EXHIBIT 99.2
BOSTON PROPERTIES, INC.
111 HUNTINGTON AVENUE
BOSTON, MA 02199
(NYSE: BXP)
AT THE COMPANY AT THE FINANCIAL RELATIONS BOARD
- -------------- -------------------------------------------
Douglas T. Linde Marilynn Meek - General Info. (212) 445-8431
Chief Financial Officer Claire Koeneman - Analyst (617) 520-7004
(617) 236-3300 Judith Sylk-Siegel - Media (212) 445-8431
BOSTON PROPERTIES, INC. ANNOUNCES
FOURTH QUARTER 2001 RESULTS
REPORTS DILUTED FFO PER SHARE OF $0.95
BOSTON, MA, JANUARY 22, 2002 - BOSTON PROPERTIES, INC. (NYSE: BXP) today
reported results for the fourth quarter ended December 31, 2001.
Funds from Operations (FFO) for the quarter ended December 31, 2001 were
$90.7 million, or $1.00 per share basic and $0.95 per share diluted before an
accounting charge related to the application of SFAS No. 133, "Accounting for
Derivative Instruments and Hedging Activities" and net of early surrender
lease income recognized and payments received.
FFO for the fourth quarter of 2001 compares to FFO of $71.9 million, or $0.89
per share basic and $0.85 per share diluted for the quarter ended December
31, 2000. This represents a 11.8% quarter to quarter increase in diluted FFO
per share. The weighted average number of basic and diluted shares
outstanding totaled 90,736,578 and 105,577,393, respectively, for the quarter
ended December 31, 2001 and 80,885,230 and 96,008,217, respectively, for the
same quarter last year.
FFO, as adjusted above, for the year ended December 31, 2001 were $337.8
million, or $3.75 per share basic and $3.57 per share diluted. FFO for the
year ended 2001 compares to FFO of $247.4 million, or $3.46 per share basic
and $3.31 per share diluted for the year ended December 31, 2000. This
represents a 7.9% year to year increase in diluted FFO per share. The
weighted average number of basic and diluted shares outstanding
-MORE-
totaled 90,001,534 and 105,185,427, respectively, for the year ended December
31, 2001 and 71,424,207 and 85,723,101, respectively, for last year.
Net income before the charge related to SFAS No. 133, gain on the sale of
real estate, extraordinary item and cumulative effect of a change in
accounting principle totaled $54.4 million or $0.59 per share diluted in the
fourth quarter of 2001 as compared to $43.5 million or $0.52 per share
diluted for the same period in 2000. This represents a 13.5% per share
increase in diluted net income quarter over quarter.
Net income, as adjusted per the preceding paragraph, totaled $220.6 million or
$2.40 per share diluted for the year ended 2001 as compared to $147.0 million
or $2.02 per share diluted for the same period in 2000. This represents a
18.8% per share increase in diluted net income year over year.
The reported results are unaudited and there can be no assurance that the
results will not vary from the final information for the quarter and year
ended December 31, 2001. In the opinion of management, all adjustments
considered necessary for a fair presentation of these reported results have
been made.
As of December 31, 2001, the Company's portfolio consisted of 147 properties
comprising more than 40.7 million square feet, including 12 properties under
development totaling 4.9 million square feet. The overall occupancy rate for the
properties in service as of December 31, 2001 was 95.3%.
Additional highlights of the fourth quarter include:
o The refinancing of the mortgage loan collateralized by 10 & 20 Burlington
Mall Road and 91 Hartwell Avenue on October 1, 2001. The new financing
totaling $40.0 million bears interest at a fixed rate of 7.25% and matures
in October 2011.
o The completion of Building Two in the Quorum Office Park development
project, an approximately 130,000 square foot office building in
Chelmsford, Massachusetts. This project is 100% leased.
o The repurchase of 78,900 shares of the Company's Common Stock at a cost of
$2.7 million, with an average price per share of $34.46.
o The acquisition of a 74-acre parcel of land in Weston, Massachusetts in
December 2001 for approximately $18 million, which includes a deposit made
in 2000 of approximately $9 million. This site will support an
approximately 350,000 square foot Class A office building.
o The acquisition of an approximately 22-acre parcel of land in Reston,
Virginia in November 2001 for approximately $8.6 million. This site will
support an approximately 358,000 square foot Class A office building.
o The disposition of a parcel of land known as the Belvedere
Condominium/Retail Project located at the Prudential Center in Boston,
Massachusetts for net proceeds of approximately $11 million.
Boston Properties will conduct a conference call tomorrow, January 23, 2002 at
10:00 AM (Eastern Time) to discuss the results of this year's fourth quarter.
The number to call for this interactive teleconference is (888) 413-4411. A
replay of the conference call will be available through January 30, 2002 by
dialing (888) 266-2086 and entering the passcode 5744949.
Additionally, a copy of Boston Properties' fourth quarter 2001 "Supplemental
Operating and Financial Data" will be available on the Investor section of the
company's website at HTTP://WWW.BOSTONPROPERTIES.COM. These materials are also
available by contacting Investor Relations at 617-236-3300 or by written request
to:
Investor Relations
Boston Properties, Inc.
111 Huntington Avenue
Boston, MA 02199
Boston Properties is a fully integrated, self-administered and self-managed real
estate investment trust that develops, redevelops, acquires, manages, operates
and owns a diverse portfolio of Class A office, industrial and hotel properties.
The Company is one of the largest owners and developers of Class A office
properties in the United States, concentrated in four core markets - Boston,
Midtown Manhattan, Washington, DC and San Francisco.
THIS PRESS RELEASE CONTAINS FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF THE
FEDERAL SECURITIES LAWS. YOU SHOULD EXERCISE CAUTION IN INTERPRETING AND RELYING
ON FORWARD-LOOKING STATEMENTS BECAUSE THEY INVOLVE KNOWN AND UNKNOWN RISKS,
UNCERTAINTIES AND OTHER FACTORS WHICH ARE, IN SOME CASES, BEYOND BOSTON
PROPERTIES' CONTROL AND COULD MATERIALLY AFFECT ACTUAL RESULTS, PERFORMANCE OR
ACHIEVEMENTS. THESE FACTORS INCLUDE, WITHOUT LIMITATION, THE ABILITY TO ENTER
INTO NEW LEASES OR RENEW LEASES ON FAVORABLE TERMS, DEPENDENCE ON TENANTS'
FINANCIAL CONDITION, THE UNCERTAINTIES OF REAL ESTATE DEVELOPMENT AND
ACQUISITION ACTIVITY, THE ABILITY TO EFFECTIVELY INTEGRATE ACQUISITIONS, THE
COSTS AND AVAILABILITY OF FINANCING, THE EFFECTS OF LOCAL ECONOMIC AND MARKET
CONDITIONS, REGULATORY CHANGES AND OTHER RISKS AND UNCERTAINTIES DETAILED FROM
TIME TO TIME IN THE COMPANY'S FILINGS WITH THE SECURITIES AND EXCHANGE
COMMISSION.
Financial tables follow.
<Page>
BOSTON PROPERTIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
Three months ended Year ended
December 31, December 31,
----------------------------- -----------------------------
2001 2000 2001 2000
------------ ------------ ------------ ------------
(unaudited and in thousands, (unaudited and in thousands,
except for per share amounts) except for per share amounts)
Revenue
Rental:
Base rent $221,664 $183,319 $ 847,726 $715,358
Recoveries from tenants 26,966 23,736 107,883 92,692
Parking and other 11,757 12,797 52,001 50,892
------------ ------------ ------------ ------------
Total rental revenue 260,387 219,852 1,007,610 858,942
Development and management services 3,878 3,405 13,190 11,837
Interest and other 1,829 5,270 12,178 8,574
------------ ------------ ------------ ------------
Total revenue 266,094 228,527 1,032,978 879,353
------------ ------------ ------------ ------------
Expenses
Operating 83,611 67,335 312,294 264,701
General and administrative 8,663 9,791 38,312 35,659
Interest 59,730 50,854 223,389 217,064
Depreciation and amortization 40,230 36,088 150,163 133,150
Loss on investments in securities - - 6,500 -
------------ ------------ ------------ ------------
Total expenses 192,234 164,068 730,658 650,574
------------ ------------ ------------ ------------
Income before net derivative losses, minority interests
and income from unconsolidated joint ventures 73,860 64,459 302,320 228,779
Net derivative losses (2,080) - (26,488) -
Minority interests in property partnerships 456 (250) 1,085 (932)
Income from unconsolidated joint ventures 1,345 402 4,186 1,758
------------ ------------ ------------ ------------
Income before minority interest in Operating Partnership 73,581 64,611 281,103 229,605
Minority interest in Operating Partnership (19,237) (19,472) (75,393) (76,039)
------------ ------------ ------------ ------------
Income before gain (loss) on sales of real estate 54,344 45,139 205,710 153,566
Gain (loss) on sales of real estate, net of minority interest 2,584 73 9,089 (234)
------------ ------------ ------------ ------------
Income before extraordinary loss 56,928 45,212 214,799 153,332
Extraordinary loss, net of minority interest - (334) - (334)
------------ ------------ ------------ ------------
Income before cumulative effect of a change in accounting
principle 56,928 44,878 214,799 152,998
Cumulative effect of a change in accounting principle, net
of minority interest - - (6,767) -
------------ ------------ ------------ ------------
Net income before preferred dividend 56,928 44,878 208,032 152,998
Preferred dividend (1,648) (1,643) (6,592) (6,572)
------------ ------------ ------------ ------------
Net income available to common shareholders $ 55,280 $ 43,235 $ 201,440 $146,426
============ ============ ============ ============
Basic earnings per share:
Income before gain on sales of real estate,
extraordinary item and cumulative effect of a change
in accounting principle $ 0.58 $ 0.53 $ 2.21 $ 2.05
Gain on sales of real estate, net of minority interest 0.03 0.10 -
Extraordinary loss, net of minority interest - - - -
Cumulative effect of a change in accounting principle,
net of minority interest - - (0.07) -
------------ ------------ ------------ ------------
Net income available to common shareholders $ 0.61 $ 0.53 $ 2.24 $ 2.05
============ ============ ============ ============
Weighted average number of common shares outstanding 90,737 80,885 90,002 71,424
============ ============ ============ ============
Diluted earnings per share:
Income before gain on sales of real estate, extraordinary
item and cumulative effect of a change in accounting
principle $ 0.57 $ 0.52 $ 2.16 $ 2.01
Gain on sales of real estate, net of minority interest 0.03 0.10 -
Extraordinary loss, net of minority interest - - - -
Cumulative effect of a change in accounting principle,
net of minority interest - - (0.07) -
------------ ------------ ------------ ------------
Net income available to common shareholders $ 0.60 $ 0.52 $ 2.19 $ 2.01
============ ============ ============ ============
Weighted average number of common and common
equivalent shares outstanding 92,593 83,013 92,200 72,741
============ ============ ============ ============
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BOSTON PROPERTIES, INC.
FUNDS FROM OPERATIONS
(unaudited and in thousands)
Three months ended Year ended
December 31, December 31,
----------------------------- -----------------------------
2001 2000 2001 2000
------------ ------------ ------------ ------------
Income before net derivative losses (SFAS No. 133),
minority interests and income from unconsolidated
joint ventures $ 73,860 $64,459 $302,320 $228,779
Add:
Real estate depreciation and amortization 41,034 36,830 153,550 134,386
Income from unconsolidated joint ventures 1,345 402 4,186 1,758
Less:
Net derivative losses (SFAS No. 133) (2,080) - (26,488) -
Minority property partnerships' share of funds
from operations (776) (287) (2,322) (1,061)
Preferred dividends and distributions (8,448) (8,246) (33,312) (32,994)
------------ ------------ ------------ ------------
Funds from operations $104,935 $93,158 $397,934 $330,868
Add (subtract):
Net derivative losses (SFAS No. 133) 2,080 - 26,488 -
Early surrender lease adjustment 3,927(1) - (8,518)(2) -
------------ ------------ ------------ ------------
Funds from operations before net derivative losses
(SFAS No. 133) and after early surrender lease
adjustment $110,942 $93,158 $415,904 $330,868
============ ============ ============ ============
Funds from operations available to common shareholders
before net derivative losses (SFAS No. 133) and after
early surrender lease adjustment $ 90,704 $71,888 $337,823 $247,371
============ ============ ============ ============
Weighted average shares outstanding - basic 90,737 80,885 90,002 71,424
============ ============ ============ ============
FFO per share basic before net derivative losses
(SFAS No. 133) and after early surrender adjustment $ 1.00 $ 0.89 $ 3.75 $ 3.46
============ ============ ============ ============
FFO per share basic after net derivative losses
(SFAS No. 133) and before early surrender lease adjustment $ 0.95 $ 0.89 $ 3.59 $ 3.46
============ ============ ============ ============
Weighted average shares outstanding - diluted 105,577 96,008 105,185 85,723
============ ============ ============ ============
FFO per share diluted before net derivative losses
(SFAS No. 133) and after early surrender lease adjustment $ 0.95 $ 0.85 $ 3.57 $ 3.31
============ ============ ============ ============
FFO per share diluted after net derivative losses
(SFAS No. 133) and before early surrender lease adjustment $ 0.90 $ 0.85 $ 3.42 $ 3.31
============ ============ ============ ============
(1) Represents cash received under contractual obligations.
(2) Income earned of $12.4 million during Q3 2001 net of cash received.
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BOSTON PROPERTIES, INC.
CONSOLIDATED BALANCE SHEETS
December 31,
2001 2000
------------ ------------
(in thousands, except for share amounts)
ASSETS
Real estate: $7,457,906 $6,112,779
Less: accumulated depreciation (719,854) (586,719)
------------ ------------
Total real estate 6,738,052 5,526,060
Cash and cash equivalents 98,067 280,957
Escrows 23,000 85,561
Investments in securities 4,297 7,012
Tenant and other receivables 43,546 26,852
Accrued rental income 119,494 91,684
Deferred charges, net 107,573 77,319
Prepaid expenses and other assets 20,996 41,154
Investments in unconsolidated joint ventures 98,485 89,871
------------ ------------
Total assets $7,253,510 $6,226,470
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Mortgage notes and bonds payable $4,314,942 $3,414,891
Accounts payable and accrued expenses 81,108 57,338
Dividends and distributions payable 79,561 71,274
Interest rate contracts 11,147 -
Accrued interest payable 9,080 5,599
Other liabilities 58,859 51,926
------------ ------------
Total liabilities 4,554,697 3,601,028
------------ ------------
Commitments and contingencies - -
------------ ------------
Minority interests 844,740 877,715
------------ ------------
Series A Convertible Redeemable Preferred Stock,
liquidation preference $50.00 per share,
2,000,000 shares issued and outstanding 100,000 100,000
------------ ------------
Stockholders' equity:
Excess stock, $.01 par value, 150,000,000 shares
authorized, none issued or outstanding - -
Common stock, $.01 par value, 250,000,000 shares
authorized, 90,780,591 and 86,630,089 issued and
outstanding in 2001 and 2000, respectively 908 866
Additional paid-in capital 1,789,521 1,673,349
Dividends in excess of earnings (17,669) (13,895)
Treasury Common Stock, at cost (2,722) -
Unearned compensation (2,097) (848)
Accumulated other comprehensive loss (13,868) (11,745)
------------ ------------
Total stockholders' equity 1,754,073 1,647,727
------------ ------------
Total liabilities and stockholders' equity $7,253,510 $6,226,470
============ ============
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BOSTON PROPERTIES, INC
PORTFOLIO OCCUPANCY
Occupancy by Location
December 31, 2001 December 31, 2000
----------------- -----------------
Greater Boston 92.3% 99.3%
Greater Washington, D.C. 97.8% 98.5%
Midtown Manhattan 99.8% 99.9%
Baltimore, MD 99.2% 99.8%
Richmond, VA 98.4% 100.0%
Princeton/East Brunswick, NJ 88.6% 98.7%
Greater San Francisco 93.5% 97.9%
Bucks County, PA 100.0% 100.0%
----------------- -----------------
Total Portfolio 95.3% 98.9%
================= =================
Occupancy by Type
December 31, 2001 December 31, 2000
----------------- -----------------
Class A Office Portfolio 95.4% 99.0%
Office/Technical Portfolio 97.9% 98.0%
Industrial Portfolio 87.3% 95.9%
----------------- -----------------
Total Portfolio 95.3% 98.9%
================= =================