Digital Realty Trust

Andy Power, who became CEO in January 2023, leads the executive team alongside CFO Matt Mercurio. Investment decisions are made by the executive committee, with capital allocation guided by a disciplined underwriting framework targeting a cost of capital advantage. The board includes independent directors with deep real estate and technology experience (per the firm's annual proxy).

The firm operates at the intersection of real estate and digital infrastructure. It owns data center properties but generates revenue through power and connectivity services, not just rent. Its interconnectivity platform, PlatformDIGITAL®, sets it apart from pure-play REITs, offering virtual cross-connects that lock in tenants (per the firm's 2023 10-K).

Digital Realty focuses on build-to-suit contracts with hyperscale tenants (AWS, Microsoft, Google) for large campuses, which reduces leasing risk. It also builds speculative capacity in multi-tenant colocation markets like London and Frankfurt, where demand from enterprise and financial customers supports pre-leasing of 60-75% before stabilization. The firm targets a 30% pre-tax return on total capital for new developments (per the firm's investor presentation, 2023).

The firm locks in long-term power purchase agreements (PPAs) with utilities and invests in on-site solar and fuel cells at many campuses. It also negotiates power costs as a pass-through to tenants in most leases, insulating margin from rate spikes. In high-growth markets like Northern Virginia and Silicon Valley, Digital Realty owns substations and switches to secure capacity ahead of peers (per the firm's sustainability report).

Digital Realty frequently forms joint ventures to recycle capital from stabilized assets. In 2023, it formed a $7 billion JV with Blackstone for new development. In 2024, it merged its Brookfield assets into the platform. These JVs allow the firm to earn management fees and retain upside while reducing on-balance-sheet risk. The firm also maintains an investment-grade credit rating (BBB+ from S&P) that supports access to cheap debt (per S&P, 2024).

The firm avoids owning data centers with single-tenant, speculative construction in tertiary markets where demand is thin. It avoids operating as a hyperscaler's captive developer by maintaining a diversified client base. It also does not invest in edge computing nodes below 1 MW unless tied to a specific enterprise contract, preferring core and metro facilities (per the firm's investor presentations).

PlatformDIGITAL® is a software layer that enables customers to manage virtual cross-connects, order bandwidth from dozens of carriers, and monitor power usage via a dashboard. It acts as a 'sticky' tool — once a tenant configures a network on PlatformDIGITAL®, migrating to a competitor is costly. The firm claims the platform reached over 1,900 networks and 370 cloud providers in 2023, making it the largest neutral interconnection fabric (per the firm's 2023 annual report).