10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(MARK ONE)

☑ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2020

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission file number 1-12675 (Kilroy Realty Corporation)

Commission file number 000-54005 (Kilroy Realty, L.P.)

KILROY REALTY CORPORATION

KILROY REALTY, L.P.

(Exact name of registrant as specified in its charter)

Kilroy Realty Corporation	Maryland	95-4598246
	(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
Kilroy Realty, L.P.	Delaware	95-4612685
	(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

12200 W. Olympic Boulevard, Suite 200, Los Angeles, California, 90064

(Address of principal executive offices) (Zip Code)

(310) 481-8400

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
Registrant	Title of each class	Name of each exchange on which registered	Ticker Symbol
Kilroy Realty Corporation	Common Stock, $.01 par value	New York Stock Exchange	KRC

Securities registered pursuant to Section 12(g) of the Act:

Registrant	Title of each class
Kilroy Realty, L.P.	Common Units Representing Limited Partnership Interests

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Kilroy Realty Corporation  Yes  ☒  No  ☐    Kilroy Realty, L. P.  Yes  ☒  No ☐

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act.

Kilroy Realty Corporation  Yes  ☐  No  ☒    Kilroy Realty, L. P.  Yes  ☐  No  ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. 

Kilroy Realty Corporation  Yes  ☒  No  ☐    Kilroy Realty, L. P.  Yes  ☒  No  ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    

Kilroy Realty Corporation  Yes  ☒  No  ☐    Kilroy Realty, L. P.  Yes  ☒  No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Kilroy Realty Corporation
☒	Large accelerated filer	☐	Accelerated filer	☐	Non-accelerated filer	☐	Smaller reporting company
☐	Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Kilroy Realty, L.P.
☐	Large accelerated filer	☐	Accelerated filer	☒	Non-accelerated filer	☐	Smaller reporting company
☐	Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant has filed a report on and attestation to management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.

Kilroy Realty Corporation  Yes  ☒  No  ☐    Kilroy Realty, L. P.  Yes  ☒  No  ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).    

Kilroy Realty Corporation  Yes  ☐  No  ☒    Kilroy Realty, L. P.  Yes  ☐  No  ☒

The aggregate market value of the voting and non-voting shares of common stock held by non-affiliates of Kilroy Realty Corporation was approximately $6,728,133,187 based on the quoted closing price on the New York Stock Exchange for such shares on June 30, 2020.

There is no public trading market for the common units of limited partnership interest of Kilroy Realty, L.P. As a result, the aggregate market value of the common units of limited partnership interest held by non-affiliates of Kilroy Realty, L.P. cannot be determined.

As of February 5, 2021, 116,369,096 shares of Kilroy Realty Corporation’s common stock, par value $.01 per share, were outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Kilroy Realty Corporation’s Proxy Statement with respect to its 2021 Annual Meeting of Stockholders to be filed not later than 120 days after the end of the registrant’s fiscal year are incorporated by reference into Part III of this Form 10-K.

EXPLANATORY NOTE

This report combines the annual reports on Form 10-K for the year ended December 31, 2020 of Kilroy Realty Corporation and Kilroy Realty, L.P. Unless stated otherwise or the context otherwise requires, references to “Kilroy Realty Corporation” or the “Company,” “we,” “our,” and “us” mean Kilroy Realty Corporation, a Maryland corporation, and its controlled and consolidated subsidiaries, and references to “Kilroy Realty, L.P.” or the “Operating Partnership” mean Kilroy Realty, L.P., a Delaware limited partnership, and its controlled and consolidated subsidiaries.

The Company is a real estate investment trust, or REIT, and the general partner of the Operating Partnership. As of December 31, 2020, the Company owned an approximate 99.0% common general partnership interest in the Operating Partnership. The remaining approximate 1.0% common limited partnership interests are owned by non-affiliated investors and certain directors and officers of the Company. As the sole general partner of the Operating Partnership, the Company exercises exclusive and complete discretion over the Operating Partnership’s day-to-day management and control and can cause it to enter into certain major transactions including acquisitions, dispositions, and refinancings and cause changes in its line of business, capital structure and distribution policies.

There are a few differences between the Company and the Operating Partnership that are reflected in the disclosures in this Form 10-K. We believe it is important to understand the differences between the Company and the Operating Partnership in the context of how the Company and the Operating Partnership operate as an interrelated, consolidated company. The Company is a REIT, the only material asset of which is the partnership interests it holds in the Operating Partnership. As a result, the Company generally does not conduct business itself, other than acting as the sole general partner of the Operating Partnership, issuing equity from time to time and guaranteeing certain debt of the Operating Partnership. The Company itself is not directly obligated under any indebtedness, but generally guarantees all of the debt of the Operating Partnership. The Operating Partnership owns substantially all of the assets of the Company either directly or through its subsidiaries, conducts the operations of the Company’s business and is structured as a limited partnership with no publicly-traded equity. Except for net proceeds from equity issuances by the Company, which the Company generally contributes to the Operating Partnership in exchange for units of partnership interest, the Operating Partnership generates the capital required by the Company’s business through the Operating Partnership’s operations, by the Operating Partnership’s incurrence of indebtedness or through the issuance of units of partnership interest.

Noncontrolling interests, stockholders’ equity and partners’ capital are the main areas of difference between the consolidated financial statements of the Company and those of the Operating Partnership. The common limited partnership interests in the Operating Partnership are accounted for as partners’ capital in the Operating Partnership’s financial statements and, to the extent not held by the Company, as noncontrolling interests in the Company’s financial statements. The differences between stockholders’ equity, partners’ capital and noncontrolling interests result from the differences in the equity issued by the Company and the Operating Partnership.

We believe combining the annual reports on Form 10-K of the Company and the Operating Partnership into this single report results in the following benefits:

•Combined reports better reflect how management and the analyst community view the business as a single operating unit;

•Combined reports enhance investors’ understanding of the Company and the Operating Partnership by enabling them to view the business as a whole and in the same manner as management;

•Combined reports are more efficient for the Company and the Operating Partnership and result in savings in time, effort and expense; and

•Combined reports are more efficient for investors by reducing duplicative disclosure and providing a single document for their review.

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To help investors understand the significant differences between the Company and the Operating Partnership, this report presents the following separate sections for each of the Company and the Operating Partnership:

•Item 6. Selected Financial Data – Kilroy Realty Corporation;

•Item 6. Selected Financial Data – Kilroy Realty, L.P.;

•Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations:

◦—Liquidity and Capital Resources of the Company; and

◦—Liquidity and Capital Resources of the Operating Partnership;

•consolidated financial statements;

•the following notes to the consolidated financial statements:

◦Note 8, Secured and Unsecured Debt of the Company;

◦Note 9, Secured and Unsecured Debt of the Operating Partnership;

◦Note 11, Noncontrolling Interests on the Company’s Consolidated Financial Statements;

◦Note 12, Noncontrolling Interests on the Operating Partnership’s Consolidated Financial Statements;

◦Note 13, Stockholders’ Equity of the Company;

◦Note 14, Partners’ Capital of the Operating Partnership;

◦Note 20, Net Income Available to Common Stockholders Per Share of the Company;

◦Note 21, Net Income Available to Common Unitholders Per Unit of the Operating Partnership;

◦Note 22, Supplemental Cash Flow Information of the Company;

◦Note 23, Supplemental Cash Flow Information of the Operating Partnership;

◦Note 25, Quarterly Financial Information of the Company (Unaudited); and

◦Note 26, Quarterly Financial Information of the Operating Partnership (Unaudited).

This report also includes separate sections under Item 9A. Controls and Procedures and separate Exhibit 31 and Exhibit 32 certifications for the Company and the Operating Partnership to establish that the Chief Executive Officer and the Chief Financial Officer of each entity have made the requisite certifications and that the Company and Operating Partnership are compliant with Rule 13a-15 or Rule 15d-15 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and 18 U.S.C. §1350.

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TABLE OF CONTENTS

		Page
	PART I
Item 1.	Business	5
Item 1A.	Risk Factors	16
Item 1B.	Unresolved Staff Comments	37
Item 2.	Properties	38
Item 3.	Legal Proceedings	48
Item 4.	Mine Safety Disclosures	48
	PART II
Item 5.	Market for Kilroy Realty Corporation’s Common Equity, Related Stockholder Matters and    Issuer Purchases of Equity Securities	49
	Market for Kilroy Realty, L.P.’s Common Equity, Related Stockholder Matters and Issuer    Purchases of Equity Securities	50
Item 6.	Selected Financial Data – Kilroy Realty Corporation	52
	Selected Financial Data – Kilroy Realty, L.P.	54
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	56
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	99
Item 8.	Financial Statements and Supplementary Data	100
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	100
Item 9A.	Controls and Procedures	101
Item 9B.	Other Information	105
	PART III
Item 10.	Directors, Executive Officers and Corporate Governance	105
Item 11.	Executive Compensation	105
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder    Matters	105
Item 13.	Certain Relationships and Related Transactions, and Director Independence	105
Item 14.	Principal Accountant Fees and Services	105
	PART IV
Item 15.	Exhibits and Financial Statement Schedules	106
Item 16.	Form 10-K Summary	111
	SIGNATURES	112

PART I

This document contains certain “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, including, among other things, statements or information concerning our plans, objectives, capital resources, portfolio performance, results of operations, projected future occupancy and rental rates, lease expirations, debt maturities, potential investments, strategies such as capital recycling, development and redevelopment activity, projected construction costs, projected construction commencement and completion dates, projected square footage of space that could be constructed on undeveloped land that we own, projected rentable square footage of or number of units in properties under construction or in the development pipeline, anticipated proceeds from capital recycling activity or other dispositions and anticipated dates of those activities or dispositions, projected increases in the value of properties, dispositions, future executive incentive compensation, pending, potential or proposed acquisitions, plans to grow our net operating income and funds from operations, our ability to re-lease properties at or above current market rates, anticipated market conditions, demographics and other forward-looking financial data, as well as the discussion in “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations -Factors That May Influence Future Results of Operations.” 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 or implied in the forward-looking statements, and you should not rely on the forward-looking statements as predictions of future performance, results or events. All forward-looking statements are based on information that was available and speak only as of the dates on which they were made. We assume no obligation to update any forward-looking statement 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.

In addition, this report contains information and statistics regarding, among other things, the industry, markets, submarkets and sectors in which we operate, the percentage by which certain leases are above or below applicable market rents and the number of square feet of office and other space that could be developed from specific parcels of undeveloped land. We obtained this information and these statistics from various third-party sources and our own internal estimates. We believe that these sources and estimates are reliable but have not independently verified them and cannot guarantee their accuracy or completeness.

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ITEM 1.    BUSINESS

The Company

Kilroy Realty Corporation (the “Company”) is a self-administered real estate investment trust (“REIT”) active in premier office and mixed-use 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 Greater Los Angeles, 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”). We own our interests in all of our real estate assets through Kilroy Realty, L.P. (the “Operating Partnership”) and generally conduct substantially all of our operations through the Operating Partnership.

Our stabilized portfolio of operating properties was comprised of the following properties at December 31, 2020:

	Number of Buildings	Rentable Square Feet	Number of Tenants	Percentage  Occupied (1)		Percentage Leased
Stabilized Office Properties (2)	117	14,620,166	447	91.2	%	94.3	%

________________________

(1)Represents physical and economic occupancy.

(2)Includes stabilized life science and retail space.

	Number of Properties	Number of Units	2020 Average Occupancy
Stabilized Residential Properties	2	808	72.0	%

Our stabilized portfolio includes all of our properties with the exception of development and redevelopment properties currently committed for construction, under construction, or in the tenant improvement phase, undeveloped land and real estate assets held for sale. 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 properties in the tenant improvement phase as office and life science properties that we are developing or redeveloping where the project has reached cold shell condition and is ready for tenant improvements, which may require additional major base building construction before being placed in service. Projects in the tenant improvement phase are added to our stabilized portfolio once the project reaches the earlier of 95% occupancy or one year from the date of the cessation of major base building construction activities. Costs capitalized to construction in progress for development and redevelopment properties are transferred to land and improvements, buildings and improvements, and deferred leasing costs on our consolidated balance sheets at the historical cost of the property as the projects or phases of projects are placed in service.

During the year ended December 31, 2020, we added four development projects to our stabilized portfolio consisting of 750,370 square feet of office space in San Francisco, California, 361,388 square feet of office space in Hollywood, California, 95,871 square feet of retail space and 608 residential units in San Diego, California. As of December 31, 2020, the following properties were excluded from our stabilized portfolio. We did not have any redevelopment properties or properties held for sale at December 31, 2020.

	Number of Properties/Projects	Estimated Rentable Square Feet (1)
In-process development projects - tenant improvement	3	1,080,000
In-process development projects - under construction (2)	3	856,000

________________________

(1)Estimated rentable square feet upon completion.

(2)In addition to the estimated office and life science rentable square feet noted above, development projects under construction also include 193 residential units.

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Our stabilized portfolio also excludes our future development pipeline, which as of December 31, 2020, was comprised of five future development sites, representing approximately 61 gross acres of undeveloped land.

As of December 31, 2020, 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 eight stabilized office properties, one development project in the tenant improvement phase and one future development project located in the state of Washington. All of our properties and development projects are 100% owned, excluding four office properties owned by three consolidated property partnerships. Two of the three consolidated property partnerships, 100 First Street Member, LLC (“100 First LLC”) and 303 Second Street Member, LLC (“303 Second LLC”), each owned one office property in San Francisco, California through subsidiary REITs. As of December 31, 2020, the Company owned a 56% common equity interest in both 100 First LLC and 303 Second LLC. The third consolidated property partnership, Redwood City Partners, LLC (“Redwood LLC”), owned two office properties in Redwood City, California. As of December 31, 2020, the Company owned an approximate 93% common equity interest in Redwood LLC. The remaining interests in all three property partnerships were owned by unrelated third parties.

We own our interests in all of our real estate assets through the Operating Partnership and generally conduct substantially all of our operations through the Operating Partnership, of which we owned a 99.0% common general partnership interest as of December 31, 2020. The remaining 1.0% common limited partnership interest in the Operating Partnership as of December 31, 2020 was owned by non-affiliated investors and certain of our executive officers and directors. With the exception of the Operating Partnership and our consolidated property partnerships, all of our subsidiaries are wholly-owned.

Available Information; Website Disclosure; Corporate Governance Documents

Kilroy Realty Corporation was incorporated in the state of Maryland on September 13, 1996 and Kilroy Realty, L.P. was organized in the state of Delaware on October 2, 1996. Our principal executive offices are located at 12200 W. Olympic Boulevard, Suite 200, Los Angeles, California 90064. Our telephone number at that location is (310) 481-8400. Our website is www.kilroyrealty.com. The information found on, or otherwise accessible through, our website is not incorporated into, and does not form a part of, this annual report on Form 10-K or any other report or document we file with or furnish to the SEC. All reports we will file with the SEC are available free of charge via EDGAR through the SEC website at www.sec.gov. All reports that we will file with the SEC will also be available free of charge on our website at www.kilroyrealty.com as soon as reasonably practicable after we file those materials with, or furnish them to, the SEC.

The following documents relating to corporate governance are also available on our website under “Investors —Overview —Governance Documents” and available in print to any security holder upon request:

•Corporate Governance Guidelines;

•Code of Business Conduct and Ethics;

•Audit Committee Charter;

•Executive Compensation Committee Charter;

•Nominating / Corporate Governance Committee Charter; and

•Corporate Social Responsibility and Sustainability Committee Charter.

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You may request copies of any of these documents by writing to:

Attention: Investor Relations

Kilroy Realty Corporation

12200 West Olympic Boulevard, Suite 200

Los Angeles, California 90064

We intend to disclose on our website under “Investors —Overview —Governance Documents” any amendment to, or waiver of, any provisions of our Code of Business Conduct and Ethics applicable to the directors and/or officers of the Company that would otherwise be required to be disclosed under the rules of the Securities and Exchange Commission or the New York Stock Exchange.

Business and Growth Strategies

Growth Strategies.    We believe that a number of factors and strategies will enable us to continue to achieve our objectives of long-term sustainable growth in Net Operating Income (defined below) and FFO (defined below) as well as maximization of long-term stockholder value. These factors and strategies include:

•the quality, geographic location, physical characteristics and operating sustainability of our properties;

•our ability to efficiently manage our assets as a low cost provider of commercial real estate through our seasoned management team possessing core capabilities in all aspects of real estate ownership, including property management, leasing, marketing, financing, accounting, legal, and construction and development management;

•our access to development, redevelopment, acquisition and leasing opportunities as a result of our extensive experience and significant working relationships with major West Coast property owners, corporate tenants, municipalities and landowners given our over 70-year presence in the West Coast markets;

•our active development program and our future development pipeline of undeveloped land sites (see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations —Factors That May Influence Future Results of Operations” for additional information pertaining to the Company’s in-process and future development pipeline);

•our capital recycling program (see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations —Liquidity and Capital Resources of the Operating Partnership” for additional information pertaining to the Company’s capital recycling program and related property and land dispositions);

•our ability to capitalize on inflection points in a real estate cycle to add quality assets to our portfolio at substantial discounts to long-term value, through either acquisition, development or redevelopment; and

•our strong financial position that has and will continue to allow us to pursue attractive acquisition and development and redevelopment opportunities.

“Net Operating Income” subsequent to the adoption of Financial Standards Accounting Board Accounting Standards Codification Topic 842 (“Topic 842”) on January 1, 2019 is defined as consolidated operating revenues (rental income and other property income) less consolidated operating expenses (property expenses, real estate taxes and ground leases). Prior to the adoption of Topic 842 we defined Net Operating Income as consolidated operating revenues (rental income, tenant reimbursements and other property income) less consolidated operating expenses (property expenses, real estate taxes, provision for bad debts and ground leases). “FFO” is Funds From Operations available to common stockholders and common unitholders calculated in accordance with the 2018 Restated White Paper on FFO approved by the Board of Governors of the National Association of Real Estate Investment Trusts (“NAREIT”). (See “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations —Results of Operations” and “—Non-GAAP Supplemental Financial Measures: Funds From

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Operations” for a reconciliation of these measures to generally accepted accounting principles (“GAAP”) net income available to common stockholders.)

Operating Strategies.    We focus on enhancing long-term growth in Net Operating Income and FFO from our properties by:

•maximizing cash flow from our properties through active leasing, early renewals and effective property management;

•structuring leases to maximize returns;

•managing portfolio credit risk through effective underwriting, including the use of credit enhancements and interests in collateral to mitigate portfolio credit risk;

•managing operating expenses through the efficient use of internal property management, leasing, marketing, financing, accounting, legal, and construction and development management functions;

•maintaining and developing long-term relationships with a diverse tenant base;

•continuing to effectively manage capital improvements to enhance our properties’ competitive advantages in their respective markets and improve the efficiency of building systems;

•continuing to expand our management team with individuals who have extensive regional and product-type experience and are highly knowledgeable in their respective markets and product types; and

•attracting and retaining motivated employees by providing financial and other incentives to meet our operating and financial goals.

Development and Redevelopment Strategies.    We and our predecessors have developed office properties primarily located in California since 1947. As of December 31, 2020, we had three projects in the tenant improvement phase totaling approximately 1,080,000 square feet of office space and three projects under construction totaling approximately 856,000 square feet of office and life science space and 193 residential units. In addition, our future development pipeline was comprised of five potential development sites representing approximately 61 gross acres of undeveloped land on which we believe we have the potential to develop over 6.0 million square feet of office, life science, laboratory, residential and retail space, depending upon economic conditions. Our strategy with respect to development is to:

•own land sites in highly populated, amenity rich locations that are attractive to a broad array of tenants;

•be the premier provider of modern and collaborative office, life science and mixed-use projects on the West Coast with a focus on design and environment;

•maintain a disciplined approach by commencing development when appropriate based on market conditions, focusing on leasing, developing in stages or phasing, and cost control;

•reinvest capital from dispositions of selective assets into new state-of-the-art development and acquisition opportunities with higher cash flow and rates of return or future redevelopment when possible;

•execute on our development projects under construction and future development pipeline, including expanding entitlements; and

•evaluate redevelopment opportunities in supply-constrained markets because such efforts generally achieve similar returns to new development with reduced entitlement risk and shorter construction periods.

We may engage in the additional development or redevelopment of office, life science and mixed-use properties when market conditions support a favorable risk-adjusted return on such development or redevelopment. We expect

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that our significant working relationships with tenants, municipalities and landowners on the West Coast will give us further access to development and redevelopment opportunities. We cannot ensure that we will be able to successfully develop or redevelop any of our properties or that we will have access to additional development or redevelopment opportunities.

Acquisition Strategies.    We believe we are well positioned to acquire opportunistic properties and development and redevelopment opportunities as the result of our extensive experience, strong financial position and ability to access capital. We continue to focus on growth opportunities in West Coast markets populated by knowledge and creative based tenants in a variety of industries, including technology, media, healthcare, life sciences, entertainment and professional services. Against the backdrop of market volatility, we expect to manage a strong balance sheet, execute on our development program and selectively evaluate opportunities that add immediate Net Operating Income to our portfolio or play a strategic role in our future growth and that:

•provide attractive yields and significant potential for growth in cash flow from property operations;

•present growth opportunities in our existing or other strategic markets; and

•demonstrate the potential for improved performance through intensive management, repositioning, capital investment and leasing that should result in increased occupancy and rental revenues.

Financing Strategies.    Our financing policies and objectives are determined by our board of directors. Our goal is to limit our dependence on leverage and maintain a conservative ratio of debt-to-total market capitalization. As of December 31, 2020, our total debt as a percentage of total market capitalization was 37.0%, which was calculated based on the quoted closing price per share of the Company’s common stock of $57.40 on December 31, 2020 (see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations —Liquidity and Capital Resources of the Company —Capitalization” for additional information). Our financing strategies include:

•maintaining financial flexibility, including a low secured to unsecured debt ratio;

•maximizing our ability to access a variety of both public and private capital sources;

•maintaining a staggered debt maturity schedule in which the maturity dates of our debt are spread over several years to limit risk exposure at any particular point in the capital and credit market cycles;

•completing financing in advance of the need for capital;

•managing interest rate exposure by generally maintaining a greater amount of fixed-rate debt as compared to variable-rate debt; and

•maintaining our credit ratings.

We utilize multiple sources of capital, including borrowings under our unsecured revolving credit facility, proceeds from the issuance of public or private debt or equity securities and other bank and/or institutional borrowings and our capital recycling program, including strategic venture sources. There can be no assurance that we will be able to obtain capital as needed on terms favorable to us or at all. (See the discussion under the caption “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations —Factors That May Influence Future Results of Operations” and “Item 1A. Risk Factors.”)

Sustainability Strategies. Our longstanding leadership in sustainability in real estate is globally recognized, and we achieved carbon neutral operations before year-end 2020 per the commitment we made in 2018 to achieve this goal. Our vision is a resilient portfolio that minimizes the environmental impact of the development and operation of our buildings while maximizing the health and productivity of our tenants, employees and communities as well as our financial returns. Management and our board of directors, through the Corporate Social Responsibility and Sustainability Committee (the “Committee”) established in April 2018, oversee and advance the Company’s corporate social responsibility and sustainability initiatives. They recognize that community

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engagement and sustainable operations benefit all of our constituencies and are key to preserving our Company’s value and credibility.

As a result of our commitment to sustainability, we have been ranked first in sustainability performance in North America in the Listed Office category by the Global Real Estate Sustainability Benchmark (“GRESB”) seven times and have also earned the highly competitive GRESB “Green Star” designation in each of the last eight years for ranking in the top 25% of companies worldwide in sustainability performance. GRESB also named us the Global Sector Leader in Listed Office and Listed Office Development in 2020. We have been recognized with the US EPA ENERGY STAR® Partner of the Year Sustained Excellence Award for the last six years, NAREIT’s Leader in the Light Award in the Listed Office category for the last seven years and NAREIT’s Leader in the Light Most Innovative award in 2018 and 2020. We have also been included on Newsweek’s list of America’s Most Responsible Companies for the past two years. For excellence in creating a diverse, equitable and inclusive culture, we are listed on the Bloomberg Gender Equality Index, which measures companies on female leadership and talent pipeline, equal pay and gender pay parity, inclusive culture, sexual harassment policies and pro-women brand.

We manage our properties to offer the maximum degree of utility and operational efficiency to our tenants. We offer tenant sustainability programs focused on helping our tenants reduce their energy and water consumption and increase their recycling diversion rates. We incorporate green lease language into 100% of our new leases, including a cost recovery clause for resource-efficiency related capital expenditures in full-service gross leases, which seek to align tenant and landlord interests on energy, water and waste efficiency. Green leases (also known as aligned leases, high performance leases or energy efficient leases) aim to align the financial and energy incentives of building owners and tenants so they can work together to save money, conserve resources and ensure the efficient operation of buildings. We have won the Institute for Market Transformation’s (“IMT’s”) Green Lease Leaders award five times. Energy consumption, water consumption, and greenhouse gas (“GHG”) emissions data for the periods indicated based on the most recent available information, in process of assurance by DNV GL Business Assurance USA, Inc., are as follows:

Energy consumption:*

Year (1)	Energy Consumption Data Coverage as % of Total Floor Area (2)		Total Energy Consumed by Floor Area with Data Coverage (MWh) (3)	% of Energy Generated From Renewable Sources (4)		Like-for-Like Change in Energy Consumption of Floor Area with Data Coverage (5)		% of Eligible Portfolio that has Obtained an Energy Rating and is Certified to ENERGY STAR (6)
2019	99	%	287,100	18	%	(2)	%	70	%
2018	98	%	310,592	13	%	(2)	%	77	%
2017	96	%	309,248	5	%	(1)	%	73	%

Water consumption:*

Year (1)	Water Withdrawal Data Coverage as a % of Total Floor Area (7)		Total Water Withdrawn by Portfolio (m3) (8)	Like-for-like Change in Water Withdrawn for Floor Area with Data Coverage (5)
2019	98	%	833,493	(2)	%
2018	96	%	941,348	5	%
2017	98	%	960,920	—	%

GHG Emissions:*

Year (1)	Scope 1 GHG Data Coverage as a % of Total Floor Area (9)		Scope 1 GHG Emissions (Tonnes CO2) (10)	Like-for-like Change in Scope 1 GHG Emissions Data (5)
2019	100	%	3,082	6	%
2018	99	%	3,145	(4)	%
2017	100	%	4,120	6	%

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Year (1)	Scope 2 Location-Based GHG Data Coverage as a % of Total Floor Area (11)		Scope 2 Location-Based GHG Emissions (Tonnes CO2) (12)	Like-for-like Change in Scope 2 Location-Based GHG Emissions Data (5)
2019	100	%	25,438	(5)	%
2018	99	%	29,844	(6)	%
2017	99	%	36,504	(10)	%

Year (1)	Scope 2 Market-Based GHG Data Coverage as a % of Total Floor Area (11)		Scope 2 Market-Based GHG Emissions (Tonnes CO2) (12)	Like-for-like Change in Scope 2 Market-Based GHG Emissions Data (5)
2019	100	%	24,718	(8)	%
2018	99	%	29,844	(12)	%
2017	99	%	35,375	N/A

_____________________

*DNV GL Business Assurance USA, Inc. is in the process of completing a Type 2, moderate level assurance assessment, using the AA1000AS (2008) assurance standard to assure the content of our sustainability report, including energy consumption, water consumption and GHG emissions data. GHG emissions reporting follows the World Business Council for Sustainable Development (WBSCD)/World Resources Institute (WRI) Greenhouse Gas Protocol. However, DNV GL Business Assurance USA, Inc. has yet to complete its procedures with respect to such assessment and, as such, our final energy consumption, water consumption and GHG emissions data may differ from the data set forth above.

(1)Full 2020 calendar year energy, water and GHG emissions data is not available until after March 30, 2021.

(2)Percentage based on gross square footage of portfolio floor area with complete energy consumption data coverage as of the end of the applicable year. Floor area is considered to have complete energy consumption data coverage when energy consumption data (i.e., energy types and amounts consumed) is obtained by the Company for all types of energy consumed in the relevant floor area during the fiscal year, regardless of when such data was obtained.

(3)Energy includes energy purchased from sources external to the Company and its tenants or produced by the Company or its tenants themselves (self-generated) and energy from all sources, including direct fuel usage, purchased electricity, and heating, cooling and steam energy. Total energy consumption based on floor area with complete energy consumption data coverage as of the end of the applicable year.

(4)Renewable sources include renewable energy the Company directly produced and renewable energy the Company purchased if purchased through a renewable power purchase agreement that explicitly includes renewable energy certificates (“RECs”) or Guarantees of Origin (“GOs”), a Green-e Energy Certified utility or supplier program or other green power products that explicitly include RECs or GOs or for which Green-e Energy Certified RECs are paired with grid electricity. Percentage is based total energy consumption during the applicable year.

(5)Data reported on a like-for-like comparison excludes assets that have been acquired or disposed over the past twenty-four months as of the end of the applicable year.

(6)Eligible portfolio represents our office and residential properties that have had 50% or greater occupancy for 12 consecutive months at any point during the applicable year. Percentage is based on rentable square footage of our eligible portfolio that has obtained an energy rating and is certified to ENERGY STAR® as of the end of the applicable year.

(7)Percentage based on gross square footage of portfolio floor area with complete water withdrawal data coverage as of the end of the applicable year. Floor area is considered to have complete water withdrawal data coverage when water withdrawal data (i.e., amounts withdrawn) is obtained by the Company for the relevant floor area during the fiscal year, regardless of when such data was obtained.

(8)Water sources include surface water (including water from wetlands, rivers, lakes and oceans), groundwater, rainwater collected directly and stored by the Company, wastewater obtained from other entities, municipal water supplies or supply from other water utilities. Total water withdrawal based on floor area with complete water withdrawal data coverage as of the end of the applicable year.

(9)Percentage based on gross square footage of portfolio floor area with complete Scope 1 GHG emissions data coverage as of the end of the applicable year. Floor area is considered to have complete Scope 1 GHG emissions data coverage when GHG emission data (i.e., amounts emitted) is obtained by the Company for the relevant floor area during the fiscal year, regardless of when such data was obtained.

(10)Scope 1 emissions represent those produced by consuming onsite natural gas procured by the Company.

(11)Percentage based on gross square footage of portfolio floor area with complete Scope 2 GHG emissions data coverage as of the end of the applicable year. Floor area is considered to have complete Scope 2 GHG emissions data coverage when GHG emission data is obtained by the Company for the relevant floor area during the fiscal year, regardless of when such data was obtained.

(12)Scope 2 emissions represent those produced by consuming onsite electricity procured by the Company.

We build our current development projects to Leadership in Energy and Environmental Design (“LEED”) specifications. All of our office development projects are designed to achieve LEED certification, either LEED Platinum or Gold.

We are actively pursuing LEED certification for approximately 856,000 square feet of office and life science space under construction. In addition, an analysis of energy and water performance is included in our standard due

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diligence process for acquisitions, and reducing energy use year over year is a comprehensive goal of our operational strategy. This is accomplished through systematic energy auditing, mechanical, lighting and other building upgrades, optimizing operations and engaging tenants. During the past few years, we have significantly enhanced the sustainability profile of our portfolio, ending 2020 with 68% of our properties LEED certified, 69% of our eligible stabilized office properties ENERGY STAR certified and 100% of our eligible stabilized residential properties ENERGY STAR certified (in each case as a percentage of our total or eligible rentable square feet as of December 31, 2020).

We identify climate change as a risk to our Company, its tenants and our other stakeholders, an opportunity for long-term value creation and a key driver in long-term strategic business decisions. These risks and opportunities include transitional risks such as policy, market, technology and reputational concerns, as well as physical risks, and are a focus area for the board of directors and management.  Climate-related risks and opportunities are governed by the board of directors through the Committee. In 2018, the Committee endorsed the recommendations of the Task Force on Climate-related Financial Disclosure (TCFD) and tasked management with assessing and reporting against climate related risk for the Company. Recognizing the importance of reducing the Company’s greenhouse gas impact on the environment, in 2018 we committed to achieving carbon neutral operations by December 31, 2020, and we achieved this goal. This means that the entirety of our scope 1 and scope 2 emissions is offset through a combination of energy efficiency measures and both onsite and offsite renewables. This exceeds our carbon reduction goals previously validated by Science-Based Targets. Science-Based Targets is a collaboration between the Carbon Disclosure Project, the United Nations Global Compact, the World Resources Institute and the World Wide Fund for Nature, which independently assesses and approves the carbon reduction goals of companies.

Significant Tenants

As of December 31, 2020, our 15 largest tenants in terms of annualized base rental revenues represented approximately 49.1% of our total annualized base rental revenues, defined as annualized monthly contractual rents from existing tenants as of December 31, 2020. Annualized base rental revenue includes the impact of straight-lining rent escalations and the amortization of free rent periods and excludes the impact of the following: amortization of deferred revenue related tenant-funded tenant improvements, amortization of above/below market rents, amortization for lease incentives due under existing leases and expense reimbursement revenue.

For further information on our 15 largest tenants and the composition of our tenant base, see “Item 2. Properties —Significant Tenants.”

Competition

We compete with several developers, owners, operators and acquirers of office and life science, undeveloped land and other commercial real estate, including mixed-use and residential real estate, many of which own properties similar to ours in the same submarkets in which our properties are located. For further discussion of the potential impact of competitive conditions on our business, see “Item 1A. Risk Factors.”

Segment and Geographic Financial Information

During 2020 and 2019, we had one reportable segment, our office and life science properties segment. For information about our office property revenues and long-lived assets and other financial information, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations —Results of Operations.”

As of December 31, 2020, 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 eight stabilized office properties, one development project in the tenant improvement phase and one future development project located in the state of Washington. As of December 31, 2020, all of our properties and development projects were 100% owned, excluding four office properties owned by three consolidated property partnerships.

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Human Capital Resources

As of December 31, 2020, we employed 252 people through the Operating Partnership, Kilroy Services, LLC, and Kilroy Realty TRS, Inc. We believe that relations with our employees are good.

Our human capital development goals and initiatives are focused on enhancing employee growth, satisfaction and wellness while maintaining a diverse and thriving culture. Several of our human capital development initiatives include the following:

Diversity. We are committed to cultivating a diverse culture of inclusion that makes a positive difference in our employees’ lives and have developed targeted training to improve workplace diversity, equity and inclusion. As of December 31, 2020, our employees were:

•59% female; 41% male

•45% ethnically diverse (i.e., Asian, African American, Hispanic or Latino and other (Native Hawaiian/Pacific Islander and two or more))

Training and Education. We support the continual development of our employees through various training and education programs throughout their tenure at the Company, from onboarding to skill building to leadership development. We also conduct annual performance and career development reviews for all employees.

Employee Health. The physical and mental health and wellness of our employees is of central importance to our culture. We evaluate our group health and ancillary benefits annually to ensure our benefits package is robust and conduct an annual wellness and satisfaction survey to help us better tailor our employee health and wellness programs.

Strong Communities and Healthy Planet. We are deeply aware that our buildings are part of the larger community and that we thrive when the communities around us thrive. We are proud to make these communities better places to live and work through our volunteerism and philanthropy initiatives.

Fostering Company Culture and Providing Support to Employees During COVID-19 Pandemic. In accordance with local and state government guidance and social distancing recommendations, almost all of our corporate employees have worked remotely since March 2020. To protect and foster the Company’s culture during the COVID-19 pandemic, we formed an inter-regional and inter-departmental taskforce that organized challenges, surveys, virtual events and other remote programming to keep our employees connected while working from home. See “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations —Overview and Background—COVID-19 Response.”

Our compensation program is designed to, among other things, attract, retain and incentivize talented and experienced individuals in the highly competitive West Coast employment and commercial real estate markets. We use a mix of competitive salaries and other benefits to attract and retain these individuals.

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Environmental Regulations and Potential Liabilities

Government Regulations Relating to the Environment.    Many laws and governmental regulations relating to the environment are applicable to our properties, and changes in these laws and regulations, or their interpretation by agencies and the courts, occur frequently and may adversely affect us.

Existing conditions at some of our properties.    Independent environmental consultants have conducted Phase I or similar environmental site assessments on all of our properties. We generally obtain these assessments prior to the acquisition of a property and may later update them as required for subsequent financing of the property, if a property is slated for disposition, or as requested by a tenant. Consultants are required to perform Phase I assessments to American Society for Testing and Materials standards then-existing for Phase I site assessments and typically include a historical review, a public records review, a visual inspection of the surveyed site, and the issuance of a written report. These assessments do not generally include any soil or groundwater sampling or subsurface investigations; however, if a Phase I does recommend that soil or groundwater samples be taken or other subsurface investigations take place, we generally perform such recommended actions. Depending on the age of the property, the Phase I may have included an assessment of asbestos-containing materials or a separate hazardous materials survey may have been conducted. For properties where asbestos-containing materials were identified or suspected, an operations and maintenance plan was generally prepared and implemented.

Historical operations at or near some of our properties, including the presence of underground or above ground storage tanks, various sites uses that involved hazardous substances, the landfilling of hazardous substances and solid waste, and migration of contamination from other sites, may have caused soil or groundwater contamination. In some instances, the prior owners of the affected properties conducted remediation of known contamination in the soils on our properties, we are required to conduct further environmental clean-up and environmental closure activities at certain properties, and residual contamination could pose environmental, health, and safety risks if not appropriately addressed. We may need to investigate or remediate contaminated soil, soil gas, landfill gas, and groundwater, and we may also need to conduct landfill closure and post-closure activities, including, for example, the implementation of groundwater and methane monitoring systems and impervious cover, and the costs of such work could exceed projected or budgeted amounts. To protect the health and safety of site occupants and others, we may be required to implement and operate safeguards, including, for example, vapor intrusion mitigation systems and building protection systems to address methane. We may need to modify our methods of construction or face increased construction costs as a result of environmental conditions, and we may face obligations under agreements with governmental authorities with respect to the management of such environmental conditions. If releases from our sites migrate offsite, or if our site redevelopment activities cause or contribute to a migration of hazardous substances, neighbors or others could make claims against us, such as for property damage, personal injury, or cost recovery.

As of December 31, 2020, we had accrued environmental remediation liabilities of approximately $71.3 million recorded on our consolidated balance sheets in connection with certain of our in-process and future development projects. The accrued environmental remediation liabilities represent the remaining costs we estimate we will incur prior to and during the development process at various development acquisition sites. These estimates, which we developed with the assistance of third party experts, consist primarily of the removal of contaminated soil, performing environmental closure activities, constructing remedial systems and other related costs since we are required to dispose of any existing contaminated soil, and sometimes perform other environmental closure or remedial activities, when we develop new buildings at these sites. It is possible that we could incur additional environmental remediation costs in connection with these development projects.  However, potential additional environmental costs cannot be reasonably estimated at this time and certain changes in estimates could occur as the site conditions, final project timing, design elements, actual soil conditions and other aspects of the projects, which may depend upon municipal and other approvals beyond the control of the Company, are determined. See Note 18 “Commitments and Contingencies” to our consolidated financial statements included in this report for additional information.

Other than the accrued environmental liabilities recorded in connection with certain of our development projects, we are not aware of any such condition, liability, or concern by any other means that would give rise to material environmental liabilities. However, our assessments may have failed to reveal all environmental conditions, liabilities, or compliance concerns; there may be material environmental conditions, liabilities, or

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compliance concerns that arose at a property after the review was completed; future laws, ordinances, or regulations may impose material additional environmental liability; and environmental conditions at our properties may be affected in the future by tenants, third parties, or the condition of land or operations near our properties, such as the presence of underground storage tanks or migrating plumes. We cannot be certain that costs of future environmental compliance will not have an adverse effect on our financial condition, results of operations, cash flow, the quoted trading price of our securities, and our ability to satisfy our debt service obligations and to pay dividends and distributions to security holders.

Use of hazardous materials by some of our tenants.    Some of our tenants handle hazardous substances and wastes on our properties as part of their routine operations. Environmental laws and regulations may subject these tenants, and potentially us, to liability resulting from such activities. We generally require our tenants in their leases to comply with these environmental laws and regulations and to indemnify us for any related liabilities. As of December 31, 2020, other than routine cleaning materials and chemicals used in routine office operations, approximately 4-6% of our tenants handled hazardous substances and/or wastes on approximately 1-3% of the aggregate square footage of our properties as part of their business operations. These tenants are primarily involved in the life sciences business. The hazardous substances and wastes are primarily comprised of diesel fuel for emergency generators and small quantities of lab and light manufacturing chemicals including, but not limited to, alcohol, ammonia, carbon dioxide, cryogenic gases, dichlorophenol, methane, naturalyte acid, nitrogen, nitrous oxide, and oxygen which are routinely used by life science companies. We are not aware of any material noncompliance, liability, or claim relating to hazardous or toxic substances or petroleum products in connection with any of our properties, and management does not believe that on-going activities by our tenants will have a material adverse effect on our operations.

Costs related to government regulation and private litigation over environmental matters.    Under applicable environmental laws and regulations, we may be liable for the costs of removal, remediation, or disposal of certain hazardous or toxic substances present or released on our properties. These laws could impose liability without regard to whether we are responsible for, or even knew of, the presence or release of the hazardous materials. Government investigations and remediation actions may have substantial costs, and the presence or release of hazardous substances on a property could result in governmental clean-up actions, personal injury actions, or similar claims by private plaintiffs.

Potential environmental liabilities may exceed our environmental insurance coverage limits, transactional indemnities or holdbacks.    We carry what we believe to be commercially reasonable environmental insurance. Our environmental insurance policies are subject to various terms, conditions and exclusions. Similarly, in connection with some transactions we obtain environmental indemnities and holdbacks that may not be honored by the indemnitors, may be less than the resulting liabilities or may otherwise fail to address the liabilities adequately. Therefore, we cannot provide any assurance that our insurance coverage or transactional indemnities will be sufficient or that our liability, if any, will not have a material adverse effect on our financial condition, results of operations, cash flows, quoted trading price of our securities, and our ability to satisfy our debt service obligations and to pay dividends and distributions to security holders.

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SUMMARY RISK FACTORS

The following section sets forth a summary of material factors that may adversely affect our business and operations. For a more extensive discussion of these factors, see “1A. Risk Factors” contained in this report.

•The ongoing COVID-19 pandemic, and restrictions intended to prevent its spread, could adversely impact our business, financial condition, results of operations, cash flows, liquidity and ability to satisfy our debt service obligations and to pay dividends and distributions to security holders.

•Global market, economic and geopolitical conditions may adversely affect our business, results of operations, liquidity and financial condition and those of our tenants.

•All of our properties are located in California and greater Seattle, Washington and we may therefore be susceptible to adverse economic conditions and regulations, as well as natural disasters, in those areas.

•Our performance and the market value of our securities are subject to risks associated with our investments in real estate assets and with trends in the real estate industry.

•We depend upon significant tenants, and the loss of a significant tenant could adversely affect our financial condition, results of operations, ability to borrow funds and cash flows.

•Downturns in tenants’ businesses may reduce our revenues and cash flows.

•A large percentage of our tenants operate in a concentrated group of industries and downturns in these industries could adversely affect our financial condition, results of operations and cash flows.

•We may be unable to renew leases or re-lease available space.

•We are subject to governmental regulations that may affect the development, redevelopment and use of our properties.

•We may not be able to meet our debt service obligations.

•The covenants in the agreements governing the Operating Partnership’s unsecured revolving credit facility, unsecured term loan facility and note purchase agreements may limit our ability to make distributions to the holders of our common stock.

•A downgrade in our credit ratings could materially adversely affect our business and financial condition.

•We face significant competition, which may decrease the occupancy and rental rates of our properties.

•In order to maintain the quality of our properties and successfully compete against other properties, we must periodically spend money to maintain, repair and renovate our properties, which reduces our cash flows.

•Potential casualty losses, such as earthquake losses, may adversely affect our financial condition, results of operations and cash flows.

•We may be unable to complete acquisitions and successfully operate acquired properties.

•There are significant risks associated with property acquisition, development and redevelopment.

•Joint venture investments could be adversely affected by our lack of sole decision-making authority, our reliance on co-venturers’ financial condition, and disputes between us and our co-venturers and could expose us to potential liabilities and losses.

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•We own certain properties subject to ground leases and other restrictive agreements that limit our uses of the properties, restrict our ability to sell or otherwise transfer the properties and expose us to the loss of the properties if such agreements are breached by us, terminated or not renewed.

•We may invest in securities related to real estate, which could adversely affect our ability to pay dividends and distributions to our security holders.

•We face risks associated with security breaches through cyber attacks, cyber intrusions or otherwise, as well as other significant disruptions of our information technology (IT) networks and related systems.

•An increase in interest rates could increase our interest costs on variable rate debt and new debt and could adversely affect our ability to refinance existing debt, conduct development, redevelopment and acquisition activity and recycle capital.

•The actual density of our undeveloped land holdings and/or any particular land parcel may not be consistent with our potential density estimates.

•Loss of our key personnel could harm our operations and financial performance and adversely affect the quoted trading price of our securities.

•Our growth depends on external sources of capital that are outside of our control and the inability to obtain capital on terms that are acceptable to us, or at all, could adversely affect our financial condition and results of operations.

•The Chairman of our board of directors and Chief Executive Officer has substantial influence over our affairs.

•Loss of the Company’s REIT status would have significant adverse consequences to us and the value of the Company’s common stock.

ITEM 1A.    RISK FACTORS

The following section sets forth material factors that may adversely affect our business and operations. The following factors, as well as the factors discussed in “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations —Factors That May Influence Future Results of Operations” and other information contained in this report, should be considered in evaluating us and our business.

Risks Related to our Business and Operations

The ongoing COVID-19 pandemic, and restrictions intended to prevent its spread, could adversely impact our business, financial condition, results of operations, cash flows, liquidity and ability to satisfy our debt service obligations and to pay dividends and distributions to security holders. The ongoing COVID-19 pandemic which continues to evolve, and restrictions intended to prevent its spread, have impacted the markets in which we conduct our business and where our tenants are located. All the states where we own properties and/or have development projects (i.e., California and Washington) initially reacted to the COVID-19 pandemic by instituting quarantines, restrictions on travel, “shelter in place” rules, stay-at-home orders, density limitations, social distancing measures, restrictions on types of business that may continue to operate and/or restrictions on types of construction projects that may continue. Although some state governments and other authorities were in varying stages of lifting or modifying some of these measures, all the states where we own properties and/or have development projects have been forced to reinstitute these measures and may, in the future, impose new, more restrictive measures, if the risks, or the perception of the risks, related to the COVID-19 pandemic worsen at any time. Furthermore, although in certain cases, exceptions are available for essential retail, research and laboratory activities, essential building services, such as cleaning and maintenance, and certain essential construction projects, there can be no assurance that such exceptions will enable us to avoid adverse impacts on our business, financial condition, results of operations, cash flows, liquidity and ability to satisfy our debt service obligations and to pay dividends and distributions to security holders. For instance, some of the activities of our parking, retail space and co-working tenants are not covered by the exceptions listed above, and we have seen weakness and a material reduction in rent

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collections from these tenants that may continue for an indeterminate period pending a cessation of the adverse impacts from the COVID-19 pandemic, and restrictions intended to prevent its spread. In addition, there can be no assurance as to how long restrictions intended to prevent the spread of COVID-19 may remain in place in the states and cities where we own properties, and even if such restrictions are lifted, they may be reinstituted at a later date. If such restrictions remain in place for an extended period of time, we may experience further reductions in rents from our tenants.

Across all property types, we collected approximately 97% of our total gross rent billings for the year ended December 31, 2020, including 100% from all of our top 15 tenants and as of February 1, 2021, we had collected 95% of our January 2021 total gross rent billings, including 100% from all of our top 15 tenants. Although we are and will continue to be actively engaged in rent collection efforts related to uncollected rent, as well as working with certain tenants who have requested rent deferrals (particularly those occupying retail space), we can provide no assurance that such efforts or our efforts in future periods will be successful. In addition, we are and will continue to be actively engaged in discussions with certain tenants regarding the adverse impacts of the COVID-19 pandemic, and restrictions intended to prevent its spread, and may afford certain additional accommodations.

In addition, we may be required to continue to comply with “social distancing” at our properties and development projects and we may be subject to certain conditions, including requiring contractors to develop COVID-19 control, mitigation, and recovery plans and satisfy certain requirements before work can continue or commence, which may increase costs, perhaps substantially. We expect to comply with any state or local requirements. Our development projects could in the future be affected by moratoriums on construction. To the extent any city issues a moratorium, we may be subject to such a moratorium unless the applicable state or city grants an exclusion for these projects because certain of our development projects may qualify as essential construction projects.

The ongoing COVID-19 pandemic, and restrictions intended to prevent its spread, could have significant adverse impacts on our business, financial condition, results of operations, cash flows, liquidity and ability to satisfy our debt service obligations and to pay dividends and distributions to security holders in a variety of ways that are difficult to predict. Such adverse impacts could depend on, among other factors:

•the financial condition of our tenants - many of which are in the technology, media, healthcare, life sciences, entertainment and professional services industries - and their ability or willingness to pay rent in full on a timely basis;

•state, local, federal and industry-initiated efforts that may adversely affect landlords, including us, and their ability to collect rent and/or enforce remedies for the failure to pay rent;

•our need to defer or forgive rent and restructure leases with our tenants and our ability to do so on favorable terms or at all;

•significant job losses in the industries of our tenants, which may decrease demand for our office and retail space, causing market rental rates and property values to be negatively impacted;

•our ability to stabilize or lease-up our development projects, renew leases or re-lease available space in our proprieties on favorable terms or at all, including as a result of a general decrease in demand for our office and retail space, deterioration in the economic and market conditions in the markets in which we own properties or due to restrictions intended to prevent the spread of COVID-19 that frustrate our leasing activities;

•a severe and prolonged disruption and instability in the global financial markets, including the debt and equity capital markets, all of which have already experienced and may continue to experience significant volatility, or deterioration in credit and financing conditions, may affect our or our tenants’ ability to access capital necessary to fund our respective business operations or replace or renew maturing liabilities on a timely basis, on attractive terms or at all and may adversely affect the valuation of financial assets and liabilities, any of which could affect our and our tenants’ ability to meet liquidity and capital expenditure requirements;

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•a refusal or failure of one or more lenders under our revolving credit facility to fund their respective financing commitments to us may affect our ability to access capital necessary to fund our business operations and to meet our liquidity and capital expenditure requirements;

•the ability of potential buyers of properties identified for potential future capital recycling transactions to obtain debt financing, which has been and may continue to be constrained for some potential buyers;

•a reduction in the values of our properties that could result in impairments or limit our ability to dispose of them at attractive prices or obtain debt financing secured by our properties;

•complete or partial shutdowns of one or more of our tenants’ manufacturing facilities or distribution centers, temporary or long-term disruptions in our tenants’ supply chains from local, national and international suppliers or delays in the delivery of products, services or other materials necessary for our tenants’ operations, which could force our tenants to reduce, delay or eliminate offerings of their products and services, reduce or eliminate their revenues and liquidity and/or result in their bankruptcy or insolvency;

•our ability to avoid delays or cost increases associated with building materials or construction services necessary for construction that could adversely impact our ability to continue or complete construction as planned, on budget or at all;

•our and our tenants’ ability to manage our respective businesses to the extent our and their management or personnel are impacted in significant numbers by the COVID-19 pandemic and are not willing, available or allowed to conduct work; and

•our and our tenants’ ability to ensure business continuity in the event our continuity of operations plan is not effective or improperly implemented or deployed during the COVID-19 pandemic.

The rapid development and fluidity of this situation precludes any prediction as to the ultimate adverse impact of the COVID-19 pandemic or restrictions intended to prevent its spread. Nevertheless, the ongoing COVID-19 pandemic, and restrictions intended to prevent its spread, and the current financial, economic and capital markets environment and future developments in these and other areas present material risks and uncertainties with respect to our business, financial condition, results of operations, cash flows, liquidity and ability to satisfy our debt service obligations and to pay dividends and distributions to security holders and could also have a material adverse effect on the market value of our securities. Moreover, to the extent any of these risks and uncertainties adversely impact us in the ways described above or otherwise, they may also have the effect of heightening many of the other risks set forth in this “Risk Factors” section.

Global market, economic and geopolitical conditions may adversely affect our business, results of operations, liquidity and financial condition and those of our tenants. Our business may be adversely affected by global market, economic and geopolitical conditions, including general global economic and political uncertainty and dislocations in the credit markets. If these conditions become more volatile or worsen, our and our tenant’s business, results of operations, liquidity and financial condition and those of our tenants may be adversely affected as a result of the following consequences, among others:

•the financial condition of our tenants, many of which are technology; life science and healthcare; finance, insurance and real estate; media and professional business and other service firms, may be adversely affected, which may result in tenant defaults under leases due to bankruptcy, lack of liquidity, operational failures or for other reasons;

•significant job losses in the financial and professional services industries may occur, which may decrease demand for our office space, causing market rental rates and property values to be negatively impacted;

•our ability to obtain financing on terms and conditions that we find acceptable, or at all, may be limited, which could reduce our ability to pursue acquisition and development opportunities and refinance existing debt, reduce our returns from our acquisition and development activities and increase our future interest expense;

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•reduced values of our properties may limit our ability to dispose of assets at attractive prices or to obtain debt financing secured by our properties and may reduce the availability of unsecured loans; and

•one or more lenders under the Operating Partnership’s unsecured revolving credit facility could refuse to fund their financing commitment to us or could fail and we may not be able to replace the financing commitment of any such lenders on favorable terms, or at all.

All of our properties are located in California and greater Seattle, Washington and we may therefore be susceptible to adverse economic conditions and regulations, as well as natural disasters, in those areas. Because all of our properties are concentrated in California and greater Seattle, we may be exposed to greater economic risks than if we owned a more geographically dispersed portfolio. Further, within California, our properties are concentrated in Greater Los Angeles, San Diego County and the San Francisco Bay Area, exposing us to risks associated with those specific areas. We are susceptible to adverse developments in the economic and regulatory environments of California and greater Seattle (such as periods of economic slowdown or recession, business layoffs or downsizing, industry slowdowns, relocations of businesses, increases in real estate and other taxes, costs of complying with governmental regulations or increased regulation and other factors), as well as adverse weather conditions and natural disasters that occur in those areas (such as earthquakes, wind, landslides, droughts, fires and other events). For example, many of our assets are in zones that have been impacted by drought and, as such, face the risk of increased water costs and potential fines and/or penalties for high consumption. In addition, California is also regarded as more litigious and more highly regulated and taxed than many other states, which may reduce demand for office space in California.

Any adverse developments in the economy or real estate market in California and the surrounding region, or in greater Seattle or any decrease in demand for office space resulting from the California or greater Seattle regulatory or business environment could impact our ability to generate revenues sufficient to meet our operating expenses or other obligations, which would adversely impact our financial condition, results of operations, cash flows, the quoted trading price of our securities and our ability to satisfy our debt service obligations and to pay dividends and distributions to our security holders.

Our performance and the market value of our securities are subject to risks associated with our investments in real estate assets and with trends in the real estate industry. Our economic performance and the value of our real estate assets and, consequently the market value of the Company’s securities, are subject to the risk that our properties may not generate revenues sufficient to meet our operating expenses or other obligations. A deficiency of this nature would adversely impact our financial condition, results of operations, cash flows, the quoted trading price of our securities, and our ability to satisfy our debt service obligations and to pay dividends and distributions to our security holders.

Events and conditions applicable to owners and operators of real estate that are beyond our control and could impact our economic performance and the value of our real estate assets may include:

•local oversupply or reduction in demand for office, mixed-use or other commercial space, which may result in decreasing rental rates and greater concessions to tenants;

•inability to collect rent from tenants;

•vacancies or inability to rent space on favorable terms or at all;

•inability to finance property development and acquisitions on favorable terms or at all;

•increased operating costs, including insurance premiums, utilities and real estate taxes;

•costs of complying with changes in governmental regulations;

•the relative illiquidity of real estate investments;

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•declines in real estate asset valuations, which may limit our ability to dispose of assets at attractive prices or obtain or maintain debt financing;

•changing submarket demographics;

•changes in space utilization by our tenants due to technology, economic conditions and business culture;

•the development of harmful mold or other airborne toxins or contaminants that could damage our properties or expose us to third-party liabilities; and

•property damage resulting from seismic activity or other natural disasters.

We depend upon significant tenants, and the loss of a significant tenant could adversely affect our financial condition, results of operations, ability to borrow funds and cash flows. As of December 31, 2020, our 15 largest tenants represented approximately 49.1% of total annualized base rental revenues. See further discussion on the composition of our tenants by industry and our largest tenants under “Item 2. Properties —Significant Tenants.”

Our financial condition, results of operations, ability to borrow funds and cash flows would be adversely affected if any of our significant tenants fails to renew its lease(s), renew its lease(s) on terms less favorable to us, or becomes bankrupt or insolvent or otherwise unable to satisfy its lease obligations.

Downturns in tenants’ businesses may reduce our revenues and cash flows. For the year ended December 31, 2020, we derived approximately 99.3% of our revenues from rental income. A tenant may experience a downturn in its business, which may weaken its financial condition and result in its failure to make timely rental payments or result in defaults under our leases. In the event of default by a tenant, we may experience delays in enforcing our rights as landlord and may incur substantial costs in protecting our investment.

The bankruptcy or insolvency of a major tenant also may adversely affect the income produced by our properties. If any tenant becomes a debtor in a case under federal bankruptcy law, we cannot evict the tenant solely because of the bankruptcy. In addition, the bankruptcy court might permit the tenant to reject and terminate its lease with us. Our claim against the tenant for unpaid and future rent could be subject to a statutory cap that might be substantially less than the remaining rent actually owed under the lease. Therefore, our claim for unpaid rent would likely not be paid in full. Any losses resulting from the bankruptcy of any of our existing tenants could adversely impact our financial condition, results of operations, cash flows, the quoted trading price of our securities, and our ability to satisfy our debt service obligations and to pay dividends and distributions to our security holders.

A large percentage of our tenants operate in a concentrated group of industries and downturns in these industries could adversely affect our financial condition, results of operations and cash flows. As of December 31, 2020, as a percentage of our annualized base rental revenue for the stabilized portfolio, 58% of our tenants operated in the technology industry, 13% in the life science and health care industries, 11% in the media industry, 7% in the finance, insurance and real estate industries, 4% in the professional, business and other services industries and 7% in other industries. As we continue our development and potential acquisition activities in markets populated by knowledge and creative based tenants in the technology and media industries, our tenant mix could become more concentrated, further exposing us to risks associated with those industries. For a further discussion of the composition of our tenants by industry, see “Item 2. Properties —Significant Tenants.” An economic downturn in any of these industries, or in any industry in which a significant number of our tenants currently or may in the future operate, could negatively impact the financial condition of such tenants and cause them to fail to make timely rental payments or default on lease obligations, fail to renew their leases or renew their leases on terms less favorable to us, become bankrupt or insolvent, or otherwise become unable to satisfy their obligations to us. As a result, a downturn in an industry in which a significant number of our tenants operate could adversely affect our financial conditions, result of operations and cash flows.

We may be unable to renew leases or re-lease available space. Most of our income is derived from the rent earned from our tenants. We had office space representing approximately 8.8% of the total square footage of our stabilized office properties that was not occupied as of December 31, 2020. In addition, leases representing approximately 4.4% and 6.6% of the leased rentable square footage of our properties are scheduled to expire in 2021

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and 2022, respectively. Of the leases scheduled to expire in 2021 and 2022, 21% and 4% of the rentable square footage scheduled to expire was re-leased, respectively, as of December 31, 2020. Above market rental rates on some of our properties may force us to renew or re-lease expiring leases at rates below current lease rates. We cannot provide any assurance that leases will be renewed, available space will be re-leased or that our rental rates will be equal to or above the current rental rates. If the average rental rates for our properties decrease, existing tenants do not renew their leases, or available space is not re-leased, our financial condition, results of operations, cash flows, the quoted trading price of our securities, and our ability to satisfy our debt service obligations and to pay dividends and distributions to our security holders could be adversely affected. For additional information on our scheduled lease expirations, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations —Factors That May Influence Future Results of Operations.”

We are subject to governmental regulations that may affect the development, redevelopment and use of our properties. Our properties are subject to regulation under federal laws, such as the Americans with Disabilities Act of 1990 (the “ADA”), pursuant to which all public accommodations must meet federal requirements related to access and use by disabled persons, and state and local laws addressing earthquake, fire and life safety requirements. Although we believe that our properties substantially comply with requirements under applicable governmental regulations, none of our properties have been audited or investigated for compliance by any regulatory agency. If we were not in compliance with material provisions of the ADA or other regulations affecting our properties, we might be required to take remedial action, which could include making modifications or renovations to our properties. Federal, state, or local governments may also enact future laws and regulations that could require us to make significant modifications or renovations to our properties. If we were to incur substantial costs to comply with the ADA or any other regulations, our financial condition, results of operations, cash flows, the quoted trading price of our securities, and our ability to satisfy our debt service obligations and to pay dividends and distributions to our security holders could be adversely affected.

Our properties are subject to land use rules and regulations that govern our development, redevelopment and use of our properties, such as Title 24 of the California Code of Regulations (“Title 24”), which prescribes building energy efficiency standards for residential and nonresidential buildings in the State of California. If we were not in compliance with material provisions of Title 24 or other regulations affecting our properties, we might be required to take remedial action, which could include making modifications or renovations to our properties. Changes in the existing land use rules and regulations and approval process that restrict or delay our ability to develop, redevelop or use our properties (such as potential restrictions on the use and/or density of new developments, water use and other uses and activities) or that prescribe additional standards could have an adverse effect on our financial position, results of operations, cash flows, the quoted trading price of our securities, and our ability to satisfy our debt service obligations and to pay dividends and distributions to our security holders.

We face significant competition, which may decrease the occupancy and rental rates of our properties. We compete with several developers, owners and operators of office, undeveloped land and other commercial real estate, including mixed-use and residential real estate, many of which own properties similar to ours in the same submarkets in which our properties are located but which have lower occupancy rates than our properties. Therefore, our competitors have an incentive to decrease rental rates until their available space is leased. If our competitors offer space at rental rates below the rates currently charged by us for comparable space, we may be pressured to reduce our rental rates below those currently charged in order to retain tenants when our tenant leases expire. As a result, our financial condition, results of operations, cash flow, the quoted trading price of our securities, and our ability to satisfy our debt service obligations and to pay dividends and distributions to our security holders may be adversely affected.

In order to maintain the quality of our properties and successfully compete against other properties, we must periodically spend money to maintain, repair and renovate our properties, which reduces our cash flows. If our properties are not as attractive to current and prospective tenants in terms of rent, services, condition or location as properties owned by our competitors, we could lose tenants or suffer lower rental rates. As a result, we may from time to time be required to make significant capital expenditures to maintain the competitiveness of our properties. There can be no assurances that any such expenditure would result in higher occupancy or higher rental rates, or deter existing tenants from relocating to properties owned by our competitors.

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Potential casualty losses, such as earthquake losses, may adversely affect our financial condition, results of operations and cash flows. We carry comprehensive liability, fire, extended coverage, rental loss, and terrorism insurance covering all of our properties. Management believes the policy specifications and insured limits are appropriate given the relative risk of loss, the cost of the coverage and industry practice. We do not carry insurance for generally uninsurable losses such as loss from riots or acts of God. In addition, all of our properties are located in earthquake-prone areas. We carry earthquake insurance on our properties in an amount and with deductibles that management believes are commercially reasonable. However, the amount of our earthquake insurance coverage may not be sufficient to cover losses from earthquakes. We may also discontinue earthquake insurance on some or all of our properties in the future if the cost of premiums for earthquake insurance exceeds the value of the coverage discounted for the risk of loss. If we experience a loss that is uninsured or which exceeds policy limits, we could lose the capital invested in the damaged properties as well as the anticipated future cash flows from those properties. Further, if the damaged properties are subject to recourse indebtedness, we would continue to be liable for the indebtedness, even if the properties were irreparable.

We may not be able to rebuild our existing properties to their existing specifications if we experience a substantial or comprehensive loss of such properties. In the event that we experience a substantial or comprehensive loss of one of our properties, we may not be able to rebuild such property to its existing specifications. Further, reconstruction or improvement of such property could potentially require significant upgrades to meet zoning and building code requirements or be subject to environmental and other legal restrictions.

Our business is subject to risks associated with climate change and our sustainability strategies. Climate change could trigger extreme weather and changes in precipitation, temperature, and air quality, all of which may result in physical damage to, or a decrease in demand for, our properties located in the areas affected by these conditions. Should the impact of climate change be severe or occur for lengthy periods of time, our financial condition or results of operations would be adversely affected.

Recognizing the importance of climate change and reducing our greenhouse gas impact on the environment, as part of our sustainability strategies, we achieved carbon neutral operations in 2020 per the commitment we made in 2018. This means that the entirety of our scope 1 and scope 2 emissions are now offset through a combination of energy efficiency measures and both onsite and offsite renewables. Scope 1 emissions represent those produced by onsite natural gas consumption procured by us, and Scope 2 emissions represent those produced by onsite electricity consumption procured by us. Our own efforts to reduce our greenhouse gas impact on the environment and/or comply with changes in federal and state laws and regulations on climate change could result in significant capital expenditures to improve the energy efficiency of our existing properties or properties we may acquire. Changes to such law and regulations could also result in increased operating costs at our properties (for example, through increased utility costs). Moreover, if we are unable to maintain carbon neutral operations or comply with laws and regulations on climate change, our reputation among our tenants and investors may be damaged and we may incur fines and/or penalties.

Our properties are located in West Coast markets of the United States. To the extent that climate change impacts changes in weather patterns, our markets could experience increases in extreme weather and rising sea levels. For example, many of our assets are in zones that have been impacted by drought and, as such, face the risk of increased water costs and potential fines and/or penalties for high consumption.  We endeavor to understand these risks through the use of climate change modeling analysis. We mitigate risks uncovered through this analysis through, for example, comprehensive, proactive water reduction efforts throughout our portfolio, including domestic fixture upgrades, cooling tower optimizations, a comprehensive leak detection program and irrigation systems retrofits. We also incorporate green lease language into 100% of our new leases, including a cost recovery clause for resource-efficiency related capital expenditures in full-service gross leases, which aim to align our and our tenant’s interests on energy, water and waste efficiency.  In addition, we are building our current development projects to LEED specifications, and all of our office development projects are now designed to achieve LEED certification, either LEED Platinum or Gold.  However, there can be no assurances that we will successfully mitigate the risk of increased water costs and potential fines and/or penalties for high consumption or that we will be able to fully recoup any capital expenditures we incur in connection with our green leases.  Moreover, there can be no assurance that our development projects will be able to achieve the anticipated LEED certifications or that any of our sustainability strategies will result in reduced operating costs, higher occupancy or higher rental rates or deter our existing tenants from relocating to properties owned by our competitors. Over time, these conditions could result in

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declining demand for space at our properties or in our inability to operate the buildings as currently intended or at all. Climate change may also have indirect effects on our business by increasing the cost of, or decreasing the availability of, property insurance on terms we find acceptable or at all, or by increasing the cost of energy or water. There can be no assurance that climate change will not have a material adverse effect on our properties, operations or business.

We are subject to environmental and health and safety laws and regulations, and any costs to comply with, or liabilities arising under, such laws and regulations could be material. As an owner, operator, manager, acquirer and developer of real properties, we are subject to environmental and health and safety laws and regulations. Certain of these laws and regulations impose joint and several liability, without regard to fault, for investigation and clean-up costs on current and former owners and operators of real property and persons who have disposed of or released hazardous substances into the environment. At some of our properties, there are asbestos-containing materials, or tenants routinely handle hazardous substances as part of their operations. In addition, historical operations and conditions, including the presence of underground storage tanks, various site uses that involved hazardous substances, the landfilling of hazardous substances and solid waste, and migration of contamination from other sites, have caused soil or groundwater contamination at or near some of our properties. Although we believe that the prior owners of the affected properties or other persons may have conducted remediation of known contamination at many of these properties, not all such contamination has been remediated, further clean-up or environmental closure activities at certain of these properties is or may be required, and residual contamination could pose environmental, health, and safety risks if not appropriately addressed. We may need to investigate or remediate contaminated soil, soil gas, landfill gas, and groundwater, and we may also need to conduct landfill closure and post-closure activities, including, for example, the implementation of groundwater and methane monitoring systems and impervious cover, and the costs of such work could exceed projected or budgeted amounts. To protect the health and safety of site occupants and others, we may be required to implement and operate safeguards, including, for example, vapor intrusion mitigation systems and building protection systems to address methane. We may need to modify our methods of construction or face increased construction costs as a result of environmental conditions, and we may face obligations under agreements with governmental authorities with respect to the management of such environmental conditions. If releases from our sites migrate offsite, or if our site redevelopment activities cause or contribute to a migration of hazardous substances, neighbors or others could make claims against us, such as for property damage, personal injury, cost recovery, or natural resources damage. As of December 31, 2020, we had accrued environmental remediation liabilities of approximately $71.3 million recorded on our consolidated balance sheets in connection with certain of our in-process and future development projects. The accrued environmental remediation liabilities represent the costs we estimate we will incur when we commence development at various development acquisition sites. These estimates, which we developed with the assistance of third party experts, consist primarily of the removal of contaminated soil, performing environmental closure activities, construction remedial systems, and other related costs since we are required to dispose of any existing contaminated soil, and sometimes perform other environmental closure or remedial activities, when we develop new office properties as these sites. It is possible that we could incur additional environmental remediation costs in connection with future development projects. However, potential additional environmental costs cannot be reasonably estimated at this time and certain changes in estimates could occur as the site conditions, final project timing, design elements, actual soil conditions and other aspects of the projects, which may depend upon municipal and other approvals beyond the control of the Company, are determined. Unknown or unremediated contamination or compliance with existing or new environmental or health and safety laws and regulations could require us to incur costs or liabilities that could be material. See “Item 1. Business —Environmental Regulations and Potential Liabilities” and Note 18 “Commitments and Contingencies” to our consolidated financial statements included in this report.

We may be unable to complete acquisitions and successfully operate acquired properties. We continually evaluate the market of available properties and may continue to acquire office or mixed-use properties and undeveloped land when strategic opportunities exist. Our ability to acquire properties on favorable terms and successfully operate them is subject to various risks, including the following:

•we may potentially be unable to acquire a desired property because of competition from other real estate investors with significant capital, including both publicly traded and private REITs, institutional investment funds and other real estate investors;

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•even if we are able to acquire a desired property, competition from other real estate investors may significantly increase the purchase price;

•even if we enter into agreements for the acquisition of a desired property, we may be unable to complete such acquisitions because they remain subject to customary conditions to closing, including the completion of due diligence investigations to management’s satisfaction;

•we may be unable to finance acquisitions on favorable terms or at all;

•we may spend more than budgeted amounts in operating costs or to make necessary improvements or renovations to acquired properties;

•we may lease acquired properties at economic lease terms different than projected;

•we may acquire properties that are subject to liabilities for which we may have limited or no recourse; and

•we may be unable to complete an acquisition after making a nonrefundable deposit and incurring certain other acquisition-related costs.

If we cannot finance property acquisitions on favorable terms or operate acquired properties to meet financial expectations, our financial condition, results of operations, cash flows, the quoted trading price of our securities and our ability to satisfy our debt service obligations and to pay dividends and distributions to our security holders could be adversely affected.

There are significant risks associated with property acquisition, development and redevelopment. We may be unable to successfully complete and operate acquired, developed and redeveloped properties, and it is possible that:

•we may be unable to lease acquired, developed or redeveloped properties on lease terms projected at the time of acquisition, development or redevelopment or within budgeted timeframes;

•the operating expenses at acquired, developed or redeveloped properties may be greater than projected at the time of acquisition, development or redevelopment, resulting in our investment being less profitable than we expected;

•we may not commence or complete development or redevelopment properties on schedule or within budgeted amounts or at all;

•we may not be able to develop or redevelop the estimated square footage and other features of our development and redevelopment properties;

•we may suspend development or redevelopment projects after construction has begun due to changes in economic conditions or other factors, and this may result in the write-off of costs, payment of additional costs or increases in overall costs when the development or redevelopment project is restarted;

•we may expend funds on and devote management’s time to acquisition, development or redevelopment properties that we may not complete and as a result we may lose deposits or fail to recover expenses already incurred;

•we may encounter delays or refusals in obtaining all necessary zoning, land use, and other required entitlements, and building, occupancy, and other required governmental permits and authorizations;

•we may encounter delays or unforeseen cost increases associated with building materials or construction services resulting from trade tensions, disruptions, tariffs, duties or restrictions or an outbreak of an epidemic or pandemic;

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•we may encounter delays, refusals, unforeseen cost increases and other impairments resulting from third-party litigation; and

•we may fail to obtain the financial results expected from properties we acquire, develop or redevelop.

If one or more of these events were to occur in connection with our acquired properties, undeveloped land, or development or redevelopment properties under construction, we could be required to recognize an impairment loss. These events could also have an adverse impact on our financial condition, results of operations, cash flow, the quoted trading price of our securities, and our ability to satisfy our debt service obligations and to pay dividends and distributions to our security holders.

While we historically have acquired, developed and redeveloped office properties in California markets, over the past few years we have acquired properties in greater Seattle, where we currently have eight stabilized office properties, one development project in the tenant improvement phase and one future development project, and may in the future acquire, develop or redevelop properties for other uses and expand our business to other geographic regions where we expect the development or acquisition of property to result in favorable risk-adjusted returns on our investment. Presently, we do not possess the same level of familiarity with other outside markets, which could adversely affect our ability to acquire, develop or redevelop properties or to achieve expected performance.

We face risks associated with the development of mixed-use commercial properties. We are currently developing, and in the future may develop, properties either alone or through joint ventures that are known as “mixed-use” developments. This means that in addition to the development of office space, the project may also include space for residential, retail or other commercial purposes. Generally, we have less experience developing and managing non-office/life science real estate. As a result, if a development project includes non-office/life science space, we may develop that space ourselves or seek to partner with a third-party developer with more experience. If we do not partner with such a developer, or if we choose to develop the space ourselves, we would be exposed to specific risks associated with the development and ownership of non-office/life science real estate. In addition, if we elect to participate in the development through a joint venture, we may be exposed to the risks associated with the failure of the other party to complete the development as expected, which could require that we identify another joint venture partner and/or complete the project ourselves (including providing any necessary financing). In the case of residential properties, these risks include competition for prospective tenants from other operators whose properties may be perceived to offer a better location or better amenities or whose rent may be perceived as a better value given the quality, location and amenities that the tenant seeks. With residential properties, we will also compete against apartments, condominiums and single-family homes that are for sale or rent. Because we have less experience with residential properties, we may retain third parties to manage these properties. If we decide to wholly own a non-office project and hire a third-party manager, we could be dependent on that party and its key personnel to provide services to us, and we may not find a suitable replacement if the management agreement is terminated, or if key personnel leave or otherwise become unavailable to us.

Joint venture investments could be adversely affected by our lack of sole decision-making authority, our reliance on co-venturers' financial condition, and disputes between us and our co-venturers and could expose us to potential liabilities and losses. In addition to the 100 First LLC and 303 Second LLC strategic ventures and the Redwood City Partners, LLC venture, we may continue to co-invest in the future with third parties through partnerships, joint ventures or other entities, or through acquiring non-controlling interests in, or sharing responsibility for, managing the affairs of a property, partnership, joint venture or other entity, which may subject us to risks that may not be present with other methods of ownership, including the following:

•we would not be able to exercise sole decision-making authority regarding the property, partnership, joint venture or other entity, which would allow for impasses on decisions that could restrict our ability to sell or transfer our interests in such entity or such entity’s ability to transfer or sell its assets;

•partners or co-venturers might become bankrupt or fail to fund their share of required capital contributions, which could delay construction or development of a property or increase our financial commitment to the partnership or joint venture;

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•partners or co-venturers may pursue economic or other business interests, policies or objectives that are competitive or inconsistent with ours;

•if we become a limited partner or non-managing member in any partnership or limited liability company, and such entity takes or expects to take actions that could jeopardize our status as a REIT or require us to pay tax, we may be forced to dispose of our interest in such entity;

•disputes between us and partners or co-venturers may result in litigation or arbitration that would increase our expenses and prevent our officers and/or directors from focusing their time and effort on our business; and

•we may, in certain circumstances, be liable for the actions of our third-party partners or co-venturers.

We own certain properties subject to ground leases and other restrictive agreements that limit our uses of the properties, restrict our ability to sell or otherwise transfer the properties and expose us to the loss of the properties if such agreements are breached by us, terminated or not renewed. As of December 31, 2020, we owned fourteen office buildings, located on various land parcels and in various regions, which we lease individually on a long-term basis. As of December 31, 2020, we had approximately 2.0 million aggregate rentable square feet, or 14.0% of our total stabilized portfolio, of rental space located on these leased parcels and we may in the future invest in additional properties that are subject to ground leases or other similar restrictive arrangements. Many of these ground leases and other restrictive agreements impose significant limitations on our uses of the subject property, restrict our ability to sell or otherwise transfer our interests in the property or restrict our leasing of the property. These restrictions may limit our ability to timely sell or exchange the properties, impair the properties’ value or negatively impact our ability to find suitable tenants for the properties. In addition, if we default under the terms of any particular lease, we may lose the ownership rights to the property subject to the lease. Upon expiration of a lease, we may not be able to renegotiate a new lease on favorable terms, if at all. The loss of the ownership rights to these properties or an increase of rental expense could have an adverse effect on our financial condition, results of operations, cash flow, the quoted trading price of our securities, and our ability to satisfy our debt service obligations and to pay dividends and distributions to our security holders.

Real estate assets are illiquid, and we may not be able to sell our properties when we desire. Our investments in our properties are relatively illiquid, limiting our ability to sell our properties quickly in response to changes in economic or other conditions. In addition, the Code generally imposes a 100% prohibited transaction tax on the Company on profits derived from sales of properties held primarily for sale to customers in the ordinary course of business, which effectively limits our ability to sell properties other than on a selected basis. These restrictions on our ability to sell our properties could have an adverse effect on our financial condition, results of operations, cash flow, the quoted trading price of our securities, and our ability to satisfy our debt service obligations and to pay dividends and distributions to our security holders.

We may invest in securities related to real estate, which could adversely affect our ability to pay dividends and distributions to our security holders. We may purchase securities issued by entities that own real estate and may, in the future, also invest in mortgages. In general, investments in mortgages are subject to several risks, including:

•borrowers may fail to make debt service payments or pay the principal when due;

•the value of the mortgaged property may be less than the principal amount of the mortgage note securing the property; and

•interest rates payable on the mortgages may be lower than our cost for the funds used to acquire these mortgages.

Owning these securities may not entitle us to control the ownership, operation and management of the underlying real estate. In addition, we may have no control over the distributions with respect to these securities, which could adversely affect our ability to pay dividends and distributions to our security holders.

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We face risks associated with short-term liquid investments. From time to time, we have significant cash balances that we invest in a variety of short-term investments that are intended to preserve principal value and maintain a high degree of liquidity while providing current income. These investments may include (either directly or indirectly):

•direct obligations issued by the U.S. Treasury;

•obligations issued or guaranteed by the U.S. government or its agencies;

•taxable municipal securities;

•obligations (including certificates of deposits) of banks and thrifts;

•commercial paper and other instruments consisting of short-term U.S. dollar denominated obligations issued by corporations and banks;

•repurchase agreements collateralized by corporate and asset-backed obligations;

•both registered and unregistered money market funds; and

•other highly rated short-term securities.

Investments in these securities and funds are not insured against loss of principal. Under certain circumstances we may be required to redeem all or part of our investment, and our right to redeem some or all of our investment may be delayed or suspended. In addition, there is no guarantee that our investments in these securities or funds will be redeemable at par value. A decline in the value of our investment or a delay or suspension of our right to redeem may have a material adverse effect on our results of operations or financial condition.

Our property taxes could increase due to reassessment or property tax rate changes. We are required to pay state and local taxes on our properties. In addition, the real property taxes on our properties may increase as our properties are reassessed by taxing authorities or as property tax rates change. For example, under a current California law commonly referred to as “Proposition 13,” property tax reassessment generally occurs as a result of a “change in ownership” of a property, as specifically defined for purposes of those rules. Because the property taxing authorities may not determine whether there has been a “change in ownership” or the actual reassessed value of a property for a period of time after a transaction has occurred, we may not know the impact of a potential reassessment for a considerable amount of time following a particular transaction or construction of a new property. Therefore, the amount of property taxes we are required to pay could increase substantially from the property taxes we currently pay or have paid in the past, including on a retroactive basis. In addition, from time to time voters and lawmakers have announced initiatives to repeal or amend Proposition 13 to eliminate its application to commercial property and/or introduce split tax roll legislation. Such initiatives, if successful, would increase the assessed value and/or tax rates applicable to commercial property in California, including our properties. An increase in the assessed value of our properties or our property tax rates could adversely impact our financial condition, results of operations, cash flows, the quoted trading price of our securities, and our ability to satisfy our debt service obligations and to pay dividends and distributions to our security holders.

Our business could be adversely impacted if there are deficiencies in our disclosure controls and procedures or internal control over financial reporting. The design and effectiveness of our disclosure controls and procedures and internal control over financial reporting may not prevent all errors, misstatements or misrepresentations. While management will continue to review the effectiveness of our disclosure controls and procedures and internal control over financial reporting, there can be no guarantee that our internal control over financial reporting will be effective in accomplishing all control objectives all of the time. Deficiencies, including any material weakness, in our internal control over financial reporting that may occur in the future could result in misstatements of our results of operations, restatements of our financial statements, or otherwise adversely impact our financial condition, results of operations, cash flows, the quoted trading price of our securities, and our ability to satisfy our debt service obligations and to pay dividends and distributions to our security holders.

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We face risks associated with security breaches through cyber attacks, cyber intrusions or otherwise, as well as other significant disruptions of our information technology (IT) networks and related systems. We face risks associated with security breaches, whether through cyber attacks or cyber intrusions over the Internet, malware, computer viruses, attachments to e-mails, persons inside our organization or persons with access to systems inside our organization, and other significant disruptions of our IT networks and related systems. The risk of a security breach or disruption, particularly through cyber attack or cyber intrusion, including by computer hackers, foreign governments and cyber terrorists, has generally increased as the number, intensity and sophistication of attempted attacks and intrusions from around the world have increased. Our IT networks and related systems are essential to the operation of our business and our ability to perform day-to-day operations (including managing our building systems), and, in some cases, may be critical to the operations of certain of our tenants. There can be no assurance that our efforts to maintain the security and integrity of these types of IT networks and related systems will be effective or that attempted security breaches or disruptions would not be successful or damaging. Like other businesses, we have been and expect to continue to be subject to unauthorized access, mishandling or misuse, computer viruses or malware, cyber attacks and other events of varying degrees. Historically, these events have not adversely affected our operations or business and were not individually or in the aggregate material.

However, in the future, events such as these or other significant disruptions involving our IT networks and related systems could, among other things:

•result in unauthorized access to, destruction, loss, theft, misappropriation or release of proprietary, confidential, sensitive or otherwise valuable information of ours or others, including personally identifiable and account information that could be used to compete against us or for disruptive, destructive or otherwise harmful purposes and outcomes;

•result in unauthorized access to or changes to our financial accounting and reporting systems and related data;

•result in the theft of funds;

•result in our inability to maintain building systems relied on by our tenants;

•require significant management attention and resources to remedy any damage that results;

•subject us to regulatory penalties or claims for breach of contract, damages, credits, penalties or terminations of leases or other agreements; or

•damage our reputation among our tenants and investors.

These events could have an adverse impact on our financial condition, results of operations, cash flows, the quoted trading price of our securities, and our ability to satisfy our debt service obligations and to pay dividends and distributions to our security holders.

The actual density of our undeveloped land holdings and/or any particular land parcel may not be consistent with our potential density estimates. As of December 31, 2020, we estimate that our five future development sites, representing approximately 61 gross acres of undeveloped land, provide more than 6.0 million square feet of potential density. We caution you not to place undue reliance on the potential density estimates for our undeveloped land holdings and/or any particular land parcel because they are based solely on our estimates, using data currently available to us, and our business plans as of December 31, 2020. The actual density of our undeveloped land holdings and/or any particular land parcel may differ substantially from our estimates based on numerous factors, including our inability to obtain necessary zoning, land use and other required entitlements, as well as building, occupancy and other required governmental permits and authorizations, and changes in the entitlement, permitting and authorization processes that restrict or delay our ability to develop, redevelop or use undeveloped land holdings at anticipated density levels. Moreover, we may strategically choose not to develop, redevelop or use our undeveloped land holdings to their maximum potential density or may be unable to do so as a result of factors beyond our control, including our ability to obtain capital on terms that are acceptable to us, or at all, to fund our development and redevelopment activities. We can provide no assurance that the actual density of our undeveloped

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land holdings and/or any particular land parcel will be consistent with our potential density estimates. For additional information on our development program, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations —Factors That May Influence Future Results of Operations.”

Loss of our key personnel could harm our operations and financial performance and adversely affect the quoted trading price of our securities. The leadership and performance of John Kilroy, the Chairman of our board of directors and our Chief Executive Officer, plays a key role in the success of the Company. He is integral to the Company’s success for many reasons, including that he has a strong national or regional reputation in our industry and investment community. In addition, he has significant relationships with investors, lenders, tenants and industry personnel, which benefit the Company.

If workers providing services at our properties were to engage in a strike or other work stoppage or interruption, our business, results of operations, financial condition and liquidity could be materially adversely affected. Although we believe that our relations with our service providers are good, if disputes with our service providers arise or if workers providing services at our properties engage in a strike or other work stoppage or interruption, we could experience a significant disruption of, or inefficiencies in, our operations or at our properties or incur higher labor costs, which could have a material adverse effect on our business, results of operations, financial condition and liquidity.

Risks Related to Our Indebtedness

We may not be able to meet our debt service obligations. As of December 31, 2020, we had approximately $4.0 billion aggregate principal amount of indebtedness, of which $5.3 million in principal payments will be paid during the year ended December 31, 2021. Our total debt at December 31, 2020 represented 37.0% of our total market capitalization (which we define as the aggregate of our long-term debt and the market value of the Company’s common stock and the Operating Partnership’s common units of limited partnership interest, or common units, based on the closing price per share of the Company’s common stock as of that date). For the calculation of our market capitalization and additional information on debt maturities, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations —Liquidity and Capital Resources of the Company —Capitalization” and “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations —Liquidity and Capital Resources of the Operating Partnership —Liquidity Uses.”

Our ability to make payments on and to refinance our indebtedness and to fund our operations, working capital, and capital expenditures, depends on our ability to generate cash flow in the future. Our cash flow is subject to general economic, industry, financial, competitive, operating, legislative, regulatory, environmental and other factors, many of which are beyond our control.

The instruments and agreements governing some of our outstanding indebtedness (including borrowings under the Operating Partnership’s unsecured revolving credit facility and note purchase agreements) contain provisions that require us to repurchase for cash or repay that indebtedness under specified circumstances or upon the occurrence of specified events (including upon the acquisition by any person or group of more than a specified percentage of the aggregate voting power of all the Company’s issued and outstanding voting stock, upon certain changes in the composition of a majority of the members of the Company’s board of directors, if the Company or one of its wholly-owned subsidiaries ceases to be the sole general partner of the Operating Partnership or if the Company ceases to own, directly or indirectly, at least 60% of the voting equity interests in the Operating Partnership), and our future debt agreements and debt securities may contain similar provisions or may require that we repay or repurchase or offer to repurchase for cash the applicable indebtedness under specified circumstances or upon the occurrence of specified changes of control of the Company or the Operating Partnership or other events. We may not have sufficient funds to pay our indebtedness when due (including upon any such required repurchase, repayment or offer to repurchase), and we may not be able to arrange for the financing necessary to make those payments or repurchases on favorable terms or at all. In addition, our ability to make required payments on our indebtedness when due (including upon any such required repurchase, repayment or offer to repurchase) may be limited by the terms of other debt instruments or agreements. Our failure to pay amounts due in respect of any of our indebtedness when due would generally constitute an event of default under the instrument governing that indebtedness, which could permit the holders of that indebtedness to require the immediate repayment of that indebtedness in full and, in the case of secured indebtedness, could allow them to sell the collateral securing that

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indebtedness and use the proceeds to repay that indebtedness. Moreover, any acceleration of or default in respect of any of our indebtedness could, in turn, constitute an event of default under other debt instruments or agreements, thereby resulting in the acceleration and required repayment of that other indebtedness. Any of these events could materially adversely affect our ability to make payments of principal and interest on our indebtedness when due and could prevent us from making those payments altogether.

We cannot assure you that our business will generate sufficient cash flow from operations or that future sources of cash will be available to us in an amount sufficient to enable us to pay amounts due on our indebtedness or to fund our other liquidity needs, including cash distributions to stockholders necessary to maintain the Company’s REIT qualification. Additionally, if we incur additional indebtedness in connection with future acquisitions or for any other purpose, our debt service obligations could increase.

We may need to refinance all or a portion of our indebtedness on or before maturity. Our ability to refinance our indebtedness or obtain additional financing will depend on, among other things:

•our financial condition, results of operations and market conditions at the time; and

•restrictions in the agreements governing our indebtedness.

As a result, we may not be able to refinance our indebtedness on commercially reasonable terms or at all. If we do not generate sufficient cash flow from operations, and additional borrowings or refinancings or proceeds of asset sales or other sources of cash are not available to us, we may not have sufficient cash to enable us to meet all of our obligations. Accordingly, if we cannot service our indebtedness, we may have to take actions such as seeking additional equity financing, delaying capital expenditures, or entering into strategic acquisitions and alliances. Any of these events or circumstances could have a material adverse effect on our financial condition, results of operations, cash flows, the trading price of our securities and our ability to satisfy our debt service obligations and to pay dividends and distributions to our security holders. In addition, foreclosures could create taxable income without accompanying cash proceeds, which could require us to borrow or sell assets to raise the funds necessary to pay amounts due on our indebtedness and to meet the REIT distribution requirements discussed below, even if such actions are not on favorable terms.

The covenants in the agreements governing the Operating Partnership’s unsecured revolving credit facility and note purchase agreements may limit our ability to make distributions to the holders of our common stock. The Operating Partnership’s $750.0 million unsecured revolving credit facility and note purchase agreements contain financial covenants that could limit the amount of distributions payable by us on our common stock and any preferred stock we may issue in the future. We rely on cash distributions we receive from the Operating Partnership to pay distributions on our common stock and any preferred stock we may issue in the future and to satisfy our other cash needs. The agreements governing the unsecured revolving credit facility and the note purchase agreements provide that, if the Operating Partnership fails to pay any principal of, or interest on, any borrowings or other amounts payable under such agreement when due or during any other event of default under such revolving credit facility and the unsecured private placement notes, the Operating Partnership may make only those partnership distributions that result in distributions to us in an amount sufficient to permit us to make distributions to our stockholders that we reasonably believe are necessary to (a) maintain our qualification as a REIT for federal and state income tax purposes and (b) avoid the payment of federal or state income or excise tax. Any limitation on our ability to make distributions to our stockholders, whether as a result of these provisions in the unsecured revolving credit facility, the note purchase agreements or otherwise, could have a material adverse effect on the market value of our common stock.

A downgrade in our credit ratings could materially adversely affect our business and financial condition. The credit ratings assigned to the Operating Partnership’s debt securities and any preferred stock we may issue in the future could change based upon, among other things, our results of operations and financial condition. These ratings are subject to ongoing evaluation by credit rating agencies, and we cannot assure you that any rating will not be changed or withdrawn by a rating agency in the future if, in its judgment, circumstances warrant. Moreover, these credit ratings do not apply to our common stock and are not recommendations to buy, sell or hold our common stock or any other securities. If any of the credit rating agencies that have rated the Operating Partnership’s debt securities or any preferred stock we may issue in the future downgrades or lowers its credit rating, or if any credit rating

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agency indicates that it has placed any such rating on a so-called “watch list” for a possible downgrading or lowering or otherwise indicates that its outlook for that rating is negative, it could have a material adverse effect on our costs and availability of capital, which could in turn have a material adverse effect on our financial condition, results of operations, cash flows, the trading price of our securities, and our ability to satisfy our debt service obligations and to pay dividends and distributions to our security holders.

An increase in interest rates could increase our interest costs on variable rate debt and new debt and could adversely affect our ability to refinance existing debt, conduct development, redevelopment and acquisition activity and recycle capital. As of December 31, 2020, we had an unsecured revolving credit facility bearing interest at a variable rate on any amount drawn and outstanding. There was no amount outstanding on the revolving credit facility at December 31, 2020. However, we may borrow on the revolving credit facility or incur additional variable rate debt in the future. If interest rates increase, so could our interest costs for any variable rate debt and for new debt. This increased cost could make the financing of any development, redevelopment and acquisition activity costlier. Rising interest rates could also limit our ability to refinance existing debt when it matures or cause us to pay higher interest rates upon refinancing and increase interest expense on refinanced indebtedness. In addition, an increase in interest rates could decrease the amount third parties are willing to pay for our assets, thereby limiting our ability to recycle capital and our portfolio promptly in response to changes in economic or other conditions.

We manage a portion of our exposure to interest rate risk by accessing debt with staggered maturities, and we may in the future mitigate this risk through the use of derivative instruments, including interest rate swap agreements or other interest rate hedging agreements, including swaps, caps and floors. While these agreements are intended to lessen the impact of rising interest rates on us, they also expose us to the risks that counter parties may fail to honor their obligations, that we could incur significant costs associated with the settlement of these agreements, that the amount of income we earn from hedging transactions may be limited by federal tax provisions governing REITs, that these agreements may cause us to pay higher interest rates on our debt obligations than would otherwise be the case and that underlying transactions could fail to qualify as highly-effective cash flow hedges under the accounting guidance. As a result, failure to hedge effectively against interest rate risk, if we choose to engage in such activities, could adversely affect our financial condition, results of operations, cash flows, the quoted trading price of our securities, and our ability to satisfy our debt service obligations and to pay dividends and distributions to our security holders.

Risks Related to Our Organizational Structure

Our growth depends on external sources of capital that are outside of our control and the inability to obtain capital on terms that are acceptable to us, or at all, could adversely affect our financial condition and results of operations. The Company is required under the Code to distribute at least 90% of its taxable income (subject to certain adjustments and excluding any net capital gain), and the Operating Partnership is required to make distributions to the Company to allow the Company to satisfy these REIT distribution requirements. Because of these distribution requirements, the Operating Partnership is required to make distributions to the Company, and we may not be able to fund future capital needs, including any necessary acquisition financing, from operating cash flow. Consequently, management relies on third-party sources of capital to fund our capital needs. We may not be able to obtain financing on favorable terms or at all. Any additional debt we incur will increase our leverage. Access to third-party sources of capital depends, in part, on general market conditions and the availability of credit, the market’s perception of our growth potential, our current and expected future earnings, our cash flows and cash distributions and the quoted trading price of our securities. If we cannot obtain capital from third-party sources, our financial condition, results of operations, cash flows, the quoted trading price of our securities, and our ability to satisfy our debt service obligations and to pay dividends and distributions to our security holders may be adversely affected.

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Our common limited partners have limited approval rights, which may prevent us from completing a change of control transaction that may be in the best interests of all our security holders. The Company may not withdraw as the Operating Partnership’s general partner or transfer its general partnership interest in the Operating Partnership without the approval of the holders of at least 60% of the units representing common partnership interests, including the common units held by the Company in its capacity as the Operating Partnership’s general partner. In addition, the Company may not engage in a merger, consolidation or other combination or the sale of substantially all of its assets or such similar transaction, without the approval of the holders of 60% of the common units, including the common units held by the Company in its capacity as the Operating Partnership’s general partner. The right of our common limited partners to vote on these transactions could limit our ability to complete a change of control transaction that might otherwise be in the best interest of all our security holders.

In certain circumstances, our limited partners must approve our dissolution and the disposition of properties contributed by the limited partners. For as long as limited partners own at least 5% of all of the Operating Partnership’s partnership interests, we must obtain the approval of limited partners holding a majority of the units representing common limited partnership interests before we may dissolve. As of December 31, 2020, limited partners owned approximately 1.0% of the Operating Partnership’s partnership interests, of which 0.7% was owned by John Kilroy. In addition, we agreed to use commercially reasonable efforts to minimize the tax consequences to certain common limited partners resulting from the repayment, refinancing, replacement, or restructuring of debt, or any sale, exchange, or other disposition of any of our other assets. The exercise of one or more of these approval rights by the limited partners could delay or prevent us from completing a transaction that may be in the best interest of all our security holders.

The Chairman of our board of directors and Chief Executive Officer has substantial influence over our affairs. John Kilroy is the Chairman of our board of directors and our Chief Executive Officer. John Kilroy beneficially owned, as of December 31, 2020, approximately 1.4% of the total outstanding shares of our common stock. The percentage of outstanding shares of common stock beneficially owned includes 330,451 shares of common stock, 515,127 restricted stock units (“RSUs”) that were vested and held by John Kilroy at December 31, 2020, and assumes the exchange into shares of our common stock of the 783,192 common units of the Operating Partnership held by John Kilroy (which may be exchanged for an equal number of shares of our common stock).

Pursuant to the Company’s charter, no stockholder may own, actually or constructively, more than 7.0% (by value or by number of shares, whichever is more restrictive) of our outstanding common stock without obtaining a waiver from the board of directors. In connection with the Company’s initial public offering, the board of directors waived the ownership limits with respect to John Kilroy, members of his family and some of their affiliated entities. These named individuals and entities may own either actually or constructively, in the aggregate, up to 19.6% of our common stock, excluding Operating Partnership units that are exchangeable into shares of our common stock. Consequently, John Kilroy has substantial influence over the Company, and because the Company is the manager of the Operating Partnership, over the Operating Partnership, and could exercise his influence in a manner that is not in the best interest of our stockholders, noteholders or unitholders. Also, John Kilroy may, in the future, have a substantial influence over the outcome of any matters submitted to our stockholders or unitholders for approval.

There are restrictions on the ownership of the Company’s capital stock that limit the opportunities for a change of control at a premium to existing security holders. Provisions of the Maryland General Corporation Law, the Company’s charter and bylaws and the Operating Partnership’s partnership agreement may delay, deter, or prevent a change of control of the Company, or the removal of existing management. Any of these actions might prevent our security holders from receiving a premium for their shares of common stock or common units over the then-prevailing market price of the shares of our common stock.

In order for the Company to qualify as a REIT under the Code, its stock must be beneficially owned by 100 or more persons during at least 335 days of a taxable year of 12 months (other than the first year for which an election to be a REIT has been made) or during a proportionate part of a shorter taxable year. Also, not more than 50% of the value of the outstanding shares of the Company’s stock may be owned, actually or constructively, by five or fewer individuals (as defined in the Code to include certain entities) during the last half of a taxable year (other than the first year for which an election to be a REIT has been made). The Company’s charter contains restrictions on the ownership and transfer of its capital stock that are intended to assist the Company in complying with these requirements and continuing to qualify as a REIT. No single stockholder may own, either actually or constructively,

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absent a waiver from the board of directors, more than 7.0% (by value or by number of shares, whichever is more restrictive) of the Company’s outstanding common stock.

The constructive ownership rules under the Code are complex and may cause stock owned actually or constructively by a group of related individuals and/or entities to be owned constructively by one individual or entity. As a result, the acquisition of less than the applicable ownership limit of a particular class of the Company’s capital stock could, nevertheless, cause that individual or entity, or another individual or entity, to constructively own stock in excess of, and thereby subject such stock to, the applicable ownership limit.

The board of directors may waive the ownership limits if it is satisfied that the excess ownership would not jeopardize the Company’s REIT status and if it believes that the waiver would be in our best interest. The board of directors has waived the ownership limits with respect to John Kilroy, members of his family and some of their affiliated entities. These named individuals and entities may own either actually or constructively, in the aggregate, up to 19.6% of our outstanding common stock, excluding common units that are exchangeable into shares of common stock.

If anyone acquires shares in excess of any ownership limits without a waiver, the transfer to the transferee will be void with respect to the excess shares, the excess shares will be automatically transferred to a trust for the benefit of a qualified charitable organization, and the purported transferee or owner will have no rights with respect to those excess shares.

The Company’s charter contains provisions that may delay, deter or prevent a change of control transaction. The following provisions of the Company’s charter may delay or prevent a change of control over us, even if a change of control might be beneficial to our security holders, deter tender offers that may be beneficial to our security holders, or limit security holders’ opportunity to receive a potential premium for their shares and/or units if an investor attempted to gain shares beyond the Company’s ownership limits or otherwise to effect a change of control:

•the Company’s charter authorizes the board of directors to issue up to 30,000,000 shares of the Company’s preferred stock, including convertible preferred stock, without stockholder approval. The board of directors may establish the preferences, rights and other terms, including the right to vote and the right to convert into common stock any shares issued. The issuance of preferred stock could delay or prevent a tender offer or a change of control even if a tender offer or a change of control was in our security holders’ interest; and

•the Company’s charter states that any director, or the entire board of directors, may be removed from office at any time, but only for cause and then only by the affirmative vote of the holders of at least two thirds of the votes of the Company’s capital stock entitled to be cast in the election of directors.

The board of directors may change investment and financing policies without stockholder or unitholder approval. Our board of directors determines our major policies, including policies and guidelines relating to our acquisition, development and redevelopment activities, leverage, financing, growth, operations, indebtedness, capitalization and distributions to our security holders. Our board of directors may amend or revise these and other policies and guidelines from time to time without stockholder or unitholder approval. Accordingly, our stockholders and unitholders will have limited control over changes in our policies and those changes could adversely impact our financial condition, results of operations, cash flows, the quoted trading price of our securities, and our ability to satisfy our debt service obligations and to pay dividends and distributions to our security holders.

We are not limited in our ability to incur debt. Our financing policies and objectives are determined by the board of directors. Our goal is to limit our dependence on leverage and maintain a conservative ratio of debt to total market capitalization. However, our organizational documents do not limit the amount or percentage of indebtedness, funded or otherwise, that we may incur. As of December 31, 2020, we had approximately $4.0 billion aggregate principal amount of indebtedness outstanding, which represented 37.0% of our total market capitalization. See “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations —Liquidity and Capital Resources of the Company —Capitalization” for a calculation of our market capitalization. These ratios may be increased or decreased without the consent of our unitholders or stockholders. Increases in the amount of debt outstanding would result in an increase in our debt service costs, which could adversely affect cash flow and

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our ability to pay dividends and distributions to our security holders. Higher leverage also increases the risk of default on our obligations and limits our ability to obtain additional financing in the future.

We may issue additional common units and shares of capital stock without unitholder or stockholder approval, as applicable, which may dilute unitholder or stockholder investment. The Company may issue shares of our common stock, preferred stock or other equity or debt securities without stockholder approval, including the issuance of shares to satisfy REIT dividend distribution requirements. Similarly, the Operating Partnership may offer its common or preferred units for contributions of cash or property without approval by our stockholders or the Operating Partnership’s unitholders. Existing security holders have no preemptive rights to acquire any of these securities, and any issuance of equity securities under these circumstances may dilute a unitholder's or stockholder's investment.

Sales of a substantial number of shares of the Company’s securities, or the perception that this could occur, could result in decreasing the quoted trading price per share of the Company’s common stock and of the Operating Partnership’s publicly-traded notes. Management cannot predict whether future issuances of shares of the Company’s common stock, or the availability of shares for resale in the open market will result in decreasing the market price per share of the Company’s common stock. As of December 31, 2020, 116,035,827 shares of the Company’s common stock were issued and outstanding.

As of December 31, 2020, the Company had reserved for future issuance the following shares of common stock: 1,150,574 shares issuable upon the exchange, at the Company’s option, of the Operating Partnership’s common units; approximately 1.5 million shares remained available for grant under our 2006 Incentive Award Plan (see Note 15 “Share-Based and Other Compensation” to our consolidated financial statements included in this report); approximately 1.6 million shares issuable upon settlement of time-based RSUs; a maximum of 1.5 million shares contingently issuable upon settlement of RSUs subject to the achievement of market and/or performance conditions; and 9,000 shares issuable upon exercise of outstanding options. The Company has a currently effective registration statement registering 10.7 million shares of our common stock for possible issuance under our 2006 Incentive Award Plan. The Company has a currently effective registration statement registering 1,649,760 shares of our common stock for possible issuance to and resale by certain holders of the Operating Partnership’s common units. That registration statement also registers 94,441 shares of common stock held by John Kilroy for possible resale. Consequently, if and when the shares are issued, they may be freely traded in the public markets.

Risks Related to Taxes and the Company’s Status as a REIT

Loss of the Company’s REIT status would have significant adverse consequences to us and the value of the Company’s common stock. The Company currently operates in a manner that is intended to allow it to qualify as a REIT for federal income tax purposes under the Code. If the Company were to lose its REIT status, the Company would face adverse tax consequences that would substantially reduce the funds available for distribution to its stockholders for each of the years involved because:

•the Company would not be allowed a deduction for dividends paid to its stockholders in computing the Company’s taxable income and would be subject to regular U.S. federal corporate income tax;

•the Company could be subject to increased state and local taxes; and

•unless entitled to relief under statutory provisions, the Company could not elect to be taxed as a REIT for four taxable years following the year during which the Company was disqualified.

In addition, if the Company failed to qualify as a REIT, it would not be required to make distributions to its stockholders. As a result of all these factors, the Company’s failure to qualify as a REIT also could impair our ability to expand our business and raise capital, and could adversely affect the value and quoted trading price of the Company’s common stock.

Qualification as a REIT involves the application of highly technical and complex Code provisions for which there are only limited judicial and administrative interpretations. The complexity of these provisions and of the applicable Treasury regulations that have been promulgated under the Code is greater in the case of a REIT that, like

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the Company, holds its assets through a partnership. The determination of various factual matters and circumstances not entirely within our control may affect the Company’s ability to continue to qualify as a REIT. For example, to qualify as a REIT, at least 95% of the Company’s gross income in any year must be derived from qualifying sources. Also, the Company must make distributions to its stockholders aggregating annually at least 90% of the Company’s net taxable income (subject to certain adjustments and excluding any net capital gains). In addition, legislation, new regulations, administrative interpretations or court decisions may adversely affect the Company’s security holders or the Company’s ability to qualify as a REIT for federal income tax purposes or the desirability of an investment in a REIT relative to other investments. Although management believes that we are organized and operate in a manner to permit the Company to continue to qualify as a REIT, we cannot provide assurances that the Company has qualified or will continue to qualify as a REIT for tax purposes. We have not requested and do not plan to request a ruling from the Internal Revenue Service (“IRS”) regarding the Company’s qualification as a REIT.

To maintain the Company’s REIT status, we may be forced to borrow funds during unfavorable market conditions. To qualify as a REIT, the Company generally must distribute to its stockholders at least 90% of the Company’s net taxable income each year (subject to certain adjustments and excluding any net capital gains), and the Company will be subject to regular corporate income taxes to the extent that it distributes less than 100% of its net capital gains or distributes at least 90%, but less than 100%, of its net taxable income each year. In addition, the Company will be subject to a 4% nondeductible excise tax on the amount, if any, by which distributions it pays in any calendar year are less than the sum of 85% of its ordinary income, 95% of its net capital gains, and 100% of its undistributed income from prior years. To maintain the Company’s REIT status and avoid the payment of federal income and excise taxes, the Operating Partnership may need to borrow funds and distribute or loan the proceeds to the Company so it can meet the REIT distribution requirements even if the then-prevailing market conditions are not favorable for these borrowings. These borrowing needs could result from differences in timing between the actual receipt of income and inclusion of income for federal income tax purposes, or the effect of nondeductible capital expenditures, the creation of reserves or required debt or amortization payments.

If a transaction intended to qualify as a Section 1031 Exchange is later determined to be taxable or if we are unable to identify and complete the acquisition of a suitable replacement property to effect a Section 1031 Exchange, we may face adverse consequences, and if the laws applicable to such transactions are amended or repealed, we may not be able to dispose of properties on a tax deferred basis. When possible, we dispose of properties in transactions that are intended to qualify as Section 1031 Exchanges. It is possible that the qualification of a transaction as a Section 1031 Exchange could be successfully challenged and determined to be currently taxable or that we may be unable to identify and complete the acquisition of a suitable replacement property to effect a Section 1031 Exchange. In such case, our taxable income and the Company’s and earnings and profits could increase. This could increase the dividend income to the Company’s stockholders by reducing any return of capital they received. In some circumstances, the Company may be required to pay additional dividends or, in lieu of that, corporate income tax, possibly including interest and penalties. As a result, we may be required to borrow funds in order to pay additional dividends or taxes and the payment of such taxes could cause us to have less cash available to distribute to the Company’s stockholders. In addition, if a Section 1031 Exchange were later to be determined to be taxable, we may be required to amend our tax returns for the applicable year in question, including any information reports we sent the Company’s stockholders. Moreover, under the Tax Cuts and Jobs Act (the “2017 Tax Legislation”), for exchanges completed after December 31, 2017, unless the property was disposed of or received in the exchange on or before such date, Section 1031 of the Code permits exchanges of real property only. It is possible that additional legislation could be enacted that could further modify or repeal the laws with respect to Section 1031 Exchanges, which could make it more difficult or not possible for us to dispose of properties on a tax deferred basis.

Dividends payable by REITs, including the Company, generally do not qualify for the reduced tax rates available for some dividends. “Qualified dividends” payable to U.S. stockholders that are individuals, trusts and estates generally are subject to tax at preferential rates. Subject to limited exceptions, dividends payable by REITs are not eligible for these reduced rates and are taxable at ordinary income tax rates. The more favorable rates applicable to regular corporate qualified dividends could cause investors who are individuals, trusts and estates to perceive investments in REITs to be relatively less attractive than investments in the stocks of non-REIT corporations that pay dividends, which could adversely affect the value of the shares of REITs, including the shares of our capital stock. However, non-corporate stockholders, including individuals, generally may deduct up to 20%

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of dividends from a REIT, other than capital gain dividends and dividends treated as qualified dividend income, for taxable years beginning after December 31, 2017 and before January 1, 2026.

The tax imposed on REITs engaging in “prohibited transactions” may limit our ability to engage in transactions which would be treated as sales for federal income tax purposes. A REIT’s net income from prohibited transactions is subject to a 100% penalty tax. In general, prohibited transactions are sales or other dispositions of property, other than foreclosure property, held primarily for sale to customers in the ordinary course of business. Although we do not intend to hold any properties that would be characterized as held for sale to customers in the ordinary course of our business, unless a sale or disposition qualifies under certain statutory safe harbors, such characterization is a factual determination and no guarantee can be given that the IRS would agree with our characterization of our properties or that we will always be able to make use of the available safe harbors.

Complying with REIT requirements may cause us to forego otherwise attractive opportunities or liquidate otherwise attractive investments. To qualify as a REIT for federal income tax purposes, the Company must continually satisfy tests concerning, among other things, the sources of its income, the nature and diversification of its assets, the amounts it distributes to its stockholders and the ownership of its capital stock. If the Company fails to comply with one or more of the asset tests at the end of any calendar quarter, the Company must correct the failure within 30 days after the end of the calendar quarter or qualify for certain statutory relief provisions to avoid losing its REIT qualification and suffering adverse tax consequences. In order to meet these tests, we may be required to forego investments we might otherwise make or to liquidate otherwise attractive investments. Thus, compliance with the REIT requirements may hinder our performance and reduce amounts available for distribution to the Company’s stockholders.

Legislative or regulatory action could adversely affect our stockholders or us. In recent years, numerous legislative, judicial and administrative changes have been made to the federal income tax laws applicable to investments in REITs and similar entities. Additional changes to tax laws are likely to continue to occur in the future, and any such changes may adversely impact the Company’s ability to qualify as a REIT, its tax treatment as a REIT, our ability to comply with contractual obligations or the tax treatment of our stockholders and limited partners. Also, the law relating to the tax treatment of other entities, or an investment in other entities, could change, making an investment in such other entities more attractive relative to an investment in a REIT.

ITEM 1B.    UNRESOLVED STAFF COMMENTS

None.

37

ITEM 2.    PROPERTIES

General

Our stabilized portfolio of operating properties was comprised of the following properties at December 31, 2020:

	Number of Buildings	Rentable Square Feet	Number of Tenants	Percentage  Occupied (1)		Percentage Leased
Stabilized Office Properties (2)	117	14,620,166	447	91.2	%	94.3	%

_______________________

(1)Represents physical and economic occupancy.

(2)Includes stabilized life science and retail space.

	Number of Properties	Number of Units	2020 Average Occupancy
Stabilized Residential Properties	2	808	72.0	%

Our stabilized portfolio includes all of our properties with the exception of development and redevelopment properties currently committed for construction, under construction or in the tenant improvement phase, undeveloped land and real estate assets held for sale. 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 properties in the tenant improvement phase as office and life science properties that we are developing or redeveloping where the project has reached cold shell condition and is ready for tenant improvements, which may require additional major base building construction before being placed in service. Projects in the tenant improvement phase are added to our stabilized portfolio once the project reaches the earlier of 95% occupancy or one year from the date of the cessation of major base building construction activities. Costs capitalized to construction in progress for development and redevelopment properties are transferred to land and improvements, buildings and improvements, and deferred leasing costs on our consolidated balance sheets at the historical cost of the property as the projects or phases of projects are placed in service.

During the year ended December 31, 2020, we added four development projects to our stabilized portfolio consisting of 750,370 square feet of office in San Francisco, California, 361,388 square feet of office space in Hollywood, California, 95,871 square feet of retail space and 608 residential units in San Diego, California. As of December 31, 2020, the following properties were excluded from our stabilized portfolio. We did not have any redevelopment properties or properties held for sale at December 31, 2020.

	Number of Properties/Projects	Estimated Rentable Square Feet (1)
In-process development projects - tenant improvement	3	1,080,000
In-process development projects - under construction (2)	3	856,000

________________________

(1)Estimated rentable square feet upon completion.

(2)In addition to the estimated office and life science rentable square feet noted above, development projects under construction also include 193 residential units.

Our stabilized portfolio also excludes our future development pipeline, which as of December 31, 2020, was comprised of five future development sites, representing approximately 61 gross acres of undeveloped land.

As of December 31, 2020, 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 eight stabilized office properties, one development project in the tenant improvement phase and one future development project located in the state of Washington. All of our properties and development projects are 100% owned, excluding four office properties owned by three consolidated property partnerships.

38

We own our interests in all of our real estate assets through the Operating Partnership. All our properties are held in fee, except for the fourteen office buildings that are held subject to five long-term ground leases for the land (see Note 18 “Commitments and Contingencies” to our consolidated financial statements included in this report for additional information regarding our ground lease obligations).

In general, the office properties are leased to tenants on a full service gross, modified gross or triple net basis. Under a full service gross lease, we are obligated to pay the tenant’s proportionate share of real estate taxes, insurance and operating expenses up to the amount incurred during the tenant’s first year of occupancy (“Base Year”). The tenant pays its pro-rata share of increases in expenses above the Base Year. A modified gross lease is similar to a full service gross lease, except tenants are obligated to pay their proportionate share of certain operating expenses, usually electricity, directly to the service provider. In addition, some office properties, primarily in the Greater Seattle region and certain properties in certain submarkets in the San Francisco Bay Area and Greater Los Angeles, are leased to tenants on a triple net basis, pursuant to which the tenants pay their proportionate share of real estate taxes, operating costs and utility costs.

We believe that all of our properties are well maintained and do not require significant capital improvements. As of December 31, 2020, we managed all of our office properties through internal property managers.

Office Properties

The following table sets forth certain information relating to each of the stabilized office properties owned as of December 31, 2020.

Property Location		No. of Buildings	Year Built/ Renovated	Rentable Square Feet	Percentage Occupied at 12/31/2020 (1)		Annualized Base Rent (in $000’s) (2)		Annualized Rent Per Square Foot (2)
Greater Los Angeles
3101-3243 La Cienega Boulevard, Culver City, California	(3)	19	2008-2017	151,908	91.9	%	$	6,390	$	45.75
2240 East Imperial Highway, El Segundo, California	(4)	1	1983/ 2008	122,870	100.0	%	3,950		32.15
2250 East Imperial Highway, El Segundo, California	(5)	1	1983	298,728	100.0	%	10,206		34.31
2260 East Imperial Highway, El Segundo, California	(4)	1	1983/ 2012	298,728	100.0	%	10,510		35.18
909 North Pacific Coast Highway, El Segundo, California	(6)	1	1972/ 2005	244,136	89.4	%	8,184		37.98
999 North Pacific Coast Highway, El Segundo, California	(7)	1	1962/ 2003	128,588	93.6	%	3,854		34.73
1350 Ivar Avenue, Los Angeles, California	(3)	1	2020	16,448	100.0	%	1,013		61.58
1355 Vine Street, Los Angeles, California	(3)	1	2020	183,129	100.0	%	10,909		59.57
1375 Vine Street, Los Angeles, California	(3)	1	2020	159,236	100.0	%	9,805		61.58
1395 Vine Street, Los Angeles, California	(3)	1	2020	2,575	100.0	%	161		62.65
6115 West Sunset Boulevard, Los Angeles, California	(8)	1	1938/ 2015	26,105	73.1	%	1,145		59.98
6121 West Sunset Boulevard, Los Angeles, California	(3)	1	1938/ 2015	91,173	100.0	%	4,612		50.59
1525 North Gower Street, Los Angeles, California	(4)	1	2016	9,610	100.0	%	650		67.61
1575 North Gower Street, Los Angeles, California	(9)	1	2016	251,245	100.0	%	16,141		64.24
1500 North El Centro Avenue, Los Angeles, California	(10)	1	2016	104,504	27.9	%	1,967		67.41
6255 Sunset Boulevard, Los Angeles, California	(11)	1	1971/ 1999	323,920	93.0	%	13,669		46.86
3750 Kilroy Airport Way, Long Beach, California	(10)	1	1989	10,718	62.9	%	92		29.89

39

Property Location		No. of Buildings	Year Built/ Renovated	Rentable Square Feet	Percentage Occupied at 12/31/2020 (1)		Annualized Base Rent (in $000’s) (2)		Annualized Rent Per Square Foot (2)
3760 Kilroy Airport Way, Long Beach, California	(10)	1	1989	166,761	94.7	%	5,058		32.02
3780 Kilroy Airport Way, Long Beach, California	(10)	1	1989	221,452	94.4	%	6,856		33.47
3800 Kilroy Airport Way, Long Beach, California	(10)	1	2000	192,476	88.9	%	5,551		32.44
3840 Kilroy Airport Way, Long Beach, California	(10)	1	1999	136,026	—	%	—		—
3880 Kilroy Airport Way, Long Beach, California	(12)	1	1987/ 2013	96,923	100.0	%	2,839		29.29
3900 Kilroy Airport Way, Long Beach, California	(10)	1	1987	130,935	91.3	%	3,347		28.04
8560 West Sunset Boulevard, West Hollywood, California	(10)	1	1963/ 2007	74,842	94.1	%	4,947		70.89
8570 West Sunset Boulevard, West Hollywood, California	(13)	1	2002/ 2007	45,941	97.1	%	3,113		69.79
8580 West Sunset Boulevard, West Hollywood, California	(3)	1	2002/ 2007	7,126	—	%	—		—
8590 West Sunset Boulevard, West Hollywood, California	(3)	1	2002/ 2007	55,302	85.6	%	1,637		34.58
12100 West Olympic Boulevard, Los Angeles, California	(14)	1	2003	152,048	66.0	%	6,038		60.17
12200 West Olympic Boulevard, Los Angeles, California	(10)	1	2000	150,832	90.2	%	6,899		67.98
12233 West Olympic Boulevard, Los Angeles, California	(15)	1	1980/ 2011	151,029	55.6	%	2,323		42.32
12312 West Olympic Boulevard, Los Angeles, California	(16)	1	1950/ 1997	76,644	100.0	%	4,096		53.44
1633 26th Street, Santa Monica, California	(10)	1	1972/ 1997	43,857	69.9	%	1,722		56.19
2100/2110 Colorado Avenue, Santa Monica, California	(10)	3	1992/ 2009	102,864	100.0	%	4,980		48.41
3130 Wilshire Boulevard, Santa Monica, California	(10)	1	1969/ 1998	90,074	97.6	%	4,009		45.62
501 Santa Monica Boulevard, Santa Monica, California	(17)	1	1974	76,803	91.7	%	4,912		69.72
Subtotal/Weighted Average – Los Angeles and Ventura Counties		55		4,395,556	88.1	%	$	171,581	$	45.41
San Diego County
12225 El Camino Real, Del Mar, California	(4)	1	1998	58,401	100.0	%	$	2,483	$	42.52
12235 El Camino Real, Del Mar, California	(4)	1	1998	53,751	100.0	%	2,627		48.87
12340 El Camino Real, Del Mar, California	(18)	1	2002	89,272	50.1	%	1,615		36.11
12390 El Camino Real, Del Mar, California	(4)	1	2000	70,140	55.1	%	2,214		57.29
12348 High Bluff Drive, Del Mar, California	(19)	1	1999	39,193	85.3	%	1,363		40.79
12400 High Bluff Drive, Del Mar, California	(4)	1	2004	210,732	100.0	%	10,235		48.57
12770 El Camino Real, Del Mar, California	(20)	1	2016	73,032	66.1	%	2,205		56.52
12780 El Camino Real, Del Mar, California	(16)	1	2013	140,591	100.0	%	7,138		50.77
12790 El Camino Real, Del Mar, California	(21)	1	2013	78,836	59.2	%	2,768		59.28
3579 Valley Centre Drive, Del Mar, California	(4)	1	1999	54,960	13.0	%	367		51.30
3611 Valley Centre Drive, Del Mar, California	(22)	1	2000	130,109	40.6	%	2,876		54.40

40

Property Location		No. of Buildings	Year Built/ Renovated	Rentable Square Feet	Percentage Occupied at 12/31/2020 (1)		Annualized Base Rent (in $000’s) (2)		Annualized Rent Per Square Foot (2)
3661 Valley Centre Drive, Del Mar, California	(23)	1	2001	128,364	100.0	%	6,025		49.60
3721 Valley Centre Drive, Del Mar, California	(24)	1	2003	115,193	100.0	%	5,310		46.09
3811 Valley Centre Drive, Del Mar, California	(16)	1	2000	112,067	100.0	%	6,782		60.52
3745 Paseo Place, San Diego, California	(3)	1	2019	95,871	92.3	%	6,178		69.85
13280 Evening Creek Drive South, I-15 Corridor, California	(25)	1	2008	41,196	100.0	%	1,215		29.50
13290 Evening Creek Drive South, I-15 Corridor, California	(4)	1	2008	61,180	100.0	%	1,833		29.96
13480 Evening Creek Drive North, I-15 Corridor, California	(4)	1	2008	154,157	94.4	%	5,026		34.54
13500 Evening Creek Drive North, I-15 Corridor, California	(26)	1	2004	137,658	97.5	%	5,870		43.74
13520 Evening Creek Drive North, I-15 Corridor, California	(27)	1	2004	146,701	89.0	%	4,692		36.78
2305 Historic Decatur Road, Point Loma, California	(28)	1	2009	107,456	93.9	%	3,741		37.10
4690 Executive Drive, UTC, California	(10)	1	1999	47,846	76.4	%	1,200		32.84
Subtotal/Weighted Average – San Diego County		22		2,146,706	85.2	%	$	83,763	$	46.27
San Francisco Bay Area
4100 Bohannon Drive, Menlo Park, California	(3)	1	1985	47,379	100.0	%	$	2,640	$	55.72
4200 Bohannon Drive, Menlo Park, California	(3)	1	1987	45,451	70.8	%	1,751		54.41
4300 Bohannon Drive, Menlo Park, California	(3)	1	1988	63,079	34.1	%	1,279		59.55
4400 Bohannon Drive, Menlo Park, California	(3)	1	1988	48,146	39.4	%	939		59.40
4500 Bohannon Drive, Menlo Park, California	(3)	1	1990	63,078	100.0	%	3,580		56.76
4600 Bohannon Drive, Menlo Park, California	(3)	1	1990	48,147	70.7	%	2,010		59.06
4700 Bohannon Drive, Menlo Park, California	(3)	1	1989	63,078	100.0	%	3,513		55.70
1290-1300 Terra Bella Avenue, Mountain View, California	(3)	1	1961	114,175	100.0	%	5,344		46.80
680 East Middlefield Road, Mountain View, California	(16)	1	2014	170,090	100.0	%	7,729		45.44
690 East Middlefield Road, Mountain View, California	(16)	1	2014	170,823	100.0	%	7,763		45.44
1701 Page Mill Road, Palo Alto, California	(3)	1	2015	128,688	100.0	%	8,461		65.75
3150 Porter Drive, Palo Alto, California	(3)	1	1998	36,886	100.0	%	3,277		88.83
900 Jefferson Avenue, Redwood City, California	(3)	1	2015	228,505	100.0	%	13,670		59.82
900 Middlefield Road, Redwood City, California	(3)	1	2015	118,764	100.0	%	6,983		59.05
100 Hooper Street, San Francisco, California	(3)	1	2018	394,340	94.0	%	23,403		63.16
100 First Street, San Francisco, California	(29)	1	1988	480,457	99.2	%	32,003		70.10
201 Third Street, San Francisco, California	(30)	1	1983	346,538	90.3	%	21,729		70.26
250 Brannan Street, San Francisco, California	(4)	1	1907/ 2001	100,850	100.0	%	10,323		102.36

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Property Location		No. of Buildings	Year Built/ Renovated	Rentable Square Feet	Percentage Occupied at 12/31/2020 (1)		Annualized Base Rent (in $000’s) (2)		Annualized Rent Per Square Foot (2)
301 Brannan Street, San Francisco, California	(4)	1	1909/ 1989	82,834	100.0	%	7,580		91.51
303 Second Street, San Francisco, California	(31)	1	1988	784,658	82.9	%	50,506		77.92
333 Brannan Street, San Francisco, California	(32)	1	2016	185,602	100.0	%	18,138		97.73
345 Brannan Street, San Francisco, California	(4)	1	2015	110,050	99.7	%	10,815		98.55
350 Mission Street, San Francisco, California	(3)	1	2016	455,340	99.7	%	24,076		53.09
360 Third Street, San Francisco, California	(4)	1	2013	429,796	88.8	%	27,649		72.59
1800 Owens Street, San Francisco, California	(3)	1	2020	750,370	99.6	%	56,437		75.55
345 Oyster Point Boulevard, South San Francisco, California	(3)	1	2001	40,410	100.0	%	2,192		54.24
347 Oyster Point Boulevard, South San Francisco, California	(3)	1	1998	39,780	100.0	%	2,158		54.24
349 Oyster Point Boulevard, South San Francisco, California	(3)	1	1999	65,340	100.0	%	3,378		51.70
505 North Mathilda Avenue, Sunnyvale, California	(3)	1	2014	212,322	100.0	%	9,449		44.50
555 North Mathilda Avenue, Sunnyvale, California	(3)	1	2014	212,322	100.0	%	9,449		44.50
599 North Mathilda Avenue, Sunnyvale, California	(3)	1	2000	76,031	100.0	%	3,610		47.48
605 North Mathilda Avenue, Sunnyvale, California	(3)	1	2014	162,785	100.0	%	7,244		44.50
Subtotal/Weighted Average – San Francisco		32		6,276,114	94.5	%	$	389,078	$	65.96
Greater Seattle
601 108th Avenue North East, Bellevue, Washington	(33)	1	2000	488,470	93.7	%	$	17,338	$	38.29
10900 North East 4th Street, Bellevue, Washington	(34)	1	1983	428,557	84.7	%	13,721		37.95
837 North 34th Street, Lake Union, Washington	(3)	1	2008	112,487	100.0	%	4,092		36.37
701 North 34th Street, Lake Union, Washington	(3)	1	1998	141,860	100.0	%	5,318		37.49
801 North 34th Street, Lake Union, Washington	(16)	1	1998	169,412	100.0	%	5,789		34.17
320 Westlake Avenue North, Lake Union, Washington	(3)	1	2007	184,644	100.0	%	8,221		44.53
321 Terry Avenue North, Lake Union, Washington	(3)	1	2013	135,755	100.0	%	5,713		42.09
401 Terry Avenue North, Lake Union, Washington	(16)	1	2003	140,605	100.0	%	7,008		49.84
Subtotal/Weighted Average – Greater Seattle		8		1,801,790	94.7	%	$	67,200	$	39.55
TOTAL/WEIGHTED AVERAGE		117		14,620,166	91.2	%	$	711,622	$	53.97

____________________

(1)Based on all leases at the respective properties in effect as of December 31, 2020. Includes month-to-month leases as of December 31, 2020. Represents physical and economic occupancy.

(2)Annualized base rental revenue includes the impact of straight-lining rent escalations and the amortization of free rent periods and excludes the impact of the following: amortization of deferred revenue related to tenant-funded tenant improvements, amortization of above/below market rent, amortization for lease incentives due under existing leases and expense reimbursement revenue. Excludes month-to-month leases and vacant space as of December 31, 2020. Includes 100% of annualized base rent of consolidated property partnerships.

(3)For these properties, the leases are written on a triple net basis.

(4)For these properties, the leases are written on a modified gross basis.

(5)For this property, leases of approximately 264,000 rentable square feet are written on a modified gross basis and approximately 35,000 rentable square feet are written on a full service gross basis.

42

(6)For this property, leases of approximately 214,000 rentable square feet are written on a full service gross basis and approximately 4,000 rentable square feet are written on a triple net basis.

(7)For this property, leases of approximately 110,000 rentable square feet are written on a full service gross basis and approximately 10,000 rentable square feet are written on a gross basis.

(8)For this property, leases of approximately 8,000 rentable square feet are written on a triple net basis, approximately 6,000 rentable square feet are written on a gross basis, and approximately 5,000 rentable square feet are written on a full service gross basis.

(9)For this property, leases of approximately 236,000 rentable square feet are written on a modified gross basis and approximately 15,000 rentable square feet are written on a full service gross basis.

(10)For these properties, the leases are written on a full service gross basis.

(11)For this property, leases of approximately 282,000 rentable square feet are written on a full service gross basis, approximately 15,000 rentable square feet are written on a triple net basis and approximately 4,000 rentable square feet are written on a modified gross basis.

(12)For this property, leases of approximately 50,000 rentable square feet are written on a full service gross basis and approximately 46,000 rentable square feet are written on a modified net basis.

(13)For this property, leases of approximately 26,000 rentable square feet are written on a full service gross basis and approximately 19,000 rentable square feet are written on a triple net basis.

(14)For this property, leases of approximately 74,000 rentable square feet are written on a full service gross basis and approximately 26,000 rentable square feet are written on a modified gross basis.

(15)For this property, leases of approximately 57,000 rentable square feet are written on a modified gross basis, approximately 10,000 rentable square feet are written on a gross basis.

(16)For these properties, the leases are written on a modified net basis.

(17)For this property, leases of approximately 67,000 rentable square feet are written on a full service gross basis and approximately 4,000 rentable square feet are written on a triple net basis.

(18)For this property, leases of approximately 23,000 rentable square feet are written on a modified gross basis and approximately 21,000 rentable square feet are written on a full service gross basis.

(19)For this property, leases of approximately 29,000 rentable square feet are written on a full service gross basis and approximately 4,000 rentable square feet are written on a modified gross basis.

(20)For this property, leases of approximately 45,000 rentable square feet are written on a full service gross basis and approximately 3,000 rentable square feet are written on a modified gross basis.

(21)For this property, leases of approximately 30,000 rentable square feet are written on a triple net basis and approximately 17,000 rentable square feet are written on a modified gross basis.

(22)For this property, leases of approximately 48,000 rentable square feet are written on a modified gross basis and approximately 5,000 rentable square feet are written on a full service gross basis.

(23)For this property, leases of approximately 87,000 rentable square feet are written on a modified gross basis and approximately 41,000 rentable square feet are written on a full service gross basis.

(24)For this property, leases of approximately 92,000 rentable square feet are written on a modified gross basis and approximately 23,000 rentable square feet are written on a full service gross basis.

(25)For this property, leases of approximately 37,000 rentable square feet are written on a full service gross basis and approximately 5,000 rentable square feet are written on a modified gross basis.

(26)For this property, leases of approximately 132,000 rentable square feet are written on a full service gross basis, and approximately 2,000 rentable square feet are written on a modified gross basis.

(27)For this property, leases of approximately 91,000 rentable square feet are written on a modified gross basis and approximately 39,000 rentable square feet are written on a full service gross basis.

(28)For this property, leases of approximately 74,000 rentable square feet are written on a full service gross basis, approximately 23,000 rentable square feet are written on a gross basis and approximately 4,000 rentable square feet are written on a modified gross basis.

(29)For this property, leases of approximately 297,000 rentable square feet are written on a modified gross basis, approximately 97,000 rentable square feet are written on a full service gross basis, approximately 75,000 rentable square feet are written on a gross basis, and approximately 8,000 rentable square feet are written on a triple net basis.

(30)For this property, leases of approximately 224,000 rentable square feet are written on a full service gross basis, approximately 76,000 rentable square feet are written on a modified gross basis, and approximately 13,000 rentable square feet are written on a triple net basis.

(31)For this property, leases of approximately 619,000 rentable square feet are written on a modified gross basis, approximately 84,000 rentable square feet are written on a full service gross basis, approximately 39,000 rentable square feet are written on a gross basis and approximately 23,000 rentable square feet are written on a triple net basis.

(32)For this property, leases of approximately 182,000 rentable square feet are written on a modified gross basis and approximately 4,000 rentable square feet are written on a triple net basis.

(33) For this property, leases of approximately 451,000 rentable square feet are written on a triple net basis and approximately 7,000 rentable square feet are written on a modified gross basis.

(34)For this property, leases of approximately 213,000 rentable square feet are written on a triple net basis and approximately 211,000 rentable square feet are written on a full service gross basis.

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Stabilized Development Projects

During the year ended December 31, 2020, the following properties were added to our stabilized portfolio of operating properties:

		Construction Period
Stabilized Office and Retail Development Projects (1)	Location	Start Date	Completion Date	Stabilization Date (2)	Rentable Square Feet	% Occupied (3)
The Exchange on 16th	San Francisco	2Q 2015	1Q 2020	1Q 2020	750,370	100%
One Paseo - Retail	Del Mar	4Q 2016	1Q 2020	1Q 2020	95,871	92%
Netflix // On Vine	Hollywood	1Q 2018	4Q 2020	4Q 2020	361,388	100%
TOTAL:					1,207,629	99%

____________________

(1)Our stabilized office portfolio includes stabilized retail space.

(2)For office and retail, represents the earlier of anticipated 95% occupancy date or one year from cessation of major base building construction activities.

(3)Represents physical and economic occupancy.

During the year ended December 31, 2020, we completed construction on the second and third phases of our One Paseo residential development project. As of December 31, 2020, all three phases of the project were completed and added to the stabilized portfolio. The following table sets forth information about each of the phases:

		Construction Period
Completed Residential Development Project	Location	Start Date	Completion Date	Number of Units	% Leased (1)
One Paseo - Residential Phase I	Del Mar	4Q 2016	3Q 2019	237	78%
One Paseo - Residential Phase II	Del Mar	4Q 2016	1Q 2020	225	52%
One Paseo - Residential Phase III	Del Mar	4Q 2016	3Q 2020	146	50%
TOTAL:				608	62%

____________________

(1)The % leased is as of February 1, 2021.

In-Process Development Projects and Future Development Pipeline

The following tables set forth certain information relating to our in-process development pipeline as of December 31, 2020.

	Location	Construction Start Date	Estimated Stabilization Date (2)	Estimated Rentable Square Feet	Total Project % Leased	Total Project % Occupied (3)
TENANT IMPROVEMENT (1)
Office
San Diego County
One Paseo - Office	Del Mar	4Q 2018	3Q 2021	285,000	93%	66%
9455 Towne Centre Drive	University Towne Center	1Q 2019	1Q 2021	160,000	100%	—%
Greater Seattle
333 Dexter	South Lake Union	2Q 2017	3Q 2022	635,000	100%	49%
TOTAL:				1,080,000	98%	46%

____________________

(1)Represents projects that have reached cold shell condition and are ready for tenant improvements, which may require additional major base building construction before being placed in service.

(2)For office and retail, represents the earlier of anticipated 95% occupancy date or one year from substantial completion of base building components. For multi-phase projects, interest and carry cost capitalization may cease and recommence driven by various factors, including tenant improvement construction and other tenant related timing or project scope. The timing of completion of our projects may be impacted by factors outside of our control, including government restrictions and/or social distancing requirements on construction projects due to the COVID-19 pandemic. As of the date of this report, all of our in-process development projects were under active construction.

(3)Represents physical and economic occupancy.

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		Construction Start Date	Estimated Stabilization Date (1)	Estimated Rentable Square Feet	Office % Leased
UNDER CONSTRUCTION	Location
Office/Life Science
San Francisco Bay Area
Kilroy Oyster Point - Phase I	South San Francisco	1Q 2019	4Q 2021	656,000	100%
San Diego County
2100 Kettner	Little Italy	3Q 2019	2Q 2022	200,000	—%
Residential
Greater Los Angeles
Jardine (Living // On Vine)	Hollywood	4Q 2018	1Q 2021	193 Resi Units	N/A
TOTAL:					77%

____________________

(1)For office and retail, represents the earlier of anticipated 95% occupancy date or one year from substantial completion of base building components. For multi-phase projects, interest and carry cost capitalization may cease and recommence driven by various factors, including tenant improvement construction and other tenant related timing or project scope. The timing of completion of our projects may be impacted by factors outside of our control, including government restrictions and/or social distancing requirements on construction projects due to the COVID-19 pandemic. As of the date of this report, all of our in-process development projects were under active construction.

The following table sets forth certain information relating to our future development pipeline as of December 31, 2020.

Future Development Pipeline	Location	Approx. Developable Square Feet (1)
San Diego County
Santa Fe Summit – Phases II and III	56 Corridor	600,000 - 650,000
Kilroy East Village	East Village	TBD
San Francisco Bay Area
Kilroy Oyster Point - Phases II - IV	South San Francisco	1,750,000 - 1,900,000
Flower Mart	SOMA	2,300,000
Greater Seattle
SIX0 - Office & Residential	Seattle CBD	TBD

____________________

(1)The developable square feet and scope of projects could change materially from estimated data provided due to one or more of the following: any significant changes in the economy, market conditions, our markets, tenant requirements and demands, construction costs, new supply, regulatory and entitlement processes or project design.

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Significant Tenants

The following table sets forth information about our 15 largest tenants based upon annualized base rental revenues, as defined below, as of December 31, 2020.

Tenant Name	Region	Annualized Base Rental Revenue(1)(2)		Percentage of Total Annualized Base Rental Revenue(1)	Lease Expiration Date
		(in thousands)
Dropbox, Inc.	San Francisco Bay Area	$	55,998	7.7%	November 2033
GM Cruise, LLC	San Francisco Bay Area	36,337		5.0%	November 2031
LinkedIn Corporation / Microsoft Corporation	San Francisco Bay Area	29,752		4.1%	Various (4)
Adobe Systems, Inc.	San Francisco Bay Area / Greater Seattle	27,897		3.8%	Various (5)
salesforce.com, inc.	San Francisco Bay Area	24,076		3.3%	Various (6)
DIRECTV, LLC (3)	Greater Los Angeles	23,152		3.2%	September 2027
Box, Inc.	San Francisco Bay Area	22,441		3.1%	Various (7)
Okta, Inc.	San Francisco Bay Area	22,387		3.1%	October 2028
Netflix, Inc.	Greater Los Angeles	21,959		3.0%	Various (8)
DoorDash, Inc.	San Francisco Bay Area	18,650		2.6%	January 2032
Synopsys, Inc.	San Francisco Bay Area	15,492		2.1%	August 2030
Fortune 50 Publicly-Traded Company	Greater Seattle	15,355		2.1%	July 2033
Riot Games, Inc.	Greater Los Angeles	15,152		2.1%	Various (9)
Amazon.com	Greater Seattle	14,760		2.0%	Various (10)
Viacom International, Inc.	Greater Los Angeles	13,718		1.9%	December 2028
Total		$	357,126	49.1%

_____________________

(1)Annualized base rental revenue includes the impact of straight-lining rent escalations and the amortization of free rent periods and excludes the impact of the following: amortization of deferred revenue related tenant-funded tenant improvements, amortization of above/below market rents, amortization for lease incentives due under existing leases, and expense reimbursement revenue. Excludes month-to-month leases and vacant space as of December 31, 2020.

(2)Includes 100% of the annualized base rental revenues of consolidated property partnerships.

(3)The Company is currently in discussions with tenant regarding tenant's termination option as of December 31, 2020 on up to approximately 150,000 square feet of space. The Company believes tenant did not validly exercise its termination option.

(4)The LinkedIn Corporation / Microsoft Corporation leases, which contribute $3.6 million and $26.2 million, expire in October 2024 and September 2026, respectively.

(5)The Adobe Systems Inc. leases, which contribute $1.1 million, $5.8 million, and $21.0 million, expire in June 2027, July 2031 and August 2031, respectively.

(6)The salesforce.com, inc. leases, which contribute $0.6 million and $23.5 million, expire in May 2031 and September 2032, respectively.

(7)The Box, Inc. leases, which contribute $2.0 million and $20.4 million, expire in August 2021 and June 2028, respectively.

(8)The Netflix, Inc leases, which contribute $0.1 million and $21.9 million, expire in June 2021 and July 2032, respectively.

(9)The Riot Games leases, which contribute $5.7 million, $2.2 million, and $7.3 million, expire in March 2023, November 2023, and November 2024, respectively.

(10)The Amazon.com leases, which contribute $2.4 million and $12.4 million, expire in January 2023 and February 2030, respectively.

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The following pie chart sets forth the composition of our tenant base by industry and as a percentage of our annualized base rental revenue based on the North American Industry Classification System as of December 31, 2020.

Our West Coast markets are dynamic and populated with innovative and creative tenants, including but not limited to technology, entertainment and digital media. While technology companies comprise 58% of our office portfolio base rent, technology is a broad concept that encompasses diverse industries including software, social media, hardware, cloud computing, internet media and technology services.

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Lease Expirations

The following table sets forth a summary of our office lease expirations for each of the next ten years beginning with 2021, assuming that none of the tenants exercise renewal options or termination rights. See further discussion of our lease expirations under “Item 1A. Risk Factors” and “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations —Factors that May Influence Future Results of Operations”.

Lease Expirations

Year of Lease Expiration	# of Expiring Leases	Total Square Feet	% of Total Leased Square Feet		Annualized Base Rent (000’s)(1) (2)		% of Total Annualized Base Rent (1)		Annualized Rent per Square Foot (1)
2021 (3)	70	582,179	4.4	%	$	25,788	3.6	%	$	44.30
2022 (3)	72	865,679	6.6	%	37,112		5.2	%	42.87
2023	77	1,198,043	9.1	%	63,426		8.9	%	52.94
2024	58	978,481	7.5	%	48,005		6.8	%	49.06
2025	53	672,538	5.1	%	32,050		4.5	%	47.66
2026	39	1,635,749	12.5	%	74,225		10.4	%	45.38
2027 (4)	36	1,269,396	9.7	%	51,539		7.2	%	40.60
2028	22	928,925	7.1	%	58,150		8.2	%	62.60
2029	20	813,854	6.2	%	46,728		6.6	%	57.42
2030	32	1,241,437	9.5	%	66,648		9.4	%	53.69
2031 and beyond	30	2,944,267	22.3	%	207,953		29.2	%	70.63
Total (5)	509	13,130,548	100.0	%	$	711,624	100.0	%	$	54.20

____________________

(1)Annualized base rent includes the impact of straight-lining rent escalations and the amortization of free rent periods and excludes the impact of the following: amortization of deferred revenue related tenant-funded tenant improvements, amortization of above/below market rents, amortization for lease incentives due under existing leases and expense reimbursement revenue. Additionally, the underlying leases contain various expense structures including full service gross, modified gross and triple net. Amounts represent percentage of total portfolio annualized contractual base rental revenue.

(2)Includes 100% of annualized based rent of consolidated property partnerships.

(3)Adjusting for leasing transactions executed as of December 31, 2020 but not yet commenced, the 2021 and 2022 expirations would be reduced by 121,554 and 38,806 square feet, respectively.

(4)The Company is currently in discussions with a tenant regarding its termination option as of December 31, 2020 on up to approximately 150,000 square feet of space. The Company believes the tenant did not validly exercise its termination option.

(5)For leases that have been renewed early with existing tenants, the expiration date and annualized base rent information presented takes into consideration the renewed lease terms. Excludes leases not commenced as of December 31, 2020, space leased under month-to-month leases, storage leases, vacant space and future lease renewal options not executed as of December 31, 2020.

Secured Debt

As of December 31, 2020, the Operating Partnership had two outstanding mortgage notes payable which were secured by certain of our properties. Our secured debt represents an aggregate principal indebtedness of approximately $254.4 million. See additional information regarding our secured debt in “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Liquidity Sources,” Notes 8 and 9 to our consolidated financial statements and Schedule III—Real Estate and Accumulated Depreciation included in this report. Management believes that, as of December 31, 2020, the value of the properties securing the applicable secured obligations in each case exceeded the principal amount of the outstanding obligation.

ITEM 3.    LEGAL PROCEEDINGS

We and our properties are subject to routine litigation incidental to our business. These matters are generally covered by insurance. As of December 31, 2020, we were not a defendant in, and our properties were not subject to, any legal proceedings that we believe, if determined adversely to us, would have a material adverse effect upon our financial condition, results of operations, or cash flows.

ITEM 4.    MINE SAFETY DISCLOSURES

None.

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PART II

ITEM 5.    MARKET FOR KILROY REALTY CORPORATION’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

The Company’s common stock is traded on the New York Stock Exchange (“NYSE”) under the symbol “KRC.” As of the date this report was filed, there were approximately 98 registered holders of the Company’s common stock. The following table illustrates dividends declared during 2020 and 2019 as reported on the NYSE.

2020	Per Share Common Stock Dividends Declared
First quarter	$	0.4850
Second quarter	0.4850
Third quarter	0.5000
Fourth quarter	0.5000
2019	Per Share Common Stock Dividends Declared
First quarter	$	0.4550
Second quarter	0.4850
Third quarter	0.4850
Fourth quarter	0.4850

The Company pays distributions to common stockholders quarterly each January, April, July and October, at the discretion of the board of directors. Distribution amounts depend on our FFO, financial condition, capital requirements, the annual distribution requirements under the REIT provisions of the Code and such other factors as the board of directors deems relevant.

The table below reflects our purchases of equity securities during the three month period leading up to December 31, 2020.

Period	Total Number of Shares (or Units) Purchased (1)	Average Price Paid per Share (or Units)		Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs	Maximum Number (or Approximate Dollar Value) that May Yet be Purchased Under the Plans or Programs
October 1 - October 31, 2020	2,404	$	52.63	—	—
November 1 - November 30, 2020	—	—		—	—
December 1 - December 31, 2020	1,113	61.27		—	—
Total	3,517	$	55.36	—	—

_______________________

(1)Represents shares of common stock remitted to the Company to satisfy tax withholding obligations in connection with the distribution of, or the vesting and distribution of, restricted stock units or restricted stock in shares of common stock. The value of such shares of common stock remitted to the Company was based on the closing price of the Company’s common stock on the applicable withholding date.

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MARKET FOR KILROY REALTY, L.P.’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

There is no established public trading market for the Operating Partnership’s common units. As of the date this report was filed, there were 18 holders of record of common units (including through the Company’s general partnership interest).

The following table reports the distributions per common unit declared during the years ended December 31, 2020 and 2019.

2020	Per Unit Common Unit Distribution Declared
First quarter	$	0.4850
Second quarter	0.4850
Third quarter	0.5000
Fourth quarter	0.5000
2019	Per Unit Common Unit Distribution Declared
First quarter	$	0.4550
Second quarter	0.4850
Third quarter	0.4850
Fourth quarter	0.4850

During 2020 and 2019, the Operating Partnership redeemed 872,713 and 2,000 common units, respectively, for the same number of shares of the Company’s common stock.

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PERFORMANCE GRAPH

The following line graph compares the change in cumulative stockholder return on shares of the Company’s common stock to the cumulative total return of the NAREIT All Equity REIT Index, the Standard & Poor’s 500 Stock Index, and the SNL US REIT Office Index for the five-year period ended December 31, 2020. We include an additional index, the SNL US REIT Office Index, to the performance graph since management believes it provides additional information to investors about our performance relative to a more specific peer group. The SNL US REIT Office Index is a published and widely recognized index that comprises 23 office equity REITs, including us. The graph assumes the investment of $100 in us and each of the indices on December 31, 2015 and, as required by the SEC, the reinvestment of all distributions. The return shown on the graph is not necessarily indicative of future performance.

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ITEM 6.    SELECTED FINANCIAL DATA – KILROY REALTY CORPORATION

The following tables set forth selected consolidated financial and operating data on a historical basis for the Company. The following data should be read in conjunction with our financial statements and notes thereto and “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in this report.

The consolidated balance sheet data as of December 31, 2020, 2019, 2018, 2017 and 2016, the consolidated statement of operations data for all periods presented, and the consolidated statement of cash flows data for the years ended December 31, 2020, 2019, 2018 and 2017 have been derived from the historical consolidated financial statements of Kilroy Realty Corporation audited by an independent registered public accounting firm. The consolidated statement of cash flows data for the year ended December 31, 2016 has been derived from the historical consolidated financial statements of Kilroy Realty Corporation and adjusted for the impact of subsequent accounting changes requiring retrospective application, if any.

Kilroy Realty Corporation Consolidated

(in thousands, except share, per share, square footage and occupancy data)

	Year Ended December 31,
	2020		2019		2018		2017		2016
Statements of Operations Data:
Total revenues from continuing operations	$	898,397	$	837,454	$	747,298	$	719,001	$	642,572
Income from continuing operations	207,293		215,229		277,926		180,615		303,798
Net income available to common stockholders	187,105		195,443		258,415		151,249		280,538
Per Share Data:
Weighted average shares of common stock outstanding – basic	113,241,341		103,200,568		99,972,359		98,113,561		92,342,483
Weighted average shares of common stock outstanding – diluted	113,719,622		103,849,168		100,482,365		98,727,331		93,023,034
Income from continuing operations available to common stockholders per share of common stock – basic	$	1.63	$	1.87	$	2.56	$	1.52	$	3.00
Income from continuing operations available to common stockholders per share of common stock – diluted	$	1.63	$	1.86	$	2.55	$	1.51	$	2.97
Net income available to common stockholders per share – basic	$	1.63	$	1.87	$	2.56	$	1.52	$	3.00
Net income available to common stockholders per share – diluted	$	1.63	$	1.86	$	2.55	$	1.51	$	2.97
Dividends declared per share (1)	$	1.970	$	1.910	$	1.790	$	1.650	$	3.375

 ____________________

(1)Dividends declared for the year ended December 31, 2016 includes a special dividend of $1.90 per share of common stock that was paid on January 13, 2017.

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	December 31,
	2020			2019			2018			2017			2016
Balance Sheet Data:
Total real estate held for investment, before accumulated depreciation and amortization	$	10,190,046		$	9,628,773		$	8,426,632		$	7,417,777		$	7,060,754
Total assets (1)	10,000,708			8,900,094			7,765,707			6,802,838			6,706,633
Total debt	3,923,681			3,552,778			2,932,601			2,347,063			2,320,123
Total preferred stock	—			—			—			—			192,411
Total noncontrolling interests (2)	247,378			277,348			271,354			259,523			216,322
Total equity (2)	5,277,321			4,570,858			4,201,261			3,960,316			3,759,317
Other Data:
Funds From Operations (3) (4)	$	433,356		$	418,478		$	360,491		$	346,787		$	333,742
Cash flows provided by (used in):
Operating activities	$	455,590		$	386,521		$	410,043		$	347,012		$	345,054
Investing activities (5)	(542,128)			(1,228,279)			(808,915)			(359,102)			(579,420)
Financing activities	833,324			747,068			503,108			(171,241)			427,291
Office Property Data:
Rentable square footage	14,620,166			13,475,795			13,232,580			13,720,597			14,025,856
Occupancy (6)	91.2		%	94.6		%	94.4		%	95.2		%	96.0		%
Residential Property Data:
Number of units	808			200			200			200			200
Average occupancy (7)	72.0		%	82.4		%	79.7		%	70.2		%	46.0		%

_____________________

(1)    On January 1, 2019, the Company adopted FASB Topic 842 and recorded right of use ground lease assets and ground lease liabilities on its consolidate balance sheets. As of December 31, 2020 and 2019, the consolidated balance sheets included $95.5 million and $96.3 million, respectively, of right of use ground lease assets and $97.8 million and $98.4 million, respectively, of ground lease liabilities.

(2)    Includes the noncontrolling interests of the common units of the Operating Partnership and consolidated property partnerships (see Note 2 “Basis of Presentation and Significant Accounting Policies” to our consolidated financial statements included in this report for additional information).

(3)    We calculate FFO in accordance with the 2018 Restated White Paper on FFO approved by the Board of Governors of NAREIT. The White Paper defines FFO as net income or loss calculated in accordance with GAAP, excluding extraordinary items, as defined by GAAP, gains and losses from sales of depreciable real estate and impairment write-downs associated with depreciable real estate, 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. Our calculation of FFO includes the amortization of deferred revenue related to tenant-funded tenant improvements and excludes the depreciation of the related tenant improvement assets. We also add back net income attributable to noncontrolling common units of the Operating Partnership because we report FFO attributable to common stockholders and common unitholders.

We believe that FFO is a useful supplemental measure of our operating performance. The exclusion from FFO of gains and losses from the sale of operating real estate assets allows investors and analysts to readily identify the operating results of the assets that form the core of our activity and assists in comparing those operating results between periods. Also, because FFO is generally recognized as the industry standard for reporting the operations of REITs, it facilitates comparisons of operating performance to other REITs. However, other REITs may use different methodologies to calculate FFO, and accordingly, our FFO may not be comparable to all other REITs.

Implicit in historical cost accounting for real estate assets in accordance with GAAP is the assumption that the value of real estate assets diminishes predictably over time. Since real estate values have historically risen or fallen with market conditions, many industry investors and analysts have considered presentations of operating results for real estate companies using historical cost accounting alone to be insufficient. Because FFO excludes depreciation and amortization of real estate assets, we believe that FFO along with the required GAAP presentations provides a more complete measurement of our performance relative to our competitors and a more appropriate basis on which to make decisions involving operating, financing and investing activities than the required GAAP presentations alone would provide.

However, FFO should not be viewed as an alternative measure of our operating performance because 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 our properties, which are significant economic costs and could materially impact our results from operations.

Adjustments to arrive at FFO were as follows: net income attributable to noncontrolling common units of the Operating Partnership, net income attributable to noncontrolling interests in consolidated property partnerships, depreciation and amortization of real estate assets, gains on sales of depreciable real estate and FFO attributable to noncontrolling interests in consolidated property partnerships. For additional information, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations —Non-GAAP Supplemental Financial Measure: Funds From Operations” including a reconciliation of the Company’s GAAP net income available for common stockholders to FFO for the periods presented.

(4)    FFO includes amortization of deferred revenue related to tenant-funded tenant improvements of $22.5 million, $19.2 million, $18.4 million, $16.8 million and $13.2 million for the years ended December 31, 2020, 2019, 2018, 2017 and 2016, respectively.

(5)    On January 1, 2017, the Company adopted FASB ASU No. 2016-18 which requires that a statement of cash flows explain the change during the period in the total cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. As a

53

result, cash flows provided by (used in) investing activities have been adjusted from prior amounts reported to reflect this change for all periods presented.

(6) Represents physical and economic occupancy.

(7) For the year ended December 31, 2016, represents occupancy at December 31, 2016.

SELECTED FINANCIAL DATA – KILROY REALTY, L.P.

The following tables set forth selected consolidated financial and operating data on a historical basis for the Operating Partnership. The following data should be read in conjunction with our financial statements and notes thereto and “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in this report.

The consolidated balance sheet data as of December 31, 2020, 2019, 2018, 2017 and 2016, the consolidated statement of operations data for all periods presented and the consolidated statement of cash flows data for the years ended December 31, 2020, 2019, 2018 and 2017 have been derived from the historical consolidated financial statements of Kilroy Realty, L.P. audited by an independent registered public accounting firm. The consolidated statement of cash flows data for the year ended December 31, 2016 has been derived from the historical consolidated financial statements of Kilroy Realty, L.P. and adjusted for the impact of subsequent accounting changes requiring retrospective application, if any.

Kilroy Realty, L.P. Consolidated

(in thousands, except unit, per unit, square footage and occupancy data)

	Year Ended December 31,
	2020		2019		2018		2017		2016
Statements of Operations Data:
Total revenues from continuing operations	$	898,397	$	837,454	$	747,298	$	719,001	$	642,572
Income from continuing operations	207,293		215,229		277,926		180,615		303,798
Net income available to common unitholders	189,609		198,738		263,210		154,077		286,813
Per Unit Data:
Weighted average common units outstanding – basic	115,095,506		105,223,975		102,025,276		100,246,567		94,771,688
Weighted average common units outstanding – diluted	115,573,787		105,872,575		102,535,282		100,860,337		95,452,239
Income from continuing operations available to common unitholders per common unit – basic	$	1.63	$	1.87	$	2.56	$	1.52	$	2.99
Income from continuing operations available to common unitholders per common unit – diluted	$	1.62	$	1.86	$	2.55	$	1.51	$	2.96
Net income available to common unitholders per unit – basic	$	1.63	$	1.87	$	2.56	$	1.52	$	2.99
Net income available to common unitholders per unit – diluted	$	1.62	$	1.86	$	2.55	$	1.51	$	2.96
Distributions declared per common unit (1)	$	1.970	$	1.910	$	1.790	$	1.650	$	3.375

 ____________________

(1)The year ended December 31, 2016 includes a special distribution of $1.90 per common unit that was paid on January 13, 2017.

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	December 31,
	2020			2019			2018			2017			2016
Balance Sheet Data:
Total real estate held for investment, before accumulated depreciation and amortization	$	10,190,046		$	9,628,773		$	8,426,632		$	7,417,777		$	7,060,754
Total assets (1)	10,000,708			8,900,094			7,765,707			6,802,838			6,706,633
Total debt	3,923,681			3,552,778			2,932,601			2,347,063			2,320,123
Total preferred capital	—			—			—			—			192,411
Total noncontrolling interests (2)	197,503			201,100			197,561			186,375			135,138
Total capital (2)	5,277,321			4,570,858			4,201,261			3,960,316			3,759,317
Other Data:
Cash flows provided by (used in):
Operating activities	455,590			386,521			410,043			347,012			345,054
Investing activities (3)	(542,128)			(1,228,279)			(808,915)			(359,102)			(579,420)
Financing activities	833,324			747,068			503,108			(171,241)			427,291
Office Property Data:
Rentable square footage	14,620,166			13,475,795			13,232,580			13,720,597			14,025,856
Occupancy (4)	91.2		%	94.6		%	94.4		%	95.2		%	96		%
Residential Property Data:
Number of units	808			200			200			200			200
Average occupancy (5)	72.0		%	82.4		%	79.7		%	70.2		%	46.0		%

_______________________

(1)    On January 1, 2019, the Company adopted FASB Topic 842 and recorded right of use ground lease assets on its consolidated balance sheets. As of December 31, 2020 and 2019, the consolidated balance sheets included $95.5 million and $96.3 million, respectively, of right of use ground lease assets and $97.8 million and $98.4 million, respectively, of ground lease liabilities.

(2)    Includes the noncontrolling interests in consolidated property partnerships and subsidiaries (see Note 2 “Basis of Presentation and Significant Accounting Policies” to our consolidated financial statements included in this report for additional information).

(3)    On January 1, 2017, the Company adopted FASB ASU No. 2016-18 which requires that a statement of cash flows explain the change during the period in the total cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. As a result, cash flows provided by (used in) investing activities have been adjusted from prior amounts reported to reflect this change for all periods presented.

(4)    Represents physical and economic occupancy.

(5)     For the year ended December 31, 2016, represents occupancy at December 31, 2016.

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ITEM 7.     MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion relates to our consolidated financial statements and should be read in conjunction with the financial statements and notes thereto appearing elsewhere in this report. The results of operations discussion is combined for the Company and the Operating Partnership because there are no material differences in the results of operations between the two reporting entities.

Forward-Looking Statements

Statements contained in this “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” that are not historical facts may be forward-looking statements. Forward-looking statements include, among other things, statements or information concerning our plans, objectives, capital resources, portfolio performance, results of operations, projected future occupancy and rental rates, lease expirations, debt maturities, potential investments, strategies such as capital recycling, development and redevelopment activity, projected construction costs, projected construction commencement and completion dates, projected square footage of space that could be constructed on undeveloped land that we own, projected rentable square footage of or number of units in properties under construction or in the development pipeline, anticipated proceeds from capital recycling activity or other dispositions and anticipated dates of those activities or dispositions, projected increases in the value of properties, dispositions, future executive incentive compensation, pending, potential or proposed acquisitions, plans to grow our Net Operating Income and FFO, our ability to re-lease properties at or above current market rates, anticipated market conditions and demographics and other forward-looking financial data, as well as the discussion in “—Factors That May Influence Future Results of Operations,” “—Liquidity and Capital Resource of the Company,” and “—Liquidity and Capital Resources of the Operating Partnership.” Forward-looking statements can be identified by the use of words such as “believes,” “expects,” “projects,” “may,” “will,” “should,” “seeks,” “approximately,” “intends,” “plans,” “pro forma,” “estimates” or “anticipates” and the negative of these words and phrases and similar expressions that do not relate to historical matters. 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 or implied 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 remediations;

•the availability of cash for distribution and debt service and exposure to risk of default under debt obligations;

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•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 enactment or implementations of, tax laws or other applicable laws, regulations or legislation, as well as business and consumer reactions to such changes;

•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;

•our ability to maintain our status as a REIT; and

•uncertainties regarding the impact of the COVID-19 pandemic, and restrictions intended to prevent its spread, on our business and the economy generally.

The factors included in this report 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 the Company’s and the Operating Partnership’s business and financial performance, see the discussion below as well as “Item 1A. Risk Factors,” and in our other filings with the SEC. All forward-looking statements are based on information that was available and speak only as of the dates on which they were made. We assume no obligation to update any forward-looking statement 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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Company Overview

We are a self-administered REIT active in premier office and mixed-use 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 Greater Los Angeles, San Diego County, the San Francisco Bay Area and Greater Seattle, which we believe have strategic advantages and strong barriers to entry. We own our interests in all of our real properties through the Operating Partnership and generally conduct substantially all of our operations through the Operating Partnership. We owned an approximate 99.0% and 98.1% general partnership interest in the Operating Partnership as of December 31, 2020 and 2019, respectively. All of our properties are held in fee except for the fourteen office buildings that are held subject to long-term ground leases for the land (see Note 18 “Commitments and Contingencies” to our consolidated financial statements included in this report for additional information regarding our ground lease obligations).

2020 Operating and Development Highlights

We entered 2020 in a very strong financial position and drew on our strengths to manage through the pandemic. We achieved a record year in development by completing construction on $1.2 billion in projects that were turned over to our tenants for the construction of tenant improvements and 371 residential units and continued to create value that we believe will drive future earnings and dividend growth.

Development. We continued to execute on our development program during 2020. We added four completed development projects to our stabilized portfolio totaling 1.2 million rentable square feet of office and retail space and 608 residential units, had three development projects progress from the under construction phase to the tenant improvement phase and commenced revenue recognition on two development projects currently in the tenant improvement phase. See “—Factors that May Influence Future Operations” for additional information regarding our development program.

Capital Recycling Program. We have continued to utilize our capital recycling program to provide additional capital to finance development expenditures, fund potential acquisitions, repay long-term debt and for other general corporate purposes. Our general strategy, depending on market conditions, is to target the disposition of non-core properties or those that have limited upside for us and redeploy the capital into acquisitions and/or development projects where we can create additional value to generate higher returns (see “—Factors that May Influence Future Operations” for additional information). In connection with this strategy, during 2020, we generated gross sales proceeds of approximately $75.9 million through the sale of one office building.

Leasing. During 2020, we executed new and renewal leases totaling 0.7 million square feet within our stabilized portfolio with an increase in GAAP rents of 36.5% and an increase in cash rents of 18.4%. Our stabilized office portfolio was 91.2% occupied and 94.3% leased as of December 31, 2020.

2020 Financing Highlights

In 2020, we raised approximately $775.0 million in new debt at a weighted average interest rate of 3.30%, settled all 2019 forward equity sale agreements by issuing 3,147,110 shares of common stock for net proceeds of $247.3 million and entered into and settled forward equity sale agreements in connection with an offering of 5,750,000 shares of common stock for net proceeds of $474.9 million. Refer to our 2020 Financing Highlights in “—Liquidity and Capital Resources of the Operating Partnership” for a list of financing transactions completed in 2020 and Notes 9 and 13, “Secured and Unsecured Debt of the Operating Partnership” and “Stockholders’ Equity of the Company,” respectively, to our consolidated financial statements included in this report for additional information regarding our debt and capital market activity.

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COVID-19 Response

In accordance with local and state government guidance and social distancing recommendations, the majority of our employees have worked remotely since March 2020. Our robust technology infrastructure was capable of supporting this model. We implemented rigorous protocols for remote work across the Company, including increased frequency of team update calls and frequent communication across leadership and working levels. We are leveraging technology to ensure our teams stay connected and productive, and that our culture remains strong even in these unusual circumstances.

Since March 2020, we have been highly focused on planning for the health and safety of our tenants and employees and preparing our buildings in accordance with the policies, protocols and applicable legal requirements in our regions. We engaged a hygienist to assist us in designing new standard operating procedures for our buildings that include, but are not limited to, air filtration, water quality, janitorial products and procedures, social separation and screening during building access and elevator use, the use of personal protective equipment, signage, and management of construction activities. Our buildings have remained open to tenants and we have begun to see certain tenants returning to the workplace where local ordinances and restrictions allow. We have been in communication with tenants regarding return to work protocols and safety measures, which meet or exceed best practices from state and local guidelines.

We have implemented a rent relief program for the majority of our retail tenants whereby we deferred rent since April 2020 in exchange for an extension of their current lease term for an equivalent number of months at future rental rates. We expect that we will continue to offer rent relief to the majority of our retail tenants, given that most cannot resume full operations in certain of our markets where strong state and local government restrictions remain or were put back into effect, although the form of relief offered may vary in the future. We did not create such a program for our office tenants. We evaluate office rent relief requests on a specific case by case basis and only consider those which have a justifiable financial basis. Our top 15 tenants represent 49.1% of our total annualized base rental revenues and as of December 31, 2020, we had collected 100% of the rent due from our top 15 tenants since the beginning of the COVID-19 pandemic. For residential tenants, deferrals of gross rent billings have been extended in accordance with the applicable local orders, which often require repayment within 12 months if such local ordinances are not extended.

We analyze our total lease receivable balances, tenant creditworthiness, specific industry trends and conditions, and current economic trends and conditions in order to evaluate whether we believe substantially all of the amounts due under a tenant’s lease agreement are deemed probable of collection over the term of the lease. For leases that are deemed probable of collection, revenue continues to be recorded on a straight-line basis over the lease term. For leases that are deemed not probable of collection, revenue is recorded as the lesser of (i) the amount which would be recognized on a straight-line basis or (ii) cash that has been received from the tenant, with any tenant and deferred rent receivable balances charged as a direct write-off against rental income in the period of the change in the collectability determination.

The following table sets forth information regarding the percent of contractual base rent and common area maintenance (“CAM”) billings (“gross rent billings”) billed, collected, forgiven, and deferred for the three months ended December 31, 2020:

					COVID-19 Modifications (3)						Non-COVID-19 Modifications (4)
Property Type	Gross Rent Billings (1) (in thousands)		Rent Collected (2)		Rent Forgiven (5)		Rent Deferred				Rent Deferred			Rent Outstanding (8)
							Collected (6)		Outstanding (7)		Collected (6)	Outstanding (7)
Office	$	194,035	97.8	%	—		—		0.2	%	—	0.1	%	1.9	%
Residential	4,807		89.8	%	—		0.2	%	4.5	%	—	—		5.5	%
Retail	7,138		42.9	%	3.4	%	—		21.9	%	—	0.6	%	31.2	%
Total	$	205,980	95.7	%	0.1	%	—		1.1	%	—	0.1	%	3.0	%

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(1)Gross rent billings represents the total contractual base rent (including tenant direct-billed parking) and CAM billings before any COVID-19 related rent concessions for the three months ended December 31, 2020.

(2)Cash collections on billings for the three months ended December 31, 2020 as a percentage of gross rent billings.

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(3)Rent concessions that qualify for the accounting relief provided by the FASB (as described in Note 2 “Basis of Presentation and Significant Accounting Policies” to our consolidated financial statements included in this report), as total amounts due under the lease agreement are substantially the same or less than those that existed in the contract before modification.

(4)Rent concessions that do not qualify for the accounting relief provided by the FASB (as described in Note 2 “Basis of Presentation and Significant Accounting Policies” to our consolidated financial statements included in this report), as total amounts due under the lease agreement are not substantially the same as those that existed in the contract before modification, or other modifications unrelated to the COVID-19 pandemic have been included.

(5)Amounts permanently forgiven as a percentage of gross rent billings.

(6)Collections of amounts deferred under repayment plans (as described above) and through lease term extensions as a percentage of gross rent billings.

(7)Remaining amounts deferred under repayment plans and through lease term extensions as a percentage of gross rent billings.

(8)Uncollected gross rent billings that have not been forgiven and are not subject to deferral arrangements as a percentage of gross rent billings. Such amounts are subject to the Company’s collectability assessments.

The following table sets forth information regarding the percent of gross rent billings billed, collected, forgiven, and deferred for the year ended December 31, 2020:

					COVID-19 Modifications (3)						Non-COVID-19 Modifications (4)
Property Type	Gross Rent Billings (1) (in thousands)		Rent Collected (2)		Rent Forgiven (5)		Rent Deferred				Rent Deferred			Rent Outstanding (8)
							Collected (6)		Outstanding (7)		Collected (6)	Outstanding (7)
Office	$	751,382	98.5	%	—		—		0.4	%	—	0.1	%	1.0	%
Residential	17,305		92.5	%	—		1.0	%	4.9	%	—	—		1.6	%
Retail	29,080		58.6	%	3.1	%	—		23.0	%	—	0.9	%	14.4	%
Total	$	797,767	96.9	%	0.1	%	—		1.4	%	—	0.1	%	1.5	%

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(1)Gross rent billings represents the total contractual base rent (including tenant direct-billed parking) and CAM billings before any COVID-19 related rent concessions for the year ended December 31, 2020.

(2)Cash collections on billings for the year ended December 31, 2020 as a percentage of gross rent billings.

(3)Rent concessions that qualify for the accounting relief provided by the FASB (as described in Note 2 “Basis of Presentation and Significant Accounting Policies” to our consolidated financial statements included in this report), as total amounts due under the lease agreement are substantially the same or less than those that existed in the contract before modification.

(4)Rent concessions that do not qualify for the accounting relief provided by the FASB (as described in Note 2 “Basis of Presentation and Significant Accounting Policies” to our consolidated financial statements included in this report), as total amounts due under the lease agreement are not substantially the same as those that existed in the contract before modification, or other modifications unrelated to the COVID-19 pandemic have been included.

(5)Amounts permanently forgiven as a percentage of gross rent billings.

(6)Collections of amounts deferred under repayment plans (as described above) and through lease term extensions as a percentage of gross rent billings.

(7)Remaining amounts deferred under repayment plans and through lease term extensions as a percentage of gross rent billings.

(8)Uncollected gross rent billings that have not been forgiven and are not subject to deferral arrangements as a percentage of gross rent billings. Such amounts are subject to the Company’s collectability assessments.

Deferrals of gross rent billings that have been extended to office and retail tenants during the period have been formalized by the execution of lease amendments that generally provide for repayment of deferred amounts through an extension of the lease term by an equivalent period of months to the deferral period. Not all tenant relief requests will ultimately result in lease amendments and we have not relinquished our contractual rights under our lease agreements where rent concessions have not yet been granted. Our rent collections for the periods above and rent relief requests to-date may not be indicative of collections, concessions or requests in future periods.

As of February 1, 2021, across all property types, we had collected approximately 95% of our January 2021 gross rent billings, including 100% from all of our top 15 tenants. Excluding rent relief provided to certain tenants, across all property types, we collected 96% of our January 2021 gross rent billings. We are continuing to monitor the potential impact of the COVID-19 pandemic, and restrictions intended to prevent its spread, on occupancy, rental rates and rent collections. Although we are and will continue to be actively engaged in rent collection efforts related to uncollected rent for such period, as well as working with certain tenants who have requested rent deferrals, we can provide no assurance that such efforts or our efforts in future periods will be successful, particularly in the event that the COVID-19 pandemic, and restrictions intended to prevent its spread, continue for a prolonged period. Refer to “Part I, Item IA. Risk Factors” included in this report for additional information about the potential impact of the COVID-19 pandemic, and restrictions intended to prevent its spread, on our business, financial condition, results of operations, cash flows, liquidity and ability to satisfy our debt service obligations and to pay dividends and distributions to security holders.

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Critical Accounting Policies

The preparation of financial statements in conformity with GAAP requires us to make estimates, assumptions, and judgments that affect the reported amounts of assets, liabilities, and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses for the reporting periods.

Certain accounting policies are considered to be critical accounting policies. Critical accounting policies are those policies that require our management team to make significant estimates and/or assumptions about matters that are uncertain at the time the estimates and/or assumptions are made or where we are required to make significant judgments and assumptions with respect to the practical application of accounting principles in our business operations. Critical accounting policies are by definition those policies that are material to our financial statements and for which the impact of changes in estimates, assumptions, and judgments could have a material impact to our financial statements.

The following critical accounting policies discussion reflects what we believe are the most significant estimates, assumptions, and judgments used in the preparation of our consolidated financial statements. This discussion of our critical accounting policies is intended to supplement the description of our accounting policies in the footnotes to our consolidated financial statements and to provide additional insight into the information used by management when evaluating significant estimates, assumptions, and judgments. For further discussion of our significant accounting policies, see Note 2 “Basis of Presentation and Significant Accounting Policies” to our consolidated financial statements included in this report.

Revenue Recognition

Rental revenue for office and retail operating properties is our principal source of revenue. We recognize revenue from base rent, additional rent (which consists of amounts due from tenants for common area maintenance, real estate taxes and other recoverable costs), parking and other lease-related revenue once all of the following criteria are met: (i) the agreement has been fully executed and delivered, (ii) services have been rendered, (iii) the amount is fixed or determinable and (iv) payment has been received or the collectability of the amount due is probable. Lease termination fees are amortized over the remaining lease term, if applicable. If there is no remaining lease term, they are recognized when received and realized. Minimum annual rental revenues are recognized in rental revenues on a straight-line basis over the non-cancellable term of the related lease.

Base Rent

The timing of when we commence rental revenue recognition for office, life science and retail properties depends largely on our conclusion as to whether we are or the tenant is the owner for accounting purposes of tenant improvements at the leased property. When we conclude that we are the owner of tenant improvements for accounting purposes, we record the cost to construct the tenant improvements as an asset and commence rental revenue recognition when the tenant takes possession of or controls the finished space, which is generally when tenant improvements being recorded as our assets are substantially complete. In certain instances, when we conclude that the tenant is the owner of certain tenant improvements for accounting purposes, rental revenue recognition begins when the tenant takes possession or controls the physical use of the leased space, which may occur in phases or for an entire building or project. The determination of who owns the tenant improvements is made on a lease-by-lease basis and has a significant effect on the timing of commencement of revenue recognition.

The determination of whether we are or the tenant is the owner of tenant improvements for accounting purposes is subject to significant judgment. In making that determination, we consider numerous factors and perform a detailed evaluation of each individual lease. No one factor is determinative in reaching a conclusion. The factors we evaluate include but are not limited to the following:

•whether the lease agreement requires landlord approval of how the tenant improvement allowance is spent prior to installation of the tenant improvements;

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•whether the lease agreement requires the tenant to provide evidence to the landlord supporting the cost and what the tenant improvement allowance was spent on prior to payment by the landlord for such tenant improvements;

•whether the tenant improvements are unique to the tenant or reusable by other tenants;

•whether the tenant is permitted to alter or remove the tenant improvements without the consent of the landlord or without compensating the landlord for any lost utility or diminution in fair value; and

•whether the ownership of the tenant improvements remains with the landlord or remains with the tenant at the end of the lease term.

When we conclude that we are the owner of tenant improvements for accounting purposes using the factors discussed above, we record the cost to construct the tenant improvements, including costs paid for or reimbursed by the tenants, as our capital asset. During the years ended December 31, 2020, 2019, and 2018, we capitalized $15.5 million, $12.0 million, and $22.5 million, respectively, of tenant-funded tenant improvements. The amount of tenant-funded tenant improvements recorded in any given year varies based upon the mix of specific leases executed and/or commenced during the reporting period. For these tenant-funded tenant improvements, we record the amount funded by or reimbursed by tenants as deferred revenue, which is amortized and recognized as rental income on a straight-line basis over the term of the related lease beginning upon substantial completion of the leased premises. The determination of who owns the tenant improvements has a significant impact on the amount of non-cash rental revenue that we record related to the amortization of deferred revenue for tenant-funded tenant improvements. For the years ended December 31, 2020, 2019, and 2018, we recognized $22.5 million, $19.2 million and $18.4 million, respectively, of non-cash rental revenue related to the amortization of deferred revenue recorded in connection with tenant-funded tenant improvements.

When we conclude that the tenant is the owner of certain tenant improvements for accounting purposes, we record our contribution towards those tenant-owned improvements as a lease incentive, which is included in deferred leasing costs and acquisition-related intangible assets, net on our consolidated balance sheets and amortized as a reduction to rental revenue on a straight-line basis over the term of the related lease.

For residential properties, we commence revenue recognition upon lease commencement. Residential rental revenue is recognized on a straight-line basis over the term of the related lease, net of any concessions.

Additional Rent - Reimbursements from Tenants

Additional rent, consisting of amounts due from tenants for common area maintenance, real estate taxes, and other recoverable costs, are recognized in rental income in the period the recoverable costs are incurred. Prior to the adoption of Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) No. 2016-02 “Leases (Topic 842)” (“Topic 842”) on January 1, 2019, such amounts were recognized in revenue as tenant reimbursements. Additional rent where we pay the associated costs directly to third-party vendors and are reimbursed by our tenants are recognized and recorded on a gross basis, with the corresponding expense recognized in property expenses or real estate taxes. Prior to the adoption of Topic 842, recoverable costs were generally recognized and recorded on a gross basis when we were the primary obligor with respect to purchasing goods and services from third-party suppliers, had discretion in selecting the supplier, and had credit risk.

Calculating additional rent requires an in-depth analysis of the complex terms of each underlying lease. Examples of judgments and estimates used when determining the amounts recoverable include:

•estimating the final expenses, net of accruals, that are recoverable;

•estimating the fixed and variable components of operating expenses for each building;

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•conforming recoverable expense pools to those used in establishing the base year or base allowance for the applicable underlying lease; and

•concluding whether an expense or capital expenditure is recoverable pursuant to the terms of the underlying lease.

During the year, we accrue estimated additional rent in the period in which the recoverable costs are incurred based on our best estimate of the amounts to be recovered. Throughout the year, we perform analyses to properly match additional rent with reimbursable costs incurred to date. Additionally, during the fourth quarter of each year, we perform preliminary reconciliations and accrue additional rent or refunds. Subsequent to year end, we perform final detailed reconciliations and analyses on a lease-by-lease basis and bill or refund each tenant for any cumulative annual adjustments in the first and second quarters of each year for the previous year’s activity. Our historical experience for the years ended December 31, 2019 and 2018 has been that our final reconciliation and billing process resulted in final amounts that approximated the total annual additional rent recognized.

Uncollectible Lease Receivables and Allowances for Tenant and Deferred Rent Receivables

We carry our current and deferred rent receivables net of allowances for amounts that may not be collected. Prior to the adoption of Topic 842 on January 1, 2019, the allowances were increased or decreased through provision for bad debts on our consolidated statements of operations. Upon the adoption of Topic 842 on January 1, 2019, the allowances are increased or decreased through rental income, and our determination of the adequacy of the Company’s allowances for tenant receivables includes a binary assessment of whether or not substantially all of the amounts due under a tenant’s lease agreement are probable of collection. Such assessment involves using a methodology that incorporates a specific identification analysis and an aging analysis and considers the current economic and business environment. This determination requires significant judgment and estimates about matters that are uncertain at the time the estimates are made, including the creditworthiness of specific tenants, specific industry trends and conditions, and general economic trends and conditions. Since these factors are beyond our control, actual results can differ from our estimates, and such differences could be material. For leases that are deemed probable of collection, revenue continues to be recorded on a straight-line basis over the lease term. For leases that are deemed not probable of collection, revenue is recorded as the lesser of (i) the amount which would be recognized on a straight-line basis or (ii) cash that has been received from the tenant, including deferred revenue, with any tenant and deferred rent receivable balances charged as a direct write-off against rental income in the period of the change in the collectability determination.

For tenant and deferred rent receivables associated with leases whose rents are deemed probable of collection, we may record an allowance under other authoritative GAAP using a methodology that incorporates a specific identification analysis and an aging analysis and considers the current economic and business environment. This determination requires significant judgment and estimates about matters that are uncertain at the time the estimates are made, including the creditworthiness of specific tenants, specific industry trends and conditions, and general economic trends and conditions. Since these factors are beyond our control, actual results can differ from our estimates, and such differences could be material. Tenant and deferred rent receivables deemed probable of collection are carried net of allowances for uncollectible accounts, with increases or decreases in the allowances recorded through rental income on our consolidated statements of operations. Prior to the adoption of Topic 842 on January 1, 2019, the allowances were increased or decreased through provision for bad debts on our consolidated statements of operations.

Current tenant receivables consist primarily of amounts due for contractual lease payments and reimbursements of common area maintenance expenses, property taxes, and other costs recoverable from tenants. With respect to the allowance for uncollectible tenant receivables, the specific identification methodology analysis relies on factors such as the age and nature of the receivables, the payment history and financial condition of the tenant, our assessment of the tenant’s ability to meet its lease obligations, and the status of negotiations of any disputes with the tenant.

Deferred rent receivables represent the amount by which the cumulative straight-line rental revenue recorded to date exceeds cash rents billed to date under the lease agreement. With respect to the allowance for deferred rent

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receivables, given the longer-term nature of these receivables, the specific identification methodology analysis evaluates each of our significant tenants and any tenants on our internal watchlist and relies on factors such as each tenant’s financial condition and its ability to meet its lease obligations. We evaluate our reserve levels quarterly based on changes in the financial condition of tenants and our assessment of the tenant’s ability to meet its lease obligations, overall economic conditions, and the current business environment.

For the year ended December 31, 2020, we recorded a net reduction to rental revenues for direct write-offs associated with transitioning certain tenants to a cash basis of reporting and an allowance for uncollectible accounts for both current tenant receivables and deferred rent receivables of approximately 2.1% of total revenues. These amounts were primarily as a result of tenant creditworthiness considerations arising from the COVID-19 pandemic, and a portion may potentially be restored in future periods as circumstances warrant consistent with our accounting policies. For the year ended December 31, 2019, we recorded an increase to rental revenues for recoveries of prior year provision for bad debts, net of an allowance for uncollectible accounts for both current tenant receivables and deferred rent receivables, of approximately 0.3% of revenues. For the year ended December 31, 2018, we recorded a total allowance for uncollectible accounts for both current tenant receivables and deferred rent receivables of approximately 0.4% of total revenues. In the event our estimates were not accurate and we had to change our allowances by 1% of revenue from continuing operations, the potential impact to our net income available to common stockholders would be approximately $9.0 million, $8.4 million and $7.5 million for the years ended December 31, 2020, 2019 and 2018, respectively.

Acquisitions

Acquisitions of operating properties and development and redevelopment opportunities generally do not meet the definition of a business and are accounted for as asset acquisitions, as substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets. For these asset acquisitions, we record the acquired tangible and intangible assets and assumed liabilities based on each asset’s and liability’s relative fair value at the acquisition date of the total purchase price plus any capitalized acquisition costs.

We assess and consider fair value based on estimated cash flow projections that utilize available market information and discount and/or capitalization rates that we deem appropriate. Estimates of future cash flows are based on a number of factors including historical operating results, known and anticipated trends, and market and economic conditions. The acquired assets and assumed liabilities for an operating property acquisition generally include but are not limited to: land and improvements, buildings and improvements, construction in progress and identified tangible and intangible assets and liabilities associated with in-place leases, including tenant improvements, leasing costs, value of above-market and below-market operating leases and ground leases, acquired in-place lease values and tenant relationships, if any.

The fair value of land and improvements is derived from comparable sales of land and improvements within the same submarket and/or region. The fair value of buildings and improvements, tenant improvements and leasing costs considers the value of the property as if it was vacant as well as current replacement costs and other relevant market rate information.

    The fair value of the above-market or below-market component of an acquired in-place operating lease is based upon the present value (calculated using a market discount rate) of the difference between (i) the contractual rents to be paid pursuant to the lease over its remaining non-cancellable lease term and (ii) management’s estimate of the rents that would be paid using fair market rental rates and rent escalations at the date of acquisition measured over the remaining non-cancellable term of the lease for above-market operating leases and the initial non-cancellable term plus the term of any below-market fixed rate renewal options, if applicable, for below-market operating leases. The amounts recorded for above-market operating leases are included in deferred leasing costs and acquisition-related intangible assets, net on the balance sheet and are amortized on a straight-line basis as a reduction of rental income over the remaining term of the applicable leases. The amounts recorded for below-market operating leases are included in deferred revenue and acquisition-related liabilities, net on the balance sheet and are amortized on a straight-line basis as an increase to rental income over the remaining term of the applicable leases plus the term of any below-market fixed rate renewal options, if applicable. Our below-market operating leases generally do not include fixed rate or below-market renewal options. If a lease were to be terminated or if termination were

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determined to be likely prior to its contractual expiration (for example resulting from bankruptcy), amortization of the related above-market or below-market lease intangible would be accelerated.

The fair value of acquired in-place leases is derived based on management’s assessment of lost revenue and costs incurred for the period required to lease the “assumed vacant” property to the occupancy level when purchased. This fair value is based on a variety of considerations including, but not necessarily limited to: (1) the value associated with avoiding the cost of originating the acquired in-place leases; (2) the value associated with lost revenue related to tenant reimbursable operating costs estimated to be incurred during the assumed lease-up period; and (3) the value associated with lost rental revenue from existing leases during the assumed lease-up period. Factors we consider in performing these analyses include an estimate of the carrying costs during the expected lease-up periods, current market conditions, and costs to execute similar leases. In estimating carrying costs, we include real estate taxes, insurance and other operating expenses, and estimates of lost rental revenue during the expected lease-up periods based on current market demand at market rates. In estimating costs to execute similar leases, we consider leasing commissions, legal and other related expenses. The amount recorded for acquired in-place leases is included in deferred leasing costs and acquisition-related intangible assets, net on the balance sheet and amortized as an increase to depreciation and amortization expense over the remaining term of the applicable leases. If a lease were to be terminated or if termination were determined to be likely prior to its contractual expiration (for example resulting from bankruptcy), amortization of the related unamortized in-place lease intangible would be accelerated.

The determination of the fair value of any debt assumed in connection with a property acquisition is estimated by discounting the future cash flows using interest rates available for the issuance of debt with similar terms and remaining maturities.

The determination of the fair value of the acquired tangible and intangible assets and assumed liabilities of acquisitions requires us to make significant judgments and assumptions about the numerous inputs discussed above. The use of different assumptions in these fair value calculations could significantly affect the reported amounts of the allocation of our acquisition related assets and liabilities and the related depreciation and amortization expense recorded for such assets and liabilities. In addition, because the value of above and below market leases are amortized as either a reduction or increase to rental income, respectively, our judgments for these intangibles could have a significant impact on our reported rental revenues and results of operations.

Transaction costs associated with our acquisitions, including costs incurred during negotiation, are capitalized as part of the purchase price of the acquisition. During the years ended December 31, 2020, 2019 and 2018, we capitalized $0.3 million, $1.6 million, and $3.8 million, respectively, of acquisition costs.

Evaluation of Asset Impairment

We evaluate our real estate assets for potential impairment whenever events or changes in circumstances indicate that the carrying amount of a given asset may not be recoverable. We evaluate our real estate assets for impairment on a property-by-property basis. Indicators we use to determine whether an impairment evaluation is necessary include:

•low occupancy levels, forecasted low occupancy levels or near term lease expirations at a specific property;

•current period operating or cash flow losses combined with a historical pattern or future projection of potential continued operating or cash flow losses at a specific property;

•deterioration in rental rates for a specific property as evidenced by sudden significant rental rate decreases or continuous rental rate decreases over numerous quarters, which could signal a continued decrease in future cash flow for that property;

•deterioration of a given rental submarket as evidenced by significant increases in market vacancy and/or negative absorption rates or continuous increases in market vacancy and/or negative absorption rates over numerous quarters, which could signal a decrease in future cash flow for properties within that submarket;

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•significant increases in property sales yields, continuous increases in property sales yields over several quarters, or recent property sales at a loss within a given submarket, each of which could signal a decrease in the market value of properties;

•significant change in strategy or use of a specific property or any other event that could result in a decreased holding period, including classifying a property as held for sale, or significant development delay;

•evidence of material physical damage to the property; and

•default by a significant tenant when any of the other indicators above are present.

When we evaluate for potential impairment our real estate assets to be held and used, we first evaluate whether there are any indicators of impairment. If any impairment indicators are present for a specific real estate asset, we then perform an undiscounted cash flow analysis and compare the net carrying amount of the real estate asset to the real estate asset’s estimated undiscounted future cash flow over the anticipated holding period. If the estimated undiscounted future cash flow is less than the net carrying amount of the real estate asset, we perform an impairment loss calculation to determine if the fair value of the real estate asset is less than the net carrying value of the real estate asset. Our impairment loss calculation compares the net carrying amount of the real estate asset to the real estate asset’s estimated fair value, which may be based on estimated discounted future cash flow calculations or third-party valuations or appraisals. We recognize an impairment loss if the amount of the asset’s net carrying amount exceeds the asset’s estimated fair value. If we recognize an impairment loss, the estimated fair value of the asset becomes its new cost basis. For a depreciable long-lived asset, the new cost basis would be depreciated (amortized) over the remaining useful life of that asset. If a real estate asset is designated as real estate held for sale, it is carried at the lower of the net carrying value or estimated fair value less costs to sell, and depreciation ceases.

Our undiscounted cash flow and fair value calculations contain uncertainties because they require management to make assumptions and to apply judgment to estimate future cash flow and property fair values, including determining our estimated holding period and selecting the discount or capitalization rate that reflects the risk inherent in future cash flow. Estimating projected cash flow is highly subjective as it requires assumptions related to future rental rates, tenant allowances, operating expenditures, property taxes, capital improvements, and occupancy levels. We are also required to make a number of assumptions relating to future economic and market events and prospective operating trends. Determining the appropriate capitalization rate also requires significant judgment and is typically based on many factors including the prevailing rate for the market or submarket, as well as the quality and location of the properties. Further, capitalization rates can fluctuate resulting from a variety of factors in the overall economy or within regional markets. If the actual net cash flow or actual market capitalization rates significantly differ from our estimates, the impairment evaluation for an individual asset could be materially affected.

For each property where such an indicator occurred and/or for properties within a given submarket where such an indicator occurred, we completed an impairment evaluation. After completing this process, we determined that for each of the operating properties evaluated, undiscounted cash flows over the holding period were in excess of carrying value and, therefore, we did not record any impairment losses for these properties for the years ended December 31, 2020, 2019 and 2018.

Cost Capitalization and Depreciation

We capitalize costs associated with development and redevelopment activities, capital improvements, and tenant improvements, including internal compensation costs. For the years ended December 31, 2020, 2019 and 2018, we capitalized $21.8 million, $25.6 million and $24.2 million, respectively, of internal costs to our qualifying development projects. In addition, for development and redevelopment projects, we also capitalize the following costs during periods in which activities necessary to prepare the project for its intended use are in progress: interest costs based on the weighted average interest rate of our outstanding indebtedness for the period, real estate taxes and insurance.

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Amounts capitalized are depreciated or amortized over estimated useful lives determined by management. We depreciate buildings and improvements based on the estimated useful life of the asset, and we amortize tenant improvements over the shorter of the estimated useful life or estimated remaining life of the related lease. All capitalized costs are depreciated or amortized using the straight-line method.

Determining whether expenditures meet the criteria for capitalization and the assignment of depreciable lives requires management to exercise significant judgment. Expenditures that meet one or more of the following criteria generally qualify for capitalization:

•provide benefit in future periods;

•extend the useful life of the asset beyond our original estimates; and

•increase the quality of the asset beyond our original estimates.

Our historical experience has demonstrated that we have not had material write-offs of assets and that our depreciation and amortization estimates have been reasonable and appropriate.

Share-Based Incentive Compensation Accounting

At December 31, 2020, the Company had one share-based incentive compensation plan, the Kilroy Realty 2006 Incentive Award Plan, which is described more fully in Note 15 “Share-Based and Other Compensation” to our consolidated financial statements included in this report. The Executive Compensation Committee determines compensation for executive officers, as defined in Rule 16 under the Exchange Act. Compensation cost for all share-based awards, including options, requires an estimate of fair value on the grant date and compensation cost is recognized on a straight-line basis over the service vesting period, which represents the requisite service period. The grant date fair value for compensation programs that contain market conditions, like modifiers based on total stockholder return (a “market condition”), are performed using complex pricing valuation models that require the input of assumptions, including judgments to estimate expected stock price volatility, expected life, and forfeiture rate. Specifically, the grant date fair value of share-based compensation programs that include market conditions are calculated using a Monte Carlo simulation pricing model and the grant date fair value of stock option grants are calculated using the Black-Scholes valuation model. Additionally, certain of our market condition share-based compensation programs also contain pre-defined financial performance conditions, including FFO per share and debt to EBITDA ratio goals which can impact the number of restricted stock units ultimately earned. This variability relating to the level of the performance condition achieved requires management’s judgment and estimates, which impacts compensation cost recognized for these awards during the performance period. As of December 31, 2020, the performance condition for certain of our outstanding market condition share-based compensation programs has been met and compensation cost for these awards is no longer variable. For these awards, although the number of restricted stock units ultimately earned remains variable subject to the ultimate achievement level of the market condition, compensation cost is no longer variable for these awards as the market condition was already taken into consideration as part of the grant date fair value calculation. As of December 31, 2020, there are certain outstanding share-based compensation awards where the performance conditions have not all yet been met. For these awards, compensation cost and the number of restricted stock units ultimately earned remains variable and compensation cost for these awards is recorded based the estimated level of achievement of the performance conditions through the requisite service period. Changes to compensation cost resulting from changes in the estimated level of achievement of the performance conditions are recorded as cumulative adjustments in the period the change in the estimated level of achievement of the performance conditions is determined.

For the years ended December 31, 2020, 2019, and 2018 we recorded approximately $23.4 million, $18.1 million, and $23.5 million, respectively, of compensation cost related to programs that were subject to such valuation models. If the valuation of the grant date fair value for such programs changed by 10%, the potential impact to our net income available to common stockholders would be approximately $2.0 million, $1.6 million, and $2.0 million for the years ended December 31, 2020, 2019, and 2018, respectively.

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Factors That May Influence Future Results of Operations

Development Program

We believe that a portion of our long-term future growth will continue to come from the completion of our in-process development projects and, subject to market conditions, executing on our future development pipeline, including expanding entitlements. Over the past several years, we increased our focus on development opportunities and expanded our future development pipeline through targeted acquisitions of development opportunities on the West Coast.

We have a proactive planning process by which we continually evaluate the size, timing, costs and scope of our development program and, as necessary, scale activity to reflect the economic conditions and the real estate fundamentals that exist in our submarkets. We expect to execute on our development program with prudence and will be pursuing opportunities with attractive economic returns in strategic locations with proximity to public transportation or transportation access and retail amenities and in markets with strong fundamentals and visible demand. We plan to develop in phases, as appropriate, and we generally favor starting projects with pre-leasing activity.

The global impact of the COVID-19 pandemic continues to evolve rapidly and, as cases of the illness caused by the virus have continued to be identified in additional countries, many countries, including the United States, have reacted by instituting quarantines and restrictions on travel. In addition, both states where we own properties and/or have development projects (i.e., California and Washington), have reacted to the COVID-19 pandemic by instituting quarantines, restrictions on travel, “shelter in place” rules, density limitations, social distancing measures, restrictions on types of business that may continue to operate and/or restrictions on types of construction projects that may continue, although, in certain cases, exceptions are available for essential retail, research and laboratory activities, essential building services, such as cleaning and maintenance, and certain essential construction projects. Our development portfolio was largely unaffected during the year ended December 31, 2020; however, the COVID-19 pandemic, and restrictions intended to prevent its spread, may cause delays or increase costs associated with building materials or construction services necessary for construction which could adversely impact our ability to continue or complete construction as planned, on budget or at all for our development projects, and may delay the start of construction on our future development pipeline projects. Refer to “Part I , Item IA. Risk Factors” included in this report for additional information about the potential impact of the COVID-19 pandemic, and restrictions intended to prevent its spread, on our business, financial condition, results of operations, cash flows, liquidity and ability to satisfy our debt service obligations and to pay dividends and distributions to security holders.

Stabilized Development Projects

During the year ended December 31, 2020, we added the following projects to our stabilized portfolio:

•The Exchange on 16th, Mission Bay, San Francisco, California. We commenced construction on this project in June 2015. This project totals approximately 750,370 gross rentable square feet consisting of 738,081 square feet of office space and 12,289 square feet of retail space at a total estimated investment of $585.0 million. The office space in the project is 100% leased to Dropbox, Inc. We completed construction and commenced revenue recognition on the first two phases comprising approximately 82% of the project in 2019 and on the final phase of the project during the three months ended March 31, 2020.

•One Paseo (Retail) - Del Mar, San Diego, California. We commenced construction on the retail component of this mixed-use project in December 2016, which is comprised of approximately 95,871 square feet of retail space with a total estimated investment of $100.0 million. At December 31, 2020, the retail space of the project was 100% leased and 92% occupied.

•Netflix // On Vine, Hollywood, California. We commenced construction on the office component of this mixed-use project in January 2018, which includes the project’s overall infrastructure and site work and approximately 361,388 square feet of office space for a total estimated investment of $300.0 million. The

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office space of this project is 100% leased to Netflix, Inc. We completed construction and commenced revenue recognition on the entirety of this project in the fourth quarter of 2020.

•One Paseo - Residential (Phases I, II, and III) - Del Mar, San Diego, California. We commenced construction on the residential component of this mixed-use project in December 2016. Phases I, II, and III are comprised of 237, 225 and 146 residential units, respectively. We completed Phase I during the third quarter of 2019, Phase II during the first quarter of 2020, and Phase III during the third quarter of 2020. The total estimated investment for all three phases of the residential component of the project is approximately $390.0 million. As of February 1, 2021, 78% of the Phase I units were leased, 52% of the Phase II units were leased, and 50% of the Phase III units were leased.

In-Process Development Projects - Tenant Improvement

As of December 31, 2020, the following projects were in the tenant improvement phase:

•333 Dexter, South Lake Union, Seattle, Washington. We commenced construction on this project in June 2017. This project encompasses approximately 635,000 square feet of office space at a total estimated investment of $410.0 million and 100% of the project is leased to a Fortune 50 publicly traded company. In June 2020, we completed construction and commenced revenue recognition on the first phase of the project, representing approximately 49% of the project. The remaining two phases are currently expected to reach stabilization in the second half of 2022.

•One Paseo (Office) - Del Mar, San Diego, California. We commenced construction on the office component of this project in December 2018, which encompasses 285,000 square feet of office space at a total estimated investment of $205.0 million. At December 31, 2020, the office component of the project was 93% leased. We completed construction in June 2020 and as of December 31, 2020, we have commenced revenue recognition on 188,880 square feet, representing approximately 66% of the project. We currently expect the project to reach stabilization in the third quarter of 2021.

•9455 Towne Centre Drive, University Towne Center, San Diego, California. In March 2019, we commenced construction on this project which totals approximately 160,000 square feet of office space at a total estimated investment of $105.0 million. The project is 100% leased to a Fortune 50 publicly traded company. We currently expect this project to reach stabilization in the first quarter of 2021.

In-Process Development Projects - Under Construction

As of December 31, 2020, we had three projects in our in-process development pipeline that were under construction:

•Kilroy Oyster Point (Phase I), South San Francisco, California. In March 2019, we commenced construction on Phase I of this 39-acre life science campus situated on the waterfront in South San Francisco. This first phase encompasses approximately 656,000 square feet of office space at a total estimated investment of $570.0 million and is 100% leased to two tenants. We currently expect this project to reach stabilization in the fourth quarter of 2021.

•Jardine (Living // On Vine), Hollywood, California. We commenced construction on this residential project in December 2018, which encompasses 193 residential units at a total estimated investment of $200.0 million. We currently expect this project to be completed in the first quarter of 2021.

•2100 Kettner, Little Italy, San Diego, California. We commenced construction on this project in September 2019. This project is comprised of approximately 200,000 square feet of office space for a total estimated investment of $140.0 million.

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Future Development Pipeline

As of December 31, 2020, our future development pipeline included five future projects located in Greater Seattle, the San Francisco Bay Area and San Diego County with an aggregate cost basis of approximately $1.1 billion, at which we believe we could develop more than 6.0 million rentable square feet for a total estimated investment of approximately $5.0 billion to $7.0 billion, depending on successfully obtaining entitlements and market conditions.

The following table sets forth information about our future development pipeline.

Future Development Pipeline	Location	Approx. Developable Square Feet (1)	Total Costs as of 12/31/2020 ($ in millions)(2)
San Diego County
Santa Fe Summit – Phases II and III	56 Corridor	600,000 - 650,000	$	81.6
Kilroy East Village	East Village	TBD	48.2
San Francisco Bay Area
Kilroy Oyster Point - Phases II - IV	South San Francisco	1,750,000 - 1,900,000	354.7
Flower Mart	SOMA	2,300,000	433.7
Greater Seattle
SIX0 - Office & Residential	Seattle CBD	TBD	145.8
TOTAL:			$	1,064.0

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(1)The developable square feet and scope of projects could change materially from estimated data provided due to one or more of the following: any significant changes in the economy, market conditions, our markets, tenant requirements and demands, construction costs, new supply, regulatory and entitlement processes or project design.

(2)Represents cash paid and costs incurred, including accrued liabilities in accordance with GAAP, as of December 31, 2020.

Fluctuations in our development activities could cause fluctuations in the average development asset balances qualifying for interest and other carrying cost and internal cost capitalization in future periods. During the years ended December 31, 2020 and 2019, we capitalized interest on in-process development projects and future development pipeline projects with an average aggregate cost basis of approximately $2.0 billion, as it was determined these projects qualified for interest and other carrying cost capitalization under GAAP. In the event of an extended cessation of development activities, such projects may potentially no longer qualify for capitalization of interest or other carrying costs. However, a cessation of development activities caused by events outside of our control, such as those as a result of government restrictions aimed at stopping the spread of COVID-19, would not impact our ability to capitalize interest and other carrying costs. For the years ended December 31, 2020 and 2019, we capitalized $79.6 million and $81.2 million, respectively, of interest to our qualifying development projects. For the years ended December 31, 2020 and 2019, we capitalized $21.8 million and $25.6 million, respectively, of internal costs to our qualifying redevelopment and development projects.

Capital Recycling Program

We continuously evaluate opportunities for the potential disposition of non-core properties and undeveloped land in our portfolio or the formation of strategic ventures with the intent of recycling the proceeds generated into capital used to fund new operating and development acquisitions, to finance development and redevelopment expenditures, to repay long-term debt and for other general corporate purposes. As part of this strategy, we attempt to enter into Section 1031 Exchanges and other tax deferred transaction structures, when possible, to defer some or all of the taxable gains on the sales, if any, for federal and state income tax purposes. See the “Liquidity and Capital Resources of the Operating Partnership – Liquidity Sources” section for further discussion of our capital recycling activities.

In connection with our capital recycling strategy, during 2020, we completed the sale of one office property to an unaffiliated third party for total gross sales proceeds of $75.9 million. During 2019, we completed the sale of two office properties to unaffiliated third parties for total gross sales proceeds of $133.8 million.

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The timing of any potential future disposition or strategic venture transactions will depend on market conditions and other factors, including but not limited to our capital needs, the availability of financing for potential buyers (which has been and may continue to be constrained for some potential buyers due to the ongoing COVID-19 pandemic’s impact on economic and market conditions, including the financial markets), and our ability to defer some or all of the taxable gains on the sales. We cannot assure that we will dispose of any additional properties, enter into any additional strategic ventures, or that we will be able to identify and complete the acquisition of a suitable replacement property to effect a Section 1031 Exchange or be able to use other tax deferred structures in connection with our strategy. See the “Liquidity and Capital Resources of the Operating Partnership – Liquidity Sources” section for further information.

Acquisitions

As part of our growth strategy, which is highly dependent on market conditions and business cycles, among other factors, we continue to evaluate strategic opportunities and remain a disciplined buyer of development and redevelopment opportunities as well as value-add operating properties.  We focus on growth opportunities in West Coast markets populated by knowledge and creative based tenants in a variety of industries, including technology, media, healthcare, life sciences, entertainment and professional services.  Against the backdrop of market volatility, we expect to manage a strong balance sheet, execute on our development program and selectively evaluate opportunities that either add immediate Net Operating Income to our portfolio or play a strategic role in our future growth.

We did not acquire any operating or development properties during the year ended December 31, 2020. During the year ended December 31, 2019, we acquired a 19-building creative office campus and two development sites in three transactions for a total cash purchase price of $359.0 million. We generally finance our acquisitions through proceeds from the issuance of debt and equity securities, borrowings under our unsecured revolving credit facility, proceeds from our capital recycling program, the assumption of existing debt and cash flows from operations.

In connection with our growth strategy, we often have one or more potential acquisitions of properties and/or undeveloped land under consideration that are in varying stages of negotiation and due diligence review, or under contract, at any point in time. However, we cannot provide assurance that we will enter into any agreements to acquire properties, or undeveloped land, or that the potential acquisitions contemplated by any agreements we may enter into in the future will be completed. In addition, acquisitions are subject to various risks and uncertainties and we may be unable to complete an acquisition after making a nonrefundable deposit or incurring acquisition-related costs.

Incentive Compensation

Our Executive Compensation Committee determines compensation, including cash bonuses and equity incentives, for our executive officers, as defined in Rule 16 under the Exchange Act. For 2020, the annual cash bonus program was structured to allow the Executive Compensation Committee to evaluate a variety of key quantitative and qualitative metrics at the end of the year and make a determination based on the Company’s and management’s overall performance. Our Executive Compensation Committee also grants equity incentive awards from time to time that include performance-based and/or market-measure based vesting requirements and time-based vesting requirements. As a result, accrued incentive compensation and compensation expense for future awards may be affected by our operating and development performance, financial results, stock price, performance against applicable performance-based vesting goals, market conditions, liquidity measures, and other factors. Consequently, we cannot predict the amounts that will be recorded in future periods related to such incentive compensation.

As of December 31, 2020, there was approximately $35.1 million of total unrecognized compensation cost related to outstanding nonvested shares of restricted common stock and RSUs issued under share-based compensation arrangements. Those costs are expected to be recognized over a weighted-average period of 1.4 years. The ultimate amount of compensation cost recognized related to outstanding nonvested RSUs issued under share-based compensation arrangements may vary for performance-based RSUs that are still in the performance period based on performance against applicable performance-based vesting goals. The $35.1 million of unrecognized compensation cost does not reflect the future compensation cost for any potential share-based awards that may be issued subsequent to December 31, 2020. Share-based compensation expense for potential future

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awards could be affected by our operating and development performance, financial results, stock price, performance against applicable performance-based vesting goals, market conditions and other factors. For additional information regarding our equity incentive awards, see Note 15 “Share-Based and Other Compensation” to our consolidated financial statements included in this report.

Information on Leases Commenced and Executed

Leasing Activity and Changes in Rental Rates. The amount of net rental income generated by our properties depends principally on our ability to maintain the occupancy rates of currently leased space and to lease currently available space, newly developed or redeveloped properties, newly acquired properties with vacant space, and space available from unscheduled lease terminations. The amount of rental income we generate also depends on our ability to maintain or increase rental rates in our submarkets. Negative trends in one or more of these factors could adversely affect our rental income in future periods. The following tables set forth certain information regarding leasing activity for our stabilized portfolio during the year ended December 31, 2020.

For Leases Commenced

	1st & 2nd Generation (1)(2)						2nd Generation (1)(2)
	Number of Leases (3)		Rentable Square Feet (3)		Retention Rates (4)		TI/LC per Sq. Ft. (5)		TI/LC per Sq. Ft. / Year		Changes in Rents (6)(7)		Changes in Cash Rents (8)		Weighted Average Lease Term (in months)
	New	Renewal	New	Renewal
Year Ended December 31, 2020	46	34	816,300	484,771	31.6	%	$	53.94	$	9.52	41.6	%	20.0	%	68

For Leases Executed (9)

	1st & 2nd Generation (1)(2)				2nd Generation (1)(2)
	Number of Leases (3)		Rentable Square Feet (3)		TI/LC per Sq. Ft. (5)		TI/LC Per Sq. Ft. / Year		Changes in Rents (6)(7)		Changes in Cash Rents (8)		Weighted Average Lease Term (in months)
	New	Renewal	New	Renewal
Year Ended December 31, 2020	17	34	207,442	484,771	$	43.85	$	8.35	36.5	%	18.4	%	63

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(1)Includes 100% of consolidated property partnerships.

(2)First generation leasing includes space where we have made capital expenditures that result in additional revenue generated when the space is re-leased. Second generation leasing includes space where we have made capital expenditures to maintain the current market revenue stream.

(3)Represents leasing activity for leases that commenced or were signed during the period, including first and second generation space, net of month-to-month leases. Excludes leasing on new construction.

(4)Calculated as the percentage of space either renewed or expanded into by existing tenants or subtenants at lease expiration.

(5)Tenant improvements and leasing commissions per square foot exclude tenant-funded tenant improvements.

(6)Calculated as the change between GAAP rents for new/renewed leases and the expiring GAAP rents for the same space. Excludes leases for which the space was vacant longer than one year or vacant when the property was acquired.

(7)Excludes commenced and executed leases of approximately 615,639 and 61,445 rentable square feet, respectively, for the year ended December 31, 2020, for which the space was vacant longer than one year or being leased for the first time. Space vacant for more than one year is excluded from our change in rents calculations to provide a more meaningful market comparison.

(8)Calculated as the change between stated rents for new/renewed leases and the expiring stated rents for the same space. Excludes leases for which the space was vacant longer than one year or vacant when the property was acquired.

(9)For the year ended December 31, 2020, 4 new leases totaling 105,103 rentable square feet were signed but not commenced as of December 31, 2020.

Our rental rates and occupancy are impacted by general economic conditions, including the pace of regional economic growth, access to capital, and potentially the current COVID-19 pandemic and restrictions intended to prevent its spread. Therefore, we cannot give any assurance that leases will be renewed or that available space will be re-leased at rental rates equal to or above the current market rates. In addition, due to the uncertainty of current market rents as a result of the COVID-19 pandemic and the impact it has had on recent transaction volume in our markets, we are currently unable to provide meaningful information on the weighted average cash rental rates for our total stabilized portfolio compared to current market rates at December 31, 2020. In addition, it is possible that

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the COVID-19 pandemic may have an adverse impact on our ability to renew leases or re-lease available space in our properties on favorable terms or at all in the future, including as a result of a deterioration in the economic and market conditions due to restrictions intended to prevent the spread of COVID-19. These restrictions and social distancing guidelines limited our ability to physically show space to prospective tenants and impeded initiating new and progressing active leasing transactions. While we do not believe that our development leasing and ability to renew leases scheduled to expire has been significantly impacted by the COVID-19 pandemic, we do believe that the impact of the restrictions and social distancing guidelines and the economic uncertainty caused by the COVID-19 pandemic has impacted the timing and volume of leasing and may continue to do so in the future. Additionally, decreased demand, increased competition (including sublease space available from our tenants) and other negative trends or unforeseeable events that impair our ability to timely renew or re-lease space could have further negative effects on our future financial condition, results of operations, and cash flows.

Scheduled Lease Expirations. The following tables set forth certain information regarding our lease expirations for our stabilized portfolio for the next five years and by region for the next two years.

Lease Expirations (1)

Year of Lease Expiration	Number of Expiring Leases	Total Square Feet	% of Total Leased Sq. Ft.		Annualized Base Rent (2)(3)		% of Total Annualized Base Rent (2)		Annualized Base Rent per Sq. Ft. (2)
2021 (4)	70	582,179	4.4	%	$	25,788	3.6	%	$	44.30
2022 (4)	72	865,679	6.6	%	37,112		5.2	%	42.87
2023	77	1,198,043	9.1	%	63,426		8.9	%	52.94
2024	58	978,481	7.5	%	48,005		6.8	%	49.06
2025	53	672,538	5.1	%	32,050		4.5	%	47.66
Total	330	4,296,920	32.7	%	$	206,381	29.0	%	$	48.03

Year	Region	# of Expiring Leases	Total Square Feet	% of Total Leased Sq. Ft.		Annualized Base Rent (2)(3)		% of Total Annualized Base Rent (2)		Annualized Rent per Sq. Ft. (2)
2021 (4)	Greater Los Angeles	45	236,882	1.8	%	$	9,647	1.4	%	$	40.72
	San Diego County	14	101,979	0.8	%	3,788		0.5	%	37.14
	San Francisco Bay Area	9	239,351	1.8	%	12,202		1.7	%	50.98
	Greater Seattle	2	3,967	—	%	151		—	%	38.06
	Total	70	582,179	4.4	%	$	25,788	3.6	%	$	44.30
2022 (4)	Greater Los Angeles	49	480,088	3.7	%	$	21,084	3.0	%	$	43.92
	San Diego County	8	204,237	1.5	%	6,991		1.0	%	34.23
	San Francisco Bay Area	6	115,448	0.9	%	6,559		0.9	%	56.81
	Greater Seattle	9	65,906	0.5	%	2,478		0.3	%	37.60
	Total	72	865,679	6.6	%	$	37,112	5.2	%	$	42.87

_____________________ 

(1)    For leases that have been renewed early with existing tenants, the expiration date and annualized base rent information presented takes into consideration the renewed lease terms. Excludes leases not commenced as of December 31, 2020, space leased under month-to-month leases, storage leases, vacant space and future lease renewal options not executed as of December 31, 2020.

(2)    Annualized base rent includes the impact of straight-lining rent escalations and the amortization of free rent periods and excludes the impact of the following: amortization of deferred revenue related tenant-funded tenant improvements, amortization of above/below market rents, amortization for lease incentives due under existing leases, and expense reimbursement revenue. Additionally, the underlying leases contain various expense structures including full service gross, modified gross and triple net. Percentages represent percentage of total portfolio annualized contractual base rental revenue. For additional information on tenant improvement and leasing commission costs incurred by the Company for the current reporting period, please see further discussion under the caption “Information on Leases Commenced and Executed.”

(3)    Includes 100% of annualized base rent of consolidated property partnerships.

(4)    Adjusting for leases executed as of December 31, 2020 but not yet commenced, the 2021 and 2022 expirations would be reduced by 121,554 and 38,806 square feet, respectively.

In addition to the 1.3 million rentable square feet, or 8.8%, of currently available space in our stabilized portfolio, leases representing approximately 4.4% and 6.6% of the occupied square footage of our stabilized portfolio are scheduled to expire during 2021 and 2022, respectively. The leases scheduled to expire in 2021 and

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2022 represent approximately 1.4 million rentable square feet, or 8.8%, of our total annualized base rental revenue. Adjusting for leases executed as of December 31, 2020 but not yet commenced, the remaining 2021 and 2022 expirations would be 460,625 and 826,873 square feet, respectively.

Sublease Space. Of our leased space as of December 31, 2020, approximately 1.4 million rentable square feet, or 9.2% of the square footage in our stabilized portfolio, was available for sublease, primarily in the San Francisco Bay Area and Greater Seattle regions. Of the 9.2% of available sublease space in our stabilized portfolio as of December 31, 2020, approximately 7.0% was vacant space, and the remaining 2.2% was occupied. Of the approximately 1.4 million rentable square feet available for sublease as of December 31, 2020, approximately 21,124 rentable square feet representing eight leases are scheduled to expire in 2021, and approximately 79,232 rentable square feet representing ten leases are scheduled to expire in 2022.

Stabilized Portfolio Information

As of December 31, 2020, our stabilized portfolio was comprised of 117 office properties encompassing an aggregate of approximately 14.6 million rentable square feet and 808 residential units. Our stabilized portfolio includes all of our properties with the exception of development and redevelopment properties currently committed for construction, under construction or in the tenant improvement phase, undeveloped land and real estate assets held for sale. 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 properties in the tenant improvement phase as office and life science properties that we are developing or redeveloping where the project has reached cold shell condition and is ready for tenant improvements, which may require additional major base building construction before being placed in service. Projects in the tenant improvement phase are added to our stabilized portfolio once the project reaches the earlier of 95% occupancy or one year from the date of the cessation of major base building construction activities. Costs capitalized to construction in progress for development and redevelopment properties are transferred to land and improvements, buildings and improvements, and deferred leasing costs on our consolidated balance sheets as the historical cost of the property as the projects or phases of projects are placed in service.

We did not have any redevelopment or held for sale properties at December 31, 2020. Our stabilized portfolio also excludes our future development pipeline, which as of December 31, 2020 was comprised of five potential development sites, representing approximately 61 gross acres of undeveloped land on which we believe we have the potential to develop more than 6.0 million rentable square feet, depending upon economic conditions.

As of December 31, 2020, the following properties were excluded from our stabilized portfolio:

	Number of Properties/Projects	Estimated Rentable Square Feet (1)
In-process development projects - tenant improvement	3	1,080,000
In-process development projects - under construction (2)	3	856,000

________________________

(1)Estimated rentable square feet upon completion.

(2)In addition to the estimated office and life science rentable square feet noted above, development projects under construction also include 193 residential units.

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The following table reconciles the changes in the rentable square feet in our stabilized office portfolio of operating properties from December 31, 2019 to December 31, 2020:

	Number of Buildings	Rentable Square Feet
Total as of December 31, 2019	112	13,475,795
Completed development properties placed in-service	6	1,207,629
Dispositions	(1)	(87,147)
Remeasurement	—	23,889
Total as of December 31, 2020 (1)	117	14,620,166

________________________

(1)Includes four properties owned by consolidated property partnerships (see Note 2 “Basis of Presentation and Significant Accounting Policies” to our consolidated financial statements included in this report for additional information).

Occupancy Information

The following table sets forth certain information regarding our stabilized portfolio:

Stabilized Portfolio Occupancy

Region	Number of Buildings	Rentable Square Feet	Occupancy at (1)
			12/31/2020		12/31/2019		12/31/2018
Greater Los Angeles	55	4,395,556	88.1	%	95.2	%	95.1	%
Orange County	—	—	N/A		N/A		89.6	%
San Diego County	22	2,146,706	85.2	%	89.7	%	89.3	%
San Francisco Bay Area	32	6,276,114	94.5	%	95.0	%	96.4	%
Greater Seattle	8	1,801,790	94.7	%	97.7	%	93.6	%
Total Stabilized Office Portfolio	117	14,620,166	91.2	%	94.6	%	94.4	%

	Average Occupancy
	Year Ended December 31,
	2020		2019
Stabilized Office Portfolio (1)	92.6	%	93.3	%
Same Store Portfolio (2)	92.2	%	93.5	%
Residential Portfolio (3)	72.0	%	82.4	%

_____________________

(1)    Occupancy percentages reported are based on our stabilized office portfolio as of the end of the period presented and exclude occupancy percentages of properties held for sale. Represents physical and economic occupancy.

(2)    Occupancy percentages reported are based on office properties owned and stabilized as of January 1, 2019 and still owned and stabilized as of December 31, 2020. See discussion under “Results of Operations” for additional information.

(3)    At Our residential portfolio consists of our 200-unit residential tower located in Hollywood, California and 608 residential units at our One Paseo mixed-use project in Del Mar, California.

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Results of Operations

Comparison of the Year Ended December 31, 2020 to the Year Ended December 31, 2019

Net Operating Income

Management internally evaluates the operating performance and financial results of our stabilized portfolio based on Net Operating Income. We define “Net Operating Income” as consolidated operating revenues (rental income and other property income) less consolidated operating expenses (property expenses, real estate taxes and ground leases).

Net Operating Income is considered by management to be an important and appropriate supplemental performance measure to net income because we believe it helps both investors and management to understand the core operations of our properties excluding corporate and financing-related costs and non-cash depreciation and amortization. Net Operating Income is an unlevered operating performance metric of our properties and allows for a useful comparison of the operating performance of individual assets or groups of assets. This measure thereby provides an operating perspective not immediately apparent from GAAP income from operations or net income. In addition, Net Operating Income is considered by many in the real estate industry to be a useful starting point for determining the value of a real estate asset or group of assets. Other real estate companies may use different methodologies for calculating Net Operating Income, and accordingly, our presentation of Net Operating Income may not be comparable to other real estate companies. Because of the exclusion of the items shown in the reconciliation below, Net Operating Income should only be used as a supplemental measure of our financial performance and not as an alternative to GAAP income from operations or net income.

Management further evaluates Net Operating Income by evaluating the performance from the following property groups:

•Same Store Properties – includes the consolidated results of all of the office properties that were owned and included in our stabilized portfolio for two comparable reporting periods, i.e., owned and included in our stabilized portfolio as of January 1, 2019 and still owned and included in the stabilized portfolio as of December 31, 2020, including our residential tower in Hollywood, California;

•Development Properties – includes the results generated by certain of our in-process development projects, expenses for certain of our future development projects and the results generated by the following stabilized development properties:

◦One office development project that was added to the stabilized portfolio in the second quarter of 2019;

◦One office development project that was added to the stabilized portfolio in the first quarter of 2020;

◦One retail development project that was added to the stabilized portfolio in the first quarter of 2020;

◦One office development project that was added to the stabilized portfolio in the fourth quarter of 2020; and

◦608 residential units at our One Paseo mixed-use project in Del Mar, California that were added to the stabilized portfolio in the third quarter of 2020.

•Acquisition Properties – includes the results, from the dates of acquisition through the periods presented, for the 19-building creative office campus we acquired during 2019; and

•Disposition Properties – includes the results of the one property disposed of in the second quarter of 2019, the one property disposed of in the fourth quarter of 2019, and the one property disposed of in the fourth quarter of 2020.

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The following table sets forth certain information regarding the property groups within our stabilized office portfolio as of December 31, 2020.

Group	# of Buildings	Rentable Square Feet
Same Store Properties	91	12,866,289
Stabilized Development Properties (1)	7	1,601,969
Acquisition Properties	19	151,908
Total Stabilized Portfolio	117	14,620,166

________________________

(1)Excludes development projects in the tenant improvement phase, our in-process development projects and future development projects.

The following table summarizes our Net Operating Income, as defined, for our total portfolio for the years ended December 31, 2020 and 2019.

	Year Ended December 31,				Dollar Change		Percentage Change
	2020		2019
	($ in thousands)
Reconciliation of Net Income Available to Common Stockholders to Net Operating Income, as defined:
Net Income Available to Common Stockholders	$	187,105	$	195,443	$	(8,338)	(4.3)	%
Net income attributable to noncontrolling common units of the Operating Partnership	2,869		3,766		(897)		(23.8)
Net income attributable to noncontrolling interests in consolidated property partnerships	17,319		16,020		1,299		8.1
Net income	$	207,293	$	215,229	$	(7,936)	(3.7)	%
Unallocated expense (income):
General and administrative expenses	99,264		88,139		11,125		12.6
Leasing costs	4,493		7,615		(3,122)		(41.0)
Depreciation and amortization	299,308		273,130		26,178		9.6
Interest income and other net investment gain	(3,424)		(4,641)		1,217		(26.2)
Interest expense	70,772		48,537		22,235		45.8
Gains on sales of depreciable operating properties	(35,536)		(36,802)		1,266		(3.4)
Net Operating Income, as defined	$	642,170	$	591,207	$	50,963	8.6	%

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The following tables summarize our Net Operating Income, as defined, for our total portfolio for the years ended December 31, 2020 and 2019.

	Year Ended December 31,
	2020										2019
	Same Store		Develop-ment		Acquisition		Disposi-tion		Total		Same Store		Develop-ment		Acquisition		Disposi-tion		Total
	(in thousands)
Operating revenues:
Rental income	$	731,255	$	143,400	$	12,595	$	5,056	$	892,306	$	746,823	$	62,547	$	3,643	$	13,459	$	826,472
Other property income	5,088		916		87		—		6,091		9,050		1,316		37		579		10,982
Total	736,343		144,316		12,682		5,056		898,397		755,873		63,863		3,680		14,038		837,454
Property and related expenses:
Property expenses	132,950		20,377		1,443		348		155,118		146,602		10,236		367		2,832		160,037
Real estate taxes	68,687		21,090		1,884		557		92,218		66,866		9,279		370		1,582		78,097
Ground leases	7,959		—		932		—		8,891		7,953		—		160		—		8,113
Total	209,596		41,467		4,259		905		256,227		221,421		19,515		897		4,414		246,247
Net Operating Income, as defined	$	526,747	$	102,849	$	8,423	$	4,151	$	642,170	$	534,452	$	44,348	$	2,783	$	9,624	$	591,207

	Year Ended December 31, 2020 as compared to the Year Ended December 31, 2019
	Same Store				Development				Acquisition				Disposition				Total
	Dollar Change		Percent Change		Dollar Change		Percent Change		Dollar Change		Percent Change		Dollar Change		Percent Change		Dollar Change		Percent Change
	($ in thousands)
Operating revenues:
Rental income	$	(15,568)	(2.1)	%	$	80,853	129.3	%	$	8,952	245.7	%	$	(8,403)	(62.4)	%	$	65,834	8.0	%
Other property income	(3,962)		(43.8)		(400)		(30.4)		50		135.1		(579)		(100.0)		(4,891)		(44.5)
Total	(19,530)		(2.6)		80,453		126.0		9,002		244.6		(8,982)		(64.0)		60,943		7.3
Property and related expenses:
Property expenses	(13,652)		(9.3)		10,141		99.1		1,076		293.2		(2,484)		(87.7)		(4,919)		(3.1)
Real estate taxes	1,821		2.7		11,811		127.3		1,514		409.2		(1,025)		(64.8)		14,121		18.1
Ground leases	6		0.1		—		—		772		482.5		—		—		778		9.6
Total	(11,825)		(5.3)		21,952		112.5		3,362		374.8		(3,509)		(79.5)		9,980		4.1
Net Operating Income, as defined	$	(7,705)	(1.4)	%	$	58,501	131.9	%	$	5,640	202.7	%	$	(5,473)	(56.9)	%	$	50,963	8.6	%

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Net Operating Income increased $51.0 million, or 8.6%, for the year ended December 31, 2020 as compared to the year ended December 31, 2019 primarily resulting from:

•A decrease of $7.7 million attributable to the Same Store Properties which was driven by the following activity:

•A decrease in total operating revenues of $19.5 million, or 2.6%, primarily due to the following:

◦$27.2 million decrease due to the impact of COVID-19, comprised of:

◦$15.9 million decrease primarily due to charges against rental income due to tenant creditworthiness considerations and abatements provided to tenants;

◦$8.1 million decrease due to lower parking income, of which $4.1 million relates to a reduction in the number of monthly parking spaces rented as a result of COVID-19 stay-at-home orders and $4.0 million relates to lower transient and special event parking income at a number of properties in the San Francisco Bay Area, Greater Seattle and Greater Los Angeles regions. We expect daily, special event and transient parking to be impacted while restrictions intended to prevent the spread of COVID-19 are in effect; and

◦$3.2 million decrease due to lower reimbursable operating expenses;

◦$8.9 million decrease primarily due to early lease termination fees received in 2019 for two tenants in the San Francisco Bay Area;

◦$4.2 million net decrease primarily related to the improved credit quality of a tenant in 2019 for which the Company recorded a bad debt reserve in 2018;

◦$6.3 million decrease due to lower occupancy primarily in the Greater Los Angeles and San Diego County regions; and

◦$2.9 million decrease in the tenant reimbursement component of rental income primarily due to a tenant in the San Francisco Bay Area’s change from a triple net lease to a modified net lease, resulting in payment of expenses directly to vendors, and new tenants with 2020 base years; partially offset by

◦$30.3 million increase from new leases and renewals at higher rates at various properties across the portfolio;

•A decrease in property and related expenses of $11.8 million primarily due to a decrease in reimbursable expenses such as utilities, parking, janitorial, security, and various other recurring expenses due to several tenants implementing work from home policies due to the COVID-19 pandemic. We anticipate lower reimbursable property expenses and corresponding tenant recoveries as a result of lower usage of our buildings by tenants while restrictions intended to prevent the spread of COVID-19 are in effect;

•An increase of $58.5 million attributable to the Development Properties; and

•An increase of $5.6 million attributable to the Acquisition Properties; partially offset by

•A decrease of $5.5 million attributable to the Disposition Properties.

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Other Expenses and Income

General and Administrative Expenses

General and administrative expenses increased by approximately $11.1 million, or 12.6%, for the year ended December 31, 2020 compared to the year ended December 31, 2019 primarily due to the following:

•An increase of $10.7 million primarily due to increased severance costs in 2020 related to the departure of an executive officer and certain other employees, net of lower incentive compensation accruals; and

•An increase of $6.9 million primarily due to political contributions for statewide ballot measures; partially offset by

•A decrease of $4.0 million due to cost-cutting measures as a result of COVID-19, as well as lower acquisition activity; and

•A decrease of $2.5 million primarily due to the settlement of a previously disclosed litigation matter.

Leasing Costs

Leasing costs decreased by $3.1 million, or 41.0%, for the year ended December 31, 2020 compared to the year ended December 31, 2019 primarily due to a lower level of leasing activity during the year ended December 31, 2020 as a result of the COVID-19 pandemic. See the “Factors that May Influence Future Results of Operations – Information on Leases Commenced and Executed” and “Liquidity and Capital Resources of the Operating Partnership – Liquidity Uses” sections for further information.

Depreciation and Amortization

Depreciation and amortization increased by approximately $26.2 million, or 9.6%, for the year ended December 31, 2020 compared to the year ended December 31, 2019, primarily due to the following:

•A decrease of $5.7 million attributable to the Same Store Properties primarily due to write-offs related to early lease terminations and assets that became fully amortized in 2019; partially offset by

•An increase of $28.8 million attributable to the Development Properties;

•An increase of $6.3 million attributable to the Acquisition Properties; and

•A decrease of $3.2 million attributable to the Disposition Properties.

Interest Expense

The following table sets forth our gross interest expense, including debt discounts/premiums and deferred financing cost amortization and capitalized interest, including capitalized debt discounts/premiums and deferred financing cost amortization for the years ended December 31, 2020 and 2019.

	Year Ended December 31,				Dollar Change		Percentage Change
	2020		2019
	($ in thousands)
Gross interest expense	$	150,325	$	129,778	$	20,547	15.8	%
Capitalized interest and deferred financing costs	(79,553)		(81,241)		1,688		(2.1)
Interest expense	$	70,772	$	48,537	$	22,235	45.8	%

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Gross interest expense, before the effect of capitalized interest and deferred financing costs, increased $20.5 million, or 15.8%, for the year ended December 31, 2020 as compared to the year ended December 31, 2019, primarily due to an increase in the average outstanding debt balance for the year ended December 31, 2020.

Capitalized interest and deferred financing costs decreased $1.7 million, or 2.1%, for the year ended December 31, 2020 compared to the year ended December 31, 2019, primarily attributable to a decrease in the weighted average interest rate during 2020. During both years ended December 31, 2020 and 2019, we capitalized interest on in-process development projects and future development pipeline projects with an average aggregate cost basis of approximately $2.0 billion. In the event of an extended cessation of development activities to get any of these projects ready for its intended use, such projects could potentially no longer qualify for capitalization of interest or other carrying costs. However, a cessation of development activities caused by events outside of our control, such as those as a result of government restrictions aimed at stopping the spread of COVID-19, would not impact our ability to capitalize interest and other carrying costs. Refer to “Part I, Item IA. Risk Factors” included in this report for additional information about the potential impact of the COVID-19 pandemic, and restrictions intended to prevents its spread, on our business, financial condition, results of operations, cash flows, liquidity and ability to satisfy our debt service obligations and to pay dividends and distributions to security holders.

Net income attributable to noncontrolling interests in consolidated property partnerships

Net income attributable to noncontrolling interests in consolidated property partnerships increased $1.3 million, or 8.1%, for the year ended December 31, 2020 compared to the year ended December 31, 2019 primarily due to a new lease at a higher rate at one property held in a property partnership in 2020 partially offset by charges related to the creditworthiness of certain tenants. The amounts reported for the years ended December 31, 2020 and 2019 are comprised of the noncontrolling interest’s share of net income for 100 First Member, LLC (“100 First LLC”) and 303 Second Street Member, LLC (“303 Second LLC”) and the noncontrolling interest’s share of net income for Redwood LLC. See Note 11 “Noncontrolling Interests on the Company’s Consolidated Financial Statements” to our consolidated financial statements included in this report for additional information.

Comparison of the Year Ended December 31, 2019 to the Year Ended December 31, 2018

Refer to “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations –Results of Operations” in our Form 10-K for the year ended December 31, 2019 for a discussion of the year ended December 31, 2019 compared to the year ended December 31, 2018.

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Liquidity and Capital Resources of the Company

In this “Liquidity and Capital Resources of the Company” section, the term the “Company” refers only to Kilroy Realty Corporation on an unconsolidated basis and excludes the Operating Partnership and all other subsidiaries.

The Company’s business is operated primarily through the Operating Partnership. Distributions from the Operating Partnership are the Company’s primary source of capital. The Company believes the Operating Partnership’s sources of working capital, specifically its cash flow from operations and borrowings available under its unsecured revolving credit facility and funds from its capital recycling program, including strategic ventures, are adequate for it to make its distribution payments to the Company and, in turn, for the Company to make its dividend payments to its common stockholders for the next twelve months. Cash flows from operating activities generated by the Operating Partnership for the year ended December 31, 2020 were sufficient to cover the Company’s payment of cash dividends to its stockholders. However, there can be no assurance that the Operating Partnership’s sources of capital will continue to be available at all or in amounts sufficient to meet its needs, including its ability to make distributions to the Company. The unavailability of capital could adversely affect the Operating Partnership’s ability to make distributions to the Company, which would in turn, adversely affect the Company’s ability to pay cash dividends to its stockholders.

The Company is a well-known seasoned issuer and the Company and the Operating Partnership have an effective shelf registration statement that provides for the public offering and sale from time to time by the Company of its preferred stock, common stock, depositary shares, warrants and guarantees of debt securities and by the Operating Partnership of its debt securities, in each case in unlimited amounts. The Company evaluates the capital markets on an ongoing basis for opportunities to raise capital, and, as circumstances warrant, the Company and the Operating Partnership may issue securities of all of these types in one or more offerings at any time and from time to time on an opportunistic basis, depending upon, among other things, market conditions, available pricing and capital needs. When the Company receives proceeds from the sales of its preferred or common stock, it generally contributes the net proceeds from those sales to the Operating Partnership in exchange for corresponding preferred or common partnership units of the Operating Partnership. The Operating Partnership may use these proceeds and proceeds from the sale of its debt securities to repay debt, including borrowings under its unsecured revolving credit facility, to develop new or existing properties, to make acquisitions of properties or portfolios of properties, or for general corporate purposes.

As the sole general partner with control of the Operating Partnership, the Company consolidates the Operating Partnership for financial reporting purposes, and the Company does not have significant assets other than its investment in the Operating Partnership. Therefore, the assets and liabilities and the revenues and expenses of the Company and the Operating Partnership are substantially the same on their respective financial statements. The section entitled “Liquidity and Capital Resources of the Operating Partnership” should be read in conjunction with this section to understand the liquidity and capital resources of the Company on a consolidated basis and how the Company is operated as a whole.

COVID-19 Liquidity Highlights

As of the date of this report, we have no material debt maturities prior to July 2022, at which time our revolving credit facility matures. As of February 10, 2021, we had approximately $715 million in cash and cash equivalents, with an additional $750.0 million available under our unsecured revolving credit facility, as a result of settling various forward equity sale agreements and the completion of a private placement of $350.0 million in unsecured senior notes and a public offering of $425.0 million in green unsecured senior notes during the year ended December 31, 2020. We believe that this available liquidity makes us well positioned to navigate uncertainty resulting from the COVID-19 pandemic. In addition, as discussed above, the Company is a well-known seasoned issuer and has historically been able to raise capital on a timely basis in the public markets, as well as the private markets, as demonstrated by the transactions listed above. Any future financings, however, will depend on market conditions for capital raises and for the investment of any proceeds and there can be no assurances that we will successfully obtain such financings.

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Distribution Requirements

The Company is required to distribute 90% of its taxable income (subject to certain adjustments and excluding net capital gains) on an annual basis to maintain qualification as a REIT for federal income tax purposes and is required to pay income tax at regular corporate rates to the extent it distributes less than 100% of its taxable income (including capital gains). As a result of these distribution requirements, the Operating Partnership cannot rely on retained earnings to fund its on-going operations to the same extent as other companies whose parent companies are not REITs. In addition, the Company may be required to use borrowings under the Operating Partnership’s revolving credit facility, if necessary, to meet REIT distribution requirements and maintain its REIT status. The Company may also need to continue to raise capital in the equity markets to fund the Operating Partnership’s working capital needs, as well as potential developments of new or existing properties or acquisitions.

The Company intends to continue to make, but has not committed to make, regular quarterly cash distributions to common stockholders, and through the Operating Partnership, common unitholders from the Operating Partnership’s cash flow from operating activities. All such distributions are at the discretion of the Board of Directors. In 2020, the Company’s distributions exceeded 100% of its taxable income, resulting in a return of capital to its stockholders. As the Company intends to maintain distributions at a level sufficient to meet the REIT distribution requirements and minimize its obligation to pay income and excise taxes, it will continue to evaluate whether the current levels of distribution are appropriate to do so for 2021. In addition, in the event the Company is unable to identify and complete the acquisition of suitable replacement properties to effect Section 1031 Exchanges or is unable to successfully complete Section 1031 Exchanges to defer some or all of the taxable gains related to property dispositions as a result of the COVID-19 pandemic or any other reason, the Company may elect to distribute a special dividend to its common stockholders and common unitholders in order to minimize or eliminate income taxes on such gains. The Company considers market factors and its performance in addition to REIT requirements in determining its distribution levels. Amounts accumulated for distribution to stockholders are invested primarily in interest-bearing accounts and short-term interest-bearing securities, which is consistent with the Company’s intention to maintain its qualification as a REIT. Such investments may include, for example, obligations of the Government National Mortgage Association, other governmental agency securities, certificates of deposit, and interest-bearing bank deposits.

On December 10, 2020, the Board of Directors declared a regular quarterly cash dividend of $0.50 per share of common stock. The regular quarterly cash dividend is payable to stockholders of record on December 31, 2020 and a corresponding cash distribution of $0.50 per Operating Partnership units is payable to holders of the Operating Partnership’s common limited partnership interests of record on December 31, 2020, including those owned by the Company. The total cash quarterly dividends and distributions paid on January 15, 2021 were $58.6 million.

Debt Covenants

The covenants contained within certain of our unsecured debt obligations generally prohibit the Company from paying dividends during an event of default in excess of an amount which results in distributions to us in an amount sufficient to permit us to pay dividends to our stockholders that we reasonably believe are necessary to (a) maintain our qualification as a REIT for federal and state income tax purposes and (b) avoid the payment of federal or state income or excise tax.

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Capitalization

As of December 31, 2020, our total debt as a percentage of total market capitalization was 37.0%, which was calculated based on the closing price per share of the Company’s common stock of $57.40 on December 31, 2020 as shown in the following table:

	Shares/Units at  December 31, 2020	Aggregate Principal Amount or $ Value Equivalent		% of Total Market Capitalization
	($ in thousands)
Debt: (1)(2)
Unsecured Senior Notes due 2023		$	300,000	2.8	%
Unsecured Senior Notes due 2024		425,000		4.0	%
Unsecured Senior Notes due 2025		400,000		3.8	%
Unsecured Senior Notes Series A & B due 2026		250,000		2.3	%
Unsecured Senior Notes due 2028		400,000		3.8	%
Unsecured Senior Notes due 2029		400,000		3.8	%
Unsecured Senior Notes Series A & B due 2027 & 2029		250,000		2.3	%
Unsecured Senior Notes due 2030		500,000		4.6	%
Unsecured Senior Notes due 2031		350,000		3.3	%
Unsecured Senior Notes due 2032		425,000		4.0	%
Secured debt		254,365		2.3	%
Total debt		3,954,365		37.0	%
Equity and Noncontrolling Interests in the Operating Partnership: (3)
Common limited partnership units outstanding (4)	1,150,574	66,043		0.6	%
Shares of common stock outstanding	116,035,827	6,660,456		62.4	%
Total Equity and Noncontrolling Interests in the Operating Partnership		6,726,499		63.0	%
Total Market Capitalization		$	10,680,864	100.0	%

_____________________ 

(1)Represents gross aggregate principal amount due at maturity before the effect of the following at December 31, 2020: $22.4 million of unamortized deferred financing costs on the unsecured senior notes and secured debt and $8.3 million of unamortized discounts for the unsecured senior notes.

(2)As of December 31, 2020, there was no outstanding balance on the unsecured revolving credit facility. During the year ended December 31, 2020, we fully repaid the $150.0 million unsecured term loan facility.

(3)Value based on closing price per share of our common stock of $57.40 as of December 31, 2020.

(4)Includes common units of the Operating Partnership not owned by the Company; does not include noncontrolling interests in consolidated property partnerships.

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Liquidity and Capital Resources of the Operating Partnership

In this “Liquidity and Capital Resources of the Operating Partnership” section, the terms “we,” “our,” and “us” refer to the Operating Partnership or the Operating Partnership and the Company together, as the context requires.

General

Our primary liquidity sources and uses are as follows:

Liquidity Sources

•Net cash flow from operations;

•Borrowings under the Operating Partnership’s unsecured revolving credit facility;

•Proceeds from our capital recycling program, including the disposition of assets and the formation of strategic ventures;

•Proceeds from additional secured or unsecured debt financings; and

•Proceeds from public or private issuance of debt, equity or preferred equity securities.

Liquidity Uses

•Development and redevelopment costs;

•Operating property or undeveloped land acquisitions;

•Property operating and corporate expenses;

•Capital expenditures, tenant improvement and leasing costs;

•Debt service and principal payments, including debt maturities;

•Distributions to common security holders;

•Repurchases and redemptions of outstanding common stock of the Company; and

•Outstanding debt repurchases, redemptions and repayments.

General Strategy

Our general strategy is to maintain a conservative balance sheet with a strong credit profile and to maintain a capital structure that allows for financial flexibility and diversification of capital resources. We manage our capital structure to reflect a long-term investment approach and utilize multiple sources of capital to meet our long-term capital requirements. We believe that our current projected liquidity requirements for the next twelve-month period, as set forth above under the caption “—Liquidity Uses,” will be satisfied using a combination of the liquidity sources listed above, although there can be no assurance in this regard. We believe our conservative leverage and staggered debt maturities provide us with financial flexibility and enhance our ability to obtain additional sources of liquidity if necessary, and, therefore, we are well-positioned to refinance or repay maturing debt and to pursue our strategy of seeking attractive acquisition opportunities, which we may finance, as necessary, with future public and private issuances of debt and equity securities.

2020 Capital and Financing Transactions

We continue to be active in the capital markets and our capital recycling program to finance potential acquisitions and our development activity, as well as our continued desire to extend our debt maturities. This was primarily a result of the following activity:

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Capital Recycling Program

•During the year ended December 31, 2020, we completed the sale of one office building to an unaffiliated third party for gross sales proceeds totaling approximately $75.9 million.

    Capital Markets / Debt Transactions

•In addition to obtaining funding from our capital recycling program during 2020, we successfully completed the following financing and capital raising activities to fund our continued growth. We continued to strengthen our balance sheet and lower our overall cost of capital.

•Entered into and physically settled forward equity sale agreements with certain financial institutions acting as forward purchasers in connection with an offering of 5,750,000 shares of common stock at an initial offering price of $494.5 million, or $86.00 per share, before underwriting discounts, commissions and offering expenses. Upon settlement, the Company issued 5,750,000 shares of common stock for net proceeds of $474.9 million;

•Physically settled all forward equity sale agreements entered into in 2019. Upon settlement, the Company issued 3,147,110 shares of common stock for net proceeds of $247.3 million;

•Entered into a Note Purchase Agreement in connection with the issuance and sale of $350.0 million principal amount of 10-year 4.270% unsecured senior notes due January 2031 pursuant to a private placement; and

•Issued $425.0 million aggregate principal amount of 12-year 2.500% green unsecured senior notes due November 2032 in a registered public offering.

Liquidity Sources

Unsecured Revolving Credit Facility and Term Loan Facility

The following table summarizes the balance and terms of our unsecured revolving credit facility as of December 31, 2020 and 2019:

	December 31, 2020			December 31, 2019
	(in thousands)
Outstanding borrowings	$	—		$	245,000
Remaining borrowing capacity	750,000			505,000
Total borrowing capacity (1)	$	750,000		$	750,000
Interest rate (2)	1.14		%	2.76		%
Facility fee-annual rate (3)	0.200%
Maturity date	July 2022

______________________

(1)We may elect to borrow, subject to bank approval and obtaining commitments for any additional borrowing capacity, up to an additional $600.0 million under an accordion feature under the terms of the unsecured revolving credit facility and unsecured term loan facility.

(2)Our unsecured revolving credit facility interest rate was calculated based on the contractual rate of LIBOR plus 1.000% as of December 31, 2020 and 2019, respectively.

(3)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 December 31, 2020 and 2019, $2.1 million and $3.4 million of unamortized deferred financing costs, respectively, which are included in prepaid expenses and other assets, net on our consolidated balance sheets, remained to be amortized through the maturity date of our unsecured revolving credit facility.

We intend to borrow under the unsecured revolving credit facility as necessary for general corporate purposes, to finance development and redevelopment expenditures, to fund potential acquisitions, to potentially repay long-term debt and to supplement cash balances given uncertainties and volatility in market conditions.

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In August 2020, the Company repaid in full the $150.0 million unsecured term loan facility. The following table summarizes the balance and terms of our unsecured term loan facility as of December 31, 2019:

	December 31, 2019
	(in thousands)
Outstanding borrowings	$	150,000
Remaining borrowing capacity	—
Total borrowing capacity (1)	$	150,000
Interest rate (2)	2.85		%
Undrawn facility fee-annual rate	0.200%
Maturity date	July 2022

________________________

(1)As of December 31, 2019, $0.7 million of unamortized deferred financing costs, 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 the contractual rate of LIBOR plus 1.100% as of December 31, 2019.

Capital Recycling Program

As discussed in the section “Factors That May Influence Future Results of Operations - Capital Recycling Program,” we continuously evaluate opportunities for the potential disposition of properties and undeveloped land in our portfolio or the formation of strategic ventures with the intent of recycling the proceeds generated from the disposition of less strategic or non-core assets into capital used to finance development expenditures, to fund new acquisitions, to repay long-term debt and for other general corporate purposes. As part of this strategy, we attempt to enter into Section 1031 Exchanges, when possible, to defer some or all of the taxable gains on the sales, if any, for federal and state income tax purposes.

In connection with our capital recycling strategy, through December 31, 2020, we completed the sale of one property to an unaffiliated third party for gross sales proceeds totaling approximately $75.9 million. During 2019, we completed the sale of two properties to unaffiliated third parties for total gross sales proceeds totaling approximately $133.8 million. See “—Factors that May Influence Future Operations” and Note 4 “Dispositions” to our consolidated financial statements included in this report for additional information.

Any potential future disposition transactions and the timing of any potential future capital recycling transactions will depend on market conditions and other factors including but not limited to our capital needs, the availability of financing for potential buyers (which has been and may continue to be constrained for some potential buyers due to the ongoing COVID-19 pandemic’s impact on economic and market conditions, including the financial markets), and our ability to defer some or all of the taxable gains on the sales. In addition, we cannot assure you that we will dispose of any additional properties or that we will be able to identify and complete the acquisitions of suitable replacement properties to effect Section 1031 Exchanges to defer some or all of the taxable gains related to our capital recycling program. In the event we are unable to complete dispositions as planned, we may raise capital through other sources of liquidity including our available unsecured revolving credit facility or the public or private issuance of unsecured debt.

Forward Equity Offering and Settlement

On February 18, 2020, the Company entered into forward equity sale agreements with certain financial institutions acting as forward purchasers in connection with an offering of 5,750,000 shares of common stock at an initial gross offering price of $494.5 million, or $86.00 per share, before underwriting discounts, commissions and offering expenses. The forward purchasers borrowed and sold an aggregate of 5,750,000 shares of common stock in the offering.

On March 25, 2020, the Company physically settled these forward equity sale agreements. Upon settlement, the Company issued 5,750,000 shares of common stock for net proceeds of $474.9 million and contributed the net proceeds to the Operating Partnership in exchange for an equal number of units in the Operating Partnership.

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At-The-Market Stock Offering Program

Under our current at-the-market program, which commenced June 2018, we may offer and sell shares of our common stock with an aggregate gross sales price of up to $500.0 million from time to time in “at-the-market” offerings. In connection with the at-the-market program, the Company may enter into forward equity sale agreements whereby, at our discretion, the forward purchasers may borrow and sell shares of our common stock under our at-the-market program (see “Note 13. Stockholders’ Equity of the Company” to our consolidated financial statements included in this report for additional information).

During the year ended December 31, 2019, we executed various 12-month forward equity sale agreements under our at-the-market program with financial institutions acting as forward purchasers to sell 3,147,110 shares of common stock at a weighted average sales price of $80.08 per share before underwriting discounts, commissions and offering expenses.

In March 2020, we physically settled all forward equity sale agreements entered into in 2019. Upon settlement, the Company issued 3,147,110 shares of common stock for net proceeds of $247.3 million and contributed the net proceeds to the Operating Partnership in exchange for an equal number of units in the Operating Partnership. We did not enter into any forward equity sale agreements under our at-the-market program during the year ended December 31, 2020.

Since commencement of our current at-the-market program, we have completed sales of 3,594,576 shares of common stock through December 31, 2020. As of December 31, 2020, we may offer and sell shares of our common stock having an aggregate gross sales price up to approximately $214.2 million under this program.

The company did not complete any direct sales of common stock under the program during the years ended December 31, 2020 or 2019. The following table sets forth information regarding settlements of forward equity sale agreements for the year ended December 31, 2020. The Company did not settle any forward equity sale agreements during the year ended December 31, 2020.

	Year Ended December 31, 2020
	(in millions, except share and per share data)
Shares of common stock settled during the year	3,147,110
Weighted average price per share of common stock	$	80.08
Aggregate gross proceeds	$	252.0
Aggregate net proceeds after selling commissions	$	247.3

The proceeds from sales were used to fund development expenditures, and general corporate purposes. 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.

Shelf Registration Statement

The Company is a well-known seasoned issuer and the Company and the Operating Partnership have an effective shelf registration statement that provides for the public offering and sale from time to time by the Company of its preferred stock, common stock, depository shares and guarantees of debt securities and by the Operating Partnership of its debt securities, in each case in unlimited amounts. The Company evaluates the capital markets on an ongoing basis for opportunities to raise capital, and, as circumstances warrant, the Company and the Operating Partnership may issue securities of all of these types in one or more offerings at any time and from time to time on an opportunistic basis, depending upon, among other things, market conditions, available pricing and capital needs. During the year ended December 31, 2020, the Company’s stock price ranged from $46.46 to $88.28, a 90% swing, as a result of COVID-19 and the resultant impact on the capital markets and economy. If current conditions continue for an extended period of time, capital raising could be more challenging than under conditions prior to COVID-19. When the Company receives proceeds from the sales of its preferred or common stock, it generally

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contributes the net proceeds from those sales to the Operating Partnership in exchange for corresponding preferred or common partnership units of the Operating Partnership. The Operating Partnership may use these proceeds and proceeds from the sale of its debt securities to repay debt, including borrowings under its unsecured revolving credit facility, to develop new or existing properties, to make acquisitions of properties or portfolios of properties, or for general corporate purposes.

Unsecured Senior Notes - Registered Offering

In August 2020, the Operating Partnership issued $425.0 million aggregate principal amount of green unsecured senior notes in a registered public offering. The outstanding balance of the unsecured senior notes is included in unsecured debt, net of an initial issuance discount of $2.7 million, on our consolidated balance sheets. The unsecured senior notes, which are scheduled to mature on November 15, 2032, require semi-annual interest payments each May and November based on a stated annual interest rate of 2.500%. The Operating Partnership may redeem the notes at any time prior to August 15, 2032, either in whole or in part, subject to the payment of an early redemption premium prior to a par call option period commencing three months prior to maturity.

Unsecured Senior Notes - Private Placement

In April 2020, the Operating Partnership entered into a Note Purchase Agreement in connection with the issuance and sale of $350.0 million principal amount of the Operating Partnership's 4.270% Senior Notes due January 31, 2031 (the “Notes”), pursuant to a private placement. The Notes mature on their due date, unless earlier redeemed or prepaid pursuant to the terms of the Note Purchase Agreement. Interest on the Notes is payable semi-annually in arrears on April 18 and October 18 of each year beginning October 18, 2020.

Unsecured and Secured Debt

The aggregate principal amount of the unsecured and secured debt of the Operating Partnership outstanding as of December 31, 2020 was as follows:

	Aggregate Principal Amount Outstanding
	(in thousands)
Unsecured Senior Notes due 2023	$	300,000
Unsecured Senior Notes due 2024	425,000
Unsecured Senior Notes due 2025	400,000
Unsecured Senior Notes Series A & B due 2026	250,000
Unsecured Senior Notes due 2028	400,000
Unsecured Senior Notes due 2029	400,000
Unsecured Senior Notes Series A & B due 2027 & 2029	250,000
Unsecured Senior Notes due 2030	500,000
Unsecured Senior Notes due 2031	350,000
Unsecured Senior Notes due 2032	425,000
Secured Debt	254,365
Total Unsecured and Secured Debt (1)	3,954,365
Less: Unamortized Net Discounts and Deferred Financing Costs (2)	(30,684)
Total Debt, Net	$	3,923,681

________________________

(1)As of December 31, 2020, there was no outstanding balance on the unsecured revolving credit facility. During the year ended December 31, 2020, we fully repaid the $150.0 million unsecured term loan facility.

(2)Includes $22.4 million of unamortized deferred financing costs on the unsecured senior notes and secured debt and $8.3 million of unamortized discounts for the unsecured senior notes. Excludes unamortized deferred financing costs on the unsecured revolving credit facility, which are included in prepaid expenses and other assets, net on our consolidated balance sheets.

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Debt Composition

The composition of the Operating Partnership’s aggregate debt balances between secured and unsecured and fixed-rate and variable-rate debt as of December 31, 2020 and 2019 was as follows:

	Percentage of Total Debt (1)				Weighted Average Interest Rate(1)
	December 31, 2020 (2)		December 31, 2019		December 31, 2020 (2)		December 31, 2019
Secured vs. unsecured:
Unsecured	93.6	%	92.8	%	3.8	%	3.8	%
Secured	6.4	%	7.2	%	3.9	%	3.9	%
Variable-rate vs. fixed-rate:
Variable-rate	—	%	11.0	%	—	%	2.8	%
Fixed-rate (3)	100.0	%	89.0	%	3.8	%	3.9	%
Stated rate (3)					3.8	%	3.8	%
GAAP effective rate (4)					3.8	%	3.8	%
GAAP effective rate including debt issuance costs					4.0	%	4.0	%

________________________

(1)As of the end of the period presented.

(2)As of December 31, 2020, there was no outstanding balance on the unsecured revolving credit facility. During the year ended December 31, 2020, we fully repaid the $150.0 million unsecured term loan facility.

(3)Excludes the impact of the amortization of any debt discounts/premiums and deferred financing costs.

(4)Includes the impact of amortization of any debt discounts/premiums, excluding deferred financing costs.

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Liquidity Uses

Contractual Obligations

The following table provides information with respect to our contractual obligations as of December 31, 2020. The table: (i) indicates the maturities and scheduled principal repayments of our secured and unsecured debt outstanding as of December 31, 2020; (ii) indicates the scheduled interest payments of our fixed-rate debt as of December 31, 2020; (iii) provides information about the minimum commitments due in connection with our ground lease obligations and other lease and contractual commitments; and (iv) provides estimated development commitments as of December 31, 2020. Note that the table does not reflect our available debt maturity extension options and reflects gross aggregate principal amounts before the effect of unamortized discounts/premiums.

	Payment Due by Period
	Less than 1 Year (2021)		2-3 Years (2022-2023)		4-5 Years (2024-2025)		More than 5 Years (After 2025)		Total
	(in thousands)
Principal payments: secured debt (1)	$	5,342	$	11,329	$	12,252	$	225,442	$	254,365
Principal payments: unsecured debt (2)	—		300,000		825,000		2,575,000		3,700,000
Interest payments: fixed-rate debt (3)	149,448		287,322		254,874		362,323		1,053,967
Ground lease obligations (4)	5,641		11,304		11,324		280,723		308,992
Lease and other contractual commitments (5)	102,028		2,837		—		—		104,865
Development commitments (6)	363,000		147,000		—		—		510,000
Total	$	625,459	$	759,792	$	1,103,450	$	3,443,488	$	5,932,189

_____________________

(1)Represents gross aggregate principal amount before the effect of deferred financing costs of approximately $0.8 million as of December 31, 2020.

(2)Represents gross aggregate principal amount before the effect of the unamortized discount and deferred financing costs of approximately $8.3 million and $21.6 million as of December 31, 2020.

(3)As of December 31, 2020, 100.0% of our debt was contractually fixed. The information in the table above reflects our projected interest rate obligations for these fixed-rate payments based on the contractual interest rates on an accrual basis and scheduled maturity dates.

(4)Reflects minimum lease payments through the contractual lease expiration date before the impact of extension options. See Note 18 “Commitments and Contingencies” to our consolidated financial statements included in this report for further information.

(5)Amounts represent cash commitments under signed leases and contracts for operating properties, excluding tenant-funded tenant improvements, and for other contractual commitments. The timing of these expenditures may fluctuate.

(6)Amounts represent commitments under signed leases for pre-leased development projects and contractual commitments for projects in the tenant improvement phase and under construction as of December 31, 2020. The timing of these expenditures may fluctuate based on the ultimate progress of construction. We may start additional construction in 2021 (see “—Development” for additional information).

Other Liquidity Uses

Development

As of December 31, 2020, we had three development projects under construction.  These projects have a total estimated investment of approximately $910 million, of which we have incurred approximately $600 million, net of retention, and committed an additional $310 million as of December 31, 2020. In addition, as of December 31, 2020, we had three development projects in the tenant improvement phase. These projects have a total estimated investment of approximately $720 million of which we have incurred approximately $610 million, net of retention, and committed an additional $110 million as of December 31, 2020. We also had three stabilized development projects with a total estimated investment of $1.2 billion, of which approximately $64 million remains to be spent in 2021. Including the commitment information in the table above we currently believe we may spend between $400 million to $500 million on development projects throughout 2021.  Ultimate timing of these expenditures may fluctuate given construction progress and leasing status of the projects. Additionally, the COVID-19 pandemic, and restrictions intended to prevent its spread, could cause delays or increase costs associated with building materials or construction services necessary for construction in the future, which could adversely impact our ability to continue or complete construction as planned, on budget or at all, and may delay the start of construction on our future development pipeline projects. We expect that any material additional development activities will be funded with

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borrowings under the unsecured revolving credit facility, the public or private issuance of debt or equity securities, the disposition of assets under our capital recycling program, or strategic venture opportunities.

Debt Maturities

We believe our conservative leverage and staggered debt maturities provide us with financial flexibility and enhance our ability to obtain additional sources of liquidity if necessary, and, therefore, we believe we are well-positioned to refinance or repay maturing debt and to pursue our strategy of seeking attractive acquisition opportunities, which we may finance, as necessary, with future public and private issuances of debt and equity securities. However, we can provide no assurance that we will have access to the public or private debt or equity markets in the future on favorable terms or at all. Refer to “Part I, Item IA. Risk Factors” included in this report for additional information about the potential impact of the COVID-19 pandemic, and restrictions intended to prevents its spread, on our business, financial condition, results of operations, cash flows, liquidity and ability to satisfy our debt service obligations and to pay dividends and distributions to security holders. Our next debt maturity occurs in July 2022 and relates to our unsecured revolving credit facility, under which we currently do not have any amounts borrowed.

Potential Future Acquisitions

We did not acquire any operating properties during the year ended December 31, 2020. During 2019, we acquired a 19-building creative office campus and two development sites for a total of $359.0 million in cash. These transactions were funded through various capital raising activities and liquidity as discussed in “—Liquidity Sources”.

As discussed in the section “—Factors That May Influence Future Results of Operations - Acquisitions,” we continue to evaluate strategic opportunities and remain a disciplined buyer of development and redevelopment opportunities as well as value-add operating properties, dependent on market conditions and business cycles, among other factors.  We focus on growth opportunities in West Coast markets populated by knowledge and creative based tenants in a variety of industries, including technology, media, healthcare, life sciences, entertainment and professional services.  Any material acquisitions will be funded with borrowings under the unsecured revolving credit facility, the public or private issuance of debt or equity securities, the disposition of assets under our capital recycling program, the formation of strategic ventures or through the assumption of existing debt. We cannot provide assurance that we will enter into any agreements to acquire properties, or undeveloped land, or that the potential acquisitions contemplated by any agreements we may enter into in the future will be completed.

Share Repurchases

As of December 31, 2020, 4,935,826 shares remained eligible for repurchase under a share repurchase program approved by the Company’s board of directors in 2016. Under this program, repurchases may be made in open market transactions at prevailing prices or through privately negotiated transactions. We may elect to repurchase shares of our common stock under this program in the future depending upon various factors, including market conditions, the trading price of our common stock and our other uses of capital. This program does not have a termination date, and repurchases may be discontinued at any time. We intend to fund repurchases, if any, primarily with the proceeds from property dispositions.

Potential Future Leasing Costs and Capital Improvements

The amounts we incur for tenant improvements and leasing costs depend on leasing activity in each period. Tenant improvements and leasing costs generally fluctuate in any given period depending on factors such as the type and condition of the property, the term of the lease, the type of the lease, the involvement of external leasing agents and overall market conditions. Capital expenditures may fluctuate in any given period subject to the nature, extent and timing of improvements required to maintain our properties. While the COVID-19 pandemic and restrictions intended to prevent its spread remain in effect, there may be a continued lower level of leasing activity when compared to levels prior to the COVID-19 pandemic.

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For properties within our stabilized portfolio, excluding our development properties, we believe we could spend approximately $75 million to $85 million in capital improvements, tenant improvements and leasing costs in 2021, in addition to the lease and contractual commitments included in our contractual obligations table above. The amount we ultimately spend will depend on leasing activity during 2021.

The following table sets forth our historical actual capital expenditures, and tenant improvements and leasing costs for deals commenced, excluding tenant-funded tenant improvements, for renewed and re-tenanted space within our stabilized portfolio for each of the years ended December 31, 2020, 2019 and 2018 on a per square foot basis.

	Year Ended December 31,
	2020		2019		2018
Office Properties:(1)
Capital Expenditures:
Capital expenditures per square foot	$	2.31	$	1.26	$	2.00
Tenant Improvement and Leasing Costs (2)
Replacement tenant square feet (3)	375,345		1,228,973		717,427
Tenant improvements per square foot commenced	$	69.26	$	47.79	$	41.87
Leasing commissions per square foot commenced	$	18.88	$	18.89	$	14.77
Total per square foot	$	88.14	$	66.68	$	56.64
Renewal tenant square feet	484,771		797,537		1,161,596
Tenant improvements per square foot commenced	$	17.35	$	13.72	$	26.64
Leasing commissions per square foot commenced	$	10.10	$	11.84	$	14.55
Total per square foot	$	27.45	$	25.56	$	41.19
Total per square foot per year	$	9.52	$	6.45	$	7.24
Average remaining lease term (in years)	5.7		7.8		6.5

_____________________

(1)Excludes development properties and includes 100% of consolidated property partnerships.

(2)Includes tenants with lease terms of 12 months or longer. Excludes leases for month-to-month and first generation tenants.

(3)Excludes leases for which the space was vacant for longer than one year, or vacant when the property was acquired by the Company.

Capital expenditures per square foot increased in 2020 as compared to 2019 due to an increase in general building improvements during 2020. We currently anticipate capital expenditures for 2021 to be consistent with 2020 levels. Replacement tenant improvements and leasing commissions increased in 2020 as compared to 2019 primarily due to large leases commenced in the San Francisco Bay Area and San Diego County regions in 2020 and overall reduced replacement tenant square feet in 2020. Renewal tenant improvements and leasing commissions per square foot increased in 2020 as compared to 2019 primarily due to a large lease renewed in the San Francisco Bay Area in 2020 and overall reduced renewal tenant square feet in 2020. We currently anticipate tenant improvement and leasing commissions for 2021 to be higher than 2020 levels due to an expected increase in leasing activity as well as the leases executed in prior years, including early renewals of lease expirations; however, ultimate costs incurred will depend upon market conditions in each of our submarkets and actual leasing activity.

Distribution Requirements

For a discussion of our dividend and distribution requirements, see “Liquidity and Capital Resources of the Company —Distribution Requirements.”

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Factors That May Influence Future Sources of Capital and Liquidity of the Company and the Operating Partnership

We continue to evaluate sources of financing for our business activities, including borrowings under the unsecured revolving credit facility, issuance of public and private equity securities, unsecured debt and fixed-rate secured mortgage financing, proceeds from the disposition of selective assets through our capital recycling program, and the formation of strategic ventures. However, our ability to obtain new financing or refinance existing borrowings on favorable terms could be impacted by various factors, including the state of the macro economy, the state of the credit and equity markets, significant tenant defaults, a decline in the demand for office properties, a decrease in market rental rates or market values of real estate assets in our submarkets, the amount of our future borrowings and the impact of the COVID-19 pandemic, and restrictions intended to prevents its spread, on capital and credit markets and our tenants (refer to “Part I, Item IA. Risk Factors” of this report for additional information). These events could result in the following:

•Decreases in our cash flows from operations, which could create further dependence on the unsecured revolving credit facility;

•An increase in the proportion of variable-rate debt, which could increase our sensitivity to interest rate fluctuations in the future; and

•A decrease in the value of our properties, which could have an adverse effect on the Operating Partnership’s ability to incur additional debt, refinance existing debt at competitive rates, or comply with its existing debt obligations.

In addition to the factors noted above, the Operating Partnership’s credit ratings are subject to ongoing evaluation by credit rating agencies and may be changed or withdrawn by a rating agency in the future if, in its judgment, circumstances warrant. In the event that the Operating Partnership’s credit ratings are downgraded, we may incur higher borrowing costs and may experience difficulty in obtaining additional financing or refinancing existing indebtedness.

Debt Covenants

The unsecured revolving credit facility, unsecured term loan facility, unsecured term loan, unsecured senior notes and certain other secured debt arrangements contain covenants and restrictions requiring us to meet certain financial ratios and reporting requirements. Key existing financial covenants and their covenant levels include:

Unsecured Credit and Private Placement Notes (as defined in the applicable Credit Agreements):	Covenant Level	Actual Performance as of December 31, 2020
Total debt to total asset value	less than 60%	30%
Fixed charge coverage ratio	greater than 1.5x	3.2x
Unsecured debt ratio	greater than 1.67x	3.09x
Unencumbered asset pool debt service coverage	greater than 1.75x	3.98x
Unsecured Senior Notes due 2023, 2024, 2025, 2028, 2029, 2030 and 2032 (as defined in the applicable Indentures):
Total debt to total asset value	less than 60%	35%
Interest coverage	greater than 1.5x	8.1x
Secured debt to total asset value	less than 40%	2%
Unencumbered asset pool value to unsecured debt	greater than 150%	297%

The Operating Partnership was in compliance with all of its debt covenants as of December 31, 2020. Our current expectation is that the Operating Partnership will continue to meet the requirements of its debt covenants in both the short and long term. In response to the COVID-19 pandemic, we have completed stress testing of our various financial covenants assuming decreases in rental income and determined that the Operating Partnership has adequate cushion between actual performance and debt covenant levels. However, in the event of an economic

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slowdown or continued volatility in the credit markets, there is no certainty that the Operating Partnership will be able to continue to satisfy all the covenant requirements.

Consolidated Historical Cash Flow Summary

The following summary discussion of our consolidated historical cash flow is based on the consolidated statements of cash flows in Item 15. “Exhibits and Financial Statement Schedules” and is not meant to be an all-inclusive discussion of the changes in our cash flow for the periods presented below. Changes in our cash flow include changes in cash and cash equivalents and restricted cash. Our historical cash flow activity for the year ended December 31, 2020 as compared to the year ended December 31, 2019 is as follows:

	Year Ended December 31,
	2020		2019		Dollar Change		Percentage Change
	($ in thousands)
Net cash provided by operating activities	$	455,590	$	386,521	$	69,069	17.9	%
Net cash used in investing activities	(542,128)		(1,228,279)		686,151		(55.9)	%
Net cash provided by financing activities	833,324		747,068		86,256		11.5	%
Net increase (decrease) in cash and cash equivalents	$	746,786	$	(94,690)	$	841,476	888.7	%

Operating Activities

Our cash flows from operating activities depends on numerous factors including the occupancy level of our portfolio, the rental rates achieved on our leases, the collectability of rent and recoveries from our tenants, the level of operating expenses, the impact of property acquisitions, completed development projects and related financing activities, and other general and administrative costs. Our net cash provided by operating activities increased by $69.1 million, or 17.9%, for the year ended December 31, 2020 compared to the year ended December 31, 2019 primarily as a result of net changes in other assets related to the timing of expenditures and net cash flow from operations of development properties that became stabilized during the year ended December 31, 2020.

Investing Activities

Our cash flows from investing activities is generally used to fund development and operating property acquisitions, expenditures for development projects, and recurring and nonrecurring capital expenditures for our operating properties, net of proceeds received from dispositions of real estate assets. Our net cash used in investing activities decreased by $686.2 million, or 55.9%, for the year ended December 31, 2020 compared to the year ended December 31, 2019, primarily due to lower expenditures for development properties and undeveloped land, no acquisitions completed and lower disposition activity during the year ended December 31, 2020.

Financing Activities

Our cash flows from financing activities is principally impacted by our capital raising activities, net of dividends and distributions paid to common and preferred security holders. Our net cash provided by financing activities increased by $86.3 million or 11.5% for the year ended December 31, 2020 compared to the year ended December 31, 2019, primarily due to the net proceeds received upon physical settlement of our February 2020 forward equity sale agreements pursuant to which we issued 5,750,000 shares of common stock and the forward equity sale agreements entered into during the year ended December 31, 2019 under our at-the-market program pursuant to which we issued 3,147,110 shares of common stock during the year ended December 31, 2020 partially offset by net repayments on our unsecured revolving credit facility during the year ended December 31, 2020 compared to net borrowings during the year ended December 31, 2019.

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Off-Balance Sheet Arrangements

As of December 31, 2020 and as of the date this report was filed, we did not have any off-balance sheet transactions, arrangements, or obligations, including contingent obligations.

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Non-GAAP Supplemental Financial Measure: Funds From Operations

We calculate FFO in accordance with the 2018 Restated White Paper on FFO approved by the Board of Governors of NAREIT. The White Paper defines FFO as net income or loss calculated in accordance with GAAP, excluding extraordinary items, as defined by GAAP, gains and losses from sales of depreciable real estate and impairment write-downs associated with depreciable real estate, 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. Our calculation of FFO includes the amortization of deferred revenue related to tenant-funded tenant improvements and excludes the depreciation of the related tenant improvement assets. We also add back net income attributable to noncontrolling common units of the Operating Partnership because we report FFO attributable to common stockholders and common unitholders.

We believe that FFO is a useful supplemental measure of our operating performance. The exclusion from FFO of gains and losses from the sale of operating real estate assets allows investors and analysts to readily identify the operating results of the assets that form the core of our activity and assists in comparing those operating results between periods. Also, because FFO is generally recognized as the industry standard for reporting the operations of REITs, it facilitates comparisons of operating performance to other REITs. However, other REITs may use different methodologies to calculate FFO, and accordingly, our FFO may not be comparable to all other REITs.

Implicit in historical cost accounting for real estate assets in accordance with GAAP is the assumption that the value of real estate assets diminishes predictably over time. Since real estate values have historically risen or fallen with market conditions, many industry investors and analysts have considered presentations of operating results for real estate companies using historical cost accounting alone to be insufficient. Because FFO excludes depreciation and amortization of real estate assets, we believe that FFO along with the required GAAP presentations provides a more complete measurement of our performance relative to our competitors and a more appropriate basis on which to make decisions involving operating, financing and investing activities than the required GAAP presentations alone would provide.

However, FFO should not be viewed as an alternative measure of our operating performance because 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 our properties, which are significant economic costs and could materially impact our results from operations.

The following table presents our FFO for the years ended December 31, 2020, 2019, 2018, 2017 and 2016:

	Year ended December 31,
	2020		2019		2018		2017		2016
	(in thousands)
Net income available to common stockholders	$	187,105	$	195,443	$	258,415	$	151,249	$	280,538
Adjustments:
Net income attributable to noncontrolling common units of the Operating Partnership	2,869		3,766		5,193		3,223		6,635
Net income attributable to noncontrolling interests in consolidated property partnerships	17,319		16,020		14,318		12,780		3,375
Depreciation and amortization of real estate assets	290,353		268,045		249,882		241,862		213,156
Gains on sales of depreciable real estate	(35,536)		(36,802)		(142,926)		(39,507)		(164,302)
Funds From Operations attributable to noncontrolling interests in consolidated property partnerships	(28,754)		(27,994)		(24,391)		(22,820)		(5,660)
Funds From Operations (1) (2)	$	433,356	$	418,478	$	360,491	$	346,787	$	333,742

____________________

(1)Reported amounts are attributable to common stockholders, common unitholders and restricted stock unitholders.

(2)FFO available to common stockholders and unitholders includes amortization of deferred revenue related to tenant-funded tenant improvements of $22.5 million, $19.2 million, $18.4 million, $16.8 million and $13.2 million for the years ended December 31, 2020, 2019, 2018, 2017 and 2016, respectively.

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The following table presents our weighted average shares of common stock and common units outstanding for the years ended December 31, 2020, 2019, 2018, 2017 and 2016:

	Year Ended December 31,
	2020	2019	2018	2017	2016
Weighted average shares of common stock outstanding	113,241,341	103,200,568	99,972,359	98,113,561	92,342,483
Weighted average common units outstanding	1,854,165	2,023,407	2,052,917	2,133,006	2,429,205
Effect of participating securities – nonvested shares and restricted stock units	1,137,265	1,118,349	1,142,053	1,196,044	1,139,669
Total basic weighted average shares / units outstanding	116,232,771	106,342,324	103,167,329	101,442,611	95,911,357
Effect of dilutive securities – shares issuable under executed forward equity sale agreements, stock options and contingently issuable shares	478,281	648,600	510,006	613,770	680,551
Total diluted weighted average shares / units outstanding	116,711,052	106,990,924	103,677,335	102,056,381	96,591,908

Inflation

The majority of the Company’s leases require tenants to pay for recoveries and escalation charges based upon the tenant’s proportionate share of, and/or increases in, real estate taxes and certain operating costs, which reduce the Company’s exposure to increases in operating costs resulting from inflation.

New Accounting Pronouncements and Auditing Standards

For a discussion of new accounting pronouncements see Note 2 “Basis of Presentation and Significant Accounting Policies” to our consolidated financial statements included in this report.

On June 1, 2017, the Public Company Accounting Oversight Board (PCAOB) issued Auditing Standard 3101, The Auditor’s Report on an Audit of Financial Statements When the Auditor Expresses an Unqualified Opinion (“AS 3101”). As a result of AS 3101, the most significant change to the auditor’s report on the financial statements is a new requirement to describe critical audit matters arising from the audit of the current period’s financial statements in the auditor’s report. The requirements related to critical audit matters in AS 3101 were effective for audits of fiscal years ending on or after June 30, 2019, for large accelerated filers; and for fiscal years ending on or after December 15, 2020, for all other companies to which the requirements apply. Therefore, critical audit matters are included in the Report of Independent Registered Public Accounting Firm for the Company’s and the Operating Partnership’s consolidated financial statements as of and for the years ended December 31, 2020.

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ITEM 7A.     QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The primary market risk we face is interest rate risk. We seek to mitigate this risk by following established risk management policies and procedures. These policies include maintaining prudent amounts of debt, including a greater amount of fixed-rate debt as compared to variable-rate debt in our portfolio, and may include the periodic use of derivative instruments. As of December 31, 2020 and 2019, we did not have any interest-rate sensitive derivative assets or liabilities. Information about our changes in interest rate risk exposures from December 31, 2019 to December 31, 2020 is incorporated herein by reference from “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations —Liquidity and Capital Resources of the Operating Partnership.”

Interest Rate Risk

As of December 31, 2020, 100.0% of our total outstanding debt of $4.0 billion (before the effects of debt discounts and deferred financing costs) bore interest at fixed rates since our only variable-rate debt instrument was our unsecured revolving credit facility which had no outstanding balance at December 31, 2020. All of our interest rate sensitive financial instruments are held for purposes other than trading purposes. In general, interest rate fluctuations applied to our variable-rate debt will impact our future earnings and cash flows. Conversely, interest rate fluctuations applied to our fixed-rate debt will generally not impact our future earnings and cash flows, unless such instruments mature or are otherwise terminated and need to be refinanced. However, interest rate fluctuations will impact the fair value of the fixed-rate debt instruments.

We generally determine the fair value of our secured debt, unsecured debt, and unsecured revolving credit facility by performing discounted cash flow analyses using an appropriate market discount rate. We calculate the market rate by obtaining period-end treasury rates for maturities that correspond to the maturities of our fixed-rate debt and then adding an appropriate credit spread based on information obtained from third-party financial institutions. These credit spreads take into account factors, including but not limited to, our credit profile, the tenure of the debt, amortization period, whether the debt is secured or unsecured, and the loan-to-value ratio of the debt to the collateral, amongst other factors. These calculations are significantly affected by the assumptions used, including the discount rate, credit spreads and estimates of future cash flow. We calculate the market rate of our unsecured revolving credit facility by obtaining the period-end London Interbank Offered Rate (“LIBOR”) and then adding an appropriate credit spread based on our credit ratings, and the amended terms of our unsecured revolving credit facility agreement. We determine the fair value of each of our publicly traded unsecured senior notes based on their quoted trading price at the end of the reporting period, if such prices are available. See Note 19 “Fair Value Measurements and Disclosures” and Note 2 “Basis of Presentation and Significant Accounting Policies” in the consolidated financial statements included in this report for additional information on the fair value of our financial assets and liabilities as of December 31, 2020 and December 31, 2019.

At December 31, 2020, there was no outstanding balance on our $750.0 million unsecured revolving credit facility; however, it was available for borrowing at the following variable rate: LIBOR plus a spread of 1.00% (weighted average interest rate of 1.14%). As of December 31, 2019, the total outstanding balance of our variable-rate debt was comprised of borrowings on our unsecured revolving credit facility of $245.0 million and unsecured term loan facility of $150.0 million, which were indexed to LIBOR plus a spread of 1.00% (weighted average interest rate of 2.76%) and LIBOR plus a spread of 1.10% (weighted average interest rate of 2.85%), respectively.

The total carrying value of our fixed-rate debt was approximately $3.9 billion and $3.2 billion as of December 31, 2020 and 2019, respectively. The total estimated fair value of our fixed-rate debt was approximately $4.4 billion and $3.4 billion as of December 31, 2020 and 2019, respectively. For sensitivity purposes, a 100 basis point increase in the discount rate equates to a decrease in the total fair value of our fixed-rate debt of approximately $264.2 million, or 6.0%, as of December 31, 2020. Comparatively, a 100 basis point increase in the discount rate equates to a decrease in the total fair value of our fixed-rate debt of approximately $203.3 million, or 6.0%, as of December 31, 2019.

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The Financial Conduct Authority (the authority that regulates LIBOR) has announced it intends to stop compelling banks to submit rates for the calculation of LIBOR at some point in the future. The Alternative Reference Rates Committee (“ARRC”) has proposed that the Secured Overnight Financing Rate (“SOFR”) is the rate that represents best practice as the alternative to LIBOR for use in derivatives and other financial contracts that are currently indexed to LIBOR. ARRC has proposed a paced market transition plan to SOFR from LIBOR and organizations are currently working on industry wide and company specific transition plans as it relates to derivatives and cash markets exposed to LIBOR. As our variable-rate debt is indexed to LIBOR, we are monitoring this activity and evaluating the related risks.

ITEM 8.    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA    

See the index included at Item 15. “Exhibits and Financial Statement Schedules.”

ITEM 9.    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE    

Not applicable.

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ITEM 9A.    CONTROLS AND PROCEDURES    

Kilroy Realty Corporation

The Company maintains disclosure controls and procedures (as defined in Rule 13a-15(e) or Rule 15d-15(e) under the Exchange Act) that are designed to ensure that information required to be disclosed in the Company’s reports under the Exchange Act is processed, recorded, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

As required by SEC Rule 13a-15(b), the Company carried out an evaluation, under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the disclosure controls and procedures as of December 31, 2020, the end of the period covered by this report. Based on the foregoing, the Company’s Chief Executive Officer and Chief Financial Officer concluded, as of that time, the disclosure controls and procedures were effective at the reasonable assurance level.

Changes in Internal Control Over Financial Reporting

There have been no changes that occurred during the fourth quarter of the most recent year covered by this report in the Company’s internal control over financial reporting identified in connection with the evaluation referenced above that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Management’s Report on Internal Control Over Financial Reporting

Internal control over financial reporting is a process designed by, or under the supervision of, our Chief Executive Officer and Chief Financial Officer and effected by our board of directors, management, and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP. Internal control over financial reporting includes those policies and procedures that: (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that our receipts and expenditures are being made only in accordance with authorizations of management and directors; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of assets that could have a material effect on the consolidated financial statements.

Management is responsible for establishing and maintaining adequate internal control over financial reporting. Our internal control over financial reporting is supported by written policies and procedures and by an appropriate segregation of responsibilities and duties. The Company has used the criteria set forth in the Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission to assess our internal control over financial reporting. Based upon this assessment, management concluded that internal control over financial reporting operated effectively as of December 31, 2020.

Deloitte & Touche LLP, the Company’s independent registered public accounting firm, has audited the Company’s financial statements and has issued a report on the effectiveness of the Company’s internal control over financial reporting.

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders and Board of Directors of

Kilroy Realty Corporation

Opinion on Internal Control over Financial Reporting

We have audited the internal control over financial reporting of Kilroy Realty Corporation and subsidiaries (the “Company”) as of December 31, 2020, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control - Integrated Framework (2013) issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2020, of the Company and our report dated February 12, 2021, expressed an unqualified opinion on those financial statements.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ DELOITTE & TOUCHE LLP

Los Angeles, California

February 12, 2021

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Kilroy Realty, L.P.

The Operating Partnership maintains disclosure controls and procedures (as defined in Rule 13a-15(e) or Rule 15d-15(e) under the Exchange Act) that are designed to ensure that information required to be disclosed in the Operating Partnership’s reports under the Exchange Act, is processed, recorded, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer of its general partner, as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

As required by SEC Rule 13a-15(b), the Operating Partnership carried out an evaluation, under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer of its general partner, of the effectiveness of the design and operation of the disclosure controls and procedures as of December 31, 2020, the end of the period covered by this report. Based on the foregoing, the Chief Executive Officer and Chief Financial Officer of its general partner concluded, as of that time, the disclosure controls and procedures were effective at the reasonable assurance level.

Changes in Internal Control Over Financial Reporting

There have been no changes that occurred during the fourth quarter of the most recent year covered by this report in the Operating Partnership’s internal control over financial reporting identified in connection with the evaluation referenced above that have materially affected, or are reasonably likely to materially affect, the Operating Partnership’s internal control over financial reporting.

Management’s Report on Internal Control Over Financial Reporting

Internal control over financial reporting is a process designed by, or under the supervision of, the Chief Executive Officer and Chief Financial Officer of the Operating Partnership’s general partner and effected by the board of directors, management, and other personnel of its general partner to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP. Internal control over financial reporting includes those policies and procedures that: (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that our receipts and expenditures are being made only in accordance with authorizations of management and directors; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of assets that could have a material effect on the consolidated financial statements.

Management is responsible for establishing and maintaining adequate internal control over financial reporting. Our internal control over financial reporting is supported by written policies and procedures and by an appropriate segregation of responsibilities and duties. The Operating Partnership has used the criteria set forth in the Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission to assess our internal control over financial reporting. Based upon this assessment, management concluded that internal control over financial reporting operated effectively as of December 31, 2020.

Deloitte & Touche LLP, the Operating Partnership’s independent registered public accounting firm, has audited the Operating Partnership’s financial statements and has issued a report on the effectiveness of the Operating Partnership’s internal control over financial reporting.

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Partners of

Kilroy Realty, L.P.

Opinion on Internal Control over Financial Reporting

We have audited the internal control over financial reporting of Kilroy Realty, L.P. and subsidiaries (the “Operating Partnership”) as of December 31, 2020, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Operating Partnership maintained, in all material respects, effective internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control - Integrated Framework (2013) issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2020, of the Operating Partnership and our report dated February 12, 2021, expressed an unqualified opinion on those financial statements.

Basis for Opinion

The Operating Partnership’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Operating Partnership’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Operating Partnership in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ DELOITTE & TOUCHE LLP

Los Angeles, California

February 12, 2021

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ITEM 9B.    OTHER INFORMATION

Not applicable.

PART III

ITEM 10.    DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The information required by Item 10 is incorporated by reference from our definitive proxy statement for our annual stockholders’ meeting presently scheduled to be held in May 2021.

ITEM 11.    EXECUTIVE COMPENSATION

The information required by Item 11 is incorporated by reference from our definitive proxy statement for our annual stockholders’ meeting presently scheduled to be held in May 2021.

ITEM 12.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The information required by Item 12 is incorporated by reference from our definitive proxy statement for our annual stockholders’ meeting presently scheduled to be held in May 2021.

ITEM 13.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

The information required by Item 13 is incorporated by reference from our definitive proxy statement for our annual stockholders’ meeting presently scheduled to be held in May 2021.

ITEM 14.     PRINCIPAL ACCOUNTANT FEES AND SERVICES

The information required by Item 14 is incorporated by reference from our definitive proxy statement for our annual stockholders’ meeting presently scheduled to be held in May 2021.

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PART IV

ITEM 15.    EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a)(1) and (2) Financial Statements and Schedules

The following consolidated financial information is included as a separate section of this annual report on Form 10-K:

Report of Independent Registered Public Accounting Firm – Kilroy Realty Corporation	F - 2
Consolidated Balance Sheets as of December 31, 2020 and 2019 – Kilroy Realty Corporation	F - 4
Consolidated Statements of Operations for the Years ended December 31, 2020, 2019 and 2018 – Kilroy Realty Corporation	F - 5
Consolidated Statements of Equity for the Years ended December 31, 2020, 2019 and 2018 – Kilroy Realty Corporation	F - 6
Consolidated Statements of Cash Flows for the Years ended December 31, 2020, 2019 and 2018 – Kilroy Realty Corporation	F - 7
Report of Independent Registered Public Accounting Firm – Kilroy Realty, L.P.	F - 8
Consolidated Balance Sheets as of December 31, 2020 and 2019 – Kilroy Realty, L.P.	F - 10
Consolidated Statements of Operations for the Years ended December 31, 2020, 2019 and 2018 – Kilroy Realty, L.P.	F - 11
Consolidated Statements of Capital for the Years ended December 31, 2020, 2019 and 2018 – Kilroy Realty, L.P.	F - 12
Consolidated Statements of Cash Flows for the Years ended December 31, 2020, 2019 and 2018 – Kilroy Realty, L.P.	F - 13
Notes to Consolidated Financial Statements	F - 14
Schedule II – Valuation and Qualifying Accounts	F - 65
Schedule III – Real Estate and Accumulated Depreciation	F - 66

All other schedules are omitted because the required information is not present in amounts sufficient to require submission of the schedule or because the information required is included in the financial statements and notes thereto.

(3)  Exhibits

Exhibit Number	Description
3.(i)1	Articles of Amendment and Restatement of Kilroy Realty Corporation (previously filed by Kilroy Realty Corporation as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on May 21, 2020)
3.(i)2	Certificate of Limited Partnership of Kilroy Realty, L.P. (previously filed by Kilroy Realty, L.P., as an exhibit to the General Form for Registration of Securities on Form 10 as filed with the Securities and Exchange Commission on August 18, 2010)
3.(i)3	Amendment to the Certificate of Limited Partnership of Kilroy Realty, L.P. (previously filed by Kilroy Realty, L.P., as an exhibit to the General Form for Registration of Securities on Form 10 as filed with the Securities and Exchange Commission on August 18, 2010)
3.(i)4	Articles Supplementary reclassifying shares of the Series G Preferred Stock of the Company (previously filed by Kilroy Realty Corporation as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on August 23, 2017)
3.(i)5	Articles Supplementary reclassifying shares of the Series H Preferred Stock of the Company (previously filed by Kilroy Realty Corporation as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on August 23, 2017)

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3.(ii)1	Sixth Amended and Restated Bylaws of Kilroy Realty Corporation (previously filed by Kilroy Realty Corporation as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on December 30, 2020)
3.(ii)2	Seventh Amended and Restated Agreement of Limited Partnership of Kilroy Realty, L.P. dated August 15, 2012, as amended (previously filed by Kilroy Realty Corporation on Form 10-Q for the quarter ended June 30, 2014)
4.(vi)1*	Description of Capital Stock of Kilroy Realty Corporation
4.(vi)2	Description of Common Units Representing Limited Partnership Interests of Kilroy Realty, L.P.
4.1	Kilroy Realty Corporation Form of Certificate for Common Stock (previously filed by Kilroy Realty Corporation as an exhibit to the Registration Statement on Amendment No. 3 to Form S-11 (No. 333-15553))
4.2	Registration Rights Agreement, dated January 31, 1997 (previously filed by Kilroy Realty Corporation as an exhibit to the Registration Statement on Amendment No. 3 to Form S-11 (No. 333-15553))
4.3	Form of Certificate for Partnership Units of Kilroy Realty, L.P. (previously filed by Kilroy Realty, L.P., as an exhibit to the General Form for Registration of Securities on Form 10 as filed with the Securities and Exchange Commission on August 18, 2010)
4.4	Registration Rights Agreement, dated July 31, 2012 (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended June 30, 2012)
4.5	Officers’ Certificate pursuant to Sections 101, 201, 301 and 303 of the Indenture dated March 1, 2011, among Kilroy Realty, L.P., as issuer, Kilroy Realty Corporation, as guarantor, and U.S. Bank National Association, as trustee, establishing a series of securities entitled “3.800% Notes due 2023,” including the form of 3.800% Notes due 2023 and the form of related guarantee (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P. as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on January 14, 2013)
4.6	Indenture, dated March 1, 2011, by and among Kilroy Realty, L.P., as issuer, Kilroy Realty Corporation, as guarantor, and U.S. Bank National Association, as trustee (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P. as an exhibit to the Registration Statement on Form S-3 as filed with the Securities and Exchange Commission on October 2, 2013)
4.7	Supplemental Indenture, dated July 5, 2011, among Kilroy Realty, L.P., as issuer, Kilroy Realty Corporation, as guarantor, and U.S. Bank National Association, as trustee (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P. as an exhibit to the Registration Statement on Form S-3 as filed with the Securities and Exchange Commission on October 2, 2013)
4.8	Officers’ Certificate pursuant to Sections 102, 201, 301 and 303 of the Indenture dated March 1, 2011, among Kilroy Realty, L.P., as issuer, Kilroy Realty Corporation, as guarantor, and U.S. Bank National Association, as trustee, establishing a series of securities entitled “4.25% Senior Notes due 2029,” including the form of 4.25% Senior Notes due 2029 and the form of related guarantee (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P. as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on August 6, 2014)
4.9	Officers’ Certificate, dated September 16, 2015, pursuant to Sections 102, 201, 301 and 303 of the Indenture dated March 1, 2011, among Kilroy Realty, L.P., as issuer, Kilroy Realty Corporation, as guarantor, and U.S. Bank National Association, as trustee, establishing a series of securities entitled “4.375% Senior Notes due 2025,” including the form of 4.375% Senior Notes due 2025 and the form of related guarantee (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P. as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on September 16, 2015)
4.10	Officers’ Certificate, dated December 11, 2017, pursuant to Sections 102, 201, 301 and 303 of the Indenture dated March 1, 2011, among Kilroy Realty, L.P., as issuer, Kilroy Realty Corporation, as guarantor, and U.S. Bank National Association, as trustee, establishing a series of securities entitled “3.450% Senior Notes due 2024,” including the form of 3.450% Senior Notes due 2024 and the form of related guarantee (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P. as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on December 11, 2017)

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4.11	Officers’ Certificate, dated November 29, 2018, pursuant to Sections 102, 201, 301 and 303 of the Indenture dated March 1, 2011, as amended and supplemented, among Kilroy Realty, L.P., as issuer, Kilroy Realty Corporation, as guarantor, and U.S. Bank National Association, as trustee, establishing a series of securities entitled “4.750% Senior Notes due 2028,” including the form of 4.750% Senior Note due 2028 and the form of related guarantee (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on November 29, 2018)
4.12	Officers’ Certificate, dated September 17, 2019, pursuant to Sections 102, 201, 301 and 303 of the Indenture dated March 1, 2011, as amended and supplemented, among Kilroy Realty, L.P., as issuer, Kilroy Realty Corporation, as guarantor, and U.S. Bank National Association, as trustee, establishing a series of securities entitled “3.050% Senior Notes due 2030,” including the form of 3.050% Senior Note due 2030 and the form of related guarantee (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P. as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on September 17, 2019)
4.13	Officers’ Certificate, dated August 12, 2020, pursuant to Sections 102, 201, 301 and 303 of the Indenture dated March 1, 2011, as amended and supplemented, among Kilroy Realty, L.P., as issuer, Kilroy Realty Corporation, as guarantor, and U.S. Bank National Association, as trustee, establishing a series of securities entitled “2.500% Senior Notes due 2032,” including the form of 2.500% Senior Note due 2032 and the form of related guarantee (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on August 18, 2020)
4.14	The Company is party to agreements in connection with long-term debt obligations, none of which individually exceeds ten percent of the total assets of the Company on a consolidated basis. Pursuant to Item 601(b)(4)(iii)(A) of Regulation S-K, the Company agrees to furnish copies of these agreements to the Commission upon request
10.1	Pledge Agreement by and among Kilroy Realty, L.P., John B. Kilroy, Sr., John B. Kilroy, Jr. and Kilroy Industries (previously filed by Kilroy Realty Corporation as an exhibit to the Registration Statement on Amendment No. 3 to Form S-11 (No. 333-15553))
10.2†	1997 Stock Option and Incentive Plan of the Registrant and Kilroy Realty, L.P. (previously filed by Kilroy Realty Corporation as an exhibit to the Registration Statement on Amendment No. 3 to Form S-11 (No. 333-15553))
10.3	License Agreement by and among the Registrant and the other persons named therein (previously filed by Kilroy Realty Corporation as an exhibit to the Registration Statement on Amendment No. 4 to Form S-11 (No. 333-15553))
10.4†	Form of Restricted Stock Award Agreement (previously filed by Kilroy Realty Corporation as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on February 8, 2007)
10.5†	Kilroy Realty Corporation Stock Award Deferral Program (previously filed by Kilroy Realty Corporation as an exhibit to Form 8-K as filed with the Securities and Exchange Commission on January 2, 2008)
10.6†	Form of Indemnification Agreement of Kilroy Realty Corporation with certain officers and directors (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-K for the year ended December 31, 2009)
10.7†	Kilroy Realty Corporation Form of Stock Option Grant Notice and Stock Option Agreement (previously filed by Kilroy Realty Corporation as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on February 24, 2012)
10.8†	Form of Restricted Stock Unit Agreement (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended June 30, 2013)
10.9†	Form of Stock Award Deferral Program Restricted Stock Unit Agreement (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended June 30, 2013)
10.10†	Form of Performance-Vest Restricted Stock Unit Agreement (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended March 31, 2014)
10.11†	Form of Restricted Stock Unit Agreement (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended March 31, 2014)
10.12†	Form of Restricted Stock Unit Agreement for Non-Employee Members of the Board of Directors (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended March 31, 2014)

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10.13†	Form of Performance-Vest Restricted Stock Unit Agreement (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended March 31, 2015)
10.14†	Form of Restricted Stock Unit Agreement (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended March 31, 2015)
10.15†	Form of Restricted Stock Unit Agreement for Non-Employee Members of the Board of Directors (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended March 31, 2015)
10.16†	Separation Agreement by and between Kilroy Realty Corporation, Kilroy Realty, L.P. and Jeffrey C. Hawken dated as of July 2, 2020 (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended June 30, 2020)
10.17†	Amended and Restated Employment Agreement and Non-Competition Agreement by and between Kilroy Realty Corporation, Kilroy Realty, L.P. and Tyler H. Rose effective as of January 28, 2016 (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended March 31, 2016)
10.18†	Amended and Restated Employment Agreement and Non-Competition Agreement by and between Kilroy Realty Corporation, Kilroy Realty, L.P. and Justin W. Smart effective as of January 28, 2016 (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended March 31, 2016)
10.19†	Kilroy Realty Corporation Director Compensation Policy effective as of April 1, 2018 (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended March 31, 2018.
10.20†	Employment Agreement, as amended and restated December 27, 2018, by and between Kilroy Realty Corporation, Kilroy Realty, L.P. and John B. Kilroy, Jr. (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on December 31, 2018)
10.21†	Kilroy Realty Corporation 2006 Incentive Award Plan Restricted Stock Unit Agreement by and between Kilroy Realty Corporation and John B. Kilroy, Jr., dated December 27, 2018 (with retirement as to Time-Based RSUs) (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on December 31, 2018)
10.22†	Kilroy Realty Corporation 2006 Incentive Award Plan Restricted Stock Unit Agreement by and between Kilroy Realty Corporation and John B. Kilroy, Jr., dated December 27, 2018 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on December 31, 2018)
10.23†	Form of Restricted Stock Unit Agreement for 2006 Incentive Award Plan
10.24	Note Purchase Agreement dated September 14, 2016 (previously filed by Kilroy Realty Corporation as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on September 14, 2016)
10.25	Amendment to Note Purchase Agreement dated May 11, 2018 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on May 14, 2018)
10.26	Form of Time Sharing Agreement of Kilroy Realty, L.P. (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended September 30, 2016)
10.27	Promissory Note, dated November 29, 2016 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 10-K for the year ended December 31, 2017)
10.28	Loan Agreement, dated November 29, 2016, by and between KR WMC, LLC and Massachusetts Mutual Life Insurance Company (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 10-K for the year ended December 31, 2017)
10.29	Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing, dated November 29, 2016 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 10-K for the year ended December 31, 2017)
10.30	Assignment of Leases and Rents, dated November 29, 2016 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 10-K for the year ended December 31, 2017)
10.31	Recourse Guaranty Agreement, dated November 29, 2016 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 10-K for the year ended December 31, 2017)

109

10.32	Environmental Indemnification Agreement, dated November 29, 2016 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 10-K for the year ended December 31, 2017)
10.33†	Kilroy Realty Corporation 2007 Deferred Compensation Plan, as amended and restated effective January 1, 2017 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 10-K for the year ended December 31, 2016)
10.34	General Partner Guaranty Agreement, dated February 17, 2017 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 10-Q for the quarter ended March 31, 2017)
10.35†	Kilroy Realty 2006 Incentive Award Plan (previously filed by Kilroy Realty Corporation as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on May 21, 2020)
10.36	Second Amended and Restated Credit Agreement dated as of July 24, 2017 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 10-Q for the quarter ended June 30, 2017)
10.37	Second Amended and Restated Guaranty dated as of July 24, 2017 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 10-Q for the quarter ended on June 30, 2017)
10.38	Note Purchase Agreement dated May 11, 2018 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on May 14, 2018)
10.39	Sales Agreement, dated June 5, 2018 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on June 5, 2018)
10.40	Forward Sale Agreement dated February 18, 2020 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on February 21, 2020)
10.41	Forward Sale Agreement dated February 18, 2020 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on February 21, 2020)
10.42	Forward Sale Agreement dated February 18, 2020 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on February 21, 2020)
10.43	Forward Sale Agreement dated February 18, 2020 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on February 21, 2020)
10.44	Note Purchase Agreement dated April 28, 2020 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on April 30, 2020)
10.45	General Partner Guaranty Agreement dated April 28, 2020 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on April 30, 2020)
21.1*	List of Subsidiaries of Kilroy Realty Corporation
21.2*	List of Subsidiaries of Kilroy Realty, L.P.
23.1*	Consent of Deloitte & Touche LLP for Kilroy Realty Corporation
23.2*	Consent of Deloitte & Touche LLP for Kilroy Realty, L.P.
24.1*	Power of Attorney (included on the signature page of this Form 10-K)
31.1*	Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer of Kilroy Realty Corporation
31.2*	Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer of Kilroy Realty Corporation
31.3*	Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer of Kilroy Realty, L.P.
31.4*	Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer of Kilroy Realty, L.P.
32.1*	Section 1350 Certification of Chief Executive Officer of Kilroy Realty Corporation
32.2*	Section 1350 Certification of Chief Financial Officer of Kilroy Realty Corporation
32.3*	Section 1350 Certification of Chief Executive Officer of Kilroy Realty, L.P.

110

32.4*	Section 1350 Certification of Chief Financial Officer of Kilroy Realty, L.P.
101.1*	The following Kilroy Realty Corporation and Kilroy Realty, L.P. financial information for the year ended December 31, 2020, formatted in inline XBRL (eXtensible Business Reporting Language): (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Income, (iii) Consolidated Statements of Changes in Equity, (iv) Consolidated Statements of Capital, (v) Consolidated Statements of Cash Flows and (vi) Notes to the Consolidated Financial Statements(1)
104*	Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101.1)

*	Filed herewith
†	Management contract or compensatory plan or arrangement.
(1)	Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933 or Section 18 of the Securities Exchange Act of 1934 and otherwise are not subject to liability under these sections.

ITEM 16.    FORM 10-K SUMMARY

None.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, Kilroy Realty Corporation has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized on February 12, 2021.

KILROY REALTY CORPORATION
By	/s/ Merryl E. Werber
	Merryl E. Werber Senior Vice President, Chief Accounting Officer and Controller

112

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that we, the undersigned directors and officers of Kilroy Realty Corporation, do hereby severally constitute and appoint John Kilroy, Tyler H. Rose, Michelle Ngo and Merryl E. Werber, and each of them, as our true and lawful attorneys-in-fact and agents, each with full powers of substitution, to do any and all acts and things in our name and behalf in our capacities as directors and officers and to execute any and all instruments for us and in our names in the capacities indicated below, which said attorneys-in-fact and agents, or any of them, may deem necessary or advisable to enable Kilroy Realty Corporation to comply with the Securities Exchange Act of 1934, as amended, and any rules, regulations and requirements of the Securities and Exchange Commission, in connection with this Annual Report on Form 10-K, including specifically, but without limitation, the power and authority to sign for us or any of us, in our names in the capacities indicated below, any and all amendments hereto; and we do each hereby ratify and confirm all that said attorneys-in-fact and agents or their substitutes, or any one of them, shall do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Name	Title	Date
/s/ John Kilroy	Chairman of the Board, Chief Executive Officer (Principal Executive Officer)	February 12, 2021
John Kilroy
/s/ Michelle Ngo	Senior Vice President, Chief Financial Officer and Treasurer (Principal Financial Officer)	February 12, 2021
Michelle Ngo
/s/ Merryl E. Werber	Senior Vice President, Chief Accounting Officer and Controller (Principal Accounting Officer)	February 12, 2021
Merryl E. Werber
/s/ Edward F. Brennan, PhD	Director	February 11, 2021
Edward F. Brennan, PhD
/s/ Jolie Hunt	Director	February 11, 2021
Jolie Hunt
/s/ Scott S. Ingraham	Director	February 11, 2021
Scott S. Ingraham
/s/ Louisa G. Ritter	Director	February 11, 2021
Louisa G. Ritter
/s/ Gary R. Stevenson	Director	February 11, 2021
Gary R. Stevenson
/s/ Peter B. Stoneberg	Director	February 11, 2021
Peter B. Stoneberg

113

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, Kilroy Realty, L.P. has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized on February 12, 2021.

KILROY REALTY, L.P.
By	/s/ Merryl E. Werber
	Merryl E. Werber Senior Vice President, Chief Accounting Officer and Controller

114

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that we, the undersigned directors and officers of Kilroy Realty Corporation, as sole general partner and on behalf of Kilroy Realty, L.P., do hereby severally constitute and appoint John Kilroy, Tyler H. Rose, Michelle Ngo and Merryl E. Werber, and each of them, as our true and lawful attorneys-in-fact and agents, each with full powers of substitution, to do any and all acts and things in our name and behalf in our capacities as directors and officers and to execute any and all instruments for us and in our names in the capacities indicated below, which said attorneys-in-fact and agents, or any of them, may deem necessary or advisable to enable Kilroy Realty Corporation, as sole general partner and on behalf of Kilroy Realty, L.P., to comply with the Securities Exchange Act of 1934, as amended, and any rules, regulations and requirements of the Securities and Exchange Commission, in connection with this Annual Report on Form 10-K, including specifically, but without limitation, the power and authority to sign for us or any of us, in our names in the capacities indicated below, any and all amendments hereto; and we do each hereby ratify and confirm all that said attorneys-in-fact and agents or their substitutes, or any one of them, shall do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Name	Title	Date
/s/ John Kilroy	Chairman of the Board, Chief Executive Officer (Principal Executive Officer)	February 12, 2021
John Kilroy
/s/ Michelle Ngo	Senior Vice President, Chief Financial Officer and Treasurer (Principal Financial Officer)	February 12, 2021
Michelle Ngo
/s/ Merryl E. Werber	Senior Vice President, Chief Accounting Officer and Controller (Principal Accounting Officer)	February 12, 2021
Merryl E. Werber
/s/ Edward F. Brennan, PhD	Director	February 11, 2021
Edward F. Brennan, PhD
/s/ Jolie Hunt	Director	February 11, 2021
Jolie Hunt
/s/ Scott S. Ingraham	Director	February 11, 2021
Scott S. Ingraham
/s/ Louisa G. Ritter	Director	February 11, 2021
Louisa G. Ritter
/s/ Gary R. Stevenson	Director	February 11, 2021
Gary R. Stevenson
/s/ Peter B. Stoneberg	Director	February 11, 2021
Peter B. Stoneberg

115

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2020 AND 2019

AND FOR THE THREE YEARS ENDED DECEMBER 31, 2020

TABLE OF CONTENTS

	Page
FINANCIAL STATEMENTS OF KILROY REALTY CORPORATION:
Report of Independent Registered Public Accounting Firm	F - 2
Consolidated Balance Sheets as of December 31, 2020 and 2019	F - 4
Consolidated Statements of Operations for the Years ended December 31, 2020, 2019 and 2018	F - 5
Consolidated Statements of Equity for the Years ended December 31, 2020, 2019 and 2018	F - 6
Consolidated Statements of Cash Flows for the Years ended December 31, 2020, 2019 and 2018	F - 7
FINANCIAL STATEMENTS OF KILROY REALTY, L.P.:
Report of Independent Registered Public Accounting Firm	F - 8
Consolidated Balance Sheets as of December 31, 2020 and 2019	F - 10
Consolidated Statements of Operations for the Years ended December 31, 2020, 2019 and 2018	F - 11
Consolidated Statements of Capital for the Years ended December 31, 2020, 2019 and 2018	F - 12
Consolidated Statements of Cash Flows for the Years ended December 31, 2020, 2019 and 2018	F - 13
Notes to Consolidated Financial Statements for Kilroy Realty Corporation and Kilroy Realty, L.P.	F - 14
Schedule II – Valuation and Qualifying Accounts for Kilroy Realty Corporation and Kilroy Realty, L.P.	F - 65
Schedule III – Real Estate and Accumulated Depreciation for Kilroy Realty Corporation and    Kilroy Realty, L.P.	F - 66

F - 1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders and Board of Directors of

Kilroy Realty Corporation

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Kilroy Realty Corporation and subsidiaries (the “Company”) as of December 31, 2020 and 2019, the related consolidated statements of operations, equity, and cash flows, for each of the three years in the period ended December 31, 2020, and the related notes and the schedules listed in the Index at Item 15 (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2020 and 2019, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2020, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 12, 2021 expressed an unqualified opinion on the Company’s internal control over financial reporting.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Rental income, deferred revenue and acquisition-related intangible liabilities - Timing of Development Property Revenue Recognition and Ownership of Tenant Improvements - Refer to Notes 2 and 10 to the financial statements

Critical Audit Matter Description

The timing of when the Company commences rental revenue recognition depends largely on the Company’s determination of who is the owner of the tenant improvements of the leased space for accounting purposes. When management concludes that the Company is the owner of the tenant improvements, the Company records the cost to construct the tenant improvements as capital assets, and commences rental revenue recognition when the tenant takes possession of or controls the finished space, which is generally when the improvements being recorded are substantially complete. When management concludes that the Company is not the owner and the tenant is the owner of certain tenant improvements for accounting purposes, the Company records their contribution towards those

F - 2

tenant-owned improvements as a lease incentive, which is amortized as a reduction to rental revenue on a straight-line basis over the term of the related lease. Rental revenue recognition begins when the tenant takes possession of or controls the physical use of the leased space. Control is typically transferred when the Company has completed all its obligations under the lease agreement in order for the leased space to be used by the tenant. The Company’s determination of whether its obligations have been met and control has been transferred to the tenant can be complex for large development properties.

Construction for large development properties can include certain tenant improvements that are landlord-owned and others that are tenant-owned improvements. In making the determination of ownership of the tenant improvements, management considers numerous factors and performs a detailed evaluation of each individual lease. No one factor is determinative in reaching a conclusion and the factors management evaluates include but are not limited to (i) whether the lease agreement requires landlord approval of how the tenant improvement allowance is spent prior to installation of the tenant improvements (ii) whether the lease agreement requires the tenant to provide evidence to the landlord supporting the cost and what the tenant improvement allowance was spent on prior to payment by the landlord for such tenant improvements (iii) whether the tenant improvements are unique to the tenant or reusable by other tenants (iv) whether the tenant is permitted to alter or remove the tenant improvements without the consent of the landlord and (v) whether the ownership of the tenant improvements remains with the landlord or remains with the tenant at the end of the lease term. Further, large development properties can deliver leased space in phases, resulting in various revenue commencement dates with judgment surrounding when the tenant improvements that are landlord-owned, for a particular phase, are substantially complete.

Given the nature of construction work on large development properties, auditing management's judgments regarding the determination of the owner of the tenant improvements, when control of the leased space transfers to the tenant and when to begin rental revenue recognition involves especially subjective judgment. Performing audit procedures to evaluate the reasonableness of management’s conclusion on ownership of the tenant improvements, specifically related to whether the tenant improvements are unique to the tenant or reusable by other tenants, as well as the appropriate date for when control of the leased space transfers to the tenant required a high degree of auditor judgment and an increased extent of effort.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to determining the ownership of tenant improvements and when control of the leased space transfers to the tenant for development properties, thus the timing of the commencement of rental revenue recognition, included the following, among others:

•We tested the effectiveness of controls over revenue recognition, including those over the ownership of tenant improvements and the determination of when the tenant took possession of or controlled the leased space.

•We evaluated the reasonableness of management’s conclusions regarding the Company’s ownership of tenant improvements by:

–Evaluating the Company’s and the tenant’s respective obligations as governed by the lease agreements for selected leases against criteria for establishing ownership.

–Testing documentation supporting the nature of tenant improvements.

–Performing on-site inspections of selected development properties, as needed, to evaluate the nature of tenant improvements, particularly the uniqueness of the improvements.

•We evaluated the reasonableness of management’s conclusions regarding the possession of or control of the completed leased space and corresponding commencement of rental revenue recognition for development properties by:

–Testing documentation from construction contractors, architects, and city building inspection sign offs on temporary certificates of occupancy.

–Performing on-site inspections of selected development properties near the planned rental revenue recognition commencement date, as needed, to observe the status of the site and tenant improvements to evaluate whether control of the leased space had been or was ready to be transferred to the tenant.

/s/ DELOITTE & TOUCHE LLP

Los Angeles, California

February 12, 2021

We have served as the Company’s auditor since 1995.

F - 3

KILROY REALTY CORPORATION

CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)

	December 31, 2020		December 31, 2019
ASSETS
REAL ESTATE ASSETS (Notes 2, 3 and 4):
Land and improvements	$	1,628,848	$	1,466,166
Buildings and improvements	6,783,092		5,866,477
Undeveloped land and construction in progress	1,778,106		2,296,130
Total real estate assets held for investment	10,190,046		9,628,773
Accumulated depreciation and amortization	(1,798,646)		(1,561,361)
Total real estate assets held for investment, net	8,391,400		8,067,412
CASH AND CASH EQUIVALENTS (Note 22)	731,991		60,044
RESTRICTED CASH (Notes 3, 4 and 22)	91,139		16,300
MARKETABLE SECURITIES (Notes 16 and 19)	27,481		27,098
CURRENT RECEIVABLES, NET (Notes 2 and 6)	12,007		26,489
DEFERRED RENT RECEIVABLES, NET (Notes 2 and 6)	386,658		337,937
DEFERRED LEASING COSTS AND ACQUISITION-RELATED INTANGIBLE ASSETS, NET (Notes 2, 3 and 5)	210,949		212,805
RIGHT OF USE GROUND LEASE ASSETS (Notes 2 and 18)	95,523		96,348
PREPAID EXPENSES AND OTHER ASSETS, NET (Note 7)	53,560		55,661
TOTAL ASSETS	$	10,000,708	$	8,900,094
LIABILITIES AND EQUITY
LIABILITIES:
Secured debt, net (Notes 8, 9 and 19)	$	253,582	$	258,593
Unsecured debt, net (Notes 8, 9 and 19)	3,670,099		3,049,185
Unsecured line of credit (Notes 8, 9 and 19)	—		245,000
Accounts payable, accrued expenses and other liabilities (Note 18)	445,100		418,848
Ground lease liabilities (Notes 2 and 18)	97,778		98,400
Accrued dividends and distributions (Notes 13 and 27)	59,431		53,219
Deferred revenue and acquisition-related intangible liabilities, net (Notes 2, 3, 5 and 10)	128,523		139,488
Rents received in advance and tenant security deposits	68,874		66,503
Total liabilities	4,723,387		4,329,236
COMMITMENTS AND CONTINGENCIES (Note 18)
EQUITY:
Stockholders’ Equity (Note 13):
Common stock, $.01 par value, 280,000,000 and 150,000,000 shares authorized, respectively, 116,035,827 and 106,016,287 shares issued and outstanding, respectively	1,160		1,060
Additional paid-in capital	5,131,916		4,350,917
Distributions in excess of earnings	(103,133)		(58,467)
Total stockholders’ equity	5,029,943		4,293,510
Noncontrolling Interests (Notes 2 and 11):
Common units of the Operating Partnership	49,875		81,917
Noncontrolling interests in consolidated property partnerships	197,503		195,431
Total noncontrolling interests	247,378		277,348
Total equity	5,277,321		4,570,858
TOTAL LIABILITIES AND EQUITY	$	10,000,708	$	8,900,094

See accompanying notes to consolidated financial statements.

F - 4

KILROY REALTY CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share data)

	Year Ended December 31,
	2020		2019		2018
REVENUES (Note 2):
Rental income	$	892,306	$	826,472	$	656,631
Tenant reimbursements	—		—		80,982
Other property income	6,091		10,982		9,685
Total revenues	898,397		837,454		747,298
EXPENSES:
Property expenses (Note 2)	155,118		160,037		133,787
Real estate taxes (Note 2)	92,218		78,097		70,820
Provision for bad debts (Note 2)	—		—		5,685
Ground leases (Notes 2, 5 and 18)	8,891		8,113		6,176
General and administrative expenses (Notes 15 and 19)	99,264		88,139		90,471
Leasing costs (Notes 2 and 5)	4,493		7,615		—
Depreciation and amortization (Notes 2 and 5)	299,308		273,130		254,281
Total expenses	659,292		615,131		561,220
OTHER (EXPENSES) INCOME:
Interest income and other net investment gain (loss) (Note 19)	3,424		4,641		(559)
Interest expense (Note 9)	(70,772)		(48,537)		(49,721)
Gains on sales of depreciable operating properties (Note 4)	35,536		36,802		142,926
Loss on early extinguishment of debt (Note 9)	—		—		(12,623)
Net gain on sales of land (Note 4)	—		—		11,825
Total other (expenses) income	(31,812)		(7,094)		91,848
NET INCOME	207,293		215,229		277,926
Net income attributable to noncontrolling common units of the Operating Partnership (Notes 2 and 11)	(2,869)		(3,766)		(5,193)
Net income attributable to noncontrolling interests in consolidated property partnerships (Notes 2 and 11)	(17,319)		(16,020)		(14,318)
Total income attributable to noncontrolling interests	(20,188)		(19,786)		(19,511)
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS	$	187,105	$	195,443	$	258,415
Net income available to common stockholders per share – basic (Note 20)	$	1.63	$	1.87	$	2.56
Net income available to common stockholders per share – diluted (Note 20)	$	1.63	$	1.86	$	2.55
Weighted average shares of common stock outstanding – basic (Note 20)	113,241,341		103,200,568		99,972,359
Weighted average shares of common stock outstanding – diluted (Note 20)	113,719,622		103,849,168		100,482,365

See accompanying notes to consolidated financial statements.

F - 5

KILROY REALTY CORPORATION

CONSOLIDATED STATEMENTS OF EQUITY

(in thousands, except share and per share/unit data)

	Common Stock							Total Stock- holders’ Equity		Noncontrolling  Interests		Total Equity
	Number  of Shares	Common Stock		Additional Paid-in Capital		Distributions in Excess of Earnings
BALANCE AS OF DECEMBER 31, 2017	98,620,333	$	986	$	3,822,492	$	(122,685)	$	3,700,793	$	259,523	$	3,960,316
Net income						258,415		258,415		19,511		277,926
Issuance of common stock	1,817,195	18		130,675				130,693				130,693
Issuance of share-based compensation awards				3,926				3,926				3,926
Non-cash amortization of share-based compensation				35,890				35,890				35,890
Exercise of stock options	1,000	—		41				41				41
Settlement of restricted stock units for shares of common stock	488,354	4		(4)				—				—
Repurchase of common stock, stock options and restricted stock units	(231,800)	(2)		(16,551)				(16,553)				(16,553)
Exchange of common units of the Operating Partnership	51,906	1		1,961				1,962		(1,962)		—
Contributions from noncontrolling interests in consolidated property partnerships								—		8,273		8,273
Distributions to noncontrolling interests in consolidated property partnerships								—		(11,803)		(11,803)
Adjustment for noncontrolling interest in the Operating Partnership				(1,477)				(1,477)		1,477		—
Dividends declared per share of common stock and common unit $1.79 per share/unit)						(183,783)		(183,783)		(3,665)		(187,448)
BALANCE AS OF DECEMBER 31, 2018	100,746,988	1,007		3,976,953		(48,053)		3,929,907		271,354		4,201,261
Net income						195,443		195,443		19,786		215,229
Opening adjustment to Distributions in Excess of Earnings upon adoption of ASC 842 (Note 2)						(3,146)		(3,146)				(3,146)
Issuance of common stock	5,000,000	50		353,672				353,722				353,722
Issuance of share-based compensation awards				4,664				4,664				4,664
Non-cash amortization of share-based compensation				32,813				32,813				32,813
Exercise of stock options	16,500	—		703				703				703
Settlement of restricted stock units for shares of common stock	463,276	5		(5)				—				—
Repurchase and cancellation of common stock, stock options and restricted stock units	(212,477)	(2)		(14,859)				(14,861)				(14,861)
Exchange of common units of the Operating Partnership	2,000	—		78				78		(78)		—
Distributions to noncontrolling interests in consolidated property partnerships								—		(12,952)		(12,952)
Adjustment for noncontrolling interest in the Operating Partnership				(3,102)				(3,102)		3,102		—
Dividends declared per share of common stock and common unit ($1.91 per share/unit)						(202,711)		(202,711)		(3,864)		(206,575)
BALANCE AS OF DECEMBER 31, 2019	106,016,287	1,060		4,350,917		(58,467)		4,293,510		277,348		4,570,858
Net income						187,105		187,105		20,188		207,293
Issuance of common stock (Note 13)	8,897,110	89		721,576				721,665				721,665
Issuance of share-based compensation awards (Note 15)				4,441				4,441				4,441
Non-cash amortization of share-based compensation (Note 15)				37,624				37,624				37,624
Settlement of restricted stock units for shares of common stock (Note 15)	441,416	4		(4)				—				—
Repurchase of common stock, stock options, and restricted stock units (Note 15)	(191,699)	(2)		(14,080)				(14,082)				(14,082)
Exchange of common units of the Operating Partnership (Note 11)	872,713	9		37,631				37,640		(37,640)		—
Distributions to noncontrolling interests in consolidated property partnerships								—		(15,247)		(15,247)
Adjustment for noncontrolling interest in the Operating Partnership (Note 2)				(6,189)				(6,189)		6,189		—
Dividends declared per share of common stock and common unit ($1.97 per share/unit) (Notes 13 and 27)						(231,771)		(231,771)		(3,460)		(235,231)
BALANCE AS OF DECEMBER 31, 2020	116,035,827	$	1,160	$	5,131,916	$	(103,133)	$	5,029,943	$	247,378	$	5,277,321

See accompanying notes to consolidated financial statements.

F - 6

KILROY REALTY CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

	Year Ended December 31,
	2020		2019		2018
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	207,293	$	215,229	$	277,926
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization of real estate assets and leasing costs	290,353		268,045		249,882
Depreciation of non-real estate furniture, fixtures and equipment	8,955		5,085		4,400
Revenue reversals (recoveries) for doubtful accounts (Notes 2 and 17)	18,997		(3,433)		5,685
Non-cash amortization of share-based compensation awards (Note 15)	30,245		27,007		27,932
Non-cash amortization of deferred financing costs and net debt discounts	2,958		1,427		1,084
Non-cash amortization of net below market rents (Note 5)	(7,603)		(9,206)		(9,748)
Gains on sales of depreciable operating properties (Note 4)	(35,536)		(36,802)		(142,926)
Non-cash amortization of deferred revenue related to tenant-funded tenant improvements (Note 10)	(17,547)		(19,190)		(18,429)
Straight-line rents	(67,826)		(72,023)		(26,976)
Amortization of right of use ground lease assets (Note 2)	825		683		—
Net change in other operating assets	(3,685)		(14,476)		(7,930)
Net change in other operating liabilities	28,161		24,175		48,345
Loss on early extinguishment of debt (Note 9)	—		—		12,623
Gain on sale of land (Note 4)	—		—		(11,825)
Net cash provided by operating activities	455,590		386,521		410,043
CASH FLOWS FROM INVESTING ACTIVITIES:
Expenditures for development properties and undeveloped land	(486,565)		(845,464)		(489,236)
Expenditures for operating properties and other capital assets	(129,500)		(147,687)		(166,440)
Net proceeds received from dispositions (Note 4)	74,937		124,421		364,300
(Increase) decrease in acquisition-related deposits	(1,000)		—		36,000
Expenditures for acquisitions of development properties and undeveloped land (Note 3)	—		(173,291)		(311,299)
Expenditures for acquisitions of operating properties (Note 3)	—		(186,258)		(257,340)
Proceeds received from repayment of note receivable	—		—		15,100
Net cash used in investing activities	(542,128)		(1,228,279)		(808,915)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from issuance of common stock (Note 13)	721,665		353,722		130,693
Net proceeds from the issuance of unsecured debt (Note 9)	772,297		499,390		648,537
Repayments of unsecured debt (Note 9)	(150,000)		—		(261,823)
Borrowings on unsecured revolving credit facility	190,000		1,110,000		765,000
Repayments on unsecured revolving credit facility	(435,000)		(910,000)		(690,000)
Principal payments and repayments of secured debt (Note 9)	(5,137)		(76,309)		(3,584)
Financing costs	(6,594)		(6,678)		(6,262)
Repurchase of common stock and restricted stock units (Note 15)	(14,082)		(14,556)		(16,553)
Distributions to noncontrolling interests in consolidated property partnerships	(15,247)		(12,952)		(11,803)
Dividends and distributions paid to common stockholders and common unitholders	(224,578)		(196,252)		(179,411)
Proceeds from exercise of stock options	—		703		41
Borrowings on unsecured debt	—		—		120,000
Contributions from noncontrolling interests in consolidated property partnerships	—		—		8,273
Net cash provided by financing activities	833,324		747,068		503,108
Net increase (decrease) in cash and cash equivalents and restricted cash	746,786		(94,690)		104,236
Cash and cash equivalents and restricted cash, beginning of year	76,344		171,034		66,798
Cash and cash equivalents and restricted cash, end of year	$	823,130	$	76,344	$	171,034

See accompanying notes to consolidated financial statements.

F - 7

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Partners of

Kilroy Realty, L.P.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Kilroy Realty, L.P. and subsidiaries (the “Operating Partnership”) as of December 31, 2020 and 2019, the related consolidated statements of operations, capital, and cash flows, for each of the three years in the period ended December 31, 2020, and the related notes and the schedules listed in the Index at Item 15 (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Operating Partnership as of December 31, 2020 and 2019, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2020, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Operating Partnership’s internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 12, 2021, expressed an unqualified opinion on the Operating Partnership’s internal control over financial reporting.

Basis for Opinion

These financial statements are the responsibility of the Operating Partnership’s management. Our responsibility is to express an opinion on the Operating Partnership’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Operating Partnership in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Rental Income, deferred revenue and acquisition-related intangible liabilities - Timing of Development Property Revenue Recognition and Ownership of Tenant Improvements - Refer to Notes 2 and 10 to the financial statements

Critical Audit Matter Description

The timing of when the Operating Partnership commences rental revenue recognition depends largely on the Operating Partnership’s determination of who is the owner of the tenant improvements of the leased space for accounting purposes. When management concludes that the Operating Partnership is the owner of the tenant improvements, the Operating Partnership records the cost to construct the tenant improvements as capital assets, and commences rental revenue recognition when the tenant takes possession of or controls the finished space, which is generally when the improvements being recorded are substantially complete. When management concludes that the Operating Partnership is not the owner and the tenant is the owner of certain tenant improvements for accounting

F - 8

purposes, the Operating Partnership records their contribution towards those tenant-owned improvements as a lease incentive, which is amortized as a reduction to rental revenue on a straight-line basis over the term of the related lease. Rental revenue recognition begins when the tenant takes possession of or controls the physical use of the leased space. Control is typically transferred when the Operating Partnership has completed all its obligations under the lease agreement in order for the leased space to be used by the tenant. The Operating Partnership’s determination of whether its obligations have been met and control has been transferred to the tenant can be complex for large development properties.

Construction for large development properties can include certain tenant improvements that are landlord-owned and others that are tenant-owned improvements. In making the determination of ownership of the tenant improvements, management considers numerous factors and performs a detailed evaluation of each individual lease. No one factor is determinative in reaching a conclusion and the factors management evaluates include but are not limited to (i) whether the lease agreement requires landlord approval of how the tenant improvement allowance is spent prior to installation of the tenant improvements (ii) whether the lease agreement requires the tenant to provide evidence to the landlord supporting the cost and what the tenant improvement allowance was spent on prior to payment by the landlord for such tenant improvements (iii) whether the tenant improvements are unique to the tenant or reusable by other tenants (iv) whether the tenant is permitted to alter or remove the tenant improvements without the consent of the landlord and (v) whether the ownership of the tenant improvements remains with the landlord or remains with the tenant at the end of the lease term. Further, large development properties can deliver leased space in phases, resulting in various revenue commencement dates with judgment surrounding when the tenant improvements that are landlord-owned, for a particular phase, are substantially complete.

Given the nature of construction work on large development properties, auditing management's judgments regarding the determination of the owner of the tenant improvements, when control of the leased space transfers to the tenant and when to begin rental revenue recognition involves especially subjective judgment. Performing audit procedures to evaluate the reasonableness of management’s conclusion on ownership of the tenant improvements, specifically related to whether the tenant improvements are unique to the tenant or reusable by other tenants, as well as the appropriate date for when control of the leased space transfers to the tenant required a high degree of auditor judgment and an increased extent of effort.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to determining the ownership of tenant improvements and when control of the leased space transfers to the tenant for development properties, thus the timing of the commencement of rental revenue recognition, included the following, among others:

•We tested the effectiveness of controls over revenue recognition, including those over the ownership of tenant improvements and the determination of when the tenant took possession of or controlled the leased space.

•We evaluated the reasonableness of management’s conclusions regarding the Operating Partnership’s ownership of tenant improvements by:

–Evaluating the Operating Partnership’s and the tenant’s respective obligations as governed by the lease agreements for selected leases against criteria for establishing ownership.

–Testing documentation supporting the nature of tenant improvements.

–Performing on-site inspections of selected development properties, as needed, to evaluate the nature of tenant improvements, particularly the uniqueness of the improvements.

•We evaluated the reasonableness of management’s conclusions regarding the possession of or control of the completed leased space and corresponding commencement of rental revenue recognition for development properties by:

–Testing documentation from construction contractors, architects, and city building inspection sign offs on temporary certificates of occupancy.

–Performing on-site inspections of selected development properties near the planned rental revenue recognition commencement date, as needed, to observe the status of the site and tenant improvements to evaluate whether control of the leased space had been or was ready to be transferred to the tenant.

/s/ DELOITTE & TOUCHE LLP

Los Angeles, California

February 12, 2021

We have served as the Operating Partnership’s auditor since 2010.

F - 9

KILROY REALTY, L.P.

CONSOLIDATED BALANCE SHEETS

(in thousands, except unit data)

	December 31, 2020		December 31, 2019
ASSETS
REAL ESTATE ASSETS (Notes 2, 3 and 4):
Land and improvements	$	1,628,848	$	1,466,166
Buildings and improvements	6,783,092		5,866,477
Undeveloped land and construction in progress	1,778,106		2,296,130
Total real estate assets held for investment	10,190,046		9,628,773
Accumulated depreciation and amortization	(1,798,646)		(1,561,361)
Total real estate assets held for investment, net	8,391,400		8,067,412
CASH AND CASH EQUIVALENTS (Note 23)	731,991		60,044
RESTRICTED CASH (Notes 3, 4 and 23)	91,139		16,300
MARKETABLE SECURITIES (Notes 16 and 19)	27,481		27,098
CURRENT RECEIVABLES, NET (Notes 2 and 6)	12,007		26,489
DEFERRED RENT RECEIVABLES, NET (Notes 2 and 6)	386,658		337,937
DEFERRED LEASING COSTS AND ACQUISITION-RELATED INTANGIBLE ASSETS, NET (Notes 2, 3 and 5)	210,949		212,805
RIGHT OF USE GROUND LEASE ASSET (Note 2 and 18)	95,523		96,348
PREPAID EXPENSES AND OTHER ASSETS, NET (Note 7)	53,560		55,661
TOTAL ASSETS	$	10,000,708	$	8,900,094
LIABILITIES AND CAPITAL
LIABILITIES:
Secured debt, net (Notes 9 and 19)	$	253,582	$	258,593
Unsecured debt, net (Notes 9 and 19)	3,670,099		3,049,185
Unsecured line of credit (Notes 9 and 19)	—		245,000
Accounts payable, accrued expenses and other liabilities (Note 18)	445,100		418,848
Ground lease liabilities (Note 2 and 18)	97,778		98,400
Accrued distributions (Notes 14 and 27)	59,431		53,219
Deferred revenue and acquisition-related intangible liabilities, net (Notes 2, 3, 5 and 10)	128,523		139,488
Rents received in advance and tenant security deposits	68,874		66,503
Total liabilities	4,723,387		4,329,236
COMMITMENTS AND CONTINGENCIES (Note 18)
CAPITAL:
Common units, 116,035,827 and 106,016,287 held by the general partner and 1,150,574 and 2,023,287 held by common limited partners issued and outstanding, respectively (Note 14)	5,079,818		4,369,758
Total partners’ capital	5,079,818		4,369,758
Noncontrolling interests in consolidated property partnerships and subsidiaries (Notes 2 and 12)	197,503		201,100
Total capital	5,277,321		4,570,858
TOTAL LIABILITIES AND CAPITAL	$	10,000,708	$	8,900,094

See accompanying notes to consolidated financial statements.

F - 10

KILROY REALTY, L.P.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except unit and per unit data)

	Year Ended December 31,
	2020		2019		2018
REVENUES (Note 2):
Rental income	$	892,306	$	826,472	$	656,631
Tenant reimbursements	—		—		80,982
Other property income	6,091		10,982		9,685
Total revenues	898,397		837,454		747,298
EXPENSES:
Property expenses (Note 2)	155,118		160,037		133,787
Real estate taxes (Note 2)	92,218		78,097		70,820
Provision for bad debts (Note 2)	—		—		5,685
Ground leases (Notes 2, 5 and 18)	8,891		8,113		6,176
General and administrative expenses (Notes 15 and 19)	99,264		88,139		90,471
Leasing costs (Notes 2 and 5)	4,493		7,615		—
Depreciation and amortization (Notes 2 and 5)	299,308		273,130		254,281
Total expenses	659,292		615,131		561,220
OTHER (EXPENSES) INCOME:
Interest income and other net investment gain (loss) (Note 19)	3,424		4,641		(559)
Interest expense (Note 9)	(70,772)		(48,537)		(49,721)
Gains on sales of depreciable operating properties (Note 4)	35,536		36,802		142,926
Loss on early extinguishment of debt (Note 9)	—		—		(12,623)
Net gain on sales of land (Note 4)	—		—		11,825
Total other (expenses) income	(31,812)		(7,094)		91,848
NET INCOME	207,293		215,229		277,926
Net income attributable to noncontrolling interests in consolidated property partnerships and subsidiaries (Notes 2 and 12)	(17,684)		(16,491)		(14,716)
NET INCOME AVAILABLE TO COMMON UNITHOLDERS	$	189,609	$	198,738	$	263,210
Net income available to common unitholders per unit – basic (Note 21)	$	1.63	$	1.87	$	2.56
Net income available to common unitholders per unit – diluted (Note 21)	$	1.62	$	1.86	$	2.55
Weighted average common units outstanding – basic (Note 21)	115,095,506		105,223,975		102,025,276
Weighted average common units outstanding – diluted (Note 21)	115,573,787		105,872,575		102,535,282

See accompanying notes to consolidated financial statements.

F - 11

KILROY REALTY, L.P.

CONSOLIDATED STATEMENTS OF CAPITAL

(in thousands, except unit and per unit data)

	Partners’ Capital			Noncontrolling Interests in Consolidated Property Partnerships and Subsidiaries
	Number of Common Units	Common Units				Total Capital
BALANCE AS OF DECEMBER 31, 2017	100,697,526	$	3,773,941	$	186,375	$	3,960,316
Net income		263,210		14,716		277,926
Issuance of common units	1,817,195	130,693				130,693
Issuance of share-based compensation awards		3,926				3,926
Non-cash amortization of share-based compensation		35,890				35,890
Exercise of stock options	1,000	41				41
Settlement of restricted stock units	488,354	—				—
Repurchase of common units and restricted stock units	(231,800)	(16,553)				(16,553)
Contributions from noncontrolling interest in consolidated property partnerships		—		8,273		8,273
Distributions to noncontrolling interests in consolidated property partnerships				(11,803)		(11,803)
Distributions declared per common unit ($1.79 per unit)		(187,448)				(187,448)
BALANCE AS OF DECEMBER 31, 2018	102,772,275	4,003,700		197,561		4,201,261
Net income		198,738		16,491		215,229
Opening adjustment to Partners’ Capital upon adoption of ASC 842 (Note 2)		(3,146)				(3,146)
Issuance of common units	5,000,000	353,722				353,722
Issuance of share-based compensation awards		4,664				4,664
Non-cash amortization of share-based compensation		32,813				32,813
Exercise of stock options	16,500	703				703
Settlement of restricted stock units	463,276	—				—
Repurchase and cancellation of common units and restricted stock units	(212,477)	(14,861)				(14,861)
Distributions to noncontrolling interests in consolidated property partnerships				(12,952)		(12,952)
Distributions declared per common unit ($1.91 per unit)		(206,575)				(206,575)
BALANCE AS OF DECEMBER 31, 2019	108,039,574	4,369,758		201,100		4,570,858
Net income		189,609		17,684		207,293
Issuance of common units (Note 14)	8,897,110	721,665				721,665
Issuance of share-based compensation awards (Note 15)		4,441				4,441
Non-cash amortization of share-based compensation (Note 15)		37,624				37,624
Settlement of restricted stock units (Note 15)	441,416	—				—
Repurchase of common units, stock options, and restricted stock units (Note 15)	(191,699)	(14,082)				(14,082)
Contribution of noncontrolling interests in consolidated subsidiary		6,034		(6,034)		—
Distributions to noncontrolling interests in consolidated property partnerships		—		(15,247)		(15,247)
Distributions declared per common unit ($1.97 per unit) (Notes 14 and 27)		(235,231)				(235,231)
BALANCE AS OF DECEMBER 31, 2020	117,186,401	$	5,079,818	$	197,503	$	5,277,321

See accompanying notes to consolidated financial statements.

F - 12

KILROY REALTY, L.P.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

	Year Ended December 31,
	2020		2019		2018
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	207,293	$	215,229	$	277,926
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization of real estate assets and leasing costs	290,353		268,045		249,882
Depreciation of non-real estate furniture, fixtures and equipment	8,955		5,085		4,400
Revenue reversals (recoveries) for doubtful accounts (Notes 2 and 17)	18,997		(3,433)		5,685
Non-cash amortization of share-based compensation awards (Note 15)	30,245		27,007		27,932
Non-cash amortization of deferred financing costs and net debt discounts	2,958		1,427		1,084
Non-cash amortization of net below market rents (Note 5)	(7,603)		(9,206)		(9,748)
Gains on sales of depreciable operating properties (Note 4)	(35,536)		(36,802)		(142,926)
Non-cash amortization of deferred revenue related to tenant-funded tenant improvements (Note 10)	(17,547)		(19,190)		(18,429)
Straight-line rents	(67,826)		(72,023)		(26,976)
Amortization of right of use ground lease assets (Note 2)	825		683		—
Net change in other operating assets	(3,685)		(14,476)		(7,930)
Net change in other operating liabilities	28,161		24,175		48,345
Loss on early extinguishment of debt (Note 9)	—		—		12,623
Gain on sale of land (Note 4)	—		—		(11,825)
Net cash provided by operating activities	455,590		386,521		410,043
CASH FLOWS FROM INVESTING ACTIVITIES:
Expenditures for development properties and undeveloped land	(486,565)		(845,464)		(489,236)
Expenditures for operating properties and other capital assets	(129,500)		(147,687)		(166,440)
Net proceeds received from dispositions (Note 4)	74,937		124,421		364,300
(Increase) decrease in acquisition-related deposits	(1,000)		—		36,000
Expenditures for acquisitions of development properties and undeveloped land (Note 3)	—		(173,291)		(311,299)
Expenditures for acquisitions of operating properties (Note 3)	—		(186,258)		(257,340)
Proceeds received from repayment of note receivable	—		—		15,100
Net cash used in investing activities	(542,128)		(1,228,279)		(808,915)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from issuance of common units (Note 14)	721,665		353,722		130,693
Net proceeds from the issuance of unsecured debt (Note 9)	772,297		499,390		648,537
Repayments of unsecured debt (Note 9)	(150,000)		—		(261,823)
Borrowings on unsecured revolving credit facility	190,000		1,110,000		765,000
Repayments on unsecured revolving credit facility	(435,000)		(910,000)		(690,000)
Principal payments and repayments of secured debt (Note 9)	(5,137)		(76,309)		(3,584)
Financing costs	(6,594)		(6,678)		(6,262)
Repurchase of common units and restricted stock units (Note 15)	(14,082)		(14,556)		(16,553)
Distributions to noncontrolling interests in consolidated property partnerships	(15,247)		(12,952)		(11,803)
Distributions paid to common unitholders	(224,578)		(196,252)		(179,411)
Proceeds from exercise of stock options	—		703		41
Borrowings on unsecured debt	—		—		120,000
Contributions from noncontrolling interests in consolidated property partnerships	—		—		8,273
Net cash provided by financing activities	833,324		747,068		503,108
Net increase (decrease) in cash and cash equivalents and restricted cash	746,786		(94,690)		104,236
Cash and cash equivalents and restricted cash, beginning of year	76,344		171,034		66,798
Cash and cash equivalents and restricted cash, end of year	$	823,130	$	76,344	$	171,034

See accompanying notes to consolidated financial statements.

F - 13

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.Organization and Ownership

Kilroy Realty Corporation (the “Company”) is a self-administered real estate investment trust (“REIT”) active in premier office and mixed-use 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 Greater Los Angeles, 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”). 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 properties at December 31, 2020:

	Number of Buildings	Rentable Square Feet (unaudited)	Number of Tenants	Percentage  Occupied (unaudited) (1)		Percentage Leased (unaudited)
Stabilized Office Properties (2)	117	14,620,166	447	91.2	%	94.3	%

_______________________

(1)Represents physical and economic occupancy.

(2)Includes stabilized life science and retail space.

	Number of Projects	Number of Units	2020 Average Occupancy (unaudited)
Stabilized Residential Properties	2	808	72.0	%

Our stabilized portfolio includes all of our properties with the exception of development and redevelopment properties currently committed for construction, under construction, or in the tenant improvement phase, undeveloped land and real estate assets held for sale. 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 properties in the tenant improvement phase as office and life science properties that we are developing or redeveloping where the project has reached cold shell condition and is ready for tenant improvements, which may require additional major base building construction before being placed in service. Projects in the tenant improvement phase are added to our stabilized portfolio once the project reaches the earlier of 95% occupancy or one year from the date of the cessation of major base building construction activities. Costs capitalized to construction in progress for development and redevelopment properties are transferred to land and improvements, buildings and improvements, and deferred leasing costs on our consolidated balance sheets at the historical cost of the property as the projects or phases of projects are placed in service.

During the year ended December 31, 2020, we added four development projects to our stabilized portfolio consisting of 750,370 square feet of office space in San Francisco, California, 361,388 square feet of office space in Hollywood, California, 95,871 square feet of retail space and 608 residential units in San Diego, California. As of December 31, 2020, the following properties were excluded from our stabilized portfolio. We did not have any redevelopment properties or properties held for sale at December 31, 2020.

F - 14

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

	Number of Properties/Projects	Estimated Rentable Square Feet (1) (unaudited)
In-process development projects - tenant improvement	3	1,080,000
In-process development projects - under construction (2)	3	856,000

____________________

(1)Estimated rentable square feet upon completion.

(2)In addition to the estimated office and life science rentable square feet noted above, development projects under construction also include 193 residential units.

Our stabilized portfolio also excludes our future development pipeline, which as of December 31, 2020 was comprised of five future development sites, representing approximately 61 gross acres of undeveloped land.

As of December 31, 2020, 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 eight stabilized office properties, one development project in the tenant improvement phase and one future development project located in the state of Washington. All of our properties and development projects are 100% owned, excluding four office properties owned by three consolidated property partnerships. Two of the three consolidated property partnerships, 100 First Street Member, LLC (“100 First LLC”) and 303 Second Street Member, LLC (“303 Second LLC”), each owned one office property in San Francisco, California through subsidiary REITs. As of December 31, 2020, the Company owned a 56% common equity interest in both 100 First LLC and 303 Second LLC. The third consolidated property partnership, Redwood City Partners, LLC (“Redwood LLC”) owned two office properties in Redwood City, California. As of December 31, 2020, the Company owned an approximate 93% common equity interest in Redwood LLC. The remaining interests in all three property partnerships were owned by unrelated third parties.

As of December 31, 2020, the Company owned an approximate 99.0% common general partnership interest in the Operating Partnership. The remaining approximate 1.0% common limited partnership interest in the Operating Partnership as of December 31, 2020 was owned by non-affiliated investors and certain of our executive officers and directors. 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”. With the exception of the Operating Partnership and our consolidated property partnerships, all of our subsidiaries are wholly-owned.

F - 15

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

2.    Basis of Presentation and Significant Accounting Policies

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, 303 Second LLC, 100 First LLC, 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, 303 Second LLC, 100 First LLC, Redwood LLC and all of our wholly-owned and controlled subsidiaries. All intercompany balances and transactions have been eliminated in the consolidated financial statements.

Partially Owned Entities and Variable Interest Entities

At December 31, 2020 the consolidated financial statements of the Company included two VIEs in addition to the Operating Partnership: 100 First LLC and 303 Second LLC. At December 31, 2020, the Company and the Operating Partnership were determined to be the primary beneficiaries of these two VIEs since we had the ability to control the activities that most significantly impact each of the VIEs’ economic performance. As of December 31, 2020, the two VIEs’ total assets, liabilities and noncontrolling interests included on our consolidated balance sheet were approximately $469.3 million (of which $394.6 million related to real estate held for investment), approximately $33.9 million and approximately $191.9 million, respectively. Revenues, income and net assets generated by 100 First LLC and 303 Second LLC may only be used to settle their contractual obligations, which primarily consist of operating expenses, capital expenditures and required distributions.

At December 31, 2019, the consolidated financial statements of the Company included four VIEs in addition to the Operating Partnership: two of the consolidated property partnerships, 100 First LLC and 303 Second LLC, and two entities established during the fourth quarter of 2019 to facilitate a Section 1031 Exchange. At December 31, 2019, the Company and the Operating Partnership were determined to be the primary beneficiaries of these four VIEs since we had the ability to control the activities that most significantly impact each of the VIEs’ economic performance. At December 31, 2019, the four VIEs’ total assets, liabilities and noncontrolling interests included on our consolidated balance sheet were approximately $676.7 million (of which $598.0 million related to real estate held for investment on our consolidated balance sheet), approximately $40.1 million and approximately $189.6 million, respectively.

Our accounting policy is to consolidate entities in which we have a controlling financial interest and significant decision making control over the entity's operations. In determining whether we have a controlling financial interest in a partially owned entity and the requirement to consolidate the accounts of that entity, we consider factors such as ownership interest, board representation, management representation, size of our investment (including loans), authority to control decisions, and contractual and substantive participating rights of the members. In addition to evaluating control rights, we consolidate entities in which the other members have no substantive kick-out rights to remove the Company as the managing member.

Entities in which the equity investors do not have sufficient equity at risk to finance their endeavors without additional financial support or the holders of the equity investment at risk do not have a controlling financial interest are VIEs. We evaluate whether an entity is a VIE and whether we are the primary beneficiary. We are deemed to be the primary beneficiary of a VIE when we have the power to direct the activities of the VIE that most significantly impact the VIEs’ economic performance and the obligation to absorb losses or receive benefits that could potentially be significant to the VIE.

If the requirements for consolidation are not met, the Company would account for investments under the equity method of accounting if we have the ability to exercise significant influence over the entity. Equity method investments would be initially recorded at cost and subsequently adjusted for our share of net income or loss and cash contributions and distributions each period. The Company did not have any equity method investments at December 31, 2020 or 2019.

F - 16

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Accounting Pronouncements Adopted January 1, 2020

ASU No. 2016-13 “Financial Instruments - Credit Losses (Topic 326)”

Effective January 1, 2020, we adopted Financial Accounting Standards Board (“FASB”) FASB Accounting Standards Update (“ASU”) No. 2016-13 (“ASU 2016-13”), which amends 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.  In November 2018, the FASB released ASU No. 2018-19 “Codification Improvements to Topic 326, Financial Instruments - Credit Losses.” This ASU clarifies that receivables arising from operating leases are not within the scope of Subtopic 326-20 “Financial Instruments – Credit Losses.” Instead, impairment of receivables arising from operating leases should be accounted for under Subtopic 842-30 “Leases – Lessor.” The adoption did not have a material impact on our consolidated financial statements or notes to our consolidated financial statements.

ASU No. 2018-13 “Fair Value Measurement (Topic 820)”

Effective January 1, 2020, we adopted FASB ASU No. 2018-13 (“ASU 2018-13”), which amends the disclosure requirements for fair value measurements. The amendments in ASU 2018-13 include new, modified and eliminated disclosure requirements and are the result of a broader disclosure project called FASB Concepts Statement, Conceptual Framework for Financial Reporting - Chapter 8: Notes to Financial Statements (the “Concepts Statement”), which the FASB finalized on August 28, 2018. The FASB used the guidance in the Concepts Statement to improve the effectiveness of Topic 820’s disclosure requirements. The adoption did not have a material impact on our consolidated financial statements or notes to our consolidated financial statements.

ASU No. 2018-15 “Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40)”

Effective January 1, 2020, we adopted FASB ASU No. 2018-15 (“ASU 2018-15”), which amends a customer’s accounting for implementation costs incurred in a cloud computing arrangement that is a service contract. ASU 2018-15 aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). The adoption did not have a material impact on our consolidated financial statements or notes to our consolidated financial statements.

COVID-19 Lease Modification Accounting Relief

The global impact of the COVID-19 pandemic continues to evolve rapidly. Both of the states where we own properties and/or have development projects (i.e., California and Washington), have reacted to the COVID-19 pandemic by instituting quarantines, restrictions on travel, “shelter in place” rules, restrictions on types of business that may continue to operate and/or restrictions on types of construction projects that may continue. These restrictions have impacted our business, as well as that of our tenants.

Due to the business disruptions and challenges severely affecting the global economy caused by the COVID-19 pandemic, many lessors may be required to provide rent deferrals and other lease concessions to lessees. While the lease modification guidance in Accounting Standards Codification (“ASC”) Topic 842 (“Topic 842”) addresses routine changes to lease terms resulting from negotiations between the lessee and the lessor, this guidance did not contemplate concessions being so rapidly executed to address the sudden liquidity constraints of some lessees arising from the COVID-19 pandemic and restrictions intended to prevent its spread.

In April 2020, the FASB staff issued a question and answer document (the “Lease Modification Q&A”) focused on the application of lease accounting guidance to lease concessions provided as a result of the COVID-19 pandemic. Under existing lease guidance, the Company would have to determine, on a lease by lease basis, if a lease concession was the result of a new arrangement reached with the tenant (treated within the lease modification accounting framework) or if a lease concession was under the enforceable rights and obligations within the existing lease agreement (precluded from applying the lease modification accounting framework). The Lease Modification Q&A allows the Company, if certain criteria have been met, to bypass the lease by lease analysis, and instead elect to either apply the lease modification accounting framework or not, with such election applied consistently to leases

F - 17

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

with similar characteristics and similar circumstances. The Company has elected to apply such relief and availed itself of the election to avoid performing a lease by lease analysis. In addition, the Company has elected to apply the lease modification accounting framework consistently to leases within the property types in which it invests, specifically office, life science, residential and retail properties.

Significant Accounting Policies

Revenue Recognition

Rental revenue for office, life science and retail operating properties is our principal source of revenue. We recognize revenue from base rent, additional rent (which consists of amounts due from tenants for common area maintenance, real estate taxes, and other recoverable costs), parking and other lease-related revenue once all of the following criteria are met: (i) the agreement has been fully executed and delivered, (ii) services have been rendered, (iii) the amount is fixed or determinable and (iv) payment has been received or the collectability of the amount due is probable. Lease termination fees are amortized over the remaining lease term, if applicable. If there is no remaining lease term, they are recognized when received and realized. Minimum annual rental revenues are recognized in rental revenues on a straight-line basis over the non-cancellable term of the related lease.

Base Rent

The timing of when we commence rental revenue recognition for office, life science and retail properties depends largely on our conclusion as to whether the Company or the tenant is the owner for accounting purposes of tenant improvements at the leased property. When we conclude that we are the owner of tenant improvements for accounting purposes, we record the cost to construct the tenant improvements as an asset and commence rental revenue recognition when the tenant takes possession of or controls the finished space, which is generally when tenant improvements being recorded as our assets are substantially complete. In certain instances, when we conclude that the tenant is the owner of certain tenant improvements for accounting purposes, rental revenue recognition begins when the tenant takes possession or controls the physical use of the leased space, which may occur in phases or for an entire building or project. The determination of who owns the tenant improvements is made on a lease-by-lease basis and has a significant effect on the timing of commencement of revenue recognition.

When we conclude that the Company is the owner of tenant improvements for accounting purposes, we record the cost to construct the tenant improvements, including costs paid for or reimbursed by the tenants, as a capital asset. For these tenant-funded tenant improvements, we record the amount funded by or reimbursed by tenants as deferred revenue, which is amortized and recognized as rental income on a straight-line basis over the term of the related lease.

When we conclude that the tenant is the owner of certain tenant improvements for accounting purposes, we record our contribution towards those tenant-owned improvements as a lease incentive, which is included in deferred leasing costs and acquisition-related intangible assets, net on our consolidated balance sheets and amortized as a reduction to rental revenue on a straight-line basis over the term of the related lease.

For residential properties, we commence revenue recognition upon lease commencement. Residential rental revenue is recognized on a straight-line basis over the term of the related lease, net of any concessions.

Additional Rent - Reimbursements from Tenants

Additional rent, consisting of amounts due from tenants for common area maintenance, real estate taxes and other recoverable costs, are recognized in rental income in the period the recoverable costs are incurred. Prior to the adoption of Topic 842 on January 1, 2019, such amounts were recognized in revenue as tenant reimbursements. Additional rent where we pay the associated costs directly to third-party vendors and are reimbursed by our tenants are recognized and recorded on a gross basis, with the corresponding expense recognized in property expenses or real estate taxes. Prior to the adoption of Topic 842, recoverable costs were generally recognized and recorded on a gross basis when we were the primary obligor with respect to purchasing goods and services from third-party suppliers, had discretion in selecting the supplier, and had credit risk.

F - 18

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Other Property Income

Other property income primarily includes amounts recorded in connection with transient daily parking, tenant bankruptcy settlement payments, broken deal income and property damage settlement related payments. Other property income also includes miscellaneous income from tenants, restoration fees and fees for late rental payments. Amounts recorded within other property income fall within the scope of Topic 606 and are recognized as revenue at the point in time when control of the goods or services transfers to the customer and our performance obligation is satisfied. Prior to the adoption of Topic 842 on January 1, 2019, other property income primarily included amounts recorded in connection with lease terminations, tenant bankruptcy settlement payments, broken deal income and property damage settlement payments.

Uncollectible Lease Receivables and Allowances for Tenant and Deferred Rent Receivables

We carry our current and deferred rent receivables net of allowances for amounts that may not be collected. Prior to the adoption of Topic 842 on January 1, 2019, the allowances were increased or decreased through provision for bad debts on our consolidated statements of operations. Upon the adoption of Topic 842 on January 1, 2019, the allowances are increased or decreased through rental income, and our determination of the adequacy of the Company’s allowances for tenant receivables includes a binary assessment of whether or not substantially all of the amounts due under a tenant’s lease agreement are probable of collection. Such assessment involves using a methodology that incorporates a specific identification analysis and an aging analysis and considers the current economic and business environment. This determination requires significant judgment and estimates about matters that are uncertain at the time the estimates are made, including the creditworthiness of specific tenants, specific industry trends and conditions, and general economic trends and conditions. For leases that are deemed probable of collection, revenue continues to be recorded on a straight-line basis over the lease term. For leases that are deemed not probable of collection, revenue is recorded as the lesser of (i) the amount which would be recognized on a straight-line basis or (ii) cash that has been received from the tenant, including deferred revenue, with any tenant and deferred rent receivable balances charged as a direct write-off against rental income in the period of the change in the collectability determination.

For tenant and deferred rent receivables associated with leases whose rents are deemed probable of collection under Topic 842, we may record an allowance under other authoritative GAAP using a methodology that incorporates a specific identification analysis and an aging analysis and considers the current economic and business environment. This determination requires significant judgment and estimates about matters that are uncertain at the time the estimates are made, including the creditworthiness of specific tenants, specific industry trends and conditions, and general economic trends and conditions. Tenant and deferred rent receivables deemed probable of collection are carried net of allowances for uncollectible accounts, with increases or decreases in the allowances recorded through rental income on our consolidated statements of operations. Prior to the adoption of Topic 842 on January 1, 2019, the allowances were increased or decreased through provision for bad debts on our consolidated statements of operations.

Current tenant receivables consist primarily of amounts due for contractual lease payments and reimbursements of common area maintenance expenses, property taxes, and other costs recoverable from tenants. With respect to the allowance for uncollectible tenant receivables, the specific identification methodology analysis relies on factors such as the age and nature of the receivables, the payment history and financial condition of the tenant, our assessment of the tenant’s ability to meet its lease obligations, and the status of negotiations of any disputes with the tenant.

Deferred rent receivables represent the amount by which the cumulative straight-line rental revenue recorded to date exceeds cash rents billed to date under the lease agreement. With respect to the allowance for deferred rent receivables, given the longer-term nature of these receivables, the specific identification methodology analysis evaluates each of our significant tenants and any tenants on our internal watchlist and relies on factors such as each tenant’s financial condition and its ability to meet its lease obligations. We evaluate our reserve levels quarterly based on changes in the financial condition of tenants and our assessment of the tenant’s ability to meet its lease obligations, overall economic conditions, and the current business environment.

F - 19

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Acquisitions

Acquisitions of operating properties and development and redevelopment opportunities generally do not meet the definition of a business and are accounted for as asset acquisitions, as substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets. For these asset acquisitions, we record the acquired tangible and intangible assets and assumed liabilities based on each asset’s and liability’s relative fair value at the acquisition date of the total purchase price plus any capitalized acquisition costs. We record the acquired tangible and intangible assets and assumed liabilities of acquisitions of operating properties and development and redevelopment opportunities that meet the accounting criteria to be accounted for as business combinations at fair value at the acquisition date. Transaction costs associated with asset acquisitions, including costs incurred during negotiation, are capitalized in addition to the purchase price of the acquisition.

The acquired assets and assumed liabilities for an acquisition generally include but are not limited to (i) land and improvements, buildings and improvements, undeveloped land and construction in progress and (ii) identified tangible and intangible assets and liabilities associated with in-place leases, including tenant improvements, leasing costs, value of above-market and below-market operating leases and ground leases, acquired in-place lease values and tenant relationships, if any. Any debt assumed and equity (including common units of the Operating Partnership) issued in connection with a property acquisition is recorded at fair value on the date of acquisition.

The fair value of land and improvements is derived from comparable sales of land and improvements within the same submarket and/or region. The fair value of buildings and improvements, tenant improvements and leasing costs considers the value of the property as if it was vacant as well as current replacement costs and other relevant market rate information.

The fair value of the above-market or below-market component of an acquired in-place operating lease is based upon the present value (calculated using a market discount rate) of the difference between (i) the contractual rents to be paid pursuant to the lease over its remaining non-cancellable lease term and (ii) our estimate of the rents that would be paid using fair market rental rates and rent escalations at the date of acquisition measured over the remaining non-cancellable term of the lease for above-market operating leases and the initial non-cancellable term plus the term of any below-market fixed rate renewal options, if applicable, for below-market operating leases. Our below-market operating leases generally do not include fixed rate or below-market renewal options. The amounts recorded for above-market operating leases are included in deferred leasing costs and acquisition-related intangible assets, net on the balance sheet and are amortized on a straight-line basis as a reduction of rental income over the remaining term of the applicable leases. The amounts recorded for below-market operating leases are included in deferred revenue and acquisition-related intangible liabilities, net on the balance sheet and are amortized on a straight-line basis as an increase to rental income over the remaining term of the applicable leases plus the term of any below-market fixed rate renewal options, if applicable. The amortization of a below-market ground lease obligation is recorded as an increase to ground lease expense in the consolidated statements of operations for the periods presented. The amortization of an 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 fair value of acquired in-place leases is derived based on our assessment of lost revenue and costs incurred for the period required to lease the “assumed vacant” property to the occupancy level when purchased. The amount recorded for acquired in-place leases is included in deferred leasing costs and acquisition-related intangible assets, net on the balance sheet and amortized as an increase to depreciation and amortization expense over the remaining term of the applicable leases. Fully amortized intangible assets are written off each quarter.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Operating Properties

Operating properties are generally carried at historical cost less accumulated depreciation. Properties held for sale are reported at the lower of the carrying value or the fair value less estimated cost to sell. The cost of operating properties includes the purchase price or development costs of the properties. Costs incurred for the renovation and betterment of the operating properties are capitalized to our investment in that property. Maintenance and repairs are charged to expense as incurred.

When evaluating properties to be held and used for potential impairment, we first evaluate whether there are any indicators of impairment for any of our properties. If any impairment indicators are present for a specific property, we then evaluate the regional market conditions that could reasonably affect the property. If there are negative changes and trends in that regional market, we then perform an undiscounted cash flow analysis and compare the net carrying amount of the property to the property’s estimated undiscounted future cash flow over the anticipated holding period. If the estimated undiscounted future cash flow is less than the net carrying amount of the property, we perform an impairment loss calculation to determine if the fair value of the property is less than the net carrying value of the property. Our impairment loss calculation compares the net carrying amount of the property to the property’s estimated fair value, which may be based on estimated discounted future cash flow calculations or third-party valuations or appraisals. We would recognize an impairment loss if the property's net carrying amount exceeds the property's estimated fair value. If we were to recognize an impairment loss, the estimated fair value of the property becomes its new cost basis. For a depreciable long-lived asset, the new cost basis would be depreciated (amortized) over the remaining useful life of that asset.

Cost Capitalization

All costs clearly associated with the development, redevelopment and construction of a property are capitalized as project costs, including internal compensation costs. In addition, the following costs are capitalized as project costs during periods in which activities necessary to prepare development and redevelopment properties for their intended use are in progress: pre-construction costs essential to the development of the property, interest, real estate taxes and insurance.

•For office, life science and retail development and redevelopment properties that are pre-leased, we cease capitalization when revenue recognition commences, which is upon substantial completion of tenant improvements deemed to be the Company’s asset for accounting purposes.

•For office, life science and retail development and redevelopment properties that are not pre-leased, we may not immediately build out the tenant improvements. Therefore, we cease capitalization when revenue recognition commences upon substantial completion of the tenant improvements deemed to be the Company's asset for accounting purposes, but in any event, no later than one year after the cessation of major construction activities. We also cease capitalization on a development or redevelopment property when activities necessary to prepare the property for its intended use have been suspended.

•For office, life science and retail development or redevelopment properties with multiple tenants and phased leasing, we cease capitalization and begin depreciation on the portion of the development or redevelopment property for which revenue recognition has commenced.

•For residential development properties, we cease capitalization when the property is substantially complete and available for occupancy.

Once major base building construction activities have ceased and the development or redevelopment property or phases of the development or redevelopment project is placed in service, which may occur in phases or for an entire building or project, the costs capitalized to construction in progress are transferred to land and improvements, buildings and improvements, and deferred leasing costs on our consolidated balance sheets as the historical cost of the property.

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KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Depreciation and Amortization of Buildings and Improvements

The costs of buildings and improvements and tenant improvements are depreciated using the straight-line method of accounting over the estimated useful lives set forth in the table below. Depreciation expense for buildings and improvements for the three years ended December 31, 2020, 2019, and 2018 was $244.8 million, $211.9 million, and $198.6 million, respectively.

Asset Description	Depreciable Lives
Buildings and improvements	25 – 40 years
Tenant improvements	1 – 20 years (1)

____________________

(1)Tenant improvements are amortized over the shorter of the lease term or the estimated useful life. 

Real Estate Assets Held for Sale, Dispositions and Discontinued Operations

A real estate asset is classified as held for sale when certain criteria are met, including but not limited to the availability of the asset for immediate sale, the existence of an active program to locate a buyer and the probable sale or transfer of the asset within one year. If such criteria are met, we present the applicable assets and liabilities related to the real estate asset, if material, separately on the balance sheet as held for sale and we would cease to record depreciation and amortization expense. Real estate assets held for sale are reported at the lower of their carrying value or their estimated fair value less the estimated costs to sell. As of December 31, 2020 and 2019, we did not have any properties classified as held for sale.

Property disposals representing a strategic shift that have (or will have) a major effect on the Company’s operations and financial results, such as a major line of business, a major geographical area or a major equity investment, are required to be presented as discontinued operations. If we were to determine that a property disposition represents a strategic shift, the revenues, expenses and net gain (loss) on dispositions of the property would be recorded in discontinued operations for all periods presented through the date of the applicable disposition. The operations of the properties sold during the years ended December 31, 2020, 2019 and 2018 are presented in continuing operations as they did not represent a strategic shift in the Company’s operations and financial results.

The net gains (losses) on dispositions of non-depreciable real estate property, including land, are reported in the consolidated statements of operations as gains (losses) on sale of land within continuing operations in the period the land is sold. The net gains (losses) on dispositions of depreciable real estate property are reported in the consolidated statements of operations as gains on sales of depreciable operating properties within continuing operations in the period the property is sold.

Cash and Cash Equivalents

We consider all highly-liquid investments with original maturities of three months or less to be cash equivalents.

Restricted Cash

Restricted cash consists of cash proceeds from dispositions that are temporarily held at qualified intermediaries for purposes of facilitating potential Section 1031 Exchanges and cash held in escrow related to acquisition and disposition holdbacks. Restricted cash also includes cash held as collateral to provide credit enhancement for the Operating Partnership’s mortgage debt, including cash reserves for capital expenditures, tenant improvements and property taxes. As of December 31, 2020, we had $74.9 million of restricted cash held at qualified intermediaries for the purpose of facilitating Section 1031 Exchanges. In January 2021, the Section 1031 Exchange was terminated and the cash proceeds were released from the qualified intermediary. We did not have any restricted cash held at qualified intermediaries for the purpose of facilitating Section 1031 Exchanges at December 31, 2019.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Marketable Securities / Deferred Compensation Plan

Marketable securities reported in our consolidated balance sheets represent the assets held in connection with the Kilroy Realty Corporation 2007 Deferred Compensation Plan (the “Deferred Compensation Plan”) (see Note 16 “Employee Benefit Plans” for additional information). The Deferred Compensation Plan assets are held in a limited rabbi trust and invested in various mutual and money market funds. As a result, the marketable securities are treated as trading securities for financial reporting purposes and are adjusted to fair value at the end of each accounting period, with the corresponding gains and losses recorded in interest income and other net investment gains (losses).

At the time eligible management employees (“Participants”) defer compensation or earn mandatory Company contributions, or if we were to make a discretionary contribution, we record compensation cost and a corresponding deferred compensation plan liability, which is included in accounts payable, accrued expenses, and other liabilities on our consolidated balance sheets. This liability is adjusted to fair value at the end of each accounting period based on the performance of the benchmark funds selected by each Participant, and the impact of adjusting the liability to fair value is recorded as an increase or decrease to compensation cost. The impact of adjusting the deferred compensation plan liability to fair value and the changes in the value of the marketable securities held in connection with the Deferred Compensation Plan generally offset and therefore do not significantly impact net income.

Deferred Leasing Costs

Costs incurred in connection with successful property leasing are capitalized as deferred leasing costs and classified as investing activities in the statement of cash flows. Under Topic 842, initial direct costs include only those costs that are incremental to the arrangement and would not have been incurred if the lease had not been obtained. As a result, subsequent to the adoption of Topic 842 on January 1, 2019, deferred leasing costs consist of leasing commissions paid to external third party brokers and lease incentives, and the Company no longer capitalizes internal leasing costs and third-party legal leasing costs. Prior to the adoption of Topic 842, deferred leasing costs consisted primarily of leasing commissions, lease incentives, legal costs and certain internal payroll costs. Deferred leasing costs are amortized using the straight-line method of accounting over the lives of the leases which generally range from one to 20 years. We may reevaluate the remaining useful lives of leasing costs as the creditworthiness of our tenants and economic and market conditions change. If we determine that the estimated remaining life of a lease has changed, we adjust the amortization period accordingly. Fully amortized deferred leasing costs are written off each quarter.

Deferred Financing Costs

Financing costs related to the origination or assumption of long-term debt are deferred and generally amortized using the straight-line method of accounting, which approximates the effective interest method, over the contractual terms of the applicable financings. Fully amortized deferred financing costs are written off when the corresponding financing is repaid.

Debt Discounts and Premiums

Original issuance debt discounts and discounts/premiums related to recording debt acquired in connection with operating property acquisitions at fair value are generally amortized and accreted on a straight-line basis, which approximates the effective interest method. Discounts are recorded as additional interest expense from date of issuance or acquisition through the contractual maturity date of the related debt. Premiums are recorded as a reduction to interest expense from the date of issuance or acquisition through the contractual maturity date of the related debt.

Noncontrolling Interests - Common Units of the Operating Partnership in the Company's Consolidated Financial Statements

Common units of the Operating Partnership within noncontrolling interests in the Company’s consolidated financial statements represent the common limited partnership interests in the Operating Partnership not held by the Company (“noncontrolling common units”). Noncontrolling common units are presented in the equity section of the

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Company’s consolidated balance sheets and are reported at their proportionate share of the net assets of the Operating Partnership. Noncontrolling interests with redemption provisions that permit the issuer to settle in either cash or shares of common stock must be further evaluated to determine whether equity or temporary equity classification on the balance sheet is appropriate. Since the common units contain such a provision, we evaluated the accounting guidance and determined that the common units qualify for equity presentation in the Company’s consolidated financial statements. Net income attributable to noncontrolling common units is allocated based on their relative ownership percentage of the Operating Partnership during the reported period. The noncontrolling interest ownership percentage is determined by dividing the number of noncontrolling common units by the total number of common units outstanding. The issuance or redemption of additional shares of common stock or common units results in changes to the noncontrolling interest percentage as well as the total net assets of the Company. As a result, all equity transactions result in an allocation between equity and the noncontrolling interest in the Company’s consolidated balance sheets and statements of equity to account for the changes in the noncontrolling interest ownership percentage as well as the change in total net assets of the Company.

Noncontrolling Interests in Consolidated Property Partnerships

Noncontrolling interests in consolidated property partnerships represent the equity interests held by unrelated third parties in our three consolidated property partnerships (see Note 11 “Noncontrolling Interests on the Company’s Consolidated Financial Statements” and see Note 12 “Noncontrolling Interests on the Operating Partnership’s Consolidated Financial Statements”). Noncontrolling interests in consolidated property partnerships are not redeemable and are presented as permanent equity in the Company's consolidated balance sheets. We account for the noncontrolling interests in consolidated property partnerships using the hypothetical liquidation at book value (“HLBV”) method to attribute the earnings or losses of the consolidated property partnerships between the controlling and noncontrolling interests. Under the HLBV method, the amounts reported as noncontrolling interests in consolidated property partnerships in the consolidated balance sheets represent the amounts the noncontrolling interests would hypothetically receive at each balance sheet reporting date under the liquidation provisions of the governing agreements assuming the net assets of the consolidated property partnerships were liquidated at recorded amounts and distributed between the controlling and noncontrolling interests in accordance with the governing documents. The net income attributable to noncontrolling interests in consolidated property partnerships in the consolidated statements of operations is associated with the increase or decrease in the noncontrolling interest holders’ contractual claims on the respective entities’ balance sheets assuming a hypothetical liquidation at the end of that reporting period when compared with their claims on the respective entities’ balance sheets assuming a hypothetical liquidation at the beginning of that reporting period, after removing any contributions or distributions.

Common Partnership Interests on the Operating Partnership’s Consolidated Balance Sheets

The common units held by the Company and the noncontrolling common units held by the common limited partners are both presented in the permanent equity section of the Operating Partnership’s consolidated balance sheets in partners’ capital. The redemption rights of the noncontrolling common units permit us to settle the redemption obligation in either cash or shares of the Company’s common stock at our option (see Note 11 “Noncontrolling Interests on the Company’s Consolidated Financial Statements” for additional information).

Noncontrolling Interests on the Operating Partnership’s Consolidated Financial Statements

Noncontrolling interests in the Operating Partnership’s consolidated financial statements include the noncontrolling interest in property partnerships (see Note 12 “Noncontrolling Interests on the Operating Partnership’s Consolidated Financial Statements”). As of December 31, 2019, noncontrolling interests in the Operating Partnership’s consolidated financial statements also included the Company’s 1.0% general partnership interest in Kilroy Realty Finance Partnership, L.P. in the permanent equity section of the Operating Partnership’s consolidated balance sheets given that these interests were not convertible or redeemable into any other ownership interest of the Company or the Operating Partnership.

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KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Equity Offerings

Underwriting commissions and offering costs incurred in connection with common equity offerings and our at-the-market stock offering program (see Note 13 “Stockholders’ Equity of the Company”) are reflected as a reduction of additional paid-in capital. Issuance costs incurred in connection with preferred equity offerings are reflected as a reduction of the carrying value of the preferred equity.

Sales of our common stock under forward equity sale agreements (such as those under the forward equity offering entered into in February 2020 and those under the 2018 At-The-Market Program, as discussed in Note 13 “Stockholders’ Equity of the Company”) meet the derivatives and hedging guidance scope exception to be accounted for as equity instruments based on the following assessment: (i) none of the agreements’ exercise contingencies were based on observable markets or indices besides those related to the market for our own stock price and operations; and (ii) none of the settlement provisions precluded the agreements from being indexed to our own stock.

The net proceeds from any equity offering of the Company are generally contributed to the Operating Partnership in exchange for a number of common units equivalent to the number of shares of common stock issued and are reflected in the Operating Partnership’s consolidated financial statements as an increase in partners’ capital.

Share-based Incentive Compensation Accounting

Compensation cost for all share-based awards, including options, requires measurement at estimated fair value on the grant date. Compensation cost is recognized on a straight-line basis over the service vesting period, which represents the requisite service period. The grant date fair value of market measure-based share-based compensation plans are calculated using a Monte Carlo simulation pricing model. The grant date fair value of stock option grants is calculated using the Black-Scholes valuation model. Equity awards settled in cash are valued at the fair value of our common stock on the period end date through the settlement date. Equity awards settled in cash are remeasured at each reporting period and are recognized as a liability in the consolidated balance sheet during the vesting period until settlement. Forfeitures of all share-based awards are recognized when they occur.

For share-based awards in which the performance period precedes the grant date, we recognize compensation cost over the requisite service period, which includes both the performance and service vesting periods, using the accelerated attribution expense method. The requisite service period begins on the date the Executive Compensation Committee authorizes the award and adopts any relevant performance measures.

For share-based awards with performance-based measures, the total estimated compensation cost is based on our most recent estimate of the probable achievement of the pre-established specific corporate performance measures. These estimates are based on actual results and our latest internal forecasts for each performance measure. For share-based awards with market measures, the total estimated compensation cost is based on the fair value of the award at the grant date. For share-based awards with performance-based measures and market measures, the total estimated compensation cost is based on the fair value per share at the grant date multiplied by our most recent estimate of the number of shares to be earned based on actual results and the probable achievement of the pre-established corporate performance measures based on our latest internal forecasts.

In accordance with the provisions of our share-based incentive compensation plan, we accept the return of shares of Company common stock, at the current quoted market price, from employees to satisfy minimum statutory tax-withholding requirements related to shares that vested during the period.

For share-based awards granted by the Company, the Operating Partnership issues a number of common units equal to the number of shares of common stock ultimately granted by the Company in respect of such awards.

Basic and Diluted Net Income Available to Common Stockholders per Share

Basic net income available to common stockholders per share is computed by dividing net income available to common stockholders, after preferred distributions and the allocation of income to participating securities, by the

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

weighted-average number of shares of common stock outstanding for the period. Diluted net income available to common stockholders per share is computed by dividing net income available for common stockholders, after preferred distributions and the allocation of income to participating securities, by the sum of the weighted-average number of shares of common stock outstanding for the period plus the assumed exercise of all dilutive securities. The impact of the outstanding common units is considered in the calculation of diluted net income available to common stockholders per share. The common units are not reflected in the diluted net income available to common stockholders per share calculation because the exchange of common units into common stock is on a one for one basis, and the common units are allocated net income on a per share basis equal to the common stock (see Note 21 “Net Income Available to Common Stockholders Per Share of the Company”). Accordingly, any exchange would not have any effect on diluted net income (loss) available to common stockholders per share.

Nonvested share-based payment awards (including nonvested restricted stock units (“RSUs”), vested market-measure RSUs and vested dividend equivalents issued to holders of RSUs) containing nonforfeitable rights to dividends or dividend equivalents are accounted for as participating securities and included in the computation of basic and diluted net income available to common stockholders per share pursuant to the two-class method. The dilutive effect of shares issuable under executed forward equity sale agreements, if any, and stock options are reflected in the weighted average diluted outstanding shares calculation by application of the treasury stock method. The dilutive effect of the outstanding nonvested shares of common stock (“nonvested shares”) and RSUs that have not yet been granted but are contingently issuable under the share-based compensation programs is reflected in the weighted average diluted shares calculation by application of the treasury stock method at the beginning of the quarterly period in which all necessary conditions have been satisfied.

Basic and Diluted Net Income Available to Common Unitholders per Unit

Basic net income available to common unitholders per unit is computed by dividing net income available to common unitholders, after preferred distributions and the allocation of income to participating securities, by the weighted-average number of vested common units outstanding for the period. Diluted net income available to common unitholders per unit is computed by dividing net income available to common unitholders, after preferred distributions and the allocation of income to participating securities, by the sum of the weighted-average number of common units outstanding for the period plus the assumed exercise of all dilutive securities.

The dilutive effect of stock options, outstanding nonvested shares, RSUs, awards containing nonforfeitable rights to dividend equivalents and shares issuable under executed forward equity sale agreements, if any, are reflected in diluted net income available to common unitholders per unit in the same manner as noted above for net income available to common stockholders per share.

Fair Value Measurements

The fair values of our financial assets and liabilities are disclosed in Note 19, “Fair Value Measurements and Disclosures,” to our consolidated financial statements. The only financial assets recorded at fair value on a recurring basis in our consolidated financial statements are our marketable securities. We elected not to apply the fair value option for any of our eligible financial instruments or other items.

We determine the estimated fair value of financial assets and liabilities utilizing a hierarchy of valuation techniques based on whether the inputs to a fair value measurement are considered to be observable or unobservable in a marketplace. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect our market assumptions. This hierarchy requires the use of observable market data when available. The following is the fair value hierarchy:

•Level 1 – quoted prices for identical instruments in active markets;

•Level 2 – quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

•Level 3 – fair value measurements derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

We determine the fair value for the marketable securities using quoted prices in active markets for identical assets. Our other financial instruments, which are only disclosed at fair value, are comprised of secured debt, unsecured senior notes, unsecured line of credit and unsecured term loan facility.

We generally determine the fair value of our secured debt, unsecured debt, unsecured line of credit and unsecured term loan facility, prior to its repayment in August 2020, by performing discounted cash flow analyses using an appropriate market discount rate. We calculate the market rate by obtaining period-end treasury rates for maturities that correspond to the maturities of our fixed-rate debt and then adding an appropriate credit spread based on information obtained from third-party financial institutions. These credit spreads take into account factors, including but not limited to, our credit profile, the tenure of the debt, amortization period, whether the debt is secured or unsecured, and the loan-to-value ratio of the debt to the collateral. These calculations are significantly affected by the assumptions used, including the discount rate, credit spreads and estimates of future cash flow. We calculate the market rate of our unsecured line of credit and unsecured term loan facility by obtaining the period-end London Interbank Offered Rate (“LIBOR”) and then adding an appropriate credit spread based on our credit ratings, and the amended terms of our unsecured line of credit and unsecured term loan facility agreement. We determine the fair value of each of our publicly traded unsecured senior notes based on their quoted trading price at the end of the reporting period, if such prices are available.

Carrying amounts of our cash and cash equivalents, restricted cash and accounts payable approximate fair value due to their short-term maturities.

Income Taxes

We have elected to be taxed as a REIT under Sections 856 through 860 of the Code. To qualify as a REIT, we must distribute annually at least 90% of our adjusted taxable income, as defined in the Code, to our stockholders and satisfy certain other organizational and operating requirements. We generally will not be subject to federal income taxes if we distribute 100% of our taxable income for each year to our stockholders. If we fail to qualify as a REIT in any taxable year, we will be subject to federal income taxes on our taxable income at regular corporate rates and we may not be able to qualify as a REIT for four subsequent taxable years. Even if we qualify for taxation as a REIT, we may be subject to certain state and local taxes on our income and property and to federal income taxes and excise taxes on our undistributed taxable income. We believe that we have met all of the REIT distribution and technical requirements for the years ended December 31, 2020, 2019 and 2018, and we were not subject to any federal income taxes (see Note 25 “Tax Treatment of Distributions” for additional information). We intend to continue to adhere to these requirements and maintain the Company’s REIT status. Accordingly, no provision for income taxes has been made in the accompanying financial statements.

In addition, any taxable income from our taxable REIT subsidiaries, which were formed in 2002, 2018, 2019 and 2020, are subject to federal, state, and local income taxes. For the years ended December 31, 2020, 2019 and 2018 the taxable REIT subsidiaries had de minimis taxable income.

Uncertain Tax Positions

We include favorable tax positions in the calculation of tax liabilities if it is more likely than not that our adopted tax position will prevail if challenged by tax authorities.

We evaluated the potential impact of identified uncertain tax positions for all tax years still subject to audit under state and federal income tax law and concluded that we did not have any unrecognized tax benefits or any additional tax liabilities as of December 31, 2020 or 2019. As of December 31, 2020, the years still subject to audit are 2016 through 2020 under the California state income tax law and 2017 through 2020 under the federal income tax law.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Use of Estimates

The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported periods. Actual results could differ from those estimates.

Segments

We currently operate in one operating segment, our office and life science properties segment.

Concentration of Credit Risk

All of our properties and development and redevelopment projects are owned and all of our business is currently conducted in the state of California with the exception of the ownership and operation of eight office properties, one development project in the tenant improvement phase and one future development project located in the state of Washington. The ability of tenants to honor the terms of their leases is dependent upon the economic, regulatory, and social factors affecting the communities in which our tenants operate.

We have deposited cash with financial institutions that is insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000 per institution. As of December 31, 2020 and 2019, we had cash accounts in excess of FDIC insured limits.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

3.    Acquisitions

Operating Property Acquisitions

We did not acquire any operating properties during the year ended December 31, 2020. During the year ended December 31, 2019, we acquired the 19-building creative office campus listed below in one transaction from an unrelated third party.

Property	Date of Acquisition	Number of Buildings	Rentable Square Feet (unaudited)	Purchase Price (in millions) (1)
2019 Acquisitions
3101-3243 La Cienega Boulevard, Culver City, CA (2)	October 15, 2019	19	151,908	$	186.0

________________________ 

(1)Excludes acquisition-related costs.

(2)The results of operations for the properties acquired during 2019 contributed $3.7 million to revenue and a net loss of $0.1 million for the year ended December 31, 2019 primarily due to a write-off of lease-related intangible assets as a result of an early lease termination during the year ended December 31, 2019.

The related assets, liabilities and results of operations of the acquired properties are included in the consolidated financial statements as of the date of acquisition. The following table summarizes the estimated relative fair values of the assets and liabilities assumed at the acquisition date for our 2019 operating property acquisitions:

	Total 2019 Operating Property Acquisition (1)
Assets
Land and improvements	$	150,561
Buildings and improvements (2)	30,932
Deferred leasing costs and acquisition-related intangible assets (3)	12,063
Right of use ground lease asset (4)	13,334
Total assets acquired	$	206,890
Liabilities
Acquisition-related intangible liabilities (5)	$	9,950
Ground lease liability (4)	10,940
Total liabilities assumed	$	20,890
Net assets and liabilities acquired	$	186,000

________________________ 

(1)The purchase price of the acquisition completed during the year ended December 31, 2019 was less than 10% of the Company’s total assets as of December 31, 2018.

(2)Represents buildings, building improvements and tenant improvements.

(3)Represents in-place leases (approximately $9.2 million with a weighted average amortization period of 3.3 years) and leasing commissions (approximately $2.9 million with a weighted average amortization period of 3.5 years).

(4)We evaluated the ground lease assumed in connection with the 2019 operating property acquisition and concluded it met the criteria to be classified as an operating lease. The discount rate used in determining the present value of the minimum future lease payments was 4.79%. The right of use asset ground lease asset is equal to the ground lease liability adjusted for above and below market intangibles and deferred leasing costs. Refer to Note 18 “Commitments and Contingencies” for further discussion of the Company's ground lease obligations.

(5)Represents below-market leases (approximately $10.0 million with a weighted average amortization period of 3.5 years).

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Development Project Acquisitions

We did not acquire any development sites during the year ended December 31, 2020. During the year ended December 31, 2019, we acquired the following development sites in two transactions from unrelated third parties. The acquisitions were funded from various sources of liquidity including proceeds from the Company’s unsecured revolving credit facility, the issuance of debt and the settlement of the Company’s 2018 forward equity sale agreements.

Project	Date of Acquisition	City/Submarket	Purchase Price (in millions)
2019 Acquisitions
1335 Broadway & 901 Park Boulevard, San Diego, CA (1)	August 19, 2019	East Village	$	40.0
Seattle CBD Project (2)	December 12, 2019	Seattle CBD	133.0
Total 2019 Acquisitions			$	173.0

_______________________ 

(1)Excludes acquisition-related costs. In connection with this acquisition, we also recorded $4.0 million in accrued liabilities and environmental remediation liabilities at the date of acquisition, which are not included in the purchase price above. As of December 31, 2019, the purchase price and our current estimate of assumed liabilities are included in undeveloped land and construction in progress and the assumed liabilities are included in accounts payable, accrued expenses and other liabilities on the Company’s consolidated balance sheets.

(2)Excludes acquisition-related costs. In connection with this acquisition, we also recorded $6.3 million in accrued liabilities and environmental remediation liabilities at the date of acquisition, which are not included in the purchase price above. As of December 31, 2019, the purchase price and our current estimate of assumed liabilities are included in undeveloped land and construction in progress and the assumed liabilities are included in accounts payable, accrued expenses and other liabilities on the Company’s consolidated balance sheets. In addition, as of December 31, 2020 and 2019, the Company had $10.0 million in restricted cash, which is excluded from the purchase price above, related to this acquisition which may be payable to the seller only if certain events occur within three years following the date of acquisition.

In addition to the acquisitions listed above, during 2019, we acquired an additional land parcel for an existing development project for $99.5 million.

Acquisition Costs

During the years ended December 31, 2020, 2019, and 2018, we capitalized $0.3 million, $1.6 million, and $3.8 million, respectively, of acquisition costs.

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KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

4.        Dispositions

Operating Property Dispositions

The following table summarizes the operating properties sold during the years ended December 31, 2020, 2019 and 2018:

Location	Month of Disposition	Number of Buildings	Rentable Square Feet (unaudited)	Sales Price (in millions) (1)
2020 Dispositions
331 Fairchild Drive, Mountain View, CA	December	1	87,147	$	75.9
Total 2020 Dispositions		1	87,147	$	75.9
2019 Dispositions
2829 Townsgate Road, Thousand Oaks, CA	May	1	84,098	$	18.3
2211 Michelson Drive, Irvine, CA	October	1	271,556	115.5
Total 2019 Dispositions		2	355,654	$	133.8
2018 Dispositions
1310-1327 Chesapeake Terrace, Sunnyvale, CA	November	4	266,982	$	160.3
Plaza Yarrow Bay Properties (2)	November	4	279,924	134.5
23925, 23975, & 24025 Park Sorrento, Calabasas, CA	December	3	225,340	78.2
Total 2018 Dispositions		11	772,246	$	373.0

____________________

(1)Represents gross sales price before broker commissions and closing costs.

(2)The Plaza Yarrow Bay Properties include the following properties: 10210, 10220 and 10230 NE Points Drive & 3933 Lake Washington Boulevard NE in Kirkland, Washington.

The total gains on the sales of the operating properties sold during the years ended December 31, 2020, 2019 and 2018 were $35.5 million, $36.8 million and $142.9 million, respectively.

Land Dispositions

We did not dispose of any land parcels during the years ended December 31, 2020 and 2019. During the year ended December 31, 2018, in connection with the Plaza Yarrow Bay Properties disposition listed above, we recognized a gain on sale of land of $11.8 million.

Restricted Cash Related to Dispositions

As of December 31, 2020, approximately $74.9 million of net proceeds related to the operating property disposition during the year ended December 31, 2020 were temporarily being held at a qualified intermediary at our direction, for the purpose of facilitating a Section 1031 Exchange. The cash proceeds were included in restricted cash on our consolidated balance sheets at December 31, 2020. During January 2021, the Section 1031 Exchange was terminated and the cash proceeds were released from the qualified intermediary. We did not have any restricted cash related to dispositions or Section 1031 Exchanges as of December 31, 2019.

F - 31

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

5.    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, and in-place leases) and intangible liabilities (acquired value of below-market operating leases) as of December 31, 2020 and 2019:

	December 31, 2020		December 31, 2019
	(in thousands)
Deferred Leasing Costs and Acquisition-related Intangible Assets, net:
Deferred leasing costs	$	300,556	$	286,026
Accumulated amortization	(104,277)		(100,145)
Deferred leasing costs, net	196,279		185,881
Above-market operating leases	—		611
Accumulated amortization	—		(116)
Above-market operating leases, net	—		495
In-place leases	40,323		58,076
Accumulated amortization	(25,653)		(31,647)
In-place leases, net	14,670		26,429
Total deferred leasing costs and acquisition-related intangible assets, net	$	210,949	$	212,805
Acquisition-related Intangible Liabilities, net: (1)
Below-market operating leases	$	26,405	$	51,263
Accumulated amortization	(13,060)		(27,171)
Below-market operating leases, net	13,345		24,092
Total acquisition-related intangible liabilities, net	$	13,345	$	24,092

____________________

(1)Included in deferred revenue and acquisition-related intangible liabilities, net in the consolidated balance sheets.

F - 32

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The following table sets forth amortization related to deferred leasing costs and acquisition-related intangibles for the years ended December 31, 2020, 2019 and 2018.

	Year Ended December 31,
	2020		2019		2018
	(in thousands)
Deferred leasing costs (1)	$	33,624	$	35,779	$	34,341
Above-market operating leases (2)	495		192		444
In-place leases (1)	11,759		18,615		15,915
Below-market ground lease obligation (3)	—		—		8
Below-market operating leases (4)	(10,748)		(9,398)		(10,192)
Above-market ground lease obligation (3)	—		—		(101)
Total	$	35,130	$	45,188	$	40,415

____________________

(1)    The amortization of deferred leasing costs and in-place leases is recorded to depreciation and amortization expense and the amortization of lease incentives is recorded as a reduction to rental income 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)    Upon adoption of Topic 842 on January 1, 2019 (refer to Note 2 “Basis of Presentation and Significant Accounting Policies”), we no longer separately recognize above or below-market ground lease obligations. Refer to Note 18 “Commitments and Contingencies” for further discussion of our ground lease obligations.

(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.

The following table sets forth the estimated annual amortization expense related to deferred leasing costs and acquisition-related intangibles as of December 31, 2020 for future periods:

Year	Deferred Leasing Costs		In-Place Leases		Below-Market Operating Leases (1)
	(in thousands)
2021	$	31,048	$	6,531	$	(4,152)
2022	28,334		3,885		(3,167)
2023	24,470		1,534		(1,486)
2024	21,545		584		(812)
2025	19,726		473		(710)
Thereafter	71,156		1,663		(3,018)
Total	$	196,279	$	14,670	$	(13,345)

____________________

(1)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.

F - 33

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

6.    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 December 31, 2020 and 2019:

	December 31, 2020		December 31, 2019
	(in thousands)
Current receivables	$	13,806	$	27,660
Allowance for uncollectible tenant receivables (1)	(1,799)		(1,171)
Current receivables, net	$	12,007	$	26,489

____________________

(1)Refer to Note 2 “Basis of Presentation and Significant Accounting Policies” for discussion of our accounting policies related to the allowance for uncollectible tenant receivables for additional information regarding changes in our allowance for uncollectible tenant receivables.

Deferred Rent Receivables, net

Deferred rent receivables, net consisted of the following as of December 31, 2020 and 2019:

	December 31, 2020		December 31, 2019
	(in thousands)
Deferred rent receivables	$	387,462	$	339,489
Allowance for deferred rent receivables (1)	(804)		(1,552)
Deferred rent receivables, net	$	386,658	$	337,937

____________________

(1)Refer to Note 2 “Basis of Presentation and Significant Accounting Policies” for discussion of our accounting policies related to the allowance for deferred rent receivables for additional information regarding changes in our allowance for deferred rent receivables.

7.    Prepaid Expenses and Other Assets, Net

Prepaid expenses and other assets, net consisted of the following at December 31, 2020 and 2019:

	December 31, 2020		December 31, 2019
	(in thousands)
Furniture, fixtures and other long-lived assets, net	$	43,367	$	35,286
Prepaid expenses	10,193		18,724
Notes receivable, net (1)	—		1,651
Total prepaid expenses and other assets, net	$	53,560	$	55,661

____________________

(1)During the year ended December 31, 2020, the balance of the note receivable was written-off and the note receivable was placed on non-accrual status. We do not recognize interest income on non-accrual financing receivables. As of December 31, 2019, the note receivable was shown net of a valuation allowance of approximately $3.6 million.

F - 34

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

8.    Secured and Unsecured Debt of the Company

In this Note 8, the “Company” refers solely to Kilroy Realty Corporation and not to any of our subsidiaries. The Company itself does not hold any indebtedness. All of our secured and unsecured debt is held directly by the Operating Partnership.

The Company generally guarantees all the Operating Partnership’s unsecured debt obligations including the unsecured revolving credit facility, the unsecured term loan facility and all of the unsecured senior notes. At December 31, 2020 and 2019, the Operating Partnership had $3.7 billion and $3.3 billion, respectively, outstanding in total, including unamortized discounts and deferred financing costs, under these unsecured debt obligations.

In addition, although the remaining $0.3 billion of the Operating Partnership’s debt as of December 31, 2020 and 2019, is secured and non-recourse to the Company, the Company provides limited customary secured debt guarantees for items such as voluntary bankruptcy, fraud, misapplication of payments and environmental liabilities.

Debt Covenants and Restrictions

One of the covenants contained within the unsecured revolving credit facility as discussed further below in Note 9 prohibits the Company from paying dividends during an event of default in excess of an amount which results in distributions to us in an amount sufficient to permit us to pay dividends to our stockholders that we reasonably believe are necessary to (a) maintain our qualification as a REIT for federal and state income tax purposes and (b) avoid the payment of federal or state income or excise tax.

9.    Secured and Unsecured Debt of the Operating Partnership

Secured Debt

The following table sets forth the composition of our secured debt as of December 31, 2020 and 2019:

	Annual Stated Interest Rate (1)	GAAP Effective Rate (1)(2)	Maturity Date	December 31,
Type of Debt				2020		2019
				(in thousands)
Mortgage note payable	3.57%	3.57%	December 2026	$	166,776	$	170,000
Mortgage note payable (3)	4.48%	4.48%	July 2027	87,589		89,502
Total secured debt				$	254,365	$	259,502
Unamortized Deferred Financing Costs				(783)		(909)
Total secured debt, net				$	253,582	$	258,593

____________________

(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)The secured debt and the related properties that secure this 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.

The Operating Partnership’s secured debt was collateralized by operating properties with a combined net book value of approximately $222.0 million as of December 31, 2020.

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.

As of December 31, 2020, all of the Operating Partnership’s secured loans contained restrictions that would require the payment of prepayment penalties for the acceleration of outstanding debt. The mortgage notes payable are secured by deeds of trust on certain of our properties and the assignment of certain rents and leases associated with those properties.

F - 35

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Unsecured Senior Notes - Registered Offerings

In August 2020, the Operating Partnership issued $425.0 million aggregate principal amount of green unsecured senior notes in a registered public offering. The outstanding balance of the unsecured senior notes is included in unsecured debt, net of an initial issuance discount of $2.7 million, on our consolidated balance sheets. The unsecured senior notes, which are scheduled to mature on November 15, 2032, require semi-annual interest payments each May and November based on a stated annual interest rate of 2.500%. The Operating Partnership may redeem the notes at any time prior to August 15, 2032, either in whole or in part, subject to the payment of an early redemption premium prior to a par call option period commencing three months prior to maturity.

In September 2019, the Operating Partnership issued $500.0 million of aggregate principal amount of unsecured senior notes in a registered public offering. The outstanding balance of the unsecured senior notes is included in unsecured debt, net of an initial issuance discount of $0.6 million, on our consolidated balance sheets. The unsecured senior notes, which are scheduled to mature on February 15, 2030, require semi-annual interest payments each February and August based on a stated annual interest rate of 3.050%. The Operating Partnership may redeem the notes at any time prior to February 15, 2030, either in whole or in part, subject to the payment of an early redemption premium prior to a par call option period commencing three months prior to maturity.

Unsecured Senior Notes - Private Placement

In April 2020, the Operating Partnership entered into a Note Purchase Agreement in connection with the issuance and sale of $350.0 million principal amount of the Operating Partnership’s 4.270% Senior Notes due January 31, 2031 (the “Notes due 2031”), pursuant to a private placement. The Notes due 2031 mature on their due date, unless earlier redeemed or prepaid pursuant to the terms of the Note Purchase Agreement. Interest on the Notes is payable semi-annually in arrears on April 18 and October 18 of each year beginning October 18, 2020.

Unsecured Senior Notes - Early Redemption

In December 2018, at our option, we early redeemed the $250.0 million aggregate principal amount of our outstanding 6.625% unsecured senior notes that were scheduled to mature on June 1, 2020. In connection with our early redemption, we incurred a $12.6 million loss on early extinguishment of debt comprised of an $11.8 million premium paid to the note holders at the redemption date and a $0.8 million write-off of the unamortized discount and unamortized deferred financing costs.

Unsecured Senior Notes

The following table summarizes the balance and significant terms of the registered unsecured senior notes issued by the Operating Partnership and outstanding, including the issuances noted above, and including unamortized discounts of $8.3 million and $6.5 million and unamortized deferred financing costs of $21.6 million and $18.7 million as of December 31, 2020 and 2019, respectively:

F - 36

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

					Net Carrying Amount as of December 31,
	Issuance date	Maturity date	Stated coupon rate	Effective interest rate (1)	2020		2019
					(in thousands)
2.500% Unsecured Senior Notes (2)	August 2020	November 2032	2.500%	2.560%	$	425,000	$	—
Unamortized discount and deferred financing costs					(6,332)		—
Net carrying amount					$	418,668	$	—
4.270% Unsecured Senior Notes (3)	April 2020	January 2031	4.270%	4.270%	$	350,000	$	—
Unamortized discount and deferred financing costs					(1,825)		—
Net carrying amount					$	348,175	$	—
3.050% Unsecured Senior Notes (4)	September 2019	February 2030	3.050%	3.064%	$	500,000	$	500,000
Unamortized discount and deferred financing costs					(5,399)		(5,998)
Net carrying amount					$	494,601	$	494,002
4.750% Unsecured Senior Notes (5)	November 2018	December 2028	4.750%	4.800%	$	400,000	$	400,000
Unamortized discount and deferred financing costs					(3,952)		(4,446)
Net carrying amount					$	396,048	$	395,554
4.350% Unsecured Senior Notes (6)	October 2018	October 2026	4.350%	4.350%	$	200,000	$	200,000
Unamortized discount and deferred financing costs					(1,012)		(1,186)
Net carrying amount					$	198,988	$	198,814
4.300% Unsecured Senior Notes (6)	July 2018	July 2026	4.300%	4.300%	$	50,000	$	50,000
Unamortized discount and deferred financing costs					(246)		(290)
Net carrying amount					$	49,754	$	49,710
3.450% Unsecured Senior Notes (7)	December 2017	December 2024	3.450%	3.470%	$	425,000	$	425,000
Unamortized discount and deferred financing costs					(2,321)		(2,907)
Net carrying amount					$	422,679	$	422,093
3.450% Unsecured Senior Notes (8)	February 2017	February 2029	3.450%	3.450%	$	75,000	$	75,000
Unamortized discount and deferred financing costs					(347)		(390)
Net carrying amount					$	74,653	$	74,610
3.350% Unsecured Senior Notes (8)	February 2017	February 2027	3.350%	3.350%	$	175,000	$	175,000
Unamortized discount and deferred financing costs					(709)		(825)
Net carrying amount					$	174,291	$	174,175
4.375% Unsecured Senior Notes (9)	September 2015	October 2025	4.375%	4.444%	$	400,000	$	400,000
Unamortized discount and deferred financing costs					(2,631)		(3,185)
Net carrying amount					$	397,369	$	396,815
4.250% Unsecured Senior Notes (10)	July 2014	August 2029	4.250%	4.350%	$	400,000	$	400,000
Unamortized discount and deferred financing costs					(4,567)		(5,100)
Net carrying amount					$	395,433	$	394,900
3.800% Unsecured Senior Notes (11)	January 2013	January 2023	3.800%	3.800%	$	300,000	$	300,000
Unamortized discount and deferred financing costs					(560)		(834)
Net carrying amount					$	299,440	$	299,166
Total Unsecured Senior Notes, Net					$	3,670,099	$	2,899,839

____________________

(1)Represents the effective interest rate including the amortization of initial issuance discounts, excluding the amortization of deferred financing costs.

(2)Interest on these notes is payable semi-annually in arrears on May 15 and November 15 of each year.

(3)Interest on these notes is payable semi-annually in arrears on April 18 and October 18 of each year.

(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 June 15th and December 15th of each year.

(6)Interest on these notes is payable semi-annually in arrears on April 18th and October 18th of each year.

(7)Interest on these notes is payable semi-annually in arrears on June 15th and December 15th of each year.

(8)Interest on these notes is payable semi-annually in arrears on February 17th and August 17th of each year.

(9)Interest on these notes is payable semi-annually in arrears on April 1st and October 1st of each year.

(10)Interest on these notes is payable semi-annually in arrears on February 15th and August 15th of each year.

(11)Interest on these notes is payable semi-annually in arrears on January 15th and July 15th of each year.

F - 37

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Unsecured Revolving Credit Facility and Term Loan Facility

The following table summarizes the balance and terms of our unsecured revolving credit facility as of December 31, 2020 and 2019:

	December 31, 2020			December 31, 2019
	(in thousands)
Outstanding borrowings	$	—		$	245,000
Remaining borrowing capacity	750,000			505,000
Total borrowing capacity (1)	$	750,000		$	750,000
Interest rate (2)	1.14		%	2.76		%
Facility fee-annual rate (3)	0.200%
Maturity date	July 2022

____________________

(1)We may elect to borrow, subject to bank approval and obtaining commitments for any additional borrowing capacity, up to an additional $600.0 million under an accordion feature under the terms of the unsecured revolving credit facility and unsecured term loan facility.

(2)Our unsecured revolving credit facility interest rate was calculated based on the contractual rate of LIBOR plus 1.000% as of December 31, 2020 and 2019.

(3)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 December 31, 2020 and 2019, $2.1 million and $3.4 million of unamortized deferred financing costs, respectively, which are included in prepaid expenses and other assets, net on our consolidated balance sheets, remained to be amortized through the maturity date of our unsecured revolving credit facility.

The Company intends to borrow under the unsecured revolving credit facility from time to time for general corporate purposes, to finance development and redevelopment expenditures, to fund potential acquisitions and to potentially repay long-term debt and to supplement cash balances given uncertainties and volatility in market conditions.

In August 2020, the Company repaid in full the $150.0 million unsecured term loan facility. The following table summarizes the balance and terms of our unsecured term loan facility as of December 31, 2019, which is included in unsecured debt, net on our consolidated balance sheets:

	December 31, 2019
Outstanding borrowings	$	150,000
Remaining borrowing capacity	—
Total borrowing capacity (1)	$	150,000
Interest rate (2)	2.85		%
Undrawn facility fee-annual rate	0.200%
Maturity date	July 2022

____________________

(1)As of December 31, 2019, $0.7 million of unamortized deferred financing costs 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 the contractual rate of LIBOR plus 1.100% as of December 31, 2019.

F - 38

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Debt Covenants and Restrictions

The unsecured revolving credit facility, the unsecured senior notes, the Series A and B Notes due 2026, Series A and B Notes due 2027 and 2029, and Notes due 2031 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 December 31, 2020 and 2019.

Debt Maturities

The following table summarizes the stated debt maturities and scheduled amortization payments as of December 31, 2020:

Year	(in thousands)
2021	$	5,342
2022	5,554
2023	305,775
2024	431,006
2025	406,246
Thereafter	2,800,442
Total aggregate principal value (1)	$	3,954,365

________________________ 

(1)     Includes gross principal balance of outstanding debt before the effect of the following at December 31, 2020: $22.4 million of unamortized deferred financing costs for the unsecured senior notes and secured debt and $8.3 million of unamortized discounts for the unsecured senior notes.

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 years ended December 31, 2020, 2019 and 2018. The interest expense capitalized was recorded as a cost of development and increased the carrying value of undeveloped land and construction in progress.

	Year Ended December 31,
	2020		2019		2018
	(in thousands)
Gross interest expense	$	150,325	$	129,778	$	117,789
Capitalized interest and deferred financing costs	(79,553)		(81,241)		(68,068)
Interest expense	$	70,772	$	48,537	$	49,721

F - 39

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

10.    Deferred Revenue and Acquisition-Related Intangible Liabilities, net

Deferred revenue and acquisition-related intangible liabilities, net consisted of the following at December 31, 2020 and 2019:

	December 31,
	2020		2019
	(in thousands)
Deferred revenue related to tenant-funded tenant improvements	$	88,645	$	96,271
Other deferred revenue	26,533		19,125
Acquisition-related intangible liabilities, net (1)	13,345		24,092
Total	$	128,523	$139,488

_____________________

(1)See Note 5 “Deferred Leasing Costs and Acquisition-Related Intangible Assets and Liabilities, net” for additional information regarding our acquisition-related intangible liabilities.

Deferred Revenue Related to Tenant-funded Tenant Improvements

During the years ended December 31, 2020, 2019, and 2018, $22.5 million, $19.2 million and $18.4 million, respectively, of deferred revenue related to tenant-funded tenant improvements was amortized and recognized as rental income. The following is the estimated amortization of deferred revenue related to tenant-funded tenant improvements as of December 31, 2020 for the next five years and thereafter:

Year Ending	(in thousands)
2021	$	16,216
2022	15,188
2023	13,367
2024	11,325
2025	8,564
Thereafter	23,985
Total	$	88,645

F - 40

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

11.    Noncontrolling Interests on the Company’s Consolidated Financial Statements

Common Units of the Operating Partnership

The Company owned a 99.0% and 98.1% common general partnership interest in the Operating Partnership as of December 31, 2020 and 2019, respectively. The remaining 1.0% and 1.9% common limited partnership interest as of December 31, 2020 and 2019, respectively, was owned by non-affiliated investors and certain of our executive officers and directors in the form of noncontrolling common units. There were 1,150,574 and 2,023,287 common units outstanding held by these investors, executive officers and directors as of December 31, 2020 and 2019, respectively. The decrease in the common units from December 31, 2019 to December 31, 2020 was attributable to 872,713 common unit redemptions.

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 $65.4 million and $167.7 million as of December 31, 2020 and 2019, respectively. This redemption value does not necessarily represent the amount that would be distributed with respect to each noncontrolling common unit in the event of our termination or liquidation. In the event of our termination or liquidation, it is expected in most cases that each common unit would be entitled to a liquidating distribution equal to the liquidating distribution payable in respect of each share of the Company’s common stock.

Noncontrolling Interest in Consolidated Property Partnerships

In August 2016, the Operating Partnership entered into agreements with Norges Bank Real Estate Management (“NBREM”) whereby NBREM made contributions, through two REIT subsidiaries, for a 44% common equity interest in two existing companies that owned the Company’s 100 First Street and 303 Second Street office properties located in San Francisco, California. The transactions did not meet the criteria to qualify as sales of real estate because the Company continues to effectively control the properties and therefore continued to account for the 100 First Street and 303 Second Street office properties on a consolidated basis in its financial statements. At formation, the Company accounted for the transactions as equity transactions and recognized noncontrolling interests in its consolidated balance sheets.

The noncontrolling interests in 100 First LLC and 303 Second LLC as of December 31, 2020 and 2019 were $191.9 million and $189.6 million, respectively. The remaining amount of noncontrolling interests in consolidated property partnerships represents the third party equity interest in Redwood LLC. This noncontrolling interest was $5.6 million and $5.8 million as of December 31, 2020 and 2019, respectively.

F - 41

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

12.    Noncontrolling Interests on the Operating Partnership’s Consolidated Financial Statements

Consolidated Property Partnerships

In August 2016, the Operating Partnership entered into agreements with NBREM whereby NBREM made contributions, through two REIT subsidiaries, for a 44% common equity interest in two existing companies that owned the Company’s 100 First Street and 303 Second Street office properties located in San Francisco, California. Refer to Note 11 for additional information regarding these consolidated property partnerships.

13.    Stockholders’ Equity of the Company

Common Stock

Increase in Authorized Shares

On May 19, 2020, the Company’s stockholders approved a proposal to amend and restate the Company’s charter to increase the number of authorized shares of common stock that the Company has the authority to issue from 150,000,000 shares to 280,000,000 shares.

Forward Equity Offerings and Settlements

On February 18, 2020, the Company entered into forward equity sale agreements with certain financial institutions acting as forward purchasers in connection with an offering of 5,750,000 shares of common stock at an initial gross offering price of $494.5 million, or $86.00 per share, before underwriting discounts, commissions and offering expenses. The forward purchasers borrowed and sold an aggregate of 5,750,000 shares of common stock in the offering. The Company did not receive any proceeds from the sale of its shares of common stock by the forward purchasers at the time of the offering.

On March 25, 2020, the Company physically settled these forward equity sale agreements. Upon settlement, the Company issued 5,750,000 shares of common stock for net proceeds of $474.9 million and contributed the net proceeds to the Operating Partnership in exchange for an equal number of units in the Operating Partnership.

In August 2018, the Company entered into forward equity sale agreements with certain financial institutions acting as forward purchasers in connection with an offering of 5,000,000 shares of common stock at an initial gross offering price of $360.5 million, or $72.10 per share, before underwriting discounts, commissions and offering expenses. The forward purchasers borrowed and sold an aggregate of 5,000,000 shares of common stock in the offering. The Company did not receive any proceeds from the sale of its shares of common stock by the forward purchasers at the time of the offering.

In July 2019, the Company physically settled these forward equity sale agreements. Upon settlement, the Company issued 5,000,000 shares of common stock for net proceeds of $354.3 million and contributed the net proceeds to the Operating Partnership in exchange for an equal number of units in the Operating Partnership.

At-The-Market Stock Offering Programs

Under our at-the-market stock offering programs, which commenced in December 2014 and June 2018, we may offer and sell shares of our common stock from time to time in “at-the-market” offerings. During the year ended December 31, 2018, the Company completed its existing at-the-market stock offering program (the “2014 At-The-Market Program”) under which we sold an aggregate of $300.0 million in gross sales of shares. In June 2018, the Company commenced a new at-the-market stock offering program (the “2018 At-The-Market Program”) under which we may offer and sell shares of our common stock with an aggregate gross sales price of up to $500.0 million. In connection with the 2018 At-The-Market Program, the Company may also, at its discretion, enter into forward equity sale agreements. The use of forward equity sale agreements allows the Company to lock in a share price on the sale of shares of our common stock at the time an agreement is executed, but defer settling the forward equity sale agreements and receiving the proceeds from the sale of shares until a later date.

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KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

During the year ended December 31, 2019, we executed various 12-month forward equity sale agreements under the 2018 Program with financial institutions acting as forward purchasers to sell 3,147,110 shares of common stock at a weighted average sales price of $80.08 per share before underwriting discounts, commissions and offering expenses. The Company did not receive any proceeds from the sale of its shares of common stock by forward purchasers at the time of sale.

In March 2020, the Company physically settled all forward equity sale agreements entered into in 2019. Upon settlement, the Company issued 3,147,110 shares of common stock for net proceeds of $247.3 million and contributed the net proceeds to the Operating Partnership in exchange for an equal number of units in the Operating Partnership. We did not enter into any forward equity sale agreements under our at-the-market program during the year ended December 31, 2020.

The following table sets forth information regarding settlements of forward equity sale agreements under our at-the-market offering program for the year ended December 31, 2020:

	Year Ended December 31, 2020
	(in millions, except share and per share data)
Shares of common stock settled during the period	3,147,110
Weighted average price per share of common stock	$	80.08
Aggregate gross proceeds	$	252.0
Aggregate net proceeds after selling commissions	$	247.3

Since commencement of the 2018 At-The-Market program through December 31, 2020, we have sold 3,594,576 shares of common stock under the 2018 At-The-Market Program. As of December 31, 2020, we may offer and sell shares of our common stock having an aggregate gross sales price up to approximately $214.2 million under the 2018 At-The-Market Program.

The Company did not complete any direct sales of common stock under the program during the years ended December 31, 2020 and 2019. During the year ended December 31, 2018, we sold 447,466 shares of common stock under the 2018 At-The-Market Program and 1,369,729 shares of common stock under the 2014 At-The-Market Program. The following table sets forth information regarding direct sales of our common stock under our at-the-market offering programs for the year ended December 31, 2018:

	Year Ended December 31, 2018
	(in millions, except share and per share data)
Shares of common stock sold during the period		1,817,195
Weighted average price per share of common stock		$	73.64
Aggregate gross proceeds		$	133.8
Aggregate net proceeds after selling commissions		$	132.1

The proceeds from sales were used to fund development expenditures and general corporate purpose. 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 the 2018 At-The-Market Program.

Common Stock Repurchases

As of December 31, 2020, 4,935,826 shares remained eligible for repurchase under a share repurchase program approved by the Company’s board of directors in 2016. The Company did not repurchase shares of common stock under this program during the three years ended December 31, 2020, 2019 and 2018.

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KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Accrued Dividends and Distributions

The following tables summarize accrued dividends and distributions for the noted outstanding shares of common stock and noncontrolling units as of December 31, 2020 and 2019:

	December 31,
	2020		2019
	(in thousands)
Dividends and Distributions payable to:
Common stockholders	$	58,018	$	51,418
Noncontrolling common unitholders of the Operating Partnership	575		981
RSU holders (1)	838		820
Total accrued dividends and distribution to common stockholders and noncontrolling unitholders	$	59,431	$	53,219

_____________________

(1)The amount includes the value of the dividend equivalents that will be paid with additional RSUs (see Note 15 “Share-Based and Other Compensation” for additional information).

	December 31,
	2020	2019
Outstanding Shares and Units:
Common stock (1)	116,035,827	106,016,287
Noncontrolling common units	1,150,574	2,023,287
RSUs (2)	1,638,026	1,651,905

_____________________

(1)The amount includes nonvested shares.

(2)The amount includes nonvested RSUs. Does not include 873,709 and 932,675 market measure-based RSUs because not all the necessary performance conditions have been met as of December 31, 2020 and 2019, respectively. Refer to Note 15 “Share-Based and Other Compensation” for additional information.

14.    Partners’ Capital of the Operating Partnership

Common Units

Issuance of Common Units

In March 2020, the Company physically settled the forward equity sale agreements entered into in February 2020 (see Note 13 “Stockholders’ Equity of the Company”). Upon settlement, the Company issued 5,750,000 shares of common stock for net proceeds of $474.9 million and contributed the net proceeds to the Operating Partnership in exchange for 5,750,000 common units.

In July 2019, the Company physically settled the forward equity sale agreements entered into in August 2018 (see Note 13 “Stockholders’ Equity of the Company”). Upon settlement, the Company issued 5,000,000 shares of common stock for net proceeds of $354.3 million and contributed the net proceeds to the Operating Partnership in exchange for 5,000,000 common units.

At-The-Market Stock Offering Program

In March 2020, the Company physically settled all forward equity sale agreements entered into in 2019. Upon settlement, the Company issued 3,147,110 shares of common stock for net proceeds of $247.3 million and contributed the net proceeds to the Operating Partnership in exchange for an equal number of units in the Operating Partnership. The Company did not issue any shares of common stock under its at-the-market programs and did not contribute any shares of common stock to the Operating Partnership during the year ended December 31, 2019. During the year ended December 31, 2018, the Company utilized its at-the-market stock offering programs to issue shares of common stock. See Note 13 “Stockholders’ Equity of the Company” for additional information. The net

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KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

offering proceeds contributed by the Company to the Operating Partnership in exchange for common units for the year ended December 31, 2020 and 2018 are as follows:

	Year Ended December 31,
	2020		2018
	(in millions except share and per share data)
Shares of common stock contributed by the Company	3,147,110		1,817,195
Common units exchanged for shares of common stock by the Company	3,147,110		1,817,195
Aggregate gross proceeds	$	252.0	$	133.8
Aggregate net proceeds after selling commissions	$	247.3	$	132.1

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:

	December 31, 2020		December 31, 2019
Company owned common units in the Operating Partnership	116,035,827		106,016,287
Company owned general partnership interest	99.0	%	98.1	%
Noncontrolling common units of the Operating Partnership	1,150,574		2,023,287
Ownership interest of noncontrolling interest	1.0	%	1.9	%

For a further discussion of the noncontrolling common units during the years ended December 31, 2020 and 2019, refer to Note 11 “Noncontrolling Interests on the Company’s Consolidated Financial Statements.”

Accrued Distributions

The following tables summarize accrued distributions for the noted common units as of December 31, 2020 and 2019:

	December 31, 2020		December 31, 2019
	(in thousands)
Distributions payable to:
General partner	$	58,018	$	51,418
Common limited partners	575		981
RSU holders (1)	838		820
Total accrued distributions to common unitholders	$	59,431	$	53,219

_____________________

(1)The amount includes the value of the dividend equivalents that will be paid with additional RSUs (see Note 15 “Share-Based and Other Compensation” for additional information).

	December 31, 2020	December 31, 2019
Outstanding Units:
Common units held by the general partner	116,035,827	106,016,287
Common units held by the limited partners	1,150,574	2,023,287
RSUs (1)	1,638,026	1,651,905

_____________________

(1)Does not include 873,709 and 932,675 market measure-based RSUs because not all the necessary performance conditions have been met as of December 31, 2020 and 2019, respectively. Refer to Note 15 “Share-Based and Other Compensation” for additional information.

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KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

15.    Share-Based and Other Compensation

Stockholder Approved Share-Based Incentive Compensation Plan

As of December 31, 2020, we maintained one share-based incentive compensation plan, the Kilroy Realty 2006 Incentive Award Plan, as amended (the “2006 Plan”). The Company has a currently effective registration statement registering 10.7 million shares of our common stock for possible issuance under our 2006 Incentive Award Plan. As of December 31, 2020, approximately 1.5 million 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) for which the performance period has been completed and (ii) at maximum levels for the other performance and market conditions (as defined below) for awards still in a performance period.

The Executive Compensation Committee (the “Compensation Committee”) of the Company’s Board of Directors may grant the following share-based awards to eligible individuals, as provided under the 2006 Plan: incentive stock options, nonqualified stock options, restricted stock (nonvested shares), stock appreciation rights, performance shares, performance stock units, dividend equivalents, stock payments, deferred stock, restricted stock units (“RSUs”), profit interest units, performance bonus awards, performance-based awards and other incentive awards. For each award granted under our share-based incentive compensation programs, the Operating Partnership simultaneously issues to the Company a number of common units equal to the number of shares of common stock ultimately paid by the Company in respect of such awards.

2020, 2019 and 2018 Share-Based Compensation Grants

In January 2020, the Executive Compensation Committee of the Company’s Board of Directors awarded 263,626 restricted stock units (“RSUs”) to certain officers of the Company under the 2006 Plan, which included 154,267 RSUs (at the target level of performance) that are subject to market and/or performance-based vesting requirements (the “2020 Performance-Based RSUs”) and 109,359 RSUs that are subject to time-based vesting requirements (the “2020 Time-Based RSUs”). During the year ended December 31, 2020, 5,148 2020 Time-Based RSUs, 12,263 2020 Performance-Based RSUs and 6,441 time-based and performance-based RSUs that were granted in prior years were forfeited.

In February 2019, the Executive Compensation Committee of the Company’s Board of Directors awarded 288,378 RSUs to certain officers of the Company under the 2006 Plan, which included 143,396 RSUs (at the target level of performance) that are subject to market and/or performance-based vesting requirements (the “2019 Performance-Based RSUs”) and 144,982 RSUs that are subject to time-based vesting requirements (the “2019 Time-Based RSUs”). During the year ended December 31, 2019, 10,733 2019 Time-Based RSUs, 24,353 2019 Performance-Based RSUs and 98,844 time vest and performance RSUs that were granted in prior years were forfeited.

In connection with entering into an amended employment agreement (the “Amended Employment Agreement”), on December 27, 2018, the Compensation Committee of the Company’s Board of Directors awarded John Kilroy, the Chairman of the Board of Directors and Chief Executive Officer of the Company and the Operating Partnership, 483,871 RSUs, providing an additional retention incentive during the term of the agreement and enticing Mr. Kilroy to delay his retirement. Of these RSUs awarded, 266,130 RSUs (at the target level of performance) are subject to market-based vesting requirements and 217,741 RSUs are subject to time-based vesting requirements. In addition to Mr. Kilroy’s award, the Compensation Committee of the Company’s Board of Directors awarded 161,290 RSUs to certain members of management. Of these RSUs awarded, 80,647 RSUs (at the target level of performance) are subject to market-based vesting requirements (together totaling 346,777 target RSUs with Mr. Kilroy’s award, the “December 2018 Market-Based RSUs”) and 80,643 RSUs are subject to time-based vesting requirements (together totaling 298,384 RSUs with Mr. Kilroy’s award, the “December 2018 Time-Based RSUs”).

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KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

In January and February 2018, the Executive Compensation Committee of the Company’s Board of Directors awarded 282,038 RSUs to certain officers of the Company under the 2006 Plan, which included 158,205 RSUs (at the target level of performance) that are subject to market and/or performance-based vesting requirements (the “2018 Performance-Based RSUs”) and 123,833 RSUs that are subject to time-based vesting requirements (the “2018 Time-Based RSUs”). Additionally, during 2018, 14,999 RSUs were granted to the board of directors and certain members of management subject to time vesting requirements.

    December 2018 Market-Based RSU Grant

Between 0% and 200% of the total 346,777 target number of December 2018 Market-Based RSUs will be eligible to vest based on the Company’s relative total shareholder return (“TSR”) versus a comparative group of companies that consist of companies in the SNL US REIT Office Index over the performance period. An initial number of RSUs (the “Initial Number of RSUs”) will be determined at the end of 2021 based on a three year performance period (consisting of calendar years 2019 through 2021). Once the Initial Number of RSUs is determined, 75% of the Initial Number of RSUs will be scheduled to vest on January 5, 2022. The remaining 25% of the Initial Number of RSUs will be scheduled to vest on January 5, 2023, subject to adjustment based on the Company’s relative TSR for the entire four-year performance period (2019 through 2022). The December 2018 Market-Based RSUs are also subject to service vesting requirements through the scheduled vest dates.

Each December 2018 Market-Based RSU represents the right to receive one share of our common stock in the future, subject to, and as modified by, the Company’s level of achievement of the applicable market conditions. The December 27, 2018 grant date fair value of the December 2018 Market-Based RSUs was $23.8 million. The fair value was calculated using a Monte Carlo simulation pricing model based on the assumptions in the table below. For the years ended December 31, 2020, 2019 and 2018, we recorded compensation expense based upon the $68.66 grant date fair value per share. Compensation expense for the December 2018 Market-Based RSUs is recognized using a graded vesting approach, where 75% of the fair value will be recognized on a straight-line basis over the three-year initial performance period through the end of 2021, and the remaining 25% of the fair value will be recognized on a straight-line basis over the four-year final performance period through the end of 2022. The following table summarizes the assumptions utilized in the Monte Carlo simulation pricing models:

	December 2018 Market-Based RSU Award Fair Value Assumptions
Valuation date	December 27, 2018
Fair value per share on valuation date	$68.66
Expected share price volatility	23.0%
Risk-free interest rate	2.4%

The computation of expected volatility was based on a blend of the historical volatility of our shares of common stock over a period of twice the performance period and implied volatility data based on the observed pricing of six month publicly-traded options on shares of our common stock. The risk-free interest rate was based on the yield curve on zero-coupon U.S. Treasury STRIP securities in effect at December 27, 2018.

    2020, 2019 and 2018 Annual Performance-Based RSU Grants

The 2020 Performance-Based RSUs are scheduled to vest at the end of a three year period (consisting of calendar years 2020-2022). A target number of 2020 Performance-Based RSUs were awarded, and the final number of 2020 Performance-Based RSUs that vest (which may be more or less than the target number) will be based upon (1) the achievement of pre-set FFO per share goals for the year ending December 31, 2020 that applies to 100% of the Performance-Based RSUs awarded (the “2020 FFO Performance Condition”) and (2) a performance measure that applies to 50% of the award based upon a measure of the Company’s average debt to EBITDA ratio for the three year performance period (the “2020 Debt to EBITDA Ratio Performance Condition”) and a market measure that applies to the other 50% of the award based upon the relative ranking of the Company’s total stockholder return for the three year performance period compared to the total stockholder returns of an established comparison group of companies over the same period (the “2020 Market Condition”). The 2020 Performance-Based RSUs are also subject to a three year service vesting provision (the “service vesting condition”) and are scheduled to cliff vest on the date the final vesting percentage is determined following the end of the three year performance period under the

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KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

awards. The 2020 FFO Performance Condition was achieved at 100% of target for all participants. The number of 2020 Performance-Based RSUs ultimately earned could fluctuate from the target number of 2020 Performance-Based RSUs granted based upon the levels of achievement for the 2020 Debt to EBITDA Ratio Performance Condition, the 2020 Market Condition, and the extent to which the service vesting condition is satisfied. The estimate of the number of 2020 Performance-Based RSUs earned is evaluated quarterly during the performance period based on our estimate for each of the performance conditions measured against the applicable goals. Compensation expense for the 2020 Performance-Based RSU grant is recognized on a straight-line basis over the requisite service period for each participant, which is generally the three year service period.

The 2019 Performance-Based RSUs are scheduled to vest at the end of a three year period (consisting of calendar years 2019-2021). A target number of 2019 Performance-Based RSUs were awarded, and the final number of 2019 Performance-Based RSUs that vest (which may be more or less than the target number) will be based upon (1) the achievement of pre-set FFO per share goals for the year ending December 31, 2019 that applies to 100% of the Performance-Based RSUs awarded (the “2019 FFO Performance Condition”) and (2) a performance measure that applies to 50% of the award based upon a measure of the Company’s average debt to EBITDA ratio for the three year performance period (the “2019 Debt to EBITDA Ratio Performance Condition”) and a market measure that applies to the other 50% of the award based upon the relative ranking of the Company’s total stockholder return for the three year performance period compared to the total stockholder returns of an established comparison group of companies over the same period (the “2019 Market Condition”). The 2019 Performance-Based RSUs are also subject to a three year service vesting provision (the “service vesting condition”) and are scheduled to cliff vest on the date the final vesting percentage is determined following the end of the three year performance period under the awards. The 2019 FFO Performance Condition was achieved at 175% of target for one participant and 150% of target for all other participants. The number of 2019 Performance-Based RSUs ultimately earned could fluctuate from the target number of 2019 Performance-Based RSUs granted based upon the levels of achievement for the 2019 Debt to EBITDA Ratio Performance Condition, the 2019 Market Condition, and the extent to which the service vesting condition is satisfied. The estimate of the number of 2019 Performance-Based RSUs earned is evaluated quarterly during the performance period based on our estimate for each of the performance conditions measured against the applicable goals. Compensation expense for the 2019 Performance-Based RSU grant is recognized on a straight-line basis over the requisite service period for each participant, which is generally the three year service period.

The 2018 Performance-Based RSUs are scheduled to vest at the end of a three year period (consisting of calendar years 2018-2020). A target number of 2018 Performance-Based RSUs were awarded, and the final number of 2018 Performance-Based RSUs that vest (which may be more or less than the target number) will be based upon (1) the achievement of pre-set FFO per share goals for the year ending December 31, 2018 that applies to 100% of the Performance-Based RSUs awarded (the “2018 FFO Performance Condition”) and (2) a performance measure that applies to 50% of the award based upon a measure of the Company’s average debt to EBITDA ratio for the three year performance period (the “2018 Debt to EBITDA Ratio Performance Condition” and together with the 2018 FFO Performance Condition, the “2018 Performance Conditions”) and a market measure that applies to the other 50% of the award based upon the relative ranking of the Company’s TSR for the three year performance period compared to the TSR of an established comparison group of companies over the same period (the “2018 Market Condition”). Based on the combined results of the 2018 Performance Conditions and the 2018 Market Condition, the 2018 Performance-Based RSUs achieved a weighted average of 219% for one participant and 175% for the others of their target level of performance.

As of December 31, 2020, the estimated number of RSUs earned for the 2020 and 2019 Performance-Based RSUs and the actual number of RSUs earned for the 2018 Performance-Based RSUs was as follows:

	2020 Performance-Based RSUs	2019 Performance-Based RSUs	2018 Performance-Based RSUs
Service vesting period	January 31, 2020 - January, 2023	February 1, 2019 - January, 2022	February 14, 2018 - January, 2021
Target RSUs granted	154,267	143,396	158,205
Estimated RSUs earned (1)	142,004	220,151	229,748
Date of valuation	January 31, 2020	February 1, 2019	February 14, 2018

_____________________

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KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

(1)Estimated RSUs earned for the 2020 Performance-Based RSUs are based on the actual achievement of the 2020 FFO Performance Condition and for the 2020 Debt to EBITDA Ratio Performance Condition, assumes 100% of the target level of achievement for all participants, and target level of achievement of the 2020 Market Condition. Estimated RSUs earned for the 2019 Performance-Based RSUs are based on the actual achievement of the 2019 FFO Performance Condition and assume target level achievement of the 2019 Market Condition and maximum level of achievement of the 2019 Debt to EBITDA Ratio Performance Condition. The 2018 Performance-Based RSUs earned are based on actual performance of the 2018 Performance Conditions and the 2018 Market Condition.

Each Performance-Based RSU represents the right to receive one share of our common stock in the future, subject to, and as modified by, the Company’s level of achievement of the applicable performance and market conditions. The fair values of the 2020 Performance-Based RSUs, 2019 Performance-Based RSUs and 2018 Performance-Based RSUs were $12.9 million at January 31, 2020, $10.2 million at February 1, 2019, and $10.8 million at February 14, 2018, respectively. The fair values for the awards with market conditions were calculated using a Monte Carlo simulation pricing model based on the assumptions in the table below. The determination of the fair value of the 2020, 2019 and 2018 Performance-Based RSUs takes into consideration the likelihood of achievement of the 2020, 2019 and 2018 Performance Conditions and the 2020, 2019 and 2018 Market Conditions, respectively, as discussed above. The following table summarizes the assumptions utilized in the Monte Carlo simulation pricing models:

	2020 Award Fair Value Assumptions	2019 Award Fair Value Assumptions	2018 Award Fair Value Assumptions
Valuation date	January 31, 2020	February 1, 2019	February 14, 2018
Fair value per share on valuation date	$84.54	$72.57	$70.08
Expected share price volatility	17.0%	19.0%	20.0%
Risk-free interest rate	1.35%	2.48%	2.37%

The computation of expected volatility was based on a blend of the historical volatility of our shares of common stock over a period of twice the remaining performance period as of the grant date and implied volatility data based on the observed pricing of six month publicly-traded options on shares of our common stock. The risk-free interest rate was based on the yield curve on zero-coupon U.S. Treasury STRIP securities in effect at January 31, 2020, February 1, 2019, and February 14, 2018.

Compensation expense for the Performance-Based RSUs is recognized on a straight-line basis over the requisite service period for each participant, which is generally the three-year service period. As of December 31, 2020, the number of 2020 Performance-Based RSUs estimated to be earned based on the Company’s estimate of the performance conditions measured against the applicable goals was 142,004, and the compensation cost recorded to date for this program was based on that estimate. For the portion of the 2020 Performance-Based RSUs subject to the 2020 Market Condition, for the year ended December 31, 2020, we recorded compensation expense based upon the $84.54 fair value per share at January 31, 2020. Compensation expense will be variable for the portion of the 2020 Performance-Based RSUs subject to the 2020 Debt to EBITDA Ratio Performance Condition, based upon the outcome of that condition. As of December 31, 2020, the number of 2019 Performance-Based RSUs estimated to be earned based on the Company’s estimate of the performance conditions measured against the applicable goals was 220,151, and the compensation cost recorded to date for this program was based on that estimate. For the portion of the 2019 Performance-Based RSUs subject to the 2019 Market Condition, for the years ended December 31, 2020 and 2019, we recorded compensation expense based upon the $72.57 fair value per share at February 1, 2019. Compensation expense will be variable for the portion of the 2019 Performance-Based RSUs subject to the 2019 Debt to EBITDA Performance Condition, based upon the outcome of that condition. For the years ended December 31, 2020, 2019 and 2018, we recorded compensation expense for the portion of the 2018 Performance-Based RSUs subject to the 2018 Market Condition based upon the $70.08 fair value per share at February 14, 2018 and for the portion of the 2018 Performance-Based RSUs subject to the 2018 Debt to EBITDA Ratio Performance Condition, based on the stock price at date of grant multiplied by the number of RSUs estimated to be earned at December 31 of each year. As of December 31, 2020, net of forfeitures, 229,748 RSUs were estimated to be earned.

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KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Annual 2020, 2019 and 2018 and December 2018 Time-Based RSU Grants

The annual 2020, 2019 and 2018 Time-Based RSUs are scheduled to vest in equal installments over the periods listed below. The 2020 Time-Based RSUs are scheduled to vest in three equal annual installments beginning on January 5, 2021 through January 5, 2023. The 2019 Time-Based RSUs are scheduled to vest in three equal annual installments beginning on January 5, 2020 through January 5, 2022. The December 2018 Time-Based RSUs are scheduled to vest 50% on January 5, 2022 and 50% on January 5, 2023. The 2018 Time-Based RSUs are scheduled to vest in three equal annual installments beginning on January 5, 2019 through January 5, 2021. Compensation expense for the December 2018 and annual 2020, 2019 and 2018 Time-Based RSUs is recognized on a straight-line basis over the requisite service period, which is generally the explicit service period. However, for one participant there is a shorter service period for their December 2018 Time-Based RSUs. Each Time-Based RSU represents the right to receive one share of our common stock in the future, subject to continued employment through the applicable vesting date, unless accelerated upon separation of employment. During the year ended December 31, 2020, the vesting of 54,735 Time-Based RSUs was accelerated due to separation of employment. The total fair value of the Time-Based RSUs is based on the Company's closing share price on the NYSE on the respective fair valuation dates as detailed in the table below:

	2020 Time-Based RSU Grant		2019 Time-Based RSU Grant		December 2018 Time-Based RSU Grant		2018 Time-Based RSU Grant (1)
Service vesting period	January 31, 2020 - January 5, 2023		February 1, 2019 - January 5, 2022		December 27, 2018 - January 5, 2023		January & February 2018 - January 5, 2021
Fair value on valuation date (in millions)	$	9.0	$	10.1	$	18.5	$	8.4
Fair value per share	$	82.57	$	69.89	$	62.00	$	70.37
Date of fair valuation	January 31, 2020		February 1, 2019		December 27, 2018		January & February 2018

____________________

(1)The 2018 Time-Based RSUs consist of 56,015 RSUs granted on January 29, 2018 at a fair value per share of $70.37 and 67,818 RSUs granted on February 14, 2018 at a fair value per share of $66.46.

Summary of Performance and Market-Measure Based RSUs

A summary of our performance and market-measure based RSU activity from January 1, 2020 through December 31, 2020 is presented below:

	Nonvested RSUs			Vested RSUs	Total RSUs
	Amount	Weighted-Average Fair Value Per Share
Outstanding at January 1, 2020	932,675	$	71.04	36,679	969,354
Granted	154,267	85.08		38,313	192,580
Vested	(230,334)	74.71		230,334	—
Settled (1)	—	—		(259,954)	(259,954)
Issuance of dividend equivalents (2)	29,561	62.21		1,407	30,968
Forfeited	(12,460)	84.54		(4)	(12,464)
Outstanding as of December 31, 2020 (3)	873,709	$	72.06	46,775	920,484

____________________

(1)Represents vested RSUs that were settled in shares of the Company’s common stock. Total shares settled include 125,928 shares that were tendered in accordance with the terms of the 2006 Plan to satisfy minimum statutory tax withholding requirements related to the RSUs settled. We accept the return of RSUs at the current quoted closing share price of the Company’s common stock to satisfy tax obligations.

(2)Represents the issuance of dividend equivalents earned on the underlying RSUs. The dividend equivalents vest based on terms specified under the related RSU award agreement.

(3)Outstanding RSUs as of December 31, 2020 represent the actual achievement of the FFO performance conditions and assumes target levels for the market and other performance conditions. The number of restricted stock units ultimately earned is subject to change based upon actual performance over the three-year vesting period. Dividend equivalents earned will vest along with the underlying award and are also subject to changes based on the number of RSUs ultimately earned for each underlying award.

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KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

A summary of our performance and market-measure based RSU activity for the years ended December 31, 2020, 2019 and 2018 is presented below:

	RSUs Granted			RSUs Vested
Years ended December 31,	Non-Vested RSUs Granted (1)	Weighted-Average Fair Value Per Share		Vested RSUs	Total Vest-Date Fair Value (in thousands)
2020	154,267	$	85.08	(270,054)	$	19,471
2019	231,191	71.12		(265,737)	18,703
2018	601,012	68.51		(265,918)	18,906

____________________

(1)Non-vested RSUs granted are based on the actual achievement of the FFO performance conditions and assumes target level achievement for the market and other performance conditions.

Summary of Time-Based RSUs

A summary of our time-based RSU activity from January 1, 2020 through December 31, 2020 is presented below:

	Nonvested RSUs			Vested RSUs	Total RSUs
	Amount	Weighted Average Fair Value Per Share
Outstanding at January 1, 2020	543,848	$	66.66	1,071,378	1,615,226
Granted	120,769	79.74		—	120,769
Vested	(173,796)	70.83		173,796	—
Settled (1)				(181,462)	(181,462)
Issuance of dividend equivalents (2)	15,523	61.80		34,812	50,335
Forfeited	(11,979)	77.58		—	(11,979)
Canceled (3)				(1,638)	(1,638)
Outstanding as of December 31, 2020	494,365	$	67.97	1,096,886	1,591,251

____________________

(1)Represents vested RSUs that were settled in shares of the Company’s common stock. Total shares settled include 67,316 shares that were tendered in accordance with the terms of the 2006 Plan to satisfy minimum statutory tax withholding requirements related to the RSUs settled. We accept the return of RSUs at the current quoted closing share price of the Company’s common stock to satisfy tax obligations.

(2)Represents the issuance of dividend equivalents earned on the underlying RSUs. The dividend equivalents vest based on terms specified under the related RSU award agreement.

(3)For shares vested but not yet settled, we accept the return of RSUs at the current quoted closing share price of the Company’s common stock to satisfy minimum statutory tax-withholding requirements related to either the settlement or vesting of RSUs in accordance with the terms of the 2006 Plan.

A summary of our time-based RSU activity for the years ended December 31, 2020, 2019 and 2018 is presented below:

	RSUs Granted			RSUs Vested
Year ended December 31,	Non-Vested RSUs Issued	Weighted-Average Grant Date Fair Value Per Share		Vested RSUs	Total Vest-Date Fair Value (1) (in thousands)
2020	120,769	$	79.74	(208,608)	$	15,066
2019	153,005	70.31		(182,219)	12,227
2018	437,216	64.21		(214,131)	14,768

____________________

(1)    Total fair value of RSUs vested was calculated based on the quoted closing share price of the Company’s common stock on the NYSE on the day of vesting. Excludes the issuance of dividend equivalents earned on the underlying RSUs. The dividend equivalents vest based on terms specified under the related RSU award agreement.

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KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Summary of Nonvested Restricted Stock

We did not have any nonvested restricted stock at January 1, 2020 and 2019 or December 31, 2020 and 2019. A summary of our nonvested and vested restricted stock activity for the year ended December 31, 2018 is presented below:

	Shares Granted		Shares Vested
Years ended December 31,	Nonvested Shares Issued	Weighted-Average Grant Date Fair Value Per Share	Vested Shares	Total Fair Value at Vest Date (1) (in thousands)
2018	—	—	(22,884)	1,652

_______________________

(1)    Total fair value of shares vested was calculated based on the quoted closing share price of the Company’s common stock on the NYSE on the date of vesting.

Share-Based Compensation Cost Recorded During the Period

Share-based compensation costs for the year ended December 31, 2020 include $4.5 million of accelerated share-based compensation costs related to severance packages, including for the departure of an executive officer. The total compensation cost for all share-based compensation programs was $37.6 million, $32.8 million and $35.9 million for the years ended December 31, 2020, 2019 and 2018, respectively. Of the total share-based compensation costs, $7.4 million, $5.8 million and $8.0 million was capitalized as part of real estate assets and for 2018, deferred leasing costs, for the years ended December 31, 2020, 2019 and 2018, respectively. As of December 31, 2020, there was approximately $35.1 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 1.4 years. The remaining compensation cost related to these nonvested incentive awards had been recognized in periods prior to December 31, 2020. The $35.1 million of unrecognized compensation costs does not reflect the future compensation cost related to share-based awards that were granted subsequent to December 31, 2020.

Severance Compensation

For the year ended December 31, 2020, compensation costs included in general and administrative expenses on our consolidated statements of operations include $14.1 million of cash severance costs related to the departure of an executive officer, in addition to the accelerated share-based compensation costs noted in the paragraph above.

Other Compensation

On December 27, 2018, the Executive Compensation Committee of the Company’s Board approved, and the Company and the Operating Partnership entered into the Amended Employment Agreement with John Kilroy, which amends and supersedes the existing employment agreement dated January 1, 2012. Except as noted below, the Amended Employment Agreement continues Mr. Kilroy’s employment on terms substantially similar to those of the existing employment agreement, with a new term scheduled to continue through December 31, 2023. The Amended Employment Agreement includes a cash retirement benefit of $13.2 million, or $16.2 million for a retirement at or after attaining age 73, with at least twelve months’ advance notice or at or after the end of the term of the agreement. For the year ended December 31, 2018, the Company recognized $12.1 million of compensation expense in general and administrative expenses on the consolidated statement of operations, representing the present value of the potential cash retirement benefit amount that was earned based on prior service. For the years ended December 31, 2020 and 2019, the Company recognized $1.5 million of compensation expense in general and administrative expenses on the consolidated statement of operations related to the Amended Employment Agreement.

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KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

16.    Employee Benefit Plans

401(k) Plan

We have a retirement savings plan designed to qualify under Section 401(k) of the Code (the “401(k) Plan”). Our employees are eligible to participate in the 401(k) Plan on the first day of the month after three months of service. The 401(k) Plan allows eligible employees (“401(k) Participants”) to defer up to 60% of their eligible compensation on a pre-tax basis, subject to certain maximum amounts allowed by the Code. The 401(k) Plan provides for a matching contribution by the Company in an amount equal to 50 cents of each one dollar of participant contributions up to a maximum of 10% of the 401(k) Participant’s annual salary. 401(k) Participants vest immediately in the amounts contributed by us. For each of the years ended December 31, 2020, 2019, and 2018, we contributed $1.6 million, $1.6 million and $1.5 million, respectively, to the 401(k) Plan.

Deferred Compensation Plan

In 2007, we adopted the Deferred Compensation Plan, under which directors and certain management employees may defer receipt of their compensation, including up to 70% of their salaries and up to 100% of their director fees and bonuses, as applicable. In addition, employee participants will receive mandatory Company contributions to their Deferred Compensation Plan accounts equal to 10% of their gross monthly salaries, without regard to whether such employees elect to defer salary or bonus compensation under the Deferred Compensation Plan. Our Board may, but has no obligation to, approve additional discretionary contributions by the Company to Participant accounts. We hold the Deferred Compensation Plan assets in a limited rabbi trust, which is subject to the claims of our creditors in the event of bankruptcy or insolvency.

See Note 19 “Fair Value Measurements and Disclosures” for further discussion of our Deferred Compensation Plan assets as of December 31, 2020 and 2019. Our liability of $27.4 million and $27.0 million under the Deferred Compensation Plan was fully funded as of December 31, 2020 and 2019, respectively.

17.    Rental Income and Future Minimum Rent

Our rental income is primarily comprised of payments defined under leases and are either subject to scheduled fixed increases or adjustments in rent based on the Consumer Price Index. Additionally, rental income includes variable payments for tenant reimbursements of property-related expenses and payments based on a percentage of tenant’s sales.

The table below sets forth the allocation of rental income between fixed and variable payments and net collectability reversals or recoveries for the years ended December 31, 2020 and 2019:

	Year Ended December 31,
	2020		2019
Fixed lease payments	$	786,860	$	708,362
Variable lease payments	124,443		115,915
Net collectability (reversals) recoveries (1)	(18,997)		2,195
Total rental income	$	892,306	$	826,472

____________________

(1)Represents adjustments to rental income related to our assessment of the collectability of amounts due under leases with our tenants. For the year ended December 31, 2020, includes $18.4 million of write-offs related to the cumulative impact of transitioning certain tenants to a cash basis of reporting primarily as a result of the COVID-19 pandemic. Also includes a $0.6 million net increase to the allowance for doubtful accounts, which includes the impact of $2.2 million of reversals to the allowance for doubtful account for tenants that had an allowance at January 1, 2020 and were subsequently transitioned to a cash basis of reporting during 2020. These reversals are included in the $18.4 million of write-offs above.

We have operating leases with tenants that expire at various dates through 2044 and are either subject to scheduled fixed increases or adjustments in rent based on the Consumer Price Index. Generally, the leases grant tenants renewal options. Leases also provide for additional rents based on certain operating expenses. Future

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KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

contractual minimum rent under operating leases, which includes amounts contractually due from leases that are on a cash basis of reporting due to creditworthiness considerations, as of December 31, 2020 for future periods is summarized as follows:

Year Ending	(in thousands)
2021	$	731,169
2022	804,488
2023	788,214
2024	750,051
2025	719,274
Thereafter	3,455,201
Total (1)	$	7,248,397

____________________

(1)Excludes residential leases and leases with a term of one year or less.

18.    Commitments and Contingencies

General

As of December 31, 2020, we had commitments of approximately $614.9 million, excluding our ground lease commitments, for contracts and executed leases directly related to our operating and development properties.

Ground Leases

The following table summarizes our properties that are held subject to long-term noncancellable ground lease obligations and the respective contractual expiration dates:

Property	Contractual Expiration Date (1)
601 108th Ave NE, Bellevue, WA	November 2093
701, 801 and 837 N. 34th Street, Seattle, WA (2)	December 2041
1701 Page Mill Road and 3150 Porter Drive, Palo Alto, CA	December 2067
Kilroy Airport Center Phases I, II, and III, Long Beach, CA	July 2084
3243 S. La Cienega Boulevard, Los Angeles, CA (3)	October 2106

____________________

(1)    Reflects the contractual expiration date prior to the impact of any extension or purchase options held by the Company.

(2)    The Company has three 10-year and one 45-year extension options for this ground lease, which if exercised would extend the expiration date to December 2116. These extension options are not assumed to be exercised in our calculation of the present value of the future minimum lease payments for this lease.

(3)    We entered into this ground lease in connection with an operating property acquisition in 2019. Refer to Note 3 “Acquisitions” for additional information.

To determine the discount rates used to calculate the present value of the minimum future lease payments for our ground leases, we used a hypothetical curve derived from unsecured corporate borrowing rates over the lease term. The weighted average discount rate used to determine the present value of our minimum lease payments was 5.11%. As of December 31, 2020, the weighted average remaining lease term of our ground leases is 54 years. For the years ended December 31, 2020 and 2019, variable lease costs totaling $3.0 million and $2.9 million, respectively, were recorded to ground leases expense on our consolidated statements of operations.

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KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The minimum commitment under our ground leases as of December 31, 2020 for future periods is as follows:

Year Ending	(in thousands)
2021	$	5,641
2022	5,642
2023	5,662
2024	5,662
2025	5,662
Thereafter	280,723
Total undiscounted cash flows (1)(2)(3)(4)(5)(6)	$	308,992
Present value discount	(211,214)
Ground lease liabilities	$	97,778

________________________

(1)Excludes contingent future rent payments based on gross income or adjusted gross income and reflects the minimum ground lease obligations before the impact of ground lease extension options.

(2)    One of our ground lease obligations is subject to a fair market value adjustment every five years; however, the lease includes ground rent subprotection and infrastructure rent credits which currently limit our annual rental obligations to $1.0 million. The contractual obligations for that ground lease included above assumes the lesser of $1.0 million or annual lease rental obligation in effect as of December 31, 2020.

(3)    One of our ground lease obligations includes a component which is based on the percentage of gross income that exceeds the minimum ground rent. The minimum rent is subject to increases every five years based on 50% of the average annual percentage rent for the previous five years. The contractual obligations for that lease included above assume the current annual ground lease obligation in effect at December 31, 2020 for the remainder of the lease term since we cannot predict future adjustments.

(4)    One of our ground lease obligations is subject to a fair market value adjustment every five years based on a combination of CPI adjustments and third-party appraisals limited to maximum increases annually. The contractual obligations for that lease included above assume the current annual ground lease obligation in effect at December 31, 2020 for the remainder of the lease term since we cannot predict future adjustments.

(5)    One of our ground lease obligations includes a component which is based on the percentage of adjusted gross income that exceeds the minimum ground rent. The minimum rent is subject to increases every 10 years by an amount equal to 60% of the average annual percentage rent for the previous three years. The contractual obligations for this lease included above assume the current annual ground lease obligation in effect at December 31, 2020 for the remainder of the lease term since we cannot predict future adjustments.

(6)    One of our ground lease obligations is subject to fixed 5% ground rent increases every five years, with the next increase occurring on December 1, 2022.

Environmental Matters

We follow the policy of monitoring all of our properties, including acquisition, development, 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 December 31, 2020 and 2019, we had accrued environmental remediation liabilities of approximately $71.3 million and $80.7 million, respectively, recorded on our consolidated balance sheets in connection with certain of our in-process and future development projects. The accrued environmental remediation liabilities represent the remaining costs we estimate we will incur prior to and during the development process at various development acquisition sites. These estimates, which we developed with the assistance of third party experts, consist primarily of the removal of contaminated soil, performing environmental closure activities, constructing remedial systems, and other related costs since we are required to dispose of any existing contaminated soil, and sometimes perform other environmental closure or remedial activities, when we develop new buildings at these sites.

We record estimated environmental remediation obligations for acquired properties at the acquisition date when we are aware of such costs and when such costs are probable of being incurred and can be reasonably estimated. Estimated costs related to development environmental remediation liabilities are recorded as an increase to the cost of the development project. Actual costs are recorded as a decrease to the liability when incurred. These accruals are adjusted as an increase or decrease to the development project costs and as an increase or decrease to the accrued environmental remediation liability if we obtain further information or circumstances change. The environmental remediation obligations recorded at December 31, 2020 and 2019 were not discounted to their present values since the amount and timing of cash payments are not fixed. It is possible that we could incur additional environmental

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KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

remediation costs in connection with these development projects.  However, potential additional environmental costs for these development projects cannot be reasonably estimated at this time and certain changes in estimates could occur as the site conditions, final project timing, design elements, actual soil conditions and other aspects of the projects, which may depend upon municipal and other approvals beyond the control of the Company, are determined.

Other than the accrued environmental liabilities discussed above, we are not aware of any unasserted claims and assessments with respect to an environmental liability that we believe would require additional disclosure or the recording of an additional loss contingency.

Litigation

We and our properties are subject to litigation arising in the ordinary course of business. To our knowledge, neither we nor any of our properties are presently subject to any litigation or threat of litigation which, if determined unfavorably to us, would have a material adverse effect on our cash flow, financial condition, or results of operations.

Insurance

We maintain commercial general liability, auto liability, employers’ liability, umbrella/excess liability, special form property, difference in conditions including earthquake and flood, environmental, rental loss, and terrorism insurance covering all of our properties. Management believes the policy specifications and insured limits are reasonable given the relative risk of loss, the cost of the coverage, and industry practice. We do not carry insurance for generally uninsurable losses such as loss from governmental action, nuclear hazard, and war and military action. Policies are subject to various terms, conditions, and exclusions and some policies may involve large deductibles or co-payments.

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KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

19.    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 (see Note 16 “Employee Benefit Plans” for additional information). The following table sets forth the fair value of our marketable securities as of December 31, 2020 and 2019:

	Fair Value (Level 1) (1)
	2020		2019
Description	(in thousands)
Marketable securities (2)	$	27,481	$	27,098

____________________

(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 gain (loss) 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 included in general and administrative expenses on our consolidated statements of operations for the period.

The following table sets forth the net gain (loss) on marketable securities recorded during the years ended December 31, 2020, 2019 and 2018:

	December 31,
	2020		2019		2018
Description	(in thousands)
Net gain (loss) on marketable securities	$	2,864	$	3,885	$	(1,851)

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 December 31, 2020 and 2019: 

	December 31,
	2020				2019
	Carrying Value		Fair Value (1)		Carrying Value		Fair Value (1)
	(in thousands)
Liabilities
Secured debt, net	$	253,582	$	282,559	$	258,593	$	272,997
Unsecured debt, net	3,670,099		4,089,339		3,049,185		3,252,217
Unsecured line of credit	—		—		245,000		245,195

_______________

(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.

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KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

20.    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 years ended December 31, 2020, 2019 and 2018:

	Year Ended December 31,
	2020		2019		2018
	(in thousands, except unit and per unit amounts)
Numerator:
Net income attributable to common stockholders	$	187,105	$	195,443	$	258,415
Allocation to participating securities (1)	(2,229)		(2,119)		(2,004)
Numerator for basic and diluted net income available to common stockholders	$	184,876	$	193,324	$	256,411
Denominator:
Basic weighted average vested shares outstanding	113,241,341		103,200,568		99,972,359
Effect of dilutive securities	478,281		648,600		510,006
Diluted weighted average vested shares and common stock equivalents outstanding	113,719,622		103,849,168		100,482,365
Basic earnings per share:
Net income available to common stockholders per share	$	1.63	$	1.87	$	2.56
Diluted earnings per share:
Net income available to common stockholders per share	$	1.63	$	1.86	$	2.55

_____________________ 

(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, shares issuable under executed forward equity sale agreements, if any, and other securities are considered in our diluted earnings per share calculation for the years ended December 31, 2020, 2019, and 2018. Certain market measure-based RSUs are not included in dilutive securities as of December 31, 2020, 2019, and 2018 as not all performance metrics had been met by the end of the applicable reporting periods.

See Note 15 “Share-Based and Other Compensation” for additional information regarding the stock options and other share-based compensation.

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KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

21.    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 years ended December 31, 2020, 2019 and 2018:

	Year Ended December 31,
	2020		2019		2018
	(in thousands, except unit and per unit amounts)
Numerator:
Net income attributable to common unitholders	$	189,609	$	198,738	$	263,210
Allocation to participating securities (1)	(2,229)		(2,119)		(2,004)
Numerator for basic and diluted net income available to common unitholders	$	187,380	$	196,619	$	261,206
Denominator:
Basic weighted average vested units outstanding	115,095,506		105,223,975		102,025,276
Effect of dilutive securities	478,281		648,600		510,006
Diluted weighted average vested units and common unit equivalents outstanding	115,573,787		105,872,575		102,535,282
Basic earnings per unit:
Net income available to common unitholders per unit	$	1.63	$	1.87	$	2.56
Diluted earnings per unit:
Net income available to common unitholders per unit	$	1.62	$	1.86	$	2.55

____________________ 

(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, shares issuable under executed forward equity sale agreements, if any, and other securities are considered in our diluted earnings per share calculation for the years ended December 31, 2020, 2019 and 2018. Certain market measure-based RSUs are not included in dilutive securities as of December 31, 2020, 2019 and 2018 as not all performance metrics had been met by the end of the applicable reporting periods.

See Note 15 “Share-Based and Other Compensation” for additional information regarding the stock options and other share-based compensation.

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KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

22.    Supplemental Cash Flow Information of the Company

Supplemental cash flow information follows (in thousands):

	Year Ended December 31,
	2020		2019		2018
SUPPLEMENTAL CASH FLOWS INFORMATION:
Cash paid for interest, net of capitalized interest of $75,852, $77,666, and $65,627 as of    December 31, 2020, 2019 and 2018, respectively	$	61,741	$	43,607	$	44,697
Cash paid for amounts included in the measurement of ground lease liabilities	$	5,744	$	5,224	$	4,398
NON-CASH INVESTING TRANSACTIONS:
Accrual for expenditures for operating properties and development properties	$	189,161	$	162,654	$	158,626
Tenant improvements funded directly by tenants	$	11,592	$	10,268	$	13,968
Assumption of accrued liabilities in connection with acquisitions (Note 3)	$	—	$	10,267	$	40,624
Initial measurement of operating right of use ground lease assets (Notes 2, 3 and 18)	$	—	$	96,272	$	—
Initial measurement of operating ground lease liabilities (Notes 2, 3 and 18)	$	—	$	98,349	$	—
NON-CASH FINANCING TRANSACTIONS:
Accrual of dividends and distributions payable to common stockholders and common unitholders (Notes 13 and 27)	$	59,431	$	53,219	$	47,559
Exchange of common units of the Operating Partnership into shares of the Company’s common stock	$	37,640	$	78	$	1,962

The following is a reconciliation of our cash and cash equivalents and restricted cash at the beginning and end of the years ended December 31, 2020, 2019 and 2018.

	Year Ended December 31,
	2020		2019		2018
RECONCILIATION OF CASH AND CASH EQUIVALENTS AND RESTRICTED CASH:
Cash and cash equivalents at beginning of period	$	60,044	$	51,604	$	57,649
Restricted cash at beginning of period	16,300		119,430		9,149
Cash and cash equivalents and restricted cash at beginning of period	$	76,344	$	171,034	$	66,798
Cash and cash equivalents at end of period	$	731,991	$	60,044	$	51,604
Restricted cash at end of period	91,139		16,300		119,430
Cash and cash equivalents and restricted cash at end of period	$	823,130	$	76,344	$	171,034

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KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

23.    Supplemental Cash Flow Information of the Operating Partnership:

Supplemental cash flow information follows (in thousands):

	Year Ended December 31,
	2020		2019		2018
SUPPLEMENTAL CASH FLOWS INFORMATION:
Cash paid for interest, net of capitalized interest of $75,852, $77,666, and $65,627 as of December 31, 2020, 2019 and 2018, respectively	$	61,741	$	43,607	$	44,697
Cash paid for amounts included in the measurement of ground lease liabilities	$	5,744	$	5,224	$	4,398
NON-CASH INVESTING TRANSACTIONS:
Accrual for expenditures for operating properties and development properties	$	189,161	$	162,654	$	158,626
Tenant improvements funded directly by tenants	$	11,592	$	10,268	$	13,968
Assumption of accrued liabilities in connection with acquisitions (Note 3)	$	—	$	10,267	$	40,624
Initial measurement of operating right of use ground lease assets (Notes 2, 3 and 18)	$	—	$	96,272	$	—
Initial measurement of operating ground lease liabilities (Notes 2, 3 and 18)	$	—	$	98,349	$	—
NON-CASH FINANCING TRANSACTIONS:
Accrual of distributions payable to common unitholders (Notes 14 and 27)	$	59,431	$	53,219	$	47,559

The following is a reconciliation of our cash and cash equivalents and restricted cash at the beginning and end of the years ended December 31, 2020, 2019 and 2018.

	Year Ended December 31,
	2020		2019		2018
RECONCILIATION OF CASH AND CASH EQUIVALENTS AND RESTRICTED CASH:
Cash and cash equivalents at beginning of period	$	60,044	$	51,604	$	57,649
Restricted cash at beginning of period	16,300		119,430		9,149
Cash and cash equivalents and restricted cash at beginning of period	$	76,344	$	171,034	$	66,798
Cash and cash equivalents at end of period	$	731,991	$	60,044	$	51,604
Restricted cash at end of period	91,139		16,300		119,430
Cash and cash equivalents and restricted cash at end of period	$	823,130	$	76,344	$	171,034

F - 61

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

24.    Tax Treatment of Distributions

The following table reconciles the dividends declared per share of common stock to the dividends paid per share of common stock during the years ended December 31, 2020, 2019 and 2018 as follows: 

	Year Ended December 31,
Dividends	2020		2019		2018
Dividends declared per share of common stock	$	1.970	$	1.910	$	1.790
Less: Dividends declared in the current year and paid in the following year	(0.500)		(0.485)		(0.455)
Add: Dividends declared in the prior year and paid in the current year	0.485		0.455		0.425
Dividends paid per share of common stock	$	1.955	$	1.880	$	1.760

The unaudited income tax treatment for the dividends to common stockholders reportable for the years ended December 31, 2020, 2019 and 2018 as identified in the table above was as follows: 

	Year Ended December 31,
Shares of Common Stock	2020				2019				2018
Ordinary income (1)	$	1.474	75.40	%	$	0.939	49.95	%	$	1.474	83.73	%
Qualified dividend	0.002		0.12		0.004		0.21		0.003		0.19
Return of capital	0.162		8.30		0.312		16.62		0.275		15.64
Capital gains (2)	0.275		14.05		0.600		31.93		0.008		0.44
Unrecaptured section 1250 gains	0.042		2.13		0.025		1.29		—		—
	$	1.955	100.00	%	$	1.880	100.00	%	$	1.760	100.00	%

____________________

(1)The Tax Cuts and Jobs Act enacted on December 22, 2017 generally allows a deduction for noncorporate taxpayers equal to 20% of ordinary dividends distributed by a REIT (excluding capital gain dividends and qualified dividend income). The amount of dividend eligible for this deduction is referred to as the Section 199A Dividend.  For the year ended December 31, 2020, the Section 199A Dividend is equal to the total ordinary income dividend.

(2)Capital gains are comprised entirely of 20% rate gains.

F - 62

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

25.    Quarterly Financial Information of the Company (Unaudited)

Summarized quarterly financial data for the years ended December 31, 2020 and 2019 was as follows: 

	2020 Quarter Ended (1)
	March 31,		June 30,		September 30,		December 31,
	(in thousands, except per share amounts)
Revenues	$	221,328	$	219,423	$	228,314	$	229,332
Net income	45,418		24,352		54,071		83,452
Net income attributable to Kilroy Realty Corporation	39,817		19,618		49,028		78,642
Net income available to common stockholders	39,817		19,618		49,028		78,642
Net income available to common stockholders per share – basic	0.37		0.17		0.42		0.67
Net income available to common stockholders per share – diluted	0.37		0.17		0.42		0.67
	2019 Quarter Ended (1)
	March 31,		June 30,		September 30,		December 31,
	(in thousands, except per share amounts)
Revenues	$	201,202	$	200,492	$	215,525	$	220,235
Net income	41,794		47,215		48,298		77,922
Net income attributable to Kilroy Realty Corporation	36,903		42,194		43,846		72,500
Net income available to common stockholders	36,903		42,194		43,846		72,500
Net income available to common stockholders per share – basic	0.36		0.41		0.41		0.68
Net income available to common stockholders per share – diluted	0.36		0.41		0.41		0.67

____________________

(1)    The summation of the quarterly financial data may not equal the annual number reported on the consolidated statements of operations due to rounding.

F - 63

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

26.    Quarterly Financial Information of the Operating Partnership (Unaudited)

Summarized quarterly financial data for the years ended December 31, 2020 and 2019 was as follows:

	2020 Quarter Ended (1)
	March 31,		June 30,		September 30,		December 31,
	(in thousands, except per unit amounts)
Revenues	$	221,328	$	219,423	$	228,314	$	229,332
Net income	45,418		24,352		54,071		83,452
Net income attributable to the Operating Partnership	40,389		19,838		49,728		79,654
Net income available to common unitholders	40,389		19,838		49,728		79,654
Net income available to common unitholders per unit – basic	0.37		0.16		0.42		0.67
Net income available to common unitholders per unit – diluted	0.36		0.16		0.42		0.67
	2019 Quarter Ended (1)
	March 31,		June 30,		September 30,		December 31,
	(in thousands, except per unit amounts)
Revenues	$	201,202	$	200,492	$	215,525	$	220,235
Net income	41,794		47,215		48,298		77,922
Net income attributable to the Operating Partnership	37,508		42,901		44,589		73,740
Net income available to common unitholders	37,508		42,901		44,589		73,740
Net income available to common unitholders per unit – basic	0.36		0.41		0.41		0.68
Net income available to common unitholders per unit – diluted	0.36		0.41		0.41		0.67

______________________

(1)    The summation of the quarterly financial data may not equal the annual number reported on the consolidated statements of operations due to rounding.

27.    Subsequent Events

On January 15, 2021, $59.4 million of dividends were paid out to common stockholders, common unitholders and RSU holders of record on December 31, 2020.

On January 29, 2021, the Executive Compensation Committee granted 102,799 Time-Based RSUs to key employees under the 2006 Plan. The compensation cost related to the RSUs is expected to be recognized over a period of three years.

F - 64

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

SCHEDULE II – VALUATION AND QUALIFYING ACCOUNTS

Years ended December 31, 2020, 2019 and 2018

(in thousands)

	Balance at Beginning of Period (1)		Charged to Costs and Expenses (2)		Deductions (3)		Balance at End of Period
Allowance for Uncollectible Tenant Receivables for the year ended December 31,
2020 – Allowance for uncollectible tenant receivables	$	1,171	$	1,977	$	(1,349)	$	1,799
2019 – Allowance for uncollectible tenant receivables	512		907		(248)		1,171
2018 – Allowance for uncollectible tenant receivables	2,309		2,604		(274)		4,639
Allowance for Deferred Rent Receivables for the year ended December 31,
2020 – Allowance for deferred rent	$	1,552	$	832	$	(1,580)	$	804
2019 – Allowance for deferred rent	195		1,357		—		1,552
2018 – Allowance for deferred rent	3,238		165		(64)		3,339

____________________

(1)On January 1, 2019, the Company adopted Topic 842 on a modified retrospective basis and recognized a cumulative-effect adjustment to distributions in excess of earnings related to the allowances for uncollectible tenant receivables and deferred rent receivables. As such, the ending balances of the allowances for uncollectible tenant receivables and deferred rent receivables at December 31, 2018 do not equal the beginning balances on January 1, 2019.

(2)For the years ended December 31, 2020 and 2019, amounts do not reflect leases deemed not probable of collection for which we reversed the associated revenue under Topic 842. In addition, for the years ended December 31, 2020, 2019 and 2018, $1.7 million, $0.7 million and $2.9 million, respectively, was charged to costs and expenses for a valuation allowance for a note receivable.

(3)For the year ended December 31, 2020, includes reversals of allowance for doubtful accounts for tenants with an allowance at January 1, 2020 that were subsequently transitioned to a cash basis of reporting.

F - 65

KILROY REALTY CORPORATION AND KILROY REALTY, L.P

SCHEDULE III – REAL ESTATE AND ACCUMULATED DEPRECIATION

December 31, 2020

	Initial Cost								Gross Amounts at Which Carried at Close of Period
Property Location	Encumb- rances		Land and improve- ments		Buildings and Improve- ments		Costs Capitalized Subsequent  to Acquisition/ Improvement		Land and improve- ments		Buildings and Improve- ments		Total		Accumulated Depreciation		Depreci- ation Life (1)	Date of Acquisition (A)/ Construction (C) (2)		Rentable Square Feet (3) (unaudited)
	($ in thousands)
Office Properties:
3101-3243 S. La Cienega Blvd., Culver City, CA			$	150,718	$	31,033	$	227	$	150,718	$	31,259	$	181,977	$	6,127	35	2019	A	151,908
2240 E. Imperial Highway, El Segundo, CA			1,044		11,763		29,551		1,048		41,310		42,358		28,203		35	1983	C	122,870
2250 E. Imperial Highway, El Segundo, CA			2,579		29,062		36,311		2,547		65,405		67,952		56,603		35	1983	C	298,728
2260 E. Imperial Highway, El Segundo, CA			2,518		28,370		36,781		2,547		65,122		67,669		18,563		35	1983	C	298,728
909 N. Pacific Coast Highway, El Segundo, CA			3,577		34,042		51,773		3,577		85,815		89,392		44,727		35	2005	C	244,136
999 N. Pacific Coast Highway, El Segundo, CA			1,407		34,326		17,295		1,407		51,621		53,028		27,429		35	2003	C	128,588
1350 Ivar Ave., Los Angeles, CA			1,575		—		13,725		1,575		13,725		15,300		65		35	2020	C	16,448
1355 Vine St., Los Angeles, CA			17,588		—		114,603		17,588		114,603		132,191		549		35	2020	C	183,129
1375 Vine St., Los Angeles, CA			15,578		—		97,470		15,578		97,470		113,048		461		35	2020	C	159,236
1395 Vine St., Los Angeles, CA			278		—		3,138		278		3,138		3,417		16		35	2020	C	2,575
6115 W. Sunset Blvd., Los Angeles, CA (4)			1,313		3		16,454		2,455		15,315		17,770		2,787		35	2015	C	26,105
6121 W. Sunset Blvd., Los Angeles, CA (4)			11,120		4,256		43,983		8,703		50,656		59,359		8,894		35	2015	C	91,173
1525 N. Gower St., Los Angeles, CA (4)			1,318		3		9,641		1,318		9,645		10,962		1,542		35	2016	C	9,610
1575 N. Gower St., Los Angeles, CA (4)			22,153		51		119,496		22,153		119,547		141,700		15,482		35	2016	C	251,245
1500 N. El Centro Ave., Los Angeles, CA (4)			9,235		21		58,988		9,235		59,009		68,244		12,666		35	2016	C	104,504
6255 W. Sunset Blvd., Los Angeles, CA			18,111		60,320		49,265		18,111		109,585		127,696		41,735		35	2012	A	323,920
3750 Kilroy Airport Way, Long Beach, CA			—		1,941		13,113		—		15,054		15,054		11,247		35	1989	C	10,718
3760 Kilroy Airport Way, Long Beach, CA			—		17,467		16,687		—		34,154		34,154		28,166		35	1989	C	166,761
3780 Kilroy Airport Way, Long Beach, CA			—		22,319		31,855		—		54,174		54,174		41,573		35	1989	C	221,452
3800 Kilroy Airport Way, Long Beach, CA			—		19,408		22,252		—		41,660		41,660		26,473		35	2000	C	192,476
3840 Kilroy Airport Way, Long Beach, CA			—		13,586		11,755		—		25,341		25,341		16,793		35	1999	C	136,026
3880 Kilroy Airport Way, Long Beach, CA			—		9,704		11,827		—		21,531		21,531		5,220		35	1997	A	96,923
3900 Kilroy Airport Way, Long Beach, CA			—		12,615		13,208		—		25,823		25,823		19,261		35	1997	A	130,935
Kilroy Airport Center, Phase IV, Long Beach, CA (5)			—		—		4,997		—		4,997		4,997		4,997		35	—		—
8560 W. Sunset Blvd., West Hollywood, CA			9,720		50,956		1,930		9,720		52,886		62,606		8,351		35	2016	A	74,842
8570 W. Sunset Blvd., West Hollywood, CA			31,693		27,974		6,497		31,693		34,471		66,163		4,121		35	2016	A	45,941
8580 W. Sunset Blvd., West Hollywood, CA			10,013		3,695		1,219		10,013		4,914		14,927		523		35	2016	A	7,126
8590 W. Sunset Blvd., West Hollywood, CA			39,954		27,884		5,487		39,954		33,371		73,325		4,473		35	2016	A	55,302
12100 W. Olympic Blvd., Los Angeles, CA	$166,776	(6)	352		45,611		20,191		9,633		56,520		66,154		30,836		35	2003	C	152,048
12200 W. Olympic Blvd., Los Angeles, CA		(6)	4,329		35,488		25,506		3,977		61,346		65,323		42,135		35	2000	C	150,832
12233 W. Olympic Blvd., Los Angeles, CA			22,100		53,170		5,258		22,100		58,428		80,528		16,326		35	2012	A	151,029
12312 W. Olympic Blvd., Los Angeles, CA		(6)	3,325		12,202		12,345		3,399		24,473		27,872		14,923		35	1997	A	76,644
1633 26th St., Santa Monica, CA			2,080		6,672		4,006		2,040		10,718		12,758		7,497		35	1997	A	43,857
2100/2110 Colorado Ave., Santa Monica, CA			5,474		26,087		14,915		5,476		41,000		46,476		27,393		35	1997	A	102,864

F - 66

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

SCHEDULE III – REAL ESTATE AND ACCUMULATED DEPRECIATION – (Continued)

December 31, 2020

	Initial Cost				Gross Amounts at Which Carried at Close of Period
Property Location	Encumb- rances	Land and improve- ments	Buildings and Improve- ments	Costs Capitalized Subsequent  to Acquisition/ Improvement	Land and improve- ments	Buildings and Improve- ments	Total	Accumulated Depreciation	Depreci- ation Life (1)	Date of Acquisition (A)/ Construction (C) (2)		Rentable Square Feet (3) (unaudited)
	($ in thousands)
3130 Wilshire Blvd., Santa Monica, CA		8,921	6,579	17,147	9,188	23,459	32,647	17,318	35	1997	A	90,074
501 Santa Monica Blvd., Santa Monica, CA		4,547	12,044	16,304	4,551	28,344	32,895	19,067	35	1998	A	76,803
12225 El Camino Real, Del Mar, CA		1,700	9,633	3,864	1,673	13,524	15,197	9,622	35	1998	A	58,401
12235 El Camino Real, Del Mar, CA		1,507	8,543	9,255	1,540	17,765	19,305	11,193	35	1998	A	53,751
12340 El Camino Real, Del Mar, CA		4,201	13,896	12,195	4,201	26,091	30,292	13,226	35	2002	C	89,272
12390 El Camino Real, Del Mar, CA		3,453	11,981	9,541	3,453	21,522	24,975	10,742	35	2000	C	70,140
12348 High Bluff Dr., Del Mar, CA		1,629	3,096	6,890	1,629	9,986	11,615	6,963	35	1999	C	39,193
12400 High Bluff Dr., Del Mar, CA		15,167	40,497	16,850	15,167	57,347	72,514	30,685	35	2004	C	210,732
12770 El Camino Real, Del Mar, CA		9,360	—	34,212	9,360	34,212	43,572	4,493	35	2015	C	73,032
12780 El Camino Real, Del Mar, CA		18,398	54,954	22,922	18,398	77,876	96,274	18,909	35	2013	A	140,591
12790 El Camino Real, Del Mar, CA		10,252	21,236	8,485	10,252	29,721	39,973	6,812	35	2013	A	78,836
12860 El Camino Real, Del Mar, CA (7)		—	—	60,675	11,326	49,349	60,675	602	35	—		—
12830 El Camino Real, Del Mar, CA (7)		—	—	134,776	28,645	106,131	134,776	885	35	—		—
3579 Valley Centre Dr., Del Mar, CA		2,167	6,897	9,559	2,858	15,765	18,623	10,397	35	1999	C	54,960
3611 Valley Centre Dr., Del Mar, CA		4,184	19,352	25,934	5,259	44,212	49,470	27,028	35	2000	C	130,109
3661 Valley Centre Dr., Del Mar, CA		4,038	21,144	18,897	4,725	39,354	44,079	24,083	35	2001	C	128,364
3721 Valley Centre Dr., Del Mar, CA		4,297	18,967	14,973	4,254	33,983	38,237	19,134	35	2003	C	115,193
3811 Valley Centre Dr., Del Mar, CA		3,452	16,152	20,540	4,457	35,687	40,144	24,154	35	2000	C	112,067
3745 Paseo Place, Del Mar, CA (Retail)		24,358	—	72,290	24,358	72,290	96,648	4,435	35	2019	C	95,871
13280 Evening Creek Dr. South, I-15 Corridor, CA		3,701	8,398	4,818	3,701	13,216	16,917	6,354	35	2008	C	41,196
13290 Evening Creek Dr. South, I-15 Corridor, CA		5,229	11,871	6,150	5,229	18,021	23,250	7,665	35	2008	C	61,180
13480 Evening Creek Dr. South, I-15 Corridor, CA		7,997	—	52,581	7,997	52,581	60,578	21,940	35	2008	C	154,157
13500 Evening Creek Dr. South, I-15 Corridor, CA		7,581	35,903	23,609	7,580	59,513	67,093	24,861	35	2004	A	137,658
13520 Evening Creek Dr. South, I-15 Corridor, CA		7,581	35,903	19,454	7,580	55,358	62,938	27,289	35	2004	A	146,701
2305 Historic Decatur Rd., Point Loma, CA		5,240	22,220	7,650	5,240	29,870	35,110	12,291	35	2010	A	107,456
4690 Executive Dr., University Towne Centre, CA		1,623	7,926	3,725	1,623	11,651	13,274	8,314	35	1999	A	47,846
4100 Bohannon Dr., Menlo Park, CA		4,835	15,526	932	4,860	16,433	21,293	5,123	35	2012	A	47,379
4200 Bohannon Dr., Menlo Park, CA		4,798	15,406	3,967	4,662	19,509	24,171	6,585	35	2012	A	45,451
4300 Bohannon Dr., Menlo Park, CA		6,527	20,958	5,373	6,470	26,387	32,858	8,557	35	2012	A	63,079
4400 Bohannon Dr., Menlo Park, CA		4,798	15,406	3,331	4,939	18,597	23,535	6,394	35	2012	A	48,146
4500 Bohannon Dr., Menlo Park, CA		6,527	20,957	3,811	6,470	24,825	31,295	7,506	35	2012	A	63,078
4600 Bohannon Dr., Menlo Park, CA		4,798	15,406	4,025	4,939	19,290	24,229	6,427	35	2012	A	48,147
4700 Bohannon Dr., Menlo Park, CA		6,527	20,958	1,584	6,470	22,599	29,069	7,112	35	2012	A	63,078
1290 - 1300 Terra Bella Ave., Mountain View, CA		28,730	27,555	61	28,730	27,616	56,346	5,702	35	2016	A	114,175

F - 67

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

SCHEDULE III – REAL ESTATE AND ACCUMULATED DEPRECIATION – (Continued)

December 31, 2020

	Initial Cost					Gross Amounts at Which Carried at Close of Period
Property Location	Encumb- rances		Land and improve- ments	Buildings and Improve- ments	Costs Capitalized Subsequent  to Acquisition/ Improvement	Land and improve- ments	Buildings and Improve- ments	Total	Accumulated Depreciation	Depreci- ation Life (1)	Date of Acquisition (A)/ Construction (C) (2)		Rentable Square Feet (3) (unaudited)
	($ in thousands)
680 E. Middlefield Rd., Mountain View, CA			34,605	—	56,522	34,605	56,522	91,127	11,718	35	2014	C	170,090
690 E. Middlefield Rd., Mountain View, CA			34,755	—	56,764	34,755	56,765	91,519	11,768	35	2014	C	170,823
1701 Page Mill Rd., Palo Alto, CA			—	99,522	29	—	99,551	99,551	12,005	35	2016	A	128,688
3150 Porter Dr., Palo Alto, CA			—	21,715	410	—	22,125	22,125	3,170	35	2016	A	36,886
900 Jefferson Ave., Redwood City, CA (8)			16,668	—	109,377	18,063	107,982	126,045	19,674	35	2015	C	228,505
900 Middlefield Rd., Redwood City, CA (8)			7,959	—	50,115	8,626	49,449	58,074	8,684	35	2015	C	118,764
100 Hooper St., San Francisco, CA			78,564	—	191,895	85,510	184,949	270,459	11,632	35	2018	C	394,340
100 First St., San Francisco, CA (9)			49,150	131,238	73,238	49,150	204,476	253,626	73,294	35	2010	A	480,457
201 Third St., San Francisco, CA			19,260	84,018	69,158	19,260	153,176	172,436	65,165	35	2011	A	346,538
250 Brannan St., San Francisco, CA			7,630	22,770	10,043	7,630	32,813	40,443	11,783	35	2011	A	100,850
301 Brannan St., San Francisco, CA			5,910	22,450	7,704	5,910	30,154	36,064	11,022	35	2011	A	82,834
303 Second St., San Francisco, CA (10)			63,550	154,153	99,670	63,550	253,823	317,373	96,466	35	2010	A	784,658
333 Brannan St., San Francisco, CA			18,645	—	80,788	18,645	80,787	99,433	11,221	35	2016	C	185,602
345 Brannan St., San Francisco, CA			29,405	113,179	752	29,403	113,933	143,336	6,967	35	2018	A	110,050
350 Mission St., San Francisco, CA			52,815	—	213,312	52,815	213,312	266,127	31,186	35	2016	C	455,340
360 Third St., San Francisco, CA			—	88,235	121,629	28,504	181,360	209,864	53,833	35	2011	A	429,796
1800 Owens St., San Francisco, CA			95,388	—	437,715	95,388	437,715	533,103	20,951	35	2019	C	750,370
345 Oyster Point Blvd., South San Francisco, CA			13,745	18,575	—	13,745	18,576	32,320	1,723	35	2018	A	40,410
347 Oyster Point Blvd., South San Francisco, CA			14,071	18,289	44	14,071	18,333	32,404	1,701	35	2018	A	39,780
349 Oyster Point Blvd., South San Francisco, CA			23,112	22,601	324	23,112	22,925	46,037	2,968	35	2018	A	65,340
Kilroy Oyster Point, Phase I, South San Francisco, CA (11)			—	—	620	—	620	620	—	35	—		—
505 Mathilda Ave., Sunnyvale, CA			37,843	1,163	50,450	37,943	51,513	89,456	9,267	35	2014	C	212,322
555 Mathilda Ave., Sunnyvale, CA			37,843	1,163	50,447	37,943	51,510	89,453	9,267	35	2014	C	212,322
599 Mathilda Ave., Sunnyvale, CA			13,538	12,559	63	13,538	12,622	26,160	4,559	35	2012	A	76,031
605 Mathilda Ave., Sunnyvale, CA			29,014	891	77,282	29,090	78,096	107,187	20,542	35	2014	C	162,785
601 108th Ave., Bellevue, WA			—	214,095	40,300	—	254,395	254,395	88,958	35	2011	A	488,470
10900 NE 4th St., Bellevue, WA			25,080	150,877	45,984	25,080	196,861	221,941	62,594	35	2012	A	428,557
837 N. 34th St., Lake Union, WA			—	37,404	6,293	—	43,697	43,697	12,787	35	2012	A	112,487
701 N. 34th St., Lake Union, WA			—	48,027	8,545	—	56,572	56,572	18,277	35	2012	A	141,860
801 N. 34th St., Lake Union, WA			—	58,537	20,661	—	79,198	79,198	20,013	35	2012	A	169,412
320 Westlake Ave. North, Lake Union, WA	87,589	(12)	14,710	82,018	14,453	14,710	96,471	111,181	23,304	35	2013	A	184,644
321 Terry Ave. North, Lake Union, WA		(12)	10,430	60,003	10,366	10,430	70,369	80,799	18,091	35	2013	A	135,755
401 Terry Ave. North, Lake Union, WA			22,500	77,046	13	22,500	77,059	99,559	18,225	35	2014	A	140,605
333 Dexter Ave. North, South Lake Union, WA (13)			—	—	323,433	42,853	280,580	323,433	2,592	35	0		—

F - 68

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

SCHEDULE III – REAL ESTATE AND ACCUMULATED DEPRECIATION – (Continued)

December 31, 2020

	Initial Cost									Gross Amounts at Which Carried at Close of Period
Property Location	Encumb- rances			Land and improve- ments		Buildings and Improve- ments		Costs Capitalized Subsequent  to Acquisition/ Improvement		Land and improve- ments		Buildings and Improve- ments		Total		Accumulated Depreciation		Depreci- ation Life (1)	Date of Acquisition (A)/ Construction (C) (2)		Rentable Square Feet (3) (unaudited)
	($ in thousands)
Residential Properties:
1550 N. El Centro Ave., Los Angeles, CA (4) (14)				16,970		39		136,137		16,970		136,176		153,146		17,894		35	2016	C	—
3200 Paseo Village Way, Del Mar, CA (15)				106,419		—		272,457		106,419		272,457		378,876		7,316		35	2020	C	—
TOTAL OPERATING PROPERTIES	254,365			1,496,855		2,699,959		4,215,126		1,628,848		6,783,092		8,411,940		1,798,646					14,620,166
Undeveloped land and construction in progress	—			874,773		—		903,333		874,773		903,333		1,778,106		—					—
TOTAL ALL PROPERTIES	$	254,365	(16)	$	2,371,628	$	2,699,959	$	5,118,459	$	2,503,621	$	7,686,425	$	10,190,046	$	1,798,646				14,620,166

____________________

(1)The initial costs of buildings and improvements are depreciated over 35 years using a straight-line method of accounting; improvements capitalized subsequent to acquisition are depreciated over the shorter of the lease term or useful life, generally ranging from one to 20 years.

(2)Represents our date of construction or acquisition, or of our predecessor, the Kilroy Group.

(3)Represents the square footage of our stabilized portfolio.

(4)These properties include the costs of a shared parking structure for a complex comprised of five office buildings and one residential tower. The costs of the parking structure are allocated amongst the six buildings.

(5)These costs represent infrastructure costs incurred in 1989. During the third quarter of 2009, we exercised our option to terminate the ground lease at Kilroy Airport Center, Phase IV in Long Beach, California. We had previously leased this land, which is adjacent to our office properties at Kilroy Airport Center, Long Beach, for potential future development opportunities.

(6)These properties secure a $166.8 million mortgage note.

(7)These properties are currently in the tenant improvement phase of our in-process development projects and not yet in the stabilized portfolio. The estimated rentable square feet for these properties is 285,000 rentable square feet.

(8)These properties are owned by Redwood City Partners LLC, a consolidated property partnership.

(9)This property is owned by 100 First Street Member LLC, a consolidated property partnership.

(10)This property is owned by 303 Second Street Member LLC, a consolidated property partnership.

(11)Represents the tenant funded portion of base building improvements for a project under construction.

(12)These properties secure a $87.6 million mortgage note.

(13)This property is currently in the tenant improvement phase of our in-process development projects and not yet in the stabilized portfolio. The estimated rentable square feet for this property is 635,000 rentable square feet.

(14)This property represents the 200-unit Columbia Square residential tower that was added to the stabilized portfolio in 2016.

(15)This property represents the 608-unit One Paseo residential project that was added to the stabilized portfolio in 2020.

(16)Represents gross aggregate principal amount before the effect of the deferred financing costs of $0.8 million as of December 31, 2020.

F - 69

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

SCHEDULE III – REAL ESTATE AND ACCUMULATED DEPRECIATION – (Continued)

December 31, 2020

As of December 31, 2020, the aggregate gross cost of property included above for federal income tax purposes approximated $8.6 billion.

The following table reconciles the historical cost of total real estate held for investment from January 1, 2018 to December 31, 2020:

	Year Ended December 31,
	2020		2019		2018 (1)
	(in thousands)
Total real estate held for investment, beginning of year	$	9,628,773	$	8,426,632	$	7,417,777
Additions during period:
Acquisitions	—		460,512		581,671
Improvements, etc.	645,170		890,654		724,016
Total additions during period	645,170		1,351,166		1,305,687
Deductions during period:
Cost of real estate sold	(44,070)		(120,788)		(286,623)
Other	(39,827)		(28,237)		(10,209)
Total deductions during period	(83,897)		(149,025)		(296,832)
Total real estate held for investment, end of year	$	10,190,046	$	9,628,773	$	8,426,632

____________________

(1)Amounts presented in Improvements, etc. and Other have been revised for the year ended December 31, 2018 to conform to the current year presentation with amounts transferred from undeveloped land and construction in progress to land and improvements and buildings and improvements presented on a net basis, which did not have any impact on total real estate held for investment at December 31, 2018.

The following table reconciles the accumulated depreciation from January 1, 2018 to December 31, 2020:

	Year Ended December 31,
	2020		2019		2018
	(in thousands)
Accumulated depreciation, beginning of year	$	1,561,361	$	1,391,368	$	1,264,162
Additions during period:
Depreciation of real estate	244,815		211,893		198,578
Total additions during period	244,815		211,893		198,578
Deductions during period:
Write-offs due to sale	(6,401)		(41,655)		(71,372)
Other	(1,129)		(245)		—
Total deductions during period	(7,530)		(41,900)		(71,372)
Accumulated depreciation, end of year	$	1,798,646	$	1,561,361	$	1,391,368

F - 70

EXHIBIT INDEX

Exhibit Number	Description
3.(i)1	Articles of Amendment and Restatement of Kilroy Realty Corporation (previously filed by Kilroy Realty Corporation as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on May 21, 2020)
3.(i)2	Certificate of Limited Partnership of Kilroy Realty, L.P. (previously filed by Kilroy Realty, L.P., as an exhibit to the General Form for Registration of Securities on Form 10 as filed with the Securities and Exchange Commission on August 18, 2010)
3.(i)3	Amendment to the Certificate of Limited Partnership of Kilroy Realty, L.P. (previously filed by Kilroy Realty, L.P., as an exhibit to the General Form for Registration of Securities on Form 10 as filed with the Securities and Exchange Commission on August 18, 2010)
3.(i)4	Articles Supplementary reclassifying shares of the Series G Preferred Stock of the Company (previously filed by Kilroy Realty Corporation as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on August 23, 2017)
3.(i)5	Articles Supplementary reclassifying shares of the Series H Preferred Stock of the Company (previously filed by Kilroy Realty Corporation as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on August 23, 2017)
3.(ii)1	Sixth Amended and Restated Bylaws of Kilroy Realty Corporation (previously filed by Kilroy Realty Corporation as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on December 30, 2020)
3.(ii)2	Seventh Amended and Restated Agreement of Limited Partnership of Kilroy Realty, L.P. dated August 15, 2012, as amended (previously filed by Kilroy Realty Corporation on Form 10-Q for the quarter ended June 30, 2014)
4.(vi)1*	Description of Capital Stock of Kilroy Realty Corporation
4.(vi)2	Description of Common Units Representing Limited Partnership Interests of Kilroy Realty, L.P.
4.1	Kilroy Realty Corporation Form of Certificate for Common Stock (previously filed by Kilroy Realty Corporation as an exhibit to the Registration Statement on Amendment No. 3 to Form S-11 (No. 333-15553))
4.2	Registration Rights Agreement, dated January 31, 1997 (previously filed by Kilroy Realty Corporation as an exhibit to the Registration Statement on Amendment No. 3 to Form S-11 (No. 333-15553))
4.3	Form of Certificate for Partnership Units of Kilroy Realty, L.P. (previously filed by Kilroy Realty, L.P., as an exhibit to the General Form for Registration of Securities on Form 10 as filed with the Securities and Exchange Commission on August 18, 2010)
4.4	Registration Rights Agreement, dated July 31, 2012 (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended June 30, 2012)
4.5	Officers’ Certificate pursuant to Sections 101, 201, 301 and 303 of the Indenture dated March 1, 2011, among Kilroy Realty, L.P., as issuer, Kilroy Realty Corporation, as guarantor, and U.S. Bank National Association, as trustee, establishing a series of securities entitled “3.800% Notes due 2023,” including the form of 3.800% Notes due 2023 and the form of related guarantee (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P. as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on January 14, 2013)
4.6	Indenture, dated March 1, 2011, by and among Kilroy Realty, L.P., as issuer, Kilroy Realty Corporation, as guarantor, and U.S. Bank National Association, as trustee (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P. as an exhibit to the Registration Statement on Form S-3 as filed with the Securities and Exchange Commission on October 2, 2013)
4.7	Supplemental Indenture, dated July 5, 2011, among Kilroy Realty, L.P., as issuer, Kilroy Realty Corporation, as guarantor, and U.S. Bank National Association, as trustee (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P. as an exhibit to the Registration Statement on Form S-3 as filed with the Securities and Exchange Commission on October 2, 2013)

4.8	Officers’ Certificate pursuant to Sections 102, 201, 301 and 303 of the Indenture dated March 1, 2011, among Kilroy Realty, L.P., as issuer, Kilroy Realty Corporation, as guarantor, and U.S. Bank National Association, as trustee, establishing a series of securities entitled “4.25% Senior Notes due 2029,” including the form of 4.25% Senior Notes due 2029 and the form of related guarantee (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P. as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on August 6, 2014)
4.9	Officers’ Certificate, dated September 16, 2015, pursuant to Sections 102, 201, 301 and 303 of the Indenture dated March 1, 2011, among Kilroy Realty, L.P., as issuer, Kilroy Realty Corporation, as guarantor, and U.S. Bank National Association, as trustee, establishing a series of securities entitled “4.375% Senior Notes due 2025,” including the form of 4.375% Senior Notes due 2025 and the form of related guarantee (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P. as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on September 16, 2015)
4.10	Officers’ Certificate, dated December 11, 2017, pursuant to Sections 102, 201, 301 and 303 of the Indenture dated March 1, 2011, among Kilroy Realty, L.P., as issuer, Kilroy Realty Corporation, as guarantor, and U.S. Bank National Association, as trustee, establishing a series of securities entitled “3.450% Senior Notes due 2024,” including the form of 3.450% Senior Notes due 2024 and the form of related guarantee (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P. as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on December 11, 2017)
4.11	Officers’ Certificate, dated November 29, 2018, pursuant to Sections 102, 201, 301 and 303 of the Indenture dated March 1, 2011, as amended and supplemented, among Kilroy Realty, L.P., as issuer, Kilroy Realty Corporation, as guarantor, and U.S. Bank National Association, as trustee, establishing a series of securities entitled “4.750% Senior Notes due 2028,” including the form of 4.750% Senior Note due 2028 and the form of related guarantee (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on November 29, 2018)
4.12	Officers’ Certificate, dated September 17, 2019, pursuant to Sections 102, 201, 301 and 303 of the Indenture dated March 1, 2011, as amended and supplemented, among Kilroy Realty, L.P., as issuer, Kilroy Realty Corporation, as guarantor, and U.S. Bank National Association, as trustee, establishing a series of securities entitled “3.050% Senior Notes due 2030,” including the form of 3.050% Senior Note due 2030 and the form of related guarantee (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P. as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on September 17, 2019)
4.13	Officers’ Certificate, dated August 12, 2020, pursuant to Sections 102, 201, 301 and 303 of the Indenture dated March 1, 2011, as amended and supplemented, among Kilroy Realty, L.P., as issuer, Kilroy Realty Corporation, as guarantor, and U.S. Bank National Association, as trustee, establishing a series of securities entitled “2.500% Senior Notes due 2032,” including the form of 2.500% Senior Note due 2032 and the form of related guarantee (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on August 18, 2020)
4.14	The Company is party to agreements in connection with long-term debt obligations, none of which individually exceeds ten percent of the total assets of the Company on a consolidated basis. Pursuant to Item 601(b)(4)(iii)(A) of Regulation S-K, the Company agrees to furnish copies of these agreements to the Commission upon request
10.1	Pledge Agreement by and among Kilroy Realty, L.P., John B. Kilroy, Sr., John B. Kilroy, Jr. and Kilroy Industries (previously filed by Kilroy Realty Corporation as an exhibit to the Registration Statement on Amendment No. 3 to Form S-11 (No. 333-15553))
10.2†	1997 Stock Option and Incentive Plan of the Registrant and Kilroy Realty, L.P. (previously filed by Kilroy Realty Corporation as an exhibit to the Registration Statement on Amendment No. 3 to Form S-11 (No. 333-15553))
10.3	License Agreement by and among the Registrant and the other persons named therein (previously filed by Kilroy Realty Corporation as an exhibit to the Registration Statement on Amendment No. 4 to Form S-11 (No. 333-15553))
10.4†	Form of Restricted Stock Award Agreement (previously filed by Kilroy Realty Corporation as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on February 8, 2007)
10.5†	Kilroy Realty Corporation Stock Award Deferral Program (previously filed by Kilroy Realty Corporation as an exhibit to Form 8-K as filed with the Securities and Exchange Commission on January 2, 2008)

10.6†	Form of Indemnification Agreement of Kilroy Realty Corporation with certain officers and directors (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-K for the year ended December 31, 2009)
10.7†	Kilroy Realty Corporation Form of Stock Option Grant Notice and Stock Option Agreement (previously filed by Kilroy Realty Corporation as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on February 24, 2012)
10.8†	Form of Restricted Stock Unit Agreement (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended June 30, 2013)
10.9†	Form of Stock Award Deferral Program Restricted Stock Unit Agreement (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended June 30, 2013)
10.10†	Form of Performance-Vest Restricted Stock Unit Agreement (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended March 31, 2014)
10.11†	Form of Restricted Stock Unit Agreement (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended March 31, 2014)
10.12†	Form of Restricted Stock Unit Agreement for Non-Employee Members of the Board of Directors (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended March 31, 2014)
10.13†	Form of Performance-Vest Restricted Stock Unit Agreement (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended March 31, 2015)
10.14†	Form of Restricted Stock Unit Agreement (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended March 31, 2015)
10.15†	Form of Restricted Stock Unit Agreement for Non-Employee Members of the Board of Directors (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended March 31, 2015)
10.16†	Separation Agreement by and between Kilroy Realty Corporation, Kilroy Realty, L.P. and Jeffrey C. Hawken dated as of July 2, 2020 (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended June 30, 2020)
10.17†	Amended and Restated Employment Agreement and Non-Competition Agreement by and between Kilroy Realty Corporation, Kilroy Realty, L.P. and Tyler H. Rose effective as of January 28, 2016 (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended March 31, 2016)
10.18†	Amended and Restated Employment Agreement and Non-Competition Agreement by and between Kilroy Realty Corporation, Kilroy Realty, L.P. and Justin W. Smart effective as of January 28, 2016 (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended March 31, 2016)
10.19†	Kilroy Realty Corporation Director Compensation Policy effective as of April 1, 2018 (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended March 31, 2018.
10.20†	Employment Agreement, as amended and restated December 27, 2018, by and between Kilroy Realty Corporation, Kilroy Realty, L.P. and John B. Kilroy, Jr. (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on December 31, 2018)
10.21†	Kilroy Realty Corporation 2006 Incentive Award Plan Restricted Stock Unit Agreement by and between Kilroy Realty Corporation and John B. Kilroy, Jr., dated December 27, 2018 (with retirement as to Time-Based RSUs) (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on December 31, 2018)
10.22†	Kilroy Realty Corporation 2006 Incentive Award Plan Restricted Stock Unit Agreement by and between Kilroy Realty Corporation and John B. Kilroy, Jr., dated December 27, 2018 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on December 31, 2018)
10.23†	Form of Restricted Stock Unit Agreement for 2006 Incentive Award Plan
10.24	Note Purchase Agreement dated September 14, 2016 (previously filed by Kilroy Realty Corporation as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on September 14, 2016)

10.25	Amendment to Note Purchase Agreement dated May 11, 2018 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on May 14, 2018)
10.26	Form of Time Sharing Agreement of Kilroy Realty, L.P. (previously filed by Kilroy Realty Corporation as an exhibit on Form 10-Q for the quarter ended September 30, 2016)
10.27	Promissory Note, dated November 29, 2016 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 10-K for the year ended December 31, 2017)
10.28	Loan Agreement, dated November 29, 2016, by and between KR WMC, LLC and Massachusetts Mutual Life Insurance Company (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 10-K for the year ended December 31, 2017)
10.29	Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing, dated November 29, 2016 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 10-K for the year ended December 31, 2017)
10.30	Assignment of Leases and Rents, dated November 29, 2016 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 10-K for the year ended December 31, 2017)
10.31	Recourse Guaranty Agreement, dated November 29, 2016 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 10-K for the year ended December 31, 2017)
10.32	Environmental Indemnification Agreement, dated November 29, 2016 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 10-K for the year ended December 31, 2017)
10.33†	Kilroy Realty Corporation 2007 Deferred Compensation Plan, as amended and restated effective January 1, 2017 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 10-K for the year ended December 31, 2016)
10.34	General Partner Guaranty Agreement, dated February 17, 2017 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 10-Q for the quarter ended March 31, 2017)
10.35†	Kilroy Realty 2006 Incentive Award Plan (previously filed by Kilroy Realty Corporation as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on May 21, 2020)
10.36	Second Amended and Restated Credit Agreement dated as of July 24, 2017 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 10-Q for the quarter ended June 30, 2017)
10.37	Second Amended and Restated Guaranty dated as of July 24, 2017 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 10-Q for the quarter ended on June 30, 2017)
10.38	Note Purchase Agreement dated May 11, 2018 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on May 14, 2018)
10.39	Sales Agreement, dated June 5, 2018 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on June 5, 2018)
10.40	Forward Sale Agreement dated February 18, 2020 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on February 21, 2020)
10.41	Forward Sale Agreement dated February 18, 2020 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on February 21, 2020)
10.42	Forward Sale Agreement dated February 18, 2020 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on February 21, 2020)
10.43	Forward Sale Agreement dated February 18, 2020 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on February 21, 2020)

10.44	Note Purchase Agreement dated April 28, 2020 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on April 30, 2020)
10.45	General Partner Guaranty Agreement dated April 28, 2020 (previously filed by Kilroy Realty Corporation and Kilroy Realty, L.P., as an exhibit on Form 8-K as filed with the Securities and Exchange Commission on April 30, 2020)
21.1*	List of Subsidiaries of Kilroy Realty Corporation
21.2*	List of Subsidiaries of Kilroy Realty, L.P.
23.1*	Consent of Deloitte & Touche LLP for Kilroy Realty Corporation
23.2*	Consent of Deloitte & Touche LLP for Kilroy Realty, L.P.
24.1*	Power of Attorney (included on the signature page of this Form 10-K)
31.1*	Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer of Kilroy Realty Corporation
31.2*	Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer of Kilroy Realty Corporation
31.3*	Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer of Kilroy Realty, L.P.
31.4*	Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer of Kilroy Realty, L.P.
32.1*	Section 1350 Certification of Chief Executive Officer of Kilroy Realty Corporation
32.2*	Section 1350 Certification of Chief Financial Officer of Kilroy Realty Corporation
32.3*	Section 1350 Certification of Chief Executive Officer of Kilroy Realty, L.P.
32.4*	Section 1350 Certification of Chief Financial Officer of Kilroy Realty, L.P.
101.1*	The following Kilroy Realty Corporation and Kilroy Realty, L.P. financial information for the year ended December 31, 2020, formatted in inline XBRL (eXtensible Business Reporting Language): (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Income, (iii) Consolidated Statements of Changes in Equity, (iv) Consolidated Statements of Capital, (v) Consolidated Statements of Cash Flows and (vi) Notes to the Consolidated Financial Statements(1)
104*	Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101.1)

*	Filed herewith
†	Management contract or compensatory plan or arrangement.
(1)	Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933 or Section 18 of the Securities Exchange Act of 1934 and otherwise are not subject to liability under these sections.

EX-4.(VI)1

Exhibit 4.(vi)1

DESCRIPTION OF CAPITAL STOCK

The following is a description of some of the material terms and provisions of the capital stock of Kilroy Realty Corporation registered under Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The following description is a summary only and does not purport to be complete and is subject to, and qualified in its entirety by reference to the provisions of the Company’s charter and bylaws, copies of which have been filed as exhibits to the Annual Report on Form 10-K to which this “Description of Capital Stock” is an exhibit, and the applicable provisions of the Maryland General Corporation Law (the “MGCL”). While we believe the following description covers the material terms and provisions of our common stock it may not include all of the information that is important to you. We encourage you to read carefully the applicable provisions of the MGCL and our charter and bylaws for a more complete understanding of our common stock.As used in this “Description of Capital Stock,” references to the “Company,” “we,” “our” or “us” refer solely to Kilroy Realty Corporation and not to any of its subsidiaries, unless otherwise expressly stated or the context otherwise requires.

Common Stock

General

The Company’s charter authorizes us to issue up to 280,000,000 shares of common stock, par value $.01 per share. As of December 31, 2020, we had 116,035,827 shares of common stock issued and outstanding.

Shares of our common stock:

•are entitled to one vote per share on all matters presented to stockholders generally for a vote, including the election of directors, with no right to cumulative voting;

•do not have any conversion rights;

•do not have any exchange rights;

•do not have any sinking fund rights;

•do not have any redemption rights;

•do not generally have any appraisal rights;

•do not have any preemptive rights to subscribe for any of our securities; and

•are subject to restrictions on ownership and transfer.

We may pay dividends and other distributions on shares of the Company’s common stock, subject to the preferential rights of any series or class of capital stock that we may issue in the future with rights to dividends and other distributions senior to the Company’s common stock or creditors, in the case of our liquidation, dissolution or winding-up. However, we may only pay dividends when the board of directors (in its sole discretion) authorizes and declares a dividend out of legally available funds therefor. All dividends and other distributions will be paid to the holders of our common stock on pro rata basis.

The Company’s board of directors may:

•in its sole discretion, classify or reclassify any unissued shares of the Company’s common stock into other classes or series of capital stock, whether now or hereafter authorized;

•establish the number of shares in each of these classes or series of capital stock;

•establish the par value of the shares in each of these classes or series of capital stock;

•establish any preference rights, conversion rights and other rights, including voting powers, of each of these classes or series of capital stock;

•establish restrictions, such as limitations and restrictions on ownership, transfer, dividends or other distributions of each of these classes or series of capital stock; and

•establish qualifications and terms or conditions of redemption for each of these classes or series of capital stock.

In addition, the Company does not have a classified board of directors.

Preferred Stock

The Company’s charter authorizes us to issue up to 30,000,000 shares of preferred stock, par value $.01 per share, none of which are currently classified and designated or are issued and outstanding. As of December 31, 2020, 30,000,000 shares of the Company’s preferred stock were available for classification, designation and issuance.

We may classify, designate and issue authorized shares of preferred stock, in one or more classes or series, as authorized by the board of directors without the prior consent of the Company’s stockholders. The board of directors may grant the holders of preferred stock of any class or series preferences, powers and rights—voting or otherwise—senior to the rights of holders of shares of the Company’s common stock. The board of directors can authorize the issuance of currently authorized shares of preferred stock with terms and conditions that could have the effect of delaying or preventing a change of control transaction that might involve a premium price for holders of shares of the Company’s common stock or otherwise be in their best interest. All shares of preferred stock that and are or become issued and outstanding are or will be fully paid and nonassessable. Before we may issue any shares of preferred stock of any class or series, the MGCL and the Company’s charter require the board of directors to determine the following with respect to such class or series:

•the designation;

•the terms;

•preferences with respect to distributions and in the event of our liquidation, dissolution or winding-up;

•conversion and other rights, if any;

•voting powers;

•restrictions;

•limitations as to distributions;

•qualifications; and

•terms or conditions of redemption, if any.

Restrictions on Ownership and Transfer of the Company’s Capital Stock

Internal Revenue Code Requirements

To maintain the Company’s tax status as a REIT, five or fewer “individuals,” as that term is defined in the Code, which includes certain entities, may not own, actually or constructively, more than 50% in value of the Company’s issued and outstanding capital stock at any time during the last half of a taxable year. Constructive ownership provisions in the Code determine if any individual or entity constructively owns the Company’s capital stock for purposes of this requirement. In addition, 100 or more persons must beneficially own the Company’s capital stock during at least 335 days of a taxable year or during a proportionate part of a short taxable year. Also, rent from tenants in which we actually or constructively own a 10% or greater interest is not qualifying income for purposes of the gross income tests of the Code. To help ensure we meet these tests, the Company’s charter restricts the acquisition and ownership of shares of the Company’s common stock.

Transfer Restrictions in the Company’s Charter

Subject to exceptions specified therein, the Company’s charter provides that no holder may own, either actually or constructively under the applicable constructive ownership provisions of the Code, more than 7.0%, by number of shares or value, whichever is more restrictive, of the outstanding shares of the Company’s common stock.

In addition, because rent from tenants in which we actually or constructively own a 10% or greater interest is not qualifying rent for purposes of the gross income tests under the Code, the Company’s charter provides that no holder may own, either actually or constructively by virtue of the constructive ownership provisions of the Code, which differ from the constructive ownership provisions used for purposes of the preceding sentence, more than 9.8%, by number of shares or value, whichever is more restrictive, of the outstanding shares of the Company’s common stock.

We refer to the limits described in the two preceding paragraphs, together, as the “ownership limits.”

The constructive ownership provisions set forth in the Code are complex, and may cause shares of the Company’s common stock owned actually or constructively by a group of related individuals and/or entities to be constructively owned by one individual or entity. As a result, the acquisition of shares of the Company’s common stock in an amount that does not exceed the ownership limits, or the acquisition of an interest in an entity that actually or constructively owns the Company’s common stock, could, nevertheless cause that individual or entity, or another individual or entity, to own constructively shares in excess of the ownership limits and thus violate the ownership limits described above or otherwise permitted by the Company’s board of directors.

The Company’s charter permits the board of directors to waive the ownership limits with respect to a particular common stockholder if the board of directors, among other things:

•determines that such waiver will not cause any individual’s beneficial ownership of shares of the Company’s common stock to violate the 7.0% limitation described above or that any exemption from such ownership limit will not cause the Company to fail to qualify as a REIT; and

•determines that such stockholder does not and will not own, actually or constructively, an interest in a tenant of the Company (or a tenant of any entity owned in whole or in part by the Company) that would cause the Company to own, actually or constructively, more than a 9.8% interest (as set forth in Section 856(d)(2)(B) of the Code) in such tenant, subject to certain exceptions.

As a condition of this waiver, the Company’s board of directors may require opinions of counsel satisfactory to it and/or undertakings or representations from the applicant with respect to preserving the Company’s REIT status. The board of directors has waived the ownership limit applicable to the Company’s common stock forJohn B. Kilroy, Sr. and John Kilroy, members of their families and some of their affiliated entities, allowing them to own up to 19.6% of the Company’s common stock. However, the board of directors conditioned this waiver upon the receipt of undertakings and representations from Messrs. Kilroy which it believed were reasonably necessary to conclude that the waiver would not cause us to fail to qualify and maintain the Company’s status as a REIT.

In addition to the foregoing ownership limits, the Company’s charter provides that no holder may own, either actually or constructively under the applicable attribution rules of the Code, any shares of the Company’s common stock if, as a result of this ownership:

•more than 50% in value of the Company’s outstanding common stock would be owned, either actually or constructively under the applicable constructive ownership provisions of the Code, by five or fewer individuals, as defined in the Code; or

•the Company would fail to qualify as a REIT.

If shares of common stock are transferred to any person in a manner which result in the Company’s capital stock being beneficially owned by less than 100 persons (determined without reference to any rules of attribution), the Company’s charter provides that the transfer shall be null and void in its entirety, and the intended transferee will acquire no rights in such common stock.

Under the Company’s charter, any person who acquires or attempts or intends to acquire actual or constructive ownership of the Company’s shares of common stock that violate any of the foregoing restrictions on transferability and ownership must give us notice immediately and provide us with any other information that we may request to determine the effect of the transfer on the Company’s status as a REIT. The foregoing restrictions on transferability and ownership will not apply if the Company’s board of directors determines that it is no longer in the Company’s best interest to attempt to qualify, or to continue to qualify, as a REIT and such determination is approved by the affirmative vote of holders of at least two-thirds of the shares of the Company’s capital stock outstanding and entitled to vote thereon.

The terms of any class or series of preferred stock that we may issue in the future may include restrictions on ownership and transfer, and provide for exceptions to or waivers of those restrictions, similar to those described under this caption “—Transfer Restrictions in the Company’s Charter,” as well as remedies for violation of those restrictions similar to those described below under “—Effect of Violation of Ownership Limits and Transfer Restrictions.”

Effect of Violation of Ownership Limits and Transfer Restrictions

The Company’s charter provides that if any transfer or other event occurs that, if effective, would result in any person owning shares of Company’s common stock in violation of the ownership limits or other restrictions on ownership and transfer of our stock described above, the number of shares of common stock that otherwise would cause such person to violate the ownership limits or other restrictions on ownership and transfer of our stock (the

“excess shares”) will be transferred automatically to a trust, the beneficiary of which will be a qualified charitable organization selected by us or, if for any reason that transfer is not automatically effective, then the transfer of such excess shares shall be void ab initio and the purported transferee will not have any rights in such excess shares. The automatic transfer will be effective as of the close of business on the business day prior to the date of the violative transfer.

The trustee of the charitable trust must:

•within 20 days of receiving notice from us of the transfer of excess shares to the trust,

◦sell the excess shares to a person or entity who could own the shares without violating the ownership limits or as otherwise permitted by the board of directors, and

◦distribute to the prohibited transferee or owner, as applicable, an amount equal to the lesser of the price paid by the prohibited transferee or owner for the excess shares (or, if the event which resulted in the transfer to the charitable trust did not involve a purchase of the applicable stock for fair value, the market price of such shares on the day of the event which resulted in such transfer to the charitable trust) or the sales proceeds (net any commissions and other expenses of sale) received by the trust for the excess shares; and   

•distribute any proceeds in excess of the amount distributable to the prohibited transferee or owner, as applicable, to the charitable organization selected by us as beneficiary of the trust.

Excess shares transferred to the charitable trust shall be deemed to have been offered for sale to us at a price per share equal to the lesser of the price paid by the prohibited transferee or owner for the excess shares (or, if the event which resulted in the transfer to the charitable shares did not involve the purchase of the applicable stock for fair value, the market price of such shares on the day of the event which resulted in the transfer of such shares to the charitable trust) and the market price on the date we accept such offer. We will have the right to accept such offer until the charitable trust has sold the excess shares as described above.

The trustee shall be designated by us and be unaffiliated with us and any prohibited transferee or owner. Prior to a sale of any excess shares by the trust, the trustee will receive, in trust for the beneficiary, all dividends and other distributions paid by us with respect to the excess shares, and may also exercise all voting rights with respect to the excess shares.

The Company’s charter provides that, subject to Maryland law, effective as of the date that the shares have been transferred to the trust, the trustee shall have the authority, at the trustee’s sole discretion:

•to rescind as void any vote cast by a prohibited transferee or owner, as applicable, prior to our discovery that the Company’s shares have been transferred to the trust; and

•to recast the vote in accordance with the desires of the trustee acting for the benefit of the beneficiary of the trust.

However, if we have already taken irreversible corporate action, then the trustee may not rescind and recast the vote. Any dividend or other distribution paid to the prohibited transferee or owner, prior to our discovery that the shares had been automatically transferred to a trust as described above, must be repaid to the trustee upon demand for distribution to the beneficiary of the trust. If the transfer to the trust as described above is not automatically effective, for any reason, to prevent violation of the applicable ownership limit or as otherwise permitted by the board of directors, then the Company’s charter provides that the transfer of the excess shares will be void ab initio.

If the Company’s board of directors shall at any time determine in good faith that a person has acquired, intends to acquire or own, has attempted to acquire or own, or may acquire or own the Company’s common stock in violation of the limits described above, the Company’s charter provides that the board of directors shall take actions to refuse to give effect to or to prevent the ownership or acquisition, including, but not limited to:

•authorizing us to repurchase stock;

•refusing to give effect to the ownership or acquisition on our books; or

•instituting proceedings to enjoin the ownership or acquisition.

All certificates representing shares of the Company’s capital stock bear a legend referring to the restrictions described above.

All persons who own at least a specified percentage of the issued and outstanding shares of the Company’s stock must file with us a completed questionnaire annually containing information about their ownership of the shares, as set forth in the applicable Treasury regulations. Under current Treasury regulations, the percentage is between 0.5% and 5.0%, depending on the number of record holders of the Company’s shares. In addition, each stockholdermay be required to disclose to us in writing information about the actual and constructive ownership of the Company’s shares as the board of directors deems necessary to comply with the provisions of the Code applicable to a REIT or to comply with the requirements of any taxing authority or governmental agency.

These ownership limitations could discourage a takeover or other transaction in which holders of some, or a majority, of the Company’s shares of capital stock might receive a premium for their shares over the then prevailing market price or which stockholders might believe to be otherwise in their best interest.

Certain Provisions of the Maryland General Corporation Law and of the Company’s Charter and Bylaws

Under the Maryland General Corporation Law, or the MGCL, the Company’s stockholders are generally not liable for our debts or obligations. In the event of the voluntary or involuntary liquidation, dissolution or winding-up of the Company, we will first pay all debts and other liabilities, including debts and liabilities arising out of the Company’s status as general partner of the operating partnership, and, second, any preferential distributions on any issued and outstanding shares of our preferred stock, if any. Each holder of the Company’s common stock then will share ratably in our remaining assets. All shares of the Company’s common stock have equal distribution, liquidation and voting rights, and have no preference or exchange rights, subject to the transfer and ownership limits in the Company’s charter or as permitted by the board of directors pursuant to executed agreements waiving these ownership limits with respect to specific stockholders.

Under the MGCL, we generally require approval by the Company’s stockholders by the affirmative vote of at least two-thirds of the votes entitled to vote before we can:

 authorizing us to repurchase stock;

•dissolve;

•amend the Company’s charter (except for limited exceptions);

•merge;

•sell all or substantially all of the Company’s assets;

•engage in a share exchange; or

•engage in similar transactions outside the ordinary course of business.

Under the MGCL and our charter, the board of directors may, without stockholder approval, make certain minor amendments to the charter, and if the charter allows, which ours does, classify or reclassify any unissued stock from time to time by setting or changing the preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends, qualifications, or terms or conditions of redemption of the stock.

With respect to the sale of all or substantially all of the Company’s assets, because the term “substantially all” of a company’s assets is not defined in the MGCL, it is subject to Maryland common law and to judicial interpretation and review in the context of the unique facts and circumstances of any particular transaction.

Although the MGCL allows the Company’s charter to establish a lesser percentage of affirmative votes by the Company’s stockholders for approval of those actions, the Company’s charter does not include such a provision.

The Board of Directors

The Company’s charter provides that the number of the directors shall be six directors until that number is increased or decreased in accordance with the bylaws of the Company; provided, however, such number cannot be less than the minimum number required by the MGCL, which is one. The Company’s bylaws allow the board of directors to fix or change the number to not fewer than three and not more than 13 members. The number of directors is currently fixed at six. A majority of the remaining board of directors may fill any vacancy, other than a vacancy caused by removal. A majority of the board of directors may fill a vacancy resulting from an increase in the number of directors. The stockholders entitled to vote for the election of directors at an annual or special meeting of the Company’s stockholders may fill a vacancy resulting from the removal of a director.

The Company’s charter and bylaws provide that a majority of the board of directors must be “independent directors.” An “independent director” is a director who is not:

•an employee, officer or affiliate of us or one of our subsidiaries or divisions;

•a relative of a principal executive officer; or

•an individual member of an organization acting as advisor, consultant or legal counsel, who receives compensation on a continuing basis from us in addition to director’s fees.

No Cumulative Voting

Holders of shares of Company common stock have no right to cumulative voting for the election of directors. Consequently, at each annual meeting of the Company’s stockholders, the holders of a majority of the shares of Company common stock entitled to vote will be able to elect all of the successors of the directors at that meeting.

Removal of Directors

The Company’s charter provides that its stockholders may remove a director only for “cause” and only by the affirmative vote of at least two-thirds of the shares entitled to vote in the election of directors. The MGCL does not define the term “cause.” As a result, removal for “cause” is subject to Maryland common law and to judicial interpretation and review in the context of the unique facts and circumstances of any particular situation.

Election of Directors

The Company’s bylaws provide a majority vote standard for uncontested elections of directors. As a result, except in the case of directors to be elected by the holders of any class or series of the Company’s preferred stock, at each meeting of stockholders at which the election of directors is uncontested, a director nominee will be elected to the board of directors only if the number of votes cast “FOR” the nominee exceeds the number of votes cast “AGAINST” the nominee (with abstentions and broker non-votes not counted as a vote cast either “FOR” or “AGAINST” the director nominee). A plurality vote standard applies in contested elections, in which case stockholders will not be permitted to vote “AGAINST” any director nominee but will only be permitted to vote “FOR” or withhold their vote with respect to such nominee. An election will be considered to be contested if the Company’s secretary has received notice that a stockholder or group of stockholders has nominated or proposes to nominate one or more persons for election as a director, such notice purports to be in compliance with the advance notice requirements or the proxy access requirements set forth in the Company’s bylaws, and, at least 14 days prior to the date on which notice of the meeting is first mailed to stockholders, the nomination has not been withdrawn and would thereby cause the number of director nominees to exceed the number of directors to be elected at the meeting.

Under the MGCL, if an incumbent director is not re-elected at a meeting of stockholders at which he or she stands for re-election in an uncontested election, then the incumbent director continues to serve in office as a holdover director until his or her successor is elected and qualifies. However, the Company’s bylaws provide that if an incumbent director is not re-elected due to his or her failure to receive a majority of the votes cast in an uncontested election, the director will promptly tender his or her resignation as a director, subject to acceptance by the board of directors, for consideration by the nominating and corporate governance committee of the board of directors. The nominating and corporate governance committee of the board of directors will then make a recommendation to the board of directors as to whether to accept or reject the tendered resignation or whether other action should be taken. The board of directors will publicly disclose within 90 days of certification of the stockholder vote its decision and rationale regarding whether to accept, reject or take other action with respect to the tendered resignation. If a director’s tendered resignation is not accepted by the board of directors, such director would continue to serve until the next annual meeting of stockholders and until his or her successor is elected and qualified or his or her earlier death, retirement, resignation or removal. If a director’s tendered resignation is accepted, then the board of directors may, among other things, fill the resulting vacancy or decrease the size of the board of directors.

The Company is not Subject to the Maryland Business Combination Act

The Company has elected not to be subject to the “business combination” provisions of the MGCL (Sections 3-601 through 3-605) pursuant to the board of directors’ adoption of certain resolutions related thereto. Such resolutions also provide that the board of directors cannot rescind such election and become subject to these business combination provisions without the approval of holders of a majority of its shares entitled to vote.

In the event that the Company decides to be subject to the business combinations provision, “business combinations” between a Maryland corporation and an interested stockholder or an affiliate of an interested stockholder are generally prohibited for five years after the most recent date on which the interested stockholder becomes an interested stockholder. A business combination includes a merger, consolidation or share exchange. A business combination may also include an asset transfer or issuance or reclassification of equity securities. An interested stockholder is defined in the MGCL as:

•any person (other than the corporation or any subsidiary) who beneficially owns, directly or indirectly, ten percent or more of the voting power of the corporation’s shares; or

•an affiliate or associate of the corporation who, at any time within the two-year period prior to the date in question, was the beneficial owner, directly or indirectly, of ten percent or more of the voting power of the then outstanding stock of the corporation.

A person is not an interested stockholder under the business combinations provisions of the MGCL if the board of directors approved in advance the transaction by which such person would otherwise have become an interested stockholder.

At the conclusion of the five-year prohibition, any business combination between the Maryland corporation and an interested stockholder generally must be recommended by the board of directors of the corporation and approved by the affirmative vote of at least:

•80% of the votes entitled to be cast by holders of outstanding shares of voting stock of the corporation; and

•two-thirds of the votes entitled to be cast by holders of voting stock of the corporation other than shares held by the interested stockholder with whom or with whose affiliate the business combination is to be effected or held by an affiliate or associate of the interested stockholder.

These super-majority vote requirements do not apply if the corporation’s common stockholders receive a minimum price, as defined under the MGCL, for their shares in the form of cash or other consideration in the same form as previously paid by the interested stockholder for its shares. None of these provisions of the MGCL will apply, however, to business combinations that are approved or exempted by the board of directors of the corporation prior to the time that the interested stockholder becomes an interested stockholder.

As a result of the Company’s decision not to be subject to the business combinations statute, an interested stockholder would be able to effect a “business combination” without complying with the requirements discussed above, which may make it easier for stockholders who become interested stockholders to consummate a business combination involving the Company. However, the Company cannot assure you that any business combinations will be consummated or, if consummated, will result in a purchase of shares of capital stock from its stockholders at a premium.

The Company is not Subject to the Maryland Control Share Acquisition Act

The Company has elected in its bylaws not to be subject to the “control share acquisition” provisions of the MGCL (Sections 3-701 through 3-710). If it wants to be subject to these provisions, its bylaws would need to be amended. Such amendments would require the approval of the holders of a majority of all votes entitled to be cast by the holders of the issued and outstanding shares of the Company’s common stock.

The MGCL provides that “control shares” of a company acquired in a “control share acquisition” have no voting rights except to the extent approved by a vote of two-thirds of the votes entitled to vote, excluding shares owned by the acquiror or by officers or directors who are employees of the Company. “Control shares” are voting shares of stock which, if aggregated with all other voting shares of stock previously acquired by the acquiror, or over which the acquiror is able to directly or indirectly exercise voting power, except solely by revocable proxy, would entitle the acquiror to exercise voting power in electing directors within one of the following ranges of voting power:

•one-tenth or more but less than one-third;

•one-third or more but less than a majority; or

•a majority or more of all voting power.

“Control shares” do not include shares of stock the acquiring person is entitled to vote having obtained prior stockholder approval. Generally, “control share acquisition” means the acquisition of control shares.

A person who has made or proposes to make a control share acquisition may compel the board of directors to call a special meeting of stockholders to consider voting rights for the shares. The meeting must be held within 50 days of demand. If no request for a meeting is made, the Company may present the question at any stockholders’ meeting.

If voting rights are not approved at the meeting or if the acquiring person does not deliver an acquiring person statement as required by the statute, then, subject to conditions and limitations, the corporation may redeem any or all of the control shares, except those for which voting rights previously have been approved, for fair value. Fair value is determined without regard to the absence of voting rights for control shares, as of the date of the last control share acquisition or of any meeting of stockholders at which the voting rights of control shares are considered and not approved. If voting rights for control shares are approved at a stockholders meeting and the acquiror becomes entitled to vote a majority of the shares entitled to vote, all other stockholders may exercise appraisal rights. The fair value of the shares as determined for purposes of these appraisal rights may not be less than the highest price per share paid in the control share acquisition. Limitations and restrictions otherwise applicable to the exercise of dissenters’ rights do not apply in the context of a control share acquisition.

The control share acquisition statute does not apply to shares acquired in a merger, consolidation or share exchange if the company is a party to the transaction, or to acquisitions approved or exempted by its charter or bylaws. Because the Company is not subject to these provisions, stockholders who acquire a substantial block of Company common stock do not need approval of the other stockholders before exercising full voting rights with respect to their shares on all matters. This may make it easier for any of these control share stockholders to effect a business combination with the Company. However, the Company cannot assure you that any business combinations will be consummated or, if consummated, will result in a purchase of shares of Company common stock from any stockholder at a premium.

Unsolicited Takeovers

Under certain provisions of the MGCL relating to unsolicited takeovers, a Maryland corporation with a class of equity securities registered under the Exchange Act and at least three independent directors may elect to be subject, in whole or in part, to certain statutory provisions relating to unsolicited takeovers which, among other things, would automatically classify the board of directors into three classes with staggered terms of three years each, require two-thirds of all the votes entitled to be cast by the stockholders generally in the election of directors for the removal of a director, vest in its board of directors the exclusive right to determine the number of directors and the exclusive right, by the affirmative vote of a majority of the remaining directors, to fill vacancies on the board of directors, even if the remaining directors do not constitute a quorum and require that a special meeting of stockholders be called at the request of the stockholders only if requested by stockholders entitled to cast a majority of the votes entitled to be cast at the meeting. These statutory provisions also provide that any director elected to fill a vacancy shall hold office for the remainder of the full term of the class of directors in which the vacancy occurred, rather than the next annual meeting of directors as would otherwise be the case, and until his successor is elected and qualified.

An election to be subject to any or all of the foregoing statutory provisions may be made in the Company’s charter or bylaws, or by resolution of the board of directors without the need for stockholder approval. Any such statutory provision to which the Company elects to be subject will apply even if other provisions of the Company’s charter or bylaws provide to the contrary, unless the charter or a resolution adopted by the board of directors prohibits such election.

If the Company made an election to be subject to the statutory provisions described above, the board of directors would automatically be classified into three classes with staggered terms of office of three years each, and would have the exclusive right to determine the number of directors and the exclusive right to fill vacancies on the board of directors. Moreover, any director elected to fill a vacancy would hold office for the remainder of the full term of the class of directors in which the vacancy occurred.

In such instance, the classification and staggered terms of office of the directors would make it more difficult for a third party to gain control of the board of directors since at least two annual meetings of stockholders, instead of one, generally would be required to effect a change in the majority of the board of directors.

The Company has not elected to become subject to the foregoing statutory provisions relating to unsolicited takeovers. However, the Company could by resolutions adopted by the board of directors and without stockholder approval, elect to become subject to some or all of these statutory provisions.

Amendment of the Company’s Charter and Bylaws

The Company’s charter may generally be amended only if the amendment is declared advisable by the board of directors and approved by our stockholders by the affirmative vote of at least two-thirds of the shares entitled to vote on the amendment. The Company’s bylaws generally may be amended by the affirmative vote of a majority of the board of directors or of a majority of all votes entitled to be cast by the holders of the issued and outstanding shares of common stock of the Company. However, the following bylaw provisions may be amended only by the approval of a majority of all votes entitled to be cast by the holders of the issued and outstanding shares of common stock of the Company:

•provisions opting out of the control share acquisition statute;

•provisions requiring approval by the independent directors for selection of operators of our properties or of transactions involving John B. Kilroy, Sr. and John Kilroy and their affiliates; and

•provisions governing amendment of the Company’s bylaws.

Meetings of Stockholders

The Company’s bylaws provide for annual meetings of its stockholders to elect directors and to transact other business properly brought before the meeting. In addition, a special meeting of stockholders may be called by:

•the president;

•the board of directors pursuant to a resolution approved by a majority of the entire board of directors;

•the chairman of the board; and

•the secretary of the Company following, his or her receipt of one or more written demands to call a special meeting of stockholders by holders of at least a majority of the Company’s issued and outstanding common stock entitled to vote by making a written request.

The MGCL provides that the Company’s stockholders also may act by unanimous written consent without a meeting with respect to any action that they are required or permitted to take at a meeting. To do so, each stockholder entitled to vote on the matter must sign the consent setting forth the action.

Advance Notice of Director Nominations and New Business Proposals

The Company’s bylaws provide that with respect to an annual meeting of stockholders, nominations of persons for election to the board of directors and the proposal of other business to be considered by stockholders at the meeting may be made only:

•pursuant to the Company’s notice of the meeting;

•by or at the direction of the board of directors; or

•by a stockholder who is entitled to vote at the meeting and has complied with the advance notice procedures of the Company’s bylaws.

The Company’s bylaws also provide that with respect to special meetings of stockholders, only the business specified in the notice of meeting may be brought before the meeting.

The advance notice provisions of the Company’s bylaws could have the effect of discouraging a takeover or other transaction in which holders of some, or a majority, of the shares of common stock might receive a premium

for their shares over the then prevailing market price or which holders of the Company’s common stock believe is in their best interests.

Proxy Access

The Company’s bylaws permit a stockholder, or group of up to twenty stockholders, owning at least 3% of the Company’s issued and outstanding common stock continuously for at least the prior three years to nominate a candidate for election to the board of directors and inclusion in the Company’s proxy materials for its annual meeting of stockholders; provided that the total number of all stockholder nominees included in the Company’s proxy materials shall not exceed 25% of the number of directors then serving on the board of directors. The foregoing proxy access right is subject to additional eligibility, procedural and disclosure requirements set forth in the Company’s bylaws.

Exclusive Forum for Certain Litigation

The Company’s bylaws provide that, unless the Company consents in writing to the selection of an alternative forum, the Circuit Court for Baltimore City, Maryland, or, if that court does not have jurisdiction, the United States District Court for the District of Maryland, Baltimore Division, shall be the sole and exclusive forum for:

•any derivative action or proceeding brought on behalf of the Company;

•any action asserting a claim of breach of any duty owed by any present or former director or officer or other employee or stockholder of the Company to the Company or the Company’s stockholders or any standard of conduct applicable to the directors of the Company;

•any action asserting a claim against the Company or any present or former director or officer or other employee of the Company arising pursuant to any provision of the MGCL, the Company’s charter or bylaws (in each case, as the same may be amended from time to time); or

•any action asserting a claim against the Company or any present or former director or officer or other employee of the Company governed by the internal affairs doctrine.

Dissolution of the Company

Under the MGCL, the Company may be dissolved if a majority of the entire board of directors declares by resolution that dissolution is advisable and submits a proposal for dissolution for consideration at any annual or special meeting of stockholders, and this proposal is approved, by the vote of the holders of two-thirds of the shares of the Company’s capital stock entitled to vote on the dissolution.

Indemnification and Limitation of Liability of Directors and Officers

The Company’s charter and bylaws, and the partnership agreement, provide for indemnification of its officers and directors against liabilities to the fullest extent permitted by the MGCL, as amended from time to time.

The MGCL permits the Company to indemnify its present and former directors and officers and other parties against judgments, penalties, fines, settlements, and reasonable expenses actually incurred by them in connection with any proceeding to which they may be made or threatened to be made a party to, or witness in, by reason of their service in those or other capacities unless it is established that:

•the act or omission of the director or officer was material to the matter giving rise to the proceeding and was committed in bad faith or was the result of active and deliberate dishonesty;

•the director or officer actually received an improper personal benefit in money, property or services; or

•in the case of any criminal proceeding, the director or officer had reasonable cause to believe that the act or omission was unlawful.

If the proceeding is one by the Company or in its right, indemnification may not be made in respect of any proceeding in which the director or officer has been found to be liable to the Company. In addition, the Company may not indemnify a director or officer in any proceeding charging improper personal benefit to them if they were

found to be liable on the basis that personal benefit was received. The termination of any proceeding by judgment, order or settlement does not create a presumption that the director or officer did not meet the requisite standard of conduct required for indemnification to be permitted. The termination of any proceeding by conviction, or upon a plea of nolo contendere or its equivalent, or an entry of any order of probation prior to judgment, creates a rebuttable presumption that the director or officer did not meet the requisite standard of conduct required for indemnification to be permitted.

In addition, the MGCL provides that, unless limited by its charter, a corporation shall indemnify any present or former director or officer who is made a party to any proceeding by reason of service in that capacity against reasonable expenses incurred by the director or officer in connection with the proceeding, in the event that the director or officer is successful, on the merits or otherwise, in the defense of the proceeding. The Company’s charter contains no such limitation.

As permitted by the MGCL, the Company’s charter limits the liability of its directors and officers to the Company and its stockholders for money damages, subject to specified restrictions. However, the liability of the Company’s directors and officers to it and its stockholders for money damages is not limited if:

•it is proved that the director or officer actually received an improper benefit or profit in money, property or services; or

•a judgment or other final adjudication adverse to the director or officer is entered in a proceeding based on a finding that the director’s or officer’s action, or failure to act, was the result of active and deliberate dishonesty and was material to the cause of action adjudicated in the proceeding.

This provision does not limit the Company’s ability or its stockholders’ ability to obtain other relief, such as an injunction or rescission.

The partnership agreement provides that the Company, as general partner, and its officers and directors are indemnified to the same extent its officers and directors are indemnified in its charter. The partnership agreement limits the Company’s liability and the liability of its officers and directors to the operating partnership and its partners to the same extent that its charter limits the liability of its officers and directors to it and its stockholders. See “Description of Material Provisions of the Partnership Agreement of Kilroy Realty, L.P.-Indemnification of the Company’s Officers and Directors.”

Insofar as the foregoing provisions permit indemnification of directors, officers or persons controlling the Company for liability arising under the Securities Act of 1933, as amended, the Securities Act, the Company has been informed that in the opinion of the SEC, this indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

Anti-takeover Effect of Certain Provisions of the MGCL and of the Company’s Charter and Bylaws

If the resolution of the board of directors exempting the Company from the business combination provisions of the MGCL and the applicable provision in its bylaws exempting it from the control share acquisition provisions of the MGCL are rescinded or revoked (which in each case would require stockholder approval) or it elects to be subject to the unsolicited takeover provisions of the MGCL, then the business combination, control share acquisition and unsolicited takeover provisions of the MGCL, the provisions of its charter on removal of directors, the advance notice provisions of its bylaws and certain other provisions of its charter and bylaws and the MGCL could delay, deter or prevent a change of control of the Company or other transactions that might involve a premium price for holders of its capital stock or otherwise be in their best interest.

Transfer Agent and Registrar for Shares of Capital Stock

Computershare Shareowner Services LLC is the transfer agent and registrar for shares of the Company’s common stock.

EX-21.1

Exhibit 21.1

SUBSIDIARIES OF KILROY REALTY CORPORATION

NAME OF SUBSIDIARY OR ORGANIZATION	STATE OF INCORPORATION OR FORMATION
Kilroy Realty, L.P.	Delaware
Kilroy Realty Finance, Inc.	Delaware
Kilroy Realty Finance Partnership, L.P.	Delaware
Kilroy Services, LLC	Delaware
Kilroy Realty TRS, Inc.	Delaware
Kilroy Realty Management, L.P.	Delaware
Kilroy Realty 303, LLC	Delaware
KR Westlake Terry, LLC	Delaware
KR 6255 Sunset, LLC	Delaware
KR MML 12701, LLC	Delaware
KR 690 Middlefield, LLC	Delaware
KR Lakeview, LLC	Delaware
KR Tribeca West, LLC	Delaware
KR 331 Fairchild, LLC	Delaware
KR Hollywood, LLC	Delaware
KR 350 Mission, LLC	Delaware
Fremont Lake Union Center, LLC	Delaware
KR 555 Mathilda, LLC	Delaware
KR Redwood City Member, LLC	Delaware
Redwood City Partners, LLC	Delaware
KR Vine, LLC	Delaware
KR 401 Terry, LLC	Delaware
KR Mission Bay, LLC	Delaware
KR Flower Mart, LLC	Delaware
KR SFFGA, LLC	Delaware
KR CFM, Inc.	California
KR 333 Dexter, LLC	Delaware
KR 330 Dexter, LLC	Delaware
KR 400 Aurora, LLC	Delaware
KR 401 Dexter, LLC	Delaware
KR 100 Hooper, LLC	Delaware
100 First Street Member, LLC	Delaware
KR 100 First Street Owner, LLC	Delaware
201 Third Street Member, LLC	Delaware
KR 201 Third Street Owner, LLC	Delaware
303 Second Street Member, LLC	Delaware
KR 303 Second Street Owner, LLC	Delaware
KR Terra Bella, LLC	Delaware
KR Menlo Park, LLC	Delaware
KR WMC, LLC	Delaware
KR 501 Santa Monica, LLC	Delaware
KR 12400 High Bluff, LLC	Delaware
KR Sunset Weho, LLC	Delaware
KR 1701 Page Mill, LLC	Delaware
KR Oyster Point Developer, LLC	Delaware
KR Crescent Beach, LLC	Delaware
KR Kettner, LLC	Delaware
Oyster Cove Marina Owner, LLC	Delaware
Oyster Cove Marina Owner Member, LLC	Delaware

KR OP Tech, LLC	Delaware
KR North PCH, LLC	Delaware
Kilroy Realty TRS 2, Inc.	Delaware
KR Oyster Point I, LLC	Delaware
KR Oyster Point II, LLC	Delaware
KR Oyster Point III, LLC	Delaware
Kilroy Realty TRS 3, Inc.	Delaware
KR 6th Ave, LLC	Delaware
KR 901 Park, LLC	Delaware
KR 1335 Broadway, LLC	Delaware
KR 1825 7th Ave, LLC	Delaware
KR Blackwelder, LLC	Delaware
KR Blackwelder Lessee, LLC	Delaware
KR Boardman, LLC	Delaware
901 16th St, LLC	Delaware
901 16th St Manager, LLC	Delaware
901 16th St Member, LLC	Delaware
KR Manager, LLC	Delaware
Kilroy Realty TRS 4, Inc.	Delaware
KR 303 Second Street TRS, LLC	Delaware

EX-21.2

Exhibit 21.2

SUBSIDIARIES OF KILROY REALTY, L.P.

NAME OF SUBSIDIARY OR ORGANIZATION	STATE OF INCORPORATION OR FORMATION
Kilroy Services, LLC	Delaware
Kilroy Realty Finance Partnership, L.P.	Delaware
Kilroy Realty TRS, Inc.	Delaware
Kilroy Realty Management, L.P.	Delaware
Kilroy Realty 303, LLC	Delaware
KR Westlake Terry, LLC	Delaware
KR 6255 Sunset, LLC	Delaware
KR MML 12701, LLC	Delaware
KR 690 Middlefield, LLC	Delaware
KR Lakeview, LLC	Delaware
KR Tribeca West, LLC	Delaware
KR 331 Fairchild, LLC	Delaware
KR Hollywood, LLC	Delaware
KR 350 Mission, LLC	Delaware
Fremont Lake Union Center, LLC	Delaware
KR 555 Mathilda, LLC	Delaware
KR Redwood City Member, LLC	Delaware
Redwood City Partners, LLC	Delaware
KR Vine, LLC	Delaware
KR 401 Terry, LLC	Delaware
KR Mission Bay, LLC	Delaware
KR Flower Mart, LLC	Delaware
KR SFFGA, LLC	Delaware
KR 333 Dexter, LLC	Delaware
KR 330 Dexter, LLC	Delaware
KR 400 Aurora, LLC	Delaware
KR 401 Dexter, LLC	Delaware
KR 100 Hooper, LLC	Delaware
100 First Street Member, LLC	Delaware
KR 100 First Street Owner, LLC	Delaware
201 Third Street Member, LLC	Delaware
KR 201 Third Street Owner, LLC	Delaware
303 Second Street Member, LLC	Delaware
KR 303 Second Street Owner, LLC	Delaware
KR Terra Bella, LLC	Delaware
KR Menlo Park, LLC	Delaware
KR WMC, LLC	Delaware
KR 501 Santa Monica, LLC	Delaware
KR 12400 High Bluff, LLC	Delaware
KR Sunset Weho, LLC	Delaware
KR 1701 Page Mill, LLC	Delaware
KR Oyster Point Developer, LLC	Delaware
KR Crescent Beach, LLC	Delaware
KR Kettner, LLC	Delaware
Oyster Cove Marina Owner, LLC	Delaware
Oyster Cove Marina Owner Member, LLC	Delaware
KR OP Tech, LLC	Delaware
KR North PCH, LLC	Delaware
Kilroy Realty TRS 2, Inc.	Delaware

KR Oyster Point I, LLC	Delaware
KR Oyster Point II, LLC	Delaware
KR Oyster Point III, LLC	Delaware
KR Boardman, LLC	Delaware
Kilroy Realty TRS 3, Inc.	Delaware
KR 901 Park, LLC	Delaware
KR 1335 Broadway, LLC	Delaware
KR Blackwelder, LLC	Delaware
KR Blackwelder Lessee, LLC	Delaware
KR 1825 7th Ave, LLC	Delaware
KR 6th Ave, LLC	Delaware
901 16th St, LLC	Delaware
901 16th St Member, LLC	Delaware
901 16th St Manager, LLC	Delaware
KR Manager, LLC	Delaware
Kilroy Realty TRS 4, Inc.	Delaware
KR 303 Second Street TRS, LLC	Delaware

EX-23.1

Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the incorporation by reference in Registration Statement No. 333-233822 on Form S-3 and Registration Statement No. 333-239809 on Form S-8 of our reports dated February 12, 2021, relating to the financial statements of Kilroy Realty Corporation and the effectiveness of Kilroy Realty Corporation’s internal control over financial reporting, appearing in this Annual Report on Form 10-K of Kilroy Realty Corporation and Kilroy Realty, L.P. for the year ended December 31, 2020.

/s/ DELOITTE & TOUCHE LLP

Los Angeles, California

February 12, 2021

EX-23.2

Exhibit 23.2

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the incorporation by reference in Registration Statement No. 333-233822-01 on Form S-3 of our reports dated February 12, 2021, relating to the financial statements of Kilroy Realty, L.P. and the effectiveness of Kilroy Realty, L.P.’s internal control over financial reporting, appearing in this Annual Report on Form 10-K of Kilroy Realty, L.P. and Kilroy Realty Corporation for the year ended December 31, 2020.

/s/ DELOITTE & TOUCHE LLP

Los Angeles, California

February 12, 2021

EX-31.1

Exhibit 31.1

Certification of Chief Executive Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, John Kilroy, certify that:

1.I have reviewed this annual report on Form 10-K of Kilroy Realty Corporation;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s Board of Directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ John Kilroy

John Kilroy

Chief Executive Officer

Date: February 12, 2021

EX-31.2

Exhibit 31.2

Certification of Chief Financial Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Michelle Ngo, certify that:

1.I have reviewed this annual report on Form 10-K of Kilroy Realty Corporation;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s Board of Directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ Michelle Ngo

Michelle Ngo

Senior Vice President, Chief Financial Officer and Treasurer

Date: February 12, 2021

EX-31.3

Exhibit 31.3

Certification of Chief Executive Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, John Kilroy, certify that:

1.I have reviewed this annual report on Form 10-K of Kilroy Realty, L.P.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s Board of Directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ John Kilroy

John Kilroy

Chief Executive Officer

Kilroy Realty Corporation, sole general partner of
Kilroy Realty, L.P.

Date: February 12, 2021

EX-31.4

Exhibit 31.4

Certification of Chief Financial Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Michelle Ngo, certify that:

1.I have reviewed this annual report on Form 10-K of Kilroy Realty, L.P.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's Board of Directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

/s/ Michelle Ngo

Michelle Ngo

Senior Vice President, Chief Financial Officer and Treasurer

Kilroy Realty Corporation, sole general partner of
Kilroy Realty, L.P.

Date: February 12, 2021

EX-32.1

Exhibit 32.1

Certification of Chief Executive Officer

Pursuant to 18 U.S.C. § 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officer of Kilroy Realty Corporation (the “Company”) hereby certifies, to his knowledge, that:

(i)the accompanying Annual Report on Form 10-K of the Company for the year ended December 31, 2020 (the “Report”) fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

(ii)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ John Kilroy
John Kilroy
Chief Executive Officer
Date:	February 12, 2021

The foregoing certification is being furnished solely pursuant to 18 U.S.C. § 1350, is not being filed as part of the Report or as a separate disclosure document, and is not being incorporated by reference into any filing of the Company or Kilroy Realty, L.P. under the Securities Act of 1933, as amended, or the Securities Act of 1934, as amended, (whether made before or after the date of the Report) irrespective of any general incorporation language contained in such filing. The signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2

Exhibit 32.2

Certification of Chief Financial Officer

Pursuant to 18 U.S.C. § 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officer of Kilroy Realty Corporation (the “Company”) hereby certifies, to his knowledge, that:

(i)the accompanying Annual Report on Form 10-K of the Company for the year ended December 31, 2020 (the “Report”) fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

(ii)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Michelle Ngo
Michelle Ngo
Senior Vice President, Chief Financial Officer and Treasurer
Date:	February 12, 2021

The foregoing certification is being furnished solely pursuant to 18 U.S.C. § 1350, is not being filed as part of the Report or as a separate disclosure document, and is not being incorporated by reference into any filing of the Company or Kilroy Realty, L.P. under the Securities Act of 1933, as amended, or the Securities Act of 1934, as amended, (whether made before or after the date of the Report) irrespective of any general incorporation language contained in such filing. The signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.3

Exhibit 32.3

Certification of Chief Executive Officer

Pursuant to 18 U.S.C. § 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officer of Kilroy Realty Corporation, the sole general partner of Kilroy Realty, L.P. (the “Operating Partnership”), hereby certifies, to his knowledge, that:

(i)the accompanying Annual Report on Form 10-K of the Operating Partnership for the year ended December 31, 2020 (the “Report”) fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

(ii)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Operating Partnership.

/s/ John Kilroy
John Kilroy
Chief Executive Officer
Kilroy Realty Corporation, sole general partner of Kilroy Realty, L.P.
Date:	February 12, 2021

The foregoing certification is being furnished solely pursuant to 18 U.S.C. § 1350, is not being filed as part of the Report or as a separate disclosure document, and is not being incorporated by reference into any filing of Kilroy Realty Corporation or the Operating Partnership under the Securities Act of 1933, as amended, or the Securities Act of 1934, as amended, (whether made before or after the date of the Report) irrespective of any general incorporation language contained in such filing. The signed original of this written statement required by Section 906 has been provided to the Operating Partnership and will be retained by the Operating Partnership and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.4

Exhibit 32.4

Certification of Chief Financial Officer

Pursuant to 18 U.S.C. § 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officer of Kilroy Realty Corporation, the sole general partner of Kilroy Realty, L.P. (the “Operating Partnership”), hereby certifies, to his knowledge, that:

(i)the accompanying Annual Report on Form 10-K of the Operating Partnership for the year ended December 31, 2020 (the “Report”) fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

(ii)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Operating Partnership.

/s/ Michelle Ngo
Michelle Ngo
Senior Vice President, Chief Financial Officer and Treasurer
Kilroy Realty Corporation, sole general partner of Kilroy Realty, L.P.
Date:	February 12, 2021

The foregoing certification is being furnished solely pursuant to 18 U.S.C. § 1350, is not being filed as part of the Report or as a separate disclosure document, and is not being incorporated by reference into any filing of Kilroy Realty Corporation or the Operating Partnership under the Securities Act of 1933, as amended, or the Securities Act of 1934, as amended, (whether made before or after the date of the Report) irrespective of any general incorporation language contained in such filing. The signed original of this written statement required by Section 906 has been provided to the Operating Partnership and will be retained by the Operating Partnership and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Cover Page - USD ($)	12 Months Ended
	Dec. 31, 2020	Feb. 05, 2021	Jun. 30, 2020
Entity Information [Line Items]
Document Type	10-K
Document Annual Report	true
Document Period End Date	Dec. 31, 2020
Current Fiscal Year End Date	--12-31
Document Transition Report	false
Entity File Number	1-12675
Entity Registrant Name	KILROY REALTY CORPORATION
Entity Central Index Key	0001025996
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	FY
Amendment Flag	false
Entity Incorporation, State or Country Code	MD
Entity Tax Identification Number	95-4598246
Entity Address, Address Line One	12200 W. Olympic Boulevard
Entity Address, Address Line Two	Suite 200
Entity Address, City or Town	Los Angeles
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	90064
City Area Code	(310)
Local Phone Number	481-8400
Title of 12(b) Security	Common Stock, $.01 par value
Security Exchange Name	NYSE
Trading Symbol	KRC
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
ICFR Auditor Attestation Flag	true
Entity Shell Company	false
Entity Public Float			$ 6,728,133,187
Entity Common Stock, Shares Outstanding		116,369,096
Documents Incorporated by Reference	Portions of the Kilroy Realty Corporation’s Proxy Statement with respect to its 2021 Annual Meeting of Stockholders to be filed not later than 120 days after the end of the registrant’s fiscal year are incorporated by reference into Part III of this Form 10-K.
Kilroy Realty L.P. [Member]
Entity Information [Line Items]
Current Fiscal Year End Date	--12-31
Entity File Number	000-54005
Entity Registrant Name	KILROY REALTY, L.P.
Entity Central Index Key	0001493976
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	FY
Amendment Flag	false
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	95-4612685
Title of 12(g) Security	Common Units Representing Limited Partnership Interests
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
ICFR Auditor Attestation Flag	true
Entity Shell Company	false

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CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
REAL ESTATE ASSETS
Land and improvements	$ 1,628,848	$ 1,466,166
Buildings and improvements	6,783,092	5,866,477
Undeveloped land and construction in progress	1,778,106	2,296,130
Total real estate assets held for investment	10,190,046	9,628,773
Accumulated depreciation and amortization	(1,798,646)	(1,561,361)
Total real estate assets held for investment, net	8,391,400	8,067,412
CASH AND CASH EQUIVALENTS (Note 22)	731,991	60,044
RESTRICTED CASH (Notes 3, 4 and 22)	91,139	16,300
MARKETABLE SECURITIES (Notes 16 and 19)	27,481	27,098
CURRENT RECEIVABLES, NET (Notes 2 and 6)	12,007	26,489
DEFERRED RENT RECEIVABLES, NET (Notes 2 and 6)	386,658	337,937
DEFERRED LEASING COSTS AND ACQUISITION-RELATED INTANGIBLE ASSETS, NET (Notes 2, 3 and 5)	210,949	212,805
RIGHT OF USE GROUND LEASE ASSETS (Notes 2 and 18)	95,523	96,348
PREPAID EXPENSES AND OTHER ASSETS, NET (Note 7)	53,560	55,661
TOTAL ASSETS	10,000,708	8,900,094
LIABILITIES:
Secured debt, net (Notes 8, 9 and 19)	253,582	258,593
Unsecured debt, net (Notes 8, 9 and 19)	3,670,099	3,049,185
Unsecured line of credit (Notes 8, 9 and 19)	0	245,000
Accounts payable, accrued expenses and other liabilities (Note 18)	445,100	418,848
Ground lease liabilities (Notes 2 and 18)	97,778	98,400
Accrued dividends and distributions (Notes 13 and 27)	59,431	53,219
Deferred revenue and acquisition-related intangible liabilities, net (Notes 2, 3, 5 and 10)	128,523	139,488
Rents received in advance and tenant security deposits	68,874	66,503
Total liabilities	4,723,387	4,329,236
COMMITMENTS AND CONTINGENCIES (Note 18)
Stockholders’ Equity (Note 13):
Common stock, $.01 par value, 280,000,000 and 150,000,000 shares authorized, respectively, 116,035,827 and 106,016,287 shares issued and outstanding, respectively	1,160	1,060
Additional paid-in capital	5,131,916	4,350,917
Distributions in excess of earnings	(103,133)	(58,467)
Total stockholders’ equity	5,029,943	4,293,510
Noncontrolling Interests (Notes 2 and 11):
Common units of the Operating Partnership	49,875	81,917
Noncontrolling interests in consolidated property partnerships	197,503	195,431
Total noncontrolling interests	247,378	277,348
Total equity	5,277,321	4,570,858
TOTAL LIABILITIES AND EQUITY/CAPITAL	$ 10,000,708	$ 8,900,094

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CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Dec. 31, 2020	May 19, 2020	May 18, 2020	Dec. 31, 2019
Statement of Financial Position [Abstract]
Common stock, par value (in dollars per share)	$ 0.01			$ 0.01
Common stock, authorized (shares)	280,000,000	280,000,000	150,000,000	150,000,000
Common stock, shares issued (in shares)	116,035,827			106,016,287
Common stock, shares outstanding	116,035,827			106,016,287

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CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
REVENUES (Note 2):
Rental income	$ 892,306	$ 826,472	$ 656,631
Tenant reimbursements	0	0	80,982
Other property income	6,091	10,982	9,685
Revenues	898,397	837,454	747,298
EXPENSES:
Property expenses	155,118	160,037	133,787
Real estate taxes (Note 2)	92,218	78,097	70,820
Provision for bad debts (Note 2)	0	0	5,685
Ground leases (Notes 2, 5 and 18)	8,891	8,113
Ground leases (Notes 2, 5 and 18)			6,176
General and administrative expenses (Notes 15 and 19)	99,264	88,139	90,471
Leasing costs (Notes 2 and 5)	4,493	7,615
Depreciation and amortization (Notes 2 and 5)	299,308	273,130	254,281
Total expenses	659,292	615,131	561,220
OTHER (EXPENSES) INCOME:
Interest income and other net investment gain (loss) (Note 19)	3,424	4,641	(559)
Interest expense (Note 9)	(70,772)	(48,537)	(49,721)
Gains on sales of depreciable operating properties (Note 4)	35,536	36,802	142,926
Loss on early extinguishment of debt (Note 9)	0	0	(12,623)
Net gain on sales of land (Note 4)	0	0	11,825
Total other (expenses) income	(31,812)	(7,094)	91,848
NET INCOME	207,293	215,229	277,926
Net income attributable to noncontrolling common units of the Operating Partnership (Notes 2 and 11)	(2,869)	(3,766)	(5,193)
Net income attributable to noncontrolling interests in consolidated property partnerships (Notes 2 and 11)	(17,319)	(16,020)	(14,318)
Total income attributable to noncontrolling interests	(20,188)	(19,786)	(19,511)
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS (UNITHOLDERS)	$ 187,105	$ 195,443	$ 258,415
Net income available to common stockholders per share - basic (in dollars per share)	$ 1.63	$ 1.87	$ 2.56
Net income available to common stockholders per share - diluted (in dollars per share)	$ 1.63	$ 1.86	$ 2.55
Weighted average shares of common stock outstanding – basic (in shares)	113,241,341	103,200,568	99,972,359
Weighted average shares of common stock outstanding – diluted (in shares)	113,719,622	103,849,168	100,482,365
Revenue, Product and Service [Extensible List]	us-gaap:ServiceMember

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CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Thousands	Total	Total Stockholders' Equity	Common Stock [Member]	Additional Paid-in Capital [Member]	Distributions in Excess of Earnings [Member]	Noncontrolling Interests [Member]	Cumulative Effect, Period of Adoption, Adjustment [Member]	Cumulative Effect, Period of Adoption, Adjustment [Member] Total Stockholders' Equity	Cumulative Effect, Period of Adoption, Adjustment [Member] Distributions in Excess of Earnings [Member]
Beginning balance at Dec. 31, 2017	$ 3,960,316	$ 3,700,793	$ 986	$ 3,822,492	$ (122,685)	$ 259,523
Beginning balance (in shares) at Dec. 31, 2017			98,620,333
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	277,926	258,415			258,415	19,511
Issuance of common stock	130,693	130,693	$ 18	130,675
Issuance of common stock (in shares)			1,817,195
Issuance of share-based compensation awards	3,926	3,926		3,926
Non-cash amortization of share-based compensation	35,890	35,890		35,890
Exercise of stock options	41	41	$ 0	41
Exercise of stock options (in shares)			1,000
Settlement of restricted stock units for shares of common stock	$ 0		$ 4	(4)
Repurchase and cancellation of common stock, stock options and restricted stock (in shares)	0
Repurchase of common stock, stock options and restricted stock units	$ (16,553)	(16,553)	$ (2)	(16,551)
Repurchase of common stock, stock options and restricted stock units (in shares)			(231,800)
Settlement of restricted stock units for shares of common stock (in shares)			488,354
Exchange of common units of the Operating Partnership	0	1,962	$ 1	1,961		(1,962)
Exchange of common units of the Operating Partnership (in shares)			51,906
Contributions from noncontrolling interests in consolidated property partnerships	8,273					8,273
Distributions to noncontrolling interests in consolidated property partnerships	(11,803)					(11,803)
Adjustment for noncontrolling interest in the Operating Partnership	0	(1,477)		(1,477)		1,477
Dividends declared per share of common stock and common unit	(187,448)	(183,783)			(183,783)	(3,665)
Ending balance at Dec. 31, 2018	$ 4,201,261	3,929,907	$ 1,007	3,976,953	(48,053)	271,354	$ (3,146)	$ (3,146)	$ (3,146)
Ending balance (in shares) at Dec. 31, 2018			100,746,988
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Accounting Standards Update [Extensible List]	us-gaap:AccountingStandardsUpdate201602Member
Net income	$ 215,229	195,443			195,443	19,786
Issuance of common stock	353,722	353,722	$ 50	353,672
Issuance of common stock (in shares)			5,000,000
Issuance of share-based compensation awards	4,664	4,664		4,664
Non-cash amortization of share-based compensation	32,813	32,813		32,813
Exercise of stock options	703	703		703
Exercise of stock options (in shares)			16,500
Settlement of restricted stock units for shares of common stock	$ 0		$ 5	(5)
Repurchase and cancellation of common stock, stock options and restricted stock (in shares)	0		(212,477)
Repurchase and cancellation of common stock, stock options and restricted stock units			$ (2)	(14,859)
Repurchase of common stock, stock options and restricted stock units	$ (14,861)	(14,861)
Settlement of restricted stock units for shares of common stock (in shares)			463,276
Exchange of common units of the Operating Partnership	0	78	$ 0	78		(78)
Exchange of common units of the Operating Partnership (in shares)			2,000
Distributions to noncontrolling interests in consolidated property partnerships	(12,952)					(12,952)
Adjustment for noncontrolling interest in the Operating Partnership	0	(3,102)		(3,102)		3,102
Dividends declared per share of common stock and common unit	(206,575)	(202,711)			(202,711)	(3,864)
Ending balance at Dec. 31, 2019	$ 4,570,858	4,293,510	$ 1,060	4,350,917	(58,467)	277,348
Ending balance (in shares) at Dec. 31, 2019	106,016,287		106,016,287
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	$ 207,293	187,105			187,105	20,188
Issuance of common stock	721,665	721,665	$ 89	721,576
Issuance of common stock (in shares)			8,897,110
Issuance of share-based compensation awards	4,441	4,441		4,441
Non-cash amortization of share-based compensation	37,624	37,624		37,624
Settlement of restricted stock units for shares of common stock	$ 0		$ 4	(4)
Repurchase and cancellation of common stock, stock options and restricted stock (in shares)	0		(191,699)
Repurchase and cancellation of common stock, stock options and restricted stock units			$ (2)	(14,080)
Repurchase of common stock, stock options and restricted stock units	$ (14,082)	(14,082)
Settlement of restricted stock units for shares of common stock (in shares)			441,416
Exchange of common units of the Operating Partnership	0	37,640	$ 9	37,631		(37,640)
Exchange of common units of the Operating Partnership (in shares)			872,713
Distributions to noncontrolling interests in consolidated property partnerships	(15,247)					(15,247)
Adjustment for noncontrolling interest in the Operating Partnership	0	(6,189)		(6,189)		6,189
Dividends declared per share of common stock and common unit	(235,231)	(231,771)			(231,771)	(3,460)
Ending balance at Dec. 31, 2020	$ 5,277,321	$ 5,029,943	$ 1,160	$ 5,131,916	$ (103,133)	$ 247,378
Ending balance (in shares) at Dec. 31, 2020	116,035,827		116,035,827

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CONSOLIDATED STATEMENTS OF EQUITY (Parenthetical) - $ / shares	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Statement of Stockholders' Equity [Abstract]
Dividends declared per common share (in dollars per share)	$ 1.97	$ 1.91	$ 1.79

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CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ 207,293	$ 215,229	$ 277,926
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization of real estate assets and leasing costs	290,353	268,045	249,882
Depreciation of non-real estate furniture, fixtures and equipment	8,955	5,085	4,400
Revenue reversals (recoveries) for doubtful accounts (Notes 2 and 17)	18,997	(3,433)	5,685
Non-cash amortization of share-based compensation awards (Note 15)	30,245	27,007	27,932
Non-cash amortization of deferred financing costs and net debt discounts	2,958	1,427	1,084
Non-cash amortization of net below market rents (Note 5)	(7,603)	(9,206)	(9,748)
Gains on sales of depreciable operating properties (Note 4)	(35,536)	(36,802)	(142,926)
Non-cash amortization of deferred revenue related to tenant-funded tenant improvements (Note 10)	(17,547)	(19,190)	(18,429)
Straight-line rents	(67,826)	(72,023)	(26,976)
Amortization of right of use ground lease assets (Note 2)	825	683
Loss on early extinguishment of debt (Note 9)	0	0	12,623
Gain on sale of land (Note 4)	0	0	(11,825)
Net change in other operating assets	(3,685)	(14,476)	(7,930)
Net change in other operating liabilities	28,161	24,175	48,345
Net cash provided by operating activities	455,590	386,521	410,043
CASH FLOWS FROM INVESTING ACTIVITIES:
Expenditures for development properties and undeveloped land	(486,565)	(845,464)	(489,236)
Expenditures for operating properties and other capital assets	(129,500)	(147,687)	(166,440)
Net proceeds received from dispositions (Note 4)	74,937	124,421	364,300
(Increase) decrease in acquisition-related deposits	(1,000)	0	36,000
Expenditures for acquisitions of development properties and undeveloped land (Note 3)	0	(173,291)	(311,299)
Expenditures for acquisitions of operating properties (Note 3)	0	(186,258)	(257,340)
Proceeds received from repayment of note receivable	0	0	15,100
Net cash used in investing activities	(542,128)	(1,228,279)	(808,915)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from issuance of common stock (Note 13)	721,665	353,722	130,693
Net proceeds from the issuance of unsecured debt (Note 9)	772,297	499,390	648,537
Repayments of unsecured debt (Note 9)	(150,000)	0	(261,823)
Borrowings on unsecured revolving credit facility	190,000	1,110,000	765,000
Repayments on unsecured revolving credit facility	(435,000)	(910,000)	(690,000)
Principal payments and repayments of secured debt (Note 9)	(5,137)	(76,309)	(3,584)
Financing costs	(6,594)	(6,678)	(6,262)
Repurchase of common stock and restricted stock units (Note 15)	(14,082)	(14,556)	(16,553)
Distributions to noncontrolling interests in consolidated property partnerships	(15,247)	(12,952)	(11,803)
Dividends and distributions paid to common stockholders and common unitholders	(224,578)	(196,252)	(179,411)
Proceeds from exercise of stock options	0	703	41
Borrowings on unsecured debt	0	0	120,000
Contributions from noncontrolling interests in consolidated property partnerships	0	0	8,273
Net cash provided by financing activities	833,324	747,068	503,108
Net increase (decrease) in cash and cash equivalents and restricted cash	746,786	(94,690)	104,236
Cash and cash equivalents and restricted cash, beginning of year	76,344	171,034	66,798
Cash and cash equivalents and restricted cash, end of year	$ 823,130	$ 76,344	$ 171,034

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CONSOLIDATED BALANCE SHEETS (KILROY REALTY, L.P.) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
REAL ESTATE ASSETS
Land and improvements	$ 1,628,848	$ 1,466,166
Buildings and improvements	6,783,092	5,866,477
Undeveloped land and construction in progress	1,778,106	2,296,130
Total real estate assets held for investment	10,190,046	9,628,773
Accumulated depreciation and amortization	(1,798,646)	(1,561,361)
Total real estate assets held for investment, net	8,391,400	8,067,412
CASH AND CASH EQUIVALENTS (Note 23)	731,991	60,044
RESTRICTED CASH (Notes 3, 4 and 23)	91,139	16,300
MARKETABLE SECURITIES (Notes 16 and 19)	27,481	27,098
CURRENT RECEIVABLES, NET (Notes 2 and 6)	12,007	26,489
DEFERRED RENT RECEIVABLES, NET (Notes 2 and 6)	386,658	337,937
DEFERRED LEASING COSTS AND ACQUISITION-RELATED INTANGIBLE ASSETS, NET (Notes 2, 3 and 5)	210,949	212,805
RIGHT OF USE GROUND LEASE ASSETS (Notes 2 and 18)	95,523	96,348
PREPAID EXPENSES AND OTHER ASSETS, NET (Note 7)	53,560	55,661
TOTAL ASSETS	10,000,708	8,900,094
LIABILITIES:
Secured debt, net (Notes 9 and 19)	253,582	258,593
Unsecured debt, net (Notes 9 and 19)	3,670,099	3,049,185
Unsecured line of credit (Notes 9 and 19)	0	245,000
Accounts payable, accrued expenses and other liabilities (Note 18)	445,100	418,848
Ground lease liabilities (Notes 2 and 18)	97,778	98,400
Accrued distributions (Notes 14 and 27)	59,431	53,219
Deferred revenue and acquisition-related intangible liabilities, net (Notes 2, 3, 5 and 10)	128,523	139,488
Rents received in advance and tenant security deposits	68,874	66,503
Total liabilities	4,723,387	4,329,236
COMMITMENTS AND CONTINGENCIES (Note 18)
Partners’ Capital:
TOTAL LIABILITIES AND EQUITY/CAPITAL	10,000,708	8,900,094
Kilroy Realty L.P. [Member]
REAL ESTATE ASSETS
Land and improvements	1,628,848	1,466,166
Buildings and improvements	6,783,092	5,866,477
Undeveloped land and construction in progress	1,778,106	2,296,130
Total real estate assets held for investment	10,190,046	9,628,773
Accumulated depreciation and amortization	(1,798,646)	(1,561,361)
Total real estate assets held for investment, net	8,391,400	8,067,412
CASH AND CASH EQUIVALENTS (Note 23)	731,991	60,044
RESTRICTED CASH (Notes 3, 4 and 23)	91,139	16,300
MARKETABLE SECURITIES (Notes 16 and 19)	27,481	27,098
CURRENT RECEIVABLES, NET (Notes 2 and 6)	12,007	26,489
DEFERRED RENT RECEIVABLES, NET (Notes 2 and 6)	386,658	337,937
DEFERRED LEASING COSTS AND ACQUISITION-RELATED INTANGIBLE ASSETS, NET (Notes 2, 3 and 5)	210,949	212,805
RIGHT OF USE GROUND LEASE ASSETS (Notes 2 and 18)	95,523	96,348
PREPAID EXPENSES AND OTHER ASSETS, NET (Note 7)	53,560	55,661
TOTAL ASSETS	10,000,708	8,900,094
LIABILITIES:
Secured debt, net (Notes 9 and 19)	253,582	258,593
Unsecured debt, net (Notes 9 and 19)	3,670,099	3,049,185
Unsecured line of credit (Notes 9 and 19)	0	245,000
Accounts payable, accrued expenses and other liabilities (Note 18)	445,100	418,848
Ground lease liabilities (Notes 2 and 18)	97,778	98,400
Accrued distributions (Notes 14 and 27)	59,431	53,219
Deferred revenue and acquisition-related intangible liabilities, net (Notes 2, 3, 5 and 10)	128,523	139,488
Rents received in advance and tenant security deposits	68,874	66,503
Total liabilities	4,723,387	4,329,236
COMMITMENTS AND CONTINGENCIES (Note 18)
Partners’ Capital:
Common units, 116,035,827 and 106,016,287 held by the general partner and 1,150,574 and 2,023,287 held by common limited partners issued and outstanding, respectively (Note 14)	5,079,818	4,369,758
Total partners’ capital	5,079,818	4,369,758
Noncontrolling interests in consolidated property partnerships and subsidiaries (Notes 2 and 12)	197,503	201,100
Total capital	5,277,321	4,570,858
TOTAL LIABILITIES AND EQUITY/CAPITAL	$ 10,000,708	$ 8,900,094

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CONSOLIDATED BALANCE SHEETS (KILROY REALTY, L.P.) (Parenthetical) - Common units [Member] - Kilroy Realty L.P. [Member] - shares	Dec. 31, 2020	Dec. 31, 2019
General partner, units issued (in units)	116,035,827	106,016,287
General partner, units outstanding (in units)	116,035,827	106,016,287
Limited partner, units issued (in units)	1,150,574	2,023,287
Limited partner, units outstanding (in units)	1,150,574	2,023,287

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CONSOLIDATED STATEMENTS OF OPERATIONS (KILROY REALTY, L.P.) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
REVENUES (Note 2):
Rental income	$ 892,306	$ 826,472	$ 656,631
Tenant reimbursements	0	0	80,982
Other property income	6,091	10,982	9,685
Revenues	898,397	837,454	747,298
EXPENSES:
Property expenses	155,118	160,037	133,787
Real estate taxes (Note 2)	92,218	78,097	70,820
Provision for bad debts (Note 2)	0	0	5,685
Ground leases (Notes 2, 5 and 18)	8,891	8,113
Ground leases (Notes 2, 5 and 18)			6,176
General and administrative expenses (Notes 15 and 19)	99,264	88,139	90,471
Leasing costs (Notes 2 and 5)	4,493	7,615
Depreciation and amortization (Notes 2 and 5)	299,308	273,130	254,281
Total expenses	659,292	615,131	561,220
OTHER (EXPENSES) INCOME:
Interest income and other net investment gain (loss) (Note 19)	3,424	4,641	(559)
Interest expense (Note 9)	(70,772)	(48,537)	(49,721)
Gains on sales of depreciable operating properties (Note 4)	35,536	36,802	142,926
Loss on early extinguishment of debt (Note 9)	0	0	(12,623)
Net gain on sales of land (Note 4)	0	0	11,825
Total other (expenses) income	(31,812)	(7,094)	91,848
NET INCOME	207,293	215,229	277,926
Net income attributable to noncontrolling interests in consolidated property partnerships and subsidiaries (Notes 2 and 12)	(20,188)	(19,786)	(19,511)
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS (UNITHOLDERS)	$ 187,105	$ 195,443	$ 258,415
Net income available to common unitholders per unit - basic (in dollars per unit)	$ 1.63	$ 1.87	$ 2.56
Net income available to common unitholders per unit - diluted (in dollars per unit)	$ 1.63	$ 1.86	$ 2.55
Weighted average common units outstanding - basic (in shares)	113,241,341	103,200,568	99,972,359
Weighted average common units outstanding - diluted (in shares)	113,719,622	103,849,168	100,482,365
Revenue, Product and Service [Extensible List]	us-gaap:ServiceMember
Kilroy Realty L.P. [Member]
REVENUES (Note 2):
Rental income	$ 892,306	$ 826,472	$ 656,631
Tenant reimbursements	0	0	80,982
Other property income	6,091	10,982	9,685
Revenues	898,397	837,454	747,298
EXPENSES:
Property expenses	155,118	160,037	133,787
Real estate taxes (Note 2)	92,218	78,097	70,820
Provision for bad debts (Note 2)	0	0	5,685
Ground leases (Notes 2, 5 and 18)	8,891	8,113
Ground leases (Notes 2, 5 and 18)			6,176
General and administrative expenses (Notes 15 and 19)	99,264	88,139	90,471
Leasing costs (Notes 2 and 5)	4,493	7,615
Depreciation and amortization (Notes 2 and 5)	299,308	273,130	254,281
Total expenses	659,292	615,131	561,220
OTHER (EXPENSES) INCOME:
Interest income and other net investment gain (loss) (Note 19)	3,424	4,641	(559)
Interest expense (Note 9)	(70,772)	(48,537)	(49,721)
Gains on sales of depreciable operating properties (Note 4)	35,536	36,802	142,926
Loss on early extinguishment of debt (Note 9)	0	0	(12,623)
Net gain on sales of land (Note 4)	0	0	11,825
Total other (expenses) income	(31,812)	(7,094)	91,848
NET INCOME	207,293	215,229	277,926
Net income attributable to noncontrolling interests in consolidated property partnerships and subsidiaries (Notes 2 and 12)	(17,684)	(16,491)	(14,716)
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS (UNITHOLDERS)	$ 189,609	$ 198,738	$ 263,210
Net income available to common unitholders per unit - basic (in dollars per unit)	$ 1.63	$ 1.87	$ 2.56
Net income available to common unitholders per unit - diluted (in dollars per unit)	$ 1.62	$ 1.86	$ 2.55
Weighted average common units outstanding - basic (in shares)	115,095,506	105,223,975	102,025,276
Weighted average common units outstanding - diluted (in shares)	115,573,787	105,872,575	102,535,282
Revenue, Product and Service [Extensible List]	us-gaap:ServiceMember

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CONSOLIDATED STATEMENTS OF CAPITAL (KILROY REALTY, L.P.) - USD ($) $ in Thousands	3 Months Ended				12 Months Ended
	Dec. 31, 2020	Mar. 31, 2020	Dec. 31, 2019	Mar. 31, 2019	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	$ 83,452	$ 45,418	$ 77,922	$ 41,794	$ 207,293	$ 215,229	$ 277,926
Non-cash amortization of share-based compensation					37,624	32,813	35,890
Settlement of restricted stock units					0	0	0
Distributions to noncontrolling interests in consolidated property partnerships					(15,247)	(12,952)	$ (11,803)
Accounting Standards Update [Extensible List]							us-gaap:AccountingStandardsUpdate201602Member
Noncontrolling Interest In Consolidated Subsidiaries [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income					20,188	19,786	$ 19,511
Distributions to noncontrolling interests in consolidated property partnerships					(15,247)	(12,952)	(11,803)
Kilroy Realty L.P. [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning balance		4,570,858		4,201,261	4,570,858	4,201,261	3,960,316
Net income	83,452	45,418	77,922	41,794	207,293	215,229	277,926
Issuance of common units					721,665	353,722	130,693
Issuance of share-based compensation awards					4,441	4,664	3,926
Non-cash amortization of share-based compensation					37,624	32,813	35,890
Exercise of stock options						703	41
Settlement of restricted stock units					0	0	0
Repurchase of common units and restricted stock units					(14,082)	(14,861)	(16,553)
Contributions from noncontrolling interest in consolidated property partnerships							8,273
Distributions to noncontrolling interests in consolidated property partnerships					(15,247)	(12,952)	(11,803)
Distributions declared per common unit					(235,231)	(206,575)	(187,448)
Ending balance	5,277,321		4,570,858		5,277,321	4,570,858	4,201,261
Kilroy Realty L.P. [Member] | Partners Capital Common Unit [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning balance		$ 4,369,758		$ 4,003,700	$ 4,369,758	$ 4,003,700	$ 3,773,941
Beginning balance (in units)		108,039,574		102,772,275	108,039,574	102,772,275	100,697,526
Net income					$ 189,609	$ 198,738	$ 263,210
Issuance of common units					$ 721,665	$ 353,722	$ 130,693
Issuance of common units (in units)					8,897,110	5,000,000	1,817,195
Issuance of share-based compensation awards					$ 4,441	$ 4,664	$ 3,926
Non-cash amortization of share-based compensation					$ 37,624	32,813	35,890
Exercise of stock options						$ 703	$ 41
Exercise of stock options (in units)						16,500	1,000
Settlement of restricted stock units (in units)					441,416	463,276	488,354
Repurchase of common units and restricted stock units					$ (14,082)	$ (14,861)	$ (16,553)
Repurchase of common units and restricted stock units (in units)					(191,699)	(212,477)	(231,800)
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests					$ 6,034
Distributions declared per common unit					(235,231)	$ (206,575)	$ (187,448)
Ending balance	$ 5,079,818		$ 4,369,758		$ 5,079,818	$ 4,369,758	$ 4,003,700
Ending balance (in units)	117,186,401		108,039,574		117,186,401	108,039,574	102,772,275
Kilroy Realty L.P. [Member] | Noncontrolling Interest In Consolidated Subsidiaries [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning balance		$ 201,100		$ 197,561	$ 201,100	$ 197,561	$ 186,375
Net income					17,684	16,491	14,716
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests					(6,034)
Contributions from noncontrolling interest in consolidated property partnerships							8,273
Distributions to noncontrolling interests in consolidated property partnerships					(15,247)	(12,952)	(11,803)
Ending balance	$ 197,503		$ 201,100		$ 197,503	201,100	197,561
Cumulative Effect, Period of Adoption, Adjustment [Member] | Kilroy Realty L.P. [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning balance				(3,146)		(3,146)
Ending balance							(3,146)
Cumulative Effect, Period of Adoption, Adjustment [Member] | Kilroy Realty L.P. [Member] | Partners Capital Common Unit [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning balance				$ (3,146)		$ (3,146)
Ending balance							$ (3,146)

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CONSOLIDATED STATEMENTS OF CAPITAL (KILROY REALTY, L.P.) - Parenthetical - $ / shares	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Kilroy Realty L.P. [Member]
Distributions declared per common unit (in dollars per units)	$ 1.97	$ 1.91	$ 1.79

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CONSOLIDATED STATEMENTS OF CASH FLOWS (KILROY REALTY, L.P.) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ 207,293	$ 215,229	$ 277,926
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization of real estate assets and leasing costs	290,353	268,045	249,882
Depreciation of non-real estate furniture, fixtures and equipment	8,955	5,085	4,400
Revenue reversals (recoveries) for doubtful accounts (Notes 2 and 17)	18,997	(3,433)	5,685
Non-cash amortization of share-based compensation awards (Note 15)	30,245	27,007	27,932
Non-cash amortization of deferred financing costs and net debt discounts	2,958	1,427	1,084
Non-cash amortization of net below market rents (Note 5)	(7,603)	(9,206)	(9,748)
Gains on sales of depreciable operating properties (Note 4)	(35,536)	(36,802)	(142,926)
Non-cash amortization of deferred revenue related to tenant-funded tenant improvements (Note 10)	(17,547)	(19,190)	(18,429)
Straight-line rents	(67,826)	(72,023)	(26,976)
Amortization of right of use ground lease assets (Note 2)	825	683
Net change in other operating assets	(3,685)	(14,476)	(7,930)
Net change in other operating liabilities	28,161	24,175	48,345
Loss on early extinguishment of debt (Note 9)	0	0	12,623
Gain on sale of land (Note 4)	0	0	(11,825)
Net cash provided by operating activities	455,590	386,521	410,043
CASH FLOWS FROM INVESTING ACTIVITIES:
Expenditures for development properties and undeveloped land	(486,565)	(845,464)	(489,236)
Expenditures for operating properties and other capital assets	(129,500)	(147,687)	(166,440)
Net proceeds received from dispositions (Note 4)	74,937	124,421	364,300
(Increase) decrease in acquisition-related deposits	(1,000)	0	36,000
Expenditures for acquisitions of development properties and undeveloped land (Note 3)	0	(173,291)	(311,299)
Expenditures for acquisitions of operating properties (Note 3)	0	(186,258)	(257,340)
Proceeds received from repayment of note receivable	0	0	15,100
Net cash used in investing activities	(542,128)	(1,228,279)	(808,915)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from issuance of common units (Note 14)	721,665	353,722	130,693
Net proceeds from the issuance of unsecured debt (Note 9)	772,297	499,390	648,537
Repayments of unsecured debt (Note 9)	(150,000)	0	(261,823)
Borrowings on unsecured revolving credit facility	190,000	1,110,000	765,000
Repayments on unsecured revolving credit facility	(435,000)	(910,000)	(690,000)
Principal payments and repayments of secured debt (Note 9)	(5,137)	(76,309)	(3,584)
Financing costs	(6,594)	(6,678)	(6,262)
Repurchase of common units and restricted stock units (Note 15)	(14,082)	(14,556)	(16,553)
Distributions to noncontrolling interests in consolidated property partnerships	(15,247)	(12,952)	(11,803)
Distributions paid to common unitholders	(224,578)	(196,252)	(179,411)
Proceeds from exercise of stock options	0	703	41
Borrowings on unsecured debt	0	0	120,000
Contributions from noncontrolling interests in consolidated property partnerships	0	0	8,273
Net cash provided by financing activities	833,324	747,068	503,108
Net increase (decrease) in cash and cash equivalents and restricted cash	746,786	(94,690)	104,236
Cash and cash equivalents and restricted cash, beginning of year	76,344	171,034	66,798
Cash and cash equivalents and restricted cash, end of year	823,130	76,344	171,034
Kilroy Realty L.P. [Member]
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	207,293	215,229	277,926
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization of real estate assets and leasing costs	290,353	268,045	249,882
Depreciation of non-real estate furniture, fixtures and equipment	8,955	5,085	4,400
Revenue reversals (recoveries) for doubtful accounts (Notes 2 and 17)	18,997	(3,433)	5,685
Non-cash amortization of share-based compensation awards (Note 15)	30,245	27,007	27,932
Non-cash amortization of deferred financing costs and net debt discounts	2,958	1,427	1,084
Non-cash amortization of net below market rents (Note 5)	(7,603)	(9,206)	(9,748)
Gains on sales of depreciable operating properties (Note 4)	(35,536)	(36,802)	(142,926)
Non-cash amortization of deferred revenue related to tenant-funded tenant improvements (Note 10)	(17,547)	(19,190)	(18,429)
Straight-line rents	(67,826)	(72,023)	(26,976)
Amortization of right of use ground lease assets (Note 2)	825	683
Net change in other operating assets	(3,685)	(14,476)	(7,930)
Net change in other operating liabilities	28,161	24,175	48,345
Loss on early extinguishment of debt (Note 9)	0	0	12,623
Gain on sale of land (Note 4)	0	0	(11,825)
Net cash provided by operating activities	455,590	386,521	410,043
CASH FLOWS FROM INVESTING ACTIVITIES:
Expenditures for development properties and undeveloped land	(486,565)	(845,464)	(489,236)
Expenditures for operating properties and other capital assets	(129,500)	(147,687)	(166,440)
Net proceeds received from dispositions (Note 4)	74,937	124,421	364,300
(Increase) decrease in acquisition-related deposits	(1,000)	0	36,000
Expenditures for acquisitions of development properties and undeveloped land (Note 3)	0	(173,291)	(311,299)
Expenditures for acquisitions of operating properties (Note 3)	0	(186,258)	(257,340)
Proceeds received from repayment of note receivable	0	0	15,100
Net cash used in investing activities	(542,128)	(1,228,279)	(808,915)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from issuance of common units (Note 14)	721,665	353,722	130,693
Net proceeds from the issuance of unsecured debt (Note 9)	772,297	499,390	648,537
Repayments of unsecured debt (Note 9)	(150,000)	0	(261,823)
Borrowings on unsecured revolving credit facility	190,000	1,110,000	765,000
Repayments on unsecured revolving credit facility	(435,000)	(910,000)	(690,000)
Principal payments and repayments of secured debt (Note 9)	(5,137)	(76,309)	(3,584)
Financing costs	(6,594)	(6,678)	(6,262)
Repurchase of common units and restricted stock units (Note 15)	(14,082)	(14,556)	(16,553)
Distributions to noncontrolling interests in consolidated property partnerships	(15,247)	(12,952)	(11,803)
Distributions paid to common unitholders	(224,578)	(196,252)	(179,411)
Proceeds from exercise of stock options	0	703	41
Borrowings on unsecured debt	0	0	120,000
Contributions from noncontrolling interests in consolidated property partnerships	0	0	8,273
Net cash provided by financing activities	833,324	747,068	503,108
Net increase (decrease) in cash and cash equivalents and restricted cash	746,786	(94,690)	104,236
Cash and cash equivalents and restricted cash, beginning of year	76,344	171,034	66,798
Cash and cash equivalents and restricted cash, end of year	$ 823,130	$ 76,344	$ 171,034

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Organization and Ownership

12 Months Ended

Dec. 31, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization and Ownership

Organization and Ownership

Kilroy Realty Corporation (the “Company”) is a self-administered real estate investment trust (“REIT”) active in premier office and mixed-use 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 Greater Los Angeles, 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”). 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 properties at December 31, 2020:

	Number of Buildings	Rentable Square Feet (unaudited)	Number of Tenants	Percentage  Occupied (unaudited) (1)		Percentage Leased (unaudited)
Stabilized Office Properties (2)	117	14,620,166	447	91.2	%	94.3	%

_______________________

(1)Represents physical and economic occupancy.

(2)Includes stabilized life science and retail space.

	Number of Projects	Number of Units	2020 Average Occupancy (unaudited)
Stabilized Residential Properties	2	808	72.0	%

Our stabilized portfolio includes all of our properties with the exception of development and redevelopment properties currently committed for construction, under construction, or in the tenant improvement phase, undeveloped land and real estate assets held for sale. 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 properties in the tenant improvement phase as office and life science properties that we are developing or redeveloping where the project has reached cold shell condition and is ready for tenant improvements, which may require additional major base building construction before being placed in service. Projects in the tenant improvement phase are added to our stabilized portfolio once the project reaches the earlier of 95% occupancy or one year from the date of the cessation of major base building construction activities. Costs capitalized to construction in progress for development and redevelopment properties are transferred to land and improvements, buildings and improvements, and deferred leasing costs on our consolidated balance sheets at the historical cost of the property as the projects or phases of projects are placed in service.

During the year ended December 31, 2020, we added four development projects to our stabilized portfolio consisting of 750,370 square feet of office space in San Francisco, California, 361,388 square feet of office space in Hollywood, California, 95,871 square feet of retail space and 608 residential units in San Diego, California. As of December 31, 2020, the following properties were excluded from our stabilized portfolio. We did not have any redevelopment properties or properties held for sale at December 31, 2020.

	Number of Properties/Projects	Estimated Rentable Square Feet (1) (unaudited)
In-process development projects - tenant improvement	3	1,080,000
In-process development projects - under construction (2)	3	856,000

____________________

(1)Estimated rentable square feet upon completion.

(2)In addition to the estimated office and life science rentable square feet noted above, development projects under construction also include 193 residential units.

Our stabilized portfolio also excludes our future development pipeline, which as of December 31, 2020 was comprised of five future development sites, representing approximately 61 gross acres of undeveloped land.

As of December 31, 2020, 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 eight stabilized office properties, one development project in the tenant improvement phase and one future development project located in the state of Washington. All of our properties and development projects are 100% owned, excluding four office properties owned by three consolidated property partnerships. Two of the three consolidated property partnerships, 100 First Street Member, LLC (“100 First LLC”) and 303 Second Street Member, LLC (“303 Second LLC”), each owned one office property in San Francisco, California through subsidiary REITs. As of December 31, 2020, the Company owned a 56% common equity interest in both 100 First LLC and 303 Second LLC. The third consolidated property partnership, Redwood City Partners, LLC (“Redwood LLC”) owned two office properties in Redwood City, California. As of December 31, 2020, the Company owned an approximate 93% common equity interest in Redwood LLC. The remaining interests in all three property partnerships were owned by unrelated third parties.

As of December 31, 2020, the Company owned an approximate 99.0% common general partnership interest in the Operating Partnership. The remaining approximate 1.0% common limited partnership interest in the Operating Partnership as of December 31, 2020 was owned by non-affiliated investors and certain of our executive officers and directors. 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”. With the exception of the Operating Partnership and our consolidated property partnerships, all of our subsidiaries are wholly-owned.

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Basis of Presentation and Significant Accounting Policies

12 Months Ended

Dec. 31, 2020

Basis of Presentation and Significant Accounting Policies [Abstract]

Basis of Presentation and Significant Accounting Policies

Basis of Presentation and Significant Accounting Policies

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, 303 Second LLC, 100 First LLC, 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, 303 Second LLC, 100 First LLC, Redwood LLC and all of our wholly-owned and controlled subsidiaries. All intercompany balances and transactions have been eliminated in the consolidated financial statements.

Partially Owned Entities and Variable Interest Entities

At December 31, 2020 the consolidated financial statements of the Company included two VIEs in addition to the Operating Partnership: 100 First LLC and 303 Second LLC. At December 31, 2020, the Company and the Operating Partnership were determined to be the primary beneficiaries of these two VIEs since we had the ability to control the activities that most significantly impact each of the VIEs’ economic performance. As of December 31, 2020, the two VIEs’ total assets, liabilities and noncontrolling interests included on our consolidated balance sheet were approximately $469.3 million (of which $394.6 million related to real estate held for investment), approximately $33.9 million and approximately $191.9 million, respectively. Revenues, income and net assets generated by 100 First LLC and 303 Second LLC may only be used to settle their contractual obligations, which primarily consist of operating expenses, capital expenditures and required distributions.

At December 31, 2019, the consolidated financial statements of the Company included four VIEs in addition to the Operating Partnership: two of the consolidated property partnerships, 100 First LLC and 303 Second LLC, and two entities established during the fourth quarter of 2019 to facilitate a Section 1031 Exchange. At December 31, 2019, the Company and the Operating Partnership were determined to be the primary beneficiaries of these four VIEs since we had the ability to control the activities that most significantly impact each of the VIEs’ economic performance. At December 31, 2019, the four VIEs’ total assets, liabilities and noncontrolling interests included on our consolidated balance sheet were approximately $676.7 million (of which $598.0 million related to real estate held for investment on our consolidated balance sheet), approximately $40.1 million and approximately $189.6 million, respectively.

Our accounting policy is to consolidate entities in which we have a controlling financial interest and significant decision making control over the entity's operations. In determining whether we have a controlling financial interest in a partially owned entity and the requirement to consolidate the accounts of that entity, we consider factors such as ownership interest, board representation, management representation, size of our investment (including loans), authority to control decisions, and contractual and substantive participating rights of the members. In addition to evaluating control rights, we consolidate entities in which the other members have no substantive kick-out rights to remove the Company as the managing member.

Entities in which the equity investors do not have sufficient equity at risk to finance their endeavors without additional financial support or the holders of the equity investment at risk do not have a controlling financial interest are VIEs. We evaluate whether an entity is a VIE and whether we are the primary beneficiary. We are deemed to be the primary beneficiary of a VIE when we have the power to direct the activities of the VIE that most significantly impact the VIEs’ economic performance and the obligation to absorb losses or receive benefits that could potentially be significant to the VIE.

If the requirements for consolidation are not met, the Company would account for investments under the equity method of accounting if we have the ability to exercise significant influence over the entity. Equity method investments would be initially recorded at cost and subsequently adjusted for our share of net income or loss and cash contributions and distributions each period. The Company did not have any equity method investments at December 31, 2020 or 2019.

Accounting Pronouncements Adopted January 1, 2020

ASU No. 2016-13 “Financial Instruments - Credit Losses (Topic 326)”

Effective January 1, 2020, we adopted Financial Accounting Standards Board (“FASB”) FASB Accounting Standards Update (“ASU”) No. 2016-13 (“ASU 2016-13”), which amends 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.  In November 2018, the FASB released ASU No. 2018-19 “Codification Improvements to Topic 326, Financial Instruments - Credit Losses.” This ASU clarifies that receivables arising from operating leases are not within the scope of Subtopic 326-20 “Financial Instruments – Credit Losses.” Instead, impairment of receivables arising from operating leases should be accounted for under Subtopic 842-30 “Leases – Lessor.” The adoption did not have a material impact on our consolidated financial statements or notes to our consolidated financial statements.

ASU No. 2018-13 “Fair Value Measurement (Topic 820)”

Effective January 1, 2020, we adopted FASB ASU No. 2018-13 (“ASU 2018-13”), which amends the disclosure requirements for fair value measurements. The amendments in ASU 2018-13 include new, modified and eliminated disclosure requirements and are the result of a broader disclosure project called FASB Concepts Statement, Conceptual Framework for Financial Reporting - Chapter 8: Notes to Financial Statements (the “Concepts Statement”), which the FASB finalized on August 28, 2018. The FASB used the guidance in the Concepts Statement to improve the effectiveness of Topic 820’s disclosure requirements. The adoption did not have a material impact on our consolidated financial statements or notes to our consolidated financial statements.

ASU No. 2018-15 “Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40)”

Effective January 1, 2020, we adopted FASB ASU No. 2018-15 (“ASU 2018-15”), which amends a customer’s accounting for implementation costs incurred in a cloud computing arrangement that is a service contract. ASU 2018-15 aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). The adoption did not have a material impact on our consolidated financial statements or notes to our consolidated financial statements.

COVID-19 Lease Modification Accounting Relief

The global impact of the COVID-19 pandemic continues to evolve rapidly. Both of the states where we own properties and/or have development projects (i.e., California and Washington), have reacted to the COVID-19 pandemic by instituting quarantines, restrictions on travel, “shelter in place” rules, restrictions on types of business that may continue to operate and/or restrictions on types of construction projects that may continue. These restrictions have impacted our business, as well as that of our tenants.

Due to the business disruptions and challenges severely affecting the global economy caused by the COVID-19 pandemic, many lessors may be required to provide rent deferrals and other lease concessions to lessees. While the lease modification guidance in Accounting Standards Codification (“ASC”) Topic 842 (“Topic 842”) addresses routine changes to lease terms resulting from negotiations between the lessee and the lessor, this guidance did not contemplate concessions being so rapidly executed to address the sudden liquidity constraints of some lessees arising from the COVID-19 pandemic and restrictions intended to prevent its spread.

In April 2020, the FASB staff issued a question and answer document (the “Lease Modification Q&A”) focused on the application of lease accounting guidance to lease concessions provided as a result of the COVID-19 pandemic. Under existing lease guidance, the Company would have to determine, on a lease by lease basis, if a lease concession was the result of a new arrangement reached with the tenant (treated within the lease modification accounting framework) or if a lease concession was under the enforceable rights and obligations within the existing lease agreement (precluded from applying the lease modification accounting framework). The Lease Modification Q&A allows the Company, if certain criteria have been met, to bypass the lease by lease analysis, and instead elect to either apply the lease modification accounting framework or not, with such election applied consistently to leases

with similar characteristics and similar circumstances. The Company has elected to apply such relief and availed itself of the election to avoid performing a lease by lease analysis. In addition, the Company has elected to apply the lease modification accounting framework consistently to leases within the property types in which it invests, specifically office, life science, residential and retail properties.

Significant Accounting Policies

Revenue Recognition

Rental revenue for office, life science and retail operating properties is our principal source of revenue. We recognize revenue from base rent, additional rent (which consists of amounts due from tenants for common area maintenance, real estate taxes, and other recoverable costs), parking and other lease-related revenue once all of the following criteria are met: (i) the agreement has been fully executed and delivered, (ii) services have been rendered, (iii) the amount is fixed or determinable and (iv) payment has been received or the collectability of the amount due is probable. Lease termination fees are amortized over the remaining lease term, if applicable. If there is no remaining lease term, they are recognized when received and realized. Minimum annual rental revenues are recognized in rental revenues on a straight-line basis over the non-cancellable term of the related lease.

Base Rent

The timing of when we commence rental revenue recognition for office, life science and retail properties depends largely on our conclusion as to whether the Company or the tenant is the owner for accounting purposes of tenant improvements at the leased property. When we conclude that we are the owner of tenant improvements for accounting purposes, we record the cost to construct the tenant improvements as an asset and commence rental revenue recognition when the tenant takes possession of or controls the finished space, which is generally when tenant improvements being recorded as our assets are substantially complete. In certain instances, when we conclude that the tenant is the owner of certain tenant improvements for accounting purposes, rental revenue recognition begins when the tenant takes possession or controls the physical use of the leased space, which may occur in phases or for an entire building or project. The determination of who owns the tenant improvements is made on a lease-by-lease basis and has a significant effect on the timing of commencement of revenue recognition.

When we conclude that the Company is the owner of tenant improvements for accounting purposes, we record the cost to construct the tenant improvements, including costs paid for or reimbursed by the tenants, as a capital asset. For these tenant-funded tenant improvements, we record the amount funded by or reimbursed by tenants as deferred revenue, which is amortized and recognized as rental income on a straight-line basis over the term of the related lease.

When we conclude that the tenant is the owner of certain tenant improvements for accounting purposes, we record our contribution towards those tenant-owned improvements as a lease incentive, which is included in deferred leasing costs and acquisition-related intangible assets, net on our consolidated balance sheets and amortized as a reduction to rental revenue on a straight-line basis over the term of the related lease.

For residential properties, we commence revenue recognition upon lease commencement. Residential rental revenue is recognized on a straight-line basis over the term of the related lease, net of any concessions.

Additional Rent - Reimbursements from Tenants

Additional rent, consisting of amounts due from tenants for common area maintenance, real estate taxes and other recoverable costs, are recognized in rental income in the period the recoverable costs are incurred. Prior to the adoption of Topic 842 on January 1, 2019, such amounts were recognized in revenue as tenant reimbursements. Additional rent where we pay the associated costs directly to third-party vendors and are reimbursed by our tenants are recognized and recorded on a gross basis, with the corresponding expense recognized in property expenses or real estate taxes. Prior to the adoption of Topic 842, recoverable costs were generally recognized and recorded on a gross basis when we were the primary obligor with respect to purchasing goods and services from third-party suppliers, had discretion in selecting the supplier, and had credit risk.

Other Property Income

Other property income primarily includes amounts recorded in connection with transient daily parking, tenant bankruptcy settlement payments, broken deal income and property damage settlement related payments. Other property income also includes miscellaneous income from tenants, restoration fees and fees for late rental payments. Amounts recorded within other property income fall within the scope of Topic 606 and are recognized as revenue at the point in time when control of the goods or services transfers to the customer and our performance obligation is satisfied. Prior to the adoption of Topic 842 on January 1, 2019, other property income primarily included amounts recorded in connection with lease terminations, tenant bankruptcy settlement payments, broken deal income and property damage settlement payments.

Uncollectible Lease Receivables and Allowances for Tenant and Deferred Rent Receivables

We carry our current and deferred rent receivables net of allowances for amounts that may not be collected. Prior to the adoption of Topic 842 on January 1, 2019, the allowances were increased or decreased through provision for bad debts on our consolidated statements of operations. Upon the adoption of Topic 842 on January 1, 2019, the allowances are increased or decreased through rental income, and our determination of the adequacy of the Company’s allowances for tenant receivables includes a binary assessment of whether or not substantially all of the amounts due under a tenant’s lease agreement are probable of collection. Such assessment involves using a methodology that incorporates a specific identification analysis and an aging analysis and considers the current economic and business environment. This determination requires significant judgment and estimates about matters that are uncertain at the time the estimates are made, including the creditworthiness of specific tenants, specific industry trends and conditions, and general economic trends and conditions. For leases that are deemed probable of collection, revenue continues to be recorded on a straight-line basis over the lease term. For leases that are deemed not probable of collection, revenue is recorded as the lesser of (i) the amount which would be recognized on a straight-line basis or (ii) cash that has been received from the tenant, including deferred revenue, with any tenant and deferred rent receivable balances charged as a direct write-off against rental income in the period of the change in the collectability determination.

For tenant and deferred rent receivables associated with leases whose rents are deemed probable of collection under Topic 842, we may record an allowance under other authoritative GAAP using a methodology that incorporates a specific identification analysis and an aging analysis and considers the current economic and business environment. This determination requires significant judgment and estimates about matters that are uncertain at the time the estimates are made, including the creditworthiness of specific tenants, specific industry trends and conditions, and general economic trends and conditions. Tenant and deferred rent receivables deemed probable of collection are carried net of allowances for uncollectible accounts, with increases or decreases in the allowances recorded through rental income on our consolidated statements of operations. Prior to the adoption of Topic 842 on January 1, 2019, the allowances were increased or decreased through provision for bad debts on our consolidated statements of operations.

Current tenant receivables consist primarily of amounts due for contractual lease payments and reimbursements of common area maintenance expenses, property taxes, and other costs recoverable from tenants. With respect to the allowance for uncollectible tenant receivables, the specific identification methodology analysis relies on factors such as the age and nature of the receivables, the payment history and financial condition of the tenant, our assessment of the tenant’s ability to meet its lease obligations, and the status of negotiations of any disputes with the tenant.

Deferred rent receivables represent the amount by which the cumulative straight-line rental revenue recorded to date exceeds cash rents billed to date under the lease agreement. With respect to the allowance for deferred rent receivables, given the longer-term nature of these receivables, the specific identification methodology analysis evaluates each of our significant tenants and any tenants on our internal watchlist and relies on factors such as each tenant’s financial condition and its ability to meet its lease obligations. We evaluate our reserve levels quarterly based on changes in the financial condition of tenants and our assessment of the tenant’s ability to meet its lease obligations, overall economic conditions, and the current business environment.

Acquisitions

Acquisitions of operating properties and development and redevelopment opportunities generally do not meet the definition of a business and are accounted for as asset acquisitions, as substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets. For these asset acquisitions, we record the acquired tangible and intangible assets and assumed liabilities based on each asset’s and liability’s relative fair value at the acquisition date of the total purchase price plus any capitalized acquisition costs. We record the acquired tangible and intangible assets and assumed liabilities of acquisitions of operating properties and development and redevelopment opportunities that meet the accounting criteria to be accounted for as business combinations at fair value at the acquisition date. Transaction costs associated with asset acquisitions, including costs incurred during negotiation, are capitalized in addition to the purchase price of the acquisition.

The acquired assets and assumed liabilities for an acquisition generally include but are not limited to (i) land and improvements, buildings and improvements, undeveloped land and construction in progress and (ii) identified tangible and intangible assets and liabilities associated with in-place leases, including tenant improvements, leasing costs, value of above-market and below-market operating leases and ground leases, acquired in-place lease values and tenant relationships, if any. Any debt assumed and equity (including common units of the Operating Partnership) issued in connection with a property acquisition is recorded at fair value on the date of acquisition.

The fair value of land and improvements is derived from comparable sales of land and improvements within the same submarket and/or region. The fair value of buildings and improvements, tenant improvements and leasing costs considers the value of the property as if it was vacant as well as current replacement costs and other relevant market rate information.

The fair value of the above-market or below-market component of an acquired in-place operating lease is based upon the present value (calculated using a market discount rate) of the difference between (i) the contractual rents to be paid pursuant to the lease over its remaining non-cancellable lease term and (ii) our estimate of the rents that would be paid using fair market rental rates and rent escalations at the date of acquisition measured over the remaining non-cancellable term of the lease for above-market operating leases and the initial non-cancellable term plus the term of any below-market fixed rate renewal options, if applicable, for below-market operating leases. Our below-market operating leases generally do not include fixed rate or below-market renewal options. The amounts recorded for above-market operating leases are included in deferred leasing costs and acquisition-related intangible assets, net on the balance sheet and are amortized on a straight-line basis as a reduction of rental income over the remaining term of the applicable leases. The amounts recorded for below-market operating leases are included in deferred revenue and acquisition-related intangible liabilities, net on the balance sheet and are amortized on a straight-line basis as an increase to rental income over the remaining term of the applicable leases plus the term of any below-market fixed rate renewal options, if applicable. The amortization of a below-market ground lease obligation is recorded as an increase to ground lease expense in the consolidated statements of operations for the periods presented. The amortization of an 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 fair value of acquired in-place leases is derived based on our assessment of lost revenue and costs incurred for the period required to lease the “assumed vacant” property to the occupancy level when purchased. The amount recorded for acquired in-place leases is included in deferred leasing costs and acquisition-related intangible assets, net on the balance sheet and amortized as an increase to depreciation and amortization expense over the remaining term of the applicable leases. Fully amortized intangible assets are written off each quarter.

Operating Properties

Operating properties are generally carried at historical cost less accumulated depreciation. Properties held for sale are reported at the lower of the carrying value or the fair value less estimated cost to sell. The cost of operating properties includes the purchase price or development costs of the properties. Costs incurred for the renovation and betterment of the operating properties are capitalized to our investment in that property. Maintenance and repairs are charged to expense as incurred.

When evaluating properties to be held and used for potential impairment, we first evaluate whether there are any indicators of impairment for any of our properties. If any impairment indicators are present for a specific property, we then evaluate the regional market conditions that could reasonably affect the property. If there are negative changes and trends in that regional market, we then perform an undiscounted cash flow analysis and compare the net carrying amount of the property to the property’s estimated undiscounted future cash flow over the anticipated holding period. If the estimated undiscounted future cash flow is less than the net carrying amount of the property, we perform an impairment loss calculation to determine if the fair value of the property is less than the net carrying value of the property. Our impairment loss calculation compares the net carrying amount of the property to the property’s estimated fair value, which may be based on estimated discounted future cash flow calculations or third-party valuations or appraisals. We would recognize an impairment loss if the property's net carrying amount exceeds the property's estimated fair value. If we were to recognize an impairment loss, the estimated fair value of the property becomes its new cost basis. For a depreciable long-lived asset, the new cost basis would be depreciated (amortized) over the remaining useful life of that asset.

Cost Capitalization

All costs clearly associated with the development, redevelopment and construction of a property are capitalized as project costs, including internal compensation costs. In addition, the following costs are capitalized as project costs during periods in which activities necessary to prepare development and redevelopment properties for their intended use are in progress: pre-construction costs essential to the development of the property, interest, real estate taxes and insurance.

•For office, life science and retail development and redevelopment properties that are pre-leased, we cease capitalization when revenue recognition commences, which is upon substantial completion of tenant improvements deemed to be the Company’s asset for accounting purposes.

•For office, life science and retail development and redevelopment properties that are not pre-leased, we may not immediately build out the tenant improvements. Therefore, we cease capitalization when revenue recognition commences upon substantial completion of the tenant improvements deemed to be the Company's asset for accounting purposes, but in any event, no later than one year after the cessation of major construction activities. We also cease capitalization on a development or redevelopment property when activities necessary to prepare the property for its intended use have been suspended.

•For office, life science and retail development or redevelopment properties with multiple tenants and phased leasing, we cease capitalization and begin depreciation on the portion of the development or redevelopment property for which revenue recognition has commenced.

•For residential development properties, we cease capitalization when the property is substantially complete and available for occupancy.

Once major base building construction activities have ceased and the development or redevelopment property or phases of the development or redevelopment project is placed in service, which may occur in phases or for an entire building or project, the costs capitalized to construction in progress are transferred to land and improvements, buildings and improvements, and deferred leasing costs on our consolidated balance sheets as the historical cost of the property.

Depreciation and Amortization of Buildings and Improvements

The costs of buildings and improvements and tenant improvements are depreciated using the straight-line method of accounting over the estimated useful lives set forth in the table below. Depreciation expense for buildings and improvements for the three years ended December 31, 2020, 2019, and 2018 was $244.8 million, $211.9 million, and $198.6 million, respectively.

Asset Description	Depreciable Lives
Buildings and improvements	25 – 40 years
Tenant improvements	1 – 20 years (1)

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(1)Tenant improvements are amortized over the shorter of the lease term or the estimated useful life. 

Real Estate Assets Held for Sale, Dispositions and Discontinued Operations

A real estate asset is classified as held for sale when certain criteria are met, including but not limited to the availability of the asset for immediate sale, the existence of an active program to locate a buyer and the probable sale or transfer of the asset within one year. If such criteria are met, we present the applicable assets and liabilities related to the real estate asset, if material, separately on the balance sheet as held for sale and we would cease to record depreciation and amortization expense. Real estate assets held for sale are reported at the lower of their carrying value or their estimated fair value less the estimated costs to sell. As of December 31, 2020 and 2019, we did not have any properties classified as held for sale.

Property disposals representing a strategic shift that have (or will have) a major effect on the Company’s operations and financial results, such as a major line of business, a major geographical area or a major equity investment, are required to be presented as discontinued operations. If we were to determine that a property disposition represents a strategic shift, the revenues, expenses and net gain (loss) on dispositions of the property would be recorded in discontinued operations for all periods presented through the date of the applicable disposition. The operations of the properties sold during the years ended December 31, 2020, 2019 and 2018 are presented in continuing operations as they did not represent a strategic shift in the Company’s operations and financial results.

The net gains (losses) on dispositions of non-depreciable real estate property, including land, are reported in the consolidated statements of operations as gains (losses) on sale of land within continuing operations in the period the land is sold. The net gains (losses) on dispositions of depreciable real estate property are reported in the consolidated statements of operations as gains on sales of depreciable operating properties within continuing operations in the period the property is sold.

Cash and Cash Equivalents

We consider all highly-liquid investments with original maturities of three months or less to be cash equivalents.

Restricted Cash

Restricted cash consists of cash proceeds from dispositions that are temporarily held at qualified intermediaries for purposes of facilitating potential Section 1031 Exchanges and cash held in escrow related to acquisition and disposition holdbacks. Restricted cash also includes cash held as collateral to provide credit enhancement for the Operating Partnership’s mortgage debt, including cash reserves for capital expenditures, tenant improvements and property taxes. As of December 31, 2020, we had $74.9 million of restricted cash held at qualified intermediaries for the purpose of facilitating Section 1031 Exchanges. In January 2021, the Section 1031 Exchange was terminated and the cash proceeds were released from the qualified intermediary. We did not have any restricted cash held at qualified intermediaries for the purpose of facilitating Section 1031 Exchanges at December 31, 2019.

Marketable Securities / Deferred Compensation Plan

Marketable securities reported in our consolidated balance sheets represent the assets held in connection with the Kilroy Realty Corporation 2007 Deferred Compensation Plan (the “Deferred Compensation Plan”) (see Note 16 “Employee Benefit Plans” for additional information). The Deferred Compensation Plan assets are held in a limited rabbi trust and invested in various mutual and money market funds. As a result, the marketable securities are treated as trading securities for financial reporting purposes and are adjusted to fair value at the end of each accounting period, with the corresponding gains and losses recorded in interest income and other net investment gains (losses).

At the time eligible management employees (“Participants”) defer compensation or earn mandatory Company contributions, or if we were to make a discretionary contribution, we record compensation cost and a corresponding deferred compensation plan liability, which is included in accounts payable, accrued expenses, and other liabilities on our consolidated balance sheets. This liability is adjusted to fair value at the end of each accounting period based on the performance of the benchmark funds selected by each Participant, and the impact of adjusting the liability to fair value is recorded as an increase or decrease to compensation cost. The impact of adjusting the deferred compensation plan liability to fair value and the changes in the value of the marketable securities held in connection with the Deferred Compensation Plan generally offset and therefore do not significantly impact net income.

Deferred Leasing Costs

Costs incurred in connection with successful property leasing are capitalized as deferred leasing costs and classified as investing activities in the statement of cash flows. Under Topic 842, initial direct costs include only those costs that are incremental to the arrangement and would not have been incurred if the lease had not been obtained. As a result, subsequent to the adoption of Topic 842 on January 1, 2019, deferred leasing costs consist of leasing commissions paid to external third party brokers and lease incentives, and the Company no longer capitalizes internal leasing costs and third-party legal leasing costs. Prior to the adoption of Topic 842, deferred leasing costs consisted primarily of leasing commissions, lease incentives, legal costs and certain internal payroll costs. Deferred leasing costs are amortized using the straight-line method of accounting over the lives of the leases which generally range from one to 20 years. We may reevaluate the remaining useful lives of leasing costs as the creditworthiness of our tenants and economic and market conditions change. If we determine that the estimated remaining life of a lease has changed, we adjust the amortization period accordingly. Fully amortized deferred leasing costs are written off each quarter.

Deferred Financing Costs

Financing costs related to the origination or assumption of long-term debt are deferred and generally amortized using the straight-line method of accounting, which approximates the effective interest method, over the contractual terms of the applicable financings. Fully amortized deferred financing costs are written off when the corresponding financing is repaid.

Debt Discounts and Premiums

Original issuance debt discounts and discounts/premiums related to recording debt acquired in connection with operating property acquisitions at fair value are generally amortized and accreted on a straight-line basis, which approximates the effective interest method. Discounts are recorded as additional interest expense from date of issuance or acquisition through the contractual maturity date of the related debt. Premiums are recorded as a reduction to interest expense from the date of issuance or acquisition through the contractual maturity date of the related debt.

Noncontrolling Interests - Common Units of the Operating Partnership in the Company's Consolidated Financial Statements

Common units of the Operating Partnership within noncontrolling interests in the Company’s consolidated financial statements represent the common limited partnership interests in the Operating Partnership not held by the Company (“noncontrolling common units”). Noncontrolling common units are presented in the equity section of the

Company’s consolidated balance sheets and are reported at their proportionate share of the net assets of the Operating Partnership. Noncontrolling interests with redemption provisions that permit the issuer to settle in either cash or shares of common stock must be further evaluated to determine whether equity or temporary equity classification on the balance sheet is appropriate. Since the common units contain such a provision, we evaluated the accounting guidance and determined that the common units qualify for equity presentation in the Company’s consolidated financial statements. Net income attributable to noncontrolling common units is allocated based on their relative ownership percentage of the Operating Partnership during the reported period. The noncontrolling interest ownership percentage is determined by dividing the number of noncontrolling common units by the total number of common units outstanding. The issuance or redemption of additional shares of common stock or common units results in changes to the noncontrolling interest percentage as well as the total net assets of the Company. As a result, all equity transactions result in an allocation between equity and the noncontrolling interest in the Company’s consolidated balance sheets and statements of equity to account for the changes in the noncontrolling interest ownership percentage as well as the change in total net assets of the Company.

Noncontrolling Interests in Consolidated Property Partnerships

Noncontrolling interests in consolidated property partnerships represent the equity interests held by unrelated third parties in our three consolidated property partnerships (see Note 11 “Noncontrolling Interests on the Company’s Consolidated Financial Statements” and see Note 12 “Noncontrolling Interests on the Operating Partnership’s Consolidated Financial Statements”). Noncontrolling interests in consolidated property partnerships are not redeemable and are presented as permanent equity in the Company's consolidated balance sheets. We account for the noncontrolling interests in consolidated property partnerships using the hypothetical liquidation at book value (“HLBV”) method to attribute the earnings or losses of the consolidated property partnerships between the controlling and noncontrolling interests. Under the HLBV method, the amounts reported as noncontrolling interests in consolidated property partnerships in the consolidated balance sheets represent the amounts the noncontrolling interests would hypothetically receive at each balance sheet reporting date under the liquidation provisions of the governing agreements assuming the net assets of the consolidated property partnerships were liquidated at recorded amounts and distributed between the controlling and noncontrolling interests in accordance with the governing documents. The net income attributable to noncontrolling interests in consolidated property partnerships in the consolidated statements of operations is associated with the increase or decrease in the noncontrolling interest holders’ contractual claims on the respective entities’ balance sheets assuming a hypothetical liquidation at the end of that reporting period when compared with their claims on the respective entities’ balance sheets assuming a hypothetical liquidation at the beginning of that reporting period, after removing any contributions or distributions.

Common Partnership Interests on the Operating Partnership’s Consolidated Balance Sheets

The common units held by the Company and the noncontrolling common units held by the common limited partners are both presented in the permanent equity section of the Operating Partnership’s consolidated balance sheets in partners’ capital. The redemption rights of the noncontrolling common units permit us to settle the redemption obligation in either cash or shares of the Company’s common stock at our option (see Note 11 “Noncontrolling Interests on the Company’s Consolidated Financial Statements” for additional information).

Noncontrolling Interests on the Operating Partnership’s Consolidated Financial Statements

Noncontrolling interests in the Operating Partnership’s consolidated financial statements include the noncontrolling interest in property partnerships (see Note 12 “Noncontrolling Interests on the Operating Partnership’s Consolidated Financial Statements”). As of December 31, 2019, noncontrolling interests in the Operating Partnership’s consolidated financial statements also included the Company’s 1.0% general partnership interest in Kilroy Realty Finance Partnership, L.P. in the permanent equity section of the Operating Partnership’s consolidated balance sheets given that these interests were not convertible or redeemable into any other ownership interest of the Company or the Operating Partnership.

Equity Offerings

Underwriting commissions and offering costs incurred in connection with common equity offerings and our at-the-market stock offering program (see Note 13 “Stockholders’ Equity of the Company”) are reflected as a reduction of additional paid-in capital. Issuance costs incurred in connection with preferred equity offerings are reflected as a reduction of the carrying value of the preferred equity.

Sales of our common stock under forward equity sale agreements (such as those under the forward equity offering entered into in February 2020 and those under the 2018 At-The-Market Program, as discussed in Note 13 “Stockholders’ Equity of the Company”) meet the derivatives and hedging guidance scope exception to be accounted for as equity instruments based on the following assessment: (i) none of the agreements’ exercise contingencies were based on observable markets or indices besides those related to the market for our own stock price and operations; and (ii) none of the settlement provisions precluded the agreements from being indexed to our own stock.

The net proceeds from any equity offering of the Company are generally contributed to the Operating Partnership in exchange for a number of common units equivalent to the number of shares of common stock issued and are reflected in the Operating Partnership’s consolidated financial statements as an increase in partners’ capital.

Share-based Incentive Compensation Accounting

Compensation cost for all share-based awards, including options, requires measurement at estimated fair value on the grant date. Compensation cost is recognized on a straight-line basis over the service vesting period, which represents the requisite service period. The grant date fair value of market measure-based share-based compensation plans are calculated using a Monte Carlo simulation pricing model. The grant date fair value of stock option grants is calculated using the Black-Scholes valuation model. Equity awards settled in cash are valued at the fair value of our common stock on the period end date through the settlement date. Equity awards settled in cash are remeasured at each reporting period and are recognized as a liability in the consolidated balance sheet during the vesting period until settlement. Forfeitures of all share-based awards are recognized when they occur.

For share-based awards in which the performance period precedes the grant date, we recognize compensation cost over the requisite service period, which includes both the performance and service vesting periods, using the accelerated attribution expense method. The requisite service period begins on the date the Executive Compensation Committee authorizes the award and adopts any relevant performance measures.

For share-based awards with performance-based measures, the total estimated compensation cost is based on our most recent estimate of the probable achievement of the pre-established specific corporate performance measures. These estimates are based on actual results and our latest internal forecasts for each performance measure. For share-based awards with market measures, the total estimated compensation cost is based on the fair value of the award at the grant date. For share-based awards with performance-based measures and market measures, the total estimated compensation cost is based on the fair value per share at the grant date multiplied by our most recent estimate of the number of shares to be earned based on actual results and the probable achievement of the pre-established corporate performance measures based on our latest internal forecasts.

In accordance with the provisions of our share-based incentive compensation plan, we accept the return of shares of Company common stock, at the current quoted market price, from employees to satisfy minimum statutory tax-withholding requirements related to shares that vested during the period.

For share-based awards granted by the Company, the Operating Partnership issues a number of common units equal to the number of shares of common stock ultimately granted by the Company in respect of such awards.

Basic and Diluted Net Income Available to Common Stockholders per Share

Basic net income available to common stockholders per share is computed by dividing net income available to common stockholders, after preferred distributions and the allocation of income to participating securities, by the

weighted-average number of shares of common stock outstanding for the period. Diluted net income available to common stockholders per share is computed by dividing net income available for common stockholders, after preferred distributions and the allocation of income to participating securities, by the sum of the weighted-average number of shares of common stock outstanding for the period plus the assumed exercise of all dilutive securities. The impact of the outstanding common units is considered in the calculation of diluted net income available to common stockholders per share. The common units are not reflected in the diluted net income available to common stockholders per share calculation because the exchange of common units into common stock is on a one for one basis, and the common units are allocated net income on a per share basis equal to the common stock (see Note 21 “Net Income Available to Common Stockholders Per Share of the Company”). Accordingly, any exchange would not have any effect on diluted net income (loss) available to common stockholders per share.

Nonvested share-based payment awards (including nonvested restricted stock units (“RSUs”), vested market-measure RSUs and vested dividend equivalents issued to holders of RSUs) containing nonforfeitable rights to dividends or dividend equivalents are accounted for as participating securities and included in the computation of basic and diluted net income available to common stockholders per share pursuant to the two-class method. The dilutive effect of shares issuable under executed forward equity sale agreements, if any, and stock options are reflected in the weighted average diluted outstanding shares calculation by application of the treasury stock method. The dilutive effect of the outstanding nonvested shares of common stock (“nonvested shares”) and RSUs that have not yet been granted but are contingently issuable under the share-based compensation programs is reflected in the weighted average diluted shares calculation by application of the treasury stock method at the beginning of the quarterly period in which all necessary conditions have been satisfied.

Basic and Diluted Net Income Available to Common Unitholders per Unit

Basic net income available to common unitholders per unit is computed by dividing net income available to common unitholders, after preferred distributions and the allocation of income to participating securities, by the weighted-average number of vested common units outstanding for the period. Diluted net income available to common unitholders per unit is computed by dividing net income available to common unitholders, after preferred distributions and the allocation of income to participating securities, by the sum of the weighted-average number of common units outstanding for the period plus the assumed exercise of all dilutive securities.

The dilutive effect of stock options, outstanding nonvested shares, RSUs, awards containing nonforfeitable rights to dividend equivalents and shares issuable under executed forward equity sale agreements, if any, are reflected in diluted net income available to common unitholders per unit in the same manner as noted above for net income available to common stockholders per share.

Fair Value Measurements

The fair values of our financial assets and liabilities are disclosed in Note 19, “Fair Value Measurements and Disclosures,” to our consolidated financial statements. The only financial assets recorded at fair value on a recurring basis in our consolidated financial statements are our marketable securities. We elected not to apply the fair value option for any of our eligible financial instruments or other items.

We determine the estimated fair value of financial assets and liabilities utilizing a hierarchy of valuation techniques based on whether the inputs to a fair value measurement are considered to be observable or unobservable in a marketplace. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect our market assumptions. This hierarchy requires the use of observable market data when available. The following is the fair value hierarchy:

•Level 1 – quoted prices for identical instruments in active markets;

•Level 2 – quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and

•Level 3 – fair value measurements derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

We determine the fair value for the marketable securities using quoted prices in active markets for identical assets. Our other financial instruments, which are only disclosed at fair value, are comprised of secured debt, unsecured senior notes, unsecured line of credit and unsecured term loan facility.

We generally determine the fair value of our secured debt, unsecured debt, unsecured line of credit and unsecured term loan facility, prior to its repayment in August 2020, by performing discounted cash flow analyses using an appropriate market discount rate. We calculate the market rate by obtaining period-end treasury rates for maturities that correspond to the maturities of our fixed-rate debt and then adding an appropriate credit spread based on information obtained from third-party financial institutions. These credit spreads take into account factors, including but not limited to, our credit profile, the tenure of the debt, amortization period, whether the debt is secured or unsecured, and the loan-to-value ratio of the debt to the collateral. These calculations are significantly affected by the assumptions used, including the discount rate, credit spreads and estimates of future cash flow. We calculate the market rate of our unsecured line of credit and unsecured term loan facility by obtaining the period-end London Interbank Offered Rate (“LIBOR”) and then adding an appropriate credit spread based on our credit ratings, and the amended terms of our unsecured line of credit and unsecured term loan facility agreement. We determine the fair value of each of our publicly traded unsecured senior notes based on their quoted trading price at the end of the reporting period, if such prices are available.

Carrying amounts of our cash and cash equivalents, restricted cash and accounts payable approximate fair value due to their short-term maturities.

Income Taxes

We have elected to be taxed as a REIT under Sections 856 through 860 of the Code. To qualify as a REIT, we must distribute annually at least 90% of our adjusted taxable income, as defined in the Code, to our stockholders and satisfy certain other organizational and operating requirements. We generally will not be subject to federal income taxes if we distribute 100% of our taxable income for each year to our stockholders. If we fail to qualify as a REIT in any taxable year, we will be subject to federal income taxes on our taxable income at regular corporate rates and we may not be able to qualify as a REIT for four subsequent taxable years. Even if we qualify for taxation as a REIT, we may be subject to certain state and local taxes on our income and property and to federal income taxes and excise taxes on our undistributed taxable income. We believe that we have met all of the REIT distribution and technical requirements for the years ended December 31, 2020, 2019 and 2018, and we were not subject to any federal income taxes (see Note 25 “Tax Treatment of Distributions” for additional information). We intend to continue to adhere to these requirements and maintain the Company’s REIT status. Accordingly, no provision for income taxes has been made in the accompanying financial statements.

In addition, any taxable income from our taxable REIT subsidiaries, which were formed in 2002, 2018, 2019 and 2020, are subject to federal, state, and local income taxes. For the years ended December 31, 2020, 2019 and 2018 the taxable REIT subsidiaries had de minimis taxable income.

Uncertain Tax Positions

We include favorable tax positions in the calculation of tax liabilities if it is more likely than not that our adopted tax position will prevail if challenged by tax authorities.

We evaluated the potential impact of identified uncertain tax positions for all tax years still subject to audit under state and federal income tax law and concluded that we did not have any unrecognized tax benefits or any additional tax liabilities as of December 31, 2020 or 2019. As of December 31, 2020, the years still subject to audit are 2016 through 2020 under the California state income tax law and 2017 through 2020 under the federal income tax law.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported periods. Actual results could differ from those estimates.

Segments

We currently operate in one operating segment, our office and life science properties segment.

Concentration of Credit Risk

All of our properties and development and redevelopment projects are owned and all of our business is currently conducted in the state of California with the exception of the ownership and operation of eight office properties, one development project in the tenant improvement phase and one future development project located in the state of Washington. The ability of tenants to honor the terms of their leases is dependent upon the economic, regulatory, and social factors affecting the communities in which our tenants operate.

We have deposited cash with financial institutions that is insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000 per institution. As of December 31, 2020 and 2019, we had cash accounts in excess of FDIC insured limits.

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Acquisitions

12 Months Ended

Dec. 31, 2020

Asset Acquisitions [Abstract]

Acquisitions

Acquisitions

Operating Property Acquisitions

We did not acquire any operating properties during the year ended December 31, 2020. During the year ended December 31, 2019, we acquired the 19-building creative office campus listed below in one transaction from an unrelated third party.

Property	Date of Acquisition	Number of Buildings	Rentable Square Feet (unaudited)	Purchase Price (in millions) (1)
2019 Acquisitions
3101-3243 La Cienega Boulevard, Culver City, CA (2)	October 15, 2019	19	151,908	$	186.0

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(1)Excludes acquisition-related costs.

(2)The results of operations for the properties acquired during 2019 contributed $3.7 million to revenue and a net loss of $0.1 million for the year ended December 31, 2019 primarily due to a write-off of lease-related intangible assets as a result of an early lease termination during the year ended December 31, 2019.

The related assets, liabilities and results of operations of the acquired properties are included in the consolidated financial statements as of the date of acquisition. The following table summarizes the estimated relative fair values of the assets and liabilities assumed at the acquisition date for our 2019 operating property acquisitions:

	Total 2019 Operating Property Acquisition (1)
Assets
Land and improvements	$	150,561
Buildings and improvements (2)	30,932
Deferred leasing costs and acquisition-related intangible assets (3)	12,063
Right of use ground lease asset (4)	13,334
Total assets acquired	$	206,890
Liabilities
Acquisition-related intangible liabilities (5)	$	9,950
Ground lease liability (4)	10,940
Total liabilities assumed	$	20,890
Net assets and liabilities acquired	$	186,000

________________________ 

(1)The purchase price of the acquisition completed during the year ended December 31, 2019 was less than 10% of the Company’s total assets as of December 31, 2018.

(2)Represents buildings, building improvements and tenant improvements.

(3)Represents in-place leases (approximately $9.2 million with a weighted average amortization period of 3.3 years) and leasing commissions (approximately $2.9 million with a weighted average amortization period of 3.5 years).

(4)We evaluated the ground lease assumed in connection with the 2019 operating property acquisition and concluded it met the criteria to be classified as an operating lease. The discount rate used in determining the present value of the minimum future lease payments was 4.79%. The right of use asset ground lease asset is equal to the ground lease liability adjusted for above and below market intangibles and deferred leasing costs. Refer to Note 18 “Commitments and Contingencies” for further discussion of the Company's ground lease obligations.

(5)Represents below-market leases (approximately $10.0 million with a weighted average amortization period of 3.5 years).

Development Project Acquisitions

We did not acquire any development sites during the year ended December 31, 2020. During the year ended December 31, 2019, we acquired the following development sites in two transactions from unrelated third parties. The acquisitions were funded from various sources of liquidity including proceeds from the Company’s unsecured revolving credit facility, the issuance of debt and the settlement of the Company’s 2018 forward equity sale agreements.

Project	Date of Acquisition	City/Submarket	Purchase Price (in millions)
2019 Acquisitions
1335 Broadway & 901 Park Boulevard, San Diego, CA (1)	August 19, 2019	East Village	$	40.0
Seattle CBD Project (2)	December 12, 2019	Seattle CBD	133.0
Total 2019 Acquisitions			$	173.0

_______________________ 

(1)Excludes acquisition-related costs. In connection with this acquisition, we also recorded $4.0 million in accrued liabilities and environmental remediation liabilities at the date of acquisition, which are not included in the purchase price above. As of December 31, 2019, the purchase price and our current estimate of assumed liabilities are included in undeveloped land and construction in progress and the assumed liabilities are included in accounts payable, accrued expenses and other liabilities on the Company’s consolidated balance sheets.

(2)Excludes acquisition-related costs. In connection with this acquisition, we also recorded $6.3 million in accrued liabilities and environmental remediation liabilities at the date of acquisition, which are not included in the purchase price above. As of December 31, 2019, the purchase price and our current estimate of assumed liabilities are included in undeveloped land and construction in progress and the assumed liabilities are included in accounts payable, accrued expenses and other liabilities on the Company’s consolidated balance sheets. In addition, as of December 31, 2020 and 2019, the Company had $10.0 million in restricted cash, which is excluded from the purchase price above, related to this acquisition which may be payable to the seller only if certain events occur within three years following the date of acquisition.

In addition to the acquisitions listed above, during 2019, we acquired an additional land parcel for an existing development project for $99.5 million.

Acquisition Costs

During the years ended December 31, 2020, 2019, and 2018, we capitalized $0.3 million, $1.6 million, and $3.8 million, respectively, of acquisition costs.

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Dispositions

12 Months Ended

Dec. 31, 2020

Discontinued Operations and Disposal Groups [Abstract]

Dispositions

Dispositions

Operating Property Dispositions

The following table summarizes the operating properties sold during the years ended December 31, 2020, 2019 and 2018:

Location	Month of Disposition	Number of Buildings	Rentable Square Feet (unaudited)	Sales Price (in millions) (1)
2020 Dispositions
331 Fairchild Drive, Mountain View, CA	December	1	87,147	$	75.9
Total 2020 Dispositions		1	87,147	$	75.9
2019 Dispositions
2829 Townsgate Road, Thousand Oaks, CA	May	1	84,098	$	18.3
2211 Michelson Drive, Irvine, CA	October	1	271,556	115.5
Total 2019 Dispositions		2	355,654	$	133.8
2018 Dispositions
1310-1327 Chesapeake Terrace, Sunnyvale, CA	November	4	266,982	$	160.3
Plaza Yarrow Bay Properties (2)	November	4	279,924	134.5
23925, 23975, & 24025 Park Sorrento, Calabasas, CA	December	3	225,340	78.2
Total 2018 Dispositions		11	772,246	$	373.0

____________________

(1)Represents gross sales price before broker commissions and closing costs.

(2)The Plaza Yarrow Bay Properties include the following properties: 10210, 10220 and 10230 NE Points Drive & 3933 Lake Washington Boulevard NE in Kirkland, Washington.

The total gains on the sales of the operating properties sold during the years ended December 31, 2020, 2019 and 2018 were $35.5 million, $36.8 million and $142.9 million, respectively.

Land Dispositions

We did not dispose of any land parcels during the years ended December 31, 2020 and 2019. During the year ended December 31, 2018, in connection with the Plaza Yarrow Bay Properties disposition listed above, we recognized a gain on sale of land of $11.8 million.

Restricted Cash Related to Dispositions

As of December 31, 2020, approximately $74.9 million of net proceeds related to the operating property disposition during the year ended December 31, 2020 were temporarily being held at a qualified intermediary at our direction, for the purpose of facilitating a Section 1031 Exchange. The cash proceeds were included in restricted cash on our consolidated balance sheets at December 31, 2020. During January 2021, the Section 1031 Exchange was terminated and the cash proceeds were released from the qualified intermediary. We did not have any restricted cash related to dispositions or Section 1031 Exchanges as of December 31, 2019.

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Deferred Leasing Costs and Acquisition-Related Intangible Assets and Liabilities, net

12 Months Ended

Dec. 31, 2020

Goodwill and Intangible Assets 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, and in-place leases) and intangible liabilities (acquired value of below-market operating leases) as of December 31, 2020 and 2019:

	December 31, 2020		December 31, 2019
	(in thousands)
Deferred Leasing Costs and Acquisition-related Intangible Assets, net:
Deferred leasing costs	$	300,556	$	286,026
Accumulated amortization	(104,277)		(100,145)
Deferred leasing costs, net	196,279		185,881
Above-market operating leases	—		611
Accumulated amortization	—		(116)
Above-market operating leases, net	—		495
In-place leases	40,323		58,076
Accumulated amortization	(25,653)		(31,647)
In-place leases, net	14,670		26,429
Total deferred leasing costs and acquisition-related intangible assets, net	$	210,949	$	212,805
Acquisition-related Intangible Liabilities, net: (1)
Below-market operating leases	$	26,405	$	51,263
Accumulated amortization	(13,060)		(27,171)
Below-market operating leases, net	13,345		24,092
Total acquisition-related intangible liabilities, net	$	13,345	$	24,092

____________________

(1)Included in deferred revenue and acquisition-related intangible liabilities, net in the consolidated balance sheets.

The following table sets forth amortization related to deferred leasing costs and acquisition-related intangibles for the years ended December 31, 2020, 2019 and 2018.

	Year Ended December 31,
	2020		2019		2018
	(in thousands)
Deferred leasing costs (1)	$	33,624	$	35,779	$	34,341
Above-market operating leases (2)	495		192		444
In-place leases (1)	11,759		18,615		15,915
Below-market ground lease obligation (3)	—		—		8
Below-market operating leases (4)	(10,748)		(9,398)		(10,192)
Above-market ground lease obligation (3)	—		—		(101)
Total	$	35,130	$	45,188	$	40,415

____________________

(1)    The amortization of deferred leasing costs and in-place leases is recorded to depreciation and amortization expense and the amortization of lease incentives is recorded as a reduction to rental income 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)    Upon adoption of Topic 842 on January 1, 2019 (refer to Note 2 “Basis of Presentation and Significant Accounting Policies”), we no longer separately recognize above or below-market ground lease obligations. Refer to Note 18 “Commitments and Contingencies” for further discussion of our ground lease obligations.

(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.

The following table sets forth the estimated annual amortization expense related to deferred leasing costs and acquisition-related intangibles as of December 31, 2020 for future periods:

Year	Deferred Leasing Costs		In-Place Leases		Below-Market Operating Leases (1)
	(in thousands)
2021	$	31,048	$	6,531	$	(4,152)
2022	28,334		3,885		(3,167)
2023	24,470		1,534		(1,486)
2024	21,545		584		(812)
2025	19,726		473		(710)
Thereafter	71,156		1,663		(3,018)
Total	$	196,279	$	14,670	$	(13,345)

____________________

(1)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.

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Receivables

12 Months Ended

Dec. 31, 2020

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 December 31, 2020 and 2019:

	December 31, 2020		December 31, 2019
	(in thousands)
Current receivables	$	13,806	$	27,660
Allowance for uncollectible tenant receivables (1)	(1,799)		(1,171)
Current receivables, net	$	12,007	$	26,489

____________________

(1)Refer to Note 2 “Basis of Presentation and Significant Accounting Policies” for discussion of our accounting policies related to the allowance for uncollectible tenant receivables for additional information regarding changes in our allowance for uncollectible tenant receivables.

Deferred Rent Receivables, net

Deferred rent receivables, net consisted of the following as of December 31, 2020 and 2019:

	December 31, 2020		December 31, 2019
	(in thousands)
Deferred rent receivables	$	387,462	$	339,489
Allowance for deferred rent receivables (1)	(804)		(1,552)
Deferred rent receivables, net	$	386,658	$	337,937

____________________

(1)Refer to Note 2 “Basis of Presentation and Significant Accounting Policies” for discussion of our accounting policies related to the allowance for deferred rent receivables for additional information regarding changes in our allowance for deferred rent receivables.

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Prepaid Expenses and Other Assets, Net

12 Months Ended

Dec. 31, 2020

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Prepaid Expenses and Other Assets, Net

Prepaid Expenses and Other Assets, Net

Prepaid expenses and other assets, net consisted of the following at December 31, 2020 and 2019:

	December 31, 2020		December 31, 2019
	(in thousands)
Furniture, fixtures and other long-lived assets, net	$	43,367	$	35,286
Prepaid expenses	10,193		18,724
Notes receivable, net (1)	—		1,651
Total prepaid expenses and other assets, net	$	53,560	$	55,661

____________________

(1)During the year ended December 31, 2020, the balance of the note receivable was written-off and the note receivable was placed on non-accrual status. We do not recognize interest income on non-accrual financing receivables. As of December 31, 2019, the note receivable was shown net of a valuation allowance of approximately $3.6 million.

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Secured and Unsecured Debt of the Company

12 Months Ended

Dec. 31, 2020

Debt Disclosure [Abstract]

Secured and Unsecured Debt of the Company

Secured and Unsecured Debt of the Company

In this Note 8, the “Company” refers solely to Kilroy Realty Corporation and not to any of our subsidiaries. The Company itself does not hold any indebtedness. All of our secured and unsecured debt is held directly by the Operating Partnership.

The Company generally guarantees all the Operating Partnership’s unsecured debt obligations including the unsecured revolving credit facility, the unsecured term loan facility and all of the unsecured senior notes. At December 31, 2020 and 2019, the Operating Partnership had $3.7 billion and $3.3 billion, respectively, outstanding in total, including unamortized discounts and deferred financing costs, under these unsecured debt obligations.

In addition, although the remaining $0.3 billion of the Operating Partnership’s debt as of December 31, 2020 and 2019, is secured and non-recourse to the Company, the Company provides limited customary secured debt guarantees for items such as voluntary bankruptcy, fraud, misapplication of payments and environmental liabilities.

Debt Covenants and Restrictions

One of the covenants contained within the unsecured revolving credit facility as discussed further below in Note 9 prohibits the Company from paying dividends during an event of default in excess of an amount which results in distributions to us in an amount sufficient to permit us to pay dividends to our stockholders that we reasonably believe are necessary to (a) maintain our qualification as a REIT for federal and state income tax purposes and (b) avoid the payment of federal or state income or excise tax.

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Secured and Unsecured Debt of the Operating Partnership

12 Months Ended

Dec. 31, 2020

Debt Instrument [Line Items]

Secured and Unsecured Debt of the Operating Partnership

Secured and Unsecured Debt of the Company

In this Note 8, the “Company” refers solely to Kilroy Realty Corporation and not to any of our subsidiaries. The Company itself does not hold any indebtedness. All of our secured and unsecured debt is held directly by the Operating Partnership.

The Company generally guarantees all the Operating Partnership’s unsecured debt obligations including the unsecured revolving credit facility, the unsecured term loan facility and all of the unsecured senior notes. At December 31, 2020 and 2019, the Operating Partnership had $3.7 billion and $3.3 billion, respectively, outstanding in total, including unamortized discounts and deferred financing costs, under these unsecured debt obligations.

In addition, although the remaining $0.3 billion of the Operating Partnership’s debt as of December 31, 2020 and 2019, is secured and non-recourse to the Company, the Company provides limited customary secured debt guarantees for items such as voluntary bankruptcy, fraud, misapplication of payments and environmental liabilities.

Debt Covenants and Restrictions

One of the covenants contained within the unsecured revolving credit facility as discussed further below in Note 9 prohibits the Company from paying dividends during an event of default in excess of an amount which results in distributions to us in an amount sufficient to permit us to pay dividends to our stockholders that we reasonably believe are necessary to (a) maintain our qualification as a REIT for federal and state income tax purposes and (b) avoid the payment of federal or state income or excise tax.

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 December 31, 2020 and 2019:

	Annual Stated Interest Rate (1)	GAAP Effective Rate (1)(2)	Maturity Date	December 31,
Type of Debt				2020		2019
				(in thousands)
Mortgage note payable	3.57%	3.57%	December 2026	$	166,776	$	170,000
Mortgage note payable (3)	4.48%	4.48%	July 2027	87,589		89,502
Total secured debt				$	254,365	$	259,502
Unamortized Deferred Financing Costs				(783)		(909)
Total secured debt, net				$	253,582	$	258,593

____________________

(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)The secured debt and the related properties that secure this 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.

The Operating Partnership’s secured debt was collateralized by operating properties with a combined net book value of approximately $222.0 million as of December 31, 2020.

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.

As of December 31, 2020, all of the Operating Partnership’s secured loans contained restrictions that would require the payment of prepayment penalties for the acceleration of outstanding debt. The mortgage notes payable are secured by deeds of trust on certain of our properties and the assignment of certain rents and leases associated with those properties.

Unsecured Senior Notes - Registered Offerings

In August 2020, the Operating Partnership issued $425.0 million aggregate principal amount of green unsecured senior notes in a registered public offering. The outstanding balance of the unsecured senior notes is included in unsecured debt, net of an initial issuance discount of $2.7 million, on our consolidated balance sheets. The unsecured senior notes, which are scheduled to mature on November 15, 2032, require semi-annual interest payments each May and November based on a stated annual interest rate of 2.500%. The Operating Partnership may redeem the notes at any time prior to August 15, 2032, either in whole or in part, subject to the payment of an early redemption premium prior to a par call option period commencing three months prior to maturity.

In September 2019, the Operating Partnership issued $500.0 million of aggregate principal amount of unsecured senior notes in a registered public offering. The outstanding balance of the unsecured senior notes is included in unsecured debt, net of an initial issuance discount of $0.6 million, on our consolidated balance sheets. The unsecured senior notes, which are scheduled to mature on February 15, 2030, require semi-annual interest payments each February and August based on a stated annual interest rate of 3.050%. The Operating Partnership may redeem the notes at any time prior to February 15, 2030, either in whole or in part, subject to the payment of an early redemption premium prior to a par call option period commencing three months prior to maturity.

Unsecured Senior Notes - Private Placement

In April 2020, the Operating Partnership entered into a Note Purchase Agreement in connection with the issuance and sale of $350.0 million principal amount of the Operating Partnership’s 4.270% Senior Notes due January 31, 2031 (the “Notes due 2031”), pursuant to a private placement. The Notes due 2031 mature on their due date, unless earlier redeemed or prepaid pursuant to the terms of the Note Purchase Agreement. Interest on the Notes is payable semi-annually in arrears on April 18 and October 18 of each year beginning October 18, 2020.

Unsecured Senior Notes - Early Redemption

In December 2018, at our option, we early redeemed the $250.0 million aggregate principal amount of our outstanding 6.625% unsecured senior notes that were scheduled to mature on June 1, 2020. In connection with our early redemption, we incurred a $12.6 million loss on early extinguishment of debt comprised of an $11.8 million premium paid to the note holders at the redemption date and a $0.8 million write-off of the unamortized discount and unamortized deferred financing costs.

Unsecured Senior Notes

The following table summarizes the balance and significant terms of the registered unsecured senior notes issued by the Operating Partnership and outstanding, including the issuances noted above, and including unamortized discounts of $8.3 million and $6.5 million and unamortized deferred financing costs of $21.6 million and $18.7 million as of December 31, 2020 and 2019, respectively:

					Net Carrying Amount as of December 31,
	Issuance date	Maturity date	Stated coupon rate	Effective interest rate (1)	2020		2019
					(in thousands)
2.500% Unsecured Senior Notes (2)	August 2020	November 2032	2.500%	2.560%	$	425,000	$	—
Unamortized discount and deferred financing costs					(6,332)		—
Net carrying amount					$	418,668	$	—
4.270% Unsecured Senior Notes (3)	April 2020	January 2031	4.270%	4.270%	$	350,000	$	—
Unamortized discount and deferred financing costs					(1,825)		—
Net carrying amount					$	348,175	$	—
3.050% Unsecured Senior Notes (4)	September 2019	February 2030	3.050%	3.064%	$	500,000	$	500,000
Unamortized discount and deferred financing costs					(5,399)		(5,998)
Net carrying amount					$	494,601	$	494,002
4.750% Unsecured Senior Notes (5)	November 2018	December 2028	4.750%	4.800%	$	400,000	$	400,000
Unamortized discount and deferred financing costs					(3,952)		(4,446)
Net carrying amount					$	396,048	$	395,554
4.350% Unsecured Senior Notes (6)	October 2018	October 2026	4.350%	4.350%	$	200,000	$	200,000
Unamortized discount and deferred financing costs					(1,012)		(1,186)
Net carrying amount					$	198,988	$	198,814
4.300% Unsecured Senior Notes (6)	July 2018	July 2026	4.300%	4.300%	$	50,000	$	50,000
Unamortized discount and deferred financing costs					(246)		(290)
Net carrying amount					$	49,754	$	49,710
3.450% Unsecured Senior Notes (7)	December 2017	December 2024	3.450%	3.470%	$	425,000	$	425,000
Unamortized discount and deferred financing costs					(2,321)		(2,907)
Net carrying amount					$	422,679	$	422,093
3.450% Unsecured Senior Notes (8)	February 2017	February 2029	3.450%	3.450%	$	75,000	$	75,000
Unamortized discount and deferred financing costs					(347)		(390)
Net carrying amount					$	74,653	$	74,610
3.350% Unsecured Senior Notes (8)	February 2017	February 2027	3.350%	3.350%	$	175,000	$	175,000
Unamortized discount and deferred financing costs					(709)		(825)
Net carrying amount					$	174,291	$	174,175
4.375% Unsecured Senior Notes (9)	September 2015	October 2025	4.375%	4.444%	$	400,000	$	400,000
Unamortized discount and deferred financing costs					(2,631)		(3,185)
Net carrying amount					$	397,369	$	396,815
4.250% Unsecured Senior Notes (10)	July 2014	August 2029	4.250%	4.350%	$	400,000	$	400,000
Unamortized discount and deferred financing costs					(4,567)		(5,100)
Net carrying amount					$	395,433	$	394,900
3.800% Unsecured Senior Notes (11)	January 2013	January 2023	3.800%	3.800%	$	300,000	$	300,000
Unamortized discount and deferred financing costs					(560)		(834)
Net carrying amount					$	299,440	$	299,166
Total Unsecured Senior Notes, Net					$	3,670,099	$	2,899,839

____________________

(1)Represents the effective interest rate including the amortization of initial issuance discounts, excluding the amortization of deferred financing costs.

(2)Interest on these notes is payable semi-annually in arrears on May 15 and November 15 of each year.

(3)Interest on these notes is payable semi-annually in arrears on April 18 and October 18 of each year.

(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 June 15th and December 15th of each year.

(6)Interest on these notes is payable semi-annually in arrears on April 18th and October 18th of each year.

(7)Interest on these notes is payable semi-annually in arrears on June 15th and December 15th of each year.

(8)Interest on these notes is payable semi-annually in arrears on February 17th and August 17th of each year.

(9)Interest on these notes is payable semi-annually in arrears on April 1st and October 1st of each year.

(10)Interest on these notes is payable semi-annually in arrears on February 15th and August 15th of each year.

(11)Interest on these notes is payable semi-annually in arrears on January 15th and July 15th of each year.

Unsecured Revolving Credit Facility and Term Loan Facility

The following table summarizes the balance and terms of our unsecured revolving credit facility as of December 31, 2020 and 2019:

	December 31, 2020			December 31, 2019
	(in thousands)
Outstanding borrowings	$	—		$	245,000
Remaining borrowing capacity	750,000			505,000
Total borrowing capacity (1)	$	750,000		$	750,000
Interest rate (2)	1.14		%	2.76		%
Facility fee-annual rate (3)	0.200%
Maturity date	July 2022

____________________

(1)We may elect to borrow, subject to bank approval and obtaining commitments for any additional borrowing capacity, up to an additional $600.0 million under an accordion feature under the terms of the unsecured revolving credit facility and unsecured term loan facility.

(2)Our unsecured revolving credit facility interest rate was calculated based on the contractual rate of LIBOR plus 1.000% as of December 31, 2020 and 2019.

(3)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 December 31, 2020 and 2019, $2.1 million and $3.4 million of unamortized deferred financing costs, respectively, which are included in prepaid expenses and other assets, net on our consolidated balance sheets, remained to be amortized through the maturity date of our unsecured revolving credit facility.

The Company intends to borrow under the unsecured revolving credit facility from time to time for general corporate purposes, to finance development and redevelopment expenditures, to fund potential acquisitions and to potentially repay long-term debt and to supplement cash balances given uncertainties and volatility in market conditions.

In August 2020, the Company repaid in full the $150.0 million unsecured term loan facility. The following table summarizes the balance and terms of our unsecured term loan facility as of December 31, 2019, which is included in unsecured debt, net on our consolidated balance sheets:

	December 31, 2019
Outstanding borrowings	$	150,000
Remaining borrowing capacity	—
Total borrowing capacity (1)	$	150,000
Interest rate (2)	2.85		%
Undrawn facility fee-annual rate	0.200%
Maturity date	July 2022

____________________

(1)As of December 31, 2019, $0.7 million of unamortized deferred financing costs 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 the contractual rate of LIBOR plus 1.100% as of December 31, 2019.

Debt Covenants and Restrictions

The unsecured revolving credit facility, the unsecured senior notes, the Series A and B Notes due 2026, Series A and B Notes due 2027 and 2029, and Notes due 2031 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 December 31, 2020 and 2019.

Debt Maturities

The following table summarizes the stated debt maturities and scheduled amortization payments as of December 31, 2020:

Year	(in thousands)
2021	$	5,342
2022	5,554
2023	305,775
2024	431,006
2025	406,246
Thereafter	2,800,442
Total aggregate principal value (1)	$	3,954,365

________________________ 

(1)     Includes gross principal balance of outstanding debt before the effect of the following at December 31, 2020: $22.4 million of unamortized deferred financing costs for the unsecured senior notes and secured debt and $8.3 million of unamortized discounts for the unsecured senior notes.

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 years ended December 31, 2020, 2019 and 2018. The interest expense capitalized was recorded as a cost of development and increased the carrying value of undeveloped land and construction in progress.

	Year Ended December 31,
	2020		2019		2018
	(in thousands)
Gross interest expense	$	150,325	$	129,778	$	117,789
Capitalized interest and deferred financing costs	(79,553)		(81,241)		(68,068)
Interest expense	$	70,772	$	48,537	$	49,721

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Deferred Revenue and Acquisition-Related Intangible Liabilities, net

12 Months Ended

Dec. 31, 2020

Revenue from Contract with Customer [Abstract]

Deferred Revenue and Acquisition-Related Intangible Liabilities, net

Deferred Revenue and Acquisition-Related Intangible Liabilities, net

Deferred revenue and acquisition-related intangible liabilities, net consisted of the following at December 31, 2020 and 2019:

	December 31,
	2020		2019
	(in thousands)
Deferred revenue related to tenant-funded tenant improvements	$	88,645	$	96,271
Other deferred revenue	26,533		19,125
Acquisition-related intangible liabilities, net (1)	13,345		24,092
Total	$	128,523	$139,488

_____________________

(1)See Note 5 “Deferred Leasing Costs and Acquisition-Related Intangible Assets and Liabilities, net” for additional information regarding our acquisition-related intangible liabilities.

Deferred Revenue Related to Tenant-funded Tenant Improvements

During the years ended December 31, 2020, 2019, and 2018, $22.5 million, $19.2 million and $18.4 million, respectively, of deferred revenue related to tenant-funded tenant improvements was amortized and recognized as rental income. The following is the estimated amortization of deferred revenue related to tenant-funded tenant improvements as of December 31, 2020 for the next five years and thereafter:

Year Ending	(in thousands)
2021	$	16,216
2022	15,188
2023	13,367
2024	11,325
2025	8,564
Thereafter	23,985
Total	$	88,645

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Noncontrolling Interests on the Company’s Consolidated Financial Statements

12 Months Ended

Dec. 31, 2020

Noncontrolling Interest [Abstract]

Noncontrolling Interests on the Company’s Consolidated Financial Statements

Noncontrolling Interests on the Company’s Consolidated Financial Statements

Common Units of the Operating Partnership

The Company owned a 99.0% and 98.1% common general partnership interest in the Operating Partnership as of December 31, 2020 and 2019, respectively. The remaining 1.0% and 1.9% common limited partnership interest as of December 31, 2020 and 2019, respectively, was owned by non-affiliated investors and certain of our executive officers and directors in the form of noncontrolling common units. There were 1,150,574 and 2,023,287 common units outstanding held by these investors, executive officers and directors as of December 31, 2020 and 2019, respectively. The decrease in the common units from December 31, 2019 to December 31, 2020 was attributable to 872,713 common unit redemptions.

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 $65.4 million and $167.7 million as of December 31, 2020 and 2019, respectively. This redemption value does not necessarily represent the amount that would be distributed with respect to each noncontrolling common unit in the event of our termination or liquidation. In the event of our termination or liquidation, it is expected in most cases that each common unit would be entitled to a liquidating distribution equal to the liquidating distribution payable in respect of each share of the Company’s common stock.

Noncontrolling Interest in Consolidated Property Partnerships

In August 2016, the Operating Partnership entered into agreements with Norges Bank Real Estate Management (“NBREM”) whereby NBREM made contributions, through two REIT subsidiaries, for a 44% common equity interest in two existing companies that owned the Company’s 100 First Street and 303 Second Street office properties located in San Francisco, California. The transactions did not meet the criteria to qualify as sales of real estate because the Company continues to effectively control the properties and therefore continued to account for the 100 First Street and 303 Second Street office properties on a consolidated basis in its financial statements. At formation, the Company accounted for the transactions as equity transactions and recognized noncontrolling interests in its consolidated balance sheets.

The noncontrolling interests in 100 First LLC and 303 Second LLC as of December 31, 2020 and 2019 were $191.9 million and $189.6 million, respectively. The remaining amount of noncontrolling interests in consolidated property partnerships represents the third party equity interest in Redwood LLC. This noncontrolling interest was $5.6 million and $5.8 million as of December 31, 2020 and 2019, respectively.

Noncontrolling Interests on the Operating Partnership’s Consolidated Financial Statements

Consolidated Property Partnerships

In August 2016, the Operating Partnership entered into agreements with NBREM whereby NBREM made contributions, through two REIT subsidiaries, for a 44% common equity interest in two existing companies that owned the Company’s 100 First Street and 303 Second Street office properties located in San Francisco, California. Refer to Note 11 for additional information regarding these consolidated property partnerships.

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Noncontrolling Interests on the Operating Partnership’s Consolidated Financial Statements

12 Months Ended

Dec. 31, 2020

Noncontrolling Interest [Abstract]

Noncontrolling Interests on the Operating Partnership’s Consolidated Financial Statements

Noncontrolling Interests on the Company’s Consolidated Financial Statements

Common Units of the Operating Partnership

The Company owned a 99.0% and 98.1% common general partnership interest in the Operating Partnership as of December 31, 2020 and 2019, respectively. The remaining 1.0% and 1.9% common limited partnership interest as of December 31, 2020 and 2019, respectively, was owned by non-affiliated investors and certain of our executive officers and directors in the form of noncontrolling common units. There were 1,150,574 and 2,023,287 common units outstanding held by these investors, executive officers and directors as of December 31, 2020 and 2019, respectively. The decrease in the common units from December 31, 2019 to December 31, 2020 was attributable to 872,713 common unit redemptions.

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 $65.4 million and $167.7 million as of December 31, 2020 and 2019, respectively. This redemption value does not necessarily represent the amount that would be distributed with respect to each noncontrolling common unit in the event of our termination or liquidation. In the event of our termination or liquidation, it is expected in most cases that each common unit would be entitled to a liquidating distribution equal to the liquidating distribution payable in respect of each share of the Company’s common stock.

Noncontrolling Interest in Consolidated Property Partnerships

In August 2016, the Operating Partnership entered into agreements with Norges Bank Real Estate Management (“NBREM”) whereby NBREM made contributions, through two REIT subsidiaries, for a 44% common equity interest in two existing companies that owned the Company’s 100 First Street and 303 Second Street office properties located in San Francisco, California. The transactions did not meet the criteria to qualify as sales of real estate because the Company continues to effectively control the properties and therefore continued to account for the 100 First Street and 303 Second Street office properties on a consolidated basis in its financial statements. At formation, the Company accounted for the transactions as equity transactions and recognized noncontrolling interests in its consolidated balance sheets.

The noncontrolling interests in 100 First LLC and 303 Second LLC as of December 31, 2020 and 2019 were $191.9 million and $189.6 million, respectively. The remaining amount of noncontrolling interests in consolidated property partnerships represents the third party equity interest in Redwood LLC. This noncontrolling interest was $5.6 million and $5.8 million as of December 31, 2020 and 2019, respectively.

Noncontrolling Interests on the Operating Partnership’s Consolidated Financial Statements

Consolidated Property Partnerships

In August 2016, the Operating Partnership entered into agreements with NBREM whereby NBREM made contributions, through two REIT subsidiaries, for a 44% common equity interest in two existing companies that owned the Company’s 100 First Street and 303 Second Street office properties located in San Francisco, California. Refer to Note 11 for additional information regarding these consolidated property partnerships.

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Stockholders' Equity of the Company

12 Months Ended

Dec. 31, 2020

Equity [Abstract]

Stockholders' Equity of the Company

Stockholders’ Equity of the Company

Common Stock

Increase in Authorized Shares

On May 19, 2020, the Company’s stockholders approved a proposal to amend and restate the Company’s charter to increase the number of authorized shares of common stock that the Company has the authority to issue from 150,000,000 shares to 280,000,000 shares.

Forward Equity Offerings and Settlements

On February 18, 2020, the Company entered into forward equity sale agreements with certain financial institutions acting as forward purchasers in connection with an offering of 5,750,000 shares of common stock at an initial gross offering price of $494.5 million, or $86.00 per share, before underwriting discounts, commissions and offering expenses. The forward purchasers borrowed and sold an aggregate of 5,750,000 shares of common stock in the offering. The Company did not receive any proceeds from the sale of its shares of common stock by the forward purchasers at the time of the offering.

On March 25, 2020, the Company physically settled these forward equity sale agreements. Upon settlement, the Company issued 5,750,000 shares of common stock for net proceeds of $474.9 million and contributed the net proceeds to the Operating Partnership in exchange for an equal number of units in the Operating Partnership.

In August 2018, the Company entered into forward equity sale agreements with certain financial institutions acting as forward purchasers in connection with an offering of 5,000,000 shares of common stock at an initial gross offering price of $360.5 million, or $72.10 per share, before underwriting discounts, commissions and offering expenses. The forward purchasers borrowed and sold an aggregate of 5,000,000 shares of common stock in the offering. The Company did not receive any proceeds from the sale of its shares of common stock by the forward purchasers at the time of the offering.

In July 2019, the Company physically settled these forward equity sale agreements. Upon settlement, the Company issued 5,000,000 shares of common stock for net proceeds of $354.3 million and contributed the net proceeds to the Operating Partnership in exchange for an equal number of units in the Operating Partnership.

At-The-Market Stock Offering Programs

Under our at-the-market stock offering programs, which commenced in December 2014 and June 2018, we may offer and sell shares of our common stock from time to time in “at-the-market” offerings. During the year ended December 31, 2018, the Company completed its existing at-the-market stock offering program (the “2014 At-The-Market Program”) under which we sold an aggregate of $300.0 million in gross sales of shares. In June 2018, the Company commenced a new at-the-market stock offering program (the “2018 At-The-Market Program”) under which we may offer and sell shares of our common stock with an aggregate gross sales price of up to $500.0 million. In connection with the 2018 At-The-Market Program, the Company may also, at its discretion, enter into forward equity sale agreements. The use of forward equity sale agreements allows the Company to lock in a share price on the sale of shares of our common stock at the time an agreement is executed, but defer settling the forward equity sale agreements and receiving the proceeds from the sale of shares until a later date.

During the year ended December 31, 2019, we executed various 12-month forward equity sale agreements under the 2018 Program with financial institutions acting as forward purchasers to sell 3,147,110 shares of common stock at a weighted average sales price of $80.08 per share before underwriting discounts, commissions and offering expenses. The Company did not receive any proceeds from the sale of its shares of common stock by forward purchasers at the time of sale.

In March 2020, the Company physically settled all forward equity sale agreements entered into in 2019. Upon settlement, the Company issued 3,147,110 shares of common stock for net proceeds of $247.3 million and contributed the net proceeds to the Operating Partnership in exchange for an equal number of units in the Operating Partnership. We did not enter into any forward equity sale agreements under our at-the-market program during the year ended December 31, 2020.

The following table sets forth information regarding settlements of forward equity sale agreements under our at-the-market offering program for the year ended December 31, 2020:

	Year Ended December 31, 2020
	(in millions, except share and per share data)
Shares of common stock settled during the period	3,147,110
Weighted average price per share of common stock	$	80.08
Aggregate gross proceeds	$	252.0
Aggregate net proceeds after selling commissions	$	247.3

Since commencement of the 2018 At-The-Market program through December 31, 2020, we have sold 3,594,576 shares of common stock under the 2018 At-The-Market Program. As of December 31, 2020, we may offer and sell shares of our common stock having an aggregate gross sales price up to approximately $214.2 million under the 2018 At-The-Market Program.

The Company did not complete any direct sales of common stock under the program during the years ended December 31, 2020 and 2019. During the year ended December 31, 2018, we sold 447,466 shares of common stock under the 2018 At-The-Market Program and 1,369,729 shares of common stock under the 2014 At-The-Market Program. The following table sets forth information regarding direct sales of our common stock under our at-the-market offering programs for the year ended December 31, 2018:

	Year Ended December 31, 2018
	(in millions, except share and per share data)
Shares of common stock sold during the period		1,817,195
Weighted average price per share of common stock		$	73.64
Aggregate gross proceeds		$	133.8
Aggregate net proceeds after selling commissions		$	132.1

The proceeds from sales were used to fund development expenditures and general corporate purpose. 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 the 2018 At-The-Market Program.

Common Stock Repurchases

As of December 31, 2020, 4,935,826 shares remained eligible for repurchase under a share repurchase program approved by the Company’s board of directors in 2016. The Company did not repurchase shares of common stock under this program during the three years ended December 31, 2020, 2019 and 2018.

Accrued Dividends and Distributions

The following tables summarize accrued dividends and distributions for the noted outstanding shares of common stock and noncontrolling units as of December 31, 2020 and 2019:

	December 31,
	2020		2019
	(in thousands)
Dividends and Distributions payable to:
Common stockholders	$	58,018	$	51,418
Noncontrolling common unitholders of the Operating Partnership	575		981
RSU holders (1)	838		820
Total accrued dividends and distribution to common stockholders and noncontrolling unitholders	$	59,431	$	53,219

_____________________

(1)The amount includes the value of the dividend equivalents that will be paid with additional RSUs (see Note 15 “Share-Based and Other Compensation” for additional information).

	December 31,
	2020	2019
Outstanding Shares and Units:
Common stock (1)	116,035,827	106,016,287
Noncontrolling common units	1,150,574	2,023,287
RSUs (2)	1,638,026	1,651,905

_____________________

(1)The amount includes nonvested shares.

(2)The amount includes nonvested RSUs. Does not include 873,709 and 932,675 market measure-based RSUs because not all the necessary performance conditions have been met as of December 31, 2020 and 2019, respectively. Refer to Note 15 “Share-Based and Other Compensation” for additional information.

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Partners' Capital of the Operating Partnership

12 Months Ended

Dec. 31, 2020

Partners' Capital [Abstract]

Partners' Capital of the Operating Partnership

Partners’ Capital of the Operating Partnership

Common Units

Issuance of Common Units

In March 2020, the Company physically settled the forward equity sale agreements entered into in February 2020 (see Note 13 “Stockholders’ Equity of the Company”). Upon settlement, the Company issued 5,750,000 shares of common stock for net proceeds of $474.9 million and contributed the net proceeds to the Operating Partnership in exchange for 5,750,000 common units.

In July 2019, the Company physically settled the forward equity sale agreements entered into in August 2018 (see Note 13 “Stockholders’ Equity of the Company”). Upon settlement, the Company issued 5,000,000 shares of common stock for net proceeds of $354.3 million and contributed the net proceeds to the Operating Partnership in exchange for 5,000,000 common units.

At-The-Market Stock Offering Program

In March 2020, the Company physically settled all forward equity sale agreements entered into in 2019. Upon settlement, the Company issued 3,147,110 shares of common stock for net proceeds of $247.3 million and contributed the net proceeds to the Operating Partnership in exchange for an equal number of units in the Operating Partnership. The Company did not issue any shares of common stock under its at-the-market programs and did not contribute any shares of common stock to the Operating Partnership during the year ended December 31, 2019. During the year ended December 31, 2018, the Company utilized its at-the-market stock offering programs to issue shares of common stock. See Note 13 “Stockholders’ Equity of the Company” for additional information. The net

offering proceeds contributed by the Company to the Operating Partnership in exchange for common units for the year ended December 31, 2020 and 2018 are as follows:

	Year Ended December 31,
	2020		2018
	(in millions except share and per share data)
Shares of common stock contributed by the Company	3,147,110		1,817,195
Common units exchanged for shares of common stock by the Company	3,147,110		1,817,195
Aggregate gross proceeds	$	252.0	$	133.8
Aggregate net proceeds after selling commissions	$	247.3	$	132.1

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:

	December 31, 2020		December 31, 2019
Company owned common units in the Operating Partnership	116,035,827		106,016,287
Company owned general partnership interest	99.0	%	98.1	%
Noncontrolling common units of the Operating Partnership	1,150,574		2,023,287
Ownership interest of noncontrolling interest	1.0	%	1.9	%

For a further discussion of the noncontrolling common units during the years ended December 31, 2020 and 2019, refer to Note 11 “Noncontrolling Interests on the Company’s Consolidated Financial Statements.”

Accrued Distributions

The following tables summarize accrued distributions for the noted common units as of December 31, 2020 and 2019:

	December 31, 2020		December 31, 2019
	(in thousands)
Distributions payable to:
General partner	$	58,018	$	51,418
Common limited partners	575		981
RSU holders (1)	838		820
Total accrued distributions to common unitholders	$	59,431	$	53,219

_____________________

(1)The amount includes the value of the dividend equivalents that will be paid with additional RSUs (see Note 15 “Share-Based and Other Compensation” for additional information).

	December 31, 2020	December 31, 2019
Outstanding Units:
Common units held by the general partner	116,035,827	106,016,287
Common units held by the limited partners	1,150,574	2,023,287
RSUs (1)	1,638,026	1,651,905

_____________________

(1)Does not include 873,709 and 932,675 market measure-based RSUs because not all the necessary performance conditions have been met as of December 31, 2020 and 2019, respectively. Refer to Note 15 “Share-Based and Other Compensation” for additional information.

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Share-Based and Other Compensation

12 Months Ended

Dec. 31, 2020

Share-based Payment Arrangement [Abstract]

Share-Based and Other Compensation

Share-Based and Other Compensation

Stockholder Approved Share-Based Incentive Compensation Plan

As of December 31, 2020, we maintained one share-based incentive compensation plan, the Kilroy Realty 2006 Incentive Award Plan, as amended (the “2006 Plan”). The Company has a currently effective registration statement registering 10.7 million shares of our common stock for possible issuance under our 2006 Incentive Award Plan. As of December 31, 2020, approximately 1.5 million 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) for which the performance period has been completed and (ii) at maximum levels for the other performance and market conditions (as defined below) for awards still in a performance period.

The Executive Compensation Committee (the “Compensation Committee”) of the Company’s Board of Directors may grant the following share-based awards to eligible individuals, as provided under the 2006 Plan: incentive stock options, nonqualified stock options, restricted stock (nonvested shares), stock appreciation rights, performance shares, performance stock units, dividend equivalents, stock payments, deferred stock, restricted stock units (“RSUs”), profit interest units, performance bonus awards, performance-based awards and other incentive awards. For each award granted under our share-based incentive compensation programs, the Operating Partnership simultaneously issues to the Company a number of common units equal to the number of shares of common stock ultimately paid by the Company in respect of such awards.

2020, 2019 and 2018 Share-Based Compensation Grants

In January 2020, the Executive Compensation Committee of the Company’s Board of Directors awarded 263,626 restricted stock units (“RSUs”) to certain officers of the Company under the 2006 Plan, which included 154,267 RSUs (at the target level of performance) that are subject to market and/or performance-based vesting requirements (the “2020 Performance-Based RSUs”) and 109,359 RSUs that are subject to time-based vesting requirements (the “2020 Time-Based RSUs”). During the year ended December 31, 2020, 5,148 2020 Time-Based RSUs, 12,263 2020 Performance-Based RSUs and 6,441 time-based and performance-based RSUs that were granted in prior years were forfeited.

In February 2019, the Executive Compensation Committee of the Company’s Board of Directors awarded 288,378 RSUs to certain officers of the Company under the 2006 Plan, which included 143,396 RSUs (at the target level of performance) that are subject to market and/or performance-based vesting requirements (the “2019 Performance-Based RSUs”) and 144,982 RSUs that are subject to time-based vesting requirements (the “2019 Time-Based RSUs”). During the year ended December 31, 2019, 10,733 2019 Time-Based RSUs, 24,353 2019 Performance-Based RSUs and 98,844 time vest and performance RSUs that were granted in prior years were forfeited.

In connection with entering into an amended employment agreement (the “Amended Employment Agreement”), on December 27, 2018, the Compensation Committee of the Company’s Board of Directors awarded John Kilroy, the Chairman of the Board of Directors and Chief Executive Officer of the Company and the Operating Partnership, 483,871 RSUs, providing an additional retention incentive during the term of the agreement and enticing Mr. Kilroy to delay his retirement. Of these RSUs awarded, 266,130 RSUs (at the target level of performance) are subject to market-based vesting requirements and 217,741 RSUs are subject to time-based vesting requirements. In addition to Mr. Kilroy’s award, the Compensation Committee of the Company’s Board of Directors awarded 161,290 RSUs to certain members of management. Of these RSUs awarded, 80,647 RSUs (at the target level of performance) are subject to market-based vesting requirements (together totaling 346,777 target RSUs with Mr. Kilroy’s award, the “December 2018 Market-Based RSUs”) and 80,643 RSUs are subject to time-based vesting requirements (together totaling 298,384 RSUs with Mr. Kilroy’s award, the “December 2018 Time-Based RSUs”).

In January and February 2018, the Executive Compensation Committee of the Company’s Board of Directors awarded 282,038 RSUs to certain officers of the Company under the 2006 Plan, which included 158,205 RSUs (at the target level of performance) that are subject to market and/or performance-based vesting requirements (the “2018 Performance-Based RSUs”) and 123,833 RSUs that are subject to time-based vesting requirements (the “2018 Time-Based RSUs”). Additionally, during 2018, 14,999 RSUs were granted to the board of directors and certain members of management subject to time vesting requirements.

    December 2018 Market-Based RSU Grant

Between 0% and 200% of the total 346,777 target number of December 2018 Market-Based RSUs will be eligible to vest based on the Company’s relative total shareholder return (“TSR”) versus a comparative group of companies that consist of companies in the SNL US REIT Office Index over the performance period. An initial number of RSUs (the “Initial Number of RSUs”) will be determined at the end of 2021 based on a three year performance period (consisting of calendar years 2019 through 2021). Once the Initial Number of RSUs is determined, 75% of the Initial Number of RSUs will be scheduled to vest on January 5, 2022. The remaining 25% of the Initial Number of RSUs will be scheduled to vest on January 5, 2023, subject to adjustment based on the Company’s relative TSR for the entire four-year performance period (2019 through 2022). The December 2018 Market-Based RSUs are also subject to service vesting requirements through the scheduled vest dates.

Each December 2018 Market-Based RSU represents the right to receive one share of our common stock in the future, subject to, and as modified by, the Company’s level of achievement of the applicable market conditions. The December 27, 2018 grant date fair value of the December 2018 Market-Based RSUs was $23.8 million. The fair value was calculated using a Monte Carlo simulation pricing model based on the assumptions in the table below. For the years ended December 31, 2020, 2019 and 2018, we recorded compensation expense based upon the $68.66 grant date fair value per share. Compensation expense for the December 2018 Market-Based RSUs is recognized using a graded vesting approach, where 75% of the fair value will be recognized on a straight-line basis over the three-year initial performance period through the end of 2021, and the remaining 25% of the fair value will be recognized on a straight-line basis over the four-year final performance period through the end of 2022. The following table summarizes the assumptions utilized in the Monte Carlo simulation pricing models:

	December 2018 Market-Based RSU Award Fair Value Assumptions
Valuation date	December 27, 2018
Fair value per share on valuation date	$68.66
Expected share price volatility	23.0%
Risk-free interest rate	2.4%

The computation of expected volatility was based on a blend of the historical volatility of our shares of common stock over a period of twice the performance period and implied volatility data based on the observed pricing of six month publicly-traded options on shares of our common stock. The risk-free interest rate was based on the yield curve on zero-coupon U.S. Treasury STRIP securities in effect at December 27, 2018.

    2020, 2019 and 2018 Annual Performance-Based RSU Grants

The 2020 Performance-Based RSUs are scheduled to vest at the end of a three year period (consisting of calendar years 2020-2022). A target number of 2020 Performance-Based RSUs were awarded, and the final number of 2020 Performance-Based RSUs that vest (which may be more or less than the target number) will be based upon (1) the achievement of pre-set FFO per share goals for the year ending December 31, 2020 that applies to 100% of the Performance-Based RSUs awarded (the “2020 FFO Performance Condition”) and (2) a performance measure that applies to 50% of the award based upon a measure of the Company’s average debt to EBITDA ratio for the three year performance period (the “2020 Debt to EBITDA Ratio Performance Condition”) and a market measure that applies to the other 50% of the award based upon the relative ranking of the Company’s total stockholder return for the three year performance period compared to the total stockholder returns of an established comparison group of companies over the same period (the “2020 Market Condition”). The 2020 Performance-Based RSUs are also subject to a three year service vesting provision (the “service vesting condition”) and are scheduled to cliff vest on the date the final vesting percentage is determined following the end of the three year performance period under the

awards. The 2020 FFO Performance Condition was achieved at 100% of target for all participants. The number of 2020 Performance-Based RSUs ultimately earned could fluctuate from the target number of 2020 Performance-Based RSUs granted based upon the levels of achievement for the 2020 Debt to EBITDA Ratio Performance Condition, the 2020 Market Condition, and the extent to which the service vesting condition is satisfied. The estimate of the number of 2020 Performance-Based RSUs earned is evaluated quarterly during the performance period based on our estimate for each of the performance conditions measured against the applicable goals. Compensation expense for the 2020 Performance-Based RSU grant is recognized on a straight-line basis over the requisite service period for each participant, which is generally the three year service period.

The 2019 Performance-Based RSUs are scheduled to vest at the end of a three year period (consisting of calendar years 2019-2021). A target number of 2019 Performance-Based RSUs were awarded, and the final number of 2019 Performance-Based RSUs that vest (which may be more or less than the target number) will be based upon (1) the achievement of pre-set FFO per share goals for the year ending December 31, 2019 that applies to 100% of the Performance-Based RSUs awarded (the “2019 FFO Performance Condition”) and (2) a performance measure that applies to 50% of the award based upon a measure of the Company’s average debt to EBITDA ratio for the three year performance period (the “2019 Debt to EBITDA Ratio Performance Condition”) and a market measure that applies to the other 50% of the award based upon the relative ranking of the Company’s total stockholder return for the three year performance period compared to the total stockholder returns of an established comparison group of companies over the same period (the “2019 Market Condition”). The 2019 Performance-Based RSUs are also subject to a three year service vesting provision (the “service vesting condition”) and are scheduled to cliff vest on the date the final vesting percentage is determined following the end of the three year performance period under the awards. The 2019 FFO Performance Condition was achieved at 175% of target for one participant and 150% of target for all other participants. The number of 2019 Performance-Based RSUs ultimately earned could fluctuate from the target number of 2019 Performance-Based RSUs granted based upon the levels of achievement for the 2019 Debt to EBITDA Ratio Performance Condition, the 2019 Market Condition, and the extent to which the service vesting condition is satisfied. The estimate of the number of 2019 Performance-Based RSUs earned is evaluated quarterly during the performance period based on our estimate for each of the performance conditions measured against the applicable goals. Compensation expense for the 2019 Performance-Based RSU grant is recognized on a straight-line basis over the requisite service period for each participant, which is generally the three year service period.

The 2018 Performance-Based RSUs are scheduled to vest at the end of a three year period (consisting of calendar years 2018-2020). A target number of 2018 Performance-Based RSUs were awarded, and the final number of 2018 Performance-Based RSUs that vest (which may be more or less than the target number) will be based upon (1) the achievement of pre-set FFO per share goals for the year ending December 31, 2018 that applies to 100% of the Performance-Based RSUs awarded (the “2018 FFO Performance Condition”) and (2) a performance measure that applies to 50% of the award based upon a measure of the Company’s average debt to EBITDA ratio for the three year performance period (the “2018 Debt to EBITDA Ratio Performance Condition” and together with the 2018 FFO Performance Condition, the “2018 Performance Conditions”) and a market measure that applies to the other 50% of the award based upon the relative ranking of the Company’s TSR for the three year performance period compared to the TSR of an established comparison group of companies over the same period (the “2018 Market Condition”). Based on the combined results of the 2018 Performance Conditions and the 2018 Market Condition, the 2018 Performance-Based RSUs achieved a weighted average of 219% for one participant and 175% for the others of their target level of performance.

As of December 31, 2020, the estimated number of RSUs earned for the 2020 and 2019 Performance-Based RSUs and the actual number of RSUs earned for the 2018 Performance-Based RSUs was as follows:

	2020 Performance-Based RSUs	2019 Performance-Based RSUs	2018 Performance-Based RSUs
Service vesting period	January 31, 2020 - January, 2023	February 1, 2019 - January, 2022	February 14, 2018 - January, 2021
Target RSUs granted	154,267	143,396	158,205
Estimated RSUs earned (1)	142,004	220,151	229,748
Date of valuation	January 31, 2020	February 1, 2019	February 14, 2018

_____________________

(1)Estimated RSUs earned for the 2020 Performance-Based RSUs are based on the actual achievement of the 2020 FFO Performance Condition and for the 2020 Debt to EBITDA Ratio Performance Condition, assumes 100% of the target level of achievement for all participants, and target level of achievement of the 2020 Market Condition. Estimated RSUs earned for the 2019 Performance-Based RSUs are based on the actual achievement of the 2019 FFO Performance Condition and assume target level achievement of the 2019 Market Condition and maximum level of achievement of the 2019 Debt to EBITDA Ratio Performance Condition. The 2018 Performance-Based RSUs earned are based on actual performance of the 2018 Performance Conditions and the 2018 Market Condition.

Each Performance-Based RSU represents the right to receive one share of our common stock in the future, subject to, and as modified by, the Company’s level of achievement of the applicable performance and market conditions. The fair values of the 2020 Performance-Based RSUs, 2019 Performance-Based RSUs and 2018 Performance-Based RSUs were $12.9 million at January 31, 2020, $10.2 million at February 1, 2019, and $10.8 million at February 14, 2018, respectively. The fair values for the awards with market conditions were calculated using a Monte Carlo simulation pricing model based on the assumptions in the table below. The determination of the fair value of the 2020, 2019 and 2018 Performance-Based RSUs takes into consideration the likelihood of achievement of the 2020, 2019 and 2018 Performance Conditions and the 2020, 2019 and 2018 Market Conditions, respectively, as discussed above. The following table summarizes the assumptions utilized in the Monte Carlo simulation pricing models:

	2020 Award Fair Value Assumptions	2019 Award Fair Value Assumptions	2018 Award Fair Value Assumptions
Valuation date	January 31, 2020	February 1, 2019	February 14, 2018
Fair value per share on valuation date	$84.54	$72.57	$70.08
Expected share price volatility	17.0%	19.0%	20.0%
Risk-free interest rate	1.35%	2.48%	2.37%

The computation of expected volatility was based on a blend of the historical volatility of our shares of common stock over a period of twice the remaining performance period as of the grant date and implied volatility data based on the observed pricing of six month publicly-traded options on shares of our common stock. The risk-free interest rate was based on the yield curve on zero-coupon U.S. Treasury STRIP securities in effect at January 31, 2020, February 1, 2019, and February 14, 2018.

Compensation expense for the Performance-Based RSUs is recognized on a straight-line basis over the requisite service period for each participant, which is generally the three-year service period. As of December 31, 2020, the number of 2020 Performance-Based RSUs estimated to be earned based on the Company’s estimate of the performance conditions measured against the applicable goals was 142,004, and the compensation cost recorded to date for this program was based on that estimate. For the portion of the 2020 Performance-Based RSUs subject to the 2020 Market Condition, for the year ended December 31, 2020, we recorded compensation expense based upon the $84.54 fair value per share at January 31, 2020. Compensation expense will be variable for the portion of the 2020 Performance-Based RSUs subject to the 2020 Debt to EBITDA Ratio Performance Condition, based upon the outcome of that condition. As of December 31, 2020, the number of 2019 Performance-Based RSUs estimated to be earned based on the Company’s estimate of the performance conditions measured against the applicable goals was 220,151, and the compensation cost recorded to date for this program was based on that estimate. For the portion of the 2019 Performance-Based RSUs subject to the 2019 Market Condition, for the years ended December 31, 2020 and 2019, we recorded compensation expense based upon the $72.57 fair value per share at February 1, 2019. Compensation expense will be variable for the portion of the 2019 Performance-Based RSUs subject to the 2019 Debt to EBITDA Performance Condition, based upon the outcome of that condition. For the years ended December 31, 2020, 2019 and 2018, we recorded compensation expense for the portion of the 2018 Performance-Based RSUs subject to the 2018 Market Condition based upon the $70.08 fair value per share at February 14, 2018 and for the portion of the 2018 Performance-Based RSUs subject to the 2018 Debt to EBITDA Ratio Performance Condition, based on the stock price at date of grant multiplied by the number of RSUs estimated to be earned at December 31 of each year. As of December 31, 2020, net of forfeitures, 229,748 RSUs were estimated to be earned.

Annual 2020, 2019 and 2018 and December 2018 Time-Based RSU Grants

The annual 2020, 2019 and 2018 Time-Based RSUs are scheduled to vest in equal installments over the periods listed below. The 2020 Time-Based RSUs are scheduled to vest in three equal annual installments beginning on January 5, 2021 through January 5, 2023. The 2019 Time-Based RSUs are scheduled to vest in three equal annual installments beginning on January 5, 2020 through January 5, 2022. The December 2018 Time-Based RSUs are scheduled to vest 50% on January 5, 2022 and 50% on January 5, 2023. The 2018 Time-Based RSUs are scheduled to vest in three equal annual installments beginning on January 5, 2019 through January 5, 2021. Compensation expense for the December 2018 and annual 2020, 2019 and 2018 Time-Based RSUs is recognized on a straight-line basis over the requisite service period, which is generally the explicit service period. However, for one participant there is a shorter service period for their December 2018 Time-Based RSUs. Each Time-Based RSU represents the right to receive one share of our common stock in the future, subject to continued employment through the applicable vesting date, unless accelerated upon separation of employment. During the year ended December 31, 2020, the vesting of 54,735 Time-Based RSUs was accelerated due to separation of employment. The total fair value of the Time-Based RSUs is based on the Company's closing share price on the NYSE on the respective fair valuation dates as detailed in the table below:

	2020 Time-Based RSU Grant		2019 Time-Based RSU Grant		December 2018 Time-Based RSU Grant		2018 Time-Based RSU Grant (1)
Service vesting period	January 31, 2020 - January 5, 2023		February 1, 2019 - January 5, 2022		December 27, 2018 - January 5, 2023		January & February 2018 - January 5, 2021
Fair value on valuation date (in millions)	$	9.0	$	10.1	$	18.5	$	8.4
Fair value per share	$	82.57	$	69.89	$	62.00	$	70.37
Date of fair valuation	January 31, 2020		February 1, 2019		December 27, 2018		January & February 2018

____________________

(1)The 2018 Time-Based RSUs consist of 56,015 RSUs granted on January 29, 2018 at a fair value per share of $70.37 and 67,818 RSUs granted on February 14, 2018 at a fair value per share of $66.46.

Summary of Performance and Market-Measure Based RSUs

A summary of our performance and market-measure based RSU activity from January 1, 2020 through December 31, 2020 is presented below:

	Nonvested RSUs			Vested RSUs	Total RSUs
	Amount	Weighted-Average Fair Value Per Share
Outstanding at January 1, 2020	932,675	$	71.04	36,679	969,354
Granted	154,267	85.08		38,313	192,580
Vested	(230,334)	74.71		230,334	—
Settled (1)	—	—		(259,954)	(259,954)
Issuance of dividend equivalents (2)	29,561	62.21		1,407	30,968
Forfeited	(12,460)	84.54		(4)	(12,464)
Outstanding as of December 31, 2020 (3)	873,709	$	72.06	46,775	920,484

____________________

(1)Represents vested RSUs that were settled in shares of the Company’s common stock. Total shares settled include 125,928 shares that were tendered in accordance with the terms of the 2006 Plan to satisfy minimum statutory tax withholding requirements related to the RSUs settled. We accept the return of RSUs at the current quoted closing share price of the Company’s common stock to satisfy tax obligations.

(2)Represents the issuance of dividend equivalents earned on the underlying RSUs. The dividend equivalents vest based on terms specified under the related RSU award agreement.

(3)Outstanding RSUs as of December 31, 2020 represent the actual achievement of the FFO performance conditions and assumes target levels for the market and other performance conditions. The number of restricted stock units ultimately earned is subject to change based upon actual performance over the three-year vesting period. Dividend equivalents earned will vest along with the underlying award and are also subject to changes based on the number of RSUs ultimately earned for each underlying award.

A summary of our performance and market-measure based RSU activity for the years ended December 31, 2020, 2019 and 2018 is presented below:

	RSUs Granted			RSUs Vested
Years ended December 31,	Non-Vested RSUs Granted (1)	Weighted-Average Fair Value Per Share		Vested RSUs	Total Vest-Date Fair Value (in thousands)
2020	154,267	$	85.08	(270,054)	$	19,471
2019	231,191	71.12		(265,737)	18,703
2018	601,012	68.51		(265,918)	18,906

____________________

(1)Non-vested RSUs granted are based on the actual achievement of the FFO performance conditions and assumes target level achievement for the market and other performance conditions.

Summary of Time-Based RSUs

A summary of our time-based RSU activity from January 1, 2020 through December 31, 2020 is presented below:

	Nonvested RSUs			Vested RSUs	Total RSUs
	Amount	Weighted Average Fair Value Per Share
Outstanding at January 1, 2020	543,848	$	66.66	1,071,378	1,615,226
Granted	120,769	79.74		—	120,769
Vested	(173,796)	70.83		173,796	—
Settled (1)				(181,462)	(181,462)
Issuance of dividend equivalents (2)	15,523	61.80		34,812	50,335
Forfeited	(11,979)	77.58		—	(11,979)
Canceled (3)				(1,638)	(1,638)
Outstanding as of December 31, 2020	494,365	$	67.97	1,096,886	1,591,251

____________________

(1)Represents vested RSUs that were settled in shares of the Company’s common stock. Total shares settled include 67,316 shares that were tendered in accordance with the terms of the 2006 Plan to satisfy minimum statutory tax withholding requirements related to the RSUs settled. We accept the return of RSUs at the current quoted closing share price of the Company’s common stock to satisfy tax obligations.

(2)Represents the issuance of dividend equivalents earned on the underlying RSUs. The dividend equivalents vest based on terms specified under the related RSU award agreement.

(3)For shares vested but not yet settled, we accept the return of RSUs at the current quoted closing share price of the Company’s common stock to satisfy minimum statutory tax-withholding requirements related to either the settlement or vesting of RSUs in accordance with the terms of the 2006 Plan.

A summary of our time-based RSU activity for the years ended December 31, 2020, 2019 and 2018 is presented below:

	RSUs Granted			RSUs Vested
Year ended December 31,	Non-Vested RSUs Issued	Weighted-Average Grant Date Fair Value Per Share		Vested RSUs	Total Vest-Date Fair Value (1) (in thousands)
2020	120,769	$	79.74	(208,608)	$	15,066
2019	153,005	70.31		(182,219)	12,227
2018	437,216	64.21		(214,131)	14,768

____________________

(1)    Total fair value of RSUs vested was calculated based on the quoted closing share price of the Company’s common stock on the NYSE on the day of vesting. Excludes the issuance of dividend equivalents earned on the underlying RSUs. The dividend equivalents vest based on terms specified under the related RSU award agreement.

Summary of Nonvested Restricted Stock

We did not have any nonvested restricted stock at January 1, 2020 and 2019 or December 31, 2020 and 2019. A summary of our nonvested and vested restricted stock activity for the year ended December 31, 2018 is presented below:

	Shares Granted		Shares Vested
Years ended December 31,	Nonvested Shares Issued	Weighted-Average Grant Date Fair Value Per Share	Vested Shares	Total Fair Value at Vest Date (1) (in thousands)
2018	—	—	(22,884)	1,652

_______________________

(1)    Total fair value of shares vested was calculated based on the quoted closing share price of the Company’s common stock on the NYSE on the date of vesting.

Share-Based Compensation Cost Recorded During the Period

Share-based compensation costs for the year ended December 31, 2020 include $4.5 million of accelerated share-based compensation costs related to severance packages, including for the departure of an executive officer. The total compensation cost for all share-based compensation programs was $37.6 million, $32.8 million and $35.9 million for the years ended December 31, 2020, 2019 and 2018, respectively. Of the total share-based compensation costs, $7.4 million, $5.8 million and $8.0 million was capitalized as part of real estate assets and for 2018, deferred leasing costs, for the years ended December 31, 2020, 2019 and 2018, respectively. As of December 31, 2020, there was approximately $35.1 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 1.4 years. The remaining compensation cost related to these nonvested incentive awards had been recognized in periods prior to December 31, 2020. The $35.1 million of unrecognized compensation costs does not reflect the future compensation cost related to share-based awards that were granted subsequent to December 31, 2020.

Severance Compensation

For the year ended December 31, 2020, compensation costs included in general and administrative expenses on our consolidated statements of operations include $14.1 million of cash severance costs related to the departure of an executive officer, in addition to the accelerated share-based compensation costs noted in the paragraph above.

Other Compensation

On December 27, 2018, the Executive Compensation Committee of the Company’s Board approved, and the Company and the Operating Partnership entered into the Amended Employment Agreement with John Kilroy, which amends and supersedes the existing employment agreement dated January 1, 2012. Except as noted below, the Amended Employment Agreement continues Mr. Kilroy’s employment on terms substantially similar to those of the existing employment agreement, with a new term scheduled to continue through December 31, 2023. The Amended Employment Agreement includes a cash retirement benefit of $13.2 million, or $16.2 million for a retirement at or after attaining age 73, with at least twelve months’ advance notice or at or after the end of the term of the agreement. For the year ended December 31, 2018, the Company recognized $12.1 million of compensation expense in general and administrative expenses on the consolidated statement of operations, representing the present value of the potential cash retirement benefit amount that was earned based on prior service. For the years ended December 31, 2020 and 2019, the Company recognized $1.5 million of compensation expense in general and administrative expenses on the consolidated statement of operations related to the Amended Employment Agreement.

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Employee Benefit Plans

12 Months Ended

Dec. 31, 2020

Retirement Benefits [Abstract]

Employee Benefit Plans

Employee Benefit Plans

401(k) Plan

We have a retirement savings plan designed to qualify under Section 401(k) of the Code (the “401(k) Plan”). Our employees are eligible to participate in the 401(k) Plan on the first day of the month after three months of service. The 401(k) Plan allows eligible employees (“401(k) Participants”) to defer up to 60% of their eligible compensation on a pre-tax basis, subject to certain maximum amounts allowed by the Code. The 401(k) Plan provides for a matching contribution by the Company in an amount equal to 50 cents of each one dollar of participant contributions up to a maximum of 10% of the 401(k) Participant’s annual salary. 401(k) Participants vest immediately in the amounts contributed by us. For each of the years ended December 31, 2020, 2019, and 2018, we contributed $1.6 million, $1.6 million and $1.5 million, respectively, to the 401(k) Plan.

Deferred Compensation Plan

In 2007, we adopted the Deferred Compensation Plan, under which directors and certain management employees may defer receipt of their compensation, including up to 70% of their salaries and up to 100% of their director fees and bonuses, as applicable. In addition, employee participants will receive mandatory Company contributions to their Deferred Compensation Plan accounts equal to 10% of their gross monthly salaries, without regard to whether such employees elect to defer salary or bonus compensation under the Deferred Compensation Plan. Our Board may, but has no obligation to, approve additional discretionary contributions by the Company to Participant accounts. We hold the Deferred Compensation Plan assets in a limited rabbi trust, which is subject to the claims of our creditors in the event of bankruptcy or insolvency.

See Note 19 “Fair Value Measurements and Disclosures” for further discussion of our Deferred Compensation Plan assets as of December 31, 2020 and 2019. Our liability of $27.4 million and $27.0 million under the Deferred Compensation Plan was fully funded as of December 31, 2020 and 2019, respectively.

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Rental Income and Future Minimum Rent

12 Months Ended

Dec. 31, 2020

Leases [Abstract]

Rental Income and Future Minimum Rent

Rental Income and Future Minimum Rent

Our rental income is primarily comprised of payments defined under leases and are either subject to scheduled fixed increases or adjustments in rent based on the Consumer Price Index. Additionally, rental income includes variable payments for tenant reimbursements of property-related expenses and payments based on a percentage of tenant’s sales.

The table below sets forth the allocation of rental income between fixed and variable payments and net collectability reversals or recoveries for the years ended December 31, 2020 and 2019:

	Year Ended December 31,
	2020		2019
Fixed lease payments	$	786,860	$	708,362
Variable lease payments	124,443		115,915
Net collectability (reversals) recoveries (1)	(18,997)		2,195
Total rental income	$	892,306	$	826,472

____________________

(1)Represents adjustments to rental income related to our assessment of the collectability of amounts due under leases with our tenants. For the year ended December 31, 2020, includes $18.4 million of write-offs related to the cumulative impact of transitioning certain tenants to a cash basis of reporting primarily as a result of the COVID-19 pandemic. Also includes a $0.6 million net increase to the allowance for doubtful accounts, which includes the impact of $2.2 million of reversals to the allowance for doubtful account for tenants that had an allowance at January 1, 2020 and were subsequently transitioned to a cash basis of reporting during 2020. These reversals are included in the $18.4 million of write-offs above.

We have operating leases with tenants that expire at various dates through 2044 and are either subject to scheduled fixed increases or adjustments in rent based on the Consumer Price Index. Generally, the leases grant tenants renewal options. Leases also provide for additional rents based on certain operating expenses. Future

contractual minimum rent under operating leases, which includes amounts contractually due from leases that are on a cash basis of reporting due to creditworthiness considerations, as of December 31, 2020 for future periods is summarized as follows:

Year Ending	(in thousands)
2021	$	731,169
2022	804,488
2023	788,214
2024	750,051
2025	719,274
Thereafter	3,455,201
Total (1)	$	7,248,397

____________________

(1)Excludes residential leases and leases with a term of one year or less.

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Commitments and Contingencies

12 Months Ended

Dec. 31, 2020

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

General

As of December 31, 2020, we had commitments of approximately $614.9 million, excluding our ground lease commitments, for contracts and executed leases directly related to our operating and development properties.

Ground Leases

The following table summarizes our properties that are held subject to long-term noncancellable ground lease obligations and the respective contractual expiration dates:

Property	Contractual Expiration Date (1)
601 108th Ave NE, Bellevue, WA	November 2093
701, 801 and 837 N. 34th Street, Seattle, WA (2)	December 2041
1701 Page Mill Road and 3150 Porter Drive, Palo Alto, CA	December 2067
Kilroy Airport Center Phases I, II, and III, Long Beach, CA	July 2084
3243 S. La Cienega Boulevard, Los Angeles, CA (3)	October 2106

____________________

(1)    Reflects the contractual expiration date prior to the impact of any extension or purchase options held by the Company.

(2)    The Company has three 10-year and one 45-year extension options for this ground lease, which if exercised would extend the expiration date to December 2116. These extension options are not assumed to be exercised in our calculation of the present value of the future minimum lease payments for this lease.

(3)    We entered into this ground lease in connection with an operating property acquisition in 2019. Refer to Note 3 “Acquisitions” for additional information.

To determine the discount rates used to calculate the present value of the minimum future lease payments for our ground leases, we used a hypothetical curve derived from unsecured corporate borrowing rates over the lease term. The weighted average discount rate used to determine the present value of our minimum lease payments was 5.11%. As of December 31, 2020, the weighted average remaining lease term of our ground leases is 54 years. For the years ended December 31, 2020 and 2019, variable lease costs totaling $3.0 million and $2.9 million, respectively, were recorded to ground leases expense on our consolidated statements of operations.

The minimum commitment under our ground leases as of December 31, 2020 for future periods is as follows:

Year Ending	(in thousands)
2021	$	5,641
2022	5,642
2023	5,662
2024	5,662
2025	5,662
Thereafter	280,723
Total undiscounted cash flows (1)(2)(3)(4)(5)(6)	$	308,992
Present value discount	(211,214)
Ground lease liabilities	$	97,778

________________________

(1)Excludes contingent future rent payments based on gross income or adjusted gross income and reflects the minimum ground lease obligations before the impact of ground lease extension options.

(2)    One of our ground lease obligations is subject to a fair market value adjustment every five years; however, the lease includes ground rent subprotection and infrastructure rent credits which currently limit our annual rental obligations to $1.0 million. The contractual obligations for that ground lease included above assumes the lesser of $1.0 million or annual lease rental obligation in effect as of December 31, 2020.

(3)    One of our ground lease obligations includes a component which is based on the percentage of gross income that exceeds the minimum ground rent. The minimum rent is subject to increases every five years based on 50% of the average annual percentage rent for the previous five years. The contractual obligations for that lease included above assume the current annual ground lease obligation in effect at December 31, 2020 for the remainder of the lease term since we cannot predict future adjustments.

(4)    One of our ground lease obligations is subject to a fair market value adjustment every five years based on a combination of CPI adjustments and third-party appraisals limited to maximum increases annually. The contractual obligations for that lease included above assume the current annual ground lease obligation in effect at December 31, 2020 for the remainder of the lease term since we cannot predict future adjustments.

(5)    One of our ground lease obligations includes a component which is based on the percentage of adjusted gross income that exceeds the minimum ground rent. The minimum rent is subject to increases every 10 years by an amount equal to 60% of the average annual percentage rent for the previous three years. The contractual obligations for this lease included above assume the current annual ground lease obligation in effect at December 31, 2020 for the remainder of the lease term since we cannot predict future adjustments.

(6)    One of our ground lease obligations is subject to fixed 5% ground rent increases every five years, with the next increase occurring on December 1, 2022.

Environmental Matters

We follow the policy of monitoring all of our properties, including acquisition, development, 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 December 31, 2020 and 2019, we had accrued environmental remediation liabilities of approximately $71.3 million and $80.7 million, respectively, recorded on our consolidated balance sheets in connection with certain of our in-process and future development projects. The accrued environmental remediation liabilities represent the remaining costs we estimate we will incur prior to and during the development process at various development acquisition sites. These estimates, which we developed with the assistance of third party experts, consist primarily of the removal of contaminated soil, performing environmental closure activities, constructing remedial systems, and other related costs since we are required to dispose of any existing contaminated soil, and sometimes perform other environmental closure or remedial activities, when we develop new buildings at these sites.

We record estimated environmental remediation obligations for acquired properties at the acquisition date when we are aware of such costs and when such costs are probable of being incurred and can be reasonably estimated. Estimated costs related to development environmental remediation liabilities are recorded as an increase to the cost of the development project. Actual costs are recorded as a decrease to the liability when incurred. These accruals are adjusted as an increase or decrease to the development project costs and as an increase or decrease to the accrued environmental remediation liability if we obtain further information or circumstances change. The environmental remediation obligations recorded at December 31, 2020 and 2019 were not discounted to their present values since the amount and timing of cash payments are not fixed. It is possible that we could incur additional environmental

remediation costs in connection with these development projects.  However, potential additional environmental costs for these development projects cannot be reasonably estimated at this time and certain changes in estimates could occur as the site conditions, final project timing, design elements, actual soil conditions and other aspects of the projects, which may depend upon municipal and other approvals beyond the control of the Company, are determined.

Other than the accrued environmental liabilities discussed above, we are not aware of any unasserted claims and assessments with respect to an environmental liability that we believe would require additional disclosure or the recording of an additional loss contingency.

Litigation

We and our properties are subject to litigation arising in the ordinary course of business. To our knowledge, neither we nor any of our properties are presently subject to any litigation or threat of litigation which, if determined unfavorably to us, would have a material adverse effect on our cash flow, financial condition, or results of operations.

Insurance

We maintain commercial general liability, auto liability, employers’ liability, umbrella/excess liability, special form property, difference in conditions including earthquake and flood, environmental, rental loss, and terrorism insurance covering all of our properties. Management believes the policy specifications and insured limits are reasonable given the relative risk of loss, the cost of the coverage, and industry practice. We do not carry insurance for generally uninsurable losses such as loss from governmental action, nuclear hazard, and war and military action. Policies are subject to various terms, conditions, and exclusions and some policies may involve large deductibles or co-payments.

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Fair Value Measurements and Disclosures

12 Months Ended

Dec. 31, 2020

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 (see Note 16 “Employee Benefit Plans” for additional information). The following table sets forth the fair value of our marketable securities as of December 31, 2020 and 2019:

	Fair Value (Level 1) (1)
	2020		2019
Description	(in thousands)
Marketable securities (2)	$	27,481	$	27,098

____________________

(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 gain (loss) 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 included in general and administrative expenses on our consolidated statements of operations for the period.

The following table sets forth the net gain (loss) on marketable securities recorded during the years ended December 31, 2020, 2019 and 2018:

	December 31,
	2020		2019		2018
Description	(in thousands)
Net gain (loss) on marketable securities	$	2,864	$	3,885	$	(1,851)

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 December 31, 2020 and 2019: 

	December 31,
	2020				2019
	Carrying Value		Fair Value (1)		Carrying Value		Fair Value (1)
	(in thousands)
Liabilities
Secured debt, net	$	253,582	$	282,559	$	258,593	$	272,997
Unsecured debt, net	3,670,099		4,089,339		3,049,185		3,252,217
Unsecured line of credit	—		—		245,000		245,195

_______________

(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.

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Net Income Available to Common Stockholders Per Share of the Company

12 Months Ended

Dec. 31, 2020

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 years ended December 31, 2020, 2019 and 2018:

	Year Ended December 31,
	2020		2019		2018
	(in thousands, except unit and per unit amounts)
Numerator:
Net income attributable to common stockholders	$	187,105	$	195,443	$	258,415
Allocation to participating securities (1)	(2,229)		(2,119)		(2,004)
Numerator for basic and diluted net income available to common stockholders	$	184,876	$	193,324	$	256,411
Denominator:
Basic weighted average vested shares outstanding	113,241,341		103,200,568		99,972,359
Effect of dilutive securities	478,281		648,600		510,006
Diluted weighted average vested shares and common stock equivalents outstanding	113,719,622		103,849,168		100,482,365
Basic earnings per share:
Net income available to common stockholders per share	$	1.63	$	1.87	$	2.56
Diluted earnings per share:
Net income available to common stockholders per share	$	1.63	$	1.86	$	2.55

_____________________ 

(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, shares issuable under executed forward equity sale agreements, if any, and other securities are considered in our diluted earnings per share calculation for the years ended December 31, 2020, 2019, and 2018. Certain market measure-based RSUs are not included in dilutive securities as of December 31, 2020, 2019, and 2018 as not all performance metrics had been met by the end of the applicable reporting periods.

See Note 15 “Share-Based and Other Compensation” for additional information regarding the stock options and other share-based compensation.

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Net Income Available to Common Unitholders Per Unit of the Operating Partnership

12 Months Ended

Dec. 31, 2020

Kilroy Realty L.P. [Member]

Net Income Available To Common Unitholders [Line Items]

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 years ended December 31, 2020, 2019 and 2018:

	Year Ended December 31,
	2020		2019		2018
	(in thousands, except unit and per unit amounts)
Numerator:
Net income attributable to common unitholders	$	189,609	$	198,738	$	263,210
Allocation to participating securities (1)	(2,229)		(2,119)		(2,004)
Numerator for basic and diluted net income available to common unitholders	$	187,380	$	196,619	$	261,206
Denominator:
Basic weighted average vested units outstanding	115,095,506		105,223,975		102,025,276
Effect of dilutive securities	478,281		648,600		510,006
Diluted weighted average vested units and common unit equivalents outstanding	115,573,787		105,872,575		102,535,282
Basic earnings per unit:
Net income available to common unitholders per unit	$	1.63	$	1.87	$	2.56
Diluted earnings per unit:
Net income available to common unitholders per unit	$	1.62	$	1.86	$	2.55

____________________ 

(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, shares issuable under executed forward equity sale agreements, if any, and other securities are considered in our diluted earnings per share calculation for the years ended December 31, 2020, 2019 and 2018. Certain market measure-based RSUs are not included in dilutive securities as of December 31, 2020, 2019 and 2018 as not all performance metrics had been met by the end of the applicable reporting periods.

See Note 15 “Share-Based and Other Compensation” for additional information regarding the stock options and other share-based compensation.

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Supplemental Cash Flow Information of the Company

12 Months Ended

Dec. 31, 2020

Supplemental Cash Flow Elements [Abstract]

Supplemental Cash Flow Information of the Company

Supplemental Cash Flow Information of the Company

Supplemental cash flow information follows (in thousands):

	Year Ended December 31,
	2020		2019		2018
SUPPLEMENTAL CASH FLOWS INFORMATION:
Cash paid for interest, net of capitalized interest of $75,852, $77,666, and $65,627 as of    December 31, 2020, 2019 and 2018, respectively	$	61,741	$	43,607	$	44,697
Cash paid for amounts included in the measurement of ground lease liabilities	$	5,744	$	5,224	$	4,398
NON-CASH INVESTING TRANSACTIONS:
Accrual for expenditures for operating properties and development properties	$	189,161	$	162,654	$	158,626
Tenant improvements funded directly by tenants	$	11,592	$	10,268	$	13,968
Assumption of accrued liabilities in connection with acquisitions (Note 3)	$	—	$	10,267	$	40,624
Initial measurement of operating right of use ground lease assets (Notes 2, 3 and 18)	$	—	$	96,272	$	—
Initial measurement of operating ground lease liabilities (Notes 2, 3 and 18)	$	—	$	98,349	$	—
NON-CASH FINANCING TRANSACTIONS:
Accrual of dividends and distributions payable to common stockholders and common unitholders (Notes 13 and 27)	$	59,431	$	53,219	$	47,559
Exchange of common units of the Operating Partnership into shares of the Company’s common stock	$	37,640	$	78	$	1,962

The following is a reconciliation of our cash and cash equivalents and restricted cash at the beginning and end of the years ended December 31, 2020, 2019 and 2018.

	Year Ended December 31,
	2020		2019		2018
RECONCILIATION OF CASH AND CASH EQUIVALENTS AND RESTRICTED CASH:
Cash and cash equivalents at beginning of period	$	60,044	$	51,604	$	57,649
Restricted cash at beginning of period	16,300		119,430		9,149
Cash and cash equivalents and restricted cash at beginning of period	$	76,344	$	171,034	$	66,798
Cash and cash equivalents at end of period	$	731,991	$	60,044	$	51,604
Restricted cash at end of period	91,139		16,300		119,430
Cash and cash equivalents and restricted cash at end of period	$	823,130	$	76,344	$	171,034

Supplemental Cash Flow Information of the Operating Partnership:

Supplemental cash flow information follows (in thousands):

	Year Ended December 31,
	2020		2019		2018
SUPPLEMENTAL CASH FLOWS INFORMATION:
Cash paid for interest, net of capitalized interest of $75,852, $77,666, and $65,627 as of December 31, 2020, 2019 and 2018, respectively	$	61,741	$	43,607	$	44,697
Cash paid for amounts included in the measurement of ground lease liabilities	$	5,744	$	5,224	$	4,398
NON-CASH INVESTING TRANSACTIONS:
Accrual for expenditures for operating properties and development properties	$	189,161	$	162,654	$	158,626
Tenant improvements funded directly by tenants	$	11,592	$	10,268	$	13,968
Assumption of accrued liabilities in connection with acquisitions (Note 3)	$	—	$	10,267	$	40,624
Initial measurement of operating right of use ground lease assets (Notes 2, 3 and 18)	$	—	$	96,272	$	—
Initial measurement of operating ground lease liabilities (Notes 2, 3 and 18)	$	—	$	98,349	$	—
NON-CASH FINANCING TRANSACTIONS:
Accrual of distributions payable to common unitholders (Notes 14 and 27)	$	59,431	$	53,219	$	47,559

The following is a reconciliation of our cash and cash equivalents and restricted cash at the beginning and end of the years ended December 31, 2020, 2019 and 2018.

	Year Ended December 31,
	2020		2019		2018
RECONCILIATION OF CASH AND CASH EQUIVALENTS AND RESTRICTED CASH:
Cash and cash equivalents at beginning of period	$	60,044	$	51,604	$	57,649
Restricted cash at beginning of period	16,300		119,430		9,149
Cash and cash equivalents and restricted cash at beginning of period	$	76,344	$	171,034	$	66,798
Cash and cash equivalents at end of period	$	731,991	$	60,044	$	51,604
Restricted cash at end of period	91,139		16,300		119,430
Cash and cash equivalents and restricted cash at end of period	$	823,130	$	76,344	$	171,034

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Supplemental Cash Flow Information of the Operating Partnership

12 Months Ended

Dec. 31, 2020

Supplemental Cash Flow Elements [Abstract]

Supplemental Cash Flow Information of the Operating Partnership

Supplemental Cash Flow Information of the Company

Supplemental cash flow information follows (in thousands):

	Year Ended December 31,
	2020		2019		2018
SUPPLEMENTAL CASH FLOWS INFORMATION:
Cash paid for interest, net of capitalized interest of $75,852, $77,666, and $65,627 as of    December 31, 2020, 2019 and 2018, respectively	$	61,741	$	43,607	$	44,697
Cash paid for amounts included in the measurement of ground lease liabilities	$	5,744	$	5,224	$	4,398
NON-CASH INVESTING TRANSACTIONS:
Accrual for expenditures for operating properties and development properties	$	189,161	$	162,654	$	158,626
Tenant improvements funded directly by tenants	$	11,592	$	10,268	$	13,968
Assumption of accrued liabilities in connection with acquisitions (Note 3)	$	—	$	10,267	$	40,624
Initial measurement of operating right of use ground lease assets (Notes 2, 3 and 18)	$	—	$	96,272	$	—
Initial measurement of operating ground lease liabilities (Notes 2, 3 and 18)	$	—	$	98,349	$	—
NON-CASH FINANCING TRANSACTIONS:
Accrual of dividends and distributions payable to common stockholders and common unitholders (Notes 13 and 27)	$	59,431	$	53,219	$	47,559
Exchange of common units of the Operating Partnership into shares of the Company’s common stock	$	37,640	$	78	$	1,962

The following is a reconciliation of our cash and cash equivalents and restricted cash at the beginning and end of the years ended December 31, 2020, 2019 and 2018.

	Year Ended December 31,
	2020		2019		2018
RECONCILIATION OF CASH AND CASH EQUIVALENTS AND RESTRICTED CASH:
Cash and cash equivalents at beginning of period	$	60,044	$	51,604	$	57,649
Restricted cash at beginning of period	16,300		119,430		9,149
Cash and cash equivalents and restricted cash at beginning of period	$	76,344	$	171,034	$	66,798
Cash and cash equivalents at end of period	$	731,991	$	60,044	$	51,604
Restricted cash at end of period	91,139		16,300		119,430
Cash and cash equivalents and restricted cash at end of period	$	823,130	$	76,344	$	171,034

Supplemental Cash Flow Information of the Operating Partnership:

Supplemental cash flow information follows (in thousands):

	Year Ended December 31,
	2020		2019		2018
SUPPLEMENTAL CASH FLOWS INFORMATION:
Cash paid for interest, net of capitalized interest of $75,852, $77,666, and $65,627 as of December 31, 2020, 2019 and 2018, respectively	$	61,741	$	43,607	$	44,697
Cash paid for amounts included in the measurement of ground lease liabilities	$	5,744	$	5,224	$	4,398
NON-CASH INVESTING TRANSACTIONS:
Accrual for expenditures for operating properties and development properties	$	189,161	$	162,654	$	158,626
Tenant improvements funded directly by tenants	$	11,592	$	10,268	$	13,968
Assumption of accrued liabilities in connection with acquisitions (Note 3)	$	—	$	10,267	$	40,624
Initial measurement of operating right of use ground lease assets (Notes 2, 3 and 18)	$	—	$	96,272	$	—
Initial measurement of operating ground lease liabilities (Notes 2, 3 and 18)	$	—	$	98,349	$	—
NON-CASH FINANCING TRANSACTIONS:
Accrual of distributions payable to common unitholders (Notes 14 and 27)	$	59,431	$	53,219	$	47,559

The following is a reconciliation of our cash and cash equivalents and restricted cash at the beginning and end of the years ended December 31, 2020, 2019 and 2018.

	Year Ended December 31,
	2020		2019		2018
RECONCILIATION OF CASH AND CASH EQUIVALENTS AND RESTRICTED CASH:
Cash and cash equivalents at beginning of period	$	60,044	$	51,604	$	57,649
Restricted cash at beginning of period	16,300		119,430		9,149
Cash and cash equivalents and restricted cash at beginning of period	$	76,344	$	171,034	$	66,798
Cash and cash equivalents at end of period	$	731,991	$	60,044	$	51,604
Restricted cash at end of period	91,139		16,300		119,430
Cash and cash equivalents and restricted cash at end of period	$	823,130	$	76,344	$	171,034

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Tax Treatment of Distributions

12 Months Ended

Dec. 31, 2020

Tax Treatment of Distributions [Abstract]

Tax Treatment of Distributions

Tax Treatment of Distributions

The following table reconciles the dividends declared per share of common stock to the dividends paid per share of common stock during the years ended December 31, 2020, 2019 and 2018 as follows: 

	Year Ended December 31,
Dividends	2020		2019		2018
Dividends declared per share of common stock	$	1.970	$	1.910	$	1.790
Less: Dividends declared in the current year and paid in the following year	(0.500)		(0.485)		(0.455)
Add: Dividends declared in the prior year and paid in the current year	0.485		0.455		0.425
Dividends paid per share of common stock	$	1.955	$	1.880	$	1.760

The unaudited income tax treatment for the dividends to common stockholders reportable for the years ended December 31, 2020, 2019 and 2018 as identified in the table above was as follows: 

	Year Ended December 31,
Shares of Common Stock	2020				2019				2018
Ordinary income (1)	$	1.474	75.40	%	$	0.939	49.95	%	$	1.474	83.73	%
Qualified dividend	0.002		0.12		0.004		0.21		0.003		0.19
Return of capital	0.162		8.30		0.312		16.62		0.275		15.64
Capital gains (2)	0.275		14.05		0.600		31.93		0.008		0.44
Unrecaptured section 1250 gains	0.042		2.13		0.025		1.29		—		—
	$	1.955	100.00	%	$	1.880	100.00	%	$	1.760	100.00	%

____________________

(1)The Tax Cuts and Jobs Act enacted on December 22, 2017 generally allows a deduction for noncorporate taxpayers equal to 20% of ordinary dividends distributed by a REIT (excluding capital gain dividends and qualified dividend income). The amount of dividend eligible for this deduction is referred to as the Section 199A Dividend.  For the year ended December 31, 2020, the Section 199A Dividend is equal to the total ordinary income dividend.

(2)Capital gains are comprised entirely of 20% rate gains.

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Quarterly Financial Information of the Company (Unaudited)

12 Months Ended

Dec. 31, 2020

Quarterly Financial Information Disclosure [Abstract]

Quarterly Financial Information of the Company (Unaudited)

Quarterly Financial Information of the Company (Unaudited)

Summarized quarterly financial data for the years ended December 31, 2020 and 2019 was as follows: 

	2020 Quarter Ended (1)
	March 31,		June 30,		September 30,		December 31,
	(in thousands, except per share amounts)
Revenues	$	221,328	$	219,423	$	228,314	$	229,332
Net income	45,418		24,352		54,071		83,452
Net income attributable to Kilroy Realty Corporation	39,817		19,618		49,028		78,642
Net income available to common stockholders	39,817		19,618		49,028		78,642
Net income available to common stockholders per share – basic	0.37		0.17		0.42		0.67
Net income available to common stockholders per share – diluted	0.37		0.17		0.42		0.67
	2019 Quarter Ended (1)
	March 31,		June 30,		September 30,		December 31,
	(in thousands, except per share amounts)
Revenues	$	201,202	$	200,492	$	215,525	$	220,235
Net income	41,794		47,215		48,298		77,922
Net income attributable to Kilroy Realty Corporation	36,903		42,194		43,846		72,500
Net income available to common stockholders	36,903		42,194		43,846		72,500
Net income available to common stockholders per share – basic	0.36		0.41		0.41		0.68
Net income available to common stockholders per share – diluted	0.36		0.41		0.41		0.67

____________________

(1)    The summation of the quarterly financial data may not equal the annual number reported on the consolidated statements of operations due to rounding.

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Quarterly Financial Information of the Operating Partnership (Unaudited)

12 Months Ended

Dec. 31, 2020

Quarterly Financial Information of the Operating Partnership (Unaudited)

Quarterly Financial Information of the Company (Unaudited)

Summarized quarterly financial data for the years ended December 31, 2020 and 2019 was as follows: 

	2020 Quarter Ended (1)
	March 31,		June 30,		September 30,		December 31,
	(in thousands, except per share amounts)
Revenues	$	221,328	$	219,423	$	228,314	$	229,332
Net income	45,418		24,352		54,071		83,452
Net income attributable to Kilroy Realty Corporation	39,817		19,618		49,028		78,642
Net income available to common stockholders	39,817		19,618		49,028		78,642
Net income available to common stockholders per share – basic	0.37		0.17		0.42		0.67
Net income available to common stockholders per share – diluted	0.37		0.17		0.42		0.67
	2019 Quarter Ended (1)
	March 31,		June 30,		September 30,		December 31,
	(in thousands, except per share amounts)
Revenues	$	201,202	$	200,492	$	215,525	$	220,235
Net income	41,794		47,215		48,298		77,922
Net income attributable to Kilroy Realty Corporation	36,903		42,194		43,846		72,500
Net income available to common stockholders	36,903		42,194		43,846		72,500
Net income available to common stockholders per share – basic	0.36		0.41		0.41		0.68
Net income available to common stockholders per share – diluted	0.36		0.41		0.41		0.67

____________________

(1)    The summation of the quarterly financial data may not equal the annual number reported on the consolidated statements of operations due to rounding.

Kilroy Realty L.P. [Member]

Quarterly Financial Information of the Operating Partnership (Unaudited)

Quarterly Financial Information of the Operating Partnership (Unaudited)

Summarized quarterly financial data for the years ended December 31, 2020 and 2019 was as follows:

	2020 Quarter Ended (1)
	March 31,		June 30,		September 30,		December 31,
	(in thousands, except per unit amounts)
Revenues	$	221,328	$	219,423	$	228,314	$	229,332
Net income	45,418		24,352		54,071		83,452
Net income attributable to the Operating Partnership	40,389		19,838		49,728		79,654
Net income available to common unitholders	40,389		19,838		49,728		79,654
Net income available to common unitholders per unit – basic	0.37		0.16		0.42		0.67
Net income available to common unitholders per unit – diluted	0.36		0.16		0.42		0.67
	2019 Quarter Ended (1)
	March 31,		June 30,		September 30,		December 31,
	(in thousands, except per unit amounts)
Revenues	$	201,202	$	200,492	$	215,525	$	220,235
Net income	41,794		47,215		48,298		77,922
Net income attributable to the Operating Partnership	37,508		42,901		44,589		73,740
Net income available to common unitholders	37,508		42,901		44,589		73,740
Net income available to common unitholders per unit – basic	0.36		0.41		0.41		0.68
Net income available to common unitholders per unit – diluted	0.36		0.41		0.41		0.67

______________________

(1)    The summation of the quarterly financial data may not equal the annual number reported on the consolidated statements of operations due to rounding.

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Subsequent Events

12 Months Ended

Dec. 31, 2020

Subsequent Events [Abstract]

Subsequent Events

Subsequent Events

On January 15, 2021, $59.4 million of dividends were paid out to common stockholders, common unitholders and RSU holders of record on December 31, 2020.

On January 29, 2021, the Executive Compensation Committee granted 102,799 Time-Based RSUs to key employees under the 2006 Plan. The compensation cost related to the RSUs is expected to be recognized over a period of three years.

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Schedule II - Valuation and Qualifying Accounts

12 Months Ended

Dec. 31, 2020

SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract]

Schedule II - Valuation and Qualifying Accounts

SCHEDULE II – VALUATION AND QUALIFYING ACCOUNTS

Years ended December 31, 2020, 2019 and 2018

(in thousands)

	Balance at Beginning of Period (1)		Charged to Costs and Expenses (2)		Deductions (3)		Balance at End of Period
Allowance for Uncollectible Tenant Receivables for the year ended December 31,
2020 – Allowance for uncollectible tenant receivables	$	1,171	$	1,977	$	(1,349)	$	1,799
2019 – Allowance for uncollectible tenant receivables	512		907		(248)		1,171
2018 – Allowance for uncollectible tenant receivables	2,309		2,604		(274)		4,639
Allowance for Deferred Rent Receivables for the year ended December 31,
2020 – Allowance for deferred rent	$	1,552	$	832	$	(1,580)	$	804
2019 – Allowance for deferred rent	195		1,357		—		1,552
2018 – Allowance for deferred rent	3,238		165		(64)		3,339

____________________

(1)On January 1, 2019, the Company adopted Topic 842 on a modified retrospective basis and recognized a cumulative-effect adjustment to distributions in excess of earnings related to the allowances for uncollectible tenant receivables and deferred rent receivables. As such, the ending balances of the allowances for uncollectible tenant receivables and deferred rent receivables at December 31, 2018 do not equal the beginning balances on January 1, 2019.

(2)For the years ended December 31, 2020 and 2019, amounts do not reflect leases deemed not probable of collection for which we reversed the associated revenue under Topic 842. In addition, for the years ended December 31, 2020, 2019 and 2018, $1.7 million, $0.7 million and $2.9 million, respectively, was charged to costs and expenses for a valuation allowance for a note receivable.

(3)For the year ended December 31, 2020, includes reversals of allowance for doubtful accounts for tenants with an allowance at January 1, 2020 that were subsequently transitioned to a cash basis of reporting.

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Schedule III - Real Estate and Accumulated Depreciation

12 Months Ended

Dec. 31, 2020

SEC Schedule, 12-28, Real Estate Companies, Investment in Real Estate and Accumulated Depreciation Disclosure [Abstract]

Schedule III - Real Estate and Accumulated Depreciation

SCHEDULE III – REAL ESTATE AND ACCUMULATED DEPRECIATION

December 31, 2020

	Initial Cost								Gross Amounts at Which Carried at Close of Period
Property Location	Encumb- rances		Land and improve- ments		Buildings and Improve- ments		Costs Capitalized Subsequent  to Acquisition/ Improvement		Land and improve- ments		Buildings and Improve- ments		Total		Accumulated Depreciation		Depreci- ation Life (1)	Date of Acquisition (A)/ Construction (C) (2)		Rentable Square Feet (3) (unaudited)
	($ in thousands)
Office Properties:
3101-3243 S. La Cienega Blvd., Culver City, CA			$	150,718	$	31,033	$	227	$	150,718	$	31,259	$	181,977	$	6,127	35	2019	A	151,908
2240 E. Imperial Highway, El Segundo, CA			1,044		11,763		29,551		1,048		41,310		42,358		28,203		35	1983	C	122,870
2250 E. Imperial Highway, El Segundo, CA			2,579		29,062		36,311		2,547		65,405		67,952		56,603		35	1983	C	298,728
2260 E. Imperial Highway, El Segundo, CA			2,518		28,370		36,781		2,547		65,122		67,669		18,563		35	1983	C	298,728
909 N. Pacific Coast Highway, El Segundo, CA			3,577		34,042		51,773		3,577		85,815		89,392		44,727		35	2005	C	244,136
999 N. Pacific Coast Highway, El Segundo, CA			1,407		34,326		17,295		1,407		51,621		53,028		27,429		35	2003	C	128,588
1350 Ivar Ave., Los Angeles, CA			1,575		—		13,725		1,575		13,725		15,300		65		35	2020	C	16,448
1355 Vine St., Los Angeles, CA			17,588		—		114,603		17,588		114,603		132,191		549		35	2020	C	183,129
1375 Vine St., Los Angeles, CA			15,578		—		97,470		15,578		97,470		113,048		461		35	2020	C	159,236
1395 Vine St., Los Angeles, CA			278		—		3,138		278		3,138		3,417		16		35	2020	C	2,575
6115 W. Sunset Blvd., Los Angeles, CA (4)			1,313		3		16,454		2,455		15,315		17,770		2,787		35	2015	C	26,105
6121 W. Sunset Blvd., Los Angeles, CA (4)			11,120		4,256		43,983		8,703		50,656		59,359		8,894		35	2015	C	91,173
1525 N. Gower St., Los Angeles, CA (4)			1,318		3		9,641		1,318		9,645		10,962		1,542		35	2016	C	9,610
1575 N. Gower St., Los Angeles, CA (4)			22,153		51		119,496		22,153		119,547		141,700		15,482		35	2016	C	251,245
1500 N. El Centro Ave., Los Angeles, CA (4)			9,235		21		58,988		9,235		59,009		68,244		12,666		35	2016	C	104,504
6255 W. Sunset Blvd., Los Angeles, CA			18,111		60,320		49,265		18,111		109,585		127,696		41,735		35	2012	A	323,920
3750 Kilroy Airport Way, Long Beach, CA			—		1,941		13,113		—		15,054		15,054		11,247		35	1989	C	10,718
3760 Kilroy Airport Way, Long Beach, CA			—		17,467		16,687		—		34,154		34,154		28,166		35	1989	C	166,761
3780 Kilroy Airport Way, Long Beach, CA			—		22,319		31,855		—		54,174		54,174		41,573		35	1989	C	221,452
3800 Kilroy Airport Way, Long Beach, CA			—		19,408		22,252		—		41,660		41,660		26,473		35	2000	C	192,476
3840 Kilroy Airport Way, Long Beach, CA			—		13,586		11,755		—		25,341		25,341		16,793		35	1999	C	136,026
3880 Kilroy Airport Way, Long Beach, CA			—		9,704		11,827		—		21,531		21,531		5,220		35	1997	A	96,923
3900 Kilroy Airport Way, Long Beach, CA			—		12,615		13,208		—		25,823		25,823		19,261		35	1997	A	130,935
Kilroy Airport Center, Phase IV, Long Beach, CA (5)			—		—		4,997		—		4,997		4,997		4,997		35	—		—
8560 W. Sunset Blvd., West Hollywood, CA			9,720		50,956		1,930		9,720		52,886		62,606		8,351		35	2016	A	74,842
8570 W. Sunset Blvd., West Hollywood, CA			31,693		27,974		6,497		31,693		34,471		66,163		4,121		35	2016	A	45,941
8580 W. Sunset Blvd., West Hollywood, CA			10,013		3,695		1,219		10,013		4,914		14,927		523		35	2016	A	7,126
8590 W. Sunset Blvd., West Hollywood, CA			39,954		27,884		5,487		39,954		33,371		73,325		4,473		35	2016	A	55,302
12100 W. Olympic Blvd., Los Angeles, CA	$166,776	(6)	352		45,611		20,191		9,633		56,520		66,154		30,836		35	2003	C	152,048
12200 W. Olympic Blvd., Los Angeles, CA		(6)	4,329		35,488		25,506		3,977		61,346		65,323		42,135		35	2000	C	150,832
12233 W. Olympic Blvd., Los Angeles, CA			22,100		53,170		5,258		22,100		58,428		80,528		16,326		35	2012	A	151,029
12312 W. Olympic Blvd., Los Angeles, CA		(6)	3,325		12,202		12,345		3,399		24,473		27,872		14,923		35	1997	A	76,644
1633 26th St., Santa Monica, CA			2,080		6,672		4,006		2,040		10,718		12,758		7,497		35	1997	A	43,857
2100/2110 Colorado Ave., Santa Monica, CA			5,474		26,087		14,915		5,476		41,000		46,476		27,393		35	1997	A	102,864

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

SCHEDULE III – REAL ESTATE AND ACCUMULATED DEPRECIATION – (Continued)

December 31, 2020

	Initial Cost				Gross Amounts at Which Carried at Close of Period
Property Location	Encumb- rances	Land and improve- ments	Buildings and Improve- ments	Costs Capitalized Subsequent  to Acquisition/ Improvement	Land and improve- ments	Buildings and Improve- ments	Total	Accumulated Depreciation	Depreci- ation Life (1)	Date of Acquisition (A)/ Construction (C) (2)		Rentable Square Feet (3) (unaudited)
	($ in thousands)
3130 Wilshire Blvd., Santa Monica, CA		8,921	6,579	17,147	9,188	23,459	32,647	17,318	35	1997	A	90,074
501 Santa Monica Blvd., Santa Monica, CA		4,547	12,044	16,304	4,551	28,344	32,895	19,067	35	1998	A	76,803
12225 El Camino Real, Del Mar, CA		1,700	9,633	3,864	1,673	13,524	15,197	9,622	35	1998	A	58,401
12235 El Camino Real, Del Mar, CA		1,507	8,543	9,255	1,540	17,765	19,305	11,193	35	1998	A	53,751
12340 El Camino Real, Del Mar, CA		4,201	13,896	12,195	4,201	26,091	30,292	13,226	35	2002	C	89,272
12390 El Camino Real, Del Mar, CA		3,453	11,981	9,541	3,453	21,522	24,975	10,742	35	2000	C	70,140
12348 High Bluff Dr., Del Mar, CA		1,629	3,096	6,890	1,629	9,986	11,615	6,963	35	1999	C	39,193
12400 High Bluff Dr., Del Mar, CA		15,167	40,497	16,850	15,167	57,347	72,514	30,685	35	2004	C	210,732
12770 El Camino Real, Del Mar, CA		9,360	—	34,212	9,360	34,212	43,572	4,493	35	2015	C	73,032
12780 El Camino Real, Del Mar, CA		18,398	54,954	22,922	18,398	77,876	96,274	18,909	35	2013	A	140,591
12790 El Camino Real, Del Mar, CA		10,252	21,236	8,485	10,252	29,721	39,973	6,812	35	2013	A	78,836
12860 El Camino Real, Del Mar, CA (7)		—	—	60,675	11,326	49,349	60,675	602	35	—		—
12830 El Camino Real, Del Mar, CA (7)		—	—	134,776	28,645	106,131	134,776	885	35	—		—
3579 Valley Centre Dr., Del Mar, CA		2,167	6,897	9,559	2,858	15,765	18,623	10,397	35	1999	C	54,960
3611 Valley Centre Dr., Del Mar, CA		4,184	19,352	25,934	5,259	44,212	49,470	27,028	35	2000	C	130,109
3661 Valley Centre Dr., Del Mar, CA		4,038	21,144	18,897	4,725	39,354	44,079	24,083	35	2001	C	128,364
3721 Valley Centre Dr., Del Mar, CA		4,297	18,967	14,973	4,254	33,983	38,237	19,134	35	2003	C	115,193
3811 Valley Centre Dr., Del Mar, CA		3,452	16,152	20,540	4,457	35,687	40,144	24,154	35	2000	C	112,067
3745 Paseo Place, Del Mar, CA (Retail)		24,358	—	72,290	24,358	72,290	96,648	4,435	35	2019	C	95,871
13280 Evening Creek Dr. South, I-15 Corridor, CA		3,701	8,398	4,818	3,701	13,216	16,917	6,354	35	2008	C	41,196
13290 Evening Creek Dr. South, I-15 Corridor, CA		5,229	11,871	6,150	5,229	18,021	23,250	7,665	35	2008	C	61,180
13480 Evening Creek Dr. South, I-15 Corridor, CA		7,997	—	52,581	7,997	52,581	60,578	21,940	35	2008	C	154,157
13500 Evening Creek Dr. South, I-15 Corridor, CA		7,581	35,903	23,609	7,580	59,513	67,093	24,861	35	2004	A	137,658
13520 Evening Creek Dr. South, I-15 Corridor, CA		7,581	35,903	19,454	7,580	55,358	62,938	27,289	35	2004	A	146,701
2305 Historic Decatur Rd., Point Loma, CA		5,240	22,220	7,650	5,240	29,870	35,110	12,291	35	2010	A	107,456
4690 Executive Dr., University Towne Centre, CA		1,623	7,926	3,725	1,623	11,651	13,274	8,314	35	1999	A	47,846
4100 Bohannon Dr., Menlo Park, CA		4,835	15,526	932	4,860	16,433	21,293	5,123	35	2012	A	47,379
4200 Bohannon Dr., Menlo Park, CA		4,798	15,406	3,967	4,662	19,509	24,171	6,585	35	2012	A	45,451
4300 Bohannon Dr., Menlo Park, CA		6,527	20,958	5,373	6,470	26,387	32,858	8,557	35	2012	A	63,079
4400 Bohannon Dr., Menlo Park, CA		4,798	15,406	3,331	4,939	18,597	23,535	6,394	35	2012	A	48,146
4500 Bohannon Dr., Menlo Park, CA		6,527	20,957	3,811	6,470	24,825	31,295	7,506	35	2012	A	63,078
4600 Bohannon Dr., Menlo Park, CA		4,798	15,406	4,025	4,939	19,290	24,229	6,427	35	2012	A	48,147
4700 Bohannon Dr., Menlo Park, CA		6,527	20,958	1,584	6,470	22,599	29,069	7,112	35	2012	A	63,078
1290 - 1300 Terra Bella Ave., Mountain View, CA		28,730	27,555	61	28,730	27,616	56,346	5,702	35	2016	A	114,175

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

SCHEDULE III – REAL ESTATE AND ACCUMULATED DEPRECIATION – (Continued)

December 31, 2020

	Initial Cost					Gross Amounts at Which Carried at Close of Period
Property Location	Encumb- rances		Land and improve- ments	Buildings and Improve- ments	Costs Capitalized Subsequent  to Acquisition/ Improvement	Land and improve- ments	Buildings and Improve- ments	Total	Accumulated Depreciation	Depreci- ation Life (1)	Date of Acquisition (A)/ Construction (C) (2)		Rentable Square Feet (3) (unaudited)
	($ in thousands)
680 E. Middlefield Rd., Mountain View, CA			34,605	—	56,522	34,605	56,522	91,127	11,718	35	2014	C	170,090
690 E. Middlefield Rd., Mountain View, CA			34,755	—	56,764	34,755	56,765	91,519	11,768	35	2014	C	170,823
1701 Page Mill Rd., Palo Alto, CA			—	99,522	29	—	99,551	99,551	12,005	35	2016	A	128,688
3150 Porter Dr., Palo Alto, CA			—	21,715	410	—	22,125	22,125	3,170	35	2016	A	36,886
900 Jefferson Ave., Redwood City, CA (8)			16,668	—	109,377	18,063	107,982	126,045	19,674	35	2015	C	228,505
900 Middlefield Rd., Redwood City, CA (8)			7,959	—	50,115	8,626	49,449	58,074	8,684	35	2015	C	118,764
100 Hooper St., San Francisco, CA			78,564	—	191,895	85,510	184,949	270,459	11,632	35	2018	C	394,340
100 First St., San Francisco, CA (9)			49,150	131,238	73,238	49,150	204,476	253,626	73,294	35	2010	A	480,457
201 Third St., San Francisco, CA			19,260	84,018	69,158	19,260	153,176	172,436	65,165	35	2011	A	346,538
250 Brannan St., San Francisco, CA			7,630	22,770	10,043	7,630	32,813	40,443	11,783	35	2011	A	100,850
301 Brannan St., San Francisco, CA			5,910	22,450	7,704	5,910	30,154	36,064	11,022	35	2011	A	82,834
303 Second St., San Francisco, CA (10)			63,550	154,153	99,670	63,550	253,823	317,373	96,466	35	2010	A	784,658
333 Brannan St., San Francisco, CA			18,645	—	80,788	18,645	80,787	99,433	11,221	35	2016	C	185,602
345 Brannan St., San Francisco, CA			29,405	113,179	752	29,403	113,933	143,336	6,967	35	2018	A	110,050
350 Mission St., San Francisco, CA			52,815	—	213,312	52,815	213,312	266,127	31,186	35	2016	C	455,340
360 Third St., San Francisco, CA			—	88,235	121,629	28,504	181,360	209,864	53,833	35	2011	A	429,796
1800 Owens St., San Francisco, CA			95,388	—	437,715	95,388	437,715	533,103	20,951	35	2019	C	750,370
345 Oyster Point Blvd., South San Francisco, CA			13,745	18,575	—	13,745	18,576	32,320	1,723	35	2018	A	40,410
347 Oyster Point Blvd., South San Francisco, CA			14,071	18,289	44	14,071	18,333	32,404	1,701	35	2018	A	39,780
349 Oyster Point Blvd., South San Francisco, CA			23,112	22,601	324	23,112	22,925	46,037	2,968	35	2018	A	65,340
Kilroy Oyster Point, Phase I, South San Francisco, CA (11)			—	—	620	—	620	620	—	35	—		—
505 Mathilda Ave., Sunnyvale, CA			37,843	1,163	50,450	37,943	51,513	89,456	9,267	35	2014	C	212,322
555 Mathilda Ave., Sunnyvale, CA			37,843	1,163	50,447	37,943	51,510	89,453	9,267	35	2014	C	212,322
599 Mathilda Ave., Sunnyvale, CA			13,538	12,559	63	13,538	12,622	26,160	4,559	35	2012	A	76,031
605 Mathilda Ave., Sunnyvale, CA			29,014	891	77,282	29,090	78,096	107,187	20,542	35	2014	C	162,785
601 108th Ave., Bellevue, WA			—	214,095	40,300	—	254,395	254,395	88,958	35	2011	A	488,470
10900 NE 4th St., Bellevue, WA			25,080	150,877	45,984	25,080	196,861	221,941	62,594	35	2012	A	428,557
837 N. 34th St., Lake Union, WA			—	37,404	6,293	—	43,697	43,697	12,787	35	2012	A	112,487
701 N. 34th St., Lake Union, WA			—	48,027	8,545	—	56,572	56,572	18,277	35	2012	A	141,860
801 N. 34th St., Lake Union, WA			—	58,537	20,661	—	79,198	79,198	20,013	35	2012	A	169,412
320 Westlake Ave. North, Lake Union, WA	87,589	(12)	14,710	82,018	14,453	14,710	96,471	111,181	23,304	35	2013	A	184,644
321 Terry Ave. North, Lake Union, WA		(12)	10,430	60,003	10,366	10,430	70,369	80,799	18,091	35	2013	A	135,755
401 Terry Ave. North, Lake Union, WA			22,500	77,046	13	22,500	77,059	99,559	18,225	35	2014	A	140,605
333 Dexter Ave. North, South Lake Union, WA (13)			—	—	323,433	42,853	280,580	323,433	2,592	35	0		—

KILROY REALTY CORPORATION AND KILROY REALTY, L.P.

SCHEDULE III – REAL ESTATE AND ACCUMULATED DEPRECIATION – (Continued)

December 31, 2020

	Initial Cost									Gross Amounts at Which Carried at Close of Period
Property Location	Encumb- rances			Land and improve- ments		Buildings and Improve- ments		Costs Capitalized Subsequent  to Acquisition/ Improvement		Land and improve- ments		Buildings and Improve- ments		Total		Accumulated Depreciation		Depreci- ation Life (1)	Date of Acquisition (A)/ Construction (C) (2)		Rentable Square Feet (3) (unaudited)
	($ in thousands)
Residential Properties:
1550 N. El Centro Ave., Los Angeles, CA (4) (14)				16,970		39		136,137		16,970		136,176		153,146		17,894		35	2016	C	—
3200 Paseo Village Way, Del Mar, CA (15)				106,419		—		272,457		106,419		272,457		378,876		7,316		35	2020	C	—
TOTAL OPERATING PROPERTIES	254,365			1,496,855		2,699,959		4,215,126		1,628,848		6,783,092		8,411,940		1,798,646					14,620,166
Undeveloped land and construction in progress	—			874,773		—		903,333		874,773		903,333		1,778,106		—					—
TOTAL ALL PROPERTIES	$	254,365	(16)	$	2,371,628	$	2,699,959	$	5,118,459	$	2,503,621	$	7,686,425	$	10,190,046	$	1,798,646				14,620,166

____________________

(1)The initial costs of buildings and improvements are depreciated over 35 years using a straight-line method of accounting; improvements capitalized subsequent to acquisition are depreciated over the shorter of the lease term or useful life, generally ranging from one to 20 years.

(2)Represents our date of construction or acquisition, or of our predecessor, the Kilroy Group.

(3)Represents the square footage of our stabilized portfolio.

(4)These properties include the costs of a shared parking structure for a complex comprised of five office buildings and one residential tower. The costs of the parking structure are allocated amongst the six buildings.

(5)These costs represent infrastructure costs incurred in 1989. During the third quarter of 2009, we exercised our option to terminate the ground lease at Kilroy Airport Center, Phase IV in Long Beach, California. We had previously leased this land, which is adjacent to our office properties at Kilroy Airport Center, Long Beach, for potential future development opportunities.

(6)These properties secure a $166.8 million mortgage note.

(7)These properties are currently in the tenant improvement phase of our in-process development projects and not yet in the stabilized portfolio. The estimated rentable square feet for these properties is 285,000 rentable square feet.

(8)These properties are owned by Redwood City Partners LLC, a consolidated property partnership.

(9)This property is owned by 100 First Street Member LLC, a consolidated property partnership.

(10)This property is owned by 303 Second Street Member LLC, a consolidated property partnership.

(11)Represents the tenant funded portion of base building improvements for a project under construction.

(12)These properties secure a $87.6 million mortgage note.

(13)This property is currently in the tenant improvement phase of our in-process development projects and not yet in the stabilized portfolio. The estimated rentable square feet for this property is 635,000 rentable square feet.

(14)This property represents the 200-unit Columbia Square residential tower that was added to the stabilized portfolio in 2016.

(15)This property represents the 608-unit One Paseo residential project that was added to the stabilized portfolio in 2020.

(16)Represents gross aggregate principal amount before the effect of the deferred financing costs of $0.8 million as of December 31, 2020.

As of December 31, 2020, the aggregate gross cost of property included above for federal income tax purposes approximated $8.6 billion.

The following table reconciles the historical cost of total real estate held for investment from January 1, 2018 to December 31, 2020:

	Year Ended December 31,
	2020		2019		2018 (1)
	(in thousands)
Total real estate held for investment, beginning of year	$	9,628,773	$	8,426,632	$	7,417,777
Additions during period:
Acquisitions	—		460,512		581,671
Improvements, etc.	645,170		890,654		724,016
Total additions during period	645,170		1,351,166		1,305,687
Deductions during period:
Cost of real estate sold	(44,070)		(120,788)		(286,623)
Other	(39,827)		(28,237)		(10,209)
Total deductions during period	(83,897)		(149,025)		(296,832)
Total real estate held for investment, end of year	$	10,190,046	$	9,628,773	$	8,426,632

____________________

(1)Amounts presented in Improvements, etc. and Other have been revised for the year ended December 31, 2018 to conform to the current year presentation with amounts transferred from undeveloped land and construction in progress to land and improvements and buildings and improvements presented on a net basis, which did not have any impact on total real estate held for investment at December 31, 2018.

The following table reconciles the accumulated depreciation from January 1, 2018 to December 31, 2020:

	Year Ended December 31,
	2020		2019		2018
	(in thousands)
Accumulated depreciation, beginning of year	$	1,561,361	$	1,391,368	$	1,264,162
Additions during period:
Depreciation of real estate	244,815		211,893		198,578
Total additions during period	244,815		211,893		198,578
Deductions during period:
Write-offs due to sale	(6,401)		(41,655)		(71,372)
Other	(1,129)		(245)		—
Total deductions during period	(7,530)		(41,900)		(71,372)
Accumulated depreciation, end of year	$	1,798,646	$	1,561,361	$	1,391,368

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Basis of Presentation and Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2020

Basis of Presentation and Significant Accounting Policies [Abstract]

Basis of Presentation

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, 303 Second LLC, 100 First LLC, 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, 303 Second LLC, 100 First LLC, Redwood LLC and all of our wholly-owned and controlled subsidiaries. All intercompany balances and transactions have been eliminated in the consolidated financial statements.

Partially Owned Entities and Variable Interest Entities

Our accounting policy is to consolidate entities in which we have a controlling financial interest and significant decision making control over the entity's operations. In determining whether we have a controlling financial interest in a partially owned entity and the requirement to consolidate the accounts of that entity, we consider factors such as ownership interest, board representation, management representation, size of our investment (including loans), authority to control decisions, and contractual and substantive participating rights of the members. In addition to evaluating control rights, we consolidate entities in which the other members have no substantive kick-out rights to remove the Company as the managing member.

Entities in which the equity investors do not have sufficient equity at risk to finance their endeavors without additional financial support or the holders of the equity investment at risk do not have a controlling financial interest are VIEs. We evaluate whether an entity is a VIE and whether we are the primary beneficiary. We are deemed to be the primary beneficiary of a VIE when we have the power to direct the activities of the VIE that most significantly impact the VIEs’ economic performance and the obligation to absorb losses or receive benefits that could potentially be significant to the VIE.

If the requirements for consolidation are not met, the Company would account for investments under the equity method of accounting if we have the ability to exercise significant influence over the entity. Equity method investments would be initially recorded at cost and subsequently adjusted for our share of net income or loss and cash contributions and distributions each period.

Accounting Pronouncement Adopted and Accounting Standards Issued But Not Yet Effective

Accounting Pronouncements Adopted January 1, 2020

ASU No. 2016-13 “Financial Instruments - Credit Losses (Topic 326)”

Effective January 1, 2020, we adopted Financial Accounting Standards Board (“FASB”) FASB Accounting Standards Update (“ASU”) No. 2016-13 (“ASU 2016-13”), which amends 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.  In November 2018, the FASB released ASU No. 2018-19 “Codification Improvements to Topic 326, Financial Instruments - Credit Losses.” This ASU clarifies that receivables arising from operating leases are not within the scope of Subtopic 326-20 “Financial Instruments – Credit Losses.” Instead, impairment of receivables arising from operating leases should be accounted for under Subtopic 842-30 “Leases – Lessor.” The adoption did not have a material impact on our consolidated financial statements or notes to our consolidated financial statements.

ASU No. 2018-13 “Fair Value Measurement (Topic 820)”

Effective January 1, 2020, we adopted FASB ASU No. 2018-13 (“ASU 2018-13”), which amends the disclosure requirements for fair value measurements. The amendments in ASU 2018-13 include new, modified and eliminated disclosure requirements and are the result of a broader disclosure project called FASB Concepts Statement, Conceptual Framework for Financial Reporting - Chapter 8: Notes to Financial Statements (the “Concepts Statement”), which the FASB finalized on August 28, 2018. The FASB used the guidance in the Concepts Statement to improve the effectiveness of Topic 820’s disclosure requirements. The adoption did not have a material impact on our consolidated financial statements or notes to our consolidated financial statements.

ASU No. 2018-15 “Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40)”

Effective January 1, 2020, we adopted FASB ASU No. 2018-15 (“ASU 2018-15”), which amends a customer’s accounting for implementation costs incurred in a cloud computing arrangement that is a service contract. ASU 2018-15 aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). The adoption did not have a material impact on our consolidated financial statements or notes to our consolidated financial statements.

COVID-19 Lease Modification Accounting Relief

The global impact of the COVID-19 pandemic continues to evolve rapidly. Both of the states where we own properties and/or have development projects (i.e., California and Washington), have reacted to the COVID-19 pandemic by instituting quarantines, restrictions on travel, “shelter in place” rules, restrictions on types of business that may continue to operate and/or restrictions on types of construction projects that may continue. These restrictions have impacted our business, as well as that of our tenants.

Due to the business disruptions and challenges severely affecting the global economy caused by the COVID-19 pandemic, many lessors may be required to provide rent deferrals and other lease concessions to lessees. While the lease modification guidance in Accounting Standards Codification (“ASC”) Topic 842 (“Topic 842”) addresses routine changes to lease terms resulting from negotiations between the lessee and the lessor, this guidance did not contemplate concessions being so rapidly executed to address the sudden liquidity constraints of some lessees arising from the COVID-19 pandemic and restrictions intended to prevent its spread.

In April 2020, the FASB staff issued a question and answer document (the “Lease Modification Q&A”) focused on the application of lease accounting guidance to lease concessions provided as a result of the COVID-19 pandemic. Under existing lease guidance, the Company would have to determine, on a lease by lease basis, if a lease concession was the result of a new arrangement reached with the tenant (treated within the lease modification accounting framework) or if a lease concession was under the enforceable rights and obligations within the existing lease agreement (precluded from applying the lease modification accounting framework). The Lease Modification Q&A allows the Company, if certain criteria have been met, to bypass the lease by lease analysis, and instead elect to either apply the lease modification accounting framework or not, with such election applied consistently to leases

with similar characteristics and similar circumstances. The Company has elected to apply such relief and availed itself of the election to avoid performing a lease by lease analysis. In addition, the Company has elected to apply the lease modification accounting framework consistently to leases within the property types in which it invests, specifically office, life science, residential and retail properties.

Revenue Recognition, Base Rent, Additional Rent - Reimbursements from Tenants, Other Property Income, Uncollectible Lease Receivables and Allowance for Tenant and Deferred Rent Receivables

Revenue Recognition

Rental revenue for office, life science and retail operating properties is our principal source of revenue. We recognize revenue from base rent, additional rent (which consists of amounts due from tenants for common area maintenance, real estate taxes, and other recoverable costs), parking and other lease-related revenue once all of the following criteria are met: (i) the agreement has been fully executed and delivered, (ii) services have been rendered, (iii) the amount is fixed or determinable and (iv) payment has been received or the collectability of the amount due is probable. Lease termination fees are amortized over the remaining lease term, if applicable. If there is no remaining lease term, they are recognized when received and realized. Minimum annual rental revenues are recognized in rental revenues on a straight-line basis over the non-cancellable term of the related lease.

Base Rent

The timing of when we commence rental revenue recognition for office, life science and retail properties depends largely on our conclusion as to whether the Company or the tenant is the owner for accounting purposes of tenant improvements at the leased property. When we conclude that we are the owner of tenant improvements for accounting purposes, we record the cost to construct the tenant improvements as an asset and commence rental revenue recognition when the tenant takes possession of or controls the finished space, which is generally when tenant improvements being recorded as our assets are substantially complete. In certain instances, when we conclude that the tenant is the owner of certain tenant improvements for accounting purposes, rental revenue recognition begins when the tenant takes possession or controls the physical use of the leased space, which may occur in phases or for an entire building or project. The determination of who owns the tenant improvements is made on a lease-by-lease basis and has a significant effect on the timing of commencement of revenue recognition.

When we conclude that the Company is the owner of tenant improvements for accounting purposes, we record the cost to construct the tenant improvements, including costs paid for or reimbursed by the tenants, as a capital asset. For these tenant-funded tenant improvements, we record the amount funded by or reimbursed by tenants as deferred revenue, which is amortized and recognized as rental income on a straight-line basis over the term of the related lease.

When we conclude that the tenant is the owner of certain tenant improvements for accounting purposes, we record our contribution towards those tenant-owned improvements as a lease incentive, which is included in deferred leasing costs and acquisition-related intangible assets, net on our consolidated balance sheets and amortized as a reduction to rental revenue on a straight-line basis over the term of the related lease.

For residential properties, we commence revenue recognition upon lease commencement. Residential rental revenue is recognized on a straight-line basis over the term of the related lease, net of any concessions.

Additional Rent - Reimbursements from Tenants

Additional rent, consisting of amounts due from tenants for common area maintenance, real estate taxes and other recoverable costs, are recognized in rental income in the period the recoverable costs are incurred. Prior to the adoption of Topic 842 on January 1, 2019, such amounts were recognized in revenue as tenant reimbursements. Additional rent where we pay the associated costs directly to third-party vendors and are reimbursed by our tenants are recognized and recorded on a gross basis, with the corresponding expense recognized in property expenses or real estate taxes. Prior to the adoption of Topic 842, recoverable costs were generally recognized and recorded on a gross basis when we were the primary obligor with respect to purchasing goods and services from third-party suppliers, had discretion in selecting the supplier, and had credit risk.

Other Property Income

Other property income primarily includes amounts recorded in connection with transient daily parking, tenant bankruptcy settlement payments, broken deal income and property damage settlement related payments. Other property income also includes miscellaneous income from tenants, restoration fees and fees for late rental payments. Amounts recorded within other property income fall within the scope of Topic 606 and are recognized as revenue at the point in time when control of the goods or services transfers to the customer and our performance obligation is satisfied. Prior to the adoption of Topic 842 on January 1, 2019, other property income primarily included amounts recorded in connection with lease terminations, tenant bankruptcy settlement payments, broken deal income and property damage settlement payments.

Uncollectible Lease Receivables and Allowances for Tenant and Deferred Rent Receivables

We carry our current and deferred rent receivables net of allowances for amounts that may not be collected. Prior to the adoption of Topic 842 on January 1, 2019, the allowances were increased or decreased through provision for bad debts on our consolidated statements of operations. Upon the adoption of Topic 842 on January 1, 2019, the allowances are increased or decreased through rental income, and our determination of the adequacy of the Company’s allowances for tenant receivables includes a binary assessment of whether or not substantially all of the amounts due under a tenant’s lease agreement are probable of collection. Such assessment involves using a methodology that incorporates a specific identification analysis and an aging analysis and considers the current economic and business environment. This determination requires significant judgment and estimates about matters that are uncertain at the time the estimates are made, including the creditworthiness of specific tenants, specific industry trends and conditions, and general economic trends and conditions. For leases that are deemed probable of collection, revenue continues to be recorded on a straight-line basis over the lease term. For leases that are deemed not probable of collection, revenue is recorded as the lesser of (i) the amount which would be recognized on a straight-line basis or (ii) cash that has been received from the tenant, including deferred revenue, with any tenant and deferred rent receivable balances charged as a direct write-off against rental income in the period of the change in the collectability determination.

For tenant and deferred rent receivables associated with leases whose rents are deemed probable of collection under Topic 842, we may record an allowance under other authoritative GAAP using a methodology that incorporates a specific identification analysis and an aging analysis and considers the current economic and business environment. This determination requires significant judgment and estimates about matters that are uncertain at the time the estimates are made, including the creditworthiness of specific tenants, specific industry trends and conditions, and general economic trends and conditions. Tenant and deferred rent receivables deemed probable of collection are carried net of allowances for uncollectible accounts, with increases or decreases in the allowances recorded through rental income on our consolidated statements of operations. Prior to the adoption of Topic 842 on January 1, 2019, the allowances were increased or decreased through provision for bad debts on our consolidated statements of operations.

Current tenant receivables consist primarily of amounts due for contractual lease payments and reimbursements of common area maintenance expenses, property taxes, and other costs recoverable from tenants. With respect to the allowance for uncollectible tenant receivables, the specific identification methodology analysis relies on factors such as the age and nature of the receivables, the payment history and financial condition of the tenant, our assessment of the tenant’s ability to meet its lease obligations, and the status of negotiations of any disputes with the tenant.

Deferred rent receivables represent the amount by which the cumulative straight-line rental revenue recorded to date exceeds cash rents billed to date under the lease agreement. With respect to the allowance for deferred rent receivables, given the longer-term nature of these receivables, the specific identification methodology analysis evaluates each of our significant tenants and any tenants on our internal watchlist and relies on factors such as each tenant’s financial condition and its ability to meet its lease obligations. We evaluate our reserve levels quarterly based on changes in the financial condition of tenants and our assessment of the tenant’s ability to meet its lease obligations, overall economic conditions, and the current business environment.

Acquisitions

Acquisitions

Acquisitions of operating properties and development and redevelopment opportunities generally do not meet the definition of a business and are accounted for as asset acquisitions, as substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets. For these asset acquisitions, we record the acquired tangible and intangible assets and assumed liabilities based on each asset’s and liability’s relative fair value at the acquisition date of the total purchase price plus any capitalized acquisition costs. We record the acquired tangible and intangible assets and assumed liabilities of acquisitions of operating properties and development and redevelopment opportunities that meet the accounting criteria to be accounted for as business combinations at fair value at the acquisition date. Transaction costs associated with asset acquisitions, including costs incurred during negotiation, are capitalized in addition to the purchase price of the acquisition.

The acquired assets and assumed liabilities for an acquisition generally include but are not limited to (i) land and improvements, buildings and improvements, undeveloped land and construction in progress and (ii) identified tangible and intangible assets and liabilities associated with in-place leases, including tenant improvements, leasing costs, value of above-market and below-market operating leases and ground leases, acquired in-place lease values and tenant relationships, if any. Any debt assumed and equity (including common units of the Operating Partnership) issued in connection with a property acquisition is recorded at fair value on the date of acquisition.

The fair value of land and improvements is derived from comparable sales of land and improvements within the same submarket and/or region. The fair value of buildings and improvements, tenant improvements and leasing costs considers the value of the property as if it was vacant as well as current replacement costs and other relevant market rate information.

The fair value of the above-market or below-market component of an acquired in-place operating lease is based upon the present value (calculated using a market discount rate) of the difference between (i) the contractual rents to be paid pursuant to the lease over its remaining non-cancellable lease term and (ii) our estimate of the rents that would be paid using fair market rental rates and rent escalations at the date of acquisition measured over the remaining non-cancellable term of the lease for above-market operating leases and the initial non-cancellable term plus the term of any below-market fixed rate renewal options, if applicable, for below-market operating leases. Our below-market operating leases generally do not include fixed rate or below-market renewal options. The amounts recorded for above-market operating leases are included in deferred leasing costs and acquisition-related intangible assets, net on the balance sheet and are amortized on a straight-line basis as a reduction of rental income over the remaining term of the applicable leases. The amounts recorded for below-market operating leases are included in deferred revenue and acquisition-related intangible liabilities, net on the balance sheet and are amortized on a straight-line basis as an increase to rental income over the remaining term of the applicable leases plus the term of any below-market fixed rate renewal options, if applicable. The amortization of a below-market ground lease obligation is recorded as an increase to ground lease expense in the consolidated statements of operations for the periods presented. The amortization of an 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 fair value of acquired in-place leases is derived based on our assessment of lost revenue and costs incurred for the period required to lease the “assumed vacant” property to the occupancy level when purchased. The amount recorded for acquired in-place leases is included in deferred leasing costs and acquisition-related intangible assets, net on the balance sheet and amortized as an increase to depreciation and amortization expense over the remaining term of the applicable leases. Fully amortized intangible assets are written off each quarter.

Operating Properties and Cost Capitalization and Depreciation and Amortization of Buildings and Improvements

Operating Properties

Operating properties are generally carried at historical cost less accumulated depreciation. Properties held for sale are reported at the lower of the carrying value or the fair value less estimated cost to sell. The cost of operating properties includes the purchase price or development costs of the properties. Costs incurred for the renovation and betterment of the operating properties are capitalized to our investment in that property. Maintenance and repairs are charged to expense as incurred.

When evaluating properties to be held and used for potential impairment, we first evaluate whether there are any indicators of impairment for any of our properties. If any impairment indicators are present for a specific property, we then evaluate the regional market conditions that could reasonably affect the property. If there are negative changes and trends in that regional market, we then perform an undiscounted cash flow analysis and compare the net carrying amount of the property to the property’s estimated undiscounted future cash flow over the anticipated holding period. If the estimated undiscounted future cash flow is less than the net carrying amount of the property, we perform an impairment loss calculation to determine if the fair value of the property is less than the net carrying value of the property. Our impairment loss calculation compares the net carrying amount of the property to the property’s estimated fair value, which may be based on estimated discounted future cash flow calculations or third-party valuations or appraisals. We would recognize an impairment loss if the property's net carrying amount exceeds the property's estimated fair value. If we were to recognize an impairment loss, the estimated fair value of the property becomes its new cost basis. For a depreciable long-lived asset, the new cost basis would be depreciated (amortized) over the remaining useful life of that asset.

Cost Capitalization

All costs clearly associated with the development, redevelopment and construction of a property are capitalized as project costs, including internal compensation costs. In addition, the following costs are capitalized as project costs during periods in which activities necessary to prepare development and redevelopment properties for their intended use are in progress: pre-construction costs essential to the development of the property, interest, real estate taxes and insurance.

•For office, life science and retail development and redevelopment properties that are pre-leased, we cease capitalization when revenue recognition commences, which is upon substantial completion of tenant improvements deemed to be the Company’s asset for accounting purposes.

•For office, life science and retail development and redevelopment properties that are not pre-leased, we may not immediately build out the tenant improvements. Therefore, we cease capitalization when revenue recognition commences upon substantial completion of the tenant improvements deemed to be the Company's asset for accounting purposes, but in any event, no later than one year after the cessation of major construction activities. We also cease capitalization on a development or redevelopment property when activities necessary to prepare the property for its intended use have been suspended.

•For office, life science and retail development or redevelopment properties with multiple tenants and phased leasing, we cease capitalization and begin depreciation on the portion of the development or redevelopment property for which revenue recognition has commenced.

•For residential development properties, we cease capitalization when the property is substantially complete and available for occupancy.

Once major base building construction activities have ceased and the development or redevelopment property or phases of the development or redevelopment project is placed in service, which may occur in phases or for an entire building or project, the costs capitalized to construction in progress are transferred to land and improvements, buildings and improvements, and deferred leasing costs on our consolidated balance sheets as the historical cost of the property.

Depreciation and Amortization of Buildings and ImprovementsThe costs of buildings and improvements and tenant improvements are depreciated using the straight-line method of accounting over the estimated useful lives set forth in the table below.

Real Estate Assets Held for Sale, Dispositions and Discontinued Operations

Real Estate Assets Held for Sale, Dispositions and Discontinued Operations

A real estate asset is classified as held for sale when certain criteria are met, including but not limited to the availability of the asset for immediate sale, the existence of an active program to locate a buyer and the probable sale or transfer of the asset within one year. If such criteria are met, we present the applicable assets and liabilities related to the real estate asset, if material, separately on the balance sheet as held for sale and we would cease to record depreciation and amortization expense. Real estate assets held for sale are reported at the lower of their carrying value or their estimated fair value less the estimated costs to sell. As of December 31, 2020 and 2019, we did not have any properties classified as held for sale.

Property disposals representing a strategic shift that have (or will have) a major effect on the Company’s operations and financial results, such as a major line of business, a major geographical area or a major equity investment, are required to be presented as discontinued operations. If we were to determine that a property disposition represents a strategic shift, the revenues, expenses and net gain (loss) on dispositions of the property would be recorded in discontinued operations for all periods presented through the date of the applicable disposition. The operations of the properties sold during the years ended December 31, 2020, 2019 and 2018 are presented in continuing operations as they did not represent a strategic shift in the Company’s operations and financial results.

The net gains (losses) on dispositions of non-depreciable real estate property, including land, are reported in the consolidated statements of operations as gains (losses) on sale of land within continuing operations in the period the land is sold. The net gains (losses) on dispositions of depreciable real estate property are reported in the consolidated statements of operations as gains on sales of depreciable operating properties within continuing operations in the period the property is sold

Cash and Cash Equivalents

Cash and Cash EquivalentsWe consider all highly-liquid investments with original maturities of three months or less to be cash equivalents

Restricted Cash

Restricted CashRestricted cash consists of cash proceeds from dispositions that are temporarily held at qualified intermediaries for purposes of facilitating potential Section 1031 Exchanges and cash held in escrow related to acquisition and disposition holdbacks. Restricted cash also includes cash held as collateral to provide credit enhancement for the Operating Partnership’s mortgage debt, including cash reserves for capital expenditures, tenant improvements and property taxes.

Marketable Securities

Marketable securities reported in our consolidated balance sheets represent the assets held in connection with the Kilroy Realty Corporation 2007 Deferred Compensation Plan (the “Deferred Compensation Plan”) (see Note 16 “Employee Benefit Plans” for additional information). The Deferred Compensation Plan assets are held in a limited rabbi trust and invested in various mutual and money market funds. As a result, the marketable securities are treated as trading securities for financial reporting purposes and are adjusted to fair value at the end of each accounting period, with the corresponding gains and losses recorded in interest income and other net investment gains (losses).

Deferred Compensation Plan

At the time eligible management employees (“Participants”) defer compensation or earn mandatory Company contributions, or if we were to make a discretionary contribution, we record compensation cost and a corresponding deferred compensation plan liability, which is included in accounts payable, accrued expenses, and other liabilities on our consolidated balance sheets. This liability is adjusted to fair value at the end of each accounting period based on the performance of the benchmark funds selected by each Participant, and the impact of adjusting the liability to fair value is recorded as an increase or decrease to compensation cost. The impact of adjusting the deferred compensation plan liability to fair value and the changes in the value of the marketable securities held in connection with the Deferred Compensation Plan generally offset and therefore do not significantly impact net income.

Deferred Leasing Costs

Deferred Leasing Costs

Costs incurred in connection with successful property leasing are capitalized as deferred leasing costs and classified as investing activities in the statement of cash flows. Under Topic 842, initial direct costs include only those costs that are incremental to the arrangement and would not have been incurred if the lease had not been obtained. As a result, subsequent to the adoption of Topic 842 on January 1, 2019, deferred leasing costs consist of leasing commissions paid to external third party brokers and lease incentives, and the Company no longer capitalizes internal leasing costs and third-party legal leasing costs. Prior to the adoption of Topic 842, deferred leasing costs consisted primarily of leasing commissions, lease incentives, legal costs and certain internal payroll costs. Deferred leasing costs are amortized using the straight-line method of accounting over the lives of the leases which generally range from one to 20 years. We may reevaluate the remaining useful lives of leasing costs as the creditworthiness of our tenants and economic and market conditions change. If we determine that the estimated remaining life of a lease has changed, we adjust the amortization period accordingly. Fully amortized deferred leasing costs are written off each quarter.

Deferred Financing Costs, and Debt Discounts and Premiums

Deferred Financing Costs

Financing costs related to the origination or assumption of long-term debt are deferred and generally amortized using the straight-line method of accounting, which approximates the effective interest method, over the contractual terms of the applicable financings. Fully amortized deferred financing costs are written off when the corresponding financing is repaid.

Debt Discounts and Premiums

Original issuance debt discounts and discounts/premiums related to recording debt acquired in connection with operating property acquisitions at fair value are generally amortized and accreted on a straight-line basis, which approximates the effective interest method. Discounts are recorded as additional interest expense from date of issuance or acquisition through the contractual maturity date of the related debt. Premiums are recorded as a reduction to interest expense from the date of issuance or acquisition through the contractual maturity date of the related debt.

Noncontrolling Interests and Common Partnership Interests

Noncontrolling Interests - Common Units of the Operating Partnership in the Company's Consolidated Financial Statements

Common units of the Operating Partnership within noncontrolling interests in the Company’s consolidated financial statements represent the common limited partnership interests in the Operating Partnership not held by the Company (“noncontrolling common units”). Noncontrolling common units are presented in the equity section of the

Company’s consolidated balance sheets and are reported at their proportionate share of the net assets of the Operating Partnership. Noncontrolling interests with redemption provisions that permit the issuer to settle in either cash or shares of common stock must be further evaluated to determine whether equity or temporary equity classification on the balance sheet is appropriate. Since the common units contain such a provision, we evaluated the accounting guidance and determined that the common units qualify for equity presentation in the Company’s consolidated financial statements. Net income attributable to noncontrolling common units is allocated based on their relative ownership percentage of the Operating Partnership during the reported period. The noncontrolling interest ownership percentage is determined by dividing the number of noncontrolling common units by the total number of common units outstanding. The issuance or redemption of additional shares of common stock or common units results in changes to the noncontrolling interest percentage as well as the total net assets of the Company. As a result, all equity transactions result in an allocation between equity and the noncontrolling interest in the Company’s consolidated balance sheets and statements of equity to account for the changes in the noncontrolling interest ownership percentage as well as the change in total net assets of the Company.

Noncontrolling Interests in Consolidated Property Partnerships

Noncontrolling interests in consolidated property partnerships represent the equity interests held by unrelated third parties in our three consolidated property partnerships (see Note 11 “Noncontrolling Interests on the Company’s Consolidated Financial Statements” and see Note 12 “Noncontrolling Interests on the Operating Partnership’s Consolidated Financial Statements”). Noncontrolling interests in consolidated property partnerships are not redeemable and are presented as permanent equity in the Company's consolidated balance sheets. We account for the noncontrolling interests in consolidated property partnerships using the hypothetical liquidation at book value (“HLBV”) method to attribute the earnings or losses of the consolidated property partnerships between the controlling and noncontrolling interests. Under the HLBV method, the amounts reported as noncontrolling interests in consolidated property partnerships in the consolidated balance sheets represent the amounts the noncontrolling interests would hypothetically receive at each balance sheet reporting date under the liquidation provisions of the governing agreements assuming the net assets of the consolidated property partnerships were liquidated at recorded amounts and distributed between the controlling and noncontrolling interests in accordance with the governing documents. The net income attributable to noncontrolling interests in consolidated property partnerships in the consolidated statements of operations is associated with the increase or decrease in the noncontrolling interest holders’ contractual claims on the respective entities’ balance sheets assuming a hypothetical liquidation at the end of that reporting period when compared with their claims on the respective entities’ balance sheets assuming a hypothetical liquidation at the beginning of that reporting period, after removing any contributions or distributions.

Common Partnership Interests on the Operating Partnership’s Consolidated Balance Sheets

The common units held by the Company and the noncontrolling common units held by the common limited partners are both presented in the permanent equity section of the Operating Partnership’s consolidated balance sheets in partners’ capital. The redemption rights of the noncontrolling common units permit us to settle the redemption obligation in either cash or shares of the Company’s common stock at our option (see Note 11 “Noncontrolling Interests on the Company’s Consolidated Financial Statements” for additional information).

Noncontrolling Interests on the Operating Partnership’s Consolidated Financial Statements

Noncontrolling interests in the Operating Partnership’s consolidated financial statements include the noncontrolling interest in property partnerships (see Note 12 “Noncontrolling Interests on the Operating Partnership’s Consolidated Financial Statements”). As of December 31, 2019, noncontrolling interests in the Operating Partnership’s consolidated financial statements also included the Company’s 1.0% general partnership interest in Kilroy Realty Finance Partnership, L.P. in the permanent equity section of the Operating Partnership’s consolidated balance sheets given that these interests were not convertible or redeemable into any other ownership interest of the Company or the Operating Partnership.

Equity Offerings

Equity Offerings

Underwriting commissions and offering costs incurred in connection with common equity offerings and our at-the-market stock offering program (see Note 13 “Stockholders’ Equity of the Company”) are reflected as a reduction of additional paid-in capital. Issuance costs incurred in connection with preferred equity offerings are reflected as a reduction of the carrying value of the preferred equity.

Sales of our common stock under forward equity sale agreements (such as those under the forward equity offering entered into in February 2020 and those under the 2018 At-The-Market Program, as discussed in Note 13 “Stockholders’ Equity of the Company”) meet the derivatives and hedging guidance scope exception to be accounted for as equity instruments based on the following assessment: (i) none of the agreements’ exercise contingencies were based on observable markets or indices besides those related to the market for our own stock price and operations; and (ii) none of the settlement provisions precluded the agreements from being indexed to our own stock.

The net proceeds from any equity offering of the Company are generally contributed to the Operating Partnership in exchange for a number of common units equivalent to the number of shares of common stock issued and are reflected in the Operating Partnership’s consolidated financial statements as an increase in partners’ capital.

Share-based Incentive Compensation Accounting

Share-based Incentive Compensation Accounting

Compensation cost for all share-based awards, including options, requires measurement at estimated fair value on the grant date. Compensation cost is recognized on a straight-line basis over the service vesting period, which represents the requisite service period. The grant date fair value of market measure-based share-based compensation plans are calculated using a Monte Carlo simulation pricing model. The grant date fair value of stock option grants is calculated using the Black-Scholes valuation model. Equity awards settled in cash are valued at the fair value of our common stock on the period end date through the settlement date. Equity awards settled in cash are remeasured at each reporting period and are recognized as a liability in the consolidated balance sheet during the vesting period until settlement. Forfeitures of all share-based awards are recognized when they occur.

For share-based awards in which the performance period precedes the grant date, we recognize compensation cost over the requisite service period, which includes both the performance and service vesting periods, using the accelerated attribution expense method. The requisite service period begins on the date the Executive Compensation Committee authorizes the award and adopts any relevant performance measures.

For share-based awards with performance-based measures, the total estimated compensation cost is based on our most recent estimate of the probable achievement of the pre-established specific corporate performance measures. These estimates are based on actual results and our latest internal forecasts for each performance measure. For share-based awards with market measures, the total estimated compensation cost is based on the fair value of the award at the grant date. For share-based awards with performance-based measures and market measures, the total estimated compensation cost is based on the fair value per share at the grant date multiplied by our most recent estimate of the number of shares to be earned based on actual results and the probable achievement of the pre-established corporate performance measures based on our latest internal forecasts.

In accordance with the provisions of our share-based incentive compensation plan, we accept the return of shares of Company common stock, at the current quoted market price, from employees to satisfy minimum statutory tax-withholding requirements related to shares that vested during the period.

For share-based awards granted by the Company, the Operating Partnership issues a number of common units equal to the number of shares of common stock ultimately granted by the Company in respect of such awards.

Basic and Diluted Net Income Available to Common Stockholders per Share

Basic and Diluted Net Income Available to Common Stockholders per Share

Basic net income available to common stockholders per share is computed by dividing net income available to common stockholders, after preferred distributions and the allocation of income to participating securities, by the

weighted-average number of shares of common stock outstanding for the period. Diluted net income available to common stockholders per share is computed by dividing net income available for common stockholders, after preferred distributions and the allocation of income to participating securities, by the sum of the weighted-average number of shares of common stock outstanding for the period plus the assumed exercise of all dilutive securities. The impact of the outstanding common units is considered in the calculation of diluted net income available to common stockholders per share. The common units are not reflected in the diluted net income available to common stockholders per share calculation because the exchange of common units into common stock is on a one for one basis, and the common units are allocated net income on a per share basis equal to the common stock (see Note 21 “Net Income Available to Common Stockholders Per Share of the Company”). Accordingly, any exchange would not have any effect on diluted net income (loss) available to common stockholders per share.

Nonvested share-based payment awards (including nonvested restricted stock units (“RSUs”), vested market-measure RSUs and vested dividend equivalents issued to holders of RSUs) containing nonforfeitable rights to dividends or dividend equivalents are accounted for as participating securities and included in the computation of basic and diluted net income available to common stockholders per share pursuant to the two-class method. The dilutive effect of shares issuable under executed forward equity sale agreements, if any, and stock options are reflected in the weighted average diluted outstanding shares calculation by application of the treasury stock method. The dilutive effect of the outstanding nonvested shares of common stock (“nonvested shares”) and RSUs that have not yet been granted but are contingently issuable under the share-based compensation programs is reflected in the weighted average diluted shares calculation by application of the treasury stock method at the beginning of the quarterly period in which all necessary conditions have been satisfied.

Basic and Diluted Net Income Available to Common Unitholders per Unit

Basic net income available to common unitholders per unit is computed by dividing net income available to common unitholders, after preferred distributions and the allocation of income to participating securities, by the weighted-average number of vested common units outstanding for the period. Diluted net income available to common unitholders per unit is computed by dividing net income available to common unitholders, after preferred distributions and the allocation of income to participating securities, by the sum of the weighted-average number of common units outstanding for the period plus the assumed exercise of all dilutive securities.

The dilutive effect of stock options, outstanding nonvested shares, RSUs, awards containing nonforfeitable rights to dividend equivalents and shares issuable under executed forward equity sale agreements, if any, are reflected in diluted net income available to common unitholders per unit in the same manner as noted above for net income available to common stockholders per share.

Fair Value Measurements

Fair Value Measurements

The fair values of our financial assets and liabilities are disclosed in Note 19, “Fair Value Measurements and Disclosures,” to our consolidated financial statements. The only financial assets recorded at fair value on a recurring basis in our consolidated financial statements are our marketable securities. We elected not to apply the fair value option for any of our eligible financial instruments or other items.

We determine the estimated fair value of financial assets and liabilities utilizing a hierarchy of valuation techniques based on whether the inputs to a fair value measurement are considered to be observable or unobservable in a marketplace. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect our market assumptions. This hierarchy requires the use of observable market data when available. The following is the fair value hierarchy:

•Level 1 – quoted prices for identical instruments in active markets;

•Level 2 – quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and

•Level 3 – fair value measurements derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

We determine the fair value for the marketable securities using quoted prices in active markets for identical assets. Our other financial instruments, which are only disclosed at fair value, are comprised of secured debt, unsecured senior notes, unsecured line of credit and unsecured term loan facility.

We generally determine the fair value of our secured debt, unsecured debt, unsecured line of credit and unsecured term loan facility, prior to its repayment in August 2020, by performing discounted cash flow analyses using an appropriate market discount rate. We calculate the market rate by obtaining period-end treasury rates for maturities that correspond to the maturities of our fixed-rate debt and then adding an appropriate credit spread based on information obtained from third-party financial institutions. These credit spreads take into account factors, including but not limited to, our credit profile, the tenure of the debt, amortization period, whether the debt is secured or unsecured, and the loan-to-value ratio of the debt to the collateral. These calculations are significantly affected by the assumptions used, including the discount rate, credit spreads and estimates of future cash flow. We calculate the market rate of our unsecured line of credit and unsecured term loan facility by obtaining the period-end London Interbank Offered Rate (“LIBOR”) and then adding an appropriate credit spread based on our credit ratings, and the amended terms of our unsecured line of credit and unsecured term loan facility agreement. We determine the fair value of each of our publicly traded unsecured senior notes based on their quoted trading price at the end of the reporting period, if such prices are available.

Carrying amounts of our cash and cash equivalents, restricted cash and accounts payable approximate fair value due to their short-term maturities.

Income Taxes

Income Taxes

We have elected to be taxed as a REIT under Sections 856 through 860 of the Code. To qualify as a REIT, we must distribute annually at least 90% of our adjusted taxable income, as defined in the Code, to our stockholders and satisfy certain other organizational and operating requirements. We generally will not be subject to federal income taxes if we distribute 100% of our taxable income for each year to our stockholders. If we fail to qualify as a REIT in any taxable year, we will be subject to federal income taxes on our taxable income at regular corporate rates and we may not be able to qualify as a REIT for four subsequent taxable years. Even if we qualify for taxation as a REIT, we may be subject to certain state and local taxes on our income and property and to federal income taxes and excise taxes on our undistributed taxable income. We believe that we have met all of the REIT distribution and technical requirements for the years ended December 31, 2020, 2019 and 2018, and we were not subject to any federal income taxes (see Note 25 “Tax Treatment of Distributions” for additional information). We intend to continue to adhere to these requirements and maintain the Company’s REIT status. Accordingly, no provision for income taxes has been made in the accompanying financial statements.

In addition, any taxable income from our taxable REIT subsidiaries, which were formed in 2002, 2018, 2019 and 2020, are subject to federal, state, and local income taxes. For the years ended December 31, 2020, 2019 and 2018 the taxable REIT subsidiaries had de minimis taxable income.

Uncertain Tax Positions

Uncertain Tax Positions

We include favorable tax positions in the calculation of tax liabilities if it is more likely than not that our adopted tax position will prevail if challenged by tax authorities.

We evaluated the potential impact of identified uncertain tax positions for all tax years still subject to audit under state and federal income tax law and concluded that we did not have any unrecognized tax benefits or any additional tax liabilities as of December 31, 2020 or 2019. As of December 31, 2020, the years still subject to audit are 2016 through 2020 under the California state income tax law and 2017 through 2020 under the federal income tax law.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported periods. Actual results could differ from those estimates.

Segments

SegmentsWe currently operate in one operating segment, our office and life science properties segment.

Concentration of Credit Risk

Concentration of Credit RiskAll of our properties and development and redevelopment projects are owned and all of our business is currently conducted in the state of California with the exception of the ownership and operation of eight office properties, one development project in the tenant improvement phase and one future development project located in the state of Washington. The ability of tenants to honor the terms of their leases is dependent upon the economic, regulatory, and social factors affecting the communities in which our tenants operate.

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Organization and Ownership (Tables)

12 Months Ended

Dec. 31, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of real estate properties

Our stabilized portfolio of operating properties was comprised of the following properties at December 31, 2020:

	Number of Buildings	Rentable Square Feet (unaudited)	Number of Tenants	Percentage  Occupied (unaudited) (1)		Percentage Leased (unaudited)
Stabilized Office Properties (2)	117	14,620,166	447	91.2	%	94.3	%

_______________________

(1)Represents physical and economic occupancy.

(2)Includes stabilized life science and retail space.

	Number of Projects	Number of Units	2020 Average Occupancy (unaudited)
Stabilized Residential Properties	2	808	72.0	%

As of December 31, 2020, the following properties were excluded from our stabilized portfolio. We did not have any redevelopment properties or properties held for sale at December 31, 2020.

	Number of Properties/Projects	Estimated Rentable Square Feet (1) (unaudited)
In-process development projects - tenant improvement	3	1,080,000
In-process development projects - under construction (2)	3	856,000

____________________

(1)Estimated rentable square feet upon completion.

(2)In addition to the estimated office and life science rentable square feet noted above, development projects under construction also include 193 residential units.

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Basis of Presentation and Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2020

Basis of Presentation and Significant Accounting Policies [Abstract]

Buildings, improvements, and tenant improvements depreciation

The costs of buildings and improvements and tenant improvements are depreciated using the straight-line method of accounting over the estimated useful lives set forth in the table below. Depreciation expense for buildings and improvements for the three years ended December 31, 2020, 2019, and 2018 was $244.8 million, $211.9 million, and $198.6 million, respectively.

Asset Description	Depreciable Lives
Buildings and improvements	25 – 40 years
Tenant improvements	1 – 20 years (1)

____________________

(1)Tenant improvements are amortized over the shorter of the lease term or the estimated useful life.

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Acquisitions (Tables)

12 Months Ended

Dec. 31, 2020

Asset Acquisitions [Abstract]

Schedule of Acquisitions

During the year ended December 31, 2019, we acquired the 19-building creative office campus listed below in one transaction from an unrelated third party.

Property	Date of Acquisition	Number of Buildings	Rentable Square Feet (unaudited)	Purchase Price (in millions) (1)
2019 Acquisitions
3101-3243 La Cienega Boulevard, Culver City, CA (2)	October 15, 2019	19	151,908	$	186.0

________________________ 

(1)Excludes acquisition-related costs.

(2)The results of operations for the properties acquired during 2019 contributed $3.7 million to revenue and a net loss of $0.1 million for the year ended December 31, 2019 primarily due to a write-off of lease-related intangible assets as a result of an early lease termination during the year ended December 31, 2019.

During the year ended December 31, 2019, we acquired the following development sites in two transactions from unrelated third parties. The acquisitions were funded from various sources of liquidity including proceeds from the Company’s unsecured revolving credit facility, the issuance of debt and the settlement of the Company’s 2018 forward equity sale agreements.

Project	Date of Acquisition	City/Submarket	Purchase Price (in millions)
2019 Acquisitions
1335 Broadway & 901 Park Boulevard, San Diego, CA (1)	August 19, 2019	East Village	$	40.0
Seattle CBD Project (2)	December 12, 2019	Seattle CBD	133.0
Total 2019 Acquisitions			$	173.0

_______________________ 

(1)Excludes acquisition-related costs. In connection with this acquisition, we also recorded $4.0 million in accrued liabilities and environmental remediation liabilities at the date of acquisition, which are not included in the purchase price above. As of December 31, 2019, the purchase price and our current estimate of assumed liabilities are included in undeveloped land and construction in progress and the assumed liabilities are included in accounts payable, accrued expenses and other liabilities on the Company’s consolidated balance sheets.

(2)Excludes acquisition-related costs. In connection with this acquisition, we also recorded $6.3 million in accrued liabilities and environmental remediation liabilities at the date of acquisition, which are not included in the purchase price above. As of December 31, 2019, the purchase price and our current estimate of assumed liabilities are included in undeveloped land and construction in progress and the assumed liabilities are included in accounts payable, accrued expenses and other liabilities on the Company’s consolidated balance sheets. In addition, as of December 31, 2020 and 2019, the Company had $10.0 million in restricted cash, which is excluded from the purchase price above, related to this acquisition which may be payable to the seller only if certain events occur within three years following the date of acquisition.

Schedule of estimated fair values of the assets acquired and liabilities assumed

The related assets, liabilities and results of operations of the acquired properties are included in the consolidated financial statements as of the date of acquisition. The following table summarizes the estimated relative fair values of the assets and liabilities assumed at the acquisition date for our 2019 operating property acquisitions:

	Total 2019 Operating Property Acquisition (1)
Assets
Land and improvements	$	150,561
Buildings and improvements (2)	30,932
Deferred leasing costs and acquisition-related intangible assets (3)	12,063
Right of use ground lease asset (4)	13,334
Total assets acquired	$	206,890
Liabilities
Acquisition-related intangible liabilities (5)	$	9,950
Ground lease liability (4)	10,940
Total liabilities assumed	$	20,890
Net assets and liabilities acquired	$	186,000

________________________ 

(1)The purchase price of the acquisition completed during the year ended December 31, 2019 was less than 10% of the Company’s total assets as of December 31, 2018.

(2)Represents buildings, building improvements and tenant improvements.

(3)Represents in-place leases (approximately $9.2 million with a weighted average amortization period of 3.3 years) and leasing commissions (approximately $2.9 million with a weighted average amortization period of 3.5 years).

(4)We evaluated the ground lease assumed in connection with the 2019 operating property acquisition and concluded it met the criteria to be classified as an operating lease. The discount rate used in determining the present value of the minimum future lease payments was 4.79%. The right of use asset ground lease asset is equal to the ground lease liability adjusted for above and below market intangibles and deferred leasing costs. Refer to Note 18 “Commitments and Contingencies” for further discussion of the Company's ground lease obligations.

(5)Represents below-market leases (approximately $10.0 million with a weighted average amortization period of 3.5 years).

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Dispositions (Tables)

12 Months Ended

Dec. 31, 2020

Discontinued Operations and Disposal Groups [Abstract]

Schedule operating properties and land dispositions

The following table summarizes the operating properties sold during the years ended December 31, 2020, 2019 and 2018:

Location	Month of Disposition	Number of Buildings	Rentable Square Feet (unaudited)	Sales Price (in millions) (1)
2020 Dispositions
331 Fairchild Drive, Mountain View, CA	December	1	87,147	$	75.9
Total 2020 Dispositions		1	87,147	$	75.9
2019 Dispositions
2829 Townsgate Road, Thousand Oaks, CA	May	1	84,098	$	18.3
2211 Michelson Drive, Irvine, CA	October	1	271,556	115.5
Total 2019 Dispositions		2	355,654	$	133.8
2018 Dispositions
1310-1327 Chesapeake Terrace, Sunnyvale, CA	November	4	266,982	$	160.3
Plaza Yarrow Bay Properties (2)	November	4	279,924	134.5
23925, 23975, & 24025 Park Sorrento, Calabasas, CA	December	3	225,340	78.2
Total 2018 Dispositions		11	772,246	$	373.0

____________________

(1)Represents gross sales price before broker commissions and closing costs.

(2)The Plaza Yarrow Bay Properties include the following properties: 10210, 10220 and 10230 NE Points Drive & 3933 Lake Washington Boulevard NE in Kirkland, Washington.

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Deferred Leasing Costs and Acquisition-Related Intangible Assets and Liabilities, net (Tables)

12 Months Ended

Dec. 31, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Summary of identified deferred leasing costs and acquisition-related intangible assets

The following table summarizes our deferred leasing costs and acquisition-related intangible assets (acquired value of leasing costs, above-market operating leases, and in-place leases) and intangible liabilities (acquired value of below-market operating leases) as of December 31, 2020 and 2019:

	December 31, 2020		December 31, 2019
	(in thousands)
Deferred Leasing Costs and Acquisition-related Intangible Assets, net:
Deferred leasing costs	$	300,556	$	286,026
Accumulated amortization	(104,277)		(100,145)
Deferred leasing costs, net	196,279		185,881
Above-market operating leases	—		611
Accumulated amortization	—		(116)
Above-market operating leases, net	—		495
In-place leases	40,323		58,076
Accumulated amortization	(25,653)		(31,647)
In-place leases, net	14,670		26,429
Total deferred leasing costs and acquisition-related intangible assets, net	$	210,949	$	212,805
Acquisition-related Intangible Liabilities, net: (1)
Below-market operating leases	$	26,405	$	51,263
Accumulated amortization	(13,060)		(27,171)
Below-market operating leases, net	13,345		24,092
Total acquisition-related intangible liabilities, net	$	13,345	$	24,092

____________________

(1)Included in deferred revenue and acquisition-related intangible liabilities, net in the consolidated balance sheets.

Amortization for the period related to deferred leasing costs and acquisition-related intangibles

The following table sets forth amortization related to deferred leasing costs and acquisition-related intangibles for the years ended December 31, 2020, 2019 and 2018.

	Year Ended December 31,
	2020		2019		2018
	(in thousands)
Deferred leasing costs (1)	$	33,624	$	35,779	$	34,341
Above-market operating leases (2)	495		192		444
In-place leases (1)	11,759		18,615		15,915
Below-market ground lease obligation (3)	—		—		8
Below-market operating leases (4)	(10,748)		(9,398)		(10,192)
Above-market ground lease obligation (3)	—		—		(101)
Total	$	35,130	$	45,188	$	40,415

____________________

(1)    The amortization of deferred leasing costs and in-place leases is recorded to depreciation and amortization expense and the amortization of lease incentives is recorded as a reduction to rental income 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)    Upon adoption of Topic 842 on January 1, 2019 (refer to Note 2 “Basis of Presentation and Significant Accounting Policies”), we no longer separately recognize above or below-market ground lease obligations. Refer to Note 18 “Commitments and Contingencies” for further discussion of our ground lease obligations.

(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.

Estimated annual amortization related to deferred leasing costs and acquisition-related intangibles

The following table sets forth the estimated annual amortization expense related to deferred leasing costs and acquisition-related intangibles as of December 31, 2020 for future periods:

Year	Deferred Leasing Costs		In-Place Leases		Below-Market Operating Leases (1)
	(in thousands)
2021	$	31,048	$	6,531	$	(4,152)
2022	28,334		3,885		(3,167)
2023	24,470		1,534		(1,486)
2024	21,545		584		(812)
2025	19,726		473		(710)
Thereafter	71,156		1,663		(3,018)
Total	$	196,279	$	14,670	$	(13,345)

____________________

(1)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.

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Receivables (Tables)

12 Months Ended

Dec. 31, 2020

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 December 31, 2020 and 2019:

	December 31, 2020		December 31, 2019
	(in thousands)
Current receivables	$	13,806	$	27,660
Allowance for uncollectible tenant receivables (1)	(1,799)		(1,171)
Current receivables, net	$	12,007	$	26,489

____________________

(1)Refer to Note 2 “Basis of Presentation and Significant Accounting Policies” for discussion of our accounting policies related to the allowance for uncollectible tenant receivables for additional information regarding changes in our allowance for uncollectible tenant receivables.

Deferred rent receivables, net

Deferred rent receivables, net consisted of the following as of December 31, 2020 and 2019:

	December 31, 2020		December 31, 2019
	(in thousands)
Deferred rent receivables	$	387,462	$	339,489
Allowance for deferred rent receivables (1)	(804)		(1,552)
Deferred rent receivables, net	$	386,658	$	337,937

____________________

(1)Refer to Note 2 “Basis of Presentation and Significant Accounting Policies” for discussion of our accounting policies related to the allowance for deferred rent receivables for additional information regarding changes in our allowance for deferred rent receivables.

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Prepaid Expenses and Other Assets, Net (Tables)

12 Months Ended

Dec. 31, 2020

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Prepaid expenses and other assets, net

Prepaid expenses and other assets, net consisted of the following at December 31, 2020 and 2019:

	December 31, 2020		December 31, 2019
	(in thousands)
Furniture, fixtures and other long-lived assets, net	$	43,367	$	35,286
Prepaid expenses	10,193		18,724
Notes receivable, net (1)	—		1,651
Total prepaid expenses and other assets, net	$	53,560	$	55,661

____________________

(1)During the year ended December 31, 2020, the balance of the note receivable was written-off and the note receivable was placed on non-accrual status. We do not recognize interest income on non-accrual financing receivables. As of December 31, 2019, the note receivable was shown net of a valuation allowance of approximately $3.6 million.

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Secured and Unsecured Debt of the Operating Partnership (Tables) - Kilroy Realty L.P. [Member]

12 Months Ended

Dec. 31, 2020

Debt Instrument [Line Items]

Unsecured revolving credit facility

The following table summarizes the balance and terms of our unsecured revolving credit facility as of December 31, 2020 and 2019:

	December 31, 2020			December 31, 2019
	(in thousands)
Outstanding borrowings	$	—		$	245,000
Remaining borrowing capacity	750,000			505,000
Total borrowing capacity (1)	$	750,000		$	750,000
Interest rate (2)	1.14		%	2.76		%
Facility fee-annual rate (3)	0.200%
Maturity date	July 2022

____________________

(1)We may elect to borrow, subject to bank approval and obtaining commitments for any additional borrowing capacity, up to an additional $600.0 million under an accordion feature under the terms of the unsecured revolving credit facility and unsecured term loan facility.

(2)Our unsecured revolving credit facility interest rate was calculated based on the contractual rate of LIBOR plus 1.000% as of December 31, 2020 and 2019.

(3)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 December 31, 2020 and 2019, $2.1 million and $3.4 million of unamortized deferred financing costs, respectively, which are included in prepaid expenses and other assets, net on our consolidated balance sheets, remained to be amortized through the maturity date of our unsecured revolving credit facility. The following table summarizes the balance and terms of our unsecured term loan facility as of December 31, 2019, which is included in unsecured debt, net on our consolidated balance sheets:

	December 31, 2019
Outstanding borrowings	$	150,000
Remaining borrowing capacity	—
Total borrowing capacity (1)	$	150,000
Interest rate (2)	2.85		%
Undrawn facility fee-annual rate	0.200%
Maturity date	July 2022

____________________

(1)As of December 31, 2019, $0.7 million of unamortized deferred financing costs 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 the contractual rate of LIBOR plus 1.100% as of December 31, 2019.

Schedule of debt maturities

The following table summarizes the stated debt maturities and scheduled amortization payments as of December 31, 2020:

Year	(in thousands)
2021	$	5,342
2022	5,554
2023	305,775
2024	431,006
2025	406,246
Thereafter	2,800,442
Total aggregate principal value (1)	$	3,954,365

________________________ 

(1)     Includes gross principal balance of outstanding debt before the effect of the following at December 31, 2020: $22.4 million of unamortized deferred financing costs for the unsecured senior notes and secured debt and $8.3 million of unamortized discounts for the unsecured senior notes.

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 years ended December 31, 2020, 2019 and 2018. The interest expense capitalized was recorded as a cost of development and increased the carrying value of undeveloped land and construction in progress.

	Year Ended December 31,
	2020		2019		2018
	(in thousands)
Gross interest expense	$	150,325	$	129,778	$	117,789
Capitalized interest and deferred financing costs	(79,553)		(81,241)		(68,068)
Interest expense	$	70,772	$	48,537	$	49,721

Secured debt [Member]

Debt Instrument [Line Items]

Debt balance and significant terms

The following table sets forth the composition of our secured debt as of December 31, 2020 and 2019:

	Annual Stated Interest Rate (1)	GAAP Effective Rate (1)(2)	Maturity Date	December 31,
Type of Debt				2020		2019
				(in thousands)
Mortgage note payable	3.57%	3.57%	December 2026	$	166,776	$	170,000
Mortgage note payable (3)	4.48%	4.48%	July 2027	87,589		89,502
Total secured debt				$	254,365	$	259,502
Unamortized Deferred Financing Costs				(783)		(909)
Total secured debt, net				$	253,582	$	258,593

____________________

(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)The secured debt and the related properties that secure this 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.

Unsecured senior notes [Member]

Debt Instrument [Line Items]

Debt balance and significant terms

The following table summarizes the balance and significant terms of the registered unsecured senior notes issued by the Operating Partnership and outstanding, including the issuances noted above, and including unamortized discounts of $8.3 million and $6.5 million and unamortized deferred financing costs of $21.6 million and $18.7 million as of December 31, 2020 and 2019, respectively:

					Net Carrying Amount as of December 31,
	Issuance date	Maturity date	Stated coupon rate	Effective interest rate (1)	2020		2019
					(in thousands)
2.500% Unsecured Senior Notes (2)	August 2020	November 2032	2.500%	2.560%	$	425,000	$	—
Unamortized discount and deferred financing costs					(6,332)		—
Net carrying amount					$	418,668	$	—
4.270% Unsecured Senior Notes (3)	April 2020	January 2031	4.270%	4.270%	$	350,000	$	—
Unamortized discount and deferred financing costs					(1,825)		—
Net carrying amount					$	348,175	$	—
3.050% Unsecured Senior Notes (4)	September 2019	February 2030	3.050%	3.064%	$	500,000	$	500,000
Unamortized discount and deferred financing costs					(5,399)		(5,998)
Net carrying amount					$	494,601	$	494,002
4.750% Unsecured Senior Notes (5)	November 2018	December 2028	4.750%	4.800%	$	400,000	$	400,000
Unamortized discount and deferred financing costs					(3,952)		(4,446)
Net carrying amount					$	396,048	$	395,554
4.350% Unsecured Senior Notes (6)	October 2018	October 2026	4.350%	4.350%	$	200,000	$	200,000
Unamortized discount and deferred financing costs					(1,012)		(1,186)
Net carrying amount					$	198,988	$	198,814
4.300% Unsecured Senior Notes (6)	July 2018	July 2026	4.300%	4.300%	$	50,000	$	50,000
Unamortized discount and deferred financing costs					(246)		(290)
Net carrying amount					$	49,754	$	49,710
3.450% Unsecured Senior Notes (7)	December 2017	December 2024	3.450%	3.470%	$	425,000	$	425,000
Unamortized discount and deferred financing costs					(2,321)		(2,907)
Net carrying amount					$	422,679	$	422,093
3.450% Unsecured Senior Notes (8)	February 2017	February 2029	3.450%	3.450%	$	75,000	$	75,000
Unamortized discount and deferred financing costs					(347)		(390)
Net carrying amount					$	74,653	$	74,610
3.350% Unsecured Senior Notes (8)	February 2017	February 2027	3.350%	3.350%	$	175,000	$	175,000
Unamortized discount and deferred financing costs					(709)		(825)
Net carrying amount					$	174,291	$	174,175
4.375% Unsecured Senior Notes (9)	September 2015	October 2025	4.375%	4.444%	$	400,000	$	400,000
Unamortized discount and deferred financing costs					(2,631)		(3,185)
Net carrying amount					$	397,369	$	396,815
4.250% Unsecured Senior Notes (10)	July 2014	August 2029	4.250%	4.350%	$	400,000	$	400,000
Unamortized discount and deferred financing costs					(4,567)		(5,100)
Net carrying amount					$	395,433	$	394,900
3.800% Unsecured Senior Notes (11)	January 2013	January 2023	3.800%	3.800%	$	300,000	$	300,000
Unamortized discount and deferred financing costs					(560)		(834)
Net carrying amount					$	299,440	$	299,166
Total Unsecured Senior Notes, Net					$	3,670,099	$	2,899,839

____________________

(1)Represents the effective interest rate including the amortization of initial issuance discounts, excluding the amortization of deferred financing costs.

(2)Interest on these notes is payable semi-annually in arrears on May 15 and November 15 of each year.

(3)Interest on these notes is payable semi-annually in arrears on April 18 and October 18 of each year.

(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 June 15th and December 15th of each year.

(6)Interest on these notes is payable semi-annually in arrears on April 18th and October 18th of each year.

(7)Interest on these notes is payable semi-annually in arrears on June 15th and December 15th of each year.

(8)Interest on these notes is payable semi-annually in arrears on February 17th and August 17th of each year.

(9)Interest on these notes is payable semi-annually in arrears on April 1st and October 1st of each year.

(10)Interest on these notes is payable semi-annually in arrears on February 15th and August 15th of each year.

(11)Interest on these notes is payable semi-annually in arrears on January 15th and July 15th of each year.

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Deferred Revenue and Acquisition-Related Intangible Liabilities, net (Tables)

12 Months Ended

Dec. 31, 2020

Revenue from Contract with Customer [Abstract]

Deferred revenue and acquisition-related liabilities

Deferred revenue and acquisition-related intangible liabilities, net consisted of the following at December 31, 2020 and 2019:

	December 31,
	2020		2019
	(in thousands)
Deferred revenue related to tenant-funded tenant improvements	$	88,645	$	96,271
Other deferred revenue	26,533		19,125
Acquisition-related intangible liabilities, net (1)	13,345		24,092
Total	$	128,523	$139,488

_____________________

(1)See Note 5 “Deferred Leasing Costs and Acquisition-Related Intangible Assets and Liabilities, net” for additional information regarding our acquisition-related intangible liabilities.

Estimated amortization of deferred revenue related to tenant-funded improvements

The following is the estimated amortization of deferred revenue related to tenant-funded tenant improvements as of December 31, 2020 for the next five years and thereafter:

Year Ending	(in thousands)
2021	$	16,216
2022	15,188
2023	13,367
2024	11,325
2025	8,564
Thereafter	23,985
Total	$	88,645

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Stockholders' Equity of the Company (Tables)

12 Months Ended

Dec. 31, 2020

Equity [Abstract]

Schedule of common stock sales under the at-the-market offering

The following table sets forth information regarding settlements of forward equity sale agreements under our at-the-market offering program for the year ended December 31, 2020:

	Year Ended December 31, 2020
	(in millions, except share and per share data)
Shares of common stock settled during the period	3,147,110
Weighted average price per share of common stock	$	80.08
Aggregate gross proceeds	$	252.0
Aggregate net proceeds after selling commissions	$	247.3

The following table sets forth information regarding direct sales of our common stock under our at-the-market offering programs for the year ended December 31, 2018:

	Year Ended December 31, 2018
	(in millions, except share and per share data)
Shares of common stock sold during the period		1,817,195
Weighted average price per share of common stock		$	73.64
Aggregate gross proceeds		$	133.8
Aggregate net proceeds after selling commissions		$	132.1

Schedule of accrued dividends and distributions

The following tables summarize accrued dividends and distributions for the noted outstanding shares of common stock and noncontrolling units as of December 31, 2020 and 2019:

	December 31,
	2020		2019
	(in thousands)
Dividends and Distributions payable to:
Common stockholders	$	58,018	$	51,418
Noncontrolling common unitholders of the Operating Partnership	575		981
RSU holders (1)	838		820
Total accrued dividends and distribution to common stockholders and noncontrolling unitholders	$	59,431	$	53,219

_____________________

(1)The amount includes the value of the dividend equivalents that will be paid with additional RSUs (see Note 15 “Share-Based and Other Compensation” for additional information).

Schedule of outstanding shares of common stock, preferred stock and noncontrolling units

	December 31,
	2020	2019
Outstanding Shares and Units:
Common stock (1)	116,035,827	106,016,287
Noncontrolling common units	1,150,574	2,023,287
RSUs (2)	1,638,026	1,651,905

_____________________

(1)The amount includes nonvested shares.

(2)The amount includes nonvested RSUs. Does not include 873,709 and 932,675 market measure-based RSUs because not all the necessary performance conditions have been met as of December 31, 2020 and 2019, respectively. Refer to Note 15 “Share-Based and Other Compensation” for additional information.

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Partners' Capital of the Operating Partnership (Tables)

12 Months Ended

Dec. 31, 2020

Class of Stock [Line Items]

Schedule of common stock sales under the at-the-market offering

The following table sets forth information regarding settlements of forward equity sale agreements under our at-the-market offering program for the year ended December 31, 2020:

	Year Ended December 31, 2020
	(in millions, except share and per share data)
Shares of common stock settled during the period	3,147,110
Weighted average price per share of common stock	$	80.08
Aggregate gross proceeds	$	252.0
Aggregate net proceeds after selling commissions	$	247.3

The following table sets forth information regarding direct sales of our common stock under our at-the-market offering programs for the year ended December 31, 2018:

	Year Ended December 31, 2018
	(in millions, except share and per share data)
Shares of common stock sold during the period		1,817,195
Weighted average price per share of common stock		$	73.64
Aggregate gross proceeds		$	133.8
Aggregate net proceeds after selling commissions		$	132.1

Schedule of accrued dividends and distributions

The following tables summarize accrued dividends and distributions for the noted outstanding shares of common stock and noncontrolling units as of December 31, 2020 and 2019:

	December 31,
	2020		2019
	(in thousands)
Dividends and Distributions payable to:
Common stockholders	$	58,018	$	51,418
Noncontrolling common unitholders of the Operating Partnership	575		981
RSU holders (1)	838		820
Total accrued dividends and distribution to common stockholders and noncontrolling unitholders	$	59,431	$	53,219

_____________________

(1)The amount includes the value of the dividend equivalents that will be paid with additional RSUs (see Note 15 “Share-Based and Other Compensation” for additional information).

Schedule of outstanding shares of common stock, preferred stock and noncontrolling units

	December 31,
	2020	2019
Outstanding Shares and Units:
Common stock (1)	116,035,827	106,016,287
Noncontrolling common units	1,150,574	2,023,287
RSUs (2)	1,638,026	1,651,905

_____________________

(1)The amount includes nonvested shares.

(2)The amount includes nonvested RSUs. Does not include 873,709 and 932,675 market measure-based RSUs because not all the necessary performance conditions have been met as of December 31, 2020 and 2019, respectively. Refer to Note 15 “Share-Based and Other Compensation” for additional information.

Kilroy Realty L.P. [Member]

Class of Stock [Line Items]

Schedule of common stock sales under the at-the-market offering

During the year ended December 31, 2018, the Company utilized its at-the-market stock offering programs to issue shares of common stock. See Note 13 “Stockholders’ Equity of the Company” for additional information. The net

offering proceeds contributed by the Company to the Operating Partnership in exchange for common units for the year ended December 31, 2020 and 2018 are as follows:

	Year Ended December 31,
	2020		2018
	(in millions except share and per share data)
Shares of common stock contributed by the Company	3,147,110		1,817,195
Common units exchanged for shares of common stock by the Company	3,147,110		1,817,195
Aggregate gross proceeds	$	252.0	$	133.8
Aggregate net proceeds after selling commissions	$	247.3	$	132.1

Redeemable noncontrolling interest

The following table sets forth the number of common units held by the Company and the number of common units held by non-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:

	December 31, 2020		December 31, 2019
Company owned common units in the Operating Partnership	116,035,827		106,016,287
Company owned general partnership interest	99.0	%	98.1	%
Noncontrolling common units of the Operating Partnership	1,150,574		2,023,287
Ownership interest of noncontrolling interest	1.0	%	1.9	%

Schedule of accrued dividends and distributions

The following tables summarize accrued distributions for the noted common units as of December 31, 2020 and 2019:

	December 31, 2020		December 31, 2019
	(in thousands)
Distributions payable to:
General partner	$	58,018	$	51,418
Common limited partners	575		981
RSU holders (1)	838		820
Total accrued distributions to common unitholders	$	59,431	$	53,219

_____________________

(1)The amount includes the value of the dividend equivalents that will be paid with additional RSUs (see Note 15 “Share-Based and Other Compensation” for additional information).

Schedule of outstanding shares of common stock, preferred stock and noncontrolling units

	December 31, 2020	December 31, 2019
Outstanding Units:
Common units held by the general partner	116,035,827	106,016,287
Common units held by the limited partners	1,150,574	2,023,287
RSUs (1)	1,638,026	1,651,905

_____________________

(1)Does not include 873,709 and 932,675 market measure-based RSUs because not all the necessary performance conditions have been met as of December 31, 2020 and 2019, respectively. Refer to Note 15 “Share-Based and Other Compensation” for additional information.

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Share-Based and Other Compensation (Tables)

12 Months Ended

Dec. 31, 2020

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Schedule of Restricted Stock Units Valuation Assumptions

As of December 31, 2020, the estimated number of RSUs earned for the 2020 and 2019 Performance-Based RSUs and the actual number of RSUs earned for the 2018 Performance-Based RSUs was as follows:

	2020 Performance-Based RSUs	2019 Performance-Based RSUs	2018 Performance-Based RSUs
Service vesting period	January 31, 2020 - January, 2023	February 1, 2019 - January, 2022	February 14, 2018 - January, 2021
Target RSUs granted	154,267	143,396	158,205
Estimated RSUs earned (1)	142,004	220,151	229,748
Date of valuation	January 31, 2020	February 1, 2019	February 14, 2018

_____________________

(1)Estimated RSUs earned for the 2020 Performance-Based RSUs are based on the actual achievement of the 2020 FFO Performance Condition and for the 2020 Debt to EBITDA Ratio Performance Condition, assumes 100% of the target level of achievement for all participants, and target level of achievement of the 2020 Market Condition. Estimated RSUs earned for the 2019 Performance-Based RSUs are based on the actual achievement of the 2019 FFO Performance Condition and assume target level achievement of the 2019 Market Condition and maximum level of achievement of the 2019 Debt to EBITDA Ratio Performance Condition. The 2018 Performance-Based RSUs earned are based on actual performance of the 2018 Performance Conditions and the 2018 Market Condition.The total fair value of the Time-Based RSUs is based on the Company's closing share price on the NYSE on the respective fair valuation dates as detailed in the table below:

	2020 Time-Based RSU Grant		2019 Time-Based RSU Grant		December 2018 Time-Based RSU Grant		2018 Time-Based RSU Grant (1)
Service vesting period	January 31, 2020 - January 5, 2023		February 1, 2019 - January 5, 2022		December 27, 2018 - January 5, 2023		January & February 2018 - January 5, 2021
Fair value on valuation date (in millions)	$	9.0	$	10.1	$	18.5	$	8.4
Fair value per share	$	82.57	$	69.89	$	62.00	$	70.37
Date of fair valuation	January 31, 2020		February 1, 2019		December 27, 2018		January & February 2018

____________________

(1)The 2018 Time-Based RSUs consist of 56,015 RSUs granted on January 29, 2018 at a fair value per share of $70.37 and 67,818 RSUs granted on February 14, 2018 at a fair value per share of $66.46.

Summary of Nonvested Restricted Stock

A summary of our nonvested and vested restricted stock activity for the year ended December 31, 2018 is presented below:

	Shares Granted		Shares Vested
Years ended December 31,	Nonvested Shares Issued	Weighted-Average Grant Date Fair Value Per Share	Vested Shares	Total Fair Value at Vest Date (1) (in thousands)
2018	—	—	(22,884)	1,652

_______________________

(1)    Total fair value of shares vested was calculated based on the quoted closing share price of the Company’s common stock on the NYSE on the date of vesting.

Summary of Nonvested and Vested Restricted Stock Activity

A summary of our nonvested and vested restricted stock activity for the year ended December 31, 2018 is presented below:

	Shares Granted		Shares Vested
Years ended December 31,	Nonvested Shares Issued	Weighted-Average Grant Date Fair Value Per Share	Vested Shares	Total Fair Value at Vest Date (1) (in thousands)
2018	—	—	(22,884)	1,652

_______________________

(1)    Total fair value of shares vested was calculated based on the quoted closing share price of the Company’s common stock on the NYSE on the date of vesting.

December 2018 Market-Based RSUs [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Assumptions Utilized in the Monte Carlo Simulation Pricing Models

The following table summarizes the assumptions utilized in the Monte Carlo simulation pricing models:

	December 2018 Market-Based RSU Award Fair Value Assumptions
Valuation date	December 27, 2018
Fair value per share on valuation date	$68.66
Expected share price volatility	23.0%
Risk-free interest rate	2.4%

Market measure-based Restricted Stock Units (RSUs) [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Summary of Restricted Stock Units Award Activity

A summary of our performance and market-measure based RSU activity from January 1, 2020 through December 31, 2020 is presented below:

	Nonvested RSUs			Vested RSUs	Total RSUs
	Amount	Weighted-Average Fair Value Per Share
Outstanding at January 1, 2020	932,675	$	71.04	36,679	969,354
Granted	154,267	85.08		38,313	192,580
Vested	(230,334)	74.71		230,334	—
Settled (1)	—	—		(259,954)	(259,954)
Issuance of dividend equivalents (2)	29,561	62.21		1,407	30,968
Forfeited	(12,460)	84.54		(4)	(12,464)
Outstanding as of December 31, 2020 (3)	873,709	$	72.06	46,775	920,484

____________________

(1)Represents vested RSUs that were settled in shares of the Company’s common stock. Total shares settled include 125,928 shares that were tendered in accordance with the terms of the 2006 Plan to satisfy minimum statutory tax withholding requirements related to the RSUs settled. We accept the return of RSUs at the current quoted closing share price of the Company’s common stock to satisfy tax obligations.

(2)Represents the issuance of dividend equivalents earned on the underlying RSUs. The dividend equivalents vest based on terms specified under the related RSU award agreement.

(3)Outstanding RSUs as of December 31, 2020 represent the actual achievement of the FFO performance conditions and assumes target levels for the market and other performance conditions. The number of restricted stock units ultimately earned is subject to change based upon actual performance over the three-year vesting period. Dividend equivalents earned will vest along with the underlying award and are also subject to changes based on the number of RSUs ultimately earned for each underlying award.

A summary of our performance and market-measure based RSU activity for the years ended December 31, 2020, 2019 and 2018 is presented below:

	RSUs Granted			RSUs Vested
Years ended December 31,	Non-Vested RSUs Granted (1)	Weighted-Average Fair Value Per Share		Vested RSUs	Total Vest-Date Fair Value (in thousands)
2020	154,267	$	85.08	(270,054)	$	19,471
2019	231,191	71.12		(265,737)	18,703
2018	601,012	68.51		(265,918)	18,906

____________________

(1)Non-vested RSUs granted are based on the actual achievement of the FFO performance conditions and assumes target level achievement for the market and other performance conditions.

Time-Based Restricted Stock Units (RSUs) [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Summary of Restricted Stock Units Award Activity

A summary of our time-based RSU activity from January 1, 2020 through December 31, 2020 is presented below:

	Nonvested RSUs			Vested RSUs	Total RSUs
	Amount	Weighted Average Fair Value Per Share
Outstanding at January 1, 2020	543,848	$	66.66	1,071,378	1,615,226
Granted	120,769	79.74		—	120,769
Vested	(173,796)	70.83		173,796	—
Settled (1)				(181,462)	(181,462)
Issuance of dividend equivalents (2)	15,523	61.80		34,812	50,335
Forfeited	(11,979)	77.58		—	(11,979)
Canceled (3)				(1,638)	(1,638)
Outstanding as of December 31, 2020	494,365	$	67.97	1,096,886	1,591,251

____________________

(1)Represents vested RSUs that were settled in shares of the Company’s common stock. Total shares settled include 67,316 shares that were tendered in accordance with the terms of the 2006 Plan to satisfy minimum statutory tax withholding requirements related to the RSUs settled. We accept the return of RSUs at the current quoted closing share price of the Company’s common stock to satisfy tax obligations.

(2)Represents the issuance of dividend equivalents earned on the underlying RSUs. The dividend equivalents vest based on terms specified under the related RSU award agreement.

(3)For shares vested but not yet settled, we accept the return of RSUs at the current quoted closing share price of the Company’s common stock to satisfy minimum statutory tax-withholding requirements related to either the settlement or vesting of RSUs in accordance with the terms of the 2006 Plan.

A summary of our time-based RSU activity for the years ended December 31, 2020, 2019 and 2018 is presented below:

	RSUs Granted			RSUs Vested
Year ended December 31,	Non-Vested RSUs Issued	Weighted-Average Grant Date Fair Value Per Share		Vested RSUs	Total Vest-Date Fair Value (1) (in thousands)
2020	120,769	$	79.74	(208,608)	$	15,066
2019	153,005	70.31		(182,219)	12,227
2018	437,216	64.21		(214,131)	14,768

____________________

(1)    Total fair value of RSUs vested was calculated based on the quoted closing share price of the Company’s common stock on the NYSE on the day of vesting. Excludes the issuance of dividend equivalents earned on the underlying RSUs. The dividend equivalents vest based on terms specified under the related RSU award agreement.

2020, 2019, and 2018 Performance-Based RSUs [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Assumptions Utilized in the Monte Carlo Simulation Pricing Models

The following table summarizes the assumptions utilized in the Monte Carlo simulation pricing models:

	2020 Award Fair Value Assumptions	2019 Award Fair Value Assumptions	2018 Award Fair Value Assumptions
Valuation date	January 31, 2020	February 1, 2019	February 14, 2018
Fair value per share on valuation date	$84.54	$72.57	$70.08
Expected share price volatility	17.0%	19.0%	20.0%
Risk-free interest rate	1.35%	2.48%	2.37%

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Rental Income and Future Minimum Rent (Tables)

12 Months Ended

Dec. 31, 2020

Leases [Abstract]

Schedule of allocation of rental income between fixed and variable payments

The table below sets forth the allocation of rental income between fixed and variable payments and net collectability reversals or recoveries for the years ended December 31, 2020 and 2019:

	Year Ended December 31,
	2020		2019
Fixed lease payments	$	786,860	$	708,362
Variable lease payments	124,443		115,915
Net collectability (reversals) recoveries (1)	(18,997)		2,195
Total rental income	$	892,306	$	826,472

____________________

(1)Represents adjustments to rental income related to our assessment of the collectability of amounts due under leases with our tenants. For the year ended December 31, 2020, includes $18.4 million of write-offs related to the cumulative impact of transitioning certain tenants to a cash basis of reporting primarily as a result of the COVID-19 pandemic. Also includes a $0.6 million net increase to the allowance for doubtful accounts, which includes the impact of $2.2 million of reversals to the allowance for doubtful account for tenants that had an allowance at January 1, 2020 and were subsequently transitioned to a cash basis of reporting during 2020. These reversals are included in the $18.4 million of write-offs above.

Future contractual minimum rent under operating lease

Future

contractual minimum rent under operating leases, which includes amounts contractually due from leases that are on a cash basis of reporting due to creditworthiness considerations, as of December 31, 2020 for future periods is summarized as follows:

Year Ending	(in thousands)
2021	$	731,169
2022	804,488
2023	788,214
2024	750,051
2025	719,274
Thereafter	3,455,201
Total (1)	$	7,248,397

____________________

(1)Excludes residential leases and leases with a term of one year or less.

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Commitments and Contingencies (Tables)

12 Months Ended

Dec. 31, 2020

Commitments and Contingencies Disclosure [Abstract]

Schedule of contractual expiration dates for ground leases

The following table summarizes our properties that are held subject to long-term noncancellable ground lease obligations and the respective contractual expiration dates:

Property	Contractual Expiration Date (1)
601 108th Ave NE, Bellevue, WA	November 2093
701, 801 and 837 N. 34th Street, Seattle, WA (2)	December 2041
1701 Page Mill Road and 3150 Porter Drive, Palo Alto, CA	December 2067
Kilroy Airport Center Phases I, II, and III, Long Beach, CA	July 2084
3243 S. La Cienega Boulevard, Los Angeles, CA (3)	October 2106

____________________

(1)    Reflects the contractual expiration date prior to the impact of any extension or purchase options held by the Company.

(2)    The Company has three 10-year and one 45-year extension options for this ground lease, which if exercised would extend the expiration date to December 2116. These extension options are not assumed to be exercised in our calculation of the present value of the future minimum lease payments for this lease.

(3)    We entered into this ground lease in connection with an operating property acquisition in 2019. Refer to Note 3 “Acquisitions” for additional information.

Schedule of minimum commitment under ground leases

The minimum commitment under our ground leases as of December 31, 2020 for future periods is as follows:

Year Ending	(in thousands)
2021	$	5,641
2022	5,642
2023	5,662
2024	5,662
2025	5,662
Thereafter	280,723
Total undiscounted cash flows (1)(2)(3)(4)(5)(6)	$	308,992
Present value discount	(211,214)
Ground lease liabilities	$	97,778

________________________

(1)Excludes contingent future rent payments based on gross income or adjusted gross income and reflects the minimum ground lease obligations before the impact of ground lease extension options.

(2)    One of our ground lease obligations is subject to a fair market value adjustment every five years; however, the lease includes ground rent subprotection and infrastructure rent credits which currently limit our annual rental obligations to $1.0 million. The contractual obligations for that ground lease included above assumes the lesser of $1.0 million or annual lease rental obligation in effect as of December 31, 2020.

(3)    One of our ground lease obligations includes a component which is based on the percentage of gross income that exceeds the minimum ground rent. The minimum rent is subject to increases every five years based on 50% of the average annual percentage rent for the previous five years. The contractual obligations for that lease included above assume the current annual ground lease obligation in effect at December 31, 2020 for the remainder of the lease term since we cannot predict future adjustments.

(4)    One of our ground lease obligations is subject to a fair market value adjustment every five years based on a combination of CPI adjustments and third-party appraisals limited to maximum increases annually. The contractual obligations for that lease included above assume the current annual ground lease obligation in effect at December 31, 2020 for the remainder of the lease term since we cannot predict future adjustments.

(5)    One of our ground lease obligations includes a component which is based on the percentage of adjusted gross income that exceeds the minimum ground rent. The minimum rent is subject to increases every 10 years by an amount equal to 60% of the average annual percentage rent for the previous three years. The contractual obligations for this lease included above assume the current annual ground lease obligation in effect at December 31, 2020 for the remainder of the lease term since we cannot predict future adjustments.

(6)    One of our ground lease obligations is subject to fixed 5% ground rent increases every five years, with the next increase occurring on December 1, 2022.

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Fair Value Measurements and Disclosures (Tables)

12 Months Ended

Dec. 31, 2020

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 December 31, 2020 and 2019:

	Fair Value (Level 1) (1)
	2020		2019
Description	(in thousands)
Marketable securities (2)	$	27,481	$	27,098

____________________

(1)Based on quoted prices in active markets for identical securities.

(2)The marketable securities are held in a limited rabbi trust.

Net (loss) gain on marketable securities

The following table sets forth the net gain (loss) on marketable securities recorded during the years ended December 31, 2020, 2019 and 2018:

	December 31,
	2020		2019		2018
Description	(in thousands)
Net gain (loss) on marketable securities	$	2,864	$	3,885	$	(1,851)

Carrying value and fair value of other financial instruments

The following table sets forth the carrying value and the fair value of our other financial instruments as of December 31, 2020 and 2019: 

	December 31,
	2020				2019
	Carrying Value		Fair Value (1)		Carrying Value		Fair Value (1)
	(in thousands)
Liabilities
Secured debt, net	$	253,582	$	282,559	$	258,593	$	272,997
Unsecured debt, net	3,670,099		4,089,339		3,049,185		3,252,217
Unsecured line of credit	—		—		245,000		245,195

_______________

(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.

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Net Income Available to Common Stockholders Per Share of the Company (Tables)

12 Months Ended

Dec. 31, 2020

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 years ended December 31, 2020, 2019 and 2018:

	Year Ended December 31,
	2020		2019		2018
	(in thousands, except unit and per unit amounts)
Numerator:
Net income attributable to common stockholders	$	187,105	$	195,443	$	258,415
Allocation to participating securities (1)	(2,229)		(2,119)		(2,004)
Numerator for basic and diluted net income available to common stockholders	$	184,876	$	193,324	$	256,411
Denominator:
Basic weighted average vested shares outstanding	113,241,341		103,200,568		99,972,359
Effect of dilutive securities	478,281		648,600		510,006
Diluted weighted average vested shares and common stock equivalents outstanding	113,719,622		103,849,168		100,482,365
Basic earnings per share:
Net income available to common stockholders per share	$	1.63	$	1.87	$	2.56
Diluted earnings per share:
Net income available to common stockholders per share	$	1.63	$	1.86	$	2.55

_____________________ 

(1)Participating securities include nonvested shares, certain time-based RSUs and vested market measure-based RSUs.

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Net Income Available to Common Unitholders Per Unit of the Operating Partnership (Tables)

12 Months Ended

Dec. 31, 2020

Net Income Available To Common Unitholders [Line Items]

Net income available to common unitholders

The following table reconciles the numerator and denominator in computing the Company’s basic and diluted per-share computations for net income available to common stockholders for the years ended December 31, 2020, 2019 and 2018:

	Year Ended December 31,
	2020		2019		2018
	(in thousands, except unit and per unit amounts)
Numerator:
Net income attributable to common stockholders	$	187,105	$	195,443	$	258,415
Allocation to participating securities (1)	(2,229)		(2,119)		(2,004)
Numerator for basic and diluted net income available to common stockholders	$	184,876	$	193,324	$	256,411
Denominator:
Basic weighted average vested shares outstanding	113,241,341		103,200,568		99,972,359
Effect of dilutive securities	478,281		648,600		510,006
Diluted weighted average vested shares and common stock equivalents outstanding	113,719,622		103,849,168		100,482,365
Basic earnings per share:
Net income available to common stockholders per share	$	1.63	$	1.87	$	2.56
Diluted earnings per share:
Net income available to common stockholders per share	$	1.63	$	1.86	$	2.55

_____________________ 

(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 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 years ended December 31, 2020, 2019 and 2018:

	Year Ended December 31,
	2020		2019		2018
	(in thousands, except unit and per unit amounts)
Numerator:
Net income attributable to common unitholders	$	189,609	$	198,738	$	263,210
Allocation to participating securities (1)	(2,229)		(2,119)		(2,004)
Numerator for basic and diluted net income available to common unitholders	$	187,380	$	196,619	$	261,206
Denominator:
Basic weighted average vested units outstanding	115,095,506		105,223,975		102,025,276
Effect of dilutive securities	478,281		648,600		510,006
Diluted weighted average vested units and common unit equivalents outstanding	115,573,787		105,872,575		102,535,282
Basic earnings per unit:
Net income available to common unitholders per unit	$	1.63	$	1.87	$	2.56
Diluted earnings per unit:
Net income available to common unitholders per unit	$	1.62	$	1.86	$	2.55

____________________ 

(1)Participating securities include nonvested shares, certain time-based RSUs and vested market measure-based RSUs.

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Supplemental Cash Flow Information of the Company (Tables)

12 Months Ended

Dec. 31, 2020

Supplemental Cash Flow Elements [Abstract]

Schedule of supplemental cash flows

Supplemental cash flow information follows (in thousands):

	Year Ended December 31,
	2020		2019		2018
SUPPLEMENTAL CASH FLOWS INFORMATION:
Cash paid for interest, net of capitalized interest of $75,852, $77,666, and $65,627 as of    December 31, 2020, 2019 and 2018, respectively	$	61,741	$	43,607	$	44,697
Cash paid for amounts included in the measurement of ground lease liabilities	$	5,744	$	5,224	$	4,398
NON-CASH INVESTING TRANSACTIONS:
Accrual for expenditures for operating properties and development properties	$	189,161	$	162,654	$	158,626
Tenant improvements funded directly by tenants	$	11,592	$	10,268	$	13,968
Assumption of accrued liabilities in connection with acquisitions (Note 3)	$	—	$	10,267	$	40,624
Initial measurement of operating right of use ground lease assets (Notes 2, 3 and 18)	$	—	$	96,272	$	—
Initial measurement of operating ground lease liabilities (Notes 2, 3 and 18)	$	—	$	98,349	$	—
NON-CASH FINANCING TRANSACTIONS:
Accrual of dividends and distributions payable to common stockholders and common unitholders (Notes 13 and 27)	$	59,431	$	53,219	$	47,559
Exchange of common units of the Operating Partnership into shares of the Company’s common stock	$	37,640	$	78	$	1,962

Supplemental cash flow information follows (in thousands):

	Year Ended December 31,
	2020		2019		2018
SUPPLEMENTAL CASH FLOWS INFORMATION:
Cash paid for interest, net of capitalized interest of $75,852, $77,666, and $65,627 as of December 31, 2020, 2019 and 2018, respectively	$	61,741	$	43,607	$	44,697
Cash paid for amounts included in the measurement of ground lease liabilities	$	5,744	$	5,224	$	4,398
NON-CASH INVESTING TRANSACTIONS:
Accrual for expenditures for operating properties and development properties	$	189,161	$	162,654	$	158,626
Tenant improvements funded directly by tenants	$	11,592	$	10,268	$	13,968
Assumption of accrued liabilities in connection with acquisitions (Note 3)	$	—	$	10,267	$	40,624
Initial measurement of operating right of use ground lease assets (Notes 2, 3 and 18)	$	—	$	96,272	$	—
Initial measurement of operating ground lease liabilities (Notes 2, 3 and 18)	$	—	$	98,349	$	—
NON-CASH FINANCING TRANSACTIONS:
Accrual of distributions payable to common unitholders (Notes 14 and 27)	$	59,431	$	53,219	$	47,559

Reconciliation of cash and cash equivalents and restricted cash

The following is a reconciliation of our cash and cash equivalents and restricted cash at the beginning and end of the years ended December 31, 2020, 2019 and 2018.

	Year Ended December 31,
	2020		2019		2018
RECONCILIATION OF CASH AND CASH EQUIVALENTS AND RESTRICTED CASH:
Cash and cash equivalents at beginning of period	$	60,044	$	51,604	$	57,649
Restricted cash at beginning of period	16,300		119,430		9,149
Cash and cash equivalents and restricted cash at beginning of period	$	76,344	$	171,034	$	66,798
Cash and cash equivalents at end of period	$	731,991	$	60,044	$	51,604
Restricted cash at end of period	91,139		16,300		119,430
Cash and cash equivalents and restricted cash at end of period	$	823,130	$	76,344	$	171,034

The following is a reconciliation of our cash and cash equivalents and restricted cash at the beginning and end of the years ended December 31, 2020, 2019 and 2018.

	Year Ended December 31,
	2020		2019		2018
RECONCILIATION OF CASH AND CASH EQUIVALENTS AND RESTRICTED CASH:
Cash and cash equivalents at beginning of period	$	60,044	$	51,604	$	57,649
Restricted cash at beginning of period	16,300		119,430		9,149
Cash and cash equivalents and restricted cash at beginning of period	$	76,344	$	171,034	$	66,798
Cash and cash equivalents at end of period	$	731,991	$	60,044	$	51,604
Restricted cash at end of period	91,139		16,300		119,430
Cash and cash equivalents and restricted cash at end of period	$	823,130	$	76,344	$	171,034

XML

Supplemental Cash Flow Elements (Tables)

12 Months Ended

Dec. 31, 2020

Supplemental Cash Flow Elements [Abstract]

Schedule of supplemental cash flows, operating unit

Supplemental cash flow information follows (in thousands):

	Year Ended December 31,
	2020		2019		2018
SUPPLEMENTAL CASH FLOWS INFORMATION:
Cash paid for interest, net of capitalized interest of $75,852, $77,666, and $65,627 as of    December 31, 2020, 2019 and 2018, respectively	$	61,741	$	43,607	$	44,697
Cash paid for amounts included in the measurement of ground lease liabilities	$	5,744	$	5,224	$	4,398
NON-CASH INVESTING TRANSACTIONS:
Accrual for expenditures for operating properties and development properties	$	189,161	$	162,654	$	158,626
Tenant improvements funded directly by tenants	$	11,592	$	10,268	$	13,968
Assumption of accrued liabilities in connection with acquisitions (Note 3)	$	—	$	10,267	$	40,624
Initial measurement of operating right of use ground lease assets (Notes 2, 3 and 18)	$	—	$	96,272	$	—
Initial measurement of operating ground lease liabilities (Notes 2, 3 and 18)	$	—	$	98,349	$	—
NON-CASH FINANCING TRANSACTIONS:
Accrual of dividends and distributions payable to common stockholders and common unitholders (Notes 13 and 27)	$	59,431	$	53,219	$	47,559
Exchange of common units of the Operating Partnership into shares of the Company’s common stock	$	37,640	$	78	$	1,962

Supplemental cash flow information follows (in thousands):

	Year Ended December 31,
	2020		2019		2018
SUPPLEMENTAL CASH FLOWS INFORMATION:
Cash paid for interest, net of capitalized interest of $75,852, $77,666, and $65,627 as of December 31, 2020, 2019 and 2018, respectively	$	61,741	$	43,607	$	44,697
Cash paid for amounts included in the measurement of ground lease liabilities	$	5,744	$	5,224	$	4,398
NON-CASH INVESTING TRANSACTIONS:
Accrual for expenditures for operating properties and development properties	$	189,161	$	162,654	$	158,626
Tenant improvements funded directly by tenants	$	11,592	$	10,268	$	13,968
Assumption of accrued liabilities in connection with acquisitions (Note 3)	$	—	$	10,267	$	40,624
Initial measurement of operating right of use ground lease assets (Notes 2, 3 and 18)	$	—	$	96,272	$	—
Initial measurement of operating ground lease liabilities (Notes 2, 3 and 18)	$	—	$	98,349	$	—
NON-CASH FINANCING TRANSACTIONS:
Accrual of distributions payable to common unitholders (Notes 14 and 27)	$	59,431	$	53,219	$	47,559

Reconciliation of cash and cash equivalents and restricted cash

The following is a reconciliation of our cash and cash equivalents and restricted cash at the beginning and end of the years ended December 31, 2020, 2019 and 2018.

	Year Ended December 31,
	2020		2019		2018
RECONCILIATION OF CASH AND CASH EQUIVALENTS AND RESTRICTED CASH:
Cash and cash equivalents at beginning of period	$	60,044	$	51,604	$	57,649
Restricted cash at beginning of period	16,300		119,430		9,149
Cash and cash equivalents and restricted cash at beginning of period	$	76,344	$	171,034	$	66,798
Cash and cash equivalents at end of period	$	731,991	$	60,044	$	51,604
Restricted cash at end of period	91,139		16,300		119,430
Cash and cash equivalents and restricted cash at end of period	$	823,130	$	76,344	$	171,034

The following is a reconciliation of our cash and cash equivalents and restricted cash at the beginning and end of the years ended December 31, 2020, 2019 and 2018.

	Year Ended December 31,
	2020		2019		2018
RECONCILIATION OF CASH AND CASH EQUIVALENTS AND RESTRICTED CASH:
Cash and cash equivalents at beginning of period	$	60,044	$	51,604	$	57,649
Restricted cash at beginning of period	16,300		119,430		9,149
Cash and cash equivalents and restricted cash at beginning of period	$	76,344	$	171,034	$	66,798
Cash and cash equivalents at end of period	$	731,991	$	60,044	$	51,604
Restricted cash at end of period	91,139		16,300		119,430
Cash and cash equivalents and restricted cash at end of period	$	823,130	$	76,344	$	171,034

XML

Tax Treatment of Distributions (Tables)

12 Months Ended

Dec. 31, 2020

Class of Stock [Line Items]

Reconciliation of dividends declared to dividends paid

The following table reconciles the dividends declared per share of common stock to the dividends paid per share of common stock during the years ended December 31, 2020, 2019 and 2018 as follows: 

	Year Ended December 31,
Dividends	2020		2019		2018
Dividends declared per share of common stock	$	1.970	$	1.910	$	1.790
Less: Dividends declared in the current year and paid in the following year	(0.500)		(0.485)		(0.455)
Add: Dividends declared in the prior year and paid in the current year	0.485		0.455		0.425
Dividends paid per share of common stock	$	1.955	$	1.880	$	1.760

Common Stock [Member]

Class of Stock [Line Items]

Reconciliation of dividends declared to dividends paid

The unaudited income tax treatment for the dividends to common stockholders reportable for the years ended December 31, 2020, 2019 and 2018 as identified in the table above was as follows: 

	Year Ended December 31,
Shares of Common Stock	2020				2019				2018
Ordinary income (1)	$	1.474	75.40	%	$	0.939	49.95	%	$	1.474	83.73	%
Qualified dividend	0.002		0.12		0.004		0.21		0.003		0.19
Return of capital	0.162		8.30		0.312		16.62		0.275		15.64
Capital gains (2)	0.275		14.05		0.600		31.93		0.008		0.44
Unrecaptured section 1250 gains	0.042		2.13		0.025		1.29		—		—
	$	1.955	100.00	%	$	1.880	100.00	%	$	1.760	100.00	%

____________________

(1)The Tax Cuts and Jobs Act enacted on December 22, 2017 generally allows a deduction for noncorporate taxpayers equal to 20% of ordinary dividends distributed by a REIT (excluding capital gain dividends and qualified dividend income). The amount of dividend eligible for this deduction is referred to as the Section 199A Dividend.  For the year ended December 31, 2020, the Section 199A Dividend is equal to the total ordinary income dividend.

(2)Capital gains are comprised entirely of 20% rate gains.

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Quarterly Financial Information of the Company (Unaudited) (Tables)

12 Months Ended

Dec. 31, 2020

Quarterly Financial Information Disclosure [Abstract]

Schedule of summarized quarterly financial data

Summarized quarterly financial data for the years ended December 31, 2020 and 2019 was as follows: 

	2020 Quarter Ended (1)
	March 31,		June 30,		September 30,		December 31,
	(in thousands, except per share amounts)
Revenues	$	221,328	$	219,423	$	228,314	$	229,332
Net income	45,418		24,352		54,071		83,452
Net income attributable to Kilroy Realty Corporation	39,817		19,618		49,028		78,642
Net income available to common stockholders	39,817		19,618		49,028		78,642
Net income available to common stockholders per share – basic	0.37		0.17		0.42		0.67
Net income available to common stockholders per share – diluted	0.37		0.17		0.42		0.67
	2019 Quarter Ended (1)
	March 31,		June 30,		September 30,		December 31,
	(in thousands, except per share amounts)
Revenues	$	201,202	$	200,492	$	215,525	$	220,235
Net income	41,794		47,215		48,298		77,922
Net income attributable to Kilroy Realty Corporation	36,903		42,194		43,846		72,500
Net income available to common stockholders	36,903		42,194		43,846		72,500
Net income available to common stockholders per share – basic	0.36		0.41		0.41		0.68
Net income available to common stockholders per share – diluted	0.36		0.41		0.41		0.67

____________________

(1)    The summation of the quarterly financial data may not equal the annual number reported on the consolidated statements of operations due to rounding.

XML

Quarterly Financial Information of the Operating Partnership (Unaudited) (Tables)

12 Months Ended

Dec. 31, 2020

Schedule of summarized quarterly financial data

Summarized quarterly financial data for the years ended December 31, 2020 and 2019 was as follows: 

	2020 Quarter Ended (1)
	March 31,		June 30,		September 30,		December 31,
	(in thousands, except per share amounts)
Revenues	$	221,328	$	219,423	$	228,314	$	229,332
Net income	45,418		24,352		54,071		83,452
Net income attributable to Kilroy Realty Corporation	39,817		19,618		49,028		78,642
Net income available to common stockholders	39,817		19,618		49,028		78,642
Net income available to common stockholders per share – basic	0.37		0.17		0.42		0.67
Net income available to common stockholders per share – diluted	0.37		0.17		0.42		0.67
	2019 Quarter Ended (1)
	March 31,		June 30,		September 30,		December 31,
	(in thousands, except per share amounts)
Revenues	$	201,202	$	200,492	$	215,525	$	220,235
Net income	41,794		47,215		48,298		77,922
Net income attributable to Kilroy Realty Corporation	36,903		42,194		43,846		72,500
Net income available to common stockholders	36,903		42,194		43,846		72,500
Net income available to common stockholders per share – basic	0.36		0.41		0.41		0.68
Net income available to common stockholders per share – diluted	0.36		0.41		0.41		0.67

____________________

(1)    The summation of the quarterly financial data may not equal the annual number reported on the consolidated statements of operations due to rounding.

Kilroy Realty L.P. [Member]

Schedule of summarized quarterly financial data

Summarized quarterly financial data for the years ended December 31, 2020 and 2019 was as follows:

	2020 Quarter Ended (1)
	March 31,		June 30,		September 30,		December 31,
	(in thousands, except per unit amounts)
Revenues	$	221,328	$	219,423	$	228,314	$	229,332
Net income	45,418		24,352		54,071		83,452
Net income attributable to the Operating Partnership	40,389		19,838		49,728		79,654
Net income available to common unitholders	40,389		19,838		49,728		79,654
Net income available to common unitholders per unit – basic	0.37		0.16		0.42		0.67
Net income available to common unitholders per unit – diluted	0.36		0.16		0.42		0.67
	2019 Quarter Ended (1)
	March 31,		June 30,		September 30,		December 31,
	(in thousands, except per unit amounts)
Revenues	$	201,202	$	200,492	$	215,525	$	220,235
Net income	41,794		47,215		48,298		77,922
Net income attributable to the Operating Partnership	37,508		42,901		44,589		73,740
Net income available to common unitholders	37,508		42,901		44,589		73,740
Net income available to common unitholders per unit – basic	0.36		0.41		0.41		0.68
Net income available to common unitholders per unit – diluted	0.36		0.41		0.41		0.67

______________________

(1)    The summation of the quarterly financial data may not equal the annual number reported on the consolidated statements of operations due to rounding.

XML

Organization and Ownership (Details)	Dec. 31, 2020 ft² property residential_unit building project tenant
Real Estate Properties [Line Items]
Rentable Square Feet	14,620,166
Stabilized office properties [Member]
Real Estate Properties [Line Items]
Number of buildings | building	117
Rentable Square Feet	14,620,166
Number of Tenants | tenant	447
Percentage Occupied	91.20%
Percentage Leased (unaudited)	94.30%
Stabilized residential properties [Member]
Real Estate Properties [Line Items]
Number of buildings | property	2
Percentage Occupied	72.00%
Number of residential units | property	808
In-process development projects - tenant improvement [Member]
Real Estate Properties [Line Items]
Number of buildings | property	3
Rentable Square Feet	1,080,000
In-process development projects - under construction [Member]
Real Estate Properties [Line Items]
Number of buildings | project	3
Rentable Square Feet	856,000
Number of residential units | residential_unit	193

XML

Organization and Ownership - Narrative (Details)	12 Months Ended
	Dec. 31, 2020 ft² a property building property_partnership project	Dec. 31, 2019
Real Estate Properties [Line Items]
Lease-up properties occupancy percentage	95.00%
Lease-up properties occupancy duration	1 year
Stabilized Residential Units in San Diego, CA [Member]
Real Estate Properties [Line Items]
Number of Units	608
101 First LLC and 303 Second LLC [Member]
Real Estate Properties [Line Items]
Number of properties | property_partnership	2
Ownership interest	56.00%
Redwood LLC [Member]
Real Estate Properties [Line Items]
Ownership interest	93.00%
Operating Partnership [Member]
Real Estate Properties [Line Items]
Number of properties | property_partnership	3
Ownership interest	99.00%	98.10%
Operating Partnership [Member] | Non-Affiliated Investors [Member]
Real Estate Properties [Line Items]
Ownership interest of noncontrolling interest	1.00%	1.90%
Washington [Member]
Real Estate Properties [Line Items]
Number of properties	8
Number of development projects	1
Number of future development projects	1
Stabilized Portfolio [Member]
Real Estate Properties [Line Items]
Number of development projects	4
Office properties [Member]
Real Estate Properties [Line Items]
Number of properties | building	117
Office properties [Member] | Operating Partnership [Member]
Real Estate Properties [Line Items]
Number of properties	4
Office properties [Member] | San Francisco, California [Member] | 101 First LLC and 303 Second LLC [Member]
Real Estate Properties [Line Items]
Number of properties	1
Office properties [Member] | Redwood City, California [Member] | Redwood LLC [Member]
Real Estate Properties [Line Items]
Number of properties	2
Development sites [Member]
Real Estate Properties [Line Items]
Number of properties | project	5
Area of undeveloped land | a	61
Properties and development projects [Member]
Real Estate Properties [Line Items]
Property ownership percentage	100.00%
Development Project in San Francisco [Member] | Stabilized Office Properties [Member] | San Francisco, California [Member]
Real Estate Properties [Line Items]
Area of real estate property | ft²	750,370
Development Project in Hollywood [Member] | Stabilized Office Properties [Member] | Hollywood, California [Member]
Real Estate Properties [Line Items]
Area of real estate property | ft²	361,388
Development Project in San Diego, California [Member] | Stabilized Retail Space [Member] | San Diego, California [Member]
Real Estate Properties [Line Items]
Area of real estate property | ft²	95,871

XML

Basis of Presentation and Significant Accounting Policies - Narrative (Details)	3 Months Ended	12 Months Ended
	Dec. 31, 2019 USD ($) property investment	Dec. 31, 2020 USD ($) property segment variable_interest_entity investment property_partnership	Dec. 31, 2019 USD ($) property property_partnership variable_interest_entity investment	Dec. 31, 2018 USD ($)
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Number of VIEs | variable_interest_entity		2	4
Assets	$ 8,900,094,000	$ 10,000,708,000	$ 8,900,094,000
Liabilities	4,329,236,000	4,723,387,000	4,329,236,000
Noncontrolling interest in consolidated subsidiary	$ 195,431,000	$ 197,503,000	$ 195,431,000
Number of equity method investments | investment	0	0	0
Number of properties classified as held for sale | property	0	0	0
Number of consolidated property partnerships | property_partnership		3
Conversion ratio		1
Income tax provision		$ 0	$ 0	$ 0
Number of operating segments | segment		1
Washington [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Number of buildings | property		8
Number of development projects | property		1
Number of future development projects | property		1
Building and building improvements [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Depreciation of real estate		$ 244,800,000	211,900,000	$ 198,600,000
Minimum [Member] | Building and building improvements [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Property depreciable lives		25 years
Minimum [Member] | Leasehold improvements [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Property depreciable lives		1 year
Maximum [Member] | Building and building improvements [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Property depreciable lives		40 years
Maximum [Member] | Leasehold improvements [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Property depreciable lives		20 years
Lease Agreements [Member] | Minimum [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Finite-lived intangible asset, useful life		1 year
Lease Agreements [Member] | Maximum [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Finite-lived intangible asset, useful life		20 years
Disposal group, disposed of by sale [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Restricted cash	$ 0	$ 74,900,000	$ 0
100 First LLC and 303 Second LLC [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Number of VIEs | property_partnership			2
Number of buildings | property_partnership		2
Section 1031 Exchange [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Number of VIEs | property	2
Finance Partnership [Member] | Kilroy Realty Finance, Inc. [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Percentage of general partnership interest owned by wholly-owned subsidiary of the Company			1.00%
Variable Interest Entity, Primary Beneficiary [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Assets	$ 676,700,000	$ 469,300,000	$ 676,700,000
Liabilities	40,100,000	33,900,000	40,100,000
Variable Interest Entity, Primary Beneficiary [Member] | 100 First LLC and 303 Second LLC [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Noncontrolling interest in consolidated subsidiary	189,600,000	191,900,000	189,600,000
Variable Interest Entity, Primary Beneficiary [Member] | Real estate investment [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Assets	$ 598,000,000.0	$ 394,600,000	$ 598,000,000.0

XML

Acquisitions - Operating Property Acquisitions (Details) $ in Millions		12 Months Ended
	Oct. 15, 2019 USD ($) ft² property	Dec. 31, 2020 ft² property	Dec. 31, 2019 USD ($) property
Schedule of Asset Acquisitions, by Acquisition [Line Items]
Number of buildings acquired | property		0
Rentable Square Feet (unaudited) | ft²		14,620,166
Purchase price			$ 173.0
3101-3243 La Cienega Boulevard, Culver City, CA [Member]
Schedule of Asset Acquisitions, by Acquisition [Line Items]
Number of buildings acquired | property	19		19
Rentable Square Feet (unaudited) | ft²	151,908
Purchase price	$ 186.0
Revenue contributed from acquired properties			$ 3.7
Net income (loss) contributed from acquired properties			$ (0.1)

XML

Acquisitions - Estimated Fair Values of Assets and Liabilities Assumed (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2019 USD ($)
Assets
Land and improvements	$ 150,561
Buildings and improvements	30,932
Deferred leasing costs and acquisition-related intangible assets	12,063
Right of use ground lease asset	13,334
Total assets acquired	206,890
Liabilities
Acquisition-related intangible liabilities	9,950
Ground lease liability	10,940
Total liabilities assumed	20,890
Net assets and liabilities acquired	$ 186,000
Discount rate	4.79%
Below-market leases acquired	$ 10,000
Weighted average amortization period of below-market leases	3 years 6 months
In-place leases [Member]
Assets
Deferred leasing costs and acquisition-related intangible assets	$ 9,200
Liabilities
Weighted average amortization period of above-market leases in years	3 years 3 months 18 days
Deferred leasing costs [Member]
Assets
Deferred leasing costs and acquisition-related intangible assets	$ 2,900
Liabilities
Weighted average amortization period of above-market leases in years	3 years 6 months

XML

Acquisitions - Development Project Acquisitions and Acquisition Costs (Details) - USD ($) $ in Thousands			12 Months Ended
	Dec. 12, 2019	Aug. 19, 2019	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Schedule of Asset Acquisitions, by Acquisition [Line Items]
Purchase price				$ 173,000
Asset acquisition, accrued liabilities				20,890
Restricted cash			$ 91,139	16,300	$ 119,430	$ 9,149
Payments to acquire land parcel				99,500
Acquisition costs, capitalized			300	1,600	$ 3,800
1335 Broadway & 901 Park Boulevard, San Diego, CA [Member]
Schedule of Asset Acquisitions, by Acquisition [Line Items]
Purchase price		$ 40,000
Asset acquisition, accrued liabilities		$ 4,000
Seattle CBD Project [Member]
Schedule of Asset Acquisitions, by Acquisition [Line Items]
Purchase price	$ 133,000
Asset acquisition, accrued liabilities				6,300
Restricted cash			$ 10,000	$ 10,000

XML

Dispositions - Operating Property Dispositions (Details) $ in Thousands	1 Months Ended				12 Months Ended
	Oct. 31, 2019 USD ($) ft² property	May 31, 2019 USD ($) ft² property	Dec. 31, 2018 USD ($) ft² property	Nov. 30, 2018 USD ($) ft² property	Dec. 31, 2020 USD ($) ft² property	Dec. 31, 2019 USD ($) ft² property	Dec. 31, 2018 USD ($) ft² property
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Rentable square feet | ft²					14,620,166
Gains on sales of operating properties | $					$ 35,536	$ 36,802	$ 142,926
Disposal group, disposed of by sale [Member] | 2020 Dispositions [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Number of buildings | property					1
Rentable square feet | ft²					87,147
Proceeds from sale of property held-for-sale | $					$ 75,900
Disposal group, disposed of by sale [Member] | 331 Fairchild Drive, Mountain View, CA [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Number of buildings | property					1
Rentable square feet | ft²					87,147
Proceeds from sale of property held-for-sale | $					$ 75,900
Disposal group, disposed of by sale [Member] | 2019 Dispositions [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Number of buildings | property						2
Rentable square feet | ft²						355,654
Proceeds from sale of property held-for-sale | $						$ 133,800
Disposal group, disposed of by sale [Member] | 2829 Townsgate Road, Thousand Oaks, CA [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Number of buildings | property		1
Rentable square feet | ft²		84,098
Proceeds from sale of property held-for-sale | $		$ 18,300
Disposal group, disposed of by sale [Member] | 2211 Michelson Drive Irvine CA [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Number of buildings | property	1
Rentable square feet | ft²	271,556
Proceeds from sale of property held-for-sale | $	$ 115,500
Disposal group, disposed of by sale [Member] | 2018 Dispositions [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Number of buildings | property			11				11
Rentable square feet | ft²			772,246				772,246
Proceeds from sale of property held-for-sale | $							$ 373,000
Disposal group, disposed of by sale [Member] | 1325-1327 Chesapeake Terrace, Sunnyvale, CA [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Number of buildings | property				4
Rentable square feet | ft²				266,982
Proceeds from sale of property held-for-sale | $				$ 160,300
Disposal group, disposed of by sale [Member] | Plaza Yarrow Bay Properties [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Number of buildings | property				4
Rentable square feet | ft²				279,924
Proceeds from sale of property held-for-sale | $				$ 134,500
Disposal group, disposed of by sale [Member] | 23925, 23975, & 24025 Park Sorrento, Calabasas, CA [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Number of buildings | property			3				3
Rentable square feet | ft²			225,340				225,340
Proceeds from sale of property held-for-sale | $			$ 78,200

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Dispositions - Land Dispositions (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Net gain (loss) on sales of land	$ 0	$ 0	$ 11,825
Disposal group, disposed of by sale [Member] | Plaza Yarrow Bay Properties [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Net gain (loss) on sales of land			$ 11,800

XML

Dispositions - Restricted Cash Related to Dispositions (Details) - USD ($)	Dec. 31, 2020	Dec. 31, 2019
Disposal group, disposed of by sale [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Restricted cash	$ 74,900,000	$ 0

XML

Deferred Leasing Costs and Acquisition-Related Intangible Assets and Liabilities, net - Deferred Leasing Costs and Acquisition-related Intangible Assets and Intangible Assets (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Deferred Leasing Costs and Acquisition-related Intangible Assets and Liabilities, Net
Total deferred leasing costs and acquisition-related intangible assets, net	$ 210,949	$ 212,805
Acquisition-related Intangible Liabilities, Net [Abstract]
Total acquisitions-related intangible liabilities, net	13,345	24,092
Deferred leasing costs [Member]
Deferred Leasing Costs and Acquisition-related Intangible Assets and Liabilities, Net
Finite-lived intangible assets/liabilities, gross	300,556	286,026
Accumulated amortization	(104,277)	(100,145)
Finite-lived intangible assets	196,279	185,881
Above market leases [Member]
Deferred Leasing Costs and Acquisition-related Intangible Assets and Liabilities, Net
Finite-lived intangible assets/liabilities, gross	0	611
Accumulated amortization	0	(116)
Finite-lived intangible assets	0	495
In-place leases [Member]
Deferred Leasing Costs and Acquisition-related Intangible Assets and Liabilities, Net
Finite-lived intangible assets/liabilities, gross	40,323	58,076
Accumulated amortization	(25,653)	(31,647)
Finite-lived intangible assets	14,670	26,429
Below-market operating leases [Member]
Acquisition-related Intangible Liabilities, Net [Abstract]
Acquisition-related intangible liabilities, gross	26,405	51,263
Accumulated amortization	(13,060)	(27,171)
Acquisition-related intangible liabilities, net	$ 13,345	$ 24,092

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Deferred Leasing Costs and Acquisition-Related Intangible Assets and Liabilities, net - Amortization of Deferred Leasing Costs and Acquisition-related Intangibles (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Amortization for the period related to deferred leasing costs and acquisition-related intangibles
Amortization for the period related to deferred leasing costs and acquisition-related intangibles	$ 35,130	$ 45,188	$ 40,415
Deferred leasing costs [Member]
Amortization for the period related to deferred leasing costs and acquisition-related intangibles
Amortization for the period related to deferred leasing costs and acquisition-related intangibles	33,624	35,779	34,341
Estimated annual amortization related to acquisition-related intangible assets
Finite-lived intangible assets, 2021	31,048
Finite-lived intangible assets, 2022	28,334
Finite-lived intangible assets, 2023	24,470
Finite-lived intangible assets, 2024	21,545
Finite-lived intangible assets, 2025	19,726
Finite-lived intangible assets, thereafter	71,156
Finite-lived intangible assets	196,279	185,881
Above market leases [Member]
Amortization for the period related to deferred leasing costs and acquisition-related intangibles
Amortization for the period related to deferred leasing costs and acquisition-related intangibles	495	192	444
Estimated annual amortization related to acquisition-related intangible assets
Finite-lived intangible assets	0	495
In-place leases [Member]
Amortization for the period related to deferred leasing costs and acquisition-related intangibles
Amortization for the period related to deferred leasing costs and acquisition-related intangibles	11,759	18,615	15,915
Estimated annual amortization related to acquisition-related intangible assets
Finite-lived intangible assets, 2021	6,531
Finite-lived intangible assets, 2022	3,885
Finite-lived intangible assets, 2023	1,534
Finite-lived intangible assets, 2024	584
Finite-lived intangible assets, 2025	473
Finite-lived intangible assets, thereafter	1,663
Finite-lived intangible assets	14,670	26,429
Below-market ground lease obligation [Member]
Amortization for the period related to deferred leasing costs and acquisition-related intangibles
Amortization for the period related to deferred leasing costs and acquisition-related intangibles	0	0	8
Below-market operating leases [Member]
Amortization for the period related to deferred leasing costs and acquisition-related intangibles
Amortization of intangible liabilities	(10,748)	(9,398)	(10,192)
Estimated annual amortization related to acquisition-related intangible liabilities
Acquisition-related intangible liabilities, 2021	(4,152)
Acquisition-related intangible liabilities, 2022	(3,167)
Acquisition-related intangible liabilities, 2023	(1,486)
Acquisition-related intangible liabilities, 2024	(812)
Acquisition-related intangible liabilities, 2025	(710)
Acquisition-related intangible liabilities, thereafter	(3,018)
Acquisition-related intangible liabilities	(13,345)	(24,092)
Above-market ground lease obligation [Member]
Amortization for the period related to deferred leasing costs and acquisition-related intangibles
Amortization of intangible liabilities	$ 0	$ 0	$ (101)

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Receivables - Current Receivables and Deferred Rent Receivables (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Current Receivables, net
Current receivables	$ 13,806	$ 27,660
Allowance for uncollectible tenant receivables	(1,799)	(1,171)
Current receivables, net	12,007	26,489
Deferred Rent Receivables, net
Deferred rent receivables	387,462	339,489
Allowance for deferred rent receivables	(804)	(1,552)
Deferred rent receivables, net	$ 386,658	$ 337,937

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Prepaid Expenses and Other Assets, Net - Schedule of Prepaid Expenses and Other Assets (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Furniture, fixtures and other long-lived assets, net	$ 43,367	$ 35,286
Prepaid expenses	10,193	18,724
Notes receivable, net	0	1,651
Total prepaid expenses and other assets, net	$ 53,560	55,661
Non-refundable acquisition deposit		$ 3,600

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Secured and Unsecured Debt of the Company - Narrative (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Debt Instrument [Line Items]
Secured debt	$ 253,582	$ 258,593
Unsecured debt [Member]
Debt Instrument [Line Items]
Long-term debt	$ 3,700,000	$ 3,300,000

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Secured and Unsecured Debt of the Operating Partnership - Secured Debt (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Secured Debt
Secured debt	$ 253,582	$ 258,593
Kilroy Realty L.P. [Member]
Secured Debt
Long-term debt, gross	3,954,365
Secured debt	253,582	258,593
Unamortized Deferred Financing Costs	(22,400)
Kilroy Realty L.P. [Member] | Secured debt [Member]
Secured Debt
Secured debt	254,365	259,502
Unamortized Deferred Financing Costs	(783)	(909)
Long-term debt	253,582	258,593
Net book value of properties pledged as collateral for secured debt	$ 222,000
Kilroy Realty L.P. [Member] | Secured debt [Member] | 3.57% Mortgage Payable due December 2026 [Member]
Secured Debt
Stated interest rate	3.57%
Effective interest rate	3.57%
Long-term debt, gross	$ 166,776	170,000
Kilroy Realty L.P. [Member] | Secured debt [Member] | 4.48% Mortgage Payable due July 2027 [Member]
Secured Debt
Stated interest rate	4.48%
Effective interest rate	4.48%
Long-term debt, gross	$ 87,589	$ 89,502

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Secured and Unsecured Debt of the Operating Partnership - Unsecured Senior Notes Table (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Aug. 31, 2020	Dec. 31, 2019	Sep. 30, 2019
Debt Instrument [Line Items]
Unsecured debt, net	$ 3,670,099		$ 3,049,185
Unsecured debt [Member]
Debt Instrument [Line Items]
Unamortized discount (premium), net	(8,300)		(6,500)
Unamortized debt issuance expense	21,600		18,700
Kilroy Realty L.P. [Member]
Debt Instrument [Line Items]
Unamortized debt issuance expense	22,400
Long-term debt, gross	3,954,365
Unsecured debt, net	3,670,099		3,049,185
Kilroy Realty L.P. [Member] | Unsecured debt [Member]
Debt Instrument [Line Items]
Unsecured debt, net	$ 3,670,099		2,899,839
Kilroy Realty L.P. [Member] | Unsecured debt [Member] | 2.500% Unsecured Senior Notes [Member]
Debt Instrument [Line Items]
Unamortized discount (premium), net		$ (2,700)
Stated interest rate	2.50%
Effective interest rate	2.56%
Long-term debt, gross	$ 425,000		0
Unamortized discount and deferred financing costs	(6,332)		0
Unsecured debt, net	$ 418,668		0
Kilroy Realty L.P. [Member] | Unsecured debt [Member] | 4.270% Unsecured Senior Notes [Member]
Debt Instrument [Line Items]
Stated interest rate	4.27%
Effective interest rate	4.27%
Long-term debt, gross	$ 350,000		0
Unamortized discount and deferred financing costs	(1,825)		0
Unsecured debt, net	$ 348,175		0
Kilroy Realty L.P. [Member] | Unsecured debt [Member] | 3.050% Unsecured Senior Notes [Member]
Debt Instrument [Line Items]
Unamortized discount (premium), net				$ (600)
Stated interest rate	3.05%
Effective interest rate	3.064%
Long-term debt, gross	$ 500,000		500,000
Unamortized discount and deferred financing costs	(5,399)		(5,998)
Unsecured debt, net	$ 494,601		494,002
Kilroy Realty L.P. [Member] | Unsecured debt [Member] | 4.750% Unsecured Senior Notes [Member]
Debt Instrument [Line Items]
Stated interest rate	4.75%
Effective interest rate	4.80%
Long-term debt, gross	$ 400,000		400,000
Unamortized discount and deferred financing costs	(3,952)		(4,446)
Unsecured debt, net	$ 396,048		395,554
Kilroy Realty L.P. [Member] | Unsecured debt [Member] | 4.350% Unsecured Senior Notes [Member]
Debt Instrument [Line Items]
Stated interest rate	4.35%
Effective interest rate	4.35%
Long-term debt, gross	$ 200,000		200,000
Unamortized discount and deferred financing costs	(1,012)		(1,186)
Unsecured debt, net	$ 198,988		198,814
Kilroy Realty L.P. [Member] | Unsecured debt [Member] | 4.300% Unsecured Senior Notes [Member]
Debt Instrument [Line Items]
Stated interest rate	4.30%
Effective interest rate	4.30%
Long-term debt, gross	$ 50,000		50,000
Unamortized discount and deferred financing costs	(246)		(290)
Unsecured debt, net	$ 49,754		49,710
Kilroy Realty L.P. [Member] | Unsecured debt [Member] | 3.450% Unsecured Senior Notes [Member]
Debt Instrument [Line Items]
Stated interest rate	3.45%
Effective interest rate	3.47%
Long-term debt, gross	$ 425,000		425,000
Unamortized discount and deferred financing costs	(2,321)		(2,907)
Unsecured debt, net	$ 422,679		422,093
Kilroy Realty L.P. [Member] | Unsecured debt [Member] | 3.450% Unsecured Senior Notes [Member]
Debt Instrument [Line Items]
Stated interest rate	3.45%
Effective interest rate	3.45%
Long-term debt, gross	$ 75,000		75,000
Unamortized discount and deferred financing costs	(347)		(390)
Unsecured debt, net	$ 74,653		74,610
Kilroy Realty L.P. [Member] | Unsecured debt [Member] | 3.350% Unsecured Senior Notes [Member]
Debt Instrument [Line Items]
Stated interest rate	3.35%
Effective interest rate	3.35%
Long-term debt, gross	$ 175,000		175,000
Unamortized discount and deferred financing costs	(709)		(825)
Unsecured debt, net	$ 174,291		174,175
Kilroy Realty L.P. [Member] | Unsecured debt [Member] | 4.375% Unsecured Senior Notes [Member]
Debt Instrument [Line Items]
Stated interest rate	4.375%
Effective interest rate	4.444%
Long-term debt, gross	$ 400,000		400,000
Unamortized discount and deferred financing costs	(2,631)		(3,185)
Unsecured debt, net	$ 397,369		396,815
Kilroy Realty L.P. [Member] | Unsecured debt [Member] | 4.250% Unsecured Senior Notes [Member]
Debt Instrument [Line Items]
Stated interest rate	4.25%
Effective interest rate	4.35%
Long-term debt, gross	$ 400,000		400,000
Unamortized discount and deferred financing costs	(4,567)		(5,100)
Unsecured debt, net	$ 395,433		394,900
Kilroy Realty L.P. [Member] | Unsecured debt [Member] | 3.800% Unsecured Senior Notes [Member]
Debt Instrument [Line Items]
Stated interest rate	3.80%
Effective interest rate	3.80%
Long-term debt, gross	$ 300,000		300,000
Unamortized discount and deferred financing costs	(560)		(834)
Unsecured debt, net	$ 299,440		$ 299,166

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Secured and Unsecured Debt of the Operating Partnership - Unsecured Senior Notes - Registered Offerings and Private Placement (Details) - USD ($)	1 Months Ended	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Aug. 31, 2020	Apr. 30, 2020	Sep. 30, 2019
Debt Instrument [Line Items]
Proceeds from issuance of unsecured debt		$ 772,297,000	$ 499,390,000	$ 648,537,000
Loss on early extinguishment of debt (Note 9)		0	0	12,623,000
Unsecured debt [Member]
Debt Instrument [Line Items]
Unamortized discount (premium), net		(8,300,000)	(6,500,000)
Kilroy Realty L.P. [Member]
Debt Instrument [Line Items]
Proceeds from issuance of unsecured debt		772,297,000	499,390,000	648,537,000
Loss on early extinguishment of debt (Note 9)		$ 0	$ 0	$ 12,623,000
Kilroy Realty L.P. [Member] | Unsecured debt [Member] | 2.500% Unsecured Senior Notes [Member]
Debt Instrument [Line Items]
Principal amount					$ 425,000,000.0
Unamortized discount (premium), net					$ (2,700,000)
Stated interest rate		2.50%
Kilroy Realty L.P. [Member] | Unsecured debt [Member] | 3.050% Unsecured Senior Notes [Member]
Debt Instrument [Line Items]
Principal amount							$ 500,000,000.0
Unamortized discount (premium), net							$ (600,000)
Stated interest rate		3.05%
Kilroy Realty L.P. [Member] | Unsecured debt [Member] | 4.750% Unsecured Senior Notes [Member]
Debt Instrument [Line Items]
Stated interest rate		4.75%
Kilroy Realty L.P. [Member] | Unsecured debt [Member] | 6.625% Unsecured Senior Notes [Member]
Debt Instrument [Line Items]
Stated interest rate	6.625%			6.625%
Extinguishment of debt	$ 250,000,000.0
Loss on early extinguishment of debt (Note 9)	12,600,000
Premium paid to the note holders at the redemption date	11,800,000
Write-off of unamortized discount and unamortized deferred financing costs	$ 800,000
Kilroy Realty L.P. [Member] | Unsecured debt [Member] | 4.270% Unsecured Senior Notes [Member]
Debt Instrument [Line Items]
Principal amount						$ 350,000,000.0
Stated interest rate		4.27%

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Secured and Unsecured Debt of the Operating Partnership - Unsecured Revolving Credit Facility and Term Loan Facility (Details) - USD ($)	1 Months Ended	12 Months Ended
	Aug. 31, 2020	Dec. 31, 2020	Dec. 31, 2019
Terms of the Credit Facility
Outstanding borrowings		$ 0	$ 245,000,000
Kilroy Realty L.P. [Member]
Terms of the Credit Facility
Outstanding borrowings		0	245,000,000
Unamortized debt issuance expense		22,400,000
Kilroy Realty L.P. [Member] | Revolving credit facility [Member]
Terms of the Credit Facility
Outstanding borrowings		0	245,000,000
Remaining borrowing capacity		750,000,000	505,000,000
Total borrowing capacity		$ 750,000,000	$ 750,000,000
Interest rate		1.14%	2.76%
Facility fee-annual rate		0.20%
Contingent additional borrowings		$ 600,000,000.0
Unamortized debt issuance expense		$ 2,100,000	$ 3,400,000
Kilroy Realty L.P. [Member] | Line of credit [Member]
Terms of the Credit Facility
Total borrowing capacity			150,000,000
Kilroy Realty L.P. [Member] | $150.0 million term loan facility [Member] | Line of credit [Member]
Terms of the Credit Facility
Extinguishment of debt	$ 150,000,000.0
Outstanding borrowings			150,000,000
Remaining borrowing capacity			$ 0
Interest rate			2.85%
Undrawn facility fee-annual rate			0.20%
Unamortized debt issuance expense			$ 700,000
Kilroy Realty L.P. [Member] | London Interbank Offered Rate (LIBOR) [Member] | Revolving credit facility [Member]
Terms of the Credit Facility
Basis spread on LIBOR		1.00%	1.00%
Kilroy Realty L.P. [Member] | London Interbank Offered Rate (LIBOR) [Member] | $150.0 million term loan facility [Member] | Line of credit [Member]
Terms of the Credit Facility
Basis spread on LIBOR			1.10%

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Secured and Unsecured Debt of the Operating Partnership - Debt Maturities (Details) - Kilroy Realty L.P. [Member] $ in Thousands	Dec. 31, 2020 USD ($)
Stated debt maturities and scheduled amortization payments, excluding debt discounts
2021	$ 5,342
2022	5,554
2023	305,775
2024	431,006
2025	406,246
Thereafter	2,800,442
Total aggregate principal value	3,954,365
Unamortized debt issuance expense	(22,400)
Unsecured senior notes [Member]
Stated debt maturities and scheduled amortization payments, excluding debt discounts
Debt issuance discount	$ (8,300)

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Secured and Unsecured Debt of the Operating Partnership - Capitalized Interest and Loan Fees (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Debt Instrument [Line Items]
Interest expense	$ 70,772	$ 48,537	$ 49,721
Kilroy Realty L.P. [Member]
Debt Instrument [Line Items]
Gross interest expense	150,325	129,778	117,789
Capitalized interest and deferred financing costs	(79,553)	(81,241)	(68,068)
Interest expense	$ 70,772	$ 48,537	$ 49,721

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Deferred Revenue and Acquisition-Related Intangible Liabilities, net - Deferred Revenue and Acquisition-Related Intangible Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Revenue from Contract with Customer [Abstract]
Deferred revenue	$ 88,645	$ 96,271
Other deferred revenue	26,533	19,125
Acquisition-related intangible liabilities, net	13,345	24,092
Deferred revenue and acquisition-related intangible liabilities, net	$ 128,523	$ 139,488

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Deferred Revenue and Acquisition-Related Intangible Liabilities, net - Estimated Amortization of Deferred Revenue (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Deferred Revenue, Future Amortization Recognized By Year [Abstract]
Total	$ 88,645	$ 96,271
Tenant funded tenant improvements [Member]
Deferred Revenue Arrangement [Line Items]
Deferred revenues amortized and recognized as rental income	22,500	$ 19,200	$ 18,400
Deferred Revenue, Future Amortization Recognized By Year [Abstract]
2021	16,216
2022	15,188
2023	13,367
2024	11,325
2025	8,564
Thereafter	23,985
Total	$ 88,645

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Noncontrolling Interests on the Company’s Consolidated Financial Statements - Narrative (Details) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2020 USD ($) d $ / shares shares	Dec. 31, 2019 USD ($) $ / shares shares	Dec. 31, 2018 shares
Noncontrolling Interest [Line Items]
Conversion ratio	1
Common stock, par value (in dollars per share) | $ / shares	$ 0.01	$ 0.01
Trading days | d	10
Aggregate value upon redemption of outstanding noncontrolling common units	$ 65,400	$ 167,700
Noncontrolling interest in consolidated subsidiary	$ 197,503	$ 195,431
Common units [Member] | Kilroy Realty L.P. [Member]
Noncontrolling Interest [Line Items]
Common units outstanding held by common limited partners (in units) | shares	1,150,574	2,023,287
Conversion ratio	1
Common Stock [Member]
Noncontrolling Interest [Line Items]
Exchange of common units of the Operating Partnership (in units) | shares	872,713	2,000	51,906
Operating Partnership [Member]
Noncontrolling Interest [Line Items]
Ownership interest	99.00%	98.10%
Non-affiliated Investors and Certain Executive Officersand Directors of the Company [Member]
Noncontrolling Interest [Line Items]
Ownership interest of noncontrolling interest	1.00%	1.90%
101 First LLC and 303 Second LLC [Member]
Noncontrolling Interest [Line Items]
Ownership interest	56.00%
101 First LLC and 303 Second LLC [Member] | Variable Interest Entity, Primary Beneficiary [Member]
Noncontrolling Interest [Line Items]
Noncontrolling interest in consolidated subsidiary	$ 191,900	$ 189,600
Redwood LLC [Member]
Noncontrolling Interest [Line Items]
Ownership interest	93.00%
Noncontrolling interest in consolidated subsidiary	$ 5,600	$ 5,800

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Noncontrolling Interests on the Operating Partnership’s Consolidated Financial Statements - Narrative (Details)	Aug. 30, 2016
Consolidated property partnerships [Member] | Norges Bank Real Estate Management (NBREM) [Member]
Noncontrolling Interest [Line Items]
Ownership interest of noncontrolling interest	44.00%

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Stockholders' Equity of the Company - Narrative (Details) - USD ($)			1 Months Ended			12 Months Ended
	Mar. 25, 2020	Feb. 18, 2020	Mar. 31, 2020	Jul. 31, 2019	Aug. 31, 2018	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	May 19, 2020	May 18, 2020	Jun. 30, 2018
Class of Stock [Line Items]
Common stock, authorized (shares)						280,000,000	150,000,000		280,000,000	150,000,000
Common stock, value, issued						$ 1,160,000	$ 1,060,000
Aggregate net proceeds after selling commissions						$ 721,665,000	$ 353,722,000	$ 130,693,000
Sale of stock, shares issued (in shares)						116,035,827	106,016,287
Stock repurchase program, number of shares authorized to be repurchased						4,935,826
Stock repurchased during period (in shares)						0	0	0
2014 At-The-Market Program [Member]
Class of Stock [Line Items]
Aggregate gross proceeds								$ 300,000,000.0
2018 At-The-Market Program [Member]
Class of Stock [Line Items]
Aggregate gross proceeds											$ 500,000,000.0
Issuance of Equity under ATM Program [Member]
Class of Stock [Line Items]
Aggregate net proceeds after selling commissions						$ 247,300,000		132,100,000
Aggregate gross proceeds						$ 252,000,000.0		$ 133,800,000
Shares issued, price per share (in dollars per share)						$ 80.08		$ 73.64
Forward Equity Offering [Member]
Class of Stock [Line Items]
Common stock, value, issued		$ 494,500,000			$ 360,500,000
Stock issued, price per share (in dollar per share)		$ 86.00			$ 72.10
Aggregate net proceeds after selling commissions				$ 354,300,000
Forward Equity Offering [Member] | Common Stock [Member]
Class of Stock [Line Items]
Stock issued (in shares)		5,750,000		5,000,000	5,000,000
Aggregate net proceeds after selling commissions	$ 474,900,000			$ 354,300,000
Sale of stock, shares issued (in shares)	5,750,000		5,750,000	5,000,000
Forward Equity Offering [Member] | Common Stock [Member] | 2014 At-The-Market Program [Member]
Class of Stock [Line Items]
Sale of stock, shares available for sale (in shares)								1,369,729
Forward Equity Offering [Member] | Common Stock [Member] | 2018 At-The-Market Program [Member]
Class of Stock [Line Items]
Stock issued, price per share (in dollar per share)							$ 80.08
Sale of stock, shares available for sale (in shares)							3,147,110	447,466
Sale of stock, shares issued (in shares)						3,594,576
Sale of stock, available for sale under program						$ 214,200,000
Forward Equity Offering [Member] | Common Stock [Member] | Issuance of Equity under ATM Program [Member]
Class of Stock [Line Items]
Aggregate net proceeds after selling commissions			$ 247,300,000			$ 247,300,000
Sale of stock, shares issued (in shares)			3,147,110

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Stockholders' Equity of the Company - At-The-Market Offering and Derivatives and Distributions (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Dividends Payable [Line Items]
Aggregate net proceeds after selling commissions	$ 721,665	$ 353,722	$ 130,693
Accrued dividend and distributions
Accrued dividends and distributions	$ 59,431	$ 53,219
Summary of shares and units
Common stock	116,035,827	106,016,287
Restricted Stock Units (RSUs) [Member]
Summary of shares and units
RSUs	1,638,026	1,651,905
Common stockholders and noncontrolling unitholders [Member]
Accrued dividend and distributions
Accrued dividends and distributions	$ 59,431	$ 53,219
Common Stock [Member]
Accrued dividend and distributions
Accrued dividends and distributions	$ 58,018	$ 51,418
Summary of shares and units
Common stock	116,035,827	106,016,287
Common units [Member]
Accrued dividend and distributions
Accrued dividends and distributions	$ 575	$ 981
Issuance of Equity under ATM Program [Member]
Dividends Payable [Line Items]
Shares of common stock sold during the period (in shares)	3,147,110		1,817,195
Weighted average price per share of common stock (in dollars per share)	$ 80.08		$ 73.64
Aggregate gross proceeds	$ 252,000		$ 133,800
Aggregate net proceeds after selling commissions	247,300		132,100
Kilroy Realty L.P. [Member]
Dividends Payable [Line Items]
Aggregate net proceeds after selling commissions	721,665	353,722	$ 130,693
Accrued dividend and distributions
Accrued dividends and distributions	59,431	53,219
Kilroy Realty L.P. [Member] | Restricted Stock Units (RSUs) [Member]
Accrued dividend and distributions
Accrued dividends and distributions	$ 838	$ 820
Kilroy Realty L.P. [Member] | Market measure-based Restricted Stock Units (RSUs) [Member]
Summary of shares and units
Number of RSUs outstanding (in shares)	873,709	932,675
Kilroy Realty L.P. [Member] | Common units [Member]
Summary of shares and units
Noncontrolling common units (in units)	1,150,574	2,023,287

XML

Partners' Capital of the Operating Partnership - Narrative (Details) - USD ($) $ in Thousands		1 Months Ended	12 Months Ended
	Mar. 25, 2020	Jul. 31, 2019	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Mar. 31, 2020
Class of Stock [Line Items]
Common stock, shares issued (in shares)			116,035,827	106,016,287
Aggregate net proceeds after selling commissions			$ 721,665	$ 353,722	$ 130,693
Forward Equity Sale [Member]
Class of Stock [Line Items]
Aggregate net proceeds after selling commissions		$ 354,300
Forward Equity Sale [Member] | Common Stock [Member]
Class of Stock [Line Items]
Common stock, shares issued (in shares)	5,750,000	5,000,000				5,750,000
Aggregate net proceeds after selling commissions	$ 474,900	$ 354,300
Common units (in units)		5,000,000				5,750,000

XML

Partners' Capital of the Operating Partnership - At-The-Market Stock Offering, Common Units and Accrued Distributions (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Class of Stock [Line Items]
Aggregate net proceeds after selling commissions	$ 721,665	$ 353,722	$ 130,693
Accrued distributions
Accrued dividends and distributions	59,431	53,219
Common units [Member]
Accrued distributions
Accrued dividends and distributions	$ 575	981
Issuance of Equity under ATM Program [Member]
Class of Stock [Line Items]
Shares of common stock contributed by the Company (in shares)	3,147,110		1,817,195
Common units exchanged for shares of common stock by the Company (in units)	3,147,110		1,817,195
Aggregate gross proceeds	$ 252,000		$ 133,800
Aggregate net proceeds after selling commissions	247,300		132,100
Kilroy Realty L.P. [Member]
Class of Stock [Line Items]
Aggregate net proceeds after selling commissions	721,665	353,722	$ 130,693
Accrued distributions
Accrued dividends and distributions	59,431	53,219
Kilroy Realty L.P. [Member] | Restricted Stock Units (RSUs) [Member]
Accrued distributions
Accrued dividends and distributions	$ 838	$ 820
RSUs (in shares)	1,638,026	1,651,905
Kilroy Realty L.P. [Member] | Market measure-based Restricted Stock Units (RSUs) [Member]
Accrued distributions
Number of RSUs outstanding (in shares)	873,709	932,675
Kilroy Realty L.P. [Member] | Partners Capital Common Unit [Member]
Accrued distributions
Accrued dividends and distributions	$ 59,431	$ 53,219
Kilroy Realty L.P. [Member] | Partners capital general partner [Member]
Accrued distributions
Accrued dividends and distributions	58,018	51,418
Kilroy Realty L.P. [Member] | Partners capital limited partner [Member]
Accrued distributions
Accrued dividends and distributions	$ 575	$ 981
Kilroy Realty L.P. [Member] | Common units [Member]
Summary of units
Company owned common units in the Operating Partnership (in units)	116,035,827	106,016,287
Noncontrolling common units (in units)	1,150,574	2,023,287
Operating Partnership [Member]
Summary of units
Company owned general partnership interest	99.00%	98.10%
Operating Partnership [Member] | Non-Affiliated Investors [Member]
Summary of units
Ownership interest of noncontrolling interest	1.00%	1.90%

XML

Share-Based and Other Compensation - Stockholder Approved Share-Based Incentive Compensation Plan (Details) shares in Millions	Dec. 31, 2020 shares
Kilroy Realty 2006 Incentive Award Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation arrangement by share-based payment award, number of shares available for grant	1.5
Shareholder Meeting Date May 21, 2015 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation arrangement by share-based payment award, number of shares requested	10.7

XML

Share-Based and Other Compensation - Share-Based Compensation Grants (Details) - shares					1 Months Ended			2 Months Ended	12 Months Ended
	Jan. 31, 2020	Feb. 01, 2019	Dec. 27, 2018	Feb. 14, 2018	Jan. 31, 2020	Feb. 28, 2019	Dec. 31, 2018	Feb. 28, 2018	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)					263,626
Restricted Stock Units (RSUs) [Member] | Executive officer share-based compensation programs [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)			161,290			288,378		282,038
Restricted Stock Units (RSUs) [Member] | Chief Executive Officer [Member] | Executive officer share-based compensation programs [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)			483,871
Market measure-based Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)					154,267
Market measure-based Restricted Stock Units (RSUs) [Member] | Executive officer share-based compensation programs [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)	154,267	143,396	80,647	158,205
Market measure-based Restricted Stock Units (RSUs) [Member] | Chief Executive Officer [Member] | Executive officer share-based compensation programs [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)			266,130
Time-Based Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)					109,359
Time-Based Restricted Stock Units (RSUs) [Member] | Executive officer share-based compensation programs [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)			80,643			144,982		123,833			14,999
Forfeited in period (in shares)									5,148	10,733
Time-Based Restricted Stock Units (RSUs) [Member] | Chief Executive Officer [Member] | Executive officer share-based compensation programs [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)			217,741
Performance-Based RSUs [Member] | Executive officer share-based compensation programs [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Forfeited in period (in shares)									12,263	24,353
December 2018 Market-Based RSUs [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)							346,777
December 2018 Market-Based RSUs [Member] | Executive officer share-based compensation programs [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)						143,396		158,205
Time-Based Restricted Stock Units (RSUs), 2018 Special Time-Based RSU Grant [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)			298,384
Time-Based Restricted Stock Units (RSUs), 2018 Special Time-Based RSU Grant [Member] | Executive officer share-based compensation programs [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Forfeited in period (in shares)									6,441	98,844

XML

Share-Based and Other Compensation - 2018 Special Market-Based RSU Grant (Details) - USD ($) $ / shares in Units, $ in Millions		1 Months Ended
	Dec. 27, 2018	Dec. 31, 2018
December 2018 Market-Based RSUs [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)		346,777
Award vesting period		3 years
Vesting criteria, one (percent)		75.00%
Vesting criteria, two (percent)		25.00%
Fair value RSUs granted	$ 23.8
Fair value per share on valuation date (in dollars per share)	$ 68.66
Expected share price volatility (in dollars per share)	23.00%
Risk-free interest rate	2.40%
December 2018 Market-Based RSUs, TSR [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period		4 years
Minimum [Member] | December 2018 Market-Based RSUs [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Target percent		0.00%
Maximum [Member] | December 2018 Market-Based RSUs [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Target percent		200.00%

XML

Share-Based and Other Compensation - Annual Performance-Based RSU Grants (Details) - USD ($) $ / shares in Units, $ in Millions					1 Months Ended	12 Months Ended
	Jan. 31, 2020	Feb. 01, 2019	Dec. 27, 2018	Feb. 14, 2018	Jan. 31, 2020	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Performance-Based RSUs [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period						3 years	3 years	3 years
Vesting criteria, one (percent)						100.00%	100.00%	100.00%
Vesting criteria, two (percent)						50.00%	50.00%	50.00%
Vesting criteria, three (percent)						50.00%	50.00%	50.00%
Performance-based RSUs achievement target, participant one, percent						100.00%	175.00%	219.00%
Performance-based RSUs achievement target, all other participants, percent							150.00%	175.00%
Fair value RSUs granted	$ 12.9	$ 10.2		$ 10.8
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract]
Fair value per share on valuation date (in dollars per share)	$ 84.54
Expected share price volatility (in dollars per share)	17.00%
Risk-free interest rate	1.35%
2019 Performance-Based RSUs [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract]
Fair value per share on valuation date (in dollars per share)		$ 72.57
2018 Performance-Based RSUs [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract]
Fair value per share on valuation date (in dollars per share)				$ 70.08
Expected share price volatility (in dollars per share)		19.00%		20.00%
Risk-free interest rate		2.48%		2.37%
Market measure-based Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)					154,267
Estimated RSUs earned based on FFO (in shares)	142,004				142,004
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract]
Fair value per share on valuation date (in dollars per share)						$ 85.08
Executive officer share-based compensation programs [Member] | Market measure-based Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)	154,267	143,396	80,647	158,205
Market measure-based RSU estimate of probable [Member] | Performance-Based RSUs [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Estimated RSUs earned based on FFO (in shares)						142,004
Target level of achievement, one (percent)						100.00%
Market measure-based RSU estimate of probable [Member] | 2019 Performance-Based RSUs [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Estimated RSUs earned based on FFO (in shares)						220,151
Market measure-based RSU estimate of probable [Member] | Market measure-based Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Estimated RSUs earned based on FFO (in shares)		220,151		229,748

XML

Share-Based and Other Compensation - Annual Time-Based RSU Grants (Details) $ / shares in Units, $ in Millions						1 Months Ended	2 Months Ended
	Jan. 31, 2020 property $ / shares	Feb. 01, 2019 USD ($) property $ / shares	Dec. 27, 2018 USD ($) $ / shares	Feb. 14, 2018 $ / shares shares	Jan. 29, 2018 $ / shares shares	Jan. 31, 2020 USD ($) $ / shares	Feb. 28, 2018 USD ($) property participant	Dec. 31, 2020 shares	Dec. 31, 2018
Time-Based Restricted Stock Units (RSUs), 2020 Time-Based RSU Grant [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of equal annual vesting installments | property	3
Fair value RSUs granted | $						$ 9.0
Fair value per share (in dollars per share) | $ / shares	$ 82.57					$ 82.57
Time-Based Restricted Stock Units (RSUs), 2019 Time-Based RSU Grant [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of equal annual vesting installments | property		3
Fair value RSUs granted | $		$ 10.1
Fair value per share (in dollars per share) | $ / shares		$ 69.89
December 2018 Time-Based RSU Grant [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting criteria, one (percent)									50.00%
Vesting criteria, two (percent)									50.00%
Fair value RSUs granted | $			$ 18.5
Fair value per share (in dollars per share) | $ / shares			$ 62.00
Time-Based Restricted Stock Units (RSUs), 2018 Time-Based RSU Grant [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of equal annual vesting installments | property							3
Number of participants with shorter service period | participant							1
Fair value RSUs granted | $							$ 8.4
Fair value per share (in dollars per share) | $ / shares				$ 66.46	$ 70.37
RSUs granted (in units) | shares				67,818	56,015
Time-Based Restricted Stock Units (RSUs) with Accelerated Vesting due to Separation of Employment [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
RSUs (in shares) | shares								54,735

XML

Share-Based and Other Compensation - Summary of Market-Measure Based RSUs (Details) - $ / shares	1 Months Ended	12 Months Ended
	Jan. 31, 2020	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Award vesting period		3 years
Market measure-based Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Granted (in shares)	154,267
Vested (in shares)		(270,054)	(265,737)	(265,918)
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract]
RSU weighted average fair value, beginning balance (in dollars per share)	$ 71.04	$ 71.04
Fair value per share on valuation date (in dollars per share)		85.08
Weighted average grant date fair value, vested (in dollars per share)		74.71
Weighted average fair value, issuance of dividend equivalents (in dollars per share)		62.21
Weighted average fair value, forfeited (in dollars per share)		84.54
RSU weighted average fair value, ending balance (in dollars per share)		$ 72.06	$ 71.04
Market measure-based Restricted Stock Units (RSUs) [Member] | Nonvested Restricted Stock Units RSU [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Number of RSUs outstanding, beginning balance (in shares)	932,675	932,675
Granted (in shares)		154,267	231,191	601,012
Vested (in shares)		(230,334)
Issuance of dividend equivalents (in shares)		29,561
Forfeited (in shares)		(12,460)
Number of RSUs outstanding, ending balance (in shares)		873,709	932,675
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract]
Fair value per share on valuation date (in dollars per share)		$ 85.08	$ 71.12	$ 68.51
Market measure-based Restricted Stock Units (RSUs) [Member] | Vested Restricted Stock Units R S U [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Vested RSUs, beginning balance (in shares)	36,679	36,679
Granted (in shares)		38,313
Vested (in shares)		(230,334)
Settled (in shares)		(259,954)
Issuance of dividend equivalents (in shares)		1,407
Forfeited (in shares)		(4)
Vested RSUs, ending balance (in shares)		46,775	36,679
Market measure-based Restricted Stock Units (RSUs) [Member] | Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Total RSUs, beginning balance (in shares)	969,354	969,354
Granted (in shares)		192,580
Vested (in shares)		0
Settled (in shares)		(259,954)
Issuance of dividend equivalents (in shares)		30,968
Forfeited (in shares)		(12,464)
Total RSUs, ending balance (in shares)		920,484	969,354
Kilroy Realty 2006 Incentive Award Plan [Member] | Market measure-based Restricted Stock Units (RSUs) [Member] | Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Settled (in shares)		(125,928)

XML

Share-Based and Other Compensation - Market-Measure Based RSUs (Details) - Market measure-based Restricted Stock Units (RSUs) [Member] - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended	12 Months Ended
	Jan. 31, 2020	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares)	154,267
Fair value per share on valuation date (in dollars per share)		$ 85.08
Vested (in shares)		(270,054)	(265,737)	(265,918)
Nonvested Restricted Stock Units RSU [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares)		154,267	231,191	601,012
Fair value per share on valuation date (in dollars per share)		$ 85.08	$ 71.12	$ 68.51
Vested (in shares)		(230,334)
Vested Restricted Stock Units RSU [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares)		38,313
Vested (in shares)		(230,334)
Total Fair Value at Vest Date		$ 19,471	$ 18,703	$ 18,906

XML

Share-Based and Other Compensation - Summary of Time-Based RSUs (Details) - Time-Based Restricted Stock Units (RSUs) [Member] - $ / shares	1 Months Ended	12 Months Ended
	Jan. 31, 2020	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Granted (in shares)	109,359
Vested (in shares)		208,608	182,219	214,131
Nonvested Restricted Stock Units RSU [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Number of RSUs outstanding, beginning balance (in shares)	543,848	543,848
Granted (in shares)		120,769	153,005	437,216
Vested (in shares)		173,796
Issuance of dividend equivalents (in shares)		15,523
Forfeited (in shares)		(11,979)
Number of RSUs outstanding, ending balance (in shares)		494,365	543,848
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract]
RSU weighted average fair value, beginning balance (in dollars per share)	$ 66.66	$ 66.66
Fair value per share on valuation date (in dollars per share)		79.74	$ 70.31	$ 64.21
Weighted average grant date fair value, vested (in dollars per share)		70.83
Weighted average fair value, issuance of dividend equivalents (in dollars per share)		61.80
Weighted average fair value, forfeited (in dollars per share)		77.58
RSU weighted average fair value, ending balance (in dollars per share)		$ 67.97	$ 66.66
Vested Restricted Stock Units RSU [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Vested RSUs, beginning balance (in shares)	1,071,378	1,071,378
Granted (in shares)		0
Vested (in shares)		173,796
Settled (in shares)		(181,462)
Issuance of dividend equivalents (in shares)		34,812
Forfeited (in shares)		0
Canceled (in shares)		(1,638)
Vested RSUs, ending balance (in shares)		1,096,886	1,071,378
Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Total RSUs, beginning balance (in shares)	1,615,226	1,615,226
Granted (in shares)		120,769
Vested (in shares)		0
Settled (in shares)		(181,462)
Issuance of dividend equivalents (in shares)		50,335
Forfeited (in shares)		(11,979)
Canceled (in shares)		(1,638)
Total RSUs, ending balance (in shares)		1,591,251	1,615,226
Kilroy Realty 2006 Incentive Award Plan [Member] | Vested Restricted Stock Units RSU [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Settled (in shares)		(67,316)

XML

Share-Based and Other Compensation - Time-Based RSUs (Details) - Time-Based Restricted Stock Units (RSUs) [Member] - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended	12 Months Ended
	Jan. 31, 2020	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares)	109,359
Vested (in shares)		(208,608)	(182,219)	(214,131)
Nonvested Restricted Stock Units RSU [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares)		120,769	153,005	437,216
Fair value per share on valuation date (in dollars per share)		$ 79.74	$ 70.31	$ 64.21
Vested (in shares)		(173,796)
Vested Restricted Stock Units RSU [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares)		0
Vested (in shares)		(173,796)
Total Fair Value at Vest Date		$ 15,066	$ 12,227	$ 14,768

XML

Share-Based and Other Compensation - Time-Based Restricted Stock Unit Activity (Details) - Time-Based Restricted Stock Units (RSUs) [Member] - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended	12 Months Ended
	Jan. 31, 2020	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares)	109,359
Vested (in shares)		(208,608)	(182,219)	(214,131)
Nonvested Restricted Stock Units RSU [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares)		120,769	153,005	437,216
Fair value per share on valuation date (in dollars per share)		$ 79.74	$ 70.31	$ 64.21
Vested (in shares)		(173,796)
Vested Restricted Stock Units RSU [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares)		0
Vested (in shares)		(173,796)
Total Fair Value at Vest Date		$ 15,066	$ 12,227	$ 14,768

XML

Share-Based and Other Compensation - Nonvested Restricted Stock (Details) - Restricted Stock [Member] $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2018 USD ($) $ / shares shares
Nonvested Restricted Stock Units RSU [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares)	0
Fair value per share on valuation date (in dollars per share) | $ / shares	$ 0
Vested Restricted Stock Units RSU [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vested (in shares)	(22,884)
Total Fair Value at Vest Date | $	$ 1,652

XML

Share-Based and Other Compensation - Share-Based Compensation Cost Recorded During the Period and Other Compensation (Details) $ in Millions	12 Months Ended
	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)	Dec. 27, 2018 USD ($) age
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Allocated share-based compensation expense	$ 37.6	$ 32.8	$ 35.9
Share-based compensation costs	7.4	5.8	8.0
Unrecognized compensation costs	$ 35.1
Cost not yet recognized, period for recognition	1 year 4 months 24 days
General and Administrative Expense [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Severance costs	$ 14.1
Severance [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Allocated share-based compensation expense	4.5
Chief Executive Officer [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Cash retirement benefit, scenario one				$ 13.2
Cash retirement benefit, scenario two				$ 16.2
Retirement age | age				73
Compensation expense	$ 1.5	$ 1.5	$ 12.1

XML

Employee Benefit Plans - Narrative (Details) - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2007
Retirement Benefits [Abstract]
Eligibility period for 401K savings plan, period	3 months
401(k) plan, maximum participant deferral percent	60.00%
401(k) plan, employer match per dollar of participant contribution	$ 0.50
401(k) plan, maximum employer match percentage	10.00%
401(k) plan, contributions made	$ 1,600,000	$ 1,600,000	$ 1,500,000
Deferred Compensation, maximum participant deferral percent				70.00%
Deferred Compensation, maximum director fees and bonuses that may be deferred (percent)				100.00%
Deferred Compensation, mandatory Company contributions as percentage of gross monthly salary (percent)				10.00%
Deferred Compensation, liability under Plan	$ 27,400,000	$ 27,000,000.0

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Rental Income and Future Minimum Rent - Allocation of Rental Income (Details) - USD ($) $ in Thousands		12 Months Ended
	Jan. 01, 2020	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Leases [Abstract]
Fixed lease payments		$ 786,860	$ 708,362
Variable lease payments		124,443	115,915
Net collectability (reversals) recoveries		(18,997)	2,195
Total rental income		892,306	$ 826,472	$ 656,631
Write-off or revenue, as a result of the COVID-19 pandemic		18,400
Allowance for doubtful accounts, as a result of the COVID-19 pandemic		$ 600
Net collectability (reversals), transitioned to a cash basis of reporting	$ 2,200

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Rental Income and Future Minimum Rent - Future Contractual Minimum Rent (Details) $ in Thousands	Dec. 31, 2020 USD ($)
Future contractual minimum rent under operating lease
2021	$ 731,169
2022	804,488
2023	788,214
2024	750,051
2025	719,274
Thereafter	3,455,201
Total	$ 7,248,397

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Commitments and Contingencies - Narrative (Details) $ in Millions	12 Months Ended
	Dec. 31, 2020 USD ($) ground_lease	Dec. 31, 2019 USD ($)
Long-term Purchase Commitment [Line Items]
Commitments for contracts and executed leases, operating and redevelopment and development properties	$ 614.9
Weighted average discount rate	5.11%
Weighted average remaining lease term	54 years
Variable lease, cost	$ 3.0	$ 2.9
Period after which ground lease rentals are adjusted based on fair market value and the Consumer Price Index	5 years
Annual ground lease rental obligations limit	$ 1.0
Duration of ground lease prior to increase five years	five years
Average annual percentage rent for previous five years (percent)	50.00%
Duration of ground lease prior to increase ten years	10 years
Average annual percentage rent for previous ten years (percent)	60.00%
Ground lease fixed ground rent increase, percent	5.00%
Ten year ground lease extension option [Member]
Long-term Purchase Commitment [Line Items]
Number of extension options | ground_lease	3
Ground lease extension option term	10 years
Forty-five year ground lease extension option [Member]
Long-term Purchase Commitment [Line Items]
Number of extension options | ground_lease	1
Ground lease extension option term	45 years
Environmental matters [Member]
Long-term Purchase Commitment [Line Items]
Accrued environmental remediation liabilities	$ 71.3	$ 80.7

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Commitments and Contingencies - Minimum Commitment Under Ground Leases (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019	Jan. 01, 2019
Minimum commitment under our ground leases
2021	$ 5,641
2022	5,642
2023	5,662
2024	5,662
2025	5,662
Thereafter	280,723
Total	308,992
Present value discount	(211,214)
Ground lease liabilities	$ 97,778	$ 98,400	$ 98,349

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Fair Value Measurements and Disclosures - Assets and Liabilities Reported at Fair Value (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Fair value adjustment of marketable securities and deferred compensation plan liability
Net gain (loss) on marketable securities	$ 2,864	$ 3,885	$ (1,851)
Fair value, measurements, recurring [Member] | Fair Value (Level 1) [Member]
Assets and Liabilities Reported at Fair Value
Marketable securities	$ 27,481	$ 27,098

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Fair Value Measurements and Disclosures - Financial Instruments Disclosed at Fair Value (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Carrying value [Member] | Secured debt [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Debt instrument, fair value disclosure	$ 253,582	$ 258,593
Carrying value [Member] | Unsecured debt [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Debt instrument, fair value disclosure	3,670,099	3,049,185
Carrying value [Member] | Unsecured line of credit [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Debt instrument, fair value disclosure	0	245,000
Fair value [Member] | Secured debt [Member] | Fair value (Level 2) [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Debt instrument, fair value disclosure	282,559	272,997
Fair value [Member] | Unsecured debt [Member] | Fair value (Level 2) [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Debt instrument, fair value disclosure	4,089,339	3,252,217
Fair value [Member] | Unsecured line of credit [Member] | Fair value (Level 2) [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Debt instrument, fair value disclosure	$ 0	$ 245,195

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Net Income Available to Common Stockholders Per Share of the Company - Basic and Diluted Net Income Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Numerator:
Net income attributable to common stockholders									$ 187,105	$ 195,443	$ 258,415
Allocation to participating securities									(2,229)	(2,119)	(2,004)
Numerator for basic and diluted net income available to common stockholders									$ 184,876	$ 193,324	$ 256,411
Denominator:
Basic weighted average vested shares/units outstanding (in shares/units)									113,241,341	103,200,568	99,972,359
Effect of dilutive securities (in shares)									478,281	648,600	510,006
Diluted weighted average vested shares and common stock/ unit equivalents outstanding (in shares/units)									113,719,622	103,849,168	100,482,365
Basic earnings per share:
Net income available to common stockholders per share - basic (in dollars per share)	$ 0.67	$ 0.42	$ 0.17	$ 0.37	$ 0.68	$ 0.41	$ 0.41	$ 0.36	$ 1.63	$ 1.87	$ 2.56
Diluted earnings per share:
Net income available to common stockholders per share - diluted (in dollars per share)	$ 0.67	$ 0.42	$ 0.17	$ 0.37	$ 0.67	$ 0.41	$ 0.41	$ 0.36	$ 1.63	$ 1.86	$ 2.55

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Net Income Available to Common Unitholders Per Unit of the Operating Partnership - Basic and Diluted Net Income Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Numerator:
Net income attributable to common unitholders									$ 187,105	$ 195,443	$ 258,415
Allocation to participating securities									(2,229)	(2,119)	(2,004)
Numerator for basic and diluted net income available to common stockholders									$ 184,876	$ 193,324	$ 256,411
Denominator:
Basic weighted average vested shares/units outstanding (in shares/units)									113,241,341	103,200,568	99,972,359
Effect of dilutive securities (in units)									478,281	648,600	510,006
Diluted weighted average vested shares and common stock/ unit equivalents outstanding (in shares/units)									113,719,622	103,849,168	100,482,365
Basic earnings per unit:
Net income available to common unitholders per unit - basic (in dollars per unit)	$ 0.67	$ 0.42	$ 0.17	$ 0.37	$ 0.68	$ 0.41	$ 0.41	$ 0.36	$ 1.63	$ 1.87	$ 2.56
Diluted earnings per unit:
Net income available to common unitholders per unit - diluted (in dollars per unit)	0.67	0.42	0.17	0.37	0.67	0.41	0.41	0.36	$ 1.63	$ 1.86	$ 2.55
Kilroy Realty L.P. [Member]
Numerator:
Net income attributable to common unitholders									$ 189,609	$ 198,738	$ 263,210
Allocation to participating securities									(2,229)	(2,119)	(2,004)
Numerator for basic and diluted net income available to common stockholders									$ 187,380	$ 196,619	$ 261,206
Denominator:
Basic weighted average vested shares/units outstanding (in shares/units)									115,095,506	105,223,975	102,025,276
Effect of dilutive securities (in units)									478,281	648,600	510,006
Diluted weighted average vested shares and common stock/ unit equivalents outstanding (in shares/units)									115,573,787	105,872,575	102,535,282
Basic earnings per unit:
Net income available to common unitholders per unit - basic (in dollars per unit)	0.67	0.42	0.16	0.37	0.68	0.41	0.41	0.36	$ 1.63	$ 1.87	$ 2.56
Diluted earnings per unit:
Net income available to common unitholders per unit - diluted (in dollars per unit)	$ 0.67	$ 0.42	$ 0.16	$ 0.36	$ 0.67	$ 0.41	$ 0.41	$ 0.36	$ 1.62	$ 1.86	$ 2.55

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Supplemental Cash Flow Information of the Company - Supplemental Cash Flow (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Jan. 01, 2019
SUPPLEMENTAL CASH FLOWS INFORMATION:
Cash paid for interest, net of capitalized interest of $75,852, $77,666, and $65,627 as of December 31, 2020, 2019 and 2018, respectively	$ 61,741	$ 43,607	$ 44,697
Capitalized interest	75,852	77,666	65,627
Cash paid for amounts included in the measurement of ground lease liabilities	5,744	5,224
Cash paid for amounts included in the measurement of ground lease liabilities			4,398
NON-CASH INVESTING TRANSACTIONS:
Accrual for expenditures for operating properties and development properties	189,161	162,654	158,626
Tenant improvements funded directly by tenants	11,592	10,268	13,968
Assumption of other assets and liabilities in connection with operating and development property acquisitions, net (Note 3)	0	10,267	40,624
Initial measurement of operating right of use ground lease assets (Notes 2, 3 and 18)	95,523	96,348		$ 96,272
Initial measurement of operating ground lease liabilities (Notes 2, 3 and 18)	97,778	98,400		$ 98,349
NON-CASH FINANCING TRANSACTIONS:
Accrual of dividends and distributions payable to common stockholders and common unitholders (Notes 13 and 27)	59,431	53,219	47,559
Exchange of common units of the Operating Partnership into shares of the Company’s common stock	$ 37,640	$ 78	$ 1,962

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Supplemental Cash Flow Information of the Company - Cash and Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents [Roll Forward]
Cash and cash equivalents	$ 731,991	$ 60,044	$ 51,604	$ 57,649
Restricted cash	91,139	16,300	119,430	9,149
Cash and cash equivalents and restricted cash	$ 823,130	$ 76,344	$ 171,034	$ 66,798

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Supplemental Cash Flow Information of the Operating Partnership - Supplemental Cash Flow (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Jan. 01, 2019
SUPPLEMENTAL CASH FLOWS INFORMATION:
Cash paid for interest, net of capitalized interest of $75,852, $77,666, and $65,627 as of December 31, 2020, 2019 and 2018, respectively	$ 61,741	$ 43,607	$ 44,697
Capitalized interest	75,852	77,666	65,627
Cash paid for amounts included in the measurement of ground lease liabilities	5,744	5,224
Cash paid for amounts included in the measurement of ground lease liabilities			4,398
NON-CASH INVESTING TRANSACTIONS:
Accrual for expenditures for operating properties and development properties	189,161	162,654	158,626
Tenant improvements funded directly by tenants	11,592	10,268	13,968
Assumption of accrued liabilities in connection with acquisitions (Note 3)	0	10,267	40,624
Initial measurement of operating right of use ground lease assets (Notes 2, 3 and 18)	95,523	96,348		$ 96,272
Initial measurement of operating ground lease liabilities (Notes 2, 3 and 18)	97,778	98,400		98,349
NON-CASH FINANCING TRANSACTIONS:
Accrual of distributions payable to common unitholders (Notes 14 and 27)	59,431	53,219	47,559
Kilroy Realty L.P. [Member]
SUPPLEMENTAL CASH FLOWS INFORMATION:
Cash paid for interest, net of capitalized interest of $75,852, $77,666, and $65,627 as of December 31, 2020, 2019 and 2018, respectively	61,741	43,607	44,697
Capitalized interest	75,852	77,666	65,627
Cash paid for amounts included in the measurement of ground lease liabilities	5,744	5,224
Cash paid for amounts included in the measurement of ground lease liabilities			4,398
NON-CASH INVESTING TRANSACTIONS:
Accrual for expenditures for operating properties and development properties	189,161	162,654	158,626
Tenant improvements funded directly by tenants	11,592	10,268	13,968
Assumption of accrued liabilities in connection with acquisitions (Note 3)	0	10,267	40,624
Initial measurement of operating right of use ground lease assets (Notes 2, 3 and 18)	95,523	96,348		96,272
Initial measurement of operating ground lease liabilities (Notes 2, 3 and 18)	97,778	98,400		$ 98,349
NON-CASH FINANCING TRANSACTIONS:
Accrual of distributions payable to common unitholders (Notes 14 and 27)	$ 59,431	$ 53,219	$ 47,559

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Supplemental Cash Flow Information of the Operating Partnership - Cash and Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents [Roll Forward]
Cash and cash equivalents	$ 731,991	$ 60,044	$ 51,604	$ 57,649
Restricted cash	91,139	16,300	119,430	9,149
Cash and cash equivalents and restricted cash	823,130	76,344	171,034	66,798
Kilroy Realty L.P. [Member]
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents [Roll Forward]
Cash and cash equivalents	731,991	60,044	51,604	57,649
Restricted cash	91,139	16,300	119,430	9,149
Cash and cash equivalents and restricted cash	$ 823,130	$ 76,344	$ 171,034	$ 66,798

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Tax Treatment of Distributions - Dividends (Details) - $ / shares	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Class of Stock [Line Items]
Dividends declared per common share (in dollars per share)	$ 1.97	$ 1.91	$ 1.79
Common Stock [Member]
Class of Stock [Line Items]
Dividends declared per common share (in dollars per share)	1.970	1.910	1.790
Less: Dividends declared in the current year and paid in the following year (in dollars per share)	(0.500)	(0.485)	(0.455)
Add: Dividends declared in the prior year and paid in the current year (in dollars per share)	0.485	0.455	0.425
Dividends paid per common share (in dollars per share)	$ 1.955	$ 1.880	$ 1.760

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Tax Treatment of Distributions - Dividends Tax Treatment (Details) - $ / shares	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Income Tax Treatment of Dividends Paid [Line Items]
Capital gains, federal statutory tax rate	20.00%
Common Stock [Member]
Income Tax Treatment of Dividends Paid [Line Items]
Dividends paid per common share (in dollars per share)	$ 1.955	$ 1.880	$ 1.760
Tax Treatment, Ordinary income [Member] | Common Stock [Member]
Income Tax Treatment of Dividends Paid [Line Items]
Dividends paid per common share (in dollars per share)	$ 1.474	$ 0.939	$ 1.474
Dividends paid per common share, percentage	75.40%	49.95%	83.73%
Tax Treatment, Qualified dividend [Member] | Common Stock [Member]
Income Tax Treatment of Dividends Paid [Line Items]
Dividends paid per common share (in dollars per share)	$ 0.002	$ 0.004	$ 0.003
Dividends paid per common share, percentage	0.12%	0.21%	0.19%
Tax Treatment, Return of capital [Member] | Common Stock [Member]
Income Tax Treatment of Dividends Paid [Line Items]
Dividends paid per common share (in dollars per share)	$ 0.162	$ 0.312	$ 0.275
Dividends paid per common share, percentage	8.30%	16.62%	15.64%
Tax Treatment, Capital gains [Member] | Common Stock [Member]
Income Tax Treatment of Dividends Paid [Line Items]
Dividends paid per common share (in dollars per share)	$ 0.275	$ 0.600	$ 0.008
Dividends paid per common share, percentage	14.05%	31.93%	0.44%
Tax Treatment, Unrecaptured section 1250 gains [Member] | Common Stock [Member]
Income Tax Treatment of Dividends Paid [Line Items]
Dividends paid per common share (in dollars per share)	$ 0.042	$ 0.025	$ 0
Dividends paid per common share, percentage	2.13%	1.29%	0.00%
Tax treatment [Member] | Common Stock [Member]
Income Tax Treatment of Dividends Paid [Line Items]
Dividends paid per common share (in dollars per share)	$ 1.955	$ 1.880	$ 1.760
Dividends paid per common share, percentage	100.00%	100.00%	100.00%

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Quarterly Financial Information of the Company (Unaudited) - Summarized Quarterly Financial Data (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Quarterly Financial Information Disclosure [Abstract]
Revenues	$ 229,332	$ 228,314	$ 219,423	$ 221,328	$ 220,235	$ 215,525	$ 200,492	$ 201,202	$ 898,397	$ 837,454	$ 747,298
Net income	83,452	54,071	24,352	45,418	77,922	48,298	47,215	41,794	207,293	215,229	277,926
Net income attributable to Kilroy Realty Corporation	78,642	49,028	19,618	39,817	72,500	43,846	42,194	36,903
Net income available to common stockholders	$ 78,642	$ 49,028	$ 19,618	$ 39,817	$ 72,500	$ 43,846	$ 42,194	$ 36,903	$ 187,105	$ 195,443	$ 258,415
Net income available to common stockholders per share/ unit—basic (dollars per share/ unit)	$ 0.67	$ 0.42	$ 0.17	$ 0.37	$ 0.68	$ 0.41	$ 0.41	$ 0.36	$ 1.63	$ 1.87	$ 2.56
Net income available to common stockholders per share/ unit—diluted (dollars per share/ unit)	$ 0.67	$ 0.42	$ 0.17	$ 0.37	$ 0.67	$ 0.41	$ 0.41	$ 0.36	$ 1.63	$ 1.86	$ 2.55

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Quarterly Financial Information of the Operating Partnership (Unaudited) - Summarized Quarterly Financial Data (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Effect of Fourth Quarter Events [Line Items]
Revenues	$ 229,332	$ 228,314	$ 219,423	$ 221,328	$ 220,235	$ 215,525	$ 200,492	$ 201,202	$ 898,397	$ 837,454	$ 747,298
Net income	83,452	54,071	24,352	45,418	77,922	48,298	47,215	41,794	207,293	215,229	277,926
Net income attributable to the Operating Partnership	78,642	49,028	19,618	39,817	72,500	43,846	42,194	36,903
Net income available to common stockholders	$ 78,642	$ 49,028	$ 19,618	$ 39,817	$ 72,500	$ 43,846	$ 42,194	$ 36,903	$ 187,105	$ 195,443	$ 258,415
Net income available to common stockholders per share/ unit—basic (dollars per share/ unit)	$ 0.67	$ 0.42	$ 0.17	$ 0.37	$ 0.68	$ 0.41	$ 0.41	$ 0.36	$ 1.63	$ 1.87	$ 2.56
Net income available to common stockholders per share/ unit—diluted (dollars per share/ unit)	$ 0.67	$ 0.42	$ 0.17	$ 0.37	$ 0.67	$ 0.41	$ 0.41	$ 0.36	$ 1.63	$ 1.86	$ 2.55
Kilroy Realty L.P. [Member]
Effect of Fourth Quarter Events [Line Items]
Revenues	$ 229,332	$ 228,314	$ 219,423	$ 221,328	$ 220,235	$ 215,525	$ 200,492	$ 201,202	$ 898,397	$ 837,454	$ 747,298
Net income	83,452	54,071	24,352	45,418	77,922	48,298	47,215	41,794	207,293	215,229	277,926
Net income attributable to the Operating Partnership	79,654	49,728	19,838	40,389	73,740	44,589	42,901	37,508
Net income available to common stockholders	$ 79,654	$ 49,728	$ 19,838	$ 40,389	$ 73,740	$ 44,589	$ 42,901	$ 37,508	$ 189,609	$ 198,738	$ 263,210
Net income available to common stockholders per share/ unit—basic (dollars per share/ unit)	$ 0.67	$ 0.42	$ 0.16	$ 0.37	$ 0.68	$ 0.41	$ 0.41	$ 0.36	$ 1.63	$ 1.87	$ 2.56
Net income available to common stockholders per share/ unit—diluted (dollars per share/ unit)	$ 0.67	$ 0.42	$ 0.16	$ 0.36	$ 0.67	$ 0.41	$ 0.41	$ 0.36	$ 1.62	$ 1.86	$ 2.55

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Subsequent Events - Narrative (Details) - USD ($) $ in Millions	Jan. 29, 2021	Jan. 15, 2021	Dec. 31, 2020
Kilroy Realty 2006 Incentive Award Plan [Member]
Subsequent Event [Line Items]
Share-based compensation arrangement by share-based payment award, number of shares available for grant			1,500,000
Subsequent event [Member]
Subsequent Event [Line Items]
Payments of dividends		$ 59.4
Subsequent event [Member] | Kilroy Realty 2006 Incentive Award Plan [Member] | Time-Based Restricted Stock Units (RSUs) [Member] | Chief Executive Officer [Member]
Subsequent Event [Line Items]
Share-based compensation arrangement by share-based payment award, number of shares available for grant	102,799
Subsequent event [Member] | Kilroy Realty 2006 Incentive Award Plan [Member] | Market measure-based Restricted Stock Units (RSUs) [Member] | Chief Executive Officer [Member]
Subsequent Event [Line Items]
Recognition period	3 years

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Schedule II - Valuation and Qualifying Accounts - Allowances (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward]
Notes receivable, valuation allowance	$ 1,700	$ 700	$ 2,900
Uncollectible tenant receivables [Member]
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward]
Balance at Beginning of Period	1,171	4,639	2,309
Balance, Beginning of Period, adjusted			512
Charged to Costs and Expenses	1,977	907	2,604
Deductions (3)	(1,349)	(248)	(274)
Balance at End of Period	1,799	1,171	4,639
Allowance for deferred rent [Member]
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward]
Balance at Beginning of Period	1,552	3,339	3,238
Balance, Beginning of Period, adjusted			195
Charged to Costs and Expenses	832	1,357	165
Deductions (3)	(1,580)	0	(64)
Balance at End of Period	$ 804	$ 1,552	$ 3,339

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Schedule III - Real Estate and Accumulated Depreciation - Schedule of Real Estate and Accumulated Depreciation (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2020 USD ($) ft²	Dec. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, encumbrances	$ 254,365
Initial cost, land and improvements	2,371,628
Initial cost, buildings and Improvements	2,699,959
Costs capitalized subsequent to acquisition/ improvement	5,118,459
Land and improvements, gross	2,503,621
Buildings and improvements, gross	7,686,425
Land and improvements and buildings and improvements, gross	10,190,046
Accumulated depreciation	$ 1,798,646	$ 1,561,361	$ 1,391,368	$ 1,264,162
Rentable square feet | ft²	14,620,166
3101-3243 S. La Cienega Blvd., Culver City, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 150,718
Initial cost, buildings and Improvements	31,033
Costs capitalized subsequent to acquisition/ improvement	227
Land and improvements, gross	150,718
Buildings and improvements, gross	31,259
Land and improvements and buildings and improvements, gross	181,977
Accumulated depreciation	$ 6,127
Depreciation life	35 years
Rentable square feet | ft²	151,908
2240 E. Imperial Highway, El Segundo, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 1,044
Initial cost, buildings and Improvements	11,763
Costs capitalized subsequent to acquisition/ improvement	29,551
Land and improvements, gross	1,048
Buildings and improvements, gross	41,310
Land and improvements and buildings and improvements, gross	42,358
Accumulated depreciation	$ 28,203
Depreciation life	35 years
Rentable square feet | ft²	122,870
2250 E. Imperial Highway, El Segundo, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 2,579
Initial cost, buildings and Improvements	29,062
Costs capitalized subsequent to acquisition/ improvement	36,311
Land and improvements, gross	2,547
Buildings and improvements, gross	65,405
Land and improvements and buildings and improvements, gross	67,952
Accumulated depreciation	$ 56,603
Depreciation life	35 years
Rentable square feet | ft²	298,728
2260 E. Imperial Highway, El Segundo, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 2,518
Initial cost, buildings and Improvements	28,370
Costs capitalized subsequent to acquisition/ improvement	36,781
Land and improvements, gross	2,547
Buildings and improvements, gross	65,122
Land and improvements and buildings and improvements, gross	67,669
Accumulated depreciation	$ 18,563
Depreciation life	35 years
Rentable square feet | ft²	298,728
909 N. Pacific Coast Highway, El Segundo, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 3,577
Initial cost, buildings and Improvements	34,042
Costs capitalized subsequent to acquisition/ improvement	51,773
Land and improvements, gross	3,577
Buildings and improvements, gross	85,815
Land and improvements and buildings and improvements, gross	89,392
Accumulated depreciation	$ 44,727
Depreciation life	35 years
Rentable square feet | ft²	244,136
999 N. Pacific Coast Highway, El Segundo, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 1,407
Initial cost, buildings and Improvements	34,326
Costs capitalized subsequent to acquisition/ improvement	17,295
Land and improvements, gross	1,407
Buildings and improvements, gross	51,621
Land and improvements and buildings and improvements, gross	53,028
Accumulated depreciation	$ 27,429
Depreciation life	35 years
Rentable square feet | ft²	128,588
1350 Ivar Ave., Los Angeles, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 1,575
Initial cost, buildings and Improvements	0
Costs capitalized subsequent to acquisition/ improvement	13,725
Land and improvements, gross	1,575
Buildings and improvements, gross	13,725
Land and improvements and buildings and improvements, gross	15,300
Accumulated depreciation	$ 65
Depreciation life	35 years
Rentable square feet | ft²	16,448
1355 Vine St., Los Angeles, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 17,588
Initial cost, buildings and Improvements	0
Costs capitalized subsequent to acquisition/ improvement	114,603
Land and improvements, gross	17,588
Buildings and improvements, gross	114,603
Land and improvements and buildings and improvements, gross	132,191
Accumulated depreciation	$ 549
Depreciation life	35 years
Rentable square feet | ft²	183,129
1375 Vine St., Los Angeles, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 15,578
Initial cost, buildings and Improvements	0
Costs capitalized subsequent to acquisition/ improvement	97,470
Land and improvements, gross	15,578
Buildings and improvements, gross	97,470
Land and improvements and buildings and improvements, gross	113,048
Accumulated depreciation	$ 461
Depreciation life	35 years
Rentable square feet | ft²	159,236
1395 Vine St., Los Angeles, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 278
Initial cost, buildings and Improvements	0
Costs capitalized subsequent to acquisition/ improvement	3,138
Land and improvements, gross	278
Buildings and improvements, gross	3,138
Land and improvements and buildings and improvements, gross	3,417
Accumulated depreciation	$ 16
Depreciation life	35 years
Rentable square feet | ft²	2,575
6115 W. Sunset Blvd., Los Angeles, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 1,313
Initial cost, buildings and Improvements	3
Costs capitalized subsequent to acquisition/ improvement	16,454
Land and improvements, gross	2,455
Buildings and improvements, gross	15,315
Land and improvements and buildings and improvements, gross	17,770
Accumulated depreciation	$ 2,787
Depreciation life	35 years
Rentable square feet | ft²	26,105
6121 W. Sunset Blvd., Los Angeles, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 11,120
Initial cost, buildings and Improvements	4,256
Costs capitalized subsequent to acquisition/ improvement	43,983
Land and improvements, gross	8,703
Buildings and improvements, gross	50,656
Land and improvements and buildings and improvements, gross	59,359
Accumulated depreciation	$ 8,894
Depreciation life	35 years
Rentable square feet | ft²	91,173
1525 N. Gower Street, Los Angeles, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 1,318
Initial cost, buildings and Improvements	3
Costs capitalized subsequent to acquisition/ improvement	9,641
Land and improvements, gross	1,318
Buildings and improvements, gross	9,645
Land and improvements and buildings and improvements, gross	10,962
Accumulated depreciation	$ 1,542
Depreciation life	35 years
Rentable square feet | ft²	9,610
1575 N. Gower Street, Los Angeles, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 22,153
Initial cost, buildings and Improvements	51
Costs capitalized subsequent to acquisition/ improvement	119,496
Land and improvements, gross	22,153
Buildings and improvements, gross	119,547
Land and improvements and buildings and improvements, gross	141,700
Accumulated depreciation	$ 15,482
Depreciation life	35 years
Rentable square feet | ft²	251,245
1500 N. El Centro Avenue, Los Angeles, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 9,235
Initial cost, buildings and Improvements	21
Costs capitalized subsequent to acquisition/ improvement	58,988
Land and improvements, gross	9,235
Buildings and improvements, gross	59,009
Land and improvements and buildings and improvements, gross	68,244
Accumulated depreciation	$ 12,666
Depreciation life	35 years
Rentable square feet | ft²	104,504
1550 N. El Centro Avenue, Los Angeles, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 16,970
Initial cost, buildings and Improvements	39
Costs capitalized subsequent to acquisition/ improvement	136,137
Land and improvements, gross	16,970
Buildings and improvements, gross	136,176
Land and improvements and buildings and improvements, gross	153,146
Accumulated depreciation	$ 17,894
Depreciation life	35 years
Rentable square feet | ft²	0
6255 W. Sunset Blvd., Los Angeles, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 18,111
Initial cost, buildings and Improvements	60,320
Costs capitalized subsequent to acquisition/ improvement	49,265
Land and improvements, gross	18,111
Buildings and improvements, gross	109,585
Land and improvements and buildings and improvements, gross	127,696
Accumulated depreciation	$ 41,735
Depreciation life	35 years
Rentable square feet | ft²	323,920
3750 Kilroy Airport Way, Long Beach, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 0
Initial cost, buildings and Improvements	1,941
Costs capitalized subsequent to acquisition/ improvement	13,113
Land and improvements, gross	0
Buildings and improvements, gross	15,054
Land and improvements and buildings and improvements, gross	15,054
Accumulated depreciation	$ 11,247
Depreciation life	35 years
Rentable square feet | ft²	10,718
3760 Kilroy Airport Way, Long Beach, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 0
Initial cost, buildings and Improvements	17,467
Costs capitalized subsequent to acquisition/ improvement	16,687
Land and improvements, gross	0
Buildings and improvements, gross	34,154
Land and improvements and buildings and improvements, gross	34,154
Accumulated depreciation	$ 28,166
Depreciation life	35 years
Rentable square feet | ft²	166,761
3780 Kilroy Airport Way, Long Beach, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 0
Initial cost, buildings and Improvements	22,319
Costs capitalized subsequent to acquisition/ improvement	31,855
Land and improvements, gross	0
Buildings and improvements, gross	54,174
Land and improvements and buildings and improvements, gross	54,174
Accumulated depreciation	$ 41,573
Depreciation life	35 years
Rentable square feet | ft²	221,452
3800 Kilroy Airport Way, Long Beach, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 0
Initial cost, buildings and Improvements	19,408
Costs capitalized subsequent to acquisition/ improvement	22,252
Land and improvements, gross	0
Buildings and improvements, gross	41,660
Land and improvements and buildings and improvements, gross	41,660
Accumulated depreciation	$ 26,473
Depreciation life	35 years
Rentable square feet | ft²	192,476
3840 Kilroy Airport Way, Long Beach, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 0
Initial cost, buildings and Improvements	13,586
Costs capitalized subsequent to acquisition/ improvement	11,755
Land and improvements, gross	0
Buildings and improvements, gross	25,341
Land and improvements and buildings and improvements, gross	25,341
Accumulated depreciation	$ 16,793
Depreciation life	35 years
Rentable square feet | ft²	136,026
3880 Kilroy Airport Way, Long Beach, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 0
Initial cost, buildings and Improvements	9,704
Costs capitalized subsequent to acquisition/ improvement	11,827
Land and improvements, gross	0
Buildings and improvements, gross	21,531
Land and improvements and buildings and improvements, gross	21,531
Accumulated depreciation	$ 5,220
Depreciation life	35 years
Rentable square feet | ft²	96,923
3900 Kilroy Airport Way, Long Beach, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 0
Initial cost, buildings and Improvements	12,615
Costs capitalized subsequent to acquisition/ improvement	13,208
Land and improvements, gross	0
Buildings and improvements, gross	25,823
Land and improvements and buildings and improvements, gross	25,823
Accumulated depreciation	$ 19,261
Depreciation life	35 years
Rentable square feet | ft²	130,935
Kilroy Airport Center, Phase IV, Long Beach, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 0
Initial cost, buildings and Improvements	0
Costs capitalized subsequent to acquisition/ improvement	4,997
Land and improvements, gross	0
Buildings and improvements, gross	4,997
Land and improvements and buildings and improvements, gross	4,997
Accumulated depreciation	$ 4,997
Depreciation life	35 years
Rentable square feet | ft²	0
8560 W. Sunset Blvd, West Hollywood, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 9,720
Initial cost, buildings and Improvements	50,956
Costs capitalized subsequent to acquisition/ improvement	1,930
Land and improvements, gross	9,720
Buildings and improvements, gross	52,886
Land and improvements and buildings and improvements, gross	62,606
Accumulated depreciation	$ 8,351
Depreciation life	35 years
Rentable square feet | ft²	74,842
8570 W. Sunset Blvd, West Hollywood, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 31,693
Initial cost, buildings and Improvements	27,974
Costs capitalized subsequent to acquisition/ improvement	6,497
Land and improvements, gross	31,693
Buildings and improvements, gross	34,471
Land and improvements and buildings and improvements, gross	66,163
Accumulated depreciation	$ 4,121
Depreciation life	35 years
Rentable square feet | ft²	45,941
8580 W. Sunset Blvd, West Hollywood, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 10,013
Initial cost, buildings and Improvements	3,695
Costs capitalized subsequent to acquisition/ improvement	1,219
Land and improvements, gross	10,013
Buildings and improvements, gross	4,914
Land and improvements and buildings and improvements, gross	14,927
Accumulated depreciation	$ 523
Depreciation life	35 years
Rentable square feet | ft²	7,126
8590 W. Sunset Blvd, West Hollywood, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 39,954
Initial cost, buildings and Improvements	27,884
Costs capitalized subsequent to acquisition/ improvement	5,487
Land and improvements, gross	39,954
Buildings and improvements, gross	33,371
Land and improvements and buildings and improvements, gross	73,325
Accumulated depreciation	$ 4,473
Depreciation life	35 years
Rentable square feet | ft²	55,302
12100 W. Olympic Blvd., Los Angeles, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 352
Initial cost, buildings and Improvements	45,611
Costs capitalized subsequent to acquisition/ improvement	20,191
Land and improvements, gross	9,633
Buildings and improvements, gross	56,520
Land and improvements and buildings and improvements, gross	66,154
Accumulated depreciation	$ 30,836
Depreciation life	35 years
Rentable square feet | ft²	152,048
12200 W. Olympic Blvd., Los Angeles, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 4,329
Initial cost, buildings and Improvements	35,488
Costs capitalized subsequent to acquisition/ improvement	25,506
Land and improvements, gross	3,977
Buildings and improvements, gross	61,346
Land and improvements and buildings and improvements, gross	65,323
Accumulated depreciation	$ 42,135
Depreciation life	35 years
Rentable square feet | ft²	150,832
12233 Olympic Blvd., Los Angeles, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 22,100
Initial cost, buildings and Improvements	53,170
Costs capitalized subsequent to acquisition/ improvement	5,258
Land and improvements, gross	22,100
Buildings and improvements, gross	58,428
Land and improvements and buildings and improvements, gross	80,528
Accumulated depreciation	$ 16,326
Depreciation life	35 years
Rentable square feet | ft²	151,029
12312 W. Olympic Blvd., Los Angeles, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 3,325
Initial cost, buildings and Improvements	12,202
Costs capitalized subsequent to acquisition/ improvement	12,345
Land and improvements, gross	3,399
Buildings and improvements, gross	24,473
Land and improvements and buildings and improvements, gross	27,872
Accumulated depreciation	$ 14,923
Depreciation life	35 years
Rentable square feet | ft²	76,644
1633 26th St., Santa Monica, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 2,080
Initial cost, buildings and Improvements	6,672
Costs capitalized subsequent to acquisition/ improvement	4,006
Land and improvements, gross	2,040
Buildings and improvements, gross	10,718
Land and improvements and buildings and improvements, gross	12,758
Accumulated depreciation	$ 7,497
Depreciation life	35 years
Rentable square feet | ft²	43,857
2100/2110 Colorado Ave., Santa Monica, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 5,474
Initial cost, buildings and Improvements	26,087
Costs capitalized subsequent to acquisition/ improvement	14,915
Land and improvements, gross	5,476
Buildings and improvements, gross	41,000
Land and improvements and buildings and improvements, gross	46,476
Accumulated depreciation	$ 27,393
Depreciation life	35 years
Rentable square feet | ft²	102,864
3130 Wilshire Blvd., Santa Monica, [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 8,921
Initial cost, buildings and Improvements	6,579
Costs capitalized subsequent to acquisition/ improvement	17,147
Land and improvements, gross	9,188
Buildings and improvements, gross	23,459
Land and improvements and buildings and improvements, gross	32,647
Accumulated depreciation	$ 17,318
Depreciation life	35 years
Rentable square feet | ft²	90,074
501 Santa Monica Blvd., Santa Monica, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 4,547
Initial cost, buildings and Improvements	12,044
Costs capitalized subsequent to acquisition/ improvement	16,304
Land and improvements, gross	4,551
Buildings and improvements, gross	28,344
Land and improvements and buildings and improvements, gross	32,895
Accumulated depreciation	$ 19,067
Depreciation life	35 years
Rentable square feet | ft²	76,803
12225 El Camino Real, Del Mar, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 1,700
Initial cost, buildings and Improvements	9,633
Costs capitalized subsequent to acquisition/ improvement	3,864
Land and improvements, gross	1,673
Buildings and improvements, gross	13,524
Land and improvements and buildings and improvements, gross	15,197
Accumulated depreciation	$ 9,622
Depreciation life	35 years
Rentable square feet | ft²	58,401
12235 El Camino Real, Del Mar, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 1,507
Initial cost, buildings and Improvements	8,543
Costs capitalized subsequent to acquisition/ improvement	9,255
Land and improvements, gross	1,540
Buildings and improvements, gross	17,765
Land and improvements and buildings and improvements, gross	19,305
Accumulated depreciation	$ 11,193
Depreciation life	35 years
Rentable square feet | ft²	53,751
12340 El Camino Real, Del Mar, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 4,201
Initial cost, buildings and Improvements	13,896
Costs capitalized subsequent to acquisition/ improvement	12,195
Land and improvements, gross	4,201
Buildings and improvements, gross	26,091
Land and improvements and buildings and improvements, gross	30,292
Accumulated depreciation	$ 13,226
Depreciation life	35 years
Rentable square feet | ft²	89,272
12390 El Camino Real, Del Mar, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 3,453
Initial cost, buildings and Improvements	11,981
Costs capitalized subsequent to acquisition/ improvement	9,541
Land and improvements, gross	3,453
Buildings and improvements, gross	21,522
Land and improvements and buildings and improvements, gross	24,975
Accumulated depreciation	$ 10,742
Depreciation life	35 years
Rentable square feet | ft²	70,140
12348 High Bluff Dr., Del Mar, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 1,629
Initial cost, buildings and Improvements	3,096
Costs capitalized subsequent to acquisition/ improvement	6,890
Land and improvements, gross	1,629
Buildings and improvements, gross	9,986
Land and improvements and buildings and improvements, gross	11,615
Accumulated depreciation	$ 6,963
Depreciation life	35 years
Rentable square feet | ft²	39,193
12400 High Bluff Dr., Del Mar, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 15,167
Initial cost, buildings and Improvements	40,497
Costs capitalized subsequent to acquisition/ improvement	16,850
Land and improvements, gross	15,167
Buildings and improvements, gross	57,347
Land and improvements and buildings and improvements, gross	72,514
Accumulated depreciation	$ 30,685
Depreciation life	35 years
Rentable square feet | ft²	210,732
12770 El Camino Real, Del Mar, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 9,360
Initial cost, buildings and Improvements	0
Costs capitalized subsequent to acquisition/ improvement	34,212
Land and improvements, gross	9,360
Buildings and improvements, gross	34,212
Land and improvements and buildings and improvements, gross	43,572
Accumulated depreciation	$ 4,493
Depreciation life	35 years
Rentable square feet | ft²	73,032
12780 El Camino Real, Del Mar, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 18,398
Initial cost, buildings and Improvements	54,954
Costs capitalized subsequent to acquisition/ improvement	22,922
Land and improvements, gross	18,398
Buildings and improvements, gross	77,876
Land and improvements and buildings and improvements, gross	96,274
Accumulated depreciation	$ 18,909
Depreciation life	35 years
Rentable square feet | ft²	140,591
12790 El Camino Real, Del Mar, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 10,252
Initial cost, buildings and Improvements	21,236
Costs capitalized subsequent to acquisition/ improvement	8,485
Land and improvements, gross	10,252
Buildings and improvements, gross	29,721
Land and improvements and buildings and improvements, gross	39,973
Accumulated depreciation	$ 6,812
Depreciation life	35 years
Rentable square feet | ft²	78,836
12860 El Camino Real, Del Mar, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 0
Initial cost, buildings and Improvements	0
Costs capitalized subsequent to acquisition/ improvement	60,675
Land and improvements, gross	11,326
Buildings and improvements, gross	49,349
Land and improvements and buildings and improvements, gross	60,675
Accumulated depreciation	$ 602
Depreciation life	35 years
Rentable square feet | ft²	0
12830 El Camino Real, Del Mar, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 0
Initial cost, buildings and Improvements	0
Costs capitalized subsequent to acquisition/ improvement	134,776
Land and improvements, gross	28,645
Buildings and improvements, gross	106,131
Land and improvements and buildings and improvements, gross	134,776
Accumulated depreciation	$ 885
Depreciation life	35 years
Rentable square feet | ft²	0
3579 Valley Centre Dr., Del Mar, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 2,167
Initial cost, buildings and Improvements	6,897
Costs capitalized subsequent to acquisition/ improvement	9,559
Land and improvements, gross	2,858
Buildings and improvements, gross	15,765
Land and improvements and buildings and improvements, gross	18,623
Accumulated depreciation	$ 10,397
Depreciation life	35 years
Rentable square feet | ft²	54,960
3611 Valley Centre Dr., Del Mar, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 4,184
Initial cost, buildings and Improvements	19,352
Costs capitalized subsequent to acquisition/ improvement	25,934
Land and improvements, gross	5,259
Buildings and improvements, gross	44,212
Land and improvements and buildings and improvements, gross	49,470
Accumulated depreciation	$ 27,028
Depreciation life	35 years
Rentable square feet | ft²	130,109
3661 Valley Centre Dr., Del Mar, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 4,038
Initial cost, buildings and Improvements	21,144
Costs capitalized subsequent to acquisition/ improvement	18,897
Land and improvements, gross	4,725
Buildings and improvements, gross	39,354
Land and improvements and buildings and improvements, gross	44,079
Accumulated depreciation	$ 24,083
Depreciation life	35 years
Rentable square feet | ft²	128,364
3721 Valley Centre Dr., Del Mar, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 4,297
Initial cost, buildings and Improvements	18,967
Costs capitalized subsequent to acquisition/ improvement	14,973
Land and improvements, gross	4,254
Buildings and improvements, gross	33,983
Land and improvements and buildings and improvements, gross	38,237
Accumulated depreciation	$ 19,134
Depreciation life	35 years
Rentable square feet | ft²	115,193
3811 Valley Centre Dr., Del Mar, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 3,452
Initial cost, buildings and Improvements	16,152
Costs capitalized subsequent to acquisition/ improvement	20,540
Land and improvements, gross	4,457
Buildings and improvements, gross	35,687
Land and improvements and buildings and improvements, gross	40,144
Accumulated depreciation	$ 24,154
Depreciation life	35 years
Rentable square feet | ft²	112,067
3745 Paseo Place, Del Mar, CA (Retail) [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 24,358
Initial cost, buildings and Improvements	0
Costs capitalized subsequent to acquisition/ improvement	72,290
Land and improvements, gross	24,358
Buildings and improvements, gross	72,290
Land and improvements and buildings and improvements, gross	96,648
Accumulated depreciation	$ 4,435
Depreciation life	35 years
Rentable square feet | ft²	95,871
13280 Evening Creek Dr. South, I-15 Corridor, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 3,701
Initial cost, buildings and Improvements	8,398
Costs capitalized subsequent to acquisition/ improvement	4,818
Land and improvements, gross	3,701
Buildings and improvements, gross	13,216
Land and improvements and buildings and improvements, gross	16,917
Accumulated depreciation	$ 6,354
Depreciation life	35 years
Rentable square feet | ft²	41,196
13290 Evening Creek Dr. South, I-15 Corridor, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 5,229
Initial cost, buildings and Improvements	11,871
Costs capitalized subsequent to acquisition/ improvement	6,150
Land and improvements, gross	5,229
Buildings and improvements, gross	18,021
Land and improvements and buildings and improvements, gross	23,250
Accumulated depreciation	$ 7,665
Depreciation life	35 years
Rentable square feet | ft²	61,180
13480 Evening Creek Dr. South, I-15 Corridor, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 7,997
Initial cost, buildings and Improvements	0
Costs capitalized subsequent to acquisition/ improvement	52,581
Land and improvements, gross	7,997
Buildings and improvements, gross	52,581
Land and improvements and buildings and improvements, gross	60,578
Accumulated depreciation	$ 21,940
Depreciation life	35 years
Rentable square feet | ft²	154,157
13500 Evening Creek Dr. South, I-15 Corridor, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 7,581
Initial cost, buildings and Improvements	35,903
Costs capitalized subsequent to acquisition/ improvement	23,609
Land and improvements, gross	7,580
Buildings and improvements, gross	59,513
Land and improvements and buildings and improvements, gross	67,093
Accumulated depreciation	$ 24,861
Depreciation life	35 years
Rentable square feet | ft²	137,658
13520 Evening Creek Dr. South, I-15 Corridor, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 7,581
Initial cost, buildings and Improvements	35,903
Costs capitalized subsequent to acquisition/ improvement	19,454
Land and improvements, gross	7,580
Buildings and improvements, gross	55,358
Land and improvements and buildings and improvements, gross	62,938
Accumulated depreciation	$ 27,289
Depreciation life	35 years
Rentable square feet | ft²	146,701
2305 Historic Decatur Rd., Point Loma, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 5,240
Initial cost, buildings and Improvements	22,220
Costs capitalized subsequent to acquisition/ improvement	7,650
Land and improvements, gross	5,240
Buildings and improvements, gross	29,870
Land and improvements and buildings and improvements, gross	35,110
Accumulated depreciation	$ 12,291
Depreciation life	35 years
Rentable square feet | ft²	107,456
4690 Executive Dr., University Towne Centre, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 1,623
Initial cost, buildings and Improvements	7,926
Costs capitalized subsequent to acquisition/ improvement	3,725
Land and improvements, gross	1,623
Buildings and improvements, gross	11,651
Land and improvements and buildings and improvements, gross	13,274
Accumulated depreciation	$ 8,314
Depreciation life	35 years
Rentable square feet | ft²	47,846
Bohannon Drive 4100, Menlo Park, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 4,835
Initial cost, buildings and Improvements	15,526
Costs capitalized subsequent to acquisition/ improvement	932
Land and improvements, gross	4,860
Buildings and improvements, gross	16,433
Land and improvements and buildings and improvements, gross	21,293
Accumulated depreciation	$ 5,123
Depreciation life	35 years
Rentable square feet | ft²	47,379
Bohannon Drive 4200, Menlo Park, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 4,798
Initial cost, buildings and Improvements	15,406
Costs capitalized subsequent to acquisition/ improvement	3,967
Land and improvements, gross	4,662
Buildings and improvements, gross	19,509
Land and improvements and buildings and improvements, gross	24,171
Accumulated depreciation	$ 6,585
Depreciation life	35 years
Rentable square feet | ft²	45,451
Bohannon Drive 4300, Menlo Park, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 6,527
Initial cost, buildings and Improvements	20,958
Costs capitalized subsequent to acquisition/ improvement	5,373
Land and improvements, gross	6,470
Buildings and improvements, gross	26,387
Land and improvements and buildings and improvements, gross	32,858
Accumulated depreciation	$ 8,557
Depreciation life	35 years
Rentable square feet | ft²	63,079
Bohannon Drive 4400, Menlo Park, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 4,798
Initial cost, buildings and Improvements	15,406
Costs capitalized subsequent to acquisition/ improvement	3,331
Land and improvements, gross	4,939
Buildings and improvements, gross	18,597
Land and improvements and buildings and improvements, gross	23,535
Accumulated depreciation	$ 6,394
Depreciation life	35 years
Rentable square feet | ft²	48,146
Bohannon Drive 4500, Menlo Park, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 6,527
Initial cost, buildings and Improvements	20,957
Costs capitalized subsequent to acquisition/ improvement	3,811
Land and improvements, gross	6,470
Buildings and improvements, gross	24,825
Land and improvements and buildings and improvements, gross	31,295
Accumulated depreciation	$ 7,506
Depreciation life	35 years
Rentable square feet | ft²	63,078
Bohannon Drive 4600, Menlo Park, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 4,798
Initial cost, buildings and Improvements	15,406
Costs capitalized subsequent to acquisition/ improvement	4,025
Land and improvements, gross	4,939
Buildings and improvements, gross	19,290
Land and improvements and buildings and improvements, gross	24,229
Accumulated depreciation	$ 6,427
Depreciation life	35 years
Rentable square feet | ft²	48,147
Bohannon Drive 4700, Menlo Park, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 6,527
Initial cost, buildings and Improvements	20,958
Costs capitalized subsequent to acquisition/ improvement	1,584
Land and improvements, gross	6,470
Buildings and improvements, gross	22,599
Land and improvements and buildings and improvements, gross	29,069
Accumulated depreciation	$ 7,112
Depreciation life	35 years
Rentable square feet | ft²	63,078
1290-1300 Terra Bella Avenue, Mountain View, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 28,730
Initial cost, buildings and Improvements	27,555
Costs capitalized subsequent to acquisition/ improvement	61
Land and improvements, gross	28,730
Buildings and improvements, gross	27,616
Land and improvements and buildings and improvements, gross	56,346
Accumulated depreciation	$ 5,702
Depreciation life	35 years
Rentable square feet | ft²	114,175
680 E Middlefield Road, Mountain View, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 34,605
Initial cost, buildings and Improvements	0
Costs capitalized subsequent to acquisition/ improvement	56,522
Land and improvements, gross	34,605
Buildings and improvements, gross	56,522
Land and improvements and buildings and improvements, gross	91,127
Accumulated depreciation	$ 11,718
Depreciation life	35 years
Rentable square feet | ft²	170,090
690 E Middlefield Road, Mountain View, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 34,755
Initial cost, buildings and Improvements	0
Costs capitalized subsequent to acquisition/ improvement	56,764
Land and improvements, gross	34,755
Buildings and improvements, gross	56,765
Land and improvements and buildings and improvements, gross	91,519
Accumulated depreciation	$ 11,768
Depreciation life	35 years
Rentable square feet | ft²	170,823
1701 Page Mill Rd, Palo Alto, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 0
Initial cost, buildings and Improvements	99,522
Costs capitalized subsequent to acquisition/ improvement	29
Land and improvements, gross	0
Buildings and improvements, gross	99,551
Land and improvements and buildings and improvements, gross	99,551
Accumulated depreciation	$ 12,005
Depreciation life	35 years
Rentable square feet | ft²	128,688
3150 Porter Drive, Palo Alto, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 0
Initial cost, buildings and Improvements	21,715
Costs capitalized subsequent to acquisition/ improvement	410
Land and improvements, gross	0
Buildings and improvements, gross	22,125
Land and improvements and buildings and improvements, gross	22,125
Accumulated depreciation	$ 3,170
Depreciation life	35 years
Rentable square feet | ft²	36,886
900 Jefferson Ave., Redwood City, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 16,668
Initial cost, buildings and Improvements	0
Costs capitalized subsequent to acquisition/ improvement	109,377
Land and improvements, gross	18,063
Buildings and improvements, gross	107,982
Land and improvements and buildings and improvements, gross	126,045
Accumulated depreciation	$ 19,674
Depreciation life	35 years
Rentable square feet | ft²	228,505
900 Middlefield Road, Redwood City, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 7,959
Initial cost, buildings and Improvements	0
Costs capitalized subsequent to acquisition/ improvement	50,115
Land and improvements, gross	8,626
Buildings and improvements, gross	49,449
Land and improvements and buildings and improvements, gross	58,074
Accumulated depreciation	$ 8,684
Depreciation life	35 years
Rentable square feet | ft²	118,764
100 Hooper Street, San Francisco, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 78,564
Initial cost, buildings and Improvements	0
Costs capitalized subsequent to acquisition/ improvement	191,895
Land and improvements, gross	85,510
Buildings and improvements, gross	184,949
Land and improvements and buildings and improvements, gross	270,459
Accumulated depreciation	$ 11,632
Depreciation life	35 years
Rentable square feet | ft²	394,340
100 First St., San Francisco, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 49,150
Initial cost, buildings and Improvements	131,238
Costs capitalized subsequent to acquisition/ improvement	73,238
Land and improvements, gross	49,150
Buildings and improvements, gross	204,476
Land and improvements and buildings and improvements, gross	253,626
Accumulated depreciation	$ 73,294
Depreciation life	35 years
Rentable square feet | ft²	480,457
201 Third St., San Francisco, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 19,260
Initial cost, buildings and Improvements	84,018
Costs capitalized subsequent to acquisition/ improvement	69,158
Land and improvements, gross	19,260
Buildings and improvements, gross	153,176
Land and improvements and buildings and improvements, gross	172,436
Accumulated depreciation	$ 65,165
Depreciation life	35 years
Rentable square feet | ft²	346,538
250 Brannan St., San Francisco, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 7,630
Initial cost, buildings and Improvements	22,770
Costs capitalized subsequent to acquisition/ improvement	10,043
Land and improvements, gross	7,630
Buildings and improvements, gross	32,813
Land and improvements and buildings and improvements, gross	40,443
Accumulated depreciation	$ 11,783
Depreciation life	35 years
Rentable square feet | ft²	100,850
301 Brannan St., San Francisco, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 5,910
Initial cost, buildings and Improvements	22,450
Costs capitalized subsequent to acquisition/ improvement	7,704
Land and improvements, gross	5,910
Buildings and improvements, gross	30,154
Land and improvements and buildings and improvements, gross	36,064
Accumulated depreciation	$ 11,022
Depreciation life	35 years
Rentable square feet | ft²	82,834
303 Second St., San Francisco, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 63,550
Initial cost, buildings and Improvements	154,153
Costs capitalized subsequent to acquisition/ improvement	99,670
Land and improvements, gross	63,550
Buildings and improvements, gross	253,823
Land and improvements and buildings and improvements, gross	317,373
Accumulated depreciation	$ 96,466
Depreciation life	35 years
Rentable square feet | ft²	784,658
333 Brannan St., San Francisco, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 18,645
Initial cost, buildings and Improvements	0
Costs capitalized subsequent to acquisition/ improvement	80,788
Land and improvements, gross	18,645
Buildings and improvements, gross	80,787
Land and improvements and buildings and improvements, gross	99,433
Accumulated depreciation	$ 11,221
Depreciation life	35 years
Rentable square feet | ft²	185,602
345 Brannan Street, San Francisco, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 29,405
Initial cost, buildings and Improvements	113,179
Costs capitalized subsequent to acquisition/ improvement	752
Land and improvements, gross	29,403
Buildings and improvements, gross	113,933
Land and improvements and buildings and improvements, gross	143,336
Accumulated depreciation	$ 6,967
Depreciation life	35 years
Rentable square feet | ft²	110,050
350 Mission St., San Francisco, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 52,815
Initial cost, buildings and Improvements	0
Costs capitalized subsequent to acquisition/ improvement	213,312
Land and improvements, gross	52,815
Buildings and improvements, gross	213,312
Land and improvements and buildings and improvements, gross	266,127
Accumulated depreciation	$ 31,186
Depreciation life	35 years
Rentable square feet | ft²	455,340
360 Third St., San Francisco, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 0
Initial cost, buildings and Improvements	88,235
Costs capitalized subsequent to acquisition/ improvement	121,629
Land and improvements, gross	28,504
Buildings and improvements, gross	181,360
Land and improvements and buildings and improvements, gross	209,864
Accumulated depreciation	$ 53,833
Depreciation life	35 years
Rentable square feet | ft²	429,796
1800 Owens St., San Francisco, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 95,388
Initial cost, buildings and Improvements	0
Costs capitalized subsequent to acquisition/ improvement	437,715
Land and improvements, gross	95,388
Buildings and improvements, gross	437,715
Land and improvements and buildings and improvements, gross	533,103
Accumulated depreciation	$ 20,951
Depreciation life	35 years
Rentable square feet | ft²	750,370
345 Oyster Point Blvd., South San Francisco, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 13,745
Initial cost, buildings and Improvements	18,575
Costs capitalized subsequent to acquisition/ improvement	0
Land and improvements, gross	13,745
Buildings and improvements, gross	18,576
Land and improvements and buildings and improvements, gross	32,320
Accumulated depreciation	$ 1,723
Depreciation life	35 years
Rentable square feet | ft²	40,410
347 Oyster Point Blvd., South San Francisco, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 14,071
Initial cost, buildings and Improvements	18,289
Costs capitalized subsequent to acquisition/ improvement	44
Land and improvements, gross	14,071
Buildings and improvements, gross	18,333
Land and improvements and buildings and improvements, gross	32,404
Accumulated depreciation	$ 1,701
Depreciation life	35 years
Rentable square feet | ft²	39,780
349 Oyster Point Blvd., South San Francisco, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 23,112
Initial cost, buildings and Improvements	22,601
Costs capitalized subsequent to acquisition/ improvement	324
Land and improvements, gross	23,112
Buildings and improvements, gross	22,925
Land and improvements and buildings and improvements, gross	46,037
Accumulated depreciation	$ 2,968
Depreciation life	35 years
Rentable square feet | ft²	65,340
Kilroy Oyster Point, Phase I, South San Francisco, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 0
Initial cost, buildings and Improvements	0
Costs capitalized subsequent to acquisition/ improvement	620
Land and improvements, gross	0
Buildings and improvements, gross	620
Land and improvements and buildings and improvements, gross	620
Accumulated depreciation	$ 0
Depreciation life	35 years
Rentable square feet | ft²	0
505 Mathilda Ave., Sunnyvale, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 37,843
Initial cost, buildings and Improvements	1,163
Costs capitalized subsequent to acquisition/ improvement	50,450
Land and improvements, gross	37,943
Buildings and improvements, gross	51,513
Land and improvements and buildings and improvements, gross	89,456
Accumulated depreciation	$ 9,267
Depreciation life	35 years
Rentable square feet | ft²	212,322
555 Mathilda Ave., Sunnyvale, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 37,843
Initial cost, buildings and Improvements	1,163
Costs capitalized subsequent to acquisition/ improvement	50,447
Land and improvements, gross	37,943
Buildings and improvements, gross	51,510
Land and improvements and buildings and improvements, gross	89,453
Accumulated depreciation	$ 9,267
Depreciation life	35 years
Rentable square feet | ft²	212,322
599 Mathilda Ave., Sunnyvale, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 13,538
Initial cost, buildings and Improvements	12,559
Costs capitalized subsequent to acquisition/ improvement	63
Land and improvements, gross	13,538
Buildings and improvements, gross	12,622
Land and improvements and buildings and improvements, gross	26,160
Accumulated depreciation	$ 4,559
Depreciation life	35 years
Rentable square feet | ft²	76,031
605 Mathilda Ave., Sunnyvale, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 29,014
Initial cost, buildings and Improvements	891
Costs capitalized subsequent to acquisition/ improvement	77,282
Land and improvements, gross	29,090
Buildings and improvements, gross	78,096
Land and improvements and buildings and improvements, gross	107,187
Accumulated depreciation	$ 20,542
Depreciation life	35 years
Rentable square feet | ft²	162,785
601 108th Ave., Bellevue, WA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 0
Initial cost, buildings and Improvements	214,095
Costs capitalized subsequent to acquisition/ improvement	40,300
Land and improvements, gross	0
Buildings and improvements, gross	254,395
Land and improvements and buildings and improvements, gross	254,395
Accumulated depreciation	$ 88,958
Depreciation life	35 years
Rentable square feet | ft²	488,470
10900 NE 4th St., Bellevue, WA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 25,080
Initial cost, buildings and Improvements	150,877
Costs capitalized subsequent to acquisition/ improvement	45,984
Land and improvements, gross	25,080
Buildings and improvements, gross	196,861
Land and improvements and buildings and improvements, gross	221,941
Accumulated depreciation	$ 62,594
Depreciation life	35 years
Rentable square feet | ft²	428,557
837 N. 34th St., Lake Union, WA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 0
Initial cost, buildings and Improvements	37,404
Costs capitalized subsequent to acquisition/ improvement	6,293
Land and improvements, gross	0
Buildings and improvements, gross	43,697
Land and improvements and buildings and improvements, gross	43,697
Accumulated depreciation	$ 12,787
Depreciation life	35 years
Rentable square feet | ft²	112,487
701 N. 34th St., Lake Union, WA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 0
Initial cost, buildings and Improvements	48,027
Costs capitalized subsequent to acquisition/ improvement	8,545
Land and improvements, gross	0
Buildings and improvements, gross	56,572
Land and improvements and buildings and improvements, gross	56,572
Accumulated depreciation	$ 18,277
Depreciation life	35 years
Rentable square feet | ft²	141,860
801 N. 34th St., Lake Union, WA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 0
Initial cost, buildings and Improvements	58,537
Costs capitalized subsequent to acquisition/ improvement	20,661
Land and improvements, gross	0
Buildings and improvements, gross	79,198
Land and improvements and buildings and improvements, gross	79,198
Accumulated depreciation	$ 20,013
Depreciation life	35 years
Rentable square feet | ft²	169,412
320 Westlake Avenue North, WA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 14,710
Initial cost, buildings and Improvements	82,018
Costs capitalized subsequent to acquisition/ improvement	14,453
Land and improvements, gross	14,710
Buildings and improvements, gross	96,471
Land and improvements and buildings and improvements, gross	111,181
Accumulated depreciation	$ 23,304
Depreciation life	35 years
Rentable square feet | ft²	184,644
321 Terry Avenue North, Lake Union, WA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 10,430
Initial cost, buildings and Improvements	60,003
Costs capitalized subsequent to acquisition/ improvement	10,366
Land and improvements, gross	10,430
Buildings and improvements, gross	70,369
Land and improvements and buildings and improvements, gross	80,799
Accumulated depreciation	$ 18,091
Depreciation life	35 years
Rentable square feet | ft²	135,755
401 Terry Avenue North, Lake Union, WA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 22,500
Initial cost, buildings and Improvements	77,046
Costs capitalized subsequent to acquisition/ improvement	13
Land and improvements, gross	22,500
Buildings and improvements, gross	77,059
Land and improvements and buildings and improvements, gross	99,559
Accumulated depreciation	$ 18,225
Depreciation life	35 years
Rentable square feet | ft²	140,605
333 Dexter Ave. North, South Lake Union, WA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 0
Initial cost, buildings and Improvements	0
Costs capitalized subsequent to acquisition/ improvement	323,433
Land and improvements, gross	42,853
Buildings and improvements, gross	280,580
Land and improvements and buildings and improvements, gross	323,433
Accumulated depreciation	$ 2,592
Depreciation life	35 years
Rentable square feet | ft²	0
3200 Paseo Village Way, Del Mar, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, land and improvements	$ 106,419
Initial cost, buildings and Improvements	0
Costs capitalized subsequent to acquisition/ improvement	272,457
Land and improvements, gross	106,419
Buildings and improvements, gross	272,457
Land and improvements and buildings and improvements, gross	378,876
Accumulated depreciation	$ 7,316
Depreciation life	35 years
Rentable square feet | ft²	0
Operating Properties [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, encumbrances	$ 254,365
Initial cost, land and improvements	1,496,855
Initial cost, buildings and Improvements	2,699,959
Costs capitalized subsequent to acquisition/ improvement	4,215,126
Land and improvements, gross	1,628,848
Buildings and improvements, gross	6,783,092
Land and improvements and buildings and improvements, gross	8,411,940
Accumulated depreciation	$ 1,798,646
Rentable square feet | ft²	14,620,166
Office Building [Member] | W. Olympic Blvd., Los Angeles, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, encumbrances	$ 166,776
Office Building [Member] | 320 Westlake Ave. North, WA and 321 Terry Avenue North, Lake Union, WA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, encumbrances	87,589
Undeveloped land and construction in progress [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, encumbrances	0
Initial cost, land and improvements	874,773
Initial cost, buildings and Improvements	0
Costs capitalized subsequent to acquisition/ improvement	903,333
Land and improvements, gross	874,773
Buildings and improvements, gross	903,333
Land and improvements and buildings and improvements, gross	1,778,106
Accumulated depreciation	$ 0
Rentable square feet | ft²	0

XML

Schedule III - Real Estate and Accumulated Depreciation - Narrative (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2020 USD ($) ft² property project
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, encumbrances | $	$ 254,365
Rentable square feet	14,620,166
Investment in real estate, federal Income tax basis | $	$ 8,600,000
In-process development projects - under construction [Member]
Real Estate and Accumulated Depreciation [Line Items]
Number of buildings | project	3
Rentable square feet	856,000
Sunset Blvd., Gower St. and El Centro Ave. Properties in Los Angeles [Member]
Real Estate and Accumulated Depreciation [Line Items]
Number of buildings | property	6
1550 N. El Centro Avenue, Los Angeles, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Depreciation life	35 years
Number of Units | property	200
Rentable square feet	0
3200 Paseo Village Way, San Diego, CA (Resi Phase I) (16) [Member]
Real Estate and Accumulated Depreciation [Line Items]
Number of Units | property	608
333 Dexter Ave. North, South Lake Union, WA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Depreciation life	35 years
Rentable square feet	0
Office Building [Member]
Real Estate and Accumulated Depreciation [Line Items]
Unamortized debt issuance expense | $	$ (800)
Office Building [Member] | Sunset Blvd., Gower St. and El Centro Ave. Properties in Los Angeles [Member]
Real Estate and Accumulated Depreciation [Line Items]
Number of buildings | property	5
Office Building [Member] | W. Olympic Blvd., Los Angeles, CA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, encumbrances | $	$ 166,776
Office Building [Member] | 320 Westlake Ave. North, WA and 321 Terry Avenue North, Lake Union, WA [Member]
Real Estate and Accumulated Depreciation [Line Items]
Initial cost, encumbrances | $	$ 87,589
Residential Tower [Member] | Sunset Blvd., Gower St. and El Centro Ave. Properties in Los Angeles [Member]
Real Estate and Accumulated Depreciation [Line Items]
Number of buildings | property	1
Building [Member]
Real Estate and Accumulated Depreciation [Line Items]
Depreciation life	35 years
Tenant Improvements [Member] | Office Building [Member] | 12860 and 12830 El Camino Real, Del Mar, CA [Member] | In-process development projects - under construction [Member]
Real Estate and Accumulated Depreciation [Line Items]
Rentable square feet	285,000
Tenant Improvements [Member] | Office Building [Member] | 333 Dexter Ave. North, South Lake Union, WA [Member] | In-process development projects - under construction [Member]
Real Estate and Accumulated Depreciation [Line Items]
Rentable square feet	635,000
Tenant Improvements [Member] | Minimum [Member]
Real Estate and Accumulated Depreciation [Line Items]
Property depreciable lives	1 year
Tenant Improvements [Member] | Maximum [Member]
Real Estate and Accumulated Depreciation [Line Items]
Property depreciable lives	20 years

XML

Schedule III - Real Estate and Accumulated Depreciation - Historical Cost Real Estate Reconciliation (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
SEC Schedule, 12-28, Real Estate Companies, Investment in Real Estate [Roll Forward]
Total real estate held for investment, beginning of year	$ 9,628,773	$ 8,426,632	$ 7,417,777
Acquisitions	0	460,512	581,671
Improvements, etc.	645,170	890,654	724,016
Total additions during period	645,170	1,351,166	1,305,687
Cost of real estate sold	(44,070)	(120,788)	(286,623)
Other	(39,827)	(28,237)	(10,209)
Total deductions during period	(83,897)	(149,025)	(296,832)
Total real estate held for investment, end of year	$ 10,190,046	$ 9,628,773	$ 8,426,632

XML

Schedule III - Real Estate and Accumulated Depreciation - Accumulated Depreciation Reconciliation (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
SEC Schedule, 12-28, Real Estate Companies, Investment in Real Estate, Accumulated Depreciation [Roll Forward]
Accumulated depreciation, beginning of year	$ 1,561,361	$ 1,391,368	$ 1,264,162
Depreciation of real estate	244,815	211,893	198,578
Total additions during period	244,815	211,893	198,578
Write-offs due to sale	(6,401)	(41,655)	(71,372)
Other	(1,129)	(245)	0
Total deductions during period	(7,530)	(41,900)	(71,372)
Accumulated depreciation, end of year	$ 1,798,646	$ 1,561,361	$ 1,391,368