Boston Properties, Inc. (NYSE:BXP) Q4 2022 Earnings Call Transcript

Nicholas Yulico: Thanks. A question for, I guess Owen or Doug, I was hoping to get a feel for — as you’re having conversations with your JV partners, pension funds or other potential institutional partners, what is their attitude right now towards office space, particularly in relation to investing incremental capital into buildings? What types buildings are still possible, what aren’t? And ultimately, how you think this is all going to affect office building values?

Owen Thomas: Yes, I think generally, institutional investors in real estate, not just the office are cautious at the moment given higher interest rates, slower leasing volumes that Doug just described and what the repricing is. And so, I think investment volumes generally from institutional investors have gone up €“ have down materially. So as it relates to office, I think it’s going — I think there is capital available from institutional investors for premier workplaces that are underwritten with the new cost of capital as well as the leasing dynamics that Doug described in the last question, which is we have a slower leasing environment and the assumptions when you’re underwriting a deal need to reflect that. But assuming you have all those pieces, I think there’s capital available for premier workplaces.

Douglas Linde: I also think the other thing to think about here too is the — we talked about the institutional investment world as its some homogenous group of investors. Well, it’s not. They all come from different geographic locations. They all have different funding sources. They all have different funding obligations, and so they don’t operate in a unified fashion. So my comments are not targeted to any one group, but I would just point that out.

Operator: Thank you. That concludes the Q&A session. At this time, I’d like to turn the call back over to Owen Thomas, Chairman and CEO for closing remarks.

Owen Thomas: Yes, thank you all for your time, attention and interest in BXP. Have a good day. Thank you.

Operator: Thank you. This concludes today’s conference call. Thank you for participating. You may now disconnect. Good day.