Kilroy Realty Corporation Reports 45.9% Increase in Net Income for Q2 2025

Kilroy Realty Corporation reported a net income of $79.6 million for the second quarter of 2025, a significant increase of 45.9% compared to $54.5 million in the same period last year. For the first half of 2025, net income reached $123.2 million, up 11.8% from $110.2 million in the prior year. The company’s total revenues for the second quarter were $289.9 million, reflecting a 3.9% increase from $280.7 million in the second quarter of 2024. Rental income, a key revenue driver, rose to $285.1 million, compared to $275.9 million in the previous year, while other property income remained stable at $4.8 million.

Kilroy Realty's financial position showed some changes compared to the end of 2024. Total assets decreased slightly to $10.87 billion from $10.90 billion, primarily due to a reduction in real estate assets held for investment, which fell to $9.54 billion from $9.83 billion. The company’s total liabilities also decreased marginally to $5.27 billion from $5.29 billion. Notably, cash and cash equivalents increased to $193.1 million from $165.7 million, indicating improved liquidity.

Strategically, Kilroy Realty executed the sale of one operating property for $40 million during the first half of 2025, contributing to a gain of $16.6 million. The company also classified a four-building office property in Silicon Valley as held for sale, with an expected sales price of $365 million, anticipated to close in the third quarter of 2025. The company continues to focus on its capital recycling strategy, evaluating opportunities for the disposition of non-core properties and undeveloped land to fund new acquisitions and developments.

Operationally, Kilroy Realty's stabilized portfolio comprised 118 properties with approximately 16.4 million rentable square feet as of June 30, 2025. The average occupancy rate across its portfolio was reported at 80.8%. The company’s leasing activity included 221 leases executed in the second quarter, totaling 345,943 square feet, with a weighted average lease term of 54 months. The retention rate for the quarter was 32.5%, indicating a slight decline from previous periods.

Looking ahead, Kilroy Realty remains optimistic about its growth prospects, with plans to continue its development and redevelopment projects, which include a significant life science campus in South San Francisco. The company is also evaluating potential acquisitions and expects to maintain its financial flexibility through its available liquidity and capital resources. However, it acknowledges the potential impact of economic conditions on its operations and financial performance.