Digital Realty Reports Third Quarter 2021 Results

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Oct 26, 2021, 16:05 ET

AUSTIN, Texas, Oct. 26, 2021 /PRNewswire/ -- Digital Realty (NYSE: DLR), the largest global provider of cloud- and carrier-neutral data center, colocation and interconnection solutions, announced today financial results for the third quarter of 2021. All per-share results are presented on a fully-diluted share and unit basis.

Highlights

Reported net income available to common stockholders of $0.44 per share in 3Q21, compared to a net loss available to common stockholders of ($0.14) in 3Q20
Reported FFO per share of $1.54 in 3Q21, compared to $1.19 in 3Q20
Reported core FFO per share of $1.65 in 3Q21, compared to $1.54 in 3Q20
Signed total bookings during 3Q21 expected to generate $113 million of annualized GAAP rental revenue, including a $12 million contribution from interconnection
Raised core FFO per share outlook from $6.45-$6.50 to $6.50-$6.55

Financial Results

Digital Realty reported revenues for the third quarter of 2021 of $1.1 billion, a 4% increase from the previous quarter and an 11% increase from the same quarter last year.

The company delivered third quarter of 2021 net income of $137 million, and net income available to common stockholders of $124 million, or $0.44 per diluted share, compared to $0.45 per diluted share in the previous quarter and ($0.14) per diluted share in the same quarter last year.

Digital Realty generated third quarter of 2021 Adjusted EBITDA of $610 million, a 1% increase from the previous quarter and a 7% increase over the same quarter last year.

The company reported third quarter of 2021 funds from operations of $447 million, or $1.54 per share, compared to $1.78 per share in the previous quarter and $1.19 per share in the same quarter last year.

Excluding certain items that do not represent core expenses or revenue streams, Digital Realty delivered third quarter of 2021 core FFO per share of $1.65, a 7% increase from $1.54 per share in the previous quarter, and a 7% increase from $1.54 per share in the same quarter last year.

Leasing Activity

In the third quarter, Digital Realty signed total bookings expected to generate $113 million of annualized GAAP rental revenue, including a $12 million contribution from interconnection.

"Digital Realty's global platform, broad product spectrum, and significant scale underpinned our strong third quarter results," said Digital Realty Chief Executive Officer A. William Stein. "Record new logo growth and continued strong bookings in the quarter reflect the global adoption of PlatformDIGITAL®, while our robust internal processes enabled us to execute consistently for our growing list of customers."

The weighted-average lag between new leases signed during the third quarter of 2021 and the contractual commencement date was seven months.

In addition to new leases signed, Digital Realty also signed renewal leases representing $223 million of annualized GAAP rental revenue during the quarter. Rental rates on renewal leases signed during the third quarter of 2021 rolled down 5.6% on a cash basis and down 3.3% on a GAAP basis.

New leases signed during the third quarter of 2021 are summarized by region as follows:


	Annualized GAAP
	Base Rent			GAAP Base Rent			GAAP Base Rent
The Americas	(in thousands)		Square Feet	per Square Foot		Megawatts	per Kilowatt
0-1 MW		$11,685	59,887		$195	4.3		$226
> 1 MW		37,923	397,759		95	39.5		80
Other ⁽¹⁾		276	5,991		46	—		—
Total		$49,883	463,637		$108	43.8		$94

EMEA ⁽²⁾
0-1 MW		$15,225	68,285		$223	6.5		$196
> 1 MW		20,988	128,885		163	15.4		114
Other ⁽¹⁾		21	—		-	—		—
Total		$36,234	197,170		$184	21.9		$138

Asia Pacific ⁽²⁾
0-1 MW		$5,119	10,739		$477	1.4		$296
> 1 MW		9,850	53,946		183	6.0		137
Other ⁽¹⁾		123	1,484		83	—		—
Total		$15,092	66,168		$228	7.4		$168

All Regions ⁽²⁾
0-1 MW		$32,028	138,911		$231	12.2		$218
> 1 MW		68,761	580,589		118	60.9		94
Other ⁽¹⁾		420	7,475		56	—		—
Total		$101,209	726,975		$139	73.1		$115

Interconnection		$11,636	N/A		N/A	N/A		N/A

Grand Total		$112,845	726,975		$139	73.1		$115


Note: Totals may not foot due to rounding differences.
(1)	Other includes Powered Base Building® shell capacity as well as storage and office space within fully improved data center facilities.
(2)	Based on quarterly average exchange rates during the three months ended September 30, 2021.

Investment Activity

During the third quarter, the existing joint venture between Digital Realty and PGIM Real Estate, the real estate investment management and advisory business of Prudential Financial, completed the sale of a portfolio of 10 data centers in North America for $581 million, representing an exit cap rate of approximately 4.5% on the seven stabilized assets in the portfolio. PGIM Real Estate owned an 80% interest and Digital Realty owned a 20% interest in the joint venture. The transaction generated net proceeds of approximately $347 million, of which Digital Realty's share was approximately $85 million, including a $19 million promote fee.

Separately, Digital Realty closed on the sale of a 56-acre land parcel in Mesa, AZ during the third quarter for approximately $17 million.

Likewise during the third quarter, Digital Realty closed its previously announced joint venture with Brookfield Infrastructure Partners in India. The joint venture enables the expansion of PlatformDIGITAL®, Digital Realty's global data center platform, which supports the evolving data, control and networking demands of global service providers as well as global and local enterprises. Its expansion across India is expected to enable customers to rapidly scale digital transformation by deploying critical infrastructure with a leading global data center provider at the heart of a growing connected data community in India.

Subsequent to quarter-end, Digital Realty reached an agreement to make a strategic investment in AtlasEdge Data Centres, a leading European edge data center provider.

Also subsequent to quarter-end, Digital Realty and Pembani Remgro Infrastructure Fund created a new joint venture which acquired a controlling interest in Medallion Communications, Nigeria's leading colocation and interconnection provider, for approximately $29 million. In addition, Kenyan data center operator iColo, Digital Realty's existing joint venture with Pembani Remgro Infrastructure Fund, closed on the acquisition of a land parcel in Maputo, Mozambique during the third quarter for $3 million.

Balance Sheet

Digital Realty had approximately $14.1 billion of total debt outstanding as of September 30, 2021, comprised of $13.8 billion of unsecured debt and approximately $0.2 billion of secured debt. At the end of the third quarter of 2021, net debt-to-Adjusted EBITDA was 6.0x, debt plus-preferred-to-total enterprise value was 26.1% and fixed charge coverage was 5.8x. Pro forma for settlement of the $950 million forward equity offering completed in September, net debt-to-adjusted EBITDA was 5.6x and fixed charge coverage was 6.0x.

Digital Realty completed the following financing transactions during the third quarter.

In early July, Digital Realty closed an offering of CHF545 million, or approximately $595 million, of Swiss green bonds with a weighted-average maturity of approximately 6.6 years and a weighted-average coupon of approximately 0.37%.
In early July, Digital Realty liquidated its remaining stake in Megaport with the sale of 1.95 million shares at a price of A$17.55 per share, generating gross proceeds of A$34 million, or approximately $26 million.
In late August, Digital Realty issued approximately 0.6 million shares of common stock under the company's at-the-market equity offering program at a weighted average price of $162.20 per share, generating gross proceeds of approximately $95 million.
In early September, Digital Realty completed an offering of 6,250,000 shares of common stock at a price of $160.50 per share, subject to forward sale agreements. The company expects to receive net proceeds of approximately $950 million (net of fees and estimated expenses) upon full physical settlement of the forward sale agreements, expected to be no later than March 13, 2023.

2021 Outlook

Digital Realty raised its 2021 core FFO per share outlook from $6.45-$6.50 to $6.50-$6.55. The assumptions underlying the outlook are summarized in the following table.


	As of	As of	As of	As of
Top-Line and Cost Structure	February 11, 2021	April 29, 2021	July 29, 2021	October 26, 2021
Total revenue	$4.250 - $4.350 billion	$4.300 - $4.400 billion	$4.325 - $4.425 billion	$4.400 - $4.425 billion
Net non-cash rent adjustments (1)	($10) - ($15) million	($20) - ($25) million	($20) - ($25) million	($20) - ($25) million
Adjusted EBITDA	$2.300 - $2.350 billion	$2.330 - $2.380 billion	$2.350 - $2.400 billion	$2.400 - $2.425 billion
G&A	$365 - $375 million	$380 - $390 million	$380 - $390 million	$380 - $390 million

Internal Growth
Rental rates on renewal leases
Cash basis	Slightly negative	Slightly negative	Slightly negative	Slightly negative
GAAP basis	Slightly positive	Slightly positive	Slightly positive	Slightly positive
Year-end portfolio occupancy	84.0% - 85.0%	84.0% - 85.0%	84.0% - 85.0%	84.0% - 85.0%
"Same-capital" cash NOI growth (2)	(2.5%) - (3.5%)	(2.5%) - (3.5%)	(2.5%) - (3.5%)	(2.5%) - (3.5%)

Foreign Exchange Rates
U.S. Dollar / Pound Sterling	$1.25 - $1.30	$1.30 - $1.38	$1.30 - $1.38	$1.30 - $1.38
U.S. Dollar / Euro	$1.15 - $1.20	$1.15 - $1.20	$1.15 - $1.20	$1.15 - $1.20

External Growth
Dispositions
Dollar volume	$0.6 - $1.0 billion	$0.7 - $1.0 billion	$0.7 - $1.0 billion	$0.7 - $1.0 billion
Cap rate	0.0% - 12.0%	0.0% - 12.0%	0.0% - 12.0%	0.0% - 12.0%
Development
CapEx (3)	$2.0 - $2.3 billion	$2.0 - $2.3 billion	$2.0 - $2.3 billion	$2.0 - $2.3 billion
Average stabilized yields	9.0% - 15.0%	9.0% - 15.0%	9.0% - 15.0%	9.0% - 15.0%
Enhancements and other non-recurring CapEx (4)	$5 - $10 million	$5 - $10 million	$5 - $10 million	$5 - $10 million
Recurring CapEx + capitalized leasing costs (5)	$220 - $230 million	$220 - $230 million	$210 - $220 million	$190 - $200 million

Balance Sheet
Long-term debt issuance
Dollar amount	$1.0 - $1.5 billion	$1.0 - $1.5 billion	$1.8 - $2.0 billion	$1.8 - $2.0 billion
Pricing	1.00%	1.00%	1.00%	1.00%
Timing	Early-to-mid 2021	Early-to-mid 2021	Early-to-mid 2021	Early-to-mid 2021

Net income per diluted share	$1.40 - $1.45	$2.00 - $2.05	$2.20 - $2.25	$2.45 - $2.50
Real estate depreciation and (gain) / loss on sale	$4.90 - $4.90	$4.25 - $4.25	$4.15 - $4.15	$3.95 - $3.95
Funds From Operations / share (NAREIT-Defined)	$6.30 - $6.35	$6.25 - $6.30	$6.35 - $6.40	$6.40 - $6.45
Non-core expenses and revenue streams	$0.10 - $0.15	$0.25 - $0.25	$0.10 - $0.10	$0.10 - $0.10
Core Funds From Operations / share	$6.40 - $6.50	$6.50 - $6.55	$6.45 - $6.50	$6.50 - $6.55


(1)	Net non-cash rent adjustments represent the sum of straight-line rental revenue and straight-line rent expense, as well as the amortization of above- and below-market leases (i.e., ASC 805 adjustments).
(2)	The "same-capital" pool includes properties owned as of December 31, 2019 with less than 5% of total rentable square feet under development. It also excludes properties that were undergoing, or were expected to undergo, development activities in 2020-2021, properties classified as held for sale, and properties sold or contributed to joint ventures for all periods presented.
(3)	Includes land acquisitions.
(4)	Other non-recurring CapEx represents costs incurred to enhance the capacity or marketability of operating properties, such as network fiber initiatives and software development costs.
(5)	Recurring CapEx represents non-incremental improvements required to maintain current revenues, including second-generation tenant improvements and leasing commissions.

Non-GAAP Financial Measures

This press release contains non-GAAP financial measures, including FFO, core FFO and Adjusted EBITDA. A reconciliation from U.S. GAAP net income available to common stockholders to FFO, a reconciliation from FFO to core FFO, and definitions of FFO and core FFO are included as an attachment to this document. A reconciliation from U.S. GAAP net income available to common stockholders to Adjusted EBITDA, a definition of Adjusted EBITDA and definitions of net debt-to-Adjusted EBITDA, debt-plus-preferred-to-total enterprise value, cash NOI, and fixed charge coverage ratio are included as an attachment to this document.

Investor Conference Call

Prior to Digital Realty's investor conference call at 5:30 p.m. EDT / 2:30 p.m. PDT on October 26, 2021, a presentation will be posted to the Investors section of the company's website at https://investor.digitalrealty.com/. The presentation is designed to accompany the discussion of the company's third quarter 2021 financial results and operating performance. The conference call will feature Chief Executive Officer A. William Stein and Chief Financial Officer Andrew P. Power.

To participate in the live call, investors are invited to dial (888) 317-6003 (for domestic callers) or (412) 317-6061 (for international callers) and reference the conference ID# 0133975 at least five minutes prior to start time. A live webcast of the call will be available via the Investors section of Digital Realty's website at https://investor.digitalrealty.com/.

Telephone and webcast replays will be available after the call until November 23, 2021. The telephone replay can be accessed by dialing (877) 344-7529 (for domestic callers) or (412) 317-0088 (for international callers) and providing the conference ID# 10160289. The webcast replay can be accessed on Digital Realty's website.

About Digital Realty

Digital Realty supports the world's leading enterprises and service providers by delivering the full spectrum of data center, colocation and interconnection solutions. PlatformDIGITAL®, the company's global data center platform, provides customers a trusted foundation and proven Pervasive Datacenter Architecture (PDx™) solution methodology for scaling digital business and efficiently managing data gravity challenges. Digital Realty's global data center footprint gives customers access to the connected communities that matter to them with over 280 facilities in 49 metros across 25 countries on six continents. To learn more about Digital Realty, please visit digitalrealty.com or follow us on LinkedIn and Twitter.

Contact Information

Andrew P. Power
Chief Financial Officer
Digital Realty
(415) 738-6500

John J. Stewart / Jim Huseby
Investor Relations
Digital Realty
(415) 738-6500

Consolidated Quarterly Statements of Operations Unaudited and Dollars in Thousands, Except Per Share Data

	Three Months Ended					Nine Months Ended
	30-Sep-21	30-Jun-21	31-Mar-21	31-Dec-20	30-Sep-20		30-Sep-21	30-Sep-20
Rental revenues	$773,195	$768,826	$754,544	$754,422	$726,441		$2,296,565	$2,004,256
Tenant reimbursements - Utilities	189,060	169,743	184,973	154,937	155,111		543,776	410,207
Tenant reimbursements - Other	57,666	60,261	59,328	62,084	53,654		177,255	173,227
Interconnection & other	90,983	90,565	89,061	86,424	85,725		270,609	240,988
Fee income	3,255	3,628	2,426	4,722	3,687		9,309	10,492
Other	18,977	165	59	20	50		19,201	1,830
Total Operating Revenues	$1,133,136	$1,093,188	$1,090,391	$1,062,609	$1,024,668		$3,316,715	$2,841,000

Utilities	$209,585	$185,010	$176,046	$169,282	$177,925		$570,642	$467,623
Rental property operating	196,743	198,207	185,733	205,177	180,755		580,682	489,411
Property taxes	55,915	42,795	49,005	42,442	39,732		147,715	126,926
Insurance	4,718	5,703	3,498	3,410	2,926		13,919	9,843
Depreciation & amortization	369,035	368,981	369,733	359,915	365,842		1,107,749	1,006,464
General & administration	97,082	94,956	97,568	101,582	90,431		289,606	243,346
Severance, equity acceleration, and legal expenses	1,377	2,536	2,427	606	920		6,340	5,834
Transaction and integration expenses	13,804	7,075	14,120	19,290	14,953		34,999	87,372
Impairment of investments in real estate	—	—	—	—	6,482		—	6,482
Other expenses	510	2,298	(257)	641	297		2,551	433
Total Operating Expenses	$948,769	$907,561	$897,873	$902,345	$880,263		$2,754,203	$2,443,734

Operating Income	$184,367	$185,627	$192,518	$160,264	$144,405		$562,512	$397,266

Equity in (loss) earnings of unconsolidated joint ventures	40,884	52,143	(23,031)	31,055	(2,056)		69,996	(88,684)
Gain on sale / deconsolidation	(635)	499	333,921	1,684	10,410		333,785	315,211
Interest and other (expense) income, net	(2,947)	10,124	(7,186)	(2,747)	4,348		(9)	22,969
Interest (expense)	(71,417)	(75,014)	(75,653)	(77,848)	(89,499)		(222,084)	(255,173)
Income tax (expense)	(13,709)	(47,582)	(7,547)	(3,322)	(16,053)		(68,838)	(34,725)
Loss from early extinguishment of debt	—	—	(18,347)	(49,576)	(53,007)		(18,347)	(53,639)
Net Income / (Loss)	$136,543	$125,797	$394,675	$59,510	($1,452)		$657,015	$303,225

Net (income) loss attributable to noncontrolling interests	(2,266)	(4,544)	(8,756)	(1,818)	1,316		(15,566)	(4,515)
Net Income / (Loss) Attributable to Digital Realty Trust, Inc.	$134,277	$121,253	$385,919	$57,692	($136)		$641,449	$298,710

Preferred stock dividends, including undeclared dividends	(10,181)	(11,885)	(13,514)	(13,514)	(20,712)		(35,580)	(63,022)
Gain on / (Issuance costs associated with) redeemed preferred stock	—	18,000	—	—	(16,520)		18,000	(16,520)
Net Income / (Loss) Available to Common Stockholders	$124,096	$127,368	$372,405	$44,178	($37,368)		$623,869	$219,168

Weighted-average shares outstanding - basic	283,105,966	281,791,855	281,094,798	280,117,213	270,214,413		281,445,252	253,377,527
Weighted-average shares outstanding - diluted	283,817,950	282,433,857	281,928,182	281,122,368	270,214,413		282,075,611	256,362,579
Weighted-average fully diluted shares and units	290,253,718	289,484,805	289,210,666	288,903,143	281,523,515		289,218,609	264,401,464

Net income / (loss) per share - basic	$0.44	$0.45	$1.32	$0.16	($0.14)		$2.22	$0.86
Net income / (loss) per share - diluted	$0.44	$0.45	$1.32	$0.16	($0.14)		$2.21	$0.85

Funds From Operations and Core Funds From Operations Unaudited and in Thousands, Except Per Share Data

	Three Months Ended						Nine Months Ended
Reconciliation of Net Income to Funds From Operations (FFO)		30-Sep-21	30-Jun-21	31-Mar-21	31-Dec-20	30-Sep-20		30-Sep-21	30-Sep-20

Net Income / (Loss) Available to Common Stockholders		$124,096	$127,368	$372,405	$44,178	($37,368)		$623,869	$219,168
Adjustments:
Non-controlling interest in operating partnership		3,000	3,200	9,800	1,300	(1,000)		16,000	8,200
Real estate related depreciation & amortization (1)		362,728	363,640	364,697	354,366	358,619		1,091,065	987,470
Unconsolidated JV real estate related depreciation & amortization		21,293	20,983	19,378	21,471	19,213		61,654	56,259
(Gain) on real estate transactions (2)		(63,799)	(499)	(333,921)	(1,684)	(10,410)		(398,219)	(315,211)
Impairment of investments in real estate		-	-	-	-	6,482		-	6,482
Funds From Operations - diluted		$447,318	$514,692	$432,359	$419,631	$335,536		$1,394,369	$962,368

Weighted-average shares and units outstanding - basic		289,542	288,843	288,377	287,898	278,079		288,880	261,416
Weighted-average shares and units outstanding - diluted (3)		290,254	289,485	289,211	288,903	281,524		289,531	264,401

Funds From Operations per share - basic		$1.54	$1.78	$1.50	$1.46	$1.21		$4.83	$3.68

Funds From Operations per share - diluted (3)		$1.54	$1.78	$1.50	$1.45	$1.19		$4.82	$3.64

	Three Months Ended						Nine Months Ended
Reconciliation of FFO to Core FFO		30-Sep-21	30-Jun-21	31-Mar-21	31-Dec-20	30-Sep-20		30-Sep-21	30-Sep-20

Funds From Operations - diluted		$447,318	$514,692	$432,359	$419,631	$335,536		$1,394,369	$962,368
Termination fees and other non-core revenues (4)		(18,066)	(11,122)	(59)	(25)	(5,713)		(29,247)	(30,046)
Transaction and integration expenses		13,804	7,075	14,120	19,290	14,953		34,999	87,372
Loss from early extinguishment of debt		-	-	18,347	49,576	53,007		18,347	53,639
(Gain on) / Issuance costs associated with redeemed preferred stock		-	(18,000)	-	-	16,520		(18,000)	16,520
Severance, equity acceleration, and legal expenses (5)		1,377	2,536	2,427	606	920		6,340	5,834
(Gain) / Loss on FX revaluation		33,774	(51,649)	34,072	(27,190)	10,312		16,197	109,126
Other non-core expense adjustments		1,004	2,298	(19,240)	3,353	6,697		(15,938)	12,228
Core Funds From Operations - diluted		$479,211	$445,830	$482,026	$465,241	$432,232		$1,407,067	$1,217,041

Weighted-average shares and units outstanding - diluted (3)		290,254	289,485	289,211	288,903	281,524		289,531	264,401

Core Funds From Operations per share - diluted (3)		$1.65	$1.54	$1.67	$1.61	$1.54		$4.86	$4.60

(1) Real Estate Related Depreciation & Amortization	Three Months Ended						Nine Months Ended
		30-Sep-21	30-Jun-21	31-Mar-21	31-Dec-20	30-Sep-20		30-Sep-21	30-Sep-20

Depreciation & amortization per income statement		$369,035	$368,981	$369,733	$359,915	$365,842		1,107,749	1,006,464
Non-real estate depreciation		(6,307)	(5,341)	(5,036)	(5,549)	(7,223)		(16,684)	(18,994)
Real Estate Related Depreciation & Amortization		$362,728	$363,640	$364,697	$354,366	$358,619		$1,091,065	$987,470


(2)	For the third quarter 2021, includes a $64 million gain that represents Digital Realty's share from a sale of a portfolio of assets within an unconsolidated joint venture. The gain is included in equity in earnings of unconsolidated joint ventures in our consolidated income statement.
(3)	For all periods presented, we have excluded the effect of dilutive series C, series J, series K and series L preferred stock, as applicable, that may be converted into common stock upon the occurrence of specified change in control transactions as described in the articles supplementary governing the series C, series J, series K and series L preferred stock, as applicable, which we consider highly improbable. See above for calculations of diluted FFO and the share count detail section that follows the reconciliation of core FFO to AFFO for calculations of weighted average common stock and units outstanding. For definitions and discussion of FFO and core FFO, see the definitions section.
(4)	Includes lease termination fees and certain other adjustments that are not core to our business. For the third quarter 2021, includes a $19 million promote received related to a sale of portfolio of assets within an unconsolidated joint venture. The promote is included in Other revenue in our consolidated income statement.
(5)	Relates to severance and other charges related to the departure of company executives and integration-related severance.

Adjusted Funds From Operations (AFFO) Unaudited and in Thousands, Except Per Share Data

	Three Months Ended						Nine Months Ended
Reconciliation of Core FFO to AFFO		30-Sep-21	30-Jun-21	31-Mar-21	31-Dec-20	30-Sep-20		30-Sep-21	30-Sep-20

Core FFO available to common stockholders and unitholders		$479,211	$445,830	$482,026	$465,241	$432,232		$1,407,067	$1,217,041
Adjustments:
Non-real estate depreciation		6,307	5,341	5,036	5,549	7,223		16,684	18,994
Amortization of deferred financing costs		3,625	3,718	3,538	3,709	3,655		10,881	11,576
Amortization of debt discount/premium		1,138	1,166	1,134	1,033	987		3,438	2,941
Non-cash stock-based compensation expense		15,082	15,579	16,097	16,315	15,969		46,758	43,182
Straight-line rental revenue		(11,969)	(16,139)	(18,492)	(14,402)	(10,017)		(46,600)	(36,349)
Straight-line rental expense		7,862	7,175	6,709	3,629	3,934		21,746	12,767
Above- and below-market rent amortization		1,165	1,858	2,137	3,239	2,360		5,160	9,448
Deferred tax (expense) benefit		2,112	35,522	(4,509)	(4,226)	6,421		33,125	5,479
Leasing compensation & internal lease commissions		11,142	11,078	11,042	10,506	6,052		33,262	10,584
Recurring capital expenditures (1)		(50,800)	(39,231)	(39,522)	(83,571)	(53,683)		(129,553)	(127,156)

AFFO available to common stockholders and unitholders (2)		$464,875	$471,897	$465,196	$407,022	$415,133		$1,401,968	$1,168,507

Weighted-average shares and units outstanding - basic		289,542	288,843	288,377	287,898	278,079		288,880	261,416
Weighted-average shares and units outstanding - diluted (3)		290,254	289,485	289,211	288,903	281,524		289,531	264,401

AFFO per share - diluted (3)		$1.60	$1.63	$1.61	$1.41	$1.47		$4.84	$4.42

Dividends per share and common unit		$1.16	$1.16	$1.16	$1.12	$1.12		$3.48	$3.36

Diluted AFFO Payout Ratio		72.4%	71.2%	72.1%	79.5%	76.0%		71.9%	76.0%

	Three Months Ended						Nine Months Ended
Share Count Detail		30-Sep-21	30-Jun-21	31-Mar-21	31-Dec-20	30-Sep-20		30-Sep-21	30-Sep-20

Weighted Average Common Stock and Units Outstanding		289,542	288,843	288,377	287,898	278,079		288,880	261,416
Add: Effect of dilutive securities		712	642	834	1,005	3,445		651	2,985
Weighted Avg. Common Stock and Units Outstanding - diluted		290,254	289,485	289,211	288,903	281,524		289,531	264,401


(1)	Recurring capital expenditures represent non-incremental building improvements required to maintain current revenues, including second-generation tenant improvements and external leasing commissions. Recurring capital expenditures do not include acquisition costs contemplated when underwriting the purchase of a building, costs which are incurred to bring a building up to Digital Realty's operating standards, or internal leasing commissions.
(2)	For a definition and discussion of AFFO, see the definitions section. For a reconciliation of net income available to common stockholders to FFO and core FFO, see above.
(3)	For all periods presented, we have excluded the effect of dilutive series C, series J, series K and series L preferred stock, as applicable, that may be converted into common stock upon the occurrence of specified change in control transactions as described in the articles supplementary governing the series C, series J, series K and series L preferred stock, as applicable, which we consider highly improbable. See above for calculations of diluted FFO available to common stockholders and unitholders and for calculations of weighted average common stock and units outstanding.

Consolidated Balance Sheets Unaudited and in Thousands, Except Share and Per Share Data

	30-Sep-21		30-Jun-21		31-Mar-21		31-Dec-20		30-Sep-20
Assets
Investments in real estate:
Real estate		$23,384,809		$23,287,853		$22,762,279		$23,142,988		$22,125,486
Construction in progress		3,238,388		3,270,570		2,904,642		2,768,326		2,328,654
Land held for future development		118,091		143,575		192,896		226,862		198,536
Investments in real estate		$26,741,289		$26,701,998		$25,859,817		$26,138,175		$24,652,676
Accumulated depreciation and amortization		(6,159,294)		(5,919,650)		(5,649,019)		(5,555,221)		(5,250,140)
Net Investments in Properties		$20,581,995		$20,782,348		$20,210,798		$20,582,954		$19,402,536
Investment in unconsolidated joint ventures		1,292,325		1,119,026		970,703		1,148,158		1,059,978
Net Investments in Real Estate		$21,874,320		$21,901,374		$21,181,501		$21,731,112		$20,462,514

Cash and cash equivalents		$116,002		$120,482		$221,140		$108,501		$971,305
Accounts and other receivables (1)		610,416		630,086		657,096		603,111		585,506
Deferred rent		552,850		539,379		524,200		528,180		510,627
Customer relationship value, deferred leasing costs & other intangibles, net		2,871,622		2,956,027		3,057,245		3,122,904		3,106,414
Goodwill		8,062,914		8,185,931		8,125,706		8,330,996		8,012,256
Operating lease right-of-use assets (2)		1,442,661		1,452,633		1,495,869		1,386,959		1,363,285
Other assets		316,863		365,308		279,734		264,528		423,426
Total Assets		$35,847,648		$36,151,220		$35,542,491		$36,076,291		$35,435,333

Liabilities and Equity
Global unsecured revolving credit facilities		$832,322		$1,026,368		$451,007		$531,905		$124,082
Unsecured term loans		—		—		—		536,580		512,642
Unsecured senior notes, net of discount		13,012,790		12,659,043		12,566,198		11,997,010		11,999,170
Secured debt and other, net of premiums		242,427		242,410		239,634		239,222		238,866
Operating lease liabilities (2)		1,543,231		1,545,689		1,581,759		1,468,712		1,444,060
Accounts payable and other accrued liabilities		1,341,866		1,367,240		1,305,921		1,420,162		1,610,814
Deferred tax liabilities, net		725,955		742,127		650,543		698,308		711,474
Accrued dividends and distributions		—		—		—		324,386		571
Security deposits and prepaid rent		341,778		362,606		362,008		371,659		353,902
Total Liabilities		$18,040,369		$17,945,483		$17,157,070		$17,587,944		$16,995,581

Redeemable non-controlling interests - operating partnership		40,924		41,490		40,097		42,011		41,265

Equity
Preferred Stock: $0.01 par value per share, 110,000,000 shares authorized:
Series C Cumulative Redeemable Perpetual Preferred Stock ⁽³⁾		—		—		$219,250		$219,250		$219,250
Series J Cumulative Redeemable Preferred Stock ⁽⁴⁾		$193,540		$193,540		193,540		193,540		193,540
Series K Cumulative Redeemable Preferred Stock ⁽⁵⁾		203,264		203,264		203,264		203,264		203,264
Series L Cumulative Redeemable Preferred Stock ⁽⁶⁾		334,886		334,886		334,886		334,886		334,886
Common Stock: $0.01 par value per share, 392,000,000 shares authorized ⁽⁷⁾		2,818		2,806		2,795		2,788		2,784
Additional paid-in capital		21,010,202		20,844,834		20,700,282		20,626,897		20,566,645
Dividends in excess of earnings		(4,358,933)		(4,153,407)		(3,952,497)		(3,997,938)		(3,726,901)
Accumulated other comprehensive income (loss), net		(111,560)		31,733		(77,783)		135,010		(123,623)
Total Stockholders' Equity		$17,274,217		$17,457,656		$17,623,737		$17,717,697		$17,669,845

Noncontrolling Interests
Noncontrolling interest in operating partnership		$459,814		$513,897		$571,292		$608,980		$620,676
Noncontrolling interest in consolidated joint ventures		32,324		192,694		150,295		119,659		107,966

Total Noncontrolling Interests		$492,138		$706,591		$721,587		$728,639		$728,642

Total Equity		$17,766,355		$18,164,247		$18,345,324		$18,446,336		$18,398,487

Total Liabilities and Equity		$35,847,648		$36,151,220		$35,542,491		$36,076,291		$35,435,333


(1)	Net of allowance for doubtful accounts of $24,038 and $18,825 as of September 30, 2021 and December 31, 2020, respectively.
(2)	Adoption of the new lease accounting standard required that we adjust the consolidated balance sheet to include the recognition of additional right-of-use assets and lease liabilities for operating leases. See our quarterly report on Form 10–Q filed on May 10, 2019 for additional information.
(3)	Series C Cumulative Redeemable Perpetual Preferred Stock, 6.625%, $0 and $201,250 liquidation preference, respectively ($25.00 per share), 0 and 8,050,000 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively.
(4)	Series J Cumulative Redeemable Preferred Stock, 5.250%, $200,000 and $200,000 liquidation preference, respectively ($25.00 per share), 8,000,000 and 8,000,000 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively.
(5)	Series K Cumulative Redeemable Preferred Stock, 5.850%, $210,000 and $210,000 liquidation preference, respectively ($25.00 per share), 8,400,000 and 8,400,000 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively.
(6)	Series L Cumulative Redeemable Preferred Stock, 5.200%, $345,000 and $345,000 liquidation preference, respectively ($25.00 per share), 13,800,000 and 13,800,000 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively.
(7)	Common Stock: 283,846,802 and 208,900,758 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectivel

Reconciliation of Earnings Before Interest, Taxes, Depreciation & Amortization and Financial Ratios Unaudited and Dollars in Thousands

	Three Months Ended
Reconciliation of Earnings Before Interest, Taxes, Depreciation & Amortization (EBITDA) ⁽¹⁾		30-Sep-21	30-Jun-21	31-Mar-21	31-Dec-20	30-Sep-20

Net Income / (Loss) Available to Common Stockholders		$124,096	$127,368	$372,405	$44,178	($37,368)
Interest		71,417	75,014	75,653	77,848	89,499
Loss from early extinguishment of debt		—	—	18,347	49,576	53,007
Income tax expense (benefit)		13,709	47,582	7,547	3,322	16,053
Depreciation & amortization		369,035	368,981	369,733	359,915	365,842
EBITDA		$578,257	$618,945	$843,685	$534,839	$487,033
Unconsolidated JV real estate related depreciation & amortization		21,293	20,983	19,378	21,471	19,213
Unconsolidated JV interest expense and tax expense		11,008	15,523	8,786	12,143	9,002
Severance, equity acceleration, and legal expenses		1,377	2,536	2,427	606	920
Transaction and integration expenses		13,804	7,075	14,120	19,290	14,953
(Gain) on sale / deconsolidation		635	(499)	(333,921)	(1,684)	(10,410)
Impairment of investments in real estate		—	—	—	—	6,482
Other non-core adjustments, net		(28,745)	(60,308)	38,574	(23,842)	4,945
Non-controlling interests		2,266	4,544	8,756	1,818	(1,316)
Preferred stock dividends, including undeclared dividends		10,181	11,885	13,514	13,514	20,712
(Gain on) / Issuance costs associated with redeemed preferred stock		—	(18,000)	—	—	16,520
Adjusted EBITDA		$610,076	$602,684	$615,319	$578,156	$568,054

(1) For definitions and discussion of EBITDA and Adjusted EBITDA, see the definitions section.



	Three Months Ended
Financial Ratios		30-Sep-21	30-Jun-21	31-Mar-21	31-Dec-20	30-Sep-20

Total GAAP interest expense		$71,417	$75,014	$75,653	$77,848	$89,499
Capitalized interest		15,142	11,558	11,434	11,836	12,379
Change in accrued interest and other non-cash amounts		17,820	(43,604)	44,620	(37,182)	19,718
Cash Interest Expense ⁽²⁾		$104,379	$42,968	$131,707	$52,502	$121,596

Preferred dividends		10,181	11,885	13,514	13,514	20,712
Total Fixed Charges ⁽³⁾		$96,740	$98,457	$100,601	$103,198	$122,590


Coverage
Interest coverage ratio ⁽⁴⁾		6.5x	6.1x	6.6x	5.8x	5.2x
Cash interest coverage ratio ⁽⁵⁾		5.4x	10.9x	4.5x	9.3x	4.4x
Fixed charge coverage ratio ⁽⁶⁾		5.8x	5.4x	5.8x	5.1x	4.4x
Cash fixed charge coverage ratio ⁽⁷⁾		5.0x	9.0x	4.1x	7.7x	3.8x

Leverage
Debt to total enterprise value ^{(8) (9)}		24.8%	23.9%	24.1%	24.4%	22.8%
Debt plus preferred stock to total enterprise value ⁽¹⁰⁾		26.1%	25.2%	25.9%	26.2%	25.0%
Pre-tax income to interest expense ⁽¹¹⁾		2.9x	2.7x	6.2x	1.8x	1.0x
Net Debt to Adjusted EBITDA ⁽¹²⁾		6.0x	6.0x	5.6x	6.0x	5.5x


(2)	Cash interest expense is interest expense less amortization of debt discount and deferred financing fees and includes interest that we capitalized. We consider cash interest expense to be a useful measure of interest as it excludes non-cash based interest expense.
(3)	Fixed charges consist of GAAP interest expense, capitalized interest, and preferred dividends.
(4)	Adjusted EBITDA divided by GAAP interest expense plus capitalized interest (including our pro rata share of unconsolidated joint venture interest expense).
(5)	Adjusted EBITDA divided by cash interest expense (including our pro rata share of unconsolidated joint venture interest expense).
(6)	Adjusted EBITDA divided by fixed charges (including our pro rata share of unconsolidated joint venture fixed charges).
(7)	Adjusted EBITDA divided by the sum of cash interest expense, and preferred dividends (including our pro rata share of unconsolidated joint venture cash fixed charges).
(8)	Mortgage debt and other loans divided by market value of common equity plus debt plus preferred stock.
(9)	Total enterprise value defined as market value of common equity plus debt plus preferred stock.
(10)	as (8), except numerator includes preferred stock.
(11)	Calculated as net income plus interest expense divided by GAAP interest expense.
(12)	Calculated as total debt at balance sheet carrying value, plus capital lease obligations, plus Digital Realty's pro rata share of unconsolidated of joint venture debt, less cash and cash equivalents (including Digital Realty's pro rata share of unconsolidated joint venture cash) divided by the product of Adjusted EBITDA (including Digital Realty's pro rata share of unconsolidated joint venture EBITDA), multiplied by four.

Management Statements on Non-GAAP Measures
Unaudited

Definitions

Funds From Operations (FFO):
We calculate funds from operations, or FFO, in accordance with the standards established by the National Association of Real Estate Investment Trusts, or Nareit, in the Nareit Funds From Operations White Paper - 2018 Restatement. FFO represents net income (loss) (computed in accordance with GAAP), excluding gains (or losses) from real estate transactions, impairment of investment in real estate, real estate related depreciation and amortization (excluding amortization of deferred financing costs), unconsolidated JV real estate related depreciation & amortization, non-controlling interests in operating partnership and after adjustments for unconsolidated partnerships and joint ventures. 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.

Core Funds from Operations (Core FFO):
We present core funds from operations, or core FFO, as a supplemental operating measure because, in excluding certain items that do not reflect core revenue or expense streams, it provides a performance measure that, when compared year over year, captures trends in our core business operating performance. We calculate core FFO by adding to or subtracting from FFO (i) termination fees and other non-core revenues, (ii) transaction and integration expenses, (iii) loss from early extinguishment of debt, (iv) gain on / issuance costs associated with redeemed preferred stock, (v) severance, equity acceleration, and legal expenses, (vi) gain/loss on FX revaluation, and (vii) other non-core expense adjustments. Because certain of these adjustments have a real economic impact on our financial condition and results from operations, the utility of core FFO as a measure of our performance is limited. Other REITs may calculate core FFO differently than we do and accordingly, our core FFO may not be comparable to other REITs' core FFO. Core FFO should be considered only as a supplement to net income computed in accordance with GAAP as a measure of our performance.

Adjusted Funds from Operations (AFFO):
We present adjusted funds from operations, or AFFO, as a supplemental operating measure because, when compared year over year, it assesses our ability to fund dividend and distribution requirements from our operating activities. We also believe that, as a widely recognized measure of the operations of REITs, AFFO will be used by investors as a basis to assess our ability to fund dividend payments in comparison to other REITs, including on a per share and unit basis. We calculate AFFO by adding to or subtracting from core FFO (i) non-real estate depreciation, (ii) amortization of deferred financing costs, (iii) amortization of debt discount/premium, (iv) non-cash stock-based compensation expense, (v) straight-line rental revenue, (vi) straight-line rental expense, (vii) above- and below-market rent amortization, (viii) deferred tax (expense) benefit, (ix) leasing compensation and internal lease commissions, and (x) recurring capital expenditures. Other REITs may calculate AFFO differently than we do and, accordingly, our AFFO may not be comparable to other REITs' AFFO. AFFO should be considered only as a supplement to net income computed in accordance with GAAP as a measure of our performance.

EBITDA and Adjusted EBITDA:
We believe that earnings before interest, loss from early extinguishment of debt, income taxes, and depreciation and amortization, or EBITDA, and Adjusted EBITDA (as defined below), are useful supplemental performance measures because they allow investors to view our performance without the impact of non-cash depreciation and amortization or the cost of debt and, with respect to Adjusted EBITDA, unconsolidated joint venture real estate related depreciation & amortization, unconsolidated joint venture interest expense and tax, severance, equity acceleration, and legal expenses, transaction and integration expenses, gain on sale / deconsolidation, impairment of investments in real estate, other non-core adjustments, net, non-controlling interests, preferred stock dividends, including undeclared dividends, and issuance costs associated with redeemed preferred stock. Adjusted EBITDA is EBITDA excluding unconsolidated joint venture real estate related depreciation & amortization, unconsolidated joint venture interest expense and tax, severance, equity acceleration, and legal expenses, transaction and integration expenses, gain on sale / deconsolidation, impairment of investments in real estate, other non-core adjustments, net, non-controlling interests, preferred stock dividends, including undeclared dividends, and gain on / issuance costs associated with redeemed preferred stock. In addition, we believe EBITDA and Adjusted EBITDA are frequently used by securities analysts, investors and other interested parties in the evaluation of REITs. Because EBITDA and Adjusted EBITDA are calculated before recurring cash charges including interest expense and income taxes, exclude capitalized costs, such as leasing commissions, and are not adjusted for capital expenditures or other recurring cash requirements of our business, their utility as a measure of our performance is limited. Other REITs may calculate EBITDA and Adjusted EBITDA differently than we do and, accordingly, our EBITDA and Adjusted EBITDA may not be comparable to other REITs' EBITDA and Adjusted EBITDA. Accordingly, EBITDA and Adjusted EBITDA should be considered only as supplements to net income computed in accordance with GAAP as a measure of our financial performance.

Net Operating Income (NOI) and Cash NOI:
Net operating income, or NOI, represents rental revenue, tenant reimbursement revenue and interconnection revenue less utilities expense, rental property operating expenses, property taxes and insurance expenses (as reflected in the statement of operations). NOI is commonly used by stockholders, company management and industry analysts as a measurement of operating performance of the company's rental portfolio. Cash NOI is NOI less straight-line rents and above- and below-market rent amortization. Cash NOI is commonly used by stockholders, company management and industry analysts as a measure of property operating performance on a cash basis. However, because NOI and cash NOI exclude depreciation and amortization and capture 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 results from operations, the utility of NOI and cash NOI as measures of our performance is limited. Other REITs may calculate NOI and cash NOI differently than we do and, accordingly, our NOI and cash NOI may not be comparable to other REITs' NOI and cash NOI. NOI and cash NOI should be considered only as supplements to net income computed in accordance with GAAP as measures of our performance.

Additional Definitions

Net debt-to-Adjusted EBITDA ratio is calculated using total debt at balance sheet carrying value, plus capital lease obligations, plus our share of unconsolidated JV debt, less unrestricted cash and cash equivalents (including our share of unconsolidated JV cash) divided by the product of Adjusted EBITDA (inclusive of our share of unconsolidated JV EBITDA) multiplied by four.

Debt-plus-preferred-to-total enterprise value is mortgage debt and other loans plus preferred stock divided by mortgage debt and other loans plus the liquidation value of preferred stock and the market value of outstanding Digital Realty Trust, Inc. common stock and Digital Realty Trust, L.P. units, assuming the redemption of Digital Realty Trust, L.P. units for shares of Digital Realty Trust, Inc. common stock.

Fixed charge coverage ratio is Adjusted EBITDA divided by the sum of GAAP interest expense, capitalized interest, scheduled debt principal payments and preferred dividends. For the quarter ended September 30, 2021, GAAP interest expense was $71 million, capitalized interest was $15 million and scheduled debt principal payments and preferred dividends was $10 million.


Reconciliation of Net Operating Income (NOI)	Three Months Ended						Nine Months Ended
(in thousands)	30-Sep-21		30-Jun-21		30-Sep-20		30-Sep-21		30-Sep-20

Operating income		$184,367		$185,627		$144,405		$562,512		$397,266

Fee income		(3,255)		(3,628)		(3,687)		(9,309)		(10,492)
Other income		(18,977)		(165)		(50)		(19,201)		(1,830)
Depreciation and amortization		369,035		368,981		365,842		1,107,749		1,006,464
General and administrative		97,082		94,956		90,431		289,606		243,346
Severance, equity acceleration, and legal expenses		1,377		2,536		920		6,340		5,834
Transaction expenses		13,804		7,075		14,953		34,999		87,372
Other expenses		510		2,298		297		2,551		433

Net Operating Income		$643,943		$657,680		$619,593		$1,975,247		$1,734,875


Cash Net Operating Income (Cash NOI)

Net Operating Income		$643,943		$657,680		$619,593		$1,975,247		$1,734,875

Straight-line rental revenue		(12,029)		(17,127)		(9,215)		(47,763)		(33,321)
Straight-line rental expense		7,779		7,069		3,674		21,598		12,465
Above- and below-market rent amortization		1,165		1,858		2,360		5,158		9,447

Cash Net Operating Income		$640,858		$649,480		$616,412		$1,954,240		$1,723,466

Forward-Looking Statements

This document contains forward-looking statements within the meaning of the federal securities laws, which are based on current expectations, forecasts and assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially. Such forward-looking statements include statements relating to: our economic outlook, our expected investment and expansion activity, our expected physical settlement of the forward sale agreements and use of proceeds from any such settlement, the COVID-19 pandemic, our liquidity, our joint ventures, supply and demand for data center and colocation space, our acquisition and disposition activity, pricing and net effective leasing economics, market dynamics and data center fundamentals, our strategic priorities, our product offerings, available inventory rent from leases that have been signed but have not yet commenced and other contracted rent to be received in future periods, rental rates on future leases, lag between signing and commencement, cap rates and yields, investment activity, the company's FFO, core FFO and net income, 2021 outlook and underlying assumptions, information related to trends, our strategy and plans, leasing expectations, weighted average lease terms, the exercise of lease extensions, lease expirations, debt maturities, annualized rent at expiration of leases, the effect new leases and increases in rental rates will have on our rental revenue, our credit ratings, construction and development activity and plans, projected construction costs, estimated yields on investment, expected occupancy, expected square footage and IT load capacity upon completion of development projects, 2021 backlog NOI, NAV components, and other forward-looking financial data. Such statements are based on management's beliefs and assumptions made based on information currently available to management. Such statements are subject to risks, uncertainties and assumptions and are not guarantees of future performance and may be affected by known and unknown risks, trends, uncertainties and factors that are beyond our control. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or projected. Some of the risks and uncertainties that may cause our actual results, performance or achievements to differ materially from those expressed or implied by forward-looking statements include, among others, the following:

reduced demand for data centers or decreases in information technology spending;
increased competition or available supply of data center space;
decreased rental rates, increased operating costs or increased vacancy rates;
the suitability of our data centers and data center infrastructure, delays or disruptions in connectivity or availability of power, or failures or breaches of our physical and information security infrastructure or services;
our dependence upon significant customers, bankruptcy or insolvency of a major customer or a significant number of smaller customers, or defaults on or non-renewal of leases by customers;
our ability to attract and retain customers;
breaches of our obligations or restrictions under our contracts with our customers;
our inability to successfully develop and lease new properties and development space, and delays or unexpected costs in development of properties;
the impact of current global and local economic, credit and market conditions;
our inability to retain data center space that we lease or sublease from third parties;
global supply chain or procurement disruptions, or increased supply chain costs;
information security and data privacy breaches;
difficulty managing an international business and acquiring or operating properties in foreign jurisdictions and unfamiliar metropolitan areas;
our failure to realize the intended benefits from, or disruptions to our plans and operations or unknown or contingent liabilities related to, our recent acquisitions;
our failure to successfully integrate and operate acquired or developed properties or businesses;
difficulties in identifying properties to acquire and completing acquisitions;
risks related to joint venture investments, including as a result of our lack of control of such investments;
risks associated with using debt to fund our business activities, including re-financing and interest rate risks, our failure to repay debt when due, adverse changes in our credit ratings or our breach of covenants or other terms contained in our loan facilities and agreements;
our failure to obtain necessary debt and equity financing, and our dependence on external sources of capital;
financial market fluctuations and changes in foreign currency exchange rates;
adverse economic or real estate developments in our industry or the industry sectors that we sell to, including risks relating to decreasing real estate valuations and impairment charges and goodwill and other intangible asset impairment charges;
our inability to manage our growth effectively;
losses in excess of our insurance coverage;
our inability to attract and retain talent;
impact of the COVID-19 pandemic on our operations and on the operations of our customers, suppliers and business partners
environmental liabilities, risks related to natural disasters and our inability to achieve our sustainability goals;
our inability to comply with rules and regulations applicable to our company;
Digital Realty Trust, Inc.'s failure to maintain its status as a REIT for federal income tax purposes;
Digital Realty Trust, L.P.'s failure to qualify as a partnership for federal income tax purposes;
restrictions on our ability to engage in certain business activities;
changes in local, state, federal and international laws and regulations, including related to taxation, real estate and zoning laws, and increases in real property tax rates; and
the impact of any financial, accounting, legal or regulatory issues or litigation that may affect us.

The risks included here are not exhaustive, and additional factors could adversely affect our business and financial performance. Several additional material risks are discussed in our annual report on Form 10–K for the year ended December 31, 2020 and other filings with the U.S. Securities and Exchange Commission. Those risks continue to be relevant to our performance and financial condition. Moreover, we operate in a very competitive and rapidly changing environment. New risk factors emerge from time to time and it is not possible for management to predict all such risk factors, nor can it assess the impact of all such risk factors on the business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. We expressly disclaim any responsibility to update forward-looking statements, whether as a result of new information, future events or otherwise. Digital Realty, Digital Realty Trust, the Digital Realty logo, Interxion, Turn-Key Flex, Powered Base Building, and PlatformDIGITAL, Data Gravity Index and Data Gravity Index DGx are registered trademarks and service marks of Digital Realty Trust, Inc. in the United States and/or other countries. All other names, trademarks and service marks are the property of their respective owners.

SOURCE Digital Realty