Kilroy

Where Innovation Works

Press Room Release

Kilroy Realty Corporation Reports First Quarter Financial Results

Printer Friendly Version View printer-friendly version
<< Back
Contact
Contact: FOR RELEASE:
Richard E. Moran Jr Tyler H. Rose
Executive Vice President Senior Vice President
and Chief Financial Officer and Treasurer
(310) 563-5533 (310) 563-5531

LOS ANGELES, May 7, 1997 - Kilroy Realty Corporation (NYSE: KRC) today reported financial results for the two-month period ended March 31, 1997, with funds from operations (FFO) of $5.0 million, or $0.29 per share. Net income for the two-month period totaled $2.7 million, or $0.18 per share, on revenues of $9.0 million. The Southern California-based real estate investment trust completed its initial public offering of common stock on January 31, 1997.

Kilroy also reported that, since its IPO, the company has contracted or entered into letters of intent to purchase 12 office and industrial properties containing more than 1.9 million square feet of rentable space for a total purchase price of $155 million. The properties include five office projects with 600,000 square feet of space and seven industrial projects with 1.3 million square feet of space. Of the total, three properties representing a total investment of $25 million have closed to date. Of the remaining $130 million of acquisitions in process, approximately $81 million are the subject of definitive agreements and $49 million are under letters of intent. Subject to the completion of due diligence, all of the remaining acquisitions are expected to close by the end of June.

"Accelerating job growth and a recovering economy have produced the strongest commercial real estate market in Southern California in more than a decade," said John B. Kilroy, Jr., the company's president and chief executive officer. "With competition for acquisitions an increasing factor in the marketplace, we're capitalizing on our first-hand knowledge of regional submarkets to uncover promising investment opportunities," he said.

In addition to an active acquisitions program, Kilroy is adding to its development pipeline, purchasing two industrial development sites for an aggregate price of $6.5 million, and initiating plans to expand facilities at one of the company's existing industrial projects. The company expects to build more than 500,000 square feet of industrial space at the three locations, with construction on the first project scheduled to begin in the third quarter. "We've made a strong start," said Richard E. Moran Jr., the company's chief financial officer. "Kilroy has produced solid financial results in line with REIT analysts' expectations and we've successfully launched the ambitious growth plan laid out during our IPO - to acquire and develop quality real estate in strong suburban markets of Southern California."

Kilroy Realty Corporation owns, operates and develops commercial and industrial properties, primarily in California. At March 31, 1997, the company owned 2.0 million square feet of commercial office space and 1.3 million square feet of industrial space.

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.

Kilroy Realty Corporation

Summary Quarterly Results

(in thousands, except per share data)

Period from

February 1, 1997 to

March 31, 1997

Revenues

$8,972

Net income available to common sstockholders (1)

$2,652

Average common shares outstanding

14,475

Ner income pershate of common stock

$0.18

Funds from operations

$4,958

Weighted Average shares outstanding (2)

17,127

Funds from opeerations per share (2)

$0.29

March 31, 1997

Occupancy

California

98.40%

Washington (3)

37.30%

Arizona

100.00%


Weighted average total

88.80%

December 31, 1999

California

95.10%

Washington (3)

42.40%

Arizona

100.00%


Weighted average total

87.00%

(1) Net income after minority interest

(2) Calculated based on average shares outstanding assuming conversion of all partnership units outstanding

 

Kilroy Realty Corporation Consolidated Balance Sheet

(unaudited in thousands)

March 31,

1997


ASSETS

RENTAL PROPERTIES

Land

$26,069

Buildings and improvements

259,333


Total rental properties

285,402

Accumulated depreciation and amortization

(111,791)


Rental properties, net

173,612

Cash and cash equivalents

116,163

Restricted cash

4,244

Tenant receivables, net

3,537

Due from affiliates

1,261

Deferred charges and other assets, net

11,565

TOTAL

$310,382



LIABILITIES & STOCKHOLDERS' EQUITY

LIABILITIES

Debt

$95,917

Accounts payable and accrued expenses

4,962

Rents received in advance and tenant security deposits

8,554

Total liabilities

109,433


MINORITY INTEREST

31,127

STOCKHOLDER'S EQUITY

Common stock, $.01 par value, 150,000,000 shares

authorized: 14,475,000 shares issued and outstanding

145

Additional paid-in capital

167,025

Retained (deficit) earnings

2,652


TOTAL LIABILITIES & STOCKHOLDERS' EQUITY

$310,382



 

Kilroy Realt Corporation Consolidated Statement of Operations

(unaudited, in thousands, except per share data)

Period from

February 1, 1997 to

March 31, 1997

REVENUES

Rental income

$7,110

Tenant reimbursements

706

Interest income

971

Other income

185


Total revenues

8,972

EXPENSES

Property expenses

1,239

Real estate taxes

353

General and administrative

725

Ground leases

185

Interest expense

1,531

Depreciation and amortization

1,744


Total expenses

5,777

Income before equity in income of subsidiary

and minority interests

3,195

Equity in income of subsidiary

(57)

Minority interest

(486)


Net income

$2,652

Average shares outstanding

14,475

Income per share of common stock

$0.18



 

Kilroy Realty Corporation

Funds From Operations

(in thousands, except per share data)

Period from

February 1, 1997 to

March 31, 1997

Net income

$2,652

Add

Minority Interest

468

Depreciation and amortization

1,744

Other

77


Funds from operations

$4,959



Average shares outstanding

17,127

Funds from operations per share

$0.29



Kilroy Realty Corporation

Funds Available for Distribution

(in thousands, except per share data)

Period from

February 1, 1997 to

March 31, 1997

Funds from operations

$4,959

Adjustments

Amortization of deferred financing costs

161

Second generation tenant improvements

and leasing commissions

(212)

Net effect of straight-line rents

5


Funds available for distribution

$4,913



 

Funds available for distribution per share

$0.29