Equinix recently announced the renewal of an agreement with Digital Realty Trust for five data center leases.
The facilities are located in Chicago, Dallas, Los Angeles, Miami and Washington D.C., five of the top data center real estate markets in the U.S.
Equinix data centers provide customers with scalable capabilities to reach target markets, as well as breadth of service spanning 31 key markets in 15 countries, according to the company’s website. The Equinix network includes connections with 4,000 customers and partners that make up the company’s Internet business exchange data center system.
The lease agreement includes initial terms lasting 15 years from the current lease expiration date and two 10-year renewal plans at pre-negotiated rental rates. The data center finance plan was negotiated at current market rates as part of the agreement.
Howard Horowitz, Equinix senior vice president of global real estate, said the agreement with Digital Realty Trust is an important step in the management of the company’s real estate portfolio. Equinix is looking forward to increased operational flexibility and consistency in their facility assets.
“We have a long-standing and productive relationship with Digital Realty and are pleased to have negotiated mutually beneficial lease renewal agreements over effectively a 35-year period on these five assets at rates in-line with our expectations,” Horowitz said.
The five recently renewed leases with Equinix are a key subset of Digital Realty’s 127 properties in North America, Asia, Australia and Europe.
David Caron, Digital Reality senior vice president of portfolio management, said the cash rental rate in the lease agreement with Equinix gives Digital Realty representatives a real-time view on current data center pricing.
“These early renewals represent a win-win for both companies, as they provide long-term operational certainty to a strategic customer, while simultaneously unlocking a portion of the embedded rent growth within our portfolio,” Caron said.