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Secured and Unsecured Debt of the Operating Partnership
 12 Months Ended
Dec. 31, 2024
Debt Instrument [Line Items]  
Secured and Unsecured Debt of the Operating Partnership Secured and Unsecured Debt of the Company
In this Note 9, 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 or its subsidiaries.

The Company generally guarantees all of 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, 2024 and 2023, the Operating Partnership had $4.0 billion and $4.3 billion, respectively, outstanding in total, including unamortized discounts and deferred financing costs, under these unsecured debt obligations.

In addition, although the remaining $0.6 billion of the Operating Partnership’s debt as of December 31, 2024 and 2023 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 10 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.  
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, 2024 and 2023:

Annual Stated
Interest Rate (1)
GAAP
Effective Rate (1)(2)
Maturity DateDecember 31,
Type of Debt20242023
(in thousands)
Mortgage note payable3.57%3.57%December 2026$152,668 $156,386 
Mortgage note payable (3)
4.48%4.48%July 202779,020 81,308 
Mortgage note payable5.90%5.90%August 2034375,000 375,000 
Total secured debt$606,688 $612,694 
Unamortized deferred financing costs(8,489)(9,469)
Total secured debt, net$598,199 $603,225 
____________________
(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 $795.3 million as of December 31, 2024.

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, 2024, 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 Debt

Repayment of $425.0 million Unsecured Senior Notes Due 2024

During the year ended December 31, 2023, the Company completed open-market repurchases of $21.3 million of the Operating Partnership’s 3.450% $425.0 million unsecured senior notes due December 15, 2024 at a discount, leaving an aggregate remaining principal balance of $403.7 million. In December 2024, the Company repaid the aggregate remaining principal balance of $403.7 million senior notes on the maturity date.

Issuance of $400.0 million Unsecured Senior Notes Due 2036

In January 2024, the Operating Partnership issued $400.0 million 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 $4.5 million, on our consolidated balance sheets. The unsecured senior notes, which are scheduled to mature on January 15, 2036, require semi-annual interest payments each January and July based on a stated annual interest rate of 6.250%. The Operating Partnership may redeem the notes at any time, either in whole or in part, subject to the payment of an early redemption premium with respect to redemptions prior to October 15, 2035. On or after October 15, 2035, the Operating Partnership may redeem the notes at any time, either in whole or in part, at par.
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 unamortized discounts of $8.4 million and $5.3 million and unamortized deferred financing costs of $15.8 million and $15.9 million as of December 31, 2024 and 2023, respectively:
Net Carrying Amount
as of December 31,
Issuance dateMaturity dateStated
coupon
rate
Effective
interest
rate (1)
20242023
(in thousands)
4.300% Unsecured Senior Notes (2)
July 2018July 20264.300%4.300%$50,000 $50,000 
Unamortized discount and deferred financing costs(69)(113)
Net carrying amount$49,931 $49,887 
4.350% Unsecured Senior Notes (2)
October 2018October 20264.350%4.350%$200,000 $200,000 
Unamortized discount and deferred financing costs(314)(488)
Net carrying amount$199,686 $199,512 
3.350% Unsecured Senior Notes (3)
February 2017February 20273.350%3.350%$175,000 $175,000 
Unamortized discount and deferred financing costs(247)(363)
Net carrying amount$174,753 $174,637 
3.450% Unsecured Senior Notes (3)
February 2017February 20293.450%3.450%$75,000 $75,000 
Unamortized discount and deferred financing costs(176)(219)
Net carrying amount$74,824 $74,781 
4.270% Unsecured Senior Notes (2)
April 2020January 20314.270%4.270%$350,000 $350,000 
Unamortized discount and deferred financing costs(1,101)(1,282)
Net carrying amount$348,899 $348,718 
3.450% Unsecured Senior Notes (4)
December 2017December 20243.450%3.470%$— $403,712 
Unamortized discount and deferred financing costs— (558)
Net carrying amount$— $403,154 
4.375% Unsecured Senior Notes (5)
September 2015October 20254.375%4.444%$400,000 $400,000 
Unamortized discount and deferred financing costs(415)(969)
Net carrying amount$399,585 $399,031 
4.750% Unsecured Senior Notes (4)
November 2018December 20284.750%4.800%$400,000 $400,000 
Unamortized discount and deferred financing costs(1,973)(2,468)
Net carrying amount$398,027 $397,532 
4.250% Unsecured Senior Notes (6)
July 2014August 20294.250%4.350%$400,000 $400,000 
Unamortized discount and deferred financing costs(2,439)(2,971)
Net carrying amount$397,561 $397,029 
3.050% Unsecured Senior Notes (6)
September 2019February 20303.050%3.064%$500,000 $500,000 
Unamortized discount and deferred financing costs(3,036)(3,629)
Net carrying amount$496,964 $496,371 
2.500% Unsecured Senior Notes (7)
August 2020November 20322.500%2.560%$425,000 $425,000 
Unamortized discount and deferred financing costs(4,201)(4,735)
Net carrying amount$420,799 $420,265 
2.650% Unsecured Senior Notes (7)
October 2021November 20332.650%2.654%$450,000 $450,000 
Unamortized discount and deferred financing costs(3,075)(3,422)
Net carrying amount$446,925 $446,578 
6.250% Unsecured Senior Notes (8)
January 2024January 20366.250%6.385%$400,000 $— 
Unamortized discount and deferred financing costs(7,159)— 
Net carrying amount$392,841 $— 
Total Unsecured Senior Notes, Net$3,800,795 $3,807,495 

____________________
(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 April 18th and October 18th of each year.
(3)Interest on these notes is payable semi-annually in arrears on February 17th and August 17th of each year.
(4)Interest on these notes is payable semi-annually in arrears on June 15th and December 15th of each year.
(5)Interest on these notes is payable semi-annually in arrears on April 1st and October 1st of each year.
(6)Interest on these notes is payable semi-annually in arrears on February 15th and August 15th of each year.
(7)Interest on these notes is payable semi-annually in arrears on May 15th and November 15th of each year.
(8)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

In March 2024, the Operating Partnership amended and restated the terms of its unsecured revolving credit facility. The amendment and restatement maintained the $1.1 billion borrowing capacity and extended the maturity date of the unsecured revolving credit facility to July 31, 2028.

The following table summarizes the balance and terms of our unsecured revolving credit facility as of December 31, 2024 and 2023:
December 31, 2024December 31, 2023
(in thousands)
Outstanding borrowings$— $— 
Remaining borrowing capacity (1)
1,100,000 1,100,000 
Total borrowing capacity (1)
$1,100,000 $1,100,000 
Interest rate (2)
5.69 %6.38 %
Facility fee-annual rate (3)
0.250%0.200%
Maturity date (4)
July 31, 2028July 31, 2025
____________________
(1)Remaining and total borrowing capacity are further reduced by the amount of our outstanding letters of credit which total approximately $5.2 million as of December 31, 2024 and December 31, 2023. We may elect to borrow, subject to bank approval and obtaining commitments for any additional borrowing capacity, up to an additional $500.0 million under an accordion feature pursuant to the terms of the unsecured revolving credit facility.
(2)Our unsecured revolving credit facility interest rate was calculated using the Secured Overnight Financing Rate (“SOFR”) plus a SOFR adjustment of 0.10% (“Adjusted SOFR”) and a margin of 1.100% and 0.900% based on our credit rating as of December 31, 2024 and 2023, respectively. We may be entitled to a temporary 0.01% reduction in the interest rate provided we meet certain sustainability goals with respect to the ongoing reduction of greenhouse gas emissions.
(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 in connection with the amendment and restatement of the unsecured revolving credit facility. As of December 31, 2024 and 2023, $12.7 million and $3.2 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.
(4)The maturity date may be extended by two six-month periods, at the Operating Partnership’s election.

The Operating Partnership intends to borrow under the unsecured revolving credit facility from time to time for general corporate purposes, including to finance development and redevelopment expenditures, to fund potential acquisitions, to repay long-term debt, and to supplement cash balances in response to market conditions.

In connection with amending and restating the unsecured revolving credit facility, the Operating Partnership repaid $200.0 million of its existing $520.0 million unsecured term loan facility (the “2022 Term Loan Facility”) and extended the maturity date on $200.0 million of the remaining $320.0 million principal balance by 12 months to October 3, 2025 (the “2024 Term Loan Facility”). The following table summarizes the balance and terms of our 2024 Term Loan Facility as of December 31, 2024:
2024 Term Loan Facility
December 31, 2024
(in thousands)
Outstanding borrowings$200,000 
Remaining borrowing capacity— 
Total borrowing capacity (1)
$200,000 
Interest rate (2)
5.70 %
Maturity date (3)
October 3, 2025
____________________
(1)We may elect to borrow, subject to bank approval and obtaining commitments for any additional borrowing capacity, up to an additional $130.0 million as of December 31, 2024, under an accordion feature pursuant to the terms of the 2024 Term Loan Facility.
(2)Our 2024 Term Loan Facility interest rate was calculated using Adjusted SOFR plus a margin of 1.200% based on our credit rating as of December 31, 2024. Additionally, we incurred debt origination and legal costs in connection with the amendment and restatement of the unsecured revolving credit facility. As of December 31, 2024, $1.2 million of unamortized deferred financing costs, inclusive of unamortized initial issuance costs transferred from the 2022 Term Loan Facility, remained to be amortized through the maturity date of the 2024 Term Loan Facility.
(3)The maturity date may be extended by two 12-month periods, at the Operating Partnership’s election.
In September 2024, the Operating Partnership repaid the remaining $120.0 million outstanding on its 2022 Term Loan Facility. The following table summarizes the balance and terms of our 2022 Term Loan Facility as of December 31, 2023:

2022 Term Loan Facility
December 31, 2023
(in thousands)
Outstanding borrowings$520,000 
Remaining borrowing capacity— 
Total borrowing capacity$520,000 
Interest rate (1)
6.41 %
Undrawn facility fee-annual rate (2)
0.200%
Maturity dateOctober 3, 2024
____________________
(1)Our 2022 Term Loan Facility interest rate was calculated using Adjusted SOFR plus a margin of 0.950% based on our credit rating as of December 31, 2023.
(2)Our undrawn facility fee was paid on a quarterly basis and was calculated based on the remaining borrowing capacity. In addition to the facility fee, we incurred debt origination and legal costs. As of December 31, 2023, $2.3 million of unamortized deferred financing costs remained to be amortized through the maturity date of our 2022 Term Loan Facility.

Debt Covenants and Restrictions

The unsecured revolving credit facility, unsecured term loan facility, the unsecured senior notes, including the private placement notes, and certain other secured debt arrangements contain covenants and restrictions requiring us to meet certain financial ratios and reporting requirements. Some of the more restrictive financial covenants include a maximum ratio of total debt to total asset value, a minimum fixed-charge coverage ratio, a maximum ratio of secured debt to total asset value, 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 were in compliance with all of our financial covenants as of December 31, 2024 and 2023.

Debt Maturities

The following table summarizes the stated debt maturities and scheduled amortization payments for all outstanding debt as of December 31, 2024:

Year(in thousands)
2025
$606,246 
2026401,317 
2027249,125 
2028400,000 
2029475,000 
Thereafter2,500,000 
Total aggregate principal value (1)
$4,631,688 
________________________ 
(1)     Includes gross principal balance of outstanding debt before the effect of the following at December 31, 2024: $25.5 million of unamortized deferred financing costs for the unsecured term loan facility, unsecured senior notes, and secured debt, and $8.4 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.
Capitalized Interest and Loan Fees

The following table sets forth our gross interest expense and capitalized interest for the years ended December 31, 2024, 2023, and 2022. The interest expense capitalized was recorded as a cost of development and redevelopment and increased the carrying value of undeveloped land and construction in progress.

Year Ended December 31,
202420232022
(in thousands)
Gross interest expense$227,748 $192,983 $161,761 
Capitalized interest(82,461)(78,767)(77,483)
Interest expense$145,287 $114,216 $84,278