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Kilroy Realty Corporation Announces Underwriters' Exercise of Overallotment Option

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LOS ANGELES--(BUSINESS WIRE)--Jun. 1, 2009-- Kilroy Realty Corporation (NYSE:KRC) today announced that the underwriters of its recent public offering of 8,750,000 shares of common stock exercised in full their option to purchase from the company an additional 1,312,500 shares of common stock to cover overallotments. Combined with the initial shares of common stock, the company will sell a total of 10,062,500 shares for aggregate net proceeds of approximately $191.7 million. The issuance and sale of all 10,062,500 shares is expected to close on Wednesday, June 3, 2009, subject to satisfaction of closing conditions. Merrill Lynch & Co. and J.P.Morgan acted as the joint book-running managers.

This offering is being made pursuant to an effective shelf registration statement and prospectus filed by Kilroy Realty Corporation with the Securities and Exchange Commission. This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities nor will there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.

When available, copies of the prospectus supplement and related prospectus for this offering may be obtained by contacting Merrill Lynch & Co., 4 World Financial Center, New York, NY 10080, Attention: Prospectus Department, telephone: (212) 449-1000, or J.P.Morgan, 4 Chase Metrotech Center, CS Level, Brooklyn, NY 11245, Attention: Prospectus Library, telephone: (718) 242-8002.

Some of the information presented in this release is forward looking in nature within the meaning of the Private Securities Litigation Reform Act of 1995, including statements related to the offering. Although Kilroy Realty Corporation believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, there can be no assurance that its expectations will be achieved. Certain factors that could cause actual results to differ materially from Kilroy Realty's expectations are set forth as risk factors in the company's Securities and Exchange Commission reports and filings. Included among these factors are changes in general economic conditions, including changes in the economic conditions affecting industries in which its principal tenants compete; Kilroy Realty's ability to timely lease or re-lease space at current or anticipated rents; changes in interest rates; changes in operating costs, including utility costs; future demand for its debt and equity securities; its ability to refinance its debt on reasonable terms at maturity; its ability to complete current and future development projects on schedule and on budget; the demand for office space in markets in which Kilroy Realty has a presence; and risks detailed from time to time in the company's Securities and Exchange Commission reports, including quarterly reports on Form 10-Q, current reports on Form 8-K and annual reports on Form 10-K. Many of these factors are beyond Kilroy Realty's ability to control or predict. Forward-looking statements are not guarantees of performance. For forward-looking statements herein, Kilroy Realty claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. The company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.

Kilroy Realty Corporation, a member of the S&P Small Cap 600 Index, is a Southern California-based real estate investment trust active in the office and industrial property sectors. For over 60 years, the company has owned, developed, acquired and managed real estate assets primarily in the coastal regions of Los Angeles, Orange and San Diego counties. At March 31, 2009, the company owned 8.6 million rentable square feet of commercial office space and 3.7 million rentable square feet of industrial space.

Source: Kilroy Realty Corporation

Kilroy Realty Corporation
Richard E. Moran Jr.
Executive Vice President and Chief Financial Officer
Tyler H. Rose
Senior Vice President and Treasurer