BXP, Inc. (BXP) Q1 2025 Earnings Summary

Executive Summary

Q1 2025 delivered steady operations with leasing momentum: 1.1M+ sf executed (+25% y/y) and revenue up 3.1% y/y to $865.2M; diluted EPS was $0.39 and diluted FFO/share was $1.64, in line with management’s forecast .
Guidance was narrowed and midpoint maintained: FY25 FFO/share $6.80–$6.92 and Q2 FFO/share $1.65–$1.67; management highlighted stronger development contributions offset by out-of-service NOI and slightly higher net interest expense .
Occupancy stepped down 60 bps to 86.9% on known expirations (200 Fifth Ave/NY and SF CBD), while leased remained stable at 89.4%, supporting a ramp in 2H as signed leases commence .
Capital markets execution and liquidity: BPLP upsized revolver to $2.25B, extended term loan, increased CP capacity to $750M (at 4.72% as of 4/28), and closed $252M CMBS at 5.491% on Marriott HQ JV .
Potential stock catalysts: sustained Park Ave/Back Bay rent growth, incremental leasing at development assets (360 PAS, Reston), and progress on 343 Madison (8% target yield) and selective monetizations/land sales .

What Went Well and What Went Wrong

What Went Well

Leasing momentum and pipeline: 1.1M+ sf executed in Q1 (25% higher y/y) with notable vacant-space wins (244k sf at 200 Fifth, 162k sf in Waltham); pipeline ~1.1M sf in negotiation and 1.7M sf active .
Development/financing progress: JV formed for 290 Coles (multifamily) with preferred equity and construction loan; $252M CMBS on Marriott HQ JV and upsized corporate credit facilities strengthened liquidity .
Strategic positioning in premier workplaces: Management reiterated segment outperformance with tighter vacancies, stronger rents, and positive absorption vs broader market; Park Ave and Back Bay rent growth remained firm .

What Went Wrong

Occupancy dip and NOI pressure: Total occupancy fell 60 bps to 86.9% on known expirations (NY/SF), with same-property NOI down 0.6% y/y (cash +1.8% helped) .
Life science softness: Slower demand for raw lab space in South San Francisco and Waltham; some life science tenants now seek office-only solutions, delaying lab leasing .
Leverage elevated near term: Net Debt/EBITDAre rose to 8.33x; CFO flagged seasonal G&A effects and an expectation for moderation as developments deliver and cash ramps .

Financial Results

Key Metrics (oldest → newest)

Metric	Q3 2024	Q4 2024	Q1 2025
Revenue ($USD Millions)	$859.2	$858.6	$865.2
Diluted EPS ($)	$0.53	$(1.45)	$0.39
Diluted FFO/Share ($)	$1.81	$1.79	$1.64
Operating Margin (%)(rental)	60.6% (Q1 2025 reference)	61.1% (Q4 2024)	60.6%
Occupancy (%)	87.0%	87.5%	86.9%
Leased (%)	89.1%	89.4%	89.4%
Same-Property NOI YoY (ex term. income)	—	—	(0.6%)
Same-Property NOI Cash YoY (ex term.)	—	—	+1.8%
Net Debt/EBITDAre (Annualized) (x)	—	7.65	8.33
Interest Coverage (x)	—	2.34 (fixed chg cov)	2.83 (ex cap int)

Q1 2025 Composition vs Q1 2024

Revenue Line ($USD Thousands)	Q1 2024	Q1 2025
Lease	$788,590	$811,102
Parking and Other	$32,216	$30,242
Hotel	$8,186	$9,597
Development & Management Services	$6,154	$9,775
Direct Reimbursements	$4,293	$4,499
Total Revenue	$839,439	$865,215

Segment/Market Snapshot (Occupancy by Location, CBD)

Location	Q4 2024 Occupied (%)	Q1 2025 Occupied (%)
Boston	95.9%	96.3%
New York	90.8%	88.1% (known expirations)
San Francisco	84.3%	81.7%
Washington, DC	91.9%	91.9%
Los Angeles	84.9%	83.9%
Seattle	81.6%	81.9%
CBD Total	90.9%	89.8%

KPIs and Capital Structure

KPI	Q4 2024	Q1 2025
FAD ($USD Thousands)	$209,499	$213,885
FAD Payout Ratio (%)	82.48%	81.03%
Consolidated Debt ($USD Millions)	$16,220.5	$15,671.7
Revolver Capacity ($USD Millions)	—	$2,250; $300 drawn
Unsecured CP Outstanding ($USD Millions)	$500	$750 at 4.72% (4/28/25)
CMBS (Marriott HQ JV) ($USD Millions)	—	$252 @ 5.491%

Guidance Changes

Metric	Period	Previous Guidance (Jan 28, 2025)	Current Guidance (Apr 29, 2025)	Change
EPS (GAAP)	Q2 2025	—	$0.38–$0.40	New
FFO/Share (REIT)	Q2 2025	—	$1.65–$1.67	New
EPS (GAAP)	FY 2025	$1.57–$1.75	$1.60–$1.72	Narrowed; midpoint maintained
FFO/Share (REIT)	FY 2025	$6.77–$6.95	$6.80–$6.92	Narrowed; midpoint maintained
Dividend/Share	Q1 2025	—	$0.98 declared (paid Apr 30, 2025)	Maintained

Management noted FY25 changes: +$0.02 same-property contribution, +$0.01 developments, −$0.02 out-of-service NOI, and minor net interest changes (−$0.01), driving narrowed guidance with unchanged midpoint .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q3 2024, Q4 2024)	Current Period (Q1 2025)	Trend
Premier workplaces outperformance	CBD “premier” segment > broader market; rising rent premium	Continued outperformance; tight Park Ave/Back Bay availability and rent growth	Improving
Leasing momentum	Q3: 1.1M sf; Q4: 2.3M sf; FY24: 5.6M sf	Q1: 1.1M+ sf; pipeline 2.8M sf LOIs/proposals	Sustained strength
Tariffs/macro	Rate sensitivity; policy mix could impact yields	Tariffs add volatility; modest construction cost impact so far	Watchful
AI/Tech demand in SF	AI-led absorption noted; amenities upgrades planned	AI remains a positive; smaller users active, positive absorption signs	Stabilizing
Life science demand	Softer raw lab demand; pivot cases to office	Ongoing softness in SSF/Waltham lab; life science office interest persists	Mixed/weak lab
Development pipeline	725 12th preleased; 343 Madison targeted 2025 launch	343 Madison decision by July, targeting ~8% yield; development pre-leasing up to 62%	Advancing
Capital markets & liquidity	$850M 2035 notes; CP program established	Revolver upsized; CP to $750M; opportunistic swaps; CMBS closed	Strengthened

Management Commentary

“Our FFO per share for the quarter was in line with our forecast. We completed over 1.1 million square feet of leasing… 25% above Q1 ‘24” — Owen Thomas .
“Post 4/1/25, our current pool of leases in negotiation is 1.1 million sf… This will drive improvements to occupancy over the next 12–18 months” — Douglas Linde .
“We are narrowing our 2025 FFO guidance range, and maintaining our midpoint with a new range of $6.80 to $6.92 per share” — Michael LaBelle .
“We expect to launch [343 Madison] in 2025… our forecast yield… is 8%” — Executives .
“Our CBD portfolio stayed flat quarter-to-quarter at 89.4% leased… ~1.2M sf leased not yet commenced” — Douglas Linde .

Q&A Highlights

343 Madison: Decision by end of July; target ~8% yield; unusual but real pre-lease interest at 150–300k sf in Park Ave submarket .
Occupancy/FFO cadence: Slight decline in Q2 on expirations, then meaningful ramp in Q3/Q4; implied 2H FFO/share averaging ~1.78 per quarter to reach midpoint .
Leverage: Debt/EBITDAre ticked to ~8.3x on seasonal G&A and development funding; expected to moderate as developments deliver and occupancy improves .
West Coast leasing: Traditional tenants rationalize; AI footprint >5M sf in SF; amenity investments (Mosaic, roof decks, spec suites) to drive traction .
Life science: Demand for lab shell weaker; office-only needs from life science tenants observed; Waltham and SSF leasing focused on office fit-outs .

Estimates Context

Q1 2025 (Consensus vs Actual, S&P Global)	Consensus	Actual	Notes
Revenue ($USD Millions)	$832.76*	$854.92*	Beat by ~$22M (~2.6%)*
Primary EPS ($)	$0.406*	$0.404*	In-line*
FFO/Share (REIT) ($)	$1.649*	$1.64 (company reported)	Essentially in-line; consensus ~1¢ above actual*

Values marked with * retrieved from S&P Global.

Management framed Q1 as “in line” with their forecast, and narrowed FY25 guidance with an unchanged midpoint, suggesting limited estimate drift near term .

Key Takeaways for Investors

Leasing momentum remains robust with vacant-space wins and a growing pipeline; stable leased % (~89.4%) supports 2H occupancy/FFO ramp as commencements hit revenue .
Park Ave (NY) and Back Bay (Boston) exhibit tightening supply and rent growth; exposure there should underpin mark-to-market gains and re-leasing economics .
Watch the cadence: Q2 modestly pressured by Boston expirations, then sequential improvement in Q3/Q4; management affirmed FY25 midpoint with narrowed ranges .
Capital flexibility is improved: upsized revolver, extended term loan, and active CP program provide low-cost liquidity; selective CMBS execution de-risks assets .
Development optionality: 343 Madison (target ~8% yield) and 725 12th (now ~87% pre-leased) offer medium-term growth drivers; pre-leasing progress de-risks .
Risk monitor: SF CBD and lab demand remain softer; occupancy dips from known expirations and out-of-service assets pressure near-term NOI, but signed leases and development deliveries support 2026–2027 trajectory .
Balance sheet: leverage elevated near term (8.33x) but expected to normalize with project cash inflows and occupancy gains; interest coverage healthy at ~2.8x .

Appendix: Additional Data Points

Q1 leasing details: 91 leases, weighted-average term 10.9 years; CBD % occupied 89.8% and % leased 92.3%; total portfolio occupancy 86.9% and % leased 89.4% .
Development pre-leasing rose to 62% as of Apr 25 (from 50% Jan 24) with key wins at 360 Park Ave South, 725 12th (DC), and 1050 Winter Street (Waltham) .
Sustainability: BXP achieved net-zero carbon-neutral operations for Scopes 1 & 2; published its 2024 Sustainability & Impact Report .