Digital Realty Buys No. Virginia Centers

Northern Virginia continues to be a red-hot market for Internet data centers, with Digital Realty Trust announcing a major deal Thursday, just days after Equinix unveiled expansion plans in the area. Digital Realty (DLR) said Thursday that it has acquired three properties in Ashburn, Va. for $62.5 million. The deal includes 43881, 43831 and 43791 Devin Shafron Drive, three single-story buildings spanning 432,000 square feet that were previously known as the Loudoun Exchange. About 40 percent of the space is leased, with tenants including Amazon.com and a major aeronautics company. The remaining 265,000 square feet will be held for redevelopment.

Last month Digital Realty bought 44470 Chillum Place, a 95,400 square feet fully-leased data center in Ashburn, Va. previously owned by DuPont Fabros, the Washington, D.C.-based investment firm that own multiple data centers. The Loudoun Exchange properties were developed by Genisus. The deals give Digital Realty 10 buildings totaling approximately 770,000 square feet in northern Virginia.

"(Northern Virginia) is one of the top markets for data center space in the country with strong demand coming from government, Internet enterprise, system integrators and other corporate customers," said Michael Foust, CEO of Digital Realty Trust, said in a press release.

"We are well underway with our redevelopment and master planning of the property," said Chris Crosby, SVP of Sales and Technical Services. "We will implement the first phase of our plan, delivering over 2.2MW of UPS load in new Turn-Key Datacenter(TM) space later in 2007 to serve our current customer demand. In addition to the Turn-Key Datacenter space, we are also excited about our ability to offer a large, build-to-suit single tenant datacenter solution."

The deal was welcomed by local officials. "The infrastructure, the fiber, the physical space and most importantly the people with the knowledge and skill to operate data centers are well established in Loudoun County," said Kirby Bowers, County Administrator for Loudoun County Government. "Access to the mission critical services that these data centers offer and their proximity to major Internet switching points are key differentiators of having operations in Loudoun County. This significant investment is part of a growing cluster of more than a dozen such datacenters in Loudoun County, beginning in the late nineties, establishing Loudoun as one of the world's premier datacenter markets."

Other properties acquired by the Digital Realty Trust in the Northern Virginia market include a 71,000 square foot fully leased facility in Herndon; a 135,000 square foot facility in Sterling that was added to its inventory of space held for redevelopment and subsequently 100% leased in the first quarter of 2007; 19,000 square feet of datacenter space in Reston; and 17,000 square feet of datacenter space in Vienna.