recoveries from tenants 17,252 9,805 34,666 19,362
Parking and other 12,087 1,595 23,011 2,706
--------- --------- --------- ---------
Total rental revenue 187,409 99,206 367,356 189,143
Development and management services 3,611 4,383 7,658 6,159
Interest and other 620 4,452 4,266 8,341
--------- --------- --------- ---------
Total revenue 191,640 108,041 379,280 203,643
--------- --------- --------- ---------
Expenses
Operating 60,306 27,403 117,656 53,933
General and administrative 7,352 5,800 13,962 10,621
Interest 49,219 23,814 99,678 48,743
Depreciation and amortization 29,443 16,594 57,237 29,689
--------- --------- --------- ---------
Total expenses 146,320 73,611 288,533 142,986
--------- --------- --------- ---------
Income before minority interests and joint venture income 45,320 34,430 90,747 60,657
Minority interests in property partnerships (139) (106) (4,294) (229)
Income from unconsolidated joint venture 229 -- 442 --
--------- --------- --------- ---------
Income before minority interest in Operating Partnership 45,410 34,324 86,895 60,428
Minority interest in Operating Partnership (16,505) (7,967) (32,217) (14,440)
--------- --------- --------- ---------
Income before preferred dividend 28,905 26,357 54,678 45,988
Preferred dividend (1,682) -- (2,521) --
--------- --------- --------- ---------
Income before extraordinary gain 27,223 26,357 52,157 45,988
Extraordinary gain, net -- 3,564 -- 3,564
--------- --------- --------- ---------
Net income available to common shareholders $ 27,223 $ 29,921 $ 52,157 $ 49,552
--------- --------- --------- ---------
--------- --------- --------- ---------
Basic earnings per share:
Income before extraordinary gain $ 0.42 $ 0.42 $ 0.81 $ 0.79
Extraordinary gain, net -- 0.06 -- 0.06
--------- --------- --------- ---------
Net income available to common shareholders $ 0.42 $ 0.48 $ 0.81 $ 0.85
--------- --------- --------- ---------
--------- --------- --------- ---------
Weighted average number of common shares outstanding 65,534 61,694 64,539 58,009
--------- --------- --------- ---------
--------- --------- --------- ---------
Diluted earnings per share:
Income before extraordinary gain $ 0.41 $ 0.42 $ 0.80 $ 0.79
Extraordinary gain, net -- 0.06 -- 0.06
--------- --------- --------- ---------
Net income available to common shareholders $ 0.41 $ 0.48 $ 0.80 $ 0.85
--------- --------- --------- ---------
--------- --------- --------- ---------
Weighted average number of common and common
equivalent shares outstanding 66,337 62,284 65,161 58,613
--------- --------- --------- ---------
--------- --------- --------- ---------
</TABLE>
<PAGE>
BOSTON PROPERTIES, INC.
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
1999 1998
----------- -----------
(UNAUDITED)
(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
<S> <C> <C>
ASSETS
Real estate: $ 5,127,469 $ 4,917,193
Less: accumulated depreciation (411,705) (357,384)
----------- -----------
Total real estate 4,715,764 4,559,809
Cash and cash equivalents 32,225 12,166
Notes receivable -- 420,143
Escrows 24,082 19,014
Tenant and other receivables, net 53,059 40,830
Accrued rental income, net 72,535 64,251
Deferred charges, net 50,946 46,029
Prepaid expenses and other assets 28,142 26,058
Investments in joint ventures 42,077 46,787
----------- -----------
Total assets $ 5,018,830 $ 5,235,087
----------- -----------
----------- -----------
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Mortgage notes payable $ 2,799,507 $ 2,653,581
Notes payable -- 420,143
Unsecured line of credit 142,000 15,000
Accounts payable and accrued expenses 61,860 42,897
Dividends payable 45,559 40,494
Accrued interest payable 7,837 7,307
Other liabilities 22,946 27,950
----------- -----------
Total liabilities 3,079,709 3,207,372
----------- -----------
Commitments and contingencies -- --
Minority interests 781,999 1,079,234
Series A Convertible Redeemable Preferred Stock, liquidation preference
$50.00 per share, 2,000,000 shares issued
and outstanding 100,000 --
Stockholders' equity:
Excess stock, $.01 par value, 150,000,000 shares
authorized, none issued or outstanding -- --
Common stock, $.01 par value, 250,000,000 shares
authorized, 67,893,386 and 63,527,819 issued and
outstanding in 1999 and 1998, respectively 678 635
Additional paid-in capital 1,068,016 955,711
Dividends in excess of earnings (11,572) (7,865)
----------- -----------
Total stockholders' equity 1,057,122 948,481
----------- -----------
Total liabilities and stockholders' equity $ 5,018,830 $ 5,235,087
----------- -----------
----------- -----------
</TABLE>
<PAGE>
BOSTON PROPERTIES, INC.
Funds from Operations
(unaudited and in thousands, except for per share amounts)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
----------------------- -----------------------
1999 1998 1999 1998
--------- --------- --------- --------
<S> <C> <C> <C> <C>
Income before minority interests $ 45,320 $ 34,430 $ 90,747 $ 60,657
Add:
Real estate depreciation and amortization 29,238 16,415 56,787 29,359
Income from unconsolidated joint venture 229 -- 442 --
Less:
Minority property partnership's share
of Funds from Operations (128) (138) (3,291) (282)
Preferred dividends and distributions (8,293) -- (15,505) --
--------- --------- --------- --------
Funds from operations $ 66,366 $ 50,707 $ 129,180 $ 89,734
--------- --------- --------- --------
--------- --------- --------- --------
Funds from operations available to common shareholders $ 48,673 $ 38,938 $ 94,343 $ 68,287
--------- --------- --------- --------
--------- --------- --------- --------
Weighted average shares outstanding - basic 65,534 61,694 64,539 58,009
--------- --------- --------- --------
--------- --------- --------- --------
Per share - basic $ 0.74 $ 0.63 $ 1.46 $ 1.18
--------- --------- --------- --------
--------- --------- --------- --------
Weighted average shares outstanding - diluted 79,329 62,284 77,563 58,613
--------- --------- --------- --------
--------- --------- --------- --------
Per share - diluted $ 0.72 $ 0.63 $ 1.42 $ 1.16
--------- --------- --------- --------
--------- --------- --------- --------
</TABLE>
<PAGE>
BOSTON PROPERTIES, INC
PORTFOLIO OCCUPANCY
<TABLE>
<CAPTION>
Occupancy by Location
June 30, 1999 December 31, 1998
-------------- -----------------
<S> <C> <C>
Greater Boston 96.9% 97.0%
Greater Washington, D.C. 96.1% 98.5%
Midtown Manhattan 99.9% 99.9%
Baltimore, MD 100.0% 99.8%
Richmond, VA 96.2% 98.8%
Princeton/East Brunswick, NJ 99.8% 98.7%
Greater San Francisco 98.0% 98.5%
Bucks County, PA 100.0% 100.0%
-------------- -----------------
Total Portfolio 97.6% 98.4%
-------------- -----------------
-------------- -----------------
</TABLE>
<TABLE>
<CAPTION>
Occupancy by Type
June 30, 1999 December 31, 1998
-------------- ------------------
<S> <C> <C>
Class A Office Portfolio 98.0% 98.8%
R&D Portfolio 96.4% 99.2%
Industrial Portfolio 90.4% 89.3%
-------------- ------------------
Total Portfolio 97.6% 98.4%
-------------- ------------------
-------------- ------------------
</TABLE>
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