Kilroy Realty Corporation Signs Largest Office Lease Agreement In San Diego County History
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LOS ANGELES, July 12 /PRNewswire/ -- Kilroy Realty Corporation (NYSE: KRC) announced that it has signed a lease agreement with Peregrine Systems (Nasdaq: PRGN), a publicly traded enterprise software developer, for four of the five buildings planned for KRC's new commercial office complex in Del Mar. At 420,000 square feet of space, the agreement is the largest single office lease transaction in San Diego County's commercial history.
The agreement includes the delivery of four campus-style office buildings to Peregrine Systems over the next three years, and also provides an option for Peregrine to lease a fifth building. Construction is currently underway on two of the five buildings as well as a 1,730-space parking structure. First occupancies are scheduled for October 1999. Lease terms for the buildings are 11 and 12 years in length and have staggered expirations over a four-year period beginning in 2010.
"Southern California's expanding base of knowledge-driven enterprises is a key factor in the region's robust demand for well-located, well-designed office space," said John B. Kilroy, Jr., KRC's president and chief executive officer. "Creativity is the lifeblood of these organizations, so it's not surprising that they place a high priority on the location, design and amenities provided in a work environment," he added.
Recently renamed Peregrine Systems Corporate Center, KRC's new Del Mar office complex embodies many of the design features in high demand among the technology, telecommunications and bioscience enterprises that populate San Diego County. The key features of the complex include the preeminent Del Mar location at the intersection of Interstate 5 and SR 56; a low-rise, campus-style layout; large, flexible interior floorplates; and attractive, comfortable public areas, including three courtyards, fountains and other water features, and a third-story observation deck with views of the Torrey Pines Reserve.
Peregrine Systems Corporate Center is one of several office projects Kilroy Realty is currently developing in Southern California. The Del Mar site was part of a portfolio of San Diego land and properties that KRC acquired in 1997 from The Allen Group, which retains an interest in the property. Overall, KRC currently has more than $300 million of in-process and committed development projects of which approximately 85% is preleased or otherwise committed.
Some of the information presented in this release is forward-looking in nature. Although the information is based on the company's current best judgment, actual results could vary from expectations stated here. Numerous factors will affect Kilroy's actual results, some of which are beyond the company's control. These include the timing and strength of regional economic growth, the strength of commercial and industrial real estate markets, competitive market conditions, future interest rate levels and capital market conditions. For further information, please see Kilroy's Annual Report on Form 10-K and its Quarterly Reports on Form 10-Q.
Kilroy Realty Corporation is a Southern California-based real estate investment trust active in the commercial office and industrial property sectors. Principal submarkets for the company's development projects include Los Angeles, San Diego, Long Beach and Orange County, where the company has a development pipeline exceeding $500 million. At March 31, 1999, the company owned 5.7 million square feet of commercial office space and 6.2 million square feet of industrial space. More information on Kilroy Realty can be found at www.kilroyrealty.com.
SOURCE Kilroy Realty Corporation