Digital Realty Trust Reports Leasing Activity for the Fourth Quarter and Full Year 2009

SAN FRANCISCO, Feb. 10 /PRNewswire-FirstCall/ -- Digital Realty Trust, Inc. (NYSE: DLR), a leading owner and manager of corporate and Internet gateway datacenters, announced today the results of its leasing activity for both the fourth quarter and full year 2009. For the full year 2009, lease signings represent over $472 million in total cash contract value.  

"We are very pleased with our leasing results for both the fourth quarter and full year 2009, particularly in light of last year's challenging economic conditions," commented Michael F. Foust, CEO of Digital Realty Trust.  "The measured approach we took over the year of aligning our redevelopment activity with real demand for our products, particularly Turn-Key Datacenter space, allowed us to manage our capital allocation and meet our return on investment objectives.  This disciplined approach to our investment strategy, combined with our scale and ability to drive down development costs,  has resulted in an expected average return on invested capital for our Turn-Key space of over 14% for the year." Average return on invested capital is defined at the end of this press release.

For the year ended December 31, 2009, the Company commenced leases totaling approximately 757,000 square feet. This includes over 369,000 square feet of Turn-Key Datacenter® space leased at an average annual GAAP rental rate of $177.00 per square foot, approximately 194,000 square feet of Powered Base Building® space leased at an average annual GAAP rental rate of $59.00 per square foot, and approximately 194,000 square feet of non-technical space leased at an average annual GAAP rental rate of $17.00 per square foot.

For the quarter ended December 31, 2009, the Company commenced leases totaling approximately 91,000 square feet of space. This includes nearly 53,000 square feet of Turn-Key Datacenter® space leased at an average annual GAAP rental rate of $173.00 per square foot, approximately 20,000 square feet of Powered Base Building® space leased at an average annual GAAP rental rate of $29.00 per square foot, and approximately 18,000 square feet of non-technical space leased at an average annual GAAP rental rate of $22.00 per square foot.

For the year ended December 31, 2009, the Company signed leases totaling approximately 434,000 square feet. This includes approximately 332,000 square feet of Turn-Key Datacenter® space leased at an average annual GAAP rental rate of $158.00 per square foot, over 35,000 square feet of Powered Base Building® space leased at an average annual GAAP rental rate of $27.00 per square foot, and approximately 67,000 square feet of non-technical space leased at an average annual GAAP rental rate of $22.00 per square foot.  

For the quarter ended December 31, 2009, the Company signed leases totaling approximately 156,000 square feet of space. This includes approximately 116,000 square feet of Turn-Key Datacenter space leased at an average annual GAAP rental rate of $126.00 per square foot, approximately 30,000 square feet of Powered Base Building space leased at an average annual GAAP rental rate of $26.00 per square foot, and approximately 10,000 square feet of non-technical space leased at an average annual GAAP rental rate of $31.00 per square foot.

The leasing results include all activity at the Company's consolidated joint venture property.

For the year ended December 31, 2009, the Company signed lease renewals totaling approximately 1.3 million square feet, resulting in a 22.5% increase in GAAP rent for the leases renewed.

"The high level of leases renewed during the year reflects the mission critical nature of our customers' operations in our facilities.  We also added a number of new, large corporate enterprise customers along with leading IT service providers and global system integrators to our roster, demonstrating the widespread adoption of our Turn-Key Datacenter® product," Mr. Foust added.  "In addition to our acquisitions activity, our ability to meet the demand for datacenter space through our redevelopment program continues to be an important source of growth for the Company."

Digital Realty Trust Turn-Key Datacenter facilities provide state-of-the-art environments for supporting mission critical infrastructure, with advanced cooling, power, redundancy, and sustainability features to ensure that critical applications are available while optimizing energy efficiency. Digital Realty Trust's Turn-Key Datacenters are scalable from hundreds of kilowatts of IT Load to megawatts of IT load and are located in markets throughout North America and Europe. Each Turn-Key Datacenter facility is physically secure and features a state-of-the-art power and cooling architecture that has been optimized for green operation. Every Turn-Key Datacenter is built using the company's proprietary POD Architecture® and uses metered power to ensure that clients pay only for the power that they use.

Average Return on Invested Capital

Average return on invested capital for Turn-Key space is calculated by dividing the expected annualized net operating income generated by each Turn-Key lease by the sum of the allocated acquisition costs, construction costs, tenant improvements and leasing commissions incurred in connection with each Turn-Key lease.  The net operating income is calculated by subtracting the estimated annualized, first-year stabilized recurring expenses with respect to each Turn-Key lease from the anticipated first-year stabilized cash rental revenue generated by each lease. Turn-Key leases generating less than $500,000 per year in annualized rent were excluded from the calculation.

About Digital Realty Trust, Inc.

Digital Realty Trust, Inc. owns, acquires, redevelops, develops and manages technology-related real estate. The Company is focused on providing Turn-Key Datacenter® and Powered Base Building® datacenter solutions for domestic and international tenants across a variety of industry verticals ranging from information technology and Internet enterprises, to manufacturing and financial services. Digital Realty Trust's 84 properties, excluding one property held as an investment in an unconsolidated joint venture, contain applications and operations critical to the day-to-day operations of technology industry tenants and corporate enterprise datacenter tenants. Comprising approximately 14.9 million rentable square feet as of January 25, 2010, including 1.9 million square feet of space held for redevelopment, Digital Realty Trust's portfolio is located in 27 markets throughout North America and Europe. For additional information, please visit Digital Realty Trust's website at http://www.digitalrealtytrust.com.

Turn-Key Datacenter, Powered Base Building and POD Architecture are registered trademarks of Digital Realty Trust.

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 company's average return on invested capital and expected net operating income generated by leases, which are based on forward-looking assumptions with respect to income and expenses. These risks and uncertainties include adverse economic or real estate developments in the Company's markets; general economic slow-downs or recessions; reductions in information technology spending; difficulties in or inability to lease space, including redeveloped space; construction and development delays; increased development costs; tenant bankruptcies or defaults under leases by tenants; failure to commence rental payments on time under signed leases; increased interest rates; increased operating costs; failure to obtain necessary outside financing; decreased rental rates or increased vacancy rates; difficulties in identifying properties to acquire; completing acquisitions at all or at acceptable return levels; failure to successfully operate properties; failure of existing, acquired or redeveloped properties to perform as expected; reductions in property values; failure to maintain the Company's status as a REIT; environmental uncertainties and risks related to natural disasters; financial market fluctuations; changes in foreign currency exchange rates; risks of operating in foreign markets; and changes in real estate and zoning laws and increases in real property tax rates.  For a further list and description of such risks and uncertainties, see the reports and other filings by the Company with the United States Securities and Exchange Commission, including the Company's annual report on Form 10-K for the year ended December 31, 2008 and the Company's quarterly reports on Form 10-Q for the quarters ended March 31, 2009, June 30, 2009 and September 30, 2009.  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.

SOURCE Digital Realty Trust, Inc.