Strong 1Q Leasing for Digital Realty

Digital Realty Trust (DLR) said it leased more than 241,000 square feet of space in the first three months of 2010. Most of the leasing was for the company's "plug-n-play" Turn-Key Datacenter product.

The first quarter leasing was strong for Digital Realty Trust, the company said yesterday. The real estate investment trust, which is the largest operator of wholesale data centers, said it had leased more than 241,000 square feet of space in the first three months of 2010.

Customers continued to show strong interest in Digital's Turn-Key Datacenter program, which accounted for 171,000 square feet of the new leasing. The turn-key program offers customers finished ”plug and play” raised-floor data center space, which shifts the data center development costs from the tenant to the landlord, and allows for much quicker deployment than if the customer built a new facility on its own.

"Leasing activity continued to gain momentum during the first quarter, resulting in the strongest first quarter on record for Turn-Key Datacenter leases signed," said Michael Foust, CEO of Digital Realty Trust. "Overall, it was one of the best first quarters for leases signed, second only to the first quarter of 2008.

'Fully Leased' in Virginia
"To keep up with this level of demand for our Turn-Key space, we have accelerated plans to bring on additional space in select markets, such as Northern Virginia, where we are fully leased," said Foust.

On April 6 Digital Realty announced plans to build two new data center buildings in Ashburn, Va. that will add a total of 270,000 gross square feet of space and 34 megawatts of available power to the company's footprint in the key northern Virginia market.

Digital Realty's turn-key leases in the first quarter were signed at an average annual GAAP rental rate of $141.00 per square foot,while 69,000 square feet of non-technical space leased at an average annual GAAP rental rate of $25 per square foot.

For the quarter ended March 31, the company commenced leases totaling approximately 116,000 square feet of space. This includes approximately 108,000 square feet of Turn-Key space leased at $139 per square foot and approximately 7,500 square feet of non-technical space leased at $37.00 per square foot.

A lease commences when the tenant occupies the facility, which often lags the lease signing by a few months.

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