8-KMaterial AgreementsFinancial EventsOther Events+1

DIGITAL REALTY TRUST, INC. 8-K Report, Material Agreement (Jun 21, 2018)

Filed June 21, 2018For Securities:DLRDLR-PJDLR-PKDLR-PL

Summary

This 8-K filing from Digital Realty Trust, Inc. (DLR) on June 21, 2018, primarily announces the successful completion of an underwritten public offering of $650 million in aggregate principal amount of 4.450% Notes due 2028 by its operating partnership, Digital Realty Trust, L.P. These unsecured senior notes are fully and unconditionally guaranteed by the parent company, Digital Realty Trust, Inc. The offering was made under an existing shelf registration statement. The proceeds from this issuance will provide additional capital for the company, which is crucial for its ongoing development, acquisition, and operational strategies in the data center real estate sector. Investors should note the terms of the notes, including their interest rate, maturity date, subordination to secured debt, and the conditions for redemption and events of default, which are detailed in the accompanying indentures.

Key Highlights

  • 1Digital Realty Trust, L.P. successfully issued $650 million in aggregate principal amount of 4.450% Senior Notes due 2028.
  • 2The new notes are unsecured general senior obligations of Digital Realty Trust, L.P.
  • 3Digital Realty Trust, Inc. provides a full and unconditional guarantee for the notes.
  • 4The notes bear an annual interest rate of 4.450%, payable semi-annually.
  • 5Maturity date for the notes is July 15, 2028.
  • 6The notes are effectively subordinated to any existing or future secured indebtedness.
  • 7The offering was completed under an effective shelf registration statement filed in September 2017.

Frequently Asked Questions

The primary purpose of this filing was to report the completion of a material definitive agreement, specifically the underwritten public offering of $650 million aggregate principal amount of 4.450% Notes due 2028 by Digital Realty Trust, L.P., which is guaranteed by Digital Realty Trust, Inc.

The notes have a principal amount of $650 million, bear a fixed interest rate of 4.450% per annum, payable semi-annually on January 15 and July 15, with the first payment on January 15, 2019. They mature on July 15, 2028. The notes are unsecured senior obligations of Digital Realty Trust, L.P., guaranteed by Digital Realty Trust, Inc., but are subordinated to secured debt.

The notes can be redeemed in whole or in part at the issuer's option at any time up to, but not including, April 15, 2028. The redemption price includes 100% of the principal amount plus accrued interest and a 'make-whole' premium. If redeemed on or after April 15, 2028, the redemption price is 100% of the principal amount plus accrued interest.

The full and unconditional guarantee from Digital Realty Trust, Inc. provides an additional layer of credit support for the noteholders. However, investors should be aware that these notes are effectively subordinated to any secured indebtedness of Digital Realty Trust, L.P., meaning secured creditors would be paid before noteholders in the event of a liquidation or bankruptcy.