Over the next 24 months, Boston Properties will likely enjoy one of its most significant and predictable improvements in economic conditions and leasing activity as we witness the end of the COVID-19 pandemic.
Two vaccines with high efficacy rates have been FDA approved, 5.8% of Americans have already received at least one dose of the vaccine.
Approximately $97 million of Boston Properties' FFO decrease in 2020 came from the variable income streams of parking, our single hotel and retail customers, all of which were devastated by the lockdowns.
We have been collecting through the pandemic over 99% of our office rents owed demonstrating the quality of our buildings and office tenants.
Only 7.1% of our leases roll over this year, and we experienced 20% roll-ups on average the last three years, providing a cushion for decreases in market rent caused by the pandemic.
We have signed over 600,000 square feet of leases on currently vacant space that will experience rent commencement in 2021.
We will also be delivering in whole or part three assets into service this year, 100 Causeway, 159 East 53rd Street and 200 West Street, just under one million square feet in the aggregate and 95% leased.
We currently have under development and redevelopment seven projects comprising 3.7 million square feet and $2.2 billion in total investment.
These projects are 88% pre-leased, fully funded with cash on our balance sheet and projected to generate cash yields on cost at stabilization of approximately 7%.
In addition, we recently delivered three Class A urban apartment complexes in Boston, Reston and Oakland, with an aggregate of 1,350 units that are only 56% leased and have substantial income upside as the economy reopens.
We expect the income from delivering this development pipeline to add 3.4% annually to our FFO growth over the next four years.
We also anticipate starts this year of over $800 million, the majority of which are new life science developments and conversions.
And lastly, we own or control land aggregating over 16 million square feet of potential office, lab and residential development, which we will commence as dictated by market conditions.
Our portfolio is dominated by Class A urban assets many among the leading buildings in their respective markets, such as Salesforce Tower, the General Motors Building, 200 Clarendon Street and Kendall Center.
For example, VTS reported from their database that tours for Class A buildings in New York City went from 38% of total before the pandemic to 54% during the pandemic.
In 2020, we were able to lease 3.7 million square feet with a weighted average lease term of 8.6 years, which is around 60% of our recent annual leasing averages, while the leasing activity in our markets was approximately 40% of recent annual averages.
Because of the pandemic and the variability in our parking, retail and hotel income streams, Boston Properties' FFO dropped approximately 15% the last three quarters of 2020 versus prepandemic levels, which is clearly disconnected from our stock price, which has dropped 37% over the same period.
But 52% want a hybrid model with more time to work-from-home for convenience and safety from COVID-19, fears of which should dissipate over time.
However, 90% of those employees surveyed won an assigned workstation when in the office.
And while only 21% of those surveyed had a private office layout, 47% wanted it.
At our current share price, the look-through cap rate on our portfolio is 5.9%.
High-quality office assets comparable to much of Boston Properties' portfolio are trading at sub-5% cap rates.
Volumes were down 45% in the fourth quarter versus the fourth quarter in 2019, but were up 59% sequentially from the third quarter.
Office was no more out of favor than other asset classes after the pandemic as office transaction volume was 29% of total commercial real estate volume, both in 2019 and the last three quarters of 2020.
Just in life science, life science is a portfolio dominated by a leasehold interest in University Park in Cambridge sold for $3.4 billion, around $1,500 a square foot and a mid-4% cap rate with roll-up potential.
And a partial interest in Discovery Park in Cambridge was sold for $720 million, representing $1,190 a square foot and a 4.7% cap rate.
And in office, 410 10th Avenue in New York City sold for $950 million, which equated to $1,490 a square foot and a 4.5% cap rate.
And 510 Townsend and 505 Brannan streets in San Francisco sold for a combined $570 million, $1,280 a square foot and a 5% cap rate.
And in the Seattle CBD, a leasehold interest in 2NU sold for $700 million, $1,020 a square foot and a 4.7% cap rate and 1918 8th Avenue sold for $625 million, $940 a square foot and also a 4.7% cap rate.
We currently have $3.2 billion in liquidity.
And after the redemption of our unsecured bonds and fully funding our current development pipeline, we'll have $1.5 billion of liquidity remaining.
We have been more actively monetizing in-service assets, having completed $570 million in gross sales in 2020, and we expect a similarly elevated level of activity this year.
As mentioned, we also intend to invest more aggressively into life science real estate and have 5.8 million square feet of new development and redevelopment projects under our control located primarily in the life science hubs of Cambridge, Waltham and South San Francisco.
We signed an LOI for a 70,000 square foot tenant that's going to need space in December of 2021.
And just yesterday, Amazon announced in Boston that they are committing to another 630,000 square feet to be built office building and bringing 3,000 additional jobs to the Boston CBD.
In Midtown Manhattan, after the Great recession, according to CBRE, from 2008 to 2009, about 24 million square feet of space was put on the sublet market.
Between 2009 and 2010, 13.6 million or 57% of that was withdrawn from the market.
The Boston Properties' office portfolio ended the year at 90.1% occupied.
The quarterly sequential drop is entirely due to the addition of Dock 72 at 33% leased into the in-service portfolio.
As Owen said, we have 600,000-plus square feet of signed leases, 134 basis points in our in-service portfolio that has not yet commenced revenue and hence is still defined as vacant, but it has been leased.
We completed another 1.2 million square feet of leasing during the quarter.
The cash starting rent on this full floor lease will be 34% higher than the expiring rent, and there are future rent increases.
The cash rents on the other four leases had a weighted average increase of about 30%.
We continue to have additional activity in our CBD Boston portfolio, albeit with a number of smaller tenants under 10,000 square feet.
I also want to note that we finally obtained possession of the 120,000 square foot 2-story former Lord & Taylor Building on Boylston Street during the early part of this month.
In our suburban Boston portfolio, we completed 226,000 square feet of new leasing, including all of the remaining space at 20 CityPoint, first generation.
This is in addition to the life science lease we did at 200 West Street.
The cash rent on the second-generation leases, about 150,000 square feet was up an average of 23% on a cash basis.
In Waltham, we're negotiating a 60,000 square foot lease extension, a lease with a new tenant for a 63,000 square foot block of space and we're responding to a number of large life science lab requirements.
At the moment, we don't have any ready-to-go vacant lab space, but we hope to begin our conversion of 880 Winter Street 220,000 square feet during the second quarter.
And our 300,000 square foot 180 CityPoint lab building has been fully designed, fully permitted, and we are simply waiting final construction bids over the next few months.
This quarter, we completed six renewals at our VA 95 single-story park, totaling about 218,000 square feet.
In addition to the VW commitment in Reston Next, we completed another 82,000 square feet in the town center in Reston.
In total, in 2020, we completed 1.15 million square feet of leasing in Reston Town Center.
But we have a good start to 2021 with lease negotiations ongoing for an additional 60,000 square foot block of space.
In Reston Town Center, rents are basically flat to slightly down 1% to 2% on the relet, since the expiring cash rents have been increasing contractually by 2.5% to 3% for the last 10 years, and they will continue to do so on a going-forward basis.
We completed 24,000 square feet of leasing during the quarter, and we're negotiating over 120,000 square feet of leases as we speak.
In New York City, we executed our lease with Ascena at Times Square Tower for about 132,000 square feet of office space.
We completed two floor deals in the New York City market, each 31,000 square feet at 601 Lex, one was a one-year extension, and the second was a 10-year renewal and the cash rent decreased about 8% on that renewal.
We also did four small transactions at 250 West 55th Street in Time Square Tower totaling 26,000 square feet, three were short term and one was a 10-year deal.
We're negotiating a full floor of transaction at 399 Park on a space that's not expiring until the end of 2021.
When we talk about California, you need to appreciate the fact that the state has been strongly discouraging tenants from asking their employees to go to their offices for the last 11 months.
Just to put this year in perspective, from 2017 to 2019, there were, on average, 10 -- excuse me, 14 tech company leases per year in excess of 100,000 square feet.
Our San Francisco assets are 95% leased, and we have 280,000 square feet expiring in '21.
The third quarter produced just three transactions totaling about 23,000 square feet at EC.
And during the fourth quarter, we did another four leases, all renewals, up about 18% on a cash basis totaling 20,000 square feet, it's pretty slow there.
In South San Francisco, our Gateway JV is planning the construction commencement of 751 Gateway, a 230,000 square feet ground up lab development to begin over the next few months, followed by the conversion of 651 Gateway, which will be a renovated building, if we're able to relocate the existing tenant there.
two technology companies did 100,000 square foot plus expansions during the quarter, and there are three active requirements right now in the market in excess of 200,000 square feet.
In Santa Clara, we're going to be taking our 218,000 square foot Peterson Way building out of service when the lease expires in the second quarter of '21.
This was a covered land play and contributed about $4.8 million of revenue in 2020.
We have entitlements for a 630,000 square foot campus, permitted and improved, ready to go.
And as I said at the outset, we signed a 70,000 square foot LOI at Colorado Center from a new tenant.
We also continue to execute on new and renewal office lease requirements as evidenced by the 1.2 million square feet of leasing in the fourth quarter and the 3.7 million square feet of leasing in 2020 overall, despite the pandemic-related shutdowns.
The first is a $60 million noncash impairment of our equity investment in Dock 72.
Our 670,000 square foot development we put into service in the Brooklyn Navy Yard.
This investment is held in an unconsolidated joint venture, where we own 50%.
Also, while the $0.35 per share charge is a deduction from net income, it is added back to arrive at FFO.
Dock 72 is only 33% leased, as Doug said.
We see Dock 72 as a unique situation, and we do not anticipate any additional impairments in the portfolio.
The rest of our development pipeline is very well leased at 88%, our in-service portfolio is over 90% leased and, honestly, most of the assets have significant embedded gains.
The second charge is a $38 million or $0.22 per share noncash charge to net income and FFO for the write-off of all accrued rental income for tenants in the co-working industry.
For the fourth quarter, our reported FFO was $1.37 per share.
If you exclude the accrued rent charge, our fourth quarter FFO would have been $1.59 per share and in line with consensus and the expectations that we shared with you last quarter.
We have provided first quarter 2021 guidance for FFO of $1.53 to $1.57 per share.
At the midpoint, this is $0.04 per share lower than our fourth quarter 2020 FFO before charges.
The decline is entirely due to approximately $0.10 per share of seasonally higher anticipated G&A.
If you look back historically, we typically recorded 30% of our annual G&A expense in the first quarter.
We are redeeming our $850 million bond issuance in mid-February with cash on hand.
These bonds have a yield of 4.3%, and there will be no prepayment charge.
We're currently earning close to 0 on our cash.
If you simply annualize the midpoint of our first quarter guidance, you get to about $6.20 per share.
For modeling purposes, we suggest you consider adding the following to the Q1 annualized FFO of $6.20 per share: $0.19 per share for the impact of lower G&A for the rest of the year; $0.08 per share from lower interest expense due to the bond redemption; and $0.05 per share of incremental FFO from new developments coming online, including 159 East 53rd Street, which is 96% leased to NYU and where we expect to commence revenue in the second quarter; 100 Causeway Street in Boston, which is 94% leased with projected revenue phasing in starting in the third quarter; and 200 West Street, our life science development in Waltham, which is 100% leased and is projected to deliver in December.
So adjusting our first quarter annualized run rate for these known items gets to approximately $6.52 per share for 2021.
Their contribution is nearly $30 million lower on a quarterly basis than what we saw prepandemic.
Our rollover for 2021 is 3.2 million square feet.
As Doug described, we already have 610,000 square feet of leases signed that will take occupancy of currently vacant space this year.
Overall, we expect our year-end 2021 occupancy to be flat to down 100 basis points compared to current occupancy.
It's also worth noting that we have a meaningful amount of free rent that burned off in 2020 that will boost our cash same-property performance and AFFO in 2021, specifically at 399 Park Avenue, we had 450,000 square feet of space in build out and under free rent for nine months in 2020 that is now in cash rent.
And at the General Motors Building, 160,000 square feet of office space and a portion of our retail was under free rent for most of 2020 and are now paying cash rent.
This showed up in our results in the fourth quarter with a $10 million increase in same-property cash NOI sequentially from Q3 to Q4.
And we have $2.2 billion of leased developments coming online over the next couple of years, all of which should drive future earnings growth and value.

Summary:
We completed another 1.2 million square feet of leasing during the quarter.
We also continue to execute on new and renewal office lease requirements as evidenced by the 1.2 million square feet of leasing in the fourth quarter and the 3.7 million square feet of leasing in 2020 overall, despite the pandemic-related shutdowns.
For the fourth quarter, our reported FFO was $1.37 per share.
We have provided first quarter 2021 guidance for FFO of $1.53 to $1.57 per share.