Exhibit 99.1

Second Quarter 2011 Supplemental Financial Report

Some of the enclosed information presented in this supplemental and on the Company’s July 26, 2011 conference call is forward-looking in nature, including information concerning project development timing and investment amounts. Although the information is based on Kilroy Realty Corporation’s current expectations, actual results could vary from expectations stated here. Numerous factors will affect Kilroy Realty Corporation’s actual results, some of which are beyond its control. These include the timing and strength of regional economic growth, the strength of commercial and industrial real estate markets, competitive market conditions, future interest rate levels, our ability to complete and successfully integrate pending and recent acquisitions, and capital market conditions. You are cautioned not to place undue reliance on this information, which speaks only as of the date of this report. Kilroy Realty Corporation assumes no obligation to update publicly any forward-looking information, whether as a result of new information, future events or otherwise, except to the extent it is required to do so in connection with its ongoing requirements under Federal securities laws to disclose material information. For a discussion of important risks related to Kilroy Realty Corporation’s business, and an investment in its securities, including risks that could cause actual results and events to differ materially from results and events referred to in the forward-looking information, see the discussion under the caption “Risk Factors” in Kilroy Realty Corporation’s annual report on Form 10-K for the year ended December 31, 2010. In light of these risks, uncertainties and assumptions, the forward-looking events contained in this supplemental information and on the Company’s July 26, 2011 conference call might not occur.

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Table of Contents

	Page
Corporate Data and Financial Highlights
Company Background		1
Financial Highlights		2
Common Stock Data		3
Consolidated Balance Sheets		4
Consolidated Statements of Operations		5
Funds From Operations and Funds Available for Distribution		6
Portfolio Data
Same Store Analysis		7
Stabilized Portfolio Occupancy Overview		8-14
Submarket Statistics		15
Lease Commencement Information		16
Stabilized Portfolio Capital Expenditures		17
Lease Expiration Summary and Lease Expirations by Region		18-21
Top Fifteen Tenants		22
2011 Acquisitions		23
Development
In-Process Redevelopment Projects		24
Future Development Pipeline		25
Debt and Capitalization Data
Capital Structure		26
Debt Analysis		27-28
Debt Covenants		29
Non-GAAP Supplemental Measures		30-34

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Company Background

Kilroy Realty Corporation (NYSE: KRC), a member of the S&P Small Cap 600 Index, is a real estate investment trust active in the premier office and industrial submarkets along the West Coast. The Company owns, develops, acquires and manages real estate assets primarily in the coastal regions of Los Angeles, Orange County, San Diego County, greater Seattle, and the San Francisco Bay Area. As of June 30, 2011, the Company’s stabilized portfolio consisted of 107 office buildings and 40 industrial buildings, which encompassed an aggregate of 11.5 million and 3.6 million rentable square feet, respectively, and was 90.2% occupied.

Board of Directors	Senior Management		Investor Relations
John B. Kilroy, Sr.           Chairman	John B. Kilroy, Jr.	President and CEO	12200 W. Olympic Blvd., Suite 200
Edward F. Brennan, Ph.D.	Chris Corpuz	Executive VP, Strategic Initiatives	Los Angeles, CA 90064 (310) 481-8400
William P. Dickey	Jeffrey C. Hawken	Executive VP and COO	Web: www.kilroyrealty.com E-mail: investorrelations@kilroyrealty.com
Scott S. Ingraham	Eli Khouri	Executive VP and CIO
John B. Kilroy, Jr.	Tyler H. Rose	Executive VP and CFO
Dale F. Kinsella	John T. Fucci	Sr. VP, Asset Management
	Heidi R. Roth	Sr. VP and Controller
	Steve Scott	Sr. VP, San Diego
	Justin W. Smart	Sr. VP, Development

	Equity Research Coverage
Bank of America Merrill Lynch		ISI Group
James Feldman	(646) 855-5808	Steve Sakwa	(212) 446-9462
Citigroup Investment Research		JMP Securities
Michael Bilerman	(212) 816-1383	Mitch Germain	(212) 906-3546
Cowen and Company		J.P. Morgan
James Sullivan	(646) 562-1380	Anthony Paolone	(212) 622-6682
Credit Suisse Group		RBC Capital Markets
Andrew Rosivach	(415) 249-7942	Dave Rodgers	(440) 715-2647
Deutsche Bank Securities, Inc.		Robert W. Baird & Company
John N. Perry	(212) 250-4912	David Aubuchon	(314) 863-4235
FBR Capital Markets		Stifel, Nicolaus & Company
Srikanth Nagarajan	(646) 885-5429	John W. Guinee III	(443) 224-1307
Green Street Advisors		UBS Investment Research
Michael Knott	(949) 640-8780	Ross T. Nussbaum	(212) 713-2484

Kilroy Realty Corporation is followed by the analysts listed above. Please note that any opinions, estimates or forecasts regarding Kilroy Realty Corporation’s performance made by these analysts are theirs alone and do not represent opinions, forecasts or predictions of Kilroy Realty Corporation or its management. Kilroy Realty Corporation does not by its reference above or distribution imply its endorsement of or concurrence with such information, conclusions or recommendations.

1

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Financial Highlights
(unaudited, $ in thousands, except per share amounts)

	Three Months Ended
	6/30/2011			3/31/2011			12/31/2010			9/30/2010			6/30/2010
INCOME ITEMS (Including Discontinued Operations):
Revenues	$	92,064		$	88,125		$	82,941		$	79,804		$	72,416
Lease Termination Fees		280			280			277			186			303
Net Operating Income (1)		65,524			61,902			59,804			56,866			51,033
Capitalized Interest and Debt Costs		2,065			1,979			1,932			2,690			2,810
Net Income (Loss) Available to Common Stockholders		(317	)		1,034			1,535			(126	)		(1,783	)
EBITDA (1)(2)(3)		56,948			55,054			52,574			49,576			43,330
Funds From Operations (1)(4)(5)		31,643			30,127			29,485			29,690			21,658
Funds Available for Distribution (1)(4)(5)		18,048			19,843			15,919			14,760			10,695
Net (Loss) Income Available to Common Stockholders per common share — diluted	$	(0.01	)	$	0.01		$	0.02		$	(0.01	)	$	(0.04	)
Funds From Operations per common share — diluted	$	0.52		$	0.55		$	0.54		$	0.54		$	0.41
Dividends per share	$	0.35		$	0.35		$	0.35		$	0.35		$	0.35
RATIOS (Including Discontinued Operations):
Operating Margins		71.2	%		70.2	%		72.1	%		71.3	%		70.5	%
Interest Coverage Ratio (6)		2.9x			2.9x			3.1x			3.4x			3.5x
Fixed Charge Coverage Ratio (7)		2.4x			2.4x			2.5x			2.7x			2.7x
FFO Payout Ratio (8)		66.6	%		62.9	%		64.2	%		63.7	%		87.3	%
FAD Payout Ratio (9)		116.7	%		95.5	%		118.9	%		128.0	%		176.8	%

	6/30/2011			3/31/2011			12/31/2010			9/30/2010			6/30/2010
ASSETS:
Real Estate Held for Investment before Depreciation	$	3,652,846		$	3,266,197		$	3,216,871		$	2,964,429		$	2,953,609
Total Assets		3,264,787			2,841,933			2,816,565			2,535,684			2,556,509
CAPITALIZATION:
Total Debt (10)	$	1,698,791		$	1,482,553		$	1,451,152		$	1,174,421		$	1,181,970
Total Preferred Equity and Noncontrolling Interests (10)		201,500			201,500			201,500			201,500			201,500
Total Common Equity and Noncontrolling Interests (10)		2,376,609			2,102,354			1,972,035			1,791,973			1,605,996
Total Market Capitalization (10)		4,276,900			3,786,407			3,624,687			3,167,894			2,989,466
Total Debt / Total Market Capitalization (10)		39.6	%		39.2	%		40.2	%		37.1	%		39.6	%
Total Debt and Preferred / Total Market Capitalization (10)		44.3	%		44.6	%		45.8	%		43.5	%		46.3	%

(1)	Please refer to pages 30 and 31 for Management Statements on Net Operating Income, EBITDA, Funds From Operations and Funds Available for Distribution.
(2)	Please refer to page 33 for a reconciliation of GAAP Net (Loss) Income Available to Common Stockholders to EBITDA.
(3)	EBITDA for all periods presented includes the impact of acquisition-related expenses. Acquisition-related expenses for the three months ended June 30, 2011 were $1.2 million.
(4)	Please refer to page 6 for a reconciliation of GAAP Net (Loss) Income Available to Common Stockholders to Funds From Operations and Funds Available for Distribution.
(5)	Reported amounts are attributable to common stockholders and common unitholders.
(6)	Calculated as EBITDA divided by interest expense (excluding amortization of deferred debt costs and debt discounts).
(7)	Calculated as EBITDA divided by interest expense (excluding amortization of deferred debt costs and debt discounts), current year accrued preferred dividends and distributions on Cumulative Redeemable Preferred units.
(8)	Calculated as current-quarter dividends accrued to common stockholders and common unitholders (excluding dividend equivalents accrued to restricted stock unitholders) divided by Funds From Operations.
(9)	Calculated as current-quarter dividends accrued to common stockholders and common unitholders (excluding dividend equivalents accrued to restricted stock unitholders) divided by Funds Available for Distribution.
(10)	See “Capital Structure” on page 26.

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Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Common Stock Data (NYSE: KRC)

	Three Months Ended
	6/30/2011		3/31/2011		12/31/2010		9/30/2010		6/30/2010
High Price	$	41.94	$	39.24	$	36.72	$	34.39	$	36.72
Low Price	$	38.04	$	36.61	$	32.64	$	27.54	$	29.73
Closing Price	$	39.49	$	38.83	$	36.47	$	33.14	$	29.73
Dividends per share — annualized	$	1.40	$	1.40	$	1.40	$	1.40	$	1.40
Closing common shares (in 000’s) (1)(2)		58,464		52,419		52,350		52,350		52,296
Closing common partnership units (in 000’s) (1)		1,718		1,723		1,723		1,723		1,723
		60,182		54,142		54,073		54,073		54,019

(1)	As of the end of the period.
(2)	In April 2011, the Company completed an underwritten public offering of 6,037,500 shares of its common stock at $38.25 per share.

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Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Consolidated Balance Sheets
(unaudited, $ in thousands)

	6/30/2011			3/31/2011			12/31/2010			9/30/2010			6/30/2010
ASSETS:
Land and improvements	$	528,082		$	498,963		$	491,333		$	432,289		$	434,792
Buildings and improvements		2,820,766			2,470,989			2,435,173			2,245,618			2,247,549
Undeveloped land and construction in progress		303,998			296,245			290,365			286,522			271,268
Total real estate held for investment		3,652,846			3,266,197			3,216,871			2,964,429			2,953,609
Accumulated depreciation and amortization		(720,864	)		(695,548	)		(672,429	)		(652,675	)		(644,246	)
Total real estate assets, net		2,931,982			2,570,649			2,544,442			2,311,754			2,309,363
Cash and cash equivalents		25,412			6,708			14,840			8,313			29,428
Restricted cash		1,349			1,899			1,461			3,265			3,485
Marketable securities		5,654			5,425			4,902			4,481			4,087
Current receivables, net		4,732			4,816			6,258			4,055			3,739
Deferred rent receivables, net		97,958			93,392			89,052			83,563			79,813
Note receivable		—			—			—			—			10,603
Deferred leasing costs and acquisition-related intangible assets, net		153,231			129,578			131,066			96,691			98,466
Deferred financing costs, net		18,910			15,742			16,447			14,574			10,078
Prepaid expenses and other assets, net		25,559			13,724			8,097			8,988			7,447
TOTAL ASSETS	$	3,264,787		$	2,841,933		$	2,816,565		$	2,535,684		$	2,556,509
LIABILITIES, NONCONTROLLING INTEREST AND EQUITY:
Liabilities:
Secured debt, net	$	475,820		$	446,539		$	313,009		$	315,150		$	316,570
Exchangeable senior notes, net		303,374			301,652			299,964			298,295			296,660
Unsecured senior notes, net		655,929			655,866			655,803			330,941			391,888
Unsecured line of credit		245,000			57,000			159,000			205,000			150,000
Accounts payable, accrued expenses and other liabilities		66,664			78,847			68,525			66,814			57,792
Accrued distributions		22,563			20,443			20,385			20,383			20,395
Deferred revenue and acquisition-related intangible liabilities, net		90,149			78,992			79,322			68,251			71,651
Rents received in advance and tenant security deposits		28,117			26,433			29,189			23,776			25,849
Total liabilities		1,887,616			1,665,772			1,625,197			1,328,610			1,330,805
Noncontrolling Interest:
7.45% Series A Cumulative Redeemable Preferred units of the Operating Partnership		73,638			73,638			73,638			73,638			73,638
Equity:
Stockholders’ Equity
7.80% Series E Cumulative Redeemable Preferred stock		38,425			38,425			38,425			38,425			38,425
7.50% Series F Cumulative Redeemable Preferred stock		83,157			83,157			83,157			83,157			83,157
Common stock		585			524			523			523			523
Additional paid-in capital		1,433,951			1,214,463			1,211,498			1,209,673			1,208,716
Distributions in excess of earnings		(285,916	)		(264,848	)		(247,252	)		(230,215	)		(211,555	)
Total stockholders’ equity		1,270,202			1,071,721			1,086,351			1,101,563			1,119,266
Noncontrolling Interest
Common units of the Operating Partnership		33,331			30,802			31,379			31,873			32,800
Total equity		1,303,533			1,102,523			1,117,730			1,133,436			1,152,066
TOTAL LIABILITIES, NONCONTROLLING INTEREST AND EQUITY	$	3,264,787		$	2,841,933		$	2,816,565		$	2,535,684		$	2,556,509

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Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Consolidated Statements of Operations
(unaudited, $ in thousands, except per share amounts)

	Three Months Ended June 30,									Six Months Ended June 30,
	2011			2010			%Change			2011			2010			%Change
REVENUES:
Rental income	$	83,452		$	65,038			28.3	%	$	163,742		$	125,694			30.3	%
Tenant reimbursements		7,510			6,483			15.8	%		13,932			12,201			14.2	%
Other property income		1,102			895			23.1	%		2,515			1,340			87.7	%
Total revenues		92,064			72,416			27.1	%		180,189			139,235			29.4	%
EXPENSES:
Property expenses		17,583			14,543			20.9	%		35,272			26,563			32.8	%
Real estate taxes		8,413			6,482			29.8	%		16,582			12,518			32.5	%
Provision for bad debts		120			(12	)		1,100.0	%		146			14			942.9	%
Ground leases		424			370			14.6	%		763			312			144.6	%
General and administrative expenses		7,440			6,728			10.6	%		14,000			13,823			1.3	%
Acquisition-related expenses		1,194			957			24.8	%		1,666			1,270			31.2	%
Depreciation and amortization		32,248			23,722			35.9	%		61,559			44,660			37.8	%
Total expenses		67,422			52,790			27.7	%		129,988			99,160			31.1	%
OTHER (EXPENSES) INCOME:
Interest income and other net investment gains (losses)		58			(18	)		422.2	%		242			366			(33.9	)%
Interest expense		(21,228	)		(13,088	)		62.2	%		(42,104	)		(25,044	)		68.1	%
Loss on early extinguishment of debt		—			(4,564	)		(100.0	)%		—			(4,564	)		(100.0	)%
Total other (expenses) income		(21,170	)		(17,670	)		19.8	%		(41,862	)		(29,242	)		43.2	%
NET INCOME		3,472			1,956			77.5	%		8,339			10,833			(23.0	)%
Net loss (income) attributable to noncontrolling common units of the Operating Partnership		10			60			(83.3	)%		(24	)		(132	)		(81.8	)%
NET INCOME ATTRIBUTABLE TO KILROY REALTY CORPORATION		3,482			2,016			72.7	%		8,315			10,701			(22.3	)%
PREFERRED DISTRIBUTIONS AND DIVIDENDS:
Distributions on noncontrolling cumulative redeemable preferred units of the Operating Partnership		(1,397	)		(1,397	)		—	%		(2,794	)		(2,794	)		—	%
Preferred dividends		(2,402	)		(2,402	)		—	%		(4,804	)		(4,804	)		—	%
Total preferred distributions and dividends		(3,799	)		(3,799	)		—	%		(7,598	)		(7,598	)		—	%
NET (LOSS) INCOME AVAILABLE TO COMMON STOCKHOLDERS	$	(317	)	$	(1,783	)		(82.2	)%	$	717		$	3,103			(76.9	)%
Weighted average common shares outstanding — basic		57,686			50,297			14.7	%		55,009			46,674			17.9	%
Weighted average common shares outstanding — diluted		57,686			50,297			14.7	%		55,385			46,678			18.7	%
NET (LOSS) INCOME AVAILABLE TO COMMON STOCKHOLDERS PER SHARE
Net (loss) income available to common stockholders per share — basic	$	(0.01	)	$	(0.04	)		(73.1	)%	$	0.00		$	0.05			(97.7	)%
Net (loss) income available to common stockholders per share — diluted	$	(0.01	)	$	(0.04	)		(73.1	)%	$	0.00		$	0.05			(97.7	)%

5

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Funds From Operations and Funds Available for Distribution
(unaudited, $ in thousands, except per share amounts)

	Three Months Ended June 30,									Six Months Ended June 30,
	2011			2010			%Change			2011			2010			%Change
FUNDS FROM OPERATIONS: (1)
Net (loss) income available to common stockholders	$	(317	)	$	(1,783	)		(82.2	)%	$	717		$	3,103			(76.9	)%
Adjustments:
Net (loss) income attributable to noncontrolling common units of the Operating Partnership		(10	)		(60	)		(83.3	)%		24			132			(81.8	)%
Depreciation and amortization of real estate assets		31,970			23,501			36.0	%		61,029			44,229			38.0	%
Funds From Operations (2)	$	31,643		$	21,658			46.1	%	$	61,770		$	47,464			30.1	%
Weighted average common shares/units outstanding — basic (3)		60,337			52,884			14.1	%		57,634			49,240			17.0	%
Weighted average common shares/units outstanding — diluted (3)		60,817			52,889			15.0	%		58,010			49,243			17.8	%
FFO per common share/unit — basic (2)	$	0.52		$	0.41			28.1	%	$	1.07		$	0.96			11.2	%
FFO per common share/unit — diluted (2)	$	0.52		$	0.41			27.1	%	$	1.06		$	0.96			10.5	%
FUNDS AVAILABLE FOR DISTRIBUTION: (1)
Funds From Operations (2)	$	31,643		$	21,658			46.1	%	$	61,770		$	47,464			30.1	%
Adjustments:
Tenant improvements, leasing commissions and recurring capital expenditures		(11,162	)		(13,957	)		(20.0	)%		(19,133	)		(25,918	)		(26.2	)%
Amortization of deferred revenue related to tenant improvements (4)		(2,342	)		(2,423	)		(3.3	)%		(4,668	)		(4,775	)		(2.2	)%
Net effect of straight-line rents (5)		(4,566	)		(3,406	)		34.1	%		(8,906	)		(5,421	)		64.3	%
Amortization of other deferred revenue, net (6)		(118	)		(151	)		(21.9	)%		(237	)		(201	)		17.9	%
Amortization of net above market rents (7)		745			60			1,141.7	%		1,398			32			4,268.8	%
Noncash amortization of exchangeable debt discount, net (8)		1,458			1,753			(16.8	)%		2,894			3,479			(16.8	)%
Noncash loss on early extinguishment of debt		—			4,564			(100.0	)%		—			4,564			(100.0	)%
Amortization of deferred financing costs and debt discounts/premiums		1,257			784			60.3	%		2,534			1,742			45.5	%
Noncash amortization of share-based compensation awards		1,133			1,813			(37.5	)%		2,239			3,519			(36.4	)%
Funds Available for Distribution (2)	$	18,048		$	10,695			68.8	%	$	37,891		$	24,485			54.8	%

(1)	See page 31 for Management Statements on Funds From Operations and Funds Available for Distribution.
(2)	Reported amounts are attributable to common shareholders and unitholders.
(3)	Calculated based on weighted average shares outstanding including participating share-based awards (i.e. restricted stock units) and assuming the exchange of all common limited partnership units outstanding.
(4)	Represents revenue recognized during the period as a result of the amortization of deferred revenue recorded for tenant-funded tenant improvements.
(5)	Represents the straight-line rent income recognized during the period offset by cash received during the period that was applied to deferred rents receivable balances for terminated leases and the provision for bad debts recorded for deferred rent receivable balances.
(6)	Represents amortization of deferred revenue related to cash received prior to or during the revenue recognition period in connection with tenants’ contractual lease obligations, net of such amounts received.
(7)	Represents the adjustment related to the acquisition of buildings with above and/or below market rents.
(8)	Represents the amortization of the noncash debt discounts on the Company’s exchangeable senior notes, net of amounts capitalized.

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Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Same Store Analysis ⁽¹⁾
(unaudited, $ in thousands)

Same Store Analysis (GAAP Basis) ⁽²⁾

	Three Months Ended June 30,									Six Months Ended June 30,
	2011			2010			%Change			2011			2010			%Change
Total Same Store Portfolio
Number of properties		129			129						129			129
Square Feet		11,834,931			11,834,931						11,834,931			11,834,931
Percent of Stabilized Portfolio		78.5	%		89.7	%					78.5	%		89.7	%
Average Occupancy		90.3	%		84.6	%					90.5	%		83.5	%
Operating Revenues:
Rental income	$	62,182		$	59,929			3.8	%	$	124,274		$	118,636			4.8	%
Tenant reimbursements		5,779			5,855			(1.3	)%		11,166			11,101			0.6	%
Other property income		1,082			694			55.9	%		2,440			1,139			114.2	%
Total operating revenues		69,043			66,478			3.9	%		137,880			130,876			5.4	%
Operating Expenses:
Property expenses		12,094			13,082			(7.6	)%		25,122			24,464			2.7	%
Real estate taxes		5,762			5,701			1.1	%		11,579			11,299			2.5	%
Provision for bad debts		120			(12	)		1,100.0	%		146			14			942.9	%
Ground leases		330			334			(1.2	)%		632			373			69.4	%
Total operating expenses		18,306			19,105			(4.2	)%		37,479			36,150			3.7	%
GAAP Net Operating Income	$	50,737		$	47,373			7.1	%	$	100,401		$	94,726			6.0	%

Same Store Analysis (Cash Basis) ⁽²⁾

	Three Months Ended June 30,							Six Months Ended June 30,
	2011		2010		%Change			2011		2010		%Change
Total operating revenues	$	63,943	$	60,764		5.2	%	$	126,944	$	120,772		5.1	%
Total operating expenses		18,186		19,117		(4.9	)%		37,333		36,136		3.3	%
Cash Net Operating Income	$	45,757	$	41,647		9.9	%	$	89,611	$	84,636		5.9	%

(1)	Same store defined as all stabilized properties owned as of January 1, 2010 and still owned and in the stabilized portfolio as of June 30, 2011.
(2)	Please refer to page 32 for a reconciliation of the Same Store measures on this page to Net (Loss) Income Available to Common Stockholders.

7

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Stabilized Portfolio Occupancy Overview

			Portfolio Breakdown								Occupancy at:(1)
	# of		Year-to-Date						Total Square
	Buildings		NOI(2)			Sq. Ft.			Feet		6/30/2011			3/31/2011			12/31/2010
STABILIZED PORTFOLIO:
OCCUPANCY BY PRODUCT TYPE:
Office:
Los Angeles and Ventura Counties		28		20.4	%		19.7	%		2,976,006		82.9	%		90.7	%		89.3	%
San Diego County		64		52.3	%		37.5	%		5,640,608		88.4	%		87.8	%		86.4	%
Orange County		5		4.2	%		3.6	%		540,656		92.5	%		93.9	%		93.1	%
San Francisco Bay Area		4		12.0	%		9.4	%		1,418,054		93.1	%		87.0	%		84.3	%
Greater Seattle		6		3.2	%		5.9	%		890,497		90.4	%		100.0	%		100.0	%
Subtotal		107		92.1	%		76.1	%		11,465,821		87.9	%		89.0	%		87.5	%
Industrial:
Los Angeles County		1		1.1	%		1.3	%		192,053		100.0	%		100.0	%		100.0	%
Orange County		39		6.8	%		22.6	%		3,413,354		97.4	%		95.6	%		93.5	%
Subtotal		40		7.9	%		23.9	%		3,605,407		97.6	%		95.9	%		93.9	%
OCCUPANCY BY REGION:
Los Angeles and Ventura Counties		29		21.5	%		21.0	%		3,168,059		84.0	%		91.3	%		89.9	%
San Diego County		64		52.3	%		37.5	%		5,640,608		88.4	%		87.8	%		86.4	%
Orange County		44		11.0	%		26.2	%		3,954,010		96.7	%		95.4	%		93.5	%
San Francisco Bay Area		4		12.0	%		9.4	%		1,418,054		93.1	%		87.0	%		84.3	%
Greater Seattle		6		3.2	%		5.9	%		890,497		90.4	%		100.0	%		100.0	%
TOTAL STABILIZED PORTFOLIO		147		100.0	%		100.0	%		15,071,228		90.2	%		90.8	%		89.1	%
REENTITLEMENT PROPERTY:
Industrial:
Orange County (17150 Von Karman)		1								157,458
TOTAL PORTFOLIO		148								15,228,686

	Average Occupancy — Stabilized Portfolio
	Office			Industrial			Total
Quarter-to-Date		88.1	%		97.0	%		90.2	%
Year-to-Date		88.4	%		95.7	%		90.2	%

	Average Occupancy — Same Store Portfolio
	Office			Industrial			Total
Quarter-to-Date		87.4	%		97.0	%		90.3	%
Year-to-Date		88.2	%		95.7	%		90.5	%

(1)	Occupancy percentages reported are based on the Company’s stabilized portfolio for the period presented.
(2)	Percentage of year-to-date Net Operating Income excluding Other Property Income and discontinued operations.

8

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Stabilized Portfolio Occupancy Overview

	City/
	Submarket	Square Feet		Occupancy
Office:
Los Angeles and Ventura, California
23925 Park Sorrento	Calabasas		11,789		100.0	%
23975 Park Sorrento	Calabasas		100,592		87.4	%
24025 Park Sorrento	Calabasas		102,264		96.8	%
26541 Agoura Road	Calabasas		90,156		100.0	%
5151 Camino Ruiz	Camarillo		187,861		—
5153 Camino Ruiz	Camarillo		38,655		51.7	%
5155 Camino Ruiz	Camarillo		38,856		51.4	%
2240 E. Imperial Highway	El Segundo		122,870		100.0	%
2250 E. Imperial Highway	El Segundo		293,261		96.6	%
909 N. Sepulveda Boulevard	El Segundo		241,607		92.6	%
999 N. Sepulveda Boulevard	El Segundo		128,504		80.2	%
3750 Kilroy Airport Way	Long Beach		10,457		86.1	%
3760 Kilroy Airport Way	Long Beach		165,278		96.1	%
3780 Kilroy Airport Way	Long Beach		219,745		84.8	%
3800 Kilroy Airport Way	Long Beach		192,476		93.6	%
3840 Kilroy Airport Way	Long Beach		136,026		100.0	%
3900 Kilroy Airport Way	Long Beach		126,840		91.0	%
12100 W. Olympic Boulevard	Los Angeles		150,167		65.1	%
12200 W. Olympic Boulevard	Los Angeles		150,302		92.2	%
12312 W. Olympic Boulevard	Los Angeles		78,000		100.0	%
1633 26th Street	Santa Monica		44,915		100.0	%
2100 Colorado Avenue	Santa Monica		102,864		54.3	%
3130 Wilshire Boulevard	Santa Monica		88,339		80.3	%
501 Santa Monica Boulevard	Santa Monica		73,115		88.0	%
2829 Townsgate Road	Thousand Oaks		81,067		85.9	%
Total Los Angeles and Ventura Counties Office			2,976,006		82.9	%

9

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Stabilized Portfolio Occupancy Overview

	City/
	Submarket	Square Feet		Occupancy
Office:
San Diego, California
12225 El Camino Real	Del Mar		60,148		97.8	%
12235 El Camino Real	Del Mar		54,673		81.0	%
12340 El Camino Real	Del Mar		87,405		86.9	%
12390 El Camino Real	Del Mar		72,332		100.0	%
12348 High Bluff Drive	Del Mar		38,710		100.0	%
12400 High Bluff Drive	Del Mar		208,464		100.0	%
3579 Valley Center Drive	Del Mar		52,375		79.0	%
3611 Valley Center Drive	Del Mar		130,178		100.0	%
3661 Valley Center Drive	Del Mar		129,752		99.4	%
3721 Valley Centre Drive	Del Mar		114,780		100.0	%
3811 Valley Centre Drive	Del Mar		112,067		100.0	%
6200 Greenwich Drive	Governor Park		71,000		100.0	%
6220 Greenwich Drive	Governor Park		141,214		100.0	%
15051 Avenue of Science	I-15 Corridor		70,617		100.0	%
15073 Avenue of Science	I-15 Corridor		46,759		100.0	%
15231 Avenue of Science	I-15 Corridor		65,638		100.0	%
15253 Avenue of Science	I-15 Corridor		37,437		100.0	%
15333 Avenue of Science	I-15 Corridor		78,880		46.4	%
15378 Avenue of Science	I-15 Corridor		68,910		100.0	%
15004 Innovation Drive	I-15 Corridor		150,801		100.0	%
15435 Innovation Drive	I-15 Corridor		51,500		63.5	%
15445 Innovation Drive	I-15 Corridor		51,500		100.0	%
13280 Evening Creek Drive South	I-15 Corridor		42,971		39.2	%
13290 Evening Creek Drive South	I-15 Corridor		61,176		—
13480 Evening Creek Drive North	I-15 Corridor		149,817		100.0	%
13500 Evening Creek Drive North	I-15 Corridor		147,533		100.0	%
13520 Evening Creek Drive North	I-15 Corridor		141,368		89.9	%
7525 Torrey Santa Fe	56 Corridor		103,979		100.0	%
7535 Torrey Santa Fe	56 Corridor		130,243		100.0	%
7545 Torrey Santa Fe	56 Corridor		130,354		100.0	%
7555 Torrey Santa Fe	56 Corridor		101,236		100.0	%

10

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Stabilized Portfolio Occupancy Overview

	City/
	Submarket	Square Feet		Occupancy
Office:
San Diego, California (Continued)
2355 Northside Drive	Mission Valley		50,425		67.6	%
2365 Northside Drive	Mission Valley		91,260		82.4	%
2375 Northside Drive	Mission Valley		48,949		82.4	%
2385 Northside Drive	Mission Valley		88,795		76.3	%
2305 Historic Decatur Road	Point Loma		103,900		95.4	%
10020 Pacific Mesa Boulevard	Sorrento Mesa		318,000		100.0	%
4910 Directors Place	Sorrento Mesa		50,925		44.2	%
4921 Directors Place	Sorrento Mesa		55,500		85.9	%
4939 Directors Place	Sorrento Mesa		60,662		100.0	%
4955 Directors Place	Sorrento Mesa		76,246		100.0	%
5005 Wateridge Vista Drive	Sorrento Mesa		61,460		—
5010 Wateridge Vista Drive	Sorrento Mesa		111,318		—
10770 Wateridge Circle	Sorrento Mesa		174,310		97.5	%
10243 Genetic Center Drive	Sorrento Mesa		102,875		—
6055 Lusk Avenue	Sorrento Mesa		93,000		100.0	%
6260 Sequence Drive	Sorrento Mesa		130,536		100.0	%
6290 Sequence Drive	Sorrento Mesa		90,000		100.0	%
6310 Sequence Drive	Sorrento Mesa		62,415		100.0	%
6340 Sequence Drive	Sorrento Mesa		66,400		100.0	%
6350 Sequence Drive	Sorrento Mesa		132,600		100.0	%
10390 Pacific Center Court	Sorrento Mesa		68,400		100.0	%
10394 Pacific Center Court	Sorrento Mesa		59,630		100.0	%
10398 Pacific Center Court	Sorrento Mesa		43,645		100.0	%
10421 Pacific Center Court	Sorrento Mesa		79,871		63.0	%
10445 Pacific Center Court	Sorrento Mesa		48,709		100.0	%
10455 Pacific Center Court	Sorrento Mesa		90,000		100.0	%
10350 Barnes Canyon	Sorrento Mesa		38,018		100.0	%
10120 Pacific Heights	Sorrento Mesa		52,540		100.0	%
5717 Pacific Center Boulevard	Sorrento Mesa		67,995		100.0	%
4690 Executive Drive	University Towne Center		47,212		100.0	%
9455 Towne Center Drive	University Towne Center		45,195		—
9785 Towne Center Drive	University Towne Center		75,534		100.0	%
9791 Towne Center Drive	University Towne Center		50,466		100.0	%
Total San Diego County Office			5,640,608		88.4	%

11

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Stabilized Portfolio Occupancy Overview

	City/
	Submarket	Square Feet		Occupancy
Office:
Orange County, California
4175 E. La Palma Avenue	Anaheim		43,263		79.8	%
8101 Kaiser Boulevard	Anaheim		59,790		96.5	%
2211 Michelson Drive	Irvine		271,556		92.3	%
111 Pacifica	Irvine Spectrum		67,496		87.4	%
999 Town & Country	Orange		98,551		100.0	%
Total Orange County Office			540,656		92.5	%
San Francisco Bay Area, California
303 Second Street	San Francisco		734,035		95.1	%
100 First Street	San Francisco		466,490		93.2	%
250 Brannan Street	San Francisco		90,742		76.7	%
4040 Civic Center	San Rafael		126,787		93.1	%
Total San Francisco Bay Area Office			1,418,054		93.1	%
Greater Seattle, Washington
601 108th Avenue NE	Bellevue		488,470		89.8	%
10220 NE Points Drive	Kirkland		49,851		89.5	%
10230 NE Points Drive	Kirkland		98,982		83.6	%
10210 NE Points Drive	Kirkland		84,641		83.5	%
3933 Lake Washington Blvd NE	Kirkland		46,450		100.0	%
15050 NE 36th Street	Redmond		122,103		100.0	%
Total Greater Seattle Office			890,497		90.4	%
Total Office			11,465,821		87.9	%
Industrial:
Los Angeles, California
2031 E. Mariposa Avenue	El Segundo		192,053		100.0	%
Total Los Angeles County Industrial			192,053		100.0	%

12

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Stabilized Portfolio Occupancy Overview

	City/
	Submarket	Square Feet		Occupancy
Industrial:
Orange County, California
1000 E. Ball Road	Anaheim		100,000		100.0	%
1230 S. Lewis Street	Anaheim		57,730		100.0	%
1250 N. Tustin Avenue	Anaheim		84,185		100.0	%
3125 E. Coronado Street	Anaheim		144,000		100.0	%
3130/3150 Miraloma Avenue	Anaheim		144,000		100.0	%
3250 E. Carpenter Avenue	Anaheim		41,225		100.0	%
3340 E. La Palma Avenue	Anaheim		153,320		100.0	%
3355 E. La Palma Avenue	Anaheim		98,200		100.0	%
4123 E. La Palma Avenue	Anaheim		70,863		100.0	%
4155 E. La Palma Avenue	Anaheim		74,618		99.9	%
5115 E. La Palma Avenue	Anaheim		286,139		100.0	%
5325 E. Hunter Avenue	Anaheim		110,487		100.0	%
1145 N. Ocean Boulevard	Anaheim		67,500		—
1201 N. Miller Street	Anaheim		119,612		100.0	%
1211 N. Miller Street	Anaheim		200,646		100.0	%
1231 N. Miller Street	Anaheim		113,700		100.0	%
950 W. Central Avenue	Brea		24,000		100.0	%
1050 W. Central Avenue	Brea		30,000		80.0	%
1150 W. Central Avenue	Brea		30,000		100.0	%
895 Beacon Street	Brea		54,795		100.0	%
955 Beacon Street	Brea		37,916		100.0	%
1125 Beacon Street	Brea		49,178		100.0	%
925 Lambert Road	Brea		80,000		100.0	%
1075 Lambert Road	Brea		98,811		100.0	%
1675 MacArthur Boulevard	Costa Mesa		50,842		100.0	%
25202 Towne Center Drive	Foothill Ranch		309,685		100.0	%
12681/12691 Pala Drive	Garden Grove		84,700		82.6	%

13

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Stabilized Portfolio Occupancy Overview

	City/
	Submarket	Square Feet		Occupancy
Industrial:
Orange County, California (Continued)
7421 Orangewood Avenue	Garden Grove		82,602		100.0	%
7091 Belgrave Avenue	Garden Grove		70,000		100.0	%
12271 Industry Street	Garden Grove		20,000		100.0	%
12311 Industry Street	Garden Grove		25,000		100.0	%
7261 Lampson Avenue	Garden Grove		47,092		100.0	%
12472 Edison Way	Garden Grove		55,576		100.0	%
12442 Knott Street	Garden Grove		58,303		100.0	%
2055 S.E. Main Street	Irvine		47,583		100.0	%
1951 E. Carnegie Avenue	Santa Ana		100,000		100.0	%
2525 Pullman Street	Santa Ana		103,380		100.0	%
14831 Franklin Avenue	Tustin		36,256		100.0	%
2911 Dow Avenue	Tustin		51,410		100.0	%
Total Orange County Industrial			3,413,354		97.4	%
Total Industrial			3,605,407		97.6	%

14

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report
Submarket Statistics as of June 30, 2011

	Market			Market			KRC			KRC
	Direct			Total			Percentage			Percentage
Submarket	Vacancy(1)			Vacancy(1)			Occupied			Leased
SAN DIEGO
Del Mar		12.2	%		16.0	%		97.7	%		98.2	%
Sorrento Mesa
Two— Three Story Corporate		11.9	%		12.3	%		83.8	%		89.8	%
University Towne Center / Governor Park
Two— Three Story Corporate		14.4	%		22.0	%		89.5	%		89.5	%
I-15 Corridor
Class A Office Market		14.8	%		15.3	%		96.8	%		96.8	%
Two— Three Story Corporate		19.6	%		21.0	%		79.6	%		79.6	%
Mission Valley		19.0	%		19.6	%		77.8	%		81.0	%
Point Loma		12.3	%		12.3	%		95.4	%		95.4	%
ORANGE COUNTY
Office		16.4	%		20.6	%		92.5	%		92.5	%
Industrial		5.1	%		9.2	%		97.4	%		99.6	%
LOS ANGELES
Westside		15.0	%		18.6	%		80.0	%		88.7	%
El Segundo (Class A)		21.8	%		23.0	%		93.2	%		95.9	%
Long Beach Airport (Class A)		14.2	%		14.5	%		92.4	%		92.7	%
101 Corridor (Class A)		18.2	%		18.9	%		61.2	%		61.8	%
SAN FRANCISCO
South Financial District		11.0	%		11.4	%		93.1	%		96.5	%
GREATER SEATTLE
Eastside		15.2	%		16.0	%		90.4	%		91.1	%

(1) Market direct and market total vacancy data was obtained from market research data from third parties. Kilroy Realty Corporation uses market research data from third parties to analyze the current and projected real estate fundamentals in each of its existing submarkets as well as potential acquisition submarkets. Recent market research data from third parties suggests improvement in real estate fundamentals in each of Kilroy Realty’s primary submarkets over the next few years. Please note that Kilroy Realty Corporation does not verify the market research data from third parties and further that such data does not represent views or forecasts of Kilroy Realty Corporation or its management.

15

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Lease Commencement Information

For Leases That Commenced During the Three Months Ended June 30, 2011

	1st & 2nd Generation								2nd Generation
											Maintenance					Changes in						Weighted
	# of Leases(1)				Square Feet(1)				TI/LC		Capex Per		Changes in			Cash			Retention			Average Lease
	New		Renewal		New		Renewal		Per Sq.Ft.(2)		Sq. Ft.(3)		Rents(4)			Rents(5)			Rates(6)			Term (Mo.)
Office		22		7		199,540		45,373	$	30.99	$	0.13		1.1	%		(6.6	)%		11.6	%		47
Industrial		3		1		60,481		54,795		9.66		0.18		(23.8	)%		(31.7	)%		100.0	%		81
Total		25		8		260,021		100,168	$	21.21	$	0.15		(4.2	)%		(11.8	)%		22.4	%		64

For Leases That Commenced During the Six Months Ended June 30, 2011

	1st & 2nd Generation								2nd Generation
											Maintenance					Changes in						Weighted
	# of Leases(1)				Square Feet(1)				TI/LC		Capex Per		Changes in			Cash			Retention			Average Lease
	New		Renewal		New		Renewal		Per Sq.Ft.(2)		Sq. Ft.(3)		Rents(4)			Rents(5)			Rates(6)			Term (Mo.)
Office		37		17		367,449		119,329	$	33.50	$	0.26		(12.0	)%		(17.1	)%		23.6	%		55
Industrial		5		2		145,270		91,766		6.44		0.25		(17.4	)%		(23.6	)%		93.9	%		84
Total		42		19		512,719		211,095	$	21.73	$	0.26		(12.7	)%		(17.9	)%		35.0	%		68

(1)	Represents leasing activity for leases that commenced during the period shown, including first and second generation space, net of month-to-month leases.
(2)	Amounts exclude tenant-funded tenant improvements.
(3)	Calculated over entire stabilized portfolio.
(4)	Calculated as the change between GAAP rents for new/renewed leases and the expiring GAAP rents for the same space. Excludes leases for which the space was vacant longer than one year, or vacant when the property was acquired by the Company.
(5)	Calculated as the change between stated rents for new/renewed leases and the expiring stated rents for the same space. Excludes leases for which the space was vacant longer than one year, or vacant when the property was acquired by the Company.
(6)	Calculated as the percentage of space either renewed or expanded into by existing tenants or subtenants at lease expiration.

16

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Stabilized Portfolio Capital Expenditures
($ in thousands)

1st Generation (Nonrecurring) Capital Expenditures⁽¹⁾:

	Q1 2011		Q2 2011		YTD 2011
Capital Improvements	$	1,347	$	3,812	$	5,159
Tenant Improvements & Leasing Commissions		3,488		2,210		5,698
Total	$	4,835	$	6,022	$	10,857

2nd Generation (Recurring) Capital Expenditures:

	Q1 2011		Q2 2011		YTD 2011
Capital Improvements
Office	$	1,335	$	1,372	$	2,707
Industrial		236		660		896
		1,571		2,032		3,603
Tenant Improvements & Leasing Commissions (2)
Office		5,590		7,167		12,757
Industrial		810		1,963		2,773
		6,400		9,130		15,530
Total
Office		6,925		8,539		15,464
Industrial		1,046		2,623		3,669
	$	7,971	$	11,162	$	19,133

(1)	We generally categorize capital expenditures for newly acquired space, newly developed space, or change in use as 1st Generation. These costs are not subtracted in our calculation of Funds Available for Distribution.
(2)	Represents costs incurred for leasing activity during the period shown. Amounts exclude tenant-funded tenant improvements.

17

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Lease Expiration Summary Schedule ⁽¹⁾
($ in thousands)

	# of Expiring		Total Square		% of Total			Annualized		% of Total Annualized			Annualized Rent
Year of Expiration	Leases		Feet		Leased Sq. Ft.			Base Rent(2)		Base Rent(2)			per Sq. Ft.(2)
OFFICE:
Remainder of 2011		21		131,454		1.0	%	$	3,355		1.0	%	$	25.52
2012		83		847,738		6.3	%		23,085		7.0	%		27.23
2013		84		1,085,761		8.1	%		30,575		9.3	%		28.16
2014		78		1,331,446		9.9	%		35,427		10.8	%		26.61
2015		112		1,901,249		14.2	%		58,942		17.9	%		31.00
2016		48		584,546		4.4	%		14,500		4.4	%		24.81
2017		38		1,478,328		11.0	%		42,966		13.0	%		29.06
2018		19		837,303		6.2	%		35,484		10.8	%		42.38
2019		13		441,970		3.3	%		16,262		4.9	%		36.79
2020		14		577,034		4.2	%		16,782		5.1	%		29.08
2021 and beyond		13		700,214		5.1	%		26,140		7.9	%		37.33
Subtotal		523		9,917,043		73.7	%	$	303,518		92.1	%	$	30.61
INDUSTRIAL:
Remainder of 2011		1		78,605		0.6	%	$	733		0.2	%	$	9.33
2012		11		452,557		3.4	%		2,647		0.8	%		5.85
2013		9		628,386		4.7	%		4,671		1.4	%		7.43
2014		17		568,386		4.2	%		4,528		1.4	%		7.97
2015		10		544,864		4.1	%		3,839		1.2	%		7.05
2016		5		317,198		2.4	%		3,695		1.1	%		11.65
2017		4		149,482		1.1	%		888		0.3	%		5.94
2018		3		186,878		1.4	%		1,189		0.4	%		6.36
2019		2		168,200		1.3	%		1,467		0.4	%		8.72
2020		1		50,842		0.4	%		577		0.2	%		11.35
2021 and beyond		3		371,633		2.7	%		1,681		0.5	%		4.52
Subtotal		66		3,517,031		26.3	%	$	25,915		7.9	%	$	7.37
TOTAL PORTFOLIO:
Remainder of 2011		22		210,059		1.6	%	$	4,088		1.2	%	$	19.46
2012		94		1,300,295		9.7	%		25,732		7.8	%		19.79
2013		93		1,714,147		12.8	%		35,246		10.7	%		20.56
2014		95		1,899,832		14.1	%		39,955		12.1	%		21.03
2015		122		2,446,113		18.2	%		62,781		19.1	%		25.67
2016		53		901,744		6.7	%		18,195		5.5	%		20.18
2017		42		1,627,810		12.1	%		43,854		13.3	%		26.94
2018		22		1,024,181		7.6	%		36,673		11.1	%		35.81
2019		15		610,170		4.5	%		17,729		5.4	%		29.06
2020		15		627,876		4.7	%		17,359		5.3	%		27.65
2021 and beyond		16		1,071,847		8.0	%		27,821		8.5	%		25.96
Total		589		13,434,074		100.0	%	$	329,433		100.0	%	$	24.52

(1)

The information presented for all lease expiration activity reflects leasing activity through June 30, 2011. For leases that have been renewed early or space that has been re-leased to a new tenant, the expiration date and annualized base rent information presented takes into consideration the renewed or re-leased lease terms. Excludes space leased under month-to-month leases and vacant space as of June 30, 2011.

(2)

Reflects annualized contractual base rent calculated on a straight-line basis in accordance with GAAP excluding the amortization of deferred revenue related to tenant-funded tenant improvements and expense reimbursement revenue. Additionally, the underlying leases contain various expense structures including full service gross, modified gross and triple net. Amounts represent percentage of total portfolio annualized contractual base rental revenue.

18

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Lease Expiration Schedule Detail by Region ⁽¹⁾
($ in thousands)

	Los Angeles/Ventura Counties														Orange County
										% of Total			Annualized											% of Total			Annualized
Year of	# of Expiring		Total		% of Total			Annualized		Annualized			Rent		# of Expiring		Total		% of Total			Annualized		Annualized			Rent
Expiration	Leases		Square Feet		Leased Sq. Ft.			Base Rent(2)		Base Rent(2)			per Sq. Ft.(2)		Leases		Square Feet		Leased Sq. Ft.			Base Rent(2)		Base Rent(2)			per Sq. Ft.(2)
OFFICE:
Remainder of 2011		17		114,674		0.9	%	$	3,038		0.9	%	$	26.49		1		4,453		0.0	%	$	30		0.0	%	$	6.74
2012		40		175,149		1.3	%		5,134		1.6	%		29.31		16		60,478		0.5	%		1,469		0.4	%		24.29
2013		37		380,931		2.8	%		10,046		3.0	%		26.37		13		51,220		0.4	%		1,426		0.4	%		27.84
2014		41		611,477		4.6	%		16,959		5.1	%		27.73		13		55,303		0.4	%		1,682		0.5	%		30.41
2015		31		333,589		2.5	%		10,357		3.1	%		31.05		7		56,652		0.4	%		1,427		0.4	%		25.19
2016		23		148,304		1.1	%		4,583		1.4	%		30.90		5		21,834		0.2	%		630		0.2	%		28.85
2017		14		204,719		1.5	%		6,938		2.1	%		33.89		3		55,101		0.4	%		2,339		0.7	%		42.45
2018		3		35,140		0.3	%		1,196		0.4	%		34.04		2		106,935		0.7	%		3,307		1.1	%		30.93
2019		2		170,596		1.3	%		6,348		1.9	%		37.21		1		61,885		0.5	%		2,775		0.9	%		44.84
2020		2		40,357		0.3	%		952		0.3	%		23.59		1		13,397		0.1	%		438		0.1	%		32.69
2021 and beyond		3		146,053		1.1	%		4,041		1.2	%		27.67		—		—		—			—		—			—
Subtotal		213		2,360,989		17.7	%	$	69,592		21.0	%	$	29.48		62		487,258		3.6	%	$	15,523		4.7	%	$	31.86
INDUSTRIAL:
Remainder of 2011		—		—		—			—		—			—		1		78,605		0.6	%	$	733		0.2	%	$	9.33
2012		—		—		—			—		—			—		11		452,557		3.4	%		2,647		0.8	%		5.85
2013		—		—		—			—		—			—		9		628,386		4.7	%		4,671		1.4	%		7.43
2014		—		—		—			—		—			—		17		568,386		4.2	%		4,528		1.4	%		7.97
2015		—		—		—			—		—			—		10		544,864		4.1	%		3,839		1.2	%		7.05
2016		1		192,053		1.4	%		2,960		0.9	%		15.41		4		125,145		0.9	%		735		0.2	%		5.87
2017		—		—		—			—		—			—		4		149,482		1.1	%		888		0.3	%		5.94
2018		—		—		—			—		—			—		3		186,878		1.4	%		1,189		0.4	%		6.36
2019		—		—		—			—		—			—		2		168,200		1.3	%		1,467		0.4	%		8.72
2020		—		—		—			—		—			—		1		50,842		0.4	%		577		0.2	%		11.35
2021 and beyond		—		—		—			—		—			—		3		371,633		2.7	%		1,681		0.5	%		4.52
Subtotal		1		192,053		1.4	%	$	2,960		0.9	%	$	15.41		65		3,324,978		24.8	%	$	22,955		7.0	%	$	6.90
TOTAL PORTFOLIO:
Remainder of 2011		17		114,674		0.9	%	$	3,038		0.9	%	$	26.49		2		83,058		0.6	%	$	763		0.2	%	$	9.19
2012		40		175,149		1.3	%		5,134		1.6	%		29.31		27		513,035		3.8	%		4,116		1.2	%		8.02
2013		37		380,931		2.8	%		10,046		3.0	%		26.37		22		679,606		5.1	%		6,097		1.9	%		8.97
2014		41		611,477		4.6	%		16,959		5.1	%		27.73		30		623,689		4.6	%		6,210		1.9	%		9.96
2015		31		333,589		2.5	%		10,357		3.1	%		31.05		17		601,516		4.5	%		5,266		1.6	%		8.75
2016		24		340,357		2.5	%		7,543		2.3	%		22.16		9		146,979		1.1	%		1,365		0.4	%		9.29
2017		14		204,719		1.5	%		6,938		2.1	%		33.89		7		204,583		1.5	%		3,227		1.0	%		15.77
2018		3		35,140		0.3	%		1,196		0.4	%		34.04		5		293,813		2.2	%		4,496		1.4	%		15.30
2019		2		170,596		1.3	%		6,348		1.9	%		37.21		3		230,085		1.7	%		4,242		1.3	%		18.44
2020		2		40,357		0.3	%		952		0.3	%		23.59		2		64,239		0.5	%		1,015		0.3	%		15.80
2021 and beyond		3		146,053		1.1	%		4,041		1.2	%		27.67		3		371,633		2.8	%		1,681		0.5	%		4.52
Total		214		2,553,042		19.1	%	$	72,552		21.9	%	$	28.42		127		3,812,236		28.4	%	$	38,478		11.7	%	$	10.09

(1)

The information presented for all lease expiration activity reflects leasing activity through June 30, 2011. For leases that have been renewed early or space that has been re-leased to a new tenant, the expiration date and annualized base rent information presented takes into consideration the renewed or re-leased lease terms. Excludes space leased under month-to-month leases and vacant space as of June 30, 2011.

(2)

Reflects annualized contractual base rent calculated on a straight-line basis in accordance with GAAP excluding the amortization of deferred revenue related to tenant-funded tenant improvements and expense reimbursement revenue. Additionally, the underlying leases contain various expense structures including full service gross, modified gross and triple net. Amounts represent percentage of total portfolio annualized contractual base rental revenue.

19

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report
Lease Expiration Schedule Detail by Region ⁽¹⁾
($ in thousands)

San Diego
										% of Total			Annualized
Year of	# of Expiring		Total		% of Total			Annualized		Annualized			Rent
Expiration	Leases		Square Feet		Leased Sq. Ft.			Base Rent(2)		Base Rent(2)			per Sq. Ft.(2)
OFFICE TOTAL:
Remainder of 2011		2		9,211		0.1	%	$	264		0.1	%	$	28.66
2012		15		475,692		3.5	%		12,604		3.8	%		26.50
2013		10		296,357		2.2	%		6,978		2.1	%		23.55
2014		14		518,044		3.9	%		11,789		3.6	%		22.76
2015		20		636,238		4.7	%		15,698		4.8	%		24.67
2016		13		315,032		2.3	%		6,079		1.8	%		19.30
2017		17		1,183,180		8.8	%		32,763		9.9	%		27.69
2018		11		635,304		4.7	%		29,166		8.9	%		45.91
2019		4		121,586		0.9	%		3,843		1.2	%		31.61
2020		7		350,174		2.6	%		10,678		3.2	%		30.49
2021 and beyond		6		423,095		3.1	%		17,590		5.3	%		41.57
Total		119		4,963,913		36.8	%	$	147,452		44.7	%	$	29.70

San Francisco Bay Area
										% of Total			Annualized
Year of	# of Expiring		Total		% of Total			Annualized		Annualized			Rent
Expiration	Leases		Square Feet		Leased Sq. Ft.			Base Rent(2)		Base Rent(2)			per Sq. Ft.(2)
OFFICE TOTAL:
Remainder of 2011		—		—		—			—		—			—
2012		8		83,794		0.6	%		2,706		0.8	%		32.29
2013		16		215,611		1.6	%		8,178		2.5	%		37.93
2014		5		106,082		0.8	%		3,880		1.2	%		36.58
2015		31		503,777		3.7	%		21,589		6.6	%		42.85
2016		3		31,619		0.2	%		1,457		0.4	%		46.08
2017		2		15,644		0.1	%		635		0.2	%		40.59
2018		1		11,046		0.1	%		444		0.1	%		40.20
2019		3		47,595		0.4	%		1,983		0.6	%		41.66
2020		4		173,106		1.3	%		4,714		1.4	%		27.23
2021 and beyond		2		120,297		0.9	%		4,236		1.3	%		35.21
Total		75		1,308,571		9.7	%	$	49,822		15.1	%	$	38.07

Greater Seattle
										% of Total			Annualized
Year of	# of Expiring		Total		% of Total			Annualized		Annualized			Rent
Expiration	Leases		Square Feet		Leased Sq. Ft.			Base Rent(2)		Base Rent(2)			per Sq. Ft.(2)
OFFICE TOTAL:
Remainder of 2011		1		3,116		0.0	%	$	23		0.0	%	$	7.38
2012		4		52,625		0.4	%		1,172		0.4	%		22.27
2013		8		141,642		1.1	%		3,947		1.2	%		27.87
2014		5		40,540		0.3	%		1,117		0.3	%		27.55
2015		23		370,993		2.8	%		9,871		3.0	%		26.61
2016		4		67,757		0.5	%		1,751		0.5	%		25.84
2017		2		19,684		0.1	%		291		0.1	%		14.78
2018		2		48,878		0.4	%		1,371		0.4	%		28.05
2019		3		40,308		0.3	%		1,313		0.4	%		32.57
2020		—		—		—			—		—			—
2021 and beyond		2		10,769		0.1	%		273		0.1	%		25.35
Total		54		796,312		6.0	%	$	21,129		6.4	%	$	26.53

(1)

The information presented for all lease expiration activity reflects leasing activity through June 30, 2011. For leases that have been renewed early or space that has been re-leased to a new tenant, the expiration date and annualized base rent information presented takes into consideration the renewed or re-leased lease terms. Excludes space leased under month-to-month leases and vacant space as of June 30, 2011.

(2)

Reflects annualized contractual base rent calculated on a straight-line basis in accordance with GAAP excluding the amortization of deferred revenue related to tenant-funded tenant improvements and expense reimbursement revenue. Additionally, the underlying leases contain various expense structures including full service gross, modified gross and triple net. Amounts represent percentage of total portfolio annualized contractual base rental revenue.

20

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Quarterly Lease Expirations for 2011⁽¹⁾
($ in thousands)

										% of Total
	# of Expiring		Total Square		% of Total			Annualized		Annualized			Annualized Rent
	Leases		Feet		Leased Sq. Ft.			Base Rent(2)		Base Rent(2)			per Sq. Ft.(2)
OFFICE:
Q3 2011		11		59,774		0.4	%	$	1,656		0.5	%	$	27.70
Q4 2011		10		71,680		0.6	%		1,699		0.5	%		23.70
Subtotal 2011		21		131,454		1.0	%	$	3,355		1.0	%	$	25.52
INDUSTRIAL:
Q3 2011		—		—		—			—		—			—
Q4 2011		1		78,605		0.6	%		733		0.2	%		9.33
Subtotal 2011		1		78,605		0.6	%	$	733		0.2	%	$	9.33
TOTAL PORTFOLIO:
Q3 2011		11		59,774		0.4	%	$	1,656		0.5	%	$	27.70
Q4 2011		11		150,285		1.2	%		2,432		0.7	%		16.18
Total 2011		22		210,059		1.6	%	$	4,088		1.2	%	$	19.46

(1)

The information presented reflects leasing activity through June 30, 2011. For leases that have been renewed early or space that has been re-leased to a new tenant, the expiration date and annualized base rent information presented takes into consideration the renewed or re-leased lease terms. Excludes space leased under month-to-month leases and vacant space as of June 30, 2011.

(2)

Reflects annualized contractual base rent calculated on a straight-line basis in accordance with GAAP excluding the amortization of deferred revenue related to tenant-funded tenant improvements and expense reimbursement revenue. Additionally, the underlying leases contain various expense structures including full service gross, modified gross and triple net. Amounts represent percentage of total portfolio annualized contractual base rental revenue.

21

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Top Fifteen Tenants ⁽¹⁾
($ in thousands)

						Percentage of
		Annualized				Total Annualized			Percentage of
	Product	Base Rental		Rentable		Base Rental			Total Rentable
Tenant Name	Type	Revenue(2)		Square Feet		Revenue(2)			Square Feet
Intuit, Inc.	Office	$	15,126		536,812		4.7	%		3.6	%
Bridgepoint Education, Inc.	Office		15,099		317,678		4.7	%		2.1	%
Scripps Health	Office		12,562		262,868		3.9	%		1.7	%
Delta Dental of California	Office		10,832		249,115		3.3	%		1.7	%
CareFusion Corporation (3)	Office		10,087		459,709		3.1	%		3.1	%
DIRECTV, Inc.	Office		8,899		327,624		2.7	%		2.2	%
AMN Healthcare, Inc.	Office		8,192		175,672		2.5	%		1.2	%
Fish & Richardson P.C.	Office		6,071		139,538		1.9	%		0.9	%
Hewlett-Packard Company	Office		5,803		162,017		1.8	%		1.1	%
Wells Fargo (3)	Office		5,328		137,149		1.6	%		0.9	%
BP Biofuels North America LLC	Office		5,128		136,908		1.6	%		0.9	%
Epson America, Inc.	Office		4,915		136,026		1.5	%		0.9	%
Avnet, Inc.	Office		4,163		132,929		1.3	%		0.9	%
Mitchell International, Inc.	Office		3,775		141,214		1.2	%		0.9	%
Scan Health Plan (3)	Office		3,626		124,598		1.1	%		0.8	%
Total Top Fifteen Tenants		$	119,606		3,439,857		36.9	%		22.9	%

(1)	The information presented is as of the date of this filing.
(2)	Based upon annualized contractual base rental revenue, which is calculated on a straight-line basis in accordance with GAAP, for leases for which rental revenue is being recognized by the Company as of June 30, 2011.
(3)	The Company has entered into leases with various affiliates of the tenant name listed above.

22

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

2011 Acquisitions
($ in millions)

COMPLETED ACQUISITIONS ⁽¹⁾

						Rentable
			Month of	No. of		Square		Purchase
Property	Submarket	Type	Acquisition	Buildings		Feet		Price
1st Quarter:
250 Brannan Street	South Financial District	Office	January		1		90,742	$	33.0
San Francisco, CA
2nd Quarter:
10210, 10220, and 10230 NE Points Drive; 3933 Lake Washington Boulevard NE	Eastside	Office	April		4		279,924		100.1
Kirkland, WA
10770 Wateridge Circle	Sorrento Mesa	Office	May		1		174,310		32.7
San Diego, CA
601 108th Avenue N.E.	Bellevue	Office	June		1		488,470		215.0
Bellevue, WA
4040 Civic Center Drive	San Rafael	Office	June		1		126,787		32.2
San Rafael, CA
TOTAL					8		1,160,233	$	413.0

(1) These properties were added to the Company’s stabilized portfolio upon acquisition.

23

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

In-Process and Committed Redevelopment Projects
($ in millions)

		Estimated
		Construction Period
								Estimated
						Estimated		Rentable				Estimated		Total		Total Costs
		Start		Compl.		Stabilization		Square		Existing		Redevelopment		Estimated		as of
Redevelopment Project	Location	Date		Date		Date(1)		Feet		Investment(2)		Costs		Investment		6/30/2011(3)		% Leased
UNDER CONSTRUCTION:
2260 E. Imperial Highway	El Segundo		3Q 2010		3Q 2011		3Q 2012		300,000	$	9.1	$	43.3	$	52.4	$	20.4		0	%
COMMITTED PROJECT:
3880 Kilroy Airport Way (4)	Long Beach		3Q 2011		2Q 2012		2Q 2013		98,000		6.3		13.1		19.4		7.1		50	%
									398,000	$	15.4	$	56.4	$	71.8	$	27.5		12	%

(1)	Based on management’s estimation of the earlier of stabilized occupancy (95%) or one year from the date of substantial completion.
(2)	Represents the depreciated carrying value at the commencement of redevelopment for the space being redeveloped.
(3)	Represents cash paid and costs incurred as of June 30, 2011. Includes existing investment at the commencement of redevelopment.
(4)	Subsequent to June 30, 2011 the Company committed to redeveloping this building. The redevelopment will occur in two phases and the existing tenant will occupy approximately 50% during both redevelopment phases. Capitalized carry costs will be prorated based on occupancy during redevelopment.

24

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Future Development Pipeline
($ in millions)

			Gross		Estimated		Total Costs
			Site		Rentable		as of
Project	Location	Type	Acreage		Square Feet		6/30/2011(1)
SAN DIEGO, CALIFORNIA
Carlsbad Oaks — Lots 4, 5, 7 & 8	Carlsbad	Office		32.0		288,000	$	18.2
Pacific Corporate Center — Lot 8	Sorrento Mesa	Office		5.0		170,000		11.3
Rancho Bernardo Corporate Center	I-15 Corridor	Office		21.0		320,000 - 1,000,000		27.2
One Paseo (2)	Del Mar	Office		23.0		500,000		117.2
Santa Fe Summit — Phase II and III	56 Corridor	Office		21.8		600,000		77.3
Sorrento Gateway — Lot 2	Sorrento Mesa	Office		6.3		80,000		11.1
Sorrento Gateway — Lot 7	Sorrento Mesa	Office		7.6		57,000		10.0
SUBTOTAL				116.7		2,015,000 - 2,695,000	$	272.3
GREATER SEATTLE, WASHINGTON
Plaza at Yarrow Bay — Building 5	Kirkland	Office		1.1		74,000	$	2.6
TOTAL FUTURE DEVELOPMENT PIPELINE				117.8		2,089,000 - 2,769,000	$	274.9

(1)	Represents cash paid and costs incurred as of June 30, 2011.
(2)	Estimated rentable square feet reflects existing office entitlements. The Company is currently pursuing mixed-use entitlements for this project which, if successfully obtained, would increase the estimated rentable square feet.

25

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Capital Structure
As of June 30, 2011
($ in thousands)

			Aggregate
			Principal
			Amount or		% of Total
	Shares/Units As of		$ Value		Market
	June 30, 2011		Equivalent		Capitalization
DEBT:
Unsecured Line of Credit (1)			$	245,000		5.7	%
Unsecured Exchangeable Senior Notes due 2012 (2)				148,000		3.5	%
Unsecured Exchangeable Senior Notes due 2014 (2)				172,500		4.0	%
Unsecured Senior Notes due 2014				83,000		1.9	%
Unsecured Senior Notes due 2015 (2)				325,000		7.6	%
Unsecured Senior Notes due 2020 (2)				250,000		5.8	%
Secured Debt (2)				475,291		11.1	%
Total Debt (6)			$	1,698,791		39.6	%
EQUITY AND NONCONTROLLING INTERESTS:
7.450% Series A Cumulative Redeemable Preferred units (3)		1,500,000	$	75,000		1.8	%
7.800% Series E Cumulative Redeemable Preferred stock (4)		1,610,000		40,250		0.9	%
7.500% Series F Cumulative Redeemable Preferred stock (4)		3,450,000		86,250		2.0	%
Common units outstanding (5)		1,718,131		67,849		1.6	%
Common shares outstanding (5)		58,464,412		2,308,760		54.1	%
Total Equity and Noncontrolling Interests			$	2,578,109		60.4	%
TOTAL MARKET CAPITALIZATION			$	4,276,900		100.0	%

(1)	In June 2011, the Company amended the terms of its Credit Facility to extend the maturity date from August 2013 to August 2015, reduce the interest rate from an annual rate of LIBOR plus 2.675% to annual rate of LIBOR plus 1.750% , and reduce the facility fee from an annual rate of 0.575% to an annual rate of 0.350%.
(2)	Represents gross aggregate principal amount due at maturity before the effect of the unamortized discounts and premiums as of June 30, 2011.
(3)	Value based on $50.00 per unit liquidation preference.
(4)	Value based on $25.00 per share liquidation preference.
(5)	Value based on closing share price of $39.49 as of June 30, 2011.
(6)	In July 2011, the Company issued unsecured senior notes with an aggregate principal balance of $325.0 million that are scheduled to mature in July 2018. The unsecured senior notes require semi-annual interest payments each January and July based on a stated annual interest rate of 4.80%. The Company used the net proceeds from this offering for general corporate purposes, including the repayment of borrowings under the Credit Facility.

26

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Debt Analysis
As of June 30, 2011
($ in millions)

TOTAL DEBT COMPOSITION

	% of			Weighted Average
	Total Debt			Interest Rate			Maturity
Secured vs. Unsecured Debt:
Unsecured Debt (1)		72.0	%		4.7	%		4.6
Secured Debt		28.0	%		5.4	%		3.6
Floating vs. Fixed-Rate Debt:
Floating-Rate Debt		14.4	%		2.9	%		4.1
Fixed-Rate Debt (1)		85.6	%		5.2	%		4.3
Total (1)					4.9	%		4.3
Total Including Debt Issuance Costs (1)					5.4	%
Total GAAP Effective Rate (2)					5.9	%

CAPITALIZED INTEREST, LOAN FEES, AND DEBT DISCOUNTS
Quarter-to-Date	Year-to-Date
$2.1	$4.0

(1)	Excludes the impact of the amortization of the noncash debt discounts related to the accounting required for the Company’s Exchangeable Notes.
(2)	Includes the impact of the amortization of the noncash debt discounts related to the accounting required for the Company’s Exchangeable Notes.

27

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Debt Analysis
As of June 30, 2011
($ in thousands)

DEBT MATURITY SCHEDULE
Floating/				Maturity		Remaining
Fixed Rate	Stated Rate			Date		2011		2012		2013		2014		2015		After 2015		Total(1)
Unsecured Debt:
Floating		2.87	%		8/10/2015									$	245,000			$	245,000	(2)
Fixed		3.25	%		4/15/2012				148,000										148,000
Fixed		4.25	%		11/15/2014								172,500						172,500
Fixed		6.45	%		8/4/2014								83,000						83,000
Fixed		5.00	%		11/3/2015										325,000				325,000
Fixed		6.63	%		6/1/2020												250,000		250,000
							—		148,000		—		255,500		570,000		250,000		1,223,500
Secured Debt:
Fixed		6.70	%		12/27/2011		69,216												69,216
Fixed		5.10	%		4/1/2012				52,000										52,000
Fixed		5.57	%		8/1/2012		776		71,517										72,293
Fixed		4.95	%		8/1/2012		348		29,754										30,102
Fixed		4.94	%		4/15/2015		488		1,011		1,062		1,116		26,205				29,882
Fixed		6.51	%		2/1/2017		425		892		952		1,016		1,084		65,563		69,932
Fixed		7.15	%		5/1/2017		987		2,084		2,238		2,404		2,581		3,988		14,282
Fixed		4.27	%		2/1/2018						2,075		2,358		2,461		128,106		135,000
Fixed	Various			Various			22		45		46		49		51		2,371		2,584	(3)
							72,262		157,303		6,373		6,943		32,382		200,028		475,291
Total		4.89	%			$	72,262	$	305,303	$	6,373	$	262,443	$	602,382	$	450,028	$	1,698,791

(1)	Amounts presented reflect the gross principal balances before the effect of any unamortized discounts/premiums. As of June 30, 2011, the aggregate net unamortized discounts totaled approximately $18.7 million.
(2)	In June 2011, we amended the terms of our Credit Facility to extend the maturity date from August 2013 to August 2015, reduce the interest rate from an annual rate of LIBOR plus 2.675% to annual rate of LIBOR plus 1.750% , and reduce the facility fee from an annual rate of 0.575% to an annual rate of 0.350%.
(3)	Represents balance outstanding related to public facility bonds (the “Bonds”) issued in February 2008 by the City of Carlsbad. The Bonds have annual maturities beginning on September 1, 2011 through September 1, 2038, with interest rates ranging from 4.40% to 6.20%.

28

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Debt Covenants
As of June 30, 2011
($ in millions)

KEY DEBT COVENANTS

		Actual Performance
	Covenant	as of June 30, 2011
Credit Facility (as defined per Credit Agreement):
Total debt to total asset value	less than 60%		39	%
Fixed charge coverage ratio	greater than 1.5x		2.5	x
Unsecured debt ratio	greater than 1.67x		2.35	x
Unencumbered asset pool debt service coverage	greater than 2.0x		3.8	x
Unsecured Senior Notes due 2015 and 2020 (as defined per Indentures):
Total debt to total asset value	less than 60%		44	%
Interest coverage	greater than 1.5x		3.0	x
Secured debt to total asset value	less than 40%		12	%
Unencumbered asset pool value to unsecured debt	greater than 150%		240	%

29

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Management Statements on Non-GAAP Supplemental Measures

     Included in this section are management’s statements regarding certain non-GAAP financial measures provided in this supplemental financial report and, with respect to Funds From Operations (“FFO”), in the Company’s earnings release on July 26, 2011 and the reasons why management believes that these measures provide useful information to investors about the Company’s financial condition and results of operations.

Net Operating Income:

     Management believes that Net Operating Income (“NOI”) is a useful supplemental measure of the Company’s operating performance. The Company defines NOI as operating revenues (rental income, tenant reimbursements and other property income) less property and related expenses (property expenses, real estate taxes, provision for bad debts and ground leases). Other real estate investment trusts (“REITs”) may use different methodologies for calculating NOI, and accordingly, the Company’s NOI may not be comparable to other REITs.

     Because NOI excludes general and administrative expenses, interest expense, depreciation and amortization, acquisition-related expenses, other nonproperty income and losses, and gains and losses from property dispositions, it provides a performance measure that, when compared year over year, reflects the revenues and expenses directly associated with owning and operating commercial real estate and the impact to operations from trends in occupancy rates, rental rates, and operating costs, providing a perspective on operations not immediately apparent from net income. The Company uses NOI to evaluate its operating performance on a segment basis since NOI allows the Company to evaluate the impact that factors such as occupancy levels, lease structure, rental rates, and tenant base, which vary by segment type, have on the Company’s results, margins and returns. In addition, management believes that NOI provides useful information to the investment community about the Company’s financial and operating performance when compared to other REITs since NOI is generally recognized as a standard measure of performance in the real estate industry.

     However, NOI should not be viewed as an alternative measure of the Company’s financial performance since it does not reflect general and administrative expenses, acquisition-related expenses, interest expense, depreciation and amortization costs, other nonproperty income and losses, the level of capital expenditures and leasing costs necessary to maintain the operating performance of the Company’s properties, or trends in development and construction activities which are significant economic costs and activities that could materially impact the Company’s results from operations.

Same Store Net Operating Income:

     Management believes that Same Store NOI is a useful supplemental measure of the Company’s operating performance. Same Store NOI represents the NOI for the stabilized properties that were operational for two comparable reporting periods. Because Same Store NOI excludes the change in NOI from properties developed, redeveloped, acquired and disposed of, it highlights operating trends such as occupancy levels, rental rates and operating costs on properties that were operational for two comparable periods. Other REITs may use different methodologies for calculating Same Store NOI, and accordingly, the Company’s Same Store NOI may not be comparable to other REITs.

     However, Same Store NOI should not be viewed as an alternative measure of the Company’s financial performance since it does not reflect the operations of the Company’s entire portfolio, nor does it reflect the impact of general and administrative expenses, acquisition-related expenses, interest expense, depreciation and amortization costs, other nonproperty income and losses, the level of capital expenditures and leasing costs necessary to maintain the operating performance of the Company’s properties, or trends in development and construction activities which are significant economic costs and activities that could materially impact the Company’s results from operations.

30

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Management Statements on Non-GAAP Supplemental Measures

EBITDA:

     Management believes that earnings before interest expense, depreciation and amortization, gain/loss on early extinguishment of debt, net gains and losses on disposition of discontinued operations, net income attributable to noncontrolling interests, preferred dividends and distributions, and impairment losses (“EBITDA”) is a useful supplemental measure of the Company’s operating performance. When considered with other GAAP measures and FFO, management believes EBITDA gives the investment community a more complete understanding of the Company’s operating results, including the impact of general and administrative expenses and acquisition-related expenses, before the impact of investing and financing transactions and facilitates comparisons with competitors. Management also believes it is appropriate to present EBITDA as it is used in several of the Company’s financial covenants for both its secured and unsecured debt. However, EBITDA should not be viewed as an alternative measure of the Company’s operating performance since it excludes financing costs as well as depreciation and amortization costs which are significant economic costs that could materially impact the Company’s results of operations and liquidity. Other REITs may use different methodologies for calculating EBITDA and, accordingly, the Company’s EBITDA may not be comparable to other REITs.

Funds From Operations:

     The Company calculates FFO in accordance with the White Paper on FFO approved by the Board of Governors of NAREIT. The White Paper defines FFO as net income or loss calculated in accordance with GAAP, excluding extraordinary items, as defined by GAAP, and gains and losses from sales of depreciable operating property, plus real estate-related depreciation and amortization (excluding amortization of deferred financing costs and depreciation of non-real estate assets), and after adjustment for unconsolidated partnerships and joint ventures.

     Management believes that FFO is a useful supplemental measure of the Company’s operating performance. The exclusion from FFO of gains and losses from the sale of operating real estate assets allows investors and analysts to readily identify the operating results of the assets that form the core of the Company’s activity and assists in comparing those operating results between periods. Also, because FFO is generally recognized as the industry standard for reporting the operations of REITs, it facilitates comparisons of operating performance to other REITs. However, other REITs may use different methodologies to calculate FFO, and accordingly, the Company’s FFO may not be comparable to all other REITs.

     Implicit in historical cost accounting for real estate assets in accordance with GAAP is the assumption that the value of real estate assets diminishes predictably over time. Since real estate values have historically risen or fallen with market conditions, many industry investors and analysts have considered presentations of operating results for real estate companies using historical cost accounting alone to be insufficient. Because FFO excludes depreciation and amortization of real estate assets, management believes that FFO along with the required GAAP presentations provides a more complete measurement of the Company’s performance relative to its competitors and a more appropriate basis on which to make decisions involving operating, financing and investing activities than the required GAAP presentations alone would provide.

     However, FFO should not be viewed as an alternative measure of the Company’s operating performance since it does not reflect either depreciation and amortization costs or the level of capital expenditures and leasing costs necessary to maintain the operating performance of the Company’s properties, which are significant economic costs and could materially impact the Company’s results from operations.

Funds Available for Distribution:

     Management believes that Funds Available for Distribution (“FAD”) is a useful supplemental measure of the Company’s liquidity. The Company computes FAD by adding to FFO the noncash amortization of deferred financing costs, debt discounts and share-based compensation awards, adjustment to GAAP gain/loss on early extinguishment of debt, amortization of above (below) market rents for acquisition properties and contractual cash rents received in advance of revenue recognition, then subtracting recurring tenant improvements, leasing commissions and capital expenditures, and eliminating the net effect of straight-line rents, amortization of deferred revenue related to tenant improvements and cash received prior to revenue recognition. FAD provides an additional perspective on the Company’s ability to fund cash needs and make distributions to stockholders by adjusting FFO for the impact of certain cash and noncash items, as well as adjusting FFO for recurring capital expenditures and leasing costs. Management also believes that FAD provides useful information to the investment community about the Company’s financial position as compared to other REITs since FAD is a liquidity measure used by other REITs. However, other REITs may use different methodologies for calculating FAD and, accordingly, the Company’s FAD may not be comparable to other REITs.

31

Kilroy Realty orporation
Second Quarter 2011 Supplemental Financial Report

Reconciliation of Same Store Net Operating Income to Net (Loss) Income Available to Common Stockholders
(unaudited, $ in thousands)

	Three Months Ended June 30,						Six Months Ended June 30,
	2011			2010			2011			2010
Same Store Cash Net Operating Income	$	45,757		$	41,647		$	89,611			84,636
Adjustments:
GAAP Operating Revenues Adjustments, net		5,100			5,714			10,936			10,104
GAAP Operating Expenses Adjustments, net		(120	)		12			(146	)		(14	)
Same Store GAAP Net Operating Income		50,737			47,373			100,401			94,726
Non-Same Store GAAP Net Operating Income		14,787			3,660			27,025			5,102
Net Operating Income, as defined(1)		65,524			51,033			127,426			99,828
Adjustments:
General and administrative expenses		(7,440	)		(6,728	)		(14,000	)		(13,823	)
Acquisition-related expenses		(1,194	)		(957	)		(1,666	)		(1,270	)
Depreciation and amortization		(32,248	)		(23,722	)		(61,559	)		(44,660	)
Interest income and other net investment gains (losses)		58			(18	)		242			366
Interest expense		(21,228	)		(13,088	)		(42,104	)		(25,044	)
Loss on early extinguishment of debt		—			(4,564	)		—			(4,564	)
Net Income		3,472			1,956			8,339			10,833
Net loss (income) attributable to noncontrolling common units of the Operating Partnership		10			60			(24	)		(132	)
Preferred distributions and dividends		(3,799	)		(3,799	)		(7,598	)		(7,598	)
Net (Loss) Income Available to Common Stockholders	$	(317	)	$	(1,783	)	$	717			3,103

(1) Please refer to page 30 for Management Statements on Net Operating Income and Same Store Net Operating Income.

32

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Reconciliation of EBITDA to Net (Loss) Income Available to Common Stockholders
(unaudited, $ in thousands)

	Three Months Ended June 30,
	2011			2010
Net (Loss) Income Available to Common Stockholders	$	(317	)	$	(1,783	)
Interest expense		21,228			13,088
Depreciation and amortization		32,248			23,722
Net (loss) income attributable to noncontrolling common units of the Operating Partnership		(10	)		(60	)
Loss on early extinguishment of debt		—			4,564
Preferred distributions and dividends		3,799			3,799
EBITDA (1)	$	56,948		$	43,330

(1) Please refer to page 31 for a Management Statement on EBITDA.

33

Kilroy Realty Corporation
Second Quarter 2011 Supplemental Financial Report

Reconciliation of Funds Available for Distribution to GAAP Net Cash Provided by Operating Activities
(unaudited, $ in thousands)

	Three Months Ended June 30,						Six Months Ended June 30,
	2011			2010			2011			2010
Funds Available for Distribution (1)	$	18,048		$	10,695		$	37,891		$	24,485
Adjustments:
Tenant improvements, leasing commissions and recurring capital expenditures		11,162			13,957			19,133			25,918
Depreciation for furniture, fixtures and equipment		278			221			530			431
Preferred distributions and dividends		3,799			3,799			7,598			7,598
Provision for uncollectible tenant recievables		120			(12	)		146			14
Changes in assets and liabilities and other adjustments, net (2)		(20,739	)		(4,840	)		(8,833	)		(1,058	)
GAAP Net Cash Provided by Operating Activities	$	12,668		$	23,820		$	56,465		$	57,388

(1)	Please refer to page 31 for a Management Statement on Funds Available for Distribution.
(2)	Primarily includes changes in the following assets and liabilities: marketable securities; current receivables; deferred leasing costs; prepaid expenses and other assets; accounts payable, accrued expenses and other liabilities; and rents received in advance and tenant security deposits.

34