On April 1, 2013, the Company was designated as the Owner’s Representative by Harvard Planning and Project Management to provide development management services for Harvard’s new Health and Life Sciences Facility.

On April 1, 2013, the Company used available cash to repay the mortgage loan collateralized by its 140 Kendrick Street property located in Needham, Massachusetts totaling approximately $47.6 million. The mortgage loan bore interest at a fixed rate of 7.51% per annum and was scheduled to mature on July 1, 2013. There was no prepayment penalty.

On April 1, 2013, the Company commenced construction on the initial phase of its Transbay Tower development project totaling approximately 1.4 million net rentable square feet located in San Francisco, California.

On April 4, 2013, a joint venture in which the Company has a 50% interest obtained construction financing collateralized by its Annapolis Junction Building Seven development project located in Annapolis, Maryland totaling $22.0 million. The construction financing bears interest at a variable rate equal to LIBOR plus 1.65% per annum and matures on April 4, 2016, with two, one-year extension options, subject to certain conditions.

On April 10, 2013, the Company acquired the Mountain View Research Park and Mountain View Technology Park properties from its Value-Added Fund for an aggregate purchase price of approximately $233.5 million. In conjunction with the acquisition, the Value-Added Fund repaid the mortgage loans collateralized by the Mountain View Research Park and Mountain View Technology Park properties totaling approximately $90.0 million and $20.0 million, respectively, as well as the outstanding loans payable to the Company’s Operating Partnership totaling approximately $8.6 million and $3.7 million, respectively. The Mountain View Research Park and Mountain View Technology Park mortgage loans bore interest at variable rates equal to LIBOR plus 2.00% per annum and LIBOR plus 2.50% per annum, respectively, and were scheduled to mature on May 31, 2014 and November 22, 2014, respectively. Prior to the acquisition, the Company’s ownership interest in the properties was approximately 39.5%. As a result of the acquisition, the Company owns 100% of the properties and is accounting for them on a consolidated basis.

On April 11, 2013, the Company’s Operating Partnership completed a public offering of $500.0 million in aggregate principal amount of its 3.125% senior unsecured notes due 2023. The notes were priced at 99.379% of the principal amount to yield an effective rate (including financing fees) of 3.279% to maturity. The notes will mature on September 1, 2023, unless earlier redeemed. The aggregate net proceeds from the offering were approximately $492.5 million after deducting the underwriting discount and transaction expenses.

On April 15, 2013, the Company announced that holders of its Operating Partnership’s 3.75% Exchangeable Senior Notes due 2036 (the “Notes”) had the right to surrender their Notes for purchase by the Operating Partnership (the “Put Right”) on May 18, 2013. On April 15, 2013, the Company also announced that the Operating Partnership issued a notice of redemption to the holders of the Notes to redeem, on May 18, 2013 (the “Redemption Date”), all of the Notes outstanding on the Redemption Date. In connection with the notice of redemption, holders of the Notes had the right to exchange their Notes on or prior to May 16, 2013. Notes with respect to which the Put Right was not exercised and that were not surrendered for exchange on or prior to May 16, 2013, were redeemed by the Operating Partnership at a redemption price equal to 100% of the principal amount of the Notes plus accrued and unpaid interest thereon to, but excluding, the Redemption Date. Based on final information provided to the Operating Partnership by the trustee for the Notes, no Notes were validly tendered and accepted for purchase in the Put Right. Pursuant to the notice of redemption, an aggregate principal amount of $990,000 of the Notes was redeemed on May 18, 2013. The remaining aggregate principal amount of $449,010,000 of the Notes was surrendered for exchange and, in addition to the repayment of the principal in cash, the Company issued an aggregate of 419,116 shares of its common stock in exchange for the Notes.

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. The project is approximately 79% pre-leased.

On May 30, 2013, a joint venture in which the Company has a 60% interest completed the sale of its 125 West 55th Street property located in New York City for a sale price of $470.0 million, including the assumption by the buyer of the mortgage loan collateralized by the property totaling approximately $198.6 million. 125 West 55th Street is a Class A office property totaling approximately 588,000 net rentable square feet.

On May 31, 2013, a joint venture in which the Company has a 30% interest refinanced its construction loan collateralized by 500 North Capitol Street, NW located in Washington, DC. The construction loan totaling approximately $90.6 million bore interest at a variable rate equal to LIBOR plus 1.65% per annum and was scheduled to mature on October 14, 2014. The new mortgage loan totaling $105.0 million requires interest-only payments at a fixed interest rate of 4.15% per annum and matures on June 6, 2023.

On May 31, 2013, the Company’s two joint venture partners in 767 Venture, LLC (the entity that owns 767 Fifth Avenue (The GM Building) in New York City) transferred all of their interests in the joint venture to third parties. 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 the Company now 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. Upon consolidation, the Company recognized a non-cash gain on its investment of approximately $363.4 million. The financial impact and reporting implications are presented on the accompanying table entitled “Projected Operating Results.” There can be no assurance that the actual operating results will not differ materially from these projections.

On June 5, 2013, a joint venture in which the Company has a 60% interest refinanced its mortgage loans collateralized by 540 Madison Avenue located in New York City. The mortgage loans aggregating approximately $118.0 million bore interest at a weighted-average fixed rate of 5.20% per annum and were scheduled to mature on July 11, 2013. The new mortgage loan totaling $120.0 million requires interest-only payments at a variable rate equal to LIBOR plus 1.50% per annum and matures on June 5, 2018.

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. The property is 100% leased.

On June 27, 2013, the Company’s Operating Partnership completed a public offering of $700.0 million in aggregate principal amount of its 3.800% senior unsecured notes due 2024. The notes were priced at 99.694% of the principal amount to yield an effective rate (including financing fees) of 3.916% to maturity. The notes will mature on February 1, 2024, unless earlier redeemed. The aggregate net proceeds from the offering were approximately $691.9 million after deducting the underwriting discount and transaction expenses.

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. During the first quarter of 2013, the Company recognized an impairment loss totaling approximately $3.2 million, which was excluded from FFO in accordance with NAREIT’s definition, as the carrying value of the property exceeded its net sale price. As a result, there was no loss on sale of real estate recognized during the three months ended June 30, 2013.

On July 1, 2013, the Company completed and fully placed in-service its Cambridge Center Connector project with approximately 43,000 net rentable square feet located in Cambridge, Massachusetts. The project is 100% leased.

On July 15, 2013, the Company executed a binding contract for the sale of its 1301 New York Avenue property located in Washington, DC for a net contract sale price of approximately $121.7 million. After adjusting for outstanding lease and other transaction costs to be assumed by the buyer, the gross sale price is approximately $135.0 million. 1301 New York Avenue is a Class A office property totaling approximately 201,000 net rentable square feet. The sale is subject to the satisfaction of customary closing conditions and there can be no assurance that the sale will be consummated on the terms currently contemplated, or at all.

On July 19, 2013, a joint venture in which the Company has a 50% interest completed the sale of its Eighth Avenue and 46th Street project located in New York City for an imputed sale price of $45.0 million. Eighth Avenue and 46th Street is comprised of an assemblage of land parcels and air-rights. Net cash proceeds to the Company totaled approximately $21.8 million, after the payment of transaction costs.

On July 26, 2013, the Company’s Operating Partnership amended and restated the revolving credit agreement governing the Company’s Unsecured Line of Credit, which, among other things, (1) increased the total commitment from $750.0 million to $1.0 billion, (2) extended the maturity date from June 24, 2014 to July 26, 2018 and (3) reduced the per annum variable interest rates and other fees. Based on the Operating Partnership’s current credit rating, borrowings will bear interest at a per annum rate equal to LIBOR plus 1.00%. Under the amended and restated Unsecured Line of Credit, the Operating Partnership may increase the total commitment to $1.5 billion, subject to syndication of the increase.

Projected EPS (diluted)

Add:

Projected Company Share of Real Estate Depreciation and Amortization

Less:

Projected Company Share of Gains on Sales of Real Estate

Projected FFO per Share (diluted)

Real estate

Construction in progress

Land held for future development

Less: accumulated depreciation

Total real estate

Cash and cash equivalents

Cash held in escrows

Investments in securities

Tenant and other receivables, net of allowance for doubtful accounts of $1,377 and $1,960, respectively

Related party notes receivable

Interest receivable from related party notes receivable

Accrued rental income, net of allowance of $3,641 and $1,571, respectively

Deferred charges, net

Prepaid expenses and other assets

Investments in unconsolidated joint ventures

Total assets

Liabilities:

Mortgage notes payable

Unsecured senior notes, net of discount

Unsecured exchangeable senior notes, net of discount

Unsecured line of credit

Mezzanine notes payable

Related party notes payable

Accounts payable and accrued expenses

Dividends and distributions payable

Accrued interest payable

Other liabilities

Total liabilities

Commitments and contingencies

Noncontrolling interest:

Redeemable preferred units of the Operating Partnership

Redeemable interest in property partnership

Equity:

Stockholders’ equity attributable to Boston Properties, Inc.

Excess stock, $0.01 par value, 150,000,000 shares authorized, none issued or outstanding

Preferred stock, $0.01 par value, 50,000,000 shares authorized; 5.25% Series B cumulative redeemable preferred stock, $0.01 par value, liquidation preference $2,500 per share, 92,000 shares authorized, 80,000 and no shares issued and outstanding at June 30, 2013 and December 31, 2012, respectively

Common stock, $0.01 par value, 250,000,000 shares authorized, 152,463,640 and 151,680,109 shares issued and 152,384,740 and 151,601,209 shares outstanding at June 30, 2013 and December 31, 2012, respectively

Additional paid-in capital

Earnings (dividends) in excess of dividends (earnings)

Treasury common stock, at cost

Accumulated other comprehensive loss

Total stockholders’ equity attributable to Boston Properties, Inc.

Noncontrolling interests:

Common units of the Operating Partnership

Property partnerships

Total equity

Total liabilities and equity

Revenue

Rental

Base rent

Recoveries from tenants

Parking and other

Total rental revenue

Hotel revenue

Development and management services

Total revenue

Expenses

Operating

Rental

Hotel

General and administrative

Transaction costs

Impairment loss

Depreciation and amortization

Total expenses

Operating income

Other income (expense)

Income from unconsolidated joint ventures

Gains on consolidation of joint ventures

Interest and other income

Gains (losses) from investments in securities

Gains from early extinguishments of debt

Interest expense

Income from continuing operations

Discontinued operations

Income from discontinued operations

Gain on sale of real estate from discontinued operations

Gain on forgiveness of debt from discontinued operations

Impairment loss from discontinued operations

Net income

Net income attributable to noncontrolling interests

Noncontrolling interests in property partnerships

Noncontrolling interest—redeemable preferred units of the Operating Partnership

Noncontrolling interest—common units of the Operating Partnership

Noncontrolling interest in discontinued operations—common units of the

Operating Partnership

Net income attributable to Boston Properties, Inc.

Preferred dividends

Net income attributable to Boston Properties, Inc. common shareholders

Basic earnings per common share attributable to Boston Properties, Inc. common shareholders:

Income from continuing operations

Discontinued operations

Net income

Weighted average number of common shares outstanding

Diluted earnings per common share attributable to Boston Properties, Inc. common shareholders:

Income from continuing operations

Discontinued operations

Net income

Weighted average number of common and common equivalent shares outstanding

Net income attributable to Boston Properties, Inc. common shareholders

Add:

Preferred dividends

Noncontrolling interest in discontinued operations—common units of the

Operating Partnership

Noncontrolling interest—common units of the Operating Partnership

Noncontrolling interest—redeemable preferred units of the Operating Partnership

Noncontrolling interests in property partnerships

Impairment loss from discontinued operations

Less:

Income from discontinued operations

Gain on sale of real estate from discontinued operations

Gain on forgiveness of debt from discontinued operations

Income from continuing operations

Add:

Real estate depreciation and amortization (2)

Income from discontinued operations

Less:

Gains on sales of real estate included within income from unconsolidated joint ventures (3)

Gains on consolidation of joint ventures (3)

Noncontrolling interests in property partnerships’ share of funds from operations

Noncontrolling interest—redeemable preferred units of the Operating Partnership

Preferred dividends

Funds from operations (FFO) attributable to the Operating Partnership

Less:

Noncontrolling interest—common units of the Operating Partnerships’ share of funds from operations

Funds from operations attributable to Boston Properties, Inc.

Boston Properties, Inc.’s percentage share of funds from operations—basic

Weighted average shares outstanding—basic

FFO per share basic

Weighted average shares outstanding—diluted

FFO per share diluted

Base rent and recoveries from tenants

Straight-line rent (3)

Fair value lease revenue (3)

Parking and other

Total rental revenue

Operating expenses (excluding management fees)

Management fee expense

Revenue less operating expenses

Interest expense

Interest expense on partner loans

Fair value interest expense (3)

Depreciation and amortization (3)

Net income (loss)

Noncontrolling interest in property partnerships (income) loss

Company share of net income/(loss)

Elimination of interest expense on intercompany partner loan

Company share of depreciation and amortization

BXP share of FFO

Management fee income

Net contribution

Noncontrolling Partner Interest in Property Partnership Reconciliation

Net income (loss)

Less: Noncontrolling interest expense on partner loans

Property net income excluding interest expense on partner loans

Partners' 40% share of net (income) loss excluding interest expense on partner loans

Plus: Allocation of noncontrolling interest in interest expense on partner loans

Plus: Allocation of management fee expense to noncontrolling partner

Noncontrolling interest in property partnerships (income) loss

Boston

New York

Princeton

San Francisco

Washington, DC

Total Portfolio

Class A Office Portfolio

Office/Technical Portfolio

Total Portfolio