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Equity Method Investments | 9 Months Ended
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Sep. 30, 2021
Equity Method Investments and Joint Ventures [Abstract] |
Equity Method Investments | Equity Method Investments The following table summarizes our equity method investments (in thousands), which were included in other assets on the condensed consolidated balance sheets:
Investee |  | Ownership Percentage |  | September 30, 2021 |  | December 31, 2020
EMEA 1 Joint Venture with GIC |  | 20% |  | $ | 114,836 |  |  | $ | 101,892 |
EMEA 2 Joint Venture with GIC |  | 20% |  | 30,386 |  |  | — |
Asia-Pacific 1 Joint Venture with GIC |  | 20% |  | 56,566 |  |  | 43,432 |
Other |  | Various |  | 18,790 |  |  | 17,747 |
Total |  |  |  | $ | 220,578 |  |  | $ | 163,071 |
Non - Variable Interest Entity (VIE) Joint Venture EMEA 1 Joint Venture In 2019, we entered into a joint venture in the form of a limited liability partnership with GIC (the "EMEA 1 Joint Venture"), to develop and operate xScale data centers in Europe. The EMEA 1 Joint Venture is not a variable interest entity ("VIE") given that both equity investors' interests have the characteristics of a controlling financial interest and it is sufficiently capitalized to sustain its operations, requiring additional funding from its partners only when expanding operations. Our share of income and losses of equity method investments from this joint venture was insignificant for the three and nine months ended September 30, 2021 and 2020 and was included in other income (expense) on the condensed consolidated statement of operations. We committed to make future equity contributions to the EMEA 1 Joint Venture for funding its future development. As of September 30, 2021, we had future equity contribution commitments of $43.6 million. VIE Joint Ventures Asia-Pacific 1 and EMEA 2 Joint Ventures In 2020, we entered into a second joint venture in the form of a limited liability partnership with GIC (the "Asia-Pacific 1 Joint Venture") to develop and operate xScale data centers in Asia-Pacific. In 2021, we entered into another joint venture in the form of a limited liability partnership with GIC (the "EMEA 2 Joint Venture") to develop and operate additional xScale data centers in Europe and the Americas (see Note 5 above). For both the Asia-Pacific 1 Joint Venture and the EMEA 2 Joint Venture, we provide certain management services to their operations and earn fees for the performance of such services. Both joint ventures do not have sufficient funds from operations to be self-sustaining, thus are considered VIEs. The power to direct the activities of these joint ventures that most significantly impact economic performance is shared equally between GIC and us. These activities include data center construction and operations, sales and marketing, financing, and real estate purchases or sales. Decisions about these activities require the consent of both GIC and us. We concluded that neither party is deemed to have predominant control over the Asia-Pacific 1 Joint Venture and EMEA 2 Joint Venture and neither party is considered to be the primary beneficiary. During the three and nine months ended September 30, 2021, our share of income and losses of equity method investments from these joint ventures was insignificant both individually and in aggregate, and was included in other income (expense) on the condensed consolidated statement of operations. The following table summarizes our maximum exposure to loss related to the Asia-Pacific 1 Joint Venture and EMEA 2 Joint Venture as of September 30, 2021 (in thousands):
|  | Asia-Pacific 1 Joint Venture |  | EMEA 2 Joint Venture
Equity Investment |  | $ | 56,566 |  |  | $ | 30,386 |
Outstanding Receivables |  | 3,844 |  |  | 11,451 |
Future Equity Contribution Commitments 1 |  | 1,098 |  |  | 57,662 |
Maximum Future Payments under Debt Guarantees 2 |  | N/A 3 |  | 30,389 |
Total |  | $ | 61,508 |  |  | $ | 129,888 |
(1)The joint ventures' partners are required to make additional equity contributions proportionately upon certain occurrences, such as a shortfall in capital necessary to complete certain construction phases or make interest payments on their outstanding debt. (2)In connection with our 20% equity investment in the EMEA 2 Joint Venture, we provided the lenders with our guarantees covering 20% of all payments of principal and interest due under EMEA 2 Joint Venture's credit facility agreements (see Note 11). (3)The Asia-Pacific 1 Joint Venture’s debt is secured by the net assets of the Asia-Pacific 1 Joint Venture without recourse to its partners. Other Related Party Transactions We have lease arrangements and provide various services to the EMEA 1 Joint Venture, Asia-Pacific 1 Joint Venture and EMEA 2 Joint Venture (the "Joint Ventures") through multiple agreements, including sales and marketing, development management, facilities management, and asset management services. These transactions are generally considered to have been negotiated at arm's length. The following table presents the revenues and expenses from these arrangements with the Joint Ventures in our condensed consolidated statements of operations (in thousands):
|  |  |  | Three Months Ended September 30, |  | Nine Months Ended September 30,
Related Party | Location of Revenues (Expenses) |  | 2021 |  | 2020 |  | 2021 |  | 2020
EMEA 1 Joint Venture |  | Revenues |  | $ | 11,698 |  |  | $ | 6,061 |  |  | $ | 30,548 |  |  | $ | 14,609 |
EMEA 1 Joint Venture |  | Expenses (1) |  | (4,006) |  |  | (3,369) |  |  | (12,786) |  |  | (10,560) |
Asia-Pacific 1 Joint Venture |  | Revenues |  | 4,044 |  |  | — |  |  | 18,489 |  |  | — |
EMEA 2 Joint Venture |  | Revenues |  | 884 |  |  | — |  |  | 884 |  |  | — |
(1)We have a sub-lease agreement with the EMEA 1 Joint Venture to sub-lease a portion of London ("LD") 10-2 data center or former LD10 data center, for a total of 15 years. Balances primarily consist of rent expenses for the LD10-2 data center. The following table presents the assets and liabilities from related party transactions with the Joint Ventures in our condensed consolidated balance sheets (in thousands):
Related Party |  | Balance Sheet Line Item |  | September 30, 2021 |  | December 31, 2020
EMEA 1 Joint Venture |  | Receivables (1) |  | $ | 35,466 |  |  | $ | 6,459 |
| Contract Assets (2) |  | 37,322 |  |  | 5,614 |
| Finance Lease R ight of Use Assets (3) |  | 120,616 |  |  | 127,197 |
| Other Liabilities and Payables (4) |  | 18,541 |  |  | 17,646 |
| Finance Lease R ight of Use Liabilities (3) |  | 126,080 |  |  | 130,756 |
Asia- Pacific 1 Joint Venture |  | Receivables (1) |  | 3,844 |  |  | 16,936 |
EMEA 2 Joint Venture |  | Receivables (1) |  | 11,451 |  |  | — |
(1)Balances primarily consist of amounts due under commercial service agreements. (2)A portion of the contract asset balance relates to commitments to the EMEA 1 Joint Venture to complete a residual portion of the PA9 data center sold to the EMEA 1 Joint Venture, which is reimbursable in full upon completion. The remaining balance represents contract assets recorded under our commercial service agreements. (3)Balances pertain to the LD10-2 data center sub-lease as described above. (4)We have an agreement to lease to the EMEA 1 Joint Venture a portion of land for the Frankfurt 9 xScale data center and a new building that is under construction on the land. As of September 30, 2021, the lease has not commenced yet. Balance primarily consists of liabilities recorded in connection with the construction of the Frankfurt 9 xScale data center. The remaining balance pertains to meter and power charge accruals under the LD 10-2 sublease. We received contingent consideration from the sales of xScale data centers to the EMEA 1 Joint Venture, which become receivable upon completion of certain performance milestones, primarily contingent on the local regulatory approvals for certain sites. The contingent consideration are considered derivatives and are remeasured at fair value each reporting period using inputs such as probabilities of payment, discount rates, foreign currency forward rates and projected payment dates. The fair value measurements were based on significant inputs that are not observable in the market and thus represent Level 3 measurements. The contingencies were partially met during the nine months ended September 30, 2021 upon achieving the performance milestone for one of the sites. As of September 30, 2021 and December 31, 2020, the total fair value of the remaining contingent consideration was $15.2 million and $44.2 million, respectively, which was included in other current assets on the condensed consolidated balance sheets. Changes in the fair value of the contingent consideration were recorded in gain (loss) on asset sales on the condensed consolidated statement of operations.

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- Definition The entire disclosure for equity method investments and joint ventures. Equity method investments are investments that give the investor the ability to exercise significant influence over the operating and financial policies of an investee. Joint ventures are entities owned and operated by a small group of businesses as a separate and specific business or project for the mutual benefit of the members of the group. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 323 -URI http://asc.fasb.org/topic&trid=2196965 + Details
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