Acquisitions and Dispositions of Properties

12 Months Ended

Dec. 31, 2024

Acquisitions and Dispositions of Properties

Acquisitions and Dispositions of Properties

7. Acquisitions and Dispositions of Properties

Acquisitions of Properties

For the years ended December 31, 2024, 2023 and 2022, acquisitions of properties that did not qualify as business combinations were immaterial to our financial statements – both individually and in the aggregate.

In January 2024, we acquired a 16-acre site in Paris for $80 million. Prior to the acquisition, we leased the land, which consisted of two completed data centers and two data centers under construction. As a result of the land acquisition, we derecognized the right-of-use assets and lease liabilities of $145 million and $150 million, respectively.

In July 2024, the Company acquired two data centers located in the Slough Trading Estate for $200 million. The newly acquired campus features two individual data centers with a combined capacity of 15 megawatts (MW).

Disposition of Other Properties

The Company sold or contributed the following other real estate properties during the years ended December 31, 2024, 2023 and 2022:

		Date Sold /	Gross Proceeds / Fair Value			Gain on Sale / contribution
Property Type	Metro Area	contributed	(in millions)			(in millions)
Joint venture contributions	Various	2024	$	1,246.4	(1)	$	304.1
Brookfield transaction	Various	2024		271.0			191.6
Non-core assets	Various	2024		158.7			(1.0)
Sale of noncontrolling interest in property	Frankfurt	2024		497.5	(2)		101.1
Joint venture contributions	Various	2023		2,278.5	(3)		814.0
Non-core assets	Various	2023		341.3			86.6
Non-core assets	Dallas	2022		203.0			174.0
Other	Various	2022		2.8			2.8

(1) Includes Blackstone Inc., GI Partners, and Mitsubishi Corporation.

(2) Includes sale of noncontrolling interest in DCREIT (see Note 8. “Investments in Unconsolidated Entities”).

(3) Includes GI Partners, Realty Income, and TPG Real Estate.

2024 Dispositions

Blackstone Inc. Joint Venture – On January 11, 2024, we formed a joint venture with Blackstone Inc. to develop four hyperscale data center campuses across Frankfurt, Paris and Northern Virginia. The campuses are planned to support the construction of 10 data centers with approximately 500 megawatts of potential IT load capacity. The first phase of the joint venture closed on hyperscale data center campuses in Paris and Northern Virginia. We received approximately $231 million of net proceeds from the contribution of our data centers to the first phase of the joint venture and retained a 20% interest in the joint venture. As a result of transferring control, we derecognized the data centers and recognized a loss on disposition of approximately $0.3 million. In the fourth quarter, the second phase of the joint venture closed on hyperscale data center campuses in Frankfurt and Northern Virginia. We received approximately $385 million of net proceeds from the contribution of our data centers to the second phase of the joint venture and retained a 20% interest in the joint venture. As a result of transferring control, we derecognized the data centers and recognized a gain on disposition of approximately $44.5 million.

Brookfield Transaction – In January 2024, we closed on the sale of our interest in four data centers to Brookfield Infrastructure Partners L.P., or Brookfield, for approximately $271 million. Two of the data centers were consolidated by us; while two of the data centers were owned by Digital Core REIT (see Note 8. “Investments in Unconsolidated Entities”). The sale was completed subsequent to Brookfield’s November 2023 acquisition of one of our customers, Cyxtera Technologies. The acquisition was part of Cyxtera’s plan of reorganization under its Chapter 11 bankruptcy proceedings. In conjunction with the sale, we bought out Cyxtera’s leases in three data centers located in Singapore and Frankfurt for approximately $57 million. In addition, Brookfield assumed the leases on three facilities previously leased to Cyxtera and amended the leases on three additional data centers in North America, accelerating the expiration date to

September 2024. As a result of the sale, we recognized a total gain on disposition of approximately $200.5 million, of which $191.6 million is included within Gain on disposition of properties, net and $8.9 million is included within Equity in (loss) earnings of unconsolidated entities on our condensed consolidated income statements.

Mitsubishi Joint Venture – On March 1, 2024, we formed a joint venture with Mitsubishi Corporation, or Mitsubishi, to support the development of two data centers in the Dallas metro area. The facilities were 100% pre-leased prior to construction. We contributed the two data center buildings at a contribution value of approximately $261 million. We received approximately $153 million of gross proceeds from the contribution of our data centers to the joint venture and retained a 35% interest in the joint venture. Mitsubishi paid such cash in exchange for a 65% interest in the joint venture. As a result of transferring control, we derecognized the data centers and recognized a gain on disposition of approximately $7.0 million.

GI Partners Joint Venture – On April 16, 2024, we expanded our existing joint venture with GI Partners with the sale to GI Partners of a 75% interest in an additional facility in Chicago. We contributed the data center at a value of approximately $453 million. We received approximately $386 million of net proceeds from the contribution of our data center to the joint venture and the associated financing and retained a 25% interest in the joint venture. As a result of transferring control, we derecognized the data center and recognized a gain on disposition of approximately $172 million.

2023 Dispositions

GI Partners Joint Venture – On July 13, 2023, we formed a joint venture with GI Partners, and GI Partners acquired a 65% interest in two stabilized hyperscale data center buildings in the Chicago metro area that we contributed. We received approximately $0.7 billion of gross proceeds from the contribution of our data centers to the joint venture and the associated financing and retained a 35% interest in the joint venture. As a result of transferring control, we derecognized the data centers and recognized a gain on disposition of approximately $238 million. We also granted GI Partners an option to purchase an interest in the third facility on the same hyperscale data center campus in Chicago. In addition, GI Partners has a call option to increase their ownership interest in the joint venture from 65% to 80%. The call option top-up election notice was delivered to the Company on December 21, 2023. On January 12, 2024, GI Partners made an additional cash capital contribution in the amount of $68 million, resulting in an additional 15% ownership in the joint venture. Currently, GI Partners has an 80% interest in the joint venture, and we have retained a 20% interest. We perform the day-to-day accounting and property management functions for the joint venture and, as such, will earn a management fee.

TPG Real Estate Joint Venture – On July 25, 2023, we formed a joint venture with TPG Real Estate, and TPG Real Estate acquired an 80% interest in three stabilized hyperscale data center buildings in Northern Virginia that we contributed. We received approximately $1.4 billion of gross proceeds from the contribution of our data centers to the joint venture and the associated financing and retained a 20% interest in the joint venture. As a result of transferring control, we derecognized the data centers and recognized a gain on disposition of approximately $576 million. We perform the day-to-day accounting and property management functions for the joint venture and, as such, will earn a management fee.

Realty Income Joint Venture - On November 10, 2023, we formed a joint venture with Realty Income to support the development of two data centers in Northern Virginia. The facilities were 100% pre-leased prior to construction. We contributed the two data center buildings at a purchase price of $185 million, which represented costs spent through November 10, 2023, to the new joint venture. We received approximately $148 million of gross proceeds from the contribution of our data centers to the joint venture and retained a 20% interest in the joint venture. Realty Income contributed such cash to the joint venture in exchange for an 80% interest in the joint venture. Each partner will fund its pro rata share of the remaining $150 million estimated development cost for the first phase of the project, which was completed in mid-2024. We perform the day-to-day accounting and property management functions for the joint venture and, as such, will earn a management fee.