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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended March 31,September 30, 2021
or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from             to             
Commission File Number: 1-13087 (Boston Properties, Inc.)
Commission File Number: 0-50209 (Boston Properties Limited Partnership)
BOSTON PROPERTIES, INC.
BOSTON PROPERTIES LIMITED PARTNERSHIP
(Exact name of Registrants as specified in its charter)
Boston Properties, Inc.Delaware04-2473675
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification Number)
Boston Properties Limited PartnershipDelaware04-3372948
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification Number)
Prudential Center, 800 Boylston Street, Suite 1900, Boston, Massachusetts 02199-8103
(Address of principal executive offices) (Zip Code)
(617) 236-3300
(Registrants’ telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
RegistrantTitle of each classTrading Symbol(s)Name of each exchange on which registered
Boston Properties, Inc.Common Stock, par value $0.01 per shareBXPNew York Stock Exchange
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.  
Boston Properties, Inc.:    Yes  x   No           Boston Properties Limited Partnership:    Yes  x    No      


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Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    
Boston Properties, Inc.:    Yes  x    No           Boston Properties Limited Partnership:    Yes  x    No      
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Boston Properties, Inc.:    
Large accelerated filer  x         Accelerated filer           Non-accelerated filer           Smaller reporting company           Emerging growth company  

Boston Properties Limited Partnership:
Large accelerated filer           Accelerated filer           Non-accelerated filer  x           Smaller reporting company             Emerging growth company  
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Boston Properties, Inc.                  Boston Properties Limited Partnership 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    
Boston Properties, Inc.:    Yes      No  x        Boston Properties Limited Partnership:    Yes      No  x
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
Boston Properties, Inc.Common Stock, par value $0.01 per share156,074,252156,206,944
(Registrant)(Class)(Outstanding on May 3,November 2, 2021)


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EXPLANATORY NOTE
This report combines the Quarterly Reports on Form 10-Q for the period ended March 31,September 30, 2021 of Boston Properties, Inc. and Boston Properties Limited Partnership. Unless stated otherwise or the context otherwise requires, references to “BXP” mean Boston Properties, Inc., a Delaware corporation and real estate investment trust (“REIT”), and references to “BPLP” and the “Operating Partnership” mean Boston Properties Limited Partnership, a Delaware limited partnership. BPLP is the entity through which BXP conducts substantially all of its business and owns, either directly or through subsidiaries, substantially all of its assets. BXP is the sole general partner and also a limited partner of BPLP. As the sole general partner of BPLP, BXP has exclusive control of BPLP’s day-to-day management. Therefore, unless stated otherwise or the context requires, references to the “Company,” “we,” “us” and “our” mean collectively BXP, BPLP and those entities/subsidiaries consolidated by BXP.
As of March 31,September 30, 2021, BXP owned an approximate 89.9% ownership interest in BPLP. The remaining approximate 10.1% interest was owned by limited partners. The other limited partners of BPLP are (1) persons who contributed their direct or indirect interests in properties to BPLP in exchange for common units or preferred units of limited partnership interest in BPLP and/or (2) recipients of long-term incentive plan units of BPLP pursuant to BXP’s Stock Option and Incentive Plans. Under the limited partnership agreement of BPLP, unitholders may present their common units of BPLP for redemption at any time (subject to restrictions agreed upon at the time of issuance of the units that may restrict such right for a period of time, generally one year from issuance). Upon presentation of a common unit for redemption, BPLP must redeem the unit for cash equal to the then value of a share of BXP’s common stock. In lieu of a cash redemption by BPLP, however, BXP may elect to acquire any common units so tendered by issuing shares of BXP common stock in exchange for the common units. If BXP so elects, its 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. BXP generally expects that it will elect to issue its common stock in connection with each such presentation for redemption rather than having BPLP pay cash. With each such exchange or redemption, BXP’s percentage ownership in BPLP will increase. In addition, whenever BXP issues shares of its common stock other than to acquire common units of BPLP, BXP must contribute any net proceeds it receives to BPLP and BPLP must issue to BXP an equivalent number of common units of BPLP. This structure is commonly referred to as an umbrella partnership REIT, or UPREIT.
The Company believes that combining the Quarterly Reports on Form 10-Q of BXP and BPLP into this single report provides the following benefits:report:
enhances investors’ understanding of BXP and BPLP by enabling investorsthem to view the business as a whole in the same manner as management views and operates the business;
eliminates duplicative disclosure and provides a more concise and readable presentation because a substantial portion of the disclosure applies to both BXP and BPLP; and
creates time and cost efficiencies through the preparation of one combined report instead of two separate reports.
The Company believes it is important to understand the few differences between BXP and BPLP in the context of how BXP and BPLP operate as a consolidated company. The financial results of BPLP are consolidated into the financial statements of BXP. BXP does not have any other significant assets, liabilities or operations, other than its investment in BPLP, nor does it have employees of its own. BPLP, not BXP, generally executes all significant business relationships other than transactions involving the securities of BXP. BPLP holds substantially all of the assets of BXP, including ownership interests in joint ventures. BPLP conducts the operations of the business and is structured as a partnership with no publicly traded equity. Except for the net proceeds from equity offerings by BXP, which are contributed to the capital of BPLP in exchange for common or preferred units of partnership in BPLP, as applicable, BPLP generates all remaining capital required by the Company’s business. These sources include working capital, net cash provided by operating activities, borrowings under its credit facilities, the issuance of secured and unsecured debt and equity securities and proceeds received from the disposition of certain properties and interests in joint ventures.
Equity, partners’ capital and noncontrolling interests are the main areas of difference between the consolidated financial statements of BXP and BPLP. The limited partners of BPLP are accounted for as partners’ capital in BPLP’s financial statements and as noncontrolling interests in BXP’s financial statements. The noncontrolling interests in BPLP’s financial statements include the interests of unaffiliated partners in various consolidated partnerships. The noncontrolling interests in BXP’s financial statements include the same noncontrolling interests atin


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BPLP’s levelBPLP and limited partners of BPLP. The differences between shareholders’ equity and partners’ capital result from differences in the equity issued at BXP and BPLP levels.
In addition, the consolidated financial statements of BXP and BPLP differ in total real estate assets resulting from previously applied acquisition accounting by BXP for the issuance of common stock in connection with non-sponsor redemptions of common units of BPLP. This accounting resulted in a step-up of the real estate assets of BXP at BXP.the time of such redemptions. This resulted in a difference between the net real estate of BXP as compared to BPLP of approximately $268.2$264.7 million, or 1.5% at March 31,September 30, 2021, and a corresponding difference in depreciation expense, impairment losses and gains on sales of real estate upon the sale of certain properties having an allocation of the real estate step-up. The acquisition accounting was nullified on a prospective basis beginning in 2009 as a result of the Company’s adoption of a new accounting standard requiring any future redemptions to be accounted for solely as an equity transaction.
To help investors better understand the key differences between BXP and BPLP, certain information for BXP and BPLP in this report has been separated, as set forth below:
Item 1. Financial Statements (unaudited), which includes the following specific disclosures for BXP and BPLP:
Note 3. Real Estate;
Note 11. Stockholders’ Equity / Partners’ Capital;
Note 12. Segment Information; and
Note 13. Earnings Per Share / Common Unit
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations includes information specific to each entity, where applicable; and
Item 2. Liquidity and Capital Resources includes separate reconciliations of amounts to each entity’s financial statements, where applicable.
This report also includes separate Part I - Item 4. Controls and Procedures and Part II - Item 2. Unregistered Sales of Equity Securities and Use of Proceeds sections for each of BXP and BPLP, as well as separate Exhibits 31 and 32 certifications for each of BXP and BPLP.




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BOSTON PROPERTIES, INC. AND BOSTON PROPERTIES LIMITED PARTNERSHIP
FORM 10-Q
for the quarter ended March 31,September 30, 2021
TABLE OF CONTENTS
 Page
ITEM 1.
Boston Properties, Inc.
Boston Properties Limited Partnership
Boston Properties, Inc. and Boston Properties Limited Partnership
ITEM 2.
ITEM 3.
ITEM 4.
ITEM 1.
ITEM 1A.
ITEM 2.
ITEM 3.
ITEM 4.
ITEM 5.
ITEM 6.
 



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PART I. FINANCIAL INFORMATION
ITEM 1—Financial Statements.


BOSTON PROPERTIES, INC.
CONSOLIDATED BALANCE SHEETS
(unaudited and in thousands, except for share and par value amounts)
BOSTON PROPERTIES, INC.
CONSOLIDATED BALANCE SHEETS
(unaudited and in thousands, except for share and par value amounts)
BOSTON PROPERTIES, INC.
CONSOLIDATED BALANCE SHEETS
(unaudited and in thousands, except for share and par value amounts)
March 31,
2021
December 31,
2020
September 30,
2021
December 31,
2020
ASSETSASSETSASSETS
Real estate, at cost (amounts related to variable interest entities (“VIEs”) of $6,615,237 and $6,592,019 at March 31, 2021 and December 31, 2020, respectively)$23,156,924 $22,969,110 
Right of use assets - finance leases (amounts related to VIEs of $21,000 and $21,000 at March 31, 2021 and December 31, 2020, respectively)237,017 237,393 
Real estate, at cost (amounts related to variable interest entities (“VIEs”) of $6,688,647 and $6,592,019 at September 30, 2021 and December 31, 2020, respectively)Real estate, at cost (amounts related to variable interest entities (“VIEs”) of $6,688,647 and $6,592,019 at September 30, 2021 and December 31, 2020, respectively)$23,711,400 $22,969,110 
Right of use assets - finance leases (amounts related to VIEs of $21,000 and $21,000 at September 30, 2021 and December 31, 2020, respectively)Right of use assets - finance leases (amounts related to VIEs of $21,000 and $21,000 at September 30, 2021 and December 31, 2020, respectively)237,845 237,393 
Right of use assets - operating leasesRight of use assets - operating leases144,143 146,406 Right of use assets - operating leases170,085 146,406 
Less: accumulated depreciation (amounts related to VIEs of $(1,188,554) and $(1,158,548) at March 31, 2021 and December 31, 2020, respectively)(5,665,061)(5,534,102)
Less: accumulated depreciation (amounts related to VIEs of $(1,266,516) and $(1,158,548) at September 30, 2021 and December 31, 2020, respectively)Less: accumulated depreciation (amounts related to VIEs of $(1,266,516) and $(1,158,548) at September 30, 2021 and December 31, 2020, respectively)(5,850,397)(5,534,102)
Total real estateTotal real estate17,873,023 17,818,807 Total real estate18,268,933 17,818,807 
Cash and cash equivalents (amounts related to VIEs of $289,737 and $340,642 at March 31, 2021 and December 31, 2020, respectively)697,369 1,668,742 
Cash and cash equivalents (amounts related to VIEs of $288,186 and $340,642 at September 30, 2021 and December 31, 2020, respectively)Cash and cash equivalents (amounts related to VIEs of $288,186 and $340,642 at September 30, 2021 and December 31, 2020, respectively)1,002,728 1,668,742 
Cash held in escrowsCash held in escrows251,814 50,587 Cash held in escrows79,193 50,587 
Investments in securitiesInvestments in securities39,002 39,457 Investments in securities41,517 39,457 
Tenant and other receivables, net (amounts related to VIEs of $5,846 and $10,911 at March 31, 2021 and December 31, 2020, respectively)51,271 77,411 
Tenant and other receivables, net (amounts related to VIEs of $8,598 and $10,911 at September 30, 2021 and December 31, 2020, respectively)Tenant and other receivables, net (amounts related to VIEs of $8,598 and $10,911 at September 30, 2021 and December 31, 2020, respectively)61,269 77,411 
Related party note receivable, netRelated party note receivable, net77,640 77,552 Related party note receivable, net78,144 77,552 
Notes receivable, netNotes receivable, net18,891 18,729 Notes receivable, net19,297 18,729 
Accrued rental income, net (amounts related to VIEs of $341,772 and $336,594 at March 31, 2021 and December 31, 2020, respectively)1,145,066 1,122,502 
Deferred charges, net (amounts related to VIEs of $177,647 and $183,306 at March 31, 2021 and December 31, 2020, respectively)622,649 640,085 
Prepaid expenses and other assets (amounts related to VIEs of $45,075 and $13,137 at March 31, 2021 and December 31, 2020, respectively)129,102 33,840 
Accrued rental income, net (amounts related to VIEs of $352,291 and $336,594 at September 30, 2021 and December 31, 2020, respectively)Accrued rental income, net (amounts related to VIEs of $352,291 and $336,594 at September 30, 2021 and December 31, 2020, respectively)1,203,840 1,122,502 
Deferred charges, net (amounts related to VIEs of $174,172 and $183,306 at September 30, 2021 and December 31, 2020, respectively)Deferred charges, net (amounts related to VIEs of $174,172 and $183,306 at September 30, 2021 and December 31, 2020, respectively)622,807 640,085 
Prepaid expenses and other assets (amounts related to VIEs of $42,051 and $13,137 at September 30, 2021 and December 31, 2020, respectively)Prepaid expenses and other assets (amounts related to VIEs of $42,051 and $13,137 at September 30, 2021 and December 31, 2020, respectively)97,560 33,840 
Investments in unconsolidated joint venturesInvestments in unconsolidated joint ventures1,307,725 1,310,478 Investments in unconsolidated joint ventures1,373,522 1,310,478 
Total assetsTotal assets$22,213,552 $22,858,190 Total assets$22,848,810 $22,858,190 
LIABILITIES AND EQUITYLIABILITIES AND EQUITYLIABILITIES AND EQUITY
Liabilities:Liabilities:Liabilities:
Mortgage notes payable, net (amounts related to VIEs of $2,904,672 and $2,907,590 at March 31, 2021 and December 31, 2020, respectively)$2,904,672 $2,909,081 
Mortgage notes payable, net (amounts related to VIEs of $2,898,699 and $2,907,590 at September 30, 2021 and December 31, 2020, respectively)Mortgage notes payable, net (amounts related to VIEs of $2,898,699 and $2,907,590 at September 30, 2021 and December 31, 2020, respectively)$2,898,699 $2,909,081 
Unsecured senior notes, netUnsecured senior notes, net9,631,592 9,639,287 Unsecured senior notes, net10,479,651 9,639,287 
Unsecured line of creditUnsecured line of creditUnsecured line of credit— — 
Unsecured term loan, netUnsecured term loan, net499,390 Unsecured term loan, net— 499,390 
Lease liabilities - finance leases (amounts related to VIEs of $20,345 and $20,306 at March 31, 2021 and December 31, 2020, respectively)239,361 236,492 
Lease liabilities - finance leases (amounts related to VIEs of $20,420 and $20,306 at September 30, 2021 and December 31, 2020, respectively)Lease liabilities - finance leases (amounts related to VIEs of $20,420 and $20,306 at September 30, 2021 and December 31, 2020, respectively)243,562 236,492 
Lease liabilities - operating leasesLease liabilities - operating leases200,383 201,713 Lease liabilities - operating leases204,137 201,713 
Accounts payable and accrued expenses (amounts related to VIEs of $15,957 and $23,128 at March 31, 2021 and December 31, 2020, respectively)260,875 336,264 
Accounts payable and accrued expenses (amounts related to VIEs of $36,967 and $23,128 at September 30, 2021 and December 31, 2020, respectively)Accounts payable and accrued expenses (amounts related to VIEs of $36,967 and $23,128 at September 30, 2021 and December 31, 2020, respectively)331,687 336,264 
Dividends and distributions payableDividends and distributions payable171,003 171,082 Dividends and distributions payable169,739 171,082 
Accrued interest payableAccrued interest payable76,675 106,288 Accrued interest payable87,408 106,288 
Preferred stock redemption liability200,000 
Other liabilities (amounts related to VIEs of $141,547 and $158,805 at March 31, 2021 and December 31, 2020, respectively)399,965 412,084 
Other liabilities (amounts related to VIEs of $124,615 and $158,805 at September 30, 2021 and December 31, 2020, respectively)Other liabilities (amounts related to VIEs of $124,615 and $158,805 at September 30, 2021 and December 31, 2020, respectively)370,403 412,084 
Total liabilitiesTotal liabilities14,084,526 14,511,681 Total liabilities14,785,286 14,511,681 
Commitments and contingencies (See Note 9)Commitments and contingencies (See Note 9)Commitments and contingencies (See Note 9)
Redeemable deferred stock units— 80,989 and 72,966 units outstanding at redemption value at September 30, 2021 and December 31, 2020, respectivelyRedeemable deferred stock units— 80,989 and 72,966 units outstanding at redemption value at September 30, 2021 and December 31, 2020, respectively8,775 6,897 
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BOSTON PROPERTIES, INC.
CONSOLIDATED BALANCE SHEETS
(unaudited and in thousands, except for share and par value amounts)
BOSTON PROPERTIES, INC.
CONSOLIDATED BALANCE SHEETS
(unaudited and in thousands, except for share and par value amounts)
BOSTON PROPERTIES, INC.
CONSOLIDATED BALANCE SHEETS
(unaudited and in thousands, except for share and par value amounts)
March 31,
2021
December 31,
2020
September 30,
2021
December 31,
2020
Redeemable deferred stock units— 75,834 and 72,966 units outstanding at redemption value at March 31, 2021 and December 31, 2020, respectively7,679 6,897 
Equity:Equity:Equity:
Stockholders’ equity attributable to Boston Properties, Inc.:Stockholders’ equity attributable to Boston Properties, Inc.:Stockholders’ equity attributable to Boston Properties, Inc.:
Excess stock, $0.01 par value, 150,000,000 shares authorized, NaN issued or outstanding
Excess stock, $0.01 par value, 150,000,000 shares authorized, none issued or outstandingExcess stock, $0.01 par value, 150,000,000 shares authorized, none issued or outstanding— — 
Preferred stock, $0.01 par value, 50,000,000 shares authorized;Preferred stock, $0.01 par value, 50,000,000 shares authorized;Preferred stock, $0.01 par value, 50,000,000 shares authorized;
5.25% Series B cumulative redeemable preferred stock, $0.01 par value, liquidation preference $2,500 per share, 92,000 shares authorized, 80,000 shares issued and outstanding at December 31, 20205.25% Series B cumulative redeemable preferred stock, $0.01 par value, liquidation preference $2,500 per share, 92,000 shares authorized, 80,000 shares issued and outstanding at December 31, 2020200,000 5.25% Series B cumulative redeemable preferred stock, $0.01 par value, liquidation preference $2,500 per share, 92,000 shares authorized, 80,000 shares issued and outstanding at December 31, 2020— 200,000 
Common stock, $0.01 par value, 250,000,000 shares authorized, 156,153,100 and 155,797,725 issued and 156,074,200 and 155,718,825 outstanding at March 31, 2021 and December 31, 2020, respectively1,561 1,557 
Common stock, $0.01 par value, 250,000,000 shares authorized, 156,285,391 and 155,797,725 issued and 156,206,491 and 155,718,825 outstanding at September 30, 2021 and December 31, 2020, respectivelyCommon stock, $0.01 par value, 250,000,000 shares authorized, 156,285,391 and 155,797,725 issued and 156,206,491 and 155,718,825 outstanding at September 30, 2021 and December 31, 2020, respectively1,562 1,557 
Additional paid-in capitalAdditional paid-in capital6,392,923 6,356,791 Additional paid-in capital6,415,802 6,356,791 
Dividends in excess of earningsDividends in excess of earnings(570,982)(509,653)Dividends in excess of earnings(657,021)(509,653)
Treasury common stock at cost, 78,900 shares at March 31, 2021 and December 31, 2020(2,722)(2,722)
Treasury common stock at cost, 78,900 shares at September 30, 2021 and December 31, 2020Treasury common stock at cost, 78,900 shares at September 30, 2021 and December 31, 2020(2,722)(2,722)
Accumulated other comprehensive lossAccumulated other comprehensive loss(45,139)(49,890)Accumulated other comprehensive loss(40,803)(49,890)
Total stockholders’ equity attributable to Boston Properties, Inc.Total stockholders’ equity attributable to Boston Properties, Inc.5,775,641 5,996,083 Total stockholders’ equity attributable to Boston Properties, Inc.5,716,818 5,996,083 
Noncontrolling interests:Noncontrolling interests:Noncontrolling interests:
Common units of Boston Properties Limited PartnershipCommon units of Boston Properties Limited Partnership620,106 616,596 Common units of Boston Properties Limited Partnership609,830 616,596 
Property partnershipsProperty partnerships1,725,600 1,726,933 Property partnerships1,728,101 1,726,933 
Total equityTotal equity8,121,347 8,339,612 Total equity8,054,749 8,339,612 
Total liabilities and equityTotal liabilities and equity$22,213,552 $22,858,190 Total liabilities and equity$22,848,810 $22,858,190 
















The accompanying notes are an integral part of these consolidated financial statements.
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BOSTON PROPERTIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited and in thousands, except for per share amounts)
Three months ended March 31,Three months ended September 30,Nine months ended September 30,
20212020 2021202020212020
RevenueRevenueRevenue
LeaseLease$685,817 $710,111 Lease$692,260 $666,674 $2,062,102 $2,006,904 
Parking and otherParking and other16,938 24,504 Parking and other23,507 16,327 58,727 54,777 
HotelHotel632 6,825 Hotel5,189 90 7,382 7,014 
Development and management servicesDevelopment and management services6,803 7,879 Development and management services6,094 7,281 20,181 23,285 
Direct reimbursements of payroll and related costs from management services contractsDirect reimbursements of payroll and related costs from management services contracts3,505 3,237 Direct reimbursements of payroll and related costs from management services contracts3,006 2,896 9,166 8,617 
Total revenueTotal revenue713,695 752,556 Total revenue730,056 693,268 2,157,558 2,100,597 
ExpensesExpensesExpenses
OperatingOperatingOperating
RentalRental257,389 262,966 Rental258,281 258,261 764,373 761,014 
HotelHotel2,051 6,821 Hotel3,946 3,164 7,993 11,958 
General and administrativeGeneral and administrative44,959 36,454 General and administrative34,560 27,862 117,924 102,059 
Payroll and related costs from management services contractsPayroll and related costs from management services contracts3,505 3,237 Payroll and related costs from management services contracts3,006 2,896 9,166 8,617 
Transaction costsTransaction costs331 615 Transaction costs1,888 307 2,970 1,254 
Depreciation and amortizationDepreciation and amortization176,565 171,094 Depreciation and amortization179,412 166,456 539,815 515,738 
Total expensesTotal expenses484,800 481,187 Total expenses481,093 458,946 1,442,241 1,400,640 
Other income (expense)Other income (expense)Other income (expense)
Income (loss) from unconsolidated joint ventures5,225 (369)
Gains on sales of real estate410,165 
Loss from unconsolidated joint venturesLoss from unconsolidated joint ventures(5,597)(6,873)(1,745)(5,410)
Gains (losses) on sales of real estateGains (losses) on sales of real estate348 (209)8,104 613,723 
Interest and other income (loss)Interest and other income (loss)1,168 3,017 Interest and other income (loss)1,520 (45)4,140 4,277 
Gains (losses) from investments in securitiesGains (losses) from investments in securities1,659 (5,445)Gains (losses) from investments in securities(190)1,858 3,744 965 
Losses from early extinguishment of debtLosses from early extinguishment of debt(898)Losses from early extinguishment of debt— — (898)— 
Interest expenseInterest expense(107,902)(101,591)Interest expense(105,794)(110,993)(320,015)(319,726)
Net incomeNet income128,147 577,146 Net income139,250 118,060 408,647 993,786 
Net income attributable to noncontrolling interestsNet income attributable to noncontrolling interestsNet income attributable to noncontrolling interests
Noncontrolling interests in property partnershipsNoncontrolling interests in property partnerships(16,467)(19,486)Noncontrolling interests in property partnerships(18,971)(15,561)(52,602)(34,280)
Noncontrolling interest—common units of the Operating PartnershipNoncontrolling interest—common units of the Operating Partnership(11,084)(57,539)Noncontrolling interest—common units of the Operating Partnership(11,982)(10,020)(35,393)(97,090)
Net income attributable to Boston Properties, Inc.Net income attributable to Boston Properties, Inc.100,596 500,121 Net income attributable to Boston Properties, Inc.108,297 92,479 320,652 862,416 
Preferred dividendsPreferred dividends(2,560)(2,625)Preferred dividends— (2,625)(2,560)(7,875)
Preferred stock redemption chargePreferred stock redemption charge(6,412)Preferred stock redemption charge— — (6,412)— 
Net income attributable to Boston Properties, Inc. common shareholdersNet income attributable to Boston Properties, Inc. common shareholders$91,624 $497,496 Net income attributable to Boston Properties, Inc. common shareholders$108,297 $89,854 $311,680 $854,541 
Basic earnings per common share attributable to Boston Properties, Inc. common shareholders:Basic earnings per common share attributable to Boston Properties, Inc. common shareholders:Basic earnings per common share attributable to Boston Properties, Inc. common shareholders:
Net incomeNet income$0.59 $3.20 Net income$0.69 $0.58 $2.00 $5.49 
Weighted average number of common shares outstandingWeighted average number of common shares outstanding155,928 155,011 Weighted average number of common shares outstanding156,183 155,645 156,062 155,349 
Diluted earnings per common share attributable to Boston Properties, Inc. common shareholders:Diluted earnings per common share attributable to Boston Properties, Inc. common shareholders:Diluted earnings per common share attributable to Boston Properties, Inc. common shareholders:
Net incomeNet income$0.59 $3.20 Net income$0.69 $0.58 $1.99 $5.49 
Weighted average number of common and common equivalent shares outstandingWeighted average number of common and common equivalent shares outstanding156,099 155,258 Weighted average number of common and common equivalent shares outstanding156,598 155,670 156,394 155,447 

The accompanying notes are an integral part of these consolidated financial statements.
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BOSTON PROPERTIES, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(unaudited and in thousands)
 
Three months ended March 31,Three months ended September 30,Nine months ended September 30,
20212020 2021202020212020
Net incomeNet income$128,147 $577,146 Net income$139,250 $118,060 $408,647 $993,786 
Other comprehensive income (loss):Other comprehensive income (loss):Other comprehensive income (loss):
Effective portion of interest rate contractsEffective portion of interest rate contracts3,740 (9,720)Effective portion of interest rate contracts1,088 1,027 5,482 (9,352)
Amortization of interest rate contracts (1)Amortization of interest rate contracts (1)1,676 1,666 Amortization of interest rate contracts (1)1,676 1,677 5,028 5,020 
Other comprehensive income (loss)Other comprehensive income (loss)5,416 (8,054)Other comprehensive income (loss)2,764 2,704 10,510 (4,332)
Comprehensive incomeComprehensive income133,563 569,092 Comprehensive income142,014 120,764 419,157 989,454 
Net income attributable to noncontrolling interestsNet income attributable to noncontrolling interests(27,551)(77,025)Net income attributable to noncontrolling interests(30,953)(25,581)(87,995)(131,370)
Other comprehensive (income) loss attributable to noncontrolling interestsOther comprehensive (income) loss attributable to noncontrolling interests(665)689 Other comprehensive (income) loss attributable to noncontrolling interests(401)(405)(1,423)45 
Comprehensive income attributable to Boston Properties, Inc.Comprehensive income attributable to Boston Properties, Inc.$105,347 $492,756 Comprehensive income attributable to Boston Properties, Inc.$110,660 $94,778 $329,739 $858,129 
_______________
(1)Amounts reclassified from comprehensive income primarily to interest expense within Boston Properties, Inc.’s Consolidated Statements of Operations.
































The accompanying notes are an integral part of these consolidated financial statements.
4

Table of Contents
BOSTON PROPERTIES, INC.
CONSOLIDATED STATEMENTS OF EQUITY
(unaudited and in thousands)
BOSTON PROPERTIES, INC.
CONSOLIDATED STATEMENTS OF EQUITY
(unaudited and in thousands)
BOSTON PROPERTIES, INC.
CONSOLIDATED STATEMENTS OF EQUITY
(unaudited and in thousands)
Common StockPreferred StockAdditional Paid-in CapitalDividends in Excess of EarningsTreasury Stock,
at cost
Accumulated Other Comprehensive LossNoncontrolling Interests - Common UnitsNoncontrolling Interests - Property PartnershipsTotal Common StockPreferred StockAdditional Paid-in CapitalDividends in Excess of EarningsTreasury Stock,
at cost
Accumulated Other Comprehensive LossNoncontrolling Interests - Common UnitsNoncontrolling Interests - Property PartnershipsTotal
SharesAmount SharesAmount
Equity, December 31, 2020155,719 $1,557 $200,000 $6,356,791 $(509,653)$(2,722)$(49,890)$616,596 $1,726,933 $8,339,612 
Redemption of operating partnership units to common stock118 — 4,197 — — — (4,198)— 
Allocated net income for the year— — — — 100,596 — — 11,084 16,467 128,147 
Dividends/distributions declared— — — — (155,513)— — (17,287)— (172,800)
Shares issued pursuant to stock purchase plan— — 484 — — — — — 484 
Net activity from stock option and incentive plan232 — 20,002 — — — 18,462 — 38,467 
Preferred stock redemption— — (200,000)6,377 — — — — — (193,623)
Preferred stock redemption charge— — — — (6,412)— — — — (6,412)
Contributions from noncontrolling interests in property partnerships— — — — — — — — 281 281 
Distributions to noncontrolling interests in property partnerships— — — — — — — — (18,225)(18,225)
Effective portion of interest rate contracts— — — — — — 3,370 370 3,740 
Amortization of interest rate contracts— — — — — — 1,381 151 144 1,676 
Reallocation of noncontrolling interest— — — 5,072 — — — (5,072)— 
Equity, March 31, 2021156,074 $1,561 $$6,392,923 $(570,982)$(2,722)$(45,139)$620,106 $1,725,600 $8,121,347 
Equity, December 31, 2019154,790 $1,548 $200,000 $6,294,719 $(760,523)$(2,722)$(48,335)$600,860 $1,728,689 $8,014,236 
Cumulative effect of a change in accounting principle— — — — (1,505)— — (174)(1,679)
Equity, June 30, 2021Equity, June 30, 2021156,136 $1,561 $— $6,405,916 $(612,247)$(2,722)$(43,166)$615,308 $1,725,343 $8,089,993 
Redemption of operating partnership units to common stockRedemption of operating partnership units to common stock462 — 15,490 — — — (15,495)— Redemption of operating partnership units to common stock50 — 1,747 — — — (1,748)— — 
Allocated net income for the periodAllocated net income for the period— — — — 500,121 — — 57,539 19,486 577,146 Allocated net income for the period— — — — 108,308 — — 11,971 18,971 139,250 
Dividends/distributions declaredDividends/distributions declared— — — — (154,833)— — (17,444)— (172,277)Dividends/distributions declared— — — — (153,082)— — (17,203)— (170,285)
Shares issued pursuant to stock purchase planShares issued pursuant to stock purchase plan— — 325 — — — — — 325 Shares issued pursuant to stock purchase plan— — 520 — — — — — 520 
Net activity from stock option and incentive planNet activity from stock option and incentive plan61 — — 7,383 — — — 15,677 — 23,060 Net activity from stock option and incentive plan16 — — 1,185 — — — 7,679 — 8,864 
Contributions from noncontrolling interests in property partnershipsContributions from noncontrolling interests in property partnerships— — — — — — — — 3,876 3,876 Contributions from noncontrolling interests in property partnerships— — — — — — — — 11,318 11,318 
Distributions to noncontrolling interests in property partnershipsDistributions to noncontrolling interests in property partnerships— — — — — — — — (15,750)(15,750)Distributions to noncontrolling interests in property partnerships— — — — — — — — (27,675)(27,675)
Effective portion of interest rate contractsEffective portion of interest rate contracts— — — — — — (8,732)(988)— (9,720)Effective portion of interest rate contracts— — — — — — 981 107 — 1,088 
Amortization of interest rate contractsAmortization of interest rate contracts— — — — — — 1,367 155 144 1,666 Amortization of interest rate contracts— — — — — — 1,382 150 144 1,676 
Reallocation of noncontrolling interestReallocation of noncontrolling interest— — — 3,558 — — — (3,558)— Reallocation of noncontrolling interest— — — 6,434 — — — (6,434)— — 
Equity, March 31, 2020155,315 $1,553 $200,000 $6,321,475 $(416,740)$(2,722)$(55,700)$636,572 $1,736,445 $8,420,883 
Equity, September 30, 2021Equity, September 30, 2021156,206 $1,562 $— $6,415,802 $(657,021)$(2,722)$(40,803)$609,830 $1,728,101 $8,054,749 
Equity, June 30, 2020Equity, June 30, 2020155,622 $1,556 $200,000 $6,340,665 $(302,511)$(2,722)$(54,921)$640,491 $1,724,588 8,547,146 
Redemption of operating partnership units to common stockRedemption of operating partnership units to common stock— — 338 — — — (338)— — 
Allocated net income for the periodAllocated net income for the period— — — — 92,934 — — 9,565 15,561 118,060 
Dividends/distributions declaredDividends/distributions declared— — — — (155,143)— — (17,183)— (172,326)
Shares issued pursuant to stock purchase planShares issued pursuant to stock purchase plan— — 434 — — — — — 434 
Net activity from stock option and incentive planNet activity from stock option and incentive plan— — — 1,390 — — — 7,249 — 8,639 
Contributions from noncontrolling interests in property partnershipsContributions from noncontrolling interests in property partnerships— — — — — — — — 1,407 1,407 
Distributions to noncontrolling interests in property partnershipsDistributions to noncontrolling interests in property partnerships— — — — — — — — (11,026)(11,026)
Effective portion of interest rate contractsEffective portion of interest rate contracts— — — — — — 917 110 — 1,027 
Amortization of interest rate contractsAmortization of interest rate contracts— — — — — — 1,382 151 144 1,677 
Reallocation of noncontrolling interestReallocation of noncontrolling interest— — — 5,249 — — — (5,249)— — 
Equity, September 30, 2020Equity, September 30, 2020155,636 $1,556 $200,000 $6,348,076 $(364,720)$(2,722)$(52,622)$634,796 $1,730,674 $8,495,038 
5

Table of Contents
BOSTON PROPERTIES, INC.
CONSOLIDATED STATEMENTS OF EQUITY
 (unaudited and in thousands)
 Common StockPreferred StockAdditional Paid-in CapitalDividends in Excess of EarningsTreasury Stock,
at cost
Accumulated Other Comprehensive LossNoncontrolling Interests - Common UnitsNoncontrolling Interests - Property PartnershipsTotal
 SharesAmount
Equity, December 31, 2020155,719 $1,557 $200,000 $6,356,791 $(509,653)$(2,722)$(49,890)$616,596 $1,726,933 $8,339,612 
Redemption of operating partnership units to common stock227 — 8,031 — — — (8,033)— — 
Allocated net income for the period— — — — 320,652 — — 35,393 52,602 408,647 
Dividends/distributions declared— — — — (461,608)— — (51,743)— (513,351)
Shares issued pursuant to stock purchase plan— — 1,004 — — — — — 1,004 
Net activity from stock option and incentive plan251 — 20,893 — — — 39,332 — 60,228 
Preferred stock redemption— — (200,000)6,377 — — — — — (193,623)
Preferred stock redemption charge— — — — (6,412)— — — — (6,412)
Contributions from noncontrolling interests in property partnerships— — — — — — — — 13,738 13,738 
Distributions to noncontrolling interests in property partnerships— — — — — — — — (65,604)(65,604)
Effective portion of interest rate contracts— — — — — — 4,943 539 — 5,482 
Amortization of interest rate contracts— — — — — — 4,144 452 432 5,028 
Reallocation of noncontrolling interest— — — 22,706 — — — (22,706)— — 
Equity, September 30, 2021156,206 $1,562 $— $6,415,802 $(657,021)$(2,722)$(40,803)$609,830 $1,728,101 $8,054,749 
Equity, December 31, 2019154,790 $1,548 $200,000 $6,294,719 $(760,523)$(2,722)$(48,335)$600,860 $1,728,689 $8,014,236 
Cumulative effect of a change in accounting principle— — — — (1,505)— — (174)— (1,679)
Redemption of operating partnership units to common stock774 — 26,674 — — — (26,682)— — 
Allocated net income for the period— — — — 862,416 — — 97,090 34,280 993,786 
Dividends/distributions declared— — — — (465,108)— — (51,821)— (516,929)
Shares issued pursuant to stock purchase plan— — 759 — — — — — 759 
Net activity from stock option and incentive plan65 — — 9,646 — — — 32,278 — 41,924 
Contributions from noncontrolling interests in property partnerships— — — — — — — — 7,364 7,364 
Distributions to noncontrolling interests in property partnerships— — — — — — — — (40,091)(40,091)
Effective portion of interest rate contracts— — — — — — (8,416)(936)— (9,352)
Amortization of interest rate contracts— — — — — — 4,129 459 432 5,020 
Reallocation of noncontrolling interest— — — 16,278 — — — (16,278)— — 
Equity, September 30, 2020155,636 $1,556 $200,000 $6,348,076 $(364,720)$(2,722)$(52,622)$634,796 $1,730,674 $8,495,038 
The accompanying notes are an integral part of these consolidated financial statements.
56

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BOSTON PROPERTIES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited and in thousands)
BOSTON PROPERTIES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited and in thousands)
BOSTON PROPERTIES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited and in thousands)
Three months ended March 31, Nine months ended September 30,
20212020 20212020
Cash flows from operating activities:Cash flows from operating activities:Cash flows from operating activities:
Net incomeNet income$128,147 $577,146 Net income$408,647 $993,786 
Adjustments to reconcile net income to net cash provided by operating activities:Adjustments to reconcile net income to net cash provided by operating activities:Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortizationDepreciation and amortization176,565 171,094 Depreciation and amortization539,815 515,738 
Amortization of right of use assets - operating leasesAmortization of right of use assets - operating leases2,263 583 Amortization of right of use assets - operating leases3,208 1,667 
Non-cash compensation expenseNon-cash compensation expense20,090 17,525 Non-cash compensation expense43,098 36,152 
Loss (income) from unconsolidated joint ventures(5,225)369 
Loss from unconsolidated joint venturesLoss from unconsolidated joint ventures1,745 5,410 
Distributions of net cash flow from operations of unconsolidated joint venturesDistributions of net cash flow from operations of unconsolidated joint ventures3,972 5,917 Distributions of net cash flow from operations of unconsolidated joint ventures18,462 22,285 
(Gains) losses from investments in securities(1,659)5,445 
Gains from investments in securitiesGains from investments in securities(3,744)(965)
Allowance for current expected credit lossesAllowance for current expected credit losses(128)Allowance for current expected credit losses(758)1,997 
Non-cash portion of interest expenseNon-cash portion of interest expense5,984 5,646 Non-cash portion of interest expense17,584 17,397 
Settlement of accreted debt discount on redemption of unsecured senior notesSettlement of accreted debt discount on redemption of unsecured senior notes(6,290)Settlement of accreted debt discount on redemption of unsecured senior notes(6,290)— 
Losses from early extinguishments of debtLosses from early extinguishments of debt898 Losses from early extinguishments of debt898 — 
Gains on sales of real estateGains on sales of real estate(410,165)Gains on sales of real estate(8,104)(613,723)
Change in assets and liabilities:Change in assets and liabilities:Change in assets and liabilities:
Tenant and other receivables, netTenant and other receivables, net26,020 17,784 Tenant and other receivables, net13,738 18,543 
Notes receivable, netNotes receivable, net(140)(128)Notes receivable, net(419)(395)
Accrued rental income, netAccrued rental income, net(9,413)(27,285)Accrued rental income, net(74,283)(85,843)
Prepaid expenses and other assetsPrepaid expenses and other assets(96,351)(93,819)Prepaid expenses and other assets(61,019)(60,365)
Lease liabilities - operating leasesLease liabilities - operating leases(1,330)393 Lease liabilities - operating leases(24,023)1,157 
Accounts payable and accrued expensesAccounts payable and accrued expenses(21,578)(48,591)Accounts payable and accrued expenses26,097 8,273 
Accrued interest payableAccrued interest payable(28,970)(7,644)Accrued interest payable(18,237)(1,202)
Other liabilitiesOther liabilities(24,177)(21,296)Other liabilities(51,938)(24,868)
Tenant leasing costsTenant leasing costs(16,615)(17,777)Tenant leasing costs(37,618)(52,621)
Total adjustmentsTotal adjustments23,916 (401,949)Total adjustments378,212 (211,363)
Net cash provided by operating activitiesNet cash provided by operating activities152,063 175,197 Net cash provided by operating activities786,859 782,423 
Cash flows from investing activities:Cash flows from investing activities:Cash flows from investing activities:
Acquisitions of real estateAcquisitions of real estate(218,679)(135,698)
Construction in progressConstruction in progress(119,496)(143,160)Construction in progress(381,104)(358,824)
Building and other capital improvementsBuilding and other capital improvements(32,717)(39,154)Building and other capital improvements(103,840)(116,894)
Tenant improvementsTenant improvements(93,201)(64,172)Tenant improvements(218,878)(172,401)
Proceeds from sales of real estateProceeds from sales of real estate259,489 Proceeds from sales of real estate— 505,679 
Capital contributions to unconsolidated joint venturesCapital contributions to unconsolidated joint ventures(16,684)(89,997)Capital contributions to unconsolidated joint ventures(95,462)(158,374)
Capital distributions from unconsolidated joint venturesCapital distributions from unconsolidated joint ventures122 Capital distributions from unconsolidated joint ventures122 55,123 
Issuance of notes receivable, netIssuance of notes receivable, net— (9,800)
Proceeds from sale of investment in unconsolidated joint ventureProceeds from sale of investment in unconsolidated joint venture17,589 Proceeds from sale of investment in unconsolidated joint venture17,789 — 
Investments in securities, netInvestments in securities, net2,114 3,201 Investments in securities, net1,684 2,778 
Net cash used in investing activitiesNet cash used in investing activities(242,273)(73,793)Net cash used in investing activities(998,368)(388,411)
Cash flows from financing activities:Cash flows from financing activities:Cash flows from financing activities:
Repayments of mortgage notes payableRepayments of mortgage notes payable(5,374)(4,212)Repayments of mortgage notes payable(13,261)(12,795)
Proceeds from unsecured senior notesProceeds from unsecured senior notes846,345 Proceeds from unsecured senior notes1,695,996 1,248,125 
Redemption of unsecured senior notesRedemption of unsecured senior notes(843,710)Redemption of unsecured senior notes(843,710)— 
Borrowings on unsecured line of creditBorrowings on unsecured line of credit265,000 Borrowings on unsecured line of credit300,000 265,000 
Repayments of unsecured line of creditRepayments of unsecured line of credit(15,000)Repayments of unsecured line of credit(300,000)(265,000)
Repayment of unsecured term loan(500,000)
Deferred financing costs(7,145)(11)
67

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BOSTON PROPERTIES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited and in thousands)
 Three months ended March 31,
 20212020
Debt prepayment and extinguishment costs(185)
Net proceeds from equity transactions19,643 3,349 
Dividends and distributions(171,566)(171,964)
Contributions from noncontrolling interests in property partnerships281 3,876 
Distributions to noncontrolling interests in property partnerships(18,225)(15,750)
Net cash provided by (used in) financing activities(679,936)65,288 
Net increase (decrease) in cash and cash equivalents and cash held in escrows(770,146)166,692 
Cash and cash equivalents and cash held in escrows, beginning of period1,719,329 691,886 
Cash and cash equivalents and cash held in escrows, end of period$949,183 $858,578 
Reconciliation of cash and cash equivalents and cash held in escrows:
Cash and cash equivalents, beginning of period$1,668,742 $644,950 
Cash held in escrows, beginning of period50,587 46,936 
Cash and cash equivalents and cash held in escrows, beginning of period$1,719,329 $691,886 
Cash and cash equivalents, end of period$697,369 $660,733 
Cash held in escrows, end of period251,814 197,845 
Cash and cash equivalents and cash held in escrows, end of period$949,183 $858,578 
Supplemental disclosures:
Cash paid for interest$146,781 $114,696 
Interest capitalized$12,032 $14,149 
Non-cash investing and financing activities:
Write-off of fully depreciated real estate$(25,161)$(38,782)
Change in real estate included in accounts payable and accrued expenses$(42,778)$(27,415)
Preferred stock redemption liability$200,000 $
Accrued rental income, net deconsolidated$$(4,558)
Tenant leasing costs, net deconsolidated$$(3,462)
Building and other capital improvements, net deconsolidated$$(111,889)
Tenant improvements, net deconsolidated$$(12,331)
Investment in unconsolidated joint venture recorded upon deconsolidation$$347,898 
Deferred distributions from sale of investment in unconsolidated joint venture$5,808 $
Deferred proceeds from sale of investment in unconsolidated joint venture$200 $
Dividends and distributions declared but not paid$171,003 $171,026 
Conversions of noncontrolling interests to stockholders’ equity$4,198 $15,495 
Issuance of restricted securities to employees and non-employee directors$41,255 $43,104 


BOSTON PROPERTIES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited and in thousands)
 Nine months ended September 30,
 20212020
Repayment of unsecured term loan(500,000)— 
Redemption of preferred stock(200,000)— 
Payments on finance lease obligations1,250 — 
Deferred financing costs(20,770)(10,416)
Debt prepayment and extinguishment costs(185)— 
Net proceeds from equity transactions20,028 3,276 
Dividends and distributions(513,381)(516,572)
Contributions from noncontrolling interests in property partnerships13,738 7,364 
Distributions to noncontrolling interests in property partnerships(65,604)(40,091)
Net cash provided by (used in) financing activities(425,899)678,891 
Net increase (decrease) in cash and cash equivalents and cash held in escrows(637,408)1,072,903 
Cash and cash equivalents and cash held in escrows, beginning of period1,719,329 691,886 
Cash and cash equivalents and cash held in escrows, end of period$1,081,921 $1,764,789 
Reconciliation of cash and cash equivalents and cash held in escrows:
Cash and cash equivalents, beginning of period$1,668,742 $644,950 
Cash held in escrows, beginning of period50,587 46,936 
Cash and cash equivalents and cash held in escrows, beginning of period$1,719,329 $691,886 
Cash and cash equivalents, end of period$1,002,728 $1,714,783 
Cash held in escrows, end of period79,193 50,006 
Cash and cash equivalents and cash held in escrows, end of period$1,081,921 $1,764,789 
Supplemental disclosures:
Cash paid for interest$358,015 $335,591 
Interest capitalized$36,632 $41,329 
Non-cash investing and financing activities:
Write-off of fully depreciated real estate$(159,108)$(73,584)
Change in real estate included in accounts payable and accrued expenses$(22,104)$(30,924)
Right-of-use assets obtained in exchange for lease liabilities$26,887 $— 
Accrued rental income, net deconsolidated$— $(4,558)
Tenant leasing costs, net deconsolidated$— $(3,462)
Building and other capital improvements, net deconsolidated$— $(111,889)
Tenant improvements, net deconsolidated$— $(12,331)
Investment in unconsolidated joint venture recorded upon deconsolidation$— $347,898 
Dividends and distributions declared but not paid$169,739 $171,070 
Conversions of noncontrolling interests to stockholders’ equity$8,033 $26,682 
Issuance of restricted securities to employees and non-employee directors$44,257 $43,244 

The accompanying notes are an integral part of these consolidated financial statements.
78

Table of Contents

BOSTON PROPERTIES LIMITED PARTNERSHIP
CONSOLIDATED BALANCE SHEETS
(unaudited and in thousands, except for unit amounts)
BOSTON PROPERTIES LIMITED PARTNERSHIP
CONSOLIDATED BALANCE SHEETS
(unaudited and in thousands, except for unit amounts)
BOSTON PROPERTIES LIMITED PARTNERSHIP
CONSOLIDATED BALANCE SHEETS
(unaudited and in thousands, except for unit amounts)
March 31,
2021
December 31,
2020
September 30,
2021
December 31,
2020
ASSETSASSETSASSETS
Real estate, at cost (amounts related to variable interest entities (“VIEs”) of $6,615,237 and $6,592,019 at March 31, 2021 and December 31, 2020, respectively)$22,781,429 $22,592,301 
Right of use assets - finance leases (amounts related to VIEs of $21,000 and $21,000 at March 31, 2021 and December 31, 2020, respectively)237,017 237,393 
Real estate, at cost (amounts related to variable interest entities (“VIEs”) of $6,688,647 and $6,592,019 at September 30, 2021 and December 31, 2020, respectively)Real estate, at cost (amounts related to variable interest entities (“VIEs”) of $6,688,647 and $6,592,019 at September 30, 2021 and December 31, 2020, respectively)$23,335,905 $22,592,301 
Right of use assets - finance leases (amounts related to VIEs of $21,000 and $21,000 at September 30, 2021 and December 31, 2020, respectively)Right of use assets - finance leases (amounts related to VIEs of $21,000 and $21,000 at September 30, 2021 and December 31, 2020, respectively)237,845 237,393 
Right of use assets - operating leasesRight of use assets - operating leases144,143 146,406 Right of use assets - operating leases170,085 146,406 
Less: accumulated depreciation (amounts related to VIEs of $(1,188,554) and $(1,158,548) at March 31, 2021 and December 31, 2020, respectively)(5,557,784)(5,428,576)
Less: accumulated depreciation (amounts related to VIEs of $(1,266,516) and $(1,158,548) at September 30, 2021 and December 31, 2020, respectively)Less: accumulated depreciation (amounts related to VIEs of $(1,266,516) and $(1,158,548) at September 30, 2021 and December 31, 2020, respectively)(5,739,625)(5,428,576)
Total real estateTotal real estate17,604,805 17,547,524 Total real estate18,004,210 17,547,524 
Cash and cash equivalents (amounts related to VIEs of $289,737 and $340,642 at March 31, 2021 and December 31, 2020, respectively)697,369 1,668,742 
Cash and cash equivalents (amounts related to VIEs of $288,186 and $340,642 at September 30, 2021 and December 31, 2020, respectively)Cash and cash equivalents (amounts related to VIEs of $288,186 and $340,642 at September 30, 2021 and December 31, 2020, respectively)1,002,728 1,668,742 
Cash held in escrowsCash held in escrows251,814 50,587 Cash held in escrows79,193 50,587 
Investments in securitiesInvestments in securities39,002 39,457 Investments in securities41,517 39,457 
Tenant and other receivables, net (amounts related to VIEs of $5,846 and $10,911 at March 31, 2021 and December 31, 2020, respectively)51,271 77,411 
Tenant and other receivables, net (amounts related to VIEs of $8,598 and $10,911 at September 30, 2021 and December 31, 2020, respectively)Tenant and other receivables, net (amounts related to VIEs of $8,598 and $10,911 at September 30, 2021 and December 31, 2020, respectively)61,269 77,411 
Related party note receivable, netRelated party note receivable, net77,640 77,552 Related party note receivable, net78,144 77,552 
Notes receivable, netNotes receivable, net18,891 18,729 Notes receivable, net19,297 18,729 
Accrued rental income, net (amounts related to VIEs of $341,772 and $336,594 at March 31, 2021 and December 31, 2020, respectively)1,145,066 1,122,502 
Deferred charges, net (amounts related to VIEs of $177,647 and $183,306 at March 31, 2021 and December 31, 2020, respectively)622,649 640,085 
Prepaid expenses and other assets (amounts related to VIEs of $45,075 and $13,137 at March 31, 2021 and December 31, 2020, respectively)129,102 33,840 
Accrued rental income, net (amounts related to VIEs of $352,291 and $336,594 at September 30, 2021 and December 31, 2020, respectively)Accrued rental income, net (amounts related to VIEs of $352,291 and $336,594 at September 30, 2021 and December 31, 2020, respectively)1,203,840 1,122,502 
Deferred charges, net (amounts related to VIEs of $174,172 and $183,306 at September 30, 2021 and December 31, 2020, respectively)Deferred charges, net (amounts related to VIEs of $174,172 and $183,306 at September 30, 2021 and December 31, 2020, respectively)622,807 640,085 
Prepaid expenses and other assets (amounts related to VIEs of $42,051 and $13,137 at September 30, 2021 and December 31, 2020, respectively)Prepaid expenses and other assets (amounts related to VIEs of $42,051 and $13,137 at September 30, 2021 and December 31, 2020, respectively)97,560 33,840 
Investments in unconsolidated joint venturesInvestments in unconsolidated joint ventures1,307,725 1,310,478 Investments in unconsolidated joint ventures1,373,522 1,310,478 
Total assetsTotal assets$21,945,334 $22,586,907 Total assets$22,584,087 $22,586,907 
LIABILITIES AND CAPITALLIABILITIES AND CAPITALLIABILITIES AND CAPITAL
Liabilities:Liabilities:Liabilities:
Mortgage notes payable, net (amounts related to VIEs of $2,904,672 and $2,907,590 at March 31, 2021 and December 31, 2020, respectively)$2,904,672 $2,909,081 
Mortgage notes payable, net (amounts related to VIEs of $2,898,699 and $2,907,590 at September 30, 2021 and December 31, 2020, respectively)Mortgage notes payable, net (amounts related to VIEs of $2,898,699 and $2,907,590 at September 30, 2021 and December 31, 2020, respectively)$2,898,699 $2,909,081 
Unsecured senior notes, netUnsecured senior notes, net9,631,592 9,639,287 Unsecured senior notes, net10,479,651 9,639,287 
Unsecured line of creditUnsecured line of creditUnsecured line of credit— — 
Unsecured term loan, netUnsecured term loan, net499,390 Unsecured term loan, net— 499,390 
Lease liabilities - finance leases (amounts related to VIEs of $20,345 and $20,306 at March 31, 2021 and December 31, 2020, respectively)239,361 236,492 
Lease liabilities - finance leases (amounts related to VIEs of $20,420 and $20,306 at September 30, 2021 and December 31, 2020, respectively)Lease liabilities - finance leases (amounts related to VIEs of $20,420 and $20,306 at September 30, 2021 and December 31, 2020, respectively)243,562 236,492 
Lease liabilities - operating leasesLease liabilities - operating leases200,383 201,713 Lease liabilities - operating leases204,137 201,713 
Accounts payable and accrued expenses (amounts related to VIEs of $15,957 and $23,128 at March 31, 2021 and December 31, 2020, respectively)260,875 336,264 
Accounts payable and accrued expenses (amounts related to VIEs of $36,967 and $23,128 at September 30, 2021 and December 31, 2020, respectively)Accounts payable and accrued expenses (amounts related to VIEs of $36,967 and $23,128 at September 30, 2021 and December 31, 2020, respectively)331,687 336,264 
Dividends and distributions payableDividends and distributions payable171,003 171,082 Dividends and distributions payable169,739 171,082 
Accrued interest payableAccrued interest payable76,675 106,288 Accrued interest payable87,408 106,288 
Preferred unit redemption liability200,000 
Other liabilities (amounts related to VIEs of $141,547 and $158,805 at March 31, 2021 and December 31, 2020, respectively)399,965 412,084 
Other liabilities (amounts related to VIEs of $124,615 and $158,805 at September 30, 2021 and December 31, 2020, respectively)Other liabilities (amounts related to VIEs of $124,615 and $158,805 at September 30, 2021 and December 31, 2020, respectively)370,403 412,084 
Total liabilitiesTotal liabilities14,084,526 14,511,681 Total liabilities14,785,286 14,511,681 
Commitments and contingencies (See Note 9)Commitments and contingencies (See Note 9)Commitments and contingencies (See Note 9)
Redeemable deferred stock units— 80,989 and 72,966 units outstanding at redemption value at September 30, 2021 and December 31, 2020, respectivelyRedeemable deferred stock units— 80,989 and 72,966 units outstanding at redemption value at September 30, 2021 and December 31, 2020, respectively8,775 6,897 
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BOSTON PROPERTIES LIMITED PARTNERSHIP
CONSOLIDATED BALANCE SHEETS
(unaudited and in thousands, except for unit amounts)
BOSTON PROPERTIES LIMITED PARTNERSHIP
CONSOLIDATED BALANCE SHEETS
(unaudited and in thousands, except for unit amounts)
BOSTON PROPERTIES LIMITED PARTNERSHIP
CONSOLIDATED BALANCE SHEETS
(unaudited and in thousands, except for unit amounts)
March 31,
2021
December 31,
2020
September 30,
2021
December 31,
2020
Redeemable deferred stock units— 75,834 and 72,966 units outstanding at redemption value at March 31, 2021 and December 31, 2020, respectively7,679 6,897 
Noncontrolling interests:Noncontrolling interests:Noncontrolling interests:
Redeemable partnership units— 16,053,640 and 16,037,121 common units and 1,525,306 and 1,336,115 long term incentive units outstanding at redemption value at March 31, 2021 and December 31, 2020, respectively1,780,044 1,643,024 
Redeemable partnership units— 15,989,304 and 16,037,121 common units and 1,487,492 and 1,336,115 long term incentive units outstanding at redemption value at September 30, 2021 and December 31, 2020, respectivelyRedeemable partnership units— 15,989,304 and 16,037,121 common units and 1,487,492 and 1,336,115 long term incentive units outstanding at redemption value at September 30, 2021 and December 31, 2020, respectively1,893,611 1,643,024 
Capital:Capital:Capital:
5.25% Series B cumulative redeemable preferred units, liquidation preference $2,500 per unit, 80,000 units issued and outstanding at March 31, 2021 and December 31, 2020193,623 
Boston Properties Limited Partnership partners’ capital— 1,736,531 and 1,730,921 general partner units and 154,337,669 and 153,987,904 limited partner units outstanding at March 31, 2021 and December 31, 2020, respectively4,392,624 4,554,639 
5.25% Series B cumulative redeemable preferred units, liquidation preference $2,500 per unit, 80,000 units issued and outstanding at December 31, 20205.25% Series B cumulative redeemable preferred units, liquidation preference $2,500 per unit, 80,000 units issued and outstanding at December 31, 2020— 193,623 
Boston Properties Limited Partnership partners’ capital— 1,736,833 and 1,730,921 general partner units and 154,469,658 and 153,987,904 limited partner units outstanding at September 30, 2021 and December 31, 2020, respectivelyBoston Properties Limited Partnership partners’ capital— 1,736,833 and 1,730,921 general partner units and 154,469,658 and 153,987,904 limited partner units outstanding at September 30, 2021 and December 31, 2020, respectively4,209,117 4,554,639 
Accumulated other comprehensive lossAccumulated other comprehensive loss(45,139)(49,890)Accumulated other comprehensive loss(40,803)(49,890)
Total partners’ capitalTotal partners’ capital4,347,485 4,698,372 Total partners’ capital4,168,314 4,698,372 
Noncontrolling interests in property partnershipsNoncontrolling interests in property partnerships1,725,600 1,726,933 Noncontrolling interests in property partnerships1,728,101 1,726,933 
Total capitalTotal capital6,073,085 6,425,305 Total capital5,896,415 6,425,305 
Total liabilities and capitalTotal liabilities and capital$21,945,334 $22,586,907 Total liabilities and capital$22,584,087 $22,586,907 




























The accompanying notes are an integral part of these consolidated financial statements.
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BOSTON PROPERTIES LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited and in thousands, except for per unit amounts)
 Three months ended March 31,
 20212020
Revenue
Lease$685,817 $710,111 
Parking and other16,938 24,504 
Hotel632 6,825 
Development and management services6,803 7,879 
Direct reimbursements of payroll and related costs from management services contracts3,505 3,237 
Total revenue713,695 752,556 
Expenses
Operating
Rental257,389 262,966 
Hotel2,051 6,821 
General and administrative44,959 36,454 
Payroll and related costs from management services contracts3,505 3,237 
Transaction costs331 615 
Depreciation and amortization173,500 169,285 
Total expenses481,735 479,378 
Other income (expense)
Income (loss) from unconsolidated joint ventures5,225 (369)
Gains on sales of real estate419,654 
Interest and other income (loss)1,168 3,017 
Gains (losses) from investments in securities1,659 (5,445)
Losses from early extinguishment of debt(898)
Interest expense(107,902)(101,591)
Net income131,212 588,444 
Net income attributable to noncontrolling interests
Noncontrolling interests in property partnerships(16,467)(19,486)
Net income attributable to Boston Properties Limited Partnership114,745 568,958 
Preferred distributions(2,560)(2,625)
Preferred unit redemption charge(6,412)
Net income attributable to Boston Properties Limited Partnership common unitholders$105,773 $566,333 
Basic earnings per common unit attributable to Boston Properties Limited Partnership
Net income$0.61 $3.28 
Weighted average number of common units outstanding173,018 172,549 
Diluted earnings per common unit attributable to Boston Properties Limited Partnership
Net income$0.61 $3.27 
Weighted average number of common and common equivalent units outstanding173,189 172,796 

 Three months ended September 30,Nine months ended September 30,
 2021202020212020
Revenue
Lease$692,260 $666,674 $2,062,102 $2,006,904 
Parking and other23,507 16,327 58,727 54,777 
Hotel5,189 90 7,382 7,014 
Development and management services6,094 7,281 20,181 23,285 
Direct reimbursements of payroll and related costs from management services contracts3,006 2,896 9,166 8,617 
Total revenue730,056 693,268 2,157,558 2,100,597 
Expenses
Operating
Rental258,281 258,261 764,373 761,014 
Hotel3,946 3,164 7,993 11,958 
General and administrative34,560 27,862 117,924 102,059 
Payroll and related costs from management services contracts3,006 2,896 9,166 8,617 
Transaction costs1,888 307 2,970 1,254 
Depreciation and amortization177,677 164,706 533,255 510,400 
Total expenses479,358 457,196 1,435,681 1,395,302 
Other income (expense)
Loss from unconsolidated joint ventures(5,597)(6,873)(1,745)(5,410)
Gains (losses) on sales of real estate348 (209)8,104 626,686 
Interest and other income (loss)1,520 (45)4,140 4,277 
Gains (losses) from investments in securities(190)1,858 3,744 965 
Losses from early extinguishment of debt— — (898)— 
Interest expense(105,794)(110,993)(320,015)(319,726)
Net income140,985 119,810 415,207 1,012,087 
Net income attributable to noncontrolling interests
Noncontrolling interests in property partnerships(18,971)(15,561)(52,602)(34,280)
Net income attributable to Boston Properties Limited Partnership122,014 104,249 362,605 977,807 
Preferred distributions— (2,625)(2,560)(7,875)
Preferred unit redemption charge— — (6,412)— 
Net income attributable to Boston Properties Limited Partnership common unitholders$122,014 $101,624 $353,633 $969,932 
Basic earnings per common unit attributable to Boston Properties Limited Partnership
Net income$0.70 $0.59 $2.04 $5.61 
Weighted average number of common units outstanding173,194 172,677 173,078 172,628 
Diluted earnings per common unit attributable to Boston Properties Limited Partnership
Net income$0.70 $0.59 $2.04 $5.61 
Weighted average number of common and common equivalent units outstanding173,609 172,702 173,410 172,726 


The accompanying notes are an integral part of these consolidated financial statements.
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BOSTON PROPERTIES LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(unaudited and in thousands)
 
Three months ended March 31, Three months ended September 30,Nine months ended September 30,
20212020 2021202020212020
Net incomeNet income$131,212 $588,444 Net income$140,985 $119,810 $415,207 $1,012,087 
Other comprehensive income (loss):Other comprehensive income (loss):Other comprehensive income (loss):
Effective portion of interest rate contractsEffective portion of interest rate contracts3,740 (9,720)Effective portion of interest rate contracts1,088 1,027 5,482 (9,352)
Amortization of interest rate contracts (1)Amortization of interest rate contracts (1)1,676 1,666 Amortization of interest rate contracts (1)1,676 1,677 5,028 5,020 
Other comprehensive income (loss)Other comprehensive income (loss)5,416 (8,054)Other comprehensive income (loss)2,764 2,704 10,510 (4,332)
Comprehensive incomeComprehensive income136,628 580,390 Comprehensive income143,749 122,514 425,717 1,007,755 
Comprehensive income attributable to noncontrolling interestsComprehensive income attributable to noncontrolling interests(16,611)(19,630)Comprehensive income attributable to noncontrolling interests(19,115)(15,705)(53,034)(34,712)
Comprehensive income attributable to Boston Properties Limited PartnershipComprehensive income attributable to Boston Properties Limited Partnership$120,017 $560,760 Comprehensive income attributable to Boston Properties Limited Partnership$124,634 $106,809 $372,683 $973,043 
_______________
(1)Amounts reclassified from comprehensive income primarily to interest expense within Boston Properties Limited Partnership’s Consolidated Statements of Operations.





































The accompanying notes are an integral part of these consolidated financial statements.
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BOSTON PROPERTIES LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF CAPITAL AND NONCONTROLLING INTERESTS
(unaudited and in thousands)
UnitsCapital
 General PartnerLimited PartnerPartners’ Capital (General and Limited Partners)Preferred UnitsAccumulated
Other
Comprehensive Loss
Noncontrolling
Interests - Property Partnerships
Total CapitalNoncontrolling Interests - Redeemable Partnership Units
Equity, December 31, 20201,731 153,988 $4,554,639 $193,623 $(49,890)$1,726,933 $6,425,305 $1,643,024 
Net activity from contributions and unearned compensation233 20,489 — — — 20,489 18,462 
Allocated net income for the period— — 101,101 2,560 — 16,467 120,128 11,084 
Distributions— — (152,953)(2,560)— — (155,513)(17,287)
Preferred unit redemption— — — (193,623)— — (193,623)— 
Preferred unit redemption charge— — (6,412)— — — (6,412)— 
Conversion of redeemable partnership units117 4,198 — — — 4,198 (4,198)
Adjustment to reflect redeemable partnership units at redemption value— — (128,438)— — — (128,438)128,438 
Effective portion of interest rate contracts— — — — 3,370 — 3,370 370 
Amortization of interest rate contracts— — — — 1,381 144 1,525 151 
Contributions from noncontrolling interests in property partnerships— — — — — 281 281 — 
Distributions to noncontrolling interests in property partnerships— — — — — (18,225)(18,225)— 
Equity, March 31, 20211,737 154,338 $4,392,624 $$(45,139)$1,725,600 $6,073,085 $1,780,044 
Equity, December 31, 20191,727 153,063 $3,380,175 $193,623 $(48,335)$1,728,689 $5,254,152 $2,468,753 
Cumulative effect of a change in accounting principle— — (1,505)— — — (1,505)(174)
Net activity from contributions and unearned compensation63 7,708 — — — 7,708 15,677 
Allocated net income for the period— — 508,794 2,625 — 19,486 530,905 57,539 
Distributions— — (152,208)(2,625)— — (154,833)(17,444)
Conversion of redeemable partnership units458 15,495 — — — 15,495 (15,495)
Adjustment to reflect redeemable partnership units at redemption value— — 868,168 — — — 868,168 (868,168)
Effective portion of interest rate contracts— — — — (8,732)— (8,732)(988)
Amortization of interest rate contracts— — — — 1,367 144 1,511 155 
Contributions from noncontrolling interests in property partnerships— — — — — 3,876 3,876 — 
Distributions to noncontrolling interests in property partnerships— — — — — (15,750)(15,750)— 
Equity, March 31, 20201,731 153,584 $4,626,627 $193,623 $(55,700)$1,736,445 $6,500,995 $1,639,855 
The accompanying notes are an integral part of these consolidated financial statements.
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BOSTON PROPERTIES LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited and in thousands)
 Three months ended March 31,
 20212020
Cash flows from operating activities:
Net income$131,212 $588,444 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization173,500 169,285 
Amortization of right of use assets - operating leases2,263 583 
Non-cash compensation expense20,090 17,525 
Loss (income) from unconsolidated joint ventures(5,225)369 
Distributions of net cash flow from operations of unconsolidated joint ventures3,972 5,917 
(Gains) losses from investments in securities(1,659)5,445 
Allowance for current expected credit losses(128)
Non-cash portion of interest expense5,984 5,646 
Settlement of accreted debt discount on redemption of unsecured senior notes(6,290)
Losses from early extinguishments of debt898 
Gains on sales of real estate(419,654)
Change in assets and liabilities:
Tenant and other receivables, net26,020 17,784 
Notes receivable, net(140)(128)
Accrued rental income, net(9,413)(27,285)
Prepaid expenses and other assets(96,351)(93,819)
Lease liabilities - operating leases(1,330)393 
Accounts payable and accrued expenses(21,578)(48,591)
Accrued interest payable(28,970)(7,644)
Other liabilities(24,177)(21,296)
Tenant leasing costs(16,615)(17,777)
Total adjustments20,851 (413,247)
Net cash provided by operating activities152,063 175,197 
Cash flows from investing activities:
Construction in progress(119,496)(143,160)
Building and other capital improvements(32,717)(39,154)
Tenant improvements(93,201)(64,172)
Proceeds from sales of real estate259,489 
Capital contributions to unconsolidated joint ventures(16,684)(89,997)
Capital distributions from unconsolidated joint ventures122 
Proceeds from sale of investment in unconsolidated joint venture17,589 
Investments in securities, net2,114 3,201 
Net cash used in investing activities(242,273)(73,793)
Cash flows from financing activities:
Repayments of mortgage notes payable(5,374)(4,212)
Proceeds from unsecured senior notes846,345 
Redemption of unsecured senior notes(843,710)
Borrowings on unsecured line of credit265,000 
Repayments of unsecured line of credit(15,000)
Repayment of unsecured term loan(500,000)
Deferred financing costs(7,145)(11)
BOSTON PROPERTIES LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF CAPITAL AND NONCONTROLLING INTERESTS
(unaudited and in thousands)
UnitsCapital
 General PartnerLimited PartnerPartners’ Capital (General and Limited Partners)Preferred UnitsAccumulated
Other
Comprehensive Loss
Noncontrolling
Interests - Property Partnerships
Total CapitalNoncontrolling Interests - Redeemable Partnership Units
Equity, June 30, 20211,737 154,399 $4,132,880 $— $(43,166)$1,725,343 $5,815,057 $2,008,478 
Net activity from contributions and unearned compensation— 21 1,705 — — — 1,705 7,679 
Allocated net income for the period— — 110,043 — — 18,971 129,014 11,971 
Distributions— — (153,082)— — — (153,082)(17,203)
Conversion of redeemable partnership units— 50 1,748 — — — 1,748 (1,748)
Adjustment to reflect redeemable partnership units at redemption value— — 115,823 — — — 115,823 (115,823)
Effective portion of interest rate contracts— — — — 981 — 981 107 
Amortization of interest rate contracts— — — — 1,382 144 1,526 150 
Contributions from noncontrolling interests in property partnerships— — — — — 11,318 11,318 — 
Distributions to noncontrolling interests in property partnerships— — — — — (27,675)(27,675)— 
Equity, September 30, 20211,737 154,470 $4,209,117 $— $(40,803)$1,728,101 $5,896,415 $1,893,611 
Equity, June 30, 20201,731 153,891 $4,828,066 $193,623 $(54,921)$1,724,588 $6,691,356 $1,581,010 
Net activity from contributions and unearned compensation— 1,824 — — — 1,824 7,249 
Allocated net income (loss) for the period— — 92,059 2,625 — 15,561 110,245 9,565 
Distributions— — (152,518)(2,625)— — (155,143)(17,183)
Conversion of redeemable partnership units— 338 — — — 338 (338)
Adjustment to reflect redeemable partnership units at redemption value— — 174,080 — — — 174,080 (174,080)
Effective portion of interest rate contracts— — — — 917 — 917 110 
Amortization of interest rate contracts— — — — 1,382 144 1,526 151 
Contributions from noncontrolling interests in property partnerships— — — — — 1,407 1,407 — 
Distributions to noncontrolling interests in property partnerships— — — — — (11,026)(11,026)— 
Equity, September 30, 20201,731 153,905 $4,943,849 $193,623 $(52,622)$1,730,674 $6,815,524 $1,406,484 
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BOSTON PROPERTIES LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited and in thousands)
 Three months ended March 31,
 20212020
Debt prepayment and extinguishment costs(185)
Net proceeds from equity transactions19,643 3,349 
Distributions(171,566)(171,964)
Contributions from noncontrolling interests in property partnerships281 3,876 
Distributions to noncontrolling interests in property partnerships(18,225)(15,750)
Net cash provided by (used in) financing activities(679,936)65,288 
Net increase (decrease) in cash and cash equivalents and cash held in escrows(770,146)166,692 
Cash and cash equivalents and cash held in escrows, beginning of period1,719,329 691,886 
Cash and cash equivalents and cash held in escrows, end of period$949,183 $858,578 
Reconciliation of cash and cash equivalents and cash held in escrows:
Cash and cash equivalents, beginning of period$1,668,742 $644,950 
Cash held in escrows, beginning of period50,587 46,936 
Cash and cash equivalents and cash held in escrows, beginning of period$1,719,329 $691,886 
Cash and cash equivalents, end of period$697,369 $660,733 
Cash held in escrows, end of period251,814 197,845 
Cash and cash equivalents and cash held in escrows, end of period$949,183 $858,578 
Supplemental disclosures:
Cash paid for interest$146,781 $114,696 
Interest capitalized$12,032 $14,149 
Non-cash investing and financing activities:
Write-off of fully depreciated real estate$(23,847)$(38,782)
Change in real estate included in accounts payable and accrued expenses$(42,778)$(27,415)
Preferred stock redemption liability$200,000 $
Accrued rental income, net deconsolidated$$(4,558)
Tenant leasing costs, net deconsolidated$$(3,462)
Building and other capital improvements, net deconsolidated$$(111,889)
Tenant improvements, net deconsolidated$$(12,331)
Investment in unconsolidated joint venture recorded upon deconsolidation$$347,898 
Deferred distributions from sale of investment in unconsolidated joint venture$5,808 $
Deferred proceeds from sale of investment in unconsolidated joint venture$200 $
Distributions declared but not paid$171,003 $171,026 
Conversions of redeemable partnership units to partners’ capital$4,198 $15,495 
Issuance of restricted securities to employees and non-employee directors$41,255 $43,104 

BOSTON PROPERTIES LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF CAPITAL AND NONCONTROLLING INTERESTS
(unaudited and in thousands)
UnitsCapital
 General PartnerLimited PartnerPartners’ Capital (General and Limited Partners)Preferred UnitsAccumulated
Other
Comprehensive Loss
Noncontrolling
Interests - Property Partnerships
Total CapitalNoncontrolling Interests - Redeemable Partnership Units
Equity, December 31, 20201,731 153,988 $4,554,639 $193,623 $(49,890)$1,726,933 $6,425,305 $1,643,024 
Net activity from contributions and unearned compensation255 21,900 — — — 21,900 39,332 
Allocated net income for the period— — 324,652 2,560 — 52,602 379,814 35,393 
Distributions— — (459,048)(2,560)— — (461,608)(51,743)
Preferred unit redemption— — — (193,623)— — (193,623)— 
Preferred unit redemption charge— — (6,412)— — — (6,412)— 
Conversion of redeemable partnership units227 8,033 — — — 8,033 (8,033)
Adjustment to reflect redeemable partnership units at redemption value— — (234,647)— — — (234,647)234,647 
Effective portion of interest rate contracts— — — — 4,943 — 4,943 539 
Amortization of interest rate contracts— — — — 4,144 432 4,576 452 
Contributions from noncontrolling interests in property partnerships— — — — — 13,738 13,738 — 
Distributions to noncontrolling interests in property partnerships— — — — — (65,604)(65,604)— 
Equity, September 30, 20211,737 154,470 $4,209,117 $— $(40,803)$1,728,101 $5,896,415 $1,893,611 
Equity, December 31, 20191,727 153,063 $3,380,175 $193,623 $(48,335)$1,728,689 $5,254,152 $2,468,753 
Cumulative effect of a change in accounting principle
— — (1,505)— — — (1,505)(174)
Net activity from contributions and unearned compensation73 10,405 — — — 10,405 32,278 
Allocated net income for the period— — 872,842 7,875 — 34,280 914,997 97,090 
Distributions— — (457,233)(7,875)— — (465,108)(51,821)
Conversion of redeemable partnership units769 26,682 — — — 26,682 (26,682)
Adjustment to reflect redeemable partnership units at redemption value— — 1,112,483 — — — 1,112,483 (1,112,483)
Effective portion of interest rate contracts— — — — (8,416)— (8,416)(936)
Amortization of interest rate contracts— — — — 4,129 432 4,561 459 
Contributions from noncontrolling interests in property partnerships— — — — — 7,364 7,364 — 
Distributions to noncontrolling interests in property partnerships— — — — — (40,091)(40,091)— 
Equity, September 30, 20201,731 153,905 $4,943,849 $193,623 $(52,622)$1,730,674 $6,815,524 $1,406,484 


The accompanying notes are an integral part of these consolidated financial statements.
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BOSTON PROPERTIES LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited and in thousands)
 Nine months ended September 30,
 20212020
Cash flows from operating activities:
Net income$415,207 $1,012,087 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization533,255 510,400 
Amortization of right of use assets - operating leases3,208 1,667 
Non-cash compensation expense43,098 36,152 
Loss from unconsolidated joint ventures1,745 5,410 
Distributions of net cash flow from operations of unconsolidated joint ventures18,462 22,285 
Gains from investments in securities(3,744)(965)
Allowance for current expected credit losses(758)1,997 
Non-cash portion of interest expense17,584 17,397 
Settlement of accreted debt discount on redemption of unsecured senior notes(6,290)— 
Losses from early extinguishments of debt898 — 
Gains on sales of real estate(8,104)(626,686)
Change in assets and liabilities:
Tenant and other receivables, net13,738 18,543 
Notes receivable, net(419)(395)
Accrued rental income, net(74,283)(85,843)
Prepaid expenses and other assets(61,019)(60,365)
Lease liabilities - operating leases(24,023)1,157 
Accounts payable and accrued expenses26,097 8,273 
Accrued interest payable(18,237)(1,202)
Other liabilities(51,938)(24,868)
Tenant leasing costs(37,618)(52,621)
Total adjustments371,652 (229,664)
Net cash provided by operating activities786,859 782,423 
Cash flows from investing activities:
Acquisitions of real estate(218,679)(135,698)
Construction in progress(381,104)(358,824)
Building and other capital improvements(103,840)(116,894)
Tenant improvements(218,878)(172,401)
Proceeds from sales of real estate— 505,679 
Capital contributions to unconsolidated joint ventures(95,462)(158,374)
Capital distributions from unconsolidated joint ventures122 55,123 
Proceeds from sale of investment in unconsolidated joint venture17,789 — 
Issuance of notes receivable, net— (9,800)
Investments in securities, net1,684 2,778 
Net cash used in investing activities(998,368)(388,411)
Cash flows from financing activities:
Repayments of mortgage notes payable(13,261)(12,795)
Proceeds from unsecured senior notes1,695,996 1,248,125 
Redemption of unsecured senior notes(843,710)— 
Borrowings on unsecured line of credit300,000 265,000 
Repayments of unsecured line of credit(300,000)(265,000)
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BOSTON PROPERTIES LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited and in thousands)
 Nine months ended September 30,
 20212020
Repayment of unsecured term loan(500,000)— 
Redemption of preferred units(200,000)— 
Payments on finance lease obligations1,250 — 
Deferred financing costs(20,770)(10,416)
Debt prepayment and extinguishment costs(185)— 
Net proceeds from equity transactions20,028 3,276 
Distributions(513,381)(516,572)
Contributions from noncontrolling interests in property partnerships13,738 7,364 
Distributions to noncontrolling interests in property partnerships(65,604)(40,091)
Net cash provided by (used in) financing activities(425,899)678,891 
Net increase (decrease) in cash and cash equivalents and cash held in escrows(637,408)1,072,903 
Cash and cash equivalents and cash held in escrows, beginning of period1,719,329 691,886 
Cash and cash equivalents and cash held in escrows, end of period$1,081,921 $1,764,789 
Reconciliation of cash and cash equivalents and cash held in escrows:
Cash and cash equivalents, beginning of period$1,668,742 $644,950 
Cash held in escrows, beginning of period50,587 46,936 
Cash and cash equivalents and cash held in escrows, beginning of period$1,719,329 $691,886 
Cash and cash equivalents, end of period$1,002,728 $1,714,783 
Cash held in escrows, end of period79,193 50,006 
Cash and cash equivalents and cash held in escrows, end of period$1,081,921 $1,764,789 
Supplemental disclosures:
Cash paid for interest$358,015 $335,591 
Interest capitalized$36,632 $41,329 
Non-cash investing and financing activities:
Write-off of fully depreciated real estate$(157,794)$(73,584)
Change in real estate included in accounts payable and accrued expenses$(22,104)$(30,924)
Right-of-use assets obtained in exchange for lease liabilities$26,887 $— 
Accrued rental income, net deconsolidated$— $(4,558)
Tenant leasing costs, net deconsolidated$— $(3,462)
Building and other capital improvements, net deconsolidated$— $(111,889)
Tenant improvements, net deconsolidated$— $(12,331)
Investment in unconsolidated joint venture recorded upon deconsolidation$— $347,898 
Distributions declared but not paid$169,739 $171,070 
Conversions of redeemable partnership units to partners’ capital$8,033 $26,682 
Issuance of restricted securities to employees and non-employee directors$44,257 $43,244 


The accompanying notes are an integral part of these consolidated financial statements.
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BOSTON PROPERTIES, INC. AND BOSTON PROPERTIES LIMITED PARTNERSHIP
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. Organization
Boston Properties, Inc., a Delaware corporation, is a fully integrated, self-administered and self-managed real estate investment trust (“REIT”). Boston Properties, Inc. is the sole general partner of Boston Properties Limited Partnership, its operating partnership, and at March 31,September 30, 2021 owned an approximate 89.9% (90.0% at December 31, 2020) general and limited partnership interest in Boston Properties Limited Partnership. Unless stated otherwise or the context requires, the “Company” refers to Boston Properties, Inc. and its subsidiaries, including Boston Properties Limited Partnership and its consolidated subsidiaries. Partnership interests in Boston Properties Limited Partnership include:
common units of partnership interest (also referred to as “OP Units”),
long term incentive units of partnership interest (also referred to as “LTIP Units”), and
preferred units of partnership interest (also referred to as “Preferred Units”).
Unless specifically noted otherwise, all references to OP Units exclude units held by Boston Properties, Inc. A holder of an OP Unit may present such OP Unit to Boston Properties Limited Partnership for redemption at any time (subject to restrictions agreed upon at the time of issuance of OP Units to particular holders that may restrict such redemption right for a period of time, generally 1 year from issuance). Upon presentation of an OP Unit for redemption, Boston Properties Limited Partnership is obligated to redeem the OP Unit for cash equal to the value of a share of common stock of Boston Properties, Inc. (“Common Stock”). In lieu of a cash redemption, Boston Properties, Inc. may elect to acquire the OP Unit for 1 share of Common Stock. Because the number of shares of Common Stock outstanding at all times equals the number of OP Units that Boston Properties, Inc. owns, 1 share of Common Stock is generally the economic equivalent of 1 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.
The Company uses LTIP Units as a form of time-based, restricted equity compensation and as a form of performance-based equity compensation for employees, and has previously granted LTIP Units in the form of (1) 2012 outperformance plan awards (“2012 OPP Units”) and (2) 2013 - 2021 multi-year, long-term incentive program awards (also referred to as “MYLTIP Units”), each of which, upon the satisfaction of certain performance and vesting conditions, is convertible into one OP Unit. The three-year measurement periods for the 2012 OPP Units and the 2013 - 2018 MYLTIP Units have ended and Boston Properties, Inc.’s total stockholder return (“TSR”) was sufficient for employees to earn and therefore become eligible to vest in a portion of the awards. Unless and until they are earned, the rights, preferences and privileges of the 2019 - 2021 MYLTIP Units differ from other LTIP Units granted to employees (including the 2012 OPP Units and the 2013 - 2018 MYLTIP Units, which have been earned). Therefore, unless specifically noted otherwise, all references to LTIP Units exclude the 2019 - 2021 MYLTIP Units. LTIP Units (including the earned 2012 OPP Units and the earned 2013 - 2018 MYLTIP Units), whether vested or not, will receive the same quarterly per unit distributions as OP Units, which equal per share dividends on Common Stock (See Notes 10 and 14).
At December 31, 2020, there was 1 series of Preferred Units outstanding (i.e., Series B Preferred Units). The Series B Preferred Units were issued to Boston Properties, Inc. on March 27, 2013 in connection with the issuance of 80,000 shares (8,000,000 depositary shares each representing 1/100th of a share) of 5.25% Series B Cumulative Redeemable Preferred Stock (the “Series B Preferred Stock”). Boston Properties, Inc. contributed the net proceeds from the offering to Boston Properties Limited Partnership in exchange for 80,000 Series B Preferred Units having terms and preferences generally mirroring those of the Series B Preferred Stock (See Note 11).Stock. On March 2, 2021, Boston Properties, Inc. issued a redemption notice for 80,000 shares of Series B Preferred Stock, which constituted all of the outstanding Series B Preferred Stock, and the corresponding depositary shares, each representing 1/100th of a share of Series B Preferred Stock (the “Depositary Shares”), and recorded it as a liability. Upon redemption of the Series B Preferred Stock, the Series B Preferred Units were also redeemed. On March 31, 2021, Boston Properties, Inc. transferred the full redemption price for all outstanding shares of Series B Preferred Stock of approximately $201.3 million, including approximately $1.3 million of accrued and unpaid dividends to, but not including, the redemption date, to the redemption agentagent. On April 1, 2021, Boston Properties, Inc. redeemed 80,000 shares of Series B Preferred Stock (including the corresponding 8,000,000 Depositary Shares), which represented all of the outstanding shares of Series B Preferred Stock and recordedall of the amount within Cash held in escrows onoutstanding Depositary Shares. In connection with the Consolidated Balance Sheetredemption of the Series B Preferred Stock, the Series B Preferred Units were also redeemed (See Notes 11 and 15)Note 11).
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Properties
At March 31,September 30, 2021, the Company owned or had joint venture interests in a portfolio of 196202 commercial real estate properties (the “Properties”) aggregating approximately 51.652.5 million net rentable square feet of primarily Class A office properties, including 9 properties under construction/redevelopment totaling approximately 4.3 million net rentable square feet. At March 31,September 30, 2021, the Properties consisted of:
177183 office properties (including 9 properties under construction/redevelopment);
12 retail properties;
6 residential properties; and
1 hotel.
The Company considers Class A office properties to be well-located buildings that are modern structures or have been modernized to compete with newer buildings and professionally managed and maintained. As such, these properties attract high-quality tenants and command upper-tier rental rates.
2. Basis of Presentation and Summary of Significant Accounting Policies
Boston Properties, Inc. does not have any other significant assets, liabilities or operations, other than its investment in Boston Properties Limited Partnership, nor does it have employees of its own. Boston Properties Limited Partnership, not Boston Properties, Inc., generally executes all significant business relationships other than transactions involving securities of Boston Properties, Inc. All majority-owned subsidiaries and joint ventures over which the Company has financial and operating control and variable interest entities (“VIEs”) in which the Company has determined it is the primary beneficiary are included in the consolidated financial statements. All significant intercompany balances and transactions have been eliminated in consolidation. The Company accounts for all other unconsolidated joint ventures using the equity method of accounting. Accordingly, the Company’s share of the earnings of these joint ventures and companies is included in consolidated net income.
The accompanying interim financial statements are unaudited; however, the financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) for interim financial information and in conjunction with the rules and regulations of the Securities and Exchange Commission. Accordingly, they do not include all of the disclosures required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting solely of normal recurring matters) necessary for a fair statement of the financial statements for these interim periods have been included. The results of operations for the interim periods are not necessarily indicative of the results to be obtained for other interim periods or for the full fiscal year. The year-end consolidated balance sheet data was derived from audited financial statements, but does not include all disclosure required by GAAP.  These financial statements should be read in conjunction with the Company’s financial statements and notes thereto contained in the Company’s Annual Report in the Company’s Form 10-K for its fiscal year ended December 31, 2020.
The Company bases its estimates on historical experience and on various other assumptions that it considers to be reasonable under the circumstances, including the impact of extraordinary events such as the novel coronavirus (“COVID-19”) pandemic, the results of which form the basis for making significant judgments about the carrying values of assets and liabilities, assessments of future collectability, and other areas of the financial statements that are impacted by the use of estimates. Actual results may differ from these estimates under different assumptions or conditions.
Variable Interest Entities (VIEs)
Consolidated VIEs are those for which the Company is considered to be the primary beneficiary of a VIE. The primary beneficiary is the entity that has a controlling financial interest in the VIE, which is defined by the entity having both of the following characteristics: (1) the power to direct the activities that, when taken together, most significantly impact the VIE’s performance and (2) the obligation to absorb losses or the right to receive the returns from the VIE that could potentially be significant to the VIE. The Company has determined that it is the primary beneficiary for 6 of the 7 entities that are VIEs.
Consolidated Variable Interest Entities
As of March 31,September 30, 2021, Boston Properties, Inc. has identified 6 consolidated VIEs, including Boston Properties Limited Partnership. Excluding Boston Properties Limited Partnership, the VIEs consisted of the following 5 in-service properties: 767 Fifth Avenue (the General Motors Building), Times Square Tower, 601 Lexington Avenue, Atlantic Wharf Office Building and 100 Federal Street.
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The Company consolidates these VIEs because it is the primary beneficiary.  The third parties’ interests in these consolidated entities (excluding Boston Properties Limited Partnership’s interest) are reflected as noncontrolling interests in property partnerships in the accompanying consolidated financial statements (See Note 10). 
In addition, Boston Properties, Inc.’s only significant asset is its investment in Boston Properties Limited Partnership and, consequently, substantially all of Boston Properties, Inc.’s assets and liabilities are the assets and liabilities of Boston Properties Limited Partnership.
Variable Interest Entities Not Consolidated
The Company has determined that the Platform 16 Holdings LP joint venture is a VIE. The Company does not consolidate this entity as the Company does not have the power to direct the activities that, when taken together, most significantly impact the VIE’s performance and, therefore, the Company is not considered to be the primary beneficiary.
Fair Value of Financial Instruments
The Company follows the authoritative guidance for fair value measurements when valuing its financial instruments for disclosure purposes. The table below presents the financial instruments that are being valued for disclosure purposes as well as the Level at which they are categorized (as defined in Accounting Standards Codification (“ASC”) 820 “Fair Value Measurements and Disclosures” (“ASC 820”)).
Financial InstrumentLevel
Unsecured senior notes (1)Level 1
Related party note receivableLevel 3
Notes receivableLevel 3
Mortgage notes payableLevel 3
Unsecured line of credit (2)Level 3
_______________
(1)If trading value for the period is low, the valuation could be categorized as Level 2.
(2)As of March 31,September 30, 2021, there were no amounts outstanding under the unsecured line of credit.
Because the Company’s valuations of its financial instruments are based on the above Levels and involve the use of estimates, the actual fair values of its financial instruments may differ materially from those estimates.
The following table identifies the range and weighted average of significant unobservable inputs for the Company’s Level 3 fair value measured instruments.
Financial InstrumentFinancial InstrumentLevelRangeWeighted AverageFinancial InstrumentLevelRangeWeighted Average
Related party note receivableRelated party note receivableLevel 33.61%Related party note receivableLevel 33.58%
Notes receivableNotes receivableLevel 33.60% - 8.00%5.85%Notes receivableLevel 33.54% - 8.00%5.78%
Mortgage notes payableMortgage notes payableLevel 32.75% - 3.07%2.82%Mortgage notes payableLevel 32.50% - 4.75%2.96%
In addition, theThe Company’s estimated fair values for these instruments as of the end of the applicable reporting period are not projections of, nor necessarily indicative of, estimated or actual fair values in future reporting periods.
The following table presents the aggregate carrying value of the Company’s related party note receivable, net, notes receivable, net, mortgage notes payable, net, unsecured senior notes, net, unsecured line of credit and unsecured term loan, net and the Company’s corresponding estimate of fair value as of March 31,September 30, 2021 and December 31, 2020 (in thousands):
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 March 31, 2021December 31, 2020
 Carrying
Amount
Estimated
Fair Value
Carrying
Amount
Estimated
Fair Value
Related party note receivable, net$77,640 $84,205 $77,552 $84,579 
Notes receivable, net18,891 19,541 18,729 19,372 
Total$96,531 $103,746 $96,281 $103,951 
Mortgage notes payable, net$2,904,672 $3,025,986 $2,909,081 $3,144,150 
Unsecured senior notes, net9,631,592 10,216,659 9,639,287 10,620,527 
Unsecured line of credit
Unsecured term loan, net499,390 500,326 
Total$12,536,264 $13,242,645 $13,047,758 $14,265,003 

 September 30, 2021December 31, 2020
 Carrying
Amount
Estimated
Fair Value
Carrying
Amount
Estimated
Fair Value
Related party note receivable, net$78,144 $83,354 $77,552 $84,579 
Notes receivable, net19,297 19,885 18,729 19,372 
Total$97,441 $103,239 $96,281 $103,951 
Mortgage notes payable, net$2,898,699 $3,032,122 $2,909,081 $3,144,150 
Unsecured senior notes, net10,479,651 11,157,602 9,639,287 10,620,527 
Unsecured line of credit— — — — 
Unsecured term loan, net— — 499,390 500,326 
Total$13,378,350 $14,189,724 $13,047,758 $14,265,003 
3. Real Estate
Boston Properties, Inc.
Real estate consisted of the following at March 31,September 30, 2021 and December 31, 2020 (in thousands):
March 31, 2021December 31, 2020September 30, 2021December 31, 2020
LandLand$5,068,843 $5,069,206 Land$5,065,704 $5,069,206 
Right of use assets - finance leasesRight of use assets - finance leases237,017 237,393 Right of use assets - finance leases237,845 237,393 
Right of use assets - operating leases(1)Right of use assets - operating leases(1)144,143 146,406 Right of use assets - operating leases(1)170,085 146,406 
Land held for future development (1)(2)Land held for future development (1)(2)421,349 450,954 Land held for future development (1)(2)568,034 450,954 
Buildings and improvementsBuildings and improvements14,004,418 13,777,691 Buildings and improvements14,118,587 13,777,691 
Tenant improvementsTenant improvements2,816,726 2,752,880 Tenant improvements2,853,531 2,752,880 
Furniture, fixtures and equipmentFurniture, fixtures and equipment51,549 49,606 Furniture, fixtures and equipment51,013 49,606 
Construction in progressConstruction in progress794,039 868,773 Construction in progress1,054,531 868,773 
TotalTotal23,538,084 23,352,909 Total24,119,330 23,352,909 
Less: Accumulated depreciationLess: Accumulated depreciation(5,665,061)(5,534,102)Less: Accumulated depreciation(5,850,397)(5,534,102)
$17,873,023 $17,818,807 $18,268,933 $17,818,807 
_______________
(1)See Note 4.
(2)Includes pre-development costs.
Boston Properties Limited Partnership
Real estate consisted of the following at March 31,September 30, 2021 and December 31, 2020 (in thousands):
March 31, 2021December 31, 2020September 30, 2021December 31, 2020
LandLand$4,971,990 $4,971,990 Land$4,968,851 $4,971,990 
Right of use assets - finance leasesRight of use assets - finance leases237,017 237,393 Right of use assets - finance leases237,845 237,393 
Right of use assets - operating leases(1)Right of use assets - operating leases(1)144,143 146,406 Right of use assets - operating leases(1)170,085 146,406 
Land held for future development (1)(2)Land held for future development (1)(2)421,349 450,954 Land held for future development (1)(2)568,034 450,954 
Buildings and improvementsBuildings and improvements13,725,776 13,498,098 Buildings and improvements13,839,945 13,498,098 
Tenant improvementsTenant improvements2,816,726 2,752,880 Tenant improvements2,853,531 2,752,880 
Furniture, fixtures and equipmentFurniture, fixtures and equipment51,549 49,606 Furniture, fixtures and equipment51,013 49,606 
Construction in progressConstruction in progress794,039 868,773 Construction in progress1,054,531 868,773 
TotalTotal23,162,589 22,976,100 Total23,743,835 22,976,100 
Less: Accumulated depreciationLess: Accumulated depreciation(5,557,784)(5,428,576)Less: Accumulated depreciation(5,739,625)(5,428,576)
$17,604,805 $17,547,524 $18,004,210 $17,547,524 
_______________
(1)See Note 4.
(2)Includes pre-development costs.
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Acquisitions
On June 2, 2021, the Company acquired 153 & 211 Second Avenue located in Waltham, Massachusetts for an aggregate purchase price of approximately $100.2 million in cash. 153 & 211 Second Avenue consists of 2 life sciences lab buildings totaling approximately 137,000 net rentable square feet. The properties are 100% leased. The following table summarizes the allocation of the purchase price, including transaction costs, of 153 & 211 Second Avenue at the date of acquisition (in thousands):
Land$33,233 
Building and improvements53,309 
Tenant improvements2,631 
In-place lease intangibles13,415 
Below-market lease intangibles(2,412)
Net assets acquired$100,176 
The following table summarizes the estimated annual amortization of the acquired in-place lease intangibles
and the acquired below-market lease intangibles for 153 & 211 Second Avenue for the remainder of 2021 through the last lease expiration (in thousands):

Acquired In-Place Lease IntangiblesAcquired Below-Market Lease Intangibles
Period from June 2, 2021 through December 31, 2021$5,202 $935 
20228,213 1,477 
153 & 211 Second Avenue contributed approximately $3.1 million of revenue and approximately ($1.2) million of earnings to the Company for the period from June 2, 2021 through September 30, 2021.
On August 2, 2021, the Company acquired Shady Grove Bio+Tech Campus in Rockville, Maryland, for a purchase price, including transaction costs, of approximately $118.5 million in cash. Shady Grove Bio+Tech Campus is an approximately 435,000 net rentable square foot, 7-building office park situated on an approximately 31-acre site. The Company intends to reposition three of the buildings, which are currently vacant, to support lab or life sciences uses. As a result, the three vacant buildings are not part of the Company’s in-service portfolio. The Company anticipates that it will redevelop or convert the remaining four buildings to lab or life sciences-related uses as each becomes vacant. The following table summarizes the allocation of the purchase price, including transaction costs, of Shady Grove Bio+Tech Campus at the date of acquisition (in thousands):
Land$52,030 
Building and improvements63,060 
Tenant improvements1,152 
In-place lease intangibles2,523 
Above-market lease intangibles142 
Below-market lease intangibles(403)
Net assets acquired$118,504 
The following table summarizes the estimated annual amortization of the acquired in-place lease intangibles
and the acquired above/below-market lease intangibles for Shady Grove Bio+Tech Campus from August 2, 2021 through the last lease expiration (in thousands):

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Acquired In-Place Lease IntangiblesAcquired Above-Market Lease IntangiblesAcquired Below-Market Lease Intangibles
Period from August 2, 2021 through December 31, 2021$838 $31 $102 
20221,478 74 236 
2023151 25 39 
202456 12 26 
Shady Grove Bio+Tech Campus contributed approximately $0.5 million of revenue and approximately $(0.6) million of earnings to the Company for the period from August 2, 2021 through September 30, 2021.
Pending Acquisitions
On April 19, 2021, the Company entered into an agreement to acquire 11251 Roger Bacon Drive, in Reston, Virginia, for an aggregate purchase price of approximately $5.6 million. The closing is scheduled to occur in the first quarter of 2022. 11251 Roger Bacon Drive is an approximately 65,000 square foot office building situated on approximately 2.6 acres. The property is 100% leased to a single tenant with a lease that expires concurrently with the planned closing. There can be no assurance that this transaction will be consummated on the terms currently contemplated or at all.
On June 25, 2021, the Company entered into an agreement to acquire 360 Park Avenue South in New York City, New York for an aggregate purchase price of approximately $300.0 million, including (1) the assumption of the mortgage loan collateralized by the property totaling approximately $202.0 million and (2) the issuance of approximately $98.0 million of OP Units, with a floor price of $111.00 per OP Unit. The closing is scheduled to occur in the fourth quarter of 2021. The Company’s deposit of $30.0 million is reflected as Cash Held in Escrows in the Company’s Consolidated Balance Sheets. 360 Park Avenue South is an approximately 450,000 square foot Class A office building. Upon acquisition, the building will be vacant and the Company intends to redevelop or reposition the building. There can be no assurance that the acquisition will be consummated on the terms currently contemplated or at all.
Developments
On February 1, 2021, the consolidated entity in which the Company has a 55% interest completed and fully placed in-service One Five Nine East 53rd Street, a Class A office and retail redevelopment of the low-rise portion of its 601 Lexington Avenue property with approximately 220,000 net rentable square feet located in New York City.
On February 25, 2021, the Company commenced the development of 180 CityPoint, located in Waltham, Massachusetts. When completed, the building will consist of approximately 329,000 net rentable square feet of laboratory space.
On February 25, 2021, the Company commenced the redevelopment of 880 Winter Street, located in Waltham, Massachusetts. When completed, the building will consist of approximately 224,000 net rentable square feet of laboratory space.
On February 25, 2021, the Company commenced the redevelopment of View Boston Observatory at The Prudential Center, Observatory, a 59,000 net rentable square foot redevelopment of the top three floors of 800 Boylston Street - The Prudential Center, located in Boston, Massachusetts.
On April 16, 2021, the Company removed 3625-3635 Peterson Way from its in-service portfolio following the lease expiration of the last tenant on April 15, 2021. The Company is demolishing the building and may redevelop the site at a future date. 3625-3635 Peterson Way is an approximately 218,000 net rentable square foot Class A office building located in Santa Clara, California.
Dispositions
On December 13, 2018, the Company sold its 6595 Springfield Center Drive development project located in Springfield, Virginia. Concurrently with the sale, the Company agreed to act as development manager and guaranteed the completion of the project (See Note 9). The development project achieved final completion during the third quarter of 2021 and, upon completion of the project, the total cost of development was determined to be
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below the estimated total investment at the time of sale. As a result, the Company recognized a gain on sale of real estate of approximately $8.1 million during the nine months ended September 30, 2021.
On July 13, 2021, the Company entered into an agreement to sell its 181,191 and 201 Spring Street properties located in Lexington, Massachusetts for an aggregate gross sales price of $191.5 million. 181,191 and 201 Spring Street are three Class A office properties aggregating approximately 333,000 net rentable square feet and are 100% leased (See Note 15).
4. Leases
The Company must make estimates as to the collectability of its accrued rent and accounts receivable balances related to lease revenue. Management analyzesWhen evaluating the collectability of tenants’ accrued rent and accounts receivable by consideringbalances, management considers tenant creditworthiness, current economic trends, including the impact of COVID-19 on tenants’ businesses, and changes in tenants’ payment patterns, when evaluating the collectability of the tenant’s receivable balance, including the accrued rent receivable, on a lease-by-lease basis. As a result, of this analysis, during thenine months ended September 30, 2021, the Company wrote off approximately $1.3 million related to accrued rent, net balances and accounts receivable, net balances. There were no write-offs related to accrued rent, net balances and accounts receivable, net balances for the three months ended March 31, 2021September 30, 2021. During the three and nine months ended September 30, 2020, the Company wrote off approximately $0.6$7.5 million and $1.2$63.8 million, respectively, related to accrued rent, net balances and approximately $(0.2) million and $0.3 million, respectively, related to accounts receivable, net balances. The write-offs were for tenants, primarily in the retail sector, that either terminated their leases or thatfor which the Company considereddetermined their accrued rent and/or accounts receivable balances were no longer probable of collection.
Lessee
On May 19, 2021, the Company amended its ground lease at Sumner Square in Washington, DC. The amendment extends the ground lease for an additional 15 years. Prior to the amendment, the ground lease was scheduled to expire on August 10, 2066. The ground lease will now expire on August 9, 2081. The lease requires the Company to pay $23.0 million in 2021 and requires the Company’s remaining obligation of approximately $4.0 million be used to fund certain operation and maintenance costs incurred by the government with respect to the Sumner School for the next five years, with no payments thereafter. The Company’s incremental borrowing rate is 3.95% per annum. The net present value of the total ground lease payments is approximately $26.7 million. The Company continues to classify this ground lease as an operating lease. As a result, the Company recorded a Right-of-Use Assets - Operating Leases and Lease Liabilities - Operating Leases of approximately $27.1 million and $26.7 million, respectively, on its Consolidated Balance Sheet. On July 1, 2021, the Company made the $23.0 million payment. The Sumner Square ground lease had operating lease costs of approximately $0.1 million and $0.3 million for the three months ended September 30, 2021 and 2020, respectively, and approximately $0.6 million and $1.0 million for the nine months ended September 30, 2021 and 2020, respectively. Sumner Square is an approximately 210,000 net rentable square foot Class A office building.
The following table provides a maturity analysis for the Company’s lease liabilities related to its Sumner Square operating lease as of May 19, 2021 (in thousands):
Operating
Period from May 19, 2021 through December 31, 2021$23,599 
2022761 
2023784 
2024808 
2025832 
2026422 
Thereafter— 
Total lease payments27,206 
Less: Interest portion(536)
Present value of lease payments$26,670 
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Lessor
The following table summarizes the components of lease revenue recognized during the three and nine months ended March 31,September 30, 2021 and 2020 included within the Company's Consolidated Statements of Operations (in thousands):
Three months ended March 31,Three months ended September 30,Nine months ended September 30,
Lease RevenueLease Revenue20212020Lease Revenue2021202020212020
Fixed contractual paymentsFixed contractual payments$575,353 $586,957 Fixed contractual payments$581,393 $557,384 $1,732,930 $1,673,855 
Variable lease paymentsVariable lease payments110,464 123,154 Variable lease payments110,867 109,290 329,172 333,049 
$685,817 $710,111 $692,260 $666,674 $2,062,102 $2,006,904 
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5. Investments in Unconsolidated Joint Ventures
The investments in unconsolidated joint ventures consist of the following at March 31,September 30, 2021 and December 31, 2020:
 Carrying Value of Investment (1) Carrying Value of Investment (1)
EntityEntityPropertiesNominal %
Ownership
March 31,
2021
December 31,
2020
EntityPropertiesNominal % OwnershipSeptember 30,
2021
December 31,
2020
(in thousands)(in thousands)
Square 407 Limited PartnershipSquare 407 Limited PartnershipMarket Square North50.0 %$(3,293)$(3,766)Square 407 Limited PartnershipMarket Square North50.00 %$(1,917)$(3,766)
BP/CRF Metropolitan Square LLCBP/CRF Metropolitan Square LLCMetropolitan Square20.0 %(12,971)(13,584)BP/CRF Metropolitan Square LLCMetropolitan Square20.00 %(14,568)(13,584)
901 New York, LLC901 New York, LLC901 New York Avenue25.0 %(2) (12,198)(12,264)901 New York, LLC901 New York Avenue25.00 %(2) (12,390)(12,264)
WP Project Developer LLCWP Project Developer LLCWisconsin Place Land and Infrastructure33.3 %(3) 34,887 35,297 WP Project Developer LLCWisconsin Place Land and Infrastructure33.33 %(3) 34,104 35,297 
Annapolis Junction NFM LLCAnnapolis Junction NFM LLCAnnapolis Junction50.0 %(4) — 13,463 Annapolis Junction NFM LLCAnnapolis Junction50.00 %(4) N/A13,463 
540 Madison Venture LLC540 Madison Venture LLC540 Madison Avenue60.0 %(5) — 122 540 Madison Venture LLC540 Madison Avenue60.00 %(5) — 122 
500 North Capitol Venture LLC500 North Capitol Venture LLC500 North Capitol Street, NW30.0 %(7,187)(6,945)500 North Capitol Venture LLC500 North Capitol Street, NW30.00 %(7,700)(6,945)
501 K Street LLC501 K Street LLC1001 6th Street50.0 %(6) 42,607 42,499 501 K Street LLC1001 6th Street50.00 %(6) 42,669 42,499 
Podium Developer LLCPodium Developer LLCThe Hub on Causeway - Podium50.0 %48,398 48,818 Podium Developer LLCThe Hub on Causeway - Podium50.00 %48,970 48,818 
Residential Tower Developer LLCResidential Tower Developer LLCHub50House50.0 %49,520 50,943 Residential Tower Developer LLCHub50House50.00 %47,934 50,943 
Hotel Tower Developer LLCHotel Tower Developer LLCThe Hub on Causeway - Hotel Air Rights50.0 %11,032 10,754 Hotel Tower Developer LLCThe Hub on Causeway - Hotel Air Rights50.00 %11,402 10,754 
Office Tower Developer LLCOffice Tower Developer LLC100 Causeway Street50.0 %56,458 56,312 Office Tower Developer LLC100 Causeway Street50.00 %56,714 56,312 
1265 Main Office JV LLC1265 Main Office JV LLC1265 Main Street50.0 %3,899 3,787 1265 Main Office JV LLC1265 Main Street50.00 %3,855 3,787 
BNY Tower Holdings LLCBNY Tower Holdings LLCDock 7250.0 %27,936 29,536 BNY Tower Holdings LLCDock 7250.00 %28,079 29,536 
BNYTA Amenity Operator LLCBNYTA Amenity Operator LLCDock 7250.0 %1,672 1,846 BNYTA Amenity Operator LLCDock 7250.00 %1,151 1,846 
CA-Colorado Center Limited PartnershipCA-Colorado Center Limited PartnershipColorado Center50.0 %229,094 227,671 CA-Colorado Center Limited PartnershipColorado Center50.00 %230,535 227,671 
7750 Wisconsin Avenue LLC7750 Wisconsin Avenue LLC7750 Wisconsin Avenue50.0 %58,697 58,112 7750 Wisconsin Avenue LLC7750 Wisconsin Avenue50.00 %59,734 58,112 
BP-M 3HB Venture LLCBP-M 3HB Venture LLC3 Hudson Boulevard25.0 %115,869 113,774 BP-M 3HB Venture LLC3 Hudson Boulevard25.00 %116,537 113,774 
SMBP Venture LPSMBP Venture LPSanta Monica Business Park55.0 %159,545 145,761 SMBP Venture LPSanta Monica Business Park55.00 %155,679 145,761 
Platform 16 Holdings LPPlatform 16 Holdings LPPlatform 1655.0 %(7)108,358 108,393 Platform 16 Holdings LPPlatform 1655.00 %(7)108,098 108,393 
Gateway Portfolio Holdings LLCGateway Portfolio Holdings LLCGateway Commons50.0 %(8)332,591 336,206 Gateway Portfolio Holdings LLCGateway Commons50.00 %(8)328,367 336,206 
Rosecrans-Sepulveda Partners 4, LLCRosecrans-Sepulveda Partners 4, LLCBeach Cities Media Campus50.0 %27,162 27,184 Rosecrans-Sepulveda Partners 4, LLCBeach Cities Media Campus50.00 %27,124 27,184 
Safeco Plaza REIT LLCSafeco Plaza REIT LLCSafeco Plaza33.67 %(9)72,570 N/A
$1,272,076 $1,273,919 $1,336,947 $1,273,919 
 _______________
(1)Investments with deficit balances aggregating approximately $35.6 million and $36.6 million at March 31,September 30, 2021 and December 31, 2020 respectively, are included within Other Liabilities in the Company’s Consolidated Balance Sheets.
(2)The Company’s economic ownership has increased based on the achievement of certain return thresholds. At March 31,September 30, 2021 and December 31, 2020, the Company’s economic ownership was approximately 50%.
(3)The Company’s wholly-owned subsidiary that owns Wisconsin Place Office also owns a 33.3%33.33% interest in the joint venture entity that owns the land, parking garage and infrastructure of the project.
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(4)On March 30, 2021, the Company sold its interest in the joint venture to the partner. See below for additional details.
(5)The property was sold on June 27, 2019. As of December 31, 2020, the investment consisted of undistributed cash. All remaining cash has been distributed as of March 31,September 30, 2021.
(6)Under the joint venture agreement for this land parcel, the partner will be entitled to up to 2 additional payments from the venture based on increases in total entitled square footage of the project above 520,000 square feet and achieving certain project returns at stabilization.
(7)This entity is a VIE (See Note 2).
(8)As a result of the partner’s deferred contribution, the Company owned an approximately 54%52% and 55% interest in the joint venture at March 31,September 30, 2021 and December 31, 2020, respectively. Future development projects will be owned 49% by
(9)The Company’s ownership includes (1) a 33.0% direct interest in the Companyjoint venture, and 51% by(2) an additional 1% interest in each of the two entities (each, a “Safeco Partner Entity”) through which each partner owns its partner.interest in the joint venture.
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Certain of the Company’s unconsolidated joint venture agreements include provisions whereby, at certain specified times, each partner has the right to initiate a purchase or sale of its interest in the joint ventures. With limited exceptions under these provisions, the Company is not compelled to purchase the interest of its outside joint venture partners. Under certain of the Company’s joint venture agreements, if certain return thresholds are achieved, the partners or the Company will be entitled to an additional promoted interest or payments.
The combined summarized balance sheets of the Company’s unconsolidated joint ventures are as follows: 
March 31,
2021
December 31,
2020
September 30,
2021
December 31,
2020
(in thousands) (in thousands)
ASSETSASSETSASSETS
Real estate and development in process, net (1)Real estate and development in process, net (1)$4,711,593 $4,708,571 Real estate and development in process, net (1)$5,244,585 $4,708,571 
Other assetsOther assets505,554 531,071 Other assets561,722 531,071 
Total assetsTotal assets$5,217,147 $5,239,642 Total assets$5,806,307 $5,239,642 
LIABILITIES AND MEMBERS’/PARTNERS’ EQUITYLIABILITIES AND MEMBERS’/PARTNERS’ EQUITYLIABILITIES AND MEMBERS’/PARTNERS’ EQUITY
Mortgage and notes payable, netMortgage and notes payable, net$2,662,616 $2,637,911 Mortgage and notes payable, net$2,995,161 $2,637,911 
Other liabilities (2)Other liabilities (2)599,354 650,433 Other liabilities (2)639,980 650,433 
Members’/Partners’ equityMembers’/Partners’ equity1,955,177 1,951,298 Members’/Partners’ equity2,171,166 1,951,298 
Total liabilities and members’/partners’ equityTotal liabilities and members’/partners’ equity$5,217,147 $5,239,642 Total liabilities and members’/partners’ equity$5,806,307 $5,239,642 
Company’s share of equityCompany’s share of equity$933,739 $936,087 Company’s share of equity$995,995 $936,087 
Basis differentials (3)Basis differentials (3)338,337 337,832 Basis differentials (3)340,952 337,832 
Carrying value of the Company’s investments in unconsolidated joint ventures (4)Carrying value of the Company’s investments in unconsolidated joint ventures (4)$1,272,076 $1,273,919 Carrying value of the Company’s investments in unconsolidated joint ventures (4)$1,336,947 $1,273,919 
_______________
(1)At March 31,September 30, 2021 and December 31, 2020, this amount included right of use assets - finance leases totaling approximately $248.9 million, and $248.9 million, respectively, and right of use assets - operating leases totaling approximately $22.2$22.6 million and $22.5 million, respectively.
(2)At March 31,September 30, 2021 and December 31, 2020, this amount included lease liabilities - finance leases totaling approximately $387.9$386.3 million and $388.7 million, respectively, and lease liabilities - operating leases totaling approximately $29.2$30.4 million and $29.0 million, respectively.
(3)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 assets and liabilities. Basis differentials result from impairments of investments, acquisitions through joint ventures with no change in control and upon the transfer of assets that were previously owned by the Company into a joint venture. In addition, certain acquisition, transaction and other costs may not be reflected in the net assets at the joint venture level. The majority of the Company’s basis differences are as follows:
March 31,
2021
December 31,
2020
(in thousands)September 30,
2021
December 31,
2020
PropertyPropertyProperty(in thousands)
Colorado CenterColorado Center$306,903 $307,328 Colorado Center$305,236 $307,328 
Gateway CommonsGateway Commons50,682 51,875 Gateway Commons51,566 51,875 
Dock 72Dock 72(51,708)(52,243)Dock 72(50,599)(52,243)
These basis differentials (excluding land) will be amortized over the remaining lives of the related assets and liabilities.
(4)Investments with deficit balances aggregating approximately $35.6 million and $36.6 million at March 31,September 30, 2021 and December 31, 2020 respectively, are reflected within Other Liabilities in the Company’s Consolidated Balance Sheets.
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The combined summarized statements of operations of the Company’s unconsolidated joint ventures are as follows: 
Three months ended March 31, Three months ended September 30,Nine months ended September 30,
20212020 2021202020212020
(in thousands) (in thousands)
Total revenue (1)Total revenue (1)$87,266 $93,203 Total revenue (1)$90,009 $87,724 $268,501 $270,490 
ExpensesExpensesExpenses
OperatingOperating37,134 35,401 Operating40,378 37,572 114,299 106,677 
Transaction costsTransaction costsTransaction costs— — — 
Depreciation and amortizationDepreciation and amortization34,103 32,035 Depreciation and amortization36,036 35,810 103,766 105,235 
Total expensesTotal expenses71,244 67,436 Total expenses76,414 73,382 218,072 211,912 
Other income (expense)Other income (expense)Other income (expense)
Interest expenseInterest expense(25,556)(22,583)Interest expense(27,519)(25,481)(78,711)(71,370)
Net income (loss)$(9,534)$3,184 
Gains on sales of real estateGains on sales of real estate— — — 11,720 
Net lossNet loss$(13,924)$(11,139)$(28,282)$(1,072)
Company’s share of net income (loss)Company’s share of net income (loss)$(3,640)$1,252 Company’s share of net income (loss)$(4,491)$(4,421)$(10,268)$855 
Gain on sale of investment (2)Gain on sale of investment (2)10,257 Gain on sale of investment (2)— — 10,257 — 
Basis differential (3)Basis differential (3)(1,392)(1,621)Basis differential (3)(1,106)(2,452)(1,734)(6,265)
Income (loss) from unconsolidated joint ventures$5,225 $(369)
Loss from unconsolidated joint venturesLoss from unconsolidated joint ventures$(5,597)$(6,873)$(1,745)$(5,410)
_______________ 
(1)Includes straight-line rent adjustments of approximately $1.1$5.5 million and $9.7$3.8 million for the three months ended March 31,September 30, 2021 and 2020, respectively. Forrespectively, and approximately $11.6 million and $22.0 million for the threenine months ended March 31,September 30, 2021 write-offs of accounts receivable and accrued rent balances totaled approximately $0.3 million.2020, respectively.
(2)During the threenine months ended March 31,September 30, 2021, the Company completed the sale of its 50% ownership interest in Annapolis Junction NFM LLC. The Company recognized a gain on sale of investment of approximately $10.3 million.
(3)Includes straight-line rent adjustments of approximately $0.5$0.1 million and $0.5$0.4 million for the three months ended March 31,September 30, 2021 and 2020, respectively, and approximately $0.7 million and $1.3 million for the nine months ended September 30, 2021 and 2020, respectively. Also includes net above-/below-market rent adjustments of approximately $0.1 million and $0.3$0.2 million for the three months ended March 31,September 30, 2021 and 2020, respectively, and approximately $0.2 million and $0.7 million for the nine months ended September 30, 2021 and 2020, respectively.
On February 25, 2021, a joint venture in which the Company hashad a 54% interest, commenced the development of 751 Gateway, a speculative laboratory building located in South San Francisco, California, that is expected to be approximately 229,000 net rentable square feet upon completion. 751 Gateway is the first phase of a multi-phase development plan at Gateway Commons. Upon the formation of the joint venture in 2020, the Company had an approximately 55% ownership interest in the joint venture as a result of the partner’s deferred contribution and the partner is obligated to fund all required capital until such time as the Company owns a 50% interest. On March 31,September 30, 2021, the Company had a 54%52% interest in the joint venture. The Company expects the 751 Gateway development project to be transferred to a separate joint venture with the same partner. The Company expects it will own a 49% interest in any development project, including 751 Gateway.this new joint venture.
On March 30, 2021, the Company completed the sale of its 50% ownership interest in Annapolis Junction NFM LLC (the “Annapolis Junction Joint Venture”) to the joint venture partner for a gross sales price of $65.9 million. Net cash proceeds to the Company totaled approximately $17.6$17.8 million after repayment of the Company's share of debt totaling approximately $15.1 million and the deferment of a $0.2 million payment due from the purchaser.million. The Company recognized a gain on sale of investment totaling approximately $10.3 million, which is included in Income (Loss)Loss from Unconsolidated Joint Ventures in the accompanying Consolidated Statements of Operations. In addition to net cash proceeds from the sale, the Company will be distributedreceived a distribution of approximately $5.8 million of available cash subsequent to March 31, 2021.cash. Annapolis Junction Buildings Six and Seven are Class A office properties totaling approximately 247,000 net rentable square feet. With the sale of the Company’s ownership interest in the Annapolis Junction Joint Venture, the Company no longer has any assets in Annapolis, Maryland.
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On June 11, 2021, a joint venture in which the Company has a 50% interest partially placed in-service 100 Causeway Street, a Class A office project with approximately 632,000 net rentable square feet located in Boston, Massachusetts.
On August 31, 2021, a joint venture in which the Company has a 50% interest extended the construction loan collateralized by its The Hub on Causeway – Podium property. At the time of the extension, the outstanding balance of the loan totaled approximately $174.3 million, bore interest at a variable rate equal to LIBOR plus 2.25% per annum and was scheduled to mature on September 6, 2021, with 2, 1-year extension options, subject to certain conditions. The extended loan continues to bear interest at a variable rate equal to LIBOR plus 2.25% per annum and matures on September 6, 2023. The Hub on Causeway - Podium is a retail and office property with approximately 382,000 net rentable square feet located in Boston, Massachusetts.
On September 1, 2021, the Company entered into a joint venture to acquire Safeco Plaza, a Class A office property located in Seattle, Washington, for a gross purchase price of approximately $465.0 million. Safeco Plaza is a 50-story, approximately 765,000 net rentable square-foot, Class A office property. The acquisition was completed through a newly formed joint venture with 2 institutional partners. Each of the institutional partners invested approximately $71.9 million of cash for its 33.165% ownership interest in the joint venture. The Company invested approximately $72.6 million for its 33.67% interest in the joint venture and is providing customary operating, property management and leasing services to the joint venture. The Company’s ownership includes (1) a 33.0% direct interest in the joint venture, and (2) an additional 1% interest in each of the two Safeco Partner Entities through which each partner owns its interest in the joint venture. Subject to the occurrence of certain events and the joint venture achieving certain return thresholds, the Company is entitled to earn promote distributions. Some of the promote distributions may be payable in cash or, at the Company’s election, equity interest(s) in the Safeco Partner Entity(ies). The purchase price was funded with cash and proceeds from a new mortgage loan secured by the property. The mortgage loan has a principal amount of $250.0 million, bears interest at a variable rate equal to the greater of (x) 2.35% or (y) LIBOR plus 2.20% per annum and matures on September 1, 2026.
6. Mortgage Notes Payable
On March 26, 2021, the Company used available cash to repay the mortgage loan collateralized by its University Place property located in Cambridge, Massachusetts totaling approximately $0.9 million. The mortgage loan bore interest at a fixed rate of 6.94% per annum and was scheduled to mature on August 1, 2021. There was no prepayment penalty.
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7. Unsecured Senior Notes
The following summarizes the unsecured senior notes outstanding as of March 31,September 30, 2021 (dollars in thousands): 
Coupon/
Stated Rate
Effective
Rate(1)
Principal
Amount
Maturity Date(2)Coupon/Stated RateEffective Rate(1)Principal AmountMaturity Date(2)
11 Year Unsecured Senior Notes11 Year Unsecured Senior Notes3.850 %3.954 %$1,000,000 February 1, 202311 Year Unsecured Senior Notes3.850 %3.954 %$1,000,000 February 1, 2023(3)
10.5 Year Unsecured Senior Notes10.5 Year Unsecured Senior Notes3.125 %3.279 %500,000 September 1, 202310.5 Year Unsecured Senior Notes3.125 %3.279 %500,000 September 1, 2023
10.5 Year Unsecured Senior Notes10.5 Year Unsecured Senior Notes3.800 %3.916 %700,000 February 1, 202410.5 Year Unsecured Senior Notes3.800 %3.916 %700,000 February 1, 2024
7 Year Unsecured Senior Notes7 Year Unsecured Senior Notes3.200 %3.350 %850,000 January 15, 20257 Year Unsecured Senior Notes3.200 %3.350 %850,000 January 15, 2025
10 Year Unsecured Senior Notes10 Year Unsecured Senior Notes3.650 %3.766 %1,000,000 February 1, 202610 Year Unsecured Senior Notes3.650 %3.766 %1,000,000 February 1, 2026
10 Year Unsecured Senior Notes10 Year Unsecured Senior Notes2.750 %3.495 %1,000,000 October 1, 202610 Year Unsecured Senior Notes2.750 %3.495 %1,000,000 October 1, 2026
10 Year Unsecured Senior Notes10 Year Unsecured Senior Notes4.500 %4.628 %1,000,000 December 1, 202810 Year Unsecured Senior Notes4.500 %4.628 %1,000,000 December 1, 2028
10 Year Unsecured Senior Notes10 Year Unsecured Senior Notes3.400 %3.505 %850,000 June 21, 202910 Year Unsecured Senior Notes3.400 %3.505 %850,000 June 21, 2029
10.5 Year Unsecured Senior Notes10.5 Year Unsecured Senior Notes2.900 %2.984 %700,000 March 15, 203010.5 Year Unsecured Senior Notes2.900 %2.984 %700,000 March 15, 2030
10.75 Year Unsecured Senior Notes10.75 Year Unsecured Senior Notes3.250 %3.343 %1,250,000 January 30, 203110.75 Year Unsecured Senior Notes3.250 %3.343 %1,250,000 January 30, 2031
11 Year Unsecured Senior Notes11 Year Unsecured Senior Notes2.550 %2.671 %850,000 April 1, 203211 Year Unsecured Senior Notes2.550 %2.671 %850,000 April 1, 2032
12 Year Unsecured Senior Notes12 Year Unsecured Senior Notes2.450 %2.524 %850,000 October 1, 2033
Total principalTotal principal9,700,000 Total principal10,550,000 
Less:Less:Less:
Net unamortized discountNet unamortized discount18,736 Net unamortized discount17,581 
Deferred financing costs, netDeferred financing costs, net49,672 Deferred financing costs, net52,768 
TotalTotal$9,631,592 Total$10,479,651 
_______________
(1)Yield on issuance date including the effects of discounts on the notes, settlements of interest rate contracts and the amortization of financing costs.
(2)No principal amounts are due prior to maturity.
(3)See Note 15.
On February 14, 2021, Boston Properties Limited Partnership completed the redemption of $850.0 million in aggregate principal amount of its 4.125% senior notes due May 15, 2021. The redemption price was approximately $858.7 million, which was equal to parthe stated principal plus approximately $8.7 million of accrued and unpaid interest to, but not including, the redemption date. Excluding the accrued and unpaid interest, the redemption price was equal to the principal amount being redeemed. The Company recognized a loss from early extinguishment of debt totaling approximately $0.4 million related to unamortized origination costs.
On March 16, 2021, Boston Properties Limited Partnership completed a public offering of $850.0 million in aggregate principal amount of its 2.550% unsecured senior notes due 2032. The notes were priced at 99.570% of the principal amount to yield an effective rate (including financing fees) of approximately 2.671% per annum to maturity. The notes will mature on April 1, 2032, unless earlier redeemed. The aggregate net proceeds from the offering were approximately $839.2 million after deducting underwriting discounts and transaction expenses.
On September 29, 2021, Boston Properties Limited Partnership completed a public offering of $850.0 million in aggregate principal amount of its 2.450% unsecured senior notes due 2033. The notes were priced at 99.959% of the principal amount to yield an effective rate (including financing fees) of approximately 2.524% per annum to maturity. The notes will mature on October 1, 2033, unless earlier redeemed. The aggregate net proceeds from the offering were approximately $842.5 million after deducting underwriting discounts and transaction expenses.
The indenture relating to the unsecured senior notes contains 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 greater than 1.50, and (4) an unencumbered asset value of not less than 150% of unsecured debt. At March 31,September 30, 2021, Boston Properties Limited Partnership was in compliance with each of these financial restrictions and requirements.
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8. Unsecured Credit Facility
On April 24, 2017, Boston Properties Limited Partnership amended and restated its unsecured revolving credit agreement (as amended and restated, the “2017 Credit Facility”). Among other things, the 2017 Credit Facility (1) increased the total commitment of the revolving line of credit (the “Revolving Facility”) from $1.0 billion to $1.5 billion, (2) extended the maturity date from July 26, 2018 to April 24, 2022, (3) reduced the per annum variable interest rates, and (4) added a $500.0 million delayed draw term loan facility (the “Delayed Draw Facility”) that permitted Boston Properties Limited Partnership to draw upon it provided that amounts drawn and subsequently repaid may not be borrowed again. In addition, Boston Properties Limited Partnership may increase the total commitment under the 2017 Credit Facility by up to $500.0 million through increases in the Revolving Facility or the Delayed Draw Facility, or both, subject to syndication of the increase and other conditions.
On April 24, 2018, Boston Properties Limited Partnership exercised its option to draw $500.0 million on its Delayed Draw Facility. Prior to its repayment on March 16, 2021, the Delayed Draw Facility bore interest at a variable rate equal to LIBOR plus 0.95% per annum based on Boston Properties Limited Partnership’s credit rating.
On March 16, 2021, Boston Properties Limited Partnership repaid $500.0 million, representing all amounts borrowedoutstanding on its delayed draw term loan facility under the Delayed Draw Facility.its unsecured revolving credit agreement (the “2017 Credit Facility”). The Company recognized a loss from early extinguishment of debt totaling approximately $0.5 million related to unamortized financing costs. At March 31,
On June 15, 2021, Boston Properties Limited Partnership had 0 amounts outstanding under itsamended and restated the 2017 Credit Facility.Facility (as amended and restated, the “2021 Credit Facility”). The 2021 Credit Facility provides for borrowings of up to $1.5 billion (the “Revolving Facility”), subject to customary conditions. Among other things, the amendment and restatement (1) extended the maturity date to June 15, 2026, (2) eliminated the $500.0 million delayed draw term loan facility provided under the 2017 Credit Facility, (3) reduced the per annum variable interest rates on borrowings and (4) added a sustainability-linked pricing component. Under the 2021 Credit Facility, Boston Properties Limited Partnership may increase the total commitment by up to $500.0 million by increasing the amount of the Revolving Facility and/or by incurring one or more term loans, in each case, subject to syndication of the increase and other conditions.
The 2021 Credit Facility replaces the 2017 Credit Facility, which was scheduled to expire on April 24, 2022.
At Boston Properties Limited Partnership’s option, loans under the 2021 Credit Facility will bear interest at a rate per annum equal to (1) (a) in the case of loans denominated in Dollars, LIBOR, (b) in the case of loans denominated in Euro, EURIBOR, (c) in the case of loans denominated in Canadian Dollars, CDOR, and (d) in the case of loans denominated in Sterling, SONIA, in each case, plus a margin ranging from 70.0 to 140.0 basis points based on Boston Properties Limited Partnership’s credit rating or (2) an alternate base rate equal to the greatest of (a) the Federal Funds rate plus 0.5%, (b) the Administrative Agent’s prime rate, (c) LIBOR for a one-month period plus 1.00%, and (d) 1.00%, in each case, plus a margin ranging from 0 to 40 basis points based on Boston Properties Limited Partnership’s credit rating.
The 20172021 Credit Facility also features a sustainability-linked pricing component such that if Boston Properties Limited Partnership meets certain sustainability performance targets, the applicable per annum interest rate will be reduced by one basis point. The LIBOR replacement provisions in the 2021 Credit Facility permit the use of rates based on the secured overnight financing rate administered by the Federal Reserve Bank of New York plus an applicable spread adjustment. In addition, the 2021 Credit Facility contains a competitive bid option for up to 65% of the Revolving Facility that allows banks that are part of the lender consortium to bid to make loan advances to Boston Properties Limited Partnershipat a reduced interest rate.
Pursuant to the 2021 Credit Facility, Boston Properties Limited Partnership is obligated to pay (1) in quarterly installments a facility fee on the total commitment under the Revolving Facility at a rate per annum ranging from 0.10% to 0.30% based on Boston Properties Limited Partnership’s credit rating and (2) an annual fee on the undrawn amount of each letter of credit ranging from 0.70% to 1.40% based on Boston Properties Limited Partnership’s credit rating.
Based on Boston Properties Limited Partnership’s current credit rating, (1) the applicable Eurocurrency and LIBOR Daily Floating Rate margins are 0.775%, (2) the alternate base rate margin is 0 basis points and (3) the facility fee is 0.15% per annum.
The 2021 Credit Facility contains customary representations and warranties, affirmative and negative covenants, and events of default provisions, including the failure to pay indebtedness, breaches of covenants and bankruptcy and other insolvency events, which could result in the acceleration of the obligation to repay all outstanding amounts and the cancellation of all commitments outstanding under the 2021 Credit Agreement.Facility. Among other covenants, the 20172021 Credit Facility requires that Boston Properties Limited Partnership maintain on an ongoing basis: (1) a leverage ratio not to exceed 60%, however, the leverage ratio may increase to no greater than 65% provided that it is reduced back to 60% within one year, (2) a secured debt leverage ratio not to exceed 55%, (3) a fixed charge coverage ratio of at least 1.40, (4) an unsecured debt leverage ratio not to exceed 60%, however, the unsecured debt leverage ratio may increase to no greater than 65% provided that it is reduced to 60% within one year, (5) an unsecured debt interest coverage ratio of at least 1.75 and (6) limitations on permitted investments. At March 31,September 30, 2021, Boston Properties Limited Partnership was in compliance with each of these financial and other covenant requirements.
At September 30, 2021, Boston Properties Limited Partnership had no amounts outstanding under the 2021 Credit Facility.
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9. Commitments and Contingencies
General
In the normal course of business, the Company guarantees its performance of services or indemnifies third parties against its negligence. In addition, in the normal course of business, the Company guarantees to certain tenants the obligations of its subsidiaries for the payment of tenant improvement allowances and brokerage commissions in connection with their leases and limited costs arising from delays in delivery of their premises. 
The Company hashad letter of credit and performance obligations related to lender and development requirements that total approximately $20.2$25.8 million at March 31,September 30, 2021.
Certain of the Company’s joint venture agreements include provisions whereby, at certain specified times, each partner has the right to initiate a purchase or sale of its interest in the joint ventures. With limited exception, under these provisions, the Company is not compelled to purchase the interest of its outside joint venture partners. From time to time, under certain of the Company’s joint venture agreements, if certain return thresholds are achieved, either the Company or its partners may be entitled to an additional promoted interest or payments.
From time to time, the Company (or ventures in which the Company has an ownership interest) has agreed, and may in the future agree, to (1) guarantee portions of the principal, interest and other amounts in connection with their borrowings, (2) provide customary environmental indemnifications and nonrecourse carve-outs (e.g., guarantees against fraud, misrepresentation and bankruptcy) in connection with their borrowings and (3) provide guarantees to lenders, tenants and other third parties for the completion of development projects. The Company has agreements with its outside partners whereby the partners agree to reimburse the joint venture for their share of any payments made under the guarantee. In some cases, the Company earns a fee from the applicable joint venture for providing the guarantee.
In connection with the refinancing of 767 Fifth Avenue’s (the General Motors Building) secured loan by the Company’s consolidated joint venture entity, 767 Venture, LLC, the Company guaranteed the consolidated entity’s


obligation to fund various reserves for tenant improvement costs and allowances, leasing commissions and free rent obligations in lieu of cash deposits. As of March 31,September 30, 2021, the maximum funding obligation under the guarantee was approximately $23.1$20.3 million. The Company earns a fee from the joint venture for providing the guarantee and has an agreement with the outside partners to reimburse the joint venture for their share of any payments made under the guarantee. As of March 31,September 30, 2021, no amounts related to the guarantee are recorded as liabilities in the Company’s consolidated financial statements.
Pursuant to the lease agreement with Marriott, the Company has guaranteed the completion of the office building and parking garage on behalf of its 7750 Wisconsin Avenue joint venture and has also provided a financing guaranty as required with respect to the third-party construction financing.  The Company earns fees from the joint venture for providing the guarantees and any amounts the Company pays under the guarantee(s) will be deemed to be capital contributions by the Company to the joint venture.  The Company has also agreed to fund construction costs through capital contributions to the joint venture in the event of insufficiency of third-party construction financing.  In addition, the Company has guaranteed to Marriott, as hotel manager, the completion of a hotel being developed by an affiliate of The Bernstein Companies (the Company’s partner in the 7750 Wisconsin Avenue joint venture) adjacent to the office property, for which the Company earns a fee from the affiliate of The Bernstein Companies.  In addition, the Company entered into agreements with affiliates of The Bernstein Companies whereby the Company could be required to act as a mezzanine and/or mortgage lender and finance the construction of the hotel property.  An affiliate of The Bernstein Companies exercised its option to borrow $10.0 million from the Company under such agreements, which financing was provided by the Company on June 1, 2020. The financing bears interest at a fixed rate of 8.00% per annum, compounded monthly, and matures on the fifth anniversary of the date on which the base building of the affiliate of The Bernstein Companies’ hotel property is substantially completed. The financing is collateralized by a pledge of the partner’s equity interest in the joint venture that owns and is developing 7750 Wisconsin Avenue. To secure such financing arrangements, affiliates of The Bernstein Companies are required to provide certain security, which varies depending on the specific loan, by pledges of their equity interest in the office property, a fee mortgage on the hotel property, or both. As of March 31,September 30, 2021, 0no amounts related to the contingent aspect of any of the guarantees are recorded as liabilities in the Company’s consolidated financial statements.
In connection with the sale and development of the Company’s 6595 Springfield Center Drive development project, the Company has guaranteed the completion of the project and the payment of certain cost overruns in accordance with the development management agreement with the buyer. Although the project has been sold and the lease with the Federal Government tenant has been assigned to the buyer, pursuant to the terms of the Federal
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Government lease, the Federal Government tenant iswas not obligated to release the prior owner/landlord from such landlord’s obligations under the lease until completion of the construction.construction. As a result, the entity which previously owned the land remains liable to the Federal Government tenant for the completion of the construction obligations under the lease.  The buyer is obligated to fund the balance of the costs to meet such construction obligations, subject to the Company’s obligation to fund cost overruns (if any), as noted above. An affiliate of the buyer has provided a guaranty of the obligations of the buyer to fund such construction costs and the buyer has agreed to use commercially reasonable efforts to require the construction lender to provide certain remedies to the Company in the event the buyer does not fund such construction obligations. As of March 31, 2021, 0 amounts related to the contingent aspectFinal completion of the project was achieved during the nine months ended September 30, 2021 and the Company has been released of its guarantee are recorded as a liability in the Company’s consolidated financial statements.obligations (See Note 3).
In connection with the redevelopment of the Company’s 325 Main Street property located in Cambridge, Massachusetts, the Company was required, pursuant to the local zoning ordinance and urban renewal plan, to commence construction of a residential building of at least 200,000 square feet with 25% of the project designated as income-restricted (with a minimum of 20% of the square footage devoted to home ownership units) prior to the occupancy of the 325 Main Street property, which is expected to occur during the third quarter of 2022. The zoning ordinance and urban renewal plan were each recently amended to decouple the residential requirement from the occupancy of the 325 Main Street property. The amendment to the urban renewal plan is subject to final approvals and completion of administrative processes. 325 Main Street consisted of an approximately 115,000 net rentable square foot Class A office property that was demolished and is being developed into an approximately 420,000 net rentable square foot Class A office property, including approximately 41,000 net rentable square feet of retail space.
Insurance
The Company’s property insurance program per occurrence limits are $1.0 billion for its portfolio insurance program, including coverage for acts of terrorism other than nuclear, biological, chemical or radiological terrorism (“Terrorism Coverage”). The Company also carries $250 million of Terrorism Coverage for 601 Lexington Avenue, New York, New York (“601 Lexington Avenue”) in excess of the $1.0 billion of coverage in the Company’s property insurance program. Certain properties, including the General Motors Building located at 767 Fifth Avenue in New
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York, New York (“767 Fifth Avenue”), are currently insured in separate insurance programs. The property insurance program per occurrence limits for 767 Fifth Avenue are $1.625 billion, including Terrorism Coverage. The Company also currently carries nuclear, biological, chemical and radiological terrorism insurance coverage for acts of terrorism certified under the Federal Terrorism Risk Insurance Act (as amended, “TRIA”) (“NBCR Coverage”), which is provided by IXP as a direct insurer, for the properties in the Company’s portfolio, including 767 Fifth Avenue, but excluding certain other properties owned in joint ventures with third parties or which the Company manages. The per occurrence limit for NBCR Coverage is $1.0 billion. Under TRIA, after the payment of the required deductible and coinsurance, the NBCR Coverage provided by IXP is backstopped by the Federal Government if the aggregate industry insured losses resulting from a certified act of terrorism exceed a “program trigger.” The program trigger is $200 million, the coinsurance is 20% and the deductible is 20% of the premiums earned by the insurer for the year prior to a claim. If the Federal Government pays out for a loss under TRIA, it is mandatory that the Federal Government recoup the full amount of the loss from insurers offering TRIA coverage after the payment of the loss pursuant to a formula in TRIA. The Company may elect to terminate the NBCR Coverage if the Federal Government seeks recoupment for losses paid under TRIA, if TRIA is not extended after its expiration on December 31, 2027, if there is a change in its portfolio or for any other reason. The Company intends to continue to monitor the scope, nature and cost of available terrorism insurance.
The Company also currently carries earthquake insurance on its properties located in areas known to be subject to earthquakes. In addition, this insurance is subject to a deductible in the amount of 3% of the value of the affected property. Specifically, the Company currently carries earthquake insurance which covers its San Francisco and Los Angeles regions with a $240 million per occurrence limit, and a $240 million annual aggregate limit, $20 million of which is provided by IXP, as a direct insurer. This insurance is subject to a deductible in the amount of 3% of the value of the affected property. In addition, the Company currently carries earthquake insurance which covers its Seattle region with a $60 million per occurrence limit, and a $60 million annual aggregate limit. This insurance is subject to a deductible in the amount of 2% of the value of the affected property. The amount of the Company’s earthquake insurance coverage may not be sufficient to cover losses from earthquakes. In addition, the amount of earthquake coverage could impact the Company’s ability to finance properties subject to earthquake risk. The Company may discontinue earthquake insurance or change the structure of its earthquake insurance program on some or all of its properties in the future if the premiums exceed the Company’s estimation of the value of the coverage.
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IXP, a captive insurance company which is a wholly-owned subsidiary of the Company, acts as a direct insurer with respect to a portion of the Company’s earthquake insurance coverage for its Greater San Francisco and Los Angeles properties and the Company’s NBCR Coverage. Insofar as the Company owns IXP, it is responsible for its liquidity and capital resources, and the accounts of IXP are part of the Company’s consolidated financial statements. In particular, if a loss occurs which is covered by the Company’s NBCR Coverage but is less than the applicable program trigger under TRIA, IXP would be responsible for the full amount of the loss without any backstop by the Federal Government. IXP would also be responsible for any recoupment charges by the Federal Government in the event losses are paid out and its insurance policy is maintained after the payout by the Federal Government. If the Company experiences a loss and IXP is required to pay under its insurance policy, the Company would ultimately record the loss to the extent of the required payment. Therefore, insurance coverage provided by IXP should not be considered as the equivalent of third-party insurance, but rather as a modified form of self-insurance. In addition, Boston Properties Limited Partnership has issued a guarantee to cover liabilities of IXP in the amount of $20.0 million.
Due to the current COVID-19 pandemic, the Company anticipates the possibility of business interruption, loss of lease revenue and/or other associated expenses related to the Company’s operations across its portfolio. Because this is an ongoing situation it is not yet possible to quantify the Company’s losses and expenses, which continue to develop. Because of the complexity of the Company’s insurance policies and limited precedent for claims being made related to pandemics, it is not yet possible to determine if such losses and expenses will be covered by the Company’s insurance policies. Therefore, at this time, the Company is providinghas provided notice to the applicable insurers of the potential for claims in order to protect the Company’s rights under its policies.
The Company continues to monitor the state of the insurance market in general, and the scope and costs of coverage for acts of terrorism, California earthquake riskearthquakes and pandemics, in particular, but the Company cannot anticipate what coverage will be available on commercially reasonable terms in future policy years. There are other types of losses, such as from wars, 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, pandemics 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.
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10. Noncontrolling Interests
Noncontrolling interests relate to the interests in Boston Properties Limited Partnership not owned by Boston Properties, Inc. and interests in consolidated property partnerships not wholly-owned by the Company. As of March 31,September 30, 2021, the noncontrolling interests in Boston Properties Limited Partnership consisted of 16,053,64015,989,304 OP Units, 1,525,3061,487,492 LTIP Units (including 451,043419,423 LTIP Units earned by employees under the Company’s multi-year long-term incentive awards granted between 2012-2018 (i.e., 2012 OPP and 2013-2018 MYLTIP awards)), 219,916 2019 MYLTIP Units, 203,278 2020 MYLTIP Units and 352,021 2021 MYLTIP Units held by parties other than Boston Properties, Inc.
Noncontrolling Interest—Common Units
During the threenine months ended March 31,September 30, 2021, 118,290 227,233 OP Units were presented by the holders for redemption (including 64,799 OP(including 144,399 OP Units issued upon conversion of LTIP Units, 2012 OPP Units and MYLTIP Units) and were redeemed by Boston Properties, Inc. in exchange for an equal number of shares of Common Stock.
At March 31,September 30, 2021, Boston Properties Limited Partnership had outstanding 219,916 2019 MYLTIP Units, 203,278 2020 MYLTIP Units and 352,021 2021 MYLTIP Units. Prior to the end of the respective three-year performance period for each plan, holders of MYLTIP Units are entitled to receive per unit distributions equal to one-tenth (10%) of the regular quarterly distributions payable on an OP Unit, but will not be entitled to receive any special distributions. After the measurement date, the number of MYLTIP Units, both vested and unvested, that MYLTIP award recipients have earned, if any, based on the establishment of a performance pool, will be entitled to receive distributions in an amount per unit equal to distributions, both regular and special, payable on an OP Unit.
On February 5, 2021, the measurement period for the Company’s 2018 MYLTIP awards ended and, based on Boston Properties, Inc.’s relative TSR performance, the final awards were determined to be 29.2% of target, or an
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aggregate of approximately $4.6 million (after giving effect to employee separations). As a result, an aggregate of 285,925 2018 MYLTIP Units that had been previously granted were automatically forfeited.
The following table presents Boston Properties Limited Partnership’s distributions on the OP Units and LTIP Units (including the 2012 OPP Units, 2013 - 2017 MYLTIP Units and, after the February 5, 2021 measurement date, the 2018 MYLTIP Units) and its distributions on the 2018 MYLTIP Units (prior to the February 5, 2021 measurement date) and 2019 - 2021 MYLTIP Units (after the February 2, 2021 issuance date of the 2021 MYLTIP Units) that occurred during the threenine months ended March 31,September 30, 2021:
Record DateRecord DatePayment DateDistributions per OP Unit and LTIP UnitDistributions per MYLTIP UnitRecord DatePayment DateDistributions per OP Unit and LTIP UnitDistributions per MYLTIP Unit
September 30, 2021September 30, 2021October 29, 2021$0.98 $0.098 
June 30, 2021June 30, 2021July 30, 2021$0.98 $0.098 
March 31, 2021March 31, 2021April 30, 2021$0.98 $0.098 March 31, 2021April 30, 2021$0.98 $0.098 
December 31, 2020December 31, 2020January 28, 2021$0.98 $0.098 December 31, 2020January 28, 2021$0.98 $0.098 
The following table presents Boston Properties Limited Partnership’s distributions on the OP Units and LTIP Units (including the 2012 OPP Units, 2013 - 2016 MYLTIP Units and, after the February 6, 2020 measurement date, the 2017 MYLTIP Units) and its distributions on the 2017 MYLTIP Units (prior to the February 6, 2020 measurement date) and 2018 - 2020 MYLTIP Units (after the February 4, 2020 issuance date of the 2020 MYLTIP Units) that occurred during the threenine months ended March 31,September 30, 2020:
Record DateRecord DatePayment DateDistributions per OP Unit and LTIP UnitDistributions per MYLTIP UnitRecord DatePayment DateDistributions per OP Unit and LTIP UnitDistributions per MYLTIP Unit
September 30, 2020September 30, 2020October 30, 2020$0.98 $0.098 
June 30, 2020June 30, 2020July 31, 2020$0.98 $0.098 
March 31, 2020March 31, 2020April 30, 2020$0.98 $0.098 March 31, 2020April 30, 2020$0.98 $0.098 
December 31, 2019December 31, 2019January 30, 2020$0.98 $0.098 December 31, 2019January 30, 2020$0.98 $0.098 
A holder of an OP Unit may present the OP Unit to Boston Properties Limited Partnership for redemption at any time (subject to restrictions agreed upon at the time of issuance of OP Units to particular holders that may restrict such redemption right for a period of time, generally 1 year from issuance). Upon presentation of an OP Unit for redemption, Boston Properties Limited Partnership must redeem the OP Unit for cash equal to the then value of a share of Common Stock of Boston Properties, Inc. Boston Properties, Inc. may, in its sole discretion, elect to assume and satisfy the redemption obligation by paying either cash or issuing 1 share of Common Stock. The value of the OP Units (not owned by Boston Properties, Inc. and LTIP Units (including the 2012 OPP Units and 2013 - 2018 MYLTIP Units) assuming that all conditions had been met for the conversion thereof) had all of such
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units been redeemed at March 31,September 30, 2021 was approximately $1.8$1.9 billion based on the last reported price of a share of Common Stock on the New York Stock Exchange of $101.26$108.35 per share on March 31,September 30, 2021.
Noncontrolling Interests—Property Partnerships
The noncontrolling interests in property partnerships consist of the outside equity interests in ventures that are consolidated with the financial results of the Company because the Company exercises control over the entities that own the properties. The equity interests in these ventures that are not owned by the Company, totaling approximatelyapproximately $1.7 billion at March 31,at September 30, 2021 and December 31, 2020, are included in Noncontrolling Interests—Property Partnerships on the accompanying Consolidated Balance Sheets.
11. Stockholders’ Equity / Partners’ Capital
Boston Properties, Inc.
As of March 31,September 30, 2021, Boston Properties, Inc. had 156,074,200156,206,491 shares of Common Stock outstanding.
As of March 31,September 30, 2021, Boston Properties, Inc. owned 1,736,5311,736,833 general partnership units and 154,337,669154,469,658 limited partnership units in Boston Properties Limited Partnership.
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On May 22, 2020, Boston Properties, Inc. renewed its “at the market” (“ATM”) stock offering program through which it may sell from time to time up to an aggregate of $600.0 million of its Common Stock through sales agents over a 3-year period. Under the ATM stock offering program, Boston Properties, Inc. may also engage in forward sale transactions with affiliates of certain sales agents for the sale of its Common Stock on a forward basis. This program replaced Boston Properties, Inc.’s prior $600.0 million ATM stock offering program that was scheduled to expire on June 2, 2020. Boston Properties, Inc. intends to use the net proceeds from any offering for general business purposes, which may include investment opportunities and debt reduction. No shares of Common Stock have been issued under this ATM stock offering program.
During the threenine months ended March 31,September 30, 2021, Boston Properties, Inc. issued 206,377 shares of Common Stock upon the exercise of options to purchase Common Stock.
During the threenine months ended March 31,September 30, 2021, Boston Properties, Inc. issued 118,290227,233 shares of Common Stock in connection with the redemption of an equal number of redeemable OP Units from limited partners.
The following table presents Boston Properties, Inc.’s dividends per share and Boston Properties Limited Partnership’s distributions per OP Unit and LTIP Unit paid or declared in 2021 and during the threenine months ended March 31,September 30, 2020:
Record DateRecord DatePayment DateDividend (Per Share)Distribution (Per Unit)Record DatePayment DateDividend (Per Share)Distribution (Per Unit)
September 30, 2021September 30, 2021October 29, 2021$0.98 $0.98 
June 30, 2021June 30, 2021July 30, 2021$0.98 $0.98 
March 31, 2021March 31, 2021April 30, 2021$0.98 $0.98 March 31, 2021April 30, 2021$0.98 $0.98 
December 31, 2020December 31, 2020January 28, 2021$0.98 $0.98 December 31, 2020January 28, 2021$0.98 $0.98 
September 30, 2020September 30, 2020October 30, 2020$0.98 $0.98 
June 30, 2020June 30, 2020July 31, 2020$0.98 $0.98 
March 31, 2020March 31, 2020April 30, 2020$0.98 $0.98 March 31, 2020April 30, 2020$0.98 $0.98 
December 31, 2019December 31, 2019January 30, 2020$0.98 $0.98 December 31, 2019January 30, 2020$0.98 $0.98 
Preferred Stock
On March 2, 2021, Boston Properties, Inc. issued a redemption notice for 80,000 shares of its Series B Preferred Stock, which constituted all of the outstanding Series B Preferred Stock, and the corresponding Depositary Shares, each representing 1/100th of a share of Series B Preferred Stock, and recorded it as a liability.Stock. The redemption price per share of Series B Preferred Stock was equal to $2,500 plus all accrued and unpaid dividend to, but not including, the redemption date, totaling $2,516.41 per share. On March 31, 2021, the Company transferred the full redemption price for all outstanding shares of Series B Preferred Stock of approximately $201.3 million including approximately $1.3 million of accrued and unpaid dividends to, but not including, the redemption date, to the redemption agent and recorded that amount within Cash held in escrows on the Consolidated Balance Sheets. Upon redemption of the Series B Preferred Stock, all outstanding shares of the Series B Preferred Units, which had terms and preferences generally mirroring those of the Series B Preferred Stock, were redeemed by Boston Properties Limited Partnership.agent. The excess of the redemption price over the
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carrying value of the Series B Preferred Stock and Series B Preferred Units of approximately $6.4 million relates to the original issuance costs and will beis reflected as a reduction to Net Income Attributable to Boston Properties, Inc. common shareholders and Net Income Attributable to Boston Properties Limited Partnership common unitholders on the Consolidated Income Statement (See Note 15).Statement.
On April 1, 2021, Boston Properties, Inc. redeemed 80,000 shares of Series B Preferred Stock (including the corresponding 8,000,000 Depositary Shares), which represented all of the outstanding shares of Series B Preferred Stock and all of the outstanding Depositary Shares. In connection with the redemption of the Series B Preferred Stock, all of the Series B Preferred Units, which had terms and preferences generally mirroring those of the Series B Preferred Stock, were redeemed by Boston Properties Limited Partnership.
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The following table presents Boston Properties, Inc.’s dividends per share on its outstanding Series B Preferred Stock paid or declared during 2021 and during the threenine months ended March 31,September 30, 2020:
Record DatePayment DateDividend (Per Share)
February 5, 2021February 16, 2021$32.8125 
November 4, 2020November 16, 2020$32.8125 
August 3, 2020August 17, 2020$32.8125 
May 1, 2020May 15, 2020$32.8125 
February 4, 2020February 18, 2020$32.8125 
12. Segment Information
The following tables present reconciliations of Net Income Attributable to Boston Properties, Inc. Common Shareholders to the Company’s share of Net Operating Income and Net Income Attributable to Boston Properties Limited Partnership Common Unitholders to the Company’s share of Net Operating Income for the three and nine monthsended March 31,September 30, 2021 and 2020.
Boston Properties, Inc.
 Three months ended March 31,
20212020
(in thousands)
Net income attributable to Boston Properties, Inc. common shareholders$91,624 $497,496 
Add:
Preferred stock redemption charge6,412 
Preferred dividends2,560 2,625 
Noncontrolling interest—common units of the Operating Partnership11,084 57,539 
Noncontrolling interests in property partnerships16,467 19,486 
Interest expense107,902 101,591 
Losses from early extinguishment of debt898 
Net operating income from unconsolidated joint ventures24,795 28,758 
Depreciation and amortization expense176,565 171,094 
Transaction costs331 615 
Payroll and related costs from management services contracts3,505 3,237 
General and administrative expense44,959 36,454 
Less:
Net operating income attributable to noncontrolling interests in property partnerships44,376 47,661 
Gains (losses) from investments in securities1,659 (5,445)
Interest and other income (loss)1,168 3,017 
Gains on sales of real estate410,165 
Income (loss) from unconsolidated joint ventures5,225 (369)
Direct reimbursements of payroll and related costs from management services contracts3,505 3,237 
Development and management services revenue6,803 7,879 
Company’s share of Net Operating Income$424,366 $452,750 

 Three months ended September 30,Nine months ended September 30,
2021202020212020
(in thousands)
Net income attributable to Boston Properties, Inc. common shareholders$108,297 $89,854 $311,680 $854,541 
Add:
Preferred stock redemption charge— — 6,412 — 
Preferred dividends— 2,625 2,560 7,875 
Noncontrolling interest—common units of the Operating Partnership11,982 10,020 35,393 97,090 
Noncontrolling interests in property partnerships18,971 15,561 52,602 34,280 
Interest expense105,794 110,993 320,015 319,726 
Losses from early extinguishment of debt— — 898 — 
Loss from unconsolidated joint ventures5,597 6,873 1,745 5,410 
Net operating income from unconsolidated joint ventures24,266 24,938 74,478 81,607 
Depreciation and amortization expense179,412 166,456 539,815 515,738 
Transaction costs1,888 307 2,970 1,254 
Payroll and related costs from management services contracts3,006 2,896 9,166 8,617 
General and administrative expense34,560 27,862 117,924 102,059 
Less:
Net operating income attributable to noncontrolling interests in property partnerships47,800 42,160 138,463 122,248 
Gains (losses) from investments in securities(190)1,858 3,744 965 
Interest and other income (loss)1,520 (45)4,140 4,277 
Gains (losses) on sales of real estate348 (209)8,104 613,723 
Direct reimbursements of payroll and related costs from management services contracts3,006 2,896 9,166 8,617 
Development and management services revenue6,094 7,281 20,181 23,285 
Company’s share of Net Operating Income$435,195 $404,444 $1,291,860 $1,255,082 
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Boston Properties Limited Partnership
Three months ended March 31, Three months ended September 30,Nine months ended September 30,
20212020 2021202020212020
(in thousands)(in thousands)
Net income attributable to Boston Properties Limited Partnership common unitholdersNet income attributable to Boston Properties Limited Partnership common unitholders$105,773 $566,333 Net income attributable to Boston Properties Limited Partnership common unitholders$122,014 $101,624 $353,633 $969,932 
Add:Add:Add:
Preferred unit redemption chargePreferred unit redemption charge6,412 Preferred unit redemption charge— — 6,412 — 
Preferred distributionsPreferred distributions2,560 2,625 Preferred distributions— 2,625 2,560 7,875 
Noncontrolling interests in property partnershipsNoncontrolling interests in property partnerships16,467 19,486 Noncontrolling interests in property partnerships18,971 15,561 52,602 34,280 
Interest expenseInterest expense107,902 101,591 Interest expense105,794 110,993 320,015 319,726 
Losses from early extinguishment of debtLosses from early extinguishment of debt898 Losses from early extinguishment of debt— — 898 — 
Loss from unconsolidated joint venturesLoss from unconsolidated joint ventures5,597 6,873 1,745 5,410 
Net operating income from unconsolidated joint venturesNet operating income from unconsolidated joint ventures24,795 28,758 Net operating income from unconsolidated joint ventures24,266 24,938 74,478 81,607 
Depreciation and amortization expenseDepreciation and amortization expense173,500 169,285 Depreciation and amortization expense177,677 164,706 533,255 510,400 
Transaction costsTransaction costs331 615 Transaction costs1,888 307 2,970 1,254 
Payroll and related costs from management services contractsPayroll and related costs from management services contracts3,505 3,237 Payroll and related costs from management services contracts3,006 2,896 9,166 8,617 
General and administrative expenseGeneral and administrative expense44,959 36,454 General and administrative expense34,560 27,862 117,924 102,059 
Less:Less:Less:
Net operating income attributable to noncontrolling interests in property partnershipsNet operating income attributable to noncontrolling interests in property partnerships44,376 47,661 Net operating income attributable to noncontrolling interests in property partnerships47,800 42,160 138,463 122,248 
Gains (losses) from investments in securitiesGains (losses) from investments in securities1,659 (5,445)Gains (losses) from investments in securities(190)1,858 3,744 965 
Interest and other income (loss)Interest and other income (loss)1,168 3,017 Interest and other income (loss)1,520 (45)4,140 4,277 
Gains on sales of real estate419,654 
Income (loss) from unconsolidated joint ventures5,225 (369)
Gains (losses) on sales of real estateGains (losses) on sales of real estate348 (209)8,104 626,686 
Direct reimbursements of payroll and related costs from management services contractsDirect reimbursements of payroll and related costs from management services contracts3,505 3,237 Direct reimbursements of payroll and related costs from management services contracts3,006 2,896 9,166 8,617 
Development and management services revenueDevelopment and management services revenue6,803 7,879 Development and management services revenue6,094 7,281 20,181 23,285 
Company’s share of Net Operating IncomeCompany’s share of Net Operating Income$424,366 $452,750 Company’s share of Net Operating Income$435,195 $404,444 $1,291,860 $1,255,082 
Net operating income (“NOI”) is a non-GAAP financial measure equal to net income attributable to Boston Properties, Inc. common shareholders and net income attributable to Boston Properties Limited Partnership common unitholders, as applicable, the most directly comparable GAAP financial measures, plus (1) preferred stock/unit redemption charge, preferred dividends/distributions, net income attributable to noncontrolling interests, interest expense, losses from early extinguishment of debt, loss from unconsolidated joint ventures, depreciation and amortization expense, transaction costs, payroll and related costs from management services contracts and corporate general and administrative expense less (2) gains (losses) from investments in securities, interest and other income (loss), gains (losses) on sales of real estate, income (loss) from unconsolidated joint ventures, direct reimbursements of payroll and related costs from management services contracts and development and management services revenue. The Company believes NOI is useful to investors as a performance measure and believes it provides useful information to investors regarding its results of operations and financial condition because, when compared across periods, it reflects the impact on operations from trends in occupancy rates, rental rates, operating costs and acquisition and development activity on an unleveraged basis, providing perspective not immediately apparent from net income attributable to Boston Properties, Inc. common shareholders and net income attributable to Boston Properties Limited Partnership common unitholders. For example, interest expense is not necessarily linked to the operating performance of a real estate asset and is often incurred at the corporate level as opposed to the property level. Similarly, interest expense may be incurred at the property level even though the financing proceeds may be used at the corporate level (e.g., used for other investment activity). In addition, depreciation and amortization expense, because of historical cost accounting and useful life estimates, may distort operating performance measures at the property level. NOI
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presented by the Company may not be comparable to NOI reported by other REITs or real estate companies that define NOI differently.
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The Company’s internal reporting utilizes its share of NOI, which includes its share of NOI from consolidated and unconsolidated joint ventures, which is a non-GAAP financial measure that is calculated as the consolidated amount, plus the Company’s share of the amount from the Company’s unconsolidated joint ventures (calculated based upon the Company’s economic percentage ownership interest and, in some cases, after priority allocations), minus the Company’s partners’ share of the amount from the Company’s consolidated joint ventures (calculated based upon the partners’ economic percentage ownership interests and, in some cases, after priority allocations, income allocation to private REIT shareholders and their share of fees due to the Company). The Company’s share of NOI from unconsolidated joint ventures does not include its share of gains on sales of real estate from unconsolidated joint ventures and gain on sale of investment from unconsolidated joint ventures, both of which are included within IncomeLoss From Unconsolidated Joint Ventures in the Company’s Consolidated Statements of Operations.  Management utilizes its share of NOI in assessing its performance as the Company has several significant joint ventures and, in some cases, the Company exercises significant influence over, but does not control, the joint venture, in which case GAAP requires that the Company account for the joint venture entity using the equity method of accounting and the Company does not consolidate it for financial reporting purposes. In other cases, GAAP requires that the Company consolidate the venture even though the Company’s partner(s) owns a significant percentage interest. As a result, the presentations of the Company’s share of NOI should not be considered a substitute for, and should only be considered together with and as a supplement to, the Company’s financial information presented in accordance with GAAP.
Asset information by segment is not reported because the Company does not use this measure to assess performance. Therefore, depreciation and amortization expense is not allocated among segments. Preferred stock/unit redemption charge, preferred dividends/distributions, interest expense, losses from early extinguishment of debt, loss from unconsolidated joint ventures, depreciation and amortization expense, transaction costs, payroll and related costs from management services contracts, corporate general and administrative expense, gains (losses) from investments in securities, interest and other income (loss), gains (losses) on sales of real estate, income (loss) from unconsolidated joint ventures, direct reimbursements of payroll and related costs from management services contracts and development and management services revenue are not included in NOI and are provided as reconciling items to the Company’s reconciliations of its share of NOI to net income attributable to common shareholders/unitholders.
The Company’s segments are based on the Company’s method of internal reporting which classifies its operations by geographic area. The Company’s segments by geographic area are Boston, Los Angeles, New York, San Francisco, Seattle and Washington, DC. On September 1, 2021, the Company invested into a joint venture that acquired Safeco Plaza located in Seattle, Washington (See Note 5). As such, the Seattle region was identified as a segment during the third quarter of 2021. The Company also presents information for each segment by property type, including Office, Residential and Hotel.
Included within the Office property type are commercial office and retail leases, as well as parking revenue.  Upon the adoption of ASC 842, anyAny write-off for bad debt, including accrued rent, will be recorded as a reduction to lease revenue. As a result of COVID-19, duringDuring the three nine months ended March 31,September 30, 2021, the Company wrote off approximately $0.6$1.3 million related to accrued rent, net balances and approximately $(0.2) million related to accounts receivable, net balances. During the three months ended March 31, 2020, the Company wrote off approximately $1.2 millionThere were no write-offs related to accrued rent, net balances and accounts receivable, net balances for the three months ended September 30, 2021. During the three and nine months ended September 30, 2020, the Company wrote off approximately $0.3$7.5 million and $63.8 million, respectively, related to accrued rent, net balances and accounts receivable, net balances. The write-offs were for tenants, primarily in the retail sector, that either terminated their leases or thatfor which the Company considered their accrued rent and/or accounts receivable balances were no longer probable of collection.
In addition, parking and other revenue for the three months ended September 30, 2021 increased by approximately $7.2 million compared to the three months ended March 31,September 30, 2020. Parking and other revenue for the nine months ended September 30, 2021 decreasedincreased by approximately $7.6$4.0 million compared to 2020. These decreases were primarily in transient and monthly parking revenue.
The Boston Marriott Cambridge closed in March 2020 due to COVID-19. The hotel re-opened on October 2, 2020 and it has operated at a diminishedlower occupancy levels due to the continued impact of COVID-19 on business and leisure travel. The closing of the hotel for more than two fiscal quarters, weakand the lower demand and low occupancy since its re-opening, have had, and are expected to continue to have, a material adverse effect on the hotel’s operations and thus the results of the Company’s Hotel property type.
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Information by geographic area and property type (dollars in thousands):
For the three months ended March 31,September 30, 2021:
BostonLos AngelesNew YorkSan FranciscoWashington, DCTotalBostonLos AngelesNew YorkSan FranciscoSeattleWashington, DCTotal
Rental Revenue: (1)Rental Revenue: (1)Rental Revenue: (1)
OfficeOffice$230,403 $$250,164 $130,598 $82,415 $693,580 Office$236,080 $— $257,656 $125,340 $— $85,797 $704,873 
ResidentialResidential3,045 321 5,809 9,175 Residential3,418 — — 806 — 6,670 10,894 
HotelHotel632 632 Hotel5,189 — — — — — 5,189 
TotalTotal234,080 250,164 130,919 88,224 703,387 Total244,687 — 257,656 126,146 — 92,467 720,956 
% of Grand Totals% of Grand Totals33.28 %%35.57 %18.61 %12.54 %100.00 %% of Grand Totals33.93 %— %35.74 %17.50 %— %12.83 %100.00 %
Rental Expenses:Rental Expenses:Rental Expenses:
OfficeOffice79,881 99,385 40,249 31,747 251,262 Office82,697 — 94,338 43,582 — 31,619 252,236 
ResidentialResidential1,455 1,686 2,986 6,127 Residential1,396 — — 1,688 — 2,961 6,045 
HotelHotel2,051 2,051 Hotel3,946 — — — — — 3,946 
TotalTotal83,387 99,385 41,935 34,733 259,440 Total88,039 — 94,338 45,270 — 34,580 262,227 
% of Grand Totals% of Grand Totals32.14 %%38.31 %16.16 %13.39 %100.00 %% of Grand Totals33.57 %— %35.98 %17.26 %— %13.19 %100.00 %
Net operating incomeNet operating income$150,693 $$150,779 $88,984 $53,491 $443,947 Net operating income$156,648 $— $163,318 $80,876 $— $57,887 $458,729 
% of Grand Totals% of Grand Totals33.94 %%33.97 %20.04 %12.05 %100.00 %% of Grand Totals34.15 %— %35.60 %17.63 %— %12.62 %100.00 %
Less: Net operating income attributable to noncontrolling interests in property partnershipsLess: Net operating income attributable to noncontrolling interests in property partnerships(10,224)(34,152)(44,376)Less: Net operating income attributable to noncontrolling interests in property partnerships(10,841)— (36,959)— — — (47,800)
Add: Company’s share of net operating income from unconsolidated joint venturesAdd: Company’s share of net operating income from unconsolidated joint ventures2,281 14,192 (793)3,480 5,635 24,795 Add: Company’s share of net operating income from unconsolidated joint ventures3,464 12,078 104 3,502 671 4,447 24,266 
Company’s share of net operating incomeCompany’s share of net operating income$142,750 $14,192 $115,834 $92,464 $59,126 $424,366 Company’s share of net operating income$149,271 $12,078 $126,463 $84,378 $671 $62,334 $435,195 
% of Grand Totals% of Grand Totals33.64 %3.34 %27.30 %21.79 %13.93 %100.00 %% of Grand Totals34.30 %2.78 %29.06 %19.39 %0.15 %14.32 %100.00 %
  _______________
(1)Rental Revenue is equal to Total Revenue per the Company’s Consolidated Statements of Operations, less Development and Management Services Revenue and Direct Reimbursements of Payroll and Related Costs from Management Services Contracts Revenue per the Consolidated Statements of Operations.
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For the three months ended March 31,September 30, 2020:
BostonLos AngelesNew YorkSan FranciscoWashington, DCTotalBostonLos AngelesNew YorkSan FranciscoWashington, DCTotal
Rental Revenue: (1)Rental Revenue: (1)Rental Revenue: (1)
OfficeOffice$239,498 $$255,286 $136,739 $93,136 $724,659 Office$225,652 $— $239,535 $128,165 $79,931 $673,283 
ResidentialResidential4,068 5,888 9,956 Residential3,043 — — 23 6,652 9,718 
HotelHotel6,825 6,825 Hotel90 — — — — 90 
TotalTotal250,391 255,286 136,739 99,024 741,440 Total228,785 — 239,535 128,188 86,583 683,091 
% of Grand Totals% of Grand Totals33.77 %%34.43 %18.44 %13.36 %100.00 %% of Grand Totals33.48 %— %35.07 %18.77 %12.68 %100.00 %
Rental Expenses:Rental Expenses:Rental Expenses:
OfficeOffice82,545 99,140 42,569 34,648 258,902 Office81,890 — 97,904 41,518 31,994 253,306 
ResidentialResidential1,340 2,724 4,064 Residential1,350 — — 740 2,865 4,955 
HotelHotel6,821 6,821 Hotel3,164 — — — — 3,164 
TotalTotal90,706 99,140 42,569 37,372 269,787 Total86,404 — 97,904 42,258 34,859 261,425 
% of Grand Totals% of Grand Totals33.62 %%36.75 %15.78 %13.85 %100.00 %% of Grand Totals33.05 %— %37.46 %16.16 %13.33 %100.00 %
Net operating incomeNet operating income$159,685 $$156,146 $94,170 $61,652 $471,653 Net operating income$142,381 $— $141,631 $85,930 $51,724 $421,666 
% of Grand Totals% of Grand Totals33.85 %%33.11 %19.97 %13.07 %100.00 %% of Grand Totals33.77 %— %33.58 %20.38 %12.27 %100.00 %
Less: Net operating income attributable to noncontrolling interests in property partnershipsLess: Net operating income attributable to noncontrolling interests in property partnerships(10,663)(36,998)(47,661)Less: Net operating income attributable to noncontrolling interests in property partnerships(10,228)— (31,932)— — (42,160)
Add: Company’s share of net operating income from unconsolidated joint venturesAdd: Company’s share of net operating income from unconsolidated joint ventures3,099 15,930 756 3,159 5,814 28,758 Add: Company’s share of net operating income from unconsolidated joint ventures2,764 11,953 539 4,098 5,584 24,938 
Company’s share of net operating incomeCompany’s share of net operating income$152,121 $15,930 $119,904 $97,329 $67,466 $452,750 Company’s share of net operating income$134,917 $11,953 $110,238 $90,028 $57,308 $404,444 
% of Grand Totals% of Grand Totals33.60 %3.52 %26.48 %21.50 %14.90 %100.00 %% of Grand Totals33.35 %2.96 %27.26 %22.26 %14.17 %100.00 %
  _______________
(1)Rental Revenue is equal to Total Revenue per the Company’s Consolidated Statements of Operations, less Development and Management Services Revenue and Direct Reimbursements of Payroll and Related Costs from Management Services Contracts Revenue per the Consolidated Statements of Operations.

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For the nine months ended September 30, 2021:
BostonLos AngelesNew YorkSan FranciscoSeattleWashington, DCTotal
Rental Revenue: (1)
Office$696,054 $— $760,002 $382,119 $— $252,822 $2,090,997 
Residential9,594 — — 1,817 — 18,421 29,832 
Hotel7,382 — — — — — 7,382 
Total713,030 — 760,002 383,936 — 271,243 2,128,211 
% of Grand Totals33.50 %— %35.71 %18.04 %— %12.75 %100.00 %
Rental Expenses:
Office240,743 — 286,385 124,785 — 94,360 746,273 
Residential4,286 — — 4,918 — 8,896 18,100 
Hotel7,993 — — — — — 7,993 
Total253,022 — 286,385 129,703 — 103,256 772,366 
% of Grand Totals32.76 %— %37.08 %16.79 %— %13.37 %100.00 %
Net operating income$460,008 $— $473,617 $254,233 $— $167,987 $1,355,845 
% of Grand Totals33.93 %— %34.93 %18.75 %— %12.39 %100.00 %
Less: Net operating income attributable to noncontrolling interests in property partnerships(31,641)— (106,822)— — — (138,463)
Add: Company’s share of net operating income from unconsolidated joint ventures9,369 38,535 (517)10,562 671 15,858 74,478 
Company’s share of net operating income$437,736 $38,535 $366,278 $264,795 $671 $183,845 $1,291,860 
% of Grand Totals33.88 %2.98 %28.35 %20.50 %0.05 %14.24 %100.00 %
  _______________
(1)Rental Revenue is equal to Total Revenue per the Company’s Consolidated Statements of Operations, less Development and Management Services Revenue and Direct Reimbursements of Payroll and Related Costs from Management Services Contracts Revenue per the Consolidated Statements of Operations.

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For the nine months ended September 30, 2020:
BostonLos AngelesNew YorkSan FranciscoWashington, DCTotal
Rental Revenue: (1)
Office$683,501 $— $699,063 $393,137 $256,904 $2,032,605 
Residential10,512 — — 23 18,541 29,076 
Hotel7,014 — — — — 7,014 
Total701,027 — 699,063 393,160 275,445 2,068,695 
% of Grand Totals33.89 %— %33.79 %19.01 %13.31 %100.00 %
Rental Expenses:
Office240,129 — 285,411 123,168 99,322 748,030 
Residential3,925 — — 740 8,319 12,984 
Hotel11,958 — — — — 11,958 
Total256,012 — 285,411 123,908 107,641 772,972 
% of Grand Totals33.12 %— %36.92 %16.03 %13.93 %100.00 %
Net operating income$445,015 $— $413,652 $269,252 $167,804 $1,295,723 
% of Grand Totals34.35 %— %31.92 %20.78 %12.95 %100.00 %
Less: Net operating income attributable to noncontrolling interests in property partnerships(31,467)— (90,781)— — (122,248)
Add: Company’s share of net operating income from unconsolidated joint ventures8,490 42,909 2,110 11,384 16,714 81,607 
Company’s share of net operating income$422,038 $42,909 $324,981 $280,636 $184,518 $1,255,082 
% of Grand Totals33.63 %3.42 %25.89 %22.36 %14.70 %100.00 %
  _______________
(1)Rental Revenue is equal to Total Revenue per the Company’s Consolidated Statements of Operations, less Development and Management Services Revenue and Direct Reimbursements of Payroll and Related Costs from Management Services Contracts Revenue per the Consolidated Statements of Operations.

13. Earnings Per Share / Common Unit
Boston Properties, Inc.
The following table provides a reconciliation of both the net income attributable to Boston Properties, Inc. common shareholders and the number of common shares used in the computation of basic earnings per share (“EPS”), which is calculated by dividing net income attributable to Boston Properties, Inc. common shareholders by the weighted-average number of common shares outstanding during the period. Unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are also participating securities. As such, unvested restricted common stock of Boston Properties, Inc. and Boston Properties Limited Partnership’s LTIP Units, 2012 OPP Units and MYLTIP Units are considered participating securities. Participating securities are included in the computation of basic EPS of Boston Properties, Inc. using the two-class method. Participating securities are included in the computation of diluted EPS of Boston Properties, Inc. using the if-converted method if the impact is dilutive. Because the 2012 OPP Units and 2013 - 2018 MYLTIP Units required, and the 2019 - 2021 MYLTIP Units require, Boston Properties, Inc. to outperform absolute and/or relative return thresholds, unless such thresholds have been met by the end of the applicable reporting period, Boston Properties, Inc. excludes such units from the diluted EPS calculation. Other potentially dilutive common shares, including stock options, restricted stock and other securities of Boston Properties Limited Partnership that are exchangeable for Boston Properties, Inc.’s Common Stock, and the related impact on earnings, are considered when calculating diluted EPS.
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Three months ended March 31, 2021Three months ended September 30, 2021
Income
(Numerator)
Shares
(Denominator)
Per Share
Amount
Income
(Numerator)
Shares
(Denominator)
Per Share
Amount
(in thousands, except for per share amounts)(in thousands, except for per share amounts)
Basic Earnings:Basic Earnings:Basic Earnings:
Net income attributable to Boston Properties, Inc. common shareholdersNet income attributable to Boston Properties, Inc. common shareholders$91,624 155,928 $0.59 Net income attributable to Boston Properties, Inc. common shareholders$108,297 156,183 $0.69 
Effect of Dilutive Securities:Effect of Dilutive Securities:Effect of Dilutive Securities:
Stock Based CompensationStock Based Compensation171 Stock Based Compensation— 415 — 
Diluted Earnings:Diluted Earnings:Diluted Earnings:
Net income attributable to Boston Properties, Inc. common shareholdersNet income attributable to Boston Properties, Inc. common shareholders$91,624 156,099 $0.59 Net income attributable to Boston Properties, Inc. common shareholders$108,297 156,598 $0.69 
Three months ended March 31, 2020Three months ended September 30, 2020
Income
(Numerator)
Shares
(Denominator)
Per Share
Amount
Income
(Numerator)
Shares
(Denominator)
Per Share
Amount
(in thousands, except for per share amounts)(in thousands, except for per share amounts)
Basic Earnings:Basic Earnings:Basic Earnings:
Net income attributable to Boston Properties, Inc. common shareholders$497,496 155,011 $3.21 
Allocation of undistributed earnings to participating securities(1,011)(0.01)
Net income attributable to Boston Properties, Inc. common shareholdersNet income attributable to Boston Properties, Inc. common shareholders$496,485 155,011 $3.20 Net income attributable to Boston Properties, Inc. common shareholders$89,854 155,645 $0.58 
Effect of Dilutive Securities:Effect of Dilutive Securities:Effect of Dilutive Securities:
Stock Based CompensationStock Based Compensation247 Stock Based Compensation— 25 — 
Diluted Earnings:Diluted Earnings:Diluted Earnings:
Net income attributable to Boston Properties, Inc. common shareholdersNet income attributable to Boston Properties, Inc. common shareholders$496,485 155,258 $3.20 Net income attributable to Boston Properties, Inc. common shareholders$89,854 155,670 $0.58 
 Nine months ended September 30, 2021
 Income
(Numerator)
Shares
(Denominator)
Per Share
Amount
 (in thousands, except for per share amounts)
Basic Earnings:
Net income attributable to Boston Properties, Inc. common shareholders$311,680 156,062 $2.00 
Effect of Dilutive Securities:
Stock Based Compensation— 332 (0.01)
Diluted Earnings:
Net income attributable to Boston Properties, Inc. common shareholders$311,680 156,394 $1.99 
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 Nine months ended September 30, 2020
 Income
(Numerator)
Shares
(Denominator)
Per Share
Amount
 (in thousands, except for per share amounts)
Basic Earnings:
Net income attributable to Boston Properties, Inc. common shareholders$854,541 155,349 $5.50 
Allocation of undistributed earnings to participating securities(1,150)— (0.01)
Net income attributable to Boston Properties, Inc. common shareholders$853,391 155,349 $5.49 
Effect of Dilutive Securities:
Stock Based Compensation— 98 — 
Diluted Earnings:
Net income attributable to Boston Properties, Inc. common shareholders$853,391 155,447 $5.49 
Boston Properties Limited Partnership
The following table provides a reconciliation of both the net income attributable to Boston Properties Limited Partnership common unitholders and the number of common units used in the computation of basic earnings per common unit, which is calculated by dividing net income attributable to Boston Properties Limited Partnership common unitholders by the weighted-average number of common units outstanding during the period. Unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are also participating securities. As such, unvested restricted common stock of Boston Properties, Inc. and Boston Properties Limited Partnership’s LTIP Units, 2012 OPP Units and MYLTIP Units are considered participating securities. Participating securities are included in the computation of basic earnings per common unit using the two-class method. Participating securities are included in the computation of diluted earnings per common unit using the if-converted method if the impact is dilutive. Because the 2012 OPP Units and 2013 - 2018 MYLTIP Units required, and the 2019 - 2021 MYLTIP Units require, Boston Properties, Inc. to outperform absolute and/or relative return thresholds, unless such thresholds have been met by the end of the applicable reporting period, Boston Properties Limited Partnership excludes such units from the diluted earnings per common unit calculation. Other potentially dilutive common units and the related impact on earnings are considered when calculating diluted earnings per common unit. Included in the number of units (the denominator) below are approximately 17,089,00017,011,000 and 17,538,00017,032,000 redeemable common units for the three months ended March 31,September 30, 2021 and 2020, respectively, and 17,016,000 and 17,279,000 redeemable common units for the nine months ended September 30, 2021, and 2020, respectively.
 Three months ended September 30, 2021
 Income
(Numerator)
Units
(Denominator)
Per Unit
Amount
 (in thousands, except for per unit amounts)
Basic Earnings:
Net income attributable to Boston Properties Limited Partnership common unitholders$122,014 173,194 $0.70 
Effect of Dilutive Securities:
Stock Based Compensation— 415 — 
Diluted Earnings:
Net income attributable to Boston Properties Limited Partnership common unitholders$122,014 173,609 $0.70 
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Three months ended March 31, 2021Three months ended September 30, 2020
Income
(Numerator)
Units
(Denominator)
Per Unit
Amount
Income
(Numerator)
Units
(Denominator)
Per Unit
Amount
(in thousands, except for per unit amounts)(in thousands, except for per unit amounts)
Basic Earnings:Basic Earnings:Basic Earnings:
Net income attributable to Boston Properties Limited Partnership common unitholdersNet income attributable to Boston Properties Limited Partnership common unitholders$105,773 173,018 $0.61 Net income attributable to Boston Properties Limited Partnership common unitholders$101,624 172,677 $0.59 
Effect of Dilutive Securities:Effect of Dilutive Securities:Effect of Dilutive Securities:
Stock Based CompensationStock Based Compensation171 Stock Based Compensation— 25 — 
Diluted Earnings:Diluted Earnings:Diluted Earnings:
Net income attributable to Boston Properties Limited Partnership common unitholdersNet income attributable to Boston Properties Limited Partnership common unitholders$105,773 173,189 $0.61 Net income attributable to Boston Properties Limited Partnership common unitholders$101,624 172,702 $0.59 
Three months ended March 31, 2020
Income
(Numerator)
Units
(Denominator)
Per Unit
Amount
(in thousands, except for per unit amounts)
Basic Earnings:
Net income attributable to Boston Properties Limited Partnership common unitholders$566,333 172,549 $3.28 
Allocation of undistributed earnings to participating securities(1,126)
Net income attributable to Boston Properties Limited Partnership common unitholders$565,207 172,549 $3.28 
Effect of Dilutive Securities:
Stock Based Compensation247 (0.01)
Diluted Earnings:
Net income attributable to Boston Properties Limited Partnership common unitholders$565,207 172,796 $3.27 
Nine months ended September 30, 2021
Income
(Numerator)
Units
(Denominator)
Per Unit
Amount
(in thousands, except for per unit amounts)
Basic Earnings:
Net income attributable to Boston Properties Limited Partnership common unitholders$353,633 173,078 $2.04 
Effect of Dilutive Securities:
Stock Based Compensation— 332 — 
Diluted Earnings:
Net income attributable to Boston Properties Limited Partnership common unitholders$353,633 173,410 $2.04 
 Nine months ended September 30, 2020
 Income
(Numerator)
Units
(Denominator)
Per Unit
Amount
 (in thousands, except for per unit amounts)
Basic Earnings:
Net income attributable to Boston Properties Limited Partnership common unitholders$969,932 172,628 $5.62 
Allocation of undistributed earnings to participating securities(1,278)— (0.01)
Net income attributable to Boston Properties Limited Partnership common unitholders$968,654 172,628 $5.61 
Effect of Dilutive Securities:
Stock Based Compensation— 98 — 
Diluted Earnings:
Net income attributable to Boston Properties Limited Partnership common unitholders$968,654 172,726 $5.61 
14. Stock Option and Incentive Plan
On February 2, 2021, Boston Properties, Inc.’s Compensation Committee approved the 2021 MYLTIP awards under the Boston Properties, Inc. 2012 Stock Option and Incentive Plan (the “2012 Plan”) to certain officers and employees of Boston Properties, Inc. The 2021 MYLTIP awards consist of two, equally-weightedequally weighted (50% each) components that utilize Boston Properties, Inc.’s TSR over a three-year measurement period as the performance metric.
The first component of the 2021 MYLTIP, which represents one-half (50%) of the target grant-date value, retains the basic general structure of the 2020 MYLTIP awards with certain changes, including a change to the
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custom peer index against which Boston Properties, Inc.’s TSR is compared. The number of LTIP Units that can be earned under this component ranges from zero to 200% of the target number of LTIP Units, based on Boston Properties, Inc.’s annualized relative TSR performance compared to a custom index. Under this component, 100% of the target number of LTIP Units will be earned if Boston Properties, Inc.’s TSR equals the custom index TSR; for relative TSR performance between -1,000 basis points and +1,000 basis points, the number of LTIP Units earned will be determined using linear interpolation.
The second component represents the remaining one-half (50%) of the target grant-date value of the 2021 MYLTIP. The number of LTIP Units that can be earned under this component ranges from zero to 200% of the target number of LTIP Units, based on Boston Properties, Inc.’s cumulative absolute TSR during the performance period. Under this component, 100% of the target number of LTIP Units will be earned if Boston Properties, Inc.’s achieves an absolute TSR equal to +1,000 basis points; if Boston Properties, Inc.’s absolute TSR is greater than -4,000 basis points but less than +6,000 basis points, then the number of LTIP Units earned will be determined using linear interpolation.
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Total earned awards under the 2021 MYLTIP, if any, iswill equal the sum of the number of LTIP Units earned under the first and second components and will range from 0zero to a maximum of 352,021 LTIP Units with a target of approximately 176,009 LTIP Units and linear interpolation between zero and maximum. Earned awards (if any) will vest 100% on February 1, 2024, but may not be converted, redeemed, sold or otherwise transferred for one additional year thereafter. Vesting will be accelerated in the event of a change in control, termination of employment by Boston Properties, Inc. without cause, or termination of employment by the award recipient for good reason, death, disability or retirement. If there is a change of control prior to February 1, 2024, earned awards will be calculated based on TSR performance up to the date of the change of control. The 2021 MYLTIP awards are in the form of LTIP Units issued on the grant date, and they are subject to forfeiture to the extent awards are not earned. Prior to the performance measurement date holders of the 2021 MYLTIP Units are only entitled to one-tenth (10%) of the regular quarterly distributions payable on common partnership units. Following the completion of the three-year performance period, Boston Properties, Inc. will also make a “catch-up” cash payment on the 2021 MYLTIP Units that are ultimately earned in an amount equal to the regular and special distributions, if any, declared during the performance period on Boston Properties, Inc.’s common stock, less the distributions actually paid to holders of 2021 MYLTIP Units during the performance period on all of the awarded 2021 MYLTIP Units. Under ASC 718 “Compensation - Stock Compensation,” the 2021 MYLTIP awards have an aggregate value of approximately $15.3 million, which amount will generally be amortized into earnings under the graded vesting method.
On February 5, 2021, the measurement period for the Company’s 2018 MYLTIP awards ended and, based on Boston Properties, Inc.’s relative TSR performance, the final awards were determined to be 29.2% of target, or an aggregate of approximately $4.6 million (after giving effect to employee separations). As a result, an aggregate of 285,925 2018 MYLTIP Units that had been previously granted were automatically forfeited.
At Boston Properties, Inc.’s 2021 annual meeting of stockholders held on May 20, 2021, its stockholders approved the Boston Properties, Inc. 2021 Stock Incentive Plan (the “2021 Plan”). The 2021 Plan replaces the 2012 Plan and no further awards will be granted under the 2012 Plan. The material features of the 2021 Plan include, among other things: (i) the maximum number of shares of Common Stock reserved and available for issuance under the 2021 Plan is 5,400,000 shares less one share for every one share that was granted between March 4, 2021 and May 19, 2021 under the 2012 Plan, (ii) shares of Common Stock underlying awards granted under the 2021 Plan or the 2012 Plan that are forfeited, canceled or otherwise terminated (other than by exercise) will be added back to the shares of Common Stock available for issuance under the 2021 Plan and, with respect to “full-value” awards under the 2021 Plan or the 2012 Plan, shares tendered or held back for taxes and shares previously reserved for issuance pursuant to such an award to the extent that such shares are not issued and are no longer issuable pursuant to such an award (e.g., in the event that a full-value award that may be settled in cash or by issuance of shares of Common Stock is settled in cash) will be added back to the shares available for issuance under the 2021 Plan, (iii) the award of stock options (both incentive and non-qualified options), stock appreciation rights, restricted stock units, restricted stock, unrestricted stock, dividend equivalent rights, cash-based awards and other equity-based awards (including LTIP Units) is permitted, (iv) stock options may not be repriced and “underwater” stock options may not be exchanged for another award or cash without stockholder approval; and (v) the term of the 2021 Plan is for ten years from the date of stockholder approval.
During the threenine months ended March 31,September 30, 2021, Boston Properties, Inc. issued 34,64456,841 shares of restricted common stock and Boston Properties Limited Partnership issued 273,930281,640 LTIP Units and 352,021 2021 MYLTIP Units to employees and non-employee director advisors under the 2012 Plan and the 2021 Plan. Employees paid $0.01 per share of restricted common stock and $0.25 per LTIP Unit and 2021 MYLTIP Unit. When issued, LTIP
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Units are not economically equivalent in value to a share of Common Stock, but over time can increase in value to one-for-one parity with Common Stock if there is sufficient appreciation in the value of the Company’s assets. The aggregate value of the LTIP Units is included in noncontrolling interests in the Consolidated Balance Sheets of Boston Properties, Inc. and Boston Properties Limited Partnership. A substantial majority of the grants of restricted common stock and LTIP Units to employees vest in four equal annual installments. Restricted common stock is measured at fair value on the date of grant based on the number of shares granted and the closing price of Boston Properties, Inc.’s 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. The shares of restricted common stock granted during the threenine months ended March 31,September 30, 2021 were valued at approximately $3.2$5.7 million ($91.67100.46 per share weighted-average). The LTIP Units granted were valued at approximately $23.0$23.8 million (approximately $83.85$84.43 per unit weighted-average fair value) using a Monte Carlo simulation method model. The per unit fair values of the LTIP Units granted were estimated on the dates of grant and for a substantial majority of such units were valued using the following assumptions: an expected life of 5.7 years, a risk-free interest rate of 0.65% and an expected price volatility of 30.0%. Because the 2012 OPP Units and 2013 - 2021 MYLTIP Units are subject to both a service condition and a market condition, the Company recognizes the related compensation expense under the graded vesting attribution method. Under the graded vesting attribution method, each portion of the award that vests at a different date is accounted for as a separate award and recognized over the period appropriate to that portion so that the compensation cost for each portion should be recognized in full by the time that portion vests. The Company recognizes forfeitures as they occur on its awards of stock-based compensation. Dividends paid on both vested and unvested shares of restricted stock are charged directly to Dividends in Excess of Earnings in Boston Properties, Inc.’s Consolidated Balance Sheets and Partners’ Capital in Boston Properties Limited Partnership’s Consolidated Balance Sheets. Aggregate stock-based compensation expense associated with restricted stock, LTIP Units and 2016 - 2021 MYLTIP Units was approximately $19.8$8.4 million and $17.2$8.0 million for the three months ended March 31,September 30, 2021 and 2020, respectively, and $42.2 million and $35.3 million for the nine months ended September 30, 2021 and 2020, respectively. At March 31,September 30, 2021, there was (1) an aggregate of approximately $33.4$28.4 million of unrecognized compensation expense related to unvested restricted stock, LTIP Units and 2018 MYLTIP Units and (2) an aggregate of approximately $19.2$9.4 million of unrecognized compensation expense related to unvested 2019 - 2021 MYLTIP Units that is expected to be recognized over a weighted-average period of approximately 2.42.1 years.


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15. Subsequent Events
On April 1,October 15, 2021, Boston Properties Inc. redeemed 80,000 shares of Series B Preferred Stock (includingLimited Partnership used available cash and funds under its 2021 Credit Facility to complete the corresponding 8,000,000 Depositary Shares), which represented all of the outstanding shares of Series B Preferred Stock. Upon redemption of the Series B Preferred Stock, all outstanding shares$1.0 billion in aggregate principal amount of the Series B Preferred Units,its 3.85% senior notes due February 1, 2023. The redemption price was approximately $1.05 billion, which had terms and preferences generally mirroring those of the Series B Preferred Stock, were redeemed by Boston Properties Limited Partnership. The Company paid an aggregate $201.3 million including $1.3included approximately $7.9 million of accrued butand unpaid interest (See Note 11).to, but not including, the redemption date and an early redemption premium and unamortized financing costs totaling approximately $43.9 million.
On May 3,October 19, 2021, the Company entered into an agreement to acquire two life sciences lab buildings located in Waltham, Massachusetts forpartially placed in-service Reston Next, a purchase price of Class A office project with
approximately $100.0 million. These 2 life sciences lab buildings aggregate approximately 137,0001.1 million net rentable square feet. Thefeet located in Reston, Virginia.
On October 25, 2021, the Company completed the sale of its 181,191 and 201 Spring Street properties located in Lexington, Massachusetts for an aggregate gross sales price of $191.5 million. 181,191 and 201 Spring Street are 3 Class A office properties aggregating approximately 333,000 net rentable square feet and are 100% leased. The
On October 29, 2021, a joint venture in which the Company expects to close on the acquisition during the second quarter of 2021. The transaction is subject to the satisfaction of customary closing conditions. There can be no assurance that the acquisition will be consummated on the terms currently contemplated, or at all.has a 50% interest fully placed in-service 7750 Wisconsin Avenue, a Class A office project with approximately 734,000 net rentable square feet located in Bethesda, Maryland.

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ITEM 2—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.
This Quarterly Report on Form 10-Q, including the documents incorporated by reference, contain forward-looking statements within the meaning of the federal securities laws, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. We intend these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and are including this statement for purposes of complying with those safe harbor provisions, in each case, to the extent applicable. Such statements are contained principally, but not only, under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” We caution investors that any such forward-looking statements are based on current beliefs or expectations of future events and on assumptions made by, and information currently available to, our management. When used, the words “anticipate,” “believe,” “budget,” “could”, “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “project,” “should,” “will” and similar expressions that 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 or occurrences, which may be affected by known and unknown risks, trends, uncertainties and factors that are, in some cases, beyond our control. Should one or more of these known or unknown risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those expressed or implied by the forward-looking statements. We caution you that, while forward-looking statements reflect our good-faith beliefs when we make them, they are not guarantees of future performance or occurrences and are impacted by actual events when they occur after we make such statements. Accordingly, investors should use caution in relying on forward-looking statements, which are based on results and trends at the time they are made, to anticipate future results or trends.
OneT of thehe most significant factors that may cause actual results to differ materially from those expressed or implied by the forward-looking statements isinclude the ongoing impact of the global COVID-19 pandemic on the U.S. and global economies, which has impacted, and is likely to continue to impact, us, and, directly or indirectly, many of the other important factors below and the risks described in (i) our Annual Report on Form 10-K for the fiscal year ended December 31, 2020 including those described under the caption “Risk Factors,” (ii) our subsequent filings under the Exchange Act and (iii) the risk factors set forth in this Form 10-Q in Part II, Item 1A.
Some of the risks1A, 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:
the risks and uncertainties related to the impact of the COVID-19 global pandemic, including the duration, scope and severity of the pandemic domestically and internationally; federal, state and local government actions or restrictive measures implemented in response to COVID-19, the effectiveness of such measures, as well as the effect of any relaxation of current restrictions, and the direct and indirect impact of such measures on our and our tenants’ businesses, financial condition, results of operations, cash flows, liquidity, performance and performance,demand for office space, and the U.S. and international economy and economic activity generally; the emergence and characteristics of new variants, the speed, effectiveness and distribution of vaccines (including effectiveness against COVID-19 variant strains), whether new or existing actions and measures continue to impact the ability of our residential tenants to generate sufficient income to pay, or make them unwilling to pay rent in a timely manner, in full or at all; the health, continued service and availability of our personnel, including our key personnel and property management teams; and the effectiveness or lack of effectiveness of governmental relief in providing assistance to individuals and large and small businesses, including our tenants, that have suffered significant adverse effects from COVID-19;
volatile or adverse global economic and political conditions, health crises and dislocations in the credit markets could adversely affect our access to cost-effective capital and have a resulting material adverse effect on our business opportunities, results of operations and financial condition;
general risks affecting the real estate industry (including, without limitation, the inability to enter into or renew leases, tenant space utilization, dependence on tenants’ financial condition, and competition from other developers, owners and operators of real estate);
failure to manage effectively our growth and expansion into new markets and sub-markets or to integrate acquisitions and developments successfully;
the ability of our joint venture partners to satisfy their obligations;
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risks and uncertainties affecting property development and construction (including, without limitation, construction delays, increased construction costs, cost overruns, inability to obtain necessary permits, tenant accounting considerations that may result in negotiated lease provisions that limit a tenant’s liability during construction, and public opposition to such activities);
risks associated with the availability and terms of financing and the use of debt to fund acquisitions and developments or refinance existing indebtedness, including the impact of higher interest rates on the cost and/or availability of financing;
risks associated with forward interest rate contracts and the effectiveness of such arrangements;
risks associated with downturns in the national and local economies, increases in interest rates, and volatility in the securities markets;
risks associated with actual or threatened terrorist attacks;
costs of compliance with the Americans with Disabilities Act and other similar laws;
potential liability for uninsured losses and environmental contamination;
risks associated with the physical effects of climate change;
risks associated with security breaches through cyber attacks, cyber intrusions or otherwise, as well as other significant disruptions of our information technology (IT) networks and related systems, which support our operations and our buildings;
risks associated with BXP’s potential failure to qualify as a REIT under the Internal Revenue Code of 1986, as amended;
possible adverse changes in tax and environmental laws;
the impact of newly adopted accounting principles on our accounting policies and on period-to-period comparisons of financial results;
risks associated with possible state and local tax audits;
risks associated with our dependence on key personnel whose continued service is not guaranteed; and
the other risk factors identified in our most recently filed Annual Report on Form 10-K for the fiscal year ended December 31, 2020 or described herein, including those under the caption “Risk Factors.”

The risks set forth above are not exhaustive. Other sections of this report may include additional factors that could adversely affect our business and financial performance. Moreover, we operate in a very competitive and rapidly changing environment, particularly in light of the circumstances relating to COVID-19. New risk factors emerge from time to time and it is not possible for management to predict all risk factors, nor can we assess the impact of all 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 most recent Annual Report on Form 10-K and 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 Current Reports on Form 8-K or otherwise, for a discussion of risks and uncertainties that may cause actual results, performance or achievements to differ materially from those expressed or implied by forward-looking statements. We expressly disclaim any responsibility to update any forward-looking statements to reflect changes in underlying assumptions or factors, new information, future events, or otherwise, and you should not rely upon these forward-looking statements after the date of this report.
Overview
BXP is one of the largest publicly traded office real estate investment trusts (REITs) (based on total market capitalization as of March 31,September 30, 2021) in the United States that develops, owns and manages primarily Class A office properties. Our properties are concentrated in fivesix markets in the United States - Boston, Los Angeles, New York, San Francisco, Seattle and Washington, DC. BPLP is the entity through which BXP conducts substantially all of its business and owns (either directly or through subsidiaries) substantially all of its assets. We generate revenue and cash primarily by leasing Class A office space to our tenants. When making leasing decisions, we consider, among other things, the creditworthiness of the tenant and the industry in which it conducts business, the length of the lease, the
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the lease, the rental rate to be paid at inception and throughout the lease term, the costs of tenant improvements, free rent periodperiods and other landlord concessions, anticipated operating expenses and real estate taxes, current and anticipated vacancy in our properties and the market overall (including sublease space), current and expected future demand for the space, the impact of any expansion rights and general economic factors.
Our core strategy has always been to develop, acquire and manage high-quality properties in supply-constrained markets with high barriers-to-entry and attractive demand drivers, and to focus on executing long-term leases with financially strong tenants. Historically, these factors have minimized our exposure in weaker economic cycles and enhanced revenues as market conditions improve. Our tenant base is diverse across market sectors and the weighted-average lease term for our in-place leases, excluding residential units, was approximately 7.67.5 years, as of March 31,September 30, 2021, including leases signed by our unconsolidated joint ventures. The weighted-average lease term for our top 20 largest office tenants was approximately 10.710.5 years as of March 31,September 30, 2021.
To be successful in any leasing environment, we believe we must consider all aspects of the tenant-landlord relationship. In this regard, we believe that our competitive leasing advantage is based on the following attributes:
our understanding of tenants’ short- and long-term space utilization and amenity needs in the local markets;
our track record of developing and operating Class A office properties in a sustainable and responsible manner;
our reputation as a premier developer, owner and manager of primarily Class A office properties;
our financial strength and our ability to maintain high building standards; and
our relationships with local brokers.
Outlook
Starting in March 2020,The United States economy continues to recover from the COVID-19 pandemic, negatively affected global macroeconomic conditions. Following a significant a dropalthough quarter-over-quarter GDP growth slowed to an annual rate of 2.0% in U.S. GDP in mid-2020, overall economic conditions beganthe third quarter of 2021 compared to improve6.7% in the second half of 2020 after the enactment of federal stimulus programs. In the first quarter of 2021, millions of Americans began receiving COVID-19 vaccines, and by March 2021,2021. This slowdown reflects the unemployment rate was approximately 6.0%, only 250 basis points above the pre-pandemic rate in February 2020. Although conditions have improved since the middle of 2020, the pandemic continues to weigh on the U.S. economy and operating conditions for several sectors, including commercial real estate, continue to be negatively impacted. The healthimpacts of the overall economyDelta variant and employment trends among professional workersmoderation in government stimulus spending. Since the end of the third quarter, however, daily COVID infection levels have been, and we expect will continue to be, important drivers of office market conditions, and we expect vaccine distribution and efficacy to lead to a recovery of market conditionsdecreased by more than 50% from the recent highs in September 2021. We believe the positive trend in infection rates, combined with relatively low unemployment rates, bodes well for continuing economic growth in our sector.
Although the state and local authorities in many of our regions began easing restrictions on businesses and lifting limitations on the size of gatherings during the second half of 2020 and throughout the first quarter of 2021, the physical occupancy of our properties has remained well below capacity as infection rates fluctuated and most employers continued their COVID-19 response protocols and encouraged employees to work from home when possible.markets.
The future impact of the pandemic on the demand for office spaceoverall economic recovery is unclear, as companies consider thehaving a positive impact on their businessour leasing activity. Although additional COVID variants and their demand for labor while, at the same time, evaluate their space requirements in light of their current and projected headcounts and the continued focus on social distancing and employees’ desire for more work-location flexibility. Real estate is, by nature, a long-term business and we do not believe these considerations and ultimate decisions by tenants will evidence a clear trend in the short-term. In the meantime,supply-chain issues may emerge, we believe as the number of vaccinations increases and employees return to their offices in greater numbers, our strategically located, high-quality office properties will continue to beremain a vital component of the strategies of today’s forward-thinking organizations that desireprioritize fostering collaboration, innovation, productivity and culture, and we expect tenants will take advantage of the availability of Class A space and upgrade.
In the first quarterAnnual inflation increased to 5.4% in September 2021, driven largely by energy prices, which increased approximately 25% compared to one year ago. Energy is a component of 2021,our operating expenses our largest energy cost is electricity. We have limited most of our exposure to additional potential increases through 2022, and we signed approximately 592,000 square feet of new leases and renewals with a weighted-average lease term of approximately 7.6 years, indicating that many prospective and existing tenants continue to commithave been increasing our procurement from green power. We remain exposed to the long-term usemarginal cost of space and view our properties as their preferred choice for a premium Class A office environment. The volume of leasingelectrical generation in the first quarterBoston region where we expect increases in 2022 of 2021 was approximately 84% ofgreater than 10% compared to last year. Costs for security, cleaning and engineering labor continues to increase due to labor shortages across all trades. However, we are able to mitigate the total square feet of leases executed in the first quarter of 2020. We expect leasing volume in 2021risks from these increased costs to remain lower than it was priorour results due to the COVID-19 pandemic as many existing and prospective tenants defer decisions on their office space needs as they focus on workforce management strategies, safely returning their employees to an in-person work environment and managing their businesses through the economic recovery.
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The development of properties in supply-constrained markets with the strongest economic growth over time continues to be a cornerstone of our long-term growth strategy. In the first quarter of 2021, we added new developments and redevelopments to our pipeline of properties under construction, primarily focused on the life sciences sector. The life sciences sector continues to experience strong growth and attract high levels of venture capital investment as demand increases for innovative medicines and therapies to treat an aging U.S. demographic. Cambridge, Boston and the suburban markets of Lexington and Waltham in Massachusetts and South San Francisco and Brisbane in California have been, and continue to be, among the largest life sciences markets, with strong demand from tenants in the life sciences sector because of the close proximity to universities, research institutions and related businesses and concentrations of labor with specialized skills and knowledge specific to this sector.
In the first quarter of 2021, we commenced the development and redevelopment of three properties in two of these markets, including 180 CityPoint, an approximately 329,000 square foot lab development in Waltham, Massachusetts; 880 Winter Street, an approximately 224,000 square foot office property in Waltham, Massachusetts that will be redeveloped and converted into lab space; and 751 Gateway, an approximately 229,000 square foot lab development in South San Francisco, California. 751 Gateway is the first phase of a multi-phase, life sciences campus development at Gateway Commons. Upon completion, we will own 49% of 751 Gateway and future development projects at Gateway Commons. Though all three projects are being commenced speculatively, we are seeing many new life sciences requirements in both the Waltham and South San Francisco markets and have made multiple lease proposals to potential tenants.
Also, in the first quarter of 2021, we commenced the redevelopment of the top three floors of the Prudential Center in Boston, Massachusetts into an approximately 59,000 square foot, world-class observatory attraction. This project will be Boston’s only observatory and will feature a dramatic, 360-degree outdoor viewing deck, 11,000 square feet of outdoor space and two floors of exhibits and observatory spaces, marking a transformative addition to the City of Boston.
In total, as of March 31, 2021, we had approximately 4.3 million square feet of active developments and redevelopments in our pipeline. As of May 3, 2021, the office portion of the development pipeline is 86% pre-leased to predominately credit-strong tenants with long-lease terms and the total development pipeline, inclusive of both office and lab/life sciences developments and excluding The Prudential Center Observatory, is 71% pre-leased. All development projects are projected to meet required delivery milestones as defined in our leases.
Rent Collections
Cash rent payments for a particular month are generally due on the first day of that month (although tenants have varying grace periods). Our reported rent collection amounts are based on the total amount of rent billed by us, including all amounts from consolidated operations and all unconsolidated joint ventures, other than Gateway Commons, our residential properties and one hotel because we do not handle billing.
During the first quarter of 2021, our rent collections as a percentage of the total amounts billed to all tenants were 99.0%.
Approximately 95.2% of the total amounts billed were made to office tenants. Our first quarter rent collections from office tenants continued to be strong at 99.6%. Approximately 91.2%nature of our lease revenuecontracts, which generally take one of two forms: (1) net leases, under which all of the operating expense and real estate taxes are paid by the tenant, and (2) gross leases with a base year that is set upon the lease commencement with increases in expenses over that base year added to the first quarterrental obligation of the tenant. Our near-term exposure to increases in operating expenses is primarily on our vacant space and for new or renewal leases where we are setting a base year. Our vacancy was approximately 11.6% at September 30, 2021, and our 2021 and 2022 lease expirations total approximately 7.6% of our portfolio. We do not expect an increase in operating expenses to have a material adverse effect on our results of operations for the remainder of 2021 was generated by our office portfolio. Our office portfolio has long-term lease contracts and modest rollover exposure over the next few years.or 2022.
Approximately 4.8% of the total amounts billed related to retail leases. Our first quarter rent collections from retail tenants were approximately 89.0%.
Revenue
As a result of the impact of the COVID-19 pandemic on the current economic environment and on the commercial real estate sector in particular, our first quarter 2021 revenues, when compared to first quarter 2020, continued to be adversely affected due to (1) declines in revenue from our retail tenants, parking and our hotel, and (2) a decline in occupancy in our in-service office and retail properties due to a slowdown in new leasing activity for vacant and expiring space.
Our retail tenants continue to be adversely affected by the COVID-19 pandemic. Lease revenue from our retail leases was approximately $45.6 million in the first quarter of 2021, a decrease of approximately $3.3 million from the first quarter of 2020. This amount represents our consolidated lease revenue plus our share of the lease
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revenue from the unconsolidated joint ventures (calculated based on our ownership percentage) minus our partners’ share of lease revenue from our consolidated joint ventures (calculated based upon the partners’ percentage ownership interests). Lease revenue in the first quarter of 2021 included approximately $4.2 million of lease termination income. Excluding termination income, our revenue from retail leases was approximately $41.4 million, a decrease of approximately $7.5 million from the first quarter of 2020, primarily due to tenants that are receiving COVID-19 related rent abatements.
Our hotel property, the Boston Marriott Cambridge, re-opened in October 2020 but operated at diminished occupancy and generated only $0.6 million in revenue in the first quarter of 2021, a decrease of $6.2 million compared to the first quarter of 2020. We expect hotel occupancy to remain low until a sufficient number of people have been vaccinated and the demand for travel and leisure returns to historical levels.
The overall occupancy of our in-service office and retail properties was 88.7% at March 31, 2021, a decrease of 140 basis points compared to 90.1% at December 31, 2020. The decrease was due in part to retail space we recaptured from tenants that defaulted during 2020, as well as the result of a slowdown of leasing activity for available office space due to the ongoing pandemic.BXP Priorities
Despite the concerns surrounding the COVID-19 pandemic and the negativelingering impact on economic conditions in our markets, we continue to beremain optimistic for our industry generally and our company in particular, given low interest rates, the demand
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for workers across sectors, the high quality of our properties, the supply and demand characteristics of our markets and the success of our development efforts. In addition, we anticipate our revenue from retail, parking and our hotel will improve as the rate of vaccinations increases and as the pandemic subsides.
As a leading developer, owner and manager of marquee Class A office properties in the United States, our prioritiesWe remain focused on the following:following priorities:
ensuring tenant health, safety and satisfaction;
leasing available space in our in-service and development properties, as well as proactively focusing on future lease expirations;
completing the construction of our development properties;
continuing and completing the redevelopment and repositioning of several key properties to increase future revenue and asset values over the long-term;
identifying new investment opportunities that meet our criteria while maintaining discipline in our underwriting of investment opportunities;underwriting;
managing our near-term debt maturities and maintaining our conservative balance sheet; and
actively managing our operations in a sustainable and responsible manner.
The following is an overview of portfolio activity, leasing activity and leasingcapital markets activity in the firstthird quarter of 2021.
DuringLeasing Activity and Occupancy
In the firstthird quarter of 2021, we signed leases across our portfolio totaling approximately 592,000 square feet and we commenced revenue recognition on approximately 1.11.4 million square feet of new leases in second-generationand renewals with a weighted-average lease term of approximately 9.2 years, indicating that many new and existing tenants continue to commit to the long-term use of space including lease renewals. Of these second-generation leases, approximately 735,000 square feet had been vacantand view our properties as their preferred choice for less than one year and,a premium Class A office environment. The volume of leasing in the aggregate, they represent an increase in net rental obligations (gross rent less operating expenses)third quarter of approximately 15% over2021 (measured by square feet) was more than double the prior leases.
Consistent with our long-term investment strategy to invest in high-yielding development opportunities,volume achieved in the first quarter of 2021 and approximately 90% of our pre-pandemic historical third quarter average.
The overall occupancy of our in-service office and retail properties was 88.4% at September 30, 2021, a decrease of 0.2% compared to 88.6% at June 30, 2021. We anticipate occupancy for the remainder of 2021 will be relatively flat with occupancy for the third quarter of 2021, but will begin to improve as we head into 2022, as our remaining 2021 and 2022 lease expirations are backfilled by signed leases that have not yet commenced and new leases.
Our parking and other revenue was approximately $23.5 million in the third quarter of 2021, an increase of approximately $5.2 million from the second quarter of 2021. The increase was primarily due to improved transient parking and greater insurance proceeds from a water main break at a New York property. The third quarter 2021 parking and other revenue was 92% of pre-pandemic parking and other revenue from the third quarter of 2019. We expect to return to pre-pandemic levels of parking revenue as workers increasingly return to work in their offices.
Our hotel property, the Boston Marriott Cambridge, generated approximately $1.2 million of net operating income during the third quarter of 2021. This was the first quarter since the start of the pandemic in which the hotel made a positive contribution to our results. Given the hotel’s location in the heart of Cambridge, Massachusetts and adjacent to MIT, we expect hotel occupancy and REVPAR to improve to pre-pandemic levels over time as business and leisure travel return to historical levels.
Investment Activity
We remain committed to developing and acquiring assets to enhance our long-term growth and to meet tenant demand for high-quality office and lab space. We continually evaluate current and prospective markets for possible acquisitions of “value-add” assets that require lease-up or repositioning, and acquisitions that are otherwise consistent with our long-term strategy of owning, managing, developing and improving, premier Class A properties in each of our chosen markets.
During the third quarter of 2021, we continued to execute on our strategy and completed two acquisitions. We believe these investments align with several elements of our growth strategy, including entering new markets or submarkets that exhibit strong demand and fully placed in-service One Five Nine East 53rd Street,limitations on supply, uncovering opportunities that utilize our leasing and redevelopment skills to increase value, broadening our portfolio to meet the current and anticipated future
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Table of Contents
demand of tenants in the life sciences sector and employing our Strategic Capital Program (“SCP”) (Refer to the heading “Liquidity and Capital Resources” within “Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations” for a description of the SCP.) to utilize private equity to increase our returns and enhance our investment capacity.These acquisitions included:
Safeco Plaza, an approximately 220,000 square feet765,000 net rentable square-foot Class A office and retail redevelopmentbuilding in Seattle, Washington.The property was approximately 91% leased at September 30, 2021.This acquisition marked our initial entry into the Seattle market, one of the most vibrant markets in the low-rise portionUnited States for companies in the technology, life sciences, manufacturing and financial services sectors.The acquisition was completed through a newly formed joint venture with two institutional partners that are part of 601 Lexington Avenueour SCP.
Shady Grove Bio+Tech Campus, consisting of seven buildings totaling approximately 435,000 square-feet in New York City. The property includes approximately 195,000 square feetthe Shady Grove area of office spaceRockville, Maryland, a region that is 100% leasedhome to a universitymore than 400 companies in the biotechnology and life sciences sector.We plan to convert the office buildings on the campus to lab space to meet current and growing demand in the region from biotechnology companies for a 30-year term.new, Class A lab space.
AsIn the third quarter of March 31, 2021, we continued the construction of the developments and redevelopment projects in our construction/redevelopment pipeline, consistedwhich consists of nine properties that, when completed, we expect will total approximately 4.3 million net rentable square feet. ThreeAs of these development/redevelopment projects are owned by joint ventures. OurSeptember 30, 2021, our share of the estimated total cost for these projects is approximately $2.7 billion, of which approximately $1.4$1.1 billion of equity remained to be invested as of March 31, 2021.invested. The office portion of the development pipeline is approximately 86% pre-leased and the total development pipeline, inclusive of both office and lab/life sciences developments, andbut excluding the View Boston Observatory at The Prudential Center, Observatory, is 71%72% pre-leased as of May 3,November 2, 2021. The office development projects in our current pipeline, which total approximately 3.3 million square feet, are approximately 87% pre-leased, as of November 2, 2021, to predominately credit-strong tenants with long-lease terms. In addition, during September and October of 2021, we completed and delivered approximately 1.5 million square feet of space to tenants from our development pipeline.
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TableIn early 2021 we added several new development and redevelopment projects to our development pipeline focused on the specific needs of Contentstenants in the life sciences sector. Our lab/life sciences developments in our pipeline total approximately 920,000 square feet and include properties in Waltham, Massachusetts and South San Francisco, California. Although Shady Grove Bio+Tech Campus is not currently included in our development pipeline, we anticipate converting the office buildings on the campus to lab space. Our lab/life sciences developments are located in some of the largest life sciences clusters in the United States, with strong demand from tenants because of the close proximity to universities, research institutions and related businesses and concentrations of labor with specialized skills and knowledge.
Supply-chain concerns impact our business both in time to completion and increased costs. Our construction schedule is one of the criteria we use when we evaluate bids for development projects and capital improvements. We have been successful in awarding bids and maintaining schedules through the pandemic. However, there are fewer choices for materials, and we are working closely with our consultants and contractors to ensure there are not items used in the development or redevelopment process that could impact schedules. We are intentionally minimizing the amount of materials we acquire from overseas, releasing material packages as early as possible and stock-piling materials off-site. In addition, when budgeting new development projects, we are including projected cost increases of approximately 5-6%. We currently expect to deliver all active developments and redevelopments on time and budget, but we cannot assure you that we will not experience greater cost increases or that the materials we need will continue to be available so that we are able to complete the project. A failure to deliver a project on time could expose us to additional costs under the signed pre-leases for those projects.
As we continue to focus on the development and acquisition of assetsnew investments to enhance our long-termdrive future growth, we also continually review our portfolio to identify properties as potential sales candidates thatbecause they may either no longer fit within our portfolio strategy or they could attract premium pricing in the current market environment. For example, in the first quarter ofOn October 25, 2021, we completed the sale of Annapolis Junction Buildings Six181,191 and Seven, two Class A office properties in Annapolis, Maryland totaling201 Spring Street, a three-building complex aggregating approximately 247,000333,000 net rentable square feet in Lexington, Massachusetts, for aan aggregate gross sales price of approximately $65.9$191.5 million. The Company had a 50% ownership interest in the joint venture that owned the properties.three buildings are 100% leased. We expect towill continue to sell select assets from time to time, subject to market conditions.evaluate the sale of similar properties.
AExcluding Seattle, which we entered on September 1, 2021, a brief overview of each of our markets follows.
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Boston
OurThe Boston central business district (“CBD”) in-service portfolio was approximately 95% leased asregion is home to the largest cluster of March 31, 2021. This includes approximately 212,700 square feet, or approximately 2.2% of our Boston CBD portfolio, of space that we terminated with tenants that defaultedlife sciences companies in 2020 due to non-payment of rent.the world, and these companies are growing and increasing demand and rents in the region. During the firstthird quarter of 2021, we executedsigned approximately 165,000769,000 square feet of leases and approximately 258,000782,000 square feet of leases commenced in the Boston region.commenced. Approximately 211,000148,000 square feet of the leases that commenced had been vacant for less than one year and represent an increase in net rental obligations of approximately 43%17% over the prior leases.
Our Boston central business district (“CBD”) in-service portfolio was approximately 94% leased as of September 30, 2021. During the third quarter of 2021, we executed an approximately 524,000 square foot, 10-year lease extension with Wellington Management at Atlantic Wharf, approximately four years prior to the lease expiration, supporting our belief in the commitment of employers to office space and the attractiveness of our asset.
In addition, we completed and delivered 440,000 square feet of space leased to an affiliate of Verizon Communications at our 100 Causeway Street development project in Boston, Massachusetts. 100 Causeway Street is an approximately 632,000 square foot office building in which we have a 50% ownership interest.
Our approximately 2.0 million square foot in-service office portfolio in Cambridge was approximately 99% leased as of March 31,September 30, 2021. During the firstthird quarter of 2021, we continued our development of 325 Main Street at Kendall Center in Cambridge, Massachusetts, which is 90% pre-leased to an office tenant for a term of 15 years and we expect to deliver the building into service in 2022. In the first quarter ofearly 2021, we received approximately one million square feet of new entitlements at Kendall Center in Cambridge, Massachusetts for potential future development.
Waltham and the area surrounding the Route 128-Mass Turnpike interchange continue to comprise a popular submarket of Boston for leading and emerging companies in the life sciences, biotechnology and technology sectors. InSince the firstthird quarter of 2021, we signed a 63,500 square foot, 16-year lease with a healthcare company at 195 West Street in Waltham, Massachusetts, bringing that property to 100% leased. We also continued the redevelopment of 200 West Street, anleases for approximately 273,00052,000 square feet Class A office property in Waltham, Massachusetts. The redevelopment is a conversion of approximately 138,000 square feet into life sciences space that is 100% pre-leased to a biotechnology tenant with occupancy expected by year-end 2021. To enable us to meet current and future demand from tenants in the life sciences sector in this region, in the first quarter of 2021, we commenced the redevelopment ofat 880 Winter Street, an approximately 224,000 square foot office property in Waltham, Massachusetts that will beis being converted into lab space. We expect to deliver this project in early 2023. We also continued the conversion of 200 West Street in Waltham, Massachusetts into life sciences/lab space and we commencedcontinued the development of 180 CityPoint, an approximately 329,000 square foot lab development in Waltham, Massachusetts. These properties areMassachusetts, which is expected to be delivered in 20232024. We own or control a significant amount of land in the Boston region that we expect will enable us to aggressively compete for and 2024, respectively.meet the demand from the emerging and growing tenants in these industries.
Los Angeles
Our Los Angeles (“LA”) in-service portfolio of approximately 2.3 million square feet is currently focused onin West LA and includes Colorado Center, a 1.1 million square foot property of which we own 50%, and Santa Monica Business Park, a 21-building, approximately 1.2 million square foot property of which we own 55%. As of March 31,September 30, 2021, our LA in-service properties were approximately 82%83% leased. OurWe expect our occupancy declinedto increase later this year upon commencement of an approximately 140,000 square foot lease expansion that was signed in the firstsecond quarter of 2021 from 93.5%with a technology company at December 31, 2020, primarily due to the expiration of an approximately 200,000 square foot lease with an office tenant in the Santa Monica Business Park. InPark in Santa Monica, California.
New York
As of September 30, 2021, our New York CBD in-service portfolio was approximately 90% leased. During the firstthird quarter of 2021, (1) we signed a 72,000leases covering approximately 169,000 square feet, including an approximately 39,000 square foot 10-year leaseexpansion with a new tenant in the digital media sectorfinancial services company at Colorado Center in Los Angeles, California. With this lease, which we commenced revenue recognition in April 2021, our LA in-service properties are399 Park Avenue, increasing their total square footage to approximately 85% leased. During the first quarter of 2021, we had373,000 square feet, and (2) approximately 43,000259,000 square feet of leases commence in the LA region.commenced. Approximately 22,000200,000 square feet of the leases that commenced had been vacant for less than one year and represent an increasea decrease in net rental obligations of approximately 24%27% over the prior leases. Excluding approximately 55,000 square feet of short term leases that commenced, the net rental obligations decreased approximately 13% over the prior leases.
In the third quarter of 2021, sublease space continued to be removed from the market and high-quality buildings experienced increased leasing activity. We continue to explore opportunities to increase our presence by seeking investments where our financial, operational, redevelopment and development expertise provide the opportunity, either alone or with partners, to achieve accretive returns.
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New York
As of March 31, 2021, our New York CBD in-service portfolio wasare actively negotiating approximately 89% leased. In addition, we executed approximately 50,000340,000 square feet of leases, andof which approximately 390,000200,000 square feet of leases commenced in the first quarter of 2021. Of these leases, approximately 34,000 square feet had been vacant for less than one year and the net rental obligations rate was relatively flat as compared to prior leases.
In the first quarter of 2021, tour and leasing activity remained slow due to the ongoing pandemic but leasing activity has increased and we conducted more physical tours in New York City than we had in the comparable quarter in either 2019 or 2020. We are actively negotiating 14 leases totaling approximately 170,000 square feet, including a full floor leaseis at Dock 72, our joint venture property in Brooklyn, New York. During the first quarter ofIn October 2021, we signed new leases with several small tenants across the New York portfolio as well as a 25,00042,000 square foot 14-year expansion with a multinational asset management companylease at 399 Park Avenue in New York City, bringing the total space leased by the tenant to approximately 100,000 square feet.Dock 72.
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San Francisco
In the first quarter of 2021, governmental authoritiesThe recovery in San Francisco began lifting travel quarantines, stay-at-home orderscontinues to lag our other markets as fewer businesses have commenced their return to work, street-level retail remains closed or slow and the streets are quiet. As restrictions on the types of businesses that could continue to operate, including offices. As these restrictions wereare lifted, we believe the pace of new leasing activity beganwill begin to increase, although activity remains well below pre- pandemic levels.increase.
Our San Francisco CBD in-service properties were approximately 93%92% leased as of March 31,September 30, 2021. During the firstthird quarter of 2021, we executed approximately 167,000185,000 square feet of leases, andincluding over 100,000 square feet at Embarcadero Center. We executed four full floor leases at Embarcadero Center at average rental rates of over $100 per square foot. In addition, we commenced approximately 40,00091,000 square feet of leases in the San Francisco region. Of these leases, approximately 29,00057,000 square feet had been vacant for less than one year and represent an increase in net rental obligations of approximately 18%9% over the prior leases.
Also duringLife sciences activity at our Gateway Commons joint venture in which we own an approximately 52% interest continues to be productive. The joint venture has signed a letter of intent to lease the firstentirety of 751 Gateway Commons, a 229,000 square foot project in our development pipeline.
During the third quarter of 2021, we commenced developmentcompleted two full-building leases aggregating approximately 58,000 square feet in the Mountain View submarket. We are experiencing greater tour activity, including large technology tenant requirements for existing and new products. Due to the limited supply of 751 Gateway, an approximately 229,000 square foot lab developmentnew, high-quality office space in South San Francisco, California. 751 Gateway isthis submarket, we are evaluating when to restart the first phase of a multi-phase life sciences campus development. We will own 49% of 751 Gateway andour Platform 16 development project, an approximately 1.1 million aggregate square foot future development projects at Gateway Commons upon completion.next to Diridon Station in San Jose.
Washington,, DC
During the firstthird quarter of 2021, we executed approximately 126,000300,000 square feet of leases and we commenced approximately 566,000163,000 square feet of leases in the Washington, DC region. Of these leases, approximately 440,00096,000 square feet had been vacant for less than one year and represent an increasea decrease in net rental obligations of approximately 4%22% over the prior leases.
Our Washington, DC CBD in-service properties were approximately 83%84% leased, as of March 31,September 30, 2021, with modest near-term rollover exposure, and we have reduced our exposure in the Washington, DC CBD market significantly over the past few years through the dispositions of assets.
Our Washington, DC suburban properties include our significant presence in Reston, Virginia, where demand from technology and cybersecurity tenants remains strong. Our Washington, DC suburban properties were approximately 87%86% leased as of March 31,September 30, 2021. During the third quarter of 2021, we completed approximately 70,000 square feet of office leases in Reston and are in negotiations for another 125,000 square feet.
In October, we completed and delivered approximately 285,000 square feet at Reston Next, a Class A office project with approximately 1.1 million net rentable square feet located in Reston, Virginia. This project is 85% pre-leased as of November 2, 2021. In addition, on October 29, 2021, a joint venture in which we own a 50% interest, fully placed in-service 7750 Wisconsin Avenue, a Class A office project with approximately 734,000 net rentable square feet located in Bethesda, Maryland.



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Leasing Statistics
The table below details the leasing activity, including 100% of the unconsolidated joint ventures, that commenced during the three and nine months ended March 31,September 30, 2021:
Three months ended March 31, 2021
Total Square Feet
Vacant space available at the beginning of the period4,517,385 
Property dispositions/properties taken out of service (1)(104,613)
Properties placed (and partially placed) in-service (2)227,276 
Leases expiring or terminated during the period1,788,666 
Total space available for lease6,428,714 
1st generation leases
201,402 
2nd generation leases with new tenants
602,497 
2nd generation lease renewals
493,016 
Total space leased (3)1,296,915 
Vacant space available for lease at the end of the period5,131,799 
Leases executed during the period, in square feet (4)591,815 
Second generation leasing information: (5)
Leases commencing during the period, in square feet1,095,513 
Weighted Average Lease Term84 Months
Weighted Average Free Rent Period137 Days
Total Transaction Costs Per Square Foot (6)$82.44 
Increase in Gross Rents (7)9.47 %
Increase in Net Rents (8)14.67 %
Three months ended September 30, 2021Nine months ended September 30, 2021
(Square Feet)
Vacant space available at the beginning of the period5,186,818 4,517,385 
Property dispositions/properties taken out of service (1)— (104,613)
Vacant space in properties acquired (2)143,848 143,848 
Properties placed (and partially placed) in-service (3)503,024 732,454 
Leases expiring or terminated during the period862,505 4,061,176 
Total space available for lease6,696,195 9,350,250 
1st generation leases
585,933 789,489 
2nd generation leases with new tenants
407,240 1,824,259 
2nd generation lease renewals
311,332 1,344,812 
Total space leased (4)1,304,505 3,958,560 
Vacant space available for lease at the end of the period5,391,690 5,391,690 
Leases executed during the period, in square feet (5)1,431,817 3,262,850 
Second generation leasing information: (6)
Leases commencing during the period, in square feet718,572 3,169,071 
Weighted Average Lease Term58 Months81 Months
Weighted Average Free Rent Period124 Days158 Days
Total Transaction Costs Per Square Foot (7)$43.95 $70.21 
Increase (Decrease) in Gross Rents (8)(9.42)%(0.03)%
Increase (Decrease) in Net Rents (9)(14.23)%(0.11)%
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(1)Total square feet of property dispositions during the threenine months ended March 31,September 30, 2021 consists of 29,595 square feet due to the sale of Annapolis Junction Building Six. Total square feet of properties taken out of service during the threenine months ended March 31,September 30, 2021 consists of 34,290 square feet at 880 Winter Street and 40,728 square feet at 800 Boylston Street - The Prudential Center, both due to redevelopment.
(2)Total square feet of vacant space in properties acquired during the three and nine months ended September 30, 2021 consists of 69,581 square feet at Safeco Plaza and 74,267 square feet at Shady Grove Bio+Tech Campus.
(3)Total square feet of properties placed (and partially placed) in-service during the three months ended March 31,September 30, 2021 consists of 6,709 square feet at 685 Gateway and 496,315 square feet at 100 Causeway Street. Total square feet of properties placed (and partially placed) in-service during the nine months ended September 30, 2021 consists of 195,326 square feet of office and 31,950 square feet of retail at One Five Nine East 53rd Street, located in New York City.6,709 square feet at 685 Gateway and 498,469 square feet at 100 Causeway Street.
(3)(4)Represents leases for which lease revenue recognition has commenced in accordance with GAAP during the three and nine months ended March 31, 2021.September 30, 2021.
(4)(5)Represents leases executed during the three and nine months ended March 31,September 30, 2021 for which we either (1) commenced lease revenue recognition in such period or (2) will commence lease revenue recognition in subsequent periods, in accordance with GAAP, and includes leases at properties currently under development. The total square feet of leases executedexecuted and recognized in the three and nine months ended March 31,September 30, 2021 is 86,652. Amounts for the three months ended March 31, 2021 exclude lease modifications related to COVID-19 covering an aggregate of 208,000 square feet that were executed in the three months ended March 31, 2021, to provide cash rent deferrals and/or abatements. Of these lease modifications, the lease terms associated with 67,387 square feet were extended for a period of 12 or more months during the three months ended March 31, 2021.320,719 and 734,797, respectively.
(5)(6)Second generation leases are defined as leases for space that had previously been leased by us. Of the 1,095,513718,572 and 3,169,071 square feet of second generation leases that commenced during the three and nine months months ended March 31,September 30, 2021, respectively, leases for 1,011,835397,853 and 2,439,402 square feet, respectively, were signed in prior periods.
(6)(7)Total transaction costs include tenant improvements and leasing commissions but exclude free rent concessions and other inducements in accordance with GAAP.
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(8)Represents the increasedecrease in gross rent (base rent plus expense reimbursements) on the new versus expired leases on the 735,432507,899 and 2,219,080 square feet of second generation leases that had been occupied within the prior 12 months for the three and nine months ended March 31, 2021;September 30, 2021, respectively; excludes leases that management considers temporary because the tenant is not expected to occupy the space on a long-term basis.
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(8)(9)Represents the increasedecrease in net rent (gross rent less operating expenses) on the new versus expired leases on the 735,432507,899 and 2,219,080 square feet of second generation leases that had been occupied within the prior 12 months for the three and nine months ended March 31, 2021; excludes leases that management considers temporary because the tenant is not expected to occupy the space on a long-term basis.September 30, 2021, respectively.
Transactions during the three months ended March 31,September 30, 2021 included the following:
Developments/redevelopmentsAcquisition/disposition activities
On February 1,August 2, 2021, we completedacquired Shady Grove Bio+Tech Campus in Rockville, Maryland, for a purchase price, including transaction costs, of approximately $118.5 million in cash. Shady Grove Bio+Tech Campus is an approximately 435,000 net rentable square foot, seven-building office park situated on an approximately 31-acre site. We intend to reposition three of the buildings, which are currently vacant, to support lab or life sciences uses. As a result, the three vacant buildings are not part of our in-service portfolio. We anticipate that we will redevelop or convert the remaining four buildings to lab or life sciences-related uses as each becomes vacant.
On July 13, 2021, we entered into an agreement to sell our 181,191 and fully placed in-service One Five Nine East 53rd201 Spring Street aproperties located in Lexington, Massachusetts for an aggregate gross sales price of $191.5 million. 181,191 and 201 Spring Street are three Class A office and retail redevelopment of the low-rise portion of our 601 Lexington Avenue property withproperties aggregating approximately 220,000333,000 net rentable square feet located in New York City.
On Februaryand are 100% leased. The sale was completed on October 25, 2021 we commenced the development of 180 CityPoint, located in Waltham, Massachusetts. When completed, the building will consist of approximately 329,000 net rentable square feet of laboratory space.
On February 25, 2021, we commenced the redevelopment of 880 Winter Street, located in Waltham, Massachusetts. When completed, the building will consist of approximately 224,000 net rentable square feet of laboratory space.
On February 25, 2021, we commenced the redevelopment of The Prudential Center Observatory, a 59,000 net rentable square foot redevelopment of the top three floors of 800 Boylston Street - The Prudential Center, located in Boston, Massachusetts.(See below).
Unconsolidated joint venture activities
On February 25, August 31, 2021, a joint venture in which we have a 54%50% interest commencedextended the developmentconstruction loan collateralized by its The Hub on Causeway – Podium property. At the time of 751 Gateway,the extension, the outstanding balance of the loan totaled approximately $174.3 million, bore interest at a speculative laboratory building located in South San Francisco, California, thatvariable rate equal to LIBOR plus 2.25% per annum and was scheduled to mature on September 6, 2021, with two, one-year extension options, subject to certain conditions. The extended loan continues to bear interest at a variable rate equal to LIBOR plus 2.25% per annum and matures on September 6, 2023. The Hub on Causeway - Podium is expected to bea retail and office property with approximately 229,000382,000 net rentable square feet upon completion. 751 Gatewaylocated in Boston, Massachusetts.
On September 1, 2021, we entered into a joint venture to acquire Safeco Plaza, a Class A office property located in Seattle, Washington, for a gross purchase price of approximately $465.0 million. Safeco Plaza is the first phase of a multi-phase development plan at Gateway Commons. Upon the formation50-story, approximately 765,000 net rentable square-foot, Class A office property. The acquisition was completed through a newly formed joint venture with two institutional partners. Each of the joint venture in 2020, we had aninstitutional partners invested approximately 55%$71.9 million of cash for its 33.165% ownership interest in the joint venture as a result of the partner’s deferred contribution and the partner is obligated to fund all required capital until such time as we own a 50% interest. On March 31, 2021, we had a 54% interest in the joint venture. We will own a 49%invested approximately $72.6 million for our 33.67% interest in any development project, including 751 Gateway.the joint venture and are providing customary operating, property management and leasing services to the joint venture. Our ownership includes (1) a 33.0% direct interest in the joint venture, and (2) an additional 1% interest in each of the two entities (each, a “Safeco Partner Entity”) through which each partner owns its interest in the joint venture. Subject to the occurrence of certain events and the joint venture achieving certain return thresholds, we are entitled to earn promote distributions. Some of the promote distributions may be payable in cash or, at our election, equity interest(s) in the Safeco Partner Entity(ies). The purchase price was funded with cash and proceeds from a new mortgage loan secured by the property. The mortgage loan has a principal amount of $250.0 million, bears interest at a variable rate equal to the greater of (x) 2.35% or (y) LIBOR plus 2.20% per annum and matures on September 1, 2026.
Debt Transaction
On March 30, 2021, we completed the sale of our 50% ownership interest in Annapolis Junction NFM LLC (the “Annapolis Junction Joint Venture”) to our joint venture partner for a gross sales price of $65.9 million. Net cash proceeds totaled approximately $17.6 million after repayment of our share of debt totaling approximately $15.1 million and the deferment of a $0.2 million payment due from the purchaser. We recognized a gain on sale of investment totaling approximately $10.3 million, which is included in Income (Loss) from Unconsolidated Joint Ventures in the accompanying Consolidated Statements of Operations. In addition to net cash proceeds from the sale, we will be distributed approximately $5.8 million of available cash subsequent to March 31, 2021. Annapolis Junction Buildings Six and Seven are Class A office properties totaling approximately 247,000 net rentable square feet. With the sale of our ownership interest in the Annapolis Junction Joint Venture, we no longer have any assets in Annapolis, Maryland.
Capital markets activities
On February 14, 2021, BPLP completed the redemption of $850.0 million in aggregate principal amount of its 4.125% senior notes due May 15, 2021. The redemption price was approximately $858.7 million, which was equal to par plus approximately $8.7 million of accrued and unpaid interest to, but not including, the redemption date. Excluding the accrued and unpaid interest, the redemption price was equal to the principal amount being redeemed. We recognized a loss from early extinguishment of debt totaling approximately $0.4 million related to unamortized origination costs.
On March 16,September 29, 2021, BPLP completed a public offering of $850.0 million in aggregate principal amount of its 2.550%2.450% unsecured senior notes due 2032.2033. The notes were priced at 99.570%99.959% of the principal amount to yield an effective rate (including financing fees) of approximately 2.671%2.524% per annum to maturity. The notes will mature on AprilOctober 1, 2032,2033, unless earlier redeemed. The aggregate net proceeds
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proceeds from the offering were approximately $839.2$842.5 million after deducting underwriting discounts and transaction expenses.
On March 16,Transactions completed subsequent to September 30, 2021 BPLP repaid all amounts borrowed underincluded the delayed draw term loan facility (“Delayed Draw Facility”) ($500.0 million). We recognized a loss from early extinguishment of debt totaling approximately $0.5 million, related to unamortized financing costs.following:
On March 26,October 15, 2021, weBPLP used available cash and funds under its unsecured revolving credit agreement (the “2021 Credit Facility”) to repaycomplete the mortgage loan collateralized by our University Place property locatedredemption of $1.0 billion in Cambridge, Massachusetts totaling approximately $0.9 million. The mortgage loan bore interest at a fixed rate of 6.94% per annum and was scheduled to mature on August 1, 2021. There was no prepayment penalty.
Equity Transaction
On March 2, 2021, BXP issued a redemption notice for 80,000 sharesaggregate principal amount of its Series B Preferred Stock, which constituted all of the outstanding Series B Preferred Stock, and the corresponding depositary shares, each representing 1/100th of a share of Series B Preferred Stock (the “Depositary Shares”), and recorded it as a liability.3.85% senior notes due February 1, 2023. The redemption price per sharewas approximately $1.05 billion, which included approximately $7.9 million of Series B Preferred Stock was equal to $2,500 plus all accrued and unpaid dividendsinterest to, but not including, the redemption date and an early redemption premium and unamortized financing costs totaling $2,516.41 per share. On March 31, 2021, BXP transferred the full redemption price for all outstanding shares of Series B Preferred Stock of approximately $201.3 million including approximately $1.3 million of accrued and unpaid dividends to, but not including, the redemption date, to the redemption agent and recorded that amount within Cash held in escrows on the Consolidated Balance Sheets. Upon redemption of the Series B Preferred Stock, all outstanding shares of the Series B Preferred Units, which had terms and preferences generally mirroring those of the Series B Preferred Stock, were redeemed by BPLP. The excess of the redemption price over the carrying value of the Series B Preferred Stock and Series B Preferred Units of approximately $6.4 million relates to the original issuance costs and will be reflected as a reduction to Net Income Attributable to Boston Properties, Inc. common shareholders and Net Income Attributable to Boston Properties Limited Partnership common unitholders on the Consolidated Income Statement.
Transactions completed subsequent to March 31, 2021 included the following:
On April 1, 2021, BXP redeemed 80,000 shares of Series B Preferred Stock (including the corresponding 8,000,000 Depositary Shares), which represented all of the outstanding shares of Series B Preferred Stock. Upon redemption of the Series B Preferred Stock, all outstanding shares of the Series B Preferred Units, which had terms and preferences generally mirroring those of the Series B Preferred Stock, were redeemed by BPLP. We paid an aggregate $201.3 million including $1.3 million of accrued but unpaid interest.$43.9 million.
On May 3,October 19, 2021, we entered into an agreement to acquire two life sciences lab buildings located in Waltham, Massachusetts forpartially placed in-service Reston Next, a purchase price of Class A office project with approximately $100.0 million. These two life sciences lab buildings aggregate approximately 137,000 1.1 million net rentable square feet. Thefeet located in Reston, Virginia.
On October 25, 2021, we completed the sale of our 181,191 and 201 Spring Street properties are 100% leased. We expect to close on the acquisition during the second quarterlocated in Lexington, Massachusetts for an aggregate gross sales price of 2021. The transaction is subject to the satisfaction of customary closing conditions. There can be no assurance that the acquisition will be consummated on the terms currently contemplated or at all.$191.5 million, as described above under “- Acquisition/disposition activities”.
On October 29, 2021, a joint venture in which we have a 50% interest fully placed in-service 7750 Wisconsin Avenue, a Class A office project with approximately 734,000 net rentable square feet located in Bethesda, Maryland.
Critical Accounting Policies
Management’s Discussion and Analysis of Financial Condition and Results of Operations discuss our Consolidated Financial Statements, which have been prepared in accordance with generally accepted accounting principles (“GAAP”). The preparation of these financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Certain accounting policies are considered to be critical accounting policies, as they require management to make assumptions about matters that are highly uncertain at the time the estimate is made and changes in accounting estimate are reasonably likely to occur from period to period. Management bases its estimates and assumptions on historical experience and current economic conditions. On an on-going basis, management evaluates its estimates and assumptions including those related to revenue, impairment of long-lived assets and the allowance for doubtful accounts. Actual results may differ from those estimates and assumptions.
47

Our Annual Report on Form 10-K for the year ended December 31, 2020 contains a discussion of our critical accounting policies. Management discusses and reviews our critical accounting policies and management’s judgments and estimates with BXP’s Audit Committee.
Results of Operations for the ThreeNine Months Ended March 31,September 30, 2021 and 2020
Net income attributable to Boston Properties, Inc. common shareholders and net income attributable to Boston Properties Limited Partnership common unitholders decreased approximately $405.9$542.9 million and $460.6$616.3 million for the threenine months ended March 31,September 30, 2021 compared to 2020, respectively, as set forth in the following tables and for the reasons discussed below under the heading “Comparison of the threenine months ended March 31,September 30, 2021 to the threenine months ended March 31,September 30, 2020” within “Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations.”
The following are reconciliations of Net Income Attributable to Boston Properties, Inc. Common Shareholders to Net Operating Income and Net Income Attributable to Boston Properties Limited Partnership Common Unitholders to Net Operating Income for the threenine months ended March 31,September 30, 2021 and 2020 (in thousands):
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Boston Properties, Inc.
Three months ended March 31,Nine months ended September 30,
20212020Increase/
(Decrease)
%
Change
20212020Increase/
(Decrease)
%
Change
Net Income Attributable to Boston Properties, Inc. Common ShareholdersNet Income Attributable to Boston Properties, Inc. Common Shareholders$91,624 $497,496 $(405,872)(81.58)%Net Income Attributable to Boston Properties, Inc. Common Shareholders$311,680 $854,541 $(542,861)(63.53)%
Preferred stock redemption chargePreferred stock redemption charge6,412 — 6,412 100.00 %Preferred stock redemption charge6,412 — 6,412 100.00 %
Preferred dividendsPreferred dividends2,560 2,625 (65)(2.48)%Preferred dividends2,560 7,875 (5,315)(67.49)%
Net Income Attributable to Boston Properties, Inc.Net Income Attributable to Boston Properties, Inc.100,596 500,121 (399,525)(79.89)%Net Income Attributable to Boston Properties, Inc.320,652 862,416 (541,764)(62.82)%
Net Income Attributable to Noncontrolling Interests:Net Income Attributable to Noncontrolling Interests:Net Income Attributable to Noncontrolling Interests:
Noncontrolling interest—common units of the Operating PartnershipNoncontrolling interest—common units of the Operating Partnership11,084 57,539 (46,455)(80.74)%Noncontrolling interest—common units of the Operating Partnership35,393 97,090 (61,697)(63.55)%
Noncontrolling interests in property partnershipsNoncontrolling interests in property partnerships16,467 19,486 (3,019)(15.49)%Noncontrolling interests in property partnerships52,602 34,280 18,322 53.45 %
Net IncomeNet Income128,147 577,146 (448,999)(77.80)%Net Income408,647 993,786 (585,139)(58.88)%
Other Expenses:Other Expenses:Other Expenses:
Add:Add:Add:
Interest expenseInterest expense107,902 101,591 6,311 6.21 %Interest expense320,015 319,726 289 0.09 %
Losses from early extinguishment of debtLosses from early extinguishment of debt898 — 898 100.00 %Losses from early extinguishment of debt898 — 898 100.00 %
Loss from unconsolidated joint venturesLoss from unconsolidated joint ventures1,745 5,410 (3,665)(67.74)%
Other Income:Other Income:Other Income:
Less:Less:Less:
Gains (losses) from investments in securities1,659 (5,445)7,104 130.47 %
Gains from investments in securitiesGains from investments in securities3,744 965 2,779 287.98 %
Interest and other income (loss)Interest and other income (loss)1,168 3,017 (1,849)(61.29)%Interest and other income (loss)4,140 4,277 (137)(3.20)%
Gains on sales of real estateGains on sales of real estate— 410,165 (410,165)(100.00)%Gains on sales of real estate8,104 613,723 (605,619)(98.68)%
Income (loss) from unconsolidated joint ventures5,225 (369)5,594 1,515.99 %
Other Expenses:Other Expenses:Other Expenses:
Add:Add:Add:
Depreciation and amortization expenseDepreciation and amortization expense176,565 171,094 5,471 3.20 %Depreciation and amortization expense539,815 515,738 24,077 4.67 %
Transaction costsTransaction costs331 615 (284)(46.18)%Transaction costs2,970 1,254 1,716 136.84 %
Payroll and related costs from management services contractsPayroll and related costs from management services contracts3,505 3,237 268 8.28 %Payroll and related costs from management services contracts9,166 8,617 549 6.37 %
General and administrative expenseGeneral and administrative expense44,959 36,454 8,505 23.33 %General and administrative expense117,924 102,059 15,865 15.54 %
Other Revenue:Other Revenue:Other Revenue:
Less:Less:Less:
Direct reimbursements of payroll and related costs from management services contractsDirect reimbursements of payroll and related costs from management services contracts3,505 3,237 268 8.28 %Direct reimbursements of payroll and related costs from management services contracts9,166 8,617 549 6.37 %
Development and management services revenueDevelopment and management services revenue6,803 7,879 (1,076)(13.66)%Development and management services revenue20,181 23,285 (3,104)(13.33)%
Net Operating IncomeNet Operating Income$443,947 $471,653 $(27,706)(5.87)%Net Operating Income$1,355,845 $1,295,723 $60,122 4.64 %
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Boston Properties Limited Partnership
Three months ended March 31,Nine months ended September 30,
20212020Increase/
(Decrease)
%
Change
20212020Increase/
(Decrease)
%
Change
Net Income Attributable to Boston Properties Limited Partnership Common UnitholdersNet Income Attributable to Boston Properties Limited Partnership Common Unitholders$105,773 $566,333 $(460,560)(81.32)%Net Income Attributable to Boston Properties Limited Partnership Common Unitholders$353,633 $969,932 $(616,299)(63.54)%
Preferred unit redemption chargePreferred unit redemption charge6,412 — 6,412 100.00 %Preferred unit redemption charge6,412 — 6,412 100.00 %
Preferred distributionsPreferred distributions2,560 2,625 (65)(2.48)%Preferred distributions2,560 7,875 (5,315)(67.49)%
Net Income Attributable to Boston Properties Limited PartnershipNet Income Attributable to Boston Properties Limited Partnership114,745 568,958 (454,213)(79.83)%Net Income Attributable to Boston Properties Limited Partnership362,605 977,807 (615,202)(62.92)%
Net Income Attributable to Noncontrolling Interests:Net Income Attributable to Noncontrolling Interests:Net Income Attributable to Noncontrolling Interests:
Noncontrolling interests in property partnershipsNoncontrolling interests in property partnerships16,467 19,486 (3,019)(15.49)%Noncontrolling interests in property partnerships52,602 34,280 18,322 53.45 %
Net IncomeNet Income131,212 588,444 (457,232)(77.70)%Net Income415,207 1,012,087 (596,880)(58.98)%
Other Expenses:Other Expenses:Other Expenses:
Add:Add:Add:
Interest expenseInterest expense107,902 101,591 6,311 6.21 %Interest expense320,015 319,726 289 0.09 %
Losses from early extinguishment of debtLosses from early extinguishment of debt898 — 898 100.00 %Losses from early extinguishment of debt898 — 898 100.00 %
Loss from unconsolidated joint venturesLoss from unconsolidated joint ventures1,745 5,410 (3,665)(67.74)%
Other Income:Other Income:Other Income:
Less:Less:Less:
Gains (losses) from investments in securities1,659 (5,445)7,104 130.47 %
Gains from investments in securitiesGains from investments in securities3,744 965 2,779 287.98 %
Interest and other income (loss)Interest and other income (loss)1,168 3,017 (1,849)(61.29)%Interest and other income (loss)4,140 4,277 (137)(3.20)%
Gains on sales of real estateGains on sales of real estate— 419,654 (419,654)(100.00)%Gains on sales of real estate8,104 626,686 (618,582)(98.71)%
Income (loss) from unconsolidated joint ventures5,225 (369)5,594 1,515.99 %
Other Expenses:Other Expenses:Other Expenses:
Add:Add:Add:
Depreciation and amortization expenseDepreciation and amortization expense173,500 169,285 4,215 2.49 %Depreciation and amortization expense533,255 510,400 22,855 4.48 %
Transaction costsTransaction costs331 615 (284)(46.18)%Transaction costs2,970 1,254 1,716 136.84 %
Payroll and related costs from management services contractsPayroll and related costs from management services contracts3,505 3,237 268 8.28 %Payroll and related costs from management services contracts9,166 8,617 549 6.37 %
General and administrative expenseGeneral and administrative expense44,959 36,454 8,505 23.33 %General and administrative expense117,924 102,059 15,865 15.54 %
Other Revenue:Other Revenue:Other Revenue:
Less:Less:Less:
Direct reimbursements of payroll and related costs from management services contractsDirect reimbursements of payroll and related costs from management services contracts3,505 3,237 268 8.28 %Direct reimbursements of payroll and related costs from management services contracts9,166 8,617 549 6.37 %
Development and management services revenueDevelopment and management services revenue6,803 7,879 (1,076)(13.66)%Development and management services revenue20,181 23,285 (3,104)(13.33)%
Net Operating IncomeNet Operating Income$443,947 $471,653 $(27,706)(5.87)%Net Operating Income$1,355,845 $1,295,723 $60,122 4.64 %
At each of March 31,September 30, 2021 and 2020, we owned or had joint venture interests in a portfolio of 202 and 196 commercial real estate properties, respectively (in each case, the “Total Property Portfolio”). As a result of changes within our Total Property Portfolio, the financial data presented below shows significant changes in revenue and expenses from period-to-period. Accordingly, we do not believe that our period-to-period financial data with respect to the Total Property Portfolio is meaningful.provides a complete understanding of our operating results. Therefore, the comparison of operating results for the three and nine months ended March 31,September 30, 2021 and 2020 show separately the changes attributable to the properties that were owned by us and in-service throughout each period compared (the “Same Property Portfolio”) and the changes attributable to the properties included in the Acquired, Placed In-Service, Development or Redevelopment or Sold Portfolios.
In our analysis of operating results, particularly to make comparisons of net operating income between periods more meaningful, it is important to provide information for properties that were in-service and owned by us throughout each period presented. We refer to properties acquired or placed in-service prior to the beginning of the earliest period presented and owned by us and in-service through the end of the latest period presented as our Same Property Portfolio. The Same Property Portfolio therefore excludes properties acquired, placed in-service or in development or redevelopment after the beginning of the earliest period presented or disposed of prior to the end of the latest period presented.
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Net operating income (“NOI”) is a non-GAAP financial measure equal to net income attributable to Boston Properties, Inc. common shareholders and net income attributable to Boston Properties Limited Partnership common unitholders, as applicable, the most directly comparable GAAP financial measures, plus (1) preferred stock/unit redemption charge, preferred dividends/distributions, net income attributable to noncontrolling interests, interest expense, losses from early extinguishment of debt, loss from unconsolidated joint ventures, depreciation and amortization expense, transaction costs, payroll and related costs from management services contracts and corporate general and administrative expense less (2) gains (losses) from investments in securities, interest and other income (loss), gains (losses) on sales of real estate, income (loss) from unconsolidated joint ventures, direct reimbursements of payroll and related costs from management services contracts and development and management services revenue. We use NOI internally as a performance measure and believe it provides useful information to investors regarding our results of operations and financial condition because, when compared across periods, it reflects the impact on operations from trends in occupancy rates, rental rates, operating costs and acquisition and development activity on an unleveraged basis, providing perspective not immediately apparent from net income attributable to Boston Properties, Inc. common shareholders and net income attributable to Boston Properties Limited Partnership common unitholders. For example, interest expense is not necessarily linked to the operating performance of a real estate asset and is often incurred at the corporate level as opposed to the property level. Similarly, interest expense may be incurred at the property level even though the financing proceeds may be used at the corporate level (e.g., used for other investment activity). In addition, depreciation and amortization expense, because of historical cost accounting and useful life estimates, may distort operating performance measures at the property level. NOI presented by us may not be comparable to NOI reported by other REITs or real estate companies that define NOI differently.
We believe that, in order to facilitate a clear understanding of our operating results, NOI should be examined in conjunction with net income attributable to Boston Properties, Inc. common shareholders and net income attributable to Boston Properties Limited Partnership common unitholders as presented in our Consolidated Financial Statements. NOI should not be considered as a substitute for net income attributable to Boston Properties, Inc. common shareholders or net income attributable to Boston Properties Limited Partnership common unitholders (determined in accordance with GAAP) or any other GAAP financial measures and should only be considered together with and as a supplement to our financial information prepared in accordance with GAAP.
The gains on sales of real estate, depreciation expense and impairment losses may differ between BXP and BPLP as a result of previously applied acquisition accounting by BXP for the issuance of common stock in connection with non-sponsor OP Unit redemptions by BPLP. This accounting resulted in a step-up of the real estate assets at BXP that was allocated to certain properties. The difference between the real estate assets of BXP as compared to BPLP for certain properties having an allocation of the real estate step-up will result in a corresponding difference in gains on sales of real estate, depreciation expense and impairment losses, when those properties are sold. For additional information see the Explanatory Note that follows the cover page of this Quarterly Report on Form 10-Q.
Comparison of the threenine months ended March 31,September 30, 2021 to the threenine months ended March 31,September 30, 2020
The table below shows selected operating information for the Same Property Portfolio and the Total Property Portfolio. The Same Property Portfolio consists of 141140 properties totaling approximately 39.239.0 million net rentable square feet, excluding unconsolidated joint ventures. The Same Property Portfolio includes properties acquired or placed in-service on or prior to January 1, 2020 and owned and in service through March 31,September 30, 2021. The Total Property Portfolio includes the effects of the other properties either acquired, placed in-service, in development or redevelopment after January 1, 2020 or disposed of on or prior to March 31,September 30, 2021. This table includes a reconciliation from the Same Property Portfolio to the Total Property Portfolio by also providing information for the threenine months ended March 31,September 30, 2021 and 2020 with respect to the properties that were acquired, placed in-service, in development or redevelopment or sold.

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Same Property PortfolioProperties Acquired PortfolioProperties
Placed In-Service
Portfolio
Properties in Development or Redevelopment PortfolioProperties Sold PortfolioTotal Property Portfolio Same Property PortfolioProperties Acquired PortfolioProperties
Placed In-Service
Portfolio
Properties in Development or Redevelopment PortfolioProperties Sold PortfolioTotal Property Portfolio
20212020Increase/
(Decrease)
%
Change
2021202020212020202120202021202020212020Increase/
(Decrease)
%
Change
20212020Increase/
(Decrease)
%
Change
2021202020212020202120202021202020212020Increase/
(Decrease)
%
Change
(dollars in thousands)(dollars in thousands)
Rental Revenue: (1)Rental Revenue: (1)Rental Revenue: (1)
Lease Revenue (Excluding Termination Income)Lease Revenue (Excluding Termination Income)$657,779 $677,430 $(19,651)(2.90)%$310 $— $9,415 $3,327 $2,836 $3,548 $2,203 $13,614 $672,543 $697,919 $(25,376)(3.64)%Lease Revenue (Excluding Termination Income)$1,969,391 $1,917,628 $51,763 2.70 %$4,617 $297 $31,200 $13,115 $8,928 $14,771 $7,258 $24,067 $2,021,394 $1,969,878 $51,516 2.62 %
Termination IncomeTermination Income4,269 2,385 1,884 78.99 %— — — — — — — 14 4,269 2,399 1,870 77.95 %Termination Income11,499 8,363 3,136 37.50 %— — — — — — — 59 11,499 8,422 3,077 36.54 %
Lease RevenueLease Revenue662,048 679,815 (17,767)(2.61)%310 — 9,415 3,327 2,836 3,548 2,203 13,628 676,812 700,318 (23,506)(3.36)%Lease Revenue1,980,890 1,925,991 54,899 2.85 %4,617 297 31,200 13,115 8,928 14,771 7,258 24,126 2,032,893 1,978,300 54,593 2.76 %
Parking and OtherParking and Other16,478 23,636 (7,158)(30.28)%37 — — — 247 699 16,768 24,341 (7,573)(31.11)%Parking and Other56,398 53,136 3,262 6.14 %488 14 16 201 — 1,003 1,150 58,104 54,305 3,799 7.00 %
Total Rental Revenue (1)Total Rental Revenue (1)678,526 703,451 (24,925)(3.54)%347 — 9,421 3,333 2,836 3,548 2,450 14,327 693,580 724,659 (31,079)(4.29)%Total Rental Revenue (1)2,037,288 1,979,127 58,161 2.94 %5,105 300 31,214 13,131 9,129 14,771 8,261 25,276 2,090,997 2,032,605 58,392 2.87 %
Real Estate Operating ExpensesReal Estate Operating Expenses245,880 250,663 (4,783)(1.91)%451 — 2,948 1,384 1,145 1,797 838 5,058 251,262 258,902 (7,640)(2.95)%Real Estate Operating Expenses728,119 726,296 1,823 0.25 %2,294 443 8,586 5,778 4,414 6,224 2,860 9,289 746,273 748,030 (1,757)(0.23)%
Net Operating Income (Loss), Excluding Residential and HotelNet Operating Income (Loss), Excluding Residential and Hotel432,646 452,788 (20,142)(4.45)%(104)— 6,473 1,949 1,691 1,751 1,612 9,269 442,318 465,757 (23,439)(5.03)%Net Operating Income (Loss), Excluding Residential and Hotel1,309,169 1,252,831 56,338 4.50 %2,811 (143)22,628 7,353 4,715 8,547 5,401 15,987 1,344,724 1,284,575 60,149 4.68 %
Residential Net Operating Income (Loss) (2)Residential Net Operating Income (Loss) (2)4,413 5,892 (1,479)(25.10)%— — (1,365)— — — — — 3,048 5,892 (2,844)(48.27)%Residential Net Operating Income (Loss) (2)14,833 16,809 (1,976)(11.76)%— — (3,101)(717)— — — — 11,732 16,092 (4,360)(27.09)%
Hotel Net Operating Income (Loss) (2)(1,419)(1,423)(35,575.00)%— — — — — — — — (1,419)(1,423)(35,575.00)%
Hotel Net Operating Loss (2)Hotel Net Operating Loss (2)(611)(4,944)4,333 87.64 %— — — — — — — — (611)(4,944)4,333 87.64 %
Net Operating Income (Loss)Net Operating Income (Loss)$435,640 $458,684 $(23,044)(5.02)%$(104)$— $5,108 $1,949 $1,691 $1,751 $1,612 $9,269 $443,947 $471,653 $(27,706)(5.87)%Net Operating Income (Loss)$1,323,391 $1,264,696 $58,695 4.64 %$2,811 $(143)$19,527 $6,636 $4,715 $8,547 $5,401 $15,987 $1,355,845 $1,295,723 $60,122 4.64 %
_______________
(1)Rental Revenue is equal to Revenue less Development and Management Services Revenue and Direct Reimbursements of Payroll and Related Costs from Management Services Revenue per the Consolidated Statements of Operations, excluding the residential and hotel revenue that is noted below. We use Rental Revenue internally as a performance measure and in calculating other non-GAAP financial measures (e.g., NOI), which provides investors with information regarding our performance that is not immediately apparent from the comparable non-GAAP measures and allows investors to compare operating performance between periods.
(2)For a detailed discussion of NOI, including the reasons management believes NOI is useful to investors, see page 50.59. Residential Net Operating Income for the threenine months ended March 31,September 30, 2021 and 2020 is comprised of Residential Revenue of $9,175$29,832 and $9,956$29,076 less Residential Expenses of $6,127$18,100 and $4,064,$12,984, respectively. Hotel Net Operating IncomeLoss for the threenine months ended March 31,September 30, 2021 and 2020 is comprised of Hotel Revenue of $632$7,382 and $6,825$7,014 less Hotel Expenses of $2,051$7,993 and $6,821,$11,958, respectively, per the Consolidated Statements of Operations.
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Same Property Portfolio
Lease Revenue (Excluding Termination Income)
Lease revenue (excluding termination income) from the Same Property Portfolio decreasedincreased by approximately $19.7$51.8 million for the threenine months ended March 31,September 30, 2021 compared to 2020. The decreaseApproximately $59.6 million of the increase was a resultrelated to write-offs of ouraccrued rent and accounts receivable balances that occurred during the nine months ended September 30, 2020 and did not recur in 2021, for primarily retail tenants that either terminated their leases or we determined that the accrued rent and/or accounts receivable balances were no longer probable of collection. Excluding the write-offs, the Same Property Portfolio decreased by approximately $7.8 million due to average occupancy decreasing from 94.3%93.4% to 91.6%. Average91.7%, resulting in a decrease of approximately $62.9 million, partially offset by an increase in average revenue per square foot wasby approximately $1.08, contributing approximately $55.1 million.
We continue to evaluate the same for both periods.
As a resultcollectability of COVID-19, for the Same Property Portfolio, during the three months ended March 31, 2021, we executed lease modification agreements for approximately 127,000 square feetour accrued rent and granted approximately $5.3 million of cash rent abatements and deferrals, of which approximately $2.5 millionaccounts receivable balances related to tenant charges forlease revenue. If after a write-off has been recorded, (1) we subsequently determine that we are probable we will collect substantially all the three months ended March 31, 2021. In addition, during the three months ended March 31, 2021, we recognized approximately $5.9 million related to tenant charges forremaining lessee’s lease modifications signed during 2020. Although some of the lease modifications were deferralspayments under which we expect the tenant will pay us in full primarily in 2021, the majority of the lease modifications involved extending the lease term (in some cases for a year or more) or providing for a period of time where the tenant will only pay percentage rent. As a result ofand (2) the lease modification agreements that extendedhas not been modified since the write-off, we will then reinstate the accrued rent and accounts receivable write-offs, adjusting for the amount related to the period when the lease term, we expect to see an increase inpayments were considered not probable of collection. If our estimate of collectability differs from the cash rent we will receive inreceived, then the future.timing and amount of our reported revenue could be impacted.
Each quarter since the second quarter of 2020, the number of executed COVID-19 lease modifications has decreased. We expectdecreased and as of the volumethird quarter of lease2021, we are executing COVID-19 modifications to further decrease as the economy recovers. However, the degree to which our tenants’ businesses have been negatively impacted by COVID-19 and any resulting downturn in their business may leave some tenants still unable to meet their rental payment obligations and result inon a reduction in our cash flows.limited basis.
Termination Income
Termination income increased by approximately $1.9$3.1 million for the threenine months ended March 31,September 30, 2021 compared to 2020.
Termination income for the threenine months ended March 31,September 30, 2021 related to 1123 tenants across the Same Property Portfolio and totaled approximately $4.3 million, of which $3.7 million was related to a retail tenant in the Boston region that closed all its retail stores.
Termination income for the three months ended March 31, 2020 related to 14 tenants across the Same Property Portfolio and totaled approximately $2.4$11.5 million, which was primarily related to tenants that terminated leases early in New York City and the Boston region.
Termination income for the nine months ended September 30, 2020 related to 34 tenants across the Same Property Portfolio and totaled approximately $8.4 million, which was primarily related to tenants that terminated leases early in New York City.
Parking and Other Revenue
Parking and other revenue decreasedincreased by approximately $7.2$3.3 million for the threenine months ended March 31,September 30, 2021 compared to 2020. Parking revenue decreased by approximately $9.4 million whileand other revenue increased by approximately $2.2 million.$0.8 million and $2.5 million, respectively. The decreaseincrease in parking revenue was primarily due to a decreasean increase in transient and monthly parking. The increase in other revenue was primarily due to approximately $5.1 million in insurance proceeds related to damage at one of our properties in the New York region due to a water main break. Expensesbreak, partially offset by a decrease in other revenue of $2.2approximately $2.6 million related to thistenant restoration obligation payments in 2020 that did not recur in 2021. Expenses of $5.1 million related to the insurance claim are included within real estate operating expenses.
During the first quarter of 2021, stay-at-home orders continued to be partially lifted, businesses began to re-open, vaccines began to be distributed and people began to return to work in an office setting. We expect to see an increase in parking revenue as the return to office work grows. For the threenine months ended March 31,September 30, 2021, transient and monthly parking decreased by approximately $4.6$4.3 million, and $3.6offset by an increase in transient parking of approximately $5.6 million, respectively, compared to the threenine months ended March 31,September 30, 2020. Some of our monthly parking revenues are contractual agreements embedded in our leases, and some are at will individual agreements.
Real Estate Operating Expenses
Real estate operating expenses from the Same Property Portfolio decreasedincreased by approximately $4.8$1.8 million, or 1.9%0.3%, for the threenine months ended March 31,September 30, 2021 compared to 2020, due primarily to an increase in utility expense and expenses related to the insurance claim mentioned above, partially offset by a decrease in real estate taxes and cleaning expenses of approximately $4.8 million, or 21.2%.expenses. The decreaseincrease in cleaning expensesutility expense was experienced across the portfolio and was primarily driven by a decreasean increase in physical tenant occupancy, which led to lowerhigher demand for cleaning.electricity and HVAC.
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Properties Acquired Portfolio
The table below lists the properties acquired between January 1, 2020 and March 31,September 30, 2021. Rental revenue and real estate operating expenses increased by approximately $0.3$4.8 million and $0.5$1.9 million, respectively, for the threenine months ended March 31,September 30, 2021 compared to 2020, as detailed below.
Square FeetRental RevenueReal Estate Operating ExpensesSquare FeetRental RevenueReal Estate Operating Expenses
NameNameDate acquired20212020Change20212020ChangeNameDate acquired20212020Change20212020Change
(dollars in thousands)(dollars in thousands)
777 Harrison Street (1)777 Harrison Street (1)June 26, 2020N/A$347 $— $347 $451 $— $451 777 Harrison Street (1)June 26, 2020N/A$1,509 $300 $1,209 $1,641 $443 $1,198 
153 & 211 Second Avenue153 & 211 Second AvenueJune 2, 2021136,882 3,101 — 3,101 319 — 319 
Shady Grove Bio+Tech CampusShady Grove Bio+Tech CampusAugust 2, 2021233,452 495 — 495 334 — 334 
$347 $— $347 $451 $— $451 370,334 $5,105 $300 $4,805 $2,294 $443 $1,851 
_______________
(1)Formerly known as Fourth + Harrison and 425 Fourth Street and includes operating results for 759 Harrison Street, which was fully acquired on December 16, 2020.
Properties Placed In-Service Portfolio
The table below lists the properties that were placed in-service or partially placed in-service between January 1, 2020 and March 31,September 30, 2021. Rental revenue and real estate operating expenses from our Properties Placed In-Service Portfolio increased by approximately $6.4$19.9 million and $3.3$7.0 million, respectively, for the threenine months ended March 31,September 30, 2021 compared to 2020, as detailed below.
Quarter Initially Placed In-ServiceQuarter Fully Placed In-ServiceRental RevenueReal Estate Operating ExpensesQuarter Initially Placed In-ServiceQuarter Fully Placed In-ServiceRental RevenueReal Estate Operating Expenses
NameNameSquare Feet20212020Change20212020ChangeNameSquare Feet20212020Change20212020Change
(dollars in thousands)(dollars in thousands)
OfficeOfficeOffice
20 CityPoint20 CityPointSecond Quarter, 2019Second Quarter, 2020211,476 $1,694 $1,849 $(155)$727 $588 $139 20 CityPointSecond Quarter, 2019Second Quarter, 2020211,476 $5,781 $5,485 $296 $2,248 $2,053 $195 
17Fifty Presidents Street17Fifty Presidents StreetFirst Quarter, 2020First Quarter, 2020275,809 5,051 598 4,453 1,502 233 1,269 17Fifty Presidents StreetFirst Quarter, 2020First Quarter, 2020275,809 14,833 8,878 5,955 4,292 2,576 1,716 
One Five Nine East 53rd Street (1)One Five Nine East 53rd Street (1)First Quarter, 2021First Quarter, 2021220,000 2,676 886 1,790 719 563 156 One Five Nine East 53rd Street (1)First Quarter, 2021First Quarter, 2021220,000 10,600 (1,232)11,832 2,046 1,149 897 
Total OfficeTotal Office707,285 9,421 3,333 6,088 2,948 1,384 1,564 Total Office707,285 31,214 13,131 18,083 8,586 5,778 2,808 
ResidentialResidentialResidential
The SkylyneThe SkylyneThird Quarter, 2020Third Quarter, 2020330,996 321 — 321 1,686 — 1,686 The SkylyneThird Quarter, 2020Third Quarter, 2020330,996 1,817 23 1,794 4,918 740 4,178 
Total ResidentialTotal Residential330,996 321 — 321 1,686 — 1,686 Total Residential330,996 1,817 23 1,794 4,918 740 4,178 
1,038,281 $9,742 $3,333 $6,409 $4,634 $1,384 $3,250 1,038,281 $33,031 $13,154 $19,877 $13,504 $6,518 $6,986 
_____________
(1)This is the low-rise portion of 601 Lexington Avenue, andwhich was in development for the threenine months ended March 31,September 30, 2020. Rental revenue for the nine months ended September 30, 2020 includes an approximately $2.9 million write-off of accrued rent and accounts receivable balances for a terminated tenant.
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Properties in Development or Redevelopment Portfolio
The table below lists the properties that were in development or redevelopment between January 1, 2020 and March 31,September 30, 2021. Rental revenue and real estate operating expenses from our Properties in Development or Redevelopment Portfolio each decreased by approximately $0.7$5.6 million and $1.8 million, respectively, for the threenine months ended March 31,September 30, 2021 compared to 2020.2020, as detailed below.
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Rental RevenueReal Estate Operating ExpensesRental RevenueReal Estate Operating Expenses
NameNameDate Commenced Development / RedevelopmentSquare Feet20212020Change20212020ChangeNameDate Commenced Development / RedevelopmentSquare Feet20212020Change20212020Change
(dollars in thousands)(dollars in thousands)
325 Main Street (1)325 Main Street (1)May 9, 2019115,000 $— $— $— $17 $149 $(132)325 Main Street (1)May 9, 2019115,000 $— $36 $(36)$278 $281 $(3)
200 West Street (2)200 West Street (2)September 30, 2019261,000 1,501 1,268 233 370 843 (473)200 West Street (2)September 30, 2019261,000 4,900 3,826 1,074 2,168 2,565 (397)
880 Winter Street (3)880 Winter Street (3)February 25, 2021224,000 1,335 2,280 (945)758 805 (47)880 Winter Street (3)February 25, 2021224,000 2,476 6,290 (3,814)1,509 2,338 (829)
3625-3635 Peterson Way (4)3625-3635 Peterson Way (4)April 16, 2021218,000 1,753 4,619 (2,866)459 1,040 (581)
600,000 $2,836 $3,548 $(712)$1,145 $1,797 $(652)818,000 $9,129 $14,771 $(5,642)$4,414 $6,224 $(1,810)
_______________
(1)Real estate operating expenses for the threenine months ended March 31,September 30, 2021 and 2020 were related to demolition costs.
(2)Conversion of a 126,000 square foot portion of the property to life sciences space from office space.
(3)On February 25, 2021, we commenced the redevelopment and conversion of 880 Winter Street, a 224,000 square foot office property located in Waltham, Massachusetts, to laboratory space.
(4)On April 16, 2021, we removed 3625-3635 Peterson Way, located in Santa Clara, California, from our in-service portfolio. We are demolishing the building and expect to redevelop the site at a future date.
Properties Sold Portfolio
The table below lists the properties we sold between January 1, 2020 and March 31,September 30, 2021. Rental revenue and real estate operating expenses from our Properties Sold Portfolio decreased by approximately $11.9$17.0 million and $4.2$6.4 million, respectively, for the threenine months ended March 31,September 30, 2021 compared to 2020, as detailed below.
Rental RevenueReal Estate Operating ExpensesRental RevenueReal Estate Operating Expenses
NameNameDate SoldProperty TypeSquare Feet20212020Change20212020ChangeNameDate SoldProperty TypeSquare Feet20212020Change20212020Change
(dollars in thousands)(dollars in thousands)
601, 611 and 651 Gateway601, 611 and 651 GatewayJanuary 28, 2020Office768,000 $— $1,946 $(1,946)$— $881 $(881)601, 611 and 651 GatewayJanuary 28, 2020Office768,000 $— $1,946 $(1,946)$— $881 $(881)
New Dominion Technology ParkNew Dominion Technology ParkFebruary 20, 2020Office493,000 — 2,551 (2,551)— 772 (772)New Dominion Technology ParkFebruary 20, 2020Office493,000 — 2,551 (2,551)— 772 (772)
Capital Gallery (1)Capital Gallery (1)June 25, 2020Office631,000 2,450 9,830 (7,380)838 3,405 (2,567)Capital Gallery (1)June 25, 2020Office631,000 8,261 20,779 (12,518)2,860 7,636 (4,776)
1,892,000 $2,450 $14,327 $(11,877)$838 $5,058 $(4,220)1,892,000 $8,261 $25,276 $(17,015)$2,860 $9,289 $(6,429)
______________
(1)We completed the sale of a portion of our Capital Gallery property located in Washington, DC. Capital Gallery is an approximately 631,000 net rentable square foot Class A office property. The portion sold was comprised of approximately 455,000 net rentable square feet of commercial office space. We continue to own the land, underground parking garage and remaining commercial office and retail space. The amounts shown represent the entire property and not just the portion sold.
For additional information on the sales of the above properties and land parcel refer to “Results of Operations—Other Income and Expense Items—Gains on Sales of Real Estate” within “Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations.”
Residential Net Operating Income
Net operating income for our residential same properties decreased by approximately $1.5$2.0 million for the threenine months ended March 31,September 30, 2021 compared to 2020. Net operating income for the nine months ended September 30, 2020 includes approximately $0.7 million of termination income from a retail tenant.
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The following reflects our occupancy and rate information for The Lofts at Atlantic Wharf, The Avant at Reston Town Center, Signature at Reston and Proto Kendall Square for the threenine months ended March 31,September 30, 2021 and 2020.
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The Lofts at Atlantic WharfThe Avant at Reston Town CenterSignature at RestonProto Kendall SquareThe Lofts at Atlantic WharfThe Avant at Reston Town CenterSignature at RestonProto Kendall Square
20212020Change (%)20212020Change (%)20212020Change (%)20212020Change (%)20212020Change (%)20212020Change (%)20212020Change (%)20212020Change (%)
Average Monthly Rental Rate (1)Average Monthly Rental Rate (1)$3,474 $4,510 (23.0)%$2,287 $2,419 (5.5)%$2,265 $2,342 (3.3)%$2,585 $3,027 (14.6)%Average Monthly Rental Rate (1)$3,459 $4,424 (21.8)%$2,255 $2,381 (5.3)%$2,279 $2,327 (2.1)%$2,577 $2,865 (10.1)%
Average Rental Rate Per Occupied Square FootAverage Rental Rate Per Occupied Square Foot$3.99 $5.04 (20.8)%$2.51 $2.67 (6.0)%$2.36 $2.51 (6.0)%$4.78 $5.56 (14.0)%Average Rental Rate Per Occupied Square Foot$3.89 $4.89 (20.4)%$2.46 $2.61 (5.7)%$2.36 $2.46 (4.1)%$4.73 $5.26 (10.1)%
Average Physical Occupancy (2)Average Physical Occupancy (2)87.6 %95.0 %(7.8)%91.4 %91.5 %(0.1)%80.1 %82.2 %(2.6)%90.4 %95.5 %(5.3)%Average Physical Occupancy (2)93.4 %89.0 %4.9 %94.2 %90.2 %4.4 %86.8 %82.0 %5.9 %92.2 %91.2 %1.1 %
Average Economic Occupancy (3)Average Economic Occupancy (3)84.0 %94.3 %(10.9)%90.2 %90.3 %(0.1)%75.6 %76.9 %(1.7)%88.8 %95.2 %(6.7)%Average Economic Occupancy (3)91.0 %88.9 %2.4 %93.6 %89.2 %4.9 %83.6 %77.3 %8.2 %91.0 %90.0 %1.1 %
_______________  
(1)Average Monthly Rental Rate is calculated as the average of the quotients obtained by dividing (A) rental revenue as determined in accordance with GAAP, by (B) the number of occupied units for each month within the applicable fiscal period.
(2)Average Physical Occupancy is defined as (1) the average number of occupied units divided by (2) the total number of units, expressed as a percentage.
(3)Average Economic Occupancy is defined as (1) total possible revenue less vacancy loss divided by (2) total possible revenue, expressed as a percentage. Total possible revenue is determined by valuing average occupied units at contract rates and average vacant units at Market Rents. Vacancy loss is determined by valuing vacant units at current Market Rents. By measuring vacant units at their Market Rents, Average Economic Occupancy takes into account the fact that units of different sizes and locations within a residential property have different economic impacts on a residential property’s total possible gross revenue. Market Rents used by us in calculating Economic Occupancy are based on the current market rates set by the managers of our residential properties based on their experience in renting their residential property’s units and publicly available market data. Actual market rents and trends in such rents for a region as reported by others may vary materially from Market Rents used by us. Market Rents for a period are based on the average Market Rents during that period and do not reflect any impact for cash concessions.
Hotel Net Operating Income (Loss)Loss
Net operating income (loss) for theThe Boston Marriott Cambridge hotel property decreased byoperated at a loss of approximately $1.4$0.6 million for the threenine months ended March 31, 2021 compared toSeptember 30, 2021. This is approximately $4.3 million less than the nine months ended September 30, 2020.
The Boston Marriott Cambridge closed in March 2020 due to COVID-19. The hotel re-opened on October 2, 2020 and it has operated at a diminishedlower occupancy levels due to the continued impact of COVID-19 on business and leisure travel. The closing of the hotel for more than two fiscal quarters, weakand the lower demand and low occupancy since its re-opening, have had, and are expected to continue to have, a material adverse effect on the hotel’s operations. We expect hotel occupancy to remain low until a sufficient number of people have been vaccinated and the demand for business and leisure travel returns to historical levels.
The following reflects our occupancy and rate information for the Boston Marriott Cambridge hotel for the threenine months ended March 31,September 30, 2021 and 2020.
20212020
Change (%)
20212020
Change (%)
OccupancyOccupancy10.9 %59.6 %(81.7)%Occupancy27.8 %19.8 %40.4 %
Average daily rateAverage daily rate$123.11 $211.35 (41.8)%Average daily rate$192.67 $211.36 (8.8)%
REVPARREVPAR$13.43 $126.00 (89.3)%REVPAR$53.59 $41.85 28.1 %
Other Operating Revenue and Expense Items
Development and Management Services Revenue
Development and management services revenue decreased by approximately $1.1$3.1 million for the threenine months ended March 31,September 30, 2021 compared to 2020. Development services revenue decreased by approximately $1.6$3.8 million while management services revenue increased by approximately $0.5$0.7 million. The decrease in development
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services revenue was primarily related to a decrease in development fees earned from a building owned by a third-party in the Washington, DC region and an unconsolidated joint venture in New York City and fees associated with tenant improvement projects earned from a third-party owned building in the Washington, DC region. The increase in management services revenue was primarily related to an increase in property management feesleasing commissions earned from a third-party owned buildingsbuilding in the Washington, DC region.
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General and Administrative Expense
General and administrative expense increased by approximately $8.5$15.9 million for the threenine months ended March 31,September 30, 2021 compared to 2020 primarily due to an increase in compensation expenseand health care expenses of approximately $9.3$17.5 million, partially offset by an approximately $0.8$1.6 million decrease in other general and administrative expenses. The increase in compensation expense was related to (1) an approximately $7.1$2.7 million increase in the value of our deferred compensation plan, and (2) an approximately $2.2$13.4 million increase in other compensation-relatedcompensation expenses, primarily due to age-based vesting.vesting and (3) an approximately $1.4 million increase in health care costs. The decrease in other general and administrative expenses was primarily related to a decrease in professional fees.
Wages directly related to the development of rental properties are capitalized and included in real estate assets on our Consolidated Balance Sheets and amortized over the useful lives of the applicable asset or lease term. Capitalized wages for the threenine months ended March 31,September 30, 2021 and 2020 were approximately $3.3$10.1 million and $2.8$9.6 million, respectively. These costs are not included in the general and administrative expenses discussed above.
Transaction Costs
Transaction costs decreasedincreased by approximately $0.3$1.7 million for the threenine months ended March 31,September 30, 2021 compared to 2020 due primarily to costs incurred in connection with the pursuit and formation of new joint ventures. In general, transaction costs relating to the formation of new and pending joint ventures and the pursuit of other transactions are expensed as incurred.
Depreciation and Amortization Expense
Depreciation expense may differ between BXP and BPLP as a result of previously applied acquisition accounting by BXP for the issuance of common stock in connection with non-sponsor OP Unit redemptions by BPLP.  This accounting resulted in a step-up of the real estate assets at BXP that was allocated to certain properties.  The difference between the real estate assets of BXP as compared to BPLP for certain properties having an allocation of the real estate step-up will result in a corresponding difference in depreciation expense. For additional information see the Explanatory Note that follows the cover page of this Quarterly Report on Form 10-Q.
Boston Properties, Inc.
Depreciation and amortization expense increased by approximately $5.5$24.1 million for the threenine months ended March 31,September 30, 2021 compared to 2020, as detailed below.
PortfolioPortfolioDepreciation and Amortization for the three months ended March 31,PortfolioDepreciation and Amortization for the nine months ended September 30,
20212020Change20212020Change
(in thousands)(in thousands)
Same Property Portfolio (1)Same Property Portfolio (1)$166,372 $166,248 $124 Same Property Portfolio (1)$498,208 $498,585 $(377)
Properties Acquired PortfolioProperties Acquired Portfolio— Properties Acquired Portfolio4,742 — 4,742 
Properties Placed In-Service PortfolioProperties Placed In-Service Portfolio4,601 730 3,871 Properties Placed In-Service Portfolio14,936 5,144 9,792 
Properties in Development or Redevelopment Portfolio (2)Properties in Development or Redevelopment Portfolio (2)5,256 2,017 3,239 Properties in Development or Redevelopment Portfolio (2)20,855 8,397 12,458 
Properties Sold PortfolioProperties Sold Portfolio334 2,099 (1,765)Properties Sold Portfolio1,074 3,612 (2,538)
$176,565 $171,094 $5,471 $539,815 $515,738 $24,077 
_______________
(1)During the threenine months ended March 31,September 30, 2021, we commenced redevelopment of View Boston Observatory at The Prudential Center, Observatory, a 59,000 net rentable square foot redevelopment of the top three floors of 800 Boylston Street - The Prudential Center, located in Boston, Massachusetts. As a result, during the threenine months ended March 31,September 30, 2021, we recorded approximately $2.6 million of accelerated depreciation expense for the demolition of the space, of which approximately $0.8 million related to the step-up of real estate assets.
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(2)On February 25, 2021, we commenced redevelopment of 880 Winter Street in Waltham, Massachusetts. As a result, during the threenine months ended March 31,September 30, 2021, we recorded approximately $3.2$13.7 million of accelerated depreciation expense for the demolition of a portion of the building.
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Boston Properties Limited Partnership
Depreciation and amortization expense increased by approximately $4.2$22.9 million for the threenine months ended March 31,September 30, 2021 compared to 2020, as detailed below.
PortfolioPortfolioDepreciation and Amortization for the three months ended March 31,PortfolioDepreciation and Amortization for the nine months ended September 30,
20212020Change20212020Change
(in thousands)(in thousands)
Same Property Portfolio (1)Same Property Portfolio (1)$163,307 $164,439 $(1,132)Same Property Portfolio (1)$491,648 $493,247 $(1,599)
Properties Acquired PortfolioProperties Acquired Portfolio— Properties Acquired Portfolio4,742 — 4,742 
Properties Placed In-Service PortfolioProperties Placed In-Service Portfolio4,601 730 3,871 Properties Placed In-Service Portfolio14,936 5,144 9,792 
Properties in Development or Redevelopment Portfolio (2)Properties in Development or Redevelopment Portfolio (2)5,256 2,017 3,239 Properties in Development or Redevelopment Portfolio (2)20,855 8,397 12,458 
Properties Sold PortfolioProperties Sold Portfolio334 2,099 (1,765)Properties Sold Portfolio1,074 3,612 (2,538)
$173,500 $169,285 $4,215 $533,255 $510,400 $22,855 
_______________
(1)During the threenine months ended March 31,September 30, 2021, we commenced redevelopment of View Boston Observatory at The Prudential Center, Observatory, a 59,000 net rentable square foot redevelopment of the top three floors of 800 Boylston Street - The Prudential Center, located in Boston, Massachusetts. As a result, during the threenine months ended March 31,September 30, 2021, we recorded approximately $1.8 million of accelerated depreciation expense for the demolition of the space.
(2)On February 25, 2021, we commenced redevelopment of 880 Winter Street in Waltham, Massachusetts. As a result, during the threenine months ended March 31,September 30, 2021, we recorded approximately $3.2$13.7 million of accelerated depreciation expense for the demolition of a portion of the building.
Direct Reimbursements of Payroll and Related Costs From Management Services Contracts and Payroll and Related Costs From Management Service Contracts
We have determined that amounts reimbursed for payroll and related costs received from third parties in connection with management services contracts should be reflected on a gross basis instead of on a net basis as we have determined that we are the principal under these arrangements. We anticipate that these two financial statement line items will generally offset each other.
Other Income and Expense Items
Income (loss)Loss from Unconsolidated Joint Ventures
For the threenine months ended March 31,September 30, 2021 compared to 2020, income (loss)loss from unconsolidated joint ventures increaseddecreased by approximately $5.6$3.7 million primarily due to an approximately $10.3 million gain on sale of investment from the sale of our Annapolis Junction joint venture interest during the threenine months ended March 31,September 30, 2021 (See Note 5 to the Consolidated Financial Statements). This increase was partially offset by (1) an approximately (1) $2.9$5.8 million gain on sale of real estate from the sale of Annapolis Junction Building Eight and two undeveloped land parcels during the nine months ended September 30, 2020 and (2) an approximately $1.1 million decrease in net income from our Dock 72 and Metropolitan Square joint ventures,venture, primarily related to depreciation and amortization and (2) $0.8 million decrease in net income from our Colorado Center joint venture, primarily dueincreased interest expense related to lease expirations.the mortgage refinancing.
Gains on Sales of Real Estate
Gains on sales of real estate may differ between BXP and BPLP as a result of previously applied acquisition accounting by BXP for the issuance of common stock in connection with non-sponsor OP Unit redemptions by BPLP. This accounting resulted in a step-up of the real estate assets at BXP that was allocated to certain properties. The difference between the real estate assets of BXP as compared to BPLP for certain properties having an allocation of the real estate step-up will result in a corresponding difference in the gains on sales of real estate when those properties are sold. For additional information, see the Explanatory Note that follows the cover page of this Quarterly Report on Form 10-Q.
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Boston Properties, Inc.
Gains on sales of real estate decreased by approximately $410.2$605.6 million for the threenine months ended March 31,September 30, 2021 compared to 2020, as detailed below.
NameNameDate SoldProperty TypeSquare FeetSale PriceNet Cash ProceedsGain (Loss) on Sale of Real EstateNameDate SoldProperty TypeSquare FeetSale PriceNet Cash ProceedsGain (Loss) on Sale of Real Estate
(dollars in millions)(dollars in millions)
202120212021
N/A
6595 Springfield Center Drive6595 Springfield Center DriveDecember 13, 2018Office634,000 N/AN/A$8.1 (1)
N/AN/A$8.1 
202020202020
601, 611 and 651 Gateway601, 611 and 651 GatewayJanuary 28, 2020Office768,000 $350.0 $— $217.7 601, 611 and 651 GatewayJanuary 28, 2020Office768,000 $350.0 $— $217.7 
New Dominion Technology ParkNew Dominion Technology ParkFebruary 20, 2020Office493,000 256.0 254.0 192.3 New Dominion Technology ParkFebruary 20, 2020Office493,000 256.0 254.0 192.3 
Capital GalleryCapital GalleryJune 25, 2020Office455,000 253.7 246.6 203.6 
$606.0 $254.0 $410.0 (1)$859.7 $500.6 $613.6 (2)
___________
(1)On December 13, 2018, we sold our 6595 Springfield Center Drive development project located in Springfield, Virginia. Concurrently with the sale, we agreed to act as development manager and guaranteed the completion of the project (See Note 9 to the Consolidated Financial Statements). The development project achieved final completion during the third quarter of 2021 and, upon completion of the project, the total cost of development was determined to be below the estimated total investment at the time of sale. As a result, we recognized a gain of approximately $8.1 million.
(2)Excludes approximately $0.1 million of gains on sales of real estate recognized during the nine months ended September 30, 2020 related to gain amounts from sales of real estate occurring in the prior year.
Boston Properties Limited Partnership
Gains on sales of real estate decreased by approximately $618.6 million for the nine months ended September 30, 2021 compared to 2020, as detailed below.
NameDate SoldProperty TypeSquare FeetSale PriceNet Cash ProceedsGain (Loss) on Sale of Real Estate
(dollars in millions)
2021
6595 Springfield Center DriveDecember 13, 2018Office634,000 N/AN/A$8.1 (1)
N/AN/A$8.1 
2020
601, 611 and 651 GatewayJanuary 28, 2020Office768,000 $350.0 $— $222.4 
New Dominion Technology ParkFebruary 20, 2020Office493,000 256.0 254.0 197.1 
Capital GalleryJune 25, 2020Office455,000 253.7 246.6 207 
$859.7 $500.6 $626.5 (2)
___________
(1)On December 13, 2018, we sold our 6595 Springfield Center Drive development project located in Springfield, Virginia. Concurrently with the sale, we agreed to act as development manager and guaranteed the completion of the project (See Note 9 to the Consolidated Financial Statements). The development project achieved final completion during the third quarter of 2021 and, upon completion of the project, the total cost of development was determined to be below the estimated total investment at the time of sale. As a result, we recognized a gain of approximately $8.1 million.
(2)Excludes approximately $0.2 million of gains on sales of real estate recognized during the threenine months ended March 31,September 30, 2020 related to gain amounts from sales of real estate occurring in the prior year.
Boston Properties Limited Partnership
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Table of real estate decreased by approximately $419.7 million for the three months ended March 31, 2021 compared to 2020, as detailed below.Contents
NameDate SoldProperty TypeSquare FeetSale PriceNet Cash ProceedsGain (Loss) on Sale of Real Estate
(dollars in millions)
2021
N/A
2020
601, 611 and 651 GatewayJanuary 28, 2020Office768,000 $350.0 $— $222.4 
New Dominion Technology ParkFebruary 20, 2020Office493,000 256.0 254.0 197.1 
$606.0 $254.0 $419.5 (1)
___________
(1)Excludes approximately $0.2 million of gains on sales of real estate recognized during the three months ended March 31, 2020 related to gain amounts from sales of real estate occurring in the prior year.  
Interest and Other Income (Loss)
Interest and other income (loss) decreased by approximately $1.8$0.1 million for the threenine months ended March 31,September 30, 2021 compared to 2020, due primarily to a decrease of approximately $2.9 million in interest income as a result of lower interest earned on our deposits.deposits, partially offset by an approximately $2.8 million decrease in the allowance for current expected credit losses, which results in higher income.
On January 1, 2020, we adopted Accounting Standards Update (“ASU”) 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”) and, as a result, we were required to record an allowance for current expected credit losses related to our outstanding (1) related party note receivable, (2) notes receivable and (3) off-balance sheet credit exposures.
Gains (losses) from Investments in Securities
Gains (losses) from investments in securities for the threenine months ended March 31,September 30, 2021 and 2020 related to investments that we have made to reduce our market risk relating to deferred compensation plans that we maintain for BXP’s officers and former non-employee directors. Under the deferred compensation plans, each officer or non-employee director who is eligible to participate is permitted to defer a portion of the officer’s current income or the non-employee director’s compensation on a pre-tax basis and receive a tax-deferred return on these deferrals based on the performance of specific investments selected by the officer or non-employee director. In order to reduce our market risk relating to these plans, we typically acquire, in a separate account that is not restricted as to
58

its use, similar or identical investments as those selected by each officer or non-employee director. This enables us to generally match our liabilities to BXP’s officers or former non-employee directors under our deferred compensation plans with equivalent assets and thereby limit our market risk. The performance of these investments is recorded as gains from investments in securities. During the threenine months ended March 31,September 30, 2021 and 2020, we recognized gains (losses) of approximately $1.7$3.7 million and $(5.4)$1.0 million, respectively, on these investments. By comparison, our general and administrative expense increased (decreased) by approximately $1.7$3.7 million and $(5.4)$1.0 million during the threenine months ended March 31,September 30, 2021 and 2020, respectively, as a result of increases (decreases) in our liability under our deferred compensation plans that was associated with the performance of the specific investments selected by officers and former non-employee directors of BXP participating in the plans.
Losses From Early Extinguishment of Debt
On February 14, 2021, BPLP completed the redemption of $850.0 million in aggregate principal amount of its 4.125% senior notes due May 15, 2021. The redemption price was approximately $858.7 million, which was equal to parthe stated principal plus approximately $8.7 million of accrued and unpaid interest to, but not including, the redemption date. Excluding the accrued and unpaid interest, the redemption price was equal to the principal amount being redeemed. We recognized a loss from early extinguishment of debt totaling approximately $0.4 million related to unamortized origination costs.
On March 16, 2021, BPLP repaid $500.0 million, ofrepresenting all amounts outstanding on its borrowings under the delayed draw term loan (“Delayed Draw Facility.Facility”) under our prior unsecured revolving credit agreement (the “2017 Credit Facility”). We recognized a loss from early extinguishment of debt totaling approximately $0.5 million related to unamortized financing costs.
68

Interest Expense
Interest expense increased by approximately $6.3$0.3 million for the threenine months ended March 31,September 30, 2021 compared to 2020, as detailed below.
ComponentChange in interest expense for the threenine months ended March 31,September 30, 2021 compared to March 31,September 30, 2020
 (in thousands)
Increases to interest expense due to:
Issuance of $1.25 billion in aggregate principal of 3.250% senior notes due 2031 on May 5, 2020$10,193 
Increase in interest due to finance leases that are related to development properties1,77214,155 
Issuance of $850 million in aggregate principal of 2.550% senior notes due 2032 on March 16, 202191511,897 
Decrease in capitalized interest related to development projects3,645 
Increase in interest due to finance leases for two in-service properties5331,604 
DecreaseIncrease in capitalized interest due to finance leases that are related to development projectsproperties3451,052 
Issuance of $850 million in aggregate principal of 2.450% senior notes due 2033 on September 29, 2021116 
Total increases to interest expense13,75832,469 
Decreases to interest expense due to:
Redemption of $850 million in aggregate principal of 4.125% senior notes due 2021 on February 14, 2021(4,662)(22,550)
Decrease in interest rates for the 2017 and 2021 Credit FacilityFacilities and the repayment of the unsecured term loan on March 16, 2021 (1)(2,199)(5,196)
Increase in capitalized interest related to development projects that had finance leases(345)(3,645)
Other interest expense (excluding senior notes)(203)(658)
Decrease in interest related to the repayment of the University Place mortgage loan(38)(131)
Total decreases to interest expense(7,447)(32,180)
Total change in interest expense$6,311289 
_______________
(1)On June 15, 2021, BPLP entered into the 2021 Credit Facility, which replaced the 2017 Credit Facility (See Note 8 to the Consolidated Financial Statements).
Interest expense directly related to the development of rental properties is capitalized and included in real estate assets on our Consolidated Balance Sheets and amortized over the useful lives of the real estate or lease term. As portions of properties are placed in-service, we cease capitalizing interest on that portion and interest is then expensed. Interest capitalized for the nine months ended September 30, 2021 and 2020 was approximately $36.6 million and $41.3 million, respectively. These costs are not included in the interest expense referenced above.
On October 15, 2021, BPLP used available cash and funds under its 2021 Credit Facility to complete the redemption of $1.0 billion in aggregate principal amount of its 3.85% senior notes due February 1, 2023. The redemption price was approximately $1.05 billion, which was equal to par plus approximately $7.9 million of accrued and unpaid interest to, but not including, the redemption date and an early redemption premium and unamortized financing costs totaling approximately $43.9 million. We expect to recognize a loss from early extinguishment of debt related primarily to the payment of the redemption premium in the fourth quarter.
At September 30, 2021, our variable rate debt consisted of BPLP’s $1.5 billion revolving facility (the “Revolving Facility”). The Revolving Facility did not have an outstanding balance as of September 30, 2021. For a summary of our consolidated debt as of September 30, 2021 and September 30, 2020 refer to the heading “Liquidity and Capital Resources—Capitalization—Debt Financing” within “Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations.
5969

Noncontrolling Interests in Property Partnerships
Noncontrolling interests in property partnerships increased by approximately $18.3 million for the nine months ended September 30, 2021 compared to 2020, as detailed below.
PropertyNoncontrolling Interests in Property Partnerships for the nine months ended September 30,
20212020Change
(in thousands)
767 Fifth Avenue (the General Motors Building) (1)$8,873 $4,205 $4,668 
Times Square Tower (2)14,915 198 14,717 
601 Lexington Avenue (3)11,245 12,317 (1,072)
100 Federal Street10,211 10,874 (663)
Atlantic Wharf Office Building7,358 6,686 672 
$52,602 $34,280 $18,322 
_______________
(1)The increase was primarily attributable to an increase in lease revenue from our tenants. In addition, during the nine months ended September 30, 2020, we accelerated amortization expense related to a below-market lease that terminated early.
(2)During the nine months ended September 30, 2020, we wrote off approximately $26.8 million of accrued rent and accounts receivable balances for tenants that either terminated their leases or for which we determined their accrued rent and/or accounts receivable balances, primarily retail tenants, were no longer probable of collection. Approximately $12.0 million represents our partners’ share of the write-offs.
(3)The decrease was primarily due to a decrease in lease revenue from our retail tenants and a tenant that terminated its space during the nine months ended September 30, 2020, partially offset by the increase in revenue related to placing in-service One Five Nine East 53rd Street. During the nine months ended September 30, 2020, we wrote off approximately $2.9 million of accrued rent and accounts receivable balances for tenants that either terminated their leases or for which we determined their accrued rent and/or accounts receivable balances, primarily retail tenants, were no longer probable of collection. Approximately $1.3 million represents our partners’ share of the write-offs.
Noncontrolling Interest—Common Units of the Operating Partnership
For BXP, noncontrolling interest—common units of the Operating Partnership decreased by approximately $61.7 million for the nine months ended September 30, 2021 compared to 2020 due primarily to a decrease in allocable income, which was the result of recognizing a greater gain on sales of real estate amount during 2020. Due to our ownership structure, there is no corresponding line item on BPLP’s financial statements.
Results of Operations for the Three Months Ended September 30, 2021 and 2020
Net income attributable to Boston Properties, Inc. common shareholders and net income attributable to Boston Properties Limited Partnership common unitholders increased approximately $18.4 million and $20.4 million for the three months ended September 30, 2021 compared to 2020, respectively, as detailed in the following tables and for the reasons discussed below under the heading “Comparison of the three months ended September 30, 2021 to the three months ended September 30, 2020” within “Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Below are reconciliations of net income attributable to Boston Properties, Inc. common shareholders to NOI and net income attributable to Boston Properties Limited Partnership common unitholders to NOI for the three months ended September 30, 2021 and 2020. For a detailed discussion of NOI, including the reasons management believes NOI is useful to investors, see page 59.
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Boston Properties, Inc.
Three months ended September 30,
20212020Increase/
(Decrease)
%
Change
(in thousands)
Net Income Attributable to Boston Properties, Inc. Common Shareholders$108,297 $89,854 $18,443 20.53 %
Preferred dividends— 2,625 (2,625)(100.00)%
Net Income Attributable to Boston Properties, Inc.108,297 92,479 15,818 17.10 %
Net Income Attributable to Noncontrolling Interests:
Noncontrolling interest—common units of the Operating Partnership11,982 10,020 1,962 19.58 %
Noncontrolling interests in property partnerships18,971 15,561 3,410 21.91 %
Net Income139,250 118,060 21,190 17.95 %
Other Expenses:
Add:
Interest expense105,794 110,993 (5,199)(4.68)%
Loss from unconsolidated joint ventures5,597 6,873 (1,276)(18.57)%
Other Income:
Less:
Gains (losses) from investments in securities(190)1,858 (2,048)(110.23)%
Interest and other income (loss)1,520 (45)1,565 3,477.78 %
Gains (losses) on sales of real estate348 (209)557 266.51 %
Other Expenses:
Add:
Depreciation and amortization expense179,412 166,456 12,956 7.78 %
Transaction costs1,888 307 1,581 514.98 %
Payroll and related costs from management services contracts3,006 2,896 110 3.80 %
General and administrative expense34,560 27,862 6,698 24.04 %
Other Revenue:
Less:
Direct reimbursements of payroll and related costs from management services contracts3,006 2,896 110 3.80 %
Development and management services revenue6,094 7,281 (1,187)(16.30)%
Net Operating Income$458,729 $421,666 $37,063 8.79 %
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Boston Properties Limited Partnership
Three months ended September 30,
20212020Increase/
(Decrease)
%
Change
(in thousands)
Net Income Attributable to Boston Properties Limited Partnership Common Unitholders$122,014 $101,624 $20,390 20.06 %
Preferred distributions— 2,625 (2,625)(100.00)%
Net Income Attributable to Boston Properties Limited Partnership122,014 104,249 17,765 17.04 %
Net Income Attributable to Noncontrolling Interests:
Noncontrolling interests in property partnerships18,971 15,561 3,410 21.91 %
Net Income140,985 119,810 21,175 17.67 %
Other Expenses:
Add:
Interest expense105,794 110,993 (5,199)(4.68)%
Loss from unconsolidated joint ventures5,597 6,873 (1,276)(18.57)%
Other Income:
Less:
Gains (losses) from investments in securities(190)1,858 (2,048)(110.23)%
Interest and other income (loss)1,520 (45)1,565 3,477.78 %
Gains (losses) on sales of real estate348 (209)557 266.51 %
Other Expenses:
Add:
Depreciation and amortization expense177,677 164,706 12,971 7.88 %
Transaction costs1,888 307 1,581 514.98 %
Payroll and related costs from management services contracts3,006 2,896 110 3.80 %
General and administrative expense34,560 27,862 6,698 24.04 %
Other Revenue:
Less:
Direct reimbursements of payroll and related costs from management services contracts3,006 2,896 110 3.80 %
Development and management services revenue6,094 7,281 (1,187)(16.30)%
Net Operating Income$458,729 $421,666 $37,063 8.79 %

Comparison of the three months ended September 30, 2021 to the three months ended September 30, 2020
The table below shows selected operating information for the Same Property Portfolio and the Total Property Portfolio. The Same Property Portfolio consists of 143 properties totaling approximately 39.7 million net rentable square feet, excluding unconsolidated joint ventures. The Same Property Portfolio includes properties acquired or placed in-service on or prior to July 1, 2020 and owned and in-service through September 30, 2021. The Total Property Portfolio includes the effects of the other properties either acquired, placed in-service, in development or redevelopment after July 1, 2020 or disposed of on or prior to September 30, 2021. This table includes a reconciliation from the Same Property Portfolio to the Total Property Portfolio by also providing information for the three months ended September 30, 2021 and 2020 with respect to the properties that were acquired, placed in-service, in development or redevelopment or sold. We did not sell any properties during the three months ended September 30, 2021 and 2020.

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 Same Property PortfolioProperties
Acquired Portfolio
Properties
Placed In-Service
Portfolio
Properties in
Development or
Redevelopment
Portfolio
Total Property Portfolio
20212020Increase/
(Decrease)
%
Change
20212020202120202021202020212020Increase/
(Decrease)
%
Change
(dollars in thousands)
Rental Revenue: (1)
Lease Revenue (Excluding Termination Income)$671,248 $649,484 $21,764 3.35 %$2,840 $— $3,904 $157 $1,752 $4,753 $679,744 $654,394 $25,350 3.87 %
Termination Income1,874 2,715 (841)(30.98)%— — — — — — 1,874 2,715 (841)(30.98)%
Lease Revenue673,122 652,199 20,923 3.21 %2,840 — 3,904 157 1,752 4,753 681,618 657,109 24,509 3.73 %
Parking and Other23,250 16,170 7,080 43.78 %— — — — 23,255 16,174 7,081 43.78 %
Total Rental Revenue (1)696,372 668,369 28,003 4.19 %2,840 — 3,909 161 1,752 4,753 704,873 673,283 31,590 4.69 %
Real Estate Operating Expenses249,844 250,951 (1,107)(0.44)%582 — 648 307 1,162 2,048 252,236 253,306 (1,070)(0.42)%
Net Operating Income (Loss), Excluding Residential and Hotel446,528 417,418 29,110 6.97 %2,258 — 3,261 (146)590 2,705 452,637 419,977 32,660 7.78 %
Residential Net Operating Income (Loss) (2)5,731 5,480 251 4.58 %— — (882)(717)— — 4,849 4,763 86 1.81 %
Hotel Net Operating Income (Loss) (2)1,243 (3,074)4,317 140.44 %— — — — — — 1,243 (3,074)4,317 140.44 %
Net Operating Income (Loss)$453,502 $419,824 $33,678 8.02 %$2,258 $— $2,379 $(863)$590 $2,705 $458,729 $421,666 $37,063 8.79 %
_______________
(1)Rental Revenue is equal to Revenue less Development and Management Services Revenue and Direct Reimbursements of Payroll and Related Costs from Management Services Revenue per the Consolidated Statements of Operations, excluding the residential and hotel revenue that is noted below. We use Rental Revenue internally as a performance measure and in calculating other non-GAAP financial measures (e.g., NOI), which provides investors with information regarding our performance that is not immediately apparent from the comparable non-GAAP measures and allows investors to compare operating performance between periods.
(2)For a detailed discussion of NOI, including the reasons management believes NOI is useful to investors, see page 59. Residential Net Operating Income for the three months ended September 30, 2021 and 2020 is comprised of Residential Revenue of $10,894 and $9,718 less Residential Expenses of $6,045 and $4,955, respectively. Hotel Net Operating Income (Loss) for the three months ended September 30, 2021 and 2020 is comprised of Hotel Revenue of $5,189 and $90 less Hotel Expenses of $3,946 and $3,164, respectively, per the Consolidated Statements of Operations.
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Same Property Portfolio
Lease Revenue (Excluding Termination Income)
Lease revenue from the Same Property Portfolio increased by approximately $21.8 million for the three months ended September 30, 2021 compared to 2020. Approximately $7.5 million of the increase related to write-offs of accrued rent and accounts receivable balances that occurred during the three months ended September 30, 2020 and did not recur in 2021, for primarily retail tenants that either terminated their leases or we determined that the accrued rent and/or accounts receivable balances were no longer probable of collection. Excluding the write-offs, the Same Property Portfolio increased by approximately $14.3 million primarily due to our average revenue per square foot increasing by approximately $2.77, resulting in an increase of approximately $24.1 million, partially offset by an approximately $9.8 million decrease due to our average occupancy decreasing from 92.4% to 91.0%.
We continue to evaluate the collectability of our accrued rent and accounts receivable balances related to lease revenue. If after a write-off has been recorded, (1) we subsequently determine that we are probable we will collect substantially all the remaining lessee’s lease payments under the lease term and (2) the lease has not been modified since the write-off, we will then reinstate the accrued rent and accounts receivable write-offs, adjusting for the amount related to the period when the lease payments were considered not probable of collection. If our estimate of collectability differs from the cash received, then the timing and amount of our reported revenue could be impacted.
Each quarter since the second quarter of 2020, the number of executed COVID-19 lease modifications has decreased and as of the third quarter of 2021, we are executing COVID-19 modifications on a limited basis.
Termination Income
Termination income decreased by approximately $0.8 million for the three months ended September 30, 2021 compared to 2020.
Termination income for the three months ended September 30, 2021 related to six tenants across the Same Property Portfolio and totaled approximately $1.9 million, which was primarily related to tenants that terminated leases early in New York City.
Termination income for the three months ended September 30, 2020 related to 10 tenants across the Same Property Portfolio and totaled approximately $2.7 million, which was primarily related to tenants that terminated leases early in New York City and the Washington, DC region.
Parking and Other Revenue
Parking and other revenue increased by approximately $7.1 million for the three months ended September 30, 2021 compared to 2020. Parking revenue and other revenue increased by approximately $6.3 million and $0.8 million, respectively. The increase in parking revenue was primarily due to an increase in transient parking.
Real Estate Operating Expenses
Real estate operating expenses from the Same Property Portfolio decreased by approximately $1.1 million, or 0.4%, for the three months ended September 30, 2021 compared to 2020, due primarily to a decrease in real estate taxes of approximately $5.9 million, or 4.4%, offset by an increase in utility and other real estate operating expenses of approximately $3.1 million, or 12.1%, and $1.7 million, or 1.9%, respectively. The decrease in real estate taxes was primarily experienced in New York City. The increase in utility expense was experienced across the portfolio and was primarily driven by an increase in physical tenant occupancy, which led to higher demand for electricity and HVAC.
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Properties Acquired Portfolio
The table below lists the properties acquired between July 1, 2020 and September 30, 2021. Rental revenue and real estate operating expenses increased by approximately $2.8 million and $0.6 million, respectively, for the three months ended September 30, 2021 compared to 2020, as detailed below.
Square FeetRental RevenueReal Estate Operating Expenses
NameDate acquired20212020Change20212020Change
(dollars in thousands)
153 & 211 Second AvenueJune 2, 2021136,882 $2,345 $— $2,345 $248 $— $248 
Shady Grove Bio+Tech CampusAugust 2, 2021233,452 495 — 495 334 — 334 
370,334 $2,840 $— $2,840 $582 $— $582 

Properties Placed In-Service Portfolio
The table below lists the properties that were placed in-service or partially placed in-service between July 1, 2020 and September 30, 2021. Rental revenue and real estate operating expenses from our Properties Placed In-Service Portfolio increased by approximately $4.5 million and $1.3 million, respectively, for the three months ended September 30, 2021 compared to 2020, as detailed below.
Quarter Initially Placed In-ServiceQuarter Fully Placed In-ServiceRental RevenueReal Estate Operating Expenses
NameSquare Feet20212020Change20212020Change
(dollars in thousands)
Office
One Five Nine East 53rd Street (1)First Quarter, 2021First Quarter, 2021220,000 $3,909 $161 $3,748 $648 $307 $341 
Total Office220,000 3,909 161 3,748 648 307 341 
Residential
The SkylyneThird Quarter, 2020Third Quarter, 2020330,996 806 23 783 1,688 740 948 
Total Residential330,996 806 23 783 1,688 740 948 
550,996 $4,715 $184 $4,531 $2,336 $1,047 $1,289 
_______________
(1)This is the low-rise portion of 601 Lexington Avenue, which was in development for the three months ended September 30, 2020.

Properties in Development or Redevelopment Portfolio
The table below lists the properties that were in development or redevelopment between July 1, 2020 and September 30, 2021. Rental revenue and real estate operating expenses from our Properties in Development or Redevelopment Portfolio decreased by approximately $3.0 million and $0.9 million, respectively, for the three months ended September 30, 2021 compared to 2020.
Rental RevenueReal Estate Operating Expenses
NameDate Commenced Development / RedevelopmentSquare Feet20212020Change20212020Change
(dollars in thousands)
325 Main Street (1)May 9, 2019115,000 $— $— $— $169 $207 $(38)
200 West Street (2)September 30, 2019261,000 1,752 1,233 519 932 784 148 
880 Winter Street (3)February 25, 2021224,000 — 1,977 (1,977)61 706 (645)
3625-3635 Peterson Way (4)April 16, 2021218,000 — 1,543 (1,543)— 351 (351)
818,000 $1,752 $4,753 $(3,001)$1,162 $2,048 $(886)
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_______________
(1)Real estate operating expenses for the three months ended September 30, 2021 and 2020 were related to demolition costs.
(2)Conversion of a 126,000 square foot portion of the property to life sciences space from office space.
(3)On February 25, 2021, we commenced the redevelopment and conversion of 880 Winter Street, a 224,000 square foot office property located in Waltham, Massachusetts, to laboratory space.
(4)On April 16, 2021, we removed 3625-3635 Peterson Way, located in Santa Clara, California, from our in-service portfolio. We are demolishing the building and expect to redevelop the site at a future date.
Residential Net Operating Income
Net operating income for our residential same properties increased by approximately $0.3 million for the three months ended September 30, 2021 compared to 2020. Net operating income for the three months ended September 30, 2020 includes approximately $0.7 million of termination income from a retail tenant.
The following reflects our occupancy and rate information for The Lofts at Atlantic Wharf, The Avant at Reston Town Center, Signature at Reston and Proto Kendall Square for the three months ended September 30, 2021 and 2020.
The Lofts at Atlantic WharfThe Avant at Reston Town CenterSignature at RestonProto Kendall Square
20212020Change (%)20212020Change (%)20212020Change (%)20212020Change (%)
Average Monthly Rental Rate (1)$3,747 $4,231 (11.4)%$2,299 $2,352 (2.3)%$2,429 $2,319 4.7 %$2,642 $2,676 (1.3)%
Average Rental Rate Per Occupied Square Foot$4.17 $4.62 (9.7)%$2.50 $2.57 (2.7)%$2.51 $2.42 3.7 %$4.82 $4.91 (1.8)%
Average Physical Occupancy (2)96.5 %80.2 %20.3 %96.3 %89.7 %7.4 %93.2 %82.2 %13.4 %94.5 %85.7 %10.3 %
Average Economic Occupancy (3)95.4 %80.7 %18.2 %96.3 %88.9 %8.3 %92.0 %78.2 %17.6 %93.9 %83.1 %13.0 %
_______________  
(1)Average Monthly Rental Rate is calculated as the average of the quotients obtained by dividing (A) rental revenue as determined in accordance with GAAP, by (B) the number of occupied units for each month within the applicable fiscal period.
(2)Average Physical Occupancy is defined as (1) the average number of occupied units divided by (2) the total number of units, expressed as a percentage.
(3)Average Economic Occupancy is defined as (1) total possible revenue less vacancy loss divided by (2) total possible revenue, expressed as a percentage. Total possible revenue is determined by valuing average occupied units at contract rates and average vacant units at Market Rents. Vacancy loss is determined by valuing vacant units at current Market Rents. By measuring vacant units at their Market Rents, Average Economic Occupancy takes into account the fact that units of different sizes and locations within a residential property have different economic impacts on a residential property’s total possible gross revenue. Market Rents used by us in calculating Economic Occupancy are based on the current market rates set by the managers of our residential properties based on their experience in renting their residential property’s units and publicly available market data. Actual market rents and trends in such rents for a region as reported by others may vary materially from Market Rents used by us. Market Rents for a period are based on the average Market Rents during that period and do not reflect any impact for cash concessions.
Hotel Net Operating Income (Loss)
The Boston Marriott Cambridge hotel property operated at an approximately $1.2 million profit during the three months ended September 30, 2021. This is approximately $4.3 million greater than the three months ended September 30, 2020.
The Boston Marriott Cambridge closed in March 2020 due to COVID-19. The hotel re-opened on October 2, 2020 and has operated at lower occupancy levels due to the continued impact of COVID-19 on business and leisure travel. The closing of the hotel for more than two fiscal quarters, and the lower demand and low occupancy since its re-opening, have had, and are expected to continue to have, a material adverse effect on the hotel’s operations. We expect hotel occupancy to remain low until the demand for business and leisure travel returns to historical levels.
The following reflects our occupancy and rate information for the Boston Marriott Cambridge hotel for the three months ended September 30, 2021 and 2020.
76

20212020
Change (%)
Occupancy49.4 %— %100.0 %
Average daily rate$222.31 $— 100.0 %
REVPAR$109.86 $— 100.0 %
Other Operating Revenue and Expense Items
Development and Management Services Revenue
Development and management services revenue decreased by approximately $1.2 million for the three months ended September 30, 2021 compared to 2020. Development and management services revenue decreased by approximately $1.1 million and $0.1 million, respectively. The decrease in development services revenue was primarily related to a decrease of approximately $0.6 million in development fees earned in New York City from an unconsolidated joint venture and a decrease of approximately $0.5 million in fees associated with tenant improvement projects earned from a building owned by a third-party in the Washington, DC region. The decrease in management services revenue was primarily related to a decrease in property management fees earned from third-party owned buildings in the Washington, DC region.
General and Administrative Expense
General and administrative expense increased by approximately $6.7 million for the three months ended September 30, 2021 compared to 2020 primarily due to an increase in compensation expense of approximately $6.4 million, and an increase of approximately $0.3 million in other general and administrative expenses. The increase in compensation expense was partially offset by a decrease of approximately $2.1 million in the value of our deferred compensation plan. The increase in other general and administrative expenses was primarily related to an increase in meals and travel expense.
Wages directly related to the development of rental properties are capitalized and included in real estate assets on our Consolidated Balance Sheets and amortized over the useful lives of the applicable asset or lease term. Capitalized wages for the three months ended September 30, 2021 and 2020 were approximately $3.4 million. These costs are not included in the general and administrative expenses discussed above.
Transaction Costs
Transaction costs increased by approximately $1.6 million for the three months ended September 30, 2021 compared to 2020 due primarily to costs incurred in connection with the pursuit and formation of new joint ventures. In general, transaction costs relating to the formation of new and pending joint ventures and the pursuit of other transactions are expensed as incurred.
Depreciation and Amortization Expense
Depreciation expense may differ between BXP and BPLP as a result of previously applied acquisition accounting by BXP for the issuance of common stock in connection with non-sponsor OP Unit redemptions by BPLP.  This accounting resulted in a step-up of the real estate assets at BXP that was allocated to certain properties.  The difference between the real estate assets of BXP as compared to BPLP for certain properties having an allocation of the real estate step-up will result in a corresponding difference in depreciation expense. For additional information see the Explanatory Note that follows the cover page of this Quarterly Report on Form 10-Q.
Boston Properties, Inc.
Depreciation and amortization expense increased by approximately $13.0 million for the three months ended September 30, 2021 compared to 2020, as detailed below.
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PortfolioDepreciation and Amortization for the three months ended September 30,
20212020Change
(in thousands)
Same Property Portfolio$171,977 $163,114 $8,863 
Properties Acquired Portfolio3,761 — 3,761 
Properties Placed In-Service Portfolio3,295 695 2,600 
Properties in Development or Redevelopment Portfolio379 2,647 (2,268)
$179,412 $166,456 $12,956 

Boston Properties Limited Partnership
Depreciation and amortization expense increased by approximately $13.0 million for the three months ended September 30, 2021 compared to 2020, as detailed below.
PortfolioDepreciation and Amortization for the three months ended September 30,
20212020Change
(in thousands)
Same Property Portfolio$170,242 $161,364 $8,878 
Properties Acquired Portfolio3,761 — 3,761 
Properties Placed In-Service Portfolio3,295 695 2,600 
Properties in Development or Redevelopment Portfolio379 2,647 (2,268)
$177,677 $164,706 $12,971 

Direct Reimbursements of Payroll and Related Costs From Management Services Contracts and Payroll and Related Costs From Management Service Contracts
We have determined that amounts reimbursed for payroll and related costs received from third parties in connection with management services contracts should be reflected on a gross basis instead of on a net basis as we have determined that we are the principal under these arrangements. We anticipate that these two financial statement line items will generally offset each other.
Other Income and Expense Items
Loss from Unconsolidated Joint Ventures
For the three months ended September 30, 2021 compared to 2020, loss from unconsolidated joint ventures decreased by approximately $1.3 million due to a $2.2 million increase in net income at our Colorado Center joint venture, primarily due to a write-off of lease revenue during the three months ended September 30, 2020. This increase was partially offset by an approximately $1.1 million decrease in net income from our Dock 72 joint venture, primarily related to depreciation and amortization.
Gains (Losses) on Sales of Real Estate
Gains (losses) on sales of real estate increased by approximately $0.6 million for the three months ended September 30, 2021 compared to 2020. During the three months ended September 30, 2021, we recognized a gain of approximately $0.3 million related to the sale of 6595 Springfield Center Drive (See Note 3 to the Consolidated Financial Statements). During the three months ended September 30, 2020, we incurred approximately $0.2 million of additional expenses related to the sale of a portion of Capital Gallery in Washington, DC, thus resulting in a loss on sale of real estate.
Interest and Other Income (Loss)
Interest and other income (loss) increased by approximately $1.6 million for the three months ended September 30, 2021 compared to 2020, due to an approximately $1.9 million decrease in the allowance for current
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expected credit losses, which results in higher income, partially offset by a decrease of approximately $0.3 million in interest income as a result of lower interest earned on our deposits.
On January 1, 2020, we adopted ASU 2016-13 and, as a result, we were required to record an allowance for current expected credit losses related to our outstanding (1) related party note receivable, (2) notes receivable and (3) off-balance sheet credit exposures.
Gains (Losses) from Investments in Securities
Gains (losses) from investments in securities for the three months ended September 30, 2021 and 2020 related to investments that we have made to reduce our market risk relating to deferred compensation plans that we maintain for BXP’s officers and former non-employee directors. Under the deferred compensation plans, each officer or non-employee director who is eligible to participate is permitted to defer a portion of the officer’s current income or the non-employee director’s compensation on a pre-tax basis and receive a tax-deferred return on these deferrals based on the performance of specific investments selected by the officer or non-employee director. In order to reduce our market risk relating to these plans, we typically acquire, in a separate account that is not restricted as to its use, similar or identical investments as those selected by each officer or non-employee director. This enables us to generally match our liabilities to BXP’s officers or former non-employee directors under our deferred compensation plans with equivalent assets and thereby limit our market risk. The performance of these investments is recorded as gains (losses) from investments in securities. During the three months ended September 30, 2021 and 2020, we recognized gains (losses) of approximately $(0.2) million and $1.9 million, respectively, on these investments. By comparison, our general and administrative expense increased (decreased) by approximately $(0.2) million and $1.9 million during the three months ended September 30, 2021 and 2020, respectively, as a result of increases (decreases) in our liability under our deferred compensation plans that was associated with the performance of the specific investments selected by officers and former non-employee directors of BXP participating in the plans.
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Interest Expense
Interest expense decreased by approximately $5.2 million for the three months ended September 30, 2021 compared to 2020, as detailed below.
ComponentChange in interest expense for the three months ended September 30, 2021 compared to September 30, 2020
(in thousands)
Increases to interest expense due to:
Issuance of $850 million in aggregate principal of 2.550% senior notes due 2032 on March 16, 2021$5,491 
Decrease in capitalized interest related to development projects2,876 
Increase in interest due to finance leases for two in-service properties447 
Issuance of $850 million in aggregate principal of 2.450% senior notes due 2033 on September 29, 2021116 
Total increases to interest expense8,930 
Decreases to interest expense due to:
Redemption of $850 million in aggregate principal of 4.125% senior notes due 2021 on February 14, 2021(8,945)
Increase in capitalized interest related to development projects that had finance leases(2,876)
Decrease in interest due to finance leases that are related to development properties(999)
Decrease in interest rates for the 2017 and 2021 Credit Facilities and the repayment of the unsecured term loan on March 16, 2021 (1)(981)
Other interest expense (excluding senior notes)(286)
Decrease in interest related to the repayment of University Place mortgage loan(42)
Total decreases to interest expense(14,129)
Total change in interest expense$(5,199)
_______________
(1) On June 15, 2021, BPLP entered into the 2021 Credit Facility, which replaced the 2017 Credit Facility (See Note 8 to the Consolidated Financial Statements).
Interest expense directly related to the development of rental properties is capitalized and included in real estate assets on our Consolidated Balance Sheets and amortized over the useful lives of the real estate or lease term. As portions of properties are placed in-service, we cease capitalizing interest on that portion and interest is then expensed. Interest capitalized for the three months ended March 31,September 30, 2021 and 2020 was approximately $12.0$11.6 million and $14.1$13.5 million, respectively. These costs are not included in the interest expense referenced above.
On October 15, 2021, BPLP used available cash and funds under its 2021 Credit Facility to complete the redemption of $1.0 billion in aggregate principal amount of its 3.85% senior notes due February 1, 2023. The redemption price was approximately $1.05 billion, which was equal to par plus approximately $7.9 million of accrued and unpaid interest to, but not including, the redemption date and an early redemption premium and unamortized financing costs totaling approximately $43.9 million. We expect to recognize a loss from early extinguishment of debt related primarily to the payment of the redemption premium in the fourth quarter.
At March 31,September 30, 2021, our outstanding variable rate debt consisted of BPLP’s $1.5 billion revolving line of credit (the “Revolving Facility”). Revolving Facility. The Revolving Facility did not have an outstanding balance as of March 31,September 30, 2021. For a summary of our consolidated debt as of March 31,September 30, 2021 and March 31,September 30, 2020 refer to the heading “Liquidity and Capital Resources—Capitalization—Debt Financing” within “Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations.
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Noncontrolling Interests in Property Partnerships
Noncontrolling interests in property partnerships decreasedincreased by approximately $3.0$3.4 million for the three months ended March 31,September 30, 2021 compared to 2020, as detailed below.
PropertyPropertyNoncontrolling Interests in Property Partnerships for the three months ended March 31,PropertyNoncontrolling Interests in Property Partnerships for the three months ended September 30,
20212020Change20212020Change
(in thousands)(in thousands)
767 Fifth Avenue (the General Motors Building)(1)767 Fifth Avenue (the General Motors Building)(1)$2,295 $1,660 $635 767 Fifth Avenue (the General Motors Building)(1)$3,406 $2,104 $1,302 
Times Square Tower (1)Times Square Tower (1)4,901 6,869 (1,968)Times Square Tower (1)4,995 3,545 1,450 
601 Lexington Avenue (2)601 Lexington Avenue (2)3,752 4,850 (1,098)601 Lexington Avenue (2)4,436 4,352 84 
100 Federal Street100 Federal Street3,349 3,661 (312)100 Federal Street3,421 3,565 (144)
Atlantic Wharf Office Building(2)Atlantic Wharf Office Building(2)2,170 2,446 (276)Atlantic Wharf Office Building(2)2,713 1,995 718 
$16,467 $19,486 $(3,019)$18,971 $15,561 $3,410 
_______________
(1)The decreaseincrease was primarily dueattributable to a decrease in lease revenue from signage and a tenant in the retail industry. During 2020, we executed a lease modification with a tenant in the retail industry, which involved a decrease in rent as well as a space reduction.
(2)The decrease was primarily due to a decreasean increase in lease revenue from our retail tenants and a tenant that terminated its space duringtenants.
(2)During the three months ended March 31, 2020.September 30, 2020, we wrote off approximately $0.5 million of accrued rent and accounts receivable balances for retail tenants whose balances we determined were no longer probable of collection. Approximately $0.2 million represents our partners’ share of the write-offs.
Noncontrolling Interest—Common Units of the Operating Partnership
For BXP, noncontrolling interest—common units of the Operating Partnership decreasedincreased by approximately $46.5$2.0 million for the three months ended March 31,September 30, 2021 compared to 2020 due primarily to a decreasean increase in allocable income, which was the result of recognizing a greater gain on sales of real estate amount during 2020.income. Due to our ownership structure, there is no corresponding line item on BPLP’s financial statements.
Liquidity and Capital Resources
General
Our principal liquidity needs for the next twelve months and beyond are to:
fund normal recurring expenses;
meet debt service and principal repayment obligations, including balloon payments on maturing debt;
fund development and redevelopment costs;
fund capital expenditures, including major renovations, tenant improvements and leasing costs;
fund plannedpending and possible acquisitions of properties, either directly or indirectly through the acquisition of equity interests therein; and
make the minimum distribution required to enable BXP to maintain its REIT qualification under the Internal Revenue Code of 1986, as amended.
We expect to satisfy these needs using one or more of the following:
cash flow from operations;
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distribution of cash flows from joint ventures;
cash and cash equivalent balances;
borrowings under BPLP’s 20172021 Credit Facility, short-term bridge facilities and construction loans;
long-term secured and unsecured indebtedness (including unsecured exchangeable indebtedness);
sales of real estate; and
issuances of BXP equity securities and/or preferred or common units of partnership interest in BPLP.
We draw on multiple financing sources to fund our long-term capital needs. We expect to fund our current development properties primarily with our available cash balances, construction loans and BPLP’s Revolving Facility. We use BPLP’s Revolving Facility primarily as a bridge facility to fund acquisition opportunities, refinance outstanding indebtedness and meet short-term development and working capital needs. Although we may seek to fund our development projects with construction loans, which may require guarantees by BPLP, the financing for each particular project ultimately depends on several factors, including, among others, the project’s size and duration, the extent of pre-leasing and our available cash and access to cost effective capital at the given time.

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The following table presents information on properties under construction and redevelopment as of March 31,September 30, 2021 (dollars in thousands):
FinancingsFinancings
Construction PropertiesConstruction PropertiesEstimated Stabilization DateLocation# of BuildingsEstimated Square FeetInvestment to Date (1)(2)(3)Estimated Total Investment (1)(2)Total Available (1)Outstanding at 3/31/2021 (1)Estimated Future Equity Requirement (1)(2)(4)Percentage Leased (5)Construction PropertiesEstimated Stabilization DateLocation# of BuildingsEstimated Square FeetInvestment to Date (1)(2)(3)Estimated Total Investment (1)(2)Total Available (1)Outstanding at 9/30/2021 (1)Estimated Future Equity Requirement (1)(2)(4)Percentage Leased (5)
OfficeOfficeOffice
325 Main Street325 Main StreetThird Quarter, 2022Cambridge, MA420,000 $217,456 $418,400 $— $— $200,944 90 %325 Main StreetThird Quarter, 2022Cambridge, MA420,000 $283,920 $418,400 $— $— $134,480 90 %
100 Causeway Street (50% ownership)100 Causeway Street (50% ownership)Third Quarter, 2022Boston, MA632,000 202,068 267,300 200,000 125,306 — 94 %100 Causeway Street (50% ownership)Third Quarter, 2022Boston, MA632,000 229,627 267,300 200,000 148,603 — 95 %(6)
7750 Wisconsin Avenue (Marriott International Headquarters) (50% ownership)7750 Wisconsin Avenue (Marriott International Headquarters) (50% ownership)Second Quarter, 2022Bethesda, MD734,000 159,250 198,900 127,500 90,229 2,379 100 %7750 Wisconsin Avenue (Marriott International Headquarters) (50% ownership)First Quarter, 2022Bethesda, MD734,000 168,945 198,900 127,500 104,036 6,491 100 %(7)
Reston NextReston NextFourth Quarter, 2023Reston, VA1,062,000 422,881 715,300 — — 292,419 85 %Reston NextFourth Quarter, 2023Reston, VA1,062,000 507,726 715,300 — — 207,574 85 %(8)
2100 Pennsylvania Avenue2100 Pennsylvania AvenueThird Quarter, 2024Washington, DC480,000 157,235 356,100 — — 198,865 56 %2100 Pennsylvania AvenueThird Quarter, 2024Washington, DC480,000 209,193 356,100 — — 146,907 56 %
Total Office Properties under ConstructionTotal Office Properties under Construction3,328,000 1,158,890 1,956,000 327,500 215,535 694,607 86 %Total Office Properties under Construction3,328,000 1,399,411 1,956,000 327,500 252,639 495,452 87 %
Lab/Life SciencesLab/Life SciencesLab/Life Sciences
200 West Street (Redevelopment)200 West Street (Redevelopment)Fourth Quarter, 2021Waltham, MA— 138,000 18,116 47,800 — — 29,684 100 %(6)200 West Street (Redevelopment)Fourth Quarter, 2021Waltham, MA— 138,000 29,340 47,800 — — 18,460 100 %(9)
880 Winter Street (Redevelopment)880 Winter Street (Redevelopment)Second Quarter, 2024Waltham, MA224,000 1,634 108,000 — — 106,366 — %880 Winter Street (Redevelopment)Second Quarter, 2024Waltham, MA224,000 6,964 108,000 — — 101,036 23 %
751 Gateway (49% ownership)751 Gateway (49% ownership)Third Quarter, 2024South San Francisco, CA229,000 15,420 127,600 — — 112,180 — %751 Gateway (49% ownership)Third Quarter, 2024South San Francisco, CA229,000 28,723 127,600 — — 98,877 — %
180 CityPoint180 CityPointFourth Quarter, 2024Waltham, MA329,000 20,382 274,700 — — 254,318 — %180 CityPointFourth Quarter, 2024Waltham, MA329,000 41,442 274,700 — — 233,258 — %
Total Lab/Life Sciences Properties under ConstructionTotal Lab/Life Sciences Properties under Construction920,000 55,552 558,100 — — 502,548 15 %Total Lab/Life Sciences Properties under Construction920,000 106,469 558,100 — — 451,631 21 %
OtherOtherOther
The Prudential Center Observatory (Redevelopment)N/ABoston, MA— 59,000 25,018 182,300 — — 157,282 N/A
View Boston Observatory at The Prudential Center (Redevelopment)View Boston Observatory at The Prudential Center (Redevelopment)N/ABoston, MA— 59,000 45,158 182,300 — — 137,142 N/A
Total Properties under ConstructionTotal Properties under Construction4,307,000 $1,239,460 $2,696,400 $327,500 $215,535 $1,354,437 71 %(7)Total Properties under Construction4,307,000 $1,551,038 $2,696,400 $327,500 $252,639 $1,084,225 72 %(10)
___________  
(1)Represents our share.
(2)Investment to Date, Estimated Total Investment and Estimated Future Equity Requirement all include our share of acquisition expenses, as applicable, and reflect our share of the estimated net revenue/expenses that we expect to incur prior to stabilization of the project, including any amounts actually received or paid through March 31,September 30, 2021.
(3)Includes approximately $72.7$77.8 million of unpaid but accrued construction costs and leasing commissions.
(4)Excludes approximately $72.7$77.8 million of unpaid but accrued construction costs and leasing commissions.
(5)Represents percentage leased as of May 3,November 2, 2021, including leases with future commencement dates.
(6)This property was 79% placed in-service as of September 30, 2021.
(7)On October 29, 2021, this project was fully placed in-service (See Note 15 to the Consolidated Financial Statements).
(8)On October 19, 2021, approximately 285,000 square feet of the project was placed in-service.
(9)Represents a portion of the property under redevelopment for conversion to life scienceslaboratory space.
(7)(10)Percentage leased excludes View Boston Observatory at The Prudential Center Observatory redevelopment(redevelopment) at 800 Boylston Street - The Prudential Center.

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Lease revenue (which includes recoveries from tenants), other income from operations, available cash balances, mortgage financings, unsecured indebtedness and draws on BPLP’s Revolving Facility are the principal sources of capital that we use to fund operating expenses, debt service, maintenance and repositioning capital expenditures, tenant improvements and the minimum distribution required to enable BXP to maintain its REIT qualification. We seek to maximize 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 property management, leasing and development and construction businesses, as well as the sale of assets from time to time. We believe these sources of capital will continue to provide the funds necessary for our short-term liquidity needs, including our properties under development and redevelopment.
Material adverse changes in one or more sources of capital, whether due to the impacts of the COVID-19 pandemic or otherwise, may adversely affect our net cash flows. During
Leasing activity and revenue from transient parking and our hotel improved during the third quarter of 2021.We signed approximately 1.4 million square feet of leases in the quarter, which represents more than double the leasing volume in the first quarter of 2021 and is approximately 90% of our rent collections remained strong as we collected 99.6% of rents from our office tenants and 99.0% of rents from all tenants, including retail tenants. The COVID-19 pandemic also continued to cause material declines inpre-pandemic average for the third quarter. Our parking and otherhotel revenue and revenue from our hotel foralso increased approximately 36% compared to the firstsecond quarter of 2021 when compared2021. We expect parking revenue to pre-COVID-19 levels.
Cash rent abatementscontinue to improve gradually as the return to in-person work accelerates and deferrals primarily related hotel occupancy to COVID-19 were approximately $9.1 million inremain low until the first quarter, approximately 51% less than the average of the three most recent fiscal quarters. This amount represents our consolidated cash rent abatementsdemand for business and deferrals plus our share of the cash rent abatements and deferrals from the unconsolidated joint ventures (calculated based on our ownership percentage) minus our partners’ share of cash rent abatements and deferrals from our consolidated joint ventures (calculated based upon the partners’ percentage ownership interests).
To date, these impacts have not adversely affected our abilityleisure travel returns to fund operating expenses, dividends and distributions, debt service payments, maintenance and repositioning capital expenditures and tenant improvements. Any future material adverse change in the cash provided by our operations may affect our ability to comply with the financial covenants under BPLP’s 2017 Credit Facility or its unsecured senior notes.historical levels.
Our primary uses of capital over the next twelve months will be the completion of our current and committed development and redevelopment projects. Duringprojects, servicing the first quarterprincipal and interest payments on our outstanding indebtedness and satisfying our REIT distribution requirements.
As of September 30, 2021, we utilized our available cash balances and proceeds from BPLP’s issuance of $850 million aggregate principal amount of green bonds to repayhad nine properties under development or redeem an aggregate of approximately $1.6 billion of debt and preferred equity, including the:
redemption of the $850 million aggregate principal amount of BPLP’s 4.125% senior unsecured notes due 2021,
repayment of BPLP’s $500 million unsecured Delayed Draw Facility,
redemption of all $200 million of BXP’s outstanding shares of its Series B Preferred Stock, and
repayment of the mortgage loan collateralized by University Place located in Cambridge, Massachusetts totaling approximately $0.9 million.
We have no debt maturities during the remainder of 2021, other than one loan borrowed by an unconsolidated joint venture of which our share is approximately $87.2 million. We have one loan totaling approximately $610.6 million maturing in 2022 and our unconsolidated joint ventures have two loans maturing in 2022, of which our share is approximately $144.8 million. As of March 31, 2021, ourredevelopment. Our share of the remaining development and redevelopment costs that we expect to fund through 2024 was approximately $1.4 billion, which includes new development and redevelopment starts in$1.1 billion.
During the firstthird quarter of 2021, BPLP completed a public “green bond” offering of $850.0 million of 2.450% unsecured senior notes due October 2033. The offering marked BPLP’s fourth green bond offering and represented the lowest coupon ever issued by BPLP. The net proceeds from the offering along with available cash and borrowings under BPLP’s Revolving Facility were used to fully redeem the $1.0 billion aggregate principal amount of 3.85% unsecured senior notes that were scheduled to mature in February 2023. The early repayment will result in a loss from early extinguishment of debt of approximately $43.9 million in the fourth quarter of 2021. This amount includes approximately $1.0 million of unamortized financing and other costs.
We have a SCP that provides us the opportunity to partner with large institutional investors and capitalize our investment opportunities partially through private equity. The SCP enhances our access to capital and investment capacity and further enhances our returns through fees paid to us, and in certain partnerships, a greater share of income upon achieving certain success criteria. These large financial partners include some of the world’s largest sovereign wealth funds and pension plans. Our use of the SCP is consistent with our ongoing strategy to create value through opportunistic investments in high-quality office properties in markets with the strongest economic growth over time while maintaining a strong balance sheet and modest leverage. As part of the broader SCP, we announced in July 2021 the formation of an aggregate estimatedinvestment program with two large partners committing a targeted equity investment of $1.0 billion, including $250 million from us. Under this agreement, we will provide these partners, for up to two years, exclusive first offers to form joint ventures with us to invest in assets that meet the SCP’s target criteria. All investments are discretionary to each partner.
For example, during the third quarter of 2021, we partnered with two SCP partners to acquire Safeco Plaza, a 50-story, approximately $692.6765,000 net rentable square foot, LEED-Platinum certified, Class A office property located in Seattle, Washington. After mortgage financing, the partners contributed approximately $215 million to fund the majority of which are new lab/life sciences developments and conversions.acquisition. Each partner owns approximately a one-third ownership interest in the property (See Note 5 to the Consolidated Financial Statements).
In addition, during the first quarter, we sold our remaining interestexpect to acquire 360 Park Avenue South, located in Annapolis Junction Buildings Six and SevenNew York, New York, for a gross salepurchase price of approximately $65.9$300 million generating net proceedsin the fourth quarter of $17.6 million after repayment of our share of the debt. We also have tentative agreements to sell three buildings within our VA95 Business Park in Springfield, Virginia and a three-building suburban portfolio that2021. At closing, we expect, if completed, will totalassume approximately $260$202 million of net proceeds.mortgage debt and issue approximately $98 million of OP Units, with a floor price of $111 per OP Unit. Other than customary closing costs, no cash is required to close the transaction. We are evaluating additional assets sales, which, if completed, could generate aggregate additional net proceedsexpect to fund future investment in excess of $200 million. However, therethis asset through a joint venture with one or more financial partners from the SC Program. There can be no assurance that the dispositionsthis acquisition will be consummated on the terms currently contemplated or at all.
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On October 25, 2021, we completed the sale of our 181, 191 and 201 Spring Street properties, located in Lexington, Massachusetts, for a gross sales price of $191.5 million.
We have no debt maturities during the remainder of 2021. We have one loan maturing in 2022 that has an outstanding principal balance of approximately $618.7 million (of which our share is approximately $340.3 million). The loan is secured by our 601 Lexington Avenue property in New York. Our unconsolidated joint ventures have two loans maturing in 2022, of which our share of outstanding principal is approximately $147.0 million. We are currently in the market to refinance the 601 Lexington Avenue mortgage. Due to the increase in cash flow from this asset, due in part to the redevelopment completed earlier in 2021, we anticipate increasing the principal amount of the mortgage and reducing the interest rate as part of the refinancing. There can be no assurance that this refinancing will be consummated on the terms currently contemplated or at all.
Although the fullcurrent and future impact of COVID-19 on our liquidity and capital resources as well as the duration of such impact, will depend on a wide range of factors, we believe that our access to capital and our strong liquidity, including the approximately $1.5$1.2 billion available under the 20172021 Credit Facility and available cash of approximately $593.2$362.7 million (of which approximately $123.9$122.2 million is attributable to our consolidated joint venture partners), as of May 3,November 2, 2021, is sufficient to fund our remaining capital requirements on existing development and redevelopment projects, repay our maturing indebtedness when due, satisfy our REIT distribution requirements and still allow us to act opportunistically on attractive investment opportunities.
In addition, to further enhance our investment capacity and capital resources, we expect to finalize an agreement with two institutional investors to pursue and co-invest in select office acquisitions. In the aggregate, BXP and its partners would commit $1.0 billion of equity and would have the opportunity to invest in each identified transaction at their discretion. However, there can be no assurance that the agreement or the co-investments contemplated thereby will be consummated on the terms currently contemplated, or at all.
We have not sold any shares under BXP’s $600.0 million “at the market” equity offering program.
We may seek to enhance our liquidity to fund our foreseeable potential development activity, pursue additional attractive investment opportunities and refinance or repay indebtedness. Depending on interest rates and overall conditions in the debt and equity markets, we may decide to access either or both of these markets in advance of the need for the funds. Doing so may result in us carrying additional cash and cash equivalents pending our use of the proceeds, which would increase our net interest expense and be dilutive to our earnings.
REIT Tax Distribution Considerations
Dividend
BXP as a REIT is subject to a number of organizational and operational requirements, including a requirement that BXP currently distribute at least 90% of its annual taxable income (excluding capital gains and with certain other adjustments). Our policy is for BXP to distribute at least 100% of its taxable income, including capital gains, to avoid paying federal tax. Common and LTIP unitholders of limited partnership interest in BPLP, received the same total distribution per unit.
BXP’s Board of Directors will continue to evaluate BXP’s dividend rate in light of our actual and projected taxable income (including gains on sales), liquidity requirements and other circumstances, including the impact of COVID-19, and there can be no assurance that the future dividends declared by BXP’s Board of Directors will not differ materially from the current quarterly dividend amount.
Sales
To the extent that we sell assets at a gain and cannot efficiently use the proceeds in a tax deferred manner for either our development activities or attractive acquisitions, BXP would, at the appropriate time, decide whether it is better to declare a special dividend, adopt a stock repurchase program, reduce indebtedness or retain the cash for future investment opportunities. Such a decision will depend on many factors including, among others, the timing, availability and terms of development and acquisition opportunities, our then-current and anticipated leverage, the cost and availability of capital from other sources, the price of BXP’s common stock and REIT distribution requirements. At a minimum, we expect that BXP would distribute at least that amount of proceeds necessary for BXP to avoid paying corporate level tax on the applicable gains realized from any asset sales.
From time to time in selectedselect cases, whether due to a change in use, structuring issues to comply with applicable REIT regulations or other reasons, we may sell an asset that is held by a taxable REIT subsidiary (“TRS”). Such a sale by a TRS would be subject to federal and local taxes.
Cash Flow Summary
The following summary discussion of our cash flows is based on the Consolidated Statements of Cash Flows and is not meant to be an all-inclusive discussion of the changes in our cash flows for the periods presented below.
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Cash and cash equivalents and cash held in escrows aggregated approximately $0.9$1.1 billion and $0.9$1.8 billion at March 31,September 30, 2021 and 2020, respectively, representing an increasea decrease of approximately $0.1$0.7 billion. The following table sets forth changes in cash flows:
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Three months ended March 31, Nine months ended September 30,
20212020Increase (Decrease)20212020Increase (Decrease)
(in thousands)(in thousands)
Net cash provided by operating activitiesNet cash provided by operating activities$152,063 $175,197 $(23,134)Net cash provided by operating activities$786,859 $782,423 $4,436 
Net cash used in investing activitiesNet cash used in investing activities(242,273)(73,793)(168,480)Net cash used in investing activities(998,368)(388,411)(609,957)
Net cash provided by (used in) financing activitiesNet cash provided by (used in) financing activities(679,936)65,288 (745,224)Net cash provided by (used in) financing activities(425,899)678,891 (1,104,790)
Our principal source of cash flow is related to the operation of our properties. The weighted-average term of our in-place leases, excluding residential units, was approximately 7.67.5 years as of March 31,September 30, 2021, including leases signed by our unconsolidated joint ventures, with occupancy rates historically in the range of 88% to 94%. Generally, our properties generate a relatively consistent stream of cash flow that provides us with resources to pay operating expenses, debt service and fund regular quarterly dividend and distribution payment requirements. In addition, over the past several years, we have raised capital through the sale of some of our properties and through secured and unsecured borrowings.
The full extent of the impact of COVID-19 on our business, operations and financial results will depend on numerous evolving factors that we may not be able to accurately predict. In addition, we cannot predict the impact that COVID-19 will have on our tenants, employees, contractors, lenders, suppliers, vendors and joint venture partners; any material adverse effect on these parties could also have a material adverse effect on us.
For the three months ended March 31, 2021, our total dividend and distribution payments were approximately $171.6 million, which exceeded our cash flow from operating activities by approximately $19.5 million. We funded the dividend and distribution payments using cash flow from operating activities, approximately $17.6 million of proceeds from sale of investment in unconsolidated joint ventures and cash on hand.
Cash is used in investing activities to fund acquisitions, development, net investments in unconsolidated joint ventures and maintenance and repositioning capital expenditures. We selectively invest in new projects that enable us to take advantage of our development, leasing, financing and property management skills and invest in existing buildings to enhance or maintain theirour market position. Cash used in investing activities for the threenine months ended March 31,September 30, 2021 consisted primarily of acquisitions of real estate, development projects, building and tenant improvements and capital contributions to unconsolidated joint ventures, partially offset by proceeds from sale of investment in unconsolidated joint ventures. Cash used in investing activities for the threenine months ended March 31,September 30, 2020 consisted primarily of acquisitions of real estate, development projects, building and tenant improvements and capital contributions to unconsolidated joint ventures, partially offset by the proceeds from the sale of real estate and capital distribution from unconsolidated joint ventures, as detailed below:
 Three months ended March 31,
 20212020
 (in thousands)
Construction in progress (1)$(119,496)$(143,160)
Building and other capital improvements(32,717)(39,154)
Tenant improvements(93,201)(64,172)
Proceeds from sales of real estate (2)— 259,489 
Capital contributions to unconsolidated joint ventures (3)(16,684)(89,997)
Capital distributions from unconsolidated joint ventures122 — 
Proceeds from sale of investment in unconsolidated joint venture (4)17,589 — 
Investments in securities, net2,114 3,201 
Net cash used in investing activities$(242,273)$(73,793)
 Nine months ended September 30,
 20212020
 (in thousands)
Acquisitions of real estate (1)$(218,679)$(135,698)
Construction in progress (2)(381,104)(358,824)
Building and other capital improvements(103,840)(116,894)
Tenant improvements(218,878)(172,401)
Proceeds from sales of real estate (3)— 505,679 
Capital contributions to unconsolidated joint ventures (4)(95,462)(158,374)
Capital distributions from unconsolidated joint ventures (5)122 55,123 
Proceeds from sale of investment in unconsolidated joint venture (6)17,789 — 
Issuance of note receivable, net (7)— (9,800)
Investments in securities, net1,684 2,778 
Net cash used in investing activities$(998,368)$(388,411)
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Cash used in investing activities changed primarily due to the following:
(1)On August 2, 2021, we acquired Shady Grove Bio+Tech Campus in Rockville, Maryland, for a purchase price, including transaction costs, of approximately $118.5 million in cash. Shady Grove Bio+Tech Campus is an approximately 435,000 net rentable square foot, seven-building office park situated on an approximately 31-acre site.
On June 2, 2021, we acquired 153 & 211 Second Avenue located in Waltham, Massachusetts for a         purchase price of approximately $100.2 million in cash. 153 & 211 Second Avenue consists of two life sciences lab buildings totaling approximately 137,000 net rentable square feet.

(1)On July 31, 2020, we acquired an undivided ownership interest in real property at 759 Harrison Street located in San Francisco, California for a purchase price totaling approximately $2.3 million.
On June 26, 2020, we completed the acquisition of real property at 777 Harrison Street (known as Fourth + Harrison and formerly known as 425 Fourth Street) located in San Francisco, California for a gross purchase price, including entitlements, totaling approximately $140.1 million. Fourth + Harrison is expected to support the development of approximately 804,000 square feet of primarily commercial office space.
(2)Construction in progress for the threenine months ended March 31,September 30, 2021 includes ongoing expenditures associated with One Five Nine East 53rd Street, which was completed and fully placed in-service during the threenine months ended March 31,September 30, 2021. In addition, we incurred costs associated with our continued development/redevelopment of 200 West Street, 325 Main Street, 2100 Pennsylvania Avenue, Reston Next, 180 CityPoint, View Boston Observatory at The Prudential Center Observatory and 880 Winter Street.
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Construction in progress for the threenine months ended March 31,September 30, 2020 includes ongoing expenditures associated with 17Fifty Presidents Street, 20 CityPoint and The Skylyne, which was completed andwere partially or fully placed in-service during the threenine months ended March 31, 2020 and 20 CityPoint, which was partially placed in-service during the year ended December 31, 2019.September 30, 2020. In addition, we incurred costs associated with our continued development/redevelopment ofof One Five Nine East 53rd Street, Reston Next, 2100 Pennsylvania Avenue, 200 West Street The Skylyne and 325 Main Street.
(2)(3)On June 25, 2020, we completed the sale of a portion of our Capital Gallery property located in Washington, DC for a gross sales price of approximately $253.7 million. Net cash proceeds totaled approximately $246.6 million, resulting in a gain on sale of real estate totaling approximately $203.6 million for BXP and approximately $207.0 million for BPLP. Capital Gallery is an approximately 631,000 net rentable square foot Class A office property. The portion sold is comprised of approximately 455,000 net rentable square feet of commercial office space. We continue to own the land, underground parking garage and remaining commercial office and retail space containing approximately 176,000 net rentable square feet at the property.
On February 20, 2020, we completed the sale of New Dominion Technology Park located in Herndon, Virginia for a gross salesales price of $256.0 million. Net cash proceeds totaled approximately $254.0 million, resulting in a gain on sale of real estate totaling approximately $192.3 million for BXP and approximately $197.1 million for BPLP. New Dominion Technology Park is comprised of two Class A office properties aggregating approximately 493,000 net rentable square feet.
(3)(4)Capital contributions to unconsolidated joint ventures for the threenine months ended March 31,September 30, 2021 consisted primarily of cash contributions of approximately $72.6 million and $11.4 million to our Safeco Plaza and Santa Monica Business Park joint venture.ventures, respectively. On September 1, 2021, we entered into a new joint venture for Safeco Plaza located in Seattle, Washington (See Note 5 to the Consolidated Financial Statements).
Capital contributions to unconsolidated joint ventures for the threenine months ended March 31,September 30, 2020 consisted primarily of cash contributions of approximately $64.5$75.0 million, $16.8$39.0 million, $27.2 million and $4.0$7.5 million to our Platform 16, 3 Hudson Boulevard, Beach Cities Media Center and Metropolitan Square joint ventures, respectively.
(4)(5)Capital distributions from unconsolidated joint ventures for the nine months ended September 30, 2020 consisted of cash distributions totaling (1) approximately $22.5 million from our Metropolitan Square joint venture resulting from the excess proceeds from the refinancing of the mortgage loan on the property, (2) approximately $17.9 million from our Annapolis Junction joint venture resulting from available cash and the
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net proceeds from the sale of Annapolis Junction Building Eight and two land parcels after the pay down of the mortgage loan and (3) approximately $14.0 million from our Colorado Center joint venture resulting from the excess proceeds from the mortgage financing on the property that occurred during 2017, which proceeds were released from lender reserves.
(6)On March 30, 2021, we completed the sale of our 50% ownership interest in Annapolis Junction NFM LLC (the “Annapolis Junction Joint Venture”) to the joint venture partner for a gross sales price of $65.9 million. Net cash proceeds to us totaled approximately $17.6$17.8 million after repayment of our share of debt totaling approximately $15.1 million.
(7)Issuance of notes receivable, net consisted of the $10.0 million of financing provided to an affiliate of our partner in the joint venture that owns and is developing 7750 Wisconsin Avenue located in Bethesda, Maryland.The financing bears interest at a fixed rate of 8.00% per annum, compounded monthly, and matures on the defermentfifth anniversary of the date on which the base building of the affiliate of our partner’s hotel property is substantially completed.The loan is collateralized by a $0.2 million payment due frompledge of the purchaser.partner’s equity interest in our joint venture that owns and is developing 7750 Wisconsin Avenue.
Cash used in financing activities for the threenine months ended March 31,September 30, 2021 totaled approximately $679.9$425.9 million. This amount consisted primarily of (1) the redemption of BPLP’s $850.0 million in aggregate principal amount of its 4.125% senior notes due 2021, (2) the repayment of the Delayed Draw Facility under the 2017 Credit Facility, (3) redemption of the Series B Preferred Stock, (4) payment of our regular dividends and distributions to our shareholders and unitholders and (4)(5) distributions to noncontrolling interest holders in property partnership. These decreases were partially offset by the proceeds from the issuance by BPLP of (1) $850.0 million in aggregate principal amount of its 2.550% senior unsecured notes due 2032.2032 and (2) $850.0 million in aggregate principal amount of its 2.450% senior unsecured notes due 2033. Future debt payments are discussed below under the heading “Capitalization—Debt Financing.”
Capitalization
The following table presents Consolidated Market Capitalization and BXP’s Share of Market Capitalization, as well as the corresponding ratios of Consolidated Debt to Consolidated Market Capitalization and BXP’s Share of Debt to BXP’s Share of Market Capitalization (in thousands except for percentages):
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March 31, 2021September 30, 2021
Shares / Units OutstandingCommon Stock EquivalentEquivalent Value (1)Shares / Units OutstandingCommon Stock EquivalentEquivalent Value (1)
Common StockCommon Stock156,074 156,074 $15,804,053 Common Stock156,206 156,206 $16,924,920 
Common Operating Partnership UnitsCommon Operating Partnership Units17,579 17,579 1,780,050 (2)Common Operating Partnership Units17,477 17,477 1,893,633 (2)
Total EquityTotal Equity173,653 $17,584,103 Total Equity173,683 $18,818,553 
Consolidated DebtConsolidated Debt$12,536,264 Consolidated Debt$13,378,350 
Add:Add:Add:
BXP’s share of unconsolidated joint venture debt (3)BXP’s share of unconsolidated joint venture debt (3)1,165,872 BXP’s share of unconsolidated joint venture debt (3)1,289,582 
Subtract:Subtract:Subtract:
Partners’ share of Consolidated Debt (4)Partners’ share of Consolidated Debt (4)(1,193,260)Partners’ share of Consolidated Debt (4)(1,190,479)
BXP’s Share of DebtBXP’s Share of Debt$12,508,876 BXP’s Share of Debt$13,477,453 
Consolidated Market CapitalizationConsolidated Market Capitalization$30,120,367 Consolidated Market Capitalization$32,196,903 
BXP’s Share of Market CapitalizationBXP’s Share of Market Capitalization$30,092,979 BXP’s Share of Market Capitalization$32,296,006 
Consolidated Debt/Consolidated Market CapitalizationConsolidated Debt/Consolidated Market Capitalization41.62 %Consolidated Debt/Consolidated Market Capitalization41.55 %
BXP’s Share of Debt/BXP’s Share of Market CapitalizationBXP’s Share of Debt/BXP’s Share of Market Capitalization41.57 %BXP’s Share of Debt/BXP’s Share of Market Capitalization41.73 %
_______________  
(1)Values are based on the closing price per share of BXP’s Common Stock on the New York Stock Exchange on March 31,September 30, 2021 of $101.26.$108.35.
(2)Includes long-term incentive plan units (including 2012 OPP Units and 2013 - 2018 MYLTIP Units) but excludes MYLTIP Units granted between 2019 and 2021 because the three-year performance period has not ended.
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(3)See page 7192 for additional information.
(4)See page 7091 for additional information.

Consolidated Debt to Consolidated Market Capitalization Ratio is a measure of leverage commonly used by analysts in the REIT sector. We present this measure as a percentage and it is calculated by dividing (A) our consolidated debt by (B) our consolidated market capitalization, which is the market value of our outstanding equity securities plus our consolidated debt. Consolidated market capitalization is the sum of:
(1)     our consolidated debt; plus
(2)     the product of (x) the closing price per share of BXP common stock on March 31,September 30, 2021, as reported by the New York Stock Exchange, multiplied by (y) the sum of:
(i)     the number of outstanding shares of common stock of BXP,
(ii)     the number of outstanding OP Units in BPLP (excluding OP Units held by BXP),
(iii)     the number of OP Units issuable upon conversion of all outstanding LTIP Units, assuming all conditions have been met for the conversion of the LTIP Units, and
(iv)     the number of OP Units issuable upon conversion of 2012 OPP Units, 2013 - 2018 MYLTIP Units that were issued in the form of LTIP Units.
The calculation of consolidated market capitalization does not include LTIP Units issued in the form of MYLTIP Awards unless and until certain performance thresholds are achieved and they are earned. Because their three-year performance periods have not yet ended, 2019 - 2021 MYLTIP Units are not included in this calculation as of March 31,September 30, 2021.
We also present BXP’s Share of Market Capitalization and BXP’s Share of Debt/BXP’s Share of Market Capitalization, which are calculated in the same manner, except that BXP’s Share of Debt is utilized instead of our consolidated debt in both the numerator and the denominator. BXP’s Share of Debt is defined as our consolidated debt plus our share of debt from our unconsolidated joint ventures (calculated based upon our ownership percentage), minus our partners’ share of debt from our consolidated joint ventures (calculated based upon the
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partners’ percentage ownership interests adjusted for basis differentials). Management believes that BXP’s Share of Debt provides useful information to investors regarding our financial condition because it includes our share of debt from unconsolidated joint ventures and excludes our partners’ share of debt from consolidated joint ventures, in each case presented on the same basis. We have several significant joint ventures and presenting various measures of financial condition in this manner can help investors better understand our financial condition and/or results of operations after taking into account our economic interest in these joint ventures.  We caution investors that the ownership percentages used in calculating BXP’s Share of Debt may not completely and accurately depict all of the legal and economic implications of holding an interest in a consolidated or unconsolidated joint venture. For example, in addition to partners’ interests in profits and capital, venture agreements vary in the allocation of rights regarding decision making (both for routine and major decisions), distributions, transferability of interests, financing and guarantees, liquidations and other matters.  Moreover, in some cases we exercise significant influence over, but do not control, the joint venture in which case GAAP requires that we account for the joint venture entity using the equity method of accounting and we do not consolidate it for financial reporting purposes. In other cases, GAAP requires that we consolidate the venture even though our partner(s) own(s) a significant percentage interest.  As a result, management believes that the presentation of BXP’s Share of a financial measure should not be considered a substitute for, and should only be considered with and as a supplement to our financial information presented in accordance with GAAP.
We present these supplemental ratios because our degree of leverage could affect our ability to obtain additional financing for working capital, capital expenditures, acquisitions, development or other general corporate purposes and because different investors and lenders consider one or both of these ratios. Investors should understand that these ratios are, in part, a function of the market price of the common stock of BXP and as such will fluctuate with changes in such price, and they do not necessarily reflect our capacity to incur additional debt to finance our activities or our ability to manage our existing debt obligations. However, for a company like BXP, whose assets are primarily income-producing real estate, these ratios may provide investors with an alternate indication of leverage, so long as they are evaluated along with the ratio of indebtedness to other measures of asset
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value used by financial analysts and other financial ratios, as well as the various components of our outstanding indebtedness.
For a discussion of our unconsolidated joint venture indebtedness, see “Liquidity and Capital Resources—Capitalization—Off-Balance Sheet Arrangements—Joint Venture Indebtedness” within “Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations” and for a discussion of our consolidated joint venture indebtedness see “Liquidity and Capital Resources—Capitalization—Mortgage Notes Payable Net” within “Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations.”
Debt Financing
As of March 31,September 30, 2021, we had approximately $12.5$13.4 billion of outstanding consolidated indebtedness, representing approximately 41.62%41.55% of our Consolidated Market Capitalization as calculated above consisting of approximately (1) $9.6$10.5 billion (net of discount and deferred financing fees) in publicly traded unsecured senior notes having a GAAP weighted-average interest rate of 3.57%3.48% per annum and maturities in 2023 through 2032 (See Note 7 to the Consolidated Financial Statements)2033 and (2) $2.9 billion (net of deferred financing fees) of property-specific mortgage debt having a GAAP weighted-average interest rate of 3.89% per annum and a weighted-average term of 5.14.6 years.
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The table below summarizes the aggregate carrying value of our mortgage notes payable and BPLP’s unsecured senior notes, line of credit and term loan, as well as Consolidated Debt Financing Statistics at March 31,September 30, 2021 and March 31,September 30, 2020.  
March 31,
20212020
 (dollars in thousands)
Debt Summary:
Balance
Fixed rate mortgage notes payable, net$2,904,672 $2,919,157 
Unsecured senior notes, net9,631,592 8,393,009 
Unsecured line of credit— 250,000 
Unsecured term loan, net— 499,058 
Consolidated Debt12,536,264 12,061,224 
Add:
BXP’s share of unconsolidated joint venture debt, net (1)1,165,872 1,027,547 
Subtract:
Partners’ share of consolidated mortgage notes payable, net (2)(1,193,260)(1,198,575)
BXP’s Share of Debt$12,508,876 $11,890,196 
March 31,
20212020
Consolidated Debt Financing Statistics:
Percent of total debt:
Fixed rate100.00 %93.79 %
Variable rate— %6.21 %
Total100.00 %100.00 %
GAAP Weighted-average interest rate at end of period:
Fixed rate3.64 %3.80 %
Variable rate— %2.16 %
Total3.64 %3.70 %
Coupon/Stated Weighted-average interest rate at end of period:
Fixed rate3.54 %3.69 %
Variable rate— %2.07 %
Total3.54 %3.59 %
Weighted-average maturity at end of period (in years):
Fixed rate6.0 5.8 
Variable rate— 2.1 
Total6.0 5.6 
_______________
(1)See page 71 for additional information.
(2)See page 70 for additional information.
Unsecured Credit Facility
On April 24, 2017, BPLP entered into the 2017 Credit Facility. Among other things, the 2017 Credit Facility (1) increased the total commitment of the Revolving Facility from $1.0 billion to $1.5 billion, (2) extended the maturity date from July 26, 2018 to April 24, 2022, (3) reduced the per annum variable interest rates, and (4) added a $500.0 million Delayed Draw Facility that permitted BPLP to draw until the first anniversary of the closing date. Based on BPLP’s current credit rating, (1) the applicable Eurocurrency margins for the Revolving Facility and Delayed Draw Facility are 87.5 basis points and 95 basis points, respectively, and (2) the facility fee on the Revolving Facility commitment is 0.15% per annum.
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September 30,
20212020
 (dollars in thousands)
Debt Summary:
Balance
Fixed rate mortgage notes payable, net$2,898,699 $2,912,494 
Unsecured senior notes, net10,479,651 9,636,397 
Unsecured line of credit— — 
Unsecured term loan, net— 499,270 
Consolidated Debt13,378,350 13,048,161 
Add:
BXP’s share of unconsolidated joint venture debt, net (1)1,289,582 1,114,031 
Subtract:
Partners’ share of consolidated mortgage notes payable, net (2)(1,190,479)(1,195,957)
BXP’s Share of Debt$13,477,453 $12,966,235 
September 30,
20212020
Consolidated Debt Financing Statistics:
Percent of total debt:
Fixed rate100.00 %96.17 %
Variable rate— %3.83 %
Total100.00 %100.00 %
GAAP Weighted-average interest rate at end of period:
Fixed rate3.57 %3.75 %
Variable rate— %1.18 %
Total3.57 %3.65 %
Coupon/Stated Weighted-average interest rate at end of period:
Fixed rate3.47 %3.65 %
Variable rate— %1.09 %
Total3.47 %3.55 %
Weighted-average maturity at end of period (in years):
Fixed rate5.9 5.8 
Variable rate— 1.6 
Total5.9 5.6 
_______________
(1)See page 92 for additional information.
(2)See page 91 for additional information.
Unsecured Credit Facility
On April 24, 2018,March 16, 2021, BPLP exercised its option to drawrepaid $500.0 million, representing all amounts outstanding, on its Delayed Draw Facility. Prior to its repayment on March 16, 2021, the Delayed Draw Facility bore interest atunder the 2017 Credit Facility. We recognized a variable rate equalloss from early extinguishment of debt totaling approximately $0.5 million, related to LIBOR plus 0.95%unamortized financing costs.
On June 15, 2021, BPLPamended and restated the 2017 Credit Facility and entered into the 2021 Credit Facility. The 2021 Credit Facility provides for borrowings of up to $1.5 billion through the Revolving Facility, subject to customary conditions. Among other things, the amendment and restatement (1) extended the maturity date to June 15, 2026, (2) eliminated the $500.0 million Delayed Draw Facility provided under the 2017 Credit Facility, (3) reduced the per annum basedvariable interest rates on BPLP’sborrowings and (4) added a sustainability-linked pricing component. Under the 2021 Credit Facility, BPLP may increase the total commitment by up to $500.0 million by
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increasing the amount of the Revolving Facility and/or by incurring one or more term loans, in each case, subject to syndication of the increase and other conditions (See Note 8 to the Consolidated Financial Statements).
The 2021 Credit Facility replaces the 2017 Credit Facility, which consisted of a $1.5 billion unsecured revolving line of credit rating.and a $500.0 million Delayed Draw Facility, and was scheduled to expire on April 24, 2022.
As of March 31, 2021 and May 3,September 30, 2021, BPLP had no borrowings under its 20172021 Credit Facility and outstanding letters of credit totaling approximately $2.3 million and $6.3 million, respectively, with the ability to borrow approximately $1.5 billionbillion. As of November 2, 2021, BPLP had $310.0 million of borrowings under its 2021 Credit Facility and outstanding letters of credit totaling approximately $6.3 million, with the Revolving Facility.ability to borrow approximately $1.2 billion.
Unsecured Senior Notes
For a description of BPLP’s outstanding unsecured senior notes as of March 31,September 30, 2021, see Note 7 to the Consolidated Financial Statements.
On February 14, 2021, BPLP completed the redemption of $850.0 million in aggregate principal amount of its 4.125% senior notes due May 15, 2021. The redemption price was approximately $858.7 million, which was equal to parthe stated principal plus approximately $8.7 million of accrued and unpaid interest to, but not including, the redemption date. Excluding the accrued and unpaid interest, the redemption price was equal to the principal amount being redeemed. We recognized a loss from early extinguishment of debt totaling approximately $0.4 million, related to unamortized origination costs.
On March 16, 2021, BPLP completed a public offering of $850.0 million in aggregate principal amount of its 2.550% unsecured senior notes due 2032. The notes were priced at 99.570% of the principal amount to yield an effective rate (including financing fees) of approximately 2.671% per annum to maturity. The notes will mature on April 1, 2032, unless earlier redeemed. The aggregate net proceeds from the offering were approximately $839.2 million after deducting underwriting discounts and transaction expenses.
On September 29, 2021, BPLP completed a public offering of $850.0 million in aggregate principal amount of its 2.450% unsecured senior notes due 2033. The notes were priced at 99.959% of the principal amount to yield an effective rate (including financing fees) of approximately 2.524% per annum to maturity. The notes will mature on October 1, 2033, unless earlier redeemed. The aggregate net proceeds from the offering were approximately $842.5 million after deducting underwriting discounts and transaction expenses.
On October 15, 2021, BPLP used available cash and funds under its 2021 Credit Facility to complete the redemption of $1.0 billion in aggregate principal amount of its 3.85% senior notes due February 1, 2023. The redemption price was approximately $1.05 billion, which included approximately $7.9 million of accrued and unpaid interest to, but not including, the redemption date and an early redemption premium and unamortized financing costs totaling approximately $43.9 million.
The indenture relating to the unsecured senior notes contains 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 greater than 1.50, and (4) an unencumbered asset value of not less than 150% of unsecured debt. At March 31,September 30, 2021, BPLP was in compliance with each of these financial restrictions and requirements.
Mortgage Notes Payable
The following represents the outstanding principal balances due under the mortgage notes payable at March 31,September 30, 2021:
PropertiesStated Interest RateGAAP Interest Rate (1)Stated Principal AmountDeferred Financing Costs, NetCarrying Amount
Carrying Amount (Partners Share)
Maturity Date
 (dollars in thousands)
Consolidated Joint Ventures
767 Fifth Avenue (the General Motors Building)3.43 %3.64 %$2,300,000 $(19,857)$2,280,143 $912,128 (2)(3)(4)June 9, 2027
601 Lexington Avenue4.75 %4.79 %618,725 (169)618,556 278,351 (5)April 10, 2022
Total$2,918,725 $(20,026)$2,898,699 $1,190,479 
PropertiesStated
Interest Rate
GAAP
Interest Rate (1)
Stated
Principal Amount
Deferred Financing Costs, NetCarrying Amount
Carrying Amount (Partners Share)
Maturity Date
 (dollars in thousands)
Consolidated Joint Ventures
767 Fifth Avenue (the General Motors Building)3.43 %3.64 %$2,300,000 $(21,605)$2,278,395 $911,435 (2)(3)(4)June 9, 2027
601 Lexington Avenue4.75 %4.79 %626,612 (335)626,277 281,825 (5)April 10, 2022
2,926,612 (21,940)2,904,672 1,193,260 
Total$2,926,612 $(21,940)$2,904,672 $1,193,260 
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_______________ 
(1)GAAP interest rate differs from the stated interest rate due to the inclusion of the amortization of financing charges and the effects of hedging transactions (if any).
(2)The mortgage loan requires interest only payments with a balloon payment due at maturity.
(3)This property is owned by a consolidated entity in which we have a 60% interest. The partners’ share of the carrying amount has been adjusted for basis differentials.
(4)In connection with the refinancing of the loan, we guaranteed the consolidated entity’s obligation to fund various reserves for tenant improvement costs and allowances, leasing commissions and free rent obligations in lieu of cash deposits. As of March 31,September 30, 2021, the maximum funding obligation under the guarantee was approximately $23.1$20.3 million. We earn a fee from the joint venture for providing the guarantee and have an agreement with our partners to reimburse the joint venture for their share of any payments made under the guarantee (See Note 9 to the Consolidated Financial Statements).
(5)This property is owned by a consolidated entity in which we have a 55% interest.
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Off-Balance Sheet Arrangements—Joint Venture Indebtedness
We have investments in unconsolidated joint ventures with our effective ownership interests ranging from 20% to 60%55%. ThirteenFourteen of these ventures have mortgage indebtedness. We exercise significant influence over, but do not control, these entities. As a result, we account for them using the equity method of accounting. See also Note 5 to the Consolidated Financial Statements. At March 31,September 30, 2021, the aggregate carrying amount of debt, including both our and our partners’ share, incurred by these ventures was approximately $2.7$3.0 billion (of which our proportionate share is approximately $1.2$1.3 billion). The table below summarizes the outstanding debt of these joint venture properties at March 31,September 30, 2021. In addition to other guarantees specifically noted in the table, we have agreed to customary environmental indemnifications and nonrecourse carve-outs (e.g., guarantees against fraud, misrepresentation and bankruptcy) as well as the completion of development projects on certain of the loans. 
PropertiesPropertiesNominal % OwnershipStated Interest RateGAAP Interest Rate (1)Stated Principal AmountDeferred Financing Costs, NetCarrying AmountCarrying Amount (Our share) Maturity DatePropertiesNominal % OwnershipStated Interest RateGAAP Interest Rate (1)Stated Principal AmountDeferred Financing Costs, NetCarrying AmountCarrying Amount (Our share) Maturity Date
(dollars in thousands) (dollars in thousands)
Santa Monica Business ParkSanta Monica Business Park55 %4.06 %4.24 %$300,000 $(2,264)$297,736 $163,755 (2)(3)July 19, 2025Santa Monica Business Park55.00 %4.06 %4.24 %$300,000 $(2,003)$297,997 $163,899 (2)(3)July 19, 2025
Market Square NorthMarket Square North50 %2.80 %2.96 %125,000 (951)124,049 62,025 (2)(4)November 10, 2025Market Square North50.00 %2.80 %2.96 %125,000 (848)124,152 62,076 (2)(4)November 10, 2025
1265 Main Street1265 Main Street50 %3.77 %3.84 %37,123 (299)36,824 18,412 January 1, 20321265 Main Street50.00 %3.77 %3.84 %36,694 (285)36,409 18,204 January 1, 2032
Colorado CenterColorado Center50 %3.56 %3.58 %550,000 (653)549,347 274,673 (2)August 9, 2027Colorado Center50.00 %3.56 %3.58 %550,000 (602)549,398 274,699 (2)August 9, 2027
Dock 72Dock 7250 %3.10 %3.32 %196,412 (1,478)194,934 97,467 (2)(5)December 18, 2023Dock 7250.00 %3.10 %3.32 %196,412 (1,178)195,234 97,617 (2)(5)December 18, 2023
The Hub on Causeway - PodiumThe Hub on Causeway - Podium50 %2.36 %2.86 %174,329 (433)173,896 86,948 (2)(6)September 6, 2021The Hub on Causeway - Podium50.00 %2.34 %2.50 %174,329 (561)173,768 86,884 (2)(6)September 6, 2023
Hub50HouseHub50House50 %2.12 %2.40 %174,352 (552)173,800 86,900 (2)(7)April 19, 2022Hub50House50.00 %2.08 %2.37 %176,468 (297)176,171 88,085 (2)(7)April 19, 2022
100 Causeway Street100 Causeway Street50 %1.63 %1.84 %250,612 (2,048)248,564 124,282 (2)(8)September 5, 2023100 Causeway Street50.00 %1.59 %1.81 %297,206 (1,624)295,582 147,791 (2)(8)September 5, 2023
7750 Wisconsin Avenue (Marriott International Headquarters)7750 Wisconsin Avenue (Marriott International Headquarters)50 %1.37 %1.91 %180,459 (2,901)177,558 88,779 (2)(9)April 26, 20237750 Wisconsin Avenue (Marriott International Headquarters)50.00 %1.34 %1.88 %208,071 (2,204)205,867 102,933 (2)(9)April 26, 2023
Safeco PlazaSafeco Plaza33.67 %2.35 %2.50 %250,000 (1,798)248,202 83,570 (2)(10)September 1, 2026
500 North Capitol Street, NW500 North Capitol Street, NW30 %4.15 %4.20 %105,000 (128)104,872 31,462 (2)June 6, 2023500 North Capitol Street, NW30.00 %4.15 %4.20 %105,000 (99)104,901 31,470 (2)June 6, 2023
901 New York Avenue901 New York Avenue25 %3.61 %3.69 %220,041 (670)219,371 54,843   January 5, 2025901 New York Avenue25.00 %3.61 %3.69 %217,851 (581)217,270 54,318   January 5, 2025
3 Hudson Boulevard3 Hudson Boulevard25 %3.62 %3.70 %80,000 (144)79,856 19,964 (2)(10)July 13, 20233 Hudson Boulevard25.00 %3.59 %3.67 %80,000 (112)79,888 19,972 (2)(11)July 13, 2023
Metropolitan SquareMetropolitan Square20 %5.40 %6.90 %288,000 (6,191)281,809 56,362 (2)(11)July 7, 2022Metropolitan Square20.00 %5.40 %6.90 %294,073 (3,751)290,322 58,064 (2)(12)July 7, 2022
TotalTotal$2,681,328 $(18,712)$2,662,616 $1,165,872   Total$3,011,104 $(15,943)$2,995,161 $1,289,582   
_______________
(1)GAAP interest rate differs from the stated interest rate due to the inclusion of the amortization of financing charges, which includes mortgage recording fees.
(2)The loan requires interest only payments with a balloon payment due at maturity.
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(3)The loan bears interest at a variable rate equal to LIBOR plus 1.28% per annum and matures on July 19, 2025. A subsidiary of the joint venture entered into interest rate swap contracts with notional amounts aggregating $300.0 million through April 1, 2025, resulting in a fixed rate of approximately 4.063% per annum through the expiration of the interest rate swap contracts.
(4)The loan bears interest at a variable rate equal to (1) the greater of (x) LIBOR or (y) 0.50%, plus (2) 2.30% per annum and matures on November 10, 2025, with one, one-year extension option, subject to certain conditions.
(5)The construction financing has a borrowing capacity of $250.0 million. The construction financing bears interest at a variable rate equal to (1) the greater of (x) LIBOR or (y) 0.25%, plus (2) 2.85% per annum and matures on December 18, 2023.
(6)The construction financing had a borrowing capacity of $204.6 million. On September 16, 2019, the joint venture paid down the construction loan principal balance in the amount of approximately $28.8 million, reducing the borrowing capacity to $175.8 million. The construction financing bears interest at a variable rate equal to LIBOR plus 2.25% per annum and matures on September 6, 2021, with two, one-year extension options, subject to certain conditions.2023.
(7)The construction financing has a borrowing capacity of $180.0 million. The construction financing bears interest at a variable rate equal to LIBOR plus 2.00% per annum and matures on April 19, 2022, with two, one-year extension options, subject to certain conditions.
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(8)The construction financing has a borrowing capacity of $400.0 million. The construction financing bears interest at a variable rate equal to LIBOR plus 1.50% per annum (LIBOR plus 1.375% per annum upon stabilization, as defined in the loan agreement) and matures on September 5, 2023, with two, one-year extension options, subject to certain conditions.
(9)The construction financing has a borrowing capacity of $255.0 million. The construction financing bears interest at a variable rate equal to LIBOR plus 1.25% per annum and matures on April 26, 2023, with two, one-year extension options, subject to certain conditions.
(10)The loan bears interest at a variable rate equal to the greater of (x) 2.35% or (y) LIBOR plus 2.20% per annum and matures on September 1, 2026.
(11)We provided $80.0 million of mortgage financing to the joint venture. The loan bears interest at a variable rate equal to LIBOR plus 3.50% per annum and matures on July 13, 2023, with extension options, subject to certain conditions. The loan has been reflected as Related Party Note Receivable, Net on our Consolidated Balance Sheets. As of September 30, 2021, the loan has approximately $13.1 million of accrued interest due at the maturity date.
(11)(12)The loan bears interest at a variable rate equal to (1) the greater of (x) LIBOR or (y) 0.65%, plus (2) 4.75% per annum and matures on July 7, 2022 with two, one-year extension options, subject to certain conditions. The joint venture entered into an interest rate cap agreement with a financial institution to limit its exposure to increases in the LIBOR rate at a cap of 3.00% per annum on a notional amount of $325.0 million through July 7, 2022.
State and Local Tax Matters 
Because BXP is organized and qualifies as a REIT, it is generally not subject to federal income taxes, but is subject to certain state and local taxes. In the normal course of business, certain entities through which we own real estate either have undergone, or are currently undergoing, tax audits or other inquiries. Although we believe that we have substantial arguments in favor of our position in the ongoing audits, in some instances there is no controlling precedent or interpretive guidance on the specific point at issue. Collectively, tax deficiency notices received to date from the jurisdictions conducting the ongoing audits have not been material. However, there can be no assurance that future audits will not occur with increased frequency or that the ultimate result of such audits will not have a material adverse effect on our results of operations. 
Insurance
For information concerning our insurance program, see Note 9 to the Consolidated Financial Statements.
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,” for each of BXP and BPLP by adjusting net income (loss) attributable to Boston Properties, Inc. common shareholders and net income (loss) attributable to Boston Properties Limited Partnership common unitholders (computed in accordance with GAAP), respectively, for gains (or losses) from sales of properties, impairment losses on depreciable real estate consolidated on our balance sheet, impairment losses on our investments in unconsolidated joint ventures driven by a measurable decrease in the fair value of depreciable real estate held by the unconsolidated joint ventures and our share of real estate-related depreciation and amortization. FFO is a non-GAAP financial measure. We believe the presentation of FFO, combined with the presentation of required GAAP financial measures, improves the understanding of operating results of REITs among the investing public and helps make comparisons
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of REIT operating results more meaningful. Management generally considers FFO to be useful measures for understanding and comparing our operating results because, by excluding gains and losses related to sales of previously depreciated operating real estate assets, impairment losses and real estate asset depreciation and amortization (which can differ across owners of similar assets in similar condition based on historical cost accounting and useful life estimates), FFO can help investors compare the operating performance of a company’s real estate across reporting periods and to the operating performance of other companies.
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. We believe that in order to facilitate a clear understanding of our operating results, FFO should be examined in conjunction with net income attributable to Boston Properties, Inc. common shareholders and net income attributable to Boston Properties Limited Partnership as presented in our Consolidated Financial Statements. FFO should not be considered as a substitute for net income attributable to Boston Properties, Inc. common shareholders or net income attributable to Boston Properties Limited Partnership common unitholders (determined in accordance with GAAP) or any other GAAP financial measures and should only be considered together with and as a supplement to our financial information prepared in accordance with GAAP.  
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The impact that COVID-19 has had on our business, financial position and results of operations during the first quarter of 2021 is discussed throughout this report. The full extent of the impact of COVID-19 on our business, operations and financial results will depend on numerous evolving factors that we may not be able to accurately predict. The impact of COVID-19 on our revenue, in particular lease, parking and hotel revenue was negatively impacted by COVID-19 for the three months ended March 31, 2021, thus negatively impacting our FFO. These decreases are discussed under the heading “Comparison of the three months ended March 31, 2021 to the three months ended March 31, 2020” within “Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations.”
Boston Properties, Inc.
The following table presents a reconciliation of net income attributable to Boston Properties, Inc. common shareholders to FFO attributable to Boston Properties, Inc. common shareholders for the three months ended March 31,September 30, 2021 and 2020:
Three months ended March 31, Three months ended September 30,
2021202020212020
(in thousands)(in thousands)
Net income attributable to Boston Properties, Inc. common shareholdersNet income attributable to Boston Properties, Inc. common shareholders$91,624 $497,496 Net income attributable to Boston Properties, Inc. common shareholders$108,297 $89,854 
Add:Add:Add:
Preferred stock redemption charge6,412 — 
Preferred dividendsPreferred dividends2,560 2,625 Preferred dividends— 2,625 
Noncontrolling interest—common units of the Operating PartnershipNoncontrolling interest—common units of the Operating Partnership11,084 57,539 Noncontrolling interest—common units of the Operating Partnership11,982 10,020 
Noncontrolling interests in property partnershipsNoncontrolling interests in property partnerships16,467 19,486 Noncontrolling interests in property partnerships18,971 15,561 
Net incomeNet income128,147 577,146 Net income139,250 118,060 
Add:Add:Add:
Depreciation and amortizationDepreciation and amortization176,565 171,094 Depreciation and amortization179,412 166,456 
Noncontrolling interests in property partnerships’ share of depreciation and amortizationNoncontrolling interests in property partnerships’ share of depreciation and amortization(16,457)(17,627)Noncontrolling interests in property partnerships’ share of depreciation and amortization(16,773)(15,833)
BXP’s share of depreciation and amortization from unconsolidated joint venturesBXP’s share of depreciation and amortization from unconsolidated joint ventures18,412 18,332 BXP’s share of depreciation and amortization from unconsolidated joint ventures17,803 20,413 
Corporate-related depreciation and amortizationCorporate-related depreciation and amortization(440)(469)Corporate-related depreciation and amortization(443)(444)
Less:Less:Less:
Gain on sale of investment included within income (loss) from unconsolidated joint ventures10,257 — 
Gains on sales of real estate— 410,165 
Gains (losses) on sales of real estateGains (losses) on sales of real estate348 (209)
Noncontrolling interests in property partnershipsNoncontrolling interests in property partnerships16,467 19,486 Noncontrolling interests in property partnerships18,971 15,561 
Preferred dividendsPreferred dividends— 2,625 
Preferred dividends2,560 2,625 
Preferred stock redemption charge6,412 — 
Funds from Operations (FFO) attributable to the Operating Partnership common unitholders (including Boston Properties, Inc.)Funds from Operations (FFO) attributable to the Operating Partnership common unitholders (including Boston Properties, Inc.)270,531 316,200 Funds from Operations (FFO) attributable to the Operating Partnership common unitholders (including Boston Properties, Inc.)299,930 270,675 
Less:Less:Less:
Noncontrolling interest—common units of the Operating Partnership’s share of funds from operationsNoncontrolling interest—common units of the Operating Partnership’s share of funds from operations26,728 32,138 Noncontrolling interest—common units of the Operating Partnership’s share of funds from operations29,453 26,697 
Funds from Operations attributable to Boston Properties, Inc. common shareholdersFunds from Operations attributable to Boston Properties, Inc. common shareholders$243,803 $284,062 Funds from Operations attributable to Boston Properties, Inc. common shareholders$270,477 $243,978 
Our percentage share of Funds from Operations—basicOur percentage share of Funds from Operations—basic90.12 %89.84 %Our percentage share of Funds from Operations—basic90.18 %90.14 %
Weighted average shares outstanding—basicWeighted average shares outstanding—basic155,928 155,011 Weighted average shares outstanding—basic156,183 155,645 
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Reconciliation to Diluted Funds from Operations: 
Three months ended March 31, Three months ended September 30,
20212020 20212020
Income
(Numerator)
Shares/Units
(Denominator)
Income
(Numerator)
Shares/Units
(Denominator)
Income
(Numerator)
Shares/Units
(Denominator)
Income
(Numerator)
Shares/Units
(Denominator)
(in thousands)(in thousands)
Basic Funds from OperationsBasic Funds from Operations$270,531 173,018 $316,200 172,549 Basic Funds from Operations$299,930 173,194 $270,675 172,677 
Effect of Dilutive Securities:Effect of Dilutive Securities:Effect of Dilutive Securities:
Stock based compensationStock based compensation— 171 — 247 Stock based compensation— 415 — 25 
Diluted Funds from OperationsDiluted Funds from Operations$270,531 173,189 $316,200 172,796 Diluted Funds from Operations$299,930 173,609 $270,675 172,702 
Less:Less:Less:
Noncontrolling interest—common units of the Operating Partnership’s share of diluted Funds from OperationsNoncontrolling interest—common units of the Operating Partnership’s share of diluted Funds from Operations26,693 17,090 32,092 17,538 Noncontrolling interest—common units of the Operating Partnership’s share of diluted Funds from Operations29,393 17,011 26,693 17,032 
Diluted Funds from Operations attributable to Boston Properties, Inc. (1)Diluted Funds from Operations attributable to Boston Properties, Inc. (1)$243,838 156,099 $284,108 155,258 Diluted Funds from Operations attributable to Boston Properties, Inc. (1)$270,537 156,598 $243,982 155,670 
 _______________
(1)BXP’s share of diluted Funds from Operations was 90.13%90.20% and 89.95%90.14% for the three months ended March 31,September 30, 2021 and 2020, respectively.

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Boston Properties Limited Partnership
The following table presents a reconciliation of net income attributable to Boston Properties Limited Partnership common unitholders to FFO attributable to Boston Properties Limited Partnership common unitholders for the three months ended March 31,September 30, 2021 and 2020:
Three months ended March 31, Three months ended September 30,
20212020 20212020
(in thousands) (in thousands)
Net income attributable to Boston Properties Limited Partnership common unitholdersNet income attributable to Boston Properties Limited Partnership common unitholders$105,773 $566,333 Net income attributable to Boston Properties Limited Partnership common unitholders$122,014 $101,624 
Add:Add:Add:
Preferred unit redemption charge6,412 — 
Preferred distributionsPreferred distributions2,560 2,625 Preferred distributions— 2,625 
Noncontrolling interests in property partnershipsNoncontrolling interests in property partnerships16,467 19,486 Noncontrolling interests in property partnerships18,971 15,561 
Net incomeNet income131,212 588,444 Net income140,985 119,810 
Add:Add:Add:
Depreciation and amortizationDepreciation and amortization173,500 169,285 Depreciation and amortization177,677 164,706 
Noncontrolling interests in property partnerships’ share of depreciation and amortizationNoncontrolling interests in property partnerships’ share of depreciation and amortization(16,457)(17,627)Noncontrolling interests in property partnerships’ share of depreciation and amortization(16,773)(15,833)
BXP’s share of depreciation and amortization from unconsolidated joint venturesBXP’s share of depreciation and amortization from unconsolidated joint ventures18,412 18,332 BXP’s share of depreciation and amortization from unconsolidated joint ventures17,803 20,413 
Corporate-related depreciation and amortizationCorporate-related depreciation and amortization(440)(469)Corporate-related depreciation and amortization(443)(444)
Less:Less:Less:
Gain on sale of investment included within (loss) income from unconsolidated joint ventures10,257 — 
Gains on sales of real estate— 419,654 
Gains (losses) on sales of real estateGains (losses) on sales of real estate348 (209)
Noncontrolling interests in property partnershipsNoncontrolling interests in property partnerships16,467 19,486 Noncontrolling interests in property partnerships18,971 15,561 
Preferred distributionsPreferred distributions2,560 2,625 Preferred distributions— 2,625 
Preferred unit redemption charge6,412 — 
Funds from Operations attributable to Boston Properties Limited Partnership common unitholders (1)Funds from Operations attributable to Boston Properties Limited Partnership common unitholders (1)$270,531 $316,200 Funds from Operations attributable to Boston Properties Limited Partnership common unitholders (1)$299,930 $270,675 
Weighted average shares outstanding—basicWeighted average shares outstanding—basic173,018 172,549 Weighted average shares outstanding—basic173,194 172,677 
 _______________
(1)Our calculation includes OP Units and vested LTIP Units (including vested 2012 OPP Units and vested 2013 - 2018 MYLTIP Units).
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Reconciliation to Diluted Funds from Operations: 
 Three months ended March 31,
 20212020
(in thousands)
 Income
(Numerator)
Shares/Units
(Denominator)
Income
(Numerator)
Shares/Units
(Denominator)
Basic Funds from Operations$270,531 173,018 $316,200 172,549 
Effect of Dilutive Securities:
Stock based compensation— 171 — 247 
Diluted Funds from Operations$270,531 173,189 $316,200 172,796 

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 Three months ended September 30,
 20212020
(in thousands)
 Income
(Numerator)
Shares/Units
(Denominator)
Income
(Numerator)
Shares/Units
(Denominator)
Basic Funds from Operations$299,930 173,194 $270,675 172,677 
Effect of Dilutive Securities:
Stock based compensation— 415 — 25 
Diluted Funds from Operations$299,930 173,609 $270,675 172,702 
Contractual Obligations
We have various service contracts with vendors related to our property management. In addition, we have certain other contracts we enter into in the ordinary course of business that may extend beyond one year. These contracts include terms that provide for cancellation with insignificant or no cancellation penalties. Contract terms are generally between three and five years.
During the three months ended March 31,September 30, 2021, we paid approximately $109.8$67.8 million to fund tenant-related obligations, including tenant improvements and leasing commissions.
In addition, during the three months ended March 31,September 30, 2021, we and our unconsolidated joint venture partners incurred approximately $53$102.9 million of new tenant-related obligations associated with approximately 588,0001.4 million square feet which included approximately 67,000 square feet of lease modifications related to COVID-19, of second generation leases, or approximately $91$73 per square foot. We signed approximately 4,000 square feet of
did not sign any first generation leases.leases during the three months ended September 30, 2021. The tenant-related obligations for the development properties are included within the projects’ “Estimated Total Investment” referred to in “Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources.” In aggregate during the first quarter of 2021, we signed leases for approximately 592,000 square feet of space and incurred aggregate tenant-related obligations of approximately $54 million, or approximately $91 per square foot.


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ITEM 3—Quantitative and Qualitative Disclosures about Market Risk.
The following table presents the aggregate carrying value of our mortgage notes payable, net, unsecured senior notes, net, unsecured line of credit and our corresponding estimate of fair value as of March 31,September 30, 2021. As of March 31,September 30, 2021, all of these borrowings bore 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 debt obligations with corresponding weighted-average interest rates sorted by maturity date.
The table below does not include our unconsolidated joint venture debt. For a discussion concerning our unconsolidated joint venture debt, see Note 5 to the Consolidated Financial Statements and “Item 2Management’s Discussion and Analysis of Financial Condition and Results of Operations—Capitalization—Off-Balance Sheet Arrangements—Joint Venture Indebtedness.
202120222023202420252026+TotalEstimated
Fair Value
202120222023202420252026+TotalEstimated Fair Value
(dollars in thousands)
Mortgage debt, net
(dollars in thousands)
Mortgage debt, net
Fixed RateFixed Rate$9,031 $611,132 $(3,494)$(3,494)$(3,494)$2,294,991 $2,904,672 $3,025,986 Fixed Rate$3,058 $611,132 $(3,494)$(3,494)$(3,494)$2,294,991 $2,898,699 $3,032,122 
GAAP Average Interest RateGAAP Average Interest Rate4.79 %4.79 %— %— %— %3.64 %3.89 %GAAP Average Interest Rate4.79 %4.79 %— %— %— %3.64 %3.89 %
Variable RateVariable Rate— — — — — — — — Variable Rate— — — — — — — — 
Unsecured debt, net Unsecured debt, net
Fixed RateFixed Rate$(8,282)$(11,132)$1,489,937 $691,202 $842,472 $6,627,395 $9,631,592 $10,216,659 Fixed Rate$(2,920)$(11,746)$1,489,323 $690,587 $841,857 $7,472,550 $10,479,651 $11,157,602 
GAAP Average Interest RateGAAP Average Interest Rate— %— %3.73 %3.92 %3.35 %3.52 %3.57 %GAAP Average Interest Rate— %— %3.73 %3.92 %3.35 %3.41 %3.48 %
Variable RateVariable Rate— — — — — — — — Variable Rate— — — — — — — — 
Total DebtTotal Debt$749 $600,000 $1,486,443 $687,708 $838,978 $8,922,386 $12,536,264 $13,242,645 Total Debt$138 $599,386 $1,485,829 $687,093 $838,363 $9,767,541 $13,378,350 $14,189,724 

At March 31,September 30, 2021, the weighted-average coupon/stated rates on the fixed rate debt stated above was 3.54%3.47% per annum.
The fair value amounts were determined solely by considering the impact of hypothetical interest rates on our financial instruments. 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.
On March 5, 2021, the Financial Conduct Authority (“FCA”) announced that USD LIBOR will no longer be published after June 30, 2023. This announcement has several implications, including setting the spread that may be used to automatically convert contracts from LIBOR to the Secured Overnight Financing Rate (“SOFR”). Additionally, banking regulators are encouraging banks to discontinue new LIBOR debt issuances by December 31, 2021.
We anticipate that LIBOR will continue to be available at least until June 30, 2023. Any changes adopted by the FCA or other governing bodies in the method used for determining LIBOR may result in a sudden or prolonged increase or decrease in reported LIBOR. If that were to occur, our interest payments could change. In addition, uncertainty about the extent and manner of future changes may result in interest rates and/or payments that are higher or lower than if LIBOR were to remain available in its current form.
We and our unconsolidated joint ventures have contracts that are indexed to LIBOR and we are monitoring and evaluating the related risks. These risks arise in connection with transitioning contracts to an alternative rate, including any resulting value transfer that may occur, and are likely to vary by contract. The value of loans, securities, or derivative instruments tied to LIBOR, as well as interest rates on our or our unconsolidated joint ventures current or future indebtedness, may also be impacted if LIBOR is limited or discontinued. For some instruments the method of transitioning to an alternative reference rate may be challenging, especially if we cannot agree with the respective counterparty about how to make the transition.
While we expect LIBOR to be available in substantially its current form until at least the end of June 30, 2023, it is possible that LIBOR will become unavailable prior to that point. This event could result, for example, if sufficient banks decline to make submissions to the LIBOR administrator. In that case, the risks associated with the transition to an alternative reference rate will be accelerated and magnified.
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Alternative rates and other market changes related to the replacement of LIBOR, including the introduction of financial products and changes in market practices, may lead to risk modeling and valuation challenges, such as adjusting interest rate accrual calculations and building a term structure for an alternative rate.
The introduction of an alternative rate also may create additional basis risk and increased volatility as alternative rates are phased in and utilized in parallel with LIBOR.
Adjustments to systems and mathematical models to properly process and account for alternative rates will be required, which may strain the model risk management and information technology functions and result in substantial incremental costs for us.
ITEM 4—Controls and Procedures.
Boston Properties, Inc.
(a) Evaluation of Disclosure Controls and Procedures. As of the end of the period covered by this report, our management, with the participation of Boston Properties, Inc.’s Chief Executive Officer (Principal Executive Officer) and Chief Financial Officer (Principal Financial Officer), evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended). Based upon that evaluation, Boston Properties, Inc.’s Chief Executive Officer and Chief Financial Officer concluded that these disclosure controls and procedures were effective as of the end of the period covered by this report.
(b) Changes in Internal Control Over Financial Reporting. No change in Boston Properties, Inc.’s internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934, as amended) occurred during the firstthird quarter of our fiscal year ending December 31, 2021 that has materially affected, or is reasonably likely to materially affect, Boston Properties, Inc.’s internal control over financial reporting.
Boston Properties Limited Partnership
(a) Evaluation of Disclosure Controls and Procedures. As of the end of the period covered by this report, the management of Boston Properties, Inc., the sole general partner of Boston Properties Limited Partnership, with the participation of its Chief Executive Officer (Principal Executive Officer) and Chief Financial Officer (Principal Financial Officer), evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended). Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer of Boston Properties, Inc. concluded that these disclosure controls and procedures were effective as of the end of the period covered by this report.
(b) Changes in Internal Control Over Financial Reporting. No change in its internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934, as amended) occurred during the firstthird quarter of our fiscal year ending December 31, 2021 that has materially affected, or is reasonably likely to materially affect, its internal control over financial reporting.

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PART II. OTHER INFORMATION
ITEM 1—Legal Proceedings.
We are subject to 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 our financial position, results of operations or liquidity.
ITEM 1A—Risk Factors.
Except to the extent updated below or to the extent additional factual information disclosed elsewhere in thesethis Quarterly ReportsReport on Form 10-Q relates to such risk factors (including, without limitation, the matters discussed in Part I, “Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations”), there were no material changes to the risk factors disclosed in Part I, “Item 1A. Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2020.
Our use of joint ventures and participation in a co-investment program may limit our flexibility with jointly owned investments and other assets we may wish to acquire.
In appropriate circumstances, we intend to acquire and recapitalize or develop, as applicable, properties in joint ventures with other persons or entities. We currently have joint ventures that are and are not consolidated within our financial statements. Our participation in joint ventures subjects us to risks, including but not limited to, the following risks that:
our joint venture partners may have different objectives than we have regarding the appropriate timing and terms of any sale or refinancing of a property, its operation or, if applicable, the commencement of development activities, and we could become engaged in a dispute with any of our joint venture partners that could lead to the sale of either parties’ ownership interest or the property;
some of our joint ventures are subject to debt and, depending on credit market conditions, the refinancing of such debt may require equity capital calls;
our joint venture partners may be structured differently than us for tax purposes and this could create conflicts of interest, including with respect to our compliance with the REIT requirements, and our REIT status could be jeopardized if any of our joint ventures do not operate in compliance with REIT requirements;
our joint venture partners may have competing interests in our markets that could create conflicts of interest;
our joint venture partners may default on their obligations, which could necessitate that we fulfill their obligation ourselves;
our joint ventures may be unable to repay any amounts that we may loan to them;
our joint venture agreements may contain provisions limiting the liquidity of our interest for sale or sale of the entire asset;
our subsidiaries that would be the general partner or managing member of the joint ventures could be generally liable, under applicable law or the governing agreement of a program venture, for the debts and obligations of the venture, subject to certain exculpation and indemnification rights pursuant to the terms of the governing agreement;
our joint venture agreements may contain provisions that would allow partners to remove us as the general partner or managing member in certain cases involving cause;
while we would have discretion to manage joint ventures for which we are the general partner or managing member, our partner(s)’ approval would be required to approve certain matters, and as a result, we may be unable to cause a joint venture to implement certain decisions that we consider beneficial; and
with respect to our participation in the co-investment program, we could lose opportunities to pursue properties that are within the program’s target investment definition alone or with other partners with whom the terms of the joint venture and/or our returns could be more favorable to us.
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ITEM 2—Unregistered Sales of Equity Securities and Use of Proceeds
Boston Properties, Inc.
(a)None.
(b)Not Applicable.
(c)Issuer Purchases of Equity Securities.
Period(a)
Total Number of Shares of Common Stock
Purchased
(b)
Average Price Paid per Common Share
(c)
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
(d)
Maximum Number (or Approximate Dollar Value) of Shares that May Yet be Purchased
January 1, 2021 – January 31, 20217,785 (1)$94.79 N/AN/A
February 1, 2021 – February 28, 2021387 (1)$90.61 N/AN/A
March 1, 2021 – March 31, 20211,092 (2)$0.01 N/AN/A
Total9,264 $83.44 N/AN/A
Period(a)
Total Number of Shares of Common Stock Purchased
(b)
Average Price Paid per Common Share
(c)
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
(d)
Maximum Number (or Approximate Dollar Value) of Shares that May Yet be Purchased
July 1, 2021 – July 31, 2021105 (1)$0.01 N/AN/A
August 1, 2021 – August 31, 20212,023 (1)$0.01 N/AN/A
September 1, 2021 – September 30, 2021— $— N/AN/A
Total2,128 $0.01 N/AN/A
___________
(1)Represents shares of restricted common stock of BXP surrendered by employees to BXP to satisfy such employees’ tax withholding obligations in connection with the vesting of restricted common stock.
(2) Represents shares of restricted common stock of BXP repurchased in connection with the termination of a certain employee’semployees’ employment with BXP. Under the terms of the applicable restricted stock award agreements, the shares were repurchased by BXP at a price of $0.01 per share, which was the amount originally paid by such employeeemployees for such shares.
Boston Properties Limited Partnership
(a)Each time BXP issues shares of stock (other than in exchange for common units when such common units are presented for redemption), it contributes the proceeds of such issuance to BPLP in return for an equivalent number of partnership units with rights and preferences analogous to the shares issued. During the three months ended March 31,September 30, 2021, in connection with issuances of common stock by BXP pursuant to issuances to employees of restricted common stock under the Boston Properties, Inc. 2012 Stock Option and Incentive Plan (the “2012 Plan”), exercises of non-qualified stock options under the 20122021 Plan and the Boston Properties, Inc. 1997 Stock Option and Incentive Plan and issuances of common stock under the Boston Properties, Inc. 1999 Non-Qualified Employee Stock Purchase Plan, BPLP issued an aggregate of 246,34822,862 common units to BXP in exchange for approximately $20.3 million,$452,250, the aggregate proceeds of such common stock issuances to BXP. Such units were issued in reliance on an exemption from registration under Section 4(a)(2) of the Securities Act of 1933, as amended.
(b)Not Applicable.
(c)Issuer Purchases of Equity Securities.
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Period(a)
Total Number of Units
Purchased
 (b)
Average Price Paid per Unit
(c)
Total Number of Units Purchased as Part of Publicly Announced Plans or Programs
(d)
Maximum Number (or Approximate Dollar Value) of Units that May Yet be Purchased
January 1, 2021 – January 31, 20217,785 (1)$94.79 N/AN/A
February 1, 2021 – February 28, 2021286,312 (2)$0.37 N/AN/A
March 1, 2021 – March 31, 20211,291 (3)$0.05 N/AN/A
Total295,388  $2.86 N/AN/A
Period(a)
Total Number of Units Purchased
 (b)
Average Price Paid per Unit
(c)
Total Number of Units Purchased as Part of Publicly Announced Plans or Programs
(d)
Maximum Number (or Approximate Dollar Value) of Units that May Yet be Purchased
July 1, 2021 – July 31, 2021850 (1)$0.22 N/AN/A
August 1, 2021 – August 31, 20212,195 (2)$0.03 N/AN/A
September 1, 2021 – September 30, 2021— $— N/AN/A
Total3,045  $0.08 N/AN/A
___________
(1)Represents common units previously held by BXP that were redeemed in connection with the surrender of shares of restricted common stock of BXP by employees to BXP to satisfy such employees’ tax withholding obligations in connection with the vesting of restricted common stock.
(2)Includes 285,925 2018 MYLTIP units. The measurement period for such 2018 MYLTIP units ended on February 5, 2021 and BXP’s total return to stockholders was sufficient for employees to earn and therefore become eligible to vest in a portion of the 2018 MYLTIP units. Under the terms of the applicable 2018 MYLTIP award agreements, the 285,925 unearned 2018 MYLTIP units were repurchased at a price of $0.25 per 2018 MYLTIP unit, which was the amount originally paid by each employee for the units. Also includes 387 common units previously held by BXP that were redeemed in connection with the surrender of shares of restricted common stock of BXP by employees to BXP to satisfy such employees’ tax withholding obligations in connection with the vesting of restricted common stock.
(3)Includes 1,092105 common units previously held by BXP that were redeemed in connection with the repurchase of shares of restricted common stock of BXP in connection with the termination of a certain employees’employee’s employment with BXP and 199745 LTIP units that were repurchased by BPLP in connection with the termination of ana certain employee’s employment with BXP. Under the terms of the applicable restricted stock award agreementsagreement and LTIP unit vesting agreements, such shares were repurchased at a price of $0.01 per share and such LTIP units were repurchased at a price of $0.25 per LTIP unit, which were the amounts originally paid by such employee for such shares and LTIP units.
(2)Includes 2,023 common units previously held by BXP that were redeemed in connection with the repurchase of shares of restricted common stock of BXP in connection with the termination of a certain employee’s employment with BXP and
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172 LTIP units that were repurchased by BPLP in connection with the termination of a certain employee’s employment with BXP. Under the terms of the applicable restricted stock award agreements and LTIP unit vesting agreement, such shares were repurchased at a price of $0.01 per share and such LTIP units were repurchased at a price of $0.25 per LTIP unit, which were the amounts originally paid by such employee for such shares and LTIP units.
ITEM 3—Defaults Upon Senior Securities.
None.
ITEM 4—Mine Safety Disclosures.
None.
ITEM 5—Other Information.
(a)None.
(b)None.
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ITEM 6—Exhibits.
(a)Exhibits 
4.1 
31.1 
31.2 
31.3 
31.4 
32.1 
32.2 
32.3 
32.4 
101.SCHInline XBRL Taxonomy Extension Schema Document. (Filed herewith.)
101.CALInline XBRL Taxonomy Extension Calculation Linkbase Document. (Filed herewith.)
101.LABInline XBRL Taxonomy Extension Label Linkbase Document. (Filed herewith.)
101.PREInline XBRL Taxonomy Extension Presentation Linkbase Document. (Filed herewith.)
101.DEFInline XBRL Taxonomy Extension Definition Linkbase Document. (Filed herewith.)
104 Cover Page Interactive Data File (formatted as Inline XBRL with applicable taxonomy extension information contained in Exhibits 101.*101*.). (Filed herewith.)
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


BOSTON PROPERTIES, INC.
May 7,November 5, 2021
/s/    MICHAEL R. WALSH        
Michael R. Walsh
Chief Accounting Officer
(duly authorized officer and principal accounting officer)
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


 BOSTON PROPERTIES LIMITED PARTNERSHIP
By: Boston Properties, Inc., its General Partner
May 7,November 5, 2021  
/s/    MICHAEL R. WALSH        
  Michael R. Walsh
  Chief Accounting Officer
(duly authorized officer and principal accounting officer)
83104