Continues its development pace with plans to break ground on
another 336,000 square feet by the end of 2001
SAN DIEGO - Kilroy Realty Corporation (NYSE:KRC), one of the region's most active developers and owners of office campuses, has passed a major milestone -development of one million square feet of office space in San Diego since 1999, 99 percent of which is leased and occupied. The company is continuing its record-breaking pace with more than 335,000 square feet of construction in the pipeline for the remainder of 2001.
"North San Diego is rated first in the nation for investment opportunities because of consistently low vacancy rates and continued strong market absorption by a broad base of dominant industries - life sciences, technology, finance, software, legal and tourism," said Steve Scott, senior vice president of Kilroy Realty. "Kilroy's land portfolio and financial capacity are a solid foundation for new construction, and the company will continue to focus on corporate build-to-suits, mostly for topflight multinational companies."
In the next three months, Kilroy plans to break ground on:
· a 60,000-square-foot Phase II for Diversa Corporation, a global leader
in biotechnology, in Sorrento Mesa;
· a 68,400-square-foot campus style building in Sorrento Mesa;
· and a 90,000-square-foot Phase II in Del Mar for Brobeck, Phleger &
Harrison, LLP, a nationally recognized law firm based in San Diego.
A leading owner/operator and developer of R&D and office space for a diverse range of innovative companies with solid resources that have remained dominant in the marketplace, Kilroy Realty has completed build-to-suit facilities in San Diego for Peregrine Systems, Applied Micro Circuits Corp., Ericsson, Epicor Software and NeoPoint. The company owns and manages more than 2.5 million square feet, which is 100 percent occupied, in San Diego alone, located in the most sought after sub-markets of Sorrento Mesa, University Town Center, Del Mar and Carmel Mountain Ranch.
Phase I of Diversa Corporation's headquarters, a 75,000-square-foot facility consisting of two stories of office and laboratory space, opened in the fourth quarter of 2000. Phase II is comprised of 60,000 square feet of office and laboratory space and is scheduled for completion in the first quarter of 2002.
The first building of the Brobeck, Phleger & Harrison, LLP project is a three-story, 72,300 square foot office structure that was built to accommodate employees with ample space and state-of-the-art services. As the firm's practice has grown, it committed to Phase II, a four-story office building with surface and subterranean parking, scheduled to open in the summer of 2002.
Kilroy Realty also has begun construction on a 68,400-square-foot structure in Pacific Corporate Center in Sorrento Mesa. Mature landscaping and an attractive design with glass, slate and granite finishes give a professional appearance to the high-profile office project. The two-story building can accommodate single or multiple users, and features a flexible and efficient layout that maximizes tenants' space.
"We have experienced enormous success with our past developments at Pacific Corporate Center given its desirable location and continuous growth rate, with well-established companies relocating into the area," said Stephen Stock, vice president of Kilroy and project manager for Pacific Corporate Center.
In July 1999 Peregrine Systems committed to Kilroy's 420,000-square-foot Del Mar office campus as its new world headquarters, leasing four buildings with an option for a fifth. The transaction was the largest office lease in San Diego history. To accommodate Peregrine's continued solid growth, Kilroy has begun design on the fifth building, totaling 118,000 square feet, and anticipates groundbreaking by the end of 2001. This structure, as well as the other four, is equipped with a fiber optics cable system for high-speed Internet access for voice, video, data and multimedia communications. Upon completion the Peregrine campus will encompass nearly 550,000 square feet with on-site parking for 2,400 employees, a full-service fitness facility and a food court, making it San Diego's premier corporate campus, from location and amenities to its efficient, flexible and attractive design.
Kilroy Realty Corporation is a real estate investment trust that focuses on the commercial office and industrial property sectors in the coastal corridor of Southern California. The company has a current development pipeline of approximately $500 million. At March 30, 2001, Kilroy Realty owned 7.0 million square feet of commercial office space and 5.8 million square feet of industrial space. More information can be found at www.kilroyrealty.com.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release regarding Kilroy Realty Corp.'s business which are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" in the Company's Annual Report or Form 10-K for the most recently ended fiscal year.
Kilroy Realty Corporation, Los Angeles