Boston Properties (BXP) Secures Renewal and Expansion Lease
Boston Properties' (BXP) securing of expansion and renewal lease at Atlantic Wharf highlights healthy demand for the property.
Boston Properties, Inc. BXP recently signed a 10-year lease renewal and expansion agreement with Wellington Management at Atlantic Wharf. The long-term agreement for 524,000 square foot will commence in 2026. It also includes a 66,000-square-foot expansion within the building, which will commence in 2022. The lease reflects healthy demand for the property located at 280 Congress Street, Boston, MA.
Located on Boston’s Waterfront, this 790,000-square-foot office tower has creative office space and residential units. It provides underground parking, a waterfront plaza and onsite retail including Nebo, Sorelle, Smith & Wollensky, and Trade restaurants.
The property is also easily accessible from I-90 and I-93 as well as Boston’s largest commuter rail, Amtrak, MBTA bus and subway transit stations. This has likely made the tenant to go for lease renewal and expansion at this property. Headquartered at Atlantic Wharf since the building’s opening in 2011, Wellington will occupy 22 floors of the 31-story building.
The latest lease will boost occupancy level at Boston Properties’ property and fuel revenue growth from rental income.
Despite a lackluster office real estate market scenario, the company has seen an uptick in leasing activity in the recent quarters, and signed long-term leases with media, technology and consulting companies. In June, it signed a seven-year lease with a leading entertainment company for 351,000 square feet of space. It also inked a 140,000-square-foot expansion lease at Santa Monica Business Park in Santa Monica, CA, with a technology company.
During the second quarter, the company signed 1.2 million square feet of leases with a weighted-average lease term of 7.5 years.
Moreover, with further reopening of the economy and vaccine distribution at a faster pace, an uptick in office jobs is anticipated in the coming months. Amid this, Boston Properties’ portfolio of modern, class A office buildings is well poised to benefit from the flight-to-quality preference of office tenants.
Since the beginning of the year, shares of this Zacks Rank #3 (Hold) company have gained 17.7%, outperforming the industry's rally of 15.7%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
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