
15.	Net (Loss) Income Available to Common Unitholders Per Unit of the Operating Partnership

The following table reconciles the numerator and denominator in computing the Operating Partnership’s basic and diluted per-unit computations for net (loss) income available to common unitholders for the three and six months ended June 30, 2011 and 2010:


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2011			2010			2011			2010
	(in thousands, except unit and per unit amounts)

Numerator:
Net income attributable to Kilroy Realty, L.P.	$	3,440		$	1,905		$	8,274		$	10,737
Preferred distributions		(3,799	)		(3,799	)		(7,598	)		(7,598	)

Net (loss) income available to common unitholders		(359	)		(1,894	)		676			3,139
Allocation to participating securities (nonvested units and RSUs)		(327	)		(305	)		(649	)		(604	)

Numerator for basic and diluted net (loss) income available to common unitholders	$	(686	)	$	(2,199	)	$	27		$	2,535

Denominator:
Basic weighted average vested units outstanding		59,407,687			52,019,774			56,731,316			48,397,625
Effect of dilutive securities-Exchangeable Notes and stock options		—			—			375,964			3,356

Diluted weighted average vested units and common unit equivalents outstanding		59,407,687			52,019,774			57,107,280			48,400,981

Basic earnings per unit:
Net (loss) income available to common unitholders per unit	$	(0.01	)	$	(0.04	)	$	0.00		$	0.05
Diluted earnings per unit:
Net (loss) income available to common unitholders per unit	$	(0.01	)	$	(0.04	)	$	0.00		$	0.05

The effect of the 4.25% Exchangeable Notes was not included in the Operating Partnership’s diluted earnings per unit calculation for the three and six months ended June 30, 2010 and the effect of the 3.25% Exchangeable Notes was not included in the Operating Partnership’s diluted earnings per unit calculation for the three and six months ended June 30, 2011 and 2010. The average trading price of the Company’s common stock on the NYSE was below the Exchangeable Notes exchange price for these periods; therefore, these instruments were not considered to be in the money for the purposes of the Operating Partnership’s diluted earnings per unit calculation for these periods (See Note 5). Additionally, the effect of the assumed exchange of the 4.25% Exchangeable Notes was not included in the Operating Partnership’s diluted earnings per unit calculation for the three months ended June 30, 2011 as it was anti-dilutive as a result of the net loss available to common unitholders.