SEATTLE — Kilroy Realty Corp. (NYSE: KRC) has acquired two office properties in the Lake Union submarket of Seattle and has entered into an agreement to purchase a Bellevue office tower in the third quarter. Combined, the three separate transactions total $330 million.
“Seattle’s Bellevue, Eastside and Lake Union submarkets present a compelling set of characteristics that KRC looks for in its real estate portfolio,” says John Kilroy Jr., president and CEO of KRC. “These include an economically vibrant core, a unique coastal locations, a quality of life valued by fast-growing, knowledge-based businesses and their employees, and a regional approach to development that effectively limits supply.”
In Lake Union, the company purchased three-building Fremont Lake Union Center and Fremont Lake View, a 420,000-square-foot office campus, for $145 million. The property is fully leased, and tenants include Adobe Inc., Tableau Software and Ubermind. KRC assumed approximately $34 million of debt as part of the acquisiton.
In downtown Bellevue, KRC is in escrow to acquire the 417,000-square-foot Skyline Tower, a Class A office building, for $186 million. The transaction is expected to close during the third quarter. The 42-story tower is certified LEED Silver, and is 92 percent leased. Tenants include Expedia and Valve Corp. As part of the acquisition, the company will assume an $84 million in-place loan.
“With the purchase of Skyline Tower, KRC will own two of the top Class A multi-tenant office buildings in downtown Bellevue,” says Mike Shields, senior vice president of KRC’s Pacific Northwest region. “We expect downtown Bellevue to continue to be a location of choice for both technology and service companies that value high-quality amenities, proximity to mass transit and commuter convenience.”
After the acquisition closes, KRC will own approximately 1.7 million square feet of premier office space in the Puget Sound region. The company’s Seattle properties account for 10 percent of its portfolio on a square-foot basis.
“With a knowledgeable and experienced management team now in place, Seattle will continue to play an important role in the expansion of our West Coast real estate franchise and the growth of our brand as the region’s most innovative landlord,” Kilroy Jr. says.
KRC is a real estate investment trust headquartered in Los Angeles that is focused on Class A industrial and office assets throughout the West Coast. As of March 31, 2012, the company owns 11.8 million square feet of commercial office space and 3.4 million square feet of industrial space in Los Angeles, Orange County, San Diego, greater Seattle and the San Francisco Bay Area.
KRC’s share price closed at $44.84 on Monday, up from $39.07 on June 3, 2011.
— Savannah Duncan