It has been about a month since the last earnings report for Boston Properties (BXP) . Shares have lost about 6% in that time frame, underperforming the S&P 500.But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is Boston Properties due for a breakout? Well, first let's take a quick look at its most recent earnings report in order to get a better handle on the recent catalysts for BXP, Inc. before we dive into how investors and analysts ha ...

On February 17, 2026, Connecticut-based H/2 Credit Manager disclosed a new position in Boston Properties (NYSE:BXP), acquiring 268,110 shares in a trade estimated at $18.09 million. What happened According to an SEC filing dated February 17, 2026, H/2 Credit Manager LP established a new holding in Boston Properties during the fourth quarter, acquiring 268,110 shares. The position’s quarter-end value totaled $18.09 million. What else to know Top holdings after the filing: NYSE:VRE: $81.44 million (17 ...

Boston, Massachusetts-based BXP, Inc. (BXP)  is the largest publicly traded developer, owner, and manager of premier workplaces in the United States. Valued at a market cap of $9.7 billion, the company is mainly concentrated in six dynamic gateway markets - Boston, Los Angeles, New York, San Francisco, Seattle, and Washington, DC. Its portfolio totals approximately 52.6 million square feet across 179 properties, including 8 under construction. Shares of BXP have lagged behind the broader market over the ...

Core Viewpoint - BXP, Inc. is recognized as a notable investment opportunity in the real estate sector, with varying analyst opinions on its price target and performance outlook [1][4][6]. Financial Performance - For Q4 2025, BXP reported revenue of $877.1 million, reflecting a 2.2% increase from $858.6 million in the same quarter of the previous year [5]. - The company achieved a net income of $248.5 million, or $1.56 per diluted share, compared to a net loss of $230.0 million, or $1.45 per diluted share, in the prior year [5]. Analyst Ratings and Price Targets - On February 5, 2026, Goldman Sachs reduced its price target for BXP from $75 to $72 while maintaining a Neutral rating, citing updates to its model after the Q4 results [3]. - Conversely, on February 2, 2026, BofA analyst Jeffrey Spector raised the price target from $83 to $84, maintaining a Buy rating, emphasizing the company's progress towards its 2026 goals despite slightly below-consensus Q4 results [4]. Company Overview - BXP, Inc. operates as a publicly traded Real Estate Investment Trust (REIT) focused on the development, ownership, and management of large-scale office properties in major U.S. gateway markets, including cities like Boston, Los Angeles, New York, San Francisco, Seattle, and Washington, DC [6].

Core Viewpoint - Commercial real estate stocks have experienced significant declines due to concerns about reduced demand for office space stemming from the increased use of artificial intelligence tools [1][4]. Group 1: Stock Performance - CBRE Group Inc. shares fell 8.8%, marking a two-day decline of 20%, the worst since 2020 [1]. - Other notable declines include Jones Lang LaSalle Inc. down 7.6%, Cushman & Wakefield Ltd. down 12%, and Newmark Group Inc. down 4.2% [1]. - An index tracking office real estate companies retreated by 4.2%, with major decliners including SL Green Realty Corp., Cousins Properties Inc., Kilroy Realty Corp., and BXP Inc. [2]. Group 2: Market Sentiment - Concerns regarding AI's impact on office space demand have been present for some time, but recent selloffs have intensified [2]. - Analysts describe the current market environment as a "ready fire aim" scenario, where investors react sharply to even minor earnings misses due to fears of AI disruption [3]. - The selloff is part of a broader trend referred to as the "AI scare trade," affecting various sectors including software, private credit, and logistics [3][4]. Group 3: Analyst Insights - Analysts have noted that the market is pricing in potential mass job losses in office-using sectors due to AI advancements [4]. - Some analysts caution that the recent steep selling may be an overreaction and could be misjudging the actual risks involved [5].

Core Viewpoint - BXP, Inc. is positioned strongly to meet demand due to its premier assets, leading to a buy rating given in October of the previous year [1] Group 1: Investment Thesis - The investment approach focuses on identifying undervalued companies with long-term growth potential, blending value investing principles with a long-term growth focus [1] - The strategy emphasizes purchasing quality companies at a discount to their intrinsic value and holding them to allow for compounding of earnings and shareholder returns [1]

Core Insights - BXP has demonstrated strong leasing activity, completing over 1.8 million square feet in Q4 and more than 5.5 million square feet for the full year of 2025, leading to an occupancy rate of 86.7% at year-end [1][5][18] - The company is focused on a multi-part business plan that includes leasing-driven occupancy gains, portfolio optimization through asset sales, and selective development [2][4] - BXP's 2026 FFO guidance is set at $6.88 to $7.04 per share, reflecting anticipated occupancy and development gains, alongside expected asset sales [3][20] Leasing Activity - In Q4, BXP executed leases on 550,000 square feet tied to expirations in 2026 and 2027, and entered 2026 with 1.243 million square feet of signed leases not yet commenced [1] - The company aims for a leasing target of approximately 4 million square feet in 2026, with a current negotiation pipeline of 1.2 million square feet [5][6] - Management expects occupancy to rise to about 89% by year-end 2026, with a projected average same-property occupancy of 87.5% to 88.5% during the year [7] Financial Performance - BXP reported 2025 consolidated revenues of $3.5 billion and FFO of $1.2 billion, or $6.85 per share, with Q4 FFO at $1.76 per share, slightly below guidance [18][19] - The company anticipates a $0.11 increase in FFO for 2026 compared to 2025, driven by occupancy gains and lower interest expenses [20] - Management expects quarterly FFO to improve throughout 2026, particularly in the latter half of the year [21] Portfolio Optimization - BXP is executing a plan to sell 27 assets for approximately $1.9 billion by 2028, with over $1 billion already closed [4][11] - The company is pursuing residential entitlements for over 3,500 units across various states, which can be accretive as these assets generate no income [12] - BXP has removed certain properties from its in-service portfolio as part of redevelopment planning, including a 275,000-square-foot office building [13] Development Plans - BXP is prioritizing development over acquisitions, with a new project in Washington, D.C. expected to yield an unleveraged cash return of over 8% [15] - The company has three multifamily projects under construction and is in various stages for 11 additional projects totaling over 5,000 units [16] - A key focus remains on securing a financial partner for the 343 Madison Avenue project, with negotiations ongoing for equity stakes [17] Market Commentary - Management highlighted a return-to-office trend, with a 10% increase in office visits nationwide in December 2025 compared to December 2024, and noted strong demand from AI companies [8][9] - In San Francisco, 36% of tenant demand is attributed to AI or AI-related technology companies, indicating a robust market for office space in this sector [8]

Financial Data and Key Metrics Changes - For 2025, total consolidated revenues were reported at $3.5 billion, with full year FFO of $1.2 billion, equating to $6.85 per share. The fourth quarter FFO was $1.76 per share, which was $0.05 below the midpoint of guidance due to higher G&A expenses and non-cash reserves for accrued rental income [41][42][43] - The company expects 2026 FFO guidance to range from $6.88 to $7.04 per share, representing an increase of $0.11 per share from 2025 [44][55] Business Line Data and Key Metrics Changes - The company completed over 1.8 million sq ft of leasing in Q4 and over 5.5 million sq ft for the full year 2025, exceeding annual goals [7] - The occupancy rate increased by approximately 70 basis points in Q4, with 35% of the gain attributed to portfolio leasing improvements and the remainder from asset sales [23] Market Data and Key Metrics Changes - Direct vacancy for premier workplaces in five key markets was reported at 11.6%, which is 560 basis points lower than the broader market [9] - Office sales in the private market improved, with significant transactions totaling $17.3 billion in Q4, marking a 43% increase from Q3 2025 [14] Company Strategy and Development Direction - The company aims to optimize its portfolio through asset sales, targeting $1.9 billion in net proceeds by 2028, with $1 billion already achieved [10][11] - BXP is focusing on premier workplace assets and CBD locations, with new developments launched at 343 Madison Avenue in New York City and 725 12th Street in Washington, DC [21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the leasing environment, citing expected double-digit earnings growth for companies in the S&P 500 and Russell 2000 indices [7] - The company anticipates achieving a 4% occupancy gain over the next two years, supported by strong leasing activity and market trends [10][21] Other Important Information - The company has a development pipeline of eight projects totaling 3.5 million sq ft and $3.7 billion in investment, expected to deliver strong external growth [18] - The company is negotiating a letter of intent for a significant portion of the 343 Madison Avenue development, with expected stabilized cash returns of 7.5%-8% upon delivery in 2029 [20] Q&A Session Summary Question: Inquiry about portfolio disposition strategy - Management confirmed that they are sticking to the original goal of $1.9 billion in sales and are open to additional sales if attractive prices are offered, while being mindful of the dilutive impacts on earnings [59][60][61] Question: Conversion rates for leasing negotiations - The conversion rate for the 1.1 million sq ft in negotiations is approximately 95%, with expectations to lease 4 million sq ft of space in 2026 [70]

Financial Data and Key Metrics Changes - For the full year 2025, the company reported total consolidated revenues of $3.5 billion and full year FFO of $1.2 billion, or $6.85 per share. The fourth quarter FFO was $1.76 per share, which was $0.05 per share short of the midpoint of guidance due to higher G&A expenses and non-cash reserves for accrued rental income [41][42][43] - The company ended 2025 with an in-service occupancy of 86.7% and expects to increase occupancy to approximately 89% by the end of 2026 [45][56] Business Line Data and Key Metrics Changes - The company completed over 1.8 million sq ft of leasing in Q4 and over 5.5 million sq ft for the full year 2025, exceeding annual goals [7] - The leasing activity is expected to continue into 2026, with a forecast of 4 million sq ft of leasing for the year [25] - The company has seen a significant increase in demand for premier workplaces, with direct vacancy for these spaces at 11.6%, significantly lower than the broader market [9][10] Market Data and Key Metrics Changes - Office utilization data indicated a 10% increase in office visits nationwide from December 2024 to December 2025, marking the busiest in-office December since the pandemic [8] - The company is experiencing accelerating demand from AI companies, particularly in major markets like the Bay Area and New York City [8][9] Company Strategy and Development Direction - The company aims to optimize its portfolio through asset sales, targeting $1.9 billion in net proceeds by 2028, with $1 billion already achieved through the sale of 12 assets [10][11] - The company is focusing on urban premier workplace concentration and has launched new developments in key markets [21] - The strategy includes reallocating capital to premier workplace assets and CBD locations while exploring additional development and acquisition opportunities [21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the positive leasing environment, supported by expected double-digit earnings growth for companies in the S&P 500 and Russell 2000 indices [7] - The company anticipates that the current macroeconomic conditions will lead to higher occupancy and rent growth in many submarkets [21] - Management noted that while there are concerns about AI's impact on jobs, many clients are expanding their footprints and upgrading their spaces [8] Other Important Information - The company has a development pipeline of 3.5 million sq ft and $3.7 billion of investment across various projects [18] - The company expects to deliver significant new developments, including a 573,000 sq ft life science project in Cambridge, which is 100% leased to AstraZeneca [49] Q&A Session Summary Question: Inquiry about potential additional asset dispositions - Management confirmed that they are sticking to the original goal of $1.9 billion in sales and are open to selling more assets if attractive prices are offered, while being mindful of the dilutive impacts on earnings [60][61][62] Question: Conversion rates for leasing negotiations - Management indicated a high conversion rate of approximately 95% for deals in negotiation and expects to lease 4 million sq ft of space in 2026 [70][71]

Financial Data and Key Metrics Changes - For 2025, total consolidated revenues were reported at $3.5 billion, with full year FFO of $1.2 billion, equating to $6.85 per share. The fourth quarter FFO was $1.76 per share, which was $0.05 below the midpoint of guidance due to higher G&A expenses and non-cash reserves for accrued rental income [41][42] - The company ended 2025 with an in-service occupancy of 86.7% and expects to increase this to approximately 89% by the end of 2026, indicating a meaningful increase in occupancy [45] Business Line Data and Key Metrics Changes - The company completed over 1.8 million sq ft of leasing in Q4 and over 5.5 million sq ft for the full year 2025, exceeding annual goals [5] - Leasing activity is expected to continue positively into 2026, with a forecast of 4 million sq ft of leasing for the year [25] Market Data and Key Metrics Changes - Direct vacancy for premier workplaces in the five markets where the company competes is reported at 11.6%, significantly lower than the broader market [8] - The company noted a 10% increase in office visits nationwide from December 2024 to December 2025, indicating a recovery in office utilization [6] Company Strategy and Development Direction - The company aims to optimize its portfolio through asset sales, targeting $1.9 billion in net proceeds by 2028, with $1 billion already achieved [9][10] - The strategy includes reallocating capital to premier workplace assets and CBD locations, with new developments launched in key markets [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the leasing environment, citing strong demand from clients, particularly in the AI sector, which is driving growth in leasing activity [6][77] - The company anticipates that the positive trends in leasing will continue, supported by expected earnings growth for companies in the S&P 500 and Russell 2000 indices [5] Other Important Information - The company reported gains on asset sales of $208 million on $890 million of sales in Q4, which will enhance liquidity and be used to reduce debt [43] - The company has a development pipeline of 3.5 million sq ft and $3.7 billion of investment, with several projects expected to deliver strong external growth [18] Q&A Session Summary Question: Inquiry about potential additional asset dispositions - Management confirmed that they are sticking to the original forecast of $1.9 billion in sales and are open to additional sales if attractive prices are offered, emphasizing that many sales are land assets which are accretive [61][62][63] Question: Conversion rates for leasing negotiations - The company reported a conversion rate of approximately 95% for deals in negotiation, with expectations to lease 4 million sq ft of space in 2026 [72] Question: Impact of AI on leasing needs - Management indicated that AI has not negatively impacted leasing needs within their portfolio, with significant leasing activity observed, particularly from AI companies [77]