BXP (BXP) investor relations material

Business plan progress and strategic initiatives

• Achieved significant leasing activity, with 1.1 million sq ft leased in Q1 and over 800,000 sq ft already leased in the current quarter, plus a robust pipeline of 2.3 million sq ft under LOI and over 1 million sq ft beyond that.

• Closed $1.2 billion in asset sales, with $200 million under contract and $400 million in marketing, nearing the $1.9 billion three-year target ahead of schedule.

• Advanced development pipeline, including delivery of 290 Binney (AstraZeneca lab) and progress on 343 Madison, now 56% pre-leased.

• Residential development remains active, with new projects near Reston Town Center and ongoing monetization of land in multiple locations.

• Plan to increase occupancy by 4% over two years, targeting 89% in 2026 and 91% in 2027, supporting deleveraging efforts.

Market dynamics and demand trends

• All markets are stronger than a year ago, with demand sources varying by geography: financial and professional services in Manhattan and Boston, life sciences on the urban edge, defense and cybersecurity in Northern Virginia, and AI/tech in San Francisco.

• AI-related leasing is significant, especially in San Francisco, where 80% of Q1 2026 leasing was AI-driven.

• Clients are increasingly seeking premier space, with net absorption driven by both expansion and flight to quality from non-premier assets.

• Notable bifurcation in Washington, D.C., with clients willing to pay premiums for new, high-quality buildings.

Rental rates, occupancy, and tenant behavior

• Rental rate growth observed in Midtown Manhattan (±15% annual), Back Bay Boston (near double-digit), and Northern Virginia (high single-digit).

• Reductions in tenant improvement allowances and free rent are boosting net effective rents beyond headline increases.

• Technology and professional services tenants are expanding, with AI adoption driving headcount and space needs rather than reducing them.

• Example: Kirkland & Ellis is expanding and investing $500 million in AI, seeking more space in Midtown.