EX-12.1 3 dex121.htm STATEMENT OF COMPUTATION OF CONSOLIDATED RATIO OF EARNINGS Statement of Computation of Consolidated Ratio of Earnings

Exhibit 12.1

KILROY REALTY CORPORATION

Statement of Computation of Consolidated Ratio of Earnings to Combined Fixed Charges

and Preferred Dividends

(in thousands, except ratios)

 

    

2006

     2005     2004     2003     2002  

Earnings:

           

Income from continuing operations before minority interest

    $ 51,662     $ 8,787     $ 37,039     $ 60,643     $ 37,127  

Plus Fixed Charges:

           

Interest expense (including amortization of loan fees)

      43,541       38,956       33,678       30,056       30,088  

Capitalized interest and loan fees

      11,310       8,881       7,707       10,704       11,930  

Estimate of interest within rental expense

      1,252       1,238       1,242       1,195       1,099  

Distributions on Cumulative Redeemable
Preferred units

      5,588       5,588       9,579       13,163       13,500  
                                        

Fixed Charges

      61,691       54,663       52,206       55,118       56,617  

Plus: Amortization of capitalized interest(1)

      2,691       2,403       2,166       1,903       1,579  

Less: Capitalized interest and loan fees

      (11,310 )     (8,881 )     (7,707 )     (10,704 )     (11,930 )

Less: Distributions on Cumulative Redeemable
Preferred units

      (5,588 )     (5,588 )     (9,579 )     (13,163 )     (13,500 )
                                        

Earnings

    $ 99,146     $ 51,384     $ 74,125     $ 93,797     $ 69,893  
                                        

Combined Fixed Charges and Preferred Dividends:

           

Fixed Charges (from above)

      61,691       54,663       52,206       55,118       56,617  

Preferred Dividends

      9,608       9,608       3,553       349    
                                        

Combined Fixed Charges and Preferred Dividends

    $ 71,299     $ 64,271     $ 55,759     $ 55,467     $ 56,617  
                                        

Consolidated ratio of earnings to combined fixed
charges and preferred dividends

      1.39x       0.80x       1.33x       1.69x       1.23x  
                                        

Deficiency

      $ 12,887        
                

(1)

Amount represents an estimate of capitalized interest that has been amortized each year based on our established depreciation policy and an analysis of total interest costs and loan fees capitalized since 1997.

We have computed the consolidated ratio of earnings to combined fixed charges and preferred dividends by dividing earnings by combined fixed charges and preferred dividends. Earnings consists of income from continuing operations before the effect of minority interest plus fixed charges and amortization of capitalized interest, reduced by capitalized interest and loan fees and distributions on Cumulative Redeemable Preferred units. Fixed charges consist of interest costs, whether expensed or capitalized, amortization of loan fees, an estimate of the interest within rental expense, and distributions on Cumulative Redeemable Preferred units. For the year ended December 31, 2006, our earnings were adequate to cover combined fixed charges and preferred dividends.