Kilroy Realty (KRC) 8-K First Quarter 2005 Supplemental Financial Report

Exhibit 99.2

[LOGO OF KILROY REALTY CORPORATION]

Contact:	FOR RELEASE:
Richard E. Moran Jr.	April 25, 2005
Executive Vice President
and Chief Financial Officer
(310) 481-8483
or
Tyler H. Rose
Senior Vice President
and Treasurer
(310) 481-8484

KILROY REALTY CORPORATION REPORTS

FIRST QUARTER FINANCIAL RESULTS

LOS ANGELES, April 25, 2005 – Kilroy Realty Corporation(NYSE: KRC) today reported financial results for its first quarter ended March 31, 2005, with net income available for common shareholders of $12.7 million, or $0.44 per share, compared to $6.0 million, or $0.21 per share in the first quarter of 2004. Revenues from continuing operations in the first quarter totaled $59.2 million, compared to $53.3 million in the prior year’s first quarter. Funds from operations (FFO) for the period totaled $25.0 million, or $0.77 per share, compared to $21.0 million, or $0.65 per share, in the year-earlier period.

All per-share amounts in this report are presented on a diluted basis.

“Southern California real estate markets continued to remain solid during the first quarter, with our quarter-end occupancy above 94%,” said John B. Kilroy, Jr., president and chief executive officer of KRC. “Our recently announced lease agreement with Intuit for a new coastal San Diego office campus is a good example of the type of product and location attracting interest in the region today,” he said.

2

KRC maintains an active committed development and redevelopment program in the Southern California commercial real estate market. In addition to the company’s recently announced 466,000 square-foot Santa Fe Summit office development, 78% of which is pre-leased to Intuit, KRC’s pipeline currently includes two buildings under construction totaling approximately 103,000 square feet and one building in lease-up totaling approximately 242,000 square feet. This committed pipeline represents a total estimated investment of approximately $236 million, of which $88 million has been spent to date.

The company also completed the sale of three non-strategic assets for $38.7 million in the first quarter at a gain of $5.8 million. The properties total approximately 305,000 square feet and are located in Santa Ana and Glendale, California and Phoenix, Arizona.

Updated earnings guidance for 2005 will be discussed by KRC management during the company’s April 26, 2005, earnings conference call. The call will begin at 11:00 a.m. PDT and last approximately one hour. Those interested in listening via the internet can access the conference call at www.kilroyrealty.com. Please go to the website 15 minutes before the call and register. It may be necessary to download audio software to hear the conference call. Those interested in listening via telephone can access the conference call at 800-591-6942, passcode 45259324. A replay of the conference call will be available via telephone through May 6th, at 888-286-8010, passcode 19000401, or via the internet at the company’s website.

Some of the information presented in this release is forward looking in nature within the meaning of the Private Securities Litigation Reform Act of 1995. Although Kilroy Realty Corporation believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, there can be no assurance that its expectations will be achieved. Certain factors that could cause actual results to differ materially from Kilroy Realty’s expectations are set forth as risk factors in the company’s Securities and Exchange Commission reports and filings. Included among these factors are changes in general economic conditions, including changes in the economic conditions affecting industries in which its principal tenants compete; Kilroy Realty’s ability to timely lease or re-lease space at current or anticipated rents; changes in interest rates; changes in operating costs, including utility costs; fluctuations in the company’s share price and the resulting impact on general and administrative costs, future demand

3

for its debt and equity securities; its ability to refinance its debt on reasonable terms at maturity; its ability to complete current and future development projects on schedule and on budget; the demand for office space in markets in which Kilroy Realty has a presence; and risks detailed from time to time in the company’s SEC reports, including quarterly reports on Form 10-Q, reports on Form 8-K and annual reports on Form 10-K. Many of these factors are beyond Kilroy Realty’s ability to control or predict. Forward-looking statements are not guarantees of performance. For forward-looking statements herein, Kilroy Realty claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. The company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.

Kilroy Realty Corporation, a member of the S&P Small Cap 600 Index, is a Southern California-based real estate investment trust active in the office and industrial property sectors. For more than 50 years, the company has owned, developed, acquired and managed real estate assets primarily in the coastal regions of California and Washington. KRC is currently active in office development and redevelopment in Los Angeles and San Diego counties. At March 31, 2005, the company owned 7.6 million square feet of commercial office space and 4.5 million square feet of industrial space. More information is available atwww.kilroyrealty.com.

###

KILROY REALTY CORPORATION CONSOLIDATED BALANCE SHEETS

(unaudited, in thousands)

	March 31, 2005			December 31, 2004
ASSETS
REAL ESTATE ASSETS:
Land and improvements	$	295,409		$	304,033
Buildings and improvements, net		1,428,069			1,445,918
Undeveloped land and construction in progress		103,388			96,545
Total real estate held for investment		1,826,866			1,846,496
Accumulated depreciation and amortization		(373,514	)		(365,831	)
Total real estate assets, net		1,453,352			1,480,665
Cash and cash equivalents		11,040			4,853
Restricted cash		2			332
Current receivables, net		3,177			4,843
Deferred rent receivables, net		49,015			46,816
Deferred leasing costs and other related intangibles, net		49,586			51,251
Deferred financing costs, net		6,102			5,849
Prepaid expenses and other assets		8,332			5,046
TOTAL ASSETS	$	1,580,606		$	1,599,655
LIABILITIES & STOCKHOLDERS' EQUITY
LIABILITIES:
Secured debt	$	486,563		$	490,441
Unsecured senior notes		144,000			144,000
Unsecured line of credit		153,000			167,000
Accounts payable, accrued expenses and other liabilities		71,874			73,005
Accrued distributions		17,844			16,923
Rents received in advance, tenant security deposits and deferred revenue		21,404			21,605
Total liabilities		894,685			912,974
MINORITY INTERESTS:
7.45% Series A Cumulative Redeemable Preferred unitholders		73,638			73,638
Common unitholders of the Operating Partnership		56,039			60,351
Total minority interests		129,677			133,989
STOCKHOLDERS' EQUITY:
7.80% Series E Cumulative Redeemable Preferred stock		38,425			38,425
7.50% Series F Cumulative Redeemable Preferred stock		83,157			83,157
Common stock		290			286
Additional paid-in capital		522,233			515,285
Deferred compensation		(3,558	)		(1,412	)
Distributions in excess of earnings		(85,387	)		(83,394	)
Accumulated net other comprehensive income		1,084			345
Total stockholders' equity		556,244			552,692
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY	$	1,580,606		$	1,599,655

4

KILROY REALTY CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited, in thousands, except per share data)

	Three Months Ended March 31, 2005			Three Months Ended March 31, 2004
REVENUES:
Rental income	$	53,268		$	46,909
Tenant reimbursements		5,751			5,323
Other property income		229			1,018
Total revenues		59,248			53,250
EXPENSES:
Property expenses		9,461			8,503
Real estate taxes		4,420			3,889
Provision for bad debts		1,133			224
Ground leases		405			330
General and administrative expenses		6,024			7,693
Interest expense		9,622			9,210
Depreciation and amortization		16,237			13,691
Total expenses		47,302			43,540
OTHER INCOME:
Interest and other income		57			307
Total other income		57			307
Income from continuing operations before minority interests		12,003			10,017
Minority interests:
Distributions on Cumulative Redeemable Preferred units		(1,397	)		(2,521	)
Minority interest in earnings of Operating Partnership attributable to continuing operations		(977	)		(953	)
Total minority interests		(2,374	)		(3,474	)
Income from continuing operations		9,629			6,543
Discontinued operations:
Revenues from discontinued operations		1,068			2,173
Expenses from discontinued operations		(590	)		(1,188	)
Net gain on disposition of discontinued operations		5,779
Impairment loss on property held for sale					(726	)
Minority interest in earnings of Operating Partnership attributable to discontinued operations		(741	)		(33	)
Total income from discontinued operations		5,516			226
Net income		15,145			6,769
Preferred dividends		(2,402	)		(785	)
Net income available for common shareholders	$	12,743		$	5,984
Weighted average shares outstanding—basic		28,555			28,117
Weighted average shares outstanding—diluted		28,720			28,303
Net Income per common share—basic	$	0.45		$	0.21
Net Income per common share—diluted	$	0.44		$	0.21

5

KILROY REALTY CORPORATION FUNDS FROM OPERATIONS

(unaudited, in thousands, except per share data)

	Three Months Ended March 31, 2005			Three Months Ended March 31, 2004
Net income available for common shareholders	$	12,743		$	5,984
Adjustments:
Minority interest in earnings Minority interest in earnings of Operating Partnership		1,718			986
Depreciation and amortization		16,322			13,986
Net gain on dispositions of operating properties		(5,779	)
Funds From Operations (1) (2)	$	25,004		$	20,956
Weighted average common shares/units outstanding—basic		32,401			32,268
Weighted average common shares/units outstanding—diluted		32,587			32,454
Funds From Operations per common share/unit—basic	$	0.77		$	0.65
Funds From Operations per common share/unit—diluted	$	0.77		$	0.65

(1) Management believes that Funds From Operations ("FFO") is a useful supplemental measure of the Company's operating performance. The Company computes FFO in accordance with the White Paper on FFO approved by the Board of Governors of the National Association of Real Estate Investment Trusts ("NAREIT"). The White Paper defines FFO as net income or loss computed in accordance with generally accepted accounting principles ("GAAP"), excluding extraordinary items, as defined by GAAP, and gains and losses from sales of depreciable operating property, plus real estate related depreciation and amortization (excluding amortization of deferred financing costs and depreciation of non-real estate assets), and after adjustment for unconsolidated partnerships and joint ventures. Other real estate investment trusts ("REITs") may use different methodologies for calculating FFO and, accordingly, the Company's FFO may not be comparable to other REITs.

Because FFO excludes depreciation and amortization, gains and losses from property dispositions, and extraordinary items, it provides a performance measure that, when compared year over year, reflects the impact to operations from trends in occupancy rates, rental rates, operating costs, development activities, general and administrative expenses, and interest costs, providing perspective on operating performance not immediately apparent from net income. In addition, management believes that FFO provides useful information to the investment community about the Company's operating performance when compared to other REITs since FFO is generally recognized as the industry standard for reporting the operations of REITs. However, FFO should not be viewed as an alternative measure of the Company’s operating performance since it does not reflect either depreciation and amortization costs or the level of capital expenditures and leasing costs necessary to maintain the operating performance of the Company's properties, which are significant economic costs that could materially impact the Company’s results of operations.

(2) Reported amounts are attributable to common shareholders and common unitholders.

6