DIGITAL REALTY TRUST INC
For the period ended Dec 31, 2024. Filed Feb 25, 2025.
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A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2024 · Filed Feb 25, 2025
DLR$174.20-0.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2023-12-31; filed 2024-02-23.
0001558370-24-001575
ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2024-12-31; filed 2025-02-25.
0001558370-25-001424
ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 157 previous paragraphs and 167 current paragraphs.
106 unchanged; 36 reworded; 22 added; 14 removed; 1 previous and 3 current paragraphs rearranged.
Tables are not compared: 69 previous and 97 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (22)
Current report
closed on the sale to DCREIT of an additional 15.1% interest in a data center located in Frankfurt, Germany for approximately $77 million. The transaction valued the Frankfurt facility at €470 million or $498 million (at 100% share). Including two prior investments, DCREIT now owns a 65% interest in this Frankfurt data center. We have retained a 35% interest in the Frankfurt facility. As a result of transferring control, we derecognized the Frankfurt facility and recognized a gain on disposition of approximately $101 million; and
Current report
Note: Table excludes data centers held for sale. Individual items may not add up to total due to rounding.
Current report
Total stabilized property taxes and insurance increased by approximately $21.2 million compared to the same period in 2023 due to a favorable property tax assessment at one of our North American properties realized in early 2023.
Current report
Total non-stabilized property taxes and insurance decreased $36.8 million compared to the same period in 2023 primarily related to properties sold or contributed after December 31, 2023.
Current report
During the year ended December 31, 2024, we recognized impairment charges of approximately $191.2 million, which is recorded as provision for impairment on the consolidated income statement. We determined that certain non-core properties in secondary U.S. markets had carrying amounts that may not be fully recoverable as we determined that we no longer intend to hold these properties long-term. Accordingly, the recorded amounts were reduced to reflect management’s estimate of fair value principally based on sales of similar properties and ongoing negotiations with third parties.
Current report
Equity in earnings (loss) of unconsolidated entities decreased approximately $90.3 million compared to the same period in 2023. The foreign exchange remeasurement of debt associated with our unconsolidated Ascenty entity creates volatility in our equity in earnings and drove this fluctuation.
Current report
Gain on disposition of properties, net decreased approximately $304.7 million as compared to the same period in 2023.
Current report
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. As a result of the sale, we recognized a total gain on disposition of approximately $191.6 million.
Current report
In March 2024, we formed a joint venture with Mitsubishi Corporation, or Mitsubishi, to support the development of two data centers in the Dallas metro area. We received approximately $153 million of gross proceeds from the contribution of our data centers to 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.
Current report
In March 2024, we also recognized a total gain of $74.4 million from the sale of an easement to a local power provider in Northern Virginia.
Current report
In April 2024, we expanded our existing joint venture with GI Partners with the sale to GI Partners of a 75% interest in a third facility on the same hyperscale data center campus 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.
Current report
In December 2024, the second phase of the Blackstone Inc. 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.
Current report
In December 2024, we also closed on the sale to DCREIT of an additional 15.1% interest in a data center located in Frankfurt, Germany for approximately $77 million. As a result of transferring control, we derecognized the Frankfurt facility and recognized a gain on disposition of approximately $101 million.
Current report
Loss on debt extinguishment and modifications was approximately $5.9 million for the year ended December 31,2024. In January 2024, we paid down $240 million on the U.S. term loan facility. The paydown resulted in an early extinguishment charge of approximately $1.0 million. In September 2024, we paid down €375 million on the Euro Term Loan Facilities, leaving €375 million outstanding. The paydown resulted in an early extinguishment charge of approximately $1.6 million. We also refinanced our Global Revolving Credit Facilities and wrote off deferred loan costs of approximately $1.1 million. In November 2024, we paid off the remaining $500 million on the U.S. term loan facility. As a result, approximately $2.2 million of deferred financing costs was written off.
Current report
The 2023 Sales Agreement was amended on February 23, 2024 (the “Sales Agreement Amendment”). At the time of the amendment, $258.3 million remained unsold under the 2023 Sales Agreement. Following the Sales Agreement Amendment, Digital Realty Trust, Inc. could issue and sell common stock having an aggregate offering price of up to $2.0 billion through various named agents from time to time pursuant to the 2023 Sales Agreement. During the year ended December 31, 2024, Digital Realty Trust, Inc. generated net proceeds of approximately $1.9 billion from the issuance of approximately 11.4 million common shares under the 2023 Sales Agreement at an average price, net of commissions, of $166.85 per share. Commissions to the agents amounted to approximately $17.4 million. The proceeds from the issuances under the 2023 Sales Agreement for the year ended December 31, 2024, were contributed to our Operating Partnership in exchange for the issuance of approximately 11.4 million common units to our Parent Company.
Current report
On December 23, 2024, our Parent and our Operating Partnership entered into a new an ATM Equity Offering SM Sales Agreement (the “2024 Sales Agreement”), pursuant to which, Digital Realty Trust, Inc. can issue and sell common stock having an aggregate offering price of up to $3.0 billion through various named agents from time to time. The 2023 Sales Agreement was terminated in connection with entry into the 2024 Sales Agreement, and at the time of such termination, $76.5 million remained unsold under the 2024 Sales Agreement. As of December 31, 2024, $3.0 billion remains available for future sales under the 2024 Sales Agreement.
Current report
The sales of common stock made under the 2024 Sales Agreement will be made in “at the market” offerings as defined in Rule 415 of the Securities Act. Our Parent has used and intends to use the net proceeds from the program to temporarily repay borrowings under our Operating Partnership’s Global Revolving Credit Facilities, to acquire additional properties or businesses, to fund development opportunities and for working capital and other general corporate purposes, including potentially for the repayment of other debt or the repurchase, redemption or retirement of outstanding debt securities.
Current report
On May 7, 2024, our Parent and our Operating Partnership entered into an underwriting agreement with BofA Securities, Inc., Citigroup Global Markets Inc. and J.P. Morgan Securities LLC, as representatives of the several underwriters relating to the sale of up to approximately 12.1 million shares of common stock (including approximately 1.6 million additional shares that the underwriters had the option to purchase, and which option was exercised in full on May 8, 2024), at a purchase price to the underwriters of $136.66 per share. The offering closed on May 10, 2024, and we received net proceeds of approximately $1.7 billion.
Current report
On September 13, 2024, Digital Dutch Finco B.V., an indirect wholly owned finance subsidiary of the Operating Partnership, issued and sold €850 million aggregate principal amount of 3.875% Guaranteed Notes due 2033. Net proceeds from the offering were approximately €843 million (approximately $933 million based on the exchange rate on September 13, 2024) after deducting managers’ discounts and estimated offering expenses. We used the net proceeds from the offering to pay down a portion of our Euro Term Loan Facilities, temporarily repay borrowings under our Global Revolving Credit Facility and for general corporate purposes.
Current report
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, while the second phase closed in the fourth quarter of 2024. 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. Each partner funded its pro rata share of the remaining $3.0 billion estimated development cost for the first phase of the joint venture, which is slated for completion in various stages, contingent on customer demand, which began in the first quarter of 2024. 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.
Current report
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. 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.
Current report
Cash provided by operating activities in 2024 increased $626.7 million over 2023. The year-over-year increase was driven by:
Removed paragraphs (14)
Previous report
Total property taxes and insurance increased by approximately $24.7 million compared to the same period in 2022 primarily due to accruals for anticipated assessment increases in 2023, mainly within the Chicago metro area.
Previous report
Equity in earnings (loss) of unconsolidated entities decreased approximately $16.3 million compared to the same period in 2022. Depreciation associated with new joint ventures, delivery of assets under construction and accelerated depreciation at one entity related to a customer bankruptcy drove this fluctuation.
Previous report
Gain on disposition of properties, net increased approximately $723.8 million as compared to the same period in 2022.
Previous report
In August 2022, we sold a non-core building in Dallas for net proceeds of approximately $203 million resulting in a net gain on sale of approximately $174 million.
Previous report
On September 13, 2021, Digital Realty Trust, Inc. completed an underwritten public offering of approximately 6.3 million shares of its common stock, all of which were offered in connection with forward sale agreements it entered into with certain financial institutions acting as forward purchasers. The forward purchasers borrowed and sold an aggregate of approximately 6.3 million shares of Digital Realty Trust, Inc.’s common stock in the public offering. Digital Realty Trust, Inc. did not receive any proceeds from the sale of our common stock by the forward purchasers in the public offering. During the year ended December 31, 2022, we fully settled the forward sale agreements by issuing approximately 6.3 million shares, resulting in proceeds of approximately $939.0 million. Upon physical settlement of the forward sale agreements, the Operating Partnership issued general partner common partnership units to Digital Realty Trust, Inc. in exchange for contribution of the net proceeds.
Previous report
On October 25, 2022, the Company, the Operating Partnership, and certain of the Operating Partnership’s subsidiaries entered into an escrow agreement, pursuant to which the Operating Partnership delivered executed signature pages to a new term loan agreement to be held in escrow upon satisfaction of specific terms. On January 9, 2023, the terms and conditions of the agreement were satisfied, and, on such date, the term loan was deemed executed and became effective. The USD Term Loan Facility provides for a $740 million senior unsecured term loan facility and borrowings in U.S. dollars. The USD Term Loan Facility will mature on March 31, 2025, subject to one twelve-month extension at the Operating Partnership’s option; provided, that the Operating Partnership must pay a 0.1875% extension fee based on the then-outstanding principal amount of the term loans under the USD Term Loan Facility.
Previous report
In December 2022, Teraco entered into a syndicated loan facility worth R11.8 billion (approximately $681 million based on the exchange rate on December 6, 2022), of which R5.7 billion (approximately $329 million based on the exchange rate on December 6, 2022) was used to finance the company’s continued growth and R6.1 billion (approximately $329 million based on the exchange rate on December 6, 2022) refinanced and extended the average maturity profile of existing drawn debt. The new facility matures in December 2028.
Previous report
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. We perform the day-to-day accounting and property management functions for the joint venture and, as such, will earn a management fee.
Previous report
On July 26, 2023, we fully settled the forward sale agreements by issuing approximately 3.5 million shares, resulting in proceeds of approximately $336 million.
Previous report
(i)a decrease in spend due to the completion of the Teraco acquisition in August 2022 for approximately $1.7 billion;
Previous report
(ii)an increase in spend on development projects of approximately $883 million;
Previous report
(iii)a decrease in cash contributed to various investments in unconsolidated entities;
Previous report
(iv)an increase in cash provided by the contribution of data centers to our joint ventures with GI Partners, TPG Real Estate and Realty Income, for gross proceeds of approximately $0.7 billion, $1.4 billion, and $0.2 billion, respectively; and
Previous report
(v)the sale of three non-core assets for gross proceeds of approximately $341 million.
Reworded paragraphs (36)
Previous wording
Digital Realty Trust, Inc., through its controlling interest in Digital Realty Trust, L.P. and its subsidiaries, delivers comprehensive space, power, and interconnection solutions that enable its customers and partners to connect with each other and service their own customers on a global technology and real estate platform. We are a leading global provider of data center, colocation and interconnection solutions for customers across a variety of industry verticals. Digital Realty Trust, Inc. operates as a REIT for federal income tax purposes, and our Operating Partnership is the entity through which we conduct our business and own our assets.
Current wording
Digital Realty Trust, Inc., through its controlling interest in Digital Realty Trust, L.P. and its subsidiaries, delivers comprehensive space, power, and interconnection solutions that enable its customers and partners to connect with each other and service their own customers on a global technology and real estate platform. We are a leading global provider of data center, colocation and interconnection solutions for customers across a variety of industry verticals. Digital Realty Trust, Inc. operates as a REIT for U.S. federal income tax purposes, and our Operating Partnership is the entity through which we conduct our business and own our assets.
Previous wording
Equity in earnings of unconsolidated entities, gain on disposition of properties, interest expense, and income tax expense make up the majority of Other income/(expenses). Equity in earnings of unconsolidated entities represents our share of the income/(loss) of entities in which we invest, but do not consolidate under U.S. GAAP. The largest of these investments is currently our investment in Ascenty, which is located primarily in Latin America. Our second-largest equity-method investment is Digital Core REIT, which is publicly traded on the Singapore Exchange (“SGX”) and which owns a portfolio of 12 properties operating in the United States, Canada, Germany and Japan. Refer to additional discussion of Digital Core REIT and Ascenty in the Notes to the Consolidated Financial Statements.
Current wording
Equity in earnings of unconsolidated entities, gain on disposition of properties, interest expense, and income tax expense make up the majority of Other income/(expenses). Equity in earnings of unconsolidated entities represents our share of the income/(loss) of entities in which we invest, but do not consolidate under U.S. GAAP. The largest of these investments is currently our investment in Ascenty, which is located primarily in Latin America. Our second-largest equity-method investment is Digital Core REIT, which is publicly traded on the Singapore Exchange (“SGX”) and which owns a portfolio of 10 properties operating in the United States, Canada, Germany and Japan. Refer to additional discussion of Digital Core REIT and Ascenty in the Notes to the Consolidated Financial Statements.
Previous wording
Total operating revenues increased by approximately $785.2 million for the year ended December 31, 2023 compared to the same period in 2022.
Current wording
Total operating revenues increased by approximately $77.9 million for the year ended December 31, 2024 compared to the same period in 2023.
Previous wording
Stabilized rental and other services revenue increased by $513.2 million for the year ended December 31, 2023 compared to the same period in 2022 primarily due to an increase of:
Current wording
Stabilized rental and other services revenue decreased by $62.8 million for the year ended December 31, 2024 compared to the same period in 2023 primarily due to:
Previous wording
Non-stabilized rental and other services revenue increased $254.3 million for the year ended December 31, 2023, compared to the same period in 2022, driven primarily by:
Current wording
Non-stabilized rental and other services revenue increased $115.1 million for the year ended December 31, 2024, compared to the same period in 2023, driven primarily by:
Previous wording
Property level operating expenses include costs to operate and maintain the properties in our portfolio as well as taxes and insurance. Many of our lease agreements allow us to pass through expenses to our customers. Reimbursement revenue increased 31% in 2023 compared to the same period in 2022, mitigating a portion of the expense growth shown above.
Current wording
Property level operating expenses include costs to operate and maintain the properties in our portfolio as well as taxes and insurance.
Previous wording
Total stabilized utilities expenses increased by approximately $320.7 million compared to the same period in 2022 primarily due to higher rates and an increase in utility consumption at certain properties in the stabilized portfolio.
Current wording
Total stabilized utilities expenses decreased by approximately $183.3 million compared to the same period in 2023 primarily due to lower power pricing at certain properties in the stabilized portfolio, mainly in EMEA and APAC.
Previous wording
Total non-stabilized utilities expenses increased by approximately $146.1 million compared to the same period in 2022 primarily due to (i) an increase of $72.4 million due to the completion of our global development pipeline and related lease up operating activities (the markets with the biggest contributions were Northern Virginia, Portland, Frankfurt, London and Paris); (ii) $42.1 million generated as a result of the Teraco acquisition in August 2022; and (iii) offset by power agreement credits that decreased $31.6 million.
Current wording
Total non-stabilized utilities expenses increased by approximately $44.9 million compared to the same period in 2023 primarily due to:
Previous wording
Total stabilized rental property operating and maintenance expenses (excluding utilities) increased by approximately $46.9 million compared to the same period in 2022 primarily due to an increase in data center labor and common area maintenance expense. Total non-stabilized rental property operating and maintenance expenses (excluding utilities) increased $42.2 million compared to the same period in 2022 primarily due to higher lease and common area maintenance expense in a growing portfolio of recently completed development sites.
Current wording
Total non-stabilized rental property operating and maintenance expenses (excluding utilities) increased by approximately $24.2 million compared to the same period in 2023 primarily due to higher lease and common area maintenance expense in a growing portfolio of recently completed development sites.
Previous wording
Total provision for impairment increased by approximately $115.4 million compared to the same period in 2022 primarily due to the decline in fair value of our equity investment in DCRU, which was considered other than temporary due to the length of time and extent to which the fair value of our investment has been less than the carrying value. As a result, we recorded an impairment charge of $95 million during the three months ended September 30, 2023.
Current wording
During the year ended December 31, 2023, we recognized impairment charges of approximately $118.4 million, primarily due to the decline in fair value of our equity investment in DCRU, which was considered other than temporary due to the length of time and extent to which the fair value of our investment has been less than the carrying value.
Previous wording
In July 2023, we received approximately $0.7 billion of gross proceeds from the contribution of our data centers to the joint venture with GI Partners for a net gain on sale of approximately $238 million and we received approximately $1.4 billion of gross proceeds from the contribution of our data centers to the joint venture with TPG Real Estate for a net gain on sale of approximately $576 million.
Current wording
In May 2023, we disposed of a non-core asset, resulting in a net gain on sale of $87 million. In July 2023, we received approximately $0.7 billion of gross proceeds from the contribution of our data centers to the joint venture with GI Partners for a net gain on sale of approximately $238 million and we received approximately $1.4 billion of gross proceeds from the contribution of our data centers to the joint venture with TPG Real Estate for a net gain on sale of approximately $576 million.
Previous wording
We had no extinguishment of debt in 2023. In February 2022, we redeemed the 4.750% Notes due 2025, which resulted in a $51.1 million loss.
Current wording
We had no extinguishment of debt in 2023.
Previous wording
Interest expense increased approximately $138.6 million compared to the same period in 2022 driven primarily by:
Current wording
Interest expense increased approximately $15.1 million compared to the same period in 2023 driven primarily by increased borrowings at Teraco.
Previous wording
Income tax expense increased by approximately $44.0 million as compared to the same period in 2022 due to increased profitability, jurisdictional rate mix in foreign jurisdictions, and reduced benefit included in 2022 reported income tax expense associated with valuation allowance releases.
Current wording
Income tax expense decreased by approximately $20.8 million as compared to the same period in 2023 due to jurisdictional rate mix in foreign jurisdictions and internal restructurings within the global group.
Previous wording
Our Parent and our Operating Partnership were parties to an at-the-market (ATM) Equity Offering SM Sales Agreement dated April 1, 2022, as amended in 2023 (the "2022 Sales Agreement"). Pursuant to the 2022 Sales Agreement, Digital Realty Trust, Inc. could issue and sell common stock having an aggregate offering price of up to $1.5 billion through various named agents from time to time. For the year ended December 31, 2023, our Parent generated net proceeds of approximately $1.1 billion from the issuance of approximately 11.3 million common shares under the 2022 Sales Agreement at an average price of $96.35 per share after payment of approximately $7.5 million of commissions to the agents. The 2022 Sales Agreement was terminated on August 4, 2023, and our Parent and our Operating Partnership entered into a new ATM Equity Offering SM Sales Agreement dated August 4, 2023 (the “2023 Sales Agreement”). At the time of the termination, $408.7 million remained unsold under the 2022 Sales Agreement. For the year ended December 31, 2022, we had no sales under the 2022 Sales Agreement. The proceeds from the issuances under the 2022 Sales Agreement for the year ended December 31, 2023 were contributed to our Operating Partnership in exchange for the issuance of approximately 11.3 million common units to our Parent Company.
Current wording
Digital Realty Trust, Inc. and Digital Realty Trust, L.P. were parties to an ATM Equity Offering SM Sales Agreement dated August 4, 2023 (the “2023 Sales Agreement”). Pursuant to the 2023 Sales Agreement, Digital Realty Trust, Inc. could issue and sell common stock having an aggregate offering price of up to $1.5 billion through various named agents from time to time. From January 1, 2024 through February 23, 2024, Digital Realty Trust, Inc. generated net proceeds of approximately $99 million from the issuance of approximately 0.6 million common shares under the 2023 Sales Agreement at an average price of $133.43 per share after payment of approximately $0.6 million of commissions to the agents. The proceeds from the issuances under the 2023 Sales Agreement for the year ended December 31, 2024, were contributed to our Operating Partnership in exchange for the issuance of approximately 0.6 million common units to our Parent Company.
Previous wording
The expected tax treatment of distributions on our Parent’s common stock and preferred stock paid in 2023 is as follows: approximately 40% ordinary income and 60% as capital gain distribution. The tax treatment of distributions on our Parent’s common stock and preferred stock paid in 2022 was as follows: approximately 59% ordinary income, 16% as capital gain distribution, and 25% as nondividend distribution. The tax treatment of distributions on our Parent’s common stock paid in 2021 was as follows: approximately 9% ordinary income and 91% capital gain distribution.
Current wording
The expected tax treatment of distributions on our Parent’s common stock and preferred stock paid in 2024 is as follows: approximately 77% ordinary income and 23% as capital gain distribution. The tax treatment of distributions on our Parent’s common stock and preferred stock paid in 2023 was as follows: approximately 40% ordinary income and 60% as capital gain distribution. The tax treatment of distributions on our Parent’s common stock paid in 2022 was as follows: approximately 59% ordinary income, 16% as capital gain distribution, and 25% as nondividend distribution.
Previous wording
As of December 31, 2023, we had $1,625.5 million of cash and cash equivalents, excluding $11.0 million of restricted cash. Restricted cash primarily consists of contractual capital expenditures plus other deposits and is included in Other assets on our Consolidated Balance Sheets. As circumstances warrant, our Operating Partnership may dispose of stabilized assets or enter into joint venture arrangements with institutional investors or strategic partners, on an opportunistic basis dependent upon market conditions. Our Operating Partnership may use the proceeds from such dispositions to acquire additional properties, to fund development opportunities and for general working capital purposes, including the repayment of indebtedness. Our liquidity requirements primarily consist of:
Current wording
As of December 31, 2024, we had $3,870.9 million of cash and cash equivalents, excluding $5.8 million of restricted cash. Restricted cash primarily consists of contractual capital expenditures plus other deposits and is included in Other assets on our Consolidated Balance Sheets. As circumstances warrant, our Operating Partnership may dispose of stabilized assets or enter into joint venture arrangements with institutional investors or strategic partners, on an opportunistic basis dependent upon market conditions. Our Operating Partnership may use the proceeds from such dispositions to acquire additional properties, to fund development opportunities and for general working capital purposes, including the repayment of indebtedness. Our liquidity requirements primarily consist of:
Previous wording
On November 18, 2021, we refinanced our Global Revolving Credit Facility and Yen Revolving Credit Facility. On April 5, 2022, the Operating Partnership entered into an amendment of the Global Revolving Credit Facility which, among other things, increased the size of the Global Revolving Credit Facility from $3.0 billion to $3.75 billion. The Global Revolving Credit Facilities provide for borrowings of up to $3.9 billion (including approximately $0.2 billion available to be drawn on the Yen Revolving Credit Facility) based on currency commitments and foreign exchange rates as of December 31, 2023. The Global Revolving Credit Facility provides for borrowings in a variety of currencies and can be increased by an additional $750 million, subject to receipt of lender commitments and other conditions precedent. Both facilities mature on January 24, 2026, with two six-month extension options available.
Current wording
On September 24, 2024, we refinanced our Global Revolving Credit Facility and Yen Revolving Credit Facility. The Global Revolving Credit Facilities provide for borrowings up to $4.4 billion (including approximately $0.3 billion available to be drawn on the Yen Revolving Credit Facility) based on currency commitments and foreign exchange rates as of December 31, 2024. The Global Revolving Credit Facility provides for borrowings in a variety of currencies and can be increased by an additional $1.8 billion, subject to receipt of lender commitments and other conditions precedent. Both facilities mature on January 24, 2029, with two six-month extension options available.
Previous wording
Our properties require periodic investments of capital for customer-related capital expenditures and for general capital improvements. Depending upon customer demand, we expect to incur significant improvement costs to build out and develop additional capacity. At December 31, 2023, we had open commitments, related to construction contracts of approximately $2.2 billion, including amounts reimbursable of approximately $78.3 million.
Current wording
Our properties require periodic investments of capital for customer-related capital expenditures and for general capital improvements. Depending upon customer demand, we expect to incur significant improvement costs to build out and develop additional capacity. At December 31, 2024, we had open commitments, related to construction contracts of approximately $2.0 billion, including amounts reimbursable of approximately $102.5 million.
Previous wording
We currently expect to incur approximately $2.0 billion to $2.5 billion of capital expenditures, net of partner contributions for our development programs, during the year ending December 31, 2024. This amount could go up or down, potentially materially, based on numerous factors, including changes in demand, leasing results and availability of debt or equity capital.
Current wording
During the year ending December 31, 2025, we expect to incur approximately $3.0 billion to $3.5 billion of capital expenditures, which includes our share of joint venture contributions and is net of partner contributions for our development programs. This amount could go up or down, potentially materially, based on numerous factors, including changes in demand, leasing results and availability of debt or equity capital.
Previous wording
Land inventory and space held for development reflect cumulative cost spent pending future development. Base building construction consists of ongoing improvements to building infrastructure in preparation for future data center fit-out. Data center construction includes 7.6 million square feet of Turn Key Flex®and Powered Base Building® product. Generally, we expect to deliver the space within 12 months; however, lease commencement dates may significantly impact final delivery schedules. Equipment pool and other inventory represent the value of long-lead equipment and materials required for timely deployment and delivery of data center construction fit-out. Campus, tenant improvements and other costs include the value of development work which benefits space recently converted to our operating portfolio and is composed primarily of shared infrastructure projects and first-generation tenant improvements.
Current wording
Future development reflects cumulative cost spent pending future development and includes ongoing improvements to building infrastructure in preparation for future data center fit-out. We expect to deliver the space within 12 months; however, lease commencement dates may significantly impact final delivery schedules.
Previous wording
For the year ended December 31, 2023, total capital expenditures increased $0.8 billion to approximately $3.3 billion from $2.5 billion for the same period in 2022. Capital expenditures on our development projects plus our enhancement and improvements projects for the year ended December 31, 2023 were approximately $3.0 billion, which reflects an increase of approximately 34% from the same period in 2022. Our development capital expenditures are generally funded by our available cash and equity and debt capital.
Current wording
For the year ended December 31, 2024, total capital expenditures decreased approximately $0.7 billion as compared to the same period in 2023. Capital expenditures on our development projects plus our enhancement and improvements projects for the year ended December 31, 2024 were approximately $2.3 billion, which reflects a decrease of approximately 23% from the same period in 2023. Our development capital expenditures are generally funded by our available cash and equity and debt capital.
Previous wording
Indirect costs, including interest, capitalized in the years ended December 31, 2023 and 2022 were $216.0 million and $156.9 million, respectively. Capitalized interest comprised approximately $116.8 million and $70.8 million of the total indirect costs capitalized for the years ended December 31, 2023 and 2022, respectively. Capitalized interest in the year ended December 31, 2023 increased, compared to the same period in 2022, due to an increase in qualifying activities and higher interest rates.
Current wording
Indirect costs, including interest, capitalized in the years ended December 31, 2024 and 2023 were $230.1 million and $216.0 million, respectively. Capitalized interest comprised approximately $118.9 million and $116.8 million of the total indirect costs capitalized for the years ended December 31, 2024 and 2023, respectively. Capitalized interest in the year ended December 31, 2024 increased compared to the same period in 2023 due to an increase in qualifying activities and higher interest rates.
Previous wording
We expect to meet our short-term and long-term liquidity requirements, including payment of scheduled debt maturities and funding of acquisitions and non-recurring capital improvements, with net cash from operations, future long-term secured and unsecured indebtedness and the issuance of equity and debt securities and the proceeds of equity issuances by our Parent. We also may fund future short-term and long-term liquidity requirements, including acquisitions and non-recurring capital improvements, using our Global Revolving Credit Facilities pending permanent financing. As of February 21, 2024, we had approximately $2.0 billion of borrowings available under our Global Revolving Credit Facilities.
Current wording
We expect to meet our short-term and long-term liquidity requirements, including payment of scheduled debt maturities and funding of acquisitions and non-recurring capital improvements, with net cash from operations, future long-term secured and unsecured indebtedness and the issuance of equity and debt securities and the proceeds of equity issuances by our Parent. We also may fund future short-term and long-term liquidity requirements, including acquisitions and non-recurring capital improvements, using our Global Revolving Credit Facilities pending permanent financing. As of February 18, 2025, we had approximately $3.4 billion of borrowings available under our Global Revolving Credit Facilities.
Previous wording
Our Global Revolving Credit Facilities provides for borrowings up to $3.9 billion (including approximately $0.2 billion available to be drawn on the Yen Revolving Credit Facility). We have the ability from time to time to increase the size of the Global Revolving Credit Facility by up to $750 million, subject to the receipt of lender commitments and other conditions precedent. Both facilities mature on January 24, 2026, with two six-month extension options available; provided that the Operating Partnership must pay a 0.0625% extension fee based on each lender's revolving commitments then outstanding (whether funded or unfunded). These facilities also feature a sustainability-linked pricing component, with pricing subject to adjustment based on annual performance targets, further demonstrating our continued leadership and commitment to sustainable business practices. We have used and intend to use available borrowings under the Global Revolving Credit Facilities to fund our liquidity requirements from time to time. For additional information regarding our Global Revolving Credit Facility, see Note 11. “Debt of the Operating Partnership” to Consolidated Financial Statements contained herein.
Current wording
Our Global Revolving Credit Facilities provides for borrowings up to $4.4 billion (including approximately $0.3 billion available to be drawn on the Yen Revolving Credit Facility). We have the ability from time to time to increase the size of the Global Revolving Credit Facility by up to $1.8 billion, subject to the receipt of lender commitments and other conditions precedent. Both facilities mature on January 24, 2029, with two six-month extension options available. These facilities also feature a sustainability-linked pricing component, with pricing subject to adjustment based on annual performance targets, further demonstrating our continued leadership and commitment to sustainable business practices. We have used and intend to use available borrowings under the Global Revolving Credit Facilities to fund our liquidity requirements from time to time. For additional information regarding our Global Revolving Credit Facility, see Note 11. “Debt of the Operating Partnership” to Consolidated Financial Statements contained herein.
Previous wording
The Euro Term Loan Facilities provide (i) a €375,000,000 three-year senior unsecured term loan facility and (ii) a €375,000,000 five-year senior unsecured term loan facility, comprised of €125,000,000 of initial term loans, and €250,000,000 of delayed draw term loan commitments that were funded on September 9, 2023. The Euro Term Loan Facilities provide for borrowings in Euros. The 2025 Term Facility matures on August 11, 2025. The 2025-27 Term Facility matures on August 11, 2025, subject to two maturity extension options of one year each; provided that the Operating Partnership must pay a 0.125% extension fee based on the then-outstanding principal amount of the 2025-27 Term Facility commitments then outstanding. For additional information regarding our Euro Term Loan Facilities and the defined terms used above, see Note 11. “Debt of the Operating Partnership” to Consolidated Financial Statements contained herein.
Current wording
In addition, the 2025-27 Term Facility provides for a €375,000,000 five-year senior unsecured term loan facility, comprised of €125,000,000 of initial term loans, and €250,000,000 of delayed draw term loan commitments that were funded on September 9, 2023. Such facility provides for borrowings in Euros. The 2025-27 Term Facility matures on August 11, 2025, subject to two maturity extension options of one year each; provided that the Operating Partnership must pay a 0.125% extension fee based on the then-outstanding principal amount of the 2025-27 Term Facility commitments then outstanding. For additional information regarding the 2025-27 Term Facility and the defined terms used above, see Note 11. “Debt of the Operating Partnership” to Consolidated Financial Statements contained herein.
Previous wording
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. 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.
Current wording
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 retained a 35% interest in the joint venture. As a result of transferring control, we derecognized the data centers. In addition, GI Partners had 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, pursuant to the exercise of such call option, in the amount of $68 million, resulting in such 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.
Previous wording
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.
Current wording
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 contributed such cash in exchange for a 65% interest in the joint venture. Each partner funded its pro rata share of the remaining $140 million estimated development cost for the first phase of the project, of which one project has been completed in June 2024 and another has been completed in October 2024.
Previous wording
Our ratio of debt to total enterprise value was approximately 29% (based on the closing price of Digital Realty Trust, Inc.’s common stock on December 31, 2023 of $134.58). For this purpose, our total enterprise value is defined as the sum of the market value of Digital Realty Trust, Inc.’s outstanding common stock (which may decrease, thereby increasing our debt to total enterprise value ratio), plus the liquidation value of Digital Realty Trust, Inc.’s preferred stock, plus the aggregate value of our Operating Partnership’s units not held by Digital Realty Trust, Inc. (with the per unit value equal to the market value of one share of Digital Realty Trust, Inc.’s common stock and excluding long-term incentive units, Class C units and Class D units), plus the book value of our total consolidated indebtedness.
Current wording
Our ratio of debt to total enterprise value was approximately 21.4% (based on the closing price of Digital Realty Trust, Inc.’s common stock on December 31, 2024 of $177.33). For this purpose, our total enterprise value is defined as the sum of the market value of Digital Realty Trust, Inc.’s outstanding common stock (which may decrease, thereby increasing our debt to total enterprise value ratio), plus the liquidation value of Digital Realty Trust, Inc.’s preferred stock, plus the aggregate value of our Operating Partnership’s units not held by Digital Realty Trust, Inc. (with the per unit value equal to the market value of one share of Digital Realty Trust, Inc.’s common stock and excluding long-term incentive units, Class C units and Class D units), plus the book value of our total consolidated indebtedness.
Previous wording
The variable rate debt shown above bears interest based on various one-month SOFR, EURIBOR, SORA, BBR, HIBOR, TIBOR, Base CD Rate, CDOR and JIBAR rates, depending on the respective agreement governing the debt, including our Global Revolving Credit Facilities, unsecured term loans, Teraco loans and ICN10 Facilities. As of December 31, 2023, our debt had a weighted average term to initial maturity of approximately 4.1 years (or approximately 4.3 years assuming exercise of extension options).
Current wording
The variable rate debt shown above bears interest based on various one-month SOFR, EURIBOR, HIBOR, TIBOR, Base CD Rate, CDOR and JIBAR rates, depending on the respective agreement governing the debt, including our Global Revolving Credit Facilities, unsecured term loans, Teraco loans and ICN10 Facilities. As of December 31, 2023, our debt had a weighted average term to initial maturity of approximately 4.2 years (or approximately 4.4 years assuming exercise of extension options).
Previous wording
As of December 31, 2023, our pro-rata share of secured debt of unconsolidated entities was approximately $1.5 billion.
Current wording
As of December 31, 2024, our pro-rata share of secured debt of unconsolidated entities was approximately $1.4 billion.
Previous wording
The decrease in net cash used in investing activities as compared to the same period in 2022 was primarily due to:
Current wording
The increase in net cash used in investing activities as compared to the same period in 2023 was primarily due to:
Previous wording
The decrease in net cash provided by financing activities as compared to the same period in 2022 was primarily due to:
Current wording
The increase in net cash provided by financing activities as compared to the same period in 2023 was primarily due to:
Previous wording
Noncontrolling interests relate to the common units in our Operating Partnership that are not owned by Digital Realty Trust, Inc., which, as of December 31, 2023, amounted to 2.0% of our Operating Partnership common units. Historically, our Operating Partnership has issued common units to third party sellers in connection with our acquisition of real estate interests from such third parties.
Current wording
Noncontrolling interests relate to the common units in our Operating Partnership that are not owned by Digital Realty Trust, Inc., which, as of December 31, 2024, amounted to 1.8% of our Operating Partnership common units. Historically, our Operating Partnership has issued common units to third party sellers in connection with our acquisition of real estate interests from such third parties.
Previous wording
A critical accounting policy is one that involves management’s use of judgement regarding expected outcomes of uncertain events in order to make estimates and assumptions that are material to an entity’s financial condition and results of operations. Though we base our estimates and assumptions regarding these matters on historical and current conditions as well as future expectations, these estimates and assumptions are subjective in nature. Changes to the estimates and assumptions we make regarding these matters could affect our financial position and specific items in our results of operations used by stockholders, potential investors, industry analysts and lenders in the evaluation of our performance. Of the significant accounting policies described in Note 2 to the Consolidated Financial Statements, the subsequent items have been identified by us as meeting the criteria to be considered critical accounting policies. Refer to Note 2 for more information on these critical accounting policies.
Current wording
A critical accounting policy is one that involves management’s use of judgement regarding expected outcomes of uncertain events in order to make estimates and assumptions that are material to an entity’s financial condition and results of operations. Though we base our estimates and assumptions regarding these matters on historical and current conditions as well as future expectations, these estimates and assumptions are subjective in nature. Changes to the estimates and assumptions we make regarding these matters could affect our financial position and specific items in our
Previous wording
We calculate funds from operations, or FFO, in accordance with the standards established by the National Association of Real Estate Investment Trusts (Nareit) in the Nareit Funds From Operations White Paper - 2018 Restatement. FFO is a non-GAAP financial measure and represents net income (loss) (computed in accordance with GAAP), excluding gain (loss) from the disposition of real estate assets, provision for impairment, real estate related depreciation and amortization (excluding amortization of deferred financing costs), our share of unconsolidated JV real estate related depreciation & amortization, net income attributable to non-controlling interests in operating partnership and, depreciation related to non-controlling interests. Management uses FFO as a supplemental performance measure because, in excluding real estate related depreciation and amortization and gains and losses from property dispositions and after adjustments for unconsolidated partnerships and joint ventures, 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 data centers 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 data centers, 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 other REITs’ FFO. FFO should be considered only as a supplement to net income computed in accordance with GAAP as a measure of our performance.
Current wording
We calculate funds from operations, or FFO, in accordance with the standards established by the National Association of Real Estate Investment Trusts (Nareit) in the Nareit Funds From Operations White Paper - 2018 Restatement. FFO is a non-GAAP financial measure and represents net income (loss) (computed in accordance with GAAP), excluding gain (loss) from the disposition of real estate assets, provision for impairment, real estate related depreciation and amortization (excluding amortization of deferred financing costs), our share of unconsolidated JV real estate related depreciation & amortization, net income attributable to noncontrolling interests in operating partnership and, reconciling items related to noncontrolling interests. Management uses FFO as a supplemental performance measure because, in excluding real estate related depreciation and amortization and gains and losses from property dispositions and after adjustments for unconsolidated partnerships and joint ventures, 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 data centers 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 data centers, 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 other REITs’ FFO. FFO should be considered only as a supplement to net income computed in accordance with GAAP as a measure of our performance.
Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
Total stabilized rental property operating and maintenance expenses (excluding utilities) increased by approximately $50.9 million compared to the same period in 2023 primarily due to an increase in data center labor and common area maintenance expense.
Current report — wording carried from elsewhere
We also granted GI Partners an option to purchase an interest in the third facility on the same hyperscale data center campus in Chicago. On April 16, 2024, we expanded our existing joint venture with GI Partners with the sale to GI Partners of a 75% interest in a third facility. 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.
Current report — wording carried from elsewhere
results of operations used by stockholders, potential investors, industry analysts and lenders in the evaluation of our performance. Of the significant accounting policies described in Note 2 to the Consolidated Financial Statements, the subsequent items have been identified by us as meeting the criteria to be considered critical accounting policies. Refer to Note 2 for more information on these critical accounting policies.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
In May 2023, we disposed of a non-core asset, resulting in a net gain on sale of $87 million.