Boston Properties offers discounted 9.5x forward FFO exposure to a recovering trophy-office cycle, with occupancy gains and development deliveries counterbalancing leverage and refinancing risk.
Overview
Boston Properties is the largest publicly traded owner, developer, and manager of premier workplaces in the United States. Its 164-property, 51.1-million-square-foot portfolio is concentrated in Boston, Los Angeles, New York, San Francisco, Seattle, and Washington, DC, with 91.0% of rental obligations in CBDs. Lease revenue contributes more than 90% of consolidated revenue, supported by a 7.6-year WALT, 91.3% leased rate, and 88.4% occupancy. **Q2 2026 showed improving operations:** normalized FFO was $1.78 per share versus $1.71 consensus, revenue was $895.7 million, same-property NOI rose 3.5% year over year, and occupancy increased 100 basis points sequentially. Management raised 2026 FFO guidance to $6.99-$7.05 and targets 91% occupancy by the end of 2027. **Valuation remains discounted:** at $66.69, BXP trades at approximately 9.5x midpoint 2026 FFO of $7.02 versus a historical 12x-14x range and offers a 4.17% dividend yield on a $3.92 annualized dividend. Catalysts include development deliveries, occupancy gains, easing rates, and $1.9 billion of planned asset recycling, while the main offsets are 7.94x net debt-to-EBITDAre, refinancing at higher coupons, and $500 million of leasing capex.