Digital Realty Announces Joint Venture of Stabilized Hyperscale Data Centers in Chicago

AUSTIN, Texas, July 17, 2023  /PRNewswire/ -- Digital Realty (NYSE: DLR), the largest global provider of cloud- and carrier-neutral data center, colocation and interconnection solutions, announced today it has partnered with GI Partners to establish a joint venture for the sale of a 65% interest in two stabilized hyperscale data center buildings and their associated equipment in the Chicago metro area.  Digital Realty will receive approximately $743 million of gross proceeds related to the joint venture and the associated financing, and will maintain a 35% interest in the joint venture while continuing to manage the day-to-day operations of the assets, providing a seamless customer experience.  Digital Realty has also granted GI Partners an option to purchase an interest in the third facility on the same hyperscale data center campus. 

"With Digital Realty's unmatched global footprint and the attractive fundamental outlook for the data center sector, we are pleased with the strong institutional demand for our high-quality facilities," said Digital Realty Chief Investment Officer Greg Wright.  "This transaction further diversifies Digital Realty's sources of capital and enhances our capital efficiency, in support of our strategic priorities.  We are pleased to partner with a data center investor of GI Partners' caliber on this initial joint venture and we look forward to the continued execution on our capital plan for 2023."

Digital Realty originally acquired the facilities in 2017 through its merger with DuPont Fabros.  The two data centers contributed to the joint venture contain approximately 67 megawatts of IT capacity and are 90% occupied in aggregate, primarily by investment grade customers. 

Based on annualized in-place cash NOI at June 30, 2023 and the benefit of leases signed but not yet commenced, the transaction values the two facilities at approximately a 6.5% cap rate.  Net proceeds will be used to pay down debt and for general corporate purposes.

About Digital Realty
Digital Realty brings companies and data together by delivering the full spectrum of data center, colocation and interconnection solutions.  PlatformDIGITAL®, the company's global data center platform, provides customers with a secure data "meeting place" and a proven Pervasive Datacenter Architecture (PDx®) solution methodology for powering innovation and efficiently managing Data Gravity challenges.  Digital Realty gives its customers access to the connected communities that matter to them with a global data center footprint of 300+ facilities in 50+ metros across 27 countries on six continents.  To learn more about Digital Realty, please visit digitalrealty.com or follow us on LinkedIn and Twitter.   

For Additional Information

Investor Relations
Jordan Sadler / Jim Huseby
Digital Realty
+1 737 281 0101
InvestorRelations@digitalrealty.com

Media Contacts
Helen Bleasdale
Digital Realty
+1 737 267 6822
hcbleasdale@digitalrealty.com

Safe Harbor Statement
This press release contains forward-looking statements which are based on current expectations, forecasts and assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially, including statements related to the disposition, expected benefits, use of proceeds and the company's strategy.  For a list and description of such risks and uncertainties, see the reports and other filings by the company with the U.S. Securities and Exchange Commission.  The company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. 

 

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SOURCE Digital Realty