Kilroy Realty: Park Sorrento

Discovered 20% unlevered IRR

Kilroy Realty is a publicly traded (NYSE : KRC) real estate firm committed to taking an integrated approach to acquisitions, financing, property development, construction management, leasing, property operations, and long-term strategic portfolio development.

Additionally, they are an environmental leader in CRE and were looking for a comprehensive way to reduce energy costs, mitigate their environmental impact, and generate an attractive unlevered return. They partnered with Carbon Lighthouse to achieve all three.

Carbon Lighthouse worked on two of Kilroy’s Southern California office buildings, the Park Sorrento complex in Calabasas, CA, a prime location on the doorstep of Los Angeles. The two buildings, totaling 204,500 square feet, are full service gross and were built in 2000.

204,500 sq ft

Zero Project Investment

$222,500 Lifetime Savings

Find out how much ROI we can produce.

Financials

The Carbon Lighthouse team identified and delivered a project that if paid for up-front would have generated a 20% unlevered IRR for the Park Sorrento portfolio. Carbon Lighthouse made it possible for Kilroy to pay for the energy savings over time, so that there were no upfront costs and an infinite return. The first year savings were $14,700 and Kilroy will benefit from lifetime savings of $222,500. Additionally, the project will reduce their carbon footprint by 33 tons per year, the equivalent of planting 761 trees.

“The Carbon Lighthouse team is highly competent and professional, and my engineers reported that they really liked working with the CL team.”

Kilroy Realty

Sara Neff, VP of Sustainability

The Nuts & Bolts: Our Process

Our engineers spent several days on site learning about the complex interrelations among the building HVAC systems before systematically deploying sensors. These sensors gathered millions of data points that went beyond the reach of the buildings’ existing Building Management Systems (BMS). By capturing this unique level of granularity, our data revealed big opportunities. Adjustments were made to the air handler controls in the building that not only saved energy, but also ensured air would be provided at ideal volumes and temperatures to maintain a high level of comfort for occupants. Our data also discovered that the boiler was producing heating water when the temperature outside was hot and the building was not calling for heat. We eliminated this excess heating, resulting in significant annual savings and increasing equipment life.

The Carbon Lighthouse team delivered a project that had meaningful impact to Kilroy’s corporate goals. In addition to a great financial return, the projects also result in better performing, more durable assets. Improved building efficiency, extended lifetimes for the building’s capital equipment, increased building NOI, and provided Kilroy a leasing edge in a competitive market.

The replacement of water sourced heat pumps with fan coil units due to the savings shown by logger data. Modifications to the differential pressure set points and valve positions in the system. Optimization of fan control and economization in Air Handler Units.

A full lighting analysis led to LED upgrades in the garages and stairwells. Vending machine motion sensors were employed as not only an energy efficiency measure but as a visible symbol of the building’s commitment to sustainability as well.

With specific aim to improve guest experience, the Carbon Lighthouse team analyzed the existing but under-utilized room automation system while also improving energy efficiency. This resulted in prepping rooms to a comfortable temperature as guests were checking in, turning off equipment when rooms were unoccupied, and enabling the TV to turn on when guests entered the residence.

ClientKilroy Realty
ProjectKilroy Realty: Park Sorrento
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