Kilroy Realty Corp. has closed on the disposition of its entire industrial portfolio and two small office projects, which in aggregate total approximately 3.7 million sq. ft. As part of the company’s capital recycling strategy, the company sold 44 properties for gross proceeds of approximately $355 million in two tranches to two institutional buyers.
The purchase price reflects strong investor demand for well-located, well-leased, coastal assets. The company will reinvest the proceeds into its expanding West Coast office development program and anticipates recording an approximate $185 million gain on sale in the fourth quarter.
“These transactions reflect a milestone for the company as it moves forward with its value creation strategy of acquiring, repositioning, redeveloping and developing high quality office space in the best West Coast markets,” Kilroy President & CEO John Kilroy Jr. said in a statement.
Kilroy originally disclosed the disposition as part of reporting its third quarter results in late October.
Since the beginning of 2012, KRC has completed the purchase of 13 office buildings in six transactions aggregating approximately 1.7 million sq. ft. of space for an aggregate purchase price of approximately $645 million.
The company also has added four individual projects to its development and redevelopment pipeline, acquiring the four projects for an aggregate purchase price of approximately $210 million. The company estimates that its total investment, including land, in these four development and redevelopment projects will aggregate approximately $846 million.