7c6bdc4c0e8236b7ef8ac563e23a7d5cac62a30a5a24b1c65dffe097f9f9b9e7

Gains on sales of real estate dropped to **zero** in Q4 2023 because **Boston Properties, Inc. did not record any property sales** during that period, unlike in Q4 2022 when the company achieved significant gains from selling several properties, including **601 Massachusetts Avenue** and **Virginia 95 Office Park**.  **[0001656423-24-000007_bxp-20231231.htm:186]** **[0001656423-24-000007_bxp-20231231.htm:117]** **[0001656423-24-000007_bxp-20231231.htm:118]** 

Why did Gains on sales of real estate drop to zero in Q4 2023?

The recorded impairment loss in Q1 2024 was the result of a **non-cash impairment charge** related to BXP's investment in **Shady Grove, Maryland**. This impairment charge led to a **$13,615 thousand loss** and induced an impact of **$0.08 per diluted share** of the EPS shortfall compared to the mid-point of the company's guidance.  **[0001656423-24-000024_q12024pressrelease.htm:0]** **[0001656423-24-000024_q12024supplemental.htm:14]** **[0001656423-24-000024_q12024pressrelease.htm:6]** 

What led to the recorded impairment loss in Q1 2024?

The dramatic loss from joint ventures in Q3 2023 was primarily caused by a significant **non-cash impairment charge of $272,603 thousand** on its investments in unconsolidated joint ventures. This impairment loss was partially offset by a **gain of $35,756 thousand** from the restructuring of its interest in the Metropolitan Square investment.  **[0001656423-23-000045_q32023pressrelease.htm:0]** **[0001656423-23-000045_q32023supplemental.htm:11]** **[0001656423-23-000045_q32023supplemental.htm:81]** 

What caused the dramatic loss from joint ventures in Q3 2023?

The significant spike in **Development and Management Services Revenue** in Q4 2023 was driven by several factors. On the **Development** side, higher fees were earned from **unconsolidated joint ventures in the Washington, DC region**, as well as from **tenant improvement projects in a third-party-owned building and a consolidated joint venture in the New York region**. On the **Management** side, the increase was primarily due to **higher property management fees** from a third-party-owned building in the Washington, DC region and an unconsolidated joint venture in New York, along with **increased asset management fees** from an unconsolidated joint venture in Los Angeles and **leasing commission fees** from an unconsolidated joint venture in New York.  **[0001656423-24-000003_q42023pressrelease.htm:8]** **[0001656423-24-000003_q42023supplemental.htm:10]** **[0001656423-24-000007_bxp-20231231.htm:115]** 

What drove the significant spike in Development and management services Revenue in Q4 2023?

Boston Properties' Net Income turned negative in Q3 2023 primarily because the positive impact of non-recurring gains recorded in Q3 2022 was absent in Q3 2023, and the company instead incurred significant non-cash impairment losses. Additionally, **higher interest expenses** and **increased depreciation and amortization** further contributed to the negative result by widening the gap between revenue and expenses.  **[0001656423-23-000045_q32023pressrelease.htm:0]** **[0001656423-23-000047_bxp-20230930.htm:95]** **[0001656423-23-000047_bxp-20230930.htm:129]** **[0001656423-23-000047_bxp-20230930.htm:130]** 

Why did Net Income turn negative in Q3 2023?

3a468e8f2501aee7a1713648038d2d1427e141000b3a180345e7d7bfde552005

The spike in **Right of Use Assets - Finance Leases** in Q4 2023 was primarily due to the **acquisition and consolidation of its partner's 45% interest in the Santa Monica Business Park**. This transaction led to an addition of approximately **$164.1 million** in these assets and included a fair value adjustment of about **$46.1 million** recorded under Other Liabilities.  **[0001656423-24-000003_q42023supplemental.htm:9]** **[0001656423-24-000007_bxp-20231231.htm:221]** 

Why did Right of use assets - finance leases spike in Q4 2023?

The decline in Cash and cash equivalents in Q1 2024 was primarily due to significant cash outflows in financing and investing activities. **Financing activities** led to a net cash outflow of **$756,909 thousand**, largely driven by the payoff of **$700 million of unsecured notes**. Additionally, **investing activities** used **$286,619 thousand** through expenditures on construction in progress, tenant improvements, and building and other capital improvements. Although operating activities provided **$197,595 thousand** in cash, this inflow was not sufficient to offset the combined outflows, resulting in the marked decline in cash balances.  **[0001656423-24-000024_q12024supplemental.htm:9]** **[0001656423-24-000028_bxp-20240331.htm:84]** **[BXP_3382027_8]** 

Why did Cash and cash equivalents decline sharply in Q1 2024?

The increase in **Mortgage notes payable, net** in Q4 2023 was driven by several key factors. **BXP secured a new $600 million mortgage loan** on October 26, 2023, which was collateralized by properties in Cambridge, Massachusetts. Additionally, on December 14, 2023, **BXP acquired its joint venture partner’s 45% interest in the Santa Monica Business Park**, which involved assuming an existing **$300 million mortgage loan**. Refinancing adjustments, particularly through the use of interest rate swaps, also contributed to the significant change in the carrying value of the debt.  **[0001656423-24-000007_bxp-20231231.htm:234]** **[0001656423-24-000007_bxp-20231231.htm:136]** **[0001656423-24-000007_bxp-20231231.htm:141]** 

What drove the increase in Mortgage notes payable in Q4 2023?

The drop in **Unsecured term loans, net** during Q2 2024 is explained by the **repayment of $500,000** on the unsecured term loan during the six months ended June 30, 2024.  **[0001656423-24-000046_bxp-20240630.htm:23]** **[0001656423-24-000046_bxp-20240630.htm:11]** 

What explains the drop in Unsecured term loans in Q2 2024?

The substantial increase in **Right of Use Assets - Operating Leases** by Q4 2023 was primarily due to **BXP's acquisition of its joint venture partner's 45% interest in the Santa Monica Business Park**. This transaction led to the consolidation of the property into BXP's financial statements, along with the recording of approximately **$164.1 million** in additional right-of-use assets (and corresponding lease liabilities), combined with lease-related adjustments that collectively doubled the asset amount by Q4 2023.  **[0001656423-24-000003_q42023supplemental.htm:9]** 

Why did Right of use assets - operating leases double by Q4 2023?

46936c6b66ad5737962505d0524e9f9fbdd6ec2c38d794d5afd034ff303b9788

Total Revenue (USD, thousands)

Lease Revenue (USD, thousands)

Parking and other Revenue (USD, thousands)

Hotel Revenue (USD, thousands)

Development and management services Revenue (USD, thousands)

Direct reimbursements of payroll and related costs from management services contracts Revenue (USD, thousands)

Total Expenses (USD, thousands)

Rental Expenses (USD, thousands)

Hotel Expenses (USD, thousands)

General and administrative Expenses (USD, thousands)

Payroll and related costs from management services contracts Expenses (USD, thousands)

Transaction Costs (USD, thousands)

Depreciation and Amortization Expenses (USD, thousands)

Income (loss) from unconsolidated joint ventures (USD, thousands)

Interest and other income (loss) (USD, thousands)

Gains (losses) from investments in securities (USD, thousands)

Unrealized gain (loss) on non-real estate investment (USD, thousands)

Impairment Loss (USD, thousands)

Interest Expense (USD, thousands)

Net Income (Loss) (USD, thousands)

Net income attributable to noncontrolling interests (USD, thousands)

a3e8a8d0412dd9adb65916bf53b808856ddbde29531cd94d4e66b58fba80e490

886e9be5e94eac6b05f8ce8ab433acd923cb7550e8bb9e953d0f3f327f2bb766

Adjustments for Non-Cash Items [USD, Thousands]

Stock-Based Compensation [USD, Thousands]

Changes in Working Capital [USD, Thousands]

Capital Expenditures (CapEx) [USD, Thousands]

Proceeds from / Repayments of Debt [USD, Thousands]

Share Repurchases [USD, Thousands]

Dividend Payments [USD, Thousands]

Net Change in Cash [USD, Thousands]

423d951cbb476957f9118be42ccac1e0e09f805c1d26046b4564f393206fc9a6

99829b48c7d121985bb432d1efc38c9cf58c00be00e512ac16fd3f741effa257

806d1bb3a627899f851fd90a286a27bace0b2a17158a91056b7a507d71664b17

0ad3e52515f2e394f0d87859f23d28b2f6dbcaa72a6a090ca6acc8e06da29aec

Boston

Los Angeles

New York

San Francisco

Seattle

Washington, DC

Princeton

- Office Revenue

- Residential Revenue

- Hotel Revenue

Total Revenue

e5aac283ed9c427cd1f60ceca8834f39c923fe664d01fa834e44a128d1982188

Lease

- Termination Income

Parking and Other

Hotel

Development and Management Services

Direct Reimbursements

- Base Rent

- Recoveries from Tenants

12e3c3debaf07d8bb0e12fe09aa4c58240cfcdc22fd804f61c9a96da5d1dddb9

BXP (BXP)

Financials