Kilroy

Where Innovation Works

Press Room Release

Kilroy Realty Signs 178,000 Square Foot Lease with Accredited Home Lenders for New San Diego Headquarters; Three-Building Campus Located at Innovation Corporate Center in Rancho Bernardo

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LOS ANGELES--(BUSINESS WIRE)--June 15, 2005--Kilroy Realty Corporation (NYSE:KRC) today said it has signed a lease agreement with Accredited Home Lenders (NASDAQ:LEND) for a new three-building corporate headquarters campus totaling 178,000 rentable square feet at Innovation Corporate Center along the I-15 Corridor in the Rancho Bernardo submarket of San Diego.

Accredited Home Lenders has agreed to lease two buildings totaling 103,000 square feet that are currently under construction. The lease term for these two buildings is 10.5 years, commencing in December 2005. Accredited Home Lenders will also lease a third building totaling 75,000 square feet that has an estimated construction commencement date of January 2006. The lease term for this building is 9.5 years, commencing in December 2006.

With the addition of the three new buildings, the master-planned Innovation Corporate Center will include eight buildings totaling approximately 468,000 square feet, all of which are currently fully-leased, and one future development site upon which the company can build approximately 80,000 square feet of additional space.

"This lease continues to demonstrate the strength of the I-15 Corridor in San Diego and its popularity among corporate headquarters tenants," said John B. Kilroy, Jr., KRC's president and chief executive officer. "It is another example of how our development pipeline is generating profitable opportunities for KRC's shareholders," he added.

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. 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; fluctuations in the company's share price and the resulting impact on general and administrative 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 other risks detailed from time to time in the company's SEC 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. 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 more than 50 years, the company has owned, developed, acquired and managed real estate assets primarily in the coastal regions of California and Washington. KRC is currently active in office development and redevelopment in Los Angeles and San Diego counties. At March 31, 2005, the company owned 7.6 million rentable square feet of commercial office space and 4.5 million rentable square feet of industrial space. More information is available at www.kilroyrealty.com.

CONTACT:
Kilroy Realty Corporation
Richard E. Moran Jr., 310-481-8483
Executive Vice President and Chief Financial Officer
or
Tyler H. Rose, 310-481-8484
Senior Vice President and Treasurer

SOURCE:
Kilroy Realty Corporation