<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):
APRIL 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.)
8 ARLINGTON STREET
BOSTON, MASSACHUSETTS 02116
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code:
(617) 859-2600
<PAGE>
ITEM 5. OTHER EVENTS
Following the issuance of a press release on April 27, 1999, announcing
the Company's results for the first quarter ended March 31, 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 March 31, 1999.
99.2 The Boston Properties, Inc. press release dated April 27, 1999 for the
quarter ended March 31, 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: April 28, 1999 BOSTON PROPERTIES, INC.
/s/David G. Gaw
----------------------------------
By: David G. Gaw
Chief Financial Officer
<PAGE>
EX-99.1
================================================================================
BOSTON PROPERTIES, INC.
Supplementa1 Operating and Financial Data for
the Quarter Ended March 31, 1999
================================================================================
<PAGE>
BOSTON PROPERTIES, INC.
First Quarter 1999
================================================================================
INDEX
Page
----
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
Portfolio Overview 12-13
Occupancy Analysis - same property 14
Page
----
Office Properties 15
R&D Properties 16
Industrial Properties 17
Grand Total - Office, R&D and Industrial Properties 18
Hotel Performance 19
Same Property Performance 20-21
Capital Expenditures 22
Value Creation Pipeline - Acquisitions/Repositioning 23
Value Creation Pipeline - Development 24
Value Creation Pipeline - Land Parcels 25
Acquisition Property Profiles 26-27
================================================================================
1
<PAGE>
BOSTON PROPERTIES, INC.
First Quarter 1999
COMPANY BACKGROUND
Boston Properties Inc., is a self-administered and self-managed real estate
investment trust that develops, acquires, owns, and manages a diverse portfolio
of office, industrial, and hotel properties predominantly located in greater
Boston, greater Washington, DC, midtown Manhattan, greater San Francisco,
Baltimore, Maryland, Richmond, Virginia, and Princeton/East Brunswick, New
Jersey. The Company is one of the largest owners and developers of office
properties in the United States.
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.
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 40
properties adding approximately 14.6 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 $210.6 million. The Company owns or controls land
where it can develop an additional 11.3 million square feet.
Boston Properties is a full-service real estate company with substantial
in-house expertise and resources in acquisitions, development, financing,
construction management, property management, marketing, leasing, accounting,
and legal services.
2
<PAGE>
BOSTON PROPERTIES, INC.
First Quarter 1999
INVESTOR INFORMATION
8 Arlington Street
Boston, MA 02116
(617) 859-2600
(617) 536-5087 (fax)
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
TIMING
Quarterly results will be announced according to the following
anticipated schedule:
Second Quarter Early August
Third Quarter Early November
Year End Early February
3
<PAGE>
BOSTON PROPERTIES, INC.
First 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>
=======================================================================================================================
1st Quarter 1999 1st Quarter 1998
---------------- ----------------
<S> <C> <C>
High Price $ 34.6875 $ 35.8750
Low Price $ 30.3125 $ 32.5000
Closing Price $ 31.6250 $ 35.1875
Dividends per share - annualized $ 1.70 $ 1.62
Closing dividend yield - annualized 5.38% 4.60%
Closing shares, common units and preferred
units (if converted) outstanding (thousands) 100,290 80,123
Closing market value of shares and units outstanding (thousands) $ 3,171,671 $ 2,819,328
=======================================================================================================================
</TABLE>
4
<PAGE>
BOSTON PROPERTIES, INC.
First Quarter 1999
FINANCIAL HIGHLIGHTS
(unaudited and in thousands)
<TABLE>
<CAPTION>
=======================================================================================================
Three Months Ended
-------------------------------------------------
Income Items: March 31, 1999 March 31, 1998 % Change
- ------------- -------------- -------------- --------
<S> <C> <C> <C>
Revenues $ 187,640 $ 95,603 96.27%
Net Income available to common shareholders $ 24,934 $ 19,631 27.01%
Funds from Operations $ 62,814 $ 39,028 60.95%
Company's share (72.75% and 75.20%) $ 45,697 $ 29,349 55.70%
Funds from Operations per share - basic $ 0.72 $ 0.54 33.20%
Funds from Operations per share - diluted $ 0.70 $ 0.53 32.08%
Dividends per share $ 0.425 $ 0.405 4.94%
Ratios:
- -------
Interest Coverage Ratio 2.47 2.60 -4.94%
Dividend Payout Ratio 60.71% 76.42% -20.55%
=======================================================================================================
=======================================================================================================
<CAPTION>
Capitalization: March 31, 1999 December 31, 1998 % Change
- -------------- -------------- ----------------- --------
<S> <C> <C> <C>
Total Debt $ 3,010,755 $ 3,088,724 -2.52%
Total Common Shares Outstanding @ Quarter End 63,540 63,528 0.02%
Total Preferred Shares Outstanding @ Quarter End
(if converted) 2,625 -- --
Total Common Units Outstanding @ Quarter End 23,800 23,798 0.0l%
Total Preferred Units Outstanding @ Quarter End
(if converted) 10,325 10,454 --
Price @ Quarter End 31 5/8 30 1/2 3.69%
Equity Value @ Quarter End $ 3,171,672 $ 2,982,294 6.35%
Total Market Capitalization $ 6,182,427 $ 6,071,018 1.84%
Debt/Total Market Capitalization 48.70% 50.88% -4.28%
=======================================================================================================
</TABLE>
5
<PAGE>
BOSTON PROPERTIES, INC.
First Quarter 1999
CONSOLIDATED BALANCE SHEETS
(unaudited and in thousands)
<TABLE>
<CAPTION>
=====================================================================================================================
March 31, 1999 December 31, 1998
-------------- -----------------
<S> <C> <C>
ASSETS
Real Estate and equipment $ 4,808,576 $ 4,725,757
Land and development in progress 210,373 191,436
Less accumulated depreciation (383,779) (357,384)
----------- -----------
Total real estate and equipment 4,635,170 4,559,809
Cash 33,597 12,166
Escrows 23,365 19,014
Notes receivable -- 420,143
Tenant and other receivables 42,188 40,830
Accrued rental income 68,615 64,251
Deferred charges, net 47,893 46,029
Prepaid expenses and other assets 25,166 26,058
Investment in joint ventures 59,664 46,787
----------- -----------
Total assets $ 4,935,658 $ 5,235,087
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Mortgage notes payable $ 2,758,755 $ 2,653,581
Notes payable -- 420,143
Unsecured line of credit 252,000 15,000
Accounts payable and accrued expenses 51,282 33,638
Dividends payable 43,342 40,494
Accrued interest payable 12,028 7,307
Other liabilities 22,688 37,209
----------- -----------
Total liabilities 3,140,095 3,207,372
----------- -----------
Commitments and contingencies -- --
Minority interests 768,119 1,079,234
Preferred stock, $.01 par value, 50,000,000 shares authorized, 2,000,000 issued
and outstanding 100,000 --
Stockholders' Equity:
Excess stock, $.01 par value, 150,000,000 shares
authorized, none issued or outstanding
Preferred stock, $.01 par value, 50,000,000 shares
authorized, 2,000,000 issued and outstanding
Common stock, $.01 par value, 250,000,000 shares authorized,
63,540,106 and 63,527,819 issued and outstanding, respectively 635 635
Additional paid-in capital 936,745 955,711
Dividend in excess of earnings (9,936) (7,865)
----------- -----------
Total stockholders' equity 927,444 948,481
----------- -----------
Total liabilities and stockholders' equity $ 4,935,658 $ 5,235,087
=========== ===========
=====================================================================================================================
</TABLE>
6
<PAGE>
BOSTON PROPERTIES, INC.
First Quarter 1999
CONSOLIDATED INCOME STATEMENTS
(unaudited and in thousands)
<TABLE>
<CAPTION>
==============================================================================================
Three Months Ended
-----------------------------------
31-Mar-99 31-Mar-98 % Change
--------- --------- ---------
<S> <C> <C> <C>
Revenue:
Rental income $ 179,947 $ 89,938 100.08%
Development and management services 4,047 1,776 127.87%
Interest and other 3,646 3,889 -6.25%
--------- --------- ---------
Total revenue 187,640 95,603 96.27%
Operating Expenses:
Rental expenses 57,350 26,530 116.17%
General and administrative 6,610 4,821 37.11%
Interest 50,459 24,929 102.41%
Depreciation and amortization 27,794 13,095 112.25%
--------- --------- ---------
Total expenses 142,213 69,375 104.99%
--------- --------- ---------
Income before minority interests and before income from
unconsolidated joint venture 45,427 26,228 73.20%
Minority interest in property partnerships (4,155) (123) 3278.05%
Income from unconsolidated joint venture 213 -- --
--------- --------- ---------
Income before minority interest in Operating Partnership 41,485 26,105 58.92%
Minority interest in Operating Partnership (15,712) (6,474) 142.69%
--------- --------- ---------
Net income 25,773 19,631 31.29%
Preferred dividend (839) -- --
--------- --------- ---------
Net income available to common shareholders $ 24,934 $ 19,631 27.01%
========= ========= =========
INCOME PER SHARE OF COMMON STOCK
Net income $ 0.39 $ 0.32 22.65%
========= ========= =========
==============================================================================================
</TABLE>
7
<PAGE>
BOSTON PROPERTIES, INC.
First Quarter 1999
FUNDS FROM OPERATIONS
(in thousands, except for per share amounts)
(unaudited)
<TABLE>
<CAPTION>
======================================================================================================
Three Months Ended
---------------------------------
Actual Actual
31-Mar-99 31-Mar-98 % Change
--------- --------- --------
<S> <C> <C> <C>
Income from operations before minority interests and before income
from unconsolidated joint ventures $ 45,427 $ 26,228 73.20%
Add:
Real estate depreciation and amortization 27,549 12,944 112.83%
Income from unconsolidated joint venture 213 --
Less:
Minority property partnerships share of funds from operations (3,163) (144) 2096.53%
Preferred allocation (7,212) -- --
-------- -------- -------
Funds from Operations $ 62,814 $ 39,028 60.95%
======== ======== =======
Funds from Operations available to common shareholders (1) $ 45,697 $ 29,349 55.70%
======== ======== =======
Funds from Operations per share - basic $ 0.72 $ 0.54 33.20%
======== ======== =======
Weighted average shares outstanding - basic 63,534 54,283 17.04%
======== ======== =======
Funds from Operations per share - diluted $ 0.70 $ 0.53 32.58%
======== ======== =======
Weighted average shares outstanding - diluted 75,862 54,902 38.18%
======== ======== =======
(1) Based on weighted average shares for the quarter. Company's share for the quarter ended 3/31/99
was 72.75% and 75.20% for the quarter ended 3/31/98.
======================================================================================================
</TABLE>
RECONCILIATION TO DILUTED FUNDS FROM OPERATIONS
<TABLE>
<CAPTION>
==============================================================================================================================
For the Three Months Ended March 31, 1999 For the Three Months Ended March 31, 1998
----------------------------------------- -----------------------------------------
Income Shares Per Share Income Shares Per Share
(Numerator) (Denominator) Amount (Numerator) (Denominator) Amount
----------- ------------- ------ ----------- ------------- ------
<S> <C> <C> <C> <C> <C> <C>
Basic Funds from Operations available
to common shareholders $45,697 63,534 $ 0.72 $29,349 54,283 $ 0.54
Minority interest adjustment 2,118 -- -- -- -- --
Effect of Dilutive Securities
Convertile Preferred Units 4,852 10,325 (0.01) -- -- --
Convertible Preferred Stock 639 1,458 -- -- -- --
Stock Options -- 545 (0.01) -- 619 (0.01)
------- ------- ------- ------- ------- -------
Dilutive Funds from Operations (1) $53,306 75,862 $ 0.70 $29,349 54,902 $ 0.53
======= ======= ======= ======= ======= =======
(1) Based on weighted average diluted shares for the quarter. Company's share for the quarter ended 3/31/99 was 76.12% and
75.20% for the quarter ended 3/31/98.
==============================================================================================================================
</TABLE>
8
<PAGE>
BOSTON PROPERTIES, INC.
First Quarter 1999
FINANCIAL RATIOS
<TABLE>
<CAPTION>
========================================================================================================
Three months ended
March 31, 1999
--------------
<S> <C>
RATIOS COMPUTED FOR INDUSTRY COMPARISONS:
OPERATIONAL RATIOS (1,2)
Debt Service Coverage Ratio 2.24
(EBITDA + Income from Unconsolidated Joint Ventures)/(Interest+Principal)
Interest Coverage Ratio 2.47
(EBITDA + Income from Unconsolidated Joint Venture)/Interest
Return on Shareholder's Equity 17.18%
(EBITDA - Interest)/Average Equity (book value) (%)
Return on Real Estate Investments 10.67%
(EBITDA/Average Real Estate Investments (book value)) (%)
FF0 Payout Ratio 60.71%
(Dividends Declared/FFO) (%)
(1) EBITDA is equal to earnings before interest, taxes, depreciation and
amortization.
(2) FF0 is calculated based on the NAREIT White Paper.
========================================================================================================
</TABLE>
9
<PAGE>
BOSTON PROPERTIES, INC.
First Quarter 1999
CAPITAL STRUCTURE
Debt
(in thousands)
================================================================================
Aggregate Principal
March 31, 1999
Mortgage Loans $ 2,758,755
Unsecured Line of Credit 252,000
-----------
Total Debt $ 3,010,755
===========
================================================================================
Equity
(in thousands)
<TABLE>
<CAPTION>
=================================================================================================
Common
Shares & Units Stock $ Value
Outstanding Equivalents Equivalent (1)
<S> <C> <C> <C>
Common Stock 63,540 63,540 $ 2,009,453
Preferred Stock 2,000 2,625 83,016
Operating Partnership Units 23,800 23,800 752,675
Preferred Operating Partnership Units 8,155 10,325 326,528
------- -----------
Total Equity 100,290 $ 3,171,672
======= ===========
Total Market Capitalization $ 6,182,427
===========
=================================================================================================
</TABLE>
(1) Value based on March 31, 1999 closing price of $31 5/8.
10
<PAGE>
BOSTON PROPERTIES, INC.
First Quarter 1999
DEBT ANALYSIS
Long-Term Debt Maturities and Principal Payments
(in thousands)
================================================================================
Year 1999 2000 2001 2002 2003 Thereafter Total
- ---- ---- ---- ---- ---- ---- ---------- -----
Amount 28,748 487,619 148,908 388,440 210,117 1,746,923 $3,010,755
================================================================================
Unsecured Line of Credit - Due June 23, 2000
(in thousands)
================================================================================
Outstanding
Outstanding Letters Remaining
Facility at 3/31/99 of Credit Capacity
-------- ---------- --------- --------
$500,000 252,000 22,500 $225,500
================================================================================
Unsecured and Secured Debt Analysis
================================================================================
Weighted Weighted Average
% of Debt Average Rate Maturity
--------- ------------ --------
Unsecured Debt 8.37% 6.63% 1.2 years
Secured Debt 91.63% 7.00% 5.9 years
------ ---- ---------
Total Debt 100.00% 6.97% 5.5 years
====== ==== =========
================================================================================
Floating and Fixed Rate Debt Analysis
================================================================================
Weighted Weighted Average
% of Debt Average Rate Maturity
--------- ------------ --------
Floating Rate Debt 8.60% 6.60% 0.2 years
Fixed Rate Debt 91.40% 7.01% 6.6 years
------ ---- ---------
Total Debt 100.00% 6.97% 5.5 years
====== ==== =========
================================================================================
11
<PAGE>
BOSTON PROPERTIES, INC.
First 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 4,998,864 545,206 247,318 5,791,388 24.85%
Greater Washington, D.C. 4,987,466 (2) 1,383,442 236,743 6,607,651 28.36%
Greater San Francisco 4,009,536 144,479 281,000 4,435,015 19.03%
Midtown Manhattan 2,874,854 -- -- 2,874,854 12.34%
Princeton/East Brunswick, NJ 1,366,360 -- -- 1,366,360 5.86%
Baltimore, MD 1,166,797 -- -- 1,166,797 5.01%
Richmond, VA 899,720 -- -- 899,720 3.86%
Bucks County, PA -- -- 161,000 161,000 0.69%
---------- --------- ------- ---------- ------
Total 20,303,597 2,073,127 926,061 23,302,785 100.00%
========== ========= ======= ========== ======
% of Total 87.13% 8.90% 3.97% 100.00%
(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.
=========================================================================================================================
</TABLE>
Hotel Properties
================================================================================
Number of Square
Hotel Properties Rooms Feet
- ---------------- ----- ----
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
===== =======
================================================================================
Garage Property and Structured Parking
================================================================================
Number of Square
Spaces Feet
------ ----
Garage Properties
Cambridge Center North Garage 1,170 332,442
Structured Parking 16,572 5,869,641
------ ---------
Total Garage Property and Structured Parking 17,742 6,202,083
====== =========
================================================================================
12
<PAGE>
BOSTON PROPERTIES, INC.
First Quarter 1999
PORTFOLIO OVERVIEW
Percentage of Property Funds from Operations* for In-Service Properties by
Location and Type of Property for Quarter Ended March 31, 1999
<TABLE>
<CAPTION>
===========================================================================================================
Geographic Area Office (1) R&D Industrial Hotel Garage Total
--------------- ---------- --- ---------- ----- ------ -----
<S> <C> <C> <C> <C> <C> <C>
Greater Boston 17.9% 1.1% 0.2% 3.1% 0.3% 22.6%
Greater Washington. D.C. 22.4% 2.9% 0.2% n/a n/a 25.4%
Greater San Francisco 20.1% 0.3% 0.1% n/a n/a 20.4%
Midtown Manhattan 18.6% n/a n/a n/a n/a 18.6%
Baltimore, MD 4.2% n/a n/a n/a n/a 4.2%
Richmond, VA 3.0% n/a n/a n/a n/a 3.0%
Princeton/East Brunswick, NJ 5.6% n/a n/a n/a n/a 5.6%
Bucks County, PA n/a n/a 0.1% n/a n/a 0.1%
---- --- --- --- --- -----
Total 91.9% 4.2% 0.5% 3.1% 0.3% 100.0%
==== === === === === =====
(1) Includes Retail Center FF0 (Prudential Center Boston and Embarcadero
Center).
===========================================================================================================
</TABLE>
* 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.
13
<PAGE>
BOSTON PROPERTIES, INC.
First Quarter 1999
OCCUPANCY ANALYSIS
Same Property Occupancy - By Location
================================================================================
Location 31-Mar-99 31-Mar-98
- -------- --------- ---------
Greater Boston, MA 98.1% 98.1%
Greater Washington, D.C 98.2% 97.7%
Midtown Manhattan, NY 99.9% 97.2%
Baltimore, MD 100.0% 99.7%
Princeton/East Brunswick, NJ n/a n/a
Richmond, VA n/a n/a
Greater San Francisco, CA 95.0% 97.7%
Bucks County, PA 100.0% 100.0%
------ ------
Total Portfolio 98.6% 97.8%
====== ======
================================================================================
Same Property - By Type of Property
================================================================================
31-Mar-99 31-Mar-98
--------- ---------
Total Office Portfolio 99.4% 98.5%
Total R&D Portfolio 99.8% 96.0%
Total Industrial Portfolio 89.3% 95.0%
------ ------
Total Portfolio 98.6% 97.8%
====== ======
================================================================================
14
<PAGE>
BOSTON PROPERTIES, INC.
First Quarter 1999
IN-SERVICE OFFICE PROPERTIES
Lease Expirations
<TABLE>
<CAPTION>
======================================================================================================
Annualized
Rentable Square Revenues Under Percentage of Total
Year of Lease Footage Subject to Expiring Leases Annualized Current Revenues
Expiration Expiring Leases (in thousands) Represented By Expiring Leases
---------- --------------- -------------- ------------------------------
<S> <C> <C> <C>
1999 1,194,745 33,025,197 5.35%
2000 1,538,763 38,592,337 6.25%
2001 2,248,557 69,646,398 11.29%
2002 2,229,123 85,457,363 13.85%
2003 1,813,047 54,155,133 8.78%
2004 1,939,879 57,594,088 9.33%
2005 1,375,602 31,884,543 5.17%
2006 2,353,587 80,800,507 13.09%
2007 1,688,085 60,438,018 9.79%
Thereafter 2,885,478 105,552,262 17.10%
======================================================================================================
</TABLE>
Occupancy By Location
================================================================================
31-Mar-99 31-Mar-98
--------- ---------
Greater Boston, MA 98.5% 98.1%
Greater Washington, D.C. 98.5% 99.9%
Midtown Manhattan, NY 99.9% 97.2%
Baltimore, MD 100.0% 99.7%
Richmond, VA 99.1% 97.4%
Princeton/East Brunswick, NJ 99.5% n/a
Greater San Francisco, CA 96.7% n/a
Bucks County, PA n/a n/a
------ -----
Total Office Portfolio 98.5% 98.5%
====== =====
================================================================================
15
<PAGE>
BOSTON PROPERTIES, INC.
First Quarter 1999
IN-SERVICE R&D PROPERTIES
Lease Expirations
<TABLE>
<CAPTION>
============================================================================================
Annualized
Rentable Square Revenues Under Percentage of Total
Year of Lease Footage Subject to Expiring Leases Annualized Current Revenues
Expiration Expiring Leases (in thousands) Represented By Expiring Leases
---------- --------------- -------------- ------------------------------
<S> <C> <C> <C>
1999 215,967 2,293,317 8.28%
2000 350,238 3,631,373 13.11%
2001 180,901 2,081,579 7.51%
2002 334,510 4,620,591 16.68%
2003 89,317 1,180,220 4.26%
2004 50,533 736,579 2.66%
2005 146,741 1,847,469 6.67%
2006 150,000 1,622,501 5.86%
2007 107,895 2,294,165 8.28%
Thereafter 345,146 7,393,287 26.69%
============================================================================================
</TABLE>
Occupancy By Location
================================================================================
31-Mar-99 31-Mar-98
--------- ---------
Greater Boston, MA 100.0% 100.0%
Greater Washington, D.C. 98.8% 96.0%
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 99.0% 93.1%
Bucks County, PA n/a n/a
------ ------
Total R&D Portfolio 99.1% 96.9%
====== ======
================================================================================
16
<PAGE>
BOSTON PROPERTIES, INC.
First Quarter 1999
IN-SERVICE INDUSTRIAL PROPERTIES
Lease Expirations
<TABLE>
<CAPTION>
===================================================================================================
Annualized
Rentable Square Revenues Under Percentage of Total
Year of Lease Footage Subject to Expiring Leases Annualized Current Revenues
Expiration Expiring Leases (in thousands) Represented By Expiring Leases
---------- --------------- ------------- ------------------------------
<S> <C> <C> <C>
1999 63,904 347,237 6.86%
2000 249,280 1,469,129 29.03%
2001 70,829 357,093 7.06%
2002 -- -- 0.00%
2003 143,105 975,445 19.27%
2004 195,076 935,485 18.48%
2005 20,500 110,151 2.18%
2006 -- -- 0.00%
2007 -- -- 0.00%
Thereafter 83,609 867,015 17.13%
===================================================================================================
</TABLE>
Occupancy By Location
================================================================================
31-Mar-99 31-Mar-98
--------- ---------
Greater Boston, MA 93.0% 93.0%
Greater Washington, D.C. 73.9% 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 89.3% 95.0%
====== ======
================================================================================
17
<PAGE>
BOSTON PROPERTIES, INC.
First Quarter 1999
GRAND TOTAL OF ALL
IN-SERVICE PROPERTIES
Lease Expiration
<TABLE>
<CAPTION>
==================================================================================================
Annualized
Rentable Square Revenues Under Percentage of Total
Year of Lease Footage Subject to Expiring Leases Annualized Current Revenues
Expiration Expiring Leases (in thousands) Represented By Expiring Leases
---------- --------------- ------------- ------------------------------
<S> <C> <C> <C>
1999 1,474,616 35,692,751 5.29%
2000 2,138,281 43,692,839 6.48%
2001 2,500,287 72,085,070 10.68%
2002 2,563,633 90,077,954 13.35%
2003 2,045,469 56,310,798 8.35%
2004 2,185,488 59,266,152 8.78%
2005 1,542,843 33,842,163 5.02%
2006 2,503,587 62,732,183 9.30%
2007 1,795,980 113,812,564 16.87%
Thereafter 3,314,232 107,190,048 15.89%
==================================================================================================
</TABLE>
Occupancy By Location
================================================================================
31-Mar-99 31-Mar-98
--------- ---------
Greater Boston, MA 98.4% 98.0%
Greater Washington, D.C. 97.7% 98.3%
Midtown Manhattan, NY 99.9% 97.2%
Baltimore, MD 100.0% 99.7%
Richmond, VA 99.1% 97.4%
Princeton/East Brunswick, NJ 99.5% n/a
Greater San Francisco, CA 96.5% 97.7%
Bucks County, PA 100.0% 100.0%
------ ------
Total Portfolio 98.2% 98.0%
====== ======
================================================================================
18
<PAGE>
BOSTON PROPERTIES, INC.
First Quarter 1999
HOTEL PERFORMANCE
SAME PROPERTY HOTELS
Long Wharf Marriott - Boston
================================================================================
First Quarter First Quarter Percent
1999 1998 Change
---- ---- ------
Occupancy 85.6% 87.2% -1.83%
Average Daily Rate $ 189.01 $ 175.43 7.74%
REVPAR $ 161.79 $ 152.97 5.77%
================================================================================
Cambridge Center Marriott
================================================================================
First Quarter First Quarter Percent
1999 1998 Change
---- ---- ------
Occupancy 82.8% 77.2% 7.25%
Average Daily Rate $ 158.79 $ 156.55 1.43%
REVPAR $ 131.48 $ 120.86 8.79%
================================================================================
Total Same Property Hotel Performance
================================================================================
First Quarter First Quarter Percent
1999 1998 Change
---- ---- ------
Occupancy 84.2% 82.0% 2.68%
Average Daily Rate $ 173.37 $ 165.66 4.65%
REVPAR $ 146.11 $ 136.36 7.15%
================================================================================
NEWLY PLACED IN SERVICE HOTEL
Residence Inn by Marriott
================================================================================
First Quarter First Quarter Percent
1999 1998 Change
---- ---- ------
Occupancy 67.4% N/A N/A
Average Daily Rate $ 134.18 N/A N/A
REVPAR $ 90.44 N/A N/A
================================================================================
19
<PAGE>
BOSTON PROPERTIES, INC
First 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 8,247,657 1,593,153 926,061 750,400 332,442 11,849,713
Percent of in-service properties 41.2% 76.9% 100.0% 100.0% 100% 51%
Occupancy @ 3/31/98 98.5% 96.0% 95.0% -- -- 97.8%
Occupancy @ 3/31/99 99.4% 99.8% 89.3% -- -- 98.6%
Percent change from 1st quarter 1999
over 1st quarter 1998:
Revenue 4.8% 7.1% -2.2% 15.2% 18.1% 5.4%
Expense 4.2% 0.5% 6.8% 23.4% 52.1% 4.9%
Net Operating Income 5.1% 9.4% -5.0% 13.0% 4.8% 5.6%
===========================================================================================================================
</TABLE>
Same Property Lease Analysis - quarter ended March 31, 1999
<TABLE>
<CAPTION>
====================================================================================================
Office R&D Industrial Total
------ --- ---------- -----
<S> <C> <C> <C> <C>
Vacant space available @ 1/1/99 (sf) 131,617 3,098 98,972 233,687
Square footage of leases expiring or
terminated 1/1/99 - 3/31/99 65,453 7,479 -- 72,932
-------- ------ ------ --------
Total space for lease (sf) 197,070 10,577 98,972 306,619
======== ====== ====== ========
New tenants (sf) 113,237 -- -- 113,237
Renewals (sf) 36,308 7,479 -- 43,787
-------- ------ ------ --------
Total space leased (sf) 149,545 7,479 -- 157,024
======== ====== ====== ========
Space available @ 3/31/99 (sf) 47,525 3,098 98,972 149,595
======== ====== ====== ========
Net increase (decrease) in leased space (sf) 84,092 -- -- 84,092
Average lease term (months) 72 12 N/A 70
2nd generation TI/Comm PSF $ 21.16 $0.00 N/A $ 20.15
Increase in 2nd generation net rents (2) 16.6% 2.7% N/A 15.9%
====================================================================================================
</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.)
20
<PAGE>
BOSTON PROPERTIES, INC.
First Quarter 1999
Same Property Lease Analysis - Year to Date 1/1/98 - 12/31/98
<TABLE>
<CAPTION>
=========================================================================================================
Office R&D Industrial Total
------ --- ---------- -----
<S> <C> <C> <C> <C>
Vacant space available @ 1/1/98 (sf) 54,323 41,654 61,222 157,199
Square footage of leases expiring or
terminated 1/1/98-12/31/98 418,421 73,783 358,358 850,562
-------- -------- -------- ---------
Total space for lease (sf) 472,744 115,437 419,580 1,007,761
======== ======== ======== =========
New tenants (sf) 183,200 72,494 56,000 311,694
Renewals (sf) 162,745 39,354 264,608 466,707
-------- -------- -------- ---------
Total space leased (sf) 345,945 111,848 320,608 778,401
======== ======== ======== =========
Space available @ 12/31/98 (sf) 126,799 3,098 98,972 228,869
======== ======== ======== =========
Net increase/(decrease) in leased space (sf) (72,476) 38,556 (37,750) (71,670)
Average lease term (months) 64 67 29 50
2nd generation TI/Comm PSF $ 13.66 $ 3.32 $ 1.13 $ 7.07
Increase in 2nd generation net rents (1) 17.0% 12.6% -9.2% 9.9%
=========================================================================================================
</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).
21
<PAGE>
BOSTON PROPERTIES, INC.
First Quarter 1999
HISTORICALLY GENERATED CAPITAL EXPENDITURES,
TENANT IMPROVEMENT COSTS AND LEASING COMMISSIONS
Historical Capital Expenditures
<TABLE>
<CAPTION>
============================================================================================================================
1/1-3/31
1993 1994 1995 1996 1997 1998 1999
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Recurring capital expenditures $ 1,425 $ 1,812 $ 1,618 $ 1,083 $ 1,125 $ 3,543 $ 1,496
======== ======== ======== ======== ======== ======== ========
Hotel improvements, equipment upgrades $ 836 $ 1,917 $ 4,420 $ 3,041 $ 2,625 $ 3,872 $ 612
and replacements ======== ======== ======== ======== ======== ======== ========
============================================================================================================================
</TABLE>
2nd Generation Tenant Improvements and Leasing Commissions
<TABLE>
<CAPTION>
==================================================================================================================
1993 1994 1995 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Office
Square feet 451,295 690,459 768,459 970,072
-------- -------- -------- --------
Tenant improvement and lease commissions p.s.f. $ 8.45 $ 9.45 $ 10.66 $ 11.40
-------- -------- -------- --------
R&D
Square feet 166,957 276,332 177,073 337,676
-------- -------- -------- --------
Tenant improvement and lease commissions p.s.f. $ 5.53 $ 0.68 $ 6.99 $ 10.45
-------- -------- -------- --------
Industrial
Square feet 241,500 132,521 308,388 128,148
-------- -------- -------- --------
Tenant improvement and lease commissions p.s.f. $ 0.28 $ 3.32 $ 1.00 $ 1.71
-------- -------- -------- --------
Average tenant improvement and lease commission p.s.f $ 5.59 $ 6.51 $ 7.77 $ 10.31
======== ======== ======== ========
<CAPTION>
1/1-3/31
1997 1998 1999
---- ---- ----
<S> <C> <C> <C>
Office
Square feet 1,016,427 648,291 336,313
---------- -------- --------
Tenant improvement and lease commissions p.s.f. $ 10.83 $ 9.82 $ 15.35
---------- -------- --------
R&D
Square feet 169,878 113,428 13,221
---------- -------- --------
Tenant improvement and lease commissions p.s.f. $ 2.22 $ 3.32 $ 1.94
---------- -------- --------
Industrial
Square feet 258,795 320,608 --
---------- -------- --------
Tenant improvement and lease commissions p.s.f. $ 0.99 $ 1.13 $ --
---------- -------- --------
Average tenant improvement and lease commission p.s.f $ 8.06 $ 6.57 $ 14.85
========== ======== ========
==================================================================================================================
</TABLE>
22
<PAGE>
BOSTON PROPERTIES, INC.
First Quarter 1999
VALUE CREATION PIPELINE - ACQUISITIONS/REPOSITIONING
as of March 31, 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 4,009,536 $1,216,000,000 $ 37,710,000 $1,253,710,000 97%
Sumner Square Mar-99 228,339 32,600,000 3,500,000 36,100,000 67%
--------- -------------- ------------- -------------- ----
Total Value Creation Pipeline - 4,237,875 $1,248,600,000 $ 41,210,000 $1,289,810,000 95%
Acquisitions ========= ============== ============= ============== ====
====================================================================================================================================
</TABLE>
REPOSITIONS PLACED IN SERVICE DURING THE FIRST QUARTER 1999
<TABLE>
<CAPTION>
====================================================================================================================================
Anticipated
Date Placed Initial Future Total Percent
In Service Square Feet Investment Investment Investment Leased
---------- ----------- ---------- ---------- ---------- ------
<S> <C> <C> <C> <C> <C> <C>
Class A Office Building
1301 New York Avenue Q1 1999 177,249 $28,000,000 $18,200,000 $46,200,000 100%
====================================================================================================================================
</TABLE>
23
<PAGE>
BOSTON PROPERTIES, INC.
First Quarter 1999
VALUE CREATION PIPELINE - CONSTRUCTION IN PROGRESS
as of March 31, 1999
<TABLE>
<CAPTION>
==================================================================================================
Estimated Placed # of
Development Properties In Service Date Location Buildings Square feet
- ---------------------- --------------- -------- --------- -----------
<S> <C> <C> <C> <C>
Class A Office Buildings
200 West Street Q2 1999 Waltham, MA 1 248,341
Eight Cambridge Center Q2 1999 Cambridge, MA 1 177,226
One Freedom Square (25% ownership) Q4 1999 Reston, VA 1 406,980
The Arboretum Q3 1999 Reston, VA 1 95,584
181 Spring Street Q2 1999 Lexington, MA 1 53,306
Market Square North (50% ownership) Q4 2000 Washington, DC 1 409,843
502 Carnegie Center Q3 1999 Princeton, NJ 1 114,910
Orbital Sciences Phase I Q2 2000 Loudon, VA 1 92,514
--- ---------
Total Development Properties 8 1,598,704
=== =========
<CAPTION>
Anticipated
Investment Total Percentage
Development Properties to Date Investment Leased
- ---------------------- ------- ---------- ------
<S> <C> <C> <C>
Class A Office Buildings
200 West Street $ 34,324,518 $ 43,423,000 79%
Eight Cambridge Center 21,060,224 26,000,000 100%
One Freedom Square (25% ownership) 10,962,776 19,150,000(1) 73%
The Arboretum 11,194,717 16,223.546 100%
181 Spring Street 9,206,197 12,018,562 0%
Market Square North (50% ownership) 50,505,731 57,500,000(2) 14%
502 Carnegie Center 8,151,699 19,320,318 12%
Orbital Sciences Phase I 13,189 16,916,854 100%
------------ ------------ ----
Total Development Properties $145,419,051 $210,552,280 58%
============ ============ ====
==================================================================================================
</TABLE>
DEVELOPMENTS PLACED IN-SERVICE DURING FIRST QUARTER 1999
<TABLE>
<CAPTION>
============================================================================================================
Estimated Placed # of
In Service Date Location Buildings Square feet
--------------- -------- --------- -----------
<S> <C> <C> <C> <C>
Class A Office Building
One and Two Reston Overlook (25% ownership) Q1-Q2 1998 Reston, VA 2 444,286
Hotels
Residence Inn by Marriott Q1 1999 Cambridge, MA 1 187,474
--- -------
Total 3 631,760
=== =======
<CAPTION>
Investment Total Percentage
to Date Investment Leased
------- ---------- ------
<S> <C> <C> <C>
Class A Office Building'
One and Two Reston Overlook (25% ownership) $16,088,706 $18,100,000(1) 100%
Hotels
Residence Inn by Marriott 23,957,357 32,000,000 n/a
----------- ----------- ---
Total $40,046,063 $50,100,000 100%
=========== =========== ===
============================================================================================================
</TABLE>
(1) Represents 25% of the total anticipated project-level investment.
(2) Represents 50% of the total anticipated project-level investment.
24
<PAGE>
BOSTON PROPERTIES, INC.
First Quarter 1999
VALUE CREATION PIPELINE - OWNED LAND PARCELS
as of March 31, 1999
================================================================================
No. of Developable
Location Parcels Acreage Square Feet
- -------- ------- ------- -----------
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 35.5 450,000
Andover, MA 2 27.0 290,000
Springfield, VA 3 9.4 130,000
Boston, MA -- -- (1) 1,600,000(2)
------ ----- ---------
21 300.1 6,776,000
====== ===== =========
================================================================================
(1) Parcels and acreage have not yet been determined at this time.
(2) Boston Properties has a 50% ownership interest.
VALUE CREATION PIPELINE - LAND PURCHASE OPTIONS
as of March 31, 1999
================================================================================
No. of Developable
Location Parcels Acreage Square Feet
- -------- ------- ------- -----------
Princeton, NJ 15 158.6 1,985,090
Cambridge, MA 1 2.6 209,000
New York, NY 2 1.1 2,300,000
------ ----- ---------
18 162.3 4,494,090
====== ===== =========
================================================================================
25
<PAGE>
BOSTON PROPERTIES, INC.
First Quarter 1999
ACQUISITION PROPERTY PROFILE
PROPERTY NAME: Sumner Square
PRODUCT TYPE: Class A Office Building/Retail
LOCATION: Washington, DC
DESCRIPTION: Located in the heart of the central business
district, Sumner Square is an office complex
comprised of three connected structures,
including a rehabilitated five story brick
school house with a matching annex, a four
story converted brick school, and a nine
story curtain wall structure, which is the
major component of the office complex. The
buildings are linked by a two story marble
and glass skylit atrium. This was the
excluded property as described in the
company's prospectus dated June 18, 1997.
SIZE: 204,136 square feet
YEAR CONSTRUCTED: School rehab and office building completed in
1985.
PURCHASE PRICE: $32.6 million
CLOSING DATE: March 26, 1999
FUTURE INVESTMENT: $3.5 million
OCCUPANCY LEVEL: 67%
NUMBER OF TENANTS: 11
FUNDING SOURCE: Unsecured Line of Credit and Operating
Partnership Units
LARGEST TENANTS:
<TABLE>
<S> <C> <C> <C> <C>
COMPANY: GSA SIZE: 51,283 LEASE EXPIRATION: 08/31/00
COMPANY: Duncan, Weinberg, Miller SIZE: 15,605 LEASE EXPIRATION: 12/01/05
COMPANY: Embassy of Angola SIZE: 12,016 LEASE EXPIRATION: 02/28/01
</TABLE>
26
<PAGE>
BOSTON PROPERTIES, INC.
First Quarter 1999
ACQUISITION PROPERTY PROFILE
PROPERTY NAME: Embarcadero Center
PRODUCT TYPE: Multi-use
LOCATION: San Francisco, California
DESCRIPTION: The largest mixed-use business complex in the
western United States, comprised of 6
multi-tenant Class-A office towers as well as
retail shops, restaurants, entertainment
facilities and parking.
YEAR CONSTRUCTED: Embarcadero Centers 1-4 and West Tower - 1971-1989
The Old Federal Reserve Building - 1924/1988
PURCHASE PRICE: $1.2 Billion
CLOSING DATE: November 12, 1998 (Phase One)
February 10, 1999 (Phase Two)
FUTURE INVESTMENT: $32.7 million
OCCUPANCY LEVEL: 96.7%
NUMBER OF TENANTS: 320
FUNDING SOURCE: Cash, Preferred Operating Partnership Units, Debt
Financing
LARGEST TENANTS:
<TABLE>
<S> <C> <C> <C> <C>
Company: Orrick, Herrington & Sutcliffe Size: 146,013 Lease Expiration: 07/31/2004
Company: Industrial Indemnity Company Size: 103,567 Lease Expiration: 05/31/2004
Company: Peat Marwick, KPMG Size: 98,598 Lease Expiration: 12/31/2009
Company: Dresdner RCM Global Investors Size: 91,040 Lease Expiration: 10/31/2001
</TABLE>
27
<PAGE>
BOSTON PROPERTIES, INC.
8 ARLINGTON STREET
BOSTON, MA 02116
(NYSE: BXP)
AT THE COMPANY AT THE FINANCIAL RELATIONS BOARD
Edward H. Linde Marianne Stewart - General Info. (212) 661-8030
President, CEO, & Director Claire Koeneman - Analyst (312) 266-7800
David G. Gaw Judith Sylk-Siegel - Media (212) 661-8030
SVP & CFO
(617) 859-2600
FOR IMMEDIATE RELEASE:
April 27, 1999
BOSTON PROPERTIES, INC. ANNOUNCES
FIRST QUARTER 1999 RESULTS
BOSTON, MA, APRIL 27, 1999 - Boston Properties, Inc. (NYSE: BXP) today reported
results for the first quarter ended March 31, 1999.
Funds from Operations (FFO) for the quarter ended March 31, 1999 were
approximately $45.7 million, or $0.72 per share basic and $0.70 per share
diluted, compared to FFO of approximately $29.3 million, or $0.54 per share
basic and $0.53 per share diluted for the quarter ended March 31, 1998. The
weighted average number of basic and diluted shares outstanding totaled
63,533,638 and 75,862,001 for the quarter ended March 31, 1999, and 54,282,930
and 54,901,575, respectively, for the same quarter last year.
Revenues were approximately $187.6 million for the quarter, compared to revenue
of $95.6 million for the same period in 1998. Net income available to common
shareholders for the quarter was approximately $24.9 million, compared to $19.6
million for the same period in 1998. Net income per share available to common
shareholders for the quarter was $0.39 per share basic and diluted, compared to
$0.36 per share basic and diluted 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 March 31,
1999. In the opinion of management, all adjustments considered necessary for a
fair presentation of these reported results have been made.
-MORE-
<PAGE>
Boston Properties, Inc.
Announces 1Q99 Results
Page 2
As of March 31, 1999, the Company's portfolio consisted of 124 properties
comprising more than 32.0 million square feet, including eight properties under
development totaling approximately 1.6 million square feet. The overall
occupancy rate for the properties in service as of March 31, 1999 was 98.2%.
Properties under development which were placed in service during the first
quarter include:
- - One and Two Reston Overlook, an approximately 444,000-square-foot Class A
office complex located in Reston, VA. Building I is a 12-story,
323,000-square-foot building built-to-suit TRW, a multinational information
technology company, on January 15, 1999. Building II is a six-story,
133,000-square-foot building that is 100% leased and 65% occupied with the
remaining tenants to take occupancy by June 1, 1999.
The Company has a 25% interest in these properties.
- - The Residence Inn at Cambridge Center Six, an approximately
187,500-square-foot hotel with 221 suites located in Cambridge, MA, on
February 1, 1999. The Residence Inn is managed by Marriott and is targeted
toward extended hotel stays.
- - 1301 New York Avenue, an approximately 178,000-square-foot Class A office
building in Washington, D.C., on February 13, 1999. The property was
acquired on August 14, 1998 and has undergone extensive renovations. The
building is currently 100% leased to the General Services Administration.
Additional highlights of the first quarter include:
- - Signed binding agreement giving the Company the right to acquire, between
now and January 2001, the leasehold interest in the remaining two office
development sites in New York City's Times Square for a total purchase
price of $312.25 million. Affiliates of the Prudential Insurance Company of
America, the sellers, will retain the right to become 33.33% equity
participants in the development ventures by contributing, upon an election
to participate, their proportionate share of the total project equity.
- - Completion of the acquisition of Embarcadero Center, an approximately 4.0
million-square-foot mixed-use urban center located in San Francisco,
California, on February 10, 1999. The total acquisition price was
approximately $1.2 billion.
- - Issuance of 2,000,000 shares of the Company's Series A Convertible
Redeemable Preferred Stock for $100.0 million on February 10, 1999 in
connection with the acquisition of Embarcadero Center.
- - Acquisition of Sumner Square, an approximately 204,000-square-foot
office-complex located in Washington, D.C., on March 26, 1999 for
approximately $32.6 million, from related parties.
-MORE-
<PAGE>
Boston Properties, Inc.
Announces 1Q99 Results
Page 3
Boston Properties, Inc. is a fully integrated, self-administered and
self-managed real estate investment trust ("REIT") that develops, redevelops,
acquires, manages, operates and owns a diverse portfolio of office, industrial,
and hotel properties located predominantly in the Greater Boston; Greater
Washington, D.C.; midtown Manhattan; Greater San Francisco; Baltimore, Maryland;
Princeton/East Brunswick, New Jersey; and Richmond, Virginia markets. The
Company is one of the largest owners and developers of office properties in the
United States.
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.
Announces 1Q99 Results
Page 4
BOSTON PROPERTIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED AND IN THOUSANDS, EXCEPT FOR PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
Three months ended
March 31,
------------------------------------------------
1999 1998
--------------------- ----------------------
<S> <C> <C>
Revenue
Rental:
Base rent $ 151,609 $ 79,270
Recoveries from tenants 17,414 9,557
Parking and other 10,924 1,111
--------------------- ----------------------
Total rental revenue 179,947 89,938
Development and management services 4,047 1,776
Interest and other 3,646 3,889
--------------------- ----------------------
Total revenue 187,640 95,603
--------------------- ----------------------
Expenses
Rental:
Operating 33,576 12,999
Real estate taxes 23,774 13,531
General and administrative 6,610 4,821
Interest 50,459 24,929
Depreciation and amortization 27,794 13,095
--------------------- ----------------------
Total expenses 142,213 69,375
--------------------- ----------------------
Income before minority interests and joint venture income 45,427 26,228
Minority interest in property partnership (4,155) (123)
Income from unconsolidated joint venture 213 -
--------------------- ----------------------
Income before minority interest in Operating Partnership 41,485 26,105
Minority interest in Operating Partnership (15,712) (6,474)
--------------------- ----------------------
Net income 25,773 19,631
Preferred dividend (839) -
--------------------- ----------------------
Net income available to common shareholders $ 24,934 $ 19,631
--------------------- ----------------------
--------------------- ----------------------
Basic earnings per share:
Net income available to common shareholders $ 0.39 $ 0.36
--------------------- ----------------------
--------------------- ----------------------
Weighted average number of common shares outstanding 63,534 54,283
--------------------- ----------------------
--------------------- ----------------------
Diluted earnings per share:
Net income $ 0.39 $ 0.36
--------------------- ----------------------
--------------------- ----------------------
Weighted average number of common and common
equivalent shares outstanding 64,078 54,902
--------------------- ----------------------
--------------------- ----------------------
</TABLE>
<PAGE>
Boston Properties, Inc.
Announces 1Q99 Results
Page 5
BOSTON PROPERTIES, INC.
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
<TABLE>
<CAPTION>
March 31, 1999 December 31, 1998
-------------------------- --------------------------
ASSETS (unaudited)
<S> <C> <C>
Real estate: $ 5,018,949 $ 4,917,193
Less: accumulated depreciation (383,779) (357,384)
-------------------------- --------------------------
Total real estate 4,635,170 4,559,809
Cash and cash equivalents 33,597 12,166
Notes receivable - 420,143
Escrows 23,365 19,014
Tenant and other receivables, net 42,188 40,830
Accrued rental income, net 68,615 64,251
Deferred charges, net 47,893 46,029
Prepaid expenses and other assets 25,166 26,058
Investments in joint ventures 59,664 46,787
-------------------------- --------------------------
Total assets $ 4,935,658 $ 5,235,087
-------------------------- --------------------------
-------------------------- --------------------------
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Mortgage notes payable $ 2,758,755 $ 2,653,581
Notes payable - 420,143
Unsecured line of credit 252,000 15,000
Accounts payable and accrued expenses 51,282 33,638
Dividends payable 43,342 40,494
Accrued interest payable 12,028 7,307
Other liabilities 22,688 37,209
-------------------------- --------------------------
Total liabilities 3,140,095 3,207,372
-------------------------- --------------------------
Commitments and contingencies - -
Minority interests 768,119 1,079,234
Preferred stock, $.01 par value, 50,000,000 shares
authorized, 2,000,000 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, 63,540,106 and 63,527,819 issued and
outstanding, respectively 635 635
Additional paid-in capital 936,745 955,711
Dividends in excess of earnings (9,936) (7,865)
-------------------------- --------------------------
Total stockholders' equity 927,444 948,481
-------------------------- --------------------------
Total liabilities and stockholders' equity $ 4,935,658 $ 5,235,087
-------------------------- --------------------------
-------------------------- --------------------------
</TABLE>
<PAGE>
Boston Properties, Inc.
Announces 1Q99 Results
Page 6
BOSTON PROPERTIES, INC.
FUNDS FROM OPERATIONS
(UNAUDITED AND IN THOUSANDS)
<TABLE>
<CAPTION>
Three months ended
March 31,
--------------------------------------------
1999 1998
-------------------- ----------------------
<S> <C> <C>
Income before minority interests $ 45,427 $ 26,228
Add:
Real estate depreciation and amortization 27,549 12,944
Income from unconsolidated joint venture 213 -
Less:
Minority property partnership's share
of Funds from Operations (3,163) (144)
Preferred dividends and distributions (7,212) -
-------------------- ----------------------
Funds from operations $ 62,814 $ 39,028
-------------------- ----------------------
-------------------- ----------------------
Funds from operations available to common shareholders $ 45,697 $ 29,349
-------------------- ----------------------
-------------------- ----------------------
Weighted average shares outstanding - basic 63,534 54,283
-------------------- ----------------------
-------------------- ----------------------
Per share - basic $ 0.72 $ 0.54
-------------------- ----------------------
-------------------- ----------------------
Weighted average shares outstanding - diluted 75,862 54,902
-------------------- ----------------------
-------------------- ----------------------
Per share - diluted $ 0.70 $ 0.53
-------------------- ----------------------
-------------------- ----------------------
</TABLE>
<PAGE>
Boston Properties, Inc.
Announces 1Q99 Results
Page 7
BOSTON PROPERTIES, INC
PORTFOLIO OCCUPANCY
<TABLE>
<CAPTION>
Occupancy by Location
----------------------------------------------
March 31, 1999 December 31, 1998
------------------- -----------------------
<S> <C> <C>
Greater Boston 98.4% 97.0%
Greater Washington, D.C. 97.7% 98.5%
Midtown Manhattan 99.9% 99.9%
Baltimore, MD 100.0% 99.8%
Richmond, VA 99.1% 98.8%
Princeton/East Brunswick, NJ 99.5% 98.7%
Greater San Francisco 96.5% 98.5%
Bucks County, PA 100.0% 100.0%
------------------- -----------------------
Total Portfolio 98.2% 98.4%
------------------- -----------------------
------------------- -----------------------
</TABLE>
<TABLE>
<CAPTION>
Occupancy by Type
----------------------------------------------
March 31, 1999 December 31, 1998
------------------- -----------------------
<S> <C> <C>
Class A Office Portfolio 98.5% 98.8%
R&D Portfolio 99.1% 99.2%
Industrial Portfolio 89.3% 89.3%
------------------- -----------------------
Total Portfolio 98.2% 98.4%
------------------- -----------------------
------------------- -----------------------
</TABLE>
