Digital Realty Trust, Inc. · NYSE:DLR
Digital Realty Trust — Citigroup 17th Annual Entertainment, Media & Telecommunications Conference 2007
22 slides from Digital Realty Trust's conference presentation, Jan 10, 2007
Slide 1: Citigroup 17th Annual Entertainment, Media & Telecommunications Conference
Exhibit 99.2 Foundation for the Digital World th Citigroup 17 Annual Entertainment, Media & Telecommunications Conference January 2007
Slide 2: Forward Looking Statements
Forward Looking Statements The information included in this presentation contains forward-looking statements. Such statements are based on management’s beliefs and assumptions made based on information currently available to management. Such forward looking statements include statements and projecti
Slide 3: Digital Realty Trust overview
Digital Realty Trust overview DLR is a leading institutional owner focused on mission critical technology properties throughout North America and Europe Tenants consist of leading global companies diversified across various industries Own 60 properties comprising 11.4 million rentable sq ft which in
Slide 4: DLR Investment Highlights
DLR Investment Highlights Specialized focus in dynamic and growing industries High quality portfolio that is difficult to replicate Proven track record of creating shareholder value Conservative and flexible capital structure Industry leading domestic and international datacenter development and cri
Slide 5: DLR properties feature advanced technical systems
DLR properties feature advanced technical systems Power management/conversion Precision air cooling/handling Power backup/redundancy Systems and security controls Between $500 and $1000 psf typically invested in DLR buildings, creating a barrier to exit for tenants and discouraging speculative new s
Slide 6: DLR Presence in 25 Top Markets
DLR Presence in 25 Top Markets (1) Total Rentable # of Properties # of Buildings Square Feet Domestic 52 72 10,530,000 International 8 8 866,000 Total 60 80 11,396,000 (1) Includes properties acquired as of December 31, 2006 5
Slide 7: DLR provides datacenter facilities solutions worldwide
DLR provides datacenter facilities solutions worldwide Financial Corporate Communications Internet Enterprise Technology Datacenters Corporate Datacenters (40%(1)) Internet Gateways (43%(1)) • Storage/server intensive buildings • Internet and telecom network • Provide a secure 24 x 7 environment int
Slide 8: Strong trends drive sustained demand for DLR space
Strong trends drive sustained demand for DLR space Primary Drivers – Estimated Annual Growth Rates Other Growth Drivers 100% By 2008, 50% of existing corporate data centers will have insufficient power and cooling capacity to meet the 80 demands of high-density equipment (4) 73% Increased federal re
Slide 9: DLR offers sustained growth
DLR offers sustained growth DLR growth is derived from three sources Acquisitions Leasing of Turn-key Datacenter Space Redevelopment Inventory 8
Slide 10: Proven Track Record: Strong Acquisition Activity
Proven Track Record: Strong Acquisition Activity Since its IPO, DLR has more than doubled its total assets through property acquisitions Total Undepreciated Assets ($000) $2.0B $2,000 $1,794.4 $1,800 $1,648.2 $1,593.6 $1,600 $1,508.5 $1,413.4 $1,400 $1,200 $1,137.4 $1,044.3 $1,000 $847.2 $800 $600 $
Slide 11: 2005 & 2006 Acquisitions
2005 & 2006 Acquisitions Acquired 36+ properties totaling over $1.0 billion Added approximately 6.1 million square feet to total portfolio, including 1.0 million square feet of redevelopment inventory New markets include: – Philadelphia – St. Paul – Chicago – Charlotte – Amsterdam, Netherlands – Gen
Slide 12: Leasing Drives Internal Growth
Leasing Drives Internal Growth DLR executed 173 leases in the first nine months of 2006, contributing approximately $21.7M in annualized GAAP rental revenues (1) Total SF Annualized Type of Space # of Leases Leased GAAP Rent Turn-key Datacenter 144 185,000 $16.5 million Redevelopment 5 72,000 $3.9 m
Slide 13: Case Studies: DLR's Value-Add Leasing
Case Studies: DLR’s Value-Add Leasing % Change in NOI from later of Acquisition / Acquisition or (1) Property Name Location IPO Date IPO 200 Paul Avenue San Francisco, CA Nov-04 34.8% 600 West Seventh Street Los Angeles, CA Nov-04 16.7% 1100 Space Park Drive Santa Clara, CA Nov-04 53.0% 350 East Cer
Slide 14: DLR Redevelopment Inventory
DLR Redevelopment Inventory Growth Opportunity Redevelopment inventory totals 1.5 million sf of vacant space with potential for up to 900,000 sf of datacenter: – Approximately 55% of inventory in income producing properties – Remaining 45% of inventory in 5 recently acquired vacant buildings Redevel
Slide 15: DLR's Competitive Advantage: Dedicated Technical Professionals
DLR’s Competitive Advantage: Dedicated Technical Professionals Operating scale and process-based approach result in significant cost savings and added value for tenants Over 25 DLR technical professionals: – IT sales team Focus on end-user, IT professionals (CIO or CTO) – Datacenter sales engineers
Slide 16: DLR's model features long-term, stable leases
DLR’s model features long-term, stable leases Lease Expiration as a % of Net Rentable Square Feet 26.0% 17.1% 15.8% 9.3% 5.0% in through 2008 7.4% 5.6% 5.0% 3.9% 1.6% 1.1% 2007 2008 2009 2010 2011 2012 2013 2014 2015 Thereafter • The average lease term is approximately 12 years with 7 years remainin
Slide 17: DLR 2007 Guidance
DLR 2007 Guidance (1)(2) 2007 Projected Funds From Operations (FFO) Per Share Guidance : $1.85 to $1.95 Leasing 475,000 to 600,000 sq ft of turn- key & redevelopment space 11.6% to 14.7% (gross rent $80 / sq ft) Internal Growth FFO (2) Per Share Growth 100,000 to 125,000 sq ft of basic commercial sp
Slide 18: Digital Realty Financial Overview
Digital Realty Financial Overview Strong and Consistent FFO (1) Growth – $0.41 per diluted share and unit for 3Q06, + 17% from 3Q05 and + 8% from 2Q06 Well Supported Dividend – 3.3% yield (2) – FFO / AFFO payout ratio of 66% / 90% (3) for 3Q06 – Increased quarterly common dividend in 4Q06, +8% Prove
Slide 19: DLR employs a conservative capital structure
DLR employs a conservative capital structure Wtd Average Cost of Variable Rate Debt 4.5% (3) Debt: 5.63%; Preferred Stock Fixed Rate Debt 4.6% Approximately 86% fixed 26.7% (2)(4) rate debt (4) Periodically refinancing high cost debt with lower rate, longer term, fixed Equity (1) rate financing 64.2
Slide 20: Digital Realty Trust
DIGITAL REALTY TRUST providing the foundation for the digital world
Slide 21: Definition of Non-GAAP Financial Measures
Definition of Non-GAAP Financial Measures This presentation includes certain non-GAAP financial measures that management believes are helpful in understanding our business, as further described below. Our definition and calculation of non-GAAP financial measures may differ from those of other REITs,
Slide 22: Reconciliation of non GAAP items to their closest GAAP
Reconciliation of non GAAP items to their closest GAAP (1) Funds from operations Cash paid for interest (including discontinued operations) Q306 Q206 Q305 FY2005 Q306 Q206 FY2005 Total GAAP interest expense (including Net income available to common stockholders $11,342 $1,650 $1,326 $6,087 discontin