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Investments in Properties

6 Months Ended

Jun. 30, 2025

Investments in Properties

Investments in Properties

2. Investments in Properties

A summary of our investments in properties is below (in thousands):


Property Type		As of June 30, 2025				As of December 31, 2024
Land		$	1,192,039			$	1,108,251
Acquired ground lease			97				86
Buildings and improvements			27,718,850				25,567,155
Tenant improvements			925,232				883,502
			29,836,218				27,558,994
Accumulated depreciation and amortization			(9,341,719)				(8,641,331)
Investments in operating properties, net			20,494,499				18,917,663
Construction in progress and space held for development			5,080,701				5,164,334
Land held for future development			73,665				38,785
Investments in properties, net		$	25,648,865			$	24,120,782

Acquisitions

During the quarter, we closed on land acquisitions for approximately $182 million in the aggregate.

Contributions

During the first half of 2025, the Company launched its first U.S. Hyperscale Data Center Fund (the “Fund”), successfully raising more than $3 billion of equity commitments to date. Fund commitments represent a 40% to 80% ownership interest in each individual asset, while the Company will maintain the remaining 20% to 60% stake in the assets and less than a 2% direct interest in the Fund. The initial portfolio includes five operating data centers plus three land sites with access to power for data center development. In May 2025, we received approximately $937 million of gross proceeds from the contribution of operating data centers and development projects to the Fund, recognized a gain on disposition of approximately $873 million, and recognized an investment in the assets of $661 million. The Company will serve as general partner, maintaining operational and management responsibilities for the assets, however, certain governance rights are granted to the limited partners. As such, we concluded we do not own a controlling interest and account for our interest in the assets under the equity method of accounting. These real estate assets were previously classified as held for sale and contribution. Additionally, as of June 30, 2025, one additional development project was classified within Assets held for sale and contribution on our condensed consolidated balance sheet as it is probable it will be contributed to the fund within one year. The disposition of a portion of our interest in the remaining development project met the criteria under ASC 360 for the assets to qualify as held for sale and contribution. However, the operations are not classified as discontinued operations as a result of our continuing interest in the assets. This development project was not representative of a significant component of our portfolio, nor will the contribution represent a significant shift in our strategy.

On April 3, 2025, we received approximately $77 million of gross proceeds from the contribution of our data centers to the joint venture with Blackstone. As a result of transferring control, we derecognized the data centers and recognized a gain on disposition of approximately $58 million.

As of June 30, 2025, real estate assets, including those mentioned above, that qualified as held for sale had an aggregate carrying value of $140.0 million within total assets and $1.1 million within total liabilities and are shown within Assets held for sale and contribution and Obligations associated with assets held for sale and contribution, respectively, on the

condensed consolidated balance sheets. Subsequent to quarter end, Digital Realty sold a non-core data center in the Atlanta metro area for gross proceeds of $66 million.