Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2013 | Oct. 28, 2013 | |
Entity Registrant Name | KILROY REALTY CORP | |
Entity Central Index Key | 1025996 | |
Current Fiscal Year End Date | -19 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | 30-Sep-13 | |
Document Fiscal Year Focus | 2013 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | FALSE | |
Entity Common Stock, Shares Outstanding | 82,113,491 | |
Kilroy Realty, L.P. [Member] | ||
Entity Registrant Name | Kilroy Realty, L.P. | |
Entity Central Index Key | 1493976 | |
Current Fiscal Year End Date | -19 | |
Entity Filer Category | Non-accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | 30-Sep-13 | |
Document Fiscal Year Focus | 2013 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | FALSE |
Consolidated_Balance_Sheets_Un
Consolidated Balance Sheets (Unaudited) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | ||
In Thousands, unless otherwise specified | ||||
REAL ESTATE ASSETS: | ||||
Land and improvements (Note 2) | $612,843 | $612,714 | ||
Buildings and improvements (Note 2) | 3,527,729 | 3,335,026 | ||
Undeveloped land and construction in progress (Note 2) | 907,959 | 809,654 | ||
Total real estate held for investment | 5,048,531 | 4,757,394 | ||
Accumulated depreciation and amortization | -781,580 | -756,515 | ||
Total real estate assets held for investment, net ($119,262 and $319,770 of VIE, respectively, Note 1) | 4,266,951 | 4,000,879 | ||
REAL ESTATE ASSETS AND OTHER ASSETS HELD FOR SALE, NET (NOTE 12) | 239,411 | 0 | ||
CASH AND CASH EQUIVALENTS | 197,150 | 16,700 | ||
RESTRICTED CASH (Note 1) | 17,931 | 247,544 | ||
MARKETABLE SECURITIES (Note 11) | 9,192 | [1],[2] | 7,435 | [1],[2] |
CURRENT RECEIVABLES, NET (Note 4) | 11,769 | [3] | 9,220 | |
DEFERRED RENT RECEIVABLES, NET (Note 4) | 121,659 | [4] | 115,418 | |
DEFERRED LEASING COSTS AND ACQUISITION-RELATED INTANGIBLE ASSETS, NET (Notes 2 and 3) | 190,085 | 189,968 | ||
DEFERRED FINANCING COSTS, NET | 17,809 | 18,971 | ||
PREPAID EXPENSES AND OTHER ASSETS, NET | 17,319 | 9,949 | ||
TOTAL ASSETS | 5,089,276 | 4,616,084 | ||
LIABILITIES: | ||||
Secured debt (Notes 2, 5 and 11) | 563,898 | [5] | 561,096 | [5] |
Exchangeable senior notes, net (Notes 5 and 11) | 167,236 | 163,944 | ||
Unsecured debt, net (Notes 5 and 11) | 1,431,048 | 1,130,895 | ||
Unsecured line of credit (Notes 5 and 11) | 0 | 185,000 | ||
Accounts payable, accrued expenses and other liabilities | 210,111 | 154,734 | ||
Accrued distributions (Note 15) | 31,479 | 28,924 | ||
Deferred revenue and acquisition-related intangible liabilities, net (Notes 2 and 3) | 102,991 | 117,904 | ||
Rents received in advance and tenant security deposits | 41,668 | 37,654 | ||
Liabilities and deferred revenue of real estate assets held for sale (Note 12) | 16,751 | 0 | ||
Total liabilities | 2,565,182 | 2,380,151 | ||
COMMITMENTS AND CONTINGENCIES (Note 10) | ||||
Preferred stock, $.01 par value, 30,000,000 shares authorized: | ||||
Common stock, $.01 par value, 150,000,000 shares authorized, 82,113,491 and 74,926,981 shares issued and outstanding, respectively | 821 | 749 | ||
Additional paid-in capital | 2,476,424 | 2,126,005 | ||
Distributions in excess of earnings | -201,048 | -129,535 | ||
Total stockholders’ equity | 2,468,608 | 2,189,630 | ||
Noncontrolling interest : | ||||
Common units of the Operating Partnership (Note 6) | 50,601 | 46,303 | ||
Noncontrolling Interest in consolidated subsidiary (Notes 2 and 6) | 4,885 | 0 | ||
Total noncontrolling interests | 55,486 | 46,303 | ||
Total equity | 2,524,094 | 2,235,933 | ||
TOTAL LIABILITIES AND EQUITY / CAPITAL | 5,089,276 | 4,616,084 | ||
Series G Cumulative Redeemable Preferred Stock | ||||
Preferred stock, $.01 par value, 30,000,000 shares authorized: | ||||
Cumulative Redeemable Preferred stock | 96,155 | 96,155 | ||
Series H Cumulative Redeemable Preferred Stock | ||||
Preferred stock, $.01 par value, 30,000,000 shares authorized: | ||||
Cumulative Redeemable Preferred stock | $96,256 | $96,256 | ||
[1] | Based on quoted prices in active markets for identical securities. | |||
[2] | The marketable securities are held in a limited rabbi trust. | |||
[3] | Excludes current receivables, net related to properties held for sale at September 30, 2013. | |||
[4] | Excludes deferred rent receivables, net related to properties held for sale at September 30, 2013. | |||
[5] | Amounts reported include the amounts of unamortized debt premiums and discounts for the periods presented. |
Consolidated_Balance_Sheets_Un1
Consolidated Balance Sheets (Unaudited) (Parenthetical) (USD $) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2013 | Dec. 31, 2012 | |
Variable Interest Entity, Consolidated, Carrying Amount, Assets | $135,300,000 | $337,000,000 |
Common stock, par value | $0.01 | |
Common Stock [Member] | ||
Common stock, par value | $0.01 | $0.01 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 82,113,491 | 74,926,981 |
Common stock, shares outstanding | 82,113,491 | 74,926,981 |
Preferred Stock [Member] | ||
Preferred stock, par value | $0.01 | $0.01 |
Preferred stock, shares authorized | 30,000,000 | 30,000,000 |
Series G Cumulative Redeemable Preferred Stock | ||
Preferred stock, par value | $0.01 | $0.01 |
Preferred stock dividend rate percentage | 6.88% | 6.88% |
Preferred stock, shares authorized | 4,600,000 | 4,600,000 |
Preferred stock, shares issued | 4,000,000 | 4,000,000 |
Preferred stock, shares outstanding | 4,000,000 | 4,000,000 |
Preferred Stock Liquidation preference | 100,000,000 | 100,000,000 |
Series H Cumulative Redeemable Preferred Stock | ||
Preferred stock, par value | $0.01 | $0.01 |
Preferred stock dividend rate percentage | 6.38% | 6.38% |
Preferred stock, shares authorized | 4,000,000 | 4,000,000 |
Preferred stock, shares issued | 4,000,000 | 4,000,000 |
Preferred stock, shares outstanding | 4,000,000 | 4,000,000 |
Preferred Stock Liquidation preference | 100,000,000 | 100,000,000 |
Real Estate Investment [Member] | ||
Variable Interest Entity, Consolidated, Carrying Amount, Assets | 119,262,000 | 319,770,000 |
Kilroy Realty, L.P. [Member] | ||
Variable Interest Entity, Consolidated, Carrying Amount, Assets | $119,262,000 | $319,770,000 |
Consolidated_Statements_of_Equ
Consolidated Statements of Equity (Unaudited) (USD $) | Total | Total Stockholders' Equity | Preferred Stock [Member] | Common Stock [Member] | Common Stock Additional Paid-in Capital | Common Stock Distributions in Excess of Earnings | Noncontrolling Interests - Common Units of the Operating Partnership | Series A Preferred Units [Member] | Series A Preferred Units [Member] | Series A Preferred Units [Member] |
In Thousands, except Share data, unless otherwise specified | Total Stockholders' Equity | Common Stock Distributions in Excess of Earnings | ||||||||
Beginning Balance at Dec. 31, 2011 | $1,327,482 | $1,293,717 | $121,582 | $588 | $1,448,997 | ($277,450) | $33,765 | |||
Beginning Balance, shares at Dec. 31, 2011 | 58,819,717 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income | 83,471 | 81,763 | 81,763 | 1,708 | ||||||
Issuance of Series G and Series H Preferred stock | 192,411 | 192,411 | 192,411 | |||||||
Redemption of Series E and Series F Preferred stock, shares | -121,582 | |||||||||
Redemption of Preferred stock and units | -126,500 | -126,500 | -4,918 | -2,062 | -2,062 | -2,062 | ||||
Issuance of common stock, shares | 15,813,189 | |||||||||
Issuance of common stock | 662,371 | 662,371 | 159 | 662,212 | ||||||
Issuance of share-based compensation awards, shares | 62,137 | |||||||||
Issuance of share-based compensation awards | 957 | 957 | 957 | |||||||
Noncash amortization of share-based compensation | 6,182 | 6,182 | 6,182 | |||||||
Repurchase of common stock and restricted stock units, shares | -22,312 | |||||||||
Repurchase of common stock and restricted stock units | -603 | -603 | -603 | |||||||
Settlement of restricted stock units for common stock, shares | 5,208 | |||||||||
Settlement of restricted stock units for common stock value | -133 | -133 | -133 | |||||||
Exercise of stock options, net, units | 5,000 | |||||||||
Exercise of stock options, net | 129 | 129 | 129 | |||||||
Issuance of common units | 5,604 | 5,604 | ||||||||
Exchange of common units of the Operating Parternship, shares | 10,000 | |||||||||
Exchange of common units of the Operating Partnership | 0 | 231 | 231 | -231 | ||||||
Adjustment for noncontrolling interest | 0 | -3,198 | -3,198 | 3,198 | ||||||
Preferred dividends and distributions | -10,795 | -10,795 | -10,795 | |||||||
Dividends declared per common share and common unit ($1.05 per share/unit) | -77,146 | -75,303 | -75,303 | -1,843 | ||||||
Ending Balance at Sep. 30, 2012 | 2,061,368 | 2,019,167 | 192,411 | 747 | 2,114,774 | -288,765 | 42,201 | |||
Ending Balance, shares at Sep. 30, 2012 | 74,692,939 | |||||||||
Beginning Balance at Dec. 31, 2012 | 2,235,933 | 2,189,630 | 192,411 | 749 | 2,126,005 | -129,535 | 46,303 | |||
Beginning Balance, shares at Dec. 31, 2012 | 74,926,981 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income | 21,518 | 21,252 | 21,252 | 266 | ||||||
Issuance of common stock, shares | 7,215,838 | |||||||||
Issuance of common stock | 349,951 | 349,951 | 72 | 349,879 | ||||||
Issuance of share-based compensation awards, shares | 0 | |||||||||
Issuance of share-based compensation awards | 1,075 | 1,075 | 1,075 | |||||||
Noncash amortization of share-based compensation | 7,096 | 7,096 | 7,096 | |||||||
Repurchase of common stock and restricted stock units, shares | -34,164 | |||||||||
Repurchase of common stock and restricted stock units | -1,803 | -1,803 | -1,803 | |||||||
Settlement of restricted stock units for common stock, shares | 4,363 | |||||||||
Settlement of restricted stock units for common stock value | -10 | -10 | -10 | |||||||
Exercise of stock options, net, units | 473 | |||||||||
Exercise of stock options, net | 128 | 128 | 128 | |||||||
Issuance of common units | 4,885 | 4,885 | ||||||||
Adjustment for noncontrolling interest | 0 | -5,946 | -5,946 | 5,946 | ||||||
Preferred dividends and distributions | -9,938 | -9,938 | -9,938 | |||||||
Dividends declared per common share and common unit ($1.05 per share/unit) | -84,741 | -82,827 | -82,827 | -1,914 | ||||||
Ending Balance at Sep. 30, 2013 | $2,524,094 | $2,468,608 | $192,411 | $821 | $2,476,424 | ($201,048) | $55,486 | |||
Ending Balance, shares at Sep. 30, 2013 | 82,113,491 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (Unaudited) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
REVENUES: | ||||
Rental income | $104,939 | $90,828 | $308,931 | $253,599 |
Tenant reimbursements | 9,656 | 8,022 | 28,503 | 21,867 |
Other property income (Note 10) | 1,102 | 135 | 7,062 | 961 |
Total revenues | 115,697 | 98,985 | 344,496 | 276,427 |
EXPENSES: | ||||
Property expenses | 25,123 | 21,016 | 71,728 | 55,531 |
Real estate taxes | 10,295 | 8,746 | 29,707 | 23,668 |
Provision for bad debts | 124 | 0 | 219 | 2 |
Ground leases | 929 | 859 | 2,665 | 2,276 |
General and administrative expenses | 10,226 | 8,727 | 29,750 | 26,745 |
Acquisition-related expenses | 568 | 556 | 1,387 | 3,897 |
Depreciation and amortization | 47,569 | 41,724 | 141,814 | 109,780 |
Total expenses | 94,834 | 81,628 | 277,270 | 221,899 |
OTHER (EXPENSES) INCOME: | ||||
Interest income and other net investment gains (Note 11) | 673 | 330 | 1,084 | 703 |
Interest expense (Note 5) | -18,853 | -19,854 | -58,021 | -60,172 |
Total other (expenses) income | -18,180 | -19,524 | -56,937 | -59,469 |
INCOME (LOSS) FROM CONTINUING OPERATIONS | 2,683 | -2,167 | 10,289 | -4,941 |
DISCONTINUED OPERATIONS (NOTE 12) | ||||
Income from discontinued operations (Note 10) | 6,344 | 4,689 | 10,806 | 15,603 |
Net gain on dispositions of discontinued operations | 0 | 0 | 423 | 72,809 |
Total income from discontinued operations | 6,344 | 4,689 | 11,229 | 88,412 |
NET INCOME | 9,027 | 2,522 | 21,518 | 83,471 |
Net (income) loss attributable to noncontrolling common units of the Operating Partnership | -131 | 67 | -266 | -1,708 |
NET INCOME ATTRIBUTABLE TO KILROY REALTY CORPORATION | 8,896 | 2,589 | 21,252 | 81,763 |
PREFERRED DISTRIBUTIONS AND DIVIDENDS: | ||||
Distributions to noncontrolling cumulative redeemable preferred units of the Operating Partnership | 0 | -747 | 0 | -3,541 |
Preferred dividends | -3,312 | -2,533 | -9,938 | -7,254 |
Original issuance costs of redeemed preferred stock and preferred units | 0 | -2,062 | 0 | -6,980 |
Total preferred distributions and dividends | -3,312 | -5,342 | -9,938 | -17,775 |
NET INCOME (LOSS) AVAILABLE TO COMMON STOCKHOLDERS | $5,584 | ($2,753) | $11,314 | $63,988 |
Loss from continuing operations available to common stockholders per common share - basic (Note 13) | ($0.01) | ($0.10) | ($0.01) | ($0.34) |
Loss from continuing operations available to common stockholders per common share - diluted (Note 13) | ($0.01) | ($0.10) | ($0.01) | ($0.34) |
Net income (loss) available to common stockholders per share - basic (Note 13) | $0.07 | ($0.04) | $0.13 | $0.92 |
Net income (loss) available to common stockholders per share - diluted (Note 13) | $0.07 | ($0.04) | $0.13 | $0.92 |
Weighted average common shares outstanding - basic (Note 13) | 76,768,893 | 71,889,475 | 75,750,822 | 67,975,309 |
Weighted average common shares outstanding - diluted (Note 13) | 76,768,893 | 71,889,475 | 75,750,822 | 67,975,309 |
Dividends declared per common share | $0.35 | $0.35 | $1.05 | $1.05 |
Consolidated_Statements_of_Equ1
Consolidated Statements of Equity (Unaudited) (Parenthetical) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Statement of Stockholders' Equity [Abstract] | ||||
Dividends declared per common share | $0.35 | $0.35 | $1.05 | $1.05 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (Unaudited) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $21,518 | $83,471 |
Adjustments to reconcile net income to net cash provided by operating activities (including discontinued operations): | ||
Depreciation and amortization of building and improvements and leasing costs | 148,982 | 122,754 |
Increase (decrease) in provision for bad debts | 196 | -192 |
Depreciation of furniture, fixtures and equipment | 1,363 | 896 |
Noncash amortization of share-based compensation awards | 6,454 | 5,544 |
Noncash amortization of deferred financing costs and debt discounts and premiums | 4,047 | 7,078 |
Noncash amortization of net below market rents (Note 3) | -6,015 | -4,616 |
Net gain on dispositions of discontinued operations (Note 12) | -423 | -72,809 |
Noncash amortization of deferred revenue related to tenant-funded tenant improvements | -7,585 | -6,851 |
Straight-line rents | -18,188 | -16,433 |
Net change in other operating assets | -6,435 | -2,529 |
Net change in other operating liabilities | 42,844 | 31,965 |
Insurance proceeds received for property damage | -448 | -951 |
Net cash provided by operating activities | 186,310 | 147,327 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Expenditures for acquisition of operating properties (Note 2) | -202,682 | -393,133 |
Expenditures for acquistion of development and redevelopment properties (Note 2) | 13,269 | 163,271 |
Expenditures for operating properties | 83,991 | 60,967 |
Expenditures for development and redevelopment properties and undeveloped land | -222,192 | -52,937 |
Net proceeds received from dispositions of operating properties | 14,409 | 141,810 |
Insurance proceeds received for property damage | 448 | 951 |
Increase in acquisition-related deposits | -4,000 | -8,250 |
Decrease (increase) in restricted cash (Note 1) | 229,613 | -5,526 |
Net cash used in investing activities | -281,664 | -541,323 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Net proceeds from issuance of common stock (Note 7) | 349,951 | 662,371 |
Net proceeds from issuance of Series G and Series H preferred stock | 0 | 192,411 |
Borrowings on unsecured line of credit | 10,000 | 418,000 |
Repayments on unsecured line of credit | -195,000 | -573,000 |
Proceeds from issuance of secured debt | 0 | 97,000 |
Principal payments on secured debt | -91,298 | -104,578 |
Proceeds from the issuance of unsecured debt (Note 5) | 299,901 | 150,000 |
Repayments of exchangeable senior notes | 0 | -148,000 |
Financing costs | -3,975 | -5,396 |
Repurchase of common stock and restricted stock units (Note 9) | -1,813 | -736 |
Proceeds from exercise of stock options | 128 | 129 |
Dividends and distributions paid to common stockholders and common unitholders | -82,152 | -70,517 |
Dividends and distributions paid to preferred stockholders and preferred unitholders | -9,938 | -10,852 |
Net cash provided by financing activities | 275,804 | 405,332 |
Net increase in cash and cash equivalents | 180,450 | 11,336 |
Cash and cash equivalents, beginning of period | 16,700 | 4,777 |
Cash and cash equivalents, end of period | 197,150 | 16,113 |
SUPPLEMENTAL CASH FLOWS INFORMATION: | ||
Cash paid for interest, net of capitalized interest of $23,573 and $11,531 as of September 30, 2013 and 2012, respectively | 47,107 | 49,378 |
NONCASH INVESTING TRANSACTIONS: | ||
Accrual for expenditures for operating properties and development and redevelopment properties | 79,866 | 8,299 |
Tenant improvements funded directly by tenants | 5,750 | 16,303 |
Assumption of secured debt in connection with property acquisitions (Notes 2 and 5) | 95,496 | 177,678 |
Assumption of other assets and liabilities in connection with operating and development property acquisitions, net (Note 2) | 422 | 11,667 |
Contribution of land, net of related liabilities, by noncontrolling interest to consolidated subsidiary (Note 2) | 4,885 | 0 |
NONCASH FINANCING TRANSACTIONS: | ||
Accrual of dividends and distributions payable to common stockholders and common unitholders | 29,378 | 26,782 |
Accrual of dividends and distributions payable to preferred stockholders and preferred unitholders | 1,692 | 1,693 |
Grant date fair value of share-based compensation awards (Note 9) | 10,347 | 30,929 |
Issuance of common units in the Operating Partnership in connection with an operating property acquisition | 4,885 | 5,604 |
Exchange of common units of the Operating Partnership into shares of the Company's common stock | 0 | 231 |
Series A Preferred Units [Member] | ||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Payments for Repurchase of Redeemable Preferred Stock | 0 | 75,000 |
Series E and Series F Cumulative Redeemable Preferred Stock [Member] | ||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Payments for Repurchase of Redeemable Preferred Stock | 0 | -126,500 |
6255 Sunset Boulevard, Los Angeles, CA [Member] | ||
NONCASH FINANCING TRANSACTIONS: | ||
Issuance of common units in the Operating Partnership in connection with an operating property acquisition | $0 | $5,604 |
Consolidated_Statements_of_Cas1
Consolidated Statements of Cash Flows (Unaudited) (Parenthetical) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Statement of Cash Flows [Abstract] | ||
Interest Paid, Capitalized | $23,573 | $11,531 |
Consolidated_Balance_Sheets_KI
Consolidated Balance Sheets (KILROY REALTY, L.P.) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | ||
In Thousands, unless otherwise specified | ||||
REAL ESTATE ASSETS: | ||||
Buildings and improvements (Note 2) | $3,527,729 | $3,335,026 | ||
Undeveloped land and construction in progress (Note 2) | 907,959 | 809,654 | ||
Total real estate held for investment | 5,048,531 | 4,757,394 | ||
Accumulated depreciation and amortization | -781,580 | -756,515 | ||
Total real estate assets held for investment, net ($119,262 and $319,770 of VIE, respectively, Note 1) | 4,266,951 | 4,000,879 | ||
REAL ESTATE ASSETS AND OTHER ASSETS HELD FOR SALE, NET (NOTE 12) | 239,411 | 0 | ||
CASH AND CASH EQUIVALENTS | 197,150 | 16,700 | ||
RESTRICTED CASH (Note 1) | 17,931 | 247,544 | ||
MARKETABLE SECURITIES (Note 11) | 9,192 | [1],[2] | 7,435 | [1],[2] |
CURRENT RECEIVABLES, NET (Note 4) | 11,769 | [3] | 9,220 | |
DEFERRED RENT RECEIVABLES, NET (Note 4) | 121,659 | [4] | 115,418 | |
DEFERRED LEASING COSTS AND ACQUISITION-RELATED INTANGIBLE ASSETS, NET (Notes 2 and 3) | 190,085 | 189,968 | ||
DEFERRED FINANCING COSTS, NET | 17,809 | 18,971 | ||
PREPAID EXPENSES AND OTHER ASSETS, NET | 17,319 | 9,949 | ||
TOTAL ASSETS | 5,089,276 | 4,616,084 | ||
LIABILITIES: | ||||
Secured debt (Notes 2, 5 and 11) | 563,898 | [5] | 561,096 | [5] |
Exchangeable senior notes, net (Notes 5 and 11) | 167,236 | 163,944 | ||
Unsecured debt, net (Notes 5 and 11) | 1,431,048 | 1,130,895 | ||
Unsecured line of credit (Notes 5 and 11) | 0 | 185,000 | ||
Accounts payable, accrued expenses and other liabilities | 210,111 | 154,734 | ||
Accrued distributions (Note 15) | 31,479 | 28,924 | ||
Deferred revenue and acquisition-related intangible liabilities, net (Notes 2 and 3) | 102,991 | 117,904 | ||
Liabilities and deferred revenue of real estate assets held for sale (Note 12) | 16,751 | 0 | ||
Total liabilities | 2,565,182 | 2,380,151 | ||
COMMITMENTS AND CONTINGENCIES (Note 10) | ||||
Partners' Capital (Note 8): | ||||
TOTAL LIABILITIES AND EQUITY / CAPITAL | 5,089,276 | 4,616,084 | ||
Kilroy Realty, L.P. [Member] | ||||
REAL ESTATE ASSETS: | ||||
Land and improvements (Note 2) | 612,843 | 612,714 | ||
Buildings and improvements (Note 2) | 3,527,729 | 3,335,026 | ||
Undeveloped land and construction in progress (Note 2) | 907,959 | 809,654 | ||
Total real estate held for investment | 5,048,531 | 4,757,394 | ||
Accumulated depreciation and amortization | 781,580 | -756,515 | ||
Total real estate assets held for investment, net ($119,262 and $319,770 of VIE, respectively, Note 1) | 4,266,951 | 4,000,879 | ||
CASH AND CASH EQUIVALENTS | 197,150 | 16,700 | ||
RESTRICTED CASH (Note 1) | 17,931 | 247,544 | ||
MARKETABLE SECURITIES (Note 11) | 9,192 | 7,435 | ||
CURRENT RECEIVABLES, NET (Note 4) | 11,769 | 9,220 | ||
DEFERRED RENT RECEIVABLES, NET (Note 4) | 121,659 | 115,418 | ||
DEFERRED LEASING COSTS AND ACQUISITION-RELATED INTANGIBLE ASSETS, NET (Notes 2 and 3) | 190,085 | 189,968 | ||
DEFERRED FINANCING COSTS, NET | 17,809 | 18,971 | ||
PREPAID EXPENSES AND OTHER ASSETS, NET | 17,319 | 9,949 | ||
TOTAL ASSETS | 5,089,276 | 4,616,084 | ||
LIABILITIES: | ||||
Secured debt (Notes 2, 5 and 11) | 563,898 | 561,096 | ||
Exchangeable senior notes, net (Notes 5 and 11) | 167,236 | 163,944 | ||
Unsecured debt, net (Notes 5 and 11) | 1,431,048 | 1,130,895 | ||
Unsecured line of credit (Notes 5 and 11) | 0 | 185,000 | ||
Accounts payable, accrued expenses and other liabilities | 210,111 | 154,734 | ||
Accrued distributions (Note 15) | 31,479 | 28,924 | ||
Deferred revenue and acquisition-related intangible liabilities, net (Notes 2 and 3) | 102,991 | 117,904 | ||
Rents received in advance and tenant security deposits | 41,668 | 37,654 | ||
Total liabilities | 2,565,182 | 2,380,151 | ||
Partners' Capital (Note 8): | ||||
Common units, 82,113,491 and 74,926,981 held by the general partner and 1,821,503 and 1,826,503 held by common limited partners issued and outstanding, respectively | 2,323,341 | 2,040,243 | ||
Total partners' capital | 2,515,752 | 2,232,654 | ||
Noncontrolling interest in consolidated subsidiaries (Notes 2 and 6) | 8,342 | 3,279 | ||
Total capital | 2,524,094 | 2,235,933 | ||
TOTAL LIABILITIES AND EQUITY / CAPITAL | 5,089,276 | 4,616,084 | ||
Series G Cumulative Redeemable Preferred Unit [Member] | Kilroy Realty, L.P. [Member] | ||||
Partners' Capital (Note 8): | ||||
Redeemable Preferred stock | 96,155 | 96,155 | ||
Series H Cumulative Redeemable Preferred Unit [Member] | Kilroy Realty, L.P. [Member] | ||||
Partners' Capital (Note 8): | ||||
Redeemable Preferred stock | $96,256 | $96,256 | ||
[1] | Based on quoted prices in active markets for identical securities. | |||
[2] | The marketable securities are held in a limited rabbi trust. | |||
[3] | Excludes current receivables, net related to properties held for sale at September 30, 2013. | |||
[4] | Excludes deferred rent receivables, net related to properties held for sale at September 30, 2013. | |||
[5] | Amounts reported include the amounts of unamortized debt premiums and discounts for the periods presented. |
Consolidated_Balance_Sheets_KI1
Consolidated Balance Sheets (KILROY REALTY, L.P.) (Parenthetical) (Kilroy Realty, L.P. [Member], USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 |
Common Units [Member] | Common Units [Member] | Series G Cumulative Redeemable Preferred Unit [Member] | Series G Cumulative Redeemable Preferred Unit [Member] | Series H Cumulative Redeemable Preferred Unit [Member] | Series H Cumulative Redeemable Preferred Unit [Member] | |
Preferred Units, Issued | 4,000,000 | 4,000,000 | 4,000,000 | 4,000,000 | ||
Preferred Units, Outstanding | 4,000,000 | 4,000,000 | 4,000,000 | 4,000,000 | ||
Preferred stock dividend rate percentage | 6.88% | 6.88% | 6.38% | 6.38% | ||
Preferred Stock Liquidation preference | $100,000,000 | $100,000,000 | $100,000,000 | $100,000,000 | ||
General partner, units issued | 82,113,491 | 74,926,981 | ||||
General partners, units outstanding | 82,113,491 | 74,926,981 | ||||
Limited partners, units issued | 1,821,503 | 1,826,503 | ||||
Common units held by limited partners | 1,821,503 | 1,826,503 |
Consolidated_Statements_of_Ope1
Consolidated Statements of Operations (KILROY REALTY, L.P.) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
REVENUES: | ||||
Rental income | $104,939 | $90,828 | $308,931 | $253,599 |
Tenant reimbursements | 9,656 | 8,022 | 28,503 | 21,867 |
Other property income (Note 10) | 1,102 | 135 | 7,062 | 961 |
Total revenues | 115,697 | 98,985 | 344,496 | 276,427 |
EXPENSES: | ||||
Property expenses | 25,123 | 21,016 | 71,728 | 55,531 |
Real estate taxes | 10,295 | 8,746 | 29,707 | 23,668 |
Provision for bad debts | 124 | 0 | 219 | 2 |
Ground leases | 929 | 859 | 2,665 | 2,276 |
General and administrative expenses | 10,226 | 8,727 | 29,750 | 26,745 |
Acquisition-related expenses | 568 | 556 | 1,387 | 3,897 |
Depreciation and amortization | 47,569 | 41,724 | 141,814 | 109,780 |
Total expenses | 94,834 | 81,628 | 277,270 | 221,899 |
OTHER (EXPENSES) INCOME: | ||||
Interest income and other net investment gains (Note 11) | 673 | 330 | 1,084 | 703 |
Interest expense (Note 5) | -18,853 | -19,854 | -58,021 | -60,172 |
Total other (expenses) income | -18,180 | -19,524 | -56,937 | -59,469 |
INCOME (LOSS) FROM CONTINUING OPERATIONS | 2,683 | -2,167 | 10,289 | -4,941 |
DISCONTINUED OPERATIONS (NOTE 12) | ||||
Income from discontinued operations (Note 10) | 6,344 | 4,689 | 10,806 | 15,603 |
Net gain on dispositions of discontinued operations | 0 | 0 | 423 | 72,809 |
Total income from discontinued operations | 6,344 | 4,689 | 11,229 | 88,412 |
NET INCOME | 9,027 | 2,522 | 21,518 | 83,471 |
NET INCOME ATTRIBUTABLE TO KILROY REALTY CORPORATION | 8,896 | 2,589 | 21,252 | 81,763 |
Preferred distributions | -9,938 | -10,795 | ||
Original issuance costs of redeemed preferred units | 0 | -2,062 | 0 | -6,980 |
Total preferred distributions | 3,312 | 5,342 | 9,938 | 17,775 |
NET INCOME (LOSS) AVAILABLE TO COMMON STOCKHOLDERS | 5,584 | -2,753 | 11,314 | 63,988 |
Loss from continuing operations available to common unitholders per common unit-basic (Note 14) | ($0.01) | ($0.10) | ($0.01) | ($0.34) |
Loss from continuing operations available to common unitholders per common unit-diluted (Note 14) | ($0.01) | ($0.10) | ($0.01) | ($0.34) |
Net income (loss) available to common unitholders per unit-basic (Note 14) | $0.07 | ($0.04) | $0.13 | $0.92 |
Net income (loss) available to common unitholders per unit-diluted (Note 14) | $0.07 | ($0.04) | $0.13 | $0.92 |
Weighted average common units outstanding - basic (Note 14) | 76,768,893 | 71,889,475 | 75,750,822 | 67,975,309 |
Weighted average common units outstanding - diluted (Note 14) | 76,768,893 | 71,889,475 | 75,750,822 | 67,975,309 |
Kilroy Realty, L.P. [Member] | ||||
REVENUES: | ||||
Rental income | 104,939 | 90,828 | 308,931 | 253,599 |
Tenant reimbursements | 9,656 | 8,022 | 28,503 | 21,867 |
Other property income (Note 10) | 1,102 | 135 | 7,062 | 961 |
Total revenues | 115,697 | 98,985 | 344,496 | 276,427 |
EXPENSES: | ||||
Property expenses | 25,123 | 21,016 | 71,728 | 55,531 |
Real estate taxes | 10,295 | 8,746 | 29,707 | 23,668 |
Provision for bad debts | 124 | 0 | 219 | 2 |
Ground leases | 929 | 859 | 2,665 | 2,276 |
General and administrative expenses | 10,226 | 8,727 | 29,750 | 26,745 |
Acquisition-related expenses | 568 | 556 | 1,387 | 3,897 |
Depreciation and amortization | 47,569 | 41,724 | 141,814 | 109,780 |
Total expenses | 94,834 | 81,628 | 277,270 | 221,899 |
OTHER (EXPENSES) INCOME: | ||||
Interest income and other net investment gains (Note 11) | 673 | 330 | 1,084 | 703 |
Interest expense (Note 5) | -18,853 | -19,854 | -58,021 | -60,172 |
Total other (expenses) income | -18,180 | -19,524 | -56,937 | -59,469 |
INCOME (LOSS) FROM CONTINUING OPERATIONS | 2,683 | -2,167 | 10,289 | -4,941 |
DISCONTINUED OPERATIONS (NOTE 12) | ||||
Income from discontinued operations (Note 10) | 6,344 | 4,689 | 10,806 | 15,603 |
Net gain on dispositions of discontinued operations | 0 | 0 | 423 | 72,809 |
Total income from discontinued operations | 6,344 | 4,689 | 11,229 | 88,412 |
NET INCOME | 9,027 | 2,522 | 21,518 | 83,471 |
Net income attributable to noncontrolling interests in consolidated subsidiaries | -47 | -48 | -178 | -144 |
NET INCOME ATTRIBUTABLE TO KILROY REALTY CORPORATION | 8,980 | 2,474 | 21,340 | 83,327 |
Preferred distributions | -3,312 | -3,280 | -9,938 | -10,795 |
Original issuance costs of redeemed preferred units | 0 | -2,062 | 0 | -6,980 |
Total preferred distributions | 3,312 | 5,342 | 9,938 | 17,775 |
NET INCOME (LOSS) AVAILABLE TO COMMON STOCKHOLDERS | $5,668 | ($2,868) | $11,402 | $65,552 |
Loss from continuing operations available to common unitholders per common unit-basic (Note 14) | ($0.01) | ($0.10) | ($0.01) | ($0.34) |
Loss from continuing operations available to common unitholders per common unit-diluted (Note 14) | ($0.01) | ($0.10) | ($0.01) | ($0.34) |
Net income (loss) available to common unitholders per unit-basic (Note 14) | $0.07 | ($0.04) | $0.13 | $0.92 |
Net income (loss) available to common unitholders per unit-diluted (Note 14) | $0.07 | ($0.04) | $0.13 | $0.92 |
Weighted average common units outstanding - basic (Note 14) | 78,590,396 | 73,680,259 | 77,574,907 | 69,717,834 |
Weighted average common units outstanding - diluted (Note 14) | 78,590,396 | 73,680,259 | 77,574,907 | 69,717,834 |
Distributions declared per common unit | $0.35 | $0.35 | $1.05 | $1.05 |
Consolidated_Statements_of_Cap
Consolidated Statements of Capital (KILROY REALTY, L.P.) (Kilroy Realty, L.P. [Member], USD $) | 9 Months Ended | 9 Months Ended | ||||||||||||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2012 | Sep. 30, 2012 | Sep. 30, 2012 |
Total Partners Capital [Member] | Total Partners Capital [Member] | Partners Capital Preferred Units [Member] | Partners Capital Preferred Units [Member] | Partners Capital Preferred Units [Member] | Partners Capital Common Unit [Member] | Partners Capital Common Unit [Member] | Noncontrolling Interest In Consolidated Subsidiaries [Member] | Noncontrolling Interest In Consolidated Subsidiaries [Member] | Series A Preferred Units [Member] | Series A Preferred Units [Member] | Series A Preferred Units [Member] | |||
Total Partners Capital [Member] | Partners Capital Common Unit [Member] | |||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||
Beginning Balance | $2,235,933 | $1,327,482 | $2,232,654 | $1,324,841 | $121,582 | $192,411 | $192,411 | $2,040,243 | $1,203,259 | $3,279 | $2,641 | |||
Beginning Balance units | 76,753,484 | 60,537,848 | ||||||||||||
Net income | 21,518 | 83,471 | 21,340 | 83,327 | 21,340 | 83,327 | 178 | 144 | ||||||
Issuance of Series G and Series H Preferred stock | 192,411 | 192,411 | 192,411 | |||||||||||
Redemption of Series E and Series F Preferred stock, shares | -121,582 | |||||||||||||
Redemption of Preferred units | -126,500 | -126,500 | -4,918 | |||||||||||
Original issuance costs of redeemed preferred units | 0 | -6,980 | -2,062 | -2,062 | -2,062 | |||||||||
Issuance of common units | 7,210,838 | 15,813,189 | ||||||||||||
Issuance of common units | 349,951 | 662,371 | 349,951 | 662,371 | 349,951 | 662,371 | ||||||||
Issuance of common units in connection with an operating property acquisition, shares | 118,372 | |||||||||||||
Issuance of common units | 4,885 | 5,604 | 5,604 | 5,604 | 4,885 | |||||||||
Issuance of share-based compensation awards, units | 0 | 62,137 | ||||||||||||
Issuance of share-based compensation awards | 1,075 | 957 | 1,075 | 957 | 1,075 | 957 | ||||||||
Noncash amortization of share-based compensation | 7,096 | 6,182 | 7,096 | 6,182 | 7,096 | 6,182 | ||||||||
Repurchase of common units and restricted stock units, units | -34,164 | -22,312 | ||||||||||||
Repurchase of common units and restricted stock units | -1,803 | -603 | -1,803 | -603 | -1,803 | -603 | ||||||||
Settlement of restricted stock units, units | 4,363 | 5,208 | ||||||||||||
Settlement of restricted stock units | -10 | -133 | -10 | -133 | -10 | -133 | ||||||||
Exercise of stock options, net, units | 473 | 5,000 | ||||||||||||
Exercise of stock options, net | 128 | 129 | 128 | 129 | 128 | 129 | ||||||||
Preferred distributions | -9,938 | -10,795 | -9,938 | -10,795 | -9,938 | -10,795 | ||||||||
Distributions declared per common unit ($1.05 per unit) | -84,741 | -77,146 | -84,741 | -77,146 | -84,741 | -77,146 | ||||||||
Ending Balance | $2,524,094 | $2,061,368 | $2,515,752 | $2,058,583 | $192,411 | $192,411 | $192,411 | $2,323,341 | $1,866,172 | $8,342 | $2,785 | |||
Ending Balance units | 83,934,994 | 76,519,442 |
Consolidated_Statements_of_Cap1
Consolidated Statements of Capital (KILROY REALTY, L.P.) (Parenthetical) (Kilroy Realty, L.P. [Member], USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Kilroy Realty, L.P. [Member] | ||||
Distributions Per Limited Partnership and General Partnership Unit, Outstanding, Basic | $0.35 | $0.35 | $1.05 | $1.05 |
Consolidated_Statements_of_Cas2
Consolidated Statements of Cash Flows (KILROY REALTY, L.P.) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $21,518 | $83,471 |
Adjustments to reconcile net income to net cash provided by operating activities (including discontinued operations): | ||
Depreciation and amortization of building and improvements and leasing costs | 148,982 | 122,754 |
Increase (decrease) in provision for bad debts | 196 | -192 |
Depreciation of furniture, fixtures and equipment | 1,363 | 896 |
Noncash amortization of share-based compensation awards | 6,454 | 5,544 |
Noncash amortization of deferred financing costs and debt discounts and premiums | 4,047 | 7,078 |
Noncash amortization of net below market rents (Note 3) | -6,015 | -4,616 |
Net gain on dispositions of discontinued operations (Note 12) | -423 | -72,809 |
Noncash amortization of deferred revenue related to tenant-funded tenant improvements | -7,585 | -6,851 |
Straight-line rents | -18,188 | -16,433 |
Net change in other operating assets | -6,435 | -2,529 |
Net change in other operating liabilities | 42,844 | 31,965 |
Insurance proceeds received for property damage | -448 | -951 |
Net cash provided by operating activities | 186,310 | 147,327 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Expenditures for acquisition of operating properties (Note 2) | -202,682 | -393,133 |
Expenditures for acquistion of development and redevelopment properties (Note 2) | 13,269 | 163,271 |
Expenditures for operating properties | -83,991 | -60,967 |
Expenditures for development and redevelopment properties and undeveloped land | -222,192 | -52,937 |
Net proceeds received from dispositions of operating properties | 14,409 | 141,810 |
Insurance proceeds received for property damage | 448 | 951 |
Increase in acquisition-related deposits | -4,000 | -8,250 |
Decrease (increase) in restricted cash (Note 1) | 229,613 | -5,526 |
Net cash used in investing activities | -281,664 | -541,323 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Net proceeds from issuance of Series G and Series H preferred stock | 0 | 192,411 |
Borrowings on unsecured line of credit | 10,000 | 418,000 |
Repayments on unsecured line of credit | -195,000 | -573,000 |
Proceeds from issuance of secured debt | 0 | 97,000 |
Principal payments on secured debt | -91,298 | -104,578 |
Proceeds from the issuance of unsecured debt (Note 5) | 299,901 | 150,000 |
Repayments of exchangeable senior notes | 0 | -148,000 |
Financing costs | -3,975 | -5,396 |
Repurchase of common stock and restricted stock units (Note 9) | -1,813 | -736 |
Proceeds from exercise of stock options | 128 | 129 |
Distributions paid to common unitholders | -82,152 | -70,517 |
Distributions paid to preferred unitholders | -9,938 | -10,852 |
Net cash provided by financing activities | 275,804 | 405,332 |
Net increase in cash and cash equivalents | 180,450 | 11,336 |
Cash and cash equivalents, beginning of period | 16,700 | 4,777 |
Cash and cash equivalents, end of period | 197,150 | 16,113 |
SUPPLEMENTAL CASH FLOWS INFORMATION: | ||
Cash paid for interest, net of capitalized interest of $23,573 and $11,531 as of September 30, 2013 and 2012, respectively | 47,107 | 49,378 |
NONCASH INVESTING TRANSACTIONS: | ||
Accrual for expenditures for operating properties and development and redevelopment properties | 79,866 | 8,299 |
Tenant improvements funded directly by tenants | 5,750 | 16,303 |
Assumption of secured debt in connection with property acquisitions (Notes 2 and 5) | 95,496 | 177,678 |
Assumption of other assets and liabilities in connection with operating and development property acquisitions, net (Note 2) | 422 | 11,667 |
Contribution of land, net of related liabilities, by noncontrolling interest to consolidated subsidiary (Note 2) | 4,885 | 0 |
NONCASH FINANCING TRANSACTIONS: | ||
Accrual of distributions payable to common unitholders | 29,378 | 26,782 |
Accrual of distributions payable to preferred unitholders | 1,692 | 1,693 |
Grant date fair value of share-based compensation awards (Note 9) | 10,347 | 30,929 |
Issuance of common units in the Operating Partnership in connection with an operating property acquisition | 4,885 | 5,604 |
Series A Preferred Units [Member] | ||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Payments for Repurchase of Redeemable Preferred Stock | 0 | 75,000 |
Kilroy Realty, L.P. [Member] | ||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | 21,518 | 83,471 |
Adjustments to reconcile net income to net cash provided by operating activities (including discontinued operations): | ||
Depreciation and amortization of building and improvements and leasing costs | 148,982 | 122,754 |
Increase (decrease) in provision for bad debts | 196 | -192 |
Depreciation of furniture, fixtures and equipment | 1,363 | 896 |
Noncash amortization of share-based compensation awards | 6,454 | 5,544 |
Noncash amortization of deferred financing costs and debt discounts and premiums | 4,047 | 7,078 |
Noncash amortization of net below market rents (Note 3) | -6,015 | -4,616 |
Net gain on dispositions of discontinued operations (Note 12) | -423 | -72,809 |
Noncash amortization of deferred revenue related to tenant-funded tenant improvements | -7,585 | -6,851 |
Straight-line rents | -18,188 | -16,433 |
Net change in other operating assets | -6,435 | -2,529 |
Net change in other operating liabilities | 42,844 | 31,965 |
Insurance proceeds received for property damage | -448 | -951 |
Net cash provided by operating activities | 186,310 | 147,327 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Expenditures for acquisition of operating properties (Note 2) | -202,682 | -393,133 |
Expenditures for acquistion of development and redevelopment properties (Note 2) | 13,269 | 163,271 |
Expenditures for operating properties | -83,991 | -60,967 |
Expenditures for development and redevelopment properties and undeveloped land | -222,192 | -52,937 |
Net proceeds received from dispositions of operating properties | 14,409 | 141,810 |
Insurance proceeds received for property damage | 448 | 951 |
Increase in acquisition-related deposits | -4,000 | -8,250 |
Decrease (increase) in restricted cash (Note 1) | 229,613 | -5,526 |
Net cash used in investing activities | -281,664 | -541,323 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Net proceeds from issuance of common units (Note 8) | 349,951 | 662,371 |
Net proceeds from issuance of Series G and Series H preferred stock | 0 | 192,411 |
Borrowings on unsecured line of credit | 10,000 | 418,000 |
Repayments on unsecured line of credit | -195,000 | -573,000 |
Proceeds from issuance of secured debt | 0 | 97,000 |
Principal payments on secured debt | -91,298 | -104,578 |
Proceeds from the issuance of unsecured debt (Note 5) | 299,901 | 150,000 |
Repayments of exchangeable senior notes | 0 | -148,000 |
Financing costs | -3,975 | -5,396 |
Repurchase of common stock and restricted stock units (Note 9) | -1,813 | -736 |
Proceeds from exercise of stock options | 128 | 129 |
Distributions paid to common unitholders | -82,152 | -70,517 |
Distributions paid to preferred unitholders | -9,938 | -10,852 |
Net cash provided by financing activities | 275,804 | 405,332 |
Net increase in cash and cash equivalents | 180,450 | 11,336 |
Cash and cash equivalents, beginning of period | 16,700 | 4,777 |
Cash and cash equivalents, end of period | 197,150 | 16,113 |
SUPPLEMENTAL CASH FLOWS INFORMATION: | ||
Cash paid for interest, net of capitalized interest of $23,573 and $11,531 as of September 30, 2013 and 2012, respectively | 47,107 | 49,378 |
NONCASH INVESTING TRANSACTIONS: | ||
Accrual for expenditures for operating properties and development and redevelopment properties | 79,866 | 8,299 |
Tenant improvements funded directly by tenants | 5,750 | 16,303 |
Assumption of secured debt in connection with property acquisitions (Notes 2 and 5) | 95,496 | 177,678 |
Assumption of other assets and liabilities in connection with operating and development property acquisitions, net (Note 2) | 422 | 11,667 |
NONCASH FINANCING TRANSACTIONS: | ||
Accrual of distributions payable to common unitholders | 29,378 | 26,782 |
Accrual of distributions payable to preferred unitholders | 1,692 | 1,693 |
Grant date fair value of share-based compensation awards (Note 9) | 10,347 | 30,929 |
Issuance of common units in the Operating Partnership in connection with an operating property acquisition | 4,885 | 5,604 |
Kilroy Realty, L.P. [Member] | Series A Preferred Units [Member] | ||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Payments for Repurchase of Redeemable Preferred Stock | 0 | |
Series E and Series F Cumulative Redeemable Preferred Stock [Member] | ||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Payments for Repurchase of Redeemable Preferred Stock | 0 | -126,500 |
Series E and Series F Cumulative Redeemable Preferred Stock [Member] | Kilroy Realty, L.P. [Member] | ||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Payments for Repurchase of Redeemable Preferred Stock | 0 | 126,500 |
Series A Preferred Units [Member] | Kilroy Realty, L.P. [Member] | ||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Payments for Repurchase of Redeemable Preferred Stock | $75,000 |
Consolidated_Statements_of_Cas3
Consolidated Statements of Cash Fiows (Kilroy Realty, L.P.) (Parenthetical) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Interest Paid, Capitalized | $23,573 | $11,531 |
Kilroy Realty, L.P. [Member] | ||
Interest Paid, Capitalized | $23,573 | $11,531 |
Organization_and_Basis_of_Pres
Organization and Basis of Presentation | 9 Months Ended | |||||||||||
Sep. 30, 2013 | ||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||||||||
Organization and Basis of Presentation | Organization and Basis of Presentation | |||||||||||
Organization | ||||||||||||
Kilroy Realty Corporation (the “Company”) is a self-administered real estate investment trust (“REIT”) active in premier office submarkets along the West Coast. We own, develop, acquire and manage real estate assets, consisting primarily of Class A properties in the coastal regions of Los Angeles, Orange County, San Diego, the San Francisco Bay Area and greater Seattle, which we believe have strategic advantages and strong barriers to entry. Class A real estate encompasses attractive and efficient buildings of high quality that are attractive to tenants, are well-designed and constructed with above-average material, workmanship and finishes and are well-maintained and managed. We qualify as a REIT under the Internal Revenue Code of 1986, as amended (the “Code”). The Company’s common stock is publicly traded on the New York Stock Exchange (“NYSE”) under the ticker symbol “KRC.” | ||||||||||||
We own our interests in all of our real estate assets through Kilroy Realty, L.P. (the “Operating Partnership”), Kilroy Realty Finance Partnership, L.P. (the “Finance Partnership”). We conduct substantially all of our operations through the Operating Partnership. Unless stated otherwise or the context indicates otherwise, the terms “Kilroy Realty Corporation” or the “Company,” “we,” “our,” and “us” refer to Kilroy Realty Corporation and its consolidated subsidiaries and the term “Operating Partnership” refers to Kilroy Realty, L.P. and its consolidated subsidiaries. The descriptions of our business, employees, and properties apply to both the Company and the Operating Partnership. | ||||||||||||
Our stabilized portfolio of operating properties was comprised of the following office properties at September 30, 2013: | ||||||||||||
Number of | Rentable | Number of | Percentage | |||||||||
Buildings | Square Feet | Tenants | Occupied | |||||||||
Stabilized Office Properties (1) | 103 | 12,536,495 | 654 | 92.2 | % | |||||||
______________ | ||||||||||||
-1 | Excludes 13 properties located in San Diego, California and one property in Anaheim, California that were held for sale at September 30, 2013 (see Note 12 “Discontinued Operations”). | |||||||||||
Our stabilized portfolio includes all of our properties with the exception of properties held for sale, undeveloped land, development and redevelopment properties currently under construction or committed for construction, and “lease-up” properties. As of September 30, 2013, our stabilized portfolio of operating properties excluded the 14 properties that were classified as held for sale as of that date. (See Note 12 for additional information). We define redevelopment properties as those projects for which we expect to spend significant development and construction costs on existing or acquired buildings pursuant to a formal plan, the intended result of which is a higher economic return on the property. We define “lease-up” properties as properties we recently developed or redeveloped that have not yet reached 95% occupancy and are within one year following cessation of major construction activities. As of September 30, 2013, the following properties were excluded from our stabilized portfolio: | ||||||||||||
Number of Properties | Estimated Rentable | |||||||||||
Square Feet | ||||||||||||
Properties Held for Sale (1) | 14 | 1,159,185 | ||||||||||
Development properties under construction (2) | 5 | 1,516,000 | ||||||||||
Lease-up properties | 2 | 508,000 | ||||||||||
_______________ | ||||||||||||
-1 | Includes 13 properties located in San Diego, California and one property in Anaheim, California (see Note 12). | |||||||||||
(2) Estimated rentable square feet upon completion. | ||||||||||||
As of September 30, 2013, all of our properties and development and redevelopment projects are owned and all of our business is currently conducted in the state of California with the exception of 11 office properties located in the state of Washington. | ||||||||||||
As of September 30, 2013, the Company owned a 97.8% common general partnership interest in the Operating Partnership. The remaining 2.2% common limited partnership interest in the Operating Partnership as of September 30, 2013 was owned by non-affiliated investors and certain of our executive officers and directors (see Note 6). Both the general and limited common partnership interests in the Operating Partnership are denominated in common units. The number of common units held by the Company is at all times equivalent to the number of outstanding shares of the Company’s common stock, and the rights of all the | ||||||||||||
common units to quarterly distributions and payments in liquidation mirror those of the Company’s common stockholders. The common limited partners have certain redemption rights as provided in the Operating Partnership’s Seventh Amended and Restated Agreement of Limited Partnership (as amended, the “Partnership Agreement”) (see Note 6). | ||||||||||||
Kilroy Realty Finance, Inc., which is a wholly-owned subsidiary of the Company, is the sole general partner of the Finance Partnership and owns a 1.0% general partnership interest in the Finance Partnership. The Operating Partnership owns the remaining 99.0% limited partnership interest. Kilroy Services, LLC (“KSLLC”), which is a wholly-owned subsidiary of the Operating Partnership, is the entity through which we conduct substantially all of our development activities. With the exception of the Operating Partnership and Redwood City Partners, LLC (see Note 2), all of our subsidiaries are wholly-owned. | ||||||||||||
Basis of Presentation | ||||||||||||
The consolidated financial statements of the Company include the consolidated financial position and results of operations of the Company, the Operating Partnership, the Finance Partnership, KSLLC, Redwood City Partners, LLC and all of our wholly-owned and controlled subsidiaries. The consolidated financial statements of the Operating Partnership include the consolidated financial position and results of operations of the Operating Partnership, the Finance Partnership, KSLLC, Redwood City Partners, LLC and all wholly-owned and controlled subsidiaries of the Operating Partnership. All intercompany balances and transactions have been eliminated in the consolidated financial statements. | ||||||||||||
The accompanying interim financial statements have been prepared by management in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and in conjunction with the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures required for annual financial statements have been condensed or excluded pursuant to SEC rules and regulations. Accordingly, the interim financial statements do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, the accompanying interim financial statements reflect all adjustments of a normal and recurring nature that are considered necessary for a fair presentation of the results for the interim periods presented. However, the results of operations for the interim periods are not necessarily indicative of the results that may be expected for the year ending December 31, 2013. The interim financial statements for the Company and the Operating Partnership should be read in conjunction with the audited consolidated financial statements and notes thereto included in our annual report on Form 10-K for the year ended December 31, 2012. | ||||||||||||
Certain amounts in the consolidated statements of operations for prior periods have been reclassified to reflect the activity of discontinued operations. | ||||||||||||
Partially Owned Entities and Variable Interest Entities | ||||||||||||
Our accounting policy is to consolidate entities in which we have a controlling financial interest and significant decision making control over the entities operations. In determining whether we have a controlling financial interest in a partially owned entity and the requirement to consolidate the accounts of that entity, we consider factors such as ownership interest, board representation, management representation, size of our investment (including loans), authority to control decisions, and contractual and substantive participating rights of the members. In addition to evaluating control rights, we also consolidate entities in which the other member has no substantive kick-out rights to remove the Company as the managing member. | ||||||||||||
We also evaluate whether the entity is a variable interest entity (“VIE”) and whether we are the primary beneficiary. VIEs are entities in which the equity investors do not have sufficient equity at risk to finance their endeavors without additional financial support or that the holders of the equity investment at risk do not have a controlling financial interest. We are deemed to be the primary beneficiary of a VIE when we have the power to direct the activities of the VIE that most significantly impact the VIEs economic performance and the obligation to absorb losses or receive benefits that could potentially be significant to the VIE. | ||||||||||||
If the requirements for consolidation are not met, the Company would account for investments under the equity method of accounting if we have the ability to exercise significant influence over the entity. Equity method investments would be initially recorded at cost and subsequently adjusted for our share of net income or loss and cash contributions and distributions each period. The Company did not have any equity method investments at September 30, 2013 or December 31, 2012. | ||||||||||||
As of September 30, 2013, the consolidated financial statements of the Company and the Operating Partnership included two VIEs, in which we were deemed to be the primary beneficiary. One of the VIEs was established on June 27, 2013 (see Note 2 for additional information), and the second VIE was established during the third quarter of 2013 to facilitate a potential like-kind exchange pursuant to Section 1031 of the Code (“Section 1031 Exchanges”) to defer taxable gains on dispositions for federal and state income tax purposes. To realize the tax deferral available under a Section 1031 Exchange, the Company must complete the Section 1031 Exchanges, if any, and complete the sale of the to-be-exchanged properties within 180 days of the acquisition date | ||||||||||||
(see Note 2). The VIE established during the third quarter of 2013 will be terminated upon the completion of the Section 1031 Exchanges or the expiration of the 180 day period, as applicable. The impact of consolidating the VIEs increased the Company’s total assets, liabilities and noncontrolling interests by approximately $135.3 million (of which $119.3 million is related to real estate held for investment on our consolidated balance sheet), $4.1 million and $4.9 million, respectively, at September 30, 2013. | ||||||||||||
As of December 31, 2012, the consolidated financial statements of the Company and the Operating Partnership included two VIEs, in which we were deemed to be the primary beneficiary. The VIEs were established during 2012 to facilitate potential Section 1031 Exchanges to defer taxable gains on dispositions for federal and state income tax purposes. During the year ended December 31, 2012, one operating property and one development project were acquired in two separate transactions and transferred to the two special purpose VIEs to facilitate potential Section 1031 Exchanges. The impact of consolidating the VIEs increased the Company’s total assets and liabilities by approximately $337.0 million (of which $319.8 million is related to real estate held for investment on our consolidated balance sheet) and $111.1 million, respectively, at December 31, 2012. During the three months ended March 31, 2013, the Section 1031 Exchanges were completed and the VIEs were terminated. As a result, $228.3 million of restricted cash set aside at December 31, 2012 to facilitate the Section 1031 Exchanges was released from escrow. |
Acquisitions
Acquisitions | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
Business Combinations [Abstract] | ||||||||||||||
Acquisitions | Acquisitions | |||||||||||||
Operating Properties | ||||||||||||||
During the nine months ended September 30, 2013, we acquired the four operating office properties, listed below, in two transactions from unrelated third parties. The January 2013 acquisition was funded with a portion of the remaining proceeds from the sale of our industrial portfolio that was included in restricted cash at December 31, 2012 and the assumption of existing mortgage debt (see Note 5). The September 2013 acquisition was funded with proceeds from our September 2013 equity offering (see Note 7). | ||||||||||||||
Property | Date of Acquisition | Number of | Rentable Square | Occupancy as of September 30, 2013 | Purchase | |||||||||
Buildings | Feet | Price | ||||||||||||
(in millions) (1) | ||||||||||||||
320 Westlake Ave. N. and 321 Terry Ave. N. (2)(3) | ||||||||||||||
Seattle, WA | January 16, 2013 | 2 | 320,398 | 100.00% | $ | 170 | ||||||||
12780 and 12790 El Camino Real (4) | ||||||||||||||
San Diego, CA | September 19, 2013 | 2 | 218,940 | 100.00% | 126.4 | |||||||||
Total | 4 | 539,338 | $ | 296.4 | ||||||||||
_______________ | ||||||||||||||
-1 | Excludes acquisition-related costs and includes assumed tenant improvements. | |||||||||||||
-2 | We acquired these properties through a new special purpose entity wholly owned by the Finance Partnership. | |||||||||||||
-3 | In connection with this acquisition, we assumed secured debt with an outstanding principal balance of $83.9 million that was recorded at fair value on the acquisition date, resulting in a premium of approximately $11.6 million (see Note 5). | |||||||||||||
-4 | As of September 30, 2013, these properties, together the “Heights of Del Mar” project, are temporarily being held in a separate VIE to facilitate potential Section 1031 Exchanges (see Note 1). The $126.4 million purchase price includes $9.4 million for 4.2 acres of undeveloped land the Company acquired in connection with this acquisition. | |||||||||||||
The related assets, liabilities, and results of operations of the acquired properties are included in the consolidated financial statements as of the date of acquisition. The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date: | ||||||||||||||
Total 2013 | ||||||||||||||
Acquisitions (1) | ||||||||||||||
(in thousands) | ||||||||||||||
Assets | ||||||||||||||
Land and improvements | $ | 53,790 | ||||||||||||
Buildings and improvements (2) | 218,211 | |||||||||||||
Undeveloped land and construction in progress (3) | 9,360 | |||||||||||||
Deferred leasing costs and acquisition-related intangible assets (4) | 30,789 | |||||||||||||
Total assets acquired | 312,150 | |||||||||||||
Liabilities | ||||||||||||||
Deferred revenue and acquisition-related intangible liabilities (5) | 4,190 | |||||||||||||
Secured debt (6) | 95,496 | |||||||||||||
Accounts payable, accrued expenses and other liabilities | 422 | |||||||||||||
Total liabilities assumed | 100,108 | |||||||||||||
Net assets and liabilities acquired (7) | $ | 212,042 | ||||||||||||
_______________ | ||||||||||||||
-1 | The purchase price of the two acquisitions completed during the nine months ended September 30, 2013 were individually less than 5% and in aggregate less than 10% of the Company’s total assets as of September 30, 2013. | |||||||||||||
-2 | Represents buildings, building improvements and tenant improvements. | |||||||||||||
-3 | In connection with one of the acquisitions, we acquired undeveloped land of approximately 4.2 acres that was added to the Company’s future development pipeline upon acquisition. | |||||||||||||
-4 | Represents in-place leases (approximately $19.6 million with a weighted average amortization period of 4.7 years), above-market leases (approximately $3.2 million with a weighted average amortization period of 6.1 years), and leasing commissions (approximately $7.9 million with a weighted average amortization period of 5.9 years). | |||||||||||||
-5 | Represents below-market leases (approximately $4.2 million with a weighted average amortization period of 7.7 years). | |||||||||||||
-6 | Represents the mortgage loan, which includes an unamortized premium of approximately $11.6 million at the date of acquisition, assumed in connection with the properties acquired in January 2013 (see Note 5). | |||||||||||||
-7 | Reflects the purchase price net of assumed secured debt and other lease-related obligations. | |||||||||||||
Undeveloped Land/Formation of New Consolidated Subsidiary | ||||||||||||||
On June 27, 2013, the Company entered into an agreement with an unaffiliated third party and formed a new consolidated subsidiary, Redwood City Partners, LLC. In connection with this transaction, the Company acquired a 0.35 acre land site, completing the first phase of the land assemblage for its plans to develop an approximate 300,000 square foot office project (the “Crossing 900” project) in Redwood City, California. The related assets, liabilities, and noncontrolling interest acquired in connection with this transaction are included in the consolidated financial statements as of the date of acquisition. The following table summarizes the allocation of the assets acquired and liabilities assumed at the acquisition date (in thousands): | ||||||||||||||
Assets | ||||||||||||||
Undeveloped land and construction in progress | $ | 11,222 | ||||||||||||
Total assets | 11,222 | |||||||||||||
Liabilities | ||||||||||||||
Secured debt (1) | 1,750 | |||||||||||||
Accounts payable, accrued expenses and other liabilities | 1,952 | |||||||||||||
Total liabilities | 3,702 | |||||||||||||
Noncontrolling interest in consolidated subsidiary | 4,885 | |||||||||||||
Net assets and liabilities acquired | $ | 2,635 | ||||||||||||
_______________ | ||||||||||||||
(1) This note was repaid as of September 30, 2013. | ||||||||||||||
In October 2013, the Company acquired a 2.0 acre undeveloped land parcel for $17.0 million, completing the final phase of the land assemblage for the Crossing 900 project (see Note 15 for additional information). |
Deferred_Leasing_Costs_and_Acq
Deferred Leasing Costs and Acquisition-related Intangible Assets and Liabilities, net | 9 Months Ended | |||||||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||||||
Intangible Assets and Liabilities Disclosure [Abstract] | ||||||||||||||||||||||||
Intangible Assets and Liabilities Disclosure [Text Block] | Deferred Leasing Costs and Acquisition-related Intangible Assets and Liabilities, net | |||||||||||||||||||||||
The following table summarizes our deferred leasing costs and acquisition-related intangible assets (acquired value of leasing costs, above-market operating leases, in-place leases and below-market ground lease obligation) and intangible liabilities (acquired value of below-market operating leases and above-market ground lease obligation) as of September 30, 2013 and December 31, 2012: | ||||||||||||||||||||||||
September 30, 2013 | December 31, 2012 | |||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
Deferred Leasing Costs and Acquisition-related Intangible Assets, net: | ||||||||||||||||||||||||
Deferred leasing costs | $ | 170,609 | $ | 168,087 | ||||||||||||||||||||
Accumulated amortization | (59,943 | ) | (61,443 | ) | ||||||||||||||||||||
Deferred leasing costs, net | 110,666 | 106,644 | ||||||||||||||||||||||
Above-market operating leases | 28,842 | 27,977 | ||||||||||||||||||||||
Accumulated amortization | (14,038 | ) | (12,180 | ) | ||||||||||||||||||||
Above-market operating leases, net | 14,804 | 15,797 | ||||||||||||||||||||||
In-place leases | 108,612 | 101,061 | ||||||||||||||||||||||
Accumulated amortization | (44,476 | ) | (34,019 | ) | ||||||||||||||||||||
In-place leases, net | 64,136 | 67,042 | ||||||||||||||||||||||
Below-market ground lease obligation | 490 | 690 | ||||||||||||||||||||||
Accumulated amortization | (11 | ) | (205 | ) | ||||||||||||||||||||
Below-market ground lease obligation, net | 479 | 485 | ||||||||||||||||||||||
Total deferred leasing costs and acquisition-related intangible assets, net | $ | 190,085 | $ | 189,968 | ||||||||||||||||||||
Acquisition-related Intangible Liabilities, net: (1) | ||||||||||||||||||||||||
Below-market operating leases | $ | 70,966 | $ | 70,486 | ||||||||||||||||||||
Accumulated amortization | (24,074 | ) | (17,555 | ) | ||||||||||||||||||||
Below-market operating leases, net | 46,892 | 52,931 | ||||||||||||||||||||||
Above-market ground lease obligation | 6,320 | 6,320 | ||||||||||||||||||||||
Accumulated amortization | (198 | ) | (122 | ) | ||||||||||||||||||||
Above-market ground lease obligation, net | 6,122 | 6,198 | ||||||||||||||||||||||
Total acquisition-related intangible liabilities, net | $ | 53,014 | $ | 59,129 | ||||||||||||||||||||
_______________ | ||||||||||||||||||||||||
-1 | Included in deferred revenue and acquisition-related intangible liabilities, net in the consolidated balance sheets. | |||||||||||||||||||||||
The following table sets forth amortization related to deferred leasing costs and acquisition-related intangibles, including amounts attributable to discontinued operations, for the three and nine months ended September 30, 2013 and 2012: | ||||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
Deferred leasing costs (1) | $ | 6,945 | $ | 5,238 | $ | 20,882 | $ | 14,126 | ||||||||||||||||
Above-market operating leases (2) | 1,417 | 1,459 | 4,214 | 4,205 | ||||||||||||||||||||
In-place leases (1) | 7,677 | 6,479 | 22,546 | 14,858 | ||||||||||||||||||||
Below-market ground lease obligation (3) | 2 | 52 | 6 | 153 | ||||||||||||||||||||
Below-market operating leases (4) | (3,355 | ) | (3,487 | ) | (10,229 | ) | (8,821 | ) | ||||||||||||||||
Above-market ground lease obligation (5) | (25 | ) | (25 | ) | (76 | ) | (60 | ) | ||||||||||||||||
Total | $ | 12,661 | $ | 9,716 | $ | 37,343 | $ | 24,461 | ||||||||||||||||
_______________ | ||||||||||||||||||||||||
-1 | The amortization of deferred leasing costs and in-place leases is recorded to depreciation and amortization expense in the consolidated statements of operations for the periods presented. | |||||||||||||||||||||||
-2 | The amortization of above-market operating leases is recorded as a decrease to rental income in the consolidated statements of operations for the periods presented. | |||||||||||||||||||||||
-3 | The amortization of the below-market ground lease obligation is recorded as an increase to ground lease expense in the consolidated statements of operations for the periods presented. | |||||||||||||||||||||||
-4 | The amortization of below-market operating leases is recorded as an increase to rental income in the consolidated statements of operations for the periods presented. | |||||||||||||||||||||||
-5 | The amortization of the above-market ground lease obligation is recorded as a decrease to ground lease expense in the consolidated statements of operations for the periods presented. | |||||||||||||||||||||||
The following table sets forth the estimated annual amortization expense related to deferred leasing costs and acquisition-related intangibles as of September 30, 2013 for future periods: | ||||||||||||||||||||||||
Year | Deferred Leasing Costs | Above-Market Operating Leases (1) | In-Place Leases | Below-Market Ground Lease Obligation (2) | Below-Market Operating Leases (3) | Above-Market Ground Lease Obligation (4) | ||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
Remaining 2013 | $ | 6,384 | $ | 1,367 | $ | 6,549 | $ | 2 | $ | (3,201 | ) | $ | (25 | ) | ||||||||||
2014 | 23,533 | 4,837 | 19,053 | 8 | (11,903 | ) | (101 | ) | ||||||||||||||||
2015 | 19,669 | 3,035 | 12,676 | 8 | (9,385 | ) | (101 | ) | ||||||||||||||||
2016 | 16,920 | 2,007 | 9,445 | 8 | (7,195 | ) | (101 | ) | ||||||||||||||||
2017 | 14,468 | 1,690 | 7,744 | 8 | (6,127 | ) | (101 | ) | ||||||||||||||||
Thereafter | 29,692 | 1,868 | 8,669 | 445 | (9,081 | ) | (5,693 | ) | ||||||||||||||||
Total | $ | 110,666 | $ | 14,804 | $ | 64,136 | $ | 479 | $ | (46,892 | ) | $ | (6,122 | ) | ||||||||||
_______________ | ||||||||||||||||||||||||
-1 | Represents estimated annual amortization related to above-market operating leases. Amounts will be recorded as a decrease to rental income in the consolidated statements of operations. | |||||||||||||||||||||||
-2 | Represents estimated annual amortization related to below-market ground lease obligations. Amounts will be recorded as an increase to ground lease expense in the consolidated statements of operations. | |||||||||||||||||||||||
-3 | Represents estimated annual amortization related to below-market operating leases. Amounts will be recorded as an increase to rental income in the consolidated statements of operations. | |||||||||||||||||||||||
-4 | Represents estimated annual amortization related to above-market ground lease obligations. Amounts will be recorded as a decrease to ground lease expense in the consolidated statements of operations. |
Receivables
Receivables | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Receivables [Abstract] | ||||||||
Receivables | Receivables | |||||||
Current Receivables, net | ||||||||
Current receivables, net is primarily comprised of contractual rents and other lease-related obligations due from tenants. The balance consisted of the following as of September 30, 2013 and December 31, 2012: | ||||||||
September 30, 2013 (1) | 31-Dec-12 | |||||||
(in thousands) | ||||||||
Current receivables | $ | 14,301 | $ | 11,801 | ||||
Allowance for uncollectible tenant receivables | (2,532 | ) | (2,581 | ) | ||||
Current receivables, net | $ | 11,769 | $ | 9,220 | ||||
_______________ | ||||||||
-1 | Excludes current receivables, net related to properties held for sale at September 30, 2013. | |||||||
Deferred Rent Receivables, net | ||||||||
Deferred rent receivables, net consisted of the following as of September 30, 2013 and December 31, 2012: | ||||||||
September 30, 2013 (1) | 31-Dec-12 | |||||||
(in thousands) | ||||||||
Deferred rent receivables | $ | 123,632 | $ | 118,025 | ||||
Allowance for deferred rent receivables | (1,973 | ) | (2,607 | ) | ||||
Deferred rent receivables, net | $ | 121,659 | $ | 115,418 | ||||
_______________ | ||||||||
-1 | Excludes deferred rent receivables, net related to properties held for sale at September 30, 2013. |
Secured_and_Unsecured_Debt_of_
Secured and Unsecured Debt of the Operating Partnership (Kilroy Realty, L.P. [Member]) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Kilroy Realty, L.P. [Member] | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Secured and Unsecured Debt of the Operating Partnership | Secured and Unsecured Debt of the Operating Partnership | |||||||||||||||
Secured Debt | ||||||||||||||||
The following table sets forth the composition of our secured debt as of September 30, 2013 and December 31, 2012: | ||||||||||||||||
Type of Debt | Annual Stated Interest Rate (1) | GAAP | Maturity Date | September 30, 2013 (3) | December 31, 2012 (3) | |||||||||||
Effective Rate (1)(2) | ||||||||||||||||
(in thousands) | ||||||||||||||||
Mortgage note payable | 4.27% | 4.27% | Feb-18 | $ | 133,689 | $ | 135,000 | |||||||||
Mortgage note payable (4) | 4.48% | 4.48% | Jul-27 | 97,000 | 97,000 | |||||||||||
Mortgage note payable (4)(5) | 6.05% | 3.50% | Jun-19 | 93,306 | — | |||||||||||
Mortgage note payable (6) | 6.37% | 3.55% | Apr-13 | — | 83,116 | |||||||||||
Mortgage note payable | 6.51% | 6.51% | Feb-17 | 67,907 | 68,615 | |||||||||||
Mortgage note payable (4) | 5.23% | 3.50% | Jan-16 | 55,007 | 56,302 | |||||||||||
Mortgage note payable (4) | 5.57% | 3.25% | Feb-16 | 41,999 | 43,016 | |||||||||||
Mortgage note payable (4) | 5.09% | 3.50% | Aug-15 | 34,979 | 35,379 | |||||||||||
Mortgage note payable (4) | 4.94% | 4.00% | Apr-15 | 27,970 | 28,941 | |||||||||||
Mortgage note payable | 7.15% | 7.15% | May-17 | 9,546 | 11,210 | |||||||||||
Other | Various | Various | Various | 2,495 | 2,517 | |||||||||||
Total | $ | 563,898 | $ | 561,096 | ||||||||||||
______________ | ||||||||||||||||
-1 | All interest rates presented are fixed-rate interest rates. | |||||||||||||||
-2 | This represents the rate at which interest expense is recorded for financial reporting purposes, which reflects the amortization of discounts/premiums, excluding debt issuance costs. | |||||||||||||||
-3 | Amounts reported include the amounts of unamortized debt premiums and discounts for the periods presented. | |||||||||||||||
-4 | The secured debt and the related properties that secure the debt are held in a special purpose entity and the properties are not available to satisfy the debts and other obligations of the Company or the Operating Partnership. | |||||||||||||||
-5 | In January 2013, in connection with the acquisition of two office buildings in Seattle, Washington, we assumed a mortgage loan that is secured by the project. The assumed mortgage had a principal balance of $83.9 million at the acquisition date and was recorded at fair value on the date of the acquisition resulting in a premium of approximately $11.6 million. The loan requires monthly principal and interest payments based on a 6.4 year amortization period. | |||||||||||||||
-6 | In January 2013, we repaid this loan prior to the stated maturity date. | |||||||||||||||
Although our mortgage loans are secured and non-recourse to the Company and the Operating Partnership, the Company provides limited customary secured debt guarantees for items such as voluntary bankruptcy, fraud, misapplication of payments, | ||||||||||||||||
and environmental liabilities. | ||||||||||||||||
4.25% Exchangeable Senior Notes | ||||||||||||||||
The table below summarizes the balance and significant terms of the Company’s 4.25% Exchangeable Notes due November 2014 (the “4.25% Exchangeable Notes”) outstanding as of September 30, 2013 and December 31, 2012. | ||||||||||||||||
4.25% Exchangeable Notes | ||||||||||||||||
September 30, | December 31, | |||||||||||||||
2013 | 2012 | |||||||||||||||
(in thousands) | ||||||||||||||||
Principal amount | $ | 172,500 | $ | 172,500 | ||||||||||||
Unamortized discount | (5,264 | ) | (8,556 | ) | ||||||||||||
Net carrying amount of liability component | $ | 167,236 | $ | 163,944 | ||||||||||||
Carrying amount of equity component | $19,835 | |||||||||||||||
Issuance date | Nov-09 | |||||||||||||||
Maturity date | Nov-14 | |||||||||||||||
Stated coupon rate (1) | 4.25% | |||||||||||||||
Effective interest rate (2) | 7.13% | |||||||||||||||
Exchange rate per $1,000 principal value of the 4.25% Exchangeable Notes, as adjusted (3) | 27.8307 | |||||||||||||||
Exchange price, as adjusted (3) | $35.93 | |||||||||||||||
Number of shares on which the aggregate consideration to be delivered on conversion is determined (3) | 4,800,796 | |||||||||||||||
_______________ | ||||||||||||||||
-1 | Interest on the 4.25% Exchangeable Notes is payable semi-annually in arrears on May 15th and November 15th of each year. | |||||||||||||||
-2 | The rate at which we record interest expense for financial reporting purposes, which reflects the amortization of the discounts on the 4.25% Exchangeable Notes. This rate represents our conventional debt borrowing rate at the date of issuance. | |||||||||||||||
-3 | The exchange rate, exchange price, and the number of shares to be delivered upon conversion are subject to adjustment under certain circumstances including increases in our common dividends. | |||||||||||||||
The 4.25% Exchangeable Notes are exchangeable for shares of the Company’s common stock prior to maturity only upon the occurrence of certain events. During the three and nine months ended September 30, 2013, the closing sale price per share of the common stock of the Company was more than 130% of the exchange price per share of the Company’s common stock for at least 20 trading days in the specified period. As a result, for the three month period ending December 31, 2013, the 4.25% Exchangeable Notes are exchangeable at the exchange rate stated above and may be exchangeable thereafter, if one or more of the events were again to occur during future measurement periods. | ||||||||||||||||
For the three and nine months ended September 30, 2013 and 2012, the per share average trading price of the Company’s common stock on the NYSE was higher than the $35.93 exchange price for the 4.25% Exchangeable Notes, as presented below: | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Per share average trading price of the Company’s common stock | $51.57 | $47.56 | $52.42 | $45.74 | ||||||||||||
The 4.25% Exchangeable Notes were exchangeable as of September 30, 2013, and were not exchangeable as of September 30, 2012. If the Exchangeable Notes were exchangeable for all periods presented, the approximate fair value of the shares upon exchangeable at September 30, 2013 and 2012, using the per share average trading price presented in the table above, would have been as follows: | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(in thousands) | ||||||||||||||||
Approximate fair value of shares upon conversion | $ | 245,200 | $ | 225,100 | $ | 248,000 | $ | 218,600 | ||||||||
Principal amount of the 4.25% Exchangeable Notes | 172,500 | 172,500 | 172,500 | 172,500 | ||||||||||||
Approximate fair value in excess amount of principal amount | $ | 72,700 | $ | 52,600 | $ | 75,500 | $ | 46,100 | ||||||||
See Notes 13 and 14 for a discussion of the impact of the 4.25% Exchangeable Notes on our diluted earnings per share and unit calculations for the periods presented. | ||||||||||||||||
Interest Expense for the Exchangeable Notes | ||||||||||||||||
The unamortized discount on the 4.25% Exchangeable Notes and the 3.25% Exchangeable Notes due April 2012 (the “3.25% Exchangeable Notes” and together with the 4.25% Exchangeable Notes, the “Exchangeable Notes”) is accreted as additional interest expense from the date of issuance through the maturity date of the applicable Exchangeable Notes. The following table summarizes the total interest expense attributable to the 4.25% Exchangeable Notes and attributable to the 3.25% Exchangeable Notes (which were repaid upon maturity in April 2012), in each case based on the respective effective interest rates, before the effect of capitalized interest, for the three and nine months ended September 30, 2013 and 2012: | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(in thousands) | ||||||||||||||||
Contractual interest payments (1) | $ | 1,833 | $ | 1,833 | $ | 5,498 | $ | 6,888 | ||||||||
Amortization of discount (1) | 1,116 | 1,041 | 3,291 | 3,993 | ||||||||||||
Interest expense attributable to the Exchangeable Notes (1) | $ | 2,949 | $ | 2,874 | $ | 8,789 | $ | 10,881 | ||||||||
_______________ | ||||||||||||||||
-1 | The Company repaid the 3.25% Exchangeable Notes in April 2012. Interest payments and discount amortization for the three and nine months ended September 30, 2013 and three months ended September 30, 2012 are solely attributable to the 4.25% Exchangeable Notes. | |||||||||||||||
Capped Call Transactions | ||||||||||||||||
In connection with the offering of the 4.25% Exchangeable Notes, we entered into capped call option transactions (“capped calls”) to mitigate the dilutive impact of the potential exchange of the 4.25% Exchangeable Notes. The table below summarizes our capped call option positions for the 4.25% Exchangeable Notes as of September 30, 2013 and December 31, 2012. | ||||||||||||||||
4.25% Exchangeable Notes | ||||||||||||||||
Referenced shares of common stock | 4,800,796 | |||||||||||||||
Exchange price including effect of capped calls | $ | 42.81 | ||||||||||||||
The capped calls are expected to terminate upon the earlier of the maturity date of the 4.25% Exchangeable Notes or upon the date upon which the 4.25% Exchangeable Notes are no longer outstanding resulting from an exchange or repurchase by us. The initial cost of capped calls were recorded as a reduction to additional paid-in capital. | ||||||||||||||||
Unsecured Senior Notes | ||||||||||||||||
In January 2013, the Operating Partnership issued unsecured senior notes in a public offering with an aggregate principal balance of $300.0 million, which is included in unsecured debt, net on our consolidated balance sheets. The unsecured senior notes, which are scheduled to mature on January 15, 2023, require semi-annual interest payments each January and July based on a stated annual interest rate of 3.80%. The unsecured senior notes are shown net of the initial issuance discount of $0.1 million on the consolidated balance sheets. The Company used a portion of the net proceeds for general corporate purposes, including the repayment of borrowings under the Operating Partnership’s revolving credit facility. | ||||||||||||||||
Unsecured Revolving Credit Facility | ||||||||||||||||
The following table summarizes the balance and terms of our revolving credit facility as of September 30, 2013 and December 31, 2012, respectively: | ||||||||||||||||
September 30, | December 31, | |||||||||||||||
2013 | 2012 | |||||||||||||||
(in thousands) | ||||||||||||||||
Outstanding borrowings | $ | — | $ | 185,000 | ||||||||||||
Remaining borrowing capacity | 500,000 | 315,000 | ||||||||||||||
Total borrowing capacity (1) | $ | 500,000 | $ | 500,000 | ||||||||||||
Interest rate (2) | 1.66 | % | ||||||||||||||
Facility fee-annual rate (3) | 0.30% | |||||||||||||||
Maturity date (4) | Apr-17 | |||||||||||||||
_______________ | ||||||||||||||||
-1 | We may elect to borrow, subject to bank approval, up to an additional $200.0 million under an accordion feature under the terms of the revolving credit facility. | |||||||||||||||
-2 | The revolving credit facility interest rate was calculated based on an annual rate of LIBOR plus 1.450% as of both September 30, 2013 and December 31, 2012. No interest rate is shown as of September 30, 2013 because no borrowings were outstanding. | |||||||||||||||
-3 | The facility fee is paid on a quarterly basis and is calculated based on the total borrowing capacity. In addition to the facility fee, from 2010 to 2012 we incurred debt origination and legal costs totaling approximately $10.2 million that are currently being amortized through the maturity date of the revolving credit facility. | |||||||||||||||
-4 | Under the terms of the revolving credit facility, we may exercise an option to extend the maturity date by one year. | |||||||||||||||
The Company intends to borrow amounts under the revolving credit facility from time to time for general corporate purposes, to fund potential acquisitions, to finance development and redevelopment expenditures and to potentially repay long-term debt. | ||||||||||||||||
Debt Covenants and Restrictions | ||||||||||||||||
The revolving credit facility, the term loan facility, the unsecured senior notes, and certain other secured debt arrangements contain covenants and restrictions requiring us to meet certain financial ratios and reporting requirements. Some of the more restrictive financial covenants include a maximum ratio of total debt to total asset value, a minimum fixed-charge coverage ratio, a minimum unsecured debt ratio, and a minimum unencumbered asset pool debt service coverage ratio. Noncompliance with one or more of the covenants and restrictions could result in the full or partial principal balance of the associated debt becoming immediately due and payable. We believe we were in compliance with all of our debt covenants as of September 30, 2013. | ||||||||||||||||
Debt Maturities | ||||||||||||||||
The following table summarizes the stated debt maturities and scheduled amortization payments, excluding debt discounts and premiums, as of September 30, 2013: | ||||||||||||||||
Year | (in thousands) | |||||||||||||||
Remaining 2013 | $ | 2,387 | ||||||||||||||
2014 | 265,346 | |||||||||||||||
2015 | 395,104 | |||||||||||||||
2016 | 249,431 | |||||||||||||||
2017 | 71,748 | |||||||||||||||
Thereafter | 1,169,742 | |||||||||||||||
Total (1) | $ | 2,153,758 | ||||||||||||||
________________________ | ||||||||||||||||
-1 | Includes gross principal balance of outstanding debt before impact of net unamortized premiums totaling approximately $8.4 million. | |||||||||||||||
Capitalized Interest and Loan Fees | ||||||||||||||||
The following table sets forth gross interest expense reported in continuing operations, including debt discount/premium and loan cost amortization, net of capitalized interest, for the three and nine months ended September 30, 2013 and 2012. The interest expense capitalized was recorded as a cost of development and redevelopment, and increased the carrying value of undeveloped land and construction in progress. | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(in thousands) | ||||||||||||||||
Gross interest expense | $ | 27,942 | $ | 24,843 | $ | 83,322 | $ | 73,326 | ||||||||
Capitalized interest | (9,089 | ) | (4,989 | ) | (25,301 | ) | (13,154 | ) | ||||||||
Interest expense | $ | 18,853 | $ | 19,854 | $ | 58,021 | $ | 60,172 | ||||||||
Noncontrolling_Interests_on_th
Noncontrolling Interests on the Company's Consolidated Financial Statements | 9 Months Ended |
Sep. 30, 2013 | |
Noncontrolling Interest [Abstract] | |
Noncontrolling Interests on the Company's Consolidated Financial Statements | Noncontrolling Interests on the Company’s Consolidated Financial Statements |
Common Units of the Operating Partnership | |
The Company owned a 97.8%, 97.6% and 97.6% common general partnership interest in the Operating Partnership as of September 30, 2013, December 31, 2012, and September 30, 2012, respectively. The remaining 2.2%, 2.4% and 2.4% common limited partnership interest as of September 30, 2013, December 31, 2012 and September 30, 2012, respectively, was owned by non-affiliate investors and certain of our executive officers and directors in the form of noncontrolling common units. There were 1,821,503, 1,826,503 and 1,826,503 common units outstanding held by these investors, executive officers and directors as of September 30, 2013, December 31, 2012 and September 30, 2012, respectively. | |
The noncontrolling common units may be redeemed by unitholders for cash. We, at our option, may satisfy the cash redemption obligation with shares of the Company’s common stock on a one-for-one basis. Whether satisfied in cash or shares of the Company’s common stock, the value for each noncontrolling common unit upon redemption is the amount equal to the average of the closing quoted price per share of the Company’s common stock, par value $.01 per share, as reported on the NYSE for the ten trading days immediately preceding the applicable redemption date. The aggregate value upon redemption of the then-outstanding noncontrolling common units was $92.3 million and $85.4 million as of September 30, 2013 and December 31, 2012, respectively. This redemption value does not necessarily represent the amount that would be distributed with respect to each noncontrolling common unit in the event of our termination or liquidation. In the event of our termination or liquidation, it is expected in most cases that each common unit would be entitled to a liquidating distribution equal to the liquidating distribution payable in respect of each share of the Company’s common stock. | |
Noncontrolling Interest in Consolidated Subsidiary | |
The noncontrolling interest in consolidated subsidiary represents the third party equity interest in Redwood City Partners, LLC (see Note 2). This noncontrolling interest was $4.9 million at September 30, 2013. |
Stockholders_Equity_of_the_Com
Stockholders' Equity of the Company | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Equity [Abstract] | ||||||||
Stockholders' Equity of the Company | Stockholders’ Equity of the Company | |||||||
Issuance of Common Stock | ||||||||
In September 2013, the Company completed an underwritten public offering of 6,175,000 shares of its common stock. The net offering proceeds, after deducting underwriting discounts and commissions and offering expenses, were approximately $295.9 million. The net proceeds will be used for general corporate purposes, which may include acquiring properties (including office properties and undeveloped land), funding development and redevelopment projects, and repaying indebtedness, which may include borrowings under the operating partnership’s revolving credit facility and term loan facility. | ||||||||
At-The-Market Stock Offering Program | ||||||||
Under our at-the-market stock offering program, which commenced in July 2011, we may offer and sell shares of our common stock having an aggregate gross sales price of up to $200.0 million from time to time in “at-the-market” offerings. The following table sets forth information regarding sales of our common stock under our at-the-market offering program for the three and nine months ended September 30, 2013: | ||||||||
Three Months Ended September 30, 2013 | Nine Months Ended September 30, 2013 | |||||||
(in millions, except share and per share data) | ||||||||
Common shares sold during the period | 226,430 | 1,040,838 | ||||||
Weighted average price per common share | $ | 51.12 | $ | 53.11 | ||||
Aggregate gross proceeds | $ | 11.6 | $ | 55.3 | ||||
Aggregate net proceeds after sales agent compensation | $ | 11.4 | $ | 54.4 | ||||
The proceeds from the sales were used to fund development and redevelopment expenditures and general corporate purposes. Since commencement of the program, we have sold 2,183,261 shares of common stock having an aggregate gross sales price of $105.3 million. As of September 30, 2013, shares of common stock having an aggregate gross sales price of up to $94.7 million remain available to be sold under this program. Actual future sales will depend upon a variety of factors including but not limited to market conditions, the trading price of the Company’s common stock and our capital needs. We have no obligation to sell the remaining shares available for sale under this program. |
Partners_Capital_of_the_Operat
Partners' Capital of the Operating Partnership | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Partners' Capital Notes [Abstract] | |||||||||
Common Units of the Operating Partnership | Partners’ Capital of the Operating Partnership | ||||||||
Issuance of Common Units | |||||||||
In September 2013, the Company completed an underwritten public offering of 6,175,000 shares of its common stock (see Note 7. The net offering proceeds of approximately $295.9 million were contributed by the Company to the Operating Partnership in exchange for 6,175,000 common units. | |||||||||
During the three and nine months ended September 30, 2013, the Company utilized its at-the-market stock offering program to issue 226,430 and 1,040,838 shares of common stock, respectively (see Note 7. The net offering proceeds for the three and nine months ended September 30, 2013 of approximately $11.4 million and $54.4 million, respectively, were contributed by the Company to the Operating Partnership in exchange for 226,430 and 1,040,838 common units, respectively. | |||||||||
Common Units Outstanding | |||||||||
The following table sets forth the number of common units held by the Company and the number of common units held by non-affiliate investors and certain of our executive officers and directors in the form of noncontrolling common units as well as the ownership interest held on each respective date: | |||||||||
September 30, 2013 | December 31, 2012 | September 30, 2012 | |||||||
Company owned common units in the Operating Partnership | 82,113,491 | 74,926,981 | 74,692,939 | ||||||
Company owned general partnership interest | 97.8 | % | 97.6 | % | 97.6 | % | |||
Noncontrolling common units of the Operating Partnership | 1,821,503 | 1,826,503 | 1,826,503 | ||||||
Ownership interest of noncontrolling interest | 2.2 | % | 2.4 | % | 2.4 | % | |||
For a further discussion of the noncontrolling common units as of September 30, 2013 and December 31, 2012, refer to Note 6. |
ShareBased_Compensation
Share-Based Compensation | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||
Share-Based Compensation | Share-Based Compensation | |||||||||||||
Stockholder Approved Equity Compensation Plans | ||||||||||||||
As of September 30, 2013, we maintained one share-based incentive compensation plan, the Kilroy Realty 2006 Incentive Award Plan as amended (the “2006 Plan”). As of September 30, 2013, 28,355 shares were available for grant under the 2006 Plan. The number of shares that remains available for grant is calculated using the weighted share counting provisions set forth in the 2006 Plan, which are based on the type of awards that are granted. The maximum number of shares available for grant subject to full value awards (which generally include equity awards other than options and stock appreciation rights) was 9,711 shares as of September 30, 2013. | ||||||||||||||
On April 4, 2013, the Executive Compensation Committee of the Company’s Board of Directors granted 19,084 RSUs to the Company’s Chief Operating Officer as part of his modified employment agreement. Fifty-percent of the RSUs granted are scheduled to vest in six equal annual installments beginning on December 31, 2013 through December 31, 2018. The grant date fair value of these time-based RSUs was $0.5 million, which was based on the $53.05 closing share price of the Company’s common stock on the New York Stock Exchange on the grant date. Compensation expense will be recognized on a straight-line basis over the service vesting period for these time-based RSUs. The remaining 50% of the RSUs granted are scheduled to vest in six equal annual installments for each calendar year during 2013 through 2018 based on the achievement of certain absolute or relative total shareholder return goals measured annually or, if neither of the shareholder return hurdles are achieved for an applicable year during the performance period, those RSUs will remain eligible to vest in a subsequent year (ending in 2018) based on the achievement of a cumulative total shareholder return goal. The grant date fair value of these market measure-based RSUs was $0.4 million and was calculated using a Monte Carlo simulation pricing model based on the assumptions in the table below. The grant date fair value is allocated among each of the six annual vesting tranches for these market measure-based RSUs and compensation expense will be recognized over the service vesting period using the accelerated expense attribution method. | ||||||||||||||
The computation of expected volatility is based on a blend of the historical volatility of our shares of common stock over 12 years as that is expected to be most consistent with future volatility and equates to a time period twice as long as the six year term of the RSUs and implied volatility data based on the observed pricing of six month publicly-traded options on our shares of common stock. The risk-free interest rate is based on the yield curve on zero-coupon U.S. Treasury STRIP securities in effect at the grant date. The expected dividend yield is estimated by examining the average of the historical dividend yield levels over the six year term of the RSUs and our current annualized dividend yield as of the grant date. The expected life of the RSUs is equal to the six year vesting period. | ||||||||||||||
April 2013 Market-Measure based RSU Grant | ||||||||||||||
Grant date fair value per share | $44.55 | |||||||||||||
Expected share price volatility | 27.00% | |||||||||||||
Risk-free interest rate | 0.90% | |||||||||||||
Dividend yield | 3.60% | |||||||||||||
Expected life | 6 years | |||||||||||||
On April 4, 2013, the terms of 61,327 time-based RSUs granted to certain officers of the Company in January 2013 were modified to include market and performance-based vesting requirements based on certain total shareholder return and FFO per share targets. The RSUs will vest in five equal annual installments over the five-years requisite service period based on the achievement of certain absolute or relative total shareholder return goals measured annually or, if neither of the shareholder return hurdles are achieved for an applicable year during the performance period, those RSUs will remain eligible to vest in a subsequent year (ending in 2018) based on the achievement of a cumulative total shareholder return goal, as well as (in each case) continued employment through the applicable vesting date. The Company’s closing stock price on the date of modification was $53.05. The compensation expense related to the modified RSUs will be recognized using the accelerated attribution expense method through the remainder of the five-year requisite service period. | ||||||||||||||
On March 30, 2012, the Executive Compensation Committee of the Company’s Board of Directors granted 103,239 RSUs to the Company’s Chief Executive Officer. The RSUs granted vest in seven equal annual installments for each calendar year during 2012 through 2018 based on the achievement of certain absolute or relative total shareholder return goals measured annually or, if neither of the shareholder return hurdles are achieved for an applicable year during the performance period, those RSUs will remain eligible to vest in a subsequent year (ending in 2018) based on the achievement of a cumulative total shareholder return goal, as well as (in each case) continued employment through the applicable vesting date. | ||||||||||||||
Summary of Market-Measure Based RSUs | ||||||||||||||
A summary of our market-measure based RSU activity from January 1, 2013 through September 30, 2013 is presented below: | ||||||||||||||
Nonvested RSUs | Vested RSUs | Total RSUs | ||||||||||||
Amount | Weighted-Average | |||||||||||||
Grant Date | ||||||||||||||
Fair Value | ||||||||||||||
Per Share | ||||||||||||||
Outstanding at January 1, 2013 | 88,491 | $ | 41.2 | 14,748 | 103,239 | |||||||||
Granted | 9,542 | 44.55 | — | 9,542 | ||||||||||
Vested | — | — | — | — | ||||||||||
Settled | — | — | — | |||||||||||
Issuance of dividend equivalents | — | — | — | |||||||||||
Modified from time based (1) | 61,327 | 53.05 | — | 61,327 | ||||||||||
Canceled | — | — | ||||||||||||
Outstanding as of September 30, 2013 | 159,360 | $ | 45.96 | 14,748 | 174,108 | |||||||||
_______________ | ||||||||||||||
-1 | On April 4, 2013 the terms of time-based RSU’s granted to certain officers of the Company in January were modified to include market-measure and performance-based vesting requirements. | |||||||||||||
A summary of our market-measure based RSU activity for the nine months ended September 30, 2013 and 2012 is presented below: | ||||||||||||||
RSUs Granted | RSUs Vested | |||||||||||||
Nine months ended September 30, | Non-Vested | Weighted-Average Grant Date | Vested RSUs | Total Vest-Date Fair Value | ||||||||||
RSUs Issued | Fair Value | (in thousands) | ||||||||||||
Per Share | ||||||||||||||
2013 | 9,542 | $ | 44.55 | — | $ | — | ||||||||
2012 | 103,239 | 41.2 | — | — | ||||||||||
Summary of Time-Based RSUs | ||||||||||||||
A summary of our time-based RSU activity from January 1, 2013 through September 30, 2013 is presented below: | ||||||||||||||
Nonvested RSUs | Vested RSUs | Total RSUs | ||||||||||||
Amount | Weighted-Average | |||||||||||||
Grant Date | ||||||||||||||
Fair Value | ||||||||||||||
Per Share | ||||||||||||||
Outstanding at January 1, 2013 | 279,102 | $ | 41.3 | 769,761 | 1,048,863 | |||||||||
Granted, net of forfeitures | 173,758 | 49.45 | — | 173,758 | ||||||||||
Vested | (73,574 | ) | 38.8 | 73,574 | — | |||||||||
Settled (1) | (10,342 | ) | (10,342 | ) | ||||||||||
Issuance of dividend equivalents (2) | 20,421 | 20,421 | ||||||||||||
Modified to market-measure based (3) | (61,327 | ) | 53.05 | — | (61,327 | ) | ||||||||
Canceled (1)(4) | (3,800 | ) | (3,800 | ) | ||||||||||
Outstanding as of September 30, 2013 | 317,959 | $ | 46.13 | 849,614 | 1,167,573 | |||||||||
_______________ | ||||||||||||||
-1 | Represents vested RSUs that are settled in cash or shares of the Company’s common stock. | |||||||||||||
-2 | RSUs issued as dividend equivalents are vested upon issuance. | |||||||||||||
-3 | During the second quarter the terms of time-based RSUs granted to certain officers of the Company in January were modified to include market-measure based vesting requirements. | |||||||||||||
-4 | We accept the return of RSUs, at the current quoted closing share price of the Company’s common stock, to satisfy minimum statutory tax-withholding requirements related to either the issuance, vesting or settlement of RSUs in accordance with the terms of the 2006 Plan. | |||||||||||||
A summary of our time-based RSU activity for the nine months ended September 30, 2013 and 2012 is presented below: | ||||||||||||||
RSUs Granted | RSUs Vested | |||||||||||||
Nine months ended September 30, | Non-Vested | Weighted-Average Grant Date | Vested RSUs | Total Vest-Date Fair Value (1) | ||||||||||
RSUs Issued | Fair Value | (in thousands) | ||||||||||||
Per Share | ||||||||||||||
2013 | 173,758 | $ | 49.45 | (73,574 | ) | $ | 3,677 | |||||||
2012 | 204,829 | 44.34 | (58,940 | ) | 2,420 | |||||||||
_______________ | ||||||||||||||
-1 | Total fair value of RSUs vested was calculated based on the quoted closing share price of the Company’s common stock on the NYSE on the day of vesting. | |||||||||||||
Summary of Nonvested Restricted Stock | ||||||||||||||
A summary of our nonvested restricted stock activity from January 1, 2013 through September 30, 2013 is presented below: | ||||||||||||||
Non-Vested | Weighted-Average | |||||||||||||
Restricted Stock | Grant Date | |||||||||||||
Fair Value | ||||||||||||||
Per Share | ||||||||||||||
Outstanding at January 1, 2013 | 95,241 | $ | 40.42 | |||||||||||
Granted | — | — | ||||||||||||
Vested (1) | (47,291 | ) | 39.12 | |||||||||||
Outstanding as of September 30, 2013 | 47,950 | $ | 41.71 | |||||||||||
_______________ | ||||||||||||||
-1 | The total shares vested include 20,880 shares that were tendered in accordance with the terms of the 2006 Plan to satisfy minimum statutory tax withholding requirements related to the restricted shares that have vested. We accept the return of shares at the current quoted closing share price of the Company’s common stock to satisfy tax obligations. | |||||||||||||
A summary of our nonvested and vested restricted stock activity for the nine months ended September 30, 2013 and 2012 is presented below: | ||||||||||||||
Shares Granted | Shares Vested | |||||||||||||
Nine months ended September 30, | Non-Vested | Weighted-Average Grant Date | Vested Shares | Total Fair Value at Vest Date(1) | ||||||||||
Shares Issued | Fair Value | (in thousands) | ||||||||||||
Per Share | ||||||||||||||
2013 | — | $ | — | (47,291 | ) | $ | 2,290 | |||||||
2012 | 62,137 | 41.84 | (35,623 | ) | 1.388 | |||||||||
_______________ | ||||||||||||||
-1 | Total fair value of shares vested was calculated based on the quoted closing share price of the Company’s common stock on the NYSE on the date of vesting. | |||||||||||||
Summary of Stock Options | ||||||||||||||
A summary of our stock option activity from January 1, 2013 through September 30, 2013 is presented below: | ||||||||||||||
Number of Options | Exercise Price | Remaining Contractual Term (years) | ||||||||||||
Outstanding at January 1, 2013 | 1,540,000 | $ | 42.61 | |||||||||||
Granted | — | — | ||||||||||||
Exercised | (3,000 | ) | 42.61 | |||||||||||
Forfeited | (12,000 | ) | 42.61 | |||||||||||
Outstanding at September 30, 2013 (1)(2) | 1,525,000 | $ | 42.61 | 8.4 | ||||||||||
_______________ | ||||||||||||||
-1 | As of September 30, 2013, 305,000 of the outstanding stock options were exercisable. | |||||||||||||
-2 | The total intrinsic value of options outstanding at September 30, 2013 was $11.2 million. | |||||||||||||
Share-based Compensation Cost Recorded During the Period | ||||||||||||||
The total compensation cost for all share-based compensation programs was $2.5 million and $2.4 million for the three months ended September 30, 2013 and 2012, respectively, and $7.2 million and $6.2 million for the nine months ended September 30, 2013 and 2012, respectively. Of the total share-based compensation costs, $0.2 million and $0.2 million was capitalized as part of real estate assets for the three months ended September 30, 2013 and 2012, respectively, and $0.6 million and $0.7 million for the | ||||||||||||||
nine months ended September 30, 2013 and 2012, respectively. As of September 30, 2013, there was approximately $27.9 million of total unrecognized compensation cost related to nonvested incentive awards granted under share-based compensation arrangements that is expected to be recognized over a weighted-average period of 2.3 years. The remaining compensation cost related to these nonvested incentive awards had been recognized in periods prior to September 30, 2013. |
Commitments_and_Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2013 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies |
General | |
As of September 30, 2013, we had commitments of approximately $447.7 million, excluding our ground lease commitments, for contracts and executed leases directly related to our operating and redevelopment properties. However, this amount includes the $27.5 million that we expect to pay during the fourth quarter of 2013 upon the closing of the purchase of the land underlying the ground lease at 360 Third Street in San Francisco, California. We exercised an option to acquire the land during the fourth quarter of 2012. | |
Environmental Matters | |
We follow the policy of monitoring our properties for the presence of hazardous or toxic substances. While there can be no assurance that a material environmental liability does not exist, we are not currently aware of any environmental liability with respect to the properties that would have a material adverse effect on our financial condition, results of operations, and cash flow. Further, we are not aware of any environmental liability or any unasserted claim or assessment with respect to an environmental liability that we believe would require additional disclosure or the recording of a loss contingency. | |
Property Damage Settlement | |
During the nine months ended September 30, 2013, we settled an outstanding matter related to property damage at one of our properties. In connection with this settlement, we received a cash payment of $5.2 million and recognized this amount in other property income during the nine months ended September 30, 2013. | |
Settlement with Prior Tenant | |
During the three months ended September 30, 2013, we settled an outstanding matter with a prior tenant at one of the properties disposed of in December 2012. In connection with this settlement, we received a net cash payment of $3.7 million, which is presented in Income from discontinued operations in our consolidated statements of operations for the three and nine months ended September 30, 2013. |
Fair_Value_Measurements_and_Di
Fair Value Measurements and Disclosures | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||
Fair Value Measurements and Disclosures | Fair Value Measurements and Disclosures | |||||||||||||||
Assets and Liabilities Reported at Fair Value | ||||||||||||||||
The only assets we record at fair value on a recurring basis on our consolidated financial statements are the marketable securities related to our deferred compensation plan. The following table sets forth the fair value of our marketable securities as of September 30, 2013 and December 31, 2012: | ||||||||||||||||
Fair Value (Level 1) (1) | ||||||||||||||||
September 30, 2013 | December 31, 2012 | |||||||||||||||
Description | (in thousands) | |||||||||||||||
Marketable securities (2) | $ | 9,192 | $ | 7,435 | ||||||||||||
_______________ | ||||||||||||||||
-1 | Based on quoted prices in active markets for identical securities. | |||||||||||||||
-2 | The marketable securities are held in a limited rabbi trust. | |||||||||||||||
We report the change in the fair value of the marketable securities at the end of each accounting period in interest income and other net investment gains in the consolidated statements of operations. We adjust the related deferred compensation plan liability to fair value at the end of each accounting period based on the performance of the benchmark funds selected by each participant, which results in a corresponding increase or decrease to compensation cost for the period. | ||||||||||||||||
The following table sets forth the net gain on marketable securities recorded during the three and nine months ended September 30, 2013 and 2012: | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Description | (in thousands) | |||||||||||||||
Net gain on marketable securities | $ | 669 | $ | 315 | $ | 995 | $ | 595 | ||||||||
Financial Instruments Disclosed at Fair Value | ||||||||||||||||
The following table sets forth the carrying value and the fair value of our other financial instruments as of September 30, 2013 and December 31, 2012: | ||||||||||||||||
September 30, 2013 | December 31, 2012 | |||||||||||||||
Carrying | Fair | Carrying | Fair | |||||||||||||
Value | Value | Value | Value | |||||||||||||
(in thousands) | ||||||||||||||||
Liabilities | ||||||||||||||||
Secured debt (1) | $ | 563,898 | $ | 574,661 | $ | 561,096 | $ | 591,993 | ||||||||
Exchangeable senior notes, net (1) | 167,236 | 178,379 | 163,944 | 181,223 | ||||||||||||
Unsecured debt, net (2) | 1,431,048 | 1,522,228 | 1,130,895 | 1,254,047 | ||||||||||||
Unsecured line of credit (1) | — | — | 185,000 | 185,049 | ||||||||||||
_______________ | ||||||||||||||||
-1 | Fair value calculated using Level II inputs which are based on model-derived valuations in which significant inputs and significant value drivers are observable in active markets. | |||||||||||||||
-2 | Fair value calculated using Level I and Level II inputs. Level I inputs are based on quoted prices for identical instruments in active markets. The carrying value and fair value of the Level I instruments was $841.9 million and $932.2 million, respectively, as of September 30, 2013. The carrying value and fair value of the Level I instruments at December 31, 2012, was $573.3 million and $653.0 million, respectively. The carrying value and fair value of the Level II instruments was $589.2 million and $590.0 million, respectively, as of September 30, 2013. The carrying value and fair value of the Level II instruments at December 31, 2012, was $557.6 million and $601.0 million, respectively. |
Discontinued_Operations
Discontinued Operations | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Discontinued Operations and Disposal Groups [Abstract] | ||||||||||||||||
Discontinued Operations | Discontinued Operations | |||||||||||||||
Dispositions | ||||||||||||||||
The following table summarizes the property sold during the nine months ended September 30, 2013: | ||||||||||||||||
Location | Property Type | Month of Disposition | Number of Buildings | Rentable | Sales Price | |||||||||||
Square Feet | (in millions) | |||||||||||||||
26541 Agoura Road, Calabasas, CA | Office | June | 1 | 90,156 | $ | 14.7 | ||||||||||
Properties Held for Sale | ||||||||||||||||
As of September 30, 2013, the following properties were classified as held for sale: | ||||||||||||||||
Location | City/Submarket | Property Type | Number of Buildings | Rentable Square Feet | ||||||||||||
San Diego Properties, San Diego, CA (1) | I-15 Corridor/Sorrento Mesa | Office | 13 | 1,099,395 | ||||||||||||
8101 Kaiser Boulevard, Anaheim, CA (2) | Anaheim | Office | 1 | 59,790 | ||||||||||||
Total properties held for sale | 14 | 1,159,185 | ||||||||||||||
________________________ | ||||||||||||||||
-1 | The San Diego Properties included the following: 4910 Directors Place, 10020 Pacific Mesa Boulevard, 6055 Lusk Avenue, 5010 and 5005 Wateridge Vista Drive, 15435 and 15445 Innovation Drive, and 15051, 15073, 15231, 15253, 15333 and 15378 Avenue of Science. | |||||||||||||||
-2 | We closed on the disposition of this property on October 2, 2013. The sales price was $9.6 million. | |||||||||||||||
The major classes of assets and liabilities of the properties held for sale as of September 30, 2013 were as follows: | ||||||||||||||||
Real estate assets and other assets held for sale | (in thousands) | |||||||||||||||
Land and improvements | $ | 54,273 | ||||||||||||||
Buildings and improvements | 236,792 | |||||||||||||||
Undeveloped land and construction in progress | 1,441 | |||||||||||||||
Total real estate held for sale | 292,506 | |||||||||||||||
Accumulated depreciation | (70,084 | ) | ||||||||||||||
Total real estate held for sale, net | 222,422 | |||||||||||||||
Current receivables, net | 303 | |||||||||||||||
Deferred rent receivables, net | 9,062 | |||||||||||||||
Deferred leasing costs and acquisition-related intangible assets, net | 6,643 | |||||||||||||||
Prepaid expenses and other assets, net | 981 | |||||||||||||||
Real estate and other assets held for sale, net | $ | 239,411 | ||||||||||||||
Liabilities and deferred revenue of real estate assets held for sale | ||||||||||||||||
Accounts payable and other liabilities | $ | 2,554 | ||||||||||||||
Deferred revenue and acquisition-related intangible liabilities, net | 12,785 | |||||||||||||||
Rents received in advance and tenant security deposits | 1,412 | |||||||||||||||
Liabilities and deferred revenue of real estate assets held for sale | $ | 16,751 | ||||||||||||||
Discontinued Operations | ||||||||||||||||
For the three and nine months ended September 30, 2013 and 2012, discontinued operations included the income of all properties sold and classified as held for sale during the nine months ended September 30, 2013. For the three and nine months ended September 30, 2012, discontinued operations also included the income of seven office buildings and our industrial portfolio that were sold in 2012. The following table summarizes the revenue and expense components that comprise Income from discontinued operations for the three and nine months ended September 30, 2013 and 2012: | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(in thousands) | ||||||||||||||||
Revenues: | ||||||||||||||||
Rental income | $ | 6,604 | $ | 10,522 | $ | 18,334 | $ | 33,105 | ||||||||
Tenant reimbursements | 892 | 1,639 | 2,331 | 5,296 | ||||||||||||
Other property income | 4,610 | 229 | 4,617 | 884 | ||||||||||||
Total revenues | 12,106 | 12,390 | 25,282 | 39,285 | ||||||||||||
Expenses: | ||||||||||||||||
Property expenses | 2,020 | 2,044 | 3,920 | 6,287 | ||||||||||||
Real estate taxes | 684 | 1,301 | 2,048 | 3,719 | ||||||||||||
Provision for bad debts | (23 | ) | (194 | ) | (23 | ) | (194 | ) | ||||||||
Depreciation and amortization | 3,081 | 4,550 | 8,531 | 13,870 | ||||||||||||
Total expenses | 5,762 | 7,701 | 14,476 | 23,682 | ||||||||||||
Income from discontinued operations before net gain on dispositions | 6,344 | 4,689 | 10,806 | 15,603 | ||||||||||||
of discontinued operations | ||||||||||||||||
Net gain on dispositions of discontinued operations | — | — | 423 | 72,809 | ||||||||||||
Total income from discontinued operations | $ | 6,344 | $ | 4,689 | $ | 11,229 | $ | 88,412 | ||||||||
Net_Loss_Income_Available_to_C
Net (Loss) Income Available to Common Stockholders Per Share of the Company | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Earnings Per Share [Abstract] | ||||||||||||||||
Net Income Available to Common Stockholders Per Share of the Company | Net Income (Loss) Available to Common Stockholders Per Share of the Company | |||||||||||||||
The following table reconciles the numerator and denominator in computing the Company’s basic and diluted per-share computations for net income (loss) available to common stockholders for the three and nine months ended September 30, 2013 and 2012: | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(in thousands, except share and | ||||||||||||||||
per share amounts) | ||||||||||||||||
Numerator: | ||||||||||||||||
Income (loss) from continuing operations | $ | 2,683 | $ | (2,167 | ) | $ | 10,289 | $ | (4,941 | ) | ||||||
Loss (income) from continuing operations attributable to | 14 | 179 | (8 | ) | 564 | |||||||||||
noncontrolling common units of the Operating Partnership | ||||||||||||||||
Preferred distributions and dividends | (3,312 | ) | (5,342 | ) | (9,938 | ) | (17,775 | ) | ||||||||
Allocation to participating securities (1) | (450 | ) | (408 | ) | (1,292 | ) | (1,225 | ) | ||||||||
Numerator for basic and diluted loss from continuing | (1,065 | ) | (7,738 | ) | (949 | ) | (23,377 | ) | ||||||||
operations available to common stockholders | ||||||||||||||||
Income from discontinued operations | 6,344 | 4,689 | 11,229 | 88,412 | ||||||||||||
Income from discontinued operations attributable to | (145 | ) | (112 | ) | (258 | ) | (2,272 | ) | ||||||||
noncontrolling common units of the Operating Partnership | ||||||||||||||||
Numerator for basic and diluted net income (loss) | $ | 5,134 | $ | (3,161 | ) | $ | 10,022 | $ | 62,763 | |||||||
available to common stockholders | ||||||||||||||||
Denominator: | ||||||||||||||||
Basic weighted average vested shares outstanding | 76,768,893 | 71,889,475 | 75,750,822 | 67,975,309 | ||||||||||||
Effect of dilutive securities – contingently issuable shares | — | — | — | — | ||||||||||||
and stock options | ||||||||||||||||
Diluted weighted average vested shares and common share | 76,768,893 | 71,889,475 | 75,750,822 | 67,975,309 | ||||||||||||
equivalents outstanding | ||||||||||||||||
Basic earnings per share: | ||||||||||||||||
Loss from continuing operations available to common | $ | (0.01 | ) | $ | (0.10 | ) | $ | (0.01 | ) | $ | (0.34 | ) | ||||
stockholders per share | ||||||||||||||||
Income from discontinued operations per common share | 0.08 | 0.06 | 0.14 | 1.26 | ||||||||||||
Net income (loss) available to common stockholders per share | $ | 0.07 | $ | (0.04 | ) | $ | 0.13 | $ | 0.92 | |||||||
Diluted earnings per share: | ||||||||||||||||
Loss from continuing operations available to common | $ | (0.01 | ) | $ | (0.10 | ) | $ | (0.01 | ) | $ | (0.34 | ) | ||||
stockholders per share | ||||||||||||||||
Income from discontinued operations per common share | 0.08 | 0.06 | 0.14 | 1.26 | ||||||||||||
Net income (loss) available to common stockholders per share | $ | 0.07 | $ | (0.04 | ) | $ | 0.13 | $ | 0.92 | |||||||
________________________ | ||||||||||||||||
-1 | Participating securities include nonvested shares, time-based RSUs and vested market-measure RSUs. | |||||||||||||||
The impact of the contingently issuable shares, which consist of 159,360 market measure-based RSUs, the 4.25% Exchangeable Notes and 1,525,000 stock options, were not considered in our diluted earnings per share calculation for the three and nine months ended September 30, 2013 because we reported a loss from continuing operations attributable to common stockholders in the respective period and the effect was anti-dilutive. The impact of the contingently issuable shares, which consisted of 103,238 market measure-based RSUs, the Exchangeable Notes and 1,540,000 stock options was not considered in our diluted earnings per share calculation for the three and nine months ended September 30, 2012 because we reported a loss from continuing operations attributable to common stockholders and the effect was anti-dilutive. See Note 5 for additional information regarding the Exchangeable Notes and Note 9 for additional information regarding the outstanding market measure-based RSUs and stock options. |
Net_Loss_Income_Available_to_C1
Net (Loss) Income Available to Common Unitholders Per Unit of the Operating Partnership | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Earnings Per Unit [Abstract] | ||||||||||||||||
Net (Loss) Income Available to Common Unitholders per Unit of the Operating Partnership | Net Income (Loss) Available to Common Unitholders Per Unit of the Operating Partnership | |||||||||||||||
The following table reconciles the numerator and denominator in computing the Operating Partnership’s basic and diluted per-unit computations for net income (loss) available to common unitholders for the three and nine months ended September 30, 2013 and 2012: | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(in thousands, except unit and | ||||||||||||||||
per unit amounts) | ||||||||||||||||
Numerator: | ||||||||||||||||
Income (loss) from continuing operations | $ | 2,683 | $ | (2,167 | ) | $ | 10,289 | $ | (4,941 | ) | ||||||
Income from continuing operations attributable to | (47 | ) | (48 | ) | (178 | ) | (144 | ) | ||||||||
noncontrolling interests in consolidated subsidiaries | ||||||||||||||||
Preferred distributions | (3,312 | ) | (5,342 | ) | (9,938 | ) | (17,775 | ) | ||||||||
Allocation to participating securities (1) | (450 | ) | (408 | ) | (1,292 | ) | (1,225 | ) | ||||||||
Numerator for basic and diluted loss from continuing | (1,126 | ) | (7,965 | ) | (1,119 | ) | (24,085 | ) | ||||||||
operations available to common unitholders | ||||||||||||||||
Income from discontinued operations | 6,344 | 4,689 | 11,229 | 88,412 | ||||||||||||
Numerator for basic and diluted net income (loss) available | $ | 5,218 | $ | (3,276 | ) | $ | 10,110 | $ | 64,327 | |||||||
to common unitholders | ||||||||||||||||
Denominator: | ||||||||||||||||
Basic weighted average vested units outstanding | 78,590,396 | 73,680,259 | 77,574,907 | 69,717,834 | ||||||||||||
Effect of dilutive securities - contingently issuable shares | — | — | — | — | ||||||||||||
and stock options | ||||||||||||||||
Diluted weighted average vested units and common unit | 78,590,396 | 73,680,259 | 77,574,907 | 69,717,834 | ||||||||||||
equivalents outstanding | ||||||||||||||||
Basic earnings per unit: | ||||||||||||||||
Loss from continuing operations available to common | $ | (0.01 | ) | $ | (0.10 | ) | $ | (0.01 | ) | $ | (0.34 | ) | ||||
unitholders per unit | ||||||||||||||||
Income from discontinued operations per common unit | 0.08 | 0.06 | 0.14 | 1.26 | ||||||||||||
Net income (loss) available to common unitholders per unit | $ | 0.07 | $ | (0.04 | ) | $ | 0.13 | $ | 0.92 | |||||||
Diluted earnings per unit: | ||||||||||||||||
Loss from continuing operations available to common | $ | (0.01 | ) | $ | (0.10 | ) | $ | (0.01 | ) | $ | (0.34 | ) | ||||
unitholders per unit | ||||||||||||||||
Income from discontinued operations per common unit | 0.08 | 0.06 | 0.14 | 1.26 | ||||||||||||
Net income (loss) available to common unitholders per unit | $ | 0.07 | $ | (0.04 | ) | $ | 0.13 | $ | 0.92 | |||||||
________________________ | ||||||||||||||||
-1 | Participating securities include nonvested shares, time-based RSUs and vested market-measure RSUs. | |||||||||||||||
The impact of the contingently issuable units, which consist of 159,360 market measure-based RSUs, the 4.25% Exchangeable Notes and 1,525,000 stock options, were not considered in our diluted earnings per unit calculation for the three and nine months ended September 30, 2013 because the Operating Partnership reported a loss from continuing operations attributable to common unitholders in the respective periods and the effect was anti-dilutive. The impact of the contingently issuable units, which consisted of 103,238 market measure-based RSUs, the Exchangeable Notes and 1,540,000 stock options was not considered in our diluted earnings per unit calculation for the three and nine months ended September 30, 2012 because the Operating Partnership reported a loss from continuing operations attributable to common unitholders and the effect was anti-dilutive. See Note 5 for additional information regarding the Exchangeable Notes and Note 9 for additional information regarding the outstanding market measure-based RSUs and stock options. |
Subsequent_Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2013 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events |
On October 16, 2013, aggregate dividends, distributions, and dividend equivalents of $29.8 million were paid to common stockholders and common unitholders of record on September 30, 2013 and RSU holders on the payment date. | |
In October 2013, we sold one of our office properties that was held for sale as of September 30, 2013 for $9.6 million. | |
In October 2013, the Company acquired a 2.0 acre undeveloped land parcel for $17.0 million, completing the final phase of the land assemblage for the Crossing 900 project located in Redwood City, California. |
Organization_and_Basis_of_Pres1
Organization and Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2013 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Consolidation Policy | The consolidated financial statements of the Company include the consolidated financial position and results of operations of the Company, the Operating Partnership, the Finance Partnership, KSLLC, Redwood City Partners, LLC and all of our wholly-owned and controlled subsidiaries. The consolidated financial statements of the Operating Partnership include the consolidated financial position and results of operations of the Operating Partnership, the Finance Partnership, KSLLC, Redwood City Partners, LLC and all wholly-owned and controlled subsidiaries of the Operating Partnership. All intercompany balances and transactions have been eliminated in the consolidated financial statements. |
Basis of Accounting | The accompanying interim financial statements have been prepared by management in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and in conjunction with the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures required for annual financial statements have been condensed or excluded pursuant to SEC rules and regulations. Accordingly, the interim financial statements do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, the accompanying interim financial statements reflect all adjustments of a normal and recurring nature that are considered necessary for a fair presentation of the results for the interim periods presented. However, the results of operations for the interim periods are not necessarily indicative of the results that may be expected for the year ending December 31, 2013. The interim financial statements for the Company and the Operating Partnership should be read in conjunction with the audited consolidated financial statements and notes thereto included in our annual report on Form 10-K for the year ended December 31, 2012. |
Partially Owned Entities and Variable Interest Entities | Our accounting policy is to consolidate entities in which we have a controlling financial interest and significant decision making control over the entities operations. In determining whether we have a controlling financial interest in a partially owned entity and the requirement to consolidate the accounts of that entity, we consider factors such as ownership interest, board representation, management representation, size of our investment (including loans), authority to control decisions, and contractual and substantive participating rights of the members. In addition to evaluating control rights, we also consolidate entities in which the other member has no substantive kick-out rights to remove the Company as the managing member. |
We also evaluate whether the entity is a variable interest entity (“VIE”) and whether we are the primary beneficiary. VIEs are entities in which the equity investors do not have sufficient equity at risk to finance their endeavors without additional financial support or that the holders of the equity investment at risk do not have a controlling financial interest. We are deemed to be the primary beneficiary of a VIE when we have the power to direct the activities of the VIE that most significantly impact the VIEs economic performance and the obligation to absorb losses or receive benefits that could potentially be significant to the VIE. | |
If the requirements for consolidation are not met, the Company would account for investments under the equity method of accounting if we have the ability to exercise significant influence over the entity. Equity method investments would be initially recorded at cost and subsequently adjusted for our share of net income or loss and cash contributions and distributions each period. The Company did not have any equity method investments at September 30, 2013 or December 31, 2012. | |
As of September 30, 2013, the consolidated financial statements of the Company and the Operating Partnership included two VIEs, in which we were deemed to be the primary beneficiary. One of the VIEs was established on June 27, 2013 (see Note 2 for additional information), and the second VIE was established during the third quarter of 2013 to facilitate a potential like-kind exchange pursuant to Section 1031 of the Code (“Section 1031 Exchanges”) to defer taxable gains on dispositions for federal and state income tax purposes. To realize the tax deferral available under a Section 1031 Exchange, the Company must complete the Section 1031 Exchanges, if any, and complete the sale of the to-be-exchanged properties within 180 days of the acquisition date | |
(see Note 2). The VIE established during the third quarter of 2013 will be terminated upon the completion of the Section 1031 Exchanges or the expiration of the 180 day period, as applicable. The impact of consolidating the VIEs increased the Company’s total assets, liabilities and noncontrolling interests by approximately $135.3 million (of which $119.3 million is related to real estate held for investment on our consolidated balance sheet), $4.1 million and $4.9 million, respectively, at September 30, 2013. | |
As of December 31, 2012, the consolidated financial statements of the Company and the Operating Partnership included two VIEs, in which we were deemed to be the primary beneficiary. The VIEs were established during 2012 to facilitate potential Section 1031 Exchanges to defer taxable gains on dispositions for federal and state income tax purposes. During the year ended December 31, 2012, one operating property and one development project were acquired in two separate transactions and transferred to the two special purpose VIEs to facilitate potential Section 1031 Exchanges. The impact of consolidating the VIEs increased the Company’s total assets and liabilities by approximately $337.0 million (of which $319.8 million is related to real estate held for investment on our consolidated balance sheet) and $111.1 million, respectively, at December 31, 2012. During the three months ended March 31, 2013, the Section 1031 Exchanges were completed and the VIEs were terminated. As a result, $228.3 million of restricted cash set aside at December 31, 2012 to facilitate the Section 1031 Exchanges was released from escrow. |
Organization_and_Basis_of_Pres2
Organization and Basis of Presentation (Tables) | 9 Months Ended | |||||||||||
Sep. 30, 2013 | ||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||||||||
Summary of real estate properties | Our stabilized portfolio of operating properties was comprised of the following office properties at September 30, 2013: | |||||||||||
Number of | Rentable | Number of | Percentage | |||||||||
Buildings | Square Feet | Tenants | Occupied | |||||||||
Stabilized Office Properties (1) | 103 | 12,536,495 | 654 | 92.2 | % | |||||||
______________ | ||||||||||||
-1 | Excludes 13 properties located in San Diego, California and one property in Anaheim, California that were held for sale at September 30, 2013 (see Note 12 “Discontinued Operations”). | |||||||||||
Our stabilized portfolio includes all of our properties with the exception of properties held for sale, undeveloped land, development and redevelopment properties currently under construction or committed for construction, and “lease-up” properties. As of September 30, 2013, our stabilized portfolio of operating properties excluded the 14 properties that were classified as held for sale as of that date. (See Note 12 for additional information). We define redevelopment properties as those projects for which we expect to spend significant development and construction costs on existing or acquired buildings pursuant to a formal plan, the intended result of which is a higher economic return on the property. We define “lease-up” properties as properties we recently developed or redeveloped that have not yet reached 95% occupancy and are within one year following cessation of major construction activities. As of September 30, 2013, the following properties were excluded from our stabilized portfolio: | ||||||||||||
Number of Properties | Estimated Rentable | |||||||||||
Square Feet | ||||||||||||
Properties Held for Sale (1) | 14 | 1,159,185 | ||||||||||
Development properties under construction (2) | 5 | 1,516,000 | ||||||||||
Lease-up properties | 2 | 508,000 | ||||||||||
_______________ | ||||||||||||
-1 | Includes 13 properties located in San Diego, California and one property in Anaheim, California (see Note 12). | |||||||||||
(2) Estimated rentable square feet upon completion. |
Acquisitions_Tables
Acquisitions (Tables) | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
Office Properties Acquisitions [Member] | ||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||
Acquired operating properties from unrelated third parties | During the nine months ended September 30, 2013, we acquired the four operating office properties, listed below, in two transactions from unrelated third parties. The January 2013 acquisition was funded with a portion of the remaining proceeds from the sale of our industrial portfolio that was included in restricted cash at December 31, 2012 and the assumption of existing mortgage debt (see Note 5). The September 2013 acquisition was funded with proceeds from our September 2013 equity offering (see Note 7). | |||||||||||||
Property | Date of Acquisition | Number of | Rentable Square | Occupancy as of September 30, 2013 | Purchase | |||||||||
Buildings | Feet | Price | ||||||||||||
(in millions) (1) | ||||||||||||||
320 Westlake Ave. N. and 321 Terry Ave. N. (2)(3) | ||||||||||||||
Seattle, WA | January 16, 2013 | 2 | 320,398 | 100.00% | $ | 170 | ||||||||
12780 and 12790 El Camino Real (4) | ||||||||||||||
San Diego, CA | September 19, 2013 | 2 | 218,940 | 100.00% | 126.4 | |||||||||
Total | 4 | 539,338 | $ | 296.4 | ||||||||||
_______________ | ||||||||||||||
-1 | Excludes acquisition-related costs and includes assumed tenant improvements. | |||||||||||||
-2 | We acquired these properties through a new special purpose entity wholly owned by the Finance Partnership. | |||||||||||||
-3 | In connection with this acquisition, we assumed secured debt with an outstanding principal balance of $83.9 million that was recorded at fair value on the acquisition date, resulting in a premium of approximately $11.6 million (see Note 5). | |||||||||||||
-4 | As of September 30, 2013, these properties, together the “Heights of Del Mar” project, are temporarily being held in a separate VIE to facilitate potential Section 1031 Exchanges (see Note 1). The $126.4 million purchase price includes $9.4 million for 4.2 acres of undeveloped land the Company acquired in connection with this acquisition. | |||||||||||||
Fair values of assets acquired and liabilities assumed | The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date: | |||||||||||||
Total 2013 | ||||||||||||||
Acquisitions (1) | ||||||||||||||
(in thousands) | ||||||||||||||
Assets | ||||||||||||||
Land and improvements | $ | 53,790 | ||||||||||||
Buildings and improvements (2) | 218,211 | |||||||||||||
Undeveloped land and construction in progress (3) | 9,360 | |||||||||||||
Deferred leasing costs and acquisition-related intangible assets (4) | 30,789 | |||||||||||||
Total assets acquired | 312,150 | |||||||||||||
Liabilities | ||||||||||||||
Deferred revenue and acquisition-related intangible liabilities (5) | 4,190 | |||||||||||||
Secured debt (6) | 95,496 | |||||||||||||
Accounts payable, accrued expenses and other liabilities | 422 | |||||||||||||
Total liabilities assumed | 100,108 | |||||||||||||
Net assets and liabilities acquired (7) | $ | 212,042 | ||||||||||||
_______________ | ||||||||||||||
-1 | The purchase price of the two acquisitions completed during the nine months ended September 30, 2013 were individually less than 5% and in aggregate less than 10% of the Company’s total assets as of September 30, 2013. | |||||||||||||
-2 | Represents buildings, building improvements and tenant improvements. | |||||||||||||
-3 | In connection with one of the acquisitions, we acquired undeveloped land of approximately 4.2 acres that was added to the Company’s future development pipeline upon acquisition. | |||||||||||||
-4 | Represents in-place leases (approximately $19.6 million with a weighted average amortization period of 4.7 years), above-market leases (approximately $3.2 million with a weighted average amortization period of 6.1 years), and leasing commissions (approximately $7.9 million with a weighted average amortization period of 5.9 years). | |||||||||||||
-5 | Represents below-market leases (approximately $4.2 million with a weighted average amortization period of 7.7 years). | |||||||||||||
-6 | Represents the mortgage loan, which includes an unamortized premium of approximately $11.6 million at the date of acquisition, assumed in connection with the properties acquired in January 2013 (see Note 5). | |||||||||||||
-7 | Reflects the purchase price net of assumed secured debt and other lease-related obligations. | |||||||||||||
Redwood City Partners, LLC [Member] | ||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||
Fair values of assets acquired and liabilities assumed | The following table summarizes the allocation of the assets acquired and liabilities assumed at the acquisition date (in thousands): | |||||||||||||
Assets | ||||||||||||||
Undeveloped land and construction in progress | $ | 11,222 | ||||||||||||
Total assets | 11,222 | |||||||||||||
Liabilities | ||||||||||||||
Secured debt (1) | 1,750 | |||||||||||||
Accounts payable, accrued expenses and other liabilities | 1,952 | |||||||||||||
Total liabilities | 3,702 | |||||||||||||
Noncontrolling interest in consolidated subsidiary | 4,885 | |||||||||||||
Net assets and liabilities acquired | $ | 2,635 | ||||||||||||
_______________ | ||||||||||||||
(1) This note was repaid as of September 30, 2013. |
Deferred_Leasing_Costs_and_Acq1
Deferred Leasing Costs and Acquisition-related Intangible Assets and Liabilities, net (Tables) | 9 Months Ended | |||||||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||||||
Intangible Assets and Liabilities Disclosure [Abstract] | ||||||||||||||||||||||||
Summary of identified deferred leasing costs and acquisition-related intangible assets and liabilities [Table Text Block] | The following table summarizes our deferred leasing costs and acquisition-related intangible assets (acquired value of leasing costs, above-market operating leases, in-place leases and below-market ground lease obligation) and intangible liabilities (acquired value of below-market operating leases and above-market ground lease obligation) as of September 30, 2013 and December 31, 2012: | |||||||||||||||||||||||
September 30, 2013 | December 31, 2012 | |||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
Deferred Leasing Costs and Acquisition-related Intangible Assets, net: | ||||||||||||||||||||||||
Deferred leasing costs | $ | 170,609 | $ | 168,087 | ||||||||||||||||||||
Accumulated amortization | (59,943 | ) | (61,443 | ) | ||||||||||||||||||||
Deferred leasing costs, net | 110,666 | 106,644 | ||||||||||||||||||||||
Above-market operating leases | 28,842 | 27,977 | ||||||||||||||||||||||
Accumulated amortization | (14,038 | ) | (12,180 | ) | ||||||||||||||||||||
Above-market operating leases, net | 14,804 | 15,797 | ||||||||||||||||||||||
In-place leases | 108,612 | 101,061 | ||||||||||||||||||||||
Accumulated amortization | (44,476 | ) | (34,019 | ) | ||||||||||||||||||||
In-place leases, net | 64,136 | 67,042 | ||||||||||||||||||||||
Below-market ground lease obligation | 490 | 690 | ||||||||||||||||||||||
Accumulated amortization | (11 | ) | (205 | ) | ||||||||||||||||||||
Below-market ground lease obligation, net | 479 | 485 | ||||||||||||||||||||||
Total deferred leasing costs and acquisition-related intangible assets, net | $ | 190,085 | $ | 189,968 | ||||||||||||||||||||
Acquisition-related Intangible Liabilities, net: (1) | ||||||||||||||||||||||||
Below-market operating leases | $ | 70,966 | $ | 70,486 | ||||||||||||||||||||
Accumulated amortization | (24,074 | ) | (17,555 | ) | ||||||||||||||||||||
Below-market operating leases, net | 46,892 | 52,931 | ||||||||||||||||||||||
Above-market ground lease obligation | 6,320 | 6,320 | ||||||||||||||||||||||
Accumulated amortization | (198 | ) | (122 | ) | ||||||||||||||||||||
Above-market ground lease obligation, net | 6,122 | 6,198 | ||||||||||||||||||||||
Total acquisition-related intangible liabilities, net | $ | 53,014 | $ | 59,129 | ||||||||||||||||||||
_______________ | ||||||||||||||||||||||||
-1 | Included in deferred revenue and acquisition-related intangible liabilities, net in the consolidated balance sheets. | |||||||||||||||||||||||
Schedule Of Finite Lived Intangible Assets and Liabilities Amortization Expense [Table Text Block] | The following table sets forth amortization related to deferred leasing costs and acquisition-related intangibles, including amounts attributable to discontinued operations, for the three and nine months ended September 30, 2013 and 2012: | |||||||||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
Deferred leasing costs (1) | $ | 6,945 | $ | 5,238 | $ | 20,882 | $ | 14,126 | ||||||||||||||||
Above-market operating leases (2) | 1,417 | 1,459 | 4,214 | 4,205 | ||||||||||||||||||||
In-place leases (1) | 7,677 | 6,479 | 22,546 | 14,858 | ||||||||||||||||||||
Below-market ground lease obligation (3) | 2 | 52 | 6 | 153 | ||||||||||||||||||||
Below-market operating leases (4) | (3,355 | ) | (3,487 | ) | (10,229 | ) | (8,821 | ) | ||||||||||||||||
Above-market ground lease obligation (5) | (25 | ) | (25 | ) | (76 | ) | (60 | ) | ||||||||||||||||
Total | $ | 12,661 | $ | 9,716 | $ | 37,343 | $ | 24,461 | ||||||||||||||||
_______________ | ||||||||||||||||||||||||
-1 | The amortization of deferred leasing costs and in-place leases is recorded to depreciation and amortization expense in the consolidated statements of operations for the periods presented. | |||||||||||||||||||||||
-2 | The amortization of above-market operating leases is recorded as a decrease to rental income in the consolidated statements of operations for the periods presented. | |||||||||||||||||||||||
-3 | The amortization of the below-market ground lease obligation is recorded as an increase to ground lease expense in the consolidated statements of operations for the periods presented. | |||||||||||||||||||||||
-4 | The amortization of below-market operating leases is recorded as an increase to rental income in the consolidated statements of operations for the periods presented. | |||||||||||||||||||||||
-5 | The amortization of the above-market ground lease obligation is recorded as a decrease to ground lease expense in the consolidated statements of operations for the periods presented. | |||||||||||||||||||||||
ScheduleofFiniteLivedIntangibleAssetsAndLiabilitiesFutureAmortizationExpense [Table Text Block] | The following table sets forth the estimated annual amortization expense related to deferred leasing costs and acquisition-related intangibles as of September 30, 2013 for future periods: | |||||||||||||||||||||||
Year | Deferred Leasing Costs | Above-Market Operating Leases (1) | In-Place Leases | Below-Market Ground Lease Obligation (2) | Below-Market Operating Leases (3) | Above-Market Ground Lease Obligation (4) | ||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
Remaining 2013 | $ | 6,384 | $ | 1,367 | $ | 6,549 | $ | 2 | $ | (3,201 | ) | $ | (25 | ) | ||||||||||
2014 | 23,533 | 4,837 | 19,053 | 8 | (11,903 | ) | (101 | ) | ||||||||||||||||
2015 | 19,669 | 3,035 | 12,676 | 8 | (9,385 | ) | (101 | ) | ||||||||||||||||
2016 | 16,920 | 2,007 | 9,445 | 8 | (7,195 | ) | (101 | ) | ||||||||||||||||
2017 | 14,468 | 1,690 | 7,744 | 8 | (6,127 | ) | (101 | ) | ||||||||||||||||
Thereafter | 29,692 | 1,868 | 8,669 | 445 | (9,081 | ) | (5,693 | ) | ||||||||||||||||
Total | $ | 110,666 | $ | 14,804 | $ | 64,136 | $ | 479 | $ | (46,892 | ) | $ | (6,122 | ) | ||||||||||
_______________ | ||||||||||||||||||||||||
-1 | Represents estimated annual amortization related to above-market operating leases. Amounts will be recorded as a decrease to rental income in the consolidated statements of operations. | |||||||||||||||||||||||
-2 | Represents estimated annual amortization related to below-market ground lease obligations. Amounts will be recorded as an increase to ground lease expense in the consolidated statements of operations. | |||||||||||||||||||||||
-3 | Represents estimated annual amortization related to below-market operating leases. Amounts will be recorded as an increase to rental income in the consolidated statements of operations. | |||||||||||||||||||||||
-4 | Represents estimated annual amortization related to above-market ground lease obligations. Amounts will be recorded as a decrease to ground lease expense in the consolidated statements of operations. |
Receivables_Tables
Receivables (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Receivables [Abstract] | ||||||||
Current Receivables, net | Current receivables, net is primarily comprised of contractual rents and other lease-related obligations due from tenants. The balance consisted of the following as of September 30, 2013 and December 31, 2012: | |||||||
September 30, 2013 (1) | 31-Dec-12 | |||||||
(in thousands) | ||||||||
Current receivables | $ | 14,301 | $ | 11,801 | ||||
Allowance for uncollectible tenant receivables | (2,532 | ) | (2,581 | ) | ||||
Current receivables, net | $ | 11,769 | $ | 9,220 | ||||
_______________ | ||||||||
-1 | Excludes current receivables, net related to properties held for sale at September 30, 2013. | |||||||
Deferred Rent Receivables, net | Deferred rent receivables, net consisted of the following as of September 30, 2013 and December 31, 2012: | |||||||
September 30, 2013 (1) | 31-Dec-12 | |||||||
(in thousands) | ||||||||
Deferred rent receivables | $ | 123,632 | $ | 118,025 | ||||
Allowance for deferred rent receivables | (1,973 | ) | (2,607 | ) | ||||
Deferred rent receivables, net | $ | 121,659 | $ | 115,418 | ||||
_______________ | ||||||||
-1 | Excludes deferred rent receivables, net related to properties held for sale at September 30, 2013. |
Secured_and_Unsecured_Debt_of_1
Secured and Unsecured Debt of the Operating Partnership (Tables) (Kilroy Realty, L.P. [Member]) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Per Share Average Trading Price Of Companys Common Stock On Stock Exchange [Tables Text Block] | For the three and nine months ended September 30, 2013 and 2012, the per share average trading price of the Company’s common stock on the NYSE was higher than the $35.93 exchange price for the 4.25% Exchangeable Notes, as presented below: | |||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Per share average trading price of the Company’s common stock | $51.57 | $47.56 | $52.42 | $45.74 | ||||||||||||
Schedule of Debt Conversions, Fair Value Upon Conversion [Table Text Block] | The 4.25% Exchangeable Notes were exchangeable as of September 30, 2013, and were not exchangeable as of September 30, 2012. If the Exchangeable Notes were exchangeable for all periods presented, the approximate fair value of the shares upon exchangeable at September 30, 2013 and 2012, using the per share average trading price presented in the table above, would have been as follows: | |||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(in thousands) | ||||||||||||||||
Approximate fair value of shares upon conversion | $ | 245,200 | $ | 225,100 | $ | 248,000 | $ | 218,600 | ||||||||
Principal amount of the 4.25% Exchangeable Notes | 172,500 | 172,500 | 172,500 | 172,500 | ||||||||||||
Approximate fair value in excess amount of principal amount | $ | 72,700 | $ | 52,600 | $ | 75,500 | $ | 46,100 | ||||||||
Interest expense for the exchangeable notes | The following table summarizes the total interest expense attributable to the 4.25% Exchangeable Notes and attributable to the 3.25% Exchangeable Notes (which were repaid upon maturity in April 2012), in each case based on the respective effective interest rates, before the effect of capitalized interest, for the three and nine months ended September 30, 2013 and 2012: | |||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(in thousands) | ||||||||||||||||
Contractual interest payments (1) | $ | 1,833 | $ | 1,833 | $ | 5,498 | $ | 6,888 | ||||||||
Amortization of discount (1) | 1,116 | 1,041 | 3,291 | 3,993 | ||||||||||||
Interest expense attributable to the Exchangeable Notes (1) | $ | 2,949 | $ | 2,874 | $ | 8,789 | $ | 10,881 | ||||||||
_______________ | ||||||||||||||||
-1 | The Company repaid the 3.25% Exchangeable Notes in April 2012. Interest payments and discount amortization for the three and nine months ended September 30, 2013 and three months ended September 30, 2012 are solely attributable to the 4.25% Exchangeable Notes. | |||||||||||||||
Capped call Transactions | The table below summarizes our capped call option positions for the 4.25% Exchangeable Notes as of September 30, 2013 and December 31, 2012. | |||||||||||||||
4.25% Exchangeable Notes | ||||||||||||||||
Referenced shares of common stock | 4,800,796 | |||||||||||||||
Exchange price including effect of capped calls | $ | 42.81 | ||||||||||||||
Unsecured Revolving Credit Facility | The following table summarizes the balance and terms of our revolving credit facility as of September 30, 2013 and December 31, 2012, respectively: | |||||||||||||||
September 30, | December 31, | |||||||||||||||
2013 | 2012 | |||||||||||||||
(in thousands) | ||||||||||||||||
Outstanding borrowings | $ | — | $ | 185,000 | ||||||||||||
Remaining borrowing capacity | 500,000 | 315,000 | ||||||||||||||
Total borrowing capacity (1) | $ | 500,000 | $ | 500,000 | ||||||||||||
Interest rate (2) | 1.66 | % | ||||||||||||||
Facility fee-annual rate (3) | 0.30% | |||||||||||||||
Maturity date (4) | Apr-17 | |||||||||||||||
_______________ | ||||||||||||||||
-1 | We may elect to borrow, subject to bank approval, up to an additional $200.0 million under an accordion feature under the terms of the revolving credit facility. | |||||||||||||||
-2 | The revolving credit facility interest rate was calculated based on an annual rate of LIBOR plus 1.450% as of both September 30, 2013 and December 31, 2012. No interest rate is shown as of September 30, 2013 because no borrowings were outstanding. | |||||||||||||||
-3 | The facility fee is paid on a quarterly basis and is calculated based on the total borrowing capacity. In addition to the facility fee, from 2010 to 2012 we incurred debt origination and legal costs totaling approximately $10.2 million that are currently being amortized through the maturity date of the revolving credit facility. | |||||||||||||||
-4 | Under the terms of the revolving credit facility, we may exercise an option to extend the maturity date by one year. | |||||||||||||||
Stated debt maturities and scheduled amortization payments, excluding debt discounts | The following table summarizes the stated debt maturities and scheduled amortization payments, excluding debt discounts and premiums, as of September 30, 2013: | |||||||||||||||
Year | (in thousands) | |||||||||||||||
Remaining 2013 | $ | 2,387 | ||||||||||||||
2014 | 265,346 | |||||||||||||||
2015 | 395,104 | |||||||||||||||
2016 | 249,431 | |||||||||||||||
2017 | 71,748 | |||||||||||||||
Thereafter | 1,169,742 | |||||||||||||||
Total (1) | $ | 2,153,758 | ||||||||||||||
________________________ | ||||||||||||||||
-1 | Includes gross principal balance of outstanding debt before impact of net unamortized premiums totaling approximately $8.4 million. | |||||||||||||||
Capitalized interest and loan fees | The following table sets forth gross interest expense reported in continuing operations, including debt discount/premium and loan cost amortization, net of capitalized interest, for the three and nine months ended September 30, 2013 and 2012. The interest expense capitalized was recorded as a cost of development and redevelopment, and increased the carrying value of undeveloped land and construction in progress. | |||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(in thousands) | ||||||||||||||||
Gross interest expense | $ | 27,942 | $ | 24,843 | $ | 83,322 | $ | 73,326 | ||||||||
Capitalized interest | (9,089 | ) | (4,989 | ) | (25,301 | ) | (13,154 | ) | ||||||||
Interest expense | $ | 18,853 | $ | 19,854 | $ | 58,021 | $ | 60,172 | ||||||||
Secured Debt [Member] | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Balance and significant terms of debt | The following table sets forth the composition of our secured debt as of September 30, 2013 and December 31, 2012: | |||||||||||||||
Type of Debt | Annual Stated Interest Rate (1) | GAAP | Maturity Date | September 30, 2013 (3) | December 31, 2012 (3) | |||||||||||
Effective Rate (1)(2) | ||||||||||||||||
(in thousands) | ||||||||||||||||
Mortgage note payable | 4.27% | 4.27% | Feb-18 | $ | 133,689 | $ | 135,000 | |||||||||
Mortgage note payable (4) | 4.48% | 4.48% | Jul-27 | 97,000 | 97,000 | |||||||||||
Mortgage note payable (4)(5) | 6.05% | 3.50% | Jun-19 | 93,306 | — | |||||||||||
Mortgage note payable (6) | 6.37% | 3.55% | Apr-13 | — | 83,116 | |||||||||||
Mortgage note payable | 6.51% | 6.51% | Feb-17 | 67,907 | 68,615 | |||||||||||
Mortgage note payable (4) | 5.23% | 3.50% | Jan-16 | 55,007 | 56,302 | |||||||||||
Mortgage note payable (4) | 5.57% | 3.25% | Feb-16 | 41,999 | 43,016 | |||||||||||
Mortgage note payable (4) | 5.09% | 3.50% | Aug-15 | 34,979 | 35,379 | |||||||||||
Mortgage note payable (4) | 4.94% | 4.00% | Apr-15 | 27,970 | 28,941 | |||||||||||
Mortgage note payable | 7.15% | 7.15% | May-17 | 9,546 | 11,210 | |||||||||||
Other | Various | Various | Various | 2,495 | 2,517 | |||||||||||
Total | $ | 563,898 | $ | 561,096 | ||||||||||||
______________ | ||||||||||||||||
-1 | All interest rates presented are fixed-rate interest rates. | |||||||||||||||
-2 | This represents the rate at which interest expense is recorded for financial reporting purposes, which reflects the amortization of discounts/premiums, excluding debt issuance costs. | |||||||||||||||
-3 | Amounts reported include the amounts of unamortized debt premiums and discounts for the periods presented. | |||||||||||||||
-4 | The secured debt and the related properties that secure the debt are held in a special purpose entity and the properties are not available to satisfy the debts and other obligations of the Company or the Operating Partnership. | |||||||||||||||
-5 | In January 2013, in connection with the acquisition of two office buildings in Seattle, Washington, we assumed a mortgage loan that is secured by the project. The assumed mortgage had a principal balance of $83.9 million at the acquisition date and was recorded at fair value on the date of the acquisition resulting in a premium of approximately $11.6 million. The loan requires monthly principal and interest payments based on a 6.4 year amortization period. | |||||||||||||||
-6 | In January 2013, we repaid this loan prior to the stated maturity date. | |||||||||||||||
Convertible Debt [Member] | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Balance and significant terms of debt | The table below summarizes the balance and significant terms of the Company’s 4.25% Exchangeable Notes due November 2014 (the “4.25% Exchangeable Notes”) outstanding as of September 30, 2013 and December 31, 2012. | |||||||||||||||
4.25% Exchangeable Notes | ||||||||||||||||
September 30, | December 31, | |||||||||||||||
2013 | 2012 | |||||||||||||||
(in thousands) | ||||||||||||||||
Principal amount | $ | 172,500 | $ | 172,500 | ||||||||||||
Unamortized discount | (5,264 | ) | (8,556 | ) | ||||||||||||
Net carrying amount of liability component | $ | 167,236 | $ | 163,944 | ||||||||||||
Carrying amount of equity component | $19,835 | |||||||||||||||
Issuance date | Nov-09 | |||||||||||||||
Maturity date | Nov-14 | |||||||||||||||
Stated coupon rate (1) | 4.25% | |||||||||||||||
Effective interest rate (2) | 7.13% | |||||||||||||||
Exchange rate per $1,000 principal value of the 4.25% Exchangeable Notes, as adjusted (3) | 27.8307 | |||||||||||||||
Exchange price, as adjusted (3) | $35.93 | |||||||||||||||
Number of shares on which the aggregate consideration to be delivered on conversion is determined (3) | 4,800,796 | |||||||||||||||
_______________ | ||||||||||||||||
-1 | Interest on the 4.25% Exchangeable Notes is payable semi-annually in arrears on May 15th and November 15th of each year. | |||||||||||||||
-2 | The rate at which we record interest expense for financial reporting purposes, which reflects the amortization of the discounts on the 4.25% Exchangeable Notes. This rate represents our conventional debt borrowing rate at the date of issuance. | |||||||||||||||
-3 | The exchange rate, exchange price, and the number of shares to be delivered upon conversion are subject to adjustment under certain circumstances including increases in our common dividends. |
Stockholders_Equity_of_the_Com1
Stockholders' Equity of the Company (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Equity [Abstract] | ||||||||
Schedule of Stockholders Equity | The following table sets forth information regarding sales of our common stock under our at-the-market offering program for the three and nine months ended September 30, 2013: | |||||||
Three Months Ended September 30, 2013 | Nine Months Ended September 30, 2013 | |||||||
(in millions, except share and per share data) | ||||||||
Common shares sold during the period | 226,430 | 1,040,838 | ||||||
Weighted average price per common share | $ | 51.12 | $ | 53.11 | ||||
Aggregate gross proceeds | $ | 11.6 | $ | 55.3 | ||||
Aggregate net proceeds after sales agent compensation | $ | 11.4 | $ | 54.4 | ||||
Partners_Capital_of_the_Operat1
Partners' Capital of the Operating Partnership Ownership Interest (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Noncontrolling Interest [Abstract] | |||||||||
Redeemable Noncontrolling Interest | The following table sets forth the number of common units held by the Company and the number of common units held by non-affiliate investors and certain of our executive officers and directors in the form of noncontrolling common units as well as the ownership interest held on each respective date: | ||||||||
September 30, 2013 | December 31, 2012 | September 30, 2012 | |||||||
Company owned common units in the Operating Partnership | 82,113,491 | 74,926,981 | 74,692,939 | ||||||
Company owned general partnership interest | 97.8 | % | 97.6 | % | 97.6 | % | |||
Noncontrolling common units of the Operating Partnership | 1,821,503 | 1,826,503 | 1,826,503 | ||||||
Ownership interest of noncontrolling interest | 2.2 | % | 2.4 | % | 2.4 | % |
ShareBased_Compensation_Tables
Share-Based Compensation (Tables) | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Summary of Restricted Stock Units | A summary of our nonvested and vested restricted stock activity for the nine months ended September 30, 2013 and 2012 is presented below: | |||||||||||||
Shares Granted | Shares Vested | |||||||||||||
Nine months ended September 30, | Non-Vested | Weighted-Average Grant Date | Vested Shares | Total Fair Value at Vest Date(1) | ||||||||||
Shares Issued | Fair Value | (in thousands) | ||||||||||||
Per Share | ||||||||||||||
2013 | — | $ | — | (47,291 | ) | $ | 2,290 | |||||||
2012 | 62,137 | 41.84 | (35,623 | ) | 1.388 | |||||||||
_______________ | ||||||||||||||
-1 | Total fair value of shares vested was calculated based on the quoted closing share price of the Company’s common stock on the NYSE on the date of vesting. | |||||||||||||
Summary of nonvested shares | A summary of our nonvested restricted stock activity from January 1, 2013 through September 30, 2013 is presented below: | |||||||||||||
Non-Vested | Weighted-Average | |||||||||||||
Restricted Stock | Grant Date | |||||||||||||
Fair Value | ||||||||||||||
Per Share | ||||||||||||||
Outstanding at January 1, 2013 | 95,241 | $ | 40.42 | |||||||||||
Granted | — | — | ||||||||||||
Vested (1) | (47,291 | ) | 39.12 | |||||||||||
Outstanding as of September 30, 2013 | 47,950 | $ | 41.71 | |||||||||||
_______________ | ||||||||||||||
-1 | The total shares vested include 20,880 shares that were tendered in accordance with the terms of the 2006 Plan to satisfy minimum statutory tax withholding requirements related to the restricted shares that have vested. We accept the return of shares at the current quoted closing share price of the Company’s common stock to satisfy tax obligations. | |||||||||||||
Schedule of Share-based Compensation, Stock Options, Activity | A summary of our stock option activity from January 1, 2013 through September 30, 2013 is presented below: | |||||||||||||
Number of Options | Exercise Price | Remaining Contractual Term (years) | ||||||||||||
Outstanding at January 1, 2013 | 1,540,000 | $ | 42.61 | |||||||||||
Granted | — | — | ||||||||||||
Exercised | (3,000 | ) | 42.61 | |||||||||||
Forfeited | (12,000 | ) | 42.61 | |||||||||||
Outstanding at September 30, 2013 (1)(2) | 1,525,000 | $ | 42.61 | 8.4 | ||||||||||
_______________ | ||||||||||||||
-1 | As of September 30, 2013, 305,000 of the outstanding stock options were exercisable. | |||||||||||||
-2 | The total intrinsic value of options outstanding at September 30, 2013 was $11.2 million. | |||||||||||||
Market Measure-Based Restricted Stock Units (RSUs) [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Restricted stock units market-measure assumptions [Table Text Block] | The expected life of the RSUs is equal to the six year vesting period. | |||||||||||||
April 2013 Market-Measure based RSU Grant | ||||||||||||||
Grant date fair value per share | $44.55 | |||||||||||||
Expected share price volatility | 27.00% | |||||||||||||
Risk-free interest rate | 0.90% | |||||||||||||
Dividend yield | 3.60% | |||||||||||||
Expected life | 6 years | |||||||||||||
Summary of Restricted Stock Units | A summary of our market-measure based RSU activity for the nine months ended September 30, 2013 and 2012 is presented below: | |||||||||||||
RSUs Granted | RSUs Vested | |||||||||||||
Nine months ended September 30, | Non-Vested | Weighted-Average Grant Date | Vested RSUs | Total Vest-Date Fair Value | ||||||||||
RSUs Issued | Fair Value | (in thousands) | ||||||||||||
Per Share | ||||||||||||||
2013 | 9,542 | $ | 44.55 | — | $ | — | ||||||||
2012 | 103,239 | 41.2 | — | — | ||||||||||
A summary of our market-measure based RSU activity from January 1, 2013 through September 30, 2013 is presented below: | ||||||||||||||
Nonvested RSUs | Vested RSUs | Total RSUs | ||||||||||||
Amount | Weighted-Average | |||||||||||||
Grant Date | ||||||||||||||
Fair Value | ||||||||||||||
Per Share | ||||||||||||||
Outstanding at January 1, 2013 | 88,491 | $ | 41.2 | 14,748 | 103,239 | |||||||||
Granted | 9,542 | 44.55 | — | 9,542 | ||||||||||
Vested | — | — | — | — | ||||||||||
Settled | — | — | — | |||||||||||
Issuance of dividend equivalents | — | — | — | |||||||||||
Modified from time based (1) | 61,327 | 53.05 | — | 61,327 | ||||||||||
Canceled | — | — | ||||||||||||
Outstanding as of September 30, 2013 | 159,360 | $ | 45.96 | 14,748 | 174,108 | |||||||||
_______________ | ||||||||||||||
-1 | On April 4, 2013 the terms of time-based RSU’s granted to certain officers of the Company in January were modified to include market-measure and performance-based vesting requirements. | |||||||||||||
Time-Based Restricted Stock Units (RSUs) [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Summary of Restricted Stock Units | A summary of our time-based RSU activity from January 1, 2013 through September 30, 2013 is presented below: | |||||||||||||
Nonvested RSUs | Vested RSUs | Total RSUs | ||||||||||||
Amount | Weighted-Average | |||||||||||||
Grant Date | ||||||||||||||
Fair Value | ||||||||||||||
Per Share | ||||||||||||||
Outstanding at January 1, 2013 | 279,102 | $ | 41.3 | 769,761 | 1,048,863 | |||||||||
Granted, net of forfeitures | 173,758 | 49.45 | — | 173,758 | ||||||||||
Vested | (73,574 | ) | 38.8 | 73,574 | — | |||||||||
Settled (1) | (10,342 | ) | (10,342 | ) | ||||||||||
Issuance of dividend equivalents (2) | 20,421 | 20,421 | ||||||||||||
Modified to market-measure based (3) | (61,327 | ) | 53.05 | — | (61,327 | ) | ||||||||
Canceled (1)(4) | (3,800 | ) | (3,800 | ) | ||||||||||
Outstanding as of September 30, 2013 | 317,959 | $ | 46.13 | 849,614 | 1,167,573 | |||||||||
_______________ | ||||||||||||||
-1 | Represents vested RSUs that are settled in cash or shares of the Company’s common stock. | |||||||||||||
-2 | RSUs issued as dividend equivalents are vested upon issuance. | |||||||||||||
-3 | During the second quarter the terms of time-based RSUs granted to certain officers of the Company in January were modified to include market-measure based vesting requirements. | |||||||||||||
-4 | We accept the return of RSUs, at the current quoted closing share price of the Company’s common stock, to satisfy minimum statutory tax-withholding requirements related to either the issuance, vesting or settlement of RSUs in accordance with the terms of the 2006 Plan. | |||||||||||||
A summary of our time-based RSU activity for the nine months ended September 30, 2013 and 2012 is presented below: | ||||||||||||||
RSUs Granted | RSUs Vested | |||||||||||||
Nine months ended September 30, | Non-Vested | Weighted-Average Grant Date | Vested RSUs | Total Vest-Date Fair Value (1) | ||||||||||
RSUs Issued | Fair Value | (in thousands) | ||||||||||||
Per Share | ||||||||||||||
2013 | 173,758 | $ | 49.45 | (73,574 | ) | $ | 3,677 | |||||||
2012 | 204,829 | 44.34 | (58,940 | ) | 2,420 | |||||||||
_______________ | ||||||||||||||
-1 | Total fair value of RSUs vested was calculated based on the quoted closing share price of the Company’s common stock on the NYSE on the day of vesting. |
Fair_Value_Measurements_and_Di1
Fair Value Measurements and Disclosures (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||
Fair value of the company's marketable securities | The following table sets forth the fair value of our marketable securities as of September 30, 2013 and December 31, 2012: | |||||||||||||||
Fair Value (Level 1) (1) | ||||||||||||||||
September 30, 2013 | December 31, 2012 | |||||||||||||||
Description | (in thousands) | |||||||||||||||
Marketable securities (2) | $ | 9,192 | $ | 7,435 | ||||||||||||
_______________ | ||||||||||||||||
-1 | Based on quoted prices in active markets for identical securities. | |||||||||||||||
-2 | The marketable securities are held in a limited rabbi trust. | |||||||||||||||
Fair value adjustment of marketable securities and deferred compensation plan liability | The following table sets forth the net gain on marketable securities recorded during the three and nine months ended September 30, 2013 and 2012: | |||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Description | (in thousands) | |||||||||||||||
Net gain on marketable securities | $ | 669 | $ | 315 | $ | 995 | $ | 595 | ||||||||
Carrying value and fair value of company's remaining financial assets and liabilities | The following table sets forth the carrying value and the fair value of our other financial instruments as of September 30, 2013 and December 31, 2012: | |||||||||||||||
September 30, 2013 | December 31, 2012 | |||||||||||||||
Carrying | Fair | Carrying | Fair | |||||||||||||
Value | Value | Value | Value | |||||||||||||
(in thousands) | ||||||||||||||||
Liabilities | ||||||||||||||||
Secured debt (1) | $ | 563,898 | $ | 574,661 | $ | 561,096 | $ | 591,993 | ||||||||
Exchangeable senior notes, net (1) | 167,236 | 178,379 | 163,944 | 181,223 | ||||||||||||
Unsecured debt, net (2) | 1,431,048 | 1,522,228 | 1,130,895 | 1,254,047 | ||||||||||||
Unsecured line of credit (1) | — | — | 185,000 | 185,049 | ||||||||||||
_______________ | ||||||||||||||||
-1 | Fair value calculated using Level II inputs which are based on model-derived valuations in which significant inputs and significant value drivers are observable in active markets. | |||||||||||||||
-2 | Fair value calculated using Level I and Level II inputs. Level I inputs are based on quoted prices for identical instruments in active markets. The carrying value and fair value of the Level I instruments was $841.9 million and $932.2 million, respectively, as of September 30, 2013. The carrying value and fair value of the Level I instruments at December 31, 2012, was $573.3 million and $653.0 million, respectively. The carrying value and fair value of the Level II instruments was $589.2 million and $590.0 million, respectively, as of September 30, 2013. The carrying value and fair value of the Level II instruments at December 31, 2012, was $557.6 million and $601.0 million, respectively. |
Discontinued_Operations_Tables
Discontinued Operations (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Discontinued Operations and Disposal Groups [Abstract] | ||||||||||||||||
Property Sold During The Period | The following table summarizes the property sold during the nine months ended September 30, 2013: | |||||||||||||||
Location | Property Type | Month of Disposition | Number of Buildings | Rentable | Sales Price | |||||||||||
Square Feet | (in millions) | |||||||||||||||
26541 Agoura Road, Calabasas, CA | Office | June | 1 | 90,156 | $ | 14.7 | ||||||||||
Assets Held-for-sale | As of September 30, 2013, the following properties were classified as held for sale: | |||||||||||||||
Location | City/Submarket | Property Type | Number of Buildings | Rentable Square Feet | ||||||||||||
San Diego Properties, San Diego, CA (1) | I-15 Corridor/Sorrento Mesa | Office | 13 | 1,099,395 | ||||||||||||
8101 Kaiser Boulevard, Anaheim, CA (2) | Anaheim | Office | 1 | 59,790 | ||||||||||||
Total properties held for sale | 14 | 1,159,185 | ||||||||||||||
________________________ | ||||||||||||||||
-1 | The San Diego Properties included the following: 4910 Directors Place, 10020 Pacific Mesa Boulevard, 6055 Lusk Avenue, 5010 and 5005 Wateridge Vista Drive, 15435 and 15445 Innovation Drive, and 15051, 15073, 15231, 15253, 15333 and 15378 Avenue of Science. | |||||||||||||||
-2 | We closed on the disposition of this property on October 2, 2013. The sales price was $9.6 million. | |||||||||||||||
Schedule of Disposal Groups, Including Discontinued Operations, Income Statement, Balance Sheet and Additional Disclosures | The major classes of assets and liabilities of the properties held for sale as of September 30, 2013 were as follows: | |||||||||||||||
Real estate assets and other assets held for sale | (in thousands) | |||||||||||||||
Land and improvements | $ | 54,273 | ||||||||||||||
Buildings and improvements | 236,792 | |||||||||||||||
Undeveloped land and construction in progress | 1,441 | |||||||||||||||
Total real estate held for sale | 292,506 | |||||||||||||||
Accumulated depreciation | (70,084 | ) | ||||||||||||||
Total real estate held for sale, net | 222,422 | |||||||||||||||
Current receivables, net | 303 | |||||||||||||||
Deferred rent receivables, net | 9,062 | |||||||||||||||
Deferred leasing costs and acquisition-related intangible assets, net | 6,643 | |||||||||||||||
Prepaid expenses and other assets, net | 981 | |||||||||||||||
Real estate and other assets held for sale, net | $ | 239,411 | ||||||||||||||
Liabilities and deferred revenue of real estate assets held for sale | ||||||||||||||||
Accounts payable and other liabilities | $ | 2,554 | ||||||||||||||
Deferred revenue and acquisition-related intangible liabilities, net | 12,785 | |||||||||||||||
Rents received in advance and tenant security deposits | 1,412 | |||||||||||||||
Liabilities and deferred revenue of real estate assets held for sale | $ | 16,751 | ||||||||||||||
The following table summarizes the revenue and expense components that comprise Income from discontinued operations for the three and nine months ended September 30, 2013 and 2012: | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(in thousands) | ||||||||||||||||
Revenues: | ||||||||||||||||
Rental income | $ | 6,604 | $ | 10,522 | $ | 18,334 | $ | 33,105 | ||||||||
Tenant reimbursements | 892 | 1,639 | 2,331 | 5,296 | ||||||||||||
Other property income | 4,610 | 229 | 4,617 | 884 | ||||||||||||
Total revenues | 12,106 | 12,390 | 25,282 | 39,285 | ||||||||||||
Expenses: | ||||||||||||||||
Property expenses | 2,020 | 2,044 | 3,920 | 6,287 | ||||||||||||
Real estate taxes | 684 | 1,301 | 2,048 | 3,719 | ||||||||||||
Provision for bad debts | (23 | ) | (194 | ) | (23 | ) | (194 | ) | ||||||||
Depreciation and amortization | 3,081 | 4,550 | 8,531 | 13,870 | ||||||||||||
Total expenses | 5,762 | 7,701 | 14,476 | 23,682 | ||||||||||||
Income from discontinued operations before net gain on dispositions | 6,344 | 4,689 | 10,806 | 15,603 | ||||||||||||
of discontinued operations | ||||||||||||||||
Net gain on dispositions of discontinued operations | — | — | 423 | 72,809 | ||||||||||||
Total income from discontinued operations | $ | 6,344 | $ | 4,689 | $ | 11,229 | $ | 88,412 | ||||||||
Net_Loss_Income_Available_to_C2
Net (Loss) Income Available to Common Stockholders Per Share of the Company (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Earnings Per Share [Abstract] | ||||||||||||||||
Net income available to common stockholders | The following table reconciles the numerator and denominator in computing the Company’s basic and diluted per-share computations for net income (loss) available to common stockholders for the three and nine months ended September 30, 2013 and 2012: | |||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(in thousands, except share and | ||||||||||||||||
per share amounts) | ||||||||||||||||
Numerator: | ||||||||||||||||
Income (loss) from continuing operations | $ | 2,683 | $ | (2,167 | ) | $ | 10,289 | $ | (4,941 | ) | ||||||
Loss (income) from continuing operations attributable to | 14 | 179 | (8 | ) | 564 | |||||||||||
noncontrolling common units of the Operating Partnership | ||||||||||||||||
Preferred distributions and dividends | (3,312 | ) | (5,342 | ) | (9,938 | ) | (17,775 | ) | ||||||||
Allocation to participating securities (1) | (450 | ) | (408 | ) | (1,292 | ) | (1,225 | ) | ||||||||
Numerator for basic and diluted loss from continuing | (1,065 | ) | (7,738 | ) | (949 | ) | (23,377 | ) | ||||||||
operations available to common stockholders | ||||||||||||||||
Income from discontinued operations | 6,344 | 4,689 | 11,229 | 88,412 | ||||||||||||
Income from discontinued operations attributable to | (145 | ) | (112 | ) | (258 | ) | (2,272 | ) | ||||||||
noncontrolling common units of the Operating Partnership | ||||||||||||||||
Numerator for basic and diluted net income (loss) | $ | 5,134 | $ | (3,161 | ) | $ | 10,022 | $ | 62,763 | |||||||
available to common stockholders | ||||||||||||||||
Denominator: | ||||||||||||||||
Basic weighted average vested shares outstanding | 76,768,893 | 71,889,475 | 75,750,822 | 67,975,309 | ||||||||||||
Effect of dilutive securities – contingently issuable shares | — | — | — | — | ||||||||||||
and stock options | ||||||||||||||||
Diluted weighted average vested shares and common share | 76,768,893 | 71,889,475 | 75,750,822 | 67,975,309 | ||||||||||||
equivalents outstanding | ||||||||||||||||
Basic earnings per share: | ||||||||||||||||
Loss from continuing operations available to common | $ | (0.01 | ) | $ | (0.10 | ) | $ | (0.01 | ) | $ | (0.34 | ) | ||||
stockholders per share | ||||||||||||||||
Income from discontinued operations per common share | 0.08 | 0.06 | 0.14 | 1.26 | ||||||||||||
Net income (loss) available to common stockholders per share | $ | 0.07 | $ | (0.04 | ) | $ | 0.13 | $ | 0.92 | |||||||
Diluted earnings per share: | ||||||||||||||||
Loss from continuing operations available to common | $ | (0.01 | ) | $ | (0.10 | ) | $ | (0.01 | ) | $ | (0.34 | ) | ||||
stockholders per share | ||||||||||||||||
Income from discontinued operations per common share | 0.08 | 0.06 | 0.14 | 1.26 | ||||||||||||
Net income (loss) available to common stockholders per share | $ | 0.07 | $ | (0.04 | ) | $ | 0.13 | $ | 0.92 | |||||||
________________________ | ||||||||||||||||
-1 | Participating securities include nonvested shares, time-based RSUs and vested market-measure RSUs. |
Net_Loss_Income_Available_to_C3
Net (Loss) Income Available to Common Unitholders Per Unit of the Operating Partnership (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Net Income Available To Common Unitholders [Line Items] | ||||||||||||||||
Net income available to common unitholders | The following table reconciles the numerator and denominator in computing the Company’s basic and diluted per-share computations for net income (loss) available to common stockholders for the three and nine months ended September 30, 2013 and 2012: | |||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(in thousands, except share and | ||||||||||||||||
per share amounts) | ||||||||||||||||
Numerator: | ||||||||||||||||
Income (loss) from continuing operations | $ | 2,683 | $ | (2,167 | ) | $ | 10,289 | $ | (4,941 | ) | ||||||
Loss (income) from continuing operations attributable to | 14 | 179 | (8 | ) | 564 | |||||||||||
noncontrolling common units of the Operating Partnership | ||||||||||||||||
Preferred distributions and dividends | (3,312 | ) | (5,342 | ) | (9,938 | ) | (17,775 | ) | ||||||||
Allocation to participating securities (1) | (450 | ) | (408 | ) | (1,292 | ) | (1,225 | ) | ||||||||
Numerator for basic and diluted loss from continuing | (1,065 | ) | (7,738 | ) | (949 | ) | (23,377 | ) | ||||||||
operations available to common stockholders | ||||||||||||||||
Income from discontinued operations | 6,344 | 4,689 | 11,229 | 88,412 | ||||||||||||
Income from discontinued operations attributable to | (145 | ) | (112 | ) | (258 | ) | (2,272 | ) | ||||||||
noncontrolling common units of the Operating Partnership | ||||||||||||||||
Numerator for basic and diluted net income (loss) | $ | 5,134 | $ | (3,161 | ) | $ | 10,022 | $ | 62,763 | |||||||
available to common stockholders | ||||||||||||||||
Denominator: | ||||||||||||||||
Basic weighted average vested shares outstanding | 76,768,893 | 71,889,475 | 75,750,822 | 67,975,309 | ||||||||||||
Effect of dilutive securities – contingently issuable shares | — | — | — | — | ||||||||||||
and stock options | ||||||||||||||||
Diluted weighted average vested shares and common share | 76,768,893 | 71,889,475 | 75,750,822 | 67,975,309 | ||||||||||||
equivalents outstanding | ||||||||||||||||
Basic earnings per share: | ||||||||||||||||
Loss from continuing operations available to common | $ | (0.01 | ) | $ | (0.10 | ) | $ | (0.01 | ) | $ | (0.34 | ) | ||||
stockholders per share | ||||||||||||||||
Income from discontinued operations per common share | 0.08 | 0.06 | 0.14 | 1.26 | ||||||||||||
Net income (loss) available to common stockholders per share | $ | 0.07 | $ | (0.04 | ) | $ | 0.13 | $ | 0.92 | |||||||
Diluted earnings per share: | ||||||||||||||||
Loss from continuing operations available to common | $ | (0.01 | ) | $ | (0.10 | ) | $ | (0.01 | ) | $ | (0.34 | ) | ||||
stockholders per share | ||||||||||||||||
Income from discontinued operations per common share | 0.08 | 0.06 | 0.14 | 1.26 | ||||||||||||
Net income (loss) available to common stockholders per share | $ | 0.07 | $ | (0.04 | ) | $ | 0.13 | $ | 0.92 | |||||||
________________________ | ||||||||||||||||
-1 | Participating securities include nonvested shares, time-based RSUs and vested market-measure RSUs. | |||||||||||||||
Kilroy Realty, L.P. [Member] | ||||||||||||||||
Net Income Available To Common Unitholders [Line Items] | ||||||||||||||||
Net income available to common unitholders | The following table reconciles the numerator and denominator in computing the Operating Partnership’s basic and diluted per-unit computations for net income (loss) available to common unitholders for the three and nine months ended September 30, 2013 and 2012: | |||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(in thousands, except unit and | ||||||||||||||||
per unit amounts) | ||||||||||||||||
Numerator: | ||||||||||||||||
Income (loss) from continuing operations | $ | 2,683 | $ | (2,167 | ) | $ | 10,289 | $ | (4,941 | ) | ||||||
Income from continuing operations attributable to | (47 | ) | (48 | ) | (178 | ) | (144 | ) | ||||||||
noncontrolling interests in consolidated subsidiaries | ||||||||||||||||
Preferred distributions | (3,312 | ) | (5,342 | ) | (9,938 | ) | (17,775 | ) | ||||||||
Allocation to participating securities (1) | (450 | ) | (408 | ) | (1,292 | ) | (1,225 | ) | ||||||||
Numerator for basic and diluted loss from continuing | (1,126 | ) | (7,965 | ) | (1,119 | ) | (24,085 | ) | ||||||||
operations available to common unitholders | ||||||||||||||||
Income from discontinued operations | 6,344 | 4,689 | 11,229 | 88,412 | ||||||||||||
Numerator for basic and diluted net income (loss) available | $ | 5,218 | $ | (3,276 | ) | $ | 10,110 | $ | 64,327 | |||||||
to common unitholders | ||||||||||||||||
Denominator: | ||||||||||||||||
Basic weighted average vested units outstanding | 78,590,396 | 73,680,259 | 77,574,907 | 69,717,834 | ||||||||||||
Effect of dilutive securities - contingently issuable shares | — | — | — | — | ||||||||||||
and stock options | ||||||||||||||||
Diluted weighted average vested units and common unit | 78,590,396 | 73,680,259 | 77,574,907 | 69,717,834 | ||||||||||||
equivalents outstanding | ||||||||||||||||
Basic earnings per unit: | ||||||||||||||||
Loss from continuing operations available to common | $ | (0.01 | ) | $ | (0.10 | ) | $ | (0.01 | ) | $ | (0.34 | ) | ||||
unitholders per unit | ||||||||||||||||
Income from discontinued operations per common unit | 0.08 | 0.06 | 0.14 | 1.26 | ||||||||||||
Net income (loss) available to common unitholders per unit | $ | 0.07 | $ | (0.04 | ) | $ | 0.13 | $ | 0.92 | |||||||
Diluted earnings per unit: | ||||||||||||||||
Loss from continuing operations available to common | $ | (0.01 | ) | $ | (0.10 | ) | $ | (0.01 | ) | $ | (0.34 | ) | ||||
unitholders per unit | ||||||||||||||||
Income from discontinued operations per common unit | 0.08 | 0.06 | 0.14 | 1.26 | ||||||||||||
Net income (loss) available to common unitholders per unit | $ | 0.07 | $ | (0.04 | ) | $ | 0.13 | $ | 0.92 | |||||||
________________________ | ||||||||||||||||
-1 | Participating securities include nonvested shares, time-based RSUs and vested market-measure RSUs. |
Organization_and_Basis_of_Pres3
Organization and Basis of Presentation (Details) | Sep. 30, 2013 | |
building | ||
Real Estate Properties [Line Items] | ||
Number of buildings | 14 | |
Office Properties [Member] | ||
Real Estate Properties [Line Items] | ||
Number of buildings | 103 | [1] |
Rentable square feet | 12,536,495 | [1] |
Number of Tenants | 654 | [1] |
Percentage Occupied | 92.20% | [1] |
Other Segments [Member] | Properties Held for Sale [Member] | ||
Real Estate Properties [Line Items] | ||
Number of buildings | 14 | [2] |
Rentable square feet | 1,159,185 | [2] |
Other Segments [Member] | Development Properties [Member] | ||
Real Estate Properties [Line Items] | ||
Number of buildings | 5 | [3] |
Rentable square feet | 1,516,000 | [3] |
Other Segments [Member] | Lease Up Properties [Member] | ||
Real Estate Properties [Line Items] | ||
Number of buildings | 2 | |
Rentable square feet | 508,000 | |
San Diego, California [Member] | Other Segments [Member] | Properties Held for Sale [Member] | ||
Real Estate Properties [Line Items] | ||
Number of buildings | 13 | [3],[4] |
Anaheim, California [Member] | Other Segments [Member] | Properties Held for Sale [Member] | ||
Real Estate Properties [Line Items] | ||
Number of buildings | 1 | [3],[5] |
[1] | Excludes 13 properties located in San Diego, California and one property in Anaheim, California that were held for sale at September 30, 2013 (see Note 12 “Discontinued Operationsâ€). | |
[2] | Includes 13 properties located in San Diego, California and one property in Anaheim, California (see Note 12). | |
[3] | Estimated rentable square feet upon completion. | |
[4] | The San Diego Properties included the following: 4910 Directors Place, 10020 Pacific Mesa Boulevard, 6055 Lusk Avenue, 5010 and 5005 Wateridge Vista Drive, 15435 and 15445 Innovation Drive, and 15051, 15073, 15231, 15253, 15333 and 15378 Avenue of Science. | |
[5] | We closed on the disposition of this property on October 2, 2013. The sales price was $9.6 million. |
Organization_and_Basis_of_Pres4
Organization and Basis of Presentation (Details Textuals) (USD $) | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | |||
building | building | entity | ||||
entity | entity | |||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||
Stabilized Occupancy | 95.00% | |||||
Percentage of general partnership interest owned by the company in the Operating Partnership | 97.80% | 97.80% | 97.60% | 97.60% | ||
Percentage of Common limited partnership interest owned by certain non-affiliated investors and certain directors and officers of the Company in the Operating Partnership | 2.20% | 2.20% | 2.40% | 2.40% | ||
Number of buildings | 14 | 14 | ||||
Number of VIE's | 2 | 2 | 2 | |||
VIE Assets | $135,300,000 | $135,300,000 | $337,000,000 | |||
VIE Liabilities | 4,100,000 | 4,100,000 | 111,100,000 | |||
Impact of VIE to Noncontrolling interest | 4,885,000 | 4,885,000 | 0 | |||
Restricted cash | 228,300,000 | 229,613,000 | -5,526,000 | |||
WASHINGTON | ||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||
Number of buildings | 11 | 11 | ||||
Kilroy Realty, L.P. [Member] | ||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||
Percentage of General partnership interest owned by wholly-owned subsidiary of the Company | 1.00% | |||||
Percentage of limited partnership interest owned by Operating Partnership | 99.00% | |||||
Properties Held for Sale [Member] | Other Segments [Member] | ||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||
Number of buildings | 14 | [1] | 14 | [1] | ||
Properties Held for Sale [Member] | Other Segments [Member] | San Diego, California [Member] | ||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||
Number of buildings | 13 | [2],[3] | 13 | [2],[3] | ||
Properties Held for Sale [Member] | Other Segments [Member] | Anaheim, California [Member] | ||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||
Number of buildings | 1 | [2],[4] | 1 | [2],[4] | ||
Real Estate Investment [Member] | ||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||
VIE Assets | $119,262,000 | $119,262,000 | $319,770,000 | |||
[1] | Includes 13 properties located in San Diego, California and one property in Anaheim, California (see Note 12). | |||||
[2] | Estimated rentable square feet upon completion. | |||||
[3] | The San Diego Properties included the following: 4910 Directors Place, 10020 Pacific Mesa Boulevard, 6055 Lusk Avenue, 5010 and 5005 Wateridge Vista Drive, 15435 and 15445 Innovation Drive, and 15051, 15073, 15231, 15253, 15333 and 15378 Avenue of Science. | |||||
[4] | We closed on the disposition of this property on October 2, 2013. The sales price was $9.6 million. |
Acquisitions_Details
Acquisitions (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 27, 2013 | ||||
building | Office Properties Acquisitions [Member] | 320 & 321 Westlake Terry, Seattle WA [Member] | 12780 and 12790 El Camino Real, Sandiego, CA [Member] | Redwood City Partners, LLC [Member] | ||||||
sqft | building | sqft | ||||||||
building | sqft | building | ||||||||
Business Acquisition [Line Items] | ||||||||||
Date of Acquisition | 16-Jan-13 | [1],[2] | 19-Sep-13 | [3] | ||||||
Number of buildings | 14 | 4 | 2 | [1],[2] | 2 | [3] | ||||
Rentable square feet | 539,338 | 320,398 | [1],[2] | 218,940 | [3] | |||||
Occupancy as of September 30, 2013 | 100.00% | [1],[2] | 100.00% | [3] | ||||||
Purchase price | $296,400,000 | [4] | $170,000,000 | [1],[2],[4] | $126,400,000 | [3],[4] | ||||
Assets | ||||||||||
Undeveloped land and construction in progress | 11,222,000 | |||||||||
Land and improvements | 53,790,000 | [5] | ||||||||
Buildings and improvements | 218,211,000 | [5],[6] | ||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Undeveloped Land And Construction-in-Progress | 9,360,000 | [5],[7] | ||||||||
Deferred leasing costs and acquisition-related intangible assets | 30,789,000 | [5],[8] | ||||||||
Total assets acquired | 312,150,000 | [5] | 11,222,000 | |||||||
Liabilities | ||||||||||
Deferred revenue and acquisition-related intangible liabilities | 4,190,000 | [5],[9] | ||||||||
Secured debt | 95,496,000 | [10],[5] | 1,750,000 | [11] | ||||||
Accounts payable, accrued expenses, and other liabilities | 422,000 | [5] | 1,952,000 | |||||||
Total liabilities assumed | 100,108,000 | [5] | 3,702,000 | |||||||
Noncontrolling interest | 55,486,000 | 46,303,000 | 4,885,000 | |||||||
Net assets and liabilities acquired | $212,042,000 | [12],[5] | $2,635,000 | |||||||
[1] | We acquired these properties through a new special purpose entity wholly owned by the Finance Partnership. | |||||||||
[2] | In connection with this acquisition, we assumed secured debt with an outstanding principal balance of $83.9 million that was recorded at fair value on the acquisition date, resulting in a premium of approximately $11.6 million (see Note 5). | |||||||||
[3] | As of September 30, 2013, these properties, together the “Heights of Del Mar†project, are temporarily being held in a separate VIE to facilitate potential Section 1031 Exchanges (see Note 1). The $126.4 million purchase price includes $9.4 million for 4.2 acres of undeveloped land the Company acquired in connection with this acquisition. | |||||||||
[4] | Excludes acquisition-related costs and includes assumed tenant improvements. | |||||||||
[5] | The purchase price of the two acquisitions completed during the nine months ended September 30, 2013 were individually less than 5% and in aggregate less than 10% of the Company’s total assets as of September 30, 2013. | |||||||||
[6] | Represents buildings, building improvements and tenant improvements. | |||||||||
[7] | In connection with one of the acquisitions, we acquired undeveloped land of approximately 4.2 acres that was added to the Company’s future development pipeline upon acquisition. | |||||||||
[8] | Represents in-place leases (approximately $19.6Â million with a weighted average amortization period of 4.7Â years), above-market leases (approximately $3.2Â million with a weighted average amortization period of 6.1Â years), and leasing commissions (approximately $7.9Â million with a weighted average amortization period of 5.9Â years). | |||||||||
[9] | Represents below-market leases (approximately $4.2Â million with a weighted average amortization period of 7.7Â years). | |||||||||
[10] | Represents the mortgage loan, which includes an unamortized premium of approximately $11.6 million at the date of acquisition, assumed in connection with the properties acquired in January 2013 (see Note 5). | |||||||||
[11] | This note was repaid as of September 30, 2013. | |||||||||
[12] | Reflects the purchase price net of assumed secured debt and other lease-related obligations. |
Acquisitions_Details_Textuals
Acquisitions (Details Textuals) (USD $) | 9 Months Ended | 9 Months Ended | 9 Months Ended | 1 Months Ended | |||||||||||
Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 27, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Oct. 29, 2013 | ||||
building | In-Place Leases [Member] | Above-Market Leases [Member] | Deferred Leasing Costs [Member] | 6.05% Mortgage Payable Due June 1, 2019 [Member] | Office Properties Acquisitions [Member] | 320 & 321 Westlake Terry, Seattle WA [Member] | 12780 and 12790 El Camino Real, Sandiego, CA [Member] | Redwood City Partners, LLC [Member] | Purchase Price Of Business Combination [Member] | Purchase Price Of Business Combination [Member] | Subsequent Event [Member] | ||||
sqft | Kilroy Realty, L.P. [Member] | building | building | acre | acre | Assets, Total [Member] | Assets, Total [Member] | acre | |||||||
Secured Debt [Member] | building | sqft | Office Properties Acquisitions [Member] | 320 & 321 Westlake Terry, Seattle WA [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Number of buildings | 14 | 4 | 2 | [1],[2] | 2 | [3] | |||||||||
Concentration risk, percentage | 10.00% | 5.00% | |||||||||||||
Principal amount of secured debt | $83,900,000 | ||||||||||||||
Debt premium | 11,600,000 | ||||||||||||||
Deferred leasing costs and acquisition-related intangible assets | 19,600,000 | 3,200,000 | 7,900,000 | 30,789,000 | [4],[5] | ||||||||||
Weighted average amortization period in years for deferred leasing and acquisition-related intangible assets | 4 years 8 months 0 days | 6 years 1 month 0 days | 5 years 11 months 0 days | ||||||||||||
Below Market Lease, Acquired | 4,200,000 | ||||||||||||||
Weighted average amortization period in years for acquisition-related liabilities | 7 years 8 months 0 days | ||||||||||||||
Area of real estate property | 1,159,185 | 300,000 | |||||||||||||
Payments to acquire land | $9,400,000 | $17,000,000 | |||||||||||||
Area of land | 4.2 | 0.35 | 2 | ||||||||||||
[1] | We acquired these properties through a new special purpose entity wholly owned by the Finance Partnership. | ||||||||||||||
[2] | In connection with this acquisition, we assumed secured debt with an outstanding principal balance of $83.9 million that was recorded at fair value on the acquisition date, resulting in a premium of approximately $11.6 million (see Note 5). | ||||||||||||||
[3] | As of September 30, 2013, these properties, together the “Heights of Del Mar†project, are temporarily being held in a separate VIE to facilitate potential Section 1031 Exchanges (see Note 1). The $126.4 million purchase price includes $9.4 million for 4.2 acres of undeveloped land the Company acquired in connection with this acquisition. | ||||||||||||||
[4] | The purchase price of the two acquisitions completed during the nine months ended September 30, 2013 were individually less than 5% and in aggregate less than 10% of the Company’s total assets as of September 30, 2013. | ||||||||||||||
[5] | Represents in-place leases (approximately $19.6Â million with a weighted average amortization period of 4.7Â years), above-market leases (approximately $3.2Â million with a weighted average amortization period of 6.1Â years), and leasing commissions (approximately $7.9Â million with a weighted average amortization period of 5.9Â years). |
Deferred_Leasing_Costs_and_Acq2
Deferred Leasing Costs and Acquisition-related Intangible Assets and Liabilities, net (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | ||
In Thousands, unless otherwise specified | ||||
Deferred Leasing Costs and Acquisition-related Intangible Assets, Net | ||||
Total deferred leasing costs and acquisition-related intangible assets, net | $190,085 | $189,968 | ||
Acquisition-related Intangible Liabilities, Net | ||||
Total acquisitions-related intangible liabilities, net | 53,014 | [1] | 59,129 | [1] |
Deferred Leasing Costs [Member] | ||||
Deferred Leasing Costs and Acquisition-related Intangible Assets, Net | ||||
Finite-lived intangible assets, gross | 170,609 | 168,087 | ||
Finite-lived intangible assets accumulated amortization | -59,943 | -61,443 | ||
Finite-lived intangible assets, net | 110,666 | 106,644 | ||
Above-Market Leases [Member] | ||||
Deferred Leasing Costs and Acquisition-related Intangible Assets, Net | ||||
Finite-lived intangible assets, gross | 28,842 | 27,977 | ||
Finite-lived intangible assets accumulated amortization | -14,038 | -12,180 | ||
Finite-lived intangible assets, net | 14,804 | [2] | 15,797 | |
In-Place Leases [Member] | ||||
Deferred Leasing Costs and Acquisition-related Intangible Assets, Net | ||||
Finite-lived intangible assets, gross | 108,612 | 101,061 | ||
Finite-lived intangible assets accumulated amortization | -44,476 | -34,019 | ||
Finite-lived intangible assets, net | 64,136 | 67,042 | ||
Below Market Ground Lease Obligation [Member] | ||||
Deferred Leasing Costs and Acquisition-related Intangible Assets, Net | ||||
Finite-lived intangible assets, gross | 490 | 690 | ||
Finite-lived intangible assets accumulated amortization | -11 | -205 | ||
Finite-lived intangible assets, net | 479 | [3] | 485 | |
Below Market Lease [Member] | ||||
Acquisition-related Intangible Liabilities, Net | ||||
FiniteLivedIntangibleLiabilitiesGross | 70,966 | 70,486 | ||
Accumulated amortization | -24,074 | -17,555 | ||
Acquisition-related Intangible Liabilities, net | 46,892 | [1],[4] | 52,931 | [1] |
Above-Market Ground Lease Obligation [Member] | ||||
Acquisition-related Intangible Liabilities, Net | ||||
FiniteLivedIntangibleLiabilitiesGross | 6,320 | 6,320 | ||
Accumulated amortization | -198 | -122 | ||
Acquisition-related Intangible Liabilities, net | $6,122 | [1],[5] | $6,198 | [1] |
[1] | Included in deferred revenue and acquisition-related intangible liabilities, net in the consolidated balance sheets. | |||
[2] | Represents estimated annual amortization related to above-market operating leases. Amounts will be recorded as a decrease to rental income in the consolidated statements of operations. | |||
[3] | Represents estimated annual amortization related to below-market ground lease obligations. Amounts will be recorded as an increase to ground lease expense in the consolidated statements of operations. | |||
[4] | Represents estimated annual amortization related to below-market operating leases. Amounts will be recorded as an increase to rental income in the consolidated statements of operations. | |||
[5] | Represents estimated annual amortization related to above-market ground lease obligations. Amounts will be recorded as a decrease to ground lease expense in the consolidated statements of operations. |
Deferred_Leasing_Costs_and_Acq3
Deferred Leasing Costs and Acquisition-related Intangible Assets and Liabilities, net (Details 1) (USD $) | 3 Months Ended | 9 Months Ended | ||||||||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | |||||
Amortization for the period related to deferred leasing costs and acquisition-related intangibles | ||||||||||
Amortization for the period related to deferred leasing costs and acquisition-related intangible assets | $12,661 | $9,716 | $37,343 | $24,461 | ||||||
Deferred Leasing Costs [Member] | ||||||||||
Amortization for the period related to deferred leasing costs and acquisition-related intangibles | ||||||||||
Amortization for the period related to deferred leasing costs and acquisition-related intangible assets | 6,945 | [1] | 5,238 | [1] | 20,882 | [1] | 14,126 | [1] | ||
Estimated annual amortization related to acquisition-related intangibles | ||||||||||
Remaining 2013 | 6,384 | 6,384 | ||||||||
2014 | 23,533 | 23,533 | ||||||||
2015 | 19,669 | 19,669 | ||||||||
2016 | 16,920 | 16,920 | ||||||||
2017 | 14,468 | 14,468 | ||||||||
Thereafter | 29,692 | 29,692 | ||||||||
Finite-lived intangible assets, net | 110,666 | 110,666 | 106,644 | |||||||
Above-Market Leases [Member] | ||||||||||
Amortization for the period related to deferred leasing costs and acquisition-related intangibles | ||||||||||
Amortization for the period related to deferred leasing costs and acquisition-related intangible assets | 1,417 | [2] | 1,459 | [2] | 4,214 | [2] | 4,205 | [2] | ||
Estimated annual amortization related to acquisition-related intangibles | ||||||||||
Remaining 2013 | 1,367 | [3] | 1,367 | [3] | ||||||
2014 | 4,837 | [3] | 4,837 | [3] | ||||||
2015 | 3,035 | [3] | 3,035 | [3] | ||||||
2016 | 2,007 | [3] | 2,007 | [3] | ||||||
2017 | 1,690 | [3] | 1,690 | [3] | ||||||
Thereafter | 1,868 | [3] | 1,868 | [3] | ||||||
Finite-lived intangible assets, net | 14,804 | [3] | 14,804 | [3] | 15,797 | |||||
In-Place Leases [Member] | ||||||||||
Amortization for the period related to deferred leasing costs and acquisition-related intangibles | ||||||||||
Amortization for the period related to deferred leasing costs and acquisition-related intangible assets | 7,677 | [1] | 6,479 | [1] | 22,546 | [1] | 14,858 | [1] | ||
Estimated annual amortization related to acquisition-related intangibles | ||||||||||
Remaining 2013 | 6,549 | 6,549 | ||||||||
2014 | 19,053 | 19,053 | ||||||||
2015 | 12,676 | 12,676 | ||||||||
2016 | 9,445 | 9,445 | ||||||||
2017 | 7,744 | 7,744 | ||||||||
Thereafter | 8,669 | 8,669 | ||||||||
Finite-lived intangible assets, net | 64,136 | 64,136 | 67,042 | |||||||
Below Market Ground Lease Obligation [Member] | ||||||||||
Amortization for the period related to deferred leasing costs and acquisition-related intangibles | ||||||||||
Amortization for the period related to deferred leasing costs and acquisition-related intangible assets | 2 | [4] | 52 | [4] | 6 | [4] | 153 | [4] | ||
Estimated annual amortization related to acquisition-related intangibles | ||||||||||
Remaining 2013 | 2 | [5] | 2 | [5] | ||||||
2014 | 8 | [5] | 8 | [5] | ||||||
2015 | 8 | [5] | 8 | [5] | ||||||
2016 | 8 | [5] | 8 | [5] | ||||||
2017 | 8 | [5] | 8 | [5] | ||||||
Thereafter | 445 | [5] | 445 | [5] | ||||||
Finite-lived intangible assets, net | 479 | [5] | 479 | [5] | 485 | |||||
Below Market Leases [Member] | ||||||||||
Amortization for the period related to deferred leasing costs and acquisition-related intangibles | ||||||||||
Amortization for the period related to acquistion-related liabilities | -3,355 | [6] | -3,487 | [6] | -10,229 | [6] | -8,821 | [6] | ||
Estimated annual amortization related to acquisition-related intangibles | ||||||||||
Remaining 2013 | -3,201 | [7] | -3,201 | [7] | ||||||
2014 | -11,903 | [7] | -11,903 | [7] | ||||||
2015 | -9,385 | [7] | -9,385 | [7] | ||||||
2016 | -7,195 | [7] | -7,195 | [7] | ||||||
2017 | -6,127 | [7] | -6,127 | [7] | ||||||
Thereafter | -9,081 | [7] | -9,081 | [7] | ||||||
Acquisition-related Intangible Liabilities, net | -46,892 | [7],[8] | -46,892 | [7],[8] | -52,931 | [8] | ||||
Above-Market Ground Lease Obligation [Member] | ||||||||||
Amortization for the period related to deferred leasing costs and acquisition-related intangibles | ||||||||||
Amortization for the period related to acquistion-related liabilities | -25 | [9] | -25 | [9] | -76 | [9] | -60 | [9] | ||
Estimated annual amortization related to acquisition-related intangibles | ||||||||||
Remaining 2013 | -25 | [10] | -25 | [10] | ||||||
2014 | -101 | [10] | -101 | [10] | ||||||
2015 | -101 | [10] | -101 | [10] | ||||||
2016 | -101 | [10] | -101 | [10] | ||||||
2017 | -101 | [10] | -101 | [10] | ||||||
Thereafter | -5,693 | [10] | -5,693 | [10] | ||||||
Acquisition-related Intangible Liabilities, net | ($6,122) | [10],[8] | ($6,122) | [10],[8] | ($6,198) | [8] | ||||
[1] | The amortization of deferred leasing costs and in-place leases is recorded to depreciation and amortization expense in the consolidated statements of operations for the periods presented. | |||||||||
[2] | The amortization of above-market operating leases is recorded as a decrease to rental income in the consolidated statements of operations for the periods presented. | |||||||||
[3] | Represents estimated annual amortization related to above-market operating leases. Amounts will be recorded as a decrease to rental income in the consolidated statements of operations. | |||||||||
[4] | The amortization of the below-market ground lease obligation is recorded as an increase to ground lease expense in the consolidated statements of operations for the periods presented. | |||||||||
[5] | Represents estimated annual amortization related to below-market ground lease obligations. Amounts will be recorded as an increase to ground lease expense in the consolidated statements of operations. | |||||||||
[6] | The amortization of below-market operating leases is recorded as an increase to rental income in the consolidated statements of operations for the periods presented. | |||||||||
[7] | Represents estimated annual amortization related to below-market operating leases. Amounts will be recorded as an increase to rental income in the consolidated statements of operations. | |||||||||
[8] | Included in deferred revenue and acquisition-related intangible liabilities, net in the consolidated balance sheets. | |||||||||
[9] | The amortization of the above-market ground lease obligation is recorded as a decrease to ground lease expense in the consolidated statements of operations for the periods presented. | |||||||||
[10] | Represents estimated annual amortization related to above-market ground lease obligations. Amounts will be recorded as a decrease to ground lease expense in the consolidated statements of operations. |
Receivables_Details
Receivables (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | |
In Thousands, unless otherwise specified | |||
Current Receivables, net | |||
Current receivables | $14,301 | $11,801 | |
Allowance for uncollectible tenant receivables | -2,532 | -2,581 | |
Current receivables, net | 11,769 | [1] | 9,220 |
Deferred Rent Receivables, net | |||
Deferred rent receivables | 123,632 | 118,025 | |
Allowance for deferred rent receivables | -1,973 | -2,607 | |
Deferred rent receivables, net | $121,659 | [2] | $115,418 |
[1] | Excludes current receivables, net related to properties held for sale at September 30, 2013. | ||
[2] | Excludes deferred rent receivables, net related to properties held for sale at September 30, 2013. |
Secured_and_Unsecured_Debt_of_2
Secured and Unsecured Debt of the Operating Partnership (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | ||||
Debt Instrument [Line Items] | ||||||
Secured Debt | $563,898,000 | [1] | $563,898,000 | [1] | $561,096,000 | [1] |
Kilroy Realty, L.P. [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Secured Debt | 563,898,000 | 563,898,000 | 561,096,000 | |||
Kilroy Realty, L.P. [Member] | Secured Debt [Member] | 4.27% Mortgage Payable due Feb. 01, 2018 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Annual Stated Interest Rate | 4.27% | [2] | 4.27% | [2] | ||
GAAP Effective Rate | 4.27% | [2],[3] | 4.27% | [2],[3] | ||
Maturity Date | 1-Feb-18 | |||||
Secured Debt | 133,689,000 | [1] | 133,689,000 | [1] | 135,000,000 | [1] |
Kilroy Realty, L.P. [Member] | Secured Debt [Member] | 4.48% Mortgage Payable due July 1, 2027 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Annual Stated Interest Rate | 4.48% | [2] | 4.48% | [2] | ||
GAAP Effective Rate | 4.48% | [2],[3] | 4.48% | [2],[3] | ||
Maturity Date | 1-Jul-27 | |||||
Secured Debt | 97,000,000 | [1],[4] | 97,000,000 | [1],[4] | 97,000,000 | [1],[4] |
Kilroy Realty, L.P. [Member] | Secured Debt [Member] | 6.05% Mortgage Payable Due June 1, 2019 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Annual Stated Interest Rate | 6.05% | [2] | 6.05% | [2] | ||
GAAP Effective Rate | 3.50% | [2],[3] | 3.50% | [2],[3] | ||
Maturity Date | 1-Jun-19 | |||||
Secured Debt | 93,306,000 | [1],[4],[5] | 93,306,000 | [1],[4],[5] | 0 | [1],[4],[5] |
Principal amount of secured debt | 83,900,000 | 83,900,000 | ||||
Debt premium | 11,600,000 | 11,600,000 | ||||
Amortization period of debt | 6 years 5 months | |||||
Kilroy Realty, L.P. [Member] | Secured Debt [Member] | 6.37% Mortgage Payable due April 01, 2013 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Annual Stated Interest Rate | 6.37% | [2] | 6.37% | [2] | ||
GAAP Effective Rate | 3.55% | [2],[3] | 3.55% | [2],[3] | ||
Maturity Date | 1-Apr-13 | |||||
Secured Debt | 0 | [1],[6] | 0 | [1],[6] | 83,116,000 | [1],[6] |
Kilroy Realty, L.P. [Member] | Secured Debt [Member] | 6.51% Mortgage Payable due Feb. 01, 2017 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Annual Stated Interest Rate | 6.51% | [2] | 6.51% | [2] | ||
GAAP Effective Rate | 6.51% | [2],[3] | 6.51% | [2],[3] | ||
Maturity Date | 1-Feb-17 | |||||
Secured Debt | 67,907,000 | [1] | 67,907,000 | [1] | 68,615,000 | [1] |
Kilroy Realty, L.P. [Member] | Secured Debt [Member] | 5.23% Mortgage Payable due Jan. 01, 2016 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Annual Stated Interest Rate | 5.23% | [2] | 5.23% | [2] | ||
GAAP Effective Rate | 3.50% | [2],[3] | 3.50% | [2],[3] | ||
Maturity Date | 1-Jan-16 | |||||
Secured Debt | 55,007,000 | [1],[4] | 55,007,000 | [1],[4] | 56,302,000 | [1],[4] |
Kilroy Realty, L.P. [Member] | Secured Debt [Member] | 5.57% Morgage Payable Due Feb. 11, 2016 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Annual Stated Interest Rate | 5.57% | [2] | 5.57% | [2] | ||
GAAP Effective Rate | 3.25% | [2],[3] | 3.25% | [2],[3] | ||
Maturity Date | 11-Feb-16 | |||||
Secured Debt | 41,999,000 | [1],[4] | 41,999,000 | [1],[4] | 43,016,000 | [1],[4] |
Kilroy Realty, L.P. [Member] | Secured Debt [Member] | 5.09% Mortgage Payable due Aug. 7, 2015 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Annual Stated Interest Rate | 5.09% | [2] | 5.09% | [2] | ||
GAAP Effective Rate | 3.50% | [2],[3] | 3.50% | [2],[3] | ||
Maturity Date | 7-Aug-15 | |||||
Secured Debt | 34,979,000 | [1],[4] | 34,979,000 | [1],[4] | 35,379,000 | [1],[4] |
Kilroy Realty, L.P. [Member] | Secured Debt [Member] | 4.94% Mortgage Payable due April 15, 2015 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Annual Stated Interest Rate | 4.94% | [2] | 4.94% | [2] | ||
GAAP Effective Rate | 4.00% | [2],[3] | 4.00% | [2],[3] | ||
Maturity Date | 15-Apr-15 | |||||
Secured Debt | 27,970,000 | [1],[4] | 27,970,000 | [1],[4] | 28,941,000 | [1],[4] |
Kilroy Realty, L.P. [Member] | Secured Debt [Member] | 7.15% Mortgage Payable due May 01, 2017 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Annual Stated Interest Rate | 7.15% | [2] | 7.15% | [2] | ||
GAAP Effective Rate | 7.15% | [2],[3] | 7.15% | [2],[3] | ||
Maturity Date | 1-May-17 | |||||
Secured Debt | 9,546,000 | [1] | 9,546,000 | [1] | 11,210,000 | [1] |
Kilroy Realty, L.P. [Member] | Secured Debt [Member] | Municipal Bonds [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Secured Debt | $2,495,000 | [1] | $2,495,000 | [1] | $2,517,000 | [1] |
[1] | Amounts reported include the amounts of unamortized debt premiums and discounts for the periods presented. | |||||
[2] | All interest rates presented are fixed-rate interest rates. | |||||
[3] | This represents the rate at which interest expense is recorded for financial reporting purposes, which reflects the amortization of discounts/premiums, excluding debt issuance costs. | |||||
[4] | The secured debt and the related properties that secure the debt are held in a special purpose entity and the properties are not available to satisfy the debts and other obligations of the Company or the Operating Partnership. | |||||
[5] | In January 2013, in connection with the acquisition of two office buildings in Seattle, Washington, we assumed a mortgage loan that is secured by the project. The assumed mortgage had a principal balance of $83.9 million at the acquisition date and was recorded at fair value on the date of the acquisition resulting in a premium of approximately $11.6 million. The loan requires monthly principal and interest payments based on a 6.4 year amortization period. | |||||
[6] | In January 2013, we repaid this loan prior to the stated maturity date. |
Secured_and_Unsecured_Debt_of_3
Secured and Unsecured Debt of the Operating Partnership (Details 1) (USD $) | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | ||||
Debt Instrument [Line Items] | ||||||||
Unsecured debt | $1,431,048,000 | $1,431,048,000 | $1,130,895,000 | |||||
Balance and significant terms of the Exchangeable Notes outstanding | ||||||||
Net carrying amount of liability component | 167,236,000 | 167,236,000 | 163,944,000 | |||||
Per Share Average Trading Price Of Companys Common Stock On Stock Exchange Abstract | ||||||||
Average trading price of the Companys stock | $51.57 | $47.56 | $52.42 | $45.74 | ||||
Kilroy Realty, L.P. [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Unsecured debt | 1,431,048,000 | 1,431,048,000 | 1,130,895,000 | |||||
Balance and significant terms of the Exchangeable Notes outstanding | ||||||||
Net carrying amount of liability component | 167,236,000 | 167,236,000 | 163,944,000 | |||||
Kilroy Realty, L.P. [Member] | Secured Debt [Member] | 6.05% Mortgage Payable Due June 1, 2019 [Member] | ||||||||
Balance and significant terms of the Exchangeable Notes outstanding | ||||||||
Maturity Date | 1-Jun-19 | |||||||
Stated coupon rate | 6.05% | [1] | 6.05% | [1] | ||||
Effective interest rate | 3.50% | [1],[2] | 3.50% | [1],[2] | ||||
Kilroy Realty, L.P. [Member] | Exchangeable Notes [Member] | ||||||||
Interest Expense for the Exchangeable Notes | ||||||||
Contractual interest payments | 1,833,000 | 1,833,000 | 5,498,000 | 6,888,000 | [3] | |||
Amortization of discount | 1,116,000 | 1,041,000 | 3,291,000 | 3,993,000 | [3] | |||
Interest expense attributable to the Exchangeable Notes | 2,949,000 | 2,874,000 | 8,789,000 | 10,881,000 | [3] | |||
Kilroy Realty, L.P. [Member] | Exchangeable Notes [Member] | 4.25% Exchangeable Notes [Member] | ||||||||
Balance and significant terms of the Exchangeable Notes outstanding | ||||||||
Principal amount | 172,500,000 | 172,500,000 | 172,500,000 | 172,500,000 | 172,500,000 | |||
Unamortized discount | -5,264,000 | -5,264,000 | -8,556,000 | |||||
Net carrying amount of liability component | 167,236,000 | 167,236,000 | 163,944,000 | |||||
Carrying amount of equity component | 19,835,000 | 19,835,000 | ||||||
Stated coupon rate | 4.25% | [4] | 4.25% | [4] | ||||
Effective interest rate | 7.13% | [5] | 7.13% | [5] | ||||
Exchange rate per $1,000 principal value of the Exchangeable Notes, as adjusted | 27.8307 | [6] | ||||||
Exchange price, as adjusted | $35.93 | [6] | ||||||
Number of Shares on which aggregate consideration to be delivered upon conversion is determined | 4,800,796 | [6] | ||||||
Minimum percentage of exchange price | 130.00% | |||||||
Per Share Average Trading Price Of Companys Common Stock On Stock Exchange Abstract | ||||||||
Fair Value Of Shares Upon Conversion If Exchangeable Notes Were Converted On Specified Date | 245,200,000 | 225,100,000 | 248,000,000 | 218,600,000 | ||||
Debt Instrument, Convertible, If-converted Value in Excess of Principal | 72,700,000 | 52,600,000 | 75,500,000 | 46,100,000 | ||||
Capped call transactions | ||||||||
Referenced shares of common stock | 4,800,796 | 4,800,796 | ||||||
Exchange price including effect of capped calls | $42.81 | $42.81 | ||||||
[1] | All interest rates presented are fixed-rate interest rates. | |||||||
[2] | This represents the rate at which interest expense is recorded for financial reporting purposes, which reflects the amortization of discounts/premiums, excluding debt issuance costs. | |||||||
[3] | The Company repaid the 3.25% Exchangeable Notes in April 2012. Interest payments and discount amortization for the three and nine months ended September 30, 2013 and three months ended September 30, 2012 are solely attributable to the 4.25% Exchangeable Notes. | |||||||
[4] | Interest on the 4.25% Exchangeable Notes is payable semi-annually in arrears on May 15th and November 15th of each year. | |||||||
[5] | The rate at which we record interest expense for financial reporting purposes, which reflects the amortization of the discounts on the 4.25%Â Exchangeable Notes. This rate represents our conventional debt borrowing rate at the date of issuance. | |||||||
[6] | The exchange rate, exchange price, and the number of shares to be delivered upon conversion are subject to adjustment under certain circumstances including increases in our common dividends. |
Unsecured_Senior_Notes_Details
Unsecured Senior Notes (Details 2) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 |
In Thousands, unless otherwise specified | Kilroy Realty, L.P. [Member] | Kilroy Realty, L.P. [Member] | Kilroy Realty, L.P. [Member] | ||
Unsecured Senior Notes, 3.8%, Due 2023 [Member] | |||||
Senior Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Unsecured debt | $1,431,048 | $1,130,895 | $1,431,048 | $1,130,895 | $300,000 |
Maturity Date | 15-Jan-23 | ||||
Stated coupon rate | 3.80% | ||||
Debt Instrument, Unamortized Discount | $100 |
Unsecured_Revolving_Credit_Fac
Unsecured Revolving Credit Facility (Details 3) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | |||
Kilroy Realty, L.P. [Member] | Kilroy Realty, L.P. [Member] | Kilroy Realty, L.P. [Member] | Kilroy Realty, L.P. [Member] | Kilroy Realty, L.P. [Member] | Kilroy Realty, L.P. [Member] | ||||||
Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Revolving Credit Facility [Member] | Line of Credit [Member] | ||||||||
Line of Credit Facility [Line Items] | |||||||||||
Unsecured debt additional borrowing amount | $200,000,000 | ||||||||||
Terms of the Credit Facility | |||||||||||
Unsecured line of credit | 0 | 185,000,000 | 0 | 185,000,000 | 0 | 0 | 185,000,000 | ||||
Remaining borrowing capacity | 500,000,000 | 500,000,000 | 315,000,000 | ||||||||
Total borrowing capacity | 500,000,000 | [1] | 500,000,000 | [1] | 500,000,000 | [1] | |||||
Interest rate | 1.66% | [2] | |||||||||
Facility fee - annual rate | 0.30% | [3] | |||||||||
Maturity date | 3-Apr-17 | [4] | |||||||||
Debt Instrument, Basis Spread on Variable Rate | 1.45% | ||||||||||
Debt Issuance Cost | $10,200,000 | ||||||||||
[1] | We may elect to borrow, subject to bank approval, up to an additional $200.0Â million under an accordion feature under the terms of the revolving credit facility. | ||||||||||
[2] | The revolving credit facility interest rate was calculated based on an annual rate of LIBOR plus 1.450% as of both September 30, 2013 and December 31, 2012. No interest rate is shown as of September 30, 2013 because no borrowings were outstanding. | ||||||||||
[3] | The facility fee is paid on a quarterly basis and is calculated based on the total borrowing capacity. In addition to the facility fee, from 2010 to 2012 we incurred debt origination and legal costs totaling approximately $10.2Â million that are currently being amortized through the maturity date of the revolving credit facility. | ||||||||||
[4] | Under the terms of the revolving credit facility, we may exercise an option to extend the maturity date by one year. |
Debt_Maturities_Details_4
Debt Maturities (Details 4) (Debt [Member], Kilroy Realty, L.P. [Member], USD $) | Sep. 30, 2013 | |
Debt [Member] | Kilroy Realty, L.P. [Member] | ||
Stated debt maturities and scheduled amortization payments, excluding debt discounts | ||
Remaining 2013 | $2,387,000 | |
2014 | 265,346,000 | |
2015 | 395,104,000 | |
2016 | 249,431,000 | |
2017 | 71,748,000 | |
Thereafter | 1,169,742,000 | |
Total | 2,153,758,000 | [1] |
Unamortized discount (premium) | ($8,400,000) | |
[1] | Includes gross principal balance of outstanding debt before impact of net unamortized premiums totaling approximately $8.4 million. |
Secured_and_Unsecured_Debt_of_4
Secured and Unsecured Debt of the Operating Partnership Capitalized Interest and Loan Fees (Details 5) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Capitalized Interest and Loan Fees [Line Items] | ||||
Interest Expense | $18,853 | $19,854 | $58,021 | $60,172 |
Kilroy Realty, L.P. [Member] | ||||
Capitalized Interest and Loan Fees [Line Items] | ||||
Gross interest expense | 27,942 | 24,843 | 83,322 | 73,326 |
Capitalized interest | -9,089 | -4,989 | -25,301 | -13,154 |
Interest Expense | $18,853 | $19,854 | $58,021 | $60,172 |
Noncontrolling_Interests_on_th1
Noncontrolling Interests on the Company's Consolidated Financial Statements (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2012 |
Noncontrolling Interest [Abstract] | |||
Percentage of general partnership interest owned by the company in the Operating Partnership | 97.80% | 97.60% | 97.60% |
Percentage of Common limited partnership interest owned by certain non-affiliated investors and certain directors and officers of the Company in the Operating Partnership | 2.20% | 2.40% | 2.40% |
Common units outstanding held by common limited partners | 1,821,503 | 1,826,503 | 1,826,503 |
Common stock, par value | $0.01 | ||
Aggregate value upon redemption of outstanding noncontrolling common units | $92,300,000 | $85,400,000 | |
Noncontrolling Interest in consolidated subsidiary (Notes 2 and 6) | $4,885,000 | $0 |
Stockholders_Equity_of_the_Com2
Stockholders' Equity of the Company (Details) (USD $) | 9 Months Ended | 0 Months Ended | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 18, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | |
Common Stock [Member] | Common Stock [Member] | Issuance of Equity - equity offering [Domain] | Issuance of Equity - at the market ofering [Member] | Issuance of Equity - at the market ofering [Member] | Issuance of Equity - at the market ofering [Member] | |||
Common Stock [Member] | Common Stock [Member] | Common Stock [Member] | ||||||
Common Stock of the Company [Abstract] | ||||||||
Issuance of common stock, shares | 6,175,000 | 226,430 | 1,040,838 | |||||
Proceeds from Issuance of Common stock, net | $295,900,000 | $11,400,000 | $54,400,000 | |||||
At the Market Stock Offering Program Aggregate Value Of Common Stock | 200,000,000 | |||||||
Average price per common shares sold | $51.12 | $53.11 | ||||||
Net proceeds from issuance of common stock (Note 7) | 349,951,000 | 662,371,000 | 11,600,000 | 55,300,000 | ||||
Common stock, shares issued | 82,113,491 | 74,926,981 | 2,183,261 | |||||
At Market Stock Aggregate Gross Sales Price of Common Stock | 105,300,000 | 105,300,000 | ||||||
At the Market Stock Offering Program Remained Available For Issuance | $94,700,000 |
Partners_Capital_of_the_Operat2
Partners' Capital of the Operating Partnership (Details) (USD $) | 9 Months Ended | 0 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Sep. 18, 2013 | Sep. 18, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | |
Kilroy Realty, L.P. [Member] | Kilroy Realty, L.P. [Member] | Kilroy Realty, L.P. [Member] | Issuance of Equity - equity offering [Domain] | Capital Units [Member] | Issuance of Equity - at the market ofering [Member] | Issuance of Equity - at the market ofering [Member] | Issuance of Equity - at the market ofering [Member] | Issuance of Equity - at the market ofering [Member] | ||||
Capital Units [Member] | Capital Units [Member] | Capital Units [Member] | Common Stock [Member] | Common Stock [Member] | Common Stock [Member] | Capital Units [Member] | Capital Units [Member] | |||||
General Partners' Capital Account [Abstract] | ||||||||||||
Issuance of common stock, shares | 6,175,000 | 226,430 | 1,040,838 | |||||||||
Proceeds from Issuance of Common stock, net | $295,900,000 | $11,400,000 | $54,400,000 | |||||||||
Net proceeds from issuance of common stock | $349,951,000 | $662,371,000 | $11,600,000 | $55,300,000 | ||||||||
Partners' Capital Account, Units, Sold in Public Offering | 6,175,000 | 226,430 | 1,040,838 | |||||||||
General Partners' Capital Account, Units Outstanding | 82,113,491 | 74,926,981 | 74,692,939 | |||||||||
Noncontrolling Interest, Ownership Percentage by Parent | 97.80% | 97.60% | 97.60% | |||||||||
Common units held by limited partners | 1,821,503 | 1,826,503 | 1,826,503 | |||||||||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 2.20% | 2.40% | 2.40% |
ShareBased_Compensation_Market
Share-Based Compensation Market Measure-based RSU Grant (Details) (Market Measure-Based Restricted Stock Units (RSUs) [Member], USD $) | 9 Months Ended | 0 Months Ended | 9 Months Ended | 9 Months Ended | 9 Months Ended | ||||||||
Sep. 30, 2012 | Mar. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | |||||
Chief Executive Officer [Member] | Chief Executive Officer [Member] | Weighted Average Grant Date Fair Value Per Share [Member] | Vested Restricted Stock Units R S U [Member] | Vested Restricted Stock Units R S U [Member] | Restricted Stock Units (RSUs) [Member] | Restricted Stock Units (RSUs) [Member] | Nonvested Restricted Stock Units R S U [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award, Equity Instruments Other Than Options, Vested, Number | 14,748 | 14,748 | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding, Number | 174,108 | 103,239 | |||||||||||
Expected Volatility Rate | 27.00% | ||||||||||||
Risk Free Interest Rate | 0.90% | ||||||||||||
Expected Dividend Rate | 3.60% | ||||||||||||
Expected Term | 6 years | ||||||||||||
Outstanding, Jan. 01, 2013 | 88,491 | ||||||||||||
Granted | 103,239 | 103,239 | 0 | 9,542 | 9,542 | ||||||||
Vested | 0 | 0 | 0 | 0 | |||||||||
Settled | 0 | 0 | 0 | ||||||||||
Issuance of dividend equivalents | 0 | 0 | 0 | ||||||||||
Modified from time based | 0 | [1] | 61,327 | [1] | 61,327 | [1] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures and Expirations in Period | 0 | 0 | |||||||||||
Outstanding, Sept. 30, 2013 | 159,360 | ||||||||||||
Oustanding, Jan. 01, 2013 | $41.20 | ||||||||||||
Granted | $41.20 | $44.55 | $44.55 | ||||||||||
Vested | $0 | $0 | |||||||||||
Modified from time based | $53.05 | [1] | |||||||||||
Oustanding, Sept. 30, 2013 | $45.96 | ||||||||||||
[1] | On April 4, 2013 the terms of time-based RSU’s granted to certain officers of the Company in January were modified to include market-measure and performance-based vesting requirements. |
ShareBased_Compensation_Timeba
Share-Based Compensation Time-based RSUs (Details) (Time-Based Restricted Stock Units (RSUs) [Member], USD $) | 9 Months Ended | ||||||||||||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | |||||
Nonvested Shares [Member] | Nonvested Shares [Member] | Vested Restricted Stock Units R S U [Member] | Vested Restricted Stock Units R S U [Member] | Restricted Stock Units (RSUs) [Member] | Restricted Stock Units (RSUs) [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding, Number | 1,167,573 | 1,048,863 | |||||||||||
Share Based Compensation Arrangement By Share Based Payment Award, Equity Instruments Other Than Options, Vested, Number | 849,614 | 769,761 | |||||||||||
Outstanding, Jan. 01, 2013 | 279,102 | ||||||||||||
Granted | 173,758 | 204,829 | 0 | 173,758 | |||||||||
Vested | -73,574 | -73,574 | -58,940 | 0 | |||||||||
Settled | -10,342 | [1] | -10,342 | [1] | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award Equity Instruments Other Than Options Issuance Of Dividend Equivalents In Period | 20,421 | [2] | 20,421 | [2] | |||||||||
Modified to time based | -61,327 | [3] | 0 | [3] | 61,327 | [3] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures and Expirations in Period | 3,800 | [1],[4] | 3,800 | [1],[4] | |||||||||
Outstanding, Sept. 30, 2013 | 317,959 | ||||||||||||
Oustanding, Jan. 01, 2013 | $41.30 | ||||||||||||
Granted | $49.45 | $44.34 | |||||||||||
Vested | $38.80 | ||||||||||||
Modified to time based | $53.05 | [3] | |||||||||||
Oustanding, Sept. 30, 2013 | $46.13 | ||||||||||||
Total Fair Value | $3,677 | [5] | $2,420 | [5] | |||||||||
[1] | Represents vested RSUs that are settled in cash or shares of the Company’s common stock. | ||||||||||||
[2] | RSUs issued as dividend equivalents are vested upon issuance. | ||||||||||||
[3] | During the second quarter the terms of time-based RSUs granted to certain officers of the Company in January were modified to include market-measure based vesting requirements. | ||||||||||||
[4] | We accept the return of RSUs, at the current quoted closing share price of the Company’s common stock, to satisfy minimum statutory tax-withholding requirements related to either the issuance, vesting or settlement of RSUs in accordance with the terms of the 2006 Plan. | ||||||||||||
[5] | Total fair value of RSUs vested was calculated based on the quoted closing share price of the Company’s common stock on the NYSE on the day of vesting. |
ShareBased_Compensation_Nonves
Share-Based Compensation Nonvested Shares (Details) (Restricted Stock [Member], USD $) | 3 Months Ended | 9 Months Ended | |||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Granted | 62,137 | ||||
Vested | -35,623 | ||||
Granted | $41.84 | ||||
Shares Paid for Tax Withholding for Share Based Compensation | 20,880 | ||||
Total Fair Value | $2,290 | [1] | $1 | [1] | |
Nonvested Shares [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Outstanding, Jan. 01, 2013 | 95,241 | ||||
Granted | 0 | ||||
Vested | -47,291 | [2] | |||
Outstanding, Sept. 30, 2013 | 47,950 | 47,950 | |||
Weighted Average Grant Date Fair Value Per Share [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Oustanding, Jan. 01, 2013 | $40.42 | ||||
Granted | $0 | ||||
Vested | $39.12 | ||||
Oustanding, Sept. 30, 2013 | 41.71 | $41.71 | |||
[1] | Total fair value of shares vested was calculated based on the quoted closing share price of the Company’s common stock on the NYSE on the date of vesting. | ||||
[2] | The total shares vested include 20,880 shares that were tendered in accordance with the terms of the 2006 Plan to satisfy minimum statutory tax withholding requirements related to the restricted shares that have vested. We accept the return of shares at the current quoted closing share price of the Company’s common stock to satisfy tax obligations. |
ShareBased_Compensation_Stock_
Share-Based Compensation Stock Options (Details) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Dec. 31, 2012 |
In Millions, except Share data, unless otherwise specified | Stock Options [Member] | Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Outstanding, Jan. 01, 2013 | 1,525,000 | 1,540,000 | 1,540,000 | |
Granted | 0 | |||
Exercise | -3,000 | |||
Forfeited | -12,000 | |||
Outstanding, Sept. 30, 2013 | 1,525,000 | 1,540,000 | 1,525,000 | |
Outstanding, Jan. 01, 2013 | $42.61 | $42.61 | ||
Granted | $0 | |||
Exercise | $42.61 | |||
Forfeited | $42.61 | |||
Outstanding, Sept. 30, 2013 | $42.61 | $42.61 | ||
Weighted Average Remaining Contractual Term (years) | 8 years 5 months | |||
Options Exercisable | 305,000 | |||
Intrinsic Value | $11.20 |
ShareBased_Compensation_Detail
Share-Based Compensation (Details Textuals) (USD $) | 3 Months Ended | 9 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | |||||||||
In Millions, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Apr. 04, 2013 | Apr. 04, 2013 | Apr. 04, 2013 | Mar. 30, 2012 | Sep. 30, 2013 | |
Full Value Awards [Member] | Restricted Stock [Member] | Time-Based Restricted Stock Units (RSUs) [Member] | Market Measure-Based Restricted Stock Units (RSUs) [Member] | Chief Executive Officer [Member] | Chief Executive Officer [Member] | Chief Executive Officer [Member] | Chief Executive Officer [Member] | Chief Executive Officer [Member] | ||||||
Restricted Stock [Member] | Time-Based Restricted Stock Units (RSUs) [Member] | Market Measure-Based Restricted Stock Units (RSUs) [Member] | Market Measure-Based Restricted Stock Units (RSUs) [Member] | Market Measure-Based Restricted Stock Units (RSUs) [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Modified to time based | $53.05 | [1] | ||||||||||||
Expected Term | 6 years | |||||||||||||
Share-based Compensation, Historical volatility period | 12 years | |||||||||||||
Share-based Compensation, Grants in Period | 62,137 | 103,239 | 19,084 | 103,239 | ||||||||||
Share-based Compensation, Grant Date Fair Value | $0.50 | $0.40 | ||||||||||||
Share-based Compensation, Fair Value Assumptions, Exercise Price | $53.05 | |||||||||||||
Share-based Compensation, Number of Shares Available for Grant | 28,355 | 28,355 | 9,711 | |||||||||||
Document Period End Date | 30-Sep-13 | |||||||||||||
Share-based Compensation, Vesting, Number of Annual Installments | 7 years | |||||||||||||
Share-Based Compensation (Textuals) [Abstract] | ||||||||||||||
Allocated Share-based Compensation Expense | 2.5 | 2.4 | 7.2 | 6.2 | ||||||||||
Share-based Compensation Capitalized | 0.2 | 0.2 | 0.6 | 0.7 | ||||||||||
Share-based Compensation, Unrecognized costs | $27.90 | $27.90 | ||||||||||||
Share-based Compensation, Unrecognized costs, weighted-average vesting period | 2 years 4 months | |||||||||||||
[1] | During the second quarter the terms of time-based RSUs granted to certain officers of the Company in January were modified to include market-measure based vesting requirements. |
Commitments_and_Contingencies_
Commitments and Contingencies (Details 1) (USD $) | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 |
In Millions, unless otherwise specified | Maximum [Member] | Former Tenant Litigation Case [Member] | Property Damage Litigation Case [Member] | |
Long-term Purchase Commitment [Line Items] | ||||
Commitments for contracts and executed leases, operating and redevelopment and development properties | $447.70 | |||
Purchase Option, Maximum Price | 27.5 | |||
Proceeds from Legal Settlements | $3.70 | $5.20 |
Fair_Value_Measurements_and_Di2
Fair Value Measurements and Disclosures (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Fair value adjustment of marketable securities and deferred compensation plan liability | ||||
Net gain (loss) on marketable securities | $669 | $315 | $995 | $595 |
Fair_Value_Measurements_and_Di3
Fair Value Measurements and Disclosures (Details 1) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | ||
Liabilities | ||||
Secured Debt | $563,898,000 | [1] | $561,096,000 | [1] |
Exchangeable senior notes, net | 167,236,000 | 163,944,000 | ||
Unsecured debt | 1,431,048,000 | 1,130,895,000 | ||
Unsecured line of credit | 0 | 185,000,000 | ||
Carrying Value [Member] | ||||
Liabilities | ||||
Secured Debt | 563,898,000 | 561,096,000 | ||
Exchangeable senior notes, net | 167,236,000 | 163,944,000 | ||
Unsecured debt | 1,431,048,000 | 1,130,895,000 | ||
Unsecured line of credit | 0 | 185,000,000 | ||
Fair Value [Member] | ||||
Liabilities | ||||
Secured Debt | 574,661,000 | [2] | 591,993,000 | [2] |
Exchangeable senior notes, net | 178,379,000 | [2] | 181,223,000 | [2] |
Unsecured debt | 1,522,228,000 | [3] | 1,254,047,000 | [3] |
Unsecured line of credit | 0 | [2] | 185,049,000 | [2] |
Fair Value (Level 2) [Member] | Carrying Value [Member] | ||||
Liabilities | ||||
Unsecured debt | 589,200,000 | 557,600,000 | ||
Fair Value (Level 2) [Member] | Fair Value [Member] | ||||
Liabilities | ||||
Unsecured debt | 590,000,000 | 601,000,000 | ||
Unsecured Debt [Member] | Fair Value (Level 1) [Member] | Carrying Value [Member] | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Debt Instrument, Fair Value Disclosure | 841,900,000 | 573,300,000 | ||
Unsecured Debt [Member] | Fair Value (Level 1) [Member] | Fair Value [Member] | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Debt Instrument, Fair Value Disclosure | $932,200,000 | $653,000,000 | ||
[1] | Amounts reported include the amounts of unamortized debt premiums and discounts for the periods presented. | |||
[2] | Fair value calculated using Level II inputs which are based on model-derived valuations in which significant inputs and significant value drivers are observable in active markets. | |||
[3] | Fair value calculated using Level I and Level II inputs. Level I inputs are based on quoted prices for identical instruments in active markets. The carrying value and fair value of the Level I instruments was $841.9 million and $932.2 million, respectively, as of September 30, 2013. The carrying value and fair value of the Level I instruments at December 31, 2012, was $573.3 million and $653.0 million, respectively. The carrying value and fair value of the Level II instruments was $589.2 million and $590.0 million, respectively, as of September 30, 2013. The carrying value and fair value of the Level II instruments at December 31, 2012, was $557.6 million and $601.0 million, respectively. |
Discontinued_Operations_Detail
Discontinued Operations (Details) (USD $) | 3 Months Ended | 9 Months Ended | 9 Months Ended | 0 Months Ended | |||||||||||||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Oct. 02, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | ||||||
building | building | Agoura Road, 26541, Calabasas, CA [Member] | San Diego Properties, San Diego, CA [Member] | Kaiser Boulevard, Anaheim, California [Member] | Subsequent Event [Member] | Other Segments [Member] | Other Segments [Member] | Other Segments [Member] | |||||||||
sqft | sqft | sqft | sqft | sqft | Kaiser Boulevard, Anaheim, California [Member] | Properties Held for Sale [Member] | San Diego, California [Member] | Anaheim, California [Member] | |||||||||
building | building | Properties Held for Sale [Member] | Properties Held for Sale [Member] | ||||||||||||||
building | building | ||||||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||||||||||
Number of buildings | 14 | 14 | 1 | 14 | [1] | 13 | [2],[3] | 1 | [2],[4] | ||||||||
Rentable Square Feet | 1,159,185 | 1,159,185 | 90,156 | 1,099,395 | [3] | 59,790 | [4] | ||||||||||
Dispositions Sales Price | $14,700,000 | $9,600,000 | |||||||||||||||
Disposal Group, Including Discontinued Operation, Balance Sheet Disclosures [Abstract] | |||||||||||||||||
Land and improvements | 54,273,000 | 54,273,000 | |||||||||||||||
Buildings and improvements | 236,792,000 | 236,792,000 | |||||||||||||||
Undeveloped land and construction in progress | 1,441,000 | 1,441,000 | |||||||||||||||
Total real estate held for sale | 292,506,000 | 292,506,000 | |||||||||||||||
Accumulated depreciation | -70,084,000 | -70,084,000 | |||||||||||||||
Total real estate held for sale, net | 222,422,000 | 222,422,000 | |||||||||||||||
Current receivables, net | 303,000 | 303,000 | |||||||||||||||
Deferred rent receivables, net | 9,062,000 | 9,062,000 | |||||||||||||||
Deferred leasing costs and acquisition-related intangible assets, net | 6,643,000 | 6,643,000 | |||||||||||||||
Prepaid expenses and other assets, net | 981,000 | 981,000 | |||||||||||||||
Real estate and other assets held for sale, net | 239,411,000 | 239,411,000 | 0 | ||||||||||||||
Accounts payable and other liabilities | 2,554,000 | 2,554,000 | |||||||||||||||
Deferred revenue and acquisition-related intangible liabilities, net | 12,785,000 | 12,785,000 | |||||||||||||||
Rents received in advance and tenant security deposits | 1,412,000 | 1,412,000 | |||||||||||||||
Liabilities and deferred revenue of real estate assets held for sale | 16,751,000 | 16,751,000 | 0 | ||||||||||||||
Disposal Group, Including Discontinued Operation, Income Statement Disclosures [Abstract] | |||||||||||||||||
Rental income | 6,604,000 | 10,522,000 | 18,334,000 | 33,105,000 | |||||||||||||
Tenant reimbursements | 892,000 | 1,639,000 | 2,331,000 | 5,296,000 | |||||||||||||
Other property income | 4,610,000 | 229,000 | 4,617,000 | 884,000 | |||||||||||||
Total revenues | 12,106,000 | 12,390,000 | 25,282,000 | 39,285,000 | |||||||||||||
Property expenses | 2,020,000 | 2,044,000 | 3,920,000 | 6,287,000 | |||||||||||||
Real estate taxes | 684,000 | 1,301,000 | 2,048,000 | 3,719,000 | |||||||||||||
Provision for bad debts | -23,000 | -194,000 | -23,000 | -194,000 | |||||||||||||
Depreciation and amortization | 3,081,000 | 4,550,000 | 8,531,000 | 13,870,000 | |||||||||||||
Total expenses | 5,762,000 | 7,701,000 | 14,476,000 | 23,682,000 | |||||||||||||
Income from discontinued operations before net gain on dispositions of discontinued operations | 6,344,000 | 4,689,000 | 10,806,000 | 15,603,000 | |||||||||||||
Net gain on dispositions of discontinued operations | 0 | 0 | 423,000 | 72,809,000 | |||||||||||||
Total income from discontinued operations | $6,344,000 | $4,689,000 | $11,229,000 | $88,412,000 | |||||||||||||
[1] | Includes 13 properties located in San Diego, California and one property in Anaheim, California (see Note 12). | ||||||||||||||||
[2] | Estimated rentable square feet upon completion. | ||||||||||||||||
[3] | The San Diego Properties included the following: 4910 Directors Place, 10020 Pacific Mesa Boulevard, 6055 Lusk Avenue, 5010 and 5005 Wateridge Vista Drive, 15435 and 15445 Innovation Drive, and 15051, 15073, 15231, 15253, 15333 and 15378 Avenue of Science. | ||||||||||||||||
[4] | We closed on the disposition of this property on October 2, 2013. The sales price was $9.6 million. |
Net_Loss_Income_Available_to_C4
Net (Loss) Income Available to Common Stockholders Per Share of the Company (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||||||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | ||||
Numerator: | ||||||||
Income (loss) from continuing operations | $2,683 | ($2,167) | $10,289 | ($4,941) | ||||
Loss (income) from continuing operations attributable to noncontrolling common units of the Operating Partnership | 14 | 179 | -8 | 564 | ||||
Preferred distributions and dividends | -3,312 | -5,342 | -9,938 | -17,775 | ||||
Allocation to participating securities | -450 | [1] | -408 | [1] | -1,292 | [1] | -1,225 | [1] |
Numerator for basic and diluted loss from continuing operations available to common stockholders | -1,065 | -7,738 | -949 | -23,377 | ||||
Income from discontinued operations | 6,344 | 4,689 | 11,229 | 88,412 | ||||
Income from discontinued operations attributable to noncontrolling common units of the Operating Partnership | -145 | -112 | -258 | -2,272 | ||||
Numerator for basic and diluted net income (loss) available to common stockholders | 5,134 | -3,161 | 10,022 | 62,763 | ||||
Denominator: | ||||||||
Weighted average common shares outstanding - basic (Note 13) | 76,768,893 | 71,889,475 | 75,750,822 | 67,975,309 | ||||
Effect of dilutive securities - contingently issuable shares and stock options | 0 | 0 | 0 | 0 | ||||
Weighted average common shares outstanding-diluted | 76,768,893 | 71,889,475 | 75,750,822 | 67,975,309 | ||||
Basic earnings per share: | ||||||||
Loss from continuing operations available to common unitholders per common unit-basic (Note 14) | ($0.01) | ($0.10) | ($0.01) | ($0.34) | ||||
Income from discontinued operations per common share | $0.08 | $0.06 | $0.14 | $1.26 | ||||
Net (loss) income available to common stockholders per share-basic | $0.07 | ($0.04) | $0.13 | $0.92 | ||||
Diluted earnings per share: | ||||||||
Loss from continuing operations available to common unitholders per common unit-diluted (Note 14) | ($0.01) | ($0.10) | ($0.01) | ($0.34) | ||||
Income from discontinued operations per common share | $0.08 | $0.06 | $0.14 | $1.26 | ||||
Net (loss) income available to common stockholders per share-diluted | $0.07 | ($0.04) | $0.13 | $0.92 | ||||
Stock options outstanding | 1,525,000 | 1,540,000 | 1,525,000 | 1,540,000 | ||||
Kilroy Realty, L.P. [Member] | ||||||||
Numerator: | ||||||||
Income (loss) from continuing operations | 2,683 | -2,167 | 10,289 | -4,941 | ||||
Preferred distributions and dividends | -3,312 | -5,342 | -9,938 | -17,775 | ||||
Allocation to participating securities | 450 | [1] | 408 | [1] | 1,292 | [1] | 1,225 | [1] |
Numerator for basic and diluted loss from continuing operations available to common stockholders | -1,126 | -7,965 | -1,119 | -24,085 | ||||
Income from discontinued operations | 6,344 | 4,689 | 11,229 | 88,412 | ||||
Numerator for basic and diluted net income (loss) available to common stockholders | $5,218 | ($3,276) | $10,110 | $64,327 | ||||
Denominator: | ||||||||
Weighted average common shares outstanding - basic (Note 13) | 78,590,396 | 73,680,259 | 77,574,907 | 69,717,834 | ||||
Effect of dilutive securities - contingently issuable shares and stock options | 0 | 0 | 0 | 0 | ||||
Weighted average common shares outstanding-diluted | 78,590,396 | 73,680,259 | 77,574,907 | 69,717,834 | ||||
Basic earnings per share: | ||||||||
Loss from continuing operations available to common unitholders per common unit-basic (Note 14) | ($0.01) | ($0.10) | ($0.01) | ($0.34) | ||||
Income from discontinued operations per common share | $0.08 | $0.06 | $0.14 | $1.26 | ||||
Net (loss) income available to common stockholders per share-basic | $0.07 | ($0.04) | $0.13 | $0.92 | ||||
Diluted earnings per share: | ||||||||
Loss from continuing operations available to common unitholders per common unit-diluted (Note 14) | ($0.01) | ($0.10) | ($0.01) | ($0.34) | ||||
Income from discontinued operations per common share | $0.08 | $0.06 | $0.14 | $1.26 | ||||
Net (loss) income available to common stockholders per share-diluted | $0.07 | ($0.04) | $0.13 | $0.92 | ||||
[1] | Participating securities include nonvested shares, time-based RSUs and vested market-measure RSUs. |
Net_Income_Available_to_Common
Net Income Available to Common Unitholders Per Unit of the Operating Partnership (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||||||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | ||||
Numerator: | ||||||||
Income (loss) from continuing operations | $2,683 | ($2,167) | $10,289 | ($4,941) | ||||
Total preferred distributions | -3,312 | -5,342 | -9,938 | -17,775 | ||||
Allocation to participating securities | -450 | [1] | -408 | [1] | -1,292 | [1] | -1,225 | [1] |
Numerator for basic and diluted loss from continuing operations available to common unitholders | -1,065 | -7,738 | -949 | -23,377 | ||||
Income from discontinued operations | 6,344 | 4,689 | 11,229 | 88,412 | ||||
Numerator for basic and diluted net income (loss) available to common unitholders | 5,134 | -3,161 | 10,022 | 62,763 | ||||
Denominator: | ||||||||
Weighted average common units outstanding - basic (Note 14) | 76,768,893 | 71,889,475 | 75,750,822 | 67,975,309 | ||||
Effect of dilutive securities - contingently issuable shares and stock options | 0 | 0 | 0 | 0 | ||||
Weighted average common units outstanding - diluted (Note 14) | 76,768,893 | 71,889,475 | 75,750,822 | 67,975,309 | ||||
Basic earnings per unit: | ||||||||
Loss from continuing operations available to common unitholders per common unit-basic (Note 14) | ($0.01) | ($0.10) | ($0.01) | ($0.34) | ||||
Income from discontinued operations per common unit | $0.08 | $0.06 | $0.14 | $1.26 | ||||
Net income (loss) available to common unitholders per unit-basic (Note 14) | $0.07 | ($0.04) | $0.13 | $0.92 | ||||
Diluted earnings per unit: | ||||||||
Loss from continuing operations available to common unitholders per common unit-diluted (Note 14) | ($0.01) | ($0.10) | ($0.01) | ($0.34) | ||||
Income from discontinued operations per common unit | $0.08 | $0.06 | $0.14 | $1.26 | ||||
Net income (loss) available to common unitholders per unit-diluted (Note 14) | $0.07 | ($0.04) | $0.13 | $0.92 | ||||
Stock options outstanding | 1,525,000 | 1,540,000 | 1,525,000 | 1,540,000 | ||||
Kilroy Realty, L.P. [Member] | ||||||||
Numerator: | ||||||||
Income (loss) from continuing operations | 2,683 | -2,167 | 10,289 | -4,941 | ||||
Income from continuing operations attributable to noncontrolling interests in consolidated subsidiaries | -47 | -48 | -178 | -144 | ||||
Total preferred distributions | -3,312 | -5,342 | -9,938 | -17,775 | ||||
Allocation to participating securities | 450 | [1] | 408 | [1] | 1,292 | [1] | 1,225 | [1] |
Numerator for basic and diluted loss from continuing operations available to common unitholders | -1,126 | -7,965 | -1,119 | -24,085 | ||||
Income from discontinued operations | 6,344 | 4,689 | 11,229 | 88,412 | ||||
Numerator for basic and diluted net income (loss) available to common unitholders | $5,218 | ($3,276) | $10,110 | $64,327 | ||||
Denominator: | ||||||||
Weighted average common units outstanding - basic (Note 14) | 78,590,396 | 73,680,259 | 77,574,907 | 69,717,834 | ||||
Effect of dilutive securities - contingently issuable shares and stock options | 0 | 0 | 0 | 0 | ||||
Weighted average common units outstanding - diluted (Note 14) | 78,590,396 | 73,680,259 | 77,574,907 | 69,717,834 | ||||
Basic earnings per unit: | ||||||||
Loss from continuing operations available to common unitholders per common unit-basic (Note 14) | ($0.01) | ($0.10) | ($0.01) | ($0.34) | ||||
Income from discontinued operations per common unit | $0.08 | $0.06 | $0.14 | $1.26 | ||||
Net income (loss) available to common unitholders per unit-basic (Note 14) | $0.07 | ($0.04) | $0.13 | $0.92 | ||||
Diluted earnings per unit: | ||||||||
Loss from continuing operations available to common unitholders per common unit-diluted (Note 14) | ($0.01) | ($0.10) | ($0.01) | ($0.34) | ||||
Income from discontinued operations per common unit | $0.08 | $0.06 | $0.14 | $1.26 | ||||
Net income (loss) available to common unitholders per unit-diluted (Note 14) | $0.07 | ($0.04) | $0.13 | $0.92 | ||||
Market Measure-Based Restricted Stock Units (RSUs) [Member] | Kilroy Realty, L.P. [Member] | ||||||||
Diluted earnings per unit: | ||||||||
Incremental Common Shares Attributable to Dilutive Effect of Share-based Payment Arrangements, Restricted Stock Units | 159,360 | 103,238 | 159,360 | 103,238 | ||||
[1] | Participating securities include nonvested shares, time-based RSUs and vested market-measure RSUs. |
Subsequent_Events_Details
Subsequent Events (Details) (USD $) | 9 Months Ended | 0 Months Ended | 1 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | Oct. 17, 2013 | Oct. 29, 2013 | |
Subsequent Event [Member] | Subsequent Event [Member] | |||
acre | ||||
Subsequent Event [Line Items] | ||||
Aggregate dividends, distributions, and dividend equivalents paid to common stockholders and common unitholders | $82,152,000 | $70,517,000 | $29,800,000 | |
Area of land | 2 | |||
Payments to acquire land | $17,000,000 |