Climate Change Data

Environmental Metrics

ESG Focus Areas

• Energy Efficiency
• Water Efficiency
• Waste Reduction (Recycling & Composting)
• LEED Certifications
• Tenant Engagement
• Corporate Governance
• Community Outreach
• Human Resources
• Risk Management
• Climate Change

Environmental Achievements

• Decreased like-for-like yearly portfolio energy consumption by 2% despite a 1% increase in occupancy.
• Increased the percentage of portfolio certified under ENERGY STAR from 53% to 56% (36 buildings).
• Reduced like-for-like portfolio water usage by 1.8%.
• Maintained a recycling diversion rate of over 50% and extended composting services.
• Added 520,000 square feet of LEED-certified projects to the portfolio.

Social Achievements

• Launched a range of innovative tenant engagement projects (Demand Response, social media campaigns, trainings, competitions).
• Continued support for the Rozalia Project, assisting in the removal of over 40,000 pieces of marine debris.

Governance Achievements

• Established a Lead Independent Director role.
• Implemented a whistleblower mechanism (Conduct Hotline).

Climate Goals & Targets

Environmental Challenges

• Difficulty identifying energy and water reduction opportunities that meet financial requirements.
• Challenges in adopting new sustainability technologies while balancing maintainability concerns.
• Need for multi-stakeholder reduction initiatives requiring innovation and cross-sector collaboration.

Mitigation Strategies

• Close collaboration among asset management, engineering teams, vendors, and the sustainability team.
• Leveraging utility-funded auditing and commissioning programs.
• Self-funding attractive energy and water projects.
• Collaboration with tenants on energy and water reduction projects.
• Innovation and cross-sector collaboration with utilities, tenants, and local governments.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Sourcing at least 10% of building materials from recycled sources (goal of 20%).
• Sourcing construction materials within 500 miles of the project site for large projects.

Climate-Related Risks & Opportunities

Physical Risks

• Higher costs for energy and water
• Increased environmental regulation
• Higher costs and more regulation on development activities
• Emphasis on Resilience

Transition Risks

• Changes in building energy consumption patterns
• Utilities changing rate structures to dynamic pricing

Opportunities

• Increased attractiveness of West Coast properties due to fewer extreme weather events.

Reporting Standards

Frameworks Used: GRI G4

Certifications: LEED, ENERGY STAR

Third-party Assurance: DNV GL - Business Assurance, USA & Canada Sustainability

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• White roofs
• LED lighting
• Aqueous ozone cleaning
• Permafrost oil fouling removal technology
• Building IQ software
• SuperTherm ceramic HVAC equipment coating

Awards & Recognition

• GRESB North American Leader, Regional Sector Leader, Green Star
• ENERGY STAR Partner of the Year
• NAREIT Leader in the Light Award
• Institute for Market Transformation Green Lease Leader
• BOMA San Francisco Earth Award
• Southern California Edison Integrated Demand Side Management Award
• Peak Load Management Association Outstanding Demand Response Customer of the Year
• Los Angeles Better Buildings Challenge Energy Innovation Award
• Cool Planet Award
• Commercial Property Executive 30 Greenest Real Estate Companies

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• Reduced energy consumption in office portfolio by 4.9% (exceeding science-based target of 1.8%)
• Achieved 4.4% water savings in office portfolio
• Increased recycling diversion rate from 45.7% to 47.5%
• Increased ENERGY STAR certified portfolio from 65% to 69% (49 buildings)

Social Achievements

• Continued WELL certifications on two additional projects
• Implemented Green Janitor Education Program across 5.1 million sq ft (40% of portfolio)

Governance Achievements

• Participated in GRESB and published annual sustainability report using GRI guidelines
• Participated in at least 10 industry-specific forums annually

Climate Goals & Targets

Environmental Challenges

• Getting water projects to meet financial targets
• Expanding programs to include biodiversity, health, and resilience while maintaining excellence in core programs

Mitigation Strategies

• Actively pursuing aggressive water reduction projects
• Developing strong resilience programs while maintaining excellence in core initiatives

Supply Chain Management

Responsible Procurement

• Use of LEED-compliant cleaning products
• Prohibition of high VOC materials

Climate-Related Risks & Opportunities

Physical Risks

• Higher costs for energy and water
• Increased environmental regulation
• Higher costs and more regulation in supply chain
• Community impacts
• Business impacts

Opportunities

• Increased government incentives for energy and water conservation

Reporting Standards

Frameworks Used: GRI G4 Core Option

Third-party Assurance: DNV GL Business Assurance

Awards & Recognition

• GRESB Green Star Sector Leader & #1 Ranking in North America (2013-2016)
• ENERGY STAR Partner of the Year (2014-2017)
• Sustained Excellence Award (2016, 2017)
• NAREIT Leader in the Light Award (2014-2016)
• IMT Green Lease Leaders awards (2016)
• BOMA International ‘The Office Building of the Year’ (TOBY) award (2016)

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• Reduced energy consumption in office portfolio by 4% (exceeding science-based target of 2%)
• Installed 4 MW of solar across 6 sites
• Reduced water consumption by 0.2% in 2017 (12% total reduction since 2012)
• Increased ENERGY STAR certified portfolio from 69% to 73%
• Completed Fitwel certifications of 10 assets (23% of portfolio)
• Increased recycling diversion rate from 43% to 44%
• Reduced greenhouse gas emissions for the whole portfolio by 8.94%

Social Achievements

• Became the first publicly traded company to align Annual Financial Report with SASB practices
• Launched Kilroy Innovation Lab to formalize implementation of new technologies
• Achieved the world’s first WELL certification for rental units

Governance Achievements

• Added to the Dow Jones Sustainability World Index in 2017

Climate Goals & Targets

Environmental Challenges

• Increasing waste diversion rates despite market obstacles
• Sourcing water projects to meet financial targets
• Further expanding biodiversity, health, and resilience programs while maintaining excellence in core programs

Mitigation Strategies

• Successfully navigated similar concerns in the past
• Confident in continued growth of sustainability programs

Supply Chain Management

Supplier Audits: Preliminary analysis of Tier 1 suppliers in 2017

Responsible Procurement

• Green cleaning program
• Sustainable building materials

Climate-Related Risks & Opportunities

Physical Risks

• Higher costs for energy and water
• Increased environmental regulation
• Higher costs and more regulation in supply chain
• Community impacts
• Business impacts

Transition Risks

• Changes in building energy consumption patterns
• Increased peak demand costs
• Altered rate structures

Opportunities

• Government incentives for energy and water conservation
• Competitive insurance premiums
• Successful development efforts

Reporting Standards

Frameworks Used: GRI G4, SASB

Certifications: LEED, ENERGY STAR, Fitwel, WELL

Third-party Assurance: DNV GL

Sustainable Products & Innovation

• Cross Laminated Timber (CLT)

Awards & Recognition

• ENERGY STAR Partner of the Year
• GRESB Green Star Sector Leader
• NAREIT Leader in the Light Award
• Dow Jones Sustainability World Index Member
• IMT Green Lease Leaders awards
• TOBY Award

Environmental Metrics

ESG Focus Areas

• Climate Change
• Energy Efficiency
• Water Efficiency
• Waste Management
• Supply Chain Management
• Tenant Engagement
• Human Capital Development
• Building Health
• Community Engagement
• Diversity and Inclusion

Environmental Achievements

• Achieved a 2% reduction in energy use across the portfolio.
• Installed over 800 KW of solar across three sites, bringing the total solar portfolio to approximately 4.3 MW.
• Increased the percentage of the portfolio certified under ENERGY STAR from 73% to 77% of eligible square footage.
• Achieved more Fitwel certifications than any non-government landlord, with 15 certifications across 38% of the portfolio.
• Increased the total waste diversion rate from 43% to 44.5%.
• 350 Mission Street achieved TRUE Zero Waste Certification at the Gold level (largest single commercial property in the world to achieve this).

Social Achievements

• Established a Corporate Social Responsibility & Sustainability Committee.
• Created a new employee Corporate Social Responsibility Committee.
• Increased employee training hours (1.4 hours sustainability training and 13.3 hours other training).

Governance Achievements

• Established a Corporate Social Responsibility and Sustainability Committee.
• Became a supporter of the Taskforce on Climate-related Financial Disclosures (TCFD).
• Issued $400 million of green bonds.

Climate Goals & Targets

Environmental Challenges

• Water usage increased for the first time since 2010, despite overall consumption being 6% lower than 2010 levels.
• Need to further expand newer programs such as supply chain excellence and resilience.

Mitigation Strategies

• Focus on initiatives designed to decrease energy and water costs in buildings.
• Demand response and battery storage initiatives to mitigate increased peak demand costs.
• Engineer trainings and tenant engagement to manage water consumption.
• Continued focus on core sustainability programs.

Supply Chain Management

Supplier Audits: Began surveying suppliers on their environmental and social performance in 2018.

Responsible Procurement

• Commitment to recycled, healthy, and regionally-sourced materials.
• Development of a Supplier Social Sustainability Survey.

Climate-Related Risks & Opportunities

Physical Risks

• Higher costs for energy and water
• Increased environmental regulation
• Higher costs and more regulation in the supply chain
• Community impacts
• Business impacts

Transition Risks

• Increased environmental regulation
• Changes in building energy consumption patterns
• Increased government incentives for energy and water conservation

Opportunities

• Government incentives for energy and water conservation
• Competitive insurance premiums
• Successful development efforts and winning more business
• Reputation enhancement

Reporting Standards

Frameworks Used: GRI, SASB, TCFD

Certifications: LEED, ENERGY STAR, Fitwel, TRUE Zero Waste

Third-party Assurance: DNV GL

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• All-electric Core & Shell buildings
• Use of recycled and regionally-sourced materials

Awards & Recognition

• GRESB #1 ranking in North American Listed Office
• NAREIT Leader in the Light award
• NAREIT Most Innovative award
• ENERGY STAR Partner of the Year Sustained Excellence award
• Fitwel 2018 Best in Building Health Award

Environmental Metrics

ESG Focus Areas

• Climate Change
• Environmental Sustainability
• Social Responsibility
• Governance

Environmental Achievements

• Achieved carbon neutral operations for the third consecutive year, including Scope 1, 2, and 3 (downstream leased assets) emissions.
• Reduced Scope 1, 2, and 3 (downstream leased assets) emissions by 27% from a 2017 base year.
• Achieved a 35% waste diversion rate.
• Reduced on-site water use by 16% compared to 2015.

Social Achievements

• 61 promotions awarded, 59% to women.
• 55% female and 42% multicultural workforce.
• Inclusion in the 2022 Bloomberg Gender Equality Index for the fourth consecutive year.
• Engaged in various community service events and philanthropic giving.

Governance Achievements

• Established a Corporate Social Responsibility and Sustainability Committee.
• Included an ESG-focused metric (20% weighting) in the annual cash incentive measurement framework for executive management.

Climate Goals & Targets

Environmental Challenges

• Increased energy and water consumption due to tenants returning to the office.
• Increased waste generation as more tenants returned to buildings.
• Climate-related risks such as wildfire smoke, localized power loss, and potential for social unrest.
• Transition risks such as rising energy costs due to grid decarbonization and potential legislation requiring building retrofits.

Mitigation Strategies

• Implementing energy and water efficiency projects.
• Educating and encouraging tenants to recycle and compost.
• Incorporating climate change risk assessments into due diligence for acquisitions and development projects.
• Developing alternative sourcing strategies for building materials.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Vendor Code of Conduct
• Sustainable Purchasing Policy
• Engagement with Tier 1 suppliers on social and environmental practices.

Climate-Related Risks & Opportunities

Physical Risks

• Wildfire smoke
• Localized power loss
• Flood risk
• Severe weather events
• Extreme temperatures
• Drought

Transition Risks

• Rising energy costs
• Increased capital costs for new technologies
• Potential legislation requiring retrofits
• Carbon pricing

Opportunities

• Increased revenues from EV charging stations
• Reduced energy and water consumption
• Increased tenant demand for sustainable buildings
• Public sector incentives

Reporting Standards

Frameworks Used: GRI, TCFD, SASB

Certifications: LEED, ENERGY STAR, Fitwel, WELL Health-Safety

Third-party Assurance: DNV Business Assurance USA, Inc.

UN Sustainable Development Goals

• Goal 7 (Affordable and Clean Energy)
• Goal 11 (Sustainable Cities and Communities)
• Goal 13 (Climate Action)
• Goal 8 (Decent Work and Economic Growth)
• Goal 3 (Good Health and Well-being)

Kilroy's initiatives contribute to these goals through various environmental, social, and governance programs.

Sustainable Products & Innovation

Not disclosed

Awards & Recognition

• ENERGY STAR Partner of the Year Sustained Excellence Award
• GRESB Regional Sector Leader
• #1 Most Sustainable REIT by Calvert Research & Management
• Fitwel Best in Building Health Award

Environmental Metrics

ESG Focus Areas

• Climate Change
• Environmental
• Social
• Governance

Environmental Achievements

• Maintained carbon neutral operations for the fourth consecutive year.
• Achieved ENERGY STAR certification for 73% of eligible existing office and 82% of eligible residential buildings.
• Kilroy Oyster Point Phase 1 earned LEED Gold certification.

Social Achievements

• Expanded annual 'Week of Service' into 'Month of Service', resulting in over 1000 volunteer hours.
• 43 promotions (approximately 17% of workforce).
• Named to the Bloomberg Gender-Equality Index for the fourth consecutive year.

Governance Achievements

• CSR&S Committee oversees and advances corporate social responsibility and sustainability objectives.
• Issued three green bonds, allocating proceeds to eligible green projects.
• No bribery, fraud, or corruption issues reported.

Climate Goals & Targets

Environmental Challenges

• Increased absolute energy and carbon emissions in 2023 due to portfolio growth, full-year data for recently stabilized properties, growth in life science portfolio, and a cold winter.
• Decreased waste diversion rates.
• Uncertainty around electric grid capacity.

Mitigation Strategies

• Implementing energy analytics software across the portfolio to monitor, manage, and optimize energy consumption.
• Focusing on better building performance data to drive reductions in energy use and carbon emissions.
• Engaging with an external consultant to improve Scope 3 emissions inventory and data strategy.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Preferred Vendor Conduct Policy

Climate-Related Risks & Opportunities

Physical Risks

• Increased frequency and intensity of storms
• Increased costs for proactive physical risk prevention measures
• Flood risk
• Severe weather events
• Increase in extreme temperatures
• Increase in drought exposure risk
• Potential costly damage from coastal urban flooding

Transition Risks

• Enhanced emissions reporting obligations
• Anticipated rising costs for energy
• Project economics impacted by compliance with legislation
• Uncertainty around electric grid capacity
• Increased capital costs around investing in new technologies
• Potential legislation requiring retrofit of mixed-fuel buildings
• Building material costs increase
• Regulation of carbon emissions from buildings

Opportunities

• Increased tenant demand for sustainable buildings
• Reduced energy and water consumption lessens operating costs
• Revenues from installed on-site renewable power and battery storage
• Revenues and carbon credits from EV charging stations
• Our buildings are perceived as more resilient and therefore received increased rents
• Reduced insurance premiums relative to our peers
• Buildings with prestigious sustainability certifications increase in value
• Opportunities to secure public sector incentives
• Opportunities arising from diversification of financial assets

Reporting Standards

Frameworks Used: GRI, TCFD

Certifications: LEED, ENERGY STAR, Fitwel, WELL Health-Safety, BOMA 360

Third-party Assurance: DNV Business Assurance USA, Inc.

UN Sustainable Development Goals

• Not disclosed

Kilroy’s sustainability programs align with the UN SDGs.

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• ENERGY STAR Partner of the Year
• GRESB Regional Sector Leader
• 5 Star Rating (Development)
• 5 Star Rating (Standing Assets)
• NAREIT Leader in the Light Award
• Green Lease Leaders
• Bloomberg Gender-Equality Index Member
• NEWSWEEK America’s Most Responsible Companies
• Best in Building Health Fitwel Excellence Award
• S&P Sustainability Yearbook Member
• Calvert Research & Management’s Top 10 Most Sustainable US REITs