Digital Realty To Sell Non-Core Mixed-use Data Center Property In $205 Mln Deal

(RTTNews) - Digital Realty Trust Inc. (DLR), a provider of cloud- and carrier-neutral data center, colocation and interconnection solutions, announced Monday its definitive agreement to sell a non-core, mixed-use data center property. The transaction values the asset at around $205 million.

The transaction is expected to close in the third quarter of 2022, subject to customary closing conditions.

The property is expected to generate 2022 cash net operating income of approximately $10.7 million, representing a 5.2% cap rate.

Digital Realty originally acquired the 370,000 square foot facility in 2004, prior to its IPO. The company gets the majority of the rental revenue from a Tier III Powered Base Building data center. A portion of the property is leased to commercial and retail tenants on a longer-term basis.

Digital Realty expects proceeds from the sale will initially be used to pay down debt and will ultimately be used to fund future investment activity.

Digital Realty Chief Investment Officer Greg Wright said the disposition opportunistically recycles an operationally mature asset to fund strategic investments aimed at enhancing the company's longer-term growth profile.