EX-99.2 3 dex992.htm SUPPLEMENTAL OPERATING AND FINANCIAL DATA POSTED JULY 30, 2009 Supplemental Operating and Financial Data posted July 30, 2009

Exhibit 99.2

LOGO


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

     PAGE

Corporate Data

  

Corporate Information

   4

Ownership Structure

   5

Consolidated Financial Information

  

Key Quarterly 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, Depreciation and Amortization and Financial Ratios

   10

Net Operating Income (NOI) and Run-rate NOI for the three months ended June 30, 2009

   11

Same Store and New Properties Consolidated Quarterly Statements of Operations

   12

Same Store Operating Trend Summary

   13

Consolidated Debt Analysis and Credit Facility

   14

Revolving Credit Facility Commitments

   15

Debt Maturities

   16

Portfolio Data

  

Portfolio Summary

   17

Properties Acquired

   18

Occupancy Analysis

   19

Major Tenants

   21

Utility Power Capacity

   22

Lease Expirations & Lease Distribution

   23

Leasing Activity

   24

Tenant Improvements and Leasing Commissions

   25

Historical Capital Expenditures

   26

Redevelopment Activity

   27

Definitions

  

Management Statements on Non-GAAP Supplemental Measures

   28

 

Page 2


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

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:

 

   

the impact of the current deterioration in global economic, credit and market conditions;

 

   

downturn of local economic conditions in our geographic markets;

 

   

decreases in information technology spending, including as a result of economic slowdowns or recession;

 

   

adverse economic or real estate developments in our industry or the industry sectors that we sell to (including risks relating to decreasing real estate valuations and impairment charges);

 

   

our dependence upon significant tenants;

 

   

bankruptcy or insolvency of a major tenant or a significant number of smaller tenants;

 

   

defaults on or non-renewal of leases by tenants;

 

   

our failure to obtain necessary debt and equity financing;

 

   

increased interest rates and operating costs;

 

   

our failure to repay debt when due or our breach of covenants or other terms contained in our loan facilities and agreements;

 

   

financial market fluctuations;

 

   

changes in foreign currency exchange rates;

 

   

our inability to manage our growth effectively;

 

   

difficulty acquiring or operating properties in foreign jurisdictions;

 

   

our failure to successfully operate acquired or redeveloped properties;

 

   

risks related to joint venture investments, including as a result of our lack of control of such investments;

 

   

delays or unexpected costs in development or redevelopment of properties;

 

   

decreased rental rates or increased vacancy rates;

 

   

increased competition or available supply of data center space;

 

   

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

 

   

difficulties in identifying properties to acquire and completing acquisitions;

 

   

our inability to acquire off-market properties;

 

   

our inability to comply with the rules and regulations applicable to public companies;

 

   

our failure to maintain our status as a REIT;

 

   

possible adverse changes to tax laws;

 

   

restrictions on our ability to engage in certain business activities;

 

   

environmental uncertainties and risks related to natural disasters;

 

   

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 report on Form 10-K for the year ended December 31, 2008, 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.

Second Quarter 2009

 

Corporate Information

Corporate Profile

Digital Realty Trust, Inc. owns, acquires, repositions and manages technology-related real estate. The Company’s 75 properties, excluding one property held as an investment in an unconsolidated joint venture and including a development in London, contain applications and operations critical to the day-to-day operations of technology industry tenants and corporate enterprise data center tenants. Comprising approximately 11.9 million net rentable square feet, including approximately 1.1 million square feet of space held for redevelopment, Digital Realty Trust’s property portfolio is located 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

David J. Caron: Senior Vice President, Portfolio Management

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    Macquarie   JMP Securities      
Steve Benyik    Nick Pirsos   William Marks      
(212) 538-0239    (212) 231-2457   (415) 835-8944      
Green Street    Oppenheimer   Citigroup    Baird   
Michael Knott    Srinivas Anantha   Michael Bilerman    David Aubuchon   
(949) 640-8780    (617) 428-5960   (212) 816-1685    (314) 863-4235   
Matthew Wokasch    Peter Armstrong   Irwin Guzman    Justin Pelham-Webb   
(949) 640-8780    (212) 667-5808   (212) 816-1685    (314) 863-6413   
RBC Capital Markets    Raymond James   KeyBanc Capital Markets    ISI   
Dave Rodgers    Paul D. Puryear   Jordan Sadler    Steve Sakwa   
(440) 715-2647    (727) 567-2253   (917) 368-2280    (212) 446-9462   
Mike Carroll    William A. Crowe   Craig Mailman    Ian Weismann   
(440) 715-2649    (727) 567-2594   (917) 368-2316    (212) 446-9461   

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):

 

     2nd Quarter
2009
    1st Quarter
2009
    4th Quarter
2008
    3rd Quarter
2008
    2nd Quarter
2008
    1st Quarter
2008
 

High Price*

   $ 39.84      $ 35.70      $ 47.62      $ 51.28      $ 43.45      $ 39.20   

Low Price*

   $ 32.14      $ 24.96      $ 18.04      $ 36.96      $ 35.43      $ 31.28   

Closing Price, end of
quarter*

   $ 35.85      $ 33.18      $ 32.85      $ 47.25      $ 40.91      $ 35.50   

Average daily trading volume*

     2,258,424        2,074,752        1,876,211        1,139,423        904,670        1,224,336   

Indicated dividend per common share**

   $ 1.320      $ 1.320      $ 1.320      $ 1.240      $ 1.240      $ 1.240   

Closing annual dividend yield, end of quarter

     3.7     4.0     4.0     2.6     3.0     3.5

Closing shares and units outstanding end of quarter***

     82,013,377        81,980,716        79,125,833        78,259,621        72,405,839        72,329,436   

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

   $ 2,940,180      $ 2,720,120      $ 2,599,284      $ 3,697,767      $ 2,962,123      $ 2,567,695   

 

* New York Stock Exchange trades only.
** On an annual basis.
*** As of June 30, 2009, the total number of shares and units includes 76,140,807 shares of common stock, 4,480,549 common units held by third parties and 1,392,021 common units, vested and unvested long-term incentive units and vested class C units held by officers and directors, and excludes all unvested class C units, all unexercised common stock options and all shares potentially issuable upon exchange of our 4.125% exchangeable senior debentures due 2026 and 5.50% exchangeable senior debentures due 2029 or upon conversion of our series C and D cumulative convertible preferred stock.

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.

Second Quarter 2009

 

Ownership Structure

As of June 30, 2009

LOGO

 

Partner

   # of Units(2)    % Ownership  

Digital Realty Trust, Inc.

   76,140,807    92.8

Cambay Tele.com, LLC(3)

   4,447,827    5.5

Wave Exchange, LLC(3)

   32,722    0.0

Directors, Executive Officers and Others

   1,392,021    1.7
           

Total

   82,013,377    100.0
           

 

  (1) Reflects limited partnership interests held by our officers and directors in the form of common units and vested and unvested long-term incentive units and excludes unvested class C units and all unexercised common stock options.
  (2) The total number of shares and units includes 76,140,807 shares of common stock, 4,480,549 common units held by third parties and 1,392,021 common units, vested and unvested long-term incentive units (including vested class C units) held by officers and directors, and excludes all unvested class C units, all unexercised common stock options and all shares potentially issuable upon exchange of our 4.125% exchangeable senior debentures due 2026 and 5.50% exchangeable senior debentures due 2029 or upon conversion of our series C and D cumulative convertible preferred stock.
  (3) These third-party contributors received the common units (along with cash and the operating partnership’s 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 584,913 common units held by the members of Cambay Tele.com, LLC.

 

Page 5


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

Key Quarterly Financial Data(1)

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

 

     For the three months ended or as of  
     30-Jun-09     31-Mar-09     31-Dec-08     30-Sep-08     30-Jun-08     31-Mar-08  

Shares and units at end of quarter

            

Common shares outstanding

     76,140,807        76,042,511        73,306,703        72,556,699        66,174,618        65,481,470   

Common units outstanding

     5,872,570        5,938,205        5,819,130        5,702,922        6,231,221        6,847,966   
                                                

Total shares and Operating Partnership units

     82,013,377        81,980,716        79,125,833        78,259,621        72,405,839        72,329,436   
                                                

Market Capitalization

            

Market value of common equity(2)

   $ 2,940,180      $ 2,720,120      $ 2,599,284      $ 3,697,767      $ 2,962,123      $ 2,567,695   

Liquidation value of preferred equity

     686,637        686,637        686,750        686,750        686,750        686,750   

Total debt at balance sheet carrying value

     1,519,506        1,439,688        1,385,074        1,283,718        1,361,172        1,190,691   
                                                

Total market capitalization including preferred equity and debt

   $ 5,146,323      $ 4,846,445      $ 4,671,108      $ 5,668,235      $ 5,010,045      $ 4,445,136   
                                                

Total debt/Total market capitalization including preferred equity and debt

     29.5     29.7     29.7     22.6     27.2     26.8

Selected Balance Sheet Data

            

Investments in real estate (before depreciation)

   $ 3,283,874      $ 3,155,062      $ 3,051,180      $ 2,905,275      $ 2,816,258      $ 2,602,166   

Total assets

     3,444,708        3,351,613        3,281,045        3,158,885        3,070,850        2,895,036   

Total liabilities

     1,773,344        1,705,537        1,705,969        1,548,110        1,623,801        1,444,294   

Selected Operating Data

            

Total operating revenues from continuing operations

   $ 155,007      $ 149,134      $ 147,106      $ 142,016      $ 123,776      $ 114,547   

Total operating expenses from continuing operations

     112,161        109,931        106,537        108,358        94,942        89,253   

Interest expense from continuing operations

     22,495        18,937        17,747        15,716        14,956        15,202   

Net income

     21,203        21,189        25,133        18,419        13,550        10,816   

Net income (loss) available to common stockholders

     10,271        10,295        13,793        7,484        3,728        2,319   

Financial Ratios

            

EBITDA(3)

   $ 82,241      $ 75,972      $ 78,766      $ 69,902      $ 58,367      $ 56,763   

Adjusted EBITDA(4)

   $ 93,173      $ 86,866      $ 90,106      $ 80,837      $ 68,823      $ 65,260   

Cash interest expense(5)

   $ 16,695      $ 21,398      $ 17,439      $ 20,116      $ 14,691      $ 20,093   

Fixed charges(6)

   $ 29,721      $ 34,505      $ 30,323      $ 32,619      $ 27,163      $ 30,737   

Debt service coverage
ratio
(7)

     5.6x        4.1x        5.2x        4.0x        4.7x        3.2x   

Fixed charge coverage
ratio
(8)

     3.1x        2.5x        3.0x        2.5x        2.5x        2.1x   

Profitability measures

            

Net income (loss) per common share - basic

   $ 0.13      $ 0.14      $ 0.19      $ 0.11      $ 0.05      $ 0.04   

Net income (loss) per common share - diluted

   $ 0.13      $ 0.14      $ 0.19      $ 0.10      $ 0.05      $ 0.03   

Funds From Operations (FFO) per diluted share and unit(9)

   $ 0.71      $ 0.70      $ 0.75      $ 0.68      $ 0.58      $ 0.57   

Adjusted Funds From Operations (AFFO) per diluted share and unit(10)

   $ 0.51      $ 0.53      $ 0.56      $ 0.56      $ 0.41      $ 0.38   

Dividends per share and common unit

   $ 0.33      $ 0.33      $ 0.33      $ 0.31      $ 0.31      $ 0.31   

Diluted FFO payout ratio(11)

     46.6     47.4     44.0     45.5     53.1     54.4

Diluted AFFO payout
ratio
(12)

     64.7     62.3     58.9     55.4     75.6     81.6

Portfolio Statistics

            

Buildings

     99        99        98        96        96        93   

Properties

     75        75        75        74        74        71   

Net rentable square feet, excluding redevelopment space

     11,854,886        11,784,573        11,387,102        11,244,657        10,977,945        10,795,795   

Square feet held for redevelopment(13)

     1,148,212        1,218,525        1,573,612        1,606,407        1,873,119        1,863,700   

Occupancy at end of
quarter
(14)

     94.8     95.1     94.9     95.2     95.2     94.7

Weighted average remaining lease term (years)(15)

     7.5        7.6        7.3        7.3        7.4        7.7   

Same store occupancy at end of quarter(14)(16)

     94.7     95.0     95.4     95.2     95.2     94.7

 

(1) Financial information for prior periods has been adjusted for the retroactive application of the following new accounting guidance adopted by the Company effective January 1, 2009: FASB APB 14-1 “Accounting for Convertible Debt Instruments That May be Settled Upon Conversion (Including Partial Cash Settlement)” and Statement of Financial Accounting Standard No.160 “Noncontrolling Interests in Consolidated Financial Statements - An Amendment of ARB No. 51”.
(2) 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 common units and vested and unvested long-term incentive units (including vested class C 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 unvested class C units and all shares potentially issuable upon exchange of our 4.125% exchangeable senior debentures due 2026 and 5.50% exchangeable senior debentures due 2029 or upon conversion of our series C and D cumulative convertible preferred stock.
(3) EBITDA is calculated as earnings before interest, taxes, depreciation and amortization. For a discussion of EBITDA, see page 28. For a reconciliation of net income available to common stockholders to EBITDA, see page 10.
(4) Adjusted EBITDA is EBITDA adjusted for preferred dividends and minority interests. For a discussion of Adjusted EBITDA, see page 28. For a reconciliation of net income available to common stockholders to Adjusted EBITDA, see page 10.
(5) Cash interest expense is interest expense per our statement of operations (including interest expense on discontinued operations) less amortization of debt discount and deferred financing fees and includes interest that we capitalized. For a reconciliation of GAAP interest expense to cash interest expense see page 10.
(6) Fixed charges consist of cash interest expense, scheduled debt principal payments and preferred dividends.
(7) Debt service coverage ratio is Adjusted EBITDA divided by cash interest expense.
(8) Fixed charge coverage ratio is Adjusted EBITDA divided by fixed charges.
(9) For a definition and discussion of FFO see page 28. For a reconciliation of net income available to common stockholders to FFO, see page 9.
(10) For a definition and discussion of AFFO, see page 28. For a reconciliation of FFO to AFFO, see page 9.
(11) Diluted FFO payout ratio is dividends declared per common share and unit divided by diluted FFO per share and unit.
(12) Diluted AFFO payout ratio is dividends declared per common share and unit divided by diluted AFFO per share and unit.
(13) 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.
(14) Occupancy and same store occupancy excludes space held for redevelopment.
(15) Average remaining lease term excludes renewal options, weighted by net rentable square feet.
(16) Same store properties were acquired before December 31, 2007.

 

Page 6


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

Consolidated Balance Sheets(1)

(Dollars in thousands, except share data)

 

     June 30,
2009
    December 31,
2008
 
     (unaudited)        

ASSETS

    

Investments in real estate

    

Land

   $ 341,719      $ 316,318   

Acquired ground leases

     2,742        2,733   

Buildings and improvements

     2,666,148        2,467,830   

Tenant improvements

     264,927        255,818   
                

Investments in real estate

     3,275,536        3,042,699   

Accumulated depreciation and amortization

     (378,523     (302,960
                

Net investments in properties

     2,897,013        2,739,739   

Investment in unconsolidated joint venture

     8,338        8,481   
                

Net investments in real estate

     2,905,351        2,748,220   

Cash and cash equivalents

     69,316        73,334   

Accounts and other receivables, net

     40,195        39,108   

Deferred rent

     122,823        99,957   

Acquired above market leases, net

     28,503        31,352   

Acquired in place lease value and deferred leasing costs, net

     215,597        222,389   

Deferred financing costs, net

     21,938        16,275   

Restricted cash

     30,676        45,470   

Other assets

     10,309        4,940   
                

Total Assets

   $ 3,444,708      $ 3,281,045   
                

LIABILITIES AND EQUITY

    

Revolving credit facility

   $ 32,668      $ 138,579   

Unsecured senior notes

     83,000        58,000   

Mortgage loans

     973,604        1,026,594   

4.125% exchangeable senior debentures due 2026

     163,834        161,901   

5.50% exchangeable senior debentures due 2029

     266,400        —     

Accounts payable and other accrued liabilities

     127,279        171,176   

Accrued dividends and distributions

     —          26,092   

Acquired below market leases, net

     69,840        76,660   

Security deposits and prepaid rents

     56,719        46,967   
                

Total Liabilities

     1,773,344        1,705,969   
                

Commitments and contingencies

     —          —     

EQUITY:

    

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), 6,999,995 issued and outstanding

     169,067        169,068   

Series D Cumulative Convertible Preferred Stock, 5.500%, $345,000,000 liquidation preference ($25.00 per share), 13,795,500 issued and outstanding

     333,472        333,581   

Common Stock; $0.01 par value: 125,000,000 authorized, 76,140,807 and 73,306,703 shares issued and outstanding as of June 30, 2009 and December 31, 2008, respectively

     759        732   

Additional paid-in capital

     1,145,807        1,057,990   

Dividends in excess of earnings

     (196,500     (167,746

Accumulated other comprehensive income, net

     (27,456     (49,503
                

Total stockholders’ equity

     1,584,948        1,503,921   
                

Noncontrolling interests:

    

Noncontrolling interest in operating partnership

     65,600        66,797   

Noncontrolling interest in consolidated joint venture

     20,816        4,358   
                

Total noncontrolling interests

     86,416        71,155   
                

Total Equity

     1,671,364        1,575,076   
                

Total Liabilities and Equity

   $ 3,444,708      $ 3,281,045   
                

 

(1) Results for all periods have been adjusted for the retroactive application of the new accounting pronouncements adopted by the Company on January 1, 2009 (see footnote 1 on page 6).

 

Page 7


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

Consolidated Quarterly Statements of Operations(1)

(unaudited and in thousands, except share data)

 

     Three Months Ended  
     30-Jun-09     31-Mar-09     31-Dec-08     30-Sep-08     30-Jun-08     31-Mar-08  

Rental

   $ 125,380      $ 118,089      $ 111,398      $ 102,449      $ 97,966      $ 92,746   

Tenant reimbursements

     29,544        31,027        30,136        29,882        25,698        21,787   

Other

     83        18        5,572        9,685        112        14   
                                                

Total operating revenues

     155,007        149,134        147,106        142,016        123,776        114,547   
                                                

Rental property operating and maintenance

     42,301        42,573        43,664        39,859        35,943        31,681   

Property taxes

     9,149        9,211        5,767        8,689        8,522        8,124   

Insurance

     1,488        1,456        1,333        1,252        1,198        1,205   

Depreciation and amortization

     49,183        46,304        47,086        46,548        39,591        39,153   

General and administrative

     10,040        10,102        8,661        11,261        9,686        8,783   

Other

     —          285        26        749        2        307   
                                                

Total operating expenses

     112,161        109,931        106,537        108,358        94,942        89,253   
                                                

Operating income

     42,846        39,203        40,569        33,658        28,834        25,294   

Equity in earnings of unconsolidated joint venture

     741        1,116        1,860        178        173        158   

Interest and other income

     403        243        591        453        407        655   

Interest expense

     (22,495     (18,937     (17,747     (15,716     (14,956     (15,202

Tax expense

     (292     (436     (140     (154     (726     (89

Loss from early extinguishment of debt

     —          —          —          —          (182     —     
                                                

Net Income

     21,203        21,189        25,133        18,419        13,550        10,816   

Net Income attributable to noncontrolling interest

     (831     (793     (1,238     (833     (354     (239
                                                

Net Income Attributable to Digital Realty Trust, Inc.

     20,372        20,396        23,895        17,586        13,196        10,577   

Preferred stock dividends

     (10,101     (10,101     (10,102     (10,102     (10,102     (8,258
                                                

Net income available to common stockholders

   $ 10,271      $ 10,295      $ 13,793      $ 7,484      $ 3,094      $ 2,319   
                                                

Net income per share available to common stockholders - basic

   $ 0.13      $ 0.14      $ 0.19      $ 0.11      $ 0.05      $ 0.04   

Net income per share available to common stockholders - diluted

   $ 0.13      $ 0.14      $ 0.19      $ 0.10      $ 0.05      $ 0.03   

Weighted-average shares outstanding - basic

     76,121,380        74,703,755        73,011,453        70,916,019        65,889,122        65,431,586   

Weighted-average shares outstanding - diluted

     76,851,202        74,895,168        73,205,628        73,338,871        68,068,600        67,142,783   

Weighted-average fully diluted shares and units

     82,728,389        80,741,438        79,289,939        79,376,123        74,533,055        73,886,689   

 

(1) Results for all periods have been adjusted for the retroactive application of the new accounting pronouncements adopted by the Company on January 1, 2009 (see footnote 1 on page 6).

 

Page 8


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

Funds From Operations (FFO)(1)

(unaudited and in thousands except per share data)

 

     Three Months Ended  
     30-Jun-09     31-Mar-09     31-Dec-08     30-Sep-08     30-Jun-08     31-Mar-08  

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

            

Net income available to common stockholders

   $ 10,271      $ 10,295      $ 13,793      $ 7,484      $ 3,094      $ 2,319   

Adjustments:

            

Net Income attributable to noncontrolling interest

     831        793        1,238        833        354        239   

Real estate related depreciation and amortization(2)

     48,900        46,087        46,890        46,359        39,414        38,994   

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

     858        646        (286     859        872        894   
                                                

FFO available to common stockholders and unitholders

   $ 60,860      $ 57,821      $ 61,635      $ 55,535      $ 43,734      $ 42,446   
                                                

FFO per share and unit:

            

Basic

   $ 0.74      $ 0.72      $ 0.78      $ 0.72      $ 0.60      $ 0.59   

Diluted(3)

   $ 0.71      $ 0.70      $ 0.75      $ 0.68      $ 0.58      $ 0.57   
                                                

Weighted-average shares and units outstanding - basic

     81,999        80,550        79,096        76,953        72,354        72,175   

Weighted-average shares and units outstanding - diluted(3)

     99,461        92,571        91,123        91,209        86,366        82,524   

 

(1)     Results for all periods have been adjusted for the retroactive application of the new accounting pronouncements adopted by the Company on January 1, 2009 (see footnote 1 on page 6).

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

        

       

Depreciation and amortization per income statement

   $ 49,183      $ 46,304      $ 47,086      $ 46,548      $ 39,591      $ 39,153   

Non-real estate depreciation

     (283     (217     (196     (189     (177     (159
                                                
   $ 48,900      $ 46,087      $ 46,890      $ 46,359      $ 39,414      $ 38,994   
                                                

(3)     At June 30, 2009, we had 6,999,955 series C convertible preferred shares and 13,795,500 series D convertible preferred shares outstanding that were convertible into 3,614,777 common shares and 8,215,221 common shares, respectively. In addition, we had a balance of $266,400 of 5.50% exchangeable senior debentures that were exchangeable for 4,901,812 common shares on a weighted average basis for the three months ended June 30, 2009. See below for calculations of diluted FFO available to common stockholders and unitholders and weighted average common stock and units outstanding.

           

FFO available to common stockholders and unitholders

   $ 60,860      $ 57,821      $ 61,635      $ 55,535      $ 43,734      $ 42,446   

Add: Series C convertible preferred dividends

     1,914        1,914        1,914        1,914        1,914        1,914   

Add: Series D convertible preferred dividends

     4,742        4,742        4,744        4,744        4,744        2,899   

Add: 5.50% exchangeable senior debentures interest

     2,890        —          —          —          —          —     
                                                

FFO available to common stockholders and unitholders — diluted

   $ 70,406      $ 64,477      $ 68,293      $ 62,193      $ 50,392      $ 47,259   
                                                

Weighted average common stock and units outstanding

     81,999        80,550        79,096        76,953        72,354        72,175   

Add: Effect of dilutive securities (excluding series C and D convertible preferred stock)

     730        191        194        2,423        2,179        1,712   

Add: Effect of dilutive series C convertible preferred stock

     3,615        3,615        3,615        3,615        3,615        3,615   

Add: Effect of dilutive series D convertible preferred stock

     8,215        8,215        8,218        8,218        8,218        5,022   

Add: Effect of dilutive 5.50% exchangeable senior debentures

     4,902        —          —          —          —          —     
                                                

Weighted average common stock and units outstanding — diluted

     99,461        92,571        91,123        91,209        86,366        82,524   
                                                

Note: For a definition and discussion of FFO, see page 28.

Adjusted Funds From Operations (AFFO)(1)

(unaudited and in thousands)

 

     Three Months Ended  
     30-Jun-09     31-Mar-09     31-Dec-08     30-Sep-08     30-Jun-08     31-Mar-08  

Reconciliation of FFO to AFFO:

            

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

   $ 60,860      $ 57,821      $ 61,635      $ 55,535      $ 43,734      $ 42,446   

Adjustments:

            

Non-real estate depreciation

     283        217        196        189        177        159   

Amortization of deferred financing costs

     1,896        1,662        1,599        1,524        1,411        1,398   

Amortization of debt discount

     974        959        943        927        911        896   

Non-cash compensation

     2,130        1,520        1,663        3,174        1,582        1,220   

Loss from early extinguishment of debt

     —          —          —          —          182        —     

Straight line rents

     (11,089     (11,308     (11,036     (8,301     (8,899     (7,771

Above and below market rent amortization

     (2,118     (2,139     (1,971     (2,081     (2,525     (2,685

Capitalized leasing compensation

     (1,414     (1,271     (1,008     (1,009     (974     (1,045

Recurring capital expenditures and tenant improvements

     (7,161     (496     (3,031     (1,730     (3,699     (2,868

Capitalized leasing commissions

     (2,467     (4,283     (4,349     (3,759     (1,259     (3,936
                                                

AFFO available to common stockholders and unitholders

   $ 41,894      $ 42,682      $ 44,641      $ 44,469      $ 30,641      $ 27,814   
                                                

 

(1) Results for all periods have been adjusted for the retroactive application of the new accounting pronouncements adopted by the Company on January 1, 2009 (see footnote 1 on page 6).

Note: For a definition and discussion of AFFO, see page 28. For a reconciliation of net income available to common stockholders to FFO, see above table.

 

Page 9


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

Reconciliation of Earnings before interest, taxes, depreciation and amortization (EBITDA)(1)(2)

(unaudited and in thousands)

 

     Three Months Ended  
     30-Jun-09     31-Mar-09     31-Dec-08     30-Sep-08     30-Jun-08     31-Mar-08  

Net income available to common stockholders

   $ 10,271      $ 10,295      $ 13,793      $ 7,484      $ 3,094      $ 2,319   

Interest

     22,495        18,937        17,747        15,716        14,956        15,202   

Taxes

     292        436        140        154        726        89   

Depreciation and amortization

     49,183        46,304        47,086        46,548        39,591        39,153   
                                                

EBITDA

     82,241        75,972        78,766        69,902        58,367        56,763   

Noncontrolling interest

     831        793        1,238        833        354        239   

Preferred stock dividends

     10,101        10,101        10,102        10,102        10,102        8,258   
                                                

Adjusted EBITDA

   $ 93,173      $ 86,866      $ 90,106      $ 80,837      $ 68,823      $ 65,260   
                                                

 

(1)     For the definition and discussion of EBITDA and Adjusted EBITDA, see page 28.

(2)     Results for all periods have been adjusted for the retroactive application of the new accounting pronouncements adopted by the Company on January 1, 2009 (see footnote 1 on page 6).

       

        

Financial Ratios(1)

            

(unaudited and in thousands)

            
     30-Jun-09     31-Mar-09     31-Dec-08     30-Sep-08     30-Jun-08     31-Mar-08  

Total GAAP interest expense

     22,495        18,937        17,747        15,716        14,956        15,202   

Capitalized interest

     2,147        3,072        4,305        4,630        4,708        4,708   

Change in accrued interest and other noncash amounts

     (7,947     (611     (4,613     (230     (4,973     183   
                                                

Cash interest expense(a)

     16,695        21,398        17,439        20,116        14,691        20,093   

Scheduled debt principal payments and preferred dividends

     13,026        13,107        12,884        12,503        12,472        10,644   
                                                

Total fixed charges(b)

     29,721        34,505        30,323        32,619        27,163        30,737   
                                                

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

     4.1x        4.6x        5.1x        5.1x        4.6x        4.3x   

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

     5.6x        4.1x        5.2x        4.0x        4.7x        3.2x   

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

     2.6x        2.7x        2.9x        2.9x        2.5x        2.5x   

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

     3.1x        2.5x        3.0x        2.5x        2.5x        2.1x   

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

     29.5     29.7     29.7     22.6     27.2     26.8

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

     42.9     43.9     44.4     34.8     40.9     42.2

Pretax income to interest expense(g)

     1.9x        2.1x        2.4x        2.2x        1.9x        1.7x   

Net Debt to Adjusted EBITDA(h)

     3.9x        3.9x        3.6x        3.8x        4.9x        4.4x   

 

(a) Cash interest expense is interest expense less amortization of debt discount and 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) For a definition of Fixed Charges see page 6.
(c) Adjusted EBITDA divided by interest expense.
(d) Adjusted EBITDA divided by fixed charges. Fixed charges include interest expense as per (a) above and scheduled debt principal payments and preferred dividends.
(e) 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.
(f) Same as (e), except numerator includes preferred stock.
(g) Calculated as income including gain on sale of assets before minority interest and interest divided by GAAP interest expense.
(h) Calculated as total debt at balance sheet carrying value (see page 6) less cash and cash equivalents divided by Adjusted EBITDA multiplied by four.
(1) Results for all periods have been adjusted for the retroactive application of the new accounting pronouncements adopted by the Company on January 1, 2009 (see footnote 1 on page 6).

 

Page 10


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

Net Operating Income (NOI) and Run-rate NOI

For the three months ended June 30, 2009

(unaudited and in thousands)

 

Rental revenues

   $ 125,380   

Tenant reimbursements

     29,544   

Rental property operating and maintenance

     (42,301

Property taxes

     (9,149

Insurance

     (1,488
        

NOI

   $ 101,986   

Actual results of properties acquired during the quarter:

  

Rental revenues

     —     

Tenant reimbursements

     —     

Rental property operating and maintenance

     —     

Property taxes

     —     

Insurance

     —     

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

  

Rental revenues

     —     

Tenant reimbursements

     —     

Rental property operating and maintenance

     —     

Property taxes

     —     

Insurance

     —     
        

Run-rate NOI

   $ 101,986   
        

Reconciliation of net income available to common stockholders to NOI

  

Net income available to common stockholders

   $ 10,271   

Other revenues

     (83

Interest expense

     22,495   

Depreciation and amortization

     49,183   

General and administrative expenses

     10,040   

Tax expense

     292   

Equity in earnings of unconsolidated joint venture

     (741

Interest and other income

     (403

Net Income attributable to noncontrolling interest

     831   

Preferred stock dividends

     10,101   
        

NOI

   $ 101,986   
        

Note: For a definition and discussion of NOI and Run-rate NOI, see page 28.

 

Page 11


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

Same Store and New Properties Consolidated Quarterly Statements of Operations(1)

(unaudited and in thousands)

 

                 Three Months Ended  
     30-Jun-09     31-Mar-09     31-Dec-08     30-Sep-08     30-Jun-08     31-Mar-08  

Same store(2)

            

Operating Revenues:

            

Rental

   $ 122,415      $ 115,993      $ 110,692      $ 101,575      $ 97,892      $ 92,746   

Tenant reimbursements

     28,444        29,919        28,507        29,878        25,698        21,787   

Other

     83        18        5,572        9,685        112        14   
                                                

Total operating revenues

     150,942        145,930        144,771        141,138        123,702        114,547   
                                                

Operating Expenses:

            

Rental property operating and maintenance

     40,435        41,094        41,764        39,802        35,931        31,624   

Property taxes

     8,986        9,107        5,723        8,650        8,521        8,124   

Insurance

     1,463        1,439        1,325        1,246        1,198        1,205   

Depreciation and amortization

     48,092        45,460        46,794        46,227        39,591        39,153   

General and administrative(3)

     10,040        10,102        8,661        11,261        9,686        8,783   

Other

     —          285        26        749        2        307   
                                                

Total operating expenses

     109,016        107,487        104,293        107,935        94,929        89,196   

Operating income

     41,926        38,443        40,478        33,203        28,773        25,351   

Other Income (Expenses):

            

Equity in earnings of unconsolidated joint venture

     741        1,116        1,860        178        173        158   

Interest and other income

     402        242        589        452        405        655   

Interest expense(4)

     (22,459     (18,937     (17,747     (15,716     (14,954     (15,202

Tax expense

     (314     (434     (140     (154     (726     (89

Loss from early extinguishment of debt

     —          —          —          —          (182     —     
                                                

Net Income

   $ 20,296      $ 20,430      $ 25,040      $ 17,963      $ 13,489      $ 10,873   

New properties(2)

            

Operating Revenues:

            

Rental

   $ 2,965      $ 2,096      $ 706      $ 874      $ 74      $ —     

Tenant reimbursements

     1,100        1,108        1,629        4        —          —     

Other

     —          —          —          —          —          —     
                                                

Total operating revenues

     4,065        3,204        2,335        878        74        —     
                                                

Operating Expenses:

            

Rental property operating and maintenance

     1,866        1,479        1,900        57        12        57   

Property taxes

     163        104        44        39        1        —     

Insurance

     25        17        8        6        —          —     

Depreciation and amortization

     1,091        844        292        321        —          —     

General and administrative(3)

     —          —          —          —          —          —     

Other

     —          —          —          —          —          —     
                                                

Total operating expenses

     3,145        2,444        2,244        423        13        57   
                                                

Operating income

     920        760        91        455        61        (57

Other Income (Expenses):

            

Equity in earnings of unconsolidated joint venture

     —          —          —          —          —          —     

Interest and other income

     1        1        2        1        2        —     

Interest expense(4)

     (36     —          —          —          (2     —     

Income tax expense

     22        (2     —          —          —          —     

Loss from early extinguishment of debt

     —          —          —          —          —          —     
                                                

Net Income

   $ 907      $ 759      $ 93      $ 456      $ 61      $ (57

 

(1) Results for all periods have been adjusted for the retroactive application of the new accounting pronouncements adopted by the Company on January 1, 2009 (see footnote 1 on page 6).
(2) Same store properties are properties that were acquired on or before December 31, 2007 and new properties are properties acquired after December 31, 2007.
(3) General and administrative expenses are included entirely in same store as they are not allocable to specific properties.
(4) Interest expense on our revolving credit facility is allocated entirely to same store properties.

 

Page 12


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

Same Store Operating Trend Summary(1)

(unaudited and in thousands, except share data)

 

     Three Months Ended  
     30-Jun-09     31-Mar-09     Percentage
Change
    30-Jun-08     Percentage
Change
 

Same store(2)

          

Rental(3)

   $ 122,415      $ 115,993      5.5   $ 97,892      25.1

Tenant reimbursements

     28,444        29,919      (4.9 )%      25,698      10.7
                                    
     150,859        145,912      3.4     123,590      22.1

Rental property operating and maintenance

     40,435        41,094      (1.6 )%      35,931      12.5

Property taxes

     8,986        9,107      (1.3 )%      8,521      5.5

Insurance

     1,463        1,439      1.7     1,198      22.1
                                    
     50,884        51,640      (1.5 )%      45,650      11.5
                                    

Net Operating Income(4)

   $ 99,975      $ 94,272      6.0   $ 77,940      28.3
                                    

Same store occupancy at end of quarter

     94.7     95.0       95.2  
                            

 

(1) Results for all periods have been adjusted for the retroactive application of the new accounting pronouncements adopted by the Company on January 1, 2009. (See footnote 1 on page 6).
(2) Same store properties were acquired on or before December 31, 2007.
(3) For the periods presented, same store straight-line rent was $10,479, $11,020 and $8,899, respectively, and non-cash adjustments related to FAS 141 were $2,092, $2,115 and $2,525, respectively.
(4) For a definition and discussion of Net Operating Income, see page 28.

 

Page 13


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

Consolidated Debt Analysis

(unaudited, in thousands)

 

   

Maturity Date

  Principal
Balance as of
June 30, 2009
    % of Debt     Interest Rate as
of June 30,

2009
    Interest Rate as
of June 30,
2009

including
swaps
 

Unhedged Floating Rate Debt

         

Revolving credit facility

  August 31, 2012(1)     32,668      2.2   1.55   —     
                   
    $ 32,668      2.2    

Fixed Rate Mortgage Debt and Hedged Floating Rate Debt

         

Secured Term Debt

  November 11, 2014     145,288      9.7   5.65   —     

3 Corporate Place

  August 1, 2013(1)     80,000      5.3   6.72   —     

200 Paul Avenue 1-4

  October 8, 2015     78,574      5.2   5.74   —     

2045 & 2055 LaFayette Street

  February 6, 2017     67,664      4.5   5.93   —     

Mundells Roundabout

  November 30, 2013     70,503      4.6   1.95   4.18

600 West Seventh Street

  March 15, 2016     56,179      3.7   5.80   —     

2323 Bryan Street

  November 6, 2009     54,629      3.6   6.04   —     

34551 Ardenwood Boulevard 1-4

  November 11, 2016     55,000      3.6   5.95   —     

1100 Space Park Drive

  December 11, 2016     55,000      3.6   5.89   —     

150 South First Street

  February 6, 2017     53,044      3.5   6.30   —     

114 Rue Ambroise Croizat

  January 18, 2012     44,528      2.9   2.54   5.13

1500 Space Park Drive

  October 5, 2013     42,806      2.8   6.15   —     

2334 Lundy Place

  November 11, 2016     40,000      2.6   5.96   —     

Unit 9, Blanchardstown Corporate Park

  January 18, 2012     38,284      2.5   2.54   5.35

6 Braham Street

  April 10, 2011     21,566      1.4   2.00   5.84

1201 Comstock Street

  June 24, 2013(1)     18,100      1.2   3.81   —     

Paul van Vlissingenstraat 16

  July 18, 2013     15,028      1.0   2.79   5.58

Chemin de l’Epinglier 2

  July 18, 2013     10,914      0.7   2.69   5.57

1125 Energy Park Drive

  March 1, 2032     9,270      0.6   7.62   —     

Gyroscoopweg 2E-2F

  October 18, 2013     9,567      0.6   2.69   5.49

731 East Trade Street

  July 1, 2020     5,419      0.4   8.22   —     
                   
    $ 971,363      64.0    

4.125 % exchangeable senior debentures due 2026

  August 15, 2026     172,500      11.4   6.75   —     

5.50% exchangeable senior debentures due 2029

  April 15, 2029     266,400      17.5   5.50  

Unsecured senior notes — Series A

  July 24, 2011     25,000      1.6   7.00   —     

Unsecured senior notes — Series B

  November 5, 2013     33,000      2.2   9.32   —     

Unsecured senior notes — Series C

  January 6, 2016     25,000      1.6   9.68   —     

Total Fixed Rate Debt Including Swaps

    $ 1,493,263      98.3    

Unamortized discount on 4.125% exchangeable senior debentures due 2026

      (8,666   (0.6 )%     

Unamortized Loan premium — 1125 Energy Park Drive, 731 East Trade Street and 1500 Space Park Drive mortgages

      2,241      0.1    
                   

Total Consolidated Debt

    $ 1,519,506      100.0    
                   

Weighted average cost of debt (including interest rate swaps)

          5.89
             

 

(1) Assumes all extensions will be exercised.

Credit Facility

(in thousands)

 

     Maximum Available as
of June 30, 2009
   Available as
of June 30, 2009
   Drawn as
of June 30, 2009

Revolving Credit Facility

   $ 720,000    $ 673,500    $ 32,668

 

Page 14


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

REVOLVING CREDIT FACILITY COMMITMENTS

(Dollar amounts in thousands)

 

     

Lender / Issuing Bank

   Amount
Committed

1

   Citicorp North America, Inc.    $ 85,000

2

   KeyBank, N.A.      85,000

3

   Bank of America, N.A.(1)      70,000

4

   The Royal Bank of Scotland PlC      70,000

5

   Deutsche Bank      70,000

6

   Merrill Lynch Capital Corporation(1)      60,000

7

   Sovereign Bank      50,000

8

   Raymond James Bank, FSB      50,000

9

   Royal Bank of Canada, New York Branch      40,000

10

   Credit Suisse, Cayman Islands Branch      25,000

11

   Société Générale      25,000

12

   UBS Loan Finance LLC      25,000

13

   Allied Irish Banks, p.l.c.      15,000

14

   Chang Hwa Commercial Bank, Ltd., New York Branch      15,000

15

   Mega International Commercial Bank Co., Ltd Los Angeles Branch      15,000

16

   Comerica Bank      10,000

17

   First Commercial Bank New York Agency      10,000
   Total Commitments - Revolving Credit Facility    $ 720,000

 

(1) On January 1, 2009, Bank of America Corporation acquired Merrill Lynch & Co., Inc.

Note: The revolving credit facility has a $485.0 million sub-facility for multi-currency advances.

 

Page 15


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

Debt Maturities

(unaudited, in thousands)

 

Property

   2009    2010    2011    2012    2013    Thereafter    Total

Revolving credit facility(1)

   $ —      $ —      $ —      $ 32,668    $ —      $ —      $ 32,668

Secured Term Debt(2)

     1,210      2,550      2,700      2,836      3,026      132,966      145,288

3 Corporate Place(1)

     —        —        —        —        80,000      —        80,000

200 Paul Avenue 1-4

     771      1,624      1,721      1,812      1,932      70,714      78,574

2045 & 2055 LaFayette Street

     393      835      886      941      999      63,610      67,664

600 West Seventh Street

     654      1,367      1,448      1,535      1,626      49,549      56,179

2323 Bryan Street(3)

     54,629      —        —        —        —        —        54,629

1100 Space Park Drive

     56      648      687      720      774      52,115      55,000

34551 Ardenwood Boulevard 1-4

     55      639      678      711      766      52,151      55,000

150 South First Street

     284      596      635      677      723      50,129      53,044

114 Rue Ambroise Croizat

     346      691      691      42,800      —        —        44,528

1500 Space Park Drive

     923      1,942      2,067      2,192      35,682      —        42,806

Mundells Roundabout

     —        —        —        —        70,503      —        70,503

2334 Lundy Place

     40      464      493      517      556      37,930      40,000

Unit 9, Blanchardstown Corporate Park

     297      594      594      36,799      —        —        38,284

Unsecured senior notes

     —        —        25,000      —        33,000      25,000      83,000

6 Braham Street

     329      659      20,578      —        —        —        21,566

1201 Comstock Street(1)

     363      762      812      867      15,296      —        18,100

Paul van Vlissingenstraat 16

     118      236      236      236      14,202      —        15,028

Chemin de l’Epinglier 2

     85      170      170      170      10,319      —        10,914

Gyroscoopweg 2E-2F

     75      150      150      150      9,042      —        9,567

1125 Energy Park Drive

     66      143      154      165      180      8,562      9,270

731 East Trade Street

     104      235      274      297      323      4,186      5,419

4.125 % exchangeable senior debentures due
2026
(4)

     —        —        172,500      —        —        —        172,500

5.50% exchangeable senior debentures due 2029(5)

     —        —        —        —        —        266,400      266,400
                                                

Total

   $ 60,798    $ 14,305    $ 232,474    $ 126,093    $ 278,949    $ 813,312    $ 1,525,931
                                                

Weighted Average Term to Initial Maturity(4)(5)

        4.7 Years               

Weighted Average Term to Initial Maturity (assuming exercise of extension options)(4)(5)

        4.8 Years               

 

(1) Assumes all extensions will be exercised.
(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 is cross-collateralized by the six properties.
(3) Loan is to be paid in full in August 2009.
(4) Assumes maturity of 4.125% exchangeable senior debentures due 2026 at first redemption date in August 2011.
(5) Assumes maturity of 5.50% exchangeable senior debentures due 2029 at first redemption date in April 2014.

Note: Total excludes $2,241 of loan premiums and ($8,666) of debt discount on 4.125% exchangeable senior debentures due 2026.

 

Page 16


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

Portfolio Summary

As of June 30, 2009

 

     6/30/2009     3/31/2009  

Number of Properties:

    

Domestic

   61      61   

International

   14      14   
            
   75 (1)    75 (1) 

Number of Buildings:

    

Domestic

   81      81   

International

   18      18   
            
   99      99   

Number of Markets:

    

Domestic

   20      20   

International

   7      7   
            
   27      27   

Net Rentable Square Feet:

    

Domestic

   10,673,413      10,603,100   

International

   1,181,473      1,181,473   
            
   11,854,886      11,784,573   

Redevelopment Square Feet:

    

Domestic

   925,999      996,312   

International

   222,213      222,213   
            
   1,148,212      1,218,525   

Portfolio Occupancy(2)

   94.8   95.1

Same Store Pool Occupancy(2)

   94.7   95.0

Average Original Lease Term (years)

   13.7      13.6   

Average Remaining Lease Term (years)

   7.5      7.6   

Lease Expirations (through 2010)

   8.2   9.6

 

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

 

Page 17


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

Properties Acquired

For the three months ended June 30, 2009

 

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

Loudoun Exchange II(1)

   Northern Virginia    May-09    $ 20.3    —      —      —  
                           

 

(1) Represents developable land which is not included in our operating property count.

 

Page 18


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

Occupancy Analysis

As of June 30, 2009

(Dollar amounts in thousands)

 

                    Annualized
Rent
($000)(1)
  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
    As of
06/30/09
    As of
03/31/09
    As of
12/31/08
    As of
09/30/08
    Property
Type
    Total
Portfolio
    Property
Type
    Total
Portfolio
 

Internet Gateway Datacenters

                         

350 East Cermak Road

  May-05   Chicago   1,075,851   57,888   46,532   90.6   94.0   96.0   97.0   28.1   9.1   26.4   10.5

200 Paul Avenue 1-4

  Nov-04   San Francisco   436,299   91,381   23,059   99.9   95.1   100.0   100.0   11.4      3.7      13.1      5.2   

120 E. Van Buren Street

  Jul-06   Phoenix   249,425   38,089   19,291   91.7   91.7   91.7   93.8   6.5      2.1      11.0      4.4   

600 West Seventh Street

  May-04   Los Angeles   482,089   7,633   16,668   94.1   94.6   94.6   94.6   12.6      4.1      9.5      3.8   

111 Eighth Avenue(3)

  Mar-07   New York   116,843   —     14,980   100.0   100.0   100.0   100.0   3.1      1.0      8.5      3.4   

2323 Bryan Street

  Jan-02   Dallas   457,217   19,890   14,047   76.4   77.1   77.0   77.3   11.9      3.8      8.0      3.2   

114 Rue Ambroise Croizat

  Dec-06   Paris, France   261,317   90,829   13,740   99.3   99.1   95.4   100.0   6.8      2.2      7.8      3.1   

1100 Space Park Drive

  Nov-04   Silicon Valley   165,297   —     7,595   100.0   99.1   99.1   99.1   4.3      1.4      4.3      1.7   

36 NE 2nd Street

  Jan-02   Miami   162,140   —     4,940   95.9   95.9   95.9   95.9   4.2      1.4      2.8      1.1   

600-780 S. Federal

  Sep-05   Chicago   161,547   —     4,670   69.4   69.4   81.9   78.5   4.2      1.4      2.6      1.1   

900 Walnut Street

  Aug-07   St Louis   112,266   —     3,703   97.3   93.5   93.5   93.5   2.9      0.9      2.1      0.8   

6 Braham Street

  Jul-02   London, England   63,233   —     3,655   100.0   100.0   100.0   100.0   1.7      0.5      2.1      0.8   

125 North Myers

  Aug-05   Charlotte   25,402   —     1,239   100.0   100.0   100.0   100.0   0.7      0.2      0.7      0.3   

731 East Trade Street

  Aug-05   Charlotte   40,879   —     1,200   100.0   100.0   100.0   100.0   1.1      0.3      0.7      0.3   

113 North Myers

  Aug-05   Charlotte   20,086   9,132   719   100.0   100.0   100.0   100.0   0.5      0.2      0.4      0.2   
                                                               
      3,829,891   314,842   176,038   91.7   92.0   93.4   94.0   100.0   32.3   100.0   39.9

Corporate Datacenters

                         

43881 Devon Shafron Drive

  Mar-07   Northern Virginia   179,100   900   17,321   99.0   83.5   100.0   79.1   2.7   1.5   7.3   3.9

300 Boulevard East

  Nov-02   New York   311,950   —     13,559   100.0   100.0   100.0   100.0   4.6      2.6      5.7      3.1   

3 Corporate Place

  Dec-05   New York   276,162   769   13,447   93.7   89.5   89.5   89.5   4.1      2.3      5.7      3.1   

833 Chestnut Street

  Mar-05   Philadelphia   588,770   65,988   11,849   89.5   87.9   87.7   87.4   8.7      5.0      5.0      2.7   

43791 Devon Shafron Drive

  Mar-07   Northern Virginia   132,806   2,194   9,752   100.0   100.0   100.0   0.0   2.0      1.1      4.1      2.2   

2440 Marsh Lane

  Jan-03   Dallas   116,513   18,737   9,109   77.6   60.0   70.9   100.0   1.7      1.0      3.9      2.1   

Clonshaugh Industrial Estate (Land)

  Feb-06   Dublin, Ireland   124,500   —     8,930   100.0   100.0   100.0   100.0   1.9      1.0      3.8      2.0   

Unit 9, Blanchardstown Corporate Park

  Dec-06   Dublin, Ireland   120,000   —     8,519   86.2   95.0   87.3   93.3   1.8      1.0      3.6      1.9   

1500 Space Park Drive

  Sep-07   Silicon Valley   51,615   —     8,285   100.0   100.0   100.0   100.0   0.8      0.4      3.5      1.9   

4025 Midway Road

  Jan-06   Dallas   87,964   12,626   8,158   99.8   99.8   99.8   98.6   1.3      0.7      3.5      1.9   

3011 Lafayette Street

  Jan-07   Silicon Valley   90,780   —     7,581   100.0   100.0   100.0   100.0   1.4      0.8      3.2      1.7   

2055 East Technology Circle

  Oct-06   Phoenix   76,350   —     7,553   100.0   100.0   100.0   1.0   1.1      0.6      3.2      1.7   

Mundells Roundabout

  Apr-07   London, England   113,464   —     7,459   100.0   100.0   0.0   0.0   1.7      1.0      3.2      1.7   

2045 & 2055 LaFayette Street

  May-04   Silicon Valley   300,000   —     6,480   100.0   100.0   100.0   100.0   4.5      2.5      2.7      1.5   

150 South First Street

  Sep-04   Silicon Valley   179,761   —     5,999   100.0   100.0   100.0   97.7   2.7      1.5      2.5      1.4   

11830 Webb Chapel Road

  Aug-04   Dallas   365,647   —     5,962   95.0   95.0   95.0   96.6   5.3      3.1      2.5      1.4   

14901 FAA Boulevard

  Jun-06   Dallas   263,700   —     4,700   100.0   100.0   100.0   100.0   3.9      2.2      2.0      1.1   

2334 Lundy Place

  Dec-02   Silicon Valley   130,752   —     4,600   100.0   100.0   100.0   100.0   1.9      1.1      2.0      1.0   

12001 North Freeway

  Apr-06   Houston   280,483   20,222   3,756   75.4   95.5   98.5   98.5   4.1      2.4      1.6      0.9   

375 Riverside Parkway

  Jun-03   Atlanta   220,016   30,175   4,409   100.0   100.0   100.0   92.9   3.3      1.9      1.9      1.0   

1525 Comstock Street

  Sep-07   Silicon Valley   21,554   20,831   4,238   98.3   0.0   0.0   0.0   0.3      0.2      1.8      1.0   

1201 Comstock Street

  Jun-08   Silicon Valley   24,000   —     4,197   100.0   100.0   0.0   0.0   0.4      0.2      1.8      1.0   

44470 Chilum Place

  Feb-07   Northern Virginia   95,440   —     4,003   100.0   100.0   100.0   100.0   1.4      0.8      1.7      0.9   

2401 Walsh Street

  Jun-05   Silicon Valley   167,932   —     3,407   100.0   100.0   100.0   100.0   2.5      1.4      1.4      0.8   

115 Second Avenue

  Oct-05   Boston   66,730   —     3,337   100.0   100.0   100.0   100.0   1.0      0.6      1.4      0.8   

8534 Concord Center Drive

  Jun-05   Denver   85,660   —     3,265   100.0   100.0   100.0   100.0   1.3      0.7      1.4      0.7   

Naritaweg 52

  Dec-07   Amsterdam,
Netherlands
  63,260   —     2,684   100.0   100.0   100.0   100.0   0.9      0.5      1.1      0.6   

21110 Ridgetop Circle

  Jan-07   Northern Virginia   135,513   —     2,660   100.0   100.0   100.0   100.0   2.0      1.1      1.1      0.6   

Cressex 1

  Dec-07   London, England   50,847   —     2,538   90.6   87.2   0.0   0.0   0.8      0.4      1.1      0.6   

1807 Michael Faraday Court

  Oct-06   Northern Virginia   19,237   —     2,322   84.1   100.0   100.0   100.0   0.3      0.2      1.0      0.5   

200 North Nash Street

  Jun-05   Los Angeles   113,606   —     2,305   100.0   100.0   100.0   100.0   1.7      1.0      1.0      0.5   

210 N Tucker Boulevard

  Aug-07   St Louis   139,588   62,000   2,279   78.4   94.1   94.1   94.1   2.1      1.2      1.0      0.5   

Paul van Vlissingenstraat 16

  Aug-05   Amsterdam,
Netherlands
  77,472   35,000   2,214   58.8   58.8   58.8   58.8   1.2      0.7      0.9      0.5   

2403 Walsh Street

  Jun-05   Silicon Valley   103,940   —     2,109   100.0   100.0   100.0   100.0   1.5      0.9      0.9      0.5   

 

Page 19


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

Occupancy Analysis

As of June 30, 2009

(Dollar amounts in thousands)

 

                      Annualized
Rent
($000)(1)
  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
    As of
06/30/09
    As of
03/31/09
    As of
12/31/08
    As of
09/30/08
    Property
Type
    Total
Portfolio
    Property
Type
    Total
Portfolio
 

8100 Boone Boulevard

  Oct-06   Northern Virginia   17,015      —       1,894   100.0   100.0   100.0   100.0   0.3      0.1      0.8      0.4   

4700 Old Ironsides Drive

  Jun-05   Silicon Valley   90,139      —       1,829   100.0   100.0   100.0   100.0   1.3      0.8      0.8      0.4   

4650 Old Ironsides Drive

  Jun-05   Silicon Valley   84,383      —       1,712   100.0   100.0   100.0   100.0   1.3      0.7      0.7      0.4   

7505 Mason King Court

  Nov-08   Northern Virginia   109,650      —       1,692   100.0   100.0   0.0   NA      1.6      0.9      0.7      0.4   

Manchester Technopark, Plot C1

  Jun-08   Manchester, England   38,016      —       1,690   100.0   100.0   100.0   100.0   0.6      0.3      0.7      0.4   

Chemin de l’Epinglier 2

  Nov-05   Geneva, Switzerland   59,190      —       1,629   100.0   100.0   100.0   100.0   0.9      0.5      0.7      0.4   

3015 Winona Avenue

  Dec-04   Los Angeles   82,911      —       1,592   100.0   100.0   100.0   100.0   1.2      0.7      0.7      0.4   

6800 Millcreek Drive

  Apr-06   Toronto, Canada   83,758      —       1,530   100.0   100.0   100.0   100.0   1.2      0.7      0.7      0.3   

3065 Gold Camp Drive

  Oct-04   Sacramento   62,957      —       1,509   100.0   100.0   100.0   100.0   0.9      0.5      0.6      0.3   

251 Exchange Place

  Nov-05   Northern Virginia   70,982      —       1,502   100.0   100.0   100.0   100.0   1.1      0.6      0.6      0.3   

Clonshaugh Industrial Estate

  Feb-06   Dublin, Ireland   20,000      —       1,474   100.0   100.0   100.0   100.0   0.3      0.2      0.6      0.3   

43831 Devon Shafron Drive

  Mar-07   Northern Virginia   117,071      —       1,439   100.0   100.0   100.0   100.0   1.7      1.0      0.6      0.3   

1125 Energy Park Drive

  Mar-05   Minneapolis/St. Paul   112,827      —       1,437   100.0   100.0   100.0   100.0   1.7      1.0      0.6      0.3   

3300 East Birch Street

  Aug-03   Los Angeles   68,807      —       1,415   100.0   100.0   100.0   100.0   1.0      0.6      0.6      0.3   

101 Aquila Way

  Apr-06   Atlanta   313,581      —       1,411   100.0   100.0   100.0   100.0   4.7      2.6      0.6      0.3   

Gyroscoopweg 2E-2F

  Jul-06   Amsterdam, Netherlands   55,585      —       1,235   100.0   100.0   100.0   100.0   0.8      0.5      0.5      0.3   

600 Winter Street

  Sep-06   Boston   30,400      —       794   100.0   100.0   100.0   100.0   0.5      0.3      0.3      0.2   

7620 Metro Center Drive

  Dec-05   Austin   45,000      —       605   100.0   100.0   100.0   100.0   0.7      0.4      0.3      0.1   

2300 NW 89th Place

  Sep-06   Miami   64,174      —       598   100.0   100.0   100.0   100.0   1.0      0.5      0.3      0.1   

1 St. Anne’s Boulevard

  Dec-07   London, England   20,219      —       272   100.0   100.0   100.0   100.0   0.3      0.2      0.1      0.1   

3 St. Anne’s Boulevard

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

7500 Metro Center Drive

  Dec-05   Austin   —        74,962     —     0.0   0.0   0.0   0.0   —        —        —        —     

365 S. Randolphville Road

  Feb-08   New York   —        264,792     —     0.0   0.0   0.0   0.0   —        —        —        —     

650 Randolph Road

  Jun-08   New York   —        127,790     —     0.0   0.0   0.0   0.0   —        —        —        —     
                                                                   
      6,721,777      833,370     236,245   95.8   96.1   95.1   95.2   100.0   56.7   100.0   53.7

Technology Manufacturing

                         

34551 Ardenwood Boulevard 1-4

  Jan-03   Silicon Valley   307,657      —       8,734   100.0   100.0   100.0   100.0   48.5   2.6   55.3   2.0

47700 Kato Road & 1055 Page Avenue

  Sep-03   Silicon Valley   183,050      —       3,794   100.0   100.0   100.0   100.0   28.8      1.5      24.0      0.9   

2010 East Centennial Circle

  May-03   Phoenix   113,405      —       2,852   100.0   100.0   100.0   100.0   17.9      1.0      18.1      0.6   

2 St. Anne’s Boulevard

  Dec-07   London, England   30,612      —       412   100.0   100.0   100.0   100.0   4.8      0.3      2.6      0.1   
                                                                   
      634,724      —       15,792   100.0   100.0   100.0   100.0   100.0   5.4   100.0   3.6

Technology Office

                         

100 & 200 Quannapowitt Parkway

  Jun-04   Boston   386,956      —       7,222   94.9   94.9   94.9   94.9   57.9   3.3   56.8   1.6

4849 Alpha Road

  Apr-04   Dallas   125,538      —       2,856   100.0   100.0   100.0   100.0   18.8      1.0      22.4      0.6   

1 Savvis Parkway

  Aug-07   St Louis   156,000      —       2,644   100.0   100.0   100.0   100.0   23.3      1.3      20.8      0.6   
                                                                   
      668,494      —       12,722   97.0   97.0   97.0   97.0   100.0   5.6   100.0   2.8
                                                                   

Portfolio Total/Weighted Average

      11,854,886 (4)    1,148,212   $ 440,797   94.8   95.1   94.9   95.2   100.0   100.0   100.0   100.0
                                                                   

 

(1) Annualized rent represents the monthly contractual rent under existing leases as of June 30, 2009 multiplied by 12.
(2) Occupancy excludes space held for redevelopment.
(3) Includes approximately 33,700 rentable square feet from a leasehold interest acquisition.
(4) Net Rentable Square Feet excludes 400,369 rentable square feet of space in a joint venture located at 2001 Sixth Avenue in Seattle, WA, which was 97.5% occupied as of June 30, 2009.

 

Page 20


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

Major Tenants

as of June 30, 2009

(Dollar amounts in thousands)

 

   

Tenant

   Number of
Locations
   Total Occupied
Square Feet(1)
   Percentage of
Net Rentable
Square Feet
    Annualized
Rent(2)
   Percentage of
Annualized

Rent
    Weighted
Average
Remaining
Lease Term
in Months
1   Savvis Communications    17    1,701,639    14.4   $ 44,124    10.0   117
2   Qwest Communications International, Inc.    15    637,712    5.4   $ 20,048    4.5   76
3   Equinix Operating Company, Inc.    4    565,297    4.8   $ 17,820    4.0   98
4   NTT Communications Company    4    295,032    2.5   $ 16,577    3.8   69
5   TelX Group, Inc.    10    101,581    0.9   $ 14,060    3.2   209
6   JPMorgan Chase & Co.    3    149,935    1.3   $ 13,914    3.2   126
7   Morgan Stanley    2    92,451    0.8   $ 13,420    3.1   55
8   AT & T    12    389,375    3.3   $ 11,844    2.7   124
9   Facebook, Inc.    2    114,168    1.0   $ 11,789    2.7   90
10   Yahoo! Inc.    2    110,847    0.9   $ 9,515    2.2   100
11   eircom Limited    1    124,500    1.0   $ 8,930    2.0   121
12   T-Systems North America, Inc.    3    82,610    0.7   $ 8,826    2.0   54
13   Microsoft Corporation    2    313,485    2.6   $ 7,983    1.8   73
14   HSBC Bank PLC    1    113,464    0.9   $ 7,459    1.7   174
15   Comverse Technology, Inc.    1    367,033    3.1   $ 7,222    1.6   19
16   Amazon    4    274,348    2.3   $ 7,094    1.6   144
17   Horizon Data Center Solutions    2    52,077    0.4   $ 6,810    1.5   90
18   Level 3 Communications, LLC(3)(4)    17    261,100    2.2   $ 6,358    1.4   64
19   Amgen, Inc.    1    131,386    1.1   $ 5,946    1.4   71
20   AboveNet, Inc.    14    135,147    1.1   $ 5,872    1.3   120
                                 
  Total/Weighted Average       6,013,187    50.7   $ 245,611    55.7   99
                                 

 

(1) Occupied square footage is defined as leases that commenced on or before June 30, 2009.
(2) Annualized rent represents the monthly contractual rent under existing leases as of June 30, 2009 multiplied by 12.
(3) Level 3 Communications includes Wiltel Communications & Broadwing Communications.
(4) Excludes 63,233 square feet of net rentable space in 6 Braham Street. This property is subleased by Level 3 Communications from Leslie & Godwin, a United Kingdom subsidiary of AON Corporation, through December 2009. Level 3 Communications has executed a lease that will commence upon expiration of the Leslie & Godwin lease and continue through December 2015. Leslie & Godwin remains liable to us for rents under its lease. Including the lease at 6 Braham Street, total occupied square feet and annualized rent would be 353,021 and $9,505, respectively.

 

Page 21


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

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   365 South Randolphville Road    New York    26
11   14901 FAA Boulevard    Dallas    25
12   2401 Walsh Street    Silicon Valley    25
13   2403 Walsh Street    Silicon Valley    25
14   4700 Old Ironsides Drive    Silicon Valley    25
15   St. Anne’s Boulevard (3 Buildings)    London    25
         
  Total Potential Power Capacity - Top 15 Properties    761

 

(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 22


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

Lease Expirations and Lease Distribution

Lease Expirations

As of June 30, 2009

(Dollar amounts in thousands)

 

Year

   Number of
Leases Expiring

(1)
   Square
Footage of
Expiring
Leases
   Percentage of
Net Rentable
Square Feet
    Annualized
Rent (2)
   Percentage of
Annualized Rent
    Annualized Rent
Per Occupied
Square Foot
   Annualized Rent
Per Occupied
Square Foot at
Expiration
   Annualized
Rent at
Expiration
($000)

Available

      621,073    5.2     —      0.0        

2009(3)

   148    289,279    2.4     14,564    3.3   $ 50.35      47.26      13,671

2010

   96    682,828    5.8     24,342    5.5   $ 35.65      36.43      24,875

2011

   104    1,327,491    11.2     33,142    7.5   $ 24.97      25.69      34,109

2012

   89    150,744    1.3     14,843    3.4   $ 98.46      105.68      15,931

2013

   76    958,996    8.1     49,349    11.2   $ 51.46      57.80      55,434

2014

   63    809,895    6.8     39,517    9.0   $ 48.79      57.15      46,283

2015

   76    1,799,730    15.2     61,873    14.0   $ 34.38      38.60      69,470

2016

   51    811,531    6.8     27,469    6.2   $ 33.85      39.30      31,889

2017

   34    550,868    4.7     16,976    3.9   $ 30.82      36.99      20,377

2018

   47    579,575    4.9     26,050    5.9   $ 44.95      61.90      35,873

Thereafter

   129    3,272,876    27.6     132,672    30.1   $ 40.54      54.62      178,768
                                                 

Portfolio Total / Weighted Average

   913    11,854,886    100.0   $ 440,797    100.0   $ 39.24    $ 46.88    $ 526,680
                                                 

Lease Distribution

As of June 30, 2009

(Dollar amounts in thousands)

 

Square Feet Under Lease

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

Available

        621,073    5.2     —      —     

2,500 or less

   536    58.7   290,559    2.4     40,380    9.2

2,501 - 10,000

   177    19.4   987,824    8.3     61,938    14.0

10,001 - 20,000

   68    7.4   1,252,037    10.6     52,272    11.9

20,001 - 40,000

   59    6.5   1,773,900    15.0     88,646    20.1

40,001 - 100,000

   45    4.9   2,867,712    24.2     100,806    22.9

Greater than 100,000

   28    3.1   4,061,781    34.3     96,755    21.9
                                   

Portfolio Total

   913    100.0   11,854,886    100.0   $ 440,797    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 June 30, 2009 multiplied by 12.
(3) Includes 63,233 square feet of net rentable space in 6 Braham Street. This property is subleased by Level 3 Communications from Leslie & Godwin, a United Kingdom subsidiary of AON Corporation, through December 2009. Level 3 Communications has executed a lease that will commence upon expiration of the Leslie & Godwin lease and continue through December 2015. Leslie & Godwin remains liable to us for rents under its lease.

 

Page 23


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

Leasing Activity

As of June 30, 2009

 

     For the Three Months
Ended June 30, 2009
    % Leased  

Occupied Square Feet as of March 31, 2009(1)

   11,202,601        95.1
        

2Q 2009 Acquisitions:

    

Loudoun Exchange II (3 Land Parcels)

   —          —     
              

Occupied Square Feet including 2Q 2009 Acquisitions(1)

   11,202,601        94.5

Expirations, Terminations and Reductions

   (101,125     (0.9 )% 

New Leases and Expansions

   115,130        1.0

Remeasurements(2)

   17,207        0.2
              

Occupied Square Feet as of June 30, 2009(1)

   11,233,813        94.8
              

GAAP Rent Growth(3)

    

Expiring Rent per Square Foot

     $ 18.52   

New Rent per Square Foot

     $ 138.63   

Weighted Average Lease Term - New (in months)

       90   

 

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

 

Page 24


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

Tenant Improvements and Leasing Commissions

 

     Three Months Ended    Full Year
2008
     6/30/2009    3/31/2009    12/31/2008    9/30/2008   

Renewals(1)

              

Number of renewals

     19      13      10      6      29

Square Feet

     308,205      163,216      25,866      72,520      151,114

Tenant improvement costs per square foot(2)

   $ 0.17    $ 0.14    $ 3.08    $ 2.70    $ 2.17

Leasing commission costs per square foot(2)

   $ 10.26    $ 6.04    $ 5.38    $ 7.31    $ 6.72
                                  

Total renewal lease costs per square foot

   $ 10.43    $ 6.18    $ 8.46    $ 10.01    $ 8.89

New Leases(3)

              

Number of non-redevelopment leases

     17      12      12      21      64

Non-Redevelopment square feet

     35,875      121,926      135,884      48,834      257,354

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

   $ 12.97    $ 0.57    $ —      $ 15.84    $ 12.87

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

   $ 12.42    $ 2.79    $ 9.85    $ 5.59    $ 10.97

Number of redevelopment leases

     10      16      13      19      78

Redevelopment square feet

     79,255      328,538      184,092      302,320      912,942

Redevelopment tenant improvement costs per square
foot
(2)(4)

   $ 14.89    $ 1.35    $ 3.11    $ 4.96    $ 2.97

Redevelopment leasing commission costs per square
foot
(2)

   $ 20.67    $ 12.39    $ 17.62    $ 9.69    $ 11.79
                                  

Total Number of Leases

     27      28      25      40      142

Total Square Feet

     115,130      450,464      319,976      351,154      1,170,296

Total new lease costs per square foot

   $ 32.39    $ 10.93    $ 16.11    $ 15.60    $ 16.76

Total(5)

              

Number of leases

     46      41      35      46      171

Square Feet

     423,335      613,680      345,842      423,674      1,321,410

Tenant improvement costs per square foot(2)

   $ 4.01    $ 0.87    $ 1.89    $ 5.83    $ 4.81

Leasing commission costs per square foot(2)

   $ 12.39    $ 8.79    $ 13.65    $ 8.81    $ 11.05
                                  

Total costs per square foot

   $ 16.40    $ 9.66    $ 15.54    $ 14.64    $ 15.86

 

(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) Redevelopment Tenant Improvement costs include tenant-specific building improvements for square footage designated as space held for redevelopment; however, it does not include redevelopment costs.
(5) Recent property acquisitions may make a period over period comparison difficult. For a list of the acquisition dates of our properties see page 18.

 

Page 25


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

Historical Capital Expenditures

 

     Three Months Ended
     6/30/2009    3/31/2009    12/31/2008    9/30/2008    6/30/2008    3/31/2008

Recurring capital expenditures(1)(2)

   $ 9,628,000    $ 4,779,000    $ 7,380,000    $ 5,489,000    $ 5,272,000    $ 7,349,000

Non-recurring capital expenditures(2)

   $ 88,605,000    $ 125,530,000    $ 135,646,000    $ 128,204,000    $ 138,379,000    $ 86,040,000

Total net rentable square feet at period end excluding redevelopment space

     11,854,886      11,784,573      11,387,102      11,244,657      10,977,945      10,795,795

 

(1) Recurring capital expenditures represents non-incremental building improvements required to maintain current revenues along with leasing commissions. Recurring capital expenditures do not include acquisition capital that was taken into consideration when underwriting the purchase of a building or expenditures 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 18.

 

Page 26


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

Redevelopment Activity

For the quarter ended June 30, 2009

(Square feet)

 

Activity for the quarter ended June 30, 2009

   US     Europe    Total     % Leased(1)  

Redevelopment Space as of March 31, 2009

   996,312      222,213    1,218,525     

Acquired Redevelopment Space and New Construction Space

   22,409      —      22,409     

Converted Redevelopment Space:

         

Turn-Key DatacenterSM

   (80,846   —      (80,846   75.5

Powered Base BuildingSM

   (11,876   —      (11,876   97.0

Remeasurement Adjustments

   —        —      —       
                   

Redevelopment Space as of June 30, 2009

   925,999      222,213    1,148,212     
                   

Redevelopment Space Under Construction at Quarter End

   US     Europe    Total     % Leased(2)  

Turn-Key DatacenterSM

   110,012      76,000    186,012      32.0

Build-to-Suit

   —        —      —       

New Powered Base BuildingSM Shell

   —        —      —       
                   

Redevelopment Space Under Construction as of June 30, 2009

   110,012      76,000    186,012     
                   

New Development Under Construction at Quarter End(3)

   US     Europe    Total        

New Powered Base BuildingSM Shell

   135,000      —      135,000     

 

(1) Defined as leases that have commenced on or before June 30, 2009.
(2) Defined as leases that were signed on or before June 30, 2009.
(3) Not included as part of our redevelopment space inventory as of June 30, 2009.

 

Page 27


DIGITAL REALTY TRUST, INC.

Second Quarter 2009

 

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 capitalized leasing commissions necessary to maintain the operating performance of our properties, all of which have real economic effect and could materially impact our financial condition and 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.

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, including on a per share and unit basis. 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) straight line rents (v) fair value of lease revenue amortization (vi) capitalized leasing payroll (vii) recurring tenant improvements and (viii) 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.

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, exclude capitalized costs, such as leasing commissions, 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.

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 capitalized 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.

 

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