Recently, the operating partnership known as Boston Properties Limited Partnership (abbreviated as “BPLP”) increased the size of its revolving credit facility by an aggregate amount that was equal to $315 million. This was accomplished by activating a portion of the accordion feature.
The transaction improves the company’s liquidity position and financial flexibility by providing it with a maximum borrowing capacity of $1.815 billion. At this time, the establishment does not have any outstanding balances.
“We are pleased to expand our borrowing capacity and increase the number of participants in our credit facility,” said Mike LaBelle, Executive Vice President, Chief Financial Officer, and Treasurer of the company. This expansion, particularly in light of the current state of the market, is a further demonstration of BXP’s robust financial position as well as the strength and support provided by our banking relationships.
The utilisation of the accordion feature resulted in the addition of three additional lenders to the facility. These lenders are the M&T Bank, the Sumitomo Mitsui Banking Corporation, and the Banco Bilbao Vizcaya Argentaria, S.A. BPLP now has the ability, subject to meeting certain requirements, to raise the total amount of money it has committed to the facility by up to an additional $185 million.
BPLP successfully closed on a brand new unsecured term credit facility in the amount of $1.2 billion in January 2023. The loan will be paid off in May 2024. The duration of the privilege can be increased by applying for and receiving a single 12-month extension, provided that the usual requirements are met.
Boston Properties is making active attempts to improve the quality of its portfolio by repositioning its holdings through a combination of property acquisitions, the development of properties in core markets, and the sale of properties located in non-core sectors.
Additionally, in response to a significant increase in demand from life-science tenants, the company is transforming a large number of existing suburban straight office buildings into office labs. This transformation is taking place most prominently at its Kendall Centre project, which is one of the most highly regarded desired places for life-science customers all over the world.
Notably, as of the end of the second quarter of 2023, BXP has 13 office, lab, retail, and residential projects in the works, with its part of the expected total investment amounting to around $2.6 billion, which appears to be encouraging.
The company is in a good position to capitalise on prospects for long-term growth because to the increased strength of its balance sheet and the significant financial flexibility it enjoys. As of the 30th of June in 2023, it had 3.1 billion dollars in liquid assets.
In comparison to the 11.5% drop that was experienced by the industry over the previous six months, the stock price of this Zacks Rank #3 (Hold) business has increased by 8.8%.
