BXP (BXP) investor relations material

Execution priorities and operational progress

• Leasing activity remains robust, with 3 million sq ft leased in H1 and 950,000 sq ft so far in Q3, driving occupancy toward a 2026 target of 89%.

• Asset sales have reached $1.3 billion closed, with $200 million under contract and $400 million in the market, progressing toward a $1.9 billion goal.

• Development pipeline includes 3.5 million sq ft and $3.2 billion in investment, with notable deliveries like 290 Binney Street (100% leased to AstraZeneca) and strong pre-leasing at 343 Madison.

• Asset sales focus on land and apartments at low cap rates, minimizing dilution compared to office sales.

• Strategic goals include FFO per share growth and leverage reduction, supported by pre-leasing and capital recycling.

Leasing trends and market dynamics

• Active leases under negotiation have grown to 1.8 million sq ft, with significant activity in vacant space and early renewals for 2026–2030.

• Major markets like Midtown Manhattan, Boston, and D.C. are nearly fully leased, with high rents and limited availability.

• San Francisco and Manhattan rents are rising sharply, with some submarkets seeing 30–50% roll-ups on lease renewals.

• Early renewals and long-term lease proposals are increasingly common due to tight supply and tenant urgency.

• Spec suites are widely adopted, especially in San Francisco, reducing downtime and improving leasing economics.

Sector and regional insights

• AI-driven demand is influencing leasing, especially in San Francisco and New York, with spillover effects on other tenants.

• San Francisco is now dominated by tech tenants, with rapid revenue growth among smaller VC-backed firms.

• Seattle is seeing quick leasing to AI companies, while West L.A. remains challenged with little net growth.

• Suburban assets are weaker post-COVID, prompting portfolio shifts toward urban and residential development.