v2.4.0.8

Real Estate Activity During the Six Months Ended June 30, 2013 | 6 Months Ended
--- | ---
Jun. 30, 2013
Real Estate [Abstract] |
Real Estate Activity During the Six Months Ended June 30, 2013 | Real Estate Activity During the Six Months Ended June 30, 2013 Acquisitions On February 6, 2013, the Company completed the acquisition of 535 Mission Street, a development site, in San Francisco, California for an aggregate purchase price of approximately $71.0 million in cash, including work completed and materials purchased to date. When completed, 535 Mission Street will consist of a 27-story, Class A office tower with approximately 307,000 net rentable square feet of office and retail space. The Company has commenced development of the project. On March 26, 2013, the consolidated joint venture in which the Company has a 95% interest completed the acquisition of a land parcel in San Francisco, California that will support a 60-story, 1.4 million square foot office tower known as Transbay Tower. The purchase price for the land was approximately $192.0 million. On February 7, 2013, the partner in the joint venture issued a notice that it was electing under the joint venture agreement to reduce its nominal ownership interest in the venture from 50% to 5%. On February 26, 2013, the Company issued a notice to the partner electing to proceed with the venture on that basis. As a result, the Company has a 95% nominal interest in and is consolidating the joint venture (See Note 9). The joint venture has commenced construction of the initial phase of the development consisting of building the project to grade. On March 29, 2013, the Company completed the acquisition of a parcel of land located in Reston, Virginia for a purchase price of approximately $27.0 million. The land parcel is commercially zoned for 250,000 square feet of office space. On April 10, 2013, the Company acquired the Mountain View Research Park and Mountain View Technology Park properties from Boston Properties Office Value-Added Fund, L.P. (the "Value-Added Fund") for an aggregate gross purchase price of approximately $233.5 million. Mountain View Research Park is a 16-building complex of Office/Technical properties aggregating approximately 604,000 net rentable square feet. Mountain View Technology Park is a seven-building complex of Office/Technical properties aggregating approximately 135,000 net rentable square feet. The following table summarizes the allocation of the aggregate purchase price of Mountain View Research Park and Mountain View Technology Park at the date of acquisition (in thousands).
Land | $ | 126,521 |
Building and improvements | 82,451 |
Tenant improvements | 7,326 |
In-place lease intangibles | 23,279 |
Above-market rents | 843 |
Below-market rents | (7,336 | )
Net assets acquired | $ | 233,084 |
On May 31, 2013, the Company's two joint venture partners in 767 Venture, LLC (the entity that owns 767 Fifth Avenue (the General Motors Building) located in New York City) transferred all of their interests in the joint venture to third parties. 767 Fifth Avenue (the General Motors Building) is a Class A office property totaling approximately 1.8 million net rentable square feet. In connection with the transfer, the Company and its new joint venture partners modified the Company's relative decision making authority and consent rights with respect to the joint venture's assets and operations. These changes resulted in the Company having sufficient financial and operating control over 767 Venture, LLC such that, effective as of May 31, 2013, the Company accounts for the assets, liabilities and operations of 767 Venture, LLC on a consolidated basis in its financial statements instead of under the equity method of accounting (See Notes 5 and 9). The following table summarizes the allocation of the aggregate purchase price of 767 Fifth Avenue (the General Motors Building) at the date of consolidation on May 31, 2013 (in thousands).
Real estate and related intangibles recorded upon consolidation |  |
Land | $ | 1,796,252 |  |
Building and improvements | 1,447,446 |  |
Tenant improvements | 85,208 |  |
In-place lease intangibles | 357,781 |  |
Above market rents | 101,897 |  |
Below market rents | (239,641 | ) |
Above market assumed debt adjustments | (192,943 | ) |
| $ | 3,356,000 |  |
Debt recorded upon consolidation |  |
Mortgage notes payable | (1,300,000 | ) |
Mezzanine notes payable | (306,000 | ) |
Related party notes payable | (450,000 | ) | (1)
| $ | (2,056,000 | ) |
Working capital recorded upon consolidation |  |
Cash and cash equivalents | $ | 79,468 |  |
Cash held in escrows | 2,403 |  |
Tenant and other receivables | 7,104 |  |
Prepaid expenses and other assets | 4,269 |  |
Accounts payable and accrued expenses | (2,418 | ) |
Accrued interest payable | (175,802 | ) | (2)
Other liabilities | (6,304 | ) |
| $ | (91,280 | ) |
Noncontrolling interest recorded upon consolidation |  |
Noncontrolling interests | $ | (520,000 | ) |
Noncontrolling interests - working capital | 36,512 |  |
| $ | (483,488 | ) |
Net assets recorded upon consolidation | $ | 725,232 |  |
_______________ (1) The Company's partner loans totaling $270.0 million eliminates in consolidation. (2) The Company's share of the accrued interest payable on the partner loans totaling approximately $105.5 million eliminates in consolidation. Mountain View Research Park and Mountain View Technology Park contributed approximately $5.2 million of revenue and approximately $(0.3) million of earnings to the Company for the period from April 10, 2013 through June 30, 2013. 767 Fifth Avenue (the General Motors Building) contributed approximately $22.6 million of revenue and approximately $0.4 million of earnings to the Company for the period from May 31, 2013 through June 30, 2013. The accompanying unaudited pro forma information for the six months ended June 30, 2013 and 2012 is presented as if the operating property acquisitions of (1) Mountain View Research Park and Mountain View Technology Park on April 10, 2013 and the approximately $24.4 million gain on consolidation and (2) 767 Fifth Avenue (the General Motors Building) on May 31, 2013 and the approximately $363.4 million gain on consolidation, had occurred on January 1, 2012. This unaudited pro forma information is based upon the historical consolidated financial statements of the Company and should be read in conjunction with the consolidated financial statements and notes thereto. This pro forma information does not purport to represent what the actual results of operations of the Company would have been had the above occurred, nor do they purport to predict the results of operations of future periods.
Pro Forma (Unaudited) | Six Months Ended June 30,
(in thousands, except per share data) | 2013 |  | 2012
Total revenue | $ | 1,119,893 |  |  | $ | 1,065,877 |
Income from continuing operations | $ | 147,627 |  |  | $ | 508,812 |
Net income attributable to Boston Properties, Inc. | $ | 154,077 |  |  | $ | 501,060 |
Basic earnings per share: |  |  |
Net income per share attributable to Boston Properties, Inc. | $ | 1.00 |  |  | $ | 3.33 |
Diluted earnings per share: |  |  |
Net income per share attributable to Boston Properties, Inc. | $ | 0.99 |  |  | $ | 3.32 |
Developments On March 22, 2013, the Company completed and fully placed in-service Two Patriots Park, a Class A office redevelopment project with approximately 256,000 net rentable square feet located in Reston, Virginia. On April 25, 2013, the Company commenced construction of its 601 Massachusetts Avenue development project totaling approximately 478,000 net rentable square feet located in Washington, DC. On June 14, 2013, the Company completed and fully placed in-service 17 Cambridge Center, a Class A office project with approximately 195,000 net rentable square feet located in Cambridge, Massachusetts. Dispositions On February 20, 2013, the foreclosure sale of the Company's Montvale Center property was ratified by the court. As a result of the ratification, the mortgage loan totaling $25.0 million was extinguished and the related obligations were satisfied with the transfer of the real estate resulting in the recognition of a gain on forgiveness of debt totaling approximately $20.2 million. The operating results of the property through the date of ratification have been classified as discontinued operations on a historical basis for all periods presented. On June 28, 2013, the Company completed the sale of its 303 Almaden Boulevard property located in San Jose, California for a sale price of $40.0 million. Net cash proceeds totaled approximately $39.3 million. 303 Almaden Boulevard is a Class A office property totaling approximately 158,000 net rentable square feet. Because the Company entered into the related purchase and sale agreement on March 28, 2013 and the carrying value of the property exceeded its net sale price, the Company recognized an impairment loss totaling approximately $3.2 million during the three months ended March 31, 2013. As a result, there was no loss on sale of real estate recognized during the three months ended June 30, 2013. The impairment loss and operating results of this property have been classified as discontinued operations on a historical basis for all periods presented. The sale of this asset caused the Company to reevaluate its strategy for development of its adjacent Almaden land parcel, which can accommodate an approximately 840,000 square feet office complex. Based on a shorter than expected hold period, the Company reduced the carrying value of the land parcel to its estimated fair market value and recognized an impairment loss of approximately $8.3 million during the three months ended March 31, 2013. The Company's estimated fair value, as measured on a non-recurring basis, was based on comparable land sales. The Company has determined that its valuation of the land falls within Level 3 of the fair value hierarchy, as it has utilized significant unobservable inputs in its assessment. The following table summarizes the income from discontinued operations related to Montvale Center and 303 Almaden Boulevard and the related gain on forgiveness of debt and impairment loss for the three and six months ended June 30, 2013 and 2012 and the gain on sale of real estate and income from discontinued operations for the three and six months ended June 30, 2012 related to the Company's Bedford Business Park properties which were sold on May 17, 2012:
| For the three months ended June 30, |  | For the six months ended June 30,
| 2013 |  | 2012 |  | 2013 |  | 2012
| (in thousands)
Total revenue | $ | 1,529 |  |  | $ | 3,263 |  |  | $ | 3,376 |  |  | $ | 7,784 |
Expenses |  |  |  |  |  |  |
Operating | 656 |  |  | 1,489 |  |  | 1,486 |  |  | 3,392 |
Depreciation and amortization | — |  |  | 907 |  |  | 596 |  |  | 2,310 |
Total expenses | 656 |  |  | 2,396 |  |  | 2,082 |  |  | 5,702 |
Operating income | 873 |  |  | 867 |  |  | 1,294 |  |  | 2,082 |
Other expense |  |  |  |  |  |  |
Interest expense | — |  |  | (649 | ) |  | (360 | ) |  | (1,294 | )
Income from discontinued operations | $ | 873 |  |  | $ | 218 |  |  | $ | 934 |  |  | $ | 788 |
Noncontrolling interest in income from discontinued operations – common units of the Operating Partnership | (88 | ) |  | (23 | ) |  | (94 | ) |  | (84 | )
Income from discontinued operations attributable to Boston Properties, Inc. | $ | 785 |  |  | $ | 195 |  |  | $ | 840 |  |  | $ | 704 |
Gain on sale of real estate from discontinued operations | $ | — |  |  | $ | 36,877 |  |  | $ | — |  |  | $ | 36,877 |
Gain on forgiveness of debt from discontinued operations | — |  |  | — |  |  | 20,182 |  |  | — |
Impairment loss from discontinued operations | — |  |  | — |  |  | (3,241 | ) |  | — |
Noncontrolling interest in gain on sale of real estate, gain on forgiveness of debt and impairment loss from discontinued operations – common units of the Operating Partnership | — |  |  | (4,052 | ) |  | (1,806 | ) |  | (4,075 | )
Gain sale of real estate, gain on forgiveness of debt and impairment loss from discontinued operations attributable to Boston Properties, Inc. | $ | — |  |  | $ | 32,825 |  |  | $ | 15,135 |  |  | $ | 32,802 |

X
- Details
Name: | us-gaap_RealEstateAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for certain real estate investment financial statements, real estate investment trust operating support agreements, real estate owned, retail land sales, time share transactions, as well as other real estate related disclosures. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 02 -Paragraph 6 -Subparagraph a -Article 5 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 970 -SubTopic 360 -Section S99 -Paragraph 1 -Subparagraph (SX 210.12-28) -URI http://asc.fasb.org/extlink&oid=6590653&loc=d3e638233-123024 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 28 -Article 12 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 04 -Paragraph c -Subparagraph Schedule III -Article 5 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 03 -Paragraph 10 -Subparagraph 4 -Article 9 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 03 -Paragraph 11 -Article 9 + Details
Name: | us-gaap_RealEstateDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration