Boston Properties (NYSE:BXP), Inc. BXP recently announced the execution of three leases, aggregating 166,000 square feet at 880 Winter Street in Waltham, MA, which resulted in its 244,000-square-foot life sciences conversion project to be roughly 70% pre-leased. The project is slated for delivery in the second half of 2022.
Located next to the company’s Bay Colony properties in Waltham, this property is being redeveloped and converted into lab space by Boston Properties. This represents an advantageous location and positions BXP to lure life sciences organizations.
However, reflecting broader market concerns, shares of BXP have marginally declined during Friday’s trading session.
The 166,000-square-foot lease includes a 115,000-square-foot lease with TScan Therapeutics, Inc., a biopharmaceutical company, a 37,000-square-foot lease with RVAC Medicines, an mRNA biotechnology company and a 14,000-square-foot lease with EdiGene, a global clinical-stage biotechnology company.
According to Bryan Koop, Executive Vice President, Boston Region, BXP, these agreements “demonstrate our continued ability to convert existing buildings for life science uses to meet the growing demand for space by organizations in the industry.”
Amid the high need for effective diagnostics, therapies, drug innovations and research, life science properties continue to witness solid demand in recent years. Therefore, Boston Properties’ targeted efforts to boost its life science assets and tenant base from the industry seem a strategic fit.
BXP Life Sciences comprises an existing portfolio of more than three million square feet focused on the specific needs of the life sciences industry. The properties are mainly in the leading innovation markets of Boston, Cambridge, and Waltham/Lexington, MA; Montgomery County, MD, and San Francisco and Los Angeles, CA.
Moreover, Boston Properties has roughly six million square feet of life sciences-focused development opportunities, including one million square feet of current lab developments and redevelopments in process.
However, the overall choppy environment for the office real estate market remains a concern for Boston Properties which has a concentration of office assets in six markets — Boston, Los Angeles, New York, San Francisco, Seattle and Washington, D.C.
Boston Properties currently carries a Zacks Rank #3 (Hold). So far in the quarter, BXP’s shares have gained 1.7%, underperforming the industry’s increase of 6.5%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Key Picks
Some other key picks from the REIT sector include Extra Space Storage (NYSE:EXR) Inc. EXR, CubeSmart CUBE and Rexford Industrial Realty REXR.
Extra Space Storage holds a Zacks Rank of 2 (Buy) at present. The 2021 FFO per share for Extra Space Storage is expected to increase 29.9% year over year.
The Zacks Consensus Estimate for EXR’s 2021 FFO per share has been revised 2.1% upward in a week.
The Zacks Consensus Estimate for CubeSmart’s ongoing-year FFO per share has moved 1.4% north to $2.10 over the past week. Its long-term growth rate is projected at 9.8%.
The Zacks Consensus Estimate for CubeSmart’s 2021 FFO per share suggests an increase of 22.1% year over year. Currently, CUBE carries a Zacks Rank of 2.
Rexford Industrial holds a Zacks Rank of 2 at present. The long-term growth rate for Rexford Industrial Realty is projected at 12.8%.
The Zacks Consensus Estimate for REXR’s 2021 FFO per share has been revised 1.2% upward in a month to $1.63.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
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Boston Properties, Inc. (BXP): Free Stock Analysis Report
Extra Space Storage Inc (EXR): Free Stock Analysis Report
CubeSmart (CUBE): Free Stock Analysis Report
Rexford Industrial Realty, Inc. (REXR): Free Stock Analysis Report
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