Kilroy Realty Executes Three of San
Francisco’s Largest Lease Transactions Over Past 12 Months
Kilroy Realty Corporation (NYSE:KRC) today said it has
signed a 10-year lease with Okta, Inc. (NASDAQ:OKTA) for
207,000 square feet of space at Kilroy Realty’s 100 First Street
office property in the South of Market district of San
Francisco.
A leading provider of identity for the enterprise, Okta is
expanding its footprint in the city in the wake of its April 2017
initial public offering and anticipated growth plans. Okta plans to
establish its new corporate headquarters at 100 First Street, with
expected occupancy occurring in phases, beginning in the second
quarter of 2018.
Okta’s lease at 100 First Street is the most recent in a series
of record-breaking deals executed by Kilroy Realty. Over the past
twelve months, the company has signed three of San Francisco’s
largest office leases that in aggregate total approximately 1.3
million square feet. In October of this year, Kilroy Realty signed
the single largest commercial lease in San Francisco history with
Dropbox totaling 736,000 square feet at The Exchange at 16th. And
in November of 2016, the company’s lease with Adobe, which totals
320,000 square feet, at 100 Hooper was recognized as “deal of the
year” by the San Francisco Business Times. Year to date, Kilroy
Realty has signed more than 2.5 million square feet of leases
throughout its stabilized and development portfolios.
“San Francisco continues to incubate some of the most dynamic
new companies in the world and we are delighted that Okta, a
thriving newly public company, has chosen to join our roster of
tenants in the city,” said John Kilroy, the Company’s Chief
Executive Officer. “I’m proud of our team for their relentless
commitment to drive our deal making machine and deliver
extraordinary leasing results with high caliber tenants, including
our recent transactions with Okta, Dropbox and Adobe.”
The success of these projects reflects Kilroy Realty’s ability
to meet the specific needs of today’s rapidly growing companies and
dynamic workforces. “Growth companies in San Francisco are looking
for unique spaces that energize and motivate their employees and
are also highly efficient. Kilroy Realty has a unique understanding
of these needs, and executes at an impressive rate to meet them,”
said Chris Roeder, International Director, JLL.
100 First Street is a 27-story, 467,000 square-foot office
building designed by Skidmore, Owings and Merrill and built in
1988. The LEED Gold and Energy Star certified property is currently
95% leased. Okta’s new 207,000 square foot lease will replace all
of Delta Dental’s 188,000 square feet of space in the building that
expires in the second quarter of 2018 as well as include an
additional 19,000 square feet.
"We're proud to call San Francisco home, and we are excited to
continue to grow our presence in the community here in partnership
with Kilroy. The new space will give the team at Okta room to
scale, build and innovate for our customers as we expand in the
coming years, all under one roof — in the heart of the city,” said
Todd McKinnon, CEO and co-founder of Okta.
About Kilroy Realty Corporation
Kilroy Realty Corporation (KRC), a publicly traded real estate
investment trust and member of the S&P MidCap 400 Index, is one
of the West Coast’s premier landlords. The company has over 70
years of experience developing, acquiring and managing office and
mixed-use real estate assets. The company provides physical work
environments that foster creativity and productivity and serves a
broad roster of dynamic, innovation-driven tenants, including
technology, entertainment, digital media and health care
companies.
At September 30, 2017, the company’s stabilized portfolio
totaled approximately 13.7 million square feet of office space
located in the coastal regions of Los Angeles, Orange County, San
Diego, the San Francisco Bay Area and Greater Seattle and 200
residential units located in the Hollywood submarket of Los
Angeles. In addition, KRC had four projects totaling approximately
1.8 million square feet of office space, 237 residential units and
96,000 square feet of retail space under construction.
The company has been recognized by GRESB as the North American
leader in office sustainability for the last four years and is
listed in the Dow Jones Sustainability World Index. At the end of
the third quarter, the company’s stabilized portfolio was 55% LEED
certified and 73% of eligible properties were ENERGY STAR
certified. More information is available at
http://www.kilroyrealty.com.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Forward-looking statements are based on our current
expectations, beliefs and assumptions, and are not guarantees of
future performance. Forward-looking statements are inherently
subject to uncertainties, risks, changes in circumstances, trends
and factors that are difficult to predict, many of which are
outside of our control. Accordingly, actual performance, results
and events may vary materially from those indicated in the
forward-looking statements, and you should not rely on the
forward-looking statements as predictions of future performance,
results or events. Numerous factors could cause actual future
performance, results and events to differ materially from those
indicated in the forward-looking statements, including, among
others: global market and general economic conditions and their
effect on our liquidity and financial conditions and those of our
tenants; adverse economic or real estate conditions generally, and
specifically, in the States of California and Washington; risks
associated with our investment in real estate assets, which are
illiquid, and with trends in the real estate industry; defaults on
or non-renewal of leases by tenants; any significant downturn in
tenants’ businesses; our ability to re-lease property at or above
current market rates; costs to comply with government regulations,
including environmental remediation; the availability of cash for
distribution and debt service and exposure to risk of default under
debt obligations; increases in interest rates and our ability to
manage interest rate exposure; the availability of financing on
attractive terms or at all, which may adversely impact our future
interest expense and our ability to pursue development,
redevelopment and acquisition opportunities and refinance existing
debt; a decline in real estate asset valuations, which may limit
our ability to dispose of assets at attractive prices or obtain or
maintain debt financing, and which may result in write offs or
impairment charges; significant competition, which may decrease the
occupancy and rental rates of properties; potential losses that may
not be covered by insurance; the ability to successfully complete
acquisitions and dispositions on announced terms; the ability to
successfully operate acquired, developed and redeveloped
properties; the ability to successfully complete development and
redevelopment projects on schedule and within budgeted amounts;
delays or refusals in obtaining all necessary zoning, land use and
other required entitlements, governmental permits and
authorizations for our development and redevelopment properties;
increases in anticipated capital expenditures, tenant improvement
and/or leasing costs; defaults on leases for land on which some of
our properties are located; adverse changes to, or implementations
of, applicable laws, regulations or legislation; risks associated
with joint venture investments, including our lack of sole
decision-making authority, our reliance on co-venturers’ financial
condition and disputes between us and our co-venturers;
environmental uncertainties and risks related to natural disasters;
and our ability to maintain our status as a REIT. These factors are
not exhaustive and additional factors could adversely affect our
business and financial performance. For a discussion of additional
factors that could materially adversely affect our business and
financial performance, see the factors included under the caption
“Risk Factors” in our annual report on Form 10-K for the year
ended December 31, 2016 and our other filings with the
Securities and Exchange Commission. All forward-looking statements
are based on currently available information, and speak only as of
the date on which they are made. We assume no obligation to update
any forward-looking statement made in this press release that
becomes untrue because of subsequent events, new information or
otherwise, except to the extent we are required to do so in
connection with our ongoing requirements under federal securities
laws.
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version on businesswire.com: http://www.businesswire.com/news/home/20171206006328/en/
Kilroy Realty CorporationTyler H. RoseExecutive Vice President
and Chief Financial Officer(310) 481-8484orMichelle NgoSenior Vice
President and Treasurer(310) 481-8581
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