To emphasize his point, Linde cited Boston Properties' strategyof operating "at the top end of the real estate markets in selectareas with barriers to supply," commenting that the location andthe leasing composition of a portfolio really matters in times likethese. For Boston Properties, he says it means that "while we dovery well in good times, on a relative basis, we do even better inmore challenging times." The Boston Properties' president outlinedthe REIT's performance in a market-by-market summary.

Office demand in Boston remains pretty strong, Linde said. "Wecontinue to respond to requests for proposals for large tenants. Infact, there are over 15 that are greater than 70,000 sf that areactive today in the market at our proposed developments in Walthamand Weston," he said. In addition, he pointed out that inCambridge, Google and EMC and VMware and Akamai and Microsoft haveall expanded during the last few quarters, leaving a vacancy ratethere of just under 8% in Kendall Square. He added that the BostonCBD has been shielded from the job losses stemming from thecontinued credit crisis because the financial firms in Boston werealready consolidated in a trend that has taken place over the past10 years.

By contrast in New York City, reductions in force by majorfinancial firms have put significant blocks of space on the market."One of our brokers has tracked about 20,000 job lossescorresponding to about 1.4 million sf of sublet space from thosefinancial services firms and we are certainly not immune to that,"Linde said. For example, Citibank is offering 250,000 sf inCitigroup Center. Boston Properties is in discussions with a lawfirm to relocate and expand into all of the available Citibankspace when they can make it available, which will probably not beuntil 2009, he said.