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Kilroy Realty Corporation Reports First Quarter Financial ResultsApril 27, 2026 4:05 PM
Business Wire
Kilroy Realty Corporation (NYSE: KRC) (“Kilroy” or the “Company”) today reported financial results for the first quarter ended March 31, 2026.
“I am pleased to report on a remarkably strong quarter of execution across all facets of our business. First-quarter leasing activity, which totaled 568,000 square feet, represented the Company’s strongest first-quarter performance since 2017, as we continued to capitalize on accelerating momentum across the West Coast,” said Angela Aman, Chief Executive Officer. “In addition, we remained active on the capital allocation front, selling approximately $350 million of non-core and non-strategic properties year-to-date, while prudently allocating capital to debt repayments, opportunistic share repurchases, and a substantially pre-leased development project in one of the Company’s best-performing submarkets.”
Financial Results
Revenues of $270.1 million for the quarter ended March 31, 2026, as compared to $270.8 million for the quarter ended March 31, 2025
Net loss available to common stockholders of $(19.3) million, or $(0.16) per diluted share, for the quarter ended March 31, 2026, as compared to Net income available to common stockholders of $39.0 million, or $0.33 per diluted share, for the quarter ended March 31, 2025
Funds from operations (“FFO”) of $108.8 million, or $0.91 per diluted share, for the quarter ended March 31, 2026, as compared to $122.3 million, or $1.02 per diluted share, for the quarter ended March 31, 2025
Leasing and Occupancy
Stabilized Portfolio was 77.6% occupied and 82.3% leased at March 31, 2026, representing 470 basis points of leases signed but not yet commenced
Excluding Kilroy Oyster Point Phase 2 (“KOP 2”), the Stabilized Portfolio was 81.5% occupied and 84.3% leased at March 31, 2026, representing 280 basis points of leases signed but not yet commenced
During the quarter, signed approximately 568,000 square feet of leases
Leasing activity was comprised of 406,000 square feet of new leasing on previously vacant space, 80,000 square feet of new leasing on currently occupied space, and 82,000 square feet of renewal leasing
New leasing on vacant space included an approximately 145,000-square-foot development lease with Cooley LLP, a global law firm. See “Joint Venture Formation” section below for additional details
Leasing activity during the quarter included approximately 70,000 square feet of short-term leasing
GAAP and cash rents on leases signed during the quarter decreased (10.6)% and (16.8)%, respectively, from prior levels on Second Generation leasing, excluding short-term leasing
Excluding leases signed on space vacant for more than 12 months, GAAP and cash rents on leases signed during the quarter increased 19.2% and 5.2%, respectively
Capital Recycling Activity
In January, completed the sale of Kilroy Sabre Springs, an approximately 428,000-square-foot, three-building campus in the I-15 Corridor submarket of San Diego, for gross sales proceeds of $124.5 million
In March, completed the sale of Del Mar Tech Center, an approximately 39,000-square-foot office property in the Del Mar submarket of San Diego, for gross sales proceeds of $21.0 million
During the first quarter, entered into an agreement to sell the 200-unit Columbia Square Living residential tower and the 193-unit Jardine residential tower in the Hollywood submarket of Los Angeles and classified the properties as Held for Sale. The sale closed in April for gross sales proceeds of $202.0 million
Common Stock Repurchases
During the quarter, repurchased approximately 2.4 million shares of common stock at a weighted average price of $30.80 per common share for an aggregate purchase price of $72.7 million
Joint Venture Formation
In February, acquired an interest in 1900 Broadway, a fully-entitled land site in Downtown Redwood City capable of supporting a 251,000-square-foot office building. Concurrent with closing, signed a 20-year lease with Cooley LLP for 145,000 square feet, bringing the project to 58% pre-leased. Total project costs are expected to range from $330.0 million to $350.0 million. Construction is anticipated to commence in 2027, with delivery scheduled for 2030, at which time the Company’s ownership interest is expected to be 97%
Dividend
The Board declared and paid a regular quarterly cash dividend on its common stock of $0.54 per share, equivalent to an annual rate of $2.16 per share. The dividend was paid on April 8, 2026 to stockholders of record on March 31, 2026 (the ex-dividend date)
Recent Developments
In April, repaid the outstanding $50.0 million of 4.300% Private Placement Senior Notes Series A due July 2026, at par
Net Income Available to Common Stockholders / FFO Guidance
The Company is updating Nareit-defined FFO per share guidance for the full year 2026 to $3.49 to $3.63 per diluted share, from the previous range of $3.25 to $3.45. The table below reflects key assumptions for 2026 guidance.
Key Assumptions
February 2026 Assumptions
April 2026 Assumptions
Average full year occupancy
76.0% to 78.0%
76.5% to 78.0%
Average full year occupancy excluding KOP 2
80.0% to 81.5%
80.5% to 81.5%
Same Property Cash Net Operating Income (“NOI”) growth (1) (2)
(1.50%) to 0.00%
0.25% to 1.25%
NOI from Development Properties (3)
$(23.5) to $(25.0) million
$(22.5) to $(24.0) million
Non-Cash GAAP NOI adjustments (1) (4)
$12.0 to $14.0 million
$13.0 to $15.0 million
GAAP lease termination fee income
$3.0 to $4.5 million
No change
General and administrative and Leasing costs
$(89.0) to $(91.0) million
$(87.5) to $(89.5) million
Interest income
$2.0 to $3.0 million
No change
Gross interest expense
$(212.0) to $(214.0) million
$(208.0) to $(209.5) million
Capitalized interest (5)
$32.0 to $34.0 million
$48.5 to $49.5 million
Total development spending (6)
$150.0 to $200.0 million
No change
Operating property dispositions
+/- $300.0 million
$347.5 to $500.0 million
Full Year 2026 Range
as of February 2026
Full Year 2026 Range
as of April 2026
Low End
High End
Low End
High End
$ and shares/units in thousands, except per share/unit amounts
Net income available to common stockholders per share - diluted
$
0.59
$
0.79
$
0.08
$
0.22
Weighted average common shares outstanding - diluted (7)
120,100
120,100
118,100
118,100
Net income available to common stockholders
$
70,800
$
95,040
$
9,055
$
25,743
Adjustments:
Net income attributable to noncontrolling common units of the Operating Partnership
300
300
300
300
Net income attributable to noncontrolling interests in consolidated property partnerships
17,000
17,000
17,000
17,000
Depreciation and amortization of real estate assets
342,000
342,000
379,400
379,400
Gain on sale of depreciable operating property
(8,200
)
(8,200
)
(23,525
)
(23,525
)
Impairment of real estate assets
—
—
61,778
61,778
Funds From Operations attributable to noncontrolling interests in consolidated property partnerships
(28,000
)
(28,000
)
(28,000
)
(28,000
)
Funds From Operations (1)
$
393,900
$
418,140
$
416,008
$
432,696
Weighted average common shares/units outstanding – diluted (8)
121,200
121,200
119,200
119,200
Nareit Funds From Operations per common share/unit – diluted (1)
$
3.25
$
3.45
$
3.49
$
3.63
(1)
For additional information, please refer to pages 36-38 “Non-GAAP Supplemental Measures” of the Company’s Supplemental Financial Report furnished on Form 8-K for management statements on the Company’s non-GAAP measures.
(2)
Increase in guidance range includes $5.9 million in settlement income received in Q2 2026.
(3)
NOI from Development Properties is primarily comprised of carry costs associated with Company’s KOP 2 and Flower Mart projects. Guidance now assumes the continued capitalization of the Company’s Flower Mart project through December 2026, previously assumed to be June 2026.
(4)
Non-Cash GAAP NOI adjustments include the following items: Amortization of deferred revenue related to tenant-funded tenant improvements, Straight-line rents, net, Amortization of net below market rents, and Lease related adjustments and other.
(5)
Capitalized interest guidance now assumes the continued capitalization of the Company’s Flower Mart project through December 2026, previously assumed to be June 2026.
(6)
Total development spending includes recently stabilized, in-process, and future development projects.
(7)
Calculated based on estimated weighted average shares outstanding, including non-participating share-based awards and the dilutive impact of contingently issuable shares.
(8)
Calculated based on the weighted average shares outstanding, including participating and non-participating share-based awards, and the dilutive impact of contingently issuable shares, and assuming the exchange of all common limited partnership units outstanding. Reported amounts are attributable to common stockholders, common unitholders, and restricted stock unitholders.
The Company’s guidance estimates for the full year 2026, and the reconciliation of Net income available to common stockholders per share - diluted and FFO per share and unit - diluted included within this press release, reflect management’s views on current and future market conditions, including assumptions with respect to rental rates, occupancy levels, and the earnings impact of the events referenced in this press release. These guidance estimates do not include the impact on the Company’s operating results from any events outside of the Company’s control, as the timing and magnitude of any such events are not known at the time the Company provides guidance. There can be no assurance that the Company’s actual results will not differ materially from these estimates.
Conference Call and Audio Webcast
The Company’s management will discuss first quarter results and the current business environment during the Company’s April 28, 2026 earnings conference call. The call will begin at 10:00 a.m. Pacific Time and last approximately one hour. To participate and obtain conference call dial-in details, register by using the following link, https://events.q4inc.com/analyst/264481752?pwd=Vl5fneFS. Those interested in listening via the Internet can access the conference call at https://events.q4inc.com/attendee/264481752. It may be necessary to download audio software to hear the conference call.
About Kilroy Realty Corporation
Kilroy is a leading U.S. landlord and developer, with operations in the San Francisco Bay Area, Los Angeles, Seattle, San Diego, and Austin. The Company has earned global recognition for sustainability, building operations, innovation, and design. As a pioneer and innovator in the creation of a more sustainable real estate industry, the Company’s approach to modern business environments helps drive creativity and productivity for some of the world’s leading technology, media, life science, and professional services companies.
The Company is a publicly traded real estate investment trust (“REIT”) and member of the S&P MidCap 400 Index with more than seven decades of experience managing, developing, and acquiring office, life science, and mixed-use projects.
As of March 31, 2026, Kilroy’s stabilized portfolio totaled approximately 17.1 million square feet of primarily office and life science space that was 77.6% occupied and 82.3% leased. The Company also has 608 residential units in San Diego, with a quarterly average occupancy of 95.0%.
A Leader in Sustainability and Commitment to Corporate Social Responsibility
Kilroy has a longstanding commitment to sustainability and continues to be a recognized leader in our sector. For over a decade, the Company and its sustainability initiatives have been recognized with numerous honors, including earning the GRESB five star rating and being named a sector and regional leader in the Americas. Other honors have included the Nareit Leader in the Light Award, being listed on the Dow Jones Sustainability World Index, being named ENERGY STAR Partner of the Year, and receiving the ENERGY STAR highest honor of Sustained Excellence.
Kilroy is proud to have achieved carbon neutral operations across our portfolio since 2020. The Company also has a longstanding commitment to maintain high levels of LEED, Fitwell, and ENERGY STAR certifications across the portfolio.
Kilroy is committed to cultivating a company culture that makes a positive difference in our employees’ lives by focusing on development, celebrating our unique backgrounds, promoting employee health and wellness, and dedicating ourselves to being a responsible corporate citizen through our community service and philanthropic efforts.
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. 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 or implied in the forward-looking statements, and you should not rely on the 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 the forward-looking statements, including, among others: global market and general economic conditions, including actual and potential tariffs and periods of heightened inflation, and their effect on us and our tenants; adverse economic or real estate conditions generally, and specifically, in the States of California, Texas, and Washington; risks associated with our investment in real estate assets, which are illiquid, and with trends in the real estate industry; defaults on or non-renewal of leases by tenants; any significant downturn in tenants’ businesses, including bankruptcy, lack of liquidity or lack of funding, and the impact labor disruptions or strikes, such as episodic strikes in the media industry, may have on our tenants’ businesses; our ability to re-lease property at or above current market rates; reduced demand for office space, including as a result of remote working and flexible working arrangements that allow work from remote locations other than an employer's office premises; costs to comply with government regulations, including environmental remediation; the availability of cash for distribution and debt service, and exposure to risk of default under debt obligations; increases in interest rates and our ability to manage interest rate exposure; changes in interest rates and the availability of financing on attractive terms or at all, which may adversely impact our future interest expense and our ability to pursue development, redevelopment, and acquisition opportunities and refinance existing debt; a decline in real estate asset valuations, which may limit our ability to dispose of assets at attractive prices, or obtain or maintain debt financing, and which may result in write-offs or impairment charges; significant competition, which may decrease the occupancy and rental rates of properties; potential losses that may not be covered by insurance; the ability to successfully complete acquisitions and dispositions on announced terms; the ability to successfully operate acquired, developed, and redeveloped properties; the ability to successfully complete development and redevelopment projects on schedule and within budgeted amounts; delays or refusals in obtaining all necessary zoning, land use, and other required entitlements, governmental permits and authorizations for our development and redevelopment properties; increases in anticipated capital expenditures, tenant improvement, and/or leasing costs; defaults on leases for land on which some of our properties are located; adverse changes to, or enactment or implementations of, tax laws or other applicable laws, regulations, or legislation, as well as business and consumer reactions to such changes; risks associated with joint venture investments, including our lack of sole decision-making authority, our reliance on co-venturers’ financial condition, and disputes between us and our co-venturers; environmental uncertainties and risks related to natural disasters; risks associated with climate change and our sustainability strategies, and our ability to achieve our sustainability goals; and our ability to maintain our status as a REIT. These factors are not exhaustive and additional factors could adversely affect our business and financial performance. 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, 2025, 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 dates 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 we are required to do so in connection with our ongoing requirements under federal securities laws.
KILROY REALTY CORPORATION
SUMMARY OF QUARTERLY RESULTS
(unaudited; in thousands, except per share data)
Three Months Ended March 31,
2026
2025
Revenues
$
270,053
$
270,844
Net (loss) income available to common stockholders
$
(19,267
)
$
39,008
Weighted average common shares outstanding – basic
117,637
118,195
Weighted average common shares outstanding – diluted
117,637
118,664
Net (loss) income available to common stockholders per share – basic
$
(0.16
)
$
0.33
Net (loss) income available to common stockholders per share – diluted
$
(0.16
)
$
0.33
Funds From Operations (1)(2)
$
108,846
$
122,310
Weighted average common shares/units outstanding – basic (3)
119,251
119,750
Weighted average common shares/units outstanding – diluted (4)
119,957
120,220
Funds From Operations per common share/unit – basic (2)
$
0.91
$
1.02
Funds From Operations per common share/unit – diluted (2)
$
0.91
$
1.02
Common shares outstanding at end of period
116,279
118,269
Common partnership units outstanding at end of period
1,134
1,151
Total common shares and units outstanding at end of period
117,413
119,420
March 31, 2026
March 31, 2025
Stabilized office portfolio occupancy rates: (5)
San Francisco Bay Area
75.2
%
86.8
%
Los Angeles
74.8
%
72.7
%
Seattle
79.3
%
78.6
%
San Diego
84.6
%
87.5
%
Austin
83.2
%
76.4
%
Weighted average total
77.6
%
81.4
%
Total square feet of stabilized office properties owned at end of period: (5)
San Francisco Bay Area
6,437
6,171
Los Angeles
4,242
4,340
Seattle
2,997
2,996
San Diego
2,689
2,870
Austin
759
759
Total
17,124
17,136
(1)
Reconciliation of Net (loss) income available to common stockholders to Funds From Operations available to common stockholders and unitholders and management statement on Funds From Operations are included after the Consolidated Statements of Operations.
(2)
Reported amounts are attributable to common stockholders, common unitholders and restricted stock unitholders.
(3)
Calculated based on weighted average shares outstanding, including participating share-based awards (i.e., certain time-based restricted stock units) and assuming the exchange of all common limited partnership units outstanding.
(4)
Calculated based on weighted average shares outstanding, including participating and non-participating share-based awards, dilutive impact of contingently issuable shares, and assuming the exchange of all common limited partnership units outstanding.
(5)
Occupancy percentages and total square feet reported are based on the Company’s stabilized office portfolio for the periods presented.
KILROY REALTY CORPORATION
CONSOLIDATED BALANCE SHEETS
(unaudited; in thousands)
March 31, 2026
December 31, 2025
ASSETS
Real Estate Assets
Land
$
1,730,514
$
1,641,913
Buildings and improvements
9,011,023
8,505,486
Undeveloped land and construction in progress
1,585,042
2,387,742
Total real estate assets held for investment
12,326,579
12,535,141
Accumulated depreciation and amortization
(2,857,265
)
(2,843,811
)
Total real estate assets held for investment, net
9,469,314
9,691,330
Real estate and other assets held for sale, net
188,771
115,155
Cash and cash equivalents
192,904
179,316
Marketable securities
31,417
30,807
Current receivables, net
15,712
12,765
Deferred rent receivables, net
425,420
424,794
Deferred leasing costs and acquisition-related intangible assets, net
271,213
278,232
Right of use ground lease assets, net
127,834
128,116
Prepaid expenses and other assets, net
52,273
54,561
TOTAL ASSETS
$
10,774,858
$
10,915,076
LIABILITIES AND EQUITY
Liabilities:
Secured debt, net
$
591,398
$
592,685
Unsecured debt, net
3,997,993
3,996,774
Accounts payable, accrued expenses, and other liabilities
303,808
288,963
Ground lease liabilities
127,414
127,628
Accrued dividends and distributions
63,421
65,009
Deferred revenue and acquisition-related intangible liabilities, net
122,272
125,628
Rents received in advance and tenant security deposits
79,638
75,701
Liabilities related to real estate assets held for sale
—
4,945
Total liabilities
5,285,944
5,277,333
Equity:
Stockholders’ Equity
Common stock
1,163
1,184
Additional paid-in capital
5,161,140
5,230,747
Retained earnings
102,859
188,876
Total stockholders’ equity
5,265,162
5,420,807
Noncontrolling Interests
Common units of the Operating Partnership
51,328
51,911
Consolidated property partnerships
172,424
165,025
Total noncontrolling interests
223,752
216,936
Total equity
5,488,914
5,637,743
TOTAL LIABILITIES AND EQUITY
$
10,774,858
$
10,915,076
KILROY REALTY CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited; in thousands, except per share data)
Three Months Ended March 31,
2026
2025
Revenues
Rental income
$
265,330
$
266,244
Other property income
4,723
4,600
Total revenues
270,053
270,844
Expenses
Property expenses
59,283
58,714
Real estate taxes
28,782
28,365
Ground leases
3,187
3,020
General and administrative expenses
20,699
16,901
Leasing costs
3,010
2,873
Depreciation and amortization
94,344
87,119
Total expenses
209,305
196,992
Other Income (Expenses)
Interest income
954
1,134
Interest expense
(38,511
)
(31,148
)
Other income (expense)
389
(157
)
Gains on sales of depreciable operating properties
23,525
—
Impairment of real estate assets
(61,778
)
—
Total other expenses
(75,421
)
(30,171
)
Net (loss) income
(14,673
)
43,681
Net loss (income) attributable to noncontrolling common units of the Operating Partnership
185
(375
)
Net income attributable to noncontrolling interests in consolidated property partnerships
(4,779
)
(4,298
)
Total net income attributable to noncontrolling interests
(4,594
)
(4,673
)
Net (loss) income available to common stockholders
$
(19,267
)
$
39,008
Weighted average shares of common stock outstanding – basic
117,637
118,195
Weighted average shares of common stock outstanding – diluted
117,637
118,664
Net (loss) income available to common stockholders per share – basic
$
(0.16
)
$
0.33
Net (loss) income available to common stockholders per share – diluted
$
(0.16
)
$
0.33
KILROY REALTY CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited; in thousands, except per share data)
Three Months Ended March 31,
2026
2025
Cash flows from operating activities:
Net (loss) income
$
(14,673
)
$
43,681
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation and amortization of real estate assets and leasing costs
92,885
85,735
Depreciation of non-real estate furniture, fixtures, and equipment
1,459
1,384
Revenues deemed uncollectible
358
621
Non-cash amortization of deferred revenue related to tenant-funded tenant improvements
(3,218
)
(3,688
)
Straight-line rents, net
(701
)
4,613
Non-cash amortization of net below-market rents
(641
)
(846
)
Non-cash amortization of deferred financing costs and debt discounts
1,662
1,219
Non-cash amortization of share-based compensation awards
4,869
3,927
Amortization of right of use ground lease assets
282
273
Gains on sales of depreciable operating properties
(23,525
)
—
Impairment of real estate assets
61,778
—
Net change in other operating assets
131
(21,886
)
Net change in other operating liabilities
30,029
21,888
Net cash provided by operating activities
150,695
136,921
Cash flows from investing activities:
Expenditures for development and redevelopment properties and undeveloped land
(102,647
)
(55,347
)
Expenditures for operating properties and other capital assets
(29,945
)
(21,313
)
Net proceeds received from dispositions of real estate assets
141,440
—
Non-refundable deposits received for future dispositions
6,200
—
Net cash provided by (used in) investing activities
15,048
(76,660
)
Cash flows from financing activities:
Distributions to noncontrolling interests in consolidated property partnerships
(6,380
)
(7,226
)
Dividends and distributions paid to common stockholders and common unitholders
(64,534
)
(64,366
)
Taxes paid upon net share settlement of restricted share units
(6,970
)
(6,009
)
Principal payments and repayments of secured debt
(1,600
)
(1,539
)
Repurchase of common stock
(72,671
)
—
Financing costs
—
(100
)
Net cash used in financing activities
(152,155
)
(79,240
)
Net increase (decrease) in cash and cash equivalents
13,588
(18,979
)
Cash and cash equivalents, beginning of period
179,316
165,690
Cash and cash equivalents, end of period
$
192,904
$
146,711
KILROY REALTY CORPORATION
FUNDS FROM OPERATIONS
(unaudited; in thousands, except per share data)
Three Months Ended March 31,
2026
2025
Net (loss) income available to common stockholders
$
(19,267
)
$
39,008
Adjustments:
Net loss (income) attributable to noncontrolling common units of the Operating Partnership
(185
)
375
Net income attributable to noncontrolling interests in consolidated property partnerships
4,779
4,298
Depreciation and amortization of real estate assets
92,885
85,735
Gains on sales of depreciable operating properties
(23,525
)
—
Impairment of real estate assets
61,778
—
Funds From Operations attributable to noncontrolling interests in consolidated property partnerships
(7,619
)
(7,106
)
Funds From Operations (1)(2)(3)
$
108,846
$
122,310
Weighted average common shares/units outstanding – basic (4)
119,251
119,750
Weighted average common shares/units outstanding – diluted (5)
119,957
120,220
Funds From Operations per common share/unit – basic (2)
$
0.91
$
1.02
Funds From Operations per common share/unit – diluted (2)
$
0.91
$
1.02
(1)
The Company calculates Funds From Operations available to common stockholders and common unitholders (“FFO”) in accordance with the 2018 Restated 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 depreciation and amortization related to real estate, gains and losses from the sale of certain real estate assets, gains and losses from change in control, and impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity. The reconciling items include amounts to adjust earnings from consolidated partially-owned entities and equity in earnings of unconsolidated affiliates to FFO. Our calculation of FFO includes the amortization of deferred revenue related to tenant-funded tenant improvements and excludes the depreciation of the related tenant improvement assets. We also add back net income attributable to noncontrolling common units of the Operating Partnership because we report FFO attributable to common stockholders and common unitholders.
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 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.
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, common unitholders, and restricted stock unitholders.
(3)
FFO available to common stockholders and unitholders includes amortization of deferred revenue related to tenant-funded tenant improvements of $3.2 million and $3.7 million for the three months ended March 31, 2026 and 2025, respectively.
(4)
Calculated based on weighted average shares outstanding, including participating share-based awards (i.e., certain time-based restricted stock units) and assuming the exchange of all common limited partnership units outstanding.
(5)
Calculated based on weighted average shares outstanding, including participating and non-participating share-based awards, dilutive impact of contingently issuable shares, and assuming the exchange of all common limited partnership units outstanding.
View source version on businesswire.com: https://www.businesswire.com/news/home/20260427092075/en/
Doug Bettisworth
Vice President, Corporate Finance
(310) 481-8585
Original: Kilroy Realty Corporation Reports First Quarter Financial Results
US Market News
2月前
Kilroy Realty Publishes Fifteenth Annual Sustainability ReportApril 9, 2026 4:05 PM
Business Wire
Kilroy Realty Corporation (NYSE: KRC) ("Kilroy" or the “Company”) published its fifteenth annual Sustainability Report today, providing updates on progress toward our 2030 Environmental and Social Goals, and building on the Company’s longstanding track record of sustainability leadership.
Kilroy’s 2025 Sustainability Report details the Company’s sustainability strategy, goals, performance, and impact across a wide range of environmental, social, and governance initiatives.
“Sustainability is an integral part of our business strategy and company culture,” said Angela Aman, Chief Executive Officer. “Our approach creates long-term value and fosters meaningful engagement with our employees, our existing and prospective tenants, the communities we serve, and our shareholders.”
Recent achievements announced in the 2025 Sustainability Report include:
Maintained carbon neutral operations for the sixth consecutive year
Earned a five-star designation in the 2025 GRESB Real Estate Assessment for our Standing Assets and named the Regional Sector Leader in the Americas in Technology / Life Science for our Development Portfolio
Received a 2026 Nareit Leader in the Light Award for Responsibility
Named a 2026 Fitwel Best in Building Health Impact Award winner for Greatest Number of Recertified Projects of All-Time
“Collaboration across Kilroy, as well as with our tenants and partners, has been central to our sustainability success this year,” said Sarah King, Senior Vice President, Sustainability. “Whether advancing energy efficiency projects, expanding onsite solar, sharpening our philanthropic focus, or investing in employee development, our shared commitment to environmental and social progress continues to drive meaningful results.”
The full report can be found on the Kilroy website at: https://kilroyrealty.com/sustainability/
About Kilroy Realty Corporation
Kilroy is a leading U.S. landlord and developer, with operations in the San Francisco Bay Area, Los Angeles, Seattle, San Diego, and Austin. The Company has earned global recognition for sustainability, building operations, innovation, and design. As a pioneer and innovator in the creation of a more sustainable real estate industry, the Company’s approach to modern business environments helps drive creativity and productivity for some of the world’s leading technology, media, life science, and business services companies.
The Company is a publicly traded real estate investment trust (“REIT”) and member of the S&P MidCap 400 Index with more than seven decades of experience developing, acquiring, and managing office, life science, and mixed-use projects.
As of December 31, 2025, Kilroy’s stabilized portfolio totaled approximately 16.3 million square feet of primarily office and life science space that was 81.6% occupied and 83.8% leased. The Company also had approximately 1,000 residential units in Hollywood and San Diego, which had a quarterly average occupancy of 94.1%. In addition, the Company had one development project in the tenant improvement phase totaling approximately 872,000 square feet with a total estimated investment of $1.2 billion.
A Leader in Sustainability and Commitment to Corporate Social Responsibility
Kilroy has a longstanding commitment to sustainability and continues to be a recognized leader in our sector. For over a decade, the Company and its sustainability initiatives have been recognized with numerous honors, including earning the GRESB five star rating and being named a sector and regional leader in the Americas. Other honors have included the Nareit Leader in the Light Award, being listed on the Dow Jones Sustainability World Index, being named ENERGY STAR Partner of the Year, and receiving the ENERGY STAR highest honor of Sustained Excellence.
Kilroy is proud to have achieved carbon neutral operations across our portfolio since 2020. The Company also has a longstanding commitment to maintain high levels of LEED, Fitwell, and ENERGY STAR certifications across the portfolio.
Kilroy is committed to cultivating a company culture that makes a positive difference in our employees’ lives by focusing on development, celebrating our unique backgrounds, promoting employee health and wellness, and dedicating ourselves to being a responsible corporate citizen through our community service and philanthropic efforts.
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. 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 or implied in the forward-looking statements, and you should not rely on the 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 the forward-looking statements, including, among others: global market and general economic conditions, including actual and potential tariffs and periods of heightened inflation, and their effect on our liquidity and financial conditions and those of our tenants; adverse economic or real estate conditions generally, and specifically, in the States of California, Texas, and Washington; risks associated with our investment in real estate assets, which are illiquid, and with trends in the real estate industry; defaults on or non-renewal of leases by tenants; any significant downturn in tenants’ businesses, including bankruptcy, lack of liquidity or lack of funding, and the impact labor disruptions or strikes, such as episodic strikes in the media industry, may have on our tenants’ businesses; our ability to re-lease property at or above current market rates; reduced demand for office space, including as a result of remote working and flexible working arrangements that allow work from remote locations other than an employer's office premises; costs to comply with government regulations, including environmental remediation; the availability of cash for distribution and debt service, and exposure to risk of default under debt obligations; increases in interest rates and our ability to manage interest rate exposure; changes in interest rates and the availability of financing on attractive terms or at all, which may adversely impact our future interest expense and our ability to pursue development, redevelopment, and acquisition opportunities and refinance existing debt; a decline in real estate asset valuations, which may limit our ability to dispose of assets at attractive prices, or obtain or maintain debt financing, and which may result in write-offs or impairment charges; significant competition, which may decrease the occupancy and rental rates of properties; potential losses that may not be covered by insurance; the ability to successfully complete acquisitions and dispositions on announced terms; the ability to successfully operate acquired, developed, and redeveloped properties; the ability to successfully complete development and redevelopment projects on schedule and within budgeted amounts; delays or refusals in obtaining all necessary zoning, land use, and other required entitlements, governmental permits and authorizations for our development and redevelopment properties; increases in anticipated capital expenditures, tenant improvement, and/or leasing costs; defaults on leases for land on which some of our properties are located; adverse changes to, or enactment or implementations of, tax laws or other applicable laws, regulations, or legislation, as well as business and consumer reactions to such changes; risks associated with joint venture investments, including our lack of sole decision-making authority, our reliance on co-venturers’ financial condition, and disputes between us and our co-venturers; environmental uncertainties and risks related to natural disasters; risks associated with climate change and our sustainability strategies, and our ability to achieve our sustainability goals; and our ability to maintain our status as a REIT. These factors are not exhaustive and additional factors could adversely affect our business and financial performance. 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, 2025, 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 dates 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 we are required to do so in connection with our ongoing requirements under federal securities laws.
View source version on businesswire.com: https://www.businesswire.com/news/home/20260406549623/en/
Doug Bettisworth
Vice President, Corporate Finance
(310) 481-8585
Original: Kilroy Realty Publishes Fifteenth Annual Sustainability Report
US Market News
2月前
Kilroy Realty Receives Recognition for Sustainability Excellence, Earning Nareit’s 2026 Leader in the Light® Award for Responsibility and Fitwel’s 2026 Best in Building Health Impact AwardApril 1, 2026 4:19 PM
Business Wire
Kilroy Realty Corporation (NYSE: KRC) (“Kilroy” or the “Company”) today announced it recently received two prestigious sustainability honors: the 2026 Leader in the Light® Award for Responsibility from Nareit, the National Association of Real Estate Investment Trusts, and the 2026 Best in Building Health Impact Award for Greatest Number of Recertified Projects of All-Time from Fitwel. Together, these recognitions reflect the Company’s longstanding commitment to responsible business practices and healthy, high-performing buildings across its portfolio.
The Leader in the Light® Awards, now in their 20th year, recognize REITs for demonstrating leadership in responsible business practices that create value and positively impact communities within their portfolios and across the REIT industry. The Responsibility category recognizes REITs that have implemented responsible business practices resulting in measurable, positive impacts on their workforce, tenants, and/or the communities they serve, as determined by an independent panel of expert judges. Kilroy was the mid-cap recipient in the Responsibility category.
The Fitwel Best in Building Health Awards are an annual recognition honoring the top global real estate companies leading the healthy building movement, leveraging the trusted Fitwel Standard to define excellence in building health. Kilroy received the Impact Award for Greatest Number of Recertified Projects of All-Time, a recognition that honors companies setting the highest benchmarks for impact, certification scale, and performance across the real estate industry.
“For more than a decade, Kilroy has made sustainability and building health core priorities— commitments that we believe strengthen our relationships with our tenants, our employees, and the communities we serve,” said Angela Aman, Chief Executive Officer of Kilroy Realty. “We are honored to have received these recognitions from both Nareit and Fitwel, as we continue to prioritize the needs of all stakeholders while driving long-term sustainable growth and value creation.”
For over a decade, Kilroy has earned consistent recognition for sustainability leadership, including the GRESB five-star rating, and ENERGY STAR's highest honor of Sustained Excellence. The Company has achieved carbon neutral operations across its portfolio since 2020 while maintaining high levels of LEED, Fitwel, and ENERGY STAR certifications. Kilroy's approach to responsibility also reflects a deep commitment to its people and communities, through employee development, health and wellness programs, and philanthropic efforts.
About Kilroy Realty Corporation
Kilroy is a leading U.S. landlord and developer, with operations in the San Francisco Bay Area, Los Angeles, Seattle, San Diego, and Austin. The Company has earned global recognition for sustainability, building operations, innovation, and design. As a pioneer and innovator in the creation of a more sustainable real estate industry, the Company’s approach to modern business environments helps drive creativity and productivity for some of the world’s leading technology, media, life science, and business services companies.
The Company is a publicly traded real estate investment trust (“REIT”) and member of the S&P MidCap 400 Index with more than seven decades of experience developing, acquiring, and managing office, life science, and mixed-use projects.
As of December 31, 2025, Kilroy’s stabilized portfolio totaled approximately 16.3 million square feet of primarily office and life science space that was 81.6% occupied and 83.8% leased. The Company also had approximately 1,000 residential units in Hollywood and San Diego, which had a quarterly average occupancy of 94.1%. In addition, the Company had one development project in the tenant improvement phase totaling approximately 872,000 square feet with a total estimated investment of $1.2 billion.
A Leader in Sustainability and Commitment to Corporate Social Responsibility
Kilroy has a longstanding commitment to sustainability and continues to be a recognized leader in our sector. For over a decade, the Company and its sustainability initiatives have been recognized with numerous honors, including earning the GRESB five star rating and being named a sector and regional leader in the Americas. Other honors have included the Nareit Leader in the Light Award, being listed on the Dow Jones Sustainability World Index, being named ENERGY STAR Partner of the Year, and receiving the ENERGY STAR highest honor of Sustained Excellence.
Kilroy is proud to have achieved carbon neutral operations across our portfolio since 2020. The Company also has a longstanding commitment to maintain high levels of LEED, Fitwell, and ENERGY STAR certifications across the portfolio.
Kilroy is committed to cultivating a company culture that makes a positive difference in our employees’ lives by focusing on development, celebrating our unique backgrounds, promoting employee health and wellness, and dedicating ourselves to being a responsible corporate citizen through our community service and philanthropic efforts.
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. 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 or implied in the forward-looking statements, and you should not rely on the 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 the forward-looking statements, including, among others: global market and general economic conditions, including actual and potential tariffs and periods of heightened inflation, and their effect on our liquidity and financial conditions and those of our tenants; adverse economic or real estate conditions generally, and specifically, in the States of California, Texas, and Washington; risks associated with our investment in real estate assets, which are illiquid, and with trends in the real estate industry; defaults on or non-renewal of leases by tenants; any significant downturn in tenants’ businesses, including bankruptcy, lack of liquidity or lack of funding, and the impact labor disruptions or strikes, such as episodic strikes in the media industry, may have on our tenants’ businesses; our ability to re-lease property at or above current market rates; reduced demand for office space, including as a result of remote working and flexible working arrangements that allow work from remote locations other than an employer's office premises; costs to comply with government regulations, including environmental remediation; the availability of cash for distribution and debt service, and exposure to risk of default under debt obligations; increases in interest rates and our ability to manage interest rate exposure; changes in interest rates and the availability of financing on attractive terms or at all, which may adversely impact our future interest expense and our ability to pursue development, redevelopment, and acquisition opportunities and refinance existing debt; a decline in real estate asset valuations, which may limit our ability to dispose of assets at attractive prices, or obtain or maintain debt financing, and which may result in write-offs or impairment charges; significant competition, which may decrease the occupancy and rental rates of properties; potential losses that may not be covered by insurance; the ability to successfully complete acquisitions and dispositions on announced terms; the ability to successfully operate acquired, developed, and redeveloped properties; the ability to successfully complete development and redevelopment projects on schedule and within budgeted amounts; delays or refusals in obtaining all necessary zoning, land use, and other required entitlements, governmental permits and authorizations for our development and redevelopment properties; increases in anticipated capital expenditures, tenant improvement, and/or leasing costs; defaults on leases for land on which some of our properties are located; adverse changes to, or enactment or implementations of, tax laws or other applicable laws, regulations, or legislation, as well as business and consumer reactions to such changes; risks associated with joint venture investments, including our lack of sole decision-making authority, our reliance on co-venturers’ financial condition, and disputes between us and our co-venturers; environmental uncertainties and risks related to natural disasters; risks associated with climate change and our sustainability strategies, and our ability to achieve our sustainability goals; and our ability to maintain our status as a REIT. These factors are not exhaustive and additional factors could adversely affect our business and financial performance. 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, 2025, 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 dates 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 we are required to do so in connection with our ongoing requirements under federal securities laws.
View source version on businesswire.com: https://www.businesswire.com/news/home/20260401366951/en/
Doug Bettisworth
Vice President, Corporate Finance
(310) 481-8585
Original: Kilroy Realty Receives Recognition for Sustainability Excellence, Earning Nareit’s 2026 Leader in the Light® Award for Responsibility and Fitwel’s 2026 Best in Building Health Impact Award
US Market News
3月前
Kilroy Realty Corporation Announces Board RefreshmentFebruary 26, 2026 9:05 AM
Business Wire
Kilroy Realty Corporation (NYSE: KRC) (“Kilroy” or the “Company”) today announced leadership changes on the Company’s Board of Directors (the “Board”) and within its committees, including the appointment of Gary Stevenson as Chair of the Board, Edward Brennan, PhD, as Chair of the Audit Committee, and Jolie Hunt as Chair of the Executive Compensation Committee. In addition, the Company announced the appointment of two new Directors, Cia Buckley Marakovits and David Kieske, to the Company’s Board. All leadership changes and new Director appointments were effective February 24, 2026.
BOARD LEADERSHIP TRANSITION
The Board has appointed Gary Stevenson as Chair of the Board, succeeding Edward Brennan, PhD, who has served on the Board since 2003 and as Chair since 2024. Mr. Stevenson has been a member of Kilroy’s Board since 2014 and brings over four decades of executive leadership experience, including as Deputy Commissioner of Major League Soccer and President of Soccer United Marketing for the past 13 years. He previously served as Chair of the Executive Compensation Committee, where he played a key role in enhancing the Company’s executive compensation philosophy and governance approach. Dr. Brennan, who has been serving as Interim Chair of the Audit Committee, has now been formally appointed as Chair of that committee. Mr. Stevenson will be succeeded by Jolie Hunt as Chair of the Executive Compensation Committee. A Board member since 2015, Ms. Hunt has served on the Executive Compensation Committee for 11 years and was appointed Chair of the Corporate Social Responsibility and Sustainability Committee in 2018. There, she played a central role in shaping the Company’s ESG oversight and stakeholder engagement strategy.
“I want to express my sincere gratitude to Ed for his exceptional leadership as Chair of the Board and his continued commitment to Kilroy,” said Angela Aman, CEO. “Ed’s steady guidance and strategic perspective have been invaluable during a period of significant transformation. At the same time, we are thrilled for Gary to step into the role of Board Chair. His deep governance experience, proven leadership, and long-standing dedication to our stakeholders position him exceptionally well to lead the Board through the next phase of the Company’s growth and evolution.”
NEW DIRECTOR APPOINTMENTS
The Company also announced the expansion of its Board, appointing Cia Buckley Marakovits and David Kieske as independent directors, effective February 24, 2026. Ms. Marakovits has been appointed to serve on the Nominating/Corporate Governance Committee, and Mr. Kieske has been appointed to serve on the Audit Committee.
Ms. Marakovits is the President, Chief Investment Officer and Co-Owner of Dune Real Estate Partners. She has served as a Director of the Pension Real Estate Association since 2021, and sits on the Boards of SparkYouth NYC and Phillips Exeter Academy. She holds a Bachelor of Arts in Economics from Lafayette College and a Master of Business Administration from Columbia University.
Mr. Kieske is the Executive Vice President, Chief Financial Officer and Treasurer at VICI Properties Inc., an S&P 500 real estate investment trust, and previously served as Special Advisor to the Chief Executive Officer. Before joining VICI Properties, Mr. Kieske was a Managing Director at Wells Fargo/Eastdil Secured and has over 20 years of real estate and capital markets experience. He holds a Bachelor of Science degree in Managerial Economics from the University of California, Davis, and a Master of Business Administration from the University of California, Los Angeles.
“We are excited to welcome Cia and David to Kilroy’s Board,” Ms. Aman added. “Their deep experience and proven leadership within the real estate industry, as well as their strong financial and investment backgrounds, will further strengthen our ability to navigate a dynamic market and uphold the highest standards of corporate stewardship.”
With these additions, the Board approved an increase in the number of directors from seven to nine, effective February 24, 2026.
OTHER GOVERNANCE UPDATES
Additionally, the Board announced several changes to the responsibilities and composition of its committees, effective February 24, 2026. As part of an ongoing effort to streamline and enhance Board oversight, the Nominating/Corporate Governance Committee of the Board will assume oversight of the Company’s environmental sustainability initiatives and broader social governance responsibilities, and the Corporate Social Responsibility and Sustainability Committee will be disbanded. In addition, the Executive Compensation Committee of the Board will assume oversight of all human capital management initiatives. To support the Nominating/Corporate Governance Committee and the Executive Compensation Committee in their expanded oversight responsibilities, the Audit Committee of the Board will assume oversight of sustainability data and the risk exposure of the company related to corporate social responsibility, environmental sustainability, and human capital management.
Lastly, the Company announced that Peter Stoneberg will not stand for re-election to the Board at the Company’s 2026 annual meeting of stockholders and will retire from the Board upon completion of his existing term, which expires at the 2026 annual meeting of stockholders. “On behalf of the entire Board, I want to extend our sincere gratitude to Peter for more than 12 years of dedicated service,” said Dr. Brennan. “His industry and financial expertise and deep commitment to our mission have helped guide Kilroy through significant change and progress. We are profoundly thankful for his contributions and wish him continued success in all that lies ahead.”
About Kilroy Realty Corporation
Kilroy is a leading U.S. landlord and developer, with operations in the San Francisco Bay Area, Los Angeles, Seattle, San Diego, and Austin. The Company has earned global recognition for sustainability, building operations, innovation, and design. As a pioneer and innovator in the creation of a more sustainable real estate industry, the Company’s approach to modern business environments helps drive creativity and productivity for some of the world’s leading technology, media, life science, and business services companies.
The Company is a publicly traded real estate investment trust (“REIT”) and member of the S&P MidCap 400 Index with more than seven decades of experience developing, acquiring, and managing office, life science, and mixed-use projects.
As of December 31, 2025, Kilroy’s stabilized portfolio totaled approximately 16.3 million square feet of primarily office and life science space that was 81.6% occupied and 83.8% leased. The Company also had approximately 1,000 residential units in Hollywood and San Diego, which had a quarterly average occupancy of 94.1%. In addition, the Company had one development project in the tenant improvement phase totaling approximately 872,000 square feet with a total estimated investment of $1.2 billion.
A Leader in Sustainability and Commitment to Corporate Social Responsibility
Kilroy has a longstanding commitment to sustainability and continues to be a recognized leader in our sector. For over a decade, the Company and its sustainability initiatives have been recognized with numerous honors, including earning the GRESB five star rating and being named a sector and regional leader in the Americas. Other honors have included the Nareit Leader in the Light Award, being listed on the Dow Jones Sustainability World Index, being named ENERGY STAR Partner of the Year, and receiving the ENERGY STAR highest honor of Sustained Excellence.
Kilroy is proud to have achieved carbon neutral operations across our portfolio since 2020. The Company also has a longstanding commitment to maintain high levels of LEED, Fitwell, and ENERGY STAR certifications across the portfolio.
Kilroy is committed to cultivating a company culture that makes a positive difference in our employees’ lives by focusing on development, celebrating our unique backgrounds, promoting employee health and wellness, and dedicating ourselves to being a responsible corporate citizen through our community service and philanthropic efforts.
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. 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 or implied in the forward-looking statements, and you should not rely on the 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 the forward-looking statements, including, among others: global market and general economic conditions, including actual and potential tariffs and periods of heightened inflation, and their effect on our liquidity and financial conditions and those of our tenants; adverse economic or real estate conditions generally, and specifically, in the States of California, Texas, and Washington; risks associated with our investment in real estate assets, which are illiquid, and with trends in the real estate industry; defaults on or non-renewal of leases by tenants; any significant downturn in tenants’ businesses, including bankruptcy, lack of liquidity or lack of funding, and the impact labor disruptions or strikes, such as episodic strikes in the media industry, may have on our tenants’ businesses; our ability to re-lease property at or above current market rates; reduced demand for office space, including as a result of remote working and flexible working arrangements that allow work from remote locations other than an employer's office premises; costs to comply with government regulations, including environmental remediation; the availability of cash for distribution and debt service, and exposure to risk of default under debt obligations; increases in interest rates and our ability to manage interest rate exposure; changes in interest rates and the availability of financing on attractive terms or at all, which may adversely impact our future interest expense and our ability to pursue development, redevelopment, and acquisition opportunities and refinance existing debt; a decline in real estate asset valuations, which may limit our ability to dispose of assets at attractive prices, or obtain or maintain debt financing, and which may result in write-offs or impairment charges; significant competition, which may decrease the occupancy and rental rates of properties; potential losses that may not be covered by insurance; the ability to successfully complete acquisitions and dispositions on announced terms; the ability to successfully operate acquired, developed, and redeveloped properties; the ability to successfully complete development and redevelopment projects on schedule and within budgeted amounts; delays or refusals in obtaining all necessary zoning, land use, and other required entitlements, governmental permits and authorizations for our development and redevelopment properties; increases in anticipated capital expenditures, tenant improvement, and/or leasing costs; defaults on leases for land on which some of our properties are located; adverse changes to, or enactment or implementations of, tax laws or other applicable laws, regulations, or legislation, as well as business and consumer reactions to such changes; risks associated with joint venture investments, including our lack of sole decision-making authority, our reliance on co-venturers’ financial condition, and disputes between us and our co-venturers; environmental uncertainties and risks related to natural disasters; risks associated with climate change and our sustainability strategies, and our ability to achieve our sustainability goals; and our ability to maintain our status as a REIT. These factors are not exhaustive and additional factors could adversely affect our business and financial performance. 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, 2025, 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 dates 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 we are required to do so in connection with our ongoing requirements under federal securities laws.
View source version on businesswire.com: https://www.businesswire.com/news/home/20260225822332/en/
Doug Bettisworth
Vice President, Corporate Finance
(310) 481-8585
Original: Kilroy Realty Corporation Announces Board Refreshment
US Market News
4月前
Kilroy Realty Corporation Reports Fourth Quarter and Full Year Financial ResultsFebruary 9, 2026 4:07 PM
Business Wire
Kilroy Realty Corporation (NYSE: KRC) (“Kilroy” or the “Company”) today reported financial results for the fourth quarter and full year ended December 31, 2025.
“Our strong performance in the fourth quarter capped off an exceptional year of execution by the entire Kilroy Team,” said Angela Aman, Chief Executive Officer. “We captured growing tenant demand for high quality, well-amenitized office and life science projects across virtually all of our submarkets, made substantial progress on leasing our in-process redevelopment and development projects, and capitalized on a resurgence of institutional investor interest in West Coast commercial real estate assets in order to refine and enhance our portfolio. As we look ahead to 2026, we are encouraged by the continued momentum we are experiencing across our platform and believe we are well positioned for continued growth and evolution.”
Fourth Quarter Highlights
Financial Results
Revenues of $272.2 million for the quarter ended December 31, 2025, as compared to $286.4 million for the quarter ended December 31, 2024
Net income available to common stockholders of $12.4 million, or $0.10 per diluted share, for the quarter ended December 31, 2025, as compared to $59.5 million, or $0.50 per diluted share, for the quarter ended December 31, 2024
Funds from operations (“FFO”) of $117.2 million, or $0.97 per diluted share, for the quarter ended December 31, 2025, as compared to $144.9 million, or $1.20 per diluted share, for the quarter ended December 31, 2024
Leasing and Occupancy
Stabilized Portfolio was 81.6% occupied and 83.8% leased at December 31, 2025, representing 220 basis points of leases signed that have not commenced
During the quarter, signed approximately 827,000 square feet of leases, the Company’s strongest fourth-quarter leasing performance in six years
Leasing activity was comprised of 547,000 square feet of new leasing on previously vacant space, 148,000 square feet of new leasing on currently occupied space, and 132,000 square feet of renewal leasing
At Kilroy Oyster Point Phase 2 (“KOP 2”), signed 316,000 square feet of new leases. See “Kilroy Oyster Point Phase 2” section below for additional details
Leasing activity during the quarter included 60,000 square feet of short-term leasing
GAAP and cash rents on leases signed during the quarter decreased 16.8% and 27.1%, respectively, from prior levels on Second Generation leasing, excluding short-term leasing
Leasing spreads during the quarter were negatively impacted by:
A new lease signed on a space recently vacated due to a tenant bankruptcy
A renewal signed to preserve near-term income on a single-tenant building while the Company evaluates alternative uses
Excluding these two leases, GAAP and cash rents on leases signed during the quarter would have increased 16.2% and decreased 2.6%, respectively
Capital Recycling Activity
Dispositions / Held for Sale / Assets Under Contract:
In December, completed the sale of Sunset Media Center, an approximately 326,000-square-foot office property in the Hollywood submarket of Los Angeles, for gross sales proceeds of $61.0 million
In December, entered into an agreement, subject to a non-refundable deposit, to sell Kilroy Sabre Springs, a three-building campus in the I-15 Corridor submarket of San Diego, and classified the campus as Held for Sale. The campus totals approximately 428,000 square feet, and the sale closed in January for gross sales proceeds of $124.5 million
In December, entered into an agreement to sell the remaining portion of the land at Santa Fe Summit for $86.0 million in gross sales proceeds. The transaction represents approximately 17 acres of the 22-acre site and is expected to close upon receipt of entitlements for residential development
Acquisitions:
In December, completed the acquisition of the Nautilus Campus, a four-building, approximately 232,000-square-foot life science campus, in the Torrey Pines submarket of San Diego, for $192.0 million
Dividend
The Board declared and paid a regular quarterly cash dividend on its common stock of $0.54 per share, equivalent to an annual rate of $2.16 per share. The dividend was paid on January 7, 2026 to stockholders of record on December 31, 2025 (the ex-dividend date)
Full Year Highlights
Financial Results
Revenues of $1,112.7 million for the year ended December 31, 2025, as compared to $1,135.6 million for the year ended December 31, 2024
Net income available to common stockholders of $276.1 million, or $2.32 per diluted share, for the year ended December 31, 2025, as compared to $211.0 million, or $1.77 per diluted share, for the year ended December 31, 2024
Funds from operations (“FFO”) of $505.9 million, or $4.20 per diluted share, for the year ended December 31, 2025, as compared to $551.6 million, or $4.59 per diluted share, for the year ended December 31, 2024
Leasing and Occupancy
During the year, signed approximately 2,051,000 square feet of leases, the Company’s highest annual leasing volume since 2019
Leasing activity was comprised of 1,108,000 square feet of new leasing on previously vacant space, 233,000 square feet of new leasing on currently occupied space, and 710,000 square feet of renewal leasing
Leasing activity during the year included 270,000 square feet of short-term leasing, primarily comprised of 187,000 square feet of short-term renewal leasing
GAAP and cash rents on leases signed during the year decreased 9.3% and 18.4%, respectively, from prior levels on Second Generation leasing, excluding short-term leasing
Kilroy Oyster Point Phase 2
As highlighted above, signed approximately 316,000 square feet of leases during the fourth quarter for a total of 384,000 square feet of leases signed at KOP 2 during the year, exceeding the Company’s previously communicated goal of 100,000 square feet of lease executions. The project is now 3% occupied and 44% leased
Leasing activity at KOP 2 during the fourth quarter was comprised of the following transactions:
The University of California, San Francisco executed a full-building lease spanning approximately 280,000 square feet and is expected to commence occupancy in the fourth quarter of 2027
A new genomic sequencing foundry signed an approximately 20,000-square-foot lease in a space designed and built as part of the Company’s spec suite initiative. The company commenced occupancy upon lease execution in the fourth quarter of 2025
Acadia Pharmaceuticals executed an approximately 16,000-square-foot lease and is expected to commence occupancy at KOP 2 in the second quarter of 2026
Development / Redevelopment
During the first quarter of 2025, received a temporary certificate of occupancy and progressed KOP 2 from the under construction phase to the tenant improvement phase
During the third quarter of 2025, added 4690 Executive Drive, an approximately 52,000-square-foot redevelopment project in the University Towne Center submarket of San Diego, to the stabilized portfolio. The property is 47% leased
During the third quarter of 2025, added 4400 Bohannon Drive, an approximately 48,000-square-foot redevelopment project in the Other Peninsula submarket of the San Francisco Bay Area, to the stabilized portfolio. The property is 0% leased
Capital Recycling Activity
In addition to the capital recycling activities highlighted above, the following transactions occurred during the year:
Dispositions / Assets Under Contract:
In April, entered into an agreement, subject to a non-refundable deposit, to sell a portion of the land at Santa Fe Summit for $38.0 million in gross sales proceeds. The transaction represents approximately five acres of the 22-acre site and is anticipated to close upon the receipt of entitlements, which is expected to occur in 2026
In June, completed the sale of 501 Santa Monica Boulevard, an approximately 79,000-square-foot operating property in West Los Angeles for gross sales proceeds of $40.0 million
In July, entered into an agreement, subject to a non-refundable deposit, for the sale of 1633 26th Street for $41.0 million in gross sales proceeds. The transaction is anticipated to close upon the receipt of entitlements, which is expected to occur in 2026
In September, completed the sale of a four-building, approximately 663,000-square-foot campus in Silicon Valley for gross sales proceeds of $365.0 million
Acquisitions:
In September, completed the acquisition of Maple Plaza, an approximately 306,000-square-foot office property in the Beverly Hills submarket of Los Angeles, for $205.3 million
Balance Sheet / Liquidity
In August, completed a public offering of $400.0 million of 5.875% unsecured senior notes due October 2035
In September, fully redeemed $400.0 million of 4.375% unsecured senior notes due October 2025
As of December 31, 2025, the Company had approximately $1.3 billion of total liquidity, comprised of approximately $0.2 billion of cash and cash equivalents and approximately $1.1 billion available under the fully undrawn unsecured revolving credit facility
Sustainability and Corporate Social Responsibility Highlights
Achieved carbon neutral operations across the portfolio for the sixth consecutive year
Over six megawatts of installed onsite solar capacity generating clean electricity
Listed on U.S. EPA’s National Top 100 list of largest green power users
Earned GRESB 5-Star Designation for Standing Assets
Earned GRESB Regional Sector Leader in the Americas in Technology/Life Science for Development
Achieved the most ENERGY STAR NextGen certifications of any building owner since the launch of the new certification program in 2024
Achieved over 1.6 million square feet of new ENERGY STAR certifications across the portfolio, bringing the total to over 10.9 million square feet of ENERGY STAR certified space
Became a Fitwel Champion+ company
Maintained Green Lease Leader Gold status
Recent Developments
In January, added KOP 2 to the stabilized portfolio
In January, completed the sale of Kilroy Sabre Springs
Net Income Available to Common Stockholders / FFO Guidance
The Company is initiating Nareit-defined FFO per share guidance for 2026 of $3.25 to $3.45 per diluted share. The table below reflects key assumptions for 2026 guidance.
Key Assumptions
2026 Assumptions
Average full year occupancy
76.0% to 78.0%
Average full year occupancy excluding KOP 2
80.0% to 81.5%
Same Property Cash Net Operating Income (“NOI”) growth (1)
(1.50%) to 0.00%
NOI from Development Properties (2)
($23.5) to ($25.0 million)
Non-Cash GAAP NOI adjustments (1) (3)
$12 to $14 million
GAAP lease termination fee income
$3.0 to $4.5 million
General and administrative and Leasing costs
$89 to $91 million
Interest income
$2 to $3 million
Gross interest expense
$212 to $214 million
Capitalized interest (4)
$32 to $34 million
Total development spending (5)
$150 to $200 million
Dispositions
+/- $300 million
Full Year 2026 Range
Low End
High End
$ and shares/units in thousands,
except per share/unit amounts
Net income available to common stockholders per share - diluted
$
0.59
$
0.79
Weighted average common shares outstanding - diluted (6)
120,100
120,100
Net income available to common stockholders
$
70,800
$
95,040
Adjustments:
Net income attributable to noncontrolling common units of the Operating Partnership
300
300
Net income attributable to noncontrolling interests in consolidated property partnerships
17,000
17,000
Depreciation and amortization of real estate assets
342,000
342,000
Gain on sale of depreciable operating property
(8,200
)
(8,200
)
Funds From Operations attributable to noncontrolling interests in consolidated property partnerships
(28,000
)
(28,000
)
Funds From Operations (1)
$
393,900
$
418,140
Weighted average common shares/units outstanding – diluted (7)
121,200
121,200
Nareit Funds From Operations per common share/unit – diluted (1)
$
3.25
$
3.45
____________________
(1)
For additional information, please refer to pages 35-37 “Non-GAAP Supplemental Measures” of the Company’s Supplemental Financial Report furnished on Form 8-K for management statements on the Company’s non-GAAP measures.
(2)
NOI from Development Properties is primarily comprised of carry costs associated with Company’s KOP 2 and Flower Mart projects. Guidance assumes the continued capitalization of the Company’s Flower Mart project through June 2026.
(3)
Non-Cash GAAP NOI adjustments include the following items: Amortization of deferred revenue related to tenant-funded tenant improvements, Straight-line rents, net, Amortization of net below market rents, and Lease related adjustments and other.
(4)
Capitalized interest guidance assumes the continued capitalization of the Company’s Flower Mart project through June 2026.
(5)
Total development spending includes recently stabilized, in-process, and future development projects.
(6)
Calculated based on estimated weighted average shares outstanding, including non-participating share-based awards and the dilutive impact of contingently issuable shares.
(7)
Calculated based on the weighted average shares outstanding, including participating and non-participating share-based awards, and the dilutive impact of contingently issuable shares, and assuming the exchange of all common limited partnership units outstanding. Reported amounts are attributable to common stockholders, common unitholders, and restricted stock unitholders.
The Company’s guidance estimates for the full year 2026, and the reconciliation of Net income available to common stockholders per share - diluted and FFO per share and unit - diluted included within this press release, reflect management’s views on current and future market conditions, including assumptions with respect to rental rates, occupancy levels, and the earnings impact of the events referenced in this press release. These guidance estimates do not include the impact on the Company’s operating results from any events outside of the Company’s control, as the timing and magnitude of any such events are not known at the time the Company provides guidance. There can be no assurance that the Company’s actual results will not differ materially from these estimates.
Conference Call and Audio Webcast
The Company’s management will discuss fourth quarter results and the current business environment during the Company’s February 10, 2026 earnings conference call. The call will begin at 10:00 a.m. Pacific Time and last approximately one hour. To participate and obtain conference call dial-in details, register by using the following link, https://www.netroadshow.com/events/login/LE9zwo4AF0rVUaxBU0IDSIu6q6M8vLBYYMS. Those interested in listening via the Internet can access the conference call at https://events.q4inc.com/attendee/267439370. It may be necessary to download audio software to hear the conference call.
About Kilroy Realty Corporation
Kilroy is a leading U.S. landlord and developer, with operations in the San Francisco Bay Area, Los Angeles, Seattle, San Diego, and Austin. The Company has earned global recognition for sustainability, building operations, innovation, and design. As a pioneer and innovator in the creation of a more sustainable real estate industry, the Company’s approach to modern business environments helps drive creativity and productivity for some of the world’s leading technology, media, life science, and business services companies.
The Company is a publicly traded real estate investment trust (“REIT”) and member of the S&P MidCap 400 Index with more than seven decades of experience developing, acquiring, and managing office, life science, and mixed-use projects.
As of December 31, 2025, Kilroy’s stabilized portfolio totaled approximately 16.3 million square feet of primarily office and life science space that was 81.6% occupied and 83.8% leased. The Company also had approximately 1,000 residential units in Hollywood and San Diego, which had a quarterly average occupancy of 94.1%. In addition, the Company had one development project in the tenant improvement phase totaling approximately 872,000 square feet with a total estimated investment of $1.2 billion.
A Leader in Sustainability and Commitment to Corporate Social Responsibility
Kilroy has a longstanding commitment to sustainability and continues to be a recognized leader in our sector. For over a decade, the Company and its sustainability initiatives have been recognized with numerous honors, including earning the GRESB five star rating and being named a sector and regional leader in the Americas. Other honors have included the Nareit Leader in the Light Award, being listed on the Dow Jones Sustainability World Index, being named ENERGY STAR Partner of the Year, and receiving the ENERGY STAR highest honor of Sustained Excellence.
Kilroy is proud to have achieved carbon neutral operations across our portfolio since 2020. The Company also has a longstanding commitment to maintain high levels of LEED, Fitwell, and ENERGY STAR certifications across the portfolio.
Kilroy is committed to cultivating a company culture that makes a positive difference in our employees’ lives by focusing on development, celebrating our unique backgrounds, promoting employee health and wellness, and dedicating ourselves to being a responsible corporate citizen through our community service and philanthropic efforts.
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. 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 or implied in the forward-looking statements, and you should not rely on the 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 the forward-looking statements, including, among others: global market and general economic conditions, including actual and potential tariffs and periods of heightened inflation, and their effect on us and our tenants; adverse economic or real estate conditions generally, and specifically, in the States of California, Texas, and Washington; risks associated with our investment in real estate assets, which are illiquid, and with trends in the real estate industry; defaults on or non-renewal of leases by tenants; any significant downturn in tenants’ businesses, including bankruptcy, lack of liquidity or lack of funding, and the impact labor disruptions or strikes, such as episodic strikes in the media industry, may have on our tenants’ businesses; our ability to re-lease property at or above current market rates; reduced demand for office space, including as a result of remote working and flexible working arrangements that allow work from remote locations other than an employer's office premises; costs to comply with government regulations, including environmental remediation; the availability of cash for distribution and debt service, and exposure to risk of default under debt obligations; increases in interest rates and our ability to manage interest rate exposure; changes in interest rates and the availability of financing on attractive terms or at all, which may adversely impact our future interest expense and our ability to pursue development, redevelopment, and acquisition opportunities and refinance existing debt; a decline in real estate asset valuations, which may limit our ability to dispose of assets at attractive prices, or obtain or maintain debt financing, and which may result in write-offs or impairment charges; significant competition, which may decrease the occupancy and rental rates of properties; potential losses that may not be covered by insurance; the ability to successfully complete acquisitions and dispositions on announced terms; the ability to successfully operate acquired, developed, and redeveloped properties; the ability to successfully complete development and redevelopment projects on schedule and within budgeted amounts; delays or refusals in obtaining all necessary zoning, land use, and other required entitlements, governmental permits and authorizations for our development and redevelopment properties; increases in anticipated capital expenditures, tenant improvement, and/or leasing costs; defaults on leases for land on which some of our properties are located; adverse changes to, or enactment or implementations of, tax laws or other applicable laws, regulations, or legislation, as well as business and consumer reactions to such changes; risks associated with joint venture investments, including our lack of sole decision-making authority, our reliance on co-venturers’ financial condition, and disputes between us and our co-venturers; environmental uncertainties and risks related to natural disasters; risks associated with climate change and our sustainability strategies, and our ability to achieve our sustainability goals; and our ability to maintain our status as a REIT. These factors are not exhaustive and additional factors could adversely affect our business and financial performance. 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, 2024, 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 dates 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 we are required to do so in connection with our ongoing requirements under federal securities laws.
KILROY REALTY CORPORATION
SUMMARY OF QUARTERLY RESULTS
(unaudited; in thousands, except per share data)
Three Months Ended December 31,
Year Ended December 31,
2025
2024
2025
2024
Revenues
$
272,187
$
286,379
$
1,112,667
$
1,135,629
Net income available to common stockholders
$
12,444
$
59,460
$
276,121
$
210,969
Weighted average common shares outstanding – basic
118,338
118,047
118,279
117,649
Weighted average common shares outstanding – diluted
119,153
118,759
118,832
118,157
Net income available to common stockholders per share – basic
$
0.10
$
0.50
$
2.33
$
1.78
Net income available to common stockholders per share – diluted
$
0.10
$
0.50
$
2.32
$
1.77
Funds From Operations (1)(2)
$
117,158
$
144,875
$
505,920
$
551,633
Weighted average common shares/units outstanding – basic (3)
119,869
119,521
119,835
119,729
Weighted average common shares/units outstanding – diluted (4)
120,684
120,234
120,388
120,236
Funds From Operations per common share/unit – basic (2)
$
0.98
$
1.21
$
4.22
$
4.61
Funds From Operations per common share/unit – diluted (2)
$
0.97
$
1.20
$
4.20
$
4.59
Common shares outstanding at end of period
118,372
118,047
Common partnership units outstanding at end of period
1,134
1,151
Total common shares and units outstanding at end of period
119,506
119,198
December 31, 2025
December 31, 2024
Stabilized office portfolio occupancy rates: (5)
Los Angeles
75.1
%
75.0
%
San Diego
83.7
%
89.2
%
San Francisco Bay Area
86.2
%
87.4
%
Seattle
80.0
%
80.5
%
Austin
82.2
%
74.7
%
Weighted average total
81.6
%
82.8
%
Total square feet of stabilized office properties owned at end of period: (5)
Los Angeles
4,242
4,340
San Diego
2,728
2,877
San Francisco Bay Area
5,565
6,171
Seattle
2,998
2,996
Austin
759
759
Total
16,292
17,143
____________________
(1)
Reconciliation of Net income available to common stockholders to Funds From Operations available to common stockholders and unitholders and management statement on Funds From Operations are included after the Consolidated Statements of Operations.
(2)
Reported amounts are attributable to common stockholders, common unitholders and restricted stock unitholders.
(3)
Calculated based on weighted average shares outstanding, including participating share-based awards (i.e., nonvested stock and certain time-based restricted stock units) and assuming the exchange of all common limited partnership units outstanding.
(4)
Calculated based on weighted average shares outstanding, including participating and non-participating share-based awards, dilutive impact of contingently issuable shares, and assuming the exchange of all common limited partnership units outstanding.
(5)
Occupancy percentages and total square feet reported are based on the Company’s stabilized office portfolio for the periods presented.
KILROY REALTY CORPORATION
CONSOLIDATED BALANCE SHEETS
(unaudited; in thousands)
December 31, 2025
December 31, 2024
ASSETS
Real Estate Assets
Land
$
1,641,913
$
1,750,820
Buildings and improvements
8,505,486
8,598,751
Undeveloped land and construction in progress
2,387,742
2,309,624
Total real estate assets held for investment
12,535,141
12,659,195
Accumulated depreciation and amortization
(2,843,811
)
(2,824,616
)
Total real estate assets held for investment, net
9,691,330
9,834,579
Real estate and other assets held for sale, net
115,155
—
Cash and cash equivalents
179,316
165,690
Marketable securities
30,807
27,965
Current receivables, net
12,765
11,033
Deferred rent receivables, net
424,794
451,996
Deferred leasing costs and acquisition-related intangible assets, net
278,232
225,937
Right of use ground lease assets, net
128,116
129,222
Prepaid expenses and other assets, net
54,561
51,935
TOTAL ASSETS
$
10,915,076
$
10,898,357
LIABILITIES AND EQUITY
Liabilities:
Secured debt, net
$
592,685
$
598,199
Unsecured debt, net
3,996,774
3,999,566
Accounts payable, accrued expenses, and other liabilities
288,963
285,011
Ground lease liabilities
127,628
128,422
Accrued dividends and distributions
65,009
64,850
Deferred revenue and acquisition-related intangible liabilities, net
125,628
142,437
Rents received in advance and tenant security deposits
75,701
71,003
Liabilities related to real estate assets held for sale
4,945
—
Total liabilities
5,277,333
5,289,488
Equity:
Stockholders’ Equity
Common stock
1,184
1,181
Additional paid-in capital
5,230,747
5,209,653
Retained earnings
188,876
171,212
Total stockholders’ equity
5,420,807
5,382,046
Noncontrolling Interests
Common units of the Operating Partnership
51,911
52,472
Consolidated property partnerships
165,025
174,351
Total noncontrolling interests
216,936
226,823
Total equity
5,637,743
5,608,869
TOTAL LIABILITIES AND EQUITY
$
10,915,076
$
10,898,357
KILROY REALTY CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited; in thousands, except per share data)
Three Months Ended December 31,
Year Ended December 31,
2025
2024
2025
2024
Revenues
Rental income
$
267,363
$
281,355
$
1,093,587
$
1,118,115
Other property income
4,824
5,024
19,080
17,514
Total revenues
272,187
286,379
1,112,667
1,135,629
Expenses
Property expenses
64,673
63,249
243,726
243,441
Real estate taxes
26,556
24,026
107,564
108,951
Ground leases
2,991
2,990
12,048
11,715
General and administrative expenses
19,485
16,977
73,108
71,074
Leasing costs
2,592
2,013
10,352
8,764
Depreciation and amortization
92,623
89,121
354,854
356,182
Total expenses
208,920
198,376
801,652
800,127
Other Income (Expenses)
Interest income
2,205
4,790
6,970
37,752
Interest expense
(32,148
)
(33,245
)
(126,292
)
(145,287
)
Other income (expense) (1)
44
(493
)
168
(992
)
Gains on sales of depreciable operating properties
—
—
127,038
—
Impairment of real estate assets
(16,259
)
—
(16,259
)
—
Gain on sale of long-lived assets
—
5,979
—
5,979
Total other expenses
(46,158
)
(22,969
)
(8,375
)
(102,548
)
Net income
17,109
65,034
302,640
232,954
Net income attributable to noncontrolling common units of the Operating Partnership
(120
)
(593
)
(2,682
)
(2,062
)
Net income attributable to noncontrolling interests in consolidated property partnerships
(4,545
)
(4,981
)
(23,837
)
(19,923
)
Total net income attributable to noncontrolling interests
(4,665
)
(5,574
)
(26,519
)
(21,985
)
Net income available to common stockholders
$
12,444
$
59,460
$
276,121
$
210,969
Weighted average shares of common stock outstanding – basic
118,338
118,047
118,279
117,649
Weighted average shares of common stock outstanding – diluted
119,153
118,759
118,832
118,157
Net income available to common stockholders per share – basic
$
0.10
$
0.50
$
2.33
$
1.78
Net income available to common stockholders per share – diluted
$
0.10
$
0.50
$
2.32
$
1.77
____________________
(1)
Commencing January 1, 2025, the Company began presenting a new line item, Other income (expense), which includes tax expenses, acquisition and disposition expenses, and income or expenses related to environmental and sustainability initiatives, all of which were previously included in General and administrative expenses. Historical amounts for General and administrative expenses and Other income (expense) have been revised to conform with the current period presentation.
KILROY REALTY CORPORATION
FUNDS FROM OPERATIONS
(unaudited; in thousands, except per share data)
Three Months Ended December 31,
Year Ended December 31,
2025
2024
2025
2024
Net income available to common stockholders
$
12,444
$
59,460
$
276,121
$
210,969
Adjustments:
Net income attributable to noncontrolling common units of the Operating Partnership
120
593
2,682
2,062
Net income attributable to noncontrolling interests in consolidated property partnerships
4,545
4,981
23,837
19,923
Depreciation and amortization of real estate assets
91,213
87,536
349,271
349,828
Gains on sales of depreciable operating properties
—
—
(127,038
)
—
Impairment of real estate assets
16,259
—
16,259
—
Funds From Operations attributable to noncontrolling interests in consolidated property partnerships
(7,423
)
(7,695
)
(35,212
)
(31,149
)
Funds From Operations (1)(2)(3)
$
117,158
$
144,875
$
505,920
$
551,633
Weighted average common shares/units outstanding – basic (4)
119,869
119,521
119,835
119,729
Weighted average common shares/units outstanding – diluted (5)
120,684
120,234
120,388
120,236
Funds From Operations per common share/unit – basic (2)
$
0.98
$
1.21
$
4.22
$
4.61
Funds From Operations per common share/unit – diluted (2)
$
0.97
$
1.20
$
4.20
$
4.59
____________________
(1)
The Company calculates Funds From Operations available to common stockholders and common unitholders (“FFO”) in accordance with the 2018 Restated 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 depreciation and amortization related to real estate, gains and losses from the sale of certain real estate assets, gains and losses from change in control, and impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity. The reconciling items include amounts to adjust earnings from consolidated partially-owned entities and equity in earnings of unconsolidated affiliates to FFO. Our calculation of FFO includes the amortization of deferred revenue related to tenant-funded tenant improvements and excludes the depreciation of the related tenant improvement assets. We also add back net income attributable to noncontrolling common units of the Operating Partnership because we report FFO attributable to common stockholders and common unitholders.
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 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.
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, common unitholders, and restricted stock unitholders.
(3)
FFO available to common stockholders and unitholders includes amortization of deferred revenue related to tenant-funded tenant improvements of $3.5 million and $4.1 million for the three months ended December 31, 2025 and 2024, respectively, and $14.6 million and $19.1 million for the year ended December 31, 2025 and 2024, respectively.
(4)
Calculated based on weighted average shares outstanding, including participating share-based awards (i.e., certain time-based restricted stock units) and assuming the exchange of all common limited partnership units outstanding.
(5)
Calculated based on weighted average shares outstanding, including participating and non-participating share-based awards, dilutive impact of contingently issuable shares, and assuming the exchange of all common limited partnership units outstanding.
View source version on businesswire.com: https://www.businesswire.com/news/home/20260209538423/en/
Doug Bettisworth
Vice President, Corporate Finance
(310) 481-8585
Original: Kilroy Realty Corporation Reports Fourth Quarter and Full Year Financial Results
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