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Secured and Unsecured Debt of the Operating Partnership
 9 Months Ended
Sep. 30, 2025
Kilroy Realty L.P.  
Debt Instrument [Line Items]  
Secured and Unsecured Debt of the Operating Partnership Secured and Unsecured Debt of the Operating Partnership
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.

Unsecured Senior Notes - Registered Public Offering

In August 2025, 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 $4.0 million, on our consolidated balance sheets. The unsecured senior notes, which are scheduled to mature on October 15, 2035, require semi-annual interest payments each April and October based on a stated annual interest rate of 5.875%. 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 July 15, 2035. On or after July 15, 2035, the Operating Partnership may redeem the notes at any time, either in whole or in part, at par. In September 2025, the Operating Partnership used the net proceeds from the issuance of the $400.0 million 5.875% unsecured senior notes to redeem the $400.0 million aggregate principal amount of our outstanding 4.375% unsecured senior notes.

Unsecured Revolving Credit Facility and Term Loan Facility

The following table summarizes the balance and terms of our unsecured revolving credit facility as of September 30, 2025 and December 31, 2024:
Unsecured Revolving Credit Facility
September 30, 2025December 31, 2024
($ 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)
5.44 %5.69 %
Facility fee-annual rate (3)
0.250%
Unamortized deferred financing costs (3)
$10,035 $12,692 
Maturity date (4)
July 31, 2028
________________________
(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 September 30, 2025 and December 31, 2024. 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% based on our credit rating as of September 30, 2025 and December 31, 2024. 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 in 2024. These costs are included in Prepaid expenses and other assets, net on our consolidated balance sheets, which remain 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.

The following table summarizes the balance and terms of our 2024 Term Loan Facility as of September 30, 2025:

2024 Term Loan Facility
September 30, 2025December 31, 2024
($ in thousands)
Outstanding borrowings (1)
$200,000 $200,000 
Interest rate (2)
5.46 %5.70 %
Unamortized deferred financing costs (3)
$368 $1,229 
Maturity date (4)
October 3, 2026October 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 September 30, 2025 and 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 September 30, 2025 and December 31, 2024.
(3)We incurred debt origination and legal costs in connection with the amendment and restatement of the unsecured revolving credit facility in 2024, which remain to be amortized through the maturity date of the 2024 Term Loan Facility. Additionally, in connection with extending the maturity date, we incurred additional costs which remain to be amortized through the extended maturity date of the 2024 Term Loan Facility.
(4)During the three months ended September 30, 2025, we exercised our option to extend the maturity date by 12 months to October 3, 2026. The maturity date may be extended by an additional 12-month period, at the Operating Partnership’s election.

Financial Covenants and Restrictions

The unsecured revolving credit facility, unsecured term loan facility, 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 September 30, 2025.

Debt Maturities

The following table summarizes the stated debt maturities and scheduled amortization payments for all outstanding debt as of September 30, 2025:

Year
(in thousands)
Remaining 2025$1,584 
2026601,317 
2027249,125 
2028400,000 
2029475,000 
2030500,000 
Thereafter2,400,000 
Total aggregate principal value4,627,026 
Less: unamortized net discounts and deferred financing costs (1)
(37,515)
Total debt, net$4,589,511 
________________________ 
(1)Includes $26.1 million of unamortized deferred financing costs for the unsecured term loan facility, unsecured senior notes, and secured debt, and $11.4 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

The following table sets forth gross interest expense and capitalized interest for the three and nine months ended September 30, 2025 and 2024. 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 currently under construction.
Three Months Ended September 30,Nine Months Ended September 30,
2025202420252024
(in thousands)
Gross interest expense$54,726 $57,235 $158,599 $173,191 
Capitalized interest
(22,574)(20,827)(64,455)(61,149)
Interest expense$32,152 $36,408 $94,144 $112,042