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Boston Properties, Inc. ( BXP - Analyst Report ) recently announced that it has closed the acquisition of 100 Federal Street in Boston, Massachusetts for a total consideration of $615.0 million. The property was bought from an affiliate of Bank of America and the company has also entered into a long-term lease for approximately 787,000 square feet of space with the affiliate.
Boston Properties funded the acquisition through cash and the company expects to incur $700,000 in acquisition-related costs, which will be spent in the first quarter of 2012.
The property is favorably located in Boston's Financial District covering an entire city block and has occupancy of 93%. The 37-storey premium Class A office tower with approximately 1,305,000 square foot of rentable space is an important acquisition for Boston Properties. With this deal, Boston Properties strengthened its presence in the Boston Market.
Boston Properties reported fourth quarter 2011 FFO (funds from operations) of $179.3 million or $1.21 per share compared with $89.9 million or 64 cents per share in the year-earlier quarter. Fund from operations, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income.
Massachusetts-based Boston Properties, Inc. is a fully integrated, self-administered and self-managed real estate investment trust (REIT) that owns and develops one of the largest first-class office portfolios in the U.S.
Boston Properties has a strong and dedicated management team, which is one of the most respected and accomplished in the industry. The company benefits from the reputation and relationships of its key personnel with the industry as a whole, which further help in attracting profitable business and investment opportunities.
Boston Properties currently retains a Zacks #3 Rank, which translates into a short-term Hold rating. We are also maintaining our long-term Neutral recommendation on the stock. One of its competitors, Vornado Realty Trust ( VNO - Analyst Report ) also holds a Zacks #3 Rank.
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