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Kilroy Picks Up $24M Property, Plans Development

RANCHO BERNARDO, CA-The Los Angeles-based REIT acquires the 303,000-sf office/R&D property from an information technology company. A year from now, Kilroy will begin repositioning the property and will develop an additional 600,000 sf to one million sf of office space in phases.

By Daniel D. Williams | Updated on October 02, 2005

RANCHO BERNARDO, CA-Los Angeles-based REIT Kilroy Realty Corp. continues its bullish attitude for the local real estate market with another large acquisition and development project in the pipeline. In the latest deal, Kilroy has acquired a 20-acre site along the I-15 corridor that is fully entitled and includes a 303,000-sf multi-use facility.Kilroy paid $24 million for the site. The building is currently occupied and houses office, engineering and manufacturing uses. Kilroy has agreed to keep the tenant, an information technology company, on a one-year lease.At the lease’s expiration, next fall, Kilroy will then begin a major redevelopment of the site. On tap is are plans to develop form 600,000 sf to one million sf of office space over several phases, according to Kilroy officials. The site has entitlements for 1.8 million sf of office and industrial space.This latest buy is another pickup in the area for Kilroy. Earlier this summer, the firm paid $24 million for a fully entitled 11-acre parcel along the newly completed SR-56. On the site, Kilroy plans to develop a 350,000-sf office project known as Santa Fe Summit Phase II. John B. Kilroy Jr., president and CEO of Kilroy Realty Corp., says the projects “continue KRC’s growth in the northern San Diego markets.”The Santa Fe project will be adjacent to Kilroy’s Santa Fe Summit Phase I, which is currently being planned and will count 466,000 sf of office space in four, four-story buildings when complete. Phase I is 78% preleased to Intuit Inc. Earlier this year, the maker of business applications such as Quicken and TurboTax, agreed to a 10-year, 365,000-sf lease at the office campus. As part of the agreement, Intuit will lease three of the four buildings being planned for the office campus.

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