CoreSite Realty 10-Q 28 Apr 17 2017 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2017	Apr. 26, 2017
Document and Entity Information
Entity Registrant Name	CoreSite Realty Corp
Entity Central Index Key	1,490,892
Document Type	10-Q
Document Period End Date	Mar. 31, 2017
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		34,195,567
Document Fiscal Year Focus	2,017
Document Fiscal Period Focus	Q1

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Investments in real estate:
Land	$ 97,258	$ 100,258
Buildings and improvements	1,475,029	1,472,580
Total investments in real estate	1,572,287	1,572,838
Less: Accumulated depreciation and amortization	(395,039)	(369,303)
Net investment in operating properties	1,177,248	1,203,535
Construction in progress	98,695	70,738
Net investments in real estate	1,275,943	1,274,273
Cash and cash equivalents	2,386	4,429
Accounts and other receivables, net of allowance for doubtful accounts of $30 and $209 as of March 31, 2017, and December 31, 2016, respectively	21,369	25,125
Lease intangibles, net of accumulated amortization of $13,555 and $12,385 as of March 31, 2017, and December 31, 2016, respectively	8,743	9,913
Goodwill	41,191	41,191
Other assets, net	102,957	96,372
Total assets	1,452,589	1,451,303
Liabilities:
Debt, net of unamortized deferred financing costs of $3,343 and $3,550 as of March 31, 2017, and December 31, 2016, respectively	719,657	690,450
Accounts payable and accrued expenses	55,164	72,519
Accrued dividends and distributions	41,097	41,849
Deferred rent payable	9,099	7,694
Acquired below-market lease contracts, net of accumulated amortization of $5,645 and $5,439 as of March 31, 2017, and December 31, 2016, respectively	4,086	4,292
Unearned revenue, prepaid rent and other liabilities	34,820	37,413
Total liabilities	863,923	854,217
Stockholders' equity:
Series A Cumulative Preferred Stock 7.25%, $115,000 liquidation preference ($25.00 per share, $0.01 par value), 4,600,000 shares issued and outstanding as of March 31, 2017, and December 31, 2016	115,000	115,000
Common Stock, par value $0.01, 100,000,000 shares authorized and 34,193,619 and 33,896,771 shares issued and outstanding at March 31, 2017, and December 31, 2016, respectively	338	334
Additional paid-in capital	444,653	438,531
Accumulated other comprehensive income (loss)	332	(101)
Distributions in excess of net income	(128,797)	(118,038)
Total stockholders' equity	431,526	435,726
Noncontrolling interests	157,140	161,360
Total equity	588,666	597,086
Total liabilities and equity	$ 1,452,589	$ 1,451,303

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2017	Dec. 31, 2016
CONDENSED CONSOLIDATED BALANCE SHEETS
Allowance for doubtful accounts (in dollars)	$ 30	$ 209
Accumulated amortization, lease intangibles (in dollars)	13,555	12,385
Unamortized Debt Issuance Expense	3,343	3,550
Accumulated amortization of below-market lease	$ 5,645	$ 5,439
Series A Cumulative Preferred Stock, dividend rate (as a percent)	7.25%	7.25%
Series A Cumulative Preferred Stock, liquidation preference	$ 115,000	$ 115,000
Series A Cumulative Preferred Stock, liquidation preference (in dollars per share)	$ 25	$ 25
Series A Cumulative Preferred Stock, par value (in dollars per share)	$ 0.01	$ 0.01
Series A Cumulative Preferred Stock, shares issued	4,600,000	4,600,000
Series A Cumulative Preferred Stock, shares outstanding	4,600,000	4,600,000
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	34,193,619	33,896,771
Common Stock, shares outstanding	34,193,619	33,896,771

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Data center revenue:
Rental revenue	$ 64,251	$ 50,371
Power revenue	30,861	25,574
Interconnection revenue	14,512	12,742
Tenant reimbursement and other	2,276	1,830
Office, light-industrial and other revenue	3,021	1,963
Total operating revenues	114,921	92,480
Operating expenses:
Property operating and maintenance	29,226	24,663
Real estate taxes and insurance	4,504	3,065
Depreciation and amortization	32,338	24,770
Sales and marketing	4,503	4,221
General and administrative	8,124	8,720
Rent	5,962	5,417
Transaction Costs		3
Total operating expenses	84,657	70,859
Operating income	30,264	21,621
Interest income		1
Interest expense	(5,107)	(2,012)
Income before income taxes	25,157	19,610
Income tax expense	(97)	(4)
Net income	25,060	19,606
Net income attributable to noncontrolling interests	6,684	6,261
Net income attributable to CoreSite Realty Corporation	18,376	13,345
Preferred stock dividends	(2,084)	(2,084)
Net income attributable to common shares	$ 16,292	$ 11,261
Net income per share attributable to common shares:
Basic (in dollars per share)	$ 0.49	$ 0.37
Diluted (in dollars per share)	$ 0.48	$ 0.37
Weighted average common shares outstanding
Basic (in shares)	33,558,787	30,252,693
Diluted (in shares)	33,981,776	30,694,747

CONSOLIDATED STATEMENTS OF COMP

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Net income	$ 25,060	$ 19,606
Other comprehensive income (loss):
Unrealized gain (loss) on derivative contracts	313	(3,198)
Reclassification of other comprehensive income to interest expense	297	456
Comprehensive income	25,670	16,864
Comprehensive income attributable to noncontrolling interests	6,861	5,281
Comprehensive income attributable to CoreSite Realty Corporation	$ 18,809	$ 11,583

CONSOLIDATED STATEMENTS OF EQUI

CONSOLIDATED STATEMENTS OF EQUITY - 3 months ended Mar. 31, 2017 - USD ($) $ in Thousands	Preferred Stock	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, 2016	$ 115,000	$ 334	$ 438,531	$ (101)	$ (118,038)	$ 435,726	$ 161,360	$ 597,086
Balance (in shares) at Dec. 31, 2016		33,896,771
Increase (Decrease) in Stockholders' Equity
Issuance of stock awards, net of forfeitures (in shares)		133,149
Exercise of stock options, net of settlements		$ 2	4,172			4,174		4,174
Exercise of stock options, net of settlements (in shares)		163,699
Share-based compensation		$ 2	1,950			1,952		1,952
Dividends declared on preferred stock					(2,084)	(2,084)		(2,084)
Dividends and distributions					(27,051)	(27,051)	(11,081)	(38,132)
Net income					18,376	18,376	6,684	25,060
Other comprehensive income (loss)				433		433	177	610
Balance at Mar. 31, 2017	$ 115,000	$ 338	$ 444,653	$ 332	$ (128,797)	$ 431,526	$ 157,140	$ 588,666
Balance (in shares) at Mar. 31, 2017		34,193,619

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$ 25,060	$ 19,606
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	32,338	24,770
Amortization of above/below market leases	(124)	(133)
Amortization of deferred financing costs	369	283
Share-based compensation	1,802	2,093
Bad debt expense	(96)	142
Changes in operating assets and liabilities:
Accounts receivable	3,853	(4,011)
Deferred rent receivable	(1,350)	(1,047)
Deferred leasing costs	(3,660)	(3,541)
Other assets	(7,243)	(6,102)
Accounts payable and accrued expenses	846	(5,533)
Unearned revenue, prepaid rent and other liabilities	(2,255)	129
Deferred rent payable	1,405	(320)
Net cash provided by operating activities	50,945	26,336
CASH FLOWS FROM INVESTING ACTIVITIES
Tenant improvements	(2,608)	(777)
Real estate improvements	(42,586)	(70,601)
Net cash used in investing activities	(45,194)	(71,378)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from exercise of stock options	4,174	1,009
Proceeds from revolving credit facility	38,000	60,750
Payments on revolving credit facility	(9,000)	(92,000)
Proceeds from unsecured term loan		100,000
Payments of loan fees and costs		(1,035)
Dividends and distributions	(40,968)	(27,336)
Net cash provided by (used in) financing activities	(7,794)	41,388
Net change in cash and cash equivalents	(2,043)	(3,654)
Cash and cash equivalents, beginning of period	4,429	6,854
Cash and cash equivalents, end of period	2,386	3,200
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for interest, net of capitalized amounts	3,302	1,748
NON-CASH INVESTING AND FINANCING ACTIVITY
Construction costs payable capitalized to real estate	9,461	33,931
Accrual of dividends and distributions	$ 41,097	$ 28,158

Organization and Description of

Organization and Description of Business	3 Months Ended
	Mar. 31, 2017
Organization and Description of Business
Organization and Description of Business	1. Organization and Description of Business CoreSite Realty Corporation (the “Company,” “we,” “us,” or “our”) 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 (“REIT”). Through our controlling interest in CoreSite, L.P. (our “Operating Partnership”), we are engaged in the business of owning, acquiring, constructing and operating data centers. As of March 31, 2017, the Company owns a 70.9% common interest in our Operating Partnership and affiliates of The Carlyle Group and others own a 29.1% interest in our Operating Partnership. See additional discussion in Note 8, Noncontrolling Interests — Operating Partnership.

Summary of Significant Accounti

Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2017
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies	2. Summary of Significant Accounting Policies Principles of Consolidation and Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared by our management in accordance with U.S. generally accepted accounting principles (“GAAP”) 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, 2017, are not necessarily indicative of the expected results for the year ending December 31, 2017. 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 for the year ended December 31, 2016. Intercompany balances and transactions have been eliminated upon consolidation. Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued guidance codified in Accounting Standards Codification (“ASC”) Topic 606, Revenue Recognition — Revenue from Contracts with Customers, which amends the guidance in former ASC 605, Revenue Recognition. The standard establishes a five-step model framework which recognizes revenue as an entity transfers control of goods or services to the customer and requires enhanced disclosures. This standard does not apply to leases, which will be accounted for under ASC Topic 842, Leases. The revenue standard is effective for interim and annual reporting periods beginning after December 15, 2017. The standard permits the use of either the retrospective or cumulative effect transition method. As ASC Topic 606 does not impact lessor accounting, we do not believe this standard will significantly impact our accounting for rental revenue. In addition, we do not anticipate a significant impact to our accounting for power, interconnection, tenant reimbursement and other revenue. In February 2016, the FASB issued guidance codified in ASC Topic 842, Leases , which amends the guidance in former ASC 840, Leases. The main principle of ASC 842 requires lessees to recognize the assets and liabilities that arise from nearly all leases on the consolidated balance sheet. Lessor accounting remains mainly consistent with current guidance, with the majority of changes allowing for better alignment with the new lessee model and ASC Topic 606. The standard is effective for interim and annual reporting periods beginning after December 15, 2018, with early adoption permitted. The standard requires a modified retrospective transition approach. We plan to adopt ASC Topic 842 and ASC Topic 606 effective January 1, 2018, which will result in a transition date of January 1, 2016. As a lessee we do not anticipate the classification of our leases to change, but we will be required to recognize a lease liability and corresponding right-of-use asset on our consolidated balance sheets for all of our operating leases. Using the fixed noncancellable term of all existing data center leases, excluding renewal options, we estimate the initial lease liability and right-of-use asset will be approximately $100 million on our consolidated balance sheet as of the transition date. As we continue to evaluate the provisions of ASC Topic 842, we will evaluate our existing renewal options within our data center leases and ultimately conclude as to whether we are, or are not, reasonably certain, based on relevant factors that may create an economic incentive for us, to exercise renewal options for each of our data center leases. If we determine that we are reasonably certain to exercise all renewal options for each lease, we estimate the initial lease liability and right-of-use asset will be approximately $300 million on our consolidated balance sheet as of the transition date. Subject to our evaluation of whether we are reasonably certain to exercise renewal options for each of our data center leases as well as resolution of other implementation items, we estimate our straight-line rental expense could increase up to $1.3 million and $1.2 million within our consolidated statement of operations for the three months ended March 31, 2017, and 2016, respectively. In accordance with ASC Topic 842, lessor accounting for our leases remains largely unchanged, apart from the narrower scope of initial direct costs that can be capitalized. The new standard defines initial direct costs as only incremental costs of signing a lease. Internal sales employees’ compensation, payroll-related fringe benefits and certain external legal fees related to the execution of successful lease agreements will not meet the definition of initial direct costs under the new standard and will be accounted for as a sales and marketing expense in the consolidated statement of operations upon adoption of ASC Topic 842. We estimate sales and marketing expense could increase up to $0.5 million for both the three months ended March 31, 2017, and 2016. We are currently evaluating the other impacts of ASC Topic 842 and ASC Topic 606 on our significant accounting policies and consolidated financial statements. In August 2016, the FASB issued guidance codified in Accounting Standards Update (“ASU”) Topic 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. The standard provides guidance on eight specific cash flow classification issues including debt prepayment or debt extinguishment costs, contingent consideration payments made after a business combination, and separately identifiable cash flows and application of the predominance principle. The standard will be effective for the fiscal year beginning January 1, 2018, and subsequent interim periods. We do not expect the provisions of ASC 2016-15 to have a material impact on our consolidated financial statements. In January 2017, the FASB issued guidance codified in ASU Topic 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. ASU 2017-04 simplifies the accounting for goodwill impairment by eliminating the process of measuring the implied value of goodwill, known as step two, from the goodwill impairment test. Instead, if the carrying amount of a reporting unit exceeds its fair value, an impairment loss shall be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. The standard will be effective for interim and annual reporting periods beginning after December 15, 2019, with early adoption permitted. We do not expect the provisions of ASC 2017-04 to have a material impact on our consolidated financial statements. Use of Estimates 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 the carrying values of our real estate properties, goodwill, accrued liabilities and performance-based equity compensation plans. 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 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 property 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 $0.6 million and $1.1 million for the three months ended March 31, 2017, and 2016, respectively. Depreciation and amortization are calculated using the straight-line method over the following useful lives of the assets: Buildings 27 to 40 years Building improvements 1 to 10 years Leasehold improvements The shorter of the lease term or useful life of the asset Depreciation expense was $26.8 million and $20.1 million for the three months ended March 31, 2017, and 2016, respectively. Acquisition of Investment in Real Estate 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 fair value of the land and building of an acquired property is determined by valuing the property as if it were vacant, and the “as-if-vacant” 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. 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 fair 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 interconnection services and utility services to be provided to the in-place lease tenants. 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. 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, 2017, or 2016. 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, 2017, and December 31, 2016, we had approximately $41.2 million of goodwill at each date. The Company’s 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, 2017, or 2016. Cash and Cash Equivalents 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. Deferred Costs Deferred leasing 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. These commissions and other direct and incremental costs incurred to obtain new customer leases are capitalized and 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 deferred costs related to the lease are written off to amortization expense. Deferred leasing costs are included within other assets in the condensed consolidated balance sheets and consisted of the following, net of amortization, as of March 31, 2017, and December 31, 2016 (in thousands): March 31, December 31, 2017 2016 Internal sales commissions $ 18,493 $ 18,748 Third party commissions 12,883 13,643 External legal counsel 742 730 Total $ 32,118 $ 33,121 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 loan 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 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, 2017, and 2016, no impairment of long-lived assets was recognized. Derivative Instruments and Hedging Activities 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 effective portion of the gain or loss on the hedging instruments as a component of accumulated other comprehensive income or loss. Any ineffective portion of a derivative's change in fair value is immediately recognized within net income. 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 6, Derivatives and Hedging Activities. Internal-Use Software 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 was recognized related to internal-use software in the condensed consolidated statements of operations for the three months ended March 31, 2017, and 2016. Revenue Recognition All customer leases are classified as operating leases and minimum rents are recognized on a straight-line basis over the customer’s lease term. The excess of rents recognized over amounts contractually due pursuant to the underlying leases are included in deferred rent receivable and included in other assets in the condensed consolidated balance sheets. If a lease terminates prior to its stated expiration, the deferred rent receivable relating to that lease is written off as a reduction of rental revenue. When arrangements include multiple elements, the revenue associated with separate elements is allocated based on the relative fair values of those elements. The revenue associated with each element is then recognized as earned. Interconnection services and additional space services are considered as separate earnings processes that are provided and completed on a month-to-month basis and revenue is recognized in the period that services are performed. Customer set-up charges and utility installation fees are initially deferred and recognized over the term of the lease arrangement as revenue. Tenant reimbursements for real estate taxes, common area maintenance, and other recoverable costs are recognized as revenue in the period that the related expenses are incurred. Above-market and below-market lease intangibles that were acquired are amortized on a straight-line basis as decreases and increases, respectively, to rental revenue over the remaining noncancelable term of the underlying leases. For both the three months ended March 31, 2017, and 2016, the net effect of amortization of acquired above-market and below-market leases resulted in an increase to rental revenue of $0.1 million. A provision for uncollectible accounts is recorded if a receivable balance relating to contractual rent, rent recorded on a straight-line basis, tenant reimbursements or other billed amounts is considered by management to be uncollectible. At March 31, 2017, and December 31, 2016, the allowance for doubtful accounts totaled less than $0.1 million and $0.2 million, respectively. Share-Based Compensation 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. Asset Retirement and Environmental Remediation Obligations 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, 2017, and December 31, 2016, the amount included in unearned revenue, prepaid rent and other liabilities on the condensed consolidated balance sheets was approximately $1.4 million. Income Taxes We elected to be taxed as a REIT under the Internal Revenue Code of 1986, as amended (the “Code”), 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, including any applicable alternative minimum tax. 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 regards to activities of the REIT and its subsidiary pass-through entities. The allocable share of taxable income is included in the income tax returns of its stockholders. The Company is subject to the statutory requirements of the locations in which it conducts 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. We have elected to treat certain subsidiaries as taxable REIT subsidiaries (“TRS”). 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 period's 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, 2017, and December 31, 2016, the gross deferred income taxes were not material. We currently have no liabilities for uncertain income tax positions. The earliest tax year for which we are subject to examination is 2013. Concentration of Credit Risks 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 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.

Investment in Real Estate

Investment in Real Estate	3 Months Ended
	Mar. 31, 2017
Investment in Real Estate
Investment in Real Estate	3. Investment in Real Estate The following is a summary of the properties owned or leased by market at March 31, 2017 (in thousands): Buildings and Construction in Market Land Improvements Progress Total Cost Boston $ 5,154 $ 96,604 $ 377 $ 102,135 Chicago 5,493 99,661 8,439 113,593 Denver — 5,413 8,546 13,959 Los Angeles 28,467 240,475 12,268 281,210 Miami 728 10,516 152 11,396 New York 2,388 128,638 39,786 170,812 Northern Virginia (1) 23,642 284,442 26,341 334,425 San Francisco Bay 31,386 609,280 2,786 643,452 Total $ 97,258 $ 1,475,029 $ 98,695 $ 1,670,982 (1) On February 23, 2017, we executed a ten-year lease for 25,000 square feet at a new property, referred to as DC2, to further expand our data center presence in Washington D.C., which is under construction as of March 31, 2017.

Other Assets

Other Assets	3 Months Ended
	Mar. 31, 2017
Other Assets.
Other Assets	4. Other Assets Our other assets consisted of the following, net of amortization and depreciation, if applicable, as of March 31, 2017, and December 31, 2016 (in thousands): March 31, December 31, 2017 2016 Deferred leasing costs $ 32,118 $ 33,121 Deferred rent receivable 37,743 36,393 Internal-use software 15,254 14,440 Prepaid expenses 8,746 4,390 Corporate furniture, fixtures and equipment 6,196 5,356 Deferred financing costs - revolving credit facility 1,442 1,604 Other 1,458 1,068 Total $ 102,957 $ 96,372

Debt

Debt	3 Months Ended
	Mar. 31, 2017
Debt
Debt	5. Debt A summary of outstanding indebtedness as of March 31, 2017, and December 31, 2016, is as follows (in thousands): Maturity March 31, December 31, Interest Rate Date 2017 2016 Revolving credit facility 2.53% and 2.32% at March 31, 2017, and December 31, 2016, respectively June 24, 2019 $ 223,000 $ 194,000 2019 Senior unsecured term loan (1) 3.23% at March 31, 2017, and December 31, 2016 January 31, 2019 100,000 100,000 2020 Senior unsecured term loan (2) 2.71% and 2.60% at March 31, 2017, and December 31, 2016 June 24, 2020 150,000 150,000 2021 Senior unsecured term loan 2.48% and 2.27% at March 31, 2017, and December 31, 2016 February 2, 2021 100,000 100,000 2023 Senior unsecured notes 4.19% at March 31, 2017, and December 31, 2016 June 15, 2023 150,000 150,000 Total principal outstanding 723,000 694,000 Unamortized deferred financing costs (3,343) (3,550) Total debt $ 719,657 $ 690,450 (1) Our Operating Partnership entered into a swap agreement with respect to the 2019 Term Loan (as defined below) to swap the variable interest rate associated with $100 million, or 100%, of the 2019 Term Loan to a fixed rate of approximately 3.23% per annum at our current leverage ratio. See Note 6 – Derivatives and Hedging Activities. (2) Our Operating Partnership entered into a swap agreement with respect to the 2020 Term Loan (as defined below) to swap the variable interest rate associated with $75 million, or 50%, of the principal amount of the 2020 Term Loan to a fixed rate of approximately 2.93% per annum at our current leverage ratio. The interest rate on the remaining $75 million of the 2020 Term Loan is based on LIBOR plus the applicable spread. The effective interest rate as of March 31, 2017, is 2.48%. See Note 6 – Derivatives and Hedging Activities. Subsequent Debt Financing On April 19, 2017, and April 20, 2017, our Operating Partnership executed two separate financing transactions resulting in additional liquidity of $275 million, which will be used to refinance existing debt and for general corporate purposes. The new debt is comprised of a $100 million increase to the current 2019 Term Loan with a new five-year term maturing in April 2022 and the issuance of $175 million of 3.91% senior notes due April 2024. See “2019 Senior Unsecured Term Loan” and “2024 Senior Unsecured Notes” below for additional discussion. Revolving Credit Facility On February 2, 2016, our Operating Partnership and certain subsidiary co-borrowers entered into the first amendment to the third amended and restated credit agreement (as amended, the “Credit Agreement”) with a group of lenders for which KeyBank National Association acts as the administrative agent. The Credit Agreement maturity date is June 24, 2019, with a one-time extension option, which, if exercised, would extend the maturity date to June 24, 2020. The exercise of the extension option is subject to the payment of an extension fee equal to 10 basis points of the total commitment under the Credit Agreement at initial maturity and certain other customary conditions. The Credit Agreement includes a total commitment of $600 million, providing for a $350 million revolving credit facility, a $150 million unsecured term loan scheduled to mature on June 24, 2020, and a $100 million unsecured term loan scheduled to mature on February 2, 2021. See “2020 Senior Unsecured Term Loan” and “2021 Senior Unsecured Term Loan” below for a discussion of the $150 million and $100 million term loans. The Credit Agreement contains an accordion feature, which allows our Operating Partnership to increase the total commitment from $600 million to $800 million, under specified circumstances, including securing capital from new or existing lenders. Borrowings under the revolving credit facility bear interest at a variable rate per annum equal to either (i) LIBOR plus 155 basis points to 225 basis points, or (ii) a base rate plus 55 basis points to 125 basis points, each depending on our Operating Partnership’s leverage ratio. At March 31, 2017, our Operating Partnership’s leverage ratio was 22.4% and the interest rate was LIBOR plus 155 basis points. The total amount available for borrowing under the revolving credit facility, which is part of the Credit Agreement, is equal to the lesser of $350.0 million or the availability calculated based on our unencumbered asset pool. As of March 31, 2017, the borrowing capacity was $350.0 million. As of March 31, 2017, $223.0 million was borrowed and outstanding, $4.5 million was outstanding under letters of credit and therefore $122.5 million remained available for us to borrow under the revolving credit facility. Our ability to borrow under the Credit Agreement is subject to ongoing compliance with a number of financial covenants and other customary restrictive covenants, including, among others: · a maximum leverage ratio (defined as total consolidated indebtedness to total gross asset value) of 60%, which, as of March 31, 2017, was 22.4% · a maximum secured debt ratio (defined as total consolidated secured debt to total gross asset value) of 40%, which, as of March 31, 2017, was 0.0 · a minimum fixed charge coverage ratio (defined as adjusted consolidated earnings before interest, taxes, depreciation and amortization to consolidated fixed charges) of 1.7 to 1.0, which, as of March 31, 2017, was 8.6 to 1.0; and · a maximum unhedged variable rate debt ratio (defined as unhedged variable rate indebtedness to gross asset value) of 30%, which, as of March 31, 2017, our unhedged variable rate debt ratio was 12.2%. As of March 31, 2017, we were in compliance with all of the financial covenants under the Credit Agreement. 2019 Senior Unsecured Term Loan On January 31, 2014, our Operating Partnership and certain subsidiaries entered into a $100 million senior unsecured term loan (the “2019 Term Loan”). The 2019 Term Loan has a five-year term and contains an accordion feature, which allows our Operating Partnership to increase the total commitments by $100 million, to $200 million, under specified circumstances, including securing capital from new or existing lenders. The 2019 Term Loan ranks pari passu with the 2020 Term Loan, the 2021 Term Loan, the 2023 Notes, the 2024 Notes and the Credit Agreement and contains the same financial covenants and other customary restrictive covenants. As of March 31, 2017, we were in compliance with all of the financial covenants under the 2019 Term Loan. The borrowings under the 2019 Term Loan bear interest at a variable rate per annum equal to either (i) LIBOR plus 175 basis points to 265 basis points, or (ii) a base rate plus 75 basis points to 165 basis points, each depending on our Operating Partnership's leverage ratio. At March 31, 2017, our Operating Partnership’s leverage ratio was 22.4% and the interest rate was LIBOR plus 175 basis points. On April 19, 2017, our Operating Partnership and certain subsidiaries amended the 2019 Term Loan to (i) exercise the accordion feature to increase the total commitments to $200 million, (ii) extend the maturity of the facility 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, and (iv) explicitly permit the issuance of the 2024 Notes defined below. All other terms of the 2019 Term Loan remain materially unchanged. 2020 Senior Unsecured Term Loan On June 24, 2015, in connection with, and pursuant to the terms of, the Credit Agreement, our Operating Partnership and certain subsidiaries entered into a $150 million senior unsecured term loan (the “2020 Term Loan”). The 2020 Term Loan has a five-year term maturing on June 24, 2020. The 2020 Term Loan ranks pari passu with the 2019 Term Loan, the 2021 Term Loan, the 2023 Notes and the 2024 Notes and contains the same financial covenants and other customary restrictive covenants. As of March 31, 2017, we were in compliance with all of the financial covenants under the 2020 Term Loan. The borrowings under the 2020 Term Loan bear interest at a variable rate per annum equal to either (i) LIBOR plus 150 basis points to 220 basis points, or (ii) a base rate plus 50 basis points to 120 basis points, each depending on our Operating Partnership's leverage ratio. At March 31, 2017, the Operating Partnership’s leverage ratio was 22.4% and the interest rate was LIBOR plus 150 basis points. 2021 Senior Unsecured Term Loan On February 2, 2016, pursuant to the terms of the Credit Agreement, we partially exercised the accordion feature and entered into a $100 million senior unsecured term loan (the “2021 Term Loan”). The 2021 Term Loan has a five-year term maturing on February 2, 2021. The 2021 Term Loan ranks pari passu with the 2019 Term Loan, the 2020 Term Loan, the 2023 Notes, the 2024 Notes and the Credit Agreement and contains the same financial covenants and other customary restrictive covenants. As of March 31, 2017, we were in compliance with all of the financial covenants under the 2021 Term Loan. The borrowings under the 2021 Term Loan bear interest at a variable rate per annum equal to either (i) LIBOR plus 150 basis points to 220 basis points, or (ii) a base rate plus 50 basis points to 120 basis points, each depending on our Operating Partnership’s leverage ratio. At March 31, 2017, our Operating Partnership’s leverage ratio was 22.4% and the interest rate was LIBOR plus 150 basis points. 2023 Senior Unsecured Notes 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 “2023 Notes”) 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 “2023 Note Purchase Agreement”), by and among our Operating Partnership, the Company and the purchasers named therein. Interest is payable semiannually, on the 15 th day of June and December in each year, commencing on December 15, 2016. The 2023 Notes are senior unsecured obligations of our Operating Partnership and are jointly and severally guaranteed by the Company and each of our Operating Partnership’s subsidiaries that guarantees indebtedness under our Operating Partnership’s Credit Agreement (the “Subsidiary Guarantors”). 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 will have the right to require our Operating Partnership to purchase 100% of such holder’s 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. The 2023 Notes rank pari passu with the 2019 Term Loan, the 2020 Term Loan, the 2021 Term Loan, the 2024 Notes and the Credit Agreement. The 2023 Note Purchase Agreement contains the same financial covenants as the Credit Agreement, as described above. In addition, certain additional financial covenants in the 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. The aforementioned covenants are subject to a number of exceptions and qualifications set forth in the 2023 Note Purchase Agreement. As of March 31, 2017, we were in compliance with all of the financial covenants under the 2023 Note Purchase Agreement. 2024 Senior Unsecured Notes 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 “2024 Notes”) 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 “2024 Note Purchase Agreement”), by and among our Operating Partnership, the Company and the purchasers named therein. Interest is payable semiannually, on the 15 th day of June and December in each year, commencing on December 15, 2017. The 2024 Notes are senior unsecured obligations of our Operating Partnership and are jointly and severally guaranteed by the Company and each of our Operating Partnership’s subsidiaries that guarantees indebtedness under our subsidiary guarantors. Our Operating Partnership may prepay all or a portion of the 2024 Notes upon notice to the holders for 100% of the principal amount so prepaid 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 will have the right to require our Operating Partnership to purchase 100% of such holder’s 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. The 2024 Notes rank pari passu with the 2019 Term Loan, the 2020 Term Loan, the 2021 Term Loan, the 2023 Notes and the Credit Agreement. The 2024 Note Purchase Agreement contains the same financial covenants as the Credit Agreement, as described above. In addition, certain additional financial covenants in the 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 Credit Agreement is so deleted, removed, amended or otherwise modified. The aforementioned covenants are subject to a number of exceptions and qualifications set forth in the 2024 Note Purchase Agreement. Debt Maturities The following table summarizes when our debt currently becomes due, adjusted for the April 2017 debt financing transactions, which includes the amended 2019 Term Loan, the 2024 Notes, and the repayment of the revolving credit facility (in thousands): Year Ending December 31, 2017 $ — 2018 — 2019 — 2020 150,000 2021 100,000 Thereafter 473,000 Total principal outstanding 723,000 Unamortized deferred financing costs (3,343) Total debt, net $ 719,657

Derivatives and Hedging Activit

Derivatives and Hedging Activities	3 Months Ended
	Mar. 31, 2017
Derivatives and Hedging Activities
Derivatives and Hedging Activities	6. Derivatives and Hedging Activities On April 9, 2015, we entered into a $75 million forward starting five-year interest rate swap agreement, effective May 5, 2015, to protect against adverse fluctuation in interest rates. The swap reduces our exposure to variability in cash flows relating to interest payments on $75 million of one-month LIBOR variable rate debt and effectively fixes the interest rate at approximately 2.93% per annum. Also, on February 3, 2014, we entered into a five-year interest rate swap agreement that effectively fixes the interest rate on $100 million of outstanding debt at approximately 3.23% per annum. Both interest rate swap agreements were designated for hedge accounting. On April 21, 2017, we terminated $50 million of our $100 million five-year interest rate swap. Risk Management Objective of Using Derivatives 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. Cash Flow Hedges of Interest Rate Risk 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. The effective portion of changes in the fair value of derivatives designated and that qualify as 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. The amounts recorded in other comprehensive income related to the unrealized loss or gain on derivative contracts were a gain of $0.3 million and a loss of $3.2 million for the three months ended March 31, 2017, and 2016, respectively. The amounts reclassified from other comprehensive income to interest expense on the condensed consolidated statements of operations were $0.3 million and $0.5 million for the three months ended March 31, 2017, and 2016. Any ineffective portion of the change in fair value of the derivatives is recognized directly in net income. During the three months ended March 31, 2017, and 2016, we did not record any amount in net income related to derivatives as there was no hedge ineffectiveness. Amounts reported in accumulated other comprehensive loss 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, 2017, we estimate that $0.4 million will be reclassified as an increase to interest expense. Derivatives are recorded at fair value in our condensed consolidated balance sheets in other assets or unearned revenue, prepaid rent and other liabilities, as applicable. We do not net our derivative position by counterparty for purposes of balance sheet presentation and disclosure. We had $0.1 million and $0.4 million in derivative liabilities recognized in unearned revenue, prepaid rent and other liabilities in our condensed consolidated balance sheets as of March 31, 2017, and December 31, 2016, respectively. We also had a $0.6 million and $0.3 million derivative asset recognized in other assets in our consolidated balance sheets as of March 31, 2017, and December 31, 2016, respectively.

Stockholders' Equity

Stockholders' Equity	3 Months Ended
	Mar. 31, 2017
Stockholders' Equity
Stockholders' Equity	7. Stockholders’ Equity We declared the following dividends per share on our Series A cumulative preferred stock and common stock during the three months ended March 31, 2017: Declaration Date Record Date Payment Date Preferred Stock Common Stock March 9, 2017 March 31, 2017 April 17, 2017 $ 0.4531 (1) $ 0.80 (1) Dividend covers the period from January 15, 2017, to April 14, 2017.

Noncontrolling Interests - Oper

Noncontrolling Interests - Operating Partnership	3 Months Ended
	Mar. 31, 2017
Noncontrolling Interests - Operating Partnership
Noncontrolling Interests - Operating Partnership	8. Noncontrolling Interests — Operating Partnership 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. In connection with the issuance of our 7.25% Series A cumulative redeemable preferred stock on December 12, 2012, our Operating Partnership issued 4,600,000 7.25% Series A cumulative redeemable preferred Operating Partnership units to us. Preferred Operating Partnership units rank senior to the common Operating Partnership units held by both us and noncontrolling interests. The following table shows the ownership interests in our Operating Partnership as of March 31, 2017, and December 31, 2016: March 31, 2017 December 31, 2016 Number of Units Percentage of Total Number of Units Percentage of Total CoreSite Realty Corporation 33,764,350 70.9 % 33,376,568 70.7 % Noncontrolling interests 13,851,347 29.1 13,851,347 29.3 Total 47,615,697 100.0 % 47,227,915 100.0 % 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, 2017, we issued 387,782 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. Holders of common Operating Partnership units of record as of March 31, 2017, received quarterly distributions of $0.80 per unit, payable in correlation with declared dividends on common stock. The redemption value of the noncontrolling interests at March 31, 2017, was $1.2 billion based on the closing price of the Company’s common stock of $90.05 per share on that date.

Equity Incentive Award Plan

Equity Incentive Award Plan	3 Months Ended
	Mar. 31, 2017
Equity Incentive Award Plan
Equity Incentive Plan	9. Equity Incentive Plan Our Board of Directors adopted and, with the approval of our stockholders, amended the 2010 Equity Award Incentive Plan (as amended, the “2010 Plan”). The 2010 Plan is administered by the Compensation Committee of the Board of Directors. Awards issuable under the 2010 Plan include common stock, stock options, restricted stock, 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 which 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. As of March 31, 2017, 3,054,224 shares of our common stock were available for issuance pursuant to the 2010 Plan. Stock Options Stock option awards are granted with an exercise price equal to the closing market price of the Company’s 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 ending December 31, 2013. The following table sets forth stock option activity under the 2010 Plan for the three months ended March 31, 2017: Number of Shares Weighted- Subject to Average Option Exercise Price Options outstanding, December 31, 2016 265,550 $ 22.96 Granted — — Exercised (163,699) 25.50 Forfeited — — Expired — — Options outstanding, March 31, 2017 101,851 $ 19.07 The following table sets forth the number of shares subject to options that are unvested as of March 31, 2017, and the fair value of these options at the grant date: Number of Weighted- Shares Average Fair Subject to Value at Grant Option Date Unvested balance, December 31, 2016 16,323 $ 9.99 Granted — — Forfeited — — Vested (16,323) 9.99 Unvested balance, March 31, 2017 — $ — Restricted Awards and Units Restricted stock awards and restricted stock units, or RSUs, are granted with a fair value equal to the closing market price of the Company’s 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: Weighted- Restricted Average Fair Awards and Value at Grant Units Date Unvested balance, December 31, 2016 323,641 $ 53.84 Granted 126,846 85.51 Forfeited (26,321) 62.23 Vested (117,242) 41.33 Unvested balance, March 31, 2017 306,924 $ 69.48 As of March 31, 2017, total unearned compensation on restricted awards was approximately $20.0 million, and the weighted-average vesting period was 3.0 years. Performance Stock Awards We grant long-term incentives to members of management in the form of performance-based restricted stock awards (“PSAs”) under the 2010 Plan. The number of PSAs earned is based on our achievement of relative total shareholder return (“TSR”) measured versus the MSCI US REIT Index over a three-year performance period and ranges between 0% and 150% of a target number of shares for PSAs granted in 2014 and between 25% and 175% of the target number of shares for PSAs granted in 2015, 2016, and 2017. The PSAs are granted at the maximum percentage of target and are retired annually to the extent we do not achieve maximum relative TSR versus the MSCI US REIT Index. The PSAs are earned upon TSR achievement measured both annually and over the full three-year performance period. The PSAs have a service condition and will be released at the end of the three-year performance period, to the extent earned, provided that the holder continues to be employed by the Company at the end of the three-year performance period. The PSAs are amortized on a straight-line basis to expense over the vesting period. Holders of the PSAs are entitled to dividends on the PSAs, which will be accrued and paid in cash at the end of the three-year performance period. The following table sets forth the number of unvested PSAs and the weighted-average fair value of these awards at the date of grant: Weighted- Average Fair Performance-Based Restricted Stock Awards Value at Grant Minimum Maximum Target Date Unvested balance, December 31, 2016 44,835 167,725 113,976 $ 54.24 Granted 7,143 49,999 28,571 105.30 Performance adjustment (1) 62,841 — 23,725 — Forfeited (5,674) (16,836) (11,255) 79.09 Vested (70,518) (70,518) (70,518) 25.89 Unvested balance, March 31, 2017 38,627 130,370 84,499 $ 84.49 (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. As of March 31, 2017, total unearned compensation on PSAs was approximately $5.1 million, and the weighted-average vesting period was 2.5 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, 2017, and 2016. Three Months Ended March 31, 2017 2016 Expected term (in years) 2.81 2.83 Expected volatility 23.33 % 25.29 % Expected annual dividend (1) — — Risk-free rate 1.60 % 0.97 % (1) The fair value of the PSAs assumes reinvestment of dividends.

Earnings Per Share

Earnings Per Share	3 Months Ended
	Mar. 31, 2017
Earnings Per Share
Earnings Per Share	10. Earnings Per Share 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. The following is a summary of basic and diluted net income per share (in thousands, except share and per share amounts): Three Months Ended March 31, 2017 2016 Net income attributable to common shares $ 16,292 $ 11,261 Weighted-average common shares outstanding - basic 33,558,787 30,252,693 Effect of potentially dilutive common shares: Stock options 156,035 200,379 Unvested awards 266,954 241,675 Weighted-average common shares outstanding - diluted 33,981,776 30,694,747 Net income per share attributable to common shares Basic $ 0.49 $ 0.37 Diluted $ 0.48 $ 0.37 In the calculations above, we have excluded weighted-average potentially dilutive securities of 39,937 and 59,408 for the three months ended March 31, 2017, and 2016, respectively, as their effect would have been antidilutive.

Estimated Fair Value of Financi

Estimated Fair Value of Financial Instruments	3 Months Ended
	Mar. 31, 2017
Estimated Fair Value of Financial Instruments
Estimated Fair Value of Financial Instruments	11. Estimated Fair Value of Financial Instruments 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: Level 1 — Quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity can access at the assessment date. Level 2 — Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3 — Unobservable inputs for the asset or liability. 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. 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, 2017, 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. The total principal balance of our revolving credit facility, senior unsecured term loans, and senior unsecured notes was $723.0 million and $694.0 million as of March 31, 2017, and December 31, 2016, respectively, with a fair value of $725.8 million and $673.0 million, respectively, based on Level 3 inputs from the fair value hierarchy. Under the discounted cash flow method, the fair values of the revolving credit facility and the senior unsecured term loans are based on our assumptions of market interest rates and terms available incorporating our credit risk for similar loan maturities.

Commitments and Contingencies

Commitments and Contingencies	3 Months Ended
	Mar. 31, 2017
Commitments and Contingencies.
Commitments and Contingencies	12. Commitments and Contingencies 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, 2017, we had open commitments related to construction contracts of approximately $16.3 million. 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, 2017, we had open commitments related to these contracts of approximately $10.4 million. We entered into a Memorandum of Understanding with the Virginia Economic Development Partnership Authority (the “Virginia Memorandum of Understanding”) pursuant to which we are afforded the opportunity to benefit from an exemption from sales and use tax for certain qualifying data center related purchases and equipment leases. This exemption also extends to our customers who execute a Landlord-Tenant Participation Agreement under the Virginia Memorandum of Understanding. The Virginia Memorandum of Understanding establishes thresholds relating to the level of capital investment and qualifying new jobs created within the Commonwealth of Virginia by us and our customers who have agreed to sign participation agreements. In the event those thresholds are not met as of the agreed upon performance date of June 1, 2017, we would be required to repay the sales and use tax benefit we have received, as well as any tax benefit received by our customers who default on their obligation to repay the tax benefit they have received under the exemption program up to a maximum of $7.5 million. We estimate that we may be required to repay between $0.0 million and $4.0 million for sales and use tax benefits we have received under the exemption program, of which none has been accrued in accounts payable and accrued expenses in our condensed consolidated balance sheets as of March 31, 2017, and December 31, 2016, as we believe we will meet the thresholds as of the June 1, 2017, performance date. In the ordinary course of business, we are subject to claims and administrative proceedings. Except as described below, 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. On February 4, 2014, U.S. Colo, LLC (“U.S. Colo”), a current customer, filed a complaint against us in the United States District Court for the Central District of California. In the complaint, U.S. Colo alleged that it should not have been charged for the use of various interconnection services under the terms of an existing agreement between the parties. On July 23, 2015, after amendments to the complaint, dismissal of several of U.S. Colo’s claims, and a remand of the case to the Superior Court of the State of California, County of Los Angeles (the “Superior Court”), U.S. Colo filed an amended complaint alleging breach of contract and breach of the covenant of good faith and fair dealing. The amended complaint seeks $802,564 in damages for charges paid to us for interconnection services; $70,080,000 in damages for alleged losses of revenue and profits; attorney’s fees, interest, and costs of the suit; and declaratory and injunctive relief. On February 4, 2016, the Superior Court granted our motion for summary adjudication, finding that U.S. Colo had contractually waived all claims for lost revenue or profits or other consequential damages. The case was set to start trial on August 29, 2016, but upon unopposed application, the Superior Court vacated the August 29, 2016, trial date, continued the trial date to July 24, 2017, set a final status conference for July 14, 2017, and reset other procedural deadlines in the action. On April 7, 2017, US Colo filed another unopposed application to further continue the trial date. We intend to vigorously defend this legal proceeding. On July 9, 2015, a purported class action lawsuit was filed in the Superior Court of the State of California, County of Los Angeles, against us, alleging various employment law violations related to overtime, meal and break periods, minimum wage, timely payment of wages, wage statements, payroll records and business expenses. On March 15, 2016, we filed a responsive pleading generally denying the allegations. On July 27, 2016, the parties entered into a Memorandum of Understanding, pursuant to which the parties agreed to settle the lawsuit. The settlement, which remains subject to Superior Court approval, resolves the matter on a class-wide basis, on behalf of all non-exempt employees in California, as well a related class action lawsuit filed on July 22, 2016, alleging similar claims, in exchange for a $600,000 payment to be made by us. A hearing for Superior Court approval of the settlement has been scheduled for June 5, 2017. There can be no assurance that the settlement will be finally approved by the Superior Court. We intend to vigorously defend this legal proceeding if the settlement is not approved. While it is not feasible to predict or determine the outcome of these legal proceedings, as of March 31, 2017, we estimate that the ultimate resolution of these litigation matters and other disputes could result in a loss that is reasonably possible between $0.6 million and $3.1 million in the aggregate, of which $2.9 million has been accrued in accounts payable and accrued expenses in our consolidated balance sheet as of March 31, 2017.

Summary of Significant Accoun20

Summary of Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2017
Summary of Significant Accounting Policies
Principles of Consolidation and Basis of Presentation	Principles of Consolidation and Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared by our management in accordance with U.S. generally accepted accounting principles (“GAAP”) 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, 2017, are not necessarily indicative of the expected results for the year ending December 31, 2017. 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 for the year ended December 31, 2016. Intercompany balances and transactions have been eliminated upon consolidation.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued guidance codified in Accounting Standards Codification (“ASC”) Topic 606, Revenue Recognition — Revenue from Contracts with Customers, which amends the guidance in former ASC 605, Revenue Recognition. The standard establishes a five-step model framework which recognizes revenue as an entity transfers control of goods or services to the customer and requires enhanced disclosures. This standard does not apply to leases, which will be accounted for under ASC Topic 842, Leases. The revenue standard is effective for interim and annual reporting periods beginning after December 15, 2017. The standard permits the use of either the retrospective or cumulative effect transition method. As ASC Topic 606 does not impact lessor accounting, we do not believe this standard will significantly impact our accounting for rental revenue. In addition, we do not anticipate a significant impact to our accounting for power, interconnection, tenant reimbursement and other revenue. In February 2016, the FASB issued guidance codified in ASC Topic 842, Leases , which amends the guidance in former ASC 840, Leases. The main principle of ASC 842 requires lessees to recognize the assets and liabilities that arise from nearly all leases on the consolidated balance sheet. Lessor accounting remains mainly consistent with current guidance, with the majority of changes allowing for better alignment with the new lessee model and ASC Topic 606. The standard is effective for interim and annual reporting periods beginning after December 15, 2018, with early adoption permitted. The standard requires a modified retrospective transition approach. We plan to adopt ASC Topic 842 and ASC Topic 606 effective January 1, 2018, which will result in a transition date of January 1, 2016. As a lessee we do not anticipate the classification of our leases to change, but we will be required to recognize a lease liability and corresponding right-of-use asset on our consolidated balance sheets for all of our operating leases. Using the fixed noncancellable term of all existing data center leases, excluding renewal options, we estimate the initial lease liability and right-of-use asset will be approximately $100 million on our consolidated balance sheet as of the transition date. As we continue to evaluate the provisions of ASC Topic 842, we will evaluate our existing renewal options within our data center leases and ultimately conclude as to whether we are, or are not, reasonably certain, based on relevant factors that may create an economic incentive for us, to exercise renewal options for each of our data center leases. If we determine that we are reasonably certain to exercise all renewal options for each lease, we estimate the initial lease liability and right-of-use asset will be approximately $300 million on our consolidated balance sheet as of the transition date. Subject to our evaluation of whether we are reasonably certain to exercise renewal options for each of our data center leases as well as resolution of other implementation items, we estimate our straight-line rental expense could increase up to $1.3 million and $1.2 million within our consolidated statement of operations for the three months ended March 31, 2017, and 2016, respectively. In accordance with ASC Topic 842, lessor accounting for our leases remains largely unchanged, apart from the narrower scope of initial direct costs that can be capitalized. The new standard defines initial direct costs as only incremental costs of signing a lease. Internal sales employees’ compensation, payroll-related fringe benefits and certain external legal fees related to the execution of successful lease agreements will not meet the definition of initial direct costs under the new standard and will be accounted for as a sales and marketing expense in the consolidated statement of operations upon adoption of ASC Topic 842. We estimate sales and marketing expense could increase up to $0.5 million for both the three months ended March 31, 2017, and 2016. We are currently evaluating the other impacts of ASC Topic 842 and ASC Topic 606 on our significant accounting policies and consolidated financial statements. In August 2016, the FASB issued guidance codified in Accounting Standards Update (“ASU”) Topic 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. The standard provides guidance on eight specific cash flow classification issues including debt prepayment or debt extinguishment costs, contingent consideration payments made after a business combination, and separately identifiable cash flows and application of the predominance principle. The standard will be effective for the fiscal year beginning January 1, 2018, and subsequent interim periods. We do not expect the provisions of ASC 2016-15 to have a material impact on our consolidated financial statements. In January 2017, the FASB issued guidance codified in ASU Topic 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. ASU 2017-04 simplifies the accounting for goodwill impairment by eliminating the process of measuring the implied value of goodwill, known as step two, from the goodwill impairment test. Instead, if the carrying amount of a reporting unit exceeds its fair value, an impairment loss shall be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. The standard will be effective for interim and annual reporting periods beginning after December 15, 2019, with early adoption permitted. We do not expect the provisions of ASC 2017-04 to have a material impact on our consolidated financial statements.
Use of Estimates	Use of Estimates 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 the carrying values of our real estate properties, goodwill, accrued liabilities and performance-based equity compensation plans. 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 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 property 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 $0.6 million and $1.1 million for the three months ended March 31, 2017, and 2016, respectively. Depreciation and amortization are calculated using the straight-line method over the following useful lives of the assets: Buildings 27 to 40 years Building improvements 1 to 10 years Leasehold improvements The shorter of the lease term or useful life of the asset Depreciation expense was $26.8 million and $20.1 million for the three months ended March 31, 2017, and 2016, respectively.
Acquisition of Investment in Real Estate	Acquisition of Investment in Real Estate 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 fair value of the land and building of an acquired property is determined by valuing the property as if it were vacant, and the “as-if-vacant” 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. 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 fair 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 interconnection services and utility services to be provided to the in-place lease tenants. 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. 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, 2017, or 2016. 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, 2017, and December 31, 2016, we had approximately $41.2 million of goodwill at each date. The Company’s 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, 2017, or 2016.
Cash and Cash Equivalents	Cash and Cash Equivalents 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.
Deferred Costs	Deferred Costs Deferred leasing 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. These commissions and other direct and incremental costs incurred to obtain new customer leases are capitalized and 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 deferred costs related to the lease are written off to amortization expense. Deferred leasing costs are included within other assets in the condensed consolidated balance sheets and consisted of the following, net of amortization, as of March 31, 2017, and December 31, 2016 (in thousands): March 31, December 31, 2017 2016 Internal sales commissions $ 18,493 $ 18,748 Third party commissions 12,883 13,643 External legal counsel 742 730 Total $ 32,118 $ 33,121 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 loan 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 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, 2017, and 2016, no impairment of long-lived assets was recognized.
Derivative Instruments and Hedging Activities	Derivative Instruments and Hedging Activities 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 effective portion of the gain or loss on the hedging instruments as a component of accumulated other comprehensive income or loss. Any ineffective portion of a derivative's change in fair value is immediately recognized within net income. 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 6, Derivatives and Hedging Activities.
Internal-Use Software	Internal-Use Software 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 was recognized related to internal-use software in the condensed consolidated statements of operations for the three months ended March 31, 2017, and 2016.
Revenue Recognition	Revenue Recognition All customer leases are classified as operating leases and minimum rents are recognized on a straight-line basis over the customer’s lease term. The excess of rents recognized over amounts contractually due pursuant to the underlying leases are included in deferred rent receivable and included in other assets in the condensed consolidated balance sheets. If a lease terminates prior to its stated expiration, the deferred rent receivable relating to that lease is written off as a reduction of rental revenue. When arrangements include multiple elements, the revenue associated with separate elements is allocated based on the relative fair values of those elements. The revenue associated with each element is then recognized as earned. Interconnection services and additional space services are considered as separate earnings processes that are provided and completed on a month-to-month basis and revenue is recognized in the period that services are performed. Customer set-up charges and utility installation fees are initially deferred and recognized over the term of the lease arrangement as revenue. Tenant reimbursements for real estate taxes, common area maintenance, and other recoverable costs are recognized as revenue in the period that the related expenses are incurred. Above-market and below-market lease intangibles that were acquired are amortized on a straight-line basis as decreases and increases, respectively, to rental revenue over the remaining noncancelable term of the underlying leases. For both the three months ended March 31, 2017, and 2016, the net effect of amortization of acquired above-market and below-market leases resulted in an increase to rental revenue of $0.1 million. A provision for uncollectible accounts is recorded if a receivable balance relating to contractual rent, rent recorded on a straight-line basis, tenant reimbursements or other billed amounts is considered by management to be uncollectible. At March 31, 2017, and December 31, 2016, the allowance for doubtful accounts totaled less than $0.1 million and $0.2 million, respectively.
Share-Based Compensation	Share-Based Compensation 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.
Asset Retirement and Environmental Remediation Obligations	Asset Retirement and Environmental Remediation Obligations 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, 2017, and December 31, 2016, the amount included in unearned revenue, prepaid rent and other liabilities on the condensed consolidated balance sheets was approximately $1.4 million
Income Taxes	Income Taxes We elected to be taxed as a REIT under the Internal Revenue Code of 1986, as amended (the “Code”), 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, including any applicable alternative minimum tax. 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 regards to activities of the REIT and its subsidiary pass-through entities. The allocable share of taxable income is included in the income tax returns of its stockholders. The Company is subject to the statutory requirements of the locations in which it conducts 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. We have elected to treat certain subsidiaries as taxable REIT subsidiaries (“TRS”). 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 period's 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, 2017, and December 31, 2016, the gross deferred income taxes were not material. We currently have no liabilities for uncertain income tax positions. The earliest tax year for which we are subject to examination is 2013.
Concentration of Credit Risks	Concentration of Credit Risks 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 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.

Summary of Significant Accoun21

Summary of Significant Accounting Policies (Tables)	3 Months Ended
	Mar. 31, 2017
Summary of Significant Accounting Policies
Schedule of useful lives of real estate investment assets	Buildings 27 to 40 years Building improvements 1 to 10 years Leasehold improvements The shorter of the lease term or useful life of the asset
Schedule of deferred leasing costs, net of amortization	Deferred leasing costs are included within other assets in the condensed consolidated balance sheets and consisted of the following, net of amortization, as of March 31, 2017, and December 31, 2016 (in thousands): March 31, December 31, 2017 2016 Internal sales commissions $ 18,493 $ 18,748 Third party commissions 12,883 13,643 External legal counsel 742 730 Total $ 32,118 $ 33,121

Investment in Real Estate (Tabl

Investment in Real Estate (Tables)	3 Months Ended
	Mar. 31, 2017
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, 2017 (in thousands): Buildings and Construction in Market Land Improvements Progress Total Cost Boston $ 5,154 $ 96,604 $ 377 $ 102,135 Chicago 5,493 99,661 8,439 113,593 Denver — 5,413 8,546 13,959 Los Angeles 28,467 240,475 12,268 281,210 Miami 728 10,516 152 11,396 New York 2,388 128,638 39,786 170,812 Northern Virginia (1) 23,642 284,442 26,341 334,425 San Francisco Bay 31,386 609,280 2,786 643,452 Total $ 97,258 $ 1,475,029 $ 98,695 $ 1,670,982 (1) On February 23, 2017, we executed a ten-year lease for 25,000 square feet at a new property, referred to as DC2, to further expand our data center presence in Washington D.C., which is under construction as of March 31, 2017.

Other Assets (Tables)

Other Assets (Tables)	3 Months Ended
	Mar. 31, 2017
Other Assets.
Schedule of other assets	Our other assets consisted of the following, net of amortization and depreciation, if applicable, as of March 31, 2017, and December 31, 2016 (in thousands): March 31, December 31, 2017 2016 Deferred leasing costs $ 32,118 $ 33,121 Deferred rent receivable 37,743 36,393 Internal-use software 15,254 14,440 Prepaid expenses 8,746 4,390 Corporate furniture, fixtures and equipment 6,196 5,356 Deferred financing costs - revolving credit facility 1,442 1,604 Other 1,458 1,068 Total $ 102,957 $ 96,372

Debt (Tables)

Debt (Tables)	3 Months Ended
	Mar. 31, 2017
Debt
Summary of outstanding indebtedness	A summary of outstanding indebtedness as of March 31, 2017, and December 31, 2016, is as follows (in thousands): Maturity March 31, December 31, Interest Rate Date 2017 2016 Revolving credit facility 2.53% and 2.32% at March 31, 2017, and December 31, 2016, respectively June 24, 2019 $ 223,000 $ 194,000 2019 Senior unsecured term loan (1) 3.23% at March 31, 2017, and December 31, 2016 January 31, 2019 100,000 100,000 2020 Senior unsecured term loan (2) 2.71% and 2.60% at March 31, 2017, and December 31, 2016 June 24, 2020 150,000 150,000 2021 Senior unsecured term loan 2.48% and 2.27% at March 31, 2017, and December 31, 2016 February 2, 2021 100,000 100,000 2023 Senior unsecured notes 4.19% at March 31, 2017, and December 31, 2016 June 15, 2023 150,000 150,000 Total principal outstanding 723,000 694,000 Unamortized deferred financing costs (3,343) (3,550) Total debt $ 719,657 $ 690,450 (1) Our Operating Partnership entered into a swap agreement with respect to the 2019 Term Loan (as defined below) to swap the variable interest rate associated with $100 million, or 100%, of the 2019 Term Loan to a fixed rate of approximately 3.23% per annum at our current leverage ratio. See Note 6 – Derivatives and Hedging Activities. (2) Our Operating Partnership entered into a swap agreement with respect to the 2020 Term Loan (as defined below) to swap the variable interest rate associated with $75 million, or 50%, of the principal amount of the 2020 Term Loan to a fixed rate of approximately 2.93% per annum at our current leverage ratio. The interest rate on the remaining $75 million of the 2020 Term Loan is based on LIBOR plus the applicable spread. The effective interest rate as of March 31, 2017, is 2.48%. See Note 6 – Derivatives and Hedging Activities.
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, adjusted for the April 2017 debt financing transactions, which includes the amended 2019 Term Loan, the 2024 Notes, and the repayment of the revolving credit facility (in thousands): Year Ending December 31, 2017 $ — 2018 — 2019 — 2020 150,000 2021 100,000 Thereafter 473,000 Total principal outstanding 723,000 Unamortized deferred financing costs (3,343) Total debt, net $ 719,657

Stockholders' Equity (Tables)

Stockholders' Equity (Tables)	3 Months Ended
	Mar. 31, 2017
Stockholders' Equity
Schedule of dividends paid per share on Series A Cumulative Preferred Stock and common shares	Declaration Date Record Date Payment Date Preferred Stock Common Stock March 9, 2017 March 31, 2017 April 17, 2017 $ 0.4531 (1) $ 0.80 (1) Dividend covers the period from January 15, 2017, to April 14, 2017.

Noncontrolling Interests - Op26

Noncontrolling Interests - Operating Partnership (Tables)	3 Months Ended
	Mar. 31, 2017
Noncontrolling Interests - Operating Partnership
Schedule of ownership interests in our Operating Partnership	March 31, 2017 December 31, 2016 Number of Units Percentage of Total Number of Units Percentage of Total CoreSite Realty Corporation 33,764,350 70.9 % 33,376,568 70.7 % Noncontrolling interests 13,851,347 29.1 13,851,347 29.3 Total 47,615,697 100.0 % 47,227,915 100.0 %

Equity Incentive Award Plan (Ta

Equity Incentive Award Plan (Tables)	3 Months Ended
	Mar. 31, 2017
Equity Incentive Award Plan
Schedule of stock option activity	Number of Shares Weighted- Subject to Average Option Exercise Price Options outstanding, December 31, 2016 265,550 $ 22.96 Granted — — Exercised (163,699) 25.50 Forfeited — — Expired — — Options outstanding, March 31, 2017 101,851 $ 19.07
Schedule of unvested shares subject to options	Number of Weighted- Shares Average Fair Subject to Value at Grant Option Date Unvested balance, December 31, 2016 16,323 $ 9.99 Granted — — Forfeited — — Vested (16,323) 9.99 Unvested balance, March 31, 2017 — $ —
Schedule of restricted awards and RSUs	Weighted- Restricted Average Fair Awards and Value at Grant Units Date Unvested balance, December 31, 2016 323,641 $ 53.84 Granted 126,846 85.51 Forfeited (26,321) 62.23 Vested (117,242) 41.33 Unvested balance, March 31, 2017 306,924 $ 69.48
Schedule of unvested PSAs and their weighted-average fair value at the date of grant	Weighted- Average Fair Performance-Based Restricted Stock Awards Value at Grant Minimum Maximum Target Date Unvested balance, December 31, 2016 44,835 167,725 113,976 $ 54.24 Granted 7,143 49,999 28,571 105.30 Performance adjustment (1) 62,841 — 23,725 — Forfeited (5,674) (16,836) (11,255) 79.09 Vested (70,518) (70,518) (70,518) 25.89 Unvested balance, March 31, 2017 38,627 130,370 84,499 $ 84.49 (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	Three Months Ended March 31, 2017 2016 Expected term (in years) 2.81 2.83 Expected volatility 23.33 % 25.29 % Expected annual dividend (1) — — Risk-free rate 1.60 % 0.97 % The fair value of the PSAs assumes reinvestment of dividends.

Earnings Per Share (Tables)

Earnings Per Share (Tables)	3 Months Ended
	Mar. 31, 2017
Earnings Per Share
Summary of basic and diluted income per share	The following is a summary of basic and diluted net income per share (in thousands, except share and per share amounts): Three Months Ended March 31, 2017 2016 Net income attributable to common shares $ 16,292 $ 11,261 Weighted-average common shares outstanding - basic 33,558,787 30,252,693 Effect of potentially dilutive common shares: Stock options 156,035 200,379 Unvested awards 266,954 241,675 Weighted-average common shares outstanding - diluted 33,981,776 30,694,747 Net income per share attributable to common shares Basic $ 0.49 $ 0.37 Diluted $ 0.48 $ 0.37

Organization (Details)

Organization (Details) - Operating partnership	Mar. 31, 2017
Organization
Percentage of ownership interests held by the entity	70.90%
Percentage of ownership interests held by others	29.10%

Summary of Significant Accoun30

Summary of Significant Accounting Policies (Details) - ASU 2016-02 - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Jan. 01, 2016
Recent Accounting Pronouncements
Estimated increase in straight-line rental expense	$ 1.3	$ 1.2
Lease costs in sales and marketing expense	$ 0.5	$ 0.5
Minimum
Recent Accounting Pronouncements
Right of use asset			$ 100
Right of use liability			100
Maximum
Recent Accounting Pronouncements
Right of use asset			300
Right of use liability			$ 300

Summary of Significant Accoun31

Summary of Significant Accounting Policies - Real Estate (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Investments in Real Estate
Capitalized interest costs	$ 0.6	$ 1.1
Depreciation expense	$ 26.8	$ 20.1
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 Accoun32

Summary of Significant Accounting Policies - Deferred Costs & Impairment (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2016
Summary of Significant Accounting Policies
Impairment loss related to intangible assets	$ 0	$ 0
Goodwill	41,191		$ 41,191
Impairment loss related to goodwill	0	0
Deferred Costs
Internal sales commissions	18,493		18,748
Third party commissions	12,883		13,643
External legal counsel	742		730
Total	32,118		$ 33,121
Recoverability of Long-Lived Assets
Impairment of real estate	$ 0	$ 0

Summary of Significant Accoun33

Summary of Significant Accounting Policies - Internal Use Software, RR & IT (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2016
Internal-Use Software
Recognized impairment of internal use software	$ 0	$ 0
Revenue Recognition
Increase to rental revenue	100	$ 100
Allowance for doubtful accounts (in dollars)	30		$ 209
Asset Retirement and Environmental Remediation Obligations
Asset retirement and environmental remediation obligations	$ 1,400		$ 1,400
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 Accoun34

Summary of Significant Accounting Policies - Concentration of Credit Risks & Segment Information (Details)	3 Months Ended
	Mar. 31, 2017segmentitem
Summary of Significant Accounting Policies
Number of off-balance-sheet concentrations of credit risk | item	0
Segment information
Number of reportable segments | segment	1

Investment in Real Estate (Deta

Investment in Real Estate (Details) $ in Thousands	Feb. 23, 2017ft²	Mar. 31, 2017USD ($)	Dec. 31, 2016USD ($)
Investment in Real Estate
Land		$ 97,258	$ 100,258
Buildings and Improvements		1,475,029	1,472,580
Construction in progress		98,695	$ 70,738
Total investments in real estate		1,670,982
Length of lease	10 years
Net leased space | ft²	25,000
Boston
Investment in Real Estate
Land		5,154
Buildings and Improvements		96,604
Construction in progress		377
Total investments in real estate		102,135
Chicago
Investment in Real Estate
Land		5,493
Buildings and Improvements		99,661
Construction in progress		8,439
Total investments in real estate		113,593
Denver
Investment in Real Estate
Buildings and Improvements		5,413
Construction in progress		8,546
Total investments in real estate		13,959
Los Angeles
Investment in Real Estate
Land		28,467
Buildings and Improvements		240,475
Construction in progress		12,268
Total investments in real estate		281,210
Miami
Investment in Real Estate
Land		728
Buildings and Improvements		10,516
Construction in progress		152
Total investments in real estate		11,396
New York
Investment in Real Estate
Land		2,388
Buildings and Improvements		128,638
Construction in progress		39,786
Total investments in real estate		170,812
Northern Virginia
Investment in Real Estate
Land		23,642
Buildings and Improvements		284,442
Construction in progress		26,341
Total investments in real estate		334,425
San Francisco Bay
Investment in Real Estate
Land		31,386
Buildings and Improvements		609,280
Construction in progress		2,786
Total investments in real estate		$ 643,452

Other Assets (Details)

Other Assets (Details) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Other Assets.
Deferred leasing costs	$ 32,118	$ 33,121
Deferred rent receivable	37,743	36,393
Internal-use software	15,254	14,440
Prepaid expense	8,746	4,390
Corporate furniture, fixtures and equipment	6,196	5,356
Deferred financing costs - revolving credit facility	1,442	1,604
Other	1,458	1,068
Total	$ 102,957	$ 96,372

Debt - Summary of Debt (Details

Debt - Summary of Debt (Details) $ in Thousands	Feb. 02, 2016	Jun. 24, 2015	Jan. 31, 2014	Apr. 30, 2017USD ($)item	Apr. 19, 2017USD ($)	Mar. 31, 2017USD ($)	Dec. 31, 2016USD ($)
Debt
Total principal outstanding						$ 723,000	$ 694,000
Unamortized deferred financing costs						(3,343)	(3,550)
Total debt						$ 719,657	$ 690,450
Number of financing transactions | item				2
Increase in debt				$ 275,000
Revolving Credit Facility
Debt
Interest rate as of reporting date (as a percent)						2.53%	2.32%
Total principal outstanding						$ 223,000	$ 194,000
2019 Senior Unsecured Term Loan
Debt
Term of loan facility				5 years
2019 Senior Unsecured Term Loan | Senior Unsecured Term Loan
Debt
Interest rate as of reporting date (as a percent)						3.23%	3.23%
Total principal outstanding						$ 100,000	$ 100,000
2020 Senior Unsecured Term Loan | Senior Unsecured Term Loan
Debt
Interest rate as of reporting date (as a percent)						2.71%	2.60%
Total principal outstanding						$ 150,000	$ 150,000
2021 Senior Unsecured Term Loan | Senior Unsecured Term Loan
Debt
Interest rate as of reporting date (as a percent)						2.48%	2.27%
Total principal outstanding						$ 100,000	$ 100,000
2023 Senior Unsecured Term Loan | Senior Unsecured Notes
Debt
Interest rate as of reporting date (as a percent)						4.19%	4.19%
Total principal outstanding						$ 150,000	$ 150,000
Operating partnership | 2019 Senior Unsecured Term Loan | Interest Rate Swap
Debt
Amount borrowed under term loan or revolving credit facility						$ 100,000
Percentage of debt hedged						100.00%
Derivative, Fixed Interest Rate						3.23%
Operating partnership | 2019 Senior Unsecured Term Loan | Senior Unsecured Term Loan
Debt
Amount borrowed under term loan or revolving credit facility					$ 200,000
Term of loan facility			5 years
Operating partnership | 2020 Senior Unsecured Term Loan | Interest Rate Swap
Debt
Interest rate as of reporting date (as a percent)						2.48%
Amount borrowed under term loan or revolving credit facility						$ 75,000
Percentage of debt hedged						50.00%
Derivative, Fixed Interest Rate						2.93%
Operating partnership | 2020 Senior Unsecured Term Loan | Senior Unsecured Term Loan
Debt
Term of loan facility		5 years
Operating partnership | 2021 Senior Unsecured Term Loan | Senior Unsecured Term Loan
Debt
Term of loan facility	5 years

Debt - Revolving Credit Facilit

Debt - Revolving Credit Facility (Details) $ in Millions	Feb. 02, 2016USD ($)item	Jun. 24, 2015USD ($)	Mar. 31, 2017USD ($)
Credit Agreement
Debt
Leverage ratio (as a percent)			22.40%
Secured debt ratio (as a percent)			0.00%
Fixed charge coverage ratio			8.6
Unhedged variable rate debt ratio (as a percent)			12.20%
Credit Agreement | Minimum
Debt
Fixed charge coverage ratio			1.70
Credit Agreement | Maximum
Debt
Leverage ratio (as a percent)			0.60%
Secured debt ratio (as a percent)			0.40%
Unhedged variable rate debt ratio (as a percent)			0.30%
Operating partnership | LIBOR
Debt
Interest rate margin (as a percent)			1.55%
Operating partnership | Credit Agreement
Debt
Number of options available for extensions | item	1
Extension fee (as a percent)	0.10%
Maximum borrowing capacity	$ 600
Maximum borrowing capacity including accordion feature	800
Borrowing capacity at end of period			$ 350
Letters of credit outstanding			4.5
Amount available for borrowing under the facility			122.5
Operating partnership | Credit Agreement | Revolving Credit Facility
Debt
Maximum borrowing capacity	350
Borrowed and outstanding			$ 223
Operating partnership | Credit Agreement | Revolving Credit Facility | LIBOR | Minimum
Debt
Interest rate margin (as a percent)			1.55%
Operating partnership | Credit Agreement | Revolving Credit Facility | LIBOR | Maximum
Debt
Interest rate margin (as a percent)			2.25%
Operating partnership | Credit Agreement | Revolving Credit Facility | Base Rate | Minimum
Debt
Interest rate margin (as a percent)			0.55%
Operating partnership | Credit Agreement | Revolving Credit Facility | Base Rate | Maximum
Debt
Interest rate margin (as a percent)			1.25%
Operating partnership | 2020 Senior Unsecured Term Loan | LIBOR
Debt
Interest rate margin (as a percent)			1.50%
Operating partnership | 2020 Senior Unsecured Term Loan | LIBOR | Minimum
Debt
Interest rate margin (as a percent)			1.50%
Operating partnership | 2020 Senior Unsecured Term Loan | LIBOR | Maximum
Debt
Interest rate margin (as a percent)			2.20%
Operating partnership | 2020 Senior Unsecured Term Loan | Base Rate | Minimum
Debt
Interest rate margin (as a percent)			0.50%
Operating partnership | 2020 Senior Unsecured Term Loan | Base Rate | Maximum
Debt
Interest rate margin (as a percent)			1.20%
Operating partnership | 2020 Senior Unsecured Term Loan | Senior Unsecured Term Loan
Debt
Term of loan facility		5 years
Unsecured term loan	$ 150	$ 150
Operating partnership | 2021 Senior Unsecured Term Loan | LIBOR
Debt
Interest rate margin (as a percent)			1.50%
Operating partnership | 2021 Senior Unsecured Term Loan | LIBOR | Minimum
Debt
Interest rate margin (as a percent)			1.50%
Operating partnership | 2021 Senior Unsecured Term Loan | LIBOR | Maximum
Debt
Interest rate margin (as a percent)			2.20%
Operating partnership | 2021 Senior Unsecured Term Loan | Base Rate | Minimum
Debt
Interest rate margin (as a percent)			0.50%
Operating partnership | 2021 Senior Unsecured Term Loan | Base Rate | Maximum
Debt
Interest rate margin (as a percent)			1.20%
Operating partnership | 2021 Senior Unsecured Term Loan | Senior Unsecured Term Loan
Debt
Term of loan facility	5 years
Unsecured term loan	$ 100

Debt - Unsecured Debt (Details)

Debt - Unsecured Debt (Details) - USD ($) $ in Millions	Feb. 02, 2016	Jun. 24, 2015	Jan. 31, 2014	Apr. 30, 2017	Mar. 31, 2017	Apr. 20, 2017	Apr. 19, 2017	Jun. 15, 2016
2019 Senior Unsecured Term Loan
Debt
Term of loan facility				5 years
Operating partnership | LIBOR
Debt
Interest rate margin (as a percent)					1.55%
Operating partnership | 2019 Senior Unsecured Term Loan | LIBOR
Debt
Interest rate margin (as a percent)					1.75%
Operating partnership | 2019 Senior Unsecured Term Loan | LIBOR | Minimum
Debt
Interest rate margin (as a percent)					1.75%
Operating partnership | 2019 Senior Unsecured Term Loan | LIBOR | Maximum
Debt
Interest rate margin (as a percent)					2.65%
Operating partnership | 2019 Senior Unsecured Term Loan | Base Rate | Minimum
Debt
Interest rate margin (as a percent)					0.75%
Operating partnership | 2019 Senior Unsecured Term Loan | Base Rate | Maximum
Debt
Interest rate margin (as a percent)					1.65%
Operating partnership | 2019 Senior Unsecured Term Loan | Senior Unsecured Term Loan
Debt
Unsecured term loan			$ 100
Term of loan facility			5 years
Increase in accordion feature borrowing capacity			$ 100				$ 300
Accordion feature			$ 200
Aggregate principal amount							$ 200
Operating partnership | 2020 Senior Unsecured Term Loan | LIBOR
Debt
Interest rate margin (as a percent)					1.50%
Operating partnership | 2020 Senior Unsecured Term Loan | LIBOR | Minimum
Debt
Interest rate margin (as a percent)					1.50%
Operating partnership | 2020 Senior Unsecured Term Loan | LIBOR | Maximum
Debt
Interest rate margin (as a percent)					2.20%
Operating partnership | 2020 Senior Unsecured Term Loan | Base Rate | Minimum
Debt
Interest rate margin (as a percent)					0.50%
Operating partnership | 2020 Senior Unsecured Term Loan | Base Rate | Maximum
Debt
Interest rate margin (as a percent)					1.20%
Operating partnership | 2020 Senior Unsecured Term Loan | Senior Unsecured Term Loan
Debt
Unsecured term loan	$ 150	$ 150
Term of loan facility		5 years
Operating partnership | 2021 Senior Unsecured Term Loan | LIBOR
Debt
Interest rate margin (as a percent)					1.50%
Operating partnership | 2021 Senior Unsecured Term Loan | LIBOR | Minimum
Debt
Interest rate margin (as a percent)					1.50%
Operating partnership | 2021 Senior Unsecured Term Loan | LIBOR | Maximum
Debt
Interest rate margin (as a percent)					2.20%
Operating partnership | 2021 Senior Unsecured Term Loan | Base Rate | Minimum
Debt
Interest rate margin (as a percent)					0.50%
Operating partnership | 2021 Senior Unsecured Term Loan | Base Rate | Maximum
Debt
Interest rate margin (as a percent)					1.20%
Operating partnership | 2021 Senior Unsecured Term Loan | Senior Unsecured Term Loan
Debt
Unsecured term loan	$ 100
Term of loan facility	5 years
Operating partnership | 2023 Senior Unsecured Term Loan | Senior Unsecured Notes | Private Placement
Debt
Aggregate principal amount								$ 150
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 Term Loan | Senior Unsecured Term Loan
Debt
Unsecured term loan						$ 175
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%

Debt - Maturities (Details)

Debt - Maturities (Details) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Debt maturities
2,020	$ 150,000
2,021	100,000
Thereafter	473,000
Total principal outstanding	723,000	$ 694,000
Unamortized deferred financing costs	(3,343)	(3,550)
Total debt	$ 719,657	$ 690,450

Derivatives and Hedging Activ41

Derivatives and Hedging Activities (Details) - USD ($)	Apr. 21, 2017	Apr. 09, 2015	Feb. 03, 2014	Mar. 31, 2017	Mar. 31, 2016	Mar. 31, 2018	Dec. 31, 2016
Derivative instruments and hedging activities disclosures
Amount of gain (loss) recorded in accumulated other comprehensive income				$ 313,000	$ (3,198,000)
Cash Flow Hedging
Derivative instruments and hedging activities disclosures
Earnings related to derivatives due to hedge ineffectiveness				0	0
Interest Rate Swap | Designated as Hedging Instrument | Cash Flow Hedging
Derivative instruments and hedging activities disclosures
Amount borrowed under term loan or revolving credit facility		$ 75,000,000	$ 100,000,000
Term of loan facility		5 years	5 years
Derivative, Fixed Interest Rate		2.93%	3.23%
Interest rate swap terminated	$ 50,000,000
Amount of gain (loss) recorded in accumulated other comprehensive income				(300,000)	3,200,000
Amount reclassified to interest expense				300,000	$ 500,000
Amount recognized in unearned revenue, prepaid rent and other liabilities				100,000			$ 400,000
Derivative asset recognized in other assets				$ 600,000			$ 300,000
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						$ 400,000
LIBOR | Interest Rate Swap | Designated as Hedging Instrument | Cash Flow Hedging
Derivative instruments and hedging activities disclosures
Reference rate		one-month LIBOR

Stockholders' Equity (Details)

Stockholders' Equity (Details)	3 Months Ended
	Mar. 31, 2017$ / shares
Series A Cumulative Redeemable Preferred Stock
Stockholders' Equity
Dividends Payable, Date of Record	Apr. 17, 2017
Preferred stock dividend declared (per share)	$ 0.4531
Common Stock
Stockholders' Equity
Dividends Payable, Date of Record	Apr. 17, 2017
Common Stock dividend declared (per share)	$ 0.80

Noncontrolling Interests - Op43

Noncontrolling Interests - Operating Partnership (Details) $ / shares in Units, $ in Billions	Dec. 12, 2012shares	Mar. 31, 2017USD ($)$ / sharesshares	Dec. 31, 2016shares
Noncontrolling Interests - Operating Partnership
Series A Cumulative Preferred Stock, dividend rate (as a percent)		7.25%	7.25%
Operating partnership
Noncontrolling Interests - Operating Partnership
Conversion ratio for common operating partnership units		1
Preferred Operating Partnership units issued to CoreSite Realty Corporation (in shares)	4,600,000
Series A Cumulative Preferred Stock, dividend rate (as a percent)	7.25%
Number of Operating Partnership Units (in shares)		47,615,697	47,227,915
Percentage of Total		70.90%
Percentage of Total		29.10%
Percentage of Total		100.00%	100.00%
Shares of common stock issued related to employee compensation arrangements		387,782
Quarterly distributions will receive by holders of operating partnership units (in dollars per unit) | $ / shares		$ 0.80
Operating partnership | Coresite Realty Corporation
Noncontrolling Interests - Operating Partnership
Number of Operating Partnership Units (in shares)		33,764,350	33,376,568
Percentage of Total		70.90%	70.70%
Operating partnership | Noncontrolling Interests
Noncontrolling Interests - Operating Partnership
Number of Operating Partnership Units (in shares)		13,851,347	13,851,347
Percentage of Total		29.10%	29.30%
Redemption value of the noncontrolling interests | $		$ 1.2
Closing price of the Company's stock (in dollars per share) | $ / shares		$ 90

Equity Incentive Award Plan (De

Equity Incentive Award Plan (Details) - 2010 Plan - USD ($) $ / shares in Units, $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Equity Incentive Plan
Shares of common stock reserved for issuance	6,000,000
Shares of common stock that were available for issuance	3,054,224
Stock Options
Number of Shares Subject to Option
Options outstanding at the beginning of the period (in shares)	265,550
Exercised (in shares)	(163,699)
Options outstanding at the end of the period (in shares)	101,851
Weighted Average Exercise Price
Options outstanding at the beginning of the period (in dollars per share)	$ 22.96
Exercised (in dollars per share)	25.50
Options outstanding at the end of the period (in dollars per share)	$ 19.07
Number of Shares Subject to Option
Unvested balance at the beginning of the period (in shares)	16,323
Vested (in shares)	(16,323)
Weighted Average Fair Value at Grant
Unvested balance at the beginning of the period (in dollars per share)	$ 9.99
Vested (in dollars per share)	$ 9.99
Restricted Awards
Restricted Awards and PSA's
Unvested balance at the beginning of the period (in shares)	323,641
Granted (in shares)	126,846
Forfeited (in shares)	(26,321)
Vested (in shares)	(117,242)
Unvested balance at the end of the period (in shares)	306,924
Weighted Average Fair Value at Grant
Unvested balance at the beginning of the period (in dollars per share)	$ 53.84
Granted (in dollars per share)	85.51
Forfeited (in dollars per share)	62.23
Vested (in dollars per share)	41.33
Unvested balance at the end of the period (in dollars per share)	$ 69.48
Compensation cost not yet recognized
Unearned compensation	$ 20
Restricted Awards | Weighted Average
Compensation cost not yet recognized
Vesting period	3 years
PSAs
Compensation cost not yet recognized
Unearned compensation	$ 5.1
Assumptions used to value the stock options granted
Expected term	2 years 9 months 22 days	2 years 9 months 29 days
Expected volatility (as a percent)	23.33%	25.29%
Risk-free rate (as a percent)	1.60%	0.97%
PSAs | Weighted Average
Weighted Average Fair Value at Grant
Unvested balance at the beginning of the period (in dollars per share)	$ 54.24
Granted (in dollars per share)	105.30
Forfeited (in dollars per share)	79.09
Vested (in dollars per share)	25.89
Unvested balance at the end of the period (in dollars per share)	$ 84.49
Compensation cost not yet recognized
Vesting period	2 years 6 months
PSAs | Minimum
Restricted Awards and PSA's
Unvested balance at the beginning of the period (in shares)	44,835
Granted (in shares)	7,143
Performance adjustment	62,841
Forfeited (in shares)	(5,674)
Vested (in shares)	(70,518)
Unvested balance at the end of the period (in shares)	38,627
Compensation cost not yet recognized
Percentage of target number of shares for PSAs granted in 2014	0.00%
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)	167,725
Granted (in shares)	49,999
Forfeited (in shares)	(16,836)
Vested (in shares)	(70,518)
Unvested balance at the end of the period (in shares)	130,370
Compensation cost not yet recognized
Percentage of target number of shares for PSAs granted in 2014	150.00%
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)	113,976
Granted (in shares)	28,571
Performance adjustment	23,725
Forfeited (in shares)	(11,255)
Vested (in shares)	(70,518)
Unvested balance at the end of the period (in shares)	84,499

Earnings Per Share (Details)

Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Earnings Per Share
Net income attributable to common shares	$ 16,292	$ 11,261
Weighted-average common shares outstanding - basic	33,558,787	30,252,693
Effect of potentially dilutive common shares:
Stock options	156,035	200,379
Unvested awards	266,954	241,675
Weighted-average common shares outstanding - diluted	33,981,776	30,694,747
Net income per share attributable to common shares
Basic (in dollars per share)	$ 0.49	$ 0.37
Diluted (in dollars per share)	$ 0.48	$ 0.37
Weighted-average potentially dilutive securities excluded in calculation of basic and diluted income (loss) per share	39,937	59,408

Estimated Fair Value of Finan46

Estimated Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Estimated Fair Value of Financial Instruments
Total principal outstanding	$ 723,000	$ 694,000
Significant Unobservable Inputs (Level 3)
Estimated Fair Value of Financial Instruments
Fair value of debt	$ 725,800	$ 673,000

Commitments and Contingencies (

Commitments and Contingencies (Details) - USD ($)	Jul. 22, 2016	Jul. 23, 2015	Mar. 31, 2017
Accounts Payable and Accrued Expenses
Commitments and Contingencies
Accrued Litigation Liability			$ 2,900,000
Telecommunications Capacity
Commitments and Contingencies
Open commitments			10,400,000
Construction Contracts
Commitments and Contingencies
Open commitments			16,300,000
Pending Litigation | Minimum
Commitments and Contingencies
Estimated Loss Contingency			600,000
Pending Litigation | Maximum
Commitments and Contingencies
Estimated Loss Contingency			3,100,000
Pending Litigation | Damages Related To Services Rendered
Commitments and Contingencies
Loss Contingency, Damages Sought	$ 600,000	$ 802,564
Pending Litigation | Damages For Loss Of Revenue And Other Costs
Commitments and Contingencies
Loss Contingency, Damages Sought		$ 70,080,000
Commonwealth Of Virginia | Minimum
Commitments and Contingencies
Estimated sales and use tax liability			0
Commonwealth Of Virginia | Maximum
Commitments and Contingencies
Potential sales and use tax liability, if certain thresholds are not met			7,500,000
Estimated sales and use tax liability			$ 4,000,000