Kilroy Realty Reports Ahead Of Estimates

Deutsche Bank has published a research report on Kilroy Realty Corporation KRC following the recent occupancy gains and capital deployment in the company's 3Q. In the report, Deutsche Bank writes "KRC reported 3Q FFO of $0.54/sh which was $0.01 ahead of our estimate and the consensus. Lower bad debt drove about 2c of upside to our estimate, partially offset by higher interest expense (1c). Occ rose 130bps q/q to 86.4%, ahead of our +100bps estimate though this appears to have been back-end weighted with average occ up only 30bps from the end of 2Q. The rise in occ was driven by lease-up of the industrial portfolio (+730bps), while office occ fell (-90bps). Cash rent spreads were down 6.8% on a blended basis, better than -11.6% in 2Q. Office spreads fell 2.9% (DBe -15%), while industrial spreads dropped 30.9% (DBe -25%). Cash SS NOI also improved rising 0.9% y/y this Q vs -9.6% last Q." Deutsche Bank maintains its Buy rating and $29 price target. Kilroy Realty Corporation closed yesterday at $34.17.