Kilroy Realty Corp.
) acquired a Class A office campus - The Heights - in San Diego
for approximately $126 million. The move depicts company's aim to
strengthen its presence in high-end markets, through premium
office assets acquisitions.
The Heights, which boasts a wide range of modern amenities,
encompasses 13.8 acres and is situated in the Del Mar sub-market
of San Diego. The campus comprises an office building as well as
life science building, both of which are three-storied and
together span a total of around 219,000 square feet. An
underground parking structure is also included in the domain.
Both the buildings, which are LEED Silver certified, are fully
anchored by 5 high-end tenants that include Neurocrine Bioscience
and Knobbe Martens Olson & Bear.In addition, the campus has a
90,000 square foot land parcel permitted for a high-tech office
The Heights' location in one of the most thriving coastal
submarkets of San Diego and its proximity to important
transportation networks makes it an accretive buy for Kilroy
Realty. We expect the above-mentioned transaction to drive strong
rental revenue growth in the coming quarters.
Notably, The Heights has an initial cash return of around 6%
and is in proximity to Kilroy Realty's upcoming development
project, One Paseo. Hence, the company expects to generate
considerable combined gain from both the projects.
Kilroy Realty owns, develops and manages a diverse portfolio
of office, industrial and multi-purpose real estate properties
primarily in the coastal regions of Los Angeles, Orange County,
San Diego, greater Seattle and the San Francisco Bay Area. As of
Jun 30, 2013, the company owned 13.5 million rentable square feet
of office space.
Kilroy Realty currently carries a Zacks Rank #3 (Hold). Other
well-performing REITs include
Sovran Self Storage Inc.
Getty Realty Corp.
Highwoods Properties Inc.
). While Sovran Self Storage and Getty Realty carry a Zacks Rank
#1 (Strong Buy), Highwoods Properties has a Zacks Rank #2
GETTY REALTY CP (GTY): Free Stock Analysis
HIGHWOODS PPTYS (HIW): Free Stock Analysis
KILROY REALTY (KRC): Free Stock Analysis
SOVRAN SLF STOR (SSS): Free Stock Analysis
To read this article on Zacks.com click here.