Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | Apr. 29, 2020 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Mar. 31, 2020 | |
Entity File Number | 001-34877 | |
Entity Registrant Name | CoreSite Realty Corp | |
Entity Incorporation, State or Country Code | MD | |
Entity Tax Identification Number | 27-1925611 | |
Entity Address, Address Line One | 1001 17th Street, SuiteĀ 500 | |
Entity Address, City or Town | Denver | |
Entity Address, State or Province | CO | |
Entity Address, Postal Zip Code | 80202 | |
City Area Code | 866 | |
Local Phone Number | 777-2673 | |
Title of 12(b) Security | Common Stock, $0.01 par value per share | |
Trading Symbol | COR | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 37,903,353 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Entity Central Index Key | 0001490892 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Investments in real estate: | ||
Land | $ 94,593 | $ 94,593 |
Buildings and improvements | 2,015,530 | 1,989,731 |
Total investments in real estate | 2,110,123 | 2,084,324 |
Less: Accumulated depreciation and amortization | (756,025) | (720,498) |
Net investment in operating properties | 1,354,098 | 1,363,826 |
Construction in progress | 437,794 | 394,474 |
Net investments in real estate | 1,791,892 | 1,758,300 |
Operating lease right-of-use assets, net | 175,999 | 172,976 |
Cash and cash equivalents | 3,307 | 3,048 |
Accounts and other receivables, net of allowance for doubtful accounts of $904 and $371 as of March 31, 2020, and December 31, 2019, respectively | 24,260 | 21,008 |
Lease intangibles, net of accumulated amortization of $4,231 and $4,022 as of March 31, 2020, and December 31, 2019, respectively | 3,600 | 3,939 |
Goodwill | 40,646 | 40,646 |
Other assets, net | 104,555 | 101,082 |
Total assets | 2,144,259 | 2,100,999 |
Liabilities: | ||
Debt, net of unamortized deferred financing costs of $8,493 and $9,098 as of March 31, 20120 and December 31, 2019, respectively | 1,572,007 | 1,478,402 |
Operating lease liabilities | 190,759 | 187,443 |
Accounts payable and accrued expenses | 102,148 | 123,304 |
Accrued dividends and distributions | 61,637 | 62,332 |
Acquired below-market lease contracts, net of accumulated amortization of $1,511 and $3,840 as of December 31, 2019, and December 31, 2018, respectively | 2,462 | 2,511 |
Unearned revenue, prepaid rent and other liabilities | 50,798 | 33,119 |
Total liabilities | 1,979,811 | 1,887,111 |
Stockholders' equity: | ||
Common Stock, par value $0.01, 100,000,000 shares authorized and 37,905,933 and 36,708,691 shares issued and outstanding at March 31, 2020, and December 31, 2019, respectively | 374 | 373 |
Additional paid-in capital | 516,133 | 512,324 |
Accumulated other comprehensive loss | (19,158) | (6,026) |
Distributions in excess of net income | (376,835) | (348,509) |
Total stockholders' equity | 120,514 | 158,162 |
Noncontrolling interests | 43,934 | 55,726 |
Total equity | 164,448 | 213,888 |
Total liabilities and equity | $ 2,144,259 | $ 2,100,999 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Allowance for doubtful accounts (in dollars) | $ 904 | $ 371 |
Accumulated amortization, lease intangibles (in dollars) | 4,231 | 4,022 |
Deferred financing costs - revolving credit facility | 8,493 | 9,098 |
Accumulated amortization of below-market lease | $ 1,535 | $ 1,511 |
Common Stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common Stock, shares issued | 37,905,933 | 37,701,042 |
Common Stock, shares outstanding | 37,905,933 | 37,701,042 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Data center revenue: | ||
Interconnection revenue | $ 20,085 | $ 18,416 |
Total operating revenues | 147,362 | 138,895 |
Operating expenses: | ||
Property operating and maintenance | 40,183 | 38,110 |
Real estate taxes and insurance | 6,190 | 6,196 |
Depreciation and amortization | 40,991 | 35,646 |
Sales and marketing | 6,144 | 5,652 |
General and administrative | 11,267 | 10,170 |
Rent | 8,399 | 7,688 |
Total operating expenses | 113,174 | 103,462 |
Operating income | 34,188 | 35,433 |
Interest expense | (11,183) | (9,498) |
Income before income taxes | 23,005 | 25,935 |
Income tax (expense) benefit | (17) | (30) |
Net income | 22,988 | 25,905 |
Net income attributable to noncontrolling interests | 5,140 | 6,244 |
Net income attributable to common shares | $ 17,848 | $ 19,661 |
Net income per share attributable to common shares: | ||
Basic | $ 0.48 | $ 0.54 |
Diluted | $ 0.48 | $ 0.54 |
Weighted average common shares outstanding | ||
Basic | 37,335,892 | 36,347,781 |
Diluted | 37,504,349 | 36,547,065 |
Rental, power, and related revenue | ||
Data center revenue: | ||
Rental revenue | $ 124,505 | $ 117,853 |
Office, light-industrial and other revenue | ||
Data center revenue: | ||
Rental revenue | $ 2,772 | $ 2,626 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||
Net income | $ 22,988 | $ 25,905 |
Other comprehensive (loss) income: | ||
Unrealized (loss) gain on derivative contracts | (17,028) | (4,466) |
Reclassification of other comprehensive income (loss) to interest expense | 114 | (198) |
Comprehensive income | 6,074 | 21,241 |
Comprehensive income attributable to noncontrolling interests | 1,358 | 5,120 |
Comprehensive income attributable to CoreSite Realty Corporation | $ 4,716 | $ 16,121 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Thousands | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Distributions in Excess of Net Income | Total Stockholders' Equity | Noncontrolling Interests | Total |
Balance at Dec. 31, 2018 | $ 363 | $ 491,314 | $ (2,193) | $ (246,929) | $ 242,555 | $ 92,078 | $ 334,633 |
Balance (in shares) at Dec. 31, 2018 | 36,708,691 | ||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Issuance of stock awards, net of forfeitures (in shares) | 192,009 | ||||||
Exercise of stock options | 17 | 17 | 17 | ||||
Exercise of stock options (in shares) | 1,129 | ||||||
Share-based compensation | $ 1 | 3,592 | 3,593 | 3,593 | |||
Dividends and distributions | (40,581) | (40,581) | (12,733) | (53,314) | |||
Net income | 19,661 | 19,661 | 6,244 | 25,905 | |||
Other comprehensive income (loss) | (3,540) | (3,540) | (1,124) | (4,664) | |||
Balance at Mar. 31, 2019 | $ 364 | 494,923 | (5,733) | (267,849) | 221,705 | 84,465 | 306,170 |
Balance (in shares) at Mar. 31, 2019 | 36,901,829 | ||||||
Balance at Dec. 31, 2019 | $ 373 | 512,324 | (6,026) | (348,509) | 158,162 | 55,726 | 213,888 |
Balance (in shares) at Dec. 31, 2019 | 37,701,042 | ||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Redemption of noncontrolling interests | 11 | 11 | (11) | ||||
Redemption of noncontrolling interests (in shares) | 2,140 | ||||||
Issuance of stock awards, net of forfeitures (in shares) | 199,541 | ||||||
Exercise of stock options | 73 | 73 | 73 | ||||
Exercise of stock options (in shares) | 3,210 | ||||||
Share-based compensation | $ 1 | 3,725 | 3,726 | 3,726 | |||
Dividends and distributions | (46,174) | (46,174) | (13,139) | (59,313) | |||
Net income | 17,848 | 17,848 | 5,140 | 22,988 | |||
Other comprehensive income (loss) | (13,132) | (13,132) | (3,782) | (16,914) | |||
Balance at Mar. 31, 2020 | $ 374 | $ 516,133 | $ (19,158) | $ (376,835) | $ 120,514 | $ 43,934 | $ 164,448 |
Balance (in shares) at Mar. 31, 2020 | 37,905,933 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net income | $ 22,988 | $ 25,905 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 40,991 | 35,646 |
Amortization of above/below market leases | (34) | (86) |
Amortization of deferred financing costs and hedge amortization | 1,029 | 611 |
Share-based compensation | 3,482 | 3,432 |
Bad debt expense (recovery) | 700 | (27) |
Changes in operating assets and liabilities: | ||
Accounts receivable | (3,952) | (7,658) |
Deferred rent receivable | (496) | 1,036 |
Deferred leasing costs | (6,189) | (2,694) |
Other assets | (2,408) | (4,519) |
Accounts payable and accrued expenses | (2,579) | 2,757 |
Unearned revenue, prepaid rent and other liabilities | 726 | 857 |
Operating leases | 296 | 643 |
Net cash provided by operating activities | 54,554 | 55,903 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Tenant improvements | (1,329) | (1,046) |
Real estate improvements | (85,840) | (80,795) |
Net cash used in investing activities | (87,169) | (81,841) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from exercise of stock options | 73 | 17 |
Proceeds from revolving credit facility | 107,500 | 88,000 |
Payments on revolving credit facility | (14,500) | (8,500) |
Payments of loan fees and costs | (191) | |
Dividends and distributions | (60,008) | (53,884) |
Net cash provided by (used in) financing activities | 32,874 | 25,633 |
Net change in cash and cash equivalents | 259 | (305) |
Cash and cash equivalents, beginning of period | 3,048 | 2,599 |
Cash and cash equivalents, end of period | 3,307 | 2,294 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | ||
Cash paid for interest, net of capitalized amounts | 14,670 | 6,350 |
Cash paid for operating lease liabilities | 6,626 | 6,071 |
NON-CASH INVESTING AND FINANCING ACTIVITY | ||
Construction costs payable capitalized to real estate | 46,739 | 66,123 |
Accrual of dividends and distributions | 61,637 | $ 55,109 |
NON-CASH OPERATING ACTIVITY | ||
Lease liabilities arising from obtaining right-of-use assets | $ 7,646 |
Organization and Description of
Organization and Description of Business | 3 Months Ended |
Mar. 31, 2020 | |
Organization and Description of Business | |
Organization and Description of Business | 1. Organization and Description of Business ā CoreSite Realty Corporation (the āCompany,ā āwe,ā āus,ā or āourā) was organized in the State of Maryland on February 17, 2010, and is a fully-integrated, self-administered, and self-managed real estate investment trust (āREITā). Through our controlling interest in CoreSite, L.P. (our āOperating Partnershipā), we are engaged in the business of owning, acquiring, constructing and operating data centers. As of March 31, 2020, the Company owned a 77.6% common interest in our Operating Partnership, and affiliates of The Carlyle Group and others owned a 22.4% interest in our Operating Partnership. See additional discussion in Note 10, Noncontrolling Interests ā Operating Partnership. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2020 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies ā Principles of Consolidation and Basis of Presentation ā The accompanying unaudited condensed consolidated financial statements have been prepared by our management in accordance with U.S. generally accepted accounting principles (āGAAPā) for interim financial information and in compliance with the rules and regulations of the U.S. Securities and Exchange Commission. Accordingly, these unaudited condensed consolidated financial statements do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of our management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. The results of operations for the three months ended March 31, 2020, are not necessarily indicative of the expected results for the year ending December 31, 2020. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K ā Our Operating Partnership meets the definition and criteria of a variable interest entity (āVIEā) and we are the primary beneficiary of the VIE. Our sole significant asset is the investment in our Operating Partnership, and consequently, substantially all of our assets and liabilities represent those assets and liabilities of our Operating Partnership. Our debt is an obligation of our Operating Partnership where the creditors also have recourse against the credit of the Company. Intercompany balances and transactions have been eliminated upon consolidation. ā Recently Adopted Accounting Pronouncements ā Fair Value Measurement ā In August 2018, the Financial Accounting Standards Board (āFASBā) issued guidance codified in Accounting Standards Update (āASUā) 2018-13, Fair Value Measurement Intangibles ā Goodwill and Other ā Internal-Use Software ā In August 2018, the FASB issued guidance codified in ASU 2018-15, Intangibles ā Goodwill and Other ā Internal-Use Software Financial Instruments ā Credit Losses In June 2016, the FASB issued guidance codified in ASU 2016-13, Financial Instruments ā Credit Losses Codification Improvements to Topic 326, Financial Instruments ā Credit Losses Recent Accounting Pronouncements Not Yet Adopted ā Reference Rate Reform ā In March 2020, the FASB issued guidance codified in ASU 2020-04, Reference Rate Reform ā We determined that all other recently issued accounting pronouncements will not have a material impact on our condensed consolidated financial statements or do not apply to our operations. Use of Estimates ā The preparation of these unaudited condensed consolidated financial statements, in conformity with GAAP, requires our management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingencies at the date of the unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. We evaluate our estimates, including those related to assessing our standalone selling prices, performance-based equity compensation plans and the carrying values of our real estate properties, goodwill, and accrued liabilities. We base our estimates on historical experience, current market conditions, and various other assumptions that we believe to be reasonable under the circumstances. Actual results may vary from those estimates and those estimates could vary under different assumptions or conditions. ā Investments in Real Estate ā Real estate investments are carried at cost less accumulated depreciation and amortization. The cost of real estate includes the purchase price of property and leasehold improvements. Expenditures for maintenance and repairs are expensed as incurred. Significant renovations and betterments that extend the economic useful lives of assets are capitalized. During land development and construction periods, we capitalize construction costs, legal fees, financing costs, real estate taxes and insurance, rent expense and internal costs of personnel performing development, if such costs are incremental and identifiable to a specific development project. Capitalization of costs begins upon commencement of development efforts and ceases when the project is ready for its intended use and held available for occupancy. Interest is capitalized during the period of development based upon applying the weighted-average borrowing rate to the actual development costs expended. Capitalized interest costs were $3.5 million and $2.6 million for the three months ended March 31, 2020, and 2019, respectively. ā Depreciation and amortization are calculated using the straight-line method over the following useful lives of the assets: ā ā ā ā Buildings 27 to 40 years Building improvements ā 1 to 10 years Leasehold improvements ā The shorter of the lease term or useful life of the asset ā Depreciation expense was $36.9 million and $32.2 million for the three months ended March 31, 2020, and 2019, respectively. ā Acquisition of Investment in Real Estate ā When accounting for business combinations and asset acquisitions, the fair value of the real estate acquired is allocated to the acquired tangible assets, consisting primarily of land, building and building improvements, and identified intangible assets and liabilities, consisting of the value of above-market and below-market leases, value of in-place leases and the value of customer relationships. The primary difference between business combinations and asset acquisitions is that asset acquisitions require cost accumulation and allocation at a relative fair value. Acquisition costs are capitalized for asset acquisitions and are expensed for business combinations. ā The fair value of the land and building of an acquired property is determined by valuing the property as if it were vacant, and the āas-if-vacantā fair value is then allocated to land and building based on management's determination of the fair values of these assets. Management determines the as-if-vacant fair value of a property using methods similar to those used by independent appraisers. Factors considered by management in performing these analyses include an estimate of carrying costs during the expected lease-up periods considering current market conditions and costs to execute similar leases. ā The fair value of intangibles related to in-place leases includes the value of lease intangibles for above-market and below-market leases, lease origination costs, and customer relationships, determined on a lease-by-lease basis. Above-market and below-market leases are valued based on the present value (using an interest rate which reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to the in-place leases and (ii) management's estimate of market lease rates for the corresponding in-place leases, measured over a period equal to the remaining noncancelable term of the lease and, for below-market leases, over a time period equal to the initial term plus any below-market fixed rate renewal periods. Lease origination costs include estimates of costs avoided associated with leasing the property, including tenant allowances and improvements and leasing commissions. Customer relationship intangibles relate to the additional revenue opportunities expected to be generated through rental services, interconnection services, and utility services to be provided to the in-place lease tenants. ā The capitalized values for above and below-market lease intangibles, lease origination costs, and customer relationships are amortized over the term of the underlying leases or the expected customer relationship. Amortization related to above-market and below-market leases where the Company is the lessor is recorded as either a reduction of or an increase to rental revenue, amortization related to above-market and below-market leases where the Company is the lessee is recorded as either a reduction of or an increase to rent expense. If a lease is terminated prior to its stated expiration, all unamortized amounts relating to that lease are written off. ā The carrying value of intangible assets is reviewed for impairment in connection with its respective asset group whenever events or changes in circumstances indicate that the asset group may not be recoverable. An impairment loss is recognized if the carrying amount of the asset group is not recoverable and its carrying amount exceeds its estimated fair value. No impairment loss related to these intangible assets was recognized for the three months ended March 31, 2020, or 2019. ā The excess of the cost of an acquired business over the net of the amounts assigned to assets acquired (including identified intangible assets) and liabilities assumed is recorded as goodwill. As of March 31, 2020, and December 31, 2019, we had $40.6 million of goodwill at each date. The Companyās goodwill has an indeterminate life and is not amortized, but is tested for impairment on an annual basis, or more frequently if events or changes in circumstances indicate that the asset might be impaired. No impairment loss was recognized for the three months ended March 31, 2020, or 2019. ā Cash and Cash Equivalents ā Cash and cash equivalents include all non-restricted cash held in financial institutions and other non-restricted highly liquid short-term investments with original maturities at acquisition of three months or less. ā Initial Direct Costs ā Initial direct costs include commissions paid to third parties, including brokers, leasing and referral agents, and internal sales commissions paid to employees for successful execution of lease agreements. Initial direct costs are incremental costs that would not have been incurred if the lease agreement had not been executed. These initial direct costs are capitalized and generally amortized over the term of the related leases using the straight-line method. If a customer lease terminates prior to the expiration of its initial term, any unamortized initial direct costs related to the lease are written off to amortization expense. Amortization of initial direct costs was $3.3 million and $3.4 million for the three months ended March 31, 2020, and 2019, respectively. Initial direct costs are included within other assets in the condensed consolidated balance sheets and consisted of the following, net of amortization, as of March 31, 2020, and December 31, 2019 (in thousands): ā ā ā ā ā ā ā ā ā ā ā March 31, ā December 31, ā ā 2020 2019 Internal sales commissions ā $ 15,335 ā $ 15,064 ā Third party commissions ā ā 12,820 ā ā 10,845 ā Other ā ā 436 ā ā 462 ā Total ā $ 28,591 ā $ 26,371 ā ā Deferred Financing Costs ā Deferred financing costs include costs incurred in connection with obtaining debt and extending existing debt. These financing costs are capitalized and amortized on a straight-line basis, which approximates the effective-interest method, over the term of the indebtedness and the amortization is included as a component of interest expense. Depending on the type of debt instrument, deferred financing costs are reported either in other assets or as a direct deduction from the carrying amount of the related debt liabilities in our condensed consolidated balance sheets. ā Recoverability of Long-Lived Assets ā We review our long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Impairment is recognized when estimated expected future cash flows (undiscounted and without interest charges) are less than the carrying amount of the assets. The estimation of expected future net cash flows is inherently uncertain and relies, to a considerable extent, on assumptions regarding current and future economics and market conditions and the availability of capital. If, in future periods, there are changes in the estimates or assumptions incorporated into the impairment review analysis, the changes could result in an adjustment to the carrying amount of the long-lived assets. To the extent that impairment has occurred, the excess of the carrying amount of long-lived assets over its estimated fair value would be recognized as an impairment loss charged to net income. For the three months ended March 31, 2020, and 2019, no impairment of long-lived assets was recognized in the condensed consolidated financial statements. ā Derivative Instruments and Hedging Activities ā We reflect all derivative instruments at fair value as either assets or liabilities on the condensed consolidated balance sheets. For those derivative instruments that are designated and qualify as hedging instruments, we record the gain or loss on the hedging instruments as a component of accumulated other comprehensive income or loss. For derivatives that do not meet the criteria for hedge accounting, changes in fair value are immediately recognized within net income. See additional discussion in Note 8, Derivatives and Hedging Activities. ā Internal-Use Software ā We recognize internal-use software development costs based on the development stage of the project and nature of the cost. Internal and external costs incurred during the preliminary project stage are expensed as they are incurred. Internal and external costs incurred to develop internal-use software during the application development stage are capitalized. Internal and external training costs and maintenance costs during the post-implementation-operation stage are expensed as incurred. Completed projects are placed into service and amortized over the estimated useful life of the software. No impairment of internal-use software was recognized in the condensed consolidated financial statements for the three months ended March 31, 2020, and 2019. ā Revenue Recognition ā Rental, Power, and Related Revenue ā We derive our revenues from leases with customers for data center and office and light-industrial space. Our leases include rental revenue lease components and nonlease revenue components, such as power and tenant reimbursements. We have elected to combine all of our nonlease revenue components that have the same pattern of transfer as the related operating lease component into a single combined lease component. ā Our leases with customers are classified as operating leases and rental revenue is recognized on a straight-line basis over the customer lease term. Occasionally, our customer leases include options to extend or terminate the lease agreements. We do not include any of these extension or termination options in a customerās lease term for lease classification purposes or for recognizing rental revenue unless we are reasonably certain the customer will exercise these extension or termination options. The excess of rents recognized over amounts contractually due pursuant to the underlying leases is recorded as deferred rent receivable within other assets on our condensed consolidated balance sheets. ā In general, we provide two power products for our data center leased space, consisting of a fixed (breakered-amperage) and a variable (sub-metered) model. Customer power arrangements are coterminous with the customerās underlying lease and have the same pattern of transfer over the lease term and are therefore combined with lease revenue within our condensed consolidated statements of operations. For fixed power arrangements, a customer pays us a fixed monthly fee for a committed available amount of power. We recognize the fixed power revenue each month over the term of the lease. For variable power arrangements, a customer pays us variable monthly fees for the specific amount of power utilized at the current utility rates. We recognize variable power revenue each month as the uncertainty related to the consideration is resolved, as power is provided to our customers, and as our customers utilize the power. ā Some of our leases contain provisions under which our customers reimburse us for common area maintenance and other executory costs. These customer reimbursements are variable and are recognized in the period that the expenses are recognized. These services have the same pattern of transfer over the lease term and are also combined with lease revenue within our condensed consolidated statements of operations. ā Interconnection Revenue ā We also derive revenue from interconnection services, which are generally contracted on a month-to-month basis cancellable by us or the customer at any time. Interconnection services are accounted for as separate contracts and are not combined with lease and power arrangements. We recognize interconnection revenue each month as these services are delivered to, and utilized by, our customers. ā Allowance for Doubtful Accounts ā A provision for uncollectible accounts is recorded if the collectability of a receivable balance relating to contractual rent, rental revenue recorded on a straight-line basis, tenant reimbursements or other billed amounts is considered by management to not be probable. At March 31, 2020, and December 31, 2019, the allowance for doubtful accounts totaled $0.9 million and $0.4 million, respectively, on the condensed consolidated balance sheets. ā Lessee Accounting We determine if an arrangement is a lease at inception. Our operating lease agreements are primarily for real estate space and are included within operating lease right-of-use (āROUā) assets and operating lease liabilities on the condensed consolidated balance sheets. We elected the practical expedient to combine our lease and related nonlease components for our lessee building leases. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. Our variable lease payments consist of nonlease services related to the lease. Variable lease payments are excluded from the ROU assets and lease liabilities and are recognized in the period in which the obligation for those payments is incurred. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. ROU assets also include any lease payments made and exclude lease incentives. Many of our lessee agreements include options to extend the lease, which we do not include in our minimum lease terms unless they are reasonably certain to be exercised. Rental expense for lease payments related to operating leases is recognized on a straight-line basis over the lease term. Share-Based Compensation ā We account for share-based compensation using the fair value method of accounting. The estimated fair value of the stock options granted by us is calculated based on the Black-Scholes option-pricing model. The fair value of restricted share-based and Operating Partnership unit compensation is based on the fair value of our common stock on the date of the grant. The fair value of performance share awards, which have a market condition, is based on a Monte Carlo simulation. The fair value for all share-based compensation is amortized on a straight-line basis over the vesting period. We have elected to account for forfeitures as they occur. ā Asset Retirement and Environmental Remediation Obligations ā We record accruals for estimated asset retirement and environmental remediation obligations. The obligations relate primarily to the removal of asbestos during development of properties as well as the estimated equipment removal costs upon termination of a certain lease where we are the lessee. At March 31, 2020, and December 31, 2019, the amount included in unearned revenue, prepaid rent and other liabilities on the condensed consolidated balance sheets was approximately $1.7 million at each date. ā Income Taxes ā We elected to be taxed as a REIT under the Internal Revenue Code of 1986, as amended (the āCodeā), commencing with our taxable year ended December 31, 2010. To qualify as a REIT, we are required to distribute at least 90% of our taxable income to our stockholders and meet various other requirements imposed by the Code relating to such matters as operating results, asset holdings, distribution levels and diversity of stock ownership. Provided we qualify for taxation as a REIT, we generally are not subject to corporate level federal income tax on the earnings distributed currently to our stockholders. If we fail to qualify as a REIT in any taxable year, and are unable to avail ourselves of certain savings provisions set forth in the Code, all of our taxable income would be subject to federal income tax at regular corporate rates. ā To maintain REIT status, we must distribute a minimum of 90% of our taxable income. However, it is our policy and intent, subject to change, to distribute 100% of our taxable income and therefore, no provision is required in the accompanying condensed consolidated financial statements for federal income taxes with regard to our activities and our subsidiary pass-through entities. The allocable share of taxable income is included in the income tax returns of its stockholders. We are subject to the statutory requirements of the locations in which we conduct business. State and local income taxes are accrued as deemed required in the best judgment of management based on analysis and interpretation of respective tax laws. ā We have elected to treat certain subsidiaries as taxable REIT subsidiaries (āTRSā). Certain activities that we undertake must be conducted by a TRS, such as services for our tenants that could be considered otherwise impermissible for us to perform and holding assets that we cannot hold directly. A TRS is subject to corporate level federal and state income taxes. Deferred income taxes are recognized in certain taxable entities. Deferred income tax generally is a function of the periodās temporary differences (items that are treated differently for tax purposes than for financial reporting purposes), the utilization of tax net operating losses generated in prior years that previously had been recognized as deferred income tax assets and the reversal of any previously recorded deferred income tax liabilities. A valuation allowance for deferred income tax assets is provided if we believe all or some portion of the deferred income tax asset may more likely than not be realized. Any increase or decrease in the valuation allowance resulting from a change in circumstances that causes a change in the estimated realizability of the related deferred income tax asset is included in deferred tax expense. As of March 31, 2020, and December 31, 2019, the gross deferred income taxes were not material. ā We currently have no liabilities for uncertain income tax positions. The earliest tax year for which we are subject to examination is 2016. ā Concentration of Credit Risks ā Our cash and cash equivalents are maintained in various financial institutions, which, at times, may exceed federally insured limits. We have not experienced any losses in such accounts, and management believes that the Company is not exposed to any significant credit risk in this area. We have no off-balance sheet concentrations of credit risk, such as foreign exchange contracts, option contracts, or foreign currency hedging arrangements. ā Segment Information ā We manage our business as one reportable segment consisting of investments in data centers located in the United States. Although we provide services in several markets, these operations have been aggregated into one reportable segment based on the similar economic characteristics amongst all markets, including the nature of the services provided and the type of customers purchasing these services. ā Risks and Uncertainties ā The full extent of the operational and financial impact of the novel coronavirus (āCOVID-19ā) outbreak on our business has yet to be determined. The impact of the outbreak of COVID-19 is dependent on future developments, including, among other factors, the duration and spread of the outbreak, along with related government-mandated business shutdowns, travel advisories and restrictions on movement, the recovery time of general employment levels, disrupted supply chains, potentially material staffing shortages, construction and development delays, and uncertainty with respect to accessibility of additional funding sources. In addition, some of our customers and prospective customers are dependent on areas of the economy that have been significantly impacted by the outbreak of COVID-19, which may impact their ability to comply with their rent obligations or their demand for additional space and power from us. As of March 31, 2020, we have not recognized a material loss, impairment, or contingency within our condensed consolidated financial statements as a result of the COVID-19 pandemic. ā |
Investment in Real Estate
Investment in Real Estate | 3 Months Ended |
Mar. 31, 2020 | |
Investment in Real Estate | |
Investment in Real Estate | 3. Investment in Real Estate ā The following is a summary of the properties owned or leased by market at March 31, 2020 (in thousands): ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Buildings and ā Construction in ā ā ā ā Market Land Improvements Progress Total Cost Boston ā $ 5,154 ā $ 119,803 ā $ 3,005 ā $ 127,962 ā Chicago ā ā 5,493 ā ā 115,909 ā ā 110,768 ā ā 232,170 ā Denver ā ā ā ā ā 34,938 ā ā 386 ā ā 35,324 ā Los Angeles ā ā 18,672 ā ā 377,134 ā ā 81,178 ā ā 476,984 ā Miami ā ā 728 ā ā 14,641 ā ā ā ā ā 15,369 ā New York ā ā 2,729 ā ā 173,080 ā ā 54,719 ā ā 230,528 ā Northern Virginia ā ā 21,856 ā ā 401,645 ā ā 101,718 ā ā 525,219 ā San Francisco Bay ā ā 39,961 ā ā 778,380 ā ā 86,020 ā ā 904,361 ā Total ā $ 94,593 ā $ 2,015,530 ā $ 437,794 ā $ 2,547,917 ā ā ā ā The following is a summary of the properties owned or leased by market at December 31, 2019 (in thousands): ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Market Land Buildings and Construction in Total Cost ā Boston ā $ 5,154 ā $ 119,227 ā $ 931 ā $ 125,312 ā Chicago ā ā 5,493 ā ā 115,699 ā ā 100,118 ā ā 221,310 ā Denver ā ā ā ā ā 32,659 ā ā 2,461 ā ā 35,120 ā Los Angeles ā ā 18,672 ā ā 376,525 ā ā 60,178 ā ā 455,375 ā Miami ā ā 728 ā ā 14,491 ā ā 133 ā ā 15,352 ā New York ā ā 2,729 ā ā 155,746 ā ā 56,271 ā ā 214,746 ā Northern Virginia ā ā 21,856 ā ā 398,742 ā ā 101,619 ā ā 522,217 ā San Francisco Bay ā ā 39,961 ā ā 776,642 ā ā 72,763 ā ā 889,366 ā Total ā $ 94,593 ā $ 1,989,731 ā $ 394,474 ā $ 2,478,798 ā ā |
Other Assets
Other Assets | 3 Months Ended |
Mar. 31, 2020 | |
Other Assets. | |
Other Assets | ā 4. Other Assets ā Other assets consisted of the following, net of amortization and depreciation, if applicable for each line item, as of March 31, 2020, and December 31, 2019 (in thousands): ā ā ā ā ā ā ā ā ā ā ā March 31, ā December 31, ā ā 2020 2019 Deferred rent receivable ā $ 38,831 ā $ 38,335 ā Initial direct costs ā ā 28,591 ā ā 26,371 ā Internal-use software ā ā 16,699 ā ā 16,747 ā Prepaid expenses ā ā 12,178 ā ā 7,675 ā Corporate furniture, fixtures and equipment ā ā 4,507 ā ā 4,848 ā Deferred financing costs - revolving credit facility ā ā 3,076 ā ā 3,148 ā Other ā ā 673 ā ā 3,958 ā Total ā $ 104,555 ā $ 101,082 ā ā |
Leases
Leases | 3 Months Ended |
Mar. 31, 2020 | |
Leases | |
Leases | 5. Leases ā As the lessee, we currently lease real estate space under noncancelable operating lease agreements for our turn-key data centers at NY1, LA1, LA4, DC1, DC2, DE1, and DE2, and our corporate headquarters located in Denver, Colorado. Our leases have remaining lease terms ranging from 1 year to 15 years, some of the leases include options to extend the leases for up to an additional 20 years. We do not include any of our renewal options in our lease terms for calculating our lease liability as the renewal options allow us to maintain operational flexibility and we are not reasonably certain we will exercise these renewal options at this time. The weighted-average remaining non-cancelable lease term for our operating leases was nine years at March 31, 2020, and December 31, 2019. The weighted-average discount rate was 4.9% at each date. ā During the three months ended March 31, 2020, we extended the term of approximately 25,000 NRSF at our existing DC2 data center from July 2028 to July 2035. As a result of this extension, we remeasured the lease liability and adjusted the ROU asset by approximately $7.0 million. ā The components of lease expense were as follows (in thousands): ā ā ā ā ā ā ā ā ā ā ā ā Three Months Ended March 31, ā ā ā ā 2020 ā 2019 ā ā Lease expense: ā ā ā ā ā ā ā ā Operating lease expense ā $ 6,862 ā $ 6,396 ā ā Variable lease expense ā ā 1,537 ā ā 1,292 ā ā Rent expense ā $ 8,399 ā $ 7,688 ā ā ā ā |
Lease Revenue
Lease Revenue | 3 Months Ended |
Mar. 31, 2020 | |
Lease Revenue | |
Lease Revenue | 6. Lease Revenue ā The components of data center, office, light-industrial, and other lease revenue were as follows (in thousands): ā ā ā ā ā ā ā ā ā ā ā ā Three Months Ended March 31, ā ā ā ā 2020 ā 2019 ā ā Lease revenue: ā ā ā ā ā ā ā ā Minimum lease revenue ā $ 106,441 ā $ 99,410 ā ā Variable lease revenue ā ā 20,836 ā ā 21,069 ā ā Total lease revenue ā $ 127,277 ā $ 120,479 ā ā |
Debt
Debt | 3 Months Ended |
Mar. 31, 2020 | |
Debt | |
Debt | 7. Debt ā A summary of outstanding indebtedness as of March 31, 2020, and December 31, 2019, is as follows (in thousands): ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Maturity ā March 31, ā December 31, ā ā Interest Rate Date 2020 2019 Revolving credit facility (1) ā 2.45% and 3.01% at March 31, 2020, and December 31, 2019, respectively ā November 8, 2023 ā $ 155,500 ā $ 62,500 ā 2022 Senior unsecured term loan (1) ā 1.76% and 2.96% at March 31, 2020, and December 31, 2019, respectively ā April 19, 2022 ā ā 200,000 ā ā 200,000 ā 2023 Senior unsecured notes ā 4.19% at March 31, 2020, and December 31, 2019, respectively ā June 15, 2023 ā ā 150,000 ā ā 150,000 ā 2024 Senior unsecured term loan (1) ā 2.86% and 3.44% at March 31, 2020, and December 31, 2019, respectively ā April 19, 2024 ā ā 150,000 ā ā 150,000 ā 2024 Senior unsecured notes ā 3.91% at March 31, 2020, and December 31, 2019, respectively ā April 20, 2024 ā ā 175,000 ā ā 175,000 ā 2025 Senior unsecured term loan (1) ā 2.32% and 2.81% at March 31, 2020, and December 31, 2019, respectively ā April 1, 2025 ā ā 350,000 ā ā 350,000 ā 2026 Senior unsecured notes (1) ā 4.52% at March 31, 2020, and December 31, 2019, respectively ā April 17, 2026 ā ā 200,000 ā ā 200,000 ā 2029 Senior unsecured notes ā 4.31% at March 31, 2020, and December 31, 2019, respectively ā April 17, 2029 ā ā 200,000 ā ā 200,000 ā Total principal outstanding ā ā ā ` ā ā 1,580,500 ā ā 1,487,500 ā Unamortized deferred financing costs ā ā ā ā ā ā (8,493) ā ā (9,098) ā Total debt ā ā ā ā ā $ 1,572,007 ā $ 1,478,402 ā (1) Our Operating Partnership has in place swap agreements with respect to the term loans noted above. The interest rates presented represent the effective interest rates as of March 31, 2020, and December 31, 2019, including the impact of the interest rate swaps, which effectively fix the interest rate on a portion of our variable rate debt. We entered into three new interest rate swaps during the quarter ended March 31, 2020. See Note 8 ā Derivatives and Hedging Activities. ā Revolving Credit Facility ā On November 8, 2019, our Operating Partnership and certain subsidiary co-borrowers entered into the Fifth Amended and Restated Credit Agreement (as amended and restated, the āAmended and Restated Credit Agreementā), which amended and restated our previous credit agreement, to provide additional liquidity of $100 million, which was used to pay down a portion of the then-existing revolving credit facility and for general corporate purposes. The Amended and Restated Credit Agreement, among other things, decreased the interest rates on borrowings under the revolving credit facility and certain term loans, and extended the maturity date from April 19, 2022, to November 8, 2023, with a one-time extension option, which, if exercised, would extend the maturity date to November 8, 2024. The exercise of the extension option is subject to payment of an extension fee equal to 10 basis points of total commitments under the Amended and Restated Credit Agreement at initial maturity and certain other customary conditions. The Amended and Restated Credit Agreement increased our total commitment from $850 million to $950 million, consisting of a $450 million revolving credit facility, a $150 million senior unsecured term loan scheduled to mature on April 19, 2024, and a $350 million senior unsecured term loan scheduled to mature on April 1, 2025. See ā2024 Senior Unsecured Term Loanā and ā2025 Senior Unsecured Term Loanā below for a discussion of the $150 million and $350 million senior unsecured term loans, respectively. The Amended and Restated Credit Agreement also increased our accordion feature by $200 million to $550 million, which allows our Operating Partnership to increase our total commitments from $950 million to $1.5 billion, under specified circumstances, including securing capital from new or existing lenders. ā Borrowings under the revolving credit facility were amended to bear interest at a variable rate per annum equal to either (i) LIBOR plus 125 basis points to 185 basis points, or (ii) a base rate plus 25 basis points to 85 basis points, each depending on our Operating Partnershipās leverage ratio. At March 31, 2020, our Operating Partnershipās leverage ratio was 31.2% and the interest rate was LIBOR plus 125 basis points. The total amount available for borrowing under the revolving credit facility, is equal to the lesser of $450.0 million or the availability calculated based on our unencumbered asset pool. As of March 31, 2020, the borrowing capacity was $450.0 million. As of March 31, 2020, $155.5 million was borrowed and outstanding, $6.1 million was outstanding under letters of credit, and therefore $288.4 million remained available for us to borrow under the revolving credit facility. ā Our ability to borrow under the Amended and Restated Credit Agreement is subject to ongoing compliance with a number of financial covenants and other customary restrictive covenants, including, among others: ā ā a maximum leverage ratio (defined as total consolidated indebtedness to total gross asset value) of 60% , which, as of March 31, 2020, was 31.2% ā a maximum secured debt ratio (defined as total consolidated secured debt to total gross asset value) of 40% , which, as of March 31, 2020, was 0.0% ā a minimum fixed charge coverage ratio (defined as adjusted consolidated earnings before interest, taxes, depreciation and amortization to consolidated fixed charges) of 1.5 to 1.0, which, as of March 31, 2020, was 5.8 to 1.0. ā The Amended and Restated Credit Agreement ranks pari passu with the 2022 Term Loan, the 2024 Term Loan, the 2025 Term Loan, the 2023 Notes, the 2024 Notes, the 2026 Notes, and the 2029 Notes (each as defined herein) and contains the same financial covenants and other customary restrictive covenants as those debt instruments. In connection with the Amended and Restated Credit Agreement, the revolving credit facility and senior unsecured term loans were amended to remove or change certain financial covenants and other customary restrictive covenants, including removal of covenants limiting distributions (except upon an event of default), incurrence of unhedged variable rate debt, and increases or decreases, as applicable, to a number of ratios and other figures in the Amended and Restated Credit Agreement, resulting in increased flexibility for our Operating Partnership. As of March 31, 2020, we were in compliance with all of the financial covenants under the Amended and Restated Credit Agreement. ā 2022 Senior Unsecured Term Loan ā On April 19, 2017, our Operating Partnership and certain subsidiaries entered into an Amended and Restated Term Loan Agreement (as amended and restated, the āTerm Loan Agreementā), which amended and restated the $100 million senior unsecured term loan, originally entered into on January 31, 2014 (the ā2022 Term Loanā). The Term Loan Agreement was amended and restated to, among other things, (i) exercise the accordion feature to increase the total commitments to $200 million, (ii) extend the maturity of the term loan from January 31, 2019, to April 19, 2022, (iii) amend the accordion feature to allow an increase in total commitments from $200 million to $300 million, under specified circumstances, including securing capital from new or existing lenders, and (iv) explicitly permit the issuance of the 2024 Notes. ā The 2022 Term Loan ranks pari passu with the 2024 Term Loan, the 2025 Term Loan, the 2023 Notes, the 2024 Notes, the 2026 Notes, the 2029 Notes and the Amended and Restated Credit Agreement and contains the same financial covenants and other customary restrictive covenants as those debt instruments. As of March 31, 2020, we were in compliance with all of the financial covenants under the 2022 Term Loan. ā Borrowings under the 2022 Term Loan bear interest at a variable rate per annum equal to either (i) LIBOR plus 120 basis points to 180 basis points, or (ii) a base rate plus 20 basis points to 80 basis points, each depending on our Operating Partnershipās leverage ratio. At March 31, 2020, our Operating Partnershipās leverage ratio was 31.2% and the interest rate was LIBOR plus 120 basis points. ā 2024 Senior Unsecured Term Loan ā On November 8, 2019, pursuant to the terms of the Amended and Restated Credit Agreement, our Operating Partnership and certain subsidiaries extended the term of the $150 million senior unsecured term loan (as amended, the ā2024 Term Loanā) from April 19, 2023, to April 19, 2024. The 2024 Term Loan ranks pari passu with the 2022 Term Loan, the 2025 Term Loan, the 2023 Notes, the 2024 Notes, the 2026 Notes, the 2029 Notes, and the Amended and Restated Credit Agreement and contains the same financial covenants and other customary restrictive covenants as those debt instruments. As of March 31, 2020, we were in compliance with all of the financial covenants under the 2024 Term Loan. ā Borrowings under the 2024 Term Loan bear interest at a variable rate per annum equal to either (i) LIBOR plus 120 basis points to 180 basis points, or (ii) a base rate plus 20 basis points to 80 basis points, each depending on our Operating Partnershipās leverage ratio. At March 31, 2020, our Operating Partnershipās leverage ratio was 31.2% and the interest rate was LIBOR plus 120 basis points. ā 2025 Senior Unsecured Term Loan ā On November 8, 2019, pursuant to the terms of the Amended and Restated Credit Agreement, our Operating Partnership and certain subsidiaries entered into a new $350 million senior unsecured term loan (the ā2025 Term Loanā) maturing on April 1, 2025. The proceeds from the 2025 Term Loan were used to pay down the previous $150 million 2020 Term Loan and the $100 million 2021 Term Loan, pay down a portion of the then-existing revolving credit facility, and for general corporate purposes. The 2025 Term Loan ranks pari passu with the 2022 Term Loan, the 2024 Term Loan, the 2023 Notes, the 2024 Notes, the 2026 Notes, the 2029 Notes, and the Amended and Restated Credit Agreement and contains the same financial covenants and other customary restrictive covenants as those debt instruments. As of March 31, 2020, we were in compliance with all of the financial covenants under the 2025 Term Loan. ā Borrowings under the 2025 Term Loan bear interest at a variable rate per annum equal to either (i) LIBOR plus 120 basis points to 180 basis points, or (ii) a base rate plus 20 basis points to 80 basis points, each depending on our Operating Partnershipās leverage ratio. At March 31, 2020, our Operating Partnershipās leverage ratio was 31.2% and the interest rate was LIBOR plus 120 basis points. ā 2023 Senior Unsecured Notes ā On June 15, 2016, our Operating Partnership issued an aggregate principal amount of $150 million, 4.19% senior unsecured notes due June 15, 2023 (the ā2023 Notesā), in a private placement to certain accredited investors. The terms of the 2023 Notes are governed by a note purchase agreement, dated June 15, 2016 (the ā2023 Note Purchase Agreementā), by and among our Operating Partnership, the Company and the purchasers of the 2023 Notes. ā Interest is payable semiannually, on the 15 th ā Our Operating Partnership may prepay all or a portion of the 2023 Notes upon notice to the holders for 100% of the principal amount so prepaid plus a make-whole premium as set forth in the 2023 Note Purchase Agreement. Upon the occurrence of certain change of control events, holders of the 2023 Notes have the right to require our Operating Partnership to purchase 100% of such holderās 2023 Notes in cash at a purchase price equal to 100% of the principal amount thereof plus accrued and unpaid interest, if any, to the date of repurchase. ā The 2023 Notes rank pari passu with the 2022 Term Loan, the 2024 Term Loan, the 2025 Term Loan, the 2024 Notes, the 2026 Notes, the 2029 Notes and the Amended and Restated Credit Agreement. On June 12, 2018, the 2023 Note Purchase Agreement was amended to, among other things, conform to the same financial covenants as the Amended and Restated Credit Agreement, as described above. In addition, certain additional financial covenants in the Amended and Restated Credit Agreement were automatically incorporated into the 2023 Note Purchase Agreement, and, subject to certain conditions, these additional financial covenants will be deleted, removed, amended or otherwise modified to be more or less restrictive if the analogous covenant in the Credit Agreement is so deleted, removed, amended or otherwise modified. These covenants are subject to a number of exceptions and qualifications set forth in the 2023 Note Purchase Agreement. As of March 31, 2020, we were in compliance with all of the financial covenants under the 2023 Note Purchase Agreement. ā 2024 Senior Unsecured Notes ā On April 20, 2017, our Operating Partnership issued an aggregate principal amount of $175 million, 3.91% senior unsecured notes due April 20, 2024 (the ā2024 Notesā), in a private placement to certain accredited investors. The terms of the 2024 Notes are governed by a note purchase agreement, dated April 20, 2017 (the ā2024 Note Purchase Agreementā), by and among our Operating Partnership, the Company and the purchasers of the 2024 Notes. ā Interest is payable semiannually, on the 15 th ā Our Operating Partnership may prepay all or a portion of the 2024 Notes upon notice to the holders for 100% of the principal amount plus a make-whole premium as set forth in the 2024 Note Purchase Agreement. Upon the occurrence of certain change of control events, holders of the 2024 Notes would have the right to require our Operating Partnership to purchase 100% of such holdersā 2024 Notes in cash at a purchase price equal to 100% of the principal amount thereof plus accrued and unpaid interest, if any, to the date of repurchase. ā The 2024 Notes rank pari passu with the 2022 Term Loan, the 2024 Term Loan, the 2025 Term Loan, the 2023 Notes, the 2026 Notes, the 2029 Notes and the Amended and Restated Credit Agreement. On June 12, 2018, the 2024 Note Purchase Agreement was amended to, among other things, conform to the same financial covenants as the Amended and Restated Credit Agreement, as described above. In addition, certain additional financial covenants in the Amended and Restated Credit Agreement were automatically incorporated into the 2024 Note Purchase Agreement, and, subject to certain conditions, these additional financial covenants will be deleted, removed, amended or otherwise modified to be more or less restrictive if the analogous covenant in the Amended and Restated Credit Agreement is so deleted, removed, amended or otherwise modified. These covenants are subject to a number of exceptions and qualifications set forth in the 2024 Note Purchase Agreement. As of March 31, 2020, we were in compliance with all of the financial covenants under the 2024 Note Purchase Agreement. ā 2026 Senior Unsecured Notes ā On April 17, 2019, our Operating Partnership issued an aggregate principal amount of $200 million, 4.11% Series A senior unsecured notes due April 17, 2026 (the ā2026 Notesā), in a private placement to certain accredited investors. After giving effect to cancellation costs incurred in connection with the termination of an interest rate swap agreement entered into in anticipation of the issuance of the Notes, the 2026 Notes bear an effective interest rate of 4.52% per annum. The terms of the 2026 Notes are governed by a note purchase agreement, dated April 17, 2019 (the ā2026 Note Purchase Agreementā), by and among our Operating Partnership, the Company and the purchasers of the 2026 Notes. ā Interest is payable semiannually, on the 15 th ā Our Operating Partnership may prepay all or a portion of the 2026 Notes upon notice to the holders for 100% of the principal amount so prepaid plus a make-whole premium as set forth in the 2026 Note Purchase Agreement. Upon the occurrence of certain change of control events, holders of the 2026 Notes would have the right to require our Operating Partnership to purchase 100% of such holdersā 2026 Notes in cash at a purchase price equal to 100% of the principal amount thereof plus accrued and unpaid interest, if any, to the date of repurchase. ā The 2026 Notes rank pari passu with the 2022 Term Loan, the 2024 Term Loan, the 2025 Term Loan, the 2023 Notes, the 2024 Notes, the 2029 Notes and the Amended and Restated Credit Agreement. The 2026 Note Purchase Agreement conforms to the same financial covenants as the Amended and Restated Credit Agreement, as described above. In addition, on the date of the 2026 Note Purchase Agreement and from time to time, certain additional financial covenants in the Amended and Restated Credit Agreement will be automatically incorporated into the 2026 Note Purchase Agreement and, subject to certain conditions, will be deleted, removed, amended or otherwise modified to be more or less restrictive if the analogous covenant in the Amended and Restated Credit Agreement is so deleted, removed, amended or otherwise modified. These covenants are subject to a number of exceptions and qualifications set forth in the 2026 Note Purchase Agreement. As of March 31, 2020, we were in compliance with all of the financial covenants under the 2026 Note Purchase Agreement. ā 2029 Senior Unsecured Notes ā As mentioned above, on April 17, 2019, our Operating Partnership entered into the 2026 Note Purchase Agreement to issue the 2026 Notes and an additional aggregate principal amount of $200 million, 4.31% Series B senior unsecured notes due April 17, 2029 (the ā2029 Notesā), in a private placement to certain accredited investors. An aggregate principal amount of $125 million of the 2029 Notes was issued on April 17, 2019. The remaining $75 million of the 2029 Notes was issued on July 17, 2019. The terms of the 2029 Notes are governed by the 2026 Note Purchase Agreement, by and among our Operating Partnership, the Company and the purchasers of the 2029 Notes. ā Interest is payable semiannually, on the 15 th ā Our Operating Partnership may prepay all or a portion of the 2029 Notes upon notice to the holders for 100% of the principal amount plus a make-whole premium as set forth in the 2026 Note Purchase Agreement. Upon the occurrence of certain change of control events, holders of the 2029 Notes would have the right to require our Operating Partnership to purchase 100% of such holdersā 2029 Notes in cash at a purchase price equal to 100% of the principal amount thereof plus accrued and unpaid interest, if any, to the date of repurchase. ā The 2029 Notes rank pari passu with the 2022 Term Loan, the 2024 Term Loan, the 2025 Term Loan, the 2023 Notes, the 2024 Notes, the 2026 Notes and the Amended and Restated Credit Agreement. As of March 31, 2020, we were in compliance with all of the financial covenants under the 2026 Note Purchase Agreement. ā Debt Maturities ā The following table summarizes when our debt currently becomes due (in thousands): ā ā ā ā ā ā Year Ending December 31, ā ā 2020 ā $ ā ā 2021 ā ā ā ā 2022 ā ā 200,000 ā 2023 ā ā 305,500 ā 2024 ā ā 325,000 ā Thereafter ā ā 750,000 ā Total principal outstanding ā ā 1,580,500 ā Unamortized deferred financing costs ā ā (8,493) ā Total debt, net ā $ 1,572,007 ā ā ā Subsequent Debt Financing ā On April 15, 2020, we agreed with lenders on the pricing of 7-year ā ā ā ā |
Derivatives and Hedging Activit
Derivatives and Hedging Activities | 3 Months Ended |
Mar. 31, 2020 | |
Derivatives and Hedging Activities | |
Derivatives and Hedging Activities | 8. Derivatives and Hedging Activities ā The following table summarizes our derivative positions as of March 31, 2020, and December 31, 2019 (in thousands): ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Notional Amount ā ā ā ā ā ā ā ā ā ā ā ā Fair Value (Level 2) (1) ā March 31, ā December 31, ā Type of ā ā ā ā ā ā Effective ā Expiration ā March 31, ā December 31, ā 2020 ā 2019 ā Derivative ā Index ā Strike Rate ā ā Date ā Date ā 2020 ā 2019 ā $ 75,000 ā $ 75,000 ā Interest Rate Swap ā 1 mo. LIBOR ā 1.43 % ā 5/5/2015 ā 5/5/2020 ā $ (30) ā $ 67 ā ā 75,000 ā ā 75,000 ā Interest Rate Swap ā 1 mo. LIBOR ā 2.72 ā ā 5/5/2018 ā 4/5/2023 ā ā (5,469) ā ā (2,819) ā ā 100,000 ā ā 100,000 ā Interest Rate Swap ā 1 mo. LIBOR ā 1.59 ā ā 11/8/2019 ā 4/1/2025 ā ā (5,918) ā ā 55 ā ā 75,000 ā ā 75,000 ā Interest Rate Swap ā 1 mo. LIBOR ā 1.59 ā ā 11/8/2019 ā 4/1/2025 ā ā (4,439) ā ā 41 ā ā 200,000 ā ā ā ā Interest Rate Swap ā 1 mo. LIBOR ā 0.56 ā ā 3/5/2020 ā 4/19/2022 ā ā (1,104) ā ā ā ā ā 75,000 ā ā ā ā Interest Rate Swap ā 1 mo. LIBOR ā 0.61 ā ā 3/5/2020 ā 10/5/2023 ā ā (738) ā ā ā ā ā 175,000 ā ā ā ā Interest Rate Swap ā 1 mo. LIBOR ā 0.64 ā ā 3/5/2020 ā 10/1/2024 ā ā (2,075) ā ā ā ā $ 775,000 ā $ 325,000 ā ā ā ā ā ā ā ā ā ā ā ā $ (19,773) ā $ (2,656) ā (1) Derivative assets are recorded at fair value in our condensed consolidated balance sheets in other assets and derivative liabilities are recorded at fair value in our condensed consolidated balance sheets in unearned revenue, prepaid rent and other liabilities. We do not net our derivative position by counterparty for purposes of balance sheet presentation and disclosure. ā Risk Management Objective of Using Derivatives ā We are exposed to certain risks arising from both our business operations and economic conditions. We principally manage our exposures to a wide variety of business and operational risks through management of our core business activities. We manage economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of our debt funding and the use of derivative financial instruments. Specifically, we enter into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known or uncertain cash amounts, the value of which are determined by interest rates. Our derivative financial instruments are used to manage differences in the amount, timing, and duration of our known or expected cash receipts and our known or expected cash payments principally related to our investments and borrowings. ā Cash Flow Hedges of Interest Rate Risk ā Our objectives in using interest rate derivatives are to reduce variability in interest expense and to manage our exposure to adverse interest rate movements. To accomplish this objective, we primarily use interest rate swaps as part of our interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. ā The changes in the fair value of derivatives designated and that qualify as effective cash flow hedges is recorded in accumulated other comprehensive income or loss on the condensed consolidated balance sheets and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. ā Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on our variable-rate debt. During the subsequent twelve months, beginning April 1, 2020, we estimate that $6.0 million will be reclassified as an increase to interest expense. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2020 | |
Stockholders' Equity | |
Stockholders' Equity | 9. Stockholdersā Equity ā We announced the following dividends per share on our common stock during the three months ended March 31, 2020: ā ā ā ā ā ā ā ā ā ā Declaration Date Record Date Payment Date Common Stock March 5, 2020 ā March 31, 2020 ā April 15, 2020 ā $ 1.22 ā ā |
Noncontrolling Interests - Oper
Noncontrolling Interests - Operating Partnership | 3 Months Ended |
Mar. 31, 2020 | |
Noncontrolling Interests - Operating Partnership | |
Noncontrolling Interests - Operating Partnership | 10. Noncontrolling Interests ā Operating Partnership ā Noncontrolling interests represent the limited partnership interests in our Operating Partnership held by individuals and entities other than CoreSite Realty Corporation. The current holders of common Operating Partnership units are eligible to have the common Operating Partnership units redeemed for cash or common stock on a one-for-one basis, at our option. ā The following table shows the common ownership interests in our Operating Partnership as of March 31, 2020, and December 31, 2019: ā ā ā ā ā ā ā ā ā ā ā ā ā March 31, 2020 ā December 31, 2019 ā ā Number of Units Percentage of Total ā Number of Units Percentage of Total ā CoreSite Realty Corporation ā 37,394,352 ā 77.6 % 37,244,987 ā 77.6 % Noncontrolling interests ā 10,769,518 ā 22.4 ā 10,771,658 ā 22.4 ā Total ā 48,163,870 ā 100.0 % 48,016,645 ā 100.0 % ā For each share of common stock issued by us, our Operating Partnership issues to us an equivalent common Operating Partnership unit. During the three months ended March 31, 2020, we issued 149,365 shares of common stock related to employee compensation arrangements and therefore an equivalent number of common Operating Partnership units were issued to us by our Operating Partnership. ā Holders of common Operating Partnership units received aggregate distributions of $1.22 per unit during the three months ended March 31, 2020, payable in correlation with declared dividends on shares of our common stock. ā The redemption value of the noncontrolling interests at March 31, 2020, was $1.2 billion based on the closing price of the Companyās common stock of $115.90 per share on the last trading day prior to that date. |
Equity Incentive Plan
Equity Incentive Plan | 3 Months Ended |
Mar. 31, 2020 | |
Equity Incentive Award Plan | |
Equity Incentive Plan | 11. Equity Incentive Plan ā Our Board of Directors adopted and, with the approval of our stockholders, amended the 2010 Equity Incentive Plan (as amended, the ā2010 Planā) in 2013. The 2010 Plan is administered by the Compensation Committee of our Board of Directors. Awards issuable under the 2010 Plan include common stock, stock options, restricted stock, restricted stock units, stock appreciation rights, dividend equivalents, Operating Partnership units and other incentive awards. We have reserved a total of 6,000,000 shares of our common stock for issuance pursuant to the 2010 Plan, which may be adjusted for changes in our capitalization and certain corporate transactions. To the extent that an award expires, terminates or lapses, or an award is settled in cash without the delivery of shares of common stock to the participant, then any unvested shares subject to the award will be available for future grant or sale under the 2010 Plan. Shares of restricted stock that are forfeited or repurchased by us pursuant to the 2010 Plan may again be awarded under the 2010 Plan. The payment of dividend equivalents in cash in conjunction with any outstanding awards will not be counted against the shares available for issuance under the 2010 Plan. ā As of March 31, 2020, 2,474,370 shares of our common stock were available for issuance pursuant to the 2010 Plan. ā Stock Options ā Stock option awards are granted with an exercise price equal to the closing market price of the Companyās common stock on the date of grant. The fair value of each option granted under the 2010 Plan is estimated on the date of grant using the Black-Scholes option-pricing model. The fair values are amortized on a straight-line basis over the vesting periods. Stock options have not been granted since the year ended December 31, 2013. As of March 31, 2020, all stock option awards are fully vested. The following table sets forth stock option activity under the 2010 Plan for the three months ended March 31, 2020: ā ā ā ā ā ā ā ā ā ā Number of ā ā ā ā ā Shares ā Weighted- ā ā ā Subject to ā Average ā ā ā Option ā Exercise Price ā Options outstanding, December 31, 2019 31,746 $ 19.57 Granted ā ā ā ā ā ā Exercised ā (3,210) ā ā 18.87 ā Forfeited ā ā ā ā ā ā Expired ā ā ā ā ā ā Options outstanding, March 31, 2020 ā 28,536 ā $ 19.65 ā ā Restricted Stock Awards and Units ā Restricted stock awards and restricted stock units (āRSUsā) are granted with a fair value equal to the closing market price of the Companyās common stock on the date of grant. The principal difference between restricted stock awards and RSUs is that RSUs are not shares of our common stock and do not have any of the rights or privileges thereof, including voting rights. On the applicable vesting date, the holder of an RSU becomes entitled to a share of common stock. The restricted stock awards and RSUs are amortized on a straight-line basis to expense over the vesting period. The following table sets forth the number of unvested restricted stock awards and RSUs and the weighted-average fair value of these awards at the date of grant: ā ā ā ā ā ā ā ā ā ā Restricted ā Weighted- ā ā ā Stock ā Average Fair ā ā ā Awards and ā Value at Grant ā ā Units Date ā Unvested balance, December 31, 2019 ā 292,373 ā $ 96.44 ā Granted ā 146,582 ā ā 110.73 ā Forfeited ā (4,913) ā ā 99.04 ā Vested ā (112,245) ā ā 90.76 ā Unvested balance, March 31, 2020 ā 321,797 ā $ 104.90 ā ā As of March 31, 2020, total unearned compensation on restricted stock awards and RSUs was approximately $32.0 million, and the weighted-average vesting period was 2. ā Performance Stock Awards ā We grant long-term incentives to members of management in the form of performance-based restricted stock awards (āPSAsā) under the 2010 Plan. The number of PSAs earned is based on our achievement of relative total shareholder return (āTSRā) measured versus the MSCI US REIT Index over a three-year performance period and ranges between 25% and 175% of the target number of shares for PSAs granted in 2018, 2019, and 2020. The PSAs are granted at the maximum percentage of target and are retired annually to the extent we do not meet the maximum relative TSR performance threshold versus the MSCI US REIT Index. The PSAs are earned upon TSR achievement measured both annually ā The following table sets forth the number of unvested PSAs and the weighted-average fair value of these awards at the date of grant: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Weighted- ā ā ā ā ā ā ā Average Fair ā ā ā Performance-Based Restricted Stock Awards ā Value at Grant ā ā Minimum ā Maximum Target Date Unvested balance, December 31, 2019 ā 34,624 ā 171,351 ā 102,989 ā $ 107.84 ā Granted ā 10,210 ā 71,488 ā 40,852 ā ā 125.02 ā Performance adjustment (1) ā 38,047 ā (7,904) ā 15,073 ā ā ā ā Forfeited ā (1,049) ā (4,878) ā (2,964) ā ā 107.63 ā Vested ā (32,524) ā (32,524) ā (32,524) ā ā 105.55 ā Unvested balance, March 31, 2020 ā 49,308 ā 197,533 ā 123,426 ā $ 113.96 ā (1) Includes the annual adjustment for the number of PSAs earned based on our achievement of relative TSR measured versus the MSCI US REIT Index for the applicable performance periods. ā As of March 31, 2020, total unearned compensation on PSAs was approximately $9.6 million, and the weighted-average vesting period was 2.4 years. The fair value of each PSA award is estimated on the date of grant using a Monte Carlo simulation. The simulation requires assumptions for expected volatility, risk-free rate of return, and dividend yield. The following table summarizes the assumptions used to value the PSAs granted during the three months ended March 31, 2020, and 2019 ā ā ā ā ā ā ā ā ā Three Months Ended March 31, ā ā 2020 ā 2019 ā Expected term (in years) ā 2.82 ā 2.82 ā Expected volatility ā 24.00 % 24.09 % Expected annual dividend (1) ā ā ā ā ā Risk-free rate ā 0.56 % 2.48 % (1) The fair value of the PSAs assumes reinvestment of dividends. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share | |
Earnings Per Share | ā 12. Earnings Per Share ā Basic net income per share is calculated by dividing the net income attributable to common shares by the weighted-average number of common shares outstanding during the period. Diluted net income per share adjusts basic net income per share for the effects of potentially dilutive common shares, if the effect is not antidilutive. Potentially dilutive common stock consists of shares issuable under the 2010 Plan. ā The following is a summary of basic and diluted net income per share (in thousands, except share and per share amounts): ā ā ā ā ā ā ā ā ā ā ā Three Months Ended March 31, ā ā 2020 2019 Net income attributable to common shares ā $ 17,848 ā $ 19,661 ā Weighted-average common shares outstanding - basic ā ā 37,335,892 ā ā 36,347,781 ā Effect of potentially dilutive common shares: ā ā ā ā ā ā ā Stock options ā ā 25,298 ā ā 38,921 ā Unvested awards ā ā 143,159 ā ā 160,363 ā Weighted-average common shares outstanding - diluted ā ā 37,504,349 ā ā 36,547,065 ā Net income per share attributable to common shares ā ā ā ā ā ā ā Basic ā $ 0.48 ā $ 0.54 ā Diluted ā $ 0.48 ā $ 0.54 ā ā In the calculations above, we have excluded weighted-average potentially dilutive securities of 2,054 and 39,754 for the three months ended March 31, 2020, and 2019, respectively, as their effect would have been antidilutive. |
Estimated Fair Value of Financi
Estimated Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2020 | |
Estimated Fair Value of Financial Instruments | |
Estimated Fair Value of Financial Instruments | 13. Estimated Fair Value of Financial Instruments ā Authoritative guidance issued by FASB establishes a hierarchy of valuation techniques based on the observability of inputs utilized in measuring assets and liabilities at fair values. This hierarchy establishes market-based or observable inputs as the preferred source of values, followed by valuation models using management assumptions in the absence of market inputs. The three levels of the hierarchy under the authoritative guidance are as follows: ā Level 1 ā Level 2 ā Level 3 ā Our financial instruments consist of cash and cash equivalents, accounts and other receivables, interest rate swaps, the revolving credit facility, the senior unsecured term loans, senior unsecured notes, interest payable and accounts payable. The carrying values of cash and cash equivalents, accounts and other receivables, interest payable and accounts payable approximate fair values due to the short-term nature of these financial instruments. The interest rate swaps are recorded at fair value. ā The valuation of our derivatives is determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of each derivative, which reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves. We have determined that the majority of the inputs used to value our derivatives fall within Level 2 of the fair value hierarchy; however, the credit valuation adjustments associated with our derivatives utilize Level 3 inputs, such as estimates of current credit spreads, to evaluate the likelihood of default by our Operating Partnership and its counterparties. As of March 31, 2020, we have assessed the significance of the impact of the credit valuation adjustments on the overall valuation of our derivative positions and have determined that the credit valuation adjustment is not significant to the overall valuation of our derivative portfolio. As a result, we classify our derivative valuation in Level 2 of the fair value hierarchy. ā The total principal balance of our revolving credit facility, senior unsecured term loans, and senior unsecured notes was $1.6 billion and $1.5 billion as of March 31, 2020, and December 31, 2019, which approximates the fair value based on Level 3 inputs from the fair value hierarchy. Under the discounted cash flow method, the fair values of the revolving credit facility, the senior unsecured term loans, and the senior unsecured notes are based on our assumptions of market interest rates and terms available incorporating our credit risk for similar loan maturities. ā Our lease liabilities are determined based on the estimated present value of our minimum lease payments under our lease agreements at lease commencement. The discount rate used to determine the lease liabilities is based on our estimated incremental borrowing rate at lease commencement, based on Level 3 inputs from the fair value hierarchy. ā |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies. | |
Commitments and Contingencies | 14. Commitments and Contingencies ā Our properties require periodic investments of capital for general capital improvements and for tenant-related capital expenditures. We enter into various construction and equipment contracts with third parties for the development of our properties. At March 31, 2020, we had open commitments related to construction contracts of approximately $145.7 million. ā Additionally, we have commitments related to telecommunications capacity used to connect data centers located within the same market or geographical area, power usage, and company-wide improvements that are ancillary to revenue generation. At March 31, 2020, we had open commitments related to these contracts of approximately $75.2 million, of which $5.7 million is scheduled to be met during the remainder of the year ending December 31, 2020. ā In the ordinary course of business, we are subject to claims and administrative proceedings. We are not presently party to any proceeding, which we believe to be material or which we would expect to have, individually or in the aggregate, a material adverse effect on our business, financial condition, cash flows or results of operations. The outcome of litigation and administrative proceedings is inherently uncertain. Therefore, if one or more legal or administrative matters are resolved against us in a reporting period for amounts in excess of managementās expectations, our financial condition, cash flows or results of operations for that reporting period could be materially adversely affected. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Summary of Significant Accounting Policies | |
Principles of Consolidation and Basis of Presentation | Principles of Consolidation and Basis of Presentation ā The accompanying unaudited condensed consolidated financial statements have been prepared by our management in accordance with U.S. generally accepted accounting principles (āGAAPā) for interim financial information and in compliance with the rules and regulations of the U.S. Securities and Exchange Commission. Accordingly, these unaudited condensed consolidated financial statements do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of our management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. The results of operations for the three months ended March 31, 2020, are not necessarily indicative of the expected results for the year ending December 31, 2020. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K ā Our Operating Partnership meets the definition and criteria of a variable interest entity (āVIEā) and we are the primary beneficiary of the VIE. Our sole significant asset is the investment in our Operating Partnership, and consequently, substantially all of our assets and liabilities represent those assets and liabilities of our Operating Partnership. Our debt is an obligation of our Operating Partnership where the creditors also have recourse against the credit of the Company. Intercompany balances and transactions have been eliminated upon consolidation. |
Recent Accounting Pronouncements | Recently Adopted Accounting Pronouncements ā Fair Value Measurement ā In August 2018, the Financial Accounting Standards Board (āFASBā) issued guidance codified in Accounting Standards Update (āASUā) 2018-13, Fair Value Measurement Intangibles ā Goodwill and Other ā Internal-Use Software ā In August 2018, the FASB issued guidance codified in ASU 2018-15, Intangibles ā Goodwill and Other ā Internal-Use Software Financial Instruments ā Credit Losses In June 2016, the FASB issued guidance codified in ASU 2016-13, Financial Instruments ā Credit Losses Codification Improvements to Topic 326, Financial Instruments ā Credit Losses Recent Accounting Pronouncements Not Yet Adopted ā Reference Rate Reform ā In March 2020, the FASB issued guidance codified in ASU 2020-04, Reference Rate Reform ā We determined that all other recently issued accounting pronouncements will not have a material impact on our condensed consolidated financial statements or do not apply to our operations. |
Use of Estimates | Use of Estimates ā The preparation of these unaudited condensed consolidated financial statements, in conformity with GAAP, requires our management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingencies at the date of the unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. We evaluate our estimates, including those related to assessing our standalone selling prices, performance-based equity compensation plans and the carrying values of our real estate properties, goodwill, and accrued liabilities. We base our estimates on historical experience, current market conditions, and various other assumptions that we believe to be reasonable under the circumstances. Actual results may vary from those estimates and those estimates could vary under different assumptions or conditions. |
Investments in Real Estate | Investments in Real Estate ā Real estate investments are carried at cost less accumulated depreciation and amortization. The cost of real estate includes the purchase price of property and leasehold improvements. Expenditures for maintenance and repairs are expensed as incurred. Significant renovations and betterments that extend the economic useful lives of assets are capitalized. During land development and construction periods, we capitalize construction costs, legal fees, financing costs, real estate taxes and insurance, rent expense and internal costs of personnel performing development, if such costs are incremental and identifiable to a specific development project. Capitalization of costs begins upon commencement of development efforts and ceases when the project is ready for its intended use and held available for occupancy. Interest is capitalized during the period of development based upon applying the weighted-average borrowing rate to the actual development costs expended. Capitalized interest costs were $3.5 million and $2.6 million for the three months ended March 31, 2020, and 2019, respectively. ā Depreciation and amortization are calculated using the straight-line method over the following useful lives of the assets: ā ā ā ā Buildings 27 to 40 years Building improvements ā 1 to 10 years Leasehold improvements ā The shorter of the lease term or useful life of the asset ā Depreciation expense was $36.9 million and $32.2 million for the three months ended March 31, 2020, and 2019, respectively. |
Acquisition of Investment in Real Estate | Acquisition of Investment in Real Estate ā When accounting for business combinations and asset acquisitions, the fair value of the real estate acquired is allocated to the acquired tangible assets, consisting primarily of land, building and building improvements, and identified intangible assets and liabilities, consisting of the value of above-market and below-market leases, value of in-place leases and the value of customer relationships. The primary difference between business combinations and asset acquisitions is that asset acquisitions require cost accumulation and allocation at a relative fair value. Acquisition costs are capitalized for asset acquisitions and are expensed for business combinations. ā The fair value of the land and building of an acquired property is determined by valuing the property as if it were vacant, and the āas-if-vacantā fair value is then allocated to land and building based on management's determination of the fair values of these assets. Management determines the as-if-vacant fair value of a property using methods similar to those used by independent appraisers. Factors considered by management in performing these analyses include an estimate of carrying costs during the expected lease-up periods considering current market conditions and costs to execute similar leases. ā The fair value of intangibles related to in-place leases includes the value of lease intangibles for above-market and below-market leases, lease origination costs, and customer relationships, determined on a lease-by-lease basis. Above-market and below-market leases are valued based on the present value (using an interest rate which reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to the in-place leases and (ii) management's estimate of market lease rates for the corresponding in-place leases, measured over a period equal to the remaining noncancelable term of the lease and, for below-market leases, over a time period equal to the initial term plus any below-market fixed rate renewal periods. Lease origination costs include estimates of costs avoided associated with leasing the property, including tenant allowances and improvements and leasing commissions. Customer relationship intangibles relate to the additional revenue opportunities expected to be generated through rental services, interconnection services, and utility services to be provided to the in-place lease tenants. ā The capitalized values for above and below-market lease intangibles, lease origination costs, and customer relationships are amortized over the term of the underlying leases or the expected customer relationship. Amortization related to above-market and below-market leases where the Company is the lessor is recorded as either a reduction of or an increase to rental revenue, amortization related to above-market and below-market leases where the Company is the lessee is recorded as either a reduction of or an increase to rent expense. If a lease is terminated prior to its stated expiration, all unamortized amounts relating to that lease are written off. ā The carrying value of intangible assets is reviewed for impairment in connection with its respective asset group whenever events or changes in circumstances indicate that the asset group may not be recoverable. An impairment loss is recognized if the carrying amount of the asset group is not recoverable and its carrying amount exceeds its estimated fair value. No impairment loss related to these intangible assets was recognized for the three months ended March 31, 2020, or 2019. ā The excess of the cost of an acquired business over the net of the amounts assigned to assets acquired (including identified intangible assets) and liabilities assumed is recorded as goodwill. As of March 31, 2020, and December 31, 2019, we had $40.6 million of goodwill at each date. The Companyās goodwill has an indeterminate life and is not amortized, but is tested for impairment on an annual basis, or more frequently if events or changes in circumstances indicate that the asset might be impaired. No impairment loss was recognized for the three months ended March 31, 2020, or 2019. |
Cash and Cash Equivalents | Cash and Cash Equivalents ā Cash and cash equivalents include all non-restricted cash held in financial institutions and other non-restricted highly liquid short-term investments with original maturities at acquisition of three months or less. |
Initial Direct Costs | Initial Direct Costs ā Initial direct costs include commissions paid to third parties, including brokers, leasing and referral agents, and internal sales commissions paid to employees for successful execution of lease agreements. Initial direct costs are incremental costs that would not have been incurred if the lease agreement had not been executed. These initial direct costs are capitalized and generally amortized over the term of the related leases using the straight-line method. If a customer lease terminates prior to the expiration of its initial term, any unamortized initial direct costs related to the lease are written off to amortization expense. Amortization of initial direct costs was $3.3 million and $3.4 million for the three months ended March 31, 2020, and 2019, respectively. Initial direct costs are included within other assets in the condensed consolidated balance sheets and consisted of the following, net of amortization, as of March 31, 2020, and December 31, 2019 (in thousands): ā ā ā ā ā ā ā ā ā ā ā March 31, ā December 31, ā ā 2020 2019 Internal sales commissions ā $ 15,335 ā $ 15,064 ā Third party commissions ā ā 12,820 ā ā 10,845 ā Other ā ā 436 ā ā 462 ā Total ā $ 28,591 ā $ 26,371 ā |
Deferred Financing Costs | Deferred Financing Costs ā Deferred financing costs include costs incurred in connection with obtaining debt and extending existing debt. These financing costs are capitalized and amortized on a straight-line basis, which approximates the effective-interest method, over the term of the indebtedness and the amortization is included as a component of interest expense. Depending on the type of debt instrument, deferred financing costs are reported either in other assets or as a direct deduction from the carrying amount of the related debt liabilities in our condensed consolidated balance sheets. |
Recoverability of Long-Lived Assets | Recoverability of Long-Lived Assets ā We review our long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Impairment is recognized when estimated expected future cash flows (undiscounted and without interest charges) are less than the carrying amount of the assets. The estimation of expected future net cash flows is inherently uncertain and relies, to a considerable extent, on assumptions regarding current and future economics and market conditions and the availability of capital. If, in future periods, there are changes in the estimates or assumptions incorporated into the impairment review analysis, the changes could result in an adjustment to the carrying amount of the long-lived assets. To the extent that impairment has occurred, the excess of the carrying amount of long-lived assets over its estimated fair value would be recognized as an impairment loss charged to net income. For the three months ended March 31, 2020, and 2019, no impairment of long-lived assets was recognized in the condensed consolidated financial statements. |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities ā We reflect all derivative instruments at fair value as either assets or liabilities on the condensed consolidated balance sheets. For those derivative instruments that are designated and qualify as hedging instruments, we record the gain or loss on the hedging instruments as a component of accumulated other comprehensive income or loss. For derivatives that do not meet the criteria for hedge accounting, changes in fair value are immediately recognized within net income. See additional discussion in Note 8, Derivatives and Hedging Activities. |
Internal-Use Software | Internal-Use Software ā We recognize internal-use software development costs based on the development stage of the project and nature of the cost. Internal and external costs incurred during the preliminary project stage are expensed as they are incurred. Internal and external costs incurred to develop internal-use software during the application development stage are capitalized. Internal and external training costs and maintenance costs during the post-implementation-operation stage are expensed as incurred. Completed projects are placed into service and amortized over the estimated useful life of the software. No impairment of internal-use software was recognized in the condensed consolidated financial statements for the three months ended March 31, 2020, and 2019. |
Revenue Recognition | Revenue Recognition ā Rental, Power, and Related Revenue ā We derive our revenues from leases with customers for data center and office and light-industrial space. Our leases include rental revenue lease components and nonlease revenue components, such as power and tenant reimbursements. We have elected to combine all of our nonlease revenue components that have the same pattern of transfer as the related operating lease component into a single combined lease component. ā Our leases with customers are classified as operating leases and rental revenue is recognized on a straight-line basis over the customer lease term. Occasionally, our customer leases include options to extend or terminate the lease agreements. We do not include any of these extension or termination options in a customerās lease term for lease classification purposes or for recognizing rental revenue unless we are reasonably certain the customer will exercise these extension or termination options. The excess of rents recognized over amounts contractually due pursuant to the underlying leases is recorded as deferred rent receivable within other assets on our condensed consolidated balance sheets. ā In general, we provide two power products for our data center leased space, consisting of a fixed (breakered-amperage) and a variable (sub-metered) model. Customer power arrangements are coterminous with the customerās underlying lease and have the same pattern of transfer over the lease term and are therefore combined with lease revenue within our condensed consolidated statements of operations. For fixed power arrangements, a customer pays us a fixed monthly fee for a committed available amount of power. We recognize the fixed power revenue each month over the term of the lease. For variable power arrangements, a customer pays us variable monthly fees for the specific amount of power utilized at the current utility rates. We recognize variable power revenue each month as the uncertainty related to the consideration is resolved, as power is provided to our customers, and as our customers utilize the power. ā Some of our leases contain provisions under which our customers reimburse us for common area maintenance and other executory costs. These customer reimbursements are variable and are recognized in the period that the expenses are recognized. These services have the same pattern of transfer over the lease term and are also combined with lease revenue within our condensed consolidated statements of operations. ā Interconnection Revenue ā We also derive revenue from interconnection services, which are generally contracted on a month-to-month basis cancellable by us or the customer at any time. Interconnection services are accounted for as separate contracts and are not combined with lease and power arrangements. We recognize interconnection revenue each month as these services are delivered to, and utilized by, our customers. ā Allowance for Doubtful Accounts ā A provision for uncollectible accounts is recorded if the collectability of a receivable balance relating to contractual rent, rental revenue recorded on a straight-line basis, tenant reimbursements or other billed amounts is considered by management to not be probable. At March 31, 2020, and December 31, 2019, the allowance for doubtful accounts totaled $0.9 million and $0.4 million, respectively, on the condensed consolidated balance sheets. |
Lessee Accounting | Lessee Accounting We determine if an arrangement is a lease at inception. Our operating lease agreements are primarily for real estate space and are included within operating lease right-of-use (āROUā) assets and operating lease liabilities on the condensed consolidated balance sheets. We elected the practical expedient to combine our lease and related nonlease components for our lessee building leases. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. Our variable lease payments consist of nonlease services related to the lease. Variable lease payments are excluded from the ROU assets and lease liabilities and are recognized in the period in which the obligation for those payments is incurred. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. ROU assets also include any lease payments made and exclude lease incentives. Many of our lessee agreements include options to extend the lease, which we do not include in our minimum lease terms unless they are reasonably certain to be exercised. Rental expense for lease payments related to operating leases is recognized on a straight-line basis over the lease term. |
Share-Based Compensation | Share-Based Compensation ā We account for share-based compensation using the fair value method of accounting. The estimated fair value of the stock options granted by us is calculated based on the Black-Scholes option-pricing model. The fair value of restricted share-based and Operating Partnership unit compensation is based on the fair value of our common stock on the date of the grant. The fair value of performance share awards, which have a market condition, is based on a Monte Carlo simulation. The fair value for all share-based compensation is amortized on a straight-line basis over the vesting period. We have elected to account for forfeitures as they occur. |
Asset Retirement and Environmental Remediation Obligations | Asset Retirement and Environmental Remediation Obligations ā We record accruals for estimated asset retirement and environmental remediation obligations. The obligations relate primarily to the removal of asbestos during development of properties as well as the estimated equipment removal costs upon termination of a certain lease where we are the lessee. At March 31, 2020, and December 31, 2019, the amount included in unearned revenue, prepaid rent and other liabilities on the condensed consolidated balance sheets was approximately $1.7 million at each date. |
Income Taxes | Income Taxes ā We elected to be taxed as a REIT under the Internal Revenue Code of 1986, as amended (the āCodeā), commencing with our taxable year ended December 31, 2010. To qualify as a REIT, we are required to distribute at least 90% of our taxable income to our stockholders and meet various other requirements imposed by the Code relating to such matters as operating results, asset holdings, distribution levels and diversity of stock ownership. Provided we qualify for taxation as a REIT, we generally are not subject to corporate level federal income tax on the earnings distributed currently to our stockholders. If we fail to qualify as a REIT in any taxable year, and are unable to avail ourselves of certain savings provisions set forth in the Code, all of our taxable income would be subject to federal income tax at regular corporate rates. ā To maintain REIT status, we must distribute a minimum of 90% of our taxable income. However, it is our policy and intent, subject to change, to distribute 100% of our taxable income and therefore, no provision is required in the accompanying condensed consolidated financial statements for federal income taxes with regard to our activities and our subsidiary pass-through entities. The allocable share of taxable income is included in the income tax returns of its stockholders. We are subject to the statutory requirements of the locations in which we conduct business. State and local income taxes are accrued as deemed required in the best judgment of management based on analysis and interpretation of respective tax laws. ā We have elected to treat certain subsidiaries as taxable REIT subsidiaries (āTRSā). Certain activities that we undertake must be conducted by a TRS, such as services for our tenants that could be considered otherwise impermissible for us to perform and holding assets that we cannot hold directly. A TRS is subject to corporate level federal and state income taxes. Deferred income taxes are recognized in certain taxable entities. Deferred income tax generally is a function of the periodās temporary differences (items that are treated differently for tax purposes than for financial reporting purposes), the utilization of tax net operating losses generated in prior years that previously had been recognized as deferred income tax assets and the reversal of any previously recorded deferred income tax liabilities. A valuation allowance for deferred income tax assets is provided if we believe all or some portion of the deferred income tax asset may more likely than not be realized. Any increase or decrease in the valuation allowance resulting from a change in circumstances that causes a change in the estimated realizability of the related deferred income tax asset is included in deferred tax expense. As of March 31, 2020, and December 31, 2019, the gross deferred income taxes were not material. ā We currently have no liabilities for uncertain income tax positions. The earliest tax year for which we are subject to examination is 2016. |
Concentration of Credit Risks | Concentration of Credit Risks ā Our cash and cash equivalents are maintained in various financial institutions, which, at times, may exceed federally insured limits. We have not experienced any losses in such accounts, and management believes that the Company is not exposed to any significant credit risk in this area. We have no off-balance sheet concentrations of credit risk, such as foreign exchange contracts, option contracts, or foreign currency hedging arrangements. |
Segment Information | Segment Information ā We manage our business as one reportable segment consisting of investments in data centers located in the United States. Although we provide services in several markets, these operations have been aggregated into one reportable segment based on the similar economic characteristics amongst all markets, including the nature of the services provided and the type of customers purchasing these services. |
Risks and Uncertainties | Risks and Uncertainties ā The full extent of the operational and financial impact of the novel coronavirus (āCOVID-19ā) outbreak on our business has yet to be determined. The impact of the outbreak of COVID-19 is dependent on future developments, including, among other factors, the duration and spread of the outbreak, along with related government-mandated business shutdowns, travel advisories and restrictions on movement, the recovery time of general employment levels, disrupted supply chains, potentially material staffing shortages, construction and development delays, and uncertainty with respect to accessibility of additional funding sources. In addition, some of our customers and prospective customers are dependent on areas of the economy that have been significantly impacted by the outbreak of COVID-19, which may impact their ability to comply with their rent obligations or their demand for additional space and power from us. As of March 31, 2020, we have not recognized a material loss, impairment, or contingency within our condensed consolidated financial statements as a result of the COVID-19 pandemic. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Summary of Significant Accounting Policies | |
Schedule of useful lives of real estate investment assets | ā ā ā ā Buildings 27 to 40 years Building improvements ā 1 to 10 years Leasehold improvements ā The shorter of the lease term or useful life of the asset |
Schedule of deferred leasing costs, net of amortization | ā ā ā ā ā ā ā ā ā ā ā March 31, ā December 31, ā ā 2020 2019 Internal sales commissions ā $ 15,335 ā $ 15,064 ā Third party commissions ā ā 12,820 ā ā 10,845 ā Other ā ā 436 ā ā 462 ā Total ā $ 28,591 ā $ 26,371 ā |
Investment in Real Estate (Tabl
Investment in Real Estate (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Investment in Real Estate | |
Summary of properties owned or leased | The following is a summary of the properties owned or leased by market at March 31, 2020 (in thousands): ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Buildings and ā Construction in ā ā ā ā Market Land Improvements Progress Total Cost Boston ā $ 5,154 ā $ 119,803 ā $ 3,005 ā $ 127,962 ā Chicago ā ā 5,493 ā ā 115,909 ā ā 110,768 ā ā 232,170 ā Denver ā ā ā ā ā 34,938 ā ā 386 ā ā 35,324 ā Los Angeles ā ā 18,672 ā ā 377,134 ā ā 81,178 ā ā 476,984 ā Miami ā ā 728 ā ā 14,641 ā ā ā ā ā 15,369 ā New York ā ā 2,729 ā ā 173,080 ā ā 54,719 ā ā 230,528 ā Northern Virginia ā ā 21,856 ā ā 401,645 ā ā 101,718 ā ā 525,219 ā San Francisco Bay ā ā 39,961 ā ā 778,380 ā ā 86,020 ā ā 904,361 ā Total ā $ 94,593 ā $ 2,015,530 ā $ 437,794 ā $ 2,547,917 ā ā ā ā The following is a summary of the properties owned or leased by market at December 31, 2019 (in thousands): ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Market Land Buildings and Construction in Total Cost ā Boston ā $ 5,154 ā $ 119,227 ā $ 931 ā $ 125,312 ā Chicago ā ā 5,493 ā ā 115,699 ā ā 100,118 ā ā 221,310 ā Denver ā ā ā ā ā 32,659 ā ā 2,461 ā ā 35,120 ā Los Angeles ā ā 18,672 ā ā 376,525 ā ā 60,178 ā ā 455,375 ā Miami ā ā 728 ā ā 14,491 ā ā 133 ā ā 15,352 ā New York ā ā 2,729 ā ā 155,746 ā ā 56,271 ā ā 214,746 ā Northern Virginia ā ā 21,856 ā ā 398,742 ā ā 101,619 ā ā 522,217 ā San Francisco Bay ā ā 39,961 ā ā 776,642 ā ā 72,763 ā ā 889,366 ā Total ā $ 94,593 ā $ 1,989,731 ā $ 394,474 ā $ 2,478,798 ā |
Other Assets (Tables)
Other Assets (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Other Assets. | |
Schedule of other assets | Other assets consisted of the following, net of amortization and depreciation, if applicable for each line item, as of March 31, 2020, and December 31, 2019 (in thousands): ā ā ā ā ā ā ā ā ā ā ā March 31, ā December 31, ā ā 2020 2019 Deferred rent receivable ā $ 38,831 ā $ 38,335 ā Initial direct costs ā ā 28,591 ā ā 26,371 ā Internal-use software ā ā 16,699 ā ā 16,747 ā Prepaid expenses ā ā 12,178 ā ā 7,675 ā Corporate furniture, fixtures and equipment ā ā 4,507 ā ā 4,848 ā Deferred financing costs - revolving credit facility ā ā 3,076 ā ā 3,148 ā Other ā ā 673 ā ā 3,958 ā Total ā $ 104,555 ā $ 101,082 ā |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Leases | |
Schedule of components of lease expense | The components of lease expense were as follows (in thousands): ā ā ā ā ā ā ā ā ā ā ā ā Three Months Ended March 31, ā ā ā ā 2020 ā 2019 ā ā Lease expense: ā ā ā ā ā ā ā ā Operating lease expense ā $ 6,862 ā $ 6,396 ā ā Variable lease expense ā ā 1,537 ā ā 1,292 ā ā Rent expense ā $ 8,399 ā $ 7,688 ā ā ā |
Lease Revenue (Tables)
Lease Revenue (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Lease Revenue | |
Components of data center, office, light-industrial, and other lease revenue | The components of data center, office, light-industrial, and other lease revenue were as follows (in thousands): ā ā ā ā ā ā ā ā ā ā ā ā Three Months Ended March 31, ā ā ā ā 2020 ā 2019 ā ā Lease revenue: ā ā ā ā ā ā ā ā Minimum lease revenue ā $ 106,441 ā $ 99,410 ā ā Variable lease revenue ā ā 20,836 ā ā 21,069 ā ā Total lease revenue ā $ 127,277 ā $ 120,479 ā ā |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Debt | |
Summary of outstanding indebtedness | A summary of outstanding indebtedness as of March 31, 2020, and December 31, 2019, is as follows (in thousands): ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Maturity ā March 31, ā December 31, ā ā Interest Rate Date 2020 2019 Revolving credit facility (1) ā 2.45% and 3.01% at March 31, 2020, and December 31, 2019, respectively ā November 8, 2023 ā $ 155,500 ā $ 62,500 ā 2022 Senior unsecured term loan (1) ā 1.76% and 2.96% at March 31, 2020, and December 31, 2019, respectively ā April 19, 2022 ā ā 200,000 ā ā 200,000 ā 2023 Senior unsecured notes ā 4.19% at March 31, 2020, and December 31, 2019, respectively ā June 15, 2023 ā ā 150,000 ā ā 150,000 ā 2024 Senior unsecured term loan (1) ā 2.86% and 3.44% at March 31, 2020, and December 31, 2019, respectively ā April 19, 2024 ā ā 150,000 ā ā 150,000 ā 2024 Senior unsecured notes ā 3.91% at March 31, 2020, and December 31, 2019, respectively ā April 20, 2024 ā ā 175,000 ā ā 175,000 ā 2025 Senior unsecured term loan (1) ā 2.32% and 2.81% at March 31, 2020, and December 31, 2019, respectively ā April 1, 2025 ā ā 350,000 ā ā 350,000 ā 2026 Senior unsecured notes (1) ā 4.52% at March 31, 2020, and December 31, 2019, respectively ā April 17, 2026 ā ā 200,000 ā ā 200,000 ā 2029 Senior unsecured notes ā 4.31% at March 31, 2020, and December 31, 2019, respectively ā April 17, 2029 ā ā 200,000 ā ā 200,000 ā Total principal outstanding ā ā ā ` ā ā 1,580,500 ā ā 1,487,500 ā Unamortized deferred financing costs ā ā ā ā ā ā (8,493) ā ā (9,098) ā Total debt ā ā ā ā ā $ 1,572,007 ā $ 1,478,402 ā (1) Our Operating Partnership has in place swap agreements with respect to the term loans noted above. The interest rates presented represent the effective interest rates as of March 31, 2020, and December 31, 2019, including the impact of the interest rate swaps, which effectively fix the interest rate on a portion of our variable rate debt. We entered into three new interest rate swaps during the quarter ended March 31, 2020. See Note 8 ā Derivatives and Hedging Activities. ā |
Summary of amount of the entity's outstanding debt when such debt currently become due | The following table summarizes when our debt currently becomes due (in thousands): ā ā ā ā ā ā Year Ending December 31, ā ā 2020 ā $ ā ā 2021 ā ā ā ā 2022 ā ā 200,000 ā 2023 ā ā 305,500 ā 2024 ā ā 325,000 ā Thereafter ā ā 750,000 ā Total principal outstanding ā ā 1,580,500 ā Unamortized deferred financing costs ā ā (8,493) ā Total debt, net ā $ 1,572,007 ā ā ā |
Derivatives and Hedging Activ_2
Derivatives and Hedging Activities (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Derivatives and Hedging Activities | |
Schedule of derivative instruments | The following table summarizes our derivative positions as of March 31, 2020, and December 31, 2019 (in thousands): ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Notional Amount ā ā ā ā ā ā ā ā ā ā ā ā Fair Value (Level 2) (1) ā March 31, ā December 31, ā Type of ā ā ā ā ā ā Effective ā Expiration ā March 31, ā December 31, ā 2020 ā 2019 ā Derivative ā Index ā Strike Rate ā ā Date ā Date ā 2020 ā 2019 ā $ 75,000 ā $ 75,000 ā Interest Rate Swap ā 1 mo. LIBOR ā 1.43 % ā 5/5/2015 ā 5/5/2020 ā $ (30) ā $ 67 ā ā 75,000 ā ā 75,000 ā Interest Rate Swap ā 1 mo. LIBOR ā 2.72 ā ā 5/5/2018 ā 4/5/2023 ā ā (5,469) ā ā (2,819) ā ā 100,000 ā ā 100,000 ā Interest Rate Swap ā 1 mo. LIBOR ā 1.59 ā ā 11/8/2019 ā 4/1/2025 ā ā (5,918) ā ā 55 ā ā 75,000 ā ā 75,000 ā Interest Rate Swap ā 1 mo. LIBOR ā 1.59 ā ā 11/8/2019 ā 4/1/2025 ā ā (4,439) ā ā 41 ā ā 200,000 ā ā ā ā Interest Rate Swap ā 1 mo. LIBOR ā 0.56 ā ā 3/5/2020 ā 4/19/2022 ā ā (1,104) ā ā ā ā ā 75,000 ā ā ā ā Interest Rate Swap ā 1 mo. LIBOR ā 0.61 ā ā 3/5/2020 ā 10/5/2023 ā ā (738) ā ā ā ā ā 175,000 ā ā ā ā Interest Rate Swap ā 1 mo. LIBOR ā 0.64 ā ā 3/5/2020 ā 10/1/2024 ā ā (2,075) ā ā ā ā $ 775,000 ā $ 325,000 ā ā ā ā ā ā ā ā ā ā ā ā $ (19,773) ā $ (2,656) ā (1) Derivative assets are recorded at fair value in our condensed consolidated balance sheets in other assets and derivative liabilities are recorded at fair value in our condensed consolidated balance sheets in unearned revenue, prepaid rent and other liabilities. We do not net our derivative position by counterparty for purposes of balance sheet presentation and disclosure. |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Stockholders' Equity | |
Schedule of dividends paid per share on Series A Cumulative Preferred Stock and common shares | We announced the following dividends per share on our common stock during the three months ended March 31, 2020: ā ā ā ā ā ā ā ā ā ā Declaration Date Record Date Payment Date Common Stock March 5, 2020 ā March 31, 2020 ā April 15, 2020 ā $ 1.22 ā |
Noncontrolling Interests - Op_2
Noncontrolling Interests - Operating Partnership (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Noncontrolling Interests - Operating Partnership | |
Schedule of ownership interests in our Operating Partnership | ā ā ā ā ā ā ā ā ā ā ā ā ā March 31, 2020 ā December 31, 2019 ā ā Number of Units Percentage of Total ā Number of Units Percentage of Total ā CoreSite Realty Corporation ā 37,394,352 ā 77.6 % 37,244,987 ā 77.6 % Noncontrolling interests ā 10,769,518 ā 22.4 ā 10,771,658 ā 22.4 ā Total ā 48,163,870 ā 100.0 % 48,016,645 ā 100.0 % |
Equity Incentive Award Plan (Ta
Equity Incentive Award Plan (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Equity Incentive Award Plan | |
Schedule of stock option activity | ā ā ā ā ā ā ā ā ā ā Number of ā ā ā ā ā Shares ā Weighted- ā ā ā Subject to ā Average ā ā ā Option ā Exercise Price ā Options outstanding, December 31, 2019 31,746 $ 19.57 Granted ā ā ā ā ā ā Exercised ā (3,210) ā ā 18.87 ā Forfeited ā ā ā ā ā ā Expired ā ā ā ā ā ā Options outstanding, March 31, 2020 ā 28,536 ā $ 19.65 ā ā |
Schedule of restricted awards and RSUs | ā ā ā ā ā ā ā ā ā ā Restricted ā Weighted- ā ā ā Stock ā Average Fair ā ā ā Awards and ā Value at Grant ā ā Units Date ā Unvested balance, December 31, 2019 ā 292,373 ā $ 96.44 ā Granted ā 146,582 ā ā 110.73 ā Forfeited ā (4,913) ā ā 99.04 ā Vested ā (112,245) ā ā 90.76 ā Unvested balance, March 31, 2020 ā 321,797 ā $ 104.90 ā |
Schedule of unvested PSAs and their weighted-average fair value at the date of grant | ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Weighted- ā ā ā ā ā ā ā Average Fair ā ā ā Performance-Based Restricted Stock Awards ā Value at Grant ā ā Minimum ā Maximum Target Date Unvested balance, December 31, 2019 ā 34,624 ā 171,351 ā 102,989 ā $ 107.84 ā Granted ā 10,210 ā 71,488 ā 40,852 ā ā 125.02 ā Performance adjustment (1) ā 38,047 ā (7,904) ā 15,073 ā ā ā ā Forfeited ā (1,049) ā (4,878) ā (2,964) ā ā 107.63 ā Vested ā (32,524) ā (32,524) ā (32,524) ā ā 105.55 ā Unvested balance, March 31, 2020 ā 49,308 ā 197,533 ā 123,426 ā $ 113.96 ā (1) Includes the annual adjustment for the number of PSAs earned based on our achievement of relative TSR measured versus the MSCI US REIT Index for the applicable performance periods. |
Summary of assumptions used to value stock option awards | ā ā ā ā ā ā ā ā ā Three Months Ended March 31, ā ā 2020 ā 2019 ā Expected term (in years) ā 2.82 ā 2.82 ā Expected volatility ā 24.00 % 24.09 % Expected annual dividend (1) ā ā ā ā ā Risk-free rate ā 0.56 % 2.48 % (1) The fair value of the PSAs assumes reinvestment of dividends. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share | |
Summary of basic and diluted income per share | ā The following is a summary of basic and diluted net income per share (in thousands, except share and per share amounts): ā ā ā ā ā ā ā ā ā ā ā Three Months Ended March 31, ā ā 2020 2019 Net income attributable to common shares ā $ 17,848 ā $ 19,661 ā Weighted-average common shares outstanding - basic ā ā 37,335,892 ā ā 36,347,781 ā Effect of potentially dilutive common shares: ā ā ā ā ā ā ā Stock options ā ā 25,298 ā ā 38,921 ā Unvested awards ā ā 143,159 ā ā 160,363 ā Weighted-average common shares outstanding - diluted ā ā 37,504,349 ā ā 36,547,065 ā Net income per share attributable to common shares ā ā ā ā ā ā ā Basic ā $ 0.48 ā $ 0.54 ā Diluted ā $ 0.48 ā $ 0.54 ā |
Organization and Description _2
Organization and Description of Business (Details) - Operating partnership | Mar. 31, 2020 | Dec. 31, 2019 |
Coresite Realty Corporation | ||
Organization | ||
Percentage of ownership interests held by the entity | 77.60% | 77.60% |
Noncontrolling interests | ||
Organization | ||
Percentage of ownership interests held by others | 22.40% | 22.40% |
Carlyle Group | ||
Organization | ||
Percentage of ownership interests held by others | 22.40% |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Real Estate (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Investments in Real Estate | ||
Capitalized interest costs | $ 3.5 | $ 2.6 |
Depreciation expense | $ 36.9 | $ 32.2 |
Building | Minimum | ||
Investments in Real Estate | ||
Useful lives | 27 years | |
Building | Maximum | ||
Investments in Real Estate | ||
Useful lives | 40 years | |
Building Improvements | Minimum | ||
Investments in Real Estate | ||
Useful lives | 1 year | |
Building Improvements | Maximum | ||
Investments in Real Estate | ||
Useful lives | 10 years |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Deferred Costs & Impairment (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Summary of Significant Accounting Policies | |||
Impairment loss related to intangible assets | $ 0 | $ 0 | |
Goodwill | 40,646 | $ 40,646 | |
Impairment loss related to goodwill | 0 | 0 | |
Deferred Costs | |||
Amortization of initial direct costs | 3,300 | 3,400 | |
Internal sales commissions | 15,335 | 15,064 | |
Third party commissions | 12,820 | 10,845 | |
Other | 436 | 462 | |
Total | 28,591 | $ 26,371 | |
Recoverability of Long-Lived Assets | |||
Impairment of long-lived assets | $ 0 | $ 0 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Internal Use Software, RR & IT (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Internal-Use Software | |||
Recognized impairment of internal use software | $ 0 | $ 0 | |
Operating revenues: | |||
Allowance for doubtful accounts (in dollars) | 904 | $ 371 | |
Asset Retirement and Environmental Remediation Obligations | |||
Asset retirement and environmental remediation obligations | $ 1,700 | $ 1,700 | |
Income taxes | |||
Minimum percentage of distribution of taxable income to qualify as REIT | 90.00% | ||
Percentage of distribution of taxable income as per company policy | 100.00% | ||
Provision for federal income taxes | $ 0 | ||
Liabilities for uncertain positions | $ 0 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Segment Information (Details) | 3 Months Ended |
Mar. 31, 2020segment | |
Segment information | |
Number of reportable segments | 1 |
Investment in Real Estate (Deta
Investment in Real Estate (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Investment in Real Estate | ||
Land | $ 94,593 | $ 94,593 |
Buildings and Improvements | 2,015,530 | 1,989,731 |
Construction in Progress | 437,794 | 394,474 |
Total investments in real estate | 2,547,917 | 2,478,798 |
Boston | ||
Investment in Real Estate | ||
Land | 5,154 | 5,154 |
Buildings and Improvements | 119,803 | 119,227 |
Construction in Progress | 3,005 | 931 |
Total investments in real estate | 127,962 | 125,312 |
Chicago | ||
Investment in Real Estate | ||
Land | 5,493 | 5,493 |
Buildings and Improvements | 115,909 | 115,699 |
Construction in Progress | 110,768 | 100,118 |
Total investments in real estate | 232,170 | 221,310 |
Denver | ||
Investment in Real Estate | ||
Buildings and Improvements | 34,938 | 32,659 |
Construction in Progress | 386 | 2,461 |
Total investments in real estate | 35,324 | 35,120 |
Los Angeles | ||
Investment in Real Estate | ||
Land | 18,672 | 18,672 |
Buildings and Improvements | 377,134 | 376,525 |
Construction in Progress | 81,178 | 60,178 |
Total investments in real estate | 476,984 | 455,375 |
Miami | ||
Investment in Real Estate | ||
Land | 728 | 728 |
Buildings and Improvements | 14,641 | 14,491 |
Construction in Progress | 133 | |
Total investments in real estate | 15,369 | 15,352 |
New York | ||
Investment in Real Estate | ||
Land | 2,729 | 2,729 |
Buildings and Improvements | 173,080 | 155,746 |
Construction in Progress | 54,719 | 56,271 |
Total investments in real estate | 230,528 | 214,746 |
Northern Virginia | ||
Investment in Real Estate | ||
Land | 21,856 | 21,856 |
Buildings and Improvements | 401,645 | 398,742 |
Construction in Progress | 101,718 | 101,619 |
Total investments in real estate | 525,219 | 522,217 |
San Francisco Bay | ||
Investment in Real Estate | ||
Land | 39,961 | 39,961 |
Buildings and Improvements | 778,380 | 776,642 |
Construction in Progress | 86,020 | 72,763 |
Total investments in real estate | $ 904,361 | $ 889,366 |
Other Assets (Details)
Other Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Other Assets. | ||
Deferred rent receivable | $ 38,831 | $ 38,335 |
Initial direct costs | 28,591 | 26,371 |
Internal-use software | 16,699 | 16,747 |
Prepaid expense | 12,178 | 7,675 |
Corporate furniture, fixtures and equipment | 4,507 | 4,848 |
Deferred financing costs - revolving credit facility | 3,076 | 3,148 |
Other | 673 | 3,958 |
Total | $ 104,555 | $ 101,082 |
Leases - (Detail)
Leases - (Detail) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020USD ($)ftĀ² | Mar. 31, 2019USD ($) | Dec. 31, 2019 | |
Lease terms | |||
Option to extend | 20 years | ||
Weighted-average remaining lease term | 9 years | 9 years | |
Weighted average discount rate - Operating leases | 4.90% | 4.90% | |
Increase in Right-of-Use Asset | $ 7,646 | ||
Increase in operating lease liability | 1,000 | ||
Lease expense | |||
Operating lease expense | 6,862 | $ 6,396 | |
Variable lease expense | 1,537 | 1,292 | |
Rent expense | $ 8,399 | $ 7,688 | |
Minimum | |||
Lease terms | |||
Remaining lease terms | 1 year | ||
Maximum | |||
Lease terms | |||
Remaining lease terms | 15 years | ||
DC2 Washington DC | |||
Lease terms | |||
Net Leased Space | ftĀ² | 25,000 | ||
Increase in Right-of-Use Asset | $ 7,000 |
Lease Revenue (Details)
Lease Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Components of lease revenue | ||
Minimum lease revenue | $ 106,441 | $ 99,410 |
Variable lease revenue | 20,836 | 21,069 |
Total lease revenue | $ 127,277 | $ 120,479 |
Debt - Summary of Debt (Details
Debt - Summary of Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | Nov. 08, 2019 | Apr. 17, 2019 |
Debt | ||||
Total principal outstanding | $ 1,580,500 | $ 1,487,500 | ||
Unamortized deferred financing costs | (8,493) | (9,098) | ||
Total debt | $ 1,572,007 | $ 1,478,402 | ||
Revolving Credit Facility | ||||
Debt | ||||
Interest rate as of reporting date (as a percent) | 2.45% | 3.01% | ||
Total principal outstanding | $ 155,500 | $ 62,500 | ||
2022 Senior Unsecured Term Loan | Senior Unsecured Term Loan | ||||
Debt | ||||
Interest rate as of reporting date (as a percent) | 1.76% | 2.96% | ||
Total principal outstanding | $ 200,000 | $ 200,000 | ||
Senior Unsecured Term Loan 2023 | Senior Unsecured Term Loan | ||||
Debt | ||||
Total principal outstanding | $ 150,000 | $ 150,000 | ||
2023 Senior unsecured notes | Senior Unsecured Term Loan | ||||
Debt | ||||
Interest rate as of reporting date (as a percent) | 2.86% | 3.44% | ||
2023 Senior unsecured notes | Senior Unsecured Notes | ||||
Debt | ||||
Interest rate as of reporting date (as a percent) | 4.19% | 4.19% | ||
Total principal outstanding | $ 150,000 | $ 150,000 | ||
2024 Senior unsecured notes | ||||
Debt | ||||
Interest rate as of reporting date (as a percent) | 3.91% | 3.91% | ||
2024 Senior unsecured notes | Senior Unsecured Notes | ||||
Debt | ||||
Total principal outstanding | $ 175,000 | $ 175,000 | ||
2025 Senior Unsecured Term Loan | Senior Unsecured Term Loan | ||||
Debt | ||||
Interest rate as of reporting date (as a percent) | 2.32% | 2.81% | ||
Total principal outstanding | $ 350,000 | $ 350,000 | ||
2026 Senior unsecured notes | ||||
Debt | ||||
Interest rate as of reporting date (as a percent) | 4.52% | |||
2026 Senior unsecured notes | Senior Unsecured Notes | ||||
Debt | ||||
Interest rate as of reporting date (as a percent) | 4.52% | |||
Total principal outstanding | $ 200,000 | 200,000 | ||
2029 Senior unsecured notes | Senior Unsecured Notes | ||||
Debt | ||||
Interest rate as of reporting date (as a percent) | 4.31% | |||
Total principal outstanding | $ 200,000 | $ 200,000 | ||
Operating partnership | 2020 Senior Unsecured Term Loan | Senior Unsecured Term Loan | ||||
Debt | ||||
Total principal outstanding | $ 150,000 | |||
Operating partnership | 2021 Senior Unsecured Term Loan | Senior Unsecured Term Loan | ||||
Debt | ||||
Total principal outstanding | 100,000 | |||
Operating partnership | 2024 Senior Unsecured Term Loan | Senior Unsecured Term Loan | ||||
Debt | ||||
Total principal outstanding | 150,000 | |||
Operating partnership | 2025 Senior Unsecured Term Loan | Senior Unsecured Term Loan | ||||
Debt | ||||
Total principal outstanding | $ 350,000 |
Debt - Revolving Credit Facilit
Debt - Revolving Credit Facility (Details) $ in Thousands | Apr. 15, 2020 | Nov. 08, 2019USD ($)item | Mar. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Nov. 07, 2019USD ($) | Apr. 19, 2017USD ($) |
Debt | ||||||
Total principal outstanding | $ 1,580,500 | $ 1,487,500 | ||||
Subsequent Event | ||||||
Debt | ||||||
Term of loan facility | 7 years | |||||
Revolving Credit Facility | ||||||
Debt | ||||||
Total principal outstanding | $ 155,500 | 62,500 | ||||
Credit Agreement | ||||||
Debt | ||||||
Leverage ratio (as a percent) | 31.20% | |||||
Secured debt ratio, Covenant (as a percent) | 0.00% | |||||
Fixed charge coverage ratio | 5.8 | |||||
Credit Agreement | Minimum | ||||||
Debt | ||||||
Fixed charge coverage ratio | 1.5 | |||||
Credit Agreement | Maximum | ||||||
Debt | ||||||
Leverage ratio (as a percent) | 0.60% | |||||
Secured debt ratio (as a percent) | 0.40% | |||||
2022 Senior Unsecured Term Loan | Senior Unsecured Term Loan | ||||||
Debt | ||||||
Total principal outstanding | $ 200,000 | 200,000 | ||||
2024 Senior Unsecured Term Loan | Senior Unsecured Term Loan | ||||||
Debt | ||||||
Unsecured term loan | $ 150,000 | |||||
2025 Senior Unsecured Term Loan | Senior Unsecured Term Loan | ||||||
Debt | ||||||
Total principal outstanding | 350,000 | $ 350,000 | ||||
Operating partnership | Revolving Credit Facility | ||||||
Debt | ||||||
Maximum borrowing capacity | $ 450,000 | |||||
Operating partnership | Credit Agreement | ||||||
Debt | ||||||
Number of options available for extensions | item | 1 | |||||
Extension fee (as a percent) | 10.00% | |||||
Additional liquidity | $ 100,000 | |||||
Maximum borrowing capacity | 950,000 | $ 850,000 | ||||
Increase in accordion feature borrowing capacity | 550,000 | 200,000 | ||||
Maximum borrowing capacity including accordion feature | 1,500,000 | $ 950,000 | ||||
Borrowing capacity at end of period | 450,000 | |||||
Letters of credit outstanding | 6,100 | |||||
Amount available for borrowing under the facility | $ 288,400 | |||||
Operating partnership | Credit Agreement | Revolving Credit Facility | ||||||
Debt | ||||||
Leverage ratio (as a percent) | 31.20% | |||||
Operating partnership | Credit Agreement | Revolving Credit Facility | LIBOR | ||||||
Debt | ||||||
Interest rate margin (as a percent) | 1.25% | |||||
Operating partnership | Credit Agreement | Revolving Credit Facility | LIBOR | Minimum | ||||||
Debt | ||||||
Interest rate margin (as a percent) | 1.25% | |||||
Operating partnership | Credit Agreement | Revolving Credit Facility | LIBOR | Maximum | ||||||
Debt | ||||||
Interest rate margin (as a percent) | 1.85% | |||||
Operating partnership | Credit Agreement | Revolving Credit Facility | Base Rate | Minimum | ||||||
Debt | ||||||
Interest rate margin (as a percent) | 0.25% | |||||
Operating partnership | Credit Agreement | Revolving Credit Facility | Base Rate | Maximum | ||||||
Debt | ||||||
Interest rate margin (as a percent) | 0.85% | |||||
Operating partnership | 2020 Senior Unsecured Term Loan | Senior Unsecured Term Loan | ||||||
Debt | ||||||
Total principal outstanding | 150,000 | |||||
Operating partnership | 2021 Senior Unsecured Term Loan | Senior Unsecured Term Loan | ||||||
Debt | ||||||
Total principal outstanding | 100,000 | |||||
Operating partnership | 2022 Senior Unsecured Term Loan | LIBOR | ||||||
Debt | ||||||
Interest rate margin (as a percent) | 1.20% | |||||
Operating partnership | 2022 Senior Unsecured Term Loan | LIBOR | Minimum | ||||||
Debt | ||||||
Interest rate margin (as a percent) | 1.20% | |||||
Operating partnership | 2022 Senior Unsecured Term Loan | LIBOR | Maximum | ||||||
Debt | ||||||
Interest rate margin (as a percent) | 1.80% | |||||
Operating partnership | 2022 Senior Unsecured Term Loan | Base Rate | Minimum | ||||||
Debt | ||||||
Interest rate margin (as a percent) | 0.20% | |||||
Operating partnership | 2022 Senior Unsecured Term Loan | Base Rate | Maximum | ||||||
Debt | ||||||
Interest rate margin (as a percent) | 0.80% | |||||
Operating partnership | 2022 Senior Unsecured Term Loan | Senior Unsecured Term Loan | ||||||
Debt | ||||||
Unsecured term loan | $ 100,000 | |||||
Increase in accordion feature borrowing capacity | $ 300,000 | |||||
Operating partnership | 2024 Senior Unsecured Term Loan | Senior Unsecured Term Loan | ||||||
Debt | ||||||
Total principal outstanding | $ 150,000 | |||||
Leverage ratio (as a percent) | 31.20% | |||||
Operating partnership | 2024 Senior Unsecured Term Loan | Senior Unsecured Term Loan | LIBOR | ||||||
Debt | ||||||
Interest rate margin (as a percent) | 1.20% | |||||
Operating partnership | 2024 Senior Unsecured Term Loan | Senior Unsecured Term Loan | LIBOR | Minimum | ||||||
Debt | ||||||
Interest rate margin (as a percent) | 1.20% | |||||
Operating partnership | 2024 Senior Unsecured Term Loan | Senior Unsecured Term Loan | LIBOR | Maximum | ||||||
Debt | ||||||
Interest rate margin (as a percent) | 1.80% | |||||
Operating partnership | 2024 Senior Unsecured Term Loan | Senior Unsecured Term Loan | Base Rate | Minimum | ||||||
Debt | ||||||
Interest rate margin (as a percent) | 20.00% | |||||
Operating partnership | 2024 Senior Unsecured Term Loan | Senior Unsecured Term Loan | Base Rate | Maximum | ||||||
Debt | ||||||
Interest rate margin (as a percent) | 0.80% | |||||
Operating partnership | 2025 Senior Unsecured Term Loan | Senior Unsecured Term Loan | ||||||
Debt | ||||||
Total principal outstanding | $ 350,000 | |||||
Unsecured term loan | $ 350,000 | |||||
Leverage ratio (as a percent) | 31.20% | |||||
Operating partnership | 2025 Senior Unsecured Term Loan | Senior Unsecured Term Loan | LIBOR | ||||||
Debt | ||||||
Interest rate margin (as a percent) | 1.20% | |||||
Operating partnership | 2025 Senior Unsecured Term Loan | Senior Unsecured Term Loan | LIBOR | Minimum | ||||||
Debt | ||||||
Interest rate margin (as a percent) | 1.20% | |||||
Operating partnership | 2025 Senior Unsecured Term Loan | Senior Unsecured Term Loan | LIBOR | Maximum | ||||||
Debt | ||||||
Interest rate margin (as a percent) | 1.80% | |||||
Operating partnership | 2025 Senior Unsecured Term Loan | Senior Unsecured Term Loan | Base Rate | Minimum | ||||||
Debt | ||||||
Interest rate margin (as a percent) | 0.20% | |||||
Operating partnership | 2025 Senior Unsecured Term Loan | Senior Unsecured Term Loan | Base Rate | Maximum | ||||||
Debt | ||||||
Interest rate margin (as a percent) | 0.80% |
Debt - Unsecured Debt (Details)
Debt - Unsecured Debt (Details) - USD ($) $ in Thousands | Apr. 15, 2020 | Nov. 08, 2019 | Mar. 31, 2020 | Jul. 14, 2020 | May 06, 2020 | Dec. 31, 2019 | Jul. 17, 2019 | Apr. 17, 2019 | Apr. 20, 2017 | Apr. 19, 2017 | Jun. 15, 2016 |
Debt | |||||||||||
Total principal outstanding | $ 1,580,500 | $ 1,487,500 | |||||||||
Subsequent Event | |||||||||||
Debt | |||||||||||
Term of loan facility | 7 years | ||||||||||
Aggregate principal amount | $ 150,000 | $ 50,000 | $ 100,000 | ||||||||
2022 Senior Unsecured Term Loan | Senior Unsecured Term Loan | |||||||||||
Debt | |||||||||||
Total principal outstanding | $ 200,000 | $ 200,000 | |||||||||
Effective interest rate | 1.76% | 2.96% | |||||||||
2024 Senior Unsecured Term Loan | Senior Unsecured Term Loan | |||||||||||
Debt | |||||||||||
Unsecured term loan | $ 150,000 | ||||||||||
2025 Senior Unsecured Term Loan | Senior Unsecured Term Loan | |||||||||||
Debt | |||||||||||
Total principal outstanding | $ 350,000 | $ 350,000 | |||||||||
Effective interest rate | 2.32% | 2.81% | |||||||||
2023 Senior unsecured notes | Senior Unsecured Term Loan | |||||||||||
Debt | |||||||||||
Effective interest rate | 2.86% | 3.44% | |||||||||
2023 Senior unsecured notes | Senior Unsecured Notes | |||||||||||
Debt | |||||||||||
Total principal outstanding | $ 150,000 | $ 150,000 | |||||||||
Effective interest rate | 4.19% | 4.19% | |||||||||
2024 Senior unsecured notes | |||||||||||
Debt | |||||||||||
Effective interest rate | 3.91% | 3.91% | |||||||||
2024 Senior unsecured notes | Senior Unsecured Notes | |||||||||||
Debt | |||||||||||
Total principal outstanding | $ 175,000 | $ 175,000 | |||||||||
2026 Senior unsecured notes | |||||||||||
Debt | |||||||||||
Effective interest rate | 4.52% | ||||||||||
2026 Senior unsecured notes | Senior Unsecured Term Loan | |||||||||||
Debt | |||||||||||
Unsecured term loan | $ 200,000 | ||||||||||
2026 Senior unsecured notes | Senior Unsecured Notes | |||||||||||
Debt | |||||||||||
Total principal outstanding | $ 200,000 | 200,000 | |||||||||
Effective interest rate | 4.52% | ||||||||||
2029 Senior unsecured notes | Senior Unsecured Term Loan | |||||||||||
Debt | |||||||||||
Unsecured term loan | $ 75,000 | ||||||||||
2029 Senior unsecured notes | Senior Unsecured Notes | |||||||||||
Debt | |||||||||||
Total principal outstanding | $ 200,000 | $ 200,000 | |||||||||
Effective interest rate | 4.31% | ||||||||||
Operating partnership | 2020 Senior Unsecured Term Loan | Senior Unsecured Term Loan | |||||||||||
Debt | |||||||||||
Total principal outstanding | 150,000 | ||||||||||
Operating partnership | 2021 Senior Unsecured Term Loan | Senior Unsecured Term Loan | |||||||||||
Debt | |||||||||||
Total principal outstanding | 100,000 | ||||||||||
Operating partnership | 2022 Senior Unsecured Term Loan | LIBOR | |||||||||||
Debt | |||||||||||
Interest rate margin (as a percent) | 1.20% | ||||||||||
Operating partnership | 2022 Senior Unsecured Term Loan | LIBOR | Minimum | |||||||||||
Debt | |||||||||||
Interest rate margin (as a percent) | 1.20% | ||||||||||
Operating partnership | 2022 Senior Unsecured Term Loan | LIBOR | Maximum | |||||||||||
Debt | |||||||||||
Interest rate margin (as a percent) | 1.80% | ||||||||||
Operating partnership | 2022 Senior Unsecured Term Loan | Base Rate | Minimum | |||||||||||
Debt | |||||||||||
Interest rate margin (as a percent) | 0.20% | ||||||||||
Operating partnership | 2022 Senior Unsecured Term Loan | Base Rate | Maximum | |||||||||||
Debt | |||||||||||
Interest rate margin (as a percent) | 0.80% | ||||||||||
Operating partnership | 2022 Senior Unsecured Term Loan | Senior Unsecured Term Loan | |||||||||||
Debt | |||||||||||
Unsecured term loan | $ 100,000 | ||||||||||
Increase in accordion feature borrowing capacity | 300,000 | ||||||||||
Aggregate principal amount | $ 200,000 | ||||||||||
Operating partnership | 2024 Senior Unsecured Term Loan | Senior Unsecured Term Loan | |||||||||||
Debt | |||||||||||
Total principal outstanding | $ 150,000 | ||||||||||
Leverage ratio (as a percent) | 31.20% | ||||||||||
Operating partnership | 2024 Senior Unsecured Term Loan | Senior Unsecured Term Loan | LIBOR | |||||||||||
Debt | |||||||||||
Interest rate margin (as a percent) | 1.20% | ||||||||||
Operating partnership | 2024 Senior Unsecured Term Loan | Senior Unsecured Term Loan | LIBOR | Minimum | |||||||||||
Debt | |||||||||||
Interest rate margin (as a percent) | 1.20% | ||||||||||
Operating partnership | 2024 Senior Unsecured Term Loan | Senior Unsecured Term Loan | LIBOR | Maximum | |||||||||||
Debt | |||||||||||
Interest rate margin (as a percent) | 1.80% | ||||||||||
Operating partnership | 2024 Senior Unsecured Term Loan | Senior Unsecured Term Loan | Base Rate | Minimum | |||||||||||
Debt | |||||||||||
Interest rate margin (as a percent) | 20.00% | ||||||||||
Operating partnership | 2024 Senior Unsecured Term Loan | Senior Unsecured Term Loan | Base Rate | Maximum | |||||||||||
Debt | |||||||||||
Interest rate margin (as a percent) | 0.80% | ||||||||||
Operating partnership | 2025 Senior Unsecured Term Loan | Senior Unsecured Term Loan | |||||||||||
Debt | |||||||||||
Total principal outstanding | $ 350,000 | ||||||||||
Unsecured term loan | $ 350,000 | ||||||||||
Leverage ratio (as a percent) | 31.20% | ||||||||||
Operating partnership | 2025 Senior Unsecured Term Loan | Senior Unsecured Term Loan | LIBOR | |||||||||||
Debt | |||||||||||
Interest rate margin (as a percent) | 1.20% | ||||||||||
Operating partnership | 2025 Senior Unsecured Term Loan | Senior Unsecured Term Loan | LIBOR | Minimum | |||||||||||
Debt | |||||||||||
Interest rate margin (as a percent) | 1.20% | ||||||||||
Operating partnership | 2025 Senior Unsecured Term Loan | Senior Unsecured Term Loan | LIBOR | Maximum | |||||||||||
Debt | |||||||||||
Interest rate margin (as a percent) | 1.80% | ||||||||||
Operating partnership | 2025 Senior Unsecured Term Loan | Senior Unsecured Term Loan | Base Rate | Minimum | |||||||||||
Debt | |||||||||||
Interest rate margin (as a percent) | 0.20% | ||||||||||
Operating partnership | 2025 Senior Unsecured Term Loan | Senior Unsecured Term Loan | Base Rate | Maximum | |||||||||||
Debt | |||||||||||
Interest rate margin (as a percent) | 0.80% | ||||||||||
Operating partnership | 2023 Senior unsecured notes | Senior Unsecured Notes | Private Placement | |||||||||||
Debt | |||||||||||
Aggregate principal amount | $ 150,000 | ||||||||||
Stated interest rate | 4.19% | ||||||||||
Percentage of term notes that may be prepaid | 100.00% | ||||||||||
Percentage of term notes that holders have right to purchase in cash | 100.00% | ||||||||||
Percentage of term notes that holders may redeem for cash | 100.00% | ||||||||||
Operating partnership | 2024 Senior unsecured notes | Senior Unsecured Term Loan | |||||||||||
Debt | |||||||||||
Unsecured term loan | $ 175,000 | ||||||||||
Stated interest rate | 3.91% | ||||||||||
Percentage of term notes that may be prepaid | 100.00% | ||||||||||
Percentage of term notes that holders have right to purchase in cash | 100.00% | ||||||||||
Percentage of term notes that holders may redeem for cash | 100.00% | ||||||||||
Operating partnership | 2026 Senior unsecured notes | Senior Unsecured Term Loan | |||||||||||
Debt | |||||||||||
Stated interest rate | 4.11% | ||||||||||
Operating partnership | 2026 Senior unsecured notes | Senior Unsecured Notes | |||||||||||
Debt | |||||||||||
Percentage of term notes that may be prepaid | 100.00% | ||||||||||
Percentage of term notes that holders have right to purchase in cash | 100.00% | ||||||||||
Percentage of term notes that holders may redeem for cash | 100.00% | ||||||||||
Operating partnership | 2029 Senior unsecured notes | Senior Unsecured Term Loan | |||||||||||
Debt | |||||||||||
Aggregate principal amount | $ 125,000 | ||||||||||
Operating partnership | 2029 Senior unsecured notes | Senior Unsecured Term Loan | Private Placement | |||||||||||
Debt | |||||||||||
Unsecured term loan | $ 200,000 | ||||||||||
Stated interest rate | 4.31% | ||||||||||
Operating partnership | 2029 Senior unsecured notes | Senior Unsecured Notes | |||||||||||
Debt | |||||||||||
Percentage of term notes that may be prepaid | 100.00% | ||||||||||
Percentage of term notes that holders have right to purchase in cash | 100.00% | ||||||||||
Percentage of term notes that holders may redeem for cash | 100.00% |
Debt - Maturities (Details)
Debt - Maturities (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Debt maturities | ||
2022 | $ 200,000 | |
2023 | 305,500 | |
2024 | 325,000 | |
Thereafter | 750,000 | |
Total principal outstanding | 1,580,500 | $ 1,487,500 |
Unamortized deferred financing costs | (8,493) | (9,098) |
Total debt | $ 1,572,007 | $ 1,478,402 |
Debt - Subsequent Debt Financin
Debt - Subsequent Debt Financing (Details) - Subsequent Event - USD ($) $ in Millions | Apr. 15, 2020 | Jul. 14, 2020 | May 06, 2020 |
Debt Instrument [Line Items] | |||
Debt Term | 7 years | ||
Aggregate principal amount | $ 150 | $ 50 | $ 100 |
Derivatives and Hedging Activ_3
Derivatives and Hedging Activities (Details) - USD ($) $ in Thousands | Apr. 15, 2020 | Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2021 | Jul. 14, 2020 | May 06, 2020 | Dec. 31, 2019 |
Derivative instruments and hedging activities disclosures | |||||||
Unrealized (loss) gain recorded in other comprehensive income | $ (17,028) | $ (4,466) | |||||
Interest expense | 11,183 | $ 9,498 | |||||
Subsequent Event | |||||||
Derivative instruments and hedging activities disclosures | |||||||
Debt face amount | $ 150,000 | $ 50,000 | $ 100,000 | ||||
Debt Term | 7 years | ||||||
Interest Rate Swap | Designated as Hedging Instrument | |||||||
Derivative instruments and hedging activities disclosures | |||||||
Notional Amount | 775,000 | $ 325,000 | |||||
Interest Rate Swap | Designated as Hedging Instrument | Cash Flow Hedging | Forecast | |||||||
Derivative instruments and hedging activities disclosures | |||||||
Amount estimated to be reclassified as an increase to interest expense | $ 6,000 | ||||||
Interest Rate Swap | Designated as Hedging Instrument | Level 2 | |||||||
Derivative instruments and hedging activities disclosures | |||||||
Fair Value | (19,773) | (2,656) | |||||
Interest rate swap expiring 5/20/2020 | Designated as Hedging Instrument | |||||||
Derivative instruments and hedging activities disclosures | |||||||
Notional Amount | $ 75,000 | 75,000 | |||||
Strike Rate | 1.43% | ||||||
Interest rate swap expiring 5/20/2020 | Designated as Hedging Instrument | Level 2 | |||||||
Derivative instruments and hedging activities disclosures | |||||||
Fair Value | $ (30) | 67 | |||||
Interest rate swap expiring 4/5/2023 | Designated as Hedging Instrument | |||||||
Derivative instruments and hedging activities disclosures | |||||||
Notional Amount | $ 75,000 | 75,000 | |||||
Strike Rate | 2.72% | ||||||
Interest rate swap expiring 4/5/2023 | Designated as Hedging Instrument | Level 2 | |||||||
Derivative instruments and hedging activities disclosures | |||||||
Fair Value | $ (5,469) | (2,819) | |||||
Interest rate swap expiring 4/1/2025 | Designated as Hedging Instrument | |||||||
Derivative instruments and hedging activities disclosures | |||||||
Notional Amount | $ 100,000 | 100,000 | |||||
Strike Rate | 1.59% | ||||||
Interest rate swap expiring 4/1/2025 | Designated as Hedging Instrument | Level 2 | |||||||
Derivative instruments and hedging activities disclosures | |||||||
Fair Value | $ (5,918) | 55 | |||||
Second interest rate swap expiring 4/1/2025 | Designated as Hedging Instrument | |||||||
Derivative instruments and hedging activities disclosures | |||||||
Notional Amount | $ 75,000 | 75,000 | |||||
Strike Rate | 1.59% | ||||||
Second interest rate swap expiring 4/1/2025 | Designated as Hedging Instrument | Level 2 | |||||||
Derivative instruments and hedging activities disclosures | |||||||
Fair Value | $ (4,439) | $ 41 | |||||
Interest rate swap expiring 4/19/2022 | Designated as Hedging Instrument | |||||||
Derivative instruments and hedging activities disclosures | |||||||
Notional Amount | $ 200,000 | ||||||
Strike Rate | 0.56% | ||||||
Interest rate swap expiring 4/19/2022 | Designated as Hedging Instrument | Level 2 | |||||||
Derivative instruments and hedging activities disclosures | |||||||
Fair Value | $ (1,104) | ||||||
Interest rate swap expiring 10/5/2023 | Designated as Hedging Instrument | |||||||
Derivative instruments and hedging activities disclosures | |||||||
Notional Amount | $ 75,000 | ||||||
Strike Rate | 0.61% | ||||||
Interest rate swap expiring 10/5/2023 | Designated as Hedging Instrument | Level 2 | |||||||
Derivative instruments and hedging activities disclosures | |||||||
Fair Value | $ (738) | ||||||
Interest rate swap expiring 10/12024 | Designated as Hedging Instrument | |||||||
Derivative instruments and hedging activities disclosures | |||||||
Notional Amount | $ 175,000 | ||||||
Strike Rate | 0.64% | ||||||
Interest rate swap expiring 10/12024 | Designated as Hedging Instrument | Level 2 | |||||||
Derivative instruments and hedging activities disclosures | |||||||
Fair Value | $ (2,075) |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - Common Stock | Mar. 05, 2020$ / shares |
Stockholders' Equity | |
Dividends Payable, Date of Record | Mar. 31, 2020 |
Common Stock dividend declared (per share) | $ 1.22 |
Noncontrolling Interests - Op_3
Noncontrolling Interests - Operating Partnership (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020USD ($)$ / sharesshares | Dec. 31, 2019shares | |
Noncontrolling Interests - Operating Partnership | ||
Redemption value of the noncontrolling interest | $ | $ 1,200,000 | |
Closing price of the Company's stock (in dollars per share) | $ / shares | $ 115.90 | |
Noncontrolling Interests | ||
Noncontrolling Interests - Operating Partnership | ||
Reduction to noncontrolling interests in the Operating Partnership and an increase to common stock and additional paid in capital | $ | $ 11 | |
Operating partnership | ||
Noncontrolling Interests - Operating Partnership | ||
Conversion ratio for common operating partnership units | 1 | |
Number of Operating Partnership Units (in shares) | 48,163,870 | 48,016,645 |
Percentage of Total | 100.00% | 100.00% |
Shares of common stock issued related to employee compensation arrangements | 149,365 | |
Quarterly distributions will receive by holders of operating partnership units (in dollars per unit) | $ / shares | $ 1.22 | |
Operating partnership | Coresite Realty Corporation | ||
Noncontrolling Interests - Operating Partnership | ||
Number of Operating Partnership Units (in shares) | 37,394,352 | 37,244,987 |
Percentage of Total | 77.60% | 77.60% |
Operating partnership | Noncontrolling interests | ||
Noncontrolling Interests - Operating Partnership | ||
Number of Operating Partnership Units (in shares) | 10,769,518 | 10,771,658 |
Percentage of Total | 22.40% | 22.40% |
Equity Incentive Plan (Details)
Equity Incentive Plan (Details) - 2010 Plan - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Equity Incentive Plan | ||
Shares of common stock reserved for issuance | 6,000,000 | |
Shares of common stock that were available for issuance | 2,474,370 | |
Stock Options | ||
Number of Shares Subject to Option | ||
Options outstanding at the beginning of the period (in shares) | 31,746 | |
Exercised (in shares) | (3,210) | |
Options outstanding at the end of the period (in shares) | 28,536 | |
Weighted Average Exercise Price | ||
Options outstanding at the beginning of the period (in dollars per share) | $ 19.57 | |
Exercised (in dollars per share) | 18.87 | |
Options outstanding at the end of the period (in dollars per share) | $ 19.65 | |
Restricted Awards | ||
Compensation cost not yet recognized | ||
Unearned compensation | $ 32 | |
Restricted Awards | Weighted Average | ||
Compensation cost not yet recognized | ||
Vesting period | 2 years 10 months 24 days | |
Restricted awards | ||
Restricted Awards and PSA's | ||
Unvested balance at the beginning of the period (in shares) | 292,373 | |
Granted (in shares) | 146,582 | |
Forfeited (in shares) | (4,913) | |
Vested (in shares) | (112,245) | |
Unvested balance at the end of the period (in shares) | 321,797 | |
Weighted Average Fair Value at Grant | ||
Unvested balance at the beginning of the period (in dollars per share) | $ 96.44 | |
Granted (in dollars per share) | 110.73 | |
Forfeited (in dollars per share) | 99.04 | |
Vested (in dollars per share) | 90.76 | |
Unvested balance at the end of the period (in dollars per share) | $ 104.90 | |
PSAs | ||
Compensation cost not yet recognized | ||
Unearned compensation | $ 9.6 | |
Assumptions used to value the stock options granted | ||
Expected term | 2 years 9 months 25 days | 2 years 9 months 25 days |
Expected volatility (as a percent) | 24.00% | 24.09% |
Risk-free rate (as a percent) | 0.56% | 2.48% |
Performance period | 3 years | |
PSAs | Weighted Average | ||
Weighted Average Fair Value at Grant | ||
Unvested balance at the beginning of the period (in dollars per share) | $ 107.84 | |
Granted (in dollars per share) | 125.02 | |
Forfeited (in dollars per share) | 107.63 | |
Vested (in dollars per share) | 105.55 | |
Unvested balance at the end of the period (in dollars per share) | $ 113.96 | |
Compensation cost not yet recognized | ||
Vesting period | 2 years 4 months 24 days | |
PSAs | Minimum | ||
Restricted Awards and PSA's | ||
Unvested balance at the beginning of the period (in shares) | 34,624 | |
Granted (in shares) | 10,210 | |
Performance adjustment | 38,047 | |
Forfeited (in shares) | (1,049) | |
Vested (in shares) | (32,524) | |
Unvested balance at the end of the period (in shares) | 49,308 | |
Compensation cost not yet recognized | ||
Percentage of target number of shares for PSAs granted in years 2015, 2016 and 2017 | 25.00% | |
Assumptions used to value the stock options granted | ||
Performance period | 1 year | |
PSAs | Maximum | ||
Restricted Awards and PSA's | ||
Unvested balance at the beginning of the period (in shares) | 171,351 | |
Granted (in shares) | 71,488 | |
Performance adjustment | (7,904) | |
Forfeited (in shares) | (4,878) | |
Vested (in shares) | (32,524) | |
Unvested balance at the end of the period (in shares) | 197,533 | |
Compensation cost not yet recognized | ||
Percentage of target number of shares for PSAs granted in years 2015, 2016 and 2017 | 175.00% | |
Assumptions used to value the stock options granted | ||
Performance period | 3 years | |
PSAs | Target | ||
Restricted Awards and PSA's | ||
Unvested balance at the beginning of the period (in shares) | 102,989 | |
Granted (in shares) | 40,852 | |
Performance adjustment | 15,073 | |
Forfeited (in shares) | (2,964) | |
Vested (in shares) | (32,524) | |
Unvested balance at the end of the period (in shares) | 123,426 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Earnings Per Share | ||
Net income attributable to common shares | $ 17,848 | $ 19,661 |
Weighted-average common shares outstanding - basic | 37,335,892 | 36,347,781 |
Effect of potentially dilutive common shares: | ||
Weighted-average common shares outstanding - diluted | 37,504,349 | 36,547,065 |
Net income per share attributable to common shares | ||
Basic | $ 0.48 | $ 0.54 |
Diluted | $ 0.48 | $ 0.54 |
Weighted-average potentially dilutive securities excluded in calculation of basic and diluted income (loss) per share | 2,054 | 39,754 |
Stock Options | ||
Effect of potentially dilutive common shares: | ||
Potentially dilutive common shares | 25,298 | 38,921 |
Restricted awards | ||
Effect of potentially dilutive common shares: | ||
Potentially dilutive common shares | 143,159 | 160,363 |
Estimated Fair Value of Finan_2
Estimated Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Estimated Fair Value of Financial Instruments | ||
Total principal outstanding | $ 1,580,500 | $ 1,487,500 |
Fair value of debt | $ 1,600,000 | $ 1,500,000 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Mar. 31, 2020 | |
Telecommunications Capacity | ||
Commitments and Contingencies | ||
Open commitments | $ 75.2 | |
Telecommunications Capacity | Forecast | ||
Commitments and Contingencies | ||
Open commitments met | $ 5.7 | |
Construction Contracts | ||
Commitments and Contingencies | ||
Open commitments | $ 145.7 |