Douglas T. Linde
President and Director at Boston Properties
Thanks, Owen. Good morning, everybody. Hope you all had a good New Year.
I'm going to focus my remarks this morning on our leasing activity. As was evident in second press release we sent out last night, our leasing activity press release, we had a pretty strong fourth quarter with activity spread around Boston, New York, San Francisco, and the Metropolitan Washington, DC regions.
We ended the year with an occupancy pick up of about 40 basis points. As we sit here today, in the end of January, we have signed leases for our in-service portfolio that have yet to commence, so they're not in our occupancy figures, of more than 925,000 square feet. That 925,000 square feet represents an additional 180 basis points of potential occupancy increase, and includes about 115,000 square feet of 2023 commencement, so the majority of it is 2022.
We begin 2022 with over 1.4 million square feet of leases in negotiation on spaced in a in-service portfolio. More than 425,000 covers currently vacant space and about 450,000 covers 2022 expirations. During '22, we have about 2.8 million square feet of expirations in the in-service portfolio. Over the last decade, total leasing for this company has a range between 3.7 million square feet in 2020, so that's in the midst of the early pandemic and the economic shutdown, and over 7.7 million square feet in those years where we've signed some pretty large build-to-suit leases.
Now it's true some of the leasing we do each year encompasses early renewals, and we'll talk about some of that today, and leases on new developments, but a significant portion of that leasing we do each year is our near-term renewals and available space in the portfolio. So with 2.8 million square feet of exposure, 925,000 square feet of signed leases, 1.4 million in January are deals in the works is over 2.35 million square feet, and with an annual expected leasing probably somewhere between 3.7 million and 7.7 million, we believe our occupancy is on an upward trajectory as we enter '22.
The second generation statistics this quarter merit a little granular explanation. San Francisco, it's flat. And due to a 50,000 square feet lease down at our North first project where we are doing short-term deals with kick-outs to allow us the flexibility to commence construction on the Station project. The EC leases. So our CBD portfolio had a roll-up of 13%, if you take out that 50,000 square feet lease. In New York City, we terminated a lease with Citibank and went direct with their sub tenants which is operating a conference center. The new rent for that floor is discounted, but City made up a whole through a cash termination payment. Excluding that, New York City had a 5% roll-up.
Now there is no question that Omicron and the wave that hit us in November slowed some return to office dates. However, none of the leases that we have a negotiation have been delayed or impacted by a change in our customers' need for space. With the -- while the month of December and the first two weeks of January were slow, our leasing teams have had a very busy few weeks with more signed LOI's and more active discussions. I would note that the vast majority of those conversations in our CBD locations have continued to be from the financial services and professional services sectors, and that very well may be due to the function of the space that we actually have available in our portfolio.
The only area of our business where we've seen a slight Omicron blip is on parking revenue. Transient collections are down modestly from our forecast for the month of January, and we haven't quite achieved the same anticipated pick-up that we thought we would in monthly permits. But we believe that this will be short-lived and we'll start to see our projections turn in February.
I want to provide a few observations about our regional activities. Let's start with Suburban Boston-Life Sciences. We broke ground on our 880 Winter Street, 243,000 square foot lab conversion in July of 2021, seven months ago. We've signed leases for 165,000 square foot, and we are in negotiation for all of the remaining lab space. The first tenant is expected to occupy during the back half of 2022. Net rents are up 20% percent from our initial underwriting in March of 2021. At 180 CityPoint, we're negotiating a lease for about 50% of the new 329,000 square foot building. Steel erection hasn't started yet and it's hope -- we're expecting it's going to start next month, and we're hopeful to deliver the space in the fourth quarter of '23, but the leasing is that that demonstrates what's going on in the market. We are eagerly awaiting the November expiration of our leases in the Second Avenue buildings we purchased last June, where we can offer 140,000 square feet of lab space and expect a significant roll-up in rents.
With demand continuing to outpace supply, we will commence construction, as Owen said, on another 113,000 square feet at CityPoint, which is in our supplemental. We're calling it 103 CityPoint, very clever. Construction drawings are complete and we expect to break ground this quarter with a late 2024 delivery there.
Now, our traditional Route 120 office leasing is also extremely busy. There is office demand out there. This quarter we agreed to recapture and release 1265 Main Street, a 120,000 square foot office building at CityPoint in Waltham. We completed the 10-year lease as is with a 21% increase in the net rent. At 140 Kendrick Street in Needham, we've announced Wellington's commitment to lease 105,000 square feet, and we found a way to reposition the building as a net-zero installation, which was extremely important to both BXP and Wellington. In addition, we have commitments for two other tenants for the remaining 80,000 square feet of this project, which is currently under lease and expires in November of '22. And finally, we're working on another 73,000 square feet early recapture and backfill at our CityPoint complex. This totaled 378,000 square feet of traditional suburban office leases. These transactions will have rent roll-ups between 7% and 40% on a cash basis.
Our CBD Boston activity this quarter was primarily small transactions. We completed 12 deals for 80,000 square feet. The average markup was 17% on a cash basis. At the moment, there are few large office requirements in the Boston CBD, and there is going to be new construction deliveries in 2023. Our largest block of CBD spaces and exposure is at 100 Federal Street where will we be getting back a 150,000 square feet in early '23.
In New York City during the quarter, we had activity across the portfolio. We executed a full floor lease at Dock 72. We completed 108,000 square foot lease at Times Square Tower. We completed more than 180,000 square feet of leases at 601 Lex, 42,000 square feet at 250 West 55th, 89,000 square feet at the General Motors Building, and over 120,000 square feet in Princeton. The individual mark-to-market in New York vary greatly. You'll recall the single floor I called out last quarter which really retarded our statistics, where the rent went down by 50%. Well, we signed that 15-year lease extension for that floor and the rent is now up 71% on a cash basis. The leases that we completed at the General Motors Building were flat, while the leases at 250 West 55th Street range from up 2% to down 19% on a cash basis.
Our current activity in New York continues to be strong. We have multi-floor lease negotiations underway at GM, 601 Lex, and 510 Madison along with a number of smaller transactions in those buildings. Total activity is an excess of 525,000 square feet. As Owen discussed, we completed the purchase of 360 Park Avenue South. We are working to complete our base building system modification plans, as well as our amenities program. And even though we haven't formally begun to market the asset, we have been responding to increasing tours. Physical construction work will commence during the month of February, so in a couple of weeks.
In the San Francisco CBD, large tech demand has largely been absent from the market. Other than companies upgrading their space through opportunities -- opportunistic sublet space at buildings like our 680 Folsom, the Macy's in the river been subleased -- subleases, and at 350 mission, the sales were sublet. The bulk of the activity on a direct basis has been in the financial district, and it has been confined to the better buildings with professional services and financial firms.
We went on out on a limb this quarter and we asked John Cecconi and his team from CBRE who does work for us to segment the premier buildings in the city. People can debate whether it's the perfect list or not, but it totaled 20 million square feet or about 23% of the market, and includes our entire CBD portfolio. The current vacancy in this portfolio of 20 million square feet is 5.3%. And if you add sublet space, it grow to about 8%.
Now, I've made the point before, but you can't simply look at the overall market availability statistics and make assumptions about where rents and concessions might be in this market. We completed 112,000 square feet of CBD deals this quarter and our cash rents increased by 7% with an average starting rent of $103 a square foot.
Similar to our lab success in Boston, our venture with ARE successfully executed a full building lab lease at 751 Gateway in South San Francisco. The venture intends to commence the conversion of 651 Gateway to a life science building over the next few months. The advantage for this project is time to delivery relative to a new building, where we can achieve six months off versus ground up construction. Last quarter, I described our efforts to gauge pricing as we consider the restart of Platform 16 in San Jose.
Our total base building construction cost increased just over 13% relative to the pricing we had 24 months ago. We continue to see meaningful cost increases and material availability issues across all trades in all of our markets. As an example, the lead time on base building mechanical systems once you have approved drawings has doubled from 20 weeks to 40 weeks, which means you have to make decisions much earlier in a construction schedule or risk delays. We're doing that.
The Class A Silicon Valley leasing markets had a particularly strong 2021, with a very healthy net absorption. And just last week, we got wind of another 500,000 square foot office tenant expansion, not one of what you've heard with the tech titans in the northern Peninsula. And Platform 16, if we start, won't deliver until early 2025.
I'm going to finish my remarks this morning on Greater Washington. During the fourth quarter, we completed 11 office leases in Reston totaling over 140,000 square feet. Every deal was on previously vacant space. Rents have held firm in the low-50s with 2.5% annual bumps, with low-60s with similar bumps for our new project at RTC Next. The first phase of RTC Next has been delivered to Fannie Mae, as Owen described, and we completed our first non-anchor leased during the quarter. This project is 85% lease. It is transformative to the Reston Skyline and is five-minute walk to the heart of the Town Center retail, where we completed over 60,000 square feet of retail leasing again with new tenants on currently vacant space. In the district, we continue to chip away at our current availability with our JV assets, with about 100,000 square feet of leasing. We've delivered 2100 Penn to our anchor tenant for their tenant improvements, and we're working on filling the remainder of that building.
In Boston, in New York, and in the Metropolitan DC area, we have seen a swift reduction in COVID-related cases. Our daily tenant activity is starting to rise again. Employers continue to search for new employees. To circle back to Owen's comments about quality, employers are going to want to use our physical space to encourage their teams to be together. Our mantra has been to create great places and great spaces to allow our customers to use space as a way to attract and retain their talent. If you believe that employees may be spending less time in their office, it's even more important to have the right space and place when they are here.
With that, I'll turn the call over to Mike.