Kilroy Reports Revenues Up in Q3
- Oct 28, 2008
Kilroy Realty Corp has reported financial results for its third quarter ended September 30, 2008 with net income available for common stockholders of $13.2 million, or $0.40 per share, compared to $9.0 million, or $0.28 per share, in the third quarter of 2007. Revenues from continuing operations in the third quarter totaled $77.1 million, up from $65.1 million in the prior year’s third quarter. Funds from operations (FFO) for the period totaled $34.5 million, or $1.00 per share, compared to $28.2 million, or $0.81 per share, in the year-earlier period. For the first nine months of 2008, KRC reported net income available for common stockholders of $28.6 million, or $0.88 per share, compared to $38.6 million, or $1.19 per share, in the first nine months of 2007. Revenues from continuing operations in the nine-month period totaled $217.5 million, up from $188.7 million in the same period of 2007. FFO in the first nine months of 2008 totaled $91.8 million, or $2.64 per share, compared to $80.9 million, or $2.33 per share, in first nine months of 2007. Included in the results for the nine months ended September 30, 2008 is an approximate $4.9 million net lease termination fee related to an early termination agreement the company entered into with Intuit Inc. The lease that was terminated encompassed approximately 90,000 rentable square feet of office space. Intuit had an option to early terminate this lease in 2010 and the lease was scheduled to expire in 2014. Also included in the results for the nine months ended September 30, 2008 is approximately $2.7 million of non-cash rental revenue related to the termination of the company’s lease with Favrille Inc. In July 2008, the company and Favrille entered into an agreement to terminate this lease effective August 31, 2008. The non-cash rental revenue recognized for the quarter primarily represents the unamortized deferred revenue balance related to tenant-funded tenant improvements for this lease at the lease termination date. All per-share amounts in this report are presented on a diluted basis. “KRC reported solid financial results for the third quarter, despite the uncertainty about the direction of the economy and the turmoil in global credit markets,” said John B. Kilroy, Jr., the company’s president and chief executive officer. During the third quarter, KRC added two properties, which are 100 percent leased, to its stabilized portfolio, a newly developed 146,000 square-foot office building located along the I-15 corridor in San Diego County and a newly redeveloped 107,000 square-foot office building in El Segundo. The two properties represent a total estimated new investment of approximately $66 million. KRC has three additional properties currently under development, all located in submarkets of San Diego County. The three properties encompass approximately 254,000 square feet of rentable space and represent a total estimated investment of approximately $111 million, of which $90 million has been spent to date.