8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15 (d) of

The Securities Exchange Act of 1934

Date of report (date of earliest event reported):  April 29, 2002

KILROY REALTY CORPORATION

(Exact name of registrant as specified in its charter)

Maryland	Commission File Number:	95-4598246
(State of other jurisdiction	1-12675	(I.R.S. Employer
of incorporation or organization)		Identification No.)

2250 East Imperial Highway, Suite 1200, El Segundo, California 90245

(Address of principal executive offices)

(310) 563-5500

(Registrant’s telephone number, including area code)

ITEM 9.    REGULATION FD DISCLOSURE

On April 29, 2002 the Company issued a press release announcing its earnings for the quarter ended March 31, 2002 and made publicly available certain supplemental information. The supplemental information is attached to this current report as Exhibit 99.1, and the press release is attached to this current report as Exhibit 99.2, and each are incorporated by reference to this report.

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: April 29, 2002

KILROY REALTY CORPORATION
By:	/s/    ANN MARIE WHITNEY
	Ann Marie Whitney Senior Vice-President and Controller

EXHIBIT INDEX

Exhibit Number		Description
99.1	*	First Quarter 2002 Supplemental Financial Report for the Quarter Ended March 31, 2002.
99.2	*	Press Release dated April 29, 2002.

* Filed herewith.

EX-99.1

EXHIBIT 99.1

KILROY

REALTY

CORPORATION

First Quarter 2002 Supplemental Financial Report

	Page
Financial Highlights	1
Consolidated Balance Sheets	2
Consolidated Statements of Operations	3
Operating Earnings, Funds From Operations and Funds Available for Distribution	4
Financial Results Excluding Recognition of Development LLC Preferred Return	5
Net Operating Income Breakdown	6
Same Store Analysis	7
Stabilized and Renovation Portfolio and Occupancy Overview	8
Leasing Activity	9
Lease Expiration Schedule	10
Dispositions	11
Stabilized Development	12
In-Process and Committed Development Projects	13
Future Development Pipeline	14
Capital Structure	15
Debt Analysis	16

Some of the enclosed information presented is forward-looking in nature, including information concerning 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 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. 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 “Business Risks” in Kilroy Realty Corporation’s annual report on Form 10-K for the year ended December 31, 2001. In light of these risks, uncertainties and assumptions, the forward-looking events contained in this supplement information might not occur.

KILROY REALTY CORPORATION

First Quarter 2002 Supplemental Financial Report

Financial Highlights

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

	Three Months Ended March 31,
	2002			2001			% Change
INCOME ITEMS:
Revenues	$	52,635		$	50,367		4.5	%
Net Operating Income		40,416			38,922		3.8	%
Net Income		13,507			6,426		110.2	%
Operating Earnings (1)		15,017			8,358		79.7	%
Funds From Operations		27,153			21,876		24.1	%
Funds Available for Distribution		26,368			19,532		35.0	%
Net Income per share—diluted	$	0.49		$	0.24		104.2	%
Operating Earnings per share—diluted	$	0.49		$	0.27		81.5	%
Funds From Operations per share—diluted	$	0.89		$	0.72		23.6	%
Funds Available for Distribution per share—diluted	$	0.86		$	0.64		34.4	%
Dividend per share	$	0.495		$	0.480		3.1	%
RATIOS:
Interest Coverage Ratio (2)		4.3	x		3.3	x
Fixed Charge Coverage Ratio (3)		3.2	x		2.5	x
FFO Payout Ratio (4)		55.8	%		66.4	%	(10.6	%)
FAD Payout Ratio (5)		57.5	%		74.4	%	(16.9	%)

	Mar. 31, 2002			Dec. 31, 2001			% Change
ASSETS:
Investments in Real Estate before Depreciation	$	1,661,622		$	1,600,994		3.8	%
Total Assets		1,506,491			1,457,229		3.4	%
CAPITALIZATION:
Total Debt	$	741,186		$	714,587		3.7	%
Total Preferred Stock (6)		155,000			155,000		—
Total Market Equity Value (6)		903,565			800,894		12.8	%
Total Market Capitalization (6)		1,799,751			1,670,481		7.7	%
Total Debt/Total Market Capitalization		41.2	%		42.8	%	(1.6	%)
Total Debt and Preferred/Total Market Capitalization		49.8	%		52.1	%	(2.3	%)

(1) Excludes effect of 2001 charge for cumulative effect of change in accounting principal of approximately $1.4 million.

(2) Calculated as income from operations before interest expense and depreciation and amortization divided by interest expense.

(3) Calculated as income from operations before interest expense and depreciation and amortization divided by interest expense and current year paid and accrued preferred dividends.

(4) Calculated as current year dividends paid and accrued to common shareholders divided by Funds From Operations.

(5) Calculated as current year dividends paid and accrued to common shareholders divided by Funds Available for Distribution.

(6) See “Capital Structure” on page 15.

1

KILROY REALTY CORPORATION

First Quarter 2002 Supplemental Financial Report

Consolidated Balance Sheets

(unaudited, $ in thousands)

	March 31, 2002			December 31, 2001
ASSETS:
Land and improvements	$	277,842		$	269,366
Buildings and improvements		1,179,214			1,140,499
Undeveloped land and construction in progress		204,566			191,129
Total investment in real estate		1,661,622			1,600,994
Accumulated depreciation and amortization		(248,702	)		(241,665	)
Investment in real estate, net		1,412,920			1,359,329
Cash and cash equivalents		10,432			16,487
Restricted cash		5,984			5,413
Tenant receivables, net		30,051			32,151
Deferred financing and leasing costs, net		42,208			37,068
Prepaid expenses and other assets		4,896			6,781
TOTAL ASSETS	$	1,506,491		$	1,457,229
LIABILITIES AND STOCKHOLDERS’ EQUITY:
Liabilities:
Secured debt	$	457,186		$	459,587
Unsecured line of credit		284,000			155,000
Unsecured term facility					100,000
Accounts payable, accrued expenses and other liabilities		49,745			53,879
Accrued distributions		15,163			14,634
Rents received in advance and tenant security deposits		15,155			15,955
Total liabilities		821,249			799,055
Minority Interests:
8.075% Series A Cumulative Redeemable Preferred unitholders		73,716			73,716
9.375% Series C Cumulative Redeemable Preferred unitholders		34,464			34,464
9.250% Series D Cumulative Redeemable Preferred unitholders		44,321			44,321
Common unitholders of the Operating Partnership		74,477			49,176
Minority interest in Development LLCs					15,869
Total minority interests		226,978			217,546
Stockholders’ Equity:
Common stock		275			274
Additional paid-in capital		494,354			479,295
Distributions in excess of earnings		(33,305	)		(33,163	)
Accumulated net other comprehensive loss		(3,060	)		(5,778	)
Total stockholders’ equity		458,264			440,628
TOTAL LIABILITIES & STOCKHOLDERS’ EQUITY	$	1,506,491		$	1,457,229

2

KILROY REALTY CORPORATION

First Quarter 2002 Supplemental Financial Report

Consolidated Statements of Operations

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

	Three Months Ended March 31,
	2002			2001			% Change
REVENUES:
Rental income	$	45,295		$	44,379		2.1	%
Tenant reimbursements		5,618			5,520		1.8	%
Interest income		285			436		(34.6	%)
Other income		1,437			32		4390.6	%
Total revenues		52,635			50,367		4.5	%
EXPENSES:
Property expenses		7,701			6,982		10.3	%
Real estate taxes		3,850			3,635		5.9	%
General and administrative expenses		2,968			3,089		(3.9	%)
Ground leases		383			392		(2.3	%)
Interest expense		9,359			10,791		(13.3	%)
Depreciation and amortization		12,866			13,611		(5.5	%)
Total expenses		37,127			38,500		(3.6	%)
INCOME FROM OPERATIONS		15,508			11,867		30.7	%
Net gains on dispositions of operating properties					305		(100.0	%)
INCOME BEFORE MINORITY INTERESTS AND CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE		15,508			12,172		27.4	%
MINORITY INTERESTS:
Distributions on Cumulative Redeemable Preferred units		(3,375	)		(3,375	)	0.0	%
Minority interest in earnings of Operating Partnership		(1,510	)		(845	)	78.7	%
Recognition of previously reserved Development LLC preferred return		3,908					100.0	%
Minority interest in earnings of Development LLCs		(1,024	)		(134	)	664.2	%
Total minority interests		(2,001	)		(4,354	)	(54.0	%)
NET INCOME BEFORE CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE		13,507			7,818		72.8	%
CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE					(1,392	)	100.0	%
NET INCOME	$	13,507		$	6,426		110.2	%
Weighted average shares outstanding—basic		27,256			26,713
Weighted average shares outstanding—diluted		27,550			26,971
NET INCOME PER COMMON SHARE:
Net Income per common share—basic	$	0.50		$	0.24		108.3	%
Net Income per common share—diluted	$	0.49		$	0.24		104.2	%

3

KILROY REALTY CORPORATION

First Quarter 2002 Supplemental Financial Report

Operating Earnings, Funds From Operations and Funds Available for Distribution

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

	Three Months Ended March 31,
	2002			2001			% Change
OPERATING EARNINGS:
Net income	$	13,507		$	6,426		110.2	%
Adjustments:
Minority interest in earnings of Operating Partnership		1,510			845		78.7	%
Net gains on dispositions of operating properties					(305	)	100.0	%
Cumulative effect of change in accounting principle					1,392		(100.0	%)
Operating Earnings	$	15,017		$	8,358		79.7	%
Weighted average common shares/units outstanding—basic		30,317			30,225
Weighted average common shares/units outstanding—diluted		30,611			30,484
Operating Earnings per common share/unit—basic	$	0.50		$	0.28		78.6	%
Operating Earnings per common share/unit—diluted	$	0.49		$	0.27		81.5	%
FUNDS FROM OPERATIONS:
Operating Earnings	$	15,017		$	8,358		79.7	%
Adjustments:
Depreciation and amortization		12,136			12,970		(6.4	%)
Non-cash amortization of restricted stock grants (1)					548		(100.0	%)
Funds From Operations	$	27,153		$	21,876		24.1	%
FFO per common share/unit—basic	$	0.90		$	0.72		25.0	%
FFO per common share/unit—diluted	$	0.89		$	0.72		23.6	%
FUNDS AVAILABLE FOR DISTRIBUTION:
Funds From Operations	$	27,153		$	21,876		24.1	%
Adjustments:
Amortization of deferred financing costs		778			381		104.2	%
Tenant improvements, leasing commissions and recurring capital expenditures		(335	)		(1,011	)	(66.9	%)
Net effect of straight-line rents		(1,228	)		(1,714	)	(28.4	%)
Funds Available for Distribution	$	26,368		$	19,532		35.0	%
FAD per common share/unit—basic	$	0.87		$	0.65		33.8	%
FAD per common share/unit—diluted	$	0.86		$	0.64		34.4	%

(1) Commencing January 1, 2002, non-cash amortization of restricted stock grants is not added back to calculate Funds From Operations.

4

KILROY REALTY CORPORATION

First Quarter 2002 Supplemental Financial Report

Financial Results Excluding Impact of Recognition of

Previously Reserved Development LLC Preferred Return

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

	Three Months Ended March 31,
	2002			2001			% Change
OPERATING EARNINGS:
Operating Earnings as Reported	$	15,017		$	8,358		79.7	%
Recognition of previously reserved Development LLC preferred return		(3,908	)
Operating Earnings excluding impact of preferred return	$	11,109		$	8,358		32.9	%
Weighted average common shares/units outstanding—diluted		30,611			30,484
Adjusted Operating Earnings per common share/unit—diluted	$	0.36		$	0.27		33.3	%
FUNDS FROM OPERATIONS:
Funds From Operations As Reported	$	27,153		$	21,876		24.1	%
Recognition of previously reserved Development LLC preferred return		(3,908	)
FFO excluding impact of preferred return	$	23,245		$	21,876		6.3	%
Adjusted FFO per common share/unit—diluted	$	0.76		$	0.72		5.6	%
FUNDS AVAILABLE FOR DISTRIBUTION:
Funds Available for Distribution as Reported	$	26,368		$	19,532		35.0	%
Recognition of previously reserved Development LLC preferred return		(3,908	)
FAD excluding impact of preferred return	$	22,460		$	19,532		15.0	%
Adjusted FAD per common share/unit—diluted	$	0.73		$	0.64		14.1	%
RATIOS:
Interest Coverage Ratio		3.9x			3.3x
Fixed Charge Coverage Ratio		2.9x			2.5x
FFO Payout Ratio		65.2	%		66.4	%	(1.2	%)
FAD Payout Ratio		67.5	%		74.4	%	(6.9	%)

5

KILROY REALTY CORPORATION

First Quarter 2002 Supplemental Financial Report

Net Operating Income Breakdown

	As of March 31, 2002(1)
% OF TOTAL NOI BY PRODUCT TYPE:
Office:
Los Angeles	33.1%
Orange County	4.1%
San Diego	35.2%
Other	5.5%
Subtotal	77.9%
Industrial:
Los Angeles	3.1%
Orange County	17.8%
Other	1.2%
Subtotal	22.1%
% OF TOTAL NOI BY REGION:
Los Angeles	36.2%
Orange County	21.9%
San Diego	35.2%
Other	6.7%
Total	100.0%

(1) Based on Net Operating Income for the quarter ended March 31, 2002.

6

KILROY REALTY CORPORATION

First Quarter 2002 Supplemental Financial Report

Same Store Analysis⁽¹⁾

($ in thousands)

	Three Months Ended March 31,
	2002		2001		$ Change		% Change
TOTAL SAME STORE PORTFOLIO
Operating Revenues:
Rental income	$	40,071	$	39,905	$	166	0.4	%
Tenant reimbursements		4,885		4,690		195	4.2	%
Other income		1,321		111		1,210	1090.1	%
Total operating revenues		46,277		44,706		1,571	3.5	%
Operating Expenses:
Property expenses		6,452		6,150		302	4.9	%
Real estate taxes		3,374		3,225		149	4.6	%
Ground leases		333		332		1	0.3	%
Total operating expenses		10,159		9,707		452	4.7	%
Net Operating Income	$	36,118	$	34,999	$	1,119	3.2	%

(1) Same store defined as all stabilized properties owned at January 1, 2001 and still owned at March 31, 2002.

7

KILROY REALTY CORPORATION

First Quarter 2002 Supplemental Financial Report

Stabilized and Renovation Portfolio and Occupancy Overview

	# of Buildings	Square Feet			Occupancy at:
		Total	Leased	Available	3/31/2002		12/31/2001		12/31/2000
STABILIZED PORTFOLIO:
OCCUPANCY BY PRODUCT TYPE:
Office:
Los Angeles	31	3,177,788	2,666,511	511,277	83.9	%	88.1	%	97.3	%
Orange County	12	546,850	490,345	56,505	89.7	%	89.7	%	73.6	%
San Diego	39	2,922,514	2,853,604	68,910	97.6	%	100.0	%	100.0	%
Other	6	709,575	695,996	13,579	98.1	%	99.0	%	98.2	%
Subtotal	88	7,356,727	6,706,456	650,271	91.2	%	93.9	%	96.2	%
Industrial:
Los Angeles	7	554,490	553,068	1,422	99.7	%	99.4	%	99.8	%
Orange County	52	4,236,038	4,161,940	74,098	98.3	%	98.3	%	97.1	%
Other	2	295,417	295,417	—	100.0	%	100.0	%	100.0	%
Subtotal	61	5,085,945	5,010,425	75,520	98.5	%	98.5	%	97.8	%
OCCUPANCY BY REGION:
Los Angeles	38	3,732,278	3,219,579	512,699	86.3	%	89.8	%	97.7	%
Orange County	64	4,782,888	4,652,285	130,603	97.3	%	97.3	%	94.2	%
San Diego	39	2,922,514	2,853,604	68,910	97.6	%	100.0	%	100.0	%
Other	8	1,004,992	991,413	13,579	98.6	%	99.3	%	99.1	%
TOTAL STABILIZED PORTFOLIO	149	12,442,672	11,716,881	725,791	94.2	%	95.8	%	97.0	%
RENOVATION PORTFOLIO:
Office:
Orange County	1	78,016	—	78,016
TOTAL PORTFOLIO	150	12,520,688	11,716,881	803,807

AVERAGE OCCUPANCY—STABILIZED PORTFOLIO (1)							AVERAGE OCCUPANCY—SAME STORE PORTFOLIO
	Three Months Ended March 31,								Three Months Ended March 31,
	2002		2001		% Change				2002		2001		% Change
Office	91.8	%	96.0	%	(4.2	%)		Office	93.3	%	95.8	%	(2.5	%)
Industrial	98.5	%	97.8	%	0.7	%		Industrial	98.5	%	97.8	%	0.7	%
Total	94.6	%	96.8	%	(2.2	%)		Total	95.6	%	96.7	%	(1.1	%)

(1) Represents the average occupancy for the properties in the stabilized portfolio for each period, respectively.

8

KILROY REALTY CORPORATION

First Quarter 2002 Supplemental Financial Report

Leasing Activity

Quarter-to-Date

					2nd Generation
	# of Leases(1)		Square Feet(1)		TI/LC Per Sq. Ft.		Maintenance Capex Per Sq. Ft. (2)		Changes in Rents (3)		Changes in Cash Rents (4)		Retention Rates (5)		Weighted Average Lease Term (Mo.)
	New	Renewal	New	Renewal
Office	4	13	95,881	130,979	$	7.64	$	0.00	(1.2	%)	1.1	%	30.4	%	46
Industrial	9	7	121,574	94,475	$	1.55	$	0.00	0.5	%	6.3	%	43.9	%	67
Total	13	20	217,455	225,454	$	5.09	$	0.00	(0.8	%)	2.2	%	34.9	%	56

(1) Includes first and second generation space, net of month-to-month leases. Excludes leasing on new construction. First generation space is defined as the space first leased by the Company.

(2) Calculated over entire stabilized portfolio.

(3) Calculated as the change between GAAP rents for new/renewed leases and the expiring GAAP rents for the same space.

(4) Calculated as the change between stated rents for new/renewed leases and the expiring stated rents for the same space.

(5) Calculated as the percentage of space either renewed or expanded into by existing tenants at lease expiration.

9

KILROY REALTY CORPORATION

First Quarter 2002 Supplemental Financial Report

Lease Expiration Schedule

($ in thousands)

Year of Expiration	# of Expiring Leases	Total Square Feet(1)		% of Total Leased Sq. Ft.		Annual Base Rent		Annual Rent per Sq. Ft.
OFFICE:
Remaining 2002	37	183,950		2.8	%	$	3,141	$	17.08
2003	62	774,070		11.7	%		12,922		16.69
2004	62	809,357		12.2	%		18,106		22.37
2005	53	916,424		13.8	%		16,312		17.80
2006	42	567,181		8.5	%		13,715		24.18
2007	20	664,318		10.0	%		12,166		18.31
2008	12	602,020		9.1	%		17,469		29.02
2009	9	682,104		10.3	%		16,154		23.68
2010	8	282,263		4.3	%		8,184		28.99
2011 and beyond	16	1,145,408		17.3	%		36,208		31.61
Subtotal	321	6,627,095		100.0	%	$	154,377	$	23.29
INDUSTRIAL:
Remaining 2002	19	75,080		1.5	%	$	666	$	8.87
2003	32	526,844		10.7	%		3,449		6.55
2004	25	550,375		11.2	%		4,103		7.45
2005	17	766,832		15.6	%		5,849		7.63
2006	10	590,638		12.0	%		4,775		8.08
2007	8	337,006		6.9	%		2,820		8.37
2008	5	752,946		15.3	%		6,066		8.06
2009	7	505,976		10.3	%		3,654		7.22
2010	2	70,101		1.4	%		596		8.50
2011 and beyond	6	745,226		15.1	%		7,875		10.57
Subtotal	131	4,921,024		100.0	%	$	39,853	$	8.10
TOTAL PORTFOLIO:
Remaining 2002	56	259,030		2.2	%	$	3,807	$	14.70
2003	94	1,300,914		11.3	%		16,371		12.58
2004	87	1,359,732		11.8	%		22,209		16.33
2005	70	1,683,256		14.6	%		22,161		13.17
2006	52	1,157,819		10.0	%		18,490		15.97
2007	28	1,001,324		8.7	%		14,986		14.97
2008	17	1,354,966		11.7	%		23,535		17.37
2009	16	1,188,080		10.3	%		19,808		16.67
2010	10	352,364		3.0	%		8,780		24.92
2011 and beyond	22	1,890,634		16.4	%		44,083		23.32
Total	452	11,548,119	(1)	100.0	%	$	194,230	$	16.82

(1) Excludes space leased under month-to-month leases and vacant space at March 31, 2002.

10

KILROY REALTY CORPORATION

First Quarter 2002 Supplemental Financial Report

2002 Dispositions

($ in thousands)

Project	Location	Type	Month of Disposition	Square Feet	Sales Price
1st QUARTER:
NONE
TOTAL YEAR-TO-DATE DISPOSITIONS

11

KILROY REALTY CORPORATION

First Quarter 2002 Supplemental Financial Report

Stabilized Development

($ in thousands)

Project	Location	Type	Start Date	Completion Date	Rentable Square Feet	Total Est. Investment		% Occupied
1st QUARTER:
Innovation Corporate Center— Lot 12	San Diego, CA	Office	2Q 2000	2Q 2001	70,617	$	15,625	100	%
Sorrento Gateway— Lot 4	San Diego, CA	Office	2Q 2001	1Q 2002	60,662		16,667	100	%
Subtotal					131,279		32,292	100	%
TOTAL YEAR-TO-DATE DISPOSITIONS					131,279	$	32,292	100	%

Some of the enclosed information presented is forward-looking in nature, including information concerning 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 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. 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”Business Risks” in Kilroy Realty Corporation’s annual report on Form 10-K for the year ended December 31, 2001. In light of these risks, uncertainties and assumptions, the forward-looking events contained contained in this supplement information might not occur.

12

KILROY REALTY CORPORATION

First Quarter 2002 Supplemental Financial Report

In-Process and Committed Development Projects

($ in thousands)

Project	Location	Type	Estimated Construction Period		Est. Stabilization Date(1)	Rentable Square Feet	Total Estimated Investment		% Leased		% LOI		% Committed (2)
			Start Date	Compl. Date
PROJECTS IN LEASE-UP:
Calabasas Park Centre— Phase II(3)	Calabasas, CA	Office	2Q 2000	2Q 2001	2Q 2002	98,706	$	22,026	89	%	7	%	96	%
Innovation Corporate Center—Lot 8	San Diego, CA	Office	2Q 2000	2Q 2001	2Q 2002	46,759		9,401	51	%	0	%	51	%
Pacific Corporate Center—Lots 25 & 27(4)	San Diego, CA	Office	2Q 2001	4Q 2001	2Q 2002	68,400		18,005	100	%	0	%	100	%
Subtotal						213,865	$	49,432	85	%	3	%	88	%
PROJECTS UNDER CONSTRUCTION:
Brobeck, Phleger & Harrison Expansion	Del Mar, CA	Office	3Q 2001	3Q 2002	3Q 2002	89,168	$	22,490	100	%	0	%	100	%
Imperial & Sepulveda	El Segundo, CA	Office	1Q 2001	3Q 2002	2Q 2003	133,678		40,471	0	%	0	%	0	%
Peregrine Systems Corporate Ctr-Bld 4	Del Mar, CA	Office	3Q 2001	3Q 2002	2Q 2003	114,780		28,324	100	%	0	%	100	%
Westside Media Center—Phase III	West LA, CA	Office	4Q 2000	2Q 2002	2Q 2003	151,000		56,404	0	%	0	%	0	%
Subtotal						488,626	$	147,689	42	%	0	%	42	%
TOTAL PROJECTS IN LEASE UP AND UNDER CONSTRUCTION						702,491	$	197,121	55	%	1	%	56	%
COMMITTED DEVELOPMENT:
San Diego Corporate Center	Del Mar, CA	Office	2Q 2002	3Q 2003	3Q 2004	208,961		65,456	84	%	0	%	84	%
Subtotal						207,842	$	65,456	87	%	0	%	87	%
TOTAL IN-PROCESS AND COMMITTED DEVELOPMENT PROJECTS:						911,452	$	262,577	61	%	1	%	62	%

(1) Based on management’s estimation of the earlier of stabilized occupancy (95%) or one year from the date of substantial completion.

(2) Includes executed leases and signed letters of intent, calculated on a square footage basis.

(3) This project was added to the Company’s stabilized portfolio in April 2002.

(4) This project is 100% leased to one tenant. It is expected that the tenant will take occupancy of 100% of the space in the second quarter of 2002.

Some of the enclosed information presented is forward-looking in nature, including information concerning 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 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. 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 “Business Risks” in Kilroy Realty Corporation’s annual report on Form 10-K for the year ended December 31, 2001. In light of these risks, uncertainties and assumptions the forward-looking events contained in this supplemental information might not occur.

13

KILROY REALTY CORPORATION

First Quarter 2002 Supplemental Financial Report

Future Development Pipeline

($ in thousands)

Project	Location	Type	Rentable Square Feet	Total Estimated Investment
SAN DIEGO COUNTY:
Innovation Corporate Center—Lot 2	San Diego, CA	Office	51,187	$	10,101
Innovation Corporate Center—Lot 4	San Diego, CA	Office	75,000		13,701
Innovation Corporate Center—Lot 9	San Diego, CA	Office	65,867		12,408
Innovation Corporate Center—Lot 10	San Diego, CA	Office	37,405		7,882
Pacific Corporate Center—Lots 3, 4 & 6	San Diego, CA	Office	225,000		47,722
Pacific Corporate Center—Lot 8	San Diego, CA	Office	116,157		25,006
Santa Fe Summit—Phase I	San Diego, CA	Office	150,000		33,817
Santa Fe Summit—Phase II	San Diego, CA	Office	150,000		34,360
Sorrento Gateway—Lot 1	San Diego, CA	Office	61,000		17,089
Sorrento Gateway—Lot 2	San Diego, CA	Office	80,000		24,006
Sorrento Gateway—Lot 3	San Diego, CA	Office	60,000		18,497
Sorrento Gateway—Lot 7	San Diego, CA	Office	57,000		18,605
Subtotal			1,128,616	$	263,194
TOTAL FUTURE DEVELOPMENT PIPELINE			1,128,616	$	263,194

Some of the enclosed information presented is forward-looking in nature, including information concerning 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 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. 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 “Business Risks” in Kilroy Realty Corporation’s annual report on Form 10-K for the year ended December 31, 2001. In light of these risks, uncertainties and assumptions, the forward-looking events contained in this supplement information might not occur.

14

KILROY REALTY CORPORATION

First Quarter 2002 Supplemental Financial Report

Capital Structure

At March 31, 2002

($ in thousands)

	Shares/Units at March 31, 2002	Aggregate Principal Amount or $ Value Equivalent		% of Total Market Capitalization
DEBT:
Secured Debt		$	457,186	25.4	%
Unsecured Line of Credit			284,000	15.8	%
Total Debt		$	741,186	41.2	%
EQUITY:
8.075% Series A Cumulative Redeemable Preferred Units (1)	1,500,000	$	75,000	4.2	%
9.375% Series C Cumulative Redeemable Preferred Units (1)	700,000		35,000	1.9	%
9.250% Series D Cumulative Redeemable Preferred Units (1)	900,000		45,000	2.5	%
Common Units Outstanding (2)	4,458,022		125,760	7.0	%
Common Shares Outstanding (2)	27,571,948		777,805	43.2	%
Total Equity		$	1,058,565	58.8	%
TOTAL MARKET CAPITALIZATION		$	1,799,751	100.0	%

(1) Value based on $50.00 per share liquidation preference.

(2) Valued based on closing share price of $28.21 at March 31, 2002.

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KILROY REALTY CORPORATION

First Quarter 2002 Supplemental Financial Report

Debt Analysis

At March 31, 2002

($ in thousands)

SECURED DEBT PRINCIPAL REPAYMENT SCHEDULE

2002	2003	2004	2005	2006	Thereafter	Total
$5,305	$95,335	$28,636	$88,933	$37,084	$201,893	$457,186

TOTAL DEBT COMPOSITION

	% of Total Debt		Weighted Average
			Interest Rate		Maturity
Secured vs. Unsecured Debt:
Secured Debt	61.7	%	6.5	%	6.0
Unsecured Debt	38.3	%	5.3	%	3.0
Floating vs. Fixed Rate Debt:
Fixed Rate Debt (1),(2),(4)	70.8	%	7.1	%	5.7
Floating Rate Debt (3)	29.2	%	3.5	%	2.8
Total Debt			6.1	%	4.9

UNSECURED LINE OF CREDIT

Total Line	Outstanding Balance	Expiration Date
$425,000	$284,000	March 2005

CAPITALIZED INTEREST

Quarter-to-Date	Year-to-Date
$3.8	$3.8

(1) The Company currently has an interest-rate swap agreement, which expires in November 2002, to fix LIBOR on $150 million of its floating rate debt at 5.48%.

(2) The Company currently has an interest-rate swap agreement, which expires in January 2005, to fix LIBOR on $50 million of its floating rate debt at 4.46%.

(3) The Company currently has interest-rate cap agreements, which expire in January 2005, to cap LIBOR on $100 million of its floating rate debt at 4.25%.

(4) The percentage of fixed rate debt to total debt does not take into consideration the portion of floating rate debt capped by the Company’s interest-rate cap agreements. Including the effects of the interest-rate cap agreements, the Company had fixed or capped approximately 84.3% of its total outstanding debt at March 31, 2002.

16

EX-99.2

Exhibit 99.2

Contact:	FOR RELEASE:
Richard E. Moran Jr.	April 29, 2002

Executive Vice President

and Chief Financial Officer

(310) 563-5533

or

Tyler H. Rose

Senior Vice President

and Treasurer

(310) 563-5531

KILROY REALTY CORPORATION REPORTS

FIRST QUARTER FINANCIAL RESULTS

LOS ANGELES, April 29, 2002—Kilroy Realty Corporation (NYSE: KRC) today reported financial results for its first quarter ended March 31, 2002, with net income of $13.5 million, or $0.49 per share, on revenues of $52.6 million. Included in the company’s first-quarter earnings is $3.9 million, or $0.13 per share, of non-recurring preferred return income. In the first quarter of 2001, KRC reported net income of $6.4 million, or $0.24 per share, on revenues of $50.4 million.

Funds from operations (FFO) totaled $27.2 million, or $0.89 per share, compared to $21.9 million, or $0.72 per share in the prior year’s first quarter.

All per-share amounts in this report are presented on a diluted basis.

As previously reported, the company completed in the first quarter the buyout of the remaining real estate interests in twelve properties from The Allen Group. In connection with that transaction, KRC recognized $0.13 per share of preferred return income on its equity investment that had been earned previously but had been fully reserved for financial reporting purposes until the buyout was completed and the related litigation between the parties was settled.

1

KRC completed and stabilized $32 million of new development in the first quarter of 2002, adding an aggregate 131,300 square feet of space in two new office properties to its portfolio. At quarter’s end, the company’s stabilized portfolio was 94.2% occupied.

KRC has an additional 910,000 square feet of space currently in lease-up, under construction or committed for construction representing a total estimated investment of approximately $263 million. These properties are 62% leased or committed.

Some of the information presented in this release is forward-looking in nature within the meaning of the Private Securities Litigation Reform Act of 1995. Although Kilroy Realty Corporation believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, there can be no assurance that its expectations will be achieved. Certain factors that could cause actual results to differ materially from Kilroy Realty’s expectations are set forth as risk factors in the company’s Securities and Exchange Commission reports and filings. Included among these factors are changes in general economic conditions, including changes in the economic conditions affecting industries in which its principal tenants compete; any failure of the general economy to recover timely from the current economic downturn; Kilroy Realty’s ability to timely lease or re-lease space at current or anticipated rents; changes in interest rates; changes in operating costs, including utility costs; future demand for its debt and equity securities; its ability to refinance its debt on reasonable terms at maturity; its ability to complete current and future development projects on schedule and on budget; the demand for office space in markets in which Kilroy Realty has a presence; and risks detailed from time to time in the company’s SEC reports, including quarterly reports on Form 10-Q, reports on Form 8-K and annual reports on Form 10-K. Many of these factors are beyond Kilroy Realty’s ability to control or predict. Forward-looking statements are not guarantees of performance. For forward-looking statements herein, Kilroy Realty claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. The company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.

Kilroy Realty Corporation is a Southern California-based real estate investment trust active in the office and industrial property sectors. For more than 50 years, the company

2

has owned, developed, acquired and managed real estate assets primarily in the coastal regions of California and Washington. Principal submarkets for KRC’s current development program include West Los Angeles, El Segundo and coastal San Diego, where the company’s total development pipeline is more than $500 million. At March 31, 2002, the company owned 7.4 million square feet of commercial office space and 5.1 million square feet of industrial space.

#########################

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KILROY REALTY CORPORATION

SUMMARY QUARTERLY RESULTS

(unaudited, in thousands, except per share data)

	Three Months Ended March 31, 2002			Three Months Ended March 31, 2001
Revenues	$	52,635		$	50,367
Net Income available to common stockholders (1)	$	13,507		$	6,426
Weighted average common shares outstanding—basic		27,256			26,713
Weighted average common shares outstanding—diluted		27,550			26,971
Net Income per share of common stock—basic	$	0.50		$	0.24
Net Income per share of common stock—diluted	$	0.49		$	0.24
Operating Earnings (2)	$	15,017		$	8,358
Weighted average common shares/units outstanding—basic (3)		30,317			30,225
Weighted average common shares/units outstanding—diluted (3)		30,611			30,484
Operating Earnings per common share/unit—basic (3)	$	0.50		$	0.28
Operating Earnings per common share/unit—diluted (3)	$	0.49		$	0.27
Funds From Operations	$	27,153		$	21,876
Funds From Operations per common share/unit—basic (3)	$	0.90		$	0.72
Funds From Operations per common share/unit—diluted (3)	$	0.89		$	0.72
Common shares outstanding at end of period		27,572			26,975
Common partnership units outstanding at end of period		4,458			3,282
Total common shares and units outstanding at end of period		32,030			30,257
	March 31, 2002			March 31, 2001
Occupancy rates:
California		93.9	%		96.4	%
Washington		98.3	%		100.0	%
Arizona		100.0	%		100.0	%
Nevada					100.0	%
Weighted average total		94.2	%		96.6	%
Total square feet of stabilized properties owned at end of period:
Office		7,357			7,064
Industrial		5,086			5,768
Total		12,443			12,832

(1) Net Income after minority interests.

(2) Excludes effect of 2001 charge for cumulative effect of change in accounting principle of $1.4 million.

(3) Calculated based on weighted average shares outstanding assuming conversion of all common limited partnership units outstanding.

4

KILROY REALTY CORPORATION CONSOLIDATED BALANCE SHEETS

(unaudited, in thousands)

	March 31, 2002			December 31, 2001
ASSETS
INVESTMENT IN REAL ESTATE:
Land and improvements	$	277,842		$	269,366
Buildings and improvements		1,179,214			1,140,499
Undeveloped land and construction in progress		204,566			191,129
Total investment in real estate		1,661,622			1,600,994
Accumulated depreciation and amortization		(248,702	)		(241,665	)
Investment in real estate, net		1,412,920			1,359,329
Cash and cash equivalents		10,432			16,487
Restricted cash		5,984			5,413
Tenant receivables, net		30,051			32,151
Deferred financing and leasing costs, net		42,208			37,068
Prepaid expenses and other assets		4,896			6,781
TOTAL ASSETS	$	1,506,491		$	1,457,229
LIABILITIES & STOCKHOLDERS’ EQUITY
LIABILITIES:
Secured debt	$	457,186		$	459,587
Unsecured line of credit		284,000			155,000
Unsecured term facility					100,000
Accounts payable, accrued expenses and other liabilities		49,745			53,879
Accrued distributions		15,163			14,634
Rents received in advance and tenant security deposits		15,155			15,955
Total liabilities		821,249			799,055
MINORITY INTERESTS:
8.075% Series A Cumulative Redeemable
Preferred unitholders		73,716			73,716
9.375% Series C Cumulative Redeemable
Preferred unitholders		34,464			34,464
9.250% Series D Cumulative Redeemable
Preferred unitholders		44,321			44,321
Common unitholders of the Operating Partnership		74,477			49,176
Minority interest in Development LLCs					15,869
Total minority interests		226,978			217,546
STOCKHOLDERS’ EQUITY:
Common stock		275			274
Additional paid-in capital		494,354			479,295
Distributions in excess of earnings		(33,305	)		(33,163	)
Accumulated net other comprehensive loss		(3,060	)		(5,778	)
Total stockholders’ equity		458,264			440,628
TOTAL LIABILITIES & STOCKHOLDERS’ EQUITY	$	1,506,491		$	1,457,229

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KILROY REALTY CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited, in thousands, except per share data)

	Three Months Ended March 31, 2002			Three Months Ended March 31, 2001
REVENUES:
Rental income	$	45,295		$	44,379
Tenant reimbursements		5,618			5,520
Interest income		285			436
Other income		1,437			32
Total revenues		52,635			50,367
EXPENSES:
Property expenses		7,701			6,982
Real estate taxes		3,850			3,635
General and administrative expenses		2,968			3,089
Ground leases		383			392
Interest expense		9,359			10,791
Depreciation and amortization		12,866			13,611
Total expenses		37,127			38,500
Income from operations		15,508			11,867
Net gains on dispositions of operating properties					305
Income before minority interests and cumulative effect of change in accounting principle		15,508			12,172
Minority interests:
Distributions on Cumulative Redeemable Preferred units		(3,375	)		(3,375	)
Minority interest in earnings of Operating Partnership		(1,510	)		(845	)
Recognition of previously reserved Development LLC preferred return		3,908
Minority interest in earnings of Development LLCs		(1,024	)		(134	)
Total minority interests		(2,001	)		(4,354	)
Net income before cumulative effect of change in accounting principle		13,507			7,818
Cumulative effect of change in accounting principle					(1,392	)
Net income	$	13,507		$	6,426
Weighted average shares outstanding—basic		27,256			26,713
Weighted average shares outstanding—diluted		27,550			26,971
Net Income per common share—basic	$	0.50		$	0.24
Net Income per common share—diluted	$	0.49		$	0.24

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KILROY REALTY CORPORATION

OPERATING EARNINGS

(unaudited, in thousands, except per share data)

	Three Months Ended March 31, 2002		Three Months Ended March 31, 2001
Net income	$	13,507	$	6,426
Adjustments:
Minority interest in earnings of Operating Partnership		1,510		845
Net gains on dispositions of operating properties				(305	)
Cumulative effect of change in accounting principle				1,392
Operating Earnings	$	15,017	$	8,358
Weighted average common shares/units outstanding—basic		30,317		30,225
Weighted average common shares/units outstanding—diluted		30,611		30,484
Operating Earnings per common share/unit—basic	$	0.50	$	0.28
Operating Earnings per common share/unit—diluted	$	0.49	$	0.27

KILROY REALTY CORPORATION

FUNDS FROM OPERATIONS

(unaudited, in thousands, except per share data)

	Three Months Ended March 31, 2002		Three Months Ended March 31, 2001
Operating Earnings	$	15,017	$	8,358
Adjustments:
Depreciation and amortization		12,136		12,970
Non-cash amortization of restricted stock grants				548
Funds From Operations	$	27,153	$	21,876
Funds From Operations per common share/unit—basic	$	0.90	$	0.72
Funds From Operations per common share/unit—diluted	$	0.89	$	0.72

KILROY REALTY CORPORATION

FUNDS AVAILABLE FOR DISTRIBUTION

(unaudited, in thousands, except per share data)

	Three Months Ended March 31, 2002			Three Months Ended March 31, 2001
Funds From Operations	$	27,153		$	21,876
Adjustments:
Amortization of deferred financing costs		778			381
Tenant improvements, leasing commissions and recurring capital expenditures		(335	)		(1,011	)
Net effect of straight-line rents		(1,228	)		(1,714	)
Funds Available for Distribution	$	26,368		$	19,532
Funds Available for Distribution per common share/unit—basic	$	0.87		$	0.65
Funds Available for Distribution per common share/unit—diluted	$	0.86		$	0.64

7