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Boston Properties Inc.’s BXP fourth-quarter 2024 funds from operations (FFO) per share of $1.79 was in line with the Zacks Consensus Estimate. However, the reported figure fell 1.6% year over year.
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BXP’s quarterly results reflect better-than-anticipated revenues on healthy leasing activity. However, higher interest expenses during the quarter marred its year-over-year FFO per share growth. BXP also issued its guidance for 2025 FFO per share.
Quarterly lease revenues were $798.2 million, up 3.8% year over year. The Zacks Consensus Estimate was pegged at $795.3 million. Total revenues increased 3.6% from the prior-year quarter to $858.6 million.
For 2024, Boston Properties reported an FFO per share of $7.10, which met the Zacks Consensus Estimate. The figure compared unfavorably with the prior year’s $7.28. Lease revenues of $3.18 billion increased 4% year over year.
BXP’s Fourth Quarter in Detail
Boston Properties’ rental revenues (excluding termination income) for the office portfolio came in at $777.4 million, which rose 0.9% year over year. For the hotel & residential segment, the metric aggregated $25.6 million, indicating a jump of 8.5% year over year. On a consolidated basis, BXP’s rental revenues (excluding termination income) came in at $803 million, up 1.2% year over year.
BXP’s share of the same property net operating income (NOI) on a cash basis (excluding termination income) totaled $447.2 million, which increased 0.9% from the prior-year quarter.
Its share of EBITDAre (on a cash basis), as of Dec. 31, 2024, was $476.4 million, up 1.4% from $469.8 million as of Sept. 30, 2024.
BXP’s in-service properties occupancy increased 50 basis points sequentially to 87.5%. We estimated the metric to be 87.3%.
BXP’s quarterly interest expenses were up 9.9% year over year to $170.4 million.
BXP’s Portfolio Activity
As of Dec. 31, 2024, Boston Properties’ portfolio comprised 185 properties encompassing 53.3 million square feet of space. This included seven properties under construction/redevelopment.
During the fourth quarter, the company executed 83 leases spanning more than 2.3 million square feet, with a weighted average lease term of 10.3 years.
In December, BXP acquired 725 12th Street property encompassing 300,000 square feet of space in Washington, DC, for a gross purchase price of $34 million. The company plans to undertake the demolition and redevelopment of the property, transforming it into a premier workplace of approximately 320,000 square feet.