According to Owen Thomas, CEO of Boston Properties Inc., it is a very exciting time to be part of Boston Properties. On the firm’s Q3 earnings call, Thomas explained that the markets where the REIT operated continue to display strong economic performance.
“Unemployment is at record lows and our tenants continue to seek high quality class A properties to attract and retain their most precious asset which is talent and the urbanization trend continues as companies and their employees seek the opportunity, community and amenities of urban locations,” he said.
Boston Properties is in the middle of and benefiting from these macro trends and the investments the company has made over the past few years and new development are positioning it for growth with a high level of preleasing and new developments and a long average lease term in the existing portfolio, he said. “Our growth is durable and much less sensitive to where we might be in the business cycle.”
He also explained that the company’s tenant base is diversified across market sectors and the company’s assets that are located across geographies help to insulate the company in the event of a market shift within a sector or geography. “Our strategy of developing and owning class A office properties in top tier gateway cities continues to serve us well and provides a long-term competitive advantage in creating value for shareholders.”
As for the details of the quarter, he said it was another strong one. “We made additional progress towards achieving our annual and long-term goal. Specifically, this quarter we generated FFO per share $0.02 above the midpoint of our prior forecast and $0.01 above Street consensus. On a year over year basis FFO per share grew 4% in the third quarter. We also increased our full year guidance for 2018 by $0.02.”
He also pointed out that the REIT increased its regular quarterly cash dividend by 19% to $0.95 per share—The largest dividend increase in the history of Boston Properties. “We provided a strong outlook for 2019, forecasting FFO per share growth of 7% at the midpoint of our range.”