Portfolio Overview - As of December 31, 2024, the stabilized portfolio included 123 office properties with a total rentable area of 17,142,721 square feet and an occupancy rate of 82.8%[26] - The stabilized residential properties consisted of 3 properties with 1,001 units and an occupancy rate of 92.5%[28] - As of December 31, 2024, approximately 17.2% of the total square footage of stabilized office properties was unoccupied[94] - The company owns fourteen office buildings with approximately 2.3 million aggregate rentable square feet, representing 13.6% of its total stabilized portfolio located on leased parcels[111] - The company has a total of 493 leases in its stabilized portfolio, covering 13,794,740 square feet[212] Future Development and Projects - The future development pipeline includes eight sites representing approximately 64 gross acres of undeveloped land, with the potential to develop over 6.0 million square feet of office, life science, residential, and retail space[41] - The company had two redevelopment projects in the tenant improvement phase totaling approximately 100,000 square feet and one development project under construction totaling approximately 875,000 square feet[41] - As of December 31, 2024, the company has 100,000 square feet of tenant improvement projects in the San Francisco Bay Area and San Diego, with stabilization dates ranging from Q3 2025 to Q3 2025[195] - The company is currently constructing the Kilroy Oyster Point - Phase 2 project, which will add 875,000 square feet of office/life science space, estimated to stabilize in Q1 2026[198] - The future development pipeline includes approximately 2,300,000 square feet at the Flower Mart in SOMA and 1,100 residential units at Kilroy East Village in San Diego[200] Sustainability and Environmental Initiatives - The company achieved a GRESB 5 Star designation for both its standing assets and development portfolio in 2024, reflecting its commitment to sustainability[47] - The company has been recognized with the U.S. EPA ENERGY STAR Partner of the Year Sustained Excellence Award for nine consecutive years[47] - The company has achieved carbon neutral operations since 2020, offsetting all Scope 1, Scope 2, and Scope 3 emissions through various sustainability measures[49] - The company aims to incorporate green lease language into all new leases, aligning financial and energy incentives with tenants[47] - The company plans to invest $2 billion in sustainability initiatives over the next five years[6] Financial Performance and Revenue - The company reported a total revenue of $151.76 million, reflecting a 5.0% increase year-over-year[1] - For the year ended December 31, 2024, approximately 98.5% of the company's revenues were derived from rental income[91] - The company reported a total annualized rent of $1,199,995,400, representing a 4.7% increase year-over-year[1] - The company reported a revenue increase of 8.3% year-over-year, reaching $4.5 billion[1] - The company reported a revenue of $1.28 billion, representing a 5.7% increase year-over-year[1] Tenant and Lease Information - As of December 31, 2024, the 20 largest tenants accounted for approximately 53.6% of total annualized base rental revenues[50] - The company's 20 largest tenants contribute an annualized base rental revenue of $423.4 million, representing 53.6% of total annualized base rental revenue[203] - 54% of the tenants operated in the technology industry, 17% in life science and health care, 9% in professional services, 7% in media, and 6% in finance, insurance, and real estate as of December 31, 2024[93] - The weighted average lease term for significant tenants is 6.0 years, with the longest lease expiration extending to 2037[203] - Leases representing approximately 5.2% and 14.0% of the leased rentable square footage of the company's properties are scheduled to expire in 2025 and 2026, respectively[94] Employee and Community Engagement - The company employed 229 people as of December 31, 2024, with a workforce that was 56% female and 46% ethnically diverse[53] - The company reported a 17% increase in volunteer hours provided by employees, totaling over 1,200 hours dedicated to community service[57] - The company has a comprehensive health benefits program, with over 90% of premiums absorbed by the company[55] - The company focuses on talent acquisition and retention, emphasizing a performance-based culture and diversity initiatives[53] - The company has implemented various training and education programs to support employee growth and development[54] Risks and Challenges - The company faces significant competition in the commercial real estate market, which may affect occupancy and rental rates[68] - The company is subject to various environmental regulations that may impact its operations and financial condition[68] - The company may not be able to meet its debt service obligations, which could adversely affect its financial condition[15] - Rising inflation may increase general and administrative expenses, impacting the company's results of operations and cash flows[77] - The company faces risks associated with ground leases and restrictive agreements that limit property use and transferability, potentially leading to property loss[15] Debt and Financing - The company had $200 million outstanding under its unsecured term loan facility as of December 31, 2024, with no borrowings under its unsecured revolving credit facility[78] - The company has approximately $4.6 billion in aggregate principal amount of indebtedness as of December 31, 2024, with $606.2 million in principal payments expected during the year ending December 31, 2025[134] - Total debt represented 49.0% of the company's total market capitalization as of December 31, 2024[134] - The company may issue additional common units and shares of capital stock without unitholder or stockholder approval, potentially diluting existing investments[15] - The company is required to distribute at least 90% of its taxable income to maintain its REIT status, which may limit its ability to fund future capital needs from operating cash flows[144] Technology and Cybersecurity - The company is gradually incorporating artificial intelligence into its decision-making processes, which may be subject to increased regulatory scrutiny and could impact operational efficiency[128] - The company has developed a cybersecurity risk management program integrated with its overall enterprise risk management[170] - The company cannot guarantee that its IT systems or those of third-party service providers are free from exploitable defects, which could lead to security breaches[121] - Any cybersecurity incidents could adversely impact the company's financial condition, results of operations, and ability to satisfy debt obligations[123] - The company must maintain adequate security measures to comply with varying state laws around data breaches, requiring significant investments in resources[127]

Group 1 - Kilroy Realty Corporation (NYSE: KRC) shares have not participated in the equity rally over the past year, remaining largely flat due to higher interest rates and a challenging office leasing environment [1] - The company has faced difficulties in the office leasing market, which has impacted its stock performance [1] Group 2 - The article does not provide specific financial metrics or performance data related to Kilroy Realty Corporation [2]

Financial Data and Key Metrics Changes - FFO was $1.20 per diluted share in Q4 2024, impacted by one-time items totaling approximately $0.11 per share [22] - Cash same-property NOI growth was 70 basis points in Q4 2024, including a 90 basis point contribution from restoration and termination fee income [22] - Occupancy ended the year at 82.8%, affected by large move-outs including Capital One and Microsoft [23] Business Line Data and Key Metrics Changes - The company signed approximately 708,000 square feet of leases in Q4 2024, the highest level of leasing activity since Q4 2019 [8] - Significant deals included a multi-floor lease with Walmart and a 274,000 square foot lease with a global technology company [9][10] - The company expects average occupancy in 2025 to range between 80% and 82%, a decrease of approximately 300 basis points compared to 2024 [23] Market Data and Key Metrics Changes - The transaction market showed positive trends with increased deal volume and financing levels year-over-year, particularly for smaller deals [17] - In Q4 2024, notable core deals were observed in Austin and the Bay Area with going-in yields in the mid-6% to low-7% range [18] - VC funding for life sciences reached $11.1 billion in 2024, up 39% from 2023, indicating strong demand in that sector [50] Company Strategy and Development Direction - The company is focused on maximizing value realization for shareholders by assessing future development pipelines and exploring alternative uses for certain land parcels [14] - The completion of Kilroy Oyster Point Phase 2 is expected to drive growth, with the project now fully ready to welcome tenants [13] - The company aims to maintain a flexible balance sheet and monetize non-core assets while delivering high-quality developments [31] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the recovery of markets, expecting sustained trends to accelerate over the next several years [11] - The company anticipates a busy year across all parts of its platform, with a focus on addressing lease expirations proactively [16] - Management noted that after Q1 2025, they expect more stability in occupancy levels throughout the year [36] Other Important Information - The company sold its corporate airplane in Q4 2024, contributing to financial results [7] - The company is in advanced discussions with residential developers on two sites expected to generate over $150 million in proceeds [20] - Non-cash GAAP NOI adjustments are expected to decline significantly in 2025, reflecting the cadence of leasing activity over the last 24 months [26] Q&A Session Summary Question: Current visibility on occupancy for 2025 - Management indicated significant move-outs in Q1 2025 but expects stability in occupancy levels after that [36] Question: Conversations regarding KOP Phase 2 - Management noted that the completion of KOP Phase 2 has changed the nature of tenant conversations, leading to increased interest [41][42] Question: Addressing 2026 lease expirations - Management confirmed that the largest expiration in 2026 is still reflected in the schedule, as it involves a direct deal with a subtenant [54] Question: Impact of AI and NIH funding on tenant decisions - Management has not observed any deals being put on hold due to recent headlines regarding AI or NIH funding [99] Question: Thoughts on retaining multifamily towers - Management views the retained multifamily towers as significant growth drivers integrated with other uses [103] Question: Demand for higher-quality repositioned assets - Management believes that the demand for high-quality assets allows them to maintain steady concessions without undercutting the market [112][115]

分组1 - Kilroy Realty (KRC) reported quarterly funds from operations (FFO) of $1.20 per share, exceeding the Zacks Consensus Estimate of $1.03 per share, and up from $1.08 per share a year ago, representing a 16.50% surprise [1] - The company achieved revenues of $286.38 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 3.30%, compared to $269.02 million in the same quarter last year [2] - Kilroy Realty has consistently surpassed consensus FFO estimates over the last four quarters, achieving this four times [2] 分组2 - The stock has underperformed the market, losing about 7.9% since the beginning of the year, while the S&P 500 has gained 2.5% [3] - The current consensus FFO estimate for the upcoming quarter is $1.04 on revenues of $276.31 million, and for the current fiscal year, it is $4.16 on revenues of $1.11 billion [7] - The Zacks Industry Rank indicates that the REIT and Equity Trust - Other sector is in the bottom 32% of over 250 Zacks industries, suggesting potential challenges for stock performance [8]

Financial Performance - Revenues for Q4 2024 were $286.4 million, up 6.5% from $269.0 million in Q4 2023[6] - Net income available to common stockholders for Q4 2024 was $59.5 million, or $0.50 per diluted share, compared to $47.3 million, or $0.40 per diluted share in Q4 2023[6] - Funds from operations (FFO) for Q4 2024 were $144.9 million, or $1.20 per diluted share, an increase from $129.3 million, or $1.08 per diluted share in Q4 2023[6] - For the full year 2024, total revenues were $1,135.6 million, slightly up from $1,129.7 million in 2023[9] - The company expects Nareit FFO for the full year 2025 to be between $3.85 and $4.05 per diluted share[11] - The company sold its corporate aircraft in November 2024 for gross proceeds of $19.8 million, resulting in a gain of approximately $6.0 million[5] - Total expenses for the year ended December 31, 2024, were $801.1 million, slightly up from $799.8 million in 2023[38] - The company reported a weighted average of 119.7 million common shares outstanding for the year ended December 31, 2024[38] Leasing Activity - Leasing activity in Q4 2024 reached approximately 708,000 square feet, the highest quarterly leasing volume since Q4 2019[6] - The company signed approximately 1,778,000 square feet of leases in 2024, the highest annual leasing volume since 2019[9] - In Q4 2024, the company executed 20 new leases totaling 555,252 square feet, with a weighted average lease term of 69 months[64] - Year-to-date, the company signed 76 leases totaling 1,417,287 square feet, with 66 new leases accounting for 950,507 square feet[64] Portfolio Occupancy - The stabilized portfolio was 82.8% occupied and 84.9% leased as of December 31, 2024[6] - The average occupancy for the total same store portfolio decreased to 83.5% in Q4 2024 from 86.1% in Q4 2023[43] - The stabilized portfolio's average occupancy rate was 82.8% as of December 31, 2024, down from 84.3% at the end of Q3 2024[46] - The company continues to focus on stabilizing its portfolio and improving occupancy rates across various regions[46] Financial Health and Liquidity - The company had approximately $1.3 billion in total liquidity as of December 31, 2024, including $0.2 billion in cash and cash equivalents[9] - The company has a total debt of $4,631,688 thousand, representing 49.0% of total market capitalization[100] - The weighted average stated rate of total debt is 4.17% as of December 31, 2024[100] - The company maintains a fixed charge coverage ratio of 3.3x, exceeding the covenant requirement of greater than 1.5x[109] Development and Future Outlook - The company is actively involved in future development projects, indicating a commitment to growth and market expansion[22] - Total estimated investment for ongoing projects is $1,025 million with 875,000 rentable square feet under construction, expected to stabilize by Q1 2026[92] - Future development pipeline includes approximately 3,800,000 square feet of developable space with total cash costs incurred as of December 31, 2024, amounting to $1,378 million[96] - The company continues to focus on market expansion and potential acquisitions to enhance portfolio performance[41] Risk Factors - The company faces various risks including economic conditions, tenant defaults, and competition, which could impact future performance[22] Key Metrics - The Net Operating Income Margin improved to 68.5%, compared to 67.8% in Q3 2024[25] - The Company uses Net Operating Income (NOI) as a performance measure to evaluate operating performance, reflecting consolidated revenues and expenses directly associated with owning and operating commercial real estate[115] - Funds Available for Distribution (FAD) is computed by adjusting FFO for recurring tenant improvements and capital expenditures, providing insights into the Company's liquidity[127]

Group 1 - The article discusses the current volatility in the stock market at the beginning of 2025, highlighting the potential opportunities for value investors to acquire dividend stocks at lower prices [2] - Kilroy Realty is mentioned as a focus for investment, indicating a preference for defensive stocks with a medium- to long-term investment horizon [2] - The article emphasizes the importance of sustainable portfolio income, diversification, and inflation hedging in income-focused investing [1] Group 2 - The author has a beneficial long position in Kilroy Realty shares, indicating confidence in the stock's performance [3] - The article serves as an informational piece rather than financial advice, encouraging readers to conduct their own due diligence [4] - Seeking Alpha clarifies that past performance does not guarantee future results and that the views expressed may not reflect the platform's overall stance [5]

Core Viewpoint - Kilroy Realty Corporation (NYSE: KRC) is rated as a Buy for income-focused investors interested in real estate investment trusts (REITs) despite its struggles due to exposure to the office market [1] Company Analysis - Kilroy Realty Corporation has been negatively impacted by its exposure to the office market, leading to a decline in its stock performance [1] - The company is viewed as a potential investment opportunity for those seeking income through REITs [1] Analyst Background - The analysis is provided by David A. Johnson, who has over 30 years of investment experience and holds advanced degrees in finance and business administration [1]

I am an experienced financial analyst and a former writer for Fade The Market on Seeking Alpha, with a passion for numbers and a knack for unraveling complex financial data. Armed with a strong financial modeling and data analysis background, I thrive on providing accurate insights and recommendations to drive informed financial decisions. I possess a keen eye for detail and possess a solid understanding of market trends and economic indicators. My expertise lies in evaluating investment opportunities, asse ...

Friday was a good day to be an investor in commercial real estate company Kilroy Realty (KRC 4.09%). On news of an analyst upgrade, accompanied by a price-target bump, Kilroy's stock zoomed to close the trading session more than 4% higher. That handily beat the performance of the benchmark S&P 500 index, which rose by slightly over 1%.A new bull says buyWell before market open, JPMorgan Chase's Anthony Paolone shifted his recommendation on Kilroy's shares to overweight (i.e., buy) from neutral. The pundit a ...

Revenue and Financial Performance - Revenues grew 2.2% to $289.9 million for Q3 2024 compared to $283.6 million in Q3 2023[3] - Net income available to common stockholders was $0.44 per diluted share, slightly down from $0.45 in Q3 2023[3] - Funds from operations (FFO) increased 4.5% to $140.4 million, or $1.17 per diluted share, compared to $134.0 million, or $1.12 per diluted share, in Q3 2023[3] - Revenues for Q3 2024 increased to $289.938 million, up 3.3% from $280.731 million in Q2 2024[12] - Net Income Available to Common Stockholders rose to $52.378 million in Q3 2024, a 6.4% increase from $49.211 million in Q2 2024[12] - EBITDA, as adjusted, reached $185.960 million in Q3 2024, up 4.2% from $178.461 million in Q2 2024[12] - Funds From Operations (FFO) increased to $140.448 million in Q3 2024, a 5.9% rise from $132.587 million in Q2 2024[12] - Total revenues for Q3 2024 were $289.9 million, compared to $280.7 million in Q2 2024 and $283.6 million in Q3 2023[14] - Net income available to common stockholders for Q3 2024 was $52.4 million, compared to $49.2 million in Q2 2024 and $52.8 million in Q3 2023[14] - Funds From Operations (FFO) for Q3 2024 were $140.4 million, compared to $132.6 million in Q2 2024 and $134.0 million in Q3 2023[15] - FFO per common share/unit for Q3 2024 was $1.17 (basic) and $1.17 (diluted), compared to $1.10 (basic) and $1.10 (diluted) in Q2 2024[15] - Funds Available for Distribution (FAD) for Q3 2024 were $96.8 million, compared to $114.8 million in Q2 2024 and $118.7 million in Q3 2023[15] - Total operating revenues for Q3 2024 increased by 2.2% to $289.9 million compared to $283.6 million in Q3 2023[16] - Rental income for Q3 2024 grew by 1.1% to $234.1 million from $231.6 million in Q3 2023[16] - Tenant reimbursements for Q3 2024 rose by 5.6% to $51.8 million compared to $49.1 million in Q3 2023[16] - Other property income for Q3 2024 surged by 36.9% to $4.0 million from $2.9 million in Q3 2023[16] - Net Operating Income for Q3 2024 increased by 1.7% to $196.7 million compared to $193.4 million in Q3 2023[16] - Same Store operating revenues for Q3 2024 increased by 2.8% to $272.3 million from $264.8 million in Q3 2023[17] - Same Store Cash Net Operating Income for Q3 2024 grew by 2.7% to $183.6 million compared to $178.8 million in Q3 2023[17] - Net Income Available to Common Stockholders for Q3 2024 was $52.378 million, compared to $52.762 million in Q3 2023[64] - Net Operating Income for Q3 2024 was $196.691 million, slightly down from $193.396 million in Q3 2023[64] - Same Store Net Operating Income for Q3 2024 was $188.564 million, up from $172.344 million in Q3 2023[64] - EBITDA, as adjusted for Q3 2024 was $185.960 million, compared to $173.798 million in Q3 2023[66] - Company's share of EBITDA, as adjusted for Q3 2024 was $178.475 million, up from $165.408 million in Q3 2023[66] - Funds Available for Distribution (FAD) for Q3 2024 was $96.82 million, down from $118.70 million in Q3 2023[67] - Total Funds Available for Distribution for the nine months ended September 30, 2024, was $336.98 million, compared to $370.78 million for the same period in 2023[67] Occupancy and Leasing - Stabilized portfolio occupancy was 84.3% with a leased rate of 85.8% as of September 30, 2024[4] - Signed approximately 436,000 square feet of leases in Q3 2024, including 209,000 square feet of short-term leasing[4] - GAAP rents on signed leases increased 26.0% and cash rents increased 7.1% from prior levels, excluding short-term leasing[4] - Period End Occupancy Percentage improved to 84.3% in Q3 2024, up from 83.7% in Q2 2024[12] - Average occupancy for Q3 2024 was 84.6%, down from 86.1% in Q3 2023[18] - Same Store rental income for Q3 2024 increased by 0.7% to $224.5 million from $223.0 million in Q3 2023[18] - Same Store property expenses for Q3 2024 rose by 6.4% to $61.2 million compared to $57.5 million in Q3 2023[18] - Stabilized portfolio occupancy in Los Angeles increased to 76.7% as of 9/30/2024, up from 73.9% at 6/30/2024[19] - Hollywood / West Hollywood submarket achieved 85.8% occupancy, with a leased rate of 86.1% as of 9/30/2024[19] - El Segundo submarket occupancy improved to 81.8% as of 9/30/2024, up from 74.4% at 6/30/2024[19] - San Diego's stabilized portfolio occupancy reached 87.9% as of 9/30/2024, with Del Mar submarket at 96.4% occupancy[19] - San Francisco Bay Area stabilized portfolio occupancy stood at 91.1% as of 9/30/2024, with Silicon Valley and South San Francisco at 100% occupancy[19] - Seattle's stabilized portfolio occupancy was 80.4% as of 9/30/2024, with Bellevue submarket at 94.4% occupancy[19] - Austin CBD submarket occupancy increased to 74.2% as of 9/30/2024, up from 72.3% at 6/30/2024[19] - Total stabilized portfolio occupancy across all regions was 84.3% as of 9/30/2024, with a leased rate of 85.8%[19] - 1350 Ivar Avenue in Hollywood / West Hollywood maintained 100% occupancy as of 9/30/2024[20] - 2240 E. Imperial Highway in El Segundo maintained 100% occupancy as of 9/30/2024[20] - San Diego total occupancy rate at 9/30/2024 is 87.9%, with a leased rate of 90.5%[21] - San Francisco Bay Area total occupancy rate at 9/30/2024 is 91.1%, with a leased rate of 91.7%[22] - 12348 High Bluff Drive in San Diego has an occupancy rate of 51.5% at 9/30/2024[21] - 12707 High Bluff Drive in San Diego has an occupancy rate of 93.5% at 9/30/2024[21] - 3579 Valley Centre Drive in San Diego shows a decline in occupancy from 94.7% at 6/30/2024 to 87.0% at 9/30/2024[21] - 3721 Valley Centre Drive in San Diego has an occupancy rate of 78.9% at 9/30/2024, with a leased rate of 90.3%[21] - 2100 Kettner Boulevard in San Diego has a low occupancy rate of 22.6% at 9/30/2024[21] - 100 Hooper Street in San Francisco Bay Area has an occupancy rate of 95.5% at 9/30/2024[22] - 303 Second Street in San Francisco Bay Area has an occupancy rate of 73.5% at 9/30/2024[22] - 4200 Bohannon Drive in San Francisco Bay Area has an occupancy rate of 69.4% at 9/30/2024[22] - Total stabilized portfolio occupancy rate is 84.3% as of 9/30/2024, with a leased rate of 85.8%[23] - Seattle portfolio occupancy rate is 80.4%, with a leased rate of 81.6%[23] - Austin portfolio occupancy rate is 74.2%, with a leased rate of 80.7%[23] - Residential properties average occupancy rate is 92.0% as of 9/30/2024[24] - Total 2nd generation leasing for Q3 2024 includes 261,062 square feet with a weighted average lease term of 80 months[25] - Changes in GAAP rents for Q3 2024 are 48.3%, while changes in cash rents are 22.4%[25] - Retention Rates (Leases Executed) measure the percentage of space renewed by existing tenants at lease expiration or termination[60] Capital Expenditures and Investments - Acquired Junction at Del Mar, a 104,000 square foot office property in San Diego, for $35.0 million, which is 96% leased with a weighted average lease term of 4.7 years[4] - Total capital expenditures for 2nd generation improvements are $25.66 million for Q3 2024[27] - Major repositioning capital expenditures total $4.30 million for Q3 2024[28] - 1st generation capital expenditures for tenant improvements and leasing commissions are $1.43 million for Q3 2024[28] - Average capital expenditures to average NOI ratio is 11.7% for the trailing five quarters[27] - The company acquired two buildings in Del Mar during Q3 2024, totaling 103,731 rentable square feet for $35.0 million[35] - Consolidated property ventures with Norges Bank Real Estate Management in San Francisco total 1,265,115 rentable square feet, with 56% ownership[36] - Year-to-date net operating income for consolidated ventures is $64.416 million, with adjustments leading to a cash net operating income of $63.684 million[37] - In-process development projects total 100,000 rentable square feet with an estimated investment of $80 million, currently 0% leased[38] - Kilroy Oyster Point - Phase 2, under construction, will add 875,000 rentable square feet with a total estimated investment of $1.0 billion[39] - Future development pipeline includes projects totaling approximately 5,733,000 square feet and 1,750 residential units, with $1.356 billion in cash costs incurred as of 9/30/2024[40] - Recurring tenant improvements, leasing commissions, and capital expenditures totaled $25.66 million in Q3 2024, up from $20.52 million in Q3 2023[67] Debt and Financial Ratios - Total liquidity as of September 30, 2024, was approximately $1.7 billion, including $0.6 billion in cash and $1.1 billion available under the unsecured revolving credit facility[4] - Total debt as of September 30, 2024, is $5,036,923 thousand, representing 52.2% of total market capitalization[41] - Net debt to Company's share of EBITDA, as adjusted, is 6.4x as of September 30, 2024[43] - Total equity and noncontrolling interest in the operating partnership is $4,612,933 thousand, representing 47.8% of total market capitalization[41] - Weighted average stated rate for total debt is 4.13% as of September 30, 2024[41] - Net debt decreased to $4,411,528 thousand as of September 30, 2024, from $4,322,539 thousand as of June 30, 2024[43] - Total debt to total asset value covenant is 33%, well below the 60% limit as of September 30, 2024[44] - Fixed charge coverage ratio is 3.2x, exceeding the 1.5x covenant requirement as of September 30, 2024[44] - Unencumbered asset pool debt service coverage is 3.58x, surpassing the 1.75x covenant requirement as of September 30, 2024[44] - Interest coverage ratio is 5.1x, significantly above the 1.5x covenant requirement as of September 30, 2024[44] - Unencumbered asset pool value to unsecured debt is 282%, well above the 150% covenant requirement as of September 30, 2024[44] - Net Debt to Company's Share of EBITDA, as adjusted Ratio is a measure of borrowed capital used to increase real estate investment returns and assess debt repayment ability[51] Expenses and Costs - Property expenses for Q3 2024 were $63.6 million, compared to $59.3 million in Q2 2024 and $59.4 million in Q3 2023[14] - Depreciation and amortization for Q3 2024 were $91.9 million, compared to $87.2 million in Q2 2024 and $85.2 million in Q3 2023[14] - Interest expense for Q3 2024 was $36.4 million, compared to $36.8 million in Q2 2024 and $29.8 million in Q3 2023[14] - Recurring tenant improvements, leasing commissions, and capital expenditures for Q3 2024 were $25.7 million, compared to $22.1 million in Q2 2024 and $20.5 million in Q3 2023[15] - Interest expense for Q3 2024 was $36.408 million, compared to $29.837 million in Q3 2023[64] - Depreciation and amortization for Q3 2024 was $91.879 million, up from $85.224 million in Q3 2023[64] - General and administrative expenses for Q3 2024 were $18.066 million, down from $24.761 million in Q3 2023[64] - Depreciation of non-real estate furniture, fixtures, and equipment was $1.64 million in Q3 2024, slightly lower than $1.71 million in Q3 2023[67] Leasing and Tenant Metrics - Total expiring leases in 2024 account for 2.0% of total leased square feet, with an annualized base rent of $17,069 thousand, representing 2.1% of total ABR[29] - In 2025, expiring leases represent 5.4% of total leased square feet, with an annualized base rent of $33,134 thousand, accounting for 4.2% of total ABR[29] - For 2026, expiring leases make up 13.6% of total leased square feet, with an annualized base rent of $91,231 thousand, representing 11.4% of total ABR[29] - The San Francisco Bay Area has the highest expiring leases in 2026, with 945,807 square feet (6.8% of total leased square feet) and an annualized base rent of $49,543 thousand (6.2% of total ABR)[30] - In 2027, expiring leases account for 7.8% of total leased square feet, with an annualized base rent of $44,373 thousand, representing 5.6% of total ABR[29] - The San Francisco Bay Area leads in 2028 with 730,462 square feet (5.2% of total leased square feet) and an annualized base rent of $49,244 thousand (6.2% of total ABR)[30] - For 2029 and beyond, expiring leases represent 62.9% of total leased square feet, with an annualized base rent of $540,815 thousand, accounting for 67.7% of total ABR[29] - The San Francisco Bay Area dominates in 2029 and beyond, with 3,450,764 square feet (24.8% of total leased square feet) and an annualized base rent of $257,088 thousand (32.2% of total ABR)[30] - Los Angeles has significant expiring leases in 2029 and beyond, with 1,419,998 square feet (10.2% of total leased square feet) and an annualized base rent of $81,371 thousand (10.2% of total ABR)[30] - Seattle's expiring leases in 2029 and beyond total 1,697,982 square feet (12.2% of total leased square feet) with an annualized base rent of $78,027 thousand (9.8% of total ABR)[30] - Top 20 tenants contribute $428.742 million in annualized base rental revenue, representing 53.6% of total annualized base rental revenue and 42.5% of total rentable square feet[32] - The largest tenant, a global technology company, contributes $44.851 million annually, accounting for 5.6% of total annualized base rental revenue and 5.0% of total rentable square feet[32] - Technology sector tenants account for 54% of annualized base rent and 51% of rentable square feet, highlighting strong sector diversification[34] Portfolio and Asset Management - Total real