Kilroy Realty Corporation reported a net loss of $14.7 million for the first quarter of 2026, a significant decline from a net income of $43.7 million in the same period last year. This resulted in a net loss per share of $0.16, compared to earnings of $0.33 per share in the prior year. Total revenues for the quarter were $270.1 million, slightly down from $270.8 million in the first quarter of 2025. The decrease in profitability was attributed to an impairment charge of $61.8 million related to real estate assets held for sale and increased interest expenses, which rose to $38.5 million from $31.1 million year-over-year.
In terms of operational metrics, Kilroy Realty's rental income decreased marginally to $265.3 million from $266.2 million, while other property income increased to $4.7 million from $4.6 million. The company's total expenses rose to $209.3 million, up from $197.0 million in the previous year, driven by higher depreciation and amortization costs, which increased to $94.3 million from $87.1 million. The company also reported a total of 123 stabilized properties with an aggregate of approximately 17.1 million rentable square feet as of March 31, 2026, reflecting a slight increase in the number of properties compared to the previous quarter.
Kilroy Realty engaged in strategic asset management during the quarter, completing the sale of two operating properties for gross proceeds of approximately $145.5 million. The company also classified two residential properties as held for sale, with a gross sales price of $202.0 million expected from their sale, which closed in April 2026. The company’s cash and cash equivalents increased to $192.9 million, up from $179.3 million at the end of 2025, indicating improved liquidity.
Looking ahead, Kilroy Realty remains focused on its capital recycling strategy, which involves disposing of non-core assets to reinvest in higher-return opportunities. The company has committed to significant future development projects, including a new office project in Redwood City, California, with an estimated total cost of $36 million. The company also plans to spend between $100 million to $150 million on development projects throughout the remainder of 2026. Despite the current challenges, Kilroy Realty's management expressed confidence in the company's ability to navigate market conditions and maintain its operational performance.
About KILROY REALTY CORP
Kilroy Realty Corporation is a REIT specializing in the ownership, development, and management of office, life science, and mixed-use properties primarily in California, Washington, and Texas. It focuses on modern, sustainable buildings that attract technology, life sciences, and business tenants. The company emphasizes long-term growth through development, redevelopment, and strategic capital recycling, leveraging strong tenant relationships and sustainability leadership to deliver value.
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