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Kilroy Realty of L.A. Sees Quarterly Income Double

February 05, 2003|Roger Vincent | Times Staff Writer

Kilroy Realty Corp., a West Los Angeles real estate investment trust, reported that profit nearly doubled in the fourth quarter as it disposed of four major properties.

Kilroy, which owns West Coast office and industrial properties, earned $14 million, or 50 cents a share, compared with $7.6 million, or 28 cents, in the year-earlier period, the company said late Monday. Revenue rose 7.7% to $51.7 million in the period ended Dec 31.

Kilroy's funds from operations, a key measure of profitability for REITs, rose 16% to $24.3 million, or 76 cents a share, from $20.9 million, or 68 cents, a year earlier. A REIT allows individual investors to participate in large real estate ventures. Unlike other public companies, REITs must distribute 95% of their income to shareholders.

For the year, Kilroy's profit rose 5% to $40.3 million, or $1.45 a share, from $38.4 million, or $1.40, in 2001. Revenue slipped slightly to $202.1 million from $203.6 million the previous year. Funds from operations totaled $97.9 million, or $3.09 a share, compared with $91.6 million, or $3, in 2001.

Kilroy completed $106 million in new development in 2002, adding 436,000 square feet of space in six new office properties to its portfolio. At year-end, the company owned 12.3 million square feet of space, of which 93.7% was occupied.

The company sold $41.8 million of nonstrategic real estate assets in the fourth quarter, including two office and two industrial properties, that produced a net gain of $6.1 million for the period. The company used the proceeds to help fund its development program and to buy back 508,200 shares at an average price of $22.39.

Kilroy has 608,400 square feet of space in development, all in Southern California. The space is 53% leased and valued at $198 million, the company said.

In addition, Kilroy reported that San Diego software maker Peregrine Systems Inc., now in Chapter 11 proceedings, said it would ask a Bankruptcy Court judge to nullify two leases it has with Kilroy for nearly 242,000 square feet in Del Mar, Calif.

Kilroy shares fell 27 cents Tuesday to $21.43 on the New York Stock Exchange.

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