BXP revenue rises 4.6% with 7 Times Square sale in talks

BXP is negotiating a $700 million to $750 million sale of 7 Times Square and reported third-quarter revenue of $911.4 million, up 4.6% from a year earlier, according to its earnings report released Wednesday.

Revenue rose from $871.5 million in the same three months last year and from $895.7 million in the second quarter, the report for the period ended Sept. 30 shows. BXP also closed the sales of Sumner Square and 1330 Connecticut Avenue in Washington for $155.4 million, producing net proceeds of about $150.3 million.

For allocators in office funds or REITs, the pending 7 Times Square sale is a live pricing check at $700 million to $750 million. That works out to roughly $583 to $625 per square foot for the 1.2 million-square-foot tower. The REIT is negotiating a contract, not reporting a signed deal, so the per-square-foot figure is a target, not a completed trade.

BXP signed 74 leases covering about 1.2 million square feet in the third quarter, with demand led by artificial intelligence, finance, legal and business services firms, CEO Owen Thomas said. Another 1.3 million square feet of leases sits in the pipeline. Thomas said the firm is negotiating with a tenant for five floors at 343 Madison Avenue, which would bring the planned tower to nearly 70% pre-leased after commitments from C.V. Starr and law firm McDermott Will & Schulte.

The General Motors Building at 767 Fifth Avenue, which BXP and AVRS Partners own jointly, is 99.9% occupied. On the earnings call, BXP president Douglas Linde said the average office rent at 767 Fifth is under $150 per square foot, below what the REIT thinks the space would command today.