LOS ANGELES, Aug 01, 2012 (BUSINESS WIRE) –
Kilroy Realty Corporation


/quotes/zigman/171049/quotes/nls/krc KRC
-0.27%



today reported
financial results for its second quarter ended June 30, 2012, with a net
loss available to common stockholders of $800,000, or $0.02 per share,
compared to a net loss available to common stockholders of $317,000, or
$0.01 per share, in the second quarter of 2011. Revenues from continuing
operations in the second quarter totaled $103.9 million, up from $88.4
million in the prior year’s second quarter. Funds from operations
(FFO) for the period totaled $39.5 million, or $0.55 per share, compared
to $31.6 million, or $0.52 per share, in the year-earlier period.

Results for the second quarter of 2012 include $0.03 per share of
acquisition-related expenses, and the issuance of 575,689 common shares
under the company’s at-the-market stock offering program at a weighted
average price of $46.05, net of selling commissions.

For the first six months of 2012, KRC reported net income available to
common stockholders of $66.7 million, or $1.00 per share, compared to
$717,000, or less than $0.01 per share, in the first half of 2011.
Revenues from continuing operations in the six-month period totaled
$203.3 million, up from $172.2 million in the same period of 2011. FFO
for the first half of 2012 totaled $72.5 million, or $1.04 per share,
compared to $61.8 million, or $1.06 per share, in the first half of
2011. Net income for first half of 2012 included approximately $72.8
million of net gains from property dispositions. All per share amounts
in this report are presented on a diluted basis.

At June 30, 2012, the company’s stabilized portfolio totaled
approximately 15.6 million square feet and was 90.0% occupied. Occupancy
declined from 91.6% in the prior quarter primarily due to the lease
expirations of two tenants in San Diego as well as an industrial tenant
move-out in Orange County.

Since the end of the first quarter, KRC has completed the purchase of
five office buildings in four transactions aggregating approximately 1.2
million square feet of space for an aggregate purchase price of
approximately $410 million. The company also expanded its development
platform into Northern California with the purchase of 690 E.
Middlefield Road in Mountain View, California and 329 Brannan Street in
the SOMA submarket of San Francisco that upon completion are estimated
to have a total investment of approximately $285 million. A summary of
these transactions is as follows:

–
In May, the company purchased 690 E. Middlefield Road in Mountain
View, California for a purchase price of $74.5 million, where it will
develop, own and manage a 341,000 square-foot office campus under a
15-year lease for Synopsys, Inc.


/quotes/zigman/78740/quotes/nls/snps SNPS
-0.63%



, the global leader in
electronic design automation. The Synopsys office campus represents
KRC’s first ground-up development project in the greater San Francisco
Bay Area and will have a projected total investment of approximately
$200 million. The fully entitled office project will include two
five-story Class A office buildings with state-of-the-art
infrastructure and amenities, designed and pre-registered to meet LEED
Gold certification requirements.

–
In June, the company acquired, in two separate transactions, a
three-building office campus located on the waterfront in the Lake
Union submarket of Seattle, Washington. The 420,000 square foot office
project was purchased for approximately $144.6 million and is
currently 99% leased. As part of the acquisition, the Company assumed
a mortgage loan of approximately $34.0 million that bears interest at
a rate of 5.09% and matures in August 2015.

–
In July, the company acquired Skyline Tower, a 417,000 square-foot,
24-story, Class A office building in Bellevue, Washington for
approximately $186 million. The LEED Silver certified property is
located two blocks from the company’s Key Center office building and
one block north of the Bellevue Transit Center. Skyline Tower is
currently 92% leased. As part of the acquisition, the company assumed
a mortgage loan of approximately $84 million that bears interest at a
rate of 6.37% and matures in April 2013.

–
In July, the company acquired 329 Brannan Street, an office
development opportunity in the heart of San Francisco’s SOMA district
for approximately $18.5 million. The site is zoned for approximately
5.0 FAR coverage and the company intends to build a six-level office
building designed to appeal to the area’s growing community of
technology and media companies.

–
In July, the company acquired Sunset Media Center, a 322,000 square
foot, 22-story, Class A office building located in the Hollywood
submarket of Los Angeles, California for a purchase price of
approximately $79 million. The building is currently 87% leased. As
part of the acquisition, the company issued approximately $5 million
in common limited partnership units of Kilroy Realty, L.P. and assumed
a mortgage loan of approximately $54 million that bears interest at a
rate of 5.23% and matures in January 2016.

In late June, KRC obtained a $97.0 million non-recourse mortgage secured
by two office projects. The mortgage has a term of 15 years, maturing on
July 1, 2027, and bears interest at a rate of 4.48%. The company used
the loan proceeds to pay down a portion of the outstanding balance on
its credit facility.

“KRC’s expanding operational footprint and management expertise in top
quality real estate markets up and down the West Coast continue to
generate significant opportunities for profitable growth and long-term
value creation,” said John Kilroy, Jr., the company’s president and
chief executive officer. “With the talent and market knowledge now
represented on our team, we’re well-positioned to compete for and
execute attractive acquisition and development projects from Seattle to
San Diego. Equally important, we will continue to pursue these
opportunities with financial discipline, recognizing that a strong
balance sheet is essential in what remains an uncertain economic
environment.”

KRC management will discuss updated earnings guidance for fiscal 2012
during the company’s August 2, 2012 earnings conference call. The call
will begin at 10:00 a.m. Pacific Time and last approximately one hour.
Those interested in listening via the Internet can access the conference
call at
http://www.kilroyrealty.com .
Please go to the website 15 minutes before the call and register. It may
be necessary to download audio software to hear the conference call.
Those interested in listening via telephone can access the conference
call at (888) 679-8035 reservation #77332020. A replay of the conference
call will be available via phone through August 9, 2012 at (888)
286-8010, reservation #61086733, or via the Internet at the company’s
website.

About Kilroy Realty Corporation. Kilroy Realty Corporation, a
member of the SP Small Cap 600 Index, is a real estate investment trust
active in the office and industrial property sectors. For over 60 years,
the company has owned, developed, acquired and managed real estate
assets primarily in the coastal regions of Los Angeles, Orange County,
San Diego, greater Seattle and the San Francisco Bay Area. At June 30,
2012, the company owned 12.2 million rentable square feet of commercial
office space and 3.4 million rentable square feet of industrial space.
More information is available at
http://www.kilroyrealty.com .

Forward Looking Statements. This press release contains
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended. Forward-looking statements are based
on our current expectations, beliefs and assumptions, and are not
guarantees of future performance, results or events. Forward-looking
statements are inherently subject to uncertainties, risks, changes in
circumstances, trends and factors that are difficult to predict, many of
which are outside of our control. Accordingly, actual performance,
results and events may vary materially from those indicated in
forward-looking statements, and you should not rely on forward-looking
statements as predictions of future performance, results or events.
Numerous factors could cause actual future performance, results and
events to differ materially from those indicated in forward-looking
statements, including, among others: risks associated with investment in
real estate assets, which are illiquid, and with trends in the real
estate industry; competitive market conditions; the ability to complete
potential acquisitions and dispositions on announced terms; the ability
to successfully operate acquired properties; the availability of cash
for debt service and exposure of risk of default under debt obligations;
government regulations that may affect development, redevelopment and
use of properties; and the ability to successfully complete development
and redevelopment projects on schedule and within budgeted amounts.
These factors are not exhaustive. For a discussion of additional factors
that could materially adversely affect our business and financial
performance, see the factors included under the caption “Risk Factors”
in our annual report on Form 10-K for the year ended December 31, 2011,
quarterly report on Form 10-Q for the quarter ended March 31, 2012, and
our other filings with the Securities and Exchange Commission. All
forward-looking statements are based on currently available information
and speak only as of the date on which they are made. We assume no
obligation to update any forward-looking statement made in this press
release that becomes untrue because of subsequent events, new
information or otherwise, except to the extent required in connection
with ongoing requirements under Federal securities laws.

                                                                      KILROY REALTY CORPORATION
                                                                      SUMMARY QUARTERLY RESULTS
                                                          (unaudited, in thousands, except per share data)
        -----------------------------------------------------------------------------------------------------------------------------------
                                                                                      Three Months      Three Months        Six Months         Six Months
                                                                                          Ended             Ended              Ended              Ended
                                                                                      June 30, 2012     June 30, 2011      June 30, 2012      June 30, 2011
                                                                                   ---------------    --------------    ---------------    ---------------
        Revenues from continuing operations                                           $ 103,922          $ 88,390          $ 203,332          $ 172,163
        Revenues including discontinued operations                                    $ 103,922          $ 92,064          $ 204,335          $ 180,189
        Net (loss) income available to common stockholders(1)                         $    (800)        $   (317)        $  66,740          $     717
        Weighted average common shares outstanding - basic                               68,345            57,686             65,997             55,009
        Weighted average common shares outstanding - diluted                             68,345            57,686             65,997             55,009
        Net (loss) income available to common stockholders per share - basic (1)      $   (0.02)        $  (0.01)        $    1.00          $    0.00
        Net (loss) income available to common stockholders per share -                $   (0.02)        $  (0.01)        $    1.00          $    0.00
        diluted (1)
        Funds From Operations (1), (2), (3)                                           $  39,508          $ 31,643          $  72,498          $  61,770
        Weighted average common shares/units outstanding - basic (4)                     71,226            60,337             68,799             57,634
        Weighted average common shares/units outstanding - diluted (4)                   72,473            60,817             69,815             58,010
        Funds From Operations per common share/unit - basic (1), (4)                  $    0.55          $   0.52          $    1.05          $    1.07
        Funds From Operations per common share/unit - diluted (1), (4)                $    0.55          $   0.52          $    1.04          $    1.06
        Common shares outstanding at end of period:                                                                           68,928             58,464
        Common partnership units outstanding at end of period                                                                  1,718              1,718
                                                                                                                        -------------      -------------
               Total common shares and units outstanding at end of period                                                     70,646             60,182
                                                                                                                           June 30, 2012      June 30, 2011
                                                                                                                        ------------------ ------------------
        Stabilized portfolio occupancy rates:
               Office                                                                                                           89.3 %             87.9 %
               Industrial                                                                                                       92.5 %             97.6 %
                                                                                                                        -----------------  -----------------
                   Weighted average total                                                                                       90.0 %             90.2 %
               Los Angeles and Ventura Counties                                                                                 88.0 %             84.0 %
               San Diego County                                                                                                 87.5 %             88.4 %
               Orange County                                                                                                    92.7 %             96.7 %
               San Francisco Bay Area                                                                                           91.4 %             93.1 %
               Greater Seattle                                                                                                  93.8 %             90.4 %
                                                                                                                        -----------------  -----------------
                    Weighted average total                                                                                      90.0 %             90.2 %
        Total square feet of stabilized properties owned at end of period:
               Office                                                                                                         12,227             11,466
               Industrial                                                                                                      3,413              3,605
                                                                                                                        -------------      -------------
                      Total                                                                                                   15,640             15,071

        (1)   Net (Loss) Income Available to Common Stockholders includes a net
              gain on dispositions of discontinued operations of $72.8 million for
              the six months ended June 30, 2012. In addition, Net (Loss) Income
              Available to Common Stockholders and Funds from Operations for the
              six months ended June 30, 2012 include a non-cash charge of $4.9
              million related to the original issuance cost of the Series E and F
              Preferred Stock that were redeemed on April 16, 2012.
        (2)   Reconciliation of Net (Loss) Income Available to Common Stockholders
              to Funds From Operations and management statement on Funds From
              Operations are included after the Consolidated Statements of
              Operations.
        (3)   Reported amounts are attributable to common stockholders and common
              unitholders.
        (4)   Calculated based on weighted average shares outstanding including
              participating share-based awards and assuming the exchange of all
              common limited partnership units outstanding.

                                                  KILROY REALTY CORPORATION CONSOLIDATED
                                                              BALANCE SHEETS
                                                         (unaudited, in thousands)
        ----------------------------------------------------------------------------------------------------------------
                                                                                           June 30, 2012         December 31, 2011
                                                                                      -----------------------  --------------------
        ASSETS
        ---------------------------------------------------------------------------
        REAL ESTATE ASSETS:
               Land and improvements                                                        $   576,433              $   537,574
               Buildings and improvements                                                     3,137,665                2,830,310
               Undeveloped land and construction in progress                                    557,657                  430,806
                                                                                      ------------------       ------------------
                                                                                              4,271,755                3,798,690
                      Total real estate held for investment
               Accumulated depreciation and amortization                                       (801,083)               (742,503)
                                                                                      ----------------------   -------------------
                      Total real estate held for investment, net                              3,470,672                3,056,187
        Real estate assets and other assets held for sale, net                           --                   84,156
        Cash and cash equivalents                                                                18,111                    4,777
        Restricted cash                                                                              97                      358
        Marketable securities                                                                     6,546                    5,691
        Current receivables, net                                                                  7,643                    8,395
        Deferred rent receivables, net                                                          110,689                  101,142
        Deferred leasing costs and acquisition-related intangible assets, net                   168,488                  155,522
        Deferred financing costs, net                                                            18,919                   18,368
        Prepaid expenses and other assets, net                                                   46,357                   12,199
                                                                                      ------------------       ------------------
                      TOTAL ASSETS                                                          $ 3,847,522              $ 3,446,795
                                                                                      ======= =========        ======= =========
        LIABILITIES, NONCONTROLLING INTEREST AND
        EQUITY
        ---------------------------------------------------------------------------
        LIABILITIES:
               Secured debt                                                                 $   381,097              $   351,825
               Exchangeable senior notes, net                                                   161,844                  306,892
               Unsecured debt, net                                                            1,130,732                  980,569
               Unsecured line of credit                                                         102,000                  182,000
               Accounts payable, accrued expenses and other liabilities                          98,940                   81,713
               Accrued distributions                                                             25,975                   22,692
               Deferred revenue and acquisition-related intangible liabilities, net             108,462                   79,781
               Rents received in advance and tenant security deposits                            31,768                   26,917
               Liabilities and deferred revenue of real estate assets held for sale      --                   13,286
                                                                                      ------------------       ------------------
                      Total liabilities                                                       2,040,818                2,045,675
                                                                                      ------------------       ------------------
        NONCONTROLLING INTEREST:
               7.45% Series A Cumulative Redeemable Preferred units of the                       73,638                   73,638
               Operating Partnership
        EQUITY:
               Stockholders' Equity
                    7.80% Series E Cumulative Redeemable Preferred stock                 --                   38,425
                    7.50% Series F Cumulative Redeemable Preferred stock                 --                   83,157
                    6.875% Series G Cumulative Redeemable Preferred stock                        96,155           --
                    Common stock                                                                    689                      588
                    Additional paid-in capital                                                1,856,431                1,448,997
                    Distributions in excess of earnings                                        (259,495)               (277,450)
                                                                                      ----------------------   -------------------
                          Total stockholders' equity                                          1,693,780                1,293,717
                                                                                      ------------------       ------------------
               Noncontrolling Interest
                    Common units of the Operating Partnership                                    39,286                   33,765
                                                                                      ------------------       ------------------
                          Total equity                                                        1,733,066                1,327,482
                                                                                      ------------------       ------------------
                    TOTAL LIABILITIES, NONCONTROLLING INTEREST AND EQUITY                   $ 3,847,522              $ 3,446,795
                                                                                      ======= =========        ======= =========

                                                                     KILROY REALTY CORPORATION CONSOLIDATED
                                                                            STATEMENTS OF OPERATIONS
                                                                (unaudited, in thousands, except per share data)
        -----------------------------------------------------------------------------------------------------------------------------------------------
                                                                                         Three Months          Three Months          Six Months          Six Months
                                                                                             Ended                 Ended                Ended               Ended
                                                                                         June 30, 2012         June 30, 2011        June 30, 2012       June 30, 2011
                                                                                     ------------------    ------------------    ---------------    ------------------
        REVENUES:
              Rental income                                                                $  94,265             $  80,158          $ 184,484             $ 157,155
              Tenant reimbursements                                                            9,065                 7,130             17,369                13,152
              Other property income                                                              592                 1,102              1,479                 1,856
                                                                                     ----------------      ----------------      -------------      ----------------
                      Total revenues                                                         103,922                88,390            203,332               172,163
                                                                                     ----------------      ----------------      -------------      ----------------
        EXPENSES:
              Property expenses                                                               21,196                17,356             38,731                34,865
              Real estate taxes                                                                8,881                 8,127             17,270                16,017
              Provision for bad debts                                                 --                   120                  2                   146
              Ground leases                                                                      615                   424              1,417                   763
              General and administrative expenses                                              9,251                 7,440             18,018                14,000
              Acquisition-related expenses                                                     1,813                 1,194              3,341                 1,666
              Depreciation and amortization                                                   40,624                31,378             77,370                59,819
                                                                                     ----------------      ----------------      -------------      ----------------
                      Total expenses                                                          82,380                66,039            156,149               127,276
                                                                                     ----------------      ----------------      -------------      ----------------
        OTHER (EXPENSES) INCOME:
              Interest income and other net investment (losses) gains                           (110)                  58                374                   242
              Interest expense                                                               (19,155)             (21,228)          (40,318)             (42,104)
                                                                                     --------------------  --------------------  -----------------  --------------------
                      Total other (expenses) income                                          (19,265)             (21,170)          (39,944)             (41,862)
        INCOME FROM CONTINUING OPERATIONS                                                      2,277                 1,181              7,239                 3,025
        DISCONTINUED OPERATIONS:
              Income from discontinued operations                                     --                 2,291                900                 5,314
              Net gain on dispositions of discontinued operations                     --        --             72,809        --
                                                                                     ----------------      ----------------      -------------      ----------------
                      Total income from discontinued operations                       --                 2,291             73,709                 5,314
                                                                                     ----------------      ----------------      -------------      ----------------
        NET INCOME                                                                             2,277                 3,472             80,948                 8,339
              Net loss (income) attributable to noncontrolling common units of the                20                    10             (1,775)                 (24)
              Operating Partnership
                                                                                     --------------        --------------        -----------  ----  --------------  ----
        NET INCOME ATTRIBUTABLE TO KILROY REALTY CORPORATION                                   2,297                 3,482             79,173                 8,315
        PREFERRED DISTRIBUTIONS AND DIVIDENDS:
              Distributions on noncontrolling cumulative redeemable preferred                 (1,397)              (1,397)           (2,794)              (2,794)
              units of the Operating Partnership
              Preferred dividends                                                             (1,700)              (2,402)           (4,721)              (4,804)
              Original issuance costs of preferred stock called for redemption        --        --             (4,918)      --
                                                                                     ----------------      ----------------      -----------------  ----------------
                      Total preferred distributions and dividends                             (3,097)              (3,799)          (12,433)              (7,598)
        NET (LOSS) INCOME AVAILABLE TO COMMON STOCKHOLDERS                                 $    (800)           $    (317)        $  66,740             $     717
                                                                                     ======= ======= ====  ======= ======= ====  ==== =======       ======= =======
        Weighted average common shares outstanding - basic                                    68,345                57,686             65,997                55,009
        Weighted average common shares outstanding - diluted                                  68,345                57,686             65,997                55,009
        Net (loss) income available to common stockholders per share - basic               $   (0.02)           $   (0.01)        $    1.00             $    0.00
                                                                                     ======= ======= ====  ======= ======= ====  ==== =======       ======= =======
        Net (loss) income available to common stockholders per share -                     $   (0.02)           $   (0.01)        $    1.00             $    0.00
        diluted
                                                                                     ======= ======= ====  ======= ======= ====  ==== ======= ====  ======= ======= ====

                                                                        KILROY REALTY CORPORATION FUNDS FROM
                                                                                     OPERATIONS
                                                                  (unaudited, in thousands, except per share data)
        ----------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                   Three Months          Three Months         Six Months        Six Months
                                                                                                       Ended                 Ended               Ended             Ended
                                                                                                   June 30, 2012         June 30, 2011       June 30, 2012     June 30, 2011
                                                                                               ------------------    ------------------    --------------    --------------
        Net (loss) income available to common stockholders                                           $    (800)           $    (317)        $ 66,740             $     717
                 Adjustments:
                        Net (loss) income attributable to noncontrolling common units of the               (20)                 (10)           1,775                    24
                        Operating Partnership
                        Depreciation and amortization of real estate assets                             40,328                31,970            76,792                61,029
                        Net gain on dispositions of discontinued operations                     --        --           (72,809)      --
                                                                                               ----------------      ----------------      ----------------  ----------------
        Funds From Operations (1)                                                                    $  39,508             $  31,643          $ 72,498             $  61,770
                                                                                               ======= =======       ======= =======       ==== ======       ======= =======
        Weighted average common shares/units outstanding - basic                                        71,226                60,337            68,799                57,634
        Weighted average common shares/units outstanding - diluted                                      72,473                60,817            69,815                58,010
        Funds From Operations per common share/unit - basic (2)                                      $    0.55             $    0.52          $   1.05             $    1.07
                                                                                               ======= =======       ======= =======       ==== ======       ======= =======
        Funds From Operations per common share/unit - diluted (2)                                    $    0.55             $    0.52          $   1.04             $    1.06
                                                                                               ======= =======       ======= =======       ==== ======       ======= =======

        (1)   The company calculates FFO in accordance with the White Paper on FFO
              approved by the Board of Governors of NAREIT. The White Paper
              defines FFO as net income or loss calculated in accordance with
              GAAP, excluding extraordinary items, as defined by GAAP, gains and
              losses from sales of depreciable real estate and impairment
              write-downs associated with depreciable real estate, plus real
              estate-related depreciation and amortization (excluding amortization
              of deferred financing costs and depreciation of non-real estate
              assets), and after adjustment for unconsolidated partnerships and
              joint ventures.
              Management believes that FFO is a useful supplemental measure of the
              company's operating performance. The exclusion from FFO of gains and
              losses from the sale of operating real estate assets allows
              investors and analysts to readily identify the operating results of
              the assets that form the core of the company's activity and assists
              in comparing those operating results between periods. Also, because
              FFO is generally recognized as the industry standard for reporting
              the operations of REITs, it facilitates comparisons of the company's
              operating performance to other REITs. However, other REITs may use
              different methodologies to calculate FFO, and accordingly, the
              company's FFO may not be comparable to all other REITs.
              Implicit in historical cost accounting for real estate assets in
              accordance with GAAP is the assumption that the value of real estate
              assets diminishes predictably over time. Since real estate values
              have historically risen or fallen with market conditions, many
              industry investors and analysts have considered presentations of
              operating results for real estate companies using historical cost
              accounting alone to be insufficient. Because FFO excludes
              depreciation and amortization of real estate assets, management
              believes that FFO along with the required GAAP presentations
              provides a more complete measurement of the company's performance
              relative to its competitors and a more appropriate basis on which to
              make decisions involving operating, financing and investing
              activities than the required GAAP presentations alone would provide.
              However, FFO should not be viewed as an alternative measure of the
              company's operating performance since it does not reflect either
              depreciation and amortization costs or the level of capital
              expenditures and leasing costs necessary to maintain the operating
              performance of the company's properties, which are significant
              economic costs and could materially impact the company's results
              from operations.
        (2)   Reported amounts are attributable to common stockholders and common
              unitholders.

SOURCE: Kilroy Realty Corporation

        Kilroy Realty Corporation
        Tyler H. Rose
        Executive Vice President
        and Chief Financial Officer
        (310) 481-8484
        or
        Michelle Ngo
        Vice President
        and Treasurer
        (310) 481-8581

Copyright Business Wire 2012

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Article source: http://www.marketwatch.com/story/kilroy-realty-corporation-reports-second-quarter-financial-results-2012-08-01

LOS ANGELES, Jul 26, 2012 (BUSINESS WIRE) –
Kilroy Realty Corporation


/quotes/zigman/171049/quotes/nls/krc KRC
+1.05%



continued its successful pursuit
of value-add office building opportunities in strongly growing West
Coast commercial centers, acquiring a rare development site on Brannan
Street in San Francisco’s SOMA district and a Class A office tower in
greater Seattle’s prestigious Bellevue community.

KRC said the development site transaction, which closed last week,
represents a unique opportunity to build a state-of the-art office
property amid one of downtown San Francisco’s most popular technology
and media corridors at a total investment cost notably below recent
prices paid by other purchasers for similar assets.

In the Seattle transaction, which closed this week, the company said it
has purchased a premium quality, multi-tenant office tower, located in a
popular high-density submarket that is now experiencing strong demand
growth, at a price comfortably below replacement cost. KRC said it plans
to significantly enhance the property with a capital improvement and
modernization program that will support both property specific and
market-based rental rate growth.

Brannan Street Development Site Details. KRC paid
approximately $18.5 million for the 0.82-acre development site, located
at 329 Brannan Street in San Francisco’s SOMA district. The site is
zoned for approximately 5.0 FAR coverage and the company intends to
build a six-level office building designed to appeal to the area’s
growing community of technology and media companies. It is KRC’s second
ground-up development project in Northern California.

The new building will be LEED Gold certified. Its design will reflect
the dominant brick and timber character of the neighborhood, similar to
properties at 301 and 250 Brannan Street, which KRC also owns and which
are both 100% leased. The new building’s design will incorporate open
floor plates, concrete floors, large windows to capture natural light,
and multiple common areas–all features popular with the area’s creative
workforce.

KRC expects to complete entitlements for the development site by
year-end 2013 and complete the building in 2015. The company estimates
the total cost of the project, including land, will be approximately $80
million.

Seattle High-Rise Acquisition Details. KRC paid
approximately $186 million for the 417,000 square-foot, 24-story, Class
A office tower known as Skyline Tower located in Bellevue, Washington.
The purchase price includes the assumption of an in-place mortgage of
approximately $84 million. The loan bears interest at a rate of 6.37%
and matures on April 1, 2013.

Skyline Tower is a LEED Silver certified property featuring spectacular
views of the Cascade and Olympic Mountains and Mount Rainier, and sits
in close proximity to Bellevue’s affluent residential and retail
neighborhoods. The property, which is two blocks from KRC’s Key Center
office tower, is currently 92% leased to a diverse tenant base that
includes technology companies Expedia and Valve Corporation.

About Kilroy Realty Corporation. Kilroy Realty
Corporation, a member of the SP Small Cap 600 Index, is a real estate
investment trust active in premier office and industrial submarkets
along the West Coast. For over 60 years, the company has owned,
developed, acquired and managed real estate assets, consisting primarily
of Class A real estate properties in the coastal regions of Los Angeles,
Orange County, San Diego, greater Seattle and the San Francisco Bay
Area. At March 31, 2012, the company owned 11.8 million rentable square
feet of commercial office space and 3.4 million rentable square feet of
industrial space. More information is available at
http://www.kilroyrealty.com .

Forward Looking Statements. This press release contains
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended. Forward-looking statements are based
on our current expectations, beliefs and assumptions, and are not
guarantees of future performance, results or events. Forward-looking
statements are inherently subject to uncertainties, risks, changes in
circumstances, trends and factors that are difficult to predict, many of
which are outside of our control. Accordingly, actual performance,
results and events may vary materially from those indicated in
forward-looking statements, and you should not rely on forward-looking
statements as predictions of future performance, results or events.
Numerous factors could cause actual future performance, results and
events to differ materially from those indicated in forward-looking
statements, including, among others: risks associated with investment in
real estate assets, which are illiquid, and with trends in the real
estate industry; competitive market conditions; the ability to complete
potential acquisitions and dispositions on announced terms; the ability
to successfully operate acquired properties; the availability of cash
for debt service and exposure of risk of default under debt obligations;
government regulations that may affect development, redevelopment and
use of properties; and the ability to successfully complete development
and redevelopment projects on schedule and within budgeted amounts.
These factors are not exhaustive. For a discussion of additional risk
factors that could adversely affect our business and financial
performance, see the factors included under the caption “Risk Factors”
in our annual report on Form 10-K for the year ended December 31, 2011,
quarterly report on Form 10-Q for the quarter ended March 31, 2012, and
our other filings with the Securities and Exchange Commission. All
forward-looking statements are based on currently available information
and speak only as of the date on which they are made. We assumes no
obligation to update any forward-looking statement made in this press
release that becomes untrue because of subsequent events, new
information or otherwise, except to the extent it is required to do so
in connection with ongoing requirements under Federal securities laws.

SOURCE: Kilroy Realty Corporation

        Kilroy Realty Corporation
        Tyler H. Rose
        Executive Vice President
        and Chief Financial Officer
        310-481-8484
        or
        Michelle Ngo
        Vice President
        and Treasurer
        310-481-8581

Copyright Business Wire 2012

/quotes/zigman/171049/quotes/nls/krc

Add to portfolio

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Article source: http://www.marketwatch.com/story/kilroy-realty-corporation-acquires-value-add-opportunities-in-two-west-coast-tech-and-media-centers-2012-07-26

LOS ANGELES, Jun 04, 2012 (BUSINESS WIRE) –
Kilroy Realty Corporation


/quotes/zigman/171049/quotes/nls/krc KRC
-0.09%



today announced that it has
completed the purchase of two office properties in the Lake Union
submarket of Seattle and expects to complete the acquisition of a
Bellevue property in the third quarter, subject to customary closing
conditions. These acquisitions will nearly double the West Coast real
estate investment trust’s office portfolio in high growth submarkets of
the Puget Sound Region.

In three separate transactions, KRC has acquired or expects to acquire
properties in Lake Union and Bellevue aggregating approximately 837,000
square feet of space for a total purchase price of approximately $330
million.

Since its reentry into the Seattle market in 2010, including these
transactions, KRC will acquire approximately 1.7 million square feet of
premier office space in the Puget Sound Region and has established a
locally-based operating platform with seasoned management to expand and
manage its portfolio there. The company’s Seattle portfolio, located in
the Eastside markets of Bellevue, Kirkland and Redmond as well as the
Lake Union submarket, now represent approximately 10% of KRC’s portfolio
on a square-foot basis and account for approximately 13% of its annual
net operating income on a pro forma basis.

“Seattle’s Bellevue, Eastside and Lake Union submarkets present a
compelling set of characteristics that KRC looks for in its real estate
portfolio,” said John Kilroy, Jr., the company’s president and chief
executive officer. “These include an economically vibrant core, a unique
coastal location, a quality of life valued by fast-growing,
knowledge-based businesses and their employees, and a regional approach
to development that effectively limits supply.”

“With a knowledgeable and experienced management team now in place,”
said Kilroy, “Seattle will continue to play an important role in the
expansion of our West Coast real estate franchise and the growth of our
brand as the region’s most innovative landlord.”

Lake Union Acquisitions

In two separate transactions, KRC acquired a three-building, 420,000
square-foot office campus located at 701, 801, 837 N. 34th Street in
Seattle’s Fremont neighborhood of Lake Union for approximately $145
million. Lake Union, home to Amazon.com’s two million square-foot
headquarters, is a magnet for Seattle’s high-growth, high-tech industry
and KRC’s newly acquired campus is well positioned in the submarket on
the Lake Union waterfront and immediately adjacent to the Burke Gilman
Trail, Seattle’s most popular running and biking trail.

Known as Fremont Lake Union Center and Fremont Lake View, the
three-building campus is currently 100% leased to a tenant list that
includes Adobe, Inc., Tableau Software and Ubermind, a Deloitte software
company. KRC purchased the properties at a significant discount to
replacement cost and expects to capture significant value as this
submarket continues to lead the region in growth and tenant demand with
in-place rents well below market. The campus is subject to a long term
ground lease and the company will be assuming approximately $34 million
of debt as part of the acquisition.

Bellevue Acquisition

KRC is also in escrow to acquire Skyline Tower, a 417,000 square-foot,
24-story, Class A office building in Downtown Bellevue for approximately
$186 million. The LEED Silver certified property is located at 10900
Northeast Fourth Street, two blocks from the company’s Key Center office
building and one block north of the Bellevue Transit Center. The
building, which has spectacular views of the Cascade Mountains and Mount
Rainier, is in close proximity to The Bravern and Bellevue Square, two
of the area’s most prestigious residential and retail centers.

Skyline Tower is currently 92% leased to a diverse tenant base that
includes technology companies Expedia and Valve Corporation. The company
will assume an in-place loan of approximately $84 million as part of the
acquisition.

“With the purchase of Skyline Tower, KRC will own two of the top Class A
multi-tenant office buildings in Downtown Bellevue,” said Mike Shields,
senior vice president of KRC’s Pacific Northwest region. “We expect
Downtown Bellevue to continue to be a location of choice for both
technology and service companies that value high quality amenities,
proximity to mass transit, and commuter convenience.”

This press release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended.
Forward-looking statements are based on our current expectations,
beliefs and assumptions, and are not guarantees of future performance,
results or events. Forward-looking statements are inherently subject to
uncertainties, risks, changes in circumstances, trends and factors that
are difficult to predict, many of which are outside of our control.
Accordingly, actual performance, results and events may vary materially
from those indicated in forward-looking statements, and you should not
rely on forward-looking statements as predictions of future performance,
results or events. Numerous factors could cause actual future
performance, results and events to differ materially from those
indicated in forward-looking statements, including, among others: risks
associated with investment in real estate assets, which are illiquid,
and with trends in the real estate industry; competitive market
conditions; the ability to complete potential acquisitions and
dispositions on announced terms; the ability to successfully operate
acquired properties; the availability of cash for debt service and
exposure of risk of default under debt obligations; and the ability to
successfully complete development and redevelopment projects on schedule
and within budgeted amounts. These factors are not exhaustive. For a
discussion of additional risk factors that could adversely affect our
business and financial performance, see the factors included under the
caption “Risk Factors” in our annual report on Form 10-K for the year
ended December 31, 2011, quarterly report on Form 10-Q for the quarter
ended March 31, 2012, and our other filings with the Securities and
Exchange Commission. All forward-looking statements are based on
currently available information and speak only as of the date on which
they are made. We assumes no obligation to update any forward-looking
statement made in this press release that becomes untrue because of
subsequent events, new information or otherwise, except to the extent it
is required to do so in connection with ongoing requirements under
Federal securities laws.

Kilroy Realty Corporation, a member of the SP Small Cap 600 Index, is a
real estate investment trust active in premier office and industrial
submarkets along the West Coast. For over 60 years, the company has
owned, developed, acquired and managed real estate assets, consisting
primarily of Class A real estate properties in the coastal regions of
Los Angeles, Orange County, San Diego, greater Seattle and the San
Francisco Bay Area. At March 31, 2012, the company owned 11.8 million
rentable square feet of commercial office space and 3.4 million rentable
square feet of industrial space. More information is available at
http://www.kilroyrealty.com .

SOURCE: Kilroy Realty Corporation

        Kilroy Realty Corporation
        Tyler H. Rose
        Executive Vice President
        and Chief Financial Officer
        (310) 481-8484
        or
        Michelle Ngo
        Vice President
        and Treasurer
        (310) 481-8581

Copyright Business Wire 2012

/quotes/zigman/171049/quotes/nls/krc

Add to portfolio

KRC

Article source: http://www.marketwatch.com/story/kilroy-realty-corporation-continues-seattle-area-expansion-with-acquisitions-in-lake-union-and-bellevue-2012-06-04

LOS ANGELES, May 09, 2012 (BUSINESS WIRE) –
Kilroy Realty Corporation


/quotes/zigman/171049/quotes/nls/krc KRC
+0.54%



today announced the purchase of
690 E. Middlefield Road in Mountain View, California, where it will
develop, own and manage a 341,000 square-foot office campus under a
15-year lease for Synopsys, Inc.


/quotes/zigman/78740/quotes/nls/snps SNPS
-0.65%



, the global leader in
electronic design automation.

The Synopsys office campus represents KRC’s first ground-up development
project in the greater San Francisco Bay Area and will have a projected
total investment of approximately $200 million. The fully entitled
office project includes two five-story Class A office buildings with
state-of-the-art infrastructure and amenities, designed and
pre-registered to meet LEED Gold certification requirements.

The project is situated in one of the most attractive submarkets in
Silicon Valley, nearby such tech giants as Google Inc., Intuit, Inc. and
Symantec Corporation. In addition, the property is adjacent to
transportation infrastructure with direct, convenient access to both
Light Rail and Caltrain and immediately adjacent to Highway 237.

“This build to suit opportunity with a top technology enterprise,
located in the heart of Silicon Valley, highlights the success of KRC’s
expanding organizational capabilities in high-value West Coast real
estate markets from Seattle to San Diego,” said John Kilroy, Jr., the
company’s president and chief executive officer.

“We’re now actively leveraging the market knowledge and resources of our
enlarged management team and operating platform to extend KRC’s
traditional development expertise into new West Coast submarkets. In
doing so, we are expanding our opportunities to add properties to our
portfolio at investment returns that can be significantly above those
achievable solely through acquisition.”

KRC has been an active developer of commercial real estate for most of
its 60 plus year history, preferring the heightened control over
location, design and amenities, and the potentially higher long term
returns that developing new properties can provide under the right
market conditions.

Historically, KRC has focused its development in economically dynamic
West Coast submarkets with clear long-term demand, habitually limited
supply, and high barriers to entry. Much of the company’s current
development pipeline is focused on coastal San Diego, where, over the
last decade, KRC has established market-leading positions in the
region’s principal coastal submarkets from Del Mar and Sorrento Mesa
east to the I-15 Corridor.

With the completion of the Synopsys office campus, expected in the first
quarter of 2015, KRC’s Bay Area commercial real estate portfolio will
total approximately 3.0 million square feet from Silicon Valley to Marin
County, with 2.1 million square feet centered in San Francisco’s vibrant
South of Market (SOMA) district.

This press release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended.
Forward-looking statements are based on KRC’s current expectations,
beliefs and assumptions, and are not guarantees of future performance,
results or events. Forward-looking statements are inherently subject to
uncertainties, risks, changes in circumstances, trends and factors that
are difficult to predict, many of which are outside of KRC’s control.
Accordingly, actual performance, results and events may vary materially
from those indicated in forward-looking statements, and you should not
rely on forward-looking statements as predictions of future performance,
results or events. Numerous factors could cause actual future
performance, results and events to differ materially from those
indicated in forward-looking statements, including, among others: the
ability to successfully complete development and redevelopment projects
on schedule and within budgeted amounts; risks associated with
investment in real estate assets, which are illiquid, and with trends in
the real estate industry; environmental risks; loss of key personnel;
government regulations; general economic conditions; and the
availability of cash for debt service and exposure of risk of default
under debt obligations. These factors are not exhaustive. For a
discussion of additional risk factors that could adversely affect KRC’s
business and financial performance, see the factors included under the
caption “Risk Factors” in KRC’s annual report on Form 10-K for the year
ended December 31, 2011, quarterly report on Form 10-Q for the quarter
ended March 31, 2012, and KRC’s other filings with the Securities and
Exchange Commission. All forward-looking statements are based on
currently available information and speak only as of the date on which
they are made. KRC assumes no obligation to update any forward-looking
statement made in this press release that becomes untrue because of
subsequent events, new information or otherwise, except to the extent it
is required to do so in connection with its ongoing requirements under
Federal securities laws.

Kilroy Realty Corporation, a member of the SP Small Cap 600 Index, is a
real estate investment trust active in premier office and industrial
submarkets along the West Coast. For over 60 years, the company has
owned, developed, acquired and managed real estate assets, consisting
primarily of Class A real estate properties in the coastal regions of
Los Angeles, Orange County, San Diego, greater Seattle and the San
Francisco Bay Area. At March 31, 2012, the company owned 11.8 million
rentable square feet of commercial office space and 3.4 million rentable
square feet of industrial space. More information is available at
http://www.kilroyrealty.com .

SOURCE: Kilroy Realty Corporation

        Kilroy Realty Corporation
        Tyler H. Rose, 310-481-8484
        Executive Vice President and Chief Financial Officer
        or
        Michelle Ngo, 310-481-8581
        Vice President and Treasurer

Copyright Business Wire 2012

/quotes/zigman/171049/quotes/nls/krc

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/quotes/zigman/78740/quotes/nls/snps

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Article source: http://www.marketwatch.com/story/kilroy-realty-corporation-closes-purchase-of-silicon-valley-property-to-be-developed-for-synopsys-inc-2012-05-09