Summary
Digital Realty Trust, Inc. (DLR) has filed an 8-K detailing significant strategic transactions, primarily focused on expanding its data center footprint. The most notable event is the agreement to acquire Blackstone's entire 64% interest in the Digital Carver Dulles 9 and Digital Carver Brickyard joint ventures for a combination of $1,231 million in cash and newly issued non-voting common stock valued at approximately $2,346 million. This acquisition will result in DLR wholly owning three hyperscale data centers in Northern Virginia, totaling 288 megawatts of capacity, which are fully leased to investment-grade tenants with long-term leases and rent escalators. The company anticipates this transaction to be leverage-neutral and accretive to Core FFO per share in 2027 and 2028. In addition to the Blackstone deal, DLR also reported the acquisition of approximately 1,440 acres near Kansas City for future development, securing significant power commitments. Furthermore, DLR is increasing its stake in the Teraco joint venture to 77% by acquiring an additional 16% interest using shares of its common stock. The company also disclosed activity under its "at the market" equity program, selling over 6 million shares for approximately $1.2 billion to fund various corporate purposes. These transactions underscore DLR's proactive strategy to enhance its portfolio with high-quality, leased development assets in key markets while managing its capital structure.
Key Highlights
- 1Agreement to acquire Blackstone's 64% interest in Digital Carver Dulles 9 and Digital Carver Brickyard joint ventures for $1.231 billion cash and approximately $2.346 billion in non-voting common stock.
- 2Acquisition will result in wholly-owned ownership of three hyperscale data centers in Northern Virginia with 288 MW of capacity, fully leased to investment-grade tenants.
- 3The acquired data centers are expected to stabilize in 2027 and 2028 and are supported by 15-year leases with 3.6% annual rent escalators.
- 4Transaction is expected to be leverage-neutral and accretive to Core FFO per share in 2027 and 2028.
- 5Acquisition of approximately 1,440 acres for future development near Kansas City, with substantial power commitments secured.
- 6Increased ownership in Teraco joint venture to 77% by acquiring an additional 16% interest through stock issuance.
- 7Sold 6,158,839 shares of common stock under an At-the-Market program, raising approximately $1.2 billion in net proceeds.