Physical layer key generation (PLKG) can significantly enhance the security of classic encryption schemes by enabling them to change their secret keys significantly faster and more efficient. However, due to the reliance of PLKG techniques on channel medium, reaching a high secret key rate is challenging in static environments. Recently, exploiting intelligent reflecting surface (IRS) as a means to induce randomness in static wireless channels has received significant research interest. However, the impact of spatial correlation between the IRS elements is rarely studied. To be specific, for the first time, in this contribution, we take into account a spatially correlated IRS which intends to enhance the secret key generation (SKG) rate in a static medium. Closed form analytical expressions for SKG rate are derived for the two cases of random phase shift and equal random phase shift for all the IRS elements. We also analyze the temporal correlation between the channel samples to ensure the randomness of the generated secret key sequence. We further formulate an optimization problem in which we determine the optimal portion of time within a coherence interval dedicated for the direct and indirect channel estimation. We show the accuracy and the fast convergence of our proposed sequential convex programming (SCP) based algorithm and discuss the various parameters affecting spatially correlated IRS assisted PLKG.