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Real Estate
 9 Months Ended
Sep. 30, 2020
Real Estate [Abstract]  
Real Estate
3. Real Estate
Boston Properties, Inc.
Real estate consisted of the following at September 30, 2020 and December 31, 2019 (in thousands):
September 30, 2020December 31, 2019
Land$5,069,206 $5,111,606 
Right of use assets - finance leases237,382 237,394 
Right of use assets - operating leases146,973 148,640 
Land held for future development (1)446,392 254,828 
Buildings and improvements13,748,127 13,646,054 
Tenant improvements2,687,911 2,656,439 
Furniture, fixtures and equipment49,209 44,313 
Construction in progress769,846 789,736 
Total23,155,046 22,889,010 
Less: Accumulated depreciation(5,413,709)(5,266,798)
$17,741,337 $17,622,212 
_______________
(1)Includes pre-development costs.
Boston Properties Limited Partnership
Real estate consisted of the following at September 30, 2020 and December 31, 2019 (in thousands):
September 30, 2020December 31, 2019
Land$4,971,990 $5,011,153 
Right of use assets - finance leases237,382 237,394 
Right of use assets - operating leases146,973 148,640 
Land held for future development (1)446,392 254,828 
Buildings and improvements13,468,534 13,351,286 
Tenant improvements2,687,911 2,656,439 
Furniture, fixtures and equipment49,209 44,313 
Construction in progress769,846 789,736 
Total22,778,237 22,493,789 
Less: Accumulated depreciation(5,309,930)(5,162,908)
$17,468,307 $17,330,881 
_______________
(1)Includes pre-development costs.
Developments
On March 26, 2020, the Company completed and fully placed in-service 17Fifty Presidents Street located in Reston, Virginia. 17Fifty Presidents Street is a build-to-suit project with approximately 276,000 net rentable square feet of Class A office space that is 100% leased.
On June 1, 2020, the Company completed and fully placed in-service 20 CityPoint, a Class A office project with approximately 211,000 net rentable square feet located in Waltham, Massachusetts that is 62% leased.
On June 26, 2020, the Company completed the acquisition of real property at 777 Harrison Street (known as Fourth + Harrison and formerly known as 425 Fourth Street) located in San Francisco, California for a gross purchase price, including entitlements, totaling approximately $140.1 million. On July 31, 2020, the Company acquired an undivided ownership interest in real property at 759 Harrison Street located in San Francisco, California, which is expected to be included in the Fourth + Harrison development project, for a purchase price totaling approximately $2.3 million. Fourth + Harrison is expected to support the development of approximately 804,000 square feet of primarily commercial office space.
On August 15, 2020, the Company completed and fully placed in-service The Skylyne, an approximately 331,000 square foot project comprised of 402 residential units and retail space located in Oakland, California.
Dispositions
On January 28, 2020, the Company entered into a joint venture with a third party to own, operate and develop properties at its Gateway Commons complex located in South San Francisco, California. The Company contributed its 601, 611 and 651 Gateway properties and development rights with an agreed upon value aggregating approximately $350.0 million for its 50% interest in the joint venture. 601, 611 and 651 Gateway consist of three Class A office properties aggregating approximately 768,000 net rentable square feet. The partner contributed three properties and development rights with an agreed upon value aggregating approximately $280.8 million at closing and will contribute cash totaling approximately $69.2 million in the future for its 50% ownership interest in the joint venture. As a result of the partner’s deferred contribution, the Company has an initial approximately 55% interest in the joint venture. Future development projects will be owned 49% by the Company and 51% by its partner. Upon the partner’s contribution, the Company ceased accounting for the joint venture entity on a consolidated basis and is accounting for the joint venture entity on an unconsolidated basis using the equity method of accounting, as it has reduced its ownership interest in the joint venture entity and no longer has a controlling financial or operating interest in the joint venture entity (See Note 5). The Company recognized a gain on the retained and sold interest in the real estate contributed to the joint venture totaling approximately $217.7 million for Boston Properties, Inc. and $222.4 million for Boston Properties Limited Partnership during the nine months ended September 30, 2020 within Gains on Sales of Real Estate on the respective Consolidated Statements of Operations, as the fair value of the real estate exceeded its carrying value. 601, 611 and 651 Gateway contributed approximately $0.2 million of net income to the Company for the period from January 1, 2020 through January 27, 2020 and contributed approximately $2.4 million and $8.5 million of net income to the Company for the three and nine months ended September 30, 2019, respectively.
On February 20, 2020, the Company completed the sale of New Dominion Technology Park located in Herndon, Virginia for a gross sale price of $256.0 million. Net cash proceeds totaled approximately $254.0 million, resulting in a gain on sale of real estate totaling approximately $192.3 million for Boston Properties, Inc. and approximately $197.1 million for Boston Properties Limited Partnership. New Dominion Technology Park is comprised of two Class A office properties aggregating approximately 493,000 net rentable square feet. New Dominion Technology Park contributed approximately $1.6 million of net income to the Company for the period from January 1, 2020 through February 19, 2020 and contributed approximately $2.1 million and $6.3 million of net income to the Company for the three and nine months ended September 30, 2019, respectively.
On June 25, 2020, the Company completed the sale of a portion of its Capital Gallery property located in Washington, DC for a gross sale price of approximately $253.7 million. Net cash proceeds totaled approximately $246.6 million, resulting in a gain on sale of real estate totaling approximately $203.6 million for Boston Properties, Inc. and approximately $207.0 million for Boston Properties Limited Partnership. Capital Gallery is an approximately 631,000 net rentable square foot Class A office property. The portion sold was comprised of approximately 455,000 net rentable square feet of commercial office space. The Company continues to own the land, underground parking garage and remaining commercial office and retail space containing approximately 176,000 net rentable square feet at the property. The sold portion of Capital Gallery contributed approximately $6.3 million of net income to the Company for the period from January 1, 2020 through June 24, 2020 and
contributed approximately $4.0 million and $11.5 million of net income to the Company for the three and nine months ended September 30, 2019, respectively.