BXP Beats Forecast, Swings to Q3 Profit as Occupancy Rises Again

Boston-based office landlord BXP reported third-quarter 2026 results on Tuesday, Oct. 27, that beat its own forecast and swung to a profit of $114.5 million, or $0.71 a share, from a loss of $121.7 million a year earlier. BXP, formerly Boston Properties, also raised its full-year 2026 guidance and said occupancy rose for a fourth straight quarter.

The figures come from the company’s earnings release, which is unaudited. BXP is holding a public conference call on Wednesday, Oct. 28, at 10 a.m. Eastern to discuss the quarter.

BXP Third-Quarter 2026 Results at a Glance

• Revenue: $911.4 million for the quarter ended Sept. 30, up 4.6% from $871.5 million a year earlier.
• Net income: $114.5 million, or $0.71 per diluted share, compared with a net loss of $121.7 million, or $0.77 per share, in the third quarter of 2025.
• Funds from operations (FFO): $302.2 million, or $1.89 per diluted share, up from $1.74. FFO is the standard REIT earnings measure that excludes real estate depreciation and gains or losses on property sales.
• Versus guidance: EPS beat the midpoint of BXP’s forecast by $0.20 a share, which the company attributed mainly to gains on property sales and stronger-than-expected portfolio performance. FFO beat by $0.08.
• Leasing: 74 leases covering about 1.2 million square feet, with an average term of 10.3 years.

The year-earlier loss reflected large write-downs. BXP’s financial tables show about $214 million in impairment charges in the third quarter of 2025, including $145.1 million recorded through joint ventures. No impairments were recorded in the latest quarter.

Occupancy Climbs, and Boston Stays the Strongest Market

BXP said total portfolio occupancy reached 89.4% at the end of September, up 1 percentage point from the second quarter. Including signed leases that have not yet started, the portfolio was 91.9% leased. The company said the gap between leased and occupied space represents about 1.1 million square feet of future move-ins, roughly half of which it expects to begin before the end of 2026.

Boston remains its best-performing market. BXP’s downtown and urban-core (“CBD”) Boston buildings were 97.4% occupied on Sept. 30, compared with 97.6% at the end of 2025, and 97.7% leased, down from 98.6%. Across all of its Boston-area properties, including suburban ones, occupancy rose to 93.4% from 91.9%. By comparison, the company’s San Francisco portfolio was 81.4% occupied.

That stands out against the broader downtown market. As we reported earlier this month, downtown Boston office vacancy was about 18.5% in the third quarter, while demand has concentrated in the newest, best-located towers, the trend behind record rents at the top of the market.

Guidance, Sales and New Debt

BXP now expects full-year 2026 EPS of $2.35 to $2.37 and FFO of $7.06 to $7.08 per share. It raised the EPS midpoint by $0.17 and the FFO midpoint by $0.05.

During the quarter, the company sold two Washington, D.C., office buildings, Sumner Square and 1330 Connecticut Avenue, for a combined $155.4 million, booking gains of about $10.5 million. It also took out a $1.2 billion construction loan for its 343 Madison Avenue tower in New York and sold a 10.6% stake in that project to AVRS Partners. Its operating partnership issued $700 million of 6.05% senior notes due 2036.

Our Take

This section is analysis by The Boston Report and is separate from the reporting above.

BXP’s numbers support the idea that Boston’s office market has split in two. The company’s urban Boston buildings, which include the Prudential Center in Back Bay, are close to full while much of downtown carries high vacancy. Tenants such as law firms and consolidating headquarters, like Wayfair’s move to 500 Boylston St., are paying up for newer space and leaving older buildings behind.

The slight dip in BXP’s leased rate for Boston’s urban core is worth watching but is small, and the suburban gains offset it. The bigger caution is cost of capital: new bonds at a 6.05% coupon and a construction loan priced at SOFR plus 2.5% show that borrowing is still expensive, which could keep pressure on landlords that own older, half-empty downtown buildings. For Boston, the takeaway is that the best buildings are doing fine, and the challenge for the city’s tax base is everything else.

Sources

• BXP: BXP Announces Third Quarter 2026 Results
• Business Wire: BXP third-quarter 2026 results release
• BXP Investor Relations: Events and webcasts