The Los Angeles-based company has developed and leased virtually all its space in the market since entering it in 1999, says Steve Scott, senior vice president of Kilroy Realty. They've done it via build-to-suits for the likes of Peregrine Systems, Applied Micro Circuits Corp., Ericsson, Epicor Software and NeoPoint.

"North San Diego is rated first in the nation for investment opportunities because of consistently low vacancy rates and continued strong market absorption by a broad base of dominant industries," Scott says. "Kilroy's land portfolio and financial capacity are a solid foundation for new construction."

In the next three months alone, Kilroy expects to break ground on another 200,000 sf, including a 60,000-sf second phase for Diversa Corp., a global biotechnology company in Sorrento Mesa. The first, 75,000-sf phase of the company's headquarters, consisting of two stories of office and laboratory space, opened in the fourth quarter of 2000. The second phase is scheduled for completion in the first quarter of next year.