DENVER—A fireside chat panel between moderator Thomas Hynes Jr., CEO of Colliers International Boston, and Owen Thomas, CEO of Boston Properties, revealed to attendees at NAIOP’s Development ’14 conference why the powerhouse firm has been so successful and what it says about the office market. One of the reasons for this success has been Boston Properties’ ability to satisfy the office needs of both traditional and creative tenants, said Thomas.

When asked why the firm concentrates on certain markets instead of having a national platform, Thomas said Washington, DC; Boston; New York City; and San Francisco Bay over time “have performed on average better than the US and have rewarded our shareholders.” The return on investment in projects is what earns money for its shareholders, so the firm chooses markets “where the highs get higher and the lows get higher,” Thomas added.

The firm also asses both the capital markets and the property markets when making investment decisions, adding that the market has seen a long, slow recovery since the depths of the recession. Now is the time for the firm to be developing, rather than acquiring assets, he said. “In all four markets, we’re building at replacement cost. Why should we go out and buy older buildings when we can build new ones?” When feasible, Boston Properties also works with foreign investors seeking a local developer with which to partner.

Market recovery in the property sectors has been “completely uneven,” Thomas pointed out. Technology and energy have been growth drivers in many markets and have been responsible for the lion’s share of net absorption in those markets, with San Francisco topping the list. “DC is suffering more, since the CBD and Reston, VA, are driven by law firms—they’ve hit a slower patch.”

The firm boasts a robust national management team, but its regional CEOs have local autonomy, which serves it well, Thomas said. “We get involved where there’s a big capital need,” but not for everyday decisions.

About half of its tenants are considered traditional FIRE tenants—financial, insurance, real estate—and half are creative and tech firms, and Thomas said Boston has worked with struggling FIRE tenants on their leases, allowing them to give back space as needed in order to renew. It is also making a conscious effort to seek out new areas of its markets, such as Midtown South and Brooklyn in New York, in order to grow.