UPDATE 1-Boston Properties second-quarter FFO beats Street

* Q2 FFO $1.12 vs View $1.00

* Raises full-year outlook

* Shares close slightly down, unchanged after hours

NEW YORK, July 27 (Reuters) - Boston Properties Inc (BXP.N), one of the largest Manhattan office landlords, reported lower quarterly funds from operations, due in part to lower rent revenue, but results beat Wall Street's average estimate.

The company reported second-quarter funds from operations (FFO) of $156.9 million, or $1.12 per share, compared with $166.7 million, or $1.33 a share, a year earlier, when there were fewer shares outstanding.

The results beat the average analyst FFO estimate of $1.00 per share, according to Thomson Reuters I/B/E/S. Boston Properties had forecast second-quarter FFO of 97 cents to 99 cents per share

FFO for the second quarter of 2010 included a non-cash charge of 8 cents per share related to the termination of a third-party management and leasing agreement. FFO for the second quarter 2009 included charges of 10 cents a share related to a lease termination and 5 cents a share for a non-cash charge related to the company's Value Added Fund.

FFO, a measure of performance, removes the profit-reducing effect of depreciation, a noncash accounting item.

For the third quarter, Boston Properties sees FFO in the range of $1.01 to $1.03 per share. It raised its 2010 forecast for FFO to a range of $4.24 to $4.29 per share from its prior outlook of $4.06 to $4.16. Analysts had forecast $1.02 for the third quarter and $4.12 for the year.

The company released its earnings after the bell. In after-hours trade, share were unchanged from their close of $81.63 on the New York Stock Exchange. (Reporting by Ilaina Jonas; Editing by Steve Orlofsky)