Item 2. PROPERTIES

General

In addition to the information in this Item 2, certain information regarding our portfolio is contained in Schedule III (Financial Statement Schedule) under Part IV, Item 15(a) (2) and which is included in Part II, Item 8.

Our Portfolio

As of December 31, 2019, our portfolio consisted of 225 data centers, including 41 data centers held as investments in unconsolidated joint ventures, and contain a total of approximately 36.6 million rentable square feet, including 4.5 million square feet of space under active development and 1.8 million square feet of space held for development. The following table presents an overview of our portfolio of properties, including the 41 data centers held as investments in unconsolidated joint ventures and developable land, based on information as of December 31, 2019 (dollar amounts in thousands). All data centers are held in fee simple except as otherwise indicated. Please refer to Note 8 in the Notes to the Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K for a description of all applicable encumbrances as of December 31, 2019.

Index to Financial Statements


				Space Under
		Data Center	Net Rentable	Active	Space Held for	Annualized		Occupancy
Metropolitan Area		Buildings	Square Feet (1)	Development (2)	Development (3)	Rent (4)		Percentage (5)

North America
Northern Virginia		23	5,332,240	717,918	81,195	$	520,222	90.4	%
Chicago		10	3,040,208	386,604	148,650		288,526	86.6	%
New York		12	2,048,955	34,010	137,018		205,297	82.1	%
Silicon Valley		20	2,251,021	65,594	—		199,952	95.3	%
Dallas		20	3,354,328	182,589	49,646		190,385	82.0	%
Phoenix		3	795,687	—	227,274		79,344	73.5	%
San Francisco		4	787,083	61,210	—		62,224	72.1	%
Atlanta		4	525,414	—	313,581		48,921	93.0	%
Los Angeles		4	818,479	—	—		42,932	86.1	%
Toronto	(6)	2	232,980	583,029	—		22,960	92.8	%
Boston		4	467,519	—	50,649		22,347	55.2	%
Houston		6	392,816	—	13,969		19,691	81.8	%
Austin		1	85,688	—	—		8,869	65.0	%
Miami		2	226,314	—	—		7,805	89.3	%
Portland		2	48,574	552,862	—		6,606	91.4	%
Minneapolis		1	328,765	—	—		5,798	100.0	%
Charlotte		3	95,499	—	—		4,696	88.0	%
North America Total		121	20,831,571	2,583,816	1,021,982		1,736,575	85.9	%

Europe
London, United Kingdom	(7)	16	1,456,352	136,921	99,175		210,569	87.5	%
Amsterdam, Netherlands	(8)	10	599,591	48,490	95,262		42,160	65.9	%
Dublin, Ireland	(8)	5	265,430	26,646	64,750		22,021	75.1	%
Frankfurt, Germany	(8)	4	222,261	185,814	—		24,231	82.6	%
Paris, France	(8)	4	185,994	96,402	—		7,086	100.0	%
Geneva, Switzerland	(8)	1	59,190	—	—		1,783	100.0	%
Manchester, England	(7)	1	38,016	—	—		1,815	100.0	%
Europe Total		41	2,826,835	494,273	259,187		309,665	82.6	%

Asia Pacific
Singapore	(9)	3	540,638	344,826	—		79,196	85.0	%
Sydney, Australia	(10)	3	225,728	88,629	—		19,848	67.4	%
Melbourne, Australia	(10)	2	146,570	—	—		18,489	85.8	%
Osaka, Japan	(11)	1	—	193,535	—		—	NA
Tokyo, Japan	(11)	1	—	406,664	—		—	NA
Asia Pacific Total		10	912,936	1,033,654	—		117,533	80.8	%

Held for Sale		12	1,377,405	—	—		35,979	100.0	%

Non-Data Center Properties		—	278,068	—	—		1,240	100.0	%

Managed Unconsolidated Joint Ventures
Northern Virginia		7	1,250,419	—	—		91,232	100.0	%
Hong Kong	(12)	1	182,488	—	3,812		17,422	76.3	%
Silicon Valley		4	326,305	—	—		13,318	100.0	%
Dallas		3	319,876	—	—		5,419	82.4	%
New York		1	108,336	—	—		3,460	100.0	%
		16	2,187,424	—	3,812		130,851	95.5	%

Non-Managed Unconsolidated Joint Ventures
São Paulo, Brazil	(13)	15	739,373	219,118	394,988		111,231	97.2	%
Seattle		2	451,369	—	—		61,267	97.3	%
Tokyo, Japan	(11)	2	430,277	—	—		36,321	93.8	%
Osaka, Japan	(11)	2	207,464	93,748	30,874		28,199	68.6	%
Fortaleza, Brazil	(13)	1	94,205	—	—		10,062	100.0	%
Rio De Janeiro, Brazil	(13)	2	72,442	—	26,781		9,621	100.0	%
Santiago, Chile		1	—	46,474	20,865		—	NA
		25	1,995,130	359,340	473,508		256,702	93.7	%

Total		225	30,409,369	4,471,083	1,758,490		2,588,545	86.8	%

(1)

Net rentable square feet at a building represents the current square feet at that building under lease as specified in the lease agreements plus management’s estimate of space available for lease. We estimate the total net rentable square feet available for lease based on a number of factors in addition to contractually leased square feet, including available power, required support space and common area. Net rentable square feet includes tenants’ proportional share of common areas but excludes space held for development.

Index to Financial Statements

(2)	Space under active development includes current base building and data center projects in progress.

(3)	Space held for development includes space held for future data center development, and excludes space under active development.

(4)	Annualized rent represents the monthly contractual rent (defined as cash base rent before abatements) under existing leases as of December 31, 2019 multiplied by 12.

(5)	Excludes space held for development and space under active development. We estimate the total square feet available for lease based on a number of factors in addition to contractually leased square feet, including available power, required support space and common area.

(6)	Rental amounts were calculated based on the exchange rate in effect on December 31, 2019 of $0.77 to 1.00 CAD.

(7)	Rental amounts were calculated based on the exchange rate in effect on December 31, 2019 of $1.33 to £1.00.

(8)	Rental amounts were calculated based on the exchange rate in effect on December 31, 2019 of $1.12 to €1.00.

(9)	Rental amounts were calculated based on the exchange rate in effect on December 31, 2019 of $0.74 to 1.00 SGD.

(10)	Rental amounts were calculated based on the exchange rate in effect on December 31, 2019 of $0.70 to 1.00 AUD.

(11)	Rental amounts were calculated based on the exchange rate in effect on December 31, 2019 of $0.01 to 1.00 JPY.

(12)	Rental amounts were calculated based on the exchange rate in effect on December 31, 2019 of $0.13 to 1.00 HKD.

(13)	Rental amounts were calculated based on the exchange rate in effect on December 31, 2019 of $0.25 to 1.00 BRL.

We have ground leases on Paul van Vlissingenstraat 16 (expires in 2054), Chemin de l’Epinglier 2 (expires in 2074), Clonshaugh Industrial Estate I and II (expires in 2981), Manchester Technopark (expires in 2125), 29A International Business Park (expires in 2038), Gyroscoopweg 2E-2F, which has a continuous ground lease and will be adjusted on January 1, 2042, and Naritaweg 52, which has a continuous ground lease. We have operating leases at 111 8th Avenue (2nd and 6th floors), 111 8th Avenue (3rd and 7th floors) and 410 Commerce Boulevard, which expire in June 2024, February 2022 and December 2026, respectively. The lease at 111 8th Avenue (2ndand 6th floors) has an option to extend the lease until June 2034 and the lease at 111 8th Avenue (3rd and 7th floors) has an option to extend the lease until February 2032. The lease at 410 Commerce Boulevard has no extension options. As part of the Telx Acquisition and European Portfolio Acquisition, leases relating to operating facilities, offices, and equipment under various lease agreements expired or will expire during the years ending December 2019 through June 2047.

We have a fully prepaid ground lease on Cateringweg 5 that expires in 2059. The ground lease at Naritaweg 52 has been prepaid through December 2036.

Index to Financial Statements

Customer Diversification

As of December 31, 2019, our portfolio was leased to over 2,000 companies, many of which are internationally recognized firms. The following table sets forth information regarding the 20 largest customers in our portfolio based on annualized rent as of December 31, 2019 (dollar amounts in thousands).


										Weighted
				Percentage						Average
			Total	of Net				Percentage		Remaining
		Number	Occupied	Rentable				of		Lease
		of	Square	Square		Annualized		Annualized		Term in
	Customer	Locations	Feet (1)(3)	Feet (3)		Rent (2)(3)		Rent		Months
1	Fortune 50 Software Company	19	2,088,316	9.6	%	$	174,871	8.0	%	8.9
2	IBM	27	1,021,071	4.7	%		146,219	6.7	%	3.8
3	Facebook, Inc.	17	1,044,542	4.8	%		134,692	6.1	%	5.0
4	Oracle America, Inc.	19	576,700	2.7	%		76,890	3.5	%	1.9
5	Fortune 25 Investment Grade-Rated Company	13	578,852	2.7	%		72,802	3.3	%	3.7
6	LinkedIn Corporation	7	510,785	2.4	%		63,487	2.9	%	4.9
7	Cyxtera Technologies, Inc. (4)	16	1,399,127	6.4	%		62,533	2.8	%	12.1
8	Equinix	21	959,049	4.4	%		59,689	2.7	%	9.3
9	Rackspace	14	614,247	2.8	%		56,118	2.6	%	8.1
10	Fortune 500 SaaS Provider	8	428,245	2.0	%		39,237	1.8	%	6.2
11	Comcast Corporation	25	182,647	0.8	%		35,767	1.6	%	6.0
12	JPMorgan Chase & Co.	16	268,443	1.2	%		35,587	1.6	%	2.3
13	DXC Technology Company (5)	11	229,644	1.1	%		31,466	1.4	%	3.5
14	CenturyLink, Inc.	84	426,810	2.0	%		27,583	1.3	%	6.0
15	China Telecommunications Corporation	9	153,156	0.7	%		27,094	1.2	%	4.4
16	Verizon	63	238,749	1.1	%		26,267	1.2	%	3.8
17	Morgan Stanley	12	173,502	0.8	%		25,354	1.2	%	3.5
18	Global Cloud Provider	14	330,084	1.5	%		24,764	1.1	%	1.6
19	Uber Technologies, Inc.	6	127,480	0.6	%		24,753	1.1	%	3.4
20	SunGard Availability Services LP	9	191,200	0.9	%		23,845	1.1	%	6.0
	Total / Weighted Average		11,542,649	53.2	%	$	1,169,018	53.2	%	6.6

Note: Our direct customers may be the entities named in the table above or their subsidiaries or affiliates.

(1)	Occupied square footage is defined as leases that commenced on or before December 31, 2019. For some of our properties, we calculate occupancy based on factors in addition to contractually leased square feet, including available power, required support space and common area.

(2)	Annualized rent represents the monthly contractual base rent (defined as cash base rent before abatements) under existing leases as of December 31, 2019 multiplied by 12.

(3)	Represents consolidated portfolio plus our managed portfolio of unconsolidated joint ventures based on our ownership percentage.

(4)	Represents leases with former CenturyLink, Inc. affiliates, which are our direct customers. Cyxtera Technologies, Inc. acquired the data center and colocation business, including such direct customers, of CenturyLink, Inc. in 2Q 2017.

(5)	Represents leases with former Hewlett Packard Enterprises affiliates, which are our direct customers. DXC Technology Company was formed in 2Q 2017 from the merger of Computer Sciences Corporation (CSC) and the Enterprise Services business of Hewlett Packard Enterprise.

Lease Distribution

The following table sets forth information relating to the distribution of leases in the properties in our portfolio, based on net rentable square feet (excluding approximately 4.5 million square feet of space under active development

Index to Financial Statements

and approximately 1.8 million square feet of space held for development at December 31, 2019) under lease as of December 31, 2019 (dollar amounts in thousands).


		Percentage
	Total Net	of Net				Percentage
	Rentable	Rentable				of
	Square	Square		Annualized		Annualized
Square Feet Under Lease	Feet(1)(3)	Feet(1)		Rent(2)(3)		Rent
Available	3,642,944	14.4	%		—	—
2,500 or less	1,660,325	6.6	%	$	340,387	15.5	%
2,501 - 10,000	2,632,273	10.4	%		320,229	14.6	%
10,001 - 20,000	5,888,474	23.2	%		723,644	33.0	%
20,001 - 40,000	4,500,657	17.8	%		490,805	22.4	%
40,001 - 100,000	3,695,855	14.6	%		214,640	9.7	%
Greater than 100,000	3,321,112	13.0	%		106,704	4.8	%
Portfolio Total	25,341,640	100.0	%	$	2,196,409	100.0	%

(1)

For some of our properties, we calculate square footage based on factors in addition to contractually leased square feet, including available power, required support space and common area. We estimate the total net rentable square feet available for lease based on a number of factors in addition to contractually leased square feet, including available power, required support space and common area.

(2)	Annualized rent represents the monthly contractual base rent (defined as cash base rent before abatements) under existing leases as of December 31, 2019 multiplied by 12.

(3)	Represents consolidated portfolio plus our managed portfolio of unconsolidated joint ventures based on our ownership percentage.

Index to Financial Statements

Lease Expirations

The following table sets forth a summary schedule of the lease expirations for leases in place as of December 31, 2019 plus available space for ten calendar years at the properties in our portfolio, excluding approximately 4.5 million square feet of space under active development and approximately 1.8 million square feet of space held for development at December 31, 2019. Unless otherwise stated in the footnotes to the table below, the information set forth in the table assumes that tenants exercise no renewal options and all early termination rights (dollar amounts in thousands).


										Annualized
		Percentage						Annualized		Rent Per
	Square	of Net				Percentage		Rent Per		Occupied
	Footage of	Rentable				of		Occupied		Square		Annualized
	Expiring	Square		Annualized		Annualized		Square		Foot at		Rent at
Year	Leases (1)(4)	Feet (4)		Rent (2)(4)		Rent (4)		Foot (4)		Expiration (4)		Expiration
Available	3,642,944	14.4	%
Month to Month (3)	150,863	0.6	%	$	36,486	1.7	%	$	242	$	242	$	36,486
2020	2,129,646	8.4	%		343,564	15.6	%		161		161		343,700
2021	2,905,739	11.5	%		348,046	15.9	%		120		123		356,320
2022	2,773,188	10.9	%		312,835	14.2	%		113		119		329,300
2023	1,970,062	7.8	%		215,012	9.8	%		109		115		227,504
2024	2,363,221	9.3	%		244,689	11.1	%		104		113		268,173
2025	2,079,914	8.2	%		197,594	9.0	%		95		105		219,344
2026	1,231,658	4.9	%		129,903	5.9	%		105		125		153,616
2027	554,668	2.2	%		51,226	2.3	%		92		111		61,534
2028	516,881	2.0	%		40,826	1.9	%		79		94		48,519
2029	1,003,075	4.0	%		66,924	3.1	%		67		83		83,355
Thereafter	4,019,781	15.8	%		209,304	9.5	%		52		70		280,599
Portfolio Total / Weighted Average	25,341,640	100.0	%	$	2,196,409	100.0	%	$	101	$	111	$	2,408,450

(1)

(2)	Annualized rent represents the monthly contractual base rent (defined as cash base rent before abatements) under existing leases as of December 31, 2019 multiplied by 12.

(3)	Includes leases, licenses and similar agreements that upon expiration have been automatically renewed on a month-to-month basis.

(4)	Represents consolidated portfolio plus our managed portfolio of unconsolidated joint ventures based on our ownership percentage.

Previous: Item 1B. UNRESOLVED STAFF COMMENTS · Next: Item 3. LEGAL PROCEEDINGS