Boston Properties' Q4 Revenues and FFO Miss Estimates

Core Insights - Boston Properties Inc. (BXP) reported a fourth-quarter 2025 funds from operations (FFO) per share of $1.76, missing the Zacks Consensus Estimate of $1.80 and reflecting a 1.7% decline year over year [1][9] - The company's quarterly results showed improved revenues year over year, but higher expenses negatively impacted performance [1][9] Financial Performance - Quarterly lease revenues reached $809.2 million, a 1.4% increase year over year, but fell short of the Zacks Consensus Estimate of $814.7 million [2] - Total revenues increased by 2.2% from the prior-year quarter to $877.1 million [2] - For the full year 2025, BXP reported an FFO per share of $6.85, which was below the Zacks Consensus Estimate of $6.90 and down from $7.10 in the previous year [2] Revenue Breakdown - Rental revenues for the office portfolio (excluding termination income) were $810.3 million, up 1.7% year over year [3] - The hotel and residential segment reported rental revenues of $17.6 million, a 1.4% decrease year over year [3] - Consolidated rental revenues (excluding termination income) totaled $827.9 million, reflecting a 1.6% year-over-year increase [3] Operating Metrics - BXP's share of same-property net operating income (NOI) on a cash basis was $454.2 million, a 1.3% increase from the prior-year quarter [4] - The share of EBITDAre (on a cash basis) as of December 31, 2025, was $461.6 million, down 3.1% from $476.4 million a year earlier [4] - Occupancy for in-service properties increased by 70 basis points sequentially to 86.7%, but declined by 80 basis points year over year [4] Expense Analysis - Rental expenses rose by 5.1% to $339.7 million [5] - General and administrative expenses surged by 16.3% to $37.8 million [5] Portfolio Activity - BXP completed the sale of four land parcels for a gross sales price of $141.3 million and two residential projects for $407.5 million in Q4 2025 [6] - The company also disposed of non-strategic offices for a gross sales price of $341.5 million [6] - BXP acquired 2100 M Street in Washington, DC, for $55 million, with plans to redevelop it into a 320,000-square-foot premium workplace [7] Balance Sheet Position - As of the end of Q4 2025, BXP had cash and cash equivalents of $1.48 billion, an increase from $861.1 million as of September 30, 2025 [8] 2026 Guidance - BXP projects FFO per share for Q1 2026 to be in the range of $1.56-$1.58 and for the full year 2026 to be between $6.88-$7.04 [11] - The Zacks Consensus Estimate for 2026 FFO per share is currently at $7.01, which is within the guided range [11] - The company estimates a change in same-property NOI on a cash basis (excluding termination income) to be within 0.50% for 2026, with average in-service portfolio occupancy expected between 87.5%-88.5% [12]