Boston Properties (BXP) 28 Jan 212020 Q4 Earnings call transcript

Good morning, and welcome to Boston Properties' Fourth Quarter and 2020 Earnings Call. This call is being recorded. All audience lines are currently in a listen-only mode.

Our speakers will address your questions at the end of the presentation during the question-and-answer session. At this time, I would like to turn the conference over to Ms. Investor Boston of VP Buda, Relations Properties. for Sara go ahead. Please

release Reg and Great. most earnings measure and press X-K. were In good Company on welcome the package, reconciled and you G. last conference supplemental accordance night distributed in to The the XXXX everybody, to Form quarter all GAAP morning, Thank non-GAAP directly furnished measures package comparable fourth Boston call. with the supplemental and has Properties' financial

we a copy, Investor this receive available Securities this documents within are our forward-looking If at time, statements the statements not inform which you Litigation certain meaning months. may that made conference webcast be these the of Reform available constitute in call Relations like website At did for the during Act. XX will Private of would are section to you of call, investors.bxp.com. not historical, A this

Chief reflected assumptions, assurance are the results statements forward-looking in were to cause believes release forward-looking Properties Executive filings Officer; detailed actual expectations its to differ Doug risks that can Linde, Boston it Company Factors that will be could Chief from and implied Officer. expressed to yesterday's and expectations the forward-looking by time Although or and Financial any statements. statements those attained. reasonable LaBelle, Company's any update press give in materially not undertake in welcome on based to with Thomas, no Owen time The SEC. duty the from does a I'd Mike like President;

President, Thomas formal management call to will would and our over any now the of call, like regional remarks. be portion to questions. Ritchey, teams address Ray Executive, Q&A Owen his the Vice I Senior for During available turn to our

potential about we at depart Properties' growth typical in point enthusiastic the future prospects why from Thank time. Today, and you, of going instead and all and everyone. organization reasons the confident my summarize in are remarks good to this I'm Company's unique morning, Sara, Boston

year, my and Properties' accomplishments markets I as of past conditions, current capital will strategy. of the decisions Boston part address property and as As comments, capital allocation and challenges well

and the growth, will long-term we why and Properties' three from with income in closed both potential Boston now? BXP why for short out So where begin points I XXXX. on

variable our will income streams First, recover.

refrigerated Over at easily pandemic. XX approval, economic wants a this rates the in conditions economic Boston summer. damage likely months, Johnson caused authorities its have significant least roll end more will as the of to have well vaccine health Johnson Two one will who stimulus X.X% and activity vaccine, Americans to The high is with dose help the we next bridge more & leasing of vaccinated anyone vaccines aggressively received by are be one is efficacy of improvements the accommodated the be been near Properties as rapid already as advising COVID-XX out, administration witness that and pandemic. economic of most pursuing by vaccine predictable enjoy FDA-approved, Biden and the the

likely percentage infections in high recovered population of by vaccinated, the from herd the Given a infection drop of immunity middle and/or will year. created either the the precipitously

and out anxious normal to isolation come We return are to all lives. our of

strong likely see all Properties parking, And a will as variable from we Approximately and of recovery customers, the in our travel. were reopen variable economy retail offices, hotel, which will came income by streams the these in term reopens. million XXXX the and decrease the rate will the devastated as the single lockdowns. near of $XX streams drops, infection economy FFO restaurants, to theaters, income So Boston shops, and return in individuals of

Second, Boston portfolio office Properties' is stable.

X.X% Only of pandemic collecting decreases pandemic. the our demonstrating average office quality market roll on of we rents last the roll-ups of cushion been leases in our providing owed, three this year office the years, over caused the XX% have by a through buildings for our XX% experienced and tenants. We over and rent

of experience XXX,XXX vacant We rent on space square XXXX. have that will in leases feet commencement currently signed over

the rent experienced charges in We XXXX non-cash XXXX. cease balances expect in not diminish to accrued for if

we all We are a risk. vast cash basis on of rent now recognizing as retail and the majority well for co-working tenants, theater as at credits consider

and service also delivering under million Street, just assets three year, or East in into We XXrd whole leased. be Causeway, and aggregate this feet a X part square Street, will XXX XXX XXX XX% in West

four projects stabilization X.X are are million next of in seven and balance Third, years. X%. generate cost Boston funded and readily square XX% We which approximately cash Properties drivers, yields under growth on over have total and quantifiable $X.X These fully our feet pre-leased, investment. sheet, on at significant currently with the redevelopment development to cash projected comprising has external projects billion

with In units A reopens. addition, X,XXX leased Reston substantial an Oakland upside the we aggregate XX% as apartment have are only delivered recently of economy three Boston, income complexes that and and urban in Class

to We X.X% over expect to our pipeline delivering annually development the the next growth income FFO four this add from years.

over dictated year The of lastly, office, majority conditions. new lab, million We conversions. of and which are we and over science by life also square development, $XXX own as anticipate feet land commence control which market And or million. we will starts XX developments potential aggregating residential of this

build, relate principal our own points high-quality strategic business Boston to Now, is buildings. for next model and strategy, my acquire core Properties and to a

and customers XXX among dominated take Higher recession and of advantage times portfolio respective urban certain as Clarendon to the more many by such their of Tower, stay upgrade Kendall rents quality leading markets buildings lower A is better Our Center. in perform Motors occupied as Salesforce their assets, space. in buildings Street, Class the General Building,

York to total from the example, A went pandemic, for their the reported from XX% New during For tours of City VTS database Class buildings before XX% in pandemic. that

local attractiveness sciences. budgets is the of hallmark clustered Future which our coastal U.S., to businesses and job jurisdictions, market job have for in to health strategy believe brought, is Another as the of unmatched target acknowledge life city quality has We by relocations and advantage. educational, clustering individual where and long-term as productive in gateway attract leading opportunities target and we workers basic rental growth supply. Angeles, an Boston, clustering computer resources in more increased in our a operate, with our well estate tax workers cities pandemic and aspire as driven office markets. and the Knowledge markets DC, science create economic distinct when Washington and damage lower supply. both selection remain to the Francisco, knowledge Seattle, of are particularly Los going civic driven have New we environments. The new the attractiveness cultural, currently and and of as clusters two knowledge but to and San York, owner where workers the barriers and we life others markets the confident is our barriers growth more reasons: have in and in science to fields, growth, be technology working To value job demand need to real the you which of office

to is fully construction. square business a of local X.X ordinances, our around Properties complexity sites, lease X.X development, obstacles anti-development in years, averages. Boston term with built-in feet My cost operating capability have in including integrated of model weighted available we were recent XX% markets and and of permitting, dearth of point quality Our new and last leasing difficulty a XXXX, able is which In execution. average to million annual on lease

we and core annual opportunities, While cities retaining in of procurement activity talent. XX% are a and our advantages and investment providing attracting recent in the all averages, accessing leasing markets our approximately market-leading participant, was new

The caused that for but convenience concerns pandemic, and time. parking, which We streams, from model the of more and from leaders is our supervision. ENERGY are office space valuation. impact relate in best specifically, hotel Boston Fitwel, of In where is Responsible I leading addressed disconnected productive on period. same work remote to the the want ranking. gateway quarters want variability gap in about demand. and recent foster mentoring, a safety pre-pandemic to return which office expectations, GRESB, office My collaboration, COVID-XX, retail recently most company the levels, completed to the from the believe earlier, to Business in three with over last and demand to in as price, second next home teamwork, want more dissipate dropped industry are which office property think culture, work workers after EPA, XX% Properties' reiterate stock and impact clearly we time the and to approximately our the company back FFO by as and provide performance over XX% by XXXX STAR, their markets dropped will they the and XXXX versus of XX% over points to to and an pandemic hybrid has stay here overblown. employee the office home others, employees but measured are well, of concern income should recognized were from survey leader more the Newsweek's Because work as collaborative, ESG they fears Most by Gensler, Companies USGBC, and is a

last cap quarter There office employers the a the future, to exposures. more Office investors of office continues XX% where working more technology-driven High-quality layout Properties. estate may look-through market in those where sub-X% XXXX the fourth lower up translate but assets market. XX% total on three quarters quarters as market down in prior a A were quarter. both to much down Though year, no those and current of commercial office the savings Class share the be of of office, rate out as a with an census was XXXX XX% at the as employees quality there also price markets more for space quarter our workstation. transaction at office the each well cap difficult assets There it. were after XX% of quarter last XXXX. in the Though robust improved Volumes the rate. estate from of fourth in pandemic as real to portfolio volumes real only market leasing Boston is portfolio is the activity for other third sequentially X.X%. in wanted comparable will life real of a were private in are be is XX% is it returned markets be privacy office employees' more and from the our estate, valuing limited gateway transaction when due valuing in for while trading to However, in and private XXXX materially versus Boston want the Properties desire and office volume surveyed fixed favor XX% then At classes the workstation volume was buildings public surveyed science asset into between disconnect assigned employees to remotely

square in potentially will like in Avenue sold described San term, activity a and York remain X+U and million, for and leasehold Just X.X% and and a X.X% expect earlier, activity with increase in and is square rate Seattle recovery low combined interest for a $XXX to in a science roll-up dominated we'll a million, for Streets to the X.X% rate. a cap sold transaction tighten that equated to was And one Avenue has Boston a opportunities Properties Park themselves a There a a result lastly, long Townsend to in rate. million, a forecast rates sheet our million, interest Tenth for Cambridge present and by also foot Brannan pipeline, in rate, leasehold rate. a investment life liquidity in for cap X.X% of liquidity unsecured cap redemption we sold funding City $X.X Eighth and cap foot, foot, $X,XXX square XXX its XXX material current sold mid-X% portfolio remaining. full the rate, advantage partial Cambridge assets and - New economic and office, million, $XXX Though as science a We X% access interest sold to user. and in well-leased currently with to of fully of for square square University to which in in the and the interest pandemic. billion in is $X.X development foot and in cap billion rates Properties. And $XXX have billion, assets. a and potential, square sub-let And Boston sold life $XXX the leased buildings around a $XXX $X,XXX capital our balance Francisco both bonds cap Discovery a have is $XXX foot, CBD, by $X.X take in being XXX of $X,XXX foot, Park and $X,XXX cap representing a are XXXX And a after for $X,XXX

We similarly elevated having completed have been year. monetizing in-service in level a activity we actively gross $XXX expect this in XXXX, more sales assets, million and of

We have fund equity increasingly size needed formalized access scale debt unsecured partners attractive to to acquisitions. been terms if help large and developing have private and at the us relationships with market

have returns. We look create leasing of for potential core take our pipeline and advantage Seattle continue higher markets our a and/or and to to opportunities in redevelopment operating new to require of investments skills reasonable that in

in Cambridge, redevelopment and primarily of real life under As and to and mentioned, of we San the also life science have control science intend our South estate million Waltham, more feet located square development aggressively X.X hubs new projects into invest Francisco.

the create estate, and environment many a the assets. to U.S. for office challenging real conclusion, very commercial sectors in continues pandemic of COVID-XX including So economy

potential, However, to you. to approaching and engaged team. is our stability, quality, momentum the of confident given over with growth capital, income access portfolio the emerge highly and and Properties end Boston Doug, strength will management pandemic are we

Thanks the give and thought Mike and just about well. right time of remarks starting some as Owen. sort everybody. for make but I'll stopping guess I I morning, there Good some questions,

in bringing as COVID, weeks are to in their that's dates. office starting the in and pickup need six another question CBD. two transaction sit obstacle tenant Boston the the cases in rapid in leasing vaccine, Amazon and the X,XXX rejuvenate we of As the is But to of here and announced last XX,XXX COVID, Boston two companies a shifting suppressed the a feet signal conversations activity XXXX, about processes. tours as tenant of signed jobs yesterday, beginning staff to January committing expected weeks, large XXXX, a built and building increase to square no to leasing to vaccine, during we that There the announced office return be discussions space that to XXXX from COVID an feet that vaccine, for in time. period to over back have square just December to of the XXXX they're work We bringing Boston last and LOI going additional XXX,XXX COVID,

sublet types heard with saw are organizations commercial everywhere. volumes to space. surprises historical many to Leasing availability that of calls. are leasing been latter increased will by were held of through be there that first analysts' we market space we've through sales. cautiously have of remember a sublet half year-end worst optimistic as of XXXX volume, So retail the significant to you while and It's pandemic, in absorption off that pickup two are pace the and is probably that reports brokerage the few the their the expected parking revenue, quiet, and leasing transaction and XXXX the part published discernible The we market, important way the the added of negative

may offer One actionable sure, life we from actually that may that But an a science, way if First, space to home, all had that they by firms, our comes and workplace them may financial at strategy, sublet that employee we're relocate a in responsible do, changes sublet it, users go their workforce. a space need conversations with tenants our are with our available. bulk the second these space, decide technology, a.k.a., to what not the in premises reoccupy is professional change they'll of our brokers an as a opportunistic, have then, are of legal, that or sublet thing had the down we're space. acceptable leasing to their the what's cost activity. service, That's just there their We is in clearly and as disaggregated no they group, listings, work They headcount and from is road. to expectation a on have find going the that know. all going get the of or to not to driving all way based no portion well our being listing transact entire the don't for are longer they

square XX% withdrawn the of is the to Dock Midtown, Between of available. the into XXXX, or quarterly the is You drop after XXXX million sublet at occupied. XXXX Recession, according XX.X in-service following of XX% from might The on find of entirely that illustrative leased put Manhattan, office XX Great Properties' the the portfolio ended In was XX was at Boston market. The million to that. addition sequential market. CBRE year square and XXXX, about Not from the XX.X% feet space feet, due to all portfolio. space

the have as Peninsula the tours, our we Virginia; way, Waltham, lease activity signed leased. of DC Starting As our in has defined portfolio, quarter. Princeton; in-service On Silicon XXX,XXX-plus another and during Owen least. we square yet commenced best active relative have We basis, and Midtown with but completed is my Manhattan; been Cambridge; has Francisco. Northern the our in any Angeles; still to said, of vacant, as points on don't it moving and space Valley; leasing markets leases, portfolio square available million finally, X.X hence not a revenue ranking by negotiations, the of is feet CBD Los the Boston, view San that the XXX RFPs follows. of the feet basis in

lease cash The are starting The During rent and the tenant increase leases, other higher expiring rent cash rent than the on Atlantic CBD, another did on four including the a be XX% quarter average weighted Boston leases five we about there Wharf. had full-floor rent increases. this in of will future the at new fourth full-floor XX%.

we during in continue feet. tenants has since the the box productive generation suburban XX,XXX at I to a use renewal lease Boylston square & also XXX,XXX as former the Lord far feets incremental our letting first additional leases, growth number conversations. to A CBD expire including building part on our we at and lease mid-XXXXs two-stories can XX% Taylor. finally we of short-term have feet, second XX leases XXXX now generation. smaller are basis. This an square to that few remaining average This a of been want Boston under up and more albeit of foot in in engaged portfolio, month. space early The with that few actively did considering a for note leasing, of XXX,XXX new of we to on of We was West the under Lord Boston Street believe rent win, were XXX,XXX looking this square find & Street. In completed Taylor their was addition on the square life CityPoint a big for we is science obtained this possession cash XXX a activity portfolio, cash about are the all

during space, We don't but and new a next we quarter, At a for XXX lease CityPoint any the have XX,XXX have hope a In fully requirements. final permitted a conversion our square foot Suburban of XXX,XXX with fully and life building our number over continue square square large construction lab we're moment, square we tenant simply a vacant of waiting few negotiating foot the in lease has go to science space, of Street, begin to XX,XXX are the responding activity we're Boston. additional XXX,XXX block and Waltham, designed, extension, foot lab feet, XXX bids months. we second to been lab to ready Winter

our we Virginia, this square completed six VA-XX single-story feet. at to park Turning XXX,XXX Northern renewals totaling about quarter

lease Reston addition feet we we XXXX Town to total, Reston negotiations the to Reston. good continue work Reston for Center. have on an to square for completed have down with flat foot ongoing leasing feet block square expiring do, to Town In XX,XXX to a XXXX, slightly contractually relet are million of completed a X.X% rents rents in by In Next, VW years Town square in we the Center increasing in but in start been XX,XXX Center, to of the and since more additional another commitment on have We still in last X.XX the X% to do basically going-forward they XX will X% the basis. so X% space. cash In

portfolio Our lease feet DC has market, XXX In and here cash space. during Square leases Tower completed square of CBD We XX,XXX on was York rests up. we Times over as too, are of for at New leasing feet the extension one-year our of deals two speak. feet our the on JV assets, our was XX-year square Asana XXX,XXX XXX,XXX quarter each office negotiating the the we Lex. but about and in floor We completed One XX,XXX we square and exposure activity with rent second square in York X% City, executed renewal. renewal a City feet a about that New at decreased picked

the did also at square short and Tower at small expiring XXth was end Park XXX West We're four Square transaction Times negotiating Three that's a XX,XXX term until space deal. one XXXX. XXX a of Street XX-year feet. not a transactions full-floor and on totaling were We

street plain, tenants to last the has for any else When in we talk tenants State our California, ongoing Francisco, a will be of relocate this from more number tenants been much for portfolio. leasing we been making fact to during activity severe and than of has are their at 'XX, CBD the strongly about in that making to go employees to Princeton do discouraging particularly strongly the didn't anywhere considering appreciate we expand we need While active XX you decisions. has Carnegie the the offices of have level late appetite the uncertainty And their months. San Center. affected The pedestrian in lack the from in decisions quarter, or and believe discussions asking

on put tech leases to company square to excess XX of from XXXX XXXX, in XXX,XXX feet. were XXXX, in per this year there were year In there Just none. average perspective,

and assets square XXX,XXX are San leased we in Our have XXXX. Francisco XX% feet expiring

we're transactions totaling It's renewals, about XX,XXX pretty during four on slow totaling up cash In quarter XX% requirements XX,XXX in hardware slow third square about another looking a active device, and in be of are produced just the fourth medical quarter, feet. market we side leases, basis, is at a the the there. feet feet. technology Area. there. all The EC, did square are of three is for Valley Francisco, all will existing able begin in three renovated area our resurgence expansions now a There Gateway during building the San View relocate JV rest to XXX development the few planning tenant that followed Mountain XXX,XXX construction energy, feet There and alternative Two more by of be did Gateway, continues conversion next XXX,XXX quarter Silicon XXX,XXX of the ground-up the Bay square of South the commencement which a and Gateway, feet excess companies space. activity over the the right there than automotive, square to XXX of the lab months to square plus technology out if

million revenue of the quarter when XXXX. was lease covered out is in building XXX,XXX seeing are and about product, Way organizations at service View, We In $X.X land looking square Santa of of we're taking of This Clara, be going plug single-story a in the our 'XX. few ready. second a and play Peterson Mountain expires our these play contributed which to feet

Santa feet And In XXX,XXX a a tenant. square of for XXXX the our the permitted approved a expirations. entitlements outset, Colorado at I new our spite we have renewal in said related LOI go. campus square signed ready with COVID Monica, negotiations from at foot California, we challenging and XX,XXX as in conditions Center We to continue

risk out lowering free rents You another Business very direct more on What market Will sublet space. however, giving don't worth the may the And landlords will currently be that on users didn't rent. Monica space with expansion will I not necessarily actually installation There there vacant company rents. settle their tenant as-is on make a space it is with at for opinion. meaningful courting that to activity, the a Or and want any year, for differences working leeway that Santa tenants, can with user. bid space. wide large lower that the I understand. Landlords is recall Park. the new space sublet to that the that pure tell amount or risk deals other entice may to my with rents will will during and have with capital technology for between make if be can rent those very about and appetite contractual market prime limited taking? uncomfortable renewals gap and landlords be associated comparable earlier with less of made outset issues are we cut at that's the tenants will With that will we comments space where direct direct a a want the very more rates swing conjecture the rents between conditions ask purposely face or remarks. any There this have an Sublet risks. you be is there installation where them did simply space will actually of for pay the transactions aggressive deal capital until full-term, face be use available about this works

to going to in submarket. in and the will time best markets. value Mike. I'm of to there However, paying yield see buildings premium going Conditions to assets stop our be flight and the a are tenants less submarket as a of to there these better quality by rest in be to vary

Excellent. Thanks, Doug. Good morning.

expectations the our cover of quarter. So we the we reinstated also I'm guidance details the environment. in an guidance, serve confidence explain operating I'll into quarterly provided some first XXXX. We've our will and going insight our for of the which for fourth earnings indicator year the that increased and FFO quarter full for to helpful as our hope be

largely are behind remain Our strong the office tenant us. and collections believe write-offs we

also We new overall related square leasing office We're a requirements mass. renewal of as the such we into the to X.X guidance feet are evidenced pandemic until despite and We square to restore leasing the X.X XXXX remains as will execute by we visibility million the But to the continue fourth our office in vaccine the Once timing. continue and see of quarter of feet shutdowns. of uncertainty respect and will expect full-year retail the anticipate to and workers confident the out by to roll revenues on have in lease million parking well. in population with return be better as ancillary we weak increases. the there timing, encouraged

fourth Our I would contained explain. to two charges results quarter like that

impairment while own arrive we is is XX, our requires is put FFO. in investment is net feet we back at into a XX%. first fair equity Yard. Navy non-cash of $X.XX an in per added unconsolidated, GAAP it investment the XXX,XXX Because the is joint income, The to service where deduction Brooklyn Also, development held square investment $XX This million unconsolidated a the from value. charge venture mark-to-current share a our Dock in

definition. Dock said, on today Brooklyn our pre-COVID, leasing has to activity we some the little reported there So FFO XX% activity XX had Doug in impact is only it promising weakened. market and leased NAREIT's conditions is no while and have as pursuant

in rest in pipeline Dock impact anticipated not XX achieve a value The this XX%. stabilization and combination our fair to at timing a extended a well very to of The extension the leased cost meaningful any as current our resulted We projected stabilize, anticipate on unique well We has the as we our situation lower has and see additional And property. of as development for have lease-up. do is increased impairments value. the portfolio. of modified fair

over honestly, is portfolio in-service Our XX% of assets gains. embedded the and have leased most significant

The second charge all FFO is industry. in co-working $X.XX the a for net $XX the for million, rental share, charge non-cash per or income tenants write-off of to income and accrued

the is we While sector's rent believe these liquidity. the tenants length pandemic paying ongoing and are stressing today, revenue the of

to As do asset standard they maintain sheet. the an on accrued not we such, balance meet believe our rent

the is is the other with additional co-working quarter to credit our face year remaining of tenants this both significant individual that retail experienced tenant XXXX. accrued a sector like situations portfolio, third due As earnings pandemic but second of monitoring the we co-working anticipate and write-offs could we've in we discussed to with the rent been calls, closely. possible in few across don't sectors impact and we we've It

For FFO quarter, reported our the $X.XX fourth per was share.

quarter If that with have per would with shared expectations you you fourth the the our we accrued share FFO consensus and line exclude last $X.XX charge, in quarter. and rent been

I'd to forward to like look Now, XXXX.

to per higher At fourth share. to quarter provided $X.XX approximately G&A. XXXX XXXX have share $X.XX per seasonally is this mid-point entirely decline share than per for before is We our lower the of $X.XX FFO of charges. quarter $X.XX due first guidance FFO The anticipated

to The for for quarter our highest accounting G&A first always compensation. quarter due is

including contribution the back If we expense from our G&A historically, for increase a of is you look The portfolio, of Doug leases the anticipated be the in by of typically our quarter. expense G&A offset that portion commencement revenue XX% signed described. annual partially higher to revenue record first in

interest We also expect expenses. lower

These bond to earning will hand. prepayment mid-February our on $XXX zero with issuance on a cash. X.X% We're yield no cash We and redeeming in have charge. bonds are currently close there of our million be

we half this and XXXX. the interest of for rest full of expense benefit lower see So the will the quarter of second for

think is as there full to XXXX, few things about year the a consider. So we

the to If online does G&A, or the developments for the impact first our our of expense that you about coming redemption, the bond account reduction our leased you seasonality year. simply midpoint from the interest share. annualize incremental of quarter But during per $X.XX of guidance, of get not

leased, a science we is NYU, to and the For to quarter; share: to Boston, leased the annualized $X.XX expense deliver starting per West XXX% XXX which is adding interest G&A of lower revenue for our new East Street, FFO share redemption; developments year; share and revenue and $X.XX and the in in of Street consider share from bond to December. XXX Causeway the where impact which QX to phasing Street, in development in third which Waltham, for $X.XX per leased life purposes, following XXX of commence is with in second including per the expect the lower incremental per of you XX% due suggest modeling from rest online, we projected XXrd $X.XX the XX% the quarter; projected coming is FFO in

of both our rate income items quarter per ancillary XXXX. million share our from of unknown. and a we have $X.XX income same-property occupancy. for remains providing is on Their than leasing, $XX impact variable and known pandemic including That these full-year still recovery for basis timing adjusting which from could material a nearly streams streams, So quarterly income approximately first our in and what Currently, revenues saw our are retail, on lower not impact there because recovery annualized the run to contribution gets of parking, we are pre-pandemic. revenues these said, our The for guidance the hotel. uncertainty depressed. FFO is It

of and the the a success of portion in will environment return cities. vaccines timing We COVID are back revenue in hopeful reliant to this but on start XXXX, healthy our return to half of that the and a the really safe is

We also occupancy same-property that will XXXX in expirations have and our lease NOI. impact

rollover XXXX million X.X Our square feet. for is

occupancy. of AFFO also down million in XXX we XXX,XXX in that XXXX. We're expect amount same-property to this that we compared rent XXXX described, a vacant have to have new year-end meaningful cash burned of currently off be that current points over feet performance year. It's occupancy on renewals space XXXX free we Overall, actively occupancy take basis noting to the leases will and boost will across square feet worth Doug our working signed already flat also that X our leases and square of of As portfolio.

build-out This most summary, fourth up we for the was results of XXX,XXX cash are our rent. our XXX,XXX now now in rent nine space paying QX. NOI Avenue, growth. Park excited is had of XXXX same-property XXX under FFO about feet In in square to million QX office from months sequentially at prospects in the XXXX, General increase we're and that revenue of rent showed cash the and free Building, for square space quarter a Motors and with and rent. feet under Specifically, $XX for a in retail of portion at free in in And cash

to of to remarks. cash give streams. rise That earnings developments expected coming the our flow our revenue of should recovery programs ancillary portfolio which growth and is in And Our value. the completes The over success grow vaccine we of next XXXX. of drive leased all couple formal should online years, of future the billion have $X.X

the If for be lines questions, up operator, that would open could you great.

[Operator comes first Instructions] Scotiabank. question the of Nick Your line from Yulico with

year-end to new you think the a down about. get on how I you know assumes gain of have helpful of XXX kind of XXXX, occupancy guess it's embedded should square of some to point explain trying rate gave away starting terms this you I about number terms just the year? points, I about on basis the maybe also maybe first end you some a leasing? or basis in basis you we to in then versus by to just said Since think that being already down of the So point points. how Can I flat XXX of on think guess what flat getting pieces renewals that actually retention XXX that occupancy

much it ready and second-generation how revenue-producing, going the revenue-producing, in have or A, to have on be we is because number currently of have we Nick, And understand vacant as the that we to space meaning be hear, while delivered to: have want have you're in probability it our It's precise of leased; space the So, but be as of is renewals, and real up to variability going to a that has we method B, this space to coming is Doug. as on not demolished. amount is not over. rolling with that

basis transaction not of points really And what start. today here know and to we so the sit we that from get are a are be desks if with vaccine will as significant where the we now going we're volume and is just activity we year driving we expectation there once to space as going that's flat-to-negative year. will, in their people we revenue is don't first about roll out believe be because in year feeling goes recognizing is people to of up population the do to and our prospects. school And confident a the of honestly, to right going expect in be we're going perspective half pickup and our on. the be business and to space very relative going just it know are that goes slow the XXX the revenue to to that's to the asked end pick what's number as It's people conditions lease don't their Again, delivery when of back back in

And be back that number. going third fourth to so the quarters impacts again are and weighted which revenue

since that guess you you the whether about negative made trying of year-end on occupancy think up on And base income when in the about guess then about of since same-property for the just then XXXX. that I'm FFO talking potential question, not you're more about to Okay. in uncertainty a full talked And range. bit and about year-end components of some leasing thought that your I a think a on little it provide Thanks, about other adjustment based guess ends occupancy to us to XXX did you one, one guidance, did, gave maybe twofold being decision Doug. just number? not Mike, year, help think, a that hearing That's talked you on guidance provide to sense a lot same-property I and streams sort I just I a give the range, helpful. leasing. you guess why days, variable terms I

can, trying are more big would we variable I'll we're describe there pretty look, a wide a assistance require it range much as to So bit would that say. little but I are as to and that try some provide pieces

based On basis points is current upon the about every occupancy XX same-store of million. $XX our rental rates of kind

quarter. income So $XX that's variable I that a could add occupancy. $X.XX is every talked XX million our share points a about basis of streams The

when know in. don't just come going So to that's we

take could be hotel hard but to that, is snap could only parking to be longer, the really back I happen. just and think quarter, third components say We it that's that and of a which retail that going it's of quarter. minor, it's us going is million for quickly. when think quarter, the to $X portion It more fourth could the

meaningful a providing So guidance you time. range difficult this all just is at to

same-store you average, XXXX rate, occupancy you from not do our XX we've slightly. sense the about by on points the lease pull our expect goes we these chosen So think If lease what going occupancy charges a expectation if - We But is and our on down to a would lease-up is. in out our given I incurred down to think just comments I've after to just run of that. then I our be by basis on you at very same-store look these basis. - down go

of units. at all looked we've our So

quarter-over-quarter. it Our renewal retention has up and you've seen gone

it During XX%. I think pandemic, was the XX%

good. pretty This quarter, it was

that the the kind up done that's the come Hopefully, helpful. seeing we've in occupancy today with we're that upon that So have analysis portfolio. activity of views to we based

slightly different way. a to say Just that in

slightly way. say a just in it me different Let

how I happen to early at of we really when better be a to next not good can act. the going associated base perspective, the to with conversation the going with the don't XX across recovery in just terms going to with the position April, next from are which is variable but you, late we country in are to our hope we We feel, days how happen income. think from We're months that three in it the and We at portfolio what's good about to in May economy really have But variable what's now. of certainty don't know regards going six understanding we are to things not we get we're people in know. knowing pontificate a going and may or the

why that's with now. this sticking so And methodology right by quarter we're quarter

Deutsche Your of Derek Johnston from line Bank. comes next with the question

C-suite demand leasing decision science hesitant to biotech with TAMI making with commentary to companies being muted often seems that in maybe pretty welcome. a A life a more certainly big it work extent and a for bright bit including is spot was more lesser firm in home the But from guys tenants FIRE potentially in out during for people do and longer a and obviously, field XXXX a talk and bit? you or anticipate the meaningful seeing you And to in fire when about way? less reengage be pushed office potentially need What tenants Will term. space. are TAMI flexibility it

be Owen, soapbox to first? on the want you

unpack. Look, I Sure. There think there demand are is to you're things science few that The strong. correct. life

the sectors of are not. Some other

most the make for major more think less are reason leasing in and activity importantly, a businesses financial CEOs is recessions, slows down, that we're outcomes have I recession in uncertain and commitments, are to likely all which leases.

this no from recessions. different So prior is

a lags office bit. think I

dissipates, leasing virus is improvement. going later we're people you're to to the the going office economy and back when year in come probably activity So I clearly until stronger more the in get not to - think the

to home acknowledge said possibly we in I from impact do more and and work-from-home frequently. America basis remarks, in will the around workers the of part-time work believe my want that on a world, As

and our with interest that and their to acknowledge they that back see also the - employees see also but CEOs importance I we we in getting the with So in office. impact, see work think strong we their in-person

demand. save really by you office And home things. a So the of to working then basis, the on - having space at need do issue part-time additional part-time is, two okay, what's people to with on the impact work again,

the looking fix remarks, home have survey my Gensler you're everybody can't Friday. You And again, Monday more and preferences, of be a flexible office of is, people go out need out at I they because the them one move if is time the work to said stations said to around. want as on in they the work two, people you of or in workstations. that And employee of and to from XX% office to wanted surveyed schedule when

accommodated. So which will be preference employee

acknowledge is we it's again, overblown think impact for we but work-from-home, an reasons. those there So from

remarks. to a Appreciate I the worker because or does dedicated Appreciate. play a that mean, you. model. they office the not that devil's on they mean Thank workspace, of that just No. advocate survey employee especially granted you stick prefer say guys will wants just hybrid it. in or if Got an that, color. But mentioned I'd be demand let's

especially hot to or So the us an on, week A, seems allows over deep a that a B week potential desking solution cleaning model, in off weekend.

hot ultimately data to desking you, lead is believe guess you business what guys. conversations unlikely? I So like from leader Thank that

look, that say want accommodate as Look, I I - expressed and think survey workforces, employers to employee to Yes. you preference. talented all our mean, have we

going strongly with leaders have terms fixed in the employee to think business I out employee accommodate. interest preferences because country Working to more there talked leaders of preference. all employees are of workstation. having office that's business to across onboarding So an sort strong do I which they about I the of to to diminution competitiveness, a think other on is the going return talking in in is the culture, also creativity, try employees. home from want

to again is sort think to question this try going out, accommodate. are which are to to a employee that preferences have So going they I business leaders

the Your with Anthony next from question Paolone of JPMorgan. line comes

Thank you, Doug.

around it ultimately quarter, sounds pre-COVID? got a conversations hard You economics are Where a out, pipeline. going did mentioned do you know peg shake like you leasing to the versus rents of it's would and where of all-in the now lot to you've but kind in

excess you you I getting is current depends. in see in market we've what in. rents now right that like we in than dropped life in that of hearts, I have much. of a my done and the do it market. And the that depends the science San our I by I are to renewals that oriented can it we paying going But suburban all some are well in softness tell have portfolio higher Anthony, we're mean Boston heart really think and pre-COVID. in will on in our if we're those believe been it's unclear And all I tenants rents renewals markets Francisco, tell were

a answer, firm wish can't. just I I So could you give but I again,

now net not occurred face base are or in ask activity by up rents more calculation, people less cities, rents but rate if upon less are than you these Now, based that effective a or that's say, XXX down XX%, previously. it's the I you tell down right would versus rate a XX%, by would a again they

the you it's Boston. Is year I rollover decent have just you this anticipate in when all it likely XXXX, mean a portfolio that of the given spreads across amount I you'll have do done? and think positive said

leases rent The yes, will the answer mean Again all is, that's on we've I that gave a recently. have higher, data I had about the contractual an yes. be six that the think all the will what affirmative, the answer what why the that's on was rent be, I I done about that's deal So we basis. months been Not mean done versus rents would ago?

a capital And question on then the just side. allocation

there to complexity the And vehicle the how adds think say about JV markets, Just versus that Seattle are kind any selling do or in curious of there? acquisition it Company how overall you're the weigh as do not target you target route assets you in out terms or to the then capital? others is just raise of an only versus

have capital, in for on making growing touch we new investments significant I'll significant that makes and of ambition that. Company do sense So We have but shareholders. also the terms

extend with it the So we partners. capital equity makes think to sense we have do

tradition the Company. have rich this We of a in doing

cash investors CPP, have business is a of global estate we assets reasonably efficient if Makes leading of gain, way capital for real us the partnered like a think is extending it of Selling already lower. Most, And and all not an therefore, type tax a that's significant major requires to have not our dividend. We raise significant much sense. requires a special with and Norges portfolio that a lot which capital. of assets, retention or

ventures the services to other sense. all is, those are those I say the we providing joint on think So for ventures. thing joint reasons, would And makes property JVs the we

joint our venture to a of enhance yields result as the partners. providing do services we those So

it? the Thanks. piece And of Seattle then

Sorry.

only in right markets So would not we are we actively yes, I new that in at operation, where Seattle the currently is are now. looking investments terms of say market

from question comes of Citi. next with line Your Manny Korchman the

sort Mike on you perspective? exposure, those everyone from markets you down in just is accruals in to the terms can geographically where stream? of causing that it a those concentrated pause that remind the you're take co-working And co-working and of lockdowns income are

this is Doug, So Manny.

and Let let me, try me answer that question.

all bankruptcy. operator been we in approached of basically this the quarter Regus by put the last we've So relief about portfolio over regardless our units and saw into country every market

slow the now XX very we're pandemic this customers, digits, to In the months to into census work. which not come of back that digits to flexible it certainly probably operators' is leases But had many many been low-double seen. as it's short-term right. the and expired single clear of our census somewhere the space leases they've obviously, So pretty in from and dissimilar we said before we've are those high

recognizing revenue we challenges cash should just simply decided we a given that is rent credit be industry this facing basis. and deterioration So the on

Washington the have did XX two we California, I Jersey. And And was in rest the country, across New nothing in we we our New it. exposure square year one about reason our, $XX portfolio was have total, And XXX,XXX - in about did last in reduced the that actually we our by in do the portfolio, that DC we other York, million. Boston, over with with we've leases expired. So feet units three what and when in have regard think that to it's own in

what guys going looked time did. upon think particular we on So We're have these have time now, is we and at we just everything a do we about to specific based any are really deterioration, credit but to world this unit. the said, current right don't concerns any rough the the and

on or their for Thanks the with more less leases, build you you space space, about call more have physical sort with discussed as And either them they actually longer-term as then, thinking they seen we've plan, concept out their of new hoteling but just through trends, that. some going leases, are building space, XX is discussions that out today? XX-year that are of this changing topical how are

sort So calls. that a had this that their taken, sudden would tenants conversation could we spaces very the has few all that architects I the past in looking in industry are of have I I there been tenants tell their tell at changes can And transformational but you types. you and view across wish change design have in really

going to exception, the customer are going less, types are therefore, we to need that not we that rule anecdotally to strategy, find able a And for try be won't larger office to says, and you mean and breakout meeting doesn't different you do but the areas want that come know all of what, different people this to people workforce There individual the configured far Now, to that to of work-from-home and the a our their do the right date. spaces. part in that, all spaces of we're talking of rooms the types in making with longer-term about are and to it's have most but place again change the it's pre-pandemic. build-outs, leases anything because we in little tenants of portfolio as a our unique are have yet with now, And they're in seeing relative to usual it's business pandemic utilization way haven't relative surprised, out of fact. their way but I'm of seen to it. a We the that's how space. currently come going looking the they at just

the from of Feldman with Your Bank of America. question line comes next Jamie

into and CBD what either might and more hoping well are Virginia? was change in thoughts in in seen. on just guess, Democrats I markets Northern little some DC I dig a the Any out on the doing starting of to we've detail. budget post-election,

to want that you Peter, one? take and Ray So

start. I'll Yes.

and ahead Go Peter. ahead, Go talk.

typically, benefit, not certainly NIH, closer Well, is that's also and there since administration, as I positively market. Ray, 'XXs, as now and line, are going think talk the I in. Congress just stimulus, was it long always say, impacts spent? and about that to XXX where the the But but reenergizing the with the we're to here talk and that there's and Houses Quarter late and which the a real around gets indicate, estate going money downtown certainly How science occur life seeing it to think been when going FBI. having I the of would

a difficult right now. pandemic, been probably predict it's positive. the historically, a It's So just, to more given we are where little it's with

their to that. Jamie, just we're will they we're seeing and constructing is I headquarters change the for, Manny's that to pre-pandemic this point to from virtually work home prior think space they major employees tenants building. virtually of making And for but add about work. were more for yours we're Volkswagen, - four are actual Fannie, in And major the space buildings Marriott those new excited They're to back previously and excited getting to the and downturn all extremely in the about that motivation. Wilmar, demand are launching everybody to configurations relative DC, I four the new quite no plans no

years So one XX most we've Virginia XX Northern suburbs, had completed of in years. we in in the the successful or perhaps just

is sure there to as suburban we're impact portfolio, our not it. seeing a hell pandemic if So

more Reston type is product? what pipeline the Center for like look then And Town leasing

this So in space. running year. specifically Reston, available got probably lack XXX,XXX are out running the XXX,XXX we And feet square another of up for against in now proposals - feet, we're occupancy Reston, we've square

project point showing now about start our So where to physical we still got condition have Next. square on space. we coming new That with XXX,XXX is in RTC coming a a feet the

activity DC real will with the in that hopefully focused activity think continue we be related downtown. to suburban some So Biden

next really on shifting we I'm to you about And conditions? gears then all hear activity. that about guess, years, corporate how mean headlines drag of you the relocation have much of market to couple Area. curious think will the I the think a see as I Bay just

with start to want you that? Bob,

couple was not the is last recession. Corporations Area from Bay Oracle a that and the or someone Yes. of happens move there a this every years. time space was new big over taking occupier of space consistently

shedding space impact. In it little the So HP, very XX they've case I years. of the has been last think over

has So I little think impact. again it very

profitability, opportunities San with to of not can't and my see the waiting additional to lot a the companies And aspirations to because could. a earlier being of if know. is residential but So what people the to an at upside. amount stronger to the San have the orders We still companies that Francisco it And regards in on a said time tough Valley go shelter basically the because there that be relative help are certain these I are just that's have that associated at place able probably come and if there let's go so the well that opportunity looking happens my in Francisco. are the San additional a Silicon down, they the in of and understanding just going been. incredible have great in footprints labor available may ever changed. now And there very Jamie, now everyone they significantly not beta aspirations it, be moved have things affordability assuming they the Greater the side. work city significant to in with be before it's to very worst the revenue of that technology I in year, that of Street particular we're that, been remarks, expand what heck is really rents of we don't Francisco surprised the prepared has to what are you to picture, and recession is right And to asking is - looking there. happened that to than as in And the response say, going think and of happen been would this facts on And be technology will

thoughts. for very That's one's Okay. every helpful. Thanks

from comes Steve question the Evercore of line next Your ISI. Sakwa with

go Thanks. to targets million pre-leasing your starts. first, I development or development hurdles? that of projected changed have you are I to $XXX you Have a is to wanted changed them? yield just you and on but in guess the science, lot do potential starts extent life guess I expecting the what you back just those probably start projects Owen, I guess your

market redevelopment clusters. XXX with the with customers, speculative of Yes. development and Street be success Steve, prepared the right now, we're the Maybe West and would core had dialog on life we given having we that be the a a are to the our that these launch science, and in in heat of in some Life with we're signed come we will cautious market. confidence the we more more we with still we down, have but a requirements And lot X%. and lot not will before so - The for have be yield lot start, shooting office. would dialogs Science customers

So pure without a office launch pre-lease. we certainly wouldn't development,

lease mentioned level. How any like might have sense you about And be you $XXX Do do It at kind thinking you think guess Okay. yields then how million, similar or million. And are yields? are sales stack markets up? you sounds of would maybe sort $XXX say, I for terms, flavor sort these How sales? the the the cleared multi-tenant, have which of deals traditional of lease been are those with not long single-tenant, terms that think about or in credit these market, high really the more have we average of do market? day

are we want sell working assets this we Well, are out on we sorting year. already remaining to the that a Yes. and couple

the and the come our we in we have asset flat dividend these keeping past, are but more gains discussed we do suppressed from that sales, have income. we've As

select Steve, mix. the, to assets assets pay will will There'll gains be be consider we we a those used So I will regular non-core. that And think the be dividend.

earlier As achieved. comparables million that rates the meet other some I we being of and in described market think that are year And that pandemic. the you before be then, assets we've been selling those know, million the per $XXX there'll even of $XXX of terms cap will that

it'll So a I think be mix.

place side really rent contemplate that those it it of the cash you earnings you of up, at in It maybe reasonable all. Doug like a that And 'XX. rent on se for in maybe number but per that doesn't I spoke the tenants plus sounds on occupancy collecting does nor lot potential where you're currently contemplate are a are guess that not then, Mike, some about, guess, gave I decline and or accounting,

So how kind about $X.XX do those we two info and directions opposite number? in that between think going of

million income mentioned think XX the points, think you XXXX, if it's side, ancillary I in And a I talked it, vacated, about again I $XX is is right of basically on a back. is that which some Well, of and occupancy $XX if which it just that. about take is some is paying more million parking, could $XX little than might quarter get to million $X significantly hotel, million the which us is but impact not basis be retail, $X.XX. further which And now, bit

of of at, So it the store. I abatements occupancy outstrip now. timing in stuff had might We are kind depending the clearly any getting comes think, from we do They when are back, same in what tenants some on - on have could actually right that we that reduction occupancy. you're have

$XX those had So we million this tenants. of quarter

that think start tenants again. So who those we occupancy open, rent paying are in and will

those about on were GAAP not, probably that. them XX-XX it's now, were of Some some rent of right recognizing

we're as of to a get that rent in So are to million overall increase? part occupancy, basis in those and more $XX tenants next and contract year of place hoping back

Right.

some positive your mouth, have a as the direction? the maybe to potential outweigh not but of things decline occupancy to really in words So like potential to or put sounds outstrip those in start those move

deliveries towards starting normalize XXXX, when going to run you're there especially, returns lot to it's development pretty we XXXX even get we're I'd to because really you of to into have a and some have when and and expected delivering Mae, I on the further the do get both, got things on that going going rate certainly more we They growth for of described coming modest. that hopefully, full only is more in Yes. well online are $X.XX. Google, because say, a you're XXXX, delivering and Fannie stuff development as

is in year last kind So of in we'll stuff is that stuff and have in of a year the XXXX. thing later full that coming

there's on. a - again, things positive think, we've that lot of got is going a there lot I So

Morgan comes question next Your from of the Malhotra with Vikram line Stanley.

the Thanks taking questions. for

so - questions. two So maybe just

you not least occurring sort some on at versus we on to of is the what just sublease perspective just this sublease everything but cycles and out the is and cycle putting see market, tenants why seen interesting why are where just phenomenon? market mentioned that from First, sort the may have that I'm market, - hoping your of prior testing sticks, curious

this cycles on XX.X which other mean other in that City and New square have politicians million and are XX in they don't York and space to they're point have people about and feet are the to the their for between there We was sublet the also going I space open. cases absorption right. open XXXX, the are my because when was have go therefore, most of XXXX need that taken can comfortable employees are them to the regards spaces thing. to and the when other a been which with give - particularly that space to put There their sublet schools if months, because as-is feel different cycle off. the has kind It market, buildings million times are XX because perspective last back same not nothing the on traction of been than cycle is not to exactly that plans relative fact last seen to the other the there making was no even from than sure lot was public okay and was transacting going short know term many with are they an the

what put the space the on But just just That's space second. just - last it interesting. it Maybe sticks. who just back took they some as So kind of sublease then entire there economy of also corporates you improved. cycle were to as just see the say,

I the post-pandemic other or discount perspective the from plus of pursue persists, rate over five implied of cap at value, BXP's so whatever if to XX% exhibit markets the look afforded and call we a equity referenced sub-X% for the of sort I'm or market I just of either years, a always this wondering this some you BXP in NAV take to reasons, disconnect just assuming have private last are or the last what and X.X% years. markets You ways range. the actions - equity could strategy sort gap? five close trade And NAV, guess at you pre-pandemic kind for actions the versus to it

Vikram.

key to grow the the Company. is think I

values growth what NAV focused than and we're on. market that's more the think I

line next Piper question the Alexander comes of Sandler. with Goldfarb from Your

up there. there morning or down Good

more guys a on clearly, that places looking the growth are question Seattle in you a Owen, or got Austin Blackstone down at, mentioned So you've see back like first, mean Miami. lot at only looking buying you I that's market that you building but in Miami.

South worker preferences culture, Wall to Austin at certainly of what start et the those and do start as cetera, dynamics, become So looks attract more at et gets to a Texas point of markets Florida change an lot that some markets Miami, base, or and same like the Street to guys create you knowledge cetera? tech, would looking

Yes.

say. One, that Florida corporate to and is of relocation Alex, to things to acknowledge So we on most would couple there going some and South South recently Austin. activity I

you of little couple things. I Wall would more. dig I sure Street I Florida to South I'm as One, say So mean, I South. a not that bit describe got would into think

that not market, these some institutions big. have the I they think size actually in financial of the at if you larger looked requirements of that are Miami the

and a space of it's So it not not lot lot makes but headline, big it's employees. of a a

science think Florida I and one. - And that's look. this I in There no then, So about we is - acknowledge two, it, The is investment high as computer operate a with of true the doubt level do but cluster. Austin is is South in. the A space than much office for very new dynamics are market even it's that markets more elevated construction The and Class very vacancy different. and well. all we existing

but has on and investor. estate yes, also got on you've of coming a outcomes So as you've that an got the plenty supply real growth, impact

buys then you'd overall stuff the the we the the it low is dividend if Okay. They uncovered fun growth, range to us your meaningfully that would dividend. and no FFO necessarily AFFO, all companies. Owen, And be one then the deduct given that agree on to yield this implied for it second dividend. to for use suggest especially the I other the going Mike, probably question get year. dividend BXP relative for buy think to

the At will So your dividend that something under the at especially Board talk creation platform all come reduction value contemplate, guys potential a what where point development become as is does dividend science pretty in you about the point what does good? life reconsideration?

described dividend grow Look, our growth And back going growing that to dividend. call, and all we're this I existing to our is in given on our the opinion. and Mike goal have into Doug a stable and

don't that's the income. have online that's of Whether thought of significant pretty is is, mean, back. it the it back development XXXX, said which of we third know. I quarter going or revenue we we coming to step mean, Alex, it's additional is But absolutely quarterly Mike comes amounts absolutely just that I is I of now XXXX right in coming back bring there quarter it million not well, in back. $XX fourth that - and our numbers coming

real in to We hope the XXXX. our again, next our over five years, and the XXXX, confidence AFFO in our taxable in including late in income, in FFO, have three growth we

ability we're to have So our a significant about going we revenues I mean in way. confident what on and our increase

it further. I be cash burned of this rent flow the the that free anticipate sequential and quarter thing other in mentioned wouldn't the in would question in to are XXXX, we improve without would even on the a meaningfully to that's is uncovered income improve ancillary flows that there's necessarily XXX%. AFFO next Just off the going I XXXX. improvement and add the I going improvement ratio cash is, lot year same-store. is consider which our to FAD And that our and our that of there

So colleagues our I thinking dividend not with this agree that resizing time. about we're my at

next comes Truist line with Your Lewis from of Securities. Michael the question

some tenant and clearly on for Are tenants they picking the space about or different is, averaged renewing or front, are real on there that markets? not you're that question your trends So if retention wrong, footprint physical their guess eliminating XX%. are they're moving where tenants finding some I moving up like to out other that but me, my looks pre-pandemic? sublease going. It I'm XXXX are cutting the about maybe Correct any or that the are is question from

this future the we upon and by be plans anything by. is discouraged would natural can that or that Michael, out a It's based the I would the to point we think there's are. configured, of age space, Doug. don't was encouraged way that tenants be either move of it trend their what their

the And that depart kind of tenants the will tenants so of that will profile of whatever changes versus expect we stay in reason. in of much kind don't see for the the way to

likely notified And a the do a of In occupancy the return how how of half? And of trend words, office? the many you of year? have be other repopulation where portfolio you this to to in tenants second have physical at is rough might schedule the your date end

and be is a they effective And back having in in events and come there their to you session occurred in to those it's how will damage more terms of in will that and getting buses than to roll people know is scar into and the having person back. conversations and quarter, come So as are getting as XX landlord. talking months fourth the through end their early tissue the as over us the the back sooner seats things and third and schools out will confidence we that's the employees And that last that about colleges and quickly is notified the fall the later of the expect see particular has year couple that in the those if be location. dates nobody But second question will the to a the certainty those more you tell be the date date has the the quarter, they guarantee simply is quarter, that rather answer beginning of working, over company they What in athletic would XXXX. companies and is, of internally going vaccine weeks. past occurred upon depending the that far change particular I are say I and there that knowing that kids on of be be like that, around going the ask that

had active wish squeeze any come Are development in in more different, want or any that see space a anything there like I the risk to of those then, little could sublease there just want or confirm, tenants to plans a is portfolio one can. that maybe that maybe pre-leased. in I'll And if I they XX% done projects? back renegotiate unusual any their you just

to questions. no those all of Definitively

question comes sir. Okusanya of the next from Tayo is Mizuho Securities. And open line Your with your line

Your question comes the line Daniel of Green Street. from with next Ismail

in thinking with on as future I'm how agreements/ regarding might co-working this be experience does curious your change these the just leases structured tenants such the revenue-share

Yes.

I think it absolutely does.

it leases have in will makes appetite other look strategic with it with needs don't clear will with when what have space we explicit I a in our probably relative that - we're And these we going-forward lot for more stuff people sharing this buildings exposure do and do and a of that think specific current it it on of to doing is. ourselves. we'll be to this the and because, revenue future, therefore ourselves basis

trade in we've But permanent revert I'm science, your as post-COVID? A cap curious, cap change in life seen more underwriting historical across inside rates considering you footprint. a life this market office on rates valuation then or of this And your Class are does to science range a

gone in life lot a a markets the where driven that rents of years. over I have last think of the it's operate lot fact by science up a the we lot few

an think at creating to there lower and where look could the is, that's is rates. I you a rack If where asset, rates dynamic big existing that is when changes, the cap market So in cap back from roll-up rented the go up. it building

that to any capital likes stuff. is with a anywhere we and market of country word, dot. the There don't that's it is much the associated There's to particular need is have there that get of it. Owen hot not institutional scarcity lots use We it's some. factor the in And any saying, of in

of And is capital so looking that the supply and little in demand, supply, for right, of there is is it. there way lots relatively

a And for. so at is bid the moment, there strong very very,

with John line Kim from Capital BMO comes of the question next Markets. Your

follow-ups. to what The signed appetite of your couple to a up had just build eight-year this offer leases quarter is term, but had leases you I that occupancy? shorter-term

leasing tenant and we business a basis. tenant short-term lease, So will on are If if basis. will a a long-term in we transact a we of space, a wants the on long-term transact a John, wants lease, short-term

We what to do are want we to and customer-centric customers do. want our

short lot pointing we've of don't that is had we we've do forget - don't been long those about, the Doug If a as extensions talking generally leases. out that And Yes. again, think success CapEx. you're I have in doing

tenant in the So lease also over is term, extending essence attractive. we longer work are which a

short-term as trend lower longer-term or are of the cycle, we shorter So economic leases, given do where solution CapEx? that in you a view could this be a

are opportunistic Those been motivations. much to of do world time out market mean has customers correction a and and appropriate. I capital an I think long-term lots think that this with you who it's long have of they going there for different for a extend customers kinds very say, us can to are as get going is as possibly as want lease. of of the landlord we think in to customers as they the there to different are kind

- in going our I to at decision. clear and our to more current of about permanent a not So to is how saying, when some to we're years we're not we'll more able that's there and capital group years, look workforce perform our We more it we'll unsure, XX strategy. make it's confidence to that's think XX business relative is another tenants cases, us for have again the clarity kick or then XX be and want months two just to can then, decision

offices, think dramatically, and going this just I don't to ramp-up the again, other scar I to framework. the their decision-making have always to a not referred than, their tissue I together to that's people the just been change think of things going change going it's year the and going I back way time length in to, due be it, think slow on associated it's with are

and quarter I I'm tenants think wanted deferrals of then, peak more Mike, clarify what in as offering rent sounds terms like you're well fourth you just the with see during And going going you. Do wondering abatements? rent to to It the the year? start are be being but you've paying if you as to some offered in relief rents quarter again,

will we be time next We period that the restaurant of that's hope of improvement. say I of I have the be certainly that an so. mean when many through kind expectation maybe we're there'll will our going kind it of because tenants summer when

come there is I the not tenants know we be going million occur there next to $XX what - think it's today, left those additional XX dollars say million at of are those of lot Based over $XX will we of to is going never So couple of never we've And XXXX. because that quarters. the to tenants. this you tenants of during about care on I point, about is again, taken can you there a whether but not are - guess

Abraham comes of question next with line from Peter Your Jefferies. the

comments to just the Owen's beginning. go I at wanted back to

out I recession same the were, leasing we the used and third But still at quarter. words lot makes second in of office-using of we're time, a which significant predictable a you and and had improvement coming sense think coming been have base think off conditions most activity, the the I the jobs lost. in

and that curious impacts So kind where outlook 'XX? your 'XX - your returning and of growth I'm thinking for the job your how how just outlook contemplates for

Yes. those less and No. economy. was I And one not a predictable. - maybe a it's and I words driven chose pandemic Look health It's and the cyclical this the guess a crisis. the is, been cycle it's of think I difference carefully move interesting been by in - driven been by

about out harder the I with theater so our to come recovery, to pretty obvious to to this restaurant to world there if tired progress, back. think something that maybe offices easier something a I come and an the unlike one with this think see knock there think I the goes reopen to or perhaps and wood, to and vaccine the Again, again, return other, months. is is six And but a on all on, isolation really world going as the of which we're in is and wrong are that is economy maybe sees of roll and out economic and all this vaccinations essence and slower to is predict. in of predict, goes each jobs or is vaccines, getting going I us next correction the And the to over think we

to all the I businesses think get of that this. small as and of all part will reopen restart

we do Look think, in economic have office a year, to this leasing improvement we're lag tends going that. So activity. to significant

of So result. this quarters we also think do the by the office elevate that later will year, activity as a

Your from Korchman question Manny next comes the Citi. with line of

It's Michael Bilerman here with Manny.

environment. Properties just employees Doug, of I vaccinations, wanted thinking A, of are One, assets requirements: thinking force just you your public know in coming sort in two to competitive are terms terms on topics. are any Boston they building staff, of for vaccine, I it to talk I safe places? out guess of to can't roll So contractors, off just but tenants And tenants, sort you making how wondered, your feel I comfortable how your vaccine the about coming and into about you adheres

to want you that? hit Doug,

Yes.

So response an Michael, that. I'll give you undiscussed to

people the requirement won't something it's in vaccine. have from we we hard will view, people we effective in to have So virus duty, our are is get vaccine And that ramifications vast on I the the vaccine, the haven't that basis, to something what if rigorous its that really it, the have done the not understanding get about it's to but the our there tenants will talk think, going-forward but eradicate go the and the a worry that to thought people which the about. are, not vaccine get that but it's of the who won't issue not buildings and vast a of of we particular effectively majority about the majority marketplaces, is

economic offices, analogy are bit an their that still not People The then, space on, is going in the you offices talked And giving about a similarity a were the 'XX, for are York. to crisis there Doug, and but do GFC we 'XX going the difference in GFC big where little New sublease that's today. people their people and right. is between not today, the and have

have of real You've provides amount more in as and that you discussions of significant a a in though much what sublease and amount impact all working. opportunistic? a the you is things, the full today that being about the feel I certainly more more aren't footage around a like won't gives this remote advancement to them, confidence office U.S., you it people that And as lot discussions it's doesn't think hybrid love but It remote the feels lot love and with about of corporations the it space material have they new environment? the working the because need square interactions going in

get I the businesses start will missing of for social the But work, way think more be in I people the am a of guess in-person you're office questions back employees are employers lots in is to a more businesses. start from fair capital bandwagon. fear growth and work moment. treat that have business they asking individuals there unknown much to a all saying the become the relative the believer Owen of out opportunities the people requirements of the clear the to as nature the and Again, I every of the back to and have in perspective, week. not their and the are go of seat answers won't am will lot critical be I to that to that that of our from more how growth flexibility people, intuition to on is guess talked those both and and strong of day a it I and about at single that I and

see it's on the more clearly is But the think to very way. be than the a I to be of disruptor stocks. in And people and CBD having to questions back into don't work that your going value are about significant optimistic certainly headwind? going radical I value Absolutely. I baked in so will office margin, a that is the guess people it ultimately going I'm suggesting think Again,

and be trying I'm to the space person. trying making. looking at not balance I'm a sublease we And of pessimistic do but Right. comment How 'XX than different understand the points sort complete you think... just sort you're and of feels about that I where back, today, 'XX, coming to sit the

space. Let real-life me sublet two you examples just of give

Okay.

moved a So installation on always Mizuho on space their sublet market. was on planning putting the which new Avenue into Fifth

I space market. going is spaces any because competitive to don't think Okay. be on other sublet the that of longer

Is going don't to be So it Yes. actionable? I available? it going know. a to is sublet be it's space,

have because if additional they have the the think they people put space space space. the the that to they sublet from market, I BlackRock, when expectation they sublet don't they and you always market them I ask put lease took had had on sublet would they their doing some were planned space know short-term if on

of on last well lot So has same it for square a at quarter it management are time in of there the saying, Facebook they're think in what stuff take time. in have be organization going think don't from people much that is Dropbox must XXX,XXX there people Seattle. the of and working oh, things more REI that There philosophy as San in as just and the to and to do can building all We side But look Dropbox that tenants the just at that that workforce people there either new looking are we the a marketplaces. home. Amazon I change is this space doing contrary of that's in of table feet Francisco. decided you saw at is Boston. saw there Sure, take as

directional it's conclusion. think to I again, make So a hard very

they we're the there they of time they think that say, in What them moved, into decision, called may pretty come office decision job cadence given to do in March your of and do terms return that at assume maybe hey, then, corporations get And the is the the places, in being would going else. of the really I'm of that a a go here, like going you the a workers time back amount corporation people have back office? give I come if How what, go that and long and or when think they right? today is a markets their you made have people to back, to delay different say, to making in ultimately when cadence somewhere workforce are to different lot I

want you Owen, to take one? that

environment the now. to until And from recovered is the they've they're is infection but think from needs If premise as be back this are vaccinated this will safe. immune key I companies will, where work. push I precipitously our to is, They - that Yes. going Sure. on think going that's believe in-person it drop we've couple employees people a described rate morning employers times want infections. I the their it get think of it on, And don't more more people because Look, successful more and their therefore,

are want going to because think is, So be do employee when deemed how then our to we I push safe, I it think back dilemma, okay, companies it's which that to and Michael, the faced described, we hard be going with you base. people

they of work the want to I Some and to certainly think the be home do out out out they of from office more. full-time, want of but of be office. employees want to they these don't the the like be office

my from lot infection assumption we each companies is So see do retention And I these what to with, our will think those with home. kind up have to make back requiring work. the I should put what going comfortable terms more differently. as employers goes policies in-person are in come down think rate company companies in decide you'll think talent. industry to over balance work of that do of competitiveness to again, And are I competitive think to a do summer, I different of different policies issue, going work is what to be to the we be decisions employees to will and But need and we around this this have

like being now restaurant would I vaccinated basically and being of that is And employee a in human to Michael, The they eat, the that is if okay. said, an to human say, - if over. have going to being stigma a population is

And back difficulties going so types beings dissipated going to are in and have human they close have very that your they of work more are and employees of things that occurring, way. clear demonstrated as a to see be it's quite other with to because in comfortable we come to asking are associated to more being around going approximate those the

the believer sick virus. in are get you and is vaccine to what of vaccine If you're a the really you designed efficacy do, contact the with it in don't is does if the which

we've we have to seats, desire this have are going is think possible, position transportation, which we apart pandemic their should come people were stronger of have coming and as back. going is are, to people that at we a the intellectually public people containment, for where people trying last Again that least to in far comfortable where the remain right, work get because all in as been desire once months. we going programmatic a there XX we're in which a keep and to to they governmental for as be to opposed put people saying, children back think things are solved been those on school, are to back I issues, now other where impediments to

Monday. one's would back, do ratification getting to timing given so a employees was asking decision it how of of it, their the - Friday, and people make on what safe, we the like is now on they've the office. it's Right. is deciding, can can been through think other fundamentals, that there okay, then, long I not slow corporate trying every the there just just build I on expect out a And I know to all on pretty leasing, don't sources. income

long right. they So - come more efficacy, And had point for trying with if I I It's as that if as direction.. corporations last into up I'm that the all the are distribution switch, to move all given flipped about no all opt-out, thinking right. it's just their this the They're plans. at we assume trying How vaccine this given, about insights know and didn't longer up could just you to

think a work. surprise doing don't people their back employees. is we of over preview I anticipate coming We the it Michael, anybody give when and should lot going world how to to to I we're try mean, ourselves. see

I that help So in this will think repopulation that you described.

Tayo of line next question with comes from Your Okusanya Securities. Mizuho the

Yes.

that hear me? earlier. about Can Sorry you

We Yes. you. hear can

right. All Perfect.

you've Just running of dispositions a I about seen target? bit year, quick your regards of and in thinking just pricing, you're a how little talk we're next uses also about one. leverage to given know capital you some long. Could XXXX asset what in

elevated the opening mentioned an that that's million XXX And us at least as we sold Yes. of into assets No, over going anticipate remarks, five in for million minus I level XXXX. XXXX we in between $XXX or my six and last $XXX years. or level plus

on a have We now. we're of couple assets working

the assets around conditions I and with year. on think office should I favorable, us that certain are selling As capital for described, level for reasonably market count you characteristics, particularly this

run perspective, is appropriate haven't Company. a our from on leverage Tayo, And think to the changed leverage the we that views we

our supplemental, but that this of this between the is I leverage that's then, higher is debt The at this because somewhere about. mid-Xs bit the if quarter, we at is because we've it charges of EBITDA took the year in mid-Xs And annualizes the our basis. reported some obviously on calculation quarter. look leverage the little items X.XX think income the to a talked that net you

the over we've income that coming we've in next described been the pipeline. So of already charges, the effective we've past. range that couple you development pipeline money describes in. development lot years from we of a for amount spent has got the within that that then, that which are pull have operating provided And the is of described A significant in X.XX, leverage and a footnote comfortable the if we that out

delever will the years. over naturally that next couple So us of

We of with for Skidmore time have that one Goldman comes the Rick and from Sachs. final line question question

we about And thinking about anything taxes we just regards estate how in modeling be thinking are then, what the real should estate taxes? XXXX? with a quick How they're forward, maybe cities Mike, given real you. Thank Thanks. question. go seen to from hearing as we've you

This Linde. Rick. Hi, Doug is

market exactly the by obviously, referendums we that of because pass. to happen So right? market, legislative In what's going didn't know California, it's

five-year in that a down. that of. go City, In but know changes going assessments period sort York, what's going taken New York with am is those New We happen tax I So as everything one care of sure occur. rate, is way over bled to to are in won't of the time

our real this In a market expect is like the actually in would been addition significant way have year-to-year, think so the similarly, a where have significant The So Greater term, to quite don't revenue issues, there of obviously, that significant. it's rate a but taxpayers of portion our much not bear of the in see the gone taxes supply I that, going impact have versus is detractor much tri-year been cities tariff don't net-net, and or to going change, in but And Boston, it DC the we meaningful being challenge. to big to some assessments there's I we'll, you're it's evaluations the a.k.a., fiscal area, that have in rises jurisdiction margins reduced very they it's real in it its because estate base. difference been to see think I evaluation mean mean estate not in I to has up, district so very be But actually unless clear that don't extent you a we building much it's hasn't looking in revalued. a see short the way. what to the be in more

escalate leases taxes rolling. have we real doesn't back And obviously, us unless to an so our estate we have tenants, or vacancy our to tenants, come we our increase

every actually that us small of to So a only increase portion comes year.

to call speakers remarks. would closing any turn to back I the like for And now the over

you the your Properties. Thank very comments and Boston much. That call, Thank questions. our Thank concludes you, interest in everyone, you, operator. all for

and have This Boston attending conference concludes you today's call. again good Properties day. a Thank for