Capital and Accumulated Other Comprehensive Income (Loss)

(a) Redeemable Preferred Units

6.625% Series F Cumulative Redeemable Preferred Units

On April 5, 2012 and April 18, 2012, the Operating Partnership issued a total of 7,300,000 units of its 6.625% series F cumulative redeemable preferred units, or the series F preferred units, to the General Partner in conjunction with the General Partner’s issuance of an equivalent number of shares of its 6.625% series F cumulative redeemable preferred stock, or the series F preferred stock. Distributions are cumulative on the series F preferred units from the date of original issuance in the amount of $1.65625 per unit each year, which is equivalent to 6.625% of the $25.00 liquidation preference per unit. Distributions on the series F preferred units are payable quarterly in arrears. The first distribution paid on the series F preferred units on June 29, 2012 was a pro rata distribution from and including the original issue date to and including June 30, 2012 in the amount of $0.39566 per unit. The series F preferred units do not have a stated maturity date and are not subject to any sinking fund. The Operating Partnership is required to redeem the series F preferred units in the event that the General Partner redeems the series F preferred stock. The General Partner is not allowed to redeem the series F preferred stock prior to April 5, 2017 except in limited circumstances to preserve the General Partner’s status as a REIT. On or after April 5, 2017, the General Partner may, at its option, redeem the series F preferred stock, in whole or in part, at any time or from time to time, for cash at a redemption price of $25.00 per share, plus all accrued and unpaid dividends on such series F preferred stock up to but excluding the redemption date. Upon liquidation, dissolution or winding up, the series F preferred units will rank senior to the common units with respect to the payment of distributions and other amounts and rank on parity with the Operating Partnership’s series G cumulative redeemable preferred units, series H cumulative redeemable preferred units and series I cumulative redeemable preferred units. Except in connection with specified change of control transactions of the General Partner, the series F preferred units are not convertible into or exchangeable for any other property or securities of the Operating Partnership.

5.875% Series G Cumulative Redeemable Preferred Units

On April 9, 2013, the Operating Partnership issued a total of 10,000,000 of its 5.875% series G cumulative redeemable preferred units, or the series G preferred units, to the General Partner in conjunction with the General Partner’s issuance of an equivalent number of shares of its 5.875% series G cumulative redeemable preferred stock, or the series G preferred stock. Distributions are cumulative on the series G preferred units from the date of original issuance in the amount of $1.46875 per unit each year, which is equivalent to 5.875% of the $25.00 liquidation preference per unit. Distributions on the series G preferred units are payable quarterly in arrears. The first distribution paid on the series G preferred units on June 28, 2013 was a pro rata distribution from and including the original issue date to and including June 30, 2013 in the amount of $0.334550 per unit. The series G preferred units do not have a stated maturity date and are not subject to any sinking fund. The Operating Partnership is required to redeem the series G preferred units in the event that the General Partner redeems the series G preferred stock. The General Partner is not allowed to redeem the series G preferred stock prior to April 9, 2018 except in limited circumstances to preserve the General Partner’s status as a REIT. On or after April 9, 2018, the General Partner may, at its option, redeem the series G preferred stock, in whole or in part, at any time or from time to time, for cash at a redemption price of $25.00 per share, plus all accrued and unpaid dividends on such series G preferred stock up to but excluding the redemption date. Upon liquidation, dissolution or winding up, the series G preferred units will rank senior to the Operating Partnership’s common units with respect to the payment of distributions and other amounts and rank on parity with the Operating Partnership’s series F cumulative redeemable preferred units, series H cumulative redeemable preferred units and series I cumulative redeemable preferred units. Except in connection with specified change of control transactions of the General Partner, the series G preferred units are not convertible into or exchangeable for any other property or securities of the Operating Partnership.

7.375% Series H Cumulative Redeemable Preferred Units

On March 26, 2014 and April 7, 2014, the Operating Partnership issued in the aggregate a total of 14,600,000 of its 7.375% series H cumulative redeemable preferred units, or the series H preferred units, to the General Partner in conjunction with the General Partner’s issuance of an equivalent number of shares of its 7.375% series H cumulative redeemable preferred stock, or the series H preferred stock. Distributions are cumulative on the series H preferred units from the date of original issuance in the amount of $1.84375 per unit each year, which is equivalent to 7.375% of the $25.00 liquidation preference per unit. Distributions on the series H preferred units are payable quarterly in arrears. The first distribution payable on the series H preferred units on June 30, 2014 was a pro rata distribution from and including the original issue date to and including June 30, 2014 in the amount of $0.48655 per unit. The series H preferred units do not have a stated maturity date and are not subject to any sinking fund. The Operating Partnership is required to redeem the series H preferred units in the event that the General Partner redeems the series H preferred stock. The General Partner is not allowed to redeem the series H preferred stock prior to March 26, 2019 except in limited circumstances to preserve the General Partner’s status as a REIT. On or after March 26, 2019, the General Partner may, at its option, redeem the series H preferred stock, in whole or in part, at any time or from time to time, for cash at a redemption price of $25.00 per share, plus all accrued and unpaid dividends on such series H preferred stock up to but excluding the redemption date. Upon liquidation, dissolution or winding up, the series H preferred units will rank senior to the Operating Partnership’s common units with respect to the payment of distributions and other amounts and rank on parity with the Operating Partnership’s series F cumulative redeemable preferred units, series G cumulative redeemable preferred units and series I cumulative redeemable preferred units. Except in connection with specified change of control transactions of the General Partner, the series H preferred units are not convertible into or exchangeable for any other property or securities of the Operating Partnership.

6.350% Series I Cumulative Redeemable Preferred Units

On August 24, 2015, the General Partner completed an underwritten public offering of 10,000,000 shares of series I cumulative redeemable preferred stock, or the series I preferred stock, for net proceeds of approximately $242.0 million after deducting the underwriting discount. The General Partner used the net proceeds from the offering to fund a portion of the aggregate purchase price for the Telx Acquisition. Pending the closing of the Telx Acquisition, the General Partner loaned the net proceeds from the series I preferred stock offering of approximately $242.7 million to the Operating Partnership. The intercompany note was scheduled to mature on January 11, 2016 with an interest rate of 4.50% per annum. On October 8, 2015, the Operating Partnership repaid the intercompany note in full, with accrued interest, in the amount of $244.1 million. On October 13, 2015, in connection with the consummation of the Operating Partnership Merger (see note 7), the Operating Partnership issued to the General Partner 10,000,000 series I cumulative redeemable preferred units, or the series I preferred units, with substantially identical terms as the series I preferred stock. Distributions are cumulative on the series I preferred units from the date of original issuance in the amount of $1.5875 per unit each year, which is equivalent to 6.350% of the $25.00 liquidation preference per unit. Distributions on the series I preferred units are payable quarterly in arrears. The first distribution payable on the series I preferred units on December 31, 2015 was a pro rata distribution from and including the original issue date to and including December 31, 2015 in the amount of $0.56003 per unit. The series I preferred units do not have a stated maturity date and are not subject to any sinking fund. The Operating Partnership is required to redeem the series I preferred units in the event that the General Partner redeems the series I preferred stock. The General Partner is not allowed to redeem the series I preferred stock prior to August 24, 2020 except in limited circumstances to preserve the General Partner’s status as a REIT. On or after August 24, 2020, the General Partner may, at its option, redeem the series I preferred stock, in whole or in part, at any time or from time to time, for cash at a redemption price of $25.00 per share, plus all accrued and unpaid dividends on such series I preferred stock up to but excluding the redemption date. Upon liquidation, dissolution or winding up, the series I preferred units will rank senior to the Operating Partnership’s common units with respect to the payment of distributions and other amounts and rank on parity with the Operating Partnership’s series F cumulative redeemable preferred units, series G cumulative redeemable preferred units and series H cumulative redeemable preferred units. Except in connection with specified change of control transactions of the General Partner, the series I preferred units are not convertible into or exchangeable for any other property or securities of the Operating Partnership.

(b) Allocations of Net Income and Net Losses to Partners

Except for special allocations to holders of profits interest units described below in note 13(a) under the heading “Incentive Plan-Long-Term Incentive Units,” the Operating Partnership’s net income will generally be allocated to the General Partner to the extent of the accrued preferred return on its preferred units, and then to the General Partner and the Operating Partnership’s limited partners in accordance with the respective percentage interests in the common units issued by the Operating Partnership. Net loss will generally be allocated to the General Partner and the Operating Partnership’s limited partners in accordance with the respective common percentage interests in the Operating Partnership until the limited partner’s capital is reduced to zero and any remaining net loss would be allocated to the General Partner. However, in some cases, losses may be disproportionately allocated to partners who have guaranteed our debt. The allocations described above are subject to special allocations relating to depreciation deductions and to compliance with the provisions of Sections 704(b) and 704(c) of the Code, and the associated Treasury Regulations.

Limited partners have the right to require the Operating Partnership to redeem part or all of their common units for cash based on the fair market value of an equivalent number of shares of the General Partner’s common stock at the time of redemption. Alternatively, the General Partner may elect to acquire those common units in exchange for shares of the General Partner’s common stock on a one-for-one basis, subject to adjustment in the event of stock splits, stock dividends, issuance of stock rights, specified extraordinary distributions and similar events. Pursuant to authoritative accounting guidance, the Operating Partnership evaluated whether it controls the actions or events necessary to issue the maximum number of shares that could be required to be delivered under the share settlement of the limited partners’ common units and the vested incentive units. Based on the results of this analysis, the Operating Partnership concluded that the common and vested incentive Operating Partnership units met the criteria to be classified within capital.

The redemption value of the limited partners’ common units and the vested incentive units was approximately $226.3 million and $192.7 million based on the closing market price of Digital Realty Trust, Inc.’s common stock on December 31, 2016 and 2015, respectively.

(d) Distributions

All distributions on our units are at the discretion of Digital Realty Trust, Inc.’s board of directors. We have declared and paid the following distributions on our common and preferred units for the years ended December 31, 2016, 2015 and 2014 (in thousands):



Date distribution declared	Distribution payable date	Series E Preferred Units			Series F Preferred Units		Series G Preferred Units		Series H Preferred Units			Series I Preferred Units			Common Units
February 11, 2014	March 31, 2014	$	5,031		$	3,023	$	3,672	$	—		$	—		$	109,378	⁽¹⁾
April 29, 2014	June 30, 2014	5,031			3,023		3,672		7,104		⁽²⁾	—			115,008		⁽¹⁾
July 21, 2014	September 30, 2014	5,031			3,023		3,672		6,730			—			115,012		⁽¹⁾
November 4, 2014	December 31, 2014 for Preferred Units; January 15, 2015 for Common Units	5,031			3,023		3,672		6,730			—			115,016		⁽¹⁾
		$	20,124		$	12,092	$	14,688	$	20,564		$	—		$	454,414
February 25, 2015	March 31, 2015	$	5,031		$	3,023	$	3,672	$	6,730		$	—		$	117,896	⁽³⁾
May 12, 2015	June 30, 2015	5,031			3,023		3,672		6,730			—			117,938		⁽³⁾
August 11, 2015	September 30, 2015	5,031			3,023		3,672		6,730			—			117,962		⁽³⁾
November 12, 2015	December 31, 2015 for Preferred Units; January 15, 2016 for Common Units	5,031			3,023		3,672		6,730			5,600		⁽⁴⁾	126,827		⁽³⁾
		$	20,124		$	12,092	$	14,688	$	26,920		$	5,600		$	480,623
February 17, 2016	March 31, 2016	$	5,031		$	3,023	$	3,672	$	6,730		$	3,969		$	131,587	⁽⁵⁾
May 11, 2016	June 30, 2016	5,031			3,023		3,672		6,730			3,969			131,607		⁽⁵⁾
August 10, 2016	September 30, 2016	—		⁽⁶⁾	3,023		3,672		6,730			3,969			131,657		⁽⁵⁾
November 9, 2016	December 31, 2016 for Preferred Units; January 13, 2017 for Common Units	—			3,023		3,672		6,730			3,969			144,193		⁽⁵⁾
		$	10,062		$	12,092	$	14,688	$	26,920		$	15,876		$	539,044

Annual rate of distribution per unit		$1.750			$1.656		$1.469		$1.844			$1.588


(1)	$3.320 annual rate of distribution per unit.


(2)	Represents a pro rata distribution from and including the original issue date to and including June 30, 2014.


(3)	$3.400 annual rate of distribution per unit.


(4)	Represents a pro rata distribution from and including the original issue date to and including December 31, 2015.


(5)	$3.520 annual rate of distribution per unit.

(6)

Redeemed on September 15, 2016 for $25.35972 per unit, or a redemption price of $25.00 per unit, plus accrued and unpaid distributions up to but not including the redemption date of approximately $4.1 million in the aggregate. In connection with the redemption, the previously incurred offering costs of approximately $10.3 million were deducted in the computation of net income available to common unitholders.

(f) Accumulated Other Comprehensive Income (Loss)

The accumulated balances for each item within other comprehensive income (loss) are as follows (in thousands):



	Foreign currency translation adjustments			Cash flow hedge adjustments			Accumulated other comprehensive income (loss)
Balance as of December 31, 2014	$	(42,138	)	$	(6,295	)	$	(48,433	)
Net current period change	(51,745		)	(3,407		)	(55,152		)
Reclassification to interest expense from interest rate swaps	—			2,621			2,621
Balance as of December 31, 2015	$	(93,883	)	$	(7,081	)	$	(100,964	)
Net current period change	(86,621		)	41,998			(44,623		)
Reclassification to interest expense from interest rate swaps	—			4,968			4,968
Balance as of December 31, 2016	$	(180,504	)	$	39,885		$	(140,619	)