Digital Realty Trust, Inc.

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Bullish +75

Digital Realty Announces Purchase of Blackstone Interest in Three Northern Virginia Data Centers - GlobeNewswire

📈 Digital Realty agreed to purchase a $7.8 billion stake in three Northern Virginia data centers from Blackstone for a total consideration of $3.5 billion.

💰 The deal includes $1.2 billion in cash and $2.3 billion in DLR shares, valuing the assets at over 6.5% stabilized capitalization rate.

🏗️ The portfolio consists of 288 megawatts of IT capacity across two Manassas sites and one Sterling site, all currently 100% leased to hyperscale customers.

📅 Closing is scheduled for June 30, 2026, with assets expected to stabilize in the first half of 2027 and 2028.

🤝 Digital Realty will acquire an 80% interest in the Manassas centers and a 50% interest in the Sterling center at full share value.

📜 Assets are secured by 15-year leases with investment-grade customers featuring 3.6% annual rent escalators.

💵 CFO Matt Mercier projects the transaction will be accretive to Core FFO per share in 2027 and 2028 upon stabilization.

🚀 The acquisition extends Digital Realty's growth runway and pipeline within its strategic private capital platform.

🌍 Northern Virginia remains the world's largest data center market, supported by strong demand for digital infrastructure.

📊 The deal enhances portfolio quality with newly constructed assets in a top-tier location.

Bullish Signals
  • Digital Realty is acquiring high-quality, fully leased hyperscale assets in the world's largest data center market (Northern Virginia).
  • The portfolio comprises 288 megawatts of IT capacity currently 100% leased to investment-grade hyperscale customers.
  • Leases are structured with 15-year terms and 3.6% annual rent escalators, providing long-term revenue visibility.
  • Management expects the transaction to be accretive to Core FFO per share in both 2027 and 2028 once development completes.
  • The acquisition extends Digital Realty's growth runway and pipeline for its strategic private capital platform.
  • Digital Realty is increasing ownership in new, high-quality assets developed through a successful partnership with Blackstone.
  • The deal reflects strong demand for digital infrastructure even stronger than when the joint venture was established in 2023.
Full Analysis
Digital Realty (NYSE: DLR) announced on June 29, 2026, that it has agreed to purchase a stake in three fully leased data centers located in Northern Virginia from Blackstone-affiliated funds. The portfolio includes two facilities in Manassas and one in Sterling, collectively offering 288 megawatts of IT capacity. The total gross value of the assets is $7.8 billion, reflecting an expected initial stabilized capitalization rate of over 6.5%. Digital Realty will pay a total consideration of $3.5 billion for Blackstone's blended 64% equity interest, comprising $1.2 billion in cash and $2.3 billion in DLR shares based on the closing stock price. The transaction involves Digital Realty acquiring an 80% interest in the two Manassas centers and a 50% interest in the Sterling center at 100% share, including assumed debt and remaining capital expenditures to complete development. All three facilities are currently 100% leased to distinct investment-grade hyperscale customers under 15-year leases featuring 3.6% annual rent escalators. The deal is expected to close on June 30, 2026, subject to customary closing conditions, and will significantly increase Digital Realty's exposure to new capacity in the world's largest data center market. Digital Realty executives stated that the acquisition is expected to be accretive to Core Funds From Operations (FFO) per share in both 2027 and 2028 once development completes and rents commence. The assets are anticipated to stabilize in the first half of 2027 and 2028, respectively. This strategic move extends Digital Realty's growth runway and pipeline within its strategic private capital platform, leveraging long-term contracts with premier customers in a high-demand market. The press release concludes with standard forward-looking statements regarding risks associated with the acquisition, development completion, and stabilization timelines. It also notes that Digital Realty will release its Second Quarter 2026 earnings shortly after the closing date. The company highlights its global footprint of over 300 facilities supporting cloud, digital transformation, and emerging technologies like artificial intelligence.