Kilroy Realty Corporation (NYSE: KRC) today reported
financial results for its fourth quarter ended
December 31, 2014.
Fourth Quarter Highlights
- Funds from operations (FFO) of $0.78
per share
- Net income available to common
stockholders of $0.32 per share, including a property-disposition
gain of $0.13 per share
- Revenues from continuing operations of
$141.8 million
Stabilized Portfolio
- Stabilized portfolio 94.4% occupied and
96.3% leased at December 31, 2014
- Signed new or renewing leases totaling
1,051,939 square feet
Development
- Delivered and stabilized a 341,000
square-foot, two-building office project located in Silicon
Valley’s Mountain View submarket
- Executed a 12-year, 180,000 square-foot
lease with Viacom at Columbia Square, a mixed-use development
project, located in Los Angeles’ Hollywood submarket
- Commenced development of The Heights at
Del Mar, an approximately 73,000 square-foot office project located
in San Diego’s Del Mar submarket
- Acquired two adjacent land sites
totaling approximately five acres in San Francisco’s Central SOMA
district for approximately $71.0 million
Acquisitions
- Acquired a four-building, 17-acre,
267,000 square-foot office campus in Silicon Valley’s Sunnyvale
submarket for approximately $100.5 million
Capital Recycling
- Completed the sale of two office
buildings located in San Rafael and Orange, California for total
gross proceeds of $60.2 million
Finance
- Repaid $135.5 million remaining
principal value of the 4.25% Exchangeable Notes in cash and issued
1,255,917 net shares of common stock representing the value of the
exchange option at maturity
- Raised $82.1 million of gross equity
proceeds under the company’s at-the-market (ATM) offering program;
established a new $300.0 million ATM offering program
Sustainability
- Awarded National Association of Real
Estate Investment Trust’s (NAREIT) Office Leader in the Light
Award
Recent Activity
- In January 2015, completed the sale of
a land site in Irvine, California for gross proceeds of $26.0
million
Results for the Quarter and Full Year Ended
December 31, 2014
For its fourth quarter ended December 31, 2014, KRC
reported FFO of $69.8 million, or $0.78 per share,
compared to $58.5 million, or $0.67 per share, in the
fourth quarter of 2013. Net income available to common stockholders
was $27.5 million, or $0.32 per share, compared to
$19.3 million, or $0.23 per share, in the year-earlier period.
Net income in both fourth-quarter 2014 and 2013 included net gains
from property dispositions of approximately $11.5 million and
$11.8 million, respectively. Including discontinued
operations, the company’s revenues in the fourth quarter of 2014
totaled $142.6 million, up from $128.0 million in the
fourth quarter of 2013.
For the year ended December 31, 2014, KRC reported FFO
of $250.7 million, or $2.85 per share, compared to
$218.6 million, or $2.66 per share, for the year ended
December 31, 2013. Net income available to common
stockholders in 2014 totaled $167.0 million, or $1.95 per
share, compared to $30.6 million, or $0.37 per share, in 2013.
FFO and net income for the fiscal year 2014 included a $3.5 million
gain related to the sale of land. Additionally, net income in
fiscal 2014 included approximately $121.9 million in gains from
property dispositions. Net income in fiscal 2013 included
approximately $12.3 million in gains from property
dispositions. Including discontinued operations, the company’s
revenues in 2014 totaled $529.2 million, up from
$497.8 million in the prior year.
Revenues from continuing operations in 2014 totaled
$521.7 million, up from $457.1 million in 2013.
All per share amounts in this report are presented on a diluted
basis.
Operating and Leasing Activity
At December 31, 2014, KRC’s stabilized portfolio
totaled approximately 14.1 million square feet of office space
located in Los Angeles, Orange County, San Diego,
the San Francisco Bay Area and greater Seattle. KRC signed new
or renewing leases on 1,051,939 square feet of space in the
stabilized portfolio during the fourth quarter. For the full year,
the company achieved annual leasing results in excess of three
million square feet. At year-end 2014, KRC’s stabilized portfolio
was 94.4% occupied, up from 94.1% at September 30, 2014 and
93.4% at year-end 2013, and was 96.3% leased.
Real Estate Acquisition, Development and Disposition
Activity
During the fourth quarter, KRC acquired a four-building, 267,000
square-foot office campus in Sunnyvale, California, for
approximately $100.5 million. The approximately 17-acre project is
100% leased. During the quarter, the company also completed the
purchase of two adjacent land sites totaling approximately five
acres in the central SOMA district of San Francisco for a total of
$71.0 million.
The company delivered and stabilized a 341,000 square-foot,
two-building office campus during the fourth quarter. The campus,
located in Mountain View, California, is 100% leased to Synposys,
Inc. for a term of 15 years.
At year-end 2014, KRC had six projects under construction
aggregating just over 1.7 million square feet with scheduled
completion dates ranging from spring 2015 through 2016. The company
estimates its total investment in these six projects will be
approximately $1.0 billion.
Within its current development program, KRC executed a 12-year
lease with global entertainment company Viacom in the fourth
quarter covering 180,000 square feet of space at KRC’s Columbia
Square mixed-use project in Hollywood, California. With this
transaction, 82% of the company’s office development under
construction is now pre-leased.
As part of its ongoing capital recycling program, KRC disposed
of two non-strategic office properties during the fourth quarter
for total gross proceeds of $60.2 million. In addition, the company
sold a land parcel in Irvine, California in mid-January for gross
proceeds of approximately $26.0 million.
Financing Activity
During the fourth quarter, KRC repaid $135.5 million in
principal of its remaining 4.25% Exchangeable Notes upon maturity
and issued 1,255,917 net shares of common stock, representing the
value of the exchange option at maturity. The company also
established a new at-the-market (ATM) program under which it may
sell up to $300.0 million of the company’s common stock in
periodic, at-the-market offerings. KRC raised $82.1 million in
gross proceeds during the quarter under the ATM.
Management Comments
“KRC had a very strong 2014,” said John Kilroy, Jr., the
company’s chairman, president and chief executive officer. “Against
a backdrop of steadily improving economic and commercial real
estate fundamentals, our teams met or exceeded every target we had
set for ourselves. We established a new company leasing record,
exceeding 3 million square feet of leases executed and boosted
preleasing in our office development program to 82%. We delivered
two Northern California development projects under budget and ahead
of schedule. We continued to find high quality, economically
attractive opportunities to add to our existing portfolio and
expand our development pipeline. And we maintained a vigorous
capital recycling effort to support our growth while maintaining
our financial strength.”
Conference Call and Audio Webcast
KRC management will discuss updated earnings guidance for fiscal
2015 during the company’s January 29, 2015 earnings
conference call. The call will begin at 10:00 a.m. Pacific Time and
last approximately one hour. Those interested in listening via the
Internet can access the conference call at http://www.kilroyrealty.com. Please go to the
website 15 minutes before the call and register. It may be
necessary to download audio software to hear the conference call.
Those interested in listening via telephone can access the
conference call at (888) 679-8035 reservation #26846809. A replay
of the conference call will be available via phone through February
5, 2015 at (888) 286-8010, reservation #95917980, or via the
Internet at the company’s website.
About Kilroy Realty Corporation
With more than 65 years’ experience owning, developing,
acquiring and managing real estate assets in West Coast real estate
markets, Kilroy Realty Corporation (KRC), a publicly traded real
estate investment trust and member of the S&P MidCap 400 Index,
is one of the region’s premier landlords. The company provides
physical work environments that foster creativity and productivity
and serves a broad roster of dynamic, innovation-driven tenants,
including technology, entertainment, digital media and health care
companies.
At December 31, 2014, the company’s stabilized
portfolio totaled 14.1 million square feet of office
properties, all located in the coastal regions of greater Seattle,
the San Francisco Bay Area, Los Angeles, Orange County and San
Diego. The company is recognized by the Global Real Estate
Sustainability Benchmark (GRESB) as the North American leader in
sustainability and was ranked first among 151 North American
participants across all asset types. At the end of the fourth
quarter, the company’s properties were 39% LEED certified and 56%
of eligible properties were ENERGY STAR certified. In addition, KRC
had approximately 1.7 million square feet of new office and
mixed-use development under construction with a total estimated
investment of approximately $1.0 billion. 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 in
forward-looking statements, and you should not rely on
forward-looking statements as predictions of future performance,
results or events. Numerous factors could cause actual future
performance, results and events to differ materially from those
indicated in forward-looking statements, including, among others,
risks associated with: investment in real estate assets, which are
illiquid; trends in the real estate industry; significant
competition, which may decrease the occupancy and rental rates of
properties; the ability to successfully complete acquisitions and
dispositions on announced terms; the ability to successfully
operate acquired properties; the availability of cash for
distribution and debt service and exposure of risk of default under
debt obligations; adverse changes to, or implementations of,
applicable laws, regulations or legislation; and the ability to
successfully complete development and redevelopment projects on
schedule and within budgeted amounts. These factors are not
exhaustive. For a discussion of additional factors that could
materially adversely affect our business and financial performance,
see the factors included under the caption “Risk Factors” in our
annual report on Form 10-K/A for the year ended December 31,
2013 and our other filings with the Securities and Exchange
Commission. All forward-looking statements are based on information
that was available, and speak only as of the date on which they are
made. We assume no obligation to update any forward-looking
statement made in this press release that becomes untrue because of
subsequent events, new information or otherwise, except to the
extent required in connection with ongoing requirements under U.S.
securities laws.
KILROY REALTY CORPORATION
SUMMARY QUARTERLY
RESULTS
(unaudited, in thousands, except per share
data)
Three Months Ended Year Ended
December 31, December 31, 2014
2013 2014 2013
Revenues from continuing operations $ 141,765 $ 118,604 $
521,725 $ 457,111 Revenues including discontinued operations
$ 142,628 $ 128,041 $ 529,222 $ 497,819 Net income available
to common stockholders (1)(2) $ 27,540 $ 19,316 $ 166,969 $ 30,630
Weighted average common shares outstanding – basic 84,767
82,071 83,090 77,344 Weighted average common shares outstanding –
diluted 85,956 83,761 84,968 77,344 Net income available to
common stockholders per share – basic (1)(2) $ 0.32 $ 0.23 $ 1.99 $
0.37 Net income available to common stockholders per share –
diluted (1)(2) $ 0.32 $ 0.23 $ 1.95 $ 0.37 Funds From
Operations (3)(4) $ 69,817 $ 58,482 $ 250,744 $ 218,621
Weighted average common shares/units outstanding – basic (5) 87,809
85,124 86,123 80,390 Weighted average common shares/units
outstanding – diluted (5) 88,997 86,813 88,001 82,155 Funds
From Operations per common share/unit – basic (5) $ 0.80 $ 0.69 $
2.91 $ 2.72 Funds From Operations per common share/unit – diluted
(5) $ 0.78 $ 0.67 $ 2.85 $ 2.66 Common shares outstanding at
end of period 86,260 82,154 Common partnership units outstanding at
end of period 1,804 1,805 Total common
shares and units outstanding at end of period 88,064 83,959
December 31, December 31, 2014
2013 Stabilized office portfolio occupancy
rates: (6) Los Angeles and Ventura Counties 92.8 % 93.7 % Orange
County 98.7 % 92.8 % San Diego County 90.9 % 90.8 % San Francisco
Bay Area 97.3 % 94.8 % Greater Seattle 98.1 % 96.7 %
Weighted average total 94.4 % 93.4 % Total square feet of
stabilized office properties owned at end of period: (6) Los
Angeles and Ventura Counties 3,506 3,507 Orange County 272 437 San
Diego County 4,244 4,368 San Francisco Bay Area 3,887 2,377 Greater
Seattle 2,188 2,048 Total 14,097 12,737
________________________
(1) Net income available to common stockholders and Funds From
Operations for the year ended December 31, 2014 includes $4.4
million related to a net lease termination fee. Net income
available to common stockholders and Funds From Operations for the
year ended December 31, 2013 includes a $3.7 million net cash
payment related to the default of a former tenant and the receipt
of a $5.2 million payment related to a property damage
settlement.
(2) Net income available to common stockholders includes gains
on dispositions of discontinued operations of $11.5 million and
$121.9 million for the three months and year ended
December 31, 2014, respectively, $11.8 million and $12.3
million for the three months and year ended
December 31, 2013, respectively, and a $3.5 million gain
on sale of land for the year ended December 31, 2014.
(3) Reconciliation of Net income available to common
stockholders to Funds From Operations and management statement on
Funds From Operations are included after the Consolidated
Statements of Operations.
(4) Reported amounts are attributable to common stockholders and
common unitholders.
(5) Calculated based on weighted average shares outstanding
including participating share-based awards and assuming the
exchange of all common limited partnership units outstanding.
(6) Occupancy percentages and total square feet reported are
based on the company’s stabilized office portfolio for the periods
presented. Occupancy percentages and total square feet shown for
December 31, 2013 include the office properties that were sold
during 2014.
KILROY REALTY
CORPORATION
CONSOLIDATED BALANCE
SHEETS
(in thousands)
December 31, 2014 December 31, 2013
(unaudited)
ASSETS
REAL ESTATE ASSETS: Land and improvements $ 877,633 $ 657,491
Buildings and improvements 4,059,639 3,590,699 Undeveloped land and
construction in progress 1,120,660 1,016,757
Total real estate assets held for investment 6,057,932
5,264,947 Accumulated depreciation and amortization (947,664
) (818,957 ) Total real estate assets held for investment,
net 5,110,268 4,445,990 Real estate assets and other assets
held for sale, net 8,211 213,100 Cash and cash equivalents 23,781
35,377 Restricted cash 75,185 49,780 Marketable securities 11,971
10,008 Current receivables, net 7,229 10,743 Deferred rent
receivables, net 156,416 127,123 Deferred leasing costs and
acquisition-related intangible assets, net 201,926 186,622 Deferred
financing costs, net 18,374 16,502 Prepaid expenses and other
assets, net 20,375 15,783 TOTAL ASSETS
$ 5,633,736 $ 5,111,028
LIABILITIES AND
EQUITY
LIABILITIES: Secured debt $ 546,292 $ 560,434 Exchangeable senior
notes, net — 168,372 Unsecured debt, net 1,783,121 1,431,132
Unsecured line of credit 140,000 45,000 Accounts payable, accrued
expenses and other liabilities 225,830 198,467 Accrued
distributions 32,899 31,490 Deferred revenue and
acquisition-related intangible liabilities, net 132,239 101,286
Rents received in advance and tenant security deposits 49,363
44,240 Liabilities of real estate assets held for sale 56
14,447 Total liabilities 2,909,800
2,594,868 EQUITY: Stockholders’ Equity
6.875% Series G Cumulative Redeemable Preferred stock 96,155 96,155
6.375% Series H Cumulative Redeemable Preferred stock 96,256 96,256
Common stock 863 822 Additional paid-in capital 2,635,900 2,478,975
Distributions in excess of earnings (162,964 )
(210,896 ) Total stockholders’ equity 2,666,210 2,461,312
Noncontrolling Interests Common units of the Operating Partnership
51,864 49,963 Noncontrolling interest in consolidated subsidiary
5,862 4,885 Total noncontrolling
interests 57,726 54,848 Total equity
2,723,936 2,516,160 TOTAL LIABILITIES
AND EQUITY $ 5,633,736 $ 5,111,028
KILROY REALTY
CORPORATION
CONSOLIDATED
STATEMENTS OF OPERATIONS
(unaudited, in thousands, except per share
data)
Three Months Ended Year Ended
December 31, December 31, 2014
2013 2014
2013 REVENUES Rental income $ 127,417 $
108,326 $ 466,328 $ 411,899 Tenant reimbursements 13,318 9,697
46,717 38,047 Other property income 1,030 581
8,680 7,165 Total revenues
141,765 118,604 521,725
457,111 EXPENSES Property expenses 25,066
24,220 100,514 94,115 Real estate taxes 12,469 10,288 45,197 39,417
Provision for bad debts — 200 58 396 Ground leases 769 839 3,075
3,504 General and administrative expenses 12,346 9,910 46,152
39,660 Acquisition-related expenses 211 575 1,479 1,962
Depreciation and amortization 53,770 50,236
202,417 188,887 Total expenses
104,631 96,268 398,892
367,941 OTHER (EXPENSES) INCOME Interest
income and other net investment (losses) gains (26 ) 551 561 1,635
Interest expense (17,691 ) (17,849 ) (67,571 )
(75,870 ) Total other (expenses) income (17,717 ) (17,298 )
(67,010 ) (74,235 ) INCOME FROM CONTINUING OPERATIONS BEFORE
GAIN ON SALE OF LAND
19,417 5,038 55,823 14,935 Gain on sale of land —
— 3,490 — INCOME FROM
CONTINUING OPERATIONS 19,417 5,038
59,313 14,935 DISCONTINUED
OPERATIONS: Income from discontinued operations 482 6,180 2,573
17,378 Gains on dispositions of discontinued operations
11,531 11,829 121,922
12,252 Total income from discontinued operations
12,013 18,009 124,495
29,630 NET INCOME 31,430 23,047 183,808 44,565
Net income attributable to noncontrolling
common units of the Operating Partnership
(578 ) (419 ) (3,589 ) (685 )
NET INCOME ATTRIBUTABLE TO KILROY REALTY CORPORATION 30,852 22,628
180,219 43,880 PREFERRED DIVIDENDS (3,312 )
(3,312 ) (13,250 ) (13,250 ) NET INCOME AVAILABLE TO
COMMON STOCKHOLDERS $ 27,540 $ 19,316 $ 166,969
$ 30,630 Weighted average common shares
outstanding – basic 84,767 82,071 83,090 77,344 Weighted average
common shares outstanding – diluted 85,956 83,761 84,968 77,344
Net income available to common stockholders per share –
basic $ 0.32 $ 0.23 $ 1.99 $ 0.37 Net
income available to common stockholders per share – diluted $ 0.32
$ 0.23 $ 1.95 $ 0.37
KILROY REALTY
CORPORATION
FUNDS FROM
OPERATIONS
(unaudited, in thousands, except per share
data)
Three Months Ended December 31, Year Ended
December 31, 2014
2013 2014
2013 Net income available to common stockholders $
27,540 $ 19,316 $ 166,969 $ 30,630 Adjustments: Net income
attributable to noncontrolling common units of the Operating
Partnership 578 419 3,589 685 Depreciation and amortization of real
estate assets 53,230 50,576 202,108 199,558 Gains on dispositions
of discontinued operations (11,531 ) (11,829 )
(121,922 ) (12,252 ) Funds From Operations (1)(2)(3) $
69,817 $ 58,482 $ 250,744 $ 218,621
Weighted average common shares/units outstanding – basic
87,809 85,124 86,123 80,390 Weighted average common shares/units
outstanding – diluted 88,997 86,813 88,001 82,155 Funds From
Operations per common share/unit – basic (3) $ 0.80 $ 0.69
$ 2.91 $ 2.72 Funds From Operations per common
share/unit – diluted (3) $ 0.78 $ 0.67 $ 2.85
$ 2.66
________________________
(1) We calculate FFO in accordance with the White Paper on FFO
approved by the Board of Governors of NAREIT. The White Paper
defines FFO as net income or loss calculated in accordance with
GAAP, excluding extraordinary items, as defined by GAAP, gains and
losses from sales of depreciable real estate and impairment
write-downs associated with depreciable real estate, plus real
estate-related depreciation and amortization (excluding
amortization of deferred financing costs and depreciation of
non-real estate assets) and after adjustment for unconsolidated
partnerships and joint ventures. 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 believe that FFO is a useful supplemental measure of our
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 our 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, our 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, we believe
that FFO along with the required GAAP presentations provides a more
complete measurement of our performance relative to our competitors
and a more appropriate basis on which to make decisions involving
operating, financing and investing activities than the required
GAAP presentations alone would provide.
However, FFO should not be viewed as an alternative measure of
our operating performance because 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 our properties, which are significant economic costs
and could materially impact our results from operations.
(2) FFO includes amortization of deferred revenue related to
tenant-funded tenant improvements of $3.3 million and
$3.1 million for the three months ended December 31, 2014
and 2013, respectively, and $11.0 million and
$10.7 million for the years ended December 31, 2014 and
2013, respectively.
(3) Reported amounts are attributable to common stockholders and
common unitholders.
Kilroy Realty CorporationTyler H. RoseExecutive Vice
Presidentand Chief Financial Officer(310) 481-8484orMichelle
NgoSenior Vice Presidentand Treasurer(310) 481-8581
Kilroy Realty (NYSE:KRC)
過去 株価チャート
から 6 2024 まで 7 2024
Kilroy Realty (NYSE:KRC)
過去 株価チャート
から 7 2023 まで 7 2024