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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

FOR ANNUAL AND TRANSITION REPORTS
PURSUANT TO SECTIONS 13 OR 15(d) OF THE
SECURITIES ACT OF 1934

ý	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2002
OR
o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition period from to

Commission file number 1-13087

BOSTON PROPERTIES, INC.
(Exact name of Registrant as Specified in its Charter)

Delaware (State or Other Jurisdiction of Incorporation or Organization)		04-2473675 (IRS Employer Id. Number)
111 Huntington Avenue Boston, Massachusetts (Address of Principal Executive Offices)		02199 (Zip Code)
Registrant's telephone number, including area code: (617) 236-3300

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class		Name of Exchange on Which Registered
Common Stock, Par Value $.01 Preferred Stock Purchase Rights		New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark whether the Registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ý

Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2. Yes ý No o

As of June 28, 2002, the aggregate market value of the 87,240,183 shares of common stock held by non-affiliates of the Registrant was $3,485,245,311 based upon the closing price of $39.95 on the New York Stock Exchange composite tape on such date. (For this computation, the Registrant has excluded the market value of all shares of Common Stock reported as beneficially owned by executive officers and directors of the Registrant; such exclusion shall not be deemed to constitute an admission that any such person is an affiliate of the Registrant.) As of February 19, 2003, there were 95,913,698 shares of Common Stock outstanding.

Certain information contained in the Registrant's Proxy Statement relating to its Annual Meeting of Stockholders to be held May 7, 2003 are incorporated by reference in Part III, Items 10, 11, 12 and 13.

TABLE OF CONTENTS

ITEM NO.	DESCRIPTION	PAGE NO.
PART I
1.	BUSINESS	1
2.	PROPERTIES	23
3.	LEGAL PROCEEDINGS	28
4.	SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS	28
PART II
5.	MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS	29
6.	SELECTED FINANCIAL DATA	29
7.	MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	31
7A.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	59
8.	FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA	59
9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE	59
PART III
10.	DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT	60
11.	EXECUTIVE COMPENSATION	60
12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT	60
13.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS	61
14.	CONTROLS AND PROCEDURES	61
PART IV
15.	EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K	61
	SIGNATURES	68

PART I

Item 1. Business

General

As used herein, the terms "we," "us," "our" or the "Company" refer to Boston Properties, Inc., a Delaware corporation organized in 1997, individually or together with its subsidiaries, including Boston Properties Limited Partnership, a Delaware limited partnership, and our predecessors. We are a fully integrated self-administered and self-managed real estate investment trust or "REIT" and one of the largest owners and developers of office properties in the United States. Our properties are concentrated in four core markets—Boston, Washington, D.C., midtown Manhattan and San Francisco. We conduct substantially all of our business through our subsidiary Boston Properties Limited Partnership. At December 31, 2002, we owned or had interests in 142 properties, totaling 42.4 million net rentable square feet. Our properties consisted of 133 office properties, comprised of 105 Class A office buildings and 28 properties that support both office and technical uses, including five properties under construction, four industrial properties, two retail properties, including one retail property under construction, and three hotels. Subsequent to December 31, 2002, we sold two Class A office properties. We consider Class A office buildings to be centrally located buildings that are professionally managed and maintained, attract high-quality tenants and command upper-tier rental rates, and that are modern structures or have been modernized to compete with newer buildings. Our definition of Class A office buildings may be different than that of other companies.

We are a full service real estate company, with substantial in-house expertise and resources in acquisitions, development, financing, capital markets, construction management, property management, marketing, leasing, accounting, tax and legal services. As of December 31, 2002, we had approximately 675 employees. Our 31 senior officers have an average of 24 years experience in the real estate industry and an average of 15 years tenure with us. Our principal executive office is located at 111 Huntington Avenue, Boston, Massachusetts 02199 and its telephone number is (617) 236-3300. In addition, we have regional offices at 401 9^th Street, NW, Washington, D.C. 20004; 599 Lexington Avenue, New York, New York 10022; Four Embarcadero Center, San Francisco, California 94111; and 302 Carnegie Center, Princeton, New Jersey 08540.

Our Web site is located at http://www.bostonproperties.com. On our Web site, you can obtain a copy of our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act of 1934, as amended, as soon as reasonably practicable after we file such material electronically with, or furnish it to, the Securities and Exchange Commission (the "SEC"). The name "Boston Properties" and our logo (consisting of a stylized "b") are registered trademarks of the Company.

Boston Properties Limited Partnership

Boston Properties Limited Partnership, a Delaware limited partnership, is the entity through which we conduct substantially all of our business and own, either directly or through subsidiaries, substantially all of our assets. We are the sole general partner and, as of February 19, 2003, the owner of approximately 76.37% of the economic interests in Boston Properties Limited Partnership. Economic interest was calculated as the number of common partnership units of Boston Properties Limited Partnership owned by the Company as a percentage of the sum of (i) the actual aggregate number of outstanding common partnership units of Boston Properties Limited Partnership and (ii) the number of common partnership units issuable upon conversion of outstanding preferred partnership units of Boston Properties Limited Partnership. This structure is commonly referred to as an umbrella partnership REIT or "UPREIT." Our general and limited partnership interests in Boston Properties Limited Partnership entitle us to share in cash distributions from, and in the profits and losses of, Boston Properties Limited Partnership in proportion to our percentage interest therein and entitle us to

vote on all matters requiring a vote of the limited partners. The other partners of Boston Properties Limited Partnership are persons who contributed their direct or indirect interests in certain properties to Boston Properties Limited Partnership in exchange for common units of limited partnership interest in Boston Properties Limited Partnership or preferred units of limited partnership interest in Boston Properties Limited Partnership. Pursuant to the limited partnership agreement of Boston Properties Limited Partnership, unitholders may tender their common units of Boston Properties Limited Partnership for cash equal to the value of an equivalent number of shares of our common stock. In lieu of delivering cash, however, we may, at our option, choose to acquire any common units so tendered by issuing common stock in exchange for the common units. If we so choose, our common stock will be exchanged for common units on a one-for-one basis. This one-for-one exchange ratio is subject to specified adjustments to prevent dilution. We currently anticipate that we will elect to issue our common stock in connection with each such presentation for redemption rather than having Boston Properties Limited Partnership pay cash. With each such exchange or redemption, our percentage ownership in Boston Properties Limited Partnership will increase. In addition, whenever we issue shares of our common stock other than to acquire common units of Boston Properties Limited Partnership, we must contribute any net proceeds we receive to Boston Properties Limited Partnership and Boston Properties Limited Partnership must issue to us an equivalent number of common units of Boston Properties Limited Partnership.

Preferred units of Boston Properties Limited Partnership have the rights, preferences and other privileges, including the right to convert into common units of Boston Properties Limited Partnership, as are set forth in amendments to the limited partnership agreement of Boston Properties Limited Partnership. As of December 31, 2002 and February 19, 2003, Boston Properties Limited Partnership had two series of its preferred units outstanding. The Series One preferred units have an aggregate liquidation preference of approximately $80.9 million and are entitled to a preferred distribution at a rate of 7.25% per annum, payable quarterly. Series One units are convertible into common units at the rate of $38.25 per common unit at the holder's election at any time. We also have the right to convert into common units of Boston Properties Limited Partnership all or part of the Series One units on or after June 30, 2003, if our common stock at the time of our election is trading at a price of at least $42.08 per share.

The Series Two preferred units have an aggregate liquidation preference of approximately $270.0 million. The Series Two units are convertible, at the holder's election, into common units at a conversion price of $38.10 per common unit. Distributions on the Series Two units are payable quarterly and generally accrue at rates of 6.5% through December 31, 2002; 7.0% until May 12, 2009; and 6.0% thereafter. If distributions on the number of common units into which the Series Two units are convertible are greater than distributions calculated using the rates described in the preceding sentence for the applicable quarterly period, then the greater distributions are payable instead. The terms of the Series Two units provide that they may be redeemed for cash in six annual tranches, beginning on May 12, 2009, at our election or at the election of the holders. We also have the right to convert into common units of Boston Properties Limited Partnership any Series Two units that are not redeemed when they are eligible for redemption.

Significant Transactions During 2002

Real Estate Acquisitions/Dispositions

On September 25, 2002, we acquired 399 Park Avenue, an approximately 1.7 million square foot office tower in midtown Manhattan. The total acquisition cost of approximately $1.06 billion (including closing costs) was financed with an unsecured bridge loan totaling $1.0 billion and cash. The acquisition of 399 Park Avenue was structured so as to permit us to engage in like-kind exchanges in reliance on Section 1031 of the Internal Revenue Code, which structure allows us to dispose of properties with an aggregate value of up to $1.06 billion within a six-month period following the acquisition of 399 Park Avenue without recognizing gain for federal income tax purposes.

During the year ended December 31, 2002, we sold land parcels in Herndon, Virginia and South San Francisco, California, and certain garage parking spaces at the Prudential Center in Boston, Massachusetts, for gross proceeds of approximately $15.5 million, resulting in a gain on sale of approximately $4.6 million. In addition, on August 16, 2002, we acquired 20F Street, a ¹/2 acre parcel of land in Washington, D.C., for approximately $2.4 million.

On December 2, 2002, we sold 2391 West Winton Avenue in Hayward, California, an industrial property totaling approximately 220,000 net rentable square feet, for gross proceeds of approximately $10.8 million, resulting in a gain on sale of approximately $9.3 million.

On November 22, 2002, we sold One and Two Independence Square in Washington, D.C., consisting of two Class A office properties totaling approximately 900,000 net rentable square feet, for gross proceeds of approximately $345.0 million which was used to repay secured and unsecured debt. We recognized a gain of approximately $227.8 million on the sale of One and Two Independence Square. As we continue to manage the property following the sale, the transaction has not been reflected as "discontinued operations" in our consolidated statements of operations.

On November 25, 2002, we entered into a binding contract for the sale of 875 Third Avenue in midtown Manhattan, a Class A office building totaling approximately 719,000 net rentable square feet and subsequently closed the transaction on February 4, 2003, for approximately $361.3 million (excluding $8.8 million in future obligations assumed by the buyer relating to unpaid brokerage commissions and tenant improvement allowances). Proceeds of the sale were used to repay secured and unsecured debt. As we continued to manage the property following the sale, the transaction has not been reflected as "discontinued operations" in our consolidated statements of operations.

On March 4, 2002, we sold Fullerton Square, consisting of two office/technical properties totaling 179,000 net rentable square feet in Springfield, Virginia, for gross proceeds of approximately $22.5 million, resulting in a gain on sale of approximately $7.1 million.

On March 4, 2002, we sold 7600, 7700 and 7702 Boston Boulevard, consisting of three office/technical properties totaling approximately 195,000 net rentable square feet in Springfield, Virginia, for gross proceeds of approximately $34.1 million. Due to our obligation to provide development services related to the Boston Boulevard properties, that transaction did not qualify as a sale for financial reporting purposes in the first quarter of 2002 and had been accounted for as a financing transaction. During the third quarter of 2002, we completed our continuing involvement with the Boston Boulevard properties and recognized a gain on the sale of approximately $14.4 million.

The sales mentioned above of One and Two Independence Square, 875 Third Avenue, 2391 West Winton and 7600, 7700 and 7702 Boston Boulevard were structured as like-kind exchanges. Accordingly, taxable gain for federal income tax purposes was recognized and the tax attributes (including depreciated tax basis and any tax protection covenants for the benefit of former owners) of these disposed properties have been transferred to 399 Park Avenue as the property for which they were exchanged.

Developments

We placed five Class A office buildings and two office/technical properties in-service during 2002, which required a total investment during 2002 of approximately $148.9 million, of which $117.8 was funded through existing construction loans. Our total investment, including equity and debt, through December 31, 2002 on these properties was $924.0 million, including $806.6 million relating to 111 Huntington Avenue and 5 Times Square. We began or continued construction on an additional six office buildings, including two buildings in which we have a joint venture interest, and incurred approximately $172.4 million of construction costs during 2002, of which $111.0 million was funded through existing construction loans.

Unsecured Debt

On December 13, 2002, Boston Properties Limited Partnership closed an unregistered offering of $750.0 million in aggregate principal amount of its 6.25% senior unsecured notes due 2013. The notes were offered only to qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"), and to certain investors outside of the United States in reliance on Regulation S under the Securities Act. The notes were priced at 99.65% of their face amount to yield 6.296%. We used the net proceeds to pay down our unsecured bridge loan which we incurred in connection with the acquisition of 399 Park Avenue in September 2002.

On January 17, 2003, Boston Properties Limited Partnership closed an unregistered offering of an additional $175 million in aggregate principal amount of its 6.25% senior unsecured notes due 2013. The notes are fungible, and form a single series, with the notes sold in December 2002. The notes were offered only to qualified institutional buyers in reliance on Rule 144A under the Securities Act. The notes were priced at 99.763% of their face amount to yield 6.28%. We used the net proceeds to pay down our unsecured bridge loan, a portion of our unsecured line of credit as well as certain construction loans.

In connection with the December 2002 and January 2003 offerings of its unsecured senior notes, Boston Properties Limited Partnership agreed to register an exchange offer in which the outstanding unregistered notes will be exchanged for registered notes of identical principal amount and with substantially identical terms.

Boston Properties Limited Partnership received investment grade ratings on its inaugural offering of senior unsecured notes of:

Rating Organization	Rating
Moody's	Baa2 (stable	)
Standard & Poor's	BBB (stable	)
FitchRatings	BBB (stable	)

The security rating is not a recommendation to buy, sell or hold securities, as it may be subject to revision or withdrawal at any time by the rating organization. Ratings assigned by each rating organization have their own meaning within the organization's overall classification system. Each rating should be evaluated independently of any other rating.

In addition, on September 25, 2002, we obtained unsecured bridge financing totaling $1.0 billion in connection with the acquisition of 399 Park Avenue. During 2002, we repaid approximately $894.3 million with proceeds from the offering of unsecured senior notes and proceeds from the sales of certain real estate properties. During January 2003, we repaid all remaining amounts outstanding under our unsecured bridge loan from the proceeds of the January 17, 2003 additional offering of unsecured senior notes mentioned above.

Equity Transactions

On July 9, 2002, we issued 1,066,232 shares of our common stock with a fair value of approximately $41.2 million on the date of issuance, as a result of the conversion of an aggregate of 812,469 Series Two and Series Three preferred units of Boston Properties Limited Partnership into 1,066,232 common units of Boston Properties Limited Partnership, which common units we immediately acquired in exchange for an equal number of shares of our common stock. In addition, we issued 2,624,671 shares of our common stock as a result of the conversion of all of our 2,000,000 shares of preferred stock outstanding and we issued 1,566,679 shares of our common stock as a result of our election, as general partner of Boston Properties Limited Partnership, to acquire the common units upon redemption in exchange for an equal number of shares of our common stock.

Business and Growth Strategies

Business Strategy

Our primary business objective is to maximize return on investment so as to provide our stockholders with the greatest possible total return. Our strategy to achieve this objective is:

•: to concentrate on a few carefully selected markets and to be one of the leading, if not the leading, owners and developers in each of those markets. We select markets and submarkets where tenants have demonstrated a preference for high quality office buildings and other facilities;
•: to emphasize markets and submarkets within those markets where there are barriers to the creation of new supply and where skill, financial strength and diligence are required to successfully develop and manage high quality office, research and development and/or industrial space and selected retail space;
•: to take on complex, technically challenging projects, leveraging the skills of our management team to successfully develop, acquire or reposition properties which other organizations may not have the capacity or resources to pursue;
•: to concentrate on high quality, state-of-the-art real estate designed to meet the demands of today's knowledge-based tenants and to manage those facilities so as to become the landlord of choice for both existing and prospective clients;
•: to opportunistically acquire assets which increase our penetration in the markets in which we have chosen to concentrate and which exhibit an opportunity to improve or preserve returns through repositioning, changes in management focus and re-leasing as existing leases terminate;
•: to explore joint venture opportunities with existing owners of irreplaceable real estate locations and/or with strategic institutional partners, leveraging our skills as owners, operators and developers of Class A office space;
•: to explore the sale of properties to take advantage of our value creation and the demand for our premier properties as reflected in the high sales prices obtained from recent sales of our properties;
•: to seek third party development contracts to provide us with additional fee income and to enable us to retain and utilize our existing development and construction management staff; and
•: to enhance our balanced capital structure through our access to a variety of sources of capital.

Growth Strategies

External Growth

We believe that we are well positioned to realize significant growth through external asset development and acquisition. We believe that our development experience and our organizational depth position us to continue to develop a range of property types, from single-story suburban office properties to high-rise urban developments, within budget and on schedule. Other factors that contribute to our competitive position include:

•: our control of sites (including sites under contract or option to acquire) in our markets that will support approximately 8.8 million square feet of new office, hotel and residential development;
•: our reputation gained through the stability and strength of our existing portfolio of properties;
•: our relationships with leading national corporations and public institutions seeking new facilities and development services;

•: our relationships with nationally recognized financial institutions that provide capital to the real estate industry;
•: the substantial amount of commercial real estate owned by domestic and foreign institutions, private investors, and corporations who are seeking to sell these assets in our market areas;
•: our ability to act quickly on due diligence and financing; and
•: our relationships with institutional buyers and sellers of high quality real estate assets.

We have targeted three areas of development and acquisition as significant opportunities to execute our external growth strategy:

•: Pursue development in selected submarkets. We believe that development of well-positioned office buildings will continue to be justified in many of our submarkets. We believe in acquiring land after taking into consideration timing factors relating to economic cycles, and in response to market conditions that allow for its development at the appropriate time. While we purposely concentrate in markets with high barriers to entry, we have demonstrated throughout our 30 year history, an ability to make carefully timed land acquisitions in submarkets where we can become one of the market leaders in establishing rent and other business terms. We believe that there are opportunities in our existing and other markets for a well-capitalized developer to acquire land with development potential at key locations.

In the past, we have been particularly successful at acquiring sites or options to purchase sites that need governmental approvals. Because of our development expertise, knowledge of the governmental approval process and reputation for quality development with local government regulatory bodies, we generally have been able to secure the permits necessary to allow development, and to profit from the resulting increase in land value. We seek out complex projects where we can add value through the efforts of our experienced and skilled management team leading to significantly enhanced returns on investment.

Our strong regional relationships and recognized development expertise have enabled us to capitalize on unique built-to-suit opportunities. We intend to seek out and expect to continue to be presented with such opportunities in the future allowing us to earn relatively attractive returns on these development opportunities through multiple business cycles.

•: Acquire assets and portfolios of assets from institutions or individuals. We believe that due to our size, management strength and reputation, we are in an advantageous position to acquire portfolios of assets or individual properties from institutions or individuals. We may acquire properties for cash, but we are also particularly well positioned to appeal to sellers wishing to convert on a tax-deferred basis their ownership of property to the ownership of equity in a diversified real estate operating company that offers liquidity through access to the public equity markets. In addition, we may pursue mergers with and acquisitions of compatible real estate firms. Our ability to offer common units and preferred units in Boston Properties Limited Partnership to sellers who would otherwise recognize a gain upon a sale of assets for cash or our common stock may facilitate this type of transaction on a tax-efficient basis.
•: Acquire existing underperforming assets and portfolios of assets. We continue to actively pursue opportunities to acquire existing buildings that, while currently generating income, are either underperforming the market due to poor management or are currently leased at below market rents with anticipated roll-over of space. These opportunities may include the acquisition of entire portfolios of properties. We believe that because of our in-depth market knowledge and development experience in each of our markets, our national reputation with brokers, financial institutions and others involved in the real estate market and our access to competitively-priced capital, we are well-positioned to identify and acquire existing, underperforming properties for competitive prices and to add significant additional value to such properties through our effective marketing strategies and responsive property management program.

Internal Growth

We believe that significant opportunities will exist in the long term to increase cash flow from our existing properties because they are of high quality and in desirable locations. In addition, our properties are in markets where, in general, the creation of new supply is limited by the lack of available sites, the difficulty of receiving the necessary approvals for development on vacant land and obtaining financing. Our strategy for maximizing the benefits from these opportunities is two-fold: (1) to provide high quality property management services using our own employees in order to encourage tenants to renew, expand and relocate in our properties, and (2) to achieve speed and transaction cost efficiency in replacing departing tenants through the use of in-house services for marketing, lease negotiation, and construction of tenant improvements. In addition, we believe that once normal market conditions return, our hotel properties will add to our internal growth because of their desirable locations in the downtown Boston and East Cambridge submarkets. We expect to continue our internal growth as a result of our ability to:

•: Cultivate existing submarkets and long-term relationships with credit tenants. In choosing locations for our properties, we have paid particular attention to transportation and commuting patterns, physical environment, adjacency to established business centers, proximity to sources of business growth and other local factors.

We had an industry-leading average lease term of 7.2 years at December 31, 2002 and continue to cultivate long-term leasing relationships with a diverse base of high quality, financially stable tenants. Based on leases in place at December 31, 2002, leases with respect to 4.4% of our Class A office buildings will expire in calendar year 2003.

•: Directly manage properties to maximize the potential for tenant retention. We provide property management services ourselves, rather than contracting for this service, to maintain awareness of and responsiveness to tenant needs. We and our properties also benefit from cost efficiencies produced by an experienced work force attentive to preventive maintenance and energy management and from our continuing programs to assure that our property management personnel at all levels remain aware of their important role in tenant relations.
•: Replace tenants quickly at best available market terms and lowest possible transaction costs. We believe that we have a competitive advantage in attracting new tenants and achieving rental rates at the higher end of our markets as a result of our well located, well designed and well maintained properties, our reputation for high quality building services and responsiveness to tenants, and our ability to offer expansion and relocation alternatives within our submarkets.
•: Extend terms of existing leases to existing tenants prior to expiration. We have also successfully structured early tenant renewals which have reduced the cost associated with lease downtime while securing the tenancy of our highest quality credit-worthy tenants on a long term basis and enhancing relationships which may lead to future tenant expansion.

Competition

We compete in the leasing of office and industrial space with a considerable number of other real estate companies, some of which may have greater marketing and financial resources. In addition, our hotel properties compete for guests with other hotels, some of which may have greater marketing and financial resources than are available to us and Marriott® International, Inc.

The Hotel Properties

Effective July 1, 2002, we restructured the leases with respect to ownership of our three hotel properties by forming a taxable REIT subsidiary ("TRS"). The TRS, a wholly-owned subsidiary of Boston Properties Limited Partnership, is the lessee pursuant to new leases for each of the hotel properties. As lessor, Boston Properties Limited Partnership is entitled to a percentage of gross receipts from the hotel properties. Marriott® International, Inc. will continue to manage the hotel properties under the Marriott® name and under terms of the existing management agreements. The restructuring of the hotel leases allows all the economic benefits of ownership to flow to the Company.

Seasonality

Our hotel properties traditionally have experienced significant seasonality in their operating income, with weighted average net operating income (defined as revenues less operating expenses) by quarter over the year ended December 31, 2002 as follows:

First Quarter		Second Quarter		Third Quarter		Fourth Quarter
13%		27%		28%		32%

RISK FACTORS

Set forth below are the risks that we believe are material to our stockholders. We refer to the shares of our common stock and preferred stock and the units of limited partnership interest in Boston Properties Limited Partnership together as our "securities," and the investors who own shares and/or units as our "securityholders." This section contains some forward-looking statements. You should refer to the explanation of the qualifications and limitations on forward-looking statements beginning on page 30.

Our performance and value are subject to risks associated with our real estate assets and with the real estate industry.

Our economic performance and the value of our real estate assets, and consequently the value of our securities, are subject to the risk that if our office, industrial, and hotel properties do not generate revenues sufficient to meet our operating expenses, including debt service and capital expenditures, our cash flow and ability to pay distributions to our securityholders will be adversely affected. The following factors, among others, may adversely affect the income generated by our office, industrial and hotel properties:

•: downturns in the national, regional and local economic climate;
•: competition from other office, hotel and other commercial buildings;
•: local real estate market conditions, such as oversupply or reduction in demand for office, hotel or other commercial space;
•: changes in interest rates and availability of financing;
•: vacancies, changes in market rental rates and the need to periodically repair, renovate and relet space;
•: increased operating costs, including insurance expenses, utilities, real estate taxes, and heightened security costs;
•: civil disturbances, earthquakes and other natural disasters, or terrorist acts or acts of war which may result in uninsured or underinsured losses;
•: significant expenditures associated with each investment, such as debt service payments, real estate taxes, insurance and maintenance costs which are generally not reduced when circumstances cause a reduction in revenues from a property; and
•: ability to collect rents from tenants.

We are dependent upon the economic climates of our four core markets—Boston, Washington, D.C., midtown Manhattan and San Francisco.

A majority of our revenues are derived from properties located in our four core markets: Boston, Washington, D.C., midtown Manhattan and San Francisco. As a result of the current slowdown in economic activity, there has been an increase in vacancy rates for office properties in these markets. A continued downturn in the economies of these markets, or the impact that the downturn in the overall national economy may have upon these economies, could result in further reduced demand for office space. Because our portfolio consists primarily of office buildings (as compared to a more diversified real estate portfolio), a decrease in demand for office space in turn could adversely affect our results from operations. Additionally, there are submarkets within our core markets that are dependent upon a limited number of industries. A significant downturn in one or more of these industries could also adversely affect our results of operations.

Our investment in property development may be more costly than anticipated.

We have a significant development pipeline and intend to continue to develop and substantially renovate office, industrial and hotel properties. Our current and future development and construction activities may be exposed to the following risks:

•: we may be unable to proceed with the development of properties because we cannot obtain financing on favorable terms;
•: we may incur construction costs for a development project which exceed our original estimates due to increases in interest rates and increased materials, labor or other costs, which could make completion of the project less profitable because we may not be able to increase rents to compensate for the increase in construction costs;
•: we may be unable to obtain, or face delays in obtaining, required zoning, land-use, building, occupancy, and other governmental permits and authorizations, which could result in increased costs and could require us to abandon our activities entirely with respect to a project;
•: we may abandon development opportunities after we begin to explore them and as a result we may fail to recover expenses already incurred;
•: we may expend funds on and devote management's time to projects which we do not complete;
•: we may be unable to complete construction and/or leasing of a property on schedule, resulting in increased debt service and fixed expenses and construction or renovation costs;
•: we may lease developed properties at below projected rental rates; and
•: occupancy rates and rents at newly completed properties may fluctuate depending on a number of factors, including market and economic conditions, and may result in our investment not being profitable.

Our use of joint ventures may limit our flexibility with jointly owned investments.

In appropriate circumstances, we intend to develop and acquire properties in joint ventures with other persons or entities when circumstances warrant the use of these structures. We could become engaged in a dispute with any of our joint venturers which might affect our ability to operate a property. In addition, our joint venture partners may have different objectives than we do regarding the appropriate timing and pricing of any sale or refinancing of properties. Finally, in many instances, our joint venture partners have competing interests in our markets that could create conflict of interest issues.

In 2000, we entered into a joint venture with the New York State Common Retirement Fund which has agreed to contribute up to $270 million to acquire and develop properties with us. During the three-year investment period for this joint venture, which ends on May 12, 2003, the New York State Common Retirement Fund has the right to participate in all of our acquisition opportunities that meet agreed criteria and any development projects that we choose to pursue with an institutional partner. Its participation may limit our flexibility in acquiring properties or pursuing development projects.

We face risks associated with property acquisitions.

Since our initial public offering, we have made acquisitions of large properties and portfolios of properties. We intend to continue to acquire properties and portfolios of properties, including large

portfolios that could increase our size and result in alterations to our capital structure. Our acquisition activities and their success are subject to the following risks:

•: we may be unable to acquire a desired property because of competition from other well capitalized real estate investors, including both publicly traded real estate investment trusts and institutional investment funds;
•: even if we enter into an acquisition agreement for a property, it is usually subject to customary conditions to closing, including completion of due diligence investigations to our satisfaction, which may not be satisfied;
•: even if we are able to acquire a desired property, competition from other real estate investors may significantly increase the purchase price;
•: we may be unable to finance acquisitions on favorable terms;
•: acquired properties may fail to perform as expected;
•: the actual costs of repositioning or redeveloping acquired properties may be higher than our estimates;
•: acquired properties may be located in new markets where we may face risks associated with a lack of market knowledge or understanding of the local economy, lack of business relationships in the area and unfamiliarity with local governmental and permitting procedures; and
•: we may be unable to quickly and efficiently integrate new acquisitions, particularly acquisitions of portfolios of properties, into our existing operations, and as a result our results of operations and financial condition could be adversely affected.

We have acquired in the past and in the future may acquire properties or portfolios of properties through tax deferred contribution transactions in exchange for partnership interests in Boston Properties Limited Partnership. This acquisition structure has the effect, among others, of reducing the amount of tax depreciation we can deduct over the tax life of the acquired properties, and typically requires that we agree to protect the contributors' ability to defer recognition of taxable gain through restrictions on our ability to dispose of the acquired properties and/or the allocation of partnership debt to the contributors to maintain their tax basis.

We may acquire properties subject to liabilities and without any recourse, or with only limited recourse, with respect to unknown liabilities. As a result, if a liability were asserted against us based upon ownership of those properties, we might have to pay substantial sums to settle it, which could adversely affect our cash flow. Unknown liabilities with respect to properties acquired might include:

•: liabilities for clean-up of undisclosed environmental contamination;
•: claims by tenants, vendors or other persons against the former owners of the properties;
•: liabilities incurred in the ordinary course of business; and
•: claims for indemnification by general partners, directors, officers and others indemnified by the former owners of the properties.

We face potential difficulties or delays renewing leases or re-leasing space.

We derive most of our income from rent received from our tenants. If a tenant experiences a downturn in its business or other types of financial distress, it may be unable to make timely rental payments. Also, when our tenants decide not to renew their leases or terminate early, we may not be able to re-lease the space. Even if tenants decide to renew, the terms of renewals or new leases, including the cost of required renovations or concessions to tenants, may be less favorable than current lease terms. As a result, our cash flow could decrease and our ability to make distributions to our securityholders could be adversely affected.

We face potential adverse effects from major tenants' bankruptcies or insolvencies.

The bankruptcy or insolvency of a major tenant may adversely affect the income produced by our properties. Our tenants could file for bankruptcy protection or become insolvent in the future. We cannot evict a tenant solely because of its bankruptcy. On the other hand, a bankrupt tenant may reject and terminate its lease with us. In such case, our claim against the bankrupt tenant for unpaid and future rent would be subject to a statutory cap that might be substantially less than the remaining rent actually owed under the lease, and, even so, our claim for unpaid rent would likely not be paid in full. This shortfall could adversely affect our cash flow and results of operations.

We may have difficulty selling our properties which may limit our flexibility.

Large and high quality office, industrial and hotel properties like the ones that we own could be difficult to sell. This may limit our ability to change our portfolio promptly in response to changes in economic or other conditions. In addition, federal tax laws limit our ability to sell properties that we have owned for fewer than four years and this may affect our ability to sell properties without adversely affecting returns to our securityholders. These restrictions reduce our ability to respond to changes in the performance of our investments and could adversely affect our financial condition and results of operations.

Our ability to dispose of some of our properties is constrained by their tax attributes. Properties which we developed and have owned for a significant period of time or which we acquired through tax deferred contribution transactions in exchange for partnership interests in Boston Properties Limited Partnership often have a low tax basis. If we dispose of these properties outright in taxable transactions, we may be required to distribute a significant amount of the taxable gain to our security holders under the requirements of the Internal Revenue Code for REIT's like the Company, which in turn would impact our cash flow. In some cases, we are restricted from disposing of properties contributed in exchange for our partnership interests under tax protection agreements with contributors. To dispose of low basis or tax-protected properties efficiently we often use like-kind exchanges, which qualify for non-recognition of taxable gain, but can be difficult to consummate and result in the property for which the disposed assets are exchanged inheriting their low basis and other tax attributes (including tax protection covenants).

Our properties face significant competition.

We face significant competition from developers, owners and operators of office, industrial and other commercial real estate, including sublease space available from our tenants. Substantially all of our properties face competition from similar properties in the same market. Such competition may affect our ability to attract and retain tenants and may reduce the rents we are able to charge. These competing properties may have vacancy rates higher than our properties, which may result in their owners being willing to make space available at lower prices than the space in our properties.

Because we own three hotel properties, we face the risks associated with the hospitality industry.

We own three hotel properties which we lease to our taxable REIT subsidiary, or TRS. Boston Properties Limited Partnership, as lessor, is entitled to a percentage of the gross receipts of our hotel properties and Marriott International, Inc. manages our hotel properties under the Marriott® name pursuant to a management contract with the TRS as lessee. While the TRS structure allows the economic benefits of ownership to flow to us, the TRS is subject to tax on its income from the operations of the hotels at the federal and state level. In addition changes in applicable tax laws may require us to modify the structure for owning our hotel properties, and such changes may adversely affect the cash flows from our hotels.

Because the lease payments we receive under the hotel leases are based on a participation in the gross receipts of the hotels, if the hotels do not generate sufficient receipts, our cash flow would be decreased, which could reduce the amount of cash available for distribution to our securityholders. The following factors, among others, are common to the hotel industry, and may reduce the receipts generated by our hotel properties:

•: our hotel properties compete for guests with other hotels, a number of which have greater marketing and financial resources than our hotel-operating business partners;
•: if there is an increase in operating costs resulting from inflation and other factors, our hotel-operating business partners may not be able to offset such increase by increasing room rates;
•: our hotel properties are subject to the fluctuating and seasonal demands of business travelers and tourism; and
•: our hotel properties are subject to general and local economic and social conditions that may affect demand for travel in general, including war and terrorism.

In addition, because all three of our hotel properties are located within a two-mile radius in downtown Boston and Cambridge, they are all subject to the Boston market's fluctuations in demand, increases in operating costs and increased competition from additions in supply.

Compliance or failure to comply with the Americans with Disabilities Act and other similar laws could result in substantial costs.

The Americans with Disabilities Act generally requires that public buildings, including office buildings and hotels, be made accessible to disabled persons. Noncompliance could result in the imposition of fines by the federal government or the award of damages to private litigants. If, pursuant to the Americans with Disabilities Act, we are required to make substantial alterations and capital expenditures in one or more of our properties, including the removal of access barriers, it could adversely affect our financial condition and results of operations, as well as the amount of cash available for distribution to our securityholders.

We may also incur significant costs complying with other regulations. Our properties are subject to various federal, state and local regulatory requirements, such as state and local fire and life safety requirements. If we fail to comply with these requirements, we could incur fines or private damage awards. We believe that our properties are currently in material compliance with all of these regulatory requirements. However, we do not know whether existing requirements will change or whether compliance with future requirements will require significant unanticipated expenditures that will affect our cash flow and results of operations.

Some potential losses are not covered by insurance.

We carry insurance coverage on our properties of types and in amounts that we believe are in line with coverage customarily obtained by owners of similar properties. We believe all of our properties are adequately insured. The property insurance that we maintain for our properties has historically been on an "all risk" basis, which until 2002 included losses caused by acts of terrorism. Following the terrorist activity of September 11, 2001 and the resulting uncertainty in the insurance market, insurance companies generally excluded insurance against acts of terrorism from their "all risk" policies. As a result, our "all risk" insurance coverage currently contains specific exclusions for losses attributable to acts of terrorism. In light of this development, in 2002 we purchased stand-alone terrorism insurance on a portfolio-wide basis with annual aggregate limits that we consider commercially reasonable, considering the availability and cost of such coverage. The federal Terrorism Risk Insurance Act, enacted in November 2002, requires regulated insurers to make available coverage for certified acts of terrorism (as defined by the statute) under property insurance policies, but we cannot currently

anticipate whether the scope and cost of such coverage will compare favorably to stand-alone terrorism insurance, and thus whether it will be commercially reasonable for us to change our coverage for acts of terrorism going forward. We will continue to monitor the state of the insurance market, but we do not currently expect that coverage for acts of terrorism on terms comparable to pre-2002 policies will become available on commercially reasonable terms.

We carry earthquake insurance on our properties located in areas known to be subject to earthquakes in an amount and subject to deductibles and self-insurance that we believe are commercially reasonable. However, the amount of our earthquake insurance coverage may not be sufficient to cover losses from earthquakes. As a result of increased costs of coverage and decreased availability, the amount of third party earthquake insurance we may be able to purchase on commercially reasonable terms may be reduced. In addition, we may discontinue earthquake insurance on some or all of our properties in the future if the premiums exceed our estimation of the value of the coverage.

In January 2002, the Company formed a wholly-owned insurance subsidiary, IXP, Inc. ("IXP"), to act as a captive insurance company and be one of the elements of our overall insurance program. IXP has acted as a reinsurer for our primary carrier with respect to a portion of our earthquake insurance coverage for our Greater San Francisco properties. In the future IXP may provide additional or different coverage, as a reinsurer or a primary insurer, depending on the availability and cost of third party insurance in the marketplace and the level of self insurance that we believe is commercially reasonable. The accounts of IXP are consolidated within the Company.

There are other types of losses, such as from wars, acts of bio-terrorism or the presence of mold at our properties, for which we cannot obtain insurance at all or at a reasonable cost. With respect to such losses and losses from acts of terrorism, earthquakes or other catastrophic events, if we experience a loss that is uninsured or that exceeds policy limits, we could lose the capital invested in the damaged properties, as well as the anticipated future revenues from those properties. Depending on the specific circumstances of each affected property, it is possible that we could be liable for mortgage indebtedness or other obligations related to the property. Any such loss could materially and adversely affect our business and financial condition and results of operations.

Potential liability for environmental contamination could result in substantial costs.

Under federal, state and local environmental laws, ordinances and regulations, we may be required to investigate and clean up the effects of releases of hazardous or toxic substances or petroleum products at our properties simply because of our current or past ownership or operation of the real estate. If unidentified environmental problems arise, we may have to make substantial payments which could adversely affect our cash flow and our ability to make distributions to our securityholders because:

•: as owner or operator we may have to pay for property damage and for investigation and clean-up costs incurred in connection with the contamination;
•: the law typically imposes clean-up responsibility and liability regardless of whether the owner or operator knew of or caused the contamination;
•: even if more than one person may be responsible for the contamination, each person who shares legal liability under the environmental laws may be held responsible for all of the clean-up costs; and
•: governmental entities and third parties may sue the owner or operator of a contaminated site for damages and costs.

These costs could be substantial and in extreme cases could exceed the value of the contaminated property. The presence of hazardous or toxic substances or petroleum products or the failure to properly remediate contamination may materially and adversely affect our ability to borrow against, sell or rent an affected property. In addition, applicable environmental laws create liens on contaminated sites in favor of the government for damages and costs it incurs in connection with a contamination. Changes in laws increasing the potential liability for environmental conditions existing at our properties, or increasing the restrictions on the handling, storage or discharge of hazardous or toxic substances or petroleum products or other actions may result in significant unanticipated expenditures.

Environmental laws also govern the presence, maintenance and removal of asbestos. Such laws require that owners or operators of buildings containing asbestos:

•: properly manage and maintain the asbestos;
•: notify and train those who may come into contact with asbestos; and
•: undertake special precautions, including removal or other abatement, if asbestos would be disturbed during renovation or demolition of a building.

Such laws may impose fines and penalties on building owners or operators who fail to comply with these requirements and may allow third parties to seek recovery from owners or operators for personal injury associated with exposure to asbestos fibers. Some of our properties are located in urban, industrial and previously developed areas where fill or current or historic industrial uses of the areas have caused site contamination.

It is our policy to retain independent environmental consultants to conduct Phase I environmental site assessments and asbestos surveys with respect to our acquisition of properties. These assessments generally include a visual inspection of the properties and the surrounding areas, an examination of current and historical uses of the properties and the surrounding areas and a review of relevant state, federal and historical documents, but do not involve invasive techniques such as soil and ground water sampling. Where appropriate, on a property-by-property basis, our practice is to have these consultants conduct additional testing, including sampling for asbestos, for lead in drinking water, for soil contamination where underground storage tanks are or were located or where other past site usages create a potential environmental problem, and for contamination in groundwater. Even though these environmental assessments are conducted, there is still the risk that:

•: the environmental assessments and updates did not identify all potential environmental liabilities;
•: a prior owner created a material environmental condition that is not known to us or the independent consultants preparing the assessments;
•: new environmental liabilities have developed since the environmental assessments were conducted; and
•: future uses or conditions such as changes in applicable environmental laws and regulations could result in environmental liability for us.

While we test indoor air quality on a regular basis and have an ongoing maintenance program in place to address this aspect of property operations, inquiries about indoor air quality may necessitate special investigation and, depending on the results, remediation. Indoor air quality issues can stem from inadequate ventilation, chemical contaminants from indoor or outdoor sources, and biological contaminants such as molds, pollen, viruses and bacteria. Indoor exposure to chemical or biological contaminants above certain levels can be alleged to be connected to allergic reactions or other health effects and symptoms in susceptible individuals. If these conditions were to occur at one of our properties, we may need to undertake a targeted remediation program, including without limitation,

steps to increase indoor ventilation rates and eliminate sources of contaminants. Such remediation programs could be costly, necessitate the temporary relocation of some or all of the property's tenants or require rehabilitation of the affected property.

We face risks associated with the use of debt to fund acquisitions and developments, including refinancing risk.

We are subject to the risks normally associated with debt financing, including the risk that our cash flow will be insufficient to meet required payments of principal and interest. We anticipate that only a small portion of the principal of our debt will be repaid prior to maturity. Therefore, we are likely to need to refinance at least a portion of our outstanding debt as it matures. There is a risk that we may not be able to refinance existing debt or that the terms of any refinancing will not be as favorable as the terms of our existing debt. If principal payments due at maturity cannot be refinanced, extended or repaid with proceeds from other sources, such as new equity capital, our cash flow will not be sufficient to repay all maturing debt in years when significant "balloon" payments come due.

We have agreements with a number of limited partners of Boston Properties Limited Partnership who contributed properties in exchange for partnership interests that require Boston Properties Limited Partnership to maintain secured debt on certain of our assets and/or allocate partnership debt to such limited partners to enable them to continue to defer recognition of their taxable gain with respect to the contributed property. These tax protection and debt allocation agreements may restrict our ability to repay or refinance debt.

An increase in interest rates would increase our interest costs on variable rate debt and could adversely impact our ability to refinance existing debt.

We currently have, and may incur more, indebtedness that bears interest at variable rates. Accordingly, if interest rates increase, so will our interest costs, which would adversely affect our cash flow and our ability to pay principal and interest on our debt and our ability to make distributions to our securityholders. Further, rising interest rates could limit our ability to refinance existing debt when it matures. As a protection against rising interest rates, we enter into agreements such as interest rate swaps, caps, floors and other interest rate hedging contracts.

Covenants in our debt agreements could adversely affect our financial condition.

The mortgages on our properties contain customary covenants such as those that limit our ability, without the prior consent of the lender, to further mortgage the applicable property or to discontinue insurance coverage. Our credit facilities and unsecured debt securities contain customary restrictions, requirements and other limitations on our ability to incur indebtedness, including total debt to asset ratios, secured debt to total asset ratios, debt service coverage ratios and minimum ratios of unencumbered assets to unsecured debt which we must maintain. Our continued ability to borrow under our credit facilities is subject to compliance with our financial and other covenants. In addition, our failure to comply with such covenants could cause a default under the applicable debt agreement, and we may then be required to repay such debt with capital from other sources. Under those circumstances, other sources of capital may not be available to us, or be available only on unattractive terms.

Our "all risk" insurance policies contain exclusions for acts of terrorism and some of our lenders may take the position that our insurance coverage against acts of terrorism no longer complies with covenants in our debt agreements. Additionally, in the future our ability to obtain debt financing, or the terms of such financing, may be adversely affected if lenders generally insist upon greater insurance coverage against acts of terrorism than is available to us in the marketplace on commercially reasonable terms.

We rely on debt financing, including borrowings under our credit facilities, issuances of unsecured debt securities and debt secured by individual properties, to finance our acquisition and development activities and for working capital. If we are unable to obtain debt financing from these or other sources, or to refinance existing indebtedness upon maturity, our financial condition and results of operations would likely be adversely affected. If we breach covenants in our debt agreements, the lenders can declare a default and, if the debt is secured, can take possession of the property securing the defaulted loan. In addition, our unsecured debt agreements contain specific cross-default provisions with respect to specified other indebtedness, giving the unsecured lenders the right to declare a default if we are in default under other loans in some circumstances. Defaults under our debt agreements could materially and adversely affect our financial condition and results of operations.

Our degree of leverage could limit our ability to obtain additional financing or affect the market price of our common stock.

Debt to market capitalization ratio is a measure of our total debt as a percentage of the aggregate of our total debt plus the market value of our outstanding common stock and interests in Boston Properties Limited Partnership. Our debt to market capitalization ratio was approximately 52.8% as of December 31, 2002. Our degree of leverage could affect our ability to obtain additional financing for working capital, capital expenditures, acquisitions, development or other general corporate purposes. Our senior unsecured debt is currently rated investment grade by the three major rating agencies. However, there can be no assurance we will be able to maintain this rating, and in the event our senior debt is downgraded from its current rating, we would likely incur higher borrowing costs. Our degree of leverage could also make us more vulnerable to a downturn in business or the economy generally.

Further issuances of equity securities may be dilutive to current securityholders.

The interests of our existing securityholders could be diluted if additional equity securities are issued to finance future developments, acquisitions, or repay indebtedness. Our ability to execute our business strategy depends on our access to an appropriate blend of debt financing, including unsecured lines of credit and other forms of secured and unsecured debt, and equity financing, including common and preferred equity.

Failure to qualify as a real estate investment trust would cause us to be taxed as a corporation, which would substantially reduce funds available for payment of dividends.

If we fail to qualify as a real estate investment trust for federal income tax purposes, we will be taxed as a corporation. We believe that we are organized and qualified as a real estate investment trust, and intend to operate in a manner that will allow us to continue to qualify as a real estate investment trust. However, we cannot assure you that we are qualified as such, or that we will remain qualified as such in the future. This is because qualification as a real estate investment trust involves the application of highly technical and complex provisions of the Internal Revenue Code as to which there are only limited judicial and administrative interpretations, and involves the determination of facts and circumstances not entirely within our control. In addition, future legislation, new regulations, administrative interpretations or court decisions may significantly change the tax laws or the application of the tax laws with respect to qualification as a real estate investment trust for federal income tax purposes or the federal income tax consequences of such qualification.

If we fail to qualify as a real estate investment trust we will face serious tax consequences that will substantially reduce the funds available for payment of dividends for each of the years involved because:

•: we would not be allowed a deduction for dividends paid to stockholders in computing our taxable income and would be subject to federal income tax at regular corporate rates;

•: we also could be subject to the federal alternative minimum tax and possibly increased state and local taxes;
•: unless we are entitled to relief under statutory provisions, we could not elect to be subject to tax as a real estate investment trust for four taxable years following the year during which we were disqualified; and
•: all dividends will be subject to tax as ordinary income to the extent of our current and accumulated earnings and profits.

In addition, if we fail to qualify as a real estate investment trust, we will no longer be required to pay dividends. As a result of all these factors, our failure to qualify as a real estate investment trust could impair our ability to expand our business and raise capital, and would adversely affect the value of our common stock.

In order to maintain our real estate investment trust status, we may be forced to borrow funds on a short-term basis during unfavorable market conditions.

In order to maintain our real estate investment trust status, we may need to borrow funds on a short-term basis to meet the real estate investment trust distribution requirements, even if the then prevailing market conditions are not favorable for these borrowings. To qualify as a real estate investment trust, we generally must distribute to our stockholders at least 90% of our net taxable income each year, excluding capital gains. In addition, we will be subject to a 4% nondeductible excise tax on the amount, if any, by which dividends paid by us in any calendar year are less than the sum of 85% of our ordinary income, 95% of our capital gain net income and 100% of our undistributed income from prior years. We may need short-term debt to fund required distributions as a result of differences in timing between the actual receipt of income and the recognition of income for federal income tax purposes, or the effect of non-deductible capital expenditures, the creation of reserves or required debt or amortization payments.

Limits on changes in control may discourage takeover attempts beneficial to stockholders.

Provisions in our certificate of incorporation and bylaws, our shareholder rights agreement and the limited partnership agreement of Boston Properties Limited Partnership, as well as provisions of the Internal Revenue Code and Delaware corporate law, may:

•: delay or prevent a change of control over us or a tender offer, even if such action might be beneficial to our stockholders and
•: limit our stockholders' opportunity to receive a potential premium for their shares of common stock over then-prevailing market prices.

Stock Ownership Limit

Primarily to facilitate maintenance of our qualification as a real estate investment trust, our certificate of incorporation generally prohibits ownership, directly, indirectly or beneficially, by any single stockholder of more than 6.6% of the number of outstanding shares of any class or series of our equity stock. We refer to this limitation as the "ownership limit." Our board of directors may waive or modify the ownership limit with respect to one or more persons if it is satisfied that ownership in excess of this limit will not jeopardize our status as a real estate investment trust for federal income tax purposes. In addition, under our certificate of incorporation each of Mortimer B. Zuckerman and Edward H. Linde, along with their respective families and affiliates, as well as, in general, pension plans and mutual funds, may actually and beneficially own up to 15% of the number of outstanding shares of any class or series of our equity common stock. Shares owned in violation of the ownership limit will be subject to the loss of rights to distributions and voting and other penalties. The ownership limit may have the effect of inhibiting or impeding a change in control.

Boston Properties Limited Partnership Agreement

We have agreed in the limited partnership agreement of Boston Properties Limited Partnership not to engage in business combinations unless limited partners of Boston Properties Limited Partnership other than Boston Properties, Inc. receive, or have the opportunity to receive, the same consideration for their partnership interests as holders of our common stock in the transaction. If these limited partners do not receive such consideration, we cannot engage in the transaction unless 75% of these limited partners vote to approve the transaction. In addition, we have agreed in the limited partnership agreement of Boston Properties Limited Partnership that we will not consummate business combinations in which we received the approval of our stockholders unless these limited partners are also allowed to vote and the transaction would have been approved had these limited partners been able to vote as stockholders on the transaction. Therefore, if our stockholders approve a business combination that requires a vote of stockholders, the partnership agreement requires the following before we can consummate the transaction:

•: holders of partnership interests in Boston Properties Limited Partnership, including Boston Properties, Inc., must vote on the matter;
•: Boston Properties, Inc. must vote its partnership interests in the same proportion as our stockholders voted on the transaction; and
•: the result of the vote of holders of partnership interests in Boston Properties Limited Partnership must be such that had such vote been a vote of stockholders, the business combination would have been approved.

As a result of these provisions, a potential acquirer may be deterred from making an acquisition proposal and we may be prohibited by contract from engaging in a proposed business combination even though our stockholders approve of the combination.

Shareholder Rights Plan

We have adopted a shareholder rights plan. Under the terms of this plan, we can in effect prevent a person or group from acquiring more than 15% of the outstanding shares of our common stock, because, unless we approve of the acquisition, after the person acquires more than 15% of our outstanding common stock, all other stockholders will have the right to purchase securities from us at a price that is less than their then fair market value, which would substantially reduce the value and influence of the stock owned by the acquiring person. Our board of directors can prevent the plan from operating by approving the transaction in advance, which gives us significant power to approve or disapprove of the efforts of a person or group to acquire a large interest in our company.

We may change our policies without obtaining the approval of our stockholders.

Our operating and financial policies, including our policies with respect to acquisitions, growth, operations, indebtedness, capitalization and dividends, are determined by our board of directors. Accordingly, as a stockholder, you will have little direct control over these policies.

Our success depends on key personnel whose continued service is not guaranteed.

We depend on the efforts of key personnel, particularly Mortimer B. Zuckerman, Chairman of our board of directors, and Edward H. Linde, our President and Chief Executive Officer. Among the reasons that Messrs. Zuckerman and Linde are important to our success is that each has a national reputation which attracts business and investment opportunities and assists us in negotiations with lenders. If we lost their services, our relationships with lenders, potential tenants and industry personnel would diminish. Mr. Zuckerman has substantial outside business interests which could interfere with his ability to devote his full time to our business and affairs.

Our two Executive Vice Presidents, Chief Financial Officer and other executive officers who serve as managers of our regional offices have strong reputations. Their reputations aid us in identifying opportunities, having opportunities brought to us, and negotiating with tenants and build-to-suit prospects. While we believe that we could find replacements for these key personnel, the loss of their services could materially and adversely affect our operations because of diminished relationships with lenders, prospective tenants and industry personnel.

Conflicts of interest exist with holders of interests in Boston Properties Limited Partnership.

Sales of properties and repayment of related indebtedness will have different effects on holders of interests in Boston Properties Limited Partnership than on our stockholders.

Some holders of interests in Boston Properties Limited Partnership, including Messrs. Zuckerman and Linde, would incur adverse tax consequences upon the sale of certain of our properties and on the repayment of related debt which differ from the tax consequences to us and our stockholders. Consequently, such holders of partnership interests in Boston Properties Limited Partnership may have different objectives regarding the appropriate pricing and timing of any such sale or repayment of debt. While we have exclusive authority under the limited partnership agreement of Boston Properties Limited Partnership to determine when to refinance or repay debt or whether, when, and on what terms to sell a property, subject, in the case of certain properties, to the contractual commitments described below, any such decision would require the approval of our board of directors. As directors and executive officers, Messrs. Zuckerman and Linde have substantial influence with respect to any such decision. Their influence could be exercised in a manner inconsistent with the interests of some, or a majority, of our stockholders, including in a manner which could prevent completion of a sale of a property or the repayment of indebtedness.

Agreement not to sell some properties.

Under the terms of the limited partnership agreement of Boston Properties Limited Partnership, we have agreed not to sell or otherwise transfer some of our properties, prior to specified dates, in any transaction that would trigger taxable income, without first obtaining the consent of Messrs. Zuckerman and Linde. However, we are not required to obtain their consent if, during the applicable period, each of them does not hold at least 30% of his original interests in Boston Properties Limited Partnership, or if those properties are transferred in a nontaxable event. In addition, we have entered into similar agreements with respect to other properties that we have acquired in exchange for partnership interests in Boston Properties Limited Partnership. Pursuant to those agreements, we are responsible for the reimbursement of tax costs to the prior owners if the subject properties are sold in a taxable sale. Our obligations to the prior owners are generally limited in time and only apply to actual damages suffered. As of December 31, 2002, there were a total of 34 properties subject to these restrictions, and those 34 properties and 2 additional properties sold during 2002, are estimated to have accounted for approximately 54.6% of our total revenue for the year ended December 31, 2002.

Boston Properties Limited Partnership has also entered into agreements providing prior owners with the right to guarantee specific amounts of indebtedness and, in the event that the specific indebtedness they guarantee is repaid or reduced, additional and/or substitute indebtedness. These agreements may hinder actions that we may otherwise desire to take to repay or refinance guaranteed indebtedness because we would be required to make payments to the beneficiaries of such agreements if we violate these agreements.

Messrs. Zuckerman and Linde will continue to engage in other activities.

Messrs. Zuckerman and Linde have a broad and varied range of investment interests. Either one could acquire an interest in a company which is not currently involved in real estate investment activities but

which may acquire real property in the future. However, pursuant to each of their employment agreements, Messrs. Zuckerman and Linde will not, in general, have management control over such companies and, therefore, they may not be able to prevent one or more such companies from engaging in activities that are in competition with our activities.

Changes in market conditions could adversely affect the market price of our common stock.

As with other publicly traded equity securities, the value of our common stock depends on various market conditions which may change from time to time. Among the market conditions that may affect the value of our common stock are the following:

•: the extent of investor interest in our securities;
•: the general reputation of real estate investment trusts and the attractiveness of our equity securities in comparison to other equity securities, including securities issued by other real estate-based companies;
•: our underlying asset value;
•: investor confidence in the stock and bond market, generally;
•: national economic conditions;
•: changes in tax laws;
•: our financial performance;
•: change in our credit rating; and
•: general stock and bond market conditions.

The market value of our common stock is based primarily upon the market's perception of our growth potential and our current and potential future earnings and cash dividends. Consequently, our common stock may trade at prices that are higher or lower than our net asset value per share of common stock. If our future earnings or cash dividends are less than expected, it is likely that the market price of our common stock will diminish.

The number of shares available for future sale could adversely affect the market price of our stock.

As part of our initial public offering and since then we have completed many private placement transactions where shares of capital stock of Boston Properties, Inc. or interests in Boston Properties Limited Partnership were issued to owners of properties we acquired or to institutional investors. This common stock, or common stock issuable on conversion of our preferred stock or in exchange for such interests in Boston Properties Limited Partnership, may be sold in the public securities markets over time pursuant to registration rights we granted to these investors. Additional common stock reserved under our employee benefit and other incentive plans, including stock options and restricted stock, may also be sold in the market at some time in the future. Future sales of our common stock in the market could adversely affect the price of our common stock. We cannot predict the effect the perception in the market that such sales may occur will have on the market price of our common stock.

We did not obtain new owner's title insurance policies in connection with properties acquired during our initial public offering.

We acquired many of our properties from our predecessors at the completion of our initial public offering in June 1997. Before we acquired these properties each of them was insured by a title insurance policy. We did not, however, obtain new owner's title insurance policies in connection with the acquisition of these properties. Nevertheless, because in many instances we acquired these

properties indirectly by acquiring ownership of the entity which owned the property and those owners remain in existence as our subsidiaries, some of these title insurance policies may continue to benefit us. Many of these title insurance policies may be for amounts less than the current values of the applicable properties. If there was a title defect related to any of these properties, or to any of the properties acquired at the time of our initial public offering, that is no longer covered by a title insurance policy, we could lose both our capital invested in and our anticipated profits from such property. We have obtained title insurance policies for all properties that we have acquired after our initial public offering.

We face possible adverse changes in tax laws.

From time to time changes in state and local tax laws or regulations are enacted, which may result in increase in our tax liability. The shortfall in tax revenues for states and municipalities in recent years may lead to an increase in the frequency and size of such changes. We also face the risk that taxing authorities may challenge certain aspects of our acquisition, operation or disposition of properties. If such challenges are successful, we may be required to pay additional taxes on our assets or income and may be assessed interest and penalties on such additional taxes. These increased tax costs could adversely affect our financial condition and results of operations and the amount of cash available for payment of dividends.

Item 2. Properties

At December 31, 2002, our portfolio consisted of 142 properties totaling 42.4 million net rentable square feet. Our properties consisted of 133 office properties, including 105 Class A office buildings and 28 properties that support both office and technical uses, including five properties under construction, four industrial properties, two retail properties, including one retail property currently under construction, and three hotels. In addition, we own or control 41 parcels of land for future development. The following table sets forth information relating to the properties we owned at December 31, 2002:

Properties		Location	12/31/02 Occupancy		Number of Buildings	Net Rentable Square Feet
Class A Office
	399 Park Avenue	New York, NY	100.0	%	1	1,677,433
	Citigroup Center	New York, NY	99.9	%	1	1,576,803
	800 Boylston Street at The Prudential Center	Boston, MA	92.2	%	1	1,175,218
	280 Park Avenue	New York, NY	97.6	%	1	1,166,777
	5 Times Square	New York, NY	98.8	%	1	1,103,290
	599 Lexington Avenue	New York, NY	95.9	%	1	1,019,772
	Embarcadero Center Four	San Francisco, CA	93.1	%	1	935,821
	Riverfront Plaza	Richmond, VA	91.8	%	1	899,586
	111 Huntington Avenue at The Prudential Center	Boston, MA	98.2	%	1	854,129
	Embarcadero Center One	San Francisco, CA	97.8	%	1	833,727
	Embarcadero Center Two	San Francisco, CA	88.3	%	1	780,441
	Embarcadero Center Three	San Francisco, CA	89.1	%	1	773,632
	875 Third Avenue(1)	New York, NY	95.2	%	1	711,901
	Democracy Center	Bethesda, MD	94.0	%	3	680,854
	100 East Pratt Street	Baltimore, MD	98.2	%	1	635,323
	Metropolitan Square (51% ownership)	Washington, D.C.	97.6	%	1	585,220
	Shops at the Prudential Center(2)	Boston, MA	97.6	%	1	557,946
	Candler Building(3)	Baltimore, MD	97.0	%	1	540,706
	Reservoir Place	Waltham, MA	84.7	%	1	522,760
	101 Huntington Avenue at the Prudential Center	Boston, MA	80.9	%	1	510,983
	601 and 651 Gateway Boulevard	South San Francisco, CA	86.1	%	2	509,720
	West Tower	San Francisco, CA	96.1	%	1	467,781
	One Tower Center	East Brunswick, NJ	84.4	%	1	410,887
	One Freedom Square (25% ownership)	Reston, VA	100.0	%	1	410,308
	Market Square North (50% ownership)	Washington, D.C.	100.0	%	1	401,279
	Capital Gallery	Washington, D.C.	100.0	%	1	396,894
	140 Kendrick Street (25% ownership)	Needham, MA	100.0	%	3	380,987
	One and Two Discovery Square (50% ownership)	Reston, VA	90.8	%	2	366,989
	265 Franklin Street (35% ownership)	Boston, MA	67.9	%	1	343,913
	Orbital Science Campus	Dulles, VA	100.0	%	3	337,228
	One Reston Overlook	Reston, VA	100.0	%	1	312,685
	2300 N Street	Washington, D.C.	98.8	%	1	289,243

NIMA Building	Reston, VA	100.0	%	1	263,870
Reston Corporate Center	Reston, VA	100.0	%	2	261,046
Quorum Office Park One	Chelmsford, MA	100.0	%	2	259,918
Lockheed Martin Building	Reston, VA	100.0	%	1	255,244
611 Gateway Boulevard	S. San Francisco, CA	0.0	%	1	250,825
200 West Street	Waltham, MA	100.0	%	1	248,048
500 E Street	Washington, D.C.	100.0	%	1	242,769
New Dominion Tech. Park, Building One	Herndon, VA	100.0	%	1	235,201
510 Carnegie Center	Princeton, NJ	100.0	%	1	234,160
Cambridge Center One	Cambridge, MA	94.0	%	1	215,385
Sumner Square Office	Washington, D.C.	100.0	%	1	207,620
University Place	Cambridge, MA	100.0	%	1	195,282
1301 New York Avenue	Washington, D.C.	100.0	%	1	188,358
2600 Tower Oaks Boulevard	Rockville, MD	100.0	%	1	178,887
Cambridge Center Eight	Cambridge, MA	100.0	%	1	177,226
Newport Office Park	Quincy, MA	44.6	%	1	168,829
Lexington Office Park	Bedford, MA	78.6	%	2	167,293
191 Spring Street	Waltham, MA	100.0	%	1	162,700
206 Carnegie Center	Princeton, NJ	100.0	%	1	161,763
210 Carnegie Center	Princeton, NJ	100.0	%	1	161,112
10 & 20 Burlington Mall Road	Burlington, MA	88.7	%	2	156,416
Cambridge Center Ten	Cambridge, MA	100.0	%	1	152,664
Old Federal Reserve	San Francisco, CA	99.8	%	1	149,592
214 Carnegie Center	Princeton, NJ	94.8	%	1	148,584
212 Carnegie Center	Princeton, NJ	100.0	%	1	146,518
506 Carnegie Center	Princeton, NJ	56.2	%	1	136,213
Two Reston Overlook	Reston, VA	82.2	%	1	131,594
508 Carnegie Center	Princeton, NJ	100.0	%	1	131,085
Waltham Office Center	Waltham, MA	84.8	%	3	130,209
202 Carnegie Center	Princeton, NJ	100.0	%	1	128,705
504 Carnegie Center	Princeton, NJ	100.0	%	1	121,990
91 Hartwell Avenue	Lexington, MA	91.3	%	1	121,215
Montvale Center	Gaithersburg, MD	84.2	%	1	120,823
40 Shattuck Road	Andover, MA	92.2	%	1	120,000
101 Carnegie Center	Princeton, NJ	100.0	%	1	119,652
502 Carnegie Center	Princeton, NJ	95.3	%	1	116,374
Cambridge Center Three	Cambridge, MA	100.0	%	1	107,484
104 Carnegie Center	Princeton, NJ	85.2	%	1	102,830
201 Spring Street	Waltham, MA	100.0	%	1	102,500
The Arboretum	Reston, VA	100.0	%	1	95,584
Bedford Office Park	Bedford, MA	100.0	%	1	90,000
Cambridge Center Eleven	Cambridge, MA	100.0	%	1	79,616
Decoverly Two	Rockville, MD	100.0	%	1	77,747
Decoverly Three	Rockville, MD	100.0	%	1	77,040
33 Hayden Avenue	Lexington, MA	100.0	%	1	75,216
170 Tracer Lane	Waltham, MA	55.0	%	1	73,258
105 Carnegie Center	Princeton, NJ	100.0	%	1	69,648
32 Hartwell Avenue	Lexington, MA	100.0	%	1	69,154

	302 Carnegie Center		Princeton, NJ	95.5	%	1	65,135
	195 West Street		Waltham, MA	100.0	%	1	63,500
	100 Hayden Avenue		Lexington, MA	100.0	%	1	55,924
	181 Spring Street		Waltham, MA	41.2	%	1	53,595
	211 Carnegie Center		Princeton, NJ	100.0	%	1	47,025
	204 Second Avenue		Waltham, MA	100.0	%	1	40,974
	92 Hayden Avenue		Lexington, MA	100.0	%	1	31,100
	201 Carnegie Center		Princeton, NJ	100.0	%	—	6,500

		Subtotal for Class A Office Properties		94.1	%	101	29,921,236

Office/Technical Properties
	Bedford Office Park		Bedford, MA	100.0	%	2	383,704
	Hilltop Office Center		South San Francisco, CA	87.5	%	9	144,366
	Broad Run Business Park, Building E		Dulles,VA	54.7	%	1	127,226
	7601 Boston Boulevard		Springfield, VA	100.0	%	1	103,750
	7399-7435 Boston Boulevard		Springfield, VA	82.3	%	1	103,557
	8000 Grainger Court		Springfield, VA	100.0	%	1	90,645
	7500 Boston Boulevard		Springfield, VA	100.0	%	1	79,971
	7501 Boston Boulevard		Springfield, VA	100.0	%	1	75,756
	Cambridge Center Fourteen		Cambridge, MA	100.0	%	1	67,362
	164 Lexington Road		Billerica, MA	100.0	%	1	64,140
	7450 Boston Boulevard		Springfield, VA	100.0	%	1	62,402
	Sugarland Business Park, Building Two		Herndon, VA	65.9	%	1	59,215
	7374 Boston Boulevard		Springfield, VA	100.0	%	1	57,321
	Sugarland Business Park, Building One		Herndon, VA	22.8	%	1	52,797
	8000 Corporate Court		Springfield, VA	100.0	%	1	52,539
	7451 Boston Boulevard		Springfield, VA	66.1	%	1	47,001
	7300 Boston Boulevard		Springfield, VA	100.0	%	1	32,000
	17 Hartwell Avenue		Waltham, MA	100.0	%	1	30,000
	7375 Boston Boulevard		Springfield, VA	100.0	%	1	26,865

		Subtotal for Office/Technical Properties		89.7	%	28	1,660,617

Industrial Properties
	38 Cabot Boulevard		Bucks County, PA	100.0	%	1	161,000
	40-46 Harvard Street		Westwood, MA	100.0	%	1	152,009
	560 Forbes Blvd		South San Francisco, CA	100.0	%	1	40,000
	430 Rozzi Place		South San Francisco, CA	100.0	%	1	20,000

		Subtotal for Industrial Properties		100.0	%	4	373,009

		Subtotal for In-Service Properties		93.9	%	133	31,954,862

Properties Under Construction
	Times Square Tower		New York, NY	0	%(4)	1	1,218,511
	901 New York Avenue (25% ownership)		Washington, D.C.	60.0	%(4)	1	538,463
	Two Freedom Square (50% ownership)		Reston, VA	65.0	%(4)	1	422,930
	Waltham Weston Corporate Center		Waltham, MA	42.1	%(4)	1	304,050

	New Dominion Tech. Park, Building Two		Herndon, VA	100.0	%(4)	1	257,400
	Shaws Supermarket(2)		Boston, MA	100.0	%(4)	1	57,235

		Subtotal for Properties Under Construction		37.2	%(4)	6	2,798,589

Hotel Properties
	Long Wharf Marriott		Boston, MA	N/M		1	420,000
	Cambridge Center Marriott		Cambridge, MA	N/M		1	330,400
	Residence Inn by Marriott		Cambridge, MA	N/M		1	187,474

		Subtotal for Hotel Properties				3	937,874

Structured Parking						—	6,719,991

	Total Portfolio:					142	42,411,316

(1): Sold on February 4, 2003.
(2): Retail property.
(3): Sold on January 28, 2003.
(4): Represents pre-leasing at December 31, 2002.

N/M—Not meaningful.

Top 20 Tenants by Square Feet

Tenant		Square Feet	% of In Service 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.	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	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	% (1)
	Total % of portfolio revenue		32.74	% (2)

(1): Includes 646,609 square feet or 2.02% of the portfolio in which we own a joint venture interest.
(2): Includes $19.1 million or 1.58% of revenues from properties in which we own a joint venture interest.

Lease Expirations

Year of Lease Expiration	Rentable Square Footage Subject to Expiring Leases	Current Annualized(1) Revenues Under Expiring Leases		Current Annualized(1) Revenues Under Expiring Leases p.s.f.			Annualized(1) Revenues Under Expiring Leases with future step ups		Annualized(1) Revenues Under Expiring Leases with future step-ups p.s.f.		Percentage of Total Square Feet
2003	1,644,474	$	52,844,755	$	32.13	(2)	$	53,094,939	$	32.29	5.15	%
2004	2,559,104		92,793,601		36.26			93,366,005		36.48	8.01	%
2005	2,690,726		97,902,119		36.39			100,905,670		37.50	8.42	%
2006	3,562,432		138,867,900		38.98			143,776,456		40.36	11.15	%
2007	2,671,419		94,714,813		35.45			99,211,635		37.14	8.36	%
2008	1,437,372		59,848,925		41.64			59,648,168		41.50	4.50	%
2009	2,468,327		90,948,175		36.85			99,974,527		40.50	7.72	%
2010	1,476,004		64,244,167		43.53			72,656,818		49.23	4.62	%
2011	2,846,193		111,161,486		39.06			127,919,813		44.94	8.91	%
2012	2,186,739		96,735,475		44.24			106,321,851		48.62	6.84	%
Thereafter	6,264,880		305,165,632		48.71			372,601,943		59.47	19.61	%

(1): Annualized revenues are the monthly contractual rent under existing leases as of December 31, 2002 multiplied by twelve. This amount reflects total rent before any rent abatements and includes expense reimbursements, which may be estimates as of such date.
(2): Includes $2.3 million of annual revenue from the Prudential Center retail kiosks for which there is zero square footage assigned.

Item 3. Legal Proceedings

Neither we, nor our affiliates, are presently subject to any material litigation or, to our knowledge, have any litigation threatened against us or our affiliates other than routine actions and administrative proceedings substantially all of which are expected to be covered by liability or other insurance and in the aggregate are not expected to have a material adverse effect on our business or financial condition.

Item 4. Submission of Matters to a Vote of Security Holders

No matters were submitted to a vote of our stockholders during the fourth quarter of the year ended December 31, 2002.

PART II

Item 5. Market for Registrant's Common Equity and Related Stockholder Matters

Our common stock is listed on the New York Stock Exchange under the symbol "BXP." The high and low closing sales prices for the periods indicated in the table below were:

Quarter Ended	High		Low		Distributions
December 31, 2002	$	37.43	$	33.93	$	.610	(a)
September 30, 2002		39.87		34.56		.610
June 30, 2002		41.55		37.88		.610
March 31, 2002		39.82		35.98		.580
December 31, 2001		38.41		34.33		.580
September 30, 2001		41.26		36.20		.580
June 30, 2001		41.06		36.47		.580
March 31, 2001		43.31		37.92		.530

(a): Paid on January 29, 2003 to stockholders of record on December 30, 2002.

At February 19, 2003, we had approximately 820 stockholders of record. This does not include beneficial owners for whom Cede & Co. or others act as nominee.

We have adopted a policy of paying regular quarterly distributions on our common stock and cash distributions have been paid on our common stock since our initial public offering. In order to maintain our qualification as a REIT, we must make annual distributions to our stockholders of at least 90% of our taxable income (not including net capital gains).

Item 6. Selected Financial Data

The following table sets forth our selected financial and operating data. The following data should be read in conjunction with our financial statements and notes thereto and Management's Discussion and Analysis of Financial Condition and Results of Operations included elsewhere in this Form 10-K.

Our historical operating results may not be comparable to our future operating results.

			For the year ended December 31,
			2002			2001			2000			1999			1998
			(in thousands, except per share data)
Statement of Operations Information:
Total revenue			$	1,234,823		$	1,046,520		$	889,631		$	781,009		$	509,212

Expenses:
	Rental operating			385,491			330,301			279,671			248,386			149,582
	Hotel oerating			31,086			—			—			—			—
	General and administrative			47,292			38,312			35,659			29,455			22,504
	Interest			271,685			223,389			217,064			205,410			124,793
	Depreciation and amortization			186,177			149,181			132,223			119,204			74,594
	Net derivative losses			11,874			26,488			—			—			—
	Loss on investments in securities			4,297			6,500			—			—			—

	Income before income from unconsolidated joint ventures, net derivative losses and minority interests			296,921			272,349			225,014			178,554			137,739
	Income from unconsolidated joint ventures			7,954			4,186			1,758			468			—
	Minority interests			(75,459	)		(73,654	)		(76,020	)		(68,520	)		(41,260	)

	Income before gain (loss) on sale of real estate			229,416			202,881			150,752			110,502			96,479
	Gain (loss) on sale of real estate, net of minority interest			186,810			6,505			(234	)		6,467			—
	Gain on sale of land held for development, net of minority interest			3,633			2,584			—			—			—

	Income before discontinued operations			419,859			211,970			150,518			116,969			96,479
	Discontinued operations, net of minority interest			26,480			2,829			2,814			2,807			2,114

	Income before extraordinary items			446,339			214,799			153,332			119,776			98,593
	Extraordinary gain (loss), net of minority interest			(1,956	)		—			(334	)		—			(5,481	)

	Income before cumulative effect of a change in accounting principle			444,383			214,799			152,998			119,776			93,112
	Cumulative effect of a change in accounting principle, net of minority interest			—			(6,767	)		—			—			—

	Net income before preferred dividend			444,383			208,032			152,998			119,776			93,112
	Preferred dividend			(3,412	)		(6,592	)		(6,572	)		(5,829	)		—

	Net income available to common shareholders		$	440,971		$	201,440		$	146,426		$	113,947		$	93,112

	Basic earnings per share:
		Income before discontinued operations, extraordinary items and cumulative effect of a change in accounting principle	$	4.47		$	2.28		$	2.01		$	1.69		$	1.59
		Discontinued operations, net of minority interest		0.28			0.03			0.04			0.03			0.03
		Extraordinary gain (loss), net of minority interest		(0.02	)		—			—			—			(0.09	)
		Cumulative effect of a change in accounting principle, net of minority interest		—			(0.07	)		—			—			—

		Net income	$	4.73		$	2.24		$	2.05		$	1.72		$	1.53

		Weighted average number of common shares outstanding		93,145			90,002			71,424			66,235			60,776
	Diluted earnings per share:
		Income before discontinued operations, extraordinary items and cumulative effect of a change in accounting principle	$	4.40		$	2.23		$	1.97		$	1.68		$	1.58
		Discontinued operations, net of minority interest		0.28			0.03			0.04			0.03			0.03
		Extraordinary gain (loss), net of minority interest		(0.02	)		—			—			—			(0.09	)
		Cumulative effect of a change in accounting principle, net of minority interest		—			(0.07	)		—			—			—

		Net income	$	4.66		$	2.19		$	2.01		$	1.71		$	1.52

		Weighted average number of common and common equivalent shares outstanding		94,612			92,200			72,741			66,776			61,308

		December 31,
		2002		2001		2000		1999		1998
		(in thousands, except per share data)
Balance Sheet Information:
	Real estate, gross	$	8,670,711	$	7,457,906	$	6,112,779	$	5,609,424	$	4,917,193
	Real estate, net		7,847,778		6,738,052		5,526,060		5,138,833		4,559,809
	Cash		55,275		98,067		280,957		12,035		12,166
	Total assets		8,427,203		7,253,510		6,226,470		5,434,772		5,235,087
	Total indebtedness		5,147,220		4,314,942		3,414,891		3,321,584		3,088,724
	Minority interests		844,581		844,740		877,715		781,962		—
	Convertible Redeemable Preferred Stock		—		100,000		100,000		100,000		—
	Stockholders' and owners' equity(deficit)		2,159,590		1,754,073		1,647,727		1,057,564		948,481

		For the year ended December 31,
		2002			2001			2000			1999			1998
		(in thousands, except per share data)
Other Information:
	Funds from operations(1)	$	495,610		$	411,246		$	247,371		$	196,101		$	153,045
	Funds from operations, as adjusted(1)		516,004			337,823			247,371			196,101			153,045
	Dividends per share		2.41			2.27			2.04			1.75			1.64
	Cash flow provided by operating activities		437,380			419,403			339,664			303,469			215,287
	Cash flow used in investing activities		(1,017,283	)		(1,303,622	)		(573,363	)		(654,996	)		(2,179,215	)
	Cash flow provided by (used in) financing activities		537,111			701,329			502,621			351,396			1,958,534
	Total square feet at end of year		42,411			40,718			37,926			35,621			31,077
	Occupancy rate at end of year		93.9	%		95.3	%		98.9	%		98.4	%		97.1	%

(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"), we calculate 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 of properties, real estate related depreciation and amortization, and after adjustment for unconsolidated partnerships and joint ventures. In addition to FFO (as defined by NAREIT), we also disclose FFO after specific supplemental adjustments. Although our FFO as adjusted clearly differs from NAREIT's definition of FFO as well that of other real estate companies, we believe it provides a meaningful presentation of our operating performance. In addition, we believe that to further understand our performance, FFO and FFO as adjusted should be compared with our reported net income and cash flows in accordance with GAAP, as presented in our consolidated financial statements.

Our computation of FFO may not be comparable to FFO reported by other REITs 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, we make 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 our 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 indicator of our ability to make cash distributions.

A reconciliation for Funds from Operations to net income computed in accordance with GAAP is provided under the heading of Management's Discussion and Analysis of Financial Condition and Results of Operations, Funds from Operations.

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with the financial statements and notes thereto appearing elsewhere in this report.

Forward Looking Statements

This Report on Form 10-K contains forward-looking statements within the meaning of the federal securities laws, principally, but not only, under the captions "Business and Growth Strategies," "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations." We caution investors that any forward-looking statements in this report, or which management may make orally or in writing from time to time, are based on management's beliefs and on assumptions made by, and information currently available to, management. When used, the words "anticipate," "believe," expect," "intend," "may," "might," "plan," "estimate," "project," "should," "will," "result" and similar expressions which do not relate solely to historical matters are intended to identify forward-looking statements. Such statements are subject to risks, uncertainties and assumptions and are not guarantees of future performance, which may be affected by known and unknown risks, trends, uncertainties and factors that are beyond our control. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or projected. We caution you that, while forward-looking statements reflect our good faith beliefs when we make them, they are not guarantees of future performance and are impacted by actual events when they occur after we make such statements. We expressly disclaim any responsibility to update our forward-looking statements, whether as a result of new information, future events or otherwise. Accordingly, investors should use caution in relying on past forward-looking statements, which are based on results and trends at the time they are made, to anticipate future results or trends.

Some of the risks and uncertainties that may cause our actual results, performance or achievements to differ materially from those expressed or implied by forward-looking statements include, among others, the following:

•: general risks affecting the real estate industry (including, without limitation, the inability to enter into or renew leases, dependence on tenants' financial condition, and competition from other developers, owners and operators of real estate);
•: risks associated with the availability and terms of financing and the use of debt to fund acquisitions and developments; failure to manage effectively our growth and expansion into new markets or to integrate acquisitions successfully;
•: risks and uncertainties affecting property development and construction (including, without limitation, construction delays, cost overruns, inability to obtain necessary permits and public opposition to such activities);
•: risks associated with downturns in the national and local economies, increases in interest rates, and volatility in the securities markets; costs of compliance with the Americans with Disabilities Act and other similar laws;
•: potential liability for uninsured losses and environmental contamination;
•: risks associated with our potential failure to qualify as a REIT under the Internal Revenue Code of 1986, as amended, and possible adverse changes in tax and environmental laws; and
•: risks associated with our dependence on key personnel whose continued service is not guaranteed.

The risks included here are not exhaustive. Other sections of this report may include additional factors which could adversely affect our business and financial performance. Moreover, we operate in a very competitive and rapidly changing environment. New risk factors emerge from time to time and it is not possible for management to predict all such risk factors, nor can we assess the impact of all such risk factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results. Investors should also refer to our quarterly reports on Form 10-Q for

future periods and current reports on Form 8-K as we file them with the SEC, and to other materials we may furnish to the public from time to time through Forms 8-K or otherwise.

Critical Accounting Policies

The SEC published cautionary advice in December 2001 regarding MD&A disclosure of critical accounting policies. The significant accounting policies are also discussed in Note 1 of our financial statements. These critical accounting policies are subject to judgments and uncertainties, which affect the application of these policies. We base our estimates on historical experience and on various other assumptions believed to be reasonable under the circumstances. On an on-going basis, we evaluate our estimates. In the event estimates or assumptions prove to be different from actual results, adjustments are made in subsequent periods to reflect more current information. The material accounting policies that we believe are most critical to the understanding of our financial position and results of operations that require significant management estimates and judgments are discussed below.

Real Estate

Real estate is stated at depreciated cost. The cost of buildings and improvements include the purchase price of property, legal fees and acquisition costs. Costs directly related to the development of properties are capitalized. Capitalized development costs include interest, internal wages, property taxes, insurance, and other project costs incurred during the period of development.

We periodically review our properties to determine if our carrying amounts will be recovered from future operating cash flows. The evaluation of anticipated cash flows is highly subjective and is based in part on assumptions regarding future occupancy, rental rates and capital requirements which could differ materially from actual results in future periods. Since cash flows on properties considered to be "long-lived assets to be held and used" as defined by FAS 144 are considered on an undiscounted basis to determine whether an asset has been impaired, our established strategy of holding properties over the long term directly decreases the likelihood of recording an impairment loss. If our strategy changes or market conditions otherwise dictate an earlier sale or disposal date, an impairment loss may be recognized. If we determine that impairment has occurred, the affected assets must be reduced to their fair value. No such impairment losses have been recognized to date.

A variety of costs are incurred in the acquisition, development and leasing of our properties. After determination is made to capitalize a cost, it is allocated to the specific component of a project that is benefited. Determination of when a development project is substantially complete and capitalization must cease involves a degree of judgement. Our capitalization policy on our development properties is guided by SFAS No. 34 "Capitalization of Interest Cost" and SFAS No. 67 "Accounting for Costs and the Initial Rental Operations of Real Estate Properties", and ceases capitalization when the property is held available for occupancy upon substantial completion of tenant improvements, but no later than one year from the completion of major construction activity. In the third quarter of 2002, we substantially completed construction of the base building at 611 Gateway in South San Francisco. Although substantial construction remained which would allow continued capitalization until the earlier of completion of tenant build-out or one-year, and since we have no leasing prospects and do not expect to lease the property within the next year, the building was placed in-service during the third quarter of 2002. Accordingly, since July 2002 all costs are being expensed as incurred.

Investments in Unconsolidated Joint Ventures

We account for our investments in unconsolidated joint ventures under the equity method of accounting as we exercise significant influence, but do not control these entities. These investments are recorded initially at cost, as Investments in Unconsolidated Joint Ventures, and subsequently adjusted for equity in earnings and cash contributions and distributions. Any difference between the carrying amount of these investments on our balance sheet and the underlying equity in net assets is amortized as an adjustment to equity in earnings of unconsolidated joint ventures over 40 years. Under the equity

method of accounting, the net equity investment is reflected on our consolidated balance sheets, and our share of net income or loss from the joint ventures is included on our consolidated statements of operations. The joint venture agreements may designate different percentage allocations among the investors for profits and losses, however our recognition of joint venture income or loss generally follows the joint ventures' distribution priorities, which may change upon the achievement of certain investment return thresholds.

We serve as the development manager for the joint ventures currently under development. The profit on development fees received from joint ventures is recognized to the extent attributable to the outside interests in the joint ventures, in addition to internal costs.

Revenue Recognition

Base rental revenue is reported on a straight-line basis over the terms of our respective leases. Accrued rental income represents rental income earned in excess of rent payments received pursuant to the terms of the individual lease agreements. We maintain an allowance against accrued rental income for future potential tenant credit losses. The credit assessment is based on the estimated accrued rental income that is recoverable over the term of the lease. We also maintain an allowance for doubtful accounts for estimated losses resulting from the inability of tenants to make required rent payments. The computation of this allowance is based on the tenants' payment history and current credit status, as well as certain industry or geographic specific credit considerations. If our estimates of collectibility differ from the cash received, the timing and amount of our reported revenue could be impacted. The average remaining term of our in-place tenant leases was approximately 7.2 years as of December 31, 2002. The credit risk is mitigated by the high quality of our tenant base, review of the tenant's risk profile prior to lease execution and continual monitoring of our portfolio to identify potential problem tenants.

Property operating cost reimbursements due from tenants for common area maintenance, real estate taxes and other recoverable costs are recognized in the period that expenses are incurred.

Development fees are recognized ratably over the period of development, as earned. Management fees are recognized as revenue as they are earned.

Gains on sales of real estate are recognized pursuant to the provisions of SFAS No. 66 "Accounting for Sales of Real Estate." The specific timing of the sale is measured against various criteria in SFAS No. 66 related to the terms of the transactions and any continuing involvement in the form of management or financial assistance associated with the properties. If the sales criteria are not met, we defer gain recognition and account for the continued operations of the property by applying the finance, installment or cost recovery methods, as appropriate until the sales criteria are met.

Depreciation

We compute depreciation on our properties using the straight line method based on an estimated useful life of 40 years. The portion of the acquisition cost allocated between land and building each property may vary based on estimated land value and other factors. The allocation of the acquisition cost to building and the determination of the useful life are based on management's estimates of the composite life of the building.

Fair Value of Financial Instruments

On a quarterly basis, we calculated the fair value of our mortgage debt and unsecured notes. We discount the spread between the future contractual interest payments and future interest payments on our mortgage debt and unsecured notes based on a current market rate. In determining the current market rate, we add a market spread to the quoted yields on federal government treasury securities with similar maturity dates to our own debt. In addition, we are also required to adjust the carrying values of our derivative contracts on a quarterly basis to its fair value. Because our valuations of our financial instruments are based on these types of estimates, the fair value of our financial instruments may change if our estimates do not turn out to be accurate.

Overview

Notwithstanding a decrease in tenant demand and higher reported vacancy rates, which have been impacted by stagnant job growth and the substantial supply of sub-lease space brought back to market due to overzealous expectations of economic growth which did not materialize, we produced a solid operating performance in 2002, increasing diluted earnings per share, excluding gains on sales of properties, by 13.8% on year-to year basis. Highlights of the 2002 operating performance include:

•: completion of major new development projects at 5 Times Square Tower and 111 Huntington Avenue;
•: acquisition of 399 Park Avenue in midtown Manhattan;
•: opportunistic sale of premier assets in Washington, D.C.; and
•: enhancement of capital structure thorough the placement of $750 million investment grade ten year 6.25% notes due 2013.

During 2002, we added 4.5 million net rentable square feet to our portfolio by completing an acquisition totaling approximately $1.06 billion and completing developments totaling approximately $924.0 million. In addition, as of December 31, 2002, we had construction in progress representing a total anticipated investment of approximately $924.0 million and a total of approximately 2.8 million net rentable square feet.

Also in 2002, we sold seven properties and other real estate totaling 1.5 million net rentable square feet. We received gross proceeds from the sale of this real estate of approximately $428.0 million. On the 2.7 million net rentable square feet of second generation space renewed or re-leased during the year, new net rents were on average approximately 6.8% higher than the expiring net rents. At December 31, 2002, our in-service portfolio was 93.9% occupied.

The difficulties and uncertainties characterizing the economy since 2001 still prevail and there is no sign yet of the job growth necessary for increasing office space demand. It is worth noting that, in this real estate cycle, previous over-commitments to space by tenants, particularly among technology companies, had an unprecedented role in subsequently rising vacancy rates while excessive speculative construction played a much lesser role, and that the market responded quickly to declining demand with a halt in almost all new construction. While this bodes well for the future, we do not foresee a significant improvement in the market in 2003. Decreased tenant activity makes it unlikely that occupancy rates will increase this year, and since there will be no shortage of opportunities for tenants, increases in market rents are unlikely, with further declines possible. As a consequence we expect little or no growth in 2003 in the income generated within our portfolio.

One of our focuses for 2003 is completing the leasing of three development projects recently put into service or still under construction. Two suburban projects with 555,000 net rentable square feet in total and base building construction completed, Waltham Weston Corporate Center in Waltham, Massachusetts, and 611 Gateway Center in south San Francisco, California, are impacted by low market demand and will not achieve stabilization for several years. The third project is Times Square Tower, a 47 story, 1.2 million net rentable square foot building currently under construction in New York City at the heart of Times Square. Arthur Andersen had originally been secured as lead tenant for this property, which is now being actively re-marketed after the termination of the Andersen lease in the wake of that firm's demise last year. A 207,000 square foot lease with a major law firm was signed in January 2003, and we are very encouraged by the considerable additional active tenant interest in this property, but with initial occupancy not scheduled until 2004, Times Square Tower will of course not contribute to 2003 earnings.

Our successful issuance of unsecured long- term debt, while beneficial overall in obtaining long-term fixed-rate investment grade debt, will negatively affect earnings for 2003 compared to last year. This fixed rate debt replaced floating rate construction financing in place during 2002 to fund development projects and part of the floating rate bridge financing that initially funded the acquisition

of 399 Park Avenue. Thus our debt in 2003, by the nature of the yield curve, will be at measurably higher interest rates. This matching of long-term fixed rate financing to the long-term duration of our leases represents an appropriately prudent financial structure, but the impact will be some reduction in comparable net income.

Results of Operations

The following discussion is based on our Consolidated Financial Statements for the years ended December 31, 2002, 2001 and 2000.

As of July 1, 2002, we reported the gross operating revenues and expenses associated with our ownership of the hotels by our TRS on a consolidated basis, whereas in the past, we only reported net lease payments and real estate taxes. The reporting of the hotel operations for the year ended December 31, 2002 is not directly comparable to the same period in 2001 and therefore the hotel operating expenses have been netted against hotel revenues for the year ended December 31, 2002 (otherwise entitled "Hotel Net Operating Income") to provide a basis of comparison to prior periods.

As of December 31, 2002 and 2001, we owned 142 properties and 147 properties, respectively (we refer to all of the properties that we own as our "Total Portfolio"). Our property operations, including property management, development and leasing are regionally aligned with the objective of becoming the dominant landlord in our core markets. Management reviews operating and financial data for each property separately and independently from all other properties. Major decisions regarding the allocation of financing, investing, information technology and capital allocation are made in conjunction with the input of senior management located in our corporate headquarters.

As a result of changes in 2002 within our Total Portfolio, the financial data presented below shows significant changes in revenues and expenses from period to period. We do not believe our period to period financial data are comparable. Therefore, the comparison of operating results for the years ended December 31, 2002, 2001 and 2000 show changes resulting from properties that we owned for each period compared (we refer to this comparison as our "Same Property Portfolio" for the applicable period) and the changes attributable to our Total Portfolio.

Comparison of the year ended December 31, 2002 to the year ended December 31, 2001

The table below shows selected operating information for the Same Property Portfolio and the Total Portfolio. The Same Property Portfolio consists of 119 properties, including three hotels and five properties in which we have a joint venture interest, acquired or placed in service on or prior to January 1, 2001 and owned by us through December 31, 2002. The Total Property Portfolio includes the effect of the other properties either placed in service or acquired after January 1, 2001 or disposed of on or prior to December 31, 2002. Our net property operating margins, which are defined as rental

revenues less operating expenses exclusive of the three hotel properties for the year ended December 31, 2002, have ranged between 67% and 70%.

			Same Property Portfolio									Total Portfolio
			2002		2001		Increase/ (Decrease)			% Change		2002			2001			Increase/ (Decrease)			% Change
			(dollars in thousands)
Revenue:
	Rental		$	868,371	$	855,155	$	13,216		1.55	%	$	1,166,465		$	1,000,530		$	165,935		16.58	%
	Termination income			7,297		20,215		(12,918	)	(63.90	)%		7,320			21,640			(14,320	)	(66.17	)%
	Development and management services			—		—		—		—			10,748			12,167			(1,419	)	(11.66	)%
	Interest and other			—		—		—		—			5,504			12,183			(6,679	)	(54.82	)%

		Total revenue		875,668		875,370		298		0.03	%		1,190,037			1,046,520			143,517		13.71	%

Operating expenses				300,527		290,624		9,903		3.41	%		395,075			357,069			38,006		10.64	%

Net Operating Income				575,141		584,746		(9,605	)	(1.64	)%		794,962			689,451			105,511		15.30	%

Hotel Net Operating Income				23,284		26,768		(3,484	)	(13.02	)%		23,284			26,768			(3,484	)	(13.01	)%
Expenses:
	General and administrative			—		—		—		—			47,292			38,312			8,980		23.44	%
	Interest			—		—		—		—			271,685			223,389			48,296		21.62	%
	Depreciation and amortization			135,445		131,476		3,969		3.02	%		186,177			149,181			36,996		24.80	%
	Net derivative losses			—		—		—		—			11,874			26,488			(14,614	)	(55.17	)%
	Loss on investments in other companies			—		—		—		—			4,297			6,500			(2,203	)	(33.89	)%

		Total expenses		135,445		131,476		3,969		3.02	%		521,325			443,870			77,455		17.45	%

Income before minority interests			$	462,980	$	480,038	$	(17,058	)	(3.55	)%	$	296,921		$	272,349		$	24,572		9.02	%

Income from unconsolidated joint ventures			$	5,225	$	4,014	$	1,211		30.17	%	$	7,954		$	4,186		$	3,768		90.01	%

Gains on sales of real estate, net			$	—	$	—	$	—		—		$	186,810		$	6,505		$	180,305		2771.79	%

Income from discontinued operations, net			$	—	$	—	$	—		—		$	1,135		$	2,829		$	(1,694	)	(59.88	)%

Gains on sales of real estate from discontinued operations, net			$	—	$	—	$	—		—		$	25,345		$	—		$	25,345		—

Extraodinary items, net			$	—	$	—	$	—		—		$	(1,956	)	$	—		$	(1,956	)	—

Preferred dividend			$	—	$	—	$	—		—		$	(3,412	)	$	(6,592	)	$	(3,180	)	(48.24	)%

Rental Revenue

The increase in rental revenue of $165.9 million in the Total Portfolio, which includes an increase in straight line rent of approximately $23.0 million, primarily relates to new leases signed and in place at December 31, 2002 in connection with the acquisition of Citigroup Center in the second quarter of 2001 and the acquisition of 399 Park Avenue in the third quarter of 2002, the commencement of occupancy at 111 Huntington Avenue in the fourth quarter of 2001 and the placing into service of Five Times Square in the first quarter of 2002. These increased revenue by $194.5 million. This increase was offset by dispositions of properties throughout 2002 and a decrease in occupancy rates from 95.3% at December 31, 2001 to 93.9% at December 31, 2002. Properties sold during 2002 included One and Two Independence Square, 2391 West Winton Avenue, Fullerton Square, and 7600, 7700 and 7702 Boston Boulevard.

Termination Income

The termination income for the year ended December 31, 2002 was primarily related to three tenants in San Francisco who terminated their leases and made termination payments totaling approximately $4.0 million. This compared to termination income received in the prior year related to the early surrender of space of one tenant in New York representing $12.4 million.

Development and Management Services

The decrease in development and management income of $1.4 million primarily resulted from the completion of projects during 2001, including certain third party contracts as well as certain of our joint venture projects. This decrease was offset by development fees earned on a new joint venture project which was started in 2002 as well as an increase in management fees relating to certain of our joint ventures which were placed into service in 2002.

Interest and Other

The decrease in interest and other expenses related to the Total Portfolio is a result of less interest earned due to lower average cash balances maintained and lower interest rates on cash balances during the year ended December 31, 2002 as compared to the year ended December 31, 2001. During the year ended December 31, 2001, the higher average cash balance was attributable to unused proceeds from our public offering of common stock in October 2000.

Operating Expenses

Property operating expenses (real estate taxes, utilities, insurance, repairs and maintenance, cleaning and other property-related expenses) in the Same Property Portfolio increased during the year ended December 31, 2002 primarily due to increases in real estate taxes of $5.2 million, or 5.0%, and increases in insurance of $4.1 million, or 70.6%. The increase in real estate taxes was primarily due to higher property tax assessments. Small increases in the other property operating expenses account for the remaining difference. Additional increases in property operating expenses in the Total Property Portfolio were primarily due to the additions of the Citigroup Center, Five Times Square, 399 Park Avenue and 111 Huntington Avenue properties and other properties that we acquired or placed in service after January 1, 2001. Increases in insurance in the Same Property Portfolio and Total Portfolio are related to increases in rates on existing coverage and the purchase of a separate stand-alone terrorism policy. The office leases include reimbursements from tenants for a portion of these operating expenses. The increases were offset by decreases related to properties that were sold during 2002.

Hotel Net Operating Income

Net operating income for the hotel properties decreased by $3.5 million or approximately 13.0% for the year ended December 31, 2002 compared to the year ended December 31, 2001. Average occupancy and Revenue per Available Room ("REVPAR") for the hotel properties were 80.7% and $146.25, respectively for the year ended December 31, 2002 compared to 80.5% and $158.50, respectively for the prior year. This is related to the general downturn in the economy as well as lasting effects of September 11, 2001.

Other Expenses

General and administrative expenses in the Total Portfolio increased during the year ended December 31, 2002 by $9.0 million, of which $2.8 million related to the write-off in the second quarter of non-recoverable commissions related to the termination of the lease with Arthur Andersen LLP for 620,947 square feet at the Times Square Tower development project. The remaining increase related

primarily to increases in compensation and related expenses, specifically an increase of $3.3 million to bonuses awarded to senior management for the year ended December 31, 2002 as compared to the year ended December 31, 2001, a $1.4 million increase related to a decrease in capitalized wages resulting from decreased development activity in 2002 compared to the year ended December 31, 2001, and a $0.5 million increase in costs incurred related to implementing the requirements of the Sarbanes-Oxley Act of 2002.

In 2003, we transitioned to using solely restricted stock units, as opposed to stock options and restricted stock, awarded under the 1997 Stock Incentive Plan, as amended and restated on January 24, 2000, as our primary vehicle for employee equity compensation. Employees vest in restricted stock unit awards over a five year term. Restricted stock and restricted stock units are measured at fair value on the date of grant based on the number of shares granted and the price of our common stock on the date of grant as quoted on the New York Stock Exchange. Such value is recognized as an expense ratably over the corresponding employee service period. To the extent restricted stock or restricted stock units are forfeited prior to vesting, the corresponding previously recognized expense is reversed as an offset to "Stock-based compensation." Stock-based compensation associated with restricted stock units was $1.2 million during the year ended December 31, 2002. Stock-based compensation associated with approximately $6.1 million of restricted stock units which were granted in January 2003 will be incurred as such restricted stock units vest in years 2006 through 2008.

Interest expense for the Total Portfolio increased as a result of having a higher average outstanding debt balance as compared to the prior period as well as decreased interest capitalization. This was primarily due to placing into service and cessation of interest capitalization on Five Times Square, 111 Huntington Avenue, and 611 Gateway and new debt incurred related to the acquisition of Citigroup Center and 399 Park Avenue. Our total debt outstanding at December 31, 2002 was approximately $5.1 billion, compared to $4.3 billion at December 31, 2001. This was partially offset by a decrease in our weighted average interest rates over the year from 6.57% at December 31, 2001 to 6.03% at December 31, 2002.

Costs directly related to the development of rental properties are capitalized. Capitalized development costs include interest, wages, property taxes, insurance and other project costs incurred during the period of development. Capitalized wages for the year ended December 31, 2002 and 2001 were $5.1 million and $6.6 million, respectively. These costs are not included in the general and administrative expenses discussed above. Interest capitalized for the year ended December 31, 2002 and 2001 was $22.5 million and $59.3 million, respectively. These costs are not included in the interest expense referenced above.

Depreciation and amortization expense for the Total Portfolio increased as a result of the additions of the Citigroup Center, Five Times Square, 111 Huntington Avenue and 399 Park Avenue properties and other properties that we acquired or placed in service after January 1, 2001. The increases were offset by decreases related to properties that were sold during 2002.

Net derivative losses for the Total Portfolio represent the mark to market of our derivative contracts and payments that were not effective for accounting purposes. During the year ended December 31, 2002, we recognized a reduction in the fair value of our contracts as a result of generally low interest rates. The fair value of our derivative contracts is included on our balance sheet at December 31, 2002.

During the year ended December 31, 2002, we recognized losses on our investments in securities of approximately $4.3 million. This loss was related to the write off of our investment in the securities of a technology company due to the Company's determination that the decline in the fair value of these securities was an other than temporary decline. The loss on investment of $6.5 million for the year ended December 31, 2001 was related to the write off of investments in securities of two technology companies.

Joint Ventures

Income from unconsolidated joint ventures for the Same Property Portfolio increased by $1.2 million for the year ended December 31, 2002. The primary result of the increase is related to the completion of the repositioning of 265 Franklin Street during 2001 as well as receiving preferential returns on certain other joint ventures resulting from the achievement of specified investment return thresholds. The additional increase in the total portfolio is related to the placing in service of One and Two Discovery Square.

Other

Gains on sales of real estate for the year ended December 31, 2002 related to the sale of One and Two Independence Square were not included in discontinued operations, as we have continuing involvement through a third party management agreement.

The decrease in income from discontinued operations for the year ended December 31, 2002 was a result of the properties classified as discontinued operations in accordance with SFAS 144 being sold prior to December 31, 2002, and therefore, we did not recognize a full year of revenues and expenses as we did in the prior year.

Gains on sales of real estate from discontinued operations for the year ended December 31, 2002 related to the gain recognized on the properties that were sold. These properties included Fullerton Square, 2391 West Winton and 7600, 7700 and 7702 Boston Boulevard.

The extraordinary item for the year ended December 31, 2002 related to a debt extinguishment charge we incurred in connection with the prepayment of debt in connection with the sale of our properties.

The decrease in our preferred dividend from $6.6 million for the year ended December 31, 2001 to $3.4 million for the year ended December 31, 2002 was a result of the conversion of 2,000,000 shares of our preferred stock into common stock in July 2002.

Comparison of the year ended December 31, 2001 to the year ended December 31, 2000

The table below shows selected operating information for the Same Property Portfolio and the Total Portfolio. The Same Property Portfolio consists of 115 properties, including three hotels and one property which we own a joint venture interest, acquired or placed in service on or prior to January 1, 2001 and owned by us through December 31, 2002. The Total Property Portfolio includes the effect of the other properties either placed in service or acquired after January 1, 2001 or disposed of on or prior to December 31, 2002. Our net property operating margins, which are defined as rental revenues

less operating expenses exclusive of the three hotel properties for the year ended December 31, 2002, have ranged between 67% and 70%.

												Total Portfolio
			Same Property Portfolio
			2001		2000		Increase/ (Decrease)			% Change		2001		2000		Increase/ (Decrease)			% Change
			(dollars in thousands)
Revenue:
	Rental		$	872,746	$	833,968	$	38,778		4.65	%	$	1,000,530	$	865,584	$	134,946		15.59	%
	Terminationincome			19,720		3,652		16,068		439.98	%		21,640		3,652		17,988		492.55	%
	Development and management services			—		—		—		—			12,167		11,837		330		2.79	%
	Interest and other			—		—		—		—			12,183		8,558		3,625		42.36	%

		Total revenue		892,466		837,620		54,846		6.55	%		1,046,520		889,631		156,889		17.64	%

Operating expenses				299,272		271,423		27,849		10.26	%		357,069		308,886		48,183		15.60	%

Net Operating Income				593,194		566,197		26,997		4.77	%		689,451		580,745		108,706		18.72	%

Hotel Net Operating Income				26,768		29,215		(2,447	)	(8.38	)%		26,768		29,215		(2,447	)	(8.38	)%
Expenses:
	General and administrative			—		—		—		—			38,312		35,659		2,653		7.44	%
	Interest			—		—		—		—			223,389		217,064		6,325		2.91	%
	Depreciation and amortization			130,998		127,679		3,319		2.60	%		149,181		132,223		16,958		12.83	%
	Net derivative losses			—		—		—		—			26,488		—		26,488		—
	Loss on investments in securities			—		—		—		—			6,500		—		6,500		—

		Total expenses		130,998		127,679		3,319		2.60	%		443,870		384,946		58,924		15.31	%

Income before minority interests			$	488,964	$	467,733	$	21,231		4.54	%	$	272,349	$	225,014	$	47,335		21.04	%

Income from unconsolidated joint ventures			$	441	$	573	$	(132	)	(23.04	)%	$	4,186	$	1,758	$	2,428		138.11	%

Revenue

The increase in rental revenue in our Same Property Portfolio is primarily a result of an overall increase in rental rates on new leases and rollovers, an increase in reimbursable operating expenses as well as an increase in termination fees and early surrender income offset by a decrease in occupancy from year to year. Rental revenue is comprised of base rent, including termination fees, recoveries from tenants and parking and other. Base rental revenue is recognized on a straight-line basis over the terms of the respective leases. Accrued rental income represents the amount by which straight-line rental revenue exceeds rents currently billed in accordance with the lease agreements. Straight line rent for the year ended December 31, 2001 was $28.0 million compared to $13.1 million for the year ended December 31, 2000. Termination fees and early surrender income increased from $3.7 million for the year ended December 31, 2000 to $21.6 million for the year ended December 31, 2001. Included in the $21.6 million is $12.4 million related to the early surrender of space of a tenant at 875 Third Avenue,

of which approximately $9.2 million has been received to date. We received the remaining amount on a monthly basis through July 2002. The occupancy for our Same Property Portfolio decreased from 98.9% as of December 31, 2000 to 95.8% as of December 31, 2001. Additional increases in rental revenues in our total portfolio are primarily the result of rental revenues earned on properties we acquired or placed in service after January 1, 2000 offset by a decrease in overall occupancy from 98.9% to 95.3%.

The increase in development and management services income in our total portfolio is mainly due to income earned on contracts starting in 2001 and 2000 and an increase of approximately $0.4 million of work order profits earned on the entire portfolio. This was offset by certain management and development contracts ending in 2000 and some reductions in charges for management fees.

The increase in interest and other income in our total portfolio is primarily due to more interest earned as a result of higher average cash balances in 2001 resulting from the remaining proceeds from the public offering in October 2000 offset by lower interest rates.

Operating Expenses

Property operating expenses (real estate taxes, utilities, repairs and maintenance, cleaning and other property-related expenses) in our Same Property Portfolio increased mainly due to increases in real estate taxes of $6.0 million, or 2.3%, and increases in utilities of $7.4 million, or 2.9%. Most office leases include reimbursement for these operating expenses. The increase in real estate taxes was primarily due to higher property tax assessments. Small increases in the other property operating expenses account for the remaining difference. Additional increases in property operating expenses in our total portfolio were due to properties we acquired or placed in service after January 1, 2000.

Hotel Net Operating Income

Net operating income for the hotel properties decreased $2.4 million, or approximately 8.4%, for the year ended December 31, 2001 as compared to December 31, 2000. Average occupancy and Revenue per Available Room ("REVPAR") for the hotel properties were 80.5% and $158.5, respectively, for the year ended December 31, 2001 compared to 88.4% and $195.59, respectively, for the prior year. This was a result of a general downturn in the market as well as the events of September 11, 2001.

Other Expenses

General and administrative expenses in our Total Portfolio increased mainly due to an overall increase in payroll due to an increase in the overall size of our Total Portfolio and the number of employees since January 1, 2000 as well as salary increases to employees. We wrote off $1.4 million of abandoned projects in 2001 compared to a $0.7 million write-off in 2000. In addition, the 2001 expense does not include $3.0 million that was included in the prior year related to the departure of two senior employees.

Interest expense for our Total Portfolio increased as a result of having a higher average outstanding debt balance as compared to the prior period. Our debt outstanding at December 31, 2001 was approximately $4.3 billion, compared to $3.4 billion at December 31, 2000. This was partially offset by a decrease in our weighted average interest rates over the year from 7.37% at December 31, 2000 to 6.57% at December 31, 2001.

Costs directly related to the development of rental properties are capitalized. Capitalized development costs include interest, wages, property taxes, insurance and other project costs incurred during the period of development. Capitalized wages for the years ended December 31, 2001 and 2000 were $6.5 million and $5.1 million, respectively. These costs are not included in the general and administrative expenses discussed above. Interest capitalized for the years ended December 31, 2001 and 2000 was $59.3 million and $37.7 million, respectively. These costs are not included in the interest expense discussed above.

Depreciation and amortization expense for our Same Property Portfolio increased as a result of capital and tenant improvements made during 2001. Additional increases in depreciation and amortization expense for our total portfolio were mainly due to the properties we acquired or placed in service after January 1, 2000 and related capital and tenant improvements.

The net derivative losses incurred during 2001 result from the adoption of Financial Accounting Standard No. 133 ("FAS 133") "Accounting for Derivative Instruments and Hedging Activities" as well as the mark to market of the derivatives subsequent to adoption.

The loss on investments in securities during 2001 resulted from the write down of investments in the securities of two publicly traded telecommunications companies. The Company determined that the decline in the fair value of these securities was other than temporary.

Joint Ventures

Unconsolidated joint venture income increased as a result of income earned on joint venture properties being placed in service during 2001 and income earned on joint venture properties acquired after January 1, 2000.

Liquidity and Capital Resources

The following summary discussion of our cash flows is based on the consolidated statements of cash flows in "Item 8. Financial Statements and Supplementary Data" and is not meant to be an all-inclusive discussion of the changes in our cash flows for the periods presented below.

Cash and cash equivalents were $55.3 million and $98.1 million at December 31, 2002 and December 31, 2001, respectively. The decrease was a result of the following increases and decreases in cash flows:

	Year Ended December 31,
	2002			2001			$ Change
	(in millions)
Cash Provided by Operating Activities	$	437,380		$	419,403		$	17,977
Cash Used for Investing Activities	$	(1,017,283	)	$	(1,303,622	)	$	286,339
Cash Provided by Financing Activities	$	537,111		$	701,329		$	(164,218	)

Our principal source of cash flow is the operation of our office properties and proceeds from secured and unsecured borrowings. The average term of a tenant lease is approximately 7.2 years with occupancy rates historically in the range of 94% to 98%. Our properties provide a relatively consistent stream of cash flow that provides us with resources to pay operating expenses, debt service and fund quarterly dividend and distribution payment requirements.

Cash used in investing activities for year ended December 31, 2002 is primarily comprised of the following acquisitions and additions to real estate:

	(in thousands)
Recurring capital expenditures	$	16,674
Planned non-recurring capital expenditures associated with acquisition properties		31,908
Hotel improvements, equipment upgrades and replacements		3,218
Acquisition of 399 Park Avenue		1,063,000
Development in process and tenant improvements		317,502

Acquisitions/additions to real estate	$	1,432,302

In addition, we had the following properties under construction at December 31, 2002:

Development Properties		Location	# of Buildings	Square feet	Investment to Date(1)		Anticipated Total Investment			Percentage Leased
	Shaws Supermarket	Boston, MA	1	57,235	$	21,723,021	$	24,034,000		100	%
	Waltham Weston Corporate Center	Waltham, MA	1	304,050		67,711,099		85,000,000		42	%
	New Dominion Tech, Building Two	Herndon, VA	1	257,400		9,434,333		67,589,000		100	%
	Two Freedom Square (50% ownership)	Reston, VA	1	422,930		39,181,217		49,336,000	(2)	65	%
	Times Square Tower	New York, NY	1	1,218,511		366,247,753		653,500,000		0	%
	901 New York Avenue (25% ownership)	Washington, D.C.	1	538,463		14,004,503		44,777,250	(2)	60	%

Total Development Properties			6	2,798,589	$	518,301,926	$	924,236,250		37	%

(1): Includes net revenues during lease-up period and cash component of derivative contracts.
(2): Represents our share of the investment.

In total, our existing construction loans on the above projects have $371.7 million remaining to be drawn out of a total of $702.5 million. Of our remaining commitment of $405.9 million to complete these developments, $368.7 million will be covered under our existing construction loans and $34.2 million from existing cash or draws from our unsecured line of credit.

Cash is used in investing activities to fund acquisitions, development and recurring and nonrecurring capital expenditures. The office of the Executive Vice President for Operations establishes the annual budget for capital improvement projects in consultation with regional management. All new projects require the Executive Vice President for Operations or his designee to approve the capital budget before commencement of work. We selectively invest in new projects which enable us to take advantage of our development skills and invest in existing buildings which meet our stringent investment criteria, with the objective of becoming a dominant landlord in our markets. In September 2002, we purchased 399 Park Avenue which we believe is one of New York City's premier properties. The ability to acquire a property of this caliber is a testament to our competitive advantage of meeting a seller's tight schedule for performing due diligence, negotiating agreements, financing and closing within a month's timeframe. In connection with this acquisition of and as a source of permanent financing for 399 Park Avenue, we executed on a disciplined strategy of re-deploying capital through the sale of some of our premier properties to harvest embedded value.

Cash provided by financing activities decreased $164.2 million for the year ended December 31, 2002. This was due to changes in our existing debt structure, including the paydown of certain construction loans and amounts outstanding on our unsecured revolving line of credit and our unsecured bridge loan. This was offset by the issuance by Boston Properties Limited Partnership of $750 million of unsecured senior notes. Future debt payments are discussed below under the heading "Capitalization."

We draw on multiple financing sources to fund our capital needs. Our line of credit is utilized primarily as a bridge facility to fund acquisition opportunities and meet short term development needs. We fund our new development with construction loans which may be partially guaranteed by Boston Properties Limited Partnership until project completion or lease-up thresholds are achieved. In December 2002, we completed a highly successful initial offering of unsecured investment grade senior notes and have made a commitment to utilize the bond market as a cost-effective financing source, in addition to asset backed mortgage financing and common and preferred equity.

Capitalization

At December 31, 2002, our total consolidated debt was approximately $5.1 billion. The weighted-average annual interest rate on our consolidated indebtedness was 6.03% and the weighted average maturity was approximately 5.4 years.

Our total market capitalization was approximately $9.8 billion at December 31, 2002. Total market capitalization was calculated using the December 31, 2002 closing stock price of $36.86 per share and includes the following: (1) 95,362,990 shares of our common stock, (2) 20,474,241 of common units of Boston Properties Limited Partnership (excluding common units held by Boston Properties, Inc.), (3) an aggregate of 9,201,137 common units issuable upon conversion of all Series One and Series Two preferred units outstanding, and (4) our consolidated debt. Our total consolidated debt at December 31, 2002 represented approximately 52.8% of our total market capitalization.

Debt Financing

The table below summarizes our mortgage notes payable, our senior unsecured notes, our unsecured bridge loan and our revolving line of credit with Fleet National Bank, as agent, at December 31, 2002 and 2001:

			December 31,
			2002			2001
			(dollars in thousands)
DEBT SUMMARY:
Balance
	Fixed rate		$	3,890,196		$	3,448,903
	Variable rate			1,257,024			866,039

		Total	$	5,147,220		$	4,314,942

Percent of total debt:
	Fixed rate			75.58	%		79.93	%
	Variable rate			24.42	%		20.07	%

		Total		100.00	%		100.00	%

Weighted average interest rate at end of period:
	Fixed rate			6.99	%		7.27	%
	Variable rate			3.04	%		3.77	%

		Total		6.03	%		6.57	%

The variable rate debt shown above bears interest based on various spreads over the London Interbank Offered Rate or Eurodollar rates.

Line of Credit

We utilize our $605.0 million unsecured revolving line of credit principally to fund development of properties, land and property acquisitions, and for working capital purposes. Our unsecured revolving line of credit is a recourse obligation of Boston Properties Limited Partnership. Based on terms of the extension discussed below, outstanding balances under the unsecured revolving line of credit bear interest at a floating rate based on an increase over the Eurodollar rate of 70 basis points (145 basis points at December 31, 2002) or the lender's prime rate, at our option. The interest rate is subject to adjustment in the event of a change in the Boston Properties Limited Partnership unsecured debt ratings.

Our ability to borrow under our unsecured revolving line of credit is subject to our compliance with a number of customary financial and other covenants on an ongoing basis, including: (1) an unsecured loan-to-value ratio against our total borrowing base not to exceed 60%, unless our leverage ratio exceeds 60%, in which case it is not to exceed 55%, (2) a secured debt leverage ratio not to exceed 55%, (3) a debt service coverage ratio of 1.40 for our borrowing base, (4) a fixed charge ratio of 1.30 and a debt service coverage ratio of 1.50, (5) a leverage ratio not to exceed 60%, however for five consecutive quarters (not including the two quarters prior to expiration) the leverage ratio can go to 65%, (6) limitations on additional indebtedness and stockholder distributions, and (7) a minimum net worth requirement. If we fail to comply with our financial and other covenants in our revolving line of credit, our lender could place us in default and accelerate the payment of any amounts then outstanding. As of December 31, 2002, we were in compliance with financial restrictions and requirements then applicable.

At December 31, 2002, we had letters of credit totaling $1.9 million outstanding under our unsecured line of credit and an outstanding draw of $146.9 million secured by our property at 875 Third Avenue, and had the ability to borrow an additional $429.2 million under our unsecured revolving line of credit which had a maturity date of March 31, 2003. In January 2003, we extended the maturity date to January 17, 2006 with an additional one-year extension option. The covenants discussed above are those required under our extension agreement. As of February 19, 2003, we had $572.1 million available under our unsecured revolving line of credit.

Unsecured Senior Notes

During the year ended December 31, 2002, we completed an unregistered offering of $750 million in aggregate principal amount of Boston Properties Limited Partnership's 6.25% senior unsecured notes due January 15, 2013. The notes were offered to qualified institutional buyers in the United States in reliance on Rule 144A under the Securities Act and to certain institutional investors outside of the United States in reliance on Regulation S under the Securities Act. The notes were priced at 99.65% of their principal amount to yield 6.296%. At December 31, 2002, there was $747.4 million aggregated principal amount of the notes outstanding (net of unamortized discount of $2.6 million).

On January 17, 2003, we completed an unregistered offering to qualified institutional investors in reliance on Rule 144A under the Securities Act of an additional $175 million aggregate principal amount of Boston Properties Limited Partnership's 6.25% senior unsecured notes due January 15, 2013. The notes were priced at 99.763% of their principal amount to yield 6.28%. The additional notes are fungible, and form a single series, with the senior notes issued in December 2002.

Our unsecured senior notes are redeemable at our option, in whole or in part, at a redemption price equal to the greater of (i) 100% of their principal amount or (ii) the sum of the present value of the remaining scheduled payments of principal and interest discounted at a rate equal to the yield on U.S. Treasury securities with a comparable maturity plus 35 basis points, in each case plus accrued and unpaid interest to the redemption date. The indenture under which our senior unsecured notes were issued contains restrictions on incurring debt and using our assets as security in other financing transactions and other customary financial and other covenants, including (1) a leverage ratio not to exceed 60%, (2) a secured debt leverage ratio not to exceed 50%, (3) an interest coverage ratio of 1.5, and (4) unencumbered asset value to be no less than 150% of our unsecured debt. As of December 31, 2002, we were in compliance with each of these financial restrictions and requirements.

Under a registration rights agreement with the initial purchasers of our senior unsecured notes, we agreed to use our reasonable best efforts to register with the SEC an offer to exchange new notes issued by us, which we refer to as "exchange notes," for the original notes. The exchange notes will be in the same aggregate principal amount as, and have terms substantially identical to the original notes, but will be freely tradable by the holders, while the original notes are subject to resale restrictions. The exchange offer will not generate any cash proceeds for us. If we are unable to file the exchange offer registration statement by March 10, 2003 or to complete the registered exchange offer by July 7, 2003, we will be obligated to pay additional interest on the notes until the exchange offer is completed or a so-called "shelf" registration statement covering the resale of the original notes by their holders is declared effective. We currently expect to meet these deadlines.

Unsecured Bridge Loan

On September 25, 2002, we obtained unsecured bridge financing totaling $1.0 billion in connection with the acquisition of 399 Park Avenue. During 2002, we repaid approximately $894.3 million with proceeds from the offering of unsecured senior notes and proceeds from the sales of certain real estate properties. At December 31, 2002, the unsecured bridge loan had an outstanding balance of approximately $105.7 million. During January 2003, we repaid all amounts outstanding under our unsecured bridge loan with proceeds from the January 2003 offering of senior unsecured notes.

Mortgage Debt

As of December 31, 2002, our total mortgage notes (excluding our share of unconsolidated joint venture debt described below) consisted of approximately $3.1 billion of fixed rate debt and $1.1 billion of variable rate debt with weighted average interest rates of 6.99% and 3.07% respectively.

The following table sets forth certain information regarding our mortgage notes and bonds payable at December 31, 2002:

Properties	Interest Rate		Principal Amount		Maturity Date
			(in thousands)
Citigroup Center	7.19	%	$	516,679	May 11, 2011
Embarcadero Center One, Two and Federal Reserve	6.70	%		304,734	December 10, 2008
5 Times Square(1)	2.92	%		372,905	January 26, 2003
Prudential Center	6.72	%		284,389	July 1, 2008
280 Park Avenue	7.64	%		265,194	February 1, 2011
599 Lexington Avenue(2)	7.00	%		225,000	July 19, 2005
Times Square Tower(3)	3.37	%		222,196	November 29, 2004
111 Huntington Avenue(4)	3.19	%		203,000	September 27, 2003
Embarcadero Center Four	6.79	%		148,774	February 1, 2008
875 Third Avenue(5)	2.89	%		146,902	March 31, 2003
Embarcadero Center Three	6.40	%		142,460	January 1, 2007
Riverfront Plaza	6.61	%		110,910	February 1, 2008
Democracy Center	7.05	%		104,298	April 1, 2009
Embarcadero Center West Tower	6.50	%		95,059	January 1, 2006
100 East Pratt Street	6.73	%		88,652	November 1, 2008
601 and 651 Gateway Boulevard	8.40	%		88,485	October 1, 2010
Reservoir Place(6)	6.88	%		69,265	November 1, 2006
One & Two Reston Overlook	7.45	%		66,726	August 31, 2004
2300 N Street	6.88	%		66,000	August 3, 2003
202, 206, 214 Carnegie Center	8.13	%		61,833	October 1, 2010
New Dominion Technology Park, Building 1	7.70	%		57,549	January 15, 2021
Capital Gallery	8.24	%		54,872	August 16, 2006
504,506,508 Carnegie Center	7.39	%		46,617	January 1, 2008
Waltham Weston Corporate Center(7)	3.14	%		44,840	February 13, 2004
10 and 20 Burlington Mall Road(8)	7.25	%		39,257	October 1, 2011
10 Cambridge Center	8.27	%		34,708	May 1, 2010
1301 New York Avenue(9)	7.15	%		30,540	August 15, 2009
2600 Tower Oaks Boulevard(10)	3.09	%		30,218	October 10, 2003
Sumner Square	7.35	%		29,736	September 1, 2013
Quorum Office Park(11)	3.07	%		28,818	August 25, 2003
Eight Cambridge Center	7.73	%		27,490	July 15, 2010
510 Carnegie Center	7.39	%		26,707	January 1, 2008

Lockheed Martin Building	6.61	%		25,240	June 1, 2008
University Place	6.94	%		24,117	August 1, 2021
Reston Corporate Center	6.56	%		23,806	May 1, 2008
Orbital Sciences—Building Two(12)	3.03	%		23,611	June 13, 2003
181, 191 and 201 Spring Street	8.50	%		22,074	September 1, 2006
Shaws Supermarket(13)	2.67	%		20,717	September 8, 2003
NIMA Building	6.51	%		20,626	June 1, 2008
Bedford Business Park	8.50	%		20,591	December 10, 2008
40 Shattuck Road(14)	3.17	%		15,939	October 21, 2003
101 Carnegie Center	7.66	%		7,751	April 1, 2006
302 Carnegie Center(15)	3.19	%		7,594	April 1, 2003
New Dominion Tech 2(16)	2.82	%		7,558	December 19, 2005
Montvale Center	8.59	%		7,284	December 1, 2006
Hilltop Business Center	6.81	%		5,398	March 1, 2019

Total			$	4,267,119

(1): Total construction loan in the amount of $420.0 million at a variable rate of Eurodollar + 1.50%. The maturity date can be extended for two one-year periods based on meeting certain conditions. Subsequent to December 31, 2002, we extended the maturity date until January 27, 2004.
(2): At maturity the lender has the option to purchase a 33.33% interest in this property in exchange for the cancellation of the principal balance of $225.0 million.
(3): Total construction loan in the amount of $493.5 million at a variable rate of Eurodollar + 1.95%. The maturity date can be extended for one six month period and two one-year periods based on meeting certain conditions.
(4): Total construction loan in the amount of $203.0 million at a variable rate of LIBOR + 1.75%. The maturity date can be extended for a one-year period based on meeting certain conditions. During February 2003, we repaid all amounts outstanding on this construction loan.
(5): During February 2003, we repaid all amounts outstanding on this loan.
(6): The principal amount and interest rate shown has been adjusted to reflect the fair value of the note. The stated principal balance at December 31, 2002 was $63.5 million and the interest rate was 9.65%.
(7): Total construction loan in the amount of $45.0 million at a variable rate of LIBOR + 1.70%. The maturity date can be extended for two one-year periods based on meeting certain conditions. During January 2003, we repaid all amounts outstanding on this construction loan.
(8): Includes outstanding indebtedness secured by 91 Hartwell Avenue.
(9): Includes outstanding principal in the amounts of $19.5 million, $7.3 million and $3.7 million which bear interest at fixed rates of 6.70%, 8.54% and 6.75%, respectively.
(10): Total construction loan in the amount of $32.0 million at a variable rate of LIBOR + 1.65%. The maturity date can be extended for one one-year periods based on meeting certain conditions.
(11): Total construction loan in the amount of $32.3 million at a variable rate of LIBOR + 1.65%. The maturity date can be extended for two one-year periods based on meeting certain conditions. During January 2003, we repaid all amounts outstanding on this construction loan.

(12): Total construction loan in the amount of $25.1 million at a variable rate of Eurodollar + 1.65%. The maturity date can be extended for a one-year period based on meeting certain conditions. During January 2003, we repaid all amounts outstanding on this construction loan.
(13): The maturity date can be extended for a one-year period and a six-month period based on meeting certain conditions.
(14): Total construction loan in the amount of $16.0 million at a variable rate of Eurodollar + 1.75%. The maturity date can be extended for two one-year periods based on meeting certain conditions. During January 2003, we repaid all amounts outstanding on this construction loan.
(15): Total construction loan in the amount of $10.0 million at a variable rate of LIBOR + 1.85%. The maturity date can be extended for two one-year periods based on meeting certain conditions. During January 2003, we repaid all amounts outstanding on this construction loan.
(16): The maturity date can be extended for a one-year period based on meeting certain conditions.

LIBOR and Eurodollar rate contracts in effect on December 31, 2002 ranged from LIBOR/Eurodollar + 1.25% to LIBOR/Eurodollar + 1.95%.

Our mortgage notes payable at December 31, 2002 will mature as follows:

Year
	(in thousands)
2003	$	931,496
2004		411,855
2005		285,387
2006		284,458
2007		182,632
Thereafter		2,171,291

Of the $931.5 million payable during 2003, we have repaid $425.8 during January and February of 2003 with proceeds from our offerings of unregistered senior notes as well as proceeds from sales of properties. In addition, we have extended the maturity date on the 5 Times Square construction loan which had $372.9 million outstanding at December 31, 2002 to December 31, 2004. Of the remaining $132.8 million due in 2003, we expect to fund the payments through cash flows from operations, proceeds from unsecured debt transactions and drawdowns from our revolving unsecured line of credit.

General

We have determined that our estimated cash flows and available sources of liquidity are adequate to meet liquidity needs for the next twelve months. We believe that our principal liquidity needs for the next twelve months are to fund normal recurring expenses, debt service requirements, current development costs not covered under construction loans and the minimum distribution required to maintain our REIT qualification under the Internal Revenue Code of 1986, as amended. We believe that these needs will be fully funded from cash flows provided by operating and financing activities.

We expect to meet liquidity requirements for periods beyond twelve months for the costs of development, property acquisitions, scheduled debt maturities, major renovations, ground lease payments, expansions and other non-recurring capital improvements through construction loans, the incurrence of long-term secured and unsecured indebtedness, income from operations and sales of real estate and possibly the issuance of additional common and preferred units and unsecured senior notes of Boston Properties Limited Partnership and equity securities of Boston Properties, Inc. In addition, we may finance the development, redevelopment or acquisition of additional properties by using our unsecured revolving line of credit.

Rental revenues, operating expense reimbursement income from tenants, and other income from operations are our principal sources of capital used to pay operating expenses, debt service and recurring capital expenditures. We seek to increase income from our existing properties by maintaining quality standards for our properties that promote high occupancy rates and permit increases in rental rates while reducing tenant turnover and controlling operating expenses. Our sources of revenue also include third party fees generated by our office and industrial real estate management, leasing, development and construction businesses. Consequently, we believe our revenue, together with proceeds from financing activities, will continue to provide the necessary funds for operating expenses, debt service and recurring capital expenditures. However, material changes in these factors may adversely affect our net cash flows. Such changes, in turn, would adversely affect our ability to find distributions, debt service, capital improvements and non-revenue enhancing tenant improvements. In addition, a material adverse change in our cash provided by operations may affect the financial performance covenants under our unsecured line of credit and unsecured senior notes.

Based on leases in place at December 31, 2002, leases with respect to 4.4% of our Class A office buildings will expire in calendar year 2003. Although we are unable to estimate the actual rate of future leases, we believe that the short term expiring leases may be renewed, or space re-let, at lower or the same rents than previously in effect. While we are working to retain our current tenants in situations that are beneficial to us, conditions over the past year, including more sublet space available and decreasing rental rates across the board, make it difficult for us to predict what future changes may be and how they will effect our re-leasing efforts.

During the year ended December 31, 2002, we paid or declared quarterly dividends totaling $2.41 per common share (consisting of $.58 per share related to the quarter ended March 31, 2002 and $.61 per share related to each of the quarters ended June 30, 2002, September 30, 2002 and December 31, 2002). We intend to continue paying dividends quarterly.

Market Risk

Market risk is the risk of loss from adverse changes in market prices and interest rates. Our future earnings, cash flows and fair values relevant to financial instruments are dependent upon prevalent market interest rates, including refinancing risk on our fixed rate debt. Our primary market risk results from our indebtedness, which bears interest at fixed and variable rates. The fair value of our long-term debt obligation is affected by changes in the market interest rates. We manage our market risk, in part, by attempting to match our long-term leases with long-term fixed rate debt of similar duration. We also utilize certain derivative financial instruments at times to further reduce interest rate risk. Although certain derivative instruments were not effective for accounting purposes, derivatives have been used to convert a portion of our variable rate debt to a fixed rate, or to hedge anticipated financing transactions. Derivatives are used solely for risk management purposes rather than speculation. Approximately 75% of our outstanding debt has fixed interest rates, which minimizes the interest rate risk until the maturity of such outstanding debt.

At December 31, 2002, we had derivative contracts totaling $150 million. The derivative agreements provide for a fixed interest rate of 6.35% when LIBOR is less than 5.80%, 6.70% when LIBOR is between 6.70% and 7.45%, and 7.50% when LIBOR is between 7.51% and 9.0% for terms remaining from one to three years per the individual agreement. We will consider entering into additional derivative agreements with respect to all or a portion of our debt. We may borrow additional money with variable rates in the future. Increases in interest rates could increase interest expense, which in turn could affect cash flow and our ability to service our debt. As a result of the derivative contracts, decreases in interest rates could increase interest expense as compared to the underlying variable rate debt and could result in us making substantial payments to unwind such agreements.

During the year ended December 31, 2002, in anticipation of issuing fixed rate debt instruments, we entered into treasury lock agreements to hedge against a potential increase in the ten-year treasury rate. Upon the issuance of the fixed rate debt, we paid approximately $3.5 million to terminate the instruments, which amount is being amortized into interest expense over the term of the unsecured senior notes.

At December 31, 2002, our variable rate debt outstanding was approximately $1.3 billion. At December 31, 2002, the average interest rate on variable rate debt was approximately 3.04%. Exclusive of our derivative contracts, if market interest rates on our variable rate debt were to increase by 100 basis points, total interest would have increased approximately $12.6 million for the year ended December 31, 2002.

At December 31, 2001, our variable rate debt outstanding was approximately $866.0 million. At December 31, 2001, the average interest rate on variable rate debt was approximately 3.77%. Exclusive of our derivative contracts, if market interest rates on our variable rate debt were to increase by 100 basis points, total interest would have increased approximately $8.7 million for the year ended December 31, 2001.

These amounts were determined solely by considering the impact of hypothetical interest rates on our financial instruments and not including the effects of our derivative contracts. Due to the uncertainty of specific actions we may undertake to minimize possible effects of market interest rate increases, this analysis assumes no changes in our financial structure.

Funds from Operations

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"), we calculate 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 of properties, real estate related depreciation and amortization, and after adjustment for unconsolidated partnerships and joint ventures. In addition to FFO (as defined by NAREIT), we also disclose FFO after specific supplemental adjustments. Although our FFO as adjusted clearly differs from NAREIT's definition of FFO as well that of other real estate companies, we believe it provides a meaningful presentation of our operating performance. In addition, we believe that to further understand our performance, FFO and FFO as adjusted should be compared with our reported net income and cash flows in accordance with GAAP, as presented in our consolidated financial statements.

Our computation of FFO may not be comparable to FFO reported by other REITs 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, we make 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 our 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 indicator of our ability to make cash distributions.

Our funds from operations for the respective periods is calculated as follows:

		Year ended December 31,
		2002			2001			2000			1999			1998
		(in thousands)
Income before minority interests and unconsolidated joint venture income		$	296,921		$	272,349		$	225,014		$	178,555		$	137,740
Add:
	Real estate depreciation and amortization		192,574			153,550			134,386			119,583			74,649
	Income from unconsolidated joint ventures		7,954			4,186			1,758			468			—
	Income from discontinued operations		1,384			3,483			3,765			3,817			2,835
Less:
	Minority property partnership's share of funds from operations		(3,223	)		(2,322	)		(1,061	)		(3,681	)		(4,185	)
	Preferred dividends and distributions		(28,711	)		(33,312	)		(32,994	)		(32,111	)		(5,830	)

Funds from operations			466,899			397,934			330,868			266,631			205,209

Add(subtract):
	Net derivative losses (SFAS No. 133)		11,874			26,488			—			—			—
	Early surrender lease adjustment		8,520			(8,518	)		—			—			—

Funds from operations before net derivative losses and after early surrender lease adjustment		$	487,293		$	415,904		$	330,868		$	266,631		$	205,209

Funds from operations available to common shareholders before net derivative losses and after early surrender lease adjustment		$	399,489		$	337,823		$	247,371		$	196,101		$	153,045

Weighted average shares outstanding—basic			93,145			90,002			71,424			66,235			60,776

Reconciliation to Diluted Funds from Operations:

		For the years ended December 31,
		2002			2001			2000			1999			1998
		Income (Numerator)		Shares/Units (Denominator)	Income (Numerator)		Shares/Units (Denominator)	Income (Numerator)		Shares/Units (Denominator)	Income (Numerator)		Shares/Units (Denominator)	Income (Numerator)		Shares/Units (Denominator)
		(in thousands)
Basic Funds from Operations before net derivative losses and after early surrender lease adjustment		$	487,293	113,617	$	415,904	110,803	$	330,868	95,532	$	266,631	90,058	$	205,209	81,487
Effect of Dilutive Securities
	Convertible Preferred Units		25,114	9,821		26,720	11,012		26,422	10,393		26,428	10,360		2,819	1,135
	Convertible Preferred Stock		3,412	1,366		6,592	2,625		6,572	2,625		5,834	2,337		—	—
	Stock Options and other		185	1,468		—	1,547		—	1,280		—	541		—	532

Diluted Funds from Operations before net derivative losses and after early surrender lease adjustment		$	516,004	126,272	$	449,216	125,987	$	363,862	109,830	$	298,893	103,296	$	208,028	83,154

Diluted Funds from Operations available to common shareholders before net derivative losses and after early surrender lease adjustment(1)		$	432,345	105,799	$	375,046	105,185	$	283,994	85,723	$	229,961	79,473	$	156,215	62,443

(1): Our share of diluted funds from operations was 83.79%, 83.49%, 78.05%, 76.94% and 75.09% for the years ended December 31, 2002, 2001, 2000, 1999 and 1998, respectively.

Off Balance Sheet Arrangements

Joint Ventures

We have investments in eight unconsolidated joint ventures with ownership interests ranging from 25 to 51%. We do not have control of these partnerships, and therefore, they are presently accounted for using the equity method of accounting. At December 31, 2002, our share of the debt related to these investments was equal to approximately $236.8 million. The table below summarizes the outstanding debt (based on our respective ownership interests) in these joint venture properties at December 31, 2002:

Properties	Interest Rate		Principal Amount		Maturity Date
			(in thousands)
Metropolitan Square (51%)	8.23	%		69,827	May 1, 2010
Market Square North (50%)	7.70	%		48,637	December 19, 2011
Discovery Square (50%)	3.02%	(1)		30,949	December 8, 2003
Two Freedom Square (50%)(2)	3.24%	(1)		32,853	June 29, 2004
One Freedom Square (25%)	7.75	%		18,940	June 30, 2012
265 Franklin Street (35%)	2.74%	(1)		18,897	October 1, 2003
140 Kendrick Street (25%)	7.51	%		14,061	July 1, 2013
901 New York Avenue (25%)(2)	3.09%	(1)		2,643	November 12, 2005

Total	6.17	%	$	236,807

(1): Variable rate debt.
(2): Under construction at December 31, 2002.

We will have $49.8 million of principal expiring during 2003. We expect to utilize our extension options under both construction loans.

In connection with the development of office properties, we and/or our equity affiliates have agreed to fund the remaining equity capital associated with approved development projects of joint ventures aggregating approximately $143.4 million (of which our share is $40.9 million). These obligations are expected to be financed through new or existing construction loans plus approximately $3.4 million of our equity investment.

Related Party Transactions

Printing Services

We paid Applied Printing Technologies, a printing company affiliated with Mr. Mortimer B. Zuckerman, approximately $80,000 for printing services provided in 2002, principally relating to the printing of the Company's annual report to shareholders. The selection of Applied Printing Technologies as the printer for our annual report to shareholders was made through a bidding process open to multiple printing companies.

Brokerage Activities

Mr. Turchin, a director of Boston Properties, is a non-executive/non-director Vice Chairman of Insignia. Through an arrangement with Insignia that has been in place since 1985, Turchin & Associates, an affiliate of Mr. Turchin, participates in brokerage activities for which Insignia is retained as leasing agent, some of which involve leases for space within buildings owned by us. During the period from the date Mr. Turchin became a member of the Board of Directors of the Company in 1997 through December 31, 2002, Turchin & Associates has advised us that it has received $2.3 million from

Insignia attributable to properties owned by us. Of this amount, $0.7 million (or approximately 30%) is in conjunction with funds we owed to Insignia related to the acquisition of 280 Park Avenue. The total amount that was paid to Turchin & Associates, excluding amounts paid related to obligations assumed in connection with the acquisition of 280 Park Avenue, represents approximately 4.83% of the total amount paid to Insignia by us since the date Mr. Turchin became a director of the Company in 1997. Pursuant to its arrangement with Insignia, Turchin & Associates has confirmed to the Company that it is paid on the same basis with respect to properties owned by us as it is with respect to properties owned by other clients of Insignia. Mr. Turchin does not participate in any discussions or other activities relating to our contractual arrangements with Insignia either in his capacity as a member of our Board of Directors or as a Vice Chairman of Insignia.

Leasing Commissions

A joint venture in which we have a 50% interest, paid aggregate leasing commissions in 2002 of approximately $571,000 to a firm controlled by Mr. Raymond A. Ritchey's brother. Mr. Ritchey is an Executive Vice President of the Company. The terms of the related agreement are at least as favorable to us as arrangements with other brokers in comparable markets.

Environmental Matters

It is our policy to retain independent environmental consultants to conduct or update Phase I environmental assessments (which generally do not involve invasive techniques such as soil or ground water sampling) and asbestos surveys with respect to our properties. These pre-purchase environmental assessments have not revealed environmental conditions that we believe will have a material adverse effect on our business, assets or results of operations, and we are not otherwise aware of environmental conditions with respect to our properties which we believe would have such a material adverse effect. However, from time to time pre-existing environmental conditions at our properties have required environmental testing and/or regulatory filings.

In February 1999, one of our affiliates acquired from Exxon Corporation a property in Massachusetts that was formerly used as a petroleum bulk storage and distribution facility and was known by the state regulatory authority to contain soil and groundwater contamination. We recently completed development of an office park on the property. Our affiliate engaged a specially licensed environmental consultant to oversee the management of contaminated soil and groundwater that was disturbed in the course of construction. Pursuant to the property acquisition agreement, Exxon agreed to (1) bear the liability arising from releases or discharges of oil and hazardous substances which occurred at the site prior to our ownership, (2) continue remediating such releases and discharges as necessary and appropriate to comply with applicable requirements, and (3) indemnify our affiliate for certain losses arising from preexisting site conditions. Any indemnity claim may be subject to various defenses.

Environmental investigations at two of our properties in Massachusetts have identified groundwater contamination migrating from off-site source properties. In both cases we engaged a specially licensed environmental consultant to perform the necessary investigations and assessments and to prepare submittals to the state regulatory authority, including Downgradient Property Status Opinions. The environmental consultant concluded that the properties qualify for Downgradient Property Status under the state regulatory program, which eliminates certain deadlines for conducting response actions at a site. We also believe that these properties qualify for liability relief under certain statutory amendments regarding upgradient releases. Although we believe that the current or former owners of the upgradient source properties may ultimately be responsible for some or all of the costs of addressing the identified groundwater contamination, we will take necessary further response actions (if any are required). No such additional response actions are anticipated at this time.

One of our affiliates recently acquired a property in Massachusetts where historic groundwater contamination was identified prior to acquisition. We engaged a specially licensed environmental consultant to perform investigations and to prepare necessary submittals to the state regulatory authority. The environmental consultant has concluded that (1) certain identified groundwater contaminants are migrating to the subject property from an off-site source property and (2) certain other detected contaminants are likely related to a historic release on the subject property. We have filed a Downgradient Property Status Opinion (described above) with respect to contamination migrating from off-site. The consultant has recommended conducting additional investigations, including the installation of off-site monitoring wells, to determine the nature and extent of contamination potentially associated with the historic use of the subject property. Our affiliate has authorized such additional investigations and will take necessary further response actions (if any are required).

Some of our properties and certain properties owned by our affiliates are located in urban, industrial and other previously developed areas where fill or current or historical uses of the areas have caused site contamination. Accordingly, it is sometimes necessary to institute special soil and/or groundwater handling procedures in connection with construction and other property operations in order to achieve regulatory closure and ensure that contaminated materials are addressed in an appropriate manner. In these situations it is our practice to investigate the nature and extent of detected contamination and estimate the costs of required response actions and special handling procedures. We then use this information as part of our decision-making process with respect to the acquisition and/or development of the property. For example, we recently acquired a parcel in Massachusetts, formerly used as a quarry/asphalt batching facility, which we may develop in the future. Pre-purchase testing indicated that the site contains relatively low levels of certain contaminants. We have engaged a specially licensed environmental consultant to perform an environmental risk characterization and prepare all necessary regulatory submittals. We anticipate that additional response actions necessary to achieve regulatory closure (if any) will be performed in concert with future construction activities. When appropriate, closure documentation will be submitted for public review and comment pursuant to the state regulatory authority's public information process.

We expect that resolution of the environmental matters relating to the above will not have a material impact on our financial position, results of operations or liquidity.

Newly Issued Accounting Standards

In June 2001, the FASB issued SFAS 141, Business Combinations, and SFAS 142, Goodwill and Other Intangible Assets. The provisions of SFAS 141 apply to all business combinations initiated after June 30, 2001. SFAS 142 becomes effective beginning January 1, 2002. We adopted both these pronouncements for the year ended December 31, 2002 and neither had a material impact on our results of operations, financial position or liquidity.

In August 2001, the FASB issued SFAS 143, Accounting for Asset Retirement Obligations. SFAS 143 requires an entity to record a liability for an obligation associated with the retirement of an asset at the time the liability is incurred by capitalizing the cost as part of the carrying value of the related asset and depreciating it over the remaining useful life of that asset. The standard is effective beginning January 1, 2003. The changes required by SFAS 143 are not expected to have a material impact on our results of operations, financial position or liquidity.

SFAS 144, "Accounting for the Impairment or Disposal of Long-Lived Assets," was issued in October 2001 and addresses how and when to measure impairment on long-lived assets and how to account for long-lived assets that an entity plans to dispose of either through sale, abandonment, exchange, or distribution to owners. The statement's provisions supersede SFAS 121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of," which addressed

asset impairment, and certain provisions of APB Opinion 30 related to reporting the effects of the disposal of a business segment and requires expected future operating losses from discontinued operations to be recorded in the period in which the losses are incurred rather than the measurement date. Under SFAS 144, more dispositions may qualify for discontinued operations treatment in the income statement. The provisions of SFAS 144 became effective on January 1, 2002, and did not have a material impact on results of operations, financial position, or liquidity.

In April 2002, the FASB issued SFAS 145, which updates, clarifies, and simplifies certain existing accounting pronouncements beginning at various dates in 2002 and 2003. The statement rescinds SFAS 4 and SFAS 64, which required net gains or losses from the extinguishment of debt to be classified as an extraordinary item in the income statement. We anticipate that these gains and losses will no longer be classified as extraordinary as they are not unusual and infrequent in nature. The changes required by SFAS 145 are not expected to have a material impact on our results of operations, financial position, or liquidity.

SFAS 146, "Accounting for Costs Associated with Exit or Disposal Activities," was issued in July 2002 and becomes effective for us beginning January 1, 2003. This statement requires a cost associated with an exit or disposal activity, such as the sale or termination of a line of business, the closure of business activities in a particular location, or a change in management structure, to be recorded as a liability at fair value when it becomes probable the cost will be incurred and no future economic benefit will be gained by the company for such termination costs, and costs to consolidate facilities or relocate employees. SFAS 146 supersedes EITF Issue No. 94-3, "Liability Recognition for Certain Employee Termination Benefits and Other Costs to Exit an Activity," which in some cases required certain costs to be recognized before a liability was actually incurred. The adoption of this standard is not expected to have a material impact on our results of operations, financial position, or liquidity.

In December 2002, the FASB issued SFAS 148, "Accounting for Stock-Based Compensation—Transition and Disclosure," which provides guidance on how to transition from the intrinsic value method of accounting for stock-based employee compensation under APB 25 to SFAS 123's fair value method of accounting, if a company so elects. The adoption of this standard is not expected to have a material impact on our results of operations, financial position or liquidity.

In November 2002, the FASB issued FASB Interpretation No. 45 (FIN 45), "Guarantor's Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others." This interpretation expands the disclosures to be made by a guarantor in its financial statements about its obligations under certain guarantees and requires the guarantor to recognize a liability for the fair value of an obligation assumed under a guarantee. FIN 45 clarifies the requirements of SFAS 5, Accounting for Contingencies, relating to guarantees. In general, FIN 45 applies to contracts or indemnification agreements that contingently require the guarantor to make payments to the guaranteed party based on changes in an underlying that is related to an asset, liability, or equity security of the guaranteed party. The disclosure requirements of FIN 45 are effective to us as of December 31, 2002, and require disclosure of the nature of the guarantee, the maximum potential amount of future payments that the guarantor could be required to make under the guarantee, and the current amount of the liability, if any, for the guarantor's obligations under the guarantee. The recognition requirements of FIN 45 are to be applied prospectively to guarantees issued or modified after December 31, 2002. We do not expect the requirements of FIN 45 to have a material impact on results of operations, financial position, or liquidity.

In January 2003, the FASB issued FASB Interpretation No. 46 (FIN 46), "Consolidation of Variable Interest Entities." The objective of this interpretation is to provide guidance on how to identify a variable interest entity ("VIE") and determine when the assets, liabilities, noncontrolling interests, and results of operations of a VIE need to be included in a company's consolidated financial

statements. A company that holds variable interests in an entity will need to consolidate the entity if the company's interest in the VIE is such that the company will absorb a majority of the VIE's expected losses and/or receive a majority of the entity's expected residual returns, if they occur. FIN 46 also requires additional disclosures by primary beneficiaries and other significant variable interest holders. The provisions of this interpretation became effective upon issuance. We do not believe the adoption of the interpretation will have a material impact on results of operations, financial position, or liquidity.

Inflation

Substantially all of our leases provide for separate real estate tax and operating expense escalations over a base amount. In addition, many of our leases provide for fixed base rent increases or indexed increases. We believe that inflationary increases may be at least partially offset by the contractual rent increases described above.

Item 7A. Quantitative and Qualitative Disclosures about Market Risk

Approximately $3.9 billion of our borrowings bears interest at fixed rates, and therefore the fair value of these instruments is affected by changes in the market interest rates. The following table presents our aggregate fixed rate debt obligations with corresponding weighted average interest rates sorted by maturity date and our aggregate variable rate debt obligations sorted by maturity date.. The interest rate on the variable rate debt as of December 31, 2002 ranged from LIBOR or Eurodollar plus 1.25% to LIBOR or Eurodollar plus 1.95%.

	2003			2004			2005			2006			2007			2008+			Total			Fair Value
	Secured debt
Fixed Rate	$	112,010		$	114,601		$	277,829		$	284,458		$	182,632		$	2,171,291		$	3,142,821		$	3,301,000
Average Interest Rate		7.03	%		7.36	%		7.05	%		7.79	%		6.59	%		7.15	%		7.17	%
Variable Rate	$	819,486		$	297,254		$	7,558			—			—			—		$	1,124,298		$	1,124,298
	Unsecured debt
Fixed Rate		—			—			—			—			—		$	747,375		$	747,375		$	761,700
Average Interest Rate		—			—			—			—			—			6.25	%		6.25	%
Variable Rate	$	132,726			—			—			—			—			—		$	132,726		$	132,726

During the year ended December 31, 2002, we had derivative contracts totaling $150 million. The derivative agreements provide for a fixed interest rate of 6.35% when LIBOR is less than 5.80%, 6.70% when LIBOR is between 6.70% and 7.45%, and 7.50% when LIBOR is between 7.51% and 9.00% for terms remaining of one to three years in accordance with the terms of the individual agreement. In accordance with FAS 133 "Accounting for Derivative Instruments and Hedging Activities," the derivative agreements are reflected at their fair market value, which was a liability of $14.5 million at December 31, 2002.

Additional disclosure about market risk is incorporated herein by reference from Item 7 Management's Discussion and Analysis of Financial Condition and Results of Operations in the market risk section.

Item 8. Financial Statements and Supplementary Data

See "Index to Financial Statements" on page 71 of this Form 10-K.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosures

None.

PART III

Item 10. Directors and Executive Officers of the Registrant

The information concerning our directors and executive officers required by Item 10 shall be included in the Proxy Statement to be filed relating to our 2003 Annual Meeting of Stockholders and is incorporated herein by reference.

Item 11. Executive Compensation

The information concerning our executive compensation required by Item 11 shall be included in the Proxy Statement to be filed relating to our 2003 Annual Meeting of Stockholders and is incorporated herein by reference.

Item 12. Security Ownership of Beneficial Owners and Management

Equity Compensation Plan Information
Plan category		Number of securities to be issued upon exercise of outstanding options, warrants and rights		Weighted-average exercise price of outstanding options, warrants and rights			Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
		(a)		(b)			(c)
Equity compensation plans approved by security holders(1)		11,989,413	(2)	$	34.80	(3)	3,192,911
Equity compensation plans not approved by security holders(4)		N/A			N/A		216,647

	Total	11,989,413		$	34.80		3,409,558

(1): Includes information related to our 1997 Stock Option and Incentive Plan.
(2): Does not include 132,414 shares of restricted stock as they have been reflected in our total shares outstanding.
(3): Does not include outstanding deferred stock awards granted to members of the board of directors as there is no associated exercise price.
(4): Includes information related to the 1999 Non-Qualified Employee Stock Purchase Plan.

The 1999 Non-Qualified Employee Stock Purchase Plan (the "ESPP")

The ESPP was adopted by the Board of Directors on October 29, 1998. The ESPP has not been approved by our shareholders. The ESPP is available to all employees of the Company that are employed on the first day of the purchase period. Under the ESPP, each eligible employee may purchase shares of our common stock at semi-annual intervals each year at a purchase price equal to 85% of the average closing prices of Boston Properties common stock on the New York Stock Exchange during the last ten business days of the purchase period. Each eligible employee may contribute no more than $10,000 per year to purchase Boston Properties common stock under the ESPP.

Additional information concerning our directors and executive officers required by Item 12 shall be included in the Proxy Statement to be filed relating to our 2003 Annual Meeting of Stockholders and is incorporated herein by reference.

Item 13. Certain Relationships and Related Transactions

The information concerning our directors and executive officers required by Item 13 shall be included in the Proxy Statement to be filed relating to our 2003 Annual Meeting of our stockholders and is incorporated herein by reference.

Item 14. Controls and Procedures

(a): Evaluation of disclosure controls and procedures.

As required by new Rule 13a-15 under the Securities Exchange Act of 1934, within the 90 days prior to the date of this report, the Company carried out an evaluation under the supervision and with the participation of the Company's management, including the Company's Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company's disclosure controls and procedures. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company's disclosure controls and procedures are effective to ensure that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission's rules and forms.

(b): Change in internal controls.

None.

Item 15. Exhibits, Financial Statement Schedule and Reports on Form 8-K

(a): Financial Statements and Financial Statement Schedule

See "Index to Financial Statements" on page 71 of this Form 10-K.

(b): Reports on Form 8-K

We filed a report on Form 8-K on January 23, 2002 which included information regarding Item 5. We filed this Form 8-K in connection with our press release relating to our fourth quarter 2001 earnings and information presented to investors and analysts.

We filed a report on Form 8-K on April 24, 2002 which included information regarding Item 5. We filed this Form 8-K in connection with our press release relating to our first quarter 2002 earnings and information presented to investors and analysts.

We filed a report on Form 8-K on July 24, 2002 which included information regarding Item 5. We filed this Form 8-K in connection with our press release relating to our second quarter 2002 earnings and information presented to investors and analysts.

We filed a report on Form 8-K on August 15, 2002 which included information regarding Item 9. The Form 8-K was filed in connection with the certification of our 10-Q for the quarter ended June 30, 2002 by our CEO and CFO.

We filed a report on Form 8-K on October 8, 2002 (as amended by Form 8-K/A filed on December 4, 2002 and December 13, 2002) which included information regarding Item 2, 5 and 7. Included in Item 7 was pro forma information and exhibits. The Form 8-K was filed in connection with our acquisition of 399 Park Avenue.

We filed a report on Form 8-K on October 23, 2002 which included information regarding Item 5. We filed this Form 8-K in connection with our press release relating to our third quarter 2002 earnings and information presented to investors and analysts.

We filed a report on Form 8-K on November 7, 2002 which included information regarding Item 5. The Form 8-K was filed in connection with information presented to investors and analysts.

We filed a report on Form 8-K on November 15, 2002 which included information regarding Item 5. The Form 8-K was filed in connection with the re-issuance of our 10-K due to the adoption of FASB 144.

We filed a report on Form 8-K on December 5, 2002 which included information regarding Item 5. The Form 8-K was filed in connection with the commencement of our Rule 144A offering of senior unsecured notes.

We filed a report on Form 8-K on December 11, 2002 which included information regarding Item 5. The Form 8-K was filed in connection with the commencement of our Rule 144A offering of senior unsecured notes.

(c): Exhibits

Exhibit No.		Description
3.1		Form of Amended and Restated Certificate of Incorporation of Boston Properties, Inc.(1)
3.2		Form of Amended and Restated Bylaws of Boston Properties, Inc.(1)
3.3		Amendment No. 1 to Amended and Restated Bylaws of Boston Properties, Inc.(5)
4.1		Form of Shareholder Rights Agreement dated as of June, 1997 between Boston Properties, Inc. and BankBoston, N.A., as Rights Agent.(1)
4.2		Form of Certificate of Designation for Series E Junior Participating Cumulative Preferred Stock, par value $.01 per share.(1)
4.3		Form of Certificate of Designations for the Series A Preferred Stock.(4)
4.4		Form of Common Stock Certificate.(1)
4.5		Indenture by and between Boston Properties Limited Partnership and The Bank of New York, as Trustee, dated as of December 13, 2002.(11)
4.6		Supplemental Indenture No. 1 by and between Boston Properties Limited Partnership and The Bank of New York, as Trustee, dated as of December 13, 2002, including a form of the 6.25% Senior Note due 2013.(11)
4.7		Supplemental Indenture No. 2 by and between Boston Properties Limited Partnership and The Bank of New York, as Trustee, dated as of January 17, 2003, including a form of the 6.25% Senior Note due 2013.(12)
10.1		Second Amended and Restated Agreement of Limited Partnership of Boston Properties Limited Partnership, dated as of June 29, 1998.(2)
10.2		Certificate of Designations for the Series One Preferred Units, dated June 30, 1998, constituting an amendment to the Second Amended and Restated Agreement of Limited Partnership of Boston Properties Limited Partnership.(2)
10.3		Certificate of Designations for the Series Two Preferred Units, dated November 12, 1998, constituting an amendment to the Second Amendment and Restated Agreement of Limited Partnership of Boston Properties Limited Partnership.(4)
10.4		Amended and Restated 1997 Stock Option and Incentive Plan dated May 3, 2000 and forms of option agreements.(7)
10.5		Amendment #1 to Amended and Restated 1997 Stock Option and Incentive Plan dated November 14, 2000.(7)
10.6		Boston Properties Deferred Compensation Plan effective March 1, 2002(9)
10.7		Employment Agreement by and between Mortimer B. Zuckerman and Boston Properties, Inc. dated as of January 17, 2003.
10.8		Amended and Restated Employment Agreement by and between Edward H. Linde and Boston Properties, Inc. dated as of November 29, 2002.
10.9		Amended and Restated Employment Agreement by and between Robert E. Burke and Boston Properties, Inc. dated as of November 29, 2002.
10.10		Employment Agreement by and between Bryan J. Koop and Boston Properties, Inc. dated as of November 29, 2002.
10.11		Employment Agreement by and between Mitchell S. Landis and Boston Properties, Inc. dated as of November 26, 2002.
10.12		Employment Agreement by and between Douglas T. Linde and Boston Properties, Inc. dated as of November 29, 2002.
10.13		Employment Agreement by and between E. Mitchell Norville and Boston Properties, Inc. dated as of November 29, 2002.
10.14		Employment Agreement by and between Robert E. Pester and Boston Properties, Inc. dated as of December 16, 2002.
10.15		Amended and Restated Employment Agreement by and between Raymond A. Ritchey and Boston Properties, Inc. dated as of November 29, 2002.

10.16		Amended and Restated Employment Agreement by and between Robert E. Selsam and Boston Properties, Inc. dated as of November 29, 2002.
10.17		Senior Executive Severance Agreement by and among Boston Properties, Inc., Boston Properties Limited Partnership and Mortimer B. Zuckerman.
10.18		Senior Executive Severance Agreement by and among Boston Properties, Inc., Boston Properties Limited Partnership and Edward H. Linde.
10.19		Boston Properties, Inc. Senior Executive Severance Plan.
10.20		Boston Properties, Inc. Executive Severance Plan.
10.21		Form of Indemnification Agreement between Boston Properties, Inc. and each of its directors and executive officers.(1)
10.22		Omnibus Option Agreement by and among Boston Properties Limited Partnership and the Grantors named therein dated as of April 9, 1997.(1)
10.23		Third Amended and Restated Revolving Credit Agreement with Fleet National Bank, as agent, dated as of January 17, 2003.
10.24		Form of Lease Agreement dated as of June, 1997 between Edward H. Linde and Mortimer B. Zuckerman, as Trustees of Downtown Boston Properties Trust, and ZL Hotel LLC.(1)
10.25		Form of Lease Agreement dated as of June, 1997 between Edward H. Linde and Mortimer B. Zuckerman, as Trustees of Two Cambridge Center Trust, and ZL Hotel LLC.(1)
10.26		Form of Certificate of Incorporation of Boston Properties Management, Inc.(1)
10.27		Form of By-laws of Boston Properties Management, Inc.(1)
10.28		Form of Limited Liability Company Agreement of ZL Hotel LLC.(1)
10.29		Indemnification Agreement between Boston Properties Limited Partnership and Mortimer B. Zuckerman and Edward H. Linde.(1)
10.30		Compensation Agreement between Boston Properties, Inc. and Robert Selsam, dated as of August 10, 1995 relating to 90 Church Street.(1)
10.31		Contribution and Conveyance Agreement concerning the Carnegie Portfolio, dated June 30, 1998 by and among Boston Properties, Inc., Boston Properties Limited Partnership, and the parties named therein as Landis Parties.(2)
10.32		Contribution Agreement, dated June 30, 1998, by and among Boston Properties, Inc., Boston Properties Limited Partnership, and the parties named therein as Landis Parties.(2)
10.33		Non-Competition Agreement, dated as of June 30, 1998, by and between Alan B. Landis and Boston Properties, Inc.(2)
10.34		Agreement Regarding Directorship, dated as of June 30, 1998, by and between Boston Properties, Inc. and Alan B. Landis.(2)
10.35		Purchase and Sale Agreement, dated May 7, 1998, by and between The Prudential Insurance Company of America and Boston Properties Limited Partnership.(3)
10.36		Contribution Agreement, dated as of May 7, 1998, by and between The Prudential Insurance Company of America and Boston Properties Limited Partnership.(3)
10.37		Purchase and Sale Agreement, dated as of November 12, 1998, by and between Two Embarcadero Center West and BP OFR LLC.(4)
10.38		Contribution Agreement, dated as of November 12, 1998, by and among Boston Properties, Inc., Boston Properties Limited Partnership, Embarcadero Center Investors Partnership and the partners in Embarcadero Center Investors Partnership listed on Exhibit A thereto.(4)
10.39		Contribution Agreement, dated as of November 12, 1998, by and among Boston Properties, Inc., Boston Properties Limited Partnership, Three Embarcadero Center West and the partners in Three Embarcadero Center West listed on Exhibit A thereto.(4)

10.40		Three Embarcadero Center West Redemption Agreement, dated as of November 12, 1998, by and among Three Embarcadero Center West, Boston Properties Limited Partnership, BP EC West LLC, The Prudential Insurance Company of America, PIC Realty Corporation and Prudential Realty Securities II, Inc.(4)
10.41		Three Embarcadero Center West Property Contribution Agreement, dated as of November 12, 1998, by and among Three Embarcadero Center West, The Prudential Insurance Company of America, PIC Realty Corporation, Prudential Realty Securities II, Inc., Boston Properties Limited Partnership, Boston Properties, Inc. and BP EC West LLC.(4)
10.42		Third Amended and Restated Partnership Agreement of One Embarcadero Center Venture, dated as of November 12, 1998, by and between Boston Properties LLC, as managing general partner, BP EC1 Holdings LLC, as non-managing general partner, and PIC Realty Corporation, as non-managing general partner.(4)
10.43		Third Amended and Restated Partnership Agreement of Embarcadero Center Associates, dated as of November 12, 1998, by and between BP LLC, as managing general partner, BP EC2 Holdings LLC, as non-managing general partner, and PIC Realty Corporation, as non- managing general partner.(4)
10.44		Second Amended and Restated Partnership Agreement of Three Embarcadero Center Venture, dated as of November 12, 1998, by and between Boston Properties LLC, as managing general partner, BP EC3 Holdings LLC, as non-managing general partner, and The Prudential Insurance Company of America, as non-managing general partner.(4)
10.45		Second Amended and Restated Partnership Agreement of Four Embarcadero Center Venture, dated as of November 12, 1998, by and between Boston Properties LLC, as managing general partner, BP EC4 Holdings LLC, as non-managing general partner, and The Prudential Insurance Company of America, as non-managing general partner.(4)
10.46		Note Purchase Agreement, dated as of November 12, 1998, by and between Prudential Realty Securities, Inc. and One Embarcadero Center Venture.(4)
10.47		Note Purchase Agreement, dated as of November 12, 1998, by and between Prudential Realty Securities, Inc. and Embarcadero Center Associates.(4)
10.48		Note Purchase Agreement, dated November 12, 1998, by and between Prudential Realty Securities, Inc. and Three Embarcadero Center Venture.(4)
10.49		Note Purchase Agreement, dated November 12, 1998, by and between Prudential Realty Securities, Inc. and Four Embarcadero Center Venture.(4)
10.50		Redemption Agreement, dated as of November 12, 1998, by and among One Embarcadero Center Venture, Boston Properties LLC, BP EC1 Holdings LLC and PIC Realty Corporation.(4)
10.51		Redemption Agreement, dated as of November 12, 1998, by and among Embarcadero Center Associates, Boston Properties LLC, BP EC2 Holdings LLC and PIC Realty Corporation.(4)
10.52		Redemption Agreement, dated as of November 12, 1998, by and among Three Embarcadero Center Venture, Boston Properties LLC, BP EC3 Holdings LLC and The Prudential Insurance Company of America.(4)
10.53		Redemption Agreement, dated as on November 12, 1998, by and among Four Embarcadero Center Venture, Boston Properties LLC, BP EC4 Holdings LLC and The Prudential Insurance Company of America.(4)
10.54		Option and Put Agreement, dated as of November 12, 1998, by and between One Embarcadero Center Venture and The Prudential Insurance Company of America.(4)
10.55		Option and Put Agreement, dated as of November 12, 1998, by and between Embarcadero Center Associates and The Prudential Insurance Company of America.(4)

10.56		Option and Put Agreement, dated as of November 12, 1998, by and between Three Embarcadero Center Venture and The Prudential Insurance Company of America.(4)
10.57		Option and Put Agreement, dated as of November 12, 1998, by and between Four Embarcadero Center Venture and The Prudential Insurance Company of America.(4)
10.58		Stock Purchase Agreement, dated as of September 28, 1998, by and between Boston Properties, Inc. and The Prudential Insurance Company of America.(4)
10.59		Master Agreement by and between New York State Common Retirement Fund and Boston Properties Limited Partnership, dated as of May 12, 2000.(7)
10.60		Contract of Sale, dated as of February 6, 2001, by and between Dai-Ichi Life Investment Properties, Inc., as seller, and Skyline Holdings LLC, as purchaser.(8)
10.61		Agreement to Enter Into Assignment and Assumption of Unit Two Contract of Sale, dated as of February 6, 2001, by and between Dai-Ichi Life Investment Properties, Inc., as assignor, and Skyline Holdings II LLC, as assignee.(8)
10.62		Contract of Sale, dated as of November 22, 2000, by and between Citibank, N.A., as seller, and Dai-Ichi Life Investment Properties, Inc., as purchaser.(8)
10.63		Assignment and Assumption Agreement, dated as of April 25, 2001, by and between Skyline Holdings LLC, as assignor, and BP/CGCenter I LLC, as assignee.(8)
10.64		Assignment and Assumption Agreement, dated as of April 25, 2001, by and between Skyline Holdings II LLC, as assignor, and BP/CGCenter II LLC, as assignee.(8)
10.65		Assignment and Assumption of Contract of Sale, dated as of April 25, 2001, by and among Dai-Ichi Life Investment Properties, Inc., as assignor, BP/CGCenter II LLC, as assignee, and Citibank, N.A., as seller.(8)
10.66		Amended and Restated Operating Agreement of BP/CGCenter Acquisition Co. LLC, a Delaware limited liability company.(8)
10.67		Purchase and Sale Agreement by and between Citibank, N.A. and BP 399 Park Avenue LLC, dated as of August 28, 2002.(10)
10.68		Credit Agreement by and among Boston Properties Limited Partnership, BP 399 Park Avenue LLC, certain other subsidiaries of Boston Properties Limited Partnership and the banks and others that are parties thereto, dated as of September 25, 2002.(10)
21.1		Schedule of Subsidiaries of Boston Properties, Inc.
23.1		Consent of PricewaterhouseCoopers LLP, Independent Accountants.

(1): Incorporated herein by reference to Boston Properties, Inc.'s Registration Statement on Form S-11. (No. 333-25279)
(2): Incorporated herein by reference to Boston Properties, Inc.'s Current Report on Form 8-K filed on July 15, 1998.
(3): Incorporated herein by reference to Boston Properties, Inc.'s Current Report on Form 8-K filed on July 17, 1998.
(4): Incorporated herein by reference to Boston Properties, Inc.'s Current Report on Form 8-K filed on November 25, 1998.
(5): Incorporated herein by reference to Boston Properties, Inc.'s Annual Report on Form 10-K filed on March 24, 2000.
(6): Incorporated herein by reference to Boston Properties, Inc.'s Quarterly Report on Form 10-Q filed on May 15, 2000.
(7): Incorporated herein by reference to Boston Properties, Inc.'s Annual Report on Form 10-K filed on March 30, 2001.

(8): Incorporated herein by reference to Boston Properties, Inc.'s Current Report on Form 8-K filed on May 10, 2001.
(9): Incorporated herein by reference to Boston Properties, Inc.'s Quarterly Report on Form 10-Q filed on May 15, 2002.
(10): Incorporated herein by reference to Boston Properties, Inc.'s Current Report on Form 8-K filed on October 8, 2002.
(11): Incorporated herein by reference to Boston Properties, Inc.'s Current Report on Form 8-K/A filed on December 13, 2002.
(12): Incorporated herein by reference to Boston Properties, Inc.'s Current Report on Form 8-K filed on January 23, 2002.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant, Boston Properties, Inc., has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	Boston Properties, Inc.
Date
February 25, 2003	By:	/s/ DOUGLAS T. LINDE Douglas T. Linde Chief Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

February 25, 2003	By:	/s/ MORTIMER B. ZUCKERMAN Mortimer B. Zuckerman Chairman of the Board of Directors

	By:	/s/ EDWARD H. LINDE Edward H. Linde President and Chief Executive Officer

	By:	/s/ DOUGLAS T. LINDE Douglas T. Linde Chief Financial Officer

	By:	/s/ ALAN J. PATRICOF Alan J. Patricof Director

	By:	/s/ IVAN G. SEIDENBERG Ivan G. Seidenberg Director

	By:	/s/ MARTIN TURCHIN Martin Turchin Director

	By:	/s/ ALAN B. LANDIS Alan B. Landis Director

	By:	/s/ RICHARD E. SALOMON Richard E. Salomon Director

CERTIFICATION

I, Edward H. Linde, certify that:

1.

I have reviewed this annual report on Form 10-K of Boston Properties, Inc.;

2.

Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;

3.

Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;

4.

The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

a): designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared;
b): evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this annual report (the "Evaluation Date"); and
c): presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5.

The registrant's other certifying officer and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):

a): all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and
b): any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and

6.: The registrant's other certifying officer and I have indicated in this annual report whether there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

DATE: February 25, 2003

/s/ EDWARD H. LINDE

Edward H. Linde
Chief Executive Officer

CERTIFICATION

I, Douglas T. Linde, certify that:

1.

I have reviewed this annual report on Form 10-K of Boston Properties, Inc.;

2.

3.

4.

a): designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared;
b): evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this annual report (the "Evaluation Date"); and
c): presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5.

a): all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and
b): any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and

6.: The registrant's other certifying officer and I have indicated in this annual report whether there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

DATE: February 25, 2003

/s/ DOUGLAS T. LINDE

Douglas T. Linde
Chief Financial Officer

BOSTON PROPERTIES, INC.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

		Page
Report of Independent Accountants		72
Consolidated Balance Sheets as of December 31, 2002 and 2001		73
Consolidated Statements of Operations for the years ended December 31, 2002, 2001 and 2000		74
Consolidated Statements of Stockholder's Equity for the years ended December 31, 2002, 2001 and 2000		75
Consolidated Statements of Comprehensive Income for the years ended December 31, 2002, 2001 and 2000		76
Consolidated Statements of Cash Flows for the years ended December 31, 2002, 2001 and 2000		77
Notes to Consolidated Financial Statements		79
Financial Statement Schedule—Schedule III		110

All other schedules for which a provision is made in the applicable accounting regulations of the Securities and Exchange Commission are not required under the related instructions or are inapplicable, and therefore have been omitted.

REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors and Stockholders of
Boston Properties, Inc.:

In our opinion, the consolidated financial statements listed in the accompanying index present fairly, in all material respects, the financial position of Boston Properties, Inc. (the "Company") at December 31, 2002 and 2001, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2002 in conformity with accounting principles generally accepted in the United States of America. In addition, in our opinion, the financial statement schedule listed in the accompanying index presents fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. These financial statements and financial statement schedule are the responsibility of the Company's management; our responsibility is to express an opinion on these financial statements and financial statement schedule based on our audits. We conducted our audits of these statements in accordance with auditing standards generally accepted in the United States of America, which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

As discussed in Note 21 to the consolidated financial statements, the Company, on January 1, 2001, adopted Statement of Financial Accounting Standards No. 133, "Accounting for Derivative Instruments and Hedging Activities", as amended and interpreted. Also, as discussed in Note 22 to the consolidated financial statements, on January 1, 2002, the Company adopted the provisions of Statement of Financial Accounting Standards No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets".

/s/ PricewaterhouseCoopers LLP

Boston, Massachusetts
February 21, 2003

BOSTON PROPERTIES, INC.

CONSOLIDATED BALANCE SHEETS

				December 31, 2002			December 31, 2001
				(in thousands, except for share and par value amounts)
ASSETS
Real estate:				$	8,670,711		$	7,457,906
	Less: accumulated depreciation				(822,933	)		(719,854	)

		Total real estate			7,847,778			6,738,052
Cash and cash equivalents					55,275			98,067
Cash held in escrows					41,906			23,000
Investments in securities					—			4,297
Tenant and other receivables (net of allowance for doubtful accounts of $3,682 and $2,394, respectively)					20,458			43,546
Accrued rental income (net of allowance of $5,000 and $3,300, respectively)					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 payable			$	4,267,119		$	4,314,942
	Unsecured senior notes (net of discount of $2,625)				747,375			—
	Unsecured bridge loan				105,683			—
	Unsecured line of credit				27,043			—
	Accounts payable and accrued expenses				73,846			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				81,085			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, 95,441,890 and 90,859,491 issued and 95,362,990 and 90,780,591 outstanding in 2002 and 2001, respectively				954			908
	Additional paid-in capital				1,982,689			1,789,521
	Earnings in excess of dividends (dividends in excess of earnings)				198,586			(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

The accompanying notes are an integral part of these financial statements.

BOSTON PROPERTIES, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

				For the Year Ended December 31,
				2002			2001			2000
				(In thousands, except for per share amounts)
Revenue
	Rental:
		Base rent		$	978,382		$	843,147		$	710,842
		Recoveries from tenants			144,576			127,024			107,502
		Parking and other			50,827			51,999			50,892

			Total rental revenue		1,173,785			1,022,170			869,236
	Hotel revenue				44,786			—			—
	Development and management services				10,748			12,167			11,837
	Interest and other				5,504			12,183			8,558

			Total revenue		1,234,823			1,046,520			889,631

Expenses
	Operating
		Rental			385,491			330,301			279,671
		Hotel			31,086			—			—
	General and administrative				47,292			38,312			35,659
	Interest				271,685			223,389			217,064
	Depreciation and amortization				186,177			149,181			132,223
	Net derivative losses				11,874			26,488			—
	Losses on investments in securities				4,297			6,500			—

			Total expenses		937,902			774,171			664,617

Income before minority interests in property partnerships, income from unconsolidated joint ventures, minority interest in Operating Partnership, gains (losses) 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					296,921			272,349			225,014
Minority interests in property partnerships					2,065			1,085			(932	)
Income from unconsolidated joint ventures					7,954			4,186			1,758

Income before minority interest in Operating Partnership, gains (losses) 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					306,940			277,620			225,840
Minority interest in Operating Partnership					(77,524	)		(74,739	)		(75,088	)

Income before gains (losses) 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					229,416			202,881			150,752
Gains (losses) on sales of real estate, net of minority interest					186,810			6,505			(234	)
Gains on sales of land held for development, net of minority interest					3,633			2,584			—

Income before discontinued operations, extraordinary items, cumulative effect of a change in accounting principle and preferred dividend					419,859			211,970			150,518
Discontinued operations:
	Income from discontinued operations, net of minority interest				1,135			2,829			2,814
	Gains on sales of real estate from discontinued operations, net of minority interest				25,345			—			—

Income before extraordinary items, cumulative effect of a change in accounting principle and preferred dividend					446,339			214,799			153,332
Extraordinary items, net of minority interest					(1,956	)		—			(334	)

Income before cumulative effect of a change in accounting principle and preferred dividend					444,383			214,799			152,998
Cumulative effect of a change in accounting principle, net of minority interest					—			(6,767	)		—

Net income before preferred dividend					444,383			208,032			152,998
Preferred dividend					(3,412	)		(6,592	)		(6,572	)

Net income available to common shareholders				$	440,971		$	201,440		$	146,426

Basic earnings per common share:
	Income available to common shareholders before discontinued operations, extraordinary items and cumulative effect of a change in accounting principle			$	4.47		$	2.28		$	2.01
	Discontinued operations, net of minority interest				0.28			0.03			0.04
	Extraordinary items, net of minority interest				(0.02	)		—			—
	Cumulative effect of a change in accounting principle, net of minority interest				—			(0.07	)		—

	Net income available to common shareholders			$	4.73		$	2.24		$	2.05

	Weighted average number of common shares outstanding				93,145			90,002			71,424

Diluted earnings per common share:
	Income available to common shareholders before discontinued operations, extraordinary items and cumulative effect of a change in accounting principle			$	4.40		$	2.23		$	1.97
	Discontinued operations, net of minority interest				0.28			0.03			0.04
	Extraordinary items, net of minority interest				(0.02	)		—			—
	Cumulative effect of a change in accounting principle, net of minority interest				—			(0.07	)		—

	Net income available to common shareholders			$	4.66		$	2.19		$	2.01

	Weighted average number of common and common equivalent shares outstanding				94,612			92,200			72,741

The accompanying notes are an integral part of these financial statements.

BOSTON PROPERTIES, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(in thousands)

	Common Stock																Accumulated Other Comprehensive Loss
	Common Stock				Additional Paid-in Capital			Earnings in excess of Dividends			Treasury Stock, at cost			Unearned Compensation
	Shares		Amount		Additional Paid-in Capital			Earnings in excess of Dividends			Treasury Stock, at cost			Unearned Compensation						Total
Stockholders' Equity, December 31, 1999	67,910		$	679	$	1,067,778		$	(10,893	)	$	—		$	—		$	—		$	1,057,564
Sale of Common Stock net of offering costs	17,110			171		633,591			—			—			—			—			633,762
Unregistered Common Stock issued	439			4		18,156			—			—			—			—			18,160
Conversion of operating partnership units to Common Stock	614			6		20,239			—			—			—			—			20,245
Allocation of minority interest	—			—		(85,809	)		—			—			—			—			(85,809	)
Net income for the year	—			—		—			146,426			—			—			—			146,426
Dividends declared	—			—		—			(149,428	)		—			—			—			(149,428	)
Shares issued pursuant to stock purchase plan	11			—		374			—			—			—			—			374
Stock options exercised	511			5		17,961			—			—			—			—			17,966
Issuance of restricted stock	35			1		1,059			—			—			(1,060	)		—			—
Amortization of restricted stock award	—			—		—			—			—			212			—			212
Unrealized holding losses	—			—		—			—			—			—			(11,745	)		(11,745	)

Stockholders' Equity, December 31, 2000	86,630			866		1,673,349			(13,895	)		—			(848	)		(11,745	)		1,647,727
Conversion of operating partnership units to Common Stock	3,765			38		149,588			—			—			—			—			149,626
Allocation of minority interest	—			—		(47,852	)		—			—			—			—			(47,852	)
Net income for the year	—			—		—			201,440			—			—			—			201,440
Dividends declared	—			—		—			(205,214	)		—			—			—			(205,214	)
Shares issued pursuant to stock purchase plan	8			—		213			—			—			—			—			213
Stock options exercised	412			4		12,396			—			—			—			—			12,400
Treasury stock, at cost	(79	)		—		—			—			(2,722	)		—			—			(2,722	)
Issuance of restricted stock	45			—		1,827			—			—			(1,827	)		—			—
Amortization of restricted stock award	—			—		—			—			—			578			—			578
Unrealized holding losses	—			—		—			—			—			—			(2,123	)		(2,123	)

Stockholders' Equity, December 31, 2001	90,781			908		1,789,521			(17,669	)		(2,722	)		(2,097	)		(13,868	)		1,754,073
Conversion of operating partnership units to Common Stock	1,566			16		59,962			—			—			—			—			59,978
Conversion of preferred stock to Common Stock	2,625			26		99,974			—			—			—			—			100,000
Allocation of minority interest	—			—		21,062			—			—			—			—			21,062
Net income for the year	—			—		—			440,971			—			—			—			440,971
Dividends declared	—			—		—			(224,716	)		—			—			—			(224,716	)
Shares issued pursuant to stock purchase plan	8			—		284			—			—			—			—			284
Stock options exercised	330			3		9,898			—			—			—			—			9,901
Issuance of restricted stock	53			1		1,988			—			—			(1,989	)		—			—
Amortization of restricted stock award	—			—		—			—			—			1,187			—			1,187
Change in unrealized losses on derivative instruments used in cash flow hedging arrangements	—			—		—			—			—			—			(3,511	)		(3,511	)
Amortization of interest rate contracts	—			—		—			—			—			—			361			361

Stockholders' Equity, December 31, 2002	95,363		$	954	$	1,982,689		$	198,586		$	(2,722	)	$	(2,899	)	$	(17,018	)	$	2,159,590

The accompanying notes are an integral part of these financial statements.

BOSTON PROPERTIES, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

			For the year ended December 31,
			2002			2001			2000
			(in thousands)
Net income before preferred dividend			$	444,383		$	208,032		$	152,998
Other comprehensive loss:
	Amortization of interest rate contracts			361			—			—
	Realized loss on investments in securities included in net income before preferred dividend			—			6,500			—
	Unrealized gains (losses) on investments in securities:
		Unrealized holding losses arising during the period		—			(1,608	)		(11,745	)
		Less: reclassification adjustment for the cumulative effect of a change in accounting principle included in net income before preferred dividend		—			6,853			—
	Unrealized derivative losses:
		Transition adjustment of interest rate contracts		—			(11,414	)		—
		Change in unrealized losses on derivative instruments used in cash flow hedging arrangements		(3,511	)		(2,454	)		—

Other comprehensive loss				(3,150	)		(2,123	)		(11,745	)

Comprehensive income			$	441,233		$	205,909		$	141,253

The accompanying notes are an integral part of these financial statements

BOSTON PROPERTIES, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

				For the year ended December 31,
				2002			2001			2000
				(in thousands)
Cash flows from operating activities:
	Net income before preferred dividend			$	444,383		$	208,032		$	152,998
	Adjustments to reconcile net income before preferred dividend to net cash provided by operating activities:
		Depreciation and amortization			186,429			150,163			133,150
		Non-cash portion of interest expense			5,558			3,937			3,693
		Non-cash compensation expense			1,187			578			2,170
		Loss on investments in securities			4,297			6,500			—
		Non-cash portion of derivative losses			4,478			(5,014	)		—
		Payments on deferred interest rate contracts			(3,511	)		—			—
		Minority interests in property partnerships			(2,065	)		(1,085	)		932
		Earnings in excess of distributions from unconsolidated joint ventures			738			(1,451	)		90
		Minority interest in Operating Partnership			124,775			75,878			75,860
		Losses (gains) on sales of properties			(263,220	)		(11,239	)		314
		Extraordinary loss			554			—			433
		Cumulative effect of a change in accounting principle			—			8,432			—
	Change in assets and liabilities:
		Cash held in escrows			1,094			4,951			12,303
		Tenant and other receivables, net			23,027			(16,694	)		1,407
		Accrued rental income, net			(50,466	)		(27,961	)		(14,509	)
		Prepaid expenses and other assets			1,108			10,154			(2,792	)
		Accounts payable and accrued expenses			3,216			29,265			(14,300	)
		Accrued interest payable			16,061			3,481			(2,887	)
		Other liabilities			1,848			8,580			1,644
		Tenant leasing costs			(62,111	)		(27,104	)		(21,032	)

			Total adjustments		(7,003	)		211,371			176,476

			Net cash provided by operating activities		437,380			419,403			329,474

Cash flows from investing activities:
	Acquisitions/additions to real estate				(1,432,302	)		(1,322,565	)		(615,006	)
	Investments in unconsolidated joint ventures				(4,158	)		(7,163	)		(16,582	)
	Net proceeds from sales of real estate				419,177			26,106			70,712
	Investments in securities				—			—			(2,297	)

			Net cash used in investing activities		(1,017,283	)		(1,303,622	)		(563,173	)

			For the year ended December 31,
			2002			2001			2000
			(in thousands)
Cash flows from financing activities:
	Net proceeds from the issuance of common stock			—			—			633,762
	Borrowings on unsecured line of credit			200,098			111,200			184,000
	Repayments of unsecured line of credit			(173,055	)		(111,200	)		(550,000	)
	Repayments of mortgage notes			(417,230	)		(229,021	)		(525,241	)
	Proceeds from mortgage notes			369,155			1,128,534			976,390
	Proceeds from unsecured senior notes			747,375			—			—
	Proceeds from unsecured bridge loan			1,000,000			—			—
	Repayments of unsecured bridge loan			(894,317	)		—			—
	Mortgage payable proceeds released from escrow			—			57,610			—
	Dividends and distributions			(297,331	)		(276,538	)		(209,723	)
	Proceeds from stock transactions			9,774			12,665			16,382
	Purchase of treasury common stock			—			(2,722	)		—
	Net (distributions) contributions to/from minority interest holder			(1,539	)		37,539			—
	Deferred financing costs			(5,819	)		(26,738	)		(22,949	)

		Net cash provided by financing activities		537,111			701,329			502,621

Net increase (decrease) in cash and cash equivalents				(42,792	)		(182,890	)		268,922
Cash and cash equivalents, beginning of period				98,067			280,957			12,035

Cash and cash equivalents, end of period			$	55,275		$	98,067		$	280,957

Supplemental disclosures:
	Cash paid for interest		$	272,576		$	275,263		$	253,971

	Interest capitalized		$	22,510		$	59,292		$	37,713

Non-cash investing and financing activities:
	Additions to real estate included in accounts payable		$	10,067		$	5,547		$	4,858

	Mortgage notes payable assumed in connection with the acquisition of real estate		$	—		$	—		$	117,831

	Mortgage notes payable assigned in connection with the sale of real estate		$	—		$	—		$	166,547

	Mortgage payable proceeds escrowed		$	—		$	—		$	57,610

	Issuance of minority interest in connection with the acquisition of real estate		$	—		$	—		$	44,712

	Dividends and distributions declared but not paid		$	81,226		$	79,561		$	71,274

	Common stock issued in connection with an acquisition of real estate		$	—		$	—		$	2,660

	Common stock issued in connection with an acquisition of minority interest		$	—		$	—		$	15,500

	Conversions of minority interest to Stockholders' Equity		$	30,247		$	119,604		$	20,245

	Conversions of Preferred Stock to Stockholders' Equity		$	100,000		$	—		$	—

	Basis adjustment in connection with conversions of minority interest to Stockholders' Equity		$	29,731		$	33,927		$	—

	Deposit received on real estate held for sale escrowed		$	20,000		$	—		$	—

	Real estate contributed to joint ventures		$	—		$	—		$	36,999

	Issuance of restricted shares to employees		$	1,989		$	1,827		$	1,060

	Unrealized loss related to investments in securities		$	—		$	1,608		$	11,745

The accompanying notes are an integral part of these financial statements

BOSTON PROPERTIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Organization and Basis of Presentation

Organization

Boston Properties, Inc. (the "Company"), a Delaware corporation, is a self-administered and self-managed real estate investment trust ("REIT"). Boston Properties, Inc. is the sole general partner of Boston Properties Limited Partnership (the "Operating Partnership") and at December 31, 2002, owned an approximate 76.3% (75.0% at December 31, 2001) general and limited partnership interest in the Operating Partnership. Partnership interests in the Operating Partnership are denominated as "common units of partnership interest" (also referred to as "OP Units") or "preferred units of partnership interest" (also referred to as "Preferred Units"). All references to OP Units and Preferred Units exclude such units held by the Company. A holder of an OP Unit may present such OP Unit to the Operating Partnership for redemption at any time (subject to restrictions agreed upon at the issuance of OP Units to particular holders that may restrict such right for a period of time, generally one year from issuance). Upon presentation of an OP Unit for redemption, the Operating Partnership must redeem such OP Unit for cash equal to the then value of a share of common stock of the Company ("Common Stock"), except that the Company may, at its election, in lieu of a cash redemption, acquire such OP Unit for one share of Common Stock. Because the number of shares of Common Stock outstanding at all times equals the number of OP Units that the Company owns, one share of Common Stock is generally the economic equivalent of one OP Unit, and the quarterly distribution that may be paid to the holder of an OP Unit equals the quarterly dividend that may be paid to the holder of a share of Common Stock. Each series of Preferred Units bears a distribution that is set in accordance with an amendment to the partnership agreement of the Operating Partnership. Preferred Units may also be convertible into OP Units at the election of the holder thereof or the Company, subject to the terms of such Preferred Units.

All references to the Company hereafter refer to Boston Properties, Inc. and its subsidiaries, including the Operating Partnership, collectively, unless the context otherwise requires.

Properties

At December 31, 2002, the Company owned or had interests in a portfolio of 142 commercial real estate properties (147 properties at December 31, 2001) (the "Properties") aggregating more than 42.4 million net rentable square feet (including six properties under construction totaling approximately 2.8 million net rentable square feet). The Properties consist of 133 office properties, including 105 Class A office properties and 28 Office/Technical properties; four industrial properties; three hotels; two retail properties; and structured parking for 20,710 vehicles containing approximately 6.7 million square feet. In addition, the Company owns, controls or has interests in 41 parcels of land totaling 539.6 acres (which will support approximately 8.8 million net rentable square feet of development). The Company considers Class A office properties to be centrally located buildings that are professionally managed and maintained, that attract high-quality tenants and command upper-tier rental rates, and that are modern structures or have been modernized to compete with newer buildings. The Company considers Office/Technical properties to be properties that support office, research and development and other technical uses.

Basis of Presentation

The consolidated financial statements of the Company include all the accounts of the Company, its majority-owned Operating Partnership, and consolidated subsidiaries. All significant intercompany balances and transactions have been eliminated.

2. Summary of Significant Accounting Policies

Real Estate

Real estate is stated at depreciated cost, which in the opinion of management is not in excess of the individual property's estimated undiscounted future cash flows, including estimated proceeds from disposition. The cost of buildings and improvements include the purchase price of the property, legal fees and acquisition costs. Certain qualifying costs related to development properties are capitalized. Capitalized development costs include interest, wages, property taxes, insurance and other project costs incurred during the period of development.

The Company periodically reviews its properties to determine if their carrying amounts will be recovered from future operating cash flows. The evaluation of anticipated cash flows is highly subjective and is based in part on assumptions regarding future occupancy, rental rates and capital requirements that could differ materially from actual results in future periods. Since cash flows are considered on an undiscounted basis in the analysis that the Company conducts to determine whether an asset has been impaired, the Company's established strategy of holding properties over the long term directly decreases the likelihood of recording an impairment loss. If the Company's strategy changes or market conditions otherwise dictate an earlier sale date, an impairment loss may be recognized. If the Company determines that an impairment has occurred, the affected assets must be reduced to their fair value. No such impairment losses have been recognized to date.

The costs of land and buildings under development include specifically identifiable costs. The capitalized costs include pre-construction costs essential to the development of the property, development costs, construction costs, interest costs, real estate taxes, salaries and related costs and other costs incurred during the period of development. The Company ceases cost capitalization when the property is held available for occupancy upon substantial completion of tenant improvements, but no later than one year from the completion of major construction activity. Interest costs capitalized for the years ended December 31, 2002, 2001 and 2000 were $22.5 million, $59.3 million and $37.7 million, respectively. Salaries and related costs capitalized for the years ended December 31, 2002, 2001 and 2000 were $4.4 million, $5.8 million and $4.9 million, respectively.

The Company accounts for properties as held for sale under the provisions of Statement of Financial Accounting Standards ("SFAS") No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets", which typically occurs upon the execution of a purchase and sale agreement. Upon determining that a property is held for sale, the Company discontinues depreciating the property and reflects the property at the lower of its carrying amount or fair value less the cost to sell in its consolidated balance sheets.

The acquisitions of minority interests for shares of the Company's Common Stock are recorded under the purchase method with assets acquired reflected at the fair market value of the Company's Common Stock on the date of acquisition. The acquisition amounts are allocated to real estate based on their estimated fair values.

Expenditures for repairs and maintenance are charged to operations as incurred. Significant betterments are capitalized. When assets are sold or retired, their costs and related accumulated

depreciation are removed from the accounts with the resulting gains or losses reflected in net income or loss for the period.

Depreciation is computed on the straight-line basis over the estimated useful lives of the assets as follows:

Land improvements		25 to 40 years
Buildings and improvements		10 to 40 years
Tenant improvements		Shorter of useful life or terms of related lease
Furniture, fixtures, and equipment		3 to 7 years

Cash and Cash Equivalents

Cash and cash equivalents consist of cash on hand and investments with maturities of three months or less from the date of purchase. The majority of the Company's cash and cash equivalents are held at major commercial banks which may at times exceed the Federal Deposit Insurance Corporation limit of $100,000. The Company has not experienced any losses to date on its invested cash.

Cash held in Escrows

Escrows include amounts established pursuant to various agreements for real estate purchase and sale transactions, security deposits, property taxes, insurance and other costs.

Investments in Securities

The Company accounts for investments in securities of publicly traded companies in accordance with Statement of Financial Accounting Standards ("SFAS") No. 115 "Accounting for Certain Investments in Debt and Equity Investments" and has classified the securities as available-for-sale. Investments in securities of non-publicly traded companies are recorded at cost, as they are not considered marketable under SFAS No. 115. During the years ended December 31, 2002 and 2001, the Company realized losses totaling $4.3 million and $6.5 million related to the write-down of securities of three technology companies. The Company determined that the decline in the fair value of these securities was other than temporary as defined by SFAS No. 115.

Tenant and other receivables

Tenant and other receivables are expected to be collected within one year and are reported net of estimated unrecoverable amounts of approximately $3.7 million and $2.4 million at December 31, 2002 and 2001, respectively.

Deferred Charges

Deferred charges include leasing costs and financing costs. Direct and incremental fees and costs incurred in the successful negotiation of leases, including brokerage, legal, internal leasing employee salaries and other costs have been deferred and are being amortized on a straight-line basis over the terms of the respective leases. Internal leasing salaries and related costs capitalized for the years ended December 31, 2002, 2001 and 2000 were approximately $0.7 million, $0.8 million and $0.2 million, respectively. External fees and costs incurred to obtain financing have been deferred and are being amortized over the terms of the respective loans on a basis that approximates the effective interest method and are included with interest expense. Unamortized financing and leasing costs are charged to

expense upon the early repayment or significant modification of the financing or upon the early termination of the lease, respectively. Fully amortized deferred charges are removed from the books upon the expiration of the lease or maturity of the debt.

Investments in Unconsolidated Joint Ventures

The Company accounts for its investments in joint ventures, which it does not control, using the equity method of accounting. Under the equity method of accounting, the net equity investment of the Company is reflected on the consolidated balance sheets, and the Company's share of net income or loss from the joint ventures is included on the consolidated statements of operations. The joint venture agreements may designate different percentage allocations among investors for profits and losses, however, the Company's recognition of joint venture income or loss generally follows the joint venture's distribution priorities, which may change upon the achievement of certain investment return thresholds.

To the extent that the Company contributes assets to a joint venture, the Company's investment in joint venture is recorded at the Company's cost basis in the assets that were contributed to the joint venture. To the extent that the Company's cost basis is different than the basis reflected at the joint venture level, the basis difference is amortized over the life of the related asset and included in the Company's share of equity in net income of the joint venture. In accordance with the provisions of Statement of Position 78-9 "Accounting for Investments in Real Estate Ventures", the Company will recognize gains on the contribution of real estate to joint ventures, relating solely to the outside partner's interest, to the extent the economic substance of the transaction is a sale.

The Company serves as property manager for the joint ventures. The Company serves as the development manager for the joint ventures currently under development. The profit on development fees received from joint ventures is recognized to the extent attributable to the outside interests in the joint ventures. The Company has recognized development and management fee income earned from its joint ventures of approximately $5.0 million, $3.9 million and $2.1 million for the years ended December 31, 2002, 2001 and 2000, respectively.

Equity Offering Costs

Underwriting commissions and offering costs are reflected as a reduction of additional paid-in capital.

Treasury Stock

The Company's share repurchases are reflected as treasury stock utilizing the cost method of accounting and are presented as a reduction to consolidated stockholders' equity.

Dividends

Earnings and profits, which determine the taxability of dividends to stockholders, will differ from income reported for financial reporting purposes due to the differences for federal income tax purposes primarily in the estimated useful lives used to compute depreciation. Common dividends paid represented 98%, 100% and 100% ordinary income and 2%, 0% and 0% capital gain income for federal income tax purposes for the years ended December 31, 2002, 2001 and 2000, respectively.

Revenue Recognition

Base rental revenue 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 $51.0 million, $27.8 million and

$12.7 million for the years ended December 31, 2002, 2001 and 2000, respectively. Accrued rental income represents rental income earned in excess of rent payments received pursuant to the terms of the individual lease agreements. The Company maintains an allowance for doubtful accounts against tenant and other receivables for estimated losses resulting from the inability of its tenants to make required rent payments. The computation of this allowance is based on the tenants' payment history and current credit status. The Company also maintains an allowance against accrued rental income for future potential tenant credit losses. The credit assessment is based on the estimated accrued rental income that is recoverable over the term of the lease. The credit risk is mitigated by the high quality of the Company's tenant base, review of the tenant's risk profile prior to lease execution and continual monitoring of the Company's portfolio to identify potential problem tenants.

Recoveries from tenants consisting of amounts due from tenants for common area maintenance, real estate taxes and other recoverable costs are recognized as revenue in the period the expenses are incurred.

Development fees are recognized ratably over the period of development. Management fees are recognized as revenue as they are earned.

The estimated fair value of warrants received in conjunction with communications license agreements are recognized over the ten-year effective terms of the license agreements.

The Company recognizes gains on sales of real estate pursuant to the provisions of SFAS No. 66 "Accounting for Sales of Real Estate". The specific timing of a sale is measured against various criteria in SFAS No. 66 related to the terms of the transaction and any continuing involvement in the form of management or financial assistance associated with the property. If the sales criteria are not met, the Company defers gain recognition and accounts for the continued operations of the property by applying the finance, installment or cost recovery methods, as appropriate, until the sales criteria are met.

Interest Expense and Interest Rate Protection Agreements

Interest expense on fixed rate debt with predetermined periodic rate increases is computed using the effective interest method over the terms of the respective loans.

From time to time, the Company enters into certain interest rate protection agreements to reduce the impact of changes in interest rates on its variable rate debt or in anticipation of issuing fixed rate debt. The fair value of these agreements is reflected on the Consolidated Balance Sheets. Changes in the fair value of these agreements are recorded in the Consolidated Statements of Operations to the extent the agreements are not effective for accounting purposes.

Earnings Per Share

Basic earnings per common share ("EPS") is computed by dividing net income available to common shareholders by the weighted average number of shares of Common Stock outstanding during the year. Diluted EPS reflects the potential dilution that could occur from shares issuable through stock-based compensation including stock options, conversion of the minority interests in the Operating Partnership and conversion of the preferred stock of the Company.

Fair Value of Financial Instruments

The carrying values of cash and cash equivalents, escrows, receivables, accounts payable, accrued expenses and other assets and liabilities are reasonable estimates of their fair values because of the short maturities of these instruments. The fair value of the Company's long-term indebtedness, which is

based on the estimates of management and on rates currently quoted and rates currently prevailing for comparable loans and instruments of comparable maturities, exceeds the aggregate carrying value by approximately $172.5 million at December 31, 2002.

Income Taxes

The Company has elected to be treated as a REIT under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the "Code"), commencing with its taxable year ended December 31, 1997. As a result, the Company generally will not be subject to federal corporate income tax on its taxable income that is distributed to its stockholders. A REIT is subject to a number of organizational and operational requirements, including a requirement that it currently distribute at least 90% of its annual taxable income. The Company's policy is to distribute 100% of its taxable income. Accordingly, the only provision for federal income taxes in the accompanying consolidated financial statements relates to the Company's consolidated taxable REIT subsidiaries.

In January 2002, the Company formed a taxable REIT subsidiary ("TRS"), IXP, Inc. (IXP) which acts as a captive insurance company to provide earthquake re-insurance coverage for the Company's Greater San Francisco properties. The accounts of IXP are consolidated within the Company. The captive TRS is subject to tax at the federal and state level, and accordingly, the Company has recorded a tax provision of $0.1 million for the year ended December 31, 2002 in the Company's Consolidated Statements of Operations.

Effective July 1, 2002, the Company restructured the leases with respect to ownership of its three hotel properties by forming a TRS. The hotel TRS, a wholly owned subsidiary of the Operating Partnership, is the lessee pursuant to new leases for each of the hotel properties. As lessor, the Operating Partnership is entitled to a percentage of gross receipts from the hotel properties. Marriott International, Inc. will continue to manage the hotel properties under the Marriott® name and under terms of the existing management agreements. In connection with the restructuring, the revenue and expenses of the hotel properties are being reflected in the Company's Consolidated Statements of Operations. The hotel TRS is subject to tax at the federal and state level, and accordingly, the Company has recorded a tax provision of $0.4 million for the six months ended December 31, 2002 in the Company's Consolidated Statements of Operations.

To assist the Company in maintaining its status as a REIT, the Company had previously leased its three in-service hotel properties, pursuant to leases with a participation in the gross receipts of such hotel properties, to a lessee ("ZL Hotel LLC") in which Messrs. Zuckerman and Linde, the Chairman of the Board and Chief Executive Officer, respectively, are the sole member-managers. Marriott International, Inc. manages these hotel properties under the Marriott® name pursuant to management agreements with the lessee. Rental revenue from these leases totaled approximately $12.2 million for the six-month period in 2002 prior to the formation of the hotel TRS and $31.3 million and $38.1 million for the years ended December 31, 2001 and 2000, respectively.

The net difference between the tax basis and the reported amounts of the Company's assets and liabilities is approximately $1.7 billion and $1.2 billion as of December 31, 2002 and 2001, respectively.

Certain entities included in the Company's consolidated financial statements are subject to certain state and local taxes. These taxes are recorded as operating expenses in the accompanying consolidated financial statements.

Reclassifications

Certain prior-year balances have been reclassified in order to conform to the current-year presentation.

Use of Estimates in the Preparation of Financial Statements

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. These estimates include such items as depreciation and allowances for doubtful accounts. Actual results could differ from those estimates.

3. Real Estate

Real estate consisted of the following at December 31 (in thousands):

	2002			2001
Land	$	1,647,808		$	1,194,050
Land held for future development		215,866			182,672
Real estate held for sale, net of accumulated depreciation		224,585			—
Buildings and improvements		5,669,641			4,640,684
Tenant improvements		395,979			264,658
Furniture, fixtures and equipment		68,256			66,540
Development in process		448,576			1,109,302

Total		8,670,711			7,457,906
Less: Accumulated depreciation		(822,933	)		(719,854	)

	$	7,847,778		$	6,738,052

4. Deferred Charges

Deferred charges consisted of the following at December 31 (in thousands):

	2002			2001
Leasing costs	$	203,954		$	114,811
Financing costs		75,145			74,394

		279,099			189,205
Less: Accumulated amortization		(102,554	)		(81,632	)

	$	176,545		$	107,573

5. Investments in Unconsolidated Joint Ventures

The investments in unconsolidated joint ventures consists of the following:

Entity	Property	Location	% Ownership
One Freedom Square LLC	One Freedom Square	Reston, VA	25	%(1)
Square 407 LP	Market Square North	Washington, D.C.	50	%
The Metropolitan Square Associates LLC	Metropolitan Square	Washington, D.C.	51	%(2)
BP 140 Kendrick Street LLC	140 Kendrick Street	Needham, MA	25	%(1)
BP/CRF 265 Franklin Street Holdings LLC	265 Franklin Street	Boston, MA	35	%
Discovery Square LLC	Discovery Square	Reston, VA	50	%
BP/CRF 901 New York Avenue LLC	901 New York Avenue(3)	Washington, D.C.	25	%(1)
Two Freedom Square LLC	Two Freedom Square(3)	Reston, VA	50	%

(1): Ownership can increase based on the achievement of certain return thresholds.
(2): Joint venture is accounted for under the equity method due to participatory rights of the outside partner.
(3): Property is currently under development

The combined summarized financial information of the unconsolidated joint ventures is as follows (in thousands):

		December 31,
		2002		2001
*Balance Sheets*
Real estate and development in process, net		$	753,931	$	720,568
Other assets			59,665		40,670

	Total assets	$	813,596	$	761,238

Mortgage and construction loans payable		$	558,362	$	507,865
Other liabilities			13,436		16,497
Members' equity			241,798		236,876

	Total liabilities and members' equity	$	813,596	$	761,238

Company's share of equity		$	98,997	$	95,516
Basis differentials(1)			2,908		2,969

Carrying value of the Company's investments in unconsolidated joint ventures		$	101,905	$	98,485

(1): This amount represents the aggregate difference between the Company's historical cost basis and the basis reflected at the joint venture level, which is typically amortized over the life of the related asset. Basis differentials occur primarily upon the transfer of assets into a joint venture, which were previously owned by the Company. In addition, certain acquisition, transaction and other costs may not be reflected in the net assets at the joint venture level.

		Year Ended December 31,
		2002		2001		2000
*Statements of Operations*
Total revenue		$	94,678	$	80,813	$	42,754
Expenses
	Operating		26,534		23,024		12,479
	Interest		32,964		32,434		17,697
	Depreciation and amortization		17,058		13,557		7,802

Total expenses			76,556		69,015		37,978

Net income		$	18,122	$	11,798	$	4,776

Company's share of net income		$	7,954	$	4,186	$	1,758

6. Mortgage Notes Payable

The Company had outstanding mortgage notes payable totaling $4.3 billion as of December 31, 2002, each collateralized by one or more buildings and related land included in real estate assets. The mortgage notes payable are generally due in monthly installments and mature at various dates through August 1, 2021.

Fixed rate mortgage notes payable totaled approximately $3.1 billion and $3.4 billion at December 31, 2002 and 2001, respectively, with interest rates ranging from 6.40% to 9.65% (averaging 7.17% and 7.27% at December 31, 2002 and 2001, respectively).

Variable rate mortgage notes payable (including construction loans payable) totaled approximately $1.1 billion and $866.0 million at December 31, 2002 and 2001, respectively, with interest rates ranging from 1.25% above the London Interbank Offered Rate ("LIBOR") (LIBOR was 1.38% and 1.87% at December 31, 2002 and 2001, respectively) to 1.95% above LIBOR.

At December 31, 2002, the Company had outstanding hedge contracts totaling $150.0 million. The hedging agreements provide for a fixed interest rate when LIBOR is less than 5.76% and when LIBOR is between 6.35% and 7.45% and between 7.51% and 9.00% for remaining terms ranging from one to three years per the individual hedging agreements.

A mortgage note payable totaling approximately $115.1 million at December 31, 2001 was subject to periodic scheduled interest rate increases. Interest expense for this mortgage note payable was computed using the effective interest method. A mortgage note payable totaling approximately $69.3 million at December 31, 2002 and two mortgage notes payable totaling approximately $220.7 million at December 31, 2001, have been accounted for at their fair value on the date the mortgage loans were assumed. The impact of using these accounting methods decreased interest expense by $2.2 million, $1.7 million and $3.6 million for the years ended December 31, 2002, 2001 and 2000, respectively. The cumulative liability related to these accounting methods was $5.8 million and $7.9 million at December 31, 2002 and 2001, respectively, and is included in mortgage notes payable.

Combined aggregate principal payments of mortgage notes payable at December 31, 2002 are as follows:

	(in thousands)
2003	$	931,496
2004		411,855
2005		285,387
2006		284,458
2007		182,632
Thereafter		2,171,291

7. Unsecured Senior Notes

On December 13, 2002, the Company's Operating Partnership closed an unregistered offering 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 notes have been reflected net of discount of $2.6 million in the Consolidated Balance Sheets. The Company used the net proceeds to pay down its unsecured bridge loan incurred in connection with its September 2002 acquisition of 399 Park Avenue. In connection with the offering, the Company terminated treasury rate lock agreements at a cost of approximately $3.5 million that are being amortized over the term of the notes as an adjustment to interest expense.

The indenture relating to the unsecured senior notes contain certain financial restrictions and requirements, including (1) a leverage ratio not to exceed 60%, (2) a secured debt leverage ratio not to exceed 50%, (3) an interest coverage ratio of 1.50, and (4) an unencumbered asset value to less than 150% of unsecured debt. At December 31, 2002, the Company was in compliance with each of these financial restrictions and requirements.

8. Unsecured Bridge Loan

On September 25, 2002, the Company obtained unsecured bridge financing totaling $1.0 billion (the "Unsecured Bridge Loan") in connection with the acquisition of 399 Park Avenue. During 2002, the Company repaid approximately $894.3 million with proceeds from the offering of unsecured senior notes and proceeds from the sales of certain real estate properties. At December 31, 2002, the Unsecured Bridge Loan had an outstanding balance of approximately $105.7 million and currently bears interest at a variable rate of Eurodollar + 1.45% (2.89% for the contract in effect at December 31, 2002). The Unsecured Bridge Loan matures in September 2003 and may be prepaid at any time prior to its maturity without a prepayment penalty.

The terms of the Unsecured Bridge Loan require that the Company maintain a number of customary financial and other covenants on an ongoing basis including among other things, (1) unsecured loan-to-value ratio against total borrowing base not to exceed 55%, unless the Company's leverage ratio exceeds 60%, in which case it is not to exceed 50%, (2) a secured debt leverage ratio not to exceed 55%, (3) debt service coverage ratio of 1.40 for the Company's borrowing base, or 1.50 if the Company's leverage ratio equals or exceeds 60%, a fixed charge ratio of 1.30, and a debt service coverage ratio of 1.50 (4) a leverage ratio not to exceed 60%, however for five consecutive quarters (not including the two quarters prior to expiration) leverage can go to 65% (5) limitations on additional indebtedness and stockholder distributions, and (6) a minimum net worth requirement. At December 31, 2002, the Company was in compliance with each of these financial and other covenant requirements.

9. Unsecured Line of Credit

As of December 31, 2002, the Company had an agreement for a $605.0 million unsecured revolving credit facility (the "Unsecured Line of Credit") maturing in March 2003. Outstanding balances under the Unsecured Line of Credit currently bear interest at a floating rate based on an increase over Eurodollar from 105 to 170 basis points or an increase over the lender's prime rate from zero to 75 basis points, depending upon the Company's applicable leverage ratio. The Unsecured Line of Credit requires payments of interest only.

The Company had an outstanding balance on the Unsecured Line of Credit of $173.9 million at December 31, 2002 of which approximately $146.9 million is collateralized by the Company's 875 Third Avenue property and is included in Mortgage Notes Payable. There was no outstanding balance at December 31, 2001. The weighted-average balance outstanding was approximately $15.2 million and $11.3 million during the year ended December 31, 2002 and 2001, respectively. The weighted-average interest rate on amounts outstanding was approximately 3.03% and 5.49% during the year ended December 31, 2002 and 2001, respectively.

The terms of the Unsecured Line of Credit require that the Company maintain a number of customary financial and other covenants on an ongoing basis including among other things, (1) unsecured loan-to-value ratio against total borrowing base not to exceed 55%, unless the Company's leverage ratio exceeds 60%, in which case it is not to exceed 50%, (2) a secured debt leverage ratio not to exceed 55%, (3) debt service coverage ratio of 1.40 for the Company's borrowing base, or 1.50 if the Company's leverage ratio equals or exceeds 60%, a fixed charge ratio of 1.30, and a debt service coverage ratio of 1.50 (4) a leverage ratio not to exceed 60%, however for five consecutive quarters (not including the two quarters prior to expiration) leverage can go to 65% (5) limitations on additional indebtedness and stockholder distributions, and (6) a minimum net worth requirement. At December 31, 2002, the Company was in compliance with each of these financial and other covenant requirements.

10. Commitments and Contingencies

General

The Company has letter of credit and performance obligations of approximately $39.3 million primarily related to its wholly owned subsidiary IXP and certain other development and lender requirements.

The Company has indebtedness guarantee obligations with lenders primarily related to construction loans. At December 31, 2002, the Company had obligations outstanding totaling approximately $2.8 million in excess of its share of indebtedness related to the construction loan of a joint venture property.

The Company's joint venture agreements generally include provisions whereby each partner has the right to initiate a purchase or sale of its interest in the joint ventures. Under these provisions, the Company is not compelled to purchase the interest of its outside joint venture partners.

Concentrations of Credit Risk

Management of the Company performs ongoing credit evaluations of tenants and may require tenants to provide some form of credit support such as corporate guarantees and/or other financial guarantees. Although the Company's properties are geographically diverse and the tenants operate in a variety of industries, to the extent the Company has a significant concentration of rental revenue from any single tenant, the inability of that tenant to make its lease payments could have an adverse effect on the Company.

Insurance

The Company carries insurance coverage on its properties of types and in amounts that it believes are in line with coverage customarily obtained by owners of similar properties. The Company believes that all of its properties are adequately insured. The property insurance that the Company maintains for its properties has historically been on an "all risk" basis, which until 2002 included losses caused by acts of terrorism. Following the terrorist activity of September 11, 2001 and the resulting uncertainty in the insurance market, insurance companies generally excluded insurance against acts of terrorism from their "all risk" policies. As a result the Company's "all risk" insurance coverage currently contains specific exclusions for losses attributable to acts of terrorism. In light of this development, in 2002 the Company purchased stand-alone terrorism insurance on a portfolio-wide basis with annual aggregate limits that the Company considers commercially reasonable, considering the availability and cost of such coverage. The federal Terrorism Risk Insurance Act, enacted in November 2002, requires regulated insurers to make available coverage for certified acts of terrorism (as defined by the statute) under property insurance policies, but the Company cannot currently anticipate whether the scope and cost of such coverage will compare favorably to stand-alone terrorism insurance, and thus whether it will be commercially reasonable for the Company to change its coverage for acts of terrorism going forward. The Company will continue to monitor the state of the insurance market, but does not currently expect that coverage for acts of terrorism on terms comparable to pre-2002 policies will become available on commercially reasonable terms.

The Company carries earthquake insurance on its properties located in areas known to be subject to earthquakes in an amount and subject to deductibles and self-insurance that it believes are commercially reasonable. However, the amount of the Company's earthquake insurance coverage may not be sufficient to cover losses from earthquakes. As a result of increased costs of coverage and decreased availability, the amount of third party earthquake insurance that the Company may be able to purchase on commercially reasonable terms may be reduced. In addition, the Company may discontinue earthquake insurance on some or all of its properties in the future if the premiums exceed the Company's estimation of the value of the coverage.

In January 2002, the Company formed a wholly-owned insurance subsidiary, IXP, Inc. ("IXP"), to act as a captive insurance company and be one of the elements of its overall insurance program. IXP has acted as a reinsurer for the Company's primary carrier with respect to a portion of its earthquake insurance coverage for its Greater San Francisco properties. In the future IXP may provide additional or different coverage, as a reinsurer or a primary insurer, depending on the availability and cost of third party insurance in the marketplace and the level of self insurance that the Company believes is commercially reasonable. The accounts of IXP are consolidated within the Company.

There are other types of losses, such as from wars, acts of bio-terrorism or the presence of mold at the Company's properties, for which the Company cannot obtain insurance at all or at a reasonable cost. With respect to such losses and losses from acts of terrorism, earthquakes or other catastrophic

events, if the Company experiences a loss that is uninsured or that exceeds policy limits, the Company could lose the capital invested in the damaged properties, as well as the anticipated future revenues from those properties. Depending on the specific circumstances of each affected property, it is possible that the Company could be liable for mortgage indebtedness or other obligations related to the property. Any such loss could materially and adversely affect the Company's business and financial condition and results of operations.

Legal Matters

The Company is subject to various legal proceedings and claims that arise in the ordinary course of business. These matters are generally covered by insurance. Management believes that the final outcome of such matters will not have a material adverse effect on the financial position, results of operations or liquidity of the Company.

Environmental Matters

It is the Company's policy to retain independent environmental consultants to conduct or update Phase I environmental assessments (which generally do not involve invasive techniques such as soil or ground water sampling) and asbestos surveys with respect to its properties. These pre-purchase environmental assessments have not revealed environmental conditions that the Company believes will have a material adverse effect on its business, assets or results of operations, and the Company is not otherwise aware of environmental conditions with respect to its properties which the Company believes would have such a material adverse effect. However, from time to time pre-existing environmental conditions at its properties have required environmental testing and/or regulatory filings.

In February 1999, one of the Company's affiliates acquired from Exxon Corporation a property in Massachusetts that was formerly used as a petroleum bulk storage and distribution facility and was known by the state regulatory authority to contain soil and groundwater contamination. The Company recently completed development of an office park on the property. The Company's affiliate engaged a specially licensed environmental consultant to oversee the management of contaminated soil and groundwater that was disturbed in the course of construction. Pursuant to the property acquisition agreement, Exxon agreed to (1) bear the liability arising from releases or discharges of oil and hazardous substances which occurred at the site prior to the Company's ownership, (2) continue remediating such releases and discharges as necessary and appropriate to comply with applicable requirements, and (3) indemnify the Company's affiliate for certain losses arising from preexisting site conditions. Any indemnity claim may be subject to various defenses.

Environmental investigations at two of the Company's properties in Massachusetts have identified groundwater contamination migrating from off-site source properties. In both cases the Company engaged a specially licensed environmental consultant to perform the necessary investigations and assessments and to prepare submittals to the state regulatory authority, including Downgradient Property Status Opinions. The environmental consultant concluded that the properties qualify for Downgradient Property Status under the state regulatory program, which eliminates certain deadlines for conducting response actions at a site. The Company also believes that these properties qualify for liability relief under certain statutory amendments regarding upgradient releases. Although the Company believes that the current or former owners of the upgradient source properties may ultimately be responsible for some or all of the costs of addressing the identified groundwater contamination, the Company will take necessary further response actions (if any are required). No such additional response actions are anticipated at this time.

One of the Company's affiliates recently acquired a property in Massachusetts where historic groundwater contamination was identified prior to acquisition. The Company engaged a specially licensed environmental consultant to perform investigations and to prepare necessary submittals to the state regulatory authority. The environmental consultant has concluded that (1) certain identified groundwater contaminants are migrating to the subject property from an off-site source property and (2) certain other detected contaminants are likely related to a historic release on the subject property. The Company has filed a Downgradient Property Status Opinion (described above) with respect to contamination migrating from off-site. The consultant has recommended conducting additional investigations, including the installation of off-site monitoring wells, to determine the nature and extent of contamination potentially associated with the historic use of the subject property. The Company's affiliate has authorized such additional investigations and will take necessary further response actions (if any are required).

Some of the Company's properties and certain properties owned by the Company's affiliates are located in urban, industrial and other previously developed areas where fill or current or historical uses of the areas have caused site contamination. Accordingly, it is sometimes necessary to institute special soil and/or groundwater handling procedures in connection with construction and other property operations in order to achieve regulatory closure and ensure that contaminated materials are addressed in an appropriate manner. In these situations it is the Company's practice to investigate the nature and extent of detected contamination and estimate the costs of required response actions and special handling procedures. The Company then uses this information as part of its decision-making process with respect to the acquisition and/or development of the property. For example, the Company recently acquired a parcel in Massachusetts, formerly used as a quarry/asphalt batching facility, which the Company may develop in the future. Pre-purchase testing indicated that the site contains relatively low levels of certain contaminants. The Company has engaged a specially licensed environmental consultant to perform an environmental risk characterization and prepare all necessary regulatory submittals. The Company anticipates that additional response actions necessary to achieve regulatory closure (if any) will be performed in concert with future construction activities. When appropriate, closure documentation will be submitted for public review and comment pursuant to the state regulatory authority's public information process.

The Company expects that resolution of the environmental matters relating to the above will not have a material impact on its financial position, results of operations or liquidity.

Development

The Company has six properties currently under construction. Commitments to complete these projects totaled approximately $405.9 million at December 31, 2002. Of the remaining commitment, $371.7 million of the costs will be covered under its existing construction loans.

Sale of Property

The Operating Partnership Agreement provides that, until June 23, 2007, the Operating Partnership may not sell or otherwise transfer three designated properties (or a property acquired pursuant to the disposition of a designated property in a non-taxable transaction) in a taxable transaction without the prior written consent of Mr. Mortimer B. Zuckerman, Chairman of the Board of Directors and Mr. Edward H. Linde, President and Chief Executive Officer. The Operating Partnership is not required to obtain their consent if each of them does not continue to hold at least a specified percentage of their original OP Units. In connection with the acquisition or contribution of 31 other Properties, the Company entered into similar agreements for the benefit of the selling or contributing parties which specifically state the Operating Partnership will not sell or otherwise transfer the Properties in a taxable transaction until specified dates ranging from June 2006 to April 2016.

11. Minority Interests

Minority interests relate to the interest in the Operating Partnership not owned by the Company and interests in a property partnership not owned by the Company. As of December 31, 2002, the minority interest in the Operating Partnership consisted of 20,474,241 OP Units and 7,778,514 Preferred Units held by parties other than the Company.

On April 25, 2001, the Company acquired Citigroup Center through a venture with a private real estate investment company. This venture is consolidated with the financial results of the Company because the Company exercises control over the entity that owns the property. The equity interest in the venture that is not owned by the Company, totaling approximately $29.9 million and $34.4 million at December 31, 2002 and 2001, respectively is included in Minority Interests on the accompanying Consolidated Balance Sheets. The minority interest holder's share of income for Citigroup Center is reflective of the Company's preferential return on and of its capital.

On July 9, 2002, the Company issued 1,066,229 shares of Common Stock with a fair value of approximately $41.2 million on the date of issuance, as a result of the conversion of 812,469 Preferred Units into 1,066,229 OP Units, which OP Units were immediately acquired by Boston Properties, Inc. in exchange for an equal number of shares of Common Stock. These Preferred Units that were converted had a book value of approximately $20.8 million on the date of conversion. The difference between the effective purchase price of the minority interest and the book value was approximately $20.4 million, which increased the recorded value of the underlying real estate. In addition, the Company paid the accrued preferred distributions due to the holders of Preferred Units that were converted.

The Preferred Units at December 31, 2002 consist of 2,377,853 Series One Preferred Units of limited partnership in the Operating Partnership (the "Series One Preferred Units"), which bear a preferred distribution of 7.25% per annum on a liquidation preference of $34.00 per unit and are convertible into OP Units at a rate of $38.25 per Preferred Unit and 5,400,661 Series Two Preferred Units of limited partnership in the Operating Partnership (the "Series Two Preferred Units"), which bear a preferred distribution at the greater of the distribution rate payable to common unitholders or an increasing rate, ranging from 5.00% to 7.00% per annum on a liquidation preference of $50.00 per unit and will be convertible into OP Units after December 31, 2002 at a rate of $38.10 per Preferred Unit. Distributions to holders of Preferred Units are recognized on a straight-line basis that approximates the effective interest method.

12. Redeemable Preferred Stock and Stockholders' Equity

As of December 31, 2002 the Company had 95,362,990 shares of Common Stock and no shares of Series A Convertible Redeemable Preferred Stock (the "Preferred Stock") outstanding.

On July 9, 2002, the Company issued 2,624,671 shares of Common Stock as a result of the conversion of all of the Company's 2,000,000 shares of Preferred Stock. In addition, the Company paid the accrued preferred dividends due to the holders of the Preferred Stock.

On September 14, 2001, the Board of Directors of the Company authorized a stock repurchase program under which the Company is permitted to purchase up to $100 million of the Company's outstanding Common Stock. As of December 31, 2002 and 2001, the Company had repurchased 78,900 shares of Common Stock for an aggregate cost of approximately $2.7 million.

13. Future Minimum Rents

The Properties are leased to tenants under net operating leases with initial term expiration dates ranging from 2003 to 2029. The future minimum lease payments to be received (excluding operating expense reimbursements) by the Company as of December 31, 2002, under non-cancelable operating leases (including leases for properties under development), which expire on various dates through 2029, are as follows:

Years Ending December 31,	(in thousands)
2003	$	984,658
2004		974,375
2005		904,860
2006		819,044
2007		721,163
Thereafter		4,490,652

The geographic concentration of the future minimum lease payments to be received is detailed as follows:

Location	(in thousands)
Midtown Manhattan	$	4,846,043
Greater Washington, D.C.		1,392,608
Greater Boston		1,472,107
Greater San Francisco		880,795
New Jersey and Pennsylvania		303,199

No one tenant represented more than 10.0% of the Company's total rental revenue for the years ended December 31, 2002, 2001 and 2000.

14. Segment Reporting

The Company has determined that its reportable segments are those that are based on the Company's method of internal reporting, which classifies its operations by both geographic area and property type. The Company's reportable segments by geographic area are Greater Boston, Greater Washington, D.C., Midtown Manhattan, Greater San Francisco, and New Jersey and Pennsylvania. Segments by property type include: Class A Office, Office/Technical, Industrial and Hotel.

Asset information by reportable segment is not reported, since the Company does not use this measure to assess performance; therefore, the depreciation and amortization expenses are not allocated among segments. Development and management services revenue, interest and other revenue, general and administrative expenses, net derivative losses, losses on investments in securities and interest expense are not included in net operating income, as the internal reporting addresses these on a corporate level.

Net operating income is not a measure of operating results or cash flows from operating activities as measured by accounting principles generally accepted in the United States of America, and it is not indicative of cash available to fund cash needs and should not be considered an alternative to cash flows as a measure of liquidity. All companies may not be using the same definition for net operating income. As discussed in Note 2 and effective as of July 1, 2002, the revenue and expenses of the hotel properties have been included in the operations of the Company. The operations of the hotel properties were reflected in the periods prior to July 1, 2002 as a net lease payment in rental revenue and real estate tax expense in property operating expenses.

Information by Geographic Area and Property Type:

For the year ended December 31, 2002:

			Greater Boston			Greater Washington, D.C.			Midtown Manhattan			Greater San Francisco			New Jersey and Pennsylvania			Total
Rental Revenue:
	Class A Office		$	266,930		$	228,997		$	351,374		$	220,153		$	66,725		$	1,134,179
	Office/Technical			8,230			14,334			—			1,899			—			24,463
	Industrial			1,019			—			—			659			762			2,440
	Hotels			57,489			—			—			—			—			57,489

		Total		333,668			243,331			351,374			222,711			67,487			1,218,571
% of Grand Totals				27.38	%		19.97	%		28.83	%		18.28	%		5.54	%		100.00	%
Rental Expenses:
	Class A Office			99,653			64,863			110,093			77,222			25,072			376,903
	Office/Technical			1,787			2,686			—			387			—			4,860
	Industrial			332			—			—			70			139			541
	Hotels			34,273			—			—			—			—			34,273

		Total		136,045			67,549			110,093			77,679			25,211			416,577
% of Grand Totals				32.66	%		16.22	%		26.43	%		18.64	%		6.05	%		100.00	%

Net operating income			$	197,623		$	175,782		$	241,281		$	145,032		$	42,276		$	801,994

% of Grand Totals				24.64	%		21.92	%		30.09	%		18.08	%		5.27	%		100.00	%

For the year ended December 31, 2001:

			Greater Boston			Greater Washington, D.C.			Midtown Manhattan			Greater San Francisco			New Jersey and Pennsylvania			Total
Rental Revenue:
	Class A Office		$	226,573		$	227,022		$	229,082		$	213,950		$	65,689		$	962,316
	Office/Technical			7,837			14,445			—			2,022			—			24,304
	Industrial			1,199			677			—			620			724			3,220
	Hotels			32,330			—			—			—			—			32,330

		Total		267,939			242,144			229,082			216,592			66,413			1,022,170
% of Grand Totals				26.21	%		23.69	%		22.41	%		21.19	%		6.50	%		100.00	%
Rental Expenses:
	Class A Office			82,919			61,321			75,929			74,930			23,825			318,924
	Office/Technical			1,871			2,495			—			357			—			4,723
	Industrial			425			260			—			66			122			873
	Hotels			5,781			—			—			—			—			5,781

		Total		90,996			64,076			75,929			75,353			23,947			330,301
% of Grand Totals				27.55	%		19.40	%		22.99	%		22.81	%		7.25	%		100.00	%

Net operating income			$	176,943		$	178,068		$	153,153		$	141,239		$	42,466		$	691,869

% of Grand Totals				25.57	%		25.74	%		22.14	%		20.41	%		6.14	%		100.00	%

For the year ended December 31, 2000:

			Greater Boston			Greater Washington, D.C.			Midtown Manhattan			Greater San Francisco			New Jersey and Pennsylvania			Total
Rental Revenue:
	Class A Office		$	195,300		$	215,452		$	145,114		$	183,367		$	63,272		$	802,505
	Office/Technical			5,912			15,696			—			1,851			—			23,459
	Industrial			1,921			1,348			—			586			714			4,569
	Hotels			38,703			—			—			—			—			38,703

		Total		241,836			232,496			145,114			185,804			63,986			869,236
% of Grand Totals				27.82	%		26.75	%		16.69	%		21.38	%		7.36	%		100.00	%
Rental Expenses:
	Class A Office			72,104			59,018			51,251			63,650			22,085			268,108
	Office/Technical			2,315			3,040			—			334			—			5,689
	Industrial			553			452			—			58			117			1,180
	Hotels			4,694			—			—			—			—			4,694

		Total		79,666			62,510			51,251			64,042			22,202			279,671
% of Grand Totals				28.48	%		22.35	%		18.33	%		22.90	%		7.94	%		100.00	%

Net operating income			$	162,170		$	169,986		$	93,863		$	121,762		$	41,784		$	589,565

% of Grand Totals				27.51	%		28.83	%		15.92	%		20.65	%		7.09	%		100.00	%

The following is a reconciliation of net operating income to income before minority interests in property partnerships, income from unconsolidated joint ventures, minority interest in Operating Partnership, gains (losses) 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:

		2002		2001		2000
Net operating income		$	801,994	$	691,869	$	589,565
Add:
	Development and management services		10,748		12,167		11,837
	Interest and other		5,504		12,183		8,558
Less:
	General and administrative		47,292		38,312		35,659
	Interest expense		271,685		223,389		217,064
	Depreciation and amortization		186,177		149,181		132,223
	Net derivative losses		11,874		26,488		—
	Losses on investments in securities		4,297		6,500		—

Income before minority interests in property partnerships, income from unconsolidated joint ventures, minority interest in Operating Partnership, gains (losses) 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		$	296,921	$	272,349	$	225,014

15. Extraordinary Items

The Company incurred extraordinary losses of $2.0 million and $0.3 million (net of minority interest share of $0.4 million and $0.1 million), respectively for the years ended December 31, 2002 and 2000 due to the payment of a prepayment fee and the write-off of unamortized deferred financing costs related to the early extinguishment of certain mortgage notes payable.

16. Earnings Per Share

Earnings per common share ("EPS") has been computed pursuant to the provisions of SFAS No. 128. The following table provides a reconciliation of both net income and the number of common shares used in the computation of basic EPS, which utilizes the weighted average number of common shares outstanding without regard to the dilutive potential common shares, and diluted EPS, which includes all shares, as applicable.

		For the year ended December 31, 2002
		Income (Numerator)		Shares (Denominator)	Per Share Amount
Basic Earnings Per Share:
	Income available to common shareholders	$	440,971	93,145	$	4.73
Effect of Dilutive Securities:
	Stock Options and other		155	1,467		(.07	)

Diluted Earnings Per Share:
	Income available to common shareholders	$	441,126	94,612	$	4.66

		For the year ended December 31, 2001
		Income (Numerator)		Shares (Denominator)	Per Share Amount
Basic Earnings Per Share:
	Income available to common shareholders	$	201,440	90,002	$	2.24
Effect of Dilutive Securities:
	Stock Options and other		244	2,198		(.05	)

Diluted Earnings Per Share:
	Income available to common shareholders	$	201,684	92,200	$	2.19

		For the year ended December 31, 2000
		Income (Numerator)		Shares (Denominator)	Per Share Amount
Basic Earnings Per Share:
	Income available to common shareholders	$	146,426	71,424	$	2.05
Effect of Dilutive Securities:
	Stock Options		—	1,317		(.04	)

Diluted Earnings Per Share:
	Income available to common shareholders	$	146,426	72,741	$	2.01

17. Employee Benefit Plan

Effective January 1, 1985, the predecessor of the Company adopted a 401(k) Savings Plan (the "Plan") for its employees. Under the Plan, as amended, employees as defined, are eligible to participate in the Plan after they have completed three months of service. Upon formation, the Company adopted the Plan and the terms of the Plan.

Effective January 1, 2000, the Company amended the Plan by increasing the Company's matching contribution to 200% of the first 3% from 200% of the first 2% of participant's eligible earnings contributed (utilizing earnings that are not in excess of $200,000, indexed for inflation) and by eliminating the vesting requirement.

The Plan provides that matching employer contributions are to be determined at the discretion of the Company. The Company's matching contribution for the years ended December 31, 2002, 2001 and 2000 was $2.0 million, $1.8 million and $1.7 million, respectively.

18. Stock Option and Incentive Plan and Stock Purchase Plan

The Company has established a stock option and incentive plan for the purpose of attracting and retaining qualified executives and rewarding them for superior performance in achieving the Company's business goals and enhancing stockholder value.

Under the plan, the number of shares of Common Stock available for issuance is 14,699,162 shares plus as of the first day of each calendar quarter after January 1, 2000, 9.5% of any net increase since the first day of the preceding calendar quarter in the total number of shares of Common Stock outstanding, on a fully converted basis (excluding Preferred Stock). At December 31, 2002, the number of shares available for issuance under the plan was 3,192,911.

Options granted under the plan become exercisable over a two, three or five year period and have terms of ten years. All options were granted at the fair market value of the Company's Common Stock at the dates of grant.

The Company issued 52,750, 44,842 and 34,822 shares of restricted stock under the plan during the years ended December 31, 2002, 2001 and 2000, respectively. The shares of restricted stock were valued at approximately $2.0 million ($37.70 per share), $1.8 million ($40.75 per share) and $1.1 million ($30.4375 per share) for the years ended December 31, 2002, 2001 and 2000, respectively. The restricted stock vests over a five-year period, with one-fifth of the shares vesting each year and has been recognized net of amortization as unearned compensation on the consolidated balance sheets. Compensation expense related to the restricted stock totaled $1.2 million, $0.6 million and $0.2 million for the years ended December 31, 2002, 2001 and 2000, respectively.

A summary of the status of the Company's stock options as of December 31, 2002, 2001 and 2000 and changes during the years ended December 31, 2002, 2001 and 2000 are presented below:

	Shares		Weighted Average Exercise Price
Outstanding at January 1, 2000	7,555,458		$	31.20
Granted	1,072,750		$	30.60
Exercised	(511,281	)	$	30.59
Canceled	(15,245	)	$	33.20

Outstanding at December 31, 2000	8,101,682		$	31.15
Granted	3,247,250		$	41.60
Exercised	(406,371	)	$	30.40
Canceled	(35,003	)	$	33.60

Outstanding at December 31, 2001	10,907,558		$	34.28
Granted	1,423,000		$	37.73
Exercised	(329,704	)	$	30.28
Canceled	(38,509	)	$	37.13

Outstanding at December 31, 2002	11,962,345		$	34.80

The per share weighted-average fair value of options granted was $3.31, $5.01 and $3.79 for the years ended December 31, 2002, 2001 and 2000, respectively. The per share fair value of each option granted is estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions for grants in 2002, 2001 and 2000.

	2002		2001		2000
Dividend yield	6.47	%	5.72	%	6.90	%
Expected life of option	6 Years		6 Years		6 Years
Risk-free interest rate	3.32	%	5.13	%	6.51	%
Expected stock price volatility	20	%	20	%	20	%

The following table summarizes information about stock options outstanding at December 31, 2002:

Options Outstanding					Options Exercisable
Range of Exercise Prices	Number Outstanding at 12/31/02	Weighted- Average Remaining Contractual Life	Weighted- Average Exercise Price		Number Exercisable at 12/31/02	Weighted- Average Exercise Price
$25.00 - $36.81	7,313,845	5.46 Years	$	31.23	6,672,512	$	31.14
$37.70 - $42.12	4,648,500	7.95 Years	$	40.41	1,876,592	$	41.59

In addition, the Company had 4,999,346 and 3,397,714 options exercisable at weighted-average exercise prices of $31.37 and $32.11 at December 31, 2002 and 2001, respectively.

The Company adopted the 1999 Non-Qualified Employee Stock Purchase Plan (the "Stock Purchase Plan") to encourage the ownership of Common Stock by eligible employees. The Stock Purchase Plan became effective on January 1, 1999 with an aggregate maximum of 250,000 shares of Common Stock available for issuance. The Stock Purchase Plan provides for eligible employees to

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purchase at the end of the biannual purchase periods shares of Common Stock for 85% of the average closing price during the last ten business days of the purchase period. The Company issued 8,595, 8,538 and 11,105 shares with the weighted average fair value of the purchase right equal to $33.09 per share, $36.02 per share and $28.15 per share under the Stock Purchase Plan as of December 31, 2002, 2001 and 2000, respectively.

The Company applies Accounting Practice Bulletin No. 25 and related interpretations in accounting for its stock option and stock purchase plans. Accordingly, no compensation cost has been recognized.

The compensation cost under SFAS No. 123 for the stock performance-based plans would have been $9.4 million, $11.7 million and $12.0 million for the years ended December 31, 2002, 2001 and 2000, respectively. Had compensation cost for the Company's grants for stock-based compensation plans been determined consistent with SFAS No. 123, the Company's net income available to common shareholders, and net income per common share for 2002, 2001 and 2000 would approximate the pro forma amounts below:

	2002		2001		2000
Net income available to common shareholders	$	433,274	$	191,973	$	137,425
Net income per common share—basic	$	4.65	$	2.13	$	1.92
Net income per common share—diluted	$	4.58	$	2.08	$	1.89

The effects of applying SFAS No. 123 in this pro forma disclosure are not indicative of future amounts. SFAS No. 123 does not apply to future anticipated awards.

19. Selected Interim Financial Information (unaudited)

The tables below reflect the Company's selected quarterly information for the years ended December 31, 2002 and 2001. Certain 2002 and 2001 amounts have been reclassified to conform to the current presentation of discontinued operations.

	2002 Quarter Ended
	March 31,		June 30,		September 30,		December 31,
Total revenue	$	274,128	$	289,771	$	307,770	$	363,154
Income before minority interest in Operating Partnership		68,848		75,823		74,626		87,643
Income available to common shareholders before extraordinary items		55,365		54,775		71,541		262,110
Net income available to common shareholders		55,365		54,775		71,541		260,146
Income available to common shareholders before extraordinary items per share—basic		.61		.60		.75		2.75
Income available to common shareholders before extraordinary items per share—diluted		.60		.59		.74		2.72

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	2001 Quarter Ended
	March 31,		June 30,		September 30,		December 31,
Total revenue	$	235,879	$	258,839	$	281,736	$	270,016
Income before minority interest in Operating Partnership		67,477		66,098		71,299		72,746
Income available to common shareholders before extraordinary items and cumulative effect of a change in accounting principle		52,374		49,038		51,515		55,280
Net income available to common shareholders		45,607		49,038		51,515		55,280
Income available to common shareholders before extraordinary items and cumulative effect of a change in accounting principle per share—basic		.59		.54		.57		.61
Income available to common shareholders before extraordinary items and cumulative effect of a change in accounting principle per share—diluted		.57		.53		.55		.60

20. Pro Forma Financial Information (unaudited)

The accompanying unaudited pro forma information for the years ended December 31, 2002 and 2001 is presented as if the acquisitions of Citigroup Center on April 25, 2001 and 399 Park Avenue on September 25, 2002 had occurred on January 1, 2001 and all leases in effect on April 25, 2001 and September 25, 2002 were in place on January 1, 2001. This pro forma information is based upon the historical consolidated financial statements and should be read in conjunction with the consolidated financial statements and notes thereto.

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This unaudited pro forma information does not purport to represent what the actual results of operations of the Company would have been had the above occurred, nor do they purport to predict the results of operations of future periods.

	Year Ended December 31,
	2002		2001
	(in thousands, except per share data)
Pro Forma
Total revenue	$	1,325,974	$	1,200,597
Income available to common shareholders before gains on sales of real estate, discontinued operations, extraordinary items and cumulative effect of a change in accounting principle	$	249,692	$	234,369
Net income available to common shareholders	$	464,659	$	239,520
Basic earnings per share:
Income available to common shareholders before gains on sales of real estate, discontinued operations, extraordinary items and cumulative effect of a change in accounting principle	$	2.68	$	2.60
Net income available to common shareholders	$	4.99	$	2.66
Weighted average number of common shares outstanding		93,145		90,002
Diluted earnings per share:
Income available to common shareholders before gains on sales of real estate, discontinued operations, extraordinary items and cumulative effect of a change in accounting principle	$	2.64	$	2.54
Net income available to common shareholders	$	4.91	$	2.60
Weighted average number of common and common equivalent shares outstanding		94,612		92,200

21. Derivative Instruments and Hedging Activities

The Company adopted SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities" as amended by SFAS No. 137 and SFAS No. 138 ("SFAS No. 133"), as of January 1, 2001. SFAS No. 133 establishes accounting and reporting standards for derivative instruments, including certain derivative instruments embedded in other contracts, and hedging activities. It requires the recognition of all derivative instruments as assets or liabilities in the Company's consolidated balance sheets at fair value. Changes in the fair value of derivative instruments that are not designated as hedges or that do not meet the hedge accounting criteria of SFAS No. 133 are recognized in earnings. For derivatives designated as hedging instruments in qualifying cash flow hedges, the effective portion of changes in fair value of the derivatives are recognized in accumulated other comprehensive income (loss) until the forecasted transactions occur and the ineffective portions are recognized in earnings.

On the date that the Company enters into a derivative contract, it designates the derivative as (1) a hedge of the variability of cash flows that are to be received or paid in connection with a recognized liability (a "cash flow" hedge), or (2) an instrument that is held for non-hedging purposes (a "non-hedging" instrument). Changes in the fair value of a derivative that is highly effective as—and

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that is designated and qualifies as—a cash flow hedge, to the extent that the hedge is effective, are recorded in other comprehensive income, until earnings are affected by the hedged transaction (i.e. until periodic settlements of a variable-rate liability are recorded in earnings). Any hedge ineffectiveness (which represents the amount by which the changes in the fair value of the derivative exceed the variability in the cash flows of the forecasted transaction) is recorded in current-period earnings. Changes in the fair value of non-hedging instruments are reported in current-period earnings.

The Company occasionally executes a financial instrument in which a derivative instrument is "embedded." Upon executing the financial instrument, the Company assesses whether the economic characteristics of the embedded derivative are clearly and closely related to the economic characteristics of the remaining component of the financial instrument (i.e., the host contract) and whether a separate, non-embedded instrument with the same terms as the embedded instrument would meet the definition of a derivative instrument. When it is determined that (1) the embedded derivative possesses economic characteristics that are not clearly and closely related to the economic characteristics of the host contract and (2) a separate, stand-alone instrument with the same terms would qualify as a derivative instrument, the embedded derivative is separated from the host contract, carried at fair value, and designated as either (1) a fair-value or cash flow hedge or (2) a trading or non-hedging derivative instrument. However, if the entire contract were to be measured at fair value, with changes in fair value reported in current earnings, or if the Company could not reliably identify and measure the embedded derivative for purposes of separating that derivative from its host contract, the entire contract would be carried on the balance sheet at fair value and not be designated as a hedging instrument. Pursuant to SFAS No. 137, the Company has selected January 1, 1999 as the transition date for embedded derivatives.

The Company formally documents all relationships between hedging instruments and hedged items, as well as its risk-management objective and strategy for undertaking various hedge transactions. This process includes linking all derivatives that are designated as cash flow hedges to (1) specific assets and liabilities on the balance sheet or (2) forecasted transactions. The Company also assesses and documents, both at the hedging instrument's inception and on an ongoing basis, whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in cash flows associated with the hedged items. When it is determined that a derivative is not (or has ceased to be) highly effective as a hedge, the Company discontinues hedge accounting prospectively, as discussed below.

The Company discontinues hedge accounting prospectively when (1) it determines that the derivative is no longer effective in offsetting changes in the cash flows of a hedged item; (2) the derivative expires or is sold, terminated, or exercised; (3) it is no longer probable that the forecasted transaction will occur; or (4) management determines that designating the derivative as a hedging instrument is no longer appropriate.

When the Company discontinues hedge accounting because it is no longer probable that the forecasted transaction will occur in the originally expected period, the gain or loss on the derivative remains in accumulated other comprehensive income and is reclassified into earnings when the forecasted transaction affects earnings. However, if it is probable that a forecasted transaction will not occur by the end of the originally specified time period or within an additional two-month period of time thereafter, the gains and losses that were accumulated in other comprehensive income will be recognized immediately in earnings. In all situations in which hedge accounting is discontinued and the derivative remains outstanding, the Company will carry the derivative at its fair value on the balance sheet, recognizing changes in the fair value in current-period earnings.

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The Company entered into interest rate protection agreements during 2000, generally for the purpose of fixing interest rates on variable rate construction loans in order to reduce the budgeted interest costs on the Company's development projects, which would translate into higher returns on investment as the development projects come on-line. These interest rate protection agreements expire at varying dates through February 2005. Other derivatives are not linked to specific assets or liabilities but are used by the Company to manage risk of the overall portfolio. Amounts included in accumulated other comprehensive income related to the effective portion of cash flow hedges will be reclassified into earnings over the estimated life of the constructed asset.

Upon adoption of SFAS No. 133 on January 1, 2001, the Company recorded an asset of approximately $0.2 million (included in prepaid expenses and other assets) and recorded a liability of approximately $11.4 million for the fair values of these agreements. The offset for these entries was to a cumulative effect of a change in accounting principle and accumulated other comprehensive loss, respectively. Finally, the Company wrote-off deferred charges of approximately $1.6 million as a cumulative effect of a change in accounting principle.

The Company's derivatives also include investments in warrants to purchase shares of common stock of other companies. Based on the terms of the warrant agreements, the warrants meet the definition of a derivative and accordingly must be marked to fair value through earnings. The Company had been recording the warrants at fair value through accumulated other comprehensive loss as available-for-sale securities under SFAS No. 115. Upon adoption of SFAS No. 133 on January 1, 2001, the Company reclassified approximately $6.9 million, the fair value of the warrants, from accumulated other comprehensive loss to a cumulative effect of a change in accounting principle.

During 2001, the Company paid the fair value of the swap arrangement and two hedge contracts that were entered into during 2000 and part of 2001 in order to terminate the contracts. In addition, for the year ended December 31, 2001, the Company recorded unrealized derivative losses through other comprehensive income of approximately $2.5 million, related to the effective portion of interest rate agreements. The Company expects that within the next twelve months it will reclassify into earnings approximately $347,000 of the amount recorded in accumulated other comprehensive loss relating to these agreements.

During 2002, the Company entered into treasury rate lock contracts designated and qualifying as a cash flow hedge to reduce its exposure to variability in future cash flows attributable to changes in the Treasury rate relating to a forecasted fixed rate financing. All components of the treasury rate lock agreements were included in the assessment of hedge effectiveness. The amount of hedge ineffectiveness was not material. The Company terminated these contracts upon the issuance of the fixed rate debt, and paid approximately $3.5 million, which is reflected in other comprehensive income. The loss reflected in accumulated other comprehensive loss will be reclassified into earnings over the term of the fixed rate debt. The Company expects that within the next twelve months it will reclassify into earnings approximately $351,000 of the amount recorded in accumulated other comprehensive loss relating to these agreements.

For the year ended December 31, 2002 and 2001, the Company recorded net derivative losses of approximately $11.9 million and $26.5 million through earnings, which represented the total ineffectiveness of all cash flow hedges and other non-hedging instruments, the changes in value of the embedded derivatives and the change in value of the warrants. All components of each derivative's gain or loss were included in the assessment of hedge effectiveness, except for the time value of option contracts.

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22. Discontinued Operations and Sales of Real Estate

In October 2001, the Financial Accounting Standards Board (the "FASB") issued Statement of Financial Accounting Standards ("SFAS") No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets." SFAS No. 144 supersedes FASB SFAS No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of" and the accounting and reporting provisions for disposals of a segment of a business as addressed in APB Opinion No. 30, "Reporting the Results of Operations—Reporting the Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and Infrequently Occurring Events and Transactions". SFAS No. 144 establishes a single accounting model for long-lived assets to be disposed of by sale and addresses various implementation issues of SFAS No. 121. In addition, SFAS No. 144 extends the reporting requirements of discontinued operations to include components of an entity that have either been disposed of or are classified as held for sale. The Company adopted SFAS No. 144 as of January 1, 2002.

During 2002, the Company disposed of five office/technical properties totaling 347,680 net rentable square feet in Springfield, Virginia, one industrial property totaling 220,213 net rentable square feet in Hayward, California and two Class A office properties totaling 917,459 net rentable square feet in Washington, DC. Due to the Company's continuing involvement in the management of the two Washington, DC properties through an agreement with the buyer, these properties are not categorized as discontinued operations in the accompanying consolidated statements of operations. As a result, the gain on sale related to the two Washington, DC properties, totaling approximately $186.8 million (net of minority interest share of approximately $41.1 million), has been reflected under the caption—gains (losses) on sales of real estate, in the consolidated statements of operations.

At December 31, 2002, the Company had one Class A office property totaling approximately 711,901 net rentable square feet in Midtown Manhattan, NY designated as held for sale. The Company has ceased depreciation of this property, however, due to the Company's anticipated continuing involvement in the management of the property after the sale, the Company has not categorized this property as discontinued operations in the accompanying consolidated statements of operations.

The Company's adoption of SFAS No. 144 resulted in the presentation of the net operating results of these qualifying properties sold during 2002, as income from discontinued operations for all periods presented. In addition, SFAS No. 144 resulted in the gains on sale of these qualifying properties totaling approximately $25.3 million (net of minority interest share of approximately $5.6 million) to be reflected as gains on sales of real estate from discontinued operations in the accompanying consolidated statements of operations. The adoption of SFAS No. 144 did not have an impact on net income available to common shareholders. SFAS No. 144 only impacted the presentation of these properties within the consolidated statements of operations.

23. Newly Issued Accounting Standards

In June 2001, the FASB issued SFAS No. 141, "Business Combinations", and SFAS No. 142, "Goodwill and Other Intangible Assets". The provisions of SFAS No. 141 apply to all business combinations initiated after June 30, 2001. SFAS No. 142 becomes effective beginning January 1, 2002. The Company adopted both these pronouncements for the year ended December 31, 2002 and neither had a material impact on its results of operations, financial position or liquidity.

In August 2001, the FASB issued SFAS No. 143, "Accounting for Asset Retirement Obligations". SFAS No. 143 requires an entity to record a liability for an obligation associated with the retirement of an asset at the time the liability is incurred by capitalizing the cost as part of the carrying value of the related asset and depreciating it over the remaining useful life of that asset. The standard is effective

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beginning January 1, 2003. The changes required by SFAS No. 143 are not expected to have a material impact on the Company's results of operations, financial position or liquidity.

In October 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets," which addresses how and when to measure impairment on long-lived assets and how to account for long-lived assets that an entity plans to dispose of either through sale, abandonment, exchange, or distribution to owners. The Company adopted SFAS No. 144 as of January 1, 2002. See Note 22 for a discussion of the impact on the Company from the adoption of SFAS No. 144.

In April 2002, the FASB issued SFAS No. 145, "Rescission of FASB Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical Corrections" which updates, clarifies, and simplifies certain existing accounting pronouncements beginning at various dates in 2002 and 2003. The statement rescinds SFAS No. 4 and SFAS No. 64, which required net gains or losses from the extinguishment of debt to be classified as an extraordinary item in the income statement. The Company anticipates that these gains and losses will no longer be classified as extraordinary items as they are not unusual and infrequent in nature. The changes required by SFAS No. 145 are not expected to have a material impact on the Company's results of operations, financial position or liquidity.

In July 2002, the FASB issued SFAS No. 146, "Accounting for Costs Associated with Exit or Disposal Activities," which becomes effective beginning January 1, 2003. This statement requires a cost associated with an exit or disposal activity, such as the sale or termination of a line of business, the closure of business activities in a particular location, or a change in management structure, to be recorded as a liability at fair value when it becomes probable the cost will be incurred and no future economic benefit will be gained by the Company for such termination costs, and costs to consolidate facilities or relocate employees. SFAS No. 146 supersedes Emerging Issues Task Force Issue No. 94-3, "Liability Recognition for Certain Employee Termination Benefits and Other Costs to Exit an Activity," which in some cases required certain costs to be recognized before a liability was actually incurred. The adoption of this standard is not expected to have a material impact on the Company's results of operations, financial position or liquidity.

In December 2002, the FASB issued SFAS No. 148, "Accounting for Stock-Based Compensation—Transition and Disclosure," which provides guidance on how to transition from the intrinsic value method of accounting for stock-based employee compensation under APB No. 25 to SFAS No. 123's fair value method of accounting, if a company so elects. The adoption of this standard is not expected to have a material impact on the Company's results of operations, financial position or liquidity.

In November 2002, the FASB issued FASB Interpretation No. 45 (FIN No. 45), "Guarantor's Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others." This interpretation expands the disclosures to be made by a guarantor in its financial statements about its obligations under certain guarantees and requires the guarantor to recognize a liability for the fair value of an obligation assumed under a guarantee. FIN No. 45 clarifies the requirements of SFAS No. 5, Accounting for Contingencies, relating to guarantees. In general, FIN No. 45 applies to contracts or indemnification agreements that contingently require the guarantor to make payments to the guaranteed party based on changes in an underlying that is related to an asset, liability, or equity security of the guaranteed party. The disclosure requirements of FIN No. 45 are effective to the Company as of December 31, 2002, and require disclosure of the nature of the guarantee, the maximum potential amount of future payments that the guarantor could be required to make under the guarantee, and the current amount of the liability, if any, for the guarantor's obligations under the guarantee. The recognition requirements of FIN No. 45 are to be applied

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prospectively to guarantees issued or modified after December 31, 2002. The Company does not expect the requirements of FIN No. 45 to have a material impact on results of operations, financial position or liquidity.

In January 2003, the FASB issued FASB Interpretation No. 46 (FIN No. 46), "Consolidation of Variable Interest Entities." The objective of this interpretation is to provide guidance on how to identify a variable interest entity ("VIE") and determine when the assets, liabilities, non-controlling interests, and results of operations of a VIE need to be included in a company's consolidated financial statements. A company that holds variable interests in an entity will need to consolidate the entity if the company's interest in the VIE is such that the company will absorb a majority of the VIE's expected losses and/or receive a majority of the entity's expected residual returns, if they occur. FIN No. 46 also requires additional disclosures by primary beneficiaries and other significant variable interest holders. The provisions of this interpretation became effective upon issuance. The Company does not believe the adoption of this interpretation will have a material impact on results of operations, financial position or liquidity.

24. Related Party Transactions

The Company paid a printing company affiliated with Mr. Mortimer B. Zuckerman, Chairman of the Company's Board of Directors, approximately $76,000, $73,000 and $86,000 during the years ended December 31, 2002, 2001 and 2000, respectively, for printing services principally relating to the printing of the Company's annual report to shareholders. The selection of this company as the printer for the Company's annual report to shareholders was made through a bidding process open to multiple printing companies.

The Company paid aggregate leasing commissions of approximately $591,000, $571,000 and $734,000 during the years ended December 31, 2002, 2001 and 2000, respectively, to a firm controlled by Mr. Raymond A. Ritchey's brother. Mr. Ritchey is an Executive Vice President at the Company. Substantially all of these payments were made by two joint ventures in which the Company has a 50% interest. The terms of the related agreement are at least as favorable to the Company as arrangements with other brokers in comparable markets.

Mr. Martin Turchin, a director of the Company, is a non-executive/non-director Vice Chairman of Insignia. Through an arrangement with Insignia that has been in place since 1985, Turchin & Associates, an affiliate of Mr. Turchin, participates in brokerage activities for which Insignia is retained as leasing agent, some of which involve leases for space within buildings owned by the Company. For the years ended December 31, 2002, 2001 and 2000, Turchin & Associates has advised the Company that it has received approximately $116,000, $943,000 and $437,000, respectively, from Insignia attributable to properties owned by the Company. Of this amount, $0.7 million is in conjunction with funds that the Company owed to Insignia related to the acquisition of 280 Park Avenue. The total amount that was paid to Turchin & Associates, excluding amounts paid related to obligations assumed in connection with the acquisition of 280 Park Avenue, represents approximately 4.83% of the total amount paid to Insignia by the Company since the date Mr. Turchin became a director of the Company in 1997. Pursuant to its arrangement with Insignia, Turchin & Associates has confirmed to the Company that it is paid on the same basis with respect to properties owned by the Company as it is with respect to properties owned by other clients of Insignia. Mr. Turchin does not participate in any discussions or other activities relating to the Company's contractual arrangements with Insignia either in his capacity as a member of the Company's Board of Directors or as a Vice Chairman of Insignia.

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25. Subsequent Events

On January 17, 2003, the Company's Operating Partnership closed an unregistered offering 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%. The Company used the net proceeds to repay the remaining balance of its unsecured bridge loan totaling approximately $105.7 million and to repay certain construction loans maturing in 2003 totaling approximately $60.0 million.

On January 17, 2003, the Company extended its $605.0 million Unsecured Line of Credit for a three year term expiring on January 17, 2006 with a provision for a one year extension. The interest rate on borrowings has been reduced from Eurodollar + 1.45% to Eurodollar + 0.70%, subject to adjustment in the event of a change in the Operating Partnership's unsecured debt ratings.

On January 28, 2003, the Company closed on 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 Company used the net proceeds to repay certain construction loans totaling approximately $60.9 million.

On February 4, 2003, the Company closed on the sale of 875 Third Avenue, a Class A office property totaling approximately 711,901 square feet in Midtown Manhattan, for $370.1 million. The Company used the net proceeds to repay the mortgage debt on the property totaling $146.9 million and to repay the construction loan on the Company's 111 Huntington Avenue property totaling $203.0 million.

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Boston Properties, Inc.

Schedule 3—Real Estate and Accumulated Depreciation

December 31, 2002

(dollars in thousands)

									Costs Capitalized Subsequent to Acquisition
					Original												Development and Construction in Progress
Property Name					Original						Land and Improvements		Building and Improvements		Land Held for Development						Accumulated Depreciation		Year(s) Built/ Renovated	Depreciable Lives (Years)
Property Name	Type	Location	Encumbrances		Land		Building				Land and Improvements		Building and Improvements		Land Held for Development				Total		Accumulated Depreciation		Year(s) Built/ Renovated	Depreciable Lives (Years)
Embarcadero Center	Office	San Francisco, CA	$	691,027	$	211,297	$	996,442	$	96,103	$	213,968	$	1,089,874	$	—	$	—	$	1,303,842	$	114,389	1924/1989	(1	)
399 Park Avenue	Office	New York, NY		—		339,200		700,358		—		339,200		700,358		—		—		1,039,558		4,668	1961	(1	)
Prudential Center	Office	Boston, MA		508,106		90,168		712,546		159,371		91,516		809,233		39,890		21,446		962,085		67,889	1965/1993/2002	(1	)
Citigroup Center	Office	New York, NY		516,679		241,600		494,782		2,664		241,600		497,446		—		—		739,046		20,806	1977/1997	(1	)
Carnegie Center	Office	Princeton, NJ		150,503		101,772		349,089		23,769		110,086		364,544		—		—		474,630		37,407	1983-1999	(1	)
Five Times Square	Office	New York, NY		372,905		158,530		288,589		—		158,530		288,589		—		—		447,119		6,974	2002	(1	)
280 Park Avenue	Office	New York, NY		265,194		125,288		201,115		41,208		126,361		241,250		—		—		367,611		35,312	1968/95-96	(1	)
599 Lexington Avenue	Office	New York, NY		225,000		81,040		100,507		80,710		81,734		180,523		—		—		262,257		89,274	1986	(1	)
875 Third Avenue	Held for Sale	New York, NY		146,902		74,880		139,151		28,796		74,880		167,947		—		—		242,827		18,242	1982	(1	)
Riverfront Plaza	Office	Richmond, VA		110,910		18,000		156,733		3,781		18,430		160,084		—		—		178,514		19,991	1990	(1	)
Gateway Center	Office	San Francisco, CA		88,485		28,255		139,245		7,116		29,278		145,338		—		—		174,616		8,365	1984/1986/2002	(1	)
100 East Pratt Street	Office	Baltimore, MD		88,652		27,562		109,662		4,698		27,798		114,124		—		—		141,922		15,519	1975/1991	(1	)
Reservoir Place	Office	Waltham, MA		69,264		18,207		88,018		12,132		18,363		99,994		—		—		118,357		11,066	1955/1987	(1	)
Democracy Center	Office	Bethesda, MD		104,298		12,550		50,015		32,085		13,727		80,923		—		—		94,650		34,679	1985-88/94-96	(1	)
One and Two Reston Overlook	Office	Reston, VA		66,726		16,456		66,192		1,234		16,597		67,285		—		—		83,882		6,343	1999	(1	)
NIMA Building	Office	Reston, VA		20,626		10,567		67,431		1,112		10,658		68,452		—		—		79,110		8,312	1987/1988	(1	)
Lockheed Martin Building	Office	Reston, VA		25,240		10,210		58,884		977		10,297		59,774		—		—		70,071		7,259	1987/1988	(1	)
Candler Building	Office	Baltimore, MD		—		12,500		48,734		2,276		12,555		50,955		—		—		63,510		5,671	1911/1990	(1	)
Orbital Sciences	Office	Dulles, VA		23,611		5,699		51,082		1,282		5,748		52,315		—		—		58,063		3,638	2000/2001	(1	)
2300 N Street	Office	Washington, DC		66,000		16,509		22,415		14,752		16,650		37,026		—		—		53,676		15,434	1986	(1	)
Reston Corporate Center	Office	Reston, VA		23,806		9,135		41,398		1,387		9,213		42,707		—		—		51,920		5,363	1984	(1	)
Capital Gallery	Office	Washington, DC		54,872		4,725		29,560		17,198		4,771		46,712		—		—		51,483		24,447	1981	(1	)
191 Spring Street	Office	Lexington, MA		22,074		2,850		27,166		18,802		2,850		45,968		—		—		48,818		18,298	1971/1995	(1	)
New Dominion Technology Park, Bldg. One	Office	Herndon, VA		57,549		3,880		43,227		712		3,880		43,939		—		—		47,819		2,385	2001	(1	)
1301 New York Avenue	Office	Washington, DC		30,540		9,250		18,750		17,678		9,250		36,428		—		—		45,678		4,218	1983/1998	(1	)
200 West Street	Office	Waltham, MA		—		16,148		24,983		164		16,148		25,147		—		—		41,295		3,854	1999	(1	)
University Place	Office	Cambridge, MA		24,117		—		37,091		3,176		27		40,240		—		—		40,267		4,454	1985	(1	)
Sumner Square	Office	Washington, DC		29,736		624		28,745		9,449		958		37,860		—		—		38,818		4,387	1985	(1	)
2600 Tower Oaks Boulevard	Office	Rockville, MD		30,218		4,243		31,125		874		4,243		31,999		—		—		36,242		1,532	2001	(1	)
Quorum Office Park	Office	Chelmsford, MA		28,818		3,750		32,454		—		3,750		32,454		—		—		36,204		1,086	2001	(1	)
500 E Street	Office	Washington, DC		—		109		22,420		12,102		1,569		33,062		—		—		34,631		17,147	1987	(1	)
One Cambridge Center	Office	Cambridge, MA		—		134		25,110		8,655		134		33,765		—		—		33,899		14,293	1987	(1	)
Eight Cambridge Center	Office	Cambridge, MA		27,490		850		25,042		113		850		25,155		—		—		26,005		2,249	1999	(1	)
Bedford Business Park	Office	Bedford, MA		20,591		534		3,403		18,753		534		22,156		—		—		22,690		10,913	1980	(1	)

110

Boston Properties, Inc.

Schedule 3—Real Estate and Accumulated Depreciation

December 31, 2002

(dollars in thousands)

						Costs Capitalized Subsequent to Acquisition
				Original						Development and Construction in Progress
Property Name				Original			Land and Improvements	Building and Improvements	Land Held for Development			Accumulated Depreciation	Year(s) Built/ Renovated	Depreciable Lives (Years)
Property Name	Type	Location	Encumbrances	Land	Building		Land and Improvements	Building and Improvements	Land Held for Development		Total	Accumulated Depreciation	Year(s) Built/ Renovated	Depreciable Lives (Years)
Ten Cambridge Center	Office	Cambridge, MA	34,708	1,299	12,943	7,702	1,868	20,076	—	—	21,944	8,591	1990	(1	)
Newport Office Park	Office	Quincy, MA	—	3,500	18,208	68	3,500	18,276	—	—	21,776	2,510	1988	(1	)
201 Spring Street	Office	Lexington, MA	—	2,849	15,303	304	2,849	15,607	—	—	18,456	2,846	1997	(1	)
10 and 20 Burlington Mall Road	Office	Burlington, MA	21,591	930	6,928	10,056	938	16,976	—	—	17,914	8,018	1984-1989/95-96	(1	)
40 Shattuck Road	Office	Andover, MA	15,939	709	14,740	1,005	709	15,745	—	—	16,454	544	2001	(1	)
Montvale Center	Office	Gaithersburg, MD	7,284	1,574	9,786	4,949	2,399	13,910	—	—	16,309	6,451	1987	(1	)
Broad Run Business Park, Building E	Office	Loudon County, VA	—	497	15,131	—	497	15,131	—	—	15,628	263	2002	(1	)
The Arboretum	Office	Reston, VA	—	2,850	9,025	2,380	2,850	11,405	—	—	14,255	1,560	1999	(1	)
Lexington Office Park	Office	Lexington, MA	—	998	1,426	11,704	1,073	13,055	—	—	14,128	6,876	1982	(1	)
Three Cambridge Center	Office	Cambridge, MA	—	174	12,200	1,370	174	13,570	—	—	13,744	5,460	1987	(1	)
181 Spring Street	Office	Lexington, MA	—	1,066	9,520	1,996	1,066	11,516	—	—	12,582	952	1999	(1	)
Sugarland Business Park	Office	Herndon, VA	—	1,569	5,955	4,434	1,569	10,389	—	—	11,958	2,427	1986/1997	(1	)
Decoverly Three	Office	Rockville, MD	—	2,650	8,465	613	2,650	9,078	—	—	11,728	1,065	1989	(1	)
Decoverly Two	Office	Rockville, MD	—	1,994	8,814	99	1,994	8,913	—	—	10,907	1,117	1987	(1	)
91 Hartwell Avenue	Office	Lexington, MA	17,666	784	6,464	2,870	784	9,334	—	—	10,118	4,701	1985	(1	)
92-100 Hayden Avenue	Office	Lexington, MA	—	594	6,748	2,717	594	9,465	—	—	10,059	4,484	1985	(1	)
7501 Boston Boulevard, Building Seven	Office	Springfield, VA	—	665	9,273	9	665	9,282	—	—	9,947	1,237	1997	(1	)
Waltham Office Center	Office	Waltham, MA	—	422	2,719	6,103	425	8,819	—	—	9,244	4,882	1968-1970/87-88	(1	)
195 West Street	Office	Waltham, MA	—	1,611	6,652	939	1,611	7,591	—	—	9,202	2,571	1990	(1	)
Eleven Cambridge Center	Office	Cambridge, MA	—	121	5,535	2,484	121	8,019	—	—	8,140	3,698	1984	(1	)
170 Tracer Lane	Office	Waltham, MA	—	398	4,601	1,826	418	6,407	—	—	6,825	4,120	1980	(1	)
7435 Boston Boulevard, Building One	Office	Springfield, VA	—	392	3,822	2,515	486	6,243	—	—	6,729	3,762	1982	(1	)
7450 Boston Boulevard, Building Three	Office	Springfield, VA	—	1,165	4,681	328	1,327	4,847	—	—	6,174	664	1987	(1	)
8000 Grainger Court, Building Five	Office	Springfield, VA	—	366	4,282	1,260	453	5,455	—	—	5,908	2,480	1984	(1	)
7300 Boston Boulevard, Building Thirteen	Office	Springfield, VA	—	608	4,814	—	608	4,814	—	—	5,422	146	2002	(1	)

111

Boston Properties, Inc.

Schedule 3—Real Estate and Accumulated Depreciation

December 31, 2002

(dollars in thousands)

						Costs Capitalized Subsequent to Acquisition
				Original						Development and Construction in Progress
Property Name				Original			Land and Improvements	Building and Improvements	Land Held for Development			Accumulated Depreciation	Year(s) Built/ Renovated	Depreciable Lives (Years)
Property Name	Type	Location	Encumbrances	Land	Building		Land and Improvements	Building and Improvements	Land Held for Development		Total	Accumulated Depreciation	Year(s) Built/ Renovated	Depreciable Lives (Years)
32 Hartwell Avenue	Office	Lexington, MA	—	168	1,943	3,062	168	5,005	—	—	5,173	3,997	1968-1979/1987	(1	)
Fourteen Cambridge Center	Office	Cambridge, MA	—	110	4,483	569	110	5,052	—	—	5,162	2,320	1983	(1	)
7500 Boston Boulevard, Building Six	Office	Springfield, VA	—	138	3,749	1,212	273	4,826	—	—	5,099	1,826	1985	(1	)
7601 Boston Boulevard, Building Eight	Office	Springfield, VA	—	200	878	3,506	378	4,206	—	—	4,584	1,932	1986	(1	)
33 Hayden Avenue	Office	Lexington, MA	—	266	3,234	718	266	3,952	—	—	4,218	1,916	1979	(1	)
8000 Corporate Court, Building Eleven	Office	Springfield, VA	—	136	3,071	564	687	3,084	—	—	3,771	1,140	1989	(1	)
7375 Boston Boulevard, Building Ten	Office	Springfield, VA	—	23	2,685	766	47	3,427	—	—	3,474	1,385	1988	(1	)
7451 Boston Boulevard, Building Two	Office	Springfield, VA	—	249	1,542	1,619	535	2,875	—	—	3,410	2,189	1982	(1	)
204 Second Avenue	Office	Waltham, MA	—	37	2,402	847	37	3,249	—	—	3,286	1,835	1981/1993	(1	)
7374 Boston Boulevard, Building Four	Office	Springfield, VA	—	241	1,605	701	303	2,244	—	—	2,547	998	1984	(1	)
Hilltop Business Center	Office	San Francisco, CA	5,398	53	492	1,750	109	2,186	—	—	2,295	1,165	early 1970's	(1	)
164 Lexington Road	Office	Billerica, MA	—	592	1,370	132	592	1,502	—	—	2,094	277	1982	(1	)
17 Hartwell Avenue	Office	Lexington, MA	—	26	150	639	26	789	—	—	815	696	1968	(1	)
38 Cabot Boulevard	Industrial	Langhorne, PA	—	329	1,238	2,608	329	3,846	—	—	4,175	2,835	1972/1984	(1	)
40-46 Harvard Street	Industrial	Westwood, MA	—	351	1,782	1,327	351	3,109	—	—	3,460	3,102	1967/1996	(1	)
430 Rozzi Place	Industrial	San Francisco, CA	—	9	217	33	9	250	—	—	259	107	early 1970's	(1	)
560 Forbes Boulevard	Industrial	San Francisco, CA	—	9	120	—	9	120	—	—	129	79	early 1970's	(1	)
Cambridge Center Marriott	Hotel	Cambridge, MA	—	478	37,918	11,121	478	49,039	—	—	49,517	17,860	1986	(1	)
Long Wharf Marriott	Hotel	Boston, MA	—	1,708	31,904	10,945	1,708	42,849	—	—	44,557	21,238	1982	(1	)
Residence Inn by Marriott	Hotel	Cambridge, MA	—	2,039	22,732	333	2,039	23,065	—	—	25,104	1,981	1999	(1	)
Cambridge Center North Garage	Garage	Cambridge, MA	—	1,163	11,633	251	1,163	11,884	—	—	13,047	3,950	1990	(1	)
12050 Sunset Hills Road	Garage	Reston, VA	—	—	9,459	—	—	9,459	—	—	9,459	—	Various	N/A

112

Boston Properties, Inc.

Schedule 3—Real Estate and Accumulated Depreciation

December 31, 2002

(dollars in thousands)

									Costs Capitalized Subsequent to Acquisition
					Original												Development and Construction in Progress
Property Name					Original						Land and Improvements		Building and Improvements		Land Held for Development						Accumulated Depreciation		Year(s) Built/ Renovated	Depreciable Lives (Years)
Property Name	Type	Location	Encumbrances		Land		Building				Land and Improvements		Building and Improvements		Land Held for Development				Total		Accumulated Depreciation		Year(s) Built/ Renovated	Depreciable Lives (Years)
Times Square Tower	Development	New York, NY		222,196		—		—		350,909		—		—		—		350,909		350,909		—	Various	N/A
Waltham Weston Corporate Center	Development	Waltham, MA		44,840		—		—		66,787		—		—		—		66,787		66,787		268	Various	N/A
New Dominion Technology Park, Bldg. Two	Development	Herndon, VA		7,558		—		—		9,434		—		—		—		9,434		9,434		—	Various	N/A
Plaza at Almaden	Land	San Jose, CA		—		—		—		36,230		—		—		36,230		—		36,230		—	Various	N/A
Tower Oaks Master Plan	Land	Rockville, MD		—		—		—		28,165		—		—		28,165		—		28,165		—	Various	N/A
Weston Corporate Center	Land	Weston, MA		—		—		—		21,163		—		—		21,163		—		21,163		—	Various	N/A
Washingtonian North	Land	Gaithersburg, MD		—		—		—		17,534		—		—		17,534		—		17,534		—	Various	N/A
77 4th Avenue	Land	Waltham, MA		—		—		—		14,397		—		—		14,397		—		14,397		—	Various	N/A
Reston Eastgate	Land	Reston, VA		—		—		—		8,844		—		—		8,844		—		8,844		—	Various	N/A
Reston Gateway	Land	Reston, VA		—		—		—		8,647		—		—		8,647		—		8,647		—	Various	N/A
Crane Meadow	Land	Marlborough, MA		—		—		—		8,600		—		—		8,600		—		8,600		—	Various	N/A
One Preserve Parkway	Land	Rockville, MD		—		—		—		6,803		—		—		6,803		—		6,803		—	Various	N/A
Broad Run Business Park	Land	Loudon County, VA		—		—		—		6,791		—		—		6,791		—		6,791		—	Various	N/A
Decoverly Seven	Land	Rockville, MD		—		—		—		5,290		5,290		—		—		—		5,290		—	Various	N/A
12280 Sunrise Valley Drive	Land	Reston, VA		—		—		—		4,062		—		—		4,062		—		4,062		—	Various	N/A
Decoverly Six	Land	Rockville, MD		—		—		—		3,913		—		—		3,913		—		3,913		—	Various	N/A
20 F Street	Land	Washington, DC		—		—		—		3,008		—		—		3,008		—		3,008		—	Various	N/A
Decoverly Five	Land	Rockville, MD		—		—		—		1,832		—		—		1,832		—		1,832		—	Various	N/A
Decoverly Four	Land	Rockville, MD		—		—		—		1,804		—		—		1,804		—		1,804		—	Various	N/A
Cambridge Master Plan	Land	Cambridge, MA		—		—		—		1,652		—		—		1,652		—		1,652		—	Various	N/A
Seven Cambridge Center	Land	Cambridge, MA		—		—		—		1,414		—		—		1,414		—		1,414		—	Various	N/A
30 Shattuck Road	Land	Andover, MA		—		—		—		1,117		—		—		1,117		—		1,117		—	Various	N/A

			$	4,267,119	$	1,694,632	$	5,584,106	$	1,341,959	$	1,722,688	$	6,233,567	$	215,866	$	448,576	$	8,620,697	$	800,385

(1): Depreciation of the buildings and improvements are calculated over lives ranging from the life of the lease to 40 years.
(2): The aggregate cost and accumulated depreciation for tax purposes was approximately $6.3 billion and $1.1 billion, respectively.

113

Boston Properties, Inc.

Real Estate and Accumulated Depreciation

December 31, 2002

(dollars in thousands)

A summary of activity for real estate and accumulated depreciation is as follows:

			2002			2001			2000
Real Estate:
	Balance at the beginning of the year		$	7,391,366		$	6,054,785		$	5,570,887
		Additions to and improvements of real estate		1,426,026			1,357,543			759,540
		Assets sold and written-off		(196,695	)		(20,962	)		(275,642	)

	Balance at the end of the year		$	8,620,697		$	7,391,366		$	6,054,785

Accumulated Depreciation:
	Balance at the beginning of the year		$	682,921		$	553,264		$	445,138
		Depreciation expense		164,063			134,019			118,748
		Assets sold and written-off		(46,599	)		(4,362	)		(10,622	)

	Balance at the end of the year		$	800,385		$	682,921		$	553,264

114

QuickLinks

TABLE OF CONTENTS
PART I

Item 1. Business

Business and Growth Strategies
Competition
The Hotel Properties
Seasonality
RISK FACTORS

Item 3. Legal Proceedings

Item 4. Submission of Matters to a Vote of Security Holders

PART II

Item 5. Market for Registrant's Common Equity and Related Stockholder Matters

Item 6. Selected Financial Data

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 7A. Quantitative and Qualitative Disclosures about Market Risk

Item 8. Financial Statements and Supplementary Data

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosures

PART III

Item 10. Directors and Executive Officers of the Registrant

Item 11. Executive Compensation

Item 12. Security Ownership of Beneficial Owners and Management

Item 13. Certain Relationships and Related Transactions

Item 14. Controls and Procedures

Item 15. Exhibits, Financial Statement Schedule and Reports on Form 8-K

SIGNATURES
CERTIFICATION
CERTIFICATION
BOSTON PROPERTIES, INC. INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
BOSTON PROPERTIES, INC. CONSOLIDATED BALANCE SHEETS
BOSTON PROPERTIES, INC. CONSOLIDATED STATEMENTS OF OPERATIONS
BOSTON PROPERTIES, INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
BOSTON PROPERTIES, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS
BOSTON PROPERTIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Boston Properties, Inc. Schedule 3—Real Estate and Accumulated Depreciation December 31, 2002 (dollars in thousands)
Boston Properties, Inc. Schedule 3—Real Estate and Accumulated Depreciation December 31, 2002 (dollars in thousands)
Boston Properties, Inc. Schedule 3—Real Estate and Accumulated Depreciation December 31, 2002 (dollars in thousands)
Boston Properties, Inc. Schedule 3—Real Estate and Accumulated Depreciation December 31, 2002 (dollars in thousands)
Boston Properties, Inc. Real Estate and Accumulated Depreciation December 31, 2002 (dollars in thousands)



                                                                    EXHIBIT 10.7

                              EMPLOYMENT AGREEMENT

     THIS AGREEMENT (the "AGREEMENT") is made as of the 17th day of January,
2003 (the "EFFECTIVE DATE"), by and between Mortimer B. Zuckerman (the
"EMPLOYEE") and Boston Properties, Inc., a Delaware corporation, with its
principal executive office located at 111 Huntington Avenue, Suite 300, Boston,
Massachusetts 02199-7610 (together with its subsidiaries, the "COMPANY").

                                WITNESSETH THAT:

     WHEREAS, the Company has determined that it is in its best interest to
continue the employment of the Employee on the terms hereinafter set forth;

     WHEREAS, the Employee wishes to be so employed pursuant to the terms
hereinafter set forth;

     WHEREAS, the Company and the Employee have entered into that certain
Noncompetition Agreement, dated as of June 14, 1997, which agreement the parties
desire to be amended and superseded in its entirety by this Agreement;

     WHEREAS, the Company and the Employee, among others, have entered into that
certain Indemnification Agreement, dated as of June 23, 1997 (the "DIRECTOR
INDEMNIFICATION AGREEMENT"), and that certain Senior Employee Severance
Agreement, dated as of July 30, 1998 (the "SEVERANCE AGREEMENT"), each as may be
amended from time to time, and each of which the parties desire to remain in
full force and effect after the date hereof;

     NOW, THEREFORE, in consideration of the mutual covenants and premises set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Employee
hereby agree as follows:

     1.  TERM. Subject to the provisions of Paragraph 8, the term of employment
pursuant to this Agreement (the "TERM") shall be three (3) years from the
Effective Date and shall be renewed automatically for periods of one (1) year
commencing at each anniversary of the Effective Date, unless written notice is
given by either party to the other not less than ninety (90) days prior to any
such anniversary of such party's election not to extend the Term.

     2.  EMPLOYMENT; DUTIES; LOCATION.

         (a) Employee shall initially serve as an officer of the Company with
the title Chairman and as a member of the Board of Directors of the Company (the
"BOARD OF DIRECTORS"). Employee's duties and authority shall be commensurate
with his title and position with the Company. The Employee shall report directly
to the Board of Directors and shall serve the Company in such other or
additional offices as the Employee may be requested to serve by the Board of
Directors. In such capacity or capacities, the Employee shall perform such
services and duties in connection with the business, affairs and operations of
the Company as may be assigned or delegated to the Employee from time to time by
or under the authority of the Board of Directors. The Employee shall be
principally located at the Company's New York office.



         (b) Employee agrees to his employment as described in this Paragraph 2
and agrees to devote a majority of his working time and efforts to the
performance of his duties hereunder, except as otherwise approved by the Board
of Directors. Notwithstanding the foregoing, nothing herein shall be interpreted
to preclude Employee from (i) engaging in Minority Interest Passive Investments
(as defined below), including Minority Interest Passive Investments in, or
relating to the ownership, development, operation, management, or leasing of,
commercial real estate properties or (ii) participating as an officer or
director of, or advisor to, any organization that is not engaged in the
acquisition, development, construction, operation, management, or leasing of any
commercial real estate property; PROVIDED that such activities and related
duties and pursuits do not materially restrict Employee's ability to fulfill his
obligations as an officer and employee of the Company as set forth herein.

     Engaging in a "MINORITY INTEREST PASSIVE INVESTMENT" means acquiring,
holding, and exercising the voting rights associated with an investment made
through (i) the purchase of securities (including partnership interests) that
represent a non-controlling, minority interest in an entity or (ii) the lending
of money, in either case with the purpose or intent of obtaining a return on
such investment but without management by Employee of the property or business
to which such investment directly or indirectly relates and without any business
or strategic consultation by Employee with such entity.

     3.  COMPENSATION.

         (a) BASE SALARY. The Company shall pay Employee an annual salary of
Five Hundred Thousand Dollars ($500,000) (the "BASE SALARY"), payable in
accordance with the Company's normal business practices for senior executives
(including tax withholding), but in no event less frequently than monthly.
Employee's Base Salary shall be reviewed at least annually by the Board of
Directors or the Compensation Committee of the Board of Directors (the
"COMPENSATION COMMITTEE") and may be increased but not decreased in its
discretion.

         (b) BONUS. On each annual compensation determination date established
by the Company during the Term, the Company shall review the performance of the
Company and of Employee during the prior year, and the Company may provide
Employee with additional compensation as a bonus if the Board of Directors, or
the Compensation Committee, in its discretion, determines that Employee's
contribution to the Company warrants such additional payment and the Company's
anticipated financial performance for the present period permits such payment.

     4.  BENEFITS.

         (a) MEDICAL/DENTAL INSURANCE. The Employee shall be entitled to
participate in any and all employee benefit plans, including all medical and
dental insurance plans as in effect from time to time for senior executives of
the Company. Such participation shall be subject to (i) the terms of the
applicable plan documents, (ii) generally applicable policies of the Company,
and (iii) the discretion of the Board of Directors, the Compensation Committee
or any administrative or other committee provided for in, or contemplated by,
such plan. Nothing contained in this Agreement shall be construed to create any
obligation on the part of the

                                        2


Company to establish any such plan or to maintain the effectiveness of any such
plan which may be in effect from time to time.

         (b) LIFE INSURANCE; DISABILITY INSURANCE. The Company shall provide
Employee with such life and/or disability insurance as the Company may from time
to time make available to senior executives of the Company.

         (c) EXPENSES. The Company shall promptly reimburse Employee for all
reasonable business expenses incurred by Employee in accordance with the
practices of the Company for senior executives of the Company, as in effect from
time to time.

         (d) VACATION. The Employee shall receive paid vacation annually in
accordance with terms determined for such Employee by the Company, but in no
event shall Employee receive less than four weeks of paid vacation per year.

         (e) STOCK OPTIONS; RESTRICTED STOCK. The Employee shall be entitled to
grants of stock options and restricted stock awards in an amount to be
determined by the Compensation Committee in its discretion under the Boston
Properties, Inc. 1997 Stock Option and Incentive Plan or any other stock option
plan adopted by the Company from time to time (the "STOCK OPTION PLAN").

         (f) DEFERRED COMPENSATION. The Employee shall be entitled to
participate in any deferred compensation plan or arrangement that the Company
may have in place for its senior executives, directors and/or officers.

         (g) AUTOMOBILE. The Company shall provide Employee with the use of a
Company-owned or leased automobile.

         (h) OTHER BENEFITS. The Company shall provide to Employee such other
benefits, including the right to participate in such retirement or pension
plans, as are made generally available to senior executives of the Company from
time to time. Such participation shall be subject to (i) the terms of the
applicable plan documents, (ii) generally applicable policies of the Company,
and (iii) the discretion of the Board of Directors, the Compensation Committee
or any administrative or other committee provided for in, or contemplated by,
such plan.

         (i) TAXATION OF PAYMENTS AND BENEFITS. The Company shall undertake to
make deductions, withholdings and tax reports with respect to payments and
benefits under this Agreement to the extent that it reasonably and in good faith
believes that it is required to make such deductions, withholdings and tax
reports. Payments under this Agreement shall be in amounts net of any such
deductions or withholdings. Nothing in this Agreement shall be construed to
require the Company to make any payments to compensate the Employee for any
adverse tax effect associated with any payments or benefits or for any deduction
or withholding from any payment or benefit.

     5.  INDEMNIFICATION. To the full extent permitted by law and subject to the
Company's Certificate of Incorporation and Bylaws, the Company shall indemnify
Employee with respect to any actions commenced against Employee in his capacity
as a director or officer

                                        3


or former director or officer of the Company, or any affiliate thereof for which
he may serve in such capacity, and the Company shall advance on a timely basis
any expenses incurred in defending such actions. The obligation to indemnify
hereunder shall survive the termination of this Agreement. The Company agrees to
use its best efforts to secure and maintain directors' and officers' liability
insurance with respect to Employee.

     6.  COMPANY AUTHORITY/POLICIES. Employee agrees to observe and comply with
the rules and regulations of the Company as adopted by its Board of Directors
respecting the performance of his duties and to carry out and perform orders,
directions and policies communicated to him from time to time by the Board of
Directors.

     7.  RECORDS/NONDISCLOSURE/COMPANY POLICIES.

         (a) GENERAL. All records, financial statements and similar documents
obtained, reviewed or compiled by Employee in the course of the performance by
him of services for the Company, whether or not confidential information or
trade secrets, shall be the exclusive property of the Company. Employee shall
have no rights in such documents upon any termination of this Agreement.

         (b) CONFIDENTIAL INFORMATION. Employee will not disclose to any person
or entity (except as required by applicable law, the rules of the New York Stock
Exchange, or otherwise in connection with the performance of his duties and
responsibilities hereunder), or use for his own benefit or gain, any
confidential information of the Company obtained by him incident to his
employment with the Company. Employee shall take all reasonable steps to
safeguard any confidential information and to protect such confidential
information against disclosure, misuse, loss, or theft. The term "CONFIDENTIAL
INFORMATION" includes, without limitation, financial information, business
plans, prospects, and opportunities which have been discussed or considered by
the management of the Company, but does not include any information which has
become part of the public domain by means other than Employee's non-observance
of his obligations hereunder.

     This Paragraph 7 shall survive the termination of this Agreement.

     8.  TERMINATION/SEVERANCE.

         (a) GENERAL.

             (i)    AT WILL EMPLOYMENT. Employee's employment hereunder is "at
will" and, therefore, may be terminated at any time, with or without cause, at
the option of the Company, subject only to the severance obligations under this
Paragraph 8.

             (ii)   NOTICE OF TERMINATION. Except for termination as a result of
Employee's death as specified in Subparagraph 8(b), any termination of
Employee's employment by the Company or any such termination by Employee shall
be communicated by written Notice of Termination to the other party hereto. For
purposes of this Agreement, a "NOTICE OF TERMINATION" shall mean a notice which
shall indicate the specific termination provision hereunder relied upon by the
terminating party.

                                        4


             (iii)  DATE OF TERMINATION. "DATE OF TERMINATION" shall mean: (A)
if Employee's employment is terminated by his death, the date of his death; (B)
if Employee's employment is terminated on account of disability under
Subparagraph 8(c), the date on which Notice of Termination is given; (C) if
Employee's employment is terminated by the Company for Cause under Subparagraph
8(d), the date on which a Notice of Termination is given; (D) if Employee's
employment is terminated by the Company without Cause under Subparagraph
8(e)(i), thirty (30) days after the date on which a Notice of Termination is
given; and (E) if Employee's employment is terminated by Employee under
Subparagraph 8(e)(ii) or 8(f), thirty (30) days after the date on which a Notice
of Termination is given.

         (b) DEATH. Employee's employment hereunder shall terminate upon his
death. If Employee's employment terminates by reason of his death, the Company
shall, within ninety (90) days of death, pay in a lump sum amount to such person
as Employee shall designate in a notice filed with the Company or, if no such
person is designated, to Employee's estate, Employee's accrued and unpaid Base
Salary to his date of death, plus his accrued and unpaid target bonus prorated
for the number of days actually employed in the then current calendar year. All
unvested stock options and stock-based grants shall immediately vest in
Employee's estate or other legal representatives and become exercisable or
nonforfeitable, and Employee's estate or other legal representatives shall have
such period of time to exercise the stock options as is provided in the Stock
Option Plan and agreements with Employee pursuant thereto. For a period of
eighteen (18) months following the Date of Termination and subject to the
continued copayment of premium amounts by the Employee's spouse and dependents,
the Employee's spouse and dependents shall continue to participate in the
Company's health insurance plan upon the same terms and conditions in effect on
the Date of Termination, PROVIDED, HOWEVER, that the continuation of health
benefits under this Subparagraph shall reduce and count against the rights of
the Employee's spouse and dependents under the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended ("COBRA"). In addition to the foregoing,
any payments to which Employee's spouse, beneficiaries, or estate may be
entitled under any employee benefit plan shall also be paid in accordance with
the terms of such plan or arrangement. Such payments, in the aggregate, shall
fully discharge the Company's obligations hereunder.

         (c) DISABILITY. If, as a result of Employee's incapacity due to
physical or mental illness, Employee shall have been absent from his duties
hereunder on a full-time basis for one hundred eighty (180) calendar days in the
aggregate in any twelve (12) month period, the Company may terminate Employee's
employment hereunder. During any period that Employee fails to perform his
duties hereunder as a result of incapacity due to physical or mental illness,
Employee shall continue to receive his accrued and unpaid Base Salary and
accrued and unpaid target bonus, prorated for the number of days actually
employed in the then current calendar year, until Employee's employment is
terminated due to disability in accordance with this Subparagraph (c) or until
Employee terminates his employment in accordance with Subparagraph (e)(ii) or
(f), if earlier. All unvested stock options and stock-based grants shall
immediately vest and become exercisable or nonforfeitable, and Employee shall
have such period of time to exercise the stock options as is provided in the
Stock Option Plan and agreements with Employee pursuant thereto. For a period of
eighteen (18) months following the Date of Termination and subject to the
Employee's continued copayment of premium amounts, the Employee, Employee's
spouse and dependents shall continue to participate in the Company's

                                        5


health insurance plan upon the same terms and conditions in effect on the Date
of Termination, PROVIDED, HOWEVER, that the continuation of health benefits
under this Subparagraph shall reduce and count against Employee's rights under
COBRA. In addition to the foregoing, any payments to which Employee may be
entitled under any employee benefit plan shall also be paid in accordance with
the terms of such plan or arrangement. Such payments, in the aggregate, shall
fully discharge the Company's obligations hereunder.

         (d) TERMINATION BY THE COMPANY FOR CAUSE.

             (i)    The Company may terminate Employee's employment hereunder
for Cause. "CAUSE" shall mean: (A) gross negligence or willful misconduct by
Employee in connection with the performance of his material duties hereunder;
(B) a breach by Employee of any of his material duties hereunder (for reasons
other than physical or mental illness) and the failure of Employee to cure such
breach within thirty (30) days after written notice thereof by the Company; (C)
conduct by Employee against the material best interests of the Company or a
material act of common law fraud against the Company or its affiliates or
employees; or (D) indictment of Employee of a felony and such indictment has a
material adverse affect on the interests or reputation of the Company.
Termination for Cause may only occur at a meeting of the Board of Directors
called for this purpose and at which the Employee has the opportunity to be
represented by counsel.

             (ii)   If Employee's employment is terminated by the Company for
Cause, then the Company shall, through the Date of Termination, pay Employee his
accrued and unpaid Base Salary. Thereafter, the Company shall have no further
obligations to Employee except as otherwise provided hereunder; PROVIDED that
any such termination shall not adversely affect or alter Employee's rights under
any employee benefit plan of the Company in which Employee, at the Date of
Termination, has a vested interest, unless otherwise provided in such employee
benefit plan or any agreement or other instrument attendant thereto.
Notwithstanding the foregoing and in addition to whatever other rights or
remedies the Company may have at law or in equity, all stock options and other
stock-based grants held by Employee, whether vested or unvested as of the Date
of Termination, shall immediately expire on the Date of Termination if
Employee's employment is terminated by the Company for Cause.

         (e) TERMINATION BY THE COMPANY WITHOUT CAUSE OR BY EMPLOYEE FOR GOOD
REASON.

             (i)    The Company may terminate Employee's employment hereunder
without Cause if such termination is approved by the Board of Directors. Any
termination by the Company of Employee's employment hereunder which does not (A)
constitute a termination for Cause under Subparagraph (d)(i), (B) result from
the death or disability of the Employee under Subparagraph (b) or (c), or (C)
result from the expiration of the Term shall be deemed a termination without
Cause.

             (ii)   The Employee may terminate his employment hereunder for Good
Reason. "GOOD REASON" shall mean: (A) a substantial adverse change, not
consented to by Employee, in the nature or scope of Employee's responsibilities,
authorities, powers, functions, or duties under this Agreement; (B) a breach by
the Company of any of its material obligations

                                        6


hereunder and the failure of the Company to cure such breach within thirty (30)
days after written notice thereof by Employee; or (C) the involuntary relocation
of the Company's offices at which Employee is principally employed to a location
more than fifty (50) miles from such offices, or the requirement by the Company
that Employee be based anywhere other than the Company's offices at such
location on an extended basis, except for required travel on the Company's
business to an extent substantially consistent with Employee's business travel
obligations.

             (iii)  If Employee's employment is terminated by the Company
without Cause or if Employee terminates his employment for Good Reason in
accordance with this Subparagraph (e), then the Company shall, through the Date
of Termination, pay Employee his accrued and unpaid Base Salary and his accrued
and unpaid target bonus prorated for the number of days actually employed in the
then current calendar year. In addition, subject to signing by Employee of a
general release of claims in a form and manner satisfactory to the Company, the
Employee shall be entitled to the following:

                    (A) Salary continuation in an amount (the "SEVERANCE
     AMOUNT") equal to the sum of (x) his annual Base Salary under Subparagraph
     3(a) and (y) the amount of his cash bonus, if any, received in respect of
     the immediately preceding year under Subparagraph 3(b). The Severance
     Amount shall be paid in equal monthly installments over a twelve (12) month
     period;

                    (B) All stock options and other stock-based awards, granted
     to Employee after the Effective Date, in which Employee would have vested
     if he had remained employed for a period of twelve (12) months commencing
     on the Date of Termination shall vest and become exercisable or
     nonforfeitable as of the Date of Termination;

                    (C) Subject to the Employee's continued copayment of premium
     amounts, continued participation for twelve (12) months in the Company's
     health insurance plan upon the same terms and conditions in effect on the
     Date of Termination, PROVIDED, HOWEVER, that the continuation of health
     benefits under this Subparagraph shall reduce and count against Employee's
     rights under COBRA; and

                    (D) Subject to (B) above, all rights and benefits granted or
     in effect with respect to Employee under the Stock Option Plan and
     agreements with Employee pursuant thereto.

         (f) VOLUNTARY TERMINATION BY EMPLOYEE. Employee may terminate his
employment hereunder for any reason, including, but not limited to, Good Reason
in accordance with Subparagraph (e)(ii). If Employee's employment is terminated
by Employee other than for Good Reason, then the Company shall, through the Date
of Termination, pay Employee his accrued and unpaid Base Salary. Thereafter, the
Company shall have no further obligations to Employee except as otherwise
expressly provided hereunder; PROVIDED any such termination shall not adversely
affect or alter Employee's rights under any employee benefit plan of the Company
in which Employee, at the Date of Termination, has a vested interest, unless
otherwise provided in such employee benefit plan or any agreement or other
instrument attendant thereto.

                                        7


The vesting and exercise of any stock options and the forfeitability of any
stock-based grants held by Employee shall be governed by the terms of the Stock
Option Plan and the related agreements between Employee and the Company

         (g) NO MITIGATION. Without regard to the reason for the termination of
Employee's employment hereunder, Employee shall be under no obligation to
mitigate damages with respect to such termination under any circumstances and in
the event Employee is employed or receives income from any other source, there
shall be no offset against the amounts due from the Company hereunder.

     9.  NONCOMPETITION. Because Employee's services to the Company are special
and because Employee has access to the Company's confidential information,
Employee covenants and agrees that during the Employment Period and until the
end of a one-year period following the termination of Employee's employment with
the Company for any reason, Employee shall not, without the prior written
consent of the Company (which shall be authorized by approval of the Board of
Directors of the Company, including the approval of a majority of the
independent Directors of the Company), directly or indirectly:

         (a) engage, participate or assist in, either individually or as an
owner, partner, employee, consultant, director, officer, trustee, or agent of
any business that engages or attempts to engage in, directly or indirectly, the
acquisition, development, construction, operation, management, or leasing of any
commercial real estate property;

         (b) intentionally interfere with, disrupt or attempt to disrupt the
relationship, contractual or otherwise, between the Company or its affiliates
and any tenant, supplier, contractor, lender, employee, or governmental agency
or authority; or

         (c) call upon, compete for, solicit, divert, or take away, or attempt
to divert or take away any of the tenants or employees of the Company or its
affiliates, either for himself or for any other business, operation,
corporation, partnership, association, agency, or other person or entity.

     This Paragraph 9 shall not be interpreted to prevent Employee from engaging
in Minority Interest Passive Investments or any other activity permitted under
Subparagraph 2(b). This Paragraph 9 shall survive the termination of this
Agreement.

     Notwithstanding anything to the contrary herein, the noncompetition
provision of this Paragraph 9 shall not apply if Employee's employment
terminates after a Change in Control (as defined in the Severance Agreement).

     10. CHANGE IN CONTROL PAYMENTS. Notwithstanding anything to the contrary in
the foregoing, in the event that the Employee's employment terminates after a
Change in Control (as defined in the Severance Agreement) under circumstances
that would entitle him to payments and benefits under the Severance Agreement,
he shall not be entitled to receive any payments or benefits under this
Agreement.

     11. CONFLICTING AGREEMENTS. Employee hereby represents and warrants that
the execution of this Agreement and the performance of his obligations hereunder
will not breach or

                                        8


be in conflict with any other agreement to which he is a party or is bound, and
that he is not now subject to any covenants against competition or similar
covenants which would affect the performance of his obligations hereunder.

     12. NOTICES. All notices, requests, demands, and other communications under
this Agreement shall be in writing and shall be deemed duly given (i) if
delivered by hand and receipted for by the party addressee, on the date of such
receipt or (ii) if mailed by domestic certified or registered mail with postage
prepaid, on the third business day after the date postmarked. Address for notice
for the Company is as shown above, or as subsequently modified by written
notice. Address for notice for the Employee is the address shown on the records
of the Company.

     13. INTEGRATION. This Agreement constitutes the entire agreement between
the parties with respect to the subject matter hereof and supersedes all prior
agreements between the parties with respect to any related subject matter,
PROVIDED, HOWEVER, that the Director Indemnification Agreement and Severance
Agreement, each as amended from time to time, shall remain in full force and
effect hereafter.

     14. ASSIGNMENT; SUCCESSORS AND ASSIGNS, ETC. Neither the Company nor the
Employee may make any assignment of this Agreement or any interest herein, by
operation of law or otherwise, without the prior written consent of the other
party; PROVIDED that the Company may assign its rights under this Agreement
without the consent of the Employee in the event that the Company shall effect a
reorganization, consolidate with or merge into any other corporation,
partnership, organization or other entity, or transfer all or substantially all
of its properties or assets to any other corporation, partnership, organization
or other entity. This Agreement shall inure to the benefit of and be binding
upon the Company and the Employee, their respective successors, executors,
administrators, heirs and permitted assigns.

     15. MISCELLANEOUS. Headings herein are for convenience of reference only
and shall not define, limit or interpret the contents hereof.

     16. AMENDMENT. This Agreement may be amended, modified or supplemented by
the mutual consent of the parties in writing, but no oral amendment,
modification or supplement shall be effective.

     17. ARBITRATION; OTHER DISPUTES. Any dispute or controversy arising under
or in connection with this Agreement shall be settled exclusively by arbitration
in Boston, Massachusetts, in accordance with the rules of the American
Arbitration Association then in effect. Judgment may be entered in any court
having jurisdiction. Notwithstanding the above, the Company shall be entitled to
seek a restraining order or injunction in any court of competent jurisdiction to
prevent any continuation of any violation of Paragraph 7 or 9 hereof. In the
event that the Company terminates Employee's employment for Cause under
Subparagraph 8(d)(i) and Employee contends that Cause did not exist, then the
Company's only obligation shall be to submit such claim to arbitration and the
only issue before the arbitrator will be whether Employee was in fact terminated
for Cause. If the arbitrator determines that Employee was not terminated for
Cause by the Company, then the only remedies that the arbitrator may award are
(i) the Severance Amount specified in Subparagraph 8(e)(iii)(A), (ii) the costs
of arbitration,

                                        9


(iii) Employee's reasonable attorneys' fees, (iv) the additional vesting of
Employee's stock options and other stock-based awards in accordance with
Subparagraph 8(e)(iii)(B), and (v) the continued participation in the Company's
health insurance plan in accordance with Subparagraph 8(e)(iii)(C). If the
arbitrator finds that Employee was terminated for Cause, the arbitrator will be
without authority to award Employee anything, and the parties will each be
responsible for their own attorneys' fees, and they will divide the costs of
arbitration equally. Furthermore, should a dispute occur concerning Employee's
mental or physical capacity as described in Subparagraph 8(c), a doctor selected
by Employee and a doctor selected by the Company shall be entitled to examine
Employee. If the opinion of the Company's doctor and Employee's doctor conflict,
the Company's doctor and Employee's doctor shall together agree upon a third
doctor, whose opinion shall be binding. This Paragraph 17 shall survive the
termination of this Agreement.

     18. LITIGATION AND REGULATORY COOPERATION. During and after Employee's
employment, Employee shall reasonably cooperate with the Company in the defense
or prosecution of any claims or actions now in existence or which may be brought
in the future against or on behalf of the Company which relate to events or
occurrences that transpired while Employee was employed by the Company; PROVIDED
that such cooperation shall not materially and adversely affect Employee or
expose Employee to an increased probability of civil or criminal litigation.
Employee's cooperation in connection with such claims or actions shall include,
without limitation, being available to meet with counsel to prepare for
discovery or trial and to act as a witness on behalf of the Company at mutually
convenient times. During and after Employee's employment, Employee also shall
cooperate fully with the Company in connection with any investigation or review
of any federal, state or local regulatory authority as any such investigation or
review relates to events or occurrences that transpired while Employee was
employed by the Company. The Company shall also provide Employee with
compensation on an hourly basis calculated at his final base compensation rate
for requested litigation and regulatory cooperation that occurs after his
termination of employment, and reimburse Employee for all costs and expenses
incurred in connection with his performance under this Paragraph 18, including,
without limitation, reasonable attorneys' fees and costs.

     19. SEVERABILITY. If any provision of this Agreement shall to any extent be
held void or unenforceable (as to duration, scope, activity, subject or
otherwise) by a court of competent jurisdiction, such provision shall be deemed
to be modified so as to constitute a provision conforming as nearly as possible
to the original provision while still remaining valid and enforceable. In such
event, the remainder of this Agreement (or the application of such provision to
persons or circumstances other than those in respect of which it is deemed to be
void or unenforceable) shall not be affected thereby. Each other provision of
this Agreement, unless specifically conditioned on the voided aspect of such
provision, shall remain valid and enforceable to the fullest extent permitted by
law; any other provisions of this Agreement that are specifically conditioned on
the voided aspect of such invalid provision shall also be deemed to be modified
so as to constitute a provision conforming as nearly as possible to the original
provision while still remaining valid and enforceable to the fullest extent
permitted by law.

     20. GOVERNING LAW. This Agreement shall be construed and regulated in all
respects under the laws of the State of Delaware.

                                       10


     21. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be taken to be
an original; but such counterparts shall together constitute one and the same
document.

                                       11


     IN WITNESS WHEREOF, this Agreement is entered into as of the date and year
first above written.

                                             BOSTON PROPERTIES, INC.


                                             By: /s/ Edward H. Linde
                                                 -------------------------------
                                                 Name: Edward H. Linde
                                                 Title: President and Chief
                                                        Executive Officer


                                             /s/ Mortimer B. Zuckerman
                                             -----------------------------------
                                             Mortimer B. Zuckerman

                                       12



                                                                    EXHIBIT 10.8

                              AMENDED AND RESTATED
                              EMPLOYMENT AGREEMENT

     THIS AGREEMENT (the "AGREEMENT") is made as of the 29th day of November,
2002 (the "EFFECTIVE DATE"), by and between Edward H. Linde (the "EMPLOYEE") and
Boston Properties, Inc., a Delaware corporation, with its principal executive
office located at 111 Huntington Avenue, Suite 300, Boston, Massachusetts
02199-7610 (together with its subsidiaries, the "COMPANY").

                                WITNESSETH THAT:

     WHEREAS, the Company and the Employee have entered into that certain
Employment Agreement, dated as of June 19, 1997, which agreement the parties
desire to be amended, restated and superseded in its entirety by this Agreement;

     WHEREAS, the Company has determined that it is in its best interest to
continue the employment of the Employee on the terms hereinafter set forth;

     WHEREAS, the Employee wishes to be so employed pursuant to the terms
hereinafter set forth;

     WHEREAS, the Company and the Employee, among others, have entered into that
certain Indemnification Agreement, dated as of June 23, 1997 (the "DIRECTOR
INDEMNIFICATION AGREEMENT"), and that certain Senior Employee Severance
Agreement, dated as of July 30, 1998 (the "SEVERANCE AGREEMENT"), each as may be
amended from time to time, and each of which the parties desire to remain in
full force and effect after the date hereof;

     NOW, THEREFORE, in consideration of the mutual covenants and premises set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Employee
hereby agree as follows:

     1.  TERM. Subject to the provisions of Paragraph 8, the term of employment
pursuant to this Agreement (the "TERM") shall be three (3) years from the
Effective Date and shall be renewed automatically for periods of one (1) year
commencing at each anniversary of the Effective Date, unless written notice is
given by either party to the other not less than ninety (90) days prior to any
such anniversary of such party's election not to extend the Term.

     2.  EMPLOYMENT; DUTIES; LOCATION.

         (a) Employee shall initially serve as an officer of the Company with
the title President and Chief Executive Officer and as a member of the Board of
Directors of the Company (the "BOARD OF DIRECTORS"). Employee's duties and
authority shall be commensurate with his title and position with the Company.
The Employee shall report directly to the Board of Directors and shall serve the
Company in such other or additional offices as the Employee may be requested to
serve by the Board of Directors. In such capacity or capacities, the Employee
shall perform such services and duties in connection with the business, affairs
and operations of the Company as may be assigned or delegated to the Employee
from time to time by or under the



authority of the Board of Directors. The Employee shall be principally located
at the Company's Boston office.

         (b) Employee agrees to his employment as described in this Paragraph 2
and agrees to devote substantially all of his working time and efforts to the
performance of his duties hereunder, except as otherwise approved by the Board
of Directors. Notwithstanding the foregoing, nothing herein shall be interpreted
to preclude Employee from (i) engaging in Minority Interest Passive Investments
(as defined below), including Minority Interest Passive Investments in, or
relating to the ownership, development, operation, management, or leasing of,
commercial real estate properties or (ii) participating as an officer or
director of, or advisor to, any organization that is not engaged in the
acquisition, development, construction, operation, management, or leasing of any
commercial real estate property; PROVIDED that such activities and related
duties and pursuits do not materially restrict Employee's ability to fulfill his
obligations as an officer and employee of the Company as set forth herein.

     Engaging in a "MINORITY INTEREST PASSIVE INVESTMENT" means acquiring,
holding, and exercising the voting rights associated with an investment made
through (i) the purchase of securities (including partnership interests) that
represent a non-controlling, minority interest in an entity or (ii) the lending
of money, in either case with the purpose or intent of obtaining a return on
such investment but without management by Employee of the property or business
to which such investment directly or indirectly relates and without any business
or strategic consultation by Employee with such entity.

     3.  COMPENSATION.

         (a) BASE SALARY. The Company shall pay Employee an annual salary of
Five Hundred Thousand Dollars ($500,000) (the "BASE SALARY"), payable in
accordance with the Company's normal business practices for senior executives
(including tax withholding), but in no event less frequently than monthly.
Employee's Base Salary shall be reviewed at least annually by the Board of
Directors or the Compensation Committee of the Board of Directors (the
"COMPENSATION COMMITTEE") and may be increased but not decreased in its
discretion.

         (b) BONUS. On each annual compensation determination date established
by the Company during the Term, the Company shall review the performance of the
Company and of Employee during the prior year, and the Company may provide
Employee with additional compensation as a bonus if the Board of Directors, or
the Compensation Committee, in its discretion, determines that Employee's
contribution to the Company warrants such additional payment and the Company's
anticipated financial performance for the present period permits such payment.

     4.  BENEFITS.

         (a) MEDICAL/DENTAL INSURANCE. The Employee shall be entitled to
participate in any and all employee benefit plans, including all medical and
dental insurance plans as in effect from time to time for senior executives of
the Company. Such participation shall be subject to (i) the terms of the
applicable plan documents, (ii) generally applicable policies of the Company,
and (iii) the discretion of the Board of Directors, the Compensation Committee
or any

                                        2


administrative or other committee provided for in, or contemplated by, such
plan. Nothing contained in this Agreement shall be construed to create any
obligation on the part of the Company to establish any such plan or to maintain
the effectiveness of any such plan which may be in effect from time to time.

         (b) LIFE INSURANCE; DISABILITY INSURANCE. The Company shall provide
Employee with such life and/or disability insurance as the Company may from time
to time make available to senior executives of the Company.

         (c) EXPENSES. The Company shall promptly reimburse Employee for all
reasonable business expenses incurred by Employee in accordance with the
practices of the Company for senior executives of the Company, as in effect from
time to time.

         (d) VACATION. The Employee shall receive paid vacation annually in
accordance with terms determined for such Employee by the Company, but in no
event shall Employee receive less than four weeks of paid vacation per year.

         (e) STOCK OPTIONS; RESTRICTED STOCK. The Employee shall be entitled to
grants of stock options and restricted stock awards in an amount to be
determined by the Compensation Committee in its discretion under the Boston
Properties, Inc. 1997 Stock Option and Incentive Plan or any other stock option
plan adopted by the Company from time to time (the "STOCK OPTION PLAN").

         (f) DEFERRED COMPENSATION. The Employee shall be entitled to
participate in any deferred compensation plan or arrangement that the Company
may have in place for its senior executives, directors and/or officers.

         (g) AUTOMOBILE. The Company shall provide Employee with the use of a
Company-owned or leased automobile.

         (h) OTHER BENEFITS. The Company shall provide to Employee such other
benefits, including the right to participate in such retirement or pension
plans, as are made generally available to senior executives of the Company from
time to time. Such participation shall be subject to (i) the terms of the
applicable plan documents, (ii) generally applicable policies of the Company,
and (iii) the discretion of the Board of Directors, the Compensation Committee
or any administrative or other committee provided for in, or contemplated by,
such plan.

         (i) TAXATION OF PAYMENTS AND BENEFITS. The Company shall undertake to
make deductions, withholdings and tax reports with respect to payments and
benefits under this Agreement to the extent that it reasonably and in good faith
believes that it is required to make such deductions, withholdings and tax
reports. Payments under this Agreement shall be in amounts net of any such
deductions or withholdings. Nothing in this Agreement shall be construed to
require the Company to make any payments to compensate the Employee for any
adverse tax effect associated with any payments or benefits or for any deduction
or withholding from any payment or benefit.

                                        3


     5.  INDEMNIFICATION. To the full extent permitted by law and subject to the
Company's Certificate of Incorporation and Bylaws, the Company shall indemnify
Employee with respect to any actions commenced against Employee in his capacity
as a director or officer or former director or officer of the Company, or any
affiliate thereof for which he may serve in such capacity, and the Company shall
advance on a timely basis any expenses incurred in defending such actions. The
obligation to indemnify hereunder shall survive the termination of this
Agreement. The Company agrees to use its best efforts to secure and maintain
directors' and officers' liability insurance with respect to Employee.

     6.  COMPANY AUTHORITY/POLICIES. Employee agrees to observe and comply with
the rules and regulations of the Company as adopted by its Board of Directors
respecting the performance of his duties and to carry out and perform orders,
directions and policies communicated to him from time to time by the Board of
Directors.

     7.  RECORDS/NONDISCLOSURE/COMPANY POLICIES.

         (a) GENERAL. All records, financial statements and similar documents
obtained, reviewed or compiled by Employee in the course of the performance by
him of services for the Company, whether or not confidential information or
trade secrets, shall be the exclusive property of the Company. Employee shall
have no rights in such documents upon any termination of this Agreement.

         (b) CONFIDENTIAL INFORMATION. Employee will not disclose to any person
or entity (except as required by applicable law, the rules of the New York Stock
Exchange, or otherwise in connection with the performance of his duties and
responsibilities hereunder), or use for his own benefit or gain, any
confidential information of the Company obtained by him incident to his
employment with the Company. Employee shall take all reasonable steps to
safeguard any confidential information and to protect such confidential
information against disclosure, misuse, loss, or theft. The term "CONFIDENTIAL
INFORMATION" includes, without limitation, financial information, business
plans, prospects, and opportunities which have been discussed or considered by
the management of the Company, but does not include any information which has
become part of the public domain by means other than Employee's non-observance
of his obligations hereunder.

     This Paragraph 7 shall survive the termination of this Agreement.

     8.  TERMINATION/SEVERANCE.

         (a) GENERAL.

             (i)    AT WILL EMPLOYMENT. Employee's employment hereunder is "at
will" and, therefore, may be terminated at any time, with or without cause, at
the option of the Company, subject only to the severance obligations under this
Paragraph 8.

             (ii)   NOTICE OF TERMINATION. Except for termination as a result of
Employee's death as specified in Subparagraph 8(b), any termination of
Employee's employment by the Company or any such termination by Employee shall
be communicated by written Notice of Termination to the other party hereto. For
purposes of this Agreement, a

                                        4


"NOTICE OF TERMINATION" shall mean a notice which shall indicate the specific
termination provision hereunder relied upon by the terminating party.

             (iii)  DATE OF TERMINATION. "DATE OF TERMINATION" shall mean: (A)
if Employee's employment is terminated by his death, the date of his death; (B)
if Employee's employment is terminated on account of disability under
Subparagraph 8(c), the date on which Notice of Termination is given; (C) if
Employee's employment is terminated by the Company for Cause under Subparagraph
8(d), the date on which a Notice of Termination is given; (D) if Employee's
employment is terminated by the Company without Cause under Subparagraph
8(e)(i), thirty (30) days after the date on which a Notice of Termination is
given; and (E) if Employee's employment is terminated by Employee under
Subparagraph 8(e)(ii) or 8(f), thirty (30) days after the date on which a Notice
of Termination is given.

         (b) DEATH. Employee's employment hereunder shall terminate upon his
death. If Employee's employment terminates by reason of his death, the Company
shall, within ninety (90) days of death, pay in a lump sum amount to such person
as Employee shall designate in a notice filed with the Company or, if no such
person is designated, to Employee's estate, Employee's accrued and unpaid Base
Salary to his date of death, plus his accrued and unpaid target bonus prorated
for the number of days actually employed in the then current calendar year. All
unvested stock options and stock-based grants shall immediately vest in
Employee's estate or other legal representatives and become exercisable or
nonforfeitable, and Employee's estate or other legal representatives shall have
such period of time to exercise the stock options as is provided in the Stock
Option Plan and agreements with Employee pursuant thereto. For a period of
eighteen (18) months following the Date of Termination and subject to the
continued copayment of premium amounts by the Employee's spouse and dependents,
the Employee's spouse and dependents shall continue to participate in the
Company's health insurance plan upon the same terms and conditions in effect on
the Date of Termination, PROVIDED, HOWEVER, that the continuation of health
benefits under this Subparagraph shall reduce and count against the rights of
the Employee's spouse and dependents under the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended ("COBRA"). In addition to the foregoing,
any payments to which Employee's spouse, beneficiaries, or estate may be
entitled under any employee benefit plan shall also be paid in accordance with
the terms of such plan or arrangement. Such payments, in the aggregate, shall
fully discharge the Company's obligations hereunder.

         (c) DISABILITY. If, as a result of Employee's incapacity due to
physical or mental illness, Employee shall have been absent from his duties
hereunder on a full-time basis for one hundred eighty (180) calendar days in the
aggregate in any twelve (12) month period, the Company may terminate Employee's
employment hereunder. During any period that Employee fails to perform his
duties hereunder as a result of incapacity due to physical or mental illness,
Employee shall continue to receive his accrued and unpaid Base Salary and
accrued and unpaid target bonus, prorated for the number of days actually
employed in the then current calendar year, until Employee's employment is
terminated due to disability in accordance with this Subparagraph (c) or until
Employee terminates his employment in accordance with Subparagraph (e)(ii) or
(f), if earlier. All unvested stock options and stock-based grants shall
immediately vest and become exercisable or nonforfeitable, and Employee shall
have such period of time to exercise the stock options as is provided in the
Stock Option Plan and

                                        5


agreements with Employee pursuant thereto. For a period of eighteen (18) months
following the Date of Termination and subject to the Employee's continued
copayment of premium amounts, the Employee, Employee's spouse and dependents
shall continue to participate in the Company's health insurance plan upon the
same terms and conditions in effect on the Date of Termination, PROVIDED,
HOWEVER, that the continuation of health benefits under this Subparagraph shall
reduce and count against Employee's rights under COBRA. In addition to the
foregoing, any payments to which Employee may be entitled under any employee
benefit plan shall also be paid in accordance with the terms of such plan or
arrangement. Such payments, in the aggregate, shall fully discharge the
Company's obligations hereunder.

         (d) TERMINATION BY THE COMPANY FOR CAUSE.

             (i)    The Company may terminate Employee's employment hereunder
for Cause. "CAUSE" shall mean: (A) gross negligence or willful misconduct by
Employee in connection with the performance of his material duties hereunder;
(B) a breach by Employee of any of his material duties hereunder (for reasons
other than physical or mental illness) and the failure of Employee to cure such
breach within thirty (30) days after written notice thereof by the Company; (C)
conduct by Employee against the material best interests of the Company or a
material act of common law fraud against the Company or its affiliates or
employees; or (D) indictment of Employee of a felony and such indictment has a
material adverse affect on the interests or reputation of the Company.
Termination for Cause may only occur at a meeting of the Board of Directors
called for this purpose and at which the Employee has the opportunity to be
represented by counsel.

             (ii)   If Employee's employment is terminated by the Company for
Cause, then the Company shall, through the Date of Termination, pay Employee his
accrued and unpaid Base Salary. Thereafter, the Company shall have no further
obligations to Employee except as otherwise provided hereunder; PROVIDED that
any such termination shall not adversely affect or alter Employee's rights under
any employee benefit plan of the Company in which Employee, at the Date of
Termination, has a vested interest, unless otherwise provided in such employee
benefit plan or any agreement or other instrument attendant thereto.
Notwithstanding the foregoing and in addition to whatever other rights or
remedies the Company may have at law or in equity, all stock options and other
stock-based grants held by Employee, whether vested or unvested as of the Date
of Termination, shall immediately expire on the Date of Termination if
Employee's employment is terminated by the Company for Cause.

         (e) TERMINATION BY THE COMPANY WITHOUT CAUSE OR BY EMPLOYEE FOR GOOD
REASON.

             (i)    The Company may terminate Employee's employment hereunder
without Cause if such termination is approved by the Board of Directors. Any
termination by the Company of Employee's employment hereunder which does not (A)
constitute a termination for Cause under Subparagraph (d)(i), (B) result from
the death or disability of the Employee under Subparagraph (b) or (c), or (C)
result from the expiration of the Term shall be deemed a termination without
Cause.

                                        6


             (ii)   The Employee may terminate his employment hereunder for Good
Reason. "GOOD REASON" shall mean: (A) a substantial adverse change, not
consented to by Employee, in the nature or scope of Employee's responsibilities,
authorities, powers, functions, or duties under this Agreement; (B) a breach by
the Company of any of its material obligations hereunder and the failure of the
Company to cure such breach within thirty (30) days after written notice thereof
by Employee; or (C) the involuntary relocation of the Company's offices at which
Employee is principally employed to a location more than fifty (50) miles from
such offices, or the requirement by the Company that Employee be based anywhere
other than the Company's offices at such location on an extended basis, except
for required travel on the Company's business to an extent substantially
consistent with Employee's business travel obligations.

             (iii)  If Employee's employment is terminated by the Company
without Cause or if Employee terminates his employment for Good Reason in
accordance with this Subparagraph (e), then the Company shall, through the Date
of Termination, pay Employee his accrued and unpaid Base Salary and his accrued
and unpaid target bonus prorated for the number of days actually employed in the
then current calendar year. In addition, subject to signing by Employee of a
general release of claims in a form and manner satisfactory to the Company, the
Employee shall be entitled to the following:

                    (A) Salary continuation in an amount (the "SEVERANCE
     AMOUNT") equal to the sum of (x) his annual Base Salary under Subparagraph
     3(a) and (y) the amount of his cash bonus, if any, received in respect of
     the immediately preceding year under Subparagraph 3(b). The Severance
     Amount shall be paid in equal monthly installments over a twelve (12) month
     period;

                    (B) All stock options and other stock-based awards, granted
     to Employee after the Effective Date, in which Employee would have vested
     if he had remained employed for a period of twelve (12) months commencing
     on the Date of Termination shall vest and become exercisable or
     nonforfeitable as of the Date of Termination;

                    (C) Subject to the Employee's continued copayment of premium
     amounts, continued participation for twelve (12) months in the Company's
     health insurance plan upon the same terms and conditions in effect on the
     Date of Termination, PROVIDED, HOWEVER, that the continuation of health
     benefits under this Subparagraph shall reduce and count against Employee's
     rights under COBRA; and

                    (D) Subject to (B) above, all rights and benefits granted or
     in effect with respect to Employee under the Stock Option Plan and
     agreements with Employee pursuant thereto.

         (f) VOLUNTARY TERMINATION BY EMPLOYEE. Employee may terminate his
employment hereunder for any reason, including, but not limited to, Good Reason
in accordance with Subparagraph (e)(ii). If Employee's employment is terminated
by Employee other than for Good Reason, then the Company shall, through the Date
of Termination, pay Employee his accrued and unpaid Base Salary. Thereafter, the
Company shall have no further obligations to

                                        7


Employee except as otherwise expressly provided hereunder; PROVIDED any such
termination shall not adversely affect or alter Employee's rights under any
employee benefit plan of the Company in which Employee, at the Date of
Termination, has a vested interest, unless otherwise provided in such employee
benefit plan or any agreement or other instrument attendant thereto. The vesting
and exercise of any stock options and the forfeitability of any stock-based
grants held by Employee shall be governed by the terms of the Stock Option Plan
and the related agreements between Employee and the Company

         (g) NO MITIGATION. Without regard to the reason for the termination of
Employee's employment hereunder, Employee shall be under no obligation to
mitigate damages with respect to such termination under any circumstances and in
the event Employee is employed or receives income from any other source, there
shall be no offset against the amounts due from the Company hereunder.

     9.  NONCOMPETITION. Because Employee's services to the Company are special
and because Employee has access to the Company's confidential information,
Employee covenants and agrees that during the Employment Period and until the
end of a one-year period following the termination of Employee's employment with
the Company for any reason, Employee shall not, without the prior written
consent of the Company (which shall be authorized by approval of the Board of
Directors of the Company, including the approval of a majority of the
independent Directors of the Company), directly or indirectly:

         (a) engage, participate or assist in, either individually or as an
owner, partner, employee, consultant, director, officer, trustee, or agent of
any business that engages or attempts to engage in, directly or indirectly, the
acquisition, development, construction, operation, management, or leasing of any
commercial real estate property;

         (b) intentionally interfere with, disrupt or attempt to disrupt the
relationship, contractual or otherwise, between the Company or its affiliates
and any tenant, supplier, contractor, lender, employee, or governmental agency
or authority; or

         (c) call upon, compete for, solicit, divert, or take away, or attempt
to divert or take away any of the tenants or employees of the Company or its
affiliates, either for himself or for any other business, operation,
corporation, partnership, association, agency, or other person or entity.

     This Paragraph 9 shall not be interpreted to prevent Employee from engaging
in Minority Interest Passive Investments or any other activity permitted under
Subparagraph 2(b). This Paragraph 9 shall survive the termination of this
Agreement.

     Notwithstanding anything to the contrary herein, the noncompetition
provision of this Paragraph 9 shall not apply if Employee's employment
terminates after a Change in Control (as defined in the Severance Agreement).

     10. CHANGE IN CONTROL PAYMENTS. Notwithstanding anything to the contrary in
the foregoing, in the event that the Employee's employment terminates after a
Change in Control (as defined in the Severance Agreement) under circumstances
that would entitle him to payments

                                        8


and benefits under the Severance Agreement, he shall not be entitled to receive
any payments or benefits under this Agreement.

     11. CONFLICTING AGREEMENTS. Employee hereby represents and warrants that
the execution of this Agreement and the performance of his obligations hereunder
will not breach or be in conflict with any other agreement to which he is a
party or is bound, and that he is not now subject to any covenants against
competition or similar covenants which would affect the performance of his
obligations hereunder.

     12. NOTICES. All notices, requests, demands, and other communications under
this Agreement shall be in writing and shall be deemed duly given (i) if
delivered by hand and receipted for by the party addressee, on the date of such
receipt or (ii) if mailed by domestic certified or registered mail with postage
prepaid, on the third business day after the date postmarked. Address for notice
for the Company is as shown above, or as subsequently modified by written
notice. Address for notice for the Employee is the address shown on the records
of the Company.

     13. INTEGRATION. This Agreement constitutes the entire agreement between
the parties with respect to the subject matter hereof and supersedes all prior
agreements between the parties with respect to any related subject matter,
PROVIDED, HOWEVER, that the Director Indemnification Agreement and Severance
Agreement, each as amended from time to time, shall remain in full force and
effect hereafter.

     14. ASSIGNMENT; SUCCESSORS AND ASSIGNS, ETC. Neither the Company nor the
Employee may make any assignment of this Agreement or any interest herein, by
operation of law or otherwise, without the prior written consent of the other
party; PROVIDED that the Company may assign its rights under this Agreement
without the consent of the Employee in the event that the Company shall effect a
reorganization, consolidate with or merge into any other corporation,
partnership, organization or other entity, or transfer all or substantially all
of its properties or assets to any other corporation, partnership, organization
or other entity. This Agreement shall inure to the benefit of and be binding
upon the Company and the Employee, their respective successors, executors,
administrators, heirs and permitted assigns.

     15. MISCELLANEOUS. Headings herein are for convenience of reference only
and shall not define, limit or interpret the contents hereof.

     16. AMENDMENT. This Agreement may be amended, modified or supplemented by
the mutual consent of the parties in writing, but no oral amendment,
modification or supplement shall be effective.

     17. ARBITRATION; OTHER DISPUTES. Any dispute or controversy arising under
or in connection with this Agreement shall be settled exclusively by arbitration
in Boston, Massachusetts, in accordance with the rules of the American
Arbitration Association then in effect. Judgment may be entered in any court
having jurisdiction. Notwithstanding the above, the Company shall be entitled to
seek a restraining order or injunction in any court of competent jurisdiction to
prevent any continuation of any violation of Paragraph 7 or 9 hereof. In the
event that the Company terminates Employee's employment for Cause under
Subparagraph 8(d)(i) and

                                        9


Employee contends that Cause did not exist, then the Company's only obligation
shall be to submit such claim to arbitration and the only issue before the
arbitrator will be whether Employee was in fact terminated for Cause. If the
arbitrator determines that Employee was not terminated for Cause by the Company,
then the only remedies that the arbitrator may award are (i) the Severance
Amount specified in Subparagraph 8(e)(iii)(A), (ii) the costs of arbitration,
(iii) Employee's reasonable attorneys' fees, (iv) the additional vesting of
Employee's stock options and other stock-based awards in accordance with
Subparagraph 8(e)(iii)(B), and (v) the continued participation in the Company's
health insurance plan in accordance with Subparagraph 8(e)(iii)(C). If the
arbitrator finds that Employee was terminated for Cause, the arbitrator will be
without authority to award Employee anything, and the parties will each be
responsible for their own attorneys' fees, and they will divide the costs of
arbitration equally. Furthermore, should a dispute occur concerning Employee's
mental or physical capacity as described in Subparagraph 8(c), a doctor selected
by Employee and a doctor selected by the Company shall be entitled to examine
Employee. If the opinion of the Company's doctor and Employee's doctor conflict,
the Company's doctor and Employee's doctor shall together agree upon a third
doctor, whose opinion shall be binding. This Paragraph 17 shall survive the
termination of this Agreement.

     18. LITIGATION AND REGULATORY COOPERATION. During and after Employee's
employment, Employee shall reasonably cooperate with the Company in the defense
or prosecution of any claims or actions now in existence or which may be brought
in the future against or on behalf of the Company which relate to events or
occurrences that transpired while Employee was employed by the Company; PROVIDED
that such cooperation shall not materially and adversely affect Employee or
expose Employee to an increased probability of civil or criminal litigation.
Employee's cooperation in connection with such claims or actions shall include,
without limitation, being available to meet with counsel to prepare for
discovery or trial and to act as a witness on behalf of the Company at mutually
convenient times. During and after Employee's employment, Employee also shall
cooperate fully with the Company in connection with any investigation or review
of any federal, state or local regulatory authority as any such investigation or
review relates to events or occurrences that transpired while Employee was
employed by the Company. The Company shall also provide Employee with
compensation on an hourly basis calculated at his final base compensation rate
for requested litigation and regulatory cooperation that occurs after his
termination of employment, and reimburse Employee for all costs and expenses
incurred in connection with his performance under this Paragraph 18, including,
without limitation, reasonable attorneys' fees and costs.

     19. SEVERABILITY. If any provision of this Agreement shall to any extent be
held void or unenforceable (as to duration, scope, activity, subject or
otherwise) by a court of competent jurisdiction, such provision shall be deemed
to be modified so as to constitute a provision conforming as nearly as possible
to the original provision while still remaining valid and enforceable. In such
event, the remainder of this Agreement (or the application of such provision to
persons or circumstances other than those in respect of which it is deemed to be
void or unenforceable) shall not be affected thereby. Each other provision of
this Agreement, unless specifically conditioned on the voided aspect of such
provision, shall remain valid and enforceable to the fullest extent permitted by
law; any other provisions of this Agreement that are specifically conditioned on
the voided aspect of such invalid provision shall also be deemed

                                       10


to be modified so as to constitute a provision conforming as nearly as possible
to the original provision while still remaining valid and enforceable to the
fullest extent permitted by law.

     20. GOVERNING LAW. This Agreement shall be construed and regulated in all
respects under the laws of the State of Delaware.

     21. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be taken to be
an original; but such counterparts shall together constitute one and the same
document.

                                       11


     IN WITNESS WHEREOF, this Agreement is entered into as of the date and year
first above written.

                                             BOSTON PROPERTIES, INC.


                                             By: /s/ Robert E. Burke
                                                 -------------------------------
                                                 Name: Robert E. Burke
                                                 Title: Executive Vice President
                                                        of Operations


                                             /s/ Edward H. Linde
                                             -----------------------------------
                                             Edward H. Linde

                                       12



                                                                    EXHIBIT 10.9

                              AMENDED AND RESTATED
                              EMPLOYMENT AGREEMENT

     THIS AGREEMENT (the "AGREEMENT") is made as of the 29th day of November,
2002 (the "EFFECTIVE DATE"), by and between Robert E. Burke (the "EMPLOYEE") and
Boston Properties, Inc., a Delaware corporation, with its principal executive
office located at 111 Huntington Avenue, Suite 300, Boston, Massachusetts
02199-7610 (together with its subsidiaries, the "COMPANY").

                                WITNESSETH THAT:

     WHEREAS, the Company and the Employee have entered into that certain
Employment Agreement, dated as of June 23, 1997, which agreement the parties
desire to be amended, restated and superseded in its entirety by this Agreement;

     WHEREAS, the Company has determined that it is in its best interest to
continue the employment of the Employee on the terms hereinafter set forth;

     WHEREAS, the Employee wishes to be so employed pursuant to the terms
hereinafter set forth;

     WHEREAS, the Company has adopted that certain Senior Executive Severance
Plan, effective as of July 30, 1998 (the "SEVERANCE PLAN"), as may be amended
from time to time, and which the parties desire to remain in full force and
effect after the date hereof;

     NOW, THEREFORE, in consideration of the mutual covenants and premises set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Employee
hereby agree as follows:

     1.  TERM. Subject to the provisions of Paragraph 8, the term of employment
pursuant to this Agreement (the "TERM") shall be two (2) years from the
Effective Date and shall be renewed automatically for periods of one (1) year
commencing at each anniversary of the Effective Date, unless written notice is
given by either party to the other not less than ninety (90) days prior to any
such anniversary of such party's election not to extend the Term.

     2.  EMPLOYMENT; DUTIES; LOCATION.

         (a) Employee shall initially serve as an officer of the Company with
the title Executive Vice President for Operations. Employee's duties and
authority shall be commensurate with his title and position with the Company.
The Employee shall report directly to the Chief Executive Officer and/or
President and shall serve the Company in such other capacity or capacities as
the Employee may be requested to serve by the Board of Directors of the Company
(the "BOARD OF DIRECTORS"). In such capacity or capacities, the Employee shall
perform such services and duties in connection with the business, affairs and
operations of the Company as may be assigned or delegated to the Employee from
time to time by or under the authority of the Board of Directors. The Employee
shall be principally located at the Company's Boston office.



         (b) Employee agrees to his employment as described in this Paragraph 2
and agrees to devote substantially ALL of his working time and efforts to the
performance of his duties hereunder, except as otherwise approved by the Board
of Directors. Notwithstanding the foregoing, nothing herein shall be interpreted
to preclude Employee from (i) engaging in Minority Interest Passive Investments
(as defined below), including Minority Interest Passive Investments in, or
relating to the ownership, development, operation, management, or leasing of,
commercial real estate properties or (ii) participating as an officer or
director of, or advisor to, any charitable or other tax exempt organization;
PROVIDED that such activities and related duties and pursuits do not restrict
Employee's ability to fulfill his obligations as an officer and employee of the
Company as set forth herein.

     Engaging in a "MINORITY INTEREST PASSIVE INVESTMENT" means acquiring,
holding, and exercising the voting rights associated with an investment made
through (i) the purchase of securities (including partnership interests) that
represent a non-controlling, minority interest in an entity or (ii) the lending
of money, in either case with the purpose or intent of obtaining a return on
such investment but without management by Employee of the property or business
to which such investment directly or indirectly relates and without any business
or strategic consultation by Employee with such entity.

     3.  COMPENSATION.

         (a) BASE SALARY. The Company shall pay Employee an annual salary of
Three Hundred Eighty-Five Thousand Dollars ($385,000) (the "BASE SALARY"),
payable in accordance with the Company's normal business practices for senior
executives (including tax withholding), but in no event less frequently than
monthly. Employee's Base Salary shall be reviewed at least annually by the Board
of Directors or the Compensation Committee of the Board of Directors (the
"COMPENSATION COMMITTEE") and may be increased but not decreased in its
discretion.

         (b) BONUS. On each annual compensation determination date established
by the Company during the Term, the Company shall review the performance of the
Company and of Employee during the prior year, and the Company may provide
Employee with additional compensation as a bonus if the Board of Directors, or
the Compensation Committee, in its discretion, determines that Employee's
contribution to the Company warrants such additional payment and the Company's
anticipated financial performance for the present period permits such payment.

     4.  BENEFITS.

         (a) MEDICAL/DENTAL INSURANCE. Employee shall be entitled to participate
in any and all employee benefit plans, including all medical and dental
insurance plans as in effect from time to time for senior executives of the
Company. Such participation shall be subject to (i) the terms of the applicable
plan documents, (ii) generally applicable policies of the Company, and (iii) the
discretion of the Board of Directors, the Compensation Committee or any
administrative or other committee provided for in, or contemplated by, such
plan. Nothing contained in this Agreement shall be construed to create any
obligation on the part of the Company to establish any such plan or to maintain
the effectiveness of any such plan which may be in effect from time to time.

                                        2


         (b) LIFE INSURANCE/DISABILITY INSURANCE. The Company shall provide
Employee with such life and/or disability insurance as the Company may from time
to time make available to senior executives of the Company.

         (c) EXPENSES. The Company shall promptly reimburse Employee for all
reasonable business expenses incurred by Employee in accordance with the
practices of the Company for senior executives of the Company, as in effect from
time to time.

         (d) VACATION. Employee shall receive paid vacation annually in
accordance with terms determined for such Employee by the Company, but in no
event shall Employee receive less than four weeks of paid vacation per year.

         (e) STOCK OPTIONS; RESTRICTED STOCK. Employee shall be entitled to
grants of stock options and restricted stock awards in an amount to be
determined by the Compensation Committee in its discretion under the Boston
Properties, Inc. 1997 Stock Option and Incentive Plan or any other stock option
plan adopted by the Company from time to time (the "STOCK OPTION PLAN").

         (f) DEFERRED COMPENSATION. Employee shall be entitled to participate in
any deferred compensation plan or arrangement that the Company may have in place
for its senior executives and/or officers.

         (g) AUTOMOBILE. The Company shall provide Employee with an automobile
allowance of Seven Hundred Fifty Dollars ($750) per month, such amount to be
increased from time to time in the Company's sole discretion and to be paid to
Employee no less frequently than monthly.

         (h) OTHER BENEFITS. The Company shall provide to Employee such other
benefits, including the right to participate in such retirement or pension
plans, as are made generally available to senior executives of the Company from
time to time. Such participation shall be subject to (i) the terms of the
applicable plan documents, (ii) generally applicable policies of the Company,
and (iii) the discretion of the Board of Directors, the Compensation Committee,
or any administrative or other committee provided for in, or contemplated by,
such plan.

         (i) TAXATION OF PAYMENTS AND BENEFITS. The Company shall undertake to
make deductions, withholdings and tax reports with respect to payments and
benefits under this Agreement to the extent that it reasonably and in good faith
believes that it is required to make such deductions, withholdings and tax
reports. Payments under this Agreement shall be in amounts net of any such
deductions or withholdings. Nothing in this Agreement shall be construed to
require the Company to make any payments to compensate the Employee for any
adverse tax effect associated with any payments or benefits or for any deduction
or withholding from any payment or benefit.

     5.  INDEMNIFICATION. To the full extent permitted by law and subject to the
Company's Certificate of Incorporation and Bylaws, the Company shall indemnify
Employee with respect to any actions commenced against Employee in his capacity
as a director or officer or former director or officer of the Company, or any
affiliate thereof for which he may serve in

                                        3


such capacity, and the Company shall advance on a timely basis any expenses
incurred in defending such actions. The obligation to indemnify hereunder shall
survive the termination of this Agreement. The Company agrees to use its best
efforts to secure and maintain directors' and officers' liability insurance with
respect to Employee.

     6.  COMPANY AUTHORITY/POLICIES. Employee agrees to observe and comply with
the rules and regulations of the Company as adopted by its Board of Directors
respecting the performance of his duties and to carry out and perform orders,
directions and policies communicated to him from time to time by the Board of
Directors.

     7.  RECORDS/NONDISCLOSURE/COMPANY POLICIES.

         (a) GENERAL. All records, financial statements and similar documents
obtained, reviewed or compiled by Employee in the course of the performance by
him of services for the Company, whether or not confidential information or
trade secrets, shall be the exclusive property of the Company. Employee shall
have no rights in such documents upon any termination of this Agreement.

         (b) CONFIDENTIAL INFORMATION. Employee will not disclose to any person
or entity (except as required by applicable law, the rules of the New York Stock
Exchange, or otherwise in connection with the performance of his duties and
responsibilities hereunder), or use for his own benefit or gain, any
confidential information of the Company obtained by him incident to his
employment with the Company. Employee shall take all reasonable steps to
safeguard any confidential information and to protect such confidential
information against disclosure, misuse, loss, or theft. The term "CONFIDENTIAL
INFORMATION" includes, without limitation, financial information, business
plans, prospects, and opportunities which have been discussed or considered by
the management of the Company, but does not include any information which has
become part of the public domain by means other than Employee's non-observance
of his obligations hereunder.

     This Paragraph 7 shall survive the termination of this Agreement.

     8.  TERMINATION/SEVERANCE.

         (a) GENERAL.

             (i)    AT WILL EMPLOYMENT. Employee's employment hereunder is "at
will" and, therefore, may be terminated at any time, with or without cause, at
the option of the Company, subject only to the severance obligations under this
Paragraph 8.

             (ii)   NOTICE OF TERMINATION. Except for termination as a result of
Employee's death as specified in Subparagraph 8(b), any termination of
Employee's employment by the Company or any such termination by Employee shall
be communicated by written Notice of Termination to the other party hereto. For
purposes of this Agreement, a "NOTICE OF TERMINATION" shall mean a notice which
shall indicate the specific termination provision hereunder relied upon by the
terminating party.

                                        4


             (iii)  DATE OF TERMINATION. "DATE OF TERMINATION" shall mean: (A)
if Employee's employment is terminated by his death, the date of his death; (B)
if Employee's employment is terminated on account of disability under
Subparagraph 8(c), the date on which Notice of Termination is given; (C) if
Employee's employment is terminated by the Company for Cause under Subparagraph
8(d), the date on which a Notice of Termination is given; (D) if Employee's
employment is terminated by the Company without Cause under Subparagraph
8(e)(i), thirty (30) days after the date on which a Notice of Termination is
given; and (E) if Employee's employment is terminated by Employee under
Subparagraph 8(e)(ii) or 8(f), thirty (30) days after the date on which a Notice
of Termination is given.

         (b) DEATH. Employee's employment hereunder shall terminate upon his
death. If Employee's employment terminates by reason of his death, the Company
shall, within ninety (90) days of death, pay in a lump sum amount to such person
as Employee shall designate in a notice filed with the Company or, if no such
person is designated, to Employee's estate, Employee's accrued and unpaid Base
Salary to his date of death, plus his accrued and unpaid target bonus, prorated
for the number of days actually employed in the then current calendar year. All
unvested stock options and stock-based grants shall immediately vest in
Employee's estate or other legal representatives and become exercisable or
nonforfeitable, and Employee's estate or other legal representatives shall have
such period of time to exercise the stock options as is provided in the Stock
Option Plan and agreements with Employee pursuant thereto. For a period of
eighteen (18) months following the Date of Termination, and subject to the
continued copayment of premium amounts by the Employee's spouse and dependents,
the Employee's spouse and dependents shall continue to participate in the
Company's health insurance plan upon the same terms and conditions in effect on
the Date of Termination, PROVIDED, HOWEVER, that the continuation of health
benefits under this Subparagraph shall reduce and count against the rights of
the Employee's spouse and dependents under the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended ("COBRA"). In addition to the foregoing,
any payments to which Employee's spouse, beneficiaries, or estate may be
entitled under any employee benefit plan shall also be paid in accordance with
the terms of such plan or arrangement. Such payments, in the aggregate, shall
fully discharge the Company's obligations hereunder.

         (c) DISABILITY. If, as a result of Employee's incapacity due to
physical or mental illness, Employee shall have been absent from his duties
hereunder on a full-time basis for one hundred eighty (180) calendar days in the
aggregate in any twelve (12) month period, the Company may terminate Employee's
employment hereunder. During any period that Employee fails to perform his
duties hereunder as a result of incapacity due to physical or mental illness,
Employee shall continue to receive his accrued and unpaid Base Salary and
accrued and unpaid target bonus, prorated for the number of days actually
employed in the then current calendar year, until Employee's employment is
terminated due to disability in accordance with this Subparagraph (c) or until
Employee terminates his employment in accordance with Subparagraph (e)(ii) or
(f), if earlier. All unvested stock options and stock-based grants shall
immediately vest and become exercisable or nonforfeitable, and Employee shall
have such period of time to exercise the stock options as is provided in the
Stock Option Plan and agreements with Employee pursuant thereto. For a period of
eighteen (18) months following the Date of Termination and subject to the
Employee's continued copayment of premium amounts, the Employee, Employee's
spouse and dependents shall continue to participate in the Company's

                                        5


health insurance plan upon the same terms and conditions in effect on the Date
of Termination, PROVIDED, HOWEVER, that the continuation of health benefits
under this Subparagraph shall reduce and count against Employee's rights under
COBRA. In addition to the foregoing, any payments to which Employee may be
entitled under any employee benefit plan shall also be paid in accordance with
the terms of such plan or arrangement. Such payments, in the aggregate, shall
fully discharge the Company's obligations hereunder.

         (d) TERMINATION BY THE COMPANY FOR CAUSE.

             (i)    The Company may terminate Employee's employment hereunder
for Cause. "CAUSE" shall mean: (A) gross negligence or willful misconduct by
Employee in connection with the performance of his material duties hereunder;
(B) a breach by Employee of any of his material duties hereunder (for reasons
other than physical or mental illness) and the failure of Employee to cure such
breach within thirty (30) days after written notice thereof by the Company; (C)
conduct by Employee against the material best interests of the Company or a
material act of common law fraud against the Company or its affiliates or
employees; or (D) indictment of Employee of a felony and such indictment has a
material adverse affect on the interests or reputation of the Company.

             (ii)   If Employee's employment is terminated by the Company for
Cause, then the Company shall, through the Date of Termination, pay Employee his
accrued and unpaid Base Salary. Thereafter, the Company shall have no further
obligations to Employee except as otherwise provided hereunder; PROVIDED that
any such termination shall not adversely affect or alter Employee's rights under
any employee benefit plan of the Company in which Employee, at the Date of
Termination, has a vested interest, unless otherwise provided in such employee
benefit plan or any agreement or other instrument attendant thereto.
Notwithstanding the foregoing and in addition to whatever other rights or
remedies the Company may have at law or in equity, all stock options and other
stock-based grants held by Employee, whether vested or unvested as of the Date
of Termination, shall immediately expire on the Date of Termination if
Employee's employment is terminated by the Company for Cause.

         (e) TERMINATION BY THE COMPANY WITHOUT CAUSE OR BY EMPLOYEE FOR GOOD
REASON.

             (i)    The Company may terminate Employee's employment hereunder
without Cause if such termination is approved by the Chief Executive Officer or
Chairman of the Company. Any termination by the Company of Employee's employment
hereunder which does not (A) constitute a termination for Cause under
Subparagraph (d)(i), (B) result from the death or disability of the Employee
under Subparagraph (b) or (c), or (C) result from the expiration of the Term,
shall be deemed a termination without Cause.

             (ii)   Employee may terminate his employment hereunder for Good
Reason. "GOOD REASON" shall mean: (A) a substantial adverse change, not
consented to by Employee, in the nature or scope of Employee's responsibilities,
authorities, powers, functions, or duties under this Agreement; (B) a breach by
the Company of any of its material obligations hereunder and the failure of the
Company to cure such breach within thirty (30) days after written notice thereof
by Employee; or (C) the involuntary relocation of the Company's offices

                                        6


at which Employee is principally employed to a location more than fifty (50)
miles from such offices, or the requirement by the Company that Employee be
based anywhere other than the Company's offices at such location on an extended
basis, except for required travel on the Company's business to an extent
substantially consistent with Employee's business travel obligations.

             (iii)  If Employee's employment is terminated by the Company
without Cause or if Employee terminates his employment for Good Reason in
accordance with this Subparagraph (e), then the Company shall, through the Date
of Termination, pay Employee his accrued and unpaid Base Salary and his accrued
and unpaid target bonus prorated for the number of days actually employed in the
then current calendar year. In addition, subject to signing by Employee of a
general release of claims in a form and manner satisfactory to the Company, the
Employee shall be entitled to the following:

                    (A) Salary continuation in an amount (the "SEVERANCE
AMOUNT") equal to the sum of (x) his annual Base Salary under Subparagraph 3(a)
and (y) the amount of his cash bonus, if any, received in respect of the
immediately preceding year under Subparagraph 3(b). The Severance Amount shall
be paid in equal monthly installments over a twelve (12) month period;

                    (B) All stock options and other stock-based awards, granted
to Employee after the Effective Date, in which Employee would have vested if he
had remained employed for a period of twelve (12) months commencing on the Date
of Termination, shall vest and become exercisable or nonforfeitable as of the
Date of Termination;

                    (C) Subject to the Employee's continued copayment of premium
amounts, continued participation for twelve (12) months in the Company's health
insurance plan upon the same terms and conditions in effect on the Date of
Termination, PROVIDED, HOWEVER, that the continuation of health benefits under
this Subparagraph shall reduce and count against Employee's rights under COBRA;
and

                    (D) Subject to (B) above, all rights and benefits granted or
in effect with respect to Employee under the Stock Option Plan and agreements
with Employee pursuant thereto.

         (f) VOLUNTARY TERMINATION BY EMPLOYEE. Employee may terminate his
employment hereunder for any reason, including, but not limited to, Good Reason
in accordance with Subparagraph (e)(ii). If Employee's employment is terminated
by Employee other than for Good Reason, then the Company shall, through the Date
of Termination, pay Employee his accrued and unpaid Base Salary. Thereafter, the
Company shall have no further obligations to Employee except as otherwise
expressly provided hereunder; PROVIDED any such termination shall not adversely
affect or alter Employee's rights under any employee benefit plan of the Company
in which Employee, at the Date of Termination, has a vested interest, unless
otherwise provided in such employee benefit plan or any agreement or other
instrument attendant thereto. The vesting and exercise of any stock options and
the forfeitability of any stock-based grants held by Employee shall be governed
by the terms of the Stock Option Plan and the related agreements between
Employee and the Company

                                        7


         (g) NO MITIGATION. Without regard to the reason for the termination of
Employee's employment hereunder, Employee shall be under no obligation to
mitigate damages with respect to such termination under any circumstances and in
the event Employee is employed or receives income from any other source, there
shall be no offset against the amounts due from the Company hereunder.

     9.  NONCOMPETITION. Because Employee's services to the Company are special
and because Employee has access to the Company's confidential information,
Employee covenants and agrees that during the Employment Period and until the
end of a one-year period following the termination of Employee's employment with
the Company for any reason, Employee shall not, without the prior written
consent of the Company (which shall be authorized by approval of the Board of
Directors of the Company, including the approval of a majority of the
independent Directors of the Company), directly or indirectly:

         (a) engage, participate or assist in, either individually or as an
owner, partner, employee, consultant, director, officer, trustee, or agent of
any business that engages or attempts to engage in, directly or indirectly, the
acquisition, development, construction, operation, management, or leasing of any
commercial real estate property in any of the Company's Markets (as hereinafter
defined) at the time of Employee's termination of employment;

         (b) intentionally interfere with, disrupt or attempt to disrupt the
relationship, contractual or otherwise, between the Company or its affiliates
and any tenant, supplier, contractor, lender, employee, or governmental agency
or authority; or

         (c) call upon, compete for, solicit, divert, or take away, or attempt
to divert or take away any of the tenants or employees of the Company or its
affiliates, either for himself or for any other business, operation,
corporation, partnership, association, agency, or other person or entity.

     "MARKET" as used herein means an area covering a 25 mile radius around (x)
any property or land owned by the Company, under development by the Company or
with respect to which the Company has an agreement or option to acquire a
property, development or land or (y) any property or development for which the
Company provides third party development or management services; PROVIDED that
for any such property, development or land located in New York City, no such
radial area shall extend beyond New York City.

     This Paragraph 9 shall not be interpreted to prevent Employee from engaging
in Minority Interest Passive Investments or any other activity permitted under
Subparagraph 2(b). This Paragraph 9 shall survive the termination of this
Agreement.

     Notwithstanding anything to the contrary herein, the noncompetition
provision of this Paragraph 9 shall not apply if Employee's employment
terminates after a Change in Control (as defined in the Severance Plan).

     10. CHANGE IN CONTROL PAYMENTS. Notwithstanding anything to the contrary in
the foregoing, in the event that the Employee's employment terminates after a
Change in Control (as defined in the Severance Plan) under circumstances that
would entitle him to payments and

                                        8


benefits under the Severance Plan, he shall not be entitled to receive any
payments or benefits under this Agreement.

     11. CONFLICTING AGREEMENTS. Employee hereby represents and warrants that
the execution of this Agreement and the performance of his obligations hereunder
will not breach or be in conflict with any other agreement to which he is a
party or is bound, and that he is not now subject to any covenants against
competition or similar covenants which would affect the performance of his
obligations hereunder.

     12. NOTICES. All notices, requests, demands, and other communications under
this Agreement shall be in writing and shall be deemed duly given (i) if
delivered by hand and receipted for by the party addressee, on the date of such
receipt or (ii) if mailed by domestic certified or registered mail with postage
prepaid, on the third business day after the date postmarked. Address for notice
for the Company is as shown above, or as subsequently modified by written
notice. Address for notice for the Employee is the address shown on the records
of the Company.

     13. INTEGRATION. This Agreement constitutes the entire agreement between
the parties with respect to the subject matter hereof and supersedes all prior
agreements between the parties with respect to any related subject matter,
provided, however, that the Severance Plan, as amended from time to time, shall
remain in full force and effect hereafter.

     14. ASSIGNMENT; SUCCESSORS AND ASSIGNS, ETC. Neither the Company nor the
Employee may make any assignment of this Agreement or any interest herein, by
operation of law or otherwise, without the prior written consent of the other
party; provided that the Company may assign its rights under this Agreement
without the consent of the Employee in the event that the Company shall effect a
reorganization, consolidate with or merge into any other corporation,
partnership, organization or other entity, or transfer all or substantially all
of its properties or assets to any other corporation, partnership, organization
or other entity. This Agreement shall inure to the benefit of and be binding
upon the Company and the Employee, their respective successors, executors,
administrators, heirs and permitted assigns.

     15. MISCELLANEOUS. Headings herein are for convenience of reference only
and shall not define, limit or interpret the contents hereof.

     16. AMENDMENT. This Agreement may be amended, modified or supplemented by
the mutual consent of the parties in writing, but no oral amendment,
modification or supplement shall be effective.

     17. ARBITRATION; OTHER DISPUTES. Any dispute or controversy arising under
or in connection with this Agreement shall be settled exclusively by arbitration
in Boston, Massachusetts, in accordance with the rules of the American
Arbitration Association then in effect. Judgment may be entered in any court
having jurisdiction. Notwithstanding the above, the Company shall be entitled to
seek a restraining order or injunction in any court of competent jurisdiction to
prevent any continuation of any violation of Paragraph 7 or 9 hereof. In the
event that the Company terminates Employee's employment for Cause under
Subparagraph 8(d)(i) and Employee contends that Cause did not exist, then the
Company's only obligation shall be to

                                        9


submit such claim to arbitration and the only issue before the arbitrator will
be whether Employee was in fact terminated for Cause. If the arbitrator
determines that Employee was not terminated for Cause by the Company, then the
only remedies that the arbitrator may award are (i) the Severance Amount
specified in Subparagraph 8(e)(iii)(A), (ii) the costs of arbitration, (iii)
Employee's reasonable attorneys' fees, (iv) the additional vesting of Employee's
stock options and other stock-based awards in accordance with Subparagraph
8(e)(iii)(B), and (v) the continued participation in the Company's health
insurance plan in accordance with Subparagraph 8(e)(iii)(C). If the arbitrator
finds that Employee was terminated for Cause, the arbitrator will be without
authority to award Employee anything, and the parties will each be responsible
for their own attorneys' fees, and they will divide the costs of arbitration
equally. Furthermore, should a dispute occur concerning Employee's mental or
physical capacity as described in Subparagraph 8(c), a doctor selected by
Employee and a doctor selected by the Company shall be entitled to examine
Employee. If the opinion of the Company's doctor and Employee's doctor conflict,
the Company's doctor and Employee's doctor shall together agree upon a third
doctor, whose opinion shall be binding. This Paragraph 17 shall survive the
termination of this Agreement.

     18. LITIGATION AND REGULATORY COOPERATION. During and after Employee's
employment, Employee shall reasonably cooperate with the Company in the defense
or prosecution of any claims or actions now in existence or which may be brought
in the future against or on behalf of the Company which relate to events or
occurrences that transpired while Employee was employed by the Company; provided
that such cooperation shall not materially and adversely affect Employee or
expose Employee to an increased probability of civil or criminal litigation.
Employee's cooperation in connection with such claims or actions shall include,
without limitation, being available to meet with counsel to prepare for
discovery or trial and to act as a witness on behalf of the Company at mutually
convenient times. During and after Employee's employment, Employee also shall
cooperate fully with the Company in connection with any investigation or review
of any federal, state or local regulatory authority as any such investigation or
review relates to events or occurrences that transpired while Employee was
employed by the Company. The Company shall also provide Employee with
compensation on an hourly basis calculated at his final base compensation rate
for requested litigation and regulatory cooperation that occurs after his
termination of employment, and reimburse Employee for all costs and expenses
incurred in connection with his performance under this Paragraph 18, including,
without limitation, reasonable attorneys' fees and costs.

     19. SEVERABILITY. If any provision of this Agreement shall to any extent be
held void or unenforceable (as to duration, scope, activity, subject or
otherwise) by a court of competent jurisdiction, such provision shall be deemed
to be modified so as to constitute a provision conforming as nearly as possible
to the original provision while still remaining valid and enforceable. In such
event, the remainder of this Agreement (or the application of such provision to
persons or circumstances other than those in respect of which it is deemed to be
void or unenforceable) shall not be affected thereby. Each other provision of
this Agreement, unless specifically conditioned on the voided aspect of such
provision, shall remain valid and enforceable to the fullest extent permitted by
law; any other provisions of this Agreement that are specifically conditioned on
the voided aspect of such invalid provision shall also be deemed to be modified
so as to constitute a provision conforming as nearly as possible to the original
provision while still remaining valid and enforceable to the fullest extent
permitted by law.

                                       10


     20. GOVERNING LAW. This Agreement shall be construed and regulated in all
respects under the laws of the State of Delaware.

     21. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be taken to be
an original; but such counterparts shall together constitute one and the same
document.

                                       11


     IN WITNESS WHEREOF, this Agreement is entered into as of the date and year
first above written.

                                             BOSTON PROPERTIES, INC.


                                             By: /s/ Edward H. Linde
                                                 -------------------------------
                                                 Name:  Edward H. Linde
                                                 Title: President and
                                                        Chief Executive Officer


                                             /s/ Robert E. Burke
                                             -----------------------------------
                                             Robert E. Burke

                                       12



                                                                   EXHIBIT 10.10

                              EMPLOYMENT AGREEMENT

     THIS AGREEMENT (the "AGREEMENT") is made as of the 29th day of November,
2002 (the "EFFECTIVE DATE"), by and between Bryan J. Koop (the "EMPLOYEE") and
Boston Properties, Inc., a Delaware corporation, with its principal executive
office located at 111 Huntington Avenue, Suite 300, Boston, Massachusetts
02199-7610 (together with its subsidiaries, the "COMPANY").

                                WITNESSETH THAT:

     WHEREAS, the Company has determined that it is in its best interest to
continue the employment of the Employee on the terms hereinafter set forth;

     WHEREAS, the Employee wishes to be so employed pursuant to the terms
hereinafter set forth;

     WHEREAS, the Company has adopted that certain Senior Executive Severance
Plan, effective as of July 30, 1998 (the "SEVERANCE PLAN"), as may be amended
from time to time, and which the parties desire to remain in full force and
effect after the date hereof;

     NOW, THEREFORE, in consideration of the mutual covenants and premises set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Employee
hereby agree as follows:

     1.  TERM. Subject to the provisions of Paragraph 8, the term of employment
pursuant to this Agreement (the "TERM") shall be two (2) years from the
Effective Date and shall be renewed automatically for periods of one (1) year
commencing at each anniversary of the Effective Date, unless written notice is
given by either party to the other not less than ninety (90) days prior to any
such anniversary of such party's election not to extend the Term.

     2.  EMPLOYMENT; DUTIES; LOCATION.

         (a) Employee shall initially serve as an officer of the Company with
the title Senior Vice President, Regional Manager. Employee's duties and
authority shall be commensurate with his title and position with the Company.
The Employee shall report directly to the Executive Vice President for Operation
and shall serve the Company in such other capacity or capacities as the Employee
may be requested to serve by the Board of Directors of the Company (the "BOARD
OF DIRECTORS"). In such capacity or capacities, the Employee shall perform such
services and duties in connection with the business, affairs and operations of
the Company as may be assigned or delegated to the Employee from time to time by
or under the authority of the Board of Directors. The Employee shall be
principally located at the Company's Boston office.

         (b) Employee agrees to his employment as described in this Paragraph 2
and agrees to devote substantially ALL of his working time and efforts to the
performance of his duties hereunder, except as otherwise approved by the Board
of Directors. Notwithstanding the foregoing, nothing herein shall be interpreted
to preclude Employee from (i) engaging in



Minority Interest Passive Investments (as defined below), including Minority
Interest Passive Investments in, or relating to the ownership, development,
operation, management, or leasing of, commercial real estate properties or (ii)
participating as an officer or director of, or advisor to, any charitable or
other tax exempt organization; PROVIDED that such activities and related duties
and pursuits do not restrict Employee's ability to fulfill his obligations as an
officer and employee of the Company as set forth herein.

     Engaging in a "MINORITY INTEREST PASSIVE INVESTMENT" means acquiring,
holding, and exercising the voting rights associated with an investment made
through (i) the purchase of securities (including partnership interests) that
represent a non-controlling, minority interest in an entity or (ii) the lending
of money, in either case with the purpose or intent of obtaining a return on
such investment but without management by Employee of the property or business
to which such investment directly or indirectly relates and without any business
or strategic consultation by Employee with such entity.

     3.  COMPENSATION.

         (a) BASE SALARY. The Company shall pay Employee an annual salary of Two
Hundred Sixty-Five Thousand Dollars ($265,000) (the "BASE SALARY"), payable in
accordance with the Company's normal business practices for senior executives
(including tax withholding), but in no event less frequently than monthly.
Employee's Base Salary shall be reviewed at least annually by the Board of
Directors or the Compensation Committee of the Board of Directors (the
"COMPENSATION COMMITTEE") and may be increased but not decreased in its
discretion.

         (b) BONUS. On each annual compensation determination date established
by the Company during the Term, the Company shall review the performance of the
Company and of Employee during the prior year, and the Company may provide
Employee with additional compensation as a bonus if the Board of Directors, or
the Compensation Committee, in its discretion, determines that Employee's
contribution to the Company warrants such additional payment and the Company's
anticipated financial performance for the present period permits such payment.

     4.  BENEFITS.

         (a) MEDICAL/DENTAL INSURANCE. Employee shall be entitled to participate
in any and all employee benefit plans, including all medical and dental
insurance plans as in effect from time to time for senior executives of the
Company. Such participation shall be subject to (i) the terms of the applicable
plan documents, (ii) generally applicable policies of the Company, and (iii) the
discretion of the Board of Directors, the Compensation Committee or any
administrative or other committee provided for in, or contemplated by, such
plan. Nothing contained in this Agreement shall be construed to create any
obligation on the part of the Company to establish any such plan or to maintain
the effectiveness of any such plan which may be in effect from time to time.

         (b) LIFE INSURANCE/DISABILITY INSURANCE. The Company shall provide
Employee with such life and/or disability insurance as the Company may from time
to time make available to senior executives of the Company.

                                        2


         (c) EXPENSES. The Company shall promptly reimburse Employee for all
reasonable business expenses incurred by Employee in accordance with the
practices of the Company for senior executives of the Company, as in effect from
time to time.

         (d) VACATION. Employee shall receive paid vacation annually in
accordance with terms determined for such Employee by the Company, but in no
event shall Employee receive less than four weeks of paid vacation per year.

         (e) STOCK OPTIONS; RESTRICTED STOCK. Employee shall be entitled to
grants of stock options and restricted stock awards in an amount to be
determined by the Compensation Committee in its discretion under the Boston
Properties, Inc. 1997 Stock Option and Incentive Plan or any other stock option
plan adopted by the Company from time to time (the "STOCK OPTION PLAN").

         (f) DEFERRED COMPENSATION. Employee shall be entitled to participate in
any deferred compensation plan or arrangement that the Company may have in place
for its senior executives and/or officers.

         (g) AUTOMOBILE. The Company shall provide Employee with an automobile
allowance of Seven Hundred Fifty Dollars ($750) per month, such amount to be
increased from time to time in the Company's sole discretion and to be paid to
Employee no less frequently than monthly.

         (h) OTHER BENEFITS. The Company shall provide to Employee such other
benefits, including the right to participate in such retirement or pension
plans, as are made generally available to senior executives of the Company from
time to time. Such participation shall be subject to (i) the terms of the
applicable plan documents, (ii) generally applicable policies of the Company,
and (iii) the discretion of the Board of Directors, the Compensation Committee,
or any administrative or other committee provided for in, or contemplated by,
such plan.

         (i) TAXATION OF PAYMENTS AND BENEFITS. The Company shall undertake to
make deductions, withholdings and tax reports with respect to payments and
benefits under this Agreement to the extent that it reasonably and in good faith
believes that it is required to make such deductions, withholdings and tax
reports. Payments under this Agreement shall be in amounts net of any such
deductions or withholdings. Nothing in this Agreement shall be construed to
require the Company to make any payments to compensate the Employee for any
adverse tax effect associated with any payments or benefits or for any deduction
or withholding from any payment or benefit.

     5.  INDEMNIFICATION. To the full extent permitted by law and subject to the
Company's Certificate of Incorporation and Bylaws, the Company shall indemnify
Employee with respect to any actions commenced against Employee in his capacity
as a director or officer or former director or officer of the Company, or any
affiliate thereof for which he may serve in such capacity, and the Company shall
advance on a timely basis any expenses incurred in defending such actions. The
obligation to indemnify hereunder shall survive the termination of

                                        3


this Agreement. The Company agrees to use its best efforts to secure and
maintain directors' and officers' liability insurance with respect to Employee.

     6.  COMPANY AUTHORITY/POLICIES. Employee agrees to observe and comply with
the rules and regulations of the Company as adopted by its Board of Directors
respecting the performance of his duties and to carry out and perform orders,
directions and policies communicated to him from time to time by the Board of
Directors.

     7.  RECORDS/NONDISCLOSURE/COMPANY POLICIES.

         (a) GENERAL. All records, financial statements and similar documents
obtained, reviewed or compiled by Employee in the course of the performance by
him of services for the Company, whether or not confidential information or
trade secrets, shall be the exclusive property of the Company. Employee shall
have no rights in such documents upon any termination of this Agreement.

         (b) CONFIDENTIAL INFORMATION. Employee will not disclose to any person
or entity (except as required by applicable law, the rules of the New York Stock
Exchange, or otherwise in connection with the performance of his duties and
responsibilities hereunder), or use for his own benefit or gain, any
confidential information of the Company obtained by him incident to his
employment with the Company. Employee shall take all reasonable steps to
safeguard any confidential information and to protect such confidential
information against disclosure, misuse, loss, or theft. The term "CONFIDENTIAL
INFORMATION" includes, without limitation, financial information, business
plans, prospects, and opportunities which have been discussed or considered by
the management of the Company, but does not include any information which has
become part of the public domain by means other than Employee's non-observance
of his obligations hereunder.

     This Paragraph 7 shall survive the termination of this Agreement.

     8.  TERMINATION/SEVERANCE.

         (a) GENERAL.

             (i)    AT WILL EMPLOYMENT. Employee's employment hereunder is "at
will" and, therefore, may be terminated at any time, with or without cause, at
the option of the Company, subject only to the severance obligations under this
Paragraph 8.

             (ii)   NOTICE OF TERMINATION. Except for termination as a result of
Employee's death as specified in Subparagraph 8(b), any termination of
Employee's employment by the Company or any such termination by Employee shall
be communicated by written Notice of Termination to the other party hereto. For
purposes of this Agreement, a "NOTICE OF TERMINATION" shall mean a notice which
shall indicate the specific termination provision hereunder relied upon by the
terminating party.

             (iii)  DATE OF TERMINATION. "DATE OF TERMINATION" shall mean: (A)
if Employee's employment is terminated by his death, the date of his death; (B)
if Employee's employment is terminated on account of disability under
Subparagraph 8(c), the date on which

                                        4


Notice of Termination is given; (C) if Employee's employment is terminated by
the Company for Cause under Subparagraph 8(d), the date on which a Notice of
Termination is given; (D) if Employee's employment is terminated by the Company
without Cause under Subparagraph 8(e)(i), thirty (30) days after the date on
which a Notice of Termination is given; and (E) if Employee's employment is
terminated by Employee under Subparagraph 8(e)(ii) or 8(f), thirty (30) days
after the date on which a Notice of Termination is given.

         (b) DEATH. Employee's employment hereunder shall terminate upon his
death. If Employee's employment terminates by reason of his death, the Company
shall, within ninety (90) days of death, pay in a lump sum amount to such person
as Employee shall designate in a notice filed with the Company or, if no such
person is designated, to Employee's estate, Employee's accrued and unpaid Base
Salary to his date of death, plus his accrued and unpaid target bonus, prorated
for the number of days actually employed in the then current calendar year. All
unvested stock options and stock-based grants shall immediately vest in
Employee's estate or other legal representatives and become exercisable or
nonforfeitable, and Employee's estate or other legal representatives shall have
such period of time to exercise the stock options as is provided in the Stock
Option Plan and agreements with Employee pursuant thereto. For a period of
eighteen (18) months following the Date of Termination, and subject to the
continued copayment of premium amounts by the Employee's spouse and dependents,
the Employee's spouse and dependents shall continue to participate in the
Company's health insurance plan upon the same terms and conditions in effect on
the Date of Termination, PROVIDED, HOWEVER, that the continuation of health
benefits under this Subparagraph shall reduce and count against the rights of
the Employee's spouse and dependents under the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended ("COBRA"). In addition to the foregoing,
any payments to which Employee's spouse, beneficiaries, or estate may be
entitled under any employee benefit plan shall also be paid in accordance with
the terms of such plan or arrangement. Such payments, in the aggregate, shall
fully discharge the Company's obligations hereunder.

         (c) DISABILITY. If, as a result of Employee's incapacity due to
physical or mental illness, Employee shall have been absent from his duties
hereunder on a full-time basis for one hundred eighty (180) calendar days in the
aggregate in any twelve (12) month period, the Company may terminate Employee's
employment hereunder. During any period that Employee fails to perform his
duties hereunder as a result of incapacity due to physical or mental illness,
Employee shall continue to receive his accrued and unpaid Base Salary and
accrued and unpaid target bonus, prorated for the number of days actually
employed in the then current calendar year, until Employee's employment is
terminated due to disability in accordance with this Subparagraph (c) or until
Employee terminates his employment in accordance with Subparagraph (e)(ii) or
(f), if earlier. All unvested stock options and stock-based grants shall
immediately vest and become exercisable or nonforfeitable, and Employee shall
have such period of time to exercise the stock options as is provided in the
Stock Option Plan and agreements with Employee pursuant thereto. For a period of
eighteen (18) months following the Date of Termination and subject to the
Employee's continued copayment of premium amounts, the Employee, Employee's
spouse and dependents shall continue to participate in the Company's health
insurance plan upon the same terms and conditions in effect on the Date of
Termination, PROVIDED, HOWEVER, that the continuation of health benefits under
this Subparagraph shall reduce and count against Employee's rights under COBRA.
In addition to the foregoing, any payments

                                        5


to which Employee may be entitled under any employee benefit plan shall also be
paid in accordance with the terms of such plan or arrangement. Such payments, in
the aggregate, shall fully discharge the Company's obligations hereunder.

         (d) TERMINATION BY THE COMPANY FOR CAUSE.

             (i)    The Company may terminate Employee's employment hereunder
for Cause. "CAUSE" shall mean: (A) gross negligence or willful misconduct by
Employee in connection with the performance of his material duties hereunder;
(B) a breach by Employee of any of his material duties hereunder (for reasons
other than physical or mental illness) and the failure of Employee to cure such
breach within thirty (30) days after written notice thereof by the Company; (C)
conduct by Employee against the material best interests of the Company or a
material act of common law fraud against the Company or its affiliates or
employees; or (D) indictment of Employee of a felony and such indictment has a
material adverse affect on the interests or reputation of the Company.

             (ii)   If Employee's employment is terminated by the Company for
Cause, then the Company shall, through the Date of Termination, pay Employee his
accrued and unpaid Base Salary. Thereafter, the Company shall have no further
obligations to Employee except as otherwise provided hereunder; PROVIDED that
any such termination shall not adversely affect or alter Employee's rights under
any employee benefit plan of the Company in which Employee, at the Date of
Termination, has a vested interest, unless otherwise provided in such employee
benefit plan or any agreement or other instrument attendant thereto.
Notwithstanding the foregoing and in addition to whatever other rights or
remedies the Company may have at law or in equity, all stock options and other
stock-based grants held by Employee, whether vested or unvested as of the Date
of Termination, shall immediately expire on the Date of Termination if
Employee's employment is terminated by the Company for Cause.

         (e) TERMINATION BY THE COMPANY WITHOUT CAUSE OR BY EMPLOYEE FOR GOOD
REASON.

             (i)    The Company may terminate Employee's employment hereunder
without Cause if such termination is approved by the Chief Executive Officer or
Chairman of the Company. Any termination by the Company of Employee's employment
hereunder which does not (A) constitute a termination for Cause under
Subparagraph (d)(i), (B) result from the death or disability of the Employee
under Subparagraph (b) or (c), or (C) result from the expiration of the Term,
shall be deemed a termination without Cause.

             (ii)   Employee may terminate his employment hereunder for Good
Reason. "GOOD REASON" shall mean: (A) a substantial adverse change, not
consented to by Employee, in the nature or scope of Employee's responsibilities,
authorities, powers, functions, or duties under this Agreement; (B) a breach by
the Company of any of its material obligations hereunder and the failure of the
Company to cure such breach within thirty (30) days after written notice thereof
by Employee; or (C) the involuntary relocation of the Company's offices at which
Employee is principally employed to a location more than fifty (50) miles from
such offices, or the requirement by the Company that Employee be based anywhere
other than the Company's offices at such location on an extended basis, except
for required travel on the

                                        6


Company's business to an extent substantially consistent with Employee's
business travel obligations.

             (iii)  If Employee's employment is terminated by the Company
without Cause or if Employee terminates his employment for Good Reason in
accordance with this Subparagraph (e), then the Company shall, through the Date
of Termination, pay Employee his accrued and unpaid Base Salary and his accrued
and unpaid target bonus prorated for the number of days actually employed in the
then current calendar year. In addition, subject to signing by Employee of a
general release of claims in a form and manner satisfactory to the Company, the
Employee shall be entitled to the following:

                    (A) Salary continuation in an amount (the "SEVERANCE
AMOUNT") equal to the sum of (x) his annual Base Salary under Subparagraph 3(a)
and (y) the amount of his cash bonus, if any, received in respect of the
immediately preceding year under Subparagraph 3(b). The Severance Amount shall
be paid in equal monthly installments over a twelve (12) month period;

                    (B) All stock options and other stock-based awards, granted
to Employee after the Effective Date, in which Employee would have vested if he
had remained employed for a period of twelve (12) months commencing on the Date
of Termination, shall vest and become exercisable or nonforfeitable as of the
Date of Termination;

                    (C) Subject to the Employee's continued copayment of premium
amounts, continued participation for twelve (12) months in the Company's health
insurance plan upon the same terms and conditions in effect on the Date of
Termination, PROVIDED, HOWEVER, that the continuation of health benefits under
this Subparagraph shall reduce and count against Employee's rights under COBRA;
and

                    (D) Subject to (B) above, all rights and benefits granted or
in effect with respect to Employee under the Stock Option Plan and agreements
with Employee pursuant thereto.

         (f) VOLUNTARY TERMINATION BY EMPLOYEE. Employee may terminate his
employment hereunder for any reason, including, but not limited to, Good Reason
in accordance with Subparagraph (e)(ii). If Employee's employment is terminated
by Employee other than for Good Reason, then the Company shall, through the Date
of Termination, pay Employee his accrued and unpaid Base Salary. Thereafter, the
Company shall have no further obligations to Employee except as otherwise
expressly provided hereunder; PROVIDED any such termination shall not adversely
affect or alter Employee's rights under any employee benefit plan of the Company
in which Employee, at the Date of Termination, has a vested interest, unless
otherwise provided in such employee benefit plan or any agreement or other
instrument attendant thereto. The vesting and exercise of any stock options and
the forfeitability of any stock-based grants held by Employee shall be governed
by the terms of the Stock Option Plan and the related agreements between
Employee and the Company

         (g) NO MITIGATION. Without regard to the reason for the termination of
Employee's employment hereunder, Employee shall be under no obligation to
mitigate damages

                                        7


with respect to such termination under any circumstances and in the event
Employee is employed or receives income from any other source, there shall be no
offset against the amounts due from the Company hereunder.

     9.  NONCOMPETITION. Because Employee's services to the Company are special
and because Employee has access to the Company's confidential information,
Employee covenants and agrees that during the Employment Period and until the
end of a one-year period following the termination of Employee's employment with
the Company for any reason, Employee shall not, without the prior written
consent of the Company (which shall be authorized by approval of the Board of
Directors of the Company, including the approval of a majority of the
independent Directors of the Company), directly or indirectly:

         (a) engage, participate or assist in, either individually or as an
owner, partner, employee, consultant, director, officer, trustee, or agent of
any business that engages or attempts to engage in, directly or indirectly, the
acquisition, development, construction, operation, management, or leasing of any
commercial real estate property in any of the Company's Markets (as hereinafter
defined) at the time of Employee's termination of employment;

         (b) intentionally interfere with, disrupt or attempt to disrupt the
relationship, contractual or otherwise, between the Company or its affiliates
and any tenant, supplier, contractor, lender, employee, or governmental agency
or authority; or

         (c) call upon, compete for, solicit, divert, or take away, or attempt
to divert or take away any of the tenants or employees of the Company or its
affiliates, either for himself or for any other business, operation,
corporation, partnership, association, agency, or other person or entity.

     "MARKET" as used herein means an area covering a 25 mile radius around (x)
any property or land owned by the Company, under development by the Company or
with respect to which the Company has an agreement or option to acquire a
property, development or land or (y) any property or development for which the
Company provides third party development or management services; PROVIDED that
for any such property, development or land located in New York City, no such
radial area shall extend beyond New York City.

     This Paragraph 9 shall not be interpreted to prevent Employee from engaging
in Minority Interest Passive Investments or any other activity permitted under
Subparagraph 2(b). This Paragraph 9 shall survive the termination of this
Agreement.

     Notwithstanding anything to the contrary herein, the noncompetition
provision of this Paragraph 9 shall not apply if Employee's employment
terminates after a Change in Control (as defined in the Severance Plan).

     10. CHANGE IN CONTROL PAYMENTS. Notwithstanding anything to the contrary in
the foregoing, in the event that the Employee's employment terminates after a
Change in Control (as defined in the Severance Plan) under circumstances that
would entitle him to payments and benefits under the Severance Plan, he shall
not be entitled to receive any payments or benefits under this Agreement.

                                        8


     11. CONFLICTING AGREEMENTS. Employee hereby represents and warrants that
the execution of this Agreement and the performance of his obligations hereunder
will not breach or be in conflict with any other agreement to which he is a
party or is bound, and that he is not now subject to any covenants against
competition or similar covenants which would affect the performance of his
obligations hereunder.

     12. NOTICES. All notices, requests, demands, and other communications under
this Agreement shall be in writing and shall be deemed duly given (i) if
delivered by hand and receipted for by the party addressee, on the date of such
receipt or (ii) if mailed by domestic certified or registered mail with postage
prepaid, on the third business day after the date postmarked. Address for notice
for the Company is as shown above, or as subsequently modified by written
notice. Address for notice for the Employee is the address shown on the records
of the Company.

     13. INTEGRATION. This Agreement constitutes the entire agreement between
the parties with respect to the subject matter hereof and supersedes all prior
agreements between the parties with respect to any related subject matter,
provided, however, that the Severance Plan, as amended from time to time, shall
remain in full force and effect hereafter.

     14. ASSIGNMENT; SUCCESSORS AND ASSIGNS, ETC. Neither the Company nor the
Employee may make any assignment of this Agreement or any interest herein, by
operation of law or otherwise, without the prior written consent of the other
party; provided that the Company may assign its rights under this Agreement
without the consent of the Employee in the event that the Company shall effect a
reorganization, consolidate with or merge into any other corporation,
partnership, organization or other entity, or transfer all or substantially all
of its properties or assets to any other corporation, partnership, organization
or other entity. This Agreement shall inure to the benefit of and be binding
upon the Company and the Employee, their respective successors, executors,
administrators, heirs and permitted assigns.

     15. MISCELLANEOUS. Headings herein are for convenience of reference only
and shall not define, limit or interpret the contents hereof.

     16. AMENDMENT. This Agreement may be amended, modified or supplemented by
the mutual consent of the parties in writing, but no oral amendment,
modification or supplement shall be effective.

     17. ARBITRATION; OTHER DISPUTES. Any dispute or controversy arising under
or in connection with this Agreement shall be settled exclusively by arbitration
in Boston, Massachusetts, in accordance with the rules of the American
Arbitration Association then in effect. Judgment may be entered in any court
having jurisdiction. Notwithstanding the above, the Company shall be entitled to
seek a restraining order or injunction in any court of competent jurisdiction to
prevent any continuation of any violation of Paragraph 7 or 9 hereof. In the
event that the Company terminates Employee's employment for Cause under
Subparagraph 8(d)(i) and Employee contends that Cause did not exist, then the
Company's only obligation shall be to submit such claim to arbitration and the
only issue before the arbitrator will be whether Employee was in fact terminated
for Cause. If the arbitrator determines that Employee was not terminated for
Cause by the Company, then the only remedies that the arbitrator may award are

                                        9


(i) the Severance Amount specified in Subparagraph 8(e)(iii)(A), (ii) the costs
of arbitration, (iii) Employee's reasonable attorneys' fees, (iv) the additional
vesting of Employee's stock options and other stock-based awards in accordance
with Subparagraph 8(e)(iii)(B), and (v) the continued participation in the
Company's health insurance plan in accordance with Subparagraph 8(e)(iii)(C). If
the arbitrator finds that Employee was terminated for Cause, the arbitrator will
be without authority to award Employee anything, and the parties will each be
responsible for their own attorneys' fees, and they will divide the costs of
arbitration equally. Furthermore, should a dispute occur concerning Employee's
mental or physical capacity as described in Subparagraph 8(c), a doctor selected
by Employee and a doctor selected by the Company shall be entitled to examine
Employee. If the opinion of the Company's doctor and Employee's doctor conflict,
the Company's doctor and Employee's doctor shall together agree upon a third
doctor, whose opinion shall be binding. This Paragraph 17 shall survive the
termination of this Agreement.

     18. LITIGATION AND REGULATORY COOPERATION. During and after Employee's
employment, Employee shall reasonably cooperate with the Company in the defense
or prosecution of any claims or actions now in existence or which may be brought
in the future against or on behalf of the Company which relate to events or
occurrences that transpired while Employee was employed by the Company; provided
that such cooperation shall not materially and adversely affect Employee or
expose Employee to an increased probability of civil or criminal litigation.
Employee's cooperation in connection with such claims or actions shall include,
without limitation, being available to meet with counsel to prepare for
discovery or trial and to act as a witness on behalf of the Company at mutually
convenient times. During and after Employee's employment, Employee also shall
cooperate fully with the Company in connection with any investigation or review
of any federal, state or local regulatory authority as any such investigation or
review relates to events or occurrences that transpired while Employee was
employed by the Company. The Company shall also provide Employee with
compensation on an hourly basis calculated at his final base compensation rate
for requested litigation and regulatory cooperation that occurs after his
termination of employment, and reimburse Employee for all costs and expenses
incurred in connection with his performance under this Paragraph 18, including,
without limitation, reasonable attorneys' fees and costs.

     19. SEVERABILITY. If any provision of this Agreement shall to any extent be
held void or unenforceable (as to duration, scope, activity, subject or
otherwise) by a court of competent jurisdiction, such provision shall be deemed
to be modified so as to constitute a provision conforming as nearly as possible
to the original provision while still remaining valid and enforceable. In such
event, the remainder of this Agreement (or the application of such provision to
persons or circumstances other than those in respect of which it is deemed to be
void or unenforceable) shall not be affected thereby. Each other provision of
this Agreement, unless specifically conditioned on the voided aspect of such
provision, shall remain valid and enforceable to the fullest extent permitted by
law; any other provisions of this Agreement that are specifically conditioned on
the voided aspect of such invalid provision shall also be deemed to be modified
so as to constitute a provision conforming as nearly as possible to the original
provision while still remaining valid and enforceable to the fullest extent
permitted by law.

     20. GOVERNING LAW. This Agreement shall be construed and regulated in all
respects under the laws of the State of Delaware.

                                       10


     21. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be taken to be
an original; but such counterparts shall together constitute one and the same
document.

                                       11


     IN WITNESS WHEREOF, this Agreement is entered into as of the date and year
first above written.

                                             BOSTON PROPERTIES, INC.

                                             By: /s/ Edward H. Linde
                                                 -------------------------------
                                                 Name:  Edward H. Linde
                                                 Title: President and
                                                        Chief Executive Officer


                                             /s/ Bryan J. Koop
                                             -----------------------------------
                                             Bryan J. Koop

                                       12



                                                                   EXHIBIT 10.11

                              EMPLOYMENT AGREEMENT

     THIS AGREEMENT (the "AGREEMENT") is made as of the 26th day of November,
2002 (the "EFFECTIVE DATE"), by and between Mitchell S. Landis (the "EMPLOYEE")
and Boston Properties, Inc., a Delaware corporation, with its principal
executive office located at 111 Huntington Avenue, Suite 300, Boston,
Massachusetts 02199-7610 (together with its subsidiaries, the "COMPANY").

                                WITNESSETH THAT:

     WHEREAS, the Company has determined that it is in its best interest to
continue the employment of the Employee on the terms hereinafter set forth;

     WHEREAS, the Employee wishes to be so employed pursuant to the terms
hereinafter set forth;

     WHEREAS, the Company has adopted that certain Senior Executive Severance
Plan, effective as of July 30, 1998 (the "SEVERANCE PLAN"), as may be amended
from time to time, and which the parties desire to remain in full force and
effect after the date hereof;

     NOW, THEREFORE, in consideration of the mutual covenants and premises set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Employee
hereby agree as follows:

     1.  TERM. Subject to the provisions of Paragraph 8, the term of employment
pursuant to this Agreement (the "TERM") shall be two (2) years from the
Effective Date and shall be renewed automatically for periods of one (1) year
commencing at each anniversary of the Effective Date, unless written notice is
given by either party to the other not less than ninety (90) days prior to any
such anniversary of such party's election not to extend the Term.

     2.  EMPLOYMENT; DUTIES; LOCATION.

         (a) Employee shall initially serve as an officer of the Company with
the title Senior Vice President, Regional Manager. Employee's duties and
authority shall be commensurate with his title and position with the Company.
The Employee shall report directly to the Executive Vice President for
Operations and shall serve the Company in such other capacity or capacities as
the Employee may be requested to serve by the Board of Directors of the Company
(the "BOARD OF DIRECTORS"). In such capacity or capacities, the Employee shall
perform such services and duties in connection with the business, affairs and
operations of the Company as may be assigned or delegated to the Employee from
time to time by or under the authority of the Board of Directors. The Employee
shall be principally located at the Company's Princeton office.

         (b) Employee agrees to his employment as described in this Paragraph 2
and agrees to devote substantially ALL of his working time and efforts to the
performance of his duties hereunder, except as otherwise approved by the Board
of Directors. Notwithstanding the foregoing, nothing herein shall be interpreted
to preclude Employee from (i) engaging in



Minority Interest Passive Investments (as defined below), including Minority
Interest Passive Investments in, or relating to the ownership, development,
operation, management, or leasing of, commercial real estate properties or (ii)
participating as an officer or director of, or advisor to, any charitable or
other tax exempt organization; PROVIDED that such activities and related duties
and pursuits do not restrict Employee's ability to fulfill his obligations as an
officer and employee of the Company as set forth herein.

     Engaging in a "MINORITY INTEREST PASSIVE INVESTMENT" means acquiring,
holding, and exercising the voting rights associated with an investment made
through (i) the purchase of securities (including partnership interests) that
represent a non-controlling, minority interest in an entity or (ii) the lending
of money, in either case with the purpose or intent of obtaining a return on
such investment but without management by Employee of the property or business
to which such investment directly or indirectly relates and without any business
or strategic consultation by Employee with such entity.

     3.  COMPENSATION.

         (a) BASE SALARY. The Company shall pay Employee an annual salary of Two
Hundred Five Thousand Dollars ($205,000) (the "BASE SALARY"), payable in
accordance with the Company's normal business practices for senior executives
(including tax withholding), but in no event less frequently than monthly.
Employee's Base Salary shall be reviewed at least annually by the Board of
Directors or the Compensation Committee of the Board of Directors (the
"COMPENSATION COMMITTEE") and may be increased but not decreased in its
discretion.

         (b) BONUS. On each annual compensation determination date established
by the Company during the Term, the Company shall review the performance of the
Company and of Employee during the prior year, and the Company may provide
Employee with additional compensation as a bonus if the Board of Directors, or
the Compensation Committee, in its discretion, determines that Employee's
contribution to the Company warrants such additional payment and the Company's
anticipated financial performance for the present period permits such payment.

     4.  BENEFITS.

         (a) MEDICAL/DENTAL INSURANCE. Employee shall be entitled to participate
in any and all employee benefit plans, including all medical and dental
insurance plans as in effect from time to time for senior executives of the
Company. Such participation shall be subject to (i) the terms of the applicable
plan documents, (ii) generally applicable policies of the Company, and (iii) the
discretion of the Board of Directors, the Compensation Committee or any
administrative or other committee provided for in, or contemplated by, such
plan. Nothing contained in this Agreement shall be construed to create any
obligation on the part of the Company to establish any such plan or to maintain
the effectiveness of any such plan which may be in effect from time to time.

         (b) LIFE INSURANCE/DISABILITY INSURANCE. The Company shall provide
Employee with such life and/or disability insurance as the Company may from time
to time make available to senior executives of the Company.

                                        2


         (c) EXPENSES. The Company shall promptly reimburse Employee for all
reasonable business expenses incurred by Employee in accordance with the
practices of the Company for senior executives of the Company, as in effect from
time to time.

         (d) VACATION. Employee shall receive paid vacation annually in
accordance with terms determined for such Employee by the Company, but in no
event shall Employee receive less than four weeks of paid vacation per year.

         (e) STOCK OPTIONS; RESTRICTED STOCK. Employee shall be entitled to
grants of stock options and restricted stock awards in an amount to be
determined by the Compensation Committee in its discretion under the Boston
Properties, Inc. 1997 Stock Option and Incentive Plan or any other stock option
plan adopted by the Company from time to time (the "STOCK OPTION PLAN").

         (f) DEFERRED COMPENSATION. Employee shall be entitled to participate in
any deferred compensation plan or arrangement that the Company may have in place
for its senior executives and/or officers.

         (g) AUTOMOBILE. The Company shall provide Employee with an automobile
allowance of Seven Hundred Fifty Dollars ($750) per month, such amount to be
increased from time to time in the Company's sole discretion and to be paid to
Employee no less frequently than monthly.

         (h) OTHER BENEFITS. The Company shall provide to Employee such other
benefits, including the right to participate in such retirement or pension
plans, as are made generally available to senior executives of the Company from
time to time. Such participation shall be subject to (i) the terms of the
applicable plan documents, (ii) generally applicable policies of the Company,
and (iii) the discretion of the Board of Directors, the Compensation Committee,
or any administrative or other committee provided for in, or contemplated by,
such plan.

         (i) TAXATION OF PAYMENTS AND BENEFITS. The Company shall undertake to
make deductions, withholdings and tax reports with respect to payments and
benefits under this Agreement to the extent that it reasonably and in good faith
believes that it is required to make such deductions, withholdings and tax
reports. Payments under this Agreement shall be in amounts net of any such
deductions or withholdings. Nothing in this Agreement shall be construed to
require the Company to make any payments to compensate the Employee for any
adverse tax effect associated with any payments or benefits or for any deduction
or withholding from any payment or benefit.

     5.  INDEMNIFICATION. To the full extent permitted by law and subject to the
Company's Certificate of Incorporation and Bylaws, the Company shall indemnify
Employee with respect to any actions commenced against Employee in his capacity
as a director or officer or former director or officer of the Company, or any
affiliate thereof for which he may serve in such capacity, and the Company shall
advance on a timely basis any expenses incurred in defending such actions. The
obligation to indemnify hereunder shall survive the termination of

                                        3


this Agreement. The Company agrees to use its best efforts to secure and
maintain directors' and officers' liability insurance with respect to Employee.

     6.  COMPANY AUTHORITY/POLICIES. Employee agrees to observe and comply with
the rules and regulations of the Company as adopted by its Board of Directors
respecting the performance of his duties and to carry out and perform orders,
directions and policies communicated to him from time to time by the Board of
Directors.

     7.  RECORDS/NONDISCLOSURE/COMPANY POLICIES.

         (a) GENERAL. All records, financial statements and similar documents
obtained, reviewed or compiled by Employee in the course of the performance by
him of services for the Company, whether or not confidential information or
trade secrets, shall be the exclusive property of the Company. Employee shall
have no rights in such documents upon any termination of this Agreement.

         (b) CONFIDENTIAL INFORMATION. Employee will not disclose to any person
or entity (except as required by applicable law, the rules of the New York Stock
Exchange, or otherwise in connection with the performance of his duties and
responsibilities hereunder), or use for his own benefit or gain, any
confidential information of the Company obtained by him incident to his
employment with the Company. Employee shall take all reasonable steps to
safeguard any confidential information and to protect such confidential
information against disclosure, misuse, loss, or theft. The term "CONFIDENTIAL
INFORMATION" includes, without limitation, financial information, business
plans, prospects, and opportunities which have been discussed or considered by
the management of the Company, but does not include any information which has
become part of the public domain by means other than Employee's non-observance
of his obligations hereunder.

     This Paragraph 7 shall survive the termination of this Agreement.

     8.  TERMINATION/SEVERANCE.

         (a) GENERAL.

             (i)    AT WILL EMPLOYMENT. Employee's employment hereunder is "at
will" and, therefore, may be terminated at any time, with or without cause, at
the option of the Company, subject only to the severance obligations under this
Paragraph 8.

             (ii)   NOTICE OF TERMINATION. Except for termination as a result of
Employee's death as specified in Subparagraph 8(b), any termination of
Employee's employment by the Company or any such termination by Employee shall
be communicated by written Notice of Termination to the other party hereto. For
purposes of this Agreement, a "NOTICE OF TERMINATION" shall mean a notice which
shall indicate the specific termination provision hereunder relied upon by the
terminating party.

             (iii)  DATE OF TERMINATION. "DATE OF TERMINATION" shall mean: (A)
if Employee's employment is terminated by his death, the date of his death; (B)
if Employee's employment is terminated on account of disability under
Subparagraph 8(c), the date on which

                                        4


Notice of Termination is given; (C) if Employee's employment is terminated by
the Company for Cause under Subparagraph 8(d), the date on which a Notice of
Termination is given; (D) if Employee's employment is terminated by the Company
without Cause under Subparagraph 8(e)(i), thirty (30) days after the date on
which a Notice of Termination is given; and (E) if Employee's employment is
terminated by Employee under Subparagraph 8(e)(ii) or 8(f), thirty (30) days
after the date on which a Notice of Termination is given.

         (b) DEATH. Employee's employment hereunder shall terminate upon his
death. If Employee's employment terminates by reason of his death, the Company
shall, within ninety (90) days of death, pay in a lump sum amount to such person
as Employee shall designate in a notice filed with the Company or, if no such
person is designated, to Employee's estate, Employee's accrued and unpaid Base
Salary to his date of death, plus his accrued and unpaid target bonus, prorated
for the number of days actually employed in the then current calendar year. All
unvested stock options and stock-based grants shall immediately vest in
Employee's estate or other legal representatives and become exercisable or
nonforfeitable, and Employee's estate or other legal representatives shall have
such period of time to exercise the stock options as is provided in the Stock
Option Plan and agreements with Employee pursuant thereto. For a period of
eighteen (18) months following the Date of Termination, and subject to the
continued copayment of premium amounts by the Employee's spouse and dependents,
the Employee's spouse and dependents shall continue to participate in the
Company's health insurance plan upon the same terms and conditions in effect on
the Date of Termination, PROVIDED, HOWEVER, that the continuation of health
benefits under this Subparagraph shall reduce and count against the rights of
the Employee's spouse and dependents under the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended ("COBRA"). In addition to the foregoing,
any payments to which Employee's spouse, beneficiaries, or estate may be
entitled under any employee benefit plan shall also be paid in accordance with
the terms of such plan or arrangement. Such payments, in the aggregate, shall
fully discharge the Company's obligations hereunder.

         (c) DISABILITY. If, as a result of Employee's incapacity due to
physical or mental illness, Employee shall have been absent from his duties
hereunder on a full-time basis for one hundred eighty (180) calendar days in the
aggregate in any twelve (12) month period, the Company may terminate Employee's
employment hereunder. During any period that Employee fails to perform his
duties hereunder as a result of incapacity due to physical or mental illness,
Employee shall continue to receive his accrued and unpaid Base Salary and
accrued and unpaid target bonus, prorated for the number of days actually
employed in the then current calendar year, until Employee's employment is
terminated due to disability in accordance with this Subparagraph (c) or until
Employee terminates his employment in accordance with Subparagraph (e)(ii) or
(f), if earlier. All unvested stock options and stock-based grants shall
immediately vest and become exercisable or nonforfeitable, and Employee shall
have such period of time to exercise the stock options as is provided in the
Stock Option Plan and agreements with Employee pursuant thereto. For a period of
eighteen (18) months following the Date of Termination and subject to the
Employee's continued copayment of premium amounts, the Employee, Employee's
spouse and dependents shall continue to participate in the Company's health
insurance plan upon the same terms and conditions in effect on the Date of
Termination, PROVIDED, HOWEVER, that the continuation of health benefits under
this Subparagraph shall reduce and count against Employee's rights under COBRA.
In addition to the foregoing, any payments

                                        5


to which Employee may be entitled under any employee benefit plan shall also be
paid in accordance with the terms of such plan or arrangement. Such payments, in
the aggregate, shall fully discharge the Company's obligations hereunder.

         (d) TERMINATION BY THE COMPANY FOR CAUSE.

             (i)    The Company may terminate Employee's employment hereunder
for Cause. "CAUSE" shall mean: (A) gross negligence or willful misconduct by
Employee in connection with the performance of his material duties hereunder;
(B) a breach by Employee of any of his material duties hereunder (for reasons
other than physical or mental illness) and the failure of Employee to cure such
breach within thirty (30) days after written notice thereof by the Company; (C)
conduct by Employee against the material best interests of the Company or a
material act of common law fraud against the Company or its affiliates or
employees; or (D) indictment of Employee of a felony and such indictment has a
material adverse affect on the interests or reputation of the Company.

             (ii)   If Employee's employment is terminated by the Company for
Cause, then the Company shall, through the Date of Termination, pay Employee his
accrued and unpaid Base Salary. Thereafter, the Company shall have no further
obligations to Employee except as otherwise provided hereunder; PROVIDED that
any such termination shall not adversely affect or alter Employee's rights under
any employee benefit plan of the Company in which Employee, at the Date of
Termination, has a vested interest, unless otherwise provided in such employee
benefit plan or any agreement or other instrument attendant thereto.
Notwithstanding the foregoing and in addition to whatever other rights or
remedies the Company may have at law or in equity, all stock options and other
stock-based grants held by Employee, whether vested or unvested as of the Date
of Termination, shall immediately expire on the Date of Termination if
Employee's employment is terminated by the Company for Cause.

         (e) TERMINATION BY THE COMPANY WITHOUT CAUSE OR BY EMPLOYEE FOR GOOD
REASON.

             (i)    The Company may terminate Employee's employment hereunder
without Cause if such termination is approved by the Chief Executive Officer or
Chairman of the Company. Any termination by the Company of Employee's employment
hereunder which does not (A) constitute a termination for Cause under
Subparagraph (d)(i), (B) result from the death or disability of the Employee
under Subparagraph (b) or (c), or (C) result from the expiration of the Term,
shall be deemed a termination without Cause.

             (ii)   Employee may terminate his employment hereunder for Good
Reason. "GOOD REASON" shall mean: (A) a substantial adverse change, not
consented to by Employee, in the nature or scope of Employee's responsibilities,
authorities, powers, functions, or duties under this Agreement; (B) a breach by
the Company of any of its material obligations hereunder and the failure of the
Company to cure such breach within thirty (30) days after written notice thereof
by Employee; or (C) the involuntary relocation of the Company's offices at which
Employee is principally employed to a location more than fifty (50) miles from
such offices, or the requirement by the Company that Employee be based anywhere
other than the Company's offices at such location on an extended basis, except
for required travel on the

                                        6


Company's business to an extent substantially consistent with Employee's
business travel obligations.

             (iii)  If Employee's employment is terminated by the Company
without Cause or if Employee terminates his employment for Good Reason in
accordance with this Subparagraph (e), then the Company shall, through the Date
of Termination, pay Employee his accrued and unpaid Base Salary and his accrued
and unpaid target bonus prorated for the number of days actually employed in the
then current calendar year. In addition, subject to signing by Employee of a
general release of claims in a form and manner satisfactory to the Company, the
Employee shall be entitled to the following:

                    (A) Salary continuation in an amount (the "SEVERANCE
AMOUNT") equal to the sum of (x) his annual Base Salary under Subparagraph 3(a)
and (y) the amount of his cash bonus, if any, received in respect of the
immediately preceding year under Subparagraph 3(b). The Severance Amount shall
be paid in equal monthly installments over a twelve (12) month period;

                    (B) All stock options and other stock-based awards, granted
to Employee after the Effective Date, in which Employee would have vested if he
had remained employed for a period of twelve (12) months commencing on the Date
of Termination, shall vest and become exercisable or nonforfeitable as of the
Date of Termination;

                    (C) Subject to the Employee's continued copayment of premium
amounts, continued participation for twelve (12) months in the Company's health
insurance plan upon the same terms and conditions in effect on the Date of
Termination, PROVIDED, HOWEVER, that the continuation of health benefits under
this Subparagraph shall reduce and count against Employee's rights under COBRA;
and

                    (D) Subject to (B) above, all rights and benefits granted or
in effect with respect to Employee under the Stock Option Plan and agreements
with Employee pursuant thereto.

         (f) VOLUNTARY TERMINATION BY EMPLOYEE. Employee may terminate his
employment hereunder for any reason, including, but not limited to, Good Reason
in accordance with Subparagraph (e)(ii). If Employee's employment is terminated
by Employee other than for Good Reason, then the Company shall, through the Date
of Termination, pay Employee his accrued and unpaid Base Salary. Thereafter, the
Company shall have no further obligations to Employee except as otherwise
expressly provided hereunder; PROVIDED any such termination shall not adversely
affect or alter Employee's rights under any employee benefit plan of the Company
in which Employee, at the Date of Termination, has a vested interest, unless
otherwise provided in such employee benefit plan or any agreement or other
instrument attendant thereto. The vesting and exercise of any stock options and
the forfeitability of any stock-based grants held by Employee shall be governed
by the terms of the Stock Option Plan and the related agreements between
Employee and the Company

         (g) NO MITIGATION. Without regard to the reason for the termination of
Employee's employment hereunder, Employee shall be under no obligation to
mitigate damages

                                        7


with respect to such termination under any circumstances and in the event
Employee is employed or receives income from any other source, there shall be no
offset against the amounts due from the Company hereunder.

     9.  NONCOMPETITION. Because Employee's services to the Company are special
and because Employee has access to the Company's confidential information,
Employee covenants and agrees that during the Employment Period and until the
end of a one-year period following the termination of Employee's employment with
the Company for any reason, Employee shall not, without the prior written
consent of the Company (which shall be authorized by approval of the Board of
Directors of the Company, including the approval of a majority of the
independent Directors of the Company), directly or indirectly:

         (a) engage, participate or assist in, either individually or as an
owner, partner, employee, consultant, director, officer, trustee, or agent of
any business that engages or attempts to engage in, directly or indirectly, the
acquisition, development, construction, operation, management, or leasing of any
commercial real estate property in any of the Company's Markets (as hereinafter
defined) at the time of Employee's termination of employment;

         (b) intentionally interfere with, disrupt or attempt to disrupt the
relationship, contractual or otherwise, between the Company or its affiliates
and any tenant, supplier, contractor, lender, employee, or governmental agency
or authority; or

         (c) call upon, compete for, solicit, divert, or take away, or attempt
to divert or take away any of the tenants or employees of the Company or its
affiliates, either for himself or for any other business, operation,
corporation, partnership, association, agency, or other person or entity.

     "MARKET" as used herein means an area covering a 25 mile radius around (x)
any property or land owned by the Company, under development by the Company or
with respect to which the Company has an agreement or option to acquire a
property, development or land or (y) any property or development for which the
Company provides third party development or management services; PROVIDED that
for any such property, development or land located in New York City, no such
radial area shall extend beyond New York City.

     This Paragraph 9 shall not be interpreted to prevent Employee from engaging
in Minority Interest Passive Investments or any other activity permitted under
Subparagraph 2(b). This Paragraph 9 shall survive the termination of this
Agreement.

     Notwithstanding anything to the contrary herein, the noncompetition
provision of this Paragraph 9 shall not apply if Employee's employment
terminates after a Change in Control (as defined in the Severance Plan).

     10. CHANGE IN CONTROL PAYMENTS. Notwithstanding anything to the contrary in
the foregoing, in the event that the Employee's employment terminates after a
Change in Control (as defined in the Severance Plan) under circumstances that
would entitle him to payments and benefits under the Severance Plan, he shall
not be entitled to receive any payments or benefits under this Agreement.

                                        8


     11. CONFLICTING AGREEMENTS. Employee hereby represents and warrants that
the execution of this Agreement and the performance of his obligations hereunder
will not breach or be in conflict with any other agreement to which he is a
party or is bound, and that he is not now subject to any covenants against
competition or similar covenants which would affect the performance of his
obligations hereunder.

     12. NOTICES. All notices, requests, demands, and other communications under
this Agreement shall be in writing and shall be deemed duly given (i) if
delivered by hand and receipted for by the party addressee, on the date of such
receipt or (ii) if mailed by domestic certified or registered mail with postage
prepaid, on the third business day after the date postmarked. Address for notice
for the Company is as shown above, or as subsequently modified by written
notice. Address for notice for the Employee is the address shown on the records
of the Company.

     13. INTEGRATION. This Agreement constitutes the entire agreement between
the parties with respect to the subject matter hereof and supersedes all prior
agreements between the parties with respect to any related subject matter,
provided, however, that the Severance Plan, as amended from time to time, shall
remain in full force and effect hereafter.

     14. ASSIGNMENT; SUCCESSORS AND ASSIGNS, ETC. Neither the Company nor the
Employee may make any assignment of this Agreement or any interest herein, by
operation of law or otherwise, without the prior written consent of the other
party; provided that the Company may assign its rights under this Agreement
without the consent of the Employee in the event that the Company shall effect a
reorganization, consolidate with or merge into any other corporation,
partnership, organization or other entity, or transfer all or substantially all
of its properties or assets to any other corporation, partnership, organization
or other entity. This Agreement shall inure to the benefit of and be binding
upon the Company and the Employee, their respective successors, executors,
administrators, heirs and permitted assigns.

     15. MISCELLANEOUS. Headings herein are for convenience of reference only
and shall not define, limit or interpret the contents hereof.

     16. AMENDMENT. This Agreement may be amended, modified or supplemented by
the mutual consent of the parties in writing, but no oral amendment,
modification or supplement shall be effective.

     17. ARBITRATION; OTHER DISPUTES. Any dispute or controversy arising under
or in connection with this Agreement shall be settled exclusively by arbitration
in Boston, Massachusetts, in accordance with the rules of the American
Arbitration Association then in effect. Judgment may be entered in any court
having jurisdiction. Notwithstanding the above, the Company shall be entitled to
seek a restraining order or injunction in any court of competent jurisdiction to
prevent any continuation of any violation of Paragraph 7 or 9 hereof. In the
event that the Company terminates Employee's employment for Cause under
Subparagraph 8(d)(i) and Employee contends that Cause did not exist, then the
Company's only obligation shall be to submit such claim to arbitration and the
only issue before the arbitrator will be whether Employee was in fact terminated
for Cause. If the arbitrator determines that Employee was not terminated for
Cause by the Company, then the only remedies that the arbitrator may award are

                                        9


(i) the Severance Amount specified in Subparagraph 8(e)(iii)(A), (ii) the costs
of arbitration, (iii) Employee's reasonable attorneys' fees, (iv) the additional
vesting of Employee's stock options and other stock-based awards in accordance
with Subparagraph 8(e)(iii)(B), and (v) the continued participation in the
Company's health insurance plan in accordance with Subparagraph 8(e)(iii)(C). If
the arbitrator finds that Employee was terminated for Cause, the arbitrator will
be without authority to award Employee anything, and the parties will each be
responsible for their own attorneys' fees, and they will divide the costs of
arbitration equally. Furthermore, should a dispute occur concerning Employee's
mental or physical capacity as described in Subparagraph 8(c), a doctor selected
by Employee and a doctor selected by the Company shall be entitled to examine
Employee. If the opinion of the Company's doctor and Employee's doctor conflict,
the Company's doctor and Employee's doctor shall together agree upon a third
doctor, whose opinion shall be binding. This Paragraph 17 shall survive the
termination of this Agreement.

     18. LITIGATION AND REGULATORY COOPERATION. During and after Employee's
employment, Employee shall reasonably cooperate with the Company in the defense
or prosecution of any claims or actions now in existence or which may be brought
in the future against or on behalf of the Company which relate to events or
occurrences that transpired while Employee was employed by the Company; provided
that such cooperation shall not materially and adversely affect Employee or
expose Employee to an increased probability of civil or criminal litigation.
Employee's cooperation in connection with such claims or actions shall include,
without limitation, being available to meet with counsel to prepare for
discovery or trial and to act as a witness on behalf of the Company at mutually
convenient times. During and after Employee's employment, Employee also shall
cooperate fully with the Company in connection with any investigation or review
of any federal, state or local regulatory authority as any such investigation or
review relates to events or occurrences that transpired while Employee was
employed by the Company. The Company shall also provide Employee with
compensation on an hourly basis calculated at his final base compensation rate
for requested litigation and regulatory cooperation that occurs after his
termination of employment, and reimburse Employee for all costs and expenses
incurred in connection with his performance under this Paragraph 18, including,
without limitation, reasonable attorneys' fees and costs.

     19. SEVERABILITY. If any provision of this Agreement shall to any extent be
held void or unenforceable (as to duration, scope, activity, subject or
otherwise) by a court of competent jurisdiction, such provision shall be deemed
to be modified so as to constitute a provision conforming as nearly as possible
to the original provision while still remaining valid and enforceable. In such
event, the remainder of this Agreement (or the application of such provision to
persons or circumstances other than those in respect of which it is deemed to be
void or unenforceable) shall not be affected thereby. Each other provision of
this Agreement, unless specifically conditioned on the voided aspect of such
provision, shall remain valid and enforceable to the fullest extent permitted by
law; any other provisions of this Agreement that are specifically conditioned on
the voided aspect of such invalid provision shall also be deemed to be modified
so as to constitute a provision conforming as nearly as possible to the original
provision while still remaining valid and enforceable to the fullest extent
permitted by law.

     20. GOVERNING LAW. This Agreement shall be construed and regulated in all
respects under the laws of the State of Delaware.

                                       10


     21. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be taken to be
an original; but such counterparts shall together constitute one and the same
document.

                                       11


     IN WITNESS WHEREOF, this Agreement is entered into as of the date and year
first above written.

                                             BOSTON PROPERTIES, INC.


                                             By: /s/ Edward H. Linde
                                                 -------------------------------
                                                 Name:  Edward H. Linde
                                                 Title: President and
                                                        Chief Executive Officer


                                             /s/ Mitchell S. Landis
                                             -----------------------------------
                                             Mitchell S. Landis

                                       12



                                                                   EXHIBIT 10.12

                              EMPLOYMENT AGREEMENT

     THIS AGREEMENT (the "AGREEMENT") is made as of the 29th day of November,
2002 (the "EFFECTIVE DATE"), by and between Douglas T. Linde (the "EMPLOYEE")
and Boston Properties, Inc., a Delaware corporation, with its principal
executive office located at 111 Huntington Avenue, Suite 300, Boston,
Massachusetts 02199-7610 (together with its subsidiaries, the "COMPANY").

                                WITNESSETH THAT:

     WHEREAS, the Company has determined that it is in its best interest to
continue the employment of the Employee on the terms hereinafter set forth;

     WHEREAS, the Employee wishes to be so employed pursuant to the terms
hereinafter set forth;

     WHEREAS, the Company has adopted that certain Senior Executive Severance
Plan, effective as of July 30, 1998 (the "SEVERANCE PLAN"), as may be amended
from time to time, and which the parties desire to remain in full force and
effect after the date hereof;

     NOW, THEREFORE, in consideration of the mutual covenants and premises set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Employee
hereby agree as follows:

     1.   TERM. Subject to the provisions of Paragraph 8, the term of employment
pursuant to this Agreement (the "TERM") shall be two (2) years from the
Effective Date and shall be renewed automatically for periods of one (1) year
commencing at each anniversary of the Effective Date, unless written notice is
given by either party to the other not less than ninety (90) days prior to any
such anniversary of such party's election not to extend the Term.

     2.   EMPLOYMENT; DUTIES; LOCATION.

          (a)   Employee shall initially serve as an officer of the Company with
the title Senior Vice President, Chief Financial Officer and Treasurer.
Employee's duties and authority shall be commensurate with his title and
position with the Company. The Employee shall report directly to the Chief
Executive Officer and/or President and shall serve the Company in such other
capacity or capacities as the Employee may be requested to serve by the Board of
Directors of the Company (the "BOARD OF DIRECTORS"). In such capacity or
capacities, the Employee shall perform such services and duties in connection
with the business, affairs and operations of the Company as may be assigned or
delegated to the Employee from time to time by or under the authority of the
Board of Directors. The Employee shall be principally located at the Company's
Boston office.

          (b)   Employee agrees to his employment as described in this Paragraph
2 and agrees to devote substantially all of his working time and efforts to the
performance of his duties hereunder, except as otherwise approved by the Board
of Directors. Notwithstanding the foregoing, nothing herein shall be interpreted
to preclude Employee from (i) engaging in



Minority Interest Passive Investments (as defined below), including Minority
Interest Passive Investments in, or relating to the ownership, development,
operation, management, or leasing of, commercial real estate properties or (ii)
participating as an officer or director of, or advisor to, any charitable or
other tax exempt organization; PROVIDED that such activities and related duties
and pursuits do not restrict Employee's ability to fulfill his obligations as an
officer and employee of the Company as set forth herein.

     Engaging in a "MINORITY INTEREST PASSIVE INVESTMENT" means acquiring,
holding, and exercising the voting rights associated with an investment made
through (i) the purchase of securities (including partnership interests) that
represent a non-controlling, minority interest in an entity or (ii) the lending
of money, in either case with the purpose or intent of obtaining a return on
such investment but without management by Employee of the property or business
to which such investment directly or indirectly relates and without any business
or strategic consultation by Employee with such entity.

     3.   COMPENSATION.

          (a)   BASE SALARY. The Company shall pay Employee an annual salary of
Three Hundred Thousand Dollars ($300,000) (the "BASE SALARY"), payable in
accordance with the Company's normal business practices for senior executives
(including tax withholding), but in no event less frequently than monthly.
Employee's Base Salary shall be reviewed at least annually by the Board of
Directors or the Compensation Committee of the Board of Directors (the
"COMPENSATION COMMITTEE") and may be increased but not decreased in its
discretion.

          (b)   BONUS. On each annual compensation determination date
established by the Company during the Term, the Company shall review the
performance of the Company and of Employee during the prior year, and the
Company may provide Employee with additional compensation as a bonus if the
Board of Directors, or the Compensation Committee, in its discretion, determines
that Employee's contribution to the Company warrants such additional payment and
the Company's anticipated financial performance for the present period permits
such payment.

     4.   BENEFITS.

          (a)   MEDICAL/DENTAL INSURANCE. Employee shall be entitled to
participate in any and all employee benefit plans, including all medical and
dental insurance plans as in effect from time to time for senior executives of
the Company. Such participation shall be subject to (i) the terms of the
applicable plan documents, (ii) generally applicable policies of the Company,
and (iii) the discretion of the Board of Directors, the Compensation Committee
or any administrative or other committee provided for in, or contemplated by,
such plan. Nothing contained in this Agreement shall be construed to create any
obligation on the part of the Company to establish any such plan or to maintain
the effectiveness of any such plan which may be in effect from time to time.

          (b)   LIFE INSURANCE/DISABILITY INSURANCE. The Company shall provide
Employee with such life and/or disability insurance as the Company may from time
to time make available to senior executives of the Company.

                                        2


          (c)   EXPENSES. The Company shall promptly reimburse Employee for all
reasonable business expenses incurred by Employee in accordance with the
practices of the Company for senior executives of the Company, as in effect from
time to time.

          (d)   VACATION. Employee shall receive paid vacation annually in
accordance with terms determined for such Employee by the Company, but in no
event shall Employee receive less than four weeks of paid vacation per year.

          (e)   STOCK OPTIONS; RESTRICTED STOCK. Employee shall be entitled to
grants of stock options and restricted stock awards in an amount to be
determined by the Compensation Committee in its discretion under the Boston
Properties, Inc. 1997 Stock Option and Incentive Plan or any other stock option
plan adopted by the Company from time to time (the "STOCK OPTION PLAN").

          (f)   DEFERRED COMPENSATION. Employee shall be entitled to participate
in any deferred compensation plan or arrangement that the Company may have in
place for its senior executives and/or officers.

          (g)   AUTOMOBILE. The Company shall provide Employee with an
automobile allowance of Seven Hundred Fifty Dollars ($750) per month, such
amount to be increased from time to time in the Company's sole discretion and to
be paid to Employee no less frequently than monthly.

          (h)   OTHER BENEFITS. The Company shall provide to Employee such other
benefits, including the right to participate in such retirement or pension
plans, as are made generally available to senior executives of the Company from
time to time. Such participation shall be subject to (i) the terms of the
applicable plan documents, (ii) generally applicable policies of the Company,
and (iii) the discretion of the Board of Directors, the Compensation Committee,
or any administrative or other committee provided for in, or contemplated by,
such plan.

          (i)   TAXATION OF PAYMENTS AND BENEFITS. The Company shall undertake
to make deductions, withholdings and tax reports with respect to payments and
benefits under this Agreement to the extent that it reasonably and in good faith
believes that it is required to make such deductions, withholdings and tax
reports. Payments under this Agreement shall be in amounts net of any such
deductions or withholdings. Nothing in this Agreement shall be construed to
require the Company to make any payments to compensate the Employee for any
adverse tax effect associated with any payments or benefits or for any deduction
or withholding from any payment or benefit.

     5.   INDEMNIFICATION. To the full extent permitted by law and subject to
the Company's Certificate of Incorporation and Bylaws, the Company shall
indemnify Employee with respect to any actions commenced against Employee in his
capacity as a director or officer or former director or officer of the Company,
or any affiliate thereof for which he may serve in such capacity, and the
Company shall advance on a timely basis any expenses incurred in defending such
actions. The obligation to indemnify hereunder shall survive the termination of

                                        3


this Agreement. The Company agrees to use its best efforts to secure and
maintain directors' and officers' liability insurance with respect to Employee.

     6.   COMPANY AUTHORITY/POLICIES. Employee agrees to observe and comply with
the rules and regulations of the Company as adopted by its Board of Directors
respecting the performance of his duties and to carry out and perform orders,
directions and policies communicated to him from time to time by the Board of
Directors.

     7.   RECORDS/NONDISCLOSURE/COMPANY POLICIES.

          (a)   GENERAL. All records, financial statements and similar documents
obtained, reviewed or compiled by Employee in the course of the performance by
him of services for the Company, whether or not confidential information or
trade secrets, shall be the exclusive property of the Company. Employee shall
have no rights in such documents upon any termination of this Agreement.

          (b)   CONFIDENTIAL INFORMATION. Employee will not disclose to any
person or entity (except as required by applicable law, the rules of the New
York Stock Exchange, or otherwise in connection with the performance of his
duties and responsibilities hereunder), or use for his own benefit or gain, any
confidential information of the Company obtained by him incident to his
employment with the Company. Employee shall take all reasonable steps to
safeguard any confidential information and to protect such confidential
information against disclosure, misuse, loss, or theft. The term "CONFIDENTIAL
INFORMATION" includes, without limitation, financial information, business
plans, prospects, and opportunities which have been discussed or considered by
the management of the Company, but does not include any information which has
become part of the public domain by means other than Employee's non-observance
of his obligations hereunder.

     This Paragraph 7 shall survive the termination of this Agreement.

     8.   TERMINATION/SEVERANCE.

          (a)   GENERAL.

                (i)      AT WILL EMPLOYMENT.  Employee's employment hereunder is
"at will" and, therefore, may be terminated at any time, with or without cause,
at the option of the Company, subject only to the severance obligations under
this Paragraph 8.

                (ii)     NOTICE OF TERMINATION. Except for termination as a
result of Employee's death as specified in Subparagraph 8(b), any termination of
Employee's employment by the Company or any such termination by Employee shall
be communicated by written Notice of Termination to the other party hereto. For
purposes of this Agreement, a "NOTICE OF TERMINATION" shall mean a notice which
shall indicate the specific termination provision hereunder relied upon by the
terminating party.

                (iii)    DATE OF TERMINATION. "DATE OF TERMINATION" shall mean:
(A) if Employee's employment is terminated by his death, the date of his death;
(B) if Employee's employment is terminated on account of disability under
Subparagraph 8(c), the date on which

                                        4


Notice of Termination is given; (C) if Employee's employment is terminated by
the Company for Cause under Subparagraph 8(d), the date on which a Notice of
Termination is given; (D) if Employee's employment is terminated by the Company
without Cause under Subparagraph 8(e)(i), thirty (30) days after the date on
which a Notice of Termination is given; and (E) if Employee's employment is
terminated by Employee under Subparagraph 8(e)(ii) or 8(f), thirty (30) days
after the date on which a Notice of Termination is given.

          (b)   DEATH. Employee's employment hereunder shall terminate upon his
death. If Employee's employment terminates by reason of his death, the Company
shall, within ninety (90) days of death, pay in a lump sum amount to such person
as Employee shall designate in a notice filed with the Company or, if no such
person is designated, to Employee's estate, Employee's accrued and unpaid Base
Salary to his date of death, plus his accrued and unpaid target bonus, prorated
for the number of days actually employed in the then current calendar year. All
unvested stock options and stock-based grants shall immediately vest in
Employee's estate or other legal representatives and become exercisable or
nonforfeitable, and Employee's estate or other legal representatives shall have
such period of time to exercise the stock options as is provided in the Stock
Option Plan and agreements with Employee pursuant thereto. For a period of
eighteen (18) months following the Date of Termination, and subject to the
continued copayment of premium amounts by the Employee's spouse and dependents,
the Employee's spouse and dependents shall continue to participate in the
Company's health insurance plan upon the same terms and conditions in effect on
the Date of Termination, PROVIDED, HOWEVER, that the continuation of health
benefits under this Subparagraph shall reduce and count against the rights of
the Employee's spouse and dependents under the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended ("COBRA"). In addition to the foregoing,
any payments to which Employee's spouse, beneficiaries, or estate may be
entitled under any employee benefit plan shall also be paid in accordance with
the terms of such plan or arrangement. Such payments, in the aggregate, shall
fully discharge the Company's obligations hereunder.

          (c)   DISABILITY. If, as a result of Employee's incapacity due to
physical or mental illness, Employee shall have been absent from his duties
hereunder on a full-time basis for one hundred eighty (180) calendar days in the
aggregate in any twelve (12) month period, the Company may terminate Employee's
employment hereunder. During any period that Employee fails to perform his
duties hereunder as a result of incapacity due to physical or mental illness,
Employee shall continue to receive his accrued and unpaid Base Salary and
accrued and unpaid target bonus, prorated for the number of days actually
employed in the then current calendar year, until Employee's employment is
terminated due to disability in accordance with this Subparagraph (c) or until
Employee terminates his employment in accordance with Subparagraph (e)(ii) or
(f), if earlier. All unvested stock options and stock-based grants shall
immediately vest and become exercisable or nonforfeitable, and Employee shall
have such period of time to exercise the stock options as is provided in the
Stock Option Plan and agreements with Employee pursuant thereto. For a period of
eighteen (18) months following the Date of Termination and subject to the
Employee's continued copayment of premium amounts, the Employee, Employee's
spouse and dependents shall continue to participate in the Company's health
insurance plan upon the same terms and conditions in effect on the Date of
Termination, PROVIDED, HOWEVER, that the continuation of health benefits under
this Subparagraph shall reduce and count against Employee's rights under COBRA.
In addition to the foregoing, any payments

                                        5


to which Employee may be entitled under any employee benefit plan shall also be
paid in accordance with the terms of such plan or arrangement. Such payments, in
the aggregate, shall fully discharge the Company's obligations hereunder.

          (d)   TERMINATION BY THE COMPANY FOR CAUSE.

                (i)      The Company may terminate Employee's employment
hereunder for Cause. "CAUSE" shall mean: (A) gross negligence or willful
misconduct by Employee in connection with the performance of his material duties
hereunder; (B) a breach by Employee of any of his material duties hereunder (for
reasons other than physical or mental illness) and the failure of Employee to
cure such breach within thirty (30) days after written notice thereof by the
Company; (C) conduct by Employee against the material best interests of the
Company or a material act of common law fraud against the Company or its
affiliates or employees; or (D) indictment of Employee of a felony and such
indictment has a material adverse affect on the interests or reputation of the
Company.

                (ii)     If Employee's employment is terminated by the Company
for Cause, then the Company shall, through the Date of Termination, pay Employee
his accrued and unpaid Base Salary. Thereafter, the Company shall have no
further obligations to Employee except as otherwise provided hereunder; PROVIDED
that any such termination shall not adversely affect or alter Employee's rights
under any employee benefit plan of the Company in which Employee, at the Date of
Termination, has a vested interest, unless otherwise provided in such employee
benefit plan or any agreement or other instrument attendant thereto.
Notwithstanding the foregoing and in addition to whatever other rights or
remedies the Company may have at law or in equity, all stock options and other
stock-based grants held by Employee, whether vested or unvested as of the Date
of Termination, shall immediately expire on the Date of Termination if
Employee's employment is terminated by the Company for Cause.

          (e)   TERMINATION BY THE COMPANY WITHOUT CAUSE OR BY EMPLOYEE FOR GOOD
REASON.

                (i)      The Company may terminate Employee's employment
hereunder without Cause if such termination is approved by the Chief Executive
Officer or Chairman of the Company. Any termination by the Company of Employee's
employment hereunder which does not (A) constitute a termination for Cause under
Subparagraph (d)(i), (B) result from the death or disability of the Employee
under Subparagraph (b) or (c), or (C) result from the expiration of the Term,
shall be deemed a termination without Cause.

                (ii)     Employee may terminate his employment hereunder for
Good Reason. "GOOD REASON" shall mean: (A) a substantial adverse change, not
consented to by Employee, in the nature or scope of Employee's responsibilities,
authorities, powers, functions, or duties under this Agreement; (B) a breach by
the Company of any of its material obligations hereunder and the failure of the
Company to cure such breach within thirty (30) days after written notice thereof
by Employee; or (C) the involuntary relocation of the Company's offices at which
Employee is principally employed to a location more than fifty (50) miles from
such offices, or the requirement by the Company that Employee be based anywhere
other than the Company's offices at such location on an extended basis, except
for required travel on the

                                        6


Company's business to an extent substantially consistent with Employee's
business travel obligations.

                (iii)    If Employee's employment is terminated by the Company
without Cause or if Employee terminates his employment for Good Reason in
accordance with this Subparagraph (e), then the Company shall, through the Date
of Termination, pay Employee his accrued and unpaid Base Salary and his accrued
and unpaid target bonus prorated for the number of days actually employed in the
then current calendar year. In addition, subject to signing by Employee of a
general release of claims in a form and manner satisfactory to the Company, the
Employee shall be entitled to the following:

                         (A)  Salary continuation in an amount (the "SEVERANCE
AMOUNT") equal to the sum of (x) his annual Base Salary under Subparagraph 3(a)
and (y) the amount of his cash bonus, if any, received in respect of the
immediately preceding year under Subparagraph 3(b). The Severance Amount shall
be paid in equal monthly installments over a twelve (12) month period;

                         (B)  All stock options and other stock-based awards,
granted to Employee after the Effective Date, in which Employee would have
vested if he had remained employed for a period of twelve (12) months commencing
on the Date of Termination, shall vest and become exercisable or nonforfeitable
as of the Date of Termination;

                         (C)  Subject to the Employee's continued copayment of
premium amounts, continued participation for twelve (12) months in the Company's
health insurance plan upon the same terms and conditions in effect on the Date
of Termination, PROVIDED, HOWEVER, that the continuation of health benefits
under this Subparagraph shall reduce and count against Employee's rights under
COBRA; and

                         (D)  Subject to (B) above, all rights and benefits
granted or in effect with respect to Employee under the Stock Option Plan and
agreements with Employee pursuant thereto.

          (f)   VOLUNTARY TERMINATION BY EMPLOYEE. Employee may terminate his
employment hereunder for any reason, including, but not limited to, Good Reason
in accordance with Subparagraph (e)(ii). If Employee's employment is terminated
by Employee other than for Good Reason, then the Company shall, through the Date
of Termination, pay Employee his accrued and unpaid Base Salary. Thereafter, the
Company shall have no further obligations to Employee except as otherwise
expressly provided hereunder; PROVIDED any such termination shall not adversely
affect or alter Employee's rights under any employee benefit plan of the Company
in which Employee, at the Date of Termination, has a vested interest, unless
otherwise provided in such employee benefit plan or any agreement or other
instrument attendant thereto. The vesting and exercise of any stock options and
the forfeitability of any stock-based grants held by Employee shall be governed
by the terms of the Stock Option Plan and the related agreements between
Employee and the Company

          (g)   NO MITIGATION. Without regard to the reason for the termination
of Employee's employment hereunder, Employee shall be under no obligation to
mitigate damages

                                        7


with respect to such termination under any circumstances and in the event
Employee is employed or receives income from any other source, there shall be no
offset against the amounts due from the Company hereunder.

     9.   NONCOMPETITION. Because Employee's services to the Company are special
and because Employee has access to the Company's confidential information,
Employee covenants and agrees that during the Employment Period and until the
end of a one-year period following the termination of Employee's employment with
the Company for any reason, Employee shall not, without the prior written
consent of the Company (which shall be authorized by approval of the Board of
Directors of the Company, including the approval of a majority of the
independent Directors of the Company), directly or indirectly:

          (a)   engage, participate or assist in, either individually or as an
owner, partner, employee, consultant, director, officer, trustee, or agent of
any business that engages or attempts to engage in, directly or indirectly, the
acquisition, development, construction, operation, management, or leasing of any
commercial real estate property in any of the Company's Markets (as hereinafter
defined) at the time of Employee's termination of employment;

          (b)   intentionally interfere with, disrupt or attempt to disrupt the
relationship, contractual or otherwise, between the Company or its affiliates
and any tenant, supplier, contractor, lender, employee, or governmental agency
or authority; or

          (c)   call upon, compete for, solicit, divert, or take away, or
attempt to divert or take away any of the tenants or employees of the Company or
its affiliates, either for himself or for any other business, operation,
corporation, partnership, association, agency, or other person or entity.

     "MARKET" as used herein means an area covering a 25 mile radius around (x)
any property or land owned by the Company, under development by the Company or
with respect to which the Company has an agreement or option to acquire a
property, development or land or (y) any property or development for which the
Company provides third party development or management services; PROVIDED that
for any such property, development or land located in New York City, no such
radial area shall extend beyond New York City.

     This Paragraph 9 shall not be interpreted to prevent Employee from engaging
in Minority Interest Passive Investments or any other activity permitted under
Subparagraph 2(b). This Paragraph 9 shall survive the termination of this
Agreement.

     Notwithstanding anything to the contrary herein, the noncompetition
provision of this Paragraph 9 shall not apply if Employee's employment
terminates after a Change in Control (as defined in the Severance Plan).

     10.  CHANGE IN CONTROL PAYMENTS. Notwithstanding anything to the contrary
in the foregoing, in the event that the Employee's employment terminates after a
Change in Control (as defined in the Severance Plan) under circumstances that
would entitle him to payments and benefits under the Severance Plan, he shall
not be entitled to receive any payments or benefits under this Agreement.

                                        8


     11.  CONFLICTING AGREEMENTS. Employee hereby represents and warrants that
the execution of this Agreement and the performance of his obligations hereunder
will not breach or be in conflict with any other agreement to which he is a
party or is bound, and that he is not now subject to any covenants against
competition or similar covenants which would affect the performance of his
obligations hereunder.

     12.  NOTICES. All notices, requests, demands, and other communications
under this Agreement shall be in writing and shall be deemed duly given (i) if
delivered by hand and receipted for by the party addressee, on the date of such
receipt or (ii) if mailed by domestic certified or registered mail with postage
prepaid, on the third business day after the date postmarked. Address for notice
for the Company is as shown above, or as subsequently modified by written
notice. Address for notice for the Employee is the address shown on the records
of the Company.

     13.  INTEGRATION. This Agreement constitutes the entire agreement between
the parties with respect to the subject matter hereof and supersedes all prior
agreements between the parties with respect to any related subject matter,
provided, however, that the Severance Plan, as amended from time to time, shall
remain in full force and effect hereafter.

     14.  ASSIGNMENT; SUCCESSORS AND ASSIGNS, ETC. Neither the Company nor the
Employee may make any assignment of this Agreement or any interest herein, by
operation of law or otherwise, without the prior written consent of the other
party; provided that the Company may assign its rights under this Agreement
without the consent of the Employee in the event that the Company shall effect a
reorganization, consolidate with or merge into any other corporation,
partnership, organization or other entity, or transfer all or substantially all
of its properties or assets to any other corporation, partnership, organization
or other entity. This Agreement shall inure to the benefit of and be binding
upon the Company and the Employee, their respective successors, executors,
administrators, heirs and permitted assigns.

     15.  MISCELLANEOUS. Headings herein are for convenience of reference only
and shall not define, limit or interpret the contents hereof.

     16.  AMENDMENT. This Agreement may be amended, modified or supplemented by
the mutual consent of the parties in writing, but no oral amendment,
modification or supplement shall be effective.

     17.  ARBITRATION; OTHER DISPUTES. Any dispute or controversy arising under
or in connection with this Agreement shall be settled exclusively by arbitration
in Boston, Massachusetts, in accordance with the rules of the American
Arbitration Association then in effect. Judgment may be entered in any court
having jurisdiction. Notwithstanding the above, the Company shall be entitled to
seek a restraining order or injunction in any court of competent jurisdiction to
prevent any continuation of any violation of Paragraph 7 or 9 hereof. In the
event that the Company terminates Employee's employment for Cause under
Subparagraph 8(d)(i) and Employee contends that Cause did not exist, then the
Company's only obligation shall be to submit such claim to arbitration and the
only issue before the arbitrator will be whether Employee was in fact terminated
for Cause. If the arbitrator determines that Employee was not terminated for
Cause by the Company, then the only remedies that the arbitrator may award are

                                        9


(i) the Severance Amount specified in Subparagraph 8(e)(iii)(A), (ii) the costs
of arbitration, (iii) Employee's reasonable attorneys' fees, (iv) the additional
vesting of Employee's stock options and other stock-based awards in accordance
with Subparagraph 8(e)(iii)(B), and (v) the continued participation in the
Company's health insurance plan in accordance with Subparagraph 8(e)(iii)(C). If
the arbitrator finds that Employee was terminated for Cause, the arbitrator will
be without authority to award Employee anything, and the parties will each be
responsible for their own attorneys' fees, and they will divide the costs of
arbitration equally. Furthermore, should a dispute occur concerning Employee's
mental or physical capacity as described in Subparagraph 8(c), a doctor selected
by Employee and a doctor selected by the Company shall be entitled to examine
Employee. If the opinion of the Company's doctor and Employee's doctor conflict,
the Company's doctor and Employee's doctor shall together agree upon a third
doctor, whose opinion shall be binding. This Paragraph 17 shall survive the
termination of this Agreement.

     18.  LITIGATION AND REGULATORY COOPERATION. During and after Employee's
employment, Employee shall reasonably cooperate with the Company in the defense
or prosecution of any claims or actions now in existence or which may be brought
in the future against or on behalf of the Company which relate to events or
occurrences that transpired while Employee was employed by the Company; provided
that such cooperation shall not materially and adversely affect Employee or
expose Employee to an increased probability of civil or criminal litigation.
Employee's cooperation in connection with such claims or actions shall include,
without limitation, being available to meet with counsel to prepare for
discovery or trial and to act as a witness on behalf of the Company at mutually
convenient times. During and after Employee's employment, Employee also shall
cooperate fully with the Company in connection with any investigation or review
of any federal, state or local regulatory authority as any such investigation or
review relates to events or occurrences that transpired while Employee was
employed by the Company. The Company shall also provide Employee with
compensation on an hourly basis calculated at his final base compensation rate
for requested litigation and regulatory cooperation that occurs after his
termination of employment, and reimburse Employee for all costs and expenses
incurred in connection with his performance under this Paragraph 18, including,
without limitation, reasonable attorneys' fees and costs.

     19.  SEVERABILITY. If any provision of this Agreement shall to any extent
be held void or unenforceable (as to duration, scope, activity, subject or
otherwise) by a court of competent jurisdiction, such provision shall be deemed
to be modified so as to constitute a provision conforming as nearly as possible
to the original provision while still remaining valid and enforceable. In such
event, the remainder of this Agreement (or the application of such provision to
persons or circumstances other than those in respect of which it is deemed to be
void or unenforceable) shall not be affected thereby. Each other provision of
this Agreement, unless specifically conditioned on the voided aspect of such
provision, shall remain valid and enforceable to the fullest extent permitted by
law; any other provisions of this Agreement that are specifically conditioned on
the voided aspect of such invalid provision shall also be deemed to be modified
so as to constitute a provision conforming as nearly as possible to the original
provision while still remaining valid and enforceable to the fullest extent
permitted by law.

     20.  GOVERNING LAW. This Agreement shall be construed and regulated in all
respects under the laws of the State of Delaware.

                                       10


     21.  COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be taken to be
an original; but such counterparts shall together constitute one and the same
document.

                                       11


     IN WITNESS WHEREOF, this Agreement is entered into as of the date and year
first above written.

                                         BOSTON PROPERTIES, INC.

                                         By: /s/ Edward H. Linde
                                            ------------------------------------
                                             Name:  Edward H. Linde
                                             Title: President and
                                                    Chief Executive Officer


                                         /s/ Douglas T. Linde
                                         ---------------------------------------
                                         Douglas T. Linde

                                       12



                                                                   EXHIBIT 10.13

                              EMPLOYMENT AGREEMENT

     THIS AGREEMENT (the "AGREEMENT") is made as of the 29th day of November,
2002 (the "EFFECTIVE DATE"), by and between E. Mitchell Norville (the
"EMPLOYEE") and Boston Properties, Inc., a Delaware corporation, with its
principal executive office located at 111 Huntington Avenue, Suite 300, Boston,
Massachusetts 02199-7610 (together with its subsidiaries, the "COMPANY").

                                WITNESSETH THAT:

     WHEREAS, the Company has determined that it is in its best interest to
continue the employment of the Employee on the terms hereinafter set forth;

     WHEREAS, the Employee wishes to be so employed pursuant to the terms
hereinafter set forth;

     WHEREAS, the Company has adopted that certain Senior Executive Severance
Plan, effective as of July 30, 1998 (the "SEVERANCE PLAN"), as may be amended
from time to time, and which the parties desire to remain in full force and
effect after the date hereof;

     NOW, THEREFORE, in consideration of the mutual covenants and premises set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Employee
hereby agree as follows:

     1.   TERM. Subject to the provisions of Paragraph 8, the term of employment
pursuant to this Agreement (the "TERM") shall be two (2) years from the
Effective Date and shall be renewed automatically for periods of one (1) year
commencing at each anniversary of the Effective Date, unless written notice is
given by either party to the other not less than ninety (90) days prior to any
such anniversary of such party's election not to extend the Term.

     2.   EMPLOYMENT; DUTIES; LOCATION.

          (a)   Employee shall initially serve as an officer of the Company with
the title Senior Vice President, Regional Manager. Employee's duties and
authority shall be commensurate with his title and position with the Company.
The Employee shall report directly to the Executive Vice President for
Operations and shall serve the Company in such other capacity or capacities as
the Employee may be requested to serve by the Board of Directors of the Company
(the "BOARD OF DIRECTORS"). In such capacity or capacities, the Employee shall
perform such services and duties in connection with the business, affairs and
operations of the Company as may be assigned or delegated to the Employee from
time to time by or under the authority of the Board of Directors. The Employee
shall be principally located at the Company's Washington, D.C. office.

          (b)   Employee agrees to his employment as described in this Paragraph
2 and agrees to devote substantially ALL of his working time and efforts to the
performance of his duties hereunder, except as otherwise approved by the Board
of Directors. Notwithstanding the foregoing, nothing herein shall be interpreted
to preclude Employee from (i) engaging in



Minority Interest Passive Investments (as defined below), including Minority
Interest Passive Investments in, or relating to the ownership, development,
operation, management, or leasing of, commercial real estate properties or (ii)
participating as an officer or director of, or advisor to, any charitable or
other tax exempt organization; PROVIDED that such activities and related duties
and pursuits do not restrict Employee's ability to fulfill his obligations as an
officer and employee of the Company as set forth herein.

     Engaging in a "MINORITY INTEREST PASSIVE INVESTMENT" means acquiring,
holding, and exercising the voting rights associated with an investment made
through (i) the purchase of securities (including partnership interests) that
represent a non-controlling, minority interest in an entity or (ii) the lending
of money, in either case with the purpose or intent of obtaining a return on
such investment but without management by Employee of the property or business
to which such investment directly or indirectly relates and without any business
or strategic consultation by Employee with such entity.

     3.   COMPENSATION.

          (a)   BASE SALARY. The Company shall pay Employee an annual salary of
Two Hundred Seventy Thousand Dollars ($270,000) (the "BASE SALARY"), payable in
accordance with the Company's normal business practices for senior executives
(including tax withholding), but in no event less frequently than monthly.
Employee's Base Salary shall be reviewed at least annually by the Board of
Directors or the Compensation Committee of the Board of Directors (the
"COMPENSATION COMMITTEE") and may be increased but not decreased in its
discretion.

          (b)   BONUS. On each annual compensation determination date
established by the Company during the Term, the Company shall review the
performance of the Company and of Employee during the prior year, and the
Company may provide Employee with additional compensation as a bonus if the
Board of Directors, or the Compensation Committee, in its discretion, determines
that Employee's contribution to the Company warrants such additional payment and
the Company's anticipated financial performance for the present period permits
such payment.

     4.   BENEFITS.

          (a)   MEDICAL/DENTAL INSURANCE. Employee shall be entitled to
participate in any and all employee benefit plans, including all medical and
dental insurance plans as in effect from time to time for senior executives of
the Company. Such participation shall be subject to (i) the terms of the
applicable plan documents, (ii) generally applicable policies of the Company,
and (iii) the discretion of the Board of Directors, the Compensation Committee
or any administrative or other committee provided for in, or contemplated by,
such plan. Nothing contained in this Agreement shall be construed to create any
obligation on the part of the Company to establish any such plan or to maintain
the effectiveness of any such plan which may be in effect from time to time.

          (b)   LIFE INSURANCE/DISABILITY INSURANCE. The Company shall provide
Employee with such life and/or disability insurance as the Company may from time
to time make available to senior executives of the Company.

                                        2


          (c)   EXPENSES. The Company shall promptly reimburse Employee for all
reasonable business expenses incurred by Employee in accordance with the
practices of the Company for senior executives of the Company, as in effect from
time to time.

          (d)   VACATION. Employee shall receive paid vacation annually in
accordance with terms determined for such Employee by the Company, but in no
event shall Employee receive less than four weeks of paid vacation per year.

          (e)   STOCK OPTIONS; RESTRICTED STOCK. Employee shall be entitled to
grants of stock options and restricted stock awards in an amount to be
determined by the Compensation Committee in its discretion under the Boston
Properties, Inc. 1997 Stock Option and Incentive Plan or any other stock option
plan adopted by the Company from time to time (the "STOCK OPTION PLAN").

          (f)   DEFERRED COMPENSATION. Employee shall be entitled to participate
in any deferred compensation plan or arrangement that the Company may have in
place for its senior executives and/or officers.

          (g)   AUTOMOBILE. The Company shall provide Employee with an
automobile allowance of Seven Hundred Fifty Dollars ($750) per month, such
amount to be increased from time to time in the Company's sole discretion and to
be paid to Employee no less frequently than monthly.

          (h)   OTHER BENEFITS. The Company shall provide to Employee such other
benefits, including the right to participate in such retirement or pension
plans, as are made generally available to senior executives of the Company from
time to time. Such participation shall be subject to (i) the terms of the
applicable plan documents, (ii) generally applicable policies of the Company,
and (iii) the discretion of the Board of Directors, the Compensation Committee,
or any administrative or other committee provided for in, or contemplated by,
such plan.

          (i)   TAXATION OF PAYMENTS AND BENEFITS. The Company shall undertake
to make deductions, withholdings and tax reports with respect to payments and
benefits under this Agreement to the extent that it reasonably and in good faith
believes that it is required to make such deductions, withholdings and tax
reports. Payments under this Agreement shall be in amounts net of any such
deductions or withholdings. Nothing in this Agreement shall be construed to
require the Company to make any payments to compensate the Employee for any
adverse tax effect associated with any payments or benefits or for any deduction
or withholding from any payment or benefit.

     5.   INDEMNIFICATION. To the full extent permitted by law and subject to
the Company's Certificate of Incorporation and Bylaws, the Company shall
indemnify Employee with respect to any actions commenced against Employee in his
capacity as a director or officer or former director or officer of the Company,
or any affiliate thereof for which he may serve in such capacity, and the
Company shall advance on a timely basis any expenses incurred in defending such
actions. The obligation to indemnify hereunder shall survive the termination of

                                        3


this Agreement. The Company agrees to use its best efforts to secure and
maintain directors' and officers' liability insurance with respect to Employee.

     6.   COMPANY AUTHORITY/POLICIES. Employee agrees to observe and comply with
the rules and regulations of the Company as adopted by its Board of Directors
respecting the performance of his duties and to carry out and perform orders,
directions and policies communicated to him from time to time by the Board of
Directors.

     7.   RECORDS/NONDISCLOSURE/COMPANY POLICIES.

          (a)   GENERAL. All records, financial statements and similar documents
obtained, reviewed or compiled by Employee in the course of the performance by
him of services for the Company, whether or not confidential information or
trade secrets, shall be the exclusive property of the Company. Employee shall
have no rights in such documents upon any termination of this Agreement.

          (b)   CONFIDENTIAL INFORMATION. Employee will not disclose to any
person or entity (except as required by applicable law, the rules of the New
York Stock Exchange, or otherwise in connection with the performance of his
duties and responsibilities hereunder), or use for his own benefit or gain, any
confidential information of the Company obtained by him incident to his
employment with the Company. Employee shall take all reasonable steps to
safeguard any confidential information and to protect such confidential
information against disclosure, misuse, loss, or theft. The term "CONFIDENTIAL
INFORMATION" includes, without limitation, financial information, business
plans, prospects, and opportunities which have been discussed or considered by
the management of the Company, but does not include any information which has
become part of the public domain by means other than Employee's non-observance
of his obligations hereunder.

     This Paragraph 7 shall survive the termination of this Agreement.

     8.   TERMINATION/SEVERANCE.

          (a)   GENERAL.

                (i)      AT WILL EMPLOYMENT. Employee's employment hereunder is
"at will" and, therefore, may be terminated at any time, with or without cause,
at the option of the Company, subject only to the severance obligations under
this Paragraph 8.

                (ii)     NOTICE OF TERMINATION. Except for termination as a
result of Employee's death as specified in Subparagraph 8(b), any termination of
Employee's employment by the Company or any such termination by Employee shall
be communicated by written Notice of Termination to the other party hereto. For
purposes of this Agreement, a "NOTICE OF TERMINATION" shall mean a notice which
shall indicate the specific termination provision hereunder relied upon by the
terminating party.

                (iii)    DATE OF TERMINATION. "DATE OF TERMINATION" shall mean:
(A) if Employee's employment is terminated by his death, the date of his death;
(B) if Employee's employment is terminated on account of disability under
Subparagraph 8(c), the date on which

                                        4


Notice of Termination is given; (C) if Employee's employment is terminated by
the Company for Cause under Subparagraph 8(d), the date on which a Notice of
Termination is given; (D) if Employee's employment is terminated by the Company
without Cause under Subparagraph 8(e)(i), thirty (30) days after the date on
which a Notice of Termination is given; and (E) if Employee's employment is
terminated by Employee under Subparagraph 8(e)(ii) or 8(f), thirty (30) days
after the date on which a Notice of Termination is given.

          (b)   DEATH. Employee's employment hereunder shall terminate upon his
death. If Employee's employment terminates by reason of his death, the Company
shall, within ninety (90) days of death, pay in a lump sum amount to such person
as Employee shall designate in a notice filed with the Company or, if no such
person is designated, to Employee's estate, Employee's accrued and unpaid Base
Salary to his date of death, plus his accrued and unpaid target bonus, prorated
for the number of days actually employed in the then current calendar year. All
unvested stock options and stock-based grants shall immediately vest in
Employee's estate or other legal representatives and become exercisable or
nonforfeitable, and Employee's estate or other legal representatives shall have
such period of time to exercise the stock options as is provided in the Stock
Option Plan and agreements with Employee pursuant thereto. For a period of
eighteen (18) months following the Date of Termination, and subject to the
continued copayment of premium amounts by the Employee's spouse and dependents,
the Employee's spouse and dependents shall continue to participate in the
Company's health insurance plan upon the same terms and conditions in effect on
the Date of Termination, PROVIDED, HOWEVER, that the continuation of health
benefits under this Subparagraph shall reduce and count against the rights of
the Employee's spouse and dependents under the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended ("COBRA"). In addition to the foregoing,
any payments to which Employee's spouse, beneficiaries, or estate may be
entitled under any employee benefit plan shall also be paid in accordance with
the terms of such plan or arrangement. Such payments, in the aggregate, shall
fully discharge the Company's obligations hereunder.

          (c)   DISABILITY. If, as a result of Employee's incapacity due to
physical or mental illness, Employee shall have been absent from his duties
hereunder on a full-time basis for one hundred eighty (180) calendar days in the
aggregate in any twelve (12) month period, the Company may terminate Employee's
employment hereunder. During any period that Employee fails to perform his
duties hereunder as a result of incapacity due to physical or mental illness,
Employee shall continue to receive his accrued and unpaid Base Salary and
accrued and unpaid target bonus, prorated for the number of days actually
employed in the then current calendar year, until Employee's employment is
terminated due to disability in accordance with this Subparagraph (c) or until
Employee terminates his employment in accordance with Subparagraph (e)(ii) or
(f), if earlier. All unvested stock options and stock-based grants shall
immediately vest and become exercisable or nonforfeitable, and Employee shall
have such period of time to exercise the stock options as is provided in the
Stock Option Plan and agreements with Employee pursuant thereto. For a period of
eighteen (18) months following the Date of Termination and subject to the
Employee's continued copayment of premium amounts, the Employee, Employee's
spouse and dependents shall continue to participate in the Company's health
insurance plan upon the same terms and conditions in effect on the Date of
Termination, PROVIDED, HOWEVER, that the continuation of health benefits under
this Subparagraph shall reduce and count against Employee's rights under COBRA.
In addition to the foregoing, any payments

                                        5


to which Employee may be entitled under any employee benefit plan shall also be
paid in accordance with the terms of such plan or arrangement. Such payments, in
the aggregate, shall fully discharge the Company's obligations hereunder.

          (d)   TERMINATION BY THE COMPANY FOR CAUSE.

                (i)      The Company may terminate Employee's employment
hereunder for Cause. "CAUSE" shall mean: (A) gross negligence or willful
misconduct by Employee in connection with the performance of his material duties
hereunder; (B) a breach by Employee of any of his material duties hereunder (for
reasons other than physical or mental illness) and the failure of Employee to
cure such breach within thirty (30) days after written notice thereof by the
Company; (C) conduct by Employee against the material best interests of the
Company or a material act of common law fraud against the Company or its
affiliates or employees; or (D) indictment of Employee of a felony and such
indictment has a material adverse affect on the interests or reputation of the
Company.

                (ii)     If Employee's employment is terminated by the Company
for Cause, then the Company shall, through the Date of Termination, pay Employee
his accrued and unpaid Base Salary. Thereafter, the Company shall have no
further obligations to Employee except as otherwise provided hereunder; PROVIDED
that any such termination shall not adversely affect or alter Employee's rights
under any employee benefit plan of the Company in which Employee, at the Date of
Termination, has a vested interest, unless otherwise provided in such employee
benefit plan or any agreement or other instrument attendant thereto.
Notwithstanding the foregoing and in addition to whatever other rights or
remedies the Company may have at law or in equity, all stock options and other
stock-based grants held by Employee, whether vested or unvested as of the Date
of Termination, shall immediately expire on the Date of Termination if
Employee's employment is terminated by the Company for Cause.

          (e)   TERMINATION BY THE COMPANY WITHOUT CAUSE OR BY EMPLOYEE FOR GOOD
REASON.

                (i)      The Company may terminate Employee's employment
hereunder without Cause if such termination is approved by the Chief Executive
Officer or Chairman of the Company. Any termination by the Company of Employee's
employment hereunder which does not (A) constitute a termination for Cause under
Subparagraph (d)(i), (B) result from the death or disability of the Employee
under Subparagraph (b) or (c), or (C) result from the expiration of the Term,
shall be deemed a termination without Cause.

                (ii)     Employee may terminate his employment hereunder for
Good Reason. "GOOD REASON" shall mean: (A) a substantial adverse change, not
consented to by Employee, in the nature or scope of Employee's responsibilities,
authorities, powers, functions, or duties under this Agreement; (B) a breach by
the Company of any of its material obligations hereunder and the failure of the
Company to cure such breach within thirty (30) days after written notice thereof
by Employee; or (C) the involuntary relocation of the Company's offices at which
Employee is principally employed to a location more than fifty (50) miles from
such offices, or the requirement by the Company that Employee be based anywhere
other than the Company's offices at such location on an extended basis, except
for required travel on the

                                        6


Company's business to an extent substantially consistent with Employee's
business travel obligations.

                (iii)    If Employee's employment is terminated by the Company
without Cause or if Employee terminates his employment for Good Reason in
accordance with this Subparagraph (e), then the Company shall, through the Date
of Termination, pay Employee his accrued and unpaid Base Salary and his accrued
and unpaid target bonus prorated for the number of days actually employed in the
then current calendar year. In addition, subject to signing by Employee of a
general release of claims in a form and manner satisfactory to the Company, the
Employee shall be entitled to the following:

                         (A)  Salary continuation in an amount (the "SEVERANCE
AMOUNT") equal to the sum of (x) his annual Base Salary under Subparagraph 3(a)
and (y) the amount of his cash bonus, if any, received in respect of the
immediately preceding year under Subparagraph 3(b). The Severance Amount shall
be paid in equal monthly installments over a twelve (12) month period;

                         (B)  All stock options and other stock-based awards,
granted to Employee after the Effective Date, in which Employee would have
vested if he had remained employed for a period of twelve (12) months commencing
on the Date of Termination, shall vest and become exercisable or nonforfeitable
as of the Date of Termination;

                         (C)  Subject to the Employee's continued copayment of
premium amounts, continued participation for twelve (12) months in the Company's
health insurance plan upon the same terms and conditions in effect on the Date
of Termination, PROVIDED, HOWEVER, that the continuation of health benefits
under this Subparagraph shall reduce and count against Employee's rights under
COBRA; and

                         (D)  Subject to (B) above, all rights and benefits
granted or in effect with respect to Employee under the Stock Option Plan and
agreements with Employee pursuant thereto.

          (f)   VOLUNTARY TERMINATION BY EMPLOYEE. Employee may terminate his
employment hereunder for any reason, including, but not limited to, Good Reason
in accordance with Subparagraph (e)(ii). If Employee's employment is terminated
by Employee other than for Good Reason, then the Company shall, through the Date
of Termination, pay Employee his accrued and unpaid Base Salary. Thereafter, the
Company shall have no further obligations to Employee except as otherwise
expressly provided hereunder; PROVIDED any such termination shall not adversely
affect or alter Employee's rights under any employee benefit plan of the Company
in which Employee, at the Date of Termination, has a vested interest, unless
otherwise provided in such employee benefit plan or any agreement or other
instrument attendant thereto. The vesting and exercise of any stock options and
the forfeitability of any stock-based grants held by Employee shall be governed
by the terms of the Stock Option Plan and the related agreements between
Employee and the Company

          (g)   NO MITIGATION. Without regard to the reason for the termination
of Employee's employment hereunder, Employee shall be under no obligation to
mitigate damages

                                        7


with respect to such termination under any circumstances and in the event
Employee is employed or receives income from any other source, there shall be no
offset against the amounts due from the Company hereunder.

     9.   NONCOMPETITION. Because Employee's services to the Company are special
and because Employee has access to the Company's confidential information,
Employee covenants and agrees that during the Employment Period and until the
end of a one-year period following the termination of Employee's employment with
the Company for any reason, Employee shall not, without the prior written
consent of the Company (which shall be authorized by approval of the Board of
Directors of the Company, including the approval of a majority of the
independent Directors of the Company), directly or indirectly:

          (a)   engage, participate or assist in, either individually or as an
owner, partner, employee, consultant, director, officer, trustee, or agent of
any business that engages or attempts to engage in, directly or indirectly, the
acquisition, development, construction, operation, management, or leasing of any
commercial real estate property in any of the Company's Markets (as hereinafter
defined) at the time of Employee's termination of employment;

          (b)   intentionally interfere with, disrupt or attempt to disrupt the
relationship, contractual or otherwise, between the Company or its affiliates
and any tenant, supplier, contractor, lender, employee, or governmental agency
or authority; or

          (c)   call upon, compete for, solicit, divert, or take away, or
attempt to divert or take away any of the tenants or employees of the Company or
its affiliates, either for himself or for any other business, operation,
corporation, partnership, association, agency, or other person or entity.

     "MARKET" as used herein means an area covering a 25 mile radius around (x)
any property or land owned by the Company, under development by the Company or
with respect to which the Company has an agreement or option to acquire a
property, development or land or (y) any property or development for which the
Company provides third party development or management services; PROVIDED that
for any such property, development or land located in New York City, no such
radial area shall extend beyond New York City.

     This Paragraph 9 shall not be interpreted to prevent Employee from engaging
in Minority Interest Passive Investments or any other activity permitted under
Subparagraph 2(b). This Paragraph 9 shall survive the termination of this
Agreement.

     Notwithstanding anything to the contrary herein, the noncompetition
provision of this Paragraph 9 shall not apply if Employee's employment
terminates after a Change in Control (as defined in the Severance Plan).

     10.  CHANGE IN CONTROL PAYMENTS. Notwithstanding anything to the contrary
in the foregoing, in the event that the Employee's employment terminates after a
Change in Control (as defined in the Severance Plan) under circumstances that
would entitle him to payments and benefits under the Severance Plan, he shall
not be entitled to receive any payments or benefits under this Agreement.

                                        8


     11.  CONFLICTING AGREEMENTS. Employee hereby represents and warrants that
the execution of this Agreement and the performance of his obligations hereunder
will not breach or be in conflict with any other agreement to which he is a
party or is bound, and that he is not now subject to any covenants against
competition or similar covenants which would affect the performance of his
obligations hereunder.

     12.  NOTICES. All notices, requests, demands, and other communications
under this Agreement shall be in writing and shall be deemed duly given (i) if
delivered by hand and receipted for by the party addressee, on the date of such
receipt or (ii) if mailed by domestic certified or registered mail with postage
prepaid, on the third business day after the date postmarked. Address for notice
for the Company is as shown above, or as subsequently modified by written
notice. Address for notice for the Employee is the address shown on the records
of the Company.

     13.  INTEGRATION. This Agreement constitutes the entire agreement between
the parties with respect to the subject matter hereof and supersedes all prior
agreements between the parties with respect to any related subject matter,
provided, however, that the Severance Plan, as amended from time to time, shall
remain in full force and effect hereafter.

     14.  ASSIGNMENT; SUCCESSORS AND ASSIGNS, ETC. Neither the Company nor the
Employee may make any assignment of this Agreement or any interest herein, by
operation of law or otherwise, without the prior written consent of the other
party; provided that the Company may assign its rights under this Agreement
without the consent of the Employee in the event that the Company shall effect a
reorganization, consolidate with or merge into any other corporation,
partnership, organization or other entity, or transfer all or substantially all
of its properties or assets to any other corporation, partnership, organization
or other entity. This Agreement shall inure to the benefit of and be binding
upon the Company and the Employee, their respective successors, executors,
administrators, heirs and permitted assigns.

     15.  MISCELLANEOUS. Headings herein are for convenience of reference only
and shall not define, limit or interpret the contents hereof.

     16.  AMENDMENT. This Agreement may be amended, modified or supplemented by
the mutual consent of the parties in writing, but no oral amendment,
modification or supplement shall be effective.

     17.  ARBITRATION; OTHER DISPUTES. Any dispute or controversy arising under
or in connection with this Agreement shall be settled exclusively by arbitration
in Boston, Massachusetts, in accordance with the rules of the American
Arbitration Association then in effect. Judgment may be entered in any court
having jurisdiction. Notwithstanding the above, the Company shall be entitled to
seek a restraining order or injunction in any court of competent jurisdiction to
prevent any continuation of any violation of Paragraph 7 or 9 hereof. In the
event that the Company terminates Employee's employment for Cause under
Subparagraph 8(d)(i) and Employee contends that Cause did not exist, then the
Company's only obligation shall be to submit such claim to arbitration and the
only issue before the arbitrator will be whether Employee was in fact terminated
for Cause. If the arbitrator determines that Employee was not terminated for
Cause by the Company, then the only remedies that the arbitrator may award are

                                        9


(i) the Severance Amount specified in Subparagraph 8(e)(iii)(A), (ii) the costs
of arbitration, (iii) Employee's reasonable attorneys' fees, (iv) the additional
vesting of Employee's stock options and other stock-based awards in accordance
with Subparagraph 8(e)(iii)(B), and (v) the continued participation in the
Company's health insurance plan in accordance with Subparagraph 8(e)(iii)(C). If
the arbitrator finds that Employee was terminated for Cause, the arbitrator will
be without authority to award Employee anything, and the parties will each be
responsible for their own attorneys' fees, and they will divide the costs of
arbitration equally. Furthermore, should a dispute occur concerning Employee's
mental or physical capacity as described in Subparagraph 8(c), a doctor selected
by Employee and a doctor selected by the Company shall be entitled to examine
Employee. If the opinion of the Company's doctor and Employee's doctor conflict,
the Company's doctor and Employee's doctor shall together agree upon a third
doctor, whose opinion shall be binding. This Paragraph 17 shall survive the
termination of this Agreement.

     18.  LITIGATION AND REGULATORY COOPERATION. During and after Employee's
employment, Employee shall reasonably cooperate with the Company in the defense
or prosecution of any claims or actions now in existence or which may be brought
in the future against or on behalf of the Company which relate to events or
occurrences that transpired while Employee was employed by the Company; provided
that such cooperation shall not materially and adversely affect Employee or
expose Employee to an increased probability of civil or criminal litigation.
Employee's cooperation in connection with such claims or actions shall include,
without limitation, being available to meet with counsel to prepare for
discovery or trial and to act as a witness on behalf of the Company at mutually
convenient times. During and after Employee's employment, Employee also shall
cooperate fully with the Company in connection with any investigation or review
of any federal, state or local regulatory authority as any such investigation or
review relates to events or occurrences that transpired while Employee was
employed by the Company. The Company shall also provide Employee with
compensation on an hourly basis calculated at his final base compensation rate
for requested litigation and regulatory cooperation that occurs after his
termination of employment, and reimburse Employee for all costs and expenses
incurred in connection with his performance under this Paragraph 18, including,
without limitation, reasonable attorneys' fees and costs.

     19.  SEVERABILITY. If any provision of this Agreement shall to any extent
be held void or unenforceable (as to duration, scope, activity, subject or
otherwise) by a court of competent jurisdiction, such provision shall be deemed
to be modified so as to constitute a provision conforming as nearly as possible
to the original provision while still remaining valid and enforceable. In such
event, the remainder of this Agreement (or the application of such provision to
persons or circumstances other than those in respect of which it is deemed to be
void or unenforceable) shall not be affected thereby. Each other provision of
this Agreement, unless specifically conditioned on the voided aspect of such
provision, shall remain valid and enforceable to the fullest extent permitted by
law; any other provisions of this Agreement that are specifically conditioned on
the voided aspect of such invalid provision shall also be deemed to be modified
so as to constitute a provision conforming as nearly as possible to the original
provision while still remaining valid and enforceable to the fullest extent
permitted by law.

     20.  GOVERNING LAW. This Agreement shall be construed and regulated in all
respects under the laws of the State of Delaware.

                                       10


     21.  COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be taken to be
an original; but such counterparts shall together constitute one and the same
document.

                                       11


     IN WITNESS WHEREOF, this Agreement is entered into as of the date and year
first above written.

                                         BOSTON PROPERTIES, INC.

                                         By: /s/ Edward H. Linde
                                            ------------------------------------
                                             Name:  Edward H. Linde
                                             Title: President and
                                                    Chief Executive Officer


                                         /s/ E. Mitchell Norville
                                         ---------------------------------------
                                         E. Mitchell Norville

                                       12



                                                                   EXHIBIT 10.14

                              EMPLOYMENT AGREEMENT

     THIS AGREEMENT (the "AGREEMENT") is made as of the 16th day of December,
2002 (the "EFFECTIVE DATE"), by and between Robert E. Pester (the "EMPLOYEE")
and Boston Properties, Inc., a Delaware corporation, with its principal
executive office located at 111 Huntington Avenue, Suite 300, Boston,
Massachusetts 02199-7610 (together with its subsidiaries, the "COMPANY").

                                WITNESSETH THAT:

     WHEREAS, the Company has determined that it is in its best interest to
continue the employment of the Employee on the terms hereinafter set forth;

     WHEREAS, the Employee wishes to be so employed pursuant to the terms
hereinafter set forth;

     WHEREAS, the Company has adopted that certain Senior Executive Severance
Plan, effective as of July 30, 1998 (the "SEVERANCE PLAN"), as may be amended
from time to time, and which the parties desire to remain in full force and
effect after the date hereof;

     NOW, THEREFORE, in consideration of the mutual covenants and premises set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Employee
hereby agree as follows:

     1.   TERM. Subject to the provisions of Paragraph 8, the term of employment
pursuant to this Agreement (the "TERM") shall be two (2) years from the
Effective Date and shall be renewed automatically for periods of one (1) year
commencing at each anniversary of the Effective Date, unless written notice is
given by either party to the other not less than ninety (90) days prior to any
such anniversary of such party's election not to extend the Term.

     2.   EMPLOYMENT; DUTIES; LOCATION.

          (a)   Employee shall initially serve as an officer of the Company with
the title Senior Vice President, Regional Manager. Employee's duties and
authority shall be commensurate with his title and position with the Company.
The Employee shall report directly to the Executive Vice President for
Operations and shall serve the Company in such other capacity or capacities as
the Employee may be requested to serve by the Board of Directors of the Company
(the "BOARD OF DIRECTORS"). In such capacity or capacities, the Employee shall
perform such services and duties in connection with the business, affairs and
operations of the Company as may be assigned or delegated to the Employee from
time to time by or under the authority of the Board of Directors. The Employee
shall be principally located at the Company's San Francisco office.

          (b)   Employee agrees to his employment as described in this Paragraph
2 and agrees to devote substantially ALL of his working time and efforts to the
performance of his duties hereunder, except as otherwise approved by the Board
of Directors. Notwithstanding the foregoing, nothing herein shall be interpreted
to preclude Employee from (i) engaging in



Minority Interest Passive Investments (as defined below), including Minority
Interest Passive Investments in, or relating to the ownership, development,
operation, management, or leasing of, commercial real estate properties or (ii)
participating as an officer or director of, or advisor to, any charitable or
other tax exempt organization; PROVIDED that such activities and related duties
and pursuits do not restrict Employee's ability to fulfill his obligations as an
officer and employee of the Company as set forth herein.

     Engaging in a "MINORITY INTEREST PASSIVE INVESTMENT" means acquiring,
holding, and exercising the voting rights associated with an investment made
through (i) the purchase of securities (including partnership interests) that
represent a non-controlling, minority interest in an entity or (ii) the lending
of money, in either case with the purpose or intent of obtaining a return on
such investment but without management by Employee of the property or business
to which such investment directly or indirectly relates and without any business
or strategic consultation by Employee with such entity.

     3.   COMPENSATION.

          (a)   BASE SALARY. The Company shall pay Employee an annual salary of
Two Hundred Eighty-Five Thousand Dollars ($285,000) (the "BASE SALARY"), payable
in accordance with the Company's normal business practices for senior executives
(including tax withholding), but in no event less frequently than monthly.
Employee's Base Salary shall be reviewed at least annually by the Board of
Directors or the Compensation Committee of the Board of Directors (the
"COMPENSATION COMMITTEE") and may be increased but not decreased in its
discretion.

          (b)   BONUS. On each annual compensation determination date
established by the Company during the Term, the Company shall review the
performance of the Company and of Employee during the prior year, and the
Company may provide Employee with additional compensation as a bonus if the
Board of Directors, or the Compensation Committee, in its discretion, determines
that Employee's contribution to the Company warrants such additional payment and
the Company's anticipated financial performance for the present period permits
such payment.

     4.   BENEFITS.

          (a)   MEDICAL/DENTAL INSURANCE. Employee shall be entitled to
participate in any and all employee benefit plans, including all medical and
dental insurance plans as in effect from time to time for senior executives of
the Company. Such participation shall be subject to (i) the terms of the
applicable plan documents, (ii) generally applicable policies of the Company,
and (iii) the discretion of the Board of Directors, the Compensation Committee
or any administrative or other committee provided for in, or contemplated by,
such plan. Nothing contained in this Agreement shall be construed to create any
obligation on the part of the Company to establish any such plan or to maintain
the effectiveness of any such plan which may be in effect from time to time.

          (b)   LIFE INSURANCE/DISABILITY INSURANCE. The Company shall provide
Employee with such life and/or disability insurance as the Company may from time
to time make available to senior executives of the Company.

                                        2


          (c)   EXPENSES. The Company shall promptly reimburse Employee for all
reasonable business expenses incurred by Employee in accordance with the
practices of the Company for senior executives of the Company, as in effect from
time to time.

          (d)   VACATION. Employee shall receive paid vacation annually in
accordance with terms determined for such Employee by the Company, but in no
event shall Employee receive less than four weeks of paid vacation per year.

          (e)   STOCK OPTIONS; RESTRICTED STOCK. Employee shall be entitled to
grants of stock options and restricted stock awards in an amount to be
determined by the Compensation Committee in its discretion under the Boston
Properties, Inc. 1997 Stock Option and Incentive Plan or any other stock option
plan adopted by the Company from time to time (the "STOCK OPTION PLAN").

          (f)   DEFERRED COMPENSATION. Employee shall be entitled to participate
in any deferred compensation plan or arrangement that the Company may have in
place for its senior executives and/or officers.

          (g)   AUTOMOBILE. The Company shall provide Employee with an
automobile allowance of Seven Hundred Fifty Dollars ($750) per month, such
amount to be increased from time to time in the Company's sole discretion and to
be paid to Employee no less frequently than monthly.

          (h)   OTHER BENEFITS. The Company shall provide to Employee such other
benefits, including the right to participate in such retirement or pension
plans, as are made generally available to senior executives of the Company from
time to time. Such participation shall be subject to (i) the terms of the
applicable plan documents, (ii) generally applicable policies of the Company,
and (iii) the discretion of the Board of Directors, the Compensation Committee,
or any administrative or other committee provided for in, or contemplated by,
such plan.

          (i)   TAXATION OF PAYMENTS AND BENEFITS. The Company shall undertake
to make deductions, withholdings and tax reports with respect to payments and
benefits under this Agreement to the extent that it reasonably and in good faith
believes that it is required to make such deductions, withholdings and tax
reports. Payments under this Agreement shall be in amounts net of any such
deductions or withholdings. Nothing in this Agreement shall be construed to
require the Company to make any payments to compensate the Employee for any
adverse tax effect associated with any payments or benefits or for any deduction
or withholding from any payment or benefit.

     5.   INDEMNIFICATION. To the full extent permitted by law and subject to
the Company's Certificate of Incorporation and Bylaws, the Company shall
indemnify Employee with respect to any actions commenced against Employee in his
capacity as a director or officer or former director or officer of the Company,
or any affiliate thereof for which he may serve in such capacity, and the
Company shall advance on a timely basis any expenses incurred in defending such
actions. The obligation to indemnify hereunder shall survive the termination of

                                        3


this Agreement. The Company agrees to use its best efforts to secure and
maintain directors' and officers' liability insurance with respect to Employee.

     6.   COMPANY AUTHORITY/POLICIES. Employee agrees to observe and comply with
the rules and regulations of the Company as adopted by its Board of Directors
respecting the performance of his duties and to carry out and perform orders,
directions and policies communicated to him from time to time by the Board of
Directors.

     7.   RECORDS/NONDISCLOSURE/COMPANY POLICIES.

          (a)   GENERAL. All records, financial statements and similar documents
obtained, reviewed or compiled by Employee in the course of the performance by
him of services for the Company, whether or not confidential information or
trade secrets, shall be the exclusive property of the Company. Employee shall
have no rights in such documents upon any termination of this Agreement.

          (b)   CONFIDENTIAL INFORMATION. Employee will not disclose to any
person or entity (except as required by applicable law, the rules of the New
York Stock Exchange, or otherwise in connection with the performance of his
duties and responsibilities hereunder), or use for his own benefit or gain, any
confidential information of the Company obtained by him incident to his
employment with the Company. Employee shall take all reasonable steps to
safeguard any confidential information and to protect such confidential
information against disclosure, misuse, loss, or theft. The term "CONFIDENTIAL
INFORMATION" includes, without limitation, financial information, business
plans, prospects, and opportunities which have been discussed or considered by
the management of the Company, but does not include any information which has
become part of the public domain by means other than Employee's non-observance
of his obligations hereunder.

     This Paragraph 7 shall survive the termination of this Agreement.

     8.   TERMINATION/SEVERANCE.

          (a)   GENERAL.

                (i)      AT WILL EMPLOYMENT. Employee's employment hereunder is
"at will" and, therefore, may be terminated at any time, with or without cause,
at the option of the Company, subject only to the severance obligations under
this Paragraph 8.

                (ii)     NOTICE OF TERMINATION. Except for termination as a
result of Employee's death as specified in Subparagraph 8(b), any termination of
Employee's employment by the Company or any such termination by Employee shall
be communicated by written Notice of Termination to the other party hereto. For
purposes of this Agreement, a "NOTICE OF TERMINATION" shall mean a notice which
shall indicate the specific termination provision hereunder relied upon by the
terminating party.

                (iii)    DATE OF TERMINATION. "DATE OF TERMINATION" shall mean:
(A) if Employee's employment is terminated by his death, the date of his death;
(B) if Employee's employment is terminated on account of disability under
Subparagraph 8(c), the date on which

                                        4


Notice of Termination is given; (C) if Employee's employment is terminated by
the Company for Cause under Subparagraph 8(d), the date on which a Notice of
Termination is given; (D) if Employee's employment is terminated by the Company
without Cause under Subparagraph 8(e)(i), thirty (30) days after the date on
which a Notice of Termination is given; and (E) if Employee's employment is
terminated by Employee under Subparagraph 8(e)(ii) or 8(f), thirty (30) days
after the date on which a Notice of Termination is given.

          (b)   DEATH. Employee's employment hereunder shall terminate upon his
death. If Employee's employment terminates by reason of his death, the Company
shall, within ninety (90) days of death, pay in a lump sum amount to such person
as Employee shall designate in a notice filed with the Company or, if no such
person is designated, to Employee's estate, Employee's accrued and unpaid Base
Salary to his date of death, plus his accrued and unpaid target bonus, prorated
for the number of days actually employed in the then current calendar year. All
unvested stock options and stock-based grants shall immediately vest in
Employee's estate or other legal representatives and become exercisable or
nonforfeitable, and Employee's estate or other legal representatives shall have
such period of time to exercise the stock options as is provided in the Stock
Option Plan and agreements with Employee pursuant thereto. For a period of
eighteen (18) months following the Date of Termination, and subject to the
continued copayment of premium amounts by the Employee's spouse and dependents,
the Employee's spouse and dependents shall continue to participate in the
Company's health insurance plan upon the same terms and conditions in effect on
the Date of Termination, PROVIDED, HOWEVER, that the continuation of health
benefits under this Subparagraph shall reduce and count against the rights of
the Employee's spouse and dependents under the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended ("COBRA"). In addition to the foregoing,
any payments to which Employee's spouse, beneficiaries, or estate may be
entitled under any employee benefit plan shall also be paid in accordance with
the terms of such plan or arrangement. Such payments, in the aggregate, shall
fully discharge the Company's obligations hereunder.

          (c)   DISABILITY. If, as a result of Employee's incapacity due to
physical or mental illness, Employee shall have been absent from his duties
hereunder on a full-time basis for one hundred eighty (180) calendar days in the
aggregate in any twelve (12) month period, the Company may terminate Employee's
employment hereunder. During any period that Employee fails to perform his
duties hereunder as a result of incapacity due to physical or mental illness,
Employee shall continue to receive his accrued and unpaid Base Salary and
accrued and unpaid target bonus, prorated for the number of days actually
employed in the then current calendar year, until Employee's employment is
terminated due to disability in accordance with this Subparagraph (c) or until
Employee terminates his employment in accordance with Subparagraph (e)(ii) or
(f), if earlier. All unvested stock options and stock-based grants shall
immediately vest and become exercisable or nonforfeitable, and Employee shall
have such period of time to exercise the stock options as is provided in the
Stock Option Plan and agreements with Employee pursuant thereto. For a period of
eighteen (18) months following the Date of Termination and subject to the
Employee's continued copayment of premium amounts, the Employee, Employee's
spouse and dependents shall continue to participate in the Company's health
insurance plan upon the same terms and conditions in effect on the Date of
Termination, PROVIDED, HOWEVER, that the continuation of health benefits under
this Subparagraph shall reduce and count against Employee's rights under COBRA.
In addition to the foregoing, any payments

                                        5


to which Employee may be entitled under any employee benefit plan shall also be
paid in accordance with the terms of such plan or arrangement. Such payments, in
the aggregate, shall fully discharge the Company's obligations hereunder.

          (d)   TERMINATION BY THE COMPANY FOR CAUSE.

                (i)      The Company may terminate Employee's employment
hereunder for Cause. "CAUSE" shall mean: (A) gross negligence or willful
misconduct by Employee in connection with the performance of his material duties
hereunder; (B) a breach by Employee of any of his material duties hereunder (for
reasons other than physical or mental illness) and the failure of Employee to
cure such breach within thirty (30) days after written notice thereof by the
Company; (C) conduct by Employee against the material best interests of the
Company or a material act of common law fraud against the Company or its
affiliates or employees; or (D) indictment of Employee of a felony and such
indictment has a material adverse affect on the interests or reputation of the
Company.

                (ii)     If Employee's employment is terminated by the Company
for Cause, then the Company shall, through the Date of Termination, pay Employee
his accrued and unpaid Base Salary. Thereafter, the Company shall have no
further obligations to Employee except as otherwise provided hereunder; PROVIDED
that any such termination shall not adversely affect or alter Employee's rights
under any employee benefit plan of the Company in which Employee, at the Date of
Termination, has a vested interest, unless otherwise provided in such employee
benefit plan or any agreement or other instrument attendant thereto.
Notwithstanding the foregoing and in addition to whatever other rights or
remedies the Company may have at law or in equity, all stock options and other
stock-based grants held by Employee, whether vested or unvested as of the Date
of Termination, shall immediately expire on the Date of Termination if
Employee's employment is terminated by the Company for Cause.

          (e)   TERMINATION BY THE COMPANY WITHOUT CAUSE OR BY EMPLOYEE FOR GOOD
REASON.

                (i)      The Company may terminate Employee's employment
hereunder without Cause if such termination is approved by the Chief Executive
Officer or Chairman of the Company. Any termination by the Company of Employee's
employment hereunder which does not (A) constitute a termination for Cause under
Subparagraph (d)(i), (B) result from the death or disability of the Employee
under Subparagraph (b) or (c), or (C) result from the expiration of the Term,
shall be deemed a termination without Cause.

                (ii)     Employee may terminate his employment hereunder for
Good Reason. "GOOD REASON" shall mean: (A) a substantial adverse change, not
consented to by Employee, in the nature or scope of Employee's responsibilities,
authorities, powers, functions, or duties under this Agreement; (B) a breach by
the Company of any of its material obligations hereunder and the failure of the
Company to cure such breach within thirty (30) days after written notice thereof
by Employee; or (C) the involuntary relocation of the Company's offices at which
Employee is principally employed to a location more than fifty (50) miles from
such offices, or the requirement by the Company that Employee be based anywhere
other than the Company's offices at such location on an extended basis, except
for required travel on the

                                        6


Company's business to an extent substantially consistent with Employee's
business travel obligations.

                (iii)    If Employee's employment is terminated by the Company
without Cause or if Employee terminates his employment for Good Reason in
accordance with this Subparagraph (e), then the Company shall, through the Date
of Termination, pay Employee his accrued and unpaid Base Salary and his accrued
and unpaid target bonus prorated for the number of days actually employed in the
then current calendar year. In addition, subject to signing by Employee of a
general release of claims in a form and manner satisfactory to the Company, the
Employee shall be entitled to the following:

                         (A)  Salary continuation in an amount (the "SEVERANCE
AMOUNT") equal to the sum of (x) his annual Base Salary under Subparagraph 3(a)
and (y) the amount of his cash bonus, if any, received in respect of the
immediately preceding year under Subparagraph 3(b). The Severance Amount shall
be paid in equal monthly installments over a twelve (12) month period;

                         (B)  All stock options and other stock-based awards,
granted to Employee after the Effective Date, in which Employee would have
vested if he had remained employed for a period of twelve (12) months commencing
on the Date of Termination, shall vest and become exercisable or nonforfeitable
as of the Date of Termination;

                         (C)  Subject to the Employee's continued copayment of
premium amounts, continued participation for twelve (12) months in the Company's
health insurance plan upon the same terms and conditions in effect on the Date
of Termination, PROVIDED, HOWEVER, that the continuation of health benefits
under this Subparagraph shall reduce and count against Employee's rights under
COBRA; and

                         (D)  Subject to (B) above, all rights and benefits
granted or in effect with respect to Employee under the Stock Option Plan and
agreements with Employee pursuant thereto.

          (f)   VOLUNTARY TERMINATION BY EMPLOYEE. Employee may terminate his
employment hereunder for any reason, including, but not limited to, Good Reason
in accordance with Subparagraph (e)(ii). If Employee's employment is terminated
by Employee other than for Good Reason, then the Company shall, through the Date
of Termination, pay Employee his accrued and unpaid Base Salary. Thereafter, the
Company shall have no further obligations to Employee except as otherwise
expressly provided hereunder; PROVIDED any such termination shall not adversely
affect or alter Employee's rights under any employee benefit plan of the Company
in which Employee, at the Date of Termination, has a vested interest, unless
otherwise provided in such employee benefit plan or any agreement or other
instrument attendant thereto. The vesting and exercise of any stock options and
the forfeitability of any stock-based grants held by Employee shall be governed
by the terms of the Stock Option Plan and the related agreements between
Employee and the Company

          (g)   NO MITIGATION. Without regard to the reason for the termination
of Employee's employment hereunder, Employee shall be under no obligation to
mitigate damages

                                        7


with respect to such termination under any circumstances and in the event
Employee is employed or receives income from any other source, there shall be no
offset against the amounts due from the Company hereunder.

     9.   NONCOMPETITION. Because Employee's services to the Company are special
and because Employee has access to the Company's confidential information,
Employee covenants and agrees that during the Employment Period and until the
end of a one-year period following the termination of Employee's employment with
the Company for any reason, Employee shall not, without the prior written
consent of the Company (which shall be authorized by approval of the Board of
Directors of the Company, including the approval of a majority of the
independent Directors of the Company), directly or indirectly:

          (a)   intentionally interfere with, disrupt or attempt to disrupt the
relationship, contractual or otherwise, between the Company or its affiliates
and any supplier, contractor, lender, employee, or governmental agency or
authority; or

          (b)   call upon, compete for, solicit, divert, or take away, or
attempt to divert or take away any of the employees of the Company or its
affiliates, either for himself or for any other business, operation,
corporation, partnership, association, agency, or other person or entity.

     Employee acknowledges that the foregoing restrictions are necessary to
protect the confidential information of the Company and its affiliates.

     This Paragraph 9 shall survive the termination of this Agreement.

     Notwithstanding anything to the contrary herein, the noncompetition
provision of this Paragraph 9 shall not apply if Employee's employment
terminates after a Change in Control (as defined in the Severance Plan).

     10.  CHANGE IN CONTROL PAYMENTS. Notwithstanding anything to the contrary
in the foregoing, in the event that the Employee's employment terminates after a
Change in Control (as defined in the Severance Plan) under circumstances that
would entitle him to payments and benefits under the Severance Plan, he shall
not be entitled to receive any payments or benefits under this Agreement.

     11.  CONFLICTING AGREEMENTS. Employee hereby represents and warrants that
the execution of this Agreement and the performance of his obligations hereunder
will not breach or be in conflict with any other agreement to which he is a
party or is bound, and that he is not now subject to any covenants against
competition or similar covenants which would affect the performance of his
obligations hereunder.

     12.  NOTICES. All notices, requests, demands, and other communications
under this Agreement shall be in writing and shall be deemed duly given (i) if
delivered by hand and receipted for by the party addressee, on the date of such
receipt or (ii) if mailed by domestic certified or registered mail with postage
prepaid, on the third business day after the date postmarked. Address for notice
for the Company is as shown above, or as subsequently modified by written
notice. Address for notice for the Employee is the address shown on the records
of the Company.

                                        8


     13.  INTEGRATION. This Agreement constitutes the entire agreement between
the parties with respect to the subject matter hereof and supersedes all prior
agreements between the parties with respect to any related subject matter,
provided, however, that the Severance Plan, as amended from time to time, shall
remain in full force and effect hereafter.

     14.  ASSIGNMENT; SUCCESSORS AND ASSIGNS, ETC. Neither the Company nor the
Employee may make any assignment of this Agreement or any interest herein, by
operation of law or otherwise, without the prior written consent of the other
party; provided that the Company may assign its rights under this Agreement
without the consent of the Employee in the event that the Company shall effect a
reorganization, consolidate with or merge into any other corporation,
partnership, organization or other entity, or transfer all or substantially all
of its properties or assets to any other corporation, partnership, organization
or other entity. This Agreement shall inure to the benefit of and be binding
upon the Company and the Employee, their respective successors, executors,
administrators, heirs and permitted assigns.

     15.  MISCELLANEOUS. Headings herein are for convenience of reference only
and shall not define, limit or interpret the contents hereof.

     16.  AMENDMENT. This Agreement may be amended, modified or supplemented by
the mutual consent of the parties in writing, but no oral amendment,
modification or supplement shall be effective.

     17.  ARBITRATION; OTHER DISPUTES. Any dispute or controversy arising under
or in connection with this Agreement, including without limitation any claims
arising under the California Fair Employment and Housing Act, shall be settled
exclusively by arbitration in accordance with the Employment Resolution Dispute
Rules of the American Arbitration Association then in effect. Judgment may be
entered in any court having jurisdiction. Notwithstanding the above, the Company
shall be entitled to seek a restraining order or injunction in any court of
competent jurisdiction to prevent any continuation of any violation of Paragraph
7 or 9 hereof. This Paragraph 17 shall survive the termination of this
Agreement.

     18.  LITIGATION AND REGULATORY COOPERATION. During and after Employee's
employment, Employee shall reasonably cooperate with the Company in the defense
or prosecution of any claims or actions now in existence or which may be brought
in the future against or on behalf of the Company which relate to events or
occurrences that transpired while Employee was employed by the Company; provided
that such cooperation shall not materially and adversely affect Employee or
expose Employee to an increased probability of civil or criminal litigation.
Employee's cooperation in connection with such claims or actions shall include,
without limitation, being available to meet with counsel to prepare for
discovery or trial and to act as a witness on behalf of the Company at mutually
convenient times. During and after Employee's employment, Employee also shall
cooperate fully with the Company in connection with any investigation or review
of any federal, state or local regulatory authority as any such investigation or
review relates to events or occurrences that transpired while Employee was
employed by the Company. The Company shall also provide Employee with
compensation on an hourly basis calculated at his final base compensation rate
for requested litigation and regulatory cooperation that occurs after his
termination of employment, and reimburse Employee

                                        9


for all costs and expenses incurred in connection with his performance under
this Paragraph 18, including, without limitation, reasonable attorneys' fees and
costs.

     19.  SEVERABILITY. If any provision of this Agreement shall to any extent
be held void or unenforceable (as to duration, scope, activity, subject or
otherwise) by a court of competent jurisdiction, such provision shall be deemed
to be modified so as to constitute a provision conforming as nearly as possible
to the original provision while still remaining valid and enforceable. In such
event, the remainder of this Agreement (or the application of such provision to
persons or circumstances other than those in respect of which it is deemed to be
void or unenforceable) shall not be affected thereby. Each other provision of
this Agreement, unless specifically conditioned on the voided aspect of such
provision, shall remain valid and enforceable to the fullest extent permitted by
law; any other provisions of this Agreement that are specifically conditioned on
the voided aspect of such invalid provision shall also be deemed to be modified
so as to constitute a provision conforming as nearly as possible to the original
provision while still remaining valid and enforceable to the fullest extent
permitted by law.

     20.  GOVERNING LAW. This Agreement shall be construed and regulated in all
respects under the laws of the State of Delaware.

     21.  COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be taken to be
an original; but such counterparts shall together constitute one and the same
document.

     IN WITNESS WHEREOF, this Agreement is entered into as of the date and year
first above written.

                                         BOSTON PROPERTIES, INC.

                                         By: /s/ Edward H. Linde
                                            ------------------------------------
                                             Name:  Edward H. Linde
                                             Title: President and
                                                    Chief Executive Officer


                                         /s/ Robert E. Pester
                                         ---------------------------------------
                                         Robert E. Pester

                                       10



                                                                   EXHIBIT 10.15

                              AMENDED AND RESTATED
                              EMPLOYMENT AGREEMENT

     THIS AGREEMENT (the "AGREEMENT") is made as of the 29th day of November,
2002 (the "EFFECTIVE DATE"), by and between Raymond A. Ritchey (the "EMPLOYEE")
and Boston Properties, Inc., a Delaware corporation, with its principal
executive office located at 111 Huntington Avenue, Suite 300, Boston,
Massachusetts 02199-7610 (together with its subsidiaries, the "COMPANY").

                                WITNESSETH THAT:

     WHEREAS, the Company and the Employee have entered into that certain
Employment Agreement, dated as of June 23, 1997, which agreement the parties
desire to be amended, restated and superseded in its entirety by this Agreement;

     WHEREAS, the Company has determined that it is in its best interest to
continue the employment of the Employee on the terms hereinafter set forth;

     WHEREAS, the Employee wishes to be so employed pursuant to the terms
hereinafter set forth;

     WHEREAS, the Company has adopted that certain Senior Executive Severance
Plan, effective as of July 30, 1998 (the "SEVERANCE PLAN"), as may be amended
from time to time, and which the parties desire to remain in full force and
effect after the date hereof;

     NOW, THEREFORE, in consideration of the mutual covenants and premises set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Employee
hereby agree as follows:

     1.   TERM. Subject to the provisions of Paragraph 8, the term of employment
pursuant to this Agreement (the "TERM") shall be two (2) years from the
Effective Date and shall be renewed automatically for periods of one (1) year
commencing at each anniversary of the Effective Date, unless written notice is
given by either party to the other not less than ninety (90) days prior to any
such anniversary of such party's election not to extend the Term.

     2.   EMPLOYMENT; DUTIES; LOCATION.

          (a)   Employee shall initially serve as an officer of the Company with
the title Executive Vice President. Employee's duties and authority shall be
commensurate with his title and position with the Company. The Employee shall
report directly to the Chief Executive Officer and/or President and shall serve
the Company in such other capacity or capacities as the Employee may be
requested to serve by the Board of Directors of the Company (the "BOARD OF
DIRECTORS"). In such capacity or capacities, the Employee shall perform such
services and duties in connection with the business, affairs and operations of
the Company as may be assigned or delegated to the Employee from time to time by
or under the authority of the Board of Directors. The Employee shall be
principally located at the Company's Washington, D.C. office.



          (b)   Employee agrees to his employment as described in this Paragraph
2 and agrees to devote substantially ALL of his working time and efforts to the
performance of his duties hereunder, except as otherwise approved by the Board
of Directors. Notwithstanding the foregoing, nothing herein shall be interpreted
to preclude Employee from (i) engaging in Minority Interest Passive Investments
(as defined below), including Minority Interest Passive Investments in, or
relating to the ownership, development, operation, management, or leasing of,
commercial real estate properties or (ii) participating as an officer or
director of, or advisor to, any charitable or other tax exempt organization;
PROVIDED that such activities and related duties and pursuits do not restrict
Employee's ability to fulfill his obligations as an officer and employee of the
Company as set forth herein.

     Engaging in a "MINORITY INTEREST PASSIVE INVESTMENT" means acquiring,
holding, and exercising the voting rights associated with an investment made
through (i) the purchase of securities (including partnership interests) that
represent a non-controlling, minority interest in an entity or (ii) the lending
of money, in either case with the purpose or intent of obtaining a return on
such investment but without management by Employee of the property or business
to which such investment directly or indirectly relates and without any business
or strategic consultation by Employee with such entity.

     3.   COMPENSATION.

          (a)   BASE SALARY. The Company shall pay Employee an annual salary of
Four Hundred Thousand Dollars ($400,000) (the "BASE SALARY"), payable in
accordance with the Company's normal business practices for senior executives
(including tax withholding), but in no event less frequently than monthly.
Employee's Base Salary shall be reviewed at least annually by the Board of
Directors or the Compensation Committee of the Board of Directors (the
"COMPENSATION COMMITTEE") and may be increased but not decreased in its
discretion.

          (b)   BONUS. On each annual compensation determination date
established by the Company during the Term, the Company shall review the
performance of the Company and of Employee during the prior year, and the
Company may provide Employee with additional compensation as a bonus if the
Board of Directors, or the Compensation Committee, in its discretion, determines
that Employee's contribution to the Company warrants such additional payment and
the Company's anticipated financial performance for the present period permits
such payment.

     4.   BENEFITS.

          (a)   MEDICAL/DENTAL INSURANCE. Employee shall be entitled to
participate in any and all employee benefit plans, including all medical and
dental insurance plans as in effect from time to time for senior executives of
the Company. Such participation shall be subject to (i) the terms of the
applicable plan documents, (ii) generally applicable policies of the Company,
and (iii) the discretion of the Board of Directors, the Compensation Committee
or any administrative or other committee provided for in, or contemplated by,
such plan. Nothing contained in this Agreement shall be construed to create any
obligation on the part of the Company to establish any such plan or to maintain
the effectiveness of any such plan which may be in effect from time to time.

                                        2


          (b)   LIFE INSURANCE/DISABILITY INSURANCE. The Company shall provide
Employee with such life and/or disability insurance as the Company may from time
to time make available to senior executives of the Company.

          (c)   EXPENSES. The Company shall promptly reimburse Employee for all
reasonable business expenses incurred by Employee in accordance with the
practices of the Company for senior executives of the Company, as in effect from
time to time.

          (d)   VACATION. Employee shall receive paid vacation annually in
accordance with terms determined for such Employee by the Company, but in no
event shall Employee receive less than four weeks of paid vacation per year.

          (e)   STOCK OPTIONS; RESTRICTED STOCK. Employee shall be entitled to
grants of stock options and restricted stock awards in an amount to be
determined by the Compensation Committee in its discretion under the Boston
Properties, Inc. 1997 Stock Option and Incentive Plan or any other stock option
plan adopted by the Company from time to time (the "STOCK OPTION PLAN").

          (f)   DEFERRED COMPENSATION. Employee shall be entitled to participate
in any deferred compensation plan or arrangement that the Company may have in
place for its senior executives and/or officers.

          (g)   AUTOMOBILE. The Company shall provide Employee with an
automobile allowance of Seven Hundred Fifty Dollars ($750) per month, such
amount to be increased from time to time in the Company's sole discretion and to
be paid to Employee no less frequently than monthly.

          (h)   OTHER BENEFITS. The Company shall provide to Employee such other
benefits, including the right to participate in such retirement or pension
plans, as are made generally available to senior executives of the Company from
time to time. Such participation shall be subject to (i) the terms of the
applicable plan documents, (ii) generally applicable policies of the Company,
and (iii) the discretion of the Board of Directors, the Compensation Committee,
or any administrative or other committee provided for in, or contemplated by,
such plan.

          (i)   TAXATION OF PAYMENTS AND BENEFITS. The Company shall undertake
to make deductions, withholdings and tax reports with respect to payments and
benefits under this Agreement to the extent that it reasonably and in good faith
believes that it is required to make such deductions, withholdings and tax
reports. Payments under this Agreement shall be in amounts net of any such
deductions or withholdings. Nothing in this Agreement shall be construed to
require the Company to make any payments to compensate the Employee for any
adverse tax effect associated with any payments or benefits or for any deduction
or withholding from any payment or benefit.

     5.   INDEMNIFICATION. To the full extent permitted by law and subject to
the Company's Certificate of Incorporation and Bylaws, the Company shall
indemnify Employee with respect to any actions commenced against Employee in his
capacity as a director or officer or former director or officer of the Company,
or any affiliate thereof for which he may serve in

                                        3


such capacity, and the Company shall advance on a timely basis any expenses
incurred in defending such actions. The obligation to indemnify hereunder shall
survive the termination of this Agreement. The Company agrees to use its best
efforts to secure and maintain directors' and officers' liability insurance with
respect to Employee.

     6.   COMPANY AUTHORITY/POLICIES. Employee agrees to observe and comply with
the rules and regulations of the Company as adopted by its Board of Directors
respecting the performance of his duties and to carry out and perform orders,
directions and policies communicated to him from time to time by the Board of
Directors.

     7.   RECORDS/NONDISCLOSURE/COMPANY POLICIES.

          (a)   GENERAL. All records, financial statements and similar documents
obtained, reviewed or compiled by Employee in the course of the performance by
him of services for the Company, whether or not confidential information or
trade secrets, shall be the exclusive property of the Company. Employee shall
have no rights in such documents upon any termination of this Agreement.

          (b)   CONFIDENTIAL INFORMATION. Employee will not disclose to any
person or entity (except as required by applicable law, the rules of the New
York Stock Exchange, or otherwise in connection with the performance of his
duties and responsibilities hereunder), or use for his own benefit or gain, any
confidential information of the Company obtained by him incident to his
employment with the Company. Employee shall take all reasonable steps to
safeguard any confidential information and to protect such confidential
information against disclosure, misuse, loss, or theft. The term "CONFIDENTIAL
INFORMATION" includes, without limitation, financial information, business
plans, prospects, and opportunities which have been discussed or considered by
the management of the Company, but does not include any information which has
become part of the public domain by means other than Employee's non-observance
of his obligations hereunder.

     This Paragraph 7 shall survive the termination of this Agreement.

     8.   TERMINATION/SEVERANCE.

          (a)   GENERAL.

                (i)      AT WILL EMPLOYMENT. Employee's employment hereunder is
"at will" and, therefore, may be terminated at any time, with or without cause,
at the option of the Company, subject only to the severance obligations under
this Paragraph 8.

                (ii)     NOTICE OF TERMINATION. Except for termination as a
result of Employee's death as specified in Subparagraph 8(b), any termination of
Employee's employment by the Company or any such termination by Employee shall
be communicated by written Notice of Termination to the other party hereto. For
purposes of this Agreement, a "NOTICE OF TERMINATION" shall mean a notice which
shall indicate the specific termination provision hereunder relied upon by the
terminating party.

                                        4


                (iii)    DATE OF TERMINATION. "DATE OF TERMINATION" shall mean:
(A) if Employee's employment is terminated by his death, the date of his death;
(B) if Employee's employment is terminated on account of disability under
Subparagraph 8(c), the date on which Notice of Termination is given; (C) if
Employee's employment is terminated by the Company for Cause under Subparagraph
8(d), the date on which a Notice of Termination is given; (D) if Employee's
employment is terminated by the Company without Cause under Subparagraph
8(e)(i), thirty (30) days after the date on which a Notice of Termination is
given; and (E) if Employee's employment is terminated by Employee under
Subparagraph 8(e)(ii) or 8(f), thirty (30) days after the date on which a Notice
of Termination is given.

          (b)   DEATH. Employee's employment hereunder shall terminate upon his
death. If Employee's employment terminates by reason of his death, the Company
shall, within ninety (90) days of death, pay in a lump sum amount to such person
as Employee shall designate in a notice filed with the Company or, if no such
person is designated, to Employee's estate, Employee's accrued and unpaid Base
Salary to his date of death, plus his accrued and unpaid target bonus, prorated
for the number of days actually employed in the then current calendar year. All
unvested stock options and stock-based grants shall immediately vest in
Employee's estate or other legal representatives and become exercisable or
nonforfeitable, and Employee's estate or other legal representatives shall have
such period of time to exercise the stock options as is provided in the Stock
Option Plan and agreements with Employee pursuant thereto. For a period of
eighteen (18) months following the Date of Termination, and subject to the
continued copayment of premium amounts by the Employee's spouse and dependents,
the Employee's spouse and dependents shall continue to participate in the
Company's health insurance plan upon the same terms and conditions in effect on
the Date of Termination, PROVIDED, HOWEVER, that the continuation of health
benefits under this Subparagraph shall reduce and count against the rights of
the Employee's spouse and dependents under the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended ("COBRA"). In addition to the foregoing,
any payments to which Employee's spouse, beneficiaries, or estate may be
entitled under any employee benefit plan shall also be paid in accordance with
the terms of such plan or arrangement. Such payments, in the aggregate, shall
fully discharge the Company's obligations hereunder.

          (c)   DISABILITY. If, as a result of Employee's incapacity due to
physical or mental illness, Employee shall have been absent from his duties
hereunder on a full-time basis for one hundred eighty (180) calendar days in the
aggregate in any twelve (12) month period, the Company may terminate Employee's
employment hereunder. During any period that Employee fails to perform his
duties hereunder as a result of incapacity due to physical or mental illness,
Employee shall continue to receive his accrued and unpaid Base Salary and
accrued and unpaid target bonus, prorated for the number of days actually
employed in the then current calendar year, until Employee's employment is
terminated due to disability in accordance with this Subparagraph (c) or until
Employee terminates his employment in accordance with Subparagraph (e)(ii) or
(f), if earlier. All unvested stock options and stock-based grants shall
immediately vest and become exercisable or nonforfeitable, and Employee shall
have such period of time to exercise the stock options as is provided in the
Stock Option Plan and agreements with Employee pursuant thereto. For a period of
eighteen (18) months following the Date of Termination and subject to the
Employee's continued copayment of premium amounts, the Employee, Employee's
spouse and dependents shall continue to participate in the Company's

                                        5


health insurance plan upon the same terms and conditions in effect on the Date
of Termination, PROVIDED, HOWEVER, that the continuation of health benefits
under this Subparagraph shall reduce and count against Employee's rights under
COBRA. In addition to the foregoing, any payments to which Employee may be
entitled under any employee benefit plan shall also be paid in accordance with
the terms of such plan or arrangement. Such payments, in the aggregate, shall
fully discharge the Company's obligations hereunder.

          (d)   TERMINATION BY THE COMPANY FOR CAUSE.

                (i)      The Company may terminate Employee's employment
hereunder for Cause. "CAUSE" shall mean: (A) gross negligence or willful
misconduct by Employee in connection with the performance of his material duties
hereunder; (B) a breach by Employee of any of his material duties hereunder (for
reasons other than physical or mental illness) and the failure of Employee to
cure such breach within thirty (30) days after written notice thereof by the
Company; (C) conduct by Employee against the material best interests of the
Company or a material act of common law fraud against the Company or its
affiliates or employees; or (D) indictment of Employee of a felony and such
indictment has a material adverse affect on the interests or reputation of the
Company.

                (ii)     If Employee's employment is terminated by the Company
for Cause, then the Company shall, through the Date of Termination, pay Employee
his accrued and unpaid Base Salary. Thereafter, the Company shall have no
further obligations to Employee except as otherwise provided hereunder; PROVIDED
that any such termination shall not adversely affect or alter Employee's rights
under any employee benefit plan of the Company in which Employee, at the Date of
Termination, has a vested interest, unless otherwise provided in such employee
benefit plan or any agreement or other instrument attendant thereto.
Notwithstanding the foregoing and in addition to whatever other rights or
remedies the Company may have at law or in equity, all stock options and other
stock-based grants held by Employee, whether vested or unvested as of the Date
of Termination, shall immediately expire on the Date of Termination if
Employee's employment is terminated by the Company for Cause.

          (e)   TERMINATION BY THE COMPANY WITHOUT CAUSE OR BY EMPLOYEE FOR GOOD
REASON.

                (i)      The Company may terminate Employee's employment
hereunder without Cause if such termination is approved by the Chief Executive
Officer or Chairman of the Company. Any termination by the Company of Employee's
employment hereunder which does not (A) constitute a termination for Cause under
Subparagraph (d)(i), (B) result from the death or disability of the Employee
under Subparagraph (b) or (c), or (C) result from the expiration of the Term,
shall be deemed a termination without Cause.

                (ii)     Employee may terminate his employment hereunder for
Good Reason. "GOOD REASON" shall mean: (A) a substantial adverse change, not
consented to by Employee, in the nature or scope of Employee's responsibilities,
authorities, powers, functions, or duties under this Agreement; (B) a breach by
the Company of any of its material obligations hereunder and the failure of the
Company to cure such breach within thirty (30) days after written notice thereof
by Employee; or (C) the involuntary relocation of the Company's offices

                                        6


at which Employee is principally employed to a location more than fifty (50)
miles from such offices, or the requirement by the Company that Employee be
based anywhere other than the Company's offices at such location on an extended
basis, except for required travel on the Company's business to an extent
substantially consistent with Employee's business travel obligations.

                (iii)    If Employee's employment is terminated by the Company
without Cause or if Employee terminates his employment for Good Reason in
accordance with this Subparagraph (e), then the Company shall, through the Date
of Termination, pay Employee his accrued and unpaid Base Salary and his accrued
and unpaid target bonus prorated for the number of days actually employed in the
then current calendar year. In addition, subject to signing by Employee of a
general release of claims in a form and manner satisfactory to the Company, the
Employee shall be entitled to the following:

                         (A)  Salary continuation in an amount (the "SEVERANCE
AMOUNT") equal to the sum of (x) his annual Base Salary under Subparagraph 3(a)
and (y) the amount of his cash bonus, if any, received in respect of the
immediately preceding year under Subparagraph 3(b). The Severance Amount shall
be paid in equal monthly installments over a twelve (12) month period;

                         (B)  All stock options and other stock-based awards,
granted to Employee after the Effective Date, in which Employee would have
vested if he had remained employed for a period of twelve (12) months commencing
on the Date of Termination, shall vest and become exercisable or nonforfeitable
as of the Date of Termination;

                         (C)  Subject to the Employee's continued copayment of
premium amounts, continued participation for twelve (12) months in the Company's
health insurance plan upon the same terms and conditions in effect on the Date
of Termination, PROVIDED, HOWEVER, that the continuation of health benefits
under this Subparagraph shall reduce and count against Employee's rights under
COBRA; and

                         (D)  Subject to (B) above, all rights and benefits
granted or in effect with respect to Employee under the Stock Option Plan and
agreements with Employee pursuant thereto.

          (f)   VOLUNTARY TERMINATION BY EMPLOYEE. Employee may terminate his
employment hereunder for any reason, including, but not limited to, Good Reason
in accordance with Subparagraph (e)(ii). If Employee's employment is terminated
by Employee other than for Good Reason, then the Company shall, through the Date
of Termination, pay Employee his accrued and unpaid Base Salary. Thereafter, the
Company shall have no further obligations to Employee except as otherwise
expressly provided hereunder; PROVIDED any such termination shall not adversely
affect or alter Employee's rights under any employee benefit plan of the Company
in which Employee, at the Date of Termination, has a vested interest, unless
otherwise provided in such employee benefit plan or any agreement or other
instrument attendant thereto. The vesting and exercise of any stock options and
the forfeitability of any stock-based grants held by Employee shall be governed
by the terms of the Stock Option Plan and the related agreements between
Employee and the Company

                                        7


          (g)   NO MITIGATION. Without regard to the reason for the termination
of Employee's employment hereunder, Employee shall be under no obligation to
mitigate damages with respect to such termination under any circumstances and in
the event Employee is employed or receives income from any other source, there
shall be no offset against the amounts due from the Company hereunder.

     9.   NONCOMPETITION. Because Employee's services to the Company are special
and because Employee has access to the Company's confidential information,
Employee covenants and agrees that during the Employment Period and until the
end of a one-year period following the termination of Employee's employment with
the Company for any reason, Employee shall not, without the prior written
consent of the Company (which shall be authorized by approval of the Board of
Directors of the Company, including the approval of a majority of the
independent Directors of the Company), directly or indirectly:

          (a)   engage, participate or assist in, either individually or as an
owner, partner, employee, consultant, director, officer, trustee, or agent of
any business that engages or attempts to engage in, directly or indirectly, the
acquisition, development, construction, operation, management, or leasing of any
commercial real estate property in any of the Company's Markets (as hereinafter
defined) at the time of Employee's termination of employment;

          (b)   intentionally interfere with, disrupt or attempt to disrupt the
relationship, contractual or otherwise, between the Company or its affiliates
and any tenant, supplier, contractor, lender, employee, or governmental agency
or authority; or

          (c)   call upon, compete for, solicit, divert, or take away, or
attempt to divert or take away any of the tenants or employees of the Company or
its affiliates, either for himself or for any other business, operation,
corporation, partnership, association, agency, or other person or entity.

     "MARKET" as used herein means an area covering a 25 mile radius around (x)
any property or land owned by the Company, under development by the Company or
with respect to which the Company has an agreement or option to acquire a
property, development or land or (y) any property or development for which the
Company provides third party development or management services; PROVIDED that
for any such property, development or land located in New York City, no such
radial area shall extend beyond New York City.

     This Paragraph 9 shall not be interpreted to prevent Employee from engaging
in Minority Interest Passive Investments or any other activity permitted under
Subparagraph 2(b). This Paragraph 9 shall survive the termination of this
Agreement.

     Notwithstanding anything to the contrary herein, the noncompetition
provision of this Paragraph 9 shall not apply if Employee's employment
terminates after a Change in Control (as defined in the Severance Plan).

     10.  CHANGE IN CONTROL PAYMENTS. Notwithstanding anything to the contrary
in the foregoing, in the event that the Employee's employment terminates after a
Change in Control (as defined in the Severance Plan) under circumstances that
would entitle him to payments and

                                        8


benefits under the Severance Plan, he shall not be entitled to receive any
payments or benefits under this Agreement.

     11.  CONFLICTING AGREEMENTS. Employee hereby represents and warrants that
the execution of this Agreement and the performance of his obligations hereunder
will not breach or be in conflict with any other agreement to which he is a
party or is bound, and that he is not now subject to any covenants against
competition or similar covenants which would affect the performance of his
obligations hereunder.

     12.  NOTICES. All notices, requests, demands, and other communications
under this Agreement shall be in writing and shall be deemed duly given (i) if
delivered by hand and receipted for by the party addressee, on the date of such
receipt or (ii) if mailed by domestic certified or registered mail with postage
prepaid, on the third business day after the date postmarked. Address for notice
for the Company is as shown above, or as subsequently modified by written
notice. Address for notice for the Employee is the address shown on the records
of the Company.

     13.  INTEGRATION. This Agreement constitutes the entire agreement between
the parties with respect to the subject matter hereof and supersedes all prior
agreements between the parties with respect to any related subject matter,
provided, however, that the Severance Plan, as amended from time to time, shall
remain in full force and effect hereafter.

     14.  ASSIGNMENT; SUCCESSORS AND ASSIGNS, ETC. Neither the Company nor the
Employee may make any assignment of this Agreement or any interest herein, by
operation of law or otherwise, without the prior written consent of the other
party; provided that the Company may assign its rights under this Agreement
without the consent of the Employee in the event that the Company shall effect a
reorganization, consolidate with or merge into any other corporation,
partnership, organization or other entity, or transfer all or substantially all
of its properties or assets to any other corporation, partnership, organization
or other entity. This Agreement shall inure to the benefit of and be binding
upon the Company and the Employee, their respective successors, executors,
administrators, heirs and permitted assigns.

     15.  MISCELLANEOUS. Headings herein are for convenience of reference only
and shall not define, limit or interpret the contents hereof.

     16.  AMENDMENT. This Agreement may be amended, modified or supplemented by
the mutual consent of the parties in writing, but no oral amendment,
modification or supplement shall be effective.

     17.  ARBITRATION; OTHER DISPUTES. Any dispute or controversy arising under
or in connection with this Agreement shall be settled exclusively by arbitration
in Boston, Massachusetts, in accordance with the rules of the American
Arbitration Association then in effect. Judgment may be entered in any court
having jurisdiction. Notwithstanding the above, the Company shall be entitled to
seek a restraining order or injunction in any court of competent jurisdiction to
prevent any continuation of any violation of Paragraph 7 or 9 hereof. In the
event that the Company terminates Employee's employment for Cause under
Subparagraph 8(d)(i) and Employee contends that Cause did not exist, then the
Company's only obligation shall be to

                                        9


submit such claim to arbitration and the only issue before the arbitrator will
be whether Employee was in fact terminated for Cause. If the arbitrator
determines that Employee was not terminated for Cause by the Company, then the
only remedies that the arbitrator may award are (i) the Severance Amount
specified in Subparagraph 8(e)(iii)(A), (ii) the costs of arbitration, (iii)
Employee's reasonable attorneys' fees, (iv) the additional vesting of Employee's
stock options and other stock-based awards in accordance with Subparagraph
8(e)(iii)(B), and (v) the continued participation in the Company's health
insurance plan in accordance with Subparagraph 8(e)(iii)(C). If the arbitrator
finds that Employee was terminated for Cause, the arbitrator will be without
authority to award Employee anything, and the parties will each be responsible
for their own attorneys' fees, and they will divide the costs of arbitration
equally. Furthermore, should a dispute occur concerning Employee's mental or
physical capacity as described in Subparagraph 8(c), a doctor selected by
Employee and a doctor selected by the Company shall be entitled to examine
Employee. If the opinion of the Company's doctor and Employee's doctor conflict,
the Company's doctor and Employee's doctor shall together agree upon a third
doctor, whose opinion shall be binding. This Paragraph 17 shall survive the
termination of this Agreement.

     18.  LITIGATION AND REGULATORY COOPERATION. During and after Employee's
employment, Employee shall reasonably cooperate with the Company in the defense
or prosecution of any claims or actions now in existence or which may be brought
in the future against or on behalf of the Company which relate to events or
occurrences that transpired while Employee was employed by the Company; provided
that such cooperation shall not materially and adversely affect Employee or
expose Employee to an increased probability of civil or criminal litigation.
Employee's cooperation in connection with such claims or actions shall include,
without limitation, being available to meet with counsel to prepare for
discovery or trial and to act as a witness on behalf of the Company at mutually
convenient times. During and after Employee's employment, Employee also shall
cooperate fully with the Company in connection with any investigation or review
of any federal, state or local regulatory authority as any such investigation or
review relates to events or occurrences that transpired while Employee was
employed by the Company. The Company shall also provide Employee with
compensation on an hourly basis calculated at his final base compensation rate
for requested litigation and regulatory cooperation that occurs after his
termination of employment, and reimburse Employee for all costs and expenses
incurred in connection with his performance under this Paragraph 18, including,
without limitation, reasonable attorneys' fees and costs.

     19.  SEVERABILITY. If any provision of this Agreement shall to any extent
be held void or unenforceable (as to duration, scope, activity, subject or
otherwise) by a court of competent jurisdiction, such provision shall be deemed
to be modified so as to constitute a provision conforming as nearly as possible
to the original provision while still remaining valid and enforceable. In such
event, the remainder of this Agreement (or the application of such provision to
persons or circumstances other than those in respect of which it is deemed to be
void or unenforceable) shall not be affected thereby. Each other provision of
this Agreement, unless specifically conditioned on the voided aspect of such
provision, shall remain valid and enforceable to the fullest extent permitted by
law; any other provisions of this Agreement that are specifically conditioned on
the voided aspect of such invalid provision shall also be deemed to be modified
so as to constitute a provision conforming as nearly as possible to the original
provision while still remaining valid and enforceable to the fullest extent
permitted by law.

                                       10


     20.  GOVERNING LAW. This Agreement shall be construed and regulated in all
respects under the laws of the State of Delaware.

     21.  COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be taken to be
an original; but such counterparts shall together constitute one and the same
document.

                                       11


     IN WITNESS WHEREOF, this Agreement is entered into as of the date and year
first above written.

                                         BOSTON PROPERTIES, INC.

                                         By: /s/ Edward H. Linde
                                            ------------------------------------
                                             Name:  Edward H. Linde
                                             Title: President and
                                                    Chief Executive Officer


                                         /s/ Raymond A. Ritchey
                                         ---------------------------------------
                                         Raymond A. Ritchey

                                       12



                                                                   EXHIBIT 10.16

                              AMENDED AND RESTATED
                              EMPLOYMENT AGREEMENT

     THIS AGREEMENT (the "AGREEMENT") is made as of the 29th day of November,
2002 (the "EFFECTIVE DATE"), by and between Robert E. Selsam (the "EMPLOYEE")
and Boston Properties, Inc., a Delaware corporation, with its principal
executive office located at 111 Huntington Avenue, Suite 300, Boston,
Massachusetts 02199-7610 (together with its subsidiaries, the "COMPANY").

                                WITNESSETH THAT:

     WHEREAS, the Company and the Employee have entered into that certain
Employment Agreement, dated as of June 23, 1997, which agreement the parties
desire to be amended, restated and superseded in its entirety by this Agreement;

     WHEREAS, the Company has determined that it is in its best interest to
continue the employment of the Employee on the terms hereinafter set forth;

     WHEREAS, the Employee wishes to be so employed pursuant to the terms
hereinafter set forth;

     WHEREAS, the Company has adopted that certain Senior Executive Severance
Plan, effective as of July 30, 1998 (the "SEVERANCE PLAN"), as may be amended
from time to time, and which the parties desire to remain in full force and
effect after the date hereof;

     NOW, THEREFORE, in consideration of the mutual covenants and premises set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Employee
hereby agree as follows:

     1.   TERM. Subject to the provisions of Paragraph 8, the term of employment
pursuant to this Agreement (the "TERM") shall be two (2) years from the
Effective Date and shall be renewed automatically for periods of one (1) year
commencing at each anniversary of the Effective Date, unless written notice is
given by either party to the other not less than ninety (90) days prior to any
such anniversary of such party's election not to extend the Term.

     2.   EMPLOYMENT; DUTIES; LOCATION.

          (a)   Employee shall initially serve as an officer of the Company with
the title Senior Vice President, Regional Manager. Employee's duties and
authority shall be commensurate with his title and position with the Company.
The Employee shall report directly to the Executive Vice President for
Operations and shall serve the Company in such other capacity or capacities as
the Employee may be requested to serve by the Board of Directors of the Company
(the "BOARD OF DIRECTORS"). In such capacity or capacities, the Employee shall
perform such services and duties in connection with the business, affairs and
operations of the Company as may be assigned or delegated to the Employee from
time to time by or under the authority of the Board of Directors. The Employee
shall be principally located at the Company's New York office.



          (b)   Employee agrees to his employment as described in this Paragraph
2 and agrees to devote substantially all of his working time and efforts to the
performance of his duties hereunder, except as otherwise approved by the Board
of Directors. Notwithstanding the foregoing, nothing herein shall be interpreted
to preclude Employee from (i) engaging in Minority Interest Passive Investments
(as defined below), including Minority Interest Passive Investments in, or
relating to the ownership, development, operation, management, or leasing of,
commercial real estate properties or (ii) participating as an officer or
director of, or advisor to, any charitable or other tax exempt organization;
PROVIDED that such activities and related duties and pursuits do not restrict
Employee's ability to fulfill his obligations as an officer and employee of the
Company as set forth herein.

     Engaging in a "MINORITY INTEREST PASSIVE INVESTMENT" means acquiring,
holding, and exercising the voting rights associated with an investment made
through (i) the purchase of securities (including partnership interests) that
represent a non-controlling, minority interest in an entity or (ii) the lending
of money, in either case with the purpose or intent of obtaining a return on
such investment but without management by Employee of the property or business
to which such investment directly or indirectly relates and without any business
or strategic consultation by Employee with such entity.

     3.   COMPENSATION.

          (a)   BASE SALARY. The Company shall pay Employee an annual salary of
Two Hundred Seventy-Five Thousand Dollars ($275,000) (the "BASE SALARY"),
payable in accordance with the Company's normal business practices for senior
executives (including tax withholding), but in no event less frequently than
monthly. Employee's Base Salary shall be reviewed at least annually by the Board
of Directors or the Compensation Committee of the Board of Directors (the
"COMPENSATION COMMITTEE") and may be increased but not decreased in its
discretion.

          (b)   BONUS. On each annual compensation determination date
established by the Company during the Term, the Company shall review the
performance of the Company and of Employee during the prior year, and the
Company may provide Employee with additional compensation as a bonus if the
Board of Directors, or the Compensation Committee, in its discretion, determines
that Employee's contribution to the Company warrants such additional payment and
the Company's anticipated financial performance for the present period permits
such payment.

     4.   BENEFITS.

          (a)   MEDICAL/DENTAL INSURANCE. Employee shall be entitled to
participate in any and all employee benefit plans, including all medical and
dental insurance plans as in effect from time to time for senior executives of
the Company. Such participation shall be subject to (i) the terms of the
applicable plan documents, (ii) generally applicable policies of the Company,
and (iii) the discretion of the Board of Directors, the Compensation Committee
or any administrative or other committee provided for in, or contemplated by,
such plan. Nothing contained in this Agreement shall be construed to create any
obligation on the part of the Company to establish any such plan or to maintain
the effectiveness of any such plan which may be in effect from time to time.

                                        2


          (b)   LIFE INSURANCE/DISABILITY INSURANCE. The Company shall provide
Employee with such life and/or disability insurance as the Company may from time
to time make available to senior executives of the Company.

          (c)   EXPENSES. The Company shall promptly reimburse Employee for all
reasonable business expenses incurred by Employee in accordance with the
practices of the Company for senior executives of the Company, as in effect from
time to time.

          (d)   VACATION. Employee shall receive paid vacation annually in
accordance with terms determined for such Employee by the Company, but in no
event shall Employee receive less than four weeks of paid vacation per year.

          (e)   STOCK OPTIONS; RESTRICTED STOCK. Employee shall be entitled to
grants of stock options and restricted stock awards in an amount to be
determined by the Compensation Committee in its discretion under the Boston
Properties, Inc. 1997 Stock Option and Incentive Plan or any other stock option
plan adopted by the Company from time to time (the "STOCK OPTION PLAN").

          (f)   DEFERRED COMPENSATION. Employee shall be entitled to participate
in any deferred compensation plan or arrangement that the Company may have in
place for its senior executives and/or officers.

          (g)  OTHER BENEFITS. The Company shall provide to Employee such other
benefits, including the right to participate in such retirement or pension
plans, as are made generally available to senior executives of the Company from
time to time. Such participation shall be subject to (i) the terms of the
applicable plan documents, (ii) generally applicable policies of the Company,
and (iii) the discretion of the Board of Directors, the Compensation Committee,
or any administrative or other committee provided for in, or contemplated by,
such plan.

          (h)   TAXATION OF PAYMENTS AND BENEFITS. The Company shall undertake
to make deductions, withholdings and tax reports with respect to payments and
benefits under this Agreement to the extent that it reasonably and in good faith
believes that it is required to make such deductions, withholdings and tax
reports. Payments under this Agreement shall be in amounts net of any such
deductions or withholdings. Nothing in this Agreement shall be construed to
require the Company to make any payments to compensate the Employee for any
adverse tax effect associated with any payments or benefits or for any deduction
or withholding from any payment or benefit.

     5.   INDEMNIFICATION. To the full extent permitted by law and subject to
the Company's Certificate of Incorporation and Bylaws, the Company shall
indemnify Employee with respect to any actions commenced against Employee in his
capacity as a director or officer or former director or officer of the Company,
or any affiliate thereof for which he may serve in such capacity, and the
Company shall advance on a timely basis any expenses incurred in defending such
actions. The obligation to indemnify hereunder shall survive the termination of
this Agreement. The Company agrees to use its best efforts to secure and
maintain directors' and officers' liability insurance with respect to Employee.

                                        3


     6.   COMPANY AUTHORITY/POLICIES. Employee agrees to observe and comply with
the rules and regulations of the Company as adopted by its Board of Directors
respecting the performance of his duties and to carry out and perform orders,
directions and policies communicated to him from time to time by the Board of
Directors.

     7.   RECORDS/NONDISCLOSURE/COMPANY POLICIES.

          (a)   GENERAL. All records, financial statements and similar documents
obtained, reviewed or compiled by Employee in the course of the performance by
him of services for the Company, whether or not confidential information or
trade secrets, shall be the exclusive property of the Company. Employee shall
have no rights in such documents upon any termination of this Agreement.

          (b)   CONFIDENTIAL INFORMATION. Employee will not disclose to any
person or entity (except as required by applicable law, the rules of the New
York Stock Exchange, or otherwise in connection with the performance of his
duties and responsibilities hereunder), or use for his own benefit or gain, any
confidential information of the Company obtained by him incident to his
employment with the Company. Employee shall take all reasonable steps to
safeguard any confidential information and to protect such confidential
information against disclosure, misuse, loss, or theft. The term "CONFIDENTIAL
INFORMATION" includes, without limitation, financial information, business
plans, prospects, and opportunities which have been discussed or considered by
the management of the Company, but does not include any information which has
become part of the public domain by means other than Employee's non-observance
of his obligations hereunder.

     This Paragraph 7 shall survive the termination of this Agreement.

     8.   TERMINATION/SEVERANCE.

          (a)   GENERAL.

                (i)      AT WILL EMPLOYMENT. Employee's employment hereunder is
"at will" and, therefore, may be terminated at any time, with or without cause,
at the option of the Company, subject only to the severance obligations under
this Paragraph 8.

                (ii)     NOTICE OF TERMINATION. Except for termination as a
result of Employee's death as specified in Subparagraph 8(b), any termination of
Employee's employment by the Company or any such termination by Employee shall
be communicated by written Notice of Termination to the other party hereto. For
purposes of this Agreement, a "NOTICE OF TERMINATION" shall mean a notice which
shall indicate the specific termination provision hereunder relied upon by the
terminating party.

                (iii)    DATE OF TERMINATION. "DATE OF TERMINATION" shall mean:
(A) if Employee's employment is terminated by his death, the date of his death;
(B) if Employee's employment is terminated on account of disability under
Subparagraph 8(c), the date on which Notice of Termination is given; (C) if
Employee's employment is terminated by the Company for Cause under Subparagraph
8(d), the date on which a Notice of Termination is given; (D) if Employee's
employment is terminated by the Company without Cause under Subparagraph

                                        4


8(e)(i), thirty (30) days after the date on which a Notice of Termination is
given; and (E) if Employee's employment is terminated by Employee under
Subparagraph 8(e)(ii) or 8(f), thirty (30) days after the date on which a Notice
of Termination is given.

          (b)   DEATH. Employee's employment hereunder shall terminate upon his
death. If Employee's employment terminates by reason of his death, the Company
shall, within ninety (90) days of death, pay in a lump sum amount to such person
as Employee shall designate in a notice filed with the Company or, if no such
person is designated, to Employee's estate, Employee's accrued and unpaid Base
Salary to his date of death, plus his accrued and unpaid target bonus, prorated
for the number of days actually employed in the then current calendar year. All
unvested stock options and stock-based grants shall immediately vest in
Employee's estate or other legal representatives and become exercisable or
nonforfeitable, and Employee's estate or other legal representatives shall have
such period of time to exercise the stock options as is provided in the Stock
Option Plan and agreements with Employee pursuant thereto. For a period of
eighteen (18) months following the Date of Termination, and subject to the
continued copayment of premium amounts by the Employee's spouse and dependents,
the Employee's spouse and dependents shall continue to participate in the
Company's health insurance plan upon the same terms and conditions in effect on
the Date of Termination, PROVIDED, HOWEVER, that the continuation of health
benefits under this Subparagraph shall reduce and count against the rights of
the Employee's spouse and dependents under the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended ("COBRA"). In addition to the foregoing,
any payments to which Employee's spouse, beneficiaries, or estate may be
entitled under any employee benefit plan shall also be paid in accordance with
the terms of such plan or arrangement. Such payments, in the aggregate, shall
fully discharge the Company's obligations hereunder.

          (c)   DISABILITY. If, as a result of Employee's incapacity due to
physical or mental illness, Employee shall have been absent from his duties
hereunder on a full-time basis for one hundred eighty (180) calendar days in the
aggregate in any twelve (12) month period, the Company may terminate Employee's
employment hereunder. During any period that Employee fails to perform his
duties hereunder as a result of incapacity due to physical or mental illness,
Employee shall continue to receive his accrued and unpaid Base Salary and
accrued and unpaid target bonus, prorated for the number of days actually
employed in the then current calendar year, until Employee's employment is
terminated due to disability in accordance with this Subparagraph (c) or until
Employee terminates his employment in accordance with Subparagraph (e)(ii) or
(f), if earlier. All unvested stock options and stock-based grants shall
immediately vest and become exercisable or nonforfeitable, and Employee shall
have such period of time to exercise the stock options as is provided in the
Stock Option Plan and agreements with Employee pursuant thereto. For a period of
eighteen (18) months following the Date of Termination and subject to the
Employee's continued copayment of premium amounts, the Employee, Employee's
spouse and dependents shall continue to participate in the Company's health
insurance plan upon the same terms and conditions in effect on the Date of
Termination, PROVIDED, HOWEVER, that the continuation of health benefits under
this Subparagraph shall reduce and count against Employee's rights under COBRA.
In addition to the foregoing, any payments to which Employee may be entitled
under any employee benefit plan shall also be paid in accordance with the terms
of such plan or arrangement. Such payments, in the aggregate, shall fully
discharge the Company's obligations hereunder.

                                        5


          (d)   TERMINATION BY THE COMPANY FOR CAUSE.

                (i)      The Company may terminate Employee's employment
hereunder for Cause. "CAUSE" shall mean: (A) gross negligence or willful
misconduct by Employee in connection with the performance of his material duties
hereunder; (B) a breach by Employee of any of his material duties hereunder (for
reasons other than physical or mental illness) and the failure of Employee to
cure such breach within thirty (30) days after written notice thereof by the
Company; (C) conduct by Employee against the material best interests of the
Company or a material act of common law fraud against the Company or its
affiliates or employees; or (D) indictment of Employee of a felony and such
indictment has a material adverse affect on the interests or reputation of the
Company.

                (ii)     If Employee's employment is terminated by the Company
for Cause, then the Company shall, through the Date of Termination, pay Employee
his accrued and unpaid Base Salary. Thereafter, the Company shall have no
further obligations to Employee except as otherwise provided hereunder; PROVIDED
that any such termination shall not adversely affect or alter Employee's rights
under any employee benefit plan of the Company in which Employee, at the Date of
Termination, has a vested interest, unless otherwise provided in such employee
benefit plan or any agreement or other instrument attendant thereto.
Notwithstanding the foregoing and in addition to whatever other rights or
remedies the Company may have at law or in equity, all stock options and other
stock-based grants held by Employee, whether vested or unvested as of the Date
of Termination, shall immediately expire on the Date of Termination if
Employee's employment is terminated by the Company for Cause.

          (e)   TERMINATION BY THE COMPANY WITHOUT CAUSE OR BY EMPLOYEE FOR GOOD
REASON.

                (i)      The Company may terminate Employee's employment
hereunder without Cause if such termination is approved by the Chief Executive
Officer or Chairman of the Company. Any termination by the Company of Employee's
employment hereunder which does not (A) constitute a termination for Cause under
Subparagraph (d)(i), (B) result from the death or disability of the Employee
under Subparagraph (b) or (c), or (C) result from the expiration of the Term,
shall be deemed a termination without Cause.

                (ii)     Employee may terminate his employment hereunder for
Good Reason. "GOOD REASON" shall mean: (A) a substantial adverse change, not
consented to by Employee, in the nature or scope of Employee's responsibilities,
authorities, powers, functions, or duties under this Agreement; (B) a breach by
the Company of any of its material obligations hereunder and the failure of the
Company to cure such breach within thirty (30) days after written notice thereof
by Employee; or (C) the involuntary relocation of the Company's offices at which
Employee is principally employed to a location more than fifty (50) miles from
such offices, or the requirement by the Company that Employee be based anywhere
other than the Company's offices at such location on an extended basis, except
for required travel on the Company's business to an extent substantially
consistent with Employee's business travel obligations.

                                        6


                (iii)    If Employee's employment is terminated by the Company
without Cause or if Employee terminates his employment for Good Reason in
accordance with this Subparagraph (e), then the Company shall, through the Date
of Termination, pay Employee his accrued and unpaid Base Salary and his accrued
and unpaid target bonus prorated for the number of days actually employed in the
then current calendar year. In addition, subject to signing by Employee of a
general release of claims in a form and manner satisfactory to the Company, the
Employee shall be entitled to the following:

                         (A)  Salary continuation in an amount (the "SEVERANCE
AMOUNT") equal to the sum of (x) his annual Base Salary under Subparagraph 3(a)
and (y) the amount of his cash bonus, if any, received in respect of the
immediately preceding year under Subparagraph 3(b). The Severance Amount shall
be paid in equal monthly installments over a twelve (12) month period;

                         (B)  All stock options and other stock-based awards,
granted to Employee after the Effective Date, in which Employee would have
vested if he had remained employed for a period of twelve (12) months commencing
on the Date of Termination, shall vest and become exercisable or nonforfeitable
as of the Date of Termination;

                         (C)  Subject to the Employee's continued copayment of
premium amounts, continued participation for twelve (12) months in the Company's
health insurance plan upon the same terms and conditions in effect on the Date
of Termination, PROVIDED, HOWEVER, that the continuation of health benefits
under this Subparagraph shall reduce and count against Employee's rights under
COBRA; and

                         (D)  Subject to (B) above, all rights and benefits
granted or in effect with respect to Employee under the Stock Option Plan and
agreements with Employee pursuant thereto.

     (f)  VOLUNTARY TERMINATION BY EMPLOYEE. Employee may terminate his
employment hereunder for any reason, including, but not limited to, Good Reason
in accordance with Subparagraph (e)(ii). If Employee's employment is terminated
by Employee other than for Good Reason, then the Company shall, through the Date
of Termination, pay Employee his accrued and unpaid Base Salary. Thereafter, the
Company shall have no further obligations to Employee except as otherwise
expressly provided hereunder; PROVIDED any such termination shall not adversely
affect or alter Employee's rights under any employee benefit plan of the Company
in which Employee, at the Date of Termination, has a vested interest, unless
otherwise provided in such employee benefit plan or any agreement or other
instrument attendant thereto. The vesting and exercise of any stock options and
the forfeitability of any stock-based grants held by Employee shall be governed
by the terms of the Stock Option Plan and the related agreements between
Employee and the Company

     (g)  NO MITIGATION. Without regard to the reason for the termination of
Employee's employment hereunder, Employee shall be under no obligation to
mitigate damages with respect to such termination under any circumstances and in
the event Employee is employed or receives income from any other source, there
shall be no offset against the amounts due from the Company hereunder.

                                        7


     9.   NONCOMPETITION. Because Employee's services to the Company are special
and because Employee has access to the Company's confidential information,
Employee covenants and agrees that during the Employment Period and until the
end of a one-year period following the termination of Employee's employment with
the Company for any reason, Employee shall not, without the prior written
consent of the Company (which shall be authorized by approval of the Board of
Directors of the Company, including the approval of a majority of the
independent Directors of the Company), directly or indirectly:

          (a)   engage, participate or assist in, either individually or as an
owner, partner, employee, consultant, director, officer, trustee, or agent of
any business that engages or attempts to engage in, directly or indirectly, the
acquisition, development, construction, operation, management, or leasing of any
commercial real estate property in any of the Company's Markets (as hereinafter
defined) at the time of Employee's termination of employment;

          (b)   intentionally interfere with, disrupt or attempt to disrupt the
relationship, contractual or otherwise, between the Company or its affiliates
and any tenant, supplier, contractor, lender, employee, or governmental agency
or authority; or

          (c)   call upon, compete for, solicit, divert, or take away, or
attempt to divert or take away any of the tenants or employees of the Company or
its affiliates, either for himself or for any other business, operation,
corporation, partnership, association, agency, or other person or entity.

     "MARKET" as used herein means an area covering a 25 mile radius around (x)
any property or land owned by the Company, under development by the Company or
with respect to which the Company has an agreement or option to acquire a
property, development or land or (y) any property or development for which the
Company provides third party development or management services; PROVIDED that
for any such property, development or land located in New York City, no such
radial area shall extend beyond New York City.

     This Paragraph 9 shall not be interpreted to prevent Employee from engaging
in Minority Interest Passive Investments or any other activity permitted under
Subparagraph 2(b). This Paragraph 9 shall survive the termination of this
Agreement.

     Notwithstanding anything to the contrary herein, the noncompetition
provision of this Paragraph 9 shall not apply if Employee's employment
terminates after a Change in Control (as defined in the Severance Plan).

     10.  CHANGE IN CONTROL PAYMENTS. Notwithstanding anything to the contrary
in the foregoing, in the event that the Employee's employment terminates after a
Change in Control (as defined in the Severance Plan) under circumstances that
would entitle him to payments and benefits under the Severance Plan, he shall
not be entitled to receive any payments or benefits under this Agreement.

     11.  CONFLICTING AGREEMENTS. Employee hereby represents and warrants that
the execution of this Agreement and the performance of his obligations hereunder
will not breach or be in conflict with any other agreement to which he is a
party or is bound, and that he is not now

                                        8


subject to any covenants against competition or similar covenants which would
affect the performance of his obligations hereunder.

     12.  NOTICES. All notices, requests, demands, and other communications
under this Agreement shall be in writing and shall be deemed duly given (i) if
delivered by hand and receipted for by the party addressee, on the date of such
receipt or (ii) if mailed by domestic certified or registered mail with postage
prepaid, on the third business day after the date postmarked. Address for notice
for the Company is as shown above, or as subsequently modified by written
notice. Address for notice for the Employee is the address shown on the records
of the Company.

     13.  INTEGRATION. This Agreement constitutes the entire agreement between
the parties with respect to the subject matter hereof and supersedes all prior
agreements between the parties with respect to any related subject matter,
provided, however, that the Severance Plan, as amended from time to time, shall
remain in full force and effect hereafter.

     14.  ASSIGNMENT; SUCCESSORS AND ASSIGNS, ETC. Neither the Company nor the
Employee may make any assignment of this Agreement or any interest herein, by
operation of law or otherwise, without the prior written consent of the other
party; provided that the Company may assign its rights under this Agreement
without the consent of the Employee in the event that the Company shall effect a
reorganization, consolidate with or merge into any other corporation,
partnership, organization or other entity, or transfer all or substantially all
of its properties or assets to any other corporation, partnership, organization
or other entity. This Agreement shall inure to the benefit of and be binding
upon the Company and the Employee, their respective successors, executors,
administrators, heirs and permitted assigns.

     15.  MISCELLANEOUS. Headings herein are for convenience of reference only
and shall not define, limit or interpret the contents hereof.

     16.  AMENDMENT. This Agreement may be amended, modified or supplemented by
the mutual consent of the parties in writing, but no oral amendment,
modification or supplement shall be effective.

     17.  ARBITRATION; OTHER DISPUTES. Any dispute or controversy arising under
or in connection with this Agreement shall be settled exclusively by arbitration
in Boston, Massachusetts, in accordance with the rules of the American
Arbitration Association then in effect. Judgment may be entered in any court
having jurisdiction. Notwithstanding the above, the Company shall be entitled to
seek a restraining order or injunction in any court of competent jurisdiction to
prevent any continuation of any violation of Paragraph 7 or 9 hereof. In the
event that the Company terminates Employee's employment for Cause under
Subparagraph 8(d)(i) and Employee contends that Cause did not exist, then the
Company's only obligation shall be to submit such claim to arbitration and the
only issue before the arbitrator will be whether Employee was in fact terminated
for Cause. If the arbitrator determines that Employee was not terminated for
Cause by the Company, then the only remedies that the arbitrator may award are
(i) the Severance Amount specified in Subparagraph 8(e)(iii)(A), (ii) the costs
of arbitration, (iii) Employee's reasonable attorneys' fees, (iv) the additional
vesting of Employee's stock options and other stock-based awards in accordance
with Subparagraph 8(e)(iii)(B), and (v) the

                                        9


continued participation in the Company's health insurance plan in accordance
with Subparagraph 8(e)(iii)(C). If the arbitrator finds that Employee was
terminated for Cause, the arbitrator will be without authority to award Employee
anything, and the parties will each be responsible for their own attorneys'
fees, and they will divide the costs of arbitration equally. Furthermore, should
a dispute occur concerning Employee's mental or physical capacity as described
in Subparagraph 8(c), a doctor selected by Employee and a doctor selected by the
Company shall be entitled to examine Employee. If the opinion of the Company's
doctor and Employee's doctor conflict, the Company's doctor and Employee's
doctor shall together agree upon a third doctor, whose opinion shall be binding.
This Paragraph 17 shall survive the termination of this Agreement.

     18.  LITIGATION AND REGULATORY COOPERATION. During and after Employee's
employment, Employee shall reasonably cooperate with the Company in the defense
or prosecution of any claims or actions now in existence or which may be brought
in the future against or on behalf of the Company which relate to events or
occurrences that transpired while Employee was employed by the Company; provided
that such cooperation shall not materially and adversely affect Employee or
expose Employee to an increased probability of civil or criminal litigation.
Employee's cooperation in connection with such claims or actions shall include,
without limitation, being available to meet with counsel to prepare for
discovery or trial and to act as a witness on behalf of the Company at mutually
convenient times. During and after Employee's employment, Employee also shall
cooperate fully with the Company in connection with any investigation or review
of any federal, state or local regulatory authority as any such investigation or
review relates to events or occurrences that transpired while Employee was
employed by the Company. The Company shall also provide Employee with
compensation on an hourly basis calculated at his final base compensation rate
for requested litigation and regulatory cooperation that occurs after his
termination of employment, and reimburse Employee for all costs and expenses
incurred in connection with his performance under this Paragraph 18, including,
without limitation, reasonable attorneys' fees and costs.

     19.  SEVERABILITY. If any provision of this Agreement shall to any extent
be held void or unenforceable (as to duration, scope, activity, subject or
otherwise) by a court of competent jurisdiction, such provision shall be deemed
to be modified so as to constitute a provision conforming as nearly as possible
to the original provision while still remaining valid and enforceable. In such
event, the remainder of this Agreement (or the application of such provision to
persons or circumstances other than those in respect of which it is deemed to be
void or unenforceable) shall not be affected thereby. Each other provision of
this Agreement, unless specifically conditioned on the voided aspect of such
provision, shall remain valid and enforceable to the fullest extent permitted by
law; any other provisions of this Agreement that are specifically conditioned on
the voided aspect of such invalid provision shall also be deemed to be modified
so as to constitute a provision conforming as nearly as possible to the original
provision while still remaining valid and enforceable to the fullest extent
permitted by law.

     20.  GOVERNING LAW. This Agreement shall be construed and regulated in all
respects under the laws of the State of Delaware.

     21.  COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be taken to be
an original; but such counterparts shall together constitute one and the same
document.

                                       10


     IN WITNESS WHEREOF, this Agreement is entered into as of the date and year
first above written.

                                         BOSTON PROPERTIES, INC.

                                         By: /s/ Edward H. Linde
                                            ------------------------------------
                                             Name:  Edward H. Linde
                                             Title: President and
                                                    Chief Executive Officer


                                         /s/ Robert E. Selsam
                                         ---------------------------------------
                                         Robert E. Selsam

                                       11



                                                                   EXHIBIT 10.17

                             BOSTON PROPERTIES, INC.

                      SENIOR EXECUTIVE SEVERANCE AGREEMENT

     AGREEMENT made as of this 30th day of July, 1998 by and among Boston
Properties, Inc., a Delaware corporation with its principal place of business in
Boston, Massachusetts (the "Company"), Boston Properties Limited Partnership, a
Delaware limited partnership with its principal place of business in Boston,
Massachusetts ("BPLP") (the Company and BPLP shall be hereinafter collectively
referred to as the "Employers") and Mortimer B. Zuckerman of New York, New York
(the "Executive"), an individual presently employed as the Chairman of the Board
of the Company.

     1.   PURPOSE. The Company considers it essential to the best interests of
its stockholders to foster the continuous employment of key management
personnel. The Board of Directors of the Company (the "Board") recognizes,
however, that, as is the case with many publicly held corporations, the
possibility of a Change in Control (as defined in Section 2 hereof) exists and
that such possibility, and the uncertainty and questions which it may raise
among management, may result in the departure or distraction of management
personnel to the detriment of the Company and its stockholders. Therefore, the
Board has determined that appropriate steps should be taken to reinforce and
encourage the continued attention and dedication of members of the Employers'
management, including the Executive, to their assigned duties without
distraction in the face of potentially disturbing circumstances arising from the
possibility of a Change in Control. Nothing in this Agreement shall be construed
as creating an express or implied contract of employment and, except as
otherwise agreed in writing between the Executive and the Employers, the
Executive shall not have any right to be retained in the employ of the
Employers.

     2.   CHANGE IN CONTROL. For purposes of this Plan, a "Change in Control"
shall mean the occurrence of any one of the following events:

          (a)  any "PERSON," as such term is used in Sections 13(d) and 14(d) of
     the Act (other than the Employers, Mortimer B. Zuckerman, Edward H. Linde,
     any "AFFILIATE" or "ASSOCIATE" (as such terms are defined in Rule 12b-2
     under the Act) of Mortimer B. Zuckerman or Edward H. Linde, or any trustee,
     fiduciary or other person or entity holding securities under any employee
     benefit plan or trust of the Employers), together with all "AFFILIATES" and
     "ASSOCIATES" (as such terms are defined in Rule 12b-2 under the Act) of
     such person, shall become the "BENEFICIAL OWNER" (as such term is defined
     in Rule 13d-3 under the Act), directly or indirectly, of securities of the
     Company representing 25 percent or more of the combined voting power of the
     Company's then outstanding securities having the right to vote in an
     election of the Company's Board of Directors ("Voting Securities") (other
     than as a result of an acquisition of securities directly from the
     Company); provided that for purposes of determining the "BENEFICIAL
     OWNERSHIP" (as such term is defined in Rule 13d-3 under the Act) of any
     "GROUP" of


     which Mortimer B. Zuckerman, Edward H. Linde or any of their affiliates or
     associates is a member (each such entity or individual, a "Related Party"),
     there shall not be attributed to the "BENEFICIAL OWNERSHIP" (as such term
     is defined in Rule 13d-3 under the Act) of such group any shares
     beneficially owned by any Related Party; or

          (b)  persons who, as of the effective date of the Company's initial
     public offering of Stock, constitute the Company's Board of Directors (the
     "Incumbent Directors") cease for any reason, including, without limitation,
     as a result of a tender offer, proxy contest, merger or similar
     transaction, to constitute at least a majority of the Board, provided that
     any person becoming a director of the Company subsequent to such date shall
     be considered an Incumbent Director if such person's election was approved
     by or such person was nominated for election by either (A) a vote of at
     least two-thirds of the Incumbent Directors or (B) a vote of at least a
     majority of the Incumbent Directors who are members of a nominating
     committee comprised, in the majority, of Incumbent Directors; or

          (c)  the stockholders of the Company shall approve (A) any
     consolidation or merger of the Company where the stockholders of the
     Company, immediately prior to the consolidation or merger, would not,
     immediately after the consolidation or merger, "BENEFICIALLY OWN" (as such
     term is defined in Rule 13d-3 under the Act), directly or indirectly,
     shares representing in the aggregate 60 percent or more of the voting
     shares of the corporation issuing cash or securities in the consolidation
     or merger (or of its ultimate parent corporation, if any), (B) any sale,
     lease, exchange or other transfer to an unrelated party (in one transaction
     or a series of transactions contemplated or arranged by any party as a
     single plan) of all or substantially all of the assets of the Company or
     (C) any plan or proposal for the liquidation or dissolution of the Company.

     Notwithstanding the foregoing, a "Change of Control" shall not be deemed to
have occurred for purposes of the foregoing clause (a) solely as the result of
an acquisition of securities by the Company which, by reducing the number of
shares of Voting Securities outstanding, increases the proportionate number of
shares of Voting Securities beneficially owned by any person (as defined in the
foregoing clause (a)) to 25 percent or more of the combined voting power of all
then outstanding Voting Securities; PROVIDED, HOWEVER, that if such person shall
thereafter become the beneficial owner of any additional shares of Voting
Securities (other than pursuant to a stock split, stock dividend, or similar
transaction or as a result of an acquisition of securities directly from the
Company), then a "CHANGE OF CONTROL" shall be deemed to have occurred for
purposes of the foregoing clause (a).

     3.   TERMINATING EVENT. A "Terminating Event" shall mean any of the events
provided in this Section 3 occurring within twenty-four (24) months following a
Change in Control:

          (a)  termination by the Employers of the employment of the Executive
     with the Employers for any reason other than for Cause or the death of the
     Executive. "Cause" shall mean, and shall be limited to, the occurrence of
     any one or more of the following events:

                                        2


               (i)   a willful act of dishonesty by the Executive with respect
          to any matter involving any of the Employers; or

               (ii)  conviction of the Executive of a crime involving moral
          turpitude; or

               (iii) the deliberate or willful failure by the Executive (other
          than by reason of the Executive's physical or mental illness,
          incapacity or disability) to substantially perform the Executive's
          duties with the Employers and the continuation of such failure for a
          period of 30 days after delivery by the Employers to the Executive of
          written notice specifying the scope and nature of such failure and
          their intention to terminate the Executive for Cause.

          A Terminating Event shall not be deemed to have occurred pursuant to
     this Section 3(a) solely as a result of the Executive being an employee of
     any direct or indirect successor to the business or assets of either of the
     Employers, rather than continuing as an employee of the Employers following
     a Change in Control. For purposes of clauses (i) and (iii) of this Section
     3(a), no act, or failure to act, on the Executive's part shall be deemed
     "willful" unless done, or omitted to be done, by the Executive without
     reasonable belief that the Executive's act, or failure to act, was in the
     best interest of the Employers; or

          (b)  termination by the Executive of the Executive's employment with
     the Employers for Good Reason. "Good Reason" shall mean the occurrence of
     any of the following events:

               (i)   a substantial adverse change in the nature or scope of the
          Executive's responsibilities, authorities, title, powers, functions,
          or duties from the responsibilities, authorities, powers, functions,
          or duties exercised by the Executive immediately prior to the Change
          in Control; or

               (ii)  a reduction in the Executive's annual base salary as in
          effect on the date hereof or as the same may be increased from time to
          time except for across-the-board salary reductions similarly affecting
          all or substantially all management employees; or

               (iii) the relocation of the Employers' offices at which the
          Executive is principally employed immediately prior to the date of a
          Change in Control to a location more than thirty (30) miles from such
          offices, or the requirement by the Employers for the Executive to be
          based anywhere other than the Employers' offices at such location,
          except for required travel on the Employers' business to an extent
          substantially consistent with the Executive's business travel
          obligations immediately prior to the Change in Control; or

                                        3


               (iv)  the failure by the Employers to pay to the Executive any
          portion of his compensation or to pay to the Executive any portion of
          an installment of deferred compensation under any deferred
          compensation program of the Employers within fifteen (15) days of the
          date such compensation is due without prior written consent of the
          Executive; or

               (v)   the failure by the Employers to obtain an effective
          agreement from any successor to assume and agree to perform this
          Agreement.

     4.   SPECIAL TERMINATION PAYMENTS. In the event a Terminating Event occurs
within twenty-four (24) months after a Change in Control,

          (a)  the Employers shall pay to the Executive an amount equal to the
     following:

               (i)   $3,000,000 if the Date of Termination (as such term is
          defined in Section 9(b)) is in calendar year 1998; or

               (ii)  $3,300,000 if the Date of Termination is in calendar year
          1999; or

               (iii) $3,630,000 if the Date of Termination is in calendar year
          2000 or later.

     Said amount shall be paid in one lump sum payment no later than thirty-one
     (31) days following the Date of Termination; and

          (b)  the Employers shall continue to provide health, dental and life
     insurance to the Executive, on the same terms and conditions as though the
     Executive had remained an active employee, for thirty-six (36) months after
     the Terminating Event; and

          (c)  the Employers shall provide COBRA benefits to the Executive
     following the end of the period referred to in Section 4(b) above, such
     benefits to be determined as though the Executive's employment had
     terminated at the end of such period; and

          (d)  the Employers shall pay to the Executive all reasonable legal and
     mediation fees and expenses incurred by the Executive in obtaining or
     enforcing any right or benefit provided by this Agreement, except in cases
     involving frivolous or bad faith litigation initiated by the Executive; and

          (e)  the Employers shall provide to the Executive financial
     counseling, tax preparation assistance and outplacement counseling for
     thirty-six (36) months after the Terminating Event.

     Notwithstanding the foregoing, the special termination benefits required by
Section 4(a) shall be offset by any amount paid or payable to the Executive by
the Employers under the terms of any other plan.

                                        4


     5.   ADDITIONAL BENEFITS.

          (a)  Anything in this Agreement to the contrary notwithstanding, in
     the event it shall be determined that any compensation payment or
     distribution by the Employers to or for the benefit of the Executive,
     whether paid or payable or distributed or distributable pursuant to the
     terms of this Agreement or otherwise (the "Severance Payments"), would be
     subject to the excise tax imposed by Section 4999 of the Internal Revenue
     Code of 1986, as amended (the "Code"), or any interest or penalties are
     incurred by the Executive with respect to such excise tax (such excise tax,
     together with any such interest and penalties, are hereinafter collectively
     referred to as the "Excise Tax"), then the Executive shall be entitled to
     receive an additional payment (a "Gross-Up Payment") such that the net
     amount retained by the Executive, after deduction of any Excise Tax on the
     Severance Payments, any Federal, state, and local income tax, employment
     tax and Excise Tax upon the payment provided by this subsection, and any
     interest and/or penalties assessed with respect to such Excise Tax and not
     after the deduction of any other taxes or amounts, shall be equal to the
     Severance Payments. (The Gross-Up Payment is not intended to compensate the
     Executive for any income taxes payable with respect to the Severance
     Payments.)

          (b)  Subject to the provisions of Section 5(c), all determinations
     required to be made under this Section 5, including whether a Gross-Up
     Payment is required and the amount of such Gross-Up Payment, shall be made
     by Coopers & Lybrand, L.L.P. or any other nationally recognized accounting
     firm selected by the Employers (the "Accounting Firm"), which shall provide
     detailed supporting calculations both to the Employers and the Executive
     within 15 business days of the Date of Termination, if applicable, or at
     such earlier time as is reasonably requested by the Employers or the
     Executive. For purposes of determining the amount of the Gross-Up Payment,
     the Executive shall be deemed to pay federal income taxes at the highest
     marginal rate of federal income taxation applicable to individuals for the
     calendar year in which the Gross-Up Payment is to be made, and state and
     local income taxes at the highest marginal rates of individual taxation in
     the state and locality of the Executive's residence on the Date of
     Termination, net of the maximum reduction in federal income taxes which
     could be obtained from deduction of such state and local taxes. The initial
     Gross-Up Payment, if any, as determined pursuant to this Section 5(b),
     shall be paid to the Executive within five days of the receipt of the
     Accounting Firm's determination. If the Accounting Firm determines that no
     Excise Tax is payable by the Executive, the Employers shall furnish the
     Executive with an opinion of counsel that failure to report the Excise Tax
     on the Executive's applicable federal income tax return would not result in
     the imposition of a negligence or similar penalty. Any determination by the
     Accounting Firm shall be binding upon the Employers and the Executive. As a
     result of the uncertainty in the application of Section 4999 of the Code at
     the time of the initial determination by the Accounting Firm hereunder, it
     is possible that Gross-Up Payments which will not have been made by the
     Employers should have been made (an "Underpayment"). In the event that the
     Employers exhaust their remedies pursuant to Section 5(c) and the Executive
     thereafter is required to make a payment of any Excise Tax, the Accounting
     Firm shall

                                        5


     determine the amount of the Underpayment that has occurred, consistent with
     the calculations required to be made hereunder, and any such Underpayment,
     and any interest and penalties imposed on the Underpayment and required to
     be paid by the Executive in connection with the proceedings described in
     Section 5(c), shall be promptly paid by the Employers to or for the benefit
     of the Executive.

          (c)  The Executive shall notify the Employers in writing of any claim
     by the Internal Revenue Service that, if successful, would require the
     payment by the Employers of the Gross-Up Payment. Such notification shall
     be given as soon as practicable but no later than 10 business days after
     the Executive knows of such claim and shall apprise the Employers of the
     nature of such claim and the date on which such claim is requested to be
     paid. The Executive shall not pay such claim prior to the expiration of the
     30-day period following the date on which he gives such notice to the
     Employers (or such shorter period ending on the date that any payment of
     taxes with respect to such claim is due). If the Employers notify the
     Executive in writing prior to the expiration of such period that they
     desire to contest such claim, provided that the Employers have set aside
     adequate reserves to cover the Underpayment and any interest and penalties
     thereon that may accrue, the Executive shall:

               (i)   give the Employers any information reasonably requested by
          the Employers relating to such claim,

               (ii)  take such action in connection with contesting such claim
          as the Employers shall reasonably request in writing from time to
          time, including, without limitation, accepting legal representation
          with respect to such claim by an attorney selected by the Employers,

               (iii) cooperate with the Employers in good faith in order
          effectively to contest such claim, and

               (iv)  permit the Employers to participate in any proceedings
          relating to such claim; provided, however, that the Employers shall
          bear and pay directly all costs and expenses (including additional
          interest and penalties) incurred in connection with such contest and
          shall indemnify and hold the Executive harmless, on an after-tax
          basis, for any Excise Tax or income tax, including interest and
          penalties with respect thereto, imposed as a result of such
          representation and payment of costs and expenses. Without limitation
          on the foregoing provisions of this Section 5(c), the Employers shall
          control all proceedings taken in connection with such contest and, at
          their sole option, may pursue or forego any and all administrative
          appeals, proceedings, hearings and conferences with the taxing
          authority in respect of such claim and may, at their sole option,
          either direct the Executive to pay the tax claimed and sue for a
          refund or contest the claim in any permissible manner, and the
          Executive agrees to prosecute such contest to a determination before
          any administrative tribunal, in a court of initial jurisdiction and in
          one or more appellate courts, as the Employers shall determine;
          provided, however, that if the Employers direct the Executive to

                                        6


          pay such claim and sue for a refund, the Employers shall advance the
          amount of such payment to the Executive on an interest-free basis and
          shall indemnify and hold the Executive harmless, on an after-tax
          basis, from any Excise Tax or income tax, including interest or
          penalties with respect thereto, imposed with respect to such advance
          or with respect to any imputed income with respect to such advance;
          and further provided that any extension of the statute of limitations
          relating to payment of taxes for the taxable year of the Executive
          with respect to which such contested amount is claimed to be due is
          limited solely to such contested amount. Furthermore, the Employers'
          control of the contest shall be limited to issues with respect to
          which a Gross-Up Payment would be payable hereunder and the Executive
          shall be entitled to settle or contest, as the case may be, any other
          issues raised by the Internal Revenue Service or any other taxing
          authority.

          (d)  If, after the receipt by the Executive of an amount advanced by
     the Employers pursuant to Section 5(c), the Executive becomes entitled to
     receive any refund with respect to such claim, the Executive shall (subject
     to the Employers' complying with the requirements of Section 5(c)) promptly
     pay to the Employers the amount of such refund (together with any interest
     paid or credited thereon after taxes applicable thereto). If, after the
     receipt by the Executive of an amount advanced by the Employers pursuant to
     Section 5(c), a determination is made that the Executive shall not be
     entitled to any refund with respect to such claim and the Employers do not
     notify the Executive in writing of their intent to contest such denial of
     refund prior to the expiration of 30 days after such determination, then
     such advance shall be forgiven and shall not be required to be repaid and
     the amount of such advance shall offset, to the extent thereof, the amount
     of Gross-Up Payment required to be paid.

     6.   TERM. This Agreement shall take effect on the date first set forth
above and shall terminate upon the earliest of (a) the termination by the
Employers of the employment of the Executive for Cause; (b) the resignation or
voluntary termination of the Executive for any reason prior to a Change in
Control; or (c) the resignation of the Executive after a Change in Control for
any reason other than the occurrence of any of the events enumerated in Section
3(b)(i)-(v) of this Agreement.

     7.   WITHHOLDING. All payments made by the Employers under this Agreement
shall be net of any tax or other amounts required to be withheld by the
Employers under applicable law.

     8.   NOTICE AND DATE OF TERMINATION; DISPUTES; ETC.

          (a)  NOTICE OF TERMINATION. After a Change in Control and during the
     term of this Agreement, any purported termination of the Executive's
     employment (other than by reason of death) shall be communicated by written
     Notice of Termination from one party hereto to the other party hereto in
     accordance with this Section 8. For purposes of this Agreement, a "Notice
     of Termination" shall mean a notice which shall indicate the specific
     termination provision in this Agreement relied upon and the Date of

                                        7


     Termination. Further, a Notice of Termination for Cause is required to
     include a copy of a resolution duly adopted by the affirmative vote of not
     less than two-thirds (2/3) of the entire membership of the Board at a
     meeting of the Board (after reasonable notice to the Executive and an
     opportunity for the Executive, accompanied by the Executive's counsel, to
     be heard before the Board) finding that, in the good faith opinion of the
     Board, the termination met the criteria for Cause set forth in Section 3(a)
     hereof.

          (b)  DATE OF TERMINATION. "Date of Termination," with respect to any
     purported termination of the Executive's employment after a Change in
     Control and during the term of this Agreement, shall mean the date
     specified in the Notice of Termination. In the case of a termination by the
     Employers other than a termination for Cause (which may be effective
     immediately), the Date of Termination shall not be less than 30 days after
     the Notice of Termination is given. In the case of a termination by the
     Executive, the Date of Termination shall not be less than 15 days from the
     date such Notice of Termination is given. Notwithstanding Section 3(a) of
     this Agreement, in the event that the Executive gives a Notice of
     Termination to the Employers, the Employers may unilaterally accelerate the
     Date of Termination and such acceleration shall not result in a second
     Terminating Event for purposes of Section 3(a) of this Agreement.

          (c)  NO MITIGATION. The Employers agree that, if the Executive's
     employment by the Employers is terminated during the term of this
     Agreement, the Executive is not required to seek other employment or to
     attempt in any way to reduce any amounts payable to the Executive by the
     Employers pursuant to Sections 4 and 5 hereof. Further, the amount of any
     payment provided for in this Agreement shall not be reduced by any
     compensation earned by the Executive as the result of employment by another
     employer, by retirement benefits, by offset against any amount claimed to
     be owed by the Executive to the Employers, or otherwise.

          (d)  MEDIATION OF DISPUTES. The parties shall endeavor in good faith
     to settle within 90 days any controversy or claim arising out of or
     relating to this Agreement or the breach thereof through mediation with
     JAMS, Endispute or similar organizations. If the controversy or claim is
     not resolved within 90 days, the parties shall be free to pursue other
     legal remedies in law or equity.

     9.   ASSIGNMENT; PRIOR AGREEMENTS. Neither the Employers nor the Executive
may make any assignment of this Agreement or any interest herein, by operation
of law or otherwise, without the prior written consent of the other party, and
without such consent any attempted transfer shall be null and void and of no
effect. This Agreement shall inure to the benefit of and be binding upon the
Employers and the Executive, their respective successors, executors,
administrators, heirs and permitted assigns. In the event of the Executive's
death after a Terminating Event but prior to the completion by the Employers of
all payments due him under Sections 4 and 5 of this Agreement, the Employers
shall continue such payments to the Executive's beneficiary designated in
writing to the Employers prior to his death (or to his estate, if the Executive
fails to make such designation).

                                        8


     10.  ENFORCEABILITY. If any portion or provision of this Agreement shall to
any extent be declared illegal or unenforceable by a court of competent
jurisdiction, then the remainder of this Agreement, or the application of such
portion or provision in circumstances other than those as to which it is so
declared illegal or unenforceable, shall not be affected thereby, and each
portion and provision of this Agreement shall be valid and enforceable to the
fullest extent permitted by law.

     11.  WAIVER. No waiver of any provision hereof shall be effective unless
made in writing and signed by the waiving party. The failure of any party to
require the performance of any term or obligation of this Agreement, or the
waiver by any party of any breach of this Agreement, shall not prevent any
subsequent enforcement of such term or obligation or be deemed a waiver of any
subsequent breach.

     12.  NOTICES. Any notices, requests, demands, and other communications
provided for by this Agreement shall be sufficient if in writing and delivered
in person or sent by registered or certified mail, postage prepaid, to the
Executive at the last address the Executive has filed in writing with the
Employers, or to the Employers at their main office, attention of the Board of
Directors.

     13.  EFFECT ON OTHER PLANS. Nothing in this Agreement shall be construed to
limit the rights of the Executive under the Employers' benefit plans, programs
or policies.

     14.  AMENDMENT. This Agreement may be amended or modified only by a written
instrument signed by the Executive and by a duly authorized representative of
the Employers.

     15.  GOVERNING LAW. This is a Massachusetts contract and shall be construed
under and be governed in all respects by the laws of the Commonwealth of
Massachusetts.

     16.  OBLIGATIONS OF SUCCESSORS. In addition to any obligations imposed by
law upon any successor to the Employers, the Employers will use their best
efforts to require any successor (whether direct or indirect, by purchase,
merger, consolidation or otherwise) to all or substantially all of the business
or assets of the Employers to expressly assume and agree to perform this
Agreement in the same manner and to the same extent that the Employers would be
required to perform if no such succession had taken place.

                                        9


     IN WITNESS WHEREOF, this Agreement has been executed as a sealed instrument
by the Employers by their duly authorized officers and by the Executive, as of
the date first above written.


                                        BOSTON PROPERTIES, INC.

                                        By: /s/ Robert E. Burke
                                            ------------------------------
                                        Name: Robert E. Burke
                                        Title: Executive Vice President


                                        BOSTON PROPERTIES LIMITED PARTNERSHIP


                                        By: /s/ Robert E. Burke
                                            ------------------------------
                                        Name: Robert E. Burke
                                        Title: Executive Vice President


                                        /s/ Mortimer B. Zuckerman
                                        ----------------------------------
                                        Mortimer B. Zuckerman

                                       10



                                                                   EXHIBIT 10.18

                             BOSTON PROPERTIES, INC.

                      SENIOR EXECUTIVE SEVERANCE AGREEMENT

     AGREEMENT made as of this 30th day of July, 1998 by and among Boston
Properties, Inc., a Delaware corporation with its principal place of business in
Boston, Massachusetts (the "Company"), Boston Properties Limited Partnership, a
Delaware limited partnership with its principal place of business in Boston,
Massachusetts ("BPLP") (the Company and BPLP shall be hereinafter collectively
referred to as the "Employers") and Edward H. Linde of Weston, Massachusetts
(the "Executive"), an individual presently employed as the President and Chief
Executive Officer of the Company.

     1.   PURPOSE. The Company considers it essential to the best interests of
its stockholders to foster the continuous employment of key management
personnel. The Board of Directors of the Company (the "Board") recognizes,
however, that, as is the case with many publicly held corporations, the
possibility of a Change in Control (as defined in Section 2 hereof) exists and
that such possibility, and the uncertainty and questions which it may raise
among management, may result in the departure or distraction of management
personnel to the detriment of the Company and its stockholders. Therefore, the
Board has determined that appropriate steps should be taken to reinforce and
encourage the continued attention and dedication of members of the Employers'
management, including the Executive, to their assigned duties without
distraction in the face of potentially disturbing circumstances arising from the
possibility of a Change in Control. Nothing in this Agreement shall be construed
as creating an express or implied contract of employment and, except as
otherwise agreed in writing between the Executive and the Employers, the
Executive shall not have any right to be retained in the employ of the
Employers.

     2.   CHANGE IN CONTROL. For purposes of this Agreement, a "Change in
Control" shall mean the occurrence of any one of the following events:

          (a)  any "PERSON," as such term is used in Sections 13(d) and 14(d) of
     the Act (other than the Employers, Mortimer B. Zuckerman, Edward H. Linde,
     any "AFFILIATE" or "ASSOCIATE" (as such terms are defined in Rule 12b-2
     under the Act) of Mortimer B. Zuckerman or Edward H. Linde, or any trustee,
     fiduciary or other person or entity holding securities under any employee
     benefit plan or trust of the Employers), together with all "AFFILIATES" and
     "ASSOCIATES" (as such terms are defined in Rule 12b-2 under the Act) of
     such person, shall become the "BENEFICIAL OWNER" (as such term is defined
     in Rule 13d-3 under the Act), directly or indirectly, of securities of the
     Company representing 25 percent or more of the combined voting power of the
     Company's then outstanding securities having the right to vote in an
     election of the Company's Board of Directors ("Voting Securities") (other
     than as a result of an acquisition of securities directly from the
     Company); provided that for purposes of determining the "BENEFICIAL
     OWNERSHIP" (as such term is defined in Rule 13d-3 under the Act) of any
     "GROUP" of



     which Mortimer B. Zuckerman, Edward H. Linde or any of their affiliates or
     associates is a member (each such entity or individual, a "Related Party"),
     there shall not be attributed to the "BENEFICIAL OWNERSHIP" (as such term
     is defined in Rule 13d-3 under the Act) of such group any shares
     beneficially owned by any Related Party; or

          (b)  persons who, as of the effective date of the Company's initial
     public offering of Stock, constitute the Company's Board of Directors (the
     "Incumbent Directors") cease for any reason, including, without limitation,
     as a result of a tender offer, proxy contest, merger or similar
     transaction, to constitute at least a majority of the Board, provided that
     any person becoming a director of the Company subsequent to such date shall
     be considered an Incumbent Director if such person's election was approved
     by or such person was nominated for election by either (A) a vote of at
     least two-thirds of the Incumbent Directors or (B) a vote of at least a
     majority of the Incumbent Directors who are members of a nominating
     committee comprised, in the majority, of Incumbent Directors; or

          (c)  the stockholders of the Company shall approve (A) any
     consolidation or merger of the Company where the stockholders of the
     Company, immediately prior to the consolidation or merger, would not,
     immediately after the consolidation or merger, "BENEFICIALLY OWN" (as such
     term is defined in Rule 13d-3 under the Act), directly or indirectly,
     shares representing in the aggregate 60 percent or more of the voting
     shares of the corporation issuing cash or securities in the consolidation
     or merger (or of its ultimate parent corporation, if any), (B) any sale,
     lease, exchange or other transfer to an unrelated party (in one transaction
     or a series of transactions contemplated or arranged by any party as a
     single plan) of all or substantially all of the assets of the Company or
     (C) any plan or proposal for the liquidation or dissolution of the Company.

     Notwithstanding the foregoing, a "Change of Control" shall not be deemed to
have occurred for purposes of the foregoing clause (a) solely as the result of
an acquisition of securities by the Company which, by reducing the number of
shares of Voting Securities outstanding, increases the proportionate number of
shares of Voting Securities beneficially owned by any person (as defined in the
foregoing clause (a)) to 25 percent or more of the combined voting power of all
then outstanding Voting Securities; PROVIDED, HOWEVER, that if such person shall
thereafter become the beneficial owner of any additional shares of Voting
Securities (other than pursuant to a stock split, stock dividend, or similar
transaction or as a result of an acquisition of securities directly from the
Company), then a "CHANGE OF CONTROL" shall be deemed to have occurred for
purposes of the foregoing clause (a).

     3.   TERMINATING EVENT. A "Terminating Event" shall mean any of the events
provided in this Section 3 occurring within twenty-four (24) months following a
Change in Control:

          (a)  termination by the Employers of the employment of the Executive
     with the Employers for any reason other than for Cause or the death of the
     Executive. "Cause" shall mean, and shall be limited to, the occurrence of
     any one or more of the following events:

                                        2


               (i)   a willful act of dishonesty by the Executive with respect
          to any matter involving any of the Employers; or

               (ii)  conviction of the Executive of a crime involving moral
          turpitude; or

               (iii) the deliberate or willful failure by the Executive (other
          than by reason of the Executive's physical or mental illness,
          incapacity or disability) to substantially perform the Executive's
          duties with the Employers and the continuation of such failure for a
          period of 30 days after delivery by the Employers to the Executive of
          written notice specifying the scope and nature of such failure and
          their intention to terminate the Executive for Cause.

          A Terminating Event shall not be deemed to have occurred pursuant to
     this Section 3(a) solely as a result of the Executive being an employee of
     any direct or indirect successor to the business or assets of either of the
     Employers, rather than continuing as an employee of the Employers following
     a Change in Control. For purposes of clauses (i) and (iii) of this Section
     3(a), no act, or failure to act, on the Executive's part shall be deemed
     "willful" unless done, or omitted to be done, by the Executive without
     reasonable belief that the Executive's act, or failure to act, was in the
     best interest of the Employers; or

          (b)  termination by the Executive of the Executive's employment with
     the Employers for Good Reason. "Good Reason" shall mean the occurrence of
     any of the following events:

               (i)   a substantial adverse change in the nature or scope of the
          Executive's responsibilities, authorities, title, powers, functions,
          or duties from the responsibilities, authorities, powers, functions,
          or duties exercised by the Executive immediately prior to the Change
          in Control; or

               (ii)  a reduction in the Executive's annual base salary as in
          effect on the date hereof or as the same may be increased from time to
          time except for across-the-board salary reductions similarly affecting
          all or substantially all management employees; or

               (iii) the relocation of the Employers' offices at which the
          Executive is principally employed immediately prior to the date of a
          Change in Control to a location more than thirty (30) miles from such
          offices, or the requirement by the Employers for the Executive to be
          based anywhere other than the Employers' offices at such location,
          except for required travel on the Employers' business to an extent
          substantially consistent with the Executive's business travel
          obligations immediately prior to the Change in Control; or

                                        3


               (iv)  the failure by the Employers to pay to the Executive any
          portion of his compensation or to pay to the Executive any portion of
          an installment of deferred compensation under any deferred
          compensation program of the Employers within fifteen (15) days of the
          date such compensation is due without prior written consent of the
          Executive; or

               (v)   the failure by the Employers to obtain an effective
          agreement from any successor to assume and agree to perform this
          Agreement.

     4.   SPECIAL TERMINATION PAYMENTS. In the event a Terminating Event occurs
within twenty-four (24) months after a Change in Control,

          (a)  the Employers shall pay to the Executive an amount equal to the
     following:

               (i)   $3,000,000 if the Date of Termination (as such term is
          defined in Section 9(b)) is in calendar year 1998; or

               (ii)  $3,300,000 if the Date of Termination is in calendar year
          1999; or

               (iii) $3,630,000 if the Date of Termination is in calendar year
          2000 or later.

     Said amount shall be paid in one lump sum payment no later than thirty-one
     (31) days following the Date of Termination; and

          (b)  the Employers shall continue to provide health, dental and life
     insurance to the Executive, on the same terms and conditions as though the
     Executive had remained an active employee, for thirty-six (36) months after
     the Terminating Event; and

          (c)  the Employers shall provide COBRA benefits to the Executive
     following the end of the period referred to in Section 4(b) above, such
     benefits to be determined as though the Executive's employment had
     terminated at the end of such period; and

          (d)  the Employers shall pay to the Executive all reasonable legal and
     mediation fees and expenses incurred by the Executive in obtaining or
     enforcing any right or benefit provided by this Agreement, except in cases
     involving frivolous or bad faith litigation initiated by the Executive; and

          (e)  the Employers shall provide to the Executive financial
     counseling, tax preparation assistance and outplacement counseling for
     thirty-six (36) months after the Terminating Event.

     Notwithstanding the foregoing, the special termination benefits required by
Section 4(a) shall be offset by any amount paid or payable to the Executive by
the Employers under the terms of any employment agreement or other plan.

                                        4


     5.   ADDITIONAL BENEFITS.

          (a)  Anything in this Agreement to the contrary notwithstanding, in
     the event it shall be determined that any compensation payment or
     distribution by the Employers to or for the benefit of the Executive,
     whether paid or payable or distributed or distributable pursuant to the
     terms of this Agreement or otherwise (the "Severance Payments"), would be
     subject to the excise tax imposed by Section 4999 of the Internal Revenue
     Code of 1986, as amended (the "Code"), or any interest or penalties are
     incurred by the Executive with respect to such excise tax (such excise tax,
     together with any such interest and penalties, are hereinafter collectively
     referred to as the "Excise Tax"), then the Executive shall be entitled to
     receive an additional payment (a "Gross-Up Payment") such that the net
     amount retained by the Executive, after deduction of any Excise Tax on the
     Severance Payments, any Federal, state, and local income tax, employment
     tax and Excise Tax upon the payment provided by this subsection, and any
     interest and/or penalties assessed with respect to such Excise Tax and not
     after the deduction of any other taxes or amounts, shall be equal to the
     Severance Payments. (The Gross-Up Payment is not intended to compensate the
     Executive for any income taxes payable with respect to the Severance
     Payments.)

          (b)  Subject to the provisions of Section 5(c), all determinations
     required to be made under this Section 5, including whether a Gross-Up
     Payment is required and the amount of such Gross-Up Payment, shall be made
     by Coopers & Lybrand, L.L.P. or any other nationally recognized accounting
     firm selected by the Employers (the "Accounting Firm"), which shall provide
     detailed supporting calculations both to the Employers and the Executive
     within 15 business days of the Date of Termination, if applicable, or at
     such earlier time as is reasonably requested by the Employers or the
     Executive. For purposes of determining the amount of the Gross-Up Payment,
     the Executive shall be deemed to pay federal income taxes at the highest
     marginal rate of federal income taxation applicable to individuals for the
     calendar year in which the Gross-Up Payment is to be made, and state and
     local income taxes at the highest marginal rates of individual taxation in
     the state and locality of the Executive's residence on the Date of
     Termination, net of the maximum reduction in federal income taxes which
     could be obtained from deduction of such state and local taxes. The initial
     Gross-Up Payment, if any, as determined pursuant to this Section 5(b),
     shall be paid to the Executive within five days of the receipt of the
     Accounting Firm's determination. If the Accounting Firm determines that no
     Excise Tax is payable by the Executive, the Employers shall furnish the
     Executive with an opinion of counsel that failure to report the Excise Tax
     on the Executive's applicable federal income tax return would not result in
     the imposition of a negligence or similar penalty. Any determination by the
     Accounting Firm shall be binding upon the Employers and the Executive. As a
     result of the uncertainty in the application of Section 4999 of the Code at
     the time of the initial determination by the Accounting Firm hereunder, it
     is possible that Gross-Up Payments which will not have been made by the
     Employers should have been made (an "Underpayment"). In the event that the
     Employers exhaust their remedies pursuant to Section 5(c) and the Executive
     thereafter is required to make a payment of any Excise Tax, the Accounting
     Firm shall

                                        5


     determine the amount of the Underpayment that has occurred, consistent with
     the calculations required to be made hereunder, and any such Underpayment,
     and any interest and penalties imposed on the Underpayment and required to
     be paid by the Executive in connection with the proceedings described in
     Section 5(c), shall be promptly paid by the Employers to or for the benefit
     of the Executive.

          (c)  The Executive shall notify the Employers in writing of any claim
     by the Internal Revenue Service that, if successful, would require the
     payment by the Employers of the Gross-Up Payment. Such notification shall
     be given as soon as practicable but no later than 10 business days after
     the Executive knows of such claim and shall apprise the Employers of the
     nature of such claim and the date on which such claim is requested to be
     paid. The Executive shall not pay such claim prior to the expiration of the
     30-day period following the date on which he gives such notice to the
     Employers (or such shorter period ending on the date that any payment of
     taxes with respect to such claim is due). If the Employers notify the
     Executive in writing prior to the expiration of such period that they
     desire to contest such claim, provided that the Employers have set aside
     adequate reserves to cover the Underpayment and any interest and penalties
     thereon that may accrue, the Executive shall:
               (i)   give the Employers any information reasonably requested by
          the Employers relating to such claim,

               (ii)  take such action in connection with contesting such claim
          as the Employers shall reasonably request in writing from time to
          time, including, without limitation, accepting legal representation
          with respect to such claim by an attorney selected by the Employers,

               (iii) cooperate with the Employers in good faith in order
          effectively to contest such claim, and

               (iv)  permit the Employers to participate in any proceedings
          relating to such claim; provided, however, that the Employers shall
          bear and pay directly all costs and expenses (including additional
          interest and penalties) incurred in connection with such contest and
          shall indemnify and hold the Executive harmless, on an after-tax
          basis, for any Excise Tax or income tax, including interest and
          penalties with respect thereto, imposed as a result of such
          representation and payment of costs and expenses. Without limitation
          on the foregoing provisions of this Section 5(c), the Employers shall
          control all proceedings taken in connection with such contest and, at
          their sole option, may pursue or forego any and all administrative
          appeals, proceedings, hearings and conferences with the taxing
          authority in respect of such claim and may, at their sole option,
          either direct the Executive to pay the tax claimed and sue for a
          refund or contest the claim in any permissible manner, and the
          Executive agrees to prosecute such contest to a determination before
          any administrative tribunal, in a court of initial jurisdiction and in
          one or more appellate courts, as the Employers shall determine;
          provided, however, that if the Employers direct the Executive to

                                        6


          pay such claim and sue for a refund, the Employers shall advance the
          amount of such payment to the Executive on an interest-free basis and
          shall indemnify and hold the Executive harmless, on an after-tax
          basis, from any Excise Tax or income tax, including interest or
          penalties with respect thereto, imposed with respect to such advance
          or with respect to any imputed income with respect to such advance;
          and further provided that any extension of the statute of limitations
          relating to payment of taxes for the taxable year of the Executive
          with respect to which such contested amount is claimed to be due is
          limited solely to such contested amount. Furthermore, the Employers'
          control of the contest shall be limited to issues with respect to
          which a Gross-Up Payment would be payable hereunder and the Executive
          shall be entitled to settle or contest, as the case may be, any other
          issues raised by the Internal Revenue Service or any other taxing
          authority.

          (d)  If, after the receipt by the Executive of an amount advanced by
     the Employers pursuant to Section 5(c), the Executive becomes entitled to
     receive any refund with respect to such claim, the Executive shall (subject
     to the Employers' complying with the requirements of Section 5(c)) promptly
     pay to the Employers the amount of such refund (together with any interest
     paid or credited thereon after taxes applicable thereto). If, after the
     receipt by the Executive of an amount advanced by the Employers pursuant to
     Section 5(c), a determination is made that the Executive shall not be
     entitled to any refund with respect to such claim and the Employers do not
     notify the Executive in writing of their intent to contest such denial of
     refund prior to the expiration of 30 days after such determination, then
     such advance shall be forgiven and shall not be required to be repaid and
     the amount of such advance shall offset, to the extent thereof, the amount
     of Gross-Up Payment required to be paid.

     6.   TERM. This Agreement shall take effect on the date first set forth
above and shall terminate upon the earliest of (a) the termination by the
Employers of the employment of the Executive for Cause; (b) the resignation or
voluntary termination of the Executive for any reason prior to a Change in
Control; or (c) the resignation of the Executive after a Change in Control for
any reason other than the occurrence of any of the events enumerated in Section
3(b)(i)-(v) of this Agreement.

     7.   WITHHOLDING. All payments made by the Employers under this Agreement
shall be net of any tax or other amounts required to be withheld by the
Employers under applicable law.

     8.   NOTICE AND DATE OF TERMINATION; DISPUTES; ETC.

          (a)  NOTICE OF TERMINATION. After a Change in Control and during the
     term of this Agreement, any purported termination of the Executive's
     employment (other than by reason of death) shall be communicated by written
     Notice of Termination from one party hereto to the other party hereto in
     accordance with this Section 8. For purposes of this Agreement, a "Notice
     of Termination" shall mean a notice which shall indicate the specific
     termination provision in this Agreement relied upon and the Date of
     Termination. Further, a Notice of Termination for Cause is required to
     include a copy of

                                        7


     a resolution duly adopted by the affirmative vote of not less than
     two-thirds (2/3) of the entire membership of the Board at a meeting of the
     Board (after reasonable notice to the Executive and an opportunity for the
     Executive, accompanied by the Executive's counsel, to be heard before the
     Board) finding that, in the good faith opinion of the Board, the
     termination met the criteria for Cause set forth in Section 3(a) hereof.

          (b)  DATE OF TERMINATION. "Date of Termination," with respect to any
     purported termination of the Executive's employment after a Change in
     Control and during the term of this Agreement, shall mean the date
     specified in the Notice of Termination. In the case of a termination by the
     Employers other than a termination for Cause (which may be effective
     immediately), the Date of Termination shall not be less than 30 days after
     the Notice of Termination is given. In the case of a termination by the
     Executive, the Date of Termination shall not be less than 15 days from the
     date such Notice of Termination is given. Notwithstanding Section 3(a) of
     this Agreement, in the event that the Executive gives a Notice of
     Termination to the Employers, the Employers may unilaterally accelerate the
     Date of Termination and such acceleration shall not result in a second
     Terminating Event for purposes of Section 3(a) of this Agreement.

          (c)  NO MITIGATION. The Employers agree that, if the Executive's
     employment by the Employers is terminated during the term of this
     Agreement, the Executive is not required to seek other employment or to
     attempt in any way to reduce any amounts payable to the Executive by the
     Employers pursuant to Sections 4 and 5 hereof. Further, the amount of any
     payment provided for in this Agreement shall not be reduced by any
     compensation earned by the Executive as the result of employment by another
     employer, by retirement benefits, by offset against any amount claimed to
     be owed by the Executive to the Employers, or otherwise.

          (d)  MEDIATION OF DISPUTES. The parties shall endeavor in good faith
     to settle within 90 days any controversy or claim arising out of or
     relating to this Agreement or the breach thereof through mediation with
     JAMS, Endispute or similar organizations. If the controversy or claim is
     not resolved within 90 days, the parties shall be free to pursue other
     legal remedies in law or equity.

     9.   ASSIGNMENT; PRIOR AGREEMENTS. Neither the Employers nor the Executive
may make any assignment of this Agreement or any interest herein, by operation
of law or otherwise, without the prior written consent of the other party, and
without such consent any attempted transfer shall be null and void and of no
effect. This Agreement shall inure to the benefit of and be binding upon the
Employers and the Executive, their respective successors, executors,
administrators, heirs and permitted assigns. In the event of the Executive's
death after a Terminating Event but prior to the completion by the Employers of
all payments due him under Sections 4 and 5 of this Agreement, the Employers
shall continue such payments to the Executive's beneficiary designated in
writing to the Employers prior to his death (or to his estate, if the Executive
fails to make such designation).

     10.  ENFORCEABILITY. If any portion or provision of this Agreement shall to
any extent be declared illegal or unenforceable by a court of competent
jurisdiction, then the remainder of

                                        8


this Agreement, or the application of such portion or provision in circumstances
other than those as to which it is so declared illegal or unenforceable, shall
not be affected thereby, and each portion and provision of this Agreement shall
be valid and enforceable to the fullest extent permitted by law.

     11.  WAIVER. No waiver of any provision hereof shall be effective unless
made in writing and signed by the waiving party. The failure of any party to
require the performance of any term or obligation of this Agreement, or the
waiver by any party of any breach of this Agreement, shall not prevent any
subsequent enforcement of such term or obligation or be deemed a waiver of any
subsequent breach.

     12.  NOTICES. Any notices, requests, demands, and other communications
provided for by this Agreement shall be sufficient if in writing and delivered
in person or sent by registered or certified mail, postage prepaid, to the
Executive at the last address the Executive has filed in writing with the
Employers, or to the Employers at their main office, attention of the Board of
Directors.

     13.  EFFECT ON OTHER PLANS. Nothing in this Agreement shall be construed to
limit the rights of the Executive under the Employers' benefit plans, programs
or policies.

     14.  AMENDMENT. This Agreement may be amended or modified only by a written
instrument signed by the Executive and by a duly authorized representative of
the Employers.

     15. GOVERNING LAW. This is a Massachusetts contract and shall be construed
under and be governed in all respects by the laws of the Commonwealth of
Massachusetts.

     16.  OBLIGATIONS OF SUCCESSORS. In addition to any obligations imposed by
law upon any successor to the Employers, the Employers will use their best
efforts to require any successor (whether direct or indirect, by purchase,
merger, consolidation or otherwise) to all or substantially all of the business
or assets of the Employers to expressly assume and agree to perform this
Agreement in the same manner and to the same extent that the Employers would be
required to perform if no such succession had taken place.

                                        9


     IN WITNESS WHEREOF, this Agreement has been executed as a sealed instrument
by the Employers by their duly authorized officers and by the Executive, as of
the date first above written.


                                        BOSTON PROPERTIES, INC.

                                        By: /s/ Robert E. Burke
                                            ------------------------------
                                        Name: Robert E. Burke
                                        Title: Executive Vice President


                                        BOSTON PROPERTIES LIMITED PARTNERSHIP


                                        By: /s/ Robert E. Burke
                                            ------------------------------
                                        Name: Robert E. Burke
                                        Title: Executive Vice President


                                        /s/ Edward H. Linde
                                        ----------------------------------
                                        Edward H. Linde

                                       10



                                                                   EXHIBIT 10.19

                             BOSTON PROPERTIES, INC.

                         SENIOR EXECUTIVE SEVERANCE PLAN

     1.   PURPOSE. Boston Properties, Inc. (the "Company") considers it
essential to the best interests of its stockholders to foster the continuous
employment of key management personnel. The Board of Directors of the Company
(the "Board") recognizes, however, that, as is the case with many publicly held
corporations, the possibility of a Change in Control (as defined in Section 2
hereof) exists and that such possibility, and the uncertainty and questions
which it may raise among management, may result in the departure or distraction
of management personnel to the detriment of the Company and its stockholders.
Therefore, the Board has determined that the Boston Properties, Inc. Senior
Executive Severance Plan (the "Plan") should be adopted to reinforce and
encourage the continued attention and dedication of the Executive
Vice-Presidents of the Company, the Chief Financial Officer of the Company and
the Regional Office Heads of the Company (each, a "Covered Employee";
collectively, the "Covered Employees"), to their assigned duties without
distraction in the face of potentially disturbing circumstances arising from the
possibility of a Change in Control. Nothing in this Plan shall be construed as
creating an express or implied contract of employment and, except as otherwise
agreed in writing between the Covered Employee and the Company or any of its
subsidiaries or affiliates (together with the Company, the "Employers"), the
Covered Employee shall not have any right to be retained in the employ of the
Employers.

     2.   CHANGE IN CONTROL. For purposes of this Plan, a "Change in Control"
shall mean the occurrence of any one of the following events:

          (a)  any "PERSON," as such term is used in Sections 13(d) and 14(d) of
     the Act (other than any of the Employers, Mortimer B. Zuckerman, Edward H.
     Linde, any "AFFILIATE" or "ASSOCIATE" (as such terms are defined in Rule
     12b-2 under the Act) of Mortimer B. Zuckerman or Edward H. Linde, or any
     trustee, fiduciary or other person or entity holding securities under any
     employee benefit plan or trust of any of the Employers), together with all
     "AFFILIATES" and "ASSOCIATES" (as such terms are defined in Rule 12b-2
     under the Act) of such person, shall become the "BENEFICIAL OWNER" (as such
     term is defined in Rule 13d-3 under the Act), directly or indirectly, of
     securities of the Company representing 25 percent or more of the combined
     voting power of the Company's then outstanding securities having the right
     to vote in an election of the Company's Board of Directors ("Voting
     Securities") (other than as a result of an acquisition of securities
     directly from the Company); provided that for purposes of determining the
     "BENEFICIAL OWNERSHIP" (as such term is defined in Rule 13d-3 under the
     Act) of any "GROUP" of which Mortimer B. Zuckerman, Edward H. Linde or any
     of their affiliates or associates is a member (each such entity or
     individual, a "Related Party"), there shall not be attributed to the
     "BENEFICIAL OWNERSHIP" (as such term is defined in Rule 13d-3 under the
     Act) of such group any shares beneficially owned by any Related Party; or



          (b)  persons who, as of the effective date of the Company's initial
     public offering of Stock, constitute the Company's Board of Directors (the
     "Incumbent Directors") cease for any reason, including, without limitation,
     as a result of a tender offer, proxy contest, merger or similar
     transaction, to constitute at least a majority of the Board, provided that
     any person becoming a director of the Company subsequent to such date shall
     be considered an Incumbent Director if such person's election was approved
     by or such person was nominated for election by either (A) a vote of at
     least two-thirds of the Incumbent Directors or (B) a vote of at least a
     majority of the Incumbent Directors who are members of a nominating
     committee comprised, in the majority, of Incumbent Directors; or

          (c)  the stockholders of the Company shall approve (A) any
     consolidation or merger of the Company where the stockholders of the
     Company, immediately prior to the consolidation or merger, would not,
     immediately after the consolidation or merger, "BENEFICIALLY OWN" (as such
     term is defined in Rule 13d-3 under the Act), directly or indirectly,
     shares representing in the aggregate 60 percent or more of the voting
     shares of the corporation issuing cash or securities in the consolidation
     or merger (or of its ultimate parent corporation, if any), (B) any sale,
     lease, exchange or other transfer to an unrelated party (in one transaction
     or a series of transactions contemplated or arranged by any party as a
     single plan) of all or substantially all of the assets of the Company or
     (C) any plan or proposal for the liquidation or dissolution of the Company.

     Notwithstanding the foregoing, a "Change of Control" shall not be deemed to
have occurred for purposes of the foregoing clause (a) solely as the result of
an acquisition of securities by the Company which, by reducing the number of
shares of Voting Securities outstanding, increases the proportionate number of
shares of Voting Securities beneficially owned by any person (as defined in the
foregoing clause (a)) to 25 percent or more of the combined voting power of all
then outstanding Voting Securities; PROVIDED, HOWEVER, that if such person shall
thereafter become the beneficial owner of any additional shares of Voting
Securities (other than pursuant to a stock split, stock dividend, or similar
transaction or as a result of an acquisition of securities directly from the
Company), then a "CHANGE OF CONTROL" shall be deemed to have occurred for
purposes of the foregoing clause (a).

     3.   TERMINATING EVENT. A "Terminating Event" shall mean the termination of
employment of a Covered Employee in connection with any of the events provided
in this Section 3 occurring within twenty-four (24) months following a Change in
Control:

          (a)  termination by the Employers of the employment of the Covered
     Employee with the Employers for any reason other than for Cause or the
     death or disability (as determined under the Employers' then existing
     long-term disability coverage) of such Covered Employee. "Cause" shall
     mean, and shall be limited to, the occurrence of any one or more of the
     following events:

               (i)   a willful act of dishonesty by the Covered Employee with
          respect to any matter involving any of the Employers; or

                                        2


               (ii)  conviction of the Covered Employee of a crime involving
          moral turpitude; or

               (iii) the deliberate or willful failure by the Covered Employee
          (other than by reason of the Covered Employee's physical or mental
          illness, incapacity or disability) to substantially perform the
          Covered Employee's duties with the Employers and the continuation of
          such failure for a period of 30 days after delivery by the Employers
          to the Covered Employee of written notice specifying the scope and
          nature of such failure and their intention to terminate the Covered
          Employee for Cause.

          A Terminating Event shall not be deemed to have occurred pursuant to
     this Section 3(a) solely as a result of the Covered Employee being an
     employee of any direct or indirect successor to the business or assets of
     either of the Employers, rather than continuing as an employee of the
     Employers following a Change in Control. For purposes of clauses (i) and
     (iii) of this Section 3(a), no act, or failure to act, on the Covered
     Employee's part shall be deemed "willful" unless done, or omitted to be
     done, by the Covered Employee without reasonable belief that the Covered
     Employee's act, or failure to act, was in the best interest of the
     Employers; or

          (b)  termination by the Covered Employee of the Covered Employee's
     employment with the Employers for Good Reason. "Good Reason" shall mean the
     occurrence of any of the following events:

               (i)   a substantial adverse change in the nature or scope of the
          Covered Employee's responsibilities, authorities, title, powers,
          functions, or duties from the responsibilities, authorities, powers,
          functions, or duties exercised by the Covered Employee immediately
          prior to the Change in Control; or

               (ii)  a reduction in the Covered Employee's annual base salary as
          in effect on the date hereof or as the same may be increased from time
          to time except for across-the-board salary reductions similarly
          affecting all or substantially all management employees; or

               (iii) the relocation of the Employers' offices at which the
          Covered Employee is principally employed immediately prior to the date
          of a Change in Control to a location more than thirty (30) miles from
          such offices, or the requirement by the Employers for the Covered
          Employee to be based anywhere other than the Employers' offices at
          such location, except for required travel on the Employers' business
          to an extent substantially consistent with the Covered Employee's
          business travel obligations immediately prior to the Change in
          Control; or

               (iv)  the failure by the Employers to pay to the Covered Employee
          any portion of his compensation or to pay to the Covered Employee any
          portion of an installment of deferred compensation under any deferred
          compensation program

                                        3


          of the Employers within fifteen (15) days of the date such
          compensation is due without prior written consent of the Covered
          Employee; or

               (v)   the failure by the Employers to obtain an effective
          agreement from any successor to assume and agree to perform this
          Agreement.

     4.   SPECIAL TERMINATION BENEFITS. In the event a Terminating Event occurs
within twenty-four (24) months after a Change in Control with respect to a
Covered Employee,

          (a)  the Employers shall pay to the Covered Employee an amount equal
     to the sum of the following:

               (i)   three (3) times the amount of the current annual base
          salary of the Covered Employee, determined prior to any reductions for
          pre-tax contributions to a cash or deferred arrangement or a cafeteria
          plan; and

               (ii)  three (3) times the amount of the average annual bonus
          earned by the Covered Employee with respect to the three (3) calendar
          years immediately prior to the Change in Control.

     Said amount shall be paid in one lump sum payment no later than thirty-one
     (31) days following the Date of Termination (as such term is defined in
     Section 7(b)); and

          (b)  the Employers shall continue to provide health, dental and life
     insurance to the Covered Employee, on the same terms and conditions as
     though the Covered Employee had remained an active employee, for thirty-six
     (36) months after the Terminating Event; and

          (c)  the Employers shall provide COBRA benefits to the Covered
     Employee following the end of the period referred to in Section 4(b) above,
     such benefits to be determined as though the Covered Employee's employment
     had terminated at the end of such period; and

          (d)  the Employers shall pay to the Covered Employee all reasonable
     legal and mediation fees and expenses incurred by the Covered Employee in
     obtaining or enforcing any right or benefit provided by this Plan, except
     in cases involving frivolous or bad faith litigation initiated by the
     Covered Employee; and

          (e)  the Employers shall provide to the Covered Employee financial
     counseling, tax preparation assistance and outplacement counseling for
     thirty-six (36) months after the Terminating Event.

     Notwithstanding the foregoing, the special termination benefits required by
Section 4(a) shall be offset by any amount paid or payable to the Covered
Employee by the Employers under the terms of any employment agreement or other
plan.

                                        4


     5.   ADDITIONAL BENEFITS.

          (a)  Anything in this Plan to the contrary notwithstanding, in the
     event it shall be determined that any compensation payment or distribution
     by the Employers to or for the benefit of the Covered Employee, whether
     paid or payable or distributed or distributable pursuant to the terms of
     this Plan or otherwise (the "Severance Payments"), would be subject to the
     excise tax imposed by Section 4999 of the Internal Revenue Code of 1986, as
     amended (the "Code"), or any interest or penalties are incurred by the
     Covered Employee with respect to such excise tax (such excise tax, together
     with any such interest and penalties, are hereinafter collectively referred
     to as the "Excise Tax"), then the Covered Employee shall be entitled to
     receive an additional payment (a "Gross-Up Payment") such that the net
     amount retained by the Covered Employee, after deduction of any Excise Tax
     on the Severance Payments, any Federal, state, and local income tax,
     employment tax and Excise Tax upon the payment provided by this subsection,
     and any interest and/or penalties assessed with respect to such Excise Tax
     and not after the deduction of any other taxes or amounts, shall be equal
     to the Severance Payments. (The Gross-Up Payment is not intended to
     compensate the Covered Employee for any income taxes payable with respect
     to the Severance Payments.)

          (b)  Subject to the provisions of Section 5(c), all determinations
     required to be made under this Section 5, including whether a Gross-Up
     Payment is required and the amount of such Gross-Up Payment, shall be made
     by Coopers & Lybrand, L.L.P. or any other nationally recognized accounting
     firm selected by the Employers (the "Accounting Firm"), which shall provide
     detailed supporting calculations both to the Employers and the Covered
     Employee within 15 business days of the Date of Termination, if applicable,
     or at such earlier time as is reasonably requested by the Employers or the
     Covered Employee. For purposes of determining the amount of the Gross-Up
     Payment, the Covered Employee shall be deemed to pay federal income taxes
     at the highest marginal rate of federal income taxation applicable to
     individuals for the calendar year in which the Gross-Up Payment is to be
     made, and state and local income taxes at the highest marginal rates of
     individual taxation in the state and locality of the Covered Employee's
     residence on the Date of Termination, net of the maximum reduction in
     federal income taxes which could be obtained from deduction of such state
     and local taxes. The initial Gross-Up Payment, if any, as determined
     pursuant to this Section 5(b), shall be paid to the Covered Employee within
     five days of the receipt of the Accounting Firm's determination. If the
     Accounting Firm determines that no Excise Tax is payable by the Covered
     Employee, the Employers shall furnish the Covered Employee with an opinion
     of counsel that failure to report the Excise Tax on the Covered Employee's
     applicable federal income tax return would not result in the imposition of
     a negligence or similar penalty. Any determination by the Accounting Firm
     shall be binding upon the Employers and the Covered Employee. As a result
     of the uncertainty in the application of Section 4999 of the Code at the
     time of the initial determination by the Accounting Firm hereunder, it is
     possible that Gross-Up Payments which will not have been made by the
     Employers should have been made (an "Underpayment"). In the event that the
     Employers exhaust their remedies pursuant to Section 5(c) and the Covered
     Employee thereafter is required to make a payment of any Excise Tax, the
     Accounting Firm shall

                                        5


     determine the amount of the Underpayment that has occurred, consistent with
     the calculations required to be made hereunder, and any such Underpayment,
     and any interest and penalties imposed on the Underpayment and required to
     be paid by the Covered Employee in connection with the proceedings
     described in Section 5(c), shall be promptly paid by the Employers to or
     for the benefit of the Covered Employee.

          (c)  The Covered Employee shall notify the Employers in writing of any
     claim by the Internal Revenue Service that, if successful, would require
     the payment by the Employers of the Gross-Up Payment. Such notification
     shall be given as soon as practicable but no later than 10 business days
     after the Covered Employee knows of such claim and shall apprise the
     Employers of the nature of such claim and the date on which such claim is
     requested to be paid. The Covered Employee shall not pay such claim prior
     to the expiration of the 30-day period following the date on which he gives
     such notice to the Employers (or such shorter period ending on the date
     that any payment of taxes with respect to such claim is due). If the
     Employers notify the Covered Employee in writing prior to the expiration of
     such period that they desire to contest such claim, provided that the
     Employers have set aside adequate reserves to cover the Underpayment and
     any interest and penalties thereon that may accrue, the Covered Employee
     shall:

               (i)   give the Employers any information reasonably requested by
          the Employers relating to such claim,

               (ii)  take such action in connection with contesting such claim
          as the Employers shall reasonably request in writing from time to
          time, including, without limitation, accepting legal representation
          with respect to such claim by an attorney selected by the Employers,

               (iii) cooperate with the Employers in good faith in order
          effectively to contest such claim, and

               (iv)  permit the Employers to participate in any proceedings
          relating to such claim; provided, however, that the Employers shall
          bear and pay directly all costs and expenses (including additional
          interest and penalties) incurred in connection with such contest and
          shall indemnify and hold the Covered Employee harmless, on an
          after-tax basis, for any Excise Tax or income tax, including interest
          and penalties with respect thereto, imposed as a result of such
          representation and payment of costs and expenses. Without limitation
          on the foregoing provisions of this Section 5(c), the Employers shall
          control all proceedings taken in connection with such contest and, at
          their sole option, may pursue or forego any and all administrative
          appeals, proceedings, hearings and conferences with the taxing
          authority in respect of such claim and may, at their sole option,
          either direct the Covered Employee to pay the tax claimed and sue for
          a refund or contest the claim in any permissible manner, and the
          Covered Employee agrees to prosecute such contest to a determination
          before any administrative tribunal, in a court of initial jurisdiction
          and in one or more appellate courts, as the Employers shall determine;
          provided, however, that if the

                                        6


          Employers direct the Covered Employee to pay such claim and sue for a
          refund, the Employers shall advance the amount of such payment to the
          Covered Employee on an interest-free basis and shall indemnify and
          hold the Covered Employee harmless, on an after-tax basis, from any
          Excise Tax or income tax, including interest or penalties with respect
          thereto, imposed with respect to such advance or with respect to any
          imputed income with respect to such advance; and further provided that
          any extension of the statute of limitations relating to payment of
          taxes for the taxable year of the Covered Employee with respect to
          which such contested amount is claimed to be due is limited solely to
          such contested amount. Furthermore, the Employers' control of the
          contest shall be limited to issues with respect to which a Gross-Up
          Payment would be payable hereunder and the Covered Employee shall be
          entitled to settle or contest, as the case may be, any other issues
          raised by the Internal Revenue Service or any other taxing authority.

          (d)  If, after the receipt by the Covered Employee of an amount
     advanced by the Employers pursuant to Section 5(c), the Covered Employee
     becomes entitled to receive any refund with respect to such claim, the
     Covered Employee shall (subject to the Employers' complying with the
     requirements of Section 5(c)) promptly pay to the Employers the amount of
     such refund (together with any interest paid or credited thereon after
     taxes applicable thereto). If, after the receipt by the Covered Employee of
     an amount advanced by the Employers pursuant to Section 5(c), a
     determination is made that the Covered Employee shall not be entitled to
     any refund with respect to such claim and the Employers do not notify the
     Covered Employee in writing of their intent to contest such denial of
     refund prior to the expiration of 30 days after such determination, then
     such advance shall be forgiven and shall not be required to be repaid and
     the amount of such advance shall offset, to the extent thereof, the amount
     of Gross-Up Payment required to be paid.

     6.   WITHHOLDING. All payments made by the Employers under this Plan shall
be net of any tax or other amounts required to be withheld by the Employers
under applicable law.

     7.   NOTICE AND DATE OF TERMINATION; DISPUTES; ETC.

          (a)  NOTICE OF TERMINATION. Within twenty-four (24) months after a
     Change in Control, any purported termination of a Covered Employee's
     employment (other than by reason of death) shall be communicated by written
     Notice of Termination from the Employers to the Covered Employee or vice
     versa in accordance with this Section 7. For purposes of this Plan, a
     "Notice of Termination" shall mean a notice which shall indicate the
     specific termination provision in this Plan relied upon and the Date of
     Termination. Further, a Notice of Termination for Cause is required to
     include a copy of a resolution duly adopted by the affirmative vote of not
     less than two-thirds (2/3) of the entire membership of the Board at a
     meeting of the Board (after reasonable notice to the Covered Employee and
     an opportunity for the Covered Employee, accompanied by the Covered
     Employee's counsel, to be heard before the Board) finding that, in the good
     faith

                                        7


     opinion of the Board, the termination met the criteria for Cause set forth
     in Section 3(a) hereof.

          (b)  DATE OF TERMINATION. "Date of Termination," with respect to any
     purported termination of a Covered Employee's employment within twenty-four
     (24) months after a Change in Control, shall mean the date specified in the
     Notice of Termination. In the case of a termination by the Employers other
     than a termination for Cause (which may be effective immediately), the Date
     of Termination shall not be less than 30 days after the Notice of
     Termination is given. In the case of a termination by a Covered Employee,
     the Date of Termination shall not be less than 15 days from the date such
     Notice of Termination is given. Notwithstanding Section 3(a) of this Plan,
     in the event that a Covered Employee gives a Notice of Termination to the
     Employers, the Employers may unilaterally accelerate the Date of
     Termination and such acceleration shall not result in a second Terminating
     Event for purposes of Section 3(a) of this Plan.

          (c)  NO MITIGATION. The Covered Employee is not required to seek other
     employment or to attempt in any way to reduce any amounts payable to the
     Covered Employee by the Employers under this Plan. Further, the amount of
     any payment provided for in this Plan shall not be reduced by any
     compensation earned by the Covered Employee as the result of employment by
     another employer, by retirement benefits, by offset against any amount
     claimed to be owed by the Covered Employee to the Employers, or otherwise.

          (d)  MEDIATION OF DISPUTES. The parties shall endeavor in good faith
     to settle within 90 days any controversy or claim arising out of or
     relating to this Plan or the breach thereof through mediation with JAMS,
     Endispute or similar organizations. If the controversy or claim is not
     resolved within 90 days, the parties shall be free to pursue other legal
     remedies in law or equity.

     8.   BENEFITS AND BURDENS. This Plan shall inure to the benefit of and be
binding upon the Employers and the Covered Employees, their respective
successors, executors, administrators, heirs and permitted assigns. In the event
of a Covered Employee's death after a Terminating Event but prior to the
completion by the Employers of all payments due him under this Plan, the
Employers shall continue such payments to the Covered Employee's beneficiary
designated in writing to the Employers prior to his death (or to his estate, if
the Covered Employee fails to make such designation).

     9.   ENFORCEABILITY. If any portion or provision of this Plan shall to any
extent be declared illegal or unenforceable by a court of competent
jurisdiction, then the remainder of this Plan, or the application of such
portion or provision in circumstances other than those as to which it is so
declared illegal or unenforceable, shall not be affected thereby, and each
portion and provision of this Plan shall be valid and enforceable to the fullest
extent permitted by law.

     10.  WAIVER. No waiver of any provision hereof shall be effective unless
made in writing and signed by the waiving party. The failure of any party to
require the performance of any term or obligation of this Plan, or the waiver by
any party of any breach of this Plan, shall

                                        8


not prevent any subsequent enforcement of such term or obligation or be deemed a
waiver of any subsequent breach.

     11.  NOTICES. Any notices, requests, demands, and other communications
provided for by this Plan shall be sufficient if in writing and delivered in
person or sent by registered or certified mail, postage prepaid, to a Covered
Employee at the last address the Covered Employee has filed in writing with the
Employers, or to the Employers at their main office, attention of the Board of
Directors.

     12.  EFFECT ON OTHER PLANS. Nothing in this Plan shall be construed to
limit the rights of the Covered Employees under the Employers' benefit plans,
programs or policies.

     13.  AMENDMENT OR TERMINATION OF PLAN. The Company may amend or terminate
this Plan at any time or from time to time; provided, however, that no such
amendment shall, without the consent of the Covered Employees, in any material
adverse way affect the rights of the Covered Employees, and no termination shall
be made without the written consent of the Covered Employees.

     14.  GOVERNING LAW. This Plan shall be construed under and be governed in
all respects by the laws of the Commonwealth of Massachusetts.

     15.  OBLIGATIONS OF SUCCESSORS. In addition to any obligations imposed by
law upon any successor to the Employers, the Employers will use their best
efforts to require any successor (whether direct or indirect, by purchase,
merger, consolidation or otherwise) to all or substantially all of the business
or assets of the Employers to expressly assume and agree to perform this Plan in
the same manner and to the same extent that the Employers would be required to
perform if no such succession had taken place.


Adopted: As of July 30, 1998

                                        9



                                                                   EXHIBIT 10.20

                             BOSTON PROPERTIES, INC.

                            EXECUTIVE SEVERANCE PLAN


     1.   PURPOSE. Boston Properties, Inc. (the "Company") considers it
essential to the best interests of its stockholders to foster the continuous
employment of key management personnel. The Board of Directors of the Company
(the "Board") recognizes, however, that, as is the case with many publicly held
corporations, the possibility of a Change in Control (as defined in Section 2
hereof) exists and that such possibility, and the uncertainty and questions
which it may raise among management, may result in the departure or distraction
of management personnel to the detriment of the Company and its stockholders.
Therefore, the Board has determined that the Boston Properties, Inc. Executive
Severance Plan (the "Plan") should be adopted to reinforce and encourage the
continued attention and dedication of the Senior Vice-Presidents of the Company
and the Vice Presidents with ten (10) or more years of service with the Company
(each, a "Covered Employee"; collectively, the "Covered Employees"), to their
assigned duties without distraction in the face of potentially disturbing
circumstances arising from the possibility of a Change in Control. Nothing in
this Plan shall be construed as creating an express or implied contract of
employment and, except as otherwise agreed in writing between the Covered
Employee and the Company or any of its subsidiaries or affiliates (together with
the Company, the "Employers"), the Covered Employee shall not have any right to
be retained in the employ of the Employers.

     2.   CHANGE IN CONTROL. For purposes of this Plan, a "Change in Control"
shall mean the occurrence of any one of the following events:

          (a)  any "PERSON," as such term is used in Sections 13(d) and 14(d) of
     the Act (other than any of the Employers, Mortimer B. Zuckerman, Edward H.
     Linde, any "AFFILIATE" or "ASSOCIATE" (as such terms are defined in Rule
     12b-2 under the Act) of Mortimer B. Zuckerman or Edward H. Linde, or any
     trustee, fiduciary or other person or entity holding securities under any
     employee benefit plan or trust of any of the Employers), together with all
     "AFFILIATES" and "ASSOCIATES" (as such terms are defined in Rule 12b-2
     under the Act) of such person, shall become the "BENEFICIAL OWNER" (as such
     term is defined in Rule 13d-3 under the Act), directly or indirectly, of
     securities of the Company representing 25 percent or more of the combined
     voting power of the Company's then outstanding securities having the right
     to vote in an election of the Company's Board of Directors ("Voting
     Securities") (other than as a result of an acquisition of securities
     directly from the Company); provided that for purposes of determining the
     "BENEFICIAL OWNERSHIP" (as such term is defined in Rule 13d-3 under the
     Act) of any "GROUP" of which Mortimer B. Zuckerman, Edward H. Linde or any
     of their affiliates or associates is a member (each such entity or
     individual, a "Related Party"), there shall not be attributed to the
     "BENEFICIAL OWNERSHIP" (as such term is defined in Rule 13d-3 under the
     Act) of such group any shares beneficially owned by any Related Party; or



          (b)  persons who, as of the effective date of the Company's initial
     public offering of Stock, constitute the Company's Board of Directors (the
     "Incumbent Directors") cease for any reason, including, without limitation,
     as a result of a tender offer, proxy contest, merger or similar
     transaction, to constitute at least a majority of the Board, provided that
     any person becoming a director of the Company subsequent to such date shall
     be considered an Incumbent Director if such person's election was approved
     by or such person was nominated for election by either (A) a vote of at
     least two-thirds of the Incumbent Directors or (B) a vote of at least a
     majority of the Incumbent Directors who are members of a nominating
     committee comprised, in the majority, of Incumbent Directors; or

          (c)  the stockholders of the Company shall approve (A) any
     consolidation or merger of the Company where the stockholders of the
     Company, immediately prior to the consolidation or merger, would not,
     immediately after the consolidation or merger, "BENEFICIALLY OWN" (as such
     term is defined in Rule 13d-3 under the Act), directly or indirectly,
     shares representing in the aggregate 60 percent or more of the voting
     shares of the corporation issuing cash or securities in the consolidation
     or merger (or of its ultimate parent corporation, if any), (B) any sale,
     lease, exchange or other transfer to an unrelated party (in one transaction
     or a series of transactions contemplated or arranged by any party as a
     single plan) of all or substantially all of the assets of the Company or
     (C) any plan or proposal for the liquidation or dissolution of the Company.

     Notwithstanding the foregoing, a "Change of Control" shall not be deemed to
have occurred for purposes of the foregoing clause (a) solely as the result of
an acquisition of securities by the Company which, by reducing the number of
shares of Voting Securities outstanding, increases the proportionate number of
shares of Voting Securities beneficially owned by any person (as defined in the
foregoing clause (a)) to 25 percent or more of the combined voting power of all
then outstanding Voting Securities; PROVIDED, HOWEVER, that if such person shall
thereafter become the beneficial owner of any additional shares of Voting
Securities (other than pursuant to a stock split, stock dividend, or similar
transaction or as a result of an acquisition of securities directly from the
Company), then a "CHANGE OF CONTROL" shall be deemed to have occurred for
purposes of the foregoing clause (a).

     3.   TERMINATING EVENT. A "Terminating Event" shall mean the termination of
employment of a Covered Employee in connection with any of the events provided
in this Section 3 occurring within twelve (12) months following a Change in
Control:

          (a)  termination by the Employers of the employment of the Covered
     Employee with the Employers for any reason other than for Cause or the
     death or disability (as determined under the Employers' then existing
     long-term disability coverage) of such Covered Employee. "Cause" shall
     mean, and shall be limited to, the occurrence of any one or more of the
     following events:

               (i)   a willful act of dishonesty by the Covered Employee with
          respect to any matter involving any of the Employers; or

                                        2


               (ii)  conviction of the Covered Employee of a crime involving
          moral turpitude; or

               (iii) the deliberate or willful failure by the Covered Employee
          (other than by reason of the Covered Employee's physical or mental
          illness, incapacity or disability) to substantially perform the
          Covered Employee's duties with the Employers and the continuation of
          such failure for a period of 30 days after delivery by the Employers
          to the Covered Employee of written notice specifying the scope and
          nature of such failure and their intention to terminate the Covered
          Employee for Cause.

          A Terminating Event shall not be deemed to have occurred pursuant to
     this Section 3(a) solely as a result of the Covered Employee being an
     employee of any direct or indirect successor to the business or assets of
     either of the Employers, rather than continuing as an employee of the
     Employers following a Change in Control. For purposes of clauses (i) and
     (iii) of this Section 3(a), no act, or failure to act, on the Covered
     Employee's part shall be deemed "willful" unless done, or omitted to be
     done, by the Covered Employee without reasonable belief that the Covered
     Employee's act, or failure to act, was in the best interest of the
     Employers; or

          (b)  termination by the Covered Employee of the Covered Employee's
     employment with the Employers for Good Reason. "Good Reason" shall mean the
     occurrence of any of the following events:

               (i)   a substantial adverse change in the nature or scope of the
          Covered Employee's responsibilities, authorities, title, powers,
          functions, or duties from the responsibilities, authorities, powers,
          functions, or duties exercised by the Covered Employee immediately
          prior to the Change in Control; or

               (ii)  a reduction in the Covered Employee's annual base salary as
          in effect on the date hereof or as the same may be increased from time
          to time except for across-the-board salary reductions similarly
          affecting all or substantially all management employees; or

               (iii) the relocation of the Employers' offices at which the
          Covered Employee is principally employed immediately prior to the date
          of a Change in Control to a location more than thirty (30) miles from
          such offices, or the requirement by the Employers for the Covered
          Employee to be based anywhere other than the Employers' offices at
          such location, except for required travel on the Employers' business
          to an extent substantially consistent with the Covered Employee's
          business travel obligations immediately prior to the Change in
          Control; or

               (iv)  the failure by the Employers to pay to the Covered Employee
          any portion of his compensation or to pay to the Covered Employee any
          portion of an

                                        3


          installment of deferred compensation under any deferred compensation
          program of the Employers within fifteen (15) days of the date such
          compensation is due without prior written consent of the Covered
          Employee; or

               (v)   the failure by the Employers to obtain an effective
          agreement from any successor to assume and agree to perform this
          Agreement.

     4.   SPECIAL TERMINATION BENEFITS. In the event a Terminating Event occurs
within twelve (12) months after a Change in Control with respect to a Covered
Employee,

          (a)  the Employers shall pay to the Covered Employee an amount equal
     to the sum of the following:

               (i)   two (2) times the amount of the current annual base salary
          of the Covered Employee, determined prior to any reductions for
          pre-tax contributions to a cash or deferred arrangement or a cafeteria
          plan; and

               (ii)  two (2) times the amount of the average annual bonus earned
          by the Covered Employee with respect to the three (3) calendar years
          immediately prior to the Change in Control.

     Said amount shall be paid in one lump sum payment no later than thirty-one
     (31) days following the Date of Termination (as such term is defined in
     Section 7(b)); and

          (b)  the Employers shall continue to provide health, dental and life
     insurance to the Covered Employee, on the same terms and conditions as
     though the Covered Employee had remained an active employee, for
     twenty-four (24) months after the Terminating Event; and

          (c)  the Employers shall provide COBRA benefits to the Covered
     Employee following the end of the period referred to in Section 4(b) above,
     such benefits to be determined as though the Covered Employee's employment
     had terminated at the end of such period; and

          (d)  the Employers shall pay to the Covered Employee all reasonable
     legal and mediation fees and expenses incurred by the Covered Employee in
     obtaining or enforcing any right or benefit provided by this Plan, except
     in cases involving frivolous or bad faith litigation initiated by the
     Covered Employee; and

          (e)  the Employers shall provide to the Covered Employee financial
     counseling, tax preparation assistance and outplacement counseling for
     twenty-four (24) months after the Terminating Event.

     Notwithstanding the foregoing, the special termination benefits required by
Section 4(a) shall be offset by any amount paid or payable to the Covered
Employee by the Employers under the terms of any employment agreement or other
plan.

                                        4


     5.  ADDITIONAL BENEFITS.

          (a)  Anything in this Plan to the contrary notwithstanding, in the
     event it shall be determined that any compensation payment or distribution
     by the Employers to or for the benefit of the Covered Employee, whether
     paid or payable or distributed or distributable pursuant to the terms of
     this Plan or otherwise (the "Severance Payments"), would be subject to the
     excise tax imposed by Section 4999 of the Internal Revenue Code of 1986, as
     amended (the "Code"), or any interest or penalties are incurred by the
     Covered Employee with respect to such excise tax (such excise tax, together
     with any such interest and penalties, are hereinafter collectively referred
     to as the "Excise Tax"), then the Covered Employee shall be entitled to
     receive an additional payment (a "Gross-Up Payment") such that the net
     amount retained by the Covered Employee, after deduction of any Excise Tax
     on the Severance Payments, any Federal, state, and local income tax,
     employment tax and Excise Tax upon the payment provided by this subsection,
     and any interest and/or penalties assessed with respect to such Excise Tax
     and not after the deduction of any other taxes or amounts, shall be equal
     to the Severance Payments. (The Gross-Up Payment is not intended to
     compensate the Covered Employee for any income taxes payable with respect
     to the Severance Payments.)

          (b)  Subject to the provisions of Section 5(c), all determinations
     required to be made under this Section 5, including whether a Gross-Up
     Payment is required and the amount of such Gross-Up Payment, shall be made
     by Coopers & Lybrand, L.L.P. or any other nationally recognized accounting
     firm selected by the Employers (the "Accounting Firm"), which shall provide
     detailed supporting calculations both to the Employers and the Covered
     Employee within 15 business days of the Date of Termination, if applicable,
     or at such earlier time as is reasonably requested by the Employers or the
     Covered Employee. For purposes of determining the amount of the Gross-Up
     Payment, the Covered Employee shall be deemed to pay federal income taxes
     at the highest marginal rate of federal income taxation applicable to
     individuals for the calendar year in which the Gross-Up Payment is to be
     made, and state and local income taxes at the highest marginal rates of
     individual taxation in the state and locality of the Covered Employee's
     residence on the Date of Termination, net of the maximum reduction in
     federal income taxes which could be obtained from deduction of such state
     and local taxes. The initial Gross-Up Payment, if any, as determined
     pursuant to this Section 5(b), shall be paid to the Covered Employee within
     five days of the receipt of the Accounting Firm's determination. If the
     Accounting Firm determines that no Excise Tax is payable by the Covered
     Employee, the Employers shall furnish the Covered Employee with an opinion
     of counsel that failure to report the Excise Tax on the Covered Employee's
     applicable federal income tax return would not result in the imposition of
     a negligence or similar penalty. Any determination by the Accounting Firm
     shall be binding upon the Employers and the Covered Employee. As a result
     of the uncertainty in the application of Section 4999 of the Code at the
     time of the initial determination by the Accounting Firm hereunder, it is
     possible that Gross-Up Payments which will not have been made by the
     Employers should have been made (an "Underpayment"). In the event that the
     Employers exhaust their remedies pursuant to Section 5(c) and the Covered
     Employee thereafter is required to make a payment of any Excise Tax, the
     Accounting Firm shall

                                        5


     determine the amount of the Underpayment that has occurred, consistent with
     the calculations required to be made hereunder, and any such Underpayment,
     and any interest and penalties imposed on the Underpayment and required to
     be paid by the Covered Employee in connection with the proceedings
     described in Section 5(c), shall be promptly paid by the Employers to or
     for the benefit of the Covered Employee.

          (c)  The Covered Employee shall notify the Employers in writing of any
     claim by the Internal Revenue Service that, if successful, would require
     the payment by the Employers of the Gross-Up Payment. Such notification
     shall be given as soon as practicable but no later than 10 business days
     after the Covered Employee knows of such claim and shall apprise the
     Employers of the nature of such claim and the date on which such claim is
     requested to be paid. The Covered Employee shall not pay such claim prior
     to the expiration of the 30-day period following the date on which he gives
     such notice to the Employers (or such shorter period ending on the date
     that any payment of taxes with respect to such claim is due). If the
     Employers notify the Covered Employee in writing prior to the expiration of
     such period that they desire to contest such claim, provided that the
     Employers have set aside adequate reserves to cover the Underpayment and
     any interest and penalties thereon that may accrue, the Covered Employee
     shall:

               (i)   give the Employers any information reasonably requested by
          the Employers relating to such claim,

               (ii)  take such action in connection with contesting such claim
          as the Employers shall reasonably request in writing from time to
          time, including, without limitation, accepting legal representation
          with respect to such claim by an attorney selected by the Employers,

               (iii) cooperate with the Employers in good faith in order
          effectively to contest such claim, and

               (iv)  permit the Employers to participate in any proceedings
          relating to such claim; provided, however, that the Employers shall
          bear and pay directly all costs and expenses (including additional
          interest and penalties) incurred in connection with such contest and
          shall indemnify and hold the Covered Employee harmless, on an
          after-tax basis, for any Excise Tax or income tax, including interest
          and penalties with respect thereto, imposed as a result of such
          representation and payment of costs and expenses. Without limitation
          on the foregoing provisions of this Section 5(c), the Employers shall
          control all proceedings taken in connection with such contest and, at
          their sole option, may pursue or forego any and all administrative
          appeals, proceedings, hearings and conferences with the taxing
          authority in respect of such claim and may, at their sole option,
          either direct the Covered Employee to pay the tax claimed and sue for
          a refund or contest the claim in any permissible manner, and the
          Covered Employee agrees to prosecute such contest to a determination
          before any administrative tribunal, in a court of initial jurisdiction
          and in one or more appellate courts, as the Employers shall determine;
          provided, however, that if the

                                        6


          Employers direct the Covered Employee to pay such claim and sue for a
          refund, the Employers shall advance the amount of such payment to the
          Covered Employee on an interest-free basis and shall indemnify and
          hold the Covered Employee harmless, on an after-tax basis, from any
          Excise Tax or income tax, including interest or penalties with respect
          thereto, imposed with respect to such advance or with respect to any
          imputed income with respect to such advance; and further provided that
          any extension of the statute of limitations relating to payment of
          taxes for the taxable year of the Covered Employee with respect to
          which such contested amount is claimed to be due is limited solely to
          such contested amount. Furthermore, the Employers' control of the
          contest shall be limited to issues with respect to which a Gross-Up
          Payment would be payable hereunder and the Covered Employee shall be
          entitled to settle or contest, as the case may be, any other issues
          raised by the Internal Revenue Service or any other taxing authority.

          (d)  If, after the receipt by the Covered Employee of an amount
     advanced by the Employers pursuant to Section 5(c), the Covered Employee
     becomes entitled to receive any refund with respect to such claim, the
     Covered Employee shall (subject to the Employers' complying with the
     requirements of Section 5(c)) promptly pay to the Employers the amount of
     such refund (together with any interest paid or credited thereon after
     taxes applicable thereto). If, after the receipt by the Covered Employee of
     an amount advanced by the Employers pursuant to Section 5(c), a
     determination is made that the Covered Employee shall not be entitled to
     any refund with respect to such claim and the Employers do not notify the
     Covered Employee in writing of their intent to contest such denial of
     refund prior to the expiration of 30 days after such determination, then
     such advance shall be forgiven and shall not be required to be repaid and
     the amount of such advance shall offset, to the extent thereof, the amount
     of Gross-Up Payment required to be paid.

     6.   WITHHOLDING. All payments made by the Employers under this Plan shall
be net of any tax or other amounts required to be withheld by the Employers
under applicable law.

     7.   NOTICE AND DATE OF TERMINATION; DISPUTES; ETC.

          (a)  NOTICE OF TERMINATION. Within twelve (12) months after a Change
     in Control, any purported termination of a Covered Employee's employment
     (other than by reason of death) shall be communicated by written Notice of
     Termination from the Employers to the Covered Employee or vice versa in
     accordance with this Section 7. For purposes of this Plan, a "Notice of
     Termination" shall mean a notice which shall indicate the specific
     termination provision in this Plan relied upon and the Date of Termination.
     Further, a Notice of Termination for Cause is required to include a copy of
     a resolution duly adopted by the affirmative vote of not less than
     two-thirds (2/3) of the entire membership of the Board at a meeting of the
     Board (after reasonable notice to the Covered Employee and an opportunity
     for the Covered Employee, accompanied by the Covered Employee's counsel, to
     be heard before the Board) finding that, in the good faith opinion of the
     Board, the termination met the criteria for Cause set forth in Section 3(a)
     hereof.

                                        7


          (b)  DATE OF TERMINATION. "Date of Termination," with respect to any
     purported termination of a Covered Employee's employment within twelve (12)
     months after a Change in Control, shall mean the date specified in the
     Notice of Termination. In the case of a termination by the Employers other
     than a termination for Cause (which may be effective immediately), the Date
     of Termination shall not be less than 30 days after the Notice of
     Termination is given. In the case of a termination by a Covered Employee,
     the Date of Termination shall not be less than 15 days from the date such
     Notice of Termination is given. Notwithstanding Section 3(a) of this Plan,
     in the event that a Covered Employee gives a Notice of Termination to the
     Employers, the Employers may unilaterally accelerate the Date of
     Termination and such acceleration shall not result in a second Terminating
     Event for purposes of Section 3(a) of this Plan.

          (c)  NO MITIGATION. The Covered Employee is not required to seek other
     employment or to attempt in any way to reduce any amounts payable to the
     Covered Employee by the Employers under this Plan. Further, the amount of
     any payment provided for in this Plan shall not be reduced by any
     compensation earned by the Covered Employee as the result of employment by
     another employer, by retirement benefits, by offset against any amount
     claimed to be owed by the Covered Employee to the Employers, or otherwise.

          (d)  MEDIATION OF DISPUTES. The parties shall endeavor in good faith
     to settle within 90 days any controversy or claim arising out of or
     relating to this Plan or the breach thereof through mediation with JAMS,
     Endispute or similar organizations. If the controversy or claim is not
     resolved within 90 days, the parties shall be free to pursue other legal
     remedies in law or equity.

     8.   BENEFITS AND BURDENS. This Plan shall inure to the benefit of and be
binding upon the Employers and the Covered Employees, their respective
successors, executors, administrators, heirs and permitted assigns. In the event
of a Covered Employee's death after a Terminating Event but prior to the
completion by the Employers of all payments due him under this Plan, the
Employers shall continue such payments to the Covered Employee's beneficiary
designated in writing to the Employers prior to his death (or to his estate, if
the Covered Employee fails to make such designation).

     9.   ENFORCEABILITY. If any portion or provision of this Plan shall to any
extent be declared illegal or unenforceable by a court of competent
jurisdiction, then the remainder of this Plan, or the application of such
portion or provision in circumstances other than those as to which it is so
declared illegal or unenforceable, shall not be affected thereby, and each
portion and provision of this Plan shall be valid and enforceable to the fullest
extent permitted by law.

     10.  WAIVER. No waiver of any provision hereof shall be effective unless
made in writing and signed by the waiving party. The failure of any party to
require the performance of any term or obligation of this Plan, or the waiver by
any party of any breach of this Plan, shall not prevent any subsequent
enforcement of such term or obligation or be deemed a waiver of any subsequent
breach.

                                        8


     11.  NOTICES. Any notices, requests, demands, and other communications
provided for by this Plan shall be sufficient if in writing and delivered in
person or sent by registered or certified mail, postage prepaid, to a Covered
Employee at the last address the Covered Employee has filed in writing with the
Employers, or to the Employers at their main office, attention of the Board of
Directors.

     12.  EFFECT ON OTHER PLANS. Nothing in this Plan shall be construed to
limit the rights of the Covered Employees under the Employers' benefit plans,
programs or policies.

     13.  AMENDMENT OR TERMINATION OF PLAN. The Company may amend or terminate
this Plan at any time or from time to time; provided, however, that no such
amendment shall, without the consent of the Covered Employees, in any material
adverse way affect the rights of the Covered Employees, and no termination shall
be made without the written consent of the Covered Employees.

     14.  GOVERNING LAW. This Plan shall be construed under and be governed in
all respects by the laws of the Commonwealth of Massachusetts.

     15.  OBLIGATIONS OF SUCCESSORS. In addition to any obligations imposed by
law upon any successor to the Employers, the Employers will use their best
efforts to require any successor (whether direct or indirect, by purchase,
merger, consolidation or otherwise) to all or substantially all of the business
or assets of the Employers to expressly assume and agree to perform this Plan in
the same manner and to the same extent that the Employers would be required to
perform if no such succession had taken place.

Adopted: As of July 30, 1998

                                        9



                                                                   EXHIBIT 10.23

              THIRD AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT

                                      among

                      BOSTON PROPERTIES LIMITED PARTNERSHIP

                                       and

           OTHER BORROWERS WHICH MAY BECOME PARTIES TO THIS AGREEMENT

                                       and

                               FLEET NATIONAL BANK
                              BANK OF AMERICA, N.A.
                COMMERZBANK AG NEW YORK AND GRAND CAYMAN BRANCHES
                               JPMORGAN CHASE BANK
                      WELLS FARGO BANK NATIONAL ASSOCIATION
                         PNC BANK, NATIONAL ASSOCIATION
                              THE BANK OF NEW YORK
                          CITICORP NORTH AMERICA, INC.
               BAYERISCHE HYPO-UND VEREINSBANK AG, NEW YORK BRANCH
                      DEUTSCHE BANK TRUST COMPANY AMERICAS
                                  KEYBANK, N.A.
              DRESDNER BANK AG, NEW YORK AND GRAND CAYMAN BRANCHES
                                  CITIZENS BANK

                                       and

        OTHER BANKS WHICH MAY BECOME PARTIES TO THIS AGREEMENT, AS BANKS

                                       and

                              FLEET NATIONAL BANK,
                        AS MANAGING ADMINISTRATIVE AGENT

                             BANK OF AMERICA, N.A.,
                              AS SYNDICATION AGENT

                                       and

                COMMERZBANK AG NEW YORK AND GRAND CAYMAN BRANCHES
                               JPMORGAN CHASE BANK
                                       and
                     WELLS FARGO BANK NATIONAL ASSOCIATION,
                           AS CO-DOCUMENTATION AGENTS

                                      with

           FLEET SECURITIES, INC. AND BANC OF AMERICA SECURITIES LLC,
              ACTING AS JOINT LEAD ARRANGERS AND JOINT BOOKRUNNERS

                          Dated as of January 17, 2003



                                TABLE OF CONTENTS



Section                                                                              Page
- -------                                                                              ----
                                                                                    
Section 1.    DEFINITIONS AND RULES OF INTERPRETATION                                   2

   Section 1.1.     Definitions                                                         2

   Section 1.2.     Rules of Interpretation                                            31

Section 2.    THE REVOLVING CREDIT FACILITY                                            31

   Section 2.1.     Commitment to Lend                                                 31

   Section 2.2.     The Revolving Credit Notes                                         33

   Section 2.3.     Interest on Revolving Credit Loans; Fees                           33

   Section 2.4.     Requests for Revolving Credit Loans                                34

   Section 2.5.     Conversion Options                                                 36

   Section 2.6.     Funds for Revolving Credit Loans                                   37

   Section 2.7.     Reduction of Commitment                                            38

   Section 2.8.     Swingline Loans                                                    38

   Section 2.9.     Bid Rate Advances                                                  41

   Section 2.10.    Increases in Total Commitment                                      45

   Section 2.11.    Extension of Revolving Credit Maturity Date                        46

Section 3.    LETTERS OF CREDIT                                                        46

   Section 3.1.     Letter of Credit Commitments                                       46

   Section 3.1.1.   Commitment to Issue Letters of Credit                              46

   Section 3.1.2.   Letter of Credit Applications                                      46


                                       -i-



                                                                                    
   Section 3.1.3.   Terms of Letters of Credit                                         47

   Section 3.1.4.   Obligations of Banks with respect to Letters of Credit             47

   Section 3.1.5.   Fronting Bank                                                      47

   Section 3.2.     Reimbursement Obligation of the Borrower                           47

   Section 3.3.     Letter of Credit Payments; Funding of a Loan                       48

   Section 3.4.     Obligations Absolute                                               49

   Section 3.5.     Reliance by Issuer                                                 49

   Section 3.6.     Letter of Credit Fee                                               50

Section 4.    REPAYMENT OF THE REVOLVING CREDIT LOANS                                  50

   Section 4.1.     Maturity                                                           50

   Section 4.2.     Optional Repayments of Revolving Credit Loans                      50

   Section 4.3.     Mandatory Repayment of Loans                                       51

Section 5.    CERTAIN GENERAL PROVISIONS                                               51

   Section 5.1.     Funds for Payments                                                 51

   Section 5.2.     Computations                                                       52

   Section 5.3.     Inability to Determine Eurodollar Rate                             52

   Section 5.4.     Illegality                                                         52

   Section 5.5.     Additional Costs, Etc.                                             53

   Section 5.6.     Capital Adequacy                                                   54

   Section 5.7.     Certificate; Limitations                                           55

   Section 5.8.     Indemnity                                                          55

   Section 5.9.     Interest on Overdue Amounts                                        55

Section 6.    RECOURSE OBLIGATIONS                                                     56


                                      -ii-



                                                                                    
Section 7.    REPRESENTATIONS AND WARRANTIES                                           56

   Section 7.1.     Authority, Etc.                                                    56

   Section 7.2.     Governmental Approvals                                             58

   Section 7.3.     Title to Properties; Leases                                        58

   Section 7.4.     Financial Statements                                               59

   Section 7.5.     No Material Changes, Etc.                                          59

   Section 7.6.     Franchises, Patents, Copyrights, Etc.                              59

   Section 7.7.     Litigation                                                         60

   Section 7.8.     No Materially Adverse Contracts, Etc.                              60

   Section 7.9.     Compliance With Other Instruments, Laws, Etc.                      60

   Section 7.10.    Tax Status                                                         60

   Section 7.11     No Event of Default                                                61

   Section 7.12.    Investment Company Acts                                            61

   Section 7.13.    Absence of UCC Financing Statements, Etc.                          61

   Section 7.14.    Absence of Liens                                                   61

   Section 7.15.    Certain Transactions                                               61

   Section 7.16.    Employee Benefit Plans; Multiemployer Plans; Guaranteed
Pension Plans                                                                          61

   Section 7.17.    Regulations U and X                                                61

   Section 7.18.    Environmental Compliance                                           61

   Section 7.19.    Subsidiaries                                                       63

   Section 7.20.    Loan Documents                                                     63

   Section 7.21.    REIT Status                                                        64

Section 8.    AFFIRMATIVE COVENANTS OF THE BORROWER AND BPI                            64


                                      -iii-



                                                                                    
   Section 8.1.     Punctual Payment                                                   64

   Section 8.2.     Maintenance of Office                                              64

   Section 8.3.     Records and Accounts                                               64

   Section 8.4.     Financial Statements, Certificates and Information                 64

   Section 8.5.     Notices                                                            67

   Section 8.6.     Existence of Borrower;  Maintenance of Properties                  69

   Section 8.7.     Existence of BPI; Maintenance of REIT Status of BPI;
Maintenance of Properties                                                              70

   Section 8.8.     Insurance                                                          70

   Section 8.9.     Taxes                                                              71

   Section 8.10.    Inspection of Properties and Books                                 71

   Section 8.11.    Compliance with Laws, Contracts, Licenses, and Permits             73

   Section 8.12.    Use of Proceeds                                                    73

   Section 8.13.    Addition of Borrowing Base Property                                74

   Section 8.14.    Additional Borrowers; Solvency of Borrowers; Removal of
                    Borrowers                                                          74

   Section 8.15.    Further Assurances                                                 75

   Section 8.16.    Interest Rate Protection                                           75

   Section 8.17.    Environmental Indemnification                                      75

   Section 8.18.    Response Actions                                                   76

   Section 8.19.    Environmental Assessments                                          76

   Section 8.20.    Employee Benefit Plans                                             77

   Section 8.21.    No Amendments to Certain Documents                                 77

Section 9.    CERTAIN NEGATIVE COVENANTS OF THE BORROWER AND BPI                       78

   Section 9.1.     Restrictions on Liabilities                                        78


                                      -iv-



                                                                                    
   Section 9.2.     Restrictions on Liens, Etc.                                        79

   Section 9.3.     Restrictions on Investments                                        81

   Section 9.4.     Merger, Consolidation and Disposition of Assets; Assets of BPI     83

   Section 9.5.     Compliance with Environmental Laws                                 84

   Section 9.6.     Distributions                                                      84

   Section 9.7.     Hotel Properties                                                   84

Section 10.   FINANCIAL COVENANTS; COVENANTS REGARDING BORROWING BASE PROPERTIES       85

   Section 10.1.    Consolidated Total Indebtedness                                    85

   Section 10.2.    Secured Consolidated Total Indebtedness                            85

   Section 10.3.    Debt Service Coverage                                              85

   Section 10.4.    Reserved                                                           85

   Section 10.5.    Net Worth                                                          86

   Section 10.6.    Borrowing Base Properties                                          86

   Section 10.7.    Borrowing Base Debt Service Coverage Ratio                         87

Section 11.   [RESERVED.]                                                              87

Section 12.   CONDITIONS TO THE FIRST ADVANCE                                          87

   Section 12.1.    Loan Documents                                                     87

   Section 12.2.    Certified Copies of Organization Documents                         87

   Section 12.3.    By-laws; Resolutions                                               88

   Section 12.4.    Incumbency Certificate: Authorized Signers                         88

   Section 12.5.    Title Policies                                                     88

   Section 12.6.    Certificates of Insurance                                          88


                                       -v-



                                                                                    
   Section 12.7.    Hazardous Substance Assessments                                    88

   Section 12.8.    Opinion of Counsel Concerning Organization and Loan Documents      88

Section 12.9. [RESERVED.]                                                              89

   Section 12.10.   Structural Condition Assurances                                    89

   Section 12.11.   Financial Analysis of Borrowing Base Properties                    89

   Section 12.12.   Inspection of Borrowing Base Properties                            89

   Section 12.13.   Certifications from Government Officials                           89

   Section 12.14.   [Reserved.]                                                        89

   Section 12.15.   Proceedings and Documents                                          89

   Section 12.16.   Fees                                                               90

   Section 12.17.   Closing Certificate; Compliance Certificate                        90

   Section 12.18.   Partnership Documents                                              90

   Section 12.19.   Release Documents                                                  90

Section 13.   CONDITIONS TO ALL BORROWINGS                                             90

   Section 13.1.    Representations True; No Event of Default; Compliance Certificate  90

   Section 13.2.    No Legal Impediment                                                91

   Section 13.3.    Governmental Regulation                                            91

Section 14.   EVENTS OF DEFAULT; ACCELERATION; ETC.                                    91

   Section 14.1.    Events of Default and Acceleration                                 91

   Section 14.2.    Termination of Commitments                                         96

   Section 14.3.    Remedies                                                           96

Section 15.   SETOFF                                                                   97


                                      -vi-



                                                                                   
Section 16.   THE AGENT                                                                97

   Section 16.1.    Authorization                                                      97

   Section 16.2.    Employees and Agents                                               97

   Section 16.3.    No Liability                                                       97

   Section 16.4.    No Representations                                                 98

   Section 16.5.    Payments                                                           98

   Section 16.6.    Holders of Revolving Credit Notes                                  99

   Section 16.7.    Indemnity                                                          99

   Section 16.8.    Agent as Bank                                                      99

   Section 16.9.    Notification of Defaults and Events of Default                     99

   Section 16.10.   Duties in the Case of Enforcement                                  99

   Section 16.11.   Successor Agent                                                   100

   Section 16.12.   Notices                                                           101

Section 17.   EXPENSES                                                                101

Section 18.   INDEMNIFICATION                                                         102

Section 19.   SURVIVAL OF COVENANTS, ETC.                                             102

Section 20.   ASSIGNMENT; PARTICIPATIONS; ETC.                                        103

   Section 20.1.    Conditions to Assignment by Banks.                                103

   Section 20.2.    Certain Representations and Warranties; Limitations; Covenants    104

   Section 20.3.    Register                                                          105

   Section 20.4.    New Notes                                                         105

   Section 20.5.    Participations                                                    105

   Section 20.6.    Pledge by Lender                                                  106


                                      -vii-



                                                                                   
   Section 20.7.    No Assignment by Borrower                                         106

   Section 20.8.    Disclosure                                                        106

   Section 20.9.    Syndication                                                       106

Section 21.   NOTICES, ETC.                                                           106

Section 22.   BPLP AS AGENT FOR THE BORROWER                                          107

Section 23.   GOVERNING LAW; CONSENT TO JURISDICTION AND SERVICE                      107

Section 24.   HEADINGS                                                                108

Section 25.   COUNTERPARTS                                                            108

Section 26.   ENTIRE AGREEMENT, ETC.                                                  108

Section 27.   WAIVER OF JURY TRIAL AND CERTAIN DAMAGE CLAIMS                          108

Section 28.   CONSENTS, AMENDMENTS, WAIVERS, ETC.                                     109

Section 29.   SEVERABILITY                                                            110

Section 30.   INTEREST RATE LIMITATION                                                111


                                     -viii-


        EXHIBITS TO THIRD AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT

A       Form of Revolving Credit Note
A-1     Form of Swingline Note
B       Form of Loan Request
C       Form of Compliance Certificate
D       Forms of Competitive Bid Documents
E       Form of Closing Certificate
F       Form of Assignment and Assumption Agreement
G       Form of Joinder Agreement

                                      -ix-


       SCHEDULES TO THIRD AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT

Schedule 1          Borrower
Schedule 2          Banks
Schedule 3          Borrowing Base Properties
Schedule 4          CBD Properties
Schedule 7.1(b)     Preferred Creditor Equity
Schedule 7.7        Litigation
Schedule 7.16       Employee Benefit Plans
Schedule 7.19       Subsidiaries
Schedule 8.5(b)     Environmental Events
Schedule 9.1(e)     BPI Liabilities
Schedule 9.3        Investments

                                       -x-


                           THIRD AMENDED AND RESTATED
                           REVOLVING CREDIT AGREEMENT

    This THIRD AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT is made as of the
17th day of January, 2003, by and among BOSTON PROPERTIES LIMITED PARTNERSHIP, a
Delaware limited partnership ("BPLP") and the Wholly-owned Subsidiaries (defined
below) which are listed on SCHEDULE 1 hereto (as such Schedule 1 may be amended
from time to time) (BPLP and any such Wholly-owned Subsidiary being hereinafter
referred to collectively as the "Borrower" unless referred to in their
individual capacities), having their principal place of business at 800 Boylston
Street, Boston, Massachusetts 02199; FLEET NATIONAL BANK ("Fleet"), having its
principal place of business at One Federal Street, Boston, Massachusetts 02109
and the other lending institutions listed on SCHEDULE 2 hereto or which may
become parties hereto pursuant to Section 20 (individually, a "Bank" and
collectively, the "Banks"); FLEET, as managing administrative agent for itself
and each other Bank; BANK OF AMERICA, N.A., as Syndication Agent, and
COMMERZBANK AG NEW YORK AND GRAND CAYMAN BRANCHES, JPMORGAN CHASE BANK and WELLS
FARGO BANK NATIONAL ASSOCIATION, as Co-Documentation Agents; and FLEET
SECURITIES, INC. and BANC OF AMERICA SECURITIES LLC, as Joint Lead Arrangers and
Joint Bookrunners.

                                    RECITALS

    A.    The Borrower, certain of its Subsidiaries and BankBoston, N.A. entered
into that certain Revolving Credit Agreement dated as of June 23, 1997 (as
amended, the "Initial Credit Agreement") and acted as agent thereunder.

    B.    The Initial Credit Agreement (i) was amended and restated in its
entirety as of March 31, 1998 pursuant to the Amended and Restated Revolving
Credit Agreement among the Borrower, certain of its Subsidiaries, BankBoston,
N.A., individually and as managing administrative agent, and certain other
financial institutions, including Fleet, and (ii) was further amended and
restated in its entirety again as of March 31, 2000 pursuant to the Second
Amended and Restated Revolving Credit Agreement among the Borrower, certain of
its Subsidiaries, Fleet (as successor to BankBoston, N.A.), individually and as
managing administrative agent, and certain other financial institutions (such
Second Amended and Restated Revolving Credit Agreement, as amended, the
"Existing Credit Agreement").

    C.    Effective March 1, 2000, Fleet National Bank was merged into
BankBoston, N.A. and simultaneously therewith, BankBoston, N.A. changed its name
to Fleet National Bank.

                                       -1-


    D.    The Borrower, Fleet and the other lenders and agents under the
Existing Credit Agreement desire to amend the Existing Credit Agreement in
certain respects as set forth herein (including, without limitation, to reflect
the withdrawal of certain of the Banks thereunder).

    E.    The Borrower is primarily engaged in the business of owning,
purchasing, developing, constructing, renovating and operating office and
industrial buildings and hotels in the United States.

    F.    Boston Properties, Inc., a Delaware corporation ("BPI"), is the sole
general partner of BPLP, holds in excess of 65% of the partnership interests in
BPLP as of the date of this Agreement, and is qualified to elect REIT status for
income tax purposes.

    G.    The Borrower has requested the Banks, and the Banks have agreed, to
amend and restate the existing unsecured revolving credit facility for use by
the Borrower pursuant to the terms and conditions hereof.

    NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, the parties hereto agree that the Existing Credit Agreement
shall be amended and restated effective as of January 17, 2003, to read as
follows:

    Section 1.     DEFINITIONS AND RULES OF INTERPRETATION.

    Section 1.1.   Definitions. The following terms shall have the meanings set
forth in this Section 1 or elsewhere in the provisions of this Agreement
referred to below:

    111 HUNTINGTON AVENUE. The property located at 111 Huntington Avenue,
Boston, Massachusetts. The Agent hereby acknowledges that, as of the date
hereof, 111 Huntington Avenue is a CBD Property.

    399 PARK AVENUE. The property located at 399 Park Avenue, New York, New
York. The Agent hereby acknowledges that, as of the date hereof, 399 Park Avenue
is a CBD Property.

    ABSOLUTE RATE AUCTION. With respect to a request by the Borrower for a Bid
Rate Advance, a solicitation in which the Borrower specifies in the Bid Rate
Advance Borrowing Notice that the rates of interest to be offered by the Banks
shall be absolute rates per annum.

    ACCOUNTANTS. In each case, independent certified public accountants
reasonably acceptable to the Majority Banks. The Banks hereby acknowledge that
the Accountants may include PriceWaterhouse Coopers LLP and any other so-called
"big-four" accounting firm.

                                       -2-


    ACCOUNTS PAYABLE. See definition of "Consolidated Total Indebtedness".

    ACCOUNTS RECEIVABLE. Collectively, without double-counting, each of the
accounts receivable of the Borrower and its Subsidiaries which (i) arose in the
ordinary course of business of the Borrower or such Subsidiary, (ii) would be
classified under GAAP as a current asset on the balance sheet of the Borrower or
such Subsidiary and is not more than 60 days past due under the original terms,
and (iii) to the knowledge of the Borrower or such Subsidiary, is the valid and
binding obligation of the account debtor.

    ADVANCE RATE. See definition of "Eligible Amount".

    AFFILIATE. With reference to any Person, (i) any director or executive
officer of that Person, (ii) any other Person controlling, controlled by or
under direct or indirect common control of that Person, (iii) any other Person
directly or indirectly holding 10% or more of any class of the capital stock or
other equity interests (including options, warrants, convertible securities and
similar rights) of that Person and (iv) any other Person 10% or more of any
class of whose capital stock or other equity interests (including options,
warrants, convertible securities and similar rights) is held directly or
indirectly by that Person.

    AGENT. Fleet acting as managing administrative agent for the Banks, or any
successor agent, as permitted by Section 16.

    AGENT'S HEAD OFFICE. The Agent's office located at One Federal Street,
Boston, Massachusetts 02109, or at such other location as the Agent may
designate from time to time, or the office of any successor Agent permitted
under Section 16, PROVIDED such office (which need not be such successor Agent's
head office) is located in Boston, Massachusetts.

    AGREEMENT. This Third Amended and Restated Revolving Credit Agreement,
including the SCHEDULES and Exhibits hereto, as the same may be from time to
time amended and in effect.

    AGREEMENT OF LIMITED PARTNERSHIP OF BPLP. The Amended and Restated Agreement
of Limited Partnership of BPLP, dated June 23, 1997, as amended, among BPI and
the limited partners named therein, as amended through the date hereof and as
the same may be further amended from time to time as permitted by Section 8.21.

    ANNUALIZED BORROWING BASE PROPERTIES CAPITAL EXPENDITURES. (i) With respect
to any Real Estate Assets which are Borrowing Base Properties, other than hotel
properties, for any rolling four (4) calendar quarters, determined as of the
last day of a calendar quarter, an amount equal to $.25 MULTIPLIED BY the total
number of square feet of the Real Estate Assets, which are Borrowing Base
Properties, other than hotel properties on the last day of such calendar
quarter; (ii) with respect to the Marriott Cambridge Center

                                       -3-


Hotel in Cambridge, Massachusetts for so long as it is a Borrowing Base
Property, for any rolling four (4) calendar quarters, determined as of the last
day of a calendar quarter, an amount equal to six percent (6%) of gross revenues
as determined in accordance with GAAP for such four (4) calendar quarters; (iii)
with respect to the Marriott Long Wharf Hotel in Boston, Massachusetts, for so
long as it is a Borrowing Base Property, for any rolling four (4) calendar
quarters, determined as of the last day of a calendar quarter, an amount equal
to five percent (5%) of gross revenues as determined in accordance with GAAP for
such four (4) calendar quarters; (iv) with respect to the Cambridge Residence
Inn in Cambridge, Massachusetts, for so long as it is a Borrowing Base Property,
for any rolling four (4) calendar quarters, determined as of the last day of a
calendar quarter, an amount equal to five percent (5%) of gross revenues as
determined in accordance with GAAP for such four (4) calendar quarters; and (v)
with respect to the hotel properties which are Borrowing Base Properties, other
than the Marriott Long Wharf Hotel, the Marriott Cambridge Center Hotel and the
Cambridge Residence Inn, for any rolling four (4) calendar quarters, determined
as of the last day of a calendar quarter, an amount equal to the applicable
percentage of gross revenues as determined in accordance with GAAP for such four
(4) calendar quarters, which is to be maintained on the books of the Borrower or
in a separate reserve account for the replacement or repair of such hotel's
furniture, fixtures and equipment pursuant to (and in no event less than as
required by) the applicable hotel management agreement or franchise agreement
(which such agreement shall be in form and substance customary for a national
hotel franchise).

    ANNUALIZED CAPITAL EXPENDITURES. (i) With respect to any Real Estate Assets
other than hotel properties, for any rolling four (4) calendar quarters,
determined as of the last day of a calendar quarter, an amount equal to $.25
MULTIPLIED BY the total number of square feet of the Real Estate Assets other
than hotel properties, on the last day of such calendar quarter; (ii) with
respect to the Marriott Cambridge Center Hotel in Cambridge, Massachusetts, for
any rolling four (4) calendar quarters, determined as of the last day of a
calendar quarter, an amount equal to six percent (6%) of gross revenues as
determined in accordance with GAAP for such four (4) calendar quarters; (iii)
with respect to the Marriott Long Wharf Hotel in Boston, Massachusetts, for any
rolling four (4) calendar quarters, determined as of the last day of a calendar
quarter, an amount equal to five percent (5%) of gross revenues as determined in
accordance with GAAP for such four (4) calendar quarters; (iv) with respect to
the Cambridge Residence Inn in Cambridge, Massachusetts, for any rolling four
(4) calendar quarters, determined as of the last day of a calendar quarter, an
amount equal to five percent (5%) of gross revenues as determined in accordance
with GAAP for such four (4) calendar quarters; and (v) with respect to the hotel
properties other than the Marriott Long Wharf Hotel, the Marriott Cambridge
Center Hotel and the Cambridge Residence Inn, for any rolling four (4) calendar
quarters, determined as of the last day of a calendar quarter, an amount equal
to the applicable percentage of gross revenues as determined in accordance with
GAAP for such four (4) calendar quarters, which percentage shall be the
percentage for each such hotel as is to be maintained on the books of the
Borrower or in a separate reserve account for the replacement or repair of such
hotel's furniture, fixtures and equipment pursuant to (and in

                                       -4-


no event less than as required by) the applicable hotel management agreement or
franchise agreement (which such agreement shall be in form and substance
customary for a national hotel franchise).

    APPLICABLE L/C PERCENTAGE. With respect to any Letter of Credit, a per annum
percentage equal to the Applicable Eurodollar Margin in effect on the date on
which such Letter of Credit was issued.

    APPLICABLE EURODOLLAR MARGIN. With respect to Eurodollar Rate Loans, the
spread, expressed in basis points, over the Eurodollar Rate and used in
calculating the interest rate applicable to Eurodollar Rate Loans which spread
shall vary from time to time in relationship to variances in the Debt Ratings as
set forth below. The applicable Debt Ratings and Eurodollar Spreads (bps) for
Eurodollar Rate Loans are as set forth in the following table:




          S&P                 Moody's             Eurodollar spread (bps)
          ---                 -------             -----------------------
                                            
          A- or above         A3 or above         55.0

          BBB+                Baa1                65.0

          BBB                 Baa2                70.0

          BBB-                Baa3                90.0

          Below BBB- or       Below Baa3 or
          unrated             unrated            125.0


In the event the Debt Ratings from the two agencies referred to above are not
equivalent, the Eurodollar Spread (bps) will be determined (i) based on the
higher of the two Debt Ratings if the lower Debt Rating is no more than one
level lower than the higher Debt Rating, and (ii) based on the average of the
two Debt Ratings if the lower Debt Rating is more than one level lower than the
higher Debt Rating. Adjustments in the Eurodollar Spread (bps) for a Eurodollar
Rate Loan based upon a change in a Debt Rating level shall be effective on the
first day following the change in such Debt Rating.

The Borrower shall notify the Agent in writing of any change in the Debt Rating
as and when such change occurs.

    APPLICABLE PRIME RATE MARGIN. Zero.

    APPROVED CONDOMINIUM PROPERTY. A Real Estate Asset which is a condominium
unit and in which a member of the BP Group owns 100% of the interests (including
100% of the unit owner's voting rights) in the unit, PROVIDED that the Agent has
reviewed and approved the condominium documents governing such condominium (and
such documents are not amended thereafter) with such approval not to be
unreasonably withheld (it being acknowledged that unless the Agent has raised an
objection with 14

                                       -5-


days after it has received copies of the applicable condominium documents, the
Agent shall be deemed to have approved such documents). The Agent hereby
acknowledges that, as of the date hereof, 111 Huntington Avenue, 399 Park Avenue
and the Citigroup Center Property are Approved Condominium Properties.
Notwithstanding the foregoing, an Approved Condominium Property which is not
100% owned by the Borrower (including 100% of the unit owner's voting rights)
may not be or become a Borrowing Base Property without the prior written consent
of the Majority Banks.

    ARRANGER. Fleet Securities, Inc.

    ASSUMED TEST DEBT SERVICE. For any fiscal quarter, an amount equal to the
aggregate amount determined to be the payments which would be required during
such quarter to amortize the average amount of Unsecured Consolidated Total
Indebtedness outstanding during such quarter with respect to the Borrowing Base
Properties, using a twenty-five (25) year mortgage style amortization schedule,
and using an annual interest rate equal to the sum of two percent (2%) PLUS the
imputed seven (7) year United States Treasury notes annual yield as of the last
day of such fiscal quarter based upon published quotes for Treasury notes having
seven (7) years to maturity.

    ASSIGNMENT AND ASSUMPTION. See Section 20.1.

    BANKS. Collectively, Fleet and the other lending institutions listed on
SCHEDULE 2 hereto and any other banks which may provide additional commitments
and become parties to this Agreement, and any other Person who becomes an
assignee of any rights of a Bank pursuant to Section 20 or a Person who acquires
all or substantially all of the stock or assets of a Bank.

    BID RATE ADVANCE. A borrowing consisting of simultaneous Bid Rate Loans to
the Borrower from each of the Banks whose offer to make a Bid Rate Loan as part
of such borrowing has been accepted by the Borrower under the applicable auction
bidding procedure described in Section 2.9.

    BID RATE ADVANCE BORROWING NOTICE. See Section 2.9(b)(i).

    BID RATE LOAN. A loan by a Bank to the Borrower as part of a Bid Rate
Advance resulting from the applicable auction bidding procedure described in
Section 2.9.

    BID RATE MAXIMUM AMOUNT. At any particular time of reference, an amount
equal to fifty percent (50%) of the Total Commitment then in effect.

    BID RATE NOTES. The promissory notes substantially in the form of Exhibit
D-1 hereto which evidence the Bid Rate Loans.

    BORROWER. See the preamble hereto.

                                       -6-


    BORROWING BASE. As determined from time to time, the Borrowing Base
Properties.

    BORROWING BASE AVAILABILITY. As at any date of determination an amount equal
to the Eligible Amount on such date MINUS the Maximum Drawing Amount on such
date.

    BORROWING BASE CONDITIONS. See definition of "Borrowing Base Property".

    BORROWING BASE DEBT SERVICE COVERAGE RATIO. As of any date of determination,
the ratio of (i) Borrowing Base Net Operating Income as determined on such date
DIVIDED BY 4, to (ii) the Assumed Test Debt Service applicable to the quarter
upon which the Borrowing Base Net Operating income was based.

    BORROWING BASE NET OPERATING INCOME. As of any date of determination, the
Net Operating Income calculated with respect to the Real Estate Assets which are
Borrowing Base Properties during the quarter upon which such Net Operating
Income is based, PROVIDED that such Net Operating Income shall be adjusted on a
PRO FORMA basis to account for Real Estate Assets that were acquired by the
Borrower and added to the Borrowing Base during such quarter by projecting the
results generated by any such Real Estate Asset for the portion of the
applicable quarter during which the Borrower owned (or ground-leased) such Real
Estate Asset over the entire applicable quarter.

    BORROWING BASE PROPERTY. As of any date of determination, an Unencumbered
Asset owned by the Borrower that: (i) is a Permitted Property, (ii) is not the
subject of a Disqualifying Structural Event, (iii) is not the subject of a
Disqualifying Environmental Event, (iv) is not a Real Estate Asset Under
Development, (v) is wholly-owned or ground-leased by the Borrower or is an
Approved Condominium Property which is a Permitted Property, (vi) is not subject
to a Non-Material Breach, and (vii) has been designated by the Borrower in
writing to the Agent as a Real Estate Asset that is a Borrowing Base Property,
PROVIDED that on such date of determination, the Unencumbered Assets that are
Borrowing Base Properties, taken as a whole, shall have been 85% leased in the
aggregate as of the date of such determination, and PROVIDED, FURTHER, that each
request to include an Unencumbered Asset as a Borrowing Base Property shall be
accompanied by a compliance certificate in the form of EXHIBIT C-5 attached
hereto (the foregoing clauses (i) through (vii) and the succeeding PROVISOS
being herein referred to collectively as the "Borrowing Base Conditions"). The
Borrowing Base Properties that constitute the Borrowing Base on the Closing Date
are set forth on SCHEDULE 3.

    BORROWING BASE VALUE. As of any date of determination, an amount equal to
(x) the amount of Unrestricted Cash and Cash Equivalents of the Borrower on such
date PLUS (y) (i) the Borrowing Base Net Operating Income from the Borrowing
Base Properties as determined on such date, MINUS (ii) the amount by which the
Annualized Borrowing Base

                                       -7-


Capital Expenditures applicable to the quarter upon which such Borrowing Base
Net Operating Income was based exceeds the amount deducted for Capital
Expenditures in determining such Borrowing Base Net Operating Income, with the
number resulting from such subtraction being DIVIDED BY the Capitalization Rate;
PROVIDED that (1) such Borrowing Base Net Operating Income shall be adjusted on
a PRO FORMA basis to account for Real Estate Assets that were acquired by the
Borrower and added to the Borrowing Base during such quarter by projecting the
results generated by any such Real Estate Asset for the portion of the
applicable quarter during which the Borrower owned (or ground-leased) such Real
Estate Asset over the entire applicable quarter, (2) with respect to a Real
Estate Asset that was a Real Estate Asset Under Development and for which the
Borrower has received a certificate of occupancy or such Real Estate Asset may
otherwise be lawfully occupied for its intended use and, to the extent that such
Real Estate Asset otherwise qualifies as a Borrowing Base Property, the Borrower
may calculate the Borrowing Base Value of such Real Estate Asset either in the
manner set forth above or at the cost basis value (or, with respect to 399 Park
Avenue, other fixed value as provided in this Agreement) for a period of twelve
months after the issuance of the certificate of occupancy or such Real Estate
Asset may otherwise be lawfully occupied for its intended use, and (3) with
respect to a Real Estate Asset (not a Real Estate Asset Under Development)
acquired by the Borrower after the date hereof, to the extent that such Real
Estate Asset otherwise qualifies as a Borrowing Base Property, the Borrower may
calculate the Borrowing Base Value of such Real Estate Asset either in the
manner set forth above or at the cost basis value (or, with respect to 399 Park
Avenue, other fixed value as provided in this Agreement) for a period of twelve
months after the date of acquisition by the Borrower, and PROVIDED, FURTHER,
that at no time may the Borrowing Base Value attributable to hotel properties
constitute more than 33 1/3% of the total Borrowing Base Value. For purposes of
determining Borrowing Base Value, from the Closing Date through June 29, 2003,
399 Park Avenue shall be included in the Borrowing Base at the fixed value equal
to $1,000,000,000 rather than at the value that would be attributable to it in
accordance with the calculation required above by this definition of Borrowing
Base Value, PROVIDED that (i) 399 Park Avenue must at all times meet the
requirements of a Borrowing Base Property and (ii) for the quarterly reporting
period ending on June 30, 2003 and for all periods thereafter, the Borrowing
Base Value attributable to 399 Park Avenue shall be determined in accordance
with the calculation required by the first sentence of this definition of
Borrowing Base Value.

    BP GROUP. Collectively, (i) BPLP, (ii) BPI, (iii) the respective
Subsidiaries of BPLP and BPI and (iv) the Partially-Owned Entities.

    BPI. Boston Properties, Inc., a Delaware corporation and the sole general
partner of the Borrower.

    BUILDINGS. Individually and collectively, the buildings, structures and
improvements now or hereafter located on the Real Estate Assets.

                                       -8-


    BUSINESS DAY. Any day on which banking institutions in Boston,
Massachusetts, are open for the transaction of banking business and, in the case
of Eurodollar Rate Loans, also a day which is a Eurodollar Business Day.

    CAPITAL EXPENDITURES. Any expenditure for any item that would be treated or
defined as a capital expenditure under GAAP or the Code.

    CAPITALIZATION RATE. The Capitalization Rate shall be (i) 9.0% for Real
Estate Assets other than the CBD Properties, and (ii) 8.5% for Real Estate
Assets which are CBD Properties.

    CAPITALIZED LEASES. Leases under which the Borrower or any of its
Subsidiaries or any Partially-Owned Entity is the lessee or obligor, the
discounted future rental obligations under which are required to be capitalized
on the balance sheet of the lessee or obligor in accordance with GAAP.

    CBD PROPERTIES. Each of the Real Estate Assets listed on SCHEDULE 4 and each
other Real Estate Asset which is designated by the Agent and the Borrower as a
CBD Property from time to time.

    CERCLA. See Section 7.18.

    CITIGROUP CENTER PROPERTY. The property located at 153 East 53rd Street, New
York, New York and commonly referred to as the "Citigroup Center". The Agent
hereby acknowledges that, as of the date hereof, the Citigroup Center Property
is a CBD Property.

    CLOSING DATE. January 17, 2003.

    CODE. The Internal Revenue Code of 1986, as amended and in effect from time
to time.

    COMPLETED LOAN REQUEST. A loan request accompanied by all information
required to be supplied under the applicable provisions of Section 2.4.

    COMMITMENT. With respect to each Bank, the amount set forth from time to
time on SCHEDULE 2 hereto as the amount of such Bank's Commitment to make
Revolving Credit Loans to, and to participate in the issuance, extension and
renewal of Letters of Credit for the account of, the Borrower as such SCHEDULE 2
may be amended from time to time in accordance with the terms of this Agreement.

    COMMITMENT PERCENTAGE. With respect to each Bank, the percentage set forth
on SCHEDULE 2 hereto as such Bank's percentage of the Total Commitment, as such

                                       -9-


SCHEDULE 2 may be amended from time to time in accordance with the terms of this
Agreement.

    CONSOLIDATED OR CONSOLIDATED. With reference to any term defined herein,
shall mean that term as applied to the accounts of the Borrower and its
Subsidiaries, or BPI and its Subsidiaries (as the case may be), consolidated in
accordance with GAAP in accordance with the terms of this Agreement.

    CONSOLIDATED EBITDA. In relation to the Borrower and its Subsidiaries for
any fiscal quarter, an amount equal to, without double-counting, the net income
or loss of the Borrower and its Subsidiaries determined in accordance with GAAP
(before minority interests and excluding the adjustment for so-called
"straight-line rent accounting") for such quarter, PLUS (x) the following to the
extent deducted in computing such Consolidated net income for such quarter: (i)
Consolidated Total Interest Expense for such quarter, (ii) real estate
depreciation, amortization and extraordinary items for such quarter, and (iii)
other non-cash charges for such quarter; and MINUS (y) (i) all gains (or PLUS
all losses) attributable to the sale or other disposition of assets or debt
restructurings in such quarter, in each case (i.e., (x) and (y)(i) hereof)
adjusted to include the Borrower's or any Subsidiary's PRO RATA share of EBITDA
from any Partially-Owned Entity in such quarter, based on its percentage
ownership interest in such Partially-Owned Entity (or such other amount to which
the Borrower or such Subsidiary is entitled or for which the Borrower or such
Subsidiary is obligated based on an arm's length agreement), and (ii) for the
purposes of calculating Consolidated Total Adjusted Asset Value only, all
interest income of the Borrower and its Subsidiaries received in connection with
any Mortgages. In determining Consolidated EBITDA for the purposes of
calculating Fair Market Value of Real Estate Assets and Consolidated Total
Adjusted Asset Value only, any and all income of the Borrower and its
Subsidiaries received from any Real Estate Asset that is included in such
calculations at its cost basis value (or, as to 399 Park Avenue, other fixed
value as provided in this Agreement) shall be excluded.

    CONSOLIDATED FIXED CHARGES. For any fiscal quarter, an amount equal to (i)
Consolidated Total Interest Expense for such quarter PLUS (ii) the aggregate
amount of scheduled principal payments of Indebtedness (excluding optional
prepayments, balloon payments at maturity and any mid-term balloon payments of
principal with respect to Indebtedness otherwise requiring equal periodic
amortization payments of principal and interest over the term of such
Indebtedness (and any balloon payments at maturity with respect to such
Indebtedness)) required to be made during such quarter by the Borrower and its
Subsidiaries on a Consolidated basis PLUS (iii) the aggregate amount of
capitalized interest required in accordance with GAAP to be paid or accrued
during such quarter by the Borrower and its Subsidiaries PLUS (iv) Annualized
Capital Expenditures applicable to such quarter DIVIDED BY 4 PLUS (v) the
dividends and distributions, if any, paid or required to be paid during such
quarter on the Preferred Equity (Section 10.3(B)) or the Preferred Creditor
Equity (Section 10.3(A)), as applicable, of the Borrower, BPI or any of their
respective Subsidiaries.

                                      -10-


    CONSOLIDATED NET WORTH. As of any date of determination, an amount equal to
the Consolidated net worth of the Borrower and its Subsidiaries, as determined
in accordance with GAAP.

    CONSOLIDATED TOTAL ADJUSTED ASSET VALUE. As of any date of determination, an
amount equal to the sum of (i) the Fair Market Value of Real Estate Assets as of
such date, PLUS (ii) 100% of the value of Unrestricted Cash and Cash Equivalents
on such date, PLUS (iii) 100% of the Development Costs incurred and paid to date
by the Borrower with respect to any Real Estate Assets which are Real Estate
Assets Under Development on such date, provided that, for purposes of this
clause (iii), the aggregate amount of Development Costs included in the
calculation of Consolidated Total Adjusted Asset Value shall not exceed an
amount equal to 20% of the sum of the Fair Market Value of Real Estate Assets on
such date PLUS the value of Unrestricted Cash and Cash Equivalents on such date
(the "Eligible Real Estate Development Costs"), PLUS (iv) with respect to each
Mortgage, the lesser of (y) the aggregate amount of principal under such
Mortgage that will be due and payable to the Borrower or its Subsidiaries (to
the extent of Borrower's direct or indirect interest therein) and (z) the
purchase price paid by the Borrower or one of its Subsidiaries to acquire such
Mortgage, PLUS (v) Accounts Receivable as of such date, PLUS (vi) 100% of the
value (determined on the so-called mark-to-market basis) of the Marketable
Securities owned by the Borrower or its Subsidiaries on such date, PROVIDED that
(1) the aggregate value attributed to such Marketable Securities which are not
of the type described in clauses (a), (b) or (c) of Section 9.3 may not exceed
2% of the Consolidated Total Adjusted Asset Value at any time, and (2) such
Marketable Securities must not be subject to any lock-up or other transfer
restrictions, plus (vii) the book value of land owned by the Borrower, as
evidenced by the Borrower's balance sheet delivered to the Agent.
Notwithstanding the foregoing, at any time at which the value determined
pursuant to clause (iv) of the preceding sentence equals or exceeds 10% of the
total Fair Market Value of Real Estate Assets at such time, then upon the
occurrence of an event of default under any Mortgage, the portion of the value
of such defaulted Mortgage which is in excess of 10% of the total Fair Market
Value of Real Estate Assets at such time ("Excess Value") shall be reduced to
seventy-five percent (75%) of the Excess Value as determined in this
subparagraph (iv) until the earlier to occur of (a) the event of default under
the Mortgage is cured in a commercially reasonable manner and (b) one hundred
eighty (180) days after the occurrence of the event of default; thereafter, if
the event of default under the defaulted Mortgage has not been cured in a
commercially reasonable manner, the portion of the value of the defaulted
Mortgage which is in excess of 10% of the total Fair Market Value of Real Estate
Assets at such time shall be reduced to fifty percent (50%) of the Excess Value
as determined as set forth above until the earlier to occur of (a) the event of
default under the Mortgage is cured in a commercially reasonable manner and (b)
eighteen (18) months after the occurrence of the event of default; thereafter,
if the event of default under the defaulted Mortgage has not been cured in a
commercially reasonable manner, the portion of the

                                      -11-


value of the defaulted Mortgage which is in excess of 10% of the total Fair
Market Value of Real Estate Assets at such time shall be reduced to zero.

    CONSOLIDATED TOTAL INDEBTEDNESS. As of any date of determination,
Consolidated Total Indebtedness means for the Borrower and its Subsidiaries, the
sum of (without double-counting) but subject to the limitations set forth below,
(i) all Accounts Payable on such date, (ii) all Indebtedness outstanding on such
date, and (iii) all Letters of Credit outstanding on such date, in each case
whether Recourse, Without Recourse or contingent, PROVIDED, however, that
amounts not drawn under the Revolving Credit Loans or any other Indebtedness on
such date shall not be included in calculating Consolidated Total Indebtedness,
and PROVIDED, FURTHER, that (without double-counting), (x) each of the following
shall be included in Consolidated Total Indebtedness: (a) all amounts of
guarantees, indemnities for borrowed money, stop-loss agreements and the like
provided by the Borrower or any of its Subsidiaries, in each case in connection
with and guarantying repayment of amounts outstanding under any other
Indebtedness; (b) all amounts for which a letter of credit has been issued for
the account of the Borrower or any of its Subsidiaries; (c) all amounts of bonds
posted by the Borrower or any of its Subsidiaries guaranteeing performance or
payment obligations; and (d) all liabilities of the Borrower or any of its
Subsidiaries as partners, members or the like for liabilities (whether such
liabilities are Recourse, Without Recourse or contingent obligations of the
applicable partnership or other Person) of partnerships or other Persons in
which any of them have an equity interest, which liabilities are for borrowed
money or any of the matters listed in clauses (a), (b) or (c), and (y) each of
the following shall be excluded from Consolidated Total Indebtedness: (a)
defeased Indebtedness of the Borrower and its Subsidiaries; and (b) Indebtedness
of the Borrower and its Subsidiaries secured by Unrestricted Cash and Cash
Equivalents (it being agreed that, for this purpose, a lien on such Unrestricted
Cash or Cash Equivalents in favor of the Person holding such Indebtedness shall
not be deemed a "Lien" for purposes of the definition of Unrestricted Cash and
Cash Equivalents). Notwithstanding the foregoing (without double counting), with
respect to any Partially-Owned Entity, (x) to the extent that the Borrower or
any Subsidiary or such Partially-Owned Entity is providing a completion guaranty
in connection with a construction loan entered into by a Partially-Owned Entity,
Consolidated Total Indebtedness shall only include the Borrower's or such
Subsidiary's PRO RATA liability under the Indebtedness relating to such
completion guaranty (or, if greater, but without double-counting, the Borrower's
or such Subsidiary's liability under such completion guaranty (it being agreed
that to the extent that the liability of the Borrower or its Subsidiaries under
such completion guaranty would not constitute a liability (contingent or
otherwise) under GAAP, such liability will not be included in Consolidated Total
Indebtedness)) and (y) in connection with the liabilities described in clauses
(a) and (d) above, the Borrower shall be required to include in Consolidated
Total Indebtedness the portion of the liabilities of such Partially-Owned Entity
which are attributable to the Borrower's or such Subsidiary's percentage equity
interest in such Partially-Owned Entity or such other amount (if greater) of
such liabilities for which the Borrower or its Subsidiaries are, or have agreed
to be, liable by way of guaranty,

                                      -12-


indemnity for borrowed money, stop-loss agreement or the like (excluding
liability under completion guaranties, which shall be included as and to the
extent set forth in clause (x) of this sentence)), it being agreed that
Indebtedness of a Partially-Owned Entity shall not be excluded from Consolidated
Total Indebtedness by virtue of the liability of such Partially-Owned Entity
being Without Recourse. For purposes hereof, the value of Accounts Payable shall
be determined in accordance with GAAP, and the amount of borrowed money shall
equal the sum of (1) the amount of borrowed money as determined in accordance
with GAAP PLUS (2) the amount of those contingent liabilities for borrowed money
set forth in subsections (a) through (d) above, but shall exclude any adjustment
for so-called "straight-line interest accounting" or the "constant yield to
maturity method" required under GAAP.

    CONSOLIDATED TOTAL INTEREST EXPENSE. For any fiscal quarter, the aggregate
amount of interest required in accordance with GAAP to be paid or accrued (but
excluding interest funded from the proceeds of any construction loan), without
double-counting, by the Borrower and its Subsidiaries during such quarter on:
(i) all Indebtedness of the Borrower and its Subsidiaries (including the Loans
and including original issue discount and amortization of prepaid interest, if
any), (ii) all amounts available for borrowing, or for drawing under letters of
credit, if any, issued for the account of the Borrower or any of its
Subsidiaries, but only if such interest was or is required to be reflected as an
item of expense, and (iii) all commitment fees, agency fees, facility fees,
balance deficiency fees and similar fees and expenses in connection with the
borrowing of money.

    CONVERSION REQUEST. A notice given by the Borrower to the Agent of its
election to convert or continue a Loan in accordance with Section 2.5.

    DEBT RATING. The credit rating assigned by either or both of S&P and/or
Moody's to (i) BPLP's senior, long-term unsecured debt, or (ii) BPLP's private
debt, PROVIDED that the Agent shall have the right to require a review and
confirmation of any such private debt rating, but shall not require such review
and confirmation more than twice a year unless a Default or Event of Default has
occurred and is continuing.

    DEFAULT. When used with reference to this Agreement or any other Loan
Document, an event or condition specified in Section 14.1 that, but for the
requirement that time elapse or notice be given, or both, would constitute an
Event of Default.

    DELINQUENT BANK. See Section 16.5 (c).

    DEVELOPMENT COSTS. Construction, development and/or acquisition costs
relating to a Real Estate Asset Under Development, PROVIDED that for Real Estate
Assets Under Development owned by any Partially-Owned Entity, the Development
Costs of such Real Estate Asset Under Development shall only be the Borrower's
pro-rata share of the Development Costs of such Real Estate Asset Under
Development (based on the greater

                                      -13-


of (x) the Borrower's percentage equity interest in such Partially-Owned Entity
or (y) the Borrower's obligation to provide funds to such Partially-Owned
Entity).

    DISQUALIFYING ENVIRONMENTAL EVENT. Any Release or threatened Release of
Hazardous Substances, any violation of Environmental Laws or any other similar
environmental event with respect to any Borrowing Base Property that will, in
the Borrower's and the Agent's reasonable opinion cost in excess of (x) with
respect to CBD Properties, $10,000,000 and (y) with respect to all other
Borrowing Base Properties, $1,000,000 to remediate or, which, with respect to
the Borrowing Base Properties, will, in the Borrower's and Agent's reasonable
opinion cost in excess of $35,000,000 in the aggregate to remediate, PROVIDED
that (i) with respect to any particular Borrowing Base Property, if, in the
Agent's reasonable opinion, such environmental events will cost in excess of the
$1,000,000 or $10,000,000 cost basket, as applicable, but such environmental
events do not have a material adverse impact on the use and occupancy of such
Borrowing Base Property, (A) such Borrowing Base Property will be permitted to
remain in the Borrowing Base unless and until the Agent determines, in its
reasonable opinion, that such environmental events do have a material adverse
impact on such use and occupancy, and (B) the Borrowing Base Value attributable
to such Borrowing Base Property shall be reduced by an amount equal to the
aggregate of all costs in excess of the applicable cost basket, net of such
costs covered by an indemnification in favor of the Borrower, in form and
substance satisfactory to the Agent from a third party who, in the reasonable
opinion of the Agent, is a credit-worthy entity, and (ii) in the event the
Borrower and the Agent determine that environmental events will cost in excess
of $35,000,000 in the aggregate to remediate for all Borrowing Base Properties,
the Borrowing Base Value shall be reduced by an amount equal to the aggregate of
all costs in excess of such $35,000,000 to the extent such costs in excess of
$35,000,000 are not covered by an indemnification in favor of the Borrower, in
form and substance satisfactory to the Agent from a third party who, in the
reasonable opinion of the Agent, is a credit-worthy entity.

    DISQUALIFYING STRUCTURAL EVENT. Any structural issue, which, with respect to
any Borrowing Base Property other than rehab properties, will, in the Borrower's
and the Agent's reasonable opinion cost in excess of (x) with respect to CBD
Properties, $10,000,000 and (y) all other Borrowing Base Properties, $1,000,000
to fix or, which, with respect to the Borrowing Base Properties other than rehab
properties, will, in the Borrower's and Agent's reasonable opinion cost in
excess of $35,000,000 in the aggregate to fix, PROVIDED that (i) with respect to
any particular Borrowing Base Property, if, in the Agent's reasonable opinion,
such structural issues will cost in excess of the $1,000,000 or $10,000,000 cost
basket, as applicable, but such structural issues do not have a material adverse
impact on the use and occupancy of such Borrowing Base Property, (A) such
Borrowing Base Property will be permitted to remain in the Borrowing Base unless
and until the Agent determines, in its reasonable opinion, that such structural
issues do have a material adverse impact on such use and occupancy, and (B) the
Borrowing Base Value attributable to such Borrowing Base Property shall be
reduced by

                                      -14-


an amount equal to the aggregate of all costs in excess of the applicable cost
basket, and (ii) in the event the Borrower and the Agent determine that such
structural issues will cost in excess of $35,000,000 in the aggregate to fix for
all Borrowing Base Properties, the Borrowing Base Value shall be reduced by an
amount equal to the aggregate of all costs in excess of such $35,000,000.

    DISTRIBUTION. With respect to:

               (i)   the Borrower, any distribution of cash or other cash
          equivalent, directly or indirectly, to the partners of the Borrower;
          or any other distribution on or in respect of any partnership
          interests of the Borrower; and

               (ii)  BPI, the declaration or payment of any dividend on or in
          respect of any shares of any class of capital stock of BPI, other than
          dividends payable solely in shares of common stock by BPI; the
          purchase, redemption, or other retirement of any shares of any class
          of capital stock of BPI, directly or indirectly through a Subsidiary
          of BPI or otherwise; the return of capital by BPI to its shareholders
          as such; or any other distribution on or in respect of any shares of
          any class of capital stock of BPI.

    DOLLARS OR $. Lawful currency of the United States of America.

    DRAWDOWN DATE. The date on which any Revolving Credit Loan is made or is to
be made, and the date on which any Revolving Credit Loan is converted or
continued in accordance with Section 2.5.

    ELIGIBLE AMOUNT. As of the date that any Loan is to be made hereunder, an
amount equal to the lesser of (i) the maximum amount that would permit Unsecured
Consolidated Total Indebtedness (exclusive of Accounts Payable, but including
amounts outstanding under any Loans and Letters of Credit after giving effect to
Loan Requests) to be less than 60% of the aggregate Borrowing Base Value on such
date (the "Advance Rate"), provided that at any time when Consolidated Total
Indebtedness equals or exceeds 60% of Consolidated Total Adjusted Asset Value,
as evidenced by the most recent financial statements delivered by the Borrower
pursuant to Section Section 8.4(a) and (b), the Advance Rate shall equal 55%,
and (ii) the maximum amount that would permit the Borrowing Base Debt Service
Coverage Ratio (after giving effect to such Loan) to be no less than 1.4 to 1.0.

    ELIGIBLE ASSIGNEE. Any of (a) a commercial bank (or similar financial
institution) organized under the laws of the United States, or any State thereof
or the District of Columbia, and having total assets in excess of
$1,000,000,000; (b) a savings and loan association or savings bank organized
under the laws of the United States, or any State

                                      -15-


thereof or the District of Columbia, and having a net worth of at least
$100,000,000, calculated in accordance with GAAP; and (c) a commercial bank (or
similar financial institution) organized under the laws of any other country
(including the central bank of such country) which is a member of the
Organization for Economic Cooperation and Development (the "OECD"), or a
political subdivision of any such country, and having total assets in excess of
$1,000,000,000, PROVIDED that such bank (or similar financial institution) is
acting through a branch or agency located in the United States of America.

    ELIGIBLE REAL ESTATE DEVELOPMENT COSTS. See definition of "Consolidated
Total Adjusted Asset Value".

    EMBARCADERO CENTER PROPERTY. Collectively, the properties located in the
financial district of San Francisco, California, and consisting of One
Embarcadero Center, Two Embarcadero Center, Three Embarcadero Center, Four
Embarcadero Center, Embarcadero Center West and the Federal Reserve Building.

    EMPLOYEE BENEFIT PLAN. Any employee benefit plan within the meaning of
Section 3(3) of ERISA maintained or contributed to by the Borrower or any ERISA
Affiliate, other than a Multiemployer Plan.

    ENVIRONMENTAL LAWS. See Section 7.18(a).

    ENVIRONMENTAL REPORTS. See Section 7.18

    ERISA. The Employee Retirement Income Security Act of 1974, as amended and
in effect from time to time.

    ERISA AFFILIATE. Any Person which is treated as a single employer with the
Borrower under Section 414 of the Code.

    ERISA REPORTABLE EVENT. A reportable event with respect to a Guaranteed
Pension Plan within the meaning of Section 4043 of ERISA and the regulations
promulgated thereunder as to which the requirement of notice has not been
waived.

    EUROCURRENCY RESERVE RATE. For any day with respect to a Eurodollar Rate
Loan, the maximum rate (expressed as a decimal) at which any Bank subject
thereto would be required to maintain reserves under Regulation D of the Board
of Governors of the Federal Reserve System (or any successor or similar
regulations relating to such reserve requirements) against "Eurocurrency
Liabilities" (as that term is used in said Regulation D), if such liabilities
were outstanding. The Eurocurrency Reserve Rate shall be adjusted automatically
on and as of the effective date of any change in the Eurocurrency Reserve Rate.

                                      -16-


    EURODOLLAR BREAKAGE COSTS. With respect to any Eurodollar Rate Loan to be
prepaid prior to the end of the applicable Interest Period or not borrowed,
converted or continued ("drawn" and, with correlative meaning, "draw") after
elected, a prepayment "breakage" fee in an amount determined by the Agent in the
following manner:

               (i)   First, the Agent shall determine the amount by which (a)
          the total amount of interest which would have otherwise accrued
          hereunder on each installment of principal prepaid or not so drawn,
          during the period beginning on the date of such prepayment or failure
          to draw and ending on the last day of the applicable Eurodollar Rate
          Loan Interest Period (the "Reemployment Period"), exceeds (b) the
          total amount of interest which would accrue, during the Reemployment
          Period, on any readily marketable bond or other obligation of the
          United States of America designated by the Agent in its sole
          discretion at or about the time of such payment, such bond or other
          obligation of the United States of America to be in an amount equal
          (as nearly as may be) to the amount of principal so paid or not drawn
          after elected and to have maturity at the end of the Reemployment
          Period, and the interest to accrue thereon to take account of
          amortization of any discount from par or accretion of premium above
          par at which the same is selling at the time of designation. Each such
          amount is hereinafter referred to as an "Installment Amount".

               (ii)  Second, each Installment Amount shall be treated as payable
          on the last day of the Eurodollar Rate Loan Interest Period which
          would have been applicable had such principal installment not been
          prepaid or not drawn.

               (iii) Third, the amount to be paid on each such date shall be the
          present value of the Installment Amount determined by discounting the
          amount thereof from the date on which such Installment Amount is to be
          treated as payable, at the same yield to maturity as that payable upon
          the bond or other obligation of the United States of America
          designated as aforesaid by the Agent.

    EURODOLLAR BUSINESS DAY. Any day on which commercial banks are open for
international business (including dealings in Dollar deposits) in London or such
other eurodollar interbank market as may be selected by the Agent in its sole
discretion acting in good faith.

    EURODOLLAR RATE. For any Interest Period with respect to a Eurodollar Rate
Loan, the rate per annum equal to the quotient (rounded upwards to the nearest
1/16 of one percent) of (a) the rate at which the Bank serving as the Agent is
offered Dollar deposits two Eurodollar Business Days prior to the beginning of
such Interest Period in an

                                      -17-


interbank eurodollar market where the eurodollar and foreign currency and
exchange operations of the Bank serving as the Agent are customarily conducted
for delivery on the first day of such Interest Period for the number of days
comprised therein and in an amount comparable to the amount of the Eurodollar
Rate Loan to which such Interest Period applies, divided by (b) a number equal
to 1.00 MINUS the Eurocurrency Reserve Rate.

    EURODOLLAR RATE LOAN(S). Loans bearing interest calculated by reference to
the Eurodollar Rate.

    EVENT OF DEFAULT. See Section 14.1.

    EXCESS VALUE. See definition of "Consolidated Total Adjusted Asset Value".

    EXTENSION. See Section 2.11.

    FACILITY FEE. See Section 2.3(d).

                                      -18-


    FAIR MARKET VALUE OF REAL ESTATE ASSETS. As of any date of determination,
the sum of (A) with respect to Real Estate Assets other than hotel properties,
an amount equal to (i)(x) Consolidated EBITDA for the most recent one (1)
complete fiscal quarter, MINUS (y) $.0625 MULTIPLIED BY the aggregate square
footage of all Real Estate Assets other than hotel properties at such date;
MULTIPLIED BY (ii) 4; with the product being DIVIDED BY (iii) the applicable
Capitalization Rate, PLUS (B) with respect to Real Estate Assets which are hotel
properties, an amount equal to (i)(x) Consolidated EBITDA for the most recent
four (4) consecutive complete fiscal quarters, MINUS (y) the respective
Annualized Capital Expenditure for each of the hotel properties; DIVIDED BY (ii)
the applicable Capitalization Rate. Notwithstanding the foregoing, (a) (i)
solely for the period commencing on the Closing Date and ending on June 29,
2003, the Fair Market Value of Real Estate Assets attributable to 399 Park
Avenue shall be an amount equal to $1,000,000,000 and (ii) for the quarterly
reporting period ending on June 30, 2003 and for all periods thereafter, the
Fair Market Value of Real Estate Assets attributable to 399 Park Avenue shall be
determined in accordance with the calculation required by the first sentence of
this definition, (b) with respect to a Real Estate Asset that was a Real Estate
Asset Under Development and for which the Borrower has received a certificate of
occupancy or such Real Estate Asset may otherwise be lawfully occupied for its
intended use, the Borrower may calculate the Fair Market Value of Real Estate
Assets of such Real Estate Asset either in the manner set forth in this
definition above or at the cost basis value (or, with respect to 399 Park
Avenue, other fixed value as provided in this Agreement) for a period of twelve
months after the issuance of the certificate of occupancy or such Real Estate
Asset may otherwise be lawfully occupied for its intended use, and (c) with
respect to a Real Estate Asset (not a Real Estate Asset Under Development)
acquired by the Borrower after the date hereof, the Borrower may calculate the
Fair Market Value of Real Estate Assets of such Real Estate Asset either in the
manner set forth in this definition above or at the cost basis value (or, with
respect to 399 Park Avenue, other fixed value as provided in this Agreement) for
a period of twelve months after the date of acquisition by the Borrower.

    FEDERAL FUNDS RATE. See definition of "Prime Rate".

    FINANCIAL STATEMENT DATE. September 30, 2002.

    FRONTING BANK. Fleet or such other Bank as the Borrower may identify in
accordance with Section 3.1.5.

    "FUNDS FROM OPERATIONS". As defined in accordance with resolutions adopted
by the Board of Governors of the National Association of Real Estate Investment
Trusts as in effect on the Closing Date.

    GAAP. Generally accepted accounting principles, consistently applied.

                                      -19-


    GUARANTEED PENSION PLAN. Any employee pension benefit plan within the
meaning of Section 3(2) of ERISA maintained or contributed to by the Borrower or
BPI, as the case may be, or any ERISA Affiliate of any of them the benefits of
which are guaranteed on termination in full or in part by the PBGC pursuant to
Title IV of ERISA, other than a Multiemployer Plan.

    HAZARDOUS SUBSTANCES. See Section 7.18(b).

    INCREASE. See Section 2.10.

    INCREASE CONDITIONS. The satisfaction of each of the following:

          (a)  no Default or Event of Default shall have occurred and be
               continuing (both before and after giving effect to the Increase)
               and all representations and warranties contained in the Loan
               Documents shall be true and correct as of the effective date of
               the Increase (except (i) to the extent of changes resulting from
               transactions contemplated or not prohibited by this Agreement or
               the other Loan Documents (including, without limitation, the fact
               that a Real Estate Asset may cease to be a Borrowing Base
               Property pursuant to the terms of this Agreement) and changes
               occurring in the ordinary course of business, (ii) to the extent
               that such representations and warranties relate expressly to an
               earlier date and (iii) to the extent otherwise represented by the
               Borrower with respect to the representation set forth in Section
               7.10);

          (b)  the Increase shall be extended on the same terms and conditions
               applicable to the other Loans; and

          (c)  to the extent any portion of the Increase is committed to by a
               third party financial institution or institutions not already a
               Bank hereunder, such financial institution shall be approved by
               the Agent (such approval not to be unreasonably withheld or
               delayed) and each such financial institution shall have signed a
               counterpart signature page becoming a party to this Agreement and
               a "Bank" hereunder.

    INDEBTEDNESS. All of the following obligations without duplication: (a) the
Obligations to the extent outstanding from time to time; (b) all debt and
similar monetary obligations for borrowed money, whether direct or indirect; (c)
all other liabilities for borrowed money secured by any Lien existing on
property owned or acquired subject thereto, whether or not the liability secured
thereby shall have been assumed; (d) reimbursement obligations for letters of
credit; and (e) all guarantees, endorsements and other contingent obligations
for or in connection with borrowed money whether direct or indirect in respect
of indebtedness or obligations of others.

                                      -20-


    INDEXED RATE AUCTION. With respect to a request by the Borrower for a Bid
Rate Advance, a solicitation in which the Borrower specifies in the Bid Rate
Advance Borrowing Notice that the rates of interest to be offered by the Banks
shall be rates per annum greater or less than the Eurodollar Rate plus the
Applicable Eurodollar Margin.

    INITIAL FINANCIAL STATEMENTS. See Section 7.4.

    INTEREST PAYMENT DATE. As to any Prime Rate Loan, the last day of any
calendar month in which such Loan is outstanding. As to any Eurodollar Rate
Loan, the last day of the applicable Interest Period and when such Loan is due,
and if such Interest Period is longer than three months, at intervals of three
months after the first day thereof. As to any Swingline Loan, the day such
Swingline Loan is due.

    INTEREST PERIOD. With respect to each Revolving Credit Loan, but without
duplication of any other Interest Period, (a) initially, the period commencing
on the Drawdown Date of such Loan and ending on the last day of one of the
following periods (as selected by the Borrower in a Completed Loan Request): (i)
for any Prime Rate Loan, the calendar month in which such Prime Rate Loan is
made (whether by borrowing or by conversion from a Eurodollar Rate Loan), and
(ii) for any Eurodollar Rate Loan, 1, 2, 3, 4 or 6 months; and (b) thereafter,
each period commencing at the end of the last day of the immediately preceding
Interest Period applicable to such Revolving Credit Loan and ending on the last
day of the applicable period set forth in (a)(i) and (ii) above (as selected by
the Borrower in a Conversion Request); PROVIDED that all of the foregoing
provisions relating to Interest Periods are subject to the following:

               (A) if any Interest Period with respect to a Prime Rate Loan
          would end on a day that is not a Business Day, that Interest Period
          shall end on the next succeeding Business Day;

               (B) if any Interest Period with respect to a Eurodollar Rate Loan
          would otherwise end on a day that is not a Business Day, that Interest
          Period shall be extended to the next succeeding Business Day unless
          the result of such extension would be to carry such Interest Period
          into another calendar month, in which event such Interest Period shall
          end on the immediately preceding Business Day;

               (C) if the Borrower shall fail to give notice of conversion as
          provided in Section 2.5, the Borrower shall be deemed to have
          requested a conversion of the affected Eurodollar Rate Loan to a Prime
          Rate Loan on the last day of the then current Interest Period with
          respect thereto;

               (D) any Interest Period relating to any Eurodollar Rate Loan that
          begins on the last Business Day of a calendar month (or on a day for

                                      -21-


          which there is no numerically corresponding day in the calendar month
          at the end of such Interest Period) shall, subject to subparagraph (E)
          below, end on the last Business Day of a calendar month; and

               (E) any Interest Period that would otherwise extend beyond the
          Maturity Date shall end on the Maturity Date.

    INVESTMENTS. All expenditures made and all liabilities incurred
(contingently or otherwise, but without double-counting): (i) for the
acquisition of stock, partnership or other equity interests or for the
acquisition of Indebtedness of, or for loans, advances, capital contributions or
transfers of property to, any Person; (ii) in connection with Real Estate Assets
Under Development; and (iii) for the acquisition of any other obligations of any
Person. In determining the aggregate amount of Investments outstanding at any
particular time: (a) there shall be included as an Investment all interest
accrued with respect to Indebtedness constituting an Investment unless and until
such interest is paid; (b) there shall be deducted in respect of each such
Investment any amount received as a return of capital (but only by repurchase,
redemption, retirement, repayment, liquidating dividend or liquidating
distribution); (c) there shall not be deducted in respect of any Investment any
amounts received as earnings on such Investment, whether as dividends, interest
or otherwise, except that accrued interest included as provided in the foregoing
clause (a) may be deducted when paid; and (d) there shall not be deducted from
the aggregate amount of Investments any decrease in the value thereof.

    JOINDER DOCUMENTS. The one or more Joinder Agreements among the Agent, the
Banks and any Wholly-owned Subsidiary which is to become a Borrower at any time
after the Closing Date, the form of which is attached hereto as EXHIBIT G,
together with all other documents, instruments and certificates required by any
such Joinder Agreement to be delivered by such Wholly-owned Subsidiary to the
Agent and the Banks on the date such Wholly-owned Subsidiary becomes a Borrower
hereunder.

    LEASES. Leases, licenses and agreements, whether written or oral, relating
to the use or occupation of space in or on the Buildings or on the Real Estate
Assets by Persons other than the Borrower, its Subsidiaries or any
Partially-Owned Entity.

    LETTER OF CREDIT. See Section 3.1.1.

    LETTER OF CREDIT APPLICATION. See Section 3.1.1.

    LETTER OF CREDIT FEE. See Section 3.6.

    LETTER OF CREDIT PARTICIPATION. See Section 3.1.4.

    LIABILITIES. All obligations, contingent and otherwise, that in accordance
with GAAP should be classified upon the obligor's balance sheet as liabilities,
or to which

                                      -22-


reference should be made by footnotes thereto, including in any event and
whether or not so classified: (a) all debt and similar monetary obligations,
whether direct or indirect, including, without limitation, all Indebtedness; (b)
all liabilities secured by any mortgage, pledge, security interest, lien,
charge, or other encumbrance existing on property owned or acquired subject
thereto, whether or not the liability secured thereby shall have been assumed;
and (c) all guarantees for borrowed money, endorsements and other contingent
obligations, whether direct or indirect, in respect of indebtedness or
obligations of others, including any obligation to supply funds (including
partnership obligations and capital requirements) to or in any manner to invest
in, directly or indirectly, the debtor, to purchase indebtedness, or to assure
the owner of indebtedness against loss, through an agreement to purchase goods,
supplies, or services for the purpose of enabling the debtor to make payment of
the indebtedness held by such owner or otherwise, and the obligations to
reimburse the issuer in respect of any letters of credit.

    LIEN. See Section 9.2.

    LOAN DOCUMENTS. Collectively, this Agreement, the Letter of Credit
Applications, the Letters of Credit, the Notes, the Joinder Documents and any
and all other agreements, instruments, documents or certificates now or
hereafter evidencing or otherwise relating to the Loans and executed and
delivered by or on behalf of the Borrower or its Subsidiaries or BPI or its
Subsidiaries in connection with or in any way relating to the Loans or the
transactions contemplated by this Agreement, and all schedules, exhibits and
annexes hereto or thereto, as any of the same may from time to time be amended
and in effect.

    LOANS. The Revolving Credit Loans, the Swingline Loans and the Bid Rate
Loans.

    MAJORITY BANKS. As of any date, the Banks whose aggregate Commitments
constitute at least fifty-one percent (51%) of the Total Commitment (or, if the
Commitments have been terminated, the Banks whose aggregate Commitments,
immediately prior to such termination, constituted at least fifty-one percent
(51%) of the Total Commitment).

    MARKETABLE SECURITIES. As of any date, the securities owned by the Borrower
or any of its Subsidiaries which are publicly traded on a nationally-recognized
exchange or in the over-the-counter markets.

    MATURITY DATE. January 17, 2006, or such earlier date (or later date
pursuant to Section 2.11) on which the Revolving Credit Loans shall become due
and payable pursuant to the terms hereof. The Maturity Date may be extended to
January 17, 2007 in accordance with the terms of Section 2.11.

                                      -23-


    MAXIMUM DRAWING AMOUNT. The maximum aggregate amount that the beneficiaries
may at any time draw under outstanding Letters of Credit, as such maximum
aggregate amount may be reduced from time to time pursuant to the terms of the
Letters of Credit.

    MINIMUM COMMITMENT. With reference to the Bank serving as the Agent, a
Commitment equal to the greater of (i) $50,000,000 or (ii) an amount which is
greater than or equal to the Commitment of any other Bank.

    MOODY'S. Moody's Investors Service, Inc., and its successors.

    MORTGAGES. Mortgage debt instruments, in which the Borrower holds a direct
or indirect interest, for real estate that is developed.

    MULTIEMPLOYER PLAN. Any multiemployer plan within the meaning of Section
3(37) of ERISA maintained or contributed to by the Borrower or any Guarantor as
the case may be or any ERISA Affiliate.

    NET OPERATING INCOME. As at any date of determination, an amount equal to
(i) the aggregate rental and other income from the operation of all Real Estate
Assets during the most recent complete fiscal quarter, MULTIPLIED BY 4; MINUS
(ii) all expenses and other proper charges incurred in connection with the
operation of such Real Estate Assets (including, without limitation, real estate
taxes, management fees, bad debt expenses and rent under ground leases) during
the most recently completed fiscal quarter MULTIPLIED BY 4; but, in any case,
before payment of or provision for debt service charges for such fiscal quarter,
income taxes for such fiscal quarter, capital expenses for such fiscal quarter,
and depreciation, amortization, and other non-cash expenses for such fiscal
quarter, all as determined in accordance with GAAP (except that any rent
leveling adjustments shall be excluded from rental income).

    NON-MATERIAL BREACH. See Section 14.

    NOTE RECORD. A Record with respect to any Note.

    NOTES. The Revolving Credit Notes, the Swingline Note and the Bid Rate
Notes.

    OBLIGATIONS. All indebtedness, obligations and liabilities of the Borrower
and its Subsidiaries to any of the Banks and the Agent, individually or
collectively (but without double-counting), under this Agreement and each of the
other Loan Documents and in respect of any of the Loans and the Notes and
Reimbursement Obligations incurred and the Letter of Credit Applications and the
Letters of Credit and other instruments at any time evidencing any thereof,
whether existing on the date of this Agreement or arising or incurred hereafter,
direct or indirect, joint or several, absolute or contingent, matured or

                                      -24-


unmatured, liquidated or unliquidated, secured or unsecured, arising by
contract, operation of law or otherwise.

    ORGANIZATIONAL DOCUMENTS. Collectively, (i) the Agreement of Limited
Partnership of BPLP, (ii) the Certificate of Limited Partnership of BPLP, (iii)
the Certificate of Incorporation of BPI, (iv) the by-laws of BPI, and (v) all of
the partnership agreements, corporate charters and by-laws, limited liability
company operating agreements, joint venture agreements or similar agreements,
charter documents and certificates or other agreements relating to the
formation, organization or governance of any Borrower (including, without
limitation, any Wholly-owned Subsidiary who becomes a Borrower from time to time
hereunder), in each case as any of the foregoing may be amended in accordance
with Section 8.21.

    PARTIALLY-OWNED ENTITY(IES). Any of the partnerships, associations,
corporations, limited liability companies, trusts, joint ventures or other
business entities in which the Borrower, directly, or indirectly through its
full or partial ownership of another entity, own an equity interest, but which
is not required in accordance with GAAP to be consolidated with the Borrower for
financial reporting purposes.

    PBGC. The Pension Benefit Guaranty Corporation created by Section 4002 of
ERISA and any successor entity or entities having similar responsibilities.

    PERMITS. All governmental permits, licenses, and approvals necessary for the
lawful operation and maintenance of the Real Estate Assets.

    PERMITTED LIENS. Liens permitted by Section 9.2.

    PERMITTED PROPERTY. A property which is an office property, an industrial
property or a hotel property (including any of such properties being
rehabilitated or expanded), including properties having uses ancillary to any of
the foregoing, including, without limitation, multifamily, retail and parking
facilities which are ancillary to any such office, industrial or hotel property,
and including, in any event, the Prudential Center in Boston, Massachusetts and
the Embarcadero Center Property.

    PERSON. Any individual, corporation, partnership, trust, limited liability
company, unincorporated association, business, or other legal entity, and any
government (or any governmental agency or political subdivision thereof).

    PREFERRED CREDITOR EQUITY. Any Preferred Equity issued by the Borrower, BPI
or any of their respective Subsidiaries which has any of the following
characteristics: (i) pursuant to the documents or agreements under which such
Preferred Equity was issued or is governed, the equity terms include any
covenant that the issuer must meet which, if breached, results in a default
permitting acceleration or other acceleration rights; or (ii) pursuant to the
documents or agreements under which such Preferred Equity was issued

                                      -25-


or is governed, there are any required dividends or other mandatory payments on
the equity that, if not paid, create acceleration rights in favor of the holder.
The Agent acknowledges that (i) none of the Preferred Equity which exists as of
the date of this Agreement constitutes Preferred Creditor Equity and (ii) no
subsequently issued Preferred Equity which is issued on substantially the same
terms (including that it contains no terms of the nature described in clauses
(i) and (ii) above), and which is substantially similar in form and substance,
to the Preferred Equity which exists as of the date of this Agreement shall
constitute Preferred Creditor Equity.

    PREFERRED EQUITY. Any preferred stock, preferred partnership interests,
preferred member interests or other preferred equity interests issued by the
Borrower, BPI or any of their respective Subsidiaries (including, in any event,
the Preferred Creditor Equity).

    PRIME RATE. The higher of (i) the annual rate of interest announced from
time to time by Fleet at its head office in Boston, Massachusetts as its "Prime
Rate" and (ii) one half of one percent (1/2%) PLUS the overnight federal funds
effective rate as published by the Board of Governors of the Federal Reserve
System, as in effect from time to time (the "Federal Funds Rate"). Any change in
the Prime Rate during an Interest Period shall result in a corresponding change
on the same day in the rate of interest accruing from and after such day on the
unpaid balance of principal of the Prime Rate Loans, if any, applicable to such
Interest Period, effective on the day of such change in the Prime Rate.

    PRIME RATE LOANS. Those Loans bearing interest calculated by reference to
the Prime Rate.

    PROSPECTUS. Collectively, the prospectus relating to the common stock of BPI
and included in the Registration Statement, and each preliminary prospectus
relating thereto.

    PROTECTED INTEREST RATE AGREEMENT. An agreement which evidences the interest
protection arrangements required by Section 8.16, and all extensions, renewals,
modifications, amendments, substitutions and replacements thereof

    RCRA. See Section 7.18.

    REAL ESTATE ASSETS. The fixed and tangible properties consisting of land,
buildings and/or other improvements owned or ground-leased by the Borrower or by
any other member of the BP Group (other than BPI, except for the property
located at 100 East Pratt Street, Baltimore, Maryland) at the relevant time of
reference thereto, including, without limitation, the Borrowing Base Properties
at such time of reference, but excluding all leaseholds other than (i)
University Place, Cambridge, Massachusetts and (ii) other leaseholds which are
subject to ground leases having an unexpired term of not less than (a) thirty
(30) years from the date hereof or (b) twenty-seven (27) years from the date
hereof if in connection with a so-called reverse like-kind exchange (in either
such event, which ground lease unexpired term will include only renewal options
exercisable

                                      -26-


solely at the ground lessee's option and, if exercisable prior to the Maturity
Date, so exercised). Notwithstanding the foregoing, (i) Real Estate Assets shall
also include each Approved Condominium Property, (ii) University Place SHALL NOT
be includable as a Borrowing Base Property if and so long as it remains subject
to a ground lease having an unexpired term of less than thirty (30) years from
the date hereof and (iii) 399 Park Avenue SHALL be includable as a Borrowing
Base Property if and so long as it remains subject to a ground lease having an
unexpired term of not less than twenty seven (27) years from the date hereof.

    REAL ESTATE ASSETS UNDER DEVELOPMENT. Any Real Estate Assets for which the
Borrower, any of the Borrower's Subsidiaries or any Partially-Owned Entity is
actively pursuing construction of one or more Buildings or other improvements
and for which construction is proceeding to completion without undue delay from
Permit denial, construction delays or otherwise, all pursuant to such Person's
ordinary course of business, PROVIDED that any such Real Estate Asset (or, if
applicable, any Building comprising a portion of any such Real Estate Asset)
will no longer be considered a Real Estate Asset Under Development when a
certificate of occupancy has issued for such Real Estate Asset (or Building) or
such Real Estate Asset (or Building) may otherwise be lawfully occupied for its
intended use. Notwithstanding the foregoing, tenant improvements (where
available) to previously constructed and/or leased Real Estate Assets shall not
be considered Real Estate Assets Under Development.

    RECORD. The grid attached to any Note, or the continuation of such grid, or
any other similar record, including computer records, maintained by any Bank
with respect to any Loan.

    RECOURSE. With reference to any obligation or liability, any liability or
obligation that is not Without Recourse to the obligor thereunder, directly or
indirectly. For purposes hereof, a Person shall not be deemed to be "indirectly"
liable for the liabilities or obligations of an obligor solely by reason of the
fact that such Person has an ownership interest in such obligor, PROVIDED that
such Person is not otherwise legally liable, directly or indirectly, for such
obligor's liabilities or obligations (e.g., by reason of a guaranty or
contribution obligation, by operation of law or by reason of such Person being a
general partner of such obligor).

    REFINANCING MORTGAGE. See Section 8.12.

    REGISTRATION STATEMENT. The registration statement on Form S-11 (File No.
333-25279) with respect to the common stock of BPI, which became effective in
June, 1997.

    REIMBURSEMENT OBLIGATION. The Borrower's obligation to reimburse the Banks
and the Agent on account of any drawing under any Letter of Credit as provided
in Section 3.2. Notwithstanding the foregoing, unless the Borrower shall notify
the Agent of its intent to repay the Reimbursement Obligation on the date of the
related drawing under any Letter

                                      -27-


of Credit as provided in Section 3.2 and such Reimbursement Obligation is in
fact paid by the Borrower on such date, such Reimbursement Obligation shall
simultaneously with such drawing be converted to and become a Prime Rate Loan as
set forth in Section 3.3.

    REIT. A "real estate investment trust", as such term is defined in Section
856 of the Code.

    RELEASE. See Section 7.18(c)(iii).

    REQUIRED BANKS. As of any date, the Banks whose aggregate Commitments
constitute at least sixty-six and two-thirds percent (66-2/3%) of the Total
Commitment (or, if the Commitments have been terminated, the Banks whose
aggregate Commitments, immediately prior to such termination, constituted at
least sixty-six and two-thirds percent (66-2/3%) of the Total Commitment).

    REVOLVING CREDIT LOAN(S). Each and every revolving credit loan made or to be
made or deemed made by the Banks to the Borrower pursuant to Section 2 or
Section 3.3, and excluding, in any event all Swingline Loans and all Bid Rate
Loans.

    REVOLVING CREDIT NOTES. Collectively, the separate promissory notes of the
Borrower in favor of each Bank in substantially the form of EXHIBIT A hereto, in
an aggregate principal amount equal to $605,000,000 or such greater amount to
which the Total Commitment is increased pursuant to Section 2.10, dated as of
the date hereof or as of such later date as any Person becomes a Bank under this
Agreement, and completed with appropriate insertions, as each of such notes may
be amended and/or restated from time to time.

    S&P. Standard & Poor's Ratings Group, a division of McGraw-Hill, Inc., and
its successors.

    SARA. See Section 7.18.

    SEC. The Securities and Exchange Commission, or any successor thereto.

    SEC FILINGS. Collectively, (i) the Registration Statement, (ii) the
Prospectus, (iii) each so-called follow-on prospectus filed by BPI with the SEC
from time to time, (v) each Form 10-K and Form 8-K filed by BPI with the SEC
from time to time and (vi) each of the other public forms and reports filed by
BPI with the SEC from time to time.

    SECURED CONSOLIDATED TOTAL INDEBTEDNESS. As of any date of determination,
the aggregate principal amount of Consolidated Total Indebtedness of the
Borrower and its Subsidiaries outstanding at such date secured by a Lien
evidenced by a mortgage, deed of trust or other similar security instrument on
properties or other assets of the Borrower or its Subsidiaries, without regard
to Recourse.

                                      -28-


    SUBSIDIARY. Any corporation, association, partnership, limited liability
company, trust, joint venture or other business entity which is required to be
consolidated with the Borrower or BPI in accordance with GAAP.

    SWINGLINE COMMITMENT. The obligation of the Swingline Lender to make
Swingline Loans to the Borrower in a maximum principal amount not exceeding at
any time $60,000,000.

    SWINGLINE LENDER. Fleet, in its capacity as swingline lender hereunder, or
any Eligible Assignee of Fleet who executes an Assignment and Assumption
assuming Fleet's obligations as Swingline Lender.

    SWINGLINE LOANS. Collectively, the loans in the maximum aggregate principal
amount of the Swingline Commitment made or to be made by the Swingline Lender to
the Borrower pursuant to Section 2.8 and subject to the limitations contained
herein and with each such Swingline Loan bearing interest at a per annum rate
equal to the Prime Rate.

    SWINGLINE LOAN AMOUNT. See Section 2.8(b).

    SWINGLINE NOTE. The promissory note substantially in the form of Exhibit A-1
hereto which evidences the Swingline Loans.

    SWINGLINE TERMINATION DATE. The date which is no later than the 15th day
preceding the Maturity Date.

    TOTAL COMMITMENT. As of any date, the sum of the then current Commitments of
the Banks. As of the Closing Date, the Total Commitment (including the Swingline
Commitment) is $605,000,000. After the Closing Date, the aggregate amount of the
Total Commitment (including the Swingline Commitment) may be increased to an
amount not exceeding $805,000,000, PROVIDED that such Increase is in accordance
with the provisions of Section 2.10.

    TYPE. As to any Revolving Credit Loan, its nature as a Prime Rate Loan or a
Eurodollar Rate Loan.

    UNANIMOUS BANK APPROVAL. The written consent of each Bank that is a party to
this Agreement at the time of reference.

    UNENCUMBERED ASSET. Any Real Estate Asset that on any date of determination
is not subject to any Liens (excluding (i) any such Lien imposed by the
organizational documents of the owner of such asset relating solely to a
restriction on the timing of any sale or refinancing of such Real Estate Asset
which does not materially and adversely

                                      -29-


affect the value of such Real Estate Asset and with respect to which the Agent
has been specifically notified, and (ii) any Permitted Liens).

    UNIFORM CUSTOMS. With respect to any Letter of Credit, the Uniform Customs
and Practice for Documentary Credits (1993 Revision), International Chamber of
Commerce Publication No. 500, or any successor version thereof adopted by the
Agent in the ordinary course of its business as a letter of credit issuer and in
effect at the time of issuance of such Letter of Credit.

    UNSECURED CONSOLIDATED TOTAL INDEBTEDNESS. As of any date of determination,
the aggregate principal amount of Consolidated Total Indebtedness of the
Borrower and its Subsidiaries outstanding at such date (including, without
limitation, all the Obligations under this Agreement as of such date), that is
not secured by a Lien evidenced by a mortgage, deed of trust or other similar
security interest.

    UNRESTRICTED CASH AND CASH EQUIVALENTS. As of any date of determination, the
sum of (a) the aggregate amount of unrestricted cash then actually held by the
Borrower or any of its Subsidiaries (excluding without limitation, until
forfeited or otherwise entitled to be retained by the Borrower or any of its
Subsidiaries, tenant security and other restricted deposits) and (b) the
aggregate amount of unrestricted cash equivalents (valued at fair market value)
then held by the Borrower or any of its Subsidiaries. As used in this
definition, (i) "unrestricted" means the specified asset is not subject to any
Liens in favor of any Person, PROVIDED that, in any event, cash held in a
designated hotel account which is required to be used by the Borrower or any
Subsidiary in connection with such hotel shall be deemed to be unrestricted
cash, and (ii) "cash equivalents" means that such asset has a liquid, par value
in cash and is convertible to cash on demand. Notwithstanding anything contained
herein to the contrary, the term Unrestricted Cash and Cash Equivalents shall
not include the Commitments of the Banks to make Loans or to make any other
extension of credit under this Agreement.

    WHOLLY-OWNED SUBSIDIARY. Any Subsidiary which the Borrower shall at all
times own directly or indirectly (through a Subsidiary or Subsidiaries) at least
a majority (by number of votes or controlling interests) of the outstanding
voting interests and ninety-nine percent (99%) of the economic interests. For
purposes of this definition, (i) with respect to any Subsidiary of the Borrower
which is a Massachusetts nominee trust, references to such Subsidiary shall be
deemed to be references to the beneficiary or beneficiaries of such nominee
trust, and (ii) BPLP shall not be permitted to be released from its Obligations
as a Borrower hereunder, notwithstanding any provision of Section 8.14.

    "WITHOUT RECOURSE" or "WITHOUT RECOURSE". With reference to any obligation
or liability, any obligation or liability for which the obligor thereunder is
not liable or obligated other than as to its interest in a designated Real
Estate Asset or other specifically identified asset only, subject to such
limited exceptions to the non-recourse nature of such obligation or liability,
such as, but not limited to, fraud, misappropriation,

                                      -30-


misapplication and environmental indemnities, as are usual and customary in like
transactions involving institutional lenders at the time of the incurrence of
such obligation or liability.

    Section 1.2.   RULES OF INTERPRETATION.

                        (i)    A reference to any document or agreement shall
                   include such document or agreement as amended, modified or
                   supplemented from time to time in accordance with its terms
                   or the terms of this Agreement.

                        (ii)   The singular includes the plural and the plural
                   includes the singular.

                        (iii)  A reference to any law includes any amendment or
                   modification to such law.

                        (iv)   A reference to any Person includes its permitted
                   successors and permitted assigns.

                        (v)    Accounting terms not otherwise defined herein
                   have the meanings assigned to them by generally accepted
                   accounting principles applied on a consistent basis by the
                   accounting entity to which they refer.

                        (vi)   The words "include", "includes" and "including"
                   are not limiting.

                        (vii)  All terms not specifically defined herein or by
                   generally accepted accounting principles, which terms are
                   defined in the Uniform Commercial Code as in effect in
                   Massachusetts, have the meanings assigned to them therein.

                        (viii) Reference to a particular "Section " refers to
                   that section of this Agreement unless otherwise indicated.

                        (ix)   The words "herein", "hereof", "hereunder" and
                   words of like import shall refer to this Agreement as a whole
                   and not to any particular section or subdivision of this
                   Agreement.

    Section 2.     THE REVOLVING CREDIT FACILITY.

    Section 2.1    COMMITMENT TO LEND. Subject to the provisions of Section 2.4
and the other terms and conditions set forth in this Agreement, each of the
Banks severally agrees to lend to the Borrower, and the Borrower may borrow,
repay, and reborrow from each Bank from time to time between the Closing Date
and the Maturity Date upon notice by the

                                      -31-


Borrower to the Agent (with copies to the Agent for each Bank) given in
accordance with Section 2.4, such sums as are requested by the Borrower up to a
maximum aggregate principal amount outstanding (after giving effect to all
amounts requested) at any one time equal to such Bank's Commitment MINUS,
without double counting, an amount equal to such Bank's Commitment Percentage
MULTIPLIED BY the sum of (x) the outstanding principal amount of all Swingline
Loans and Bid Rate Loans PLUS (y) all Reimbursement Obligations to the extent
not yet deemed Revolving Credit Loans pursuant to Section 3.3 and the Maximum
Drawing Amount; PROVIDED that the sum of the outstanding amount of the Revolving
Credit Loans (after giving effect to all amounts requested), PLUS the Maximum
Drawing Amount and, without double-counting the portion, if any, of any Letter
of Credit which is drawn and included in the Revolving Credit Loans or the
Maximum Drawing Amount, all outstanding Reimbursement Obligations, PLUS all
outstanding Swingline Loans, PLUS all outstanding Bid Rate Loans, shall not at
any time exceed the lesser of (i) the Total Commitment and (ii) the Borrowing
Base Availability at such time, and PROVIDED, FURTHER, that at the time the
Borrower requests a Revolving Credit Loan and after giving effect to the making
thereof: (i) in the case of any borrowing, all of the conditions in Section 13
(and in the case of any initial borrowing or other extension of credit on the
Closing Date, also the conditions in Section 12) have been met at the time of
such request, and (ii) there has not occurred and is not continuing (or will not
occur by reason thereof) any Default or Event of Default; it being acknowledged
and agreed that the Borrower shall be permitted to request and borrow Loans if a
Non-Material Breach (rather than a Default or Event of Default) exists, PROVIDED
that in the event that such Non-Material Breach relates to a Real Estate Asset
forming part of the Borrowing Base at such time, such Real Estate Asset shall be
excluded from the calculation of Borrowing Base Availability for all purposes in
the compliance certificate accompanying any Completed Loan Request.

    The Revolving Credit Loans shall be made PRO RATA in accordance with each
Bank's Commitment Percentage. Each request for a Revolving Credit Loan made
pursuant to Section 2.4 shall constitute a representation and warranty by the
Borrower that the conditions set forth in Section 12 have been satisfied (except
to the extent any such condition has been waived and/or deferred in writing by
the Agent and the required number of Banks) as of the Closing Date and that the
conditions set forth in Section 13 have been satisfied (except to the extent any
such condition has been waived and/or deferred in writing by the Agent and the
required number of Banks) on the date of such request and will be satisfied
(except to the extent any such condition has been waived and/or deferred in
writing by the Agent and the required number of Banks) on the proposed Drawdown
Date of the requested Loan or issuance of Letter of Credit, as the case may be,
PROVIDED that the making of such representation and warranty by the Borrower
shall not limit the right of any Bank not to lend if such conditions have not
been met. No Revolving Credit Loan or other extension of credit shall be
required to be made by any Bank unless (in connection with the initial Revolving
Credit Loan or Letter of Credit or other extension of credit) all of the
conditions contained in Section 12 have been satisfied (except to the extent any
such condition has been waived and/or deferred in writing by the Agent and the
required

                                      -32-


number of Banks) as of the Closing Date and unless all of the conditions set
forth in Section 13 have been met at the time of any request for a Revolving
Credit Loan or other extension of credit (except to the extent any such
condition has been waived and/or deferred in writing by the Agent and the
required number of Banks).

    Section 2.2.   THE REVOLVING CREDIT NOTES. The Revolving Credit Loans shall
be evidenced by the Revolving Credit Notes. A Revolving Credit Note shall be
payable to the order of each Bank in an aggregate principal amount equal to such
Bank's Commitment. The Borrower irrevocably authorizes each Bank to make or
cause to be made, at or about the time of the Drawdown Date of any Revolving
Credit Loan or at the time of receipt of any payment of principal on such Bank's
Revolving Credit Notes, an appropriate notation on such Bank's applicable Note
Record reflecting the making of such Revolving Credit Loan or (as the case may
be) the receipt of such payment. The outstanding amount of the Revolving Credit
Loans set forth on such applicable Note Record shall be PRIMA FACIE evidence of
the principal amount thereof owing and unpaid to such Bank, but the failure to
record, or any error in so recording, any such amount on such Note Record shall
not limit or otherwise affect the rights and obligations of the Borrower
hereunder or under any Revolving Credit Note to make payments of principal of or
interest on any Revolving Credit Note when due.

    Section 2.3.   INTEREST ON REVOLVING CREDIT LOANS; FEES.

                   (a) Each Prime Rate Loan shall bear interest for the period
commencing with the Drawdown Date thereof and ending on the last day of the
Interest Period with respect thereto (unless earlier paid in accordance with
Section 4.2) at a rate equal to the Prime Rate PLUS the Applicable Prime Rate
Margin.

                   (b) Each Eurodollar Rate Loan shall bear interest for the
period commencing with the Drawdown Date thereof and ending on the last day of
the Interest Period with respect thereto (unless earlier paid in accordance with
Section 4.2) at a rate equal to the Eurodollar Rate determined for such Interest
Period PLUS the Applicable Eurodollar Margin.

                   (c) The Borrower unconditionally promises to pay interest on
each Revolving Credit Loan in arrears on each Interest Payment Date with respect
thereto.

                   (d) The Borrower agrees to pay to the Agent, for the accounts
of the Banks in accordance with their respective Commitment Percentages, a
facility fee (the "Facility Fee") calculated at the rate, expressed in basis
points on the Total Commitment, which shall vary from time to time in
relationship to variances in the Debt Ratings as set forth in the following
table:

                                      -33-




    S&P                  Moody's                Facility Fee (bps)
    --------------       ------------           ------------------
                                          
    A-or above           A3 or above            15

    BBB+                 Baa1                   15

    BBB                  Baa2                   20

    BBB-                 Baa3                   20

    Below BBB- or        Below Baa3 or
    unrated              unrated                25


If the Debt Ratings from the two agencies referred to above are not equivalent,
the Facility Fee will be determined (i) based on the higher of the two Debt
Ratings if the lower Debt Rating is no more than one level lower than the higher
Debt Rating, and (ii) based on the average of the two Debt Ratings if the lower
Debt Rating is more than one level lower than the higher Debt Rating.
Adjustments in the Facility Fee based upon a change in a Debt Rating level shall
be effective on the first day following the change in such Debt Rating.

The Borrower shall notify the Agent in writing of any change in the Debt Rating
as and when such change occurs.

The Facility Fee shall be payable quarterly in arrears on the first Business Day
of each calendar quarter for the immediately preceding calendar quarter
commencing on the first such date following the Closing Date through the
Maturity Date, with a final payment on the Maturity Date.

    Section 2.4.   REQUESTS FOR REVOLVING CREDIT LOANS.

    The following provisions shall apply to each request by the Borrower for a
Revolving Credit Loan:

                            (i)   The Borrower shall submit a Completed Loan
                   Request to the Agent, together with a duplicate copy of such
                   Completed Loan Request for each Bank which is then a party to
                   this Agreement at the time such loan request is made. Such
                   Completed Loan Requests shall be delivered in separate
                   envelopes to the Agent and be addressed to the Agent and each
                   Bank, respectively, and each such envelope shall be
                   conspicuously marked with the following legend: "LOAN REQUEST
                   -- TIME SENSITIVE -- MUST RESPOND WITHIN [2/4] DAYS" and with
                   the appropriate period filled in. Except as otherwise
                   provided herein, each Completed Loan Request shall be in a
                   minimum amount of $1,000,000 or an integral multiple of
                   $100,000 in excess thereof. Each Completed Loan Request shall
                   be irrevocable and binding on the Borrower and shall obligate
                   the Borrower to accept the Revolving Credit Loans requested

                                      -34-


                   from the Banks on the proposed Drawdown Date, unless such
                   Completed Loan Request is withdrawn (x) in the case of a
                   request for a Eurodollar Rate Loan, at least four (4)
                   Business Days prior to the proposed Drawdown Date for such
                   Loan, and (y) in the case of a request for a Prime Rate Loan,
                   at least two (2) Business Days prior to the proposed Drawdown
                   Date for such Loan.

                            (ii)  Each Completed Loan Request shall be delivered
                   by the Borrower to the Agent by 10:00 a.m. on any Business
                   Day, and at least two (2) Business Days prior to the proposed
                   Drawdown Date of any Prime Rate Loan, and at least four (4)
                   Business Days prior to the proposed Drawdown Date of any
                   Eurodollar Rate Loan.

                            (iii) Each Completed Loan Request shall include a
                   completed writing in the form of EXHIBIT B hereto specifying:
                   (1) the principal amount of the Revolving Credit Loan
                   requested, (2) the proposed Drawdown Date of such Revolving
                   Credit Loan, (3) the Interest Period applicable to such
                   Revolving Credit Loan, and (4) the Type of such Revolving
                   Credit Loan being requested.

                            (iv)  No Bank shall be obligated to fund any
                   Revolving Credit Loan or issue any Letter of Credit unless:

                                  (a) a Completed Loan Request has been timely
                        received by the Agent as provided in subsection (i)
                        above; and

                                  (b) both before and after giving effect to the
                        Revolving Credit Loan to be made or Letter of Credit to
                        be issued pursuant to the Completed Loan Request, all of
                        the conditions contained in Section 12 shall have been
                        satisfied (to the extent such conditions have not been
                        waived and/or deferred in writing by the Agent and the
                        required number of Banks prior to the initial advance)
                        as of the Closing Date, with respect to the initial
                        advance only, and all of the conditions set forth in
                        Section 13 shall have been met, including, without
                        limitation, the condition under Section 13.1 that there
                        be no Default or Event of Default under this Agreement;
                        and

                                  (c) the Agent shall have received (with copies
                        to the Agent for each Bank) a certificate in the form of
                        EXHIBIT C-1 hereto signed by the chief financial
                        officer, treasurer or controller of the Borrower setting
                        forth computations evidencing compliance with the
                        covenants contained in Section 10 on a PRO FORMA basis
                        after giving effect to such requested Revolving Credit
                        Loan (including, without limitation, a certification
                        that, to the best of the Borrower's

                                      -35-


                        knowledge, if the Borrowing Base Value and the Borrowing
                        Base Debt Service Coverage Ratio were to be calculated
                        on the Drawdown Date of any Revolving Credit Loan for
                        the period through the Drawdown Date rather than through
                        the last day of the most recently completed fiscal
                        quarter, there would be sufficient Borrowing Base
                        Availability for the requested Revolving Credit Loan),
                        and certifying that, both before and after giving effect
                        to such requested Revolving Credit Loan or Letter of
                        Credit, no Default or Event of Default exists or will
                        exist under this Agreement or any other Loan Document,
                        and that after taking into account such requested
                        Revolving Credit Loan or Letter of Credit, no Default or
                        Event of Default will exist as of the Drawdown Date.

                            (v) The Agent will use best efforts to cause the
                   Completed Loan Request to be delivered to each Bank on the
                   same day it is received by the Agent and will, absent
                   circumstances outside of its control, cause the Completed
                   Loan Request to be delivered to each Bank on the Business Day
                   following the day a Completed Loan Request is received by the
                   Agent.

    Section 2.5.   CONVERSION OPTIONS.

                   (a) The Borrower may elect from time to time to convert any
outstanding Revolving Credit Loan to a Revolving Credit Loan of another Type,
PROVIDED that (i) with respect to any such conversion of a Eurodollar Rate Loan
to a Prime Rate Loan, such conversion shall take place automatically at the end
of the applicable Interest Period unless the Borrower provides notice to the
Agent of its request to continue such Loan as a Eurodollar Rate Loan as provided
in Section 2.5(b) and Section 2.5(a)(ii); (ii) subject to the further proviso at
the end of this Section 2.5(a) and subject to Section 2.5(b) and Section 2.5(d),
with respect to any conversion of a Prime Rate Loan to a Eurodollar Rate Loan
(or a continuation of a Eurodollar Rate Loan, as provided in Section 2.5(b)),
the Borrower shall give the Agent (with copies to the Agent for each Bank) at
least four (4) Eurodollar Business Days' prior written notice of such election,
which such notice must be received by the Agent by 10:00 a.m. on any Business
Day; and (iii) no Loan may be converted into a Eurodollar Rate Loan when any
Default or Event of Default has occurred and is continuing. All or any part of
outstanding Revolving Credit Loans of any Type may be converted as provided
herein, PROVIDED that each Conversion Request relating to the conversion of a
Prime Rate Loan to a Eurodollar Rate Loan shall be for an amount equal to
$1,000,000 or an integral multiple of $100,000 in excess thereof and shall be
irrevocable by the Borrower.

                   (b) Any Revolving Credit Loan of any Type may be continued as
such upon the expiration of the Interest Period with respect thereto (i) in the
case of Prime Rate Loans, automatically and (ii) in the case of Eurodollar Rate
Loans by compliance by the Borrower with the notice provisions contained in
Section 2.5(a)(ii); PROVIDED that no Eurodollar

                                      -36-


Rate Loan may be continued as such when any Default or Event of Default has
occurred and is continuing but shall be automatically converted to a Prime Rate
Loan on the last day of the first Interest Period relating thereto ending during
the continuance of any Default or Event of Default. The Borrower shall notify
the Agent promptly when any such automatic conversion contemplated by this
Section 2.5(b) is scheduled to occur.

                   (c) In the event that the Borrower does not notify the Agent
of its election hereunder with respect to any Revolving Credit Loan, such Loan
shall be automatically converted to a Prime Rate Loan at the end of the
applicable Interest Period.

                   (d) The Borrower may not request or elect a Eurodollar Rate
Loan pursuant to Section 2.4, elect to convert a Prime Rate Loan to a Eurodollar
Loan pursuant to Section 2.5(a) or elect to continue a Eurodollar Rate Loan
pursuant to Section 2.5(b) if, after giving effect thereto, there would be
greater than six (6) Eurodollar Rate Loans then outstanding. Any Loan Request or
Conversion Request for a Eurodollar Rate Loan that would create greater than six
(6) Eurodollar Rate Loans outstanding shall be deemed to be a Loan Request or
Conversion Request for a Prime Rate Loan. By way of explanation of the
foregoing, in the event that the Borrower wishes to convert or continue two or
more Loans into one Eurodollar Rate Loan on the same day and for identical
Interest Periods (or borrow an additional Revolving Credit Loan simultaneously
with converting or continuing a Revolving Credit Loan for identical Interest
Periods), such Eurodollar Rate Loan shall constitute one single Eurodollar Rate
Loan for purposes of this clause (d).

    Section 2.6.   FUNDS FOR REVOLVING CREDIT LOANS.

                   (a) Subject to the other provisions of this Section 2, not
later than 11:00 a.m. (Boston time) on the proposed Drawdown Date of any
Revolving Credit Loan, each of the Banks will make available to the Agent, at
its Head Office, in immediately available funds, the amount of such Bank's
Commitment Percentage of the amount of the requested Revolving Credit Loan. Upon
receipt from each Bank of such amount, the Agent will make available to the
Borrower the aggregate amount of such Revolving Credit Loan made available to
the Agent by the Banks. All such funds received by the Agent by 11:00 a.m.
(Boston Time) on any Business Day will be made available to the Borrower not
later than 2:00 p.m. on the same Business Day; funds received after such time
will be made available by not later than 11:00 a.m. on the next Business Day
(provided that as to any Bank which is required to fund Revolving Credit Loans
from its head office located in the Pacific Time Zone (U.S.), the preceding
reference to `11:00 a.m.' shall be deemed to be a reference to `1:00 p.m.'). The
failure or refusal of any Bank to make available to the Agent at the aforesaid
time and place on any Drawdown Date the amount of its Commitment Percentage of
the requested Revolving Credit Loan shall not relieve any other Bank from its
several obligation hereunder to make available to the Agent the amount of its
Commitment Percentage of any requested Revolving Credit Loan but in no event
shall the Agent (in its capacity as Agent) have any obligation to make any
funding or shall any Bank be obligated to fund more than its Commitment
Percentage of the

                                      -37-


requested Revolving Credit Loan or to increase its Commitment Percentage on
account of such failure or otherwise.

                   (b) The Agent may, unless notified to the contrary by any
Bank prior to a Drawdown Date, assume that such Bank has made available to the
Agent on such Drawdown Date the amount of such Bank's Commitment Percentage of
the Revolving Credit Loan to be made on such Drawdown Date, and the Agent may
(but it shall not be required to), in reliance upon such assumption, make
available to the Borrower a corresponding amount. If any Bank makes available to
the Agent such amount on a date after such Drawdown Date, such Bank shall pay to
the Agent on demand an amount equal to the product of (i) the average, computed
for the period referred to in clause (iii) below, of the weighted average
interest rate paid by the Agent for federal funds acquired by the Agent during
each day included in such period, MULTIPLIED BY (ii) the amount of such Bank's
Commitment Percentage of such Revolving Credit Loan, MULTIPLIED BY (iii) a
fraction, the numerator of which is the number of days that elapsed from and
including such Drawdown Date to the date on which the amount of such Bank's
Commitment Percentage of such Revolving Credit Loan shall become immediately
available to the Agent, and the denominator of which is 365. A statement of the
Agent submitted to such Bank with respect to any amounts owing under this
paragraph shall be PRIMA FACIE evidence of the amount due and owing to the Agent
by such Bank.

    Section 2.7.   REDUCTION OF COMMITMENT. The Borrower shall have the right at
any time and from time to time upon five (5) Business Days' prior written notice
to the Agent (with copies to the Agent for each Bank) to reduce by $500,000 or
an integral multiple thereof or terminate entirely the unborrowed portion of the
then Total Commitment, whereupon the Commitments of the Banks shall be reduced
PRO RATA in accordance with their respective Commitment Percentages by the
amount specified in such notice or, as the case may be, terminated. Upon the
effective date of any such reduction or termination, the Borrower shall pay to
the Agent for the respective accounts of the Banks the full amount of the
Facility Fee then accrued and unpaid on the amount of the reduction. No
reduction or termination of the Commitments may be reinstated.

    Section 2.8.   SWINGLINE LOANS.

                   (a) AVAILABILITY. Subject to the terms and conditions of this
Agreement and so long as the Swingline Lender does not have knowledge that any
Default or Event of Default exists or will exist after giving effect to the
applicable Swingline Loan, and the Borrower has delivered to the Agent a loan
request, including the certificate referred to in Section 2.4(iv)(c), as if all
references in Section 2.4(iv)(c) to Revolving Credit Loans were to Swingline
Loans, the Swingline Lender agrees to make Swingline Loans to the Borrower from
time to time from the Closing Date to, but not including, the Swingline
Termination Date; PROVIDED, that the aggregate principal amount of all
outstanding Swingline Loans (after giving effect to any amount requested) at any
time, shall not exceed the lesser of (i) the Total Commitment in effect at such
time LESS the sum

                                      -38-


of (A) all outstanding Revolving Credit Loans at such time (after giving effect
to all amounts requested), (B) the Maximum Drawing Amount and, without
double-counting the portion, if any, of any Letter of Credit which is drawn and
included in the Revolving Credit Loans or the Maximum Drawing Amount, all
outstanding Reimbursement Obligations at such time, and (C) all outstanding Bid
Rate Loans at such time, (ii) the Borrowing Base Availability at such time and
(iii) the Swingline Commitment at such time. Swingline Loans hereunder may be
used in anticipation of borrowing Revolving Credit Loans, Bid Rate Loans and for
other short-term requirements and shall be repaid in accordance with the terms
hereof. Each Swingline Loan must be for an amount equal to at least $1,000,000
and in an integral multiple of $100,000 and shall be evidenced by the Swingline
Note. The Swingline Lender shall initiate the transfer of funds representing the
Swingline Loan to the Borrower by 4:00 p.m. (Boston time) on the Business Day of
the requested borrowing, so long as the Swingline Loan has been requested by the
Borrower no later than 1:00 p.m. (Boston time) on such Business Day. In no event
shall the number of Swingline Loans outstanding at any time exceed three (3).
All Swingline Loans shall bear interest at the Prime Rate plus the Applicable
Prime Rate Margin. The Borrower unconditionally promises to pay interest on each
Swingline Loan in arrears on each Interest Payment Date with respect thereto.

                   (b) REPAYMENT. The Borrower hereby absolutely and
unconditionally promises to repay the outstanding principal amount of each
Swingline Loan and all accrued interest and charges thereon (the "Swingline Loan
Amount") on the earliest to occur of: (i) the fifth (5th) Business Day after the
date on which the Swingline Loan is advanced or (ii) the Swingline Termination
Date; PROVIDED, the Borrower shall have the right to prepay Swingline Loans
without penalty or any prepayment charge.

                   (c) REFUNDING AND CONVERSION OF SWINGLINE LOANS TO REVOLVING
CREDIT LOANS.

                       (i)   On the maturity of each Swingline Loan (which shall
be no longer than the period for repayment set forth above in Section 2.8(b)),
the Borrower shall be deemed to have requested on such date a Revolving Credit
Loan comprised solely of a Prime Rate Loan in a principal amount equal to the
Swingline Loan Amount in order to repay such Swingline Loan. Such refundings of
the Swingline Loan through the funding of such Revolving Credit Loans shall be
made by the Banks in accordance with their respective Commitment Percentages and
shall thereafter be reflected as Revolving Credit Loans of the Banks on the
books and records of the Agent.

                       (ii)  If a Default or an Event of Default has occurred
and is continuing, all Swingline Loans shall be refunded by the Banks on demand
by the Swingline Lender, in which case the Borrower shall be deemed to have
requested on such date of demand a Revolving Credit Loan comprised solely of a
Prime Rate Loan in a principal amount equal to the Swingline Loan Amount for
such Swingline Loans. Such refundings of the Swingline Loans through the funding
of such Revolving Credit Loans

                                      -39-


shall be made by the Banks in accordance with their respective Commitment
Percentages and shall thereafter be reflected as Revolving Credit Loans of the
Banks on the books and records of the Agent.

                       (iii) Each Bank shall fund its respective Commitment
Percentage of Revolving Credit Loans as required to so repay Swingline Loans
outstanding to the Swingline Lender upon such deemed request or demand by the
Swingline Lender but in no event later than 2:00 p.m. (Boston time) on the next
succeeding Business Day after such deemed request or demand is made. No Bank's
obligation to fund its respective Commitment Percentage of the repayment of a
Swingline Loan shall be affected by any other Bank's failure to fund its
Commitment Percentage of such repayment, nor shall any Bank's Commitment
Percentage be increased as a result of any such failure of any other Bank to
fund its Commitment Percentage. To the extent any Bank does not fund its
respective Commitment Percentage of any Revolving Credit Loan to the Borrower
pursuant to this Section 2.8(c)(iii), such Bank shall be deemed a Delinquent
Bank and the Borrower shall repay such amounts to the Swingline Lender in
accordance with the provisions of Section 4.3 as if such Loan were a Revolving
Credit Loan for which a Bank did not remit its share to the Agent. If any
portion of any such amount paid to the Swingline Lender shall be recovered by or
on behalf of the Borrower from the Swingline Lender in bankruptcy or otherwise,
the loss of the amount so recovered shall be ratably shared among all the Banks.

                       (iv)  If at any time the Borrower receives notice from
the Swingline Lender that the aggregate principal amount of all Revolving Credit
Loans outstanding, PLUS the aggregate principal amount of all Swingline Loans
outstanding (including the Swingline Loan for which demand for payment is then
made by the Swingline Lender pursuant to this subsection), PLUS the Maximum
Drawing Amount and, PLUS, without double-counting the portion, if any, of any
Letter of Credit which is drawn and included in the Revolving Credit Loans or
the Maximum Drawing Amount, all outstanding Reimbursement Obligations at such
time, PLUS all outstanding Bid Rate Loans at such time, equals or exceeds the
lesser of (A) Total Commitment at such time and (B) the Borrowing Base
Availability at such time, the Borrower shall repay the amount of such excess
upon demand by the Swingline Lender, which payment shall be applied first to the
Swingline Loans, second to the Revolving Credit Loans and thereafter to the Bid
Rate Loans.

                       (v)   Each Bank acknowledges and agrees that its
obligation to refund Swingline Loans with Revolving Credit Loans in accordance
with the terms of this Section 2.8 is absolute and unconditional and shall not
be affected by any circumstance whatsoever, including, in any event,
non-satisfaction of any conditions set forth in this Agreement pertaining to
advances of Revolving Credit Loans hereunder, except to the limited extent
expressly referred to in the first sentence of Section 2.8(a). Further, each
Bank agrees and acknowledges that if, prior to the refunding of any outstanding
Swingline Loans pursuant to this Section 2.8, one of the events described in
Sections 14.1(g) or (h) shall have

                                      -40-


occurred, each Bank will, on the date the applicable Revolving Credit Loan would
have been made pursuant to Section 2.8(c)(i) or (ii), purchase an undivided
participating interest in the Swingline Loan to be refunded in an amount equal
to its Commitment Percentage of such Swingline Loan Amount. Each Bank will
immediately transfer to the Swingline Lender, in immediately available funds,
the amount of its participation. Whenever, at any time after the Swingline
Lender has received from any Bank such Bank's participating interest in a
Swingline Loan, the Swingline Lender receives any payment on account thereof,
the Swingline Lender will distribute to such Bank its participating interest in
such amount (appropriately adjusted, in the case of interest payments, to
reflect the period of time during which such Bank's participating interest was
outstanding and funded).

                       (vi)  Each Bank's Commitment Percentage applicable to any
Swingline Loan shall be identical to its Commitment Percentage applicable to
Revolving Credit Loans.

    Section 2.9.   BID RATE ADVANCES.

                   (a) Each Bank severally agrees that, on the terms and
conditions set forth in this Agreement, the Borrower may request and receive Bid
Rate Advances under this Section 2.9 from time to time on any Business Day
during the period from the date hereof until the date occurring 30 days prior to
the Maturity Date in the manner set forth below; PROVIDED, HOWEVER, that:

                       (i)   following the making of each Bid Rate Advance, the
                   aggregate principal amount of all Revolving Credit Loans then
                   outstanding, PLUS the aggregate amount of all Swingline Loans
                   then outstanding, PLUS the aggregate amount of all Bid Rate
                   Advances then outstanding (including the requested Bid Rate
                   Advance), PLUS the Maximum Drawing Amount and, without
                   double-counting the portion, if any, of any Letter of Credit
                   which is drawn and included in the Revolving Credit Loans or
                   the Maximum Drawing Amount, PLUS all outstanding
                   Reimbursement Obligations at such time, shall not exceed the
                   lesser of (A) the Total Commitment in effect at such time or
                   (B) the Borrowing Base Availability in effect at such time;

                       (ii)  at no time shall the aggregate amount of all Bid
                   Rate Advances then outstanding (including the requested Bid
                   Rate Advance) exceed the Bid Rate Maximum Amount; and

                       (iii) at the time the Borrower requests a Bid Rate
                   Advance and after giving effect to the making thereof, no
                   Default or Event of Default has occurred and is continuing.

                                      -41-


                   (b) The procedures for the solicitation and acceptance of Bid
Rate Loans are set forth below (with the references to time of day meaning
Boston, Massachusetts time):

                       (i)   The Borrower may request a Bid Rate Advance under
                   this Section 2.9(b) by giving the Agent irrevocable notice,
                   in the form attached hereto as Exhibit D-2 (a "Bid Rate
                   Advance Borrowing Notice"), specifying the date and aggregate
                   amount of the proposed Bid Rate Advance, the maturity date
                   for repayment of each Bid Rate Loan to be made as part of
                   such Bid Rate Advance (which maturity date may not be earlier
                   than, in the case of an Absolute Rate Auction, the date
                   occurring one day, and in the case of an Indexed Rate
                   Auction, the date occurring seven days, after the date of the
                   related Bid Rate Advance or later than, in either case, the
                   earlier of the day occurring 180 days after the date of such
                   Bid Rate Advance and the Maturity Date), and any other terms
                   to be applicable to such Bid Rate Advance, not later than
                   11:00 a.m. (A) in the case of an Absolute Rate Auction, one
                   (1) Business Day prior to the date of the proposed Bid Rate
                   Advance, and (B) in the case of an Indexed Rate Auction, four
                   (4) Business Days prior to the date of the proposed Bid Rate
                   Advance. The Agent shall, promptly following its receipt of a
                   Bid Rate Advance Borrowing Notice under this Section 2.9(b),
                   notify each Bank of such request by sending such Bank a copy
                   of such Bid Rate Advance Borrowing Notice.

                       (ii)  Each Bank may, if, in its sole discretion, it
                   elects to do so, irrevocably offer to make one or more Bid
                   Rate Loans to the Borrower as part of such proposed Bid Rate
                   Advance at a rate or rates of interest specified by such Bank
                   in its sole discretion, by providing written notice to the
                   Agent (which shall give prompt notice thereof to the
                   Borrower), before 12:00 p.m. (or if such Bank is serving as
                   the Agent, before 11:30 a.m.) on (A) the date of such
                   proposed Bid Rate Advance, in the case of an Absolute Rate
                   Auction, and (B) the date that is three Business Days before
                   the date of such proposed Bid Rate Advance, in the case of an
                   Indexed Rate Auction, in the form of Exhibit D-3 attached
                   hereto (the "Competitive Bid Notice") of the minimum amount
                   and maximum amount of each Bid Rate Loan which such Bank
                   would be willing to make as part of such proposed Bid Rate
                   Advance (which amounts may, subject to the proviso to the
                   first sentence of Section 2.9(a), exceed such Bank's
                   Commitment) and the rate or rates of interest therefor.

                       Any Competitive Bid Notice shall be disregarded and given
                   no effect if it contains qualifying or conditional language,
                   proposes terms and conditions other than or in addition to
                   those set forth in the applicable Bid

                                      -42-


                   Rate Advance Borrowing Notice or arrives after the time set
                   forth above for its receipt by the Agent.

                       (iii) The Borrower shall, in turn, before (A) 1:00 p.m.
                   on the date of such proposed Bid Rate Advance, in the case of
                   an Absolute Rate Auction, and (B) 1:00 p.m. three Business
                   Days before the date of such proposed Bid Rate Advance, in
                   the case of an Indexed Rate Auction, either:

                             (x) cancel such Bid Rate Advance by giving the
                       Agent notice to that effect, or

                             (y) accept one or more of the offers made by any
                       Bank or Banks pursuant to Section 2.9(b), in its sole
                       discretion and subject to Section 2.9(d), by giving
                       notice, in the form of EXHIBIT D-4 attached hereto, to
                       the Agent of the amount of each Bid Rate Loan to be made
                       by each Bank as part of such Bid Rate Advance, and reject
                       any remaining offers made by Banks pursuant to Section
                       2.9(b)(ii) by giving the Agent notice to that effect.

                       (iv)  If the Borrower notifies the Agent that such Bid
                   Rate Advance is canceled pursuant to Section 2.9(b)(iii)(x)
                   above, the Agent shall give prompt notice thereof to the
                   Banks and such Bid Rate Advance shall not be made.

                       (v)   If the Borrower accepts one or more of the offers
                   made by any Bank or Banks pursuant to Section 2.9(b)(iii)(y),
                   the Agent shall in turn promptly notify (A) each Bank that
                   has made an offer as described in Section 2.9(b)(ii) of the
                   date, and aggregate amount of such Bid Rate Advance and
                   whether or not any offer or offers made by such Bank pursuant
                   to Section 2.9(b)(ii) have been accepted by the Borrower and
                   (B) each Bank that is to make a Bid Rate Loan as part of such
                   Bid Rate Advance, of the amount of each Bid Rate Loan to be
                   made by such Bank as part of such Bid Rate Advance. Each Bank
                   that is to make a Bid Rate Loan as part of such Bid Rate
                   Advance shall, not later than the specified remittance time
                   (as set forth in the notice received from the Agent pursuant
                   to clause (B) of the preceding sentence) on the date of such
                   Bid Rate Advance specified in the notice received from the
                   Agent pursuant to clause (B) of the preceding sentence, make
                   available to the Agent such Bank's portion of such Bid Rate
                   Advance, in same day funds. After receipt by the Agent of
                   such funds and provided that the conditions in Section 13 are
                   satisfied and the Borrower has delivered to the Agent the
                   certificate referred to in Section 2.4(iv)(c) as if all
                   references in Section 2.4(iv)(c) to Revolving Credit Loans
                   were to Bid Rate Loans, the Agent will make such funds
                   available to the

                                      -43-


                   Borrower upon execution and delivery to the applicable Bank
                   (with a copy to the Agent) by the Borrower of a Bid Rate Note
                   evidencing such Bid Rate Loan (and the provisions set forth
                   in the last two sentences of Section 2.2 relating to
                   Revolving Credit Notes shall apply equally to the Bid Rate
                   Notes). Promptly after each Bid Rate Advance the Agent will
                   notify each Bank of the Bid Rate Advance.

                       (vi)  If the Borrower accepts one or more of the offers
                   made by any Bank or Banks pursuant to Section 2.9(b)(iii)(y)
                   and fails to borrow any Bid Rate Loan so accepted, the
                   Borrower shall indemnify the Bank funding such Loan against
                   any loss or expense incurred by reason of the liquidation or
                   reemployment of deposits or other funds acquired by such Bank
                   to fund or maintain such unborrowed Bid Rate Loans,
                   including, without limitation, Eurodollar Breakage Costs or
                   other compensation as provided in Section 5.8.

                       (vii) A Bid Rate Advance fee of $750.00 shall be payable
                   by the Borrower to the Agent, for the account of the Agent,
                   with respect to and concurrently with the delivery of each
                   Bid Rate Advance Borrowing Notice.

                   (c) Each Bid Rate Advance shall be in an aggregate amount not
less than $5,000,000 or an integral multiple of $1,000,000 in excess thereof,
and, following the making of each Bid Rate Advance, the Borrower shall be in
compliance with the limitation set forth in the proviso to Section 2.9(a).

                   (d) Each acceptance by the Borrower pursuant to Section
2.9(b)(iii)(y) of the offers made in response to a Bid Rate Advance Borrowing
Notice shall be treated as an acceptance of such offers in ascending order of
the rates or margins, as applicable, at which the same were made but if, as a
result thereof, two or more offers at the same such rate or margin would be
partially accepted, then the amounts of the Bid Rate Loans in respect of which
such offers are accepted shall be treated as being the amounts which bear the
same proportion to one another as the respective amounts of the Bid Rate Loans
so offered bear to one another but, in each case, rounded as the Agent may
consider necessary to ensure that the amount of each such Bid Rate Loan is
$5,000,000 or an integral multiple of $1,000,000 in excess thereof.

                   (e) Within the limits and on the conditions set forth in this
Section 2.9, the Borrower may from time to time borrow under this Section 2.9,
repay pursuant to Section 2.9(f), and reborrow under this Section 2.9.

                   (f) The Borrower hereby absolutely and unconditionally
promises to pay to the Agent for the account of each Bank which has made a Bid
Rate Loan to it, on the maturity date of such Bid Rate Loan (such maturity date
being that specified by the

                                      -44-


Borrower for repayment of such Bid Rate Loan in the related Bid Rate Advance
Borrowing Notice) or such earlier date to which the maturity of such Bid Rate
Loan has been accelerated hereunder, the then unpaid principal amount of such
Bid Rate Loan and all accrued but unpaid interest thereon. The Borrower shall
have no right to prepay any principal amount of any Bid Rate Loan unless, and
then only on the terms, specified by the Borrower for such Bid Rate Loan in the
related Bid Rate Advance Borrowing Notice and subject to payment of Eurodollar
Breakage Costs and Section 5.8.

                   (g) The Borrower shall, and hereby absolutely and
unconditionally promises to, pay interest on the unpaid principal amount of each
Bid Rate Loan made to it, from the date of such Bid Rate Loan to the date the
principal amount of such Bid Rate Loan is repaid in full, at the rate of
interest for such Bid Rate Loan specified by the Bank making such Bid Rate Loan
in the related notice submitted by such Bank pursuant to Section 2.9(b)(ii),
payable on the interest payment date or dates specified by the Borrower for such
Bid Rate Loan in the related Bid Rate Advance Borrowing Notice and on any date
on which such Bid Rate Loan is prepaid, whether by acceleration or otherwise,
and at maturity. In the event the term of any Bid Rate Loan shall be longer than
three months, interest thereon shall be payable not less frequently than once
each three-month period during such term. Interest on Bid Rate Loans shall be
calculated for actual days elapsed on the basis of a 360-day year.

    Section 2.10.  INCREASES IN TOTAL COMMITMENT. The Borrower shall have the
right to cause the Total Commitment to increase by an amount not at any time
exceeding $200,000,000 (the "Increase"), in which event the Agent will amend
SCHEDULE 2 to reflect the increased Commitment of each Bank, if any, that has
agreed in writing to an increase and to add any third party financial
institution that may have become a party to, and a "Bank" under, this Agreement
in connection with the Increase; PROVIDED, HOWEVER, that it shall be a condition
precedent to the effectiveness of the Increase that the Increase Conditions
shall have been satisfied. In the event that the Increase results in any change
to the Commitment Percentage of any Bank, then on the effective date of such
Increase in the Total Commitment (i) any new Bank, and any existing Bank whose
Commitment has increased, shall pay to the Agent such amounts as are necessary
to fund its new or increased Commitment Percentage of all existing Revolving
Credit Loans, (ii) the Agent will use the proceeds thereof to pay to all Banks
whose Commitment Percentage is decreasing such amounts as are necessary so that
each such Bank's participation in existing Revolving Credit Loans will be equal
to its adjusted Commitment Percentage, and (iii) if the effective date of such
Increase in the Total Commitment occurs on a date other than the last day of an
Interest Period applicable to any outstanding Eurodollar Rate Loan, the Borrower
will be responsible for Eurodollar Breakage Costs and any other amounts payable
pursuant to Section 5.8 on account of the payments made pursuant to clause (ii)
above.

                                      -45-


    Section 2.11.  EXTENSION OF REVOLVING CREDIT MATURITY DATE. At least 30 days
but in no event more than 90 days prior to January 17, 2006, the Borrower, by
written notice to the Agent (with copies for each Bank), may request an
extension of the Maturity Date by a period of one year from the Maturity Date
then in effect (the "Extension"). The Extension shall become effective on
January 17, 2006 so long as (i) the Borrower has paid to the Agent on such date,
for the ratable accounts of the Banks, an extension fee in an amount equal to 20
basis points on the Total Commitment in effect on such date, and (ii) no Default
or Event of Default has occurred and is continuing on such date and all
representations and warranties contained in the Loan Documents shall be true and
correct as of such date (except (i) to the extent of changes resulting from
transactions contemplated or not prohibited by this Agreement or the other Loan
Documents (including, without limitation, the fact that a Real Estate Asset may
cease to be a Borrowing Base Property pursuant to the terms of this Agreement)
and changes occurring in the ordinary course of business, (ii) to the extent
that such representations and warranties relate expressly to an earlier date and
(iii) to the extent otherwise represented by the Borrower with respect to the
representation set forth in Section 7.10). The notice referred to in the first
sentence of this Section 2.11 shall constitute and shall be deemed to be a
certification by the Borrower as to the truth and accuracy of the statements
contained in clause (ii) of the preceding sentence.

    Section 3.     LETTERS OF CREDIT.

    Section 3.1.   LETTER OF CREDIT COMMITMENTS.

                   Section 3.1.1. COMMITMENT TO ISSUE LETTERS OF CREDIT. Subject
to the terms and conditions hereof and the execution and delivery by the
Borrower of a letter of credit application on the Fronting Bank's customary form
as part of a Completed Loan Request (a "Letter of Credit Application"), the
Fronting Bank on behalf of the Banks and in reliance upon the agreement of the
Banks set forth in Section 3.1.4 and upon the representations and warranties of
the Borrower contained herein, agrees, in its individual capacity, to issue,
extend and renew for the account of the Borrower one or more letters of credit
(individually, a "Letter of Credit"), in such form as may be requested from time
to time by the Borrower and reasonably agreed to by the Fronting Bank; PROVIDED,
HOWEVER, that, after giving effect to such Completed Loan Request, (a) the
Maximum Drawing Amount plus all Reimbursement Obligations (to the extent, if
any, not yet deemed a Revolving Credit Loan pursuant to Section 3.3), shall not
exceed $100,000,000 at any one time and (b) the sum of (i) the Maximum Drawing
Amount and, without double counting, all Reimbursement Obligations (to the
extent, if any, not yet deemed a Revolving Credit Loan pursuant to Section 3.3)
and (ii) the amount of all Loans (including Swingline Loans and Bid Rate Loans)
outstanding shall not exceed the lesser of (x) the Total Commitment in effect at
such time and (y) the Borrowing Base Availability at such time.

                   Section 3.1.2. LETTER OF CREDIT APPLICATIONS. Each Letter of
Credit Application shall be completed to the reasonable satisfaction of the
Agent and the Fronting Bank. In

                                      -46-


the event that any provision of any Letter of Credit Application shall be
inconsistent with any provision of this Agreement (including provisions
applicable to a Completed Loan Request) or shall impose additional financial or
other material obligations (other than technical, administrative and ministerial
obligations, whether relating to the mechanics of a draw under a Letter of
Credit or otherwise), then the provisions of this Agreement shall, to the extent
of any such inconsistency or additional material obligation, govern.

                   Section 3.1.3. TERMS OF LETTERS OF CREDIT. Each Letter of
Credit issued, extended or renewed hereunder shall, among other things, (i)
provide for the payment of sight drafts for honor thereunder when presented in
accordance with the terms thereof and when accompanied by the documents
described therein, and (ii) have an expiry date no later than the date which is
fourteen (14) days prior to the Maturity Date. Each Letter of Credit so issued,
extended or renewed shall be subject to the Uniform Customs.

                   Section 3.1.4. OBLIGATIONS OF BANKS WITH RESPECT TO LETTERS
OF CREDIT. Each Bank severally agrees that it shall be absolutely liable,
without regard to the occurrence of any Default or Event of Default or any other
condition precedent whatsoever, to the extent of such Bank's Commitment
Percentage, to reimburse the Fronting Bank on demand pursuant to Section 3.3 for
the amount of each draft paid by the Fronting Bank under each Letter of Credit
to the extent that such amount is not reimbursed by the Borrower pursuant to
Section 3.2 (such agreement for a Bank being called herein the "Letter of Credit
Participation" of such Bank). Each such payment made by a Bank shall be treated
as a purchase by such Bank of a participation in the Fronting Bank's interest in
such Letter of Credit and each Bank shall share, in accordance with its
respective Commitment Percentage, in any interest which accrues and is payable
by the Borrower pursuant to Section 3.2 or otherwise in connection with such
Letter of Credit.

                   Section 3.1.5. FRONTING BANK. Notwithstanding the definition
of Fronting Bank, in the event that the Borrower reasonably determines that it
would be beneficial to have a Letter of Credit issued by a Bank with a higher
rating than Fleet has at any applicable time of reference (as determined by
Moody's or S&P), or for any other reason acceptable to the Agent, the Borrower
shall have the right to elect any Bank having a higher rating than Fleet (or
such other applicable Bank) as the Fronting Bank for that particular Letter of
Credit, PROVIDED that no Bank other than Fleet shall be required to be a
Fronting Bank.

    Section 3.2.   REIMBURSEMENT OBLIGATION OF THE BORROWER. In order to induce
the Fronting Bank to issue, extend and renew each Letter of Credit and the Banks
to participate therein, the Borrower hereby agrees, except as contemplated in
Section 3.3, to reimburse or pay to the Fronting Bank, for the account of the
Fronting Bank or (as the case may be) the Banks, with respect to each Letter of
Credit issued, extended or renewed by the Fronting Bank hereunder,

                   (a) except as otherwise expressly provided in Section 3.2(b)
and (c) or Section 3.3, promptly upon notification by the Fronting Bank or the
Agent that any draft presented

                                      -47-


under such Letter of Credit is honored by the Fronting Bank, or the Fronting
Bank otherwise makes a payment with respect thereto, (i) the amount paid by the
Fronting Bank under or with respect to such Letter of Credit, and (ii) any
amounts payable pursuant to Section 5.5 under, or with respect to, such Letter
of Credit,

                   (b) upon the reduction (but not termination) of the Total
Commitment to an amount less than the then Maximum Drawing Amount (after taking
into account all outstanding Loans and Reimbursement Obligations, if any
(without double counting)), an amount equal to such difference, which amount
shall be held by the Agent in an interest-bearing account (with interest to be
added to such account) as cash collateral for the benefit of the Banks and the
Agent for all Reimbursement Obligations, and

                   (c) upon the termination of the Total Commitment, or the
acceleration of the Reimbursement Obligations with respect to all Letters of
Credit in accordance with Section 14, an amount equal to the then Maximum
Drawing Amount on all Letters of Credit, which amount shall be held by the Agent
in an interest-bearing account (with interest to be added to such account) as
cash collateral for the benefit of the Banks and the Agent for all Reimbursement
Obligations.

    Each such payment shall be made to the Agent for the benefit of the Banks at
the Agent's Head Office in immediately available funds. Interest on any and all
amounts not converted to a Revolving Credit Loan pursuant to Section 3.3 and
remaining unpaid by the Borrower under this Section 3.2 at any time from the
date such amounts become due and payable (whether as stated in this Section 3.2,
by acceleration or otherwise) until payment in full (whether before or after
judgment) shall be payable to the Agent for the benefit of the Banks on demand
at the rate specified in Section 5.9 for overdue principal on the Loans.

    Section 3.3.   LETTER OF CREDIT PAYMENTS; FUNDING OF A LOAN. If any draft
shall be presented or other demand for payment shall be made under any Letter of
Credit, the Fronting Bank will use its best efforts to notify the Borrower and
the Banks, on or before the date the Fronting Bank intends to honor such
drawing, of the date and amount of the draft presented or demand for payment and
of the date and time when it expects to pay such draft or honor such demand for
payment and, except to the extent the amount of such draft becomes a Revolving
Credit Loan as set forth in this Section 3.3, Borrower shall reimburse Agent, as
set forth in Section 3.2. Notwithstanding anything contained in Section 3.2 or
this Section 3.3 to the contrary, however, unless Borrower shall have notified
the Agent and Fronting Bank prior to 11:00 a.m. (New York time) on the Business
Day immediately prior to the date of such drawing that Borrower intends to
reimburse Fronting Bank for the amount of such drawing with funds other than the
proceeds of Revolving Credit Loans, Borrower shall be deemed to have timely
given a Completed Loan Request pursuant to Section 2.4 to Agent, requesting a
Prime Rate Loan on the date on which such drawing is honored and in an amount
equal to the amount of such drawing. The Borrower may thereafter convert any
such Prime Rate Loan to a Revolving Credit Loan of another Type in accordance
with Section 2.5. Each Bank shall, in accordance with Section 2.6, make
available such Bank's

                                      -48-


Commitment Percentage of such Revolving Credit Loan to Agent, the proceeds of
which shall be applied directly by Agent to reimburse Fronting Bank for the
amount of such draw. In the event that any Bank fails to make available to Agent
the amount of such Bank's Commitment Percentage of such Revolving Credit Loan on
the date of any drawing, Agent shall be entitled to recover such amount on
demand from such Bank plus any additional amounts payable under Section 2.6(b)
in the event of a late funding by a Bank. The Fronting Bank is irrevocably
authorized by the Borrower and each of the Banks to honor draws on each Letter
of Credit by the beneficiary thereof in accordance with the terms of such Letter
of Credit. The responsibility of the Agent to the Borrower and the Banks shall
be only to determine that the documents (including each draft) delivered under
each Letter of Credit in connection with such presentment shall be in conformity
in all material respects with such Letter of Credit.

    Section 3.4.   OBLIGATIONS ABSOLUTE. The Borrower's obligations under this
Section 3 shall be absolute and unconditional under any and all circumstances
and irrespective of the occurrence of any Default or Event of Default or any
condition precedent whatsoever or any setoff, counterclaim or defense to payment
which the Borrower may have or have had against the Agent, any Bank or any
beneficiary of a Letter of Credit. The Borrower further agrees with the Agent
and the Banks that the Agent and the Banks shall not be responsible for, and the
Borrower's Reimbursement Obligations under Section 3.2 shall not be affected by,
among other things, the validity or genuineness of documents or of any
endorsements thereon (so long as the documents delivered under each Letter of
Credit in connection with such presentment shall be in the form required by, and
in conformity in all material respects with, such Letter of Credit), even if
such documents should in fact prove to be in any or all respects invalid,
fraudulent or forged, or any dispute between or among the Borrower, the
beneficiary of any Letter of Credit or any financing institution or other party
to whom any Letter of Credit may be transferred, or any claims or defenses
whatsoever of the Borrower against the beneficiary of any Letter of Credit or
any such transferee. The Agent and the Banks shall not be liable for any error,
omission, interruption or delay in transmission, dispatch or delivery of any
message or advice, however transmitted, in connection with any Letter of Credit.
The Borrower agrees that any action taken or omitted by the Agent or any Bank
under or in connection with each Letter of Credit and the related drafts and
documents, if done in good faith and absent gross negligence, shall be binding
upon the Borrower and shall not result in any liability on the part of the Agent
or any Bank to the Borrower.

    Section 3.5.   RELIANCE BY ISSUER. To the extent not inconsistent with
Section 3.4, the Agent and any Fronting Bank shall be entitled to rely, and
shall be fully protected in relying upon, any Letter of Credit, draft, writing,
resolution, notice, consent, certificate, affidavit, letter, cablegram,
telegram, telecopy, telex or teletype message, statement, order or other
document believed by it to be genuine and correct and to have been signed, sent
or made by the proper Person or Persons and upon advice and statements of legal
counsel, independent accountants and other experts selected by the Agent. The
Agent and any Fronting Bank shall be fully justified in failing or refusing to
take any action under this Section 3

                                      -49-


(other than the issuance of a Letter of Credit pursuant to a Letter of Credit
Application and otherwise in accordance with the terms of this Agreement) unless
it shall first have received such advice or concurrence of the Majority Banks
(or such other number or percentage of the Banks as may be required by this
Agreement) as it reasonably deems appropriate or it shall first be indemnified
to its reasonable satisfaction by the Banks against any and all liability and
expense which may be incurred by it by reason of taking or continuing to take
any such action. The Agent and any Fronting Bank shall in all cases be fully
protected by the Banks in acting, or in refraining from acting, under this
Section 3 in accordance with a request of the Majority Banks(or such other
number or percentage of the Banks as may be required by this Agreement), and
such request and any action taken or failure to act pursuant thereto shall be
binding upon the Banks and all future holders of the Notes or of a Letter of
Credit Participation.

    Section 3.6.   LETTER OF CREDIT FEE. The Borrower shall pay to the Agent a
fee (in each case, a "Letter of Credit Fee") in an amount equal to the
Applicable L/C Percentage of the undrawn amount of each outstanding Letter of
Credit, which fee (a) shall be payable quarterly in arrears on the first day of
each calendar quarter for the immediately preceding calendar quarter, with a
final payment on the Maturity Date or any earlier date on which the Commitments
shall terminate (which Letter of Credit Fee shall be pro-rated for any calendar
quarter in which such Letter of Credit is issued, drawn upon or otherwise
reduced or terminated) and (b) shall be for the accounts of the Banks as
follows: (i) an amount equal to 0.125% per annum of the Letter of Credit Fee
shall be for the account of the Fronting Bank and (ii) the remainder of the
Letter of Credit Fee shall be for the accounts of the Banks (including the
Fronting Bank) PRO RATA in accordance with their respective Commitment
Percentages.

    Section 4.     REPAYMENT OF THE LOANS.

    Section 4.1.   MATURITY. In addition to, and without limiting, the
provisions of Section 2.8(b) and Section 2.9(f), the Borrower promises to pay on
the Maturity Date, and there shall become absolutely due and payable on the
Maturity Date, all unpaid principal of the Revolving Credit Loans and each other
Loan, if any, outstanding on such date, together with any and all accrued and
unpaid interest thereon, the unpaid balance of the Facility Fee accrued through
such date, and any and all other unpaid amounts due under this Agreement, the
Notes or any other of the Loan Documents.

    Section 4.2.   OPTIONAL REPAYMENTS OF REVOLVING CREDIT LOANS. The Borrower
shall have the right, at its election, to prepay the outstanding amount of the
Revolving Credit Loans, in whole or in part, at any time without penalty or
premium; PROVIDED that the outstanding amount of any Eurodollar Rate Loans may
not be prepaid unless the Borrower pays the Eurodollar Breakage Costs for each
Eurodollar Rate Loan so prepaid at the time of such prepayment. The Borrower
shall give the Agent (with copies to the Agent for each Bank), no later than
10:00 a.m., Boston, Massachusetts time, at least two (2) Business Days' prior
written notice of any prepayment pursuant to this Section 4.2 of any

                                      -50-


Prime Rate Loans, and at least four (4) Eurodollar Business Days' notice of any
proposed prepayment pursuant to this Section 4.2 of Eurodollar Rate Loans,
specifying the proposed date of prepayment of Revolving Credit Loans and the
principal amount to be prepaid. Each such partial prepayment of the Loans shall
be in an amount equal to $500,000 or an integral multiple of $100,000 in excess
thereof or, if less, the outstanding balance of the Revolving Credit Loans then
being repaid, shall be accompanied by the payment of all charges, if any,
outstanding on all Revolving Credit Loans so prepaid and of all accrued interest
on the principal prepaid to the date of payment, and shall be applied, in the
absence of instruction by the Borrower, first to the principal of Prime Rate
Loans and then to the principal of Eurodollar Rate Loans.

    Section 4.3    MANDATORY REPAYMENT OF LOANS. If at any time the sum of the
outstanding amount of the Loans, PLUS the Maximum Drawing Amount, PLUS without
double-counting any Revolving Credit Loans, the outstanding Reimbursement
Obligations, if any, exceeds the lesser of (i) the Total Commitment at such
time, or (ii) the Borrowing Base Availability at such time, the Borrower shall,
within fifteen (15) days after receiving notice of such excess from the Agent
(i) pay to the Agent an amount in cash necessary to eliminate such excess, such
amount to be applied, in the absence of instruction by the Borrower, (x) first
to the repayment of Swingline Loans, second to the repayment of Revolving Credit
Loans and third to the repayment of Bid Rate Loans and (y) with respect to any
such payments of Revolving Credit Loans, first to the principal of Prime Rate
Loans and then to the principal of Eurodollar Rate Loans, or (ii) add one (1) or
more Real Estate Assets to the Borrowing Base which have Borrowing Base Values,
in the aggregate, sufficient to eliminate such excess.

    Section 5.     CERTAIN GENERAL PROVISIONS.

    Section 5.1.   FUNDS FOR PAYMENTS.

                   (a) All payments of principal, interest, fees, and any other
amounts due hereunder or under any of the other Loan Documents shall be made to
the Agent, for the respective accounts of the Banks or (as the case may be) the
Agent, at the Agent's Head Office, in each case in Dollars and in immediately
available funds. The Borrower shall make each payment of principal of and
interest on the Loans and of fees hereunder and Reimbursement Obligations which
are not converted to a Loan hereunder not later than 1:00 p.m. (Boston,
Massachusetts time) on the due date thereof.

                   (b) All payments by the Borrower hereunder and under any of
the other Loan Documents shall be made without setoff or counterclaim and free
and clear of and without deduction for any taxes, levies, imposts, duties,
charges, fees, deductions, withholdings, compulsory liens, restrictions or
conditions of any nature now or hereafter imposed or levied by any jurisdiction
or any political subdivision thereof or taxing or other authority therein unless
the Borrower is compelled by law to make such deduction or withholding. If the
Borrower is compelled by law to make any such deduction or

                                      -51-


withholding with respect to any amount payable by it hereunder or under any of
the other Loan Documents (except with respect to taxes on the income or profits
of the Agent or any Bank), the Borrower shall pay to the Agent, for the account
of the Banks or (as the case may be) the Agent, on the date on which such amount
is due and payable hereunder or under such other Loan Document, such additional
amount in Dollars as shall be necessary to enable the Banks to receive the same
net amount which the Banks would have received on such due date had no such
obligation been imposed upon the Borrower. The Borrower will deliver promptly to
the Agent (with copies to the Agent for each Bank) certificates or other valid
vouchers for all taxes or other charges deducted from or paid with respect to
payments made by the Borrower hereunder or under such other Loan Document.

    Section 5.2.   COMPUTATIONS. All computations of interest on the Loans and
of other fees to the extent applicable shall be based on a 360-day year and paid
for the actual number of days elapsed. Except as otherwise provided in the
definition of the term "Interest Period" with respect to Eurodollar Rate Loans,
whenever a payment hereunder or under any of the other Loan Documents becomes
due on a day that is not a Business Day, the due date for such payment shall be
extended to the next succeeding Business Day, and interest shall accrue during
such extension. The outstanding amount of the Loans as reflected on the Note
Records or record attached to any other Note from time to time shall constitute
prima facie evidence of the principal amount thereof.

    Section 5.3.   INABILITY TO DETERMINE EURODOLLAR RATE. In the event, prior
to the commencement of any Interest Period relating to any Eurodollar Rate Loan,
the Agent shall reasonably and in good faith determine that adequate and
reasonable methods do not exist for ascertaining the Eurodollar Rate that would
otherwise determine the rate of interest to be applicable to any Eurodollar Rate
Loan during any Interest Period, the Agent shall forthwith give notice of such
determination (which shall be conclusive and binding on the Borrower) to the
Borrower and the Banks. In such event (a) any Loan Request with respect to
Eurodollar Rate Loans shall be automatically withdrawn and shall be deemed a
request for Prime Rate Loans, (b) each Eurodollar Rate Loan will automatically,
on the last day of the then current Interest Period applicable thereto, become a
Prime Rate Loan, and (c) the obligations of the Banks to make Eurodollar Rate
Loans shall be suspended, in each case unless and until the Agent reasonably and
in good faith determines that the circumstances giving rise to such suspension
no longer exist, whereupon the Agent shall so notify the Borrower and the Banks.

    Section 5.4.   ILLEGALITY. Notwithstanding any other provisions herein, if
any present or future law, regulation, treaty or directive or in the
interpretation or application thereof shall make it unlawful for any Bank to
make or maintain Eurodollar Rate Loans, such Bank shall forthwith give notice of
such circumstances to the Borrower and thereupon (a) the Commitment of such Bank
to make Eurodollar Rate Loans or convert Prime Rate Loans to Eurodollar Rate
Loans shall forthwith be suspended and (b) such Bank's Commitment Percentage of
Eurodollar Rate Loans then outstanding shall be converted

                                      -52-


automatically to Prime Rate Loans on the last day of each Interest Period
applicable to such Eurodollar Rate Loans or within such earlier period as may be
required by law, all until such time as it is no longer unlawful for such Bank
to make or maintain Eurodollar Rate Loans. Subject to the limitations set forth
in Section 5.7, the Borrower hereby agrees promptly to pay the Agent for the
account of such Bank, upon demand, any additional amounts necessary to
compensate such Bank for any costs incurred by such Bank in making any
conversion required by this Section 5.4 prior to the last day of an Interest
Period with respect to a Eurodollar Rate Loan, including any interest or fees
payable by such Bank to lenders of funds obtained by it in order to make or
maintain its Eurodollar Rate Loans hereunder.

    Section 5.5.   ADDITIONAL COSTS, ETC. If any present or future applicable
law, which expression, as used herein, includes statutes, rules and regulations
thereunder and interpretations thereof by any competent court or by any
governmental or other regulatory body or official charged with the
administration or the interpretation thereof and requests, directives,
instructions and notices at any time or from time to time hereafter made upon or
otherwise issued to any Bank or the Agent by any central bank or other fiscal,
monetary or other authority (whether or not having the force of law, but if not
having the force of law, then generally applied by the Banks or the Agent with
respect to similar loans), shall:

                   (a) subject any Bank or the Agent to any tax, levy, impost,
duty, charge, fee, deduction or withholding of any nature with respect to this
Agreement, the other Loan Documents, any Letters of Credit, such Bank's
Commitment or the Loans (other than taxes based upon or measured by the income
or profits of such Bank or the Agent), or

                   (b) materially change the basis of taxation (except for
changes in taxes on income or profits) of payments to any Bank of the principal
of or the interest on any Loans or any other amounts payable to the Agent or any
Bank under this Agreement or the other Loan Documents, or

                   (c) impose or increase or render applicable (other than to
the extent specifically provided for elsewhere in this Agreement) any special
deposit, reserve, assessment, liquidity, capital adequacy or other similar
requirements (whether or not having the force of law) against assets held by, or
deposits in or for the account of, or loans by, or letters of credit issued by,
or commitments of an office of any Bank, or

                   (d) impose on any Bank or the Agent any other conditions or
requirements with respect to this Agreement, the other Loan Documents, any
Letters of Credit, the Loans, such Bank's Commitment, or any class of loans,
letters of credit or commitments of which any of the Loans or such Bank's
Commitment forms a part;

and the result of any of the foregoing is

                                      -53-


                       (i)   to increase the cost to any Bank of making,
                   funding, issuing, renewing, extending or maintaining any of
                   the Loans or such Bank's Commitment or any Letter of Credit,
                   or

                       (ii)  to reduce the amount of principal, interest,
                   Reimbursement Obligation or other amount payable to such Bank
                   or the Agent hereunder on account of such Bank's Commitment,
                   any Letter of Credit or any of the Loans, or

                       (iii) to require such Bank or the Agent to make any
                   payment or to forego any interest or Reimbursement Obligation
                   or other sum payable hereunder, the amount of which payment
                   or foregone interest or Reimbursement Obligation or other sum
                   is calculated by reference to the gross amount of any sum
                   receivable or deemed received by such Bank or the Agent from
                   the Borrower hereunder,

then, and in each such case, the Borrower will, within thirty (30) days after
notice by the Agent or such Bank (such notice to be given promptly by the Agent
or such Bank upon the making of any such determination), at any time and from
time to time and as often as the occasion therefor may arise, but subject to the
limitations set forth in Section 5.7, pay to such Bank or the Agent such
additional amounts as such Bank or the Agent shall determine in good faith to be
sufficient to compensate such Bank or the Agent for such additional cost,
reduction, payment or foregone interest or other sum, PROVIDED that such Bank or
the Agent is generally imposing similar charges on its other similarly situated
borrowers.

    Section 5.6.   CAPITAL ADEQUACY. If any future law, governmental rule,
regulation, policy, guideline or directive (whether or not having the force of
law, but if not having the force of law, then generally applied by the Banks
with respect to similar loans) or the interpretation thereof by a court or
governmental authority with appropriate jurisdiction affects the amount of
capital required or expected to be maintained by banks or bank holding companies
and any Bank or the Agent determines that the amount of capital required to be
maintained by it is increased by or based upon the existence of Loans made or
deemed to be made pursuant hereto, then such Bank or the Agent may notify the
Borrower of such fact, and the Borrower shall pay to such Bank or the Agent from
time to time, within thirty (30) days after notice by the Agent or such Bank
(such notice to be given promptly by the Agent or such Bank upon the making of
any such determination), as an additional fee payable hereunder, but subject to
the limitations set forth in Section 5.7, such amount as such Bank or the Agent
shall determine reasonably and in good faith and certify in a notice to the
Borrower to. be an amount that will adequately compensate such Bank in light of
these circumstances for its increased costs of maintaining such capital. Each
Bank and the Agent shall allocate such cost increases among its customers in
good faith and on an equitable basis, and will not charge the Borrower unless it
is generally imposing a similar charge on its other similarly situated
borrowers.

                                      -54-


    Section 5.7.   CERTIFICATE; LIMITATIONS. A certificate setting forth any
additional amounts payable pursuant to Section Section 5.5 or 5.6 and a brief
explanation of such amounts which are due, including reasonably detailed
information regarding the method and calculation of such amount, submitted by
any Bank or the Agent to the Borrower, shall be PRIMA FACIE evidence that such
amounts are due and owing. Notwithstanding anything to the contrary contained in
this Article 5, (i) to the extent reasonably possible, each Bank shall designate
an alternate lending office in the continental United States to make the Loans
in order to reduce any liability of Borrower to such Bank under Section Section
5.4, 5.5 or 5.6 or to avoid the unavailability of a Eurodollar Rate Loan, so
long as such designation is not disadvantageous to such Bank, and (ii) the
Borrower shall not be obligated to compensate any Bank pursuant to Section
Section 5.4, 5.5 or 5.6 for any amounts attributable to any period which is more
than one (1) year prior to the date of delivery of the certificate set forth in
the first sentence of this Section 5.7.

    Section 5.8.   INDEMNITY. In addition to the other provisions of this
Agreement regarding such matters, the Borrower agrees to indemnify the Agent and
each Bank and to hold the Agent and each Bank harmless from and against any
loss, cost or expense (including loss of the spread to which such Bank would
have been entitled through the end of the applicable Interest Period in excess
of the applicable interest rate(s) then in effect) that the Agent or such Bank
may sustain or incur as a consequence of (a) a default by the Borrower in the
payment of any principal amount of or any interest on any Eurodollar Rate Loans
as and when due and payable, including any such loss or expense arising from
interest or fees payable by the Agent or such Bank to lenders of funds obtained
by it in order to maintain its Eurodollar Rate Loans, (b) the failure by the
Borrower to make a borrowing or conversion after the Borrower has given a
Completed Loan Request for a Eurodollar Rate Loan or a Conversion Request for a
Eurodollar Rate Loan, and (c) the making of any payment of a Eurodollar Rate
Loan or the making of any conversion of any such Loan to a Prime Rate Loan on a
day that is not the last day of the applicable Interest Period with respect
thereto, including interest or fees payable by the Agent or a Bank to lenders of
funds obtained by it in order to maintain any such Eurodollar Rate Loans;
PROVIDED, HOWEVER, that the Borrower shall not be required to so indemnify any
Bank pursuant to clause (b) above during and for any period of time when such
Bank has wrongfully failed or refused to fund its proportionate share of a Loan
in accordance with the terms of this Agreement and is a Delinquent Bank.

    Section 5.9.   INTEREST ON OVERDUE AMOUNTS. Overdue principal and (to the
extent permitted by applicable law) interest on the Loans and all other overdue
amounts payable hereunder or under any of the other Loan Documents shall bear
interest payable on demand at a rate per annum equal to three percent (3%) PLUS
the Prime Rate until such amount shall be paid in full (after as well as before
judgment). In addition, the Borrower shall pay a late charge equal to three
percent (3%) of any amount of interest charges on the Loans which is not paid
within ten (10) days of the date when due.

                                      -55-


    Section 6.     RECOURSE OBLIGATIONS. The Obligations are full recourse
obligations of the Borrower, and all of the respective assets and properties of
the Borrower shall be available for the payment in full in cash and performance
of the Obligations. In no event shall BPI have any personal liability hereunder
or under any of the other Loan Documents, either individually or as general
partner of BPLP or any other Borrower, by application of applicable law or
otherwise, except to the extent BPI misappropriates funds, rents or insurance
proceeds or engages in gross negligence, willful misconduct or fraud.

    Section 7.     REPRESENTATIONS AND WARRANTIES. The Borrower for itself and
for BPI insofar as any such statements relate to BPI represents and warrants to
the Banks all of the statements contained in this Section 7.

    Section 7.1.   AUTHORITY, ETC.

                   (a) ORGANIZATION: GOOD STANDING.

                            (i)  The Borrower is a limited partnership, general
                       partnership, nominee trust or limited liability company,
                       as the case may be, duly organized, validly existing and
                       in good standing under the laws of its state of
                       organization, unless the failure to be so does not relate
                       to BPLP or BPI and is a Non-Material Breach; the Borrower
                       has all requisite limited partnership, general
                       partnership, trust, limited liability company or
                       corporate, as the case may be, power to own its
                       respective properties and conduct its respective business
                       as now conducted and as presently contemplated, unless
                       any such failure to have any of the foregoing does not
                       relate to BPLP or BPI and is a Non-Material Breach; and
                       the Borrower is in good standing as a foreign entity and
                       is duly authorized to do business in the jurisdictions
                       where the Borrowing Base Properties owned or
                       ground-leased by it are located and in each other
                       jurisdiction where such qualification is necessary except
                       where a failure to be so qualified in such other
                       jurisdiction would not have a materially adverse effect
                       on any of their respective businesses, assets or
                       financial conditions.

                            (ii) BPI is a corporation duly organized, validly
                       existing and in good standing under the laws of the State
                       of Delaware; each Subsidiary of BPI is duly organized,
                       validly existing and in good standing as a corporation,
                       nominee trust, limited liability company, limited
                       partnership or general partnership, as the case may be,
                       under the laws of the state of its organization, unless
                       the failure to be so does not relate to BPLP and is a
                       Non-Material Breach; BPI and each of its Subsidiaries has
                       all requisite corporate, trust,

                                      -56-


                       limited liability company, limited partnership or general
                       partnership, as the case may be, power to own its
                       respective properties and conduct its respective business
                       as now conducted and as presently contemplated, unless
                       any such failure to have any of the foregoing does not
                       relate to BPLP or BPI and is a Non-Material Breach; and
                       BPI is in good standing as a foreign entity and is duly
                       authorized to do business in the jurisdictions where such
                       qualification is necessary (including in the Commonwealth
                       of Massachusetts) except where a failure to be so
                       qualified in such other would not have a materially
                       adverse effect on the business, assets or financial
                       condition of BPI.

                   (b) CAPITALIZATION. The outstanding equity of BPLP is
comprised of a general partner interest and limited partner interests, all of
which have been duly issued and are outstanding and fully paid and
non-assessable. All of the issued and outstanding general partner interests of
the BPLP are owned and held of record by BPI. There are no outstanding
securities or agreements exchangeable for or convertible into or carrying any
rights to acquire a general partner interest in BPLP. There are no outstanding
commitments, options, warrants, calls or other agreements (whether written or
oral) binding on BPLP or BPI which require or could require BPLP or BPI to sell,
grant, transfer, assign, mortgage, pledge or otherwise dispose of any general
partner interest in BPLP. Except as set forth in the Agreement of Limited
Partnership of BPLP, no general partner interests of BPLP are subject to any
restrictions on transfer or any partner agreements, voting agreements, trust
deeds, irrevocable proxies; or any other similar agreements or interests
(whether written or oral). For so long as any Borrower which is a Wholly-owned
Subsidiary is a Borrower, BPLP owns, directly or indirectly, at least a majority
(by number of votes or controlling interests) of the outstanding voting
interests and at least 99% of the economic interests in each of the Borrowers
other than BPLP. All of the Preferred Creditor Equity which exists as of the
date of this Agreement, and each of the agreements or other documents entered
into and/or setting forth the terms, rights and restrictions applicable to any
such Preferred Creditor Equity, are listed and described on SCHEDULE 7.1(B)
attached hereto. All of the agreements and other documents relating to the
Preferred Equity in effect on the Closing Date have been furnished to the Agent.

                   (c) DUE AUTHORIZATION. The execution, delivery and
performance of this Agreement and the other Loan Documents to which the Borrower
or BPI is or is to become a party and the transactions contemplated hereby and
thereby (i) are within the authority of the Borrower and BPI, (ii) have been
duly authorized by all necessary proceedings on the part of the Borrower or BPI
and any general partner thereof, (iii) do not materially conflict with or result
in any breach or contravention of any provision of law, statute, rule or
regulation to which the Borrower or BPI is subject or any judgment, order, writ,
injunction, license or permit applicable to the Borrower or BPI, unless any such
conflict, breach or contravention does not relate to BPLP or BPI and is a
Non-Material Breach, (iv) do not conflict with any provision of the agreement of
limited

                                      -57-


partnership, any certificate of limited partnership, the charter documents or
by-laws of the Borrower or BPI or any general partner thereof, and (v) do not
contravene any provisions of, or constitute Default or Event of Default
hereunder or a failure to comply with any term, condition or provision of, any
other agreement, instrument, judgment, order, decree, permit, license or
undertaking binding upon or applicable to the Borrower or BPI or any of the
Borrower's or BPI's properties (except for any such failure to comply under any
such other agreement, instrument, judgment, order, decree, permit, license, or
undertaking as would not materially and adversely affect the condition
(financial or otherwise), properties, business or results of operations of BPLP,
BPI or, taken as a whole, the BP Group) or result in the creation of any
mortgage, pledge, security interest, lien, encumbrance or charge upon any of the
properties or assets of the Borrower or BPI.

                   (d) ENFORCEABILITY. Each of the Loan Documents to which the
Borrower or BPI is a party has been duly executed and delivered and constitutes
the legal, valid and binding obligations of the Borrower and BPI, as the case
may be, subject only to applicable bankruptcy, insolvency, reorganization,
moratorium or other laws relating to or affecting generally the enforcement of
creditors' rights and to the fact that the availability of the remedy of
specific performance or injunctive relief is subject to the discretion of the
court before which any proceeding therefor may be brought.

    Section 7.2.   GOVERNMENTAL APPROVALS. The execution, delivery and
performance by the Borrower of this Agreement and by the Borrower and BPI of the
other Loan Documents to which the Borrower or BPI is or is to become a party and
the transactions contemplated hereby and thereby do not require (i) the approval
or consent of any governmental agency or authority other than those already
obtained or those which would not have a material adverse effect on BPLP, BPI
or, taken as a whole, the BP Group, or (ii) filing with any governmental agency
or authority, other than filings which will be made with the SEC when and as
required by law or deemed appropriate by BPI.

    Section 7.3.   TITLE TO PROPERTIES; LEASES.

    The Borrower and BPI each has good fee or leasehold title to all of its
respective properties, assets and rights of every name and nature purported to
be owned by it, including, without limitation, that:

                   (a) As of the Closing Date (with respect to Borrowing Base
Properties designated as such on the Closing Date) or the date of designation as
a Borrowing Base Properties (with respect to Borrowing Base Properties acquired
and/or designated as such after the Closing Date), and in each case to the best
of its knowledge thereafter (but only for so long as such Real Estate Assets
continue to be Borrowing Base Properties), the Borrower holds good and clear
record and marketable fee simple or leasehold title to (or an undivided
condominium interest in) the Borrowing Base Properties, subject to no Liens,
except for Permitted Liens and, in the case of any ground-leased Borrowing Base
Property, the terms of such ground lease, as the same may then or thereafter be
amended

                                      -58-


from time to time in a manner consistent with the minimum term for ground leases
set forth in the definition of "Real Estate Assets" in Section 1.1 above.

                   (b) The Borrower and BPI will, as of the Closing Date, own
all of the assets as reflected in the financial statements of the Borrower and
BPI described in Section 7.4, the Registration Statement, the Prospectus, the
preliminary Prospectus and any so-called follow-on prospectus or acquired since
the date of such financial statements (except property and assets sold or
otherwise disposed of in the ordinary course of business since that date).

    Section 7.4.   FINANCIAL STATEMENTS. The following financial statements have
been furnished to each of the Banks:

                   The consolidated balance sheet of BPI and its Subsidiaries as
of December 31, 2001 (together with the unaudited consolidated balance sheet of
BPI and its Subsidiaries as of September 30, 2002), and their related
consolidated statements of income, changes in shareholders' equity and cash
flows for the fiscal year or other period then ended, as applicable, and setting
forth in comparative form the figures as of the end of and for the previous
fiscal year or other period, as applicable, prepared in accordance with GAAP
and, with respect to the December 31, 2001 statements, accompanied by an
auditor's report prepared without qualification by the Accountants
(collectively, the "Initial Financial Statements"). The Initial Financial
Statements fairly present the financial condition of BPI and its Subsidiaries as
at the close of business on the date thereof and the results of operations for
the fiscal year or other period then ended, as applicable. There are no
contingent liabilities of BPI or any of its Subsidiaries as of such date
involving material amounts, known to the officers of BPI or any of its
Subsidiaries not disclosed in said Initial Financial Statements.

    Section 7.5    NO MATERIAL CHANGES, ETC. Since the Financial Statement Date,
there has occurred no materially adverse change in the financial condition or
business of BPLP, BPI or, taken as a whole, the BP Group, other than changes in
the ordinary course of business that have not had any materially adverse effect
either individually or in the aggregate on the business or financial condition
of BPLP, BPI or, taken as a whole, the BP Group. Between the Financial Statement
Date and the Closing Date, there has been no material adverse change to the Net
Operating Income of any Real Estate Asset that is a Borrowing Base property on
the Closing Date.

    Section 7.6.   FRANCHISES, PATENTS, COPYRIGHTS, ETC. Except to the extent
the failure or breach of such representation or warranty constitutes a
Non-Material Breach, the Borrower, BPI and each of their respective Subsidiaries
possess all franchises, patents, copyrights, trademarks, trade names, licenses
and permits, and rights in respect of the foregoing, adequate for the conduct of
their respective businesses substantially as now conducted without known
conflict with any rights of others, including all material Permits.

                                      -59-


    Section 7.7    LITIGATION. Except as stated on SCHEDULE 7.7, there are no
actions, suits, proceedings or investigations of any kind pending or, to the
Borrower's knowledge, threatened against the Borrower, BPI or any of their
respective Subsidiaries before any court, tribunal or administrative agency or
board that, if adversely determined, might, either individually or in the
aggregate, materially adversely affect the properties, assets, financial
condition or business of BPLP, BPI or, taken as a whole, the BP Group, or
materially impair the right of BPLP, BPI or, taken as a whole, the BP Group, to
carry on their respective businesses substantially as now conducted by them, or
result in any substantial liability not adequately covered by insurance, or for
which adequate reserves are not maintained, as reflected in the applicable
consolidated financial statements or SEC Filings of the Borrower and BPI, or
which question the validity of this Agreement or any of the other Loan
Documents, or any action taken or to be taken pursuant hereto or thereto.

    Section 7.8.   NO MATERIALLY ADVERSE CONTRACTS, ETC. Neither the Borrower,
BPI nor any of their respective Subsidiaries is subject to any charter,
corporate, partnership or other legal restriction, or any judgment, decree,
order, rule or regulation that has or is reasonably expected in the future to
have (and with respect solely to any restriction on the timing of any sale or
refinancing of a Real Estate Asset which would be an acceptable Lien under the
definition of "Unencumbered Asset" contained in an Organizational Document, such
expectation existed at the time such restriction was imposed) a materially
adverse effect on the respective businesses, assets or financial conditions of
BPLP, BPI or, taken as a whole, the BP Group. None of the Borrower, BPI or any
of their respective Subsidiaries is a party to any contract or agreement that
has or is expected, in the judgment of their respective officers, to have any
materially adverse effect on the respective businesses of the BPLP, BPI or,
taken as a whole, the BP Group.

    Section 7.9.   COMPLIANCE WITH OTHER INSTRUMENTS, LAWS, ETC. Neither the
Borrower, BPI nor any of their respective Subsidiaries is in violation of any
provision of its partnership agreement or charter, as the case may be, or any
respective agreement or instrument to which it may be subject or by which it or
any of its properties may be bound or any decree, order, judgment, statute,
license, rule or regulation, in any of the foregoing cases in a manner that
could result, individually or in the aggregate, in the imposition of substantial
penalties or materially and adversely affect the financial condition, properties
or businesses of the BPLP, BPI or, taken as a whole, the BP Group.

    Section 7.10.  TAX STATUS. (i) Each of the Borrower, BPI and their
respective Subsidiaries (a) has made or filed all federal, state and local
income and all other tax returns, reports and declarations required by any
jurisdiction to which it is subject, (b) has paid all taxes and other
governmental assessments and charges shown or determined to be due on such
returns, reports and declarations, except those being contested in good faith
and by appropriate proceedings, and (c) has set aside on its books provisions
reasonably adequate for the payment of all taxes for periods subsequent to the
periods to which such

                                      -60-


returns, reports or declarations apply, and (ii) there are no unpaid taxes in
any material amount claimed to be due by the taxing authority of any
jurisdiction, and the respective officers of the Borrower and BPI and their
respective Subsidiaries know of no basis for any such claim.

    Section 7.11   NO EVENT OF DEFAULT. No Default or Event of Default has
occurred and is continuing.

    Section 7.12.  INVESTMENT COMPANY ACTS. None of the Borrower, BPI or any of
their respective Subsidiaries is an "investment company", or an "affiliated
company" or a "principal underwriter" of an "investment company", as such terms
are defined in the Investment Company Act of 1940.

    Section 7.13.  ABSENCE OF UCC FINANCING STATEMENTS, ETC. Except for
Permitted Liens and except to the extent the failure or breach of such
representation and warranty constitutes a Non-Material Breach, there is no
financing statement, security agreement, chattel mortgage, real estate mortgage,
equipment lease, financing lease, option, encumbrance or other document filed or
recorded with any filing records, registry, or other public office, that
purports to cover, affect or give notice of any present or possible future lien
or encumbrance on, or security interest in, any Borrowing Base Property. Neither
the Borrower nor BPI has pledged or granted any lien on or security interest in
or otherwise encumbered or transferred any of their respective interests in any
Subsidiary who is a Borrower (including in the case of BPI, its interests in
BPLP), unless such pledge, lien or security interest relates only to a Borrower
other than BPLP and is a Non-Material Breach.

    Section 7.14.  ABSENCE OF LIENS. The Borrower is the owner of or the holder
of a ground leasehold interest in the Borrowing Base Properties free from any
Lien, except for Permitted Liens.

    Section 7.15.  CERTAIN TRANSACTIONS. [Intentionally Omitted.]

    Section 7.16.  EMPLOYEE BENEFIT PLANS; MULTIEMPLOYER PLANS; GUARANTEED
PENSION PLANS. Except as disclosed in the SEC Filings or on SCHEDULE 7.16, none
of the Borrower, BPI nor any ERISA Affiliate maintains or contributes to any
Employee Benefit Plan, Multiemployer Plan or Guaranteed Pension Plan.

    Section 7.17.  REGULATIONS U AND X. No portion of any Loan is to be used,
and no portion of any Letter of Credit is to be obtained, for the purpose of
purchasing or carrying any "margin security" or "margin stock" as such terms are
used in Regulations U and X of the Board of Governors of the Federal Reserve
System, 12 C.F.R. Parts 221 and 224.

    Section 7.18.  ENVIRONMENTAL COMPLIANCE. The Borrower has caused Phase I and
other environmental assessments (collectively, the "Environmental Reports") to
be conducted

                                      -61-


and/or taken other steps to investigate the past and present environmental
condition and usage of the Real Estate Assets. Based upon such Environmental
Reports, to the Borrower's knowledge, except as identified in such Environmental
Reports, the Borrower makes the following representations and warranties:

                   (a) None of the Borrower, its Subsidiaries, BPI or any
operator of the Real Estate Assets or any portion thereof, or any operations
thereon is in material violation, or alleged material violation, of any
judgment, decree, order, law, license, rule or regulation pertaining to
environmental matters, including without limitation, those arising under the
Resource Conservation and Recovery Act ("RCRA"), the Comprehensive Environmental
Response, Compensation and Liability Act of 1980 as amended ("CERCLA"), the
Superfund Amendments and Reauthorization Act of 1986 ("SARA"), the Federal Clean
Water Act, the Federal Clean Air Act, the Toxic Substances Control Act, or any
state or local statute, regulation, ordinance, order or decree relating to
health, safety or the environment (hereinafter "Environmental Laws"), which
violation or alleged violation has, or its remediation would have, by itself or
when aggregated with all such other violations or alleged violations, a material
adverse effect on the business, assets or financial condition of the Borrower
and its Subsidiaries, taken as a whole, or constitutes a Disqualifying
Environmental Event with respect to any of the Borrowing Base Properties.

                   (b) None of the Borrower, BPI or any of their respective
Subsidiaries has received written notice from any third party, including,
without limitation, any federal, state or local governmental authority, (i) that
it has been identified by the United States Environmental Protection Agency
("EPA) as a potentially responsible party under CERCLA with respect to a site
listed on the National Priorities List, 40 C.F.R. Part 300 Appendix B (1986),
(ii) that any hazardous waste, as defined by 42 U.S.C. Section 9601(5), any
hazardous substances as defined by 42 U.S.C. Section 9601(14), any pollutant or
contaminant as defined by 42 U.S.C. Section 9601(33) or any toxic substances,
oil or hazardous materials or other chemicals or substances regulated by any
Environmental Laws ("Hazardous Substances") which it has generated, transported
or disposed of have been found at any site at which a federal, state or local
agency or other third party has conducted or has ordered that the Borrower, BPI
or any of their respective Subsidiaries conduct a remedial investigation,
removal or other response action pursuant to any Environmental Law, or (iii)
that it is or shall be a named party to any claim, action, cause of action,
complaint, or legal or administrative proceeding (in each case, contingent or
otherwise) arising out of any third party's incurrence of costs, expenses,
losses or damages of any kind whatsoever in connection with the release of
Hazardous Substances, which event described in any such notice would have a
material adverse effect on the business, assets or financial condition of the
Borrower and its Subsidiaries, taken as a whole, or constitutes a Disqualifying
Environmental Event with respect to any of the Borrowing Base Properties.

                   (c) (i) No portion of the Real Estate Assets has been used
for the handling, processing, storage or disposal of Hazardous Substances except
in material

                                      -62-


accordance with applicable Environmental Laws; and no underground tank or other
underground storage receptacle for Hazardous Substances is located on any
portion of any Real Estate Assets except in material accordance with applicable
Environmental Laws, (ii) in the course of any activities conducted by the
Borrower, BPI, their respective Subsidiaries or the operators of their
respective properties or any ground or space tenants on any Real Estate Asset,
no Hazardous Substances have been generated or are being used on such Real
Estate Asset except in material accordance with applicable Environmental Laws,
(iii) there has been no present or, to the best of Borrower's knowledge, past
releasing, spilling, leaking, pumping, pouring, emitting, emptying, discharging,
injecting, escaping, disposing or dumping (a "Release") or threatened Release of
Hazardous Substances on, upon, into or from the Real Estate Assets in violation
of applicable Environmental Laws, (iv) to the best of Borrower's knowledge,
there have been no Releases in violation of applicable Environmental Laws upon,
from or into any real property in the vicinity of any of the Real Estate Assets
which, through soil or groundwater contamination, may have come to be located on
such Real Estate Asset, and (v) to the best of Borrower's Knowledge, any
Hazardous Substances that have been generated on any of the Real Estate Assets
during ownership thereof by the Borrower, BPI, their respective Subsidiaries or
the operations of their respective properties have been transported off-site
only in compliance with all applicable Environmental Laws; any of which events
described in clauses (i) through (v) above would have a material adverse effect
on the business, assets or financial condition of BPLP, BPI, or taken as a
whole, the BP Group, or constitutes a Disqualifying Environmental Event with
respect to any of the Borrowing Base Properties. Notwithstanding that the
representations contained herein are limited to the knowledge of the Borrower,
any such limitation shall not affect the covenants specified in Section 8.11 or
elsewhere in this Agreement.

                   (d) None of the Borrower, BPI or any of the Real Estate
Assets is subject to any applicable Environmental Law requiring the performance
of Hazardous Substances site assessments, or the removal or remediation of
Hazardous Substances, or the giving of notice to any governmental agency or the
recording or delivery to other Persons of an environmental disclosure document
or statement, by virtue of the transactions set forth herein and contemplated
hereby, or as a condition to the effectiveness of any other transactions
contemplated hereby.

    Section 7.19.  SUBSIDIARIES. SCHEDULE 7.19 sets forth, as of the Closing
Date, all of the respective Subsidiaries of BPLP, each other Borrower and BPI.

    Section 7.20.  LOAN DOCUMENTS. All of the representations and warranties by
or on behalf of the Borrower and BPI and their respective Subsidiaries made in
this Agreement and in the other Loan Documents or any document or instrument
delivered to the Agent or the Banks pursuant to or in connection with any of
such Loan Documents are true and correct in all material respects and do not
include any untrue statement of a material fact or omit to state a material fact
required to be stated or necessary to make such representations and warranties
not materially misleading.

                                      -63-


    Section 7.21.  REIT STATUS. BPI has not taken any action that would prevent
it from maintaining its qualification as a REIT for its tax years ended December
31, 1997, December 31, 1998, December 31, 1999, December 31, 2000, December 31,
2001 or December 31, 2002 or from maintaining such qualification at all times
during the term of this Agreement.

    Section 8.     AFFIRMATIVE COVENANTS OF THE BORROWER AND BPI. The Borrower
for itself and on behalf of BPI and their respective Subsidiaries (if and to the
extent expressly included in subsections contained in this Section 8) covenants
and agrees that, so long as any Loan, Letter of Credit or Note is outstanding or
any Bank has any obligation to make any Loans or any Bank has any obligation to
issue, extend or renew any Letters of Credit:

    Section 8.1.   PUNCTUAL PAYMENT. The Borrower will duly and punctually pay
or cause to be paid the principal and interest on the Loans and all interest,
fees, charges and other amounts provided for in this Agreement and the other
Loan Documents, all in accordance with the terms of this Agreement and the
Notes, and the other Loan Documents.

    Section 8.2.   MAINTENANCE OF OFFICE. Each of the Borrower and BPI will
maintain its chief executive office in Boston, Massachusetts, or at such other
place in the United States of America as each of them shall designate by written
notice to the Agent to be delivered within fifteen (15) days of any change of
chief executive office, where, subject to Section 22, notices, presentations and
demands to or upon the Borrower and BPI in respect of the Loan Documents may be
given or made.

    Section 8.3.   RECORDS AND ACCOUNTS. Each of the Borrower and BPI will (a)
keep, and cause each of its Subsidiaries to keep, true and accurate records and
books of account in which full, true and correct entries in all material
respects will be made in accordance with GAAP and (b) maintain adequate accounts
and reserves for all taxes (including income taxes), contingencies, depreciation
and amortization of its properties and the properties of its Subsidiaries; all
of such reserves may be unfunded.

    Section 8.4.   FINANCIAL STATEMENTS, CERTIFICATES AND INFORMATION. The
Borrower will deliver and cause BPI to deliver (as applicable) to the Agent
(with copies to the Agent for each Bank):

                   (a) as soon as practicable, but in any event not later than
ninety (90) days after the end of each fiscal year of BPI, the audited
consolidated balance sheet of BPI and its Subsidiaries at the end of such year,
and the related audited consolidated statements of income, changes in
shareholder's equity and cash flows for the year then ended, in each case,
setting forth in comparative form the figures as of the end of and for the
previous fiscal year and all such statements to be in reasonable detail,
prepared in accordance with GAAP, and, in each case, accompanied by an auditor's
report prepared

                                      -64-


without qualification by the Accountants (and the Borrower also shall deliver
the foregoing for BPLP on a consolidated basis);

                   (b) as soon as practicable, but in any event not later than
forty-five (45) days after the end of each of its March 31, June 30 and
September 30 fiscal quarters, copies of the unaudited consolidated balance sheet
of BPI and its Subsidiaries, as at the end of such quarter, and the related
unaudited consolidated statements of income, changes in shareholders' equity and
cash flows for the portion of BPI's fiscal year then elapsed, all in reasonable
detail and prepared in accordance with GAAP (which may be provided by inclusion
in the Form 10-Q of BPI filed with the SEC for such period provided pursuant to
clause (i) below), together with a certification by the principal financial or
accounting officer of the Borrower and BPI that the information contained in
such financial statements fairly presents the financial position of BPI and its
Subsidiaries on the date thereof (subject to year-end adjustments none of which
shall be materially adverse) (and the Borrower also shall deliver the foregoing
for BPLP on a consolidated basis);

                   (c) Upon the request of the Agent and as soon as practicable,
but in any event not later than ninety (90) days after the end of each of its
fiscal years, statements of Net Operating Income and outstanding Indebtedness as
at the end of such fiscal year and for the fiscal year then ended in respect of
each Real Estate Asset (including each Borrowing Base Property), each prepared
in accordance with GAAP consistent with the definitions of Net Operating Income
and outstanding Indebtedness used in this Agreement and a summary rent roll in
respect of each Borrowing Base Property, in each case certified by the chief
financial or accounting officer of the Borrower as true and correct in all
material respects;

                   (d) Upon the request of the Agent and as soon as practicable,
but in any event not later than forty-five (45) days after the end of each of
the fiscal quarters of the Borrower, (1) copies of the unaudited statements of
Net Operating Income and outstanding Indebtedness as at the end of such quarter
and for the portion of the fiscal year then elapsed in respect of each Real
Estate Asset (including each Borrowing Base Property), each prepared in
accordance with GAAP consistent with the definitions of Net Operating Income and
outstanding Indebtedness used in this Agreement and certified by the chief
financial or accounting officer of the Borrower to present fairly the Net
Operating Income and outstanding Indebtedness in respect of each such Real
Estate Asset and (ii) an occupancy analysis in respect of each Real Estate Asset
(including each Borrowing Base Property) certified by the chief financial
officer of the Borrower to be true and complete in all material respects;

                   (e) simultaneously with the delivery of the financial
statements referred to in subsections (a) and (b) above, a statement in the form
of EXHIBIT C-2 hereto signed by the chief financial or accounting officer of the
Borrower and (if applicable) reconciliations to reflect changes in GAAP since
the date of such financial statements;

                                      -65-


                   (f) promptly as they become available, a copy of each report
(including any so-called management letters) submitted to the Borrower, BPI or
any of their respective subsidiaries by the Accountants in connection with each
annual audit of the books of the Borrower, BPI or such Subsidiary by such
Accountants or in connection with any interim audit thereof pertaining to any
phase of the business of the Borrower, BPI or any such Subsidiary;

                   (g) contemporaneously with (or promptly after) the filing or
mailing thereof, copies of all material of a financial nature sent to the
holders of any Indebtedness of the Borrower (other than the Loans) for borrowed
money, to the extent that the information or disclosure contained in such
material refers to or could reasonably be expected to have a material adverse
effect on the business, assets, financial condition or prospects, or operations
of BPLP, BPI or, taken as a whole, the BP Group;

                   (h) contemporaneously with the filing or mailing thereof,
copies of all material of a financial nature filed with the SEC or sent to the
stockholders of BPI;

                   (i) as soon as practicable, but in any event not later than
ninety (90) days after the end of each fiscal year of BPI, copies of the Form
10-K statement filed by BPI with the SEC for such fiscal year, and as soon as
practicable, but in any event not later than fifty (50) days after the end of
each fiscal quarter of BPI copies of the Form 10-Q statement filed by BPI with
the SEC for such fiscal quarter, PROVIDED that, in either case, if the SEC has
granted an extension for the filing of such statements, BPI shall deliver such
statements to the Agent within ten (10) days after the filing thereof with the
SEC;

                   (j) from time to time such other financial data and
information about the Borrower, BPI, their respective Subsidiaries, the Real
Estate Assets and the Partially-Owned Real Estate Holding Entities as the Agent
or any Bank (through the Agent) may reasonably request, including without
limitation complete rent rolls, existing environmental reports, and insurance
certificates with respect to the Real Estate Assets (including the Borrowing
Base Properties);

                   (k) in the case of the Borrower and BPI, as soon as
practicable, but in any event not later than ninety (90) days after the end of
each of their respective fiscal years, PRO FORMA projections for the next three
fiscal years;

                   (l) together with the financial statements delivered pursuant
to Section 8.4(a), a certification by the chief financial or accounting officer
of the Borrower of the state and federal taxable income of BPI and its
Subsidiaries as of the end of the applicable fiscal year; and

                   (m) in the event that the definition of "funds from
operations" is revised by the Board of Governors of the National Association of
Real Estate Investment

                                      -66-


Trusts, a report, certified by the chief financial or accounting officer of the
Borrower, of the "funds from operations" of the Borrower based on the definition
as in effect on the date of this Agreement and based on the definition as so
revised from time to time, which such report shall be delivered to the Agent
(with copies to the Agent for each Bank) with the financial statements required
to be delivered pursuant to Section 8.4(b) above; and

                   (n) as soon as practicable, but in any event not later than
ninety (90) days after the end of the fiscal year of BPLP, the unaudited balance
sheet of BPLP at the end of each such year, and the related unaudited statements
of income, changes in partners' capital and cash flows for the year then ended,
in each case setting forth in comparative form the figures for the previous
fiscal year and all such statements to be in reasonable detail, prepared in
accordance with GAAP, together with a certification by the principal financial
or accounting officer of BPLP that the information contained in such financial
statements fairly presents the financial position of BPLP on the date thereof,
and as soon as practicable, but in any event not later than forty-five (45) days
after the end of each of the March 31, June 30 and September 30 fiscal quarters
of BPLP, the unaudited balance sheet of BPLP at the end of each such quarter,
and the related unaudited statements of income, changes in partners' capital and
cash flows for the quarter then ended, in each case setting forth in comparative
form the figures for the previous fiscal quarter and all such statements to be
in reasonable detail, prepared in accordance with GAAP, together with a
certification by the principal financial or accounting officer of BPLP that the
information contained in such financial statements fairly presents the financial
position of BPLP on the date thereof (subject to year-end adjustments none of
which shall be materially adverse).

    Section 8.5.   NOTICES.

                   (a) DEFAULTS. The Borrower will, and will cause BPI, as
applicable, to, promptly after obtaining knowledge of the same, notify the Agent
in writing (with copies to the Agent for each Bank) of the occurrence of any
Default or Event of Default or Non-Material Breach. If any Person shall give any
notice or take any other action in respect of (x) a claimed Default (whether or
not constituting an Event of Default) under this Agreement or (y) a claimed
failure by the Borrower, BPI or any of their respective Subsidiaries, as
applicable, to comply with any term, condition or provision of or under any
note, evidence of Indebtedness, indenture or other obligation in excess of
$10,000,000, individually or in the aggregate, to which or with respect to which
any of them is a party or obligor, whether as principal or surety, and such
failure to comply would permit the holder of such note or obligation or other
evidence of Indebtedness to accelerate the maturity thereof, which acceleration
would have a material adverse effect on BPLP, BPI or, taken as a whole, the BP
Group or the Borrower shall forthwith give written notice thereof to the Agent
and each of the Banks, describing the notice or action and the nature of the
claimed failure to comply.

                                      -67-


                   (b) ENVIRONMENTAL EVENTS. The Borrower will, and will cause
BPI to, promptly give notice in writing to the Agent (with copies to the Agent
for each Bank) (i) upon Borrower's or BPI's obtaining knowledge of any material
violation (as determined by the Borrower or BPI in the exercise of its
reasonable discretion) of any Environmental Law regarding any Real Estate Asset
or Borrower's or BPI's operations, (ii) upon Borrower's or BPI's obtaining
knowledge of any known Release of any Hazardous Substance at, from, or into any
Real Estate Asset which it reports in writing or is reportable by it in writing
to any governmental authority and which is material in amount or nature or which
could materially affect the value of such Real Estate Asset, (iii) upon
Borrower's or BPI's receipt of any notice of material violation of any
Environmental Laws or of any material Release of Hazardous Substances in
violation of any Environmental Laws or any matter that may be a Disqualifying
Environmental Event with respect to any of the Borrowing Base Properties,
including a notice or claim of liability or potential responsibility from any
third party (including without limitation any federal, state or local
governmental officials) and including notice of any formal inquiry, proceeding,
demand, investigation or other action with regard to (A) Borrower's or BPI's or
any other Person's operation of any Real Estate Asset, (B) contamination on,
from or into any Real Estate Asset, or (C) investigation or remediation of
off-site locations at which Borrower or BPI or any of its predecessors are
alleged to have directly or indirectly disposed of Hazardous Substances, or (iv)
upon Borrower's or BPI's obtaining knowledge that any expense or loss has been
incurred by such governmental authority in connection with the assessment,
containment, removal or remediation of any Hazardous Substances with respect to
which Borrower or BPI or any Partially-Owned Real Estate Entity may be liable or
for which a lien may be imposed on any Real Estate Asset; any of which events
described in clauses (i) through (iv) above would have a material adverse effect
on the business, assets or financial condition of the Borrower and its
Subsidiaries, taken as a whole, or constitutes a Disqualifying Environmental
Event with respect to any of the Borrowing Base Properties. As of the date
hereof, the Borrower has notified the Agent and the Banks of the matters
referenced on SCHEDULE 8.5(B), to the extent such matters are disclosed in the
Form 10-K referred to therein.

                   (c) NOTIFICATION OF CLAIMS AGAINST BORROWING BASE PROPERTIES.
The Borrower will, and will cause each Subsidiary to, promptly upon becoming
aware thereof, notify the Agent in writing (with copies to the Agent for each
Bank) of any setoff, claims, withholdings or other defenses to which any of the
Borrowing Base Properties are subject, which (i) would have a material adverse
effect on (x) the business, assets or financial condition of BPLP, BPI or, taken
as a whole, the BP Group, or (y) the value of any such Borrowing Base Property,
or (ii) with respect to such Borrowing Base Property, constitute a Disqualifying
Environmental Event, a Disqualifying Structural Event or a Lien subject to the
bonding or insurance requirement of Section 9.2(viii).

                   (d) NOTICE OF LITIGATION AND JUDGMENTS. The Borrower will,
and will cause BPI and their respective Subsidiaries, to give notice to the
Agent in writing (with copies to the Agent for each Bank) within fifteen (15)
days of becoming aware of any

                                      -68-


litigation or proceedings threatened in writing or any pending litigation and
proceedings an adverse determination in which could materially affect BPLP, BPI
or taken as a whole, the BP Group, or any Borrowing Base Property or to which
the Borrower, BPI or any of their respective Subsidiaries is or is to become a
party involving an uninsured claim against the Borrower, BPI or any of their
respective Subsidiaries that could reasonably be expected to have a materially
adverse effect on BPLP, BPI or, taken as a whole, the BP Group, the respective
properties, business, assets, financial condition or prospects or on the value
or operation of the Borrowing Base Properties and stating the nature and status
of such litigation or proceedings. The Borrower will, and will cause each of BPI
and their respective Subsidiaries to, give notice to the Agent and each of the
Banks, in writing, in form and detail reasonably satisfactory to the Agent and
each of the Banks, within ten (10) days of any judgment not covered by
insurance, final or otherwise, against the Borrower, BPI or any of such
Subsidiaries in an amount in excess of $5,000,000.

                   (e) ACQUISITION OF REAL ESTATE ASSETS. The Borrower shall
notify the Agent (with copies to the Agent for each Bank) in its financial
reports delivered pursuant to Section Section 8.4(a) and (b) of the acquisition
of Real Estate Assets during the applicable quarter by the Borrower or any other
member of the BP Group (other than BPI) (whether or not such acquisition was
made with proceeds of the Loans), which notice shall include, at the Agent's
request, with respect to each such Real Estate Asset, its address, a brief
description and recent photograph, a rent roll summary, a PRO FORMA and historic
(if available) income statement and a summary of the key business terms of such
acquisition, PROVIDED that the failure of the Borrower to provide such notice to
the Agent shall not constitute a Default or Event of Default hereunder.

                   (f) INSOLVENCY EVENTS. The Borrower shall notify the Agent in
writing (with copies to the Agent for each Bank) promptly after the occurrence
of any of the events described in Section 14.1(g) or (h) with respect to any
member of the BP Group other than BPLP and BPI.

    Section 8.6.   EXISTENCE OF BORROWER; MAINTENANCE OF PROPERTIES. The
Borrower will do or cause to be done all things necessary to, and shall,
preserve and keep in full force and effect its respective existence in its
jurisdiction of organization and will do or cause to be done all things
necessary to preserve and keep in full force all of its respective rights and
franchises and those of its respective Subsidiaries each of which in the good
faith judgment of BPLP may be necessary to properly and advantageously conduct
the businesses conducted by it. The Borrower (a) will cause all necessary
repairs, renewals, replacements, betterments and improvements to be made to all
Real Estate Assets owned or controlled by it, all as in the judgment of the
Borrower may be necessary so that the business carried on in connection
therewith may be properly and advantageously conducted at all times, subject to
the terms of the applicable Leases and partnership agreements or other entity
charter documents, and in any event, will keep all of the Real Estate Assets
(for so long as such Real Estate Assets are owned by the Borrower or any of its
Subsidiaries) in a condition consistent with the Real Estate Assets currently
owned or

                                      -69-


controlled by the Borrower or its Subsidiaries, (b) will cause all of its other
properties and those of its Subsidiaries (to the extent controlled by the
Borrower) used or useful in the conduct of its business or the business of its
Subsidiaries to be maintained and kept in good condition, repair and working
order and supplied with all necessary equipment, (c) will not permit BPI to
directly own or lease any Real Estate Asset (except only 100 East Pratt Street,
Baltimore, Maryland so long as all of the economic benefits of such Real Estate
Asset contractually flow to BPLP), and (d) will, and will cause each of its
Subsidiaries to continue to engage primarily in the businesses now conducted by
it and in related businesses, all of the foregoing to the extent necessary to
comply with the other terms and conditions set forth in this Agreement, and in
the case of clauses (a) and (b) above, except to the extent that the failure to
comply with the provisions thereof constitutes a Non-Material Breach.

    Section 8.7.   EXISTENCE OF BPI; MAINTENANCE OF REIT STATUS OF BPI;
MAINTENANCE OF PROPERTIES;. The Borrower will cause BPI to do or cause to be
done all things necessary to preserve and keep in full force and effect BPI's
existence as a Delaware corporation. The Borrower will cause BPI at all times
(i) to maintain its status as a REIT and not to take any action which could lead
to its disqualification as a REIT and (ii) to continue to be listed on a
nationally-recognized stock exchange. Without limitation of Section 9.3(f), the
Borrower will cause BPI not to engage in any business other than the business of
acting as a REIT and serving as the general partner and limited partner of the
Borrower, and as a member, partner or stockholder of Subsidiaries of the
Borrower, including Boston Properties LLC (PROVIDED that BPI's percentage equity
interest in any such Subsidiary shall not exceed 1%), and matters directly
relating thereto, and shall cause BPI to (x) conduct all or substantially all of
its business operations through the Borrower or through subsidiary partnerships
or other entities in which the Borrower owns at least 99% of the economic
interests and (y) own no real property or material personal property other than
(1) through its ownership interests in the Borrower and its Subsidiaries,
including Boston Properties LLC, in compliance with the terms hereof, and (2)
contracts and agreements of the nature described in Schedule 9.1(e). The
Borrower will cause BPI (a) to cause all of its properties and those of its
Subsidiaries used or useful in the conduct of its business or the business of
its Subsidiaries to be maintained and kept in good condition, repair and working
order, and supplied with all necessary equipment, (b) to cause to be made all
necessary repairs, renewals, replacements, betterments and improvements thereof,
all as in the judgment of BPI may be necessary so that the business carried on
in connection therewith may be properly and advantageously conducted at all
times and (c) to cause each of its Subsidiaries to continue to engage primarily
in the businesses now conducted by it and in related businesses, in each case
under clauses (a), (b) and (c) above to the extent, in the good faith judgment
of BPI, necessary to properly and advantageously conduct the businesses being
conducted by it.

    Section 8.8.   INSURANCE. The Borrower will, and will cause BPI to, maintain
with respect to its properties, and will cause each of its Subsidiaries to
maintain with financially sound and reputable insurers, insurance with respect
to such properties and its

                                      -70-


business against such casualties and contingencies as shall be in accordance
with the general practices of businesses engaged in similar activities in
similar geographic areas and in amounts, containing such terms, in such forms
and for such periods as may be reasonable and prudent, unless any failure to do
so does not relate to BPLP or BPI and is a Non-Material Breach.

    Section 8.9.   TAXES. The Borrower will, and will cause BPI and each of
their respective Subsidiaries to, pay or cause to be paid real estate taxes,
other taxes, assessments and other governmental charges against the Real Estate
Assets before the same become delinquent and will duly pay and discharge, or
cause to be paid and discharged, before the same shall become overdue, all
taxes, assessments and other governmental charges imposed upon its sales and
activities, or any part thereof, or upon the income or profits therefrom, as
well as all claims for labor, materials, or supplies that if unpaid might by law
become a lien or charge upon any of the Real Estate Assets, unless any failure
to do so does not relate to BPLP or BPI and is a Non-Material Breach; PROVIDED
that any such tax, assessment, charge, levy or claim need not be paid if the
validity or amount thereof shall currently be contested in good faith by
appropriate proceedings and if the Borrower or BPI shall have set aside on its
books adequate reserves with respect thereto; and PROVIDED further that the
Borrower or BPI will pay all such taxes, assessments, charges, levies or claims
forthwith prior to the consummation of proceedings to foreclose any lien that
may have attached as security therefor. Promptly upon request by the Agent if
required for bank regulatory compliance purposes or similar bank purposes, the
Borrower will provide evidence of the payment of real estate taxes, other taxes,
assessments and other governmental charges against the Real Estate Assets in the
form of receipted tax bills or other form reasonably acceptable to the Agent, or
evidence of the existence of applicable contests as contemplated herein.

    Section 8.10. INSPECTION OF PROPERTIES AND BOOKS. (a) Subject to the rights
of tenants to limit or prohibit such access, as denoted in the applicable
leases, the Borrower will, and will cause BPI to, permit the Agent or any of the
Banks' other designated representatives upon no less than 24 hours notice (which
notice may be given orally or in writing), to visit and inspect any of the
properties of the Borrower, BPI or any of their respective Subsidiaries to
examine the books of account of the Borrower, BPI and their respective
Subsidiaries (and to make copies thereof and extracts therefrom) and to discuss
the affairs, finances and accounts of the Borrower, BPI and their respective
Subsidiaries with, and to be advised as to the same by, its officers, all at
such reasonable times and intervals as the Agent may reasonably request;
PROVIDED that, so long as no Event of Default has occurred and is continuing,
the Borrower shall only be responsible for the costs and expenses incurred by
the Agent in connection with such inspections.

                   (b) The Borrower hereby agrees that each of the Banks and the
Agent (and each of their respective, and their respective affiliates',
employees, officers, directors, agents and advisors (collectively,
"Representatives") is, and has been from the commencement of discussions with
respect to the facility established by the Agreement

                                      -71-


(the "Facility"), permitted to disclose to any and all Persons, without
limitation of any kind, the structure and tax aspects (as such terms are used in
Code sections 6011 and 6111) of the Facility, and all materials of any kind
(including opinions or other tax analyses) that are or have been provided to
such Bank or the Agent related to such structure and tax aspects. In this
regard, each of the Banks and the Agent acknowledges and agrees that its
disclosure of the structure or tax aspects of the Facility is not limited in any
way by an express or implied understanding or agreement, oral or written
(whether or not such understanding or agreement is legally binding).
Furthermore, each of the Banks and the Agent acknowledges and agrees that it
does not know or have reason to know that its use or disclosure of information
relating to the structure or tax aspects of the Facility is limited in any other
manner (such as where the Facility is claimed to be proprietary or exclusive)
for the benefit of any other Person. Notwithstanding the foregoing (i) the Banks
and the Agent shall not disclose any materials or information of any kind or
nature whatsoever which are not specifically permitted to be disclosed in
accordance with the terms of this subparagraph (b) and (ii) in the event of any
change, amendment, modification or clarification of Code sections 6011 and/or
6111 (or any other applicable Section) or any Regulations promulgated
thereunder, or the issuance by any Person of any guidance on which the Banks,
the Agent and the Representatives are entitled to rely or are otherwise bound by
(including, by way of example only, private letter rulings), which in any way
limits or restricts what may be disclosed pursuant to the terms of this
paragraph, or otherwise establishes that such Code sections do not, or are not
intended to, apply to loan facilities such as the Facility (or other similar
transactions), the terms of this subparagraph (b) shall be deemed modified
thereby. In this regard, the Banks and the Agent intend that this transaction
will not be a "confidential transaction" under Code sections 6011, 6111 or 6112,
and the regulations promulgated thereunder.

                   (c) Notwithstanding anything to the contrary herein
(including, without limitation, the provisions of subparagraph (b) above),
neither the Agent nor any Bank may disclose to any Person any information that
constitutes material non-public information regarding the Borrower or its
securities for purposes of Regulation FD of the Securities and Exchange
Commission or any other federal or state securities laws (it being acknowledged
and agreed that the provisions of this Section 8.10 with respect to such
information are reasonably necessary to comply with said Regulation FD and/or
such other federal and state securities laws) (such information referred to
collectively herein as the "BORROWER INFORMATION"), except that each of the
Agent and each of the Banks may disclose Borrower Information (i) to any other
Bank, (ii) to any other person if reasonably incidental to the administration of
the Loans, (iii) upon the order of any court or administrative agency, (iv) upon
the request or demand of any regulatory agency or authority, (v) which has been
publicly disclosed other than as a result of a disclosure by the Agent or any
Bank which is not permitted by this Agreement, (vi) in connection with any
litigation to which the Agent, any Bank, or any other Representative may be a
party, (vii) to the extent reasonably required in connection with the exercise
of any remedy hereunder, (viii) to the Agent's or such Bank's Affiliates, legal
counsel and independent

                                      -72-


auditors or other Represenatives, and (ix) to any actual or proposed participant
or Eligible Assignee of all or part of its rights hereunder.

                   (d) Each of the Banks and the Agent hereby agrees that the
Borrower (and its, and its affiliates', employees, officers, directors, advisors
and agents (collectively "Borrower Representatives") is, and has been from the
commencement of discussions with respect to the Facility, permitted to disclose
to any and all Persons, without limitation of any kind, the structure and tax
aspects (as such terms are used in Code sections 6011 and 6111) of the Facility,
and all materials of any kind (including opinions or other tax analyses) that
are or have been provided to the Borrower related to such structure and tax
aspects. In this regard, the Borrower acknowledges and agrees that its
disclosure of the structure or tax aspects of the Facility is not limited in any
way by an express or implied understanding or agreement, oral or written
(whether or not such understanding or agreement is legally binding).
Furthermore, each of the Borrower, each Bank and the Agent acknowledges and
agrees that it does not know or have reason to know that its use or disclosure
of information relating to the structure or tax aspects of the Facility is
limited in any other manner (such as where the Facility is claimed to be
proprietary or exclusive) for the benefit of any other Person.

                   (e) The provisions of this Section 8.10 supersede any
confidentiality obligations of the Borrower, the Agent or any of the Banks
relating to the Facility under any agreements between or among the Borrower and
the Agent and/or the Banks, as applicable. The parties hereto agree that any
such confidentiality obligations shall be deemed void AB INITIO.

    Section 8.11.  COMPLIANCE WITH LAWS, CONTRACTS, LICENSES, AND PERMITS. The
Borrower will, and will cause BPI to, comply with, and will cause each of their
respective Subsidiaries to comply with (a) all applicable laws and regulations
now or hereafter in effect wherever its business is conducted, including,
without limitation, all Environmental Laws and all applicable federal and state
securities laws, (b) the provisions of its partnership agreement or corporate
charter and other charter documents and by-laws, as applicable, (c) all material
agreements and instruments to which it is a party or by which it or any of its
properties may be bound (including the Real Estate Assets and the Leases) and
(d) all applicable decrees, orders, and judgments, unless such non-compliance
does not relate to BPLP or BPI and constitutes a Non-Material Breach. If at any
time while any Loan or Note or Letter of Credit is outstanding or the Banks have
any obligation to make Loans or issue Letters of Credit hereunder, any Permit
shall become necessary or required in order that the Borrower may fulfill any of
its obligations hereunder, the Borrower and BPI and their respective
Subsidiaries will immediately take or cause to be taken all reasonable steps
within the power of the Borrower or BPI, as applicable, to obtain such Permit
and furnish the Agent with evidence thereof.

    Section 8.12.  USE OF PROCEEDS. Subject at all times to the other provisions
of this Agreement, the Borrower will use the proceeds of the Loans solely for
working capital

                                      -73-


and general corporate purposes. It is agreed by the Banks that, from time to
time, the Borrower may request proceeds of the Loans be used to refinance
certain secured mortgage Indebtedness of the Borrower, in which event, a portion
of the Loans equal to the amount of the advances made hereunder in connection
with such refinancing may, at Borrower's election, be secured by the refinanced
mortgage (a "Refinancing Mortgage"). Any such Refinancing Mortgage would be (i)
required to be in form and substance reasonably satisfactory to the Agent, (ii)
subject to customary terms and conditions reasonably satisfactory to the Agent,
(iii) amended and restated to provide for economic and other terms which are
identical to those of the Loans (e.g., the maturity date shall be amended to be
the Maturity Date hereunder and the interest rate and payment terms will be
amended to be the same as those hereunder, it being further acknowledged that
such modified interest rate may be based upon either a Revolving Credit Loan or
a Bid Rate Loan calculation, as elected by the Borrower pursuant to the terms
hereof) and (iv) subject to being released or transferred by the Agent at the
request of the Borrower. In addition, in connection with each Refinancing
Mortgage, the Agent would agree to provide, at the request of Borrower,
subordination, non-disturbance and attornment agreements in form and substance
reasonably satisfactory to Agent. No Real Estate Asset that is subject to a
Refinancing Mortgage will qualify as an Unencumbered Asset hereunder.

    Section 8.13.  ADDITION OF BORROWING BASE PROPERTY. Prior to the addition of
any Real Estate Asset to the Borrowing Base as a Borrowing Base Property, the
Borrower shall promptly deliver to the Agent (i) the Joinder Documents
(including the documents, instruments, certificates and agreements required
thereby). Upon satisfaction of the requirements of this Section 8.13, and
subject to the compliance of any such additional Borrowing Base Property with
the Borrowing Base Conditions, such Real Estate Asset shall be included as a
Borrowing Base Property.

    Section 8.14.  ADDITIONAL BORROWERS; SOLVENCY OF BORROWERS; REMOVAL OF
BORROWERS.

                   (a) If, after the Closing Date, BPLP wishes to designate as a
Borrowing Base Property a Real Estate Asset that otherwise qualifies as a
Borrowing Base Property but is owned or ground-leased by a Person other than the
Borrower, BPLP shall cause such Person (which Person must be a Wholly-owned
Subsidiary) to become a party to this Agreement and the other applicable Loan
Documents prior to such Real Estate Asset becoming a Borrowing Base Property
hereunder. The liability of each Borrower which is from time to time a Borrower
hereunder shall be joint and several with all other Borrowers for all
Obligations for so long as such Borrower is a Borrower hereunder (PROVIDED that
BPLP shall at all times be a Borrower hereunder). At any time and from time to
time but only for so long as no Default or Event of Default shall then exist,
BPLP may notify Agent, in writing (each, a "Release Notice"), that one (1) or
more Borrowing Base Properties are to be removed from the Borrowing Base. Such
Release Notice shall be accompanied by a Certificate of Compliance in the form
of EXHIBIT C-4, evidencing compliance. Immediately upon receipt of such Release
Notice and Certificate

                                      -74-


of Compliance, such Borrowing Base Properties (each, a "Released Property")
shall be removed from the Borrowing Base and any Wholly-owned Subsidiary which
is the owner of a Released Property and which is then a Borrower (other than
BPLP) hereunder shall be released from its obligations hereunder (including the
Obligations), PROVIDED, HOWEVER, that any such release shall only be effective
as to Obligations arising after the applicable Release Notice (and the
Certificate of Compliance evidencing compliance) is received by Agent. BPLP will
not permit any Borrower (other than BPLP) that owns or ground leases any
Borrowing Base Property to have any Subsidiaries unless such Subsidiary's
business, obligations and undertakings are exclusively related to the business
of such Borrower.

                   (b) Each Borrower and BPI shall remain solvent at all times,
unless such failure to remain solvent does not relate to BPLP or BPI and is a
Non-Material Breach.

    Section 8.15.  FURTHER ASSURANCES. The Borrower will, and will cause BPI to,
cooperate with, the Agent and the Banks and execute such further instruments and
documents as the Banks or the Agent shall reasonably request to carry out to
their satisfaction the transactions contemplated by this Agreement and the other
Loan Documents.

    Section 8.16.  INTEREST RATE PROTECTION. In the event that the Borrower's
floating rate Indebtedness at any time exceeds forty-five percent (45%) of
Consolidated Total Indebtedness, the Borrower shall, upon the Agent's written
request (an "Agent Notice"), maintain in effect interest rate protection
arrangements (by means of hedging techniques or vehicles such as interest rate
swaps, interest rate caps, interest rate corridors or interest rate collars, in
each case to be capped at a rate reasonably satisfactory to the Agent and the
Majority Banks and otherwise in form and substance reasonably satisfactory to
the Agent) for a tenor and in an amount reasonably satisfactory to the Agent and
the Majority Banks, provided that the amount of interest rate protection
required shall not exceed, in any event, the amount of the Borrower's floating
rate Indebtedness which is in excess of forty-five percent (45%) of Consolidated
Total Indebtedness. Once obtained, the Borrower shall maintain such arrangements
in full force and effect as provided therein, and shall not, without the
approval of the Majority Banks, modify, terminate, or transfer such arrangements
during the period in which the Borrower's floating rate Indebtedness exceeds
forty-five percent (45%) of Consolidated Total Indebtedness with respect to any
specific related Agent Notice. The Borrower may, at its option, enter into
additional interest rate protection arrangements permitted pursuant to Section
9.3.

    Section 8.17.  ENVIRONMENTAL INDEMNIFICATION. The Borrower covenants and
agrees that it will indemnify and hold the Agent and each Bank, and each of
their respective Affiliates, harmless from and against any and all claims,
expense, damage, loss or liability incurred by the Agent or any Bank (including
all reasonable costs of legal representation incurred by the Agent or any Bank,
but excluding, as applicable, for the Agent or a Bank any claim, expense,
damage, loss or liability as a result of the gross

                                      -75-


negligence or willful misconduct of the Agent or such Bank or any of their
respective Affiliates) relating to (a) any Release or threatened Release of
Hazardous Substances on any Real Estate Asset; (b) any violation of any
Environmental Laws with respect to conditions at any Real Estate Asset or the
operations conducted thereon; (c) the investigation or remediation of off-site
locations at which the Borrower, BPI or any of their respective Subsidiaries or
their predecessors are alleged to have directly or indirectly disposed of
Hazardous Substances; or (d) any action, suit, proceeding or investigation
brought or threatened with respect to any Hazardous Substances relating to Real
Estate Assets (including, but not limited to, claims with respect to wrongful
death, personal injury or damage to property). It is expressly acknowledged by
the Borrower that, notwithstanding the introductory paragraph of this Section 8,
this covenant of indemnification shall survive the repayment of the amounts
owing under the Notes and this Agreement and the termination of this Agreement
and the obligations of the Banks hereunder and shall inure to the benefit of the
Agent and the Banks and their respective Affiliates, their respective
successors, and their respective assigns under the Loan Documents permitted
under this Agreement.

    Section 8.18.  RESPONSE ACTIONS. The Borrower covenants and agrees that if
any Release or disposal of Hazardous Substances shall occur or shall have
occurred on any Real Estate Asset owned directly or indirectly by the Borrower
or BPI, in violation of applicable Environmental Laws, the Borrower will cause
the prompt containment and removal of such Hazardous Substances and remediation
of such wholly-owned Real Estate Asset as necessary to comply with all
Environmental Laws.

    Section 8.19.  ENVIRONMENTAL ASSESSMENTS. If the Agent in its good faith
judgment, after discussion with the Borrower and review of any environmental
reports provided by the Borrower, has reasonable grounds to believe that a
Disqualifying Environmental Event has occurred with respect to any one or more
of the Borrowing Base Properties, whether or not a Default or an Event of
Default shall have occurred, the Agent may, from time to time, for the purpose
of assessing and determining whether a Disqualifying Environmental Event has in
fact occurred, cause the Borrower to obtain one or more environmental
assessments or audits of such Borrowing Base Property prepared by a
hydrogeologist, an independent engineer or other qualified consultant or expert
approved by the Agent to evaluate or confirm (i) whether any Hazardous
Substances are present in the soil or water at such Borrowing Base Property and
(ii) whether the use and operation of such Borrowing Base Property complies with
all Environmental Laws. Environmental assessments may include without limitation
detailed visual inspections of such Borrowing Base Property including, without
limitation, any and all storage areas, storage tanks, drains, dry wells and
leaching areas, and, if and to the extent reasonable, appropriate and required
pursuant to applicable Environmental Laws, the taking of soil samples, surface
water samples and ground water samples, as well as such other investigations or
analyses as the Agent deems appropriate. All such environmental assessments
shall be at the sole cost and expense of the Borrower; provided, however, the
Agent may not require environmental assessments at the Borrower's expense, with
respect to any Borrowing

                                      -76-


Base Property, more frequently than upon the occurrence of a Release on any
Borrowing Base Property.

    Section 8.20.  EMPLOYEE BENEFIT PLANS.

                   (a) NOTICE. The Borrower will, and will cause BPI to, notify
the Agent (with copies to the Agent for each Bank) within a reasonable period
after the establishment of any Employee Benefit Plan or Guaranteed Pension Plan
by any of them or any of their respective ERISA Affiliates other than those
disclosed in the SEC Filings and no Borrower will, or will permit BPI to,
establish any Employee Benefit Plan, Multiemployer Plan or Guaranteed Pension
Plan which could reasonably be expected to have a material adverse effect on
BPLP, BPI or, taken as a whole, the BP Group.

                   (b) IN GENERAL. Each Employee Benefit Plan maintained by the
Borrower, BPI or any of their respective ERISA Affiliates will be operated in
compliance in all material respects with the provisions of ERISA and, to the
extent applicable, the Code, including but not limited to the provisions
thereunder respecting prohibited transactions.

                   (c) TERMINABILITY OF WELFARE PLANS. With respect to each
Employee Benefit Plan maintained by the Borrower, BPI or any of their respective
ERISA Affiliates which is an employee welfare benefit plan within the meaning of
Section 3(l) or Section 3(2)(B) of ERISA, the Borrower, BPI, or any of their
respective ERISA Affiliates, as the case may be, has the right to terminate each
such plan at any time (or at any time subsequent to the expiration of any
applicable bargaining agreement) without liability other than liability to pay
claims incurred prior to the date of termination.

                   (d) UNFUNDED OR UNDERFUNDED LIABILITIES. The Borrower will
not, and will not permit BPI to, at any time, have accruing or accrued unfunded
or underfunded liabilities with respect to any Employee Benefit Plan, Guaranteed
Pension Plan or Multiemployer Plan, or permit any condition to exist under any
Multiemployer Plan that would create a withdrawal liability, which such
liability could, individually or in the aggregate, reasonably be expected to
have a material adverse effect on BPLP, BPI or, taken as a whole, the BP Group.

    Section 8.21.  NO AMENDMENTS TO CERTAIN DOCUMENTS. The Borrower will not,
and will not permit BPI to, at any time cause or permit its certificate of
limited partnership, agreement of limited partnership (including without
limitation the Agreement of Limited Partnership of the Borrower, articles of
incorporation, by-laws, operating agreement or other charter documents, as the
case may be, to be modified, amended or supplemented in any respect whatever,
without (in each case) the express prior written consent or approval of the
Agent, if such changes would affect BPI's REIT status or otherwise materially
adversely affect the rights of the Agent and the Banks hereunder or under any
other Loan Document.

                                      -77-


    Section 9.     CERTAIN NEGATIVE COVENANTS OF THE BORROWER AND BPI. The
Borrower for itself and on behalf of BPI covenants and agrees that, so long as
any Loan, Letter of Credit or Note is outstanding or any Bank has any obligation
to make any Loans or any Bank has any obligation to issue, extend or renew any
Letters of Credit:

    Section 9.1.   RESTRICTIONS ON LIABILITIES. The Borrower and BPI may, and
may permit their respective Subsidiaries to, create, incur, assume, guarantee or
be or remain liable for, contingently or otherwise, any Liabilities other than
the specific Liabilities which are prohibited under this Section 9.1 (the
"Prohibited Liabilities"), it being agreed that neither the Borrower nor BPI
will, or will permit any Subsidiary to, create, incur, assume, guarantee or be
or remain liable for, contingently or otherwise, singularly or in the aggregate
for any of such Prohibited Liabilities, as follows:

                   (a) Unsecured Indebtedness (excluding the Obligations) which
is incurred under a revolving credit facility with a commercial bank, trust
company, or savings and loan association, PROVIDED that, in the event the
Borrower acquires a Real Estate Asset with respect to which there is any such
unsecured Indebtedness, the Borrower shall have a period of 90 days in which to
repay such Indebtedness in full;

                   (b) Indebtedness which would result in a Default or Event of
Default under Section 10,

                   (c) An aggregate amount in excess of $10,000,000 at any one
time in respect of taxes, assessments, governmental charges or levies and claims
for labor, materials and supplies (other than in respect of properties owned by
Partially-Owned Real Estate Holding Entities) for which payment therefor is
required to be made in accordance with the provisions of Section 8.9 and such
payment is due and delinquent and which is not being contested diligently and in
good faith;

                   (d) An aggregate amount in excess of $10,000,000 at any one
time in respect of uninsured judgments or awards, with respect to which the
applicable periods for taking appeals have expired, or with respect to which
final and unappealable judgments or awards have been rendered, and such
judgments or awards remain unpaid for more than thirty (30) days; and

                   (e) With respect to BPI only, any and all Liabilities other
than (i) the Liabilities existing as of the Closing Date of the kind or nature
described on SCHEDULE 9.1(E), (ii) Liabilities incurred by BPI in the ordinary
course of business and which are of the same or similar kind or nature to those
permitted under subclause (i) above, (iii) Liabilities incurred by BPI in
connection with its maintenance of corporate status, preparation of SEC filings,
accountants' fees and similar administrative matters, and (iv) other Liabilities
incurred by BPI of the same or similar kind or nature as currently exist,

                                      -78-


so long as such Liabilities are not, individually or in the aggregate, material
to BPI, BPLP or, taken as a whole, the BP Group.

    The terms and provisions of this Section 9.1 are in addition to, and not in
limitation of, the covenants set forth in Section 10.

    Without limiting the foregoing, but subject to the other provisions of this
Agreement (including without limitation Section 10), Indebtedness Without
Recourse to any of the Credit Parties or any of their respective assets other
than their respective interests in the Real Estate Assets that are subject to
such Indebtedness Without Recourse is not restricted other than with respect to
BPI, as set forth in subclause (e) above.

    Section 9.2.   RESTRICTIONS ON LIENS, ETC. None of the Borrower, BPI and any
Wholly-owned Subsidiary will: (a) create or incur or suffer to be created or
incurred or to exist any lien, mortgage, pledge, attachment, security interest
or other rights of third parties of any kind upon any of the Borrowing Base
Properties, whether now owned or hereafter acquired (but only for so long as
they remain Borrowing Base Properties), or upon the income or profits therefrom;
(b) acquire, or agree or have an option to acquire, any property or assets upon
conditional sale or other title retention or purchase money security agreement,
device or arrangement in connection with the operation of the Borrowing Base
Properties; (c) suffer to exist for a period of more than thirty (30) days, with
respect to the Borrowing Base Properties, any taxes, assessments, governmental
charges and claims for labor, materials and supplies for which payment thereof
is not being contested or for which payment notwithstanding a contest is
required to be made in accordance with the provisions of Section 8.9 and has not
been timely made and, with respect to any individual Borrowing Base Property, is
in an amount in excess of the lesser of (i) $500,000 and (ii) three percent (3%)
of the fair market value of the applicable Borrowing Base Property; or (d) sell,
assign, pledge or otherwise transfer for security any accounts, contract rights,
general intangibles, chattel paper or instruments, with or without recourse,
relating to the Borrowing Base Properties (the foregoing items (a) through (d)
being sometimes referred to in this Section 9.2 collectively as "Liens"),
PROVIDED that the Borrower, BPI and any Wholly-owned Subsidiary may create or
incur or suffer to be created or incurred or to exist (but only, with respect to
BPI, as set forth in subclause (vi) below to the extent relating to the Real
Estate Asset located at 100 East Pratt Street, Baltimore, Maryland):

                   (i)    Liens securing taxes, assessments, governmental
charges or levies or claims for labor, material and supplies, the Indebtedness
with respect to which is not prohibited by Section 9.1(c) or Section 9.2(c);

                   (ii)   Liens arising out of deposits or pledges made in
connection with, or to secure payment of, worker's compensation, unemployment
insurance, old age pensions or other social security obligations; and deposits
with utility companies and other similar deposits made in the ordinary course of
business;

                                      -79-


                   (iii)  Liens (other than affecting the Borrowing Base
Properties) in respect of judgments or awards, the Indebtedness with respect to
which is not prohibited by Section 9.1(d);

                   (iv)   encumbrances on properties consisting of easements,
rights of way, covenants, zoning and other land-use restrictions, building
restrictions, restrictions on the use of real property and defects and
irregularities in the title thereto; landlord's or lessor's Liens under Leases
to which the Borrower or any wholly-owned Subsidiary is a party or bound;
purchase options granted at a price not less than the market value of such
property; and other minor Liens or encumbrances on properties, none of which
interferes materially and adversely with the use of the property affected in the
ordinary conduct of the business of the Borrower, and which matters (x) do not
individually or in the aggregate have a material adverse effect on the business
of BPLP, BPI or, taken as a whole, the BP Group and (y) do not make title to
such property unmarketable by the conveyancing standards in effect where such
property is located;

                   (v)    any Leases;

                   (vi)   Liens and other encumbrances or rights of others which
exist on the date of this Agreement and which do not otherwise constitute a
breach of this Agreement, including, without limitation, Liens created by or
pursuant to the Organizational Documents of the Borrower with respect to a
restriction on sale or refinancing of a Real Estate Asset that would be an
acceptable Lien under the definition of "Unencumbered Asset", so long as all
such Liens, individually, or in the aggregate, do not have a material adverse
effect on BPLP, BPI or, taken as a whole, the BP Group; PROVIDED that nothing in
this clause (vi) shall be deemed or construed to permit an Borrowing Base
Property to be subject to a Lien to secure Indebtedness;

                   (vii)  as to Real Estate Assets which are acquired after the
date of this Agreement, Liens and other encumbrances or rights of others which
exist on the date of acquisition and which do not otherwise constitute a breach
of this Agreement; provided that nothing in this clause (vii) shall be deemed or
construed to permit a Borrowing Base Property to be subject to a Lien to secure
Indebtedness;

                   (viii) Liens affecting the Borrowing Base Properties in
respect of judgments or awards that are under appeal or have been in force for
less than the applicable period for taking an appeal, so long as execution is
not levied thereunder or in respect of which, at the time, a good faith appeal
or proceeding for review is being diligently prosecuted, and in respect of which
a stay of execution shall have been obtained pending such appeal or review;
PROVIDED that the Borrower shall have obtained a bond or insurance or made other
arrangements with respect thereto, in each case reasonably satisfactory to the
Agent;

                                      -80-


                   (ix)   Liens securing Indebtedness for the purchase price of
capital assets (other than Real Estate Assets but including Indebtedness in
respect of Capitalized Leases for equipment and other equipment leases) to the
extent not otherwise prohibited by Section 9.1; and

                   (x)    other Liens (other than affecting the Borrowing Base
Properties) in connection with any Indebtedness permitted under Section 9.1.

                   Nothing contained in this Section 9.2 shall restrict or limit
the Borrower or any of their respective Wholly-owned Subsidiaries from creating
a Lien in connection with any Real Estate Asset which is not a Borrowing Base
Property and otherwise in compliance with the other terms of this Agreement.

                   BPI shall not create or incur or suffer to be created or
incurred any Lien on any of its directly-owned properties or assets, including,
in any event, its general partner interests and limited partner interests in the
Borrower.

    Section 9.3.   RESTRICTIONS ON INVESTMENTS. None of the Borrower, BPI, or
any of their respective Subsidiaries will make or permit to exist or to remain
outstanding any Investment except, with respect to the Borrower and its
Subsidiaries only, Investments in:

                   (a) marketable direct or guaranteed obligations of the United
States of America that mature within two (2) years from the date of purchase
(including investments in securities guaranteed by the United States of America
such as securities in so-called "overseas private investment corporations");

                   (b) demand deposits, certificates of deposit, bankers
acceptances and time deposits of United States banks having total assets in
excess of $1,000,000,000;

                   (c) securities commonly known as "commercial paper" issued by
a corporation organized and existing under the laws of the United States of
America or any state thereof that at the time of purchase have been rated and
the ratings for which are not less than "P 1" if rated by Moody's, and not less
than "A 1" if rated by S&P;

                   (d) Investments existing on the Closing Date and listed in
the SEC Filings or in the financial statements referred to in Section 7.4;

                   (e) other Investments hereafter in connection with the
acquisition and development of Permitted Properties by the Borrower or any
Wholly-owned Subsidiary of the Borrower, PROVIDED that the aggregate amounts
actually invested by Borrower (or if not invested directly by Borrower, actually
invested by an Affiliate of the Borrower for which the Borrower has any funding
obligation) and such Wholly-owned Subsidiary at any time as Development Costs in
Real Estate Assets Under Development (and without regard to any obligations of
the Borrower or such Subsidiary to provide funds which have

                                      -81-


not yet been invested) will not exceed twenty-five percent (25%) of the Fair
Market Value of Real Estate Assets at the time of any such Investment;

                   (f) subject at all times to the restrictions of Section 9.7
hereof and subject to what is permitted in clause (e) above, so long as no Event
of Default has occurred and is continuing or would occur after giving effect
thereto, Investments (i) in Real Estate Assets, (ii) in interests in
Partially-Owned Real Estate Holding Entities, (iii) in the stock of or other
beneficial interests in Persons whose primary operations consist of the
ownership, development, operation or management of Real Estate Assets or the
ownership of Mortgages, or (iv) consisting of the acquisition of (A) contracts
for the management of real estate assets for third parties unrelated to the
Borrower, or (B) Mortgages, PROVIDED that the aggregate fair market value of
Borrower's and any such Subsidiary's interest in such other businesses
(excluding management and development businesses except to the extent of amounts
actually invested by the Borrower or any such Subsidiary therein) does not
exceed twenty-five percent (25%) of the Consolidated Total Adjusted Asset Value
at the time of any such Investment;

                   (g) any Investments now or hereafter made in any Wholly-owned
Subsidiary;

                   (h) Investments in respect of (1) equipment, inventory and
other tangible personal property acquired in the ordinary course of business,
(2) current trade and customer accounts receivable for services rendered in the
ordinary course of business and payable in accordance with customary trade
terms, (3) advances in the ordinary course of business to employees for travel
expenses, drawing accounts and similar expenditures, (4) prepaid expenses made
in the ordinary course of business;

                   (i) shares of so-called "money market funds" registered with
the SEC under the Investment Company Act of 1940 which maintain a level
per-share value, invest principally in marketable direct or guaranteed
obligations of the United States of America and agencies and instrumentalities
thereof, and have total assets in excess of $50,000,000;

                   (j) Investments made by the Borrower in businesses which are
not in the business of commercial real estate so long as such businesses have
real estate related purposes or such Investment is in connection with a real
estate related transaction, PROVIDED that the aggregate amounts actually
invested by the Borrower in such businesses shall not exceed two percent (2%) of
the Consolidated Total Adjusted Asset Value at the time of each such Investment.
Without limitation of the provisions of the foregoing sentence, the Banks
retroactively increase the amount of the waiver of the restrictions on
Investments set forth in Section 9.3 which is contained in the August 23, 1999
waiver letter in favor of the Borrower by $1,500,000; and

                                      -82-


                   (k) Investments made by the Borrower in Real Estate Assets
constituting multi-family, retail and parking properties, PROVIDED that the
aggregate amounts actually invested by the Borrower in such businesses which are
not ancillary or related to Permitted Properties, shall not exceed five percent
(5%) of the Consolidated Total Adjusted Asset Value at the time of each such
Investment.

    Notwithstanding the foregoing, BPI shall be permitted to make and maintain
(i) Investments in the Borrower, (ii) Investments in the Borrower's Subsidiaries
(including, without limitation, in Boston Properties LLC), PROVIDED that BPI's
percentage equity interest in any such Subsidiary shall not exceed 1%, (iii)
Investments which exist as of the date of this Agreement and are set forth on
SCHEDULE 9.3, and (iv) other Investments which would be permitted by the terms
of this Agreement, including Section 8.7 above. The Borrower shall cause BPI to
contribute to the Borrower, promptly upon, and in any event within 3 Business
Days of, BPI's receipt thereof, 100% of the aggregate proceeds received by BPI
in connection with any offering of stock or debt in BPI (net of fees and
expenses customarily incurred in such offerings).

    Section 9.4.   MERGER, CONSOLIDATION AND DISPOSITION OF ASSETS; ASSETS OF
BPI.

    None of the Borrower, BPI or any of their respective Subsidiaries will:

                   (a) become a party to any merger or consolidation without
prior written approval of the Majority Banks, except that so long as no Default
or Event of Default has occurred and is continuing, or would occur after giving
effect thereto, the merger or consolidation of one or more Persons with and into
the Borrower or BPI shall be permitted in connection with the acquisition of
Real Estate Assets if the Borrower or BPI, as the case may be, is the surviving
entity; PROVIDED that (i) if any such merger or consolidation involves BPI, the
assets acquired (including any equity interests) are, promptly after the
consummation of the acquisition, contributed to the Borrower or one of its
Subsidiaries and all liabilities assumed by BPI in connection with the
acquisition are assumed by the Borrower or such Subsidiary, and (ii) prior to
any such merger or consolidation (other than (x) the merger or consolidation of
one or more Wholly-owned Subsidiaries with and into the Borrower or (y) the
merger or consolidation of two or more Wholly owned Subsidiaries of the
Borrower), the Borrower shall provide to the Agent (with copies to the Agent for
each Bank) a statement in the form of EXHIBIT C-4 hereto signed by the chief
financial officer or treasurer of the Borrower and setting forth in reasonable
detail computations evidencing compliance with the covenants contained in
Section Section 10.1 through 10.7 and certifying, to the best knowledge of the
signatory, that no Default or Event of Default has occurred and is continuing,
or would occur and be continuing after giving effect to such merger or
consolidation and all liabilities, fixed or contingent, pursuant thereto; or

                   (b) without limitation of the other provisions of this
Agreement, and in particular, subject to the provisions of Section 14 relating
to the removal of a

                                      -83-


Real Estate Asset from the Borrowing Base in connection with the curing of any
Default, Event of Default or Non-Material Breach, sell, transfer or otherwise
dispose of any Real Estate Assets or grant a Lien to secure Indebtedness
otherwise permitted hereunder unless no Default or Event of Default would exist
or occur and be continuing after giving effect to any such transaction.

    Section 9.5.   COMPLIANCE WITH ENVIRONMENTAL LAWS. None of the Borrower, BPI
or any Subsidiary will do any of the following: (a) use any of the Real Estate
Assets or any portion thereof as a facility for the handling, processing,
storage or disposal of Hazardous Substances except for quantities of Hazardous
Substances used in the ordinary course of business and in compliance with all
applicable Environmental Laws, (b) cause or permit to be located on any of the
Real Estate Assets any underground tank or other underground storage receptacle
for Hazardous Substances except in compliance with Environmental Laws, (c)
generate any Hazardous Substances on any of the Real Estate Assets except in
compliance with Environmental Laws, or (d) conduct any activity at any Real
Estate Asset or use any Real Estate Asset in any manner so as to cause a Release
in violation of applicable Environmental Laws; unless, with respect to clause
(d) above, any such occurrence would constitute a Non-Material Breach hereunder.

    Section 9.6.   DISTRIBUTIONS.

                   (a) The Borrower will not make (i) annual Distributions in
excess of 90% of "funds from operations"; (ii) Distributions in excess of 100%
of "funds from operations" for more than three consecutive fiscal quarters; or
(iii) any Distributions during any period after any monetary Event of Default
has occurred; PROVIDED, HOWEVER, (a) that the Borrower may at all times
(including while a monetary Event of Default is continuing) make Distributions
to the extent (after taking into account all available funds of BPI from all
other sources) required in order to enable BPI to continue to qualify as a REIT
and (b) in the event that the Borrower cures any such monetary default in clause
(iii) above and the Agent has accepted such cure prior to accelerating the Loan,
the limitation of clause (iii) above shall cease to apply with respect to such
monetary default. The Agent and the Banks acknowledge that, because
extraordinary gains are not included in "funds from operations", the
restrictions on Distributions do not restrict Distributions of extraordinary
gains, and such Distributions of extraordinary gains shall not be included in
the calculation of the percentages set forth above.

                   (b) BPI will not, during any period when any monetary Event
of Default has occurred and is continuing, make any Distributions in excess of
the Distributions required to be made by BPI in order to maintain its status as
a REIT.

    Section 9.7.   HOTEL PROPERTIES. At any time of determination, the hotel
properties shall not constitute more than 25% of the Consolidated Total Adjusted
Asset Value or more than 25% of the number of Real Estate Assets. The Agent
acknowledges that, on the Closing Date, there are one hundred forty two (142)
Real Estate Assets.

                                      -84-


    Section 10.    FINANCIAL COVENANTS; COVENANTS REGARDING BORROWING BASE
PROPERTIES. The Borrower covenants and agrees that, so long as any Loan, Letter
of Credit or Note is outstanding or any Bank has any obligation to make any Loan
or any Bank has any obligation to issue, extend or renew any Letters of Credit:

    Section 10.1.  CONSOLIDATED TOTAL INDEBTEDNESS. As at the end of any fiscal
quarter, Consolidated Total Indebtedness on the last day of such quarter shall
not exceed 60% of Consolidated Total Adjusted Asset Value on the last day of
such quarter, PROVIDED that (i) for a single period of not more than five
consecutive fiscal quarters of the Borrower, Consolidated Total Indebtedness on
the last day of a fiscal quarter may exceed 60% of Consolidated Total Adjusted
Asset Value on the last day of such quarter (but in no event may it exceed 65%
of Consolidated Total Adjusted Asset Value), and (ii) in no event may such five
consecutive fiscal quarters include the fiscal quarter in which the Maturity
Date occurs or the fiscal quarter immediately preceding the fiscal quarter in
which the Maturity Date occurs. Such single five consecutive fiscal quarter
period shall commence with the first fiscal quarter for which the financial
statements pertaining to such quarter evidence Consolidated Total Indebtedness
in excess of 60% of Consolidated Total Adjusted Asset Value on the last day of
such quarter, and shall not be available to the Borrower again, whether or not
the Borrower utilized all five consecutive fiscal quarters.

    Section 10.2.  SECURED CONSOLIDATED TOTAL INDEBTEDNESS. As at the end of any
fiscal quarter, Secured Consolidated Total Indebtedness shall not exceed 55% of
Consolidated Total Adjusted Asset Value on the last day of such quarter.

    Section 10.3.  DEBT SERVICE COVERAGE. As at the end of any fiscal quarter,

                   (A)  the ratio of (i) Consolidated EBITDA for such quarter to
                        (ii) Consolidated Fixed Charges for such quarter
                        (inclusive of any Consolidated Fixed Charges
                        attributable to dividends and distributions (excluding
                        distributions on account of extraordinary gains) paid or
                        required to be paid in such quarter on the Preferred
                        Creditor Equity) shall not be less than 1.50 to 1.0; and

                   (B)  the ratio of (i) Consolidated EBITDA for such quarter to
                        (ii) Consolidated Fixed Charges for such quarter
                        (inclusive of any Consolidated Fixed Charges
                        attributable to dividends and distributions (excluding
                        distributions on account of extraordinary gains) paid or
                        required to be paid in such quarter on the Preferred
                        Equity) shall not be less than 1.30 to 1.0.

    Section 10.4.  [Reserved.]

                                      -85-


    Section 10.5.  NET WORTH. As at the end of any fiscal quarter or any other
date of measurement, the Consolidated Net Worth of the Borrower and its
Subsidiaries shall not be less than the sum of (i) $2,000,000,000 plus (ii) 75%
of the aggregate proceeds received by BPI (net of fees and expenses customarily
incurred in transactions of such type) in connection with any offering of stock
in BPI, PLUS (iii) 75% of the aggregate value of operating units issued by the
Borrower in connection with asset or stock acquisitions (valued at the time of
issuance by reference to the terms of the agreement pursuant to which such units
are issued), in each case after the Closing Date and on or prior to the date
such determination of Consolidated Net Worth is made.

    Section 10.6.  BORROWING BASE PROPERTIES.

                   (a) As at the end of any fiscal quarter or any other date of
measurement, the Borrower shall not permit Unsecured Consolidated Total
Indebtedness (exclusive of Accounts Payable, but including amounts outstanding
under any Loans and the aggregate undrawn face amount of all outstanding Letters
of Credit after giving effect to Loan Requests) to equal or exceed 60% of the
aggregate Borrowing Base Value, PROVIDED that in the event that Consolidated
Total Indebtedness exceeds 60% of Consolidated Total Adjusted Asset Value at any
time, the Borrower shall not permit the Unsecured Consolidated Total
Indebtedness (exclusive of Accounts Payable, but including the outstanding
principal amount of all Loans and the aggregate undrawn face amount of all
outstanding Letters of Credit after giving effect to Loan Requests) to equal or
exceed 55% of the aggregate Borrowing Base Value.

                   (b) No more than 20% of the Borrowing Base Value shall be
derived from any single Borrowing Base Property, PROVIDED that from the Closing
Date through June 30, 2004, 399 Park Avenue (to the extent that it otherwise
qualifies as a Borrowing Base Property) may constitute up to 48% of the
Borrowing Base Value. On July 1, 2004, or if earlier, on the date that 399 Park
Avenue constitutes less than 35% of the Borrowing Base Value, then two (2)
Borrowing Base Properties may constitute up to 55% of the Borrowing Base Value
and such two (2) Borrowing Base Properties (and no others) may exceed the 20%
individual Borrowing Base Property limit referred to above. To evidence
compliance with the foregoing, the Borrower shall submit to the Agent a
compliance certificate in the form of EXHIBIT C-5.

                   (c) For purposes of determining the Borrowing Base Value, the
Net Operating Income of any Borrowing Base Property acquired during such prior
fiscal quarter shall be adjusted on a pro-forma basis by projecting the Net
Operating Income generated by each such acquired Borrowing Base Property for the
portion of the quarter during which it was owned or ground-leased by the
Borrower over the entire quarter.

                   (d) Notwithstanding the Borrowing Base Conditions, in the
event that the Borrower desires to include any Unencumbered Asset in the
Borrowing Base that does not meet one or more of the Borrowing Base Conditions,
any such Unencumbered

                                      -86-


Asset shall only be permitted to be included in the Borrowing Base in the event
that (i) the Borrower has submitted to the Agent a compliance certificate in the
form of EXHIBIT C-5, modified to reflect the non-conformity of the proposed
Borrowing Base Property, and (ii) the Majority Banks have provided the Borrower
with written approval, in their sole discretion, for such non-conforming
Unencumbered Asset to be included in the Borrowing Base. Upon any such written
approval by the Majority Banks, such Unencumbered Asset shall be considered a
Borrowing Base Property for all purposes hereunder, PROVIDED that on the date of
inclusion of any such Unencumbered Asset in the Borrowing Base (and thereafter
in accordance with the terms of this Agreement), such Unencumbered Asset is
otherwise in compliance with the Borrowing Base Conditions other than with
respect to the non-conformity as certified by the Borrower and approved by the
Majority Banks in the compliance certificate submitted by the Borrower under
clause (i) of the preceding sentence, and PROVIDED, FURTHER that there is
otherwise no Default or Event of Default existing upon the date of, or arising
as a result of, the inclusion of such Unencumbered Asset in the Borrowing Base.

    (e)            The Borrowing Base must at all times be comprised of at least
fifteen (15) Real Estate Assets.

    Section 10.7.  BORROWING BASE DEBT SERVICE COVERAGE RATIO. As of the end of
any fiscal quarter or any other date of measurement, the Borrowing Base Debt
Service Coverage Ratio shall not be less than 1.40 to 1.0.

    Section 11.    [Reserved.]

    Section 12.    CONDITIONS TO THE FIRST ADVANCE. The obligations of any Bank
to make the initial Revolving Credit Loans and of the Fronting Bank to issue any
initial Letters of Credit (and to maintain the existing outstanding Loans and
Letters of Credit) shall be subject to the satisfaction of the following
conditions precedent on or prior to the Closing Date:

    Section 12.1.  LOAN DOCUMENTS. Each of the Loan Documents shall have been
duly executed and delivered by the respective parties thereto and shall be in
full force and effect.

    Section 12.2.  CERTIFIED COPIES OF ORGANIZATION DOCUMENTS. The Agent shall
have received (i) from the Borrower a copy, certified as of a recent date by a
duly authorized officer of BPI, in its capacity as general partner of the
Borrower, to be true and complete, of the Agreement of Limited Partnership of
BPLP and any other Organizational Document or other agreement governing the
rights of the partners or other equity owners of the Borrower, and (ii) from BPI
a copy, certified as of a recent date by the appropriate officer of the State of
Delaware to be true and correct, of the corporate charter of BPI, in each case
along with any other organization documents of the Borrower or BPI and their

                                      -87-


respective general partners, as the case may be, and each as in effect on the
date of such certification.

    Section 12.3.  BY-LAWS; RESOLUTIONS. All action on the part of the Borrower
and BPI necessary for the valid execution, delivery and performance by the
Borrower and BPI of this Agreement and the other Loan Documents to which any of
them is or is to become a party shall have been duly and effectively taken, and
evidence thereof satisfactory to the Banks shall have been provided to the
Agent. The Agent shall have received from BPI true copies of its by-laws and the
resolutions adopted by its board of directors authorizing the transactions
described herein and evidencing the due authorization, execution and delivery of
the Loan Documents to which BPI and/or the Borrower is a party, each certified
by the secretary as of a recent date to be true and complete.

    Section 12.4.  INCUMBENCY CERTIFICATE: AUTHORIZED SIGNERS. The Agent shall
have received from BPI an incumbency certificate, dated as of the Closing Date,
signed by a duly authorized officer of BPI and giving the name of each
individual who shall be authorized: (a) to sign, in the name and on behalf of
the Borrower and BPI, as the case may be, each of the Loan Documents to which
the Borrower or BPI is or is to become a party; (b) to make Loan and Conversion
Requests on behalf of the Borrower and (c) to give notices and to take other
action on behalf of the Borrower or BPI as applicable, under the Loan Documents.

    Section 12.5.  TITLE POLICIES. The Agent (on behalf of the Banks) shall have
received copies of the owner's title policies, if any, for all Borrowing Base
Properties for which the Agent has requested copies, and shall have been
permitted to review such other title policies at BPLP as it has requested prior
to the Closing Date.

    Section 12.6.  CERTIFICATES OF INSURANCE. The Agent shall have received, to
the extent available (and if not available on the Closing Date, within thirty
(30) days after the Closing Date) (a) current certificates of insurance as to
all of the insurance maintained by Borrower on the Borrowing Base Properties
(including flood insurance if necessary) from the insurer or an independent
insurance broker, identifying insurers, types of insurance, insurance limits,
and policy terms; and (b) such further information and certificates from
Borrower, its insurers and insurance brokers as the Agent may reasonably
request.

    Section 12.7.  HAZARDOUS SUBSTANCE ASSESSMENTS. To the extent requested by
the Agent, the Agent shall have received hazardous waste site assessment reports
running in favor of the Agent and the Banks concerning Hazardous Substances (or
the threat thereof) and asbestos with respect to the Borrowing Base Properties,
dated no earlier than July 31, 1996, from environmental engineers reasonably
acceptable to the Agent, such reports to be in form and substance satisfactory
to the Agent and each of the Banks.

    Section 12.8.  OPINION OF COUNSEL CONCERNING ORGANIZATION AND LOAN
DOCUMENTS. Each of the Banks and the Agent shall have received favorable
opinions addressed to the Banks

                                      -88-


and the Agent in form and substance reasonably satisfactory to the Banks and the
Agent from Goodwin Procter LLP and state specific local counsel who are
reasonably satisfactory to Agent, each as counsel to the Borrower, BPI and their
respective Subsidiaries, with respect to applicable law, including, without
limitation, Massachusetts law and certain matters of Delaware law.

    Section 12.9.  [Reserved.]

    Section 12.10. STRUCTURAL CONDITION ASSURANCES. To the extent requested by
the Agent, the Agent and each of the Banks shall have received evidence
satisfactory to the Agent and each of the Banks as to the good physical
condition of the Buildings and that utilities and public water and sewer service
is available at the lot lines of the Borrowing Base Properties and connected
directly to the Buildings on the Borrowing Base Properties with all necessary
Permits.

    Section 12.11. FINANCIAL ANALYSIS OF BORROWING BASE PROPERTIES. Each of the
Banks shall have completed, to its satisfaction, a financial analysis of each
Borrowing Base Property, which analysis shall include, without limitation, a
review, with respect to each Borrowing Base Property, of (i) the most recent
rent rolls, (ii) three (3) year historical and projected operating statements,
(iii) cash flow projections, (iv) market data, (v) selected Leases, and (vi)
tenant financial statements, to the extent available. The costs and expenses
incurred by each Bank (other than the Agent) in conducting such analysis shall
be borne by such Bank; PROVIDED that the Borrower will furnish such materials to
the Banks at the Borrower's expense. The Borrower agrees that at the request of
any Bank it will furnish the materials described in this Section 12.11 to such
Bank after the Closing Date.

    Section 12.12. INSPECTION OF BORROWING BASE PROPERTIES. At the Agent's
election, the Agent shall have completed to its satisfaction, and at the
Borrower's expense, an inspection of the Borrowing Base Properties which the
Agent has not inspected in the one (1) year period prior to the Closing Date.

    Section 12.13. CERTIFICATIONS FROM GOVERNMENT OFFICIALS. The Agent shall
have received long-form certifications from government officials evidencing the
legal existence, good standing and foreign qualification of the Borrower and
BPI, along with a certified copy of the certificate of limited partnership of
the Borrower, all as of the most recent practicable date.

    Section 12.14. [Reserved.]

    Section 12.15. PROCEEDINGS AND DOCUMENTS. All proceedings in connection with
the transactions contemplated by this Agreement, the other Loan Documents and
all other documents incident thereto shall be satisfactory in form and substance
to each of the Banks and to the Agent's counsel, and the Agent, each of the
Banks and such counsel

                                      -89-


shall have received all information and such counterpart originals or certified
or other copies of such documents as the Agent may reasonably request.

    Section 12.16. FEES. The Borrower shall have paid to the Agent, for the
accounts of the Banks or for its own account, as applicable, all of the fees and
expenses that are due and payable as of the Closing Date in accordance with this
Agreement and with any fee letter of even date herewith between the Borrower and
the Agent.

    Section 12.17. CLOSING CERTIFICATE; COMPLIANCE CERTIFICATE. The Borrower
shall have delivered a Closing Certificate to the Agent, the form of which is
attached hereto as EXHIBIT E. The Borrower shall have delivered a compliance
certificate in the form of EXHIBIT C-7 hereto evidencing compliance with the
covenants set forth in Section 10 on a PRO FORMA basis.

    Section 12.18. PARTNERSHIP DOCUMENTS. The Agent shall have received from the
Borrower true copies of all Partnership Documents.

    Section 12.19. RELEASE DOCUMENTS. The Agent shall have delivered to the
Borrower appropriate release documentation necessary to release all, if any,
security interests granted by the Borrower in the Borrowing Base Properties,
including, without limitation, appropriate releases of mortgages and deeds of
trust and UCC termination statements.

    Section 13.    CONDITIONS TO ALL BORROWINGS. The obligations of any Bank to
make any Loan and of any Bank to issue, extend or renew any Letter of Credit, in
each case, whether on or after the Closing Date, shall also be subject to the
satisfaction of the following conditions precedent:

    Section 13.1.  REPRESENTATIONS TRUE; NO EVENT OF DEFAULT; COMPLIANCE
CERTIFICATE. Each of the representations and warranties made by or on behalf of
the Borrower, BPI or any of their respective Subsidiaries contained in this
Agreement, the other Loan Documents or in any document or instrument delivered
pursuant to or in connection with this Agreement shall be true as of the date as
of which they were made and shall also be true at and as of the time of the
making of each Loan or the issuance, extension or renewal of each Letter of
Credit, with the same effect as if made at and as of that time (except (i) to
the extent of changes resulting from transactions contemplated or not prohibited
by this Agreement or the other Loan Documents (including, without limitation,
the fact that a Real Estate Asset may cease to be a Borrowing Base Property
pursuant to the terms of this Agreement) and changes occurring in the ordinary
course of business, (ii) to the extent that such representations and warranties
relate expressly to an earlier date and (iii) to the extent otherwise
represented by the Borrower with respect to the representation set forth in
Section 7.10); and no Default or Event of Default under this Agreement shall
have occurred and be continuing on the date of any Loan Request or on the
Drawdown Date of any Loan. Each of the Banks shall have received a certificate
of the Borrower signed by an authorized officer of the Borrower as provided in
Section 2.4(iv)(c).

                                      -90-


    Section 13.2.  NO LEGAL IMPEDIMENT. No change shall have occurred any law or
regulations thereunder or interpretations thereof that in the reasonable
opinion, as determined in good faith, of the Agent or any Bank would make it
illegal for any Bank to make such Loan or to participate in the issuance,
extension or renewal of such Letter of Credit or, in the reasonable opinion, as
determined in good faith, of the Agent, would make it illegal to issue, extend
or renew such Loan or Letter of Credit.

    Section 13.3.  GOVERNMENTAL REGULATION. Each Bank shall have received such
statements in substance and form reasonably satisfactory to such Bank as such
Bank shall reasonably require in good faith for the purpose of compliance with
any applicable regulations of the Comptroller of the Currency or the Board of
Governors of the Federal Reserve System.

    Section 14.    EVENTS OF DEFAULT; ACCELERATION; ETC..

    Section 14.1.  EVENTS OF DEFAULT AND ACCELERATION. If any of the following
events ("Events of Default") shall occur:

                   (a) the Borrower shall fail to pay any principal of the Loans
when the same shall become due and payable;

                   (b) the Borrower shall fail to pay any interest on the Loans
or any other sums due hereunder or under any of the other Loan Documents
(including, without limitation, amounts due under Section 8.17) when the same
shall become due and payable, and such failure continues for three (3) days
(PROVIDED that in the case of such sums due other than for interest, the
Borrower shall have received from the Agent notice of the nature and amount of
such other amounts and that payment therefor is due);

                   (c) the Borrower, BPI or any of their respective Subsidiaries
shall fail to comply, or to cause BPI to comply, as the case may be, with any of
the respective covenants contained in the following:

                            (i)    Section 8.1 (except with respect to
                       principal, interest and other sums covered by clauses (a)
                       or (b) above);

                            (ii)   Section 8.5 (clauses (a) through (d)), unless
                       such failure is cured within fifteen (15) Business Days;

                            (iii)  Section 8.6 (as to the legal existence of
                       Borrower), unless such breach relates to a Borrower other
                       than BPLP and is a Non-Material Breach and Section 8.6
                       (as it relates to BPI);

                            (iv)   Section 8.7 (as to the legal existence and
                       REIT status of BPI or as it otherwise relates to BPI);

                                      -91-


                            (v)    Section 8.10, unless such failure is cured
                       within three (3) Business Days;

                            (vi)   Section 8.12;

                            (vii)  Section 8.13;

                            (viii) Section 8.14, unless, with respect solely to
                       the last sentence of clause (a) of Section 8.14, such
                       failure is cured within thirty (30) days;

                            (ix)   Section 8.16;

                            (x)    Section 9.1;

                            (xi)   Section 9.2 (pertaining to liens, mortgages,
                       pledges, attachments or other security interests with
                       respect to Borrowing Base Properties) unless (1) with
                       respect solely to such liens or attachments which are not
                       affirmatively created or incurred, such failure is cured
                       within thirty (30) days (with no double-counting of any
                       cure period set forth in Section 9.2) or (2) such failure
                       is a breach which is a Non-Material Breach or Section 9.2
                       (pertaining to BPI);

                            (xii)  Section 9.3;

                            (xiii) Section 9.4;

                            (xiv)  Section 9.6;

                            (xv)   Section 9.7; and

                            (xvi)  Section 10;

                   (d) the Borrower, BPI or any of their respective Subsidiaries
shall fail to perform, or to cause BPI to perform, any other term, covenant or
agreement contained herein or in any of the other Loan Documents (other than
those specified elsewhere in this Section 14) and such failure continues for
thirty (30) days after written notice of such failure from the Agent (such
notice not, however, being required for any failure with respect to which the
Borrower is otherwise obligated hereunder to notify the Agent or the Banks),
PROVIDED, HOWEVER, that if the Borrower is diligently and in good faith
prosecuting a cure of any such failure or breach that is capable of being cured
(all as determined by the Agent in its reasonable and good faith judgment), the
Borrower shall be permitted an

                                      -92-


additional thirty (30) days (but in no event more than an aggregate of sixty
(60) days after any such initial written notice from the Agent) to effect such
cure;

                   (e) any representation or warranty made by or on behalf of
the Borrower, BPI or any of their respective Subsidiaries in this Agreement or
any of the other Loan Documents shall prove to have been false in any material
respect upon the date when made or deemed to have been made or repeated and the
same is not otherwise specified herein to be a Non-Material Breach;

                   (f) the Borrower or any of its Subsidiaries or, to the extent
of Recourse to the Borrower or such Subsidiaries thereunder, any of their
respective Affiliates, shall fail to pay at maturity, or within any applicable
period of grace, any obligation for borrowed money or credit received or in
respect of any Capitalized Leases (other than non-recourse obligations or
credit), which is in excess of $50,000,000, either individually or in the
aggregate, or fail to observe or perform any material term, covenant, condition
or agreement contained in any agreement, document or instrument by which it is
bound evidencing, securing or otherwise relating to such Recourse obligations,
evidencing or securing borrowed money or credit received or in respect of any
Capitalized Leases for such period of time (after the giving of appropriate
notice if required) as would permit the holder or holders thereof or of any
obligations issued thereunder in excess of $50,000,000, either individually or
in the aggregate, to accelerate the maturity thereof; PROVIDED, HOWEVER that
notwithstanding the foregoing, (i) no Event of Default shall occur pursuant to
this subparagraph (f) unless and until the holder or holders of such Recourse
Indebtedness have declared an event of default beyond any applicable notice and
grace periods, if any, on in excess of $50,000,000 of such Recourse Indebtedness
either individually or in the aggregate, and (ii) with respect solely to any
such Recourse Indebtedness of a Subsidiary or Affiliate of the Borrower (not
including any such Indebtedness which is Recourse to the Borrower), no Event of
Default shall occur pursuant to this subparagraph (f) if, upon the occurrence of
such event, the Borrower, promptly after obtaining knowledge of the same,
notifies the Agent in writing (with copies to the Agent for each Bank) of such
event and includes with such notice a Compliance Certificate in the form of
Exhibit C-6 evidencing to the satisfaction of the Agent that, as of the date
thereof, the Borrower is in compliance with all of the covenants set forth in
Section 10 after excluding such Subsidiary or Affiliate, and any Real Estate
Asset owned by such Subsidiary or Affiliate, from the calculation of such
covenants;

                   (g) any of BPLP, BPI or any of their respective Subsidiaries
shall make an assignment for the benefit of creditors, or admit in writing its
inability to pay or generally fail to pay its debts as they mature or become
due, or shall petition or apply for the appointment of a trustee or other
custodian, liquidator or receiver of any of BPLP, BPI or any of their respective
Subsidiaries or of any substantial part of the properties or assets of any of
such parties or shall commence any case or other proceeding relating to any of
the BPLP, BPI or any of their respective Subsidiaries under any bankruptcy,
reorganization, arrangement, insolvency, readjustment of debt, dissolution or
liquidation

                                      -93-


or similar law of any jurisdiction, now or hereafter in effect, or shall take
any action to authorize or in furtherance of any of the foregoing, or if any
such petition or application shall be filed or any such case or other proceeding
shall be commenced against any of BPLP, BPI or any of their respective
Subsidiaries and (i) any of BPLP, BPI or any of their respective Subsidiaries
shall indicate its approval thereof, consent thereto or acquiescence therein or
(ii) any such petition, application, case or other proceeding shall continue
undismissed, or unstayed and in effect, for a period of ninety (90) days,
except, with respect solely to such parties other than BPLP and BPI, any of the
foregoing constitutes a Non-Material Breach;

                   (h) a decree or order is entered appointing any trustee,
custodian, liquidator or receiver or adjudicating any of BPLP, BPI or any of
their respective Subsidiaries bankrupt or insolvent, or approving a petition in
any such case or other proceeding, or a decree or order for relief is entered in
respect of any of BPLP, BPI or any of their respective Subsidiaries in an
involuntary case under federal bankruptcy laws as now or hereafter constituted,
except, with respect solely to such parties other than BPLP and BPI, any of the
foregoing constitutes a Non-Material Breach;

                   (i) there shall remain in force, undischarged, unsatisfied
and unstayed, for more than thirty (30) days, whether or not consecutive, any
uninsured final judgment against any of BPLP, BPI or any of their respective
Subsidiaries that, with other outstanding uninsured final judgments,
undischarged, unsatisfied and unstayed, against any of such parties exceeds in
the aggregate $10,000,000, except, with respect solely to such parties other
than BPLP and BPI, any of the foregoing constitutes a Non-Material Breach;

                   (j) any of the Loan Documents or any material provision of
any Loan Document shall be canceled, terminated, revoked or rescinded otherwise
than in accordance with the terms thereof or with the express prior written
agreement, consent or approval of the Agent, or any action at law, suit or in
equity or other legal proceeding to make unenforceable, cancel, revoke or
rescind any of the Loan Documents shall be commenced by or on behalf of the
Borrower or any of its Subsidiaries or BPI or any of its Subsidiaries, or any
court or any other governmental or regulatory authority or agency of competent
jurisdiction shall make a determination that, or issue a judgment, order, decree
or ruling to the effect that, any one or more of the Loan Documents is illegal,
invalid or unenforceable as to any material terms thereof;

                   (k) any "Event of Default" or default (after notice and
expiration of any period of grace, to the extent provided, as defined or
provided in any of the other Loan Documents, shall occur and be continuing;

                   (l) with respect to any Guaranteed Pension Plan, an ERISA
Reportable Event shall have occurred and the Majority Banks shall have
determined in their reasonable discretion that such event reasonably could be
expected to result in

                                      -94-


liability of the Borrower or any of its Subsidiaries or BPI or any of its
Subsidiaries to the PBGC or such Guaranteed Pension Plan in an aggregate amount
exceeding $10,000,000 and such event in the circumstances occurring reasonably
could constitute grounds for the termination of such Guaranteed Pension Plan by
the PBGC or for the appointment by the appropriate United States District Court
of a trustee to administer such Guaranteed Pension Plan; or a trustee shall have
been appointed by the United States District Court to administer such Plan; or
the PBGC shall have instituted proceedings to terminate such Guaranteed Pension
Plan;

                   (m) subject to the Borrower's right to remove Real Estate
Assets from the Borrowing Base in accordance with the provisions set forth below
in this Section 14, the failure of any of the Real Estate Assets being included
from time to time as Borrowing Base Properties to comply with any of the
conditions set forth in the definition of Borrowing Base Properties; or

                   (n) without limitation of the other provisions of this
Section 14.1, BPI shall at any time fail to be the sole general partner of BPLP
or shall at any time be in contravention of any of the requirements contained in
Section 9.1(e) hereof, the last paragraph of Section 9.2 hereof, or Section 9.3
(including, without limitation, the last paragraph of Section 9.3);

                   then, and in any such event, so long as the same may be
continuing, the Agent may, and upon the request of the Majority Banks shall, by
notice in writing to the Borrower, declare all amounts owing with respect to
this Agreement, the Notes and the other Loan Documents and all Reimbursement
Obligations to be, and they shall thereupon forthwith become, immediately due
and payable without presentment, demand, protest or other notice of any kind,
all of which are hereby expressly waived by the Borrower, BPI and each of their
respective Subsidiaries; PROVIDED that in the event of any Event of Default
specified in Section 14.1(g) or 14.1(h), all such amounts shall become
immediately due and payable automatically and without any requirement of notice
from any of the Banks or the Agent or action by the Banks or the Agent.

                   For purposes of this Section 14, the term "Non-Material
Breach" shall refer to a breach of any representation, warranty or covenant
contained in this Agreement to which the term "Non-Material Breach" is expressly
applied herein, but only to the extent such breach does not (A) materially
adversely affect the business, properties or financial condition of BPLP, BPI
or, taken as a whole, the BP Group or (B) adversely affect the ability of BPLP,
BPI or, taken as a whole, the BP Group, to fulfill the Obligations to the Banks
and the Agent (including, without limitation, to repay all amounts outstanding
on the Loans, together with interest and charges thereon when due).

                   Notwithstanding the foregoing provisions of this Section 14.1
and in addition to the provisions set forth in the immediately preceding
paragraph, in the event of a Default, Event of Default or Non-Material Breach
arising as a result of the inclusion of any Real Estate Asset in the Borrowing
Base at any particular time of reference, if such Default,

                                      -95-


Event of Default or Non-Material Breach is capable of being cured by the
exclusion of such Real Estate Asset from the Borrowing Base and from all other
covenant calculations under Section 10 or otherwise, the Borrower shall be
permitted a period not to exceed ten (10) days to submit to the Agent (with
copies to the Agent for each Bank) a compliance certificate in the form of
EXHIBIT C-4 hereto evidencing compliance with Section 2.1 and with all of the
covenants set forth in Section 10 (with calculations evidencing such compliance
after excluding from Borrowing Base Net Operating Income all of the Net
Operating Income generated by the Real Estate Asset to be excluded from the
Borrowing Base) and with the Borrowing Base Conditions, and otherwise certifying
that, after giving effect to the exclusion of such Real Estate Asset from the
Borrowing Base, no Default, Event of Default or Non-Material Breach will be
continuing.

    Section 14.2.  TERMINATION OF COMMITMENTS. If any one or more Events of
Default specified in Section 14.1(g) or Section 14.1(h) shall occur, any unused
portion of the Commitments or other commitments to extend credit hereunder shall
forthwith terminate and the Banks shall be relieved of all obligations to make
Loans to the Borrower and the Agent and any Fronting Bank shall be relieved of
all further obligations to issue, extend or renew Letters of Credit. If any
other Event of Default shall have occurred and be continuing, whether or not the
Banks shall have accelerated the maturity of the Loans pursuant to Section 14.1,
any Bank may, by notice to the Borrower, terminate the unused portion of that
Bank's Commitment or other commitment to extend credit hereunder, and upon such
notice being given such unused portion of such Commitment or other commitment
shall terminate immediately, such Bank shall be relieved of all further
obligations to make Loans, the Agent and any Fronting Bank shall be relieved of
all further obligations to issue, extend or renew Letters of Credit and the
Total Commitments shall be reduced accordingly. No such termination of a
Commitment or other commitment to extend credit hereunder shall relieve the
Borrower of any of the Obligations or any of its existing obligations to such
Bank arising under other agreements or instruments.

    Section 14.3.  REMEDIES. In the event that one or more Events of Default
shall have occurred and be continuing, whether or not the Banks shall have
accelerated the maturity of the Loans pursuant to Section 14.1, the Majority
Banks may direct the Agent to proceed to protect and enforce the rights and
remedies of the Agent and the Banks under this Agreement, the Notes, any or all
of the other Loan Documents or under applicable law by suit in equity, action at
law or other appropriate proceeding (including for the specific performance of
any covenant or agreement contained in this Agreement or the other Loan
Documents or any instrument pursuant to which the Obligations are evidenced and,
to the full extent permitted by applicable law, the obtaining of the EX PARTE
appointment of a receiver), and, if any amount shall have become due, by
declaration or otherwise, proceed to enforce the payment thereof or any other
legal or equitable right or remedy of the Agent and the Banks under the Loan
Documents or applicable law. No remedy herein conferred upon the Banks or the
Agent or the holder of any Note or purchaser of any Letter of Credit
Participation is intended to be exclusive of any other remedy and each and every
remedy shall be cumulative and shall be in addition to every other remedy

                                      -96-


given hereunder or under any of the other Loan Documents or now or hereafter
existing at law or in equity or by statute or any other provision of law.

    Section 15.    SETOFF. Neither the Agent nor any of the Banks shall have any
right of set-off or the like with respect to the Obligations against any assets
of the Borrower, BPI, their respective Subsidiaries or any Partially-Owned
Entity.

    Section 16.    THE AGENT.

    Section 16.1.  AUTHORIZATION. (a) The Agent is authorized to take such
action on behalf of each of the Banks and to exercise all such powers as are
hereunder and under any of the other Loan Documents and any related documents
delegated to the Agent, together with such powers as are reasonably incident
thereto, PROVIDED that no duties or responsibilities not expressly assumed
herein or therein shall be implied to have been assumed by the Agent. The
relationship between the Agent and the Banks is and shall be that of agent and
principal only, and nothing contained in this Agreement or any of the other Loan
Documents shall be construed to constitute the Agent as a trustee or fiduciary
for any Bank.

                   (b) The Borrower, without further inquiry or investigation,
shall, and is hereby authorized by the Banks to, assume that all actions taken
by the Agent hereunder and in connection with or under the Loan Documents are
duly authorized by the Banks. The Banks shall notify Borrower of any successor
to Agent by a writing signed by Majority Banks, which successor shall be
reasonably acceptable to the Borrower so long as no Default or Event of Default
has occurred and is continuing. The Borrower acknowledges that any Bank which
acquires Fleet is acceptable as a successor to the Agent.

    Section 16.2.  EMPLOYEES AND AGENTS. The Agent may exercise its powers and
execute its duties by or through employees or agents and shall be entitled to
take, and to rely on, advice of counsel concerning all matters pertaining to its
rights and duties under this Agreement and the other Loan Documents. The Agent
may utilize the services of such Persons as the Agent in its sole discretion may
reasonably determine, and all reasonable fees and expenses of any such Persons
shall be paid by the Borrower.

    Section 16.3.  NO LIABILITY. Neither the Agent, nor any of its shareholders,
directors, officers or employees nor any other Person assisting them in their
duties nor any agent or employee thereof, shall be liable for any waiver,
consent or approval given or any action taken, or omitted to be taken, in good
faith by it or them hereunder or under any of the other Loan Documents, or in
connection herewith or therewith, or be responsible for the consequences of any
oversight or error of judgment whatsoever, except that the Agent may be liable
for losses due to its willful misconduct or gross negligence.

                                      -97-


    Section 16.4.  NO REPRESENTATIONS. The Agent shall not be responsible for
the execution or validity or enforceability of this Agreement, the Notes, the
Letters of Credit, or any of the other Loan Documents or for the validity,
enforceability or collectibility of any such amounts owing with respect to the
Notes, or for any recitals or statements, warranties or representations made
herein or in any of the other Loan Documents or in any certificate or instrument
hereafter furnished to it by or on behalf of BPI or the Borrower or any of their
respective Subsidiaries, or be bound to ascertain or inquire as to the
performance or observance of any of the terms, conditions, covenants or
agreements in this Agreement or the other Loan Documents. The Agent shall not be
bound to ascertain whether any notice, consent, waiver or request delivered to
it by the Borrower or BPI or any holder of any of the Notes shall have been duly
authorized or is true, accurate and complete. The Agent has not made nor does it
now make any representations or warranties, express or implied, nor does it
assume any liability to the Banks, with respect to the credit worthiness or
financial condition of the Borrower or any of its Subsidiaries or BPI or any of
the Subsidiaries or any tenant under a Lease or any other entity. Each Bank
acknowledges that it has, independently and without reliance upon the Agent or
any other Bank, and based upon such information and documents as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement.

    Section 16.5.  PAYMENTS.

                   (a) A payment by the Borrower to the Agent hereunder or any
of the other Loan Documents for the account of any Bank shall constitute a
payment to such Bank. The Agent agrees to distribute to each Bank such Bank's
PRO RATA share of payments received by the Agent for the account of the Banks,
as provided herein or in any of the other Loan Documents. All such payments
shall be made on the date received, if before 1:00 p.m., and if after 1:00 p.m.,
on the next Business Day. If payment is not made on the day received, the funds
shall be invested by the Agent in overnight obligations, and interest thereon
paid PRO RATA to the Banks.

                   (b) If in the reasonable opinion of the Agent the
distribution of any amount received by it in such capacity hereunder, under the
Notes or under any of the other Loan Documents might involve it in material
liability, it may refrain from making distribution until its right to make
distribution shall have been adjudicated by a court of competent jurisdiction,
PROVIDED that the Agent shall invest any such undistributed amounts in overnight
obligations on behalf of the Banks and interest thereon shall be paid PRO RATA
to the Banks. If a court of competent jurisdiction shall adjudge that any amount
received and distributed by the Agent is to be repaid, each Person to whom any
such distribution shall have been made shall either repay to the Agent its
proportionate share of the amount so adjudged to be repaid or shall pay over the
same in such manner and to such Persons as shall be determined by such court.

                   (c) Notwithstanding anything to the contrary contained in
this Agreement or any of the other Loan Documents, any Bank that fails (i) to
make available

                                      -98-


to the Agent its PRO RATA share of any Loan or to purchase any Letter of Credit
Participation or (ii) to adjust promptly such Bank's outstanding principal and
its PRO rata Commitment Percentage as provided in Section 2.1, shall be deemed
delinquent (a "Delinquent Bank") and shall be deemed a Delinquent Bank until
such time as such delinquency is satisfied. A Delinquent Bank shall be deemed to
have assigned any and all payments due to it from the Borrower, whether on
account of outstanding Loans, interest, fees or otherwise, to the remaining
nondelinquent Banks for application to, and reduction of, their respective PRO
RATA shares of all outstanding Loans. The Delinquent Bank hereby authorizes the
Agent to distribute such payments to the nondelinquent Banks in proportion to
their respective PRO RATA shares of all outstanding Loans. If not previously
satisfied directly by the Delinquent Bank, a Delinquent Bank shall be deemed to
have satisfied in full a delinquency when and if, as a result of application of
the assigned payments to all outstanding Loans of the nondelinquent Banks, the
Banks' respective PRO RATA shares of all outstanding Loans have returned to
those in effect immediately prior to such delinquency and without giving effect
to the nonpayment causing such delinquency.

    Section 16.6.  HOLDERS OF NOTES. The Agent may deem and treat the payee of
any Notes or the purchaser of any Letter of Credit Participation as the absolute
owner or purchaser thereof for all purposes hereof until it shall have been
furnished in writing with a different name by such payee or by a subsequent
holder, assignee or transferee.

    Section 16.7.  INDEMNITY. The Banks ratably and severally agree hereby to
indemnify and hold harmless the Agent and its Affiliates from and against any
and all claims, actions and suits (whether groundless or otherwise), losses,
damages, costs, expenses (including any expenses for which the Agent has not
been reimbursed by the Borrower as required by Section 17), and liabilities of
every nature and character arising out of or related to this Agreement, the
Notes, or any of the other Loan Documents or the transactions contemplated or
evidenced hereby or thereby, or the Agent's actions taken hereunder or
thereunder, except to the extent that any of the same shall be directly caused
by the Agent's willful misconduct or gross negligence.

    Section 16.8.  AGENT AS BANK. In its individual capacity as a Bank, Fleet
shall have the same obligations and the same rights, powers and privileges in
respect to its Commitment and the Loans made by it, and as the holder of any of
the Notes and as the purchaser of any Letter of Credit Participations, as it
would have were it not also the Agent.

    Section 16.9.  NOTIFICATION OF DEFAULTS AND EVENTS OF DEFAULT. Each Bank
hereby agrees that, upon learning of the existence of a Default or an Event of
Default, it shall (to the extent notice has not previously been provided)
promptly notify the Agent thereof. The Agent hereby agrees that upon receipt of
any notice under this Section 16.9 it shall promptly notify the other Banks of
the existence of such Default or Event of Default.

    Section 16.10. DUTIES IN THE CASE OF ENFORCEMENT. In case one or more Events
of Default have occurred and shall be continuing, and whether or not
acceleration of the

                                      -99-


Obligations shall have occurred, the Agent shall, if (a) so requested by the
Majority Banks and (b) the Banks have provided to the Agent such additional
indemnities and assurances against expenses and liabilities as the Agent may
reasonably request, proceed to enforce the provisions of this Agreement and
exercise all or any such other legal and equitable and other rights or remedies
as it may have in respect of enforcement of the Banks' rights against the
Borrower and its Subsidiaries under this Agreement and the other Loan Documents.
The Majority Banks may direct the Agent in writing as to the method and the
extent of any such enforcement, the Banks (including any Bank which is not one
of the Majority Banks) hereby agreeing to ratably and severally indemnify and
hold the Agent harmless from all liabilities incurred in respect of all actions
taken or omitted in accordance with such directions, PROVIDED that the Agent
need not comply with any such direction to the extent that the Agent reasonably
believes the Agent's compliance with such direction to be unlawful or
commercially unreasonable in any applicable jurisdiction.

    Section 16.11. SUCCESSOR AGENT. Fleet, or any successor Agent, may resign as
Agent at any time by giving at least 30 days prior written notice thereof to the
Banks and to the Borrower. The Majority Banks may remove the Agent in the event
of the Agent's willful misconduct or gross negligence or in the event that the
Agent ceases to hold a Commitment under this Agreement. In addition, the
Borrower may remove the Agent in the event that the Agent holds (without
participation) less than the Minimum Commitment, PROVIDED that if the Agent
holds less than the Minimum Commitment at any time as a result of the merger or
consolidation of any of the other Banks or as a result of events other than the
sale by the Agent of any portion of its Commitment, the Agent shall have a
period of ninety (90) days after its failure to hold at least the Minimum
Commitment to cure such failure. Any such resignation or removal shall be
effective upon appointment and acceptance of a successor Agent, as hereinafter
provided. Upon any such resignation or removal, the Majority Banks shall have
the right to appoint a successor Agent, which is a Bank under this Agreement and
which holds at least the Minimum Commitment, PROVIDED that so long as no Default
or Event of Default has occurred and is continuing the Borrower shall have the
right to approve any successor Agent, which approval shall not be unreasonably
withheld. If, in the case of a resignation by the Agent, no successor Agent
shall have been so appointed by the Majority Banks and approved by the Borrower,
and shall have accepted such appointment, within thirty (30) days after the
retiring Agent's giving of notice of resignation, then the retiring Agent may,
on behalf of the Banks, appoint any one of the other Banks as a successor Agent.
The Borrower acknowledges that any Bank which acquires Fleet is acceptable as a
successor Agent. Upon the acceptance of any appointment as Agent hereunder by a
successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring or
removed Agent, and the retiring or removed Agent shall be discharged from all
further duties and obligations as Agent under this Agreement. After any Agent's
resignation or removal hereunder as Agent, the provisions of this Section 16
shall inure to its benefit as to any actions taken or omitted to be

                                      -100-


taken by it while it was Agent under this Agreement. The Agent agrees that it
shall not assign any of its rights or duties as Agent to any other Person.

    Section 16.12. NOTICES. Any notices or other information required hereunder
to be provided to the Agent (with copies to the Agent for each Bank) shall be
forwarded by the Agent to each of the Banks on the same day (if practicable)
and, in any case, on the next Business Day following the Agent's receipt thereof

    Section 17.    EXPENSES. The Borrower agrees to pay (a) the reasonable costs
of producing and reproducing this Agreement, the other Loan Documents and the
other agreements and instruments mentioned herein, (b) the reasonable fees,
expenses and disbursements of the Agent's outside counsel or any local counsel
to the Agent incurred in connection with the preparation, administration or
interpretation of the Loan Documents and other instruments mentioned herein,
each closing hereunder, and amendments, modifications, approvals, consents or
waivers hereto or hereunder, (c) the fees, expenses and disbursements of the
Agent incurred by the Agent in connection with the preparation, administration
or interpretation of the Loan Documents and other instruments mentioned herein,
including, without limitation, the costs incurred by the Agent in connection
with its inspection of the Borrowing Base Properties (subject to Section 12.14),
and, without double-counting amounts under clause (b) above, the fees and
disbursements of the Agent's counsel in preparing the documentation, (d) the
fees, costs, expenses and disbursements of the Agent and its Affiliates incurred
in connection with the initial syndication and/or participations of the Loans
(whether occurring before or after the closing hereunder), including, without
limitation, reasonable legal fees, travel costs, costs of preparing syndication
materials and photocopying costs, PROVIDED that the Borrower shall not incur any
costs or fees of any kind in connection with any participation, sale or other
syndication of any portion of the Loans which occurs after the initial
syndication other than reasonable legal fees and expenses incurred in connection
with any participation, sale or syndication undertaken at the request of the
Borrower or (in addition to any other fees or expenses relating thereto) in
connection with an amendment or increase to the amount of the Total Commitment,
(e) all reasonable expenses (including reasonable attorneys' fees and costs,
which attorneys may be employees of any Bank or the Agent, and the fees and
costs of engineers, investment bankers, or other experts retained by any Bank or
the Agent in connection with any such enforcement proceedings) incurred by any
Bank or the Agent in connection with (i) the enforcement of or preservation of
rights under any of the Loan Documents against the Borrower or any of its
Subsidiaries or BPI or the administration thereof after the occurrence and
during the continuance of a Default or Event of Default (including, without
limitation, expenses incurred in any restructuring and/or "workout" of the
Loans), and (ii) any litigation, proceeding or dispute whether arising hereunder
or otherwise, in any way related to any Bank's or the Agent's relationship with
the Borrower or any of its Subsidiaries or BPI, (f) all reasonable fees,
expenses and disbursements of the Agent incurred in connection with UCC
searches, UCC terminations or mortgage discharges, and (g) all costs incurred by
the Agent in the future in connection with its inspection of the Borrowing Base
Properties, PROVIDED that

                                      -101-


prior to the occurrence of an Event of Default, the Borrower shall not be
required to pay for more than one inspection of each Borrowing Base Property per
year. The covenants of this Section 17 shall survive the repayment of the
amounts owing under the Notes and this Agreement and the termination of this
Agreement and the obligations of the Banks hereunder.

    Section 18.    INDEMNIFICATION. The Borrower agrees to indemnify and hold
harmless the Agent and each of the Banks and the shareholders, directors,
agents, officers, subsidiaries and affiliates of the Agent and each of the Banks
from and against any and all claims, actions and suits, whether groundless or
otherwise, and from and against any and all liabilities, losses (including
amounts, if any, owing to any Bank pursuant to Section Section 5.4, 5.5, 5.6 and
5.8), settlement payments, obligations, damages and expenses of every nature and
character in connection therewith, arising out of this Agreement or any of the
other Loan Documents or the transactions contemplated hereby or thereby or which
otherwise arise in connection with the financing, including, without limitation,
(a) any actual or proposed use by the Borrower or any of its Subsidiaries of the
proceeds of any of the Loans, (b) the Borrower or any of its Subsidiaries
entering into or performing this Agreement or any of the other Loan Documents,
or (c) pursuant to Section 8.17, in each case including, without limitation, the
reasonable fees and disbursements of counsel and allocated costs of internal
counsel incurred in connection with any such investigation, litigation or other
proceeding, PROVIDED, HOWEVER, that the Borrower shall not be obligated under
this Section 18 to indemnify any Person for liabilities arising from such
Person's own gross negligence, willful misconduct or breach of this Agreement.
In litigation, or the preparation therefor, the Borrower shall be entitled to
select counsel reasonably acceptable to the Majority Banks, and the Agent (as
approved by the Majority Banks) shall be entitled to select their own
supervisory counsel, and, in addition to the foregoing indemnity, the Borrower
agrees to pay promptly the reasonable fees and expenses of each such counsel.
Prior to any settlement of any such litigation by the Banks, the Banks shall
provide the Borrower and BPI with notice and an opportunity to address any of
their concerns with the Banks, and the Banks shall not settle any litigation
without first obtaining Borrower's consent thereto, which consent shall not be
unreasonably withheld or delayed. If and to the extent that the obligations of
the Borrower under this Section 18 are unenforceable for any reason, the
Borrower hereby agrees to make the maximum contribution to the payment in
satisfaction of such obligations which is permissible under applicable law. The
provisions of this Section 18 shall survive the repayment of the amounts owing
under the Notes and this Agreement and the termination of this Agreement and the
obligations of the Banks hereunder and shall continue in full force and effect
as long as the possibility of any such claim, action, cause of action or suit
exists.

    Section 19.    SURVIVAL OF COVENANTS, ETC. All covenants, agreements,
representations and warranties made herein, in the Notes, in any of the other
Loan Documents or in any documents or other papers delivered by or on behalf of
the Borrower or any of its Subsidiaries or BPI pursuant hereto shall be deemed
to have been relied upon

                                      -102-


by the Banks and the Agent, notwithstanding any investigation heretofore or
hereafter made by any of them, and shall survive the making by the Banks of any
of the Loans and the issuance, extension or renewal of any Letters of Credit, as
herein contemplated, and shall continue in full force and effect so long as any
Letter of Credit or any amount due under this Agreement or the Notes or any of
the other Loan Documents remains outstanding or any Bank has any obligation to
make any Loans or the Agent or any Fronting Bank has any obligation to issue,
extend or renew any Letter of Credit. The indemnification obligations of the
Borrower provided herein and in the other Loan Documents shall survive the full
repayment of amounts due and the termination of the obligations of the Banks
hereunder and thereunder to the extent provided herein and therein. All
statements contained in any certificate or other paper delivered to any Bank or
the Agent at any time by or on behalf of the Borrower or any of its Subsidiaries
or BPI pursuant hereto or in connection with the transactions contemplated
hereby shall constitute representations and warranties by the Borrower or such
Subsidiary or BPI hereunder.

    Section 20.    ASSIGNMENT; PARTICIPATIONS; ETC.

    Section 20.1.  CONDITIONS TO ASSIGNMENT BY BANKS. Except as provided herein,
each Bank may assign to one or more Eligible Assignees all or a portion of its
interests, rights and obligations under this Agreement (including all or a
portion of its Commitment Percentage and Commitment and the same portion of the
Loans at the time owing to it, the Notes held by it and its participating
interest in the risk relating to any Letters of Credit); PROVIDED that (a) the
Agent and, other than during an Event of Default, the Borrower each shall have
the right to approve any Eligible Assignee, which approval shall not be
unreasonably withheld or delayed, it being agreed that the Agent and the
Borrower must approve or reject a proposed Eligible Assignee within seven (7)
days of receiving a written request from any Bank for such approval (PROVIDED
that the request for approval, and the envelope in which it is delivered, is
conspicuously marked with the following legend: "REQUEST FOR APPROVAL -- TIME
SENSITIVE -- MUST RESPOND WITHIN SEVEN (7) DAYS") and if the Agent or the
Borrower fails to respond within such seven (7) day period, such request for
approval shall be deemed approved by the Agent or the Borrower, or both, as the
case may be, (b) each such assignment shall be of a constant, and not a varying,
percentage of all the assigning Bank's rights and obligations under this
Agreement, (c) subject to the provisions of Section 2.7, each Bank shall have at
all times an amount of its Commitment of not less than $10,000,000 unless
otherwise consented to by the Agent and, other than during an Event of Default,
the Borrower and (d) the parties to such assignment shall execute and deliver to
the Agent, for recording in the Register (as hereinafter defined), an assignment
and assumption, substantially in the form of EXHIBIT F hereto (an "Assignment
and Assumption"), together with any Notes subject to such assignment. Upon such
execution, delivery, acceptance and recording, from and after the effective date
specified in each Assignment and Assumption, which effective date shall be at
least two (2) Business Days after the execution thereof unless otherwise agreed
by the Agent (PROVIDED

                                      -103-


any assignee has assumed the obligation to fund any outstanding Eurodollar Rate
Loans), (i) the assignee thereunder shall be a party hereto and, to the extent
provided in such Assignment and Assumption, have the rights and obligations of a
Bank hereunder and thereunder, and (ii) the assigning Bank shall, to the extent
provided in such assignment and upon payment to the Agent of the registration
fee referred to in Section 20.3, be released from its obligations under this
Agreement. Any such Assignment and Assumption shall run to the benefit of the
Borrower and a copy of any such Assignment and Assumption shall be delivered by
the Assignor to the Borrower.

    Notwithstanding the provisions of subclause (a) of the preceding paragraph,
any Bank may, without the consent of the Borrower, make an assignment otherwise
permitted hereunder to (x) another Bank, and (y) an Affiliate of such Bank,
PROVIDED that such Affiliate is an Eligible Assignee. Without limiting the
provisions of Section 17, with respect to an assignment by a Bank to its
Affiliate or to another Bank which does not require the consent of the Borrower,
unless such assignment occurs at the request of the Borrower, the Borrower shall
not be responsible for any costs or expenses attributable to such assignment,
all of which shall be payable by the assigning Bank.

    Section 20.2.  CERTAIN REPRESENTATIONS AND WARRANTIES; LIMITATIONS;
COVENANTS. By executing and delivering an Assignment and Assumption, the parties
to the assignment thereunder confirm to and agree with each other and the other
parties hereto as follows: (a) other than the representation and warranty that
it is the legal and beneficial owner of the interest being assigned thereby free
and clear of any adverse claim, the assigning Bank makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement or
the execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement, the other Loan Documents or any other instrument or
document furnished pursuant hereto; (b) the assigning Bank makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of the Borrower and its Subsidiaries or BPI or any other
Person primarily or secondarily liable in respect of any of the Obligations, or
the performance or observance by the Borrower and its Subsidiaries or BPI or any
other Person primarily or secondarily liable in respect of any of the
Obligations of any of their obligations under this Agreement or any of the other
Loan Documents or any other instrument or document furnished pursuant hereto or
thereto; (c) such assignee confirms that it has received a copy of this
Agreement, together with copies of the most recent financial statements referred
to in Section 7.4 and Section 8.4 and such other documents and information as it
has deemed appropriate to make its own credit analysis and decision to enter
into such Assignment and Assumption; (d) such assignee will, independently and
without reliance upon the assigning Bank, the Agent or any other Bank and based
on such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement; (e) such assignee represents and warrants that it is an Eligible
Assignee; (f) such assignee appoints and authorizes the Agent to take such
action as agent on its behalf and to exercise such powers under this Agreement
and the other Loan Documents as are

                                      -104-


delegated to the Agent by the terms hereof or thereof, together with such powers
as are reasonably incidental thereto; (g) such assignee agrees that it will
perform in accordance with their terms all of the obligations that by the terms
of this Agreement are required to be performed by it as a Bank; (h) such
assignee represents and warrants that it is legally authorized to enter into
such Assignment and Assumption; and (i) such assignee acknowledges that it has
made arrangements with the assigning Bank satisfactory to such assignee with
respect to its pro rata share of Letter of Credit Fees in respect of outstanding
Letters of Credit.

    Section 20.3.  REGISTER. The Agent shall maintain a copy of each Assignment
and Assumption delivered to it and a register or similar list (the "Register")
for the recordation of the names and addresses of the Banks and the Commitment
Percentages of, and principal amount of the Loans owing to, the Banks from time
to time. The entries in the Register shall be conclusive, in the absence of
manifest error, and the Borrower, the Agent and the Banks may treat each Person
whose name is recorded in the Register as a Bank hereunder for all purposes of
this Agreement. The Register shall be available for inspection by the Borrower
and the Banks at any reasonable time and from time to time upon reasonable prior
notice. Upon each such recordation, the assigning Bank agrees to pay to the
Agent a registration fee in the sum of $2,500.

    Section 20.4.  NEW NOTES. Upon its receipt of an Assignment and Assumption
executed by the parties to such assignment, together with each Note subject to
such assignment, the Agent shall (a) record the information contained therein in
the Register, and (b) give prompt notice thereof to the Borrower and the Banks
(other than the assigning Bank). Unless done simultaneously with the Assignment
and Assumption, within two (2) Business Days after receipt of such notice, the
Borrower, at its own expense, (i) shall execute and deliver to the Agent, in
exchange for each surrendered Revolving Credit Note, a new Revolving Credit Note
and Swingline Note or Bid Rate Note, if applicable, to the order of such
Eligible Assignee in an amount equal to the amount assumed by such Eligible
Assignee pursuant to such Assignment and Assumption and, if the assigning Bank
has retained some portion of its obligations hereunder, a new Revolving Credit
Note and other Note, if applicable, to the order of the assigning Bank in an
amount equal to the amount retained by it hereunder and (ii) shall deliver an
opinion from counsel to the Borrower in substantially the form delivered on the
Closing Date pursuant to Section 12.9 as to such new Notes. Such new Notes shall
provide that they are replacements for the surrendered Notes, shall be in an
aggregate principal amount equal to the aggregate principal amount of the
surrendered Notes, shall be dated the effective date of such Assignment and
Assumption and shall otherwise be in substantially the form of the assigned
Notes. The surrendered Notes shall be canceled and returned to the Borrower.

    Section 20.5.  PARTICIPATIONS. Each Bank may sell participations to one or
more banks or other entities in all or a portion of such Bank's rights and
obligations under this Agreement and the other Loan Documents; provided that (a)
each such participation shall be in an amount of not less than $10,000,000, (b)
any such sale or participation shall not

                                      -105-


affect the rights and duties of the selling Bank hereunder to the Borrower and
the Agent and the Bank shall continue to exercise all approvals, disapprovals
and other functions of a Bank, (c) the only rights granted to the participant
pursuant to such participation arrangements with respect to waivers, amendments
or modifications of, or approvals under, the Loan Documents shall be the rights
to approve waivers, amendments or modifications that would reduce the principal
of or the interest rate on any Loans, extend the term or increase the amount of
the Commitment of such Bank as it relates to such participant, reduce the amount
of any fees to which such participant is entitled or extend any regularly
scheduled payment date for principal or interest, and (d) no participant shall
have the right to grant further participations or assign its rights, obligations
or interests under such participation to other Persons without the prior written
consent of the Agent, which consent shall not be unreasonably withheld.

    Section 20.6.  PLEDGE BY LENDER. Notwithstanding any other provision of this
Agreement, any Bank at no cost to the Borrower may at any time pledge all or any
portion of its interest and rights under this Agreement (including all or any
portion of its Notes) to any of the twelve Federal Reserve Banks organized under
Section 4 of the Federal Reserve Act, 12 U.S.C. Section 341. No such pledge or
the enforcement thereof shall release the pledgor Bank from its obligations
hereunder or under any of the other Loan Documents.

    Section 20.7.  NO ASSIGNMENT BY BORROWER. The Borrower shall not assign or
transfer any of its rights or obligations under any of the Loan Documents
without prior Unanimous Bank Approval.

    Section 20.8.  DISCLOSURE. The Borrower agrees that, in addition to
disclosures made in accordance with standard banking practices, any Bank may
disclose information obtained by such Bank pursuant to this Agreement to
assignees or participants and potential assignees or participants hereunder. Any
such disclosed information shall be treated by any assignee or participant with
the same standard of confidentiality set forth in Section 8.10.

    Section 20.9.  SYNDICATION. The Borrower acknowledges that each of the Agent
and the Arranger intends, and shall have the right, by itself or through its
Affiliates, to syndicate or enter into co-lending arrangements with respect to
the Loans and the Total Commitment pursuant to this Section 20, and the Borrower
agrees to cooperate with the Agent's and the Arranger's and their Affiliate's
syndication and/or co-lending efforts, such cooperation to include, without
limitation, the provision of information reasonably requested by potential
syndicate members.

    Section 21.    NOTICES, ETC. Except as otherwise expressly provided in this
Agreement, all notices and other communications made or required to be given
pursuant to this Agreement or the Notes or any Letter of Credit Applications
shall be in writing and shall be delivered in hand, mailed by United States
registered or certified first class mail, postage prepaid, sent by overnight
courier, or sent by facsimile and confirmed by delivery via courier or postal
service, addressed as follows:

                                      -106-


                   (a) if to the Borrower or BPI, at Boston Properties, Inc.,
111 Huntington Avenue, Boston, Massachusetts 02199, Attention: Mr. Douglas T.
Linde, Senior Vice President and Chief Financial Officer, with a copy to the
General Counsel of BPLP at the address for the Borrower set forth above and to
Ross D. Gillman, Esq., Goodwin Procter LLP, 599 Lexington Avenue, New York, New
York 10022, or to such other address for notice as the Borrower or BPI shall
have last furnished in writing to the Agent;

                   (b) if to the Agent, to the Real Estate Finance Department at
100 Federal Street, Boston, Massachusetts 02110, with a copy to Robert C. Avil,
Director, Fleet National Bank, 115 Perimeter Center Place, Suite 500, Atlanta,
Georgia 30346, or such other address for notice as the Agent shall have last
furnished in writing to the Borrower, with a copy to Michael J. Haroz, Esq.,
Goulston & Storrs, 400 Atlantic Avenue, Boston, Massachusetts 02110-3333, or at
such other address for notice as the Agent shall last have furnished in writing
to the Person giving the notice; and

                   (c) if to any Bank, at such Bank's address set forth ON
SCHEDULE 2 hereto, or such other address for notice as such Bank shall have last
furnished in writing to the Person giving the notice.

Any such notice or demand shall be deemed to have been duly given or made and to
have become effective (i) if delivered by hand, overnight courier, or facsimile
to the party to which it is directed, at the time of the receipt thereof by such
party or the sending of such facsimile and (ii) if sent by registered or
certified first-class mail, postage prepaid, on the third Business Day following
the mailing thereof.

    Section 22.    BPLP AS AGENT FOR THE BORROWER. The Borrower (other than
BPLP) hereby appoints BPLP as its agent with respect to the receiving and giving
of any notices, requests, instructions, reports, certificates (including,
without limitation, compliance certificates), schedules, revisions, financial
statements or any other written or oral communications hereunder. The Agent and
each Bank is hereby entitled to rely on any communications given or transmitted
by BPLP as if such communication were given or transmitted by each and every
Borrower; PROVIDED HOWEVER, that any communication given or transmitted by any
Borrower other than BPLP shall be binding with respect to such Borrower. Any
communication given or transmitted by the Agent or any Bank to BPLP shall be
deemed given and transmitted to each and every Borrower.

    Section 23.    GOVERNING LAW; CONSENT TO JURISDICTION AND SERVICE. THIS
AGREEMENT AND EACH OF THE OTHER LOAN DOCUMENTS, EXCEPT AS OTHERWISE SPECIFICALLY
PROVIDED THEREIN, ARE CONTRACTS UNDER THE LAWS OF THE COMMONWEALTH OF
MASSACHUSETTS AND SHALL FOR ALL PURPOSES BE CONSTRUED IN ACCORDANCE WITH AND
GOVERNED BY THE LAWS OF SUCH COMMONWEALTH (EXCLUDING THE

                                      -107-


LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW). EACH OF THE BORROWER AND ITS
SUBSIDIARIES AGREES THAT ANY SUIT FOR THE ENFORCEMENT OF THIS AGREEMENT OR ANY
OF THE OTHER LOAN DOCUMENTS MAY BE BROUGHT IN THE COURTS OF THE COMMONWEALTH OF
MASSACHUSETTS SITTING IN SUFFOLK COUNTY OR ANY FEDERAL COURT SITTING IN THE
EASTERN DISTRICT OF MASSACHUSETTS AND CONSENTS TO THE NON-EXCLUSIVE JURISDICTION
OF SUCH COURTS AND THE SERVICE OF PROCESS IN ANY SUCH SUIT BEING MADE UPON THE
BORROWER OR ITS SUBSIDIARIES BY MAIL AT THE ADDRESS SPECIFIED IN Section 21. THE
BORROWER AND ITS SUBSIDIARIES HEREBY WAIVE ANY OBJECTION THAT ANY OF THEM MAY
NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH SUIT OR ANY SUCH COURT OR THAT
SUCH SUIT IS BROUGHT IN AN INCONVENIENT COURT.

    Section 24.    HEADINGS. The captions in this Agreement are for convenience
of reference only and shall not define or limit the provisions hereof.

    Section 25.    COUNTERPARTS. This Agreement and any amendment hereof may be
executed in several counterparts and by each party on a separate counterpart,
each of which when so executed and delivered shall be an original, and all of
which together shall constitute one instrument. In proving this Agreement it
shall not be necessary to produce or account for more than one such counterpart
signed by the party against whom enforcement is sought.

    Section 26.    ENTIRE AGREEMENT, ETC. The Loan Documents and any other
documents executed in connection herewith or therewith express the entire
understanding of the parties with respect to the transactions contemplated
hereby. Neither this Agreement nor any term hereof may be changed, waived,
discharged or terminated, except as provided in Section 27.

    Section 27.    WAIVER OF JURY TRIAL AND CERTAIN DAMAGE CLAIMS. EXCEPT TO THE
EXTENT EXPRESSLY PROHIBITED BY LAW, THE BORROWER AND ITS SUBSIDIARIES HEREBY
WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL WITH RESPECT TO ANY ACTION OR
CLAIM ARISING OUT OF ANY DISPUTE IN CONNECTION WITH THIS AGREEMENT, THE NOTES OR
ANY OF THE OTHER LOAN DOCUMENTS, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR
THEREUNDER OR THE PERFORMANCE OF SUCH RIGHTS AND OBLIGATIONS. EXCEPT TO THE
EXTENT EXPRESSLY PROHIBITED BY LAW, THE BORROWER AND ITS SUBSIDIARIES HEREBY
WAIVE ANY RIGHT ANY OF THEM MAY HAVE TO CLAIM OR RECOVER IN ANY LITIGATION
REFERRED TO IN THE PRECEDING SENTENCE ANY SPECIAL, EXEMPLARY, PUNITIVE OR
CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL
DAMAGES, INCLUDING ANY DAMAGES PURSUANT TO M.G.L. C. 93A ET SEQ. EACH OF

                                      -108-


THE BORROWER AND ITS SUBSIDIARIES (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY BANK OR THE AGENT HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT
SUCH BANK OR THE AGENT WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE
THE FOREGOING WAIVERS AND (B) ACKNOWLEDGES THAT THE AGENT AND THE BANKS HAVE
BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS TO WHICH
THEY ARE PARTIES BY, AMONG OTHER THINGS, THE WAIVERS AND CERTIFICATIONS
CONTAINED HEREIN.

    Section 28.    CONSENTS, AMENDMENTS, WAIVERS, ETC. Except as otherwise
expressly provided in this Agreement, any consent or approval required or
permitted by this Agreement may be given, and any term of this Agreement or of
any of the other Loan Documents may be amended, and the performance or
observance by the Borrower or BPI or any of their respective Subsidiaries of any
terms of this Agreement or the other Loan Documents or the continuance of any
Default or Event of Default may be waived (either generally or in a particular
instance and either retroactively or prospectively) with, but only with, the
written consent of the Majority Banks.

    Notwithstanding the foregoing, Unanimous Bank Approval shall be required for
any amendment, modification or waiver of this Agreement that:

                            (i)   reduces or forgives any principal of any
                       unpaid Loan or any interest thereon (including any
                       interest "breakage" costs) or any fees due any Bank
                       hereunder, or permits any prepayment not otherwise
                       permitted hereunder; or

                            (ii)  changes the unpaid principal amount of any
                       Loan, reduces the rate of interest applicable to any
                       Loan, or reduces any fee payable to the Banks hereunder;
                       or

                            (iii) changes the date fixed for any payment of
                       principal of or interest on any Loan (including, without
                       limitation, any extension of the Maturity Date) or any
                       fees payable hereunder (including, without limitation,
                       the waiver of any monetary Event of Default); or

                            (iv)  changes the amount of any Bank's Commitment
                       (other than pursuant to an assignment permitted under
                       Section 20.1) or increases the amount of the Total
                       Commitment except as permitted hereunder; or

                            (v)   modifies any provision herein or in any other
                       Loan Document which by the terms thereof expressly
                       requires Unanimous Bank Approval; or

                                      -109-


                            (vi)  changes the definitions of Majority Banks,
                       Required Banks or Unanimous Bank Approval.

    No waiver shall extend to or affect any obligation not expressly waived or
impair any right consequent thereon. No course of dealing or delay or omission
on the part of the Agent or the Banks or any Bank in exercising any right shall
operate as a waiver thereof or otherwise be prejudicial to such right or any
other rights of the Agent or the Banks. No notice to or demand upon the Borrower
shall entitle the Borrower to other or further notice or demand in similar or
other circumstances.

    Notwithstanding the foregoing, the Required Banks shall be required for any
amendment, modification or waiver of this agreement that:

                            (i)   amends any of the covenants contained in
                       Section 10.1 through Section 10.7, inclusive or amends
                       any of the definitions which are financial terms
                       contained therein, or

                            (ii)  amends any of the provisions governing funding
                       contained in Section 2, or

                            (iii) changes the rights, duties or obligations of
                       the Agent specified in Section 16 (PROVIDED that no
                       amendment or modification to such Section 16 or to the
                       fee payable to the Agent under this Agreement may be made
                       without the prior written consent of the Agent and that
                       the waiver of any fee payable to the Agent shall require
                       only the consent of the Agent).

    In addition, no amendment or modification to or waiver of the provisions of
Section 2.8 may be made without the prior written consent of the Swingline
Lender and, without limitation of the provisions requiring Unanimous Bank
Approval or the consent of the Required Banks, no amendment or modification to
or waiver of the provisions of Section 2.9 may be made without the prior written
consent of those Banks holding more than 50% of the outstanding Bid Rate Loans
at the applicable time of reference.

    Section 29.    SEVERABILITY. The provisions of this Agreement are severable,
and if any one clause or provision hereof shall be held invalid or unenforceable
in whole or in part in any jurisdiction, then such invalidity or
unenforceability shall affect only such clause or provision, or part thereof, in
such jurisdiction, and shall not in any manner affect such clause or provision
in any other jurisdiction, or any other clause or provision of this Agreement in
any jurisdiction.

                                      -110-


    Section 30.    INTEREST RATE LIMITATION. Notwithstanding anything herein to
the contrary, if at any time the interest rate applicable to any Loan, together
with all fees, charges and other amounts which are treated as interest on such
Loan under applicable law (collectively, the "Charges"), shall exceed the
maximum lawful rate (the "Maximum Rate") which may be contracted for, charged,
taken, received or reserved by the Bank holding such Loan in accordance with
applicable law, the rate of interest payable in respect of such Loan hereunder,
together with all Charges payable in respect thereof, shall be limited to the
Maximum Rate and, to the extent lawful, the interest and Charges that would have
been payable in respect of such Loan but were not payable as a result of the
operation of this Section 30 shall be cumulated and the interest and Charges
payable to such Bank in respect of other Loans or periods shall be increased
(but not above the Maximum Rate therefor) until such cumulated amount, together
with interest thereon at the Federal Funds Rate to the date of repayment, shall
have been received by such Bank.

                  (Remainder of page intentionally left blank)

                                      -111-


    IN WITNESS WHEREOF, the undersigned have duly executed this Agreement as a
sealed instrument as of the date first set forth above.

                                 FLEET NATIONAL BANK,
                                 Individually and as Managing Administrative
                                 Agent


                                 By: /s/ Jeff Z. Aycock
                                    ------------------------------------------
                                 Name: Jeff Z. Aycock
                                 Title: Vice President


                                 BANK OF AMERICA, N.A.,
                                 Individually and as Syndication Agent


                                 By: /s/ Lesa J. Butler
                                    ------------------------------------------
                                 Name: Lesa J. Butler
                                 Title: Principal


                                 COMMERZBANK AG NEW YORK AND
                                 GRAND CAYMAN BRANCHES,
                                 Individually and as Co-Documentation Agent

                                 By: /s/ Christian Berry
                                    ------------------------------------------
                                 Name: Christian Berry
                                 Title: Vice President

                                 By: /s/ Douglas Traynor
                                    ------------------------------------------
                                 Name: Douglas Traynor
                                 Title: Senior Vice President


                       [Signatures continued on next page]

                                      -112-


                                 JPMORGAN CHASE BANK,
                                 Individually and as Co-Documentation Agent

                                 By: /s/ Marc E. Costantino
                                    ------------------------------------------
                                 Name: Marc E. Costantino
                                 Title: Vice President


                                 WELLS FARGO BANK NATIONAL
                                 ASSOCIATION,
                                 Individually and as Co-Documentation Agent


                                 By: /s/ Douglas S. Novitch
                                    ------------------------------------------
                                 Name: Douglas S. Novitch
                                 Title: Authorized Officer


                                 PNC BANK, NATIONAL ASSOCIATION


                                 By: /s/ James Colella
                                    ------------------------------------------
                                 Name: James Colella
                                 Title: Vice President


                                 THE BANK OF NEW YORK

                                 By: /s/ Rick Laudisi
                                    ------------------------------------------
                                 Name: Rick Laudisi
                                 Title: Vice President


                       [Signatures continued on next page]

                                      -113-


                                 CITICORP NORTH AMERICA, INC.


                                 By: /s/ Andrew Robinson
                                    ------------------------------------------
                                 Name: Andrew Robinson
                                 Title: Vice President


                                 BAYERISCHE HYPO-UND VEREINSBANK
                                 AG, NEW YORK BRANCH


                                 By: /s/ Helga Blum
                                    ------------------------------------------
                                 Name: Helga Blum
                                 Title: Director


                                 DEUTSCHE BANK TRUST COMPANY AMERICAS


                                 By: /s/ Linda Wang
                                    ------------------------------------------
                                 Name: Linda Wang
                                 Title: Vice President


                                 KEYBANK, N.A.


                                 By: /s/ John C. Scott
                                    ------------------------------------------
                                 Name: John C. Scott
                                 Title: Assistant Vice President


                       [Signatures continued on next page]

                                      -114-


                                 DRESDNER BANK AG, NEW YORK AND
                                 GRAND CAYMAN BRANCHES


                                 By: /s/ Peter Tzelios
                                    ------------------------------------------
                                 Name: Peter Tzelios
                                 Title: Director


                                 By: /s/ David Sarner
                                    ------------------------------------------
                                 Name: David Sarner
                                 Title: Associate


                                 CITIZENS BANK

                                 By: /s/ Daniel Ouellette
                                    ------------------------------------------
                                 Name: Daniel Ouellette
                                 Title: Senior Vice President

                                      -115-


                                 332 HARTWELL AVENUE, LEXINGTON, MA**

                                 MBZ-LEX TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 WALTHAM OFFICE CENTER, WALTHAM, MA

                                 ZEE EM TRUST II

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

- ----------
** The designation of the specific Real Estate Asset or Assets owned by any
signatory to this Agreement or any other Loan Document is for informational
purposes only and does not in any way limit the joint and several liability of
each Borrower, for so long as it is a Borrower, for the Obligations.

                                      -116-


                                 204 SECOND AVENUE, WALTHAM, MA

                                 WP TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 170 TRACER LANE, WALTHAM, MA

                                 TRACER LANE TRUST II

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                      -117-


                                 33 HAYDEN AVENUE, LEXINGTON, MA

                                 HAYDEN OFFICE TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 92 AND 100 HAYDEN AVENUE, LEXINGTON, MA

                                 92 HAYDEN AVENUE TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                      -118-


                                 LEXINGTON OFFICE PARK, 420-430 BEDFORD STREET,
                                 LEXINGTON, MA

                                 ELANDZEE TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 40-46 HARVARD STREET, WESTWOOD, MA

                                 40-46 HARVARD STREET TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                      -119-


                                 17 HARTWELL AVENUE, LEXINGTON, MA

                                 ZEE BEE TRUST II

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 ONE CAMBRIDGE CENTER, CAMBRIDGE, MA

                                 ONE CAMBRIDGE CENTER TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                      -120-


                                 THREE CAMBRIDGE CENTER, CAMBRIDGE, MA

                                 THREE CAMBRIDGE CENTER TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 ELEVEN CAMBRIDGE CENTER, CAMBRIDGE, MA

                                 ELEVEN CAMBRIDGE CENTER TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                      -121-


                                 FOURTEEN CAMBRIDGE CENTER, CAMBRIDGE, MA

                                 FOURTEEN CAMBRIDGE CENTER TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 500 E STREET, S.W., WASHINGTON, D.C.

                                 SCHOOL STREET ASSOCIATES LIMITED PARTNERSHIP

                                 By:  Boston Properties LLC, its sole general
                                      partner

                                      By:  Boston Properties Limited
                                           Partnership, its managing member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   -------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer

                                      -122-


                                 LONG WHARF MARRIOTT, BOSTON, MA

                                 DOWNTOWN BOSTON PROPERTIES TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                 CAMBRIDGE CENTER MARRIOTT, CAMBRIDGE, MA

                                 TWO CAMBRIDGE CENTER TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                      -123-


                                 DECOVERLY TWO, ROCKVILLE, MD

                                 DECOVERLY TWO LIMITED PARTNERSHIP

                                 By:  Boston Properties LLC, its general partner

                                      By:  Boston Properties Limited
                                           Partnership, its Managing Member

                                           By:  Boston Properties, Inc.,
                                                its general partner

                                                By: /s/ Douglas T. Linde
                                                   -------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer


                                 THE CANDLER BUILDING, 111 MARKET PLACE,
                                 BALTIMORE, MD

                                 CANDLER ASSOCIATES L.L.C.

                                 By:  Boston Properties Limited Partnership,
                                      its managing member

                                      By:  Boston Properties, Inc.,
                                           its general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                      -124-


                                 104 CARNEGIE CENTER, PRINCETON, NJ

                                 CARNEGIE CENTER ASSOCIATES

                                 By:  Boston Properties Limited Partnership, its
                                      general partner

                                      By:  Boston Properties, Inc., its general
                                           partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 105 CARNEGIE CENTER, PRINCETON, NJ

                                 CARNEGIE CENTER ASSOCIATES

                                 By:  Boston Properties Limited Partnership, its
                                      general partner

                                      By:  Boston Properties, Inc., its general
                                           partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                      -125-


                                 210 CARNEGIE CENTER, PRINCETON, NJ

                                 210 ASSOCIATES LIMITED PARTNERSHIP

                                 By:  Boston Properties LLC, its general partner

                                      By:  Boston Properties Limited
                                           Partnership, its managing member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   -------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer

                                 211 CARNEGIE CENTER, PRINCETON, NJ

                                 211 ASSOCIATES LIMITED PARTNERSHIP

                                 By:  Boston Properties LLC, its general partner

                                      By:  Boston Properties Limited
                                           Partnership, its managing member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   -------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer

                                      -126-


                                 CAMBRIDGE CENTER NORTH GARAGE, CAMBRIDGE, MA

                                 CAMBRIDGE CENTER NORTH TRUST

                                 By:  Boston Properties Limited Partnership, its
                                      beneficiary

                                      By:  Boston Properties, Inc., its general
                                           partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 9509 KEY WEST AVENUE, DECOVERLY SEVEN,
                                 ROCKVILLE, MD

                                 DECOVERLY SEVEN LIMITED PARTNERSHIP

                                 By:  Boston Properties LLC, its general partner

                                      By:  Boston Properties Limited
                                           Partnership, its managing member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   -------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer

                                      -127-


                                 ONE TOWER CENTER, EAST BRUNSWICK, NJ

                                 SCV PARTNERS

                                 By:  BP III LLC, its general partner

                                      By:  Boston Properties Limited
                                           Partnership, its managing member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   -------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer


                                 201 CARNEGIE CENTER, PRINCETON, NJ

                                 PRINCETON CHILDCARE ASSOCIATES
                                 LIMITED PARTNERSHIP

                                 By:  Boston Properties LLC, its sole general
                                      partner

                                      By:  Boston Properties Limited
                                           Partnership, its managing member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   -------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer

                                      -128-


                                 399 PARK AVENUE, NEW YORK, NY

                                 195 WEST STREET, WALTHAM, MA

                                 7435 BOSTON BOULEVARD, BUILDING ONE,
                                 SPRINGFIELD, VA

                                 7451 BOSTON BOULEVARD, BUILDING TWO,
                                 SPRINGFIELD, VA

                                 7374 BOSTON BOULEVARD, BUILDING FOUR,
                                 SPRINGFIELD, VA

                                 8000 GRAINGER COURT, BUILDING FIVE,
                                 SPRINGFIELD, VA

                                 7500 BOULEVARD, BUILDING SIX,
                                 SPRINGFIELD, VA

                                 7501 BOSTON BOULEVARD, BUILDING SEVEN,
                                 SPRINGFIELD, VA

                                 7601 BOSTON BOULEVARD, BUILDING EIGHT,
                                 SPRINGFIELD, VA

                                 7375 BOSTON BOULEVARD, BUILDING TEN,
                                 SPRINGFIELD, VA

                                 7300 BOSTON BOULEVARD, BUILDING THIRTEEN,
                                 SPRINGFIELD, VA

                                 8000 CORPORATE COURT, BUILDING ELEVEN,
                                 SPRINGFIELD, VA

                                 38 CABOT BOULEVARD, BUCKS COUNTY, PA

                                 365 HERNDON PARKWAY (SUGARLAND I),
                                 HERNDON, VA

                                 397 HERNDON PARKWAY (SUGARLAND II),
                                 HERNDON, VA

                                      -129-


                                 164 LEXINGTON ROAD, BILLERICA, MA

                                 THE ARBORETUM, 12700 SUNRISE VALLEY DRIVE,
                                 RESTON, VA

                                 502 CARNEGIE CENTER, PRINCETON, NJ

                                 RESIDENCE INN, CAMBRIDGE, MA

                                 212 CARNEGIE CENTER, PRINCETON, NJ

                                 NEWPORT OFFICE CENTER, QUINCY, MA

                                 ORBITAL SCIENCES - PHASE I, DULLES, VA

                                 DECOVERLY THREE, 15204 OMEGA DRIVE, ROCKVILLE,
                                 MD

                                 7450 BOSTON BOULEVARD, BUILDING THREE,
                                 SPRINGFIELD, VA

                                 200 WEST STREET, WALTHAM, MA

                                 Broad Run Business Park Building E,
                                 MORAN ROAD, LEESBURG VA

                                 BOSTON PROPERTIES LIMITED PARTNERSHIP


                                 By:  Boston Properties, Inc., its sole general
                                      partner

                                      By: /s/ Douglas T. Linde
                                         -------------------(SEAL)
                                         Douglas T. Linde
                                         Senior Vice President and
                                         Chief Financial Officer

                       [Signatures continued on next page]

                                      -130-


ACKNOWLEDGED AND AGREED:

BOSTON PROPERTIES, INC.


By: /s/ Douglas T. Linde
   -------------------(SEAL)
   Douglas T. Linde
   Senior Vice President and
   Chief Financial Officer

                                      -131-


                                   SCHEDULE 1

                                  MBZ-LEX Trust
                                 ZEE EM Trust II
                                    WP Trust
                              Tracer Lane Trust II
                               Hayden Office Trust
                             92 Hayden Avenue Trust
                                 Elandzee Trust
                           40-46 Harvard Street Trust
                                ZEE BEE Trust II
                           One Cambridge Center Trust
                          Three Cambridge Center Trust
                          Eleven Cambridge Center Trust
                         Fourteen Cambridge Center Trust
                  School Street Associates Limited Partnership
                        Downtown Boston Properties Trust
                           Two Cambridge Center Trust
                        Decoverly Two Limited Partnership
                            Candler Associates L.L.C.
                           Carnegie Center Associates
                       210 Associates Limited Partnership
                       211 Associates Limited Partnership
                          Cambridge Center North Trust
                       Decoverly Seven Limited Partnership
                                  SCV Partners
               Princeton Childcare Associates Limited Partnership

                                      S1-1


                                   SCHEDULE 2



Bank                                            Commitment Amount            Commitment Percentage
- ----                                            -----------------            ---------------------
                                                                               
Fleet National Bank                                $  68,500,000                     11.32%
One Federal Street
Boston, MA 02109

Bank of America, N.A.                              $  68,500,000                     11.32%
TX1-492-64-01
901 Main Street
64th Floor
Dallas, TX  75202-3714

Commerzbank AG New York and                        $  56,000,000                      9.26%
Grand Cayman Branches
2 World Financial Center
New York, NY  10281-1050

JPMorgan Chase Bank                                $  56,000,000                      9.26%
270 Park Avenue
New York, NY  10017

Wells Fargo Bank National Association              $  56,000,000                      9.26%
121 High Street, 5th Floor
Boston, MA  02110

PNC Bank, National Association                     $  40,000,000                      6.61%
One PNC Plaza
249 Fifth Avenue
Mail Stop P1-P0PP-19-2
Pittsburgh, PA  15222

The Bank of New York                               $  40,000,000                      6.61%
One Wall Street
New York, NY  10286

Bayerische Hypo- Und Vereinsbank                   $  40,000,000                      6.61%
  AG, New York Branch
150 East 42nd Street
New York, NY  10017-4679


                                      S2-1



                                                                                
Dresdner Bank AG, New York and Grand Cayman        $  40,000,000                      6.61%
  Branches
75 Wall Street
New York, NY  10005

Citicorp North America, Inc.                       $  40,000,000                      6.61%
399 Park Avenue, 16th Floor
New York, NY  10043

KeyBank, N.A.                                      $  40,000,000                      6.61%
127 Public Square
Cleveland, OH  44114

Deutsche Bank Trust Company Americas               $  35,000,000                      5.79%
c/o Deutsche Bank Securities, Inc.
200 Crescent Court
Suite 550
Dallas, TX  75201

Citizens Bank                                      $  25,000,000                      4.13%
28 State Street
Boston, MA  02109

TOTAL                                              $ 605,000,000                       100%


                                      S2-2


                                   SCHEDULE 3
                            BORROWING BASE PROPERTIES

32 Hartwell Avenue, Lexington, MA

Waltham Office Center, Waltham, MA

204 Second Avenue, Waltham, MA

170 Tracer Lane, Waltham, MA

33 Hayden Avenue, Lexington, MA

92 & 100 Hayden Avenue, Lexington, MA

Lexington Office Park, 420-430 Bedford Street, Lexington, MA

40-46 Harvard Street, Westwood, MA

17 Hartwell Avenue, Lexington, MA

One Cambridge Center, Cambridge, MA

Three Cambridge Center, Cambridge, MA

Eleven Cambridge Center, Cambridge, MA

Fourteen Cambridge Center, Cambridge, MA

500 E Street, S.W., Washington, D.C.

Long Wharf Marriott, Boston, MA

Cambridge Center Marriott, Cambridge, MA

Decoverly Two, Rockville, MD

Decoverly Seven, 9509 Key West Avenue, Rockville, MD

The Candler Building, 111 Market Place, Baltimore, MD

One Tower Center, East Brunswick, NJ

104 Carnegie Center, Princeton, NJ

105 Carnegie Center, Princeton, NJ

210 Carnegie Center, Princeton, NJ

211 Carnegie Center, Princeton, NJ

212 Carnegie Center, Princeton, NJ

                                      S3-1


Cambridge Center North Garage, Cambridge, MA

195 West Street, Waltham, MA

7435 Boston Boulevard, Building One, Springfield, VA

7451 Boston Boulevard, Building Two, Springfield, VA

7374 Boston Boulevard, Building Four, Springfield, VA

8000 Grainger Court, Building Five, Springfield, VA

7500 Boston Boulevard, Building Six, Springfield, VA

7501 Boston Boulevard, Building Seven, Springfield, VA

7601 Boston Boulevard, Building Eight, Springfield, VA

7375 Boston Boulevard, Building Ten, Springfield, VA

8000 Corporate Court, Building Eleven, Springfield, VA

7300 Boston Boulevard, Building Thirteen, Springfield, VA

38 Cabot Boulevard, Bucks County, PA

365 Herndon Parkway (Sugarland I), Herndon, VA

397 Herndon Parkway (Sugarland II), Herndon, VA

164 Lexington Road, Billerica, MA

The Arboretum, 12700 Sunrise Valley Drive, Reston, VA

502 Carnegie Center, Princeton, NJ

Residence Inn, Cambridge, MA

Decoverly Three, 15204 Omega Drive, Rockville, MD

7450 Boston Boulevard, Building Three, Springfield, VA

200 West Street, Waltham, MA

Newport Office Park, Quincy, MA

Orbital Sciences-Phase I, Dulles, VA

399 Park Avenue, New York, NY

201 Carnegie Center, Princeton, NJ

Broad Run Business Park Building E, Moran Road, Leesburg, VA

                                      S3-2


                                   SCHEDULE 4

                                 CBD PROPERTIES

1 Cambridge Center

3 Cambridge Center

8 Cambridge Center

10 Cambridge Center

11 Cambridge Center

14 Cambridge Center

Cambridge Center North Garage

Long Wharf Marriott Hotel

One Embarcadero Center

Two Embarcadero Center

Three Embarcadero Center

Four Embarcadero Center

Federal Reserve Building

Embarcadero Center West Tower

599 Lexington Avenue

Metropolitan Square

901 New York Avenue

1301 New York Avenue

Capital Gallery

280 Park Avenue

Prudential Tower

Antenna Income @ Pru Tower

101 Huntington Avenue

The Shops at the Prudential Center

                                      S4-1


Lord & Taylors @ Prudential Center

Saks @ Prudential Center

Shaw's Supermarket @ Prudential Center (currently under development)

Prudential Center Garage

500 E Street

Sumner Square

875 Third Avenue

2300 N Street

111 Huntington Avenue

Times Square Tower (Site 1)

5 Times Square

University Place

399 Park Avenue

Citigroup Center

265 Franklin Street

Market Square North

                                      S4-2


                                 SCHEDULE 7.1(b)

                            PREFERRED CREDITOR EQUITY

                                      None.

                                    S7.1(b)-1


                                  SCHEDULE 7.7

                                   LITIGATION

                                      None.

                                     S7.7-1


                                  SCHEDULE 7.16

                             EMPLOYEE BENEFIT PLANS

Boston Properties maintains a supplemental retirement plan for a very limited
number of specified non-senior executive officer employees. In addition, Boston
Properties is obligated to make contributions or other payments to retirement
plans on behalf of certain employees located in New York City pursuant to
collective bargaining agreements to which Boston Properties is bound. These
obligations are not, individually or in the aggregate, material to BPI, BPLP or,
taken as a whole, the BP Group.

                                     S7.16-1


                                  SCHEDULE 7.19

                                  SUBSIDIARIES

                               See attached chart

                                     S7.19-1


                                 SCHEDULE 8.5(b)

                              ENVIRONMENTAL MATTERS

          Those matters identified in the Form 10-K filed with BPI with the SEC
for fiscal year 2001 on pages 13-14 therein.

                                    S8.5(b)-1


                                 SCHEDULE 9.1(e)

                                 BPI LIABILITIES

Liabilities relating to organizational matters (including liabilities of BPI as
the general partner of the Borrower and as a partner or member of subsidiaries
of the Borrower).

Liabilities relating to 100 East Pratt Street, Baltimore, Maryland.

Liabilities arising in connection with service contracts, management contracts,
employment and employee-benefit related agreements, letters of intent, brokerage
agreements, confidentiality agreements, development agreements and similar types
of agreements.

Liabilities arising in connection with litigation or other similar actions
arising in the ordinary course of business.

Liabilities of the same or similar kind or nature as those liabilities described
above which are not, individually or in the aggregate, material to BPI, BPLP or,
taken as a whole, the BP Group

                                    S9.1(e)-1


                                  SCHEDULE 9.3

                                   INVESTMENTS

                 See attached chart (identical to Schedule 7.19)

                                     S9.3-1


                                                                       EXHIBIT A

                             [AMENDED AND RESTATED]

                              REVOLVING CREDIT NOTE

$_______________                                         Date: ______________

    FOR VALUE RECEIVED, the undersigned Boston Properties Limited Partnership, a
Delaware limited partnership, and each of the other undersigned parties and
other parties who are or from time to time become a Borrower under (and as
defined in) the Revolving Credit Agreement referred to below ______________
(hereinafter, together with their respective successors in title and assigns,
collectively called the "Borrower"), by this promissory note (hereinafter,
called "this Note"), absolutely and unconditionally and jointly and severally
promise to pay to the order of (hereinafter, together with its successors in
title and assigns, called the "Bank"), the principal sum of
_______________________________ Million and 00/100 Dollars ($___________), or
so much thereof as shall have been advanced by the Bank to the Borrower by way
of Revolving Credit Loans under (and as defined in) the Revolving Credit
Agreement and shall remain outstanding, such payment to be made as hereinafter
provided, and to pay interest on the principal sum outstanding hereunder from
time to time from and after the date hereof until the said principal sum or the
unpaid portion thereof shall have become due and payable as hereinafter
provided.

    Capitalized terms used herein without definition shall have the meanings set
forth in the Revolving Credit Agreement.

    The unpaid principal (not at the time overdue) under this Note shall bear
interest at the rate or rates from time to time in effect under the Revolving
Credit Agreement. Accrued interest on the unpaid principal under this Note shall
be payable on the dates specified in the Revolving Credit Agreement.

    On the Maturity Date there shall become absolutely due and payable by the
Borrower hereunder, and the Borrower hereby promises to pay to the Bank, the
balance (if any) of the principal hereof then remaining unpaid, all of the
unpaid interest accrued hereon and all (if any) other amounts payable on or in
respect of this Note or the indebtedness evidenced hereby.

    Each overdue amount (whether of principal, interest or otherwise) payable on
or in respect of this Note or the indebtedness evidenced hereby shall (to the
extent permitted by applicable law) bear interest at the rates and on the terms
provided in the Revolving Credit Agreement. The unpaid interest accrued on each
overdue amount in accordance with the foregoing terms of this paragraph shall
become and be absolutely due and payable by the Borrower to Bank on demand by
the Agent. Interest on each overdue

                                       A-1


amount will continue to accrue as provided by the foregoing terms of this
paragraph, and will (to the extent permitted by applicable law) be compounded
daily until the obligations of the Borrower in respect of the payment of such
overdue amount shall be discharged (whether before or after judgment).

    Each payment of principal, interest or other sum payable on or in respect of
this Note or the indebtedness evidenced hereby shall be made by the Borrower
directly to the Agent in Dollars, for the account of the Bank, at the Agent's
Head Office, on the due date of such payment, and in immediately available and
freely transferable funds. All payments on or in respect of this Note or the
indebtedness evidenced hereby shall be made without set-off or counterclaim and
free and clear of and without any deductions, withholdings, restrictions or
conditions of any nature.

    This Note is made and delivered by the Borrower to the Bank pursuant to a
Third Amended and Restated Revolving Credit Agreement, dated as of January __,
2003, among (i) the Borrower, (ii) the Banks party thereto and (iii) the Bank[,
in its capacity as a Bank and as Agent] (hereinafter, as originally executed,
and as varied, supplemented, amended and/or restated, called the "Revolving
Credit Agreement"). This Note evidences the obligations of the Borrower (a) to
repay the principal amount of the Bank's Commitment Percentage of the Revolving
Credit Loans made by the Bank to the Borrower pursuant to the Revolving Credit
Agreement; (b) to pay interest, as herein provided, on the principal amount
hereof remaining unpaid from time to time; and (c) to pay other amounts which
may become due and payable hereunder or thereunder. Reference is hereby made to
the Revolving Credit Agreement (including the EXHIBITS annexed thereto) for a
complete statement of the terms thereof.

    The Borrower has the right to prepay the unpaid principal of this Note in
full or in part upon the terms contained in the Revolving Credit Agreement. The
Borrower has an obligation to prepay principal of this Note from time to time if
and to the extent required under, and upon the terms contained in, the Revolving
Credit Agreement. Any partial payment of the indebtedness evidenced by this Note
shall be applied in accordance with the terms of the Revolving Credit Agreement.

    Pursuant to and upon the terms contained in Section 14 of the Revolving
Credit Agreement, the entire unpaid principal of this Note, all of the interest
accrued on the unpaid principal of this Note and all (if any) other amounts
payable on or in respect of this Note or the indebtedness evidenced hereby may
be declared to be immediately due and payable, whereupon the entire unpaid
principal of this Note, all of the interest accrued on the unpaid principal of
this Note and all (if any) other amounts payable on or in respect of this Note
or the indebtedness evidenced hereby shall (if not already due and payable)
forthwith become and be, or the same may, as provided in said Section 14,
automatically become, due and payable to the Bank without presentment, demand,
protest or any other formalities of any kind, all of which are hereby expressly
and irrevocably

                                       A-2


waived by the Borrower, excepting only for notice expressly provided for in the
Revolving Credit Agreement.

    All computations of interest payable as provided in this Note shall be made
by the Agent on the basis of the actual number of days elapsed divided by 360.
The interest rate in effect from time to time shall be determined in accordance
with the terms of the Revolving Credit Agreement.

    Should all or any part of the indebtedness represented by this Note be
collected by action at law, or in bankruptcy, insolvency, receivership or other
court proceedings, or should this Note be placed in the hands of attorneys for
collection after default, the Borrower hereby promises to pay to the holder of
this Note, upon demand by the holder hereof at any time, in addition to
principal, interest and all (if any) other amounts payable on or in respect of
this Note or the indebtedness evidenced hereby, all court costs and attorneys'
fees and all other collection charges and expenses reasonably incurred or
sustained by the holder of this Note.

    The Borrower hereby irrevocably waives notice of acceptance, presentment,
notice of nonpayment, protest, notice of protest, suit and all other conditions
precedent in connection with the delivery, acceptance, collection and/or
enforcement of this Note, except for notices expressly provided for in the
Revolving Credit Agreement. The Borrower hereby absolutely and irrevocably
consents and submits to the jurisdiction of the Courts of the Commonwealth of
Massachusetts sitting in Suffolk County and of any Federal Court located in the
Eastern District of Massachusetts in connection with any actions or proceedings
brought against the Borrower by the holder hereof arising out of or relating to
this Note. This Note may be executed in any number of counterparts and by each
party on a separate counterpart, each of which when so executed and delivered
shall be an original, and all of which together shall constitute one instrument.

                  (Remainder of page intentionally left blank)

                                       A-3


    This Note is intended to take effect as a sealed instrument. This Note and
the obligations of the Borrower hereunder shall be governed by and interpreted
and determined in accordance with the laws of the Commonwealth of Massachusetts.

    Each Borrower shall be jointly and severally liable for the full amount
owing under this Note.

    IN WITNESS WHEREOF, this REVOLVING CREDIT NOTE has been duly executed by the
undersigned on the day and in the year first above written in Boston,
Massachusetts.

                                 332 HARTWELL AVENUE, LEXINGTON, MA**

                                 MBZ-LEX TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

- ----------
** The designation of the specific Real Estate Asset or Assets owned by any
signatory to this Agreement or any other Loan Document is for informational
purposes only and does not in any way limit the joint and several liability of
each Borrower, for so long as it is a Borrower, for the Obligations.

                                       A-4


                                 WALTHAM OFFICE CENTER, WALTHAM, MA

                                 ZEE EM TRUST II

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                       A-5


                                 204 SECOND AVENUE, WALTHAM, MA

                                 WP TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 170 TRACER LANE, WALTHAM, MA

                                 TRACER LANE TRUST II

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                       A-6


                                 33 HAYDEN AVENUE, LEXINGTON, MA

                                 HAYDEN OFFICE TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 92 AND 100 HAYDEN AVENUE, LEXINGTON, MA

                                 92 HAYDEN AVENUE TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                       A-7


                                 LEXINGTON OFFICE PARK, 420-430 BEDFORD STREET,
                                 LEXINGTON, MA

                                 ELANDZEE TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 40-46 HARVARD STREET, WESTWOOD, MA

                                 40-46 HARVARD STREET TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                       A-8


                                 17 HARTWELL AVENUE, LEXINGTON, MA

                                 ZEE BEE TRUST II

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 ONE CAMBRIDGE CENTER, CAMBRIDGE, MA

                                 ONE CAMBRIDGE CENTER TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                       A-9


                                 THREE CAMBRIDGE CENTER, CAMBRIDGE, MA

                                 THREE CAMBRIDGE CENTER TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 ELEVEN CAMBRIDGE CENTER, CAMBRIDGE, MA

                                 ELEVEN CAMBRIDGE CENTER TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                      A-10


                                 FOURTEEN CAMBRIDGE CENTER, CAMBRIDGE, MA

                                 FOURTEEN CAMBRIDGE CENTER TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 500 E STREET, S.W., WASHINGTON, D.C.

                                 SCHOOL STREET ASSOCIATES LIMITED PARTNERSHIP

                                 By:  Boston Properties LLC, its sole general
                                      partner

                                      By:  Boston Properties Limited
                                           Partnership, its managing member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   -------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer

                                      A-11


                                 LONG WHARF MARRIOTT, BOSTON, MA

                                 DOWNTOWN BOSTON PROPERTIES TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                                By: /s/ Douglas T. Linde
                                                   -------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer


                                 CAMBRIDGE CENTER MARRIOTT, CAMBRIDGE, MA

                                 TWO CAMBRIDGE CENTER TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                      A-12


                                 DECOVERLY TWO, ROCKVILLE, MD

                                 DECOVERLY TWO LIMITED PARTNERSHIP

                                 By:  Boston Properties LLC, its general partner

                                      By:  Boston Properties Limited
                                           Partnership, its Managing Member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   -------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer


                                 THE CANDLER BUILDING, 111 MARKET PLACE,
                                 BALTIMORE, MD

                                 CANDLER ASSOCIATES L.L.C.

                                 By:  Boston Properties Limited Partnership,
                                      its managing member

                                      By:  Boston Properties, Inc., its general
                                           partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                      A-13


                                 104 CARNEGIE CENTER, PRINCETON, NJ

                                 CARNEGIE CENTER ASSOCIATES

                                 By:  Boston Properties Limited Partnership, its
                                      general partner

                                      By:  Boston Properties, Inc., its general
                                           partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 105 CARNEGIE CENTER, PRINCETON, NJ

                                 CARNEGIE CENTER ASSOCIATES

                                 By:  Boston Properties Limited Partnership, its
                                      general partner

                                      By:  Boston Properties, Inc., its general
                                           partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                      A-14



                                 210 CARNEGIE CENTER, PRINCETON, NJ

                                 210 ASSOCIATES LIMITED PARTNERSHIP

                                 By:  Boston Properties LLC, its general partner

                                      By:  Boston Properties Limited
                                           Partnership, its managing member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   -------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer


                                 211 CARNEGIE CENTER, PRINCETON, NJ

                                 211 ASSOCIATES LIMITED PARTNERSHIP

                                 By:  Boston Properties LLC, its general partner

                                      By:  Boston Properties Limited
                                           Partnership, its managing member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   -------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer

                                      A-15


                                 CAMBRIDGE CENTER NORTH GARAGE, CAMBRIDGE, MA

                                 CAMBRIDGE CENTER NORTH TRUST

                                 By:  Boston Properties Limited Partnership, its
                                      beneficiary

                                      By:  Boston Properties, Inc., its general
                                           partner

                                           By: /s/ Douglas T. Linde
                                              -------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 9509 KEY WEST AVENUE, DECOVERLY SEVEN,
                                 ROCKVILLE, MD

                                 DECOVERLY SEVEN LIMITED PARTNERSHIP

                                 By:  Boston Properties LLC, its general partner

                                      By:  Boston Properties Limited
                                           Partnership, its managing member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   -------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer

                                      A-16


                                 ONE TOWER CENTER, EAST BRUNSWICK, NJ

                                 SCV PARTNERS

                                 By:  BP III LLC, its general partner

                                      By:  Boston Properties Limited
                                           Partnership, its managing member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   ----------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer


                                 201 CARNEGIE CENTER, PRINCETON, NJ

                                 PRINCETON CHILDCARE ASSOCIATES
                                 LIMITED PARTNERSHIP

                                 By:  Boston Properties LLC, its sole general
                                      partner

                                      By:  Boston Properties Limited
                                           Partnership, its managing member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   -------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer


                                 399 PARK AVENUE, NEW YORK, NY

                                 195 WEST STREET, WALTHAM, MA

                                 7435 BOSTON BOULEVARD, BUILDING ONE,
                                 SPRINGFIELD, VA

                                      A-17


                                 7451 BOSTON BOULEVARD, BUILDING TWO,
                                 SPRINGFIELD, VA

                                 7374 BOSTON BOULEVARD, BUILDING FOUR,
                                 SPRINGFIELD, VA

                                 8000 GRAINGER COURT, BUILDING FIVE,
                                 SPRINGFIELD, VA

                                 7500 BOULEVARD, BUILDING SIX,
                                 SPRINGFIELD, VA

                                 7501 BOSTON BOULEVARD, BUILDING SEVEN,
                                 SPRINGFIELD, VA

                                 7601 BOSTON BOULEVARD, BUILDING EIGHT,
                                 SPRINGFIELD, VA

                                 7375 BOSTON BOULEVARD, BUILDING TEN,
                                 SPRINGFIELD, VA

                                 7300 BOSTON BOULEVARD, BUILDING THIRTEEN,
                                 SPRINGFIELD, VA

                                 8000 CORPORATE COURT, BUILDING ELEVEN,
                                 SPRINGFIELD, VA

                                 38 CABOT BOULEVARD, BUCKS COUNTY, PA

                                 365 HERNDON PARKWAY (SUGARLAND I),
                                 HERNDON, VA

                                 397 HERNDON PARKWAY (SUGARLAND II),
                                 HERNDON, VA

                                 164 LEXINGTON ROAD, BILLERICA, MA

                                 THE ARBORETUM, 12700 SUNRISE VALLEY DRIVE,
                                 RESTON, VA

                                 502 CARNEGIE CENTER, PRINCETON, NJ

                                 RESIDENCE INN, CAMBRIDGE, MA

                                      A-18


                                 212 CARNEGIE CENTER, PRINCETON, NJ

                                 NEWPORT OFFICE CENTER, QUINCY, MA

                                 ORBITAL SCIENCES - PHASE I, DULLES, VA

                                 DECOVERLY THREE, 15204 OMEGA DRIVE, ROCKVILLE,
                                 MD

                                 7450 BOSTON BOULEVARD, BUILDING THREE,
                                 SPRINGFIELD, VA

                                 200 WEST STREET, WALTHAM, MA

                                 Broad Run Business Park Building E,
                                 MORAN ROAD, LEESBURG VA 20175

                                 BOSTON PROPERTIES LIMITED PARTNERSHIP


                                 By:  Boston Properties, Inc., its sole general
                                      partner

                                      By: /s/ Douglas T. Linde
                                         -------------------------(SEAL)
                                         Douglas T. Linde
                                         Senior Vice President and
                                         Chief Financial Officer

                                      A-19


                                                                     EXHIBIT A-1

                                 SWINGLINE NOTE

$60,000,000                                       Date:  January __, 2003

    FOR VALUE RECEIVED, the undersigned Boston Properties Limited Partnership, a
Delaware limited partnership, and each of the other undersigned parties and
other parties who are or from time to time become a Borrower under (and as
defined in) the Revolving Credit Agreement referred to below (hereinafter,
together with their respective successors in title and assigns, collectively
called the "Borrower"), by this promissory note (hereinafter, called "this
Note"), absolutely and unconditionally and jointly and severally promise to pay
to the order of FLEET NATIONAL BANK (hereinafter, together with its successors
in title and assigns, called the "Bank"), the principal sum of Sixty Million and
00/100 Dollars ($60,000,000), or so much thereof as shall have been advanced by
the Bank to the Borrower by way of Swingline Loans under (and as defined in) the
Revolving Credit Agreement and shall remain outstanding, such payment to be made
as hereinafter provided, and to pay interest on the principal sum outstanding
hereunder from time to time from and after the date hereof until the said
principal sum or the unpaid portion thereof shall have become due and payable as
hereinafter provided.

    Capitalized terms used herein without definition shall have the meanings set
forth in the Revolving Credit Agreement.

    The unpaid principal (not at the time overdue) under this Note shall bear
interest at the rate or rates from time to time in effect under the Revolving
Credit Agreement. Accrued interest on the unpaid principal under this Note shall
be payable on the dates specified in the Revolving Credit Agreement.

    On the maturity date of any particular Swingline Loan as provided in the
Revolving Credit Agreement, and in any event on the Maturity Date, there shall
become absolutely due and payable by the Borrower hereunder, and the Borrower
hereby promises to pay to the Bank, the balance (if any) of the principal hereof
then remaining unpaid, all of the unpaid interest accrued hereon and all (if
any) other amounts payable on or in respect of this Note or the indebtedness
evidenced hereby.

    Each overdue amount (whether of principal, interest or otherwise) payable on
or in respect of this Note or the indebtedness evidenced hereby shall (to the
extent permitted by applicable law) bear interest at the rates and on the terms
provided in the Revolving Credit Agreement. The unpaid interest accrued on each
overdue amount in accordance with the foregoing terms of this paragraph shall
become and be absolutely due and payable by the Borrower to Bank on demand by
the Agent. Interest on each overdue

                                      A-1-1


amount will continue to accrue as provided by the foregoing terms of this
paragraph, and will (to the extent permitted by applicable law) be compounded
daily until the obligations of the Borrower in respect of the payment of such
overdue amount shall be discharged (whether before or after judgment).

    Each payment of principal, interest or other sum payable on or in respect of
this Note or the indebtedness evidenced hereby shall be made by the Borrower
directly to the Agent in Dollars, for the account of the Bank, at the Agent's
Head Office, on the due date of such payment, and in immediately available and
freely transferable funds. All payments on or in respect of this Note or the
indebtedness evidenced hereby shall be made without set-off or counterclaim and
free and clear of and without any deductions, withholdings, restrictions or
conditions of any nature.

    This Note is made and delivered by the Borrower to the Bank pursuant to a
Third Amended and Restated Revolving Credit Agreement, dated as of January __,
2003, among (i) the Borrower, (ii) the Banks party thereto and (iii) the Bank,
in its capacity as a Bank and as Agent (hereinafter, as originally executed, and
as varied, supplemented, amended and/or restated, called the "Revolving Credit
Agreement"). This Note evidences the obligations of the Borrower (a) to repay
the principal amount of the Swingline Loans made by the Bank to the Borrower
pursuant to the Revolving Credit Agreement; (b) to pay interest, as herein
provided, on the principal amount hereof remaining unpaid from time to time; and
(c) to pay other amounts which may become due and payable hereunder or
thereunder. Reference is hereby made to the Revolving Credit Agreement
(including the EXHIBITS annexed thereto) for a complete statement of the terms
thereof.

    The Borrower has the right to prepay the unpaid principal of this Note in
full or in part upon the terms contained in the Revolving Credit Agreement. The
Borrower has an obligation to prepay principal of this Note from time to time if
and to the extent required under, and upon the terms contained in, the Revolving
Credit Agreement. Any partial payment of the indebtedness evidenced by this Note
shall be applied in accordance with the terms of the Revolving Credit Agreement.

    Pursuant to and upon the terms contained in Section 14 of the Revolving
Credit Agreement, the entire unpaid principal of this Note, all of the interest
accrued on the unpaid principal of this Note and all (if any) other amounts
payable on or in respect of this Note or the indebtedness evidenced hereby may
be declared to be immediately due and payable, whereupon the entire unpaid
principal of this Note, all of the interest accrued on the unpaid principal of
this Note and all (if any) other amounts payable on or in respect of this Note
or the indebtedness evidenced hereby shall (if not already due and payable)
forthwith become and be, or the same may, as provided in said Section 14,
automatically become, due and payable to the Bank without presentment, demand,
protest or any other formalities of any kind, all of which are hereby expressly
and irrevocably

                                      A-1-2


waived by the Borrower, excepting only for notice expressly provided for in the
Revolving Credit Agreement.

    All computations of interest payable as provided in this Note shall be made
by the Agent on the basis of the actual number of days elapsed divided by 360.
The interest rate in effect from time to time shall be determined in accordance
with the terms of the Revolving Credit Agreement.

    Should all or any part of the indebtedness represented by this Note be
collected by action at law, or in bankruptcy, insolvency, receivership or other
court proceedings, or should this Note be placed in the hands of attorneys for
collection after default, the Borrower hereby promises to pay to the holder of
this Note, upon demand by the holder hereof at any time, in addition to
principal, interest and all (if any) other amounts payable on or in respect of
this Note or the indebtedness evidenced hereby, all court costs and attorneys'
fees and all other collection charges and expenses reasonably incurred or
sustained by the holder of this Note.

    The Borrower hereby irrevocably waives notice of acceptance, presentment,
notice of nonpayment, protest, notice of protest, suit and all other conditions
precedent in connection with the delivery, acceptance, collection and/or
enforcement of this Note, except for notices expressly provided for in the
Revolving Credit Agreement. The Borrower hereby absolutely and irrevocably
consents and submits to the jurisdiction of the Courts of the Commonwealth of
Massachusetts sitting in Suffolk County and of any Federal Court located in the
Eastern District of Massachusetts in connection with any actions or proceedings
brought against the Borrower by the holder hereof arising out of or relating to
this Note. This Note may be executed in any number of counterparts and by each
party on a separate counterpart, each of which when so executed and delivered
shall be an original, and all of which together shall constitute one instrument.


                  (Remainder of page intentionally left blank)

                                      A-1-3


    This Note is intended to take effect as a sealed instrument. This Note and
the obligations of the Borrower hereunder shall be governed by and interpreted
and determined in accordance with the laws of the Commonwealth of Massachusetts.

    Each Borrower shall be jointly and severally liable for the full amount
owing under this Note.

    IN WITNESS WHEREOF, this SWINGLINE NOTE has been duly executed by the
undersigned on the day and in the year first above written in Boston,
Massachusetts.

                                 332 HARTWELL AVENUE, LEXINGTON, MA**

                                 MBZ-LEX TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 WALTHAM OFFICE CENTER, WALTHAM, MA

                                 ZEE EM TRUST II

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President

- ----------
** The designation of the specific Real Estate Asset or Assets owned by any
signatory to this Agreement or any other Loan Document is for informational
purposes only and does not in any way limit the joint and several liability of
each Borrower, for so long as it is a Borrower, for the Obligations.

                                      A-1-4


                                              and Chief Financial Officer

                                      A-1-5



                                 204 SECOND AVENUE, WALTHAM, MA

                                 WP TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 170 TRACER LANE, WALTHAM, MA

                                 TRACER LANE TRUST II

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                      A-1-6


                                 33 HAYDEN AVENUE, LEXINGTON, MA

                                 HAYDEN OFFICE TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 92 AND 100 HAYDEN AVENUE, LEXINGTON, MA

                                 92 HAYDEN AVENUE TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                      A-1-7


                                 LEXINGTON OFFICE PARK, 420-430 BEDFORD STREET,
                                 LEXINGTON, MA

                                 ELANDZEE TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 40-46 HARVARD STREET, WESTWOOD, MA

                                 40-46 HARVARD STREET TRUST

                                 By:  Boston Properties Limited Partnership,
                                 its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                      A-1-8


                                 17 HARTWELL AVENUE, LEXINGTON, MA

                                 ZEE BEE TRUST II

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 ONE CAMBRIDGE CENTER, CAMBRIDGE, MA

                                 ONE CAMBRIDGE CENTER TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                      A-1-9


                                 THREE CAMBRIDGE CENTER, CAMBRIDGE, MA

                                 THREE CAMBRIDGE CENTER TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 ELEVEN CAMBRIDGE CENTER, CAMBRIDGE, MA

                                 ELEVEN CAMBRIDGE CENTER TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                     A-1-10


                                 FOURTEEN CAMBRIDGE CENTER, CAMBRIDGE, MA

                                 FOURTEEN CAMBRIDGE CENTER TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 500 E STREET, S.W., WASHINGTON, D.C.

                                 SCHOOL STREET ASSOCIATES LIMITED PARTNERSHIP

                                 By:  Boston Properties LLC, its sole general
                                      partner

                                      By:  Boston Properties Limited
                                           Partnership, its managing member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   ----------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer

                                     A-1-11


                                 LONG WHARF MARRIOTT, BOSTON, MA

                                 DOWNTOWN BOSTON PROPERTIES TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 CAMBRIDGE CENTER MARRIOTT, CAMBRIDGE, MA

                                 TWO CAMBRIDGE CENTER TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                     A-1-12


                                 DECOVERLY TWO, ROCKVILLE, MD

                                 DECOVERLY TWO LIMITED PARTNERSHIP

                                 By:  Boston Properties LLC, its general partner

                                      By:  Boston Properties Limited
                                           Partnership, its Managing Member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   ----------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer

                                 THE CANDLER BUILDING, 111 MARKET PLACE,
                                 BALTIMORE, MD

                                 CANDLER ASSOCIATES L.L.C.

                                 By:  Boston Properties Limited Partnership,
                                      its managing member

                                      By:  Boston Properties, Inc., its general
                                           partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                     A-1-13


                                 104 CARNEGIE CENTER, PRINCETON, NJ

                                 CARNEGIE CENTER ASSOCIATES

                                 By:  Boston Properties Limited Partnership, its
                                      general partner

                                      By:  Boston Properties, Inc., its general
                                           partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 105 CARNEGIE CENTER, PRINCETON, NJ

                                 CARNEGIE CENTER ASSOCIATES

                                 By:  Boston Properties Limited Partnership, its
                                      general partner

                                      By:  Boston Properties, Inc., its general
                                           partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                     A-1-14


                                 210 CARNEGIE CENTER, PRINCETON, NJ

                                 210 ASSOCIATES LIMITED PARTNERSHIP

                                 By:  Boston Properties LLC, its general partner

                                      By:  Boston Properties Limited
                                           Partnership, its managing member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   ----------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer


                                 211 CARNEGIE CENTER, PRINCETON, NJ

                                 211 ASSOCIATES LIMITED PARTNERSHIP

                                 By:  Boston Properties LLC, its general partner

                                      By:  Boston Properties Limited
                                           Partnership, its managing member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   ----------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer

                                     A-1-15


                                 CAMBRIDGE CENTER NORTH GARAGE, CAMBRIDGE, MA

                                 CAMBRIDGE CENTER NORTH TRUST

                                 By:  Boston Properties Limited Partnership, its
                                      beneficiary

                                      By:  Boston Properties, Inc., its general
                                           partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 9509 KEY WEST AVENUE, DECOVERLY SEVEN,
                                 ROCKVILLE, MD

                                 DECOVERLY SEVEN LIMITED PARTNERSHIP

                                 By:  Boston Properties LLC, its general partner

                                      By:  Boston Properties Limited
                                           Partnership, its managing member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   ----------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer

                                     A-1-16


                                 ONE TOWER CENTER, EAST BRUNSWICK, NJ

                                 SCV PARTNERS

                                 By:  BP III LLC, its general partner

                                      By:  Boston Properties Limited
                                           Partnership, its managing member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   ----------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer


                                 201 CARNEGIE CENTER, PRINCETON, NJ

                                 PRINCETON CHILDCARE ASSOCIATES
                                 LIMITED PARTNERSHIP

                                 By:  Boston Properties LLC, its sole general
                                      partner

                                      By:  Boston Properties Limited
                                           Partnership, its managing member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   ----------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer


                                 399 PARK AVENUE, NEW YORK, NY

                                 195 WEST STREET, WALTHAM, MA

                                 7435 BOSTON BOULEVARD, BUILDING ONE,
                                 SPRINGFIELD, VA

                                     A-1-17


                                 7451 BOSTON BOULEVARD, BUILDING TWO,
                                 SPRINGFIELD, VA

                                 7374 BOSTON BOULEVARD, BUILDING FOUR,
                                 SPRINGFIELD, VA

                                 8000 GRAINGER COURT, BUILDING FIVE,
                                 SPRINGFIELD, VA

                                 7500 BOULEVARD, BUILDING SIX,
                                 SPRINGFIELD, VA

                                 7501 BOSTON BOULEVARD, BUILDING SEVEN,
                                 SPRINGFIELD, VA

                                 7601 BOSTON BOULEVARD, BUILDING EIGHT,
                                 SPRINGFIELD, VA

                                 7375 BOSTON BOULEVARD, BUILDING TEN,
                                 SPRINGFIELD, VA

                                 7300 BOSTON BOULEVARD, BUILDING THIRTEEN,
                                 SPRINGFIELD, VA

                                 8000 CORPORATE COURT, BUILDING ELEVEN,
                                 SPRINGFIELD, VA

                                 38 CABOT BOULEVARD, BUCKS COUNTY, PA

                                 365 HERNDON PARKWAY (SUGARLAND I),
                                 HERNDON, VA

                                 397 HERNDON PARKWAY (SUGARLAND II),
                                 HERNDON, VA

                                 164 LEXINGTON ROAD, BILLERICA, MA

                                 THE ARBORETUM, 12700 SUNRISE VALLEY DRIVE,
                                 RESTON, VA

                                 502 CARNEGIE CENTER, PRINCETON, NJ

                                 RESIDENCE INN, CAMBRIDGE, MA

                                     A-1-18


                                 212 CARNEGIE CENTER, PRINCETON, NJ

                                 NEWPORT OFFICE CENTER, QUINCY, MA

                                 ORBITAL SCIENCES - PHASE I, DULLES, VA

                                 DECOVERLY THREE, 15204 OMEGA DRIVE, ROCKVILLE,
                                 MD

                                 7450 BOSTON BOULEVARD, BUILDING THREE,
                                 SPRINGFIELD, VA

                                 200 WEST STREET, WALTHAM, MA

                                 Broad Run Business Park Building E,
                                 MORAN ROAD, LEESBURG VA 20175

                                 BOSTON PROPERTIES LIMITED PARTNERSHIP


                                 By:  Boston Properties, Inc., its sole general
                                      partner

                                      By: /s/ Douglas T. Linde
                                         ----------------------(SEAL)
                                         Douglas T. Linde
                                         Senior Vice President and
                                         Chief Financial Officer

                                     A-1-19


                                                                       EXHIBIT B

                                  LOAN REQUEST

    This Loan Request is made pursuant to Section 2.4/Section 2.5/Section 2.8 of
the Third Amended and Restated Revolving Credit Agreement dated as of January
__, 2003 among Boston Properties Limited Partnership (the "Borrower"), Fleet
National Bank individually and as Agent, and certain other Banks as provided
therein (as the same may be amended from time to time, the "Credit Agreement").
Unless otherwise defined herein, the terms used in this Loan Request have the
meanings described in the Credit Agreement.

    Each Loan Request submitted by the Borrower shall be a request for a single
Loan or Letter of Credit.

1.  The Borrower hereby requests (check each applicable item):

    / / New Revolving Credit Loan ($_______________)
    / / New Swingline Loan ($______________)
    / / Conversion of Existing Revolving Credit Loan ($_______________)
          (Current Interest Period ending on _________, 20__)
    / / Continuation of Existing Revolving Credit Loan ($_______________)
           (Current Interest Period ending on _________, 20__)
    / / Letter of Credit (Fronting Bank is _____________)

2.  The Type of Loan being requested in this Loan Request (if any) is:

    / / Prime Rate Loan
    / / Eurodollar Rate Loan

3.  The aggregate principal amount of the Loan or the amount of the Letter of
    Credit requested (whether by way of a new advance, continuation or
    conversion) in this Loan Request is:

    $
     ------------------

4.  The proposed Drawdown Date of the Revolving Credit Loan, drawdown date of
    the Swingline Loan or the date of issue, extension or renewal of the Letter
    of Credit requested in this Loan Request is:

    ___________________, 20__

                                       B-1


5.  The Interest Period requested for the Loan requested in this Loan Request
    (if any) is:

    _________________ through __________________.


    WITNESS my hand this ____ day of _____________, 20__.

                                 BOSTON PROPERTIES LIMITED
                                 PARTNERSHIP, for itself and as agent for
                                 each other Borrower

                                 By:  Boston Properties, Inc., its
                                      general partner

                                 By:
                                    --------------------------------------
                                    Title:

                                       B-2


                                    EXHIBIT C

                (Exhibit C consists of Exhibits C-1 through C-7)

                                                                     EXHIBIT C-1

         COMPLIANCE CERTIFICATE OF CHIEF FINANCIAL OFFICER, TREASURER OR
                                   CONTROLLER
                                 (Loan Request)

    The undersigned (collectively, the "Borrower") HEREBY CERTIFIES THAT:

    This Compliance Certificate is furnished pursuant to Section 2.4(iv)(c),
Section 2.8, Section 2.9, Section 3.1.1 and/or Section 13.1 of the Third Amended
and Restated Revolving Credit Agreement dated as of January __, 2003 among the
Borrower, Fleet National Bank, individually and as Agent, and certain other
Banks as provided therein (as the same may be amended from time to time, the
"Credit Agreement"). Unless otherwise defined herein, the terms used in this
Compliance Certificate and Schedule 1 attached hereto have the meanings
described in the Credit Agreement.

    Schedule 1 attached hereto sets forth the financial data and computations
evidencing the Borrower's compliance with the covenants contained in Section 10
of the Credit Agreement and with the definition of Borrowing Base Availability
on a pro-forma basis after giving effect to the requested Loan and/or Letter of
Credit, all of which data and computations, to the best knowledge and belief of
the chief financial officer or treasurer executing and delivering this
Compliance Certificate on behalf of the Borrower (the "Chief Financial Officer"
or "Treasurer", as the case may be), are true, complete and correct.

    The activities of the Borrower, BPI and their respective Subsidiaries since
the date of the last Compliance Certificate submitted by the Borrower to the
Agent have been reviewed by the Chief Financial Officer/Treasurer and/or by
employees or agents under his/her immediate supervision. Based upon such review,
to the best knowledge and belief of the Chief Financial Officer/Treasurer, both
before and after giving effect to the requested Loan and/or Letter of Credit,
(1) no Default or Event of Default exists on the date hereof or will exist under
the Credit Agreement or any other Loan Document on the Drawdown Date (or
drawdown date) of such Loan or the date of [issue] [extension or renewal] of
such Letter of Credit, and (2) after taking into account such requested Loan or
Letter of Credit, no Default or Event of Default will exist as of the Drawdown
Date or drawdown date of such Loan or date of [issue] [extension or renewal] of
such Letter of Credit.

    To the best knowledge and belief of the Chief Financial Officer/Treasurer,
each of the representations and warranties of the Borrower and BPI contained in
the Credit

                                      C-1-1


Agreement, the other Loan Documents or in any document or instrument delivered
pursuant to or in connection with the Credit Agreement was true as of the date
as of which they were made and is also true at and as of the date hereof and
will be true at and as of the time of the making of the requested Loan or the
[issuance] [extension or renewal] of the requested Letter of Credit, with the
same effect as if made at and as of that time except to the extent that such
representations and warranties relate expressly to an earlier date.

    The Chief Financial Officer/Treasurer/Controller certifies that he/she is
authorized to execute and deliver this Compliance Certificate on behalf of each
Borrower.

    WITNESS my hand this _ day of _______________, 20__

                                 BOSTON PROPERTIES LIMITED
                                 PARTNERSHIP, for itself and as agent for
                                 each other Borrower


                                 By:  Boston Properties, Inc., its
                                      general partner


                                 By:
                                    -------------------------------
                                    Title:

                                      C-1-2


                                                                     EXHIBIT C-2

                COMPLIANCE CERTIFICATE OF CHIEF FINANCIAL OFFICER
                         (Borrower Financial Statements)

    The undersigned (the "Borrower") HEREBY CERTIFIES THAT:

    This Compliance Certificate is furnished pursuant to Section 8.4(e) of the
Third Amended and Restated Revolving Credit Agreement dated as of January __,
2003 among the Borrower, Fleet National Bank, individually and as Agent, and
certain other Banks as provided therein (as the same may be amended from time to
time, the "Credit Agreement"). Unless otherwise defined herein, the terms used
in this Compliance Certificate and Schedule 1 attached hereto have the meanings
described in the Credit Agreement.

    As required by Section 8.4(e) of the Credit Agreement, financial statements
of the Borrower and its respective subsidiaries (as defined in the Credit
Agreement) for the [year] [quarter] ended 20_ (the "Financial Statements")
prepared in accordance with GAAP (subject, in the case of quarterly statements,
to year-end adjustments none of which are anticipated to be materially adverse,
except as specifically disclosed in this Compliance Certificate) accompany this
Compliance Certificate. The Financial Statements present fairly the financial
position of the Borrower and its subsidiaries (as defined in the Credit
Agreement) as at the date thereof and the results of operations of the Borrower
and its subsidiaries for the period covered thereby.

    Schedule 1 attached hereto sets forth the financial data and computations
evidencing the Borrower's compliance with the covenants contained in Section 10
of the Credit Agreement, all of which data and computations, to the best
knowledge and belief of the chief financial officer executing and delivering
this Compliance Certificate on behalf of the Borrower (the "Chief Financial
Officer"), are true, complete and correct.

    The activities of the Borrower and its Subsidiaries (as defined in the
Credit Agreement) during the period covered by the Financial Statements have
been reviewed by the Chief Financial Officer and/or by employees or agents under
his immediate supervision. Based upon such review, during the period covered by
the Financial Statements, and as of the date of this Certificate, no Default or
Event of Default has occurred and is continuing of which (i) the Borrower has
knowledge, and (ii) the Agent has not previously given notice, except as
specifically disclosed in this Compliance Certificate.

    The Chief Financial Officer certifies that he is authorized to execute and
deliver

                                      C-2-1


this Compliance Certificate on behalf of the Borrower.

    WITNESS our hands this ____ day of ___________________, 20__.

                                 BOSTON PROPERTIES LIMITED
                                 PARTNERSHIP, for itself and as agent for
                                 each other Borrower


                                 By:  Boston Properties, Inc., its
                                      general partner


                                 By:
                                    --------------------------------
                                        Title:  Chief Financial Officer

                                      C-2-2


                                                                     EXHIBIT C-3

                            [Intentionally Omitted.]

                                      C-3-1


                                                                     EXHIBIT C-4

              COMPLIANCE CERTIFICATE OF CHIEF FINANCIAL OFFICER OR
                                    TREASURER

               (Disposition/Removal of Borrowing Base Properties)

    The undersigned (the "Borrower") HEREBY CERTIFIES THAT: This Compliance
Certificate is furnished pursuant to Section 8.14/Section 9.4(a) or (b)/Section
14.1 of the Third Amended and Restated Revolving Credit Agreement dated as of
January __, 2003 among the Borrower, Fleet National Bank, individually and as
Agent, and certain other Banks as provided therein (as the same may be amended
from time to time, the "Credit Agreement"). The Borrower hereby gives the Agent
notice of its intention to Sell a Borrowing Base Property or to grant an
Indebtedness Lien on a Borrowing Base Property or remove a Borrowing Base
Property from the Borrowing Base pursuant to Section 8.14/Section 9.4(a) or
(b)/Section 14.1 of the Credit Agreement. Unless otherwise defined herein, the
terms used in this Compliance Certificate and Schedule 1 attached hereto have
the meanings described in the Credit Agreement.

    Schedule 1 attached hereto sets forth the financial data and computations
evidencing the Borrower's compliance with the covenants contained in Section 10
of the Credit Agreement on a PRO FORMA basis after giving effect to such
proposed Sale, Indebtedness Lien or removal of a Real Estate Asset from the
Borrowing Base and all liabilities, fixed or contingent, pursuant thereto, all
of which data and computations, to the best knowledge and belief of the chief
financial officer or treasurer executing and delivering this Compliance
Certificate on behalf of the Borrower (the "Chief Financial Officer" or
"Treasurer", as the case may be), are true, complete and correct.

    The activities of the Borrower, BPI and their respective Subsidiaries (as
defined in the Credit Agreement) have been reviewed by the Chief Financial
Officer/Treasurer and/or by employees or agents under his/her immediate
supervision. Based upon such review, to the best knowledge and belief of the
Chief Financial Officer/Treasurer, both before and after giving effect to the
proposed Sale or Indebtedness Lien, no Default or Event of Default exists or
will exist under any Loan Document.

    The Chief Financial Officer/Treasurer certifies that he/she is authorized to
execute and deliver this Compliance Certificate on behalf of the Borrower and
BPI.

                                      C-4-1


    WITNESS our hands this ____ day of _______________, 20__.

                                 BOSTON PROPERTIES LIMITED
                                 PARTNERSHIP, for itself and as agent for
                                 each other Borrower


                                 By:  Boston Properties, Inc., its
                                      general partner


                                 By:
                                    ----------------------------------
                                       Title:

                                      C-4-2


                                                                     EXHIBIT C-5

         COMPLIANCE CERTIFICATE OF CHIEF FINANCIAL OFFICER OR TREASURER
         (Designation of Real Estate Asset as a Borrowing Base Property)

    The undersigned (the "Borrower") HEREBY CERTIFIES THAT:

    This Compliance Certificate is furnished pursuant to the definition of
"Borrowing Base Properties" set forth in Section 1.1 of the Third Amended and
Restated Revolving Credit Agreement dated as of January __, 2003 among the
Borrower, Fleet National Bank, individually and as Agent, and certain other
Banks as provided therein (as the same may be amended from time to time, the
"Credit Agreement"). The Borrower hereby gives the Agent notice of its intention
to designate an Unencumbered Asset as a Borrowing Base Property pursuant to
clause (f) of the definition of "Borrowing Base Properties" set forth in Section
1.1 of the Credit Agreement. Unless otherwise defined herein, the terms used in
this Compliance Certificate and Schedule 1 attached hereto have the meanings
described in the Credit Agreement.

    The designated Unencumbered Asset meets the criteria for Borrowing Base
Properties set forth in Section 1.1 of the Credit Agreement [except
______________].

    Schedule 1 attached hereto sets forth the financial data and computations
evidencing the Borrower's compliance with the covenants contained in Section 10
of the Credit Agreement on a PRO FORMA basis after giving effect to such
proposed designation, all of which data and computations, to the best knowledge
and belief of the chief financial officer or treasurer executing and delivering
this Compliance Certificate on behalf of the Borrower (the "Chief Financial
Officer" or "Treasurer", as the case may be), are true, complete and correct.

    The activities of the Borrower, BPI and their respective Subsidiaries (as
defined in the Credit Agreement) have been reviewed by the Chief Financial
Officer/Treasurer and/or by employees or agents under his/her immediate
supervision. Based upon such review, to the best knowledge and belief of the
Chief Financial Officer/Treasurer, both before and after giving effect to such
designation, no Default or Event of Default exists or will exist under any Loan
Document.

                                      C-5-1


    The Chief Financial Officer/Treasurer certifies that he/she is authorized to
execute and deliver this Compliance Certificate on behalf of the Borrower and
BPI.

    WITNESS our hands this ____ day of ____________, 200_.

                                 BOSTON PROPERTIES LIMITED
                                 PARTNERSHIP, for itself and as agent for
                                 each other Borrower

                                 By:  Boston Properties, Inc., its
                                      general partner

                                      By:
                                         -------------------------
                                         Title:

                                      C-5-2


                                                                     EXHIBIT C-6

              COMPLIANCE CERTIFICATE OF CHIEF FINANCIAL OFFICER OR
                                    TREASURER

                 (Subsidiary/Non-Borrower Indebtedness Default)

    The undersigned (the "Borrower") HEREBY CERTIFIES THAT: This Compliance
Certificate is furnished pursuant to Section 14.1(f) of the Third Amended and
Restated Revolving Credit Agreement dated as of January __, 2003 among the
Borrower, Fleet National Bank, individually and as Agent, and certain other
Banks as provided therein (as the same may be amended from time to time, the
"Credit Agreement"). The Borrower hereby gives the Agent notice of a condition
described in Section 14.1(f) of the Credit Agreement relating solely to a
non-Borrower Subsidiary or Affiliate of the Borrower (the "Non-Borrower
Entity"). Unless otherwise defined herein, the terms used in this Compliance
Certificate and Schedule 1 attached hereto have the meanings described in the
Credit Agreement.

    Schedule 1 attached hereto sets forth the financial data and computations
evidencing the Borrower's compliance as of the date hereof with the covenants
contained in Section 10 of the Credit Agreement on a PRO FORMA basis after
excluding from the calculation of such covenants the Non-Borrower Entity and all
Real Estate Assets owned by the Non-Borrower Entity, all of which data and
computations, to the best knowledge and belief of the chief financial officer or
treasurer executing and delivering this Compliance Certificate on behalf of the
Borrower (the "Chief Financial Officer" or "Treasurer", as the case may be), are
true, complete and correct.

    The activities of the Borrower, BPI and their respective Subsidiaries have
been reviewed by the Chief Financial Officer/Treasurer and/or by employees or
agents under his/her immediate supervision. Based upon such review, to the best
knowledge and belief of the Chief Financial Officer/Treasurer, after giving
effect to the exclusions discussed in the preceding paragraph, no Default or
Event of Default exists or will exist.

    The Chief Financial Officer/Treasurer certifies that he/she is authorized to
execute and deliver this Compliance Certificate on behalf of the Borrower and
BPI.

                                      C-6-1


    WITNESS our hands this ____ day of _______________, 20__.

                                 BOSTON PROPERTIES LIMITED
                                 PARTNERSHIP, for itself and as agent for
                                 each other Borrower


                                 By:  Boston Properties, Inc., its
                                      general partner


                                 By:
                                    -------------------------------
                                       Title:

                                      C-6-2


                                                                     EXHIBIT C-7

                COMPLIANCE CERTIFICATE OF CHIEF FINANCIAL OFFICER

    The undersigned (the "Borrower") HEREBY CERTIFIES THAT:

    This Compliance Certificate is furnished pursuant to Section 12.17 of the
Third Amended and Restated Revolving Credit Agreement dated as of January __,
2003 among the Borrower, Fleet National Bank, individually and as Agent, and
certain other Banks as provided therein (as the same may be amended from time to
time, the "Credit Agreement"). Unless otherwise defined herein, the terms used
in this Compliance Certificate and Schedule 1 attached hereto have the meanings
described in the Credit Agreement.

    Schedule 1 attached hereto sets forth, as of the date hereof, the financial
data and computations evidencing the Borrower's compliance with the covenants
contained in Section 10 of the Credit Agreement (both before and after giving
effect to the borrowings to be made on the date hereof), all of which data and
computations, to the best knowledge and belief of the chief financial officer
executing and delivering this Compliance Certificate on behalf of the Borrower
(the "Chief Financial Officer"), are true, complete and correct.

    The Chief Financial Officer certifies that he is authorized to execute and
deliver this Compliance Certificate on behalf of the Borrower.

    WITNESS our hands this ____ day of ___________________, 200_.

                                 BOSTON PROPERTIES LIMITED
                                 PARTNERSHIP, for itself and as agent for
                                 each other Borrower


                                 By:  Boston Properties, Inc., its
                                      general partner


                                 By:
                                    -----------------------------------------
                                       Title:  Chief Financial Officer

                                      C-7-1


                                    EXHIBIT D

                (Exhibit D consists of Exhibits D-1 through D-4)

                                                                     EXHIBIT D-1

                              FORM OF BID RATE NOTE

$___________________                                Date: ______________,  20__


    FOR VALUE RECEIVED, the undersigned Boston Properties Limited Partnership, a
Delaware limited partnership, and each of the other undersigned parties and
other parties who are or from time to time become a Borrower under (and as
defined in) the Revolving Credit Agreement referred to (and defined) below
(hereinafter, together with their respective successors in title and assigns,
collectively called the "Borrower"), by this promissory note (hereinafter,
called "this Note"), absolutely and unconditionally and jointly and severally
promise to pay to the order of __________________ (hereinafter, together with
its successors in title and assigns, called the "Bank"), the principal sum of
______________________________ Dollars ($________________) on _________________,
20__, such payment to be made as hereinafter provided, and to pay interest on
the principal sum outstanding hereunder from time to time from and after the
date hereof until the said principal sum or the unpaid portion thereof shall
have become due and payable as provided in the Bid Rate Advance Borrowing Notice
dated __________________, 20__ and attached hereto as Exhibit A.

    Capitalized terms used herein without definition shall have the meanings set
forth in the Revolving Credit Agreement.

    The unpaid principal (not at the time overdue) under this Note shall bear
interest at the rate or rates from time to time in effect under the Revolving
Credit Agreement. Accrued interest on the unpaid principal under this Note shall
be payable on the dates specified in the Revolving Credit Agreement.

    On ____________________, 20__, the date of the final maturity of this Note,
there shall become absolutely due and payable by the Borrower hereunder, and the
Borrower hereby promises to pay to the Bank, the balance (if any) of the
principal hereof then remaining unpaid, all of the unpaid interest accrued
hereon and all (if any) other amounts payable on or in respect of this Note or
the indebtedness evidenced hereby.

                                      D-1-1


    Each overdue amount (whether of principal, interest or otherwise) payable on
or in respect of this Note or the indebtedness evidenced hereby shall (to the
extent permitted by applicable law) bear interest at the rates and on the terms
provided in the Revolving Credit Agreement. The unpaid interest accrued on each
overdue amount in accordance with the foregoing terms of this paragraph shall
become and be absolutely due and payable by the Borrower to Bank on demand by
the Agent. Interest on each overdue amount will continue to accrue as provided
by the foregoing terms of this paragraph, and will (to the extent permitted by
applicable law) be compounded daily until the obligations of the Borrower in
respect of the payment of such overdue amount shall be discharged (whether
before or after judgment).

    Each payment of principal, interest or other sum payable on or in respect of
this Note or the indebtedness evidenced hereby shall be made by the Borrower
directly to the Agent in Dollars, for the account of the Bank, at the Agent's
Head Office, on the due date of such payment, and in immediately available and
freely transferable funds. All payments on or in respect of this Note or the
indebtedness evidenced hereby shall be made without set-off or counterclaim and
free and clear of and without any deductions, withholdings, restrictions or
conditions of any nature.

    This Note is made and delivered by the Borrower to the Bank pursuant to a
Third Amended and Restated Revolving Credit Agreement, dated as of January ___,
2003, among (i) the Borrower, (ii) the Banks party thereto (including the Bank)
and (iii) the Agent (hereinafter, as originally executed, and as varied,
supplemented, amended and/or restated, called the "Revolving Credit Agreement").
This Note evidences the obligations of the Borrower (a) to repay the principal
amount of the Bid Rate Loan evidenced hereby; (b) to pay interest, as herein
provided, on the principal amount hereof remaining unpaid from time to time; and
(c) to pay other amounts which may become due and payable hereunder or in
connection herewith pursuant to the Revolving Credit Agreement. Reference is
hereby made to the Revolving Credit Agreement (including the EXHIBITS annexed
thereto) for a complete statement of the terms thereof.

    The Borrower has the right to prepay the unpaid principal of this Note in
full or in part upon the terms contained in the Revolving Credit Agreement. The
Borrower has an obligation to prepay principal of this Note from time to time if
and to the extent required under, and upon the terms contained in, the Revolving
Credit Agreement. Any partial payment of the indebtedness evidenced by this Note
shall be applied in accordance with the terms of the Revolving Credit Agreement.

    Pursuant to and upon the terms contained in Section 14 of the Revolving
Credit Agreement, the entire unpaid principal of this Note, all of the interest
accrued on the unpaid principal of this Note and all (if any) other amounts
payable on or in respect of this Note or the indebtedness evidenced hereby may
be declared to be immediately due and payable, whereupon the entire unpaid
principal of this Note, all of the interest accrued on the unpaid principal of
this Note and all (if any) other amounts payable on or in

                                      D-1-2


respect of this Note or the indebtedness evidenced hereby shall (if not already
due and payable) forthwith become and be, or the same may, as provided in said
Section 14, automatically become, due and payable to the Bank without
presentment, demand, protest or any other formalities of any kind, all of which
are hereby expressly and irrevocably waived by the Borrower, excepting only for
notice expressly provided for in the Revolving Credit Agreement.

    All computations of interest payable as provided in this Note shall be made
by the Agent on the basis of the actual number of days elapsed divided by 360.
The interest rate in effect from time to time shall be determined in accordance
with the terms of the Revolving Credit Agreement and the provisions of Section
2.9 thereof.

    Should all or any part of the indebtedness represented by this Note be
collected by action at law, or in bankruptcy, insolvency, receivership or other
court proceedings, or should this Note be placed in the hands of attorneys for
collection after default, the Borrower hereby promises to pay to the holder of
this Note, upon demand by the holder hereof at any time, in addition to
principal, interest and all (if any) other amounts payable on or in respect of
this Note or the indebtedness evidenced hereby, all court costs and attorneys'
fees and all other collection charges and expenses reasonably incurred or
sustained by the holder of this Note.

    The Borrower hereby irrevocably waives notice of acceptance, presentment,
notice of nonpayment, protest, notice of protest, suit and all other conditions
precedent in connection with the delivery, acceptance, collection and/or
enforcement of this Note, except for notices expressly provided for in the
Revolving Credit Agreement. The Borrower hereby absolutely and irrevocably
consents and submits to the jurisdiction of the Courts of the Commonwealth of
Massachusetts sitting in Suffolk County and of any Federal Court located in the
Eastern District of Massachusetts in connection with any actions or proceedings
brought against the Borrower by the holder hereof arising out of or relating to
this Note. This Note may be executed in any number of counterparts and by each
party on a separate counterpart, each of which when so executed and delivered
shall be an original, and all of which together shall constitute one instrument.

    This Note is intended to take effect as a sealed instrument. This Note and
the obligations of the Borrower hereunder shall be governed by and interpreted
and determined in accordance with the laws of the Commonwealth of Massachusetts.

    Each Borrower shall be jointly and severally liable for the full amount
owing under this Note.


                  [Remainder of page intentionally left blank]

                                      D-1-3


    IN WITNESS WHEREOF, this BID RATE NOTE has been duly executed by the
undersigned on the day and in the year first above written in Boston,
Massachusetts.

                                 332 HARTWELL AVENUE, LEXINGTON, MA**

                                 MBZ-LEX TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 WALTHAM OFFICE CENTER, WALTHAM, MA

                                 ZEE EM TRUST II

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

- ----------
** The designation of the specific Real Estate Asset or Assets owned by any
signatory to this Agreement or any other Loan Document is for informational
purposes only and does not in any way limit the joint and several liability of
each Borrower, for so long as it is a Borrower, for the Obligations.

                                      D-1-4


                                 204 SECOND AVENUE, WALTHAM, MA

                                 WP TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 170 TRACER LANE, WALTHAM, MA

                                 TRACER LANE TRUST II

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                      D-1-5


                                 33 HAYDEN AVENUE, LEXINGTON, MA

                                 HAYDEN OFFICE TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 92 AND 100 HAYDEN AVENUE, LEXINGTON, MA

                                 92 HAYDEN AVENUE TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                      D-1-6


                                 LEXINGTON OFFICE PARK, 420-430 BEDFORD STREET,
                                 LEXINGTON, MA

                                 ELANDZEE TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 40-46 HARVARD STREET, WESTWOOD, MA

                                 40-46 HARVARD STREET TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                      D-1-7


                                 17 HARTWELL AVENUE, LEXINGTON, MA

                                 ZEE BEE TRUST II

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 ONE CAMBRIDGE CENTER, CAMBRIDGE, MA

                                 ONE CAMBRIDGE CENTER TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                      D-1-8


                                 THREE CAMBRIDGE CENTER, CAMBRIDGE, MA

                                 THREE CAMBRIDGE CENTER TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 ELEVEN CAMBRIDGE CENTER, CAMBRIDGE, MA

                                 ELEVEN CAMBRIDGE CENTER TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                      D-1-9


                                 FOURTEEN CAMBRIDGE CENTER, CAMBRIDGE, MA

                                 FOURTEEN CAMBRIDGE CENTER TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 500 E STREET, S.W., WASHINGTON, D.C.

                                 SCHOOL STREET ASSOCIATES LIMITED PARTNERSHIP

                                 By:  Boston Properties LLC, its sole general
                                      partner

                                      By:  Boston Properties Limited
                                           Partnership, its managing member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   ----------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer

                                     D-1-10


                                 LONG WHARF MARRIOTT, BOSTON, MA

                                 DOWNTOWN BOSTON PROPERTIES TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                 CAMBRIDGE CENTER MARRIOTT, CAMBRIDGE, MA

                                 TWO CAMBRIDGE CENTER TRUST

                                 By:  Boston Properties Limited Partnership,
                                      its beneficiary

                                      By:  Boston Properties, Inc., its
                                           general partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                     D-1-11


                                 DECOVERLY TWO, ROCKVILLE, MD

                                 DECOVERLY TWO LIMITED PARTNERSHIP

                                 By:  Boston Properties LLC, its general partner

                                      By:  Boston Properties Limited
                                           Partnership, its Managing Member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   ----------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer


                                 THE CANDLER BUILDING, 111 MARKET PLACE,
                                 BALTIMORE, MD

                                 CANDLER ASSOCIATES L.L.C.

                                 By:  Boston Properties Limited Partnership,
                                      its managing member

                                      By:  Boston Properties, Inc., its general
                                           partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                     D-1-12


                                 104 CARNEGIE CENTER, PRINCETON, NJ

                                 CARNEGIE CENTER ASSOCIATES

                                 By:  Boston Properties Limited Partnership, its
                                      general partner

                                      By:  Boston Properties, Inc., its general
                                           partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 105 CARNEGIE CENTER, PRINCETON, NJ

                                 CARNEGIE CENTER ASSOCIATES

                                 By:  Boston Properties Limited Partnership, its
                                      general partner

                                      By:  Boston Properties, Inc., its general
                                           partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer

                                     D-1-13


                                 210 CARNEGIE CENTER, PRINCETON, NJ

                                 210 ASSOCIATES LIMITED PARTNERSHIP

                                 By:  Boston Properties LLC, its general partner

                                      By:  Boston Properties Limited
                                           Partnership, its managing member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   ----------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer


                                 211 CARNEGIE CENTER, PRINCETON, NJ

                                 211 ASSOCIATES LIMITED PARTNERSHIP

                                 By:  Boston Properties LLC, its general partner

                                      By:  Boston Properties Limited
                                           Partnership, its managing member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   ----------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer

                                     D-1-14


                                 CAMBRIDGE CENTER NORTH GARAGE, CAMBRIDGE, MA

                                 CAMBRIDGE CENTER NORTH TRUST

                                 By:  Boston Properties Limited Partnership, its
                                      beneficiary

                                      By:  Boston Properties, Inc., its general
                                           partner

                                           By: /s/ Douglas T. Linde
                                              ----------------------(SEAL)
                                              Douglas T. Linde
                                              Senior Vice President and
                                              Chief Financial Officer


                                 9509 KEY WEST AVENUE, DECOVERLY SEVEN,
                                 ROCKVILLE, MD

                                 DECOVERLY SEVEN LIMITED PARTNERSHIP

                                 By:  Boston Properties LLC, its general partner

                                      By:  Boston Properties Limited
                                           Partnership, its managing member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   ----------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer

                                     D-1-15


                                 ONE TOWER CENTER, EAST BRUNSWICK, NJ

                                 SCV PARTNERS

                                 By:  BP III LLC, its general partner

                                      By:  Boston Properties Limited
                                           Partnership, its managing member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   ----------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer


                                 201 CARNEGIE CENTER, PRINCETON, NJ

                                 PRINCETON CHILDCARE ASSOCIATES
                                 LIMITED PARTNERSHIP

                                 By:  Boston Properties LLC, its sole general
                                      partner

                                      By:  Boston Properties Limited
                                           Partnership, its managing member

                                           By:  Boston Properties, Inc., its
                                                general partner

                                                By: /s/ Douglas T. Linde
                                                   ----------------------(SEAL)
                                                   Douglas T. Linde
                                                   Senior Vice President and
                                                   Chief Financial Officer


                                 399 PARK AVENUE, NEW YORK, NY

                                 195 WEST STREET, WALTHAM, MA

                                 7435 BOSTON BOULEVARD, BUILDING ONE,
                                 SPRINGFIELD, VA

                                     D-1-16


                                 7451 BOSTON BOULEVARD, BUILDING TWO,
                                 SPRINGFIELD, VA

                                 7374 BOSTON BOULEVARD, BUILDING FOUR,
                                 SPRINGFIELD, VA

                                 8000 GRAINGER COURT, BUILDING FIVE,
                                 SPRINGFIELD, VA

                                 7500 BOULEVARD, BUILDING SIX,
                                 SPRINGFIELD, VA

                                 7501 BOSTON BOULEVARD, BUILDING SEVEN,
                                 SPRINGFIELD, VA

                                 7601 BOSTON BOULEVARD, BUILDING EIGHT,
                                 SPRINGFIELD, VA

                                 7375 BOSTON BOULEVARD, BUILDING TEN,
                                 SPRINGFIELD, VA

                                 7300 BOSTON BOULEVARD, BUILDING THIRTEEN,
                                 SPRINGFIELD, VA

                                 8000 CORPORATE COURT, BUILDING ELEVEN,
                                 SPRINGFIELD, VA

                                 38 CABOT BOULEVARD, BUCKS COUNTY, PA

                                 365 HERNDON PARKWAY (SUGARLAND I),
                                 HERNDON, VA

                                 397 HERNDON PARKWAY (SUGARLAND II),
                                 HERNDON, VA

                                 164 LEXINGTON ROAD, BILLERICA, MA

                                 THE ARBORETUM, 12700 SUNRISE VALLEY DRIVE,
                                 RESTON, VA

                                 502 CARNEGIE CENTER, PRINCETON, NJ

                                 RESIDENCE INN, CAMBRIDGE, MA

                                     D-1-17


                                 212 CARNEGIE CENTER, PRINCETON, NJ

                                 NEWPORT OFFICE CENTER, QUINCY, MA

                                 ORBITAL SCIENCES - PHASE I, DULLES, VA

                                 DECOVERLY THREE, 15204 OMEGA DRIVE, ROCKVILLE,
                                 MD

                                 7450 BOSTON BOULEVARD, BUILDING THREE,
                                 SPRINGFIELD, VA

                                 200 WEST STREET, WALTHAM, MA

                                 Broad Run Business Park Building E,
                                 MORAN ROAD, LEESBURG VA 20175

                                 BOSTON PROPERTIES LIMITED PARTNERSHIP


                                 By:  Boston Properties, Inc., its sole general
                                      partner

                                      By: /s/ Douglas T. Linde
                                         ------------------------(SEAL)
                                         Douglas T. Linde
                                         Senior Vice President and
                                         Chief Financial Officer

                                     D-1-18


                                                                     EXHIBIT D-2

                    FORM OF BID RATE ADVANCE BORROWING NOTICE

                                                           [Date]

To:           Fleet National Bank, as Managing Administrative Agent (the
              "Agent")

From:         Boston Properties Limited Partnership and each other Borrower
              under the Credit Agreement referred to below (collectively, the
              "Borrower")

Re:           Third Amended and Restated Revolving Credit Agreement (as amended,
              the "Credit Agreement") dated as of January __, 2003 among the
              Borrower, the Banks party thereto and the Agent.

    We hereby give notice pursuant to Section 2.9(b)(i) of the Credit Agreement
that we jointly and severally request a Bid Rate Advance as follows:

    1.    The Business Day of the proposed Bid Rate Advance is: ______________,
200_.* -

    2.    This request is for an [Absolute Rate Auction in which the rates of
interest to be offered by the Banks shall be absolute rates per annum] [Indexed
Rate Auction in which the rates of interest to be offered by the Banks shall be
rates per annum at a margin greater or less than the Eurodollar Rate plus the
Applicable Eurodollar Margin].

    3.    The terms of the Bid Rate Advance requested are as follows:



          Principal Amount**       Interest Period***          Maturity Date****
          ----------------         ---------------             -------------
                                                         
          $


          [repeat as necessary]

    4.    [Insert special terms, if any]

                                      D-2-1


    The undersigned hereby certifies that the following statements are true on
the date hereof, and will be true on the date of the proposed Bid Rate
Borrowing, both before and after giving effect thereto and to the application of
the proceeds therefrom:

    (a)   the aggregate outstanding principal amount of the Revolving Credit
Loans, PLUS the aggregate principal amount of all Bid Rate Loans outstanding,
PLUS the aggregate principal amount of all Swingline Loans outstanding, PLUS the
Maximum Drawing Amount and, without double-counting the portion, if any, of any
Letter of Credit which is drawn and included in the Revolving Credit Loans, all
outstanding Reimbursement Obligations, on today's date excluding the requested
Bid Rate Advance is $__________ and including the requested Bid Rate Advance is
$___________,

    (b)   we will use the proceeds of the requested Bid Rate Loan in accordance
with the provisions of the Credit Agreement,

    (c)   attached hereto is a Compliance Certificate of the Borrower,
substantially in the form of Exhibit C-1 to the Credit Agreement, with
appropriate attachments,

    (d)   no Default or Event of Default has occurred and is continuing or will
result from the making of the requested Bid Rate Advance.

    Terms used herein have the meanings assigned to them in the Credit
Agreement.

                                 BOSTON PROPERTIES LIMITED
                                 PARTNERSHIP,
                                 for itself and as agent for each other Borrower

                                 By:  Boston Properties, Inc., its general
                                      partner

                                      By:
                                         ----------------------------
                                         Title:

*    Subject to notice requirements of Section 2.9(b)

**   Amount must be a minimum of $5,000,000 or any larger multiple of $1,000,000

***  1 to 180 days for Absolute Rate Auction
     7 to 180 days for Indexed Rate Auction

**** Must be on or before Maturity Date


                                      D-2-2


                                                                     EXHIBIT D-3

                             OFFER OF BID RATE LOAN
                             COMPETITIVE BID NOTICE

FLEET NATIONAL BANK, as Managing Administrative Agent
115 Perimeter Center Place
Suite 500
Atlanta, GA  30346

Attention:  Jeffrey Aycock

Re:       Bid Rate Loan Offer to Boston Properties Limited Partnership and each
          other Borrower under (and as defined in) the Third Amended and
          Restated Revolving Credit Agreement dated as of January __, 2003 (as
          amended, the "CREDIT AGREEMENT")

    In response to the Borrower's Bid Rate Advance Borrowing Notice dated
________, 200_, we hereby make the following Bid Rate Loan offer on the
following terms:

    1.    Offering Bank:___________________

    2.    Person to contact at Offering Bank:_________________

    3.    Business Day of Borrowing: * ---------------------------------

    4.    We hereby offer to make Bid Rate Loan(s) in the following principal
          amounts, for the following periods and at the following rates:



Minimum         Maximum
Principal       Principal    Applicable    Competitive         Maturity
 Amount**       Amount**     Period***     Bid Rate****          Date
- ---------       ---------    ----------    ------------        --------
                                                   
$               $


[repeat as necessary]

    We understand and agree that the offer(s) set forth above, subject to the
satisfaction of the applicable conditions set forth in the Credit Agreement,
irrevocably obligates us to

                                      D-3-1


make the Bid Rate Loan(s) for which any offer(s) are accepted in whole or in
part by the Borrower.

    Terms used herein have the meanings assigned thereto in the Credit
Agreement.

                                                Very truly yours,

                                                [NAME OF BANK]


Dated:                                          By:
      ------------                                 --------------------
                                                   Authorized Officer


*   As specified in the related Borrowing Notice.

**  Principal amount offer for each period may not exceed principal amount
    requested. Offers must be made for $5,000,000 or any larger multiple of
    $1,000,000.

*** 1 to 180 days, as specified in the related Borrowing Notice. 7 to 180 days,
    as specified in the related Borrowing Notice.

**** Specify rate of interest per annum (each rounded to the nearest 1/10,000th
     of 1%), and indicate whether it is an absolute rate or indexed rate.

                                      D-3-1


                                                                     EXHIBIT D-4

                   FORM OF NOTICE OF BID RATE LOAN ACCEPTANCE

    Re: Third Amended and Restated Revolving Credit Agreement (as amended, the
"Credit Agreement"), dated as of January __, 2003, among BOSTON PROPERTIES
LIMITED PARTNERSHIP and each other Borrower defined therein (collectively, the
"Borrower"), the lenders which are or may become parties thereto, and Fleet
National BANK AS MANAGING ADMINISTRATIVE AGENT.

    We hereby give notice pursuant to Section 2.9(b)(iii) of the Credit
Agreement of our acceptance of the following Bid Rate Loan offer(s):

    1.    Bank:_____________________

    2.    Drawdown Date*:_______________

    3.    In the following principal amounts, for the following periods and at
          the following rates:



    Principal                                           Bid Rate Loan
    Amount                    Period(s)                 Interest Rate(s)**
    ------                    ---------                 ------------------
                                                  
    $____________
    $____________


    [Repeat 1, 2 and 3 for each Bank as necessary]

    4.    The aggregate principal amount for each identical period is:



                                                                   Aggregate
          Period                                              Principal Amount
          ------                                              ----------------
                                                                  
                                                                     $
                                                                     $



     We hereby certify (a) that we will use the proceeds of the requested Bid
Rate Loans in accordance with the provisions of the Credit Agreement, (b) to the
best knowledge and belief of the Chief Financial Officer/Treasurer, both before
and after giving effect to the

                                      D-4-1


requested Bid Rate Loans (1) no Default or Event of Default exists on the date
hereof or will exist under the Credit Agreement or any other Loan Document on
the drawdown date of such Loans and (2) after taking into account such requested
Bid Rate Loans, no Default or Event of Default will exist as of the drawdown
date of such Loans, (c) to the best knowledge and belief of the Chief Financial
Officer/Treasurer, each of the representations and warranties of the Borrower
contained in the Credit Agreement, the other Loan Documents or in any document
or instrument delivered pursuant to or in connection with the Credit Agreement
was true as of the date as of which they were made and is also true at and as of
the date hereof and will be true at and as of the time of the making of the
requested Bid Rate Loans, with the same effect as if made at and as of that time
except to the extent that such representations and warranties relate expressly
to an earlier date, and (d) that the undersigned is authorized to execute and
deliver this certificate on behalf of each Borrower.

     Capitalized terms which are used herein without definition and which are
defined in the Credit Agreement shall have the same meanings herein as in the
Credit Agreement.

                               Very truly yours,

                                 BOSTON PROPERTIES LIMITED
                                 PARTNERSHIP,
                                 for itself and as agent for each other Borrower


                                 By:  Boston Properties, Inc., its general
                                      partner

                                      By:
                                         -----------------------------
                                         Title:

*  As specified in the related Borrowing Notice

** Specify rate of interest per annum (each rounded to the nearest 1/1,000th of
   1%) for each applicable period.

                                      D-4-1


                                                                       EXHIBIT E

                      BOSTON PROPERTIES LIMITED PARTNERSHIP

                                                                January __, 2003

Fleet National Bank
       individually and as Agent, and the other
       Banks party to the Credit Agreement described below
115 Perimeter Center Place, Suite 500
Atlanta, GA 30346

Attention:   Robert C. Avil, Vice President

       RE:   Closing Certificate under Third Amended and Restated Revolving
             Credit Agreement dated as of January __, 2003 (the "Credit
             Agreement")

Ladies and Gentleman:

     The undersigned hereby certifies to you, in accordance with the provisions
of Section 12.19 of the Credit Agreement, that the representations and
warranties of the undersigned contained in the Credit Agreement and in each
document and instrument executed and delivered by the undersigned pursuant to or
in connection therewith are true as of the date hereof and that each Borrower
has performed and complied with all covenants and other obligations required to
be performed or complied with by it on or prior to the Closing Date (except as
any of the foregoing may have been waived or deferred in writing by the Agent
and the Banks) and that no Default or Event of Default has occurred and is
continuing on the date hereof.

     Unless otherwise defined herein, the terms used in this Closing Certificate
have the meanings described in the Credit Agreement.

                                                        Very truly yours,

                                      BOSTON PROPERTIES LIMITED
                                      PARTNERSHIP, for itself and as agent for
                                      each other Borrower

                                      By:  Boston Properties, Inc.

                                           By:
                                              ------------------------------
                                              Title:

                                       E-1


                                       E-2



                                                                       EXHIBIT F

                                     FORM OF
                       ASSIGNMENT AND ASSUMPTION AGREEMENT

                               Dated ____________

    Reference is made to the Third Amended and Restated Revolving Credit
Agreement, dated as of January __, 2003 (as amended and in effect from time to
time, the "Agreement"), among Boston Properties Limited Partnership (the
"Borrower"), the banking institutions referred to therein as Banks (the
"Banks"), and Fleet National Bank, as agent (the "Agent") for the Banks.
Capitalized terms used herein and not otherwise defined shall have the meanings
assigned to such terms in the Agreement.

     __________________________________________ (the "Assignor") and
________________________________________________ (the "Assignee") agree as
follows:

    1.    The Assignor hereby sells and assigns to the Assignee, and the
Assignee hereby purchases and assumes from the Assignor, a _% interest in and to
all of the Assignor's rights and obligations under the Agreement as of the
Effective Date, (as hereinafter defined).

    2.    The Assignor (i) represents that as of the date hereof, its Commitment
Percentage (without giving effect to assignments thereof which have not yet
become effective) is _%, the outstanding balance of its Loans (unreduced by any
assignments thereof which have not yet become effective) is $__________ and the
aggregate amount of its Letter of Credit Participations (unreduced by any
assignments thereof which have not yet become effective) is $_______; (ii) makes
no representation or warranty and assumes no responsibility with respect to any
statements, warranties or re representations made in or in connection with the
Agreement, the other Loan Documents or any other instrument or document
furnished pursuant thereto or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Agreement, the other Loan Documents or
any other instrument or document furnished pursuant thereto, other than that it
is the legal and beneficial owner of the interest being assigned by it hereunder
and that such interest is free and clear of any adverse claim; (iii) makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of the Borrower or any of its Subsidiaries or subsidiaries
(as defined in the Agreement) or any other person which may be primarily or
secondarily liable in respect of any of the Obligations under the Agreement or
the other Loan Documents or any other instrument or document delivered or
executed pursuant thereto; [and (iv) represents that as of the date hereof there
are no Letters of Credit outstanding].

                                       F-1


    3.    The Assignee (i) represents and warrants that it is legally authorized
to enter into this Assignment and Assumption; (ii) confirms that it has received
a copy of the Agreement, together with copies of the most recent financial
statements delivered pursuant to Section Section 7.4 and 8.4 thereof, if any,
and such other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into this Assignment and
Assumption; (iii) agrees that it will, independently and without reliance upon
the Assignor, any other Bank or the Agent and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under the Agreement; (iv)
confirms that it is an Eligible Assignee; (v) appoints and authorizes the Agent,
and each other Bank who may from time to time be designated as an agent in a
limited specific capacity pursuant to an amendment to the Agreement, to take
such action as agent (and with respect to such other Banks, in such limited
capacity as may be designated) on its behalf and to exercise such powers as are
reasonably incidental thereto pursuant to the terms of the Agreement and the
other Loan Documents; and (vi) agrees that it will perform all the obligations
which by the terms of the Agreement are required to be performed by it as a Bank
in accordance with the terms of the Agreement. The Assignor represents and
warrants that it is legally authorized to enter into this Assignment and
Assumption.

    4.    The effective date for this Assignment and Assumption shall be
____________, 20__ (the "Effective Date"). Following the execution of this
Assignment and Assumption, it will be delivered to the Agent for recording in
the Register by the Agent.

    5.    Upon such acceptance and recording, from and after the Effective Date,
and, in accordance with Section 20.1 of the Agreement, the Agent and the
Borrower shall have approved (or be deemed to have approved) the herein
assignment pursuant to Section 20.1 of the Agreement, and the Assignor shall,
with respect to that portion of its interest under the Agreement assigned
hereunder, relinquish its rights and be released from its obligations under the
Agreement accruing from and after the Effective Date.

    6.    Upon such acceptance and recording, from and after the Effective Date,
the Agent shall make all payments in respect of the interest assigned hereby
(including payments of principal, interest, fees and other amounts) to the
Assignee. The Assignor and Assignee shall make all appropriate adjustments in
payments for periods prior to the Effective Date by the Agent or with respect to
the making of this assignment directly between themselves.

    7.    THIS ASSIGNMENT AND ASSUMPTION SHALL RUN TO THE BENEFIT OF THE
BORROWER, IN ACCORDANCE WITH Section 20.1 OF THE AGREEMENT. THIS ASSIGNMENT AND
ASSUMPTION IS INTENDED TO TAKE EFFECT AS A SEALED INSTRUMENT TO BE GOVERNED BY,
AND

                                       F-2


CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS.

    IN WITNESS WHEREOF, intending to be legally bound, each of the undersigned
has caused this Assignment and Assumption to be executed on its behalf by its
officer thereunto duly authorized, as of the date first above written.

                                           [NAME OF ASSIGNOR]


                                           By:
                                              -------------------------------
                                              Title:
                                                    -------------------------

                                           [NAME OF ASSIGNEE]

                                           By:
                                              -------------------------------
                                              Title:
                                                    -------------------------

                                       F-3


                                                                       EXHIBIT G

                            FORM OF JOINDER AGREEMENT

                                                                 _________, 20__

    Reference is made to the Third Amended and Restated Revolving Credit
Agreement, dated as of January __, 2003 (as from time to time amended and in
effect, the "Loan Agreement"), among Boston Properties Limited Partnership,
those other Borrowers listed on Schedule 1 of the Loan Agreement and each other
Borrower (collectively, the "Borrower") which from time to time is a party to
the Loan Agreement, the banking institutions referred to the Loan Agreement as
Banks (collectively, the "Banks"), and Fleet National Bank, as Agent (the
"Agent") for the Banks. Capitalized terms used herein and not otherwise defined
shall have the meanings assigned to such in the Agreement.

    In consideration of and as an inducement to the inclusion of the
Unencumbered Asset identified on EXHIBIT A hereto as a Borrowing Base Property
(the "Additional Borrowing Base Property") by the Banks, __________________ (the
"Additional Borrower"), a_____________________, which is a Wholly-owned
Subsidiary of BPLP, hereby acknowledges and agrees to the terms and conditions
of the Loan Agreement, the Revolving Credit Notes and the other Loan Documents
to which any Borrower is a party, joins in the agreements of the Borrower under
the Loan Agreement, the Revolving Credit Notes and the other Loan Documents to
which any Borrower is a party and agrees that all Obligations of the Borrower
under the Loan Agreement, the Revolving Credit Notes and the other Loan
Documents to which any Borrower is a party shall be the obligations, jointly and
severally, of the Additional Borrower with the same force and effect as if the
Additional Borrower was originally a Borrower under the Loan Agreement and an
original signatory to the Loan Agreement, the Revolving Credit Notes and the
other Loan Documents to which any Borrower is a party.

    The Additional Borrower further agrees that its liability hereunder is
direct and primary and may be enforced by the Banks and the Agent before or
after proceeding against any other Borrower.

    At least five (5) Business Days prior to this Joinder Agreement becoming
effective and the Unencumbered Asset identified in EXHIBIT A hereto becoming a
Borrowing Base Property, the Additional Borrower shall have delivered to the
Agent (with copies to the Agent for each Bank) those documents referred to in
Sections 12.3 through 12.9, 12.12. 12.13, 12.15, 12.17, 12.19, 12.20 and 12.21
of the Loan Agreement

                                       G-1


with respect to the Additional Borrower, in each case in form and substance
materially the same as those documents delivered by the Borrower on the Closing
Date. The Additional Borrower agrees that the Agent shall have the right to
visit and inspect the Additional Borrowing Base Property at the Borrower's sole
cost and expense.

    The undersigned represents and warrants to the Agent and the Banks that it
has the complete right, power and authority to execute and deliver this Joinder
Agreement and to perform all of the obligations hereunder and the Obligations
under the Loan Agreement, the Revolving Credit Notes and the other Loan
Documents to which any Borrower is a party. This Joinder Agreement shall be
binding upon the undersigned and its successors and assigns and shall inure to
the benefit of the Banks, the Agent and their respective successors and assigns.

    Executed as a sealed instrument as of the _______ day of ___________, 2000.

                                           [ADDITIONAL BORROWER]

                                           -------------------------------------

                                           Name:
                                                  ------------------------------

                                           Title:
                                                  ------------------------------
ACKNOWLEDGED AND AGREED:

BOSTON PROPERTIES LIMITED PARTNERSHIP,
individually and as agent for each Borrower

By:   Boston Properties, Inc., its sole general partner

      By:  /s/ Douglas T. Linde
          -------------------------(SEAL)
          Douglas T. Linde
          Chief Financial Officer

                                       G-2


                         EXHIBIT A TO JOINDER AGREEMENT

                       Additional Borrowing Base Property



** The designation of the specific Real Estate Asset or Assets owned by any
signatory to this Agreement or any other Loan Document is for informational
purposes only and does not in any way limit the joint and several liability of
each Borrower, for so long as it is a Borrower, for the Obligations.

                                      G-3



                                                                    EXHIBIT 21.1



             SUBSIDIARY                          STATE OF INCORPORATION/ORGANIZATION
             ----------                          -----------------------------------
                                                           
No. 1 Times Square Development LLC                            Delaware
No. 5 Times Square Development LLC                            Delaware
17M Acquisition Subsidiary LLC                                Delaware
17M Associates                                                District of Columbia
30 Shattuck Road LLC                                          Delaware
40-46 Harvard Street Trust                                    Massachusetts
90 Church Street Limited Partnership                          Delaware
91 Hartwell Avenue Trust                                      Massachusetts
92 Hayden Avenue Trust                                        Massachusetts
101 Carnegie Center Associates                                New Jersey
191 Spring Street Trust                                       Massachusetts
206 Associates Limited Partnership                            New Jersey
210 Associates Limited Partnership                            New Jersey
211 Associates Limited Partnership                            New Jersey
500 Series LLC                                                Delaware
Big Apple Associates Limited Partnership                      Delaware
Boston Properties, Inc.                                       Delaware
Boston Properties Limited Partnership                         Delaware
Boston Properties LLC                                         Delaware
Boston Properties Management, Inc.                            Delaware
Boston Properties TRS Inc.                                    Delaware
BP 8th Avenue Associates LLC                                  Delaware
BP 20 F Street Limited Partnership                            Delaware
BP 45th Associates LLC                                        Delaware
BP 111 Huntington Ave LLC                                     Delaware
BP 140 Kendrick Street LLC                                    Delaware
BP 140 Kendrick Street Property LLC                           Delaware
BP 201 Spring Street LLC                                      Delaware
BP 280 Park Avenue LLC                                        Delaware
BP 280 Park Avenue Manager Corp.                              Delaware
BP 280 Park Avenue Mezzanine LLC                              Delaware
BP 399 Park Avenue LLC                                        Delaware
BP II LLC                                                     Delaware
BP III LLC                                                    Delaware
BP Almaden Associates LLC                                     Delaware
BP Belvidere LLC                                              Delaware
BP Boylston Residential LLC                                   Delaware
BP/CGCenter Acquisition Co. LLC                               Delaware
BP/CGCenter I LLC                                             Delaware
BP/CGCenter II LLC                                            Delaware
BP/CGCenter MM LLC                                            Delaware
BP/CGCenter MM2 LLC                                           Delaware
BP/CG Member I LLC                                            Delaware
BP/CG Member II LLC                                           Delaware
BP/CG Member III LLC                                          Delaware
BP Crane Meadow L.L.C                                         Delaware
BP/CRF 265 Franklin Street LLC                                Delaware
BP/CRF 265 Franklin Street Holdings LLC                       Delaware
BP/CRF 265 Franklin Street Manager Corp.                      Delaware
BP/CRF 265 Franklin Street Mezzanine LLC                      Delaware
BP/CRF 901 New York Avenue LLC                                Delaware
BP EC1 Holdings LLC                                           Delaware





                                                           
BP EC2 Holdings LLC                                           Delaware
BP EC3 Holdings LLC                                           Delaware
BP EC4 Holdings LLC                                           Delaware
BP EC West LLC                                                Delaware
BP Fourth Avenue L.L.C                                        Delaware
BP Gateway Center LLC                                         Delaware
BP Hotel LLC                                                  Delaware
BP Lending LLC                                                Delaware
BP Lex LLC                                                    Delaware
BP Management LP                                              Delaware
BP OFR LLC                                                    Delaware
BP Prucenter Acquisition LLC                                  Delaware
BP Prucenter Development LLC                                  Delaware
BP Realty New Jersey LLC                                      New Jersey
BP Reston Eastgate LLC                                        Delaware
BP Supermarket LLC                                            Delaware
BP Weston Quarry LLC                                          Delaware
Broad Run Business Center Property Association                Virginia
Cambridge Center North Trust                                  Massachusetts
Cambridge Center West Associates Limited Partnership          Massachusetts
Cambridge Center West Trust                                   Massachusetts
Cambridge Group LLC                                           Delaware
Candler Associates L.L.C.                                     Maryland
Carnegie 214 Associates Limited Partnership                   New Jersey
Carnegie 504 Associates                                       New Jersey
Carnegie 506 Associates                                       New Jersey
Carnegie 508 Associates                                       New Jersey
Carnegie 510 Associates L.L.C.                                Delaware
Carnegie Center Associates                                    New Jersey
CRF Met Square LLC                                            Delaware
Decoverly Two Limited Partnership                             Maryland
Decoverly Four Limited Partnership                            Maryland
Decoverly Five Limited Partnership                            Maryland
Decoverly Six Limited Partnership                             Maryland
Decoverly Seven Limited Partnership                           Maryland
Democracy Associates Limited Partnership                      Maryland
Democracy Financing LLC                                       Delaware
Discovery Square L.L.C.                                       Delaware
Downtown Boston Properties Trust                              Massachusetts
East Pratt Street Associates Limited Partnership              Maryland
Elandzee Trust                                                Massachusetts
Eleven Cambridge Center Trust                                 Massachusetts
Embarcadero Center Associates                                 California
Embarcadero Center, Inc.                                      California
Four Embarcadero Center Venture                               California
Fourteen Cambridge Center Trust                               Massachusetts
Gateway Center LLC                                            Delaware
Hayden Office Trust                                           Massachusetts
IPX Inc.                                                      Vermont
Jones Road Development Associates LLC                         Delaware
Lexreal Associates Limited Partnership                        New York
LKE BP Fourth Avenue Limited Partnership                      Massachusetts
Mall Road Trust                                               Massachusetts
Market Square North Associates Limited Partnership            Delaware
MBZ-Lex Trust                                                 Massachusetts





                                                           
MGA Virginia 85-1 Limited Partnership                         Virginia
MGA Virginia 86-1 Limited Partnership                         Virginia
MGA Virginia 86-2 Limited Partnership                         Virginia
Montgomery Village Avenue Joint Venture Limited               Maryland
   Partnership
New Dominion Technology Corp.                                 Delaware
New Dominion Technology Park LLC                              Delaware
New Dominion Technology Park II LLC                           Delaware
Ocean View Development Company Limited Partnership            District of Columbia
One Cambridge Center Trust                                    Massachusetts
One Embarcadero Center Venture                                California
One Freedom Square, L.L.C.                                    Delaware
Pratt Street Financing, LLC                                   Delaware
Princeton 202 Associates Limited Partnership                  New Jersey
Princeton Childcare Associates Limited Partnership            New Jersey
Reston Corporate Center Limited Partnership                   Virginia
Reston Town Center Office Park Phase One Limited              Virginia
   Partnership
Reston VA 939, LLC                                            Delaware
School Street Associates Limited Partnership                  District of Columbia
SCV Partners                                                  New Jersey
Skyline Holdings LLC                                          Delaware
Southwest Market Limited Partnership                          District of Columbia
Square 36 Office Joint Venture                                District of Columbia
Square 407 Limited Partnership                                District of Columbia
Stony Brook Associates LLC                                    Delaware
Ten Cambridge Center Trust                                    Massachusetts
The Double B Partnership                                      Massachusetts
The Metropolitan Square Associates LLC                        District of Columbia
Three Cambridge Center Trust                                  Massachusetts
Three Embarcadero Center Venture                              California
Tower Oaks Financing LLC                                      Delaware
Tracer Lane Trust II                                          Massachusetts
Two Cambridge Center Trust                                    Massachusetts
Two Freedom Square L.L.C.                                     Delaware
Washingtonian North Associates Limited Partnership            Maryland
Zee Bee Trust II                                              Massachusetts
Zee Em Trust II                                               Massachusetts
ZL Hotel Corp.                                                Massachusetts
ZL Hotel LLC                                                  Delaware




                                                                    Exhibit 23.1


                  CONSENT OF INDEPENDENT ACCOUNTANTS


We hereby consent to the incorporation by reference in the Registration
Statements of Boston Properties, Inc. on Forms S-3 (File Numbers, 333-101255,
333-92402, 333-36142, 333-39114, 333-40618, 333-51024, 333-58694, 333-60219,
333-61799, 333-64902, 333-68379, 333-69375, 333-70765, 333-80513, 333-81355,
333-82498, 333-83859, 333-83861, 333-83863, 333-83867, 333-83869, 333-86585, and
333-91425) and on Forms S-8 (File Numbers 333-52845, 333-54550, 333-70321, and
333-81824) of our report dated February 21, 2003, relating to the financial
statements and financial statement schedule, which appears in this Form 10-K.


/s/ PricewaterhouseCoopers LLP
Boston, Massachusetts
February 26, 2003