Digital Realty Trust (DLR) 8-K Digital Realty Trust to Present at the Credit Suisse

Real Estate Conference

April 2007

Foundation of the Digital World

Exhibit 99.2

1

Forward Looking Statements

The

information

included

in

this

presentation

contains

forward-looking

statements.

Such

statements

are

based

on

management’s

beliefs

and

assumptions

made

based

on

information

currently

available

to

management.

Such

forward

looking

statements

include

statements

and

projections

related

to

growth

in

the

Software

as

a

Service

(SaaS)

and

e-commerce

market,

the

digital

communication

and

distribution

market,

and

the

data

storage

market,

online

advertising,

the

market

effects

of

regulatory

requirements,

the

disaster

recovery

market,

estimates

of

sufficiency

of

power

and

cooling

in

existing

datacenters,

the

replacement

cost

of

our

assets,

redevelopment

costs

in

our

buildings,

and

time

periods

to

stabilization

of

our

development

space,

the

effect

new

leases

will

have

on

our

rental

revenues

and

results

of

operations,

lease

expiration

rates,

the

effect

of

leasing

and

acquisition

on

our

FFO,

and

annualized

GAAP

rent.

Such

statements

are

subject

to

risks,

uncertainties

and

assumptions

and

are

not

guarantees

of

future

performance

and

may

be

affected

by

known

and

unknown

risks,

trends,

uncertainties

and

factors

that

are

beyond

our

control

that

may

cause

actual

results

to

vary

materially.

Some

of

the

risks

and

uncertainties

include,

among

others,

the

following:

adverse

economic

or

real

estate

developments

in

our

markets

or

the

technology

industry;

general

and

local

economic

conditions;

defaults

on

or

non-renewal

of

leases

by

tenants;

difficulty

acquiring

or

operating

properties

in

foreign

jurisdictions,

changes

in

foreign

laws

and

regulations,

including

those

related

to

taxation

and

real

estate

ownership

and

operation,

increased

interest

rates

and

operating

costs;

inability

to

acquire

new

properties

(including

those

we

are

in

the

process

of

acquiring);

our

failure

to

obtain

necessary

outside

financing;

increased

construction

costs;

decreased

rental

rates

or

increased

vacancy

rates;

difficulties

in

identifying

properties

to

acquire

and

completing

acquisitions;

our

failure

to

successfully

operate

acquired

properties

and

operations;

our

failure

to

maintain

our

status

as

a

REIT;

possible

adverse

changes

to

tax

law;

environmental

uncertainties

and

risks

related

to

natural

disasters;

environmental

or

contamination

issues

at

our

buildings;

financial

market

fluctuations;

changes

in

foreign

currency

exchange

rates;

and

changes

in

real

estate

and

zoning

laws

and

increases

in

real

property

tax

rates.

The

risks

described

above

are

not

exhaustive,

and

additional

factors

could

adversely

affect

our

business

and

financial

performance,

including

those

discussed

in

our

annual

report

on

Form

10-K

for

the

year

ended

December

31,

2006

and

subsequent

filings

with

the

Securities

and

Exchange

Commission.

We

expressly

disclaim

any

responsibility

to

update

forward-looking

statements,

whether

as

a

result

of

new

information,

future

events or otherwise.

2

Digital Realty Trust overview

Tenants consist of leading global

companies diversified across various

industries

Own 62 properties comprising 11.8

million rentable sq ft which includes

1.7 million sq ft of space held for

redevelopment

(1)

Portfolio occupancy of 95.0% and

“same store”

occupancy of 97.0%

(2)

Assets strategically located in 25 top

technology markets throughout North

America and Europe

DLR is a leading institutional owner focused on mission critical

technology properties throughout North America and Europe

4025 Midway Road

Dallas, TX

(1) Includes property acquisitions as of April 6, 2007

(2) Occupancy is as of December 31, 2006, net of redevelopment space.

3

DLR investment highlights

Specialized focus in dynamic and

growing industries

High quality portfolio that is difficult to

replicate

Proven track record of creating

shareholder value

Conservative and flexible capital

structure

Industry leading domestic and

international datacenter development

and critical facilities management

capabilities

2323 Bryan Street

Dallas, TX

4

DLR properties feature advanced technical systems

Between $500 and $1000 psf typically invested in DLR buildings, creating a barrier to

exit for tenants and discouraging speculative new supply

Power backup/redundancy

Power management/conversion

Precision air cooling/handling

Systems and security controls

5

DLR presence in 25 top markets

(1)

11,768,000

83

62

Total

866,000

10

8

International

10,902,000

73

54

Domestic

Total Rentable

Square Feet

# of Buildings

# of Properties

(1) Includes  properties owned as of April 6, 2007

6

DLR properties serve a variety of industry verticals

DLR offers corporate enterprise tenants, IT service providers, and network

carriers flexible, cost-effective and reliable datacenter solutions

Technology

Internet

Enterprise

Communications

Manufacturing/

Energy/Retail

Financial

7

DLR is unique in its focus on technology properties

Corporate Datacenters

–

Storage/server intensive buildings

–

Provide a secure 24x7 environment

for the storage and processing of

mission-critical electronic

information

–

Used to house primary IT

operations: transaction processing,

data storage, disaster recovery,

CRM and email

Internet Gateways

–

Internet and telecom network

intensive buildings

–

Serve as the hub for Internet and

data communications within and

between major metropolitan areas

–

Market-dominant position in their

respective MSAs

–

Frequently serve as a super-

regional connection point with

multiple anchor tenants

Internet

Gateways

38%

Non

Technical

11%

Corporate

Datacenters

51%

(1) Calculation based on average annualized GAAP rents using in place leases as of December 31, 2006, excluding two non technical assets sold

during the first quarter of 2007.

Portfolio Distribution

(1)

8

Strong trends drive sustained demand for DLR space

Other Growth Drivers

By 2008, 50% of existing

corporate data centers will

have insufficient power and

cooling capacity to meet the

demands of high-density

equipment

(4)

Increased federal regulatory

and legislative requirements for

business continuity and

records retention

Disaster Recovery initiatives

prioritized as a result of

Hurricanes Katrina and Rita

HIPAA patient records security

and retention regulations

Significant growth in online

advertising: up 30% in 2006;

expected 19% increase in

2007

(5)

U.S. e-commerce spending

increased 24% during 2006

(6)

(1)

(2)

(3)

Primary Drivers –

Estimated Annual Growth Rates

(1) Gartner (May 2006) estimated growth in Software as a Service

(SaaS) from 2006 to 2009

(2) IDC estimate of US VOIP subscriber growth from 2005 to 2009

(3) Wall Street Journal estimate of corporate data storage capacity growth

(4) Gartner 25th

Annual Datacenter Conference 2006

(5) eMarketer.com, February 2007

(6) comScore

Networks, 2007

73%

60%

57%

0

20

40

60

80

SaaS

Digital

Communication

& Distribution

Data Storage

100%

9

0%

10%

20%

30%

40%

50%

60%

70%

80%

1Q02

4Q02

3Q03

2Q04

1Q05

4Q05

3Q06

$0

$100

$200

$300

$400

$500

$600

Source:

Estimated based on reported cabinet (available and billing), square feet and revenue data from Equinix and Savvis as per press releases, SEC filings, research

reports and internal DLR estimates as of December 31, 2006.  Assumes 35 sq ft per cabinet throughout period if square feet not reported. 

Equinix

and

Savvis,

two

leading

managed

service

providers

that

“resell”

space

leased

directly

from

DLR,

are

experiencing

strong

growth

in

revenues

and

utilization

Bill rates and utilization rates are escalating

Revenue PSF

Utilization Rate

Revenue PSF (Utilized)

$518 psf

Revenue PSF (Total)

$148 psf

Utilization Rate

29%

$542 psf

$360 psf

69%

10

DLR offers sustained growth

Acquisitions

Leasing of Turn-Key

Datacenter™

Space

Redevelopment Inventory

DLR growth is derived from three sources

11

$847.2

$1,044.3

$1,137.4

$1,413.4

$1,508.5

$1,593.6

$1,648.2

$1,794.4

$2,066.2

$2,298.7

$600

$800

$1,000

$1,200

$1,400

$1,600

$1,800

$2,000

$2,200

$2,400

9/30/2004

12/31/2004

3/31/2005

6/30/2005

9/30/2005

12/31/2005

3/31/2006

6/30/2006

9/30/2006

12/31/2006

Proven track record: strong acquisition activity

Since its IPO, DLR has more than doubled its total assets through

property acquisitions

Total Undepreciated

Assets

($000)

12

2005, 2006 & YTD 2007 acquisitions

Acquired 40+ properties

(1)

totaling over $1.2 billion

Added approximately 6.9 million square feet to total portfolio, including

1.8 million square feet of redevelopment inventory

New markets include:

–

Philadelphia

–

St. Paul

–

Chicago

–

Charlotte

–

Amsterdam, Netherlands

–

Geneva, Switzerland

–

Northern Virginia

–

Austin

–

Dublin, Ireland

–

Toronto, Canada

–

Houston

–

Seattle

–

Paris, France

Chicago, Illinois

Paris, France

(1)

Includes

one

property

held

as

an

investment

in

an

unconsolidated

joint

venture

13

(1)

Net rentable square feet figures excludes space held for redevelopment.

(2)

AboveNet Portfolio includes 1807 Michael Faraday Court, 8100 Boone Boulevard (VA) and 111 Eighth Street (NY).

(3)

Held as an investment in an unconsolidated joint venture in which DLR has a 49% interest.

(4)

Loudoun

Exchange

Portfolio

consists

of

43881,

43831

&

43791

Devin

Shafron

Drive

(VA).

DLR has acquired approximately $1.2 billion in new properties

2005,2006 & YTD 2007 acquisitions

Purchase

Total Rentable

Net Rentable

Redevelopment

Occupancy

Property

Location

Price (M)

Sq Ft

Sq Ft

(1)

Sq Ft

(Net of Redev)

2005 Acquisitions

$466

3,490,685

2,658,433

832,252

4025 Midway Road

Carrollton, TX

100,590

36,856

63,734

100%

Clonshaugh Industrial Estate

Dublin, Ireland

20,000

20,000

-

100%

Clonshaugh Industrial Estate

Dublin, Ireland

2.6 acres

-

-

N/A

6800 Millcreek Drive

Toronto, Canada

83,758

83,758

-

100%

101 Aquila Way

Atlanta

313,581

313,581

-

100%

12001 North Freeway

Houston

300,705

281,426

19,279

98%

14901 FAA Boulevard

Dallas

263,700

263,700

-

100%

120 E. Van Buren Street

Phoenix

287,514

206,359

81,155

97%

Gyroscoopweg 2E-2F

Amsterdam, Netherlands

55,585

55,585

-

100%

600 Winter Street

Waltham, MA

30,400

30,400

-

100%

2300 NW 89th Place

Miami

64,174

64,174

-

100%

AboveNet Portfolio

(2)

New York & N. Virginia

119,389

119,389

-

100%

2055 East Technology Circle

Tempe, AZ

76,350

-

76,350

N/A

2001 Sixth Avenue

(3)

Seattle, WA

389,460

389,460

-

90%

114 Rue Ambroise Croizat

Paris, France

352,146

122,627

229,519

56%

Blanchardstown Corporate Park

Dublin, Ireland

120,000

86%

2006 Acquisitions

$553

2,577,352

1,987,315

470,037

21110 Ridgetop Circle

Sterling, VA

135,000

-

135,000

100%

3011 Lafayette Street

Santa Clara, CA

90,780

90,780

N/A

44470 Chillum Place

Ashburn, VA

95,440

-

95,440

100%

NYC Connect (111 8th Ave)

New York

33,700

33,700

94%

Loudoun Exchange Portfolio

(4)

Ashburn, VA

432,071

167,071

265,000

39%

YTD 2007 Acquisitions

$161

786,991

291,551

495,440

Total 2005, 2006 & YTD2007 Acquisitions

$1,180

6,855,028

4,937,299

1,797,729

14

Leasing drives internal growth

DLR commenced 211 leases during 2006, contributing approximately

$30.0

million

in

annualized

GAAP

rental

revenues

(1)

(1)

GAAP rental revenues include total rent for both renewals and expansions.

(2)

Excludes leases for parking garages

$2.7 million

$17.00

155,000

33

Non Technical

(2)

$4.8 million

$42.00

114,000

5

Redevelopment

$22.6 million

$121.00

186,000

173

Datacenter

Annualized

GAAP Rent

Annualized

GAAP Rent PSF

Total SF

Leased

# of Leases

Type of Space

DLR executed 231 leases during 2006, contributing approximately $41.2 million

in

annualized

GAAP

rental

revenues

(1)

.

In

the

fourth

quarter

of

2006

DLR

executed leases for 302,000 sf

of datacenter space that will commence in 2007.

15

Same store growth

36,000

37,000

38,000

39,000

40,000

41,000

42,000

43,000

44,000

45,000

Dec-05

Mar-06

Jun-06

Sep-06

Dec-06

93.0%

93.5%

94.0%

94.5%

95.0%

95.5%

96.0%

96.5%

97.0%

97.5%

Quarterly Operating Revenue

Occupancy

($000)

Same Store Quarterly Operating

Revenue

(2)

Increase = 11.5%

Same Store Occupancy

(1)

Increase = 250 bps

(1)

Same store occupancy excludes redevelopment space until leased

(2)

Quarterly operating revenue includes rental and tenant reimbursement revenue.

(3)

Calculated based on reported 4Q06 operating revenue of $35,744 less $2,498 straight line rent and less $394k for below/above rent amortization

Fourth

quarter

2006

same

store

cash

was

$32,852

(3)

16

Case studies:  DLR’s

value-add leasing

(1)  Calculation based on IPO date of November 2004 and actual Net Operating Income (NOI) as of December 31,2006. See page 29 for a discussion of NOI.

350 East Cermak Road

1100 Space Park Drive

200 Paul Avenue

300 Boulevard East

Property Name

Location

Acquisition /

IPO Date

% Change in NOI

from later of

Acquisition or

IPO

(1)

200 Paul Avenue

San Francisco, CA

Nov-04

41.5%

1100 Space Park Drive

Santa Clara, CA

Nov-04

50.9%

350 East Cermak Road

Chicago, IL

May-05

18.8%

300 Boulevard East

Weehawken, NJ

Nov-04

52.5%

17

DLR redevelopment inventory

Redevelopment inventory totals 1.8 million

sf

of vacant space with potential for up to

1.1 million sf

of datacenter:

–

Approximately 65% of inventory in

income-producing properties

–

Remaining 35% of inventory in 6

recently acquired vacant buildings

Redevelopment costs vary by building

–

Base building power, structural

upgrades: $35 -

$50 psf

–

Custom datacenter:  $350 to $800 psf

(funding available through DLR)

Total

capital

investment

of

$312.2

million

(1)

–

Approximately $148.9 million invested

in income-producing properties

–

Approximately $163.3 million invested

in vacant buildings

(2)

Growth Opportunity

(1)

Capital investment as of December 31,2006

(2)

Includes acquisition costs, including vacant Paris building

18

Redevelopment program progress report

Construction projects underway in 11 U.S. and European markets totaling over

500,000 rentable square feet of Turn-Key Datacenter™

and build-to-suit space

DLR’s

Turn-Key Datacenters™

–

Move-in ready, physically secure facilities with redundant power and cooling

capabilities

–

Measuring 10,000 –

12,000 square feet of raised-floor featuring DLR’s

POD Architecture™

Strong interest from prospective tenants

Stabilized income projected over the next 36 months

Turn-Key Datacenter™

Built-to-suit

19

DLR’s

competitive advantage: Dedicated technical professionals

Staff of over 50 DLR technical professionals:

–

IT sales team

Focus on end-user, IT professionals (CIO or CTO)

–

Datacenter sales engineers

Provide value engineering and custom design expertise

–

Design and construction experts

Disciplined approach to project management

Volume purchase agreements for equipment and services

Best-in-class engineering and contracting

–

Datacenter facilities management team

Best-in-class operating policies and procedures

Fully-integrated Building Automation Systems

Global preventative maintenance agreements

Operating scale and process-based approach result in significant cost

savings and added value for tenants

DLR possesses the necessary scale to support these specialized professionals

20

Source:  Independent study by CCG Facilities Integration Inc. based on datacenter projects with improvements similar to DLR.

(1)

Infrastructure only. Does not include electronic equipment. Assumes 60% ratio of datacenter to total building with all cost allocated to raised floor area.

(2)

DLR estimate based on Equinix press release dated September 19, 2006

(3)

Reflects all owned properties and revised as of March 1, 2007 

Replacement Cost Estimate

Replacement

cost

illustrates

the

value

of

DLR’s

portfolio

DLR

owns

over

6.1

million

sq

ft

of

improved

datacenter

space

(3)

Cost per Square Foot

Equinix

(2)

Cost Components

Low

High

Land

$40

$70

Building Shell

60

150

Electrical Systems

$297

$396

Mechanical Systems (HVAC)

92

122

Fire Protection

21

29

Other Construction and Fees

130

173

Sub Total

$540

$720

Total Development Costs

$640

$940

$1,250

Base Building

Data Center

Improvements

(1)

21

2.0%

4.5%

5.4%

9.2%

13.5%

5.6%

6.0%

5.8%

17.5%

7.9%

17.6%

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

Thereafter

DLR’s model features long-term, stable leases

The stability of our long-term leases complements our growth

Note:  Excludes vacant square footage of 0.5 million square feet

and 1.5 million square feet of space held for redevelopment as of December 31, 2006

Lease expiration as a percentage of net rentable square feet

11.9% in through 2009

The average lease term is approximately 12 years with 7 years remaining.

Leases typically contain 3% annual rent bumps.

22

DLR financial overview

Strong

and

consistent

FFO

(1)

growth

–

$1.63 per diluted share and unit for 2006, +19% from 2005

–

$0.48 per diluted share and unit for 4Q06, +33% from 4Q05 and +17% from 3Q06

Well supported dividend

–

2.9%

yield

(2)

–

FFO

/

AFFO

payout

ratio

of

60%

/

99%

(3)

for

4Q06

–

Increased quarterly common dividend in 4Q06, +8%

Proven access to capital

–

First quarter 2007

Raised

$169.1

million

in

net

proceeds

from

convertible

preferred

stock

offering

Sold to non-core assets for estimated total gain on sale of $18.1

–

$900.2 million of capital raised in 2006

Amended credit facility twice

–

Increased facility size from $350 to $500 million

–

Changed financial covenants to enhance financial flexibility

–

Added redevelopment assets to borrowing base to support redevelopment program

Raised $172.5 million of 4.125% convertible debt

Completed 10 mortgage financings totaling $349.4 million

Raised $228.3 million in net proceeds from two common stock offerings

Increased float by 98.3% from 27.4 million to 54.3 million shares of common stock

outstanding

(1)

FFO and AFFO is a non GAAP financial measure. For a description of FFO and AFFO see page 29.

(2)

Based on most recent quarterly dividend annualized.  Dividend yield based on April 5, 2007 closing stock price of $39.25

(3)

FFO

payout

ratio

is

dividend

declared

per

common

share

and

unit

divided

by

diluted

FFO

per

share

and

unit.

AFFO

payout

ratio

is

dividend

declared

per

common

share

and

unit

divided

by

diluted

AFFO

per

share

and

unit.

For

a

description

of

FFO

and

AFFO

see

page

29.

For

a

reconciliation

to

net

income

see

page

30.

23

2006 actual results compared to guidance

$552.5 million

9.0% cap rate

(4)

300K @ $91.00 psf

155K @ $17.00 psf

$1.63

Actual 2006

$300 -

$400 million

8%

to

9%

cap

rate

(4)

Acquisitions

200K –

300K sf

@ $40.00 psf

100K –

125K @ $19.00

Leasing: Datacenter

Non Technical

(2)

$1.57 –

$1.59

FFO

(2)

per share

Guidance 2006

(1)

(1)

Based on Company guidance updated on December 7, 2006

(2)

FFO

and

AFFO

are

non

GAAP

financial

measures.

For

a

description

of

FFO

and

AFFO

see

page

29.

For

a

reconciliation

to

net

income

see

page

30.

(3)

Excludes leases for parking garages

(4)

Excludes vacant properties

2006 FFO per diluted share and unit was up 19.0% over 2005; fourth quarter

2006 FFO was $0.48 per share, up 33.0% over fourth quarter 2005.

24

DLR 2007 guidance

2007 projected funds from operations (FFO) per share guidance:

(1)(2)

$1.85 to $1.95

(1)

Based

on

Company

guidance

confirmed

in

our

February

28,

2006

conference

call.

(2)

FFO

and

AFFO

are

non

GAAP

financial

measures.

For

a

description

of

FFO

and

AFFO

see

page

29.

For

a

reconciliation

to

net

income

see

page

30.

Internal Growth 

8.8% to 12.7%

FFO

(2)

Per Share Growth

Leasing 

475,000 to  600,000 sq ft of turn-

key & redevelopment space

(gross rent $80 / sq ft)

100,000 to 125,000 sq ft of basic

commercial space (gross rent

$19 / sq ft)

Acquisitions

$300 - $400 million 

o

$75 million of vacant

for redevelopment

o

$225 to $325 million of

income producing at

an average cap rate of

8.25%

External Growth

4.7% to 6.9%

FFO Per Share Growth

13.5% to 19.6%

Overall FFO Per Share Growth

•

Capital Expenditure for redevelopment of $273 million

•

Total G&A of $24 million

25

Improving overall credit quality of DLR portfolio

+

=

+

=

Approximately $18 million of base rental income, or over 8% of overall income, has

experienced an improvement in credit quality.

(1)

As a result of a sublease relationship with Microsoft for 200,000 sq ft of space that is leased directly by Savvis.

(2)

On June 30, 2006, SAVVIS completed the exchange of its Series A Preferred stock for 37.4 million shares of common stock.

(1)(2)

26

DLR’s

top tenants have experienced a robust increase in equity capitalization

(1)

Significant Equity Capitalization Improvement in Top Tenants

$18.0

12.0

6.0

(1) Increase in equity capitalization calculated as of April 5, 2007 from DLR IPO date of November 1, 2004

$0.6

$0.4

$1.8

$2.5

$0.7

$1.2

$2.2

$2.6

$17.0

$15.9

$10.6

$6.1

0.0

2.0

27

DLR employs a conservative capital structure

Wtd

average cost of debt:

5.84%

(5)

; approximately 94%

fixed rate debt

(6)

Coverage ratios

(7)

:

–

Debt service: 4.0x

–

Fixed charge: 2.9X

Periodically refinancing high

cost debt with lower rate,

longer term, fixed rate

financing

Total Enterprise Value

(1)

$4,159.5M

Dividend Yield / Rate:    2.9% / $1.145

(1)

Based on closing price of $39.25 and shares outstanding of DLR common stock at April 5, 2007.

(2)

Excludes $2.0 million of unamortized debt premium for 1125 Energy Park Drive & 731 East Trade Street.

(3)

Pro forma unsecured credit facility as of April 6, 2007; will fluctuate based on amount drawn on credit facility from time to time.

(4)

Includes the $175 million convertible preferred stock offering announced on April 3, 2007.

(5)

Excluding the equity component of the convertible debt, the weighted average cost of debt is 5.66%.

(6)

Includes $172.5 million of convertible debt

(7)

As of 12/31/06, debt service coverage ratio is Adjusted EBITDA divided by cash interest expense; fixed charge coverage ratio is Adjusted EBITDA divided by fixed charges.

Total Fixed Rate

Debt

26.0%

Total Variable Rate

Debt

1.7%

Preferred

8.2%

Equity

64.1%

(2)(6)

(3)

(1)

(4)

29

Definition of Non-GAAP Financial Measures

This

presentation

includes

certain

non-GAAP

financial

measures

that

management

believes

are

helpful

in

understanding

our

business,

as

further

described

below.

Our

definition

and

calculation

of

non-GAAP

financial

measures

may

differ

from

those

of

other

REITs,

and,

therefore,

may

not

be

comparable.

The

non-GAAP

financial

measures

should

not

be

considered

an

alternative

to

net

income

or

any

other

GAAP

measurement

of

performance

and

should

not

be

considered

an

alternative

to

cash

flows

from

operating,

investing

or

financing

activities

as

a

measure

of

liquidity.

Funds from Operations (FFO)

We

calculate

Funds

from

Operations,

or

FFO,

in

accordance

with

the

standards

established

by

the

National

Association

of

Real

Estate

Investment

Trusts,

or

NAREIT.

FFO

represents

net

income

(loss)

(computed

in

accordance

with

GAAP),

excluding

gains

(or

losses)

from

sales

of

property,

real

estate

related

depreciation

and

amortization

(excluding

amortization

of

deferred

financing

costs)

and

after

adjustments

for

unconsolidated

partnerships

and

joint

ventures.

Management

uses

FFO

as

a

supplemental

performance

measure

because,

in

excluding

real

estate

related

depreciation

and

amortization

and

gains

and

losses

from

property

dispositions,

it

provides

a

performance

measure

that,

when

compared

year

over

year,

captures

trends

in

occupancy

rates,

rental

rates

and

operating

costs.

We

also

believe

that,

as

a

widely

recognized

measure

of

the

performance

of

REITs,

FFO

will

be

used

by

investors

as

a

basis

to

compare

our

operating

performance

with

that

of

other

REITs.

However,

because

FFO

excludes

depreciation

and

amortization

and

captures

neither

the

changes

in

the

value

of

our

properties

that

result

from

use

or

market

conditions,

nor

the

level

of

capital

expenditures

and

leasing

commissions

necessary

to

maintain

the

operating

performance

of

our

properties,

all

of

which

have

real

economic

effect

and

could

materially

impact

our

results

from

operations,

the

utility

of

FFO

as

a

measure

of

our

performance

is

limited.

Other

REITs

may

not

calculate

FFO

in

accordance

with

the

NAREIT

definition

and,

accordingly,

our

FFO

may

not

be

comparable

to

such

other

REITs’

FFO.

Accordingly,

FFO

should

be

considered

only

as

a

supplement

to

net

income

as

a

measure

of

our

performance.

Adjusted Funds From Operations (AFFO)

We

present

adjusted

funds

from

operations,

or

AFFO,

as

a

supplemental

operating

measure

because,

when

compared

year

over

year,

it

assesses

our

ability

to

fund

dividend

and

distribution

requirements

from

our

operating

activities.

We

also

believe

that,

as

a

widely

recognized

measure

of

the

operations

of

REITs,

AFFO

will

be

used

by

investors

as

a

basis

to

assess

our

ability

to

fund

dividend

payments

in

comparison

to

other

REITs.

We

calculate

adjusted

funds

from

operations,

or

AFFO,

by

adding

to

or

subtracting

from

FFO

(i)

non-real

estate

depreciation,

(ii)

amortization

of

deferred

financing

costs

(iii)

non

cash

compensation

(iv)

loss

from

early

extinguishment

of

debt

(v)

straight

line

rents

(vi)

fair

value

of

lease

revenue

amortization

(vii)

capitalized

leasing

payroll

(viii)

recurring

tenant

improvements

and

(ix)

capitalized

leasing

commissions.

Other

equity

REITs

may

not

calculate

AFFO

in

a

consistent

manner.

Accordingly,

our

AFFO

may

not

be

comparable

to

other

equity

REITs’

AFFO.

AFFO

should

be

considered

only

as

a

supplement

to

net

income

computed

in

accordance

with

GAAP

as

a

measure

of

our

operations.

Net Operating Income (NOI)

NOI

represents

rental

revenue

and

tenant

reimbursement

revenue

less

rental

property

operating

and

maintenance,

property

taxes

and

insurance

expenses

(as

reflected

in

statement

of

operations).

NOI

is

commonly

used

by

stockholders,

company

management

and

industry

analysts

as

a

measurement

of

operating

performance

of

the

company’s

rental

portfolio.

However,

because

NOI

excludes

depreciation

and

amortization

and

captures

neither

the

changes

in

the

value

of

our

properties

that

result

from

use

or

market

conditions,

nor

the

level

of

capital

expenditures

and

leasing

commissions

necessary

to

maintain

the

operating

performance

of

our

properties,

all

of

which

have

real

economic

effect

and

could

materially

impact

our

results

from

operations,

the

utility

of

NOI

as

a

measure

of

our

performance

is

limited.

Other

REITs

may

not

calculate

NOI

in

the

same

manner

we

do

and,

accordingly,

our

NOI

may

not

be

comparable

to

such

other

REITs’

NOI.

Accordingly,

NOI

should

be

considered

only

as

a

supplement

to

net

income

as

a

measure

of

our

performance.

Each

of

FFO

and

Adjusted

EBITDA

exclude

items

that

have

real

economic

effect

and

could

materially

impact

our

results

from

operations,

and

therefore

the

utility

of

FFO

and

Adjusted

EBTIDA

as

a

measure

of

our

performance

is

limited.

Nothing

contained

herein

is

intended

to

revise

or

confirm

the

earnings,

FFO

or

acquisition

guidance

we

confirmed

on

our

Earnings

Conference

Call

held

on

February

28,

2007

and

available

on

our

website

at

www.digitalrealtytrust.com.

30

Reconciliation of non GAAP items to their closest GAAP

Funds from operations

(1)

Cash interest expense (including discontinued operations)

Q406

Q306

Q405

FY2006

FY2005

Q406

Q306

Q405

FY2006

FY2005

Net income available to common stockholders

$2,978

$11,342

$1,157

$17,612

$6,087

Total GAAP interest expense (including

discontinued operations)

$14,569

$14,533

$10,988

$52,671

$39,122

Capitalized interest

1,114

917

279

3,851

279

Minority interests in operating partnership including

discontinued operations

1,276

8,464

1,338

12,926

8,268

  ��     

Change in accrued interest and other

noncash amounts

(3,206)

(2,590)

(1,660)

(7,645)

(4,345)

Real estate related depreciation and amortization

(2)

28,055

24,454

18,781

90,932

62,171

Cash interest expense

$12,477

$12,860

$9,607

$48,877

$35,056

Real estate related depreciation and amortization related

to investment in unconsolidated joint venture

796

-

-

796

-

Gain on sale of assets

(80)

(18,016)

-

(18,096)

-

Funds from operations (FFO)

$33,025

$26,244

$21,276

$104,170

$76,526

Funds from operations (FFO) per diluted share

$          0.48

$          0.41

$          0.36

$          1.63

$        1.37

Net income per diluted share available to common

stockholders

$          0.06

$          0.30

$          0.04

$          0.47

$        0.25

Funds from operations (FFO)

$33,025

$26,244

$21,276

$104,170

$76,526

Non real estate depreciation

118

285

23

511

61

Amortization of deferred financing costs

1,115

916

793

3,763

2,965

Non cash compensation

491

430

335

1,787

481

Loss from early extinguishment of debt

6

40

896

528

1,021

Straight line rents

(5,810)

(3,856)

(4,172)

(17,742)

(13,023)

Above and below market rent amortization

(2,238)

(2,837)

(632)

(7,012)

(1,717)

Capitalized leasing compensation

(217)

(185)

(105)

(2,054)

(781)

Recurring capital expenditures and tenant improvements

(2,574)

(344)

(1,406)

(4,160)

(2,897)

Capitalized leasing commissions

(3,716)

(1,523)

(1,535)

(7,186)

(3,051)

Adjusted funds from operations

(1)

$20,200

$19,170

$15,473

$72,605

$59,585

(2) Real estate depreciation and amortization was computed as follows:

Q406

Q306

Q405

FY2006

FY2005

Depreciation and amortization per income statement

$28,173

$24,739

$18,040

$89,936

$59,616

Depreciation and amortization of discontinued operations

at 7979 East Tufts Avenue

-

-

764

1,507

2,616

Non real estate depreciation

(118)

(285)

(23)

(511)

(61)

$28,055

$24,454

$18,781

$90,932

$62,171

Weighted-average shares outstanding - diluted

69,213

64,397

59,248

63,870

55,761

(1) Funds from operations and Adjusted Funds from operations for all periods presented above includes the results of 7979

East Tufts Avenue, a property which we sold on July 12, 2006.

2007 FFO Reconcilliation

(in millions, except per share and unit data)

Low end of

range

High end

of range

$43.10

—

$50.40

Plus: Real estate related depreciation and amortization

109.8

—

111.2

Funds from operations

$152.90

—

$161.20

Less:  Preferred stock dividends

-19.2

-19.2

FFO available to common stockholders and unit holders

$133.70

—

$142.40

FFO per share of common stock and unit outstanding

$1.85

—

$1.95

Net income before minority interest in operating partnership but

after minority interest in consolidated joint ventures