Boston Properties’ Q3 income drops 17%

REIT executives eye late 2021 for tenants to return to offices

National /
Oct.October 28, 2020 12:50 PM
Boston Properties CEO Owen Thomas (Photo by Axel Dupeux)

Boston Properties CEO Owen Thomas (Photo by Axel Dupeux)

Boston Properties’ income declined about 17 percent in the third quarter, and executives don’t expect tenants to return to their offices in large numbers until late next year.

Net income for the quarter totaled $89.9 million, down from $108.7 million the same time last year, the company reported Tuesday. Growth declined due to income drops in the real estate investment trust’s hotel and office sectors. Office occupancy dropped the most in New York City and San Francisco.

Company CEO Owen Thomas said on the firm’s earnings call Wednesday morning that Boston Properties collected 99 percent of office rents in the third quarter.

He said that in New York City, about 16 percent of the company’s tenants were back working in their offices, and the landlord expects companies to return in more meaningful ways in the second half of 2021, depending on when a vaccine for the coronavirus becomes available.

But he added, the vaccine is “unlikely to be a silver bullet.”

Aside from a 110,000-square-foot renewal at the General Motors Building and another deal at 399 Park Avenue, discussion of the Manhattan market remained relatively light.

Boston Properties executives discussed demand for life sciences properties around Boston, leases at their Virginia properties and the spectre of sublease space hitting San Francisco.

“There’s absolutely more sublet space in October 2020 then there was in March 2020,” said company president Doug Linde.

Linde added that the company had “made some progress” with Ann Taylor parent company Ascena Group, which owes millions of dollars in rent for its office space at 7 Times Square.





    Related Articles

    arrow_forward_ios
    Boston Properties CEO Owen Thomas and 360 Park Avenue South (RER, CBRE)
    Boston Properties closes on Midtown South office building
    Boston Properties closes on Midtown South office building
    Boston Properties nabs $1B loan at 601 Lex
    Boston Properties nabs $1B loan at 601 Lex
    Boston Properties nabs $1B loan at 601 Lex
    Boston Properties’ Owen Thomas, Vornado Realty Trust’s Steve Roth, Paramount Group’s Albert Behler, SL Green’s Marc Holliday and Empire Real Estate Trust’s Tony Malkin  (iStock, slgreen.com, vno.com, paramount-group.com, esrtreit.com, LinkedIn)
    Office landlords profess optimism despite dip in occupancy
    Office landlords profess optimism despite dip in occupancy
    Food52 CEO Amanda Hesser, Rudin Management president Eric Rudin and 1 Dock 72 Way in Brooklyn (Getty, Rudin)
    Rudin’s Dock 72 notches Food52 as second tenant
    Rudin’s Dock 72 notches Food52 as second tenant
    Vice Media CEO Nancy Dubuc, Rudin Management's Bill Rudin and Dock 72 (Getty)
    Vice plans move to Rudin’s Dock 72
    Vice plans move to Rudin’s Dock 72
    Boston Properties CEO Owen Thomas (Thomas by Axel Dupeux, iStock)
    Work-from-home threat “overstated,” Boston Properties CEO says
    Work-from-home threat “overstated,” Boston Properties CEO says
    Gotham Organization Chairman Joel Picket with the proposed development at 130 Felix Street. (Getty, 130 Felix)
    These projects just beat the rezoning deadline
    These projects just beat the rezoning deadline
    Boston Properties CEO Owen Thomas and 360 Park Ave South (Thomas by Axel Dupeux, 360 Park Ave South via CBRE)
    Boston Properties to acquire 360 Park Ave South ground lease
    Boston Properties to acquire 360 Park Ave South ground lease
    arrow_forward_ios

    The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

    Loading...