Kilroy Realty Faces Mixed Market Signals: Hold Rating Amid Declining Occupancy and Rising Costs

John Kim, an analyst from BMO Capital, maintained the Hold rating on Kilroy Realty (KRC – Research Report). The associated price target remains the same with $37.00.

John Kim’s rating is based on a combination of factors reflecting Kilroy Realty’s current market conditions. The company experienced a decline in occupancy rates across most of its markets, with the exception of Austin, which indicates challenges in maintaining tenant retention. Additionally, the cash lease spreads have significantly worsened, showing a negative trend compared to the previous year’s average.
On the positive side, Kilroy Realty has managed to increase its residential occupancy rates and has entered into a land sale agreement, which could provide some financial benefits in the future. However, the overall leasing activity has decreased, and the costs associated with tenant improvements and leasing commissions have risen. These mixed signals contribute to the Hold rating, as the company faces both opportunities and challenges in the current market environment.

Kim covers the Real Estate sector, focusing on stocks such as Eastgroup Properties, Vornado Realty, and Easterly Government Properties. According to TipRanks, Kim has an average return of 0.3% and a 48.43% success rate on recommended stocks.