Largest Single Office Lease Ever Executed in San Francisco
LOS ANGELES--(BUSINESS WIRE)--
Kilroy Realty Corporation(NYSE: KRC) today announced that
Dropbox, a leading global collaboration platform, has signed a 15-year
lease for 100% of the office space at The Exchange on 16th.
The four-building, 750,000 square-foot development by KRC consists of
736,000 square feet of creative office space and 14,000 square feet of
retail space. The project is currently under construction in the Mission
Bay neighborhood of San Francisco.
Under the terms of the lease, which is the largest single Class A
commercial transaction ever completed in San Francisco, Dropbox will
take possession in three phases beginning in the fourth quarter of 2018
through the fourth quarter of 2019. KRC's $570 million office project is
a prime example of the creative, collaborative and regionally-rooted
design the company has become known for. Designed by Rios Clementi Hale
Studios, a multidisciplinary design firm based in Los Angeles, The
Exchange’s four buildings take cues from the surrounding environment
with buildings that are interconnected yet distinct, and materials that
bridge the area’s rich history. At the street level, The Exchange
creates a fluid outdoor village with deep courtyards, bike plazas, and
gardens activated by retail and amenities. The LEED-Platinum design
features vast, light-filled open office space that comes to life through
framed views, glimpses of adjacent buildings, and rooftop gardens with
remarkable views of San Francisco Bay and the City.
“We’re delighted to have Dropbox as our tenant at The Exchange,” said
John Kilroy, the company’s Chairman and Chief Executive Officer. “This
dynamic organization and their highly skilled workforce inspires us and
our design as we look to the future and anticipate the needs of today’s
creative workforce. Dropbox’s expansion at The Exchange is an excellent
example of the entrepreneurship and innovation that drives San
Francisco’s economy and has made the City one of the strongest
commercial real estate markets in the world.”
“We’re excited to partner with Kilroy to create a new home for our
growing team. The Exchange is a space that will reflect our creative
culture and inspire us to continue building great products for our
users,” said Drew Houston, Co-Founder and Chief Executive Officer,
Dropbox.
The Exchange on 16th is located in Mission Bay, a vibrant
neighborhood that has rapidly emerged as one of the most coveted in the
City, admired for its interesting mix of residential and retail
amenities. Its location, along the 16th Street Corridor
adjacent to the 280 Freeway and near Muni’s T–Line, makes it highly
accessible and convenient to adjoining residential neighborhoods,
including Potrero Hill, the Mission District and Dogpatch. The Exchange
is also within walking distance of the San Francisco Giants and new
Golden State Warriors stadium along with other world-class entertainment.
About Kilroy Realty Corporation. Kilroy Realty Corporation
(KRC), a publicly traded real estate investment trust and member of the
S&P MidCap 400 Index, is one of the West Coast’s premier landlords. The
company has over 70 years of experience developing, acquiring and
managing office and mixed-use real estate assets. The company provides
physical work environments that foster creativity and productivity and
serves a broad roster of dynamic, innovation-driven tenants, including
technology, entertainment, digital media and health care companies.
At June 30, 2017, the company’s stabilized portfolio totaled
approximately 14.4 million square feet of office space and 200
residential units located in the coastal regions of Los Angeles, Orange
County, San Diego, the San Francisco Bay Area and Greater Seattle. In
addition, KRC had four projects totaling approximately 1.8 million
square feet of office space, 237 residential units and 96,000 square
feet of retail space under construction.
The company has been recognized by GRESB as the North American leader in
office sustainability for the last four years and is listed in the Dow
Jones Sustainability World Index. At the end of the second quarter, the
company’s stabilized portfolio was 52% LEED certified and 71% of
eligible properties were ENERGY STAR certified. More information is
available at http://www.kilroyrealty.com.
Forward-Looking Statements. This press release contains
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended. Forward-looking statements are based
on our current expectations, beliefs and assumptions, and are not
guarantees of future performance. Forward-looking statements are
inherently subject to uncertainties, risks, changes in circumstances,
trends and factors that are difficult to predict, many of which are
outside of our control. Accordingly, actual performance, results and
events may vary materially from those indicated in the forward-looking
statements, and you should not rely on the forward-looking statements as
predictions of future performance, results or events. Numerous factors
could cause actual future performance, results and events to differ
materially from those indicated in the forward-looking statements,
including, among others: global market and general economic conditions
and their effect on our liquidity and financial conditions and those of
our tenants; adverse economic or real estate conditions generally, and
specifically, in the States of California and Washington; risks
associated with our investment in real estate assets, which are
illiquid, and with trends in the real estate industry; defaults on or
non-renewal of leases by tenants; any significant downturn in tenants’
businesses; our ability to re-lease property at or above current market
rates; costs to comply with government regulations, including
environmental remediation; the availability of cash for distribution and
debt service and exposure to risk of default under debt obligations;
increases in interest rates and our ability to manage interest rate
exposure; the availability of financing on attractive terms or at all,
which may adversely impact our future interest expense and our ability
to pursue development, redevelopment and acquisition opportunities and
refinance existing debt; a decline in real estate asset valuations,
which may limit our ability to dispose of assets at attractive prices or
obtain or maintain debt financing, and which may result in write offs or
impairment charges; significant competition, which may decrease the
occupancy and rental rates of properties; potential losses that may not
be covered by insurance; the ability to successfully complete
acquisitions and dispositions on announced terms; the ability to
successfully operate acquired, developed and redeveloped properties; the
ability to successfully complete development and redevelopment projects
on schedule and within budgeted amounts; delays or refusals in obtaining
all necessary zoning, land use and other required entitlements,
governmental permits and authorizations for our development and
redevelopment properties; increases in anticipated capital expenditures,
tenant improvement and/or leasing costs; defaults on leases for land on
which some of our properties are located; adverse changes to, or
implementations of, applicable laws, regulations or legislation; risks
associated with joint venture investments, including our lack of sole
decision-making authority, our reliance on co-venturers’ financial
condition and disputes between us and our co-venturers; environmental
uncertainties and risks related to natural disasters; and our ability to
maintain our status as a REIT. These factors are not exhaustive and
additional factors could adversely affect our business and financial
performance. For a discussion of additional factors that could
materially adversely affect our business and financial performance, see
the factors included under the caption “Risk Factors” in our annual
report on Form 10-K for the year ended December 31, 2016 and our other
filings with the Securities and Exchange Commission. All forward-looking
statements are based on currently available information, and speak only
as of the date on which they are made. We assume no obligation to update
any forward-looking statement made in this press release that becomes
untrue because of subsequent events, new information or otherwise,
except to the extent we are required to do so in connection with our
ongoing requirements under federal securities laws.
View source version on businesswire.com: http://www.businesswire.com/news/home/20171010006694/en/
Kilroy Realty Corporation
Tyler H. Rose
Executive Vice
President
and Chief Financial Officer
(310) 481-8484
or
Michelle
Ngo
Senior Vice President
and Treasurer
(310) 481-8581
Source: Kilroy Realty Corporation