Investments in Real Estate or Interests in Real Estate
Our investment objectives are to provide quarterly cash dividends to our securityholders
and to achieve long-term capital appreciation through increases in the value
of Boston Properties, Inc. We have not established a specific policy regarding
the relative priority of these investment objectives.
We expect to continue to pursue our investment objectives primarily through
the ownership of our current properties, development projects and other acquired
properties. We currently intend to continue to invest primarily in developments
of properties and acquisitions of existing improved properties or properties
in need of redevelopment, and acquisitions of land that we believe have development
potential, primarily in our markets—Boston, Washington, D.C., midtown Manhattan,
San Francisco and Princeton, N.J. Future investment or development activities
will not be limited to a specified percentage of our assets. We intend to engage
in such future investment or development activities in a manner that is consistent
with the maintenance of our status as a REIT for federal income tax purposes.
In addition, we may purchase or lease income-producing commercial and other
types of properties for long-term investment, expand and improve the real estate
presently owned or other properties purchased, or sell such real estate properties,
in whole or in part, when circumstances warrant. We do not have a policy that
restricts the amount or percentage of assets that will be invested in any specific
property, however, our investments may be restricted by our debt covenants.
We may also continue to participate with third parties in property ownership,
through joint ventures or other types of co-ownership. These investments may
permit us to own interests in larger assets without unduly restricting diversification
and, therefore, add flexibility in structuring our portfolio.
Equity investments may be subject to existing mortgage financing and other
indebtedness or such financing or indebtedness as may be incurred in connection
with acquiring or refinancing these investments. Debt service on such financing
or indebtedness will have a priority over any distributions with respect to
our common stock. Investments are also subject to our policy not to be treated
as an investment company under the Investment Company Act of 1940, as amended
(the “1940 Act”).
Investments in Real Estate Mortgages
While our current portfolio consists of, and our business objectives emphasize,
equity investments in commercial real estate, we may, at the discretion of the
Board of Directors, invest in mortgages and other types of real estate interests
consistent with our qualification as a REIT. Investments in real estate mortgages
run the risk that one or more borrowers may default under such mortgages and
that the collateral securing such mortgages may not be sufficient to enable
us to recoup its full investment. We do not presently intend to invest in mortgages
or deeds of trust, but may invest in participating or convertible mortgages
if we conclude that we may benefit from the cash flow or any appreciation in
value of the property.
Securities of or Interests in Persons Primarily Engaged in Real Estate Activities
Subject to the percentage of ownership limitations and gross income tests necessary
for our REIT qualification, we also may invest in securities of other REITs,
other entities engaged in real estate activities or securities of other issuers,
including for the purpose of exercising control over such entities.