SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): JANUARY 17, 2003 BOSTON PROPERTIES, INC. (Exact name of Registrant as specified in its charter) DELAWARE 1-13087 04-2473675 (State or other jurisdiction (Commission File (I.R.S. employer of incorporation) Number) Identification No.) 111 HUNTINGTON AVENUE BOSTON, MASSACHUSETTS 02199 (Address of principal executive offices and zip code) Registrant's telephone number, including area code: (617) 236-3300 ITEM 5. OTHER EVENTS On January 17, 2003, Boston Properties Limited Partnership, the Company's Operating Partnership, closed an offering of $175 million in aggregate principal amount of its 6.25% senior unsecured notes due 2013. The notes were priced at 99.763% of their face amount to yield 6.28%. These notes represent a re-opening of the 6.25% senior notes due 2013 issued by Boston Properties Limited Partnership on December 13, 2002, and these additional notes will constitute a single series of notes with those notes, bringing the aggregate principal amount outstanding of the 6.25% senior notes due 2013 to $925 million. Following the issuance of a press release on January 21, 2003 announcing the Company's results for the fourth quarter ended December 31, 2002, the Company intends to provide, to certain investors and analysts at their request, supplemental information regarding the Company's operations that is to voluminous for a press release. The Company is attaching this supplementary operating and financial data as Exhibit 99.1 and the press release as Exhibit 99.2 to this Current Report on Form 8-K. ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS. (c) Exhibits EXHIBIT NO. 4.1 Supplemental Indenture No. 2, dated as of January 17, 2003, by and between Boston Properties Limited Partnership and The Bank of New York, as Trustee, including a form of the 6.25% Senior Note due 2013. 99.1 Boston Properties, Inc. Supplemental Operating and Financial Data for the quarter ended December 31, 2002. 99.2 The Boston Properties, Inc. press release dated January 21, 2003. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Date: January 23, 2003 BOSTON PROPERTIES, INC. /s/ Douglas T. Linde ------------------------------- By: Douglas T. Linde Chief Financial Officer
Exhibit 4.1 BOSTON PROPERTIES LIMITED PARTNERSHIP to THE BANK OF NEW YORK TRUSTEE ----------------- Supplemental Indenture No. 2 Dated as of January 17, 2003 ----------------- $175,000,000 of 6.25% Senior Notes due 2013 TABLE OF CONTENTS
PAGE ARTICLE ONE RELATION TO SENIOR INDENTURE; DEFINITIONS SECTION 1.1. Relation to Senior Indenture.....................................................2 SECTION 1.2. Definitions......................................................................2 ARTICLE TWO THE NOTES SECTION 2.1. Title of the Securities.........................................................13 SECTION 2.2. Limitation on Aggregate Principal Amount........................................13 SECTION 2.3. Interest and Interest Rates; Maturity Date of Notes.............................13 SECTION 2.4. Limitations on Incurrence of Debt...............................................14 SECTION 2.5. Optional Redemption.............................................................16 SECTION 2.6. Places of Payment...............................................................16 SECTION 2.7. Method of Payment...............................................................16 SECTION 2.8. Currency........................................................................16 SECTION 2.9. Registered Securities; Global Form..............................................17 SECTION 2.10. Form of Notes..................................................................18 SECTION 2.11. Transfer and Exchange..........................................................18 SECTION 2.12. General Provisions Relating to Transfers and Exchanges.........................25 SECTION 2.13. Registrar and Paying Agent.....................................................26 SECTION 2.14. Defeasance.....................................................................26 SECTION 2.15. Provision of Financial Information.............................................27 SECTION 2.16. Waiver of Certain Covenants....................................................27 SECTION 2.17. No Sinking Fund................................................................27 SECTION 2.18. No Repayment at Option of Holders..............................................28 SECTION 2.19. Designation of CBD Properties..................................................28 ARTICLE THREE MISCELLANEOUS PROVISIONS SECTION 3.1. Ratification of Senior Indenture................................................28 SECTION 3.2. Governing Law...................................................................28 SECTION 3.3. Counterparts....................................................................28 SECTION 3.4. Trustee.........................................................................28 SCHEDULE A - SC-A-1 SCHEDULE B - SC-B-1 EXHIBIT A - A-1 EXHIBIT B - B-1 EXHIBIT C - C-1 THIS SUPPLEMENTAL INDENTURE NO. 2, dated as of January 17, 2003 (the "Second Supplemental Indenture"), between BOSTON PROPERTIES LIMITED PARTNERSHIP, a limited partnership organized under the laws of the State of Delaware (herein called the "Company"), and THE BANK OF NEW YORK, a New York banking corporation, as trustee (herein called the "Trustee"). RECITALS OF THE COMPANY The Company has heretofore delivered to the Trustee an Indenture dated as of December 13, 2002 (the "Senior Indenture"), providing for the issuance by the Company from time to time of its senior debt securities evidencing its unsecured and unsubordinated indebtedness (the "Securities"). Section 3.01 of the Senior Indenture provides for various matters with respect to any series of Securities issued under the Senior Indenture to be established in an indenture supplemental to the Senior Indenture. Section 9.01(7) of the Senior Indenture provides for the Company and the Trustee to enter into an indenture supplemental to the Senior Indenture to establish the form or terms of Securities of any series as provided by Sections 2.01 and 3.01 of the Senior Indenture. Pursuant to the terms of the Senior Indenture, the Company issued $750,000,000 aggregate principal amount of its 6.25% Senior Notes due 2013 under a supplemental indenture dated as of December 13, 2002 (the "First Supplemental Indenture") between the Company and the Trustee. In accordance with Section 2.2 of the First Supplemental Indenture, the Company desires to provide for the issue of an additional $175,000,000 aggregate principal amount of its 6.25% Senior Notes due 2013, such that the additional notes and the notes issued under the First Supplemental Indenture shall form a single series of notes to be known as the Company's 6.25% Senior Notes due 2013 (the "Notes"), the form and substance of such Notes and the terms, provisions and conditions thereof to be set forth as provided in the Senior Indenture and this Second Supplemental Indenture. The Board of Directors of Boston Properties, Inc., the general partner of the Company, has duly adopted resolutions authorizing the Company to execute and deliver this Second Supplemental Indenture. All of the conditions and requirements necessary to make this Second Supplemental Indenture, when duly executed and delivered, a valid and binding agreement in accordance with its terms and for the purposes herein expressed, have been performed and fulfilled. NOW, THEREFORE, THIS SECOND SUPPLEMENTAL INDENTURE WITNESSETH: For and in consideration of the premises and the purchase of the series of Securities provided for herein by the Holders thereof, it is mutually covenanted and agreed, for the equal and proportionate benefit of all Holders of Securities of such series, as follows: ARTICLE ONE RELATION TO SENIOR INDENTURE; DEFINITIONS SECTION 1.1. RELATION TO SENIOR INDENTURE. This Second Supplemental Indenture constitutes an integral part of the Senior Indenture. SECTION 1.2. DEFINITIONS. For all purposes of this Second Supplemental Indenture, except as otherwise expressly provided for or unless the context otherwise requires: (1) Capitalized terms used but not defined herein shall have the respective meanings assigned to them in the Senior Indenture; and (2) All references herein to Articles and Sections, unless otherwise specified, refer to the corresponding Articles and Sections of this Second Supplemental Indenture. "ADDITIONAL INTEREST" has the meaning specified in Section 2.3(d) hereof. "ANNUALIZED CONSOLIDATED EBITDA" means, for any quarter, the product of Consolidated EBITDA for such period of time multiplied by four (4), PROVIDED that any non-recurring item that is an expense shall be added back to net income in determining such Consolidated EBITDA before such multiplication and deducted once from such product, and FURTHER PROVIDED that any non-recurring item that is income shall be added to such product once and shall not be multiplied by four. "ANNUALIZED INTEREST EXPENSE" means, for any quarter, the Interest Expense for that quarter multiplied by four (4). "ANOTHER PERSON'S SHARE" means, in connection with the defined term "Contingent Liabilities of Boston Properties Limited Partnership and Subsidiaries", (1) the aggregate direct and indirect interests of each Person other than the Company or any of its Subsidiaries in the equity capital of the applicable Partially-Owned Entity, calculated by subtracting from 100% the Percentage Interest with respect to such Partially-Owned Entity, or (2) in the case of reimbursement owed to the Company or any of its Subsidiaries by a third party in respect of payment made under a guaranty, the amount to be reimbursed to the Company or any of its Subsidiaries by such third party. 2 "APPLICABLE PROCEDURES" means, with respect to any transfer or exchange of or for beneficial interests in any Global Note, the rules and procedures of the Depositary, Euroclear or Clearstream, as the case may be, that apply to such transfer or exchange. "CAPITALIZATION RATE" means: (i) 9.0% for properties other than the CBD Properties, and (ii) 8.5% for properties which are CBD Properties. "CAPITALIZED PROPERTY VALUE" means, as of any date, the sum of (1) with respect to CBD Properties and non-CBD Properties, in each case that are not hotel properties, the aggregate sum of all Property EBITDA for each such CBD Property and non-CBD Property for the Latest Completed Quarter prior to such date, annualized (i.e., multiplied by four (4)), and capitalized at the applicable Capitalization Rate PLUS (2) with respect to CBD Properties and non-CBD Properties, in each case that are hotel properties, the aggregate sum of all Property EBITDA for each such CBD Property and non-CBD Property for the most recent four (4) consecutive completed fiscal quarters, capitalized at the applicable Capitalization Rate; PROVIDED, HOWEVER, that if the value of a particular property calculated pursuant to clause (1) or (2) above, as applicable, is less than the undepreciated book value of such property, as determined in accordance with GAAP, such undepreciated book value shall be used in lieu thereof with respect to such property. "CBD PROPERTIES" means each of the properties set forth on SCHEDULE A attached hereto, together with each additional property which is, from time to time, designated by the Company as a CBD Property in accordance with Section 2.19 hereof. "CBD MARKETS" means each of the markets set forth on SCHEDULE B attached hereto. "CLOSING DATE" has the meaning assigned to such term in the Registration Rights Agreement. "COMPARABLE TREASURY ISSUE" means the United States Treasury security selected by an Independent Investment Banker as having a maturity comparable to the remaining term of the Notes that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of such Notes. "COMPARABLE TREASURY PRICE" means, with respect to any Redemption Date, (a) the bid price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) at 4:00 P.M. on the third business day preceding such Redemption Date, as set forth on "Telerate Page 500" (or such other page as may replace Telerate Page 500), or (b) if such page (or any successor page) is not displayed or does not contain such bid prices at such time (i) the average of the Reference Treasury Dealer Quotations obtained by the Trustee for such Redemption Date, after excluding the highest and lowest of four such Reference Treasury Dealer Quotations, or (ii) if the Trustee is unable to obtain at least four such Reference Treasury Dealers Quotations, the average of all Reference Treasury Dealer Quotations obtained by the Trustee. 3 "CONSOLIDATED EBITDA" means, for any period of time, without duplication (1) net income (loss), excluding net derivative gains and gains (losses) on dispositions of real estate, before deductions for (i) Interest Expense, (ii) taxes, (iii) depreciation, amortization, net derivative losses and all other non-cash items, as determined in good faith by the Company, deducted in arriving at net income (loss), (iv) extraordinary items, (v) non-recurring items, as determined in good faith by the Company (including prepayment penalties), and (vi) minority interest, of the Company and its Subsidiaries; PLUS (2) the product of (A) net income (loss), excluding net derivative gains and gains (losses) on dispositions of real estate, before deductions for (i) interest expense, (ii) taxes, (iii) depreciation, amortization, net derivative losses and all other non-cash items, as determined in good faith by the Company, deducted in arriving at net income (loss), (iv) extraordinary items, and (v) non-recurring items, as determined in good faith by the Company (including prepayment penalties), of Partially-Owned Entities, multiplied by (B) the Company's and its Subsidiaries' percentage share of such Partially-Owned Entities; MINUS (3) the Company's income (loss) from Partially-Owned Entities. In each of cases (1), (2) and (3) for such period, amounts shall be as reasonably determined by the Company in accordance with GAAP, except to the extent GAAP is not applicable with respect to the determination of all non-cash and non-recurring items. Consolidated EBITDA shall be adjusted, without duplication, to give pro forma effect: (x) in the case of any assets having been placed-in-service or removed from service since the beginning of the period and on or prior to the date of determination, to include or exclude, as the case may be, any Consolidated EBITDA earned or eliminated as a result of the placement of such assets in service or removal of such assets from service as if the placement of such assets in service or removal of such assets from service occurred at the beginning of the period; and (y) in the case of any acquisition or disposition of any asset or group of assets since the beginning of the period and on or prior to the date of determination, including, without limitation, by merger, or stock or asset purchase or sale, to include or exclude, as the case may be, any Consolidated EBITDA earned or eliminated as a result of the acquisition or disposition of those assets as if the acquisition or disposition occurred at the beginning of the period. "CONSOLIDATED FINANCIAL STATEMENTS" means, with respect to any Person, collectively, the consolidated financial statements and notes to those financial statements, of that Person and its subsidiaries prepared in accordance with GAAP. For purposes of this definition, if as of any date or for any period actual consolidated financial statements of any Person have not been prepared, then this term shall include the books and records of that Person ordinarily used in the preparation of such financial statements. "CONTINGENT LIABILITIES OF BOSTON PROPERTIES LIMITED PARTNERSHIP AND SUBSIDIARIES" means, as of any date, without duplication, those liabilities of the Company or any of its Subsidiaries consisting of indebtedness for borrowed money, as determined in accordance with GAAP, that are or would be stated and quantified as contingent liabilities in the notes to the Consolidated Financial Statements of the Company as of that date; PROVIDED, HOWEVER, that Contingent Liabilities of Boston Properties Limited Partnership and Subsidiaries shall exclude Another Person's Share of Duplicated Obligations. 4 "DEBT" means, as of any date, without duplication, (1) in the case of the Company, all indebtedness and liabilities for borrowed money, secured or unsecured, of the Company, including the Notes to the extent outstanding from time to time; (2) in the case of the Company's Subsidiaries, all indebtedness and liabilities for borrowed money, secured or unsecured, of the Subsidiaries, including in each of cases (1) and (2) mortgage and other notes payable, but excluding in each of cases (1) and (2) any indebtedness, including mortgages and other notes payable, which is secured by cash, cash equivalents or marketable securities or defeased (it being understood that cash collateral shall be deemed to include cash deposited with a trustee with respect to third party indebtedness; PROVIDED that such trustee holds such cash for not more than 60 days from the date of deposit); and (3) all Contingent Liabilities of Boston Properties Limited Partnership and Subsidiaries. It is understood that Debt shall not include any redeemable equity interest in the Company. "DEFAULTED INTEREST" has the meaning specified in Section 2.3 hereof. "DEFINITIVE NOTE" means a certificated Note in the form of EXHIBIT A hereto, registered in the name of the Holder thereof and issued in accordance with Section 2.11 hereof, except that such Note shall not bear the Global Note Legend. "DEPOSITARY" has the meaning assigned to it in Section 2.9(a) hereof. "DUPLICATED OBLIGATIONS" means, as of any date, collectively, all those payment guaranties in respect of indebtedness and other liabilities, secured or unsecured, of Partially-Owned Entities, including mortgage and other notes payable, for which (1) the Company or any of its Subsidiaries, on the one hand, and another Person or Persons, on the other hand, are jointly and severally liable or (2) the Company or any of its Subsidiaries are entitled to reimbursement in respect of payment under such guaranties from another Person or Persons. "EXCHANGE NOTES" means the debt securities of the Company to be offered to Holders in exchange for Initial Notes pursuant to the Exchange Offer or otherwise pursuant to a registration of debt securities containing terms identical in all material respects to the Notes for which they are exchanged. "EXCHANGE OFFER" means the exchange offer by the Company of Exchange Notes for Initial Notes pursuant to the Registration Rights Agreement. "EXCHANGE OFFER REGISTRATION STATEMENT" has the meaning assigned to such term in the Registration Rights Agreement. "GAAP" means generally accepted accounting principles in the United States, consistently applied, as in effect from time to time. "GLOBAL NOTES" means, individually or collectively, any of the Notes issued as Global Securities under the Senior Indenture. 5 "GLOBAL NOTE LEGEND" means the legend set forth in Section 2.03 of the Senior Indenture, which is required to be placed on all Global Notes issued under the Senior Indenture. "HOLDERS" has the meaning specified in Section 2.3 hereof. "INCUR" means, with respect to any Debt or other obligation of any Person, to create, assume, guarantee or otherwise become liable in respect of the Debt or other obligation, and "Incurrence" and "Incurred" have the meanings correlative to the foregoing. "INDEPENDENT INVESTMENT BANKER" means J.P. Morgan Securities Inc., Banc of America Securities LLC, Salomon Smith Barney Inc. or such other independent investment banking institution of national standing appointed by the Company. "INDIRECT PARTICIPANT" means a Person who holds a beneficial interest in a Global Note through a Participant. "INITIAL NOTES" means the Notes issued under this Second Supplemental Indenture which are not Exchange Notes. "INITIAL PURCHASERS" has the meaning assigned to such term in the Registration Rights Agreement. "INTERCOMPANY DEBT" means, as of any date, Debt to which the only parties are Boston Properties, the Company, any Subsidiary of either of them as of that date or any Partially-Owned Entity. "INTEREST EXPENSE" means, for any period of time, the aggregate amount of interest recorded in accordance with GAAP for such period of time by the Company and its Subsidiaries, but EXCLUDING: (i) interest reserves funded from the proceeds of any loan and (ii) amortization of deferred financing costs; and INCLUDING, without duplication: (A) effective interest in respect of original issue discount as determined in accordance with GAAP; and (B) without limitation or duplication, the interest expense (determined as provided above) of Partially-Owned Entities, multiplied by the Company's Percentage Interest of the Partially-Owned Entity Outstanding Debt in such Partially-Owned Entities, in all cases as reflected in the applicable Consolidated Financial Statements. "INTEREST PAYMENT DATE" has the meaning specified in Section 2.3 hereof. "LATEST COMPLETED QUARTER" means the most recently ended fiscal quarter of the Company for which Consolidated Financial Statements of the Company have been completed, it being understood that at any time when the Company is subject to the informational requirements of the Exchange Act, and in accordance therewith files annual and quarterly reports with the Commission, the term "Latest Completed Quarter" shall be deemed to refer to the fiscal quarter covered by the Company's most recently filed Quarterly Report on Form 10-Q, or, in the case of the last fiscal quarter of the year, the Company's Annual Report on Form 10-K. 6 "LETTER OF TRANSMITTAL" means the letter of transmittal to be prepared by the Company and sent to all Holders of the Notes for use by such Holders in connection with the Exchange Offer. "LIEN" means, without duplication, any lien, mortgage, trust deed, deed of trust, deed to secure debt, pledge, security interest, assignment for collateral purposes, deposit arrangement, or other security agreement, excluding any right of setoff but including, without limitation, any conditional sale or other title retention agreement, any financing lease having substantially the same economic effect as any of the foregoing, and any other like agreement granting or conveying a security interest; PROVIDED, that for purposes hereof, "Lien" shall not include any mortgage that has been defeased by the Company, any of its Subsidiaries or any of the Partially-Owned Entities in accordance with the provisions thereof through the deposit of cash, cash equivalents or marketable securities (it being understood that cash collateral shall be deemed to include cash deposited with a trustee with respect to third party indebtedness). "NON-U.S. PERSON" means a Person who is not a U.S. Person. "NOTES" has the meaning specified in Section 2.1 hereof. For all purposes of this Second Supplemental Indenture, the term "Notes" shall include the Initial Notes and any Exchange Notes to be issued and exchanged for any Initial Notes pursuant to the Registration Rights Agreement and this Second Supplemental Indenture and, for purposes of this Second Supplemental Indenture, all Initial Notes and Exchange Notes shall vote together as one series of Notes under the Senior Indenture. "PARTIALLY-OWNED ENTITY" means, at any time, any of the partnerships, associations, corporations, limited liability companies, trusts, joint ventures or other business entities in which the Company, directly, or indirectly through full or partial ownership of another entity, owns an equity interest, but which is not required in accordance with GAAP to be consolidated with the Company for financial reporting purposes. "PARTIALLY-OWNED ENTITY OUTSTANDING DEBT" means, as of any date, the aggregate principal amount of all outstanding indebtedness and liabilities for borrowed money, secured or unsecured, of the applicable Partially-Owned Entity, including mortgage and other notes payable but excluding any indebtedness which is secured by cash, cash equivalents or marketable securities or defeased (it being understood that cash collateral shall be deemed to include cash deposited with a trustee with respect to third party indebtedness), all as reflected in the Consolidated Financial Statements of such Partially-Owned Entity as of such date. "PARTICIPANT" means, with respect to Euroclear, Clearstream or the Depositary, a Person who has an account with Euroclear, Clearstream or the Depositary, as the case may be (and, with respect to The Depository Trust Company, shall include Euroclear and Clearstream). 7 "PARTICIPATING BROKER-DEALER" has the meaning assigned to such term in the Registration Rights Agreement. "PERCENTAGE INTEREST" means, with respect to a Partially-Owned Entity, the Company's direct or indirect interest in the equity capital of such entity without giving effect to any incentive or performance-based sharing in the entity's cash flow from operations or proceeds from capital transactions in excess of such equity interest. "PROPERTY EBITDA" means for any property, CBD Property or non-CBD Property, for any period of time, without duplication, (1) if the property is owned by the Company or any of its Subsidiaries, the net income (loss) derived from such property, excluding net derivative gains and gains (losses) on dispositions of real estate, before deductions for (i) Interest Expense, (ii) taxes, (iii) depreciation, amortization, net derivative losses and all other non-cash items, as determined in good faith by the Company, deducted in arriving at net income (loss), (iv) extraordinary items, (v) non-recurring items, as determined in good faith by the Company (including prepayment penalties), and (vi) minority interest, and (2) if the property is owned by a Partially-Owned Entity, the product of (A) net income (loss) derived from such property, excluding net derivative gains and gains (losses) on dispositions of real estate, before deductions for (i) interest expense, (ii) taxes, (iii) depreciation, amortization, net derivative losses and all other non-cash items, as determined in good faith by the Company, deducted in arriving at net income (loss), (iv) extraordinary items, and (v) non-recurring items, as determined in good faith by the Company (including prepayment penalties), multiplied by (B) the Company's and its Subsidiaries' percentage share of such Partially-Owned Entity. In each of cases (1) and (2) for such period, amounts shall be as reasonably determined by the Company in accordance with GAAP, except to the extent GAAP is not applicable with respect to the determination of all non-cash and non-recurring items. Property EBITDA shall be adjusted, without duplication, to give pro forma effect: (x) in the case of any assets having been placed-in-service or removed from service since the beginning of the period and on or prior to the date of determination, to include or exclude, as the case may be, any Property EBITDA earned or eliminated as a result of the placement of such assets in service or removal of such assets from service as if the placement of such assets in service or removal of such assets from service occurred at the beginning of the period; and (y) in the case of any acquisition or disposition of any asset or group of assets since the beginning of the period and on or prior to the date of determination, including, without limitation, by merger, or stock or asset purchase or sale, to include or exclude, as the case may be, any Property EBITDA earned or eliminated as a result of the acquisition or disposition of those assets as if the acquisition or disposition occurred at the beginning of the period. For purposes of this definition, in the case of (1) and (2) above, Property EBITDA shall exclude general and administrative expenses as reflected in the Company's audited year-end Consolidated Financial Statements or reviewed interim Consolidated Financial Statements available for the Latest Completed Quarter or the most recent four (4) consecutive completed fiscal quarters, as applicable. "QIB" means a "qualified institutional buyer" as defined in Rule 144A. 8 "QUALIFIED PERSON" means a "qualified person" within the meaning of Code Section 49(a)(1)(D)(iv). "REFERENCE TREASURY DEALER" means J.P. Morgan Securities Inc., Banc of America Securities LLC and Salomon Smith Barney Inc.(and their respective successors) or such other primary U.S. Government securities dealer appointed by the Company and three other primary U.S. Government securities dealers in New York City selected by the Independent Investment Banker (each, a "Primary Treasury Dealer"); PROVIDED, HOWEVER, that if any of the foregoing shall cease to be a Primary Treasury Dealer, the Company shall substitute therefor another Primary Treasury Dealer. "REFERENCE TREASURY DEALER QUOTATIONS" means, with respect to each Reference Treasury Dealer and any Redemption Date for the Notes, an average, as determined by the Trustee, of the bid and asked prices for the Comparable Treasury Issue for the Notes (expressed in each case as a percentage of its principal amount) quoted in writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third business day preceding such Redemption Date. "REGISTRABLE SECURITIES" has the meaning assigned to such term in the Registration Rights Agreement. "REGISTRATION RIGHTS AGREEMENT" means the Registration Rights Agreement, dated as of January 13, 2003, among the Company and the Initial Purchasers. "REGULAR RECORD DATE" has the meaning specified in Section 2.3 hereof. "REGULATION S GLOBAL NOTE" means a Global Note in the form of EXHIBIT A hereto bearing the Global Note Legend and the legend in Section 2.11(f)(i) hereof and deposited with or on behalf of the Depositary and registered in the name of the Depositary or its nominee. "RESTRICTED DEFINITIVE NOTE" means a Definitive Note bearing the Restricted Legend. "RESTRICTED LEGEND" means the legend initially set forth on the Initial Notes in the form set forth in Section 2.11(f)(ii). "RESTRICTED PERIOD" means the period beginning on the date hereof and ending on the later of January 22, 2003 and the completion of the distribution of the Notes by the Initial Purchasers. "RULE 144" means Rule 144 promulgated under the Securities Act, any successor rule or regulation to substantially the same effect or any additional rule or regulation under the Securities Act that permits transfers of restricted securities without registration such that the transferee thereof holds securities that are freely tradeable under the Securities Act. 9 "RULE 144A" means Rule 144A promulgated under the Securities Act or any successor rule or regulation to substantially the same effect. "RULE 144A GLOBAL NOTE" means a Global Note in the form of EXHIBIT A hereto bearing the Global Note Legend and the Restricted Legend and deposited with or on behalf of, and registered in the name of, the Depositary or its nominee. "RULE 903" means Rule 903 promulgated under the Securities Act or any successor rule or regulation substantially to the same effect. "RULE 904" means Rule 904 promulgated under the Securities Act or any successor rule or regulation substantially to the same effect. "SECURED DEBT" means, as of any date, that portion of Total Outstanding Debt as of that date that is secured by a Lien on properties or other assets of the Company, any of its Subsidiaries or any of the Partially-Owned Entities. "SECURITIES ACT" means the Securities Act of 1933, as amended from time to time. "SHELF REGISTRATION STATEMENT" has the meaning assigned to such term in the Registration Rights Agreement. "SPECIAL RECORD DATE" has the meaning specified in Section 2.3 hereof. "SUBSIDIARY" means, with respect to any Person, a corporation, partnership association, joint venture, trust, limited liability company or other business entity which is required to be consolidated with the Company or Boston Properties in accordance with GAAP. "TARGET FILING DATE" has the meaning specified in Section 2.3 hereof. "TARGET REGISTRATION DATE" has the meaning specified in Section 2.3 hereof. "TOTAL ASSETS" means, with respect to any Incurrence of Debt or Secured Debt, as of any date, in each case as determined by the Company without duplication, the sum of: (1) Capitalized Property Value; (2) cash, cash equivalents and marketable securities of the Company and its Subsidiaries, determined in accordance with GAAP; (3) with respect to notes receivable and mortgages, the lesser of (i) the aggregate amount of principal under such note or mortgage that will be due and payable to the Company or its Subsidiaries and (ii) the purchase price paid by the Company or its Subsidiaries to acquire such note or mortgage; (4) with respect to real estate assets which are undeveloped land, the book value thereof in accordance with GAAP; (5) without duplication, the cost basis of properties of the Company and its Subsidiaries that are under development, determined in accordance with GAAP, as of the end of the quarterly period used for purposes of clause (1) above; (6) without duplication, the proceeds of the Debt or Secured Debt or the assets to be acquired in exchange for such proceeds, as the case may be, other than Intercompany Debt, Incurred from the end of the Latest Completed Quarter prior to the Incurrence of the Debt or Secured Debt, as the case may 10 be, to the date of determination; and (7) the Company's and its Subsidiaries' percentage share of Partially-Owned Entities' assets described in clauses (1), (2), (3), (4), (5) and (6) above. "TOTAL OUTSTANDING DEBT" means, as of any date, the sum, without duplication, of (1) the aggregate principal amount of all outstanding Debt of the Company as of that date; (2) the aggregate principal amount of all outstanding Debt of the Company's Subsidiaries, all as of that date; and (3) the sum of the aggregate principal amount of all Partially-Owned Entity Outstanding Debt of each of the Partially-Owned Entities multiplied by the Company's respective Percentage Interest in such Partially-Owned Entity as of that date. "TREASURY YIELD" means, with respect to any Redemption Date applicable to the Notes, the rate per annum equal to the semiannual equivalent yield to maturity (computed as of the third business day immediately preceding such Redemption Date) of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the applicable Comparable Treasury Price for such Redemption Date. "UNENCUMBERED ASSETS" means, as of any date, in each case as determined by the Company without duplication, the sum of: (1) Unencumbered Capitalized Property Value; (2) cash, cash equivalents and marketable securities of the Company and its Subsidiaries, other than restricted cash, cash equivalents and marketable securities pledged to secure Debt, determined in accordance with GAAP; (3) with respect to notes receivable and mortgages, the lesser of (i) the aggregate amount of principal under such note or mortgage that will be due and payable to the Company or its Subsidiaries and (ii) the purchase price paid by the Company or its Subsidiaries to acquire such note or mortgage, except any notes receivable or mortgages that are serving as collateral for Secured Debt; (4) with respect to real estate assets which are undeveloped land, the book value thereof in accordance with GAAP, except any land that is serving as collateral for Secured Debt; (5) without duplication, the cost basis of properties of the Company and its Subsidiaries that are under development, determined in accordance with GAAP, as of the end of the quarterly period used for purposes of clause (1) above, except any properties that are serving as collateral for Secured Debt; (6) without duplication, the proceeds of the Debt or Secured Debt or the assets to be acquired in exchange for such proceeds, as the case may be, other than Intercompany Debt, Incurred from the end of the Latest Completed Quarter prior to such date to the date of determination, except in each case any proceeds or assets that are serving as collateral for Secured Debt; and (7) the Company's and its Subsidiaries' percentage share, of Partially-Owned Entities' assets described in clauses (1), (2), (3), (4), (5) and (6) above. For the avoidance of doubt, cash held by a "qualified intermediary" in connection with proposed like-kind exchanges pursuant to Section 1031 of the Code which may be classified as "restricted" for GAAP purposes shall nonetheless be included in clause (2) above, so long as the Company or any of its Subsidiaries has the right to (i) direct the qualified intermediary to return such cash to the Company or such Subsidiary if and when the Company or such Subsidiary fails to identify or acquire the proposed like-kind property or at the end of the 180-day 11 replacement period or (ii) direct the qualified intermediary to use such cash to acquire like-kind property. "UNENCUMBERED CAPITALIZED PROPERTY VALUE" means, as of any date, the sum of (1) with respect to CBD Properties and non-CBD Properties, in each case that are not hotel properties, the aggregate of all Unencumbered Property EBITDA for each such CBD Property and non-CBD Property for the Latest Completed Quarter prior to such date, annualized (i.e., multiplied by four (4)), and capitalized at the applicable Capitalization Rate PLUS, (2) with respect to CBD Properties and non-CBD Properties, in each case that are hotel properties, the aggregate of all Unencumbered Property EBITDA for each such CBD Property and non-CBD Property for the most recent four (4) consecutive complete fiscal quarters, capitalized at the applicable Capitalization Rate; PROVIDED, HOWEVER, that if the value of a particular property calculated pursuant to clause (1) or (2) above, as applicable, is less than the undepreciated book value of such property determined in accordance with GAAP, such undepreciated book value shall be used in lieu thereof with respect to such property. "UNENCUMBERED CONSOLIDATED EBITDA" means, for any period of time, Consolidated EBITDA for such period of time less any portion thereof attributable to assets serving as collateral for Secured Debt. "UNENCUMBERED PROPERTY EBITDA" means, for any period of time, Property EBITDA for such period of time less any portion thereof attributable to assets serving as collateral for Secured Debt. "UNRESTRICTED GLOBAL NOTE" means a Global Note (other than a Regulation S Global Note) in the form of EXHIBIT A hereto that bears the Global Note Legend, and that is deposited with or on behalf of and registered in the name of the Depositary, but that does not bear and is not required to bear the Restricted Legend. "UNRESTRICTED DEFINITIVE NOTE" means one or more Definitive Notes that do not bear and are not required to bear the Restricted Legend. "UNSECURED DEBT" means, as of any date, that portion of Total Outstanding Debt as of that date that is neither Secured Debt nor Contingent Liabilities of Boston Properties Limited Partnership and Subsidiaries. "U.S. PERSON" means a "U.S. Person" as defined in Rule 902(k) under the Securities Act. 12 ARTICLE TWO THE NOTES SECTION 2.1. TITLE OF THE SECURITIES. On December 13, 2002, the Company issued a series of Securities under the First Supplemental Indenture designated the "6.25% Senior Notes due 2013." The Notes issued under this Second Supplemental Indenture are part of the same series of Securities issued by the Company under the First Supplemental Indenture. SECTION 2.2. LIMITATION ON AGGREGATE PRINCIPAL AMOUNT. The aggregate principal amount of the Notes issued under this Second Supplemental Indenture initially shall be limited to $175,000,000 and shall be part of the single series of Notes designated the "6.25% Senior Notes due 2013." The Company may, subject to Section 2.4 of this Second Supplemental Indenture and applicable law, issue additional Notes under this Second Supplemental Indenture without the consent of the Holders of outstanding Notes. The initially issued Notes and any additional Notes subsequently issued shall be treated as a single class for all purposes of this Second Supplemental Indenture. Nothing contained in this Section 2.2 or elsewhere in this Second Supplemental Indenture, or in the Notes, is intended to or shall limit execution by the Company or authentication or delivery by the Trustee of Notes under the circumstances contemplated by Sections 3.03, 3.04, 3.05, 3.06, 9.06, 11.07 and 13.05 of the Senior Indenture. SECTION 2.3. INTEREST AND INTEREST RATES; MATURITY DATE OF NOTES. (a) The Notes shall bear interest at 6.25% per annum from December 13, 2002 or from the immediately preceding Interest Payment Date (as defined below) to which interest has been paid, payable semi-annually in arrears on January 15 and July 15 of each year, commencing July 15, 2003 (each, an "Interest Payment Date"), to the persons (the "Holders") in whose name the applicable Notes are registered in the Security Register at the close of business 15 calendar days prior to such Interest Payment Date (I.E., January 1 and July 1, respectively) (regardless of whether such day is a Business Day, as defined below), as the case may be (each, a "Regular Record Date"). Interest on the Notes shall be computed on the basis of a 360-day year of twelve 30-day months. Interest, if any, not punctually paid or duly provided for on any Interest Payment Date with respect to a Note ("Defaulted Interest") shall forthwith cease to be payable to the Holder on the applicable Regular Record Date and may either be paid to the person in whose name such Note is registered at the close of business on a special record date (the "Special Record Date") for the payment of such Defaulted Interest to be fixed by the Trustee, notice of which shall be given to the Holder of such Note not less than ten days prior to such Special Record Date, or may be paid at any time in any other lawful manner, as more particularly described in the Senior Indenture. 13 (b) If any Interest Payment Date or Maturity falls on a day that is not a Business Day, the required payment shall be made on the next Business Day as if it were made on the date such payment was due and no interest shall accrue on the amount so payable for the period from and after such Interest Payment Date or Maturity, as the case may be. (c) The Notes shall mature on January 15, 2013. (d) In the event that the Exchange Offer Registration Statement or the Shelf Registration Statement, if required pursuant to the Registration Rights Agreement, has not been filed on or prior to March 10, 2003 (the "Target Filing Date"), the Company shall pay additional interest (in addition to interest otherwise due on the Notes as provided herein) ("Additional Interest") to each Holder at a per annum rate equal to 0.25% from the Target Filing Date up to but excluding the date on which the Exchange Offer Registration Statement or the Shelf Registration Statement, if required pursuant to the Registration Rights Agreement, is filed. In the event that either (i) the Exchange Offer has not been completed on or prior to July 8, 2003 (the "Target Registration Date") or (ii) the Shelf Registration Statement, if required pursuant to the Registration Rights Agreement, is not declared effective by the SEC on or prior to the Target Registration Date, the Company shall pay Additional Interest to each Holder at a per annum rate equal to 0.25% from the Target Registration Date up to but excluding the date on which the Exchange Offer is completed or the Shelf Registration Statement, if required pursuant to the Registration Rights Agreement, is declared effective by the SEC. In the event that either (x) the Exchange Offer has not been completed on or prior to October 6, 2003 (the "Extended Registration Date") or (y) the Shelf Registration Statement, if required pursuant to the Registration Rights Agreement, is not declared effective by the SEC on or prior to the Extended Registration Date, the Company shall pay Additional Interest to each Holder at a per annum rate equal to 0.25% from the Extended Registration Date up to but excluding the date on which the Exchange Offer is completed or the Shelf Registration Statement, if required pursuant to the Registration Rights Agreement, is declared effective by the SEC. Notwithstanding the foregoing, (i) no Additional Interest shall be payable to any Holder of Notes pursuant to this Section 2.3(d) if such Notes have ceased to be Registrable Securities and (ii) in no event shall the Additional Interest payable pursuant to this Section 2.3(d) exceed 0.50% per annum. The Company shall pay such Additional Interest on each Interest Payment Date, and payment of Additional Interest shall be subject to the terms and conditions of the Registration Rights Agreement. (e) There shall also be payable in respect of each Note all Additional Interest that may have accrued on such Note for which the Note was exchanged pursuant to the Exchange Offer, such Additional Interest to be calculated in accordance with the terms of such Note and payable at the same time and in the same manner as periodic interest on such Note. SECTION 2.4. LIMITATIONS ON INCURRENCE OF DEBT. In addition to the covenants set forth in Article Ten of the Senior Indenture, there are established pursuant to Section 9.01(2) of the Senior Indenture the following 14 covenants for the benefit of the Holders of the Notes and to which the Notes shall be subject: (a) The Company shall not, and shall not permit any Subsidiary to, Incur any Debt, other than Intercompany Debt, if, immediately after giving effect to the Incurrence of the additional Debt and any other Debt, other than Intercompany Debt, Incurred since the end of the Latest Completed Quarter prior to the Incurrence of the additional Debt and the application of the net proceeds of the additional Debt and such other Debt, Total Outstanding Debt would exceed 60% of Total Assets, in each case determined as of the end of such Latest Completed Quarter. (b) The Company shall not, and shall not permit any Subsidiary to, Incur any Secured Debt, other than Secured Debt that is also Intercompany Debt, if, immediately after giving effect to the Incurrence of the additional Secured Debt and any other Secured Debt, other than Intercompany Debt, Incurred since the end of the Latest Completed Quarter prior to the Incurrence of the additional Secured Debt and the application of the net proceeds of the additional Secured Debt and such other Secured Debt, the aggregate principal amount of all outstanding Secured Debt is greater than 50% of Total Assets determined as of the end of such Latest Completed Quarter. (c) The Company shall not, and shall not permit any Subsidiary to, Incur any Debt, other than Intercompany Debt, if, immediately after giving effect to the Incurrence of the additional Debt, the ratio of Annualized Consolidated EBITDA for the Latest Completed Quarter prior to the Incurrence of the additional Debt, to Annualized Interest Expense for that quarter would be less than 1.50 to 1.00 on a pro forma basis after giving effect to the Incurrence of the additional Debt and to the application of the net proceeds therefrom, and calculated on the assumption, without duplication, that: (i) the additional Debt and any other Debt Incurred by the Company, any of its Subsidiaries or any of the Partially-Owned Entities from the first day of that quarter to the date of determination, which was outstanding at the date of determination, had been Incurred at the beginning of that period and continued to be outstanding throughout that period, and the application of the net proceeds of that Debt, including to refinance (1) Debt under any revolving credit facility or (2) other Debt, had occurred at the beginning of that period; (ii) the repayment or retirement of any other Debt repaid or retired by the Company, any of its Subsidiaries or any of the Partially-Owned Entities from the first day of that quarter to the date of determination occurred at the beginning of that period; PROVIDED that, except as set forth in clause (i) or (iii) of this Section 2.4(c), in determining the amount of Debt so repaid or retired, the amount of Debt under any revolving credit facility shall be computed based upon the average daily balance of such Debt during that period; and (iii) in the case of any acquisition or disposition of any asset or group of assets or the placement of any assets in service or removal of any assets from service by the Company, any of its Subsidiaries or any of the Partially-Owned Entities from the first day of that quarter to the date of determination, including, without limitation, by merger, or stock or asset purchase or sale, (1) the acquisition, disposition, placement in service or removal from service had occurred as of the first day of that period, with the appropriate adjustments to Annualized Interest Expense with respect to the acquisition, disposition, placement in service or removal from service being included in that pro forma calculation and (2) the 15 application of the net proceeds from a disposition to repay or refinance Debt, including, without limitation, Debt under any revolving credit facility, had occurred on the first day of that period. (d) The Company and its Subsidiaries shall maintain at all times Unencumbered Assets of not less than 150% of the aggregate principal amount of all outstanding Unsecured Debt of the Company and its Subsidiaries. SECTION 2.5. OPTIONAL REDEMPTION. The Notes shall be redeemable, at the option of the Company, in whole at any time or in part from time to time, upon not less than 30 days but not more than 60 days' prior notice mailed to the registered address of each Holder of Notes to be so redeemed, at a redemption price equal to the greater of (i) 100% of the principal amount of the Notes to be redeemed or (ii) the sum of (A) the present values as of the Redemption Date of the remaining scheduled payments of principal and interest thereon from the Redemption Date to the date of Maturity (except for currently accrued but unpaid interest) discounted to the Redemption Date, on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months), at the applicable Treasury Yield, plus 35 basis points, plus (B) accrued interest to the Redemption Date. SECTION 2.6. PLACES OF PAYMENT. The Places of Payment where the Notes may be presented or surrendered for payment, where the Notes may be surrendered for registration of transfer or exchange and where notices and demands to and upon the Company in respect of the Notes and the Senior Indenture may be served shall be in the Borough of Manhattan, The City of New York, and the office or agency for such purpose shall initially be located at c/o The Bank of New York, 101 Barclay Street-21W, New York, NY 10286. SECTION 2.7. METHOD OF PAYMENT. Payment of the principal of and interest on the Notes shall be made at the office or agency of the Company maintained for that purpose in the Borough of Manhattan, The City of New York (which shall initially be an office or agency of the Trustee), in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts; PROVIDED, HOWEVER, that at the option of the Company, payments of principal and interest on the Notes (other than payments of principal and interest due at Maturity) may be made (i) by check mailed to the address of the Person entitled thereto as such address shall appear in the Security Register or (ii) by wire transfer to an account maintained by the Person entitled thereto located within the United States. SECTION 2.8. CURRENCY. Principal and interest on the Notes shall be payable in Dollars. 16 SECTION 2.9. REGISTERED SECURITIES; GLOBAL FORM. (a) GENERAL. The Notes shall be issuable and transferable in fully registered form as Registered Securities, without coupons. The Notes shall initially be issued in the form of one or more permanent Global Notes, with the Restricted Legend affixed thereto. The depository for the Notes shall be The Depository Trust Company (the "Depositary"). The Notes shall not be issuable in definitive form except as provided in Section 3.05 of the Senior Indenture. (b) RULE 144A GLOBAL NOTES. Notes offered and sold to QIBs pursuant to Rule 144A shall be issued initially in the form of one or more Rule 144A Global Notes, which shall be deposited on behalf of the purchasers of the Notes represented thereby with the Trustee, as custodian for the Depositary, duly executed by the Company and authenticated by the Trustee. Each Rule 144A Global Note shall represent such of the outstanding Notes as shall be specified therein and each shall provide that it shall represent the aggregate principal amount of outstanding Notes from time to time as conclusively reflected in the books and records of the Trustee endorsed thereon and that the aggregate principal amount of outstanding Notes represented thereby may from time to time be reduced or increased, as appropriate, to reflect exchanges and redemptions. Any change in the principal amount of a Rule 144A Global Note to reflect the amount of any increase or decrease in the aggregate principal amount of outstanding Notes represented thereby shall be made by the Trustee as the custodian for the Depositary, at the direction of the Security Registrar, in accordance with instructions given by the Holder thereof as required by Section 2.11 hereof. (c) REGULATION S GLOBAL NOTES. Notes offered and sold to QIBs which are Qualified Persons in reliance on Regulation S shall be issued initially in the form of one or more Regulation S Global Notes, which shall be deposited on behalf of the purchasers of the Notes represented thereby with the Trustee, as custodian for the Depositary, duly executed by the Company and authenticated by the Trustee. During the Restricted Period, interests in a Regulation S Global Note must be held through Euroclear or Clearstream, if the holders are Participants in such systems, or indirectly through organizations that are Participants in such systems. Following the termination of the Restricted Period, beneficial interests in a Regulation S Global Note may be held, directly or indirectly, in the account of any Participant of the Depositary. Each Regulation S Global Note shall represent such of the outstanding Notes as shall be specified therein and each shall provide that it shall represent the aggregate principal amount of outstanding Notes from time to time as conclusively reflected in the books and records of the Trustee endorsed thereon and that the aggregate principal amount of outstanding Notes represented thereby may from time to time be reduced or increased, as appropriate, to reflect exchanges and redemptions. Any change in the principal amount of a Regulation S Global Note to reflect the amount of any increase or decrease in the aggregate principal amount of outstanding Notes represented thereby shall be made by the Trustee as the custodian for the Depositary, at the direction of the Security Registrar, in accordance with instructions given by the Holder thereof as required by Section 2.11 hereof. 17 SECTION 2.10. FORM OF NOTES. The Notes shall be substantially in the form attached as EXHIBIT A hereto. SECTION 2.11. TRANSFER AND EXCHANGE. (a) TRANSFER AND EXCHANGE OF GLOBAL NOTES. A Global Note may not be transferred as a whole except by the Depositary to a nominee of the Depositary, by a nominee of the Depositary to the Depositary or to another nominee of the Depositary, or by the Depositary or any such nominee to a successor Depositary or a nominee of such successor Depositary. All Global Notes shall be exchanged by the Company for Definitive Notes if (i) the Company delivers to the Trustee notice from the Depositary stating that it is unwilling or unable to continue to act as a clearing agency for the Notes or is no longer a clearing agency registered under the Exchange Act or other applicable law and, in either case, a successor Depositary is not appointed by the Company within 90 days after the date of such notice; or (ii) the Company in its sole discretion determines that the Global Notes (in whole but not in part) should be exchanged for Definitive Notes and delivers a written notice to such effect to the Trustee; PROVIDED, that in no event shall a Regulation S Global Note be exchanged by the Company for Definitive Notes prior to the expiration of the Restricted Period. Upon the occurrence of any of the preceding events, Definitive Notes shall be issued in such names as the Depositary shall instruct the Trustee. (b) TRANSFER AND EXCHANGE OF BENEFICIAL INTERESTS IN THE GLOBAL NOTES. The transfer and exchange of beneficial interests in the Global Notes shall be effected through the Depositary in accordance with the provisions of the Senior Indenture and the applicable procedures of the Depositary. Transfers of beneficial interests in the Global Notes also shall require compliance with either subparagraph (i) or (ii) below, as applicable, as well as one or more of the other following subparagraphs, as applicable: (i) TRANSFER OF BENEFICIAL INTERESTS IN THE SAME TYPE OF GLOBAL NOTE. Beneficial interests in any Rule 144A Global Note may be transferred to Persons who take delivery thereof in the form of a beneficial interest in a Rule 144A Global Note in accordance with the transfer restrictions set forth in the Restricted Legend. Beneficial interests in any Regulation S Global Note may be transferred to Persons who take delivery thereof in the form of a beneficial interest in a Regulation S Global Note; PROVIDED, HOWEVER, that prior to the expiration of the Restricted Period beneficial interests in a Regulation S Global Note may only be held through Euroclear or Clearstream, if the holders are Participants in such systems, or indirectly through organizations that are Participants in such systems. Beneficial interests in any Unrestricted Global Note may be transferred to Persons who take delivery thereof in the form of a beneficial interest in an Unrestricted Global Note. No written orders or instructions shall be required to be delivered to the Security Registrar to effect the transfers described in this Section 2.11(b)(i). (ii) ALL OTHER TRANSFERS AND EXCHANGES OF BENEFICIAL INTERESTS IN GLOBAL NOTES. In connection with all transfers and exchanges of beneficial 18 interests that are not subject to Section 2.11(b)(i) above, and, subject to any other requirement in this Section 2.11, the transferor of such beneficial interest must deliver to the Security Registrar either: (A) (1) a written order from a Participant or an Indirect Participant given to the Depositary, Euroclear or Clearstream in accordance with the Applicable Procedures directing the Depositary to credit or cause to be credited a beneficial interest in a Global Note of another type in an amount equal to the beneficial interest to be transferred or exchanged and (2) instructions given in accordance with the Applicable Procedures containing information regarding the Participant account to be credited with such increase or (B), subject to Section 2.11(a), (1) a written order from a Participant or an Indirect Participant given to the Depositary, Euroclear or Clearstream in accordance with the Applicable Procedures directing the Depositary, Euroclear or Clearstream to cause to be issued a Definitive Note in an amount equal to the beneficial interest to be exchanged and (2) instructions given by the Depositary, Euroclear or Clearstream to the Security Registrar containing information regarding the Person in whose name such Definitive Note shall be registered to effect the exchange; PROVIDED that in no event shall Definitive Notes be issued upon the exchange of beneficial interests in a Regulation S Global Note prior to the expiration of the Restricted Period. Upon satisfaction of all of the requirements for transfer or exchange of beneficial interests in Global Notes contained herein and in the Senior Indenture and the Notes or otherwise applicable under the Securities Act, the Trustee shall adjust the principal amount of the relevant Global Note(s) pursuant to Section 2.11(h) hereof. (iii) TRANSFER AND EXCHANGE OF BENEFICIAL INTERESTS IN A RULE 144A GLOBAL NOTE FOR BENEFICIAL INTERESTS IN AN UNRESTRICTED GLOBAL NOTE. A beneficial interest in a Rule 144A Global Note may be exchanged by any holder thereof for a beneficial interest in an Unrestricted Global Note or transferred to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Note if (x) the exchange or transfer complies with the requirements of Section 2.11(b)(ii) above and (y): (A) such exchange or transfer is effected pursuant to the Exchange Offer in accordance with the Registration Rights Agreement and the holder of the beneficial interest to be transferred, in the case of an exchange, or the transferee, in the case of a transfer, certifies in the applicable Letter of Transmittal or via the Depositary's book-entry system that it is not (1) a broker-dealer, (2) a Person participating in the distribution of the Exchange Notes or (3) a Person who is an affiliate (as defined in Rule 144) of the Company, and such Letter of Transmittal or book-entry system certification shall satisfy the requirements of Section 2.11(b)(ii); (B) such transfer is effected pursuant to the Shelf Registration Statement in accordance with the Registration Rights Agreement; 19 (C) such transfer is effected by a Participating Broker-Dealer pursuant to the Exchange Offer Registration Statement in accordance with the Registration Rights Agreement; or (D) a certificate in the form of EXHIBIT B with the certification set forth in paragraph 3(d) or 4 thereof is completed, and, if the Security Registrar so requests or the Applicable Procedures so require, an Opinion of Counsel to the effect that the transfer is permitted, and that upon transfer the Notes will not be restricted under the Securities Act, is furnished to the Security Registrar. If any such transfer is effected at a time when an Unrestricted Global Note has not yet been issued, the Company shall issue and, upon receipt of a Company Order in accordance with the Senior Indenture, the Trustee shall authenticate one or more Unrestricted Global Notes in an aggregate principal amount equal to the aggregate principal amount of beneficial interests so transferred. (iv) TRANSFER OF BENEFICIAL INTERESTS TO AND FROM REGULATION S GLOBAL NOTES. (A) TRANSFER OF BENEFICIAL INTERESTS IN A REGULATION S GLOBAL NOTE PRIOR TO THE TERMINATION OF THE RESTRICTED PERIOD FOR BENEFICIAL INTERESTS IN A RULE 144A GLOBAL NOTE. A beneficial interest in any Regulation S Global Note may be transferred to a Person who takes delivery thereof in the form of a beneficial interest in a Rule 144A Global Note if (x) the transfer complies with the requirements of Section 2.11(b)(ii) above and (y) the holder of the beneficial interest in the Regulation S Global Note delivers to the Trustee and the Security Registrar a certificate in the form of EXHIBIT B hereto with the certification set forth in paragraph 1 thereof completed. (B) TRANSFER OF BENEFICIAL INTERESTS IN A REGULATION S GLOBAL NOTE FOLLOWING THE TERMINATION OF THE RESTRICTED PERIOD FOR BENEFICIAL INTERESTS IN AN UNRESTRICTED GLOBAL NOTE. A beneficial interest in any Regulation S Global Note following the termination of the Restricted Period may be transferred to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Note if (x) the transfer complies with the requirements of Section 2.11(b)(ii) above and (y) the holder of the Regulation S Global Note delivers to the Security Registrar a certificate in the form of EXHIBIT B hereto with the certification set forth in paragraph 3(d) or 4 thereof completed. (C) TRANSFER OF BENEFICIAL INTERESTS IN A RULE 144A GLOBAL NOTE FOR BENEFICIAL INTERESTS IN A REGULATION S GLOBAL NOTE. A beneficial interest in any Rule 144A Global Note may be transferred to a Person who takes delivery thereof in the form of a beneficial interest in a 20 Regulation S Global Note if (x) the transfer complies with the requirements of Section 2.11(b)(ii) above and (y) the holder of the beneficial interest in the Rule 144A Global Note delivers to the Security Registrar a certificate in the form of EXHIBIT B hereto with the certification set forth in paragraph 2 thereof completed. (c) EXCHANGE OF BENEFICIAL INTERESTS IN GLOBAL NOTES FOR DEFINITIVE NOTES. (i) BENEFICIAL INTERESTS IN RULE 144A GLOBAL NOTES OR REGULATION S GLOBAL NOTES TO UNRESTRICTED DEFINITIVE NOTES. Subject to Section 2.11(a), a holder of a beneficial interest in a Rule 144A Global Note or Regulation S Global Note may exchange such beneficial interest for an Unrestricted Definitive Note only if such exchange is in accordance with the Applicable Procedures, and, if the Security Registrar so requests or the Applicable Procedures so require, an Opinion of Counsel or other certification to the effect that the exchange is permitted, and that upon exchange the Notes will not be restricted under the Securities Act, is furnished to the Security Registrar. (ii) BENEFICIAL INTERESTS IN UNRESTRICTED GLOBAL NOTES TO UNRESTRICTED DEFINITIVE NOTES. A holder of a beneficial interest in an Unrestricted Global Note may, in the circumstances described in Section 2.11(a), exchange such beneficial interest for an Unrestricted Definitive Note. Any exchange pursuant to this Section 2.11(c) shall satisfy the requirements of Section 2.11(b)(ii). In any such case, the Trustee shall cause the aggregate principal amount of the applicable Global Note to be reduced accordingly pursuant to Section 2.11(h) hereof, and the Company shall execute and the Trustee, upon receipt of a Company Order in accordance with the Senior Indenture, shall authenticate and deliver to the Person designated in the instructions a Definitive Note in the appropriate principal amount. Any Restricted Definitive Note issued in exchange for a beneficial interest in a Global Note pursuant to this Section 2.11(c) shall be registered in such name or names and in such authorized denomination or denominations as the holder of such beneficial interest shall instruct the Security Registrar through instructions from the Depositary and the Participant or Indirect Participant. The Trustee shall deliver such Definitive Notes to the Persons in whose names such Notes are so registered. (d) TRANSFER AND EXCHANGE OF DEFINITIVE NOTES FOR DEFINITIVE NOTES. Upon request by a Holder of Definitive Notes and such Holder's compliance with the provisions of this Section 2.11(d), the Security Registrar shall register the transfer or exchange of Definitive Notes. Prior to such registration of transfer or exchange, the requesting Holder shall present or surrender to the Security Registrar the Definitive Notes duly endorsed or accompanied by a written instruction of transfer in form satisfactory to the Security Registrar duly executed by such Holder or by his attorney, duly authorized in writing. In addition, the requesting Holder shall provide any additional certifications, documents and information, as applicable, required pursuant to the following provisions of this Section 2.11(d). 21 (i) RESTRICTED DEFINITIVE NOTES TO RESTRICTED DEFINITIVE NOTES. Any Restricted Definitive Note may be transferred to and registered in the name of a Person who takes delivery thereof in the form of a Restricted Definitive Note if the Security Registrar receives the following: (A) if the transfer will be made pursuant to Rule 144A, then the transferor must deliver a certificate in the form of EXHIBIT B hereto with the certification set forth in paragraph 1 thereof completed, (B) if the transfer will be made to a Non-U.S. Person which is a QIB and a Qualified Person in an offshore transaction in accordance with Rule 903 or Rule 904, then the transferor must deliver a certificate in the form of EXHIBIT B hereto with the certification set forth in paragraph 2 thereof completed; and (C) if the transfer will be made pursuant to any other exemption from the registration requirements of the Securities Act, then the transferor must deliver an Opinion of Counsel and/or other certification in form and substance acceptable to the Security Registrar and the Company. (ii) RESTRICTED DEFINITIVE NOTES TO UNRESTRICTED DEFINITIVE NOTES. Any Restricted Definitive Note may be exchanged by the Holder thereof for an Unrestricted Definitive Note or transferred to a Person or Persons who take delivery thereof in the form of an Unrestricted Definitive Note if: (A) such exchange or transfer is effected pursuant to the Exchange Offer in accordance with the Registration Rights Agreement and the Holder, in the case of an exchange, or the transferee, in the case of a transfer, certifies in the applicable Letter of Transmittal, that it is not (1) a broker-dealer, (2) a Person participating in the distribution of the Exchange Notes or (3) a Person who is an affiliate (as defined in Rule 144) of the Company; (B) any such transfer is effected pursuant to the Shelf Registration Statement in accordance with the Registration Rights Agreement; (C) any such transfer is effected by a Participating Broker-Dealer pursuant to the Exchange Offer Registration Statement in accordance with the Registration Rights Agreement; or (D) a certificate in the form of EXHIBIT B hereto with the certification set forth in paragraph 3(d) or 4 thereof completed, and, if the Trustee and the Security Registrar so request or the Applicable Procedures so require, an Opinion of Counsel to the effect that the transfer is permitted, and that upon transfer the Notes will not be restricted under the Securities Act, is furnished to the Trustee and the Securities Registrar. 22 (iii) UNRESTRICTED DEFINITIVE NOTES TO UNRESTRICTED DEFINITIVE NOTES. A Holder of Unrestricted Definitive Notes may transfer such Notes to a Person who takes delivery thereof in the form of an Unrestricted Definitive Note. Upon receipt of a request to register such a transfer, the Security Registrar shall register the Unrestricted Definitive Notes pursuant to the instructions from the Holder thereof. (e) EXCHANGE OFFER; SHELF REGISTRATION STATEMENT. (i) Upon the occurrence of the Exchange Offer in accordance with the Registration Rights Agreement, the Company shall issue and, upon receipt of a Company Order in accordance with the Senior Indenture, the Trustee shall authenticate (x) one or more Unrestricted Global Notes in an aggregate principal amount equal to the principal amount of the beneficial interests in the Rule 144A Global Notes and Regulation S Global Notes tendered for acceptance by Persons that certify in the applicable Letters of Transmittal that (A) they are not broker-dealers, (B) they are not participating in a distribution of the Exchange Notes and (C) they are not affiliates (as defined in Rule 144) of the Company, and accepted for exchange in the Exchange Offer and (y) Definitive Notes in an aggregate principal amount equal to the principal amount of the Restricted Definitive Notes accepted for exchange in the Exchange Offer. Concurrently with the issuance of such Notes, the Trustee shall cause the aggregate principal amount of the applicable Rule 144A Global Notes and/or Regulation S Global Notes to be reduced accordingly, and the Company shall execute and the Trustee shall, upon receipt of a Company Order in accordance with the Senior Indenture, authenticate and deliver to the Persons designated by the Holders of the Restricted Definitive Notes so accepted Unrestricted Definitive Notes in the appropriate principal amount. (ii) Following the effectiveness of a Shelf Registration Statement, if any, the Company shall issue and, upon receipt of a Company Order in accordance with the Senior Indenture, the Trustee shall authenticate from time to time (x) one or more Unrestricted Global Notes, or, if there shall be at the time one or more Unrestricted Global Notes outstanding and such increase can be effected in accordance with the Applicable Procedures, the Trustee shall increase or cause to be increased the aggregate principal amount thereof, in each case in an aggregate principal amount equal to the principal amount of the beneficial interests in the Global Notes sold by Persons that certify as to the consummation of such sale under the Shelf Registration Statement in a manner acceptable to the Trustee and the Company and (y) Unrestricted Definitive Notes in an aggregate principal amount equal to the principal amount of the Restricted Definitive Notes sold by Persons that certify as to the consummation of such sale under the Shelf Registration Statement in a manner acceptable to the Trustee and the Company. Concurrently with the issuance of such Unrestricted Global Notes, the Trustee shall cause the aggregate principal amount of the applicable Rule 144A Global Notes and/or the Regulation S Global Notes to be reduced accordingly, and the Company shall execute and the Trustee shall, upon receipt of a Company Order in accordance with the Senior Indenture, authenticate and deliver to the Persons designated by the Holders of Restricted Definitive Notes so sold Unrestricted Definitive Notes in the appropriate principal amount. 23 (f) LEGENDS. (i) RESTRICTED LEGEND. Except as otherwise provided in Section 2.11(g), each Initial Note shall bear the following legend on the face thereof: THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION. EACH PURCHASER OF THIS NOTE IS HEREBY NOTIFIED THAT THE SELLER OF THIS NOTE MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED SECURITIES, FOR THE BENEFIT OF BOSTON PROPERTIES LIMITED PARTNERSHIP (THE "ISSUER"), THAT THIS SECURITY MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (A) TO THE ISSUER, (B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) TO A QUALIFIED INSTITUTIONAL BUYER WHICH IS A "QUALIFIED PERSON" WITHIN THE MEANING OF INTERNAL REVENUE CODE SECTION 49(a)(1)(D)(iv) OUTSIDE THE UNITED STATES IN A TRANSACTION COMPLYING WITH THE PROVISIONS OF RULE 904 UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" (WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF ANOTHER INSTITUTIONAL ACCREDITED INVESTOR, OR (F) UNDER ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT IF THE PURCHASER REPRESENTS THAT IT IS A "QUALIFIED PERSON" WITHIN THE MEANING OF INTERNAL REVENUE CODE SECTION 49(a)(1)(D)(iv), AND IN THE CASE OF (A) THROUGH (F) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION. EACH HOLDER WILL NOTIFY ANY PURCHASER OF THIS NOTE FROM IT OF THE RESALE RESTRICTIONS REFERENCED ABOVE. 24 THE HOLDER OF THIS SECURITY IS ENTITLED TO THE BENEFITS OF A REGISTRATION RIGHTS AGREEMENT (AS SUCH TERM IS DEFINED IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF) AND, BY ITS ACCEPTANCE HEREOF, AGREES TO BE BOUND BY AND TO COMPLY WITH THE PROVISIONS OF SUCH REGISTRATION RIGHTS AGREEMENT. (ii) REGULATION S GLOBAL NOTE LEGEND. The Regulation S Global Note shall bear the following legend on the face thereof: DURING THE RESTRICTED PERIOD (AS DEFINED IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF), INTERESTS IN THIS REGULATION S GLOBAL NOTE MAY ONLY BE HELD THROUGH EUROCLEAR AND CLEARSTREAM. (g) (i) If the Company determines (upon the advice of counsel and such other certifications as the Company may reasonably require) that any Note is eligible for resale pursuant to Rule 144(k) under the Securities Act (or a successor provision) and that the Restricted Legend is no longer necessary or appropriate in order to ensure that subsequent transfers of such Note (or a beneficial interest therein) are effected in compliance with the Securities Act, or (ii) after an Initial Note is (x) sold pursuant to an effective registration statement under the Securities Act, pursuant to the Registration Rights Agreement or otherwise, or (y) exchanged for an Exchange Note, the Company may instruct the Trustee to cancel such Note and issue to the Holder thereof (or to its transferee) a new Note of like tenor and amount, registered in the name of the Holder thereof (or its transferee), that does not bear the Restricted Legend and the Trustee will comply with such instruction. (h) CANCELLATION AND/OR ADJUSTMENT OF GLOBAL NOTES. At such time as all beneficial interests in a particular Global Note have been exchanged for Definitive Notes or a particular Global Note has been redeemed, repurchased or canceled in whole and not in part, each such Global Note shall be returned to or retained and canceled by the Trustee in accordance with the terms of the Senior Indenture. At any time prior to such cancellation, if any beneficial interest in a Global Note is exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Note or for Definitive Notes, the principal amount of Notes represented by such Global Note shall be reduced accordingly and an endorsement shall be made on such Global Note by the Trustee or by the Depositary to reflect such reduction; and if the beneficial interest is being exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Note, such other Global Note shall be increased accordingly and an endorsement shall be made on such Global Note by the Trustee or by the Depositary to reflect such increase. SECTION 2.12. GENERAL PROVISIONS RELATING TO TRANSFERS AND EXCHANGES. (a) The Trustee and the Security Registrar will retain copies of all certificates, opinions and other documents received in connection with the transfer or exchange of a Note (or a beneficial interest therein), and the Company will have the right to inspect and 25 make copies thereof at any reasonable time upon written notice to the Trustee or the Security Registrar, as the case may be. (b) By its acceptance of any Note bearing the Restricted Legend, each Holder acknowledges the restrictions on transfer of such Note set forth in this Second Supplemental Indenture and in the Restricted Legend and agrees that it will transfer such Note only as provided in this Second Supplemental Indenture. The Security Registrar shall not register a transfer of any Note unless such transfer complies with the restrictions on transfer of such Note set forth in this Second Supplemental Indenture. In connection with any transfer of a Note, each Holder agrees by its acceptance of such Note to furnish the Security Registrar or the Company such certifications, legal opinions or other information as either of them may reasonably require to confirm that such transfer is being made pursuant to an exemption from, or a transaction not subject to, the registration requirements of the Securities Act; PROVIDED, that the Security Registrar shall not be required to determine (but may rely on a determination made by the Company with respect to) the sufficiency of any such certifications, legal opinions or other information. (c) Each Holder of a Note agrees to indemnify the Company and the Trustee against any liability that may result from the transfer, exchange or assignment of such Holder's Note in violation of any provision of this Second Supplemental Indenture or applicable United States federal or state securities law. (d) The Trustee shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Second Supplemental Indenture or under applicable law with respect to any transfer of any interest in any Note (including any transfers between or among members of, or Participants or Indirect Participants in, the Depositary or beneficial owners of interests in any Global Note) other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by the terms of, this Second Supplemental Indenture, and to examine the same to determine substantial compliance as to form with the express requirements hereof. SECTION 2.13. REGISTRAR AND PAYING AGENT. The Trustee shall initially serve as Security Registrar and Paying Agent for the Notes. SECTION 2.14. DEFEASANCE. The provisions of Sections 14.02 and 14.03 of the Senior Indenture, together with the other provisions of Article Fourteen of the Senior Indenture, shall be applicable to the Notes. The provisions of Section 14.03 of the Senior Indenture shall apply to the covenants set forth in Sections 2.4 and 2.15 of this Second Supplemental Indenture and to those covenants specified in Section 14.03 of the Senior Indenture. 26 SECTION 2.15. PROVISION OF FINANCIAL INFORMATION. Whether or not the Company is subject to Section 13 or 15(d) of the Exchange Act, the Company shall, to the extent permitted under the Exchange Act, file with the Commission the annual reports, quarterly reports and other documents which the Company would have been required to file with the Commission pursuant to such Section 13 or 15(d) if the Company were so subject, such documents to be filed with the Commission on or prior to the respective dates (the "Required Filing Dates") by which the Company would have been required so to file such documents if the Company were so subject. The Company shall also in any event (x) within 15 days of each Required Filing Date (i) if the Company is not then subject to Section 13 or 15(d) of the Exchange Act, transmit by mail to all Holders, as their names and addresses appear in the Security Register, without cost to such Holders, copies of the annual reports and quarterly reports which the Company would have been required to file with the Commission pursuant to Section 13 or 15(d) of the Exchange Act if the Company were subject to such Sections, and (ii) file with the Trustee copies of annual reports, quarterly reports and other documents which the Company would have been required to file with the Commission pursuant to Section 13 or 15(d) of the Exchange Act if the Company were subject to such Sections and (y) if filing such documents by the Company with the Commission is not permitted under the Exchange Act, promptly upon written request and payment of the reasonable cost of duplication and delivery, supply copies of such documents to any prospective Holder. SECTION 2.16. WAIVER OF CERTAIN COVENANTS. Notwithstanding the provisions of Section 10.09 of the Senior Indenture, the Company may omit in any particular instance to comply with any term, provision or condition set forth in Sections 10.04 to 10.08, inclusive, of the Senior Indenture, with Sections 2.4 and 2.15 of this Second Supplemental Indenture and with any other term, provision or condition with respect to the Notes (except any such term, provision or condition which could not be amended without the consent of all Holders of the Notes), if before or after the time for such compliance the Holders of at least a majority in principal amount of all outstanding Notes, by Act of such Holders, either waive such compliance in such instance or generally waive compliance with such covenant or condition. Except to the extent so expressly waived, and until such waiver shall become effective, the obligations of the Company and the duties of the Trustee in respect of any such term, provision or condition shall remain in full force and effect. SECTION 2.17. NO SINKING FUND. The provisions of Article Twelve of the Senior Indenture shall not be applicable to the Notes. 27 SECTION 2.18. NO REPAYMENT AT OPTION OF HOLDERS. The provisions of Article Thirteen of the Senior Indenture shall not be applicable to the Notes. SECTION 2.19. DESIGNATION OF CBD PROPERTIES. From time to time, the Company may designate one or more additional properties as CBD Properties by delivering an Officers' Certificate, in substantially the form attached hereto as EXHIBIT C, to the Trustee (i) setting forth the name of such property and (ii) certifying that, in the good faith opinion of such officers, such property is located in the central business district of a CBD Market. Upon delivery of such Officers' Certificate to the Trustee, such property shall be a CBD Property for all purposes of this Second Supplemental Indenture. ARTICLE THREE MISCELLANEOUS PROVISIONS SECTION 3.1. RATIFICATION OF SENIOR INDENTURE. Except as expressly modified or amended hereby, the Senior Indenture continues in full force and effect and is in all respects confirmed, ratified and preserved. SECTION 3.2. GOVERNING LAW. This Second Supplemental Indenture and each Note shall be governed by and construed in accordance with the laws of the State of New York. This Second Supplemental Indenture is subject to the provisions of the Trust Indenture Act of 1939, as amended, and shall, to the extent applicable, be governed by such provisions. SECTION 3.3. COUNTERPARTS. This Second Supplemental Indenture may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument. SECTION 3.4. TRUSTEE. The Trustee makes no representations as to the validity or sufficiency of this Second Supplemental Indenture. The statements and recitals herein are deemed to be those of the Company and not of the Trustee. 28 IN WITNESS WHEREOF, the parties hereto have caused this Second Supplemental Indenture to be duly executed by their respective officers hereunto duly authorized, all as of the day and year first written above. BOSTON PROPERTIES LIMITED PARTNERSHIP By: Boston Properties, Inc., its general partner By: /s/ Edward H. Linde ------------------------------------------- Name: Edward H. Linde Title: President and Chief Executive Officer THE BANK OF NEW YORK, as Trustee By: /s/ Kisha A. Holder ------------------------------------------- Name: Kisha A. Holder Title: Assistant Treasurer 29 SCHEDULE A CBD PROPERTIES SC-A-1
PROPERTY LOCATION -------- -------- 265 Franklin Street Boston, MA Prudential Center Tower Boston, MA 101 Huntington Avenue Boston, MA Prudential Center Retail Boston, MA Prudential Lord & Taylor Boston, MA Prudential Saks 5th Avenue Boston, MA 111 Huntington Retail Boston, MA 111 Huntington Avenue Boston, MA Huntington Retail Parcel Boston, MA Prudential Center Garage Boston, MA Cambridge Center One Cambridge, MA Cambridge Center Three Cambridge, MA Cambridge Center Eight Cambridge, MA Cambridge Center Ten Cambridge, MA Cambridge Center Eleven Cambridge, MA Cambridge Center Fourteen Cambridge, MA University Place Cambridge, MA Cambridge Center North Garage Cambridge, MA Citigroup Center New York, NY 599 Lexington Avenue New York, NY 280 Park Avenue New York, NY 875 Third Avenue New York, NY 5 Times Square New York, NY Times Square Tower New York, NY 399 Park Avenue New York, NY 100 East Pratt Street Baltimore, MD Riverfront Plaza Richmond, VA Embarcadero Center One San Francisco, CA Embarcadero Center Two San Francisco, CA Embarcadero Center Three San Francisco, CA Embarcadero Center Four San Francisco, CA Federal Reserve San Francisco, CA West Tower San Francisco, CA Metropolitan Square Washington, DC Market Square North Washington, DC 1301 New York Avenue Washington, DC Capital Gallery Washington, DC 500 E Street Washington, DC Sumner Square Washington, DC Shaw Pittman Building Washington, DC 901 New York Avenue Washington, DC SCHEDULE B CBD MARKETS Los Angeles, California Orange County, California San Francisco, California San Jose, California Denver, Colorado Washington, D.C. Miami, Florida Atlanta, Georgia Chicago, Illinois Baltimore, Maryland Boston, Massachusetts Cambridge, Massachusetts Detroit, Michigan Minneapolis, Minnesota New York, New York Portland, Oregon Philadelphia, Pennsylvania Dallas, Texas Houston, Texas Richmond, Virginia Seattle, Washington SC-B-1 EXHIBIT A FORM OF NOTE [Face of Security] [If this Security is an Initial Note, insert: THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION. EACH PURCHASER OF THIS NOTE IS HEREBY NOTIFIED THAT THE SELLER OF THIS NOTE MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED SECURITIES, FOR THE BENEFIT OF BOSTON PROPERTIES LIMITED PARTNERSHIP (THE "ISSUER"), THAT THIS SECURITY MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (A) TO THE ISSUER, (B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) TO A QUALIFIED INSTITUTIONAL BUYER WHICH IS A "QUALIFIED PERSON" WITHIN THE MEANING OF INTERNAL REVENUE CODE SECTION 49(a)(1)(D)(iv) OUTSIDE THE UNITED STATES IN A TRANSACTION COMPLYING WITH THE PROVISIONS OF RULE 904 UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" (WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF ANOTHER INSTITUTIONAL ACCREDITED INVESTOR, OR (F) UNDER ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT IF THE PURCHASER REPRESENTS THAT IT IS A "QUALIFIED PERSON" WITHIN THE MEANING OF INTERNAL REVENUE CODE SECTION 49(a)(1)(D)(iv), AND IN THE CASE OF (A) THROUGH (F) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION. A-1 EACH HOLDER WILL NOTIFY ANY PURCHASER OF THIS NOTE FROM IT OF THE RESALE RESTRICTIONS REFERENCED ABOVE. THE HOLDER OF THIS SECURITY IS ENTITLED TO THE BENEFITS OF A REGISTRATION RIGHTS AGREEMENT (AS SUCH TERM IS DEFINED IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF) AND, BY ITS ACCEPTANCE HEREOF, AGREES TO BE BOUND BY AND TO COMPLY WITH THE PROVISIONS OF SUCH REGISTRATION RIGHTS AGREEMENT.] [If this Security is a Regulation S Global Note, insert: DURING THE RESTRICTED PERIOD (AS DEFINED IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF), INTERESTS IN THIS REGULATION S GLOBAL NOTE MAY ONLY BE HELD THROUGH EUROCLEAR AND CLEARSTREAM.] [If the Holder of this Security (as indicated below) is The Depository Trust Company ("DTC") or a nominee of DTC, insert: UNLESS THIS SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND SUCH SECURITY ISSUED IS REGISTERED IN THE NAME OF CEDE & CO., OR IN SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL, INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. UNLESS AND UNTIL THIS SECURITY IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN CERTIFICATED FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY DTC TO A NOMINEE THEREOF OR BY A NOMINEE THEREOF TO DTC OR ANOTHER NOMINEE OF DTC OR BY DTC OR ANY SUCH NOMINEE TO A SUCCESSOR OF DTC OR A NOMINEE OF SUCH SUCCESSOR.] BOSTON PROPERTIES LIMITED PARTNERSHIP 6.25% Senior Notes due 2013 No. ______ $_____ CUSIP No. _______ BOSTON PROPERTIES LIMITED PARTNERSHIP, a Delaware limited partnership (herein referred to as the "Company," which term includes any successor corporation under the Indenture referred to on the reverse hereof), for value received, hereby promises to pay to __________ or registered assigns the principal sum of ________ January 15, 2013 (the "Stated Maturity Date") or earlier at the option of the Company as provided herein (the "Redemption Date") and to pay interest thereon from December 13, 2003 or from the most recent Interest Payment Date to which interest has been paid or duly provided for, semi-annually on January 15 and July 15 in each year A-2 (each, an "Interest Payment Date"), commencing July 15, 2003, at the rate of 6.25% per annum, until the principal hereof is paid or duly provided for. The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will, as provided in such Indenture, be paid to the Holder in whose name this Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest, which shall be the January 1 or July 1 (whether or not a Business Day), as the case may be, next preceding such Interest Payment Date at the office or agency of the Company maintained for such purpose; PROVIDED, HOWEVER, that such interest may be paid, at the Company's option, by mailing a check to such Holder at its registered address or by transfer of funds to an account maintained by such Holder within the United States. Any such interest not so punctually paid or duly provided for shall forthwith cease to be payable to the Holder on such Regular Record Date, and may be paid to the Holder in whose name this Security (or one or more Predecessor Securities) is registered at the close of business on a Special Record Date for the payment of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to Holders of Securities of this series not less than 10 days prior to such Special Record Date, or may be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Securities of this series may be listed, and upon such notice as may be required by such exchange, all as more fully provided in the Indenture. Interest will be computed on the basis of a 360-day year of twelve 30-day months. The principal of this Security payable on the Stated Maturity Date or the principal of, premium or Make-Whole Amount, if any, and, if the Redemption Date is not an Interest Payment Date, interest on this Security payable on the Redemption Date, will be paid against presentation of this Security at the office or agency of the Company maintained for that purpose in the Borough of Manhattan, The City of New York, in such coin or currency of the United States of America as at the time of payment is legal tender for the payment of public and private debts. Interest payable on this Security on any Interest Payment Date and on the Stated Maturity Date or Redemption Date, as the case may be, will include interest accrued from and including the next preceding Interest Payment Date in respect of which interest has been paid or duly provided for (or from and including December 13, 2002, if no interest has been paid on this Security) to but excluding such Interest Payment Date or the Stated Maturity Date or Redemption Date, as the case may be. If any Interest Payment Date or the Stated Maturity Date or Redemption Date falls on a day that is not a Business Day, as defined below, principal, premium or Make-Whole Amount, if any, and/or interest payable with respect to such Interest Payment Date or Stated Maturity Date or Redemption Date, as the case may be, will be paid on the next succeeding Business Day with the same force and effect as if it were paid on the date such payment was due, and no interest shall accrue on the amount so payable for the period from and after such Interest Payment Date or Stated Maturity Date or Redemption Date, as the case may be. "Business Day" means any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions in The City of New York are required or authorized by law, regulation or executive order to close. A-3 [If this Security is a Global Note, insert: All payments of principal, premium or Make-Whole Amount, if any, and interest in respect of this Security will be made by the Company in immediately available funds.] Reference is hereby made to the further provisions of this Security set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place. Unless the Certificate of Authentication hereon has been executed by the Trustee by manual signature of one of its authorized signatories, this Security shall not be entitled to any benefit under the Indenture, or be valid or obligatory for any purpose. A-4 IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed under its facsimile corporate seal. Dated: ______________ BOSTON PROPERTIES LIMITED PARTNERSHIP By: Boston Properties, Inc., its general partner By: ----------------------------------------------- Name: Title: Attest: - ----------------------- Secretary CERTIFICATE OF AUTHENTICATION This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture. THE BANK OF NEW YORK, as Trustee Dated: By: ------------------ --------------------------------- Authorized Signatory A-5 [Reverse of Security] BOSTON PROPERTIES LIMITED PARTNERSHIP This Security is one of a duly authorized issue of securities of the Company (herein called the "Securities"), issued and to be issued in one or more series under an Indenture, dated as of December 13, 2002, as supplemented by Supplemental Indenture No. 2, dated as of January 17, 2003 (as so supplemented, herein called the "Indenture"), each between the Company and The Bank of New York, as Trustee (herein called the "Trustee," which term includes any successor trustee under the Indenture with respect to the series of which this Security is a part), to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Securities, and of the terms upon which the Securities are, and are to be, authenticated and delivered. This Security shall be part of the single series of notes known as the Company's 6.25% Senior Notes due 2013. The aggregate principal amount of the Securities to be issued under this Indenture is limited to $175,000,000 (except for Securities authenticated and delivered upon transfer of, or in exchange for, or in lieu of other Securities). All terms used in this Security which are defined in the Indenture shall have the meanings assigned to them in the Indenture. If an Event of Default, as defined in the Indenture, with respect to the Securities shall occur and be continuing, the principal of the Securities of this series may be declared due and payable in the manner and with the effect provided in the Indenture. The Securities are subject to redemption, at the option of the Company, in whole at any time or in part from time to time at a redemption price equal to the greater of (i) 100% of the principal amount of the Securities to be redeemed or (ii) the sum of (A) the present values of the remaining scheduled payments of principal and interest thereon from the Redemption Date to the date of Maturity (except for currently accrued but unpaid interest) discounted to the Redemption Date, on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months), at the applicable Treasury Yield, plus 35 basis points, plus (B) accrued interest to the Redemption Date. Notice of redemption will be given by mail to Holders of Securities, not less than 30 nor more than 60 days prior to the Redemption Date, all as provided in the Indenture. In the event of redemption of this Security in part only, a new Security or Securities for the unredeemed portion hereof shall be issued in the name of the Holder hereof upon the cancellation hereof. In the event that the Exchange Offer Registration Statement or the Shelf Registration Statement, if required pursuant to the Registration Rights Agreement, has not been filed on or prior to March 10, 2003 (the "Target Filing Date"), the Company shall pay additional interest (in addition to interest otherwise due on the Notes as provided herein) ("Additional Interest") to each Holder at a per annum rate equal to 0.25% from the Target Filing Date up to but excluding the date on which the Exchange A-6 Offer Registration Statement or the Shelf Registration Statement, if required pursuant to the Registration Rights Agreement, is filed. In the event that either (i) the Exchange Offer has not been completed on or prior to July 8, 2003 (the "Target Registration Date") or (ii) the Shelf Registration Statement, if required pursuant to the Registration Rights Agreement, is not declared effective by the SEC on or prior to the Target Registration Date, the Company shall pay Additional Interest to each Holder at a per annum rate equal to 0.25% from the Target Registration Date up to but excluding the date on which the Exchange Offer is completed or the Shelf Registration Statement, if required pursuant to the Registration Rights Agreement, is declared effective by the SEC. In the event that either (x) the Exchange Offer has not been completed on or prior toOctober 6, 2003 (the "Extended Registration Date") or (y) the Shelf Registration Statement, if required pursuant to the Registration Rights Agreement, is not declared effective by the SEC on or prior to the Extended Registration Date, the Company shall pay Additional Interest to each Holder at a per annum rate equal to 0.25% from the Extended Registration Date up to but excluding the date on which the Exchange Offer is completed or the Shelf Registration Statement, if required pursuant to the Registration Rights Agreement, is declared effective by the SEC. Notwithstanding the foregoing, (i) no Additional Interest shall be payable to any Holder of Securities pursuant to this provision if such Securities have ceased to be Registrable Securities and (ii) in no event shall the Additional Interest payable pursuant to this provision exceed 0.50% per annum. The Company shall pay such Additional Interest on each Interest Payment Date, and payment of Additional Interest shall be subject to the terms and conditions of the Registration Rights Agreement. The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Holders of the Securities under the Indenture at any time by the Company and the Trustee with the consent of the Holders of not less than a majority of the aggregate principal amount of all Securities issued under the Indenture at the time Outstanding and affected thereby. The Indenture also contains provisions permitting the Holders of not less than a majority of the aggregate principal amount of the Outstanding Securities, on behalf of the Holders of all such Securities, to waive compliance by the Company with certain provisions of the Indenture. Furthermore, provisions in the Indenture permit the Holders of not less than a majority of the aggregate principal amount, in certain instances, of the Outstanding Securities of any series to waive, on behalf of all of the Holders of Securities of such series, certain past defaults under the Indenture and their consequences. Any such consent or waiver by the Holder of this Security shall be conclusive and binding upon such Holder and upon all future Holders of this Security and other Securities issued upon the registration of transfer hereof or in exchange herefor or in lieu hereof, whether or not notation of such consent or waiver is made upon this Security. No reference herein to the Indenture and no provision of this Security or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of (and premium or Make-Whole Amount, if any) and interest on this Security at the times, places and rate, and in the coin or currency, herein prescribed. A-7 As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Security is registrable in the Security Register of the Company upon surrender of this Security for registration of transfer at the office or agency of the Company in any place where the principal of (and premium or Make-Whole Amount, if any) and interest on this Security are payable, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar duly executed by, the Holder hereof or by his attorney duly authorized in writing, and thereupon one or more new Securities, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees. As provided in the Indenture and subject to certain limitations therein set forth, this Security is exchangeable for a like aggregate principal amount of Securities of different authorized denominations but otherwise having the same terms and conditions, as requested by the Holder hereof surrendering the same. The Securities of this series are issuable only in registered form without coupons in denominations of $1,000 and any integral multiple thereof. No service charge shall be made for any such registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith. Prior to due presentment of this Security for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name this Security is registered as the owner hereof for all purposes, whether or not this Security be overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the contrary. No recourse shall be had for the payment of the principal of or premium or Make-Whole Amount, if any, or the interest on this Security, or for any claim based hereon, or otherwise in respect hereof, or based on or in respect of the Indenture or any indenture supplemental thereto, against any past, present or future stockholder, employee, officer or director, as such, of Boston Properties or of any successor, either directly or through Boston Properties or any successor, whether by virtue of any constitution, statute or rule of law or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance hereof and as part of the consideration for the issue hereof, expressly waived and released. The Indenture and the Securities shall be governed by and construed in accordance with the laws of the State of New York applicable to agreements made and to be performed entirely in such State. A-8 ASSIGNMENT FORM To assign this Security, fill in the form below: (I) or (we) assign and transfer this Security to - ------------------------------------------------------------------------------- (Insert assignee's soc. sec. or tax I.D. no.) - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- (Print or type assignee's name, address and zip code and irrevocably appoint______________________________________ to transfer this Security on the books of the Company. The agent may substitute another to act for him. - ------------------------------------------------------------------------------- Date: Your Signature: --------------------- ------------------------- (Sign exactly as your name appears on the face of this Security) Tax Identification No: ------------------- SIGNATURE GUARANTEE: --------------------- Signatures must be guaranteed by an "eligible guarantor institution" meeting the requirements of the Security Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program ("STAMP") or such other "signature guarantee program" as may be determined by the Security Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended. A-9 SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE The following exchanges of a part of this Global Note for an interest in another Global Note or for a Definitive Note, or exchanges of a part of another Global Note or Definitive Note for an interest in this Global Note, have been made: A-10
Amount of Amount of Principal amount decrease increase of this Global Note Signature of in principal in principal following such authorized officer amount of this amount of this decrease of Trustee or Date of Exchange Global Note Global Note (or increase) Note Custodian EXHIBIT B FORM OF TRANSFER CERTIFICATE Boston Properties Limited Partnership 800 Boylston Street Suite 400 Boston, Massachusetts 02199 Attention:[______________] The Bank of New York 101 Barclay Street-21W New York, New York 10286 Attention:[______________] Re: 6.25% SENIOR NOTES DUE 2013 Reference is hereby made to Supplemental Indenture No. 2, dated as of January 17, 2003 (the "Supplemental Indenture"), between Boston Properties Limited Partnership (the "Company") and The Bank of New York, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Supplemental Indenture. _______________, (the "Transferor") owns and proposes to transfer the Note[s] or interest in such Note[s] specified in Annex A hereto, in the principal amount of $ in such Note[s] or interests (the "Transfer"), to (the "Transferee"), as further specified in Annex A hereto. In connection with the Transfer, the Transferor hereby certifies that: [CHECK ALL THAT APPLY] (1) / / CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN A 144A GLOBAL NOTE OR A RESTRICTED DEFINITIVE NOTE PURSUANT TO RULE 144A. The Transfer is being effected pursuant to and in accordance with Rule 144A under the United States Securities Act of 1933, as amended (the "Securities Act"), and, accordingly, the Transferor hereby further certifies that the beneficial interest or Restricted Definitive Note is being transferred to a Person that the Transferor reasonably believed and believes is purchasing the beneficial interest or Restricted Definitive Note for its own account, or for one or more accounts with respect to which such Person exercises sole investment discretion, and such Person and each such account is a "qualified institutional buyer" within the meaning of Rule 144A in a transaction meeting the requirements of Rule 144A and such Transfer is in compliance with any applicable blue sky securities laws of any state of the United States. Upon consummation of the proposed Transfer in accordance with the terms of the Supplemental Indenture, the transferred beneficial interest or Restricted Definitive Note will be subject to the restrictions on transfer enumerated in the Restricted Legend printed on the 144A Global Note and/or the Restricted Definitive Note and in the Supplemental Indenture and under the Securities Act. (2) / / CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN A REGULATION S GLOBAL NOTE OR A RESTRICTED DEFINITIVE NOTE PURSUANT TO REGULATION S. The Transfer is being effected pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and, B-1 accordingly, the Transferor hereby further certifies that (i) the Transfer is not being made to a person in the United States and (x) at the time the buy order was originated, the Transferee was outside the United States or such Transferor and any Person acting on its behalf reasonably believed and believes that the Transferee was outside the United States or (y) the transaction was executed in, on or through the facilities of a designated offshore securities market and neither such Transferor nor any Person acting on its behalf knows that the transaction was prearranged with a buyer in the United States, (ii) no directed selling efforts have been made in contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S under the Securities Act, (iii) the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act, (iv) the transfer is being made to a person which is a QIB and a Qualified Person and (v) if the proposed transfer is being made prior to the expiration of the Restricted Period, the transfer is not being made to a U.S. Person or for the account or benefit of a U.S. Person (other than one of the Initial Purchasers). Upon consummation of the proposed transfer in accordance with the terms of the Supplemental Indenture, the transferred beneficial interest or Restricted Definitive Note will be subject to the restrictions on Transfer enumerated in the Restricted Legend printed on the Regulation S Global Note and/or the Restricted Definitive Note and in the Supplemental Indenture and under the Securities Act. (3) / / CHECK AND COMPLETE IF TRANSFEREE WILL TAKE DELIVERY OF A DEFINITIVE NOTE PURSUANT TO ANY PROVISION OF THE SECURITIES ACT OTHER THAN RULE 144A OR REGULATION S. The Transfer is being effected in compliance with the transfer restrictions applicable to beneficial interests in Restricted Global Notes and Restricted Definitive Notes and pursuant to and in accordance with the Securities Act and any applicable blue sky securities laws of any state of the United States, and accordingly the Transferor hereby further certifies that (check one): (a) / / such Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act; (b) / / such Transfer is being effected to the Company or a subsidiary thereof; (c) / / such Transfer is being effected to an institutional "accredited investor" (within the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act); or (d) / / such Transfer is being effected pursuant to an effective registration statement under the Securities Act and in compliance with the prospectus delivery requirements of the Securities Act. B-2 (4) / / CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE OR OF AN UNRESTRICTED DEFINITIVE NOTE. (a) / / CHECK IF TRANSFER IS PURSUANT TO RULE 144. (i) The Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act and in compliance with the transfer restrictions contained in the Supplemental Indenture and any applicable blue sky securities laws of any state of the United States and (ii) the restrictions on transfer contained in the Supplemental Indenture and the Restricted Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Supplemental Indenture, the transferred beneficial interest or Definitive Note will no longer be subject to the restrictions on transfer enumerated in the Restricted Legend printed on the Restricted Global Notes, on Restricted Definitive Notes and in the Supplemental Indenture. (b) / / CHECK IF TRANSFER IS PURSUANT TO REGULATION S. (i) The Transfer is being effected pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and in compliance with the transfer restrictions contained in the Supplemental Indenture and any applicable blue sky securities laws of any state of the United States and (ii) the restrictions on transfer contained in the Supplemental Indenture and the Restricted Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Supplemental Indenture, the transferred beneficial interest or Definitive Note will no longer be subject to the restrictions on transfer enumerated in the Restricted Legend printed on the Restricted Global Notes, on Restricted Definitive Notes and in the Supplemental Indenture. (c) / / CHECK IF TRANSFER IS PURSUANT TO OTHER EXEMPTION. (i) The Transfer is being effected pursuant to and in compliance with an exemption from the registration requirements of the Securities Act other than Rule 144, Rule 903 or Rule 904 and in compliance with the transfer restrictions contained in the Supplemental Indenture and any applicable blue sky securities laws of any State of the United States and (ii) the restrictions on transfer contained in the Supplemental Indenture and the Restricted Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Supplemental Indenture, the transferred beneficial interest or Definitive Note will not be subject to the restrictions on transfer enumerated in the Restricted Legend printed on the Restricted Global Notes or Restricted Definitive Notes and in the Supplemental Indenture. This certificate and the statements contained herein are made for the benefit of the Trustee and the Company. [Insert Name of Transferor] By: ------------------------------------- Name: Title: Dated: ------------------------- B-3 ANNEX A-1 ANNEX A 1. The Transferor owns and proposes to transfer the following: [CHECK ONE OF (a) OR (b)] (a) / / a beneficial interest in the: (i) / / 144A Global Note (CUSIP 10112RAA2), or (ii) / / Regulation S Global Note (CUSIP U07978AA4); or (b) / / a Restricted Definitive Note. 2. After the Transfer the Transferee will hold: [CHECK ONE] (a) / / a beneficial interest in the: (i) / / 144A Global Note (CUSIP 10112RAA2), or (ii) / / Regulation S Global Note (CUSIP U07978AA4); or (iii) / / Unrestricted Global Note (CUSIP 10112RAB0); or (b) / / a Restricted Definitive Note; or (c) / / an Unrestricted Definitive Note, in accordance with the terms of the Supplemental Indenture. ANNEX A-1 EXHIBIT C FORM OF OFFICERS' CERTIFICATE Reference is made to Supplemental Indenture No. 2, dated as of January 17, 2003 (the "Supplemental Indenture"), between Boston Properties Limited Partnership (the "Company") and The Bank of New York, as trustee. Pursuant to Section 2.19 of the Supplemental Indenture, each of the undersigned officers of Boston Properties, Inc., the general partner of the Company, hereby certifies that in his good faith judgment the properties listed on the schedule attached hereto are located in a central business district of a CBD Market (as such term is defined in the Supplemental Indenture). In accordance with Section 2.19 of the Supplemental Indenture, each such property listed on such schedule shall be a CBD Property for all purposes of the Supplemental Indenture. ----------------------------------------- Name: Title: ----------------------------------------- Name: Title: Dated: ----------------------- C-1
EXHIBIT 99.1 [LOGO] BOSTON PROPERTIES SUPPLEMENTAL OPERATING AND FINANCIAL DATA FOR THE QUARTER ENDED DECEMBER 31, 2002 BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 INDEX 2
PAGE PAGE -------- -------- Company Background.............................. 3 Retail Properties -- Lease Expiration Roll Out............................................. 28 Investor Information............................ 4-5 Grand Total -- Office, Office/Technical, Industrial and Retail Properties................ 29 Financial Highlights............................ 6 Boston Area Lease Expiration Roll Out........... 30-31 Consolidated Balance Sheets..................... 7 Washington DC Area Lease Expiration Roll Out.... 32-33 Consolidated Income Statements.................. 8 San Francisco Area Lease Expiration Roll Out.... 34-35 Funds From Operations........................... 9 New York Area Lease Expiration Roll Out......... 36-37 Capital Structure............................... 10 Princeton Area Lease Expiration Roll Out........ 38-39 Debt Analysis................................... 11-14 Other Area Lease Expiration Roll Out............ 40-41 Unconsolidated Joint Ventures................... 15-16 CBD/Suburban Lease Expiration Roll Out.......... 42-43 Portfolio Overview -- Square Footage............ 17 Hotel Performance............................... 44 Property Listing................................ 18-21 Same Property Performance....................... 45 Top 20 Tenants.................................. 22 In-Service Property Performance................. 46 Portfolio Overview -- FFO....................... 23 Capital Expenditures............................ 47 Occupancy Analysis.............................. 24 Value Creation Pipeline -- Acquisitions/Dispositions....................... 48 Office Properties -- Lease Expiration Roll Out.. 25 Value Creation Pipeline -- Development.......... 49 Office/Technical Properties -- Lease Expiration Value Creation Pipeline -- Land Parcels......... 50 Roll Out...................................... 26 Industrial Properties -- Lease Expiration Roll Out........................................... 27 BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 COMPANY BACKGROUND Boston Properties, Inc. (the "Company"), a self-administered and self-managed real estate investment trust, is one of the largest owners, managers and developers of first-class office properties in the United States, with a significant presence in four core markets: Boston, Washington, D.C., Midtown Manhattan and San Francisco. Boston Properties was founded in 1970 in Boston, where it maintains its headquarters. The Company acquires, develops and manages its properties through full-service regional offices in Boston, New York City, Washington, D.C., San Francisco and Princeton, New Jersey. Its property portfolio primarily comprises first-class office space and also includes hotels and industrial buildings. On December 13, 2002, Boston Properties Limited Partnership, the Company's Operating Partnership ("BPLP") closed on an offering of $750 million in aggregate principal amount of its 6.25% senior unsecured notes due 2013. The notes were priced at 99.65% of their face amount to yield 6.296%. In addition, BPLP reopened this offering and closed on an additional $175 million on January 17, 2003. The additional notes were priced at 99.763% of their face amount to yield 6.28%. BPLP's bonds have been rated Baa2, BBB, BBB by Moody's, Standard & Poor's and FitchRatings, respectively. Since the Company's initial offering in June 1997, the Company has acquired 51 properties adding approximately 20.1 million square feet to its portfolio, representing an investment of approximately $5.8 billion, and the Company has delivered 34 development properties adding approximately 6.9 million square feet to its portfolio, representing an investment of approximately $1.5 billion. In addition, the Company is constructing five office properties and one retail property for a total anticipated investment of approximately $934.7 million. The Company owns or controls land where it can develop an additional 8.8 million square feet. 3 BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 INVESTOR INFORMATION 111 Huntington Avenue Boston, MA 02199-7610 (617) 236-3300 (617) 236-3311 (fax) TIMING Quarterly results for 2003 will be announced according to the following anticipated schedule:
KEY EMPLOYEES: Mortimer B. Zuckerman................................... Chairman of the Board Edward H. Linde......................................... President, CEO and Director Robert E. Burke......................................... Executive Vice President, Operations Douglas T. Linde........................................ Senior Vice President, CFO and Treasurer 4
First Quarter........................................... Late April Second Quarter.......................................... Late July Third Quarter........................................... Late October Fourth Quarter.......................................... Late January BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 COMMON STOCK DATA (NYSE:BXP) Boston Properties' common stock is traded primarily on the New York Stock Exchange under the symbol: BXP. BXP's common stock has had the following characteristics (based on New York Stock Exchange closing prices): (1) Reflects dividend increase from $0.58 per share to $0.61 per share effective Q2 2002. BPLP UNSECURED SENIOR NOTES
4TH QUARTER 2002 3RD QUARTER 2002 2ND QUARTER 2002 1ST QUARTER 2002 ---------------- ---------------- ---------------- ---------------- High Price............................... $ 37.4300 $ 39.8700 $ 41.5500 $ 39.8200 Low Price................................ $ 33.9300 $ 34.5600 $ 37.8800 $ 35.9800 Closing Price............................ $ 36.8600 $ 37.2000 $ 39.9500 $ 39.4500 Dividends per share -- annualized (1).... $ 2.44 $ 2.44 $ 2.44 $ 2.32 Closing dividend yield -- annualized..... 6.62% 6.56% 6.11% 5.88% Closing shares, common units and preferred units (if converted) outstanding (thousands)................ 125,038 125,031 125,017 124,761 Closing market value of shares and units outstanding (thousands)................ $4,608,901 $4,651,153 $4,994,429 $4,921,821 (1) Reopened for an additional issuance of $175 million on 1/17/03 at a yield of 6.28%. 5
Settlement Date............................................. 12/13/02 Principal Amount............................................ $750,000,000(1) Yield....................................................... 6.296% Coupon...................................................... 6.250% Discount.................................................... 99.650% Ratings: Moody's................................................... Baa2 (stable) S&P....................................................... BBB (stable) Fitch..................................................... BBB (stable) Maturity Date............................................... 1/15/13 BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 FINANCIAL HIGHLIGHTS (UNAUDITED AND IN THOUSANDS)
THREE MONTHS ENDED ----------------------------------------------------------------------- DECEMBER 31, 2002 SEPTEMBER 30, 2002 JUNE 30, 2002 MARCH 31, 2002 ----------------- ------------------ ------------- -------------- Income Items: Revenue.................................. $345,953(1) $313,654(1) $295,595 $279,620 Net straight line rent................... $ 11,938 $ 12,244 $ 12,216 $ 14,784 Lease termination fees................... $ 3,724 $ 1,858 $ 1,227 $ 511 Capitalized interest..................... $ 4,719 $ 4,684 $ 5,261 $ 7,847 Operating Margins [(rental revenues -- rental expenses)/rental revenues]...... 69.1%(2) 67.0% 69.9% 68.8% Net income available to common shareholders before net derivative losses (SFAS No.133)................... $261,348 $ 75,886 $ 58,714 $ 55,613 Funds from operations (FFO) before net derivative losses (SFAS No.133) and after early surrender lease payments received -- basic...................... $137,852 $120,358 $120,263 $108,820 Company's share.......................... $113,464 $ 98,980 $ 98,165 $ 88,929 FFO per share before net derivative losses (SFAS 133) and after cash basis early surrender lease income -- basic.................................. $ 1.19 $ 1.04 $ 1.07 $ 0.98 FFO per share before net derivative losses (SFAS 133) and after cash basis early surrender lease income -- diluted................................ $ 1.14 $ 1.00 $ 1.02 $ 0.93 Net income available to common shareholders per share -diluted........ $ 2.70 $ 0.74 $ 0.59 $ 0.60 Dividends per share...................... $ 0.61 $ 0.61 $ 0.61 $ 0.58 Funds available for distribution (FAD) (3).................................... $112,377 $ 95,901 $ 87,470 $ 81,799 Ratios: Interest Coverage Ratio (excluding capitalized interest) -- cash basis (4).................................... 2.87 2.70 2.71 2.57 Interest Coverage Ratio (including capitalized interest) -- cash basis (4).................................... 2.69 2.50 2.51 2.29 FFO Payout Ratio......................... 53.51% 61.00% 59.80% 62.37% FAD Payout Ratio......................... 62.88% 73.44% 78.15% 78.92% (1) Includes gross revenues from hotels of $24,779 and $20,007 for the three months ended December 31, 2002 and September 30, 2002, respectively. (2) Exclusive of the gross up of reimbursable electricity amounts totalling $6,476, $6,329, $6,404 and $5,928 for the quarters ended December 31, 2002, September 30, 2002, June 30, 2002 and March 31, 2002, respectively. (3) FAD is defined as FFO after adjustments for second generation lease commissions and tenant improvements, recurring capital expenditures, straight-line rents, preferred dividends and distributions and other non-cash charges. (4) Amortization of financing costs were $1,436, $1,274, $1,346 and $1,309 for the quarters ended December 31, 2002, September 30, 2002, June 30, 2002 and March 31, 2002, respectively. These amounts were not included in the calculation of interest coverage ratio. 6
DECEMBER 31, 2002 SEPTEMBER 30, 2002 JUNE 30, 2002 MARCH 31, 2002 ----------------- ------------------ ------------- -------------- Capitalization: Total Debt............................... $5,147,220 $5,466,692 $4,415,724 $4,361,233 Price @ Quarter End...................... $ 36.8600 $ 37.2000 $ 39.9500 $ 39.4500 Equity Value @ Quarter End............... $4,608,901 $4,651,153 $4,994,429 $4,921,821 Total Market Capitalization.............. $9,756,121 $10,117,845 $9,410,153 $9,283,054 Debt/Total Market Capitalization......... 52.76% 54.03% 46.93% 46.98% BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 CONSOLIDATED BALANCE SHEETS (IN THOUSANDS) 7
DECEMBER 31, 2002 SEPTEMBER 30, 2002 JUNE 30, 2002 MARCH 31, 2002 ----------------- ------------------ ------------- -------------- (UNAUDITED) (UNAUDITED) (UNAUDITED) (UNAUDITED) ASSETS Real estate................................ $7,781,684 $8,139,450 $6,972,779 $6,573,532 Development in progress.................... 448,576 412,981 431,288 729,889 Land held for future development........... 215,866 213,769 203,518 209,919 Real estate held for sale.................. 224,585 -- -- -- Less accumulated depreciation........ (822,933) (836,418) (795,852) (755,156) ---------- ---------- ---------- ---------- Total real estate.................... 7,847,778 7,929,782 6,811,733 6,758,184 Cash and cash equivalents.................. 55,275 28,793 81,640 93,031 Escrows.................................... 41,906 28,200 22,776 23,192 Tenant and other receivables, net.......... 20,458 48,716 31,298 36,846 Accrued rental income, net................. 165,321 156,818 146,100 133,885 Deferred charges, net...................... 176,545 148,435 148,239 127,948 Prepaid expenses and other assets.......... 18,015 38,752 16,081 30,235 Investments in unconsolidated joint ventures................................. 101,905 101,819 100,804 98,071 ---------- ---------- ---------- ---------- Total assets......................... $8,427,203 $8,481,315 $7,358,671 $7,301,392 ========== ========== ========== ========== LIABILITIES AND STOCKHOLDERS' EQUITY Liabilities: Mortgage notes and bonds payable......... $4,267,119 $4,422,692 $4,415,724 $4,361,233 Unsecured senior notes, net of discount............................... 747,375 -- -- -- Unsecured bridge loan.................... 105,683 1,000,000 -- -- Unsecured line of credit................. 27,043 44,000 -- -- Accounts payable and accrued expenses.... 73,846 69,097 52,655 56,125 Dividends and distributions payable...... 81,226 81,329 83,707 79,985 Interest rate contracts.................. 14,514 15,115 11,568 8,635 Accrued interest payable................. 25,141 18,265 17,635 15,032 Other liabilities........................ 81,085 70,292 65,142 75,465 ---------- ---------- ---------- ---------- Total liabilities.................... 5,423,032 5,720,790 4,646,431 4,596,475 ---------- ---------- ---------- ---------- Commitments and contingencies.............. -- -- -- -- ---------- ---------- ---------- ---------- Minority interests......................... 844,581 804,229 825,730 829,687 ---------- ---------- ---------- ---------- Series A Convertible Redeemable Preferred Stock, liquidation preference $50.00 per share, 0 issued and outstanding at December 31, 2002 September 30, 2002 and 2,000,000 outstanding at June 30, 2002 and March 31, 2002....................... -- -- 100,000 100,000 ---------- ---------- ---------- ---------- Stockholders' Equity: Excess stock, $.01 par value, 150,000,000 shares authorized, none issued or outstanding............................ Common stock, $.01 par value, 250,000,000 shares authorized, 95,362,990, 95,273,202, 91,545,294 and 91,137,874 issued and outstanding, respectively... 954 953 915 911 Additional paid-in capital............... 1,981,833 1,977,560 1,821,762 1,809,836 Earnings in excess of dividends/(dividends in excess of earnings).............................. 199,442 (2,532) (16,152) (15,084) Treasury common stock, at cost........... (2,722) (2,722) (2,722) (2,722) Unearned compensation.................... (2,899) (3,355) (3,598) (3,843) Accumulated other comprehensive loss..... (17,018) (13,608) (13,695) (13,868) ---------- ---------- ---------- ---------- Total stockholders' equity............. 2,159,590 1,956,296 1,786,510 1,775,230 ---------- ---------- ---------- ---------- Total liabilities and stockholders' equity............................. $8,427,203 $8,481,315 $7,358,671 $7,301,392 ========== ========== ========== ========== BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 CONSOLIDATED INCOME STATEMENTS (IN THOUSANDS, EXCEPT FOR PER SHARE AMOUNTS) (UNAUDITED) (1) Base Rent is reported on a straight-line basis over the terms of the respective leases. The impact of the straight-line rent adjustment increased revenue by $11,938, $12,244, $12,216 and $14,784 for the three months ended December 31, 2002, September 30, 2002, June 30, 2002 and March 31, 2002, respectively. (2) Includes hotel lease payments of $8,023 and $4,322 for the three months ended June 30, 2002 and March 31, 2002, respectively. (3) Includes a refund of $1,300 related to prior years' tax matter for the three months ended June 30, 2002. (4) Includes hotel expenses of $1,844 and $1,327 for the three months ended June 30, 2002 and March 31, 2002, respectively. (5) Includes a $2.8 million write-off of leasing costs related to the termination of the lease with Arthur Andersen for the three months ended June 30, 2002. (6) Interest expense is reported net of capitalized interest of $4,719, $4,684, $5,261 and $7,847 for the three months ended December 31, 2002, September 30, 2002, June 30, 2002 and March 31, 2002, respectively. (7) Equals minority interest percent of 17.69%, 17.76%, 18.37% and 18.28%, respectively of income before minority interest in Operating Partnership after deduction for preferred dividends and distributions for the three months ended December 31, 2002, September 30, 2002, June 30, 2002 and March 31, 2002, respectively. (8) Certain prior period amounts have been reclassified to conform to current period presentation. 8
THREE MONTHS ENDED ---------------------------------------------- 31-DEC-02 30-SEP-02 30-JUN-02 31-MAR-02 --------- --------- --------- ---------- Revenue: Rental Base Rent (1) (2)....................................... $265,559 $241,254 $242,630 $228,939 Recoveries from tenants................................. 38,929 35,544 36,487 33,615 Parking and other....................................... 13,217 13,056 12,458 12,096 -------- -------- -------- -------- Total rental revenue.................................. 317,705 289,854 291,575 274,650 Hotel revenues............................................ 24,779 20,007 -- -- Development and management services....................... 2,769 2,571 1,710 3,698 Interest and other (3).................................... 700 1,222 2,310 1,272 -------- -------- -------- -------- Total revenue......................................... 345,953 313,654 295,595 279,620 -------- -------- -------- -------- Expenses: Operating (4)............................................. 61,428 63,946 57,845 56,584 Taxes..................................................... 41,298 35,629 34,802 33,958 Hotel operating........................................... 17,562 13,524 -- -- General and administrative (5)............................ 12,703 9,956 13,564 11,069 Interest (6).............................................. 72,146 68,425 67,327 63,787 Depreciation and amortization............................. 53,957 45,514 43,779 42,927 Net derivative losses (SFAS No.133)....................... 1,461 5,284 4,826 303 Loss on investments in other companies.................... -- -- -- 4,297 -------- -------- -------- -------- Total expenses........................................ 260,555 242,278 222,143 212,925 -------- -------- -------- -------- Income before minority interests and income from unconsolidated joint ventures............................. 85,398 71,376 73,452 66,695 Minority interest in property partnerships.................. 162 720 712 471 Income from unconsolidated joint ventures................... 2,083 2,530 1,659 1,682 -------- -------- -------- -------- Income before minority interest in Operating Partnership.... 87,643 74,626 75,823 68,848 Minority interest in Operating Partnership (7).............. (20,867) (18,688) (19,555) (18,361) -------- -------- -------- -------- Income before gain on sales, net of minority interest....... 66,776 55,938 56,268 50,487 Gain on sales of real estate, net........................... 187,562 -- -- -- -------- -------- -------- -------- Income before gain on sales of land held for development.... 254,338 55,938 56,268 50,487 Gain on sales of land held for development, net............. -- 3,644 -- -- -------- -------- -------- -------- Income before discontinued operations....................... 254,338 59,582 56,268 50,487 Income from discontinued operations, net of minority interest.................................................. 127 175 150 681 Gain on sales of real estate from discontinued operations, net of minority interest.................................. 7,645 11,910 -- 5,840 -------- -------- -------- -------- Income before extraordinary items and preferred dividend.... 262,110 71,667 56,418 57,008 Extraordinary items......................................... (1,964) -- -- -- -------- -------- -------- -------- Income before preferred dividend............................ 260,146 71,667 56,418 57,008 Preferred dividend.......................................... -- (126) (1,643) (1,643) -------- -------- -------- -------- Net income available to common shareholders................. $260,146 $ 71,541 $ 54,775 $ 55,365 ======== ======== ======== ======== INCOME PER SHARE OF COMMON STOCK (EPS) Net income available to common shareholders per share -- basic................................................... $ 2.73 $ 0.75 $ 0.60 $ 0.61 ======== ======== ======== ======== Net income available to common shareholders per share -- diluted................................................. $ 2.70 $ 0.74 $ 0.59 $ 0.60 ======== ======== ======== ======== BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 FUNDS FROM OPERATIONS (IN THOUSANDS, EXCEPT FOR PER SHARE AMOUNTS) (UNAUDITED) RECONCILIATION TO DILUTED FUNDS FROM OPERATIONS
THREE MONTHS ENDED ---------------------------------------------- 31-DEC-02 30-SEP-02 30-JUN-02 31-MAR-02 --------- --------- --------- ---------- Income from operations before net derivative losses (SFAS No.133), minority interests and income from unconsolidated joint ventures............................................ $ 85,398 $ 71,376 $ 73,452 $ 66,695 Add: Real estate depreciation and amortization (1)........... 56,072 46,971 45,032 44,499 Income from discontinued operations..................... 154 213 184 833 Income from unconsolidated joint ventures............... 2,083 2,530 1,659 1,682 Less: Minority property partnership's share of funds from operations............................................ 1,390 521 593 719 Preferred dividends and distributions................... 5,926 6,162 8,223 8,400 -------- -------- -------- -------- Funds from operations (FFO)................................. 136,391 114,407 111,511 104,590 Add (subtract): Net derivative losses (SFAS No.133)..................... 1,461 5,284 4,826 303 Early surrender lease payments received -- contractual basis................................................. -- 667 3,926 3,927 FFO before net derivative losses (SFAS No.133) and after early surrender lease payments received................... $137,852 $120,358 $120,263 $108,820 -------- -------- -------- -------- FFO available to common shareholders before net derivative losses (SFAS No. 133) and after early surrender lease payments received (3)..................................... $113,464 $ 98,980 $ 98,165 $ 88,929 ======== ======== ======== ======== FFO per share before net derivative losses (SFAS No.133) and after cash basis early surrender lease income -- basic.... $ 1.19 $ 1.04 $ 1.07 $ 0.98 ======== ======== ======== ======== Weighted average shares outstanding -- basic................ 95,313 94,904 91,357 90,932 ======== ======== ======== ======== FFO per share before net derivative losses (SFAS No.133) and after early surrender lease payments received -- diluted................................................... $ 1.14 $ 1.00 $ 1.02 $ 0.93 ======== ======== ======== ======== FFO per share after net derivative losses (SFAS No.133) and before early surrender lease payments received -- diluted................................................... $ 1.13 $ 0.95 $ 0.95 $ 0.90 ======== ======== ======== ======== Weighted average shares outstanding -- diluted.............. 105,631 105,725 105,982 105,768 ======== ======== ======== ======== (1) Real estate depreciation includes the Company's share of joint venture real estate depreciation of $2,848, $2,170, $1,947 and $2,187 less corporate related depreciation of $733, $733, $711 and $632 for the three months ended December 31, 2002, September 30, 2002, June 30, 2002 and March 31, 2002, respectively. (2) Based on weighted average shares for the quarter. Company's share for the quarter ended December 31, 2002, September 30, 2002, June 30, 2002 and March 31, 2002 was 82.31%, 82.24%, 81.63% and 81.72%, respectively. (3) Based on weighted average diluted shares for the quarter. Company's share for the quarter ended December 31, 2002, September 30, 2002, June 30, 2002 and March 31, 2002 was 83.76%, 83.76%, 83.75% and 83.87%, respectively. 9
DECEMBER 31, 2002 SEPTEMBER 30, 2002 JUNE 30, 2002 ------------------------------- ------------------------------- ------------------------------- INCOME SHARES INCOME SHARES INCOME SHARES (NUMERATOR) (DENOMINATOR) (NUMERATOR) (DENOMINATOR) (NUMERATOR) (DENOMINATOR) ------------- --------------- ------------- --------------- ------------- --------------- Basic FFO before net derivative losses (SFAS No.133) and after early surrender lease income............. $137,852 115,800 $120,358 115,402 $120,263 111,923 Effect of Dilutive Securities Convertible Preferred Units............ 5,926 9,236 6,036 9,344 6,580 10,342 Convertible Preferred Stock............ -- -- 126 200 1,643 2,625 Stock Options and other............ -- 1,082 -- 1,276 -- 1,659 -------- ------- -------- ------- -------- ------- Diluted FFO before net derivative losses (SFAS No.133) and after early surrender lease payments received........... $143,778 126,118 $126,520 126,222 $128,486 126,549 ======== ======= ======== ======= ======== ======= Company's share of diluted FFO before net derivative losses (SFAS 133) and after early surrender lease payments received (2)................ $120,422 105,631 $105,974 105,725 $107,605 105,982 ======== ======= ======== ======= ======== ======= FFO per share before net derivative losses (SFAS No.133) and after early surrender lease payments received -- basic.............. $ 1.19 $ 1.04 $ 1.07 ======== ======== ======== FFO per share before net derivative losses (SFAS No.133) and after early surrender lease payments received -- diluted............ $ 1.14 $ 1.00 $ 1.02 ======== ======== ======== MARCH 31, 2002 ------------------------------- INCOME SHARES (NUMERATOR) (DENOMINATOR) ------------- --------------- Basic FFO before net derivative losses (SFAS No.133) and after early surrender lease income............. $108,820 111,272 Effect of Dilutive Securities Convertible Preferred Units............ 6,757 10,823 Convertible Preferred Stock............ 1,643 2,625 Stock Options and other............ -- 1,387 -------- ------- Diluted FFO before net derivative losses (SFAS No.133) and after early surrender lease payments received........... $117,220 126,107 ======== ======= Company's share of diluted FFO before net derivative losses (SFAS 133) and after early surrender lease payments received (2)................ $ 98,314 105,768 ======== ======= FFO per share before net derivative losses (SFAS No.133) and after early surrender lease payments received -- basic.............. $ 0.98 ======== FFO per share before net derivative losses (SFAS No.133) and after early surrender lease payments received -- diluted............ $ 0.93 ======== BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 CAPITAL STRUCTURE DEBT (IN THOUSANDS) (1) Includes $146.9 million drawn on the unsecured line of credit that is secured by 875 Third Avenue. (2) Does not include joint venture debt outstanding. See page 15 for detailed joint venture information. EQUITY (IN THOUSANDS)
AGGREGATE PRINCIPAL DECEMBER 31, 2002 ------------------- Mortgage Notes and Bonds Payable(1)......................... $4,267,119 Unsecured Senior Notes, net of discount..................... 747,375 Unsecured Bridge Loan....................................... 105,683 Unsecured Line of Credit.................................... 27,043 ---------- Total Debt (2).............................................. $5,147,220 ========== (1) Value based on December 31, 2002 closing price of $36.86 10
COMMON SHARES & UNITS STOCK OUTSTANDING EQUIVALENTS EQUIVALENT (1) -------------- ----------- -------------- Common Stock................................................ 95,363 95,363 $3,515,080 Operating Partnership Units................................. 20,474 20,474 754,672 Preferred Operating Partnership Units Series One................................................ 2,378 2,114 77,922 Series Two................................................ 5,401 7,087 261,227 ---------- ---------- Total Equity................................................ 125,038 $4,608,901 ========== ========== Total Market Capitalization................................. $9,756,121 ========== BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 DEBT ANALYSIS DEBT MATURITIES AND PRINCIPAL PAYMENTS (IN THOUSANDS) UNSECURED DEBT UNSECURED LINE OF CREDIT -- MATURES MARCH 31, 2003 (1) (IN THOUSANDS)
2003 2004 2005 2006 2007 THEREAFTER TOTAL ---------- -------- -------- -------- -------- ---------- ---------- Amount......................................... $1,064,222 $411,855 $285,387 $284,458 $182,632 $2,918,666 $5,147,220 Weighted Average Rate.......................... 3.38% 4.43% 6.93% 7.79% 6.59% 6.92% 6.03% (1) The maturity date has been extended to Janury 17, 2006. (2) $146.9 million drawn on the unsecured line of credit is secured by 875 Third Avenue. UNSECURED BRIDGE LOAN -- MATURES SEPTEMBER 2003 (IN THOUSANDS) OUTSTANDING @12/31/02 --------------------- $105,683 UNSECURED SENIOR NOTES, NET -- MATURE JANUARY 15, 2013 (IN THOUSANDS) OUTSTANDING @12/31/02 --------------------- $747,375 UNSECURED AND SECURED DEBT ANALYSIS
OUTSTANDING LETTERS OF REMAINING FACILITY @12/31/02 CREDIT CAPACITY - --------------------- ----------- ---------- ---------- 605,00$0....... $27,043 $1,854 $429,201(2) FLOATING AND FIXED RATE DEBT ANALYSIS
WEIGHTED WEIGHTED AVERAGE % OF DEBT AVERAGE RATE MATURITY --------- ------------ ---------------- Unsecured Debt.............................................. 17.10% 5.72% 8.6 years Secured Debt................................................ 82.90% 6.09% 4.7 years ------ ---- --------- Total Debt.................................................. 100.00% 6.03% 5.4 years ====== ==== ========= 11
WEIGHTED WEIGHTED AVERAGE % OF DEBT AVERAGE RATE MATURITY --------- ------------ ---------------- Floating Rate Debt.......................................... 24.42% 3.04% 0.7 years Fixed Rate Debt............................................. 75.58% 7.17% 6.2 years ------ ---- --------- Total Debt.................................................. 100.00% 6.03% 5.4 years ====== ==== ========= BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 SENIOR UNSECURED DEBT COVENANT COMPLIANCE RATIOS (IN THOUSANDS)
DECEMBER 31, 2002 ----------------- Capitalized Property Value.................................. $10,597,030 Cash and Cash Equivalents................................... 55,275 Undeveloped Land, at Cost................................... 215,866 Development in Process, at Cost (including Joint Venture %)................................................ 501,431 ----------- Total Assets................................................ $11,369,602 =========== Unencumbered Assets......................................... $ 2,813,601 ----------- Secured Debt (Fixed and Variable) (1)....................... $ 4,261,315 Joint Venture Debt.......................................... 236,807 Contingent Liabilities & Letters of Credit.................. 41,679 Unsecured Debt (2).......................................... 882,726 ----------- Total Outstanding Debt...................................... $ 5,422,527 =========== Consolidated EBITDA......................................... $ 216,853 ----------- Interest Expense............................................ $ 72,204 ----------- - ---------------------------------------- (1) Excludes Fair Value Adjustment of $5.8 million. (2) Excludes Debt Discount of $2.6 million. 12
COVENANT RATIOS TEST ACTUAL - --------------- ------------------ -------- Total Outstanding Debt/Total Assets......................... Less than 60% 47.7% Secured Debt/Total Assets................................... Less than 50% 39.6% Interest Coverage (Annualized Consolidated EBITDA to Greater than 1.50x Annualized Interest Expense).............................. 3.00 Unencumbered Assets/Unsecured Debt.......................... Greater than 150% 318.7% ------- Unencumbered GAAP NOI....................................... $54,389 ------- % of unencumbered NOI to Total NOI.......................... 25.1% ------- # of unencumbered properties................................ 57 ------- BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 DEBT MATURITIES AND PRINCIPAL PAYMENTS (IN THOUSANDS) - ---------------------------------------- (1) Secured by draw on unsecured line of credit. Maturity date extended to Januray 17, 2006 subsequest to December 31, 2002. 13
PROPERTY 2003 2004 2005 2006 2007 THEREAFTER TOTAL - -------- -------- -------- -------- -------- -------- ---------- -------- Citigroup Center................................... $ 5,763 $ 6,191 $ 6,651 $ 7,145 $ 7,676 $483,253 $516,679 5 Times Square 372,905 -- -- -- -- -- 372,905 Embarcadero Center One, Two and Federal Reserve.... 4,498 4,809 5,141 5,496 5,877 278,913 304,734 Prudential Center.................................. 4,299 4,591 4,919 5,256 5,619 259,705 284,389 280 Park Avenue.................................... 2,800 3,022 3,261 3,519 3,798 248,794 265,194 599 Lexington Avenue............................... -- -- 225,000 -- -- -- 225,000 Times Square Tower................................. -- 222,196 -- -- -- -- 222,196 111 Huntington Avenue.............................. 203,000 -- -- -- -- -- 203,000 Embarcadero Center Four............................ 3,315 3,544 3,797 4,061 4,346 129,711 148,774 875 Third Avenue (1)............................... 146,902 -- -- -- -- -- 146,902 Embarcadero Center Three........................... 2,206 2,351 2,506 2,671 132,726 -- 142,460 Riverfront Plaza................................... 2,720 2,905 3,104 3,314 3,540 95,327 110,910 Democracy Center................................... 1,828 1,961 2,103 2,257 2,421 93,728 104,298 Embarcadero Center West Tower...................... 1,449 1,546 1,649 90,415 -- -- 95,059 100 East Pratt Street.............................. 1,836 1,964 2,100 2,246 2,401 78,105 88,652 601 and 651 Gateway Boulevard...................... 826 899 977 1,062 1,155 83,566 88,485 Reservoir Place.................................... 2,859 3,061 3,279 60,065 -- -- 69,264 One & Two Reston Overlook.......................... 818 65,908 -- -- -- -- 66,726 2300 N Street...................................... 66,000 -- -- -- -- -- 66,000 202, 206 & 214 Carnegie Center..................... 610 663 719 780 845 58,217 61,834 New Dominion Technology Park, Building One......... 102 91 654 1,282 1,378 54,042 57,549 Capital Gallery.................................... 1,293 1,404 1,524 50,651 -- -- 54,872 504, 506 & 508 Carnegie Center..................... 979 1,052 1,136 1,221 1,314 40,915 46,617 Waltham Weston Corporate Center.................... -- 44,840 -- -- -- -- 44,840 BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 DEBT MATURITIES AND PRINCIPAL PAYMENTS (IN THOUSANDS) - ---------------------------------------- (1) Outstanding balances were repaid in full on January 17, 2003 with proceeds from the offering of the $175 million senior unsecured notes and cash. (2) Maturity date extended to January 17, 2006 subsequent to December 31, 2002. 14
PROPERTY 2003 2004 2005 2006 2007 THEREAFTER TOTAL - -------- ---------- -------- -------- -------- -------- ---------- ---------- 10 & 20 Burlington Mall Rd & 91 Hartwell....... 589 688 741 795 855 35,589 39,257 10 Cambridge Center............................ 514 607 659 715 777 31,436 34,708 1301 New York Avenue........................... 1,217 1,315 1,417 1,531 1,651 23,409 30,540 2600 Tower Oaks Boulevard...................... -- 30,218 -- -- -- -- 30,218 Sumner Square.................................. 481 518 557 599 645 26,936 29,736 Quorum Office Park............................. 28,818(1) -- -- -- -- -- 28,818 Eight Cambridge Center......................... 495 557 601 649 702 24,486 27,490 510 Carnegie Center............................ 547 588 635 683 735 23,519 26,707 Lockheed Martin Building....................... 601 641 685 732 782 21,799 25,240 University Place............................... 655 702 752 806 864 20,338 24,117 Reston Corporate Center........................ 574 612 654 698 745 20,523 23,806 Orbital Sciences -- Phase II................... 23,611(1) -- -- -- -- -- 23,611 191 & 201 Spring Street........................ 376 443 482 20,773 -- -- 22,074 Shaws Supermarket.............................. 20,717 -- -- -- -- -- 20,717 NIMA Building.................................. 497 530 566 604 644 17,785 20,626 Bedford Business Park.......................... 583 690 751 818 890 16,859 20,591 40 Shattuck Road............................... 15,939 -- -- -- -- -- 15,939 101 Carnegie Center............................ 348 375 406 6,622 -- -- 7,751 302 Carnegie Center............................ 7,594(1) -- -- -- -- -- 7,594 New Dominion Technology Park, Bldg. 2.......... -- -- 7,558 -- -- -- 7,558 Montvale Center................................ 160 173 189 6,762 -- -- 7,284 Hilltop Business Center........................ 172 200 214 230 246 4,336 5,398 ---------- -------- -------- -------- -------- ---------- ---------- 931,496 411,855 285,387 284,458 182,632 2,171,291 4,267,119 ---------- -------- -------- -------- -------- ---------- ---------- Unsecured Senior Notes......................... -- -- -- -- -- 747,375 747,375 Unsecured Line of Credit....................... 27,043(1)(2) -- -- -- -- -- 27,043 Unsecured Bridge Loan.......................... 105,683(1) -- -- -- -- -- 105,683 ---------- -------- -------- -------- -------- ---------- ---------- $1,064,222 $411,855 $285,387 $284,458 $182,632 $2,918,666 $5,147,220 ========== ======== ======== ======== ======== ========== ========== BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 UNCONSOLIDATED JOINT VENTURES MISCELLANEOUS BALANCE SHEET INFORMATION (unaudited and in thousands) as of December 31, 2002 RESULTS OF OPERATIONS for the three months ended December 31, 2002
ONE MARKET 140 265 TWO 901 FREEDOM SQUARE METROPOLITAN KENDRICK FRANKLIN DISCOVERY FREEDOM NEW YORK SQUARE NORTH SQUARE STREET STREET SQUARE SQUARE (2) AVENUE (2) -------- -------- ------------ -------- -------- --------- ---------- ---------- Total Equity (1)................... $ 387 $13,261 $31,662 $ 5,450 $22,216 $ 7,376 $ 8,095 $13,458 ======= ======= ======= ======= ======= ======= ======= ======= Mortgage/Construction loans payable (1).............................. $18,940 $48,637 $69,827 $14,061 $18,897 $30,949 $32,853 $ 2,643 ======= ======= ======= ======= ======= ======= ======= ======= BXP's nominal ownership percentage....................... 25.00% 50.00% 51.00% 25.00% 35.00% 50.00% 50.00% 25.00% ======= ======= ======= ======= ======= ======= ======= ======= COMBINED --------- Total Equity (1)................... $101,905 ======== Mortgage/Construction loans payable (1).............................. $236,807 ======== BXP's nominal ownership percentage....................... - ---------------------------------------- (1) Represents the Company's share. (2) Property is currently under development. (3) The impact of the straight-line rent adjustment increased revenue by $2,194 for the three months ended December 31, 2002. (4) Reflects the changes in the allocation percentages pursuant to the achievement of specified investment return thresholds as provided for in the joint venture agreements. 15
ONE ONE MARKET 140 265 TWO 901 FREEDOM FREEDOM SQUARE METROPOLITAN KENDRICK FRANKLIN DISCOVERY FREEDOM NEW YORK SQUARE SQUARE NORTH SQUARE STREET STREET SQUARE SQUARE (2) AVENUE (2) - ----------------------------------- -------- -------- ------------ -------- -------- --------- ---------- ---------- REVENUE Total revenue...................... $3,596 $ 5,017 $ 6,162 $ 2,800 $ 3,500 $ 2,638 $ 2,318 $ -- ------ ------- ------- ------- ------- ------- ------- ------- EXPENSES Operating.......................... 884 1,514 1,950 511 1,211 434 679 -- ------ ------- ------- ------- ------- ------- ------- ------- NET OPERATING INCOME............... 2,712 3,503 4,212 2,289 2,289 2,204 1,639 -- Interest........................... 1,475 1,888 2,844 1,062 409 510 286 -- Depreciation and amortization...... 747 1,318 1,203 352 757 437 483 -- ------ ------- ------- ------- ------- ------- ------- ------- NET INCOME......................... $ 490 $ 297 $ 165 $ 875 $ 1,123 $ 1,257 $ 870 $ -- ====== ======= ======= ======= ======= ======= ======= ======= BXP's share of net income.......... $ 123 $ 149 $ 84 $ 271(4) $ 393 $ 628 $ 435 $ -- ====== ======= ======= ======= ======= ======= ======= ======= BXP's share of Funds from Operations....................... $ 619(4) $ 808 $ 698 $ 613(4) $ 658 $ 847 $ 676 $ -- ====== ======= ======= ======= ======= ======= ======= ======= ONE FREEDOM SQUARE COMBINED - ----------------------------------- --------- REVENUE Total revenue...................... $ 26,031(3) -------- EXPENSES Operating.......................... 7,183 -------- NET OPERATING INCOME............... 18,848 Interest........................... 8,474 Depreciation and amortization...... 5,297 -------- NET INCOME......................... $ 5,077 ======== BXP's share of net income.......... $ 2,083 ======== BXP's share of Funds from Operations....................... $ 4,919 ======== BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 UNCONSOLIDATED JOINT VENTURE DEBT ANALYSIS (*) DEBT MATURITIES AND PRINCIPAL PAYMENTS (IN THOUSANDS) FLOATING AND FIXED RATE DEBT ANALYSIS
2003 2004 2005 2006 2007 THEREAFTER TOTAL -------- -------- -------- -------- -------- ---------- -------- Amount............................................. $51,696 $34,855 $4,807 $2,342 $2,534 $140,573 $236,807 Weighted Average Rate.............................. 3.09% 3.51% 5.25% 7.89% 7.90% 7.94% 6.17% DEBT MATURITIES AND PRINCIPAL PAYMENTS BY PROPERTY (IN THOUSANDS)
WEIGHTED WEIGHTED AVERAGE AVERAGE % OF DEBT RATE MATURITY --------- -------- --------- Floating Rate Debt.......................................... 36.04% 3.04% 1.2 years Fixed Rate Debt............................................. 63.96% 7.93% 8.1 years ------ ---- --------- Total Debt.................................................. 100.00% 6.17% 5.6 years ====== ==== ========= - ---------------------------------------- (*) All amounts represent the Company's share. (1) Boston Properties has a 51% interest in this property. (2) Boston Properties has a 50% interest in this property. (3) Boston Properties has a 25% interest in this property. (4) Boston Properties has a 35% interest in this property. 16
PROPERTY 2003 2004 2005 2006 2007 THEREAFTER TOTAL - -------- -------- -------- -------- -------- -------- ---------- -------- Metropolitan Square (1)............................ $ 704 $ 764 $ 830 $ 901 $ 978 $ 65,650 $ 69,827 Market Square North (2)............................ 795 860 926 1,001 1,080 43,975 48,637 Two Freedom Square (2)............................. -- 32,853 -- -- -- -- 32,853 Discovery Square (2)............................... 30,949 -- -- -- -- -- 30,949 One Freedom Square (3)............................. 205 221 239 258 279 17,738 18,940 265 Franklin Street (4)............................ 18,897 -- -- -- -- -- 18,897 140 Kendrick Street (3)............................ 146 157 169 182 197 13,210 14,061 901 New York Avenue (3)............................ -- -- 2,643 -- -- -- 2,643 ------- ------- ------ ------ ------ -------- -------- $51,696 $34,855 $4,807 $2,342 $2,534 $140,573 $236,807 ======= ======= ====== ====== ====== ======== ======== BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 PORTFOLIO OVERVIEW--SQUARE FOOTAGE RENTABLE SQUARE FEET OF IN-SERVICE PROPERTIES BY LOCATION AND TYPE OF PROPERTY HOTEL PROPERTIES
GEOGRAPHIC AREA OFFICE (1) OFFICE/TECHNICAL INDUSTRIAL TOTAL % OF TOTAL - --------------- ---------- ---------------- ---------- ---------- ---------- Greater Boston............................................. 7,463,442(2) 545,206 152,009 8,160,657 25.54% Greater Washington......................................... 6,116,483(3) 971,045 -- 7,087,528 22.18% Greater San Francisco...................................... 4,701,539 144,366 60,000 4,905,905 15.35% Midtown Manhattan.......................................... 7,255,976 -- -- 7,255,976 22.71% Princeton/East Brunswick, NJ............................... 2,308,181 -- -- 2,308,181 7.22% Baltimore, MD.............................................. 1,176,029 -- -- 1,176,029 3.68% Richmond, VA............................................... 899,586 -- -- 899,586 2.82% Bucks County, PA........................................... -- -- 161,000 161,000 0.50% ---------- --------- ------- ---------- ------ 29,921,236 1,660,617 373,009 31,954,862 100.00% ========== ========= ======= ========== ====== % of Total................................................. 93.64% 5.20% 1.17% 100.00% STRUCTURED PARKING
HOTEL PROPERTIES - ------------------------------------------------------------------------ NUMBER OF SQUARE ROOMS FEET ---------- -------- Long Wharf Marriott, Boston, MA............................. 402 420,000 Cambridge Center Marriott, Cambridge, MA.................... 431 330,400 Residence Inn by Marriott, Cambridge, MA.................... 221 187,474 ----- ------- Total Hotel Properties...................................... 1,054 937,874 ===== ======= - ---------------------------------------- (1) Includes retail square footage of approximately 1,200,000. (2) Includes 343,913 square feet at 265 Franklin Street which is 35% owned by Boston Properties and 380,987 square feet at 140 Kendrick Street which is 25% owned by Boston Properties. (3) Includes 410,308 square feet at One Freedom Square which is 25% owned by Boston Properties, 587,217 square feet at Metropolitan Square which is 51% owned by Boston Properties, 401,279 square feet at Market Square North which is 50% owned by Boston Properties and 181,019 square feet at Discovery Square which is 50% owned by Boston Properties. 17
NUMBER OF SQUARE SPACES FEET ---------- --------- Total Structured Parking.................................... 20,710 6,719,991 ====== ========= BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 IN-SERVICE PROPERTY LISTING AS OF DECEMBER 31, 2002 - ---------------------------------------- (1) Not included in same property analysis (2) 93,935 square feet of space added in Q2 2002 is not included in the same property analysis. (3) Amount repaid on January 17, 2003 with proceeds from the offering of the $175 million senior unsecured notes. 18
ANNUALIZED REVENUE NUMBER OF PER ENCUMBERED GREATER BOSTON SUB MARKET BUILDINGS SQUARE FEET OCCUPIED % OCCUPIED SF (Y/N) - -------------- --------------------------- ---------- ----------- ----------- ------------ ----------- Office 800 Boylston Street -- The Prudential Center........... CBD Boston MA 1 1,175,218 92.2% $37.75 Y (1)111 Huntington Avenue -- The Prudential Center....... CBD Boston MA 1 854,129 98.2% 45.62 Y 101 Huntington Avenue -- The Prudential Center........... CBD Boston MA 1 510,983 80.9% 40.40 Y (2)The Shops at the Prudential Center...................... CBD Boston MA 1 557,946 97.6% 45.78 Y 265 Franklin Street (35% ownership).................. CBD Boston MA 1 343,913 67.9% 55.52 Y One Cambridge Center.......... East Cambridge MA 1 215,385 94.0% 44.24 N Three Cambridge Center........ East Cambridge MA 1 107,484 100.0% 28.80 N Eight Cambridge Center........ East Cambridge MA 1 177,226 100.0% 30.96 Y Ten Cambridge Center.......... East Cambridge MA 1 152,664 100.0% 34.32 Y Eleven Cambridge Center....... East Cambridge MA 1 79,616 100.0% 41.87 N University Place.............. Mid-Cambridge MA 1 195,282 100.0% 34.65 Y Reservoir Place............... Route 128 Mass Turnpike MA 1 522,760 84.7% 35.43 Y 204 Second Avenue............. Route 128 Mass Turnpike MA 1 40,974 100.0% 27.56 N 140 Kendrick Street (25% ownership).................. Route 128 Mass Turnpike MA 3 380,987 100.0% 27.95 Y 170 Tracer Lane............... Route 128 Mass Turnpike MA 1 73,258 55.0% 34.57 N Waltham Office Center......... Route 128 Mass Turnpike MA 3 130,209 84.8% 29.67 N 195 West Street............... Route 128 Mass Turnpike MA 1 63,500 100.0% 46.35 N 200 West Street............... Route 128 Mass Turnpike MA 1 248,048 100.0% 34.74 N 10 & 20 Burlington Mall Road Route 128 Northwest MA 2 156,416 88.7% 28.48 Y Bedford Business Park......... Route 128 Northwest MA 1 90,000 100.0% 20.59 Y 32 Hartwell Avenue............ Route 128 Northwest MA 1 69,154 100.0% 28.88 N 91 Hartwell Avenue............ Route 128 Northwest MA 1 121,215 91.3% 34.26 Y 92 Hayden Avenue.............. Route 128 Northwest MA 1 31,100 100.0% 51.71 N 100 Hayden Avenue............. Route 128 Northwest MA 1 55,924 100.0% 32.90 N 33 Hayden Avenue.............. Route 128 Northwest MA 1 75,216 100.0% 38.58 N Lexington Office Park......... Route 128 Northwest MA 2 167,293 78.6% 30.12 N 191 Spring Street............. Route 128 Northwest MA 1 162,700 100.0% 30.79 Y 181 Spring Street............. Route 128 Northwest MA 1 53,595 41.2% 34.91 Y 201 Spring Street............. Route 128 Northwest MA 1 102,500 100.0% 32.33 Y 40 Shattuck Road.............. Route 128 Northwest MA 1 120,000 92.2% 25.87 Y Quorum Office Park............ Route 128 Northwest MA 2 259,918 100.0% 17.61 Y(3) Newport Office Park........... Route 128 South MA 1 168,829 44.6% 25.10 N -- --------- ----- ------ 39 7,463,442 91.0% $36.91 -- --------- ----- ------ Office/Technical Fourteen Cambridge Center..... East Cambridge MA 0 67,362 100.0% 21.78 N Bedford Business Park......... Route 128 Northwest MA 2 383,704 100.0% 14.87 Y 17 Hartwell Avenue............ Route 128 Northwest MA 1 30,000 100.0% 11.00 N 164 Lexington Road............ Route 128 Northwest MA 1 64,140 100.0% 10.27 N -- --------- ----- ------ 5 545,206 100.0% $14.97 -- --------- ----- ------ Industrial 40-46 Harvard Street.......... Route 128 Southwest MA 0 152,009 100.0% $7.65 N -- --------- ----- ------ Total Greater Boston: 45 8,160,657 91.8% $34.72 == ========= ===== ====== BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 IN-SERVICE PROPERTY LISTING AS OF DECEMBER 31, 2002 - ---------------------------------------- (1) Not included in same property analysis (2) One of three buildings totaling 160,502 square feet is not included in the same property analysis (3) Amount repaid on January 17, 2003 with proceeds from the offering of the $175 million senior unsecured notes. 19
ANNUALIZED REVENUE NUMBER OF PER ENCUMBERED GREATER WASHINGTON, DC SUB MARKET BUILDINGS SQUARE FEET OCCUPIED % OCCUPIED SF (Y/N) - ---------------------- ------------------------ ---------- ----------- ----------- ------------ ----------- Office 2300 N Street.................... West End Washington DC 1 289,243 98.8% $54.81 Y Capital Gallery.................. Southwest Washington DC 1 396,894 100.0% 36.77 Y 500 E Street, N. W. ............. Southwest Washington DC 1 242,769 100.0% 32.55 N Metropolitan Square (51% ownership)..................... East End Washington DC 1 585,220 97.6% 38.46 Y 1301 New York Avenue............. East End Washington DC 1 188,358 100.0% 30.34 Y Market Square North (50% ownership)..................... East End Washington DC 1 401,279 100.0% 44.53 Y Sumner Square.................... CBD Washington DC 1 207,620 100.0% 34.59 Y Decoverly Two.................... Montgomery County MD 1 77,747 100.0% 24.14 N Decoverly Three.................. Montgomery County MD 1 77,040 100.0% 25.66 N Democracy Center................. Montgomery County MD 3 680,854 94.0% 28.86 Y Montvale Center.................. Montgomery County MD 1 120,823 84.2% 23.70 Y 2600 Tower Oaks Boulevard Montgomery County MD 1 178,887 100.0% 32.01 Y (2)Orbital Sciences 1&3.......... Loudoun County 2 176,726 100.0% 23.59 N Orbital Sciences 2............... Loudoun County 1 160,502 100.0% 22.84 Y(3) The Arboretum.................... Fairfax County VA 1 95,584 0 25.71 N One Freedom Square (25% ownership)..................... Fairfax County VA 1 410,308 100.0% 33.61 Y One Reston Overlook.............. Fairfax County VA 1 312,685 100.0% 22.15 Y Two Reston Overlook.............. Fairfax County VA 1 131,594 82.2% 32.07 Y (1)One Discovery Square (50% ownership)..................... Fairfax County VA 1 181,019 100.0% 36.31 Y (1)Two Discovery Square (50% ownership)..................... Fairfax County VA 1 185,970 81.9% 32.10 Y New Dominion Technology Park..... Fairfax County VA 1 235,201 100.0% 26.80 Y Reston Corporate Center.......... Fairfax County VA 2 261,046 100.0% 31.09 Y Lockheed Martin Building......... Fairfax County VA 1 255,244 100.0% 29.63 Y NIMA Building.................... Fairfax County VA 1 263,870 100.0% 45.57 Y -- --------- ----- ------ 28 6,116,483 97.8% $33.61 -- --------- ----- ------ Office/Technical (1)Broad Run Business Park....... Loudoun County 1 127,226 54.7% 23.00 N Sugarland Business Park, Building One............................ Fairfax County VA 1 52,797 22.8% 21.99 N Sugarland Business Park, Building Two............................ Fairfax County VA 1 59,215 65.9% 20.09 N 7435 Boston Boulevard............ Fairfax County VA 1 103,557 82.3% 14.89 N 7451 Boston Boulevard............ Fairfax County VA 1 47,001 66.1% 15.39 N 7450 Boston Boulevard............ Fairfax County VA 1 62,402 100.0% 20.48 N 7374 Boston Boulevard............ Fairfax County VA 1 57,321 100.0% 13.59 N 8000 Grainger Court.............. Fairfax County VA 1 90,645 100.0% 14.82 N 7500 Boston Boulevard............ Fairfax County VA 1 79,971 100.0% 14.60 N 7501 Boston Boulevard............ Fairfax County VA 1 75,756 100.0% 23.31 N 7601 Boston Boulevard............ Fairfax County VA 1 103,750 100.0% 14.23 N 7375 Boston Boulevard............ Fairfax County VA 1 26,865 100.0% 17.52 N 8000 Corporate Court............. Fairfax County VA 1 52,539 100.0% 10.03 N (1)7300 Boston Boulevard......... Fairfax County VA 1 32,000 100.0% 20.25 -- --------- ----- ------ N 14 971,045 84.3% $16.93 -- --------- ----- ------ Total Greater Washington: 42 7,087,528 95.9% $31.60 == ========= ===== ====== BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 IN-SERVICE PROPERTY LISTING AS OF DECEMBER 31, 2002 - ---------------------------------------- (1) Not included in same property analysis (2) Amount repaid on January 17, 2003 with proceeds from the offering of the $175 million senior unsecured notes. 20
ANNUALIZED REVENUE NUMBER OF PER ENCUMBERED MIDTOWN MANHATTAN SUB MARKET BUILDINGS SQUARE FEET OCCUPIED % OCCUPIED SF (Y/N) - ----------------- --------------------------- ---------- ----------- ----------- ------------ ----------- Office 599 Lexington Avenue.......... Park Avenue NY 1 1,019,772 95.9% $60.71 Y 280 Park Avenue............... Park Avenue NY 1 1,166,777 97.6% 54.15 Y Citigroup Center.............. Park Avenue NY 1 1,576,803 99.9% 56.97 Y (1)399 Park Avenue............ Park Avenue NY 1 1,677,433 100.0% 68.70 N (1)5 Times Square............. Times Square NY 1 1,103,290 98.8% 51.25 Y 875 Third Avenue.............. East Side NY 1 711,901 95.2% 56.73 Y -- --------- ----- ------ Total Midtown Manhattan: 6 7,255,976 98.4% $58.89 == ========= ===== ====== Princeton/East Brunswick, NJ Office 101 Carnegie Center........... Princeton NJ 1 119,652 100.0% $28.37 Y 104 Carnegie Center........... Princeton NJ 1 102,830 85.2% 31.77 N 105 Carnegie Center........... Princeton NJ 1 69,648 100.0% 28.80 N 201 Carnegie Center........... Princeton NJ -- 6,500 100.0% 24.04 N 202 Carnegie Center........... Princeton NJ 1 128,705 100.0% 29.73 Y 210 Carnegie Center........... Princeton NJ 1 161,112 100.0% 29.95 N 211 Carnegie Center........... Princeton NJ 1 47,025 100.0% 24.32 N 212 Carnegie Center........... Princeton NJ 1 146,518 100.0% 31.47 N 214 Carnegie Center........... Princeton NJ 1 148,584 94.8% 30.96 Y 206 Carnegie Center........... Princeton NJ 1 161,763 100.0% 28.10 Y 302 Carnegie Center........... Princeton NJ 1 65,135 95.5% 30.31 Y(2) 502 Carnegie Center........... Princeton NJ 1 116,374 95.3% 30.69 N 510 Carnegie Center........... Princeton NJ 1 234,160 100.0% 25.32 Y 504 Carnegie Center........... Princeton NJ 1 121,990 100.0% 26.94 Y 506 Carnegie Center........... Princeton NJ 1 136,213 56.2% 30.30 Y 508 Carnegie Center........... Princeton NJ 1 131,085 100.0% 25.29 Y One Tower Center.............. East Brunswick NJ 1 410,887 84.4% 32.62 N -- --------- ----- ------ Total Princeton/East Brunswick, NJ: 16 2,308,181 93.3% $29.31 == ========= ===== ====== Greater San Francisco Office Embarcadero Center One........ CBD San Francisco CA 1 833,727 97.8% $43.36 Y Embarcadero Center Two........ CBD San Francisco CA 1 780,441 88.3% 47.66 Y Embarcadero Center Three...... CBD San Francisco CA 1 773,632 89.1% 42.79 Y Embarcadero Center Four....... CBD San Francisco CA 1 935,821 93.1% 61.98 Y Federal Reserve............... CBD San Francisco CA 1 149,592 99.8% 49.44 Y West Tower.................... CBD San Francisco CA 1 467,781 96.1% 47.90 Y (1)611 Gateway................ South San Francisco CA 1 250,825 0.0% -- N 601 and 651 Gateway........... South San Francisco CA 2 509,720 86.1% 37.39 Y -- --------- ----- ------ 9 4,701,539 87.3% $48.02 -- --------- ----- ------ Office/Technical Hilltop Office Center......... South San Francisco CA 9 144,366 87.5% $14.97 -- --------- ----- ------ Industrial 560 Forbes Blvd............... South San Francisco CA 1 40,000 100.0% 10.54 N 430 Rozzi Place............... South San Francisco CA 1 20,000 100.0% 11.66 N -- --------- ----- ------ 2 60,000 100.0% $10.91 -- --------- ----- ------ Total Greater San Francisco: 20 4,905,905 87.4% $46.53 == ========= ===== ====== BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 IN-SERVICE PROPERTY LISTING AS OF DECEMBER 31, 2002 21
ANNUALIZED REVENUE NUMBER OF PER ENCUMBERED BALTIMORE, MD SUB MARKET BUILDINGS SQUARE FEET OCCUPIED % OCCUPIED SF (Y/N) - ------------- --------------------------- ---------- ----------- ----------- ------------ ----------- Office Candler Building.............. Baltimore MD 1 540,706 97.0% $19.18 N 100 East Pratt Street......... Baltimore MD 1 635,323 98.2% 31.69 Y -- --------- ----- ------ Total Baltimore, MD: 2 1,176,029 97.6% $25.98 == ========= ===== ====== Richmond, VA Office Riverfront Plaza.............. Richmond VA 1 899,586 91.8% $23.74 Y == ========= ===== ====== Bucks County, PA Industrial 38 Cabot Boulevard............ Bucks County PA 1 161,000 100.0% $4.79 N == ========= ===== ====== Total In-Service Properties: 133 31,954,862 93.9% == ========= ===== BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 TOP 20 TENANTS BY SQUARE FEET LEASED MAJOR SIGNED DEALS FOR FUTURE DEVELOPMENT
% OF TENANT SQ. FT. PORTFOLIO ------ --------- --------- 1 U.S. Government 1,408,595 4.41% 2 Citibank, N.A. 1,217,423 3.81% 3 Ernst and Young 1,064,939 3.33% 4 Lockheed Martin Corporation 676,414 2.12% 5 Shearman & Sterling 588,226 1.84% 6 Gillette Company 488,177 1.53% 7 Lehman Brothers 436,723 1.37% 8 Parametric Technology Corp. (1) 380,987 1.19% 9 Washington Group International 365,245 1.14% 10 Deutsche Bank 346,617 1.08% 11 Orbital Sciences Corporation 337,228 1.06% 12 Wachovia 319,966 1.00% 13 TRW, Inc. 318,963 1.00% 14 T. Rowe Price Associates, Inc. 304,129 0.95% 15 Hunton & Williams 301,081 0.94% 16 Digitas 279,182 0.87% 17 Accenture (1) 265,622 0.83% 18 Kirkland & Ellis 263,216 0.82% 19 Marsh USA Inc. 261,145 0.82% 20 Tellabs Operations, Inc. 259,918 0.81% Total % of Portfolio Square Feet 30.93% Total % of Portfolio Revenue 32.74% - ---------------------------------------- (1) These tenants occupy space in a property in which Boston Properties has a 25% interest. (2) Includes 97,205 sf of space in a property in which Boston Properties has a 50% interest and the remainder in a property in which Boston Properties has a 25% interest. 22
TENANT SQ. FT. - ------ -------- Finnegan Henderson Farabow Garrett & Dunner, LLP (2)........ 348,542 U.S. Government............................................. 257,400 BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 PORTFOLIO OVERVIEW--FFO Percentage of Property Funds from Operations (1) for In-Service Properties by Location and Type of Property for the Quarter Ended December 31, 2002
OFFICE/ GEOGRAPHIC AREA OFFICE (2) TECHNICAL INDUSTRIAL HOTEL TOTAL - --------------- ---------- --------- ---------- -------- -------- Greater Boston.............................................. 20.0% 0.6% 0.1% 6.5% 27.2% Greater Washington.......................................... 16.7% 1.1% -- -- 17.8% Greater San Francisco....................................... 13.6% 0.2% 0.1% -- 13.9% Midtown Manhattan........................................... 32.8% -- -- -- 32.8% Princeton/East Brunswick, NJ................................ 4.4% -- 4.4% Baltimore, MD............................................... 2.2% -- 2.2% Richmond, VA................................................ 1.6% -- 1.6% Bucks County, PA............................................ 0.1% -- 0.1% ---- --- --- --- ----- Total....................................................... 91.3% 1.9% 0.3% 6.5% 100.0% ==== === === === ===== - ------------------------ (1) For this table, Property Funds from Operations is equal to GAAP basis property NOI which includes the effect of straight-line rent and excludes any deduction for interest expense. (2) Includes Retail Center FFO (Prudential Center and Embarcadero Center). 23
GEOGRAPHIC AREA CBD SUBURBAN TOTAL - --------------- -------- -------- -------- Greater Boston.............................................. 20.3% 6.9% 27.2% Greater Washington.......................................... 5.3% 12.5% 17.8% Greater San Francisco....................................... 12.3% 1.6% 13.9% Midtown Manhattan........................................... 32.8% -- 32.8% Princeton/East Brunswick, NJ................................ -- 4.4% 4.4% Baltimore, MD............................................... 2.2% -- 2.2% Richmond, VA................................................ 1.6% -- 1.6% Bucks County, PA............................................ -- 0.1% 0.1% ---- ---- ----- Total....................................................... 74.5% 25.5% 100.0% ==== ==== ===== BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 OCCUPANCY ANALYSIS SAME PROPERTY OCCUPANCY -- BY LOCATION SAME PROPERTY -- BY TYPE OF PROPERTY
CBD SUBURBAN TOTAL --------------------- --------------------- --------------------- LOCATION 31-DEC-02 31-DEC-01 31-DEC-02 31-DEC-01 31-DEC-02 31-DEC-01 - -------- --------- --------- --------- --------- --------- --------- Greater Boston............................................ 90.8% 91.1% 91.1% 93.4% 91.0% 92.3% Greater Washington........................................ 99.2% 99.0% 95.8% 94.5% 97.0% 97.5% Midtown Manhattan......................................... 97.7% 99.8% -- -- 97.7% 99.8% Baltimore, MD............................................. 97.6% 99.2% -- -- 97.6% 99.2% Princeton/East Brunswick, NJ.............................. -- -- 93.3% 88.6% 93.3% 88.6% Richmond, VA.............................................. 91.8% 98.4% -- -- 91.8% 98.4% Greater San Francisco..................................... 93.0% 95.0% 87.6% 91.6% 92.1% 94.5% Bucks County, PA.......................................... -- -- 100.0% 100.0% 100.0% 100.0% ---- ---- ----- ----- ----- ----- Total Portfolio........................................... 95.0% 96.5% 93.2% 92.9% 94.3% 95.0% ==== ==== ===== ===== ===== ===== 24
CBD SUBURBAN TOTAL --------------------- --------------------- --------------------- LOCATION 31-DEC-02 31-DEC-01 31-DEC-02 31-DEC-01 31-DEC-02 31-DEC-01 - -------- --------- --------- --------- --------- --------- --------- Total Office Portfolio.................................... 94.9% 96.5% 93.2% 93.0% 94.3% 95.2% Total Office/Technical Portfolio.......................... 100.0% 100.0% 92.1% 91.8% 92.5% 92.1% Total Industrial Portfolio................................ -- -- 100.0% 95.6% 100.0% 95.6% ----- ----- ----- ----- ----- ----- Total Portfolio........................................... 95.0% 96.5% 93.2% 92.9% 94.3% 95.0% ===== ===== ===== ===== ===== ===== BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 IN-SERVICE OFFICE PROPERTIES LEASE EXPIRATIONS OCCUPANCY BY LOCATION
CURRENT ANNUALIZED ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER REVENUES UNDER YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES EXPIRING LEASES EXPIRATION EXPIRING LEASES EXPIRING LEASES P.S.F. WITH FUTURE STEP-UPS - -------------------------------------------- ------------------ ------------------ ------------------ -------------------- 2003........................................ 1,250,690 $ 41,584,084 $33.25 $ 41,732,745 2004........................................ 2,147,159 82,814,278 38.57 83,284,879 2005........................................ 2,449,146 91,432,763 37.33 94,151,454 2006........................................ 3,202,446 131,628,890 41.10 136,114,210 2007........................................ 2,269,650 86,115,272 37.94 89,898,779 2008........................................ 1,387,399 57,428,683 41.39 57,062,763 2009........................................ 2,433,279 89,372,226 36.73 98,293,229 2010........................................ 1,306,664 59,464,648 45.51 67,466,508 2011........................................ 2,667,183 106,196,363 39.82 122,348,692 2012........................................ 1,997,499 88,602,164 44.36 97,188,030 Thereafter.................................. 5,629,350 282,751,210 50.23 341,714,099 ANNUALIZED REVENUES UNDER EXPIRING YEAR OF LEASE LEASES WITH FUTURE PERCENTAGE OF EXPIRATION STEP-UPS--P.S.F. TOTAL SQUARE FEET - -------------------------------------------- -------------------- ----------------- 2003........................................ $33.37 4.39% 2004........................................ 38.79 7.54% 2005........................................ 38.44 8.60% 2006........................................ 42.50 11.25% 2007........................................ 39.61 7.97% 2008........................................ 41.13 4.87% 2009........................................ 40.40 8.55% 2010........................................ 51.63 4.59% 2011........................................ 45.87 9.37% 2012........................................ 48.65 7.02% Thereafter.................................. 60.70 19.78% * Includes approximately 1,500,000 of retail square footage. 25
CBD SUBURBAN TOTAL --------------------- --------------------- --------------------- LOCATION 31-DEC-02 31-DEC-01 31-DEC-02 31-DEC-01 31-DEC-02 31-DEC-01 - -------- --------- --------- --------- --------- --------- --------- Greater Boston............................................ 92.2% 90.9% 89.3% 92.6% 91.0% 91.7% Greater Washington........................................ 99.2% 99.3% 96.9% 96.5% 97.8% 97.9% Midtown Manhattan......................................... 98.4% 99.8% -- -- 98.4% 99.8% Baltimore, MD............................................. 97.6% 99.2% -- -- 97.6% 99.2% Princeton/East Brunswick, NJ.............................. -- -- 93.3% 88.6% 93.3% 88.6% Richmond, VA.............................................. 91.8% 98.4% -- -- 91.8% 98.4% Greater San Francisco..................................... 93.0% 95.0% 57.7% 91.3% 87.3% 94.6% Bucks County, PA.......................................... n/a n/a n/a n/a n/a n/a ----- ----- ----- ----- ----- ----- Total Portfolio......................................... 95.7%* 96.7%* 90.7% 93.0% 94.1% 95.4% ===== ===== ===== ===== ===== ===== BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 IN-SERVICE OFFICE/TECHNICAL PROPERTIES LEASE EXPIRATIONS OCCUPANCY BY LOCATION
CURRENT ANNUALIZED ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER REVENUES UNDER YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES EXPIRING LEASES EXPIRATION EXPIRING LEASES EXPIRING LEASES P.S.F. WITH FUTURE STEP-UPS - -------------------------------------------- ------------------ ------------------ ------------------ -------------------- 2003........................................ 144,687 $2,194,368 $15.17 $2,207,461 2004........................................ 82,291 1,432,462 17.41 1,468,857 2005........................................ 147,214 2,101,781 14.28 2,202,490 2006........................................ 295,604 3,989,038 13.49 4,376,135 2007........................................ 317,912 5,388,665 16.95 5,869,019 2008........................................ -- -- -- -- 2009........................................ -- -- -- -- 2010........................................ 79,971 1,167,906 14.60 1,167,906 2011........................................ 137,321 2,358,833 17.18 2,558,833 2012........................................ 67,362 1,466,955 21.78 1,618,519 Thereafter.................................. 135,750 2,123,844 15.65 2,372,805 ANNUALIZED REVENUES UNDER EXPIRING YEAR OF LEASE LEASES WITH FUTURE PERCENTAGE OF EXPIRATION STEP-UPS--P.S.F. TOTAL SQUARE FEET - -------------------------------------------- -------------------- ----------------- 2003........................................ $15.26 8.71% 2004........................................ 17.85 4.96% 2005........................................ 14.96 8.87% 2006........................................ 14.80 17.80% 2007........................................ 18.46 19.14% 2008........................................ -- -- 2009........................................ -- -- 2010........................................ 14.60 4.82% 2011........................................ 18.63 8.27% 2012........................................ 24.03 4.06% Thereafter.................................. 17.48 8.17% 26
CBD SUBURBAN TOTAL --------------------- --------------------- --------------------- LOCATION 31-DEC-02 31-DEC-01 31-DEC-02 31-DEC-01 31-DEC-02 31-DEC-01 - -------- --------- --------- --------- --------- --------- --------- Greater Boston............................................ 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% Greater Washington........................................ -- -- 84.3% 88.7% 84.3% 88.7% Midtown Manhattan......................................... n/a n/a n/a n/a n/a 89.0% Baltimore, MD............................................. n/a n/a n/a n/a n/a n/a Princeton/East Brunswick, NJ.............................. n/a n/a n/a n/a n/a n/a Richmond, VA.............................................. n/a n/a n/a n/a n/a n/a Greater San Francisco..................................... -- -- 87.5% 89.0% 87.5% Bucks County, PA.......................................... n/a n/a n/a n/a n/a n/a ----- ----- ----- ----- ----- ----- Total Portfolio......................................... 100.0% 100.0% 89.3% 91.8% 89.7% 92.1% ===== ===== ===== ===== ===== ===== BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 IN-SERVICE INDUSTRIAL PROPERTIES LEASE EXPIRATIONS OCCUPANCY BY LOCATION
CURRENT ANNUALIZED ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER REVENUES UNDER YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES EXPIRING LEASES EXPIRATION EXPIRING LEASES EXPIRING LEASES P.S.F. WITH FUTURE STEP-UPS - -------------------------------------------- ------------------ ------------------ ------------------ -------------------- 2003........................................ 152,009 $1,163,535 $ 7.65 $1,244,211 2004........................................ 201,000 1,192,524 5.93 1,202,124 2005........................................ -- -- -- -- 2006........................................ -- -- -- -- 2007........................................ 20,000 233,256 11.66 258,183 2008........................................ -- -- -- -- 2009........................................ -- -- -- -- 2010........................................ -- -- -- -- 2011........................................ -- -- -- -- 2012........................................ -- -- -- -- Thereafter.................................. -- -- -- -- ANNUALIZED REVENUES UNDER EXPIRING YEAR OF LEASE LEASES WITH FUTURE PERCENTAGE OF EXPIRATION STEP-UPS--P.S.F. TOTAL SQUARE FEET - -------------------------------------------- -------------------- ----------------- 2003........................................ $ 8.19 40.75% 2004........................................ 5.98 53.89% 2005........................................ -- -- 2006........................................ -- -- 2007........................................ 12.91 5.36% 2008........................................ -- -- 2009........................................ -- -- 2010........................................ -- -- 2011........................................ -- -- 2012........................................ -- -- Thereafter.................................. -- -- 27
CBD SUBURBAN TOTAL --------------------- --------------------- --------------------- LOCATION 31-DEC-02 31-DEC-01 31-DEC-02 31-DEC-01 31-DEC-02 31-DEC-01 - -------- --------- --------- --------- --------- --------- --------- Greater Boston............................................ -- -- 100.0% 89.8% 100.0% 89.8% Greater Washington........................................ n/a n/a n/a n/a n/a n/a Midtown Manhattan......................................... n/a n/a n/a n/a n/a n/a Baltimore, MD............................................. n/a n/a n/a n/a n/a n/a Princeton/East Brunswick, NJ.............................. n/a n/a n/a n/a n/a n/a Richmond, VA.............................................. n/a n/a n/a n/a n/a n/a Greater San Francisco..................................... -- -- 100.0% 78.6% 100.0% 78.6% Bucks County, PA.......................................... -- -- 100.0% 100.0% 100.0% 100.0% ----- ----- ----- ----- ----- ----- Total Portfolio......................................... -- -- 100.0% 87.3% 100.0% 87.3% ===== ===== ===== ===== ===== ===== BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 IN-SERVICE RETAIL PROPERTIES ]LEASE EXPIRATIONS (1) Includes $2,318,616 of annual revenue from the Prudential Center retail kiosks for which there is zero square footage assigned. 28
CURRENT ANNUALIZED ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER REVENUES UNDER YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES EXPIRING LEASES EXPIRATION EXPIRING LEASES EXPIRING LEASES P.S.F. WITH FUTURE STEP-UPS - -------------------------------------------- ------------------ ------------------ ------------------ -------------------- 2003........................................ 97,088 $ 7,902,768 $81.40(1) $ 7,910,522 2004........................................ 128,654 7,354,337 57.16 7,410,145 2005........................................ 94,366 4,367,574 46.28 4,551,725 2006........................................ 64,382 3,249,972 50.48 3,286,112 2007........................................ 63,857 2,977,620 46.63 3,185,655 2008........................................ 49,973 2,420,242 48.43 2,585,405 2009........................................ 35,048 1,575,948 44.97 1,681,298 2010........................................ 89,369 3,611,613 40.41 4,022,404 2011........................................ 41,689 2,606,290 62.52 3,012,288 2012........................................ 121,878 6,666,356 54.70 7,515,302 Thereafter.................................. 499,780 20,290,577 40.60 28,515,040 ANNUALIZED REVENUES UNDER EXPIRING YEAR OF LEASE LEASES WITH FUTURE PERCENTAGE OF EXPIRATION STEP-UPS--P.S.F. TOTAL SQUARE FEET - -------------------------------------------- -------------------- ----------------- 2003........................................ $81.48 6.66% 2004........................................ 57.60 8.83% 2005........................................ 48.23 6.48% 2006........................................ 51.04 4.42% 2007........................................ 49.89 4.38% 2008........................................ 51.74 3.43% 2009........................................ 47.97 2.41% 2010........................................ 45.01 6.13% 2011........................................ 72.26 2.86% 2012........................................ 61.66 8.37% Thereafter.................................. 57.06 34.31% BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 GRAND TOTAL OF ALL IN-SERVICE PROPERTIES LEASE EXPIRATIONS OCCUPANCY BY LOCATION
CURRENT ANNUALIZED ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER REVENUES UNDER YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES EXPIRING LEASES EXPIRATION EXPIRING LEASES EXPIRING LEASES P.S.F. WITH FUTURE STEP-UPS - -------------------------------------------- ------------------ ------------------ ------------------ -------------------- 2003........................................ 1,644,474 $ 52,844,755 $32.13 $ 53,094,939 2004........................................ 2,559,104 92,793,601 36.26 93,366,005 2005........................................ 2,690,726 97,902,119 36.39 100,905,670 2006........................................ 3,562,432 138,867,900 38.98 143,776,456 2007........................................ 2,671,419 94,714,813 35.45 99,211,635 2008........................................ 1,437,372 59,848,925 41.64 59,648,168 2009........................................ 2,468,327 90,948,175 36.85 99,974,527 2010........................................ 1,476,004 64,244,167 43.53 72,656,818 2011........................................ 2,846,193 111,161,486 39.06 127,919,813 2012........................................ 2,186,739 96,735,475 44.24 106,321,851 Thereafter.................................. 6,264,880 305,165,632 48.71 372,601,943 ANNUALIZED REVENUES UNDER EXPIRING YEAR OF LEASE LEASES WITH FUTURE PERCENTAGE OF EXPIRATION STEP-UPS--P.S.F. TOTAL SQUARE FEET - -------------------------------------------- -------------------- ----------------- 2003........................................ $32.29 5.15% 2004........................................ 36.48 8.01% 2005........................................ 37.50 8.42% 2006........................................ 40.36 11.15% 2007........................................ 37.14 8.36% 2008........................................ 41.50 4.50% 2009........................................ 40.50 7.72% 2010........................................ 49.23 4.62% 2011........................................ 44.94 8.91% 2012........................................ 48.62 6.84% Thereafter.................................. 59.47 19.61% 29
CBD SUBURBAN TOTAL --------------------- --------------------- --------------------- LOCATION 31-DEC-02 31-DEC-01 31-DEC-02 31-DEC-01 31-DEC-02 31-DEC-01 - -------- --------- --------- --------- --------- --------- --------- Greater Boston............................................ 92.3% 91.1% 91.1% 93.4% 91.8% 92.3% Greater Washington........................................ 99.2% 99.3% 94.3% 94.5% 95.9% 97.8% Midtown Manhattan......................................... 98.4% 99.8% -- -- 98.4% 99.8% Baltimore, MD............................................. 97.6% 99.2% -- -- 97.6% 99.2% Princeton/East Brunswick, NJ.............................. -- -- 93.3% 88.6% 93.3% 88.6% Richmond, VA.............................................. 91.8% 98.4% -- -- 91.8% 98.4% Greater San Francisco..................................... 93.0% 95.0% 64.8% 87.1% 87.4% 93.5% Bucks County, PA.......................................... -- -- 100.0% 100.0% 100.0% 100.0% ----- ----- ----- ----- ----- ----- Total Portfolio......................................... 95.7% 96.7% 90.8% 92.5% 93.9% 95.0% ===== ===== ===== ===== ===== ===== BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 IN-SERVICE GREATER BOSTON PROPERTIES LEASE EXPIRATIONS--GREATER BOSTON
OFFICE/TECHNICAL ------------------ OFFICE -------------------------------------------------------------- ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER RENTABLE SQUARE YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES FOOTAGE SUBJECT TO EXPIRATION EXPIRING LEASES EXPIRING LEASES WITH FUTURE STEP-UPS EXPIRING LEASES - ---------------------------------------------- ------------------ ------------------ -------------------- ------------------ 2003.......................................... 272,245 $ 7,922,160 $ 7,982,167 -- 2004.......................................... 646,994 24,267,597 24,610,085 -- 2005.......................................... 859,312 33,919,465 34,509,418 -- 2006.......................................... 572,608 20,896,210 21,296,025 253,704 2007.......................................... 386,122 16,282,558 17,012,796 144,140 2008.......................................... 125,579 4,043,043 4,160,919 -- 2009.......................................... 944,472 33,860,325 37,315,155 -- 2010.......................................... 170,346 6,781,620 7,702,342 -- 2011.......................................... 762,735 26,625,094 31,762,240 80,000 2012.......................................... 606,807 21,031,156 24,146,350 67,362 Thereafter.................................... 679,652 26,348,739 33,804,339 -- OFFICE/TECHNICAL --------------------------------------- ANNUALIZED CURRENT ANNUALIZED REVENUES UNDER REVENUES UNDER EXPIRING LEASES YEAR OF LEASE EXPIRING LEASES WITH FUTURE STEP- EXPIRATION P.S.F. UPS--P.S.F. - ---------------------------------------------- ------------------ ------------------ 2003.......................................... $ -- $ -- 2004.......................................... -- -- 2005.......................................... -- -- 2006.......................................... 3,328,641 3,663,288 2007.......................................... 1,784,982 2,208,262 2008.......................................... -- -- 2009.......................................... -- -- 2010.......................................... -- -- 2011.......................................... 1,579,750 1,779,750 2012.......................................... 1,466,955 1,618,519 Thereafter.................................... -- -- (1) Includes $2,318,616 of annual revenue from the Prudential Center retail kiosks for which there is zero square footage assigned. 30
INDUSTRIAL RETAIL -------------------------------------------------------------- ------------------ ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER RENTABLE SQUARE YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES FOOTAGE SUBJECT TO EXPIRATION EXPIRING LEASES EXPIRING LEASES WITH FUTURE STEP-UPS EXPIRING LEASES - ---------------------------------------------- ------------------ ------------------ -------------------- ------------------ 2003.......................................... 152,009 $1,163,535 $1,244,211 55,534 2004.......................................... -- -- -- 87,456 2005.......................................... -- -- -- 58,554 2006.......................................... -- -- -- 15,154 2007.......................................... -- -- -- 432 2008.......................................... -- -- -- 5,466 2009.......................................... -- -- -- -- 2010.......................................... -- -- -- 37,110 2011.......................................... -- -- -- 11,599 2012.......................................... -- -- -- 55,076 Thereafter.................................... -- -- -- 337,648 RETAIL ----------------------------------------- ANNUALIZED CURRENT ANNUALIZED REVENUES UNDER YEAR OF LEASE REVENUES UNDER EXPIRING LEASES EXPIRATION EXPIRING LEASES WITH FUTURE STEP-UPS - ---------------------------------------------- ------------------ -------------------- 2003.......................................... $5,842,381 $ 5,878,681 2004.......................................... 5,429,030 5,454,530 2005.......................................... 2,465,639 2,581,631 2006.......................................... 1,057,710 1,064,390 2007.......................................... 55,923 63,300 2008.......................................... 427,825 427,825 2009.......................................... -- -- 2010.......................................... 1,418,251 1,492,471 2011.......................................... 619,611 668,111 2012.......................................... 1,917,359 2,005,503 Thereafter.................................... 8,342,871 12,762,671 BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 IN-SERVICE GREATER BOSTON PROPERTIES QUARTERLY LEASE EXPIRATIONS--GREATER BOSTON
OFFICE OFFICE/TECHNICAL -------------------------------------------------------------- ------------------ ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER RENTABLE SQUARE YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES FOOTAGE SUBJECT TO EXPIRATION EXPIRING LEASES EXPIRING LEASES WITH FUTURE STEP-UPS EXPIRING LEASES - ---------------------------------------------- ------------------ ------------------ -------------------- ------------------ Q1 2003....................................... 70,176 $ 2,829,846 $ 2,829,846 $ -- Q2 2003....................................... 60,385 1,899,622 1,956,491 -- Q3 2003....................................... 103,329 2,101,683 2,101,683 -- Q4 2003....................................... 38,355 1,091,009 1,094,147 -- ----------- ------------ ----------- ----------- Total 2003.................................... 272,245 7,922,160 7,982,167 -- =========== ============ =========== =========== Q1 2004....................................... 57,562 1,929,723 1,936,617 -- Q2 2004....................................... 102,197 3,602,344 3,658,491 -- Q3 2004....................................... 344,874 13,930,379 14,182,581 -- Q4 2004....................................... 142,361 4,805,151 4,832,396 -- ----------- ------------ ----------- ----------- Total 2004.................................... 646,994 24,267,596 24,610,085 -- =========== ============ =========== =========== OFFICE/TECHNICAL ----------------------------------------- ANNUALIZED CURRENT ANNUALIZED REVENUES UNDER YEAR OF LEASE REVENUES UNDER EXPIRING LEASES EXPIRATION EXPIRING LEASES WITH FUTURE STEP-UPS - ---------------------------------------------- ------------------ -------------------- Q1 2003....................................... $ -- $ -- Q2 2003....................................... -- -- Q3 2003....................................... -- -- Q4 2003....................................... -- -- ----------- ----------- Total 2003.................................... -- -- =========== =========== Q1 2004....................................... -- -- Q2 2004....................................... -- -- Q3 2004....................................... -- -- Q4 2004....................................... -- -- ----------- ----------- Total 2004.................................... -- -- =========== =========== 31
INDUSTRIAL RETAIL -------------------------------------------------------------- ------------------ ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER RENTABLE SQUARE YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES FOOTAGE SUBJECT TO EXPIRATION EXPIRING LEASES EXPIRING LEASES WITH FUTURE STEP-UPS EXPIRING LEASES - ---------------------------------------------- ------------------ ------------------ -------------------- ------------------ Q1 2003....................................... 23,904 $ 210,852 $ 291,528 20,747 Q2 2003....................................... -- -- -- 4,000 Q3 2003....................................... 128,105 952,684 952,684 1,075 Q4 2003....................................... -- -- -- 29,712 ----------- ------------ ----------- ----------- Total 2003.................................... 152,009 $ 1,163,535 $ 1,244,211 55,534 =========== ============ =========== =========== Q1 2004....................................... -- -- -- 59,704 Q2 2004....................................... -- -- -- 9,669 Q3 2004....................................... -- -- -- 3,187 Q4 2004....................................... -- -- -- 14,896 ----------- ------------ ----------- ----------- Total 2004.................................... -- -- -- 87,456 =========== ============ =========== =========== RETAIL ----------------------------------------- ANNUALIZED CURRENT ANNUALIZED REVENUES UNDER YEAR OF LEASE REVENUES UNDER EXPIRING LEASES EXPIRATION EXPIRING LEASES WITH FUTURE STEP-UPS - ---------------------------------------------- ------------------ -------------------- Q1 2003....................................... $ 908,811 $ 1,029,411 Q2 2003....................................... 1,079,826 796,026 Q3 2003....................................... 163,000 139,000 Q4 2003....................................... 3,690,744 3,914,244 ----------- ----------- Total 2003.................................... $ 5,842,381 $ 5,878,681 =========== =========== Q1 2004....................................... 3,822,537 3,822,537 Q2 2004....................................... 851,927 851,927 Q3 2004....................................... 292,533 292,533 Q4 2004....................................... 462,033 487,533 ----------- ----------- Total 2004.................................... $ 5,429,030 $ 5,454,530 =========== =========== BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 IN-SERVICE GREATER WASHINGTON PROPERTIES LEASE EXPIRATIONS--GREATER WASHINGTON
OFFICE OFFICE/TECHNICAL -------------------------------------------------------------- ------------------ ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER RENTABLE SQUARE YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES FOOTAGE SUBJECT TO EXPIRATION EXPIRING LEASES EXPIRING LEASES WITH FUTURE STEP-UPS EXPIRING LEASES - ---------------------------------------------- ------------------ ------------------ -------------------- ------------------ 2003.......................................... 121,576 $ 3,671,295 $ 3,690,565 100,912 2004.......................................... 223,328 8,129,248 8,352,697 67,791 2005.......................................... 490,525 17,267,678 18,406,164 101,345 2006.......................................... 425,184 12,162,224 13,013,019 33,400 2007.......................................... 654,110 20,935,582 21,602,057 163,422 2008.......................................... 424,056 17,008,484 13,655,805 -- 2009.......................................... 694,507 23,052,385 24,542,810 -- 2010.......................................... 518,240 20,036,460 23,720,277 79,971 2011.......................................... 1,062,026 31,858,178 38,081,807 57,321 2012.......................................... 309,951 10,472,201 13,052,257 -- Thereafter.................................... 1,013,679 32,241,696 38,449,678 135,750 OFFICE/TECHNICAL ----------------------------------------- ANNUALIZED CURRENT ANNUALIZED REVENUES UNDER YEAR OF LEASE REVENUES UNDER EXPIRING LEASES EXPIRATION EXPIRING LEASES WITH FUTURE STEP-UPS - ---------------------------------------------- ------------------ -------------------- 2003.......................................... $ 1,463,566 $ 1,476,660 2004.......................................... 1,196,458 1,226,493 2005.......................................... 1,446,746 1,518,966 2006.......................................... 522,025 563,495 2007.......................................... 3,472,883 3,500,437 2008.......................................... -- -- 2009.......................................... -- -- 2010.......................................... 1,167,906 1,167,906 2011.......................................... 779,083 779,083 2012.......................................... -- -- Thereafter.................................... 2,123,844 2,372,805 32
INDUSTRIAL RETAIL -------------------------------------------------------------- ------------------ ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER RENTABLE SQUARE YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES FOOTAGE SUBJECT TO EXPIRATION EXPIRING LEASES EXPIRING LEASES WITH FUTURE STEP-UPS EXPIRING LEASES - ---------------------------------------------- ------------------ ------------------ -------------------- ------------------ 2003.......................................... -- $ -- $ -- 810 2004.......................................... -- -- -- 5,209 2005.......................................... -- -- -- 9,570 2006.......................................... -- -- -- 6,645 2007.......................................... -- -- -- 23,248 2008.......................................... -- -- -- 16,338 2009.......................................... -- -- -- -- 2010.......................................... -- -- -- 10,277 2011.......................................... -- -- -- 11,221 2012.......................................... -- -- -- 7,519 Thereafter.................................... -- -- -- 23,685 RETAIL ----------------------------------------- ANNUALIZED CURRENT ANNUALIZED REVENUES UNDER YEAR OF LEASE REVENUES UNDER EXPIRING LEASES EXPIRATION EXPIRING LEASES WITH FUTURE STEP-UPS - ---------------------------------------------- ------------------ -------------------- 2003.......................................... $ 27,770 $ 27,770 2004.......................................... 209,969 212,995 2005.......................................... 390,327 407,080 2006.......................................... 277,533 277,898 2007.......................................... 676,112 699,382 2008.......................................... 583,620 670,555 2009.......................................... -- -- 2010.......................................... 370,157 430,861 2011.......................................... 468,529 528,386 2012.......................................... 149,731 185,933 Thereafter.................................... 789,615 1,109,914 BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 IN-SERVICE GREATER WASHINGTON PROPERTIES QUARTERLY LEASE EXPIRATIONS--GREATER WASHINGTON
OFFICE OFFICE/TECHNICAL -------------------------------------------------------------- ------------------ ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER RENTABLE SQUARE YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES FOOTAGE SUBJECT TO EXPIRATION EXPIRING LEASES EXPIRING LEASES WITH FUTURE STEP-UPS EXPIRING LEASES - ---------------------------------------------- ------------------ ------------------ -------------------- ------------------ Q1 2003....................................... -- $ -- $ -- 25,384 Q2 2003....................................... 76,266 2,220,628 2,221,903 36,847 Q3 2003....................................... 23,624 850,289 859,500 31,681 Q4 2003....................................... 21,686 600,378 609,161 7,000 ----------- ------------ ----------- ----------- Total 2003.................................... 121,576 3,671,295 3,690,565 100,912 =========== ============ =========== =========== Q1 2004....................................... 50,565 1,625,490 1,671,762 14,338 Q2 2004....................................... 46,308 1,448,442 1,480,457 43,101 Q3 2004....................................... 94,622 3,833,272 3,954,805 -- Q4 2004....................................... 31,833 1,222,044 1,245,673 10,352 ----------- ------------ ----------- ----------- Total 2004.................................... 223,328 8,129,248 8,352,697 67,791 =========== ============ =========== =========== OFFICE/TECHNICAL ----------------------------------------- ANNUALIZED CURRENT ANNUALIZED REVENUES UNDER YEAR OF LEASE REVENUES UNDER EXPIRING LEASES EXPIRATION EXPIRING LEASES WITH FUTURE STEP-UPS - ---------------------------------------------- ------------------ -------------------- Q1 2003....................................... $ 385,950 $ 385,950 Q2 2003....................................... 544,335 557,429 Q3 2003....................................... 435,281 435,281 Q4 2003....................................... 98,000.04 98,000.04 ----------- ----------- Total 2003.................................... 1,463,566 1,476,660 =========== =========== Q1 2004....................................... 231,585 237,562 Q2 2004....................................... 742,853 760,424 Q3 2004....................................... -- -- Q4 2004....................................... 222,020 228,507 ----------- ----------- Total 2004.................................... 1,196,458 1,226,493 =========== =========== 33
INDUSTRIAL RETAIL -------------------------------------------------------------- ------------------ ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER RENTABLE SQUARE YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES FOOTAGE SUBJECT TO EXPIRATION EXPIRING LEASES EXPIRING LEASES WITH FUTURE STEP-UPS EXPIRING LEASES - ---------------------------------------------- ------------------ ------------------ -------------------- ------------------ Q1 2003....................................... -- $ -- $ -- -- Q2 2003....................................... -- -- -- -- Q3 2003....................................... -- -- -- -- Q4 2003....................................... -- -- -- 810 ----------- ------------ ----------- ----------- Total 2003.................................... -- -- -- 810 =========== ============ =========== =========== Q1 2004....................................... -- -- -- 2,183 Q2 2004....................................... -- -- -- 3,026 Q3 2004....................................... -- -- -- -- Q4 2004....................................... -- -- -- -- ----------- ------------ ----------- ----------- Total 2004.................................... -- -- -- 5,209 =========== ============ =========== =========== RETAIL ----------------------------------------- ANNUALIZED CURRENT ANNUALIZED REVENUES UNDER YEAR OF LEASE REVENUES UNDER EXPIRING LEASES EXPIRATION EXPIRING LEASES WITH FUTURE STEP-UPS - ---------------------------------------------- ------------------ -------------------- Q1 2003....................................... $ -- $ -- Q2 2003....................................... -- -- Q3 2003....................................... -- -- Q4 2003....................................... 27,770 27,770 ----------- ----------- Total 2003.................................... 27,770 27,770 =========== =========== Q1 2004....................................... 72,212 72,212 Q2 2004....................................... 137,756 140,782 Q3 2004....................................... -- -- Q4 2004....................................... -- -- ----------- ----------- Total 2004.................................... 209,969 212,995 =========== =========== BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 IN-SERVICE GREATER SAN FRANCISCO PROPERTIES LEASE EXPIRATIONS--GREATER SAN FRANCISCO
OFFICE OFFICE/TECHNICAL -------------------------------------------------------------- ------------------ ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER RENTABLE SQUARE YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES FOOTAGE SUBJECT TO EXPIRATION EXPIRING LEASES EXPIRING LEASES WITH FUTURE STEP-UPS EXPIRING LEASES - ---------------------------------------------- ------------------ ------------------ -------------------- ------------------ 2003.......................................... 471,805 $ 18,082,335 $18,134,589 43,775 2004.......................................... 574,955 26,274,912 26,081,285 14,500 2005.......................................... 355,723 16,143,321 16,612,141 45,869 2006.......................................... 910,348 44,825,519 46,596,967 8,500 2007.......................................... 427,809 20,237,351 21,176,850 10,350 2008.......................................... 167,410 6,748,689 7,064,266 -- 2009.......................................... 254,262 11,012,778 11,694,736 -- 2010.......................................... 180,943 10,771,710 12,645,530 -- 2011.......................................... 192,689 17,971,253 18,463,847 -- 2012.......................................... 127,682 5,184,464 5,699,105 -- Thereafter.................................... 144,115 6,219,404 6,604,054 -- OFFICE/TECHNICAL ----------------------------------------- ANNUALIZED CURRENT ANNUALIZED REVENUES UNDER YEAR OF LEASE REVENUES UNDER EXPIRING LEASES EXPIRATION EXPIRING LEASES WITH FUTURE STEP-UPS - ---------------------------------------------- ------------------ -------------------- 2003.......................................... $ 730,802 $ 730,802 2004.......................................... 236,004 242,364 2005.......................................... 655,035 683,525 2006.......................................... 138,372 149,352 2007.......................................... 130,800 160,320 2008.......................................... -- -- 2009.......................................... -- -- 2010.......................................... -- -- 2011.......................................... -- -- 2012.......................................... -- -- Thereafter.................................... -- -- 34
INDUSTRIAL RETAIL -------------------------------------------------------------- ------------------ ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER RENTABLE SQUARE YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES FOOTAGE SUBJECT TO EXPIRATION EXPIRING LEASES EXPIRING LEASES WITH FUTURE STEP-UPS EXPIRING LEASES - ---------------------------------------------- ------------------ ------------------ -------------------- ------------------ 2003.......................................... -- $ -- $ -- 38,429 2004.......................................... 40,000 421,476 431,076 29,285 2005.......................................... -- -- -- 23,012 2006.......................................... -- -- -- 18,043 2007.......................................... 20,000 233,256 258,183 20,891 2008.......................................... -- -- -- 24,937 2009.......................................... -- -- -- 35,048 2010.......................................... -- -- -- 30,749 2011.......................................... -- -- -- 3,474 2012.......................................... -- -- -- 35,018 Thereafter.................................... -- -- -- 7,690 RETAIL ----------------------------------------- ANNUALIZED CURRENT ANNUALIZED REVENUES UNDER YEAR OF LEASE REVENUES UNDER EXPIRING LEASES EXPIRATION EXPIRING LEASES WITH FUTURE STEP-UPS - ---------------------------------------------- ------------------ -------------------- 2003.......................................... $ 1,708,645 $ 1,680,098 2004.......................................... 1,405,724 1,423,453 2005.......................................... 1,136,754 1,157,770 2006.......................................... 901,480 908,608 2007.......................................... 1,345,300 1,427,788 2008.......................................... 1,256,211 1,317,897 2009.......................................... 1,575,948 1,681,298 2010.......................................... 1,285,287 1,464,401 2011.......................................... 196,298 229,226 2012.......................................... 2,090,812 2,405,158 Thereafter.................................... 523,973 577,532 BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 IN-SERVICE GREATER SAN FRANCISCO PROPERTIES QUARTERLY LEASE EXPIRATIONS--GREATER SAN FRANCISCO
OFFICE OFFICE/TECHNICAL -------------------------------------------------------------- ------------------ ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER RENTABLE SQUARE YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES FOOTAGE SUBJECT TO EXPIRATION EXPIRING LEASES EXPIRING LEASES WITH FUTURE STEP-UPS EXPIRING LEASES - ---------------------------------------------- ------------------ ------------------ -------------------- ------------------ Q1 2003....................................... 81,123 $ 3,212,565 $ 3,229,053 5,255 Q2 2003....................................... 65,402 2,840,569 2,840,569 19,001 Q3 2003....................................... 18,428 575,311 575,311 10,547 Q4 2003....................................... 306,852 11,453,890 11,489,656 8,972 ----------- ------------ ----------- ----------- Total 2003.................................... 471,805 18,082,335 18,134,589 43,775 =========== ============ =========== =========== Q1 2004....................................... 28,229 1,618,998 1,636,807 -- Q2 2004....................................... 157,863 6,709,593 6,712,965 5,000 Q3 2004....................................... 230,631 10,718,107 10,725,554 5,500 Q4 2004....................................... 158,232 7,228,215 7,005,959 4,000 ----------- ------------ ----------- ----------- Total 2004.................................... 574,955 26,274,912 26,081,285 14,500 =========== ============ =========== =========== OFFICE/TECHNICAL ----------------------------------------- ANNUALIZED CURRENT ANNUALIZED REVENUES UNDER YEAR OF LEASE REVENUES UNDER EXPIRING LEASES EXPIRATION EXPIRING LEASES WITH FUTURE STEP-UPS - ---------------------------------------------- ------------------ -------------------- Q1 2003....................................... $ 97,683 $ 97,683 Q2 2003....................................... 300,673 300,673 Q3 2003....................................... 171,048 171,048 Q4 2003....................................... 161,398 161,398 ----------- ----------- Total 2003.................................... 730,802 730,802 =========== =========== Q1 2004....................................... -- -- Q2 2004....................................... 79,548 81,648 Q3 2004....................................... 98,628 101,268 Q4 2004....................................... 57,828 59,448 ----------- ----------- Total 2004.................................... 236,004 242,364 =========== =========== 35
INDUSTRIAL RETAIL -------------------------------------------------------------- ------------------ ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER RENTABLE SQUARE YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES FOOTAGE SUBJECT TO EXPIRATION EXPIRING LEASES EXPIRING LEASES WITH FUTURE STEP-UPS EXPIRING LEASES - ---------------------------------------------- ------------------ ------------------ -------------------- ------------------ Q1 2003....................................... -- $ -- $ -- 5,807 Q2 2003....................................... -- -- -- 7,412 Q3 2003....................................... -- -- -- -- Q4 2003....................................... -- -- -- 25,210 ----------- ------------ ----------- ----------- Total 2003.................................... -- -- -- 38,429 =========== ============ =========== =========== Q1 2004....................................... -- -- -- 16,598 Q2 2004....................................... -- -- -- -- Q3 2004....................................... -- -- -- 4,982 Q4 2004....................................... 40,000 421,476 431,076 7,705 ----------- ------------ ----------- ----------- Total 2004.................................... 40,000 421,476 431,076 29,285 =========== ============ =========== =========== RETAIL ----------------------------------------- ANNUALIZED CURRENT ANNUALIZED REVENUES UNDER YEAR OF LEASE REVENUES UNDER EXPIRING LEASES EXPIRATION EXPIRING LEASES WITH FUTURE STEP-UPS - ---------------------------------------------- ------------------ -------------------- Q1 2003....................................... $ 141,189 $ 105,700 Q2 2003....................................... 536,354 536,354 Q3 2003....................................... -- -- Q4 2003....................................... 1,031,102 1,038,044 ----------- ----------- Total 2003.................................... 1,708,645 1,680,098 =========== =========== Q1 2004....................................... 696,786 714,515 Q2 2004....................................... -- -- Q3 2004....................................... 285,245 285,245 Q4 2004....................................... 423,693 423,693 ----------- ----------- Total 2004.................................... 1,405,724 1,423,453 =========== =========== BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 IN-SERVICE MIDTOWN MANHATTAN PROPERTIES LEASE EXPIRATIONS--MIDTOWN MANHATTAN
OFFICE OFFICE/TECHNICAL -------------------------------------------------------------- ------------------ ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER RENTABLE SQUARE YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES FOOTAGE SUBJECT TO EXPIRATION EXPIRING LEASES EXPIRING LEASES WITH FUTURE STEP-UPS EXPIRING LEASES - ---------------------------------------------- ------------------ ------------------ -------------------- ------------------ 2003.......................................... 121,520 $ 5,515,989 $ 5,515,989 -- 2004.......................................... 164,723 9,325,127 9,340,151 -- 2005.......................................... 113,291 7,151,927 7,173,577 -- 2006.......................................... 481,316 30,138,998 30,572,610 -- 2007.......................................... 201,557 12,045,052 12,147,947 -- 2008.......................................... 462,395 25,726,448 27,577,804 -- 2009.......................................... 250,804 13,998,636 16,022,270 -- 2010.......................................... 262,620 16,574,296 17,565,611 -- 2011.......................................... 390,174 22,088,621 25,528,549 -- 2012.......................................... 922,493 50,959,155 53,071,040 -- Thereafter.................................... 3,549,815 210,677,445 254,861,719 -- OFFICE/TECHNICAL ----------------------------------------- ANNUALIZED CURRENT ANNUALIZED REVENUES UNDER YEAR OF LEASE REVENUES UNDER EXPIRING LEASES EXPIRATION EXPIRING LEASES WITH FUTURE STEP-UPS - ---------------------------------------------- ------------------ -------------------- 2003.......................................... $ -- $ -- 2004.......................................... -- -- 2005.......................................... -- -- 2006.......................................... -- -- 2007.......................................... -- -- 2008.......................................... -- -- 2009.......................................... -- -- 2010.......................................... -- -- 2011.......................................... -- -- 2012.......................................... -- -- Thereafter.................................... -- -- 36
INDUSTRIAL RETAIL -------------------------------------------------------------- ------------------ ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER RENTABLE SQUARE YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES FOOTAGE SUBJECT TO EXPIRATION EXPIRING LEASES EXPIRING LEASES WITH FUTURE STEP-UPS EXPIRING LEASES - ---------------------------------------------- ------------------ ------------------ -------------------- ------------------ 2003.......................................... -- $ -- $ -- 2,315 2004.......................................... -- -- -- 3,800 2005.......................................... -- -- -- 3,230 2006.......................................... -- -- -- 17,700 2007.......................................... -- -- -- 6,876 2008.......................................... -- -- -- 3,232 2009.......................................... -- -- -- -- 2010.......................................... -- -- -- 10,608 2011.......................................... -- -- -- 15,395 2012.......................................... -- -- -- 22,865 Thereafter.................................... -- -- -- 128,242 RETAIL ----------------------------------------- ANNUALIZED CURRENT ANNUALIZED REVENUES UNDER YEAR OF LEASE REVENUES UNDER EXPIRING LEASES EXPIRATION EXPIRING LEASES WITH FUTURE STEP-UPS - ---------------------------------------------- ------------------ -------------------- 2003.......................................... $ 323,973 $ 323,973 2004.......................................... 257,239 266,573 2005.......................................... 374,855 405,244 2006.......................................... 784,617 806,582 2007.......................................... 644,793 709,055 2008.......................................... 152,587 169,129 2009.......................................... -- -- 2010.......................................... 523,164 615,535 2011.......................................... 1,321,852 1,586,565 2012.......................................... 2,496,354 2,904,825 Thereafter.................................... 10,577,504 13,997,218 BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 IN-SERVICE MIDTOWN MANHATTAN PROPERTIES QUARTERLY LEASE EXPIRATIONS--MIDTOWN MANHATTAN
OFFICE OFFICE/TECHNICAL -------------------------------------------------------------- ------------------ ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER RENTABLE SQUARE YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES FOOTAGE SUBJECT TO EXPIRATION EXPIRING LEASES EXPIRING LEASES WITH FUTURE STEP-UPS EXPIRING LEASES - ---------------------------------------------- ------------------ ------------------ -------------------- ------------------ Q1 2003....................................... $ -- $ -- $ -- $ -- Q2 2003....................................... 37,005 2,090,493 2,090,493 -- Q3 2003....................................... 59,016 2,071,770 2,071,770 -- Q4 2003....................................... 25,499 1,353,726 1,353,726 -- ----------- ------------ ----------- ----------- Total 2003.................................... 121,520 5,515,989 5,515,989 -- =========== ============ =========== =========== Q1 2004....................................... -- -- -- -- Q2 2004....................................... 53,473 4,109,433 4,109,433 -- Q3 2004....................................... -- -- -- -- Q4 2004....................................... 111,250 5,215,694 5,230,718 -- ----------- ------------ ----------- ----------- Total 2004.................................... 164,723 9,325,127 9,340,151 -- =========== ============ =========== =========== OFFICE/TECHNICAL ----------------------------------------- ANNUALIZED CURRENT ANNUALIZED REVENUES UNDER YEAR OF LEASE REVENUES UNDER EXPIRING LEASES EXPIRATION EXPIRING LEASES WITH FUTURE STEP-UPS - ---------------------------------------------- ------------------ -------------------- Q1 2003....................................... $ -- $ -- Q2 2003....................................... -- -- Q3 2003....................................... -- -- Q4 2003....................................... -- -- ----------- ----------- Total 2003.................................... -- -- =========== =========== Q1 2004....................................... -- -- Q2 2004....................................... -- -- Q3 2004....................................... -- -- Q4 2004....................................... -- -- ----------- ----------- Total 2004.................................... -- -- =========== =========== 37
INDUSTRIAL RETAIL -------------------------------------------------------------- ------------------ ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER RENTABLE SQUARE YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES FOOTAGE SUBJECT TO EXPIRATION EXPIRING LEASES EXPIRING LEASES WITH FUTURE STEP-UPS EXPIRING LEASES - ---------------------------------------------- ------------------ ------------------ -------------------- ------------------ Q1 2003....................................... -- $ -- $ -- -- Q2 2003....................................... -- -- -- -- Q3 2003....................................... -- -- -- 1,515 Q4 2003....................................... -- -- -- 800 ----------- ------------ ----------- ----------- Total 2003.................................... -- -- -- 2,315 =========== ============ =========== =========== Q1 2004....................................... -- -- -- -- Q2 2004....................................... -- -- -- 350 Q3 2004....................................... -- -- -- -- Q4 2004....................................... -- -- -- 3,450 ----------- ------------ ----------- ----------- Total 2004.................................... -- -- -- 3,800 =========== ============ =========== =========== RETAIL ----------------------------------------- ANNUALIZED CURRENT ANNUALIZED REVENUES UNDER YEAR OF LEASE REVENUES UNDER EXPIRING LEASES EXPIRATION EXPIRING LEASES WITH FUTURE STEP-UPS - ---------------------------------------------- ------------------ -------------------- Q1 2003....................................... $ -- $ -- Q2 2003....................................... -- -- Q3 2003....................................... 64,220 64,220 Q4 2003....................................... 259,753 259,753 ----------- ----------- Total 2003.................................... 323,973 323,973 =========== =========== Q1 2004....................................... -- -- Q2 2004....................................... 47,345 50,139 Q3 2004....................................... -- -- Q4 2004....................................... 209,894 216,434 ----------- ----------- Total 2004.................................... 257,239 266,573 =========== =========== BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 IN-SERVICE PRINCETON/EAST BRUNSWICK PROPERTIES LEASE EXPIRATIONS--PRINCETON/EAST BRUNSWICK
OFFICE OFFICE/TECHNICAL -------------------------------------------------------------- ------------------ ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER RENTABLE SQUARE YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES FOOTAGE SUBJECT TO EXPIRATION EXPIRING LEASES EXPIRING LEASES WITH FUTURE STEP-UPS EXPIRING LEASES - ---------------------------------------------- ------------------ ------------------ -------------------- ------------------ 2003.......................................... 97,193 $ 2,788,097 $ 2,788,097 -- 2004.......................................... 410,880 12,085,326 12,108,249 -- 2005.......................................... 237,630 7,261,045 7,350,624 -- 2006.......................................... 87,691 2,845,967 2,998,578 -- 2007.......................................... 510,959 13,820,256 15,047,700 -- 2008.......................................... -- -- -- -- 2009.......................................... 161,514 4,886,156 5,645,940 -- 2010.......................................... 145,675 4,690,766 5,105,120 -- 2011.......................................... 254,941 7,534,086 8,375,570 -- 2012.......................................... -- -- -- -- Thereafter.................................... 237,429 7,160,772 7,849,057 -- OFFICE/TECHNICAL ----------------------------------------- ANNUALIZED CURRENT ANNUALIZED REVENUES UNDER YEAR OF LEASE REVENUES UNDER EXPIRING LEASES EXPIRATION EXPIRING LEASES WITH FUTURE STEP-UPS - ---------------------------------------------- ------------------ -------------------- 2003.......................................... $ -- $ -- 2004.......................................... -- -- 2005.......................................... -- -- 2006.......................................... -- -- 2007.......................................... -- -- 2008.......................................... -- -- 2009.......................................... -- -- 2010.......................................... -- -- 2011.......................................... -- -- 2012.......................................... -- -- Thereafter.................................... -- -- 38
INDUSTRIAL RETAIL -------------------------------------------------------------- ------------------ ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER RENTABLE SQUARE YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES FOOTAGE SUBJECT TO EXPIRATION EXPIRING LEASES EXPIRING LEASES WITH FUTURE STEP-UPS EXPIRING LEASES - ---------------------------------------------- ------------------ ------------------ -------------------- ------------------ 2003.......................................... -- $ -- $ -- -- 2004.......................................... -- -- -- 2,904 2005.......................................... -- -- -- -- 2006.......................................... -- -- -- -- 2007.......................................... -- -- -- -- 2008.......................................... -- -- -- -- 2009.......................................... -- -- -- -- 2010.......................................... -- -- -- -- 2011.......................................... -- -- -- -- 2012.......................................... -- -- -- -- Thereafter.................................... -- -- -- -- RETAIL ----------------------------------------- ANNUALIZED CURRENT ANNUALIZED REVENUES UNDER YEAR OF LEASE REVENUES UNDER EXPIRING LEASES EXPIRATION EXPIRING LEASES WITH FUTURE STEP-UPS - ---------------------------------------------- ------------------ -------------------- 2003.......................................... $ -- $ -- 2004.......................................... 48,000 48,000 2005.......................................... -- -- 2006.......................................... -- -- 2007.......................................... -- -- 2008.......................................... -- -- 2009.......................................... -- -- 2010.......................................... -- -- 2011.......................................... -- -- 2012.......................................... -- -- Thereafter.................................... -- -- BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 IN-SERVICE PRINCETON/EAST BRUNSWICK PROPERTIES QUARTERLY LEASE EXPIRATIONS--PRINCETON/EAST BRUNSWICK
OFFICE OFFICE/TECHNICAL -------------------------------------------------------------- ------------------ ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER RENTABLE SQUARE YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES FOOTAGE SUBJECT TO EXPIRATION EXPIRING LEASES EXPIRING LEASES WITH FUTURE STEP-UPS EXPIRING LEASES - ---------------------------------------------- ------------------ ------------------ -------------------- ------------------ Q1 2003....................................... 11,952 $ 478,634 $ 478,634 -- Q2 2003....................................... 2,242 70,927 70,927 -- Q3 2003....................................... 11,302 309,629 309,629 -- Q4 2003....................................... 71,697 1,928,908 1,928,908 -- ----------- ------------ ----------- ----------- Total 2003.................................... 97,193 2,788,097 2,788,097 -- =========== ============ =========== =========== Q1 2004....................................... 15,570 452,936 452,936 -- Q2 2004....................................... 54,636 1,507,852 1,507,852 -- Q3 2004....................................... 121,054 3,614,735 3,614,735 -- Q4 2004....................................... 219,620 6,509,804 6,532,727 -- ----------- ------------ ----------- ----------- Total 2004.................................... 410,880 12,085,326 12,108,249 -- =========== ============ =========== =========== OFFICE/TECHNICAL ----------------------------------------- ANNUALIZED CURRENT ANNUALIZED REVENUES UNDER YEAR OF LEASE REVENUES UNDER EXPIRING LEASES EXPIRATION EXPIRING LEASES WITH FUTURE STEP-UPS - ---------------------------------------------- ------------------ -------------------- Q1 2003....................................... $ -- $ -- Q2 2003....................................... -- -- Q3 2003....................................... -- -- Q4 2003....................................... -- -- ----------- ----------- Total 2003.................................... -- -- =========== =========== Q1 2004....................................... -- -- Q2 2004....................................... -- -- Q3 2004....................................... -- -- Q4 2004....................................... -- -- ----------- ----------- Total 2004.................................... -- -- =========== =========== 39
INDUSTRIAL RETAIL -------------------------------------------------------------- ------------------ ANNUALIZED RENTABLE SQUARE CURRENT ANNUALIZED REVENUES UNDER RENTABLE SQUARE YEAR OF LEASE FOOTAGE SUBJECT TO REVENUES UNDER EXPIRING LEASES FOOTAGE SUBJECT TO EXPIRATION EXPIRING LEASES EXPIRING LEASES WITH FUTURE STEP-UPS EXPIRING LEASES - ---------------------------------------------- ------------------ ------------------ -------------------- ------------------ Q1 2003....................................... -- $ -- $ -- -- Q2 2003....................................... -- -- -- -- Q3 2003....................................... -- -- -- -- Q4 2003....................................... -- -- -- -- ----------- ------------ ----------- ----------- Total 2003.................................... -- -- -- -- =========== ============ =========== =========== Q1 2004....................................... -- -- -- -- Q2 2004....................................... -- -- -- -- Q3 2004....................................... -- -- -- -- Q4 2004....................................... -- -- -- 2,904 ----------- ------------ ----------- ----------- Total 2004.................................... -- -- -- 2,904 =========== ============ =========== =========== RETAIL ----------------------------------------- ANNUALIZED CURRENT ANNUALIZED REVENUES UNDER YEAR OF LEASE REVENUES UNDER EXPIRING LEASES EXPIRATION EXPIRING LEASES WITH FUTURE STEP-UPS - ---------------------------------------------- ------------------ -------------------- Q1 2003....................................... $ -- $ -- Q2 2003....................................... -- -- Q3 2003....................................... -- -- Q4 2003....................................... -- -- ----------- ----------- Total 2003.................................... -- -- =========== =========== Q1 2004....................................... -- -- Q2 2004....................................... -- -- Q3 2004....................................... -- -- Q4 2004....................................... 48,000 48,000 ----------- ----------- Total 2004.................................... 48,000 48,000 =========== =========== Exhibit 99.1 BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 IN-SERVICE OTHER PROPERTIES LEASE EXPIRATIONS OTHER PROPERTIES (RICHMOND, VA, BALTIMORE, MD, BUCKS COUNTY, PA)
OFFICE OFFICE/TECHNICAL -------------------------------------------------------- ---------------- ANNUALIZED CURRENT REVENUES RENTABLE RENTABLE SQUARE ANNUALIZED UNDER SQUARE FOOTAGE SUBJECT REVENUES UNDER EXPIRING LEASES FOOTAGE YEAR OF LEASE TO EXPIRING EXPIRING WITH FUTURE SUBJECT TO EXPIRATION LEASES LEASES STEP-UPS EXPIRING LEASES - ----------------------------------------------- ----------------- ----------------- ---------------- ---------------- 2003........................................... 166,351 $3,604,208 $3,621,338 -- 2004........................................... 126,279 2,732,068 2,792,412 -- 2005........................................... 392,665 9,689,327 10,099,531 -- 2006........................................... 725,299 20,759,971 21,637,011 -- 2007........................................... 89,093 2,794,473 2,911,429 -- 2008........................................... 207,959 3,902,018 4,603,968 -- 2009........................................... 127,720 2,561,948 3,072,317 -- 2010........................................... 28,840 609,797 727,629 -- 2011........................................... 4,618 119,131 136,679 -- 2012........................................... 30,566 955,188 1,219,278 -- Thereafter..................................... 4,660 103,154 145,251 -- OFFICE/TECHNICAL ------------------------------------- ANNUALIZED REVENUES CURRENT UNDER ANNUALIZED EXPIRING LEASES YEAR OF LEASE REVENUES UNDER WITH FUTURE EXPIRATION EXPIRING LEASES STEP-UPS - ----------------------------------------------- ------------------ ---------------- 2003........................................... $ -- $ -- 2004........................................... -- -- 2005........................................... -- -- 2006........................................... -- -- 2007........................................... -- -- 2008........................................... -- -- 2009........................................... -- -- 2010........................................... -- -- 2011........................................... -- -- 2012........................................... -- -- Thereafter..................................... -- -- 40
INDUSTRIAL RETAIL -------------------------------------------------------- ---------------- ANNUALIZED CURRENT REVENUES RENTABLE RENTABLE SQUARE ANNUALIZED UNDER SQUARE FOOTAGE SUBJECT REVENUES UNDER EXPIRING LEASES FOOTAGE YEAR OF LEASE TO EXPIRING EXPIRING WITH FUTURE SUBJECT TO EXPIRATION LEASES LEASES STEP-UPS EXPIRING LEASES - ----------------------------------------------- ----------------- ----------------- ---------------- ---------------- 2003........................................... -- $ -- $ -- -- 2004........................................... 161,000 771,048 771,048 -- 2005........................................... -- -- -- -- 2006........................................... -- -- -- 6,840 2007........................................... -- -- -- 12,410 2008........................................... -- -- -- -- 2009........................................... -- -- -- -- 2010........................................... -- -- -- 625 2011........................................... -- -- -- -- 2012........................................... -- -- -- 1,400 Thereafter..................................... -- -- -- 2,515 RETAIL ------------------------------------- ANNUALIZED REVENUES CURRENT UNDER ANNUALIZED EXPIRING LEASES YEAR OF LEASE REVENUES UNDER WITH FUTURE EXPIRATION EXPIRING LEASES STEP-UPS - ----------------------------------------------- ------------------ ---------------- 2003........................................... $ -- $ -- 2004........................................... 4,376 4,595 2005........................................... -- -- 2006........................................... 228,633 228,633 2007........................................... 255,491 286,130 2008........................................... -- -- 2009........................................... -- -- 2010........................................... 14,754 19,135 2011........................................... -- -- 2012........................................... 12,100 13,884 Thereafter..................................... 56,613 67,704 BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 IN-SERVICE OTHER PROPERTIES QUARTERLY LEASE EXPIRATIONS OTHER PROPERTIES (RICHMOND, VA, BALTIMORE, MD, BUCKS COUNTY, PA)
OFFICE OFFICE/TECHNICAL -------------------------------------------------------- ---------------- ANNUALIZED CURRENT REVENUES RENTABLE RENTABLE SQUARE ANNUALIZED UNDER SQUARE FOOTAGE SUBJECT REVENUES UNDER EXPIRING LEASES FOOTAGE YEAR OF LEASE TO EXPIRING EXPIRING WITH FUTURE SUBJECT TO EXPIRATION LEASES LEASES STEP-UPS EXPIRING LEASES - ----------------------------------------------- ----------------- ----------------- ---------------- ---------------- Q1 2003........................................ 36,777 $ 570,759 $ 570,759 -- Q2 2003........................................ 28,654 675,424 678,180 -- Q3 2003........................................ 22,240 466,368 475,442 -- Q4 2003........................................ 78,680 1,891,657 1,896,957 -- ------- ---------- ---------- ------- Total 2003..................................... 166,351 3,604,208 3,621,338 -- ======= ========== ========== ======= Q1 2004........................................ -- -- -- -- Q2 2004........................................ 12,935 372,623 382,913 -- Q3 2004........................................ 84,197 1,774,732 1,816,633 -- Q4 2004........................................ 29,147 584,713 592,866 -- ------- ---------- ---------- ------- Total 2004..................................... 126,279 2,732,068 2,792,412 -- ======= ========== ========== ======= OFFICE/TECHNICAL ------------------------------------- ANNUALIZED REVENUES CURRENT UNDER ANNUALIZED EXPIRING LEASES YEAR OF LEASE REVENUES UNDER WITH FUTURE EXPIRATION EXPIRING LEASES STEP-UPS - ----------------------------------------------- ------------------ ---------------- Q1 2003........................................ $ -- $ -- Q2 2003........................................ -- -- Q3 2003........................................ -- -- Q4 2003........................................ -- -- -------- -------- Total 2003..................................... -- -- ======== ======== Q1 2004........................................ -- -- Q2 2004........................................ -- -- Q3 2004........................................ -- -- Q4 2004........................................ -- -- -------- -------- Total 2004..................................... -- -- ======== ======== 41
INDUSTRIAL RETAIL -------------------------------------------------------- ---------------- ANNUALIZED CURRENT REVENUES RENTABLE RENTABLE SQUARE ANNUALIZED UNDER SQUARE FOOTAGE SUBJECT REVENUES UNDER EXPIRING LEASES FOOTAGE YEAR OF LEASE TO EXPIRING EXPIRING WITH FUTURE SUBJECT TO EXPIRATION LEASES LEASES STEP-UPS EXPIRING LEASES - ----------------------------------------------- ----------------- ----------------- ---------------- ---------------- Q1 2003........................................ -- $ -- $ -- -- Q2 2003........................................ -- -- -- -- Q3 2003........................................ -- -- -- -- Q4 2003........................................ -- -- -- -- ------- ---------- ---------- ------- Total 2003..................................... -- -- -- -- ======= ========== ========== ======= Q1 2004........................................ -- -- -- -- Q2 2004........................................ 161,000 771,048 771,048 -- Q3 2004........................................ -- -- -- -- Q4 2004........................................ -- -- -- -- ------- ---------- ---------- ------- Total 2004..................................... 161,000 771,048 771,048 -- ======= ========== ========== ======= RETAIL ------------------------------------- ANNUALIZED REVENUES CURRENT UNDER ANNUALIZED EXPIRING LEASES YEAR OF LEASE REVENUES UNDER WITH FUTURE EXPIRATION EXPIRING LEASES STEP-UPS - ----------------------------------------------- ------------------ ---------------- Q1 2003........................................ $ -- $ -- Q2 2003........................................ -- -- Q3 2003........................................ -- -- Q4 2003........................................ -- -- -------- -------- Total 2003..................................... -- -- ======== ======== Q1 2004........................................ -- -- Q2 2004........................................ -- -- Q3 2004........................................ 4,376 4,595 Q4 2004........................................ -- -- -------- -------- Total 2004..................................... 4,376 4,595 ======== ======== BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 CBD PROPERTIES LEASE EXPIRATIONS
GREATER BOSTON --------------------------------------------------------- CURRENT RENTABLE SQUARE ANNUALIZED FOOTAGE SUBJECT REVENUES UNDER YEAR OF LEASE TO EXPIRING EXPIRING EXPIRATION LEASES LEASES - ------------------------------------------------------------ ---------------------------- -------------------------- 2003........................................................ 95,909 $ 7,500,094 2004........................................................ 370,813 18,435,042 2005........................................................ 600,418 26,621,706 2006........................................................ 168,144 8,290,279 2007........................................................ 153,050 7,901,808 2008........................................................ 48,441 1,942,903 2009........................................................ 661,277 23,458,347 2010........................................................ 150,555 6,295,349 2011........................................................ 434,991 20,675,404 2012........................................................ 311,152 12,716,483 Thereafter.................................................. 823,076 27,925,502 GREATER BOSTON -------------------------- ANNUALIZED REVENUES UNDER EXPIRING LEASES YEAR OF LEASE WITH FUTURE EXPIRATION STEP-UPS - ------------------------------------------------------------ -------------------------- 2003........................................................ $ 7,593,263 2004........................................................ 18,709,101 2005........................................................ 27,215,015 2006........................................................ 8,370,737 2007........................................................ 8,131,713 2008........................................................ 2,041,423 2009........................................................ 26,233,054 2010........................................................ 7,041,334 2011........................................................ 24,886,207 2012........................................................ 14,402,774 Thereafter.................................................. 38,349,465 GREATER WASHINGTON ----------------------------------------------------------- ANNUALIZED RENTABLE REVENUES SQUARE CURRENT UNDER FOOTAGE ANNUALIZED EXPIRING LEASES YEAR OF LEASE SUBJECT TO REVENUES UNDER WITH FUTURE EXPIRATION EXPIRING LEASES EXPIRING LEASES STEP-UPS - ------------------------------------------------------------ ----------------- --------------- --------------------- 2003........................................................ 28,560 $ 1,031,220 $ 1,049,214 2004........................................................ 146,226 5,960,464 6,121,736 2005........................................................ 244,420 9,657,433 10,282,667 2006........................................................ 46,501 1,756,204 1,843,219 2007........................................................ 323,690 11,025,868 11,363,094 2008........................................................ 31,917 1,163,449 1,339,836 2009........................................................ 433,461 14,935,714 16,426,140 2010........................................................ 390,991 15,283,955 17,863,223 2011........................................................ 190,472 7,178,379 8,594,548 2012........................................................ 77,318 2,849,470 2,868,603 Thereafter.................................................. 387,544 17,122,179 19,654,379
NEW YORK --------------------------------------------------------- CURRENT RENTABLE SQUARE ANNUALIZED FOOTAGE SUBJECT REVENUES UNDER YEAR OF LEASE TO EXPIRING EXPIRING EXPIRATION LEASES LEASES - ------------------------------------------------------------ ---------------------------- -------------------------- 2003........................................................ 123,835 $ 5,839,962 2004........................................................ 168,523 9,582,366 2005........................................................ 116,521 7,526,782 2006........................................................ 499,016 30,923,615 2007........................................................ 208,433 12,689,846 2008........................................................ 465,627 25,879,035 2009........................................................ 250,804 13,998,636 2010........................................................ 273,228 17,097,459 2011........................................................ 405,569 23,410,474 2012........................................................ 945,358 53,455,509 Thereafter.................................................. 3,678,057 221,254,950 NEW YORK -------------------------- ANNUALIZED REVENUES UNDER EXPIRING LEASES YEAR OF LEASE WITH FUTURE EXPIRATION STEP-UPS - ------------------------------------------------------------ -------------------------- 2003........................................................ $ 5,839,962 2004........................................................ 9,606,724 2005........................................................ 7,578,821 2006........................................................ 31,379,193 2007........................................................ 12,857,003 2008........................................................ 27,746,933 2009........................................................ 16,022,270 2010........................................................ 18,181,146 2011........................................................ 27,115,114 2012........................................................ 55,975,865 Thereafter.................................................. 268,858,937 SAN FRANCISCO -------------------------------------------------------------- ANNUALIZED RENTABLE REVENUES SQUARE CURRENT UNDER FOOTAGE ANNUALIZED EXPIRING LEASES YEAR OF LEASE SUBJECT TO REVENUES UNDER WITH FUTURE EXPIRATION EXPIRING LEASES EXPIRING LEASES STEP-UPS - ------------------------------------------------------------ --------------- --------------- -------------------------- 2003........................................................ 244,475 $10,771,621 $10,789,838 2004........................................................ 562,363 26,023,160 25,817,934 2005........................................................ 324,131 14,796,662 14,828,701 2006........................................................ 894,253 43,568,718 45,035,971 2007........................................................ 436,833 21,123,483 22,130,396 2008........................................................ 179,577 7,712,202 8,076,297 2009........................................................ 284,054 12,412,124 13,164,743 2010........................................................ 203,968 11,888,997 13,878,211 2011........................................................ 196,163 18,167,551 18,693,073 2012........................................................ 162,700 7,275,276 8,104,263 Thereafter.................................................. 151,805 6,743,377 7,181,587 42
NEW JERSEY --------------------------------------------------------- CURRENT RENTABLE SQUARE ANNUALIZED FOOTAGE SUBJECT REVENUES UNDER YEAR OF LEASE TO EXPIRING EXPIRING EXPIRATION LEASES LEASES - ------------------------------------------------------------ ---------------------------- -------------------------- 2003........................................................ -- $ -- 2004........................................................ -- -- 2005........................................................ -- -- 2006........................................................ -- -- 2007........................................................ -- -- 2008........................................................ -- -- 2009........................................................ -- -- 2010........................................................ -- -- 2011........................................................ -- -- 2012........................................................ -- -- Thereafter.................................................. -- -- NEW JERSEY -------------------------- ANNUALIZED REVENUES UNDER EXPIRING LEASES YEAR OF LEASE WITH FUTURE EXPIRATION STEP-UPS - ------------------------------------------------------------ -------------------------- 2003........................................................ $ -- 2004........................................................ -- 2005........................................................ -- 2006........................................................ -- 2007........................................................ -- 2008........................................................ -- 2009........................................................ -- 2010........................................................ -- 2011........................................................ -- 2012........................................................ -- Thereafter.................................................. -- OTHER -------------------------------------------------------------- ANNUALIZED RENTABLE REVENUES SQUARE CURRENT UNDER FOOTAGE ANNUALIZED EXPIRING LEASES YEAR OF LEASE SUBJECT TO REVENUES UNDER WITH FUTURE EXPIRATION EXPIRING LEASES EXPIRING LEASES STEP-UPS - ------------------------------------------------------------ --------------- --------------- -------------------------- 2003........................................................ 166,351 $ 3,612,929 $ 3,630,059 2004........................................................ 126,279 2,736,444 2,797,006 2005........................................................ 392,665 9,689,327 10,099,531 2006........................................................ 732,139 20,988,604 21,865,644 2007........................................................ 101,503 3,049,964 3,197,560 2008........................................................ 209,420 3,922,472 4,630,266 2009........................................................ 127,720 2,561,948 3,072,317 2010........................................................ 29,465 624,551 746,765 2011........................................................ 4,618 119,131 136,679 2012........................................................ 31,966 967,287 1,233,162 Thereafter.................................................. 7,175 159,767 212,955 BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 SUBURBAN PROPERTIES LEASE EXPIRATIONS
GREATER BOSTON --------------------------------------------------------- CURRENT RENTABLE SQUARE ANNUALIZED FOOTAGE SUBJECT REVENUES UNDER YEAR OF LEASE TO EXPIRING EXPIRING EXPIRATION LEASES LEASES - ------------------------------------------------------------ ---------------------------- -------------------------- 2003........................................................ 383,879 $ 7,427,981 2004........................................................ 363,637 11,261,584 2005........................................................ 317,448 9,763,398 2006........................................................ 673,322 16,992,282 2007........................................................ 377,644 10,221,655 2008........................................................ 82,604 2,527,965 2009........................................................ 283,195 10,401,977 2010........................................................ 56,901 1,904,522 2011........................................................ 419,343 8,149,050 2012........................................................ 418,093 11,698,987 Thereafter.................................................. 194,224 6,766,109 GREATER BOSTON -------------------------- ANNUALIZED REVENUES UNDER EXPIRING LEASES YEAR OF LEASE WITH FUTURE EXPIRATION STEP-UPS - ------------------------------------------------------------ -------------------------- 2003........................................................ $ 7,511,795 2004........................................................ 11,355,514 2005........................................................ 9,876,035 2006........................................................ 17,652,965 2007........................................................ 11,152,644 2008........................................................ 2,547,320 2009........................................................ 11,082,101 2010........................................................ 2,153,479 2011........................................................ 9,323,894 2012........................................................ 13,367,598 Thereafter.................................................. 8,217,545 GREATER WASHINGTON --------------------------------------------------------------------- ANNUALIZED RENTABLE REVENUES SQUARE CURRENT UNDER FOOTAGE ANNUALIZED EXPIRING LEASES YEAR OF LEASE SUBJECT TO REVENUES UNDER WITH FUTURE EXPIRATION EXPIRING LEASES EXPIRING LEASES STEP-UPS - ------------------------------------------------------------ --------------- ------------------------ ------------------------ 2003........................................................ 194,738 $ 4,131,411 $ 4,145,780 2004........................................................ 150,102 3,575,210 3,670,448 2005........................................................ 357,020 9,447,318 10,049,543 2006........................................................ 418,728 11,205,578 12,011,193 2007........................................................ 517,090 14,058,708 14,438,782 2008........................................................ 408,477 16,428,655 12,986,524 2009........................................................ 261,046 8,116,670 8,116,670 2010........................................................ 217,497 6,290,567 7,455,821 2011........................................................ 940,096 25,927,411 30,794,728 2012........................................................ 240,152 7,772,463 10,369,586 Thereafter.................................................. 785,570 18,032,977 22,278,017
NEW YORK --------------------------------------------------------- CURRENT RENTABLE SQUARE ANNUALIZED FOOTAGE SUBJECT REVENUES UNDER YEAR OF LEASE TO EXPIRING EXPIRING EXPIRATION LEASES LEASES - ------------------------------------------------------------ ---------------------------- -------------------------- 2003........................................................ -- -- 2004........................................................ -- -- 2005........................................................ -- -- 2006........................................................ -- -- 2007........................................................ -- -- 2008........................................................ -- -- 2009........................................................ -- -- 2010........................................................ -- -- 2011........................................................ -- -- 2012........................................................ -- -- Thereafter.................................................. -- -- NEW YORK -------------------------- ANNUALIZED REVENUES UNDER EXPIRING LEASES YEAR OF LEASE WITH FUTURE EXPIRATION STEP-UPS - ------------------------------------------------------------ -------------------------- 2003........................................................ -- 2004........................................................ -- 2005........................................................ -- 2006........................................................ -- 2007........................................................ -- 2008........................................................ -- 2009........................................................ -- 2010........................................................ -- 2011........................................................ -- 2012........................................................ -- Thereafter.................................................. -- SAN FRANCISCO --------------------------------------------------------------------- ANNUALIZED RENTABLE REVENUES SQUARE CURRENT UNDER FOOTAGE ANNUALIZED EXPIRING LEASES YEAR OF LEASE SUBJECT TO REVENUES UNDER WITH FUTURE EXPIRATION EXPIRING LEASES EXPIRING LEASES STEP-UPS - ------------------------------------------------------------ ----------------- ----------------------- ----------------------- 2003........................................................ 309,534 $ 9,750,160 $ 9,755,651 2004........................................................ 96,377 2,314,956 2,360,244 2005........................................................ 100,473 3,138,448 3,624,734 2006........................................................ 42,638 2,296,652 2,618,956 2007........................................................ 42,217 823,224 892,744 2008........................................................ 12,770 292,698 305,866 2009........................................................ 5,256 176,602 211,291 2010........................................................ 7,724 168,000 231,720 2011........................................................ -- -- -- 2012........................................................ -- -- -- Thereafter.................................................. -- -- -- 43
NEW JERSEY --------------------------------------------------------- CURRENT RENTABLE SQUARE ANNUALIZED FOOTAGE SUBJECT REVENUES UNDER YEAR OF LEASE TO EXPIRING EXPIRING EXPIRATION LEASES LEASES - ------------------------------------------------------------ ---------------------------- -------------------------- 2003........................................................ 97,193 $ 2,788,097 2004........................................................ 413,784 12,133,326 2005........................................................ 237,630 7,261,045 2006........................................................ 87,691 2,845,967 2007........................................................ 510,959 13,820,256 2008........................................................ -- -- 2009........................................................ 161,514 4,886,156 2010........................................................ 145,675 4,690,766 2011........................................................ 254,941 7,534,086 2012........................................................ -- -- Thereafter.................................................. 237,429 7,160,772 NEW JERSEY -------------------------- ANNUALIZED REVENUES UNDER EXPIRING LEASES YEAR OF LEASE WITH FUTURE EXPIRATION STEP-UPS - ------------------------------------------------------------ -------------------------- 2003........................................................ $ 2,788,097 2004........................................................ 12,156,249 2005........................................................ 7,350,624 2006........................................................ 2,998,578 2007........................................................ 15,047,700 2008........................................................ -- 2009........................................................ 5,645,940 2010........................................................ 5,105,120 2011........................................................ 8,375,570 2012........................................................ -- Thereafter.................................................. 7,849,057 OTHER -------------------------------------------------------------------- ANNUALIZED RENTABLE REVENUES SQUARE CURRENT UNDER FOOTAGE ANNUALIZED EXPIRING LEASES YEAR OF LEASE SUBJECT TO REVENUES UNDER WITH FUTURE EXPIRATION EXPIRING LEASES EXPIRING LEASES STEP-UPS - ------------------------------------------------------------ ------------------ ------------------ -------------------------- 2003........................................................ -- $ -- $ -- 2004........................................................ 161,000 771,048 771,048 2005........................................................ -- -- -- 2006........................................................ -- -- -- 2007........................................................ -- -- -- 2008........................................................ -- -- -- 2009........................................................ -- -- -- 2010........................................................ -- -- -- 2011........................................................ -- -- -- 2012........................................................ -- -- -- Thereafter.................................................. -- -- -- BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 HOTEL PERFORMANCE LONG WHARF MARRIOTT--BOSTON CAMBRIDGE CENTER MARRIOTT
FOURTH QUARTER FOURTH QUARTER PERCENT YTD 2002 2001 CHANGE 2002 --------------------------- --------------------------- -------------- -------- Occupancy.......................... 78.2% 78.8% -0.8% 82.9% Average Daily Rate................. $217.19 $197.81 9.8% $212.57 REVPAR............................. $169.84 $155.82 9.0% $176.13 NOI (in thousands)................. $ 3,512 $ 2,856 23.0% $11,283 YTD PERCENT 2001 CHANGE -------- -------------- Occupancy.......................... 81.0%(1) 2.3% Average Daily Rate................. $227.42 -6.5% REVPAR............................. $184.21 -4.4% NOI (in thousands)................. $12,301 -8.3% RESIDENCE INN BY MARRIOT
FOURTH QUARTER FOURTH QUARTER PERCENT YTD 2002 2001 CHANGE 2002 --------------------------- --------------------------- -------------- -------- Occupancy.......................... 73.8% 65.6% 12.5% 76.6% Average Daily Rate................. $182.04 $182.81 -0.4% $173.52 REVPAR............................. $134.34 $119.93 12.0% $132.94 NOI (in thousands)................. $ 2,441 $ 1,767 38.1% $ 7,863 YTD PERCENT 2001 CHANGE -------- -------------- Occupancy.......................... 76.7% -0.1% Average Daily Rate................. $191.24 -9.3% REVPAR............................. $146.68 -9.4% NOI (in thousands)................. $9,188 -14.4% TOTAL HOTEL PERFORMANCE
FOURTH QUARTER FOURTH QUARTER PERCENT YTD 2002 2001 CHANGE 2002 --------------------------- --------------------------- -------------- -------- Occupancy.......................... 81.1% 82.9% -2.2% 84.9% Average Daily Rate................. $140.57 $136.39 3.1% $138.77 REVPAR............................. $114.00 $113.07 0.8% $117.87 NOI (in thousands)................. $ 1,374 $ 1,264 8.7% $ 4,238 YTD PERCENT 2001 CHANGE -------- -------------- Occupancy.......................... 87.1% -2.5% Average Daily Rate................. $154.77 -10.3% REVPAR............................. $134.80 -12.6% NOI (in thousands)................. $5,278 -19.7% (1) Room renovation project underway during 2001. 44
FOURTH QUARTER FOURTH QUARTER PERCENT YTD 2002 2001 CHANGE 2002 --------------------------- --------------------------- -------------- -------- Occupancy.......................... 77.0% 74.3% 3.6% 80.7% Average Daily Rate................. $186.75 $178.80 4.4% $181.13 REVPAR............................. $143.62 $132.18 8.7% $146.25 NOI (in thousands)................. $ 7,326 $ 5,887 24.4% $23,384 YTD PERCENT 2001 CHANGE -------- -------------- Occupancy.......................... 80.5% 0.2% Average Daily Rate................. $197.39 -8.2% REVPAR............................. $158.50 -7.7% NOI (in thousands)................. $26,768 -12.6% BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 SAME PROPERTY PERFORMANCE OFFICE, OFFICE/TECHNICAL, INDUSTRIAL AND HOTEL PROPERTIES SAME PROPERTY LEASE ANALYSIS--QUARTER ENDED DECEMBER 31, 2002
OFFICE OFFICE/TECHNICAL INDUSTRIAL HOTEL TOTAL ----------- ---------------------------- ------------------ ---------- ---------- Number of Properties.................. 93 26 4 3 126 Square feet........................... 25,563,322 1,501,391 373,009 937,874 28,375,596 Percent of in-service properties...... 85.4% 90.4% 100.0% 100.0% 86.3% Occupancy @ 12/31/01.................. 95.2% 92.1% 95.6% -- 95.0% Occupancy @ 12/31/02.................. 94.3% 92.5% 100.0% -- 94.3% Percent change from 4th quarter 2002 over 4th quarter 2001 Revenue(1).......................... 2.4% -1.1% -1.8% 13.3% 2.6% Expense............................. 4.9% -6.7% -7.4% -14.5% 4.3% Net Operating Income (1)............ 1.2% 0.5% 0.2% 21.8% 1.9% Net Operating Income--without hotels 1.2% (1)............................... Revenue--cash basis (1)............... 3.7% -1.9% -1.1% 13.5% 3.9% Net Operating Income--cash basis (1)............................... 3.1% -0.5% 1.1% 22.0% 3.6% Net Operating Income--without hotels--cash basis (1).............. 3.0% (1) Does not include termination and early surrender income. (2) Represents increase in net rents on a "cash to cash" basis. (Actual net rent at time of expiration vs. initial net rent of new lease.) 45
OFFICE OFFICE/TECHNICAL INDUSTRIAL TOTAL ----------- ---------------------------- ------------------ ---------- Vacant space available @10/01/02 (sf).............. 1,081,190 76,055 -- 1,157,245 Square footage of leases expiring or terminated 10/01/02-12/31/02............................... 825,132 127,078 23,904 976,114 ---------- ------- ------ --------- Total space for lease (sf)......................... 1,906,322 203,133 23,904 2,133,359 ========== ======= ====== ========= New tenants (sf)................................... 374,366 3,477 -- 377,843 Renewals (sf)...................................... 186,797 86,322 23,904 297,023 ---------- ------- ------ --------- Total space leased (sf)............................ 561,163 89,799 23,904 674,866 ========== ======= ====== ========= Space available @ 12/31/02 (sf).................... 1,345,159 113,334 -- 1,458,493 ========== ======= ====== ========= Net (increase)/decrease in available space (sf).... (263,969) (37,279) -- (301,248) Average lease term (months)........................ 91 115 12 91 2nd generation TI/Comm PSF......................... $ 14.27 $ 0.07 $ -- $ 11.87 Increase (decrease) in 2nd generation net rents (2).............................................. -5.3% 2.0% -- -4.8% BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 PROPERTY PERFORMANCE ALL IN-SERVICE PROPERTIES--QUARTER ENDED DECEMBER 31, 2002 (1) Represents increase in net rents on a "cash to cash" basis (actual net rent at time of expiration vs. initial net rent of new lease). (2) Details of 1st and 2nd Generation Space:
OFFICE OFFICE/TECHNICAL INDUSTRIAL TOTAL ----------- ---------------------------- ------------------ ---------- Vacant space available @ 10/01/02 (sf)............. 1,537,518 76,055 -- 1,613,573 New development sf completed....................... 91,264 -- -- 91,264 Square footage of leases expiring or terminated 10/01/02-12/31/02................................ 829,992 127,078 23,904 980,974 ---------- ------- ------ --------- Total space for lease (sf)......................... 2,458,774 203,133 23,904 2,685,811 ========== ======= ====== ========= New tenants (sf)................................... 434,048 3,477 -- 437,525 Renewals (sf)...................................... 186,797 86,322 23,904 297,023 ---------- ------- ------ --------- Total space leased (sf)............................ 620,845 89,799 23,904 734,548(2) ========== ======= ====== ========= Space available @ 12/31/02 (sf).................... 1,837,929 113,334 -- 1,951,263 ========== ======= ====== ========= Net (increase)/decrease in available space (sf).... (300,411) (37,279) -- (337,690) Average lease term (months)........................ 92 115 12 92 2nd generation TI/Comm PSF......................... $ 14.43 $ 0.07 $ -- $ 12.02 Increase (decrease) in 2nd generation net rents (1).............................................. -4.5% 2.0% -- -4.0% 46
1ST 2ND TOTAL GENERATION GENERATION LEASED -------------- -------------- --------- Boston...................................................... 36,384 111,126 147,510 Washington.................................................. 3,945 183,156 187,101 New York.................................................... 14,513 192,676 207,189 San Francisco............................................... -- 174,781 174,781 Princeton................................................... -- 17,967 17,967 ------ ------- ------- 54,842 679,706 734,548 ====== ======= ======= BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 HISTORICALLY GENERATED CAPITAL EXPENDITURES, TENANT IMPROVEMENT COSTS AND LEASING COMMISSIONS HISTORICAL CAPITAL EXPENDITURES (IN THOUSANDS) 2ND GENERATION TENANT IMPROVEMENTS AND LEASING COMMISSIONS (2) (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
Q4 Q3 Q2 Q1 2002 2002 2002 2002 2001 2000 -------- -------- -------- -------- ---------- ---------- Recurring capital expenditures.............................. $ 5,909 $ 4,266 $ 3,553 $ 2,946 $ 11,770 $ 11,201 Planned non-recurring capital expenditures associated with acquisition properties (1)................................ 7,856 5,320 9,777 8,955 45,052 25,782 Hotel improvements, equipment upgrades and replacements..... 188 394 852 1,784 9,230 5,697 -------- -------- -------- -------- ---------- ---------- $ 13,953 $ 9,980 $ 14,182 $ 13,685 $ 66,052 $ 42,680 ======== ======== ======== ======== ========== ========== (1) Includes budgeted costs associated with the 18.4 million square feet of previously disclosed acquisitions. (2) Based on leases executed during the period. 47
Q4 Q3 Q2 Q1 2002 2002 2002 2002 2001 2000 -------- -------- -------- -------- ---------- ---------- Office Square feet............................................... 566,003 433,722 638,750 483,934 2,394,291 2,913,599 -------- -------- -------- -------- ---------- ---------- Tenant improvement and lease commissions p.s.f............ $ 14.43 $ 18.01 $ 26.18 $ 20.95 $ 17.47 $ 13.82 -------- -------- -------- -------- ---------- ---------- Office/Technical Square feet............................................... 89,799 250,261 6,214 1,047 348,178 694,536 -------- -------- -------- -------- ---------- ---------- Tenant improvement and lease commissions p.s.f............ $ 0.07 $ 1.90 $ 1.68 $ 1.02 $ 3.13 $ 2.95 -------- -------- -------- -------- ---------- ---------- Industrial Square feet............................................... 23,904 -- 221,000 -- -- 209,125 -------- -------- -------- -------- ---------- ---------- Tenant improvement and lease commissions p.s.f............ $ -- $ -- $ 0.68 $ -- $ -- $ 1.38 -------- -------- -------- -------- ---------- ---------- Average tenant improvement and lease commission p.s.f..... $ 12.02 $ 12.11 $ 19.50 $ 20.91 $ 15.65 $ 11.16 ======== ======== ======== ======== ========== ========== BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 VALUE CREATION PIPELINE--ACQUISITIONS/DISPOSITIONS AS OF DECEMBER 31, 2002 ACQUISITIONS DISPOSTIONS
ANTICIPATED DATE SQUARE INITIAL FUTURE PROPERTY ACQUIRED FEET INVESTMENT INVESTMENT - -------- --------------- ------------ ------------------- ------------------- 399 Park Avenue.................... Sep-02 1,677,433 $1,064,000,000 $4,000,000 --------- -------------- ---------- TOTAL VALUE CREATION PIPELINE--ACQUISITIONS......... 1,677,433 $1,064,000,000 $4,000,000 ========= ============== ========== TOTAL CURRENT PROPERTY INVESTMENT OCCUPANCY - -------- ------------------- ------------------ 399 Park Avenue.................... $1,068,000,000 100% -------------- ---- TOTAL VALUE CREATION PIPELINE--ACQUISITIONS......... $1,068,000,000 100% ============== ==== (1) Gains recognized for accounting purposes during Q3 2002. 48
DATE GROSS PROPERTY DISPOSED SQUARE FEET SALES PRICE BOOK GAIN - -------- --------------- -------------------- ------------------- ----------------- Fullerton Square............................... Mar-02 179,453 $ 22,525,000 $ 7,145,500 7600 Boston Boulevard.......................... Mar-02 69,832 8,627,000 5,597,132(1) 7700 Boston Boulevard.......................... Mar-02 82,224 16,558,000 6,024,563(1) 7702 Boston Boulevard.......................... Mar-02 43,171 8,916,000 2,758,255(1) 681 Gateway--Land.............................. Jul-02 N/A 8,000,000 3,278,659 Herndon Lumber Site--Land...................... Jul-02 N/A 5,200,000 1,152,784 Belvidere garage spaces........................ Sep-02 N/A 1,305,000 103,030 Belvidere garage spaces........................ Oct-02 N/A 1,035,000 81,715 One and Two Independence Square................ Nov-02 917,459 345,000,000 227,791,468 2391 West Winton Avenue........................ Dec-02 220,213 10,800,000 9,288,323 --------- ------------ ------------ TOTAL DISPOSITIONS............................. 1,512,352 $427,966,000 $263,221,429 ========= ============ ============ BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 VALUE CREATION PIPELINE--CONSTRUCTION IN PROGRESS AS OF DECEMBER 31, 2002 DEVELOPMENTS PLACED-IN-SERVICE DURING 2002
DEVELOPMENT INITIAL STABILIZATION # OF PROPERTIES OCCUPANCY DATE LOCATION BUILDINGS - ----------- --------------- ------------------- ---------------- -------------- Shaws Supermarket.......................... Q2 2003 Q2 2003 Boston, MA 1 Waltham Weston Corporate Center............ Q1 2002 Q4 2003 Waltham, MA 1 New Dominion Tech, Building Two............ Q2 2004 Q2 2004 Herndon, VA 1 Two Freedom Square (50% ownership)......... Q3 2002 Q3 2004 Reston, VA 1 Times Square Tower......................... Q1 2004 Q1 2005 New York, NY 1 901 New York Avenue (25% ownership)........ Q3 2004 Q3 2005 Washington, D.C. 1 --- TOTAL DEVELOPMENT PROPERTIES................. 6 === ANTICIPATED TOTAL DEVELOPMENT SQUARE INVESTMENT TOTAL CONSTRUCTION PROPERTIES FEET TO DATE INVESTMENT(1) LOAN - ----------- ---------- ---------------- ------------------- -------------------- Shaws Supermarket.......................... 57,235 21,723,021 24,034,000 24,000,000 Waltham Weston Corporate Center............ 304,050 67,711,099 85,000,000 45,000,000 New Dominion Tech, Building Two............ 257,400 9,434,333 67,589,000 65,000,000 Two Freedom Square (50% ownership)......... 422,930 39,181,217 49,336,000(2) 45,000,000(2) Times Square Tower......................... 1,218,511 366,247,753 653,500,000 493,500,000 901 New York Avenue (25% ownership)........ 538,463 14,004,503 44,777,250 30,000,000 --------- ------------ ------------ ------------ TOTAL DEVELOPMENT PROPERTIES................. 2,798,589 $518,301,926 $924,236,250 $702,500,000 ========= ============ ============ ============ AMOUNT DRAWN AT CURRENT DEVELOPMENT DECEMBER 31, FUTURE EQUITY PERCENTAGE PROPERTIES 2002 REQUIREMENT LEASED - ----------- ------------------ -------------------- ----------------- Shaws Supermarket.......................... 20,716,660 -- 100% Waltham Weston Corporate Center............ 44,839,890 17,128,791 42% New Dominion Tech, Building Two............ 7,558,424 713,091 100% Two Freedom Square (50% ownership)......... 32,853,493 -- 65% Times Square Tower......................... 222,196,210 15,948,457 0% 901 New York Avenue (25% ownership)........ 2,642,575 3,415,322 60% ------------ ----------- --- TOTAL DEVELOPMENT PROPERTIES................. $330,807,252 $37,205,661 37% ============ =========== === (1) Includes net revenues during lease-up period and cash component of hedge contracts. (2) Represents 50% of the total anticipated project-level investment and construction loan. 49
INITIAL IN-SERVICE STABILIZATION # OF DATE DATE LOCATION BUILDINGS --------------- ------------------- ---------------- -------------- CLASS A OFFICE BUILDING One and Two Discovery Square (50% ownership)....... Q1/Q2 2002 Q1 2002/Q1 2003 Reston, VA 2 ITT Educational Services........................... Q1 2002 Q1 2002 Springfield, VA 1 5 Times Square..................................... Q1 2002 Q1 2002 New York, NY 1 111 Huntington Avenue--Prudential Center........... Q3 2001 Q2 2002 Boston, MA 1 111 Huntington Avenue--retail...................... Q3 2001 Q1 2003 Boston, MA -- Broad Run Business Park- Building E................ Q2 2002 Q2 2003 Dulles, VA 1 611 Gateway Boulevard.............................. Q3 2003 Q4 2005 S. San Francisco, CA 1 --- TOTAL DEVELOPMENTS PLACED IN SERVICE................. 7 === SQUARE INVESTMENT TOTAL CONSTRUCTION FEET TO DATE INVESTMENT LOAN ---------- ---------------- ---------------- -------------------- CLASS A OFFICE BUILDING One and Two Discovery Square (50% ownership)....... 366,989 $ 36,437,265 $ 41,204,000 $ 37,500,000 ITT Educational Services........................... 32,000 5,480,445 5,740,000 -- 5 Times Square..................................... 1,103,290 501,644,212 536,115,000 420,000,000 111 Huntington Avenue--Prudential Center........... 854,129 305,014,774 290,000,000 203,000,000 111 Huntington Avenue--retail...................... 92,935 -- n/a -- Broad Run Business Park- Building E................ 127,226 14,395,599 19,946,000 -- 611 Gateway Boulevard.............................. 250,825 60,989,068 81,221,000 -- --------- ------------ ------------ ------------ TOTAL DEVELOPMENTS PLACED IN SERVICE................. 2,827,394 $923,961,363 $974,226,000 $660,500,000 ========= ============ ============ ============ DRAWN AT DECEMBER 31, FUTURE EQUITY PERCENTAGE 2002 REQUIREMENT LEASED ------------------ -------------------- ----------------- CLASS A OFFICE BUILDING One and Two Discovery Square (50% ownership)....... $ 30,949,380 -- 91% ITT Educational Services........................... -- 259,555 100% 5 Times Square..................................... 372,904,665 -- 100% 111 Huntington Avenue--Prudential Center........... 203,000,000 -- 98% 111 Huntington Avenue--retail...................... -- -- 100% Broad Run Business Park- Building E................ -- 5,550,401 55% 611 Gateway Boulevard.............................. -- 20,231,932 0% ------------ ----------- --- TOTAL DEVELOPMENTS PLACED IN SERVICE................. $606,854,045 $26,041,888 87% ============ =========== === BOSTON PROPERTIES, INC. FOURTH QUARTER 2002 VALUE CREATION PIPELINE--OWNED LAND PARCELS AS OF DECEMBER 31, 2002 VALUE CREATION PIPELINE--LAND PURCHASE OPTIONS AS OF DECEMBER 31, 2002
NO. OF DEVELOPABLE LOCATION PARCELS ACREAGE SQUARE FEET - -------- ------------- -------------- --------------------- Rockville, MD............................................... 4 92.3 986,000 Dulles, VA.................................................. 2 76.6 937,000 Gaithersburg, MD............................................ 4 27.0 850,000 San Jose, CA................................................ 5 3.7 841,000 Reston, VA.................................................. 3 26.7 861,000 Boston, MA.................................................. 2 0.5 776,000 Marlborough, MA............................................. 1 50.0 400,000 Weston, MA.................................................. 1 74.0 350,000 Waltham, MA................................................. 1 4.3 202,000 Andover, MA................................................. 1 10.0 110,000 Washington, D.C............................................. 1 0.5 170,000 -- ----- --------- 25 365.6 6,483,000 == ===== ========= (1) $20.00/FAR plus an earnout calculation. (2) Subject to ground lease. (3) Prior to January 23, 2003 the cost will be $27.72/SF of land area. Land area is approximately 108,000 SF. 50
NO. OF DEVELOPABLE LOCATION PARCELS ACREAGE SQUARE FEET - -------- ------------- -------------- --------------------- Princeton, NJ (1)........................................... 14 149.9 1,900,000 Framingham, MA (2).......................................... 1 21.5 300,000 Cambridge, MA (3)........................................... 1 2.6 165,000 -- ----- --------- 16 174.0 2,365,000 == ===== =========
Exhibit 99.2 [LOGO] BOSTON PROPERTIES, INC. 111 HUNTINGTON AVENUE BOSTON, MA 02199 (NYSE: BXP) AT THE COMPANY AT FRB/WEBER SHANDWICK Douglas T. Linde Marilynn Meek - General Info. (212) 445-8431 Chief Financial Officer Suzie Pileggi - Media (212) 445-8170 (617) 236-3300 BOSTON PROPERTIES, INC. ANNOUNCES FOURTH QUARTER 2002 RESULTS REPORTS DILUTED FFO PER SHARE OF $1.14 REPORTS DILUTED EPS OF $2.70 BOSTON, MA, JANUARY 21, 2003 - BOSTON PROPERTIES, INC. (NYSE: BXP), a real estate investment trust, today reported results for the fourth quarter ended December 31, 2002. Funds from Operations (FFO) for the quarter ended December 31, 2002 were $113.5 million, or $1.19 per share basic and $1.14 per share diluted before an accounting charge related to the application of SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities". FFO for the fourth quarter of 2002 compares to FFO of $90.7 million, or $1.00 per share basic and $0.95 per share diluted for the quarter ended December 31, 2001. This represents a 20.0% quarter to quarter increase in diluted FFO per share. The weighted average number of basic and diluted shares outstanding totaled 95,313,371 and 105,630,130, respectively, for the quarter ended December 31, 2002 and 90,736,578 and 105,577,393, respectively, for the same quarter last year. FFO for the year ended December 31, 2002 were $399.5 million, or $4.29 per share basic and $4.09 per share diluted. FFO for the year ended 2002 compares to FFO of $337.8 million, or $3.75 per share basic and $3.57 per share diluted for the year ended December 31, 2001. This represents a 14.6% year to year increase in diluted FFO per share. The weighted average number of basic and diluted shares outstanding totaled 93,144,747 and 105,799,277, respectively, for the year ended December 31, 2002 and 90,001,534 and 105,185,427, respectively, for last year. Net income available to common shareholders per share (EPS) for the quarter ended December 31, 2002 was $2.70 on a diluted basis. This includes $2.03 per share, on a diluted basis, related to gains on sales of properties. EPS for the fourth quarter 2001 was $0.60 on a diluted basis. This includes $0.03 per share, on a diluted basis, related to gains on sales of properties. Excluding the gains on sales of properties this represents a 17.5% quarter to quarter increase in diluted EPS. Net income available to common shareholders per share (EPS) for the year ended December 31, 2002 was $4.66 on a diluted basis. This includes $2.28 per share, on a diluted basis, relates to gains on sales of properties. EPS for 2001 was $2.19 on a diluted basis. This includes $0.10 per share, on a diluted basis, related to gains on sales of properties. Excluding the gains on sales of properties this represents a 13.9% year to year increase in diluted EPS. The reported results are unaudited and there can be no assurance that the results will not vary from the final information for the quarter and year ended December 31, 2002. In the opinion of management, all adjustments considered necessary for a fair presentation of these reported results have been made. As of December 31, 2002, the Company's portfolio consisted of 142 properties comprising more than 42.4 million square feet, including six properties under development totaling 2.8 million square feet. The overall occupancy rate for the properties in service as of December 31, 2002 was 93.9%. Significant events of the fourth quarter include: o The Company's Operating Partnership closed a private offering under Rule 144A of $750.0 million in aggregate principal amount of its 6.25% senior unsecured notes due 2013. The notes were priced at 99.65% of their face amount to yield 6.296%. The Company used the net proceeds to pay down its unsecured bridge loan incurred in connection with the acquisition of 399 Park Avenue in September 2002. o The Company's Operating Partnership received ratings on its inaugural offering of senior unsecured notes of: Moody's Baa2 (stable) Standard & Poor's BBB (stable) FitchRatings BBB (stable) o The Company sold One and Two Independence Square, comprised of two Class A office properties consisting of approximately 900,000 square feet located in Washington, D.C. for $345.0 million. The Company used the net proceeds to repay mortgage financing related to these properties totaling approximately $189.1 million and to pay down its unsecured bridge loan. The Company will continue to manage these properties under an agreement with the buyer. o The Company executed a binding contract for the sale of 875 Third Avenue, a Class A office property totaling approximately 719,000 square feet in midtown Manhattan for $370.1 million. The buyer paid a non-refundable deposit of $20.0 million and waived further due diligence review. The sale is subject to the satisfaction of customary closing conditions and, although there can be no assurances that the sale will be consummated, we have no reason to believe that the closing will not occur as expected by February 2003. o The Company sold 2391 West Winton Avenue, an industrial property totaling approximately 220,000 square feet located in Hayward, CA for $10.8 million. The Company used the net proceeds to pay down its unsecured bridge loan. o The Company placed-in-service the following development projects: Two Discovery Square, a 184,487 square foot office property in Reston, Virginia and Broad Run Business Park Building E, a 127,226 square foot office/technical property in Dulles, Virginia. These projects are 82% and 55% leased, respectively. o The Company refinanced its first mortgage totaling approximately $146.9 million secured by 875 Third Avenue in New York City. o The Company obtained construction financing totaling $65.0 million for its New Dominion Technology Park, Building Two development project in Herndon, Virginia. o The Company obtained construction financing totaling $120.0 million for its development of 901 New York Avenue in Washington, D.C., a joint venture in which the Company has a 25% interest. o The Company repaid a $0.4 million mortgage secured by 201 Carnegie Center in Princeton, New Jersey. o The Company amended its construction loan on the Waltham Weston Corporate Center which reduced the loan commitment from $70.0 million to $45.0 million. In connection with the amendment, $9.9 million was repaid to reduce the amount outstanding to $45.0 million. o The Company exercised a one-year extension option on its 2600 Tower Oaks $30 million construction loan facility. The Company has an additional one-year option. Transactions completed subsequent to December 31, 2002: o The Company's Operating Partnership closed a private offering under Rule 144A of an additional $175.0 million in aggregate principal amount of its 6.25% senior unsecured notes due 2013. The notes were priced at 99.763% of their face amount to yield 6.28%. o In connection with the above transaction, the Company used the net proceeds to pay off its unsecured bridge loan incurred in connection with the acquisition of 399 Park Avenue in September 2002 and to repay in full its construction loans secured by Quorum Office Park, Orbital Sciences, Phase II and 302 Carnegie Center. The total amounts repaid were approximately $165.6 million. o The Company extended its $605.0 million unsecured revolving credit agreement for a three-year term expiring on January 17, 2006 with a one-year extension provision. The interest rate on borrowings has been reduced from Libor + 1.45% to Libor + 0.70%. o The Company executed a binding contract for the sale of the Candler Building, a Class A office property totaling approximately 541,000 square feet in Baltimore, Maryland for $63.1 million. The sale is subject to the satisfaction of customary closing conditions and, although there can be no assurances that the sale will be consummated, we have no reason to believe that the closing will not occur as expected by February 2003. Boston Properties will host a conference call tomorrow, January 22, 2003 at 10:00 AM (Eastern Time), open to the general public, to discuss the results of this year's fourth quarter. The number to call for this interactive teleconference is (800) 374-1372. A replay of the conference call will be available through January 29, 2003 by dialing (800) 642-1687 and entering the passcode 7277400. Additionally, a copy of Boston Properties' fourth quarter 2002 "Supplemental Operating and Financial Data" is available on the Investor section of the Company's website at http://www.bostonproperties.com. These materials are also available by contacting Investor Relations at 617-236-3322 or by written request to: Investor Relations Boston Properties, Inc. 111 Huntington Avenue, Suite 300 Boston, MA 02199-7610 Boston Properties is a fully integrated, self-administered and self-managed real estate investment trust that develops, redevelops, acquires, manages, operates and owns a diverse portfolio of Class A office, industrial and hotel properties. The Company is one of the largest owners and developers of Class A office properties in the United States, concentrated in four core markets - Boston, Midtown Manhattan, Washington, DC and San Francisco. THIS PRESS RELEASE CONTAINS FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF THE FEDERAL SECURITIES LAWS. YOU SHOULD EXERCISE CAUTION IN INTERPRETING AND RELYING ON FORWARD-LOOKING STATEMENTS BECAUSE THEY INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS WHICH ARE, IN SOME CASES, BEYOND BOSTON PROPERTIES' CONTROL AND COULD MATERIALLY AFFECT ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS. THESE FACTORS INCLUDE, WITHOUT LIMITATION, THE ABILITY TO ENTER INTO NEW LEASES OR RENEW LEASES ON FAVORABLE TERMS, DEPENDENCE ON TENANTS' FINANCIAL CONDITION, THE UNCERTAINTIES OF REAL ESTATE DEVELOPMENT AND ACQUISITION ACTIVITY, THE ABILITY TO EFFECTIVELY INTEGRATE ACQUISITIONS, THE COSTS AND AVAILABILITY OF FINANCING, THE EFFECTS OF LOCAL ECONOMIC AND MARKET CONDITIONS, REGULATORY CHANGES AND OTHER RISKS AND UNCERTAINTIES DETAILED FROM TIME TO TIME IN THE COMPANY'S FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION. Financial tables follow. BOSTON PROPERTIES, INC. CONSOLIDATED STATEMENTS OF OPERATIONS
THREE MONTHS ENDED YEAR ENDED DECEMBER 31, DECEMBER 31, ------------------- ----------------------- 2002 2001 2002 2001 -------- -------- ---------- ---------- (UNAUDITED AND IN THOUSANDS, EXCEPT FOR PER SHARE AMOUNTS) Revenue Rental: Base rent............................................... $265,559 $220,534 $ 978,382 $ 843,147 Recoveries from tenants................................. 38,929 32,368 144,576 127,024 Parking and other....................................... 13,217 11,757 50,827 51,999 -------- -------- ---------- ---------- Total rental revenue.................................. 317,705 264,659 1,173,785 1,022,170 Hotel revenue............................................. 24,779 -- 44,786 -- Development and management services....................... 2,769 3,528 10,748 12,167 Interest and other........................................ 700 1,829 5,504 12,183 -------- -------- ---------- ---------- Total revenue......................................... 345,953 270,016 1,234,823 1,046,520 -------- -------- ---------- ---------- Expenses Operating Rental.................................................. 102,726 88,605 385,491 330,301 Hotel................................................... 17,562 -- 31,086 -- General and administrative................................ 12,703 8,663 47,292 38,312 Interest.................................................. 72,146 59,730 271,685 223,389 Depreciation and amortization............................. 53,957 39,993 186,177 149,181 Net derivative losses..................................... 1,461 2,080 11,874 26,488 Loss on investments in securities......................... -- -- 4,297 6,500 -------- -------- ---------- ---------- Total expenses........................................ 260,555 199,071 937,902 774,171 -------- -------- ---------- ---------- Income before minority interests, income from unconsolidated joint ventures, minority interest in Operating Partnership, gains on sales of real estate and land held for development, discontinued operations, extraordinary items, cumulative effect of a change in accounting principle and preferred dividend.......................... 85,398 70,945 296,921 272,349 Minority interests in property partnerships................. 162 456 2,065 1,085 Income from unconsolidated joint ventures................... 2,083 1,345 7,954 4,186 -------- -------- ---------- ---------- Income before minority interest in Operating Partnership, gains on sales of real estate and land held for development, discontinued operations, extraordinary items, cumulative effect of a change in accounting principle and preferred dividend........................................ 87,643 72,746 306,940 277,620 Minority interest in Operating Partnership.................. (20,867) (19,084) (77,524) (74,739) -------- -------- ---------- ---------- Income before gains on sales of real estate and land held for development, discontinued operations, extraordinary items, cumulative effect of a change in accounting principle and preferred dividend.......................... 66,776 53,662 229,416 202,881 Gains on sales of real estate, net of minority interest..... 187,562 -- 186,810 6,505 Gains on sales of land held for development, net of minority interest.................................................. -- 2,584 3,633 2,584 -------- -------- ---------- ---------- Income before discontinued operations, extraordinary items, cumulative effect of a change in accounting principle and preferred dividend........................................ 254,338 56,246 419,859 211,970 Discontinued Operations: Income from discontinued operations, net of minority interest................................................ 127 682 1,135 2,829 Gains on sales of real estate from discontinued operations, net of minority interest.................... 7,645 -- 25,345 -- -------- -------- ---------- ---------- Income before extraordinary items, cumulative effect of a change in accounting principle and preferred dividend..... 262,110 56,928 446,339 214,799 Extraordinary items, net of minority interest............... (1,964) -- (1,956) -- -------- -------- ---------- ---------- Income before cumulative effect of a change in accounting principle and preferred dividend.......................... 260,146 56,928 444,383 214,799 Cumulative effect of a change in accounting principle, net of minority interest...................................... -- -- -- (6,767) -------- -------- ---------- ---------- Net income before preferred dividend........................ 260,146 56,928 444,383 208,032 Preferred dividend.......................................... -- (1,648) (3,412) (6,592) -------- -------- ---------- ---------- Net income available to common shareholders................. $260,146 $ 55,280 $ 440,971 $ 201,440 ======== ======== ========== ========== Basic earnings per share: Income available to common shareholders before discontinued operations, extraordinary items and cumulative effect of a change in accounting principle... $ 2.67 $ 0.60 $ 4.47 $ 2.28 Discontinued operations................................... -- 0.01 0.01 0.03 Gains on sales from discontinued operations............... 0.08 -- 0.27 -- Extraordinary items....................................... (0.02) -- (0.02) -- Cumulative effect of a change in accounting principle..... -- -- -- (0.07) -------- -------- ---------- ---------- Net income available to common shareholders............... $ 2.73 $ 0.61 $ 4.73 $ 2.24 ======== ======== ========== ========== Weighted average number of common shares outstanding...... 95,313 90,737 93,145 90,002 ======== ======== ========== ========== Diluted earnings per share: Income available to common shareholders before discontinued operations, extraordinary items and cumulative effect of a change in accounting principle... $ 2.64 $ 0.59 $ 4.40 $ 2.23 Discontinued operations................................... -- 0.01 0.01 0.03 Gains on sale from discontinued operations................ 0.08 -- 0.27 -- Extraordinary items....................................... (0.02) -- (0.02) -- Cumulative effect of a change in accounting principle..... -- -- -- (0.07) -------- -------- ---------- ---------- Net income available to common shareholders............... $ 2.70 $ 0.60 $ 4.66 $ 2.19 ======== ======== ========== ========== Weighted average number of common and common equivalent shares outstanding...................................... 96,395 92,593 94,612 92,200 ======== ======== ========== ========== BOSTON PROPERTIES, INC. CONSOLIDATED BALANCE SHEETS
DECEMBER 31, DECEMBER 31, 2002 2001 ------------ ------------ (IN THOUSANDS, EXCEPT FOR SHARE AMOUNTS) (UNAUDITED) ASSETS Real estate................................................. $7,781,684 $6,167,399 Development in progress..................................... 448,576 1,107,835 Land held for future development............................ 215,866 182,672 Real estate held for sale, net.............................. 224,585 -- Less: accumulated depreciation............................ (822,933) (719,854) ---------- ---------- Total real estate....................................... 7,847,778 6,738,052 Cash and cash equivalents................................... 55,275 98,067 Escrows..................................................... 41,906 23,000 Investments in securities................................... -- 4,297 Tenant and other receivables, net........................... 20,458 43,546 Accrued rental income, net.................................. 165,321 119,494 Deferred charges, net....................................... 176,545 107,573 Prepaid expenses and other assets........................... 18,015 20,996 Investments in unconsolidated joint ventures................ 101,905 98,485 ---------- ---------- Total assets............................................ $8,427,203 $7,253,510 ========== ========== LIABILITIES AND STOCKHOLDERS' EQUITY Liabilities: Mortgage notes and bonds payable.......................... $4,267,119 $4,314,942 Unsecured senior notes.................................... 747,375 -- Unsecured bridge loan..................................... 105,683 -- Unsecured line of credit.................................. 27,043 -- Accounts payable and accrued expenses..................... 93,846 81,108 Dividends and distributions payable....................... 81,226 79,561 Interest rate contracts................................... 14,514 11,147 Accrued interest payable.................................. 25,141 9,080 Other liabilities......................................... 61,085 58,859 ---------- ---------- Total liabilities....................................... 5,423,032 4,554,697 ---------- ---------- Commitments and contingencies............................... -- -- ---------- ---------- Minority interests.......................................... 844,581 844,740 ---------- ---------- Series A Convertible Redeemable Preferred Stock, liquidation preference $50.00 per share, 0 and 2,000,000 shares issued and outstanding in 2002 and 2001, respectively............ -- 100,000 ---------- ---------- Stockholders' equity: Excess stock, $.01 par value, 150,000,000 shares authorized, none issued or outstanding.................. -- -- Common stock, $.01 par value, 250,000,000 shares authorized, 95,362,990 and 90,780,591 issued and outstanding in 2002 and 2001, respectively.............. 954 908 Additional paid-in capital................................ 1,981,833 1,789,521 Earnings in excess of dividends........................... 199,442 (17,669) Treasury common stock, at cost............................ (2,722) (2,722) Unearned compensation..................................... (2,899) (2,097) Accumulated other comprehensive loss...................... (17,018) (13,868) ---------- ---------- Total stockholders' equity.............................. 2,159,590 1,754,073 ---------- ---------- Total liabilities and stockholders' equity............ $8,427,203 $7,253,510 ========== ========== BOSTON PROPERTIES, INC. FUNDS FROM OPERATIONS (1) (1) Pursuant to the revised definition of Funds from Operations adopted by the Board of Governors of the National Association of Real Estate Investment Trusts ("NAREIT"), the Company calculates Funds From Operations, or "FFO," by adjusting net income (loss) (computed in accordance with accounting principles generally accepted in the United States of America ("GAAP"), including non-recurring items), for gains (or losses) from sales or properties (except gains and losses from sales of real estate), real estate related depreciation and amortization, and after adjustment for unconsolidated partnerships and joint ventures. In addition to FFO (as defined by NAREIT), the Company also discloses FFO after specific supplemental adjustments. Although the Company's FFO as adjusted clearly differs from NAREIT's definition of FFO as well as that of other real estate companies, the Company believes it provides a more meaningful presentation of the Company's operating performance. In addition, the Company believes that to further understand its performance, FFO and FFO as adjusted should be compared with its reported net income and cash flows in accordance with GAAP, as presented in the Company's consolidated financial statements. The Company's computation of FFO may not be comparable to FFO reported by other REIT's or real estate companies that do not define the term in accordance with the current NAREIT definition or that interpret the current NAREIT definition differently. In addition to presenting FFO in accordance with the NAREIT definition, the Company makes adjustments to FFO, as defined by NAREIT, including net derivative losses and early surrender lease adjustments. FFO does not represent cash generated from operating activities determined in accordance with GAAP, and should not be considered as an alternative to net income (determined in accordance with GAAP) as an indication of the Company's performance, as an alternative to net cash flows from operating activities (determined in accordance with GAAP) as a measure of our liquidity, or as an indication of the Company's ability to make cash distributions. (2) Represents cash received under contractual obligations.
THREE MONTHS ENDED YEAR ENDED DECEMBER 31, DECEMBER 31, ------------------- ------------------- 2002 2001 2002 2001 -------- -------- -------- -------- (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) (UNAUDITED) Income before minority interests, income from unconsolidated joint ventures, minority interest in Operating Partnership, gains on sales of real estate and land held for development, discontinued operations, extraordinary items, cumulative effect of a change in accounting principle and preferred dividend.......................... $ 85,398 $ 70,945 $296,921 $272,349 Add: Real estate depreciation and amortization................. 56,072 41,034 192,574 153,550 Income from discontinued operations....................... 154 835 1,384 2,989 Income from unconsolidated joint ventures................. 2,083 1,345 7,954 4,186 Less: Minority interests in property partnerships' share of funds from operations................................... (1,390) (776) (3,223) (2,322) Preferred dividends and distributions..................... (5,926) (8,448) (28,711) (33,312) -------- -------- -------- -------- Funds from operations....................................... 136,391 104,935 466,899 397,440 Add (subtract): Net derivative losses (SFAS No. 133)...................... 1,461 2,080 11,874 26,488 Early surrender lease adjustment (2)...................... -- 3,927 8,520 (8,518) -------- -------- -------- -------- Funds from operations before net derivative losses (SFAS No. 133) and after early surrender lease adjustment........... $137,852 $110,942 $487,293 $415,410 ======== ======== ======== ======== Funds from operations available to common shareholders before net derivative losses (SFAS No. 133) and after early surrender lease adjustment.......................... $113,464 $ 90,704 $399,489 $337,823 ======== ======== ======== ======== Weighted average shares outstanding -- basic................ 95,313 90,737 93,145 90,002 ======== ======== ======== ======== FFO per share basic before net derivative losses (SFAS No. 133) and after early surrender adjustment............... $ 1.19 $ 1.00 $ 4.29 $ 3.75 ======== ======== ======== ======== FFO per share basic after net derivative losses (SFAS No. 133) and before early surrender lease adjustment........ $ 1.18 $ 0.95 $ 4.11 $ 3.59 ======== ======== ======== ======== Weighted average shares outstanding -- diluted.............. 105,631 105,577 105,799 105,185 ======== ======== ======== ======== FFO per share diluted before net derivative losses (SFAS No. 133) and after early surrender lease adjustment..... $ 1.14 $ 0.95 $ 4.09 $ 3.57 ======== ======== ======== ======== FFO per share diluted after net derivative losses (SFAS No. 133) and before early surrender lease adjustment.... $ 1.13 $ 0.90 $ 3.92 $ 3.42 ======== ======== ======== ======== BOSTON PROPERTIES, INC. PORTFOLIO OCCUPANCY
OCCUPANCY BY LOCATION ------------------------------------- DECEMBER 31, 2002 DECEMBER 31, 2001 ----------------- ----------------- Greater Boston.............................................. 91.8% 92.3% Greater Washington, D.C..................................... 95.9% 97.8% Midtown Manhattan........................................... 98.4% 99.8% Baltimore, MD............................................... 97.6% 99.2% Richmond, VA................................................ 91.8% 98.4% Princeton/East Brunswick, NJ................................ 93.3% 88.6% Greater San Francisco....................................... 87.4% 93.5% Bucks County, PA............................................ 100.0% 100.0% ----- ----- Total Portfolio........................................... 93.9% 95.3% ===== =====
OCCUPANCY BY TYPE ------------------------------------- DECEMBER 31, 2002 DECEMBER 31, 2001 ----------------- ----------------- Class A Office Portfolio.................................... 94.1% 95.4% Office/Technical Portfolio.................................. 89.7% 97.9% Industrial Portfolio........................................ 100.0% 87.3% ----- ---- Total Portfolio........................................... 93.9% 95.3% ===== ====