EX-99.2 3 dex992.htm SUPPLEMENTAL OPERATING AND FINANCIAL DATA POSTED OCTOBER 29, 2009 Supplemental Operating and Financial Data posted October 29, 2009

Exhibit 99.2

LOGO


DIGITAL REALTY TRUST, INC.

Third 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 September 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.

Third 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.

Third Quarter 2009

 

Corporate Information

Corporate Profile

Digital Realty Trust, Inc. owns, acquires, repositions and manages technology-related real estate. The Company’s 78 properties, excluding one property held as an investment in an unconsolidated joint venture contain applications and operations critical to the day-to-day operations of technology industry tenants and corporate enterprise data center tenants. Comprising approximately 13.8 million net rentable square feet, including approximately 1.9 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, Corporate Development

David J. Caron: Senior Vice President, Portfolio Management

Michael Manos: Senior Vice President, Technical Services

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    Bank of America
Michael Knott    Srinivas Anantha    Michael Bilerman      David Aubuchon    Jamie Feldman
(949) 640-8780    (617) 428-5960    (212) 816-1685      (314) 863-4235    (646) 855-5808
Matthew Wokasch    Peter Armstrong    Mark Montandon      Justin Pelham-Webb    Jana Galan
(949) 640-8780    (212) 667-5808    (212) 816-1685      (314) 863-6413    (646) 855-9081
RBC Capital Markets    Raymond James    KeyBanc Capital Markets      ISI    Stifel Nicolaus
Dave Rodgers    Paul D. Puryear    Jordan Sadler      Steve Sakwa    Todd Weller
(440) 715-2647    (727) 567-2253    (917) 368-2280      (212) 446-9462    (443) 224-1305
Mike Carroll    William A. Crowe    Craig Mailman      Ian Weismann    Ben Lowe
(440) 715-2649    (727) 567-2594    (917) 368-2316      (212) 446-9461    (443) 224-1264

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):

 

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

High Price *

   $ 48.21      $ 39.84      $ 35.70      $ 47.62      $ 51.28      $ 43.45      $ 39.20   

Low Price *

   $ 34.27      $ 32.14      $ 24.96      $ 18.04      $ 36.96      $ 35.43      $ 31.28   

Closing Price, end of quarter *

   $ 45.71      $ 35.85      $ 33.18      $ 32.85      $ 47.25      $ 40.91      $ 35.50   

Average daily trading volume *

     1,362,583        2,258,424        2,074,752        1,876,211        1,139,423        904,670        1,224,336   

Indicated dividend per common share **

   $ 1.440      $ 1.320      $ 1.320      $ 1.320      $ 1.240      $ 1.240      $ 1.240   

Closing annual dividend yield, end of quarter

     3.2     3.7     4.0     4.0     2.6     3.0     3.5

Closing shares and units outstanding end of quarter ***

     82,173,996        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

   $ 3,756,173      $ 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 September 30, 2009, the total number of shares and units includes 76,519,219 shares of common stock, 4,360,549 common units held by third parties and 1,294,228 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.

Third Quarter 2009

 

Ownership Structure

As of September 30, 2009

LOGO

 

Partner

   # of Units (2)    % Ownership  

Digital Realty Trust, Inc.

   76,519,219    93.1

Cambay Tele.com, LLC (3)

   4,327,827    5.3

Wave Exchange, LLC (3)

   32,722    0.0

Directors, Executive Officers and Others

   1,294,228    1.6
           

Total

   82,173,996    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 76,519,219 shares of common stock, 4,360,549 common units held by third parties and 1,294,228 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 assumed 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 564,913 common units held by the members of Cambay Tele.com, LLC.

 

Page 5


DIGITAL REALTY TRUST, INC.

Third 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-Sep-09     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

    76,519,219        76,140,807        76,042,511        73,306,703        72,556,699        66,174,618        65,481,470   

Common units outstanding

    5,654,777        5,872,570        5,938,205        5,819,130        5,702,922        6,231,221        6,847,966   
                                                       

Total shares and Operating Partnership units

    82,173,996        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)

  $ 3,756,173      $ 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        686,637        686,750        686,750        686,750        686,750   

Total debt at balance sheet carrying value

    1,599,270        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

  $ 6,042,080      $ 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

    26.5     29.5     29.7     29.7     22.6     27.2     26.8

Selected Balance Sheet Data

             

Investments in real estate (before depreciation)

  $ 3,416,083      $ 3,283,874      $ 3,155,062      $ 3,051,180      $ 2,905,275      $ 2,816,258      $ 2,602,166   

Total assets

    3,532,418        3,444,708        3,351,613        3,281,045        3,158,885        3,070,850        2,895,036   

Total liabilities

    1,878,259        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

  $ 163,227      $ 155,007      $ 149,134      $ 147,106      $ 142,016      $ 123,776      $ 114,547   

Total operating expenses from continuing operations

    117,571        112,161        109,931        106,537        108,358        94,942        89,253   

Interest expense from continuing operations

    22,559        22,495        18,937        17,747        15,716        14,956        15,202   

Net income

    23,945        21,203        21,189        25,133        18,419        13,550        10,816   

Net income (loss) available to common stockholders

    12,406        10,271        10,295        13,793        7,484        3,094        2,319   

Financial Ratios

             

EBITDA (3)

  $ 85,737      $ 82,241      $ 75,972      $ 78,766      $ 69,902      $ 58,367      $ 56,763   

Adjusted EBITDA (4)

  $ 97,276      $ 93,173      $ 86,866      $ 90,106      $ 80,837      $ 68,823      $ 65,260   

Cash interest expense (5)

  $ 19,812      $ 16,695      $ 21,398      $ 17,439      $ 20,116      $ 14,691      $ 20,093   

Fixed charges (6)

  $ 32,981      $ 29,721      $ 34,505      $ 30,323      $ 32,619      $ 27,163      $ 30,737   

Debt service coverage ratio (7)

    4.9     5.6     4.1     5.2     4.0     4.7     3.2

Fixed charge coverage ratio (8)

    2.9     3.1     2.5     3.0     2.5     2.5     2.1

Profitability measures

             

Net income (loss) per common share - basic

  $ 0.16      $ 0.13      $ 0.14      $ 0.19      $ 0.11      $ 0.05      $ 0.04   

Net income (loss) per common share - diluted

  $ 0.16      $ 0.13      $ 0.14      $ 0.19      $ 0.10      $ 0.05      $ 0.03   

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

  $ 0.74      $ 0.71      $ 0.70      $ 0.75      $ 0.68      $ 0.58      $ 0.57   

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

  $ 0.59      $ 0.51      $ 0.53      $ 0.56      $ 0.56      $ 0.41      $ 0.38   

Dividends per share and common unit

  $ 0.36      $ 0.33      $ 0.33      $ 0.33      $ 0.31      $ 0.31      $ 0.31   

Diluted FFO payout ratio (11)

    48.9     46.5     47.4     44.1     45.6     53.2     54.4

Diluted AFFO payout ratio (12)

    61.0     64.7     62.3     58.9     55.4     75.6     81.6

Portfolio Statistics

             

Buildings

    108        99        99        98        96        96        93   

Properties

    78        75        75        75        74        74        71   

Net rentable square feet, excluding redevelopment space

    11,964,522        11,854,886        11,784,573        11,387,102        11,244,657        10,977,945        10,795,795   

Square feet held for redevelopment (13)

    1,876,885        1,148,212        1,218,525        1,573,612        1,606,407        1,873,119        1,863,700   

Occupancy at end of quarter (14)

    95.2     94.8     95.1     94.9     95.2     95.2     94.7

Weighted average remaining lease term (years) (15)

    7.6        7.5        7.6        7.3        7.3        7.4        7.7   

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

    95.1     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 ASC 470-20, formerly FASB APB 14-1 “Accounting for Convertible Debt Instruments That May be Settled Upon Conversion (Including Partial Cash Settlement)” and FASB ASC
810-10, formerly 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.

Third Quarter 2009

 

Consolidated Balance Sheets (1)

(Dollars in thousands, except share data)

 

     September 30, 2009     December 31, 2008  
     (unaudited)        
ASSETS     

Investments in real estate

    

Land

   $ 364,010      $ 316,318   

Acquired ground leases

     2,795        2,733   

Buildings and improvements

     2,770,434        2,467,830   

Tenant improvements

     270,490        255,818   
                

Investments in real estate

     3,407,729        3,042,699   

Accumulated depreciation and amortization

     (418,794     (302,960
                

Net investments in properties

     2,988,935        2,739,739   

Investment in unconsolidated joint venture

     8,354        8,481   
                

Net investments in real estate

     2,997,289        2,748,220   

Cash and cash equivalents

     41,152        73,334   

Accounts and other receivables, net

     45,404        39,108   

Deferred rent

     134,458        99,957   

Acquired above market leases, net

     27,255        31,352   

Acquired in place lease value and deferred leasing costs, net

     213,239        222,389   

Deferred financing costs, net

     21,357        16,275   

Restricted cash

     36,813        45,470   

Other assets

     15,451        4,940   
                

Total Assets

   $ 3,532,418      $ 3,281,045   
                

LIABILITIES AND EQUITY

    

Revolving credit facility

   $ 149,838      $ 138,579   

Unsecured senior notes

     83,000        58,000   

Mortgage loans

     935,206        1,026,594   

4.125 % exchangeable senior debentures due 2026, net of discount

     164,826        161,901   

5.50% exchangeable senior debentures due 2029

     266,400        —     

Accounts payable and other accrued liabilities

     153,072        171,176   

Accrued dividends and distributions

     —          26,092   

Acquired below market leases, net

     67,099        76,660   

Security deposits and prepaid rents

     58,818        46,967   
                

Total Liabilities

     1,878,259        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), 6,999,955 and 7,000,000 issued and outstanding as of September 30, 2009 and December 31, 2008, respectively

     169,067        169,068   

Series D Cumulative Convertible Preferred Stock, 5.500%, $345,000,000 liquidation preference ($25.00 per share), 13,795,500 and 13,800,000 issued and outstanding as of September 30, 2009 and December 31, 2008, respectively

     333,472        333,581   

Common Stock; $0.01 par value: 125,000,000 authorized, 76,519,219 and 73,306,703 shares issued and outstanding as of September 30, 2009 and December 31, 2008, respectively

     763        732   

Additional paid-in capital

     1,148,825        1,057,107   

Dividends in excess of earnings

     (211,596     (166,863

Accumulated other comprehensive income, net

     (26,471     (49,503
                

Total stockholders’ equity

     1,573,859        1,503,921   
                
Noncontrolling interests:     

Noncontrolling interest in operating partnership

     62,212        66,797   

Noncontrolling interest in consolidated joint venture

     18,088        4,358   
                

Total noncontrolling interests

     80,300        71,155   
                

Total Equity

     1,654,159        1,575,076   
                

Total Liabilities and Equity

   $ 3,532,418      $ 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.

Third Quarter 2009

 

Consolidated Quarterly Statements of Operations (1)

(unaudited and in thousands, except share data)

 

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

Rental

  $ 130,878      $ 125,380      $ 118,089      $ 111,398      $ 102,449      $ 97,966      $ 92,746   

Tenant reimbursements

    32,236        29,544        31,027        30,136        29,882        25,698        21,787   

Other

    113        83        18        5,572        9,685        112        14   
                                                       

Total operating revenues

    163,227        155,007        149,134        147,106        142,016        123,776        114,547   
                                                       

Rental property operating and maintenance

    45,278        42,301        42,573        43,664        39,859        35,943        31,681   

Property taxes

    9,295        9,149        9,211        5,767        8,689        8,522        8,124   

Insurance

    1,495        1,488        1,456        1,333        1,252        1,198        1,205   

Depreciation and amortization

    50,439        49,183        46,304        47,086        46,548        39,591        39,153   

General and administrative

    10,660        10,040        10,102        8,661        11,261        9,686        8,783   

Other

    404        —          285        26        749        2        307   
                                                       

Total operating expenses

    117,571        112,161        109,931        106,537        108,358        94,942        89,253   
                                                       

Operating income

    45,656        42,846        39,203        40,569        33,658        28,834        25,294   

Equity in earnings of unconsolidated joint venture

    1,091        741        1,116        1,860        178        173        158   

Interest and other income

    90        403        243        591        453        407        655   

Interest expense

    (22,559     (22,495     (18,937     (17,747     (15,716     (14,956     (15,202

Tax expense

    (333     (292     (436     (140     (154     (726     (89

Loss from early extinguishment of debt

      —          —          —          —          (182     —     
                                                       

Net Income

    23,945        21,203        21,189        25,133        18,419        13,550        10,816   

Net Income attributable to noncontrolling interest

    (1,438     (831     (793     (1,238     (833     (354     (239
                                                       

Net Income Attributable to Digital Realty Trust, Inc.

    22,507        20,372        20,396        23,895        17,586        13,196        10,577   

Preferred stock dividends

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

Net income available to common stockholders

  $ 12,406      $ 10,271      $ 10,295      $ 13,793      $ 7,484      $ 3,094      $ 2,319   
                                                       

Net income per share available to common stockholders - basic

  $ 0.16      $ 0.13      $ 0.14      $ 0.19      $ 0.11      $ 0.05      $ 0.04   

Net income per share available to common stockholders - diluted

  $ 0.16      $ 0.13      $ 0.14      $ 0.19      $ 0.10      $ 0.05      $ 0.03   

Weighted-average shares outstanding - basic

    76,301,577        76,121,380        74,703,755        73,011,453        70,916,019        65,889,122        65,431,586   

Weighted-average shares outstanding - diluted

    77,674,137        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

    83,466,346        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.

Third Quarter 2009

 

Funds From Operations (FFO) (1)

(unaudited and in thousands except per share data)

 

    Three Months Ended  
    30-Sep-09     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

  $ 12,406      $ 10,271      $ 10,295      $ 13,793      $ 7,484      $ 3,094      $ 2,319   

Adjustments:

             

Noncontrolling interests in operating partership

    898        757        793        1,149        637        304        239   

Real estate related depreciation and amortization (2)

    50,163        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

    543        858        646        (286     859        872        894   
                                                       

FFO available to common stockholders and unitholders

  $ 64,010      $ 60,786      $ 57,821      $ 61,546      $ 55,339      $ 43,684      $ 42,446   
                                                       

FFO per share and unit:

             

Basic

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

Diluted (3)

  $ 0.74      $ 0.71      $ 0.70      $ 0.75      $ 0.68      $ 0.58      $ 0.57   
                                                       

Weighted-average shares and units outstanding - basic

    82,094        81,999        80,550        79,096        76,953        72,354        72,175   

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

    101,492        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

  $ 50,439      $ 49,183      $ 46,304      $ 47,086      $ 46,548      $ 39,591      $ 39,153   

Non-real estate depreciation

    (276     (283     (217     (196     (189     (177     (159
                                                       
  $ 50,163      $ 48,900      $ 46,087      $ 46,890      $ 46,359      $ 39,414      $ 38,994   
                                                       

 

(3)     At September 30, 2009, we had 7,000 series C convertible preferred shares and 13,796 series D convertible preferred shares outstanding that were convertible into 3,615 common shares and 8,215 common shares, respectively. In addition, we had a balance of $266,400 of 5.50% exchangeable senior debentures that were exchangeable for 6,195 and 3,722 common shares on a weighted average basis for the three and nine months ended September 30, 2009, respectively. 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

  $ 64,010      $ 60,786      $ 57,821      $ 61,546      $ 55,339      $ 43,684      $ 42,446   

Add: Series C convertible preferred dividends

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

Add: Series D convertible preferred dividends

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

Add: 5.50% exchangeable senior debentures interest expense

    4,050        3,148        —          —          —          —          —     
                                                       

FFO available to common stockholders and unitholders — diluted

  $ 74,716      $ 70,590      $ 64,477      $ 68,204      $ 61,997      $ 50,342      $ 47,259   
                                                       

Weighted average common stock and units outstanding

    82,094        81,999        80,550        79,096        76,953        72,354        72,175   

Add: Effect of dilutive securities (excl. series C & D convert. preferred stock & 5.5% debentures)

    1,373        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        3,615   

Add: Effect of dilutive series D convertible preferred stock

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

Add: Effect of dilutive 5.50% exchangeable senior debentures

    6,195        4,902        —          —          —          —          —     
                                                       

Weighted average common stock and units outstanding — diluted

    101,492        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-Sep-09     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)

  $ 64,010      $ 60,786      $ 57,821      $ 61,546      $ 55,339      $ 43,684      $ 42,446   

Adjustments:

             

Non-real estate depreciation

    276        283        217        196        189        177        159   

Amortization of deferred financing costs

    2,114        1,896        1,662        1,599        1,524        1,411        1,398   

Amortization of debt discount

    992        974        959        943        927        911        896   

Non-cash compensation

    2,185        2,130        1,520        1,663        3,174        1,582        1,220   

Loss from early extinguishment of debt

    —          —          —          —          —          182        —     

Straight line rents

    (11,669     (11,089     (11,308     (11,036     (8,301     (8,899     (7,771

Above and below market rent amortization

    (1,953     (2,118     (2,139     (1,971     (2,081     (2,525     (2,685

Capitalized leasing compensation

    (1,917     (1,414     (1,271     (1,008     (1,009     (974     (1,045

Recurring capital expenditures and tenant improvements

    (2,980     (7,161     (496     (3,031     (1,730     (3,699     (2,868

Capitalized leasing commissions

    (1,823     (2,467     (4,283     (4,349     (3,759     (1,259     (3,936
                                                       

AFFO available to common stockholders and unitholders

  $ 49,235      $ 41,820      $ 42,682      $ 44,552      $ 44,273      $ 30,591      $ 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.

Third Quarter 2009

 

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

(unaudited and in thousands)

 

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

Net income available to common stockholders

  $ 12,406      $ 10,271      $ 10,295      $ 13,793      $ 7,484      $ 3,094      $ 2,319   

Interest

    22,559        22,495        18,937        17,747        15,716        14,956        15,202   

Taxes

    333        292        436        140        154        726        89   

Depreciation and amortization

    50,439        49,183        46,304        47,086        46,548        39,591        39,153   
                                                       

EBITDA

    85,737        82,241        75,972        78,766        69,902        58,367        56,763   

Noncontrolling interest

    1,438        831        793        1,238        833        354        239   

Preferred stock dividends

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

Adjusted EBITDA

  $ 97,276      $ 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-Sep-09     30-Jun-09     31-Mar-09     31-Dec-08     30-Sep-08     30-Jun-08     31-Mar-08  

Total GAAP interest expense

    22,559        22,495        18,937        17,747        15,716        14,956        15,202   

Capitalized interest

    2,027        2,147        3,072        4,305        4,630        4,708        4,708   

Change in accrued interest and other noncash amounts

    (4,774     (7,947     (611     (4,613     (230     (4,973     183   
                                                       

Cash interest expense (a)

    19,812        16,695        21,398        17,439        20,116        14,691        20,093   

Scheduled debt principal payments and preferred dividends

    13,169        13,026        13,107        12,884        12,503        12,472        10,644   
                                                       

Total fixed charges (b)

    32,981        29,721        34,505        30,323        32,619        27,163        30,737   
                                                       

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

    4.3     4.1     4.6     5.1     5.1     4.6     4.3

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

    4.9     5.6     4.1     5.2     4.0     4.7     3.2

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

    2.7     2.6     2.7     2.9     2.9     2.5     2.5

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

    2.9     3.1     2.5     3.0     2.5     2.5     2.1

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

    26.5     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)

    37.8     42.9     43.9     44.4     34.8     40.9     42.2

Pretax income to interest expense (g)

    2.1     1.9     2.1     2.4     2.2     1.9     1.7

Net Debt to Adjusted EBITDA (h)

    4.0     3.9     3.9     3.6     3.8     4.9     4.4

 

(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 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.

Third Quarter 2009

 

Net Operating Income (NOI) and Run-rate NOI

For the three months ended September 30, 2009

(unaudited and in thousands)

 

Rental revenues

   $ 130,878   

Tenant reimbursements

     32,236   

Rental property operating and maintenance

     (45,278

Property taxes

     (9,295

Insurance

     (1,495
        

NOI

   $ 107,046   

Actual results of properties acquired during the quarter:

  

Rental revenues

     (30

Tenant reimbursements

     —     

Rental property operating and maintenance

     8   

Property taxes

     —     

Insurance

     —     

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

  

Rental revenues

     500   

Tenant reimbursements

     —     

Rental property operating and maintenance

     —     

Property taxes

     —     

Insurance

     —     
        

Run-rate NOI

   $ 107,524   
        

Reconciliation of net income available to common stockholders to NOI

  

Net income available to common stockholders

   $ 12,406   

Other revenues

     (113

Interest expense

     22,559   

Depreciation and amortization

     50,439   

General and administrative expenses

     10,660   

Tax expense

     333   

Other expenses

     404   

Equity in earnings of unconsolidated joint venture

     (1,091

Interest and other income

     (90

Net Income attributable to noncontrolling interest

     1,438   

Preferred stock dividends

     10,101   
        

NOI

   $ 107,046   
        

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

 

Page 11


DIGITAL REALTY TRUST, INC.

Third Quarter 2009

 

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

(unaudited and in thousands)

 

     Three Months Ended  

Same store (2)

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

Operating Revenues:

              

Rental

   $ 127,854      $ 122,415      $ 115,993      $ 110,692      $ 101,575      $ 97,892      $ 92,746   

Tenant reimbursements

     31,038        28,444        29,919        28,507        29,878        25,698        21,787   

Other

     113        83        18        5,572        9,685        112        14   
                                                        

Total operating revenues

     159,005        150,942        145,930        144,771        141,138        123,702        114,547   
                                                        

Operating Expenses:

              

Rental property operating and maintenance

     43,259        40,435        41,094        41,764        39,802        35,931        31,624   

Property taxes

     9,027        8,986        9,107        5,723        8,650        8,521        8,124   

Insurance

     1,455        1,463        1,439        1,325        1,246        1,198        1,205   

Depreciation and amortization

     49,319        48,092        45,460        46,794        46,255        39,591        39,153   

General and administrative (3)

     10,660        10,040        10,102        8,661        11,261        9,686        8,783   

Other

     404        —          285        26        749        2        307   
                                                        

Total operating expenses

     114,124        109,016        107,487        104,293        107,963        94,929        89,196   

Operating income

     44,881        41,926        38,443        40,478        33,175        28,773        25,351   

Other Income (Expenses):

              

Equity in earnings of unconsolidated joint venture

     1,091        741        1,116        1,860        178        173        158   

Interest and other income

     91        402        242        589        452        405        655   

Interest expense (4)

     (22,301     (22,459     (18,937     (17,747     (15,716     (14,954     (15,202

Tax expense

     (332     (314     (434     (140     (154     (726     (89

Loss from early extinguishment of debt

     —          —          —          —          —          (182     —     
                                                        

Net Income

   $ 23,430      $ 20,296      $ 20,430      $ 25,040      $ 17,935      $ 13,489      $ 10,873   

New properties (2)

              

Operating Revenues:

              

Rental

   $ 3,024      $ 2,965      $ 2,096      $ 706      $ 874      $ 74      $ —     

Tenant reimbursements

     1,198        1,100        1,108        1,629        4        —          —     

Other

     —          —          —          —          —          —          —     
                                                        

Total operating revenues

     4,222        4,065        3,204        2,335        878        74        —     
                                                        

Operating Expenses:

              

Rental property operating and maintenance

     2,019        1,866        1,479        1,900        57        12        57   

Property taxes

     268        163        104        44        39        1        —     

Insurance

     40        25        17        8        6        —          —     

Depreciation and amortization

     1,120        1,091        844        292        293        —          —     

General and administrative (3)

     —          —          —          —          —          —          —     

Other

     —          —          —          —          —          —          —     
                                                        

Total operating expenses

     3,447        3,145        2,444        2,244        395        13        57   
                                                        

Operating income

     775        920        760        91        483        61        (57

Other Income (Expenses):

              

Equity in earnings of unconsolidated joint venture

     —          —          —          —          —          —          —     

Interest and other income

     (1     1        1        2        1        2        —     

Interest expense (4)

     (258     (36     —          —          —          (2     —     

Income tax expense

     (1     22        (2     —          —          —          —     

Loss from early extinguishment of debt

     —          —          —          —          —          —          —     
                                                        

Net Income

   $ 515      $ 907      $ 759      $ 93      $ 484      $ 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.

Third Quarter 2009

 

Same Store Operating Trend Summary (1)

(unaudited and in thousands, except share data)

 

     Three Months Ended  

Same store (2) 

   30-Sep-09     30-Jun-09     Percentage
Change
    30-Sep-08     Percentage
Change
 

Rental (3)

   $ 127,854      $ 122,415      4.4   $ 101,575      25.9

Tenant reimbursements

     31,038        28,444      9.1     29,878      3.9
                                    
     158,892        150,859      5.3     131,453      20.9

Rental property operating and maintenance

     43,259        40,435      7.0     39,802      8.7

Property taxes

     9,027        8,986      0.5     8,650      4.4

Insurance

     1,455        1,463      (0.5 )%      1,246      16.8
                                    
     53,741        50,884      5.6     49,698      8.1
                                    

Net Operating Income (4)

   $ 105,151      $ 99,975      5.2   $ 81,755      28.6
                                    

Same store occupancy at end of quarter

     95.1     94.7       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 $11,102, $10,479 and $8,086, respectively, and non-cash adjustments related to FAS 141 were $1,926, $2,092 and $2,050, respectively.
(4) For a definition and discussion of Net Operating Income, see page 28.

 

Page 13


DIGITAL REALTY TRUST, INC.

Third Quarter 2009

 

Consolidated Debt Analysis

(unaudited, in thousands)

 

     Maturity Date     Principal Balance as of
September 30, 2009
    % of Debt     Interest Rate as of
September 30, 2009
    Interest Rate as of
September 30, 2009
including swaps
 

Unhedged Floating Rate Debt

          

Revolving credit facility

   August 31, 2012 (1)      149,838      9.4   1.37   —     
                    
     $ 149,838      9.4    

Fixed Rate Mortgage Debt and Hedged Floating Rate Debt

          

Secured Term Debt

   November 11, 2014        144,698      9.0   5.65   —     

3 Corporate Place

   August 1, 2013 (1)      80,000      5.0   6.72   —     

200 Paul Avenue 1-4

   October 8, 2015        78,198      4.9   5.74   —     

2045 & 2055 LaFayette Street

   February 6, 2017        67,475      4.2   5.93   —     

Mundells Roundabout

   November 30, 2013        68,443      4.3   1.70   4.18

600 West Seventh Street

   March 15, 2016        55,854      3.5   5.80   —     

34551 Ardenwood Boulevard 1-4

   November 11, 2016        55,000      3.4   5.95   —     

1100 Space Park Drive

   December 11, 2016        55,000      3.4   5.89   —     

150 South First Street

   February 6, 2017        52,907      3.3   6.30   —     

114 Rue Ambroise Croizat

   January 18, 2012        46,218      2.9   2.10   5.13

1500 Space Park Drive

   October 5, 2013        42,352      2.6   6.15   —     

2334 Lundy Place

   November 11, 2016        40,000      2.5   5.96   —     

Unit 9, Blanchardstown Corporate Park

   January 18, 2012        39,737      2.5   2.10   5.35

6 Braham Street

   April 10, 2011        20,776      1.3   1.44   5.84

1201 Comstock Street

   June 24, 2013 (1)      17,920      1.1   3.75   —     

Datacenter Park — Dallas

   September 15, 2012  (1)      17,000      1.1   5.00   —     

Paul van Vlissingenstraat 16

   July 18, 2013        15,597      1.0   2.35   5.58

Chemin de l’Epinglier 2

   July 18, 2013        11,328      0.7   2.25   5.57

1125 Energy Park Drive

   March 1, 2032        9,238      0.6   7.62   —     

Gyroscoopweg 2E-2F

   October 18, 2013        9,930      0.6   2.25   5.49

731 East Trade Street

   July 1, 2020        5,368      0.3   8.22   —     
                    
     $ 933,039      58.2    

4.125 % exchangeable senior debentures due 2026

   August 15, 2026        172,500      10.8   6.75   —     

5.50% exchangeable senior debentures due 2029

   April 15, 2029        266,400      16.7   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      2.1   9.32   —     

Unsecured senior notes — Series C

   January 6, 2016        25,000      1.6   9.68   —     

Total Fixed Rate Debt Including Swaps

     $ 1,454,939      91.0    

Unamortized discount on 4.125% exchangeable senior debentures due 2026

    

    (7,674   (0.5 )%     

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

    

    2,167      0.1    
                    

Total Consolidated Debt

     $ 1,599,270      100.0    
                    

Weighted average cost of debt (including interest rate swaps)

   

        5.54
              

 

(1) Assumes all extensions will be exercised.

Credit Facility

(in thousands)

 

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

Revolving Credit Facility

   $ 750,000    $ 587,000    $ 149,838

 

Page 14


DIGITAL REALTY TRUST, INC.

Third 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    Morgan Stanley Bank, National Association      30,000
11    Credit Suisse, Cayman Islands Branch      25,000
12    Société Générale      25,000
13    UBS Loan Finance LLC      25,000
14    Allied Irish Banks, p.l.c.      15,000
15    Chang Hwa Commercial Bank, Ltd., New York Branch      15,000
16    Mega International Commercial Bank Co., Ltd Los Angeles Branch      15,000
17    Comerica Bank      10,000
18    First Commercial Bank New York Agency      10,000
   Total Commitments - Revolving Credit Facility    $ 750,000

 

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

Note: The revolving credit facility has a $515.0 million sub-facility for multi-currency advances.

 

Page 15


DIGITAL REALTY TRUST, INC.

Third Quarter 2009

 

Debt Maturities

(unaudited, in thousands)

 

Property

   2009    2010    2011    2012    2013    Thereafter    Total

Revolving credit facility (1)

   $ —      $ —      $ —      $ 149,838    $ —      $ —      $ 149,838

Secured Term Debt (2)

     621      2,550      2,700      2,836      3,026      132,965      144,698

3 Corporate Place (1)

     —        —        —        —        80,000      —        80,000

200 Paul Avenue 1-4

     395      1,624      1,721      1,812      1,932      70,714      78,198

2045 & 2055 LaFayette Street

     204      835      886      941      999      63,610      67,475

600 West Seventh Street

     330      1,367      1,448      1,535      1,626      49,548      55,854

1100 Space Park Drive

     56      648      687      720      774      52,115      55,000

34551 Ardenwood Boulevard 1-4

     55      639      678      711      765      52,152      55,000

150 South First Street

     148      596      635      677      722      50,129      52,907

114 Rue Ambroise Croizat

     180      720      720      44,598      —        —        46,218

1500 Space Park Drive

     469      1,942      2,067      2,192      35,682      —        42,352

Mundells Roundabout

     —        —        —        —        68,443      —        68,443

2334 Lundy Place

     40      464      493      517      556      37,930      40,000

Unit 9, Blanchardstown Corporate Park

     155      619      619      38,344      —        —        39,737

Unsecured senior notes

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

6 Braham Street

     160      639      19,977      —        —        —        20,776

1201 Comstock Street (1)

     183      762      813      16,162      —        —        17,920

Datacenter Park — Dallas (1)

     —        850      808      15,342      —        —        17,000

Paul van Vlissingenstraat 16

     61      246      246      246      14,798      —        15,597

Chemin de l’Epinglier 2

     44      177      177      177      10,753      —        11,328

Gyroscoopweg 2E-2F

     39      156      156      156      9,423      —        9,930

1125 Energy Park Drive

     35      143      154      8,906      —        —        9,238

731 East Trade Street

     53      235      274      297      323      4,186      5,368

4.125 % exchangeable senior debentures due 2026 (3)

     —        —        172,500      —        —        —        172,500

5.50% exchangeable senior debentures due 2029 (4)

     —        —        —        —        —        266,400      266,400
                                                

Total

   $ 3,228    $ 15,212    $ 232,759    $ 286,007    $ 262,822    $ 804,749    $ 1,604,777
                                                

 

Weighted Average Term to Initial Maturity (3)(4)

   4.3 Years

Weighted Average Term to Initial Maturity (assuming exercise of extension options) (3)(4)

   4.6 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) Assumes maturity of 4.125% exchangeable senior debentures due 2026 at first redemption date in August 2011.
(4) Assumes maturity of 5.50% exchangeable senior debentures due 2029 at first redemption date in April 2014.

Note: Total excludes $2,167 of loan premiums and ($7,674) of debt discount on 4.125% exchangeable senior debentures due 2026.

 

Page 16


DIGITAL REALTY TRUST, INC.

Third Quarter 2009

 

Portfolio Summary

As of September 30, 2009

 

     9/30/2009     6/30/2009  

Number of Properties:

    

Domestic

   64      61   

International

   14      14   
            
   78 (1)    75 (1) 

Number of Buildings:

    

Domestic

   90      81   

International

   18      18   
            
   108      99   

Number of Markets:

    

Domestic

   20      20   

International

   7      7   
            
   27      27   

Net Rentable Square Feet:

    

Domestic

   10,762,478      10,673,413   

International

   1,202,044      1,181,473   
            
   11,964,522      11,854,886   

Redevelopment Square Feet:

    

Domestic

   1,675,243      925,999   

International

   201,642      222,213   
            
   1,876,885      1,148,212   

Portfolio Occupancy (2)

   95.2   94.8

Same Store Pool Occupancy (2)

   95.1   94.7

Average Original Lease Term (years)

   13.8      13.7   

Average Remaining Lease Term (years)

   7.6      7.5   

Lease Expirations (through 2010)

   6.0   8.2

 

(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.

Third Quarter 2009

 

Properties Acquired

For the three months ended September 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 (1)
 

1525 Comstock Street (2)

  Silicon Valley   Sep-09     26.4      42,385   —     99.2

Digital Realty Trust Datacenter Park (4)

  Dallas   Sep-09     1.9 (3)    —     796,226   0.0

444 Toyama Drive

  Silicon Valley   Sep-09     17.5      42,083   —     100.0
                         
      $ 45.8      84,468   796,226   99.6
                         

 

(1) Occupancy percentages are calculated net of square footage held for redevelopment.
(2) Acquisition of remaining portion of joint venture that owns this building. Net rentable square footage has been previously reported.
(3) Represents a portion of the initial contribution to be invested, which will, following additional capital contributions, result in a 60% ownership interest in a joint venture that owns this datacenter park under redevelopment. Since we control the joint venture, we have consolidated the joint venture in the accompanying consolidated financial statements.
(4) The seven buildings at Digital Realty Trust Datacenter Park are considered one property for our property count.

 

Page 18


DIGITAL REALTY TRUST, INC.

Third Quarter 2009

 

Occupancy Analysis

As of September 30, 2009

(Dollar amounts in thousands)

 

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

Property

 

Acquisition

date

 

Metropolitan

Area

  Net Rentable
Square Feet
  Redevelopment
Space
  Annualized Rent
($000) (1)
  As of
09/30/09
    As of
06/30/09
    As of
03/31/09
    As of
12/31/08
    Property
Type
    Total
Portfolio
    Property
Type
    Total
Portfolio
 

Internet Gateway Datacenters

                         

350 East Cermak Road

  May-05   Chicago   1,076,676   57,063   51,933   95.9   90.6   94.0   96.0   27.9   9.0   27.7   11.1

200 Paul Avenue 1-4

  Nov-04   San Francisco   436,299   91,381   23,909   99.9   99.9   95.1   100.0   11.3      3.6      12.8      5.1   

120 E. Van Buren Street

  Jul-06   Phoenix   254,497   33,017   19,443   94.0   91.7   91.7   91.7   6.6      2.1      10.4      4.2   

111 Eighth Avenue (3)

  Mar-07   New York/New Jersey   116,843   —     18,240   100.0   100.0   100.0   100.0   3.0      1.0      9.7      3.9   

600 West Seventh Street

  May-04   Los Angeles   482,089   7,633   16,744   94.4   94.1   94.6   94.6   12.5      4.0      8.9      3.6   

114 Rue Ambroise Croizat

  Dec-06   Paris, France   281,888   70,258   15,617   95.7   99.3   99.1   95.4   7.3      2.4      8.3      3.4   

2323 Bryan Street

  Jan-02   Dallas   457,217   19,890   14,281   78.3   76.4   77.1   77.0   11.9      3.8      7.6      3.1   

1100 Space Park Drive

  Nov-04   Silicon Valley   165,297   —     7,660   100.0   100.0   99.1   99.1   4.3      1.4      4.1      1.6   

600-780 S. Federal

  Sep-05   Chicago   161,547   —     4,745   69.4   69.4   69.4   81.9   4.2      1.5      2.5      1.0   

36 NE 2nd Street

  Jan-02   Miami   162,140   —     4,743   95.9   95.9   95.9   95.9   4.2      1.4      2.5      1.0   

900 Walnut Street

  Aug-07   St Louis   112,266   —     3,614   92.9   97.3   93.5   93.5   2.9      0.9      1.9      0.8   

6 Braham Street

  Jul-02   London, England   63,233   —     3,548   100.0   100.0   100.0   100.0   1.6      0.5      1.9      0.8   

125 North Myers

  Aug-05   Charlotte   25,402   —     1,244   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      0.6      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   
                                                               
      3,856,359   288,374   187,640   93.2   91.7   92.0   93.4   100.0   32.3   100.0   40.4

Corporate Datacenters

                         

43881 Devon Shafron Drive

  Mar-07   Northern Virginia   180,000   —     17,456   98.5   99.0   83.5   100.0   2.6   1.5   7.0   3.8

3 Corporate Place

  Dec-05   New York/New Jersey   276,162   769   14,626   95.6   93.7   89.5   89.5   4.1      2.3      5.9      3.1   

300 Boulevard East

  Nov-02   New York/New Jersey   311,950   —     14,208   100.0   100.0   100.0   100.0   4.6      2.6      5.7      3.1   

833 Chestnut Street

  Mar-05   Philadelphia   588,770   65,988   11,361   86.4   89.5   87.9   87.7   8.7      4.9      4.6      2.4   

43791 Devon Shafron Drive

  Mar-07   Northern Virginia   132,806   2,194   9,752   100.0   100.0   100.0   100.0   2.0      1.1      3.9      2.1   

Clonshaugh Industrial Estate II

  Feb-06   Dublin, Ireland   124,500   —     9,405   100.0   100.0   100.0   100.0   1.8      1.0      3.8      2.0   

2440 Marsh Lane

  Jan-03   Dallas   116,513   18,737   9,163   77.6   77.6   60.0   70.9   1.7      1.0      3.7      2.0   

Unit 9, Blanchardstown Corporate Park

  Dec-06   Dublin, Ireland   120,000   —     8,914   86.2   86.2   95.0   87.3   1.8      1.0      3.6      1.9   

1500 Space Park Drive

  Sep-07   Silicon Valley   51,615   —     8,534   100.0   100.0   100.0   100.0   0.8      0.4      3.4      1.8   

3011 Lafayette Street

  Jan-07   Silicon Valley   90,780   —     8,479   100.0   100.0   100.0   100.0   1.3      0.8      3.4      1.8   

1525 Comstock Street

  Sep-09   Silicon Valley   42,385   —     8,419   99.2   98.3   0.0   0.0   0.6      0.4      3.4      1.8   

4025 Midway Road

  Jan-06   Dallas   87,964   12,626   8,231   99.8   99.8   99.8   99.8   1.3      0.7      3.3      1.8   

2055 East Technology Circle

  Oct-06   Phoenix   76,350   —     7,553   100.0   100.0   100.0   100.0   1.1      0.6      3.0      1.6   

Mundells Roundabout

  Apr-07   London, England   113,464   —     7,241   100.0   100.0   100.0   0.0   1.7      0.9      2.9      1.6   

2045 & 2055 LaFayette Street

  May-04   Silicon Valley   300,000   —     6,480   100.0   100.0   100.0   100.0   4.4      2.5      2.6      1.4   

150 South First Street

  Sep-04   Silicon Valley   179,761   —     5,977   99.5   100.0   100.0   100.0   2.6      1.5      2.4      1.3   

11830 Webb Chapel Road

  Aug-04   Dallas   365,647   —     5,974   95.0   95.0   95.0   95.0   5.4      3.1      2.4      1.3   

14901 FAA Boulevard

  Jun-06   Dallas   263,700   —     4,700   100.0   100.0   100.0   100.0   3.9      2.2      1.9      1.0   

2334 Lundy Place

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

375 Riverside Parkway

  Jun-03   Atlanta   220,016   30,175   4,409   100.0   100.0   100.0   100.0   3.2      1.8      1.8      0.9   

1201 Comstock Street

  Jun-08   Silicon Valley   24,000   —     4,197   100.0   100.0   100.0   0.0   0.4      0.2      1.7      0.9   

44470 Chilum Place

  Feb-07   Northern Virginia   95,440   —     4,003   100.0   100.0   100.0   100.0   1.4      0.8      1.6      0.9   

12001 North Freeway

  Apr-06   Houston   280,483   20,222   3,815   75.4   75.4   95.5   98.5   4.1      2.3      1.5      0.8   

Cressex 1

  Dec-07   London, England   50,847   —     3,680   90.6   90.6   87.2   0.0   0.7      0.4      1.5      0.8   

115 Second Avenue

  Oct-05   Boston   66,730   —     3,437   100.0   100.0   100.0   100.0   1.0      0.6      1.4      0.7   

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      0.7   

8534 Concord Center Drive

  Jun-05   Denver   85,660   —     3,362   100.0   100.0   100.0   100.0   1.3      0.7      1.4      0.7   

365 S. Randolphville Road

  Feb-08   New York/New Jersey   19,354   245,438   3,104   100.0   0.0   0.0   0.0   0.3      0.2      1.3      0.7   

Naritaweg 52

  Dec-07   Amsterdam, Netherlands   63,260   —     2,735   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   

1807 Michael Faraday Court

  Oct-06   Northern Virginia   19,237   —     2,470   97.1   84.1   100.0   100.0   0.3      0.2      1.0      0.5   

Paul van Vlissingenstraat 16

  Aug-05   Amsterdam, Netherlands   77,472   35,000   2,307   58.8   58.8   58.8   58.8   1.1      0.6      0.9      0.5   

200 North Nash Street

  Jun-05   Los Angeles   113,606   —     2,305   100.0   100.0   100.0   100.0   1.7      0.9      0.9      0.5   

210 N Tucker Boulevard

  Aug-07   St Louis   139,588   62,000   2,295   78.4   78.4   94.1   94.1   2.1      1.2      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   

4700 Old Ironsides Drive

  Jun-05   Silicon Valley   90,139   —     1,829   100.0   100.0   100.0   100.0   1.3      0.8      0.7      0.4   

Manchester Technopark, Plot C1

  Jun-08   Manchester, England   38,016   —     1,759   100.0   100.0   100.0   100.0   0.6      0.3      0.7      0.4   

444 Toyama Drive

  Sep-09   Silicon Valley   42,083   —     1,725   100.0   N/A      N/A      N/A      0.6      0.4      0.7      0.4   

 

Page 19


DIGITAL REALTY TRUST, INC.

Third Quarter 2009

 

Occupancy Analysis

As of September 30, 2009

(Dollar amounts in thousands)

 

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

Property

 

Acquisition

date

 

Metropolitan

Area

  Net Rentable
Square Feet
    Redevelopment
Space
  Annualized Rent
($000) (1)
  As of
09/30/09
    As of
06/30/09
    As of
03/31/09
    As of
12/31/08
    Property
Type
    Total
Portfolio
    Property
Type
    Total
Portfolio
 

4650 Old Ironsides Drive

  Jun-05   Silicon Valley   84,383      —       1,712   100.0   100.0   100.0   100.0   1.2      0.7      0.7      0.4   

Chemin de l’Epinglier 2

  Nov-05   Geneva, Switzerland   59,190      —       1,697   100.0   100.0   100.0   100.0   0.9      0.5      0.7      0.4   

7505 Mason King Court

  Nov-08   Northern Virginia   109,650      —       1,694   100.0   100.0   100.0   0.0   1.6      0.9      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      0.6      0.3   

6800 Millcreek Drive

  Apr-06   Toronto, Canada   83,758      —       1,530   100.0   100.0   100.0   100.0   1.2      0.7      0.6      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   1.0      0.6      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      0.9      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   4.6      2.6      0.6      0.3   

Gyroscoopweg 2E-2F

  Jul-06   Amsterdam, Netherlands   55,585      —       1,287   100.0   100.0   100.0   100.0   0.8      0.5      0.5      0.3   

8100 Boone Boulevard

  Oct-06   Northern Virginia   17,015      —       814   100.0   100.0   100.0   100.0   0.3      0.1      0.3      0.2   

600 Winter Street

  Sep-06   Boston   30,400      —       794   100.0   100.0   100.0   100.0   0.4      0.3      0.3      0.2   

2300 NW 89th Place

  Sep-06   Miami   64,174      —       616   100.0   100.0   100.0   100.0   0.9      0.5      0.2      0.1   

7620 Metro Center Drive

  Dec-05   Austin   45,000      —       605   100.0   100.0   100.0   100.0   0.7      0.4      0.2      0.1   

Clonshaugh Industrial Estate

  Feb-06   Dublin, Ireland   20,000      —       512   100.0   100.0   100.0   100.0   0.3      0.2      0.2      0.1   

1 St. Anne’s Boulevard

  Dec-07   London, England   20,219      —       265   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   —        —        —        —     

904 Quality Way

  Sep-09   Dallas   —        46,750     —     0.0   0.0   0.0   0.0   —        —        —        —     

905 Quality Way

  Sep-09   Dallas   —        249,657     —     0.0   0.0   0.0   95.1   —        —        —        —     

650 Randolph Road

  Jun-08   New York/New Jersey   —        127,790     —     0.0   0.0   0.0   0.0   —        —        —        —     

1232 Alma Road

  Sep-09   Dallas   —        105,726     —     0.0   0.0   0.0   0.0   —        —        —        —     

900 Quality Way

  Sep-09   Dallas   —        112,253     —     0.0   0.0   0.0   0.0   —        —        —        —     

1400 N Bowser Way

  Sep-09   Dallas   —        246,940     —     0.0   0.0   0.0   0.0   —        —        —        —     

1301 International Parkway

  Sep-09   Dallas   —        20,500     —     0.0   0.0   0.0   0.0   —        —        —        —     
                                                                   
      6,804,945      1,574,111     248,512   95.7   95.8   96.1   95.1   100.0   56.8   100.0   53.5
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   55.4   1.9

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      0.8   

2010 East Centennial Circle

  May-03   Phoenix   113,405      —       2,852   100.0   100.0   100.0   100.0   17.9      0.9      18.1      0.6   

2 St. Anne’s Boulevard

  Dec-07   London, England   30,612      14,400     400   100.0   100.0   100.0   100.0   4.8      0.3      2.5      0.1   
                                                                   
      634,724      14,400     15,780   100.0   100.0   100.0   100.0   100.0   5.3   100.0   3.4
Technology Office                          

100 & 200 Quannapowitt Parkway

  Jun-04   Boston   386,956      —       7,222   94.9   94.9   94.9   94.9   57.9   3.2   56.8   1.5

4849 Alpha Road

  Apr-04   Dallas   125,538      —       2,856   100.0   100.0   100.0   100.0   18.8      1.1      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   

908 Quality Way

  Sep-09   Dallas   —        14,400     —     0.0   N/A      N/A      N/A      —        —        —        —     
                                                                   
      668,494      14,400     12,722   97.0   97.0   97.0   97.0   100.0   5.6   100.0   2.7
                                                                   

Portfolio Total

/Weighted Average

      11,964,522 (4)    1,891,285   $ 464,654   95.2   94.8   95.1   94.9   100.0   100.0   100.0   100.0
                                                                   

 

(1) Annualized rent represents the monthly contractual rent under existing leases as of September 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 98.4% occupied as of September 30, 2009.

 

Page 20


DIGITAL REALTY TRUST, INC.

Third Quarter 2009

 

Major Tenants

as of September 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    14.2   $ 44,562    9.6   114

2

   Equinix Operating Company, Inc. (3)    4    606,316    5.1   $ 23,081    5.0   98

3

   Qwest Communications International, Inc.    15    637,712    5.3   $ 20,395    4.4   73

4

   Facebook, Inc.    3    134,999    1.1   $ 16,911    3.6   92

5

   NTT Communications Company    4    295,032    2.5   $ 16,671    3.6   66

6

   TelX Group, Inc.    10    120,825    1.0   $ 15,179    3.3   206

7

   JPMorgan Chase & Co.    3    149,935    1.3   $ 14,021    3.0   123

8

   Morgan Stanley    2    92,451    0.8   $ 13,554    2.9   52

9

   AT & T    12    389,375    3.3   $ 11,873    2.6   121

10

   Yahoo! Inc.    2    110,847    0.9   $ 9,763    2.1   97

11

   eircom Limited    1    124,500    1.0   $ 9,405    2.0   118

12

   BT Americas, Inc.    3    47,286    0.4   $ 8,952    1.9   99

13

   T-Systems North America, Inc.    3    82,610    0.7   $ 8,826    1.9   51

14

   Microsoft Corporation    2    313,485    2.6   $ 7,998    1.7   70

15

   Carpathia Hosting    2    37,063    0.3   $ 7,470    1.6   109

16

   HSBC Bank PLC    1    113,464    0.9   $ 7,241    1.6   171

17

   Comverse Technology, Inc.    1    367,033    3.1   $ 7,222    1.6   16

18

   Level 3 Communications, LLC (4)(5)    19    255,423    2.1   $ 6,877    1.5   119

19

   Horizon Data Center Solutions    2    52,077    0.4   $ 6,810    1.5   88

20

   TATA Communications    2    105,366    0.9   $ 6,742    1.5   102
                                  
   Total/Weighted Average       5,737,438    47.9   $ 263,553    56.9   97
                                  

 

(1) Occupied square footage is defined as leases that have commenced on or before September 30, 2009.
(2) Annualized rent represents the monthly contractual rent under existing leases as of September 30, 2009 multiplied by 12.
(3) Equinix Operating Company, Inc. acquired Switch & Data Facilities Company, Inc. on October 20, 2009. On a pro forma basis, total occupied square feet and annualized rent would be 705,069 and $26,526, respectively.
(4) Level 3 Communications includes Wiltel Communications & Broadwing Communications.
(5) 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.

Third 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    Datacenter Park - Dallas    Dallas    40
8    44470 Chilum Place    Northern Virginia    36
9    150 South First Street    Silicon Valley    36
10    101 Aquila Way    Atlanta    30
11    365 South Randolphville Road    New York    26
12    14901 FAA Boulevard    Dallas    25
13    2401 Walsh Street    Silicon Valley    25
14    2403 Walsh Street    Silicon Valley    25
15    4700 Old Ironsides Drive    Silicon Valley    25
   Total Potential Power Capacity - Top 15 Properties    776

 

(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.

Third Quarter 2009

 

Lease Expirations and Lease Distribution

Lease Expirations

As of September 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

      576,626    4.8     —      0.0        

2009 (3)

   105    245,890    2.1     7,590    1.6   $ 30.87      26.97      6,632

2010

   91    471,116    3.9     21,516    4.6   $ 45.67      46.76      22,031

2011

   100    1,260,048    10.5     32,785    7.1   $ 26.02      26.71      33,656

2012

   104    154,920    1.3     15,293    3.3   $ 98.72      105.57      16,355

2013

   78    1,028,730    8.6     51,744    11.1   $ 50.30      55.51      57,106

2014

   89    841,179    7.0     43,375    9.3   $ 51.56      59.09      49,702

2015

   80    1,867,362    15.6     61,985    13.3   $ 33.19      36.66      68,462

2016

   60    843,582    7.1     31,980    6.9   $ 37.91      44.05      37,160

2017

   34    550,868    4.6     17,022    3.7   $ 30.90      36.99      20,377

2018

   48    576,050    4.8     28,189    6.1   $ 48.93      65.07      37,486

Thereafter

   153    3,548,151    29.7     153,175    33.0   $ 43.17      57.90      205,452
                                                 

Portfolio Total / Weighted Average

   942    11,964,522    100.0   $ 464,654    100.0   $ 40.80    $ 48.68    $ 554,419
                                                 

Lease Distribution

As of September 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

        576,626    4.8     —      —     

2,500 or less

   557    59.1   298,231    2.5     41,238    8.9

2,501 - 10,000

   183    19.4   1,032,158    8.6     65,776    14.2

10,001 - 20,000

   68    7.2   1,275,864    10.7     60,108    12.9

20,001 - 40,000

   60    6.4   1,815,098    15.2     95,413    20.5

40,001 - 100,000

   46    4.9   2,904,764    24.3     104,702    22.5

Greater than 100,000

   28    3.0   4,061,781    33.9     97,417    21.0
                                   

Portfolio Total

   942    100.0   11,964,522    100.0   $ 464,654    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 September 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.

Third Quarter 2009

 

Leasing Activity

As of September 30, 2009

 

     For the Three Months
Ended September 30,
2009
    % Leased  

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

   11,233,813        94.8
              

3Q 2009 Acquisitions:

    

444 Toyama

   42,083        100.0
              

Occupied Square Feet including 3Q 2009 Acquisitions (1)

   11,275,896        94.2

Expirations, Terminations and Reductions

   (20,699     (0.2 )% 

New Leases and Expansions

   100,518        0.9

Remeasurements (2)

   32,181        0.3
              

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

   11,387,896        95.2
              

GAAP Rent Growth (3)

    

Expiring Rent per Square Foot

     $ 73.44   

New Rent per Square Foot

     $ 169.96   

Percentage Increase

       131.4

Weighted Average Lease Term - New (in months)

       115   

 

(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.

Third Quarter 2009

 

Tenant Improvements and Leasing Commissions

 

     Three Months Ended    Full Year
2008
     9/30/2009    6/30/2009    3/31/2009    12/31/2008   
Renewals (1)               

Number of renewals

     28      19      13      10      29

Square Feet

     453,840      308,205      163,216      25,866      151,114

Tenant improvement costs per square foot (2)

   $ 2.66    $ 0.17    $ 0.14    $ 3.08    $ 2.17

Leasing commission costs per square foot (2)

   $ 7.35    $ 10.26    $ 6.04    $ 5.38    $ 6.72
                                  

Total renewal lease costs per square foot

   $ 10.01    $ 10.43    $ 6.18    $ 8.46    $ 8.89

New Leases (3)

              

Number of non-redevelopment leases

     8      17      12      12      64

Non-Redevelopment square feet

     2,289      35,875      121,926      135,884      257,354

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

   $ 28.40    $ 12.97    $ 0.57    $ —      $ 12.87

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

   $ 11.55    $ 12.42    $ 2.79    $ 9.85    $ 10.97

Number of redevelopment leases

     17      10      16      13      78

Redevelopment square feet

     98,229      79,255      328,538      184,092      912,942

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

   $ 5.09    $ 14.89    $ 1.35    $ 3.11    $ 2.97

Redevelopment leasing commission costs per square foot (2)

   $ 12.74    $ 20.67    $ 12.39    $ 17.62    $ 11.79
                                  

Total Number of Leases

     25      27      28      25      142

Total Square Feet

     100,518      115,130      450,464      319,976      1,170,296

Total new lease costs per square foot

   $ 18.33    $ 32.39    $ 10.93    $ 16.11    $ 16.76

Total (5)

              

Number of leases

     53      46      41      35      171

Square Feet

     554,358      423,335      613,680      345,842      1,321,410

Tenant improvement costs per square foot (2)

   $ 3.20    $ 4.01    $ 0.87    $ 1.89    $ 4.81

Leasing commission costs per square foot (2)

   $ 8.32    $ 12.39    $ 8.79    $ 13.65    $ 11.05
                                  

Total costs per square foot

   $ 11.52    $ 16.40    $ 9.66    $ 15.54    $ 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.

 

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DIGITAL REALTY TRUST, INC.

Third Quarter 2009

 

Historical Capital Expenditures

 

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

Recurring capital expenditures (1) (2)

   $ 4,803,000    $ 9,628,000    $ 4,779,000    $ 7,380,000    $ 5,489,000    $ 5,272,000    $ 7,349,000

Non-recurring capital expenditures (2)

   $ 66,272,000    $ 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

     11,964,522      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 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.

 

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DIGITAL REALTY TRUST, INC.

Third Quarter 2009

 

Redevelopment Activity

For the quarter ended September 30, 2009

(Square feet)

 

Activity for the quarter ended September 30, 2009

   US     Europe     Total     % Leased (1)  

Redevelopment Space as of June 30, 2009

   925,999      222,213      1,148,212     

Acquired Redevelopment Space and New Construction Space

   796,226      —        796,226     

Converted Redevelopment Space:

        

Turn-Key Datacenter®

   (39,585   (19,760   (59,345   100.0

Powered Base Building®

   (7,397   (811   (8,208   100.0

Remeasurement Adjustments

   —        —        —       
                    

Redevelopment Space as of September 30, 2009

   1,675,243      201,642      1,876,885     
                    

Redevelopment Space Under Construction at Quarter End

   US     Europe     Total     % Leased (2)  

Turn-Key Datacenter®

   90,453      53,000      143,453      46.8

Build-to-Suit

   —        —        —       

New Powered Base Building® Shell

   —        —        —       
                    

Redevelopment Space Under Construction as of September 30, 2009

   90,453      53,000      143,453     
                    

New Development Space Under Construction at Quarter End (3)

   US     Europe     Total        

New Powered Base Building® Shell

   135,000      —        135,000     

 

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

 

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DIGITAL REALTY TRUST, INC.

Third 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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