Digital Realty Buys London Sites for $1.1 Billion
Digital Realty Trust is buying big in London. The data center developer said today that it will pay about $1.1 billion (715 million pounds) to acquire three large data centers in the London market from UK provider Sentrum. The deal provides Digital Realty with another 761,000 square feet of data center space in one of the world’s key data center capitals.
The Sentrum properties provide both current income and some upside for leasing unfilled data center space, a combination Digital likes. The portfolio – which includes properties in Woking, Watford and Croydon - is 80 percent leased to 21 tenants, including leading multinational financial institutions and global network providers. “In addition to the stable in-place income, there is “a significant value-add opportunity to lease the balance of the portfolio’s available space, ” said Scott Peterson, Chief Acquisitions Officer for Digital Realty.
To help fund the Sentrum purchase, Digital Realty will sell 8.25 million shares of its common stock in an underwritten public offering, the company said. It will also use several of its credit facilities and available cash to finance the deal, which has an “earn out” component based upon future leasing of the vacant space.
“We believe the addition of these high quality, mission critical facilities to our operating portfolio will enable us to serve a wide variety of customers seeking institutional quality data center space in London, a highly strategic global data center market,” said Michael F. Foust, CEO of Digital Realty.
The Sentrum deal caps an extraordinarily busy month in which Digital Realty has acquired a data center campus in suburban Chicago, a fully-leased property in Austin, and a key Dallas data center hub at 400 South Akard, in addition to the Sentrum deal.
Just a friendly note to let you know that billion is spelled incorrectly in your header.