Acquisitions

Operating Properties

During the nine months ended September 30, 2014, we acquired the one operating office property listed below, from an unrelated third party. The acquisition was funded with proceeds from 2013 and 2014 dispositions (see Note 13).

Property

Date of Acquisition

Number of

Buildings

Rentable Square

Feet

Occupancy as of September 30, 2014

Purchase

Price

(in millions)

401 Terry Avenue North, Seattle, WA

March 13, 2014

140,605

100.0%

106.1

The related assets, liabilities and results of operations of the acquired property are included in the consolidated financial statements as of the date of acquisition. The following table summarizes the estimated fair values of the assets acquired and liabilities assumed on the acquisition date:



	Total 2014 Acquisitions
	(in thousands)
Assets
Land and improvements	$	22,500
Buildings and improvements ⁽¹⁾	77,046
Deferred leasing costs and acquisition-related intangible assets ⁽²⁾	11,199
Total assets acquired	110,745
Liabilities
Deferred revenue and acquisition-related intangible liabilities ⁽³⁾	4,620
Total liabilities assumed	4,620
Net assets and liabilities acquired	$	106,125

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(1)	Represents buildings, building improvements and tenant improvements.


(2)	Represents in-place leases of approximately $9.3 million (with a weighted average amortization period of seven years) and leasing commissions of approximately $1.9 million (with a weighted average amortization period of seven years) at the time of the acquisition.


(3)	Represents below-market leases of approximately $4.6 million (with a weighted average amortization period of seven years).

Development Project Sites

During the nine months ended September 30, 2014, we acquired one undeveloped land site listed below from an unrelated third party. The acquisition was funded with proceeds from the Company’s at-the-market stock offering program (see Note 7) and disposition proceeds (see Note 13).



Project	Date of Acquisition	Type	Purchase Price (in millions)
Kilroy Mission Bay, San Francisco, CA ⁽¹⁾	May 23, 2014	Land	$	95.0

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(1)

In connection with this acquisition, we also assumed $2.3 million in accrued liabilities which are not included in the purchase price above. As of September 30, 2014, the purchase price and assumed liabilities are included in undeveloped land and construction in progress and the assumed liabilities are included in accounts payable, accrued expenses and other liabilities on our consolidated balance sheets.