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 AT THE COMPANY
Michael WalshSenior Vice President, Finance(617) 236-3410Arista JoynerInvestor Relations Manager(617) 236-3343
BOSTON PROPERTIES ANNOUNCESSECOND QUARTER 2009 RESULTSReports diluted FFO per share of $1.32 Reports diluted EPS of $0.53BOSTON, MA, July 21, 2009
 
– Boston Properties, Inc. (NYSE: BXP)
, a real estate investmenttrust, reported results today for the second quarter ended June 30, 2009.Funds from Operations (FFO) for the quarter ended June 30, 2009 were $166.7 million, or $1.33per share basic and $1.32 per share diluted. This compares to FFO for the quarter ended June 30,2008 of $141.0 million, or $1.18 per share basic and $1.16 per share diluted. FFO for the quarterended June 30, 2009 includes (1) $0.10 per share on a diluted basis related to lease terminationincome, (2) a non-cash impairment charge of $0.05 per share on a diluted basis related to theCompany’s investment in its Value-Added Fund, specifically its Mountain View, CA and SanCarlos, CA properties, and (3) additional non-cash interest expense of $0.06 per share on a dilutedbasis related to the Company’s adoption of FSP No. APB 14-1. FFO for the quarter ended June30, 2008 includes $0.03 per share on a diluted basis related to the additional non-cash interestexpense associated with the Company’s adoption of FSP No. APB 14-1. The weighted averagenumber of basic and diluted shares outstanding totaled 125,266,846 and 127,080,589,respectively, for the quarter ended June 30, 2009 and 119,752,889 and 122,775,797, respectively,for the quarter ended June 30, 2008. The weighted average number of basic and diluted sharesoutstanding for the quarter ended June 30, 2009 includes the impact of the Company’s publicoffering of 17,250,000 shares of common stock on June 10, 2009, as discussed below.In the second quarter ended June 30, 2009, the Company recognized a non-cash impairmentcharge of approximately $7.4 million, or $0.05 per share diluted, representing the other-than-temporary decline in the fair value below the carrying value of the Company’s investment in itsValue-Added Fund, which is an unconsolidated joint venture. In accordance with AccountingPrinciples Board Opinion No. 18 “The Equity Method of Accounting for Investments in CommonStock” (APB No. 18), a loss in value of an investment under the equity method of accounting,which is other than a temporary decline, must be recognized. As a result, the Companyrecognized a non-cash impairment charge on its investment in its Value-Added Fund.
 
800 Boylston StreetBoston, MA 02199
 
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Net income available to common shareholders was $67.2 million for the quarter ended June 30,2009, compared to $75.5 million for the quarter ended June 30, 2008. Net income available tocommon shareholders per share (EPS) for the quarter ended June 30, 2009 was $0.54 basic and$0.53 on a diluted basis. This compares to EPS for the second quarter of 2008 of $0.63 basic and$0.62 on a diluted basis. EPS includes $0.03 and $0.04, on a diluted basis, related to gains onsales of real estate for the quarters ended June 30, 2009 and 2008, respectively.The reported results are unaudited and there can be no assurance that the results will not varyfrom the final information for the quarter ended June 30, 2009. In the opinion of management, alladjustments considered necessary for a fair presentation of these reported results have been made.As of June 30, 2009, the Company’s portfolio consisted of 146 properties comprisingapproximately 49.1 million square feet, including 7 properties under construction totaling 2.3million square feet and one hotel. The overall percentage of leased space for the 138 properties inservice as of June 30, 2009 was 92.0%.Significant events during the second quarter included:
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On April 1, 2009, the Company placed in-service One Preserve Parkway, an approximately184,000 net rentable square foot Class A office property located in Rockville, Maryland.The property is 20% leased.
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On April 21, 2009, the Company obtained construction financing totaling $215.0 millioncollateralized by its Atlantic Wharf development project located at 280 Congress Street inBoston, Massachusetts. Atlantic Wharf, formerly known as Russia Wharf, is a mixed-useproject totaling approximately 815,000 net rentable square feet. Wellington ManagementCompany, LLP has leased approximately 450,000 square feet of the office space in thedevelopment. The construction financing bears interest at a variable rate equal to LIBORplus 3.00% per annum and matures on April 21, 2012 with two, one-year extension options.
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On April 30, 2009, Lehman Brothers, Inc., then the Company’s tenth largest tenant (bysquare feet) with approximately 437,000 net rentable square feet in the Company’s 399 Park Avenue property, rejected its lease in bankruptcy. The Company had previously establisheda reserve for the full amount of the Lehman Brothers, Inc. accrued straight-line rent balancein the third quarter of 2008. Lehman Brothers, Inc. paid rent through the month of April2009 for all of its space and continued to occupy approximately 180,000 net rentable squarefeet through June 22, 2009, for which the Company received an aggregate of approximately$6.5 million in the quarter ended June 30, 2009. In addition, the Company has signed leaseswith tenants for approximately 37,000 net rentable square feet of the vacated space. LehmanBrothers, Inc. had contributed approximately $44.9 million per year on a contractual basis tothe Company’s revenues from this lease.
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On May 31, 2009, a consolidated joint venture in which the Company has a 66.67% interestplaced in-service the Offices at Wisconsin Place, an approximately 299,000 net rentablesquare foot Class A office property located in Chevy Chase, Maryland. The property is91% leased.
 
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On June 1, 2009, General Motors Corporation filed a petition under Chapter 11 of the U.S.Bankruptcy Code with the United States Bankruptcy Court for the Southern District of NewYork. At that time, the Company leased approximately 120,000 square feet of office spaceto General Motors Corporation at 601 Lexington Avenue (formerly known as CitigroupCenter). Rent commencement for the lease at 601 Lexington Avenue began on June 1, 2009and the lease was to expire on May 31, 2019. However, on June 12, 2009, General MotorsCorporation rejected the lease in bankruptcy effective as of June 30, 2009. The contributionfrom this lease, on a contractual basis, from July 1, 2009 through December 31, 2009, wasprojected to be approximately $6.6 million.In addition, the unconsolidated joint venture that owns the General Motors Building (of which the Company owns 60%) currently leases approximately 101,000 square feet of spaceto General Motors Corporation. General Motors Corporation currently occupies the space(other than approximately 7,000 square feet that is subleased to a third party) and the leaseexpires on March 31, 2010.
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On June 9, 2009, the Company used available cash to repay the mortgage loan collateralizedby its Reservoir Place property located in Waltham, Massachusetts totaling approximately$47.8 million. There was no prepayment penalty associated with the repayment. Themortgage loan bore interest at a fixed rate of 7.00% and was scheduled to mature on July 1,2009.
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On June 10, 2009, the Company completed a public offering of 17,250,000 shares of itscommon stock (including 2,250,000 shares issued as a result of the exercise of anoverallotment option by the underwriters) at a price to the public of $50.00 per share. Theproceeds from this public offering, net of underwriters’ discounts and offering costs, totaledapproximately $842.0 million. The Company used a portion of the net proceeds to repay theoutstanding balance of its revolving credit facility totaling $100.0 million and to repay itsmortgage loan totaling approximately $30.1 million collateralized by its Ten CambridgeCenter property, discussed below.
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On June 17, 2009, the Company announced that its Board of Directors declared a regularquarterly cash dividend of $0.50 per share of common stock for the period April 1, 2009 toJune 30, 2009 payable on July 31, 2009 to shareholders of record as of the close of businesson June 30, 2009.
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On June 26, 2009, the Company used available cash to repay the mortgage loancollateralized by its Ten Cambridge Center property located in Cambridge, Massachusettstotaling approximately $30.1 million. The Company paid a prepayment penalty totaling$0.5 million in connection with the repayment. The mortgage loan bore interest at a fixedrate of 8.27% and was scheduled to mature on May 1, 2010.On July 16, 2009, the Board of Directors appointed Alan J. Patricof to the Nominating andCorporate Governance Committee. Mr. Patricof, who will continue to serve as the Chairman of the Company’s Audit Committee, joins Zoë Baird (Chair) and David A. Twardock as members of the Nominating and Corporate Governance Committee.
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