EX-99.2 3 dex992.htm SUPPLEMENTAL OPERATING AND FINANCIAL DATA POSTED FEBRUARY 26, 2008 Supplemental Operating and Financial Data posted February 26, 2008

Exhibit 99.2

LOGO

DIGITAL REALTY TRUST

Fourth Quarter 2007

Supplemental Operating and Financial Data

December 31, 2007

This Supplemental Operating and Financial Data package is not an offer to sell or solicitation to buy securities of Digital Realty Trust, Inc. Any offers to sell or solicitations to buy securities of Digital Realty Trust, Inc. shall be made only by means of a prospectus approved for that purpose.


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

 

          PAGE

Corporate Data

  
  

Corporate Information

   4
  

Ownership Structure

   5

Consolidated Financial Information

  
  

Key Financial Data

   6
  

Consolidated Balance Sheets

   7
  

Consolidated Quarterly Statements of Operations

   8
  

Funds From Operations and Adjusted Funds From Operations

   9
  

Reconciliation of Earnings Before Interest, Taxes and Depreciation and Amortization and Financial Ratios

   10
  

Net Operating Income (NOI) and Run-rate NOI for the three months ended December 31, 2007

   11
  

Same Store and New Properties Consolidated Quarterly Statements of Operations

   12
  

Same Store Operating Trend Summary

   13
  

Consolidated Debt Analysis

   14
  

Debt Maturities

   15

Portfolio Data

  
  

Portfolio Summary

   16
  

Properties Acquired

   17
  

Occupancy Analysis

   18
  

Major Tenants

   20
  

Utility Power Capacity

   21
  

Lease Expirations & Lease Distribution

   22
  

Leasing Activity

   23
  

Tenant Improvements and Leasing Commissions

   24
  

Historical Capital Expenditures

   25
  

Redevelopment Activity

   26

Definitions

  
  

Management Statements on Non-GAAP Supplemental Measures

   27

 

Page 2


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

Statement Regarding Forward-Looking Statements

This supplemental package contains forward-looking statements within the meaning of the federal securities laws, including information related to run rate net operating income. Such statements are based on management’s beliefs and assumptions made based on information currently available to management. Such statements are subject to risks, uncertainties and assumptions and are not guarantees of future performance and may be affected by known and unknown risks, trends, uncertainties and factors that are beyond our control. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or projected. Some of the risks and uncertainties that may cause our actual results, performance or achievements to differ materially from those expressed or implied by forward-looking statements include, among others, the following:

 

   

adverse economic or real estate developments in our markets or the technology industry;

 

   

our dependence upon significant tenants;

 

   

bankruptcy or insolvency of a major tenant;

 

   

downturn of local economic conditions in our geographic markets;

 

   

our inability to comply with the rules and regulations applicable to public companies or to manage our growth effectively;

 

   

difficulty acquiring or operating properties in foreign jurisdictions;

 

   

defaults on or non-renewal of leases by tenants;

 

   

increased interest rates and operating costs;

 

   

our failure to obtain necessary outside financing;

 

   

restrictions on our ability to engage in certain business activities;

 

   

risks related to joint venture investments;

 

   

decreased rental rates or increased vacancy rates;

 

   

inability to successfully develop and lease new properties and space held for redevelopment;

 

   

difficulties in identifying properties to acquire and completing acquisitions;

 

   

increased competition or available supply of data center space;

 

   

our failure to successfully operate acquired properties;

 

   

our inability to acquire off-market property;

 

   

delays or unexpected costs in development or redevelopment of properties;

 

   

our failure to maintain our status as a REIT;

 

   

possible adverse changes to tax laws;

 

   

environmental uncertainties and risks related to natural disasters;

 

   

financial market fluctuations;

 

   

changes in foreign currency exchange rates;

 

   

changes in foreign laws and regulations, including those related to taxation and real estate ownership and operation; and

 

   

changes in real estate and zoning laws and increases in real property tax rates.

The risks included here are not exhaustive, and additional factors could adversely affect our business and financial performance. We discussed a number of additional material risks in our annual reports on Form 10-K for the year ended December 31, 2006, our quarterly report on Form 10-Q for the quarters ended March 31, 2007, June 30, 2007 and September 30, 2007, and other filings with the Securities and Exchange Commission. Those risks continue to be relevant to our performance and financial condition. Moreover, we operate in a very competitive and rapidly changing environment. New risk factors emerge from time to time and it is not possible for management to predict all such risk factors, nor can it assess the impact of all such risk factors on the business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. We expressly disclaim any responsibility to update forward-looking statements, whether as a result of new information, future events or otherwise.

 

Page 3


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

Corporate Information

Corporate Profile

Digital Realty Trust, Inc. owns, acquires, develops, redevelops and manages technology-related real estate. The Company’s 70 properties, excluding one property held as an investment in an unconsolidated joint venture, contain applications and operations critical to the day-to-day operations of technology industry tenants and corporate enterprise data center tenants. Comprising approximately 12.3 million net rentable square feet, including approximately 1.8 million square feet of space held for redevelopment, Digital Realty Trust’s property portfolio is located in 26 markets throughout North America and Europe. For additional information, please visit the company’s website at www.digitalrealtytrust.com.

Corporate Headquarters

560 Mission Street, Suite 2900

San Francisco, California 94105

Telephone: (415) 738-6500

Facsimile: (415) 738-6501

Web site: www.digitalrealtytrust.com

Senior Management

Richard A. Magnuson: Chairman

Michael F. Foust: Chief Executive Officer

A. William Stein: Chief Financial Officer and Chief Investment Officer

Scott E. Peterson: Senior Vice President, Acquisitions

Christopher J. Crosby: Senior Vice President, Sales and Technical Services

James R. Trout: Senior Vice President of Portfolio and Technical Operations

Investor Relations

To request an Investor Relations package or be added to our e-mail distribution list, please visit our website:

www.digitalrealtytrust.com                                 (Proceed to Information Request in the Investor Relations section)

 

Analyst Coverage         

Credit Suisse

   Merrill Lynch    KeyBanc Capital Markets    Raymond James

Steve Benyik

   Steve Sakwa    Jordan Sadler    Paul D. Puryear

(212) 538-0239

   (212) 449-0335    (917) 368-2280    (727) 567-2253

Michael Gorman

   Ian Weissman      

(212) 538-4357

   (212) 449-6255      

JMP Securities

   RBC Capital Markets    Citigroup    UBS Securities

William Marks

   Dave Rodgers    Jonathan Litt    Omotayo Okusanya

(415) 835-8944

   (216) 378-7626    (212) 816-0231    (212) 713-7864
      Michael Bilerman    Heath Binder
      (212) 816-1685    (212) 713-3226

Stock Listing Information

The stock of Digital Realty Trust, Inc. is traded primarily on the New York Stock Exchange under the following symbols:

 

Common Stock:

   DLR

Series A Preferred Stock:

   DLRPA

Series B Preferred Stock:

   DLRPB

Note that symbols may vary by stock quote provider.

Common Stock Price Performance

The following summarizes recent activity of Digital Realty’s common stock (DLR):

 

     4th Quarter
2007
    3rd Quarter
2007
    2nd Quarter
2007
    1st Quarter
2007
    4th Quarter
2006
    3rd Quarter
2006
    2nd Quarter
2006
    1st Quarter
2006
 

High Price *

   $ 44.21     $ 40.62     $ 42.86     $ 40.42     $ 37.31     $ 31.88     $ 29.54     $ 28.59  

Low Price *

   $ 35.05     $ 32.04     $ 36.70     $ 33.76     $ 30.73     $ 24.58     $ 22.66     $ 22.29  

Closing Price, end of quarter *

   $ 38.37     $ 39.39     $ 37.68     $ 39.90     $ 34.23     $ 31.32     $ 24.69     $ 28.17  

Average daily trading volume *

     813,553       730,532       799,130       495,630       321,710       365,056       224,662       194,179  

Indicated dividend per common share **

   $ 1.240     $ 1.145     $ 1.145     $ 1.145     $ 1.145     $ 1.06     $ 1.06     $ 1.06  

Closing annual dividend yield, end of quarter

     3.2 %     2.9 %     3.0 %     2.9 %     3.3 %     3.4 %     4.3 %     3.8 %

Closing shares and units outstanding end of quarter ***

     72,082,034       68,003,179       67,984,292       67,924,536       67,913,155       63,110,530       63,052,653       59,052,653  

Closing market value of shares and units outstanding (thousands), end of quarter

   $ 2,765,788     $ 2,678,645     $ 2,561,648     $ 2,710,189     $ 2,324,667     $ 1,976,622     $ 1,556,770     $ 1,663,513  

 

* New York Stock Exchange trades only
** On an annual basis
*** The total number of shares and units includes 65,406,240 shares of common stock, 5,290,070 common units and 1,385,724 vested and unvested long-term incentive units, and excludes Class C units and shares issuable upon the redemption of profits interest units and Class C units, which have not vested, and all unexercised common stock options.

This Supplemental Operating and Financial Data package supplements the information provided in our quarterly and annual reports filed with the Securities and Exchange Commission. Additional information about us and our properties is also available at our website www.digitalrealtytrust.com.

 

Page 4


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

Ownership Structure

As of December 31, 2007

LOGO

 

Partner

   # of Units (2)    % Ownership  

Digital Realty Trust, Inc.

   65,406,240    90.7 %

Cambay Tele.com, LLC (3)

   5,257,348    7.4 %

Wave Exchange, LLC (3)

   32,722    0.0 %

Directors, Executive Officers and Others

   1,385,724    1.9 %
           

Total

   72,082,034    100.0 %
           

 

(1) Reflects limited partnership interests held by our officers and directors in the form of vested and unvested long-term incentive units and excludes shares issuable upon the redemption of Class C units which have not yet vested and all unexercised common stock options.
(2) The total number of units includes 65,406,240 shares of common stock, 5,290,070 common units and 1,385,724 vested and unvested long-term incentive units and excludes Class C units and shares issuable upon the redemption of profits interest units and Class C units, which have not yet vested, and all unexercised common stock options.
(3) These third-party contributors received the units (along with cash and the operating partnership assuming debt) in exchange for their interests in 200 Paul Avenue 1-4, 1100 Space Park Drive, the eXchange colocation business and other specified assets and liabilities. Includes 629,913 common units held by the members of Cambay Tele.com, LLC.

 

Page 5


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

Key Quarterly Financial Data

(Unaudited and dollars in thousands, except per share data)

 

      For the three months ended or as of  
     31-Dec-07     30-Sep-07     30-Jun-07     31-Mar-07     31-Dec-06     30-Sep-06     30-Jun-06     31-Mar-06  

Shares and units at end of quarter

                

Common shares outstanding

     65,406,240       60,721,750       60,713,878       60,692,858       54,257,691       36,155,367       36,104,961       31,429,296  

Common units outstanding

     6,675,794       7,281,429       7,270,414       7,231,678       13,655,464       26,955,163       26,947,692       27,623,357  
                                                                

Total shares and Operating Partnership units

     72,082,034       68,003,179       67,984,292       67,924,536       67,913,155       63,110,530       63,052,653       59,052,653  
                                                                

Market Capitalization

                

Market value of common equity (1)

   $ 2,765,788     $ 2,678,645     $ 2,561,648     $ 2,710,189     $ 2,324,667     $ 1,976,622     $ 1,556,770     $ 1,663,513  

Stated value of preferred equity

     341,750       341,750       341,750       166,750       166,750       166,750       166,750       166,750  

Total debt at balance sheet carrying value (2)

     1,367,738       1,335,108       1,172,307       1,271,988       1,122,638       1,074,757       820,501       813,655  
                                                                

Total market capitalization including preferred equity and debt (2)

   $ 4,475,276     $ 4,355,503     $ 4,075,705     $ 4,148,927     $ 3,614,055     $ 3,218,129     $ 2,544,021     $ 2,643,918  
                                                                

Total debt/Total market capitalization including preferred equity and debt

     30.6 %     30.7 %     28.8 %     30.7 %     31.1 %     33.4 %     32.3 %     30.8 %

Selected Balance Sheet Data

                

Investments in real estate (before depreciation) (3)

     2,489,793       2,231,886       2,044,661       1,967,653       1,849,281       1,626,979       1,399,752       1,289,226  

Total assets

     2,809,464       2,576,119       2,393,476       2,333,791       2,186,219       1,971,762       1,713,857       1,574,041  

Total liabilities

     1,687,637       1,580,786       1,384,223       1,481,575       1,338,031       1,247,351       990,422       935,039  

Selected Operating Data

                

Total operating revenues from continuing operations (4)

     105,903       104,794       95,583       88,967       82,045       70,673       62,237       57,121  

Total operating expenses from continuing operations (4)

     84,945       83,369       73,042       67,002       61,101       52,222       44,452       39,733  

Interest expense from continuing operations (4)

     15,863       16,683       15,264       16,594       14,102       13,792       11,249       10,452  

Net income

     5,613       5,135       7,758       22,086       6,423       14,787       5,095       5,087  

Net income (loss) available to common stockholders

     254       (224 )     2,591       18,641       2,978       11,342       1,650       1,642  

Financial Ratios

                

EBITDA (5)

     53,935       51,804       49,565       65,742       45,721       50,613       34,106       31,286  

Adjusted EBITDA (6)

     59,322       57,136       55,042       72,949       50,429       62,520       38,891       36,562  

Cash interest expense (7)

     17,323       19,464       14,359       17,882       12,477       12,860       13,296       10,244  

Fixed charges (8)

     24,839       26,679       21,261       22,967       17,540       17,820       17,863       15,113  

Debt service coverage ratio (9)

     3.4x       2.9x       3.8x       4.1x       4.0x       4.9x       2.9x       3.6x  

Fixed charge coverage ratio (10)

     2.4x       2.1x       2.6x       3.2x       2.9x       3.5x       2.2x       2.4x  

Profitability measures

                

Net income (loss) per common share - basic

   $ —       $ —       $ 0.04     $ 0.33     $ 0.06     $ 0.31     $ 0.05     $ 0.06  

Net income (loss) per common share - diluted

   $ —       $ —       $ 0.04     $ 0.32     $ 0.06     $ 0.30     $ 0.05     $ 0.06  

Diluted Funds From Operations (FFO) per share and unit (11)

   $ 0.53     $ 0.51     $ 0.51     $ 0.50     $ 0.48     $ 0.41     $ 0.38     $ 0.36  

Diluted Adjusted Funds From Operations (AFFO) per share and unit (12)

   $ 0.37     $ 0.35     $ 0.37     $ 0.41     $ 0.29     $ 0.30     $ 0.27     $ 0.28  

Dividends per share and common unit

   $ 0.31     $ 0.29     $ 0.29     $ 0.29     $ 0.29     $ 0.27     $ 0.27     $ 0.27  

Diluted FFO payout ratio (13)

     58.5 %     55.7 %     56.4 %     57.3 %     59.6 %     65.9 %     71.1 %     75.0 %

Diluted AFFO payout ratio (14)

     83.8 %     81.8 %     77.4 %     69.8 %     98.7 %     90.0 %     100.0 %     96.4 %

Portfolio Statistics (15)

                

Buildings

     93       88       83       83       79       71       66       55  

Properties

     70       67       62       61       59       53       49       45  

Net rentable square feet, excluding redevelopment space

     10,527,011       10,311,857       9,713,146       9,668,267       9,381,860       9,111,904       8,766,173       7,769,773  

Square feet held for redevelopment (16)

     1,754,228       1,708,059       1,659,133       1,710,199       1,646,255       1,248,326       1,156,437       1,196,538  

Occupancy at end of quarter (17)

     94.7 %     95.1 %     94.6 %     94.8 %     95.0 %     94.7 %     94.4 %     92.7 %

Weighted average remaining lease term (years) (18)

     7.7       7.5       7.5       7.0       6.9       7.2       7.0       7.4  

Same store occupancy at end of quarter (19)

     93.9 %     94.4 %     93.9 %     94.4 %     94.9 %     93.9 %     94.4 %     93.7 %

 

(1) The market value of common equity is based on the closing stock price at the end of the quarter and assumes 100% redemption of the limited partnership units in the operating partnership, including vested and unvested long-term incentive units, for shares of our common stock. Excludes shares issuable with respect to stock options that have been granted but have not yet been exercised, and also excludes shares issuable upon the redemption of long-term incentive units and Class C units which have not yet vested and shares of our common stock issuable upon redemption thereof.
(2) The amount for June 30, 2006 excludes the outstanding principal for a loan related to 7979 East Tufts Avenue of $26.0 million. We classified this property as held for sale at June 30, 2006. We completed its sale on July 12, 2006 and eliminated our liability for the $26.0 million loan.
(3) The June 30, 2006 amount excludes assets held for sale at East Tufts Avenue of $37.9 million.
(4) Excludes operations for properties sold in 2007 and 2006: 100 Technology Center Drive (March 2007), 4055 Valley View Lane (March 2007) and 7979 East Tufts Avenue (July 2006), for all periods presented.
(5) EBITDA is calculated as earnings before interest, taxes, depreciation and amortization. For a discussion of EBITDA, see page 27. For a reconciliation of net income available to common stockholders to EBITDA, see page 10.
(6) Adjusted EBITDA is EBITDA adjusted for preferred dividends and minority interests. For a discussion of Adjusted EBITDA, see page 27. For a reconciliation of net income available to common stockholders to Adjusted EBITDA, see page 10.
(7) Cash interest expense is interest expense per our statement of operations (including interest expense on discontinued operations) adjusted for noncash interest expense and includes capitalized interest. For a reconciliation of GAAP interest expense to cash interest expense see page 10.
(8) Fixed charges consist of cash interest expense, scheduled debt principal payments and preferred dividends.
(9) Debt service coverage ratio is Adjusted EBITDA divided by cash interest expense. Ignoring the effect of the gain on sale for 100 Technology Center Drive and 4055 Valley View Lane, debt service coverage ratio was 3.1x for the three months ended March 31, 2007. Ignoring the effect of the gain on sale of 7979 East Tufts Avenue, debt service coverage ratio was 3.5x for the three months ended September 30, 2006.
(10) Fixed charge coverage ratio is Adjusted EBITDA divided by fixed charges. Ignoring the effect of the gain on sale for 100 Technology Center Drive and 4055 Valley View Lane, fixed charge coverage ratio was 2.4x for the three months ended March 31, 2007. Ignoring the effect of the gain on sale of 7979 East Tufts Avenue, fixed charge coverage ratio was 2.5x for the three months ended September 30, 2006.
(11) For a definition and discussion of FFO see page 27. For a reconciliation of net income available to common stockholders to FFO, see page 9.
(12) For a definition and discussion of AFFO, see page 27. For a reconciliation of FFO to AFFO, see page 9.
(13) Diluted FFO payout ratio is dividend declared per common share and unit divided by diluted FFO per share and unit.
(14) Diluted AFFO payout ratio is dividend declared per common share and unit divided by diluted AFFO per share and unit.
(15) Portfolio statistics exclude operations for properties sold in 2007 and 2006; 100 Technology Center Drive (March 2007), 4055 Valley View Lane (March 2007) and 7979 East Tufts Avenue (July 2006), for all periods presented.
(16) Redevelopment space requires significant capital investment in order to develop data center facilities that are ready for use. Most often this is shell space. However, in certain circumstances this may include partially built datacenter space that was not completed by previous ownership and requires a large capital investment in order to build out the space.
(17) Occupancy and same store occupancy excludes space held for redevelopment.
(18) Average remaining lease term excludes renewal options, weighted by net rentable square feet.
(19) Same store properties were acquired before December 31, 2005. Same store occupancy statistics exclude properties sold in 2007 and 2006: 100 Technology Center Drive (March 2007), 4055 Valley View Lane (March 2007) and 7979 East Tufts Avenue (July 2006), for all periods presented.

 

Page 6


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

Consolidated Balance Sheets

(Dollars in thousands, except share data)

 

     December 31, 2007     December 31, 2006  
     (unaudited)        

ASSETS

    

Investments in real estate

    

Land

   $ 316,196     $ 228,728  

Acquired ground leases

     2,790       3,028  

Buildings and improvements

     1,968,850       1,415,236  

Tenant improvements

     193,436       172,334  
                

Investments in real estate

     2,481,272       1,819,326  

Accumulated depreciation and amortization

     (188,099 )     (112,479 )
                

Net investments in properties

     2,293,173       1,706,847  

Investment in unconsolidated joint venture

     8,521       29,955  
                

Net investments in real estate

     2,301,694       1,736,802  

Cash and cash equivalents

     31,352       22,261  

Accounts and other receivables, net

     43,440       31,293  

Deferred rent

     64,639       40,225  

Acquired above market leases, net

     38,762       47,292  

Acquired in place lease value and deferred leasing costs, net

     253,642       248,751  

Deferred financing costs, net

     17,610       17,500  

Restricted cash

     41,302       28,144  

Other assets

     17,023       13,951  
                

Total Assets

   $ 2,809,464     $ 2,186,219  
                

LIABILITIES AND STOCKHOLDERS’ EQUITY

    

Unsecured revolving credit facility

   $ 299,731     $ 145,452  

Mortgage loans

     895,507       804,686  

Exchangeable senior debentures

     172,500       172,500  

Accounts payable and other accrued liabilities

     176,143       88,698  

Accrued dividends and distributions

     22,345       19,386  

Acquired below market leases, net

     93,572       87,487  

Security deposits and prepaid rents

     27,839       19,822  
                

Total Liabilities

     1,687,637       1,338,031  
                

Commitments and contingencies

     —         —    

Minority interests in consolidated joint venture

     4,928       —    

Minority interests in operating partnership

     72,983       138,416  

Stockholders’ equity:

    

Preferred Stock: $0.01 par value, 30,000,000 authorized:

    

Series A Cumulative Redeemable Preferred Stock, 8.50%, $103,500,000 liquidation preference ($25.00 per share), 4,140,000 issued and outstanding

     99,297       99,297  

Series B Cumulative Redeemable Preferred Stock, 7.875%, $63,250,000 liquidation preference ($25.00 per share), 2,530,000 issued and outstanding

     60,502       60,502  

Series C Cumulative Convertible Preferred Stock, 4.375%, $175,000,000 liquidation preference ($25.00 per share), 7,000,000 issued and outstanding

     169,068       —    

Common Stock; $0.01 par value: 125,000,000 authorized, 65,406,240 and 54,257,691 shares issued and outstanding as of December 31, 2007 and 2006, respectively

     654       542  

Additional paid-in capital

     814,106       597,334  

Dividends in excess of earnings

     (103,090 )     (52,093 )

Accumulated other comprehensive income, net

     3,379       4,190  
                

Total Stockholders’ Equity

     1,043,916       709,772  
                

Total Liabilities and Stockholders’ Equity

   $ 2,809,464     $ 2,186,219  
                

 

Page 7


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

Consolidated Quarterly Statements of Operations

(unaudited and in thousands, except share data)

 

    Three Months Ended  
    31-Dec-07     30-Sep-07     30-Jun-07     31-Mar-07     31-Dec-06     30-Sep-06     30-Jun-06     31-Mar-06  

Rental

  $ 85,074     $ 82,536     $ 78,705     $ 73,288     $ 68,327     $ 57,394     $ 49,900     $ 45,750  

Tenant reimbursements

    20,589       22,104       16,631       15,679       13,521       13,279       12,337       11,203  

Other

    240       154       247       —         197       —         —         168  
                                                               

Total operating revenues

    105,903       104,794       95,583       88,967       82,045       70,673       62,237       57,121  
                                                               

Rental property operating and maintenance

    33,101       30,539       23,865       21,239       19,764       14,972       13,205       11,314  

Property taxes

    4,440       7,859       7,342       7,540       6,512       6,956       6,839       6,583  

Insurance

    1,326       1,356       1,419       1,426       826       934       1,050       872  

Depreciation and amortization

    37,818       35,345       31,832       29,399       27,291       23,767       18,534       16,537  

General and administrative

    8,159       7,775       8,456       7,210       6,535       4,986       4,674       4,246  

Other

    101       495       128       188       173       607       150       181  
                                                               

Total operating expenses

    84,945       83,369       73,042       67,002       61,101       52,222       44,452       39,733  
                                                               

Operating income

    20,958       21,425       22,541       21,965       20,944       18,451       17,785       17,388  

Equity in earnings of unconsolidated joint venture

    (75 )     (237 )     216       545       177       —         —         —    

Interest and other income

    621       621       532       513       416       364       262       228  

Interest expense

    (15,863 )     (16,683 )     (15,264 )     (16,594 )     (14,102 )     (13,792 )     (11,249 )     (10,452 )

Loss from early extinguishment of debt

    —         —         —         —         (5 )     (40 )     (425 )     (57 )
                                                               

Income from continuing operations before minority interests

    5,641       5,126       8,025       6,429       7,430       4,983       6,373       7,107  

Minority interests in continuing operations of operating partnership

    (28 )     25       (305 )     (501 )     (1,205 )     (657 )     (1,312 )     (1,939 )
                                                               

Income from continuing operations

    5,613       5,151       7,720       5,928       6,225       4,326       5,061       5,168  

Income (loss) from discontinued operations before gain on sale of assets and minority interests

    —         (18 )     43       1,370       176       250       62       (174 )

Gain on sale of assets

    —         —         —         18,049       80       18,016       —         —    

Minority interests attributable to discontinued operations

    —         2       (5 )     (3,261 )     (58 )     (7,805 )     (28 )     93  
                                                               

Income (loss) from discontinued operations (1)

    —         (16 )     38       16,158       198       10,461       34       (81 )
                                                               

Net income

    5,613       5,135       7,758       22,086       6,423       14,787       5,095       5,087  

Preferred stock dividends

    (5,359 )     (5,359 )     (5,167 )     (3,445 )     (3,445 )     (3,445 )     (3,445 )     (3,445 )
                                                               

Net income (loss) available to common stockholders

  $ 254     $ (224 )   $ 2,591     $ 18,641     $ 2,978     $ 11,342     $ 1,650     $ 1,642  
                                                               

Net income (loss) per share available to common stockholders - basic

  $ —       $ —       $ 0.04     $ 0.33     $ 0.06     $ 0.31     $ 0.05     $ 0.06  

Net income (loss) per share available to common stockholders - diluted

  $ —       $ —       $ 0.04     $ 0.32     $ 0.06     $ 0.30     $ 0.05     $ 0.06  

Weighted-average shares outstanding - basic

    64,098,942       60,717,153       60,697,740       56,511,200       47,332,515       36,114,253       33,372,240       27,503,248  

Weighted-average shares outstanding - diluted

    66,288,996       60,717,153       62,970,291       58,424,427       48,940,617       37,446,893       33,872,344       28,354,597  

Weighted-average fully diluted shares and units

    73,310,168       69,937,352       70,228,894       69,830,614       69,213,230       64,397,265       60,959,350       59,873,798  

 

(1) During 2007 and 2006, we sold 7979 East Tufts Avenue (July 2006), 100 Technology Center Drive (March 2007) and 4055 Valley View Lane (March 2007). We have presented all activity for these properties in Income (loss) from discontinued operations for all periods presented above. This will cause individual line items above to differ from previously published information but does not affect net income available to common stockholders.

 

Page 8


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

Funds From Operations (FFO)

(unaudited and in thousands except per share data)

 

     Three Months Ended  
     31-Dec-07     30-Sep-07     30-Jun-07     31-Mar-07     31-Dec-06     30-Sep-06     30-Jun-06     31-Mar-06  

Reconciliation of net income available to common stockholders to FFO (Note):

                

Net income available to common stockholders

   $ 254     $ (224 )   $ 2,591     $ 18,641     $ 2,978     $ 11,342     $ 1,650     $ 1,642  

Adjustments:

                

Minority interests in operating partnership including discontinued operations

     28       (27 )     310       3,762       1,263       8,462       1,340       1,846  

Real estate related depreciation and amortization (1)

     37,673       35,216       31,708       29,643       28,056       24,453       20,238       18,185  

Real estate related depreciation and amortization related to investment in unconsolidated joint venture

     919       969       1,010       1,036       796       —         —         —    

Gain on sale of assets

     —         —         —         (18,049 )     (80 )     (18,016 )     —         —    
                                                                

FFO available to common stockholders and unitholders

   $ 38,874     $ 35,934     $ 35,619     $ 35,033     $ 33,013     $ 26,241     $ 23,228     $ 21,673  
                                                                

FFO per share:

                

Basic

   $ 0.55     $ 0.53     $ 0.52     $ 0.52     $ 0.49     $ 0.42     $ 0.38     $ 0.37  

Diluted

   $ 0.53     $ 0.51     $ 0.51     $ 0.50     $ 0.48     $ 0.41     $ 0.38     $ 0.36  
                                                                

Weighted-average shares outstanding - basic

     71,120       67,995       67,956       67,917       67,605       63,065       60,459       59,022  

Weighted-average shares outstanding - diluted

     73,310       69,937       70,229       69,831       69,213       64,397       60,959       59,874  

(1) Real estate depreciation and amortization was computed as follows:

                

Depreciation and amortization per income statement

   $ 37,818     $ 35,345     $ 31,832     $ 29,399     $ 27,291     $ 23,767     $ 18,534     $ 16,537  

Depreciation and amortization of discontinued operations

     —         —         —         379       883       971       1,741       1,719  

Non real estate depreciation

     (145 )     (129 )     (124 )     (135 )     (118 )     (285 )     (37 )     (71 )
                                                                
   $ 37,673     $ 35,216     $ 31,708     $ 29,643     $ 28,056     $ 24,453     $ 20,238     $ 18,185  
                                                                

 

Note: For a definition and discussion of FFO, see page 27. FFO for all periods presented above includes the results of properties sold in 2006 and 2007: 7979 East Tufts Avenue (July 2006), 100 Technology Center Drive (March 2007) and 4055 Valley View Lane (March 2007).

Adjusted Funds From Operations (AFFO)

(unaudited and in thousands)

 

     Three Months Ended  
     31-Dec-07     30-Sep-07     30-Jun-07     31-Mar-07     31-Dec-06     30-Sep-06     30-Jun-06     31-Mar-06  

Reconciliation of FFO to AFFO:

                

Funds from operations available to common stockholders and unitholders (FFO)

   $ 38,874     $ 35,934     $ 35,619     $ 35,033     $ 33,013     $ 26,241     $ 23,228     $ 21,673  

Adjustments:

                

Non real estate depreciation

     145       129       124       135       118       285       37       71  

Amortization of deferred financing costs

     1,149       1,682       1,321       1,389       1,115       916       937       795  

Non cash compensation

     1,134       1,103       836       507       491       430       435       431  

Loss from early extinguishment of debt

     —         —         —         —         6       40       425       57  

Straight line rents

     (7,303 )     (7,204 )     (5,770 )     (5,111 )     (5,810 )     (3,856 )     (4,233 )     (3,843 )

Above and below market rent amortization

     (2,617 )     (2,691 )     (2,578 )     (2,338 )     (2,238 )     (2,837 )     (1,504 )     (433 )

Capitalized leasing compensation

     (416 )     (300 )     (175 )     (175 )     (217 )     (185 )     (888 )     (764 )

Recurring capital expenditures and tenant improvements

     (1,200 )     (2,765 )     99       (393 )     (2,574 )     (344 )     (338 )     (904 )

Capitalized leasing commissions

     (2,705 )     (1,389 )     (3,836 )     (439 )     (3,716 )     (1,523 )     (1,682 )     (265 )
                                                                

AFFO available to common stockholders and unitholders

   $ 27,061     $ 24,499     $ 25,640     $ 28,608     $ 20,188     $ 19,167     $ 16,417     $ 16,818  
                                                                

 

Note: For a definition and discussion of AFFO, see page 27. For a reconciliation of net income available to common stockholders to FFO, see above table. AFFO for all periods presented above includes the results of properties sold in 2006 and 2007: 7979 East Tufts Avenue (July 2006), 100 Technology Center Drive (March 2007) and 4055 Valley View Lane (March 2007).

 

Page 9


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

Reconciliation of Earnings before interest, taxes, depreciation and amortization (EBITDA) (1)

(unaudited and in thousands)

 

     Three Months Ended
     31-Dec-07    30-Sep-07     30-Jun-07    31-Mar-07    31-Dec-06    30-Sep-06    30-Jun-06    31-Mar-06

Net income (loss) available to common stockholders

   $ 254    $ (224 )   $ 2,591    $ 18,641    $ 2,978    $ 11,342    $ 1,650    $ 1,642

Interest (including discontinued operations)

     15,863      16,683       15,142      17,323      14,569      14,533      12,181      11,388

Depreciation and amortization

     37,818      35,345       31,832      29,778      28,174      24,738      20,275      18,256
                                                        

EBITDA

     53,935      51,804       49,565      65,742      45,721      50,613      34,106      31,286

Minority interests

     28      (27 )     310      3,762      1,263      8,462      1,340      1,831

Preferred stock dividends

     5,359      5,359       5,167      3,445      3,445      3,445      3,445      3,445
                                                        

Adjusted EBITDA

   $ 59,322    $ 57,136     $ 55,042    $ 72,949    $ 50,429    $ 62,520    $ 38,891    $ 36,562
                                                        

 

(1) For the definition and discussion of EBITDA and Adjusted EBITDA, see page 27. EBITDA and adjusted EBITDA for the three months ended March 31, 2007 include a gain on sale for 100 Technology Center Drive and 4055 Valley View Lane of approximately $18.0 million. Excluding this gain EBITDA and Adjusted EBITDA would have been $50.7 million and $54.9 million, respectively for three months ended March 31, 2007. EBITDA and adjusted EBITDA for the three months ended September 30, 2006 include a gain on sale for 7979 East Tufts Avenue of $18.0 million. Excluding this gain EBITDA and Adjusted EBITDA would have been $40.3 million and $44.5 million, respectively for three months ended September 30, 2006. EBITDA and Adjusted EBITDA for all periods presented above includes the results of 7979 East Tufts Avenue, a property which we classified as held for sale and which we sold on July 12, 2006.

Financial Ratios

(unaudited and in thousands)

 

     31-Dec-07     30-Sep-07     30-Jun-07     31-Mar-07     31-Dec-06     30-Sep-06     30-Jun-06     31-Mar-06  

Total GAAP interest expense (including discontinued operations)

   15,863     16,683     15,142     17,323     14,569     14,533     12,181     11,388  

Capitalized interest

   4,215     3,096     2,792     1,507     1,114     917     1,058     762  

Change in accrued interest and other noncash amounts

   (2,755 )   (315 )   (3,575 )   (948 )   (3,206 )   (2,590 )   57     (1,906 )
                                                

Cash interest expense (a)

   17,323     19,464     14,359     17,882     12,477     12,860     13,296     10,244  

Scheduled debt principal payments and preferred dividends

   7,516     7,215     6,902     5,085     5,063     4,960     4,567     4,869  
                                                

Total fixed charges

   24,839     26,679     21,261     22,967     17,540     17,820     17,863     15,113  
                                                

Debt service coverage ratio based on GAAP interest expense (b)

   3.7x     3.4x     3.6x     4.2x     3.5x     4.3x     3.2x     3.2x  

Debt service coverage ratio based on cash interest expense (b)

   3.4x     2.9x     3.8x     4.1x     4.0x     4.9x     2.9x     3.6x  

Fixed charge coverage ratio based on GAAP interest expense (c)

   2.5x     2.4x     2.5x     3.3x     2.6x     3.2x     2.3x     2.2x  

Fixed charge coverage ratio based on cash interest expense (c)

   2.4x     2.1x     2.6x     3.2x     2.9x     3.5x     2.2x     2.4x  

Debt to total market capitalization including debt and preferred equity (d)

   30.6 %   30.7 %   28.8 %   30.7 %   31.1 %   33.4 %   32.3 %   30.8 %

Debt plus preferred stock to total market capitalization including debt and preferred equity (e)

   38.2 %   38.5 %   37.1 %   34.7 %   35.7 %   38.6 %   38.8 %   37.1 %

Pretax income to interest expense (f)

   1.4x     1.3x     1.5x     2.5x     1.5x     2.6x     1.5x     1.6x  

 

(a) Cash interest expense is interest expense less amortized deferred financing fees and includes interest that we capitalized. We consider cash interest expense to be a useful measure of interest as it excludes non-cash based interest expense.
(b) Adjusted EBITDA divided by interest expense. Ignoring the effect of the gain on sale of 100 Technology Center Drive and 4055 Valley View Lane, debt service coverage ratio was 3.2x using GAAP interest expense and 3.1x using cash interest expense for the three months ended March 31, 2007. Ignoring the effect of the gain on sale of 7979 East Tufts Avenue, debt service coverage ratio was 3.1x using GAAP interest expense and 3.5x using cash interest expense for the three months ended September 30, 2006.
(c) Adjusted EBITDA divided by fixed charges. Fixed charges include interest expense as per (a) above and scheduled debt principal payments and preferred dividends. Ignoring the effect of the gain on sale of 100 Technology Center Drive and 4055 Valley View Lane, fixed charges coverage ratio was 2.5x using GAAP interest expense and 2.4x using cash interest expense for the three months ended March 31, 2007. Ignoring the effect of the gain on sale of 7979 East Tufts Avenue, fixed charges coverage ratio was 2.3x using GAAP interest expense and 2.5x using cash interest expense for the three months ended September 30, 2006.
(d) Mortgage debt and other loans divided by mortgage debt and other loans plus the liquidation value of preferred stock and the market value of outstanding common stock and operating partnership units, assuming the redemption of operating partnership units for shares of our common stock. Mortgage debt and other loans amount excludes the outstanding principal for a loan related to 7979 East Tufts Avenue of $26.0 million. We classified this property as held for sale at June 30, 2006. We completed its sale on July 12, 2006 and the eliminated our liability for the $26.0 million loan.
(e) Same as (d), except numerator includes preferred stock.
(f) Calculated as income including gain on sale of assets before minority interest and interest divided by GAAP interest expense. Ignoring the effect of the gain on sale of 100 Technology Center Drive and 4055 Valley View Lane, pretax income to interest expense was 1.5x for the three months ended March 31, 2007. Ignoring the effect of the gain on sale of 7979 East Tufts Avenue, pretax income to interest expense was 1.4x for the three months ended September 30, 2006.

 

Page 10


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

Net Operating Income (NOI) and Run-rate NOI

For the three months ended December 31, 2007

(unaudited, in thousands)

 

Rental revenues

   $ 85,074  

Tenant reimbursements

     20,589  

Rental property operating and maintenance

     (33,101 )

Property taxes

     (4,440 )

Insurance

     (1,326 )
        

NOI

   $ 66,796  

Actual results of properties acquired during the quarter:

  

Rental revenues

     (151 )

Tenant reimbursements

     —    

Rental property operating and maintenance

     —    

Property taxes

     (1 )

Insurance

     —    

Projected full quarter of actual results of properties acquired during the quarter:

  

Rental revenues

     834  

Tenant reimbursements

     278  

Rental property operating and maintenance

     (245 )

Property taxes

     (184 )

Insurance

     (52 )
        

Run-rate NOI

   $ 67,275  
        

Reconciliation of net income available to common stockholders to NOI

  

Net income available to common stockholders

   $ 254  

Other revenues

     (240 )

Interest expense

     15,863  

Depreciation and amortization

     37,818  

General and administrative expenses

     8,159  

Other expenses

     101  

Equity in earnings of unconsolidated joint venture

     75  

Interest and other income

     (621 )

Minority interests in continuing operations of operating partnership

     28  

Income from discontinued operations before minority interests

     —    

Gain on sale of assets

     —    

Minority interests attributable to discontinued operations

     —    

Preferred stock dividends

     5,359  
        

NOI

   $ 66,796  
        

 

Note: NOI and run-rate NOI exclude the operations of properties sold in 2006 and 2007; 7979 East Tufts Avenue (July 2006), 100 Technology Center Drive (March 2007) and 4055 Valley View Lane (March 2007). For a definition and discussion of NOI and Run-rate NOI, see page 27.

 

Page 11


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

Same Store and New Properties Consolidated Quarterly Statements of Operations

(unaudited and in thousands, except share data)

 

     Three Months Ended  

Same store (1) 

   31-Dec-07     30-Sep-07     30-Jun-07     31-Mar-07     31-Dec-06     30-Sep-06     30-Jun-06     31-Mar-06  

Operating Revenues:

                

Rental

   $ 58,036     $ 57,033     $ 54,345     $ 52,698     $ 51,577     $ 48,827     $ 47,131     $ 45,517  

Tenant reimbursements

     17,667       18,202       14,171       13,640       12,811       12,790       11,930       11,203  

Other

     239       154       247       —         197       —         —         168  
                                                                

Total operating revenues

     75,942       75,389       68,763       66,338       64,585       61,617       59,061       56,888  
                                                                

Operating Expenses:

                

Rental property operating and maintenance

     21,322       20,229       15,545       13,561       13,718       13,388       12,573       10,999  

Property taxes

     3,734       6,869       6,428       6,847       5,967       6,646       6,556       6,530  

Insurance

     1,215       1,253       1,278       1,296       810       888       1,005       867  

Depreciation and amortization

     23,598       21,725       19,600       18,891       16,736       18,800       17,316       16,391  

General and administrative (2)

     8,159       7,775       8,456       7,210       6,535       4,986       4,674       4,246  

Other

     68       450       95       164       134       528       91       180  
                                                                

Total operating expenses

     58,096       58,301       51,402       47,969       43,900       45,236       42,215       39,213  

Operating income

     17,846       17,088       17,361       18,369       20,685       16,381       16,846       17,675  

Other Income (Expenses):

                

Equity in earnings of unconsolidated joint venture

     —         —         —         —         —         —         —         —    

Interest and other income

     441       414       376       356       274       245       194       174  

Interest expense (3)

     (12,364 )     (12,426 )     (12,248 )     (11,432 )     (10,117 )     (8,865 )     (8,546 )     (7,799 )

Loss from early extinguishment of debt

     —         —         —         —         (6 )     (40 )     (425 )     (57 )
                                                                

Income from continuing operations before
minority interests

     5,923       5,076       5,489       7,293       10,836       7,721       8,069       9,993  

Income (loss) from discontinued operations before minority interests

     —         (18 )     43       1,370       176       250       62       (174 )

Gain on sale of assets

     —         —         —         18,049       80       18,016       —         —    
                                                                

Income before minority interests

   $ 5,923     $ 5,058     $ 5,532     $ 26,712     $ 11,092     $ 25,987     $ 8,131     $ 9,819  
                                                                

New properties (1)

                

Operating Revenues:

                

Rental

   $ 27,038     $ 25,503     $ 24,360     $ 20,590     $ 16,750     $ 8,567     $ 2,769     $ 233  

Tenant reimbursements

     2,922       3,902       2,460       2,039       710       489       407       —    

Other

     1       —         —         —         —         —         —         —    
                                                                

Total operating revenues

     29,961       29,405       26,820       22,629       17,460       9,056       3,176       233  
                                                                

Operating Expenses:

                

Rental property operating and maintenance

     11,779       10,310       8,320       7,678       6,046       1,584       632       315  

Property taxes

     706       990       914       693       545       310       283       53  

Insurance

     111       103       141       130       16       46       45       5  

Depreciation and amortization

     14,220       13,620       12,232       10,508       10,555       4,967       1,218       146  

General and administrative (2)

     —         —         —         —         —         —         —         —    

Other

     33       45       33       24       39       79       59       1  
                                                                

Total operating expenses

     26,849       25,068       21,640       19,033       17,201       6,986       2,237       520  
                                                                

Operating income

     3,112       4,337       5,180       3,596       259       2,070       939       (287 )

Other Income (Expenses):

                

Equity in earnings of unconsolidated joint venture

     (75 )     (237 )     216       545       177       —         —         —    

Interest and other income

     180       207       156       157       142       119       68       54  

Interest expense (3)

     (3,499 )     (4,257 )     (3,016 )     (5,162 )     (3,985 )     (4,927 )     (2,703 )     (2,653 )

Loss from early extinguishment of debt

     —         —         —         —         1       —         —         —    
                                                                

Income from continuing operations before minority interests

     (282 )     50       2,536       (864 )     (3,406 )     (2,738 )     (1,696 )     (2,886 )

Income from discontinued operations before minority interests

     —         —         —         —         —         —         —         —    

Gain on sale of assets

     —         —         —         —         —         —         —         —    
                                                                

Income before minority interests

   $ (282 )   $ 50     $ 2,536     $ (864 )   $ (3,406 )   $ (2,738 )   $ (1,696 )   $ (2,886 )
                                                                

 

(1) Same store properties are properties that were acquired before December 31, 2005 and new properties are properties acquired after December 31, 2005. During 2007 and 2006, we sold 7979 East Tufts Avenue (July 2006), 100 Technology Center Drive (March 2007) and 4055 Valley View Lane (March 2007). We have presented all activity for these properties in Income (loss) from discontinued operations for all periods presented above.
(2) General and administrative expenses are included entirely in same store as they are not allocable to specific properties.
(3) Interest expense on our revolving credit facility is allocated entirely to new properties.

 

Page 12


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

Same Store Operating Trend Summary

(unaudited and in thousands, except share data)

 

     Three Months Ended  

Same store (1) 

   31-Dec-07     30-Sep-07     Percentage
Change
    31-Dec-06     Percentage
Change
 

Rental (2)

   $ 58,036     $ 57,033     1.8 %   $ 51,577     12.5 %

Tenant reimbursements

     17,667       18,202     (2.9 )%     12,811     37.9 %
                                    
     75,703       75,235     0.6 %     64,388     17.6 %

Rental property operating and maintenance

     21,322       20,229     5.4 %     13,718     55.4 %

Property taxes

     3,734       6,869     (45.6 )%     5,967     (37.4 )%

Insurance

     1,215       1,253     (3.0 )%     810     50.0 %
                                    
     26,271       28,351     (7.3 )%     20,495     28.2 %
                                    

Net Operating Income (3)

   $ 49,432     $ 46,884     5.4 %   $ 43,893     12.6 %
                                    

Same store occupancy at end of quarter

     93.9 %     94.4 %       94.9 %  
                            

 

(1) Same store properties were acquired before December 31, 2005.
(2) For the periods presented, same store straight-line rent was $5,285, $5,417 and $5,037, respectively and non-cash adjustments related to FAS 141 were $713, $695 and $732, respectively.
(3) For a definition and discussion of Net Operating Income, see page 27.

 

Page 13


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

Consolidated Debt Analysis

(unaudited, in thousands)

 

     Maturity Date          Principal Balance as of
December 31, 2007
   % of Debt     Interest Rate as of
December 31, 2007
    Interest Rate as of
December 31, 2007
including swaps
 

Unhedged Floating Rate Debt

              

Revolving credit facility

   August 31, 2010    (1 )   $ 299,731    22.0 %   6.54 %   —    
                              
        $ 299,731    22.0 %    

Fixed Rate Mortgage Debt and Hedged Floating Rate Debt

           

Secured Term Debt

   November 11, 2014        148,738    10.9 %   5.65 %   —    

350 East Cermak Road

   June 9, 2008    (1 )     97,993    7.2 %   6.80 %   6.23 %

200 Paul Avenue 1-4

   October 8, 2015        80,768    5.9 %   5.74 %   —    

2045 & 2055 LaFayette Street

   February 6, 2017        68,000    5.0 %   5.93 %   —    

600 West Seventh Street

   March 15, 2016        58,032    4.2 %   5.80 %   —    

2323 Bryan Street

   November 6, 2009        55,832    4.1 %   6.04 %   —    

34551 Ardenwood Boulevard 1-4

   November 11, 2016        55,000    4.0 %   5.95 %   —    

1100 Space Park Drive

   December 11, 2016        55,000    4.0 %   5.89 %   —    

150 South First Street

   February 6, 2017        53,288    3.9 %   6.30 %   —    

114 Rue Ambroise Croizat

   January 18, 2012        47,294    3.5 %   6.03 %   5.13 %

2334 Lundy Place

   November 11, 2016        40,000    2.9 %   5.96 %   —    

Unit 9, Blanchardstown Corporate Park

   January 18, 2012        40,661    3.0 %   6.03 %   5.35 %

6 Braham Street

   April 10, 2011        26,172    1.9 %   6.89 %   5.84 %

Paul van Vlissingenstraat 16

   July 18, 2013        15,965    1.2 %   6.28 %   5.58 %

Chemin de l’Epinglier 2

   July 18, 2013        11,594    0.8 %   6.18 %   5.57 %

1125 Energy Park Drive

   March 1, 2032        9,456    0.7 %   7.62 %   —    

Gyroscoopweg 2E-2F

   October 18, 2013        10,163    0.7 %   6.18 %   5.49 %

375 Riverside Parkway

   December 1, 2008        8,564    0.6 %   6.55 %   6.87 %

731 East Trade Street

   July 1, 2020        5,708    0.4 %   8.22 %   —    

1500 Space Park Drive

   April 5, 2008        5,541    0.4 %   7.35 %  
                      
        $ 893,769    65.3 %    

Exchangeable senior debentures

        $ 172,500    12.6 %   4.13 %   —    

3 Corporate Place construction loan

        $ —      0.0 %   7.57 %   —    
                      

Total Fixed Rate Debt Including Swaps

        $ 1,066,269    77.9 %    

Loan premium—1125 Energy Park Drive and 731 East Trade Street

          1,738    0.1 %    
                      

Total Consolidated Debt

        $ 1,367,738    100.0 %    
                      

Weighted average cost of debt (including interest rate swaps)

               5.81 %
                  

 

(1) Two one-year extensions are available.

Credit Facility

(in thousands)

 

     Maximum Available    Available as of
December 31, 2007
   Drawn as of
December 31,
2007

Unsecured Revolving Credit Facility

   $ 650,000    $ 339,000    $ 299,731

 

Page 14


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

Debt Maturities

(unaudited, in thousands)

 

Property

         2008    2009    2010    2011    2012    Thereafter    Total

Revolving credit facility

   (1 )   $ —      $ —      $ 299,731    $ —      $ —      $ —      $ 299,731

Secured Term Debt

   (2 )     2,252      2,409      2,550      2,700      2,836      135,991      148,738

350 East Cermak Road

   (3 )     97,993      —        —        —        —        —        97,993

200 Paul Avenue 1-4

       1,433      1,533      1,624      1,721      1,812      72,645      80,768

2045 & 2055 LaFayette Street

       —        729      835      886      940      64,610      68,000

600 West Seventh Street

       1,218      1,290      1,367      1,448      1,535      51,174      58,032

2323 Bryan Street

       794      55,038      —        —        —        —        55,832

1100 Space Park Drive

       —        56      648      687      720      52,889      55,000

34551 Ardenwood Boulevard 1-4

       —        55      639      679      711      52,916      55,000

150 South First Street

       —        518      595      635      677      50,863      53,288

114 Rue Ambroise Croizat

       717      717      717      717      44,426      —        47,294

2334 Lundy Place

       —        40      464      493      517      38,486      40,000

Unit 9, Blanchardstown Corporate Park

       617      617      617      617      38,193      —        40,661

6 Braham Street

       —        595      793      24,784      —        —        26,172

Paul van Vlissingenstraat 16

       245      245      245      245      245      14,740      15,965

Chemin de l’Epinglier 2

       177      177      177      177      177      10,709      11,594

1125 Energy Park Drive

       123      132      143      155      8,903      —        9,456

Gyroscoopweg 2E-2F

       155      155      155      155      155      9,388      10,163

375 Riverside Parkway

       8,564      —        —        —        —        —        8,564

731 East Trade Street

       188      205      235      274      297      4,509      5,708

1500 Space Park Drive

       5,541      —        —        —        —        —        5,541

Exchangeable senior debentures

   (4 )     —        —        —        172,500      —        —        172,500
                                                  

Total

     $ 120,017    $ 64,511    $ 311,535    $ 208,873    $ 102,144    $ 558,920    $ 1,366,000
                                                  

Weighted Average Term to Initial Maturity

   (4 )                 5.2 Years      

Weighted Average Term to Initial Maturity (assuming exercise of extension options)

   (4 )                 5.8 Years      

 

(1) Two one-year extension options are available.
(2) This amount represents six mortgage loans secured by our interests in 36 NE 2nd Street, 3300 East Birch Street, 100 & 200 Quannapowitt Parkway, 300 Boulevard East, 4849 Alpha Road, and 11830 Webb Chapel Road. Each of these loans are cross-collateralized by the six properties.
(3) Two one-year extensions are available.
(4) Assumes maturity of Exchangeable senior debentures at first redemption date in August 2011.

Note: Except as provided, above amounts assume no exercise of extensions and total excludes $1,738 of Loan Premiums.

 

Page 15


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

Portfolio Summary

As of December 31, 2007

 

     12/31/2007     9/30/2007  

Number of Properties:

    

Domestic

   57     57  

International

   13     10  
            
   70 (2)   67 (2)

Number of Buildings:

    

Domestic

   77     77  

International

   16     11  
            
   93     88  

Number of Markets:

    

Domestic

   20     20  

International

   6     6  
            
   26     26  

Net Rentable Square Feet:

    

Domestic

   9,802,686     9,709,992  

International

   724,325     601,865  
            
   10,527,011     10,311,857  

Redevelopment Square Feet:

    

Domestic

   1,226,346     1,319,040  

International

   527,882     389,019  
            
   1,754,228     1,708,059  

Portfolio Occupancy (1)

   94.7 %   95.1 %

Same Store Pool Occupancy

   93.9 %   94.4 %

Average Original Lease Term (years)

   13.6     13.2  

Average Remaining Lease Term (years)

   7.7     7.5  

Lease Expirations (through 2009)

   8.1 %   9.7 %

 

(1) Occupancy excludes space held for redevelopment.
(2) Excludes a property held as an investment in an unconsolidated joint venture.

 

Page 16


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

Properties Acquired

For the three months ended December 31, 2007

 

Property

   Metropolitan Area    Date Acquired    Purchase Price
(in millions)
   Net Rentable
Square
Footage of
Property
   Total Square
Footage Held for
Redevelopment
   Percentage of
Total Rentable
Square Footage
of Property
Occupied (1)
 

Cressex 1

   London, UK    December-07    $ 12.7    50,847    50,847    Vacant  

Naritaweg 52

   Amsterdam, NL    December-07    $ 27.2    63,238    —      100.0 %

Foxboro Business Park (2)

   London, UK    December-07    $ 43.6    147,215    96,384    100.0 %
                             
         $ 83.5    261,300    147,231    100.0 %
                             

 

(1) Occupancy percentages are calculated net of square footage held for redevelopment.
(2) The purchase consists of three buildings: 1 St. Anne’s Boulevard, 2 St. Anne’s Boulevard and 3 St. Anne’s Boulevard.

 

Page 17


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

Occupancy Analysis

As of December 31, 2007

 

                                  Occupancy (2)     Net Rentable Square Feet
as a % of
    Annualized Rent
as a % of
 

Property

       Acquisition
date
   Metropolitan Area    Net Rentable
Square Feet
   Redevelopment
Space
   Annualized Rent
($000) (1)
   As of
12/31/2007
    As of
9/30/07
    As of
6/30/07
    As of
3/31/07
    Property
Type
    Total
Portfolio
    Property
Type
    Total
Portfolio
 

Internet Gateways

                                 

350 East Cermak Road

     May-05    Chicago    974,837    158,902    32,149    98.3 %   97.4 %   94.7 %   94.6 %   26.3 %   9.2 %   23.1 %   11.1 %

120 E. Van Buren Street

     Jul-06    Phoenix    249,425    38,089    19,045    84.6 %   97.2 %   97.2 %   92.0 %   6.8     2.4     13.7     6.5  

200 Paul Avenue 1-4

     Nov-04    San Francisco    527,680    —      19,054    97.4 %   100.0 %   100.0 %   100.0 %   14.3     5.0     13.7     6.6  

2323 Bryan Street

     Jan-02    Dallas    457,217    19,890    13,257    78.7 %   79.6 %   79.6 %   83.5 %   12.4     4.3     9.5     4.6  

600 West Seventh Street

     May-04    Los Angeles    482,089    7,633    13,042    89.4 %   91.8 %   91.6 %   93.4 %   13.1     4.6     9.4     4.5  

111 Eighth Avenue

 

(3)

   Mar-07    New York    116,843    —      11,179    100.0 %   100.0 %   100.0 %   100.0 %   3.2     1.1     8.0     3.8  

1100 Space Park Drive

     Nov-04    Silicon Valley    165,297    —      7,200    97.6 %   97.6 %   97.6 %   97.6 %   4.5     1.6     5.2     2.5  

114 Rue Ambroise Croizat

     Dec-06    Paris, France    130,996    221,150    5,062    100.0 %   91.6 %   91.6 %   91.6 %   3.6     1.2     3.6     1.7  

600-780 S. Federal

     Sep-05    Chicago    161,547    —      5,005    80.3 %   81.5 %   82.6 %   82.6 %   4.4     1.5     3.6     1.7  

6 Braham Street

     Jul-02    London, England    63,233    —      4,402    100.0 %   100.0 %   100.0 %   100.0 %   1.7     0.6     3.2     1.5  

36 NE 2nd Street

     Jan-02    Miami    162,140    —      4,280    95.9 %   95.9 %   95.9 %   95.9 %   4.4     1.5     3.1     1.5  

900 Walnut Street

     Aug-07    St Louis    112,266    —      3,333    98.6 %   98.6 %   NA     NA     3.0     1.1     2.4     1.1  

731 East Trade Street

     Aug-05    Charlotte    40,879    —      1,131    100.0 %   100.0 %   100.0 %   100.0 %   1.1     0.4     0.8     0.4  

113 North Myers

     Aug-05    Charlotte    20,086    9,132    707    100.0 %   100.0 %   100.0 %   100.0 %   0.5     0.2     0.5     0.2  

125 North Myers

     Aug-05    Charlotte    25,402    —      390    51.3 %   51.3 %   51.3 %   47.9 %   0.7     0.2     0.3     0.1  
                                                                       
           3,689,937    454,796    139,236    92.6 %   94.1 %   92.8 %   93.5 %   100.0 %   34.9 %   100.0 %   47.8 %

Data Centers

                                 

300 Boulevard East

     Nov-02    New York    311,950    —      12,778    100.0 %   100.0 %   100.0 %   100.0 %   5.6     3.0     10.2     4.4  

833 Chestnut Street

     Mar-05    Philadelphia    580,147    74,611    9,653    80.5 %   79.4 %   79.2 %   78.6 %   10.6     5.5     7.7     3.3  

Unit 9, Blanchardstown Corporate Park

     Dec-06    Dublin, Ireland    120,000    —      9,016    96.4 %   85.9 %   85.9 %   85.9 %   2.2     1.1     7.3     3.1  

2045 & 2055 LaFayette Street

     May-04    Silicon Valley    300,000    —      6,300    100.0 %   100.0 %   100.0 %   100.0 %   5.4     2.8     5.1     2.2  

3 Corporate Place

     Dec-05    New York    205,106    71,825    6,167    88.4 %   100.0 %   100.0 %   100.0 %   3.7     1.9     5.0     2.1  

11830 Webb Chapel Road

     Aug-04    Dallas    365,647    —      5,788    96.6 %   96.6 %   95.0 %   95.0 %   6.7     3.5     4.7     2.0  

150 South First Street

     Sep-04    Silicon Valley    179,761    —      5,094    97.7 %   97.7 %   97.7 %   100.0 %   3.2     1.7     4.1     1.8  

12001 North Freeway

     Apr-06    Houston    280,483    20,222    4,307    98.5 %   98.5 %   98.5 %   98.5 %   5.1     2.7     3.5     1.5  

14901 FAA Boulevard

     Jun-06    Dallas    263,700    —      4,474    100.0 %   100.0 %   100.0 %   100.0 %   4.8     2.5     3.6     1.5  

2334 Lundy Place

     Dec-02    Silicon Valley    130,752    —      4,253    100.0 %   100.0 %   100.0 %   100.0 %   2.4     1.2     3.4     1.5  

44470 Chilum Place

     Feb-07    Northern Virginia    95,440    —      3,906    100.0 %   100.0 %   100.0 %   100.0 %   1.7     0.9     3.2     1.3  

2401 Walsh Street

     Jun-05    Silicon Valley    167,932    —      3,211    100.0 %   100.0 %   100.0 %   100.0 %   3.0     1.6     2.6     1.1  

8534 Concord Center Drive

     Jun-05    Denver    85,660    —      3,169    100.0 %   100.0 %   100.0 %   100.0 %   1.5     0.8     2.6     1.1  

Naritaweg 52

     Dec-07    Amsterdam, Netherlands    63,260    —      2,866    100.0 %   N/A     N/A     N/A     1.1     0.6     2.3     1.0  

4025 Midway Road

     Jan-06    Dallas    72,991    27,599    2,459    54.9 %   54.9 %   54.9 %   50.5 %   1.3     0.7     2.0     0.8  

210 N Tucker Boulevard

     Aug-07    St Louis    139,588    62,000    2,266    95.0 %   95.0 %   NA     NA     2.5     1.3     1.8     0.8  

375 Riverside Parkway

     Jun-03    Atlanta    200,442    49,749    2,238    92.9 %   92.9 %   92.9 %   100.0 %   3.6     1.9     1.8     0.8  

200 North Nash Street

     Jun-05    Los Angeles    113,606    —      2,172    100.0 %   100.0 %   100.0 %   100.0 %   2.1     1.1     1.8     0.7  

Paul van Vlissingenstraat 16

     Aug-05    Amsterdam, Netherlands    77,472    35,000    2,166    58.8 %   58.8 %   58.8 %   58.8 %   1.4     0.7     1.8     0.7  

115 Second Avenue

     Oct-05    Boston    66,730    —      2,064    42.1 %   42.1 %   0.0 %   0.0 %   1.2     0.6     1.7     0.7  

2403 Walsh Street

     Jun-05    Silicon Valley    103,940    —      1,988    100.0 %   100.0 %   100.0 %   100.0 %   1.9     1.0     1.6     0.7  

1807 Michael Faraday Court

     Oct-06    Northern Virginia    19,237    —      1,953    100.0 %   100.0 %   100.0 %   100.0 %   0.3     0.2     1.6     0.7  

8100 Boone Boulevard

     Oct-06    Northern Virginia    17,015    —      1,886    100.0 %   100.0 %   100.0 %   100.0 %   0.3     0.2     1.5     0.6  

4700 Old Ironsides Drive

     Jun-05    Silicon Valley    90,139    —      1,724    100.0 %   100.0 %   100.0 %   100.0 %   1.6     0.9     1.4     0.6  

4650 Old Ironsides Drive

     Jun-05    Silicon Valley    84,383    —      1,614    100.0 %   100.0 %   100.0 %   100.0 %   1.5     0.8     1.3     0.6  

Chemin de l’Epinglier 2

     Nov-05    Geneva, Switzerland    59,190    —      1,594    100.0 %   100.0 %   100.0 %   100.0 %   1.1     0.6     1.3     0.5  

3065 Gold Camp Drive

     Oct-04    Sacramento    62,957    —      1,502    100.0 %   100.0 %   100.0 %   100.0 %   1.1     0.6     1.2     0.5  

3015 Winona Avenue

     Dec-04    Los Angeles    82,911    —      1,500    100.0 %   100.0 %   100.0 %   100.0 %   1.5     0.8     1.2     0.5  

21110 Ridgetop Circle

     Jan-07    Northern Virginia    135,513    —      1,480    100.0 %   100.0 %   100.0 %   100.0 %   2.4     1.3     1.2     0.5  

251 Exchange Place

     Nov-05    Northern Virginia    70,982    —      1,458    100.0 %   100.0 %   100.0 %   100.0 %   1.3     0.7     1.2     0.5  

6800 Millcreek Drive

     Apr-06    Toronto, Canada    83,758    —      1,442    100.0 %   100.0 %   100.0 %   100.0 %   1.5     0.8     1.2     0.5  

 

Page 18


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

Occupancy Analysis

As of December 31, 2007

 

                              Occupancy (2)     Net Rentable Square Feet
as a % of
   Annualized Rent
as a % of
 

Property

   Acquisition
date
   Metropolitan Area    Net
Rentable
Square Feet
   Redevelopment
Space
   Annualized
Rent
($000) (1)
   As of
12/31/2007
    As of
9/30/07
    As of
6/30/07
    As of
3/31/07
    Property
Type
   Total
Portfolio
   Property
Type
   Total
Portfolio
 

Clonshaugh Industrial Estate

   Feb-06    Dublin, Ireland    20,000    —        1,442    100.0 %   100.0 %   100.0 %   100.0 %   0.4    0.2    1.2    0.5  

1125 Energy Park Drive

   Mar-05    Minneapolis/St. Paul    112,827    —        1,437    100.0 %   100.0 %   100.0 %   100.0 %   2.0    1.1    1.2    0.5  

101 Aquila Way

   Apr-06    Atlanta    313,581    —        1,411    100.0 %   100.0 %   100.0 %   100.0 %   5.8    3.0    1.1    0.5  

43831 Devon Shafron Drive

   Mar-07    Northern Virginia    117,071    —        1,377    100.0 %   100.0 %   100.0 %   100.0 %   2.1    1.1    1.1    0.5  

3300 East Birch Street

   Aug-03    Los Angeles    68,807    —        1,319    100.0 %   100.0 %   100.0 %   100.0 %   1.2    0.7    1.1    0.5  

Gyroscoopweg 2E-2F

   Jul-06    Amsterdam, Netherlands    55,585    —        1,232    100.0 %   100.0 %   100.0 %   100.0 %   1.0    0.5    1.0    0.4  

600 Winter Street

   Sep-06    Boston    30,400    —        763    100.0 %   100.0 %   100.0 %   100.0 %   0.5    0.3    0.6    0.3  

7620 Metro Center Drive

   Dec-05    Austin    45,000    —        605    100.0 %   100.0 %   100.0 %   100.0 %   0.8    0.4    0.5    0.2  

2300 NW 89th Place

   Sep-06    Miami    64,174    —        581    100.0 %   100.0 %   100.0 %   100.0 %   1.2    0.6    0.5    0.2  

43881 Devon Shafron Drive

   Mar-07    Northern Virginia    50,000    130,000      473    100.0 %   100.0 %   100.0 %   100.0 %   0.9    0.5    0.4    0.2  

1 St. Anne’s Boulevard

   Dec-07    London, England    20,219    —        327    100.0 %   NA     NA     NA     0.4    0.2    0.3    0.1  

2440 Marsh Lane

   Jan-03    Dallas    5,500    129,750      62    100.0 %   100.0 %   100.0 %   100.0 %   0.1    0.1    0.1    —    

Clonshaugh Industrial Estate (Land)

   Feb-06    Dublin, Ireland    —      124,500      —      0.0 %   NA     NA     NA     —      —      —      —    

Cressex 1

   Dec-07    London, England    —      50,848      —      0.0 %   NA     NA     NA     —      —      —      —    

3 St. Anne’s Boulevard

   Dec-07    London, England    —      96,384      —      0.0 %   NA     NA     NA     —      —      —      —    

2055 East Technology Circle

   Oct-06    Phoenix    —      76,350      —      0.0 %   —       0.0 %   0.0 %   —      —      —      —    

3011 Lafayette Street

   Jan-07    Silicon Valley    —      90,780      —      0.0 %   —       0.0 %   0.0 %   —      —      —      —    

43791 Devon Shafron Drive

   Mar-07    Northern Virginia    —      135,000      —      0.0 %   —       0.0 %   0.0 %   —      —      —      —    

1500 Space Park Drive

   Sep-07    Silicon Valley    —      49,852      —      0.0 %   NA     NA     NA     —      —      —      —    

7500 Metro Center Drive

   Dec-05    Austin    —      74,962      —      0.0 %   —       0.0 %   0.0 %   —      —      —      —    
                                                                    
         5,533,856    1,299,432      123,517    94.8 %   94.5 %   94.4 %   94.4 %   100.0    52.7    100.0    42.5 %

Technology Manufacturing

                                  

34551 Ardenwood Boulevard 1-4

   Jan-03    Silicon Valley    307,657    —        8,206    100.0 %   100.0 %   100.0 %   100.0 %   48.5    2.9    53.8    2.8 %

47700 Kato Road & 1055 Page Avenue

   Sep-03    Silicon Valley    183,050    —        3,684    100.0 %   100.0 %   100.0 %   100.0 %   28.8    1.7    24.2    1.3  

2010 East Centennial Circle

   May-03    Phoenix    113,405    —        2,852    100.0 %   100.0 %   100.0 %   100.0 %   17.9    1.1    18.7    1.0  

2 St. Anne’s Boulevard

   Dec-07    London, England    30,612    —        496    100.0 %   NA     NA     NA     4.8    0.3    3.3    0.2  
                                                                    
         634,724    —        15,237    100.0 %   100.0 %   100.0 %   100.0 %   100.0    6.0    100.0    5.3 %

Technology Office

                                  

100 & 200 Quannapowitt Parkway

   Jun-04    Boston    386,956    —        7,305    100.0 %   100.0 %   100.0 %   100.0 %   57.9    3.7    57.0    2.5 %

4849 Alpha Road

   Apr-04    Dallas    125,538    —        2,856    100.0 %   100.0 %   100.0 %   100.0 %   18.8    1.2    22.3    1.0  

1 Savvis Parkway

   Aug-07    St Louis    156,000    —        2,644    100.0 %   100.0 %   NA     NA     23.3    1.5    20.7    0.9  
                                                                    
         668,494    —        12,805    100.0 %   100.0 %   100.0 %   100.0 %   100.0    6.4    100.0    4.4 %
                                                                    

Portfolio Total/Weighted Average

         10,527,011    1,754,228    $ 290,795    94.7 %   95.1 %   94.6 %   94.8 %   100.0    100.0    100.0    100.0 %
                                                                    

 

(1) Annualized rent represents the monthly contractual rent under existing leases as of December 31, 2007 multiplied by 12.
(2) Occupancy excludes space held for redevelopment.
(3) Includes approximately 33,700 RSF from leasehold interest acquisition.
(4) Net Rentable Square Feet excludes 400,369 RSF of space in joint venture located at 2001 Sixth Avenue in Seattle, WA, which was 97.0% occupied as of December 31, 2007.

 

Page 19


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

Major Tenants

as of December 31, 2007

 

    

Tenant

       Number of
Locations
   Total Occupied
Square Feet (1)
   Percentage of
Net Rentable
Square Feet
    Annualized
Rent ($000) (2)
   Percentage
of Annualized Rent
    Weighted
Average
Remaining
Lease Term
in Months

1

  

Savvis Communications

     16    1,578,005    15.0 %   $ 34,223    11.8 %   132

2

  

Qwest Communications International, Inc.

     13    770,928    7.3 %   $ 23,926    8.2 %   91

3

  

Equinix Operating Company, Inc.

     4    454,672    4.3 %   $ 12,042    4.1 %   107

4

  

TelX Group, Inc.

     10    82,581    0.8 %   $ 10,185    3.5 %   227

5

  

AT & T

     11    386,430    3.7 %   $ 8,729    3.0 %   77

6

  

NTT Communications Company

     2    241,370    2.3 %   $ 7,294    2.5 %   57

7

  

Comverse Technology, Inc.

     1    367,033    3.5 %   $ 7,006    2.4 %   37

8

  

JPMorgan Chase & Co.

     2    27,377    0.3 %   $ 6,960    2.4 %   105

9

  

Microsoft Corporation

     1    300,000    2.8 %   $ 6,300    2.2 %   93

10

  

Level 3 Communications, LLC

 

(3)

   11    289,788    2.8 %   $ 5,871    2.0 %   52

11

  

AboveNet, Inc.

     8    150,661    1.4 %   $ 5,859    2.0 %   127

12

  

Amgen, Inc.

     1    131,386    1.2 %   $ 5,551    1.9 %   89

13

  

Amazon

     3    164,847    1.6 %   $ 5,402    1.9 %   141

14

  

Leslie & Godwin Investments

 

(4)

   1    63,233    0.6 %   $ 4,402    1.5 %   24

15

  

Thomas Jefferson University

     1    181,414    1.7 %   $ 3,807    1.3 %   125
                                    
  

Total/Weighted Average

        5,189,725    49.3 %   $ 147,557    50.7 %   101
                                    

 

(1) Occupied square footage is defined as leases that have commenced on or before December 31, 2007.
(2) Annualized rent represents the monthly contractual rent under existing leases as of December 31, 2007 multiplied by 12.
(3) Level 3 Communications includes Wiltel Communications & Broadwing Communications.
(4) Leslie & Godwin is a UK subsidiary of AON Corporation.

 

Page 20


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

UTILITY POWER CAPACITY (1)

Top 15 Properties

 

    

Property Name

  

Market

   Capacity (MW)

1

  

Devon Shafron Drive (3 Buildings)

  

Northern Virginia

   225

2

  

350 East Cermak Road

  

Chicago

   100

3

  

1500 Space Park (3 Buildings)

  

Santa Clara

   59

4

  

3 Corporate Place

  

New York

   44

5

  

114 Rue Ambroise Croizat

  

Paris, France

   40

6

  

2045 & 2055 LaFayette Street

  

Silicon Valley

   40

7

  

44470 Chilum Place

  

Northern Virginia

   36

8

  

150 South First Street

  

Silicon Valley

   36

9

  

101 Aquila Way

  

Atlanta

   30

10

  

14901 FAA Boulevard

  

Dallas

   25

11

  

2401 Walsh Street

  

Silicon Valley

   25

12

  

2403 Walsh Street

  

Silicon Valley

   25

13

  

4700 Old Ironsides Drive

  

Silicon Valley

   25

14

  

8534 Concord Center Drive

  

Denver

   23

15

  

300 Boulevard East

  

New York

   21
          
  

Total Potential Power Capacity - Top 15 Properties

      754

 

(1) Utility Power Capacity is defined as the power that could potentially be provided by the utility company depending upon factors such as peak demand load at the property.

 

Page 21


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

Lease Expirations and Lease Distribution

Lease Expirations

As of December 31, 2007

 

Year

  Number of
Leases Expiring
(1)
  Square
Footage of
Expiring
Leases
  Percentage of
Net Rentable
Square Feet
    Annualized
Rent ($000) (1)
  Percentage of
Annualized Rent
    Annualized Rent
Per Occupied
Square Foot
  Annualized Rent
Per Occupied
Square Foot at
Expiration
  Annualized
Rent at
Expiration
($000)

Available

    559,964   5.3 %   $ —     0.0 %      

2008

  269   370,801   3.5 %     23,695   8.1 %   $ 63.90     67.70     25,103

2009

  107   479,753   4.6 %     16,998   5.8 %   $ 35.43     38.43     18,435

2010

  92   894,705   8.5 %     23,403   8.0 %   $ 26.16     27.34     24,461

2011

  77   1,586,813   15.1 %     33,024   11.4 %   $ 20.81     23.37     37,089

2012

  63   158,956   1.5 %     13,102   4.5 %   $ 82.42     93.09     14,797

2013

  24   480,588   4.6 %     9,676   3.3 %   $ 20.13     23.12     11,113

2014

  31   497,859   4.7 %     12,842   4.4 %   $ 25.79     32.03     15,945

2015

  77   1,738,028   16.5 %     55,983   19.3 %   $ 32.21     38.21     66,413

2016

  55   828,480   7.9 %     27,300   9.4 %   $ 32.95     39.00     32,308

2017

  30   543,260   5.2 %     13,406   4.6 %   $ 24.68     36.24     19,687

Thereafter

  95   2,387,804   22.6 %     61,366   21.2 %   $ 25.70     39.94     95,373
                                           

Portfolio Total /Weighted Average

  920   10,527,011   100.0 %   $ 290,795   100.0 %   $ 29.18   $ 36.19   $ 360,725
                                           

Lease Distribution

As of December 31, 2007

 

Square Feet Under Lease

   Number of
Leases
   Percentage of
All Leases
    Total Net
Rentable
Square Feet
   Percentage of
Net Rentable
Square Feet
    Annualized Rent
($000) (2)
   Percentage of
Annualized Rent
 

Available

        559,964    5.3 %     —      0.0 %

2,500 or less

   622    67.5 %   269,662    2.6 %     55,989    19.3 %

2,501 - 10,000

   134    14.6 %   771,273    7.3 %     27,824    9.6 %

10,001 - 20,000

   52    5.7 %   1,007,783    9.6 %     26,663    9.2 %

20,001 - 40,000

   46    5.0 %   1,473,385    14.0 %     36,750    12.6 %

40,001 - 100,000

   42    4.6 %   2,841,402    27.0 %     73,313    25.1 %

Greater than 100,000

   24    2.6 %   3,603,542    34.2 %     70,256    24.2 %
                                   

Portfolio Total

   920    100.0 %   10,527,011    100.0 %   $ 290,795    100.0 %
                                   

 

(1) Includes license and similar agreements that upon expiration will be automatically renewed, mostly on a month-to-month basis.
(2) Annualized rent represents the monthly contractual rent under existing leases as of December 31, 2007 multiplied by 12.

 

Page 22


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

Leasing Activity

As of December 31, 2007

 

     For the Three
Months Ended
December 31, 2007
    % Leased  

Occupied Square Feet as of September 30, 2007

   9,804,360       95.1 %

4Q 2007 Acquisitions:

    

Cressex 1

   —         —    

Naritaweg 52

   63,260       100.0 %

1 St. Anne’s Boulevard

   20,219       100.0 %

2 St. Anne’s Boulevard

   30,612       100.0 %

3 St. Anne’s Boulevard

   —         —    
              

Occupied Square Feet including Q4 2007 Acquisitions

   9,918,451       94.2 %

Expirations, Terminations and Reductions

   (25,927 )     (0.2 )%

New Leases and Expansions

   60,960       0.6 %

Renewals and Extensions

   —         0.0 %

Remeasurements (1)

   13,563       0.1 %
              

Occupied Square Feet as of December 31, 2007

   9,967,047       94.7 %
              

GAAP Rent Growth (2)

    

Expiring Rent per Square Foot

     $ 38.41  

New Rent per Square Foot

     $ 48.37  

Percentage Increase

       25.9 %

Weighted Average Lease Term - New (in months)

       118  

 

(1) Represents remeasuring of building and/or specific areas to Building Owners and Managers Association (BOMA) standards.
(2) Represents estimated cash rent growth adjusted for straight-line rents in accordance with GAAP.

 

Page 23


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

Tenant Improvements and Leasing Commissions

 

     Three Months Ended    Full Year
2006
     12/31/2007    9/30/2007    6/30/2007    3/31/2007   

Renewals (1)

              

Number of renewals

     4      2      3      2      8

Square Feet

     27,587      944      1,313      33,489      12,664

Tenant improvement costs per square foot (2)

   $ 9.61    $ —      $ —      $ —      $ —  

Leasing commission costs per square foot (2)

   $ 12.75    $ 0.33    $ 1.73    $ 16.63    $ 3.87
                                  

Total renewal lease costs per square foot

   $ 22.35    $ 0.33    $ 1.73    $ 16.63    $ 3.87

New Leases (3)

              

Number of non-redevelopment leases

     10      12      9      23      197

Non-Redevelopment square feet

     44,919      38,082      12,014      35,255      305,532

Non-Redevelopment tenant improvement costs per square foot (2)

     11.43      13.35    $ —      $ 3.62    $ 56.66

Non-Redevelopment leasing commission costs per square foot (2)

     12.42      11.61      11.27      11.63      10.63

Number of redevelopment leases

     3      8      10      6      6

Redevelopment square feet

     16,041      153,571      64,197      307,717      173,465

Redevelopment tenant improvement costs per square foot (2) (5)

   $ —      $ 0.81    $ 6.90    $ 79.78    $ 68.65

Redevelopment leasing commission costs per square foot (2)

   $ 0.31    $ 9.18    $ 12.04    $ 6.43    $ 13.46
                                  

Total Number of Leases

     13      20      19      29      203

Total Square Feet

     60,960      191,652      76,211      342,972      478,997

Total new lease costs per square foot

   $ 17.66    $ 12.96    $ 17.73    $ 101.46    $ 26.30

Total (4)

              

Number of leases

     17      22      22      31      211

Square Feet

     88,547      192,596      77,524      376,461      491,661

Tenant improvement costs per square foot (2)

   $ 8.79    $ 3.28    $ 5.71    $ 65.55    $ 59.43

Leasing commission costs per square foot (2)

   $ 10.33    $ 9.62    $ 11.75    $ 7.82    $ 12.79
                                  

Total costs per square foot

   $ 19.12    $ 12.90    $ 17.46    $ 73.37    $ 72.22

 

(1) Does not include retained tenants that have relocated to new space or expanded into new space.
(2) Assumes all tenant improvement and leasing commissions are paid in the calendar year in which the lease commences, which may be different than the year in which they are actually paid.
(3) Includes retained tenants that have relocated to new space or expanded into new space within our portfolio.
(4) Recent property acquisitions may make a period over period comparison difficult. For a list of the acquisition dates of our properties see page 17.
(5) Redevelopment Tenant Improvement costs include tenant-specific building improvements for square footage designated as space held for redevelopment.

 

Page 24


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

Historical Capital Expenditures

 

      Three Months Ended    Full Year
      12/31/2007    9/30/2007    6/30/2007     3/31/2007    12/31/2006    9/30/2006    6/30/2006    3/31/2006    2006

Recurring capital expenditures (1) (2)

   $ 1,200,000    $ 2,765,000    $ (99,000 )   $ 367,062    $ 1,373,699    $ 233,530    $ 258,169    $ 652,438    $ 2,517,836

Non-recurring capital expenditures (2)

   $ 103,958,000    $ 99,466,000    $ 38,776,000     $ 19,249,409    $ 35,971,950    $ 10,567,130    $ 4,306,049    $ 750,817    $ 51,595,946

Total net rentable square feet at period end excluding redevelopment space

     10,527,011      10,311,857      9,713,146       9,668,267      9,381,860      9,111,904      9,132,357      8,135,957      9,381,860

Recurring capital expenditures per square foot

   $ 0.11    $ 0.27    $ (0.01 )   $ 0.04    $ 0.15    $ 0.03    $ 0.03    $ 0.08    $ 0.27

Non-recurring capital expenditures per square foot (2)

   $ 9.88    $ 9.65    $ 3.99     $ 1.99    $ 3.83    $ 1.16    $ 0.47    $ 0.09    $ 5.50

 

(1) Recurring capital expenditures represents non-incremental building improvements required to maintain current revenues. Recurring capital expenditures do not include acquisition capital that was taken into consideration when underwriting the purchase of a building or which are incurred to bring a building up to “operating standard”.
(2) Recent property acquisitions may make a period over period comparison difficult. For a list of the acquisition dates of our properties see page 17.

 

Page 25


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

Redevelopment Activity

For the quarter ended December 31, 2007

(Square feet)

 

Activity for the quarter ended September 30, 2007

  

Redevelopment Space as of September 30, 2007

   1,708,059  

Acquired Redevelopment Space and New Construction Space

   147,232  

Converted Redevelopment Space:

  

Turn-Key Datacenter™

   (80,797 )

Powered Base Building™

   (11,365 )

Remeasurement Adjustments

   (8,901 )
      

Redevelopment Space as of December 31, 2007

   1,754,228  
      

Redevelopment Space Under Construction in Quarter

  

Turn-Key Datacenter™

   533,262  

Build-to-Suit

   103,852  

New Powered Base Building™ Shell

   —    
      

Redevelopment Space Under Construction as of December 31, 2007

   637,114  
      

 

Page 26


DIGITAL REALTY TRUST, INC.

Fourth Quarter 2007

Management Statements on Non-GAAP Supplemental Measures

Funds from Operations:

We calculate Funds from Operations, or FFO, in accordance with the standards established by the National Association of Real Estate Investment Trusts, or NAREIT. FFO represents net income (loss) (computed in accordance with GAAP), excluding gains (or losses) from sales of property, real estate related depreciation and amortization (excluding amortization of deferred financing costs) and after adjustments for unconsolidated partnerships and joint ventures. Management uses FFO as a supplemental performance measure because, in excluding real estate related depreciation and amortization and gains and losses from property dispositions, it provides a performance measure that, when compared year over year, captures trends in occupancy rates, rental rates and operating costs. We also believe that, as a widely recognized measure of the performance of REITs, FFO will be used by investors as a basis to compare our operating performance with that of other REITs. However, because FFO excludes depreciation and amortization and captures neither the changes in the value of our properties that result from use or market conditions, nor the level of capital expenditures and leasing commissions necessary to maintain the operating performance of our properties, all of which have real economic effect and could materially impact our results from operations, the utility of FFO as a measure of our performance is limited. Other REITs may not calculate FFO in accordance with the NAREIT definition and, accordingly, our FFO may not be comparable to such other REITs’ FFO. Accordingly, FFO should be considered only as a supplement to net income as a measure of our performance. FFO for all periods presented in this supplemental information includes the results of properties sold in 2006 and 2007; 7979 East Tufts Avenue (July 2006), 100 Technology Center Drive (March 2007) and 4055 Valley View Lane (March 2007).

Adjusted Funds From Operations:

We present adjusted funds from operations, or AFFO, as a supplemental operating measure because, when compared year over year, it assesses our ability to fund dividend and distribution requirements from our operating activities. We also believe that, as a widely recognized measure of the operations of REITs, AFFO will be used by investors as a basis to assess our ability to fund dividend payments in comparison to other REITs. We calculate adjusted funds from operations, or AFFO, by adding to or subtracting from FFO (i) non-real estate depreciation, (ii) amortization of deferred financing costs (iii) noncash compensation (iv) loss from early extinguishment of debt (v) straight line rents (vi) fair value of lease revenue amortization (vii) capitalized leasing payroll (viii) recurring tenant improvements and (ix) capitalized leasing commissions. Other equity REITs may not calculate AFFO in a consistent manner. Accordingly, our AFFO may not be comparable to other equity REITs’ AFFO. AFFO should be considered only as a supplement to net income computed in accordance with GAAP as a measure of our performance. AFFO for all periods presented in this supplemental information includes the results of properties sold in 2006 and 2007; 7979 East Tufts Avenue (July 2006), 100 Technology Center Drive (March 2007) and 4055 Valley View Lane (March 2007).

EBITDA and Adjusted EBITDA:

We believe that earnings before interest expense, income taxes, depreciation and amortization, or EBITDA and Adjusted EBITDA (as defined below), are useful supplemental performance measures because they allow investors to view our performance without the impact of noncash depreciation and amortization or the cost of debt and with respect to Adjusted EBITDA preferred dividends and minority interests. Adjusted EBITDA is EBITDA excluding minority interests and preferred stock dividends. In addition, we believe EBITDA and adjusted EBITDA are frequently used by securities analysts, investors and other interested parties in the evaluation of REITs. Because EBITDA and adjusted EBITDA are calculated before recurring cash charges including interest expense and income taxes, and are not adjusted for capital expenditures or other recurring cash requirements of our business, their utility as a measure of our performance is limited. Accordingly, EBITDA and Adjusted EBITDA should be considered only as supplements to net income (computed in accordance with GAAP) as a measure of our financial performance. Other equity REITs may calculate EBITDA and Adjusted EBITDA differently than we do; accordingly, our EBITDA and Adjusted EBITDA may not comparable to such other REITs’ EBITDA and Adjusted EBITDA. EBITDA and Adjusted EBITDA for all periods presented in this supplemental information includes the results of properties sold in 2006 and 2007; 7979 East Tufts Avenue (July 2006), 100 Technology Center Drive (March 2007) and 4055 Valley View Lane (March 2007).

NOI and Run-rate NOI:

Net Operating Income (NOI)

NOI represents rental revenue and tenant reimbursement revenue less rental property operating and maintenance, property taxes and insurance expenses (as reflected in statement of operations). NOI is commonly used by stockholders, company management and industry analysts as a measurement of operating performance of the company’s rental portfolio. However, because NOI excludes depreciation and amortization and captures neither the changes in the value of our properties that result from use or market conditions, nor the level of capital expenditures and leasing commissions necessary to maintain the operating performance of our properties, all of which have real economic effect and could materially impact our results from operations, the utility of NOI as a measure of our performance is limited. Other REITs may not calculate NOI in the same manner we do and, accordingly, our NOI may not be comparable to such other REITs’ NOI. Accordingly, NOI should be considered only as a supplement to net income as a measure of our performance.

Run-rate NOI:

Run-rate NOI represents NOI as defined above adjusted for new acquisitions to show an estimate of NOI as if the property had been owned for the entire quarter. Run-rate NOI is commonly used by stockholders, company management and industry analysts as a measurement of future operating performance of the company’s rental portfolio. Run-rate NOI may not be indicative of future performance. Actual performance is subject to risks, uncertainties and assumptions. See the discussion of forward-looking statements on page 3.

 

Page 27