KILROY REALTY CORP 8-K

What Happened

• In June 2026, Kilroy Realty’s operating partnership entered into amended and restated credit agreements with JPMorgan Chase Bank, N.A. and other lenders: a Fifth Amended and Restated Credit Agreement providing a senior unsecured revolving credit facility and an Amended and Restated Term Loan Agreement providing a $250 million senior unsecured term loan facility. Kilroy Realty Corporation guaranteed both facilities.
• The Credit Facility permits up to $1.25 billion of revolving borrowings (with a $100 million letter of credit sublimit) and an accordion to increase commitments or add term loans by up to $450 million (aggregate up to $1.7 billion). The Term Loan Facility totals $250 million (about $200 million currently outstanding) with up to $50 million of delayed draw commitments available through June 11, 2027, and an accordion to increase term loans by up to $150 million (aggregate term loans up to $400 million).

Key Details

• Credit Facility size: up to $1.25 billion revolver; $100 million LC sublimit; accordion potential to bring total to $1.7 billion.
• Credit Facility maturity: July 31, 2030, with up to two 6‑month extension options (extension fee = 6.25 bps of outstanding commitments subject to extension).
• Term Loan Facility: $250 million (≈$200M currently outstanding); delayed draw $50M available through June 11, 2027; final maturity July 31, 2031.
• Pricing: revolving loans tied to term SOFR or daily SOFR plus margins 0.675%–1.350% (or base rate + 0.000%–0.350%) depending on credit rating; term loans priced at SOFR + 0.75%–1.55% (or base rate + 0.00%–0.55%).
• Fees: facility fee on revolver 12.5–30 bps by rating; delayed-draw ticking fee 0.25% on unfunded delayed draw balances (after 90 days until one-year anniversary).
• Financial covenants include (summary): Max total debt / total asset value ≤60% (≤65% for short periods after a material acquisition); adjusted EBITDA / fixed charges ≥1.50x; max secured debt / total asset value ≤40% (≤45% post-acquisition); unencumbered asset value / unsecured debt ≥1.67x (≥1.55x post-acquisition); and unencumbered asset NOI / unsecured debt service ≥1.75x.
• Kilroy furnished a press release (Exhibit 99.1) with this disclosure.

Why It Matters

• These agreements refresh Kilroy’s liquidity and borrowing flexibility, providing a sizable revolving line and term loan capacity to fund acquisitions, development/redevelopment projects, general corporate needs, and debt repayment. That can support growth plans and refinance activity without immediate equity issuance.
• Pricing and availability are tied to Kilroy’s credit rating and financial covenants—so the company’s access to the full capacity and the cost of borrowing will depend on future credit metrics. The parent company guaranty means Kilroy Realty Corporation is on the hook for the operating partnership’s obligations.
• Investors should note the covenant limits and potential restrictions on dividends or transactions if events of default occur; these are standard credit protections but can affect capital allocation and financial flexibility if metrics weaken.