Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2016 | Jul. 22, 2016 | |
Entity Registrant Name | KILROY REALTY CORP | |
Entity Central Index Key | 1,025,996 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 92,256,063 | |
Kilroy Realty, L.P. [Member] | ||
Entity Registrant Name | Kilroy Realty, L.P. | |
Entity Central Index Key | 1,493,976 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 | |
REAL ESTATE ASSETS (Note 2): | |||
Land and improvements | $ 1,020,287 | $ 875,794 | |
Buildings and improvements | 4,639,003 | 4,091,012 | |
Undeveloped land and construction in progress | 894,057 | 1,361,340 | |
Total real estate assets held for investment | 6,553,347 | 6,328,146 | |
Accumulated depreciation and amortization | (1,054,828) | (994,241) | |
Total real estate assets held for investment, net | 5,498,519 | 5,333,905 | |
REAL ESTATE ASSETS AND OTHER ASSETS HELD FOR SALE, NET (Note 3) | 30,257 | 117,666 | |
CASH AND CASH EQUIVALENTS | 26,332 | 56,508 | |
RESTRICTED CASH (Notes 1 and 3) | 266,158 | 696 | |
MARKETABLE SECURITIES (Note 12) | 13,388 | 12,882 | |
CURRENT RECEIVABLES, NET (Note 5) | 10,112 | 11,153 | |
DEFERRED RENT RECEIVABLES, NET (Note 5) | [1] | 207,851 | 189,704 |
DEFERRED LEASING COSTS AND ACQUISITION-RELATED INTANGIBLE ASSETS, NET (Note 4) | 186,903 | 176,683 | |
PREPAID EXPENSES AND OTHER ASSETS, NET (Note 1) | 58,913 | 27,233 | |
TOTAL ASSETS | 6,298,433 | 5,926,430 | |
LIABILITIES: | |||
Secured debt, net (Notes 1, 6 and 12) | 373,500 | 380,835 | |
Unsecured debt, net (Notes 1, 6 and 12) | 1,845,992 | 1,844,634 | |
Unsecured line of credit (Notes 6 and 12) | 220,000 | 0 | |
Accounts payable, accrued expenses and other liabilities | 211,196 | 246,323 | |
Accrued dividends and distributions (Note 17) | 37,733 | 34,992 | |
Deferred revenue and acquisition-related intangible liabilities, net (Note 4) | 138,394 | 128,156 | |
Rents received in advance and tenant security deposits | 44,663 | 49,361 | |
Liabilities of real estate assets held for sale (Note 3) | 321 | 7,543 | |
Total liabilities | 2,871,799 | 2,691,844 | |
COMMITMENTS AND CONTINGENCIES (Note 11) | |||
Preferred stock, $.01 par value, 30,000,000 shares authorized: | |||
Common stock, $.01 par value, 150,000,000 shares authorized, 92,254,768 and 92,258,690 shares issued and outstanding, respectively | 923 | 923 | |
Additional paid-in capital | 3,074,508 | 3,047,894 | |
Retained earnings/(distributions in excess of earnings) | 62,647 | (70,262) | |
Total stockholders’ equity | 3,330,489 | 3,170,966 | |
Noncontrolling Interests: | |||
Common units of the Operating Partnership (Note 7) | 89,495 | 57,100 | |
Noncontrolling interest in consolidated subsidiary (Note 1) | 6,650 | 6,520 | |
Total noncontrolling interests | 96,145 | 63,620 | |
Total equity | 3,426,634 | 3,234,586 | |
TOTAL LIABILITIES AND EQUITY | 6,298,433 | 5,926,430 | |
6.875% Series G Cumulative Redeemable Preferred stock, $.01 par value, 4,600,000 shares authorized, 4,000,000 shares issued and outstanding ($100,000 liquidation preference) [Member] | |||
Preferred stock, $.01 par value, 30,000,000 shares authorized: | |||
Cumulative Redeemable Preferred stock | 96,155 | 96,155 | |
6.375% Series H Cumulative Redeemable Preferred stock, $.01 par value, 4,000,000 shares authorized, issued and outstanding ($100,000 liquidation preference) [Member] | |||
Preferred stock, $.01 par value, 30,000,000 shares authorized: | |||
Cumulative Redeemable Preferred stock | $ 96,256 | $ 96,256 | |
[1] | Excludes deferred rent receivables related to real estate held for sale. |
Consolidated Balance Sheets (U3
Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2016 | Dec. 31, 2015 | |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 92,254,768 | 92,258,690 |
Common stock, shares outstanding | 92,254,768 | 92,258,690 |
Preferred Stock [Member] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 30,000,000 | 30,000,000 |
Series G Cumulative Redeemable Preferred Stock [Member] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock dividend rate percentage | 6.875% | 6.875% |
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 [Member] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock dividend rate percentage | 6.375% | 6.375% |
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 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
REVENUES: | ||||
Rental income | $ 143,653 | $ 131,450 | $ 277,408 | $ 262,382 |
Tenant reimbursements | 16,138 | 14,174 | 27,542 | 28,599 |
Other property income | 342 | 603 | 629 | 1,328 |
Total revenues | 160,133 | 146,227 | 305,579 | 292,309 |
EXPENSES | ||||
Property expenses | 29,221 | 26,866 | 55,186 | 51,580 |
Real estate taxes | 13,845 | 12,430 | 24,877 | 25,145 |
Provision for bad debts | 0 | 47 | 0 | 289 |
Ground leases | 768 | 813 | 1,597 | 1,589 |
General and administrative expenses | 13,979 | 12,633 | 27,416 | 25,401 |
Acquisition-related expenses | 714 | 265 | 776 | 393 |
Depreciation and amortization | 53,346 | 51,658 | 103,786 | 103,145 |
Total expenses | 111,873 | 104,712 | 213,638 | 207,542 |
OTHER (EXPENSES) INCOME: | ||||
Interest income and other net investment gains (Note 12) | 311 | 511 | 582 | 871 |
Interest expense (Note 6) | (14,384) | (14,864) | (26,213) | (31,742) |
Total other (expenses) income | (14,073) | (14,353) | (25,631) | (30,871) |
INCOME FROM OPERATIONS BEFORE GAINS (LOSSES) ON SALES OF REAL ESTATE | 34,187 | 27,162 | 66,310 | 53,896 |
Net (loss) gain on sales of land (Note 3) | (295) | 0 | (295) | 17,268 |
Gains on sales of depreciable operating properties (Note 3) | 0 | 31,428 | 145,990 | 31,428 |
NET INCOME | 33,892 | 58,590 | 212,005 | 102,592 |
Net income attributable to noncontrolling common units of the Operating Partnership | (829) | (1,090) | (4,439) | (1,905) |
Net income attributable to noncontrolling interest in consolidated subsidiary | (216) | 0 | (411) | 0 |
Total income attributable to noncontrolling interests | (1,045) | (1,090) | (4,850) | (1,905) |
NET INCOME ATTRIBUTABLE TO KILROY REALTY CORPORATION | 32,847 | 57,500 | 207,155 | 100,687 |
PREFERRED DIVIDENDS | (3,312) | (3,312) | (6,625) | (6,625) |
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS | $ 29,535 | $ 54,188 | $ 200,530 | $ 94,062 |
Net income available to common stockholders per share – basic (Note 13) (in dollars per share) | $ 0.32 | $ 0.61 | $ 2.17 | $ 1.07 |
Net income available to common stockholders per share – diluted (Note 13) (in dollars per share) | $ 0.31 | $ 0.61 | $ 2.15 | $ 1.06 |
Weighted average common shares outstanding – basic (Note 13) (in shares) | 92,209,955 | 88,126,187 | 92,217,238 | 87,514,878 |
Weighted average common shares outstanding – diluted (Note 13) (in shares) | 92,824,786 | 88,645,868 | 92,784,065 | 88,044,292 |
Dividends declared per common share (in dollars per share) | $ 0.375 | $ 0.35 | $ 0.725 | $ 0.7 |
Consolidated Statements of Equi
Consolidated Statements of Equity (Unaudited) - USD ($) $ in Thousands | Total | Preferred Stock [Member] | Common Stock [Member] | Common Stock Additional Paid-in Capital [Member] | Common Stock Distributions in Excess of Earnings [Member] | Total Stockholders' Equity [Member] | Noncontrolling Interest [Member] |
Beginning Balance at Dec. 31, 2014 | $ 2,723,936 | $ 192,411 | $ 863 | $ 2,635,900 | $ (162,964) | $ 2,666,210 | $ 57,726 |
Beginning Balance, shares at Dec. 31, 2014 | 86,259,684 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | 102,592 | 100,687 | 100,687 | 1,905 | |||
Issuance of common stock, shares | 1,866,267 | ||||||
Issuance of common stock | 137,924 | $ 18 | 137,906 | 137,924 | |||
Issuance of share-based compensation awards | 844 | 844 | 844 | ||||
Noncash amortization of share-based compensation | 9,251 | 9,251 | 9,251 | ||||
Exercise of stock options, shares | 252,000 | ||||||
Exercise of stock options | 10,738 | $ 3 | 10,735 | 10,738 | |||
Repurchase of common stock, stock options and restricted stock units, shares | (20,752) | ||||||
Repurchase of common stock, stock options and restricted stock units | (1,836) | (1,836) | (1,836) | ||||
Settlement of restricted stock units for shares of common stock, shares | 37,403 | ||||||
Settlement of restricted stock units for shares of common stock | 0 | 0 | 0 | ||||
Exchange of common units of the Operating Parternship, shares | 11,030 | ||||||
Exchange of common units of the Operating Partnership | 0 | 316 | 316 | (316) | |||
Adjustment for noncontrolling interest | 0 | (1,890) | (1,890) | 1,890 | |||
Contribution by noncontrolling interest in consolidated subsidiary | 203 | 203 | |||||
Preferred dividends | (6,625) | (6,625) | (6,625) | ||||
Dividends declared per common share and common unit ($0.725 and $0.70 per share/unit for the six months ended 2016 and 2015, respectively) | (63,922) | (62,667) | (62,667) | (1,255) | |||
Ending Balance, shares at Jun. 30, 2015 | 88,405,632 | ||||||
Ending Balance at Jun. 30, 2015 | 2,913,105 | 192,411 | $ 884 | 2,791,226 | (131,569) | 2,852,952 | 60,153 |
Beginning Balance at Dec. 31, 2015 | $ 3,234,586 | 192,411 | $ 923 | 3,047,894 | (70,262) | 3,170,966 | 63,620 |
Beginning Balance, shares at Dec. 31, 2015 | 92,258,690 | 92,258,690 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | $ 212,005 | 207,155 | 207,155 | 4,850 | |||
Issuance of share-based compensation awards | 853 | 853 | 853 | ||||
Noncash amortization of share-based compensation | 12,538 | 12,538 | 12,538 | ||||
Exercise of stock options, shares | 22,000 | ||||||
Exercise of stock options | 937 | 937 | 937 | ||||
Repurchase of common stock, stock options and restricted stock units, shares | (96,360) | ||||||
Repurchase of common stock, stock options and restricted stock units | (5,883) | $ (1) | (5,882) | (5,883) | |||
Settlement of restricted stock units for shares of common stock, shares | 69,238 | ||||||
Settlement of restricted stock units for shares of common stock | 0 | $ 1 | (1) | 0 | |||
Issuance of common units in connection with acquisition (Note 2) | 48,033 | 48,033 | |||||
Exchange of common units of the Operating Parternship, shares | 1,200 | ||||||
Exchange of common units of the Operating Partnership | 0 | 39 | 39 | (39) | |||
Adjustment for noncontrolling interest | 0 | 18,130 | 18,130 | (18,130) | |||
Contribution by noncontrolling interest in consolidated subsidiary | (281) | (281) | |||||
Preferred dividends | (6,625) | (6,625) | (6,625) | ||||
Dividends declared per common share and common unit ($0.725 and $0.70 per share/unit for the six months ended 2016 and 2015, respectively) | $ (69,529) | (67,621) | (67,621) | (1,908) | |||
Ending Balance, shares at Jun. 30, 2016 | 92,254,768 | 92,254,768 | |||||
Ending Balance at Jun. 30, 2016 | $ 3,426,634 | $ 192,411 | $ 923 | $ 3,074,508 | $ 62,647 | $ 3,330,489 | $ 96,145 |
Consolidated Statements of Equ6
Consolidated Statements of Equity (Unaudited) (Parenthetical) - $ / shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Statement of Stockholders' Equity [Abstract] | ||||
Dividends declared per common share and common unit (in dollars per share) | $ 0.375 | $ 0.35 | $ 0.725 | $ 0.7 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 212,005 | $ 102,592 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization of building and improvements and leasing costs | 102,127 | 101,812 |
Depreciation of furniture, fixtures and equipment | 1,659 | 1,333 |
Increase in provision for bad debts | 0 | 289 |
Noncash amortization of share-based compensation awards | 10,034 | 7,650 |
Noncash amortization of deferred financing costs and debt discounts and premiums | 1,306 | 889 |
Noncash amortization of net below market rents (Note 4) | (3,243) | (5,029) |
Gains on sales of depreciable operating properties (Note 3) | (145,990) | (31,428) |
Loss (gain) on sales of land (Note 3) | 295 | (17,268) |
Noncash amortization of deferred revenue related to tenant-funded tenant improvements | (6,100) | (6,304) |
Straight-line rents | (18,537) | (28,575) |
Net change in other operating assets | (6,071) | (9,100) |
Net change in other operating liabilities | (9,856) | (33) |
Net cash provided by operating activities | 137,629 | 116,828 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Expenditures for development properties and undeveloped land | (162,122) | (199,358) |
Expenditures for acquisition of undeveloped land (Note 2) | (33,513) | (52,134) |
Expenditures for acquisition of operating properties (Note 2) | (55,415) | 0 |
Expenditures for operating properties and other capital assets | (65,543) | (50,969) |
Net proceeds received from dispositions (Note 3) | 276,622 | 165,797 |
(Increase) decrease in restricted cash (Note 3) | (265,462) | 58,444 |
Decrease (increase) in acquisition-related deposits | 1,902 | (6,800) |
Increase in note receivable | (1,000) | 0 |
Net cash used in investing activities | (304,531) | (85,020) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Net proceeds from issuance of common stock | 0 | 137,924 |
Borrowings on unsecured revolving credit facility | 270,000 | 250,000 |
Repayments on unsecured revolving credit facility | (50,000) | (290,000) |
Principal payments on secured debt (Note 6) | (4,808) | (64,771) |
Financing costs | (679) | (769) |
Repurchase of common stock and restricted stock units | (5,883) | (1,836) |
Proceeds from exercise of stock options | 937 | 10,738 |
Distributions to noncontrolling interests in consolidated subsidiary | (281) | 0 |
Distributions to noncontrolling interests in consolidated subsidiary | 0 | 203 |
Dividends and distributions paid to common stockholders and common unitholders | (65,935) | (62,311) |
Dividends and distributions paid to preferred stockholders and preferred unitholders | (6,625) | (6,625) |
Net cash provided by (used in) financing activities | 136,726 | (27,447) |
Net (decrease) increase in cash and cash equivalents | (30,176) | 4,361 |
Cash and cash equivalents, beginning of period | 56,508 | 23,781 |
Cash and cash equivalents, end of period | $ 26,332 | $ 28,142 |
Consolidated Balance Sheets (KI
Consolidated Balance Sheets (KILROY REALTY, L.P.) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 | |
REAL ESTATE ASSETS (Note 2): | |||
Land and improvements | $ 1,020,287 | $ 875,794 | |
Buildings and improvements | 4,639,003 | 4,091,012 | |
Undeveloped land and construction in progress | 894,057 | 1,361,340 | |
Total real estate assets held for investment | 6,553,347 | 6,328,146 | |
Accumulated depreciation and amortization | (1,054,828) | (994,241) | |
Total real estate assets held for investment, net | 5,498,519 | 5,333,905 | |
REAL ESTATE ASSETS AND OTHER ASSETS HELD FOR SALE, NET (Note 3) | 30,257 | 117,666 | |
CASH AND CASH EQUIVALENTS | 26,332 | 56,508 | |
RESTRICTED CASH (Notes 1 and 3) | 266,158 | 696 | |
MARKETABLE SECURITIES (Note 12) | 13,388 | 12,882 | |
CURRENT RECEIVABLES, NET (Note 5) | 10,112 | 11,153 | |
DEFERRED RENT RECEIVABLES, NET (Note 5) | [1] | 207,851 | 189,704 |
DEFERRED LEASING COSTS AND ACQUISITION-RELATED INTANGIBLE ASSETS, NET (Note 4) | 186,903 | 176,683 | |
PREPAID EXPENSES AND OTHER ASSETS, NET (Note 1) | 58,913 | 27,233 | |
TOTAL ASSETS | 6,298,433 | 5,926,430 | |
LIABILITIES: | |||
Secured debt, net (Notes 1, 6 and 12) | 373,500 | 380,835 | |
Unsecured debt, net (Notes 1, 6 and 12) | 1,845,992 | 1,844,634 | |
Unsecured line of credit (Notes 6 and 12) | 220,000 | 0 | |
Accounts payable, accrued expenses and other liabilities | 211,196 | 246,323 | |
Accrued dividends and distributions (Note 17) | 37,733 | 34,992 | |
Deferred revenue and acquisition-related intangible liabilities, net (Note 4) | 138,394 | 128,156 | |
Rents received in advance and tenant security deposits | 44,663 | 49,361 | |
Liabilities of real estate assets held for sale (Note 3) | 321 | 7,543 | |
Total liabilities | 2,871,799 | 2,691,844 | |
COMMITMENTS AND CONTINGENCIES (Note 11) | |||
Partners’ Capital (Note 9): | |||
TOTAL LIABILITIES AND EQUITY | 6,298,433 | 5,926,430 | |
Kilroy Realty, L.P. [Member] | |||
REAL ESTATE ASSETS (Note 2): | |||
Land and improvements | 1,020,287 | 875,794 | |
Buildings and improvements | 4,639,003 | 4,091,012 | |
Undeveloped land and construction in progress | 894,057 | 1,361,340 | |
Total real estate assets held for investment | 6,553,347 | 6,328,146 | |
Accumulated depreciation and amortization | (1,054,828) | (994,241) | |
Total real estate assets held for investment, net | 5,498,519 | 5,333,905 | |
REAL ESTATE ASSETS AND OTHER ASSETS HELD FOR SALE, NET (Note 3) | 30,257 | 117,666 | |
CASH AND CASH EQUIVALENTS | 26,332 | 56,508 | |
RESTRICTED CASH (Notes 1 and 3) | 266,158 | 696 | |
MARKETABLE SECURITIES (Note 12) | 13,388 | 12,882 | |
CURRENT RECEIVABLES, NET (Note 5) | 10,112 | 11,153 | |
DEFERRED RENT RECEIVABLES, NET (Note 5) | 207,851 | 189,704 | |
DEFERRED LEASING COSTS AND ACQUISITION-RELATED INTANGIBLE ASSETS, NET (Note 4) | 186,903 | 176,683 | |
PREPAID EXPENSES AND OTHER ASSETS, NET (Note 1) | 58,913 | 27,233 | |
TOTAL ASSETS | 6,298,433 | 5,926,430 | |
LIABILITIES: | |||
Secured debt, net (Notes 1, 6 and 12) | 373,500 | 380,835 | |
Unsecured debt, net (Notes 1, 6 and 12) | 1,845,992 | 1,844,634 | |
Unsecured line of credit (Notes 6 and 12) | 220,000 | 0 | |
Accounts payable, accrued expenses and other liabilities | 211,196 | 246,323 | |
Accrued dividends and distributions (Note 17) | 37,733 | 34,992 | |
Deferred revenue and acquisition-related intangible liabilities, net (Note 4) | 138,394 | 128,156 | |
Rents received in advance and tenant security deposits | 44,663 | 49,361 | |
Liabilities of real estate assets held for sale (Note 3) | 321 | 7,543 | |
Total liabilities | 2,871,799 | 2,691,844 | |
COMMITMENTS AND CONTINGENCIES (Note 11) | |||
Partners’ Capital (Note 9): | |||
Common units, 92,254,768 and 92,258,690 held by the general partner and 2,631,276 and 1,764,775 held by common limited partners issued and outstanding, respectively | 3,223,356 | 3,031,609 | |
Total partners’ capital | 3,415,767 | 3,224,020 | |
Noncontrolling interests in consolidated subsidiaries (Note 1) | 10,867 | 10,566 | |
Total capital | 3,426,634 | 3,234,586 | |
TOTAL LIABILITIES AND EQUITY | 6,298,433 | 5,926,430 | |
Kilroy Realty, L.P. [Member] | Series G Cumulative Redeemable Preferred Units [Member] | |||
Partners’ Capital (Note 9): | |||
Cumulative Redeemable Preferred units | 96,155 | 96,155 | |
Kilroy Realty, L.P. [Member] | Series H Cumulative Redeemable Preferred Units [Member] | |||
Partners’ Capital (Note 9): | |||
Cumulative Redeemable Preferred units | $ 96,256 | $ 96,256 | |
[1] | Excludes deferred rent receivables related to real estate held for sale. |
Consolidated Balance Sheets (K9
Consolidated Balance Sheets (KILROY REALTY, L.P.) (Parenthetical) - Kilroy Realty, L.P. [Member] - USD ($) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2016 | Dec. 31, 2015 | |
Series G Cumulative Redeemable Preferred Units [Member] | ||
Preferred Units, Issued | 4,000,000 | 4,000,000 |
Preferred Units, Outstanding | 4,000,000 | 4,000,000 |
Preferred stock dividend rate percentage | 6.875% | 6.875% |
Preferred Stock Liquidation preference | $ 100,000,000 | $ 100,000,000 |
Series H Cumulative Redeemable Preferred Units [Member] | ||
Preferred Units, Issued | 4,000,000 | 4,000,000 |
Preferred Units, Outstanding | 4,000,000 | 4,000,000 |
Preferred stock dividend rate percentage | 6.375% | 6.375% |
Preferred Stock Liquidation preference | $ 100,000,000 | $ 100,000,000 |
Common Units [Member] | ||
General partner, units issued | 92,254,768 | 92,258,690 |
General partners, units outstanding | 92,254,768 | 92,258,690 |
Limited partners, units issued | 2,631,276 | 1,764,775 |
Noncontrolling common units of the Operating Partnership | 2,631,276 | 1,764,775 |
Consolidated Statements of Op10
Consolidated Statements of Operations (KILROY REALTY, L.P.) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
REVENUES: | ||||
Rental income | $ 143,653 | $ 131,450 | $ 277,408 | $ 262,382 |
Tenant reimbursements | 16,138 | 14,174 | 27,542 | 28,599 |
Other property income | 342 | 603 | 629 | 1,328 |
Total revenues | 160,133 | 146,227 | 305,579 | 292,309 |
EXPENSES | ||||
Property expenses | 29,221 | 26,866 | 55,186 | 51,580 |
Real estate taxes | 13,845 | 12,430 | 24,877 | 25,145 |
Provision for bad debts | 0 | 47 | 0 | 289 |
Ground leases | 768 | 813 | 1,597 | 1,589 |
General and administrative expenses | 13,979 | 12,633 | 27,416 | 25,401 |
Acquisition-related expenses | 714 | 265 | 776 | 393 |
Depreciation and amortization | 53,346 | 51,658 | 103,786 | 103,145 |
Total expenses | 111,873 | 104,712 | 213,638 | 207,542 |
OTHER (EXPENSES) INCOME: | ||||
Interest income and other net investment gains (Note 12) | 311 | 511 | 582 | 871 |
Interest expense (Note 6) | (14,384) | (14,864) | (26,213) | (31,742) |
Total other (expenses) income | (14,073) | (14,353) | (25,631) | (30,871) |
Net (loss) gain on sales of land (Note 3) | (295) | 0 | (295) | 17,268 |
Gains on sales of depreciable operating properties (Note 3) | 0 | 31,428 | 145,990 | 31,428 |
NET INCOME | 33,892 | 58,590 | 212,005 | 102,592 |
Net income attributable to noncontrolling interests in consolidated subsidiaries | (1,045) | (1,090) | (4,850) | (1,905) |
NET INCOME ATTRIBUTABLE TO KILROY REALTY CORPORATION | 32,847 | 57,500 | 207,155 | 100,687 |
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS | $ 29,535 | $ 54,188 | $ 200,530 | $ 94,062 |
Net income available to common unitholders per unit-basic (Note 14) (in dollars per unit) | $ 0.32 | $ 0.61 | $ 2.17 | $ 1.07 |
Net income available to common unitholders per unit-diluted (Note 14) (in dollars per unit) | $ 0.31 | $ 0.61 | $ 2.15 | $ 1.06 |
Weighted average common units outstanding - basic (Note 14) (in units) | 92,209,955 | 88,126,187 | 92,217,238 | 87,514,878 |
Weighted average common units outstanding - diluted (Note 14) (in units) | 92,824,786 | 88,645,868 | 92,784,065 | 88,044,292 |
Kilroy Realty, L.P. [Member] | ||||
REVENUES: | ||||
Rental income | $ 143,653 | $ 131,450 | $ 277,408 | $ 262,382 |
Tenant reimbursements | 16,138 | 14,174 | 27,542 | 28,599 |
Other property income | 342 | 603 | 629 | 1,328 |
Total revenues | 160,133 | 146,227 | 305,579 | 292,309 |
EXPENSES | ||||
Property expenses | 29,221 | 26,866 | 55,186 | 51,580 |
Real estate taxes | 13,845 | 12,430 | 24,877 | 25,145 |
Provision for bad debts | 0 | 47 | 0 | 289 |
Ground leases | 768 | 813 | 1,597 | 1,589 |
General and administrative expenses | 13,979 | 12,633 | 27,416 | 25,401 |
Acquisition-related expenses | 714 | 265 | 776 | 393 |
Depreciation and amortization | 53,346 | 51,658 | 103,786 | 103,145 |
Total expenses | 111,873 | 104,712 | 213,638 | 207,542 |
OTHER (EXPENSES) INCOME: | ||||
Interest income and other net investment gains (Note 12) | 311 | 511 | 582 | 871 |
Interest expense (Note 6) | (14,384) | (14,864) | (26,213) | (31,742) |
Total other (expenses) income | (14,073) | (14,353) | (25,631) | (30,871) |
INCOME FROM OPERATIONS BEFORE GAINS (LOSSES) ON SALES OF REAL ESTATE | 34,187 | 27,162 | 66,310 | 53,896 |
Net (loss) gain on sales of land (Note 3) | (295) | 0 | (295) | 17,268 |
Gains on sales of depreciable operating properties (Note 3) | 0 | 31,428 | 145,990 | 31,428 |
NET INCOME | 33,892 | 58,590 | 212,005 | 102,592 |
Net income attributable to noncontrolling interests in consolidated subsidiaries | (302) | (72) | (582) | (147) |
NET INCOME ATTRIBUTABLE TO KILROY REALTY CORPORATION | 33,590 | 58,518 | 211,423 | 102,445 |
Preferred Distributions | (3,312) | (3,312) | (6,625) | (6,625) |
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS | $ 30,278 | $ 55,206 | $ 204,798 | $ 95,820 |
Net income available to common unitholders per unit-basic (Note 14) (in dollars per unit) | $ 0.31 | $ 0.61 | $ 2.16 | $ 1.06 |
Net income available to common unitholders per unit-diluted (Note 14) (in dollars per unit) | $ 0.31 | $ 0.61 | $ 2.15 | $ 1.06 |
Weighted average common units outstanding - basic (Note 14) (in units) | 94,841,231 | 89,919,357 | 94,514,876 | 89,309,718 |
Weighted average common units outstanding - diluted (Note 14) (in units) | 95,456,062 | 90,439,038 | 95,081,703 | 89,839,132 |
Dividends declared per common unit (in dollars per unit) | $ 0.375 | $ 0.35 | $ 0.725 | $ 0.7 |
Consolidated Statements of Capi
Consolidated Statements of Capital (KILROY REALTY, L.P.) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income | $ 33,892 | $ 58,590 | $ 212,005 | $ 102,592 |
Noncash amortization of share-based compensation | 12,538 | 9,251 | ||
Contribution by noncontrolling interest in consolidated subsidiary | 203 | |||
Settlement of restricted stock units | 0 | 0 | ||
Contribution by noncontrolling interest in consolidated subsidiary | (281) | |||
Preferred distributions | (6,625) | (6,625) | ||
Noncontrolling Interest [Member] | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income | 4,850 | 1,905 | ||
Contribution by noncontrolling interest in consolidated subsidiary | 203 | |||
Contribution by noncontrolling interest in consolidated subsidiary | (281) | |||
Kilroy Realty, L.P. [Member] | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning Balance | 3,234,586 | 2,723,936 | ||
Net income | 33,892 | 58,590 | 212,005 | 102,592 |
Issuance of common units | 137,924 | |||
Issuance of common units in connection with acquisition (Note 2) | 48,033 | |||
Issuance of share-based compensation awards | 853 | 844 | ||
Noncash amortization of share-based compensation | 12,538 | 9,251 | ||
Exercise of stock options | 937 | 10,738 | ||
Contribution by noncontrolling interest in consolidated subsidiary | 203 | |||
Repurchase of common units, stock options and restricted stock units | (5,883) | (1,836) | ||
Settlement of restricted stock units | 0 | 0 | ||
Contribution by noncontrolling interest in consolidated subsidiary | (281) | |||
Preferred distributions | (6,625) | (6,625) | ||
Distributions declared per common unit ($0.725 and $0.70 per unit for the six months ended 2016 and 2015, respectively) | (69,529) | (63,922) | ||
Ending Balance | 3,426,634 | 2,913,105 | 3,426,634 | 2,913,105 |
Kilroy Realty, L.P. [Member] | Partners Capital Preferred Units [Member] | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning Balance | 192,411 | 192,411 | ||
Ending Balance | 192,411 | 192,411 | 192,411 | 192,411 |
Kilroy Realty, L.P. [Member] | Partners Capital Common Unit [Member] | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning Balance | $ 3,031,609 | $ 2,521,900 | ||
Beginning Balance units | 94,023,465 | 88,063,884 | ||
Net income | $ 211,423 | $ 102,445 | ||
Issuance of common units, units | 1,866,267 | |||
Issuance of common units | $ 137,924 | |||
Issuance of common units in connection with acquisition (Note 2), units | 867,701 | |||
Issuance of common units in connection with acquisition (Note 2) | $ 48,033 | |||
Issuance of share-based compensation awards | 853 | 844 | ||
Noncash amortization of share-based compensation | $ 12,538 | $ 9,251 | ||
Exercise of stock options, units | 22,000 | 252,000 | ||
Exercise of stock options | $ 937 | $ 10,738 | ||
Repurchase of common units and restricted stock units, units | (96,360) | (20,752) | ||
Repurchase of common units, stock options and restricted stock units | $ (5,883) | $ (1,836) | ||
Settlement of restricted stock units, units | 69,238 | 37,403 | ||
Settlement of restricted stock units | $ 0 | $ 0 | ||
Preferred distributions | (6,625) | (6,625) | ||
Distributions declared per common unit ($0.725 and $0.70 per unit for the six months ended 2016 and 2015, respectively) | (69,529) | (63,922) | ||
Ending Balance | $ 3,223,356 | $ 2,710,719 | $ 3,223,356 | $ 2,710,719 |
Ending Balance units | 94,886,044 | 90,198,802 | 94,886,044 | 90,198,802 |
Kilroy Realty, L.P. [Member] | Total Partners Capital [Member] | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning Balance | $ 3,224,020 | $ 2,714,311 | ||
Net income | 211,423 | 102,445 | ||
Issuance of common units | 137,924 | |||
Issuance of common units in connection with acquisition (Note 2) | 48,033 | |||
Issuance of share-based compensation awards | 853 | 844 | ||
Noncash amortization of share-based compensation | 12,538 | 9,251 | ||
Exercise of stock options | 937 | 10,738 | ||
Repurchase of common units, stock options and restricted stock units | (5,883) | (1,836) | ||
Settlement of restricted stock units | 0 | 0 | ||
Preferred distributions | (6,625) | (6,625) | ||
Distributions declared per common unit ($0.725 and $0.70 per unit for the six months ended 2016 and 2015, respectively) | (69,529) | (63,922) | ||
Ending Balance | $ 3,415,767 | $ 2,903,130 | 3,415,767 | 2,903,130 |
Kilroy Realty, L.P. [Member] | Noncontrolling Interest [Member] | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning Balance | 10,566 | 9,625 | ||
Net income | 582 | 147 | ||
Contribution by noncontrolling interest in consolidated subsidiary | 203 | |||
Contribution by noncontrolling interest in consolidated subsidiary | (281) | |||
Ending Balance | $ 10,867 | $ 9,975 | $ 10,867 | $ 9,975 |
Consolidated Statements of Ca12
Consolidated Statements of Capital (KILROY REALTY, L.P.) (Parenthetical) - $ / shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Kilroy Realty, L.P. [Member] | ||||
Dividends declared per common unit (in dollars per unit) | $ 0.375 | $ 0.35 | $ 0.725 | $ 0.7 |
Consolidated Statements of Ca13
Consolidated Statements of Cash Flows (KILROY REALTY, L.P.) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 212,005 | $ 102,592 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization of building and improvements and leasing costs | 102,127 | 101,812 |
Depreciation of furniture, fixtures and equipment | 1,659 | 1,333 |
Increase in provision for bad debts | 0 | 289 |
Noncash amortization of share-based compensation awards | 10,034 | 7,650 |
Noncash amortization of deferred financing costs and debt discounts and premiums | 1,306 | 889 |
Noncash amortization of net below market rents (Note 4) | (3,243) | (5,029) |
Gains on sales of depreciable operating properties (Note 3) | (145,990) | (31,428) |
Loss (gain) on sales of land (Note 3) | 295 | (17,268) |
Noncash amortization of deferred revenue related to tenant-funded tenant improvements | (6,100) | (6,304) |
Straight-line rents | (18,537) | (28,575) |
Net change in other operating assets | (6,071) | (9,100) |
Net change in other operating liabilities | (9,856) | (33) |
Net cash provided by operating activities | 137,629 | 116,828 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Expenditures for development properties and undeveloped land | (162,122) | (199,358) |
Expenditures for acquisition of undeveloped land (Note 2) | (33,513) | (52,134) |
Expenditures for acquisition of operating properties (Note 2) | (55,415) | 0 |
Expenditures for operating properties and other capital assets | (65,543) | (50,969) |
Net proceeds received from dispositions (Note 3) | 276,622 | 165,797 |
(Increase) decrease in restricted cash (Note 3) | (265,462) | 58,444 |
Decrease (increase) in acquisition-related deposits | 1,902 | (6,800) |
Increase in note receivable | (1,000) | 0 |
Net cash used in investing activities | (304,531) | (85,020) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Borrowings on unsecured revolving credit facility | 270,000 | 250,000 |
Repayments on unsecured revolving credit facility | (50,000) | (290,000) |
Principal payments on secured debt (Note 6) | (4,808) | (64,771) |
Financing costs | (679) | (769) |
Repurchase of common stock and restricted stock units | (5,883) | (1,836) |
Proceeds from exercise of stock options | 937 | 10,738 |
Distributions to noncontrolling interests in consolidated subsidiary | (281) | 0 |
Contributions from noncontrolling interests in consolidated subsidiary | 0 | 203 |
Distributions paid to common unitholders | (65,935) | (62,311) |
Distributions paid to preferred unitholders | (6,625) | (6,625) |
Net cash provided by (used in) financing activities | 136,726 | (27,447) |
Net (decrease) increase in cash and cash equivalents | (30,176) | 4,361 |
Cash and cash equivalents, beginning of period | 56,508 | 23,781 |
Cash and cash equivalents, end of period | 26,332 | 28,142 |
Kilroy Realty, L.P. [Member] | ||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | 212,005 | 102,592 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization of building and improvements and leasing costs | 102,127 | 101,812 |
Depreciation of furniture, fixtures and equipment | 1,659 | 1,333 |
Increase in provision for bad debts | 0 | 289 |
Noncash amortization of share-based compensation awards | 10,034 | 7,650 |
Noncash amortization of deferred financing costs and debt discounts and premiums | 1,306 | 889 |
Noncash amortization of net below market rents (Note 4) | (3,243) | (5,029) |
Gains on sales of depreciable operating properties (Note 3) | (145,990) | (31,428) |
Loss (gain) on sales of land (Note 3) | 295 | (17,268) |
Noncash amortization of deferred revenue related to tenant-funded tenant improvements | (6,100) | (6,304) |
Straight-line rents | (18,537) | (28,575) |
Net change in other operating assets | (6,071) | (9,100) |
Net change in other operating liabilities | (9,856) | (33) |
Net cash provided by operating activities | 137,629 | 116,828 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Expenditures for development properties and undeveloped land | (162,122) | (199,358) |
Expenditures for acquisition of undeveloped land (Note 2) | (33,513) | (52,134) |
Expenditures for acquisition of operating properties (Note 2) | (55,415) | 0 |
Expenditures for operating properties and other capital assets | (65,543) | (50,969) |
Net proceeds received from dispositions (Note 3) | 276,622 | 165,797 |
(Increase) decrease in restricted cash (Note 3) | (265,462) | 58,444 |
Decrease (increase) in acquisition-related deposits | 1,902 | (6,800) |
Increase in note receivable | (1,000) | |
Net cash used in investing activities | (304,531) | (85,020) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Net proceeds from issuance of common stock | 0 | 137,924 |
Borrowings on unsecured revolving credit facility | 270,000 | 250,000 |
Repayments on unsecured revolving credit facility | (50,000) | (290,000) |
Principal payments on secured debt (Note 6) | (4,808) | (64,771) |
Financing costs | (679) | (769) |
Repurchase of common stock and restricted stock units | (5,883) | (1,836) |
Proceeds from exercise of stock options | 937 | 10,738 |
Distributions to noncontrolling interests in consolidated subsidiary | (281) | 0 |
Contributions from noncontrolling interests in consolidated subsidiary | 0 | 203 |
Distributions paid to common unitholders | (65,935) | (62,311) |
Distributions paid to preferred unitholders | (6,625) | (6,625) |
Net cash provided by (used in) financing activities | 136,726 | (27,447) |
Net (decrease) increase in cash and cash equivalents | (30,176) | 4,361 |
Cash and cash equivalents, beginning of period | 56,508 | 23,781 |
Cash and cash equivalents, end of period | $ 26,332 | $ 28,142 |
Organization and Basis of Prese
Organization and Basis of Presentation | 6 Months Ended |
Jun. 30, 2016 | |
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 County, 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”) and Kilroy Realty Finance Partnership, L.P. (the “Finance Partnership”). We generally 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 June 30, 2016 : Number of Buildings Rentable Square Feet Number of Tenants Percentage Occupied Stabilized Office Properties 102 13,660,231 526 95.5 % Our stabilized office portfolio includes all of our properties with the exception of development and redevelopment properties currently under construction or committed for construction, “lease-up” properties, real estate assets held for sale, undeveloped land and our recently completed residential property. We define redevelopment properties as those properties for which we expect to spend significant development and construction costs on the 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 office properties we recently developed or redeveloped that have not yet reached 95% occupancy and are within one year following cessation of major construction activities. During the six months ended June 30, 2016 , we stabilized two development projects consisting of 455,340 rentable square feet and 185,602 rentable square feet in San Francisco, California which were included in our stabilized office portfolio as of June 30, 2016 . As of June 30, 2016 , the following properties, in addition to our recently completed residential property, were excluded from our stabilized office portfolio. We did not have any redevelopment properties at June 30, 2016. Number of Properties/Projects Estimated Rentable Square Feet (1) Properties held for sale (2) 2 136,908 Development projects in “ lease-up ” 2 443,000 Development projects under construction 1 700,000 ________________________ (1) Estimated rentable square feet upon completion. (2) These properties include two operating properties totaling 136,908 rentable square feet and a 7.0 acre undeveloped land parcel. See Note 3 “Dispositions and Real Estate Assets Held for Sale” for additional information. Our stabilized office portfolio also excludes our near-term and future development pipeline, which as of June 30, 2016 was comprised of eight development sites, representing approximately 70 gross acres of undeveloped land. As of June 30, 2016 , all of our properties and development projects were owned and all of our business was conducted in the state of California with the exception of twelve office properties and one future development project located in the state of Washington. As of June 30, 2016, we owned 100% of our properties and development projects, excluding two office properties owned by Redwood City Partners, LLC (“Redwood LLC”), a consolidated subsidiary. Ownership and 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 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 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. As of June 30, 2016 , the Company owned an approximate 97.2% common general partnership interest in the Operating Partnership. The remaining approximate 2.8% common limited partnership interest in the Operating Partnership as of June 30, 2016 was owned by non-affiliated investors and certain of our executive officers and directors (see Note 7). Both the general and limited common partnership interests in the Operating Partnership are denominated in common units. Generally, the number of common units held by the Company is 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 7). 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% common general partnership interest in the Finance Partnership. The Operating Partnership owns the remaining 99.0% common limited partnership interest. Kilroy Services, LLC (“KSLLC”), which is a wholly owned subsidiary of the Operating Partnership, is the entity through which we generally conduct substantially all of our development activities. As of June 30, 2016 , the Company owned an approximate 93% equity interest in Redwood LLC. The remaining interest was owned by an unrelated third party. With the exception of the Operating Partnership and Redwood LLC, all of our subsidiaries are wholly owned. 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, 2016 . 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, 2015 . Adoption of New Accounting Pronouncements Variable Interest Entities Effective January 1, 2016, the Company adopted Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) No. 2015-02 (“ASU 2015-02”), which amended certain guidance with respect to the evaluation of Variable Interest Entities (“VIEs”) and when a reporting entity is required to consolidate certain legal entities. Specifically, the amendments: (i) modify the evaluation of whether limited partnerships and similar legal entities are VIEs or voting interest entities, (ii) eliminate the presumption that a general partner should consolidate a limited partnership, (iii) affect the consolidation analysis of reporting entities that are involved with VIEs, and (iv) provide a scope exception for certain entities. Under the new guidance, effective January 1, 2016 the Operating Partnership was determined to be a VIE of the Company as the Operating Partnership is a limited partnership in which the common limited partners do not have substantive kick-out rights or participating rights. However, given that the Company was deemed to be the primary beneficiary of the Operating Partnership, the adoption of this new guidance and the conclusion that the Operating Partnership was a VIE did not have any impact on our consolidated financial statements since the conclusion to consolidate the Operating Partnership still applied. The Operating Partnership was the only new VIE identified as part of the adoption of the guidance as of January 1, 2016. At June 30, 2016 , the consolidated financial statements of the Company included only one VIE, the Operating Partnership, and the consolidated financial statements of the Operating Partnership did not include any VIEs. At December 31, 2015 , the consolidated financial statements of the Company and the Operating Partnership included two VIEs in which we were deemed to be the primary beneficiary: Redwood LLC and one other VIE to facilitate potential future Section 1031 Exchanges to defer taxable gains on dispositions for federal income tax purposes. At December 31, 2015 , the impact of consolidating the VIEs increased the Company’s total assets, liabilities and noncontrolling interests by approximately $203.3 million (of which $187.3 million related to real estate held for investment on our consolidated balance sheet), approximately $28.8 million and approximately $6.5 million , respectively. During the three months ended June 30, 2016 , Redwood LLC had a VIE reconsideration event and was determined to no longer be a VIE and the VIE to facilitate potential future Section 1031 Exchanges was terminated. Reclassification of Debt Issuance Costs Effective January 1, 2016, the Company adopted FASB ASU No. 2015-03 and No. 2015-15, which requires that debt issuance costs related to a recognized debt liability be presented on the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. However, for line-of-credit arrangements, entities may defer and present debt issuance costs as an asset and amortize the costs ratably over the term of the line of credit arrangement, regardless of whether there are any outstanding borrowings on the line of credit arrangement. As a result of our adoption of the guidance, $1.1 million of deferred financing costs as of December 31, 2015 were reclassified to reduce secured debt, net and $12.0 million of deferred financing costs as of December 31, 2015 were reclassified to reduce unsecured debt, net in the December 31, 2015 balances on our consolidated balance sheets. In addition, $4.6 million of deferred financing costs relating to our unsecured line of credit as of December 31, 2015 were reclassified to prepaid expenses and other assets, net in the December 31, 2015 balances on our consolidated balance sheets. The guidance did not have a material impact on our consolidated financial statements. Recently Issued Accounting Pronouncements On June 16, 2016, the FASB issued ASU No. 2016-13 (“ASU 2016-13”) to amend the accounting for credit losses for certain financial instruments. Under the new guidance, an entity recognizes its estimate of expected credit losses as an allowance, which the FASB believes will result in more timely recognition of such losses. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company is currently assessing the impact of the guidance on our consolidated financial statements and notes to our consolidated financial statements. On May 9, 2016, the FASB issued ASU No. 2016-12, which clarifies and provides practical expedients for certain aspects of ASU No. 2014-09, which outlines a single comprehensive model for entities to use in accounting for revenues arising from contracts with customers and notes that lease contracts with customers are a scope exception. Public business entities may elect to adopt the amendments as of the original effective date; however, adoption is required for annual reporting periods beginning after December 15, 2017. The Company is currently assessing the impact of the guidance on our consolidated financial statements and notes to our consolidated financial statements. On March 30, 2016, the FASB issued ASU No. 2016-09 (“ASU 2016-09”) to amend the accounting guidance for share-based payment accounting. The areas for simplification in ASU 2016-09 involve several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. ASU 2016-09 is effective for annual periods beginning after December 15, 2016 and interim periods within those annual periods and early adoption is permitted. The Company is currently assessing the impact of the guidance on our consolidated financial statements and notes to our consolidated financial statements. On February 25, 2016, the FASB issued ASU No. 2016-02 (“ASU 2016-02”) to amend the accounting guidance for leases. The accounting applied by a lessor is largely unchanged under ASU 2016-02. However, the standard requires lessees to recognize lease assets and lease liabilities for leases classified as operating leases on the balance sheet. Lessees will recognize in the statement of financial position a liability to make lease payments and a right-of-use asset representing its right to use the underlying asset for the lease term. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. If a lessee makes this election, it will recognize lease expense for such leases generally on a straight-line basis over the lease term. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018 and early adoption is permitted. The Company is currently assessing the impact of the guidance on our consolidated financial statements and notes to our consolidated financial statements. On January 5, 2016, the FASB issued ASU No. 2016-01 (“ASU 2016-01”) to amend the accounting guidance on the classification and measurement of financial instruments. The standard requires that all investments in equity securities, including other ownership interests, are carried at fair value through net income. This requirement does not apply to investments that qualify for equity method accounting or to those that result in consolidation of the investee or for which the entity has elected the predictability exception to fair value measurement. Additionally, the standard requires that the portion of the total fair value change caused by a change in instrument-specific credit risk for financial liabilities for which the fair value option has been elected would be recognized in other comprehensive income. Any accumulated amount remaining in other comprehensive income is reclassified to earnings when the liability is extinguished. ASU 2016-01 is effective for fiscal years beginning after December 15, 2017. The Company does not anticipate the guidance to have a material impact on our consolidated financial statements or notes to our consolidated financial statements. |
Acquisitions
Acquisitions | 6 Months Ended |
Jun. 30, 2016 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions Operating Property Acquisitions During the six months ended June 30, 2016 , we acquired the one operating property listed below from an unrelated third party. The acquisition was funded with proceeds from the Company’s unsecured revolving credit facility as well as proceeds from our capital recycling program. Property Date of Acquisition Number of Buildings Rentable Square Feet (unaudited) Purchase Price (in millions) (1) 1290-1300 Terra Bella Avenue, Mountain View, CA June 8, 2016 1 114,175 $ 55.4 ________________________ (1) In connection with this acquisition, we assumed $0.2 million in accrued liabilities that are not included in the purchase price above. The related assets, liabilities and results of operations of the acquired property 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 as of the date of acquisition: Total 2016 Operating Property Acquisitions (1) Assets Land and improvements $ 28,730 Buildings and improvements (2) 27,555 Deferred leasing costs and acquisition-related intangible assets (3) 4,180 Total assets acquired 60,465 Liabilities Accounts payable, accrued expenses and other liabilities 170 Deferred revenue and acquisition-related intangible liabilities (4) 4,880 Total liabilities assumed 5,050 Net assets and liabilities acquired $ 55,415 ________________________ (1) The purchase price of the acquisition completed during the six months ended June 30, 2016 was less than 5% of the Company’s total assets as of June 30, 2016. (2) Represents buildings, building improvements and tenant improvements. (3) Represents in-place leases (approximately $2.5 million with a weighted average amortization period of 3.6 years) and leasing commissions (approximately $1.7 million with a weighted average amortization period of 3.7 years). (4) Represents below-market leases (approximately $4.9 million with a weighted average amortization period of 3.4 years). Development Project Acquisitions On March 11, 2016 , we acquired an approximately 1.75 acre development site located at 610-620 Brannan Street in San Francisco, California from an unrelated third party. This land parcel is immediately adjacent to our Flower Mart project in the SOMA submarket of San Francisco. The acquisition was funded through $31.0 million in cash and the issuance of 867,701 common units in the Operating Partnership valued at approximately $48.0 million (see Note 9). In addition, the Company paid $2.4 million in seller transaction costs and recorded $4.7 million in accrued liabilities in connection with this acquisition. As of June 30, 2016 , the underlying assets were included as undeveloped land and construction in progress on our consolidated balance sheets. |
Dispositions
Dispositions | 6 Months Ended |
Jun. 30, 2016 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Dispositions and Real Estate Assets Held for Sale | Dispositions and Real Estate Assets Held for Sale Land Dispositions The following table summarizes the land dispositions completed during the six months ended June 30, 2016 : Property Submarket Month of Disposition Gross Site Acreage (unaudited) Sales Price (1) (in millions) Carlsbad Oaks - Lot 7 (2) Carlsbad January 7.6 $ 4.5 Carlsbad Oaks - Lots 4 & 5 Carlsbad June 11.2 6.0 Carlsbad Oaks - Lot 8 Carlsbad June 13.2 8.9 Total Land Dispositions (3) 32.0 $ 19.4 ________________________ (1) Represents gross sales price before the impact of broker commissions and closing costs. (2) This land parcel was classified as held for sale as of December 31, 2015. (3) In connection with these land dispositions, $2.3 million of secured debt was assumed by the buyers. See Note 6 “Secured and Unsecured Debt of the Operating Partnership” for additional information. The net loss on the four undeveloped land parcels sold during the six months ended June 30, 2016 was approximately $0.3 million . Operating Property Dispositions The following table summarizes the operating properties sold during the six months ended June 30, 2016 . Location Property Type Month of Disposition Number of Buildings Rentable Square Feet Sales Price (1) (in millions) Torrey Santa Fe Properties (2) Office January 4 465,812 $ 262.3 ________________________ (1) Represents gross sales price before the impact of broker commissions and closing costs. (2) The Torrey Santa Fe Properties include the following: 7525 Torrey Santa Fe, 7535 Torrey Santa Fe, 7545 Torrey Santa Fe, and 7555 Torrey Santa Fe. These properties were classified as held for sale at December 31, 2015 . The total gain on the four operating properties sold during the six months ended June 30, 2016 was $146.0 million . As of June 30, 2016 , approximately $258.1 million of net proceeds related to this disposition were temporarily being held at qualified intermediaries, at our direction, for the purpose of facilitating potential future Section 1031 Exchanges. The cash proceeds are included in restricted cash on our consolidated balance sheets at June 30, 2016 . Real Estate Assets Held for Sale As of June 30, 2016 , the following properties were classified as held for sale: Location Submarket Property Type Number of Buildings Rentable Square Feet 4930, 4939 & 4955 Directors Place (1) Sorrento Mesa Office 2 136,908 ________________________ (1) These properties include two operating properties totaling 136,908 rentable square feet and a 7.0 acre undeveloped land parcel. On July 21, 2016, the Company completed the sale of these properties for a gross sales price of $49.0 million . The major classes of assets and liabilities of the properties held for sale as of June 30, 2016 were as follows: Real estate assets and other assets held for sale (in thousands) Land and improvements $ 5,377 Buildings and improvements 34,246 Undeveloped land 12,355 Total real estate held for sale 51,978 Accumulated depreciation and amortization (22,400 ) Total real estate held for sale, net 29,578 Deferred rent receivables, net 467 Deferred leasing costs and acquisition-related intangible assets, net 57 Prepaid expenses and other assets, net 155 Real estate and other assets held for sale, net $ 30,257 Liabilities and deferred revenue of real estate assets held for sale Accounts payable, accrued expenses and other liabilities $ 120 Deferred revenue and acquisition-related intangible liabilities, net 201 Liabilities and deferred revenue of real estate assets held for sale $ 321 |
Deferred Leasing Costs and Acqu
Deferred Leasing Costs and Acquisition-Related Intangible Assets and Liabilities, net | 6 Months Ended |
Jun. 30, 2016 | |
Intangible Assets and Liabilities Disclosure [Abstract] | |
Deferred Leasing Costs and Acquisition-Related Intangible Assets and Liabilities, net | 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 June 30, 2016 and December 31, 2015 : June 30, 2016 December 31, 2015 (in thousands) Deferred Leasing Costs and Acquisition-Related Intangible Assets, net: (1) Deferred leasing costs $ 228,701 $ 205,888 Accumulated amortization (81,460 ) (72,745 ) Deferred leasing costs, net 147,241 133,143 Above-market operating leases 10,662 10,989 Accumulated amortization (7,188 ) (6,739 ) Above-market operating leases, net 3,474 4,250 In-place leases 72,944 72,639 Accumulated amortization (37,212 ) (33,810 ) In-place leases, net 35,732 38,829 Below-market ground lease obligation 490 490 Accumulated amortization (34 ) (29 ) Below-market ground lease obligation, net 456 461 Total deferred leasing costs and acquisition-related intangible assets, net $ 186,903 $ 176,683 Acquisition-Related Intangible Liabilities, net: (2) (3) Below-market operating leases $ 57,166 $ 53,502 Accumulated amortization (29,899 ) (27,074 ) Below-market operating leases, net 27,267 26,428 Above-market ground lease obligation 6,320 6,320 Accumulated amortization (475 ) (424 ) Above-market ground lease obligation, net 5,845 5,896 Total acquisition-related intangible liabilities, net $ 33,112 $ 32,324 ________________________ (1) Excludes deferred leasing costs and acquisition-related intangible assets, net related to properties held for sale. (2) Excludes acquisition-related intangible liabilities, net related to properties held for sale. (3) 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 for the three and six months ended June 30, 2016 and 2015 : Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 (in thousands) Deferred leasing costs (1) $ 6,961 $ 7,093 $ 13,744 $ 13,914 Above-market operating leases (2) 384 737 776 1,648 In-place leases (1) 2,669 4,416 5,557 8,637 Below-market ground lease obligation (3) 2 2 4 4 Below-market operating leases (4) (2,024 ) (3,838 ) (4,019 ) (6,677 ) Above-market ground lease obligation (5) (25 ) (25 ) (50 ) (50 ) Total $ 7,967 $ 8,385 $ 16,012 $ 17,476 ________________________ (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 June 30, 2016 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 2016 $ 14,251 $ 725 $ 5,466 $ 4 $ (4,494 ) $ (50 ) 2017 26,180 1,241 9,738 8 (8,437 ) (101 ) 2018 22,883 831 6,998 8 (7,159 ) (101 ) 2019 18,748 643 5,149 8 (4,583 ) (101 ) 2020 14,495 16 2,923 8 (2,169 ) (101 ) Thereafter 50,684 18 5,458 420 (425 ) (5,391 ) Total $ 147,241 $ 3,474 $ 35,732 $ 456 $ (27,267 ) $ (5,845 ) ________________________ (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 | 6 Months Ended |
Jun. 30, 2016 | |
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 June 30, 2016 and December 31, 2015 : June 30, 2016 December 31, 2015 (in thousands) Current receivables $ 11,930 $ 13,233 Allowance for uncollectible tenant receivables (1,818 ) (2,080 ) Current receivables, net (1) $ 10,112 $ 11,153 ________________________ (1) Excludes current receivables, net related to real estate held for sale. Deferred Rent Receivables, net Deferred rent receivables, net consisted of the following as of June 30, 2016 and December 31, 2015 : June 30, 2016 December 31, 2015 (in thousands) Deferred rent receivables $ 209,378 $ 191,586 Allowance for deferred rent receivables (1,527 ) (1,882 ) Deferred rent receivables, net (1) $ 207,851 $ 189,704 ________________________ (1) Excludes deferred rent receivables related to real estate held for sale. |
Secured and Unsecured Debt of t
Secured and Unsecured Debt of the Operating Partnership | 6 Months Ended |
Jun. 30, 2016 | |
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 June 30, 2016 and December 31, 2015 : Type of Debt Annual Stated Interest Rate (1) Effective Interest Rate (1)(2) Maturity Date June 30, 2016 December 31, 2015 (in thousands) Mortgage note payable (4) 4.27% 4.27% February 2018 $ 127,049 $ 128,315 Mortgage note payable (4) 4.48% 4.48% July 2027 95,563 96,354 Mortgage note payable (3) (4) 6.05% 3.50% June 2019 84,179 85,890 Mortgage note payable 6.51% 6.51% February 2017 64,994 65,563 Mortgage note payable 7.15% 7.15% May 2017 2,625 3,987 Other (5) Various Various Various — 1,809 Total secured debt $ 374,410 $ 381,918 Unamortized deferred financing costs (910 ) (1,083 ) Total secured debt, net $ 373,500 $ 380,835 ________________________ (1) All interest rates presented are fixed-rate interest rates. (2) Represents the effective interest rate including the amortization of initial issuance discounts/premiums excluding the amortization of deferred financing costs. (3) Amounts reported include the amounts of unamortized debt premiums of $5.3 million and $6.2 million as of June 30, 2016 and December 31, 2015 , respectively. (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) Balance of $1.8 million as of December 31, 2015 included public facility bonds that were assumed by the buyers in connection with sales of land during the six months ended June 30, 2016 . 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. Unsecured Senior Notes The following table summarizes the balance and significant terms of the registered unsecured senior notes issued by the Operating Partnership as of June 30, 2016 and December 31, 2015 : Principal Amount as of Issuance date Maturity date Stated coupon rate Effective interest rate (1) June 30, December 31, 2015 (in thousands) 4.375% Unsecured Senior Notes (2) September 2015 October 2025 4.375% 4.440% $ 400,000 $ 400,000 Unamortized discount and deferred financing costs (5,123 ) (5,400 ) Net carrying amount $ 394,877 $ 394,600 4.250% Unsecured Senior Notes (3) July 2014 August 2029 4.250% 4.350% $ 400,000 $ 400,000 Unamortized discount and deferred financing costs (6,962 ) (7,228 ) Net carrying amount $ 393,038 $ 392,772 3.800% Unsecured Senior Notes (4) January 2013 January 2023 3.800% 3.804% $ 300,000 $ 300,000 Unamortized discount and deferred financing costs (1,794 ) (1,931 ) Net carrying amount $ 298,206 $ 298,069 4.800% Unsecured Senior Notes (4) (5) July 2011 July 2018 4.800% 4.827% $ 325,000 $ 325,000 Unamortized discount and deferred financing costs (1,009 ) (1,251 ) Net carrying amount $ 323,991 $ 323,749 6.625% Unsecured Senior Notes (6) May 2010 June 2020 6.625% 6.743% $ 250,000 $ 250,000 Unamortized discount and deferred financing costs (2,142 ) (2,414 ) Net carrying amount $ 247,858 $ 247,586 Total Unsecured Senior Notes, Net $ 1,657,970 $ 1,656,776 ________________________ (1) Represents the effective interest rate including the amortization of initial issuance discounts/premiums excluding the amortization of deferred financing costs. (2) Interest on these notes is payable semi-annually in arrears on April 1st and October 1st of each year. (3) Interest on these notes is payable semi-annually in arrears on February 15th and August 15th of each year. (4) Interest on these notes is payable semi-annually in arrears on January 15th and July 15th of each year. (5) In October 2015, certain common limited partners in the Operating Partnership that previously contributed their interests in the property at 6255 W. Sunset Blvd., Los Angeles, California to the Operating Partnership entered into an agreement with the Company. Pursuant to this agreement, such common limited partners will reimburse the Company for a portion of any amounts the Company may be required to pay pursuant to its guarantee of the Operating Partnership’s 4.800% Senior Notes due 2018 or that the Company may otherwise become required to pay under applicable law with respect to such notes. (6) Interest on these notes is payable semi-annually in arrears on June 1st and December 1st of each year. Unsecured Term Loan Facility The following table summarizes the balance and terms of our unsecured term loan facility as of June 30, 2016 and December 31, 2015 : June 30, 2016 December 31, 2015 (in thousands) Outstanding borrowings (1) $ 150,000 $ 150,000 Interest rate (2) 1.62 % 1.40 % Maturity date July 2019 ________________________ (1) As of June 30, 2016 and December 31, 2015 , $0.8 million and $0.9 million of unamortized deferred financing costs, respectively, remained to be amortized through the maturity date of our unsecured term loan facility. (2) Our unsecured term loan facility interest rate was calculated based on an annual rate of LIBOR plus 1.150% as of June 30, 2016 and December 31, 2015 . Additionally, the Company has a $39.0 million unsecured term loan outstanding with an annual interest rate of LIBOR plus 1.150% as of June 30, 2016 and December 31, 2015 , that matures in July 2019. As of June 30, 2016 and December 31, 2015 , $0.2 million of unamortized deferred financing costs remained to be amortized through the maturity date of our unsecured term loan. Unsecured Revolving Credit Facility The Company intends to borrow amounts under the unsecured 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. The following table summarizes the balance and terms of our unsecured revolving credit facility as of June 30, 2016 and December 31, 2015 : June 30, 2016 December 31, 2015 (in thousands) Outstanding borrowings (1) $ 220,000 $ — Remaining borrowing capacity 380,000 600,000 Total borrowing capacity (2) $ 600,000 $ 600,000 Interest rate (3) 1.52 % 1.40 % Facility fee-annual rate (4) 0.200% Maturity date July 2019 ________________________ (1) On July 20, 2016, we repaid the total outstanding borrowings on our unsecured revolving credit facility. Refer to Note 17 “Subsequent Events” for additional information. (2) We may elect to borrow, subject to bank approval and obtaining commitments for any additional borrowing capacity, up to an additional $311.0 million under an accordion feature under the terms of the unsecured revolving credit facility and term loan facility. (3) Our unsecured revolving credit facility interest rate was calculated based on an annual rate of LIBOR plus 1.050% as of June 30, 2016 and December 31, 2015 . (4) Our facility fee is paid on a quarterly basis and is calculated based on the total borrowing capacity. In addition to the facility fee, we incurred debt origination and legal costs. As of June 30, 2016 and December 31, 2015 , $3.9 million and $4.6 million , of unamortized deferred financing costs, respectively, remained to be amortized through the maturity date of our unsecured revolving credit facility, which are included in prepaid expenses and other assets, net on our consolidated balance sheets. Debt Covenants and Restrictions The unsecured revolving credit facility, the unsecured term loan facility, the unsecured term loan, 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 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 June 30, 2016 . Debt Maturities The following table summarizes the stated debt maturities and scheduled amortization payments, excluding unamortized debt discounts, premiums and deferred financing costs, as of June 30, 2016 : Year (in thousands) Remaining 2016 $ 4,926 2017 71,692 2018 451,669 2019 485,309 2020 251,913 Thereafter 1,187,589 Total (1) $ 2,453,098 ________________________ (1) Includes gross principal balance of outstanding debt before the effect of the following at June 30, 2016 : $11.9 million of unamortized deferred financing costs, $7.0 million of unamortized discounts for the unsecured senior notes and $5.3 million of unamortized premiums for the secured debt. Capitalized Interest and Loan Fees The following table sets forth gross interest expense, including debt discount/premium and deferred financing cost amortization, net of capitalized interest, for the three and six months ended June 30, 2016 and 2015 . The interest expense capitalized was recorded as a cost of development and increased the carrying value of undeveloped land and construction in progress. Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 (in thousands) Gross interest expense $ 26,668 $ 27,187 $ 52,843 $ 54,936 Capitalized interest and deferred financing costs (12,284 ) (12,323 ) (26,630 ) (23,194 ) Interest expense $ 14,384 $ 14,864 $ 26,213 $ 31,742 |
Noncontrolling Interests on the
Noncontrolling Interests on the Company's Consolidated Financial Statements | 6 Months Ended |
Jun. 30, 2016 | |
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 an approximate 97.2% , 98.1% and 98.0% common general partnership interest in the Operating Partnership as of June 30, 2016 , December 31, 2015 and June 30, 2015 , respectively. The remaining approximate 2.8% , 1.9% and 2.0% common limited partnership interest as of June 30, 2016 , December 31, 2015 and June 30, 2015 , respectively, was owned by non-affiliated investors and certain of our executive officers and directors in the form of noncontrolling common units. There were 2,631,276 , 1,764,775 and 1,793,170 common units outstanding held by these investors, executive officers and directors as of June 30, 2016 , December 31, 2015 and June 30, 2015 , respectively. The increase in the common units from December 31, 2015 to June 30, 2016 was attributable to 867,701 common units issued in connection with an acquisition (see Note 2) partially offset by a unit redemption. The noncontrolling common units may be redeemed by unitholders for cash. Except under certain circumstances, we, at our option, may satisfy the cash redemption obligation with shares of the Company’s common stock on a one-for-one basis. If satisfied in cash, 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 $168.8 million and $112.0 million as of June 30, 2016 and December 31, 2015 , 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. |
Stockholders' Equity of the Com
Stockholders' Equity of the Company | 6 Months Ended |
Jun. 30, 2016 | |
Equity [Abstract] | |
Stockholders' Equity of the Company | Stockholders’ Equity of the Company At-The-Market Stock Offering Program Under our current at-the-market stock offering program, which commenced in December 2014, we may offer and sell shares of our common stock having an aggregate gross sales price of up to $300.0 million from time to time in “at-the-market” offerings. No shares of common stock were sold under this program during the six months ended June 30, 2016 . Since commencement of the program through June 30, 2016 , we have sold 2,007,767 shares of common stock having an aggregate gross sales price of $150.1 million . As of June 30, 2016 , shares of common stock having an aggregate gross sales price of up to $149.9 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. Common Stock Repurchases On February 23, 2016, the Company’s Board of Directors approved a 4,000,000 share increase to the Company’s existing share repurchase program bringing the total current repurchase authorization to 4,988,025 shares. During the three months ended March 31, 2016, the Company repurchased 52,199 shares of common stock at a weighted average price of $55.45 per common share for $2.9 million . No shares of common stock were repurchased under this program during the three months ended June 30, 2016 . As of June 30, 2016 , 4,935,826 shares remain eligible for repurchase under the Company’s share repurchase program. |
Partners' Capital of the Operat
Partners' Capital of the Operating Partnership | 6 Months Ended |
Jun. 30, 2016 | |
Partners' Capital Notes [Abstract] | |
Partners’ Capital of the Operating Partnership | Partners’ Capital of the Operating Partnership Issuance of Common Units In March 2016, the Operating Partnership issued 867,701 common units in connection with a development acquisition as discussed in Note 2. Each common unit was valued at $55.36 , which was based on a trailing ten-day average of the closing quoted price per share of the Company’s common stock, par value $.01 per share, as reported on the NYSE, as calculated in accordance with the Partnership Agreement. 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-affiliated 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: June 30, 2016 December 31, 2015 June 30, 2015 Company owned common units in the Operating Partnership 92,254,768 92,258,690 88,405,632 Company owned general partnership interest 97.2 % 98.1 % 98.0 % Noncontrolling common units of the Operating Partnership 2,631,276 1,764,775 1,793,170 Ownership interest of noncontrolling interest 2.8 % 1.9 % 2.0 % For further discussion of the noncontrolling common units as of June 30, 2016 and December 31, 2015 , refer to Note 7. |
Share-Based Compensation
Share-Based Compensation | 6 Months Ended |
Jun. 30, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-Based Compensation | Share-Based Compensation Stockholder Approved Equity Compensation Plans As of June 30, 2016 , we maintained one share-based incentive compensation plan, the Kilroy Realty 2006 Incentive Award Plan, as amended (the “2006 Plan”). As of June 30, 2016 , 1,382,879 shares were available for grant under the 2006 Plan. The calculation of shares available for grant is presented after taking into account a reserve for a sufficient number of shares to cover the vesting and payment of 2006 Plan awards that were outstanding on that date, including performance-based vesting awards at (i) levels actually achieved for the performance conditions (as defined below) and (ii) at target levels for the market conditions (as defined below) applicable to these awards. 2016 Share-Based Compensation Grants On January 28, 2016 , the Executive Compensation Committee of the Company’s Board of Directors awarded 294,821 restricted stock units (“RSUs”) to certain officers of the Company under the 2006 Plan, which included 168,077 RSUs (at the target level of performance), or 57% , that are subject to market and performance-based vesting requirements (the “2016 Performance-Based RSUs”) and 126,744 RSUs, or 43% , that are subject to time-based vesting requirements (the “2016 Time-Based RSUs”). On January 9, 2016 , the Executive Compensation Committee of the Company’s Board of Directors awarded 33,910 RSUs to the Company’s Chief Operating Officer under the 2006 Plan (the “2016 Special RSUs”). 2016 Performance-Based RSU Grant The 2016 Performance-Based RSUs are scheduled to vest at the end of a three -year period based upon the achievement of pre-set FFO per share goals (the “performance condition”) for the year ending December 31, 2016 and also based upon the average annual relative total stockholder return ranking for the Company compared to an established comparison group of companies (the “market condition”) for the three -year period ending December 31, 2018. The 2016 Performance-Based RSUs are also subject to a three -year service vesting provision and are scheduled to cliff vest at the end of the three -year period. The number of 2016 Performance-Based RSUs ultimately earned could fluctuate from the target number of 2016 Performance-Based RSUs granted based upon the levels of achievement for both the performance condition and the market condition. The estimate of the number of 2016 Performance-Based RSUs earned are evaluated quarterly during the 2016 performance period based on our estimate as to the 2016 FFO per share performance measured against the applicable goals. As of June 30, 2016 , 214,632 2016 Performance-Based RSUs are estimated to be earned based on the Company’s estimate of 2016 FFO per share performance measured against the applicable goals, and the compensation cost recorded to date for this program was based on that estimate. Compensation expense for the 2016 Performance-Based RSU grant will be recorded on a straight-line basis over the three -year period. Each 2016 Performance-Based RSU represents the right to receive one share of our common stock in the future. The total fair value of the 2016 Performance-Based RSU grant was $9.6 million at January 28, 2016 and was calculated using a Monte Carlo simulation pricing model based on the assumptions in the table below. The determination of the fair value of the 2016 Performance-Based RSU grant takes into consideration the likelihood of achievement of both the performance condition and the market condition discussed above. For the six months ended June 30, 2016 , we recorded compensation expense based upon the $57.08 fair value at January 28, 2016 . The following table summarizes the assumptions utilized in the Monte Carlo simulation pricing model: Fair Value Assumptions Fair value per share at January 28, 2016 $57.08 Expected share price volatility 26.00% Risk-free interest rate 1.13% Remaining expected life 2.9 years The computation of expected volatility is based on a blend of the historical volatility of our shares of common stock over approximately six years, as that is expected to be most consistent with future volatility and equates to a time period twice as long as the approximate three-year remaining performance period 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 January 28, 2016 . The expected life of the RSUs is equal to the remaining 2.9 year vesting period at January 28, 2016 . 2016 Time-Based RSU Grant The 2016 Time-Based RSUs are scheduled to vest in three equal installments beginning on January 5, 2017 through January 5, 2019. Compensation expense for the 2016 Time-Based RSUs will be recognized on a straight-line basis over the three -year service vesting period. Each 2016 Time-Based RSU represents the right to receive one share of our common stock in the future. The total fair value of the 2016 Time-Based RSU grant was $7.1 million , which was based on the $56.23 closing share price of the Company’s common stock on the NYSE on January 28, 2016 . 2016 Special RSU Grant The 2016 Special RSUs are scheduled to vest in four equal installments beginning on December 31, 2016 through December 31, 2019 based on the achievement of certain metrics. Compensation expense for the 2016 Special RSUs will be recognized on a straight-line basis over the four-year service vesting period. Each 2016 Special RSU represents the right to receive one share of our common stock in the future. The total fair value of the 2016 Special RSU grant was $2.0 million , which was based on the $58.98 closing share price of the Company’s common stock on the NYSE on January 8, 2016 for the time-based portion, and the estimated fair value at date of grant for the performance-based portion. Share-Based Compensation Cost Recorded During the Period The total compensation cost for all share-based compensation programs was $6.6 million and $5.0 million for the three months ended June 30, 2016 and 2015 , respectively, and $12.5 million and $9.3 million for the six months ended June 30, 2016 and 2015 , respectively. Of the total share-based compensation costs, $1.3 million and $0.9 million was capitalized as part of real estate assets for the three months ended June 30, 2016 and 2015 , respectively, and $2.5 million and $1.6 million for the six months ended June 30, 2016 and 2015 . As of June 30, 2016 , there was approximately $40.5 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 2.0 years. The remaining compensation cost related to these nonvested incentive awards had been recognized in periods prior to June 30, 2016 . |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies General As of June 30, 2016 , we had commitments of approximately $394.3 million , excluding our ground lease commitments, for contracts and executed leases directly related to our operating properties and development projects. Environmental Matters We follow the policy of monitoring all of our properties, both acquisition and existing stabilized portfolio 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 our stabilized portfolio properties that would have a material adverse effect on our financial condition, results of operations and cash flow, or that we believe would require additional disclosure or the recording of a loss contingency. As of June 30, 2016 , we had accrued environmental remediation liabilities of approximately $26.0 million recorded on our consolidated balance sheets in connection with recent development acquisitions and certain of our development projects. It is possible that we could incur additional environmental remediation costs in connection with these recent development acquisitions. However, given we are in the very early stages of development on certain of these projects, potential additional environmental costs are not reasonably estimable at this time. |
Fair Value Measurements and Dis
Fair Value Measurements and Disclosures | 6 Months Ended |
Jun. 30, 2016 | |
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 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 June 30, 2016 and December 31, 2015 : Fair Value (Level 1) (1) June 30, 2016 December 31, 2015 Description (in thousands) Marketable securities (2) $ 13,388 $ 12,882 ________________________ (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 also 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 six months ended June 30, 2016 and 2015 : Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Description (in thousands) (in thousands) Net gain on marketable securities $ 249 $ 122 $ 386 $ 510 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 June 30, 2016 and December 31, 2015 : June 30, 2016 December 31, 2015 Carrying Fair (1) Carrying Fair (1) (in thousands) Liabilities Secured debt, net $ 373,500 $ 387,976 $ 380,835 $ 391,611 Unsecured debt, net 1,845,992 1,987,469 1,844,634 1,898,863 Unsecured line of credit 220,000 220,442 — — ________________________ (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. |
Net Income Available to Common
Net Income Available to Common Stockholders Per Share of the Company | 6 Months Ended |
Jun. 30, 2016 | |
Earnings Per Share [Abstract] | |
Net Income Available to Common Stockholders Per Share of the Company | Net Income 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 available to common stockholders for the three and six months ended June 30, 2016 and 2015 : Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 (in thousands, except share and per share amounts) Numerator: Net income attributable to Kilroy Realty Corporation $ 32,847 $ 57,500 $ 207,155 $ 100,687 Preferred dividends (3,312 ) (3,312 ) (6,625 ) (6,625 ) Allocation to participating securities (1) (423 ) (418 ) (818 ) (833 ) Numerator for basic and diluted net income available to common stockholders $ 29,112 $ 53,770 $ 199,712 $ 93,229 Denominator: Basic weighted average vested shares outstanding 92,209,955 88,126,187 92,217,238 87,514,878 Effect of dilutive securities 614,831 519,681 566,827 529,414 Diluted weighted average vested shares and common share equivalents outstanding 92,824,786 88,645,868 92,784,065 88,044,292 Basic earnings per share: Net income available to common stockholders per share $ 0.32 $ 0.61 $ 2.17 $ 1.07 Diluted earnings per share: Net income available to common stockholders per share $ 0.31 $ 0.61 $ 2.15 $ 1.06 ________________________ (1) Participating securities include nonvested shares, certain time-based RSUs and vested market measure-based RSUs. Share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are considered participating securities. The impact of potentially dilutive common shares, including stock options, RSUs and other securities are considered in our diluted earnings per share calculation for the three and six months ended June 30, 2016 and 2015 . Certain market measure-based RSUs are not included in dilutive securities for the three and six months ended June 30, 2016 and 2015 , as not all performance metrics had been met by the end of the applicable reporting periods. See Note 10 “Share-Based Compensation” for additional information regarding share-based compensation. |
Net Income Available to Commo27
Net Income Available to Common Unitholders Per Unit of the Operating Partnership | 6 Months Ended |
Jun. 30, 2016 | |
Earnings Per Unit [Abstract] | |
Net Income Available to Common Unitholders Per Unit of the Operating Partnership | Net Income 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 available to common unitholders for the three and six months ended June 30, 2016 and 2015 : Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 (in thousands, except unit and per unit amounts) Numerator: Net income attributable to Kilroy Realty, L.P. $ 33,590 $ 58,518 $ 211,423 $ 102,445 Preferred distributions (3,312 ) (3,312 ) (6,625 ) (6,625 ) Allocation to participating securities (1) (423 ) (418 ) (818 ) (833 ) Numerator for basic and diluted net income available to common unitholders $ 29,855 $ 54,788 $ 203,980 $ 94,987 Denominator: Basic weighted average vested units outstanding 94,841,231 89,919,357 94,514,876 89,309,718 Effect of dilutive securities 614,831 519,681 566,827 529,414 Diluted weighted average vested units and common unit equivalents outstanding 95,456,062 90,439,038 95,081,703 89,839,132 Basic earnings per unit: Net income available to common unitholders per unit $ 0.31 $ 0.61 $ 2.16 $ 1.06 Diluted earnings per unit: Net income available to common unitholders per unit $ 0.31 $ 0.61 $ 2.15 $ 1.06 ________________________ (1) Participating securities include nonvested shares, certain time-based RSUs and vested market measure-based RSUs. Share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are considered participating securities. The impact of potentially dilutive common units, including stock options, RSUs and other securities are considered in our diluted earnings per share calculation for the three and six months ended June 30, 2016 and 2015 . Certain market measure-based RSUs are not included in dilutive securities for the three and six months ended June 30, 2016 and 2015 , as not all performance metrics had been met by the end of the applicable reporting periods. See Note 10 “Share-Based Compensation” for additional information regarding share-based compensation. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information of the Company | 6 Months Ended |
Jun. 30, 2016 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Information of the Company | Supplemental Cash Flow Information of the Company Supplemental cash flow information is included as follows (in thousands): Six Months Ended June 30, 2016 2015 SUPPLEMENTAL CASH FLOWS INFORMATION: Cash paid for interest, net of capitalized interest of $25,674 and $22,753 as of June 30, 2016 and 2015, respectively $ 25,787 $ 31,846 NONCASH INVESTING TRANSACTIONS: Accrual for expenditures for operating properties and development properties $ 50,246 $ 65,752 Tenant improvements funded directly by tenants $ 10,713 $ 13,036 Assumption of accrued liabilities in connection with acquisitions (Note 2) $ 4,911 $ 1,478 Release of holdback funds to third party $ — $ 9,279 NONCASH FINANCING TRANSACTIONS: Issuance of common units of the Operating Partnership in connection with an acquisition (Note 2) $ 48,033 $ — Accrual of dividends and distributions payable to common stockholders and common unitholders $ 36,093 $ 32,030 Accrual of dividends and distributions payable to preferred stockholders and preferred unitholders $ 1,656 $ 1,656 Secured debt assumed by buyers in connection with land dispositions (Note 3) $ 2,322 $ — Exchange of common units of the Operating Partnership into shares of the Company’s common stock $ 39 $ 316 |
Supplemental Cash Flow Inform29
Supplemental Cash Flow Information of the Operating Partnership | 6 Months Ended |
Jun. 30, 2016 | |
Other Significant Noncash Transactions [Line Items] | |
Supplemental Cash Flow Information of the Operating Partnership | Supplemental Cash Flow Information of the Company Supplemental cash flow information is included as follows (in thousands): Six Months Ended June 30, 2016 2015 SUPPLEMENTAL CASH FLOWS INFORMATION: Cash paid for interest, net of capitalized interest of $25,674 and $22,753 as of June 30, 2016 and 2015, respectively $ 25,787 $ 31,846 NONCASH INVESTING TRANSACTIONS: Accrual for expenditures for operating properties and development properties $ 50,246 $ 65,752 Tenant improvements funded directly by tenants $ 10,713 $ 13,036 Assumption of accrued liabilities in connection with acquisitions (Note 2) $ 4,911 $ 1,478 Release of holdback funds to third party $ — $ 9,279 NONCASH FINANCING TRANSACTIONS: Issuance of common units of the Operating Partnership in connection with an acquisition (Note 2) $ 48,033 $ — Accrual of dividends and distributions payable to common stockholders and common unitholders $ 36,093 $ 32,030 Accrual of dividends and distributions payable to preferred stockholders and preferred unitholders $ 1,656 $ 1,656 Secured debt assumed by buyers in connection with land dispositions (Note 3) $ 2,322 $ — Exchange of common units of the Operating Partnership into shares of the Company’s common stock $ 39 $ 316 |
Kilroy Realty, L.P. [Member] | |
Other Significant Noncash Transactions [Line Items] | |
Supplemental Cash Flow Information of the Operating Partnership | Supplemental Cash Flow Information of the Operating Partnership: Supplemental cash flow information is included as follows (in thousands): Six Months Ended June 30, 2016 2015 SUPPLEMENTAL CASH FLOWS INFORMATION: Cash paid for interest, net of capitalized interest of $25,674 and $22,753 as of June 30, 2016 and 2015, respectively $ 25,787 $ 31,846 NONCASH INVESTING TRANSACTIONS: Accrual for expenditures for operating properties and development properties $ 50,246 $ 65,752 Tenant improvements funded directly by tenants $ 10,713 $ 13,036 Assumption of accrued liabilities in connection with development acquisitions (Note 2) $ 4,911 $ 1,478 Release of holdback funds to third party $ — $ 9,279 NONCASH FINANCING TRANSACTIONS: Issuance of common units in connection with an acquisition (Note 2) $ 48,033 $ — Accrual of distributions payable to common unitholders $ 36,093 $ 32,030 Accrual of distributions payable to preferred unitholders $ 1,656 $ 1,656 Secured debt assumed by buyers in connection with land dispositions (Note 3) $ 2,322 $ — |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On July 13, 2016 , aggregate dividends, distributions and dividend equivalents of $36.1 million were paid to common stockholders and common unitholders of record on June 30, 2016 and RSU holders of record on the payment date. On July 20, 2016, $258.1 million of restricted cash was released from qualified intermediaries and used to repay the outstanding balance on our revolving credit facility as of June 30, 2016 . As a result, we had no outstanding borrowings on our unsecured revolving credit facility as of the date of this report. At June 30, 2016 , the Company had a portfolio of two properties and an undeveloped land parcel located in San Diego, California that were classified as held for sale. The Company completed the sale of these two properties and undeveloped land parcel for gross proceeds of $49.0 million on July 21, 2016. |
Organization and Basis of Pre31
Organization and Basis of Presentation (Policies) | 6 Months Ended |
Jun. 30, 2016 | |
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 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 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, 2016 . 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, 2015 . |
New accounting pronouncements | Adoption of New Accounting Pronouncements Variable Interest Entities Effective January 1, 2016, the Company adopted Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) No. 2015-02 (“ASU 2015-02”), which amended certain guidance with respect to the evaluation of Variable Interest Entities (“VIEs”) and when a reporting entity is required to consolidate certain legal entities. Specifically, the amendments: (i) modify the evaluation of whether limited partnerships and similar legal entities are VIEs or voting interest entities, (ii) eliminate the presumption that a general partner should consolidate a limited partnership, (iii) affect the consolidation analysis of reporting entities that are involved with VIEs, and (iv) provide a scope exception for certain entities. Under the new guidance, effective January 1, 2016 the Operating Partnership was determined to be a VIE of the Company as the Operating Partnership is a limited partnership in which the common limited partners do not have substantive kick-out rights or participating rights. However, given that the Company was deemed to be the primary beneficiary of the Operating Partnership, the adoption of this new guidance and the conclusion that the Operating Partnership was a VIE did not have any impact on our consolidated financial statements since the conclusion to consolidate the Operating Partnership still applied. The Operating Partnership was the only new VIE identified as part of the adoption of the guidance as of January 1, 2016. At June 30, 2016 , the consolidated financial statements of the Company included only one VIE, the Operating Partnership, and the consolidated financial statements of the Operating Partnership did not include any VIEs. At December 31, 2015 , the consolidated financial statements of the Company and the Operating Partnership included two VIEs in which we were deemed to be the primary beneficiary: Redwood LLC and one other VIE to facilitate potential future Section 1031 Exchanges to defer taxable gains on dispositions for federal income tax purposes. At December 31, 2015 , the impact of consolidating the VIEs increased the Company’s total assets, liabilities and noncontrolling interests by approximately $203.3 million (of which $187.3 million related to real estate held for investment on our consolidated balance sheet), approximately $28.8 million and approximately $6.5 million , respectively. During the three months ended June 30, 2016 , Redwood LLC had a VIE reconsideration event and was determined to no longer be a VIE and the VIE to facilitate potential future Section 1031 Exchanges was terminated. Reclassification of Debt Issuance Costs Effective January 1, 2016, the Company adopted FASB ASU No. 2015-03 and No. 2015-15, which requires that debt issuance costs related to a recognized debt liability be presented on the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. However, for line-of-credit arrangements, entities may defer and present debt issuance costs as an asset and amortize the costs ratably over the term of the line of credit arrangement, regardless of whether there are any outstanding borrowings on the line of credit arrangement. As a result of our adoption of the guidance, $1.1 million of deferred financing costs as of December 31, 2015 were reclassified to reduce secured debt, net and $12.0 million of deferred financing costs as of December 31, 2015 were reclassified to reduce unsecured debt, net in the December 31, 2015 balances on our consolidated balance sheets. In addition, $4.6 million of deferred financing costs relating to our unsecured line of credit as of December 31, 2015 were reclassified to prepaid expenses and other assets, net in the December 31, 2015 balances on our consolidated balance sheets. The guidance did not have a material impact on our consolidated financial statements. Recently Issued Accounting Pronouncements On June 16, 2016, the FASB issued ASU No. 2016-13 (“ASU 2016-13”) to amend the accounting for credit losses for certain financial instruments. Under the new guidance, an entity recognizes its estimate of expected credit losses as an allowance, which the FASB believes will result in more timely recognition of such losses. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company is currently assessing the impact of the guidance on our consolidated financial statements and notes to our consolidated financial statements. On May 9, 2016, the FASB issued ASU No. 2016-12, which clarifies and provides practical expedients for certain aspects of ASU No. 2014-09, which outlines a single comprehensive model for entities to use in accounting for revenues arising from contracts with customers and notes that lease contracts with customers are a scope exception. Public business entities may elect to adopt the amendments as of the original effective date; however, adoption is required for annual reporting periods beginning after December 15, 2017. The Company is currently assessing the impact of the guidance on our consolidated financial statements and notes to our consolidated financial statements. On March 30, 2016, the FASB issued ASU No. 2016-09 (“ASU 2016-09”) to amend the accounting guidance for share-based payment accounting. The areas for simplification in ASU 2016-09 involve several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. ASU 2016-09 is effective for annual periods beginning after December 15, 2016 and interim periods within those annual periods and early adoption is permitted. The Company is currently assessing the impact of the guidance on our consolidated financial statements and notes to our consolidated financial statements. On February 25, 2016, the FASB issued ASU No. 2016-02 (“ASU 2016-02”) to amend the accounting guidance for leases. The accounting applied by a lessor is largely unchanged under ASU 2016-02. However, the standard requires lessees to recognize lease assets and lease liabilities for leases classified as operating leases on the balance sheet. Lessees will recognize in the statement of financial position a liability to make lease payments and a right-of-use asset representing its right to use the underlying asset for the lease term. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. If a lessee makes this election, it will recognize lease expense for such leases generally on a straight-line basis over the lease term. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018 and early adoption is permitted. The Company is currently assessing the impact of the guidance on our consolidated financial statements and notes to our consolidated financial statements. On January 5, 2016, the FASB issued ASU No. 2016-01 (“ASU 2016-01”) to amend the accounting guidance on the classification and measurement of financial instruments. The standard requires that all investments in equity securities, including other ownership interests, are carried at fair value through net income. This requirement does not apply to investments that qualify for equity method accounting or to those that result in consolidation of the investee or for which the entity has elected the predictability exception to fair value measurement. Additionally, the standard requires that the portion of the total fair value change caused by a change in instrument-specific credit risk for financial liabilities for which the fair value option has been elected would be recognized in other comprehensive income. Any accumulated amount remaining in other comprehensive income is reclassified to earnings when the liability is extinguished. ASU 2016-01 is effective for fiscal years beginning after December 15, 2017. The Company does not anticipate the guidance to have a material impact on our consolidated financial statements or notes to our consolidated financial statements. |
Organization and Basis of Pre32
Organization and Basis of Presentation (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of real estate properties | As of June 30, 2016 , the following properties, in addition to our recently completed residential property, were excluded from our stabilized office portfolio. We did not have any redevelopment properties at June 30, 2016. Number of Properties/Projects Estimated Rentable Square Feet (1) Properties held for sale (2) 2 136,908 Development projects in “ lease-up ” 2 443,000 Development projects under construction 1 700,000 ________________________ (1) Estimated rentable square feet upon completion. (2) These properties include two operating properties totaling 136,908 rentable square feet and a 7.0 acre undeveloped land parcel. See Note 3 “Dispositions and Real Estate Assets Held for Sale” for additional information. Our stabilized portfolio of operating properties was comprised of the following office properties at June 30, 2016 : Number of Buildings Rentable Square Feet Number of Tenants Percentage Occupied Stabilized Office Properties 102 13,660,231 526 95.5 % |
Acquisitions Acquisitions (Tabl
Acquisitions Acquisitions (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Business Combinations [Abstract] | |
Schedule of Acquisitions | During the six months ended June 30, 2016 , we acquired the one operating property listed below from an unrelated third party. The acquisition was funded with proceeds from the Company’s unsecured revolving credit facility as well as proceeds from our capital recycling program. Property Date of Acquisition Number of Buildings Rentable Square Feet (unaudited) Purchase Price (in millions) (1) 1290-1300 Terra Bella Avenue, Mountain View, CA June 8, 2016 1 114,175 $ 55.4 ________________________ (1) In connection with this acquisition, we assumed $0.2 million in accrued liabilities that are not included in the purchase price above. |
Schedule of estimated fair values of the assets acquired and liabilities assumed | The following table summarizes the estimated fair values of the assets acquired and liabilities assumed as of the date of acquisition: Total 2016 Operating Property Acquisitions (1) Assets Land and improvements $ 28,730 Buildings and improvements (2) 27,555 Deferred leasing costs and acquisition-related intangible assets (3) 4,180 Total assets acquired 60,465 Liabilities Accounts payable, accrued expenses and other liabilities 170 Deferred revenue and acquisition-related intangible liabilities (4) 4,880 Total liabilities assumed 5,050 Net assets and liabilities acquired $ 55,415 ________________________ (1) The purchase price of the acquisition completed during the six months ended June 30, 2016 was less than 5% of the Company’s total assets as of June 30, 2016. (2) Represents buildings, building improvements and tenant improvements. (3) Represents in-place leases (approximately $2.5 million with a weighted average amortization period of 3.6 years) and leasing commissions (approximately $1.7 million with a weighted average amortization period of 3.7 years). (4) Represents below-market leases (approximately $4.9 million with a weighted average amortization period of 3.4 years). |
Dispositions (Tables)
Dispositions (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of dispositions and real estate assets held for sale | The following table summarizes the land dispositions completed during the six months ended June 30, 2016 : Property Submarket Month of Disposition Gross Site Acreage (unaudited) Sales Price (1) (in millions) Carlsbad Oaks - Lot 7 (2) Carlsbad January 7.6 $ 4.5 Carlsbad Oaks - Lots 4 & 5 Carlsbad June 11.2 6.0 Carlsbad Oaks - Lot 8 Carlsbad June 13.2 8.9 Total Land Dispositions (3) 32.0 $ 19.4 ________________________ (1) Represents gross sales price before the impact of broker commissions and closing costs. (2) This land parcel was classified as held for sale as of December 31, 2015. (3) In connection with these land dispositions, $2.3 million of secured debt was assumed by the buyers. See Note 6 “Secured and Unsecured Debt of the Operating Partnership” for additional information. The major classes of assets and liabilities of the properties held for sale as of June 30, 2016 were as follows: Real estate assets and other assets held for sale (in thousands) Land and improvements $ 5,377 Buildings and improvements 34,246 Undeveloped land 12,355 Total real estate held for sale 51,978 Accumulated depreciation and amortization (22,400 ) Total real estate held for sale, net 29,578 Deferred rent receivables, net 467 Deferred leasing costs and acquisition-related intangible assets, net 57 Prepaid expenses and other assets, net 155 Real estate and other assets held for sale, net $ 30,257 Liabilities and deferred revenue of real estate assets held for sale Accounts payable, accrued expenses and other liabilities $ 120 Deferred revenue and acquisition-related intangible liabilities, net 201 Liabilities and deferred revenue of real estate assets held for sale $ 321 The following table summarizes the operating properties sold during the six months ended June 30, 2016 . Location Property Type Month of Disposition Number of Buildings Rentable Square Feet Sales Price (1) (in millions) Torrey Santa Fe Properties (2) Office January 4 465,812 $ 262.3 ________________________ (1) Represents gross sales price before the impact of broker commissions and closing costs. (2) The Torrey Santa Fe Properties include the following: 7525 Torrey Santa Fe, 7535 Torrey Santa Fe, 7545 Torrey Santa Fe, and 7555 Torrey Santa Fe. These properties were classified as held for sale at December 31, 2015 . As of June 30, 2016 , the following properties were classified as held for sale: Location Submarket Property Type Number of Buildings Rentable Square Feet 4930, 4939 & 4955 Directors Place (1) Sorrento Mesa Office 2 136,908 ________________________ (1) These properties include two operating properties totaling 136,908 rentable square feet and a 7.0 acre undeveloped land parcel. On July 21, 2016, the Company completed the sale of these properties for a gross sales price of $49.0 million . |
Deferred Leasing Costs and Ac35
Deferred Leasing Costs and Acquisition-related Intangible Assets and Liabilities, net (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Intangible Assets and Liabilities Disclosure [Abstract] | |
Schedules of 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 June 30, 2016 and December 31, 2015 : June 30, 2016 December 31, 2015 (in thousands) Deferred Leasing Costs and Acquisition-Related Intangible Assets, net: (1) Deferred leasing costs $ 228,701 $ 205,888 Accumulated amortization (81,460 ) (72,745 ) Deferred leasing costs, net 147,241 133,143 Above-market operating leases 10,662 10,989 Accumulated amortization (7,188 ) (6,739 ) Above-market operating leases, net 3,474 4,250 In-place leases 72,944 72,639 Accumulated amortization (37,212 ) (33,810 ) In-place leases, net 35,732 38,829 Below-market ground lease obligation 490 490 Accumulated amortization (34 ) (29 ) Below-market ground lease obligation, net 456 461 Total deferred leasing costs and acquisition-related intangible assets, net $ 186,903 $ 176,683 Acquisition-Related Intangible Liabilities, net: (2) (3) Below-market operating leases $ 57,166 $ 53,502 Accumulated amortization (29,899 ) (27,074 ) Below-market operating leases, net 27,267 26,428 Above-market ground lease obligation 6,320 6,320 Accumulated amortization (475 ) (424 ) Above-market ground lease obligation, net 5,845 5,896 Total acquisition-related intangible liabilities, net $ 33,112 $ 32,324 ________________________ (1) Excludes deferred leasing costs and acquisition-related intangible assets, net related to properties held for sale. (2) Excludes acquisition-related intangible liabilities, net related to properties held for sale. (3) 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 for the three and six months ended June 30, 2016 and 2015 : Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 (in thousands) Deferred leasing costs (1) $ 6,961 $ 7,093 $ 13,744 $ 13,914 Above-market operating leases (2) 384 737 776 1,648 In-place leases (1) 2,669 4,416 5,557 8,637 Below-market ground lease obligation (3) 2 2 4 4 Below-market operating leases (4) (2,024 ) (3,838 ) (4,019 ) (6,677 ) Above-market ground lease obligation (5) (25 ) (25 ) (50 ) (50 ) Total $ 7,967 $ 8,385 $ 16,012 $ 17,476 ________________________ (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 June 30, 2016 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 2016 $ 14,251 $ 725 $ 5,466 $ 4 $ (4,494 ) $ (50 ) 2017 26,180 1,241 9,738 8 (8,437 ) (101 ) 2018 22,883 831 6,998 8 (7,159 ) (101 ) 2019 18,748 643 5,149 8 (4,583 ) (101 ) 2020 14,495 16 2,923 8 (2,169 ) (101 ) Thereafter 50,684 18 5,458 420 (425 ) (5,391 ) Total $ 147,241 $ 3,474 $ 35,732 $ 456 $ (27,267 ) $ (5,845 ) ________________________ (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) | 6 Months Ended |
Jun. 30, 2016 | |
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 June 30, 2016 and December 31, 2015 : June 30, 2016 December 31, 2015 (in thousands) Current receivables $ 11,930 $ 13,233 Allowance for uncollectible tenant receivables (1,818 ) (2,080 ) Current receivables, net (1) $ 10,112 $ 11,153 ________________________ (1) Excludes current receivables, net related to real estate held for sale. |
Deferred Rent Receivables, net | Deferred rent receivables, net consisted of the following as of June 30, 2016 and December 31, 2015 : June 30, 2016 December 31, 2015 (in thousands) Deferred rent receivables $ 209,378 $ 191,586 Allowance for deferred rent receivables (1,527 ) (1,882 ) Deferred rent receivables, net (1) $ 207,851 $ 189,704 ________________________ (1) Excludes deferred rent receivables related to real estate held for sale. |
Secured and Unsecured Debt of37
Secured and Unsecured Debt of the Operating Partnership (Tables) - Kilroy Realty, L.P. [Member] | 6 Months Ended |
Jun. 30, 2016 | |
Debt Instrument [Line Items] | |
Unsecured Revolving Credit Facility | The following table summarizes the balance and terms of our unsecured revolving credit facility as of June 30, 2016 and December 31, 2015 : June 30, 2016 December 31, 2015 (in thousands) Outstanding borrowings (1) $ 220,000 $ — Remaining borrowing capacity 380,000 600,000 Total borrowing capacity (2) $ 600,000 $ 600,000 Interest rate (3) 1.52 % 1.40 % Facility fee-annual rate (4) 0.200% Maturity date July 2019 ________________________ (1) On July 20, 2016, we repaid the total outstanding borrowings on our unsecured revolving credit facility. Refer to Note 17 “Subsequent Events” for additional information. (2) We may elect to borrow, subject to bank approval and obtaining commitments for any additional borrowing capacity, up to an additional $311.0 million under an accordion feature under the terms of the unsecured revolving credit facility and term loan facility. (3) Our unsecured revolving credit facility interest rate was calculated based on an annual rate of LIBOR plus 1.050% as of June 30, 2016 and December 31, 2015 . (4) Our facility fee is paid on a quarterly basis and is calculated based on the total borrowing capacity. In addition to the facility fee, we incurred debt origination and legal costs. As of June 30, 2016 and December 31, 2015 , $3.9 million and $4.6 million , of unamortized deferred financing costs, respectively, remained to be amortized through the maturity date of our unsecured revolving credit facility, which are included in prepaid expenses and other assets, net on our consolidated balance sheets. The following table summarizes the balance and terms of our unsecured term loan facility as of June 30, 2016 and December 31, 2015 : June 30, 2016 December 31, 2015 (in thousands) Outstanding borrowings (1) $ 150,000 $ 150,000 Interest rate (2) 1.62 % 1.40 % Maturity date July 2019 ________________________ (1) As of June 30, 2016 and December 31, 2015 , $0.8 million and $0.9 million of unamortized deferred financing costs, respectively, remained to be amortized through the maturity date of our unsecured term loan facility. (2) Our unsecured term loan facility interest rate was calculated based on an annual rate of LIBOR plus 1.150% as of June 30, 2016 and December 31, 2015 . |
Schedule of Debt Maturities | The following table summarizes the stated debt maturities and scheduled amortization payments, excluding unamortized debt discounts, premiums and deferred financing costs, as of June 30, 2016 : Year (in thousands) Remaining 2016 $ 4,926 2017 71,692 2018 451,669 2019 485,309 2020 251,913 Thereafter 1,187,589 Total (1) $ 2,453,098 ________________________ (1) Includes gross principal balance of outstanding debt before the effect of the following at June 30, 2016 : $11.9 million of unamortized deferred financing costs, $7.0 million of unamortized discounts for the unsecured senior notes and $5.3 million of unamortized premiums for the secured debt. |
Capitalized interest and loan fees | The following table sets forth gross interest expense, including debt discount/premium and deferred financing cost amortization, net of capitalized interest, for the three and six months ended June 30, 2016 and 2015 . The interest expense capitalized was recorded as a cost of development and increased the carrying value of undeveloped land and construction in progress. Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 (in thousands) Gross interest expense $ 26,668 $ 27,187 $ 52,843 $ 54,936 Capitalized interest and deferred financing costs (12,284 ) (12,323 ) (26,630 ) (23,194 ) Interest expense $ 14,384 $ 14,864 $ 26,213 $ 31,742 |
Secured Debt [Member] | |
Debt Instrument [Line Items] | |
Schedule of Debt | The following table sets forth the composition of our secured debt as of June 30, 2016 and December 31, 2015 : Type of Debt Annual Stated Interest Rate (1) Effective Interest Rate (1)(2) Maturity Date June 30, 2016 December 31, 2015 (in thousands) Mortgage note payable (4) 4.27% 4.27% February 2018 $ 127,049 $ 128,315 Mortgage note payable (4) 4.48% 4.48% July 2027 95,563 96,354 Mortgage note payable (3) (4) 6.05% 3.50% June 2019 84,179 85,890 Mortgage note payable 6.51% 6.51% February 2017 64,994 65,563 Mortgage note payable 7.15% 7.15% May 2017 2,625 3,987 Other (5) Various Various Various — 1,809 Total secured debt $ 374,410 $ 381,918 Unamortized deferred financing costs (910 ) (1,083 ) Total secured debt, net $ 373,500 $ 380,835 ________________________ (1) All interest rates presented are fixed-rate interest rates. (2) Represents the effective interest rate including the amortization of initial issuance discounts/premiums excluding the amortization of deferred financing costs. (3) Amounts reported include the amounts of unamortized debt premiums of $5.3 million and $6.2 million as of June 30, 2016 and December 31, 2015 , respectively. (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) Balance of $1.8 million as of December 31, 2015 included public facility bonds that were assumed by the buyers in connection with sales of land during the six months ended June 30, 2016 . |
Unsecured Senior Notes [Member] | |
Debt Instrument [Line Items] | |
Schedule of Debt | The following table summarizes the balance and significant terms of the registered unsecured senior notes issued by the Operating Partnership as of June 30, 2016 and December 31, 2015 : Principal Amount as of Issuance date Maturity date Stated coupon rate Effective interest rate (1) June 30, December 31, 2015 (in thousands) 4.375% Unsecured Senior Notes (2) September 2015 October 2025 4.375% 4.440% $ 400,000 $ 400,000 Unamortized discount and deferred financing costs (5,123 ) (5,400 ) Net carrying amount $ 394,877 $ 394,600 4.250% Unsecured Senior Notes (3) July 2014 August 2029 4.250% 4.350% $ 400,000 $ 400,000 Unamortized discount and deferred financing costs (6,962 ) (7,228 ) Net carrying amount $ 393,038 $ 392,772 3.800% Unsecured Senior Notes (4) January 2013 January 2023 3.800% 3.804% $ 300,000 $ 300,000 Unamortized discount and deferred financing costs (1,794 ) (1,931 ) Net carrying amount $ 298,206 $ 298,069 4.800% Unsecured Senior Notes (4) (5) July 2011 July 2018 4.800% 4.827% $ 325,000 $ 325,000 Unamortized discount and deferred financing costs (1,009 ) (1,251 ) Net carrying amount $ 323,991 $ 323,749 6.625% Unsecured Senior Notes (6) May 2010 June 2020 6.625% 6.743% $ 250,000 $ 250,000 Unamortized discount and deferred financing costs (2,142 ) (2,414 ) Net carrying amount $ 247,858 $ 247,586 Total Unsecured Senior Notes, Net $ 1,657,970 $ 1,656,776 ________________________ (1) Represents the effective interest rate including the amortization of initial issuance discounts/premiums excluding the amortization of deferred financing costs. (2) Interest on these notes is payable semi-annually in arrears on April 1st and October 1st of each year. (3) Interest on these notes is payable semi-annually in arrears on February 15th and August 15th of each year. (4) Interest on these notes is payable semi-annually in arrears on January 15th and July 15th of each year. (5) In October 2015, certain common limited partners in the Operating Partnership that previously contributed their interests in the property at 6255 W. Sunset Blvd., Los Angeles, California to the Operating Partnership entered into an agreement with the Company. Pursuant to this agreement, such common limited partners will reimburse the Company for a portion of any amounts the Company may be required to pay pursuant to its guarantee of the Operating Partnership’s 4.800% Senior Notes due 2018 or that the Company may otherwise become required to pay under applicable law with respect to such notes. (6) Interest on these notes is payable semi-annually in arrears on June 1st and December 1st of each year. |
Partners_ Capital of the Operat
Partners’ Capital of the Operating Partnership (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Partners' Capital Notes [Abstract] | |
Schedule of 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-affiliated 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: June 30, 2016 December 31, 2015 June 30, 2015 Company owned common units in the Operating Partnership 92,254,768 92,258,690 88,405,632 Company owned general partnership interest 97.2 % 98.1 % 98.0 % Noncontrolling common units of the Operating Partnership 2,631,276 1,764,775 1,793,170 Ownership interest of noncontrolling interest 2.8 % 1.9 % 2.0 % |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of share-based payment award, restricted stock units, valuation assumptions | The following table summarizes the assumptions utilized in the Monte Carlo simulation pricing model: Fair Value Assumptions Fair value per share at January 28, 2016 $57.08 Expected share price volatility 26.00% Risk-free interest rate 1.13% Remaining expected life 2.9 years |
Fair Value Measurements and D40
Fair Value Measurements and Disclosures (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
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 June 30, 2016 and December 31, 2015 : Fair Value (Level 1) (1) June 30, 2016 December 31, 2015 Description (in thousands) Marketable securities (2) $ 13,388 $ 12,882 ________________________ (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 six months ended June 30, 2016 and 2015 : Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Description (in thousands) (in thousands) Net gain on marketable securities $ 249 $ 122 $ 386 $ 510 |
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 June 30, 2016 and December 31, 2015 : June 30, 2016 December 31, 2015 Carrying Fair (1) Carrying Fair (1) (in thousands) Liabilities Secured debt, net $ 373,500 $ 387,976 $ 380,835 $ 391,611 Unsecured debt, net 1,845,992 1,987,469 1,844,634 1,898,863 Unsecured line of credit 220,000 220,442 — — ________________________ (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. |
Net Income Available to Commo41
Net Income Available to Common Stockholders Per Share of the Company (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
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 available to common stockholders for the three and six months ended June 30, 2016 and 2015 : Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 (in thousands, except share and per share amounts) Numerator: Net income attributable to Kilroy Realty Corporation $ 32,847 $ 57,500 $ 207,155 $ 100,687 Preferred dividends (3,312 ) (3,312 ) (6,625 ) (6,625 ) Allocation to participating securities (1) (423 ) (418 ) (818 ) (833 ) Numerator for basic and diluted net income available to common stockholders $ 29,112 $ 53,770 $ 199,712 $ 93,229 Denominator: Basic weighted average vested shares outstanding 92,209,955 88,126,187 92,217,238 87,514,878 Effect of dilutive securities 614,831 519,681 566,827 529,414 Diluted weighted average vested shares and common share equivalents outstanding 92,824,786 88,645,868 92,784,065 88,044,292 Basic earnings per share: Net income available to common stockholders per share $ 0.32 $ 0.61 $ 2.17 $ 1.07 Diluted earnings per share: Net income available to common stockholders per share $ 0.31 $ 0.61 $ 2.15 $ 1.06 ________________________ (1) Participating securities include nonvested shares, certain time-based RSUs and vested market measure-based RSUs. |
Net Income Available to Commo42
Net Income Available to Common Unitholders Per Unit of the Operating Partnership (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Net Income Available To Common Unitholders [Line Items] | |
Net income (loss) 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 available to common stockholders for the three and six months ended June 30, 2016 and 2015 : Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 (in thousands, except share and per share amounts) Numerator: Net income attributable to Kilroy Realty Corporation $ 32,847 $ 57,500 $ 207,155 $ 100,687 Preferred dividends (3,312 ) (3,312 ) (6,625 ) (6,625 ) Allocation to participating securities (1) (423 ) (418 ) (818 ) (833 ) Numerator for basic and diluted net income available to common stockholders $ 29,112 $ 53,770 $ 199,712 $ 93,229 Denominator: Basic weighted average vested shares outstanding 92,209,955 88,126,187 92,217,238 87,514,878 Effect of dilutive securities 614,831 519,681 566,827 529,414 Diluted weighted average vested shares and common share equivalents outstanding 92,824,786 88,645,868 92,784,065 88,044,292 Basic earnings per share: Net income available to common stockholders per share $ 0.32 $ 0.61 $ 2.17 $ 1.07 Diluted earnings per share: Net income available to common stockholders per share $ 0.31 $ 0.61 $ 2.15 $ 1.06 ________________________ (1) Participating securities include nonvested shares, certain time-based RSUs and vested market measure-based RSUs. |
Kilroy Realty, L.P. [Member] | |
Net Income Available To Common Unitholders [Line Items] | |
Net income (loss) 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 available to common unitholders for the three and six months ended June 30, 2016 and 2015 : Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 (in thousands, except unit and per unit amounts) Numerator: Net income attributable to Kilroy Realty, L.P. $ 33,590 $ 58,518 $ 211,423 $ 102,445 Preferred distributions (3,312 ) (3,312 ) (6,625 ) (6,625 ) Allocation to participating securities (1) (423 ) (418 ) (818 ) (833 ) Numerator for basic and diluted net income available to common unitholders $ 29,855 $ 54,788 $ 203,980 $ 94,987 Denominator: Basic weighted average vested units outstanding 94,841,231 89,919,357 94,514,876 89,309,718 Effect of dilutive securities 614,831 519,681 566,827 529,414 Diluted weighted average vested units and common unit equivalents outstanding 95,456,062 90,439,038 95,081,703 89,839,132 Basic earnings per unit: Net income available to common unitholders per unit $ 0.31 $ 0.61 $ 2.16 $ 1.06 Diluted earnings per unit: Net income available to common unitholders per unit $ 0.31 $ 0.61 $ 2.15 $ 1.06 ________________________ (1) Participating securities include nonvested shares, certain time-based RSUs and vested market measure-based RSUs. |
Supplemental Cash Flow Inform43
Supplemental Cash Flow Information of the Company (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of Supplemental Cash Flows | Supplemental cash flow information is included as follows (in thousands): Six Months Ended June 30, 2016 2015 SUPPLEMENTAL CASH FLOWS INFORMATION: Cash paid for interest, net of capitalized interest of $25,674 and $22,753 as of June 30, 2016 and 2015, respectively $ 25,787 $ 31,846 NONCASH INVESTING TRANSACTIONS: Accrual for expenditures for operating properties and development properties $ 50,246 $ 65,752 Tenant improvements funded directly by tenants $ 10,713 $ 13,036 Assumption of accrued liabilities in connection with acquisitions (Note 2) $ 4,911 $ 1,478 Release of holdback funds to third party $ — $ 9,279 NONCASH FINANCING TRANSACTIONS: Issuance of common units of the Operating Partnership in connection with an acquisition (Note 2) $ 48,033 $ — Accrual of dividends and distributions payable to common stockholders and common unitholders $ 36,093 $ 32,030 Accrual of dividends and distributions payable to preferred stockholders and preferred unitholders $ 1,656 $ 1,656 Secured debt assumed by buyers in connection with land dispositions (Note 3) $ 2,322 $ — Exchange of common units of the Operating Partnership into shares of the Company’s common stock $ 39 $ 316 |
Supplemental Cash Flow Inform44
Supplemental Cash Flow Information of the Operating Partnership (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Other Significant Noncash Transactions [Line Items] | |
Schedule of Supplemental Cash Flows | Supplemental cash flow information is included as follows (in thousands): Six Months Ended June 30, 2016 2015 SUPPLEMENTAL CASH FLOWS INFORMATION: Cash paid for interest, net of capitalized interest of $25,674 and $22,753 as of June 30, 2016 and 2015, respectively $ 25,787 $ 31,846 NONCASH INVESTING TRANSACTIONS: Accrual for expenditures for operating properties and development properties $ 50,246 $ 65,752 Tenant improvements funded directly by tenants $ 10,713 $ 13,036 Assumption of accrued liabilities in connection with acquisitions (Note 2) $ 4,911 $ 1,478 Release of holdback funds to third party $ — $ 9,279 NONCASH FINANCING TRANSACTIONS: Issuance of common units of the Operating Partnership in connection with an acquisition (Note 2) $ 48,033 $ — Accrual of dividends and distributions payable to common stockholders and common unitholders $ 36,093 $ 32,030 Accrual of dividends and distributions payable to preferred stockholders and preferred unitholders $ 1,656 $ 1,656 Secured debt assumed by buyers in connection with land dispositions (Note 3) $ 2,322 $ — Exchange of common units of the Operating Partnership into shares of the Company’s common stock $ 39 $ 316 |
Kilroy Realty, L.P. [Member] | |
Other Significant Noncash Transactions [Line Items] | |
Schedule of Supplemental Cash Flows | Supplemental cash flow information is included as follows (in thousands): Six Months Ended June 30, 2016 2015 SUPPLEMENTAL CASH FLOWS INFORMATION: Cash paid for interest, net of capitalized interest of $25,674 and $22,753 as of June 30, 2016 and 2015, respectively $ 25,787 $ 31,846 NONCASH INVESTING TRANSACTIONS: Accrual for expenditures for operating properties and development properties $ 50,246 $ 65,752 Tenant improvements funded directly by tenants $ 10,713 $ 13,036 Assumption of accrued liabilities in connection with development acquisitions (Note 2) $ 4,911 $ 1,478 Release of holdback funds to third party $ — $ 9,279 NONCASH FINANCING TRANSACTIONS: Issuance of common units in connection with an acquisition (Note 2) $ 48,033 $ — Accrual of distributions payable to common unitholders $ 36,093 $ 32,030 Accrual of distributions payable to preferred unitholders $ 1,656 $ 1,656 Secured debt assumed by buyers in connection with land dispositions (Note 3) $ 2,322 $ — |
Organization and Basis of Pre45
Organization and Basis of Presentation (Details) - Jun. 30, 2016 | Total | ft² | project | tenant | building | a | property | |
Real Estate Properties [Line Items] | ||||||||
Number of buildings | building | 1 | |||||||
Rentable Square Feet | 114,175 | |||||||
Area of land | a | 32 | |||||||
Stabilized office properties [Member] | ||||||||
Real Estate Properties [Line Items] | ||||||||
Number of buildings | 8 | 102 | ||||||
Rentable Square Feet | 13,660,231 | |||||||
Number of Tenants | tenant | 526 | |||||||
Percentage Occupied | 95.50% | |||||||
Area of land | a | 70 | |||||||
Properties held for Sale [Member] | ||||||||
Real Estate Properties [Line Items] | ||||||||
Number of buildings | property | [1] | 2 | ||||||
Rentable Square Feet | [1] | 136,908 | ||||||
Area of land | a | 7 | |||||||
Development projects in lease-up [Member] | ||||||||
Real Estate Properties [Line Items] | ||||||||
Number of buildings | project | 2 | |||||||
Rentable Square Feet | [2] | 443,000 | ||||||
Development projects under construction [Member] | ||||||||
Real Estate Properties [Line Items] | ||||||||
Number of buildings | project | 1 | |||||||
Rentable Square Feet | [2] | 700,000 | ||||||
[1] | These properties include two operating properties totaling 136,908 rentable square feet and a 7.0 acre undeveloped land parcel. On July 21, 2016, the Company completed the sale of these properties for a gross sales price of $49.0 million. | |||||||
[2] | Estimated rentable square feet upon completion. |
Organization and Basis of Pre46
Organization and Basis of Presentation (Details Textuals) $ in Thousands | 6 Months Ended | |||||||||
Jun. 30, 2016 | Jun. 30, 2016USD ($) | Jun. 30, 2016ft² | Jun. 30, 2016project | Jun. 30, 2016building | Jun. 30, 2016a | Jun. 30, 2016property | Dec. 31, 2015USD ($)variable_interest_entity | Jun. 30, 2015 | ||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||||||
Number of buildings | building | 1 | |||||||||
Rentable Square Feet | ft² | 114,175 | |||||||||
Lease-up properties occupancy percentage | 95.00% | |||||||||
Area of land | a | 32 | |||||||||
Common general partnership interest in the Operating Partnership (percentage) | 97.20% | 98.10% | 98.00% | |||||||
Common limited partnership interest in the Operating Partnership (percentage) | 2.80% | 1.90% | 2.00% | |||||||
VIE assets | $ 203,300 | |||||||||
VIE liabilities | 28,800 | |||||||||
Noncontrolling interest in VIE | $ 6,650 | $ 6,520 | ||||||||
Number of VIEs | variable_interest_entity | 2 | |||||||||
Kilroy Realty Finance, Inc. [Member] | ||||||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||||||
Common general partnership interest in the Finance Partnership (percentage) | 1.00% | |||||||||
Kilroy Realty, L.P. [Member] | ||||||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||||||
Percentage of limited partnership interest owned by Operating Partnership | 99.00% | |||||||||
Redwood LLC [Member] | ||||||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||||||
Common general partnership interest in the Operating Partnership (percentage) | 93.00% | |||||||||
Office properties [Member] | ||||||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||||||
Number of buildings | 8 | 102 | ||||||||
Rentable Square Feet | ft² | 13,660,231 | |||||||||
Area of land | a | 70 | |||||||||
Office properties [Member] | Washington [Member] | ||||||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||||||
Number of buildings | property | 12 | |||||||||
Lease up properties [Member] | ||||||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||||||
Number of buildings | project | 2 | |||||||||
Rentable Square Feet | ft² | [1] | 443,000 | ||||||||
Development properties [Member] | ||||||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||||||
Number of buildings | project | 1 | |||||||||
Rentable Square Feet | ft² | [1] | 700,000 | ||||||||
Development properties [Member] | San Francisco, California [Member] | ||||||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||||||
Number of buildings | building | 2 | |||||||||
Development properties [Member] | Washington [Member] | ||||||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||||||
Number of buildings | property | 1 | |||||||||
Properties and development projects [Member] | ||||||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||||||
Property ownership percentage | 100.00% | |||||||||
Development project one [Member] | Development properties [Member] | San Francisco, California [Member] | ||||||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||||||
Rentable Square Feet | ft² | 455,340 | |||||||||
Development project two [Member] | Development properties [Member] | San Francisco, California [Member] | ||||||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||||||
Rentable Square Feet | ft² | 185,602 | |||||||||
Real estate held-for-investment [Member] | ||||||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||||||
VIE assets | $ 187,300 | |||||||||
Accounting Standards Update 2015-03 and 2015-15 [Member] | Secured debt, net [Member] | ||||||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||||||
Deferred financing costs | 1,100 | |||||||||
Accounting Standards Update 2015-03 and 2015-15 [Member] | Unsecured debt, Net [Member] | ||||||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||||||
Deferred financing costs | 12,000 | |||||||||
Accounting Standards Update 2015-03 and 2015-15 [Member] | Prepaid expenses and other current assets [Member] | ||||||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||||||
Debt issuance costs, line of credit arrangements, net | $ 4,600 | |||||||||
[1] | Estimated rentable square feet upon completion. |
Acquisitions (Details)
Acquisitions (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2016shares | Jun. 30, 2016USD ($)ft²abuilding | Jun. 30, 2016USD ($)ft²abuildingshares | Mar. 11, 2016USD ($)a | ||
Business Acquisition [Line Items] | |||||
Number of Buildings | building | 1 | 1 | |||
Rentable Square Feet | ft² | 114,175 | 114,175 | |||
Purchase Price (in millions) (1) | [1] | $ 55,400 | |||
Business combination, recognized identifiable assets acquired and liabilities assumed, current liabilities, accounts payable | [1] | $ 170 | 170 | ||
Land and improvements | [1] | 28,730 | 28,730 | ||
Buildings and improvements (2) | [1],[2] | 27,555 | 27,555 | ||
Deferred leasing costs and acquisition-related intangible assets (3) | [1],[3] | 4,180 | 4,180 | ||
Total assets acquired | [1] | 60,465 | 60,465 | ||
Deferred revenue and acquisition-related intangible liabilities (4) | [1],[4] | 4,880 | 4,880 | ||
Total liabilities assumed | [1] | 5,050 | 5,050 | ||
Net assets and liabilities acquired | [1] | $ 55,415 | 55,415 | ||
Below market lease, acquired | $ 4,900 | ||||
Acquired finite lived intangible liabilities weighted average useful life | 3 years 4 months 34 days | ||||
Area of land | a | 32 | 32 | |||
Brannan St Project [Member] | |||||
Business Acquisition [Line Items] | |||||
Total liabilities assumed | $ 4,700 | ||||
Area of land | a | 1.75 | ||||
Cash payment | $ 31,000 | ||||
Common units issued | shares | 867,701 | 867,701 | |||
Value of common units issued | 48,000 | $ 48,000 | |||
Transaction costs | $ 2,400 | ||||
In-place leases [Member] | |||||
Business Acquisition [Line Items] | |||||
Deferred leasing costs and acquisition-related intangible assets (3) | 2,500 | $ 2,500 | |||
Acquired finite-lived intangible assets, weighted average useful life | 3 years 7 months 6 days | ||||
Deferred leasing costs and acquisition-related intangible assets, net [Member] | |||||
Business Acquisition [Line Items] | |||||
Deferred leasing costs and acquisition-related intangible assets (3) | $ 1,700 | $ 1,700 | |||
Acquired finite-lived intangible assets, weighted average useful life | 3 years 8 months 12 days | ||||
[1] | In connection with this acquisition, we assumed $0.2 million in accrued liabilities that are not included in the purchase price above. | ||||
[2] | Represents buildings, building improvements and tenant improvements. | ||||
[3] | Represents in-place leases (approximately $2.5 million with a weighted average amortization period of 3.6 years) and leasing commissions (approximately $1.7 million with a weighted average amortization period of 3.7 years). | ||||
[4] | Represents below-market leases (approximately $4.9 million with a weighted average amortization period of 3.4 years). |
Dispositions (Details)
Dispositions (Details) $ in Thousands | Jul. 21, 2016USD ($)property | Jul. 20, 2016USD ($) | Jun. 30, 2016USD ($)ft²abuildingproperty | Jun. 30, 2015USD ($) | Jun. 30, 2016USD ($)ft²abuildingproperty | Jun. 30, 2015USD ($) | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Area of land sold | a | 32 | 32 | |||||
Dispositions sales price | [1],[2] | $ 19,400 | |||||
Secured debt assumed by buyer in connection with land dispositions (Note 3) | 2,322 | $ 0 | |||||
Gain (loss) on sale of land | $ (295) | $ 0 | $ (295) | 17,268 | |||
Number of Buildings | building | 1 | 1 | |||||
Rentable Square Feet | ft² | 114,175 | 114,175 | |||||
Proceeds from sale of property held-for-sale | $ 258,100 | ||||||
Real estate held-for-sale | $ 30,257 | 30,257 | |||||
Land and improvements [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Real estate held-for-sale | 5,377 | 5,377 | |||||
Buildings and improvements [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Real estate held-for-sale | 34,246 | 34,246 | |||||
Undeveloped land [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Real estate held-for-sale | 12,355 | 12,355 | |||||
Total real estate held for sale [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Real estate held-for-sale | 51,978 | 51,978 | |||||
Accumulated depreciation and amortization [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Real estate held-for-sale | (22,400) | (22,400) | |||||
Total real estate held for sale, net [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Real estate held-for-sale | 29,578 | 29,578 | |||||
Deferred rent receivables, net [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Real estate held-for-sale | 467 | 467 | |||||
Deferred leasing costs and acquisition-related intangible assets, net [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Real estate held-for-sale | 57 | 57 | |||||
Prepaid expenses and other assets, net [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Real estate held-for-sale | 155 | 155 | |||||
Accounts payable, accrued expenses and other liabilities [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Real estate held-for-sale | 120 | 120 | |||||
Deferred revenue and acquisition-related intangible liabilities, net [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Real estate held-for-sale | 201 | 201 | |||||
Liabilities and deferred revenue of real estate assets held for sale [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Real estate held-for-sale | $ 321 | $ 321 | |||||
Properties held for Sale [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Area of land sold | a | 7 | 7 | |||||
Number of Buildings | property | [3] | 2 | 2 | ||||
Rentable Square Feet | ft² | [3] | 136,908 | 136,908 | ||||
Carlsbad Oaks - Lot 7 [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Area of land sold | a | 7.6 | 7.6 | |||||
Dispositions sales price | [2],[4] | $ 4,500 | |||||
Torrey Santa Fe Properties [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Gain (loss) on sale of land | $ 146,000 | ||||||
Number of Buildings | property | [5] | 4 | 4 | ||||
Rentable Square Feet | ft² | [5] | 465,812 | 465,812 | ||||
Sales Price (1) (in millions) | [5],[6] | $ 262,300 | |||||
Carlsbad Oaks - Lots 4 & 5 [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Area of land sold | a | 11.2 | 11.2 | |||||
Dispositions sales price | [2] | $ 6,000 | |||||
Carlsbad Oaks - Lot 8 [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Area of land sold | a | 13.2 | 13.2 | |||||
Dispositions sales price | [2] | $ 8,900 | |||||
Kilroy Realty, L.P. [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Secured debt assumed by buyer in connection with land dispositions (Note 3) | 2,322 | 0 | |||||
Gain (loss) on sale of land | $ (295) | $ 0 | $ (295) | $ 17,268 | |||
Subsequent event [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Sales Price (1) (in millions) | [5],[6] | $ 49,000 | |||||
Proceeds from sale of property held-for-sale | $ 258,100 | ||||||
Subsequent event [Member] | Properties held for Sale [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Number of Buildings | property | 2 | ||||||
[1] | In connection with these land dispositions, $2.3 million of secured debt was assumed by the buyers. See Note 6 “Secured and Unsecured Debt of the Operating Partnership” for additional information. | ||||||
[2] | Represents gross sales price before the impact of broker commissions and closing costs. | ||||||
[3] | These properties include two operating properties totaling 136,908 rentable square feet and a 7.0 acre undeveloped land parcel. On July 21, 2016, the Company completed the sale of these properties for a gross sales price of $49.0 million. | ||||||
[4] | This land parcel was classified as held for sale as of December 31, 2015. | ||||||
[5] | The Torrey Santa Fe Properties include the following: 7525 Torrey Santa Fe, 7535 Torrey Santa Fe, 7545 Torrey Santa Fe, and 7555 Torrey Santa Fe. These properties were classified as held for sale at December 31, 2015. | ||||||
[6] | Represents gross sales price before the impact of broker commissions and closing costs. |
Deferred Leasing Costs and Ac49
Deferred Leasing Costs and Acquisition-related Intangible Assets and Liabilities, net (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 | ||
Deferred Leasing Costs and Acquisition-related Intangible Assets, Net | ||||
Finite-lived intangible assets, net | [1] | $ 186,903 | $ 176,683 | |
Acquisition-related Intangible Liabilities, Net | ||||
Finite lived intangible liabilities, net | [2],[3] | 33,112 | 32,324 | |
Deferred leasing costs and acquisition-related intangible assets, net [Member] | ||||
Deferred Leasing Costs and Acquisition-related Intangible Assets, Net | ||||
Finite-lived intangible assets, gross | [1] | 228,701 | 205,888 | |
Finite-lived intangible assets accumulated amortization | [1] | (81,460) | (72,745) | |
Finite-lived intangible assets, net | [1] | 147,241 | 133,143 | |
Above-market leases [Member] | ||||
Deferred Leasing Costs and Acquisition-related Intangible Assets, Net | ||||
Finite-lived intangible assets, gross | [1] | 10,662 | 10,989 | |
Finite-lived intangible assets accumulated amortization | [1] | (7,188) | (6,739) | |
Finite-lived intangible assets, net | [1] | 3,474 | [4] | 4,250 |
In-place leases [Member] | ||||
Deferred Leasing Costs and Acquisition-related Intangible Assets, Net | ||||
Finite-lived intangible assets, gross | [1] | 72,944 | 72,639 | |
Finite-lived intangible assets accumulated amortization | [1] | (37,212) | (33,810) | |
Finite-lived intangible assets, net | [1] | 35,732 | 38,829 | |
Below market ground lease obligation [Member] | ||||
Deferred Leasing Costs and Acquisition-related Intangible Assets, Net | ||||
Finite-lived intangible assets, gross | [1] | 490 | 490 | |
Finite-lived intangible assets accumulated amortization | [1] | (34) | (29) | |
Finite-lived intangible assets, net | [1] | 456 | [5] | 461 |
Below market lease [Member] | ||||
Acquisition-related Intangible Liabilities, Net | ||||
Finite lived intangible liabilities, gross | [2],[3] | 57,166 | 53,502 | |
Finite lived intangible liabilities accumulated amortization | [2],[3] | (29,899) | (27,074) | |
Finite lived intangible liabilities, net | [2],[3] | 27,267 | [6] | 26,428 |
Above-market ground lease obligation [Member] | ||||
Acquisition-related Intangible Liabilities, Net | ||||
Finite lived intangible liabilities, gross | [2],[3] | 6,320 | 6,320 | |
Finite lived intangible liabilities accumulated amortization | [2],[3] | (475) | (424) | |
Finite lived intangible liabilities, net | [2],[3] | $ 5,845 | [7] | $ 5,896 |
[1] | Excludes deferred leasing costs and acquisition-related intangible assets, net related to properties held for sale. | |||
[2] | Excludes acquisition-related intangible liabilities, net related to properties held for sale. | |||
[3] | Included in deferred revenue and acquisition-related intangible liabilities, net in the consolidated balance sheets. | |||
[4] | 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. | |||
[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] | 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. | |||
[7] | 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 Ac50
Deferred Leasing Costs and Acquisition-related Intangible Assets and Liabilities, net (Details 1) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | ||||
Amortization for the period related to deferred leasing costs and acquisition-related intangibles | ||||||||
Amortization of intangible assets | $ 7,967 | $ 8,385 | $ 16,012 | $ 17,476 | ||||
Estimated annual amortization related to acquisition-related intangibles | ||||||||
Finite-lived intangible assets, net | [1] | 186,903 | 186,903 | $ 176,683 | ||||
Acquisition-related Intangible Liabilities, net | [2],[3] | (33,112) | (33,112) | (32,324) | ||||
Deferred leasing costs and acquisition-related intangible assets, net [Member] | ||||||||
Amortization for the period related to deferred leasing costs and acquisition-related intangibles | ||||||||
Amortization of intangible assets | [4] | 6,961 | 7,093 | 13,744 | 13,914 | |||
Estimated annual amortization related to acquisition-related intangibles | ||||||||
Remaining 2,016 | 14,251 | 14,251 | ||||||
2,017 | 26,180 | 26,180 | ||||||
2,018 | 22,883 | 22,883 | ||||||
2,019 | 18,748 | 18,748 | ||||||
2,020 | 14,495 | 14,495 | ||||||
Thereafter | 50,684 | 50,684 | ||||||
Finite-lived intangible assets, net | [1] | 147,241 | 147,241 | 133,143 | ||||
Above-market leases [Member] | ||||||||
Amortization for the period related to deferred leasing costs and acquisition-related intangibles | ||||||||
Amortization of intangible assets | [5] | 384 | 737 | 776 | 1,648 | |||
Estimated annual amortization related to acquisition-related intangibles | ||||||||
Remaining 2,016 | [6] | 725 | 725 | |||||
2,017 | [6] | 1,241 | 1,241 | |||||
2,018 | [6] | 831 | 831 | |||||
2,019 | [6] | 643 | 643 | |||||
2,020 | [6] | 16 | 16 | |||||
Thereafter | [6] | 18 | 18 | |||||
Finite-lived intangible assets, net | [1] | 3,474 | [6] | 3,474 | [6] | 4,250 | ||
In-place leases [Member] | ||||||||
Amortization for the period related to deferred leasing costs and acquisition-related intangibles | ||||||||
Amortization of intangible assets | [4] | 2,669 | 4,416 | 5,557 | 8,637 | |||
Estimated annual amortization related to acquisition-related intangibles | ||||||||
Remaining 2,016 | 5,466 | 5,466 | ||||||
2,017 | 9,738 | 9,738 | ||||||
2,018 | 6,998 | 6,998 | ||||||
2,019 | 5,149 | 5,149 | ||||||
2,020 | 2,923 | 2,923 | ||||||
Thereafter | 5,458 | 5,458 | ||||||
Finite-lived intangible assets, net | [1] | 35,732 | 35,732 | 38,829 | ||||
Below market ground lease obligation [Member] | ||||||||
Amortization for the period related to deferred leasing costs and acquisition-related intangibles | ||||||||
Amortization of intangible assets | [7] | 2 | 2 | 4 | 4 | |||
Estimated annual amortization related to acquisition-related intangibles | ||||||||
Remaining 2,016 | [8] | 4 | 4 | |||||
2,017 | [8] | 8 | 8 | |||||
2,018 | [8] | 8 | 8 | |||||
2,019 | [8] | 8 | 8 | |||||
2,020 | [8] | 8 | 8 | |||||
Thereafter | [8] | 420 | 420 | |||||
Finite-lived intangible assets, net | [1] | 456 | [8] | 456 | [8] | 461 | ||
Below market lease [Member] | ||||||||
Amortization for the period related to deferred leasing costs and acquisition-related intangibles | ||||||||
Amortization of intangible liabilities | [9] | (2,024) | (3,838) | (4,019) | (6,677) | |||
Estimated annual amortization related to acquisition-related intangibles | ||||||||
Remaining 2,016 | [10] | (4,494) | (4,494) | |||||
2,017 | [10] | (8,437) | (8,437) | |||||
2,018 | [10] | (7,159) | (7,159) | |||||
2,019 | [10] | (4,583) | (4,583) | |||||
2,020 | [10] | (2,169) | (2,169) | |||||
Thereafter | [10] | (425) | (425) | |||||
Acquisition-related Intangible Liabilities, net | [2],[3] | (27,267) | [10] | (27,267) | [10] | (26,428) | ||
Above-market ground lease obligation [Member] | ||||||||
Amortization for the period related to deferred leasing costs and acquisition-related intangibles | ||||||||
Amortization of intangible liabilities | [11] | (25) | $ (25) | (50) | $ (50) | |||
Estimated annual amortization related to acquisition-related intangibles | ||||||||
Remaining 2,016 | [12] | (50) | (50) | |||||
2,017 | [12] | (101) | (101) | |||||
2,018 | [12] | (101) | (101) | |||||
2,019 | [12] | (101) | (101) | |||||
2,020 | [12] | (101) | (101) | |||||
Thereafter | [12] | (5,391) | (5,391) | |||||
Acquisition-related Intangible Liabilities, net | [2],[3] | $ (5,845) | [12] | $ (5,845) | [12] | $ (5,896) | ||
[1] | Excludes deferred leasing costs and acquisition-related intangible assets, net related to properties held for sale. | |||||||
[2] | Excludes acquisition-related intangible liabilities, net related to properties held for sale. | |||||||
[3] | Included in deferred revenue and acquisition-related intangible liabilities, net in the consolidated balance sheets. | |||||||
[4] | 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. | |||||||
[5] | 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. | |||||||
[6] | 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. | |||||||
[7] | 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. | |||||||
[8] | 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. | |||||||
[9] | 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. | |||||||
[10] | 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. | |||||||
[11] | 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. | |||||||
[12] | 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 ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 | |
Current Receivables, net | |||
Current receivables | $ 11,930 | $ 13,233 | |
Allowance for uncollectible tenant receivables | (1,818) | (2,080) | |
Current receivables, net (1) | [1] | 10,112 | 11,153 |
Deferred Rent Receivables, net | |||
Deferred rent receivables | 209,378 | 191,586 | |
Allowance for deferred rent receivables | (1,527) | (1,882) | |
Deferred rent receivables, net (1) | [2] | $ 207,851 | $ 189,704 |
[1] | Excludes current receivables, net related to real estate held for sale. | ||
[2] | Excludes deferred rent receivables related to real estate held for sale. |
Secured and Unsecured Debt of52
Secured and Unsecured Debt of the Operating Partnership - Secured Debt (Details) - Kilroy Realty, L.P. [Member] - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2016 | Dec. 31, 2015 | ||
Debt Instrument [Line Items] | |||
Total debt | [1] | $ 2,453,098 | |
Secured Debt [Member] | |||
Debt Instrument [Line Items] | |||
Total debt | 374,410 | $ 381,918 | |
Unamortized deferred financing costs | (910) | (1,083) | |
Total secured debt, net | 373,500 | 380,835 | |
Unamortized premium | $ 5,300 | 6,200 | |
Secured Debt [Member] | 4.27% Mortgage Payable due Feb. 01, 2018 [Member] | |||
Debt Instrument [Line Items] | |||
Annual Stated Interest Rate (percent) | [2],[3] | 4.27% | |
Effective interest rate (percent) | [2],[4] | 4.27% | |
Maturity Date | [3] | Feb. 1, 2018 | |
Total debt | [3] | $ 127,049 | 128,315 |
Secured Debt [Member] | 4.48% Mortgage Payable due July 1, 2027 [Member] | |||
Debt Instrument [Line Items] | |||
Annual Stated Interest Rate (percent) | [2],[3] | 4.48% | |
Effective interest rate (percent) | [2],[3],[4] | 4.48% | |
Maturity Date | [3] | Jul. 1, 2027 | |
Total debt | [3] | $ 95,563 | 96,354 |
Secured Debt [Member] | 6.05% Mortgage Payable Due June 1, 2019 [Member] | |||
Debt Instrument [Line Items] | |||
Annual Stated Interest Rate (percent) | [2],[3],[5] | 6.05% | |
Effective interest rate (percent) | [2],[3],[4],[5] | 3.50% | |
Maturity Date | [3],[5] | Jun. 1, 2019 | |
Total debt | [3],[5] | $ 84,179 | 85,890 |
Secured Debt [Member] | 6.51% Mortgage Payable due Feb. 01, 2017 [Member] | |||
Debt Instrument [Line Items] | |||
Annual Stated Interest Rate (percent) | [2] | 6.51% | |
Effective interest rate (percent) | [2],[4] | 6.51% | |
Maturity Date | Feb. 1, 2017 | ||
Total debt | $ 64,994 | 65,563 | |
Secured Debt [Member] | 7.15% Mortgage Payable due May 01, 2017 [Member] | |||
Debt Instrument [Line Items] | |||
Annual Stated Interest Rate (percent) | [2] | 7.15% | |
Effective interest rate (percent) | [2],[4] | 7.15% | |
Maturity Date | May 1, 2017 | ||
Total debt | $ 2,625 | 3,987 | |
Secured Debt [Member] | Other [Member] | |||
Debt Instrument [Line Items] | |||
Total debt | [6] | $ 0 | $ 1,809 |
[1] | Includes gross principal balance of outstanding debt before the effect of the following at June 30, 2016: $11.9 million of unamortized deferred financing costs, $7.0 million of unamortized discounts for the unsecured senior notes and $5.3 million of unamortized premiums for the secured debt. | ||
[2] | All interest rates presented are fixed-rate interest rates. | ||
[3] | 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. | ||
[4] | Represents the effective interest rate including the amortization of initial issuance discounts/premiums excluding the amortization of deferred financing costs. | ||
[5] | Amounts reported include the amounts of unamortized debt premiums of $5.3 million and $6.2 million as of June 30, 2016 and December 31, 2015, respectively. | ||
[6] | Balance of $1.8 million as of December 31, 2015 included public facility bonds that were assumed by the buyers in connection with sales of land during the six months ended June 30, 2016. |
Secured and Unsecured Debt of53
Secured and Unsecured Debt of the Operating Partnership - Unsecured Debt (Details) - Kilroy Realty, L.P. [Member] - USD ($) $ in Thousands | 3 Months Ended | ||
Jun. 30, 2016 | Dec. 31, 2015 | ||
Debt Instrument [Line Items] | |||
Total debt | [1] | $ 2,453,098 | |
Unsecured Senior Notes [Member] | |||
Debt Instrument [Line Items] | |||
Total secured debt, net | $ 1,657,970 | $ 1,656,776 | |
Unsecured Senior Notes [Member] | 4.375% Unsecured Senior Notes due October 2025 [Member] | |||
Debt Instrument [Line Items] | |||
Maturity date | [2] | Oct. 1, 2025 | |
Stated coupon rate (percent) | [2] | 4.375% | |
Effective interest rate (percent) | [2],[3] | 4.44% | |
Total debt | [2] | $ 400,000 | 400,000 |
Unamortized discount and deferred financing costs | (5,123) | (5,400) | |
Total secured debt, net | $ 394,877 | 394,600 | |
Unsecured Senior Notes [Member] | 4.250% Unsecured Senior Notes due August 2029 [Member] | |||
Debt Instrument [Line Items] | |||
Maturity date | [4] | Aug. 15, 2029 | |
Stated coupon rate (percent) | [4] | 4.25% | |
Effective interest rate (percent) | [3],[4] | 4.35% | |
Total debt | [4] | $ 400,000 | 400,000 |
Unamortized discount and deferred financing costs | (6,962) | (7,228) | |
Total secured debt, net | $ 393,038 | 392,772 | |
Unsecured Senior Notes [Member] | 3.800% Unsecured Senior Note due January 2023 [Member] | |||
Debt Instrument [Line Items] | |||
Maturity date | [5] | Jan. 15, 2023 | |
Stated coupon rate (percent) | [5] | 3.80% | |
Effective interest rate (percent) | [3],[5] | 3.804% | |
Total debt | [5] | $ 300,000 | 300,000 |
Unamortized discount and deferred financing costs | (1,794) | (1,931) | |
Total secured debt, net | $ 298,206 | 298,069 | |
Unsecured Senior Notes [Member] | 4.800% Unsecured Senior Notes due July 2018 [Member] | |||
Debt Instrument [Line Items] | |||
Maturity date | [5],[6] | Jul. 15, 2018 | |
Stated coupon rate (percent) | [5],[6] | 4.80% | |
Effective interest rate (percent) | [3],[5],[6] | 4.827% | |
Total debt | [5],[6] | $ 325,000 | 325,000 |
Unamortized discount and deferred financing costs | (1,009) | (1,251) | |
Total secured debt, net | $ 323,991 | 323,749 | |
Unsecured Senior Notes [Member] | 6.625% Unsecured Senior Notes due June 2020 [Member] | |||
Debt Instrument [Line Items] | |||
Maturity date | [7] | Jun. 1, 2020 | |
Stated coupon rate (percent) | [7] | 6.625% | |
Effective interest rate (percent) | [3],[7] | 6.743% | |
Total debt | [7] | $ 250,000 | 250,000 |
Unamortized discount and deferred financing costs | (2,142) | (2,414) | |
Total secured debt, net | $ 247,858 | $ 247,586 | |
[1] | Includes gross principal balance of outstanding debt before the effect of the following at June 30, 2016: $11.9 million of unamortized deferred financing costs, $7.0 million of unamortized discounts for the unsecured senior notes and $5.3 million of unamortized premiums for the secured debt. | ||
[2] | Interest on these notes is payable semi-annually in arrears on April 1st and October 1st of each year. | ||
[3] | Represents the effective interest rate including the amortization of initial issuance discounts/premiums excluding the amortization of deferred financing costs. | ||
[4] | Interest on these notes is payable semi-annually in arrears on February 15th and August 15th of each year. | ||
[5] | Interest on these notes is payable semi-annually in arrears on January 15th and July 15th of each year. | ||
[6] | In October 2015, certain common limited partners in the Operating Partnership that previously contributed their interests in the property at 6255 W. Sunset Blvd., Los Angeles, California to the Operating Partnership entered into an agreement with the Company. Pursuant to this agreement, such common limited partners will reimburse the Company for a portion of any amounts the Company may be required to pay pursuant to its guarantee of the Operating Partnership’s 4.800% Senior Notes due 2018 or that the Company may otherwise become required to pay under applicable law with respect to such notes. | ||
[7] | Interest on these notes is payable semi-annually in arrears on June 1st and December 1st of each year. |
Secured and Unsecured Debt of54
Secured and Unsecured Debt of the Operating Partnership - Unsecured Term Loan Facility (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2016 | Dec. 31, 2015 | ||
Line of Credit Facility [Line Items] | |||
Unsecured debt | $ 1,845,992 | $ 1,844,634 | |
Kilroy Realty, L.P. [Member] | |||
Line of Credit Facility [Line Items] | |||
Unsecured debt | 1,845,992 | 1,844,634 | |
Unamortized deferred financing costs | 11,900 | ||
Kilroy Realty, L.P. [Member] | Line of Credit [Member] | $150 Million Term Loan Facility due July 2019 [Member] | |||
Line of Credit Facility [Line Items] | |||
Unsecured debt | [1] | $ 150,000 | $ 150,000 |
Effective interest rate (percent) | [2] | 1.62% | 1.40% |
Maturity date | Jul. 1, 2019 | Jul. 1, 2019 | |
Debt Issuance Costs, Line of Credit Arrangements, Gross | $ 800 | $ 900 | |
Unamortized deferred financing costs | $ 900 | ||
Kilroy Realty, L.P. [Member] | Line of Credit [Member] | $150 Million Term Loan Facility due July 2019 [Member] | LIBOR [Member] | |||
Line of Credit Facility [Line Items] | |||
Variable rate (percent) | 1.15% | 1.15% | |
Kilroy Realty, L.P. [Member] | Line of Credit [Member] | $39 Million Unsecured Term Loan due July 2019 [Member] | |||
Line of Credit Facility [Line Items] | |||
Unsecured debt | $ 39,000 | ||
Unamortized deferred financing costs | $ 200 | $ 200 | |
Kilroy Realty, L.P. [Member] | Line of Credit [Member] | $39 Million Unsecured Term Loan due July 2019 [Member] | LIBOR [Member] | |||
Line of Credit Facility [Line Items] | |||
Variable rate (percent) | 1.15% | ||
[1] | As of June 30, 2016 and December 31, 2015, $0.8 million and $0.9 million of unamortized deferred financing costs, respectively, remained to be amortized through the maturity date of our unsecured term loan facility. | ||
[2] | Our unsecured term loan facility interest rate was calculated based on an annual rate of LIBOR plus 1.150% as of June 30, 2016 and December 31, 2015. |
Secured and Unsecured Debt of55
Secured and Unsecured Debt of the Operating Partnership - Unsecured Revolving Credit Facility (Details) - USD ($) | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2016 | Dec. 31, 2015 | ||||
Terms of the Credit Facility | |||||
Unsecured line of credit | $ 220,000,000 | $ 0 | |||
Kilroy Realty, L.P. [Member] | |||||
Terms of the Credit Facility | |||||
Unsecured line of credit | 220,000,000 | 0 | |||
Unamortized deferred financing costs | 11,900,000 | ||||
Kilroy Realty, L.P. [Member] | Revolving Credit Facility [Member] | |||||
Terms of the Credit Facility | |||||
Unsecured line of credit | [1] | 220,000,000 | 0 | ||
Remaining borrowing capacity | 380,000,000 | 600,000,000 | |||
Total borrowing capacity | [2] | $ 600,000,000 | $ 600,000,000 | ||
Interest rate (percent) | [3] | 1.52% | 1.40% | ||
Facility fee-annual rate (percent) | 0.20% | [4] | 0.20% | [3] | |
Maturity date | Jul. 1, 2019 | Jul. 1, 2019 | |||
Contingent additional borrowings | $ 311,000,000 | ||||
Variable rate (percent) | 1.05% | 1.05% | |||
Unamortized deferred financing costs | $ 3,900,000 | $ 4,600,000 | |||
[1] | On July 20, 2016, we repaid the total outstanding borrowings on our unsecured revolving credit facility. Refer to Note 17 “Subsequent Events” for additional information | ||||
[2] | We may elect to borrow, subject to bank approval and obtaining commitments for any additional borrowing capacity, up to an additional $311.0 million under an accordion feature under the terms of the unsecured revolving credit facility and term loan facility. | ||||
[3] | Our unsecured revolving credit facility interest rate was calculated based on an annual rate of LIBOR plus 1.050% as of June 30, 2016 and December 31, 2015. | ||||
[4] | Our facility fee is paid on a quarterly basis and is calculated based on the total borrowing capacity. In addition to the facility fee, we incurred debt origination and legal costs. As of June 30, 2016 and December 31, 2015, $3.9 million and $4.6 million, of unamortized deferred financing costs, respectively, remained to be amortized through the maturity date of our unsecured revolving credit facility, which are included in prepaid expenses and other assets, net on our consolidated balance sheets. |
Secured and Unsecured Debt of56
Secured and Unsecured Debt of the Operating Partnership - Debt Maturities (Details) - Kilroy Realty, L.P. [Member] - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 | |
Stated debt maturities and scheduled amortization payments, excluding debt discounts | |||
Remaining 2,016 | $ 4,926 | ||
2,017 | 71,692 | ||
2,018 | 451,669 | ||
2,019 | 485,309 | ||
2,020 | 251,913 | ||
Thereafter | 1,187,589 | ||
Total debt | [1] | 2,453,098 | |
Unamortized debt issuance costs | 11,900 | ||
Unsecured Senior Notes [Member] | |||
Stated debt maturities and scheduled amortization payments, excluding debt discounts | |||
Unamortized discount | (7,000) | ||
Secured Debt [Member] | |||
Stated debt maturities and scheduled amortization payments, excluding debt discounts | |||
Total debt | 374,410 | $ 381,918 | |
Unamortized premium | $ 5,300 | $ 6,200 | |
[1] | Includes gross principal balance of outstanding debt before the effect of the following at June 30, 2016: $11.9 million of unamortized deferred financing costs, $7.0 million of unamortized discounts for the unsecured senior notes and $5.3 million of unamortized premiums for the secured debt. |
Secured and Unsecured Debt of57
Secured and Unsecured Debt of the Operating Partnership - Capitalized Interest and Loan Fees (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Capitalized Interest and Loan Fees [Line Items] | ||||
Interest expense | $ 14,384 | $ 14,864 | $ 26,213 | $ 31,742 |
Kilroy Realty, L.P. [Member] | ||||
Capitalized Interest and Loan Fees [Line Items] | ||||
Gross interest expense | 26,668 | 27,187 | 52,843 | 54,936 |
Capitalized interest and deferred financing costs | (12,284) | (12,323) | (26,630) | (23,194) |
Interest expense | $ 14,384 | $ 14,864 | $ 26,213 | $ 31,742 |
Noncontrolling Interests on t58
Noncontrolling Interests on the Company's Consolidated Financial Statements (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 6 Months Ended | ||
Mar. 31, 2016 | Jun. 30, 2016 | Dec. 31, 2015 | Jun. 30, 2015 | |
Noncontrolling Interest [Line Items] | ||||
Common general partnership interest in the Operating Partnership (percentage) | 97.20% | 98.10% | 98.00% | |
Common limited partnership interest in the Operating Partnership (percentage) | 2.80% | 1.90% | 2.00% | |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | ||
Aggregate value upon redemption of outstanding noncontrolling common units | $ 168.8 | $ 112 | ||
Brannan St Project [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Common units issued | 867,701 | 867,701 | ||
Common stock, par value (in dollars per share) | $ 0.01 | |||
Kilroy Realty, L.P. [Member] | Capital Units [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Common units outstanding held by common limited partners | 2,631,276 | 1,764,775 | 1,793,170 |
Stockholders' Equity of the C59
Stockholders' Equity of the Company (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016 | Mar. 31, 2016 | Jun. 30, 2016 | Feb. 23, 2016 | Dec. 31, 2015 | |
Common Stock of the Company [Abstract] | |||||
At the market stock offering aggregate gross sales price of common stock | $ 300,000,000 | $ 300,000,000 | |||
Shares issued to date | 92,254,768 | 92,254,768 | 92,258,690 | ||
Number of shares authorized for repurchase | 4,000,000 | ||||
Remaining number of shares authorized for repurchase | 4,935,826 | 4,935,826 | 4,988,025 | ||
Number of shares repurchased during period | 0 | 52,199 | |||
Weighted average price paid per share repurchased during period (in dollars per share) | $ 55.45 | ||||
Value of shares repurchased during period | $ 2,900,000 | ||||
Common Stock [Member] | |||||
Common Stock of the Company [Abstract] | |||||
Issuance of common stock during period, shares | 0 | ||||
At the market stock offering remaining amount available for issuance | $ 149,900,000 | $ 149,900,000 | |||
Issuance of Equity - at the market offering [Member] | Common Stock [Member] | |||||
Common Stock of the Company [Abstract] | |||||
At the market stock offering aggregate gross sales price of common stock | $ 150,100,000 | $ 150,100,000 | |||
Shares issued to date | 2,007,767 | 2,007,767 |
Partners_ Capital of the Oper60
Partners’ Capital of the Operating Partnership (Details) - $ / shares | 1 Months Ended | 6 Months Ended | ||
Mar. 31, 2016 | Jun. 30, 2016 | Dec. 31, 2015 | Jun. 30, 2015 | |
Class of Stock [Line Items] | ||||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | ||
General Partners' Capital Account [Abstract] | ||||
Company owned general partnership interest | 97.20% | 98.10% | 98.00% | |
Ownership interest of noncontrolling interest | 2.80% | 1.90% | 2.00% | |
Kilroy Realty, L.P. [Member] | Capital Units [Member] | ||||
General Partners' Capital Account [Abstract] | ||||
Company owned common units in the Operating Partnership | 92,254,768 | 92,258,690 | 88,405,632 | |
Noncontrolling common units of the Operating Partnership | 2,631,276 | 1,764,775 | 1,793,170 | |
Brannan St Project [Member] | ||||
Class of Stock [Line Items] | ||||
Common units issued | 867,701 | 867,701 | ||
Value per common unit issued | $ 55.36 | |||
Common stock, par value (in dollars per share) | $ 0.01 |
Share-Based Compensation (Detai
Share-Based Compensation (Details Textual) $ / shares in Units, $ in Millions | Jan. 28, 2016USD ($)$ / sharesshares | Jan. 09, 2016USD ($)shares | Jun. 30, 2016USD ($)planshares | Jun. 30, 2015USD ($) | Jun. 30, 2016USD ($)planshares | Jun. 30, 2015USD ($) | Jan. 08, 2016$ / shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of share-based incentive compensation plans | plan | 1 | 1 | |||||
Share-based compensation expense | $ | $ 6.6 | $ 5 | $ 12.5 | $ 9.3 | |||
Share-based compensation expense capitalized | $ | 1.3 | $ 0.9 | 2.5 | $ 1.6 | |||
Share-based compensation not yet recognized | $ | $ 40.5 | $ 40.5 | |||||
Share-based compensation not yet recognized period of recognition | 2 years | ||||||
Restricted Stock Units (RSUs) [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares granted | 294,821 | ||||||
2016 Performance Based RSUs [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares granted | 168,077 | ||||||
Percentage of shares granted | 57.00% | ||||||
Vesting period | 3 years | ||||||
RSUs expected to vest (in shares) | 214,632 | 214,632 | |||||
Number of shares issuable per RSU | 1 | ||||||
Grant date fair value | $ | $ 9.6 | ||||||
Grant date fair value (in dollars per share) | $ / shares | $ 57.08 | ||||||
Remaining expected life | 2 years 11 months | ||||||
2016 Time-Based RSUs [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares granted | 126,744 | ||||||
Percentage of shares granted | 43.00% | ||||||
Vesting period | 3 years | ||||||
Grant date fair value | $ | $ 7.1 | ||||||
Closing share price (in dollars per share) | $ / shares | $ 56.23 | ||||||
2016 Special RSUs [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares granted | 33,910 | ||||||
Vesting period | 4 years | ||||||
Grant date fair value | $ | $ 2 | ||||||
Closing share price (in dollars per share) | $ / shares | $ 58.98 | ||||||
Kilroy Realty 2006 Incentive Award Plan [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of shares available for grant | 1,382,879 | 1,382,879 |
Share-Based Compensation (Det62
Share-Based Compensation (Details) - 2016 Performance Based RSUs [Member] - $ / shares | Jan. 28, 2016 | Jun. 30, 2016 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Grant date fair value (in dollars per share) | $ 57.08 | |
Expected share price volatility | 26.00% | |
Risk-free interest rate | 1.13% | |
Remaining expected life | 2 years 11 months |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Millions | Jun. 30, 2016USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments | $ 394.3 |
Accrued environmental remediation liabilities | $ 26 |
Fair Value Measurements and D64
Fair Value Measurements and Disclosures (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | ||
Fair value adjustment of marketable securities and deferred compensation plan liability | ||||||
Net gain on marketable securities | $ 249 | $ 122 | $ 386 | $ 510 | ||
Fair Value (Level 1) [Member] | ||||||
Assets and Liabilities Reported at Fair Value | ||||||
Marketable securities | [1],[2] | $ 13,388 | $ 13,388 | $ 12,882 | ||
[1] | Based on quoted prices in active markets for identical securities. | |||||
[2] | The marketable securities are held in a limited rabbi trust. |
Fair Value Measurements and D65
Fair Value Measurements and Disclosures (Details 1) - USD ($) $ in Thousands | Jun. 30, 2016 | Dec. 31, 2015 | |
Carrying Value [Member] | Secured Debt [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value of debt | $ 373,500 | $ 380,835 | |
Carrying Value [Member] | Unsecured Debt [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value of debt | 1,845,992 | 1,844,634 | |
Carrying Value [Member] | Line of Credit [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value of debt | 220,000 | 0 | |
Fair Value (Level 2) [Member] | Fair Value [Member] | Secured Debt [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value of debt | [1] | 387,976 | 391,611 |
Fair Value (Level 2) [Member] | Fair Value [Member] | Unsecured Debt [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value of debt | [1] | 1,987,469 | 1,898,863 |
Fair Value (Level 2) [Member] | Fair Value [Member] | Line of Credit [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value of debt | [1] | $ 220,442 | $ 0 |
[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. |
Net Income Available to Commo66
Net Income Available to Common Stockholders Per Share of the Company (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | ||
Numerator: | |||||
Net income attributable to Kilroy Realty Corporation | $ 32,847 | $ 57,500 | $ 207,155 | $ 100,687 | |
Preferred dividends | (3,312) | (3,312) | (6,625) | (6,625) | |
Allocation to participating securities | [1] | (423) | (418) | (818) | (833) |
Numerator for basic and diluted net income available to common stockholders | $ 29,112 | $ 53,770 | $ 199,712 | $ 93,229 | |
Denominator: | |||||
Basic weighted average vested shares outstanding (in shares) | 92,209,955 | 88,126,187 | 92,217,238 | 87,514,878 | |
Effect of dilutive securities (in shares) | 614,831 | 519,681 | 566,827 | 529,414 | |
Diluted weighted average vested shares and common share equivalents outstanding (in shares) | 92,824,786 | 88,645,868 | 92,784,065 | 88,044,292 | |
Basic earnings per share: | |||||
Net income available to common stockholders per share (in dollars per share) | $ 0.32 | $ 0.61 | $ 2.17 | $ 1.07 | |
Diluted earnings per share: | |||||
Net income available to common stockholders per share (in dollars per share) | $ 0.31 | $ 0.61 | $ 2.15 | $ 1.06 | |
[1] | Participating securities include nonvested shares, certain time-based RSUs and vested market measure-based RSUs. |
Net Income Available to Commo67
Net Income Available to Common Unitholders Per Unit of the Operating Partnership (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | ||
Numerator: | |||||
Net income attributable to Kilroy Realty, L.P. | $ 32,847 | $ 57,500 | $ 207,155 | $ 100,687 | |
Preferred distributions | (3,312) | (3,312) | (6,625) | (6,625) | |
Allocation to participating securities | [1] | (423) | (418) | (818) | (833) |
Numerator for basic and diluted net income available to common stockholders | $ 29,112 | $ 53,770 | $ 199,712 | $ 93,229 | |
Denominator: | |||||
Basic weighted average vested shares outstanding (in shares) | 92,209,955 | 88,126,187 | 92,217,238 | 87,514,878 | |
Effect of dilutive securities (in shares) | 614,831 | 519,681 | 566,827 | 529,414 | |
Diluted weighted average vested shares and common share equivalents outstanding (in shares) | 92,824,786 | 88,645,868 | 92,784,065 | 88,044,292 | |
Basic earnings per unit: | |||||
Net income available to common stockholders per share (in dollars per share) | $ 0.32 | $ 0.61 | $ 2.17 | $ 1.07 | |
Diluted earnings per unit: | |||||
Net income available to common stockholders per share (in dollars per share) | $ 0.31 | $ 0.61 | $ 2.15 | $ 1.06 | |
Kilroy Realty, L.P. [Member] | |||||
Numerator: | |||||
Net income attributable to Kilroy Realty, L.P. | $ 33,590 | $ 58,518 | $ 211,423 | $ 102,445 | |
Preferred distributions | (3,312) | (3,312) | (6,625) | (6,625) | |
Allocation to participating securities | [2] | (423) | (418) | (818) | (833) |
Numerator for basic and diluted net income available to common stockholders | $ 29,855 | $ 54,788 | $ 203,980 | $ 94,987 | |
Denominator: | |||||
Basic weighted average vested shares outstanding (in shares) | 94,841,231 | 89,919,357 | 94,514,876 | 89,309,718 | |
Effect of dilutive securities (in shares) | 614,831 | 519,681 | 566,827 | 529,414 | |
Diluted weighted average vested shares and common share equivalents outstanding (in shares) | 95,456,062 | 90,439,038 | 95,081,703 | 89,839,132 | |
Basic earnings per unit: | |||||
Net income available to common stockholders per share (in dollars per share) | $ 0.31 | $ 0.61 | $ 2.16 | $ 1.06 | |
Diluted earnings per unit: | |||||
Net income available to common stockholders per share (in dollars per share) | $ 0.31 | $ 0.61 | $ 2.15 | $ 1.06 | |
[1] | Participating securities include nonvested shares, certain time-based RSUs and vested market measure-based RSUs. | ||||
[2] | Participating securities include nonvested shares, certain time-based RSUs and vested market measure-based RSUs. |
Supplemental Cash Flow Inform68
Supplemental Cash Flow Information of the Company Supplemental Cash Flow Information of the Company (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
SUPPLEMENTAL CASH FLOWS INFORMATION: | ||
Cash paid for interest, net of capitalized interest of $25,674 and $22,753 as of June 30, 2016 and 2015, respectively | $ 25,787 | $ 31,846 |
Interest capitalized | 25,674 | 22,753 |
NONCASH INVESTING TRANSACTIONS: | ||
Accrual for expenditures for operating properties and development properties | 50,246 | 65,752 |
Tenant improvements funded directly by tenants | 10,713 | 13,036 |
Assumption of accrued liabilities in connection with acquisitions (Note 2) | 4,911 | 1,478 |
Release of holdback funds to third party | 0 | 9,279 |
NONCASH FINANCING TRANSACTIONS: | ||
Issuance of common units of the Operating Partnership in connection with an acquisition (Note 2) | 48,033 | 0 |
Accrual of dividends and distributions payable to common stockholders and common unitholders | 36,093 | 32,030 |
Accrual of dividends and distributions payable to preferred stockholders and preferred unitholders | 1,656 | 1,656 |
Secured debt assumed by buyers in connection with land dispositions (Note 3) | 2,322 | 0 |
Exchange of common units of the Operating Partnership into shares of the Company’s common stock | $ 39 | $ 316 |
Supplemental Cash Flow Inform69
Supplemental Cash Flow Information of the Operating Partnership Supplemental Cash Flow Information of the Operating Partnership (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
SUPPLEMENTAL CASH FLOWS INFORMATION: | ||
Cash paid for interest, net of capitalized interest of $25,674 and $22,753 as of June 30, 2016 and 2015, respectively | $ 25,787 | $ 31,846 |
Interest capitalized | 25,674 | 22,753 |
NONCASH INVESTING TRANSACTIONS: | ||
Accrual for expenditures for operating properties and development properties | 50,246 | 65,752 |
Tenant improvements funded directly by tenants | 10,713 | 13,036 |
Assumption of accrued liabilities in connection with development acquisitions (Note 2) | 4,911 | 1,478 |
Release of holdback funds to third party | 0 | 9,279 |
NONCASH FINANCING TRANSACTIONS: | ||
Issuance of common units in connection with an acquisition (Note 2) | 48,033 | 0 |
Accrual of distributions payable to common unitholders | 36,093 | 32,030 |
Accrual of distributions payable to preferred unitholders | 1,656 | 1,656 |
Secured debt assumed by buyers in connection with land dispositions (Note 3) | 2,322 | 0 |
Kilroy Realty, L.P. [Member] | ||
SUPPLEMENTAL CASH FLOWS INFORMATION: | ||
Cash paid for interest, net of capitalized interest of $25,674 and $22,753 as of June 30, 2016 and 2015, respectively | 25,787 | 31,846 |
Interest capitalized | 25,674 | 22,753 |
NONCASH INVESTING TRANSACTIONS: | ||
Accrual for expenditures for operating properties and development properties | 50,246 | 65,752 |
Tenant improvements funded directly by tenants | 10,713 | 13,036 |
Assumption of accrued liabilities in connection with development acquisitions (Note 2) | 4,911 | 1,478 |
Release of holdback funds to third party | 0 | 9,279 |
NONCASH FINANCING TRANSACTIONS: | ||
Issuance of common units in connection with an acquisition (Note 2) | 48,033 | 0 |
Accrual of distributions payable to common unitholders | 36,093 | 32,030 |
Accrual of distributions payable to preferred unitholders | 1,656 | 1,656 |
Secured debt assumed by buyers in connection with land dispositions (Note 3) | $ 2,322 | $ 0 |
Subsequent Events (Details)
Subsequent Events (Details) $ in Thousands | Jul. 21, 2016USD ($)property | Jul. 20, 2016USD ($) | Jul. 13, 2016USD ($) | Jun. 30, 2016USD ($)buildingproperty | Jun. 30, 2015USD ($) | |
Subsequent Event [Line Items] | ||||||
Aggregate dividends, distributions, and dividend equivalents paid to common stockholders and common unitholders | $ 65,935 | $ 62,311 | ||||
Proceeds from sale of property held-for-sale | $ 258,100 | |||||
Number of buildings | building | 1 | |||||
Subsequent event [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Aggregate dividends, distributions, and dividend equivalents paid to common stockholders and common unitholders | $ 36,100 | |||||
Proceeds from sale of property held-for-sale | $ 258,100 | |||||
Sales Price (1) (in millions) | [1],[2] | $ 49,000 | ||||
Properties held for Sale [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Number of buildings | property | [3] | 2 | ||||
Properties held for Sale [Member] | Subsequent event [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Number of buildings | property | 2 | |||||
[1] | Represents gross sales price before the impact of broker commissions and closing costs. | |||||
[2] | The Torrey Santa Fe Properties include the following: 7525 Torrey Santa Fe, 7535 Torrey Santa Fe, 7545 Torrey Santa Fe, and 7555 Torrey Santa Fe. These properties were classified as held for sale at December 31, 2015. | |||||
[3] | These properties include two operating properties totaling 136,908 rentable square feet and a 7.0 acre undeveloped land parcel. On July 21, 2016, the Company completed the sale of these properties for a gross sales price of $49.0 million. |