Digital Realty Trust is planning to exit several secondary markets. Speaking in the Q3 2014 earnings call Bill Stein, Digital Realty interim CEO said this was due to customer demand, particularly in Germany and Japan.
Also within the quarter Digital Realty entered a joint marketing alliance with VMware and an agreement with Carpathia to make its product offerings directly available to the company.
Digital Realty offers direct connections to VMware’s vCloud Air public cloud platform enabling its customers to extend existing workloads into the cloud using a dedicated private line.
Stein also said they had identified nine properties for disposition. Digital Realty co-founder and CIO Scott Peterson said leasing activity at the four remaining properties has picked up ‘considerably’ over the past 90 days.
“We are in the process of finalizing some new leases, which has affected the timing of bringing these properties to market. However, this should increase the value of these properties and maximize proceeds to our shareholders,” Peterson said. “These nine assets represent roughly the first third of properties under evaluation for the capital recycling program, which comprises roughly 5 percent to 10 percent of the portfolio.”
Digital Realty’s revenues were $412m for Q3 2014, a 3% increase over Q2 2014 and a 9% increase over the Q3 2013. The company’s net income for Q3 2014 was $130m down from $153m in Q3 2013.
Funds from operations ("FFO") on a diluted basis stood at $169m for Q3 2014, or $1.22 per share, compared to $1.20 per share in Q2 2014 and $1.10 per share Q3 2013.